Exhibit 10.2
SEVERANCE AGREEMENT
     SEVERANCE AGREEMENT (this “Agreement”) dated as of November 13, 2008, by
and between BIOSCRIP, INC., a Delaware corporation, with its principal place of
business at 100 Clearbrook Road, Elmsford, New York 10523 (hereinafter referred
to as the “Company”), and Richard M. Smith (hereinafter referred to as the
“Executive”).
     WHEREAS, the Executive and the Company are parties to an employment offer
letter dated as of November 13, 2008 (the “Offer Letter”)
     WHEREAS, pursuant to the terms of the Offer Letter the Company agreed to
enter into this Agreement in order to provide Executive with the severance
payment protection upon termination of Executive’s employment with the Company;
     Accordingly, the parties hereto agree as follows:
     1. Severance upon Death or Disability.
     1.1. Termination upon Death. If the Executive dies while employed by the
Company: (i) the Executive’s estate or beneficiaries shall be entitled to
receive any salary and other benefits (including bonuses awarded or declared but
not yet paid) earned and accrued prior to the date of termination and
reimbursement for expenses incurred prior to the date of termination; (ii) all
fully vested and exercisable stock options (“Options”) previously or hereafter
granted by the Company to Executive under any bonus program and held by the
Executive may be exercised by his estate for a period of one (1) year from and
after the date of the Executive’s death unless such longer period is set forth
in the grant agreement evidencing the Options; (iii) any restricted stock units
(“Restricted Stock Units”) granted under any bonus program or otherwise granted
shall vest and be free from restrictions on transferability (other than
restrictions on transfer imposed under Federal and State securities laws);
(iv) any shares of common stock granted (“Stock Grants”) to Executive under any
bonus program that are subject to forfeiture shall become non-forfeitable and
shall be fully vested and transferable; and (v) the Executive’s estate and
beneficiaries shall have no further rights to any other compensation or benefits
hereunder on or after the termination of employment, or any other rights
hereunder. Notwithstanding anything to the contrary contained in this
Section 1.1, it is expressly understood and agreed that nothing in the foregoing
clause (v) shall restrict the ability of the Company to amend or terminate any
benefits plans and programs from time to time in its sole and absolute
discretion; provided, however, that the Company shall in no event be required to
provide any coverage under such benefit plans and programs after such time as
the Executive becomes entitled to coverage under the benefit plans and programs
of another employer or recipient of the Executive’s services (and provided,
further, that such entitlement shall be determined without regard to any
individual waivers or other arrangements).
     1.2. Severance upon Disability. Upon termination of employment by virtue of
Executive’s disability, (i) the Executive shall receive salary and other
benefits (including bonuses awarded or declared but not yet paid) earned and
accrued prior to the effective date of the termination of employment and
reimbursement for expenses incurred prior to the effective date of the
termination of employment; (ii) all fully vested and exercisable Options
previously or hereafter granted and held by

 

