UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   Form 10-K/A

                                 Amendment No. 1

      X      Annual Report Pursuant to Section 13 or 15(d) of the Securities
----------   Exchange Act of 1934
             For the fiscal year ended December 31, 2001 or

            Transition Report Pursuant to Section 13 or 15(d) of the Securities
----------  Exchange Act of 1934
            For the transition period from ---------- to -------------

                          Commission File No. 0-20619

                             MATRIA HEALTHCARE, INC.
             (Exact name of registrant as specified in its charter)

                               Delaware 58-2205984
        (State or other jurisdiction of (IRS Employer Identification No.)
                    incorporation or organization)

   1850 Parkway Place
    Marietta, Georgia                                              30067
   (Address of principal executive offices)                     (Zip Code)

Registrant's telephone number, including area code (770) 767-4500

The Registrant hereby files this Form 10-K/A to amend its Annual Report on Form
10-K for the fiscal year ended December 31, 2001 to include the information
required by Part III (Items 10, 11, 12 and 13) in lieu of the incorporation
thereof by reference from the Registrant's definitive proxy statement for its
Annual Meeting of Shareholders.


<PAGE>


                                    PART III

Item 10. Directors and Executive Officers of the Registrant

         The names of the current directors and executive officers, their ages
as of April 1, 2002 and certain other information about them are set forth
below.

         Parker H. Petit, age 62, has served as Chairman of the Board of the
Company since the formation of the Company through the merger (the "Merger") of
Tokos Medical Corporation and Healthdyne Maternity Management ("Healthdyne") on
March 8, 1996 (the "Merger Date") and as President and Chief Executive Officer
since October 5, 2000. In addition, he served as a member of the three-person
Office of the President during a brief period in 1997. Mr. Petit was the founder
of Healthdyne and served as its Chairman of the Board of Directors and Chief
Executive Officer from 1970 until the Merger. Mr. Petit is also a director of
Intelligent Systems Corp. and Logility, Inc.

         Jeffrey D. Koepsell, age 55, has served as a director of the Company
and as Executive Vice President and Chief Operating Officer since May 17, 2000.
From 1992 to 1998, he was President and Chief Executive Officer of CardioLogic
Systems, Inc., a venture capital-backed company in the cardiopulmonary market
segment formed in cooperation with Johns Hopkins University and Medical Center.
Prior thereto, he served as President and Chief Executive Officer of Physiologic
Diagnostic Services, Inc., a women's health service provider acquired by Tokos
Medical Corporation in 1992. Mr. Koepsell is also a former executive of
Healthdyne.

         Guy W. Millner, age 66, has been a director of the Company since
October 4, 2000. Mr. Millner is Chairman of MI Holdings, a private investment
firm. Until the fall of 1997 he was Chairman of Norrell Corporation, a staffing
services and outsourcing firm, which he founded in 1961. From 1997 until July
1999 he served as a director of Norrell Corporation, at which time Norrell
Corporation merged with Spherion Corporation.

         Carl E. Sanders, age 76, has served as a director of the Company since
the Merger Date and previously served as a director of Healthdyne from 1986
until the Merger. Mr. Sanders, a former governor of the State of Georgia, is
Chairman of Troutman Sanders LLP, an Atlanta based law firm that provides legal
services to the Company.

         Thomas S. Stribling, age 59, has served as a director of the Company
since May 18, 2000. Mr. Stribling has been President and Chief Executive Officer
of DermaCo, Inc. a development stage dermatology company since September 1, 2002
and was an entrepreneur and private investor from September 1999 to September
2001. From 1998 to September 1999, he was President, Chief Executive Officer and
a board member of Scandipharm, Inc., a privately held pharmaceutical company.
Prior thereto, he was Vice Chairman and Chairman of the Advisory Board of Legacy
Securities Corporation, an investment banking and securities group, from 1997 to
1998, and from 1994 to 1996, he was President of UCB Pharma, Inc., a division of
a Belgian-based pharmaceutical company.

         Jackie M. Ward, age 63, has served as a director of the Company since
the Merger Date. Ms. Ward was Founder, Chairman and Chief Executive Officer of
Computer Generation Incorporated, which she founded in 1968, until December
2000. In December 2000, Computer Generation Incorporated, was purchased by Intec
Telecom Systems and she currently serves in the capacity of Outside Managing
Director of Intec, a British based corporation engaged in designing and
producing computer software systems for telecommunications and other specialized
applications. Ms. Ward is also a former Chairperson of the Board of Regents of
the University System of Georgia and former Chairman of the Metro Atlanta
Chamber of Commerce, as well as a director of Bank of America, Equifax, Inc.,
PTEK Holdings, Inc., PRG-Schultz International, Inc., Sanmina-SCI Corporation,
Flowers Foods, Inc., Trigon Healthcare, Inc.and SYSCO Corporation and a member
of several other civic and government organizations.
<PAGE>

     Donald W. Weber,  age 65, has served as a director of the Company since May
18, 2000. Mr. Weber is a private investor.  He was President and Chief Executive
Officer of Viewstar  Entertainment  Services,  Inc., a distributor  of satellite
entertainment systems, from August 1993 until November 1997. Prior thereto, from
1987 to 1991 he was President and Chief Executive Officer of Contel Corporation,
a telecommunications  supplier, which was sold in 1991 to GTE Corp. Mr. Weber is
also a director of Knology Holdings, Inc.

