Exhibit 10.4

COMPOSITE DIRECTORS’ STOCK OPTION PLAN1

ARTICLE I

PURPOSE

The purpose of the AMEDISYS, INC. Directors’ Stock Option Plan (the “Plan”) is
to secure for AMEDISYS, INC. and its stockholders the benefits arising from
stock ownership by its Directors. The Plan will provide a means whereby eligible
Directors may purchase shares of the common stock, $.001 par value, of AMEDISYS,
INC. pursuant to options granted in accordance with the Plan.

ARTICLE II

DEFINITIONS

The following capitalized terms used in the Plan shall have the respective
meanings set forth in this Article:

2.1 “Annual Grant Date” shall mean July 1 of each calendar year commencing
July 1, 1998 during the term of the Plan or the nearest preceding business day
if July 1 falls on a weekend or holiday.

2.2 “Board” shall mean the Board of Directors of AMEDISYS, INC.

2.3 “Chairman” shall mean the duly appointed Chairman of any standing Committee
of the Board.

2.4 “Change of Control” shall mean the occurrence of any of the following acts:

(a) The acquisition by any person, entity or “group” within the meaning of
Section 13(d) or 14(d) of the Securities Exchange Act of 1934 (the “Exchange
Act”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of thirty (30%) percent or more of either the then
outstanding shares of the Company’s Common Stock or the combined voting power of
the Company’s then outstanding voting securities entitled to vote generally in
the election of directors; provided, however, the purchase by underwriters in a
firm commitment public offering of the Company’s securities shall not constitute
a Change of Control; or

(b) If the individuals who serve on the Company’s Board as of July 1, 1998 (the
“Incumbent Board”) cease for any reason to constitute at least a majority of the
Board; provided, however, any person who becomes a Director subsequent to
July 1, 1998, whose election or nomination for election by the Company’s
stockholders was approved by a vote of at least a majority of the Directors then
compiling the Incumbent Board, shall for purposes of this Agreement be
considered as if such person was a member of the Incumbent Board; or

(c) Approval by the Company’s stockholders of: (i) a merger, reorganization or
consolidation whereby the Company’s stockholders immediately prior to such
approval do not, immediately after consummation of such reorganization, merger
or consolidation own more than 50% of the combined voting power entitled to vote
generally in the election of directors of the surviving entity’s then
outstanding voting securities; or (ii) liquidation or dissolution of the
Company; or (iii) the sale of all or substantially all of the assets of the
Company.

2.5 “Committee” shall mean a duly appointed standing committee of the Board.

2.6 “Common Stock” shall mean the common stock, $.001 par value of the Company.

2.7 “Company” shall mean Amedisys, Inc. and any of its subsidiaries.

2.8 “Director” shall mean any person who is a member of the Board of the
Company.

2.9 “Eligible Director” shall be any Director who is not a full or part-time
employee of the Company.

 

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1 Encompassing Plan amendments dated June 10, 2004, and the full text of the
Directors Stock Option Plan

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2.10 “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

2.11 “Exercise Price” shall mean the price per share at which an Option may be
exercised.

2.12 “Fair Market Value” shall mean the closing price of a share of Common Stock
on the principal securities exchange on which such Common Stock is traded on the
last preceding business day prior to the date as to which Fair Market Value is
being determined, or on the next preceding business day on which such Common
Stock is traded, if no shares of Common Stock were traded on such date. If the
Common Stock is not traded on a securities exchange, Fair Market Value shall be
the closing sales price of the Common Stock as reported on the NASDAQ-National
Market System for the last preceding business day prior to the date on which
Fair Market Value is to be determined or on the next preceding business day if
the Common Stock was not traded on such date. If the Common Stock is not quoted
on the NASDAQ-National Market System, Fair Market Value shall be the average of
the high bid and low asked prices of the Common Stock in the over-the-counter
market on the last preceding business day prior to the day as of which Fair
Market Value is being determined, or on the next preceding day on which such
high bid and low asked prices were recorded. If the Common Stock is not publicly
traded, Fair Market Value shall be determined by the Board, in good faith, but
only during any period in which no equity security of the Company’s is
registered pursuant to Section 12 of the Exchange Act. In no case shall Fair
Market Value be less than the par value per share of the Common Stock. Fair
market value shall be determined without regard to any restriction other than a
restriction which, by its terms, will never lapse.

2.13 “Grant Date” shall mean the Initial Grant Date or the Annual Grant Date as
appropriate.

2.14 “Initial Grant Date” shall mean with respect to each Eligible Director, the
date such Eligible Director is first elected as a member of the Board.

2.15 “Option” shall mean an Option, including a Reload Option, to purchase
shares granted pursuant to the Plan.