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the Executive may be exercised by the Executive or his estate or beneficiaries
for a period of one (1) year from and after the date of the Executive’s
termination due to disability unless such longer period is set forth in the
grant agreement evidencing the Options; (iii) any Restricted Stock Units granted
under any bonus program or otherwise granted shall vest and be free from
restrictions on transferability (other than restrictions on transfer imposed
under Federal and State securities laws); (iv) any Stock Grants made to
Executive under any bonus program that are subject to forfeiture shall become
non-forfeitable and shall be fully vested and transferable; (v) if the
Executive’s disability shall continue for a period of six (6) months after his
termination, the Executive shall receive for a period for two (2) years after
termination of employment (A) the annual salary that the Executive was receiving
at the time of such termination of employment (“Annual Salary”), less the gross
proceeds paid to the Executive on account of Social Security or other similar
benefits and Company provided long-term disability insurance, payable in
accordance with the customary payroll practices of the Company applicable to
senior executives, in installments not less frequently than monthly; and
(B) such continuing coverage under the benefit plans and programs the Executive
would have received in the absence of such termination, including, without
limitation, coverage under any health insurance plans or programs which are
available or provided to senior executives of the Company generally, and at the
same cost to Executive, if any, in each case to the extent that the Executive is
eligible under the terms of such plans or programs; it being expressly
understood and agreed that nothing in this clause (v) shall restrict the ability
of the Company to amend or terminate such benefits plans and programs from time
to time in its sole and absolute discretion; provided, however, that the Company
shall in no event be required to provide any coverage under such benefit plans
and programs after such time as the Executive becomes entitled to coverage under
the benefit plans and programs of another employer or recipient of the
Executive’s services (and provided, further, that such entitlement shall be
determined without regard to any individual waivers or other arrangements); and
(vi) the Executive shall have no further rights to any other compensation or
benefits hereunder on or after the termination of employment, or any other
rights hereunder. Notwithstanding the foregoing, if and only to the extent that
Executive’s disability is a trigger for the payment of deferred compensation, as
defined in Section 409A of the Code, “disability” shall have the meaning set
forth in Section 409A(a)(2)(C) of the Code.
     2. Severance in the Event of Certain Terminations of Employment
     2.1. Termination for “Cause”; Termination of Employment by the Executive
Without Good Reason.
     2.1.1. For purposes of this Agreement, “Cause” shall mean (i) the
Executive’s conviction of a felony or a crime of moral turpitude; or (ii) the
Executive’s commission of unauthorized acts intended to result in the
Executive’s personal enrichment at the material expense of the Company; or
(iii) the Executive’s material violation of the Executive’s duties or
responsibilities to the Company which constitute willful misconduct or
dereliction of duty, provided as to any termination pursuant to
Section 2.1.1(iii), a majority of the Compensation Committee of the Board of
Directors (or any successor committee thereto) shall first approve such “Cause”
termination before the Company effectuates such a termination.
     2.1.2. If the Company terminates the Executive for Cause, (i) the Executive
shall receive Annual Salary and other benefits (including bonuses awarded or
declared but not yet paid) earned and

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accrued prior to the effective date of the termination of employment (and
reimbursement for expenses incurred prior to the effective date of the
termination of employment); (ii) all unvested options shall lapse and terminate
immediately and may no longer be exercised; (iii) any unvested Restricted Stock
Units shall terminate immediately; (iv) any Stock Grants made to Executive under
any bonus program that are subject to forfeiture shall be immediately forfeited;
and (v) the Executive shall have no further rights to any other compensation or
benefits hereunder on or after the termination of employment, or any other
rights hereunder.
     2.1.3. The Executive may terminate his employment upon written notice to
the Company which specifies an effective date of termination not less than
30 days from the date of such notice. If the Executive terminates his employment
and the termination is not covered by Sections 1, 2.2, or 2.3 hereof, (i) the
Executive shall receive Annual Salary and other benefits (including bonuses
awarded or declared but not yet paid) earned and accrued prior to the effective
date of the termination of employment (and reimbursement for expenses incurred
prior to the effective date of the termination of employment); (ii) all fully
vested and exercisable options granted by the Company to the Executive under any
bonus program or otherwise and held by the Executive may be exercised by the
Executive for a period of 30 days from and after the date of the Executive’s
effective date of termination unless such longer period is set forth in the
grant agreement evidencing the Options; (iii) any unvested Restricted Stock
Units hereafter granted shall terminate immediately; (iv) any Stock Grants made
to Executive under any bonus program that are subject to forfeiture shall be
immediately forfeited; and (v) the Executive shall have no further rights to any
compensation or other benefits hereunder on or after the termination of
employment, or any other rights hereunder.
     2.2. Termination Without Cause; Termination for Good Reason.
     2.2.1. For purposes of this Agreement, “Good Reason” shall mean the
existence of any one or more of the following conditions that shall continue for
more than 45 days following written notice thereof by the Executive to the
Company: (i) the material change in or reduction of the Executive’s authority,
duties and responsibilities, or the assignment to the Executive of duties
materially inconsistent with the Executive’s position or positions with the
Company; (ii) a reduction in the Executive’s then current Annual Salary without
the Executive’s consent; or (iii) the relocation of the Executive’s principal
location of employment more than fifty (50) miles from the Executive’s current
site without the Executive’s consent.
     2.2.2. If the Company terminates the Executive’s employment and the
termination is not covered by Section 1, 2.1 or 2.3 hereof: (i) the Executive
shall receive Annual Salary and other benefits (including bonuses awarded or
declared but not yet paid) earned and accrued under this Agreement prior to the
effective date of the termination of employment (and reimbursement for expenses
incurred prior to the effective date of the termination of employment); (ii) the
Executive shall receive for two (2) years after termination of employment,
(A) the Annual Salary that the Executive was receiving at the time of such
termination of employment, payable in accordance with the customary payroll
practices of the Company applicable to senior executives, in installments not
less frequently than monthly, and (B) such continuing coverage under the benefit
plans and programs the Executive would have received in the absence of such
termination, including, without limitation, coverage under any health insurance
plans or programs which are available or provided to senior executives of the
Company generally, and at the same cost to Executive, if any, in each case to
the

