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EXHIBIT 10.1
PEDIATRIX MEDICAL GROUP, INC.
AMENDED AND RESTATED 1992 STOCK OPTION PLAN
1. Purpose. The purpose of this Plan is to advance the interests of
Pediatrix Medical Group, Inc., a Florida corporation (the "Company"), providing
an additional incentive to attract and retain qualified and competent persons
who are key to the Company (as hereinafter defined), including key employees,
Officers and Directors, and upon whose efforts and judgment the success of the
Company is largely dependent, through the encouragement of stock ownership in
the Company by such persons.
2. Definitions. As used herein, the following terms shall have the meaning
indicated:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(c) "Committee" shall mean the stock option committee appointed by the
Board pursuant to Section 13 hereof or, if not appointed, the Board.
(d) "Common Stock" shall mean the Company's Common Stock, par value
$0.01 per share.
(e) "Company" shall refer to Pediatrix Medical Group, Inc., a Florida
corporation, its wholly-owned subsidiary, Pediatrix Medical Group of
Florida, Inc., and the following companies related to the company through
long-term management contracts and which provide the medical component of
the services required in respect of any arrangement where Pediatrix Medical
Group, Inc. provides the non-medical component of the services required in
respect of such arrangement: Pediatrix Medical Group of Arizona,
California, Colorado, Illinois, Kansas, Michigan, New Jersey, New York,
Ohio, Pennsylvania, Puerto Rico, Texas, Virginia and West Virginia and any
future majority owned subsidiary of the Company or any business entity,
partnership or other business entity related to the Company through a
long-term management contract with respect to the services described
herein.
(f) "Director" shall mean a member of the Board.
(g) "Disinterested Person" shall mean a Director who is not, during
the one year prior to his or her service as an administrator of this Plan,
or during such service, granted or awarded equity securities pursuant to
this Plan or any other plan of the Company or any of its affiliates, except
that:
(i) participation in a formula plan meeting the conditions in
paragraph (c)(2)(ii) of Rule 16b-3 promulgated under the Securities
Exchange Act shall not disqualify a Director from being a Disinterested
Person;
(ii) participation in an ongoing securities acquisition plan
meeting the conditions in paragraph (d)(2)(i) of Rule 16b-3 promulgated
under the Securities Exchange Act shall not disqualify a Director from
being a Disinterested Person; and
(iii) an election to receive an annual retainer fee in either cash
or an equivalent amount of securities, or partly in cash and partly in
securities, shall not disqualify a Director from being a Disinterested
Person.
(h) "Effective Date" shall mean September 20, 1995, the commencement
date of the initial public offering contemplated by the Registration
Statement filed with the Securities and Exchange Commission on Form S-1.
(i) "Employee Director" shall mean a member of the Board who is also
an employee of the Company or a Subsidiary.
(j) "Fair Market Value" of a Share on any date of reference shall be
the "Closing Price" (as defined below) of the Common Stock on the business
day immediately preceding such date, unless the
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Committee in its sole discretion shall determine otherwise in a fair and uniform
manner. For the purpose of determining Fair Market Value, the "Closing Price" of
the Common Stock on any business day shall be (i) if the Common Stock is listed
or admitted for trading on any United States national securities exchange, or if
actual transactions are otherwise reported on a consolidated transaction
reporting system, the last reported sale price of Common Stock on such exchange
or reporting system, as reported in any newspaper of general circulation, (ii)
if the Common Stock is quoted on the National Association of Securities Dealers
Automated Quotations System ("NASDAQ"), or any similar system of automated
dissemination of quotations of securities prices in common use, the last
reported sale price of Common Stock on NASDAQ or such system, or (iii) if
neither clause (i) or (ii) is applicable, the mean between the high bid and low
asked quotations for the Common Stock as reported by the National Quotation
Bureau, Incorporated if at least two securities dealers have inserted both bid
and asked quotations for Common Stock on at least five of the ten preceding
days.
(k) "Incentive Stock Option" shall mean an incentive stock option as
defined in Section 422 of the Code.
(l) "Non-Employee Director" shall mean a member of the Board who is
not an employee of the Company or a Subsidiary.
(m) "Non-Statutory Stock Option" shall mean an Option which is not an
Incentive Stock Option.
