Document:

EX-4.12

 

Exhibit 4.12

Terms and Conditions of the

ASML Performance Stock Option Plan

for Members of the Board of

Management (Version 2)

(1 of 12)

 

Contents

	 	 	 	 	 	 	 
	ARTICLE 1

	 	DEFINITIONS
	 	 	3	 
	ARTICLE 2

	 	INTERPRETATION
	 	 	5	 
	ARTICLE 3

	 	SCOPE AND OBJECT
	 	 	6	 
	ARTICLE 4

	 	GRANT OF CONDITIONAL OPTIONS
	 	 	6	 
	ARTICLE 5

	 	OPTION PERIOD
	 	 	7	 
	ARTICLE 6

	 	EXERCISE PRICE
	 	 	7	 
	ARTICLE 7

	 	NON-TRANSFERABILITY OF THE OPTION
	 	 	7	 
	ARTICLE 8

	 	EXERCISE OF UNCONDITIONAL OPTIONS
	 	 	7	 
	ARTICLE 9

	 	PERFORMANCE CONDITIONS
	 	 	8	 
	ARTICLE 10

	 	TERMINATION OF EMPLOYMENT
	 	 	8	 
	ARTICLE 11

	 	VARIATION OF CAPITAL
	 	 	9	 
	ARTICLE 12

	 	CHANGE OF CONTROL
	 	 	10	 
	ARTICLE 13

	 	TAX, SOCIAL SECURITY AND COSTS
	 	 	10	 
	ARTICLE 14

	 	PREVENTION OF INSIDER TRADING
	 	 	11	 
	ARTICLE 15

	 	NOTICES
	 	 	11	 
	ARTICLE 16

	 	DISPUTES
	 	 	12	 
	ARTICLE 17

	 	AMENDMENTS
	 	 	12	 

Related documents

In these terms and conditions reference is being made to the ASML Stock Option Plan (version 2) and
the ASML Insider Trading Rules 2005 as amended from time to time (the ‘ASML Insider Trading
Rules’). These documents can be consulted on the ASML Intranet.

(2 of 12)

 

Article 1 Definitions

In the terms and conditions of this Plan and in the related documents, the following terms and
expressions shall have the meanings as set out and below, unless explicitly stated otherwise:

	 	 	 
	Articles of Association

	 	the articles of association of the Company as
amended from time to time;
	 
	 	 
	Board of Management

	 	the board of directors of the Company as mentioned
in Article 13 of the Articles of Association;
	 
	 	 
	Company

	 	ASML Holding N.V., having its registered seat at
De Run 6501, 5504 DR Veldhoven, The Netherlands,
registered with the Chamber of Commerce (Kamer van
Koophandel) of Oost-Brabant under registration
number 17085815;
	 
	 	 
	Conditional Option

	 	an Option which is conditional upon the
achievement of pre-determined Performance
Conditions at the end of the Performance Period
and which becomes an Unconditional Option upon
such achievement;
	 
	 	 
	Date of Grant

	 	the date on which a grant of a Conditional Option
is made in writing to a Participant, which shall
be the date specified in the Option Agreement;
	 
	 	 
	Embargo Period

	 	the period following the Date of Grant as
specified in the Option Agreement, in which a
Conditional or Unconditional Option cannot be
exercised;
	 
	 	 
	Exercise Period

	 	the period following the Embargo Period in which
an Unconditional Option can be exercised in
accordance with Article 8;
	 
	 	 
	Exercise Price

	 	the price at which the Participant may acquire one
Share upon the exercise of one Option, which is
determined in accordance with Article 6;
	 
	 	 
	Expiration Date

	 	the last day of the Option Period, being the last
day on which the Option can be exercised as
specified in the Option Agreement;
	 
	 	 
	General Meeting

	 	the general meeting of shareholders as mentioned
in Article 27 of the Articles of Association;

(3 of 12)

 

	 	 	 
	Group Company

	 	an affiliated company of ASML, in which the
affiliation is determined by section 24c of Book 2
of the Dutch Civil Code, irrespective of the
jurisdiction of such company and irrespective of
the place where it has its registered office;
	 
	 	 
	Option

	 	a right granted by the Company to the Participant
to acquire one Share during the Exercise Period
against payment of the Exercise Price. Options
granted to United States residents or citizens
will give such Participants the right to acquire
Shares quoted on the NASDAQ while Options granted
to all other Participants will give the right to
acquire Shares quoted on the Euronext;
	 
	 	 
	Option Agreement

	 	the signed written agreement, including all
annexes thereto, between the Participant and the
Company, setting forth the terms and conditions of
the Options;
	 
	 	 
	Option Period

	 	the period in which the Option remains valid
beginning on the date of Grant and ending on the
Expiration Date as specified in the Option
Agreement;
	 
	 	 
	Option Rules

	 	the ASML Stock Option Plan (version 2) including
any modifications subsequently introduced therein
in conformity with the same, on which this Plan is
based;
	 
	 	 
	Participant

	 	a member of the Board of Management to whom a
grant of a Conditional Option has been made under
the terms and conditions of this Plan or, upon
death, the heirs of such member of the Board of
Management;
	 
	 	 
	Performance Conditions

	 	the performance conditions attached to the grant
of a Conditional Option as set out in the annex to
the Option Agreement;
	 
	 	 
	Performance Period

	 	the period of one (1) calendar year which is the
financial year in which the Conditional Option is
granted, over which period the fulfillment of the
Performance Condition is measured in accordance
with Article 9;
	 
	 	 
	Plan

	 	the terms and conditions of the ASML Performance
Stock Option Plan for Members of the Board of
Management including the Award Agreement and the
Confirmation Letter of Release as amended from
time to time in accordance with the provisions
hereof;

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	Remuneration Policy

	 	the remuneration policy for the Board of
Management of ASML Holding N.V. as adopted by the
General Meeting of Shareholders as amended from
time to time, and in respect of a grant of
Conditional Options, the remuneration policy as
applicable at the respective Date of Grant;
	 
	 	 
	Scheme Audit

	 	objective determination of the fulfillment of the
Performance Conditions at the end of the
Performance Period by the Company’s auditor or an
independent expert appointed by the Supervisory
Board;
	 
	 	 
	Share

	 	an ordinary share in the capital of the Company,
having a nominal value of EUR 0.02 (two eurocents)
or any other nominal value such Share may have in
the future;
	 
	 	 
	Stock Exchange

	 	the stock exchange of Euronext Amsterdam NV, The
Netherlands, or the NASDAQ Stock Market New York
City, New York, United States of America;
	 
	 	 
	Supervisory Board 

Unconditional Option

	 	the board of supervisory directors of the Company
as mentioned in Article 20 of the Articles of
Association; and 

a Conditional Option which has become
unconditional as a result of the achievement of
the Performance Conditions and which will become
exercisable after expiration of the Embargo
Period.

Article 2 Interpretation

Words or expressions used in the Plan shall where appropriate:

	(i)	 	when denoting the masculine gender include the feminine and vice versa;
	 
	(ii)	 	when denoting the singular include the plural and vice versa;
	 
	(iii)	 	when referring to any enactment be construed as a reference to that enactment as for the
time being consolidated, amended, re-enacted or replaced and shall include any regulations
made there under;
	 
	(iv)	 	when a period of time is specified and starts from a given day or the day of an act or event
or ends on a given day, be calculated inclusive of that day;
	 
	(v)	 	be construed such that the headings and sub-headings are for ease of reference only, and do
not affect the interpretation of any Article;
	 
	(vi)	 	when referring to any enactment or regulations under Dutch law be construed at the discretion
of the Supervisory Board as a reference to other applicable laws or regulations of any other
country (or region of a country); and

(5 of 12)

 

	(vii)	 	references to tax and/or social security contributions and/or withholding taxes shall for
the avoidance of doubt include The Netherlands and any other jurisdiction to which a
Participant may be subject.