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extent that the Executive is eligible under the terms of such plans or programs;
it being expressly understood and agreed that nothing in this clause (ii) shall
restrict the ability of the Company to amend or terminate such benefits plans
and programs from time to time in its sole and absolute discretion; provided,
however, that the Company shall in no event be required to provide any coverage
under such benefit plans and programs after such time as the Executive becomes
entitled to coverage under the benefit plans and programs of another employer or
recipient of the Executive’s services (and provided, further, that such
entitlement shall be determined without regard to any individual waivers or
other arrangements); (iii) outstanding unvested Options previously or hereafter
granted to the Executive and held by the Executive shall vest and become
immediately exercisable and all Options held by the Executive on the effective
date of termination may be exercised by the Executive for a period of 30 days
from and after the date of the Executive’s effective date of termination unless
such longer period is set forth in the grant agreement evidencing the Options;
(iv) the Executive shall become vested in any pension or other deferred
compensation other than pension or deferred compensation under a plan intended
to be qualified under Section 401(a) or 403(a) of the Internal Revenue Code of
1986, as amended; (v) any Restricted Stock Units granted under any bonus program
or otherwise granted shall vest and be free from restrictions on transferability
(other than restrictions on transfer imposed under Federal and State securities
laws) as of the date of the Executive’s effective date of termination; (vi) any
Stock Grants made to Executive under any bonus program that are subject to
forfeiture shall become non-forfeitable and shall be fully vested and
transferable as of the date of the Executive’s effective date of termination;
and (vii) the Executive shall have no further rights to any other compensation
or benefits hereunder on or after the termination of employment, or any other
rights hereunder.
     2.2.3. If the Executive terminates his employment for Good Reason and such
termination is not covered by Section 2.3 hereof, (i) the Executive shall
receive Annual Salary and other benefits (including bonuses awarded but not yet
paid) earned and accrued prior to the effective date of the termination of
employment (and reimbursement for expenses incurred prior to the effective date
of the termination of employment); (ii) the Executive shall receive for a period
of two (2) years after termination of employment (A) the Annual Salary that the
Executive was receiving at the time of such termination of employment, payable
in accordance with the customary payroll practices of the Company applicable to
senior executives, in installments not less frequently than monthly, and
(B) such continuing coverage under the benefit plans and programs the Executive
would have received in the absence of such termination, including, without
limitation, coverage under any health insurance plans or programs which are
available or provided to senior executives of the Company generally, and at the
same cost to Executive, if any, in each case to the extent that the Executive is
eligible under the terms of such plans or programs; it being expressly
understood and agreed that nothing in this clause (ii) shall restrict the
ability of the Company to amend or terminate such benefits plans and programs
from time to time in its sole and absolute discretion; provided, however, that
the Company shall in no event be required to provide any coverage under such
benefit plans and programs after such time as the Executive becomes entitled to
coverage under the benefit plans and programs of another employer or recipient
of the Executive’s services (and provided, further, that such entitlement shall
be determined without regard to any individual waivers or other arrangements);
(iii) all outstanding unvested Options previously or hereafter granted to the
Executive under any benefit program shall vest and become immediately
exercisable unless such longer period is set forth in the grant agreement
evidencing the Options; (iv) the Executive shall become vested in any pension or
other deferred compensation other than pension or deferred compensation under a
plan intended to be qualified

