UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
(Amendment No. 1)
☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d)15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 20222023
or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15d15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________ to ________

Commission file number 001-41406
Enhabit, Inc.
(Exact name of Registrant as specified in its charter)
Delaware47-2409192
(State or other jurisdiction of incorporation or organization)(I.R.S. employerEmployer Identification number)Number)
6688 N. Central Expressway Suite 130075206
Dallas, TX(Zip code)
(Address of principal executive offices)
214-239-6500
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $0.01 per shareEHABNew York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No ☒
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No o



Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer☐Accelerated filer☐☒
Non-accelerated filer☒☐Smaller reporting company☐
Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transactiontransition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No ☒
As of June 30, 2022, the last business day of the registrant’s most recently completed second fiscal quarter, there was no established public market for the registrant’s common stock. The registrant’s common stock began trading on the New York Stock Exchange on July 1, 2022. The aggregate market value of the voting stock held by non-affiliates of the registrant as of July 1, 2022the last business day of the registrant’s most recently completed second fiscal quarter was $1.1 billion$570.7 million (based on the last reported sale price on the New York Stock Exchange as of such date).
The registrant had outstanding 50,089,32850,155,782 shares of common stock as of April 26, 2023.17, 2024.
Documents Incorporated By Reference
None.

Audit Firm IDAuditor NameAuditor Location
238PricewaterhouseCoopers LLPDallas, Texas




TABLE OF CONTENTS
Page
ii
Note Regarding Presentation and Reconciliations of Adjusted EBITDA
ii
Item 10. Directors, Executive Officers and Corporate Governance
1
Item 11. Executive Compensation
1413
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related ShareholderStockholder Matters
3935
Item 13. Certain Relationships and Related Transactions, and Director Independence
4137
Item 14. Principal Accountant Fees and Services
4438
Item 15. Exhibits and Financial Statement Schedules
4639
Appendix A - Reconciliations of Non-GAAP Financial Measures to GAAP Results
40
4742

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Explanatory Note
Enhabit, Inc. (“Enhabit,” “we,” “us,” “our” or the “Company”) is filing this Amendment No. 1 on Form 10-K/A (this “Amendment”) to our Annual Report on Form 10-K, originally filed on April 14, 2023March 15, 2024 (the “Initial Filing”), for the purpose of providing the information required in Part III of Form 10-K. This information was previously omitted from the Initial Filing in reliance on General Instruction G(3) of Form 10-K because we intended to incorporate the required disclosures from our proxy statement relating to our 20232024 Annual Meeting of stockholders. Our 20232024 proxy statement, however, will not be filed within the requisite time period to allow incorporation by reference. Accordingly, this Amendment changes our Initial Filing by including the information required by Part III of Form 10-K (Items 10, 11, 12, 13 and 14).
In accordance with Rules 12b-15 and 13a-14 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), we have also amended Part IV, Item 15 to include currently dated certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 from our principal executive officer and principal financial officer. Because no financial statements have been included in this Amendment and this Amendment does not contain or amend any disclosure with respect to Items 307 and 308 of Regulation S-K, paragraphs 3, 4 and 5 of the certifications have been omitted. Similarly, because no financial statements have been included in this Amendment, certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 have been omitted.
Except as indicated herein, this Amendment does not modify or update disclosures contained in the Initial Filing and speaks only as of the date of the Initial Filing. This Amendment does not reflect events that may have occurred subsequent to the date of the Initial Filing.
Prior to July 1, 2022, we operated as a reporting segment of Encompass Health Corporation (“Encompass”). On March 7, 2022, we changed our name from “Encompass Health Home Health Holdings, Inc.” to “Enhabit, Inc.” On July 1, 2022, Encompass completed the previously announced Separationseparation of the Company through the distribution of all of the outstanding shares of common stock, par value $0.01 per share, of Enhabit to the stockholders of record of Encompass (the “Distribution”) as of the close of business on June 24, 2022 (the “Record Date”). The Distribution was effective at 12:01 a.m., Eastern Time, on July 1, 2022. As a result of the Distribution, Enhabit is now an independent public company, and its common stock is listed under the symbol “EHAB” on the New York Stock Exchange (the “Separation”). As part of the Separation, Enhabit and Encompass entered into certain agreements that provide a framework for our relationship with Encompass after the Separation and Distribution. For additional discussion of the Separation and Distribution, as well as our relationship with Encompass, see Item 1A, “Risk“Risk Factors —Risks Related to Our Recent Separation from Encompass,” in the Initial Filing.

Note Regarding Presentation and Reconciliations of Adjusted EBITDA

The financial data contained in this Amendment includes Adjusted EBITDA, a non-GAAP (generally accepted accounting principles (GAAP)) financial measure as defined in Regulation G under the Securities Exchange Act of 1934. See Appendix A - “Reconciliations of Non-GAAP Financial Measures to GAAP Results” for reconciliations of Adjusted EBITDA to the most directly comparable financial measures calculated and presented in accordance with GAAP. Non-GAAP financial measures exclude significant components in understanding and assessing financial performance and should therefore not be considered superior to, as a substitute for or alternative to the GAAP financial measures. The Adjusted EBITDA measure in this Amendment may differ from similar measures used by other companies.

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PART III
Item. 10Item 10. Directors, Executive Officers and Corporate Governance
Executive Officers
The following table lists all of our executive officers. Each of our executive officers will hold office until his or her successor is elected and qualified, or until his or her earlier resignation or removal.
NameAgePositionSince
Barbara A. Jacobsmeyer5658President and Chief Executive Officer; Director6/2021
Crissy B. Carlisle5052Executive Vice President and Chief Financial Officer8/2021
Dylan C. Black5455General Counsel and Secretary1/2023
Julie Jolley5052Executive Vice President of Home Health Operations1/20005/2019
Jeanne Kalvaitis6667Executive Vice President of Hospice Operations6/2022
Ronald L. (Bud) Langham, Jr.4647Executive Vice President of Clinical Excellence and Strategy10/200812/2021
Tanya Marion4950Chief Human Resources Officer1/2022

Executive Biographies
Barbara A. Jacobsmeyer, President and CEO
Ms. Jacobsmeyer has served as President and Chief Executive Officer of Enhabit since June 2021. Prior to that, she served as Encompass’sEncompass’ Executive Vice President of Operations beginning in December 2016. Ms. Jacobsmeyer joined Encompass in 2007 as Chief Executive Officer of the Rehabilitation Hospital of St. Louis, a partnership of BJC HealthCare and Encompass, and then as President of Encompass’sEncompass’ Central Region from 2012 to 2016. Prior to joining Encompass, Ms. Jacobsmeyer served as Chief Operating Officer for Des Peres Hospital in St. Louis, Missouri. She received her bachelor’s degree in physical therapy from St. Louis University and her master’s degree in health services management from Webster University. Ms. Jacobsmeyer, as our President and Chief Executive Officer, directs the strategic, financial and operational management of the Company and, in this capacity, provides unique insights into its detailed operations. She also has the benefit ofbrings to bear more than 30 years of experience in healthcare operations and management.
Crissy B. Carlisle, Executive Vice President and Chief Financial Officer
Ms. Carlisle has served as Chief Financial Officer of Enhabit since August 2021. Prior to that, she served as Encompass’sEncompass’ Chief Investor Relations Officer since September 2015. Ms. Carlisle joined Encompass in February 2005 as the director of SEC reporting and was promoted to Vice President of Financial Reporting in August 2005. Prior to joining Encompass, Ms. Carlisle served as a Director at FTI Consulting within the Corporate Recovery Division and additionally as a manager within PricewaterhouseCoopers’ audit practice. She received her bachelor’s degree in accounting from the University of Alabama and her master’s degree in business administration from Duke University’s Fuqua School of Business. Ms. Carlisle currently serves as a Vice President on the International Council of Gamma Phi Beta.
Dylan C. Black, General Counsel and Secretary
Mr. Black has served as General Counsel and Secretary of Enhabit since January 2023. Prior to that, he was a Partner at the law firm Bradley Arant Boult Cummings LLP in Birmingham, Alabama, where he practiced from 1998 to 2022. Before his career in private practice, Mr. Black clerked for the Hon. Harry W. Wellford on the United States Court of Appeals for the Sixth Circuit in Memphis, Tennessee. Mr. Black received his bachelor's degree in government from Harvard College and his law degree from the University of Virginia School of Law.

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Julie D. Jolley, Executive Vice President of Home Health Operations
Ms. Jolley has been with Enhabit (previously Encompass Home Health) since 2000 and has served in her current role as Executive Vice President of Home Health Operations of Enhabit since May 2019. Prior to that, she served as Regional President of Home Health since 2016. Ms. Jolley joined Enhabit in January 2000several roles with increasing responsibility, including, as a Branch DirectorRegional Vice President and was promoted to several other roles before her current position.then Regional President. Prior to joining Enhabit, Ms. Jolley was a registered nurse with experience in a variety of practice settings. She received her bachelor’s degree in nursing from Chamberlain University. She also has the benefit ofMs. Jolley leverages more than 2930 years of experience in healthcare.healthcare experience.
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Jeanne L. Kalvaitis, Executive Vice President of Hospice Operations
Ms. Kalvaitis has served as Executive Vice President of Hospice Operations of Enhabit since June 9, 2022. Ms. Kalvaitis has more than 30 years of healthcare administrative experience. Prior to joining Enhabit, she served as Vice President Hospice Operations and Divisional Vice President Clinical Services for Compassus, a hospice and palliative care provider in Fort Worth, Texas, from 2019 to 2021, where she worked on the transition of Ascension at Home hospice agencies after their acquisition by Compassus. Prior to holding that position, Ms. Kalvaitis served as Enhabit’s Vice President Clinical Services from 2014 to 2019 and held numerous positions at Vitas Healthcare Corporation from 1990 to 2014, including Vice President Operations, Vice President Business Development, and Senior General Manager. Ms. Kalvaitis is a registered nurse in Texas and Connecticut and has experience in a variety of practice settings prior to assuming the above administrative roles. Ms. Kalvaitis thus brings more than 30 years of healthcare administrative experience to her leadership of our hospice segment. She received her bachelor’s degree in nursing from the University of Texas at El Paso and her diploma in nursing from St. Vincent’s Medical Center School of Nursing in Bridgeport, Connecticut.
Ronald L. (Bud) Langham, Jr., Executive Vice President of Clinical Excellence and Strategy
Mr. Langham has been with the company sincejoined Enhabit (previously Encompass Home Health) in October 2008 and currently serveshas served in his current role as Executive Vice President of Clinical Excellence and Strategy.Strategy since December 2021. Prior to that, he served in several roles at Enhabit includewith increasing responsibilities including, Chief Strategy and Innovation Officer and Chief Clinical Officer.Officer of Encompass Home Health. He is a physical therapist by training and has direct patient care and leadership experience in a variety of acute and post-acute settings. Mr. Langham received his degree in physical therapy from the University of Oklahoma Health Sciences Center in 1999 and a Master’s Degree in Business Administration from the University of Oklahoma in 2005.Oklahoma. He is an active member of the American Physical Therapy Association and has served on multiple technical expert panels (TEPs) for the Centers for Medicare and Medicaid Services (CMS).Services.
Tanya R. Marion, Chief Human Resources Officer
Ms. Marion has served as Chief Human Resources Officer of Enhabit since January 24, 2022. Prior to joining Enhabit, she served as the Chief Human Resources Officer – Operations of Mercy Health, a not-for-profit health care system in St. Louis, Missouri, from 2017 to 2022. Prior to that, she served in a variety of human resources leadership roles with increasing responsibility at Mercy Health from 2007 to 2017. She received her bachelor’s degree in business management from Missouri State University and her master’s degree in management and leadership from Western Governors University.

Directors
The board of directors of Enhabit (the “Board”) currently consists of 13 members. We identify and describe below the key experience, qualifications and skills our directors bring to the Board.
Leo I. Higdon, Jr., ChairmanChairperson of the Board
Director Since: 7/1/2022
Board Committees:Committee: Audit Committee (Chairperson),& Finance Committee
Age:Age 76: 77
Mr. Higdon joined Encompass’s Board of Directors in 2004 and served as its Chairman from 2014 until May 5, 2022. He served as President of Connecticut College from July 1, 2006, to December 31, 2013. He served as the President of the College of Charleston from October 2001 to June 2006. Between 1997 and 2001, Mr. Higdon served as President of Babson College in Wellesley, Massachusetts. He also served as Dean of the Darden Graduate School of Business Administration at the University of Virginia. His financial experience includes a 20-year tenure at Salomon Brothers, where he became Vice Chairman and Member of the Executive Committee, managing the Global Investment Banking Division. Mr Higdon became a Director of Encompass in 2004 and served as its Chairman from 2014 until 2022. Mr. Higdon also served as a Director of Citizens Financial Group, Inc. As a result of his 20 years of experience in the financial services industry combined with his strategic management skills gained through various senior executive positions, including in academia, and service on numerous boards of
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directors, Mr. Higdon has extensive experience with strategic and financial planning and the operations of public companies.
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Jeffrey W. Bolton
Director Since: 7/1/2022
Board Committees: Audit Committee, Compliance/Quality of& Finance; Care, CommitteeCompliance & Cybersecurity Committees
Age: 6768
Mr. Bolton has more than 4020 years of executive and board experience in a variety of sectors, includingthe healthcare higher education, and local government.sector. Throughout his career, Mr. Bolton has developed a deep knowledge of acute care hospitals and integrated health networks. Most recently,After serving as Chief Financial Officer at Mayo Clinic from 2002 to 2013, Mr. Bolton served as the Chief Administrative Officer and Vice President for Administration (the most senior non-physician executive) at Mayo Clinic.Clinic until his retirement in December 2021. While holding this position, Mr. Bolton managed strategic alliances and business development, corporate accounting and external reporting, and financial planning and analysis.analysis and clinical and hospital administrative operations. Mr. Bolton co-led the development of the organization’s new strategic plan and substantially transformed the leadership team, bringing in high-profile executives from outside the system for key roles, such as Chief Financial Officer and Chief Human Resources Officer, that had traditionally been filled from within. Prior to serving as the Chief Administrative Officer and Vice President, Mr. Bolton was the Chief Financial Officer and Chair of the Department of Finance at Mayo Clinic.team. Prior to joining Mayo Clinic, Mr. Bolton worked at Carnegie Mellon University where he held various finance and planning positions, including Chief Financial Officer. Previously, Mr. Bolton workedOfficer, and as a Planning and Financial Analyst at the University of Pittsburgh. He began his career as a Contract Administrator in the City of Pittsburgh. Mr. Bolton currently serves on the Boardboard of Resoundant, Inc., a privately held medical technology company. He was recently elected to serve on the Board of Directors ofcompany, MCSI, a privately held reference lab company and HMN Financial, Inc., a publicly traded stock savings bank holding company. As discussed above,In addition to Mr. Bolton brings toBolton’s extensive knowledge of the boardhealthcare industry, he contributes strong leadership, accounting, finance, and strategic planning skills and qualifications through his extensive experience in a variety of industries, including healthcare.to the board.
Tina L. Brown-Stevenson
Director Since: 7/1/2022
Board Committees: Nominating/Nominating & Corporate Governance Committee, Compliance/Quality ofGovernance; Care, CommitteeCompliance, & Cybersecurity Committees
Age: 6667
Ms. Brown-Stevenson is a retired executive who brings nearly three decades of experience in the national healthcare payor industry, where she developed an expertise in health system analytics and data. Ms. Brown-Stevenson joined UnitedHealth Group in 2008 as the Executive Vice President of Healthcare Innovation and Information Group before being promoted to the Chief Data and Analytics Officer of OptumInsight. In 2012, Ms. Brown-Stevenson rose to the role of Senior Vice President of Health System Analytics and Decision Support, where she oversaw the analysis and management of provider and patient data to validate UnitedHealth Group’s strategy and product offerings, before her retirement in 2019. Prior to joining UnitedHealth Group, Ms. Brown-Stevenson previously held senior leadership positions at several other healthcare insurance companies, including Aetna, Cigna, and Partners Healthcare. In addition to her healthcare company experience,companies. Ms. Brown-Stevenson currently serves on the boards of directorsboard of several organizations, including Connecticut Children’s Medical Center and Kyruus Inc., a technology company that provides provider search and scheduling solutions to healthcare organizations. She also serves on the Advisory Board of the Commonwealth Honors College at the University of Massachusetts, Amherst. Ms. Brown-Stevenson has demonstrated her leadership and character through involvement on board roles in community, civic and civicprivately-held organizations. Ms. Brown-Stevenson also provided patient care for many years as a Registered Nurse. As a result of her leadership roles at several large national payors in the rapidly evolving field of healthcare data and analytics and her various private board memberships, Ms. Brown-Stevenson is in a unique position to draw on her extensive experience to advise on opportunities to improve the quality of care for our patients.
Yvonne M. Curl
Director Since: 7/1/2022
Board Committees:Compensation and& Human Capital Committee (Chair), Nominating/(Chairperson); Nominating & Corporate
Governance CommitteeCommittees
Age: 6869
Ms. Curl served as a Director on Encompass’s Board of Directors from 2004 until May 5, 2022. Ms. Curl is a former Vice President and Chief Marketing Officer of Avaya, Inc., a global provider of next-generation business collaboration and communications solutions, whicha position she held from October 2000 through April 2004. Before
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joining Avaya, Ms. Curl was employed by Xerox Corporation beginning in 1976, where she held a number of middle and senior management positions in sales, marketing and field operations, culminating with her appointment to Corporate Vice President. Ms. Curl currently serves as a Director/Trustee of VALIC Companies I & II, a mutual fund complex sponsored by American International Group, Inc., and as a Director on the board of the Hilton Head Community Foundation. Ms. Curl served as a Director of Encompass from 2004 until May 2022. In the past five years, she has served as a Director of Nationwide Mutual Insurance Company and the Hilton Head Humane Association. Ms. Curl has proven senior executive experience with broad operational experience in sales, marketing, and general management through her previous roles with large public companies as described above. Having served on and chaired several compensation committees on the board of directors of public companies, she has experience in the development and oversight of compensation programs and policies.
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Charles M. Elson
Director Since: 7/1/2022
Board Committees:Committee: Nominating/Nominating & Corporate Governance Committee Finance Committee (Chair)
Age: 6364
Mr. Elson served as a Director on Encompass’s Board of Directors from 2004 until May 5, 2022. Mr. Elson is a retired professor of Finance and the retired Edgar S. Woolard, Jr. Chair in Corporate Governance at the University of Delaware’s Alfred Lerner College of Business and Economics. Since 2020, he has served as Executive Editor-at-Large of Directors & Boards magazine. From 2000 to 2020, he served as the Founding Director of the John L. Weinberg Center for Corporate Governance at the University of Delaware. Mr. Elson has also been Of Counsel/Consultant to the law firm Holland & Knight LLP from 1995 to the present. In addition, Mr. Elson serves as Vice Chairman of the American Bar Association’s Committee on Corporate Governance. Mr. Elson served on the National Association of Corporate Directors’ Commissions on Director Compensation, Executive Compensation and the Role of the Compensation Committee, Director Professionalism, CEO Succession, Audit Committees, Governance Committee, Strategic Planning, Director Evaluation, Talent Development, Risk Governance, Role of Lead Director, Strategy Development, Board Diversity, Board and Long-term Value Creation, and Building the Strategic Asset Board. Additionally, he has served as a member of the National Association of Corporate Directors’ Best Practices Council on Coping with Fraud and Other Illegal Activity and of that organization’s Advisory Council. Mr. Elson serves on the board of Blue Bell Creameries U.S.A., Inc., a privately held company. He recently served as a Director of Bob Evans Farms, Inc. In addition, Mr. Elson serves as Vice Chairman of the American Bar Association’s Committee on Corporate Governance. Mr. Elson has been Of Counsel/Consultant to the law firm of Holland & Knight LLPEncompass from 1995 to the present.2004 until 2022. Mr. Elson has extensive knowledge of and experience in matters of corporate governance through his leadership roles with various professional organizations dedicated to the topics as described above.organizations. Mr. Elson’s academic, professional and board experiences allowsallow him to effectively address the range of issues facing public companies.
Erin P. Hoeflinger
Director Since: 7/1/2022
Board Committees: Compensation and& Human Capital Committee, Compliance/Quality ofCapital; Care, CommitteeCompliance, & Cybersecurity Committees
Age: 5758
Ms. Hoeflinger bringshas over two decades of experience and expertise in the healthcare payor industry and has played key roles in strategy, operations, and general management throughout her career. Ms. Hoeflinger joined Aetna Inc. in 2018 and rose to the role of Senior Vice President of Specialty and Strategic Solutions, where she led the strategy to unite CVS and Aetna assets post-merger (one of the largest health insurance acquisitionsuntil her retirement in history).2021. Prior to her time at Aetna, Ms. Hoeflinger held several senior leadership positions at Anthem, including the Senior Vice President and President for Local Commercial Business, Senior Vice President and President of the Commercial and Specialty Business Division, the President of Anthem Blue Cross and Blue Shield of Ohio, and the President of Anthem Blue Cross and Blue Shield of Maine.Anthem. Throughout her career, Ms. Hoeflinger has developed an extensive skill set in implementing and leading complex transformations and integrations. In addition to her healthcare company experience, Ms. Hoeflinger presently serves on the Board of Directors and the Nominating and Governance Committeeboard of Midmark Corporation, a privately held company that manufactures and suppliesmanufacturer of medical, dental, and animal healthcare products. She previously served on the Board of Directors and the Compensation Committeeboard of First Financial Bancorp, a publicly traded banking and financial services company. Ms. Hoeflinger also served on the Board of Directors and Compensation Committee of MainSource Financial Group, Inc. and MainSource Bank. Ms. Hoeflinger served as a Member of The Ohio State University Board of Trustees, including on its Audit, Compliance, and Finance committee, and also served on the board of the Wexner Medical Center, an academic medical center on The Ohio State University campus. She has also served in various local and national private and nonprofit board leadership roles. In addition to Ms. Hoeflinger extensive knowledge of the healthcare payor industry, she brings strong strategic planning, management, and marketing skills to the Board.
Susan A. La Monica
Director Since: 7/1/2022
Board Committee: Compensation & Human Capital Committee
Age: 63
Ms. La Monica is the Chief Human Resources Officer for Citizens Financial Group, Inc. (“Citizens”), a publicly traded banking and financial services company and one of the country’s largest regional banks, where she is responsible for developing human resource strategies to support the company’s business plan. She is a member of the bank’s ESG steering committee and jointly oversees the Corporate Affairs and Communications functions for the organization. Prior to Citizens, Ms. La Monica held several senior human resources leadership roles at Royal Bank of Scotland (which spun out Citizens in 2014) and at JP Morgan Chase. In addition to her human resources experience, Ms. La Monica has demonstrated her leadership and character through over a decade of involvement on board roles in numerous academic, community, and civic organizations. As a result of her 20 yearsdiverse leadership roles, Ms. La Monica is well positioned to address a full range of experience in the healthcare industry where she developed strategichuman capital issues, including compensation and benefits, talent acquisition and development, culture and change management, experience as well as her experience serving on a public company board, Ms.
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Hoeflinger brings both strong strategic planningmatters related to strategy and corporate governance skills to the board, having led complex transformations and integrations several times throughout her career.ESG.
John E. Maupin, Jr.
Director Since: 7/1/2022
Board Committees: Audit Committee, Compliance/Quality of& Finance; Care, Committee (Chair)Compliance & Cybersecurity (Chairperson) Committees
Age: 7677
Dr. Maupin served as a Director on Encompass’s Board of Directors from 2004 until May 2022. Dr. Maupin is a retired healthcare executive with over 40 years of diverse executive leadership experience in academic medicine, public health, ambulatory care and government relations. He served as President and Chief Executive
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Officer of Morehouse School of Medicine for eight years until his retirement in July 2014. Prior to that, he was the President and Chief Executive Officer of Meharry Medical College for 12 years. His other executive leadership positions have included Chief Administrative Officer of the Morehouse School of Medicine, Chief Executive Officer of Southside Healthcare, Inc., and Deputy Commissioner Medical Services, Baltimore City Health Department. Dr. Maupin currently serves as the Chair of the Board of Directors for VALIC Company I, a mutual fund complex sponsored by Corebridge Financial, Inc. InDr. Maupin served as a Director of Encompass from 2004 until 2022. Additionally, in the past 10 years, he has served as a Director on the boards of LifePoint Health, Inc. and Regions Financial Corp. Dr. Maupin has a distinguished record as a health policy expert, having served on numerous national public health and scientific advisory boards and panels. He also has extensive experience working with the legislative and executive branches of federal and state government and agencies within the U.S. Department of Health and Human Services. Additionally, he has demonstrated his leadership and character through involvement in board roles in community and civic organizations as well as his 20 year career as a Dental Officer in the U.S. Army Reserves. Dr. Maupin brings to the board executive leadership and management skills through his extensive healthcare executive experience as well as his tenure on several boards.
Susan A. LaMonica
Director Since: 7/1/2022
Board Committees: Compensation and Human Capital Committee, Finance Committee
Age: 62
Ms. LaMonica is the Chief Human Resources Officer for Citizens Financial Group, a publicly traded banking and financial services company, where she is responsible for developing human resource strategies to support the company’s business plan. She is a member of the bank’s ESG steering committee and also jointly oversees the Corporate Affairs and Communications functions for the organization. Additionally, Ms. LaMonica played a key role in the separation of Citizens Financial Group from the Royal Bank of Scotland in 2014. Prior to joining Royal Bank of Scotland in 2011, Ms. LaMonica held several senior human resources leadership roles at JP Morgan Chase. In addition to her human resources experience, Ms. LaMonica has demonstrated her leadership and character through over a decade of involvement on board roles in numerous community and civic organizations. As a result of her diverse leadership roles, Ms. LaMonica is well positioned to address a full range of human capital issues, including compensation and benefits, talent acquisition and development, organizational development, and ESG matters.
Stuart M. McGuigan
Director Since: 3/30/2023
Board Committees: The Board intends to appoint Mr. McGuigan to the Nominating/Nominating & Corporate
Governance Committee and Compliance/Quality ofGovernance; Care, committee in May 2023Compliance & Cybersecurity Committees
Age: 6465
Mr. McGuigan currently serves as a Senior Advisor at McKinsey & Company,interim Global Chief Information Officer for Fresenius Medical Care, an integrated dialysis clinic and device company, a position he has held since 2021.March 2023. Prior to this position, he served as Chief Information Officer (“CIO”) of the U.S. Department of State (the “Department”) from 2019 to 2021. As CIO, he established technology strategic direction and provided oversight for $2.4 billion of technology programs across the Department. Mr. McGuigan joined the Department of State from Johnson & Johnson, (NYSE: JNJ), where he served as CIO from 2012 to 2019 and was responsible for Global Information Technology Strategy and Operations for an organization with 130,000 employees at over 170 overseas and domestic locations. Prior to Johnson & Johnson, Mr. McGuigan served as Senior Vice President and CIO of CVS Caremark, Senior Vice President and CIO of Liberty Mutual and Senior Vice President of Information Services for Medco Health Solutions. Mr. McGuigan has an established reputation for rapidly aligning technology innovation with global business needs. He currently serves as a directorcontributes over three decades of Posit PBCinformation technology and M2GEN.
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management experience to the Board and contributes to an understanding of every aspect of Information Technology, including information technology strategy, Artificial Intelligence, cloud computing, scalable data analytics and risks associated with cybersecurity matters.
Gregory S. Rush
Director Since: 7/1/2022
Board Committees: Audit Committee,& Finance Committee (Chairperson)
Age: 5556
Mr. Rush bringshas more than 30 years of financial experience and expertise within the clinical research organization (CRO)(“CRO”), biopharmaceutical, technology, and professional services industries. He joined Parexel International Corporation, a global CRO, as Executive Vice President and Chief Financial Officer in 2018. Prior to joining Parexel, Mr. Rush served from 2013 to 2018 as Executive Vice President and Chief Financial Officer of Syneos Health, Inc., a publicly traded biopharmaceutical services organization. Mr. Rush also was Senior Vice President and Chief Financial Officer of Tekelec, Inc., a leading developer of telecommunications products and services acquired by Oracle. Mr. Rush’s experience also includes serving in various roles at Siebel Systems, Inc., Quintiles Transnational Corporation, PricewaterhouseCoopersdeveloping innovative financial management strategies, strong capital structures, high levels of operational support and Ernst & Young, where he developedsound corporate governance. His extensive knowledge in financial operations, capital market transactions, financial reporting, and acquisitions.acquisitions provides valuable insight on financial and management strategies to the Board.
Barry P. Schochet
Director Since: 3/30/2023
Board Committees: Nominating/Nominating & Corporate Governance Committee, Compliance/Quality ofGovernance; Care,
             Committee Compliance & Cybersecurity Committees
Age: 7273
Mr. Schochet serves as a Healthcare Operating Partner at CIC Partners, an investment firm with an investment record spanning more than 30 years and representing greater than $1 billion in aggregate realized proceeds, a position he has held since 2007. Prior to his current role at CIC Partners,He is also a director of BroadJump LLC, a privately held healthcare supply chain analytics company. Mr. Schochet served as the President and CEO of BPS Health Ventures, a healthcare consulting and investment firm from 2005 to 2017. In addition,and as Vice Chairman (after holding numerous senior executive positions) at Tenet Healthcare. Additionally, Mr. Schochet served as Vice Chairman and a number of other senior executive positions, including President of the Hospital Division, at Tenet Healthcare (NYSE: THC) and its predecessor National Medical Enterprises from 1979 to 2004. During his tenure, Tenet reached revenues of over $13 billion. Mr. Schochet has previously served as a Directordirector for several health carehealthcare companies, including Omnicare (NYSE:OCR), until it was acquired by CVS (NYSE: CVS), and Universal Hospital Services which became(now Agiliti, (NYSE: AGTI).Inc.), both publicly traded
5

