exv10w1



 







Exhibit 10.1




FIRST AMENDMENT TO THE



ODYSSEY HEALTHCARE, INC.



2001 EQUITY-BASED COMPENSATION PLAN





      THIS FIRST AMENDMENT is made effective as of May 5, 2005 (the “Effective Date”) by Odyssey
Healthcare, Inc., a Delaware corporation (the “Company”).



WITNESSETH:




      WHEREAS, the Company sponsors the Odyssey Healthcare, Inc. 2001 Equity-Based Compensation Plan
(the “Plan”) for the benefit of its eligible employees and their beneficiaries;



      WHEREAS, pursuant to Section 10(c) of the Plan the Board of Directors of the Company (the
“Board”) may amend or alter the Plan without the consent of stockholders or participants, provided
that, any such amendment or alteration, including any increase in any share limitation, shall be
subject to the approval of the Company’s stockholders not later than the annual meeting next
following such Board action if such stockholder approval is required by any federal or state law or
regulation or the rules of The NASDAQ Stock Market, and the Board may otherwise, in its discretion,
determine to submit other such changes to the Plan to stockholders for approval; provided further
that, without the consent of an affected participant, no such Board action may materially and
adversely affect the rights of any participant under any previously granted and outstanding award;



      WHEREAS, pursuant to Section 2(g)(ii) of the Plan, a change in control of the Company may
result from a transition in the members of the Board;



      WHEREAS, the Board believes it is in the best interest of the Company to revise the criteria
for determining when a transition in the members of the Board constitutes a change in control of
the Company;



      WHEREAS, pursuant to Section 4(a) of the Plan, the total number of shares of the Company’s
Common Stock (“Stock”) reserved and available for delivery in connection with awards under the Plan
shall not exceed the lesser of 225,000,000 shares of Stock (as adjusted for previous Stock
dividends) or ten percent (10%) of the total number of shares of Stock outstanding, assuming the
exercise of all outstanding options, warrants or other rights to purchase Stock and assuming the
conversion or exchange or exercise of all other securities convertible into Stock;



      WHEREAS, the Board believes it is in the best interest of the Company to increase the total
number of shares of Stock reserved and available for issuance under the Plan, from inception, to a
total of 6,149,778;



      WHEREAS, Section 5 of the Plan provides that in each fiscal year during any part of which the
Plan is in effect, individuals who may subject the Company to the deduction limitations provided in
section 162(m) of the Internal Revenue Code of 1986, as amended (the



 








 




“Code”) may not be granted awards relating to more than 225,000,000 shares of Stock (as
adjusted for previous Stock dividends);




      WHEREAS, the Board believes it is in the best interest of the Company to provide that in each
fiscal year of the Company, during any part of which the Plan is in effect, individuals who may
subject the Company to the deduction limitations provided in section 162(m) of the Code may not be
granted awards relating to more than 1,300,000 shares of Stock or, in the case of awards the value
of which is not directly related to the value of the Stock, awards the value of which at the time
of payment exceeds $3,000,000;



      WHEREAS, the Plan provides several business criteria on which the grant and/or settlement of
awards may be based if (1) the Company’s Compensation Committee (the “Committee”) determines that
an award to any participant should be so conditioned or (2) the Committee determines that an award
granted to an officer of the Company, who may subject the Company to the deduction limitations of
section 162(m) of the Code, should qualify as “performance-based compensation” for purposes of
section 162(m) of the Code;



      WHEREAS, the Board believes it is in the best interest of the Company to allow the
stockholders of the Company to reapprove the business criteria on which the grant and/or settlement
of awards may be based;



      WHEREAS, Sections 9(c), 9(e) and 10(c) of the Plan provide collectively that upon a change in
control of the Company, the Committee shall have certain powers to modify awards which include the
power to (1) accelerate the vesting schedule associated with any awards, (2) require the mandatory
surrender of options for cash consideration, and (3) make any other such revisions to awards as the
Committee deems appropriate; and



      WHEREAS, the Board believes it is in the best interest of the Company to provide that upon a
change in control of the Company, the Committee shall fully accelerate the vesting schedule
associated with all awards and either require the mandatory surrender of options for cash
consideration or provide that the fully vested options shall be exercisable for a given period and
shall thereafter expire.



