<PAGE> 1
As filed with the Securities and Exchange Commission on August 3, 1995
Registration No. 33-____________
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
__________________________________
CHAMPION HEALTHCARE CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
<TABLE>
<S> <C> <C>
DELAWARE 14340 TORREY CHASE, SUITE 320 58-2283872
(State of Other Jurisdiction HOUSTON, TEXAS 77014 (I.R.S. Employer
of Incorporation or Organization) (713) 583-5491 Identification No.)
(Address of Principal Executive Office)
</TABLE>
__________________________________
FOUNDER'S STOCK OPTIONS
CHAMPION HEALTHCARE CORPORATION EMPLOYEE STOCK OPTION PLAN
CHAMPION HEALTHCARE CORPORATION EMPLOYEE STOCK OPTION PLAN NO. 2
CHAMPION HEALTHCARE CORPORATION EMPLOYEE STOCK OPTION PLAN NO. 3
CHAMPION HEALTHCARE CORPORATION DIRECTORS' STOCK OPTION PLAN
CHAMPION HEALTHCARE CORPORATION PHYSICIANS STOCK OPTION PLAN
CHAMPION HEALTHCARE CORPORATION SENIOR EXECUTIVE STOCK OPTION PLAN NO. 4
AMERIHEALTH, INC. 1988 NON-QUALIFIED STOCK OPTION PLAN
CHAMPION HEALTHCARE CORPORATION SELECTED EXECUTIVE STOCK OPTION PLAN NO. 5
(Full Title of the Plan)
__________________________________
JAMES G. VANDEVENDER
Executive Vice-President
Champion Healthcare Corporation
14340 Torrey Chase
Suite 320
Houston, Texas 77014
(Name and Address of Agent for Service)
Telephone Number, Including Area Code
of Agent for Service:
(713) 583-5491
Approximate Date Sale to Public Will Start: As soon as practicable after the
effective date of this registration.
CALCULATION OF REGISTRATION FEE
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<CAPTION>
- -----------------------------------------------------------------------------------------------------------
TITLE OF AMOUNT TO PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
SECURITIES TO BE OFFERING PRICE PER AGGREGATE OFFERING REGISTRATION
BE REGISTERED REGISTERED SHARE(1) PRICE(1) FEE(2)
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock
$0.01 par value 1,077,164 $7.3125 $7,876,761.75 $2,716.00
- -----------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated in accordance with Rule 457(a) solely for the purpose of
calculating the registration fee and based upon weighted exercise prices
of the options covering the stock.
(2) As no separate consideration is payable for the Rights, the registration
fee for such securities is included in the fee for the Common Stock.
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PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTS
NOTE: The document(s) containing the employee benefit plan information
required by Item 1 of Form S-8 and the document of availability of registrant
information and any other information required by Item 2 of Form S-8 will be
sent or given to employees as specified by Rule 428 under the Securities Act of
1933, as amended (the "Securities Act"). In accordance with Rule 428 and the
requirements of Part I of Form S-8, such documents are not being filed with the
Securities and Exchange Commission (the "Commission") either as part of this
Registration Statement or as prospectuses or prospectus supplements pursuant to
Rule 424 under the Securities Act. The registrant shall maintain a file of such
documents in accordance with the provision of Rule 428. Upon request, the
registrant shall furnish to the Commission or its staff a copy or copies of all
of the documents included in such file.
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
This registration statement incorporates herein by reference the
following documents which have been filed (File No. 0-11851) with the Commission
by Champion Healthcare Corporation (the "Company") pursuant to the Securities
Exchange Act of 1934, as amended ("Exchange Act"):
1. The Company's Annual Report on Form 10-K for the year ended December
31, 1994, as amended on Form 10-K/A Amendment No. 3;
2. The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1995, as amended in Form 10-Q Amendment No. 2.
3. The Company's registration statement on Form 8.
Each document filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act subsequent to the date of this registration statement and
prior to the filing of a post-effective amendment which indicates that all
securities offered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference in this
registration statement and to be a part hereof from the date of filing such
documents.
Any statement incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this registration statement to the extent that a
statement contained herein or in any subsequently filed document which also is
or is deemed to be incorporated by reference herein modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this registration
statement.
ITEM 4. DESCRIPTION OF SECURITIES
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Legal opinion-- the validity of the shares of common stock to be offered
hereunder has been passed upon for Champion Healthcare Corporation by Wayne M.
Whitaker of the law firm Michener, Larimore, Swindle, Whitaker, Flowers, Sawyer,
Reynolds & Chalk, L.L.P. ("Michener Larimore"). 4,243 shares of common stock of
Champion Healthcare Corporation are owned by partners and associates of the
firm.
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ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law provides, generally,
that a corporation shall have the power to indemnify any person who was or is a
party or is threatened to be made a party to any suit or proceeding (except
actions by or in the right of the corporation) by reason of the fact that such
person is or was a director or officer of the corporation against all expenses,
judgments, fines and amounts paid in settlement actually and reasonably incurred
by him in connection with such suit or proceeding if he acted in good faith and
in a manner he reasonably believed to be in or not opposed to the best interests
of the corporation and, with respect to any criminal action or proceeding, had
no reasonable cause to believe his conduct was unlawful. A corporation may
similarly indemnify such person for expenses actually and reasonably incurred by
him in connection with the defense or settlement of any action or suit by or in
the right of the corporation, provided such person acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
the corporation, and, in the case of claims, issues and matters as to which such
person shall have been adjudged liable to the corporation, provided that a court
shall have determined, upon application, that, despite the adjudication of
liability but in view of all of the facts and circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such expenses which
such court shall deem proper.
Section 102(b)(7) of the Delaware General Corporation Law ("DGCL")
provides, generally, that the certificate of incorporation may contain a
provision eliminating or limiting the personal liability of a director to the
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, provided that such provision may not eliminate or limit the
liability of a director (i) for any breach of the director's duty of loyalty to
the corporation or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(iii) under section 174 of Title 8, or (iv) for any transaction from which the
director derived an improper personal benefit. No such provision may eliminate
or limit the liability of a director for any act or omission occurring prior to
the date when such provision becomes effective.
Article VI of the Company's Certificate of Incorporation provides as
follows:
"A director of the Corporation shall not be personally liable to the
corporation or its stockholders for monetary damages for any breach of
fiduciary duty as a director, except for liability (i) for any breach by
the director of his duty of loyalty to the Corporation or its
stockholders, (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, (iii) under
Section 174 of the DGCL or (iv) for any transaction from which the
director derived an improper personal benefit.
No repeal, modification or amendment of, or adoption of any
provision inconsistent with this Article VI nor, to the fullest extent
permitted by law, any modification of law shall adversely affect any
right or protection of a director of the
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Corporation existing at the time of such repeal, amendment, adoption of
modification or affect the liability of any director of the Corporation
for any action taken or any omission that occurred prior to the time of
such repeal, amendment, adoption or modification.
If the DGCL shall be amended after the date hereof to authorized
corporation action further eliminating or limiting the liability of
directors, then a director of the Corporation, in addition to the
circumstances in which he is not liable immediately prior to such
amendment, shall be free of liability to the fullest extent permitted by
the DGCL, as so amended."
Article VII of the Company's By-laws also contains an indemnity
provision, requiring the Company to indemnify members of the Board of Directors
and officers of the Company and their respective heirs, personal representatives
and successors in interest, to the extent provided by the Delaware Corporation
statutes and by the Company's Certificate of Incorporation.
The Company may purchase liability insurance policies covering its
directors and officers.
In addition, the Selling Stockholders have agreed in the Lenox Agreement
to indemnify the Company, its directors and officers and each person, if any,
who controls the Company within the meaning of either the Securities Act of
1933, as amended, or the Securities and Exchange Act of 1934, as amended,
against certain liabilities including civil liabilities under the Securities
Act.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
The Exhibit Index immediately preceding the exhibits is incorporated
herein by reference.
ITEM 9. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
registration statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the
registration statement (or the most
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recent post-effective amendment thereof) which,
individually or in the aggregate, represent a
fundamental change in the information set forth in the
registration statement;
(iii) To include any material information with
respect to the plan of distribution not previously
disclosed in the registration statement or any
material change to such information in the
registration statement;
provided, however, that the undertakings set forth in
paragraph (i) and (ii) above do not apply if the information
required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by
the registrant pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any
liability under the Securities Act of 1933, each such
post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered
therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being
registered which remain unsold at the termination of the
offering.
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of the registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Exchange Act) that is incorporated
by reference in this registration statement shall be deemed to be a
new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors,
officers, and controlling persons of the registrant pursuant to the
provisions described under Item 6 above, or otherwise, the
registrant has been advised that in the opinion of the Commission
such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director, officer,
on controlling person of the registrant in the successful defense of
any action, suit or proceeding) is asserted by such director,
officer or controlling person in
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connection with the securities being registered, the registrant
will, unless in the opinion of its counsel that matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed
by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Houston, State of Texas, on August 3, 1995.
CHAMPION HEALTHCARE CORPORATION
BY: /s/JAMES G. VANDEVENDER
----------------------------
James G. VanDevender
Executive Vice-President
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints James G. VanDevender, Deborah H. Frankovich,
Suzanne S. Miskin, Esq, and Wayne M. Whitaker, Esq., and each of them, his true
and lawful attorneys-in-fact and agents with full power of substitution and
re-substitution for him and in his name, place and stead, in any and all
capacities, to sign any or all amendments (including post-effective amendments)
to this registration statement and to file the same, with all exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission and any state Securities regulatory board, agency or commission,
granting unto said attorneys-in-fact and agents and each of them full power and
authority, to do and perform each and every act and thing requisite or necessary
to be done in and about the premises, to all intents and purposes and as fully
as they might or could do in person, hereby ratifying and confirming all that
said attorneys-in-fact and agents or their substitutes may lawfully do or cause
to be done by virtue hereof.
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Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
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SIGNATURE TITLE DATE
<S> <C> <C>
/s/ Charles R. Miller President, CEO & Director August 3, 1995
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Charles R. Miller
/s/ James G. VanDevender Executive Vice-president, August 3, 1995
- ------------------------ CFO and Director
James G. VanDevender
/s/ Nolan Lehmann Director August 3, 1995
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Nolan Lehmann
/s/ Paul B. Queally Director August 3, 1995
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Paul B. Queally
/s/ James A. Conroy Director August 3, 1995
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James A. Conroy
/s/ David S. Spencer Director August 3, 1995
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David S. Spencer
/s/ Manuel M. Ferris Director August 3, 1995
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Manuel M. Ferris
- ------------------------ Director
Scott F. Meadow
/s/ William G. White Director August 3, 1995
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William G. White
- ------------------------ Director
Richard D. Sage
/s/ Robert M. Starling Vice-president & August 3, 1995
- ------------------------ Controller
Robert M. Starling
</TABLE>
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<PAGE> 9
INDEX TO EXHIBITS
EXHIBIT
NUMBER
- -------
*4.1(a)- Certificate of Incorporation (Incorporated by reference to
Exhibit 3.01 of the registrant's Form 10-K for the year ended
December 31, 1987 and to Exhibit 4 of the registrant's
Form 10-Q for the quarter ended September 30, 1989
*4.1(b)- Amended Certificate of Incorporation dated December 6, 1994
(Incorporated by reference to Exhibit 3.01(b) of the registrant's
Form 10-K for the year ended December 31, 1994)
4.2- Bylaws of Champion Healthcare Corporation
4.3- Form of Common Stock Certificate
4.4- Founder's Stock Option-Charles R. Miller
4.5- Founder's Stock Option-James G. VanDevender
4.6- Champion Healthcare Corporation Employee Stock Option Plan
4.7- Champion Healthcare Corporation Employee Stock Option Plan No. 2
4.8- Champion Healthcare Corporation Employee Stock Option Plan No. 3
4.9- Champion Healthcare Corporation Directors' Stock Option Plan
4.10- Champion Healthcare Corporation Physicians Stock Option Plan
4.11- Champion Healthcare Corporation Senior Executive Stock
Option Plan No. 4
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EXHIBIT
NUMBER
- ------
4.12- Champion Healthcare Corporation Selected Executive Stock Option
Plan No. 5
*4.13- AmeriHealth, Inc. 1988 Non-Qualified Stock Option Plan
(Incorporated by reference to Exhibit 10.06 of the registrant's
Form 10-K for the year ended December 31, 1992)
5 - Opinion of Michener, Larimore, Swindle, Whitaker, Flowers, Sawyer,
Reynolds & Chalk, L.L.P.
23.1 - Consent of Coopers & Lybrand, L.L.P.
23.2 - Consent of Michener, Larimore, Swindle, Whitaker, Flowers, Sawyer,
Reynolds & Chalk, L.L.P. (incorporated in Exhibit 5)
_________________
* Incorporated by reference as indicated.
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EXHIBIT 4.2
BYLAWS OF
CHAMPION HEALTHCARE CORPORATION
(THE "CORPORATION")
ARTICLE I
OFFICES
SECTION 1.1. OFFICES. The principal business office of the
Corporation shall be at 14340 Torrey Chase Boulevard, Suite 320, Houston,
Texas. The registered office of the Corporation shall be in the County of New
Castle, State of Delaware. The Corporation may have such other offices within
or without the State of Delaware as the Board of Directors may from time to
time establish.
ARTICLE II
CAPITAL STOCK
SECTION 2.1. CERTIFICATE REPRESENTING SHARES. Shares of the
classes of capital stock of the Corporation shall be represented by
certificates in such form or forms as the Board of Directors may approve;
provided that, such form or forms shall comply with all applicable requirements
of law and of the Certificate of Incorporation. Such certificates shall be
signed by the president or a vice president, and by the secretary or an
assistant secretary, of the Corporation and may be sealed with the seal of the
Corporation or imprinted or otherwise marked with a facsimile of such seal. In
the case of any certificate countersigned by any transfer agent or registrar,
provided such countersigner is not the Corporation itself or an employee
thereof, the signature of any or all of the foregoing officers of the
Corporation may be represented by a printed facsimile thereof. If any officer
whose signature, or a facsimile thereof, shall have been set upon any
certificate shall cease, prior to the issuance of such certificate, to occupy
the position in right of which his signature, or facsimile thereof, was so set
upon such certificate, the Corporation may nevertheless adopt and issue such
certificate with the same effect as if such officer occupied such position as
of such date of issuance; and, issuance and delivery of such certificate by the
Corporation shall constitute adoption thereof by the Corporation. The
certificates shall be consecutively numbered, and as they are issued, a record
of such issuance shall be entered in the books of the Corporation.
SECTION 2.2. STOCK CERTIFICATE BOOK AND STOCKHOLDERS OF
RECORD. The secretary of the Corporation shall maintain, among other records,
a stock certificate book, the stubs in which shall set forth the names and
addresses of the holders of all issued shares of the Corporation, the number of
shares held by each, the number of certificates representing such shares, the
date of issue of such certificates, and whether or not such shares originate
from original issue or from transfer.
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The names and addresses of stockholders as they appear on the stock certificate
book shall be the official list of stockholders of record of the Corporation
for all purposes. The Corporation shall be entitled to treat the holder of
record of any shares as the owner thereof for all purposes, and shall not be
bound to recognize any equitable or other claim to, or interest in, such shares
or any rights deriving from such shares on the part of any other person,
including, but without limitation, a purchaser, assignee, or transferee, unless
and until such other person becomes the holder of record of such shares,
whether or not the Corporation shall have either actual or constructive notice
of the interest of such other person.
SECTION 2.3. STOCKHOLDER'S CHANGE OF NAME OR ADDRESS. Each
stockholder shall promptly notify the secretary of the Corporation, at its
principal business office, by written notice sent by certified mail, return
receipt requested, of any change in name or address of the stockholder from
that as it appears upon the official list of stockholders of record of the
Corporation. The secretary of the Corporation shall then enter such changes
into all affected Corporation records, including, but not limited to, the
official list of stockholders of record.
SECTION 2.4. TRANSFER OF STOCK. The shares represented by
any certificate of the Corporation are transferable only on the books of the
Corporation by the holder of record thereof or by his duly authorized attorney
or legal representative upon surrender of the certificate for such shares,
properly endorsed or assigned. The Board of Directors may make such rules and
regulations concerning the issue, transfer, registration and replacement of
certificates as they deem desirable or necessary.
SECTION 2.5. TRANSFER AGENT AND REGISTRAR. The Board of
Directors may appoint one or more transfer agents or registrars of the shares,
or both, and may require all share certificates to bear the signature of a
transfer agent or registrar, or both.
SECTION 2.6. LOST, STOLEN OR DESTROYED CERTIFICATES. The
Corporation may issue a new certificate for shares of stock in the place of any
certificate theretofore issued and alleged to have been lost, stolen or
destroyed; but, the Board of Directors may require the owner of such lost,
stolen or destroyed certificate, or his legal representative, to furnish an
affidavit as to such loss, theft, or destruction and to give a bond in such
form and substance, and with such surety or sureties, with fixed or open
penalty, as the Board may direct, in order to indemnify the Corporation and its
transfer agents and registrars, if any, against any claim that may be made on
account of the alleged loss, theft or destruction of such certificate.
SECTION 2.7. FRACTIONAL SHARES. Only whole shares of the
stock of the Corporation shall be issued. In case of any transaction by reason
of which a fractional share might otherwise be issued, the directors, or the
officers in the exercise of powers delegated by the directors, shall take such
measures consistent with the law, the Certificate of Incorporation and these
Bylaws, including (for example, and not by way of limitation) the payment in
cash of an amount equal to the fair value of any fractional share, as they may
deem proper to avoid the issuance of any fractional share.
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ARTICLE III
THE STOCKHOLDERS
SECTION 3.1. ANNUAL MEETING. The Annual Meeting of the
Stockholders, for the election of directors and for the transaction of such
other business as may properly come before the meeting, shall be held at the
principal office of the Corporation, at 2:00 p.m. local time, on the second
Friday of April of each year unless such day is a legal holiday, in which case
such meeting shall be held at such hour on the first day thereafter which is
not a legal holiday; or, at such other place and time as may be designated by
the Board of Directors. Failure to hold any annual meeting or meetings shall
not work a forfeiture or dissolution of the Corporation.
SECTION 3.2. SPECIAL MEETINGS. Except as otherwise provided
by law or by the Certificate of Incorporation, special meetings of the
stockholders may be called by the chairman of the Board of Directors, the
president, or the holders of not less than one-tenth of all the shares having
voting power at such meeting, and shall be held at the principal office of the
Corporation or at such other place, and at such time, as may be stated in the
notice calling such meeting. Business transacted at any special meeting of
stockholders shall be limited to the purpose stated in the notice of such
meeting given in accordance with the terms of Section 3.3.
SECTION 3.3. NOTICE OF MEETINGS - WAIVER. Written or printed
notice of each meeting of stockholders, stating the place, day and hour of any
meeting and, in case of a special stockholders' meeting, the purpose or
purposes for which the meeting is called, shall be delivered not less than ten
nor more than sixty days before the date of such meeting, either personally or
by mail, by or at the direction of the president, the secretary, or the persons
calling the meeting, to each stockholder of record entitled to vote at such
meeting. If mailed, such notice shall be deemed to be delivered when deposited
in the United States mail addressed to the stockholder at his address as it
appears on the stock transfer books of the Corporation, with postage thereon
prepaid. Such further or earlier notice shall be given as may be required by
law. The signing by a stockholder of a written waiver of notice of any
stockholders' meeting, whether before or after the time stated in such waiver,
shall be equivalent to the receiving by him of all notice required to be given
with respect to such meeting. Attendance by a person at a stockholders'
meeting shall constitute a waiver of notice of such meeting except when a
person attends a meeting for the express purpose of objecting, at the beginning
of the meeting, to the transaction of any business because the meeting is not
lawfully called or convened. Except as otherwise provided in Section 3.6, no
notice of any adjournment of any meeting shall be required if the time and
place thereof are announced at the meeting at which the adjournment is taken.
SECTION 3.4. CLOSING OF TRANSFER BOOKS AND FIXING RECORD
DATE. In order that the Corporation may determine the stockholders entitled to
notice of or to vote at any meeting of stockholders or adjournment thereof, or
entitled to receive payment of any dividend or other distribution or allotment
of any rights, or entitled to exercise any rights in respect of any change,
conversion or exchange of stock or for the purpose of any other lawful action,
the Board of Directors may fix, in advance, a record date, which shall not be
more than sixty nor less than ten days before the date of such meeting, nor
more than sixty days prior to any other action. If no record date is fixed,
the record date shall be as follows: the record date for determining
stockholders entitled to
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<PAGE> 4
notice of or to vote at a meeting of stockholders shall be at the close of
business on the day next preceding the day on which notice is given, or, if
notice is waived, at the close of business on the day next preceding the day on
which the meeting is held; the record date for determining stockholders
entitled to express consent to corporate action in writing without a meeting,
when no prior action by the Board of Directors is necessary, shall be the day
on which the first written consent is delivered to the Corporation by delivery
to its registered office in Delaware, its principal place of business, or an
officer or agent of the Corporation having custody of the book in which
proceedings of meetings of stockholders are recorded; and, the record date for
determining stockholders entitled to express consent to corporate action
without a meeting, when prior action by the Board of Directors is necessary
shall be at the close of business on the day on which the Board of Directors
adopts the resolution relating thereto.
SECTION 3.5. VOTING LIST. The officer or agent having charge
of the stock transfer books for shares of the Corporation shall make, at least
ten days before each meeting of stockholders, a complete list of the
stockholders entitled to vote at such meeting or any adjournment thereof,
arranged in alphabetical order, with the address of and the number of shares
held by each, which list, for a period of ten days prior to such meeting, shall
be open to the examination of any stockholder, for any purpose germane to the
meeting, during ordinary business hours, either at a place within the city
where the meeting is to be held, which place shall be specified in the notice
of the meeting, or if not so specified, at the place where the meeting is to be
held, shall be subject to lawful inspection by any stockholder at any time
during the usual business hours. Such list shall also be produced and kept
open at the time and place of the meeting and shall be subject to the
inspection of any stockholder during the whole time of the meeting. Failure to
comply with this section shall not affect the validity of any action taken at
such meeting.
SECTION 3.6. QUORUM AND OFFICERS. Except as otherwise
provided by law, by the Certificate of Incorporation or by these Bylaws, the
presence in person or by proxy of the holders of shares of stock having a
majority of the votes which could be cast by the holders of all outstanding
shares of stock entitled to vote at the meeting shall constitute a quorum at a
meeting of stockholders, but the stockholders present at any meeting, although
representing less than a quorum, may from time to time adjourn the meeting to
some other day and hour, without notice other than announcement at the meeting;
provided, however, that if the adjournment is for more than thirty (30) days,
or if after the adjournment a new second date is set for the adjourned meeting,
a notice of the adjourned meeting shall be given to each stockholder of record
entitled to vote at the meeting. The stockholders present at a duly organized
meeting may continue to transact business until adjournment, notwithstanding
the withdrawal of enough stockholders to leave less than a quorum.
SECTION 3.7. VOTING AT MEETINGS. Each outstanding share of
Common Stock shall be entitled to one (1) vote on each matter submitted to a
vote at a meeting of stockholders, except to the extent that the Certificate of
Incorporation or the laws of the State of Delaware provide otherwise. Each
outstanding share of preferred stock shall be entitled to vote, and shall have
such rights, as may be set forth in the Corporation's Certificate of
Incorporation, as amended, from time to time. On all questions other than the
election of directors, the vote of the holders of shares of stock having a
majority of the votes which could be cast by the holders of all shares of stock
entitled to vote thereon and represented in person or by proxy at a meeting at
which a quorum is present shall be the act of
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the stockholders' meeting, unless the vote of a greater number is required by
law or by the Certificate of Incorporation or these Bylaws. The Chairman of
the Board shall preside at, and the secretary shall keep the records of, each
meeting of stockholders, and in the absence of either such officer, his duties
shall be performed by any other officer authorized by these Bylaws or any
person appointed by resolution duly adopted at the meeting. In the case of any
contested election for any directorship, the candidate for such position
receiving a plurality of the votes cast in such election shall be elected to
such position.
SECTION 3.8. PROXIES. A stockholder may vote either in
person or by proxy executed in writing by the stockholder or by his duly
authorized attorney-in-fact. No proxy shall be valid after eleven months from
the date of its execution unless otherwise provided in the proxy. A duly
executed proxy shall be irrevocable if it states that it is irrevocable and if,
and only as long as, it is coupled with an interest sufficient in law to
support an irrevocable power. A proxy may be made irrevocable regardless of
whether the interest with which it is coupled is an interest in the stock
itself or an interest in the Corporation generally.
SECTION 3.9. BALLOTING. All elections of directors shall be
by written ballot. Upon the demand of any stockholder, the vote upon any other
question before the meeting shall be by ballot. At each meeting, inspectors of
election shall be appointed by the presiding officer of the meeting. No
director or candidate for the office of director shall be appointed as such
inspector. The number of votes cast by shares in the election of directors
shall be recorded in the minutes.
SECTION 3.10. PROHIBITION OF CUMULATIVE VOTING FOR DIRECTORS.
No stockholder shall have the right to cumulate his votes for the election of
directors.
SECTION 3.11. RECORD OF STOCKHOLDERS. The Corporation shall
keep at its principal business office, or the office of its transfer agents or
registrars, a record of its stockholders, giving the names and addresses of all
stockholders and the number and class of the shares held by each.
SECTION 3.12. ACTION WITHOUT MEETING. Unless otherwise
provided in the Certificate of Incorporation, any action required to be taken
at any annual or special meeting of stockholders of the Corporation, or any
action which may be taken at any annual or special meeting of such
stockholders, may be taken without a meeting, without prior notice and without
a vote, if a consent in writing, setting forth the action so taken, shall be
signed by the holders of outstanding stock having not less than the minimum
number of votes that would be necessary to authorize or take such action at a
meeting at which all shares entitled to vote thereon were present and voted.
Prompt notice of the taking of the corporate action without a meeting by less
than unanimous written consent shall be given to those stockholders who have
not consented in writing.
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ARTICLE IV
THE BOARD OF DIRECTORS
SECTION 4.1. MANAGEMENT AND CONTROL. The business and
affairs of the Corporation shall be managed and controlled by the Board of
Directors; and, subject to any restrictions imposed by law, by the Certificate
of Incorporation, or by these Bylaws, the Board of Directors may exercise all
the powers of the Corporation. Provided, however, in accordance with Article
IV, Paragraph 7 of the Corporation's Certificate of Incorporation, as amended,
neither the Board of Directors nor the Corporation shall (A) without the
affirmative consent or approval of the holders of shares representing at least
75% of the Series C Preferred Stock and Series BB Preferred Stock then
outstanding, together voting as a class and 66 2/3% of the Series A Preferred
Stock then outstanding, voting as a class (i) authorize the issuance of any
new, or increase the authorized number of shares of any existing, class of
capital stock of the Corporation (or any other series of Preferred Stock) which
would be senior or superior as to dividends, redemption or upon liquidation to
any of the Series C Preferred Stock , Series BB Preferred Stock or Series A
Preferred Stock, or (ii) increase the number of shares of Preferred Stock
authorized in the Certificate of Incorporation or create any other class of
stock (or any other series of Preferred Stock) ranking on a parity with any of
the Series C Preferred Stock or Series BB Preferred Stock as to dividends,
redemption or upon liquidation, or (B) without the affirmative consent or
approval of the holders of shares representing at least 90% of the Series C
Preferred Stock and Series BB Preferred Stock then outstanding, together voting
as a class, and 90% of the Series A Preferred Stock then outstanding, voting as
a class (x) amend the voting powers, designations, preferences, or relative,
participating, optional or other special rights or qualifications, limitations
or restrictions in respect of the Series A Preferred Stock, Series BB Preferred
Stock or Series C Preferred Stock; (y) reissue any shares of Series C
Preferred Stock, Series BB Preferred Stock or Series A Preferred Stock that
have been redeemed or repurchased; or (z) take any action to cause any
amendment, alteration or repeal of any of the provisions of the Certificate of
Incorporation or the by-laws that would materially adversely affect the rights
of holders of Series A Preferred Stock, Series BB Preferred Stock or Series C
Preferred Stock, or (C) without the affirmative consent or approval of the
holders of shares representing at least 75% of the Series D Preferred Stock
then outstanding, (i) authorize the issuance of any new, or increase the
authorized number of shares of any existing, class of capital stock of the
Corporation (or any other series of Preferred stock) which would be senior or
superior as to dividends, redemption or upon liquidation to the Series D
Preferred Stock, or (ii) increase the number of shares of Preferred Stock
authorized in the Certificate of Incorporation or create any other class of
stock (or any other series of Preferred Stock) ranking on a parity with the
Series D Preferred Stock as to dividends, redemption or upon liquidation, or
(D) without the affirmative consent or approval of the holders of shares
representing at least 90% of the Series D Preferred Stock then outstanding (x)
amend the voting powers, designations, preferences, or relative, participating,
optional or other special rights or qualifications, limitations or restrictions
in respect of the Series D Preferred Stock, or (y) reissue any shares of Series
D Preferred Stock that have been redeemed or repurchased, or (z) take any
action to cause any amendment, alteration or repeal of any of the provisions of
the Certificate of Incorporation or the by-laws that would materially adversely
affect the rights of the holders of Series D Preferred Stock.
