Exhibit 10.53

 

 

 

 

NOVAMED, INC.
AMENDED AND RESTATED
2005 RESTRICTED STOCK PLAN

 

 

 

 

 

 

 

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TABLE OF CONTENTS

    Page    ARTICLE I  ESTABLISHMENT  1    ARTICLE II  DEFINITIONS  1    ARTICLE
III  ADMINISTRATION  5       3.1  Committee Structure and Authority  5   
ARTICLE IV  SHARES SUBJECT TO PLAN  7       4.1  Number of Shares  7       4.2 
Release of Shares  7       4.3  Restrictions on Shares  7       4.4  Stockholder
Rights         4.5  Anti-Dilution  7    ARTICLE V  ELIGIBILITY  8       5.1 
Eligibility  8    ARTICLE VI  [reserved]  8    ARTICLE VII  STOCK AWARDS  8     
 7.1  General  8       7.2  Grant  8       7.3  Terms and Conditions  9   
ARTICLE VIII  PERFORMANCE AWARDS  9       8.1  Performance Conditions  9     
 8.2  Performance Awards Granted to Designated Covered Employees  9       8.3 
Written Determinations  10    ARTICLE IX  CHANGE IN CONTROL PROVISIONS  10     
 9.1  Impact of Event  10       9.2  Definition of Change in Control  11     
 9.3  Change in Control Price  11    ARTICLE X  MISCELLANEOUS  12       10.1 
Amendments and Termination  12       10.2  Unfunded Status of Plan  12     
 10.3  Limits on Transferability  12       10.4  General Provisions  12     
 10.5  Mitigation of Excise Tax  14       10.6  Awards in Substitution for
Awards Granted by Other Entities  14       10.7  Procedure for Adoption  14     
 10.8  Procedure for Withdrawal  14       10.9  Delay  15       10.10  Headings 
15       10.11  Severability  15       10.12  Successors and Assigns  15 
     10.13  Entire Agreement  15 

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NOVAMED, INC.
AMENDED AND RESTATED
2005 RESTRICTED STOCK PLAN

ARTICLE I

ESTABLISHMENT

     In October 2005, NovaMed, Inc. (the “Company”), a Delaware corporation,
originally established the Plan (as defined herein). This Plan was amended and
restated effective December 12, 2006, to modify the anti-dilution provisions set
forth in Section 4.5 herein. The purpose of the Plan is to promote the overall
financial objectives of the Company, its stockholders and its Affiliates by
motivating those persons selected to participate in the Plan to achieve
long-term growth in the stockholder equity in the Company and by retaining the
association of those individuals who are instrumental in achieving this growth.
The Plan was adopted as of October 27, 2005 (the “Effective Date”).

ARTICLE II

DEFINITIONS

     For purposes of the Plan, the following terms are defined as set forth
below:

     “Affiliate” means any individual, corporation, partnership, limited
liability company, association, joint-stock company, trust, unincorporated
association or other entity (other than the Company) that directly, or
indirectly through one or more intermediaries, controls, is controlled by, or is
under common control with, the Company, including, without limitation, any
stockholder of an affiliated group of which the Company is a common parent
corporation as provided in Section 1504 of the Code.

     “Agreement” or “Award Agreement” means, individually or collectively, any
agreement entered into pursuant to the Plan pursuant to which an Award is
granted to a Participant.

     “Award” means a Stock Award.

     “Beneficiary” means the person, persons, trust or trusts which have been
designated by a Participant in his or her most recent written beneficiary
designation filed with the Committee to receive the benefits specified under the
Plan upon such Participant’s death or to which Awards are transferred if and to
the extent permitted hereunder. If, upon a Participant’s death, there is no
designated Beneficiary or surviving designated Beneficiary, then the term
Beneficiary means person, persons, trust or trust entitled by will or the laws
of descent and distribution to receive such benefits.

     “Board of Directors” or “Board” means the Board of Directors of the
Company.

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     “Cause” means, for purposes of whether and when a Participant has incurred
a Termination of Employment for Cause, any act or omission which permits the
Company or an Affiliate to terminate the Participant’s employment with the
Company or an Affiliate for “cause” as defined in such agreement or arrangement,
or in the event there is no such agreement or arrangement or the agreement or
arrangement does not define the term “cause” or a substantially equivalent term,
then Cause means, unless otherwise defined in the Award Agreement with respect
to the corresponding Award:

           (a) any act or failure to act deemed to constitute cause under the
Company’s or an Affiliate’s established practices, policies or guidelines
applicable to the Participant;

           (b) breach of a covenant made by the Participant in conjunction with
the grant of an Award or the transfer of Shares hereunder;

           (c) the Participant’s gross negligence in the performance of his
duties or material failure or willful refusal to perform his duties;

           (d) the determination by the Committee in the exercise of its
reasonable judgment that Participant has committed an act that (i) negatively
affects the Company’s or Affiliate’s business or reputation or (ii) indicates
alcohol or drug abuse by Participant that adversely affects his performance
hereunder; or

           (e) the determination by the Committee in the exercise of its
reasonable judgment that Participant has committed an act or acts constituting a
felony or other act involving dishonesty, disloyalty or fraud against the
Company or an Affiliate.