companies. Mr. Schochet currently serves as a Directorcontributes more than 40 years of BroadJump LLC.strategic business and healthcare compliance expertise and provides extensive financial and leadership experience to the Board.
L. Edward Shaw, Jr.
Director Since: 7/1/2022
Board Committees: Compensation and& Human Capital Committee, Nominating/Capital; Nominating & Corporate Governance (Chairperson)
Committee (Chair)Committees
Age: 7879
Mr. Shaw served as a Director on Encompass’s Board of Directors from 2005 until May 5, 2022. Following his practice as a Partnerpracticed law at Milbank LLP Mr. Shawfor 14 years, retiring as a partner in 1983. He also served as General Counsel of The Chase Manhattan Bank from 1983 to 1996 and Aetna, Inc. from 1999 to 2003. In addition to his legal role, his responsibilities at both institutions included a wide range of strategic planning, risk management, compliance and public policy issues. From 1996 to 1999, he served as Chief Corporate Officer of the Americas for National Westminster Bank PLC. In 2004, Mr. Shaw was appointed Independent Counsel to the Board of Directors of the New York Stock Exchange dealing with regulatory matters. From March 2006 to July 2010, he served on a part-time basis as a Senior Managing Director of Richard C. Breeden & Co., and Affiliated Companies engaged in investment management, strategic consulting, and governance matters. InMr. Shaw served as a Director of Encompass from 2005 until 2022. Additionally, in the past five years, Mr. Shaw has served as a Director of MSA Safety Inc. (NYSE: MSA). He currently serves as a Director and Former Chairman of Covenant House, the nation’s largest privately funded provider of crisis care to children. Mr. Shaw has a wide ranging legal and business background, including senior leadership roles, in the context of large public companies as described above with particular experience in corporate governance, risk management and compliance matters. He also has significant experience inrelating to the healthcare industry as a result of his position with Aetna.industry.
Barbara A. Jacobsmeyer, President and CEO
Director Since: 7/1/2022
Age: 5758
Ms. Jacobsmeyer’s biography is included in the “Executive Officer” section above.
6

Director Independence
The NYSE listing standards require that the Company have a majority of independent directors and provide that no director will qualify as “independent” for these purposes unless the Board affirmatively determines that the director has no material relationship with the Company. Additionally, the listing standards set forth a list of relationships and transactions that would prevent a finding of independence if a director or an immediate family member of that director were a party.
On an annual basis, the Board undertakes a review of the independence of the directors. In accordance with the NYSE listing standards, we do not consider a director to be independent unless the Board determines (i) the director meets all NYSE independence requirements and (ii) the director has no material relationship with the Company (either directly or as a partner, stockholder or officer of an organization that has a relationship with the Company). Members of the Audit, Compensation and Human Capital, and Nominating/Corporate Governance Committees must also meet applicable independence tests of the NYSE and the SEC. In connection with this determination, each director and executive officer completes a questionnaire which requires disclosure of, among other topics: any transactions or relationships between any director or any member of his or her immediate family and the Company and its subsidiaries, affiliates, our independent registered public accounting firm or any advisors to the Compensation and Human Capital Committee; any transactions or relationships between any director or any member of his or her immediate family and members of the senior management of the Company or their affiliates; and any charitable contributions to not-for-profit organizations for which our directors or immediate family members serve as executive officers.
Our Board has determined that all 12 of our non-employee directors are independent in accordance with our Corporate Governance Guidelines and the NYSE listing standards. All of the members of the Audit, Compensation and Human Capital, Nominating/Corporate Governance, Compliance/Quality of Care, and Finance Committees satisfy those independence tests.

7

Corporate Governance
Corporate Governance Guidelines
Our Board has developed corporate governance policies and practices in order to help fulfill its responsibilities to stockholders and provide a flexible framework for it to review, evaluate, and oversee the Company’s business operations and management. Our Corporate Governance Guidelines provide, among other things, that each member of the Board will:
•dedicate sufficient time, energy, and attention to ensure the diligent performance of his or her duties;
•comply with the duties and responsibilities set forth in the guidelines and in our Bylaws;
•comply with all duties of care, loyalty, and confidentiality applicable to directors of publicly traded Delaware corporations; and
•adhere to our Standards of Business Ethics and Conduct, including the policies on conflicts of interest.
Our Nominating/Nominating & Corporate Governance Committee oversees and periodically reviews the Guidelines, and recommends any proposed changes to the Board for approval.
Code of Ethics
We have adopted the Standards of Business Ethics and Conduct, our “code of ethics,” that applies to all employees, directors and officers, including our principal executive officer, principal financial officer, and principal accounting officer or controller, or persons performing similar functions. The purpose of the code of ethics is to promote:
•honest and ethical conduct, including the ethical handlingcovers a variety of actual or apparentmatters, such as acting with integrity, compliance with laws, avoiding conflicts of interest between personal and professional relationships;
•full, fair, accurate, timely, and understandable disclosure in periodic reports required to be filed by us;
•compliance with all applicable rules and regulations that apply to us and our employees, officers, and
directors;
•prompt internal reporting of violations of the code to an appropriate person or persons identified in the code; and
•accountability for adherence to the code.
patient privacy. We disclose any amendments to, or waivers from, the code of ethics for executive officers and directors on our website (https://investors.ehab.com) promptly following the date of the amendment or waiver. Upon written request to our corporate secretary, we will also provide a copy of the code of ethics free of charge.
Board Oversight of the Company’s Risks
We maintain a comprehensive enterprise risk management program designed to identify potential events and conditions that may affect the Company and to manage risks to avoid materially adverse effects on the Company. Our management, including an executive risk committee, is responsible for the design and implementation of the enterprise risk management, or ERM, program. The Audit Committee of the Board, pursuant to its charter, is responsible for reviewing and evaluating our policies and procedures relating to risk assessment and management. The full Board monitors the ERM program by way of regular reports from our senior executives on management’s risk assessments and risk status as well as our risk response and mitigation activities. Individual committees monitor, by way of regular reports, the material risks that relate to the responsibilities of that committee and report to the Board appropriate information. For example, the Compliance/Quality of Care Committee oversees assessment and management of several risk-related topics, such as cybersecurity, privacy, Medicare claims audits, patient satisfaction data, quality of care data, and compliance program administration.
We design our compensation program with the understanding that while some degree of risk is necessary and appropriate, we believe our compensation program should not encourage excessive or inappropriate risk. The Compensation and Human Capital Committee regularly monitors and evaluates our compensation policies and practices to ensure they align with good governance practices. Additionally, the Compensation and Human Capital
8

Committee oversees assessment and management of human capital-related risks, such as those involving recruitment, retention, inclusion and diversity, employee engagement, and employment litigation. For further discussion of our human capital management, see Item 1, Business, of our Annual Report on Form 10-K for the year ended December 31, 2022.
The Compensation and Human Capital Committee annually undertakes a compensation risk assessment to establish whether our compensation program is successfully achieving these objectives, while aligning pay with performance. The 2022 review concluded that our compensation program, particularly our cash incentive plans and long-term incentives, appropriately balance risk, pay-for-performance, and the desire to focus executives on specific financial and operational measures. The Compensation and Human Capital Committee believes our program does not encourage unnecessary or excessive risk-taking, nor does it create risks that are reasonably likely to have a material adverse effect on the Company.
Corporate Website
We maintain a “Governance” section on our website at https://investors.ehab.com where you can find copies of our principal governance documents, including:
•Certificate of Incorporation and Amended and Restated Bylaws;
•Charters of each of the standing committeescommittee of the Board;
•Standards of Business Conduct and Ethics;Corporate Governance Guidelines;
•Corporate Governance Guidelines;Standards of Business Ethics and Conduct;
•Incentive Compensation Recoupment Policy; and
•Insider Trading Policy.

97

Board Structure and Committees
Board Structure and Meetings
Our business, property, and affairs are managed under the direction of our Board. Our Corporate Governance Guidelines provide for an independent director to serve as the non-executive chairman of the Board who sets the agenda for, and presides over, Board meetings, coordinates the work of the committees of our Board, oversees the distribution of materials to members of the Board and performs other duties delegated to the chairman by the Board. The non-executive chairman also presides over independent sessions generally held at each Board meeting. The Board adopted this structure to promote decision-making and governance independent of that of our management and to better perform the Board’s monitoring and evaluation functions. Members of the Board are kept informed of our business through discussions with our chief executive officer and other officers, by reviewing materials provided to them by visiting our offices and facilities, and by participating in meetings of the Board and its committees.
TheDuring 2023, the Board hashad the five standing committees set out in the table below, eachbelow. In February 2024, the Board combined the Audit Committee and Finance Committee and changed the name of whichthe “Compliance/Quality of Care Committee” to the “Care, Compliance & Cybersecurity Committee.” Each Board committee is led by a different independent director, and all members of our Board committees are independent directors. Each committee is governed by a charter and reports its actions and recommendations to the full Board. Each committee has the authority to retain, at the expense of the Company, outside advisors, including consultants and legal and accounting advisors. The following table shows the membership of each Board committee asduring 2023. As of May 1, 2023.April 2024, membership of the Audit Committee (now the Audit & Finance Committee), Compensation & Human Capital Committee, Care, Compliance & Cybersecurity Committee, and Nominating & Corporate Governance Committee has not changed.
DirectorAuditCompensation and& Human CapitalCompliance/
Quality of
Care, Compliance & Cybersecurity		FinanceNominating/Nominating &
Corporate
Governance
Jeffrey W. BoltonXX
Tina L. Brown-StevensonXX
Yvonne M. CurlChairX
Charles M. ElsonChairChairX
Leo I. Higdon, Jr.ChairXX
Erin P. HoeflingerXX
John E. Maupin, Jr.XChair
Susan A. LaMonicaLa MonicaXXX
Stuart M. McGuigan(1)
XX
Gregory S. RushXChairXX
Barry P. SchochetXX
L. Edward Shaw, Jr.XChair
(1) Mr. McGuigan was appointed to the Board of director March 30, 2023. The Board intends to appoint Mr. McGuigan toand each committee met the Compliance/Qualityfollowing number of Care Committeetimes in during 2023. All directors attended more than 80% of Board meetings and Nominating/Corporate Governance Committee in its May 2023 Board meeting.100% of all committees meetings.
BoardAuditCompensation & Human CapitalCare, Compliance & CybersecurityFinanceNominating &
Corporate
Governance
Meetings1996554
8


Audit Committee
The Audit Committee’s purpose, per the terms of its charter, is to assist the Board in fulfilling its responsibilities to the Company and its stockholders, particularly with respect to the oversight of the accounting, auditing, financial reporting, and internal control and compliance practices of the Company. The specific responsibilities of the Audit Committee are, among others, to:
•assist the Board in the oversight of the integrity of our financial statements and compliance with legal and regulatory requirements, the qualifications and independence of our independent auditor, and the performance of our internal audit function and our independent auditor;
•appoint, compensate, replace, retain, and oversee the work of our independent auditor;
•at least annually, review a report by our independent auditor regarding its internal quality control procedures, material issues raised by certain reviews, inquiries or investigations relating to independent audits within the last five years, and relationships between the independent auditor and the Company;
•review and evaluate our quarterly and annual financial statements with management and our independent auditor, including management’s assessment of and the independent auditor’s opinion regarding the effectiveness of our internal control over financial reporting;
•discuss with management earnings press releases as well as financial information and earnings guidance provided to analysts and rating agencies with management;agencies;
•discuss policies with respect to risk assessment and risk management; and
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•appoint and oversee the activities of our DirectorVice President of Internal Audit, who has the responsibility to identify violations of Company policy and law relating to accounting or public financial reporting.
The Board has also determined that each Audit Committee member is “financially literate” as defined by the New York Stock Exchange (“NYSE”) and has accounting or related financial management expertise, and that Mr. Rush is an audit committee “financial expert” as defined by the SEC.
Compensation and& Human Capital Committee
The Compensation and& Human Capital Committee’s purpose and objectives are to attract and retain high-quality personnel to better ensure the long-term success of the Company and the creation of long-term shareholder value. Accordingly, this committee oversees our compensation and employee benefit objectives, plans and policies and approves, or recommends to the independent members of the Board for approval, the individual compensation of our executive officers. This committee also reviews our human capital strategy and management activities, such as employee and management recruiting, retention and development initiatives as well as diversity, equity and inclusion initiatives. For further discussion of our human capital management, see Item 1, Business, of our Annual Report on Form 10-K for the year ended December 31, 2022.
The specific responsibilities of this committee are, among others, to:
•review and approve our compensation programs and policies, including our benefit plans, incentive compensation plans and equity-based plans and administer those plans as may be required;
•review and approve (or recommend to the Board in the case of the chief executive officer) goals and objectives relevant to the compensation of the executive officers and evaluate their performances in light of those goals and objectives;
•determine and approve (together with the other independent directors in the case of the chief executive officer) the compensation levels for the executive officers;
•review and discuss with management the Compensation Discussion and Analysis and recommend inclusion thereof in our annual report or proxy statement;
•review and approve (or recommend to the Board in the case of the chief executive officer) employment arrangements, severance arrangements and termination arrangements and change in control arrangements to be made with any executive officer;
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•review at least annually our management succession plan as it relates to compensation and benefits;
•oversee long-term succession plans for senior management;
•review at least annually material compensation and human capital related risk exposures as well as management’s efforts to monitor and mitigate those exposures; and
•review and recommend to the Board the compensation for the non-employee members of the Board.
The Compensation and Human Capital Committee Report appears here in this Form 10-K/A.
In July 2021, the Compensation and Human Capital Committee conducted a request for proposal process and sought proposals from several national compensation consultants. The committee then engaged Pay Governance as its independent compensation consultant to assist it in its review and evaluation of executive compensation practices. The committee has reviewed the independence of Pay Governance and of each individual employee of the firm with whom it works. Pay Governance does not perform other services for the Company. The committee has determined Pay Governance has no conflict of interest in providing advisory services.
Compliance/Quality of Care, Compliance & Cybersecurity Committee
The Compliance/Quality of Care, Compliance & Cybersecurity Committee’s function is to assist our Board in fulfilling its fiduciary responsibilities relating to our regulatory compliance and cyber risk management activities and to ensure we deliver quality care to our patients. The committee is primarily responsible for overseeing, monitoring, and evaluating our compliance with all of its regulatory obligations other than tax and securities law-related obligations and reviewing the quality of services provided to patients. The specific responsibilities of the Compliance/Quality of Care, Compliance & Cybersecurity Committee are, among others, to:
•ensure the establishment and maintenance of a regulatory compliance program and the development of a comprehensive quality of care program designed to measure and improve the quality of care and safety furnished to patients;
•appoint and oversee the activities of a chief compliance officer and compliance office with responsibility for developing and implementing our regulatory compliance program;
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•oversee the cyber risk management program designed to monitor, mitigate and respond to cyber risks, threats, and incidents, and review periodic reports from the chief information officer, including developments in cyber threat environment and cyber risk mitigation efforts; and
•review periodic reports from the chief compliance officer, including an annual regulatory compliance report summarizing compliance-related activities undertaken by us during the year, and the results of all regulatory compliance audits conducted during the year; and
•review and approve annually the quality of care program and review periodic reports from the chief medical officer regarding our efforts to advance patient safety and quality of care.year.
Finance Committee
The purpose and objectives of the Finance Committee are to assist our Board in the oversight of the use and development of our financial resources, including our financial structure, investment policies and objectives, and other matters of a financial and investment nature. The specific responsibilities of the Finance Committee are, among others, to:
•review and approve certain expenditures, contractual obligations and financial commitments per delegated authority from our Board; and
•review, evaluate, and make recommendations to the Board regarding (i) capital structure and proposed changes thereto, including significant new issuances, purchases, or redemptions of our securities, (ii) plans for allocation and disbursement of capital expenditures, (iii) credit rating, activities with credit rating agencies, and key financial ratios, (iv) long-term financial strategy and financial needs, (v) major activities with respect to mergers, acquisition and divestitures, and (vi) plans to manage insurance and asset risk.
Nominating/Nominating & Corporate Governance Committee
The purposes and objectives of the Nominating/Nominating & Corporate Governance Committee are to assist our Board in fulfilling its governance duties and responsibilities to our stockholders. Specific responsibilities include, among others, to:
•oversee the emergency succession plans for the chief executive officer;
•recommend nominees for Board membership to be submitted for stockholder vote at each annual meeting, and to recommend to the Board candidates to fill vacancies on the Board and newly-created positions on the Board;
•review and make recommendations on the size and composition of the Board and assist the Board in determining the appropriate characteristics, skills and experience for the individual directors and the Board as a whole and create a process to allow the committee to identify and evaluate individuals qualified to become Board members;
•evaluate annually and make recommendations to the Board regarding the composition of each standing committee of the Board, the policy with respect to rotation of committee memberships and chairs, and the functioning of the committees;
•review the suitability for each Board member’s continued service as a director when his or her term expires, and recommend whether or not the director should be re-nominated;
•assist the Board in considering whether a transaction between a Board member and the Company presents an inappropriate conflict of interest and/or impairs the independence of any Board member and conduct a prior review of any such transaction; and
•develop Corporate Governance Guidelines that are consistent with applicable laws and listing standards, periodically review those guidelines, and recommend to the Board any changes the committee deems necessary or advisable.
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Compensation of Directors
Pursuant to its charter, the Compensation and Human Capital Committee evaluates the compensation of our non-employee directors, including the respective chairperson fees, and recommends any changes it deems advisable to the Board, which is responsible for adopting the final form and amount of non-employee director compensation. As part of its annual review, the Compensation and& Human Capital Committee receives comparative peer and industry data and recommendations from its independent compensation consultant, Pay Governance.
In connection with the Separation, the Company granted founder RSU awards to Messrs. Higdon, Elson, Maupin, and Shaw, and Ms. Curl with a grant date fair value of $187,500. In addition theThe Company granted each non-employee director an RSU award with a grant date fair value of $150,000 as annual compensation. The RSUs held by each director vestannual equity grant vests upon grant and will be settled in shares of our common stock following the director’s departure from the Board.
In 2022,2023, we provided the following compensation to our non-employee directors:
Name (1)
Fees Earned
or Paid
in Cash ($)(2)
Stock  
Awards  
($)(3)  
All Other
Compensation
($)		Total ($)
Leo I. Higdon, Jr.131,250337,530—468,750
NameNameFees Earned
or Paid
in Cash
($)		Stock  
Awards  
($)(3)  		All Other
Compensation
($)		Total
($)
Leo I. Higdon, Jr., ChairpersonLeo I. Higdon, Jr., Chairperson162,500150,011—312,511
Jeffrey W. BoltonJeffrey W. Bolton56,250150,016—206,250Jeffrey W. Bolton75,000150,011—225,011
Tina L. Brown-StevensonTina L. Brown-Stevenson56,250150,000—206,250Tina L. Brown-Stevenson75,000150,011—225,011
Yvonne M. CurlYvonne M. Curl71,250337,530—408,780Yvonne M. Curl95,000150,011—245,011
Charles M. ElsonCharles M. Elson67,500337,530—405,030Charles M. Elson90,000150,011—240,011
Erin P. HoeflingerErin P. Hoeflinger56,250150,016—206,266Erin P. Hoeflinger75,000150,011—225,011
Susan A. La MonicaSusan A. La Monica75,000150,011—225,011
John E. Maupin, Jr.John E. Maupin, Jr.67,500337,530—405,030John E. Maupin, Jr.90,000150,011—240,011
Susan A. LaMonica56,250150,000—206,250
Stuart M. McGuigan(1)
Stuart M. McGuigan(1)
56,250175,014—231,264
Gregory S. Rush(2)Gregory S. Rush(2)56,250150,016—206,266Gregory S. Rush(2)91,667150,011—241,678
Barry P. Schochet(1)
Barry P. Schochet(1)
56,250175,014—231,264
L. Edward Shaw, Jr.L. Edward Shaw, Jr.71,250337,530—408,780L. Edward Shaw, Jr.95,000150,011—245,011
(1)Mr. McGuigan and Mr. Schochet joined the Board on March 30, 2023.2023 and received a pro-rata portion of the prior year’s annual equity grant in addition to the 2023 annual equity grant. The grant date fair value of each pro-rated equity grant,computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 ("ASC 718"), was $25,002.
(2)The amounts reflectedMr. Rush was appointed Chairperson of the Audit Committee in this column are the retainer and chairperson fees earned for service as a director for 2022, regardless of when such fees are paid.May 2023.
(3)Each non-employee director received awards of restricted stock units, or RSUs, with a grant date fair value computed in accordance with Accounting Standards Codification 718, Compensation - Stock Compensation.ASC 718. The number of Enhabit RSUs granted was calculated by dividing the grant datetarget value by the closing trading price of Enhabit common stock on the NYSE on the date of grant.
AwardGrant DatePrice per Share
($)		Number of Shares
(#)		Grant Date Value
($)
Founders Award(a)7/1/202222.748,246187,514
Annual Retention Award(b)7/1/202222.746,597150,016
Annual Retention Award(c)7/15/20218.538,095150,000
a.Messrs. Higdon, Elson, Maupin, and Shaw and Ms. Curl received a founders award on July 1, 2022.
b.Messrs. Higdon, Bolton, Elson, Maupin, Rush and Shaw, and Mmes. Curl and Hoeflinger received annual retention award on July 1, 2022.
c.Ms. LaMonica and Ms. Brown-Stevenson received annual retention award on July 15, 2022.
Our non-employee directors received an annual base cash retainer of $75,000. We also paid the following chairperson fees to compensate for the enhanced responsibilities and time commitments associated with those positions:
ChairChairperson PositionChairperson Fees Earned or  Paid in Cash 
($)
Chairman of the Board75,000
Audit Committee25,000
Compensation and& Human Capital Committee20,000
Compliance/Quality of Care, Compliance & Cybersecurity Committee15,000
Finance Committee(1)
15,000
Finance Committee15,000
Nominating/Nominating & Corporate Governance Committee20,000
   (1) In February 2024, the Board combined the Audit Committee and Finance Committee.