2.16 “Option Agreement” shall mean the written agreement described in Article VI
herein.

2.17 “Permanent Disability” shall mean the condition of an Eligible Director who
is unable to participate as a member of the Board by reason of any medically
determined physical or mental impairment which can be expected to result in
death or which can be expected to last for a continuous period of not less than
twelve (12) months.

2.18 “Purchase Price” shall be the Exercise Price multiplied by the number of
whole shares of Common Stock with respect to which an Option may be exercised.

2.19 “Plan” shall mean this Amedisys, Inc. Directors’ Stock Option Plan.

2.20 “Reload Option” means an option granted to an Eligible Director equal to
the number of shares of Common Stock delivered by the Eligible Director to pay
for the exercise of an Option as more fully described in Article XIII - RELOAD
OPTIONS.

ARTICLE III

ADMINISTRATION

3.1 General. This Plan shall be administered by the Board in accordance with the
express provisions of this Plan, subject to the restrictions contained in
Section 16 of the Exchange Act.

3.2 Powers of the Board. The Board shall have full and complete authority to
adopt such rules and regulations and to make all such other determinations not
inconsistent with the Plan or Section 16 of the Exchange Act (once the Common
Stock is registered pursuant to Section 12 of the Exchange Act), as may be
necessary for the administration of the Plan.

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3.3 Section 16 Compliance. It is the intention of the Company that the Plan, and
the administration of the Plan (once the Company’s Common Stock is registered
pursuant to Section 12 of the Exchange Act) comply in all respects with
Section 16 of the Exchange Act and the rules and regulations promulgated
thereunder. If any Plan provision, or any aspect of the administration of the
Plan, is found not to be in compliance with Section 16 of the Exchange Act, the
provision or administration shall be deemed null and void, and in all events the
Plan shall be construed in favor of its meeting the requirements of Rule 16b-3
promulgated under the Exchange Act.

ARTICLE IV

SHARES SUBJECT TO PLAN

Subject to adjustment in accordance with Articles IX and XII an aggregate of
400,000 shares of Common Stock are reserved for issuance under the Plan. Shares
of Common Stock reserved under this Plan may be either authorized, but unissued
shares of Common Stock or reacquired shares of Common Stock. If an Option, or
any portion thereof, shall expire or terminate for any reason without having
been exercised in full, the unpurchased shares of Common Stock covered by such
Option shall be available for future grants of Options.

ARTICLE V

NON-DISCRETIONARY GRANTS

5.1 Initial Grants. On the Initial Grant Date, each Eligible Director shall
receive, at the discretion of the Board, the grant of an Option to purchase up
to 10,000 shares of Common Stock.

5.2 Annual Grants. On each Annual Grant Date, each Eligible Director shall
receive, at the discretion of the Board, the grant of an Option to purchase up
to 10,000 shares of Common Stock.

ARTICLE VI

TERMS OF OPTION

Each Option shall be evidenced by a written Option Agreement executed by the
Company and the Eligible Director which shall specify the Grant Date, the number
of shares of Common Stock subject to the Option, the Exercise Price and shall
also include or incorporate by reference the substance of all of the following
provisions and such other provisions consistent with this Plan as the Board may
determine:

6.1 Term. The term of the Option shall be ten (10) years from the Grant Date of
each Option, subject to earlier termination in accordance with Articles VI and X
of the Plan.

6.2 Restriction on Exercise. No Option shall be exercisable until six (6) months
after the Grant Date, except in the case of the Eligible Director’s death or
permanent disability, upon which events the Option will become immediately
exercisable. Thereafter, an Option, or any portion thereof, may be exercised
until the earlier of the expiration of the option’s term or termination of the
Option in accordance with this Article VI.

6.3 Exercise Price. The Exercise Price for each share of Common Stock subject to
an Option shall be the Fair Market Value of the Common Stock as determined in
Section 2.12 herein.

6.4 Manner of Exercise. An Option shall be exercised in accordance with its
terms, by delivery of a written notice of exercise to the Company and payment of
the full Purchase Price of the shares of Common Stock being purchased. An
Eligible Director may exercise an Option with respect to all or less than all of
the shares of Common Stock for which the Option may then be exercised, but an
eligible Director must exercise the Option in full shares of Common Stock.

6.5 Payment. The Purchase Price pursuant to an Option or portion thereof, may be
paid:

(a) in United States dollars, in cash or by check, bank draft or money order
payable to the Company; or

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(b) by delivery of shares of Common Stock owned by an Eligible Director which
has an aggregate Fair Market Value on the date of exercise equal to the Purchase
Price, subject to the provisions of Section 16(b) of the Exchange Act; or

(c) to the extent authorized by the Board, or if specified in the Option being
exercised, by a promissory note from optionee to the Company, upon such terms an
conditions determined by the Board and secured by the Common Stock issuable upon
exercise of the Option; or

(d) by any combination of the above methods of payment.