Article 3 Scope and Object

This Plan is part of the Option Rules and contains the terms and conditions that are applicable to
the Participant pursuant to Article IV of the Option Rules.

The Participant is aware of the fact that the value of the Shares may fluctuate, and that the
Company does not guarantee that the Participant will derive any benefit from the Options granted
under this Plan.

Nothing in this Plan or related documents by themselves or in combination shall be construed as an
expressed or implied contract of employment or a guarantee of continued future employment.

Article 4 Grant of Conditional Options

	4.1	 	A grant of Conditional Options can be made in accordance with the Remuneration Policy and the
terms and conditions set forth in this Plan, on an annual basis and in accordance with a
consistent policy regarding frequency, timing and terms and conditions, and subject to the
ASML Insider Trading Rules and applicable mandatory provisions regarding insider trading, as
amended from time to time.
	 
	4.2	 	Each grant shall be evidenced by an Option Agreement concluded between the Participant and
the Company, setting forth the terms and conditions pertaining to such grant. By signing the
Option Agreement the Participant acknowledges that he has read the Plan and the ASML Insider
Trading Rules and declares that he fully understands and will fully comply with the provisions
of the Plan and the ASML Insider Trading Rules.
	 
	4.3	 	An Option Agreement shall specify, inter alia, the number of Conditional Options granted, the
Date of Grant, the Option Period, the Embargo Period, the Exercise Period, the Exercise Price,
the Performance Condition, the Performance Period and all such other information as required
by the terms and conditions of this Plan.
	 
	4.4	 	If the Participant wishes to participate in the Plan, he is required to return a signed copy
of the Option Agreement to the Company within thirty (30) calendar days following the date on
which the Option Agreement has been signed by the Company as stated in the Option Agreement.
Option Agreements signed and returned before the due date will be considered accepted by the
Participant on the date the Option Agreement has been signed by the Company.
	 
	4.5	 	Except for the payment provisions as set out in Article 13, no consideration shall be payable
by a Participant for the grant of a Conditional Option made for his benefit.

(6 of 12)

 

Article 5 Option Period

	5.1	 	The Option Period shall be ten (10) years as from the Date of Grant as specified in the
Option Agreement.
	 
	5.2	 	Unconditional Options may only be exercised within the Exercise Period following the expiry
of the Embargo Period as specified in the Option Agreement in accordance with the provisions
of Article 8 of this Plan.
	 
	5.3	 	Unconditional Options that have not been within the Exercise Period shall lapse on the day
following the Expiration Date and become null and void.
	 
	5.4	 	Notwithstanding the provisions of paragraphs 1 through 3 of this Article 5, the Option Period
may be extended under the circumstances as referred to in Article 10.5 by a maximum period of
twelve (12) months.

Article 6 Exercise Price

The Exercise Price shall be equal to the closing price ‘cum dividend’ of a Share on the Stock
Exchange on the Date of Grant. For United States residents or citizens, the EUR (euro) denominated
Exercise Price will be converted into a USD (United States dollar) Exercise Price by taking the
Exercise Price defined in the first sentence of this Article and applying the EUR–USD exchange rate
fixing on the Date of Grant as performed by the European Central Bank at or around 14.00 hours
C.E.T.

Article 7 Non-transferability of the Option

The Option granted is strictly personal and non-transferable. No Option shall be capable of being
sold, transferred or assigned by the Participant other than in a manner specified in the Plan and
the Option cannot be charged, pledged, encumbered or otherwise used for the purpose of creating
security title or interest of whatever nature.

Article 8 Exercise of Unconditional Options

	8.1	 	Notwithstanding the provisions of Article 10, the Unconditional Options are exercisable at
any time during the Exercise Period, provided that the Participant is employed by the Company
or any Group Company at the last day of the Embargo Period.
	 
	8.2	 	The Unconditional Options may be exercised only in accordance with established ASML
procedures existing at the time of exercise.
	 
	8.3	 	When exercising the Unconditional Options the Participant must comply with the ASML Insider
Trading Rules, as in force at the time of exercise.

(7 of 12)

 

	8.4	 	The Unconditional Options may be exercised by the Participant for the total number which has
vested or in tranches of 100 or multiples thereof (with the exception of the last tranche),
with the provision that each exercise must take place within the Exercise Period, provided
such exercise is not in conflict with the provisions of Article 14.

Article 9 Performance Conditions

	9.1	 	In accordance with the Remuneration Policy, the Supervisory Board shall have the authority
and complete discretion to impose Performance Conditions, being conditions and limitations in
addition to any conditions and limitations contained in this Plan which must be achieved at
the end of the Performance Period in order for the Conditional Option to vest and become an
Unconditional Option, provided that such additional conditions and limitations shall:

	 	(i)	 	be objective and are specified in the Option Agreement; and
	 
	 	(ii)	 	be such that the grant of the Option after the Scheme Audit and the
fulfillment or attainment of any Performance Conditions and limitations so specified
shall not be dependent upon the further discretion of any person, other than the
determination by the Supervisory Board that such conditions or limitations have been
fulfilled based on the Scheme Audit; and
	 
	 	(iii)	 	not be capable of amendment, variation or waiver unless a major change in
the organization and/or the market and/or business circumstances occurs which causes
the Supervisory Board to consider that a waived, varied or amended condition would be
a fairer measure of performance and would not be more difficult nor easier to satisfy
than any existing additional conditions.

	9.2	 	Where necessary or desirable for the administration of the Plan, the Supervisory Board shall
establish operating guidelines regarding, inter alia, the Performance Conditions and the
procedure for arranging, operating and completing the Scheme Audit.
	 
	9.3	 	Promotion, demotion or transfers within the Company or Group Company of a Participant at any
time during the Performance Period shall not affect any Option nor shall it affect the
fulfillment of the Performance Conditions attached to any Option granted.

Article 10 Termination of employment

	10.1	 	Notwithstanding the provisions of Article 10.2, if a Participant ceases to be employed with
the Company or with a Group Company during the Performance Period, the number of Conditional
Options that become Unconditional Options shall be the number of Options that is related to
the fulfillment of the Performance Conditions over the relevant Performance Period, multiplied
by a factor reflecting the period in which the Participant was employed within the Group
during the Performance Period. This factor is calculated by dividing the period of actual
employment during the Performance Period in terms of months, rounded up to the nearest whole
month, by the total Performance Period, in terms of months. The Embargo Period for the
Conditional Options which have become Unconditional Options in accordance with this Article
10.1 shall end on the day following the last day of the Performance Period.

(8 of 12)

 

	10.2	 	If a Participant is given notice of termination of employment in circumstances involving
fraud, gross negligence, willful misconduct or any other activity detrimental to the Company
or Group Company, all outstanding Options, whether Conditional or Unconditional, shall
immediately lapse and become null and void on the date that such notice of termination of
employment is given. These Options will become null and void without the Participant being
entitled to any compensation in this respect from the Company or Group Company.
	 