     Morris S. Weeden, age 82, has served as a director of the Company since the
Merger Date and  previously  served as a director of Healthdyne  from 1987 until
the Merger. Mr. Weeden,  who is retired,  was Vice Chairman - Board of Directors
of Morton  Thiokol Inc., a salt,  chemical,  household  and  aerospace  products
manufacturer,  from March 1980 to December 1984.  Previous positions held by Mr.
Weeden include  Executive Vice  President of Morton  Norwich  Products,  Inc. in
charge  of  pharmaceutical  operations,  President  of Morton  International,  a
pharmaceutical  division of Morton  Norwich  Products,  Inc.,  and  President of
Bristol  Laboratories,  a  pharmaceutical  division of Bristol  Myers Corp.  Mr.
Weeden is also a director of Stat-Chem, Inc.

         Frederick P. Zuspan, M.D., age 80, has served as a director of the
Company since the Merger Date and previously served as a director of Healthdyne
from 1993 until the Merger. Dr. Zuspan, who has been a physician since 1951, has
been Professor and Chairman Emeritus, Department of Obstetrics and Gynecology at
the Ohio State University College of Medicine since July 1991 and
Editor-in-Chief of the American Journal of Obstetrics and Gynecology since 1991
and as editor since 1969. Dr. Zuspan was previously Professor of the Ohio State
University College of Medicine from 1987 to 1991 and Professor and Chairman of
the Department of Obstetrics and Gynecology at the Ohio State University College
of Medicine from 1975 to 1987, at the University of Chicago, Pritzker School of
Medicine from 1966 to 1975, and at the Medical College of Georgia from 1960 to
1966.

         George W. Dunaway, age 41, has been Vice President - Finance and Chief
Financial Officer since October 5, 1999. Prior thereto, Mr. Dunaway was employed
by The Dun & Bradstreet Corporation, a commercial credit information services
provider, in the following capacities: Chief Financial Officer of Dun &
Bradstreet, U.S. from 1996 to October 1999; Vice President - Finance, Dun &
Bradstreet, U.S. from 1995 to 1996; Chief Financial Officer of Dun & Bradstreet
Plan Services from 1992 to 1995 and Assistant Vice President - Strategic
Planning, Dun & Bradstreet Plan Services from 1989 to 1992.

         Yvonne V. Scoggins, age 52, has been Vice President - Financial
Planning and Analysis since February 28, 2001 and previously was Vice President,
Treasurer and Chief Accounting Officer of the Company from December 15, 1997 to
February 28, 2001 and also Vice President and Controller from March 8, 1996 to
December 15, 1997. Prior thereto, she was Vice President and Controller of
Healthdyne from May 1995 to March 8, 1996; Vice President - Planning and
Analysis of Healthdyne from May 1993 to May 1995; and Vice President and Chief
Financial Officer of Home Nutritional Services, Inc., a former majority owned
subsidiary of Healthdyne, from February 1990 to April 1993.

         Roberta L. McCaw, age 46, has been Vice President - Legal, General
Counsel and Secretary of the Company since April 23, 1998 and previously was
Assistant General Counsel and Assistant Secretary of the Company from December
15, 1997 to April 23, 1998, and Assistant General Counsel from July 1996 to
December 1997. Prior thereto, Ms. McCaw was a partner at Tyler, Cooper & Alcorn,
a Connecticut-based law firm, from January 1990 to July 1996.
<PAGE>

         Thornton A. Kuntz, Jr., age 48, has been Vice President -
Administration since February 24, 1998 and previously was Vice President - Human
Resources of the Company from March 8, 1996 to February 24, 1998. Prior thereto,
he served as Vice President - Administration of Healthdyne from August 1992 to
March 1996.

Item 11. Executive Compensation

     The following  table sets forth  compensation  paid to the Company's  Chief
Executive Officer and the four other most highly compensated  executive officers
serving on December 31, 2001 (the "Named Executive Officers") for their services
in all  capacities  to the Company and its  subsidiaries  in fiscal  years 2001,
2000, and 1999:

<TABLE>
<CAPTION>

                                                          Summary Compensation Table
                                                                                            Long-term
                                                           Annual Compensation         Compensation Awards
                                                                                      Securities Underlying           All Other
Name and Principal Position                   Year       Salary ($)    Bonus ($)           Options (#)           Compensation ($)(1)
------------------------------------------ ----------- ----------------------------- ------------------------- ---------------------
<S>                                         <C>         <C>           <C>             <C>                      <C>