     “Change in Control” and “Change in Control Price” have the meanings set
forth in Sections 9.2 and 9.3, respectively.

     “Code” or “Internal Revenue Code” means the Internal Revenue Code of 1986,
as amended, any Treasury Regulations (including proposed regulations) thereunder
and any subsequent Internal Revenue Code.

     “Commission” means the Securities and Exchange Commission or any successor
agency.

     “Committee” means the person or persons appointed to administer the Plan,
as further described herein.

     “Common Stock” means the regular voting common stock, $0.01 par value per
share, of the Company, whether presently or hereafter issued, and any other
stock or security resulting from adjustment thereof as described hereinafter or
the equity of any successor to the Company which is designated for the purposes
of this Plan.

     “Company” means NovaMed, Inc., a Delaware corporation, and includes any
successor or assignee entity or entities into which the Company may be merged,
changed or consolidated; any entity for whose securities the securities of the
Company shall be exchanged; and any assignee of or successor to substantially
all of the assets of the Company.

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     “Covered Employee” means a Participant who is a “covered employee” within
the meaning of Section 162(m) of the Code.

     “Disability” means a mental or physical illness that entitles the
Participant to receive benefits under the long term disability plan of the
Company or an Affiliate, or if the Participant is not covered by such a plan or
the Participant is not an employee of the Company or an Affiliate, a mental or
physical illness that renders a Participant totally and permanently incapable of
performing the Participant’s duties for the Company or an Affiliate.
Notwithstanding the foregoing, a Disability will not qualify under this Plan if
it is the result of (i) a willfully self-inflicted injury or willfully
self-induced sickness; or (ii) an injury or disease contracted, suffered, or
incurred, while participating in a criminal offense. The determination of
Disability will be made by the Committee. The determination of Disability for
purposes of this Plan will not be construed to be an admission of disability for
any other purpose.

     “Effective Date” means October 27, 2005.

     “Exchange Act” means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.

     “Fair Market Value” means, unless otherwise determined by the Committee,
the closing sale price per share reported on a consolidated basis for stock
listed on the principal stock exchange or market on which Common Stock is traded
on the date as of which such value is being determined or, if there is no sale
on that date, then on the last previous day on which a sale was reported.

     “Grant Date” means the date as of which an Award is granted pursuant to the
Plan.

     “NASDAQ” means the Nasdaq Stock Market, including the Nasdaq National
Market.

     “Participant” means a person who satisfies the eligibility conditions of
Article V and to whom an Award has been granted by the Committee under this
Plan, and in the event a Representative is appointed for a Participant or
another person becomes a Representative, then the term “Participant” shall mean
such Representative. The term shall also include a trust for the benefit of the
Participant, a partnership the interest of which is held by or for the benefit
of the Participant, the Participant’s parents, spouse or descendants, or a
custodian under a uniform gifts to minors act or similar statute for the benefit
of the Participant’s descendants, to the extent permitted by the Committee and
not inconsistent with the Rule 16b-3. Notwithstanding the foregoing, the term
“Termination of Employment” shall mean the Termination of Employment of the
person to whom the Award was originally granted.

     “Performance Award” means a right, granted to a Participant under Article
VIII, to receive an Award based upon performance criteria specified by the
Committee.

      “Plan” means the NovaMed, Inc. Amended and Restated 2005 Restricted Stock
Plan, as herein set forth and as may be amended from time to time.

     “Representative” means (a) the person or entity acting as the executor or
administrator of a Participant’s estate pursuant to the last will and testament
of a Participant or pursuant to the laws of the jurisdiction in which the
Participant had the Participant’s primary residence at the date of the
Participant’s death; (b) the person or entity acting as the guardian or
temporary guardian of a Participant; (c) the person or entity which is the
Beneficiary of the Participant upon or following the Participant’s death; or (d)
any person to whom an Award has been transferred with the permission of the
Committee or by operation of law; provided that only one of the foregoing shall
be the Representative at any point in time as determined under applicable law
and recognized by the Committee. Any Representative shall be subject to all
terms and conditions applicable to the Participant.