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under Section 401(a) or 403(a) of the Internal Revenue Code of 1986, as amended;
(v) any Restricted Stock Units granted under any bonus program or otherwise
granted shall vest and be free from restrictions on transferability (other than
restrictions on transfer imposed under Federal and State securities laws);
(vi) any Stock Grants made to Executive under any bonus program that are subject
to forfeiture shall become non-forfeitable and shall be fully vested and
transferable; and (vii) the Executive shall have no further rights to any other
compensation or benefits hereunder on or after the termination of employment, or
any other rights hereunder.
     2.3. Severance upon a Termination after Change of Control.
     2.3.1. For purposes of this Agreement, “Change of Control” means the
occurrence of one or more of the following: (i) a “person” or “group” within the
means the meaning of sections 13(d) and 14(d) of the Securities and Exchange Act
of 1934 (the “Exchange Act”) becomes the “beneficial owner” (within the meaning
of Rule l3d-3 under the Exchange Act) of securities of the Company (including
options, warrants, rights and convertible and exchangeable securities)
representing 30% or more of the combined voting power of the Company’s then
outstanding securities in any one or more transactions unless approved by at
least two-thirds of the Board of Directors then serving at that time; provided,
however, that purchases by employee benefit plans of the Company and by the
Company or its affiliates shall be disregarded; or (ii) any sale, lease,
exchange or other transfer (in one transaction or a series of related
transactions) of all, or substantially all, of the operating assets of the
Company; or (iii) a merger or consolidation, or a transaction having a similar
effect, where (A) the Company is not the surviving corporation, (B) the majority
of the common stock of the Company is no longer held by the stockholders of the
Company immediately prior to the transaction, or (C) the Company’s common stock
is converted into cash, securities or other property (other than the common
stock of a company into which the Company is merged), unless such merger,
consolidation or similar transaction is with a subsidiary of the Company or with
another company, a majority of whose outstanding capital stock is owned by the
same persons or entities who own a majority of the Company’s common stock at
such time; or (iv) at any annual or special meeting of stockholders of the
Company at which a quorum is present (or any adjournments or postponements
thereof), or by written consent in lieu thereof, directors (each a “New
Director” and collectively the “New Directors”) then constituting a majority of
the Company’s Board of Directors shall be duly elected to serve as New Directors
and such New Directors shall have been elected by stockholders of the Company
who shall be an (I) “Adverse Person(s)”; or (II) “Acquiring Person(s)” (as each
of the terms set forth in (I) and (II) hereof are defined in that certain
Amended and Restated Rights Agreement, dated as of December 3, 2002, between the
Company and American Stock Transfer & Trust Company, as Rights Agent).
     2.3.2. If within the one (1) year period commencing upon the effective date
of any Change of Control, the Executive is terminated by the Company or a
successor entity and the termination is not covered by Section 1 or 2.1 hereof,
or, within such one (1) year period, the Executive elects to terminate his
employment after the Company or a successor entity materially reduces or changes
the Executive’s authority, duties and responsibilities or the Company assigns
the Executive duties materially inconsistent with the Executive’s position or
positions with the Company or a successor entity immediately prior to such
Change of Control, (i) the Executive shall receive Annual Salary and other
benefits (including bonuses awarded or declared but not yet paid) earned and
accrued under this Agreement prior to the effective date of the termination of
employment (and reimbursement for expenses incurred prior to the effective date
of the termination of employment); (ii) the Executive