Parker H. Petit (2)                           2001       $425,038         -0-               238,750                   $524,449
    Chairman of the Board, President and      2000         96,924         -0-                41,250                    472,603
    Chief Executive Office                    1999          -0-           -0-                17,500                    506,370

Jeffrey D. Koepsell (3)                       2001       $320,031         -0-               119,935                       $279
    Executive Vice President and Chief        2000        189,231         -0-                22,500                        300
    Operating Officer

Frank D. Powers (4)                           2001       $300,000      $119,513              28,856                   $207,829
    President, Population Health              2000        315,599        73,991              21,250                    203,270
    Management                                1999        320,494          -0-               21,350                    179,446

George W. Dunaway (5)                         2001       $215,918          -0-               14,145                    $ 5,290
    Vice President - Finance and Chief        2000        203,355          -0-                1,875                      5,288
    Financial Officer                         1999         50,000          -0-               10,000                     21,821

James P. Reichmann (6)                        2001       $218,416          -0-               16,856                   $145,834
    President, Women's Health                 2000        205,900          -0-                7,544                    127,837
                                              1999        188,055          -0-                6,525                    118,104


(1)      Details of amounts reported in "All Other Compensation" column are provided in the table below.
(2)      Mr. Petit was elected President and Chief Executive Officer on October 4, 2000.
(3)      Mr. Koepsell was elected to this position on May 17, 2000.
(4)      Mr. Powers served as President, Population Health Management through December 31, 2001.
         He retired from the Company March 31, 2002.
(5)      Mr. Dunaway was elected to this position on October 5, 1999.
(6)      Mr. Reichmann was elected to the new position of Corporate Vice President of Strategic Sales on February 11, 2002.
</TABLE>


<PAGE>

<TABLE>


Item                                  Mr. Petit    Mr. Koepsell     Mr. Powers       Mr. Dunaway       Mr. Reichmann
-------------------------- -------- -------------- -------------- ---------------- ----------------- -------------------
<S>                      <C>        <C>              <C>        <C>               <C>                <C>


Officer Term Life          2001        $29,698        $279          $5,669             $190               $2,001
Insurance                  2000         30,098         300           5,946              188                1,045
                           1999         29,949         N/A           5,985               29                  988


Split Dollar Insurance     2001       $280,088         $-0-       $201,583              $-0-            $138,733
Premium Value              2000        330,005          -0-        192,224               -0-             121,692
                           1999        326,421          N/A        168,661               -0-             112,316

401(k) Matching            2001         $-0-           $-0-         $  577            $5,100              $5,100
Contributions              2000          -0-            -0-          5,100             5,100               5,100
                           1999          N/A            N/A          4,800               -0-               4,800

Non-Employee Board         2001          N/A            N/A            N/A               N/A                 N/A
Retainer                   2000        112,500          N/A            N/A               N/A                 N/A
                           1999        150,000          N/A            N/A               N/A                 N/A


Relocation Expenses        2001          N/A            N/A            N/A               N/A                 N/A
                           2000          N/A            N/A            N/A               N/A                 N/A
                           1999          N/A            N/A            N/A           $21,792                 N/A

Loan Forgiveness(1)        2001       $214,663          N/A            N/A               N/A                 N/A
                           2000          N/A            N/A            N/A               N/A                 N/A
                           1999          N/A            N/A            N/A               N/A                 N/A

Total All Other            2001       $524,449         $279       $207,829          $  5,290            $145,834
Compensation               2000        472,603          300        203,270             5,288             127,837
                                       506,370          N/A        179,446            21,821             118,104

(1)     See "CEO Compensation".

</TABLE>



<PAGE>


Stock Options

     The following table contains information concerning the grant of stock
options to the Named Executive Officers of the Company during 2001:

                        Option Grants in Last Fiscal Year

<TABLE>
<CAPTION>

                                                                                               Potential Realizable Value at
                                                                                             Assumed Annual Rates of Stock Price
                                              Individual Grants                                Appreciation for Option Term (1)
                                Number of          % of Total
                                Securities        Options/SARs
                                Underlying         Granted to       Exercise or
                             Options Granted      Employees in      Base Price    Expiration Date
<S>                             <C>             <C>                <C>          <C>                     <C>             <C>

Name                               (#)            Fiscal Year         ($/Sh)                             5% ($)            10% ($)
Parker H. Petit                   38,750 (2)          6.3%              $14.63      2/16/2001        $   356,528        $   903,513
                                 200,000 (3)         32.5%              $15.85      5/24/2011          1,993,596          5,052,164
Jeffrey D. Koepsell               19,935 (2)          3.2%              $14.63      2/16/2011            183,417            464,813
                                 100,000 (3)         16.2%              $15.85      5/24/2011            996,798          2,526,082
Frank D. Powers                   13,356 (2)          2.2%              $14.63      2/16/2011            122,885            311,415
                                   5,000 (3)          0.8%              $15.85      5/24/2011             49,840            126,304
                                  10,500 (4)          1.7%              $18.91      7/24/2011            124,870            316,446
George W. Dunaway                  6,645 (2)          1.1%              $14.63      2/16/2011             61,138            154,938
                                   1,500 (3)          0.2%              $15.85      5/24/2011             14,952             37,891
                                   6,000 (4)          1.0%              $18.91      7/24/2011             71,354            180,826
James P. Reichmann                 6,856 (2)          1.1%              $14.63      2/16/2011             63,080            159,858
                                   2,500 (3)          0.4%              $15.85      5/24/2011             24,920             63,152
                                   7,500 (4)          1.2%              $18.91      7/24/2011             89,193            226,033
</TABLE>