It is expected that each non-employee member of the Board will receive an annual grant of restricted stock units valued at approximately $150,000. The restricted stock units held by each director will be settled in shares of our common stock following the director’s departure from the Board.
Ms. Jacobsmeyer received no additional compensation for serving on the Board.
1311

Delinquent Section 16(a) Reports
Section 16(a) of the Exchange Act requires our directors, executive officers, and the persons who beneficially own more than 10% of our common stock, to file reports of ownership and changes in ownership with the Securities and Exchange Commission. Copies of all filed reports are required to be furnished to us. Based solely on the reports received by us and on the representations of the reporting persons, we believe that these persons have complied with all applicable filing requirements during 2023, except those that were disclosed in our Form 10-K/A for the year ended December 31, 2022, filed on May 1, 2023, which were not timely filed.

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Item 11. Executive Compensation
Compensation Discussion and Analysis
The Company completed its first full year operating as a standalone public company in 2023, following its Separation from Encompass in July 2022. Prior to the Separation, the compensation structure for senior management was determined under the compensation philosophy, programs, and practices of Encompass and by Encompass’ compensation committee. Following the Separation, the Company’s Compensation and Human Capital Committee (the “Compensation Committee”), in consultation with its independent advisors and management, reviewed and revised historical programs and practices to align with the Company’s market capitalization, capital structure, revenues, industry, employee population and goals as a standalone entity. The Compensation Committee concentrated on performance goals and metrics in the senior management bonus plan and the long-term equity incentive plan and peer alignment in the overall compensation program.
This Compensation Discussion and Analysis (CD&A) describes the philosophy, objectives, principles and components of the material elements of the Company’s executive compensation program and describes the 2023 compensation for the Company’sour Named Executive Officers (“NEOs”). Prior to the Separation, we operated as a wholly-owned subsidiary of Encompass.As a result, because the Separation did not occur until July 1, 2022, the 2022 compensation structure for our NEOs was determined prior to the Separation under the historical compensation philosophy, programs and practices of Encompass. This CD&A addresses the pre-Separation decisions made by Encompass as well as the impact of the Employee Matters Agreement on NEO compensation. In addition, this CD&A describes certain decisions made by our newly formed Compensation and Human Capital Committee following the Separation that impacts both 2022 and 2023 compensation. Our NEOs for 20222023 are:

NameTitle
Barbara A. JacobsmeyerPresident and Chief Executive Officer
Crissy B. CarlisleExecutive Vice President and Chief Financial Officer
Jeanne KalvaitisExecutive Vice President, Hospice Operations
Julie JolleyExecutive Vice President, Home Health Operations
Tanya MarionChief Human Resources Officer
Chad K. KnightDylan C. Black1(1)
General Counsel and Secretary
Julie D. JolleyExecutive Vice President of Home Health
Tanya R. MarionChief Human Resources Officer
(1) Mr. Knight resigned from his position as General Counsel effective as of November 4, 2022.Black joined the Company in January 2023.
The NEOs received compensation for their services only from, prior to the Separation, Encompass, and following the Separation, the Company. This proxy statement sets forth the combined compensation paid by both Encompass and the Company to each of the NEOs with respect to compensation earned in 2022.
The Compensation and Human Capital Committee of the board of directors of Encompass (the “Encompass Compensation Committee”) reviewed and approved the compensation programs and policies, including incentive compensation plans and equity-based plans, applicable to our NEOs in 2022. The Encompass Compensation Committee also specifically reviewed and determined the compensation of Ms. Jacobsmeyer, who was an executive officer of Encompass in 2022 prior to the Separation. Because Ms. Carlisle, Ms. Jolley, Ms. Kalvaitis, Ms. Marion and Mr. Knight were not executive officers of Encompass in 2022, their compensation was determined by Encompass’s senior management consistent with Encompass’s compensation philosophy and reviewed by the Encompass Compensation Committee in anticipation of the Separation.
EXECUTIVE SUMMARY
During 2022, the Company addressed many challenges as itAs we transitioned from a business unit of Encompass Health Corporation to a standalone public company. Thesecompany, the Company managed through challenges included continuingfacing the industry, including shifts in thehome health payor mix, increasing labor costs as a result of competition for nurses and other effects of inflation.healthcare professionals, shifting workforce expectations and demands, and home health Medicare reimbursement rates. Despite these challenges, the Company remained focused on continuing to provide high qualityhigh-quality service to our patients.patients and meeting operational goals.
20222023 Operational Achievements:
•Separation from Encompass Health Corporation on July 1, 2022
•Established a payor innovation team and increased our focus on profitableDeveloped relationships with Medicare Advantage plans at improved rates. Our payor innovation team negotiated 41 new agreements, including two new national agreements in 2023. Our quality of care outcomes have been a strong value proposition in our successful negotiations.
•Made strategic changesExecuted on our people strategy. We hired 597 net new full-time nurses, eliminated all agency nursing contract labor, and implemented the hospice case management staffing model. At the end of 2023, we had no staffing-constrained hospice locations and eliminated nursing contract labor usage in hospicehome health and hospice.
•Strategically reinvested for growthOpened eight de novo locations. Two additional locations were pending regulatory approval at the end of 2023.
•Realigned field salesDelivered high-quality outcomes for our patients. Our 30-day hospital readmission rate was 20.5% better than the national average, and operations teamsour hospice visits in the last days of life was 53.2% better than the national average.
•Revised human capital policies and added the Company’s first Chief Human Resources Officer
20222023 Financial Performance:
•Delivered 20222023 consolidated net revenue of $1,071.1$1,046.3 million
•Delivered 20222023 Adjusted EBITDA of $149.3$97.6 million
2023 Quality of Care Performance:
•Met or exceeded all of our key quality of care performance metrics:
14
13

2022•60-Day Home Health Acute Care Hospitalization Rate
•Hospice Revocation Rate
•Home Health Patient and Family Experience
•Hospice Patient and Family Experience
2023 Incentive Compensation Plan Outcomes
•TheBased on achievement of our quality of care performance, our Senior Management Bonus Plan (“SMBP”), which is our short-term annual short-term senior management bonusperformance plan, performance achievement was 38.6%paid out at 52.5% of targettarget.

EXECUTIVE COMPENSATION PHILOSOPHY
The 2022Company’s people strategy is to win the talent war by attracting, rewarding and investing at all levels in our organization, including our executive officers. Our 2023 compensation programs were designed by Encompass pursuant to Encompass's compensation philosophy. Accordingly, the following discussion is largely a review of those programs implemented and compensation decisions made prior to the Separation.
Encompass’s stated executive compensationprogram philosophy used in determining the compensation of our NEOs is to:builds off this strategy by:
•provideproviding a competitive rewards program for senior management that aligns management’s interests with those of itsthe Company’s long-term stockholders;
•correlatecorrelating compensation with corporate, regional and business unit outcomes by recognizing performance with appropriate levels and forms of awards;
•establishestablishing financial and operational goals to sustain strong financial and quality of care performance over time; and
•placeplacing 100% of annual cash incentives and a majority of equity incentive awards at risk by directly linking those incentive payments and awards to the Company’s performance; andperformance.
•provide limited executive benefits to members of senior management.
Encompass has stated that it believesWe believe this philosophy enables itus to attract, motivate, and retain talented and engaged executives who will enhance long-term stockholder value.
In connection with the Separation, the Enhabit Board formed the Company’s Compensation and Human Capital Committee (the “Enhabit Compensation Committee”). The Enhabit Compensation Committee, in consultation with its independent advisoradvisors and management, reviseddesigned the compensation philosophy and programs for 2023 to matchalign with the Company’s objectives as a stand-alone public company. Certainobjectives.
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Compensation Best Practices
To ensure the Company has strong corporate governance and risk mitigation, we have adopted the following best practices related to executive compensation:
What We DoWhat We Don’t Do
üEmphasis on performance-based variable compensationüNo perquisites for executive officers
üMajority of long-term incentive awards are performance-basedüNo “single-trigger” vesting for equity awards in the event of a change in control
üShort-term incentive plan includes both financial and quality of care metricsüNo hedging or pledging of Company stock
üRobust stock ownership requirements for officers and directorsüNo tax gross-ups on termination payments related to a change in control
üConduct annual review of our compensation peer group and competitiveness of executive compensationüNo dividends paid on unvested equity awards
üCash severance provisions aligned with market practicesüNo defined benefit pension plans for executives
ü“Double-trigger” vesting for equity awards in the event of a change in controlüNo option repricing
üCapped incentive payouts in performance plans
üDodd-Frank compliant clawback policy, plus a supplemental policy that permits recoupment in the event of certain misconduct (even in the absence of a financial restatement)
üCompensation Committee comprised solely of independent directors
üProactive stockholder engagement
üIndependent compensation consultant
Say-on-Pay Vote
The annual say-on-pay vote is one of these changes are described below under “Executiveour opportunities to receive feedback from stockholders regarding our executive compensation program, and our Compensation Program Details and Changes forCommittee takes the result of this vote into account when determining the compensation of the Company’s executive officers. At our 2023 annual stockholders’ meeting, our stockholders approved our say-on-pay proposal, with over 82% of shares voting (excluding broker non-votes) to approve.

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”.
Target Pay Opportunities for NEOs
The Company’s executive compensation program is designed to provide a strong correlation between pay and performance. “Pay” refers to the value of an executive’s total direct compensation, or “TDC,” calculated as follows:


Base Salary+Target Annual Incentives+Target Long-Term Equity Incentives=Target Total Direct Compensation

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NEO Target Total Direct Compensation
Named
Executive
Officer		Base Salary
($)		Target Annual Cash Incentive
($)		Target Long-Term Equity Incentive
($)		Target Total Direct Compensation
($)
Barbara A. Jacobsmeyer(1)
800,000892,5001,875,0003,567,500
Crissy B. Carlisle400,001280,001500,0011,180,003
Julie Jolley(1)
382,500273,000187,500843,000
Jeanne Kalvaitis(2)
160,42780,214— 240,641
Tanya Marion350,002175,001262,502787,505
Chad K. Knight(1)
327,500245,000152,500725,000
(1) As described below, in anticipation of the Separation from Encompass increases were approved to the base salary and the target annual cash incentive opportunity for Ms. Jacobsmeyer, Ms. Jolly, and Mr. Knight. The table above reflects the impact of these increases for 2022.
(2) Ms. Kalvaitis joined the Company in June 2022. The amount shown as “Base Salary” and “Target Annual Cash Incentive” is pro-rated to account for 7 months of employment in 2022. Ms. Kalvaitis was not granted an LTI award in 2022.
NEO Target Total Direct Compensation for 2023
Named Executive OfficerBase Salary
($)		Target Annual
Cash Incentive
($)		Target Long-Term Equity Incentive
($)		Target Total Direct Compensation
($)
Barbara A. Jacobsmeyer
850,000892,5002,677,5014,420,001
Crissy B. Carlisle400,001280,000500,0011,180,002
Dylan C. Black(1)
350,000245,000350,000945,000
Julie D. Jolley390,000273,000390,0001,053,000
Tanya R. Marion350,002175,001262,501787,504
(1) Mr. Black, the Company’s General Counsel and Secretary, joined the Company January 2023.
In 2022,2023, all cash incentive target amounts and a substantial portion of NEO equity award values were dependent on performance measured against predetermined objectives approved by the Encompass Compensation Committee prior to the Separation.Committee. The graphscharts below reflect: (i) the portion of our NEOs’ 20222023 target TDC that is performance-based and (ii) the time frame (i.e., annual vs. long-term) for our NEOs to realize value under our various TDC components.
President & Chief Executive Officer (Jacobsmeyer)
67% Performance-Based
Base PayAnnual Cash IncentiveOptionsPSURSA
22%25%11%32%11%
53% Long-Term
President & Chief Executive Officer (Jacobsmeyer)
69% Performance-Based
Base SalaryAnnual Cash IncentiveOptionsPSURSU
19%20%12%37%12%
61% Long-Term
Average for Other NEOs(1)
46% Performance-Based
Base PayAnnual Cash IncentivePSURSA
41%28%19%12%
31% Long Term
(1) Excludes Ms. Kalvaitis.
Note: Numbers may not add to 100% due to rounding.
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Compensation Best Practices
To ensure the Company has strong corporate governance and risk mitigation, the Enhabit Board also adopted the following best practices related to executive compensation:
üEmphasis on performance-based variable compensationXNo significant perquisites
üMajority of long-term incentive awards are performance-basedXNo “single-trigger” vesting for equity awards in the event of a change in control
üShort-term incentive plan includes both financial and quality of care (ESG) metricsXNo hedging or pledging of Company stock
üRobust stock ownership requirements for officers and directors implemented in 2022XNo tax gross-ups on termination payments related to a change in control
üConduct annual review of peer group and competitiveness of executive compensationXNo dividends paid out on unvested restricted or performance shares
üCash severance provisions aligned with market practicesXNo defined benefit pension plans for executives
ü“Double-trigger” vesting for equity awards in the event of a change in controlXNo option repricing
üCompensation recoupment, or “claw-back,” policy applies to both cash and equity incentives and covers misconduct in some cases where a financial restatement has not occurred
üCompensation Committee comprised solely of independent directors
üProactive stockholder engagement
üIndependent compensation consultant
Average for Other NEOs
47% Performance-Based
Base SalaryAnnual Cash IncentivePSURSU
38%24%23%15%
38% Long-Term

Say-on-Pay Vote
The Compensation and Human Capital Committee and management of the Company will consider stockholder input, including the advisory Say-on-Pay vote, as it evaluates the design of executive compensation programs and the specific compensation decisions for each NEO. As a new publicly-traded company as of July 1, 2022, the first Say-on-Pay vote will be held at our 2023 Annual Meeting.
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DETERMINATION OF COMPENSATION
Compensation Objectives
Prior to the Separation, the EncompassThe Compensation Committee’s objectives wereare to provide competitive target compensation to attract and retain the kind of executive talent necessary to achieve the Company’s strategic objectives and to ensure incentive plan (annual and long term)long-term) outcomes are aligned with Company performance. Executives may achieve above-target actual compensation for exceptional performance relative to these target performance goals and below-target levels of compensation for performance that is not as strong as expected.
Use of Compensation Consultants
Prior to the Separation, in making compensation decisions for 2022, the Encompass Compensation Committee received recommendations from Encompass’s chief executive officer and support from Encompass’s human resources staff. Additionally, for 2022, the EncompassThe Compensation Committee engaged Pay Governance as its independent executive compensation consultant. EncompassThe Company’s management separately engaged Mercer (US) Inc. (“Mercer”) to provide data and analysis on competitive executive and non-executive compensation practices. Mercer data on executive compensation practices was provided to the Encompass Compensation Committee, subject to review by, and input from, Pay Governance.
Following the Separation, the Company’s Compensation Committee separately engaged Pay Governance to serve as its independent compensation consultant. Pay Governance provided independent executive compensation advice and support to our Compensation Committee during 2022 and assisted with developing our compensation programs for 2023.
Assessment of Competitive Compensation Practices
PriorTo maintain a market-competitive program, the Compensation Committee reviewed compensation data from the surveys noted below as well as proxy-reported data from the compensation peer group.
Compensation Survey Sources
sMercer Benchmark DatabasesAon Hewitt Executive
sMercer Integrated Health NetworkssWillis Towers Watson Executive
For the purposes of setting 2023 compensation, our Company’s compensation peer group, as reviewed and approved by the Compensation Committee, included the following 16 companies:
2023 Compensation Peer Group
sAddus HomeCare CorporationsCross Country Healthcare, Inc.sPediatrix Medical Group, Inc.
sAmedisys, Inc.sInnovAge Holding Corp.sThe Ensign Group, Inc.
sAMN Healthcare Services, Inc.sLHC Group, Inc.sThe Pennant Group, Inc.
sAvenna Healthcare Holdings, Inc.sModivCare, Inc.sPremier, Inc.
sChemed CorporationsNational HealthCare CorporationsSignify Health, Inc.
sSurgery Partners, Inc.
The Compensation Committee’s goal in selecting its compensation peer group is to select a group that acts as an appropriate frame of reference for compensation benchmarking. The Compensation Committee selected the Separation,2023 compensation peer group using the following criteria as a guide:
•Company Type / Geography: publicly-traded on a major U.S. exchange and headquartered in the U.S.
•Industry: healthcare services or health care facilities with a focus on companies providing home health, hospice, personal care and nursing/physician staffing/services
•Revenues: approximately 0.4 to 2.5 times Enhabit’s revenue
•Market Capitalization: less than 4.0 times Enhabit’s market capitalization
•Numerous Qualitative Factors: examples include number of employees, competitor for talent, proxy advisor-defined peers, and states of operations
The Compensation Committee considered a number of factors were considered by Encompass and, with respect to Ms. Jacobsmeyer, the Encompass Compensation Committee, in determining the base salaries, annual incentive opportunities, and long-term incentive awards of our NEOs for 2022,2023, including the executive’s experience and role in executing day-to-day responsibilities aspects of the role that are unique to Encompass and the Company, the executive’s experience,along with executing longer-term standalone public company strategic goals, internal equity within seniorexecutive management, and the executive’s performance, and competitive market data.
With respect to Ms. Jacobsmeyer’s compensation as an executive officer of the Company, the Encompass performance. TheCompensation Committee also reviewed the compensationcompetitive data from the surveys noted below. The compensation survey data provided the Encompass Compensation Committee a significant sample size, included information for management positions below senior executives, and included companies in healthcare and other industries from which we might recruit for executive positions. In addition, prioraforementioned sources related to the Separation, the Encompass Compensation Committee approved a compensation peer group specific for Enhabit, which differed from the peer group used for Encompass. The Encompass Compensation Committee reviewed compensation peer group data assembled by Pay Governance from the peer group companies listed below.
Compensation Survey Sources
sMercer Benchmark DatabasesAon Hewitt Executive
sMercer Integrated Health NetworkssWillis Towers Watson Executive
2022 Compensation Peer Group
sAcadia HealthcaresDaVitasQuest Diagnostics
sAmedisyssEnsign GroupsModivCare
sAMN HealthcaresLHC GroupsSelect Medical Holdings
sBrookdale Senior LivingsMednaxsSurgery Partners
sChemedsPremiersUniversal Health Systems

The Encompass Compensation Committee reviewed competitive data on base salary levels, annual incentives, and long-term incentives for each executive and the NEO group as a whole. In preparation for 2022For 2023 compensation, decisions for Ms. Jacobsmeyer, the Encompass Compensation Committee reviewed total
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direct compensation opportunities at the 25th, 50th and 75th percentiles of the survey data and the compensation peer group data (“market data”) and established target total direct compensation that was within a competitive range of the market median.
It is important to note the Encompass Compensation Committee, with input from its advisor, recognizes the benchmark data changes from year to year so the comparison against those benchmarksand places emphasis on sustained compensation trends to avoid short-term anomalies. In general, the Encompass Compensation Committee views compensation 10%15% above or below the 50th percentile to be within a competitive range given year to year variability in the data.
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With respect to Ms. Carlisle’s, Ms. Jolley’s, Ms. Marion’s, and Mr. Knight’s compensation, Encompass senior management established the target total direct compensation using a framework similar to the one used above by the EncompassThe Compensation Committee with reference to individual and company performance,revised the compensation survey data and, as available, peer group for 2024 compensation data.to align more closely with peer median revenue. Specifically, AMN Healthcare Services, Inc., Surgery Partners, Inc., and Chemed Corporation have been removed and America Oncology Network, Inc., P3 Health Partners Inc., LifeStance Health Group, Inc., U.S. Physical Therapy, Inc., and DocGo Inc. have been added. Additionally, LHC Group, Inc. and Signify Health, Inc. have been removed due to acquisition.
ELEMENTS OF EXECUTIVE COMPENSATION

Component		Purpose
Base SalaryProvide our executives with a competitive level of fixed pay.
Annual IncentivesIntended to drive Company performance during the applicable year.
Long-Term Equity IncentivesIntended to focus executive attention on longer-term strength of the business and align their interests with our stockholders over a multiyear period.
Health and Welfare BenefitsProvide our executives with programs that promote health and financial security, which all eligible employees receive.