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     “Retirement” means the Participant’s Termination of Employment after
attaining either the normal retirement age or the early retirement age as
defined in the principal (as determined by the Committee) tax-qualified plan of
the Company or an Affiliate, if the Participant is covered by such plan, and if
the Participant is not covered by such a plan, then age 65, or age 55 with the
accrual of 10 years of service.

     “Rule 16b-3” means Rule 16b-3, as from time to time in effect and
applicable to the Plan and Participants, promulgated by the Securities and
Exchange Commission under Section 16 of the Exchange Act.

     “Securities Act” means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.

     “Shares” means shares of Common Stock.

     “Stock Award” means an Award denominated in Shares.

     “Termination of Employment” means the occurrence of any act or event,
whether pursuant to an employment agreement or otherwise, that actually or
effectively causes or results in the person’s ceasing, for whatever reason, to
be an officer, independent contractor, board member, consultant, director or
employee of the Company or of any Affiliate, or to be an officer, independent
contractor, board member, consultant, director or employee of any entity that
provides services to the Company or an Affiliate, including, without limitation,
death, Disability, dismissal, severance at the election of the Participant,
Retirement, or severance as a result of the discontinuance, liquidation, sale or
transfer by the Company or its Affiliates of all businesses owned or operated by
the Company or its Affiliates. With respect to any person who is not an employee
with respect to the Company or an Affiliate, the Agreement will establish what
act or event shall constitute a Termination of Employment for purposes of the
Plan. A transfer of employment from the Company to an Affiliate, or from an
Affiliate to the Company, shall not be a Termination of Employment, unless
expressly determined by the Committee. A Termination of Employment shall occur
for an employee who is employed by an Affiliate if the Affiliate shall cease to
be an Affiliate and the Participant does not immediately thereafter become an
employee of the Company or an Affiliate.

     “Voluntary Termination of Employment” means a Termination of Employment at
the election of the Participant, including, with limitation, resignation by the
Participant, but excluding Retirement.

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     In addition, certain other terms used herein have definitions given to them
in the first place in which they are used.

ARTICLE III

ADMINISTRATION

     3.1 Committee Structure and Authority. The Plan shall be administered by
the Committee, which shall be composed of two or more members of the Board of
Directors, each of whom is a “non-employee director” within the meaning of Rule
16b-3 of the Exchange Act and an “outside director” for purposes of the
deduction of compensation under Section 162(m) of the Code. The Committee shall
be the Compensation Committee of the Board of Directors, unless such committee
does not exist or the Board establishes a committee whose purpose is the
administration of this Plan. A majority of the Committee shall constitute a
quorum at any meeting thereof (including by telephone conference) and the acts
of a majority of the members present, or acts approved in writing by a majority
of the entire Committee without a meeting, shall be the acts of the Committee
for purposes of this Plan. The Committee may authorize any one or more of its
stockholders or an officer of the Company to execute and deliver documents on
behalf of the Committee. A member of the Committee shall not exercise any
discretion respecting himself or herself under the Plan. In the event that the
Compensation Committee of the Board no longer is the Committee, the Board shall
have the authority to remove, replace or fill any vacancy of any member of the
Committee upon notice to the Committee and the affected member. Any member of
the Committee may resign upon notice to the Board. The Committee may allocate
among one or more of its members, or may delegate to one or more of its agents,
such duties and responsibilities as it determines.

     Among other things, the Committee shall have the authority, subject to the
terms of the Plan:

          (a) to select those persons to whom Awards may be granted from time to
time;

          (b) to determine whether and to what extent Awards are to be granted
hereunder;

          (c) to determine the number of Shares to be covered by each Award
granted hereunder;

          (d) to determine the terms and conditions of any Award granted
hereunder (including, but not limited to, any restriction, limitation,
acceleration, forfeiture or waiver regarding any Award and the Shares relating
thereto);

          (e) to adjust the terms and conditions, at any time or from time to
time, of any Award, subject to the limitations of Section 10.1;

          (f) to determine under what circumstances an Award may be settled in
cash or Shares;

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          (g) to provide for the forms of Agreement to be utilized in connection
with the Plan;

          (h) to determine whether a Participant has a Disability or a
Retirement;

          (i) to determine whether and with what effect an individual has
incurred a Termination of Employment;

          (j) to determine what securities law requirements are applicable to
the Plan, Awards, and the issuance of Shares and to require of a Participant
that appropriate action be taken with respect to such requirements;

          (k) to cancel, with the consent of the Participant or as otherwise
provided in the Plan or an Agreement, outstanding Awards;

          (l) to interpret and make final determinations with respect to the
remaining number of Shares available under this Plan;

          (m) to require as a condition of the issuance or transfer of a
certificate for Shares, the withholding from a Participant of the amount of any
federal, state or local taxes as may be required by law;

          (n) to determine whether the Company or any other person has a right
or obligation to purchase Shares from a Participant and, if so, the terms and
conditions on which such Shares are to be purchased;

          (o) to determine the restrictions or limitations on the transfer of
Shares;

          (p) to determine whether an Award is to be adjusted, modified or
purchased under the Plan or the terms of an Agreement;

          (q) [reserved];

          (r) to adopt, amend and rescind such rules and regulations as, in its
opinion, may be advisable in the administration of the Plan; and

          (s) to appoint and compensate agents, counsel, auditors or other
specialists to aid it in the discharge of its duties.