	10.3	 	If a Participant dies during the Performance Period or ceases to be employed with the Company
or with a Group Company during the Performance Period as a result of disability or incapacity
to act, the number of Conditional Options that become Unconditional Options shall be fixed at
the number of Options linked to Target Achievement as defined in the annex to the Option
Agreement; multiplied by a factor reflecting the period in which the Participant was employed
with the Company and/or with a Group Company during the Performance Period. This factor is
calculated in accordance with Article 10.1. Notwithstanding the application of such pro-rated
calculation, the Supervisory Board in its absolute discretion may (i) waive the application of
this pro-rated calculation method and determine that a number up to and including the maximum
number of Conditional Options as mentioned in the Option Agreement shall vest and become
Unconditional Options, and/or (ii) decide that the Embargo Period for the Conditional Options
which have become Unconditional Options in accordance with this Article 10.3 shall end on the
day following the last day of the Performance Period.
	 
	10.4	 	If a Participant dies after the Performance Period or ceases to be employed with the Company
or with a Group Company after the Performance Period as a result of disability or incapacity
to act, any Unconditional Options shall be exercisable during (A) the period from the date of
termination of employment until the Expiration Date, or (B) the period from the date of
termination of employment until the date which is twelve (12) months following the date of
termination of employment, whichever period is the longest.
	 
	10.5	 	If employment ceases, for reasons other than those mentioned in Article 10.2 or 10.4, at any
time following the end of the Performance Period, any Unconditional Options will become
exercisable after the date of termination of employment.

Article 11 Variation of capital

	11.1	 	Subject to Article 12, in the event of a share split, reverse share split, any capitalization
issue (other than a capitalization issue in substitution for, or as an alternative to, a cash
dividend), or rights issue or rights offer or any reduction, sub-division, consolidation or
other variation of the capital of the Company affecting the number of Options in issue
(including any change in the currency in which Options are denominated), the number of Options
subject to any grant may be adjusted by the Company without prejudice (including retrospective
adjustments where appropriate) in such manner as the Company considers to be in its opinion
fair and reasonable, however, in no event shall the Company be obliged to make such
adjustment.

(9 of 12)

 

	11.2	 	Notice of any adjustment shall be given by the Company to those Participants affected by such
adjustment.

Article 12 Change of control

	12.1	 	Subject to the Articles of Association, required approval of the General Meeting and any
applicable laws, in the event of the Company’s dissolution, liquidation, sale of all or
substantially all of its assets, merger, split, consolidation or similar transaction, change
in control or share-for-share exchange, the Supervisory Board shall have the power to:

	 	(i)	 	adjust the number of Options to the number of Options linked to Target
Achievement as mentioned in the annex to the Option Agreement; and/or
	 
	 	(ii)	 	determine that Options become exercisable at the date of change of control
or at the date of termination of employment which results from such change of
control, or
	 
	 	(iii)	 	provide, at the request of the Participant, for the payment of an amount
in cash equal to the benefit at exercise that the Participant could have received if
he had exercised the Options at the date of change of control; or
	 
	 	(iv)	 	take whatever other steps the Supervisory Board considers appropriate.

	12.2	 	All adjustments and/or payments described in Article 12.1 sub (i), (ii) and (iii) shall be
made by the Supervisory Board and shall be checked and approved by an independent advisor.
Such approval shall be conclusive and binding on all persons.
	 
	12.3	 	Except as expressly provided in this Article 12, no Participant shall be afforded any rights
by reason of any capital or corporate reorganization of the Company. Any new Options or
replacement of Options shall not affect any grants previously effected under the Plan.
	 
	12.4	 	A grant effected pursuant to the Plan shall not affect in any way the right or power of the
Company to effect any capital or corporate reorganization.
	 
	12.5	 	If a corporate event occurs constituting a change of control of a Group Company due to which
the Participant is no longer employed within the Group, the Supervisory Board can at its
absolute discretion provide for any adjustments or payments as deemed appropriate such as,
inter alia, continuation of the Plan or settlement of the outstanding grants of the
Participant immediately prior to such corporate event.

Article 13 Tax, social security and costs

	13.1	 	All applicable personal tax and employee social security contributions as a result of or in
respect of the implementation of the Plan shall be borne by the Participant.
	 
	13.2	 	It shall be the obligation of the Company to issue or to procure the grant of the Options to
the Participant and the Participant shall permit the Company or any Group Company to withhold
and account for an amount equal to any wage or income tax, employee’s social

(10 of 12)

 

	 	 	security contributions liability and any other liabilities for which the Company or a
Group Company as the case may be, has an obligation to withhold and account.

	13.3	 	Whenever Options are to be granted under the Plan, the Company or any Group Company may
require the Participant to remit to the Company or a Group Company or upon the request of the
Participant to deduct as a one-off payment from the net salary or the net annual bonus (if
any) of the Participant, an amount sufficient to satisfy all withholding tax requirements at
the time of the exercise, including, but not limited to, the withholding of wage tax, income
tax and social security contributions.
	 
	13.5	 	The Plan is based on the applicable tax and social security legislation and regulations
prevailing at the Adoption Date. If any tax and/or social security legislation or regulations
are amended after the Adoption Date and any tax or employee social security levies become
payable, the costs and risks related thereto shall be borne by the Participant.
	 
	13.6	 	For the avoidance of doubt, the provisions of Articles 13.1 to 13.5 shall apply to a
Participant’s liabilities that may arise on the exercise in more than one jurisdiction.
	 
	13.7	 	The Participant shall be liable for all costs relating to the exercise of the Option
including but not limited to costs charged by stock brokers in connection with the Share
acquired following the exercise of the Option and subsequent sale of such Share.
	 
	13.8	 	Costs relating to the issue of new and/or transfer of existing Shares following the exercise
of the Option shall be for the account of the Company.

Article 14 Prevention of Insider Trading

The Participant who signs the Option Agreement shall at the same time be deemed to accept the
applicable ASML Insider Trading Rules and to act accordingly.

Article 15 Notices

	15.1	 	Notices which must be given by the Company to the Participant pursuant to or in connection
with the Option Rules and/or the Plan shall be regarded as correctly addressed if sent to the
address of the Participant as recorded in the Human Resources and Organization Staff Records
Department of the Company or any other address as may appear to the Company to be appropriate,
or by e-mail message or in any other format agreed in advance between the Participant and the
person giving the notice on behalf of the Supervisory Board.
	 
	15.2	 	Any notice or other document required to be given to the Company or the Supervisory Board
shall be delivered in a format agreed in advance between the Participant and the person
receiving the notice. Notices sent by post, unless received earlier, shall be deemed to have
been given on the fifth day following the date of posting.

(11 of 12)

 

Article 16 Disputes

	16.1	 	The Option Rules, the Plan, the Option Agreement including the annex thereto, and all further
documents relating to the Option Rules and/or the Plan shall be governed by the laws of The
Netherlands.
	 
	16.2	 	All disputes arising from the Option Rules, the Plan, the Option Agreement including the
annex thereto and other documents relating to the Option Rules and/or the Plan, shall in the
first instance, be settled by the District Court of Eindhoven.

Article 17 Amendments

	17.1	 	The Supervisory Board shall have the power to amend the Option Rules and/or the Plan or add
further provisions to the same at any time.
	 
	17.2	 	The Participant shall be informed in writing of any amendments or measures as referred to in
this Article.

* * * * *

(12 of 12)a5440515ex10_1.htm

    Exhibit
      10.1

     

    
      AGREEMENT

       

      THIS
        AGREEMENT (the “Agreement”), dated as of June
        29, 2007 (the “Effective Time”), is made and
        entered into by and among Odyssey HealthCare, Inc., a Delaware corporation
        (the
“Company”), and Deborah A. Hoffpauir
        (“Employee”).