The primary elements of our executive compensation program are:
Base Salary+Annual Incentives+Long-Term Equity Incentives
ComponentPurpose
Base SalaryProvide our executives with a competitive level of fixed pay.
Annual Cash IncentivesIntended to drive Company performance during the applicable year.
Long-Term Equity IncentivesIntended to focus executive attention on longer-term strength of the business and align their interests with our stockholders’ interests over a multiyear period.
Health and Welfare BenefitsProvide our executives with programs that promote health and financial security, which all eligible employees receive.
Base Salary
We provide officers and other employees with base salaries to compensate them with regular income at competitive levels. The Encompass Compensation Committee reviews base salaries annually for its executive officers, including Ms. Jacobsmeyer.officers. The Compensation Committee considered market data, each individual’s experience and responsibilities, achievement of performance objectives, internal equity, and recommendations provided by the CEO for her direct reports. Base salaries for our other NEOs were set annually by Encompass senior management. The table below shows base salarieshave not increased since the Separation in effect on January 1, 2022. In connection with our Separation from Encompass, the Encompass Compensation Committee increased the base salaries of Ms. Jacobsmeyer, Ms. Jolly,July 2022 and Mr. Knight to better align their total target compensation with the market considering their experience and the increased responsibilities of their positions at a public company.will not increase in 2024.

Named Executive OfficerAnnual Base Salaries as of January 1, 2022
($)		Annual Base Salaries as of July 1, 2022
($)
Barbara A. JacobsmeyerPresident and Chief Executive Officer750,000850,000
Crissy B. CarlisleExecutive Vice President and Chief Financial Officer400,001400,001
Julie JolleyExecutive Vice President, Home Health Operations375,000390,000
Jeanne Kalvaitis(1)
Executive Vice President, Hospice Operations275,018275,018
Tanya Marion(2)
Chief Human Resources Officer350,002350,002
Chad K. Knight(3)
General Counsel and Secretary305,000350,000
Named Executive OfficerAnnual Base Salary Rates as of December 31, 2023
($)
Barbara A. Jacobsmeyer850,000
Crissy B. Carlisle400,001
Dylan C. Black350,000
Julie D. Jolley390,000
Tanya R. Marion350,002
(1) Ms. Kalvaitis was hired in June 2022. Upon hire, Ms. Kalvaitis’s base salary was $275,018.
(2) Ms. Marion was hired in January 2022. Upon hire, Ms. Marion’s base salary was $350,002.
(3) Mr. Knight resigned from his position as General Counsel effective as of November 4, 2022.
Annual Incentives
Establishing the Target Annual Incentive Opportunity
The Encompass 2022Our 2023 Senior Management Bonus Plan (the “Encompass SMBP”“SMBP”) was designed to incentivize and reward our NEOs and others for annual performance as measured against predetermined corporate and business segment quantitative objectivesmetrics intended to improve company performance and promote stockholder value.create value for our stockholders. Under the SMBP, a target annual incentive opportunity, which isexpressed as a percentage of base salary, is determined for each participant.

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In connection with our Separation, and pursuant to the Employee Matters Agreement, the short-term incentive awards previously granted to the Company’s employees under the Encompass SMBP remained in place for the first half of 2022. At the time of Separation, target incentive opportunities for certain NEOs were adjusted by the Encompass Compensation Committee to align such NEOs’ target TDC with the market considering their experience and the increased responsibilities of their positions at a public company and the metrics were adjusted to apply to the Company’s results for the second half of 2022. These 2022 awards are paid in cash and were paid by the Company in 2023 upon approval of the performance results.

January 1, 2022July 1, 2022
Named Executive OfficerBase Salary
($)		Target Incentive Opportunity (%)Target Annual Incentive
($)		Base Salary
($)		Target Incentive Opportunity (%)Target Annual Incentive
($)
Barbara A. Jacobsmeyer750,00085%637,500850,000105%892,500
Crissy B. Carlisle400,00170%280,001400,00170%280,001
Julie Jolley375,00050%187,500390,00070%273,000
Jeanne Kalvaitis275,01850%137,509275,01850%137,509
Tanya Marion350,00250%175,001350,00250%175,001
Chad K. Knight30500040%122,000350,00070%245,000
Named Executive OfficerBase Salary
($)		Target Incentive Opportunity
(%)		Target Cash Annual Incentive
($)
Barbara A. Jacobsmeyer850,000105 %892,500
Crissy B. Carlisle400,00170 %280,001
Dylan C. Black350,00070 %245,000
Julie D. Jolley390,00070 %273,000
Tanya R. Marion350,00250 %175,001
Plan ObjectivesMetrics and MetricsGoals
For 2022,2023, the Encompass Compensation Committee approved two quantitative objectives:metrics: Adjusted EBITDA to focus on financial performance and a “Quality Scorecard” objectivecomprised of four sub-metrics to focus on quality-of-care metrics.

In connection with the Separation, the Enhabit Compensation Committee approved a bifurcated approach with respect to the Enhabit SMBP, such that the 2022 performance period was divided into two periods (i.e., pre and post Separation).operational performance. The first performance period, relating to the first half of the year, continued to be based on the quantitative objectives of Adjusted EBITDA on a consolidated basis, Adjusted EBITDA of the home health and hospice (“HHH”) Segment EBITDA and the Quality Scorecard, while the second performance period, relating to the second half of the year, was based on the HHH Segment EBITDA (i.e., did not take into account the Adjusted EBITDA on a consolidated basis) and the Quality Scorecard, which did not change from the first performance period. The final payments were based on the average of the weighted average results for both performance periods. The table below sets forth the quantitative objectives under the plan.
The Encompass Compensation Committee then assigned relative weightings (as a percentage of total annual incentive opportunity) to the objectives as noted below.metrics and sub-metrics. The relative weightings oftables below set forth the quantitative objectivesmetrics, goals and weightings under the 2023 SMBP, which were the same for all our NEOs in 2022.NEOs.
To reward exceptional company performance, the NEOs have the opportunity to receive a maximum payout in the event actual results reach a predetermined level of high performance for each objective.metric. Conversely, if results are less than threshold for an objective,a metric, then no payout is awarded for that objectives. such metric.
2023 SMBP Metrics and Weightings
Financial: Adjusted EBITDA70%
Quality Scorecard30%

Goals and Payout Opportunities: Adjusted EBITDA
Threshold
50%		Target
100%		Maximum
200%
$130.2 million$140.8 million$151.4 million

Goals and Payout Opportunities: Quality Scorecard

Quality Scorecard Sub-Metrics		WeightThreshold
50%		Target
100%		Maximum
200%
60 Day Home Health Acute Care Hospitalization Rate NQF #17125%14.3%14.1%13.8%
Hospice Revocation Rate25%7.5%7.0%6.5%
Home Health Patient and Family Experience25%81.0%81.2%81.4%
Hospice Patient and Family Experience25%86.0%86.2%86.4%
It is important to note the following:
•With our current performance measuresat or above national averages for the key quality performance metrics, the difficulty of achieving improved basis point changes in our quality sub-metrics explains the narrow spread between the threshold and maximum targets.
•Performance metrics can be achieved independently of each other; andother.
•asAs results increase above the threshold, a corresponding percentage of the target cash incentive will be awarded. (InIn other words, levels listed are on a continuum, and straight-line interpolation is used to determine the payout multiple between two payout levels shown in the table above.)

2019

2022 SMBP Quantitative Objectives
 Award Range
Not EligibleThresholdTargetMaximum
ObjectiveWeightSub-Weight0%50%100%200%
First Half of Year
  EHC Adjusted EBITDA20%< $486,827,499$486,827,500 $526,300,000 $565,772,500 
  HHH Segment80%
     Adjusted EBITDA70%< $108,872,499$108,872,499$117,700,000$126,527,500
     Quality Scorecard*30%
Second Half of Year
   HHH Segment100%
     Adjusted EBITDA70%< $97,957,499$97,957,499$105,900,000$113,842,500
     Quality Scorecard*30%
           * HHH Quality Scorecard Sub-
              Objective
Sub-WeightConsolidated Star/Hospice Rating
                    Home Health Quality Stars25%<3.23.23.64.0
                    Home Health Patient
                    Satisfaction Stars		25%<3.03.03.54.0
                    Hospice HIS Measures25%<3.03.04.05.0
                     Hospice CAHPS25%<3.03.04.05.0

Assessing and Rewarding 20222023 Achievement of ObjectivesGoals
After the close of the year, the Encompass Compensation Committee assessed performance against the quantitative objectivesgoals for each metric to determine a weighted average result, or the percentage of each NEOs’NEO’s target incentive that hashad been achieved, for each objective.achieved. The Enhabit2023 awards are paid in cash and were paid by the Company in early 2024 upon approval of the performance results by the Compensation committee also reviewed the recommendation.Committee. The results of Actual 20222023 SMBP Plan are as follows:
2022 EBITDA Results
Objective% of Target
Individual Objective
Achievement		Weighted Achievement
EHC Adjusted EBITDA72.3%7.2%
Enhabit Adjust EBITDA (First Half)—%—%
Enhabit Adjust EBITDA (Second Half)—%—%
Combined7.2%
2023 Adjusted EBITDA Results
Actual Performance% of Target
Achievement
$97.6 millionBelow Threshold

2022 HHH Quality Scorecard Results
Objective% of Target
Individual Objective
Achievement		WeightWeighted
Metric
Achievement		Weighted Achievement
Home Health Quality Stars125.0%25%31.3%
Home Health Patient Satisfaction Stars140.0%25%35.0%
Hospice HIS Measures200.0%25%50.0%
Hospice CAHPS—%25%—%
Combined116.3%31.4%
2023 Quality Scorecard Results
MetricWeightActual Performance% of Target
Achievement		Weighted
Metric
Achievement
60-Day Home Health
Acute Care Hospitalization Rate NQF #0171		25.0%13.8%200.0%50.0%
Hospice Revocation Rate25.0%5.8%200.0%50.0%
Home Health Patient and Family Experience25.0%81.7%200.0%50.0%
Hospice Patient and Family Experience25.0%86.2%100.0%25.0%
175.0%

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2023 SMBP Result
MetricWeight% of Target
Metric
Achievement		Weighted Achievement
Adjusted EBITDA70.0%—%—%
Quality Scorecard30.0%175.0%52.5%
52.5%

2022 SMBP - Amounts Earned
Named Executive OfficerBase Salary
($)		Target Annual Incentive Opportunity (%)Target Annual Incentive
($)		Amount of 2022 SMBP Earned (38.6%)
($)
Barbara A. Jacobsmeyer850,000105%892,500344,505
Crissy B. Carlisle400,00170%280,001108,080
Julie Jolley390,00070%273,000105,378
Jeanne Kalvaitis275,01850%137,50929,811
Tanya Marion350,00250%175,00167,550
Chad K. Knight(1)
350,00070%245,00079,488
(1) Mr. Knight resigned from his position as General Counsel effective as of November 4, 2022. His payout was pro-rata for 2022.
2023 SMBP - Amounts Earned
Named Executive OfficerBase Salary
($)		Target Annual Incentive Opportunity (%)Target Annual Incentive
($)		Amount of 2023 SMBP Earned (52.5%)
($)
Barbara A. Jacobsmeyer850,000105%892,500468,563
Crissy B. Carlisle400,00170%280,001147,000
Dylan C. Black350,00070%245,001128,626
Julie D. Jolley390,00070%273,000143,325
Tanya R. Marion350,00250%175,00191,876

Long-Term Incentives

To further align management’s interests with the interests of stockholders, Encompass reported that a significant portion of each NEOs’NEO’s total direct compensation for 20222023 was in the form of long-term equity awards. For 2022, Encompass’s2023, Enhabit’s equity incentive planprogram provided participants at all officer levels with the opportunity to earn performance-based restricted stock units, or “PSUs,” time-based restricted stock units, or “RSAs”“RSUs” and, for executive vice presidents of Encompass likeour President and CEO, Ms. Jacobsmeyer, stock options.

The following table summarizestables summarize the 20222023 target long-term equity award opportunity levels, and forms of equity compensation mix and number of awards granted for each of our NEOs. These amounts differ fromThe number of RSUs, PSUs and options granted to each NEO was determined by dividing the applicable portion of the target LTI equity award values reportedopportunity for such award type by a 20-day
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average stock price. Note that while the full number and value of PSU awards are described in this narrative, for purposes of the “2023 Summary Compensation Table (shown here) due toTable” and the utilization“Grants of a 20-day average stock price to determinePlan-Based Awards During 2023” table below, only the numberportion of sharesthe PSUs for which the performance metrics were established in 2023 are reported as granted as opposed to the grant date values used for accounting and reporting purposes.in 2023.
2022 Equity Incentive Plan Structure
Named Executive Officer(1)
Total Target
Equity Award
Opportunity
($)		Options as % of the AwardPSUs as a
% of the
Award		RSAs as a
% of the
Award
Barbara A. Jacobsmeyer1,875,00020%60%20%
Crissy B. Carlisle500,001—%60%40%
Julie Jolley187,500—%60%40%
Tanya Marion262,502—%60%40%
Chad K. Knight152,500—%60%40%
(1) Ms. Kalvaitis joined the Company in June 2022 and was not granted an LTI award in 2022.
2023 Long-Term Equity Incentive Plan Target Opportunity
Named Executive OfficerBase Salary
($)		Target LTI Equity Award Opportunity (%)Total Target
LTI Equity Award
Opportunity
($)
Barbara A. Jacobsmeyer850,000315 %2,677,501
Crissy B. Carlisle400,001125 %500,001
Dylan C. Black350,000100 %350,000
Julie D. Jolley390,000100 %390,000
Tanya R. Marion350,00275 %262,501
PSU
2023 Long-Term Equity Incentive Plan Mix and Awards
Named Executive OfficerOptions as % of the AwardAwarded OptionsPSUs as a
% of the
Award		Awarded PSUsRSUs as a
% of the
Award		Awarded RSUs
Barbara A. Jacobsmeyer20%64,11360%105,00120%35,001
Crissy B. Carlisle—%—60%19,60840%13,072
Dylan C. Black—%—60%13,72640%9,151
Julie D. Jolley—%—60%15,29540%10,197
Tanya R. Marion—%—60%10,29540%6,863
2023 Performance-Based Restricted Stock Unit Awards in 2022
Encompass reported that the EncompassThe Compensation Committee determined that performance-based vesting conditions for the majority of stock awardsPSUs granted in 20222023 were appropriate to further align leadership with the interests of stockholders and promote specific performance objectives while facilitating executive stock ownership. The PSUs entitled the NEOs to receive a predetermined range of shares upon achievement of specified performance objectives. Dividends accrue when paid on unvested shares, but the holdersThe recipients of PSUsPSU awards do not receive the cash payments related to accrued dividends until the resulting shares, if any, fully vest. If shares are earned at the end of the two-year performance period, the participant must remain employed until the end of the following year at which time the shares fully vest.

have voting rights.
For the 20222023 PSU awards, the number of shares earned will be determined at the end of a two-yearthree-year performance period based on the level of achievement of normalized earningsadjusted free cash flow per share (“FCFPS”) and relative total shareholder return (“rTSR”). The FCFPS metric is measured as an average of three, one-year performance periods: 2023, 2024, and 2025. The Compensation Committee will set the FCFPS goal for each year of the performance period at the start of such year. Given our short history as a standalone public company, the approach to use an average of three years was chosen since it is challenging to project FCFPS performance goals over a three-year performance period. TSR is measured over the full three-year performance period and is based on invested capital as defined and determined by Encompass.the percentile rank of the Enhabit total shareholder return versus the total shareholder return of the constituents in the S&P Healthcare Services Select Industry Index (as constituted on January 1, 2023) at the end of the three-year performance period. The weighting of thesethe two metrics is outlined below.
735560

2221

2023 Time-Based Restricted Stock Unit Awards in 2022
Encompass reported that aA portion of 20222023 long-term incentive award value was provided in RSAsRSUs to provide retention incentives to executives and facilitate stock ownership.ownership, which creates alignment with shareholders. The recipients of RSARSU awards do not have voting rights and rights to receive dividends. Dividends accrue when paid on outstanding shares, butwhile the holders of RSAs will not receive the cash payments related to these accrued dividends until the restricted shares fully vest.award vests. For the 2022 RSA2023 RSU award, one-third of the shares awarded vest on the first anniversary of the award,grant date, one-third of the shares vest on the second anniversary of the award,grant date, and the final third vest on the third anniversary.anniversary of the grant date.

2023 Stock Option Awards in 2022
The EncompassIn 2023, the Compensation Committee believes nonqualifiedawarded Ms. Jacobsmeyer nonqualifed stock options also are an appropriate means to align the interests of its most senior executives with its stockholders since they provide an incentive to grow stock price. options.Each stock option permits the holder, for a period of ten years, to purchase one share of common stock at the exercise price, which is the closing market price on the date of issuance.grant. Options generally vest ratably in equal annual increments over three years from the award date. Ms. Jacobsmeyer was our only NEO to receive a stock option grant from Encompass in 2022.

2023 Strategy Execution Supplemental LTI Equity Award
Conversion of Encompass Equity Awards at Separation
Prior toFor 2023, the Separation, the Encompass Compensation Committee reviewedapproved a 25% increase to target LTI equity award values for the 2022NEOs (other than Ms. Jacobsmeyer) to reinforce the successful execution of our strategic plan over the next three years. This additional LTI value ofwas allocated the long-term incentivesame as our 2023 annual LTI awards to(60% PSUs and 40% RSUs) and the NEOs. Each Encompass award held by an individual who was an employee of Enhabit following the Separation was converted into an Enhabit equity award. The number of shares subject to each such award were adjusted in a manner intended to preserve the aggregate intrinsic value of the original Encompass award as measured immediately before and immediately after the Separation (in each case, as calculated based on the applicable stock price measurements specified in the Employee Matters Agreement), subject to rounding. Such adjusted award is otherwisePSUs are subject to the same termsperformance conditions as those described above. Further, as noted above, only the portion of these PSUs for which the performance metrics were established in 2023 are reported as granted in 2023 in the “2023 Summary Compensation Table” and conditionsthe “Grants of Plan-Based Awards During 2023” table below. The number of supplemental PSUs and RSUs granted to each NEO are set forth below.
2023 Strategy Execution Supplemental Long-Term Incentive Equity Mix and Awards
Named Executive OfficerPSUs as a
% of the
Award		Awarded PSUsRSUs as a
% of the
Award		Awarded RSUs
Crissy B. Carlisle60%4,90240%3,268
Dylan C. Black60%3,43240%2,288
Julie D. Jolley60%3,82440%2,550
Tanya R. Marion60%2,57440%1,716
Other 2023 NEO Compensation
Enhabit offers a relocation bonus to certain senior officers that appliedare asked to the original Encompass award immediately prior to the Separation. However, Enhabit does not pay dividends and consequently there is no dividend accrual on any awards following conversion.

Conversion of PSUs

Each award of Encompass PSUs held by an individual who was an employee of Enhabit following the Separation was converted into an Enhabit common stock RSU on a 1 to 2.4648197 basis based on a truncated performance period. At the time of Separation the two year performance periodrelocate for the Encompass 2021 and 2022 PSUs had not been completed. Consequently, the Encompass Compensation Committee determined the achievement level as of the time of Separation considering performance prior to the date of Separation.business purposes. The achievement level for the 2020 PSUs had been determined at the time of Separation. The following table reflects the corresponding performance achievement levels for the 2020, 2021 and, 2022 PSU awards. The Outstanding Equity Awards at December 31, 2022 Table includes such awards for our NEOs considering the achievement levels and on as converted basis.
2020 PSU Award2021 PSU Award2022 PSU Award
Performance Period 2020-2021Performance Period 2021-2022Performance Period 2023-2023
PSU MetricAchievementAchievementAchievement
EPS95.2%118.30%95.4%
ROIC81.5%142.7%142.7%91.1%

Conversion of RSAs

Each award of Encompass RSAs held by an individual whoCompany believes it is an employee of Enhabit following the Separation was converted into an Enhabit common stock RSA oneffective recruitment tool for senior officers. Mr. Black received a 1 to 2.4648197 basis. The Outstanding Equity Awards at December 31, 2022 Table includes such awards for our NEOs on a converted basis.

Conversion of Options

Ms. Jacobsmeyer was the only Enhabit employee awarded Encompass options prior to Separation. Following the Separation each option was converted into an Enhabit common stock option on a 1 to 2.4648197 basis. The Outstanding Equity Awards at December 31, 2022 Table includes such awards for Ms. Jacobsmeyer on a converted basis.
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$30,000 relocation bonus in 2023.
Benefits
In 2022, prior to our Separation from Encompass, ourOur NEOs employed by Encompass were eligible for the same benefits offered to other Encompass employees, except that Ms. Jacobsmeyer participated in Encompasses’ nonqualified 401(k) plan, a benefit offered to Encompass senior management. Following our Separation from Encompass, our NEOs wereare eligible for the same benefits offered to all eligible Enhabit employees.

Perquisite Practices
For 2022, we didEnhabit does not have any perquisite plans or policies in place for ourits executive officers. We also diddo not provide tax payment reimbursements, gross ups, or any other tax payments to any of our executive officers. Encompass offered reimbursement of relocation expenses when a senior officer is asked to move for business purposes. Ms. Jacobsmeyer and Ms. Carlisle received this benefit in 2022 from Encompass.

OTHER NEO COMPENSATION
2022 Enhabit Founder Awards
In connection with the separation and distribution, the Company granted founder RSU awards to non-employee directors (as described above under “Director Compensation”) and founder RSAs to certain NEOs, in each case under our 2022 Omnibus Performance Incentive Plan (a description of which is included below). Ms. Jacobsmeyer, Ms. Carlisle, Ms. Jolley, Ms. Marion and Mr. Knight each received a founder award on the date of separation with a grant date value of $3,000,000, $500,000, $390,000, $262,500 and $350,000, respectively. The number of Enhabit RSAs was calculated by dividing the grant date value by the closing trading price of Enhabit common stock on the NYSE on the date of Separation. The founder award granted to Ms. Jacobsmeyer vests in installments, with 50% vesting on the third anniversary of the grant date and 50% vesting on the fourth anniversary of the grant date, subject to continued employment through the applicable vesting date. The founder awards granted to the other NEOs vest in installments, with 25% vesting on the first anniversary of the grant date, 25% vesting on the second anniversary of the grant date, and 50% on the third anniversary of the grant date, in each case, subject to continued employment through the applicable vesting date.