(n) "Officer" shall mean the Company's president, principal financial
officer, principal accounting officer (or, if there is no such accounting
officer, the controller), any vice-president of the Company in charge of a
principal business unit, division or function (such as sales,
administration or finance), any other officer who performs a policy-making
function, or any other person who performs similar policy-making functions
for the Company. Officers of Subsidiaries shall be deemed Officers of the
Company if they perform such policy-making functions for the Company. As
used in this paragraph, the phrase "policy-making function" does not
include policy-making functions that are not significant. Unless specified
otherwise in a resolution by the Board, an "executive officer" pursuant to
Item 401(b) of Regulation S-K (17 C.F.R. sec. 229.401(b)) shall be only
such person designated as an "Officer" pursuant to the foregoing provisions
of this paragraph.
(o) "Option" (when capitalized) shall mean any option granted under
this Plan.
(p) "Optionee" shall mean a person to whom a stock option is granted
under this Plan or any person who succeeds to the rights of such person
under this Plan by reason of the death of such person.
(q) "Plan" shall mean this Stock Option Plan for the Company.
(r) "Securities Exchange Act" shall mean the Securities Exchange Act
of 1934, as amended.
(s) "Share(s)" shall mean a share or shares of the Common Stock.
(t) "Subsidiary" shall mean any corporation (other than the Company)
in any unbroken chain of corporations beginning with the Company if, at the
time of the granting of the Option, each of the corporations other than the
last corporation in the unbroken chain owns stock possessing 50 percent or
more of the total combined voting power of all classes of stock in one of
the other corporations in such chain.
3. Shares and Options. The Company may grant to Optionees from time to
time Options to purchase an aggregate of up to 2,500,000 Shares from authorized
and unissued Shares. If any Option granted under the Plan shall terminate,
expire, or be canceled or surrendered as to any Shares, new Options may
thereafter be granted covering such Shares. Subject to the provisions of Section
14 hereof, an Option granted hereunder shall be either an Incentive Stock Option
or a Non-Statutory Stock Option as determined by the Committee at the time of
grant of such Option and shall clearly state whether it is an Incentive Stock
Option or Non-Statutory Stock Option. All Incentive Stock Options shall be
granted within 10 years from the effective date of this Plan.
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4. Dollar Limitation. Options otherwise qualifying as Incentive Stock
Options hereunder will not be treated as Incentive Stock Options to the extent
that the aggregate Fair Market Value (determined at the time the Option is
granted) of the Shares, with respect to which Options meeting the requirements
of Code Section 422(b) are exercisable for the first time by any individual
during any calendar year (under all plans of the Company and any Subsidiary),
exceeds $100,000.
5. Conditions for Grant of Options.
(a) Each Option shall be evidenced by an option agreement that may
contain any term deemed necessary or desirable by the Committee, provided
such terms are not inconsistent with this Plan or any applicable law. In
addition to Non-Employee Directors (who shall receive Options only pursuant
to Section 15 of this Plan), Optionees shall be those persons selected by
the Committee from the class of all regular employees of the Company or its
Subsidiaries, including Employee Directors and Officers who are regular
employees of the Company. Any person who files with the Committee, in a
form satisfactory to the Committee, a written waiver of eligibility to
receive any Option under this Plan shall not be eligible to receive any
Option under this Plan for the duration of such waiver.
(b) In granting Options to employees of the Company or its
Subsidiaries, the Committee shall take into consideration the contribution
the person has made to the success of the Company or its Subsidiaries and
such other factors as the Committee shall determine. The Committee shall
also have the authority to consult with and receive recommendations from
officers and other personnel of the Company and its Subsidiaries with
regard to these matters. The Committee may from time to time in granting
Options to employees of the Company or its Subsidiaries under the Plan
prescribe such other terms and conditions concerning such Options as it
deems appropriate, including, without limitation, (i) prescribing the date
or dates on which the Option becomes exercisable, (ii) providing that the
Option rights accrue or become exercisable in installments over a period of
years, or upon the attainment of stated goals or both, or (iii) relating an
Option to the continued employment of the Optionee for a specified period
of time, provided that such terms and conditions are not more favorable to
an Optionee than those expressly permitted herein.
(c) The Options granted to employees under this Plan shall be in
addition to regular salaries, pension, life insurance or other benefits
related to their employment with the Company or its Subsidiaries. Neither
the Plan nor any Option granted under the Plan shall confer upon any person
any right to employment or continuance of employment by the Company or its
Subsidiaries.