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SECTION 4.2. NUMBER, QUALIFICATIONS AND TERM. The Board of
Directors may consist of eleven (11) members. Such number may be increased or
decreased by amendment of these Bylaws and the Certificate of Incorporation,
including without limitation Article IV, Paragraph 6, provided that no decrease
shall effect a shortening of the term of any incumbent director. Directors
need not be residents of Delaware or stockholders of the Corporation absent
provision to the contrary in the Certificate of Incorporation or laws of the
State of Delaware. Except as otherwise provided in Section 4.3 of these
Bylaws, each position on the Board of Directors shall be filled by election at
the annual meeting of stockholders. Any such election shall be conducted in
accordance with Section 3.10 of these Bylaws. Each person elected a director
shall hold office until his successor is duly elected and qualified or until
his earlier resignation or removal in accordance with Section 4.3 of these
Bylaws.
SECTION 4.3. REMOVAL. Subject to the rights of the holders
of any class or series of stock having preference over the Common Stock as to
dividends or upon liquidation, dissolution or winding up of the Corporation to
elect directors under specified circumstances, if any, any director or the
entire Board of Directors may be removed from office, with or without cause, at
any special meeting of stockholders by the affirmative vote of the holders of a
majority of the shares present in person or by proxy and entitled to vote at
such meeting, if notice of the intention to act upon such matter shall have
been given in the notice calling such meeting. If the notice calling such
meeting shall have so provided, the vacancy caused by such removal may be
filled at such meeting by the affirmative vote of a majority in number of the
shares of the stockholders present in person or by proxy and entitled to vote.
SECTION 4.4. VACANCIES. Subject to the rights of the holders
of any class or series of stock having preference over the Common Stock as to
dividends or upon liquidation, dissolution or winding up of the Corporation to
elect directors under specified circumstances, if any, any vacancy occurring in
the Board of Directors may be filled by the vote of a majority of the remaining
directors, even if such remaining directors comprise less than a quorum of the
Board of Directors. A director elected to fill a vacancy shall be elected for
the unexpired term of his predecessor in office. Subject to the rights of the
holders of any class or series of stock having preference over the Common Stock
as to dividends or upon liquidation, dissolution or winding up of the
Corporation to elect directors under specified circumstances, if any, any
position on the Board of Directors to be filled by reason of an increase in the
number of directors shall be filled by the vote of a majority of the directors,
election at an annual meeting of the stockholders, or at a special meeting of
stockholders duly called for such purpose.
SECTION 4.5. REGULAR MEETINGS. Regular meetings of the Board
of Directors shall be held no less frequently than quarterly, one of which
shall be held immediately following each annual meeting of stockholders, at the
place of such meeting, and at such other times and places as the Board of
Directors shall determine. No notice of any kind of such regular meetings need
be given to either old or new members of the Board of Directors.
SECTION 4.6. SPECIAL MEETINGS. Special meetings of the Board
of Directors shall be held at any time by call of the Chairman of the Board,
the president, or more than 50% of the members of the Board of Directors. The
secretary shall give notice of each special meeting to each
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director at his usual business or residence address by mail at least three days
before the meeting or by telegraph or telephone at least one day before such
meeting. Except as otherwise provided by law, by the Certificate of
Incorporation, or by these Bylaws, such notice need not specify the business to
be transacted at, or the purpose of, such meeting. No notice shall be
necessary for any adjournment of any meeting. The signing of a written waiver
of notice of any special meeting by the person or persons entitled to such
notice, whether before or after the time stated therein, shall be equivalent to
the receiving of such notice. Attendance of a director at a meeting shall also
constitute a waiver of notice of such meeting, except where a director attends
a meeting for the express and announced purpose of objecting, at the beginning
of the meeting, to the transaction of any business on the ground that the
meeting is not lawfully called or convened.
SECTION 4.7. QUORUM. A majority of the number of directors
fixed by these Bylaws shall constitute a quorum for the transaction of business
and the act of not less than a majority of such quorum of the directors shall
be required in order to constitute the act of the Board of Directors, unless
the act of a greater number shall be required by law, by the Certificate of
Incorporation or by these Bylaws.
SECTION 4.8. PROCEDURE AT MEETINGS. The Board of Directors,
at each regular meeting held immediately following the annual meeting of
stockholders, shall appoint one of their member as Chairman of the Board of
Directors. The Chairman of the Board shall preside at meetings of the Board.
In his absence at any meeting, any officer authorized by these Bylaws or any
member of the Board selected by the members present shall preside. The
secretary of the Corporation shall act as secretary at all meetings of the
Board. In his absence, the presiding officer of the meeting may designate any
person to act as secretary. At meetings of the Board of Directors, the
business shall be transacted in such order as the Board may from time to time
determine.
SECTION 4.9. PRESUMPTION OF ASSENT. Any director of the
Corporation who is present at a meeting of the Board of Directors at which
action on any corporate matter is taken shall be presumed to have assented to
the action taken unless his dissent shall be entered in the minutes of the
meeting or unless he shall file his written dissent to such action with the
person acting as the secretary of the meeting before the adjournment thereof or
shall forward such dissent by registered mail to the secretary of the
Corporation immediately after the adjournment of the meeting. Such right to
dissent shall not apply to a director who voted in favor of such action.
SECTION 4.10. ACTION WITHOUT A MEETING. Any action required
by statute or permitted to be taken at a meeting of the directors of the
Corporation, or of any committee thereof, may be taken without a meeting if a
consent in writing, setting forth the action so taken, shall be signed by all
directors or all committee members as the case may be, and such consent shall
have the same force and effect as a unanimous vote of the directors or the
committee. Such signed consent, or a signed copy thereof, shall be filed with
the minutes of the proceedings of the Board or committee.
SECTION 4.11. COMPENSATION. Directors as such shall not
receive any stated salary for their service, but by resolution of the Board of
Directors, a fixed sum and reimbursement for reasonable expenses of attendance,
if any, may be allowed for attendance at each regular or special
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meeting of the Board of Directors or at any meeting of the executive committee
of directors, if any, to which such director may be elected in accordance with
the following Section 4.12 or at any other committee meeting of directors, if
any, to which such director may be elected in accordance with Section 4.13;
but, nothing herein shall preclude any director from serving the Corporation in
any other capacity or receiving compensation therefor.
SECTION 4.12. EXECUTIVE COMMITTEE. The Board of Directors,
by resolution adopted by a majority of the number of directors fixed by these
Bylaws, may designate an executive committee, which committee shall consist of
two or more of the directors of the Corporation. Such executive committee may
exercise such authority of the Board of Directors in the business and affairs
of the Corporation as the Board of Directors may by resolution duly delegate to
it except as prohibited by law, provided that the executive committee may not
take the following actions: (i) issue stock; (ii) liquidate or vote to
dissolve the Corporation; (iii) terminate the Corporation's Employment
Agreements with Charles R. Miller or James G. VanDevender; (iv) declare a
dividend or other distribution of assets; (v) approve any transaction involving
a merger, acquisition, reorganization, sale of assets, or recapitalization in
which the Corporation is not the surviving entity or in which there is a change
in control of the Corporation or (vi) any other action reserved for approval by
the stockholders pursuant to law. The designation of such committee and the
delegation thereto of authority shall not operate to relieve the Board of
Directors, or any member thereof, of any responsibility imposed upon it or him
by law. Any member of the executive committee may be removed by the Board of
Directors by the affirmative vote of the greater of (x) a majority of the
number of directors fixed by the Bylaws or (y) that number of directors which
collectively own beneficially two-thirds of the Common Stock of the
Corporation, whenever in the judgment of the Board the best interests of the
Corporation will be served thereby. The executive committee shall keep regular
minutes of its proceedings and report the same to the Board of Directors when
required. The minutes of the proceedings of the executive committee shall be
placed in the minute book of the Corporation.
SECTION 4.13. OTHER COMMITTEES. The Board of Directors, by
resolution adopted by a majority of the full board of directors, may appoint
one or more committees of two or more directors each. Such committees may
exercise such authority of the Board of Directors in the business and affairs
of the Corporation as the Board of Directors may, by resolution duly adopted,
delegate, except as prohibited by law. The designation of any committee and
the delegation thereto of authority shall not operate to relieve the Board of
Directors, or any member thereof, of any responsibility imposed on it or him by
law. Any member of a committee may be removed at any time by the Board of
Directors. Members of any such committees shall receive such compensation as
may be approved by the Board of Directors and will be reimbursed for reasonable
expenses actually incurred by reason of membership on a committee.
SECTION 4.14 RELATED PARTY TRANSACTIONS. All transactions between
the Corporation or any subsidiary, on the one hand, and its stockholders,
officers or directors (or relatives thereof, or corporations or other business
organizations owned or controlled by, any such stockholder, officer or
director), on the other hand, other than transactions in their capacity as
stockholders, officers, directors or employees of the Corporation, shall
require approval of five-sevenths (5/7) of the Board
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of Directors and shall be on terms no less favorable than those available at
the same time from non-affiliated third parties.
SECTION 4.15 ISSUANCE OF COMMON STOCK. Without the prior approval
in each instance of at least five-sevenths (5/7) of the Board of Directors, the
Corporation shall not, and shall not cause or permit any subsidiary to, issue,
sell or redeem any of its Common Stock or other equity securities (including
any securities directly or indirectly convertible into or exchangeable with the
Common Stock), and if such Common Stock or other securities are to be issued
for consideration other than cash, the consideration paid must be pursuant to
valuation tests reasonably satisfactory to at least five-sevenths (5/7) of the
Board of Directors, except as otherwise permitted by the Certificate of
Incorporation.
SECTION 4.16 CHANGE IN CORPORATE STRUCTURE; SALE OF ASSETS.
Without the prior approval in each instance of at least five-sevenths (5/7) of
the Board of Directors, the Corporation will not (and will not cause or permit
any subsidiary to) (i) permit its Certificate of Incorporation or Bylaws to be
amended; (ii) consolidate or merge with any other corporation (except that any
subsidiary may merge into or consolidate with the Corporation or another
subsidiary of the Corporation); or (iii) sell, lease or otherwise dispose of
all or substantially all of its properties and assets, other than in the
ordinary course of business consistent with past practice.
SECTION 4.17 INDEBTEDNESS. Without the prior approval in each instance
of at least five-sevenths (5/7ths) of the members of the Board of Directors of
the Corporation, the Corporation shall not (and shall not cause or permit any
Subsidiary to) directly or indirectly create, incur, assume, guarantee or be or
remain liable with respect to any indebtedness or liabilities, except for:
(i) indebtedness for borrowed money from the
Corporation's senior lenders;
(ii) accounts payable and similar liabilities,
deferred taxes, and leases of real or personal property, in
each case incurred in the ordinary course of business of the
Corporation and subsidiaries;
(iii) purchase money indebtedness incurred in
connection with the capital expenditures permitted in
connection with the following: (i) any single capital
expenditure not in excess of $500,000, or capital expenditures
which for the Corporation and all subsidiaries does not exceed
$1,000,000 in the aggregate during any fiscal year; or (ii)
any interest in real estate or contract for the construction
or renovation of any capital improvements to real estate, in
the case of any single project having an aggregate cost not
exceeding $1,500,000. For purposes hereof, capital
expenditures shall include acquisitions pursuant to
capitalized leases.
SECTION 4.18 ACQUISITIONS. All acquisitions following the
closing by the Corporation or any subsidiary of any hospital, medical building
or complex or any similar medical facility will require the approval of
five-sevenths (5/7ths) of the members of the Board of Directors of the
Corporation.
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ARTICLE V
OFFICERS
SECTION 5.1. NUMBER. The officers of the Corporation shall
consist of a president, one or more vice presidents, a secretary and a
treasurer; and, in addition, such other officers and assistant officers and
agents as may be deemed necessary or desirable. Officers shall be elected or
appointed by the Board of Directors. Any two or more offices may be held by
the same person. In its discretion, the Board of Directors may leave unfilled
any office except those of president, treasurer and secretary.
SECTION 5.2. ELECTION; TERM; QUALIFICATION. Officers shall
be chosen by the Board of Directors annually at the meeting of the Board of
Directors following the annual stockholders' meeting. Each officer shall hold
office until his successor has been chosen and qualified, or until his death,
resignation, or removal.
SECTION 5.3. REMOVAL. Any officer or agent elected or
appointed by the Board of Directors may be removed by the Board of Directors
whenever in its judgment the best interests of the Corporation will be served
thereby; but, such removal shall be without prejudice to the contract rights,
if any, of the person so removed. Election or appointment of an officer or
agent shall not of itself create any contract rights.
SECTION 5.4. VACANCIES. Any vacancy in any office for any
cause may be filled by the Board of Directors at any meeting.
SECTION 5.5. DUTIES. The officers of the Corporation shall
have such powers and duties, except as modified by the Board of Directors, as
generally pertain to their offices, respectively, as well as such powers and
duties as from time to time shall be conferred by the Board of Directors and by
these Bylaws.
SECTION 5.6. THE PRESIDENT. The president shall have general
direction of the affairs of the Corporation and general supervision over its
several officers, subject however, to the control of the Board of Directors.
He shall at each annual meeting, and from time to time, report to the
stockholders and to the Board of Directors all matters within his knowledge
which, in his opinion, the interest of the Corporation may require to be
brought to the notice of such persons. He may sign, with the secretary or an
assistant secretary, any or all certificates of stock of the Corporation. He
shall preside at all meetings of the stockholders, shall sign and execute in
the name of the Corporation (i) all contracts or other instruments authorized
by the Board of Directors, and (ii) all contracts or instruments in the usual
and regular course of business, pursuant to Section 6.2 hereof, except in cases
when the signing and execution thereof shall be expressly delegated or
permitted by the Board or by these Bylaws to some other officer or agent of the
Corporation; and, in general, shall perform all duties incident to the office
of president, and such other duties as from time to time may be assigned to him
by the Board of Directors or as are prescribed by these Bylaws.
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SECTION 5.7. THE VICE PRESIDENTS. At the request of the
president, or in his absence or disability, the vice presidents, in the order
of their election, shall perform the duties of the president, and, when so
acting, shall have all the powers of, and be subject to all restrictions upon,
the president. Any action taken by a vice president in the performance of the
duties of the president shall be conclusive evidence of the absence or
inability to act of the president at the time such action was taken. The vice
presidents shall perform such other duties as may, from time to time, be
assigned to them by the Board of Directors or the president. A vice president
may sign, with the secretary or an assistant secretary, certificates of stock
of the Corporation.
SECTION 5.8. SECRETARY. The secretary shall keep the minutes
of all meetings of the stockholders and of the Board of Directors, in one or
more books provided for such purpose and shall see that all notices are duly
given in accordance with the provisions of these Bylaws or as required by law.
He shall be custodian of the corporate records and of the seal (if any) of the
Corporation and see, if the Corporation has a seal, that the seal of the
Corporation is affixed to all documents the execution of which on behalf of the
Corporation under its seal is duly authorized; shall have general charge of the
stock certificate books, transfer books and stock ledgers, and such other books
and papers of the Corporation as the Board of Directors may direct, all of
which shall, at all reasonable times, be open to the examination of any
director, upon application at the office of the Corporation during business
hours; and in general shall perform all duties and exercise all powers incident
to the office of the secretary and such other duties and powers as the Board of
Directors or the president from time to time may assign to or confer on him.
SECTION 5.9. TREASURER. The treasurer shall keep complete
and accurate records of account, showing at all times the financial condition
of the Corporation. He shall be the legal custodian of all money, notes,
securities and other valuables which may from time to time come into the
possession of the Corporation. He shall furnish at meetings of the Board of
Directors, or whenever requested, a statement of the financial condition of the
Corporation, and shall perform such other duties as these Bylaws may require or
the Board of Directors may prescribe.
SECTION 5.10. ASSISTANT OFFICERS. Any assistant secretary or
assistant treasurer appointed by the Board of Directors shall have power to
perform, and shall perform, all duties incumbent upon the secretary or
treasurer of the Corporation, respectively, subject to the general direction of
such respective officers, and shall perform such other duties as these Bylaws
may require or the Board of Directors may prescribe.
SECTION 5.11. SALARIES. The salaries or other compensation
of the officers shall be fixed from time to time by the Board of Directors. No
officer shall be prevented from receiving such salary or other compensation by
reason of the fact that he is also a director of the Corporation.
SECTION 5.12. BONDS OF OFFICERS. The Board of Directors may
secure the fidelity of any officer of the Corporation by bond or otherwise, on
such terms and with such surety or sureties, conditions, penalties or
securities as shall be deemed proper by the Board of Directors.
SECTION 5.13. DELEGATION. The Board of Directors may
delegate temporarily the powers and duties of any officer of the Corporation,
in case of his absence or for any other reason,
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to any other officer, and may authorize the delegation by any officer of the
Corporation of any of his powers and duties to any agent or employee, subject
to the general supervision of such officer.
ARTICLE VI
MISCELLANEOUS
SECTION 6.1. DIVIDENDS. Dividends on the outstanding shares
of the Corporation, subject to the provisions of the Certificate of
Incorporation, if any, may be declared by the Board of Directors at any regular
or special meeting, pursuant to law. Dividends may be paid by the Corporation
in cash, in property, or in the Corporation's own shares, but only out of the
surplus of the Corporation, except as otherwise allowed by law.
Subject to limitations upon the authority of the Board of Directors
imposed by law or by the Certificate of Incorporation, the declaration of and
provision for payment of dividends shall be at the discretion of the Board of
Directors.
SECTION 6.2. CONTRACTS. The president shall have the power
and authority to execute, on behalf of the Corporation, contracts or
instruments in the usual and regular course of business, and in addition the
Board of Directors or the President may authorize any officer or officers,
agent or agents, of the Corporation to enter into any contract or execute and
deliver any instruments in the name of and on behalf of the Corporation, and
such authority may be general or confined to specific instances. Unless so
authorized by the Board of Directors or by these Bylaws, no officer, agent or
employee shall have any power or authority to bind the Corporation by any
contract or engagement, or to pledge its credit or to render it pecuniarily
liable for any purpose or in any amount.
SECTION 6.3. CHECKS, DRAFTS, ETC. All checks, drafts, or
other orders for the payment of money, notes, or other evidences of
indebtedness issued in the name of the Corporation shall be signed by such
officers or employees of the Corporation as shall from time to time be
authorized pursuant to these Bylaws or by resolution of the Board of Directors.
SECTION 6.4. DEPOSITORIES. All funds of the Corporation
shall be deposited from time to time to the credit of the Corporation in such
banks or other depositories as the Board of Directors may from time to time
designate, and upon such terms and conditions as shall be fixed by the Board of
Directors. The Board of Directors may from time to time authorize the opening
and maintaining within any such depository as it may designate, of general and
special accounts, and may make such special rules and regulations with respect
thereto as it may deem expedient.
SECTION 6.5. ENDORSEMENT OF STOCK CERTIFICATES. Subject to
the specific directions of the Board of Directors, any share or shares of stock
issued by any corporation and owned by the Corporation, including reacquired
shares of the Corporation's own stock, may, for sale or transfer, be endorsed
in the name of the Corporation by the president or any vice president; and such
endorsement may be attested or witnessed by the secretary or any assistant
secretary either with or without the affixing thereto of the corporate seal.
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SECTION 6.6. CORPORATE SEAL. The corporate seal, if any,
shall be in such form as the Board of Directors shall approve, and such seal,
or a facsimile thereof, may be impressed on, affixed to, or in any manner
reproduced upon, instruments of any nature required to be executed by officers
of the Corporation.
SECTION 6.7. FISCAL YEAR. The fiscal year of the Corporation
shall begin and end on such dates as the Board of Directors at any time shall
determine.
SECTION 6.8. BOOKS AND RECORDS. The Corporation shall keep
correct and complete books and records of account and shall keep minutes of the
proceedings of its stockholders and Board of Directors, and shall keep at its
registered office or principal place of business, or at the office of its
transfer agent or registrar, a record of its stockholders, giving the names and
addresses of all stockholders and the number and class of the shares held by
each.
SECTION 6.9. RESIGNATIONS. Any director or officer may
resign at any time. Such resignations shall be made in writing and shall take
effect at the time specified therein, or, if no time is specified, at the time
of its receipt by the president or secretary. The acceptance of a resignation
shall not be necessary to make it effective, unless expressly so provided in
the resignation.
SECTION 6.10. MEETINGS BY TELEPHONE. Subject to the
provisions required or permitted by these Bylaws or the laws of the State of
Delaware for notice of meetings, members of the Board of Directors, or members
of any committee designated by the Board of Directors, may participate in and
hold any meeting required or permitted under these Bylaws by telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other. Participation in a meeting pursuant to this
Section shall constitute presence in person at such a meeting, except where a
person participates in the meeting for the express purpose of objecting, at the
beginning of the meeting, to the transaction of any business on the ground that
the meeting is not lawfully called or convened.
SECTION 6.11. CONFLICT WITH CERTIFICATE OF INCORPORATION.
Any provision in these Bylaws to the contrary notwithstanding, should any Bylaw
conflict with any provision in the Certificate of Incorporation of the
Corporation, as amended, including without limitation any such provision
governing a change of control of the Corporation's Board of Directors upon the
occurrence of certain events specified therein, then such provision of said
Certificate of Incorporation, as amended, shall be controlling, and the
remainder of these Bylaws shall be construed so as to comply with said
Certificate of Incorporation.
ARTICLE VII
INDEMNITIES
SECTION 7.1. DEFINITIONS. In this Article:
(a) "Indemnitee" means (i) any present or former Director, advisory
director or officer of the Corporation, (ii) any person who while serving in
any of the capacities referred to in clause (i) hereof
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<PAGE> 15
served at the Corporation's request as a director, officer, partner, venturer,
proprietor, trustee, employee, agent or similar functionary of another foreign
or domestic corporation, partnership, joint venture, trust, employee benefit
plan or other enterprise, and (iii) any person nominated or designated by (or
pursuant to authority granted by) the Board of Directors or any committee
thereof to serve in any of the capacities referred to in clauses (i) or (ii)
hereof.
(b) "Official Capacity" means (i) when used with respect to a
Director, the office of Director of the Corporation, and (ii) when used with
respect to a person other than a Director, the elective or appointive office of
the Corporation held by such person or the employment or agency relationship
undertaken by such person on behalf of the Corporation, but in each case does
not include service for any other foreign or domestic corporation or any
partnership, joint venture, sole proprietorship, trust, employee benefit plan
or other enterprise.
(c) "Proceeding" means any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative, arbitrative or
investigative, any appeal in such an action, suit or proceeding, and any
inquiry or investigation that could lead to such an action, suit or proceeding.
SECTION 7.2. INDEMNIFICATION. The Corporation shall
indemnify every Indemnitee against all judgments, penalties (including excise
and similar taxes), fines, amounts paid in settlement and reasonable expenses
actually incurred by the Indemnitee in connection with any Proceeding to which
he was, is or is threatened to be named defendant or respondent, or in which he
was or is a witness without being named a defendant or respondent, by reason,
in whole or in part, of his serving or having served, or having been nominated
or designated to serve, in any of the capacities referred to in Section 7.1(a),
if it is determined in accordance with Section 7.4 that the Indemnitee (a)
conducted himself in good faith, (b) reasonably believed, in the case of
conduct in his Official Capacity, that his conduct was in the Corporation's
best interests and, in all other cases, that his conduct was at least not
opposed to the Corporation's best interests, and (c) in the case of any
criminal proceeding, had no reasonable cause to believe that his conduct was
unlawful; provided, however, that in the event a determination is made that a
person is entitled to indemnification pursuant to this Section 7.2 in
connection with a Proceeding brought by or on behalf of the Corporation, such
indemnification shall be limited to the reasonable expenses (including court
costs and attorneys' fees) actually incurred by the Indemnitee in connection
with the Proceeding. No indemnification shall be made under this Section 7.2
in respect of any judgment, penalty, fine or amount paid in settlement in
connection with any Proceeding in which such Indemnitee shall have been found
liable to the Corporation. If a director is found liable on the basis that
personal benefit was improperly received by him, whether or not the benefit
resulted from an action taken in the Indemnitee's Official Capacity, then
indemnification can be made only if the indemnification (x) is limited to
reasonable expenses and (y) shall not be made if the director is found liable
for willful or intentional misconduct in performing his duties to the
Corporation. The termination of any Proceeding by judgment, order, settlement
or conviction, or on a plea of nolo contendere or its equivalent, is not of
itself determinative that the Indemnitee did not meet the requirements set
forth in clauses (a), (b) or (c) in the first sentence of this Section 7.2.
SECTION 7.3. SUCCESSFUL DEFENSE. Without limitation of
Section 7.2 and in addition to the indemnification provided for in Section 7.2,
the Corporation shall indemnify every Indemnitee
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<PAGE> 16
against reasonable expenses incurred by such person in connection with any
Proceeding in which he is a witness or a named defendant or respondent because
he served in any of the capacities referred to in Section 7.1(a), if such
person has been wholly successful, on the merits or otherwise, in defense of
the Proceeding.
SECTION 7.4. DETERMINATIONS. Any indemnification under
Section 7.2 (unless ordered by a court of competent jurisdiction) shall be made
by the Corporation only upon a determination that indemnification of the
Indemnitee is proper in the circumstances because he has met the applicable
standard of conduct. Such determination shall be made (a) by the Board of
Directors by a majority vote of the directors who are not parties or
respondents in the Proceeding, even though less than a quorum; (b) by special
legal counsel selected by the Board of Directors by vote as set forth in clause
(a) of this Section 7.4 or, if all of the Directors are named defendants or
respondents in the Proceeding by a majority vote of all of the Directors; or
(c) by the stockholders in a vote that excludes the shares held by Directors
that are named defendants or respondents in the Proceeding. Determination as
to reasonableness of expenses shall be made in the same manner as the
determination that indemnification is permissible, except that if the
determination that indemnification is permissible is made by special legal
counsel, determination as to reasonableness of expenses must be made in the
manner specified in clause (b) of the preceding sentence for the selection of
special legal counsel. In the event a determination is made under this Section
7.4 that the Director or officer has met the applicable standard of conduct as
to some matters but not as to others, amounts to be indemnified may be
reasonably prorated.