In addition, Ms. Jacobsmeyer received an additional grant on the date of the Separation with a grant date value of $1,087,500 to recognize Ms. Jacobsmeyer’s increased responsibilities as the CEO of a standalone public company. The number of Enhabit RSAs was calculated by dividing the grant date value by the closing trading price of Enhabit common stock on the NYSE on the date of Separation. These RSAs vest in three equal installments on each of February 25, 2023, February 25, 2024 and February 25, 2025, subject to continued employment through the applicable vesting date.

2021 Encompass Home Health and Hospice Retention Bonus Plan
On April 7, 2021, certain of Encompass’s senior officers other than Ms. Jacobsmeyer and Ms. Carlisle were included as participants in the 2021 Encompass Home Health and Hospice Retention Bonus Plan. The purpose of this plan was to retain key members of home health and hospice leadership until the Separation was complete. The plan offered a bonus equal to 50% of their then base salary, with one-half to be paid on the completion of the Separation and one-half to be paid on the 90th day following the Separation. The plan also provided that if the Separation did not occur by March 15, 2022, then each outstanding award awarded pursuant to the plan would immediately vest in full on March 15, 2022. As the separation did not occur prior to March 15, 2022, these awards vested in full on March 15, 2022 and were paid by Encompass in March of 2022. The bonuses for our NEOs under this plan are as follows:

Named Executive Officer2021 Home Health and Hospice Retention Bonus Plan Value
Barbara A. JacobsmeyerN/A
Crissy B. CarlisleN/A
Julie Jolley$152,495
Jeanne Kalvaitis(1)
N/A
Tanya Marion(1)
N/A
Chad K. Knight$127,504
(1) Ms. Kalvaitis and Ms. Marion were not hired until 2022 and therefore did not receive a 2021 retention bonus.
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Knight Separation and Release Agreement
In September 2022, Mr. Knight and the Company entered into a Separation and Release Agreement effective as of November 4, 2022 at which time Mr. Knight resigned from his position as General Counsel. Pursuant to this agreement, Mr. Knight (i) will receive his base salary for 15 months following his resignation (approximately $437,500) and the Company’s payment of the employer portion of his health and welfare benefit premiums for a period of up to 15 months (approximately $25,144) and (ii) agrees to release the Company from any and all claims to the fullest extent permissible by law (as described in the agreement). Mr. Knight also received a pro-rated bonus under the Enhabit senior management bonus plan for 2022. This amount ($79,448) was paid in March 2023. Mr. Knight will remain subject to the terms of his restrictive covenants agreement, including nonsolicitation and noncompete provisions for 12 months after his resignation.

OTHER COMPENSATION POLICIESOther Compensation Policies & PRACTICES

Practices
Equity Ownership Guidelines for Management and Non-Employee Directors
To further align the interests of our management and non-employee directors with those of our stockholders, we have adopted equity ownership guidelines for seniorexecutive management and members of our Board.

Executive officers and non-employee directors have five years to reach their ownership level. As a new public company, each of our NEOs and non-employee directors currently satisfies the equity ownership guidelines or is within the five-year grace period. We expect
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that each of our NEOs and non-employee directors who do not currently satisfy the guidelines will satisfy them prior to the expiration of the five-year grace period. Outlined in the table below are the ownership guidelines:
PositionRequired Value of Equity Owned 
Chief Executive Officer5 times annual base salary
Executive Management (including NEOS other than CEO)3 times annual base salary
Non-Employee Directors$375,000
Compensation Recoupment Policy
OurEffective December 1, 2023, in accordance with SEC and NYSE requirements, the Company adopted a new Incentive Compensation Recoupment Policy (the “Clawback Policy”), which provides for the reasonably prompt recovery (or clawback) of certain excess incentive-based compensation received during an applicable three-year recovery period by current or former executive officers in the event the Company is required to prepare an accounting restatement due to the material noncompliance with any financial reporting requirement under the securities laws. Excess incentive-based compensation for these purposes generally means the amount of incentive-based compensation received (on or after October 2, 2023) by such executive officer that exceeds the amount of incentive-based compensation that would have been received by such executive officer had it been determined based on the restated amounts, without regard to any taxes paid. Incentive-based compensation potentially subject to recovery under the Clawback Policy is generally limited to any compensation granted, earned or vested based wholly or in part on the attainment of one or more financial reporting measures.
The Clawback Policy does not condition such clawback on the fault of the executive officer, but the Company is not required to recoup amounts in limited circumstances set forth in the Clawback Policy where the Compensation Committee has made a determination that recovery would be impracticable. Operation of the Clawback Policy is subject to a brief phase-in process during the first few years after its effectiveness. The Company may not indemnify any such executive officer against the loss of such recovered compensation in the event of a mandatory accounting restatement.
In addition to the Clawback policy, our Board has approved and adopted a senior management compensation recoupment policy.policy (the “Supplemental Clawback Policy”). The policySupplemental Clawback Policy provides that if the Board has determined, in its sole discretion, determined that any fraud, illegal conduct, intentional misconduct, or gross neglect by any officer was a significant contributing factor to our having to restate all or a portion of our financial statements, the Board may:

•require reimbursement of any incentive compensation paid to that officer,
•cause the cancellation of that officer’s restricted or deferred stock awards and outstanding stock options, and
•require reimbursement of any gains realized on the exercise of stock options attributable to incentive awards, if and to the extent (i) the amount of that compensation was calculated based upon the achievement of the financial results that were subsequently reduced due to that restatement and (ii) the amount of the compensation that would have been awarded to that officer had the financial results been properly reported would have been lower than the amount actually awarded.
Additionally, under the Supplemental Clawback Policy, if an officer is found to have committed fraud or engaged in intentional misconduct in the performance of his or her duties, as determined by a final, non-appealable judgment of a court of competent jurisdiction, and the Board determines the action caused substantial harm to the Company, the Board may, in its sole discretion, utilize the remedies described above.

Anti-Hedging and Pledging
The Company’s Insider Trading Policy prohibits the following transactions and positions for all employees, officers and directors, and their immediate family members:

•short sales of our securities;securities
•hedging or monetization transactions, such as zero-cost collars, equity swaps, exchange funds and forward sale contracts or similar arrangements with respect to Enhabit stock, including the purchase or sale of puts or calls or the use of any other derivative instruments; andinstruments
25

•holding Enhabit stock in a margin account or pledging Enhabit stock as collateral for a loan.loan
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Severance Arrangements
To provide senior executives with additional certainty about their employment and as a retention tool for the Company, potential benefits wereare provided by Encompass to its seniorour executives under its change of controlour Executive Severance Plan and our Executive Change in Control Benefits Plan. In February 2023, the Compensation Committee adopted amendments to the Executive Severance Plan and the Executive Change in Control Benefits Plan that reduced the cash severance plans.and health and welfare benefits payable thereunder, among other changes, to better align such benefits with peers’ severance benefits. The Encompass Compensation Committee determined that the value of benefits wereunder these plans are reasonable, appropriate, and competitive with those of Encompass’sEnhabit’s healthcare provider peer group. As a condition to receipt of any payment or benefits under either plan, participating employees must enter into a noncompetition,restrictive covenant (noncompetition, nonsolicitation, nondisclosure, nondisparagementand nondisparagement) and release agreement. The duration of the restrictive covenants would be equal to the benefit continuation periods described below for each plan. As a matter of policy, payments under either plan do not include “gross ups” for taxes payable on amounts paid.paid thereunder. Definitions of “cause,” “retirement,” “change in control,” and “good reason” are provided on page here32.

The participants’ payout multipliers and benefit plan continuation periods under both plans are detailed in the table below.
Named Executive OfficerSeverance MultiplierBenefit Plan  
Continuation Period
Barbara A. Jacobsmeyer2.5x18 months
Crissy B. Carlisle
Dylan C. Black
Julie D. Jolley
Tanya R. Marion		1.75x12 months
Executive Severance Plan
Effective upon the Separation, the Company adopted an Executive Severance Plan toTo help retain qualified senior officersexecutives whose employment is subject to termination under circumstances beyond their control. Eachcontrol, each of our NEOs became participantsis a participant in the plan.The Enhabit Executive Severance Plan was based upon, and substantially similar to, the terms and conditions of the Encompassour Executive Severance Plan. The terms of the plan, including the payment triggering events, were determined by the Encompass Compensation Committee to be consistent with healthcare industry market data. Only Ms. Jacobsmeyer and Ms. Carlisle participated in the Encompass Executive Severance Plan prior to the Separation.

In February 2023, the Enhabit Compensation Committee adopted amendments to the Executive Severance Plan that reduced the cash severance and health and welfare benefits to better align the benefit with peers’ severance benefits. The description below describes the Enhabit Executive Severance Plan in effect on December 31, 2022. Certain changes to the plan adopted in February 2023 are described below under “Executive Compensation Program Details and Changes for 2023.”

Under the plan, if a participant’s employment is terminated by the participant for good reason or by the Company other than for cause (as defined in the plan), then the participant is entitled to receive a cash severance payment, health benefits, and the other benefits as described below. Voluntary retirement, death,below, subject to the participant’s execution of an effective restrictive covenant and disability are not payment triggering events.

release agreement.
The cash severance payment is the annual base salary in effect at the time of termination multiplied by the eventapplicable multiplier from the table above, plus any accrued but unused, paid time off, and accrued, but unpaid, salary multiplied by a cash severance multiplier.obligations. This amount is to be paid in a lump sum within 60 days following the participant’s termination date. In addition, except in the event of termination for cause or resignation for lack ofwithout good reason, the participant (and his or her dependents) would continue to be covered by all Enhabit life, healthcare, medical, dental and dentalvision insurance plans and programs, excluding disability, for the periods noted below.

Named Executive OfficerSeverance as Multiple of
Annual Base Salary		Benefit Plan  
Continuation Period
Barbara A. Jacobsmeyer2.99x36 months
Crissy B. Carlisle
Julie D. Jolley
Chad K. Knight		2.00x24 months
Jeanne Kalvaitis
Tanya Marion		1.00x12 months
applicable period from the table above at the same cost sharing between the Company and the participant as a similarly situated active employee.
Amounts paid under the plan are in lieu of, and not in addition to, any other severance or termination payments under any other plan or agreement with Encompass or the Company.Enhabit. As a condition to receipt of any payment under the plan, the participant must waive any entitlement to any other severance or termination payment.

Upon terminationGenerally, in the event of a participantparticipant’s termination without cause, or his or her resignation for good reason, a prorated portion of any then-unvested equity award that is subject only to time-based vesting only that is unvested as of the effective date of the termination or resignation will automatically vest. If any restricted stock awards arethen-unvested equity award is performance-based, the Committee will determineparticipant would be entitled to a prorated portion of the extent to whichaward that would vest based on actual achievement of the performance goalsobjectives for the full performance period, as determined after the conclusion of such restricted stock have been met and what awards have been earned.performance period by the Compensation Committee.

Executive Change in Control Benefits Plan
Effective upon the Separation, the Company adopted a Change in Control Benefits Plan toTo help retain certain qualified senior officers,executives, maintain a stable work environment, and encourage officers to act in the best interest of stockholders if presented with decisions regarding change in control transactions. Eachtransactions, each of our NEOs became participantsis a participant in the plan. The
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Enhabitour Executive Change in Control Benefits Plan was based upon, and substantially similar to, the terms and conditions of the Encompass Change in Control Benefits Plan. The terms of the plan, including the definition of a change in control event, were reviewed and determined to be consistent with healthcare industry market data. Only Ms. Jacobsmeyer and Ms. Carlisle participated in the Encompass Change in Control Benefits Plan prior to the Separation.

In February 2023, the Enhabit Compensation Committee adopted amendments to the Change in Control Benefits Plan that reduced the cash severance and health and welfare benefits to better align the benefit with peers’ severance benefits. The description below describes the Enhabit Change in Control Benefits Plan in effect on December 31, 2022. Certain changes to plan adopted in February 2023 are described below under “Executive Compensation Program Details and Changes for 2023.”

Under the Change in Control Benefits Plan, participants are divided into tiers as designated by the Enhabit Compensation Committee. Ms. Jacobsmeyer is a Tier 1 participant, and each of the other NEOs is a Tier 2 participant.

If a participant’s employment with the Company is terminated during the pre-change in control period or within 24 months following a change in control or during a potential change in control, either by the participant for good reason (as defined in the plan) or by the Company without cause, then the participant shall receive the payments and benefits described below, subject to the participant’s execution of an effective restrictive covenant and release agreement. Under this plan, participants are entitled to receive a lump sum severance payment. Voluntary retirement is not a payment triggering event. For Tier 1 and 2 participants, the lump sum severance is 2.99 times and 2.0 times, respectively,equal to (i) the sum
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of the participant’s highest annual base salary in the priorpreceding three years andplus the average of actual annual incentives for the prior three years for(excluding years where the participant,executive was not eligible, and using the target amount if the executive was not eligible in any of the preceding three years), multiplied by the applicable multiplier from the table above, plus (ii) a prorated annual incentive award for any incomplete performance period. period (and, in the case of a termination after the completion of the performance period but before payment of the earned award, an amount for such completed period based on actual performance), plus (iii) any accrued obligations.In addition, except in the event of termination for cause or resignation for lack ofwithout good reason, the participant and the participant’s dependents continue to be covered by all Enhabit life, healthcare, medical, dental and dentalvision insurance plans and programs, excluding disability, for the applicable period from the table above at the same cost sharing between the Company and the participant as a period of 36 months for Tier 1 participants and 24 months for Tier 2 participants.

similarly situated active employee.
If a change in control of Enhabit occurs as(as defined in the plan,plan) of Enhabit were to occur, outstanding Enhabit equity awards would vest as follows: If (A) a replacement award is not provided with respect to such outstanding award, or (B) a replacement award is provided with respect to such outstanding award, but the participant resigns for good reason or is terminated without cause within 24 months following such change in control, then the outstanding awards would vest. Options or stock appreciation rights that vest under (B) would remain exercisable until the earlier of two years following the termination or the original expiration date. With respect to outstanding performance-based awards, an award would not be considered a replacement award in respect thereof unless it is converted into a time-based award, with the number of units subject to such replacement award based on (x) the greater of the target value or actual performance at the time of the change in control, if such change in control occurred on or before the last day of the performance period, or (y) actual performance, if such change in control occurred after the end of the performance period.
Stock OptionsRestricted Stock
Outstanding options to purchase common stock will only vest if the participant is terminated for good reason or without cause within 24 months of a change in control of Enhabit or if not assumed or substituted and all options will remain exercisable for three years.Restricted stock will only vest if the participant is terminated for good reason or without cause within 24 months of a change in control of Enhabit or if not assumed or substituted.
Note: For performance-based restricted stock, the Committee will determine the extent to which the performance goals have been met and vesting of the resulting restricted stock will only accelerate as provided above.
The Compensation and Human Capital Committee has the authority to cancelsettle an award in exchange for a cash paymentor cash equivalents in an amount equal to the excess of the fair market value of the same number of shares of common stock subject tounderlying the award immediately prior to(as of a specified date associated with the change in control of Enhabittransaction) over the aggregateexercise or base price (if any) of the award.The Compensation Committee may also cancel an award if the fair market value of the shares of common stock does not exceed the exercise or base price (if any) of the award.
Tax Implications ofNotable Executive Compensation
Section 162(m) of the Internal Revenue Code of 1986, as amended (“Section 162(m)”), generally limits to $1 million per year income tax deductions available to publicly held corporations for compensation paid Program Decisions in years beginning after December 31, 2017 to the corporation’s CEO, CFO, certain other NEOs, and certain former NEOs (each a “Covered Executive”). As a result, most compensation in excess of $1 million paid to our Covered Executives is not deductible.2024

Base Salary:
The Committee considers the effect of Section 162(m) on the Company’s executive compensation program. The Compensation Committee exercises discretion in settingWe have not increased base salaries structuring incentive compensation awards andfor executive officers in determining payments in relation to levels of achievement of performance goals. The Compensation Committee believes that the total compensation program for Covered Executives should be managed in accordance with the objectives outlined in the Company’s compensation philosophy and in the best overall interests of the Company’s stockholders. Accordingly, compensation paid by the Company may not be deductible because such compensation exceeds the limitations for deductibility under Section 162(m).
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EXECUTIVE COMPENSATION PROGRAM DETAILS AND CHANGES IN 2023

2024.
Annual Incentive - SMBP. Recognizing the importance of improved financial performance for the Company in 2024, the Compensation Committee made the following adjustments to the 2024 SMBP to better align pay with our 2024 financial goals:
•We maintained use of Adjusted EBITDA as a financial metric and the same Quality Scorecard sub-metrics but revised metrics underthe weighting from 70% Adjusted EBITDA / 30% Quality Scorecard to 80% / 20%, respectively.
•We added a maximum payout qualifier to the Quality Scorecard metric: target Adjusted EBITDA must be achieved in order to align with our 2023 performance objectives.get a 200% payout, otherwise maximum is lowered to 150%.
Long-Term Performance Awards. The Enhabit Compensation Committee and senior management focused on choosing metrics that closely aligned to the long-term strength of the business and stockholder interests. After consultation with various shareholders and input from our compensation consultant we selected Adjusted Free Cash Flow per Share and Relative Total Shareholder Return as performance metrics of our performance-based equity grants.
Executive Severance Plans. In February 2023, the Enhabit Compensation Committee adopted amendments to the Executive Severance Plan and Change in Control Benefits Plan.
The amended Executive Severance Plan includes the following changes from the original Executive Severance Plan:

Compensation Committee Report
•
reduces
The Compensation & Human Capital Committee reviewed and discussed with management the cash severance amount payable to a participant on a terminationCompensation Discussion and Analysis required by Item 402(b) of employment without Cause or for Good Reason (a “Qualifying Termination”) (a) from 2.99 times base salary to 2.5 times base salary for “Tier 1 Participants” (currently, Ms. Jacobsmeyer)Regulation S-K, and, (b) from two times base salary to 1.75 times base salary for “Tier 2 Participants” (which includes our other NEOs);
•reducesbased upon such review and discussions, the period during which continued medical, dentalCompensation and vision coverage will be provided following a Qualifying Termination (a) from 36 months to 18 months for Tier 1 Participants and (b) from 24 months to 12 months for Tier 2 Participants;
•makes the definition of “Cause” more Company-protective by including certain misdemeanors and certain willful or gross misconduct as “Cause” triggers; and
•with respectHuman Capital Committee recommended to the pro-rata vesting of equity awards upon a qualifying termination, changesBoard that the treatment of performance-based awards so that they willCompensation Discussion and Analysis be earned basedincluded in this Amendment to the Company’s Annual Report on actual achievementForm 10-K for the full performance period, rather than based on a discretionary determination by the Committee.
The amended Change in Control Benefits Plan includes the following changes from the original Change in Control Plan:
•reduces the cash severance amount payable on a qualifying termination during the pre-change in control period or within two years after a change in control (a) for Tier 1 participants (currently, Ms. Jacobsmeyer), from 2.99 times base salary plus average bonus to 2.5 times base salary plus average bonus,year ended December 31, 2023, and (b) for Tier 2 participants (including our other NEOs), from two times base salary plus average bonus to 1.75 times base salary plus average bonus;
•changes the period in which continued medical, dental and vision coverage will be provided following a qualifying termination during the pre-change in control period or within two years after a change in control (a) from 36 months to 18 months for Tier 1 participants, and (b) from 24 months to 12 months for Tier 2 participants;
•makes the definition of “Cause” more Company-protective by including certain misdemeanors and certain willful or gross misconduct as “Cause” triggers; and
•continues to provide that performance-based equity awards will be converted into time-based awards in the eventCompany’s proxy statement for its 2024 annual meeting of a change in control, but such conversion will be based on the value of the award at the time of the change in control.stockholders.
Compensation and Human Capital Committee
Yvonne M. Curl (Chairperson)
Equity Award Timing. Encompass’s practice was to have the independent members on its board of directors approve, based on recommendations of the Encompass Compensation Committee, equity awards at the February board of directors’ meeting which allows time to review and consider its prior year’s performance. We have currently adopted the same process.Erin P. Hoeflinger
Susan A. La Monica
L. Edward Shaw, Jr.
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Executive Compensation Tables
The tables below shows the compensation of our NEOs. The information set forth below with respect to the period prior to the Separation and years ended December 31, 2021 and 2020 is historical Encompass compensation. The historical Encompass compensation, which was approved by Encompass, has been provided by, or derived from information provided by, Encompass and reflects certain compensation earned during 2022from periods prior to the Separation and for the years ended December 31, 2021 and 2020 based upon services performed during such periods. The Company provided the compensation information for periods following the Separation, most of which was attributable to the Encompass program assumed by the Company as a result of the Separation.