(d) Notwithstanding any other provision of this Plan, and in addition
to any other requirements of this Plan, Options may not be granted to (i)
an Officer or Employee Director unless the grant of such Options is
authorized by, and all of the terms of such Options are determined by, a
Committee that is appointed in accordance with Section 13 of this Plan and
all of whose members are Disinterested Persons, or (ii) a Non-Employee
Director unless the grant of such Options is made in accordance with
Section 15 of this Plan.
(e) Notwithstanding any other provision of this Plan, and in addition
to any other requirements of this Plan, the aggregate number of Options
granted to any one Director, Officer or employee may not exceed 40% of the
total number of options available for grant under the Plan.
6. Option Price. The option price per Share of any Option shall be any
price determined by the Committee but shall not be less than the par value per
Share; provided, however, that in no event shall the option price per Share of
any Incentive Stock Option or Option granted pursuant to Section 15 of this Plan
be less than the Fair Market Value of the Shares underlying such Option on the
date such Option is granted.
7. Exercise of Options. An Option shall be deemed exercised when (i) the
Company has received written notice of such exercise in accordance with the
terms of the Option, (ii) full payment of the aggregate option price of the
Shares as to which the Option is exercised has been made, and (iii) arrangements
that are satisfactory to the Committee in its sole discretion have been made for
the Optionee's payment to the Company of the amount that is necessary for the
Company or Subsidiary employing the Optionee to withhold in accordance with
applicable Federal or state tax withholding requirements. Unless further limited
by the
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Committee in any Option, the option price of any Shares purchased shall be paid
in cash, by certified or official bank check, by money order, with Shares or by
a combination of the above; provided further, however, that the Committee in its
sole discretion may accept a personal check in full or partial payment of any
Shares. If the exercise price is paid in whole or in part with Shares, the value
of the Shares surrendered shall be their Fair Market Value on the date the
Option is exercised. The Company in its sole discretion may, on an individual
basis or pursuant to a general program established in connection with this Plan,
lend money to an Optionee, guarantee a loan to an Optionee, or otherwise assist
an Optionee to obtain the cash necessary to exercise all or a portion of an
Option granted hereunder or to pay any tax liability of the Optionee
attributable to such exercise. If the exercise price is paid in whole or part
with Optionee's promissory note, such note shall (i) provide for full recourse
to the maker, (ii) be collateralized by the pledge of the Shares that the
Optionee purchases upon exercise of such Option, (iii) bear interest at the
prime rate of the Company's principal lender, and (iv) contain such other terms
as the Board in its sole discretion shall reasonably require. No Optionee shall
be deemed to be a holder of any Shares subject to an Option unless and until a
stock certificate or certificates for such Shares are issued to such person(s)
under the terms of this Plan. No adjustment shall be made for dividends
(ordinary or extraordinary, whether in cash, securities or other property) or
distributions or other rights for which the record date is prior to the date
such stock certificate is issued, except as expressly provided in Section 10
hereof.
8. Exercisability of Options. Any Option shall become exercisable in such
amounts, at such intervals and upon such terms as the Committee shall provide in
such Option, except as otherwise provided in this Section 8.
(a) The expiration date of an Option shall be determined by the
Committee at the time of grant, but in no event shall an Option be
exercisable after the expiration of 10 years from the date of grant of the
Option.
(b) Unless otherwise provided in any Option, each outstanding Option
shall become immediately fully exercisable:
(i) if there occurs any transaction (which shall include a series
of transactions occurring within 60 days or occurring pursuant to a
plan), that has the result that shareholders of the Company immediately
before such transaction cease to own at least 51 percent of the voting
stock of the Company or of any entity that results from the
participation of the Company in a reorganization, consolidation, merger,
liquidation or any other form of corporate transaction;
(ii) if the shareholders of the Company shall approve a plan of
merger, consolidation, reorganization, liquidation or dissolution in
which the Company does not survive (unless the approved merger,
consolidation, reorganization, liquidation or dissolution is
subsequently abandoned); or
(iii) if the shareholders of the Company shall approve a plan for
the sale, lease, exchange or other disposition of all or substantially
all the property and assets of the Company (unless such plan is
subsequently abandoned).
(c) Except with respect to an Option granted pursuant to Section 15 of
this Plan, the Committee may in its sole discretion accelerate the date on
which any Option may be exercised and may accelerate the vesting of any
Shares subject to any Option or previously acquired by the exercise of any
Option.