      NOW, THEREFORE, the Plan is hereby amended as follows:



      1. Section 2(g)(ii) is hereby amended in its entirety, effective on the Effective Date, to
read as follows:




            (iii) A majority of the members of the Board is replaced during any 12-month
period by directors whose appointment or election is not endorsed by a majority of
the members constituting the Board prior to the date of the appointment or election;



      2. Section 4(a) is hereby amended in its entirety, effective on the Effective Date, to read as
follows:




            (a) Overall Number of Shares Available for Delivery. Subject to
adjustment in a manner consistent with any adjustment made pursuant to
Section 9, the total number of shares of Stock reserved and available for
delivery in connection with Awards under this Plan, from inception, is 6,149,778.



 








 





      3. Section 5 is hereby amended in its entirety, effective on the Effective Date, to read as
follows:




            5. Eligibility; Per Person Award Limitations. Awards may be granted under this
Plan only to Eligible Persons. In each fiscal year during any part of which this
Plan is in effect, a Covered Employee may not be granted Awards relating to more
than 1,300,000 shares of Stock, subject to adjustment in a manner consistent with
any adjustment made pursuant to Section 9, and in the case of Awards the value of
which is not directly related to the value of the Stock, Awards the value of which
at the time of payment exceeds $3,000,000.



      4. Section 8(b) of the Plan shall continue to read in its current state.



      5. Section 9(c) is hereby amended in its entirety, effective on the Effective Date, to read as
follows:




            (c) Corporate Restructuring. If the Company recapitalizes,
reclassifies its capital stock, or otherwise changes its capital structure (a
“recapitalization”), the number and class of shares of Stock covered by an Option
theretofore granted shall be adjusted so that such Option shall thereafter cover the
number and class of shares of stock and securities to which the holder would have
been entitled pursuant to the terms of the recapitalization if, immediately prior to
the recapitalization, the holder had been the holder of record of the number of
shares of Stock then covered by such Option and the share limitations provided in
Sections 4 and 5 shall be adjusted in a manner consistent with the recapitalization.
Upon a Change in Control the Committee, shall fully accelerate the forfeiture
provisions associated with all outstanding Awards and, acting in its sole discretion
without the consent or approval of any holder, effect one of the following
alternatives with respect to Options: (1) accelerate the time at which all Options
then outstanding may be exercised so that such Options may be exercised in full for
a limited period of time on or before a specified date (before or after such Change
in Control) fixed by the Committee, after which specified date all unexercised
Options and all rights of holders thereunder shall terminate, or (2) require the
mandatory surrender to the Company of all of the outstanding Options held by such
holders (irrespective of whether such Options are then exercisable under the
provisions of this Plan) as of a date, before such Change in Control, specified by
the Committee, in which event the Committee shall thereupon cancel such Options and
pay to each holder an amount of cash per share equal to the excess, if any, of the
amount calculated in Section 9(d) (the “Change in Control Price”) of the shares
subject to such Option over the exercise price(s) under such Options for such
shares.



      NOW, THEREFORE, be it further provided that, except as provided above, the Plan shall continue
to read in its current state.



 








 





      IN WITNESS WHEREOF, this First Amendment has been executed by a duly authorized officer of the
Company as of the date set forth in the introductory paragraph and effective as set forth herein.


	 	 	 	 	 
	 	ODYSSEY HEALTHCARE, INC.
a Delaware corporation

 	 
	 	By:  	/s/ Richard R. Burnham
 	 
	 	 	Name:  	Richard R. Burnham 	 
	 	 	Title:  	Chief Executive Officer and President