Summary Compensation Table

The table below sets forth the compensation earned by or paid toof our NEOs duringfor the fiscal years ended December 31, 2023, 2022, and 2021, and 2020.as applicable.
Name and Principal            
Position            		YearSalary
($)		Bonus
($)
Stock Awards
($)(1)
Option Awards
($)(2)
Non-Equity Incentive Plan Compensation
($)(3)
All Other
Compensation
($)(4)
Total
($)
Barbara A. Jacobsmeyer2022873,462 — 5,668,103 382,718 344,505 37,643 7,306,431 
President and Chief Executive Officer2021703,846 — 1,303,548 319,295 871,386 143,320 3,341,395 
2020620,000 — 1,211,485 266,742 497,250 26,963 2,622,440 
Crissy B. Carlisle2022437,970 — 1,026,906 — 108,080 65,614 1,638,570 
Executive Vice President and Chief Financial Officer2021319,849 — 173,834 — 318,939 40,410 853,032 
Julie Jolley2022382,491 152,495 811,574 — 105,378 2,288 1,454,226 
Executive Vice President,
Home Health Operations		2021318,893 — 353,385 — 225,019 2,822 900,119 
Jeanne Kalvaitis2022150,202 — — — 29,811 1,127 181,140 
Executive Vice President, Hospice Operations
Tanya Marion2022323,078 30,000 499,726 — 67,550 2,288 922,642 
Chief Human Resources Officer
Chad K. Knight(5)
2022280,391 127,504 671,461 — 79,488 462,644 1,621,488 
General Counsel and Secretary2021256,345 — 97,421 — 183,031 2,288 539,085 
Name and Principal
Position		YearSalary
($)		Bonus
($)		Stock Awards
($)(1)(2)		Option Awards
($)(3)		Non-Equity Incentive Plan Compensation
($)(4)		All Other
Compensation
($)(5)		Total
($)
Barbara A. Jacobsmeyer2023850,000 — 1,488,520 535,344 468,563 2,475 3,344,902 
President and Chief Executive Officer2022873,462 — 5,668,103 382,718 344,505 37,643 7,306,431 
2021703,846 — 1,303,548 319,295 871,386 143,320 3,341,395 
Crissy B. Carlisle2023400,001 — 472,480 — 147,000 2,475 1,021,956 
Chief Financial Officer2022437,970 — 1,026,906 — 108,080 65,614 1,638,570 
2021319,849 — 173,834 — 318,939 40,410 853,032 
   Dylan C. Black2023329,809 30,000 330,771 — 128,626 — 819,205 
     General Counsel and Secretary
Julie D. Jolley2023390,000 — 368,567 — 143,325 2,475 904,367 
Executive Vice President, Home Health2022382,491 152,495 811,574 — 105,378 2,288 1,454,226 
2021318,893 — 353,385 — 225,019 2,822 900,119 
Tanya R. Marion2023350,002 — 248,082 — 91,875 2,475 692,434 
Chief Human Resources Officer2022323,078 30,000 499,726 — 67,550 2,288 922,642 
(1)TheRepresents time-based restricted stock awards for each year consist ofunits, or “RSUs,” and performance-based restricted stock units, or “PSUs,” and time-based restricted stock, or “RSAs,” as part ofgranted in 2023. Amounts are not an actual dollar amount received by our NEOs in fiscal year 2023, but instead represent the long-term incentive plan for the given year. The amounts shown in this column are theaggregate grant date fair valuesvalue of the awards granted to each NEO computed in accordance with Accounting Standards Codification Topic 718, Compensation - Stock Compensation (“ASC 718”), assuming the most probable outcome of the performance conditions as of the grant dates (i.e., target performance). With respect to PSUs, the grant date fair value, assuming maximum achievement of the applicable performance objectives, is as set forth in the “Maximum” column of the table set forth in footnote 2 below. All of the values in this column are consistent with the estimate of aggregate compensation expense to be recognized over the applicable vesting period, excluding any adjustment for forfeitures. The assumptions used in the valuations are discussed in Note 10,9, Stock-Based Payments, to the consolidated financial statements in our 20222023 Form 10-K.
(2)The table and additional information below set forth the details of the stock awards to our NEOs in fiscal year 2023. All values in the table below are grant date values computed in accordance with ASC 718.
a.RSUs vest in three substantially equal annual installments beginning on the first anniversary of the date of grant.
b.For the PSU awards, the number of shares earned will be determined at the varyingend of a three-year performance levelsperiod based on the level of achievement of adjusted free cash flow per share (“FCFPS”) and relative total shareholder return (“rTSR”), weighted 80% and 20% respectively. The FCFPS metric is measured as an average of three, one-year performance periods: 2023, 2024, and 2025. The Compensation Committee will set the annual FCFPS goal for our current NEOs are set fortheach year of the performance period at the start of such year. rTSR is measured over the full three-year performance period. Consistent with the requirements of ASC 718, the value of the PSUs displayed in the table below.below, at their minimum, target, and maximum levels, is based on one-third of the full number of shares for which the FCFPS goal was established in fiscal year 2023 and all of the shares for which the rTSR goal was establish in fiscal year 2023. The remaining portions of the 2023 FCFPS PSU award will be linked to FCFPS goals for subsequent fiscal years and will be reported in the Summary Compensation Table for those fiscal years.
Name                    YearThreshold
Performance
Value ($)		Target
Performance
Value ($)		Maximum
Performance
Value ($)
Barbara A. Jacobsmeyer2022592,704 1,185,407 2,370,814 
2021488,810 977,620 1,955,240 
2020454,287 908,573 1,817,146 
Crissy B. Carlisle2022158,077 316,153 632,306 
202152,158 104,317 208,634 
Julie Jolley2022126,482 252,963 505,926 
202146,010 92,001 184,001 
Jeanne Kalvaitis2022— — — 
Tanya Marion202271,165 142,329 284,658 
Chad K. Knight202296,428 192,855 385,710 
202134,097 68,195 136,389 
Components of 2023 Stock Awards
Restricted Stock UnitsPerformance-Based Restricted Stock Units
Name($)Threshold
($)		Target
($)		Maximum
($)
Barbara A. Jacobsmeyer535,515476,503 953,005 1,906,010 
Crissy B. Carlisle250,002111,239 222,478 444,955 
Dylan C. Black175,01777,877 155,754 311,508 
Julie D. Jolley195,02986,769 173,538 347,076 
Tanya R. Marion131,25958,412 116,823 233,647 

(2)(3)The values of option awards listed in this column are the grant date fair values computed in accordance with ASC 718 as of the grant date.718. All of the values in this column are consistent with the estimate of aggregate compensation expense to be recognized over the three-year vesting period, excluding any
26

adjustment for forfeitures. The assumptions used in the valuations are discussed in Note 10,9, Stock-Based Payments, to the consolidated financial statements in our 20222023 Form 10-K.
29

(3)(4)TheRepresents amounts shown in this column are bonuses earned under the senior management bonus plan in the corresponding year but paid in the first quarter of the following year.
(4)(5)The items reported in this column for 20222023 are described as set forth below. Thefor the Company’s matching contribution to the Company’s 401(k) plan.
For an explanation of the amount includedof salary and annual incentive compensation in proportion to the total compensation of the NEOs, see the section entitled “NEO Target Total Direct Compensation for 2023” in the “Other” column below is for relocation taxes paid by Encompass for Ms. JacobsmeyerCompensation Discussion and Carlisle in 2022 and estimated total payments to Mr. Knight pursuant to the terms of the Separation and Release Agreement between Mr. Knight and the Company.
NameQualified  401(k)
Match ($)		Nonqualified
401(k)
Match ($)		Other ($)
Barbara A. Jacobsmeyer7,942 21,661 8,040 
Crissy B. Carlisle5,885 462 59,267 
Julie Jolley2,287 — — 
Jeanne Kalvaitis1,127 — — 
Tanya Marion2,287 — — 
Chad K. Knight— — 462,644 
Analysis.

(5)    In September 2022, Mr. Knight and the Company entered into a Separation and Release Agreement effective as of November 4, 2022 at which time Mr. Knight resigned from his position as General Counsel. Pursuant to this agreement, Mr. Knight (i) will receive his base salary for 15 months following his resignation (approximately $437,500) and the Company’s payment of the employer portion of his health and welfare benefit premiums for a period of up to 15 months (approximately $25,144) and (ii) agrees to release the Company from any and all claims to the fullest extent permissible by law (as described in the agreement). Mr. Knight also received a pro-rated bonus under the Enhabit senior management bonus plan for 2022. This amount ($79,448) was paid in March 2023 and is reflected above under “Non-Equity Incentive Plan Compensation.” Mr. Knight will remain subject to the terms of his restrictive covenants agreement, including nonsolicitation and noncompete provisions for 12 months after his resignation.
3027


Grants of Plan-Based Awards During 20222023
The following table sets forth grants of plan-based awards to the NEOs during the fiscal year that ended December 31, 2022, including equity and non-equity awards granted to our NEOs by Encompass prior to the Separation. Equity awards originally granted by Encompass in February and March of 2022 under Encompass’s equity compensation plan were converted to Enhabit awards under the 2022 Omnibus Performance Incentive Plan in connection with the Separation with vesting dates consistent with the original awards from Encompass and are presented on an as-converted basis. The Founder’s RSA were granted by Enhabit under the 2022 Omnibus Performance Incentive Plan at the time of the Separation in July 2022.2023.
 All Other Stock
Awards: Number of 
Shares of Stock or Unit
(#)		All Other
Option Awards: Number of 
Securities Underlying 
Options
(#)		Exercise or
Base Price of Option Awards
($/SH) 		Grant Date
Fair Value of Stock and Option 
Awards
($)
 Date of 
Board Approval of
Grant
Estimated Possible Payouts Under
Non-Equity Incentive Plan Awards(1)
Estimated Future Payouts Under  Equity Incentive Plan Awards(2)
All Other Stock
Awards: Number of
Shares of Stock or Units
(#)		All Other Stock
Awards: Number of
Shares of Stock or Units
(#)		All Other
Option Awards: Number of 
Securities Underlying 
Options
(#)		Exercise or
Base Price of Option Awards
($/SH) 		Grant Date
Fair Value of Stock and Option 
Awards(3)
($)
Date of
Board Approval of
Grant
Name
Name
NameNameGrant  DateDate of 
Board Approval of
Grant
Threshold
($)
Target
($)
Maximum
($)
Threshold
(#)		Target
(#)		Maximum
(#)		All Other Stock
Awards: Number of 
Shares of Stock or Unit
(#)		All Other
Option Awards: Number of 
Securities Underlying 
Options
(#)		Exercise or
Base Price of Option Awards
($/SH) 		Grant Date
Fair Value of Stock and Option 
Awards
($)
Barbara A. JacobsmeyerBarbara A. Jacobsmeyer
Barbara A. Jacobsmeyer
Barbara A. Jacobsmeyer
Annual Incentive
Annual Incentive
Annual IncentiveAnnual Incentive446,250 892,500 1,785,000 — — — — — — — 
PSUPSU2/25/2022— — — 21,802 43,603 87,208 — — — 1,185,407 
RSU
Stock optionsStock options3/1/20222/25/2022— — — — — — — 54,562 26.94 382,718 
RSA2/25/2022— — — — — — 14,535 — — 395,158 
Founder’s RSA7/1/20226/15/2022— — — — — — 47,824 — — 1,087,518 
Founder’s RSA7/1/20226/15/2022— — — — — — 131,927 — — 3,000,020 
Crissy B. CarlisleCrissy B. Carlisle
Annual IncentiveAnnual Incentive140,001 280,001 560,002 — — — — — — — 
PSU2/25/2022— — — 5,815 11,629 23,258 — — — 316,153 
RSA2/25/2022— — — — — — 7,754 — — 210,746 
Founder’s RSA7/1/20226/15/2022— — — — — — 21,988 — — 500,007 
Julie Jolley
Annual Incentive
Annual IncentiveAnnual Incentive136,500 273,000 546,000 — — — — — — — 
PSUPSU2/25/2022— — — 4,652 9,305 18,609 — — — 252,963 
RSA2/25/2022— — — — — — 6,202 — — 168,597 
Founder’s RSA7/1/20226/15/2022— — — — — — 17,151 — — 390,014 
Jeanne Kalvaitis
RSU
Dylan C. Black
Annual IncentiveAnnual Incentive40,107 80,214 160,427 — — — — — — — 
Tanya Marion
Annual Incentive
Annual IncentiveAnnual Incentive87,501 175,001 35,002 — — — — — — — 
PSUPSU2/25/2022— — — 2,618 5,235 10,471 — — — 142,329 
RSA2/25/2022— — — — — — 3,490 — — 94,886 
Founder’s RSA7/1/20226/15/2022— — — — — — 11,544 — — 262,511 
Chad K. Knight
RSU
Julie D. Jolley
Annual Incentive
Annual Incentive
Annual IncentiveAnnual Incentive122,500 245,000 490,000 — — — — — — — 
PSUPSU2/25/2022— — — 3,547 7,094 14,188 — — — 192,855 
RSA2/25/2022— — — — — — 4,732 — — 128,592 
Founder’s RSA7/1/20226/15/2022— — — — — — 15,392 — — 350,014 
RSU
Tanya R. Marion
Annual Incentive
Annual Incentive
Annual Incentive
PSU
RSU
 
Footnotes found on next page.
31


(1)TheRepresents the range of possible payments described in these three columns are cash amounts provided for byawards under the senior management bonus plan (the “SMBP”) as discussed under “Annual Incentives” beginning on page here18. Awards are dependent on results measured against pre-established performance goals. There is a threshold level of performance and the amounts shown in the “maximum” column are 200% of the target amount, which is the maximum possible award payout. Final payments under the senior management bonus planSMBP were calculated and paid in the first quarter of 20232024 by Enhabitthe Company and are reflected in the Summary Compensation Table under the heading “Non-Equity Incentive Plan Compensation.”
(2)ReflectsRepresents the PSUrange of possible awards of performance-based restricted stock units, or “PSUs” granted in 2023 under the 2022 Omnibus Performance Incentive Plan (the “Omnibus Plan”). The amounts shown in the “threshold” column are 50% of the target amount, and represents meeting threshold performance for the FCFPS and rTSR performance goals contained in the PSU. Awards could be as low as zero. The amounts shown in the “maximum” column are 200% of the target amount, which is the maximum possible award payout. The PSUs are described in footnote 2 of the Summary Compensation Table. ASC 718 requires the Company to account for only the portion of the award that is linked to FCFPS for which the applicable goal was established in 2023, as well the entire portion of the award that is linked to the rTSR for which the performance goals for the full three-year period were established in 2023. The remaining portions of the award are linked to FCFPS goals that will be established in subsequent fiscal years and will be reported in the Grant of Plan-Based Awards table for those fiscal years.
(3)Amounts are not an actual dollar amount received by our NEOs by Encompass. The PSUs were converted to Enhabit RSUs in connectionfiscal year 2023, but instead represent the aggregate grant date fair value of the equity awards calculated in accordance with the Separation.ASC 718.


3228

Outstanding Equity Awards at December 31, 2022(1)2023
 
Option Awards(2)
Stock Awards
Number of
Securities
Underlying
Unexercised
Options (#)		Number of Securities
Underlying
Unexercised
Options (#)		Option
Exercise Price ($)
Option
Expiration Date(3)
Number of
Shares or
Units of
Stock That
Have Not Vested  (#)(4)
Market
Value of
Shares or
Units of
Stock That
Have Not Vested   ($)(5)
Equity  Incentive
Plan Awards:
Number of
Unearned  Shares, Units  or Other Rights That Have Not Vested (#)		Equity  Incentive
Plan Awards:
Market or 
Payout Value of Unearned Shares, Units  or Other Rights  That Have Not Vested ($)
NameExercisableUnexercisable
Barbara A. Jacobsmeyer
19,204 — 17.13 2/25/2027— — — — 
29,948 — 21.83 3/1/2028— — — — 
35,091 — 25.88 3/1/2029— — — — 
28,307 14,152 31.06 3/2/2030— — — — 
13,655 27,310 32.62 3/2/2031— — — — 
54,562 26.94 3/1/2032— — — — 
306,304 4,030,961 — — 
Crissy B. Carlisle
— — — — 49,127 646,511 — — 
Julie Jolley
— — — — 46,380 610,361 — — 
Jeanne Kalvaitis
— — — — — — — — 
Tanya Marion
— — — — 19,942 262,437 — — 
Chad K. Knight
— — — — — — — — 
(1)Equity awards originally granted by Encompass under Encompass’s equity compensation plan were converted to Enhabit awards under the Enhabit 2022 Omnibus Performance Incentive Plan in connection with the Separation with vesting dates consistent with the original awards from Encompass and are presented on an as-converted basis.
(2)All options shown above vest in three equal annual installments beginning on the first anniversary of the grant date.
(3)The expiration date of each option occurs 10 years after the grant date of each option.
(4)The amount shown in this column are RSUs resulting from the attainment of the Encompass PSU awards and converted pursuant to footnote (1) above, RSAs converted pursuant to footnote (1) above, and RSAs granted by Enhabit in 2022. Vesting dates are detailed below.
(5)The market value reported was calculated by multiplying the closing price of our common stock on the last trading day of 2022, $13.16, by the number of shares set forth in the preceding column.
Option Awards(1)
Stock Awards
Number of
Securities
Underlying
Unexercised
Options (#)		Number of Securities
Underlying
Unexercised
Options (#)		Option
Exercise Price ($)		Option
Expiration Date
Number of
Shares or
Units of
Stock That
Have Not Vested (#)(2)
Market
Value of
Shares or
Units of
Stock That
Have Not Vested ($)(3)
Equity  Incentive
Plan Awards:
Number of
Unearned  Shares, Units  or Other Rights That Have Not Vested (#)(4)
Equity  Incentive
Plan Awards:
Market or 
Payout Value of Unearned Shares, Units  or Other Rights  That Have Not Vested ($)(3)
NameExercisableUnexercisable
Barbara A. Jacobsmeyer
19,204 — 17.13 2/24/2027— — — — 
29,948 — 21.83 3/1/2028— — — — 
35,091 — 25.88 3/1/2029— — — — 
42,459 — 31.06 3/2/2030— — — — 
27,310 13,655 32.62 3/2/2031— — — — 
18,185 36,377 26.94 3/1/2032— — — — 
— 64,113 15.30 3/1/2033— — — — 
— — — — 289,925 3,000,724 105,001 1,086,760 
Crissy B. Carlisle
— — — — 53,573 554,481 24,510 253,679 
Dylan C. Black
— — — — 11,439 118,394 17,158 177,585 
Julie D. Jolley
— — — — 42,589 440,796 19,119 197,882 
Tanya R. Marion
— — — — 24,474 253,306 12,869 133,194 
(1) Options vest in three equal annual installments beginning on the first anniversary of the grant date and the expiration date of each option occurs 10 years after the grant date.
(2) The amounts shown represent unvested RSAs and RSUs. Individual vesting dates are detailed below.
(3) The market value reported was calculated by multiplying the closing price of our common stock on the last trading day of 2023, $10.35, by the number of shares set forth in the preceding column.
(4) The amounts shown represent outstanding PSUs held by the NEOS. These PSUs vest March 1, 2026, following a three-year performance period from 2023-2024 and are represented at target performance.

RSA Vestings after 12/31/2023RSA Vestings after 12/31/2023
NameNameRSA Vestings after 12/31/2022Name2/24/20242/25/20247/1/20242/25/20257/1/20257/1/2026
2/20/232/24/232/25/237/1/2310/4/232/24/242/25/247/1/242/25/257/1/20257/1/2026
Barbara A JacobsmeyerBarbara A Jacobsmeyer3,015 3,23920,785— — 3,23920,787— 20,78865,96365,964
Crissy B. CarlisleCrissy B. Carlisle6196912,5845,497— 6912,5845,4972,58610,994— 
Julie Jolley567 6092,0664,2876,7156092,0684,2882,0688,576
Tanya Marion— — 1,161 2,886 — — 1,164 2,886 1,166 5,772 — 
Julie D. Jolley
Tanya R. Marion
RSU Vestings after 12/31/2023RSU Vestings after 12/31/2023
NameNameRSU Vestings after 12/31/2022Name1/1/20243/1/20241/1/20253/1/20253/1/2026
1/2/231/1/241/1/25
Barbara A JacobsmeyerBarbara A Jacobsmeyer24,341 37,334 40,849 
Crissy B. CarlisleCrissy B. Carlisle2,503 3,985 10,896 
Julie Jolley2,294 3,515 8,718 
Tanya Marion— — 4,907 
Dylan C. Black
Julie D. Jolley
Tanya R. Marion

3329

Options Exercised and Stock Vested in 20222023
The following table sets forth information regarding the exercise of options and the vesting of shares held by our NEOs in 2022.2023.
 Option AwardsStock Awards
NameNumber of
Shares Acquired
on Exercise (1)
(#)		Value Realized
on Exercise
($)		Number of  Shares Acquired on Vesting (2)
(#)		Value Realized on Vesting
($)
Barbara A Jacobsmeyer
PSUs— — 7,536491,799
RSAs— — 3,675241,706
Crissy B. Carlisle
PSUs— — 93561,018
RSAs— — 81453,541
Julie Jolley
PSUs— — 1,01266,043
RSAs— — 47831,408
Jeanne Kalvaitis— — — — 
Tanya Marion— — — — 
Chad K. Knight
PSUs— — — — 
RSAs— — 34122,404
 
(1) No stock option exercises in 2022.
(2) Amounts shown are equity awards granted by Encompass under Encompass’s equity compensation plan with vesting in 2022 prior to the Separation.
Option AwardsStock Awards
Name
Number of Shares Acquired
on Exercise(1)
(#)
Value Realized
on Exercise
($)		Number of  Shares Acquired on Vesting
(#)
Value Realized on Vesting
($)(2)
Barbara A. Jacobsmeyer
RSAs— — 27,039416,647
RSUs— — 24,341320,328
Crissy B. Carlisle
RSAs— — 9,391123,272
RSUs— — 2,50332,939 
Dylan C. Black
     RSAs— — — — 
     RSUs— — — — 
Julie D. Jolley
RSAs— — 14,244157,400
RSUs— — 2,29430,189
Tanya R. Marion— — 
   RSAs— — 4,047 51,045 
   RSUs— — — — 
(1) No stock option exercises in 2023.
(2) The dollar amounts are based on the market value on the date of vesting.
Potential Payments upon Termination of Employmentor Change in Control
The following tables describe the potential payments and benefits under the Company’s compensation and benefit plans and arrangements to which the NEOs would be entitled upon termination of employment by us without “cause” or“cause,” by the executive for “good reason” or “retirement,” or due to death or “disability,” or in the event of a “change in control,” as thosesuch terms are defined below. Mr. Knight is not included in the table below due to his separation from Company in 2022, which is discussed on page 30applicable arrangements (as summarized below).

There are no payments or benefits due in the event of a termination of employment by us for cause. As previously discussed, our Change in Control Benefits Plan does not provide cash benefits unless there is an associated termination of employment. Due to the numerous factors involved in estimating these amounts, the actual value of benefits and amounts to be paid can only be determined upon termination of employment. In the event an NEO breaches or violates the restrictive covenants contained in the awards under the 2022 Omnibus Performance Incentive Plan, Executive Severance Plan, or the Executive Change in Control Benefits Plan certain of the amounts described below may be subject to forfeiture and/or repayment.

For additional discussion of the material terms and conditions, including payment triggers, see “Severance Arrangements” beginning on page26. An executive cannot receive termination benefits under more than one of the plans or arrangements identified below. Retirement benefits are governed by the terms of the awards under our 2022 Omnibus Performance Incentive Plans. The following table assumes the listed triggering events occurred on December 31, 2022.
34

Name/Triggering Event
Lump Sum
Payments
($)(1)
Continuation of Insurance
Benefits
($)
Accelerated
Vesting of
Equity Awards
($)(2)
Total  Termination
Benefits
($)
Barbara A. Jacobsmeyer
Executive Severance Plan
Without Cause/For Good Reason2,550,00001,304,7963,854,796
Disability004,030,9614,030,961
Death004,030,9614,030,961
For Cause0000
Change in Control Benefits Plan4,567,01204,030,9618,597,973
Crissy B. Carlisle
Executive Severance Plan
Without Cause/For Good Reason800,0000211,0781,011,078
Disability00646,511646,511
Death00646,511646,511
For Cause0000
Change in Control Benefits Plan1,214,0100646,5111,860,521
Julie Jolley
Executive Severance Plan
Without Cause/For Good Reason780,0000231,6331,011,633
Disability00610,361610,361
Death00610,361610,361
For Cause0000
Change in Control Benefits Plan1,201,0130610,3612,231,000
Jeanne Kalvaitis
Executive Severance Plan
Without Cause/For Good Reason275,01800275,018
Disability0000
Death0000
For Cause0000
Change in Control Benefits Plan579,82700579,827
Tanya Marion
Executive Severance Plan
      Without Cause For Good Reason350,000059,607409,607
Disability00262,437262,437
Death00262,437262,437
For Cause0000
Change in Control Benefits Plan767,5500262,4371,029,987
(1)The Company automatically reduces payments under the Change in Control Benefits Plan to the extent necessary to prevent such payments being subject to “golden parachute” excise tax under Section 280G and Section 4999 of the Internal Revenue Code, but only to the extent the after-tax benefit of the reduced payments exceeds the after-tax benefit if such reduction were not made (“best payment method”). The lump sum payments shown may be subject to reduction under this best payment method.
(2)The amounts reported in this column reflect outstanding equity awards, the grant date values of which along with accrued dividends and dividend equivalents have been reported as compensation in 2022 or prior years. The value of the accelerated vesting of equity awards listed in this column has been determined based on the $13.16 closing price of our common stock on the last trading day of 2022. The Committee may, in its discretion, provide that upon a change in control: (x) equity awards be canceled in exchange for a payment in an amount equal to the fair market value of our stock immediately prior to the change in control over the exercise or base price (if any) per share of the award, and (y) each award be canceled without payment therefore if the fair market value of our stock is less than the exercise or purchase price (if any) of the award.
The amounts shown in the preceding table do not include payments and benefits to the extent they are provided on a nondiscriminatory basis to salaried employees generally upon termination of employment. The “Lump Sum Payments” column in the above table includes the estimated payments provided for under the plans described under “Severance Arrangements” beginning on page26. Additionally, the Executive Severance Plan and the Change in Control Benefits Plan provide that as a condition to receipt of any payment or benefits all participants must enter into a nonsolicitation, noncompete, nondisclosure, nondisparagement, and release agreement.agreement, which provides for: (1) full vesting of any unvested awards (other than options and SARs, which shall terminate and be forfeited) upon the participant's death or disability; and (2) prorated vesting (based on the number of full months from the grant date to the date of the participant's retirement) of any unvested awards (other than options and SARs, which shall terminate and be forfeited) upon the participant's retirement, in each case with any performance-based awards subject to the attainment of the applicable performance objectives (which may be waived or modified by the Compensation Committee as set forth in the Omnibus Plan).
For additional discussion of the material terms and conditions, including payment triggers, see “Severance Arrangements” beginning on page 24. An executive cannot receive termination benefits under more than one of the plans or arrangements identified below. The death, disability, and retirement benefits described below are governed by the terms of the awards under our Omnibus Plans. The following table assumes the listed triggering events occurred on December 31, 2023.