     The Committee shall have the authority to adopt, alter and repeal such
administrative rules, guidelines and practices governing the Plan as it shall,
from time to time, deem advisable, to interpret the terms and provisions of the
Plan and any Award issued under the Plan (and any Agreement) and to otherwise
supervise the administration of the Plan. The Committee’s policies and
procedures may differ with respect to Awards granted at different times or to
different Participants.

     Any determination made by the Committee pursuant to the provisions of the
Plan shall be made in its sole discretion, and in the case of any determination
relating to an Award, may be made at the time of the grant of the Award or,
unless in contravention of any express term of the Plan or an Agreement, at any
time thereafter. All decisions made by the Committee pursuant to the provisions
of the Plan shall be final and binding on all persons, including the Company and
Participants. No determination shall be subject to de novo review if challenged
in court.

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ARTICLE IV

SHARES SUBJECT TO PLAN

     4.1 Number of Shares. Subject to adjustment under Section 4.5, the total
number of Shares reserved and available for distribution pursuant to Awards
under the Plan shall be 250,000 Shares, as authorized for issuance on the
Effective Date and thereafter from time to time. Such Shares may consist, in
whole or in part, of authorized and unissued Shares or shares of treasury stock.
Subject to adjustment under Section 4.5, the maximum number of Shares that may
be covered by Awards, in the aggregate, granted to any one Participant during
any calendar year shall be 250,000 Shares.

     4.2 Release of Shares. If any Shares that are subject to any Award are
forfeited, if any Award otherwise terminates without issuance of Shares being
made to the Participant, or if any Shares are received by the Company in
connection with the satisfaction of a tax withholding obligation, such Shares,
will not again be available for distribution in connection with Awards under the
Plan.

     4.3 Restrictions on Shares. Shares issued under the Plan shall be subject
to the terms and conditions specified herein and to such other terms, conditions
and restrictions as the Committee in its discretion may determine or provide in
an Award Agreement. The Company shall not be required to issue or deliver any
certificates for Shares, cash or other property prior to: (i) the Participant
executing any agreement that the Committee has required the Participant to
execute as a condition for the grant of Shares; (ii) the listing of such shares
on any stock exchange or NASDAQ (or other public market) on which the Shares may
then be listed (or regularly traded), (iii) the completion of any registration
or qualification of such Shares under federal or state law, or any ruling or
regulation of any government body which the Committee determines to be necessary
or advisable, and (iv) the satisfaction of any applicable withholding
obligation. The Company may cause any certificate for any Shares to be delivered
to be properly marked with a legend or other notation reflecting the limitations
on transfer of such Shares as provided in this Plan or as the Committee may
otherwise require. The Committee may require a Participant to make such
representations and furnish such information as it may consider appropriate in
connection with the issuance or delivery of the Shares in compliance with
applicable law or otherwise. Fractional shares shall not be delivered, but shall
be rounded to the next lower whole number of shares.

     4.4 [Reserved]

     4.5 Anti-Dilution. In the event of any Company stock dividend, stock split,
reverse stock split, combination or exchange of shares, recapitalization or
other change in the capital structure of the Company, corporate separation or
division of the Company (including, but not limited to, a split-up, spin-off,
split-off or distribution to Company stockholders other than a normal cash than
dividend), sale by the Company of all or a substantial portion of its assets
(measured either on a stand-alone or consolidated basis), reorganization, rights
offering, a partial or complete liquidation, or any other corporate transaction
or event involving the Company and having an effect similar to any of the
foregoing, then the Committee shall adjust or substitute, as the case may be,
the number of Shares available for Awards under the Plan, the number of Shares
covered by outstanding Awards, the exercise price per Share of outstanding
Options, and any other characteristics or terms of the Awards as the Committee
shall deem necessary or appropriate to reflect equitably the effects of such
changes to the Participants; provided, however, that the Committee may limit any
such adjustment so as to maintain the deductibility of the Awards under Section
162(m) of the Code, and that any fractional shares resulting from such
adjustment shall be eliminated by rounding to the next lower whole number of
shares with appropriate payment for such fractional share as shall reasonably be
determined by the Committee.