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shall receive (A) for two (2) years after termination of employment; the Annual
Salary that the Executive was receiving at the time of such termination of
employment, payable in accordance with the customary payroll practices of the
Company applicable to senior executives, in installments not less frequently
than monthly, and (B) for two (2) years after termination of employment, such
continuing coverage under the benefit plans and programs the Executive would
have received in the absence of such termination, including, without limitation,
coverage under any health insurance plans or programs which are available or
provided to senior executives of the Company generally, and at the same cost to
Executive, if any, in each case to the extent that the Executive is eligible
under the terms of such plans or programs; it being expressly understood and
agreed that nothing in this clause (ii) shall restrict the ability of the
Company to amend or terminate such benefits plans and programs from time to time
in its sole and absolute discretion; provided, however, that the Company shall
in no event be required to provide any coverage under such benefit plans and
programs after such time as the Executive becomes entitled to coverage under the
benefit plans and programs of another employer or recipient of the Executive’s
services (and provided, further, that such entitlement shall be determined
without regard to any individual waivers or other arrangements); (iii) all
outstanding unvested Options previously or hereafter granted under any bonus
program or otherwise and held by the Executive shall vest and become immediately
exercisable and shall otherwise be exercisable in accordance with their terms;
(iv) the Executive shall become vested in any pension or other deferred
compensation other than pension or deferred compensation under a plan intended
to be qualified under Section 401(a) or 403(a) of the Internal Revenue Code of
1986, as amended; (v) any Restricted Stock Units shall vest and be free from
restrictions on transferability (other than restrictions on transfer imposed
under Federal and State securities laws); (vi) any Stock Grants made to
Executive under any bonus program that are subject to forfeiture shall become
non-forfeitable and shall be fully vested and transferable as of the date of the
Executive’s effective date of termination; and (vii) the Executive shall have no
further rights to any other compensation or benefits hereunder on or after the
termination of employment or any other rights hereunder.
     2.3.3. The payments, benefits and vesting, if any, to which Executive is
entitled under Section 2.3.2 (and all other payments, benefits and vesting to
which Executive may be entitled) shall be provided without regard to whether the
deductibility of such payments, benefits and vesting would be limited or
precluded by Section 280G of the Internal Revenue Code (“Section 280G”) and
without regard to whether such payments (or any other payment, benefits and
vesting) would subject Executive to the federal excise tax levied on certain
“excess parachute payments” under Section 4999 of the Code (the “Excise Tax”).
If any portion of the payments, benefits and vesting to or for Executive’s
benefit (including, but not limited to, payments, benefits and vesting under
this Agreement but determined without regard to this paragraph) constitutes an
“excess parachute payment” within the meaning of Section 280G (the aggregate of
such payments being hereinafter referred to as the “Excess Parachute Payments”),
the Company shall promptly pay to Executive an additional amount (the “gross-up
payment”) that after reduction for all taxes (including but not limited to the
Excise Tax) with respect to such gross-up payment equals the Excise Tax with
respect to the Excess Parachute Payments; provided, that to the extent any
gross-up payment would be considered “deferred compensation” for purposes of
Section 409A of the Internal Revenue Code (“Section 409A”), the manner and time
of payment, and the provisions of this Section shall be adjusted to the extent
necessary (but only to the extent necessary) to comply with the requirements of
Section 409A with respect to such payment so that the payment does not give rise
to the interest or additional tax amounts described at Section 409A(a)(1)(B) or
Section 409A(b)(4) of the Code. The determination