       

      W
        I T N E S S E T H:

       

      WHEREAS,
        Employee and the Company are party to that certain Employment Agreement of
        Deborah A. Hoffpauir, made and entered into as of August 1, 2005 (the
“Employment Agreement”), a true and correct
        copy of which is attached hereto as Exhibit A;

       

      WHEREAS,
        Employee has announced her resignation as Senior Vice President and Chief
        Operating Officer of the Company (the
“Resignation”), and Employee and the Company
        have mutually agreed that such resignation will be effective on the earlier
        to
        occur (such date, the “Resignation Effective
        Time”) of (i) the Company’s employment of a Chief Operating
        Officer to replace Employee in such position or (ii) July 1, 2007;

       

      WHEREAS,
        the Company and Employee have mutually agreed to the termination of the
        Employment Agreement, without further rights or obligations of either party
        under the Employment Agreement (except to the extent that any such rights
        or
        obligations are expressly incorporated herein), effective as of the Effective
        Time;

       

      WHEREAS,
        upon the termination of the Employment Agreement, (i) the Company desires
        to
        retain the services of Employee, and Employee desires to be employed by the
        Company as an at-will employee and to continue to serve as Senior Vice President
        and Chief Operating Officer of the Company until the Resignation Effective
        Time
        and (ii) following the Resignation Effective Time, the Company desires to
        continue to retain the services of Employee, and Employee desires to remain
        employed by the Company as an at-will employee and to continue to serve as
        Regional Vice President of the Company’s Southeast Region, in the case of
        clauses (i) and (ii), upon the terms and conditions set forth in this Agreement;
        and

       

      WHEREAS,
        each capitalized term used but not otherwise defined herein shall have the
        meaning given such term in the Employment Agreement.

       

      NOW,
        THEREFORE, in consideration of the mutual covenants, agreements, and promises
        set forth herein, and for other good a valuable consideration, the receipt
        and
        sufficiency of which are hereby acknowledged, Employee and the Company hereby
        agree as follows:

       

      1.  Acknowledgement;
        Termination of Employment Agreement.  The parties hereby
        represent and warrant that prior to the Effective Time, Employee’s employment
        relationship with the Company was pursuant to and governed solely by the
        Employment Agreement.  Effective as of the Resignation Effective Time,
        Employee resigns as Senior Vice President and Chief Operating Officer of
        the
        Company and as an officer of the Company’s subsidiaries, including, without
        limitation, Odyssey HealthCare Holding Company, Odyssey HealthCare GP, LLC,
        Hospice of the Palm Coast, Inc., Odyssey HealthCare Management, LP, Odyssey
        HealthCare Operating A, LP, Odyssey HealthCare Operating B, LP, and Odyssey
        HealthCare Foundation. In connection with Employee’s resignation, the parties
        hereby agree that the Employment Agreement is hereby terminated in full as
        of
        the Effective Time, except as set forth in Section 4,
        without any further action on the part of the Company or Employee and, except
        as
        set forth in Section 4, thereafter
        shall be of no further force or effect.  From and after the date of
        termination of the Employment Agreement, Employee shall not be entitled to
        receive any further wages, compensation, or benefits arising pursuant to
        the
        Employment Agreement, and neither the Company nor Employee shall have any
        rights
        or obligations thereunder, other than as provided in Section 4.  Employee
        agrees to execute all further documents which the Company may reasonably
        request
        of her to effectuate such resignations.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      2.  Continued
        Services.

       

      (a)  At
        Will Employment.  Effective as of the Effective Time, and
        subject to such terms and conditions as are set forth in this Agreement,
        the
        Company hereby retains Employee as an employee to perform such services on
        behalf of the Company as set forth herein or as may be mutually agreed to
        in
        writing by the Company and Employee, and Employee hereby accepts such employment
        from the Company.  Until the Resignation Effective Time, Employee
        shall serve as Senior Vice President and Chief Operating Officer of the Company,
        and shall have such powers and duties (including holding officer positions
        with
        one or more Subsidiaries of the Company) as may be assigned from time to
        time by
        the Board of Directors of the Company (the
“Board”).  Following the Resignation
        Effective Time, Employee shall no longer serve as Senior Vice President and
        Chief Operating Officer of the Company, but shall serve as Regional Vice
        President of the Company’s Southeast Region, and shall have such powers and
        duties as may be assigned from time to time by the President or the Chief
        Operating Officer of the Company.  The Company has the right to
        terminate the Employee’s employment under this Section 2(a)
        at will (for any reason or no reason), and, in the event the Company exercises
        such right of termination, the Company shall pay to Employee any compensation
        or
        benefits due Employee pursuant to Section 2(b)
        and Section 2(c),
        if applicable, through and including the date of such termination, and
        thereafter the Company shall have no further obligation to Employee hereunder
        or
        otherwise, except as required by the Consolidated Omnibus Budget Reconciliation
        Act (“COBRA”) or other applicable
        law.

       

      (b)  Employee
        Compensation and Benefits.

       

      (i)  Annual
        Base Salary.  Employee shall receive an annual base salary
        (“Annual Base Salary”) which shall be paid
        bi-weekly in accordance with customary payroll practices of the
        Company.  Employee’s Annual Base Salary shall be $335,000.00 per year
        until December 31, 2007.  Effective January 1, 2008 and thereafter for
        so long as Employee remains in the employ of the Company, subject to any
        increases or decreases in salary as the President in his discretion from
        time to
        time shall deem appropriate, Employee’s Annual Base Salary shall be $183,000.00
        per year.

       

      (ii)  Pro-Rated
        2007 Annual Bonus.  Employee shall be entitled to receive an
        annual bonus for 2007 for her service as Senior Vice President and Chief
        Operating Officer from January 1, 2007 through the Resignation Effective
        Time.  Such bonus shall be a pro-rated amount equal to the product of
        (i) the amount of the annual bonus, if any, to which Employee would have
        been
        entitled for calendar 2007 if Employee had not resigned as Senior Vice President
        and Chief Operating Officer of the Company, multiplied by (ii) a
        fraction, the numerator of which is the number of days that have elapsed
        since
        January 1, 2007 through (but not including) the Resignation Effective Time,
        and
        the denominator of which is the total number of days in 2007.  Such
        bonus shall be paid at such time as the Company pays the executives of the
        Company annual bonuses for the 2007 calendar year (but in no event later
        than
        the fifth business day after the Company publicly announces its earnings
        for
        such calendar year in a press release), whether or not Employee is then employed
        by the Company.  Except for the foregoing bonus, Employee shall not be
        entitled to receive any other bonus from the Company for the 2007 calendar
        year.
 Effective January 1, 2008 and thereafter for so long
        as Employee remains in the employ of the Company as one of its Regional Vice
        Presidents, Employee shall be eligible to participate in such bonus programs
        established by the Company from time to time for its Regional Vice
        Presidents. 

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

         

      

      (iii)  Benefits.  The
        Company agrees to provide Employee with such health insurance and other benefits
        as are generally made available to the Company’s common law employees for so
        long as Employee remains in the employ of the Company.

       

      (c)  Guaranteed
        Salary Payment.  If the Company terminates Employee’s
        employment on or prior to December 31, 2007 for any reason other than Cause,
        Employee shall be entitled to continue to receive the compensation described
        in
Section 2(b)(i)
        through December 31, 2007, payable as described in Section 2(b)(i).

       

      (d)  Withholding.  The
        Company may withhold from any amounts payable under this Agreement such Federal,
        state or local taxes as shall be required to be withheld pursuant to any
        applicable law or regulation.