3530

Table Illustrating Potential Payments upon Termination or Change in Control
The table below providesfollowing tables provide information regarding the potential equity value accelerated upon retirement forbenefits to which each NEO had shewould be entitled in the event of termination of such NEO’s employment with our Company under specified circumstances, including in connection with a change in control. Except as otherwise noted, the amounts shown (1) are estimates only, and (2) assume that (a) termination was effective as of December 29, 2023 (in which case we would anticipate giving credit for the full calendar year for purposes of any proration calculations) and (b) in the case of a change in control, replacement awards are provided and the NEO terminates for “good reason” or is involuntarily terminated without cause immediately following the change in control. These amounts are based on the NYSE closing price of our common stock on December 29, 2023, which was $10.35. This table does not include the value of pro-rated annual incentive awards under the SMBP for the year of termination, as such awards would be deemed to have been earned by their terms as of the last business day of the fiscal year.
Triggering Event
NameElement of SeveranceWithout Cause or For Good Reason (no Change in Control)DisabilityDeath
Retirement(1)
Without Cause or For Good Reason (in Connection with Change in Control)
Barbara A.
  Jacobsmeyer
Cash Severance(2)
$2,125,000---$3,552,618
Health & Welfare Benefits(3)
$23,685---$23,685
Acceleration of Unvested Equity Awards(4)
$1,879,149$4,087,484$4,087,484$1,879,149$4,087,484
Total$4,027,834$4,087,484$4,087,484$1,879,149$7,663,787
Crissy B.
  Carlisle
Cash Severance(2)
$700,002---$1,017,346 
Health & Welfare Benefits(3)
$15,790---$15,790
Acceleration of Unvested Equity Awards(4)
$333,624$808,159$808,159$333,624$808,159
Total$1,049,416$808,159$808,159$333,624$1,841,295
Julie D.
  Jolley
Cash Severance(2)
$682,500---$947,423
Health & Welfare Benefits(3)
$15,510---$15,510
Acceleration of Unvested Equity Awards(4)
$266,940$638,678$638,678$266,940$638,678
Total$964,950$638,678$638,678$266,940$1,601,611
Dylan C.
  Black
Cash Severance(2)
$612,500---$1,041,250
Health & Welfare Benefits(3)
$15,266---$15,266
Acceleration of Unvested Equity Awards(4)
$73,995$295,979$295,979$73,995$295,979
Total$701,761$295,979$295,979$73,995$1,352,495
Tanya R.
  Marion
Cash Severance(2)
$612,504---$730,716
Health & Welfare Benefits(3)
$15,790---$15,790
Acceleration of Unvested Equity Awards(4)
$143,587$386,500$386,500$143,587$386,500
Total$771,881$386,500$386,500$143,587$1,133,006 
(1) None of our NEOs are currently retirement eligible, but amounts reflected in the foregoing table assume the executive is retirement eligible.
(2) “Without Cause or For Good Reason (no Change in Control)” amount equals 2.50x (CEO) or 1.75x (other NEOs) of base salary and “Without Cause or For Good Reason (in Connection with Change in Control)” amount equals 2.50x (CEO) or 1.75x (Other NEOs) base salary plus average actual bonus (based on December 31, 2022. Asprior 3 years).
(3) Amount equals 18 months (CEO) or 12 months (other NEOs) of December monthly employer-paid benefit.
31 2022, Ms. Kalvaitis is

(4) Amount in the only NEO eligible“Without Cause or For Good Reason (no Change in Control)” column represents the value of accelerated equity awards as provided under the Executive Severance Plan; amounts in “Disability,” “Death,” and “Retirement” columns represent the value of accelerated equity awards as provided under the Omnibus Plan; and amount in the “Without Cause or For Good Reason (in Connection with Change in Control)” column represents the value of accelerated equity awards as provided under the Change in Control Benefits Plan (in each case, assuming target level of performance for retirement as defined below.any performance-based awards).
Named Executive OfficerAccelerated Vesting of Equity Awards Due to 
Retirement (Assuming Retirement Eligible)($)
Barbara A. Jacobsmeyer1,304,796 
Crissy B. Carlisle211,078 
Julie Jolley231,633 
Jeanne Kalvaitis— 
Tanya Marion59,607 
Definitions
“Cause,” as defined the Executive Severance Plan and Change in Control Benefits Plan and unless otherwise set forth in an individual agreement, means, in general terms:
(i)the Company’s procurement of evidence of the participant’s act of fraud, misappropriation, or similar offenses affectingembezzlement with respect to the Company;Company or any of its subsidiaries;
(ii)the Participant’s indictment for, conviction of, or plea of guilty or no contest to, any felony;misdemeanor involving moral turpitude or any felony (other than a minor traffic violation);
(iii)the suspension or debarment of the participant or of the Company or its affiliates from participation in any federalFederal or state health care program;program as a result of any willful or grossly negligent act or omission of the participant in connection with his or her employment with the Company or any of its subsidiaries;
(iv)anthe participant’s admission, or a finding by a court or the SEC (or a similar state agency), of liability or finding, of afor the violation of any securities laws, excluding anyother than those that are noncriminal;
(v)a formal indication that the personparticipant is a target or the subject of any investigation or proceeding into the actions or inactions of the participant for a violation of any securities laws in connection with his employment by the Company, excluding any(other than those that are noncriminal; andnoncriminal);
(vi)the participant’s failure after reasonable prior written notice from the Company or any of its subsidiaries to comply with any valid and legal directive of the Chief Executive Officer of the Company or the Board that is not remedied within 30) days of the participant being provided written notice thereof from the Company;
(vii)any willful or gross misconduct by the participant in connection with the participant’s duties to the Company that could reasonably be expected to be materially injurious to the financial condition or business reputation of the Company or its affiliates; or
(viii)other than as provided in clauses (i) through (vii) above, the participant’s breach of any material provision of any employment agreement or other duties.material agreement with the Company, if applicable, or the participant’s breach of or failure to perform the material duties and responsibilities of the participant’s job, that is not remedied within 30 days or repeated breaches of a similar nature.
“Change in Control” (as defined in the Change in Control Benefits Plan), means, in general terms:
(i)the acquisition by any person or group of beneficial ownership of 30% or more of either the then-outstanding shares of common stock or the combined voting power of the Company’s then-outstanding voting securities;securities subject to certain exceptions; or
(ii)during any 24 month period, the individuals who currently constituteat the boardbeginning of directors,such period constituted the Board, or the “Incumbent Board,” cease for any reason to constitute at least a majority of the boardBoard (any person becoming a director in the future whose election, or nomination for election, was approved by a vote of at least a majority of the directors then constituting the Incumbent Board shall be considered as though such person were a member of the Incumbent Board); or
(iii)athe consummation of a reorganization, merger consolidation or share exchange, where persons who were the stockholdersconsolidation of the Company with or into another person or the merger of another person with or into the Company, or the sale of all or substantially all the assets of the Company to another person, other than a transaction following which (A) in the case of a merger or consolidation transaction, holders of securities that represented 100% of the combined voting power immediately prior to such reorganization, merger, consolidation or share exchange do nottransaction own at least 50%a majority of the combined voting power;power immediately after such transaction and (B) in the case of an asset sale, each transferee is owned by holders of securities that represented at least a majority of the combined voting power immediately prior to such sale; or
(iv)a liquidation or dissolution of the Company or the saleadoption of alla plan of liquidation or substantially alldissolution of its assets.the Company.
32

“Good Reason,” as defined in the Executive Severance Plan, means, in general terms:terms and subject to an applicable notice and cure period:
(i)an assignment of a position that is of a lesser rank than held by the participant prior to the assignment and that results in a material adverse change in such participant’s reporting position, duties or responsibilities or title or elected or appointed offices as in effect immediately prior to the change, or in the caseeffective date of a Change in Control ceasing to be an executive officer of a company with registered securities;such change;
(ii)a material reduction in compensationsuch participant’s “total compensation” from that in effect immediately prior to the Changeeffective date of such reduction, where “total compensation” means the sum of base salary, target bonus opportunity and the opportunity to receive compensation in Control;the form of equity in the Company, subject to certain exceptions; or
(iii)any change in benefit level under a benefit plan if such change in status occurs during the period beginning 6 months prior to a Change in Control and ending 24 months after it; or
(iv)any change of more than 50 miles in the location of the principal place of employment.employment of such participant immediately prior to the effective date of such change.
The Good Reason definition in the Change in Control Benefits Plan is substantially the same as the definition set forth above, provided that such definition also includes as triggers: (1) in the case of an executive officer of the Company, ceasing to be an executive officer of a company with securities registered under the Exchange Act and (2) any change in a participant’s status as a Tier 1 or Tier 2 participant under such plan to a status that provides a lower benefit under such plan during the applicable change in control protection period.
“Retirement” means the voluntary termination of employment by a participant after attaining (a) age 65 or (b) in the event that person hasthe participant, as defined in the Omnibus Plan, been employed for 10 or more years on the date of termination, age 60.
36

CEO Pay Ratio
Nonqualified Deferred Compensation PlanSEC regulations require that we provide a comparison of the annual total compensation of Barb Jacobsmeyer, our President and Chief Executive Officer in 2023, to the annual total compensation of our median employee. For purposes of providing the comparison in accordance with SEC regulations, we identified a “median employee” and compared Ms. Jacobsmeyer’s annual total compensation to that of the median employee for our last completed fiscal year, 2023.
Encompass maintaines a nonqualified deferred•Ms. Jacobsmeyer’s annual total compensation plan,was $3,344,902.
•Our median employee’s annual total compensation was $55,994.
•The ratio of Ms. Jacobsmeyer’s annual total compensation to our median employee’s annual total compensation was approximately 60:1.
As of December 31, 2023, we employed over 10,800 employees. We identified the Encompass Health Corporation Nonqualified Retirement Plan, ormedian employee in 2023 by ranking the “NQ Plan,” in order to allow deferrals above what is limitedtotal compensation based on W-2 Box 1 “Wages, Tips and Other Compensation” amounts for all employees, excluding Ms. Jacobsmeyer, who were employed by the IRS. Our NEOs were eligible in 2022 to participateCompany on December 31, 2023. We annualized compensation for all permanent employees who joined the Company during 2023. Annual total compensation for the median employee is calculated in the NQ Plan,same manner as the provisions of which follow Encompass’ 401(k) Plan. Participants may request, on a daily basis, to have amounts credited to their NQ Plan accounts track the rate of return based on one or more benchmark mutual funds, which are substantially the same funds as those offered under our 401(k) Plan.
NQ Plan participants may elect to defer from 1% to 100% of compensation (W-2 compensation excluding certain reimbursements, stock awards, and perquisites) to the NQ Plan. Encompass makes an employer matching contribution to the NQ Plan equal to 50% of the participant’s deferral contributions, up to 6% of such participant’s total compensation, less any employer matching contributions made on the participant’s behalf to the 401(k) Plan. In addition, Encompass may elect to make a discretionary contribution to the NQ Plan with respect to any participant. Encompass did not elect to make any discretionary contributions to the NQ Plan for 2022. All deferral contributions made to the NQ Plan are fully vested when made and are credited to a separate bookkeeping account on behalf of each participant. Employer matching contributions vest once the participant has completed three years of service.
Deferral contributions will generally be distributed, as directed by the participant, upon either a termination of service or the occurrence of a specified date. Matching and discretionary contributions are distributed upon termination of service. Distributions may also be elected by a participantamount set forth in the event of an unforeseen emergency in which case participation in the NQ Plan will be suspended. Distributions will be made in cash in the form of a lump sum payment or annual installments over a two to fifteen year period, as elected by the participant. Any amounts that are payable from the NQ Plan upon a termination of employment are subject to the six month delay applicable to specified employees under section 409A of the Code.
Name
Executive
Contributions
in Last
Fiscal Year
($)(1)
Registrant
Contributions
in Last
Fiscal Year
($)(2)
Aggregate Earnings/(Losses) in Last Fiscal Year ($)(3)
Aggregate
Withdrawals/
Distributions
($)
Aggregate Balance at Last Fiscal Year-End ($)(4)
Barbara A. Jacobsmeyer130,70821,661(79,431)—599,272
Crissy B. Carlisle5,077 462(15,923)—72,235 
(1) All amounts in this“Total” column are included in the 2022 amounts represented as “Salary” and “Non-Equity Incentive Plan Compensation,” except $130,708 for Ms. Jacobsmeyer is included in the 2021 amounts, in the Summary Compensation Table.
(2) Represents contributions made by Encompass. All amounts We believe the pay ratio information set forth above constitutes a reasonable estimate, calculated in a manner consistent with the applicable SEC regulations.
The composition of our workforce greatly impacts this column are includedratio. Approximately 28% of our workforce consists of employees working less than full-time, which is a common employment arrangement in the 2022 amounts represented as “All Other Compensation” except $21,661healthcare services sector. Flexible staffing arrangements that fit employees’ needs allow us to attract and retain well-qualified employees. However, in accordance with applicable rules, we did not make any full-time equivalent adjustments for Ms. Jacobsmeyer is included inany such employees.
Because other companies may use different methodologies to identify their median employees, the 2021 amounts, inpay ratio set forth above may not be comparable to the Summary Compensation Table.pay ratios used by other companies.

(3) No amounts in this column are included or are required to be included in the Summary Compensation Table.
(4) Other than the amounts reported in this table for 2022, the balances in this column were previously reported as “Salary,” “Non-Equity Incentive Plan Compensation” and “All Other Compensation” in our Summary Compensation Tables in previous years, except for the following amounts which represent the aggregate earnings, all of which are non-preferential and not required to be reported in the Summary Compensation Table: $86,941 for Ms. Jacobsmeyer and $18,966 for Ms. Carlisle.
3733

Equity Compensation Plans
The following table sets forth, as of December 31, 2022, information concerning compensation plans under which our securities are authorized for issuance. The table does not reflect grants, awards, exercises, terminations, or expirations since that date. All share amounts and exercise prices have been adjusted to reflect stock splits that occurred after the date on which any particular underlying plan was adopted, to the extent applicable.
Plan CategoryNumber of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and RightsWeighted Average Exercise Price of Outstanding Options, Warrants and RightsNumber of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) 
(a)(#)

(b)($)

(c)(#)
Equity compensation plans approved by security holders584,252 27.075,961,543 
Equity compensation plans not approved by security holders— — 
Total584,252 27.075,961,543 

2022 Omnibus Performance Incentive Plan
Our stockholders approved the 2022 Omnibus Performance Incentive Plan or the “2022 Plan,” to provide forpermit the grant of stock options, restricted stock, stock appreciation rights, deferred stock, other stock-based awards and cash-settled awards, including our SMBP awards, to our directors, executives and other key employees as determined by our Board or Compensation and Human Capital Committee in accordance with the terms of the plan and evidenced by an award agreement with each participant. The 2022Omnibus Plan has an expiration date of July 1, 2032. Any awards outstanding under the 2022 Plan at the time of its termination will remain in effect in accordance with their terms. The aggregate number of shares of common stock available for issuance in connection with new awards under the 2022 Plan shown above is subject to equitable adjustment upon a change in capitalization of the Company or the occurrence of certain transactions affecting the common stock reserved for issuance under the plan. Any awards under the 2022Omnibus Plan must have a purchase price or an exercise price not less than the fair market value of such shares of common stock on the date of grant.

Compensation Committee Interlocks and Insider Participation
No member of our Compensation and& Human Capital Committee is an officer or employee of the Company. None of our current executive officers serves or has served as a member of the board of directorsBoard or compensation committee of any other company that had one or more executive officers serving as a member of our Board or Compensation and& Human Capital Committee.
During 2023 the following directors severed on our Compensation and& Human Capital Committee Report
The Compensation and Human Capital Committee reviewed and discussed with management the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K, and, based upon such review and discussions, the Compensation and Human Capital Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Amendment for the year ended December 31, 2022.

Compensation and Human Capital Committee
Committee: Yvonne M. Curl, (Chair)
Erin P. Hoeflinger,
Susan A. LaMonica
La Monica and L. Edward Shaw, Jr.
3834

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The following table sets forth information regarding the beneficial ownership of our common stock as of April 26, 202315, 2024 by (1) each person who is known by us to own beneficially more than 5% of the outstanding shares of our common stock, (2) each of our directors, (3) each of our named executive officers, serving at the end of the last completed fiscal year named in the Summary Compensation Table, and (4) all of our current directors and executive officers as a group. Percentage of ownership is based on 50,089,32850,155,782 shares of common stock outstanding as of April 26, 2023.15, 2024.
NameName
Common Shares
Beneficially
Owned(1)
Percent of  ClassName
Common Shares
Beneficially
Owned(1)
Percent of Class
Greater Than 5% Beneficial OwnersGreater Than 5% Beneficial Owners
BlackRock, Inc. BlackRock, Inc.7,166,740 (2)14.3%
Deerfield Management Company, L.P.2,996,000 (3)6.0%
BlackRock, Inc.
BlackRock, Inc.8,094,739 (2)16.1%
The Vanguard Group The Vanguard Group5,499,624 (4)11.0% The Vanguard Group5,706,087 (3)(3)11.4%
Deerfield Mgmt, L.P. Deerfield Mgmt, L.P.4,997,746 (4)10.0%
Non-Employee Directors(6)
Non-Employee Directors(6)
Non-Employee Directors(6)
Non-Employee Directors(6)
Leo I. Higdon, Jr., Chairperson
Leo I. Higdon, Jr., Chairperson
Leo I. Higdon, Jr., Chairperson
Leo I. Higdon, Jr., Chairperson
25,000 (5)*37,702 (5)(5)*
Jeffrey W. Bolton Jeffrey W. Bolton15,597 * Jeffrey W. Bolton32,299 **
Tina L. Brown-Stevenson Tina L. Brown-Stevenson9,645 * Tina L. Brown-Stevenson22,347 **
Yvonne M. Curl Yvonne M. Curl17,608  * Yvonne M. Curl30,310   *
Charles M. Elson Charles M. Elson22,069 * Charles M. Elson34,771 **
Erin P. Hoeflinger Erin P. Hoeflinger13,597 * Erin P. Hoeflinger28,399 **
Susan A. LaMonica23,095 *
Susan A. La Monica Susan A. La Monica35,797 *
John E. Maupin, Jr. John E. Maupin, Jr.17,390  * John E. Maupin, Jr.30,092   *
Stuart M. McGuigan Stuart M. McGuigan1,897 * Stuart M. McGuigan14,599 **
Gregory S. Rush Gregory S. Rush16,597 * Gregory S. Rush29,299 **
Barry P. Schochet Barry P. Schochet1,897 * Barry P. Schochet21,924 **
L. Edward Shaw, Jr. L. Edward Shaw, Jr.28,989 * L. Edward Shaw, Jr.51,691 **
Executive Officers(6)
Named Executive Officers(6)
Barbara A. Jacobsmeyer
Barbara A. Jacobsmeyer
Barbara A. Jacobsmeyer Barbara A. Jacobsmeyer549,251 (7)1.1%643,182 (7)(7)1.3%
Crissy B. Carlisle Crissy B. Carlisle72,498 * Crissy B. Carlisle88,342 **
Julie H. Jolley58,838 *
Jeanne Kalvaitis5,843 *
Tanya Marion29,888 *
All directors and current executive officers as a group (19 total)955,466 (5)(7)1.9%
Dylan C. Black Dylan C. Black25,471 *
Julie D. Jolley Julie D. Jolley71,429 *
Tanya R. Marion Tanya R. Marion44,375 *
All directors and executive officers as a group (19 total)All directors and executive officers as a group (19 total)1,310,222 (5)(7)2.6%
* Less than 1%.
(1)According to the rules adopted by the SEC, a person is a beneficial owner of securities if the person or entity has or shares the power to vote them or to direct their investment or has the right to acquire beneficial ownership of such securities within 60 days through the exercise of an option, warrant or right, conversion of a security or otherwise. Unless otherwise indicated, each person or entity named in the table has sole voting and investment power, or shares voting and investment power, with respect to all shares of stock listed as owned by that person.
(2)Based on a Schedule 13G/A filed with the SEC on February 10, 2023,January 22, 2024, BlackRock, Inc. (parent holding company/control person) reported, as of December 31, 2022,2023, beneficial ownership of 7,166,7408,094,739 shares, with sole voting power for 6,936,7737,956,961 shares and sole investment power for 7,166,7408,094,739 shares. This holder is located at 55 East 52nd Street,50 Hudson Yards, New York, NY 1005510001
(3)Based on a Schedule 13G/A filed with the SEC on February 10,13, 2024, The Vanguard Group (investment adviser) reported, as of December 31, 2023, beneficial ownership of 5,706,087 shares, with shared voting power for 31,940 shares, sole investment power for 5,632,412 shares, and shared investment power for 73,645 shares. This holder is located at 100 Vanguard Blvd., Malvern, PA 19355.
(4)Based on a Schedule 13G/A filed with the SEC on February 12, 2024, Deerfield Mgmt, L.P. (parent holding company/control person) reported, as of December 31, 2022,2023, beneficial ownership of 2,996,0004,997,746 shares, with shared voting and investment power for 2,996,0004,997,746 shares. This holder is located at 345 Park Avenue South, 12th Floor, New York, NY 10010.
(4)Based on a Schedule 13G/A filed with the SEC on February 9, 2023, The Vanguard Group (investment adviser) reported, as of December 31, 2022, beneficial ownership of 5,499,624 shares, with shared voting power for 16,244 shares, sole investment power for 5,435,458 shares, and shared investment power for 64,166 shares. This holder is located at 100 Vanguard Blvd., Malvern, PA 19355.
(5)Includes 7,926 shares indirectly beneficially owned in a family trust.
(6)The address of our directors and executive officers is c/o Enhabit, Inc., 6688 N. Central Expressway, Suite 1300, Dallas, Texas 75206.
(7)Includes 172,668172,197 shares issuable upon exercise of options.