SECTION 7.5. ADVANCEMENT OF EXPENSES. Reasonable expenses
(including court costs and attorneys' fees) incurred by an Indemnitee who was
or is a witness or was, is or is threatened to be made a named defendant or
respondent in a Proceeding shall be paid by the Corporation at reasonable
intervals in advance of the final disposition of such Proceeding upon receipt
by the Corporation of (a) a written affirmation by such Indemnitee of his good
faith belief that he has met the standard of conduct necessary for
indemnification by the Corporation under this Article and (b) a written
undertaking by or on behalf of such Indemnitee to repay the amount paid or
reimbursed by the Corporation if it shall ultimately be determined that he is
not entitled to be indemnified by the Corporation as authorized in this
Article. Such written undertaking shall be an unlimited obligation of the
Indemnitee but need not be secured and it may be accepted without reference to
financial ability to make repayment. Notwithstanding any other provision of
this Article, the Corporation may pay or reimburse expenses incurred by an
Indemnitee in connection with his appearance as a witness or other
participation in a Proceeding at a time when he is not named a defendant or
respondent in the Proceeding.
SECTION 7.6. EMPLOYEE BENEFIT PLANS. For purposes of this
Article, the Corporation shall be deemed to have requested an Indemnitee to
serve an employee benefit plan whenever the performance by him of his duties to
the Corporation also imposes duties on or otherwise involves services by him to
the plan or participants or beneficiaries of the plan. Excise taxes assessed
on an Indemnitee with respect to an employee benefit plan pursuant to
applicable law shall be deemed fines. Action taken or omitted by an Indemnitee
with respect to an employee benefit plan in the performance of his duties for a
purpose reasonably believed by him to be in the interest of the participants
and
-16-
<PAGE> 17
beneficiaries of the plan shall be deemed to be for a purpose which is not
opposed to the best interests of the Corporation.
SECTION 7.7. OTHER INDEMNIFICATION AND INSURANCE. The
indemnification provided by this Article shall (a) not be deemed exclusive of,
or to preclude, any other rights to which those seeking indemnification may at
any time be entitled under the Corporation's Certificate of Incorporation, any
law, agreement or vote of stockholders or disinterested Directors, or
otherwise, or under any policy or policies of insurance purchased and
maintained by the Corporation on behalf of any Indemnitee or under any self-
insurance arrangement allowed by law, both as to action in his Official
Capacity and as to action in any other capacity, (b) continue as to a person
who has ceased to be in the capacity by reason of which he was an Indemnitee
with respect to matters arising during the period he was in such capacity, and
(c) inure to the benefit of the heirs, executors and administrators of such a
person.
SECTION 7.8. NOTICE. Any indemnification of or advance of
expenses to a present or former Director of the Corporation in accordance with
this Article shall be reported in writing to the stockholders of the
Corporation with or before the notice or waiver of notice of the next
stockholders' meeting or with or before the next submission to stockholders of
a consent to action without a meeting and, in any case, within the twelve-month
period immediately following the date of the indemnification or advance.
SECTION 7.9. CONSTRUCTION. The indemnification provided by
this Article shall be subject to all valid and applicable laws, including,
without limitation, Section 145 of the Delaware General Corporation Law, and,
in the event this Article or any of the provisions hereof or the
indemnification contemplated hereby are found to be inconsistent with or
contrary to any such valid laws, the latter shall be deemed to control and to
provide the fullest possible rights and privileges accorded thereby, and this
Article shall be regarded as modified accordingly, and, as so modified, to
continue in full force and effect.
SECTION 7.10. CONTINUING OFFER, RELIANCE, ETC. The
provisions of this Article (i) are for the benefit of, and may be enforced by,
each Director and officer of the Corporation, the same as if set forth in their
entirety in a written instrument duly executed and delivered by the Corporation
and such Director or officer and (ii) constitute a continuing offer to all
present and future Directors and officers of the Corporation. The Corporation,
by its adoption of these Bylaws, (i) acknowledges and agrees that each present
and future Director and officer of the Corporation has relied upon and will
continue to rely upon the provisions of this Article in accepting and serving
in any of the capacities referred to in Section 7.1(a) of this Article, (ii)
waives reliance upon, and all notices of acceptance of, such provisions by such
Directors and officers and (iii) acknowledges and agrees that no present or
future Director or officer of the Corporation shall be prejudiced in his right
to enforce the provisions of this Article in accordance with their terms by any
act or failure to act on the part of the Corporation.
SECTION 7.11. EFFECT OF AMENDMENT. No amendment,
modification or repeal of this Article or any provision hereof shall in any
manner terminate, reduce or impair the right of any past, present or future
Director or officer of the Corporation to be indemnified by the Corporation,
nor the
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<PAGE> 18
obligation of the Corporation to indemnify any such Director or officer, under
and in accordance with the provisions of the Article as in effect immediately
prior to such amendment, modification or repeal with respect to claims arising
from or relating to matters occurring, in whole or in part, prior to such
amendment, modification or repeal, regardless of when such claims may arise or
be asserted.
ARTICLE VIII
AMENDMENTS
SECTION 8.1. AMENDMENTS. These Bylaws, subject to Article 4,
may be altered, amended or repealed, or new bylaws may be adopted, by the
Directors at any duly held meeting or by the holders of a majority of the
shares represented at any duly held meeting of stockholders; provided that
notice of such proposed action shall have been contained in the notice of any
such meeting.
[Including all amendments through and including May 25, 1995.]
----------------------------------------
James G. VanDevender, Secretary
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<PAGE> 1
EXHIBIT 4.3
General Description of
Champion Healthcare Corporation
Common Stock Certificate
The front of the certificate is engraved with blue ornamental border
and additional blue ornamentation upon white paper, bearing a stylized letter
design of the words "Champion Healthcare Corporation" in dark blue and
substantive text in black.
The back of the certificate bears no border and no ornamentation
except for the stylized letter design of the words "Champion Healthcare
Corporation" in black. All text is in black.
<PAGE> 2
[Form of Common Stock Certificate]
[Front]
<TABLE>
<CAPTION>
CHAMPION HEALTHCARE
CORPORATION
Number
CHC Shares
- ----- ------
<S> <C> <C>
COMMON STOCK
THIS CERTIFICATE IS TRANSFERABLE INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE CUSIP 15850B 10 4
IN NEW YORK, NEW YORK SEE REVERSE FOR CERTAIN DEFINITIONS
THIS CERTIFIES THAT
is the owner of
FULLY PAID AND NON-ASSESSABLE COMMON SHARES, WITH A PAR VALUE OF $.01 PER SHARE, OF
</TABLE>
Champion Healthcare Corporation transferable in person or by duly authorized
attorney on the books of the Corporation upon surrendering of this certificate
properly endorsed. This certificate is not valid until countersigned and
registered by the Transfer Agent and Registrar.
WITNESS the facsimile seal of the Corporation and the facsimile signatures of
its duly authorized officers.
CERTIFICATE OF STOCK
Dated:
<TABLE>
<S> <C> <C>
/s/Charles R. Miller
President Countersigned and Registered:
/s/James G. VanDevender [FACSIMILE CORPORATE SEAL] MELLON SECURITIES TRUST COMPANY
Secretary (NEW YORK)
Transfer Agent and Registrar
By:
Authorized Signature
</TABLE>
<PAGE> 3
[Form of Common Stock Certificate]
[Back]
CHAMPION HEALTHCARE
CORPORATION
The Company will furnish upon request and without charge to each
stockholder the powers, designations, preferences and relative participating,
optional and other special rights of each class of stock and series within a
class of stock of the Company, as well as the qualifications, limitations and
restrictions relating to those preferences and/or rights. A stockholder may
make the request to the Company or to its Transfer Agent and Registrar.
The following abbreviations, when used in the inscription on
the fact of this certificate, shall be construed as though they were
written out in full according to applicable laws or regulations:
<TABLE>
<S> <C>
TEN COMM -- as tenants in common UNIF GIFT MIN ACT -- ______ Custodian _______
TEN ENT -- as tenants by the entireties (Cust) (Minor)
JT TEN -- as joint tenants with right
of survivorship and not as under Uniform Gifts to Minors
tenants in common Act _________________________
(State)
</TABLE>
Additional abbreviations may also be used though not in the above list.
For value received, ________________________________________
hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- --------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Please print or typewrite name and address including postal zip code of assignee
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Shares
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------------
of the Stock represented by the within Certificate, and do hereby irrevocably
constitute and appoint
- --------------------------------------------------------------------------------
Attorney to transfer the said stock on the books of the within-named Company
with full power of substitution in the premises.
Dated
------------------------------
X
-----------------------------------
NOTICE (Signature)
THE SIGNATURE(S) TO THIS
ASSIGNMENT MUST CORRES-
POND WITH THE NAME(S) AS
WRITTEN UPON THE FACE OF
THE CERTIFICATE IN EVERY
PARTICULAR WITHOUT ALTER-
ATION OR ENLARGEMENT OR
ANY CHANGE WHATEVER X
NOTICE -----------------------------------
(Signature)
THE SIGNATURE(S) SHOULD BE
GUARANTEED BY AN ELIGIBLE GUARANTOR
INSTITUTION (BANKS, STOCKBROKERS,
SAVINGS AND LOAN ASSOCIATIONS AND
CREDIT UNIONS WITH MEMBERSHIP IN AN
APPROVED SIGNATURE GUARANTEE
MEDALLION PROGRAM), PURSUANT TO
S.E.C. RULE 17Ad-15
SIGNATURE(S) GUARANTEED BY:
<PAGE> 1
EXHIBIT 4.4
CHAMPION HEALTHCARE CORPORATION
DECEMBER 1990
FOUNDER'S STOCK OPTION AGREEMENT
This Agreement is entered into and made effective this 31st day of
December, 1990, by and between CHAMPION HEALTHCARE CORPORATION, a Texas
corporation (hereinafter referred to as the "Company") and CHARLES R. MILLER
(hereinafter referred to as "Optionee").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has resolved to grant
the Optionee an option to purchase a portion of the shares of the Common Stock
of the Company;
NOW, THEREFORE, in consideration of the efforts of Optionee in founding
the Company and his execution of his Amended and Restated Employment Agreement
of even date herewith and the premises and mutual covenants hereinafter
contained, the parties hereto agree as follows:
1. OPTION TO PURCHASE STOCK. The Company does hereby grant to
Optionee the option to purchase Fifty-Four Thousand (54,000) shares of the
Company's Common Stock, no par value (hereinafter referred to as "Stock'), at a
purchase price of Two Dollars ($2.00) per share.
2. EXERCISE OF OPTION. Optionee may exercise said option in whole or in
part, for a period of ten (10) years, commencing on the effective date of this
Agreement.
3. MANNER OF EXERCISE. Said option shall be exercised in whole or in
part only by delivery to Company of a written notice that the option is being
exercised and Optionee shall deliver the total purchase price in cash or a
cashier's or certified check to
-1-
<PAGE> 2
Company. Upon receipt of payment for the Stock being purchased, the Company
shall, as expediently as possible, deliver to the Optionee at the principal
office of the Company, or at such other place as shall be mutually acceptable, a
certificate or certificates for the Stock being purchased.
4. RESTRICTIONS.
(a) Optionee shall have no right to encumber or to dispose of this
Option, and any attempted encumbrance or disposition shall be wholly void and
unenforceable against Company; provided however that the Option may be
transferred to the Estate of Optionee upon Optionee's death. No provision of
this Agreement shall be construed to, in any manner, obligate Optionee to
continue employment with Company for any particular period of time, or obligate
the Company to continue the employment of Optionee for any particular period of
time.
(b) The shares issued upon the exercise of this option shall have a
restrictive legend placed on the certificates evidencing said shares and
requiring the performance of the action set forth therein and there shall be
entered on the Company's books and records a stop transfer order against the
transfer of said share without compliance with said legend. The restrictive
legend shall be substantially as follows:
"These shares have not been registered under the
Securities Act of 1933 or any state securities laws,
and their sale, pledge or transfer is prohibited
without first submitting to the Company an opinion of
counsel acceptable to it that said sale, pledge or
transfer will not be in violation of applicable
federal or state securities laws."
5. NOTICE. Any notices to be given hereunder by either party to the
other may be personal delivery in writing or by mail, registered or certified,
postage prepaid with return receipt requested. Mailed notices shall be addressed
to the parties at the addresses
-2-
<PAGE> 3
appearing below or to the last known address of a party if the party giving
written notice has knowledge of a change in address. Any time limitation
provided for in this Agreement shall commence with the date that the party
actually received such written notice, and the date or postmark of any return
receipt indicating the date of delivery of such notice to the addressee shall be
conclusive evidence to such receipt.
To Company To Optionees
- ---------- ------------
Champion Healthcare Corporation Charles R. Miller
14340 Torrey Chase Boulevard 14340 Torrey Chase Boulevard
Suite 320 Suite 320
Houston, Texas 77014 Houston, Texas 77014
6. ASSIGNMENT. Except as specified below, neither Optionee nor anyone
claiming under him may commute, encumber or dispose of the option provided by
this Agreement. This Option may be exercised by the Estate of the Optionee or by
the beneficiary of such estate on the terms and conditions set forth herein.
Except as may be provided for herein such option is hereby declared to be
non-assignable and nontransferable by Optionee and, in the event of any
attempted assignment or transfer, Company shall have no further Liability
hereunder.
7. GOVERNING LAW. This Agreement shall be construed and governed in
accordance with the laws of the State of Texas. This Agreement is performable in
Harris County, Texas.
8. AMENDMENT. It is further agreed by the parties hereto that this
instrument contains the entire agreement between the parties, and that no
statements, promises or inducements made by either party hereto, which are not
contained in this instrument, shall be valid or binding, and that this Agreement
shall not be enlarged, modified, or altered except in writing and signed by the
parties hereto.
-3-
<PAGE> 4
9. SUCCESSORS. In the event of any recapitalization, stock split,
dividend, merger, or other transaction affecting either the number of
outstanding shares of Stock or the fair market value of a share of Stock, the
Company shall make appropriate adjustments to the total number of shares of
Stock that may become subject to options granted pursuant to this Plan, the
number of shares of Stock covered by outstanding options, and the Option Price
of such Stock.
10. PROTECTION AGAINST VIOLATIONS OF AGREEMENT. No purported sale,
assignment, mortgage, hypothecation, transfer, pledge, encumbrance, gift,
transfer in trust (voting or other) or other disposition of, or creation of a
security interest in or Hen on, any of the stock by any holder thereof in
violation of the provisions of this agreement, or of the Articles of
Incorporation or the bylaws of the Company, will be valid, and the Company will
not transfer any of said shares on its books, unless and until there has been
compliance with said provisions. The foregoing restrictions are in addition to
and not in lieu of any other remedies, legal or equitable, available to enforce
said provisions.
11. BENEFITS. The terms and provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors and assigns.
12. ANTI-DILUTION. In the event of a stock dividend, split-up or
combination of shares, merger, consolidation, reorganization, recapitalization
or other change in the corporate structure or capitalization affecting the
outstanding Common Stock of the Company, an appropriate adjustment shall be made
to the price and number or kind of shares covered by the stock option agreement.
-4-
<PAGE> 5
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first above written.
COMPANY:
CHAMPION HEALTHCARE CORPORATION
By:
-------------------------------
James G. VanDevener, Vice President
OPTIONEE:
-----------------------------------
Charles R. Miller
-5-
<PAGE> 1
EXHIBIT 4.5
CHAMPION HEALTHCARE CORPORATION
DECEMBER 1990
FOUNDER'S STOCK OPTION AGREEMENT
This Agreement is entered into and made effective this 31st day of
December, 1990, by and between CHAMPION HEALTHCARE CORPORATION, a Texas
corporation (hereinafter referred to as the "Company") and JAMES G. VANDEVENDER
(hereinafter referred to as "Optionee").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has resolved to grant
the Optionee an option to purchase a portion of the shares of the Common Stock
of the Company;
NOW, THEREFORE, in consideration of the efforts of Optionee in founding
the Company and his execution of his Amended and Restated Employment Agreement
of even date herewith and the premises and mutual covenants hereinafter
contained, the parties hereto agree as follows:
1. OPTION TO PURCHASE STOCK The Company does hereby grant to Optionee
the option to purchase Thirty-Six Thousand (36,000) shares of the Company's
Common Stock, no par value (hereinafter referred to as "Stock"), at a purchase
price of Two Dollars ($2.00) per share.
2. EXERCISE OF OPTION. Optionee may exercise said option in whole or in
part, for a period of ten (10) years, commencing on the effective date of this
Agreement.
3. MANNER OF EXERCISE. Said option shall be exercised in whole or in
part only by delivery to Company of a written notice that the option is being
exercised and Optionee shall deliver the total purchase price in cash or a
cashier's or certified check to
-1-
<PAGE> 2
Company. Upon receipt of payment for the Stock being purchased, the Company
shall, as expediently as possible, deliver to the Optionee at the principal
office of the Company, or at such other place as shall be mutually acceptable, a
certificate or certificates for the Stock being purchased.
4. RESTRICTIONS.
(a) Optionee shall have no right to encumber or to dispose of this
Option, and any attempted encumbrance or disposition shall be wholly void and
unenforceable against Company; provided however that the Option may be
transferred to the Estate of Optionee upon Optionee's death. No provision of
this Agreement shall be construed to, in any manner, obligate Optionee to
continue employment with Company for any particular period of time, or obligate
the Company to continue the employment of Optionee for any particular period of
time.
(b) The shares issued upon the exercise of this option shall have a
restrictive legend placed on the certificates evidencing said shares and
requiring the performance of the action set forth therein and there shall be
entered on the Company's books and records a stop transfer order against the
transfer of said share without compliance with said legend. The restrictive
legend shall be substantially as follows:
"These shares have not been registered under the
Securities Act of 1933 or any state securities laws,
and their sale, pledge or transfer is prohibited
without first submitting to the Company an opinion of
counsel acceptable to it that said sale, pledge or
transfer will not be in violation of applicable
federal or state securities laws."
5. NOTICE. Any notices to be given hereunder by either party to the
other may be personal delivery in writing or by mail, registered or certified,
postage prepaid with return receipt requested. Mailed notices shall be
addressed to the parties at the addresses
-2-
<PAGE> 3
appearing below or to the last known address of a party if the party giving
written notice has knowledge of a change in address. Any time limitation
provided for in this Agreement shall commence with the date that the party
actually received such written notice, and the date or postmark of any return
receipt indicating the date of delivery of such notice to the addressee shall be
conclusive evidence to such receipt.
To Company To Optionees
- ---------- ------------
Champion Healthcare Corporation James G. VanDevender
14340 Torrey Chase Boulevard 14340 Torrey Chase Boulevard
Suite 320 Suite 320
Houston, Texas 77014 Houston, Texas 77014
6. ASSIGNMENT. Except as specified below, neither Optionee nor anyone
claiming under him may commute, encumber or dispose of the option provided by
this Agreement. This Option may be exercised by the Estate of the Optionee or by
the beneficiary of such estate on the terms and conditions set forth herein.
Except as may be provided for herein such option is hereby declared to be
non-assignable and nontransferable by Optionee and, in the event of any
attempted assignment or transfer, Company shall have no further Liability
hereunder.
7. GOVERNING LAW. This Agreement shall be construed and governed in
accordance with the laws of the State of Texas. This Agreement is performable in
Harris County, Texas.
8. AMENDMENT. It is further agreed by the parties hereto that this
instrument contains the entire agreement between the parties, and that no
statements, promises or inducements made by either party hereto, which are not
contained in this instrument, shall be valid or binding, and that this Agreement
shall not be enlarged, modified, or altered except in writing and signed by the
parties hereto.
-3-
<PAGE> 4
9. SUCCESSORS. In the event of any recapitalization, stock split,
dividend, merger, or other transaction affecting either the number of
outstanding shares of Stock or the fair market value of a share of Stock, the
Company shall make appropriate adjustments to the total number of shares of
Stock that may become subject to options granted pursuant to this Plan, the
number of shares of Stock covered by outstanding options, and the Option Price
of such Stock.
10. PROTECTION AGAINST VIOLATIONS OF AGREEMENT. No purported sale,
assignment, mortgage, hypothecation, transfer, pledge, encumbrance, gift,
transfer in trust (voting or other) or other disposition of, or creation of a
security interest in or Hen on, any of the stock by any holder thereof in
violation of the provisions of this agreement, or of the Articles of
Incorporation or the bylaws of the Company, will be valid, and the Company will
not transfer any of said shares on its books, unless and until there has been
compliance with said provisions. The foregoing restrictions are in addition to
and not in lieu of any other remedies, legal or equitable, available to enforce
said provisions.
11. BENEFITS. The terms and provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legal representatives, successors and assigns.
12. ANTI-DILUTION. In the event of a stock dividend, split-up or
combination of shares, merger, consolidation, reorganization, recapitalization
or other change in the corporate structure or capitalization affecting the
outstanding Common Stock of the Company, an appropriate adjustment shall be made
to the price and number or kind of shares covered by the stock option agreement.
-4-
<PAGE> 5
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first above written.
COMPANY:
CHAMPION HEALTHCARE CORPORATION
By:
----------------------------
Charles R. Miller, President
OPTIONEE:
-------------------------------
James G. VanDevender
-5-
<PAGE> 1
EXHIBIT 4.6
CHAMPION HEALTHCARE CORPORATION
EMPLOYEE STOCK OPTION PLAN
PREAMBLE. The Board of Directors of Champion Healthcare Corporation adopted the
hereinbelow described Employee Stock Option Plan effective as of December 31,
1991 and it was approved by the shareholders with an effective date for all
purposes of December 31, 1991.
1. Purpose.
The purpose of this Employee Stock Option Plan (the "Plan") is to give
officers and executive personnel ("key employees") of Champion Healthcare
Corporation, a corporation (the "Company") , and corporations with respect to
which the Company directly or indirectly controls 50% or more of the combined
voting power ("subsidiaries") , an opportunity to acquire shares of the common
stock of the Company, no par value ("Common Stock") , to provide an incentive
for key employees to continue to promote the best interests of the Company and
enhance its long-term performance, and to provide an incentive for key
employees to join or remain with the Company and its subsidiaries.
2. Administration.
(a) Board of Directors. The Plan shall be administered by the
Board of Directors of the Company (the "Board"), which, to the
extent it shall determine, may delegate its powers with
respect to the administration of the Plan (except its powers
under Section 12 (c) ) to a committee of directors (the
"Committee") appointed by the Board and composed of not less
than two members of the Board. If the Board chooses to appoint
a Committee, references hereinafter to the Board (except in
Section 12(c)) shall be deemed to refer to the Committee.
Notwithstanding the preceding provisions of the Section, no
member of the Board may exercise discretion with respect to,
or participate in, the administration of the Plan if, at any
time while serving on the Committee or within one year prior
to such exercise or participation, he or she has received
stock, stock options or stock appreciation rights pursuant to
the Plan or any other plan of the Company or any affiliate
thereof entitling the participants therein to acquire stock,
stock options or stock apprecia-
<PAGE> 2
tion rights of the Company or of any of its affiliates.
(b) Powers. Within the limits of the express provisions of the
Plan, the Board shall determine: (i) the key employees to whom
awards hereunder shall be granted, (ii) the time or times at
which such awards shall be granted, (iii) the form and amount
of the awards, and (iv) the limitations, restrictions and
conditions applicable to any such award. In making such
determinations, the Board may take into account the nature of
the services rendered by such employees, or classes of
employees, their present and potential contributions to the
Company" s success and such other factors as the Board in its
discretion shall deem relevant.
(c) Interpretations. Subject to the express provisions of the
Plan, the Board may interpret the Plan, prescribe, amend and
rescind rules and regulations relating to it, determine the
terms and provisions of the respective awards and make all
other determinations it deems necessary or advisable for the
administration of the Plan.
(d) Determinations. The determinations of the Board on all matters
regarding the Plan shall be conclusive. A member of the Board
shall only be liable for any action taken or determination
made in bad faith.
(e) Nonuniform Determinations. The Board's determinations under
the Plan, including without limitation, determinations as to
the persons to receive awards, the terms and provisions of
such awards and the agreements evidencing the same, need not
be uniform and may be made by it selectively among persons who
receive or are eligible to receive awards under the Plan,
whether or not such persons are similarly situated.
<PAGE> 3
3. Awards Under the Plan.
(a) Type of Award. Awards under the Plan may be granted in any
either or both of the following forms: (i) Nonstatutory Stock
Options, as described in Section 4, and (ii) Stock
Appreciation Rights, as described in Section 6. Nonstatutory
Stock Options shall be referred to herein as "Stock Options."
(b) Maximum Limitations. The aggregate number of shares of Common
Stock available for grant under the Plan is 75, 000, subject
to adjustment pursuant to Section 8. Shares of Common Stock
issued pursuant to the Plan may be either authorized but
unissued shares or shares now or hereafter held in the
treasury of the Company. In the event that, prior to the end
of the period during which Stock Options may be granted under
the Plan, any Stock Option under the Plan expires unexercised
or is terminated, surrendered or canceled (other than in
connection with the exercise of a Stock Appreciation Right)
without being exercised, in whole or in part, for any reason,
the number of shares theretofore subject to such Stock Option
or the unexercised, terminated, forfeited or unearned portion
thereof, shall be added to the remaining number of shares of
Common Stock available for grant as a Stock Option under the
Plan, including a grant to a former holder of such Stock
Option, upon such terms and conditions as the Board shall
determine, which terms may be more or less favorable than
those applicable to such former Stock Option.
4. Stock Options.
(a) Conditions. Stock Options may be granted under the Plan for
the purchase of shares of Common Stock. Stock Options shall be
in such form and upon such terms and conditions as the Board
shall from time to time determine, subject to the following.
(i) Option Price. The option price of each Stock Option
to purchase Common Stock shall be determined by the
Board, but shall not be less than 100% of the fair
market value of the Common Stock subject to such
Stock Option on the date of grant.
<PAGE> 4
(ii) Term of Options. No Stock Option shall be exercisable
after the date ten (10) years and one (1) day f rom
the date such Stock Option is granted.
(iii) Conditions of Grant. The Board, in its discretion,
may, as a condition to the grant of a Stock Option,
require a key employee who is the recipient of such
Stock Option to enter into one or more of the
following agreements with the Company on or prior to
the date of grant of such Option:
a) A covenant not to compete with the Company
and it& subsidiaries which shall become
effective on the date of termination of
employment of the key employee with the
Company and which shall contain such terms
and conditions as shall be specified by the
Board;
b) An agreement to cancel any employment
agreement, fringe benefit or compensation
arrangement in effect between the Company and
the key employee.
c) The Shareholders' Agreement dated effective
December 31, 1990 among the Company and
Company Shareholders set forth in Schedule I
to that agreement.
If the key employee shall fail to enter into any such agreement at the request
of the Board, then no Stock Option shall be granted hereunder to such key
employee and the number of shares of Common Stock which would have been subject
to such Option shall be added to the remaining number of shares of Common Stock
available for grant as a Stock Option under the Plan.
(b) Form. The form of the stock option agreement shall subject to
paragraph (a) immediately above, be substantially in the form
as Exhibit 1 hereto.
<PAGE> 5
5. Provisions Applicable to Stock Options .
(a) Exercise. Stock Options shall be subject to such terms and
conditions, shall be exercisable at such time or times, and
shall be evidenced by such form of written option agreement
between the optionee and the Company, as the Board shall
determine; provided, that such determinations are not
inconsistent with the other provisions of the Plan.
(b) Manner of Exercise of 0ptions and Payment for Common Stock.
Stock Options may be exercised by an optionee by giving
written notice to the Secretary of the Company stating the
number of shares of Common Stock with respect to which the
Stock Option is being exercised and tendering payment
therefor. At the time that a Stock Option granted under the
Plan, or any part thereof, is exercised, payment for the
Common Stock issuable thereupon shall be made in full in cash
or by certified check or, if the Board in its discretion
agrees to accept, in shares of Common Stock of the Company
(the number of such shares paid for each share subject to the
Stock Option, or part thereof, being exercised shall be
determined by dividing the option price by the fair market
value per share of the Common Stock on the date of exercise).
As soon as reasonably possible following such exercise, a
certificate representing shares of Common Stock purchased,
registered in the name of the optionee, shall be delivered to
the optionee.