       

      
        (e)  Notice
          of Termination.  Any termination by the Company for any or no
          reason, or by Employee’s resignation, shall be communicated by Notice of
          Termination to the other party hereto given in accordance with Section 6(a).  For
          purposes of this Agreement, a “Notice of Termination” means a written notice
          which, to the extent applicable, sets forth in reasonable detail the facts
          and
          circumstances that provide a basis for termination of Employee’s
          employment.  The failure by the Company to set forth in the Notice of
          Termination any fact or circumstance which contributes to a showing of
          Cause
          shall not waive any right of the Company hereunder or preclude the Company
          from
          asserting such fact or circumstance in enforcing the Company’s rights
          hereunder.

         

      

      3.  Equity
        Awards and Agreements.  Employee hereby represents and
        warrants that, except for the equity award agreements described in Exhibit
        B hereto (the “Equity Agreements”), she is
        not a party to any stock option, stock appreciation right, restricted stock,
        or
        similar agreement granting Employee the right to acquire or benefit from
        the
        appreciation in value of the capital stock of the Company or any of its
        subsidiaries.  Except for the Retained Awards (as
        defined below), Employee and the Company hereby agree that, notwithstanding
        any
        contrary provision in the Equity Agreements, all stock options, restricted
        shares, and/or other equity awards granted to Employee pursuant to the Equity
        Agreements shall immediately be terminated and of no further force or
        effect.  Concurrently with the execution of this Agreement, Employee
        and the Company are entering into an Equity Award Termination Agreement,
        Release
        and Waiver (the “Termination Agreement”)
        terminating all Equity Agreements, except the Retained Awards.  As
        used in this Agreement, “Retained Awards” means
        the (i) the Nonstatutory Stock Option Agreement, dated November 20, 2002,
        representing the right to acquire 20,000 shares of the Company’s common stock
        (45,000 shares after the Company’s three-for-two stock splits on February 6,
        2003 and July 28, 2003), of which options to acquire 45,000 shares are
        exercisable as of July 1, 2007, (ii) the Nonstatutory Stock Option Agreement,
        dated June 20, 2003, representing the right to acquire 75,000 shares of the
        Company’s common stock (112,500 shares after the Company’s three-for-two stock
        split on July 28, 2003), of which options to acquire 112,500 shares are
        exercisable as of July 1, 2007, (iii) the Nonstatutory Stock Option
        Agreement, dated January 26, 2004, representing the right to acquire 75,000
        shares of the Company’s common stock, of which options to acquire 75,000 shares
        are exercisable as of July 1, 2007, (iv) the Restricted Stock Award Agreement,
        dated November 18, 2004, representing the right to receive 30,000 shares
        of the
        Company’s common stock, par value $0.001 per share, and (v) the Nonstatutory
        Stock Option Agreement, dated November 16, 2005 (the “November
        2005 Option”), representing the right to acquire 90,000 shares
        of the Company’s common stock, of which options to acquire 22,500 shares are
        exercisable as of July 1, 2007; provided, however, that with
        respect to the November 2005 Option, the option shares which are not exercisable
        as of July 1, 2007 shall be forfeited as set forth in the Termination Agreement.
        

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

         

      

      4.  Survival
        of Specified Provisions in the Employment Agreement.  The
        following provisions of the Employment Agreement are incorporated herein
        by
        reference, shall survive the Effective Time, and shall continue in full force
        and effect, as such provisions may be amended by this Section 4,
        notwithstanding any other provision of this Agreement:

       

      (a)  All
        definitions contained in the Employment Agreement and used in this Agreement
        (including the provisions of the Employment Agreement incorporated by reference
        herein), except that:

       

      (i)  All
        references to “Agreement” in Sections 9 and 10 of the Employment Agreement shall
        now refer to this Agreement; and

       

      (ii)  The
        definition of “Competing Business” as used in the Employment Agreement is hereby
        amended and restated in its entirety as follows:

       

      “Competing
        Business” means any business that provides hospice care or
        services to terminally ill patients.

       

      (iii)  The
        definition of “Date of Termination” as used in the
        Employment Agreement is hereby amended and restated in its entirety as
        follows:

       

      “Date
        of Termination” means (i) if Employee’s employment is
        terminated by reason of Employee’s death, the date of Employee’s death; (ii) if
        Employee’s employment is terminated by the Company for any or no reason, the
        date specified in the Notice of Termination or, if no date is specified,
        the
        date on which the Company notifies Employee that Employee’s employment by the
        Company is terminated; or (iii) if Employee’s employment is terminated by
        Employee, the date specified in the Notice of Termination or agreed to by
        the
        Company and Employee.

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

         

      

      (b)  Section
        9
        of the Employment Agreement (“Confidential Information; Ownership of Property”),
        except that the first sentence of Section 9(a)(i) of the Employment Agreement
        is
        hereby amended and restated in its entirety as follows:

       

      Employee
        acknowledges that the Company has trade, business and financial secrets and
        other confidential and proprietary information regarding the Company and
        its
        business, in whatever form, tangible or intangible (collectively, the
“Confidential Information”), and that, during
        the course of Employee’s employment with the Company, Employee has received,
        shall receive or be placed in a position to have access to or develop
        Confidential Information.

       

      (c)  Section
        10
        of the Employment Agreement (“Non-Competition; Non-Solicitation;
        Non-Disparagement”); except that Section 10(a) of the Employment Agreement is
        hereby amended and restated in its entirety as follows:

       

           (a)
        For the reasons and consideration specified in Section 8 of the
        Employment Agreement, which reasons continue to be valid and which consideration
        Employee acknowledges was provided as set forth in that Section 8 and
        which Employer agrees will continue to be provided in the future, Employee
        hereby covenants and agrees that:

      

      (i)
        for a
        period of two years from the Effective Time, Employee shall not serve as
        an
        executive, general manager, executive director, director, officer, consultant,
        or any other capacity that has duties and responsibilities identical or
        substantially similar to the those of the position of Senior Vice President
        or
        Chief Operating Officer for any Competing Business that operates in any city
        (including the 50-mile radius surrounding such city) in which the Company,
        or
        any of its Subsidiaries, has a facility that engages in its respective business
        as of the Effective Time.

      

      (ii)
        during her employment with Company and for a period of one year following
        the
        Date of Termination, Employee shall not:

      

           (A)  
        serve as an executive, general manager, executive director, director, officer,
        consultant, or any other capacity that has duties and responsibilities identical
        or substantially similar to those of the position of Regional Vice President
        of
        the Southeast Region for any Competing Business that operates in any city
        (including the 50-mile radius surrounding such city) in the Company’s Southeast
        Region in which the Company or any of its Subsidiaries has a facility that
        engages in its respective business as of the Effective Time.

      

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

         

      

           (B)  
        recruit, hire, assist in hiring, attempt to hire, or contact or solicit with
        respect to hiring any Person who, at any time during the 12 month period
        preceding the Date of Termination, was an employee of the Company or any
        of its
        Subsidiaries, provided that Employee may hire any individual who is employed
        as
        an administrative assistant or clerical employee as of the Date of
        Termination;

      

           (C)  
        induce or attempt to induce any employee of the Company, or any of its
        Subsidiaries, to terminate, or in any way interfere with, the relationship
        between the Company, or any of its Subsidiaries, and any employee thereof;
        or

      

                          
        (D)  induce or attempt to induce any current or prospective customer,
        client, patient, supplier, service provider, or other business relation of
        the
        Company, or any of its Subsidiaries, who was served or solicited by Employee
        during the term of Employee’s employment to cease doing business with the
        Company, or any of its Subsidiaries, or in any way interfere with the actual
        or
        prospective relationship between the Company, or any of its Subsidiaries,
        and
        any such individual or entity.

       

      Except
        as
        otherwise specifically provided in this Section 4,
        all of the parties’ rights and obligations under the Employment Agreement are
        extinguished upon the effectiveness of this Agreement.

