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EXHIBIT 10.26
1996 NON-QUALIFIED EMPLOYEE STOCK PURCHASE PLAN
1. EFFECTIVE DATE AND PURPOSE OF THE PLAN
The effective date of the Pediatrix Medical Group 1996 Non-Qualified
Employee Stock Purchase Plan (the "Plan") is April 1, 1996.
The purpose of the Plan is to encourage ownership of Pediatrix Medical
Group Common Stock by eligible employees of the Company, thereby enhancing
employee interest in the continued success and progress of Pediatrix Medical
Group, Inc. The Plan provides employees the opportunity to invest in such stock
at a discounted price through payroll deductions.
2. DEFINITIONS
For purposes of this Plan, the following terms used in this document have
the meanings as defined below:
"Account" -- a separate account maintained by the Custodian for each
Participant which reflects the number of shares of Common Stock purchased
under the Plan by such Participant.
"Agent and recordkeeper" -- Dean Witter Trust Company.
"Business Day" -- a day on which there is trading on the NASDAQ
exchange.
"Committee" -- the Compensation Committee of the Board of Directors of
Pediatrix.
"Common Stock" -- Pediatrix Medical Group, Inc. common stock, par
value of $.01 per share.
"Company" -- Each of the following companies related to Pediatrix
through long-term management contracts and which provide the medical
component of the services required in respect of any arrangement where
Pediatrix 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 business entity related to Pediatrix in such manner and which adopts
the Plan with the consent of the Board of Directors of Pediatrix.
"Compensation" -- the amount of a Participant's base wages, overtime,
commissions, and cash bonuses, before giving effect to any compensation
reductions made in connection with any plans described in Section 401(k) or
Section 125 of the Code.
"Custodian" -- The Bank of New York.
"Eligible Employee" -- an employee of the Company who is eligible to
participate in the Plan in accordance with Section 3. of this Plan.
"Entry Date" -- the first Business Day of each Purchase Period.
"Exchange Act" -- The Securities Exchange Act of 1934, as amended.
"Fair Market Value" -- the value of a share of Common Stock on any
Business Day shall be the average of the high and low prices of Common
Stock as published in the NASDAQ listing for such day; in the event that
such prices are not published, the Fair Market Value of a share of Common
Stock shall be determined by the Committee.
"Participant" -- each Eligible Employee who has elected to have
amounts deducted from his or her Compensation to participate in this
Employee Stock Purchase Plan.
"Pediatrix" -- Pediatrix Medical Group, Inc., a Florida corporation.
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"Purchase Date" -- the first Business Day after the end of each
Purchase Period on which it is administratively possible to do the
purchase, but no more than five business days after the end of each
Purchase Period.
"Purchase Period" -- each of the six-month periods ending on the last
day of September and March. The initial Purchase Period of the Plan shall
begin on April 1, 1996, and end on September 30, 1996.
"Purchase Price" -- the lesser of: the Fair Market Value of a share of
Common Stock on the Entry Date, less 15%; or the Fair Market Value of a
share of Common Stock on the Purchase Date, less 15%.
3. ELIGIBILITY
Employees are eligible to participate in the Plan if, at the beginning of
the Purchase Period, the employee is regularly scheduled to work at least 20
hours per week and more than five months per year. No employee shall be eligible
to participate in the Plan if, immediately after the Entry Date, the employee
(or any other person whose stock would be attributed to the employee pursuant to
Section 424(d) of the Code) would own stock and/or hold options to purchase
stock possessing 5% or more of the total combined voting power or value of all
classes of stock of Pediatrix or any parent company or subsidiaries thereof. Any
employee eligible to participate in the Pediatrix 1996 Qualified Employee Stock
Purchase Plan is not eligible to participate in this Plan.
4. PARTICIPATION
Participation in the Plan is voluntary. An eligible employee may elect to
participate by completing an enrollment form and returning it to the Human
Resources Department of Pediatrix. The payroll deductions will start at the
beginning of the next Purchase Period. The completed enrollment form must be
received by the Human Resources Department of Pediatrix no later than 15 days
prior to the beginning of a Purchase Period.
Purchase Periods begin on April 1 and October 1 of each year so long as the
Plan remains in effect. Once an employee enrolls, he/she will automatically
continue participation in subsequent Purchase Periods on the same basis, unless
he/she elects to change deduction amounts, withdraw, or becomes ineligible.
5. COMMON STOCK AVAILABLE UNDER THE PLAN
The maximum number of shares of Common Stock which may be purchased under
the Plan is 500,000, subject to adjustment in the event of any capital change by
reason of any stock dividend or split, recapitalization, merger in which
Pediatrix is the surviving entity, combination or exchange of shares or similar
corporate change. In such an event, the number and type of shares of Pediatrix
which Participants may purchase under the Plan, and the maximum number of shares
which may be purchased under the Plan, will be adjusted, as appropriate, by the
Board of Directors of Pediatrix.