(c) Cancellation of Stock Appreciation Rights. The exercise of any
Stock Option shall cancel that number, if any, of Stock
Appreciation Rights (as defined in Section 6) included in such
Stock Option, which is equal to the excess of (i) the number
of shares of Common Stock subject to Stock Appreciation Rights
included in such Stock Option, over (ii) the number of shares
of Common Stock which remain subject to such Stock Option
after such exercise.
<PAGE> 6
6. Stock Appreciation Rights.
(a) Award. If deemed by the Board to be in the best interest of
the Company, any Stock Option granted under the Plan may
include a stock appreciation right ("Stock Appreciation
Right"), either at the time of grant or thereafter while the
Stock Option is outstanding.
(b) Terms of Rights. Stock Appreciation Rights shall be subject to
such terms and conditions not inconsistent with the other
provisions of the Plan as the Board shall determine; provided
that:
(i) Limitations. A Stock Appreciation Right shall
be exercisable to the extent, and only to the
extent, the Stock Option in which it is
included is exercisable and shall be
exercisable only for such period as the Board
may determine (which period may expire prior
to the expiration date of such Stock Option).
(ii) Surrender or Exchange. A Stock Appreciation
Right shall entitle the optionee to surrender
to the Company unexercised the Stock Option,
or portion thereof, to which it is related,
or any portion thereof, and to receive from
the Company in exchange therefor that number
of shares of Common Stock having an aggregate
fair market value equal to the excess of the
fair market value on the date of exercise of
one share of Common Stock over the option
price per share specified in such Stock
Option, multiplied by the number of shares of
Common Stock subject to the Stock Option, or
portion thereof, which is so surrendered. The
Board shall be entitled to elect to settle
any part or all of the Company's obligation
arising out of the exercise of a Stock
Appreciation Right by the payment to the
optionee of cash or by check equal to the
aggregate fair market value on the date on
which the Stock Appreciation Right is
exercised of that part or all of the shares
<PAGE> 7
of Common Stock the Company would otherwise
be obligated to deliver.
(c) Cash Settlement Restrictions.
(i) Notwithstanding Sections 6(b) and 9 hereof, so long
as the grantee of a Stock Appreciation Right is an
officer, an owner of 10% or more of an equity
security of the Company that is registered under the
Securities Exchange Act of 1934, or a director of the
Company, the Company" s right to elect to settle any
part or all of its obligation arising out of the
exercise of a Stock Appreciation Right by 'the
payment of cash or by check shall not apply unless
such exercise occurs either: (1) pursuant to the
provisions of subsection (ii) below, or (2) during
the period beginning on the third business day
following the date of release by the Company for
publication of its quarterly or annual summary
statements of sales and earnings and ending on the
twelfth business day following such date.
(ii) In the event that, pursuant to Section 9, the Company
shall cancel all unexercised Stock Options as of the
effective date of a merger or other transaction
provided therein or in the case of dissolution of the
Company, then each Stock Appreciation Right held by
an officer, an owner of 10% or more of an equity
security of the Company that is registered under the
Securities Exchange Act of 1934, or a director of the
Company, shall be automatically exercised on such
date within 30 days prior to the effective date of
such transaction or dissolution as the Board shall
determine and, in the absence of such determination,
on the last business day immediately prior to such
effective date.
<PAGE> 8
7. Transferability.
No Stock Option or Stock Appreciation Right may be transferred,
assigned, pledged or hypothecated (whether by operation of law or otherwise) ,
except as provided by will or the applicable laws of descent or distribution,
and no Stock Option or Stock Appreciation Right shall be subject to execution,
attachment or similar process. Any attempted assignment, transfer, pledge,
hypothecation or other disposition of a Stock Option or Stock Appreciation
Right, or levy of attachment or similar process upon the Stock Option or Stock
Appreciation Right not specifically permitted herein shall be null and void and
without effect. A Stock Option or Stock Appreciation Right may be exercised
only by a key employee during his or her lifetime, or pursuant to Section 11
(c) , by his or her estate or the person who acquires the right to exercise
such Stock Option or Stock Appreciation Right upon his or her death by bequest
or inheritance.
8. Adjustment Provisions.
The aggregate number of shares of Common Stock with respect to which
Stock Options and Stock Appreciation Rights may be granted, the aggregate
number of shares of Common Stock subject to each outstanding Stock Option and
Stock Appreciation Right, and the option price per share of each such Stock
Option, may all be appropriately adjusted as the Board may determine for any
increase or decrease in the number of shares of issued Common Stock resulting
from a subdivision or consolidation of shares, whether through reorganization,
recapitalization, stock split-up, stock distribution or combination of shares,
or the payment of a share dividend or other increase or decrease in the number
of such shares outstanding effected without receipt of consideration by the
Company. Adjustments under this Section 8 shall be made according to the sole
discretion of the Board, and its decisions shall be binding and conclusive.
9. Dissolution, Merger and Consolidation.
Except as otherwise provided in Section 6(c)(ii), upon the dissolution
or liquidation of the Company, or upon a merger or consolidation of the Company
in which the Company is not the surviving corporation, each Stock Option and
Stock Appreciation Right granted hereunder shall expire as of the effective
date of such transaction; provided, however, that the Board shall give at least
30 days prior written notice of such event to each optionee during which time
he or she shall have a right to exercise his or her (1) vested or (2) if
specifically provided in the option grant,
<PAGE> 9
vested and unvested, wholly or partially unexercised Stock Option (without
regard to installment exercise limitations, if any) or Stock Appreciation Right
and, subject to prior expiration pursuant to Section 11 (b) or (c) , each Stock
Option and Stock Appreciation Right shall be exercisable after receipt of such
written notice and prior to the effective date of such transaction.
10. Effective Date and Conditions Subsequent to Effective Date.
The Plan shall become effective on the date of the approval of the
Plan by the holders of a majority of the shares of Common Stock of the Company,
and the Plan shall be null and void and of no effect if such condition is not
fulfilled, and in such event each Stock Option or Stock Appreciation Right
granted hereunder shall, notwithstanding any of the preceding provisions of the
Plan, be null and void and of no effect. No grant or award shall be made under
the Plan more than ten (10) years from the date of shareholder approval hereof;
provided, however,' that the Plan and all Stock Options and Stock Appreciation
Rights granted under the Plan prior to such date shall remain in effect and
subject to adjustment and amendment as herein provided until they have been
satisfied or terminated in accordance with the terms of the respective grants
or awards and the related agreements.
11. Termination of Employment.
(a) Each Stock Option and Stock Appreciation Right shall, unless
sooner expired pursuant to Section 11 (b) or (c) below, expire
on the first to occur of the date one day after the tenth
anniversary of the date of grant thereof or the expiration
date set forth in the applicable option agreement.
(b) A Stock Option and Stock Appreciation Right shall expire on
the first to occur of the applicable date set forth in
paragraph (a) next above and the date that the employment of
the key employee with the Company and all subsidiaries
terminates for any reason other than death or disability. Upon
receipt of notice of termination of employment, whether
written or oral, Optionee shall not thereafter have the right
to exercise the Stock Option or Stock Appreciation Rights.
Notwithstanding the preceding provisions of this paragraph,
the Board, in its sole discretion, may, by written notice
given to a former employee, permit the former employee to
exercise Stock Options or Stock Appreciation Rights during
<PAGE> 10
a period following his or her termination of
employment, which period shall not exceed ninety (90)
days. In no event, however, may the Board permit a
former employee to exercise a Stock Option or Stock
Appreciation Right after the expiration date
contained in the agreement evidencing such Stock
Option or Stock Appreciation Right. Notwithstanding
the preceding provisions of this paragraph, if the
Board permits a former employee to exercise Stock
Options or Stock Appreciation Rights during a period
following his or her termination of employment
pursuant to such preceding provisions, such Stock
Options or Stock Appreciation Rights shall, to the
extent unexercised, expire on the date that such
former employee violates (as determined by the Board)
any covenant not to compete in effect between the
Company and/or its subsidiaries and the former
employee.
(c) If the employment of a key employee with the Company
and all subsidiaries terminates by reason of
disability (as determined by the Board) or by reason
of death, his or her Stock Options and Stock
Appreciation Rights, if any, shall expire on the
first to occur of the date set forth in paragraph (a)
of this Section 11 and the first anniversary of such
termination of employment.
12. Miscellaneous.
(a) Legal and Other Requirements. The obligation of the
Company to sell and deliver Common Stock under the
Plan shall be subject to all applicable laws,
regulations, rules and approvals, including, but not
by way of limitation, the effectiveness of a
registration statement under the Securities Act of
1933 if deemed necessary or appropriate by the
Company. Certificates for shares of Common Stock
issued hereunder may be legend as the Board shall
deem appropriate.
(b) No Obligation to Exercise Options. The granting of a
Stock Option shall impose no obligation upon an
optionee to exercise such Stock Option.
<PAGE> 11
(c) Termination and Amendment of Plan. The Board, without
further action on the part of the shareholders of the
Company, may from time to time alter, amend or
suspend the Plan or any Stock Option or Stock
Appreciation Right granted hereunder or may at any
time terminate the Plan, except that, unless approved
by the shareholders in accordance with Section 10
hereof, it may not (except to the extent provided in
Section 8 hereof) : (i) change the total number of
shares of Common Stock available for grant under the
Plan; (ii) extend the duration of the Plan; (iii)
increase the maximum term of Stock Options; or (iv)
change the class of employees eligible to be granted
Stock Options or Stock Appreciation Rights under the
Plan. No action taken by the Board under this Section
may materially and adversely affect any outstanding
Stock Option or Stock Appreciation Right without the
consent of the holder thereof.
(d) Application of Funds. The proceeds received by the
Company from the sale of Common Stock pursuant to
Stock Options will be used for general corporate
purposes.
(e) Withholding Taxes. Upon the exercise of any Stock
Option or Stock Appreciation Right, the Company shall
have the right to require the optionee to remit to
the Company an amount sufficient to satisfy an
federal, state and local withholding tax requirements
prior to the delivery of any certificate or
certificates for shares of Common Stock. Whenever
under the Plan payments are to be made by the Company
in cash or by check, such payments shall be net of
any amounts sufficient to satisfy all federal, state
and local withholding tax requirements.
(f) Right to Terminate Employment. Nothing in the Plan or
any agreement entered into pursuant to the Plan shall
confer upon any key employee or other optionee the
right to continue in the employment of the Company or
any subsidiary or affect any right which the Company
or any subsidiary may have to terminate the
employment of such key employee or other optionee.
<PAGE> 12
(g) Rights as a Shareholder. No optionee shall have any
right or privileges as a shareholder unless and until
certificates for shares of Common Stock are issued to
him or her.
(h) Leaves of Absence and Disability. The Board shall be
entitled to make such rules, regulations and
determinations as it deems appropriate under the Plan
in respect of any leave of absence taken by or
disability of any key employee. Without limiting the
generality of the foregoing, the Board shall be
entitled to determine (i) whether or not any such
leaves of absence shall constitute a termination of
employment within the meaning of the Plan, and (ii)
the impact, if any, of 'any such leave of absence on
awards under the Plan theretofore made to any key
employee who takes such leave of absence.
(i) Fair Market Value. Whenever the fair market value of
Common Stock is to be determined under the Plan as of
a given date, such fair market value shall be:
(i) If the Common Stock is traded on the over
the-counter market, the average of the mean
between the bid and the asked price f or the
Common Stock at the close of trading for the
ten (10) consecutive trading days immediately
preceding such given date;
(ii) If the Common Stock is listed on a national
securities exchange, the average of the
closing prices of the Common Stock on the
Composite Tape for the ten (10) consecutive
trading days immediately preceding such given
date; and
(iii) If the Common Stock is neither traded on the
over-the-counter market nor listed on a
national securities exchange, such value as
the Board, in good faith, shall determine.
(j) Notices. Every direction, revocation or notice authorized or
required by the Plan shall be deemed delivered to the Company
(a) on the date it is personally delivered to the Secretary of
the Company at its principal executive offices or (b) three
business days after it is sent by registered or
<PAGE> 13
certified mail, postage prepaid, addressed to the
Secretary at such offices; and shall be deemed
delivered to an optionee (a) on the date it is
personally delivered to him or her or (b) three
business days after it is sent by registered or
certified mail, postage prepaid, addressed to him or
her at the last address shown for him or her on the
records of the Company.
(k) Applicable Law. All questions pertaining to the
validity, construction and administration of the Plan
and Stock Options and Stock Appreciation Rights
granted hereunder shall be determined in conformity
with the laws of the State of Texas.
(l) Elimination of Fractional Shares. If under any
provision of the Plan which requires a computation of
the number of shares of Common Stock subject to a
Stock Option or Stock Appreciation Right, the number
so computed is not a whole number of shares of Common
Stock, such number of shares of Common Stock shall be
rounded down to the next whole number.
(m) Shareholders' Agreement. Notwithstanding anything to
the contrary contained in the Plan, the Company shall
be under no obligation to sell or deliver Common
Stock under the Plan to an optionee unless such
optionee shall execute the Shareholders' Agreement
dated effective in December 31, 1990 with respect to
such Common Stock, a copy of which will be furnished
Optionee reasonably prior to any exercise.
This Plan, in accordance with Section 10, is effective as of the
approval of shareholders evidenced in the Preamble hereof.
CHAMPION HEALTHCARE CORPORATION
By:
---------------------------------
Its:
-------------------------
<PAGE> 14
AMENDMENT NO. 1 TO CHAMPION HEALTHCARE CORPORATION
EMPLOYEE STOCK OPTION PLAN
This Amendment No. 1 to the Champion Healthcare Corporation Employee Stock
Option Plan is effective this 6th day of December, 1994 upon the execution
hereof by Champion Healthcare Corporation and the holders of options on the
date hereof whose signatures appear below.
PREAMBLE. Pursuant to authority granted by the Board of Directors of
Champion Healthcare Corporation on August 9, 1994, the hereinbelow described
amendment (the "Amendment") was adopted to the Employee Stock Option Plan (the
"Plan"). This Amendment was approved by the shareholders on December 6, 1994,
with an effective date for all purposes as of the date set forth in the first
paragraph above.
AMENDMENT. Section 9 of the Plan is hereby amended so that Stock Options
and Stock Appreciation Rights will not expire upon the merger or consolidation
of the Company, and Section 9 is amended to read in its entirety as follows:
9. DISSOLUTION, MERGER AND CONSOLIDATION.
Except as otherwise provided in Section 6(c)(ii), upon the
dissolution or liquidation of the Company or upon a merger or
consolidation of the Company in which the Company is not the surviving
corporation and for which the plan or agreement of merger or
consolidation does not provide for assumption by the surviving or
consolidated corporation of Stock Options and/or Stock Appreciation
Rights granted hereunder, each Stock Option and Stock Appreciation
Right granted hereunder shall expire as of the effective date of such
dissolution or liquidation; provided, however, that the Board shall
give at least 30 days prior written notice of such event to each
optionee during which time he or she shall have a right to exercise
his or her (1) vested or (2) if specifically provided in the option
grant, vested and unvested, wholly or partially unexercised Stock
Option (without regard to installment exercise limitations, if any) or
Stock Appreciation Right and, subject to prior expiration pursuant to
Section 11(b) or (c), each Stock Option and Stock Appreciation Right
shall be exercisable after receipt of such written notice and prior to
the effective date of such transaction. Any term or provision in this
Plan to the contrary notwithstanding, in the event of a merger or
consolidation of the Company in which the Company is not the surviving
corporation and for which the plan or agreement of merger or
consolidation does provide for assumption by the surviving or
consolidated corporation of Stock Options or Stock Appreciation Rights
granted hereunder, each Stock Option and Stock Appreciation Right
granted hereunder shall survive such merger or consolidation, and
shall become and remain an obligation of the surviving corporation,
and shall be adjusted according to the adjustment provisions of
Section 8 of the Plan.
AGREEMENT OF EXISTING OPTION HOLDERS. The undersigned individual, a holder
<PAGE> 15
of an option issued pursuant to the Plan, hereby consents and agrees to the
Amendment.
COUNTERPARTS. This Amendment may be executed in one or more counterparts,
each of which shall be considered an original and together shall constitute the
one and same document.
CHAMPION HEALTHCARE CORPORATION
By:
-------------------------------
James G. VanDevender,
Executive Vice-president
OPTION HOLDER
-------------------------------
Print Name:
--------------------
<PAGE> 1
EXHIBIT - 4.7
CHAMPION HEALTHCARE CORPORATION
EMPLOYEE STOCK OPTION PLAN NO. 2
Preamble. The Board of Directors of Champion Healthcare Corporation adopted
the hereinbelow described Employee Stock Option Plan No. 2 effective as of May
27, 1992 and it was approved by the shareholders with an effective date for all
purposes of May 27, 1992.
1. Purpose
The purpose of this Employee Stock Option Plan No. 2 (the "Plan") is
to give officers and executive personnel ("key employees") of Champion
Healthcare Corporation, a corporation (the "Company"), and corporations with
respect to which the Company directly or indirectly controls 50% or more of the
combined voting power ("subsidiaries"), an opportunity to acquire shares of the
common stock of the Company, no par value ("Common Stock"), to provide an
incentive for key employees to continue to promote the best interests of the
Company and enhance its long-term performance, and to provide an incentive for
key employees to join or remain with the Company and its subsidiaries.
2. Administration.
(a) Board of Directors. The Plan shall be administered by the
Board of Directors of the Company (the "Board"), which, to the
extent it shall determine, may delegate its powers with
respect to the administration of the Plan (except its powers
under Section 12(c)) to a committee of directors (the
"Committee") appointed by the Board and composed of not less
than two members of the Board. If the Board chooses to appoint
a Committee, references hereinafter to the Board (except in
Section 12(c)) shall be deemed to refer to the Committee.
Notwithstanding the preceding provisions of this Section, no
member of the Board may exercise discretion with respect to,
or participate in, the administration of the Plan if, at any
time within one year prior to such exercise or participation,
he or she has received stock, stock options, stock
appreciation rights or any other derivative security pursuant
to the Plan or any other plan of the Company or any affiliate
thereof as to which any discretion is exercised.
(b) Powers. Within the limits of the express provisions of the
Plan, the Board shall determine: (i) the key employees to whom
awards hereunder shall be granted, (ii) the time or times at
which such awards shall be granted, (iii) the form and amount,
-1-
<PAGE> 2
of the awards, and (iv) the limitations, restrictions and
conditions applicable to any such award. In making such
determinations, the Board may take into account the nature of
the services rendered by such employees, or classes of
employees, their present and potential contributions to the
Company's success and such other factors as the Board in its
discretion shall deem relevant.
(c) Interpretations. Subject to the express provisions of the
Plan, the Board may interpret the Plan, prescribe, amend and
rescind rules and regulations relating to it, determine the
terms and provisions of the respective awards and make all
other determinations it deems necessary or advisable for the
administration of the Plan.
(d) Determinations. The determinations of the Board on all matters
regarding the Plan shall be conclusive. A member of the Board
shall only be liable for any action taken or determination
made in bad faith.
(e) Nonuniform Determinations. The Board's determinations under
the Plan, including without limitation, determinations as to
the persons to receive awards, the terms and provisions of
such awards and the agreements evidencing the same, need not
be uniform and may be made by it selectively among persons who
receive or are eligible to receive awards under the Plan,
whether or not such persons are similarly situated.
3. Awards Under the Plan.
(a) Type of Award. Awards under the Plan may be granted in any either
or both of the following forms: (i) Nonstatutory Stock Options, as
described in Section 4, and (ii) Stock Appreciation Rights, as
described in Section 6. Nonstatutory Stock options shall be referred
to herein as "Stock Options."
(b) Maximum Limitations. The aggregate number of shares of Common
Stock available for grant under the Plan is 150,000, subject to
adjustment pursuant to Section 8. Shares of Common Stock issued
pursuant to the Plan may be either authorized but unissued shares or
shares now or hereafter held in the treasury of the Company. In the
event that, prior to the end of the period during which Stock Options
may be granted under the Plan, any Stock Option under the Plan expires
unexercised or is terminated, surrendered or canceled (other than in
connection with the exercise of a Stock Appreciation Right) without
being exercised, in whole or in part, for
-2-
<PAGE> 3
any reason, the number of shares theretofore subject to such
Stock Option or the unexercised, terminated, forfeited or
unearned portion thereof, shall be added to the remaining
number of shares of Common Stock available for grant as a
Stock Option under the Plan, including a grant to a former
holder of such Stock Option, upon such terms and conditions as
the Board shall determine, which terms may be more or less
favorable than those applicable to such former Stock Option.
4. Stock Options.
(a) Conditions. Stock Options may be granted under the Plan for
the purchase of shares of Common Stock. Stock Options shall be
in such form and upon such terms and conditions as the Board
shall from time to time determine, subject to the following.
(i) Option Price. The option price of each Stock
Option to purchase Common Stock shall be
determined by the Board, but shall not be
less than 80% of the fair market value of the
Common Stock subject to such Stock Option on
the date of grant.
(ii) Term of Options. No Stock Option shall be
exercisable after the date ten (10) years and
one (1) day from the date such Stock Option
is granted.
(iii) Conditions of Grant. The Board, in its
discretion, may, as a condition to the grant
of a Stock Option, require a key employee who
is the recipient of such Stock Option to
enter into one or more of the following
agreements with the Company on or prior to
the date of grant of such Option:
a) A covenant not to compete with the
Company and its subsidiaries which
shall become effective on the date
of termination of employment of the
key employee with the Company and
which shall contain such terms and
conditions as shall be specified by
the Board;
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<PAGE> 4
(b) An agreement to cancel any
employment agreement, fringe
benefit or compensation
arrangement in effect between
the Company and the key
employee.
(c) The Shareholders' Agreement
dated effective December 31,
1990 among the Company and
Company Shareholders set forth
in Schedule I to that agreement.
If the key employee shall fail to enter into any such agreement at the request
of the Board, then no Stock Option shall be granted hereunder to such key
employee and the number of shares of Common Stock which would have been subject
to such Option shall be added to the remaining number of shares of Common Stock
available for grant as a Stock Option under the Plan.
(b) Form. The form of the stock option agreement shall subject to
paragraph (a) immediately above, be substantially in the form
as Exhibit 1 hereto.
5. Provisions Applicable to Stock Options.
(a) Exercise. Stock Options shall be subject to such terms and
conditions, shall be exercisable at such time or times, and
shall be evidenced by such form of written option agreement
between the optionee and the Company, as the Board shall
determine; provided, that such determinations are not
inconsistent with the other provisions of the Plan.
(b) Manner of Exercise of Options and Payment for Common Stock.
Stock Options may be exercised by an optionee by giving
written notice to the Secretary of the Company stating the
number of shares of Common Stock with respect to which the
Stock Option is being exercised and tendering payment
therefor. At the time that a Stock Option granted under the
Plan, or any part thereof, is exercised, payment for the
Common Stock issuable thereupon shall be made in full in cash
or by certified check or, if the Board in its discretion
agrees to accept, in shares of Common Stock of the Company
(the number of such shares paid for each share subject to the
Stock Option, or part thereof, being exercised shall be
determined by dividing the option price by the fair market
value per share of the Common Stock on the date of exercise).
As soon as reasonably possible following such exercise, a
certificate representing shares of Common Stock purchased,
registered in the name of the optionee, shall be delivered to
the optionee.
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<PAGE> 5
(c) Cancellation of Stock Appreciation Rights. The
exercise of any Stock Option shall cancel that
number, if any, of Stock Appreciation Rights (as
defined in Section 6) included in such Stock Option,
which is equal to the excess of (i) the number of
shares of Common Stock subject to Stock Appreciation
Rights included in such Stock Option, over (ii) the
number of shares of Common Stock which remain subject
to such Stock Option after such exercise.
6. Stock Appreciation Rights.
(a) Award. If deemed by the Board to be in the best
interest of the Company, any Stock Option granted
under the Plan may include a stock appreciation right
("Stock Appreciation Right"), either at the time of
grant or thereafter while the Stock Option is
outstanding.
(b) Terms of Rights. Stock Appreciation Rights shall be
subject to such terms and conditions not inconsistent
with the other provisions of the Plan as the Board
shall determine; provided that:
(i) Limitations. A Stock Appreciation Right shall be
exercisable to the extent, and only to the extent,
the Stock Option in which it is included is
exercisable and shall be exercisable only for such
period as the Board may determine (which period may
expire prior to the expiration date of such Stock
Option).
(ii) Surrender or Exchange. A Stock Appreciation
Right shall entitle the optionee to surrender to the
Company unexercised the Stock Option, or portion
thereof, to which it is related, or any portion
thereof, and to receive from the Company in exchange
therefor that number of shares of Common Stock having
an aggregate fair market value equal to the excess of
the fair market value on the date of exercise of one
share of Common Stock over the option price per share
specified in such Stock Option, multiplied by the
number of shares of Common Stock subject to the Stock
Option, or portion thereof, which is so surrendered.
The Board shall be entitled to elect to settle any
part or all of the Company's obligation arising out
of the exercise of a Stock Appreciation Right by the
payment to the optionee of cash or by check equal to
the aggregate fair market value on the date on which
the Stock Appreciation Right is exercised of that
part or all of the shares of Common Stock the Company
would otherwise be obligated to deliver.
(c) Cash Settlement Restrictions.
(i) Notwithstanding Sections 6(b) and 9 hereof,
so long as the grantee of a Stock
Appreciation-Right is an officer, an owner
of 10% or more of an equity security of the
Company
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<PAGE> 6
that is registered under the Securities
Exchange Act of 1934, or a director of the
Company, the Company's right to elect to
settle any part or all of its obligation
arising out of the exercise of a Stock
Appreciation Right by the payment of cash
or by check shall not apply unless such
exercise occurs either: (1) pursuant to the
provisions of subsection (ii) below, or (2)
during the period beginning on the third
business day following the date of release
by the Company for publication of its
quarterly or annual summary statements of
sales and earnings and ending on the twelfth
business day following such date.
(ii) In the event that, pursuant to Section 9,
the Company shall cancel all unexercised
Stock Options as of the effective date of
a merger or other transaction provided
therein or in the case of dissolution of the
Company, then each Stock Appreciation Right
held by an officer, an owner of 10% or more
of an equity security of the Company that
is registered under the Securities Exchange
Act of 1934, or a director of the Company,
shall be automatically exercised on such
date within 30 days prior to the effective
date of such transaction or dissolution as
the Board shall determine and, in the
absence of such determination, on the last
business day immediately prior to such
effective date.
7. Transferability.
No Stock option or Stock Appreciation Right may be transferred,
assigned, pledged or hypothecated (whether by operation of law or otherwise),
except as provided by will or the applicable laws of descent or distribution,
and no Stock option or Stock Appreciation Right shall be subject to execution,
attachment or similar process. Any attempted assignment, transfer, pledge,
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<PAGE> 7
hypothecation or other disposition of a Stock Option or Stock Appreciation
Right, or levy of attachment or similar process upon the Stock Option or Stock
Appreciation Right not specifically permitted herein shall be null and void and
without effect. A Stock Option or Stock Appreciation Right may be exercised
only by a key employee during his or her lifetime, or pursuant to Section 11
(c), by his or her estate or the person who acquires the right to exercise such
Stock Option or Stock Appreciation Right upon his or her death by bequest or
inheritance.
8. Adjustment Provisions.
The aggregate number of shares of Common Stock with respect to which
Stock Options and Stock Appreciation Rights may be granted, the aggregate
number of shares of Common Stock subject to each outstanding Stock Option and
Stock Appreciation Right, and the option price per share of each such Stock
Option, may all be appropriately adjusted as the Board may determine for any
increase or decrease in the number of shares of issued Common Stock resulting
from a subdivision or consolidation of shares, whether through reorganization,
recapitalization, stock split-up, stock distribution or combination of shares,
or the payment of a share dividend or other increase or decrease in the number
of such shares outstanding effected without receipt of consideration by the
Company. Adjustments under this Section 8 shall be made according to the sole
discretion of the Board, and its decisions shall be binding and conclusive.