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ARTICLE V

ELIGIBILITY

     5.1 Eligibility. Only Thomas S. Hall shall be eligible to participate in
the Plan and be granted Awards thereunder.

ARTICLE VI

[reserved]

 

ARTICLE VII

STOCK AWARDS

     7.1 General. The Committee shall have authority to grant Stock Awards under
the Plan at any time or from time to time. Stock Awards may be directly issued
under the Plan subject to such terms, conditions, performance requirements,
restrictions, forfeiture provisions, contingencies and limitations as the
Committee shall determine. Stock Awards may be issued that are fully and
immediately vested upon issuance or that vest in one or more installments over
the Participant’s period of employment or other service to the Company or upon
the attainment of specified performance objectives, or the Company may issue
Stock Awards that entitle the Participant to receive a specified number of
vested Shares upon the attainment of one or more performance goals or service
requirements established by the Committee.

     7.2 Grant. The grant of a Stock Award shall occur as of the date the
Committee determines. Each Stock Award granted under the Plan shall be evidenced
by an Agreement, in a form approved by the Committee, which shall embody the
terms and conditions of such Stock Award and which shall be subject to the
express terms and conditions set forth in the Plan. Such Agreement shall become
effective upon execution by the Company and the Participant. Shares representing
a Stock Award shall be evidenced in such manner as the Committee may deem
appropriate, including book-entry registration on issuance of one or more
certificates (which may bear appropriate legends referring to the terms,
conditions and restrictions applicable to such Award). The Committee may require
that any such certificates be held in custody by the Company until any
restrictions thereon shall have lapsed and that the Participant deliver a stock
power, endorsed in blank, relating to the Shares covered by such Award.

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      7.3 Terms and Conditions. A Stock Award may be issued in exchange for any
consideration which the Committee may deem appropriate in each individual
instance, including, without limitation: (i) cash or cash equivalents; (ii) past
services rendered to the Company or any Affiliate; or (iii) future services to
be rendered to the Company or any Affiliate. A Stock Award that is subject to
restrictions on transfer and/or forfeiture provisions may be referred to as an
award of “Restricted Stock.”

ARTICLE VIII

PERFORMANCE AWARDS

     8.1 Performance Conditions. The right of a Participant to exercise or
receive a grant or settlement of any Award, and its timing, may be subject to
performance conditions specified by the Committee. The Committee may use
business criteria and other measures of performance it deems appropriate in
establishing any performance conditions, and may exercise its discretion to
reduce or increase amounts payable under any Award subject to performance
conditions, except as limited under Sections 8.2 and 8.3 hereof in the case of a
Performance Award intended to qualify under Section 162(m) of the Code.

     8.2 Performance Awards Granted to Designated Covered Employees. If the
Committee determines that a Performance Award to be granted to a person the
Committee regards as likely to be a Covered Employee should qualify as
“performance-based compensation” for purposes of Section 162(m) of the Code, the
grant and/or settlement of such Performance Award shall be contingent upon
achievement of pre-established performance goals and other terms set forth in
this Section 8.2.

          (a) Performance Goals Generally. The performance goals for such
Performance Awards shall consist of one or more business criteria and a targeted
level or levels of performance with respect to such criteria, as specified by
the Committee consistent with this Section 8.2. Performance goals shall be
objective and shall otherwise meet the requirements of Section 162(m) of the
Code, including the requirement that the level or levels of performance targeted
by the Committee result in the performance goals being “substantially
uncertain.” At the time the performance goals are established, the Committee may
determine that more than one performance goal must be achieved as a condition to
settlement of such Performance Awards. Performance goals may differ for
Performance Awards granted to any one Participant or to different Participants.

          (b) Business Criteria. One or more of the following business criteria
for the Company, on a consolidated basis, and/or for specified subsidiaries or
business units of the Company (except with respect to the total stockholder
return and earnings per share criteria), shall be used exclusively by the
Committee in establishing performance goals for such Performance Awards: (1)
total stockholder return; (2) such total stockholder return as compared to total
return (on a comparable basis) of a publicly available index; (3) net income;
(4) pre-tax earnings; (5) EBITDA; (6) pre-tax operating earnings after interest
expense and before business and extraordinary or special items; (7) operating
margin; (8) earnings per share; (9) return on equity; (10) return on capital;
(11) return on investment; (12) operating income; (13) earnings per share; (14)
working capital; and (15) total revenues.

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          (c) Performance Period; Timing for Established Performance Goals.
Achievement of performance goals in respect of such Performance Awards shall be
measured over such periods as may be specified by the Committee. Performance
goals shall be established on or before the dates that are required or permitted
for “performance-based compensation” under Section 162(m) of the Code.