(1)   Based on actual option term and annual compounding. These amounts are
      calculated pursuant to applicable requirements of the SEC and do not
      represent a forecast of the future appreciation of the Company's Common
      Stock.

(2)   These options to purchase the Company's Common Stock were granted on
      February 16, 2001 as follows: a total of 72,041 shares under the Company's
      2000 Stock Incentive Plan (the "2000 Plan"), 6,645 shares under the
      Company's 1997 Stock Incentive Plan (the "1997 Plan") and 6,856 shares
      under the Company's 1996 Stock Incentive Plan (the "1996 Plan"). Full
      vesting shall occur not before two years and not later than four years
      from the date of grant, based on performance vesting thresholds.

(3)  These options to purchase the Company's Common Stock were granted on May
     24, 2001 as follows: a total of 100,000 shares under the Company's 2001
     Stock Incentive Plan, 186,250 shares under the 2000 Plan, 10,248 shares
     under the 1997 Plan and 3,502 shares under the 1996 Plan.  Full vesting
     shall occur not before two years and not later than four years from the
     date of grant, based on performance vesting thresholds.

(4)  These options to purchase the Company's Common Stock were granted on July
     24, 2001 as follows: a total of 16,500 shares under the Company's 1997 Plan
     and 7,500 shares under the Company's 1996 Plan. Full vesting shall occur
     not before two years and not later than four years from the date of grant,
     based on performance vesting thresholds.


<PAGE>




Stock Option Exercises

         The following table sets forth information with respect to the Named
Executive Officers concerning the exercise of options in 2001 and unexercised
options held as of the end of the fiscal year:


-------------------------------------------------------------------------------
                 Aggregated Option Exercises in Last Fiscal Year
                           and FY - End Option Values

<TABLE>
<CAPTION>
                                                                          Number of Securities     Value of Unexercised In the-Money
                                                                         Underlying Unexercised    Options at Fiscal Year End($) (1)
                                                                         Options at Fiscal Year
                                                                                 End(#)
------------------------------ --------------- ------------------ --------------------------------- --------------------------------
<S>                              <C>            <C>              <C>            <C>                  <C>                <C>

Name                               Shares       Value Realized     Exercisable     Unexercisable       Exercisable     Unexercisable
                                Acquired on    (Market Price at
                                Exercise (#)     exercise less
                                                exercise price)
Parker H. Petit                     -0-               -0-                 38,750           277,500        $601,937.50  $5,330,412.50
Jeffrey D. Koepsell                 -0-               -0-                  7,500           134,935         124,725.00   2,256,150.00
Frank D. Powers                     -0-               -0-                108,512            47,058       1,136,252.56     784,876.26
George W. Dunaway                   -0-               -0-                  3,958            22,062          66,967.04     389,341.71
James P. Reichmann                  -0-               -0-                 26,934            27,707         319,801.17     466,925.13
</TABLE>

(1) Based on $34.63, the last sale price of the Company's Common Stock on
December 31, 2001.

Compensation of Directors

     The  Directors  who are  employees  of the  Company  receive no  additional
compensation  for  serving  on the  Board of  Directors.  Directors  who are not
employees of the Company ("Non-Employee  Directors") receive a fee of $3,000 per
quarter, plus $1,000 for each Board meeting attended and $750 for each Committee
meeting  attended  on a day other  than a day on which a Regular  Meeting of the
Board is held, and are reimbursed for any travel expenses incurred.

     In addition, under the 2000 Directors' Non-Qualified Stock Option Plan, all
Non-Employee  Directors  are entitled to receive an initial  grant of options to
purchase  1,250 shares of the Company's  Common Stock and at each annual meeting
of stockholders after their first full year serving as a director, an additional
grant of options to purchase 3,750 shares of Common Stock.  The option price for
all such options is the fair market value of the underlying  Common Stock on the
date of grant.  Options have a ten year term and vest monthly over 12 months. On
May 24, 2001, each  Non-Employee  Director other than Mr. Millner was awarded an
option to purchase  3,750  shares of Common Stock at a price of $15.85 per share
under the 2000 Directors' Non-Qualified Stock Option Plan.
<PAGE>