39
35

Equity Compensation Plan Information
The following table sets forth, as of December 31, 2023, information concerning compensation plans under which our securities are authorized for issuance. The table does not reflect grants, awards, exercises, terminations, or expirations since that date. All share amounts and exercise prices have been adjusted to reflect stock splits that occurred after the date on which any particular underlying plan was adopted, to the extent applicable.
Plan Category
Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights(1)
Weighted Average Exercise Price of Outstanding Options, Warrants and Rights(2)
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))(3) 
(a)(#)(b)($)(c)(#)
Equity compensation plans approved by security holders1,425,308 24.444,843,604 
Equity compensation plans not approved by security holders— —— 
Total1,425,308 24.444,843,604 
(1) Includes shares of our common stock to be issued under PSUs outstanding under the Omnibus Plan assuming we meet the target performance goals for the applicable three-year performance period.
(2) Represents the weighted-average exercise price of outstanding stock options only and excludes PSU and RSU awards because those awards do not have an exercise price.
(3) Represents the number of securities available for future issuance under the Omnibus Plan (which permits the grant of many types of awards, including awards other than options, warrants and rights).
36

Delinquent Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires our directors, executive officers, and the persons who beneficially own more than 10% of our common stock, to file reports of ownership and changes in ownership with the Securities and Exchange Commission. Copies of all filed reports are required to be furnished to us. Based solely on the reports received by us and on the representations of the reporting persons, we believe that these persons have complied with all applicable filing requirements during 2022, except the following, which were not timely filed.
•Due to an unanticipated delay in acquiring EDGAR filing codes, Ms. Curl, a member of our Board filed her Form 3 late.

•As described in our Form 10 and further described on page 23, at the time of the Separation unvested PSUs and RSAs previously issued by Encompass and held by Enhabit employees converted to Enhabit equity awards (the “Converted Awards”). Ownership of the Converted Awards was not reported for our Section 16 officers at the time of the Separation. Amended Form 4s have been filed for Mmes. Jacobsmeyer, Carlisle, Jolly and Marion to include the Converted Awards.

•In January and February of 2023 vesting occurred on certain Converted Awards. Tax withholding amounts were net settled at the time of vesting and consequently shares were surrendered by each participant to pay the participant’s withholding tax obligation. The surrendered shares were not reported for our Section 16 officers at the time of vesting. Form 4s have been filed for Mmes. Jacobsmeyer, Carlisle, Jolly and Marion to report the surrender of shares.

40

Item 13. Certain Relationships and Related Transactions, and Director Independence
Review and Approval of Transactions with Related Persons
For purposes of this section,All related party transactions must be approved in accordance with our Related Party Transactions Policy. As defined in our Related Party Transaction Policy, a “related party” refers tois any executive officer, Board member, of our Board, or director nominee; any immediate family member of an executive officer, Board member, or director nominee; or any beneficial owner of more than 5% of any class of the Company’s voting securities. The Nominating/Corporate Governance Committee (the “Committee”) considers, among other matters, whetherA related party transaction is a transaction betweenor relationship in which the Company or any of its subsidiaries is a participant, and any related party andhas or will have a direct or indirect interest. Pursuant to our Related Party Transaction Policy, the Company presents any inappropriate conflicts of interest or impairs the “independence” of an outside director, or both. The Board has also determined that certain transactions do not constitute related party transactions. These include:

•compensation of the executive officers and Board members, including the reimbursement of reasonable business and travel expenses incurred in the ordinary course of business;

•any transaction involving indemnification or advancement of expenses made pursuant to the Company’s certificate of incorporation, bylaws, or an agreement approved by the Board, and

Board;
•any transaction with another firm, corporation or entity at which a related party’s only relationship is as an employee of such other firm, corporation or entity, provided the aggregate amount involved does not exceed the greater of $1 million or 1% of such other company’s annual consolidated gross revenues.revenues;

•any transaction with another firm, corporation or entity at which a related party’s only relationship is as a director or as the owner together with any other related party of less than a ten percent equity or limited partnership interest in the entity (and none of such related parties serves as a general partner);
•any transaction in which the related party’s interest arises solely from ownership of securities issued by the Company and all holders of such securities receive the same benefits pro rata as the related party; and
•any transaction involving a related party where the rates or charges involved are determined by competitive bids.
Each director, director nominee and executive officer is responsible for providing prompt written notice to the General Counsel of any potential related party transaction. If the General Counsel determines that the proposed transaction is a related party transaction, it is submitted to the Nominating & Corporate Governance Committee (the “Committee”) for review and approval at the next Committee meeting.approval. The Committee may determine either to permit the related party transaction or prohibit it, if such transaction is inconsistent with the interests of the Company and its stockholders.

The Committee considers, among other matters, whether a transaction between a related party and the Company presents any inappropriate conflicts of interest or impairs the “independence” of an outside director, or both. Any member of the Committee who has an interest in the transaction under discussion must abstain from voting on the approval of the related party transaction, but may, if requested by the chairperson of the Committee, participate in some or all of the Committee’s discussions of the related party transaction. In addition, the Committee or its chairperson may determine that a related party transaction should be brought before the Board, and the Board may in any case elect to review any such matter.
Since the beginning of our last fiscal year, there have been no related party transactions between the Company and a related party that would be reportable under SEC rules or regulations.
Transactions
Director Independence
The NYSE listing standards require that the Company have a majority of independent directors and provide that no director will qualify as “independent” for these purposes unless the Board affirmatively determines that the director has no material relationship with Related Personsthe Company. Additionally, the listing standards set forth a list of relationships and transactions that would prevent a finding of independence if a director or an immediate family member of that director were a party. Other than Ms. Jacobsmeyer, our President and CEO, the Board is entirely independent.
Our policies regarding transactionsOn an annual basis, the Board undertakes a review of the independence of the directors. In accordance with related personsthe NYSE listing standards, we do not consider a director to be independent unless the Board determines (i) the director meets all NYSE independence requirements and other matters constituting potential conflicts(ii) the director has no material relationship with the Company (either directly or as a partner, stockholder or officer of interest are contained in ouran organization that has a relationship with the Company). Members of the Audit, Compensation & Human Capital, and Nominating & Corporate Governance Guidelines, Related Party Transaction Policy and StandardsCommittees must also meet applicable independence tests of Business Ethics and Conduct which can be found on our website at https://investors.ehab.com/governance/governance-documents.

Relationship with Encompass

Separation and Distribution Agreement

Enhabit entered into a Separation and Distribution Agreement with Encompass, which sets forth the agreements governing the relationship between Encompass and Enhabit following the separation and distribution.

Allocation of Assets and Assumption of Liabilities

The Separation and Distribution Agreement identified the assets to be allocated, the liabilities to be assumedNYSE and the contracts to be allocated toSEC. In connection with this determination, each director and executive officer completes a questionnaire which requires disclosure of, Enhabit and Encompass as part of the separation of Encompass into two independent companies.

Except as expressly set forth in the Separation and Distribution Agreementamong other topics: any transactions or relationships between any director or any ancillary agreement, neithermember of Enhabit nor Encompass made any representationhis or warranty as toher immediate family and the assets, business or liabilities transferred or assumed as part of the Separation, as to any approvals or notifications required in connection with any such transfers, as to the value of or the freedom from any security interests of any of the assets transferred, as to the absence or presence of any defenses or right of setoff or freedom from counterclaim with respect to any claim or other asset of either of Enhabit or Encompass, or as to the legal sufficiency of any document or instrument delivered to convey title to any asset or thing of value to be transferred in connection with the Separation.Company and its subsidiaries, affiliates, our independent
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Transitional Trademark License

The Separationregistered public accounting firm or any advisors to the Compensation & Human Capital Committee; any transactions or relationships between any director or any member of his or her immediate family and Distribution Agreement provides that Encompass grants to Enhabit a non-exclusive, worldwide, royalty-free license to use the “Encompass” name, marks and related logos (the “Licensed Trademarks”) for a period beginning on the datemembers of the distribution and extending for a certain transitional period to allow for the completionsenior management of the rebrandingCompany or their affiliates; and any charitable contributions to not-for-profit organizations for which our directors or immediate family members serve as executive officers.
Our Board has determined that all 12 of Enhabit. Encompass retains all right, title and interest in the Licensed Trademarks and all goodwill associated therewith. This trademark license includes certain customary quality control provisions which imposes obligations and restrictions on Enhabit’s use of the Licensed Trademarks.

Claims

In general, each party to the Separation and Distribution Agreement assumes liability for all pending, threatened and unasserted legal matters related to its own business or its assumed or retained liabilities and will indemnify the other party for any liability to the extent arising out of or resulting from such assumed or retained legal matters.

Indemnification

In the Separation and Distribution Agreement, Enhabit agrees to indemnify, defend and hold harmless Encompass, each of Encompass’s controlled affiliates and each of their respectiveour non-employee directors officers and employees, from and against all liabilities to the extent relating to, arising out of or resulting from:

•certain liabilities related to the Enhabit business or Enhabit assets (the “Enhabit Liabilities”);
•Enhabit’s failure or the failure of any other person to pay, perform or otherwise promptly discharge any of the Enhabit Liabilities,are independent in accordance with their respective terms, whether prior to, at or afterour Corporate Governance Guidelines and the distribution;
•except to the extent relating to an Encompass Liability, any guarantee, indemnification or contribution obligation for the benefit of Enhabit by Encompass that survives the distribution;
•any breach by EnhabitNYSE listing standards. All of the Separation and Distribution Agreement or anymembers of the ancillary agreements;Audit, Compensation & Human Capital, Nominating & Corporate Governance, and
•any untrue statement or alleged untrue statement or omission or alleged omission of material fact in the Form 10 (as amended or supplemented), except for any such statements or omissions made explicitly in Encompass’s name.

Encompass agrees to indemnify, defend and hold harmless Enhabit, each of Enhabit’s controlled affiliates and each of their respective directors, officers and employees from and against all liabilities to the extent relating to, arising out of or resulting from:

•the Encompass Liabilities;
•the failure of Encompass or any other person to pay, perform or otherwise promptly discharge any of the Encompass Liabilities in accordance with their respective terms whether prior to, at or after the distribution;
•except to the extent relating to a Enhabit Liability, any guarantee, indemnification or contribution obligation for the benefit of Encompass by Enhabit that survives the distribution;
•any breach by Encompass of the Separation and Distribution Agreement or any of the ancillary agreements; and
•any untrue statement or alleged untrue statement or omission or alleged omission of a material fact made explicitly in Encompass’s name in the Form 10 (as amended or supplemented).

The Separation and Distribution Agreement also establishes procedures with respect to claims subject to indemnification and related matters.

Indemnification with respect to taxes, and the procedures related thereto, is governed by the tax matters agreement.

Insurance

The Separation and Distribution Agreement provides for the allocation between the parties of rights and obligations under existing insurance policies with respect to claims covered by Encompass’s insurance prior to the distribution and sets forth procedures for the administration of insured claims and related matters.

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Further Assurances

In addition to the actions specifically provided for in the Separation and Distribution Agreement, except as otherwise set forth therein or in any ancillary agreement, Enhabit and Encompass agree in the Separation and Distribution Agreement to use reasonable best efforts, prior to, on and after the distribution date, to take, or cause to be taken, all actions, and to do, or cause to be done, all things necessary, proper or advisable under applicable laws, regulations and agreements to consummate and make effective the transactions contemplated by the Separation and Distribution Agreement and the ancillary agreements.

Dispute Resolution

The Separation and Distribution Agreement contains provisions that govern, except as otherwise provided in any ancillary agreement, the resolution of disputes, controversies or claims that may arise between Enhabit and Encompass related to the separation or distribution and that are unable to be resolved through good faith discussions between Enhabit and Encompass. These provisions contemplate that efforts will be made to resolve disputes, controversies and claims by escalation of the matter to executives of the parties in dispute. If such efforts are not successful, one of the parties in dispute may submit the dispute, controversy or claim to binding arbitration for resolution, subject to the provisions of the Separation and Distribution Agreement.

Amendment and Termination

The Separation and Distribution Agreement may not be amended or terminated after the distribution date, except by an agreement in writing signed by both Enhabit and Encompass.

Transition Services Agreement

Enhabit entered into a transition services agreement with Encompass pursuant to which Enhabit and Encompass and Enhabit’s respective affiliates provide each other, on an interim, transitional basis, various services to help ensure an orderly transition following the separation and the distribution, such as finance, accounting, legal, information technology, human resources, employee benefits and other services.

The services commenced on the date of the distribution and will terminate no later than 24 months following the distribution. Enhabit and Encompass have agreed to perform Enhabit’s respective services in a manner that is substantially similar in all material respects to which the same or similar services were performed by or on behalf of Enhabit or Encompass, as applicable, prior to the distribution or, if not so previously provided, then substantially similar in all material respects to which similar services are provided by or on behalf of Enhabit or Encompass to Enhabit’s or Encompass’s affiliates or other business components, as applicable.

The transition services agreement generally provides that the applicable service recipient indemnifies the applicable service provider for liabilities that such service provider incurs arising from the provision of services other than liabilities arising from such service provider’s gross negligence, bad faith or willful misconduct or fraud, and that the applicable service provider indemnifies the applicable service recipient for liabilities that such service recipient incurs arising from such service provider’s gross negligence, bad faith or willful misconduct or fraud. Subject to certain exceptions, the liabilities of each party providing services under the transition services agreement is generally limited to the aggregate charges actually paid or payable to such party by the other party for services pursuant to the transition services agreement. The transition services agreement also provides that the provider of a service will not be liable to the recipient of such service for any special, indirect, incidental, punitive or consequential or similar damages.

Tax Matters Agreement

Enhabit entered into a tax matters agreement with Encompass that governs Enhabit’s respective rights, responsibilities and obligations with respect to taxes (including responsibility for taxes arising in the ordinary course of business and taxes, if any, incurred as a result of any failure of the distribution to qualify as tax-free for U.S. federal income tax purposes), entitlement to refunds, allocation of tax attributes, preparation of tax returns, control of tax contests and other matters.

In addition, the tax matters agreement imposes certain restrictions on Enhabit and Enhabit’s subsidiaries until the second anniversary of the distribution (including restrictions on share issuances, business combinations, sales of assets and similar transactions) that are designed to preserve the tax-free status of the distribution and certain related
43

transactions. The tax matters agreement provides special rules that allocate tax liabilities in the event the distribution or certain related transactions are not tax-free. In general, under the tax matters agreement, each party is expected to be responsible for any taxes imposed on Encompass or Enhabit that arise from the failure of the distribution or certain related transactions to qualify as a transaction that is generally tax-free for U.S. federal income tax purposes under Section 355 of the Code, to the extent that the failure to so qualify is attributable to actions, events or transactions relating to such party’s respective stock, assets or business, or a breach of the relevant covenants made by that party in the tax matters agreement.

Employee Matters Agreement

Enhabit entered into an employee matters agreement with Encompass that addresses employment, compensation and benefits matters, including the allocation and treatment of assets and liabilities relating to employees and compensation and benefit plans and programs in which Enhabit’s employees participated prior to the distribution, as well as other human resources, employment and employee benefit matters. The employee matters agreement also provides, subject to customary exceptions, that neither Encompass nor Enhabit nor their respective subsidiaries will solicit for employment or hire any individual who is an employee at the level of director (eligible to participate in the senior management bonus plan) or above of the other party or its subsidiaries for a period of one year following the effective time of the distribution. The employee matters agreement also specifies the treatment of equity-based awards granted by Encompass prior to the distribution.

The total amount of payments under these agreements with Encompass was approximately $2.1 million for the year ended December 31, 2022. Care, Compliance & Cybersecurity Committees satisfy those independence tests.

Item. 14Item 14. Principal Accountant Fees and Services
Pre-Approval of Principal Accountant Services
The Audit & Finance Committee is responsible for the appointment, oversight, and evaluation of our independent registered public accounting firm. In accordance with our Audit & Finance Committee’s charter, our Audit & Finance Committee must approve, in advance of the service, all audit and permissible non-audit services provided by our independent registered public accounting firm. Our independent registered public accounting firm may not be retained to perform the non-audit services specified in Section 10A(g) of the Securities Exchange Act of 1934, as amended. The Audit & Finance Committee has concluded that provision of the non-audit services described in that section is not compatible with maintaining the independence of PricewaterhouseCoopers LLP.
The Audit & Finance Committee has established a policy regarding pre-approval of audit and permissible non-audit services provided by our independent registered public accounting firm, as well as all engagement fees and terms for our independent registered public accounting firm. Under the policy, the Audit & Finance Committee must approve the services to be rendered and fees to be charged by our independent registered public accounting firm. Typically, the Audit & Finance Committee approves services up to a specific amount of fees. The Audit & Finance Committee must then approve, in advance, any services or fees exceeding those pre-approved levels. The Audit & Finance Committee may delegatehas delegated general pre-approval authority of up to a subcommittee of which the chairman of$30,000 to the Audit & Finance Committee is a member, provided that any delegated approval is limited to services with fees of no more than 5% of previously approved amounts.chairperson.


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Principal Accountant Fees and Services
With respect to the audits for the yearyears ended December 31, 2023 and 2022, the Audit & Finance Committee approved the audit services to be performed by PricewaterhouseCoopers LLP, as well as certain categories and types of audit-related and permitted non-audit services. In 2023 and 2022, the Audit & Finance Committee approved all audit, audit-related, and other fees in accordance with SEC pre-approval rules. The following table shows the aggregate fees paid or accrued for professional services rendered by PricewaterhouseCoopers LLP for the years ended December 31, 2023 and 2022, with respect to various services provided to us and our subsidiaries.
For the Year Ended December 31,
2022
(In Millions)
Audit fees(1)
$1.8 
Audit-related fees— 
Total audit and audit-related fees1.8 
Tax fees— 
All other fees— 
Total fees$1.8 
(1)Audit fees – Represents aggregate fees paid or accrued for professional services rendered for the review of financial statements included in our Form 10-Q filing for the third quarter of 2022 and the audit of our consolidated financial statements.
For the Year Ended December 31,For the Year Ended December 31,
20232022
(In Millions)(In Millions)
Audit fees$2.3 $1.8 
Audit-related fees— — 
Total audit and audit-related fees2.3 1.8 
Tax fees— — 
All other fees— — 
Total fees$2.3 $1.8 

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PART IV

Item. 15Item 15. Exhibits and Financial Statement Schedules

The following Exhibits are filed as part of this report as required by Regulation S-K.
Exhibit
Number
Exhibit Description
31.1†31.1†
31.2†31.2†
101.INS†XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).
101.SCH†Inline XBRL Taxonomy Extension Schema Document.
101.CAL†Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF†Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB†Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE†Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.
† Submitted electronically herewith.

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Appendix A

Reconciliations of Non-GAAP Financial Measures to GAAP Results
Adjusted EBITDA is a non-GAAP measure of our financial performance. Management believes Adjusted EBITDA assists investors in comparing our operating performance across operating periods on a consistent basis by excluding items we do not believe are indicative of our operating performance.
We calculate Adjusted EBITDA as Net (loss) income adjusted to exclude (1) income tax (benefit) expense, (2) interest expense and amortization of debt discounts and fees, (3) depreciation and amortization, (4) gains or losses on disposal or impairment of assets or goodwill, (5) stock‑based compensation, (6) net income attributable to noncontrolling interest, (7) unusual or nonrecurring items not typical of ongoing operations, and (8) gain on consolidation of joint venture formerly accounted for under the equity method of accounting.
Adjusted EBITDA is not a measure of financial performance under generally accepted accounting principles in the United States of America (“GAAP”), and the items excluded from Adjusted EBITDA are significant components in understanding and assessing financial performance. Therefore, Adjusted EBITDA should not be considered a substitute for Net (loss) income. Because Adjusted EBITDA is not a measurement determined in accordance with GAAP and is thus susceptible to varying calculations, Adjusted EBITDA, as presented, may not be comparable to other similarly titled measures of other companies. Revenues and expenses are measured in accordance with the policies and procedures described in Note 1, Summary of Significant Accounting Policies, to the consolidated financial statements accompanying the 2023 Form 10-K.

Reconciliation of Net (loss) Income to Adjusted EBITDA
For the Year Ended December 31,
2023
(In Millions)
Net loss$(79.0)
Impairment of goodwill85.8 
Interest expense43.0 
Depreciation and amortization30.9 
Unusual or nonrecurring items that are not typical of ongoing operations(1)
21.2 
Income tax (benefit) expense(11.4)
Stock-based compensation8.9 
Net income attributable to noncontrolling interests(1.5)
(Gain) loss on disposal or impairment of assets(0.3)
Stock-based compensation included in overhead allocation— 
Adjusted EBITDA$97.6
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Reconciliation of Net Cash Provided by Operating Activities to Adjusted EBITDA
For the Year Ended December 31,
2023
(In Millions)
Net cash provided by operating activities$48.4 
Interest expense excluding amortization of debt discounts and fees40.9 
Unusual or nonrecurring items not typical of ongoing operations(1)
21.2 
Change in assets and liabilities, excluding derivative instruments(11.9)
Net income attributable to noncontrolling interests in continuing operations(1.5)
Other0.3 
Current portion of income tax (benefit) expense0.2 
Stock-based compensation included in overhead allocation— 
Adjusted EBITDA$97.6
(1)    Unusual or nonrecurring items in 2023 include (i) certain third-party, nonrecurring litigation fees related to a lawsuit in which the Company is a plaintiff, styled Enhabit, Inc. et al. v. Nautic Partners IX, L.P., et al. and pending in the Chancery Court of Delaware, and in which the Company has asserted claims for breach of fiduciary duty, aiding and abetting, and usurpation of corporate opportunity arising from actions involving its former officers; (ii) third-party legal and advisory fees related to the strategic review process; (iii) transition costs related to the Separation; (iv) costs related to restructuring and acquisitions and (v) third-party legal and advisory fees related to shareholder activism.shareholder activism..
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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Amendment to the Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized.
ENHABIT, INC.
By:/s/ Crissy B. Carlisle
Name:Crissy B. Carlisle
Title:Chief Financial Officer
Date:May 1, 2023April 26, 2024









[Signatures continue on the following page]
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      Pursuant to the requirements of the Securities Exchange Act of 1934, this Amendment to the Annual Report has been signed below by the following persons on behalf of the registrant and in the capacities and on the date indicated:
SignatureTitleDate
/s/ Barb JacobsmeyerPresident and Chief Executive Officer and Director
(Principal Executive Officer)
May 1, 2023April 26, 2024
Barb Jacobsmeyer
/s/ Crissy B. CarlisleChief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)
May 1, 2023April 26, 2024
Crissy B. Carlisle
*Director
May 1, 2023April 26, 2024
Jeffrey W. Bolton
*Director
May 1, 2023April 26, 2024
Tina L. Brown-Stevenson
*Director
May 1, 2023April 26, 2024
Yvonne M. Curl
*Director
May 1, 2023April 26, 2024
Charles M. Elson
*Director, Chairperson
May 1, 2023April 26, 2024
Leo I. Higdon Jr.
*Director
May 1, 2023April 26, 2024
Erin P. Hoeflinger
*Director
May 1, 2023April 26, 2024
Susan A. LaMonica
*Director
May 1, 2023April 26, 2024
John E. Maupin Jr.
*Director
May 1, 2023April 26, 2024
Stuart McGuigan
*Director
May 1, 2023April 26, 2024
Greg S. Rush
*Director
May 1, 2023April 26, 2024
Barry Schochet
*Director
May 1, 2023April 26, 2024
L. Edward Shaw, Jr.
/s/ Dylan C. Black
April 26, 2024
Dylan C. Black
Attorney-in-fact
* Signed by Dylan C. Black pursuant to a power of attorney.
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