9. Dissolution, Merger and Consolidation.
Except as otherwise provided in Section 6(c)(ii), upon the dissolution
or liquidation of the Company, or upon a merger or consolidation of the Company
in which the Company is not the surviving corporation, each Stock Option and
Stock Appreciation Right granted hereunder shall expire as of the effective
date of such transaction; provided, however, that the Board shall give at least
30 days prior written notice of such event to each optionee during which time
he or she shall have a right to exercise his or her (1) vested or (2) if
specifically provided in the option grant, vested and unvested, wholly or
partially unexercised Stock Option (without regard to installment exercise
limitations, if any) or Stock Appreciation Right and, subject to prior
expiration pursuant to Section 11(b) or (c), each Stock Option and Stock
Appreciation Right shall be exercisable after receipt of such written notice
and prior to the effective date of such transaction.
10. Effective Date and Conditions Subsequent to Effective Date.
The Plan shall become effective on the date of the approval of the
Plan by the holders of a majority of the shares of Common Stock of the Company,
and the Plan shall be null and void and of no effect if such condition is not
fulfilled, and in such event each Stock Option or Stock Appreciation Right
granted hereunder shall, notwithstanding any of the preceding provisions of the
Plan,
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<PAGE> 8
be null and void and of no effect. No grant or award shall be made under the
Plan more than ten (10) years from the date of shareholder approval hereof;
provided, however, that the Plan and all Stock Options and Stock Appreciation
Rights granted under the Plan prior to such date shall remain in effect and
subject to adjustment and amendment as herein provided until they have been
satisfied or terminated in accordance with the terms of the respective grants
or awards and the related agreements.
11. Termination of Employment.
(a) Each Stock Option and Stock Appreciation Right shall,
unless sooner expired pursuant to Section 11 (b) or
(c) below, expire on the first to occur of the date
one day after the tenth anniversary of the date of
grant thereof or the expiration date set forth in the
applicable option agreement.
(b) A Stock Option and Stock Appreciation Right shall
expire on the first to occur of the applicable date
set forth in paragraph (a) next above and the date
that the employment of the key employee with the
Company and all subsidiaries terminates for any
reason other than death or disability. Upon receipt
of notice of termination of employment, whether
written or oral, Optionee shall not thereafter have
the right to exercise the Stock Option or Stock
Appreciation Rights. Notwithstanding the preceding
provisions of this paragraph, the Board, in its sole
discretion, may, by written notice given to a former
employee, permit the former employee to exercise
Stock Options or Stock Appreciation Rights during a
period following his or her termination of
employment, which period shall not exceed ninety (90)
days. In no event, however, may the Board permit a
former employee to exercise a Stock Option or Stock
Appreciation Right after the expiration date
contained in the agreement evidencing such Stock
Option or Stock Appreciation Right. Notwithstanding
the preceding provisions of this paragraph, if the
Board permits a former employee to exercise Stock
Options or Stock Appreciation Rights during a period
following his or her termination of employment
pursuant to such preceding provisions, such Stock
Options or Stock Appreciation Rights shall, to the
extent unexercised, expire on the date that such
former employee violates (as determined by the Board)
any covenant not to compete in effect between the
Company and/or its subsidiaries and the former
employee.
(c) If the employment of a key employee with the Company
and all subsidiaries terminates by reason of
disability (as determined by the Board) or by reason
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<PAGE> 9
of death, his or her Stock Options and Stock
Appreciation Rights, if any, shall expire on the
first to occur of the date set forth in paragraph (a)
of this Section 11 and the first anniversary of such
termination of employment.
12. Miscellaneous.
(a) Legal and Other Requirements. The obligation of the
Company to sell and deliver Common Stock under the
Plan shall be subject to all applicable laws,
regulations, rules and approvals, including, but not
by way of limitation, the effectiveness of a
registration statement under the Securities Act of
1933 if deemed necessary or appropriate by the
Company. Certificates for shares of Common Stock
issued hereunder may be legend as the Board shall
deem appropriate.
(b) No Obligation to Exercise Options. The granting of a
Stock Option shall impose no obligation upon an
optionee to exercise such Stock option.
(c) Termination and Amendment of Plan. The Board, without
further action on the part of the shareholders of the
Company, may from time to time alter, amend or
suspend the Plan or any Stock Option or Stock
Appreciation Right granted hereunder or may at any
time terminate the Plan, except that, unless approved
by the shareholders in accordance with Section 10
hereof, it may not (except to the extent provided in
Section 8 hereof): (i) change the total number of
shares of Common Stock available for grant under the
Plan; (ii) extend the duration of the Plan; (iii)
increase the maximum term of Stock Options; or (iv)
change the class of employees eligible to be granted
Stock Options or Stock Appreciation Rights under the
Plan. No action taken by the Board under this Section
may materially and adversely affect any outstanding
Stock Option or Stock Appreciation Right without the
consent of the holder thereof.
(d) Application of Funds. The proceeds received by the
Company from the sale of Common Stock pursuant to
Stock Options will be used for general corporate
purposes.
(e) Withholding Taxes. Upon the exercise of aany Stock
Option or Stock Appreciation Right, the Company shall
have the right to require the optionee to remit to
the Company an amount sufficient to satisfy an
federal, state and local withholding tax requirements
prior to the delivery of any certificate
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<PAGE> 10
or certificates for shares of Common Stock. Whenever
under the Plan payments are to be made by the Company
in cash or by check, such payments shall be net of
any amounts sufficient to satisfy all federal, state
and local withholding tax requirements.
(f) Right to Terminate Employment. Nothing in the Plan
or any agreement entered into pursuant to the Plan
shall confer upon any key employee or other optionee
the right to continue in the employment of the
Company or any subsidiary or affect any right which
the Company or any subsidiary may have to terminate
the employment of such key employee or other
optionee.
(g) Rights as a Shareholder. No optionee shall have any
right or privileges as a shareholder unless and until
certificates for shares of Common Stock are issued to
him or her.
(h) Leaves of Absence and Disability. The Board shall be
entitled to make such rules, regulations and
determinations as it deems appropriate under the Plan
in respect of any leave of absence taken by or
disability of any key employee. Without limiting the
generality of the foregoing, the Board shall be
entitled to determine (i) whether or not any such
leaves of absence shall constitute a termination of
employment within the meaning of the Plan, and (ii)
the impact, if any, of any such leave of absence on
awards under the Plan theretofore made to any key
employee who takes such leave of absence.
(i) Fair Market Value. Whenever the fair market value of
Common Stock is to be determined under the Plan as of
a given date, such fair market value shall be:
(i) If the Common Stock is traded on the
over the-counter market, the average
of the mean between the bid and the
asked price for the Common Stock at
the close of trading for the ten
(10) consecutive trading days
immediately preceding such given
date;
(ii) If the Common Stock is listed on a
national securities exchange, the
average of the closing prices of the
Common Stock on the Composite Tape
for the ten (10) consecutive trading
days immediately preceding such
given date; and
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<PAGE> 11
(iii) If the Common Stock is neither traded on the
over-the-counter market nor listed on a
national securities exchange, such value as
the Board, in good faith, shall determine.
(j) Notices. Every direction, revocation or notice
authorized or required by the Plan shall be deemed
delivered to the Company (a) on the date it is
personally delivered to the Secretary of the Company
at its principal executive offices or (b) three
business days after it is sent by registered or
certified mail, postage prepaid, addressed to the
Secretary at such offices; and shall be deemed
delivered to an optionee (a) on the date it is
personally delivered to him or her or (b) three
business days after it is sent by registered or
certified mail, postage prepaid, addressed to him or
her at the last address shown for him or her on the
records of the Company.
(k) Applicable Law. All questions pertaining to the
validity, construction and administration of the Plan
and Stock Options and Stock Appreciation Rights
granted hereunder shall be determined in conformity
with the laws of the State of Texas.
(1) Elimination of Fractional Shares. If under any
provision of the Plan which requires a computation
of the number of shares of Common Stock subject to a
Stock Option or Stock Appreciation Right, the number
so computed is not a whole number of shares of Common
Stock, such number of shares of Common Stock shall be
rounded down to the next whole number.
(m) Shareholders' Agreement. Notwithstanding anything to
the contrary contained in the Plan, the Company shall
be under no obligation to sell or deliver Common
Stock under the Plan to an optionee unless such
optionee shall execute the Shareholders, Agreement
dated effective in December 31, 1990 with respect to
such Common Stock, a copy of which will be furnished
Optionee reasonably prior to any exercise.
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<PAGE> 12
This Plan, in accordance with Section 10, is effective as of the
approval of shareholders evidenced in the Preamble hereof.
CHAMPION HEALTHCARE CORPORATION
By:
Its:
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<PAGE> 13
AMENDMENT NO. 1 TO CHAMPION HEALTHCARE CORPORATION
EMPLOYEE STOCK OPTION PLAN NO. 2
This Amendment No. 1 to the Champion Healthcare Corporation Employee Stock
Option Plan No. 2 is effective this 6th day of December, 1994, upon the
execution hereof by Champion Healthcare Corporation and the holders of options
on the date hereof whose signatures appear below.
PREAMBLE. Pursuant the authority granted by the Board of Directors of
Champion Healthcare Corporation on August 9, 1994, the hereinbelow described
amendment (the "Amendment") was adopted to the Employee Stock Option Plan No. 2
(the "Plan"). This Amendment was approved by the shareholders on December 6,
1994, with an effective date for all purposes as of the date set forth in the
first paragraph above.
AMENDMENT. Section 9 of the Plan is hereby amended so that Stock Options
and Stock Appreciation Rights will not expire upon the merger or consolidation
of the Company, and Section 9 is amended to read in its entirety as follows:
9. DISSOLUTION, MERGER AND CONSOLIDATION.
Except as otherwise provided in Section 6(c)(ii), upon the
dissolution or liquidation of the Company or upon a merger or
consolidation of the Company in which the Company is not the surviving
corporation and for which the plan or agreement of merger or
consolidation does not provide for assumption by the surviving or
consolidated corporation of Stock Options and/or Stock Appreciation
Rights granted hereunder, each Stock Option and Stock Appreciation
Right granted hereunder shall expire as of the effective date of such
dissolution or liquidation; provided, however, that the Board shall
give at least 30 days prior written notice of such event to each
optionee during which time he or she shall have a right to exercise
his or her (1) vested or (2) if specifically provided in the option
grant, vested and unvested, wholly or partially unexercised Stock
Option (without regard to installment exercise limitations, if any) or
Stock Appreciation Right and, subject to prior expiration pursuant to
Section 11(b) or (c), each Stock Option and Stock Appreciation Right
shall be exercisable after receipt of such written notice and prior to
the effective date of such transaction. Any term or provision in this
Plan to the contrary notwithstanding, in the event of a merger or
consolidation of the Company in which the Company is not the surviving
corporation and for which the plan or agreement of merger or
consolidation does provide for assumption by the surviving or
consolidated corporation of Stock Options or Stock Appreciation Rights
granted hereunder, each Stock Option and Stock Appreciation Right
granted hereunder shall survive such merger or consolidation, and
shall become and remain an obligation of the surviving corporation,
and shall be adjusted according to the adjustment
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<PAGE> 14
provisions of Section 8 of the Plan.
AGREEMENT OF EXISTING OPTION HOLDERS. The undersigned individual, a holder
of an option issued pursuant to the Plan, hereby consents and agrees to the
Amendment.
COUNTERPARTS. This Amendment may be executed in one or more counterparts,
each of which shall be considered an original and together shall constitute the
one and same document.
CHAMPION HEALTHCARE CORPORATION
By:
--------------------------------
James G. VanDevender,
Executive Vice-president
OPTION HOLDER
--------------------------------
Print Name:
---------------------
OPTION HOLDER
--------------------------------
Print Name:
---------------------
OPTION HOLDER
--------------------------------
Print Name:
---------------------
OPTION HOLDER
--------------------------------
Print Name:
---------------------
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<PAGE> 1
EXHIBIT 4.8
CHAMPION HEALTHCARE CORPORATION
EMPLOYEE STOCK OPTION PLAN NO. 3
PREAMBLE. The Board of Directors of Champion Healthcare Corporation adopted
the hereinbelow described Employee Stock Option Plan No. 3 effective as of
__________, 1992 and it was approved by the shareholders with an effective date
for all purposes of ________, 1992.
1. PURPOSE
The purpose of this Employee Stock Option Plan No. 3 (the "Plan")
is to give officers and executive personnel ("key employees") of Champion
Healthcare Corporation, a corporation (the "Company"), and corporations with
respect to which the Company directly or indirectly controls 50% or more of the
combined voting power ("subsidiaries"), an opportunity to acquire shares of the
common stock of the Company, no par value ("Common Stock"), to provide an
incentive for key employees to continue to promote the best interests of the
Company and enhance its long-term performance, and to provide an incentive for
key employees to join or remain with the Company and its subsidiaries.
2. ADMINISTRATION.
(a) BOARD OF DIRECTORS. The Plan shall be administered
by the Board of Directors of the Company (the
"Board"), which, to the extent it shall determine,
may delegate its powers with respect to the
administration of the Plan (except its powers under
Section 12(c)) to a committee of directors (the
"Committee") appointed by the Board and composed of
not less than two members of the Board. If the Board
chooses to appoint a Committee, references
hereinafter to the Board (except in Section 12(c))
shall be deemed to refer to the Committee.
Notwithstanding the preceding provisions of this
Section, no member of the Board may exercise
discretion with respect to, or participate in, the
administration of the Plan if, at any time within one
year prior to such exercise or participation, he or
she has received stock, stock options, stock
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<PAGE> 2
appreciation rights or any other derivative security
pursuant to the Plan or any other plan of the Company
or any affiliate thereof as to which any discretion
is exercised.
(b) POWERS. Within the limits of the express provisions
of the Plan, the Board shall determine: (i) the key
employees to whom awards hereunder shall be granted,
(ii) the time or times at which such awards shall be
granted, (iii) the form and amount of the awards, and
(iv) the limitations, restrictions and conditions
applicable to any such award. In making such
determinations, the Board may take into account the
nature of the services rendered by such employees, or
classes of employees, their present and potential
contributions to the Company's success and such other
factors as the Board in its discretion shall deem
relevant.
(c) INTERPRETATIONS. Subject to the express provisions
of the Plan, the Board may interpret the Plan,
prescribe, amend and rescind rules and regulations
relating to it, determine the terms and provisions of
the respective awards and make all other
determinations it deems necessary or advisable for
the administration of the Plan.
(d) DETERMINATIONS. The determinations of the Board on
all matters regarding the Plan shall be conclusive. A
member of the Board shall only be liable for any
action taken or determination made in bad faith.
(e) NONUNIFORM DETERMINATIONS. The Board's
determinations under the Plan, including without
limitation, determinations as to the persons to
receive awards, the terms and provisions of such
awards and the agreements evidencing the same, need
not be uniform and may be made by it selectively
among persons who receive or are eligible to receive
awards under the Plan, whether or not such persons
are similarly situated.
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<PAGE> 3
3. AWARDS UNDER THE PLAN.
(a) TYPE OF AWARD. Awards under the Plan may be granted
in any either or both of the following forms: (i)
Nonstatutory Stock Options, as described in Section
4, and (ii) Stock Appreciation Rights, as described
in Section 6. Nonstatutory Stock Options shall be
referred to herein as "Stock Options."
(b) MAXIMUM LIMITATIONS. The aggregate number of shares
of Common Stock available for grant under the Plan is
100,000, subject to adjustment pursuant to Section 8.
Shares of Common Stock issued pursuant to the Plan
may be either authorized but unissued shares or
shares now or hereafter held in the treasury of the
Company. In the event that, prior to the end of the
period during which Stock Options may be granted
under the Plan, any Stock Option under the Plan
expires unexercised or is terminated, surrendered or
cancelled (other than in connection with the exercise
of a Stock Appreciation Right) without being
exercised, in whole or in part, for any reason, the
number of shares theretofore subject to such Stock
Option or the unexercised, terminated, forfeited or
unearned portion thereof, shall be added to the
remaining number of shares of Common Stock available
for grant as a Stock Option under the Plan, including
a grant to a former holder of such Stock Option, upon
such terms and conditions as the Board shall
determine, which terms may be more or less favorable
than those applicable to such former Stock Option.
4. STOCK OPTIONS.
(a) CONDITIONS. Stock Options may be granted under the
Plan for the purchase of shares of Common Stock.
Stock Options shall be in such form and upon such
terms and conditions as the Board shall from time to
time determine, subject to the following.
(i) OPTION PRICE. The option price of each
Stock Option to purchase Common Stock
shall
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<PAGE> 4
be determined by the Board, but shall
not be less than 80% of the fair market
value of the Common Stock subject to
such Stock Option on the date of grant
or $11.50, whichever is greater.
(ii) TERM OF OPTIONS. No Stock Option shall
be exercisable after the date ten (10)
years and one (1) day from the date such
Stock Option is granted.
(iii) CONDITIONS OF GRANT. The Board, in its
discretion, may, as a condition to the
grant of a Stock Option, require a key
employee who is the recipient of such
Stock Option to enter into one or more
of the following agreements with the
Company on or prior to the date of grant
of such Option:
a) A covenant not to compete with
the Company and its
subsidiaries which shall
become effective on the date
of termination of employment
of the key employee with the
Company and which shall
contain such terms and
conditions as shall be
specified by the Board;
b) An agreement to cancel any
employment agreement, fringe
benefit or compensation
arrangement in effect between
the Company and the key
employee.
c) The Shareholders' Agreement
dated effective December 31,
1990 among the Company and
Company Shareholders set forth
in Schedule I to that
agreement.
d) The Selected Shareholders'
Agreement dated May 27, 1992
among the Company and the
Shareholders listed therein.
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<PAGE> 5
e) The Stockholders Agreement
dated May 27, 1992 among the
Company and the Stockholders
listed therein.
If the key employee shall fail to enter into any such agreement at the request
of the Board, then no Stock Option shall be granted hereunder to such key
employee and the number of shares of Common Stock which would have been subject
to such Option shall be added to the remaining number of shares of Common Stock
available for grant as a Stock Option under the Plan.
(b) FORM. The form of the stock option agreement shall
subject to paragraph (a) immediately above, be
substantially in the form as Exhibit 1 hereto.
5. PROVISIONS APPLICABLE TO STOCK OPTIONS.
(a) EXERCISE. Stock Options shall be subject to such
terms and conditions, shall be exercisable at such
time or times, and shall be evidenced by such form of
written option agreement between the optionee and the
Company, as the Board shall determine; provided, that
such determinations are not inconsistent with the
other provisions of the Plan.
(b) MANNER OF EXERCISE OF OPTIONS AND PAYMENT FOR COMMON
STOCK. Stock Options may be exercised by an optionee
by giving written notice to the Secretary of the
Company stating the number of shares of Common Stock
with respect to which the Stock Option is being
exercised and tendering payment therefor. At the time
that a Stock Option granted under the Plan, or any
part thereof, is exercised, payment for the Common
Stock issuable thereupon shall be made in full in
cash or by certified check or, if the Board in its
discretion agrees to accept, in shares of Common
Stock of the Company (the number of such shares paid
for each share subject to the Stock Option, or part
thereof, being exercised shall be determined by
dividing the option price by the fair market value
per share of the Common Stock on the date of
exercise). As soon as reasonably possible following
such exercise, a certificate representing shares of
Common Stock purchased,
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<PAGE> 6
registered in the name of the optionee, shall be
delivered to the optionee.
(c) CANCELLATION OF STOCK APPRECIATION RIGHTS. The
exercise of any Stock Option shall cancel that
number, if any, of Stock Appreciation Rights (as
defined in Section 6) included in such Stock Option,
which is equal to the excess of (i) the number of
shares of Common Stock subject to Stock Appreciation
Rights included in such Stock Option, over (ii) the
number of shares of Common Stock which remain subject
to such Stock Option after such exercise.
6. STOCK APPRECIATION RIGHTS.
(a) AWARD. If deemed by the Board to be in the best
interest of the Company, any Stock Option granted
under the Plan may include a stock appreciation right
("Stock Appreciation Right"), either at the time of
grant or thereafter while the Stock Option is
outstanding.
(b) TERMS OF RIGHTS. Stock Appreciation Rights shall be
subject to such terms and conditions not inconsistent
with the other provisions of the Plan as the Board
shall determine; provided that:
(i) LIMITATIONS. A Stock Appreciation Right
shall be exercisable to the extent, and
only to the extent, the Stock Option in
which it is included is exercisable and
shall be exercisable only for such
period as the Board may determine (which
period may expire prior to the
expiration date of such Stock Option).
(ii) SURRENDER OR EXCHANGE. A Stock
Appreciation Right shall entitle the
optionee to surrender to the Company
unexercised the Stock Option, or portion
thereof, to which it is related, or any
portion thereof, and to receive from the
Company in exchange therefor that number
of shares of Common Stock having an
aggregate fair market value
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equal to the excess of the fair market
value on the date of exercise of one
share of Common Stock over the option
price per share specified in such Stock
Option, multiplied by the number of
shares of Common Stock subject to the
Stock Option, or portion thereof, which
is so surrendered. The Board shall be
entitled to elect to settle any part or
all of the Company's obligation arising
out of the exercise of a Stock
Appreciation Right by the payment to the
optionee of cash or by check equal to
the aggregate fair market value on the
date on which the Stock Appreciation
Right is exercised of that part or all
of the shares of Common Stock the
Company would otherwise be obligated to
deliver.
(c) CASH SETTLEMENT RESTRICTIONS.
(i) Notwithstanding Sections 6(b) and 9
hereof, so long as the grantee of a
Stock Appreciation Right is an officer,
an owner of 10% or more of an equity
security of the Company that is
registered under the Securities Exchange
Act of 1934, or a director of the
Company, the Company's right to elect to
settle any part or all of its obligation
arising out of the exercise of a Stock
Appreciation Right by the payment of
cash or by check shall not apply unless
such exercise occurs either: (1)
pursuant to the provisions of subsection
(ii) below, or (2) during the period
beginning on the third business day
following the date of release by the
Company for publication of its quarterly
or annual summary statements of sales
and earnings and ending on the twelfth
business day following such date.
(ii) In the event that, pursuant to Section
9, the Company shall cancel all
unexercised Stock Options as of the
effective date of a
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<PAGE> 8
merger or other transaction provided
therein or in the case of dissolution of
the Company, then each Stock
Appreciation Right held by an officer,
an owner of 10% or more of an equity
security of the Company that is
registered under the Securities Exchange
Act of 1934, or a director of the
Company, shall be automatically
exercised on such date within 30 days
prior to the effective date of such
transaction or dissolution as the Board
shall determine and, in the absence of
such determination, on the last business
day immediately prior to such effective
date.
7. TRANSFERABILITY.
No Stock Option or Stock Appreciation Right may be transferred,
assigned, pledged or hypothecated (whether by operation of law or otherwise),
except as provided by will or the applicable laws of descent or distribution,
and no Stock Option or Stock Appreciation Right shall be subject to execution,
attachment or similar process. Any attempted assignment, transfer, pledge,
hypothecation or other disposition of a Stock Option or Stock Appreciation
Right, or levy of attachment or similar process upon the Stock Option or Stock
Appreciation Right not specifically permitted herein shall be null and void and
without effect. A Stock Option or Stock Appreciation Right may be exercised
only by a key employee during his or her lifetime, or pursuant to Section 11
(c), by his or her estate or the person who acquires the right to exercise such
Stock Option or Stock Appreciation Right upon his or her death by bequest or
inheritance.
8. ADJUSTMENT PROVISIONS.
The aggregate number of shares of Common Stock with respect to
which Stock Options and Stock Appreciation Rights may be granted, the aggregate
number of shares of Common Stock subject to each outstanding Stock Option and
Stock Appreciation Right, and the option price per share of each such Stock
Option, may all be appropriately adjusted as the Board may determine for any
increase or decrease in the number of shares of issued Common Stock resulting
from a subdivision or consolidation of shares, whether through reorganization,
recapitalization, stock split-up, stock distribution or combination of shares,
or the payment of a share
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<PAGE> 9
dividend or other increase or decrease in the number of such shares outstanding
effected without receipt of consideration by the Company. Adjustments under
this Section 8 shall be made according to the sole discretion of the Board, and
its decisions shall be binding and conclusive.
9. DISSOLUTION, MERGER AND CONSOLIDATION.
Except as otherwise provided in Section 6(c)(ii), upon the
dissolution or liquidation of the Company, or upon a merger or consolidation of
the Company in which the Company is not the surviving corporation, each Stock
Option and Stock Appreciation Right granted hereunder shall expire as of the
effective date of such transaction; provided, however, that the Board shall
give at least 30 days prior written notice of such event to each optionee
during which time he or she shall have a right to exercise his or her (1)
vested or (2) if specifically provided in the option grant, vested and not
vested, wholly or partially unexercised Stock Option (without regard to
installment exercise limitations, if any) or Stock Appreciation Right and,
subject to prior expiration pursuant to Section 11(b) or (c), each Stock Option
and Stock Appreciation Right shall be exercisable after receipt of such written
notice and prior to the effective date of such transaction.
10. EFFECTIVE DATE AND CONDITIONS SUBSEQUENT TO EFFECTIVE DATE.
The Plan shall become effective on the date of the approval of the
Plan by the holders of a majority of the shares of Common Stock of the Company,
and the Plan shall be null and void and of no effect if such condition is not
fulfilled, and in such event each Stock Option or Stock Appreciation Right
granted hereunder shall, notwithstanding any of the preceding provisions of the
Plan, be null and void and of no effect. No grant or award shall be made under
the Plan more than ten (10) years from the date of shareholder approval hereof;
provided, however, that the Plan and all Stock Options and Stock Appreciation
Rights granted under the Plan prior to such date shall remain in effect and
subject to adjustment and amendment as herein provided until they have been
satisfied or terminated in accordance with the terms of the respective grants
or awards and the related agreements.
11. TERMINATION OF EMPLOYMENT.
(a) Each Stock Option and Stock Appreciation Right shall,
unless sooner expired pursuant to Section 11
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<PAGE> 10
(b) or (c) below, expire on the first to occur of the
date one day after the tenth anniversary of the date
of grant thereof or the expiration date set forth in
the applicable option agreement.
(b) A Stock Option and Stock Appreciation Right shall
expire on the first to occur of the applicable date
set forth in paragraph (a) next above and the date
that the employment of the key employee with the
Company and all subsidiaries terminates for any
reason other than death or disability. Upon receipt
of notice of termination of employment, whether
written or oral, Optionee shall not thereafter have
the right to exercise the Stock Option or Stock
Appreciation Rights. Notwithstanding the preceding
provisions of this paragraph, the Board, in its sole
discretion, may, by written notice given to a former
employee, permit the former employee to exercise
Stock Options or Stock Appreciation Rights during a
period following his or her termination of
employment, which period shall not exceed ninety (90)
days. In no event, however, may the Board permit a
former employee to exercise a Stock Option or Stock
Appreciation Right after the expiration date
contained in the agreement evidencing such Stock
Option or Stock Appreciation Right. Notwithstanding
the preceding provisions of this paragraph, if the
Board permits a former employee to exercise Stock
Options or Stock Appreciation Rights during a period
following his or her termination of employment
pursuant to such preceding provisions, such Stock
Options or Stock Appreciation Rights shall, to the
extent unexercised, expire on the date that such
former employee violates (as determined by the Board)
any covenant not to compete in effect between the
Company and/or its subsidiaries and the former
employee.
(c) If the employment of a key employee with the Company
and all subsidiaries terminates by reason of
disability (as determined by the Board) or by reason
of death, his or her Stock Options and Stock
Appreciation Rights, if any, shall expire on the
first to occur of the date set forth in paragraph
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<PAGE> 11
(a) of this Section 11 and the first anniversary of
such termination of employment.