Severance Agreements

     The Company and Mr. Powers are party to a severance  agreement  dated April
27, 1999. The severance  agreement  provides for a lump sum severance payment to
Mr. Powers in the event that his  employment  is  involuntarily  terminated  for
reasons other than his death,  disability or "cause" (defined as certain acts of
criminal or civil fraud), or if he voluntarily  terminates  employment for "good
reason"  (defined  as failure  to be  reelected  as an  officer of the  Company,
reduction in base salary,  discontinuance  of certain  incentive or stock option
plans or actions materially  adversely  affecting his participation  therein, or
failure to honor earned and accrued vacation balances). The severance payment is
in an amount equal to two times Mr. Powers' annual base salary and targeted base
bonus as of the date of the agreement (the "Severance Amount").  Mr. Powers also
is entitled to a lump sum severance  payment if he  voluntarily  terminates  his
employment  without  "good  reason"  at any time  after  the  first  year of the
agreement.  In such case, the severance payment is equal to the Severance Amount
less the  amount  of any  gain  accruing  to Mr.  Powers  after  the date of the
agreement with respect to stock options  granted to him by the Company  (whether
the grant date is before or after the date of the agreement) through the earlier
of the date of exercise or the date of expiration of the option. In addition, he
circumstances in which Mr. Powers is entitled to a severance  payment,  the also
is entitled to receive, for a period of two years after the date of termination,
life, disability and health insurance coverage,  automobile allowances and other
fringe  benefits  equivalent  to those in effect at the date of  termination  of
employment.  The agreement  requires Mr. Powers to comply with certain covenants
that preclude him from  competing  with the Company or  soliciting  customers or
employees  of the Company  for a period of two years  following  termination  of
employment.  Mr. Powers  terminated  his  employment  with the Company for "good
reason" on March 31,  2002,  thereby  entitling  him to a  severance  payment of
$969,931 and a continuation of benefits as provided by the Agreement.

     In addition to the  agreement  discussed in the  preceding  paragraph,  the
Company entered into change in control severance  agreement with Mr. Powers. Mr.
Powers'  agreement  terminated  upon  termination of his employment on March 31,
2002.

     At its  February  19,  2002  meeting the Board  approved  change in control
severance  agreements  for Mr. Petit,  Mr.  Koepsell and Mr.  Dunaway.  Although
formal  agreements  have yet to be finalized,  the  arrangement  approved by the
Board  contemplates  that  if  the  executive's   employment  with  the  Company
terminates following the consummation of a "change in control" for reasons other
than the  executive's  death,  disability or retirement,  or, by the Company for
"cause" (as defined in the preceding paragraph),  or if the executive terminates
employment  for "good reason" (which is defined to include the reasons set forth
in the  preceding  paragraph  as well as other  reasons,  such as a reduction in
powers and  responsibilities or an adverse change in title following a change in
control),  the executive  will receive a lump sum  severance  payment equal to a
multiple of the  executive's  annual base salary as of the date of the change in
control. The multiples applicable to Mr. Petit, Mr. Koepsell and Mr. Dunaway are
three,  two  and  one,  respectively.  In  addition,  following  termination  of
employment,  the  executives are entitled to receive for a period of three years
in the case of Mr. Petit,  two years in the case of Mr. Koepsell and one year in
the case of Mr. Dunaway,  all life,  disability and health  insurance  coverage,
automobile allowances and other fringe benefits equivalent to those in effect at
the date of termination and will be entitled to receive additional  amounts,  if
any,  relating  to any  excise  taxes  imposed on the  executive  as a result of
Section  280(g) of the Internal  Revenue Code of 1986,  as amended (the "Code").
The  agreements  require the  executive  to comply with certain  covenants  that
preclude the executive from  competing with the Company or soliciting  customers
or employees of the Company for a period  following  termination  of  employment
equal to the period for which fringe benefits are continued under the applicable
agreement.

         On May 16, 2000, the Company entered into a letter agreement with Mr.
Koepsell providing for 12 months of severance pay and benefits if the Company
terminates Mr. Koepsell's employment for reasons other than "for cause." The
letter agreement also provides that if the Company terminates Mr. Koepsell's
employment other than "for cause" within 24 months of his hire date, the Company
will retain Mr. Koepsell as a consultant on a "prn" basis for the balance of the
24-month period, at compensation to be decided upon at the sole discretion of
the Company and deducted from the 12-month severance pay to which he would
otherwise be entitled.
<PAGE>

         Notwithstanding anything to the contrary set forth in any of the
Company's previous filings under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, that might incorporate future
filings, including this Proxy Statement, in whole or in part, the Compensation
Committee Report on Corporate Compensation, the Report of the Audit Committee
and the Stock Performance Graph shall not be incorporated by reference into any
such filings.