9. Termination of Option Period.
(a) The unexercised portion of any Option, other than an Option
granted pursuant to Section 15 hereof, shall automatically and without
notice terminate and become null and void at the time of the earliest to
occur of the following:
(i) three months after the date on which the Optionee's employment
is terminated for any reason other than by reason of (A) Cause, which,
solely for purposes of this Plan, shall mean the termination of the
Optionee's employment by reason of the Optionee's wilful misconduct or
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negligence, (B) a mental or physical disability as determined by a medical
doctor satisfactory to the Committee, or (C) death;
(ii) immediately upon the termination of the Optionee's employment
for Cause;
(iii) one year after the date on which the Optionee's employment is
terminated by reason of a mental or physical disability (within the
meaning of Code Section 22(e)) as determined by a medical doctor
satisfactory to the Committee; or
(iv) (A) twelve months after the date of termination of the
Optionee's employment by reason of death of the employee, or (B) three
months after the date on which the Optionee shall die if such death
shall occur during the one year period specified in Subsection 9(a)(iii)
hereof.
(b) The Committee in its sole discretion may by giving written notice
("cancellation notice") cancel, effective upon the date of the consummation
of any corporate transaction described in Subsections 8(b)(i), (ii) or
(iii) hereof, any Option that remains unexercised on such date. Such
cancellation notice shall be given a reasonable period of time prior to the
proposed date of such cancellation and may be given either before or after
approval of such corporate transaction.
10. Adjustment of Shares.
(a) If at any time while the Plan is in effect or unexercised Options
are outstanding, there shall be any increase or decrease in the number of
issued and outstanding Shares through the declaration of a stock dividend
or through any recapitalization resulting in a stock split-up, combination
or exchange of Shares, then and in such event:
(i) appropriate adjustment shall be made in the maximum number of
Shares available for grant under the Plan, so that the same percentage
of the Company's issued and outstanding Shares shall continue to be
subject to being so optioned; and
(ii) appropriate adjustment shall be made in the number of Shares
and the exercise price per Share thereof then subject to any outstanding
Option, so that the same percentage of the Company's issued and
outstanding Shares shall remain subject to purchase at the same
aggregate exercise price.
(b) Subject to the specific terms of any Option, the Committee may
change the terms of Options outstanding under this Plan, with respect to
the option price or the number of Shares subject to the Options, or both,
when, in the Committee's sole discretion, such adjustments become
appropriate by reason of a corporate transaction described in Subsections
8(b)(ii) or (iii) hereof.
(c) Except as otherwise expressly provided herein, the issuance by the
Company of shares of its capital stock of any class, or securities
convertible into shares of capital stock of any class, either in connection
with direct sale or upon the exercise of rights or warrants to subscribe
therefor, or upon conversion of shares or obligations of the Company
convertible into such shares or other securities, shall not affect, and no
adjustment by reason thereof shall be made with respect to the number of or
exercise price of Shares then subject to outstanding Options granted under
the Plan.
(d) Without limiting the generality of the foregoing, the existence of
outstanding Options granted under the Plan shall not affect in any manner
the right or power of the Company to make, authorize or consummate (i) any
or all adjustments, recapitalizations, reorganizations or other changes in
the Company's capital structure or its business; (ii) any merger or
consolidation of the Company; (iii) any issue by the Company of debt
securities, or preferred or preference stock that would rank above the
Shares subject to outstanding Options; (iv) the dissolution or liquidation
of the Company; (v) any sale, transfer or assignment of all or any part of
the assets or business of the Company; or (vi) any other corporate act or
proceeding, whether of a similar character or otherwise.
11. Transferability of Options. Each Option shall provide that such Option
shall not be transferable by the Optionee otherwise than by will or the laws of
descent and distribution, and each Option shall be exercisable during the
Optionee's lifetime only by the Optionee.
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12. Issuance of Shares. As a condition of any sale or issuance of Shares
upon exercise of any Option, the Committee may require such agreements or
undertakings, if any, as the Committee may deem necessary or advisable to assure
compliance with any such law or regulation including, but not limited to, the
following:
(i) a representation and warranty by the Optionee to the Company, at
the time any Option is exercised, that he is acquiring the Shares to be
issued to him for investment and not with a view to, or for sale in
connection with, the distribution of any such Shares; and
(ii) a representation, warranty and/or agreement to be bound by any
legends that are, in the opinion of the Committee, necessary or appropriate
to comply with the provisions of any securities law deemed by the Committee
to be applicable to the issuance of the Shares and are endorsed upon the
Share certificates.