12. MISCELLANEOUS.
(a) LEGAL AND OTHER REQUIREMENTS. The obligation of the
Company to sell and deliver Common Stock under the
Plan shall be subject to all applicable laws,
regulations, rules and approvals, including, but not
by way of limitation, the effectiveness of a
registration statement under the Securities Act of
1933 if deemed necessary or appropriate by the
Company. Certificates for shares of Common Stock
issued hereunder may bear such legend as the Board
shall deem appropriate.
(b) NO OBLIGATION TO EXERCISE OPTIONS. The granting of a
Stock Option shall impose no obligation upon an
optionee to exercise such Stock Option.
(c) TERMINATION AND AMENDMENT OF PLAN. The Board, without
further action on the part of the shareholders of the
Company, may from time to time alter, amend or
suspend the Plan or any Stock Option or Stock
Appreciation Right granted hereunder or may at any
time terminate the Plan, except that, unless approved
by the shareholders in accordance with Section 10
hereof, it may not (except to the extent provided in
Section 8 hereof): (i) change the total number of
shares of Common Stock available for grant under the
Plan; (ii) extend the duration of the Plan; (iii)
increase the maximum term of Stock Options; or (iv)
change the class of employees eligible to be granted
Stock Options or Stock Appreciation Rights under the
Plan. No action taken by the Board under this Section
may materially and adversely affect any outstanding
Stock Option or Stock Appreciation Right without the
consent of the holder thereof.
(d) APPLICATION OF FUNDS. The proceeds received by the
Company from the sale of Common Stock pursuant to
Stock Options will be used for general corporate
purposes.
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<PAGE> 12
(e) WITHHOLDING TAXES. Upon the exercise of any Stock
Option or Stock Appreciation Right, the Company shall
have the right to require the optionee to remit to
the Company an amount sufficient to satisfy an
federal, state and local withholding tax requirements
prior to the delivery of any certificate or
certificates for shares of Common Stock. Whenever
under the Plan payments are to be made by the Company
in cash or by check, such payments shall be net of
any amounts sufficient to satisfy all federal, state
and local withholding tax requirements.
(f) RIGHT TO TERMINATE EMPLOYMENT. Nothing in the Plan
or any agreement entered into pursuant to the Plan
shall confer upon any key employee or other optionee
the right to continue in the employment of the
Company or any subsidiary or affect any right which
the Company or any subsidiary may have to terminate
the employment of such key employee or other
optionee.
(g) RIGHTS AS A SHAREHOLDER. No optionee shall have any
right or privileges as a shareholder unless and until
certificates for shares of Common Stock are issued to
him or her.
(h) LEAVES OF ABSENCE AND DISABILITY. The Board shall be
entitled to make such rules, regulations and
determinations as it deems appropriate under the Plan
in respect of any leave of absence taken by or
disability of any key employee. Without limiting the
generality of the foregoing, the Board shall be
entitled to determine (i) whether or not any such
leaves of absence shall constitute a termination of
employment within the meaning of the Plan, and (ii)
the impact, if any, of any such leave of absence on
awards under the Plan theretofore made to any key
employee who takes such leave of absence.
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<PAGE> 13
(i) FAIR MARKET VALUE. Whenever the fair market value of
Common Stock is to be determined under the Plan as of
a given date, such fair market value shall be:
(i) If the Common Stock is traded on the
over-the-counter market, the average of
the mean between the bid and the asked
price for the Common Stock at the close
of trading for the ten (10) consecutive
trading days immediately preceding such
given date;
(ii) If the Common Stock is listed on a
national securities exchange, the
average of the closing prices of the
Common Stock on the Composite Tape for
the ten (10) consecutive trading days
immediately preceding such given date;
and
(iii) If the Common Stock is neither traded on
the over-the-counter market nor listed
on a national securities exchange, such
value as the Board, in good faith, shall
determine.
(j) NOTICES. Every direction, revocation or notice
authorized or required by the Plan shall be deemed
delivered to the Company (a) on the date it is
personally delivered to the Secretary of the Company
at its principal executive offices or (b) three
business days after it is sent by registered or
certified mail, postage prepaid, addressed to the
Secretary at such offices; and shall be deemed
delivered to an optionee (a) on the date it is
personally delivered to him or her or (b) three
business days after it is sent by registered or
certified mail, postage prepaid, addressed to him or
her at the last address shown for him or her on the
records of the Company.
(k) APPLICABLE LAW. All questions pertaining to the
validity, construction and administration of the Plan
and Stock Options and Stock Appreciation Rights
granted hereunder shall be determined in conformity
with the laws of the State of Texas.
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<PAGE> 14
(l) ELIMINATION OF FRACTIONAL SHARES. If under any
provision of the Plan which requires a computation of
the number of shares of Common Stock subject to a
Stock Option or Stock Appreciation Right, the number
so computed is not a whole number of shares of Common
Stock, such number of shares of Common Stock shall be
rounded down to the next whole number.
(m) SHAREHOLDERS' AGREEMENT. Notwithstanding anything to
the contrary contained in the Plan, the Company shall
be under no obligation to sell or deliver Common
Stock under the Plan to an optionee unless such
optionee shall execute (i) the Shareholders'
Agreement dated effective in December 31, 1990, (ii)
the Selected Shareholders' Agreement dated May 27,
1992, and (iii) the Stockholders Agreement dated May
27, 1992 with respect to such Common Stock, a copies
of which will be furnished Optionee reasonably prior
to any exercise.
This Plan, in accordance with Section 10, is effective as of the
approval of shareholders evidenced in the Preamble hereof.
CHAMPION HEALTHCARE CORPORATION
By:
----------------------------
Its:
-----------------------
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<PAGE> 15
AMENDMENT NO. 1 TO CHAMPION HEALTHCARE CORPORATION
EMPLOYEE STOCK OPTION PLAN NO. 3
This Amendment No. 1 to the Champion Healthcare Corporation Employee Stock
Option Plan No. 3 is effective this 6th day of December, 1994, upon the
execution hereof by Champion Healthcare Corporation and the holders of options
on the date hereof whose signatures appear below.
PREAMBLE. Pursuant to authority granted by the Board of Directors of Champion
Healthcare Corporation on August 9, 1994, the hereinbelow described amendment
(the "Amendment") was adopted to the Employee Stock Option Plan No. 3 (the
"Plan"). This Amendment was approved by the shareholders on December 6, 1994,
with an effective date for all purposes as of the date set forth in the first
paragraph above.
AMENDMENT. Section 9 of the Plan is hereby amended so that Stock Options and
Stock Appreciation Rights will not expire upon the merger or consolidation of
the Company, and Section 9 is amended to read in its entirety as follows:
9. DISSOLUTION, MERGER AND CONSOLIDATION.
Except as otherwise provided in Section 6(c)(ii),
upon the dissolution or liquidation of the Company or upon a merger
or consolidation of the Company in which the Company is not the
surviving corporation and for which the plan or agreement of merger
or consolidation does not provide for assumption by the surviving
or consolidated corporation of Stock Options and/or Stock
Appreciation Rights granted hereunder, each Stock Option and Stock
Appreciation Right granted hereunder shall expire as of the
effective date of such dissolution or liquidation; provided,
however, that the Board shall give at least 30 days prior written
notice of such event to each optionee during which time he or she
shall have a right to exercise his or her (1) vested or (2) if
specifically provided in the option grant, vested and unvested,
wholly or partially unexercised Stock Option (without regard to
installment exercise limitations, if any) or Stock Appreciation
Right and, subject to prior expiration pursuant to Section 11(b) or
(c), each Stock Option and Stock Appreciation Right shall be
exercisable after receipt of such written notice and prior to the
effective date of such transaction. Any term or provision in this
Plan to the contrary notwithstanding, in the event of a merger or
consolidation of the Company in which the Company is not the
surviving corporation and for which the plan or agreement of merger
or consolidation does provide for assumption by the surviving or
consolidated corporation of Stock Options or Stock Appreciation
Rights granted hereunder, each Stock Option and Stock Appreciation
Right granted hereunder shall survive such merger or consolidation,
and shall become and remain an obligation of the surviving
corporation, and shall be adjusted according to the adjustment
provisions of Section 8 of the Plan.
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<PAGE> 16
AGREEMENT OF EXISTING OPTION HOLDERS. The undersigned individual, a holder of
an option issued pursuant to the Plan, hereby consents and agrees to the
Amendment.
COUNTERPARTS. This Amendment may be executed in one or more counterparts, each
of which shall be considered an original and together shall constitute the one
and same document.
CHAMPION HEALTHCARE CORPORATION
By:
-------------------------------
James G. VanDevender,
Executive Vice-president
OPTION HOLDER
-------------------------------
Print Name:
--------------------
OPTION HOLDER
-------------------------------
Print Name:
--------------------
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<PAGE> 1
EXHIBIT 4.9
CHAMPION HEALTHCARE CORPORATION
DIRECTORS' STOCK OPTION PLAN
PREAMBLE. The Board of Directors of Champion Healthcare Corporation adopted
the hereinbelow described Directors' Stock Option Plan effective as of
____________, 1992 and it was approved by the shareholders with an effective
date for all purposes of __________, 1992.
1. PURPOSE
The purpose of this Directors' Stock Option Plan (the "Plan") is to give
those members of the Board of Directors of Champion Healthcare Corporation (the
"Company") who are not elected as representatives of existing Series A Preferred
Stockholders, Series B Preferred Stockholders or management pursuant to any
agreement ("key directors") an opportunity to acquire shares of the common
stock of the Company, no par value ("Common Stock"), to provide an incentive for
key directors to continue to promote the best interests of the Company and
enhance its long-term performance.
2. ADMINISTRATION.
(a) BOARD OF DIRECTORS. The Plan shall be administered by the Board
of Directors of the Company (the "Board"), which, to the extent it
shall determine, may delegate its powers with respect to the
administration of the Plan (except its powers under Section 12(c))
to a committee of directors (the "Committee") appointed by the
Board and composed of not less than two members of the Board, none
of who can be an eligible key director. If the Board chooses to
appoint a Committee, references hereinafter to the Board (except
in Section 12(c)) shall be deemed to refer to the Committee.
Notwithstanding the preceding provisions of this Section, no
member of the Board may exercise discretion with respect to, or
participate in, the administration of the Plan if, at any time
within one year prior to such exercise or participation, he or she
has received stock, stock options, stock appreciation rights or
any other derivative security pursuant to the Plan or any other
plan of
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<PAGE> 2
the Company or any affiliate thereof as to which any discretion is
exercised.
(b) POWERS. Within the limits of the express provisions of the Plan,
the Board shall determine: (i) the key directors to whom awards
hereunder shall be granted, (ii) the time or times at which such
awards shall be granted, (iii) the form and amount of the awards,
and (iv) the limitations, restrictions and conditions applicable
to any such award. In making such determinations, the Board may
take into account the nature of the services rendered by such
directors, their present and potential contributions to the
Company's success and such other factors as the Board in its
discretion shall deem relevant.
(c) INTERPRETATIONS. Subject to the express provisions of the Plan,
the Board may interpret the Plan, prescribe, amend and rescind
rules and regulations relating to it, determine the terms and
provisions of the respective awards and make all other
determinations it deems necessary or advisable for the
administration of the Plan.
(d) DETERMINATIONS. The determinations of the Board on all matters
regarding the Plan shall be conclusive. A member of the Board
shall only be liable for any action taken or determination made in
bad faith.
(e) NONUNIFORM DETERMINATIONS. The Board's determinations under the
Plan, including without limitation, determinations as to the
persons to receive awards, the terms and provisions of such awards
and the agreements evidencing the same, need not be uniform and
may be made by it selectively among persons who receive or are
eligible to receive awards under the Plan, whether or not such
persons are similarly situated.
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<PAGE> 3
3. AWARDS UNDER THE PLAN.
(a) TYPE OF AWARD. Awards under the Plan may be granted in any either
or both of the following forms: (i) Nonstatutory Stock Options, as
described in Section 4, and (ii) Stock Appreciation Rights, as
described in Section 6. Nonstatutory Stock Options shall be
referred to herein as "Stock Options."
(b) MAXIMUM LIMITATIONS. The aggregate number of shares of Common
Stock available for grant under the Plan is 30,000, subject to
adjustment pursuant to Section 8. Shares of Common Stock issued
pursuant to the Plan may be either authorized but unissued shares
or shares now or hereafter held in the treasury of the Company. In
the event that, prior to the end of the period during which Stock
Options may be granted under the Plan, any Stock Option under the
Plan expires unexercised or is terminated, surrendered or
cancelled (other than in connection with the exercise of a Stock
Appreciation Right) without being exercised, in whole or in part,
for any reason, the number of shares theretofore subject to such
Stock Option or the unexercised, terminated, forfeited or unearned
portion thereof, shall be added to the remaining number of shares
of Common Stock available for grant as a Stock Option under the
Plan, including a grant to a former holder of such Stock Option,
upon such terms and conditions as the Board shall determine, which
terms may be more or less favorable than those applicable to such
former Stock Option.
4. STOCK OPTIONS.
(a) CONDITIONS. Stock Options may be granted under the Plan for the
purchase of shares of Common Stock. Stock Options shall be in such
form and upon such terms and conditions as the Board shall from
time to time determine, subject to the following.
(i) OPTION PRICE. The option price of each Stock Option to
purchase Common Stock shall
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<PAGE> 4
be determined by the Board, but shall not be less than 80%
of the fair market value of the Common Stock subject to
such Stock Option on the date of grant.
(ii) TERM OF OPTIONS. No Stock Option shall be exercisable
after the date ten (10) years and one (1) day from the
date such Stock Option is granted.
(iii) CONDITIONS OF GRANT. The Board, in its discretion, may,
as a condition to the grant of a Stock Option, require a
key director who is the recipient of such Stock Option to
enter into one or more of the following agreements with
the Company on or prior to the date of grant of such
Option:
a) A covenant not to compete with the Company and its
subsidiaries and which shall contain such terms
and conditions as shall be specified by the Board;
b) An agreement to cancel any employment agreement,
fringe benefit or compensation arrangement in
effect between the Company and the key director.
c) The Shareholders' Agreement dated effective
December 31, 1990 among the Company and Company
Shareholders set forth in Schedule I to that
agreement.
d) The Selected Shareholders' Agreement dated May 27,
1992 among the Company and the shareholders listed
therein.
e) The Stockholders Agreement dated May 27, 1992 among
the Company and the stockholders listed therein.
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<PAGE> 5
If the key director shall fail to enter into any such agreement at the request
of the Board, then no Stock Option shall be granted hereunder to such key
director and the number of shares of Common Stock which would have been subject
to such Option shall be added to the remaining number of shares of Common Stock
available for grant as a Stock Option under the Plan.
(b) FORM. The form of the stock option agreement shall subject to
paragraph (a) immediately above, be substantially in the form as
Exhibit 1 hereto.
5. PROVISIONS APPLICABLE TO STOCK OPTIONS.
(a) EXERCISE. Stock Options shall be subject to such terms and
conditions, shall be exercisable at such time or times, and shall
be evidenced by such form of written option agreement between the
optionee and the Company, as the Board shall determine; provided,
that such determinations are not inconsistent with the other
provisions of the Plan.
(b) MANNER OF EXERCISE OF OPTIONS AND PAYMENT FOR COMMON STOCK. Stock
Options may be exercised by an optionee by giving written notice
to the Secretary of the Company stating the number of shares of
Common Stock with respect to which the Stock Option is being
exercised and tendering payment therefor. At the time that a Stock
Option granted under the Plan, or any part thereof, is exercised,
payment for the Common Stock issuable thereupon shall be made in
full in cash or by certified check or, if the Board in its
discretion agrees to accept, in shares of Common Stock of the
Company (the number of such shares paid for each share subject to
the Stock Option, or part thereof, being exercised shall be
determined by dividing the option price by the fair market value
per share of the Common Stock on the date of exercise). As soon as
reasonably possible following such exercise, a certificate
representing shares of Common Stock purchased, registered in the
name of the optionee, shall be delivered to the optionee.
(c) CANCELLATION OF STOCK APPRECIATION RIGHTS. The exercise of any
Stock Option shall cancel that
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<PAGE> 6
number, if any, of Stock Appreciation Rights (as defined in
Section 6) included in such Stock Option, which is equal to the
excess of (i) the number of shares of Common Stock subject to
Stock Appreciation Rights included in such Stock Option, over (ii)
the number of shares of Common Stock which remain subject to such
Stock Option after such exercise.
6. STOCK APPRECIATION RIGHTS.
(a) AWARD. If deemed by the Board to be in the best interest of the
Company, any Stock Option granted under the Plan may include a
stock appreciation right ("Stock Appreciation Right"), either at
the time of grant or thereafter while the Stock Option is
outstanding.
(b) TERMS OF RIGHTS. Stock Appreciation Rights shall be subject to
such terms and conditions not inconsistent with the other
provisions of the Plan as the Board shall determine; provided
that:
(i) LIMITATIONS. A Stock Appreciation Right shall be
exercisable to the extent, and only to the extent, the
Stock Option in which it is included is exercisable and
shall be exercisable only for such period as the Board may
determine (which period may expire prior to the expiration
date of such Stock Option).
(ii) SURRENDER OR EXCHANGE. A Stock Appreciation Right shall
entitle the optionee to surrender to the Company
unexercised the Stock Option, or portion thereof, to which
it is related, or any portion thereof, and to receive from
the Company in exchange therefor that number of shares of
Common Stock having an aggregate fair market value equal to
the excess of the fair market value on the date of exercise
of one share of Common Stock over the option price per
share specified in such Stock Option, multiplied by the
number of shares of
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<PAGE> 7
Common Stock subject to the Stock Option, or portion
thereof, which is so surrendered. The Board shall be
entitled to elect to settle any part or all of the
Company's obligation arising out of the exercise of a Stock
Appreciation Right by the payment to the optionee of cash
or by check equal to the aggregate fair market value on the
date on which the Stock Appreciation Right is exercised of
that part or all of the shares of Common Stock the Company
would otherwise be obligated to deliver.
(c) CASH SETTLEMENT RESTRICTIONS.
(i) Notwithstanding Sections 6(b) and 9 hereof, so long as the
grantee of a Stock Appreciation Right is an officer, an
owner of 10% or more of an equity security of the Company
that is registered under the Securities Exchange Act of
1934, or a director of the Company, the Company's right to
elect to settle any part or all of its obligation arising
out of the exercise of a Stock Appreciation Right by the
payment of cash or by check shall not apply unless such
exercise occurs either: (1) pursuant to the provisions of
subsection (ii) below, or (2) during the period beginning
on the third business day following the date of release by
the Company for publication of its quarterly or annual
summary statements of sales and earnings and ending on the
twelfth business day following such date.
(ii) In the event that, pursuant to Section 9, the Company shall
cancel all unexercised Stock Options as of the effective
date of a merger or other transaction provided therein or
in the case of dissolution of the Company, then each Stock
Appreciation Right held by an officer, an owner of 10% or
more of an equity security of the
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<PAGE> 8
Company that is registered under the Securities Exchange
Act of 1934, or a director of the Company, shall be
automatically exercised on such date within 30 days prior
to the effective date of such transaction or dissolution as
the Board shall determine and, in the absence of such
determination, on the last business day immediately prior
to such effective date.
7. TRANSFERABILITY.
No Stock Option or Stock Appreciation Right may be transferred, assigned,
pledged or hypothecated (whether by operation of law or otherwise), except as
provided by will or the applicable laws of descent or distribution, and no Stock
Option or Stock Appreciation Right shall be subject to execution, attachment or
similar process. Any attempted assignment, transfer, pledge, hypothecation or
other disposition of a Stock Option or Stock Appreciation Right, or levy of
attachment or similar process upon the Stock Option or Stock Appreciation Right
not specifically permitted herein shall be null and void and without effect. A
Stock Option or Stock Appreciation Right may be exercised only by a key director
his or her lifetime, or pursuant to Section 11 (c), by his or her estate or the
person who acquires the right to exercise such Stock Option or Stock
Appreciation Right upon his or her death by bequest or inheritance.
8. ADJUSTMENT PROVISIONS.
The aggregate number of shares of Common Stock with respect to which Stock
Options and Stock Appreciation Rights may be granted, the aggregate number of
shares of Common Stock subject to each outstanding Stock Option and Stock
Appreciation Right, and the option price per share of each such Stock Option,
may all be appropriately adjusted as the Board may determine for any increase or
decrease in the number of shares of issued Common Stock resulting from a
subdivision or consolidation of shares, whether through reorganization,
recapitalization, stock split-up, stock distribution or combination of shares,
or the payment of a share dividend or other increase or decrease in the number
of such shares outstanding effected without receipt of consideration by the
Company. Adjustments under this Section 8 shall be made according to the sole
discretion of the Board, and its decisions shall be binding and conclusive.
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<PAGE> 9
9. DISSOLUTION, MERGER AND CONSOLIDATION.
Except as otherwise provided in Section 6(c)(ii), upon the dissolution or
liquidation of the Company, or upon a merger or consolidation of the Company in
which the Company is not the surviving corporation, each Stock Option and Stock
Appreciation Right granted hereunder shall expire as of the effective date of
such transaction; provided, however, that the Board shall give at least 30 days
prior written notice of such event to each optionee during which time he or she
shall have a right to exercise his or her (1) vested or (2) if specifically
provided in the option grant, vested and not vested, wholly or partially
unexercised Stock Option (without regard to installment exercise limitations, if
any) or Stock Appreciation Right and, subject to prior expiration pursuant to
Section 11(b) or (c), each Stock Option and Stock Appreciation Right shall be
exercisable after receipt of such written notice and prior to the effective date
of such transaction.
10. EFFECTIVE DATE AND CONDITIONS SUBSEQUENT TO EFFECTIVE DATE.
The Plan shall become effective on the date of the approval of the Plan by
the holders of a majority of the shares of Common Stock of the Company, and the
Plan shall be null and void and of no effect if such condition is not fulfilled,
and in such event each Stock Option or Stock Appreciation Right granted
hereunder shall, notwithstanding any of the preceding provisions of the Plan, be
null and void and of no effect. No grant or award shall be made under the Plan
more than ten (10) years from the date of shareholder approval hereof; provided,
however, that the Plan and all Stock Options and Stock Appreciation Rights
granted under the Plan prior to such date shall remain in effect and subject to
adjustment and amendment as herein provided until they have been satisfied or
terminated in accordance with the terms of the respective grants or awards and
the related agreements.
11. TERMINATION OF DIRECTORSHIP.
(a) Each Stock Option and Stock Appreciation Right shall, unless
sooner expired pursuant to Section 11 (b) or (c) below, expire on
the first to occur of the date one day after the tenth anniversary
of the date of grant thereof or the expiration date set forth in
the applicable option agreement.
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<PAGE> 10
(b) A Stock Option and Stock Appreciation Right shall expire on the
first to occur of the applicable date set forth in paragraph (a)
next above or ninety (90) days after the date that the key
director ceases to be a director of the Company for any reason
other than death or disability. Notwithstanding the preceding
provisions of this paragraph, the Board, in its sole discretion,
may, by written notice given to a former key Director, permit the
former director to exercise Stock Options or Stock Appreciation
Rights during a period which period shall not exceed ninety (90)
days. In no event, however, may the Board permit a former director
to exercise a Stock Option or Stock Appreciation Right after the
expiration date contained in the agreement evidencing such Stock
Option or Stock Appreciation Right. Notwithstanding the preceding
provisions of this paragraph, if the Board permits a former
director to exercise Stock Options or Stock Appreciation Rights
during a period pursuant to such preceding provisions, such Stock
Options or Stock Appreciation Rights shall, to the extent
unexercised, expire on the date that such former director violates
(as determined by the Board) any covenant not to compete in effect
between the Company,
(c) If a key director terminates his position by reason of disability
(as determined by the Board) or by reason of death, his or her
Stock Options and Stock Appreciation Rights, if any, shall expire
on the first to occur of the date set forth in paragraph (a) of
this Section 11 and the first anniversary of such termination.
12. MISCELLANEOUS.
(a) LEGAL AND OTHER REQUIREMENTS. The obligation of the Company to
sell and deliver Common Stock under the Plan shall be subject to
all applicable laws, regulations, rules and approvals, including,
but not by way of limitation, the effectiveness of a registration
statement under the Securities Act of 1933 if deemed necessary or
appropriate by the
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<PAGE> 11
Company. Certificates for shares of Common Stock issued hereunder
may bear such legend as the Board shall deem appropriate.
(b) NO OBLIGATION TO EXERCISE OPTIONS. The granting of a Stock Option
shall impose no obligation upon an optionee to exercise such Stock
Option.
(c) TERMINATION AND AMENDMENT OF PLAN. The Board, without further
action on the part of the shareholders of the Company, may from
time to time alter, amend or suspend the Plan or any Stock Option
or Stock Appreciation Right granted hereunder or may at any time
terminate the Plan, except that, unless approved by the
shareholders in accordance with Section 10 hereof, it may not
(except to the extent provided in Section 8 hereof): (i) change
the total number of shares of Common Stock available for grant
under the Plan; (ii) extend the duration of the Plan; (iii)
increase the maximum term of Stock Options; or (iv) change the
class of persons eligible to be granted Stock Options or Stock
Appreciation Rights under the Plan. No action taken by the Board
under this Section may materially and adversely affect any
outstanding Stock Option or Stock Appreciation Right without the
consent of the holder thereof.
(d) APPLICATION OF FUNDS. The proceeds received by the Company from
the sale of Common Stock pursuant to Stock Options will be used
for general corporate purposes.
(e) WITHHOLDING TAXES. Upon the exercise of any Stock Option or Stock
Appreciation Right, the Company shall have the right to require
the optionee to remit to the Company an amount sufficient to
satisfy an federal, state and local withholding tax requirements
prior to the delivery of any certificate or certificates for
shares of Common Stock. Whenever under the Plan payments are to be
made by the Company in cash or by check, such payments shall be
net of any amounts sufficient to satisfy all federal, state and
local withholding tax requirements.
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<PAGE> 12
(f) RIGHT TO TERMINATE . Nothing in the Plan or any agreement entered
into pursuant to the Plan shall confer upon any key director or
other optionee the right to continue in such position or affect
any right which the Company may have to terminate the position of
such key director or other optionee.
(g) RIGHTS AS A SHAREHOLDER. No optionee shall have any right or
privileges as a shareholder unless and until certificates for
shares of Common Stock are issued to him or her.
(h) LEAVES OF ABSENCE AND DISABILITY. The Board shall be entitled to
make such rules, regulations and determinations as it deems
appropriate under the Plan in respect of any leave of absence taken
by or disability of any key director. Without limiting the
generality of the foregoing, the Board shall be entitled to
determine the impact, if any, of any such leave of absence on
awards under the Plan theretofore made to any key director who
takes such leave of absence.
(i) FAIR MARKET VALUE. Whenever the fair market value of Common Stock
is to be determined under the Plan as of a given date, such fair
market value shall be:
(i) If the Common Stock is traded on the overthe-counter
market, the average of the mean between the bid and the
asked price for the Common Stock at the close of trading
for the ten (10) consecutive trading days immediately
preceding such given date;
(ii) If the Common Stock is listed on a national securities
exchange, the average of the closing prices of the Common
Stock on the Composite Tape for the ten (10) consecutive
trading days immediately preceding such given date; and
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<PAGE> 13
(iii) If the Common Stock is neither traded on the
over-the-counter market nor listed on a national securities
exchange, such value as the Board, in good faith, shall
determine.
(j) NOTICES. Every direction, revocation or notice authorized or
required by the Plan shall be deemed delivered to the Company (a)
on the date it is personally delivered to the Secretary of the
Company at its principal executive offices or (b) three business
days after it is sent by registered or certified mail, postage
prepaid, addressed to the Secretary at such offices; and shall be
deemed delivered to an optionee (a) on the date it is personally
delivered to him or her or (b) three business days after it is
sent by registered or certified mail, postage prepaid, addressed
to him or her at the last address shown for him or her on the
records of the Company.