             Compensation Committee Report on Corporate Compensation


         The Company's executive compensation program is designed to (1)
integrate pay and incentive plans with the Company's strategic goals, so as to
align the interests of management with the long-term interests of the Company's
stockholders, (2) attract, motivate and retain executives capable of achieving
the Company's strategic business goals (3) recognize outstanding individual
contributions and (4) provide compensation opportunities that are competitive
with those offered by other companies of similar size and performance,
especially within the healthcare industry. To achieve these goals, the Company's
executive compensation program consists of three elements: (i) base salary, (ii)
annual cash bonus, and (iii) long-term incentives in the form of stock options.
Each element of compensation has an integral role in the total executive
compensation program, including the compensation of the Named Executive
Officers.

         In making its compensation determinations, the Compensation Committee
evaluates, on both an absolute and relative basis, a variety of Company
financial results (including sales, earnings, return on equity, return on assets
and balance sheet strength), market share and competitive position, the
potential for future growth, the overall importance of the individual to the
organization and the individual and group performance of senior management and
compensation levels at comparable companies, especially within the healthcare
industry. In formulating its determinations, it recognizes and rewards
achievements on an annual basis, while emphasizing the value and importance of
sustained long-term performance and recognition of developing trends within the
healthcare industry. The Compensation Committee reviews information prepared or
compiled by the Company, and also draws on the business experience of the
individual members of the Compensation Committee.

         Cash Compensation. Officers and other employees are compensated within
salary ranges that are generally based on similar positions in companies of
comparable size and complexity to the Company. The actual base pay level for
each executive officer is based on a combination of experience, performance and
other factors that are determined to be important by the Committee. The salary
of the executive officers is generally reviewed annually at the beginning of
each year, with the amount of any increases based on factors such as Company
performance, general economic conditions, marketplace compensation trends and
individual performance.

         Cash bonuses for management are paid under the Company's incentive
bonus plan (the "MIP Plan"). Bonuses under the MIP Plan are computed as a
percentage of year-end base salary. The amount of and entitlement to bonuses
paid under the MIP Plan are based upon the performance of the Company in
comparison to its operating budget. The Committee determines the participants in
the MIP Plan and sets the target bonus levels and performance criteria in the
first quarter of each year.

         Stock Options. The Company grants stock options to certain of its
management employees, based on guidelines that take salary level, tenure,
individual performance rating and importance to the Company into account. Stock
options have been granted at exercise prices equal to the market price on the
date of grant and typically become exercisable in one of two ways (either (i)
based on the financial performance of the Company or (ii) 50% on the third
anniversary of the grant and 50% on the fourth anniversary of the grant), and
expire on the tenth anniversary.
<PAGE>

                                CEO Compensation

     CEO  Compensation.  Mr. Petit has served as the Company's  Chief  Executive
Officer since  October 5, 2000.  Mr.  Petit's  initial  negotiated  compensation
package was  finalized  after  extensive  discussions  between the  Compensation
Committee  and the  executive  search  firm the  Company  engaged  to  assist in
recruiting a new chief  executive  officer as well as with other  candidates for
the position,  and a review of comparative data of selected peer companies.  The
Committee  believes that Mr.  Petit's  package meets the Company's  compensation
goals as stated above.  Mr. Petit's initial annual base salary was $400,000.  In
addition, the Company made a loan to Mr. Petit in the principal sum of $200,000.
The loan bore interest at a rate of 6% per annum and matured on January 1, 2002.
By its terms,  the  principal  and  interest  on the note were to be forgiven at
maturity if Mr. Petit was still  employed by the Company (or his  employment was
previously  terminated  due to his death or  disability)  and, since the date of
issuance of the note,  the  Company's  Common  Stock had traded at a price of at
least $24 share.  The applicable  criteria for forgiveness were met and the note
and accrued  interest  were  forgiven.  Mr.  Petit's  base salary  increased  to
$430,000  effective March 1, 2001 and increased to $451,500  effective March 31,
2002.  These  increases  were based on  available  competitive  information  and
inflation factors. In addition,  on February 16, 2001 and May 24, 2001 Mr. Petit
was granted options to purchase 38,750 shares and 200,000 shares,  respectively,
of the Company's Common Stock.


                Compensation Committee of the Board of Directors

                               Thomas S. Stribling
                                Morris S. Weeden
                               Frederick P. Zuspan

           Compensation Committee Interlocks and Insider Participation

     The  Compensation  Committee  is  responsible  for  executive  compensation
decisions as described above. The Compensation  Committee consisted of Thomas S.
Stribling,  Morris S. Weeden and  Frederick P. Zuspan  during 2001. No member of
the Compensation Committee is currently or has served as an executive officer or
employee of the Company.


<PAGE>


Item 12. Security Ownership of Certain Beneficial Owners and Management

The following table sets forth certain information as to the beneficial
ownership of shares of the Company's Common Stock as of April 1, 2002 by (i) all
stockholders known by the Company to be the beneficial owners of more than five
percent of its Common Stock, (ii) each director of the Company, (iii) each Named
Executive Officer (as hereinafter defined), and (iv) all executive officers and
directors as a group. Unless otherwise indicated, the holders listed below have
sole voting and investment power with respect to all shares beneficially owned
by them.