6.6 Transferability. No Option shall be transferable otherwise than by will or
the laws of descent and distribution, and an Option shall be exercisable during
the Eligible Director’s lifetime only by the Eligible Director, his guardian or
legal representative.

6.7 Termination of Membership on the Board. If an Eligible Director’s membership
on the Board terminates for any reason, an Option held on the date of
termination may be exercised in whole or in part at any time within one (1) year
after the date of such termination (but in no event after the actual expiration
of the term of the Option) and shall thereafter terminate.

ARTICLE VII

GOVERNMENT AND OTHER REGULATIONS

7.1 Delivery of Common Stock. The obligation of the Company to issue or transfer
and deliver shares of Common Stock for exercised Options under the Plan shall be
subject to all applicable laws, regulations, rules, orders and approvals which
shall then be in effect.

7.2 Holding of Stock After Exercise of Option. The Option Agreement shall
provide that the Eligible Director, by accepting such option, represents and
agrees, for the Eligible Director and his permitted transferees, that none of
the shares of Common Stock purchased upon exercise of the Option shall be
acquired with a view to any sale, transfer or distribution of the shares in
violation of the Securities Act of 1933, as amended (the “Act”) and the person
exercising an Option shall furnish evidence satisfactory to that Company to that
effect, including an indemnification of the Company in the event of any
violation of the Act by such person.

ARTICLE VIII

WITHHOLDING TAX

The Company may, in its discretion, require an Eligible Director to pay to the
Company, at the time of exercise of an Option an amount that the Company deems
necessary to satisfy its obligations, if any, to withhold federal, state or
local income or other taxes (which for purposes of this Article VIII includes an
Eligible Director’s FICA obligation) incurred by reason of such exercise. When
the exercise of an Option does not give rise to the obligation to withhold
federal income taxes on the date of exercise, the Company may, in its
discretion, require an Eligible Director to place shares of Common Stock
received upon exercise of the Option in escrow for the benefit of the Company
until such time as federal income tax withholding is required on amounts
included in the Eligible Director’s gross income as a result of the exercise of
an Option. At such time, the Company, in its discretion, may require an Eligible
Director to pay to the Company an amount that the Company deems necessary to
satisfy its obligation to withhold federal, state or local taxes incurred by
reason of the exercise of the Option, in which case the shares of Common Stock
will be released from escrow upon such payment by an Eligible Director.

ARTICLE IX

ADJUSTMENTS

9.1 Proportionate Adjustments. If the outstanding shares of Common Stock are
increased, decreased, changed into or exchanged into a different number or kind
of shares of Common Stock or securities of the Company through reorganization,
recapitalization, reclassification, stock dividend, stock split, reverse stock
split or other similar transaction, an appropriate and proportionate adjustment
shall be made to the maximum number and kind of shares of Common Stock as to
which Options may be granted under this Plan. A corresponding adjustment
changing

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the number or kind of shares of Common Stock allocated to unexercised Options or
portions thereof, which shall have been granted prior to any such change, shall
likewise be made. Any such adjustment in the outstanding Options shall be made
without change in the Purchase Price applicable to the unexercised portion of
the Option with a corresponding adjustment in the Exercise Price of the shares
of Common Stock covered by the Option. Notwithstanding the foregoing, there
shall be no adjustment for the issuance of shares of Common Stock on conversion
of notes, preferred stock or exercise of warrants or shares of Common Stock
issued by the Board for such consideration as the Board deems appropriate.

9.2 Dissolution or Liquidation. Upon the dissolution or liquidation of the
Company, or upon a reorganization, merger or consolidation of the Company with
one or more corporations as a result of which the Company is not the surviving
corporation, or upon a sale of substantially all of the property or more than
80% of the then outstanding shares of Common Stock of the Company to another
corporation, the Company shall give to each Eligible Director at the time of
adoption of the plan for liquidation, dissolution, merger or sale either (1) a
reasonable time thereafter within which to exercise the Option prior to the
effective date of such liquidation or dissolution, merger or sale, or (2) the
right to exercise the Option as to an equivalent number of shares of Common
Stock of the corporation succeeding the Company or acquiring its business by
reason of such liquidation, dissolution, merger, consolidation or
reorganization.

ARTICLE X

AMENDMENT OR TERMINATION OF PLAN

10.1 Amendments. The Board may at any time amend or revise the terms of the
Plan, provided no such amendment or revision shall, unless appropriate
stockholder approval of such amendment or revision is obtained:

(a) materially increase the maximum number of shares of Common Stock which may
be sold pursuant to Options granted under the Plan;

(b) materially increase the benefits accruing to participants under the Plan;

(c) materially modify the requirements as to eligibility for participants in the
Plan.