          (d) Settlement of Performance Awards; Other Terms. Settlement of
Performance Awards may be in cash or Shares, or other Awards, or other property,
in the discretion of the Committee. The Committee may, in its discretion, reduce
the amount of a settlement otherwise to be made in connection with such
Performance Awards, but may not exercise discretion to increase any such amount
payable in respect of a Performance Award subject to this Section 8.2. The
Committee shall specify the circumstances in which such Performance Awards shall
be forfeited or paid in the event of a termination of employment or a Change in
Control prior to the end of a performance period or settlement of Performance
Awards, and other terms relating to such Performance Awards.

     8.3 Written Determinations. All determinations by the Committee as to the
establishment of performance goals and the potential Performance Awards related
to such performance goal and as to the achievement of performance goals relating
to such Awards, shall be made in writing in the case of any Award intended to
qualify under Section 162(m) of the Code. The Committee may not delegate any
responsibility relating to such Performance Awards.

ARTICLE IX

CHANGE IN CONTROL PROVISIONS

     9.1 Impact of Event. An Agreement may provide that in the event of a Change
in Control (as defined in Section 9.2):

            (a) [reserved].

          (b) All restrictions applicable to any outstanding Stock Awards shall
be removed, the effect of which shall be that the Shares relating to such Awards
shall become fully vested and transferable.

          (c) Outstanding Awards shall be subject to any agreement of merger or
reorganization that effects such Change in Control, which agreement shall
provide for:

               (i) The continuation of outstanding Awards by the Company, if the
Company is a surviving corporation;

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               (ii) The assumption of outstanding Awards by the surviving
corporation or its parent or subsidiary;

                         (iii) The substitution by the surviving corporation or
its parent or subsidiary of equivalent awards for the outstanding Awards; or

                         (iv) Settlement of each Share subject to an outstanding
Award for the Change in Control Price (less, to the extent applicable, the per
share exercise price), or, if the per share exercise price equals or exceeds the
Change in Control Price, the outstanding Award shall terminate and be canceled.

          (d) In the absence of any agreement of merger or reorganization
effecting such Change in Control, each Share subject to an outstanding Award
shall be settled for the Change in Control Price (less, to the extent
applicable, the per share exercise price), or, if the per share exercise price
equals or exceeds the Change in Control Price, the outstanding Award shall
terminate and be canceled.

     9.2 Definition of Change in Control. For purposes of this Plan, unless
otherwise specified in the Agreement with respect to the corresponding Award, a
“Change in Control” shall be deemed to have occurred if (a) any corporation,
person or other entity (other than the Company, a majority-owned subsidiary of
the Company or any of its subsidiaries, or an employee benefit plan (or related
trust) sponsored or maintained by the Company or an Affiliate), including a
“group” as defined in Section 13(d)(3) of the Securities Exchange Act of 1934,
as amended, becomes the beneficial owner of Shares representing more than fifty
percent of the combined voting power of the Company’s then outstanding
securities; (b)(i) the Company approves, in any transaction or series of related
transactions, a definitive agreement to merge or consolidate the Company with or
into another entity other than a majority-owned subsidiary of the Company, or to
sell or otherwise dispose of all or substantially all of the Company’s assets,
and (ii) the persons who were the members of the Board of Directors prior to
such approval do not represent a majority of the Board of Directors of the
surviving, resulting or acquiring entity or the parent thereof; or (c) the
stockholders of the Company approve a plan of liquidation of the Company.

     9.3 Change in Control Price. For purposes of the Plan, unless otherwise
specified in the Agreement with respect to the corresponding Award, “Change in
Control Price” means the higher of (a) the highest reported sales price of a
Share in any transaction reported on the principal exchange on which such Shares
are listed or on NASDAQ during the sixty (60)-day period prior to and including
the date of a Change in Control or (b) if the Change in Control is the result of
a tender or exchange offer, merger, consolidation, liquidation or sale of all or
substantially all of the assets of the Company (in each case a “Transaction”),
the highest price per Share paid in such Transaction. To the extent that the
consideration paid in any Transaction consists all or in part of securities or
other non-cash consideration, the value of such securities or other non-cash
consideration shall be determined in the sole discretion of the Committee.

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ARTICLE X

MISCELLANEOUS

     10.1 Amendments and Termination. The Board may amend, alter or discontinue
the Plan at any time, but no amendment, alteration or discontinuation shall be
made which would impair the rights of a Participant under an Award theretofore
granted without the Participant’s consent, except such an amendment (a) made to
avoid an expense charge to the Company or an Affiliate, (b) made to cause the
Plan to qualify for the exemption provided by Rule 16b-3 or (c) made to permit
the Company or an Affiliate a deduction under the Code. In addition, no such
amendment shall be made without the approval of the Company’s stockholders to
the extent such approval is required by law or agreement.