<TABLE>
<CAPTION>

Name of Beneficial Owner                                     Amount and Nature of Beneficial Ownership     Percent of Class (2)
                                                                                (1)
<S>                                                                         <C>                                 <C>

------------------------------------------------------------ ------------------------------------------- -------------------------
Lord, Abbett & Co. (3)                                                        1,036,149                           11.5%
FMR Corp. (4)                                                                 1,011,800                           11.2%
Fidelity Management & Research Company (4)                                      754,400                            8.3%
Fidelity Small Cap Stock Fund (4)                                               550,900                            6.1%
Edward C. Johnson, III (4)                                                      754,400                            8.3%
Safeco Corporation (5)                                                          956,075                           10.6%
Wellington Management Company, LLP (6)                                          896,100                            9.9%
Vanguard Explorer Fund (7)                                                      553,200                            6.1%
Dimensional Fund Advisors, Inc. (8)                                             568,150                            6.3%
Parker H. Petit (9)                                                             458,686                            5.1%
Jeffrey D. Koepsell (10)                                                         10,500                             -
Frank D. Powers (11)                                                            141,318                            1.5%
George W. Dunaway (12)                                                           15,329                             -
James P. Reichmann (13)                                                          40,338                             -
Guy W. Millner (14)                                                              11,250                             -
Carl E. Sanders (15)                                                             20,625                             -
Thomas S. Stribling (16)                                                          9,500                             -
Jackie M. Ward (17)                                                              18,750                             -
Donald W. Weber (18)                                                             10,000                             -
Morris S. Weeden (19)                                                            21,250                             -
Frederick P. Zuspan (20)                                                         22,879                             -
All current executive officers and directors                                    664,024                            7.4%
as a group (13 persons)
</TABLE>

-- Less than 1%

(1)      Under the rules of the Securities and Exchange Commission (the "SEC"),
         a person is deemed to be a beneficial owner of a security if he or she
         has or shares the power to vote or to direct the voting of such
         security ("voting power") or the power to dispose or to direct the
         disposition of such security ("investment power"). A person is also
         deemed to be a beneficial owner of any securities of which that person
         has the right to acquire beneficial ownership within 60 days as well as
         any securities owned by such person's spouse, children or relatives
         living in the same house. Accordingly, more than one person may be
         deemed to be a beneficial owner of the same securities.

(2)      Based on 8,984,495 shares of Common Stock outstanding on April 1, 2002.
         With respect to each person or group in the table, assumes that such
         person or group has exercised all options, warrants and other rights to
         purchase Common Stock which he or she beneficially owns and which are
         exercisable within 60 days and that no other person has exercised any
         such rights.
<PAGE>

(3)      The number of shares  owned is based on  information  contained  in a
         report on Schedule 13G filed with the SEC on January 12, 2001.
         The address of Lord, Abbett & Co. is 90 Hudson Street, Jersey City,
         New Jersey 07302.

(4)      The address of these beneficial owners is 82 Devonshire Street, Boston,
         Massachusetts 02109. According to a Schedule 13G filed March 11, 2002
         by FMR Corp. ("FMR"), Edward C. Johnson 3rd, Abigail P. Johnson,
         Fidelity Management & Research Company and Fidelity Small Cap Stock
         Fund the ("FMR Schedule 13G"), FMR possesses sole voting power with
         respect to 260,800 shares and sole investment power as to 1,011,800
         shares. FMR is the parent company of Fidelity Management and Research
         Company ("Fidelity") an investment advisor registered under the
         Investment Advisors' Act of 1940, which beneficially owns 754,400
         shares, or 8.613% of the shares outstanding, as a result of acting as
         investment advisor to various investment companies. One of these
         investment companies, Fidelity Small Cap Stock Fund, is the beneficial
         owner of 550,900 shares or 6.29% of the shares outstanding. Edward C.
         Johnson 3rd and FMR, through its control of Fidelity, and the funds
         each has sole power to dispose of 754,400 shares owned by the funds.
         Neither FMR nor Edward C. Johnson 3rd has the sole power to vote or
         direct the voting of the shares owed directly by the funds, which power
         resides with the funds' boards of trustees. Fidelity Management Trust
         Company, a wholly-owned subsidiary of FMR, is the beneficial owner of
         257,400 shares as a result of serving as investment manager to
         institutional accounts, and Edward C. Johnson 3rd and FMR each has sole
         dispositive power over 257,400 shares and sole voting power as to
         257,400 shares owned by such institutional accounts. Members of the
         Edward C. Johnson 3rd family are the predominant owners of the Class B
         shares of common stock of FMR, which class holds approximately 49% of
         the voting power of FMR. Through their stock ownership and the
         operation of a shareholders voting agreement to which they are parties,
         members of the Johnson family may be deemed to form a controlling group
         with respect to FMR under the Investment Company Act of 1940.

(5)      The number of shares owned is based on information contained in a
         report on Schedule 13G filed with the SEC on January 11, 2002. The
         address of Safeco Corporation is Safeco Plaza, Seattle, Washington
         98185.