(k) APPLICABLE LAW. All questions pertaining to the validity,
construction and administration of the Plan and Stock Options and
Stock Appreciation Rights granted hereunder shall be determined in
conformity with the laws of the State of Texas.
(l) ELIMINATION OF FRACTIONAL SHARES. If under any provision of the
Plan which requires a computation of the number of shares of
Common Stock subject to a Stock Option or Stock Appreciation
Right, the number so computed is not a whole number of shares of
Common Stock, such number of shares of Common Stock shall be
rounded down to the next whole number.
(m) SHAREHOLDERS' AGREEMENT. Notwithstanding anything to the contrary
contained in the Plan, the Company shall be under no obligation to
sell or deliver Common Stock under the Plan to an optionee unless
such optionee shall execute (i) the Shareholders' Agreement dated
effective in December 31, 1990, (ii) the Selected Shareholders'
Agreement dated May 27, 1992, and (iii) the Stockholders Agreement
dated May 27, 1992, with respect to such Common
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<PAGE> 14
Stock, a copies of which will be furnished Optionee reasonably
prior to any exercise.
This Plan, in accordance with Section 10, is effective as of the approval
of shareholders evidenced in the Preamble hereof.
CHAMPION HEALTHCARE CORPORATION
By:
-------------------------------
Its:
-------------------------------
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<PAGE> 15
AMENDMENT NO. 1 TO CHAMPION HEALTHCARE CORPORATION
DIRECTORS' STOCK OPTION PLAN
This Amendment No. 1 to the Champion Healthcare Corporation Directors' Stock
Option Plan is effective this 6th day of December, 1994, upon the execution
hereof by Champion Healthcare Corporation and the holders of options on the date
hereof whose signatures appear below.
PREAMBLE. Pursuant to authority granted by the Board of
Directors of Champion Healthcare Corporation on August 9, 1994, the hereinbelow
described amendment (the "Amendment") was adopted to the Directors' Stock Option
Plan (the "Plan"). This Amendment was approved by the shareholders on December
6, 1994, with an effective date for all purposes as of the date set forth in the
first paragraph above.
AMENDMENT. Section 9 of the Plan is hereby amended so that Stock Options
and Stock Appreciation Rights will not expire upon the merger or consolidation
of the Company, and Section 9 is amended to read in its entirety as follows:
9. DISSOLUTION, MERGER AND CONSOLIDATION.
Except as otherwise provided in Section 6(c)(ii), upon the
dissolution or liquidation of the Company or upon a merger or
consolidation of the Company in which the Company is not the
surviving corporation and for which the plan or agreement of merger
or consolidation does not provide for assumption by the surviving or
consolidated corporation of Stock Options and/or Stock Appreciation
Rights granted hereunder, each Stock Option and Stock Appreciation
Right granted hereunder shall expire as of the effective date of
such dissolution or liquidation; provided, however, that the Board
shall give at least 30 days prior written notice of such event to
each optionee during which time he or she shall have a right to
exercise his or her (1) vested or (2) if specifically provided in
the option grant, vested and unvested, wholly or partially
unexercised Stock Option (without regard to installment exercise
limitations, if any) or Stock Appreciation Right and, subject to
prior expiration pursuant to Section 11(b) or (c), each Stock Option
and Stock Appreciation Right shall be exercisable after receipt of
such written notice and prior to the effective date of such
transaction. Any term or provision in this Plan to the contrary
notwithstanding, in the event of a merger or consolidation of the
Company in which the Company is not the surviving corporation and
for which the plan or agreement of merger or consolidation does
provide for assumption by the surviving or consolidated corporation
of Stock Options or Stock Appreciation Rights granted hereunder,
each Stock Option and Stock Appreciation Right granted hereunder
shall survive such merger or consolidation, and shall become and
remain an obligation of the surviving corporation, and shall be
adjusted according to the adjustment provisions of Section 8 of the
Plan.
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<PAGE> 16
AGREEMENT OF EXISTING OPTION HOLDERS. The undersigned individual, a
holder of an option issued pursuant to the Plan, hereby consents and agrees to
the Amendment.
COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which shall be considered an original and together shall
constitute the one and same document.
CHAMPION HEALTHCARE CORPORATION
By:
-------------------------------
James G. VanDevender,
Executive Vice-president
OPTION HOLDER
-------------------------------
Print Name:
--------------------
OPTION HOLDER
--------------------------------
Print Name:
---------------------
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<PAGE> 1
EXHIBIT 4.10
CHAMPION HEALTHCARE CORPORATION
PHYSICIANS STOCK OPTION PLAN
PREAMBLE. The Board of Directors of Champion Healthcare Corporation adopted
the hereinbelow described Physicians Stock Option Plan effective as of May 27,
1993.
1. PURPOSE
The purpose of this Physicians Stock Option Plan (the "Plan") is to
give physicians who are admitted to the medical staffs of the hospitals
("qualified physicians") of Champion Healthcare Corporation, a Texas
corporation (the "Company"), and hospitals with respect to which the Company
directly or indirectly controls 50% or more of the combined voting power
("subsidiaries"), an opportunity to acquire shares of the common stock of the
Company, no par value ("Common Stock").
2. ADMINISTRATION.
(a) BOARD OF DIRECTORS. The Plan shall be administered
by the Board of Directors of the Company (the
"Board"), which, to the extent it shall determine,
may delegate its powers with respect to the
administration of the Plan (except its powers under
Section 11(c)) to a committee of directors (the
"Committee") appointed by the Board and composed of
not less than two members of the Board. If the Board
chooses to appoint a Committee, references
hereinafter to the Board (except in Section 11(c))
shall be deemed to refer to the Committee.
Notwithstanding the preceding provisions of this
Section, no member of the Board may exercise
discretion with respect to, or participate in, the
administration of the Plan if, at any time within one
year prior to such exercise or participation, he or
she has received stock, stock options or any other
derivative security pursuant to the Plan.
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<PAGE> 2
(b) POWERS. Within the limits of the express provisions
of the Plan, the Board shall determine: (i) the
qualified physicians to whom awards hereunder shall
be granted, (ii) the time or times at which such
awards shall be granted, (iii) the form and amount of
the awards, and (iv) the limitations, restrictions
and conditions applicable to any such award. In
making such determinations, the Board may take into
account such other factors as the Board in its
discretion shall deem relevant.
(c) INTERPRETATIONS. Subject to the express provisions
of the Plan, the Board may interpret the Plan,
prescribe, amend and rescind rules and regulations
relating to it, determine the terms and provisions of
the respective awards and make all other
determinations it deems necessary or advisable for
the administration of the Plan.
(d) DETERMINATIONS. The determinations of the Board on
all matters regarding the Plan shall be conclusive. A
member of the Board shall only be liable for any
action taken or determination made in bad faith.
(e) NONUNIFORM DETERMINATIONS. The Board's
determinations under the Plan, including without
limitation, determinations as to the persons to
receive awards, the terms and provisions of such
awards and the agreements evidencing the same, need
not be uniform and may be made by it selectively
among persons who receive or are eligible to receive
awards under the Plan, whether or not such persons
are similarly situated.
3. AWARDS UNDER THE PLAN.
(a) TYPE OF AWARD. Awards under the Plan may be granted
in the following form: (i) Nonstatutory Stock
Options, as described in Section 4. Nonstatutory
Stock Options shall be referred to herein as "Stock
Options."
(b) MAXIMUM LIMITATIONS. The aggregate number of shares
of Common Stock available for grant under
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<PAGE> 3
the Plan is 100,000, subject to adjustment pursuant
to Section 7. Shares of Common Stock issued pursuant
to the Plan may be either authorized but unissued
shares or shares now or hereafter held in the
treasury of the Company. In the event that, prior to
the end of the period during which Stock Options may
be granted under the Plan, any Stock Option under the
Plan expires unexercised or is terminated,
surrendered or cancelled without being exercised, in
whole or in part, for any reason, the number of
shares theretofore subject to such Stock Option or
the unexercised, terminated, forfeited or unearned
portion thereof, shall be added to the remaining
number of shares of Common Stock available for grant
as a Stock Option under the Plan, including a grant
to a former holder of such Stock Option, upon such
terms and conditions as the Board shall determine,
which terms may be more or less favorable than those
applicable to such former Stock Option.
4. STOCK OPTIONS.
(a) CONDITIONS. Stock Options may be granted under the
Plan for the purchase of shares of Common Stock.
Stock Options shall be in such form and upon such
terms and conditions as the Board shall from time to
time determine, subject to the following.
(i) OPTION PRICE. The option price of each
Stock Option to purchase Common Stock
shall be determined by the Board, but
shall not be less than 80% of the fair
market value of the Common Stock subject
to such Stock Option on the date of
grant or $11.80, whichever is greater.
(ii) TERM OF OPTIONS. No Stock Option shall
be exercisable after the date ten (10)
years and one (1) day from the date such
Stock Option is granted.
(iii) CONDITIONS OF GRANT. The Board, in its
discretion, may, as a condition to the
grant of a Stock Option, require a
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<PAGE> 4
qualified physician who is the recipient
of such Stock Option to enter into one
or more of the following agreements with
the Company on or prior to the date of
grant of such Option:
a) The Shareholders' Agreement
dated effective December 31,
1990 among the Company and
Company Shareholders set forth
in Schedule I to that
agreement.
b) The Selected Shareholders'
Agreement dated May 27, 1992
among the Company and the
Shareholders listed therein.
c) The Stockholders Agreement
dated May 27, 1992 among the
Company and the Stockholders
listed therein.
If the qualified physician shall fail to enter into any such agreement at the
request of the Board, then no Stock Option shall be granted hereunder to such
qualified physician and the number of shares of Common Stock which would have
been subject to such Option shall be added to the remaining number of shares of
Common Stock available for grant as a Stock Option under the Plan.
(iv). CONSIDERATIONS TO GRANT. The Board in
exercising its discretion to grant
options to qualified physicians shall
a) Not require that the qualified
physician admit or refer
patients to a Company or
Subsidiary hospital;
b) Not grant options based or
conditioned upon the number
of referrals to a Company or
Subsidiary hospital;
c) Not condition the exercise or
vesting schedule of the
options
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<PAGE> 5
upon referrals to the Company
or Sub-sidiary hospital;
d) Not provide for any special
payment plan or procedure upon
the exercise of an option
other than the full payment in
cash or as may otherwise be
provided herein; and
e) Not create any condition that
would work as a forfeiture of
the options should the
qualified physician cease
referring patients to the
Company or Subsidiary
hospital.
(b) FORM. The form of the stock option agreement shall,
subject to paragraph 4(a) immediately above, be
substantially in the form as Exhibit 1 hereto.
5. PROVISIONS APPLICABLE TO STOCK OPTIONS.
(a) EXERCISE. Stock Options shall be subject to such
terms and conditions, shall be exercisable at such
time or times, and shall be evidenced by such form of
written option agreement between the optionee and the
Company, as the Board shall determine; provided, that
such determinations are not inconsistent with the
other provisions of the Plan.
(b) MANNER OF EXERCISE OF OPTIONS AND PAYMENT FOR COMMON
STOCK. Stock Options may be exercised by an optionee
by giving written notice to the Secretary of the
Company stating the number of shares of Common Stock
with respect to which the Stock Option is being
exercised and tendering payment therefor. At the time
that a Stock Option granted under the Plan, or any
part thereof, is exercised, payment for the Common
Stock issuable thereupon shall be made in full in
cash or by certified check or, if the Board in its
discretion agrees to accept, in shares of Common
Stock of the Company (the number of such shares paid
for each share subject to the Stock Option, or part
thereof, being exercised shall be determined by
dividing the option price by the fair market value
per share of the Common Stock
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<PAGE> 6
on the date of exercise). As soon as reasonably
possible following such exercise, a certificate
representing shares of Common Stock purchased,
registered in the name of the optionee, shall be
delivered to the optionee.
6. TRANSFERABILITY.
No Stock Option may be transferred, assigned, pledged or
hypothecated (whether by operation of law or otherwise), except as provided by
will or the applicable laws of descent or distribution, and no Stock Option
shall be subject to execution, attachment or similar process. Any attempted
assignment, transfer, pledge, hypothecation or other disposition of a Stock
Option, or levy of attachment or similar process upon the Stock Option not
specifically permitted herein shall be null and void and without effect. A
Stock Option may be exercised only by a qualified physician during his or her
lifetime, or pursuant to Section 10 (c), by his or her estate or the person who
acquires the right to exercise such Stock Option upon his or her death by
bequest or inheritance.
7. ADJUSTMENT PROVISIONS.
The aggregate number of shares of Common Stock with respect to
which Stock Options may be granted, the aggregate number of shares of Common
Stock subject to each outstanding Stock Option, and the option price per share
of each such Stock Option, may all be appropriately adjusted as the Board may
determine for any increase or decrease in the number of shares of issued Common
Stock resulting from a subdivision or consolidation of shares, whether through
reorganization, recapitalization, stock split-up, stock distribution or
combination of shares, or the payment of a share dividend or other increase or
decrease in the number of such shares outstanding effected without receipt of
consideration by the Company. Adjustments under this Section 7 shall be made
according to the sole discretion of the Board, and its decisions shall be
binding and conclusive.
8. DISSOLUTION, MERGER AND CONSOLIDATION.
Upon the dissolution or liquidation of the Company, or upon a
merger or consolidation of the Company in which the Company is not the
surviving corporation, each Stock Option granted hereunder shall expire as of
the effective date of such transaction;
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<PAGE> 7
provided, however, that the Board shall give at least 30 days prior written
notice of such event to each optionee during which time he or she shall have a
right to exercise his or her (1) vested or (2) if specifically provided in the
option grant, vested and not vested, wholly or partially unexercised Stock
Option (without regard to installment exercise limitations, if any) and,
subject to prior expiration pursuant to Section 10(b) or (c), each Stock Option
shall be exercisable after receipt of such written notice and prior to the
effective date of such transaction.
9. EFFECTIVE DATE AND CONDITIONS SUBSEQUENT TO EFFECTIVE DATE.
The Plan shall become effective on the date designated by the
Board, and the Plan shall be null and void and of no effect if such condition
is not fulfilled, and in such event each Stock Option granted hereunder shall,
notwithstanding any of the preceding provisions of the Plan, be null and void
and of no effect. No grant or award shall be made under the Plan more than ten
(10) years from the effective date hereof; provided, however, that the Plan and
all Stock Options granted under the Plan prior to such date shall remain in
effect and subject to adjustment and amendment as herein provided until they
have been satisfied or terminated in accordance with the terms of the
respective grants or awards and the related agreements.
10. TERMINATION.
(a) Each Stock Option shall, unless sooner terminated
pursuant to Section 10(b) below, expire on the first
to occur of the date one day after the tenth
anniversary of the date of grant thereof or the
expiration date set forth in the applicable option
agreement.
(b) Each Stock Option shall expire on the date it is
determined or found by (i) a court or administrative
judge or (ii) the Board, that the Stock Option,
either upon its grant or exercise, has or will be in
violation of any law, rule or regulation.
11. MISCELLANEOUS.
(a) LEGAL AND OTHER REQUIREMENTS. The obligation of the
Company to sell and deliver Common Stock under the
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<PAGE> 8
Plan shall be subject to all applicable laws,
regulations, rules and approvals, including, but not
by way of limitation, the effectiveness of a
registration statement under the Securities Act of
1933 if deemed necessary or appropriate by the
Company. Certificates for shares of Common Stock
issued hereunder may bear such legend as the Board
shall deem appropriate.
(b) NO OBLIGATION TO EXERCISE OPTIONS. The granting of a
Stock Option shall impose no obligation upon an
optionee to exercise such Stock Option.
(c) TERMINATION AND AMENDMENT OF PLAN. The Board, without
further action on the part of the shareholders of the
Company, may from time to time alter, amend or
suspend the Plan or any Stock Option granted
hereunder or may at any time terminate the Plan,
except that, it may not (except to the extent
provided in Section 7 hereof): (i) change the total
number of shares of Common Stock available for grant
under the Plan; (ii) extend the duration of the Plan;
(iii) increase the maximum term of Stock Options; or
(iv) change the physician eligibility for Options to
be granted under the Plan. No action taken by the
Board under this Section may materially and adversely
affect any outstanding Stock Option without the
consent of the holder thereof.
(d) APPLICATION OF FUNDS. The proceeds received by the
Company from the sale of Common Stock pursuant to
Stock Options will be used for general corporate
purposes.
(e) WITHHOLDING TAXES. Upon the exercise of any Stock
Option, the Company shall have the right to require
the optionee to remit to the Company an amount
sufficient to satisfy any federal, state and local
withholding tax requirements prior to the delivery of
any certificate or certificates for shares of Common
Stock. Whenever under the Plan payments are to be
made by the Company in cash or by check, such
payments shall be net of any amounts sufficient to
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<PAGE> 9
satisfy all federal, state and local withholding tax
requirements.
(f) RIGHT TO TERMINATE MEDICAL STAFF PRIVILEGES. Nothing
in the Plan or any agreement entered into pursuant to
the Plan shall confer upon any qualified physician or
other optionee the right to continue on the medical
staff of the Company or any subsidiary or affect any
right which the Company or any subsidiary may have to
terminate the medical staff privileges of such
qualified physician or other optionee.
(g) RIGHTS AS A SHAREHOLDER. No optionee shall have any
right or privileges as a shareholder unless and until
certificates for shares of Common Stock are issued to
him or her.
(h) FAIR MARKET VALUE. Whenever the fair market value of
Common Stock is to be determined under the Plan as of
a given date, such fair market value shall be:
(i) If the Common Stock is traded on the
over-the-counter market, the average of
the mean between the bid and the asked
price for the Common Stock at the close
of trading for the ten (10) consecutive
trading days immediately preceding such
given date;
(ii) If the Common Stock is listed on a
national securities exchange, the
average of the closing prices of the
Common Stock on the Composite Tape for
the ten (10) consecutive trading days
immediately preceding such given date;
and
(iii) If the Common Stock is neither traded on
the over-the-counter market nor listed
on a national securities exchange, such
value as the Board, in good faith, shall
determine.
(i) NOTICES. Every direction, revocation or notice
authorized or required by the Plan shall be deemed
delivered to the Company (a) on the date it is
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<PAGE> 10
personally delivered to the Secretary of the Company
at its principal executive offices or (b) three
business days after it is sent by registered or
certified mail, postage prepaid, addressed to the
Secretary at such offices; and shall be deemed
delivered to an optionee (a) on the date it is
personally delivered to him or her or (b) three
business days after it is sent by registered or
certified mail, postage prepaid, addressed to him or
her at the last address shown for him or her on the
records of the Company.
(j) APPLICABLE LAW. All questions pertaining to the
validity, construction and administration of the Plan
and Stock Options granted hereunder shall be
determined in conformity with the laws of the State
of Texas.
(k) ELIMINATION OF FRACTIONAL SHARES. If under any
provision of the Plan which requires a computation of
the number of shares of Common Stock subject to a
Stock Option, the number so computed is not a whole
number of shares of Common Stock, such number of
shares of Common Stock shall be rounded down to the
next whole number.
(l) SHAREHOLDERS' AGREEMENT. Notwithstanding anything to
the contrary contained in the Plan, the Company shall
be under no obligation to sell or deliver Common
Stock under the Plan to an optionee unless such
optionee shall execute (i) the Shareholders'
Agreement dated effective in December 31, 1990, (ii)
the Selected Shareholders' Agreement dated May 27,
1992, and (iii) the Stockholders Agreement dated May
27, 1992 with respect to such Common Stock, copies of
which will be furnished Optionee reasonably prior to
any exercise.
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<PAGE> 11
This Plan, in accordance with Section 9, is effective as of the
approval of Board evidenced in the Preamble hereof.
CHAMPION HEALTHCARE CORPORATION
By:
-------------------------------
Its:
--------------------------
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<PAGE> 12
AMENDMENT NO. 1 TO CHAMPION HEALTHCARE CORPORATION
PHYSICIAN STOCK OPTION PLAN
This Amendment No. 1 to the Champion Healthcare Corporation Physician Stock
Option Plan is effective this 6th day of December, 1994, upon the execution
hereof by Champion Healthcare Corporation and the holders of options on the
date hereof whose signatures appear below.
PREAMBLE. Pursuant to authority granted by the Board of Directors of Champion
Healthcare Corporation on August 9, 1994, the hereinbelow described amendment
(the "Amendment") was adopted to the Physician Stock Option Plan (the "Plan").
This Amendment was approved by the shareholders on December 6, 1994, with an
effective date for all purposes as of the date set forth in the first paragraph
above.
AMENDMENT. Section 9 of the Plan is hereby amended so that Stock Options and
Stock Appreciation Rights will not expire upon the merger or consolidation of
the Company, and Section 9 is amended to read in its entirety as follows:
9. DISSOLUTION, MERGER AND CONSOLIDATION.
Except as otherwise provided in Section 6(c)(ii),
upon the dissolution or liquidation of the Company or upon a merger
or consolidation of the Company in which the Company is not the
surviving corporation and for which the plan or agreement of merger
or consolidation does not provide for assumption by the surviving
or consolidated corporation of Stock Options and/or Stock
Appreciation Rights granted hereunder, each Stock Option and Stock
Appreciation Right granted hereunder shall expire as of the
effective date of such dissolution or liquidation; provided,
however, that the Board shall give at least 30 days prior written
notice of such event to each optionee during which time he or she
shall have a right to exercise his or her (1) vested or (2) if
specifically provided in the option grant, vested and unvested,
wholly or partially unexercised Stock Option (without regard to
installment exercise limitations, if any) or Stock Appreciation
Right and, subject to prior expiration pursuant to Section 11(b) or
(c), each Stock Option and Stock Appreciation Right shall be
exercisable after receipt of such written notice and prior to the
effective date of such transaction. Any term or provision in this
Plan to the contrary notwithstanding, in the event of a merger or
consolidation of the Company in which the Company is not the
surviving corporation and for which the plan or agreement of merger
or consolidation does provide for assumption by the surviving or
consolidated corporation of Stock Options or Stock Appreciation
Rights granted hereunder, each Stock Option and Stock Appreciation
Right granted hereunder shall survive such merger or consolidation,
and shall become and remain an obligation of the surviving
corporation, and shall be adjusted according to the adjustment
provisions of Section 8 of the Plan.
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AGREEMENT OF EXISTING OPTION HOLDERS. The undersigned individual, a holder of
an option issued pursuant to the Plan, hereby consents and agrees to the
Amendment.
COUNTERPARTS. This Amendment may be executed in one or more counterparts, each
of which shall be considered an original and together shall constitute the one
and same document.
CHAMPION HEALTHCARE CORPORATION
By:
-------------------------------
James G. VanDevender,
Executive Vice-president
OPTION HOLDER
-------------------------------
Print Name:
--------------------
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EXHIBIT 4.11
CHAMPION HEALTHCARE CORPORATION
SENIOR EXECUTIVE STOCK OPTION PLAN NO. 4
PREAMBLE. The Board of Directors of Champion Healthcare Corporation adopted
the hereinbelow described Senior Executive Stock Option Plan No. 4 effective as
of January 5, 1994.
1. PURPOSE
The purpose of this Senior Executive Stock Option Plan No. 4 (the
"Plan") is to give the senior executive officers ("key executives") of Champion
Healthcare Corporation, a corporation (the "Company"), an opportunity to
acquire shares of the common stock of the Company, no par value ("Common
Stock"), to provide an incentive for key executives to continue to promote the
best interests of the Company and enhance its long-term performance, and to
provide an incentive for such key executives to remain with the Company.
2. ADMINISTRATION.
(a) BOARD OF DIRECTORS. The Plan shall be administered
by the Board of Directors of the Company (the
"Board"), which, to the extent it shall determine,
may delegate its powers with respect to the
administration of the Plan (except its powers under
Section 12(c)) to a committee of directors (the
"Committee") appointed by the Board and composed of
not less than two members of the Board. If the Board
chooses to appoint a Committee, references
hereinafter to the Board (except in Section 12(c))
shall be deemed to refer to the Committee.
Notwithstanding the preceding provisions of this
Section, no member of the Board may exercise
discretion with respect to, or participate in, the
administration of the Plan if, at any time within one
year prior to such exercise or participation, he or
she has received stock, stock options, stock
appreciation rights or any other derivative security
pursuant to the Plan or any other plan of the Company
or any affiliate thereof as to which any discretion
is exercised.
(b) POWERS. Within the limits of the express provisions
of the Plan, the Board shall determine: (i) the key
executives to whom awards hereunder shall be granted,
(ii) the time or times at which such awards shall be
granted, (iii) the form and amount of the awards, and
(iv) the limitations, restrictions and conditions
applicable to any such award. In making such
determinations, the Board may take into account the
nature of the services rendered by such executives,
or classes of executives, their present and potential
contributions to the Company's success and such other
factors as the Board in its discretion shall deem
relevant.
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(c) INTERPRETATIONS. Subject to the express provisions
of the Plan, the Board may interpret the Plan,
prescribe, amend and rescind rules and regulations
relating to it, determine the terms and provisions of
the respective awards and make all other
determinations it deems necessary or advisable for
the administration of the Plan.
(d) DETERMINATIONS. The determinations of the Board on
all matters regarding the Plan shall be conclusive. A
member of the Board shall only be liable for any
action taken or determination made in bad faith.
(e) NONUNIFORM DETERMINATIONS. The Board's
determinations under the Plan, including without
limitation, determinations as to the persons to
receive awards, the terms and provisions of such
awards and the agreements evidencing the same, need
not be uniform and may be made by it selectively
among persons who receive or are eligible to receive
awards under the Plan, whether or not such persons
are similarly situated.
3. AWARDS UNDER THE PLAN.
(a) TYPE OF AWARD. Awards under the Plan may be granted
in either or both of the following forms: (i)
Nonstatutory Stock Options, as described in Section
4, and (ii) Stock Appreciation Rights, as described
in Section 6. Nonstatutory Stock Options shall be
referred to herein as "Stock Options."
(b) MAXIMUM LIMITATIONS. The aggregate number of shares
of Common Stock available for grant under the Plan is
300,000, subject to adjustment pursuant to Section 8.
Shares of Common Stock issued pursuant to the Plan
may be either authorized but unissued shares or
shares now or hereafter held in the treasury of the
Company. In the event that, prior to the end of the
period during which Stock Options may be granted
under the Plan, any Stock Option under the Plan
expires unexercised or is terminated, surrendered or
cancelled (other than in connection with the exercise
of a Stock Appreciation Right) without being
exercised, in whole or in part, for any reason, the
number of shares theretofore subject to such Stock
Option or the unexercised, terminated, forfeited or
unearned portion thereof, shall be added to the
remaining number of shares of Common Stock available
for grant as a Stock Option under the Plan, including
a grant to a former holder of such Stock Option, upon
such terms and conditions as the Board shall
determine, which terms may be more or less favorable
than those applicable to such former Stock Option.
4. STOCK OPTIONS.
(a) CONDITIONS. Stock Options may be granted under the
Plan for the purchase of shares of Common Stock.
Stock Options shall be in such form and upon
Senior Executive Stock Option Plan Page 2
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such terms and conditions as the Board
shall from time to time determine,
subject to the following.
(i) OPTION PRICE. The option price of each
Stock Option to purchase Common Stock
shall be determined by the Board, but
shall not be less than 80% of the fair
market value of the Common Stock subject
to such Stock Option on the date of
grant or $9.00, whichever is greater.
(ii) TERM OF OPTIONS. No Stock Option shall
be exercisable after the date ten (10)
years and one (1) day from the date such
Stock Option is granted.