     The Committee may amend, alter or discontinue the Plan or an Award at any
time on the same conditions and limitations (and exceptions to limitations) as
apply to the Board’s authority to amend the Plan and further subject to any
approval or limitations the Board may impose.

     10.2 Unfunded Status of Plan. It is intended that the Plan be an “unfunded”
plan for incentive and deferred compensation. The Committee may authorize the
creation of trusts or other arrangements to meet the obligations created under
the Plan to deliver Shares or make payments; provided, however, that, unless the
Committee otherwise determines, the existence of such trusts or other
arrangements is consistent with the “unfunded” status of the Plan.

     10.3 Limits on Transferability. Unless otherwise provided in this Plan or
in an Agreement, no Award shall be subject to the claims of Participant’s
creditors and no Award may be sold, transferred, assigned, alienated,
encumbered, hypothecated, gifted, conveyed, pledged or disposed of in any way
other than by will or the laws of descent and distribution or to a
Representative upon the death of the Participant.

     10.4 General Provisions.

          (a) Representation. The Committee may require each person purchasing
or receiving Shares pursuant to an Award to represent to and agree with the
Company in writing that such person is acquiring the Shares without a view to
the distribution thereof. The certificates for such Shares may include any
legend which the Committee deems appropriate to reflect any restrictions on
transfer.

          (b) No Additional Obligation. Nothing contained in the Plan shall
prevent the Company or an Affiliate from adopting other or additional
compensation arrangements for its employees.

          (c) Withholding. No later than the date as of which an amount first
becomes includable in the gross income of the Participant for income tax
purposes with respect to any Award, the Participant shall pay to the Company (or
other entity identified by the Committee), or make arrangements satisfactory to
the Company or other entity identified by the Committee regarding the payment
of, any federal, state, local or foreign taxes of any kind required by law to be
withheld with respect to such amount required in order for the Company or an
Affiliate to obtain a current deduction. Unless otherwise determined by the
Committee, withholding obligations may be settled with Shares, including Shares
that are part of the Award that gives rise to the withholding requirement,
provided that any applicable requirements under Section 16 of the Exchange Act
are satisfied. The obligations of the Company under the Plan will be conditional
on such payment or arrangements, and the Company and its Affiliates will, to the
extent permitted by law, have the right to deduct any such taxes from any
payment otherwise due to the Participant. The obligations of the Company under
the Plan shall be conditional on such payment or arrangements, and the Company
and its Affiliates shall, to the extent permitted by law, have the right to
deduct any such taxes from any payment otherwise due to the Participant.

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          (d) Representative. The Committee shall establish such procedures as
it deems appropriate for a Participant to designate a Representative to whom any
amounts payable in the event of the Participant’s death are to be paid.

          (e) Controlling Law. The Plan and all Awards made and actions taken
thereunder will be governed by and construed in accordance with the laws of the
State of Delaware (other than its law respecting choice of law). The Plan shall
be construed to comply with all applicable law and to avoid liability to the
Company, an Affiliate or a Participant or loss of a deduction, including,
without limitation, liability under Section 16(b) of the Exchange Act.

          (f) Offset. Any amounts owed to the Company or an Affiliate by the
Participant of whatever nature may be offset by the Company from the value of
any Shares, cash or other thing of value under this Plan or an Agreement to be
transferred to the Participant, and no Shares, cash or other thing of value
under this Plan or an Agreement shall be transferred unless and until all
disputes between the Company and the Participant have been fully and finally
resolved and the Participant has waived all claims to such against the Company
or an Affiliate.

          (g) No Rights with Respect to Continuance of Employment. Nothing
contained herein shall be deemed to alter the relationship between the Company
or an Affiliate and a Participant, or the contractual relationship between a
Participant and the Company or an Affiliate if there is a written contract
regarding such relationship. Nothing contained herein shall be construed to
constitute a contract of employment between the Company or an Affiliate and a
Participant. The Company or an Affiliate and each of the Participants continue
to have the right to terminate the employment or service relationship at any
time for any reason, except as provided in a written contract. The Company or an
Affiliate shall have no obligation to retain the Participant in its employ or
service as a result of this Plan. There shall be no inference as to the length
of employment or service hereby, and the Company or an Affiliate reserves the
same rights to terminate the Participant’s employment or service as existed
prior to the individual’s becoming a Participant in this Plan.

          (h) Fail-Safe. With respect to persons subject to Section 16 of the
Exchange Act, transactions under this Plan are intended to comply with all
applicable conditions of Rule 16b-3, as applicable. To the extent any provision
of the Plan or action by the Committee fails to so comply, it shall be deemed
null and void, to the extent permitted by law and deemed advisable by the
Committee. Moreover, in the event the Plan does not include a provision required
by Rule 16b-3 to be stated herein, such provision shall be deemed to be
incorporated by reference into the Plan with respect to Participants subject to
Section 16.