6. PURCHASES OF COMMON STOCK
On the Purchase Date for each Purchase Period, whole and fractional shares
will be purchased for each Participant with the accumulated Participant payroll
deductions. The Purchase Price is the lesser of 85% of the Fair Market Value of
a share of Common Stock on the Entry Date, or 85% of the Fair Market Value of a
share of Common Stock on the Purchase Date of the Purchase Period. Additionally,
commission charges relating to the purchase of Common Stock under the Plan will
be paid by the Company.
7. INVESTING IN THE PLAN
Plan elections for payroll deductions must be in whole percentages or
specific dollar amounts. The minimum percent is 1% of Compensation per pay
period, and the maximum percent is 15%.
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If a Participant elects a specific dollar amount, the minimum is $25 per
pay period. The maximum payroll deduction per Purchase Period is $10,625. Please
see Section 8 for limitations on purchases.
Payroll deductions are accumulated in non-interest bearing accounts until
each Purchase Date.
8. LIMITATION ON PURCHASES
The Fair Market Value of Common Stock that a Participant has the right to
Purchase under the Plan cannot exceed $25,000 in one calendar year. This
limitation is based on calculating the Fair Market Value at the beginning of
each Purchase Period.
9. CHANGING PAYROLL DEDUCTIONS
A Participant's elected payroll deduction may be increased or decreased
effective with the next Purchase Period. The form must be received by the Human
Resources Department of Pediatrix no later than 15 days prior to the next
Purchase Period. Changes will not become effective during a Purchase Period.
Participants may, however, cease deductions during a Purchase Period. If a
Participant ceases deductions during a Purchase Period the deductions already
taken will be refunded to the Participant as soon as practicable. The
Participant would not be eligible to participate again until the second Purchase
Period after the one in which he/she withdrew. In order to rejoin the Plan, a
new enrollment form must be submitted.
10. RIGHTS AS A STOCKHOLDER
From the initial Purchase Date of shares of Common Stock, and thereafter
(unless and until the Participant sells the Common Stock), the Participant shall
have all the rights and privileges of a stockholder of Pediatrix with respect to
the shares of Common Stock purchased by the Participant.
Proxy information will be provided for each stockholders meeting, so that
each Participant may have his/her full and fractional shares voted according to
their instructions.
11. ACCOUNTS
The Bank of New York has been appointed Custodian for the Plan. The
Custodian will maintain an Account for each Participant. As shares of Common
Stock are purchased at the end of each Purchase Period, each Participant's full
and fractional shares will be held in his/her Account.
Participants will receive an Account Statement, as soon as administratively
possible after the end of each Purchase Period, which will include the number of
full and fractional shares purchased for the Participant at the end of each
Purchase Period, the total number of shares owned by the Participant under the
Plan, the cost per share, and the current value of shares held.
12. NO TRANSFER OF RIGHTS
The rights granted under the Plan may not be assigned or transferred under
any circumstances.
13. ADMINISTRATION
The Plan is administered by the Compensation Committee. The members of the
Compensation Committee are not eligible to participate in the Plan. The
Committee has the authority to interpret the Plan and to establish rules and
regulations for its administration, and the decisions and interpretations of the
Plan by the Committee shall be final, conclusive and binding upon all
Participants. The Committee has the authority to delegate the day-to-day
administration of the Plan.
14. SELLING STOCK
Although the Plan is intended to provide Participants with an ownership
interest in Pediatrix as an investment, Participants may sell shares of Common
Stock purchased under the Plan by completing and
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submitting the appropriate form to the Human Resources Department of Pediatrix.
Additionally, Participants will be responsible for the $15 transaction fee
related to the sale and the $.05 per share commission fee.
Restrictions may apply to the resale of shares of Common Stock by certain
officers of the Company and those having similar responsibilities, who are
subject to the SEC insider reporting and short-swing profit rules.
15. SHAREHOLDER APPROVAL
The Plan shall become effective on April 1, 1996, subject to approval by
the shareholders of Pediatrix. Participation in the Plan may commence on the
effective date, prior to receipt of shareholder approval, provided that, if
shareholder approval is not received prior to the initial Purchase Date, no
shares of Common Stock shall be purchased under the Plan until Participants are
advised of SEC rules regarding the sale of shares. Participants would have the
option to remain in the Plan or have deducted amounts returned. In addition, to
the extent necessary to comply with Rule 16b-3 of the Exchange Act or other
applicable law, the Committee shall obtain approval of the shareholders of
Pediatrix of any Plan amendment in such a manner and to such a degree as
required.
16. AMENDMENTS
The Compensation Committee may at any time, or from time to time, amend the
Plan in any respect, except that, without approval of the shareholders of
Pediatrix, no amendment may be made (a) increasing the number of shares which
may be purchased under the Plan (other than provided in Section 5 herein), (b)
materially increasing the benefits accruing to Participants, or (c) materially
modifying the requirements as to eligibility for participation in the Plan.