13. Administration of the Plan.
(a) The Plan shall be administered by the Committee, which shall
consist of not less than two Directors, each of whom shall be Disinterested
Persons to the extent required by Section 5(d) hereof, provided that the
Committee shall not have any discretion with respect to the grant of
Options to Non-Employee Directors pursuant to Section 15 of this Plan. The
Committee shall have all of the powers of the Board with respect to the
Plan. Any member of the Committee may be removed at any time, with or
without cause, by resolution of the Board and any vacancy occurring in the
membership of the Committee may be filled by appointment by the Board.
(b) The Committee, from time to time, may adopt rules and regulations
for carrying out the purposes of the Plan. The Committee's determinations
and its interpretation and construction of any provision of the Plan shall
be final and conclusive.
(c) Any and all decisions or determinations of the Committee shall be
made either (i) by a majority vote of the members of the Committee at a
meeting or (ii) without a meeting by the unanimous written approval of the
members of the Committee.
14. Incentive Options for 10% Shareholders. Notwithstanding any other
provisions of the Plan to the contrary, an Incentive Stock Option shall not be
granted to any person owning directly or indirectly (through attribution under
Section 424(d) of the Code) at the date of grant, stock possessing more than 10%
of the total combined voting power of all classes of stock of the Company (or of
its subsidiary [as defined in Section 424 of the Code] at the date of grant)
unless the option price of such Option is at least 110% of the Fair Market Value
of the Shares subject to such Option on the date the Option is granted, and such
Option by its terms is not exercisable after the expiration of five years from
the date such Option is granted.
15. Formula Grants to Non-Employee Directors. Each Non-Employee Director
that is not affiliated with any beneficial owner of more than 10% of the
Company's Common Stock will receive on the date of his or her appointment as a
Director, an Option to purchase 5,000 shares of Common Stock, which Option will
become fully exercisable on the first anniversary of its grant. The per share
exercise price of all Options granted to Non-Employee Directors pursuant to this
Section 15 will be equal to the Fair Market Value of the Shares underlying such
Option on the date such Option is granted. The unexercised portion of any Option
granted pursuant to this Section 15 shall become null and void three months
after the date on which such Non-Employee Director ceases to be a Director for
any reason.
16. Interpretation.
(a) The Plan shall be administered and interpreted so that all
Incentive Stock Options granted under the Plan will qualify as Incentive
Stock Options under section 422 of the Code. If any provision of the Plan
should be held invalid for the granting of Incentive Stock Options or
illegal for any reason, such determination shall not affect the remaining
provisions hereof, but instead the Plan shall be construed and enforced as
if such provision had never been included in the Plan.
(b) This Plan shall be governed by the laws of the State of Florida.
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(c) Headings contained in this Plan are for convenience only and shall
in no manner be construed as part of this Plan.
(d) Any reference to the masculine, feminine, or neuter gender shall
be a reference to such other gender as is appropriate.
17. Amendment and Discontinuation of the Plan.
(a) Either the Board or the Committee may from time to time amend the
Plan or any Option; provided, however, that, except to the extent provided
in Section 10, no such amendment may, without approval by the shareholders
of the Company, (i) materially increase the benefits accruing to
participants under the Plan, (ii) materially increase the number of
securities which may be issued under the Plan, or (iii) materially modify
the requirements as to eligibility for participation in the Plan; and
provided further, that, except to the extent provided in Section 9, no
amendment or suspension of the Plan or any Option issued hereunder shall
substantially impair any Option previously granted to any Optionee without
the consent of such Optionee.
(b) Notwithstanding anything herein to the contrary, the provisions of
this Plan which govern the number of Options to be awarded to Non-Employee
Directors, the exercise price per share under each such Option, when and
under what circumstances such Option will be granted and the period within
which each such Option may be exercised, shall not be amended more than
once every six months (even with shareholder approval), other than to
conform to changes to the Code, or the rules promulgated thereunder, and
under the Employee Retirement Income Security Act of 1974, as amended, or
the rules promulgated thereunder, or with rules promulgated by the
Securities and Exchange Commission.
18. Effective Date and Termination Date. The Plan shall be effective upon
the Effective Date and shall terminate on the 10th anniversary of the Effective
Date.