       

      5.  General
        Release and Covenant Not to Sue.

       

      (a)  Employee,
        on behalf of herself and her family, attorneys, heirs, estate, agents,
        executors, representatives, administrators and each of their respective
        successors and assigns (collectively, the “Employee
        Parties”), hereby generally releases and forever discharges
        the Company and its predecessors, successors, assigns, parents, subsidiaries
        and
        affiliates and each of the foregoing entities’ respective past, present and
        future shareholders, members, partners, managers, directors, officers,
        employees, agents, representatives, principals, insurers, attorneys, employee
        benefit programs (and the trustees, administrators, fiduciaries and insurers
        of
        such programs), and any person acting by, through, under or in concert with
        any
        of the foregoing entities (collectively, the “Company
        Parties”) from any and all claims, complaints, charges,
        demands, liabilities, suits, damages, losses, expenses, attorneys’ fees,
        obligations or causes of action (“Claims”),
        known or unknown, of any kind and every nature whatsoever, and whether or
        not
        accrued or matured, which any of them may have, arising out of or relating
        to
        any transaction, dealing, relationship, conduct, act or omission, or any
        other
        matters or things occurring or existing at any time prior to and including
        the
        Effective Time (including, but not limited to, any Claims against any of
        the
        Company Parties based on, relating to or arising under wrongful discharge,
        retaliation, breach of contract (whether oral or written), tort, fraud,
        defamation, slander, breach of privacy, violation of public policy, negligence,
        promissory estoppel, Title VII of the Civil Rights Act of 1964, The Age
        Discrimination in Employment Act, The Americans with Disabilities Act, the
        Employee Retirement Income Security Act of 1974, or any other federal, state
        or
        local law relating to employment (or unemployment), the payment of wages,
        salary
        or other compensation, civil or human rights, discrimination in employment
        (based on age or any other factor), or raised by that certain letter dated
        January 4, 2007, from Kenneth C. Broodo, on behalf of Employee, to Robert
        Lefton,) in all cases arising out of or relating to Employee’s employment by the
        Company or any subsidiary thereof or Employee’s investment in the Company or any
        subsidiary thereof or her services as an officer or employee of the Company
        or
        any subsidiary thereof, or otherwise relating to the termination of such
        employment or services; provided, however, that this release will
        not limit or release (i) Employee’s rights under this Agreement or Employee’s
        rights under the Employment Agreement that survive the Effective Time and
        are
        expressly identified and incorporated by reference herein pursuant to Section
4,
        (ii) Employee’s rights to indemnification from any Company Party in respect of
        her services as a director, officer or employee of a Company Party (or of
        any
        entity for which Employee has served in any such capacity or a similar capacity
        at the request of the Company) as provided by law, that certain Indemnification
        Agreement dated as of April 29, 2004, by and between the Company and Employee
        (the “Indemnification Agreement”), or the
        certificates of incorporation or bylaws (or like constitutive documents)
        of any
        Company Party, and (iii) Employee’s rights under the Retained
        Awards.

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

         

      

      Employee,
        on behalf of herself and each of the other Employee Parties, hereby covenants
        forever not to assert, file, prosecute, commence or institute (or sponsor
        or
        purposely facilitate any person in connection with the foregoing), any complaint
        or lawsuit or any legal, equitable, arbitral or administrative proceeding
        of any
        nature, against any of the Company Parties in connection with any released
        Claims, and represents and warrants that no other person or entity has initiated
        or, to the extent within her control, will initiate any such proceeding on
        her
        behalf, and that if such a proceeding is initiated, Employee shall accept
        no
        benefit therefrom.

       

      (b)           The
        Company, on its own behalf and on behalf of the other Company Parties, hereby
        generally releases and forever discharges the Employee Parties from any and
        all
        Claims, known or unknown, of any kind and every nature whatsoever, and whether
        or not accrued or matured, which any of them may have, arising out of or
        relating to any transaction, dealing, relationship, conduct, act or omission,
        or
        any other matters or things occurring or existing at any time prior to and
        including the Effective Time (including but not limited to any Claims based
        on,
        relating to or arising under breach of contract (whether oral or written),
        tort,
        fraud, defamation, slander, violation of public policy, negligence, promissory
        estoppel, or any other federal, state or local law relating to employment
        or
        discrimination in employment) in all cases arising out of or relating to
        Employee’s employment by the Company or any subsidiary thereof or Employee’s
        investment in the Company or any subsidiary thereof or her services as a
        director, officer or employee of any Company Party (or of any entity for
        which
        Employee has served in any such capacity or a similar capacity at the request
        of
        the Company), or otherwise relating to the termination of such employment
        or
        services; provided, however, that this release will not limit or
        release (i) the Company’s rights under this Agreement or the Company’s rights
        under the Employment Agreement that survive the Effective Time and are expressly
        identified and incorporated by reference herein pursuant to Section 4,
        (ii) the Company’s rights against Employee with respect to any breach of
        fiduciary or other legal duties as a director or officer, any fraudulent
        or
        criminal activity or any action or conduct that would constitute Cause under
        the
        Employment Agreement, or (iii) the Company’s rights under the Retained
        Awards.

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

         

      

      The
        Company, on behalf of itself and the other Company Parties, hereby covenants
        forever not to assert, file, prosecute, commence or institute (or sponsor
        or
        purposely facilitate any person in connection with the foregoing), any complaint
        or lawsuit or any legal, equitable, arbitral or administrative proceeding
        of any
        nature, against any of the Employee Parties in connection with any released
        Claims, and represents and warrants that no other person or entity has initiated
        or to the extent within its control, will initiate any such proceeding on
        its
        behalf, and that if such a proceeding is initiated, the Company and the other
        Company Parties shall accept no benefit therefrom.

       

      6.  Additional
        Provisions.

       

      (a)  Notices.  Any
        notice, demand, or communication required, permitted, or desired to be given
        hereunder, shall be deemed effectively given when personally delivered or
        mailed
        by prepaid, certified mail, return receipt requested, addressed as
        follows:

       

      
        	 	
                To
                  Employee:

              	
                To
                  the Company:

              
	 	 	 
	 	
                Deborah
                  A. Hoffpauir

                2905
                  Wellborn

                Dallas,
                  Texas  75219

              	
                Odyssey
                  HealthCare, Inc.

                717
                  N. Harwood, Suite 1500

                Dallas,
                  Texas 75201

                Attn:  General
                  Counsel

              
	 	 	 
	 	 	
                With
                  a copy to:

              
	 	 	 
	 	 	
                P.
                  Gregory Hidalgo

                Vinson
                  & Elkins LLP

                3700
                  Trammell Crow Center

                2001
                  Ross Avenue

                Dallas,
                  Texas 75201

              

      

       

      or
        to such
        other address or addresses as any party hereto may from time to time specify
        in
        writing in a notice given to the other party in compliance with this Section
6(a).  Notices
        shall be deemed given upon the earlier of actual receipt or three days after
        mailing in accordance with this Section 6(a).

       

      (b)  Prior
        Agreements.  With the exception of (i) the Equity Agreements,
        (ii) the Termination Agreement, (iii) that certain Indemnification Agreement,
        dated April 29, 2004, by and between the Company and Employee, which is attached
        hereto as Exhibit C, and (iv) those provisions of the Employment
        Agreement that are specifically incorporated by reference herein in Section
4,
        this Agreement integrates the whole of all agreements and understandings
        of any
        sort or character between the parties concerning the subject matter of this
        Agreement and any other dealings between the parties, and supersedes all
        prior
        negotiations, discussions, or agreements of any sort whatsoever relating
        to the
        subject matter hereof, or any claims that might have ever been made by one
        party
        against the other.  There are no representations, agreements, or
        inducements except as set forth expressly and specifically in this
        Agreement.  There are no unwritten oral or verbal understandings,
        agreements, or representations of any sort whatsoever, it being stipulated
        that
        the rights of the parties shall be governed exclusively by this
        Agreement.