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     (i) Right to Capitalize. The grant of an Award shall in no way affect the
right of the Company to adjust, reclassify, reorganize or otherwise change its
capital or business structure or to merge, consolidation, dissolve, liquidate or
sell or transfer all or any part of its business or assets.

       10.5 Mitigation of Excise Tax. Subject to any agreement with a
Participant, if any payment or right accruing to a Participant under this Plan
(without the application of this Section 10.5), either alone or together with
other payments or rights accruing to the Participant from the Company or an
Affiliate (“Total Payments”), would constitute a “parachute payment” (as defined
in Section 280G of the Code and regulations thereunder), such payment or right
shall be reduced to the largest amount or greatest right that will result in no
portion of the amount payable or right accruing under the Plan being subject to
an excise tax under Section 4999 of the Code or being disallowed as a deduction
under Section 280G of the Code. The determination of whether any reduction in
the rights or payments under this Plan is to apply shall be made by the
Committee in good faith after consultation with the Participant, and such
determination will be conclusive and binding on the Participant. The Participant
shall cooperate in good faith with the Committee in making such determination
and providing the necessary information for this purpose. The provisions of this
Section 10.5 shall apply with respect to any Participant only if, after
reduction for any applicable federal excise tax imposed by Section 4999 of the
Code and other federal income tax imposed by the Code, the Total Payments
accruing to such Participant would be less than the amount of the Total Payments
as reduced (i) if applicable, pursuant to the provisions of this Section 10.5
and any similar provisions under any other plan of the Company or any Affiliate
to mitigate the applicable federal excise tax, and (ii) by federal income taxes
(other than such excise tax).

       10.6 Awards in Substitution for Awards Granted by Other Entities. Awards
may be granted under the Plan from time to time in substitution for awards held
by employees, directors or service providers of other entities who are about to
become officers, directors, stockholders or employees of the Company or an
Affiliate. The terms and conditions of the Awards so granted may vary from the
terms and conditions set forth in this Plan at the time of such grant as the
majority of the stockholders of the Committee may deem appropriate to conform,
in whole or in part, to the provisions of the Awards in substitution for which
they are granted.

       10.7 Procedure for Adoption. Any Affiliate of the Company may by
resolution of such Affiliate’s board of directors with the consent of the Board
of Directors and subject to such conditions as may be imposed by the Board of
Directors, adopt the Plan for the benefit of its employees as of the date
specified in the resolution.

       10.8 Procedure for Withdrawal. Any Affiliate which has adopted the Plan
may, by resolution of the board of directors of such Affiliate, with the consent
of the Board of Directors and subject to such conditions as may be imposed by
the Board of Directors, terminate its adoption of the Plan.

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       10.9 Delay. If at the time a Participant incurs a Termination of
Employment (other than due to Cause) or if at the time of a Change in Control,
the Participant is subject to “short-swing” liability under Section 16 of the
Exchange Act, any time period provided for under the Plan or an Agreement to the
extent necessary to avoid the imposition of liability will be suspended and
delayed during the period the Participant would be subject to such liability,
but not more than six months and one day. The Company shall have the right to
suspend or delay any time period described in the Plan or an Agreement if the
Committee shall determine that the action may constitute a violation of any law
or result in liability under any law to the Company, an Affiliate or a
shareholder in the Company until such time as the action required or permitted
will not constitute a violation of law or result in liability to the Company, an
Affiliate or a shareholder of the Company. The Committee shall have the
discretion to suspend the application of the provisions of the Plan required
solely to comply with Rule 16b-3 if the Committee determines that Rule 16b-3
does not apply to the Plan.

       10.10 Headings. The headings contained in this Plan are for reference
purposes only and shall not affect the meaning or interpretation of this Plan.

       10.11 Severability. If any provision of this Plan is for any reason held
to be invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision of this Plan, and this Plan will be construed as if
such invalid or unenforceable provision were omitted.

       10.12 Successors and Assigns. This Plan shall inure to the benefit of and
be binding upon each successor and assign of the Company. All obligations
imposed upon a Participant, and all rights granted to the Company hereunder,
shall be binding upon the Participant’s heirs, legal representatives and
successors.

       10.13 Entire Agreement. This Plan and the Agreement constitute the entire
agreement with respect to the subject matter hereof and thereof, provided that
in the event of any inconsistency between the Plan and the Agreement, the terms
and conditions of this Plan shall control.

       Executed effective as of the 12th day of December, 2006.

NovaMed, Inc.  By: /s/ Scott T. Macomber     Its: EVP and CFO 

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