(6)      The number of shares owned is based on information contained in a
         report on Schedule 13G filed with the SEC on March 31, 2002.  The
         address of Wellington Management Company, LLP ("WMC") is 75 State
         Street, Boston, Massachusetts 02109.  According to its Schedule 13G,
         WMC, in its capacity as investment adviser, may be deemed to
         beneficially own 896,100 shares of the Company's Common Stock, which
         shares are held of record by clients of WMC.  WMC reports that it has
         no power to vote or direct the vote of such shares and shared power to
         dispose or direct the disposition of such shares, while its clients
         have the right to receive, or direct the receipt of, dividends from,
         or proceeds from the sale of, such shares.

(7)      The number of shares owned is based on information contained in a
         report on Schedule 13G filed with the SEC on January 31, 2002.
         According to its Schedule 13G, Vanguard Explorer Fund has the sole
         power to vote or direct the vote of such shares and shared power to
         dispose or direct the disposition of such shares. The address of
         Vanguard Explorer Fund is Post Office Box 2600, Valley Forge,
         Pennsylvania 19482.
<PAGE>

(8)      The number of shares owned is based on information contained in a
         report on Schedule 13G filed with the SEC on January 30, 2002. The
         address of Dimensional Fund Advisors,  Inc. is 1299 Ocean Avenue,
         11th Floor, Santa Monica, California 90401.

(9)      Represents 391,395 shares owned by Mr. Petit, 13,125 shares held by
         Petit Investments Limited Partnership, 2,500 shares held by Petit
         Grantor Trust and 51,666 shares which are subject to purchase upon
         exercise of options exercisable within 60 days.

(10)     Represents 3,000 shares owned by Mr. Koepsell and 7,500 shares which
         are subject to purchase upon exercise of options exercisable within
         60 days.

(11)     Represents 13,692 shares owned by Mr. Powers and 127,626 shares which
         are subject to purchase upon exercise of options exercisable within 60
         days.

(12)     Represents 7,413 shares owned by Mr. Dunaway and 7,916 shares which
         are subject to purchase upon exercise of options exercisable within 60
         days.

(13)     Represents  5,068 shares owned by Mr.  Reichmann  and 35,270  shares
         which are subject to purchase  upon  exercise of options exercisable
         within 60 days.

(14)     Represents  10,000  shares  owned by Mr.  Millner and 1,250  shares
         which are subject to  purchase  upon  exercise of options
         exercisable within 60 days.

(15)     Represents 3,125 shares owned by Mr. Sanders and 17,500 shares which
         are subject to purchase upon exercise of options exercisable within 60
         days.

(16)     Represents  4,500  shares owned by Mr.  Stribling  and 5,000  shares
         which are subject to purchase  upon  exercise of options exercisable
         within 60 days.

(17)     Represents shares which are subject to purchase upon exercise of
         options exercisable within 60 days.

(18)     Represents  5,000  shares  owned by Mr. Weber and 5,000  shares which
         are  subject  to  purchase  upon  exercise  of options exercisable
         within 60 days.

(19)     Represents  3,750  shares  owned by Mr.  Weeden and 17,500  shares
         which are  subject to  purchase  upon  exercise of options
         exercisable within 60 days.

(20)     Represents 217 shares owned by Dr. Zuspan, 125 shares held by Zuspan &
         Associates Partnership, 3,787 shares owned by Dr. Zuspan's wife and
         18,750 shares which are subject to purchase upon exercise of options
         exercisable within 60 days.

Item 13. Certain Relationships and Related Transactions

Mr. Carl E. Sanders, a director of the Company, is also the Chairman of Troutman
Sanders LLP, a law firm based in Atlanta, Georgia, which provided certain legal
services to the Company in fiscal year 2001 and is expected to be retained by
the Company in the future.

<PAGE>

     In 2001, the Company had certain business relationships with MarketRing.com
("MarketRing"),  a privately held company located in the Atlanta area. Mr. Petit
and Mr. Weber are members of the Board of Directors of  MarketRing  and they are
beneficial  owners of approximately  14% and 2%,  respectively,  of MarketRing's
outstanding common stock. In addition,  Carl E. Sanders, Thomas S. Stribling and
Guy W. Millner each own a small percentage (less than 1%) of MarketRing's common
stock.  Pursuant to the  agreements,  Matria  licenses from  MarketRing  certain
software,  and MarketRing  provides  certain  software  development  and website
hosting  services  to the  Company.  Payments  to  MarketRing  in  2001  totaled
$2,182,217.  Hosting and  maintenance  fees payable to  MarketRing  in 2002 will
approximate $450,000.  Future development fees will vary depending on the amount
of development efforts the Company undertakes.

Signature

     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this Form 10-K/A to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                        Matria Healthcare, Inc.

                                        By: /s/ Parker H. Petit
                                        Parker H. Petit, Chairman of the Board,
                                        Chief Executive Officer

Date: April 30, 2002