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

         

      

      (c)  Certain
        Definitions.  As used in this Agreement (including the
        provisions of the Employment Agreement incorporated by reference herein),
        the
        following terms have the meanings set forth below:

       

      (i)  
“Cause”
        means Employee’s

       

      (a)           continued
        failure to substantially perform Employee’s obligations and duties under
Section 2(a)
        (other than as a result of physical or mental incapacity), as reasonably
        determined by the Board, and which is not remedied within 30 days after receipt
        of written notice from the Company specifically identifying the manner in
        which
        the Company believes that Employee has not substantially performed Employee’s
        obligations and duties under Section 2(a);

       

      (b)           commission
        of an act of fraud, embezzlement, misappropriation, willful misconduct, bad
        faith, dishonesty, breach of trust, or breach of fiduciary duty against the
        Company or other conduct materially harmful or potentially materially harmful
        to
        the Company’s interest, as reasonably determined by the Board after a hearing by
        the Board following 10 days’ prior written notice to Employee of such
        hearing;

       

      (c)           material
        breach of Section 4(b)
        or Section 4(c);

       

      (d)           conviction,
        plea of no contest or nolo contendere, deferred adjudication or unadjudicated
        probation for any felony or any crime involving moral turpitude;

       

      (e)           failure
        to carry out, or comply with, in any material respect, any lawful directive
        of
        the Board, the President or the Chief Operating Officer of the Company
        consistent with the terms of this Agreement, which is not remedied within
        30
        days after receipt of written notice from the Company specifying such
        failure;

       

      (f)           violation
        of the Company’s substance abuse policy; or

       

      (g)           suspension
        or termination of Employee from the Medicare or Medicaid programs.

       

      (d)  Modification
        and Waiver.  This Agreement may not be modified or amended
        except in writing signed by the parties.  No term or condition of this
        Agreement will be deemed to have been waived except in writing by the party
        charged with waiver.  A waiver shall operate only as to the specific
        term or condition waived and will not operate as, or be construed to be,
        a
        waiver of any subsequent breach of the same or other provision
        hereof.  The failure of any party hereto to exercise any right, power
        or remedy provided under this Agreement or otherwise available in respect
        hereof
        at law or in equity, or to insist upon compliance by any other party hereto
        with
        its obligations hereunder, and any custom or practice of the parties at variance
        with the terms hereof, shall not constitute a waiver by such party of its
        right
        to exercise any such or other right, power or remedy or to demand such
        compliance.

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

         

      

      (e)  Counterparts.  This
        Agreement may be executed and delivered (including by facsimile transmission)
        in
        any number of counterparts, each of which shall be an original, but all of
        which
        together shall constitute one and the same instrument.  Any
        counterpart of this Agreement that has attached to it separate signature
        pages
        that together contain the signature of all parties hereto shall for all purposes
        be deemed a fully executed original.  Facsimile signatures shall
        constitute original signatures.

       

      (f)  Successors
        and Assigns.  This Agreement and the rights and obligations
        hereunder shall bind and inure to the benefit of any successor or successors
        of
        the Company by way of reorganization, merger or consolidation, and any assignee
        of all or substantially all of its business and properties, but, except as
        to
        any such successor or assignee of the Company, neither this Agreement nor
        any
        rights or benefits hereunder may be assigned by either party.

       

      (g)  Severability.  If
        any provision of this Agreement is held to be illegal, invalid or unenforceable
        for any reason, such provision shall be fully severable; this Agreement shall
        be
        construed and enforced as if such illegal, invalid or unenforceable provision
        had never comprised a portion of this Agreement; and the remaining provisions
        of
        this Agreement shall remain in full force and effect and shall not be affected
        by the illegal, invalid or unenforceable provision or by its severance from
        this
        Agreement.  Furthermore, in lieu of such illegal, invalid or
        unenforceable provisions, there shall be added automatically as part of this
        Agreement a provision as similar in terms to such illegal, invalid or
        unenforceable provision as may be possible and be legal, valid and
        enforceable.

       

      (h)  Injunctive
        Relief.  Employee acknowledges that money damages would be
        both incalculable and an insufficient remedy for breach by Employee of any
        of
        the provisions of the Employment Agreement that are specifically incorporated
        by
        reference herein by Section 4
        (i.e., of Sections 9 or 10 of the Employment Agreement, which shall
        be
        referred to in this Section 6(h)
        as the “Incorporated Employment Agreement
        Provisions”) and that any such breach would cause the Company
        irreparable harm.  Accordingly, the Company, in addition to any other
        remedies at law or in equity it may have, shall be entitled, without the
        requirement of posting a bond or other security, to equitable relief, including
        injunctive relief and specific performance, in connection with a breach by
        Employee of the Incorporated Employment Agreement Provisions.  The
        parties agree that the only circumstance in which disputes between them will
        not
        be subject exclusively to arbitration pursuant to the provisions in Section
6(n)
        is in connection with a breach of the Incorporated Employment Agreement
        Provisions by Employee.  The parties consent to venue in Dallas
        County, Texas and to the exclusive jurisdiction of competent state courts
        or
        federal courts in Dallas County, Texas for all litigation which may be brought,
        subject to the requirement for arbitration in Section 6(n),
        with respect to the terms of, and the transactions and relationships
        contemplated by, this Agreement.  The parties further consent to the
        non-exclusive jurisdiction of any state court located within a district which
        encompasses assets of a party against which a judgment has been rendered
        for the
        enforcement of such judgment or award against the assets of such
        party.

       

      (i)  Governing
        Law.  This Agreement has been executed and delivered in, and
        shall be interpreted, construed, and enforced pursuant to and in accordance
        with
        the laws of the State of Texas (without giving effect to principles of conflict
        of law) and, where applicable, the laws of the United States.

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

         

      

      (j)  Remedies
        Cumulative.  All rights, powers, and remedies provided under
        this Agreement or otherwise available in respect hereof at law or in equity
        shall be cumulative and not alternative, and the exercise of any thereof
        by any
        party shall not preclude the simultaneous or later exercise of any other
        such
        right, power, or remedy by such party.

       

      (k)  Third
        Party Beneficiaries.  Except as provided in Section 6(f)
        of this Agreement, this Agreement is not intended to be for the benefit of,
        and
        shall not be enforceable by, any person or entity who or which is not a party
        hereto.

       

      (l)  Construction.  This
        Agreement shall be deemed drafted equally by all the parties.  Its
        language shall be construed as a whole and according to its fair
        meaning.  Any presumption or principle that the language is to be
        construed against any party shall not apply.  The headings in this
        Agreement are only for convenience and are not intended to affect construction
        or interpretation.  Any references to paragraphs, subparagraphs, or
        sections are to those parts of this Agreement, unless the context clearly
        indicates to the contrary.  Also, unless the context clearly indicates
        to the contrary, (i) the plural includes the singular and the singular includes
        the plural, (ii) “and” and “or” are each used both conjunctively and
        disjunctively, (iii) “any,” “all,” “each,” or “every” means “any and all, and
        each and every,” (iv) “includes” and “including” are each “without limitation,”
and (v) “herein,” “hereof,” “hereunder,” and other similar compounds of the word
“here” refer to the entire Agreement and not to any particular paragraph,
        subparagraph, section or subsection.