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as to whether Executive’s payments, benefits and vesting include Excess
Parachute Payments and, if so, the amount of such, the amount of any Excise Tax
owed with respect thereto, and the amount of any gross-up payment shall be made
at the Company’s expense by such certified public accounting firm as the Board
of Directors may designate prior to a Change of Control.
     3. Other Provisions
     3.1 To the extent applicable, it is intended that this Agreement comply
with the provisions of Section 409A in accordance with the provisions below:

  a)   The Agreement will be administered and interpreted in a manner consistent
with this intent, and any provision that would cause the Agreement to fail to
satisfy Section 409A will have no force and effect until amended to comply
therewith (which amendment may be retroactive to the extent permitted by
Section 409A). In addition, the parties shall cooperate fully with one another
to ensure compliance with Section 409A, including, without limitation, adopting
amendments to arrangements subject to Section 409A and operating such
arrangements in compliance with Section 409A.     b)   Notwithstanding any other
provision of the Agreement to the contrary, to the extent any payment or benefit
to be paid or provided to Executive pursuant to the Agreement as a result of the
termination of his employment constitutes “non-qualified deferred compensation”
subject to Section 409A, such payment or benefit shall be paid or provided to
the Executive under the Agreement at such time as the Executive would be
considered to have incurred a “separation from service” from the Company within
the meaning of Section 409A (without regard to whether such “separation from
service” comes before, after or coincides with his termination of employment).
For purposes of clarification, this paragraph shall not cause a forfeiture of
any payment or benefits on the part of Executive, but shall only act as a delay
until such time as a “separation from service” occurs.     c)   Notwithstanding
any other provisions of the Agreement to the contrary, if any amount (including
imputed income) to be paid to Executive pursuant to the Agreement as a result of
Executive’s termination of employment is “deferred compensation” subject to
Section 409A, and if Executive is a “specified employee” (as defined under
Section 409A) as of the termination date, then, to the extent necessary to avoid
the imposition of additional tax or other penalties under Section 409A, the
payment of benefits, if any, scheduled to be paid by the Company to Executive
hereunder during the first six-month period following the date of employment
termination shall not be paid until the date which is the first business day
which comes six months and a one day after the date the Executive has incurred a
“separation from service” within the meaning of Section 409A. Any deferred
compensation payments delayed in accordance with the terms of this Section shall
be paid in a lump sum on the first day following such six-month and one day
period.

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  d)   With respect to items eligible for reimbursement under the terms of the
Agreement, (i) the amount of such expenses eligible for reimbursement in any
taxable year shall not affect the expenses eligible for reimbursement in another
taxable year, (ii) no such reimbursement may be exchanged or liquidated for
another payment or benefit, and (iii) any reimbursements of such expenses shall
be made no later than the end of the calendar year following the calendar in
which the related expenses were incurred, except, in each case, to the extent
that the right to reimbursement does not provide for a “deferral of
compensation” within the meaning of Section 409A.     e)   It is intended that
each installment of payments and benefits provided under the Agreement shall be
treated as a separate identified payment for purposes of Section 409A. Neither
the Company nor Executive shall have the right to accelerate or defer the
delivery of any such payments or benefits except to the extent specifically
permitted or required by Section 409A.     f)   The Company agrees to act in
good faith under this Section 3.1 based on the guidance available from the
Treasury Department and Internal Revenue Service respecting the proper
interpretation of Section 409A, but nothing in this Section 3.1 shall
constitute, or be construed as, a covenant by the Company that no payment will
be made or benefit will be provided which will be subject to taxation under
Section 409A or as a guarantee or indemnity by the Company with respect to the
tax consequences to any such payment or benefit.