10.2 Termination. The Board may suspend or terminate this Plan at any time. This
Plan, unless sooner terminated, shall terminate on the tenth (10th) anniversary
of its adoption by the Board. No Option may be granted under this Plan, while
this Plan is suspended or after it is terminated.

10.3 Holder of Consent. No amendment, suspension or termination of the Plan
shall, without the consent of the holder of Options, alter or impair any rights
or obligations under any Option theretofore granted under the Plan.

ARTICLE XI

MISCELLANEOUS PROVISIONS

11.1 Privilege of Stock Ownership. No Eligible Director entitled to exercise any
Option granted under the Plan shall have any of the rights or privileges of a
stockholder of the Company with respect to any shares of Common Stock issuable
upon exercise of an Option until certificates representing the shares of Common
Stock shall have been issued and delivered.

11.2 Plan Expenses. Any expenses incurred in the administration of the Plan
shall be borne by the Company.

11.3 Use of Proceeds. Payments received from an Eligible Director upon the
exercise of Options shall be used for general corporate purposes of the Company.

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11.4 Governing Law. The Plan has been adopted under the laws of the State of
Delaware. The Plan and all Options which may be granted hereunder and all
matters related thereto, shall be governed by and construed and enforceable in
accordance with the laws of the State of Delaware as it then exists.

11.5 Gender and Number. Except as otherwise indicated by the context, reference
to the masculine gender shall include the feminine gender, the plural shall
include the singular and the singular shall include the plural.

11.6 Severability. In the event any provision of the Plan shall be held illegal
or invalid for any reason, the illegality or invalidity shall not affect the
remaining parts of the Plan and the Plan shall be construed and enforced as if
the illegal or invalid provision had not been included.

ARTICLE XII

STOCKHOLDER APPROVAL AND EFFECTIVE DATE

The Plan shall be submitted for approval by the holders of the outstanding
voting stock of the Company within twelve (12) months from the date the Plan is
adopted by the Board; provided, however, that if such vote was not solicited
substantially in accordance with the rules and regulations, if any, in effect
under Section 14(a) of the Exchange Act, at the time of such vote, the Company
will furnish in writing to the holders of record of the securities entitled to
vote for the Plan, substantially the same information concerning the Plan which
would be required by the rules and regulations in effect under Section 14(a) of
the Exchange Act, as if proxies to be voted with respect to the approval or
disapproval of the Plan were then being solicited, on or prior to the date of
the first annual meeting of security holders held subsequent to the later of
(i) the first registration of an equity security under Section 12 of the
Exchange Act; or (ii) the acquisition of an equity security for which an
exemption is claimed. The Plan shall be deemed approved by the holders of the
outstanding voting stock of the Company by the affirmative vote of the holders
of a majority of the voting shares of the Company represented and voting at a
duly held meeting at which a quorum is present. Any Options granted under the
Plan prior to obtaining such stockholder approval shall be granted under the
conditions that the Options so granted (i) shall not be exercisable prior to
such approval, and (ii) shall become null and void if such stockholder approval
is not obtained.

ARTICLE XIII

RELOAD OPTIONS

13.1 Reload Option. Whenever the optionee holding any Option outstanding under
the Plan (including Reload Options granted under this Article XIII) exercises
the Option and makes payment of the Exercise Price pursuant to Section 6.5(b) by
tendering Common Stock previously held by the optionee, then the Company shall
automatically grant a Reload Option for the number of shares of Common Stock
that is equal to the number of shares tendered by the optionee on payment of the
Exercise Price of the Option being exercised.

13.2 Reload Option Exercise Price. The Reload Option Exercise Price per share
shall be an amount equal to the Fair Market Value per share of the Company’s
Common Stock determined as of the date of receipt by the Company of the notice
by optionee to exercise the Option.

13.3 Term of Reload Option. The exercise period of the Reload Option shall
expire, and the Reload Option shall no longer be exercisable, on the later of
(i) expiration date of the original surrendered Option, or (ii) one year from
the date of grant.

13.4 Restriction on Exercise. Any Reload Option granted under this Article III
shall vest immediately, but shall not be exercisable until the end of six months
after the date of its issuance, except in the case of the death or permanent
disability of the optionee, upon which event the Reload Option will become
immediately exercisable.

13.5 Other Terms of Reload Options. All other terms of the Reload Options
granted hereunder shall be identical to the terms and conditions of the original
Option, the exercise of which gives rise to the grant of the Reload Option.