       

      (m)  Expenses.  Except
        as otherwise expressly provided in this Agreement, all costs and expenses
        (including attorneys fees and expenses) incurred by the parties hereto in
        connection with this Agreement and the transactions contemplated hereby shall
        be
        borne solely and entirely by the party which has incurred such
        expenses.

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

         

      

      (n)  Arbitration.  Except
        as otherwise provided in Section 6(h),
        the Company and Employee agree to the resolution by binding arbitration of
        all
        claims, demands, causes of action, disputes, controversies or other matters
        in
        question (“Claims”), whether or not arising out
        to this Agreement, the Employment Agreement, or Employee’s employment (or
        resignation or termination), whether sounding in contract, tort or otherwise
        and
        whether provided by statute or common law, that the Company may have against
        Employee or that Employee may have against the Company or its parents,
        subsidiaries and affiliates, and each of the foregoing entities’ respective
        officers, directors, employees or agents in their capacity as such or
        otherwise.  Claims covered by this Section 6(n)
        also include claims by Employee for breach of this Agreement, wrongful
        termination, discrimination (based on age, race, sex, disability, national
        origin, or any other factor) and retaliation.  The Company and
        Employee agree that any arbitration shall be in accordance with the Federal
        Arbitration Act (“FAA”) and, to the extent an
        issue is not addressed by the FAA, with the then-current National Rules for
        the
        Resolution of Employment Disputes of the American Arbitration Association
        (“AAA”) or such other rules of the AAA as are
        applicable to the Claims being arbitrated.  If a party refuses to
        honor its obligations under this Section 6(n),
        the other party may compel arbitration in either federal or state
        court.  The arbitrator shall apply the substantive law of the State of
        Texas (excluding Texas choice-of-law principles that might call for the
        application of some other state’s law), or federal law, or both as applicable to
        the Claims asserted.  The arbitrator shall have exclusive authority to
        resolve any dispute relating to the interpretation, applicability,
        enforceability, or formation of this Section 6(n),
        including any Claim that all or part of this Agreement is void or voidable
        and
        any Claim that an issue is not subject to arbitration; provided that the
        arbitrator will not have the power to add or ignore any of the terms and
        conditions of this Agreement, and the arbitrator’s decision will not go beyond
        what is necessary for the interpretation, application, and enforcement of
        this
        Agreement and the obligations of the parties pursuant to this
        Agreement.  The parties agree that venue for arbitration will be in
        Dallas, Texas, and that any arbitration commenced in any other venue will
        be
        transferred to Dallas, Texas, upon the written request of any party to this
        Agreement.  In the event that an arbitration is actually conducted
        pursuant to this Section 6(n),
        the party in whose favor the arbitrator renders the award shall be entitled
        to
        recover from the other party all costs and expenses incurred, including
        reasonable attorneys’ fees, expert witness fees, and costs actually
        incurred.  Any and all of the arbitrator’s orders, decisions, and
        awards may be enforceable in, and judgment upon any award rendered by the
        arbitrator may be confirmed and entered by, any federal or state court having
        jurisdiction.  All proceedings conducted pursuant to this Section
6(n),
        including any order, decision, or award of the arbitrator, shall be kept
        confidential by all parties.  THE ARBITRATORS SHALL HAVE NO
        AUTHORITY TO AWARD PUNITIVE DAMAGES UNDER ANY CIRCUMSTANCES (WHETHER IT BE
        EXEMPLARY DAMAGES, TREBLE DAMAGES, OR ANY OTHER PENALTY OR PUNITIVE TYPE
        OF
        DAMAGES).  REGARDLESS OF WHETHER SUCH DAMAGES MAY BE AVAILABLE UNDER
        TEXAS LAW, EMPLOYEE AND THE COMPANY EACH HEREBY WAIVE THE RIGHT, IF ANY,
        TO
        RECOVER PUNITIVE DAMAGES IN CONNECTION WITH ANY CLAIMS.EMPLOYEE
        AND THE COMPANY ACKNOWLEDGE THAT, BY SIGNING THIS AGREEMENT, EMPLOYEE AND
        THE
        COMPANY ARE WAIVING ANY RIGHT THAT EMPLOYEE OR THE COMPANY MAY HAVE TO A
        JURY
        TRIAL OR A COURT TRIAL OF ANY EMPLOYMENT-RELATED CLAIM ALLEGED BY EMPLOYEE,
        EXCEPT AS PROVIDED IN SECTION
        6(h).

       

      

      [Signature
        Page to follow.]

       

       

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

         

      

      IN
        WITNESS
        WHEREOF, the Company has caused this Agreement to be executed in its corporate
        name by an officer thereof thereunto duly authorized, and Employee has hereunto
        set her hand, as of the day and year first above written.

       

      
        	 	ODYSSEY
                HEALTHCARE, INC.  
	 	 	 	 
	 	 	 	 
	 	By:	/s/  Robert
                A. Lefton	 
	 	Name:	Robert
                A. Lefton	 
	 	Title:	President
                and Chief Executive Officer	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	/s/
                Deborah A. Hoffpauir 	 
	 	DEBORAH
                A. HOFFPAUIR 	 

      

       

       

      
        
          
          

        

        
          S-1

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        A

       

      Employment
        Agreement of Deborah A. Hoffpauir

       

      

      
        
          
          

        

        
          Exhibit
            A-1

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        B

       

      Equity
        Agreements

       

       

      
        	
                1.
                    

              	
                Restricted
                  Stock Unit Award Agreement (Time-Based RSU Award), dated December
                  20,
                  2006, representing the right to receive 16,080 shares of the Company’s
                  common stock

              

      

       

      
        	
                2. 
                   

              	
                Restricted
                  Stock Unit Award Agreement (Additional Incentive Based RSU Award),
                  dated
                  December 20, 2006, representing the right to receive 29,480 shares
                  of the
                  Company’s common stock

              

      

       

      
        	
                3. 
                   

              	
                Nonstatutory
                  Stock Option Agreement, dated November 16, 2005, representing the
                  right to
                  acquire 90,000 shares of the Company’s common stock, of which options to
                  acquire 22,500 shares are exercisable as of July 1,
                  2007

              

      

       

      
        	
                4. 
                   

              	
                Restricted
                  Stock Award Agreement, dated November 18, 2004, representing the
                  right to
                  receive 30,000 shares of the Company’s common
                  stock

              

      

       

      
        	
                5. 
                   

              	
                Nonstatutory
                  Stock Option Agreement, dated January 26, 2004, representing the
                  right to
                  acquire 75,000 shares of the Company’s common stock, of which options to
                  acquire 75,000 shares are exercisable as of July 1,
                  2007

              

      

       

      
        	
                6. 
                   

              	
                Nonstatutory
                  Stock Option Agreement, dated June 20, 2003, representing the right
                  to
                  acquire 75,000 shares of the Company’s common stock (112,500 shares after
                  the Company’s three-for-two stock split on July 28, 2003), of which
                  options to acquire 112,500 shares are exercisable as of July 1,
                  2007

              

      

       

      
        	
                7. 
                   

              	
                Nonstatutory
                  Stock Option Agreement, dated November 20, 2002, representing the
                  right to
                  acquire 20,000 shares of the Company’s common stock (45,000 shares after
                  the Company’s three-for-two stock splits on February 6, 2003 and July 28,
                  2003), of which options to acquire 45,000 shares are exercisable
                  as of
                  July 1, 2007

              

      

       

      

      
        
          
          

        

        
          Exhibit
            B-1

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        C

       

      Indemnification
        Agreement

       

       

       

      Exhibit
        C-1

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