     3.2. Severability. If it is determined that any of the provisions of this
Agreement, or any part thereof, is invalid or unenforceable, the remainder of
the provisions of this Agreement shall not thereby be affected and shall be
given full effect, without regard to the invalid portions thereof.
     3.3. Enforceability; Jurisdictions. Any controversy or claim arising out of
or relating to this Agreement or the breach of this Agreement that is not
resolved by Executive and the Company (or its subsidiaries or affiliates, where
applicable) shall be submitted to arbitration in New York, New York in
accordance with New York law and the procedures of the American Arbitration
Association. The determination of the arbitrator(s) shall be conclusive and
binding on the Company (or its subsidiaries or affiliates, where applicable) and
Executive and judgment may be entered on the arbitrator(s)’ award in any court
having jurisdiction. The cost of any arbitration hereunder shall be borne by the
Company.
     3.4. Notices. Any notice or other communication required or permitted
hereunder shall be in writing and shall be delivered personally, telegraphed,
telexed, sent by facsimile transmission or sent by certified, registered or
express mail, postage prepaid. Any such notice shall be deemed given when so
delivered personally, telegraphed, telexed or sent by facsimile transmission or,
if mailed, five days after the date of deposit in the United States mails as
follows:

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     (i) If to the Company, to:
BioScrip, Inc.
100 Clearbrook Road
Elmsford, New York 10523
Attention: Assistant General Counsel
     with a copy to:
King & Spalding, LLP
1180 Peachtree Street
Atlanta, GA 30309
Attention: Shelly Sharp Blews
     (ii) If to the Executive, to:
Richard M. Smith
                                               
                                               
     with a copy to:
Jennifer B. Rubin
Mintz Levin Cohn Ferris Glovsky and Popeo, P.C.
666 Third Avenue
New York, NY 10017
Any such person may by notice given in accordance with this Section 3.4 to the
other parties hereto designate another address or person for receipt by such
person of notices hereunder.
     3.5. Entire Agreement. This Agreement contains the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements, written or oral, with respect thereto.
     3.6. Waivers and Amendments. This Agreement may be amended, superseded,
canceled, renewed or extended, and the terms hereof may be waived, only by a
written instrument signed by the parties or, in the case of a waiver, by the
party waiving compliance. No delay on the part of any party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any waiver on the part of any party of any such right, power or privilege nor
any single or partial exercise of any such right, power or privilege, preclude
any other or further exercise thereof or the exercise of any other such right,
power or privilege.
     3.7. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPALS
OF CONFLICTS OF LAW.

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     3.8. Assignment. This Agreement, and the Executive’s rights and obligations
hereunder, may not be assigned by the Executive; any purported assignment by the
Executive in violation hereof shall be null and void. In the event of any sale,
transfer or other disposition of all or substantially all of the Company’s
assets or business, whether by merger, consolidation or otherwise, the Company
(without limiting the Executive’s rights under Section 2.3) may assign this
Agreement and its rights hereunder.
     3.9. Withholding. The Company shall be entitled to withhold from any
payments or deemed payments any amount of tax withholding required by law.
     3.10. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors, permitted assigns,
heirs, executors and legal representatives.
     3.11. Counterparts. This Agreement may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered shall be an
original but all such counterparts together shall constitute one and the same
instrument. Each counterpart may consist of two copies hereof each signed by one
of the parties hereto.
     3.12. Survival. Anything contained in this Agreement to the contrary not
withstanding, the provisions hereof shall survive any termination of the
Executive’s employment hereunder.
     3.13. Headings. The headings in this Agreement are for reference only and
shall not affect the interpretation of this Agreement.
     3.14. Supersedes Prior Agreements. Upon execution and delivery of this
Agreement, this Agreement shall supersede in its entirety any and all prior
agreements with respect to the Company’s and the Executive’s respective rights
and obligations upon the termination of the Executive’s employment with the
Company.
     IN WITNESS WHEREOF, the parties hereto have signed their names as of the
day and year first above written.
BIOSCRIP, INC.

                 
By:
               
 
 
 
Barry A. Posner,      
 
Richard M. Smith    
 
  Executive Vice President            

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