17. TERMINATION OF THE PLAN
The Plan and all rights hereunder shall terminate on the earliest of:
- the date on which the maximum number of shares of Common Stock
available for purchase under the Plan has been purchased;
- the termination of the Plan by the Compensation Committee;
- the effective date of any consolidation or merger in which Pediatrix
is not the surviving entity, any exchange or conversion of outstanding
shares of Pediatrix for or into securities of another entity or other
consideration, or any complete liquidation of Pediatrix.
Upon termination of the Plan, any shares in the Participant's account shall
be delivered by the Custodian to the Participant or his/her legal representative
as soon as practicable following such termination.
18. LAWS AND REGULATIONS
Notwithstanding any other provision of the Plan, the rights of Participants
to purchase Common Stock hereunder shall be subject to compliance with all
applicable Federal, state and foreign laws, rules and regulations and the rules
of each stock exchange upon which the Common Stock is from time to time listed.
The Plan and purchase of Common Stock hereunder shall be subject to
additional rules and regulations, not inconsistent with the Plan, that may be
promulgated from time to time by the Committee regarding purchases and sales of
Common Stock.
19. PARTICIPANT RETIREMENT, EMPLOYMENT TERMINATION, OR DEATH
In the event of the Participant's retirement or termination of employment,
any uninvested amount will be refunded to the Participant. Shares held in the
Plan will be distributed in accordance with the Participant's instructions.
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In the event of the Participant's death, dollars and shares in the
Participant's account will be delivered to the beneficiary designated on the
Participant's enrollment form. If none is listed, the dollars and shares will be
delivered to the Participant's estate.
20. EMPLOYMENT
The Plan shall not confer any rights of continued employment upon any
employee of a Company.
21. ADDITIONAL RESTRICTIONS OF RULE 16B-3
Persons subject to Section 16 of the Exchange Act shall comply with the
applicable provisions of Rule 16b-3 of the Exchange Act or any successor
provision. This Plan shall be deemed to contain such additional conditions and
restrictions as may be required by Rule 16b-3 to qualify for the maximum
exemption from Section 16 of the Exchange Act with respect to Plan transactions.
In the event that Rule 16b-3 provides specific requirements for the
administrators of plans of this type, the Plan shall only be administered by
such body and in such a manner as to comply with the applicable requirements of
Rule 16b-3. Unless permitted by Rule 16b-3, no discretion concerning decisions
regarding the Plan shall be afforded to any Committee or person that is not
"disinterested" as that term is used in Rule 16b-3.
22. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION
Subject to any required action by the stockholders of Pediatrix, the number
of shares of Common Stock covered by each option under the Plan which has not
yet been exercised and the number of shares of Common Stock which have been
authorized for issuance under the Plan but have not yet been placed under option
(collectively, the "Reserves"), as well as the price per share of Common Stock
covered by each option under the Plan which has not yet been exercised, shall be
proportionately adjusted for any increase or decrease in the number of issued
shares of Common Stock resulting from a stock split, reverse stock split, stock
dividend, combination or reclassification of the Common Stock, or any other
increase or decrease in the number of shares of Common Stock effected without
receipt of consideration by Pediatrix; provided, however, that conversion of any
convertible securities of Pediatrix shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the
Committee, whose determination in that respect shall be final, binding and
conclusive. Except as expressly provided herein, no issue by Pediatrix of shares
of stock of any class, or securities convertible into shares of stock of any
class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number or price of shares of Common Stock subject to an option.
In the event of the proposed dissolution or liquidation of Pediatrix, the
Purchase Period will terminate immediately prior to the consummation of such
proposed action, unless otherwise provided by the Committee. In the event of a
proposed sale of all or substantially all of the assets of Pediatrix, or the
merger of Pediatrix with or into another corporation, each option under the Plan
shall be assumed or an equivalent option shall be assumed or substituted by such
successor corporation or a parent or subsidiary of such successor corporation,
unless the Committee determines, in the exercise of its sole discretion and in
lieu of such assumption or substitution, that the Participant shall have the
right to exercise the option as to all of the optioned stock, including shares
as to which the option would not otherwise be exercisable. If the Committee
makes an option fully exercisable in lieu of assumption or substitution in the
event of a merger or sale of assets, the Committee shall notify the Participant
that the option shall be fully exercisable for a period of thirty (30) days from
the date of such notice, and the option will terminate upon the expiration of
such period.
The Committee may, if it so determines in the exercise of its sole
discretion, also make provision for adjusting the Reserves, as well as the price
per share of Common Stock covered by each outstanding option, in the event that
Pediatrix effects one or more reorganizations, recapitalization, rights
offerings or other increases or reductions of shares of its outstanding Common
Stock, and in the event of Pediatrix being consolidated with or merged into any
other corporation.