(iii) CONDITIONS OF GRANT. The Board, in its
discretion, may, as a condition to the
grant of a Stock Option, require a key
executive who is the recipient of such
Stock Option to enter into one or more
of the following agreements with the
Company on or prior to the date of grant
of such Option:
a) A covenant not to compete with
the Company and its
subsidiaries which shall
become effective on the date
of termination of employment
of the key executive with the
Company and which shall
contain such terms and
conditions as shall be
specified by the Board;
b) An agreement to cancel any
employment agreement, fringe
benefit or compensation
arrangement in effect between
the Company and the key
executive.
c) The D Stockholders Agreement
dated effective December 31,
1993 among the Company and
Company Shareholders set forth
in Schedule I to that
agreement.
If the key executive shall fail to enter into any such agreement at the request
of the Board, then no Stock Option shall be granted hereunder to such key
executive and the number of shares of Common Stock which would have been
subject to such Option shall be added to the remaining number of shares of
Common Stock available for grant as a Stock Option under the Plan.
(b) FORM. The form of the stock option agreement shall
subject to paragraph (a) immediately above, be
substantially in the form as Exhibit 1 hereto.
Senior Executive Stock Option Plan Page 3
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5. PROVISIONS APPLICABLE TO STOCK OPTIONS.
(a) EXERCISE. Stock Options shall be subject to such terms
and conditions, shall be exercisable at such time or
times, and shall be evidenced by such form of written
option agreement between the optionee and the Company,
as the Board shall determine; provided, that such
determinations are not inconsistent with the other
provisions of the Plan.
(b) MANNER OF EXERCISE OF OPTIONS AND PAYMENT FOR COMMON
STOCK. Stock Options may be exercised by an optionee
by giving written notice to the Secretary of the
Company stating the number of shares of Common Stock
with respect to which the Stock Option is being
exercised and tendering payment therefor. At the time
that a Stock Option granted under the Plan, or any part
thereof, is exercised, payment for the Common Stock
issuable thereupon shall be made in full in cash or by
certified check or, if the Board in its discretion
agrees to accept, in shares of Common Stock of the
Company (the number of such shares paid for each share
subject to the Stock Option, or part thereof, being
exercised shall be determined by dividing the option
price by the fair market value per share of the Common
Stock on the date of exercise). As soon as reasonably
possible following such exercise, a certificate
representing shares of Common Stock purchased,
registered in the name of the optionee, shall be
delivered to the optionee.
(c) CANCELLATION OF STOCK APPRECIATION RIGHTS. The
exercise of any Stock Option shall cancel that number,
if any, of Stock Appreciation Rights (as defined in
Section 6) included in such Stock Option, which is
equal to the excess of (i) the number of shares of
Common Stock subject to Stock Appreciation Rights
included in such Stock Option, over (ii) the number
of shares of Common Stock which remain subject to
such Stock Option after such exercise.
6. STOCK APPRECIATION RIGHTS.
(a) AWARD. If deemed by the Board to be in the best
interest of the Company, any Stock Option granted under
the Plan may include a stock appreciation right ("Stock
Appreciation Right"), either at the time of grant or
thereafter while the Stock Option is outstanding.
(b) TERMS OF RIGHTS. Stock Appreciation Rights shall be
subject to such terms and conditions not inconsistent
with the other provisions of the Plan as the Board
shall determine; provided that:
Senior Executive Stock Option Plan Page 4
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(i) LIMITATIONS. A Stock Appreciation Right
shall be exercisable to the extent, and
only to the extent, the Stock Option in
which it is included is exercisable and
shall be exercisable only for such
period as the Board may determine (which
period may expire prior to the
expiration date of such Stock Option).
(ii) SURRENDER OR EXCHANGE. A Stock
Appreciation Right shall entitle the
optionee to surrender to the Company
unexercised the Stock Option, or portion
thereof, to which it is related, or any
portion thereof, and to receive from the
Company in exchange therefor that number
of shares of Common Stock having an
aggregate fair market value equal to the
excess of the fair market value on the
date of exercise of one share of Common
Stock over the option price per share
specified in such Stock Option, multiplied
by the number of shares of Common Stock
subject to the Stock Option, or portion
thereof, which is so surrendered. The
Board shall be entitled to elect to settle
any part or all of the Company's
obligation arising out of the exercise of
a Stock Appreciation Right by the payment
to the optionee of cash or by check equal
to the aggregate fair market value on the
date on which the Stock Appreciation Right
is exercised of that part or all of the
shares of Common Stock the Company would
otherwise be obligated to deliver.
(c) CASH SETTLEMENT RESTRICTIONS.
(i) Notwithstanding Sections 6(b) and 9
hereof, so long as the grantee of a Stock
Appreciation Right is an officer, an owner
of 10% or more of an equity security of
the Company that is registered under the
Securities Exchange Act of 1934, or a
director of the Company, the Company's
right to elect to settle any part or all
of its obligation arising out of the
exercise of a Stock Appreciation Right by
the payment of cash or by check shall not
apply unless such exercise occurs either:
(1) pursuant to the provisions of
subsection (ii) below, or (2) during the
period beginning on the third business day
following the date of release by the
Company for publication of its quarterly
or annual summary statements of sales and
earnings and ending on the twelfth
business day following such date.
(ii) In the event that, pursuant to Section 9,
the Company shall cancel all unexercised
Stock Options as of the effective date of
a merger or other transaction provided
therein or in the case of dissolution of
the Company, then each Stock Appreciation
Senior Executive Stock Option Plan Page 5
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Right held by an officer, an owner of 10%
or more of an equity security of the
Company that is registered under the
Securities Exchange Act of 1934, or a
director of the Company, shall be
automatically exercised on such date
within 30 days prior to the effective date
of such transaction or dissolution as the
Board shall determine and, in the absence
of such determination, on the last
business day immediately prior to such
effective date.
7. TRANSFERABILITY.
No Stock Option or Stock Appreciation Right may be transferred,
assigned, pledged or hypothecated (whether by operation of law or otherwise),
except as provided by will or the applicable laws of descent or distribution,
and no Stock Option or Stock Appreciation Right shall be subject to execution,
attachment or similar process. Any attempted assignment, transfer, pledge,
hypothecation or other disposition of a Stock Option or Stock Appreciation
Right, or levy of attachment or similar process upon the Stock Option or Stock
Appreciation Right not specifically permitted herein shall be null and void and
without effect. A Stock Option or Stock Appreciation Right may be exercised
only by a key executive during his or her lifetime, or pursuant to Section 11
(c), by his or her estate or the person who acquires the right to exercise such
Stock Option or Stock Appreciation Right upon his or her death by bequest or
inheritance.
8. ADJUSTMENT PROVISIONS.
The aggregate number of shares of Common Stock with respect to
which Stock Options and Stock Appreciation Rights may be granted, the aggregate
number of shares of Common Stock subject to each outstanding Stock Option and
Stock Appreciation Right, and the option price per share of each such Stock
Option, may all be appropriately adjusted as the Board may determine for any
increase or decrease in the number of shares of issued Common Stock resulting
from a subdivision or consolidation of shares, whether through reorganization,
recapitalization, stock split-up, stock distribution or combination of shares,
or the payment of a share dividend or other increase or decrease in the number
of such shares outstanding effected without receipt of consideration by the
Company. Adjustments under this Section 8 shall be made according to the sole
discretion of the Board, and its decisions shall be binding and conclusive.
9. DISSOLUTION, MERGER AND CONSOLIDATION.
Except as otherwise provided in Section 6(c)(ii), upon the
dissolution or liquidation of the Company, or upon a merger or consolidation of
the Company in which the Company is not the surviving corporation, each Stock
Option and Stock Appreciation Right granted hereunder shall expire as of the
effective date of such transaction; provided, however, that the Board shall
give at least 30 days prior written notice of such event to each optionee
during which time he or she shall have a right to exercise his or her (1)
vested or (2) if specifically provided in the option grant, vested and not
vested, wholly or partially unexercised Stock Option (without regard to
installment exercise limitations, if any) or Stock Appreciation Right and,
subject to prior
Senior Executive Stock Option Plan Page 6
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expiration pursuant to section 11(b) or (c), each Stock Option and Stock
Appreciation Right shall be exercisable after receipt of such written notice
and prior to the effective date of such transaction.
10. EFFECTIVE DATE AND CONDITIONS SUBSEQUENT TO EFFECTIVE DATE.
The Plan shall become effective on the date established by the
Board of Directors. No grant or award shall be made under the Plan more than
ten (10) years from the date of adoption hereof; provided, however, that the
Plan and all Stock Options and Stock Appreciation Rights granted under the Plan
prior to such date shall remain in effect and subject to adjustment and
amendment as herein provided until they have been satisfied or terminated in
accordance with the terms of the respective grants or awards and the related
agreements.
11. TERMINATION OF EMPLOYMENT.
(a) Each Stock Option and Stock Appreciation Right shall,
unless sooner expired pursuant to Section 11 (b) or
(c) below, expire on the first to occur of the date
one day after the tenth anniversary of the date of
grant thereof or the expiration date set forth in the
applicable option agreement.
(b) A Stock Option and Stock Appreciation Right shall
expire on the first to occur of the applicable date
set forth in paragraph (a) next above and the date
that the employment of the key executive with the
Company and all subsidiaries terminates for any
reason other than death or disability. Upon receipt
of notice of termination of employment, whether
written or oral, Optionee shall not thereafter have
the right to exercise the Stock Option or Stock
Appreciation Rights. Notwithstanding the preceding
provisions of this paragraph, the Board, in its sole
discretion, may, by written notice given to a former
employee, permit the former employee to exercise
Stock Options or Stock Appreciation Rights during a
period following his or her termination of
employment, which period shall not exceed ninety (90)
days. In no event, however, may the Board permit a
former employee to exercise a Stock Option or Stock
Appreciation Right after the expiration date
contained in the agreement evidencing such Stock
Option or Stock Appreciation Right. Notwithstanding
the preceding provisions of this paragraph, if the
Board permits a former employee to exercise Stock
Options or Stock Appreciation Rights during a period
following his or her termination of employment
pursuant to such preceding provisions, such Stock
Options or Stock Appreciation Rights shall, to the
extent unexercised, expire on the date that such
former employee violates (as determined by the Board)
any covenant not to compete in effect between the
Company and/or its subsidiaries and the former
employee.
(c) If the employment of a key executive with the Company
and all subsidiaries terminates by reason of
disability (as determined by the Board) or by reason
Senior Executive Stock Option Plan Page 7
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of death, his or her Stock Options and Stock
Appreciation Rights, if any, shall expire on the
first to occur of the date set forth in paragraph (a)
of this Section 11 or the first anniversary of such
termination of employment.
Senior Executive Stock Option Plan Page 8
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12. MISCELLANEOUS.
(a) LEGAL AND OTHER REQUIREMENTS. The obligation of the
Company to sell and deliver Common Stock under the
Plan shall be subject to all applicable laws,
regulations, rules and approvals, including, but not
by way of limitation, the effectiveness of a
registration statement under the Securities Act of
1933 if deemed necessary or appropriate by the
Company. Certificates for shares of Common Stock
issued hereunder may bear such legend as the Board
shall deem appropriate.
(b) NO OBLIGATION TO EXERCISE OPTIONS. The granting of a
Stock Option shall impose no obligation upon an
optionee to exercise such Stock Option.
(c) TERMINATION AND AMENDMENT OF PLAN. The Board, without
further action on the part of the shareholders of the
Company, may from time to time alter, amend or
suspend the Plan or any Stock Option or Stock
Appreciation Right granted hereunder or may at any
time terminate the Plan, except that, it may not
(except to the extent provided in Section 8 hereof):
(i) change the total number of shares of Common Stock
available for grant under the Plan; (ii) extend the
duration of the Plan; (iii) increase the maximum term
of Stock Options; or (iv) change the class of
employees eligible to be granted Stock Options or
Stock Appreciation Rights under the Plan. No action
taken by the Board under this Section may materially
and adversely affect any outstanding Stock Option or
Stock Appreciation Right without the consent of the
holder thereof.
(d) APPLICATION OF FUNDS. The proceeds received by the
Company from the sale of Common Stock pursuant to
Stock Options will be used for general corporate
purposes.
(e) WITHHOLDING TAXES. Upon the exercise of any Stock
Option or Stock Appreciation Right, the Company shall
have the right to require the optionee to remit to
the Company an amount sufficient to satisfy an
federal, state and local withholding tax requirements
prior to the delivery of any certificate or
certificates for shares of Common Stock. Whenever
under the Plan payments are to be made by the Company
in cash or by check, such payments shall be net of
any amounts sufficient to satisfy all federal, state
and local withholding tax requirements.
(f) RIGHT TO TERMINATE EMPLOYMENT. Nothing in the Plan
or any agreement entered into pursuant to the Plan
shall confer upon any key executive or other optionee
the right to continue in the employment of the
Company or any subsidiary or affect any right which
the Company or any subsidiary may have to terminate
the employment of such key executive or other
optionee.
Senior Executive Stock Option Plan Page 9
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(g) RIGHTS AS A SHAREHOLDER. No optionee shall have any
right or privileges as a shareholder unless and until
certificates for shares of Common Stock are issued to
him or her.
(h) LEAVES OF ABSENCE AND DISABILITY. The Board shall be
entitled to make such rules, regulations and
determinations as it deems appropriate under the Plan
in respect of any leave of absence taken by or
disability of any key executive. Without limiting the
generality of the foregoing, the Board shall be
entitled to determine (i) whether or not any such
leaves of absence shall constitute a termination of
employment within the meaning of the Plan, and (ii)
the impact, if any, of any such leave of absence on
awards under the Plan theretofore made to any key
executive who takes such leave of absence.
(i) FAIR MARKET VALUE. Whenever the fair market value of
Common Stock is to be determined under the Plan as of
a given date, such fair market value shall be:
(i) If the Common Stock is traded on the
over-the-counter market, the average of
the mean between the bid and the asked
price for the Common Stock at the close
of trading for the ten (10) consecutive
trading days immediately preceding such
given date;
(ii) If the Common Stock is listed on a
national securities exchange, the
average of the closing prices of the
Common Stock on the Composite Tape for
the ten (10) consecutive trading days
immediately preceding such given date;
and
(iii) If the Common Stock is neither traded on
the over-the-counter market nor listed
on a national securities exchange, such
value as the Board, in good faith, shall
determine.
(j) NOTICES. Every direction, revocation or notice
authorized or required by the Plan shall be deemed
delivered to the Company (a) on the date it is
personally delivered to the Secretary of the Company
at its principal executive offices or (b) three
business days after it is sent by registered or
certified mail, postage prepaid, addressed to the
Secretary at such offices; and shall be deemed
delivered to an optionee (a) on the date it is
personally delivered to him or her or (b) three
business days after it is sent by registered or
certified mail, postage prepaid, addressed to him or
her at the last address shown for him or her on the
records of the Company.
(k) APPLICABLE LAW. All questions pertaining to the
validity, construction and administration of the Plan
and Stock Options and Stock Appreciation Rights
Senior Executive Stock Option Plan Page 10
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granted hereunder shall be determined in conformity
with the laws of the State of Texas.
(l) ELIMINATION OF FRACTIONAL SHARES. If under any
provision of the Plan which requires a computation of
the number of shares of Common Stock subject to a
Stock Option or Stock Appreciation Right, the number
so computed is not a whole number of shares of Common
Stock, such number of shares of Common Stock shall be
rounded down to the next whole number.
(m) D STOCKHOLDERS AGREEMENT. Notwithstanding anything
to the contrary contained in the Plan, the Company
shall be under no obligation to sell or deliver
Common Stock under the Plan to an optionee unless
such optionee shall execute (i) the D Stockholders
Agreement dated effective in December 31, 1993 with
respect to such Common Stock, a copy of which will be
furnished Optionee reasonably prior to any exercise.
This Plan, in accordance with Section 10, is effective as of the
date evidenced in the Preamble hereof.
CHAMPION HEALTHCARE CORPORATION
By:
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Its:
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<PAGE> 12
AMENDMENT NO. 1 TO CHAMPION HEALTHCARE CORPORATION
SENIOR EXECUTIVE STOCK OPTION PLAN NO. 4
This Amendment No. 1 to the Champion Healthcare Corporation Senior Executive
Stock Option Plan No. 4 is effective this 6th day of December, 1994, upon the
execution hereof by Champion Healthcare Corporation and the holders of options
on the date hereof whose signatures appear below.
PREAMBLE. Pursuant to authority granted by the Board of Directors of Champion
Healthcare Corporation on August 9, 1994, the hereinbelow described amendment
(the "Amendment") was adopted to the Senior Executive Stock Option Plan No. 4
(the "Plan"). This Amendment was approved by the shareholders on December 9,
1994, with an effective date for all purposes as of the date set forth in the
first paragraph above.
AMENDMENT. Section 9 of the Plan is hereby amended so that Stock Options and
Stock Appreciation Rights will not expire upon the merger or consolidation of
the Company, and Section 9 is amended to read in its entirety as follows:
9. DISSOLUTION, MERGER AND CONSOLIDATION.
Except as otherwise provided in Section 6(c)(ii),
upon the dissolution or liquidation of the Company or upon a merger
or consolidation of the Company in which the Company is not the
surviving corporation and for which the plan or agreement of merger
or consolidation does not provide for assumption by the surviving
or consolidated corporation of Stock Options and/or Stock
Appreciation Rights granted hereunder, each Stock Option and Stock
Appreciation Right granted hereunder shall expire as of the
effective date of such dissolution or liquidation; provided,
however, that the Board shall give at least 30 days prior written
notice of such event to each optionee during which time he or she
shall have a right to exercise his or her (1) vested or (2) if
specifically provided in the option grant, vested and unvested,
wholly or partially unexercised Stock Option (without regard to
installment exercise limitations, if any) or Stock Appreciation
Right and, subject to prior expiration pursuant to Section 11(b) or
(c), each Stock Option and Stock Appreciation Right shall be
exercisable after receipt of such written notice and prior to the
effective date of such transaction. Any term or provision in this
Plan to the contrary notwithstanding, in the event of a merger or
consolidation of the Company in which the Company is not the
surviving corporation and for which the plan or agreement of merger
or consolidation does provide for assumption by the surviving or
consolidated corporation of Stock Options or Stock Appreciation
Rights granted hereunder, each Stock Option and Stock Appreciation
Right granted hereunder shall survive such merger or consolidation,
and shall become and remain an obligation of the surviving
corporation, and shall be adjusted according to the adjustment
provisions of Section 8 of the Plan.
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AGREEMENT OF EXISTING OPTION HOLDERS. The undersigned individual, a holder of
an option issued pursuant to the Plan, hereby consents and agrees to the
Amendment.
COUNTERPARTS. This Amendment may be executed in one or more counterparts, each
of which shall be considered an original and together shall constitute the one
and same document.
CHAMPION HEALTHCARE CORPORATION
By:
--------------------------------
James G. VanDevender,
Executive Vice-president
OPTION HOLDER
--------------------------------
Print Name:
---------------------
OPTION HOLDER
--------------------------------
Print Name:
---------------------
OPTION HOLDER
--------------------------------
Print Name:
---------------------
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<PAGE> 1
EXHIBIT 4.12
CHAMPION HEALTHCARE CORPORATION
SELECTED EXECUTIVE STOCK OPTION PLAN NO. 5
PREAMBLE. The Board of Directors of Champion Healthcare Corporation adopted
the hereinbelow described Selected Executive Stock Option Plan No. 5 effective
as of May 25, 1995 and it was approved by the shareholders on __________, 1995.
1. PURPOSE
The purpose of this Selected Executive Stock Option Plan No. 5 (the
"Plan") is to give the Selected Executive officers ("key executives") of
Champion Healthcare Corporation, a Delaware corporation (the "Company"), an
opportunity to acquire shares of the common stock of the Company, $.01 par
value ("Common Stock"), to provide an incentive for selected executives to
continue to promote the best interests of the Company and enhance its long-term
performance, and to provide an incentive for such selected executives to remain
with the Company.
2. ADMINISTRATION.
(a) BOARD OF DIRECTORS. The Plan shall be administered
by the Board of Directors of the Company (the
"Board"), which, to the extent it shall determine,
may delegate its powers with respect to the
administration of the Plan (except its powers under
Section 12(c)) to a committee of directors (the
"Committee") appointed by the Board and composed of
not less than two members of the Board. If the Board
chooses to appoint a Committee, references
hereinafter to the Board (except in Section 12(c))
shall be deemed to refer to the Committee.
Notwithstanding the preceding provisions of this
Section, no member of the Board may exercise
discretion with respect to, or participate in, the
administration of the Plan if, at any time within one
year prior to such exercise or participation, he or
she has received stock, stock options, stock
appreciation rights or any other derivative security
pursuant to the Plan or any other plan of the Company
or any affiliate thereof as to which any discretion
is exercised.
(b) POWERS. Within the limits of the express provisions
of the Plan, the Board shall determine: (i) the
selected executives to whom awards hereunder shall be
granted, (ii) the time or times at which such awards
shall be granted, (iii) the form and amount of the
awards, and (iv) the limitations, restrictions and
conditions applicable to any such award. In making
such determinations, the Board may take into account
the nature of the services rendered by such
executives, or classes of executives, their present
and potential contributions to the Company's success
and such other factors as the Board in its discretion
shall deem relevant.
(c) INTERPRETATIONS. Subject to the express provisions
of the Plan, the Board may interpret the Plan,
prescribe, amend and rescind rules and regulations
relating to it, determine the terms and provisions of
the respective awards and make all other
determinations it deems necessary or advisable for
the administration of the Plan.
(d) DETERMINATIONS. The determinations of the Board on
all matters regarding the Plan shall be conclusive. A
member of the Board shall only be liable for any
action taken or determination made in bad faith.
(e) NONUNIFORM DETERMINATIONS. The Board's
determinations under the Plan, including without
limitation, determinations as to the persons to
receive awards, the terms and
Selected Executive Stock Option Plan Page 1
<PAGE> 2
provisions of such awards and the agreements
evidencing the same, need not be uniform and may be
made by it selectively among persons who receive or
are eligible to receive awards under the Plan,
whether or not such persons are similarly situated.
3. AWARDS UNDER THE PLAN.
(a) TYPE OF AWARD. Awards under the Plan may be granted
in either or both of the following forms: (i)
Nonstatutory Stock Options, as described in Section
4, and (ii) Stock Appreciation Rights, as described
in Section 6. Nonstatutory Stock Options shall be
referred to herein as "Stock Options."
(b) MAXIMUM LIMITATIONS. The aggregate number of shares
of Common Stock available for grant under the Plan is
144,500, subject to adjustment pursuant to Section 8.
Shares of Common Stock issued pursuant to the Plan
may be either authorized but unissued shares or
shares now or hereafter held in the treasury of the
Company. In the event that, prior to the end of the
period during which Stock Options may be granted
under the Plan, any Stock Option under the Plan
expires unexercised or is terminated, surrendered or
canceled (other than in connection with the exercise
of a Stock Appreciation Right) without being
exercised, in whole or in part, for any reason, the
number of shares theretofore subject to such Stock
Option or the unexercised, terminated, forfeited or
unearned portion thereof, shall be added to the
remaining number of shares of Common Stock available
for grant as a Stock Option under the Plan, including
a grant to a former holder of such Stock Option, upon
such terms and conditions as the Board shall
determine, which terms may be more or less favorable
than those applicable to such former Stock Option.
4. STOCK OPTIONS.
(a) CONDITIONS. Stock Options may be granted under the
Plan for the purchase of shares of Common Stock.
Stock Options shall be in such form and upon such
terms and conditions as the Board shall from time to
time determine, subject to the following.
(i) OPTION PRICE. The option price of each
Stock Option to purchase Common Stock
shall be determined by the Board, but
shall not be less than 80% of the fair
market value of the Common Stock subject
to such Stock Option on the date of
grant or $9.00, whichever is greater.
(ii) TERM OF OPTIONS. No Stock Option shall
be exercisable after the date ten (10)
years and one (1) day from the date such
Stock Option is granted.
(iii) CONDITIONS OF GRANT. The Board, in its
discretion, may, as a condition to the
grant of a Stock Option, require a
selected executive who is the recipient
of such Stock Option to enter into one
or more of the following agreements with
the Company on or prior to the date of
grant of such Option:
a) A covenant not to compete with
the Company and its
subsidiaries which shall
become effective on the date
of termination of employment
of the selected executive with
the Company and which shall
contain such terms and
conditions as shall be
specified by the Board;
Selected Executive Stock Option Plan Page 2
<PAGE> 3
b) An agreement to cancel any
employment agreement, fringe
benefit or compensation
arrangement in effect between
the Company and the selected
executive.
c) The D Stockholders Agreement
dated effective December 31,
1993 as amended, among the
Company and Company
Shareholders set forth in
Schedule I to that agreement.
If the selected executive shall fail to enter into any such agreement at the
request of the Board, then no Stock Option shall be granted hereunder to such
selected executive and the number of shares of Common Stock which would have
been subject to such Option shall be added to the remaining number of shares of
Common Stock available for grant as a Stock Option under the Plan.
(b) FORM. The form of the stock option agreement shall
subject to paragraph (a) immediately above, be
substantially in the form as Exhibit 1 hereto.
5. PROVISIONS APPLICABLE TO STOCK OPTIONS.
(a) EXERCISE. Stock Options shall be subject to such
terms and conditions, shall be exercisable at such
time or times, and shall be evidenced by such form of
written option agreement between the optionee and the
Company, as the Board shall determine; provided, that
such determinations are not inconsistent with the
other provisions of the Plan.
(b) MANNER OF EXERCISE OF OPTIONS AND PAYMENT FOR COMMON
STOCK. Stock Options may be exercised by an optionee
by giving written notice to the Secretary of the
Company stating the number of shares of Common Stock
with respect to which the Stock Option is being
exercised and tendering payment therefor. At the time
that a Stock Option granted under the Plan, or any
part thereof, is exercised, payment for the Common
Stock issuable thereupon shall be made in full in
cash or by certified check or, if the Board in its
discretion agrees to accept, in shares of Common
Stock of the Company (the number of such shares paid
for each share subject to the Stock Option, or part
thereof, being exercised shall be determined by
dividing the option price by the fair market value
per share of the Common Stock on the date of
exercise). As soon as reasonably possible following
such exercise, a certificate representing shares of
Common Stock purchased, registered in the name of the
optionee, shall be delivered to the optionee.
(c) CANCELLATION OF STOCK APPRECIATION RIGHTS. The
exercise of any Stock Option shall cancel that
number, if any, of Stock Appreciation Rights (as
defined in Section 6) included in such Stock Option,
which is equal to the excess of (i) the number of
shares of Common Stock subject to Stock Appreciation
Rights included in such Stock Option, over (ii) the
number of shares of Common Stock which remain subject
to such Stock Option after such exercise.
6. STOCK APPRECIATION RIGHTS.
(a) AWARD. If deemed by the Board to be in the best
interest of the Company, any Stock Option granted
under the Plan may include a stock appreciation right
("Stock Appreciation Right"), either at the time of
grant or thereafter while the Stock Option is
outstanding.
(b) TERMS OF RIGHTS. Stock Appreciation Rights shall be
subject to such terms and conditions not inconsistent
with the other provisions of the Plan as the Board
shall determine; provided that:
Selected Executive Stock Option Plan Page 3
<PAGE> 4
(i) LIMITATIONS. A Stock Appreciation Right
shall be exercisable to the extent, and
only to the extent, the Stock Option in
which it is included is exercisable and
shall be exercisable only for such
period as the Board may determine (which
period may expire prior to the
expiration date of such Stock Option).
(ii) SURRENDER OR EXCHANGE. A Stock
Appreciation Right shall entitle the
optionee to surrender to the Company
unexercised the Stock Option, or portion
thereof, to which it is related, or any
portion thereof, and to receive from the
Company in exchange therefor that number
of shares of Common Stock having an
aggregate fair market value equal to the
excess of the fair market value on the
date of exercise of one share of Common
Stock over the option price per share
specified in such Stock Option,
multiplied by the number of shares of
Common Stock subject to the Stock
Option, or portion thereof, which is so
surrendered. The Board shall be entitled
to elect to settle any part or all of
the Company's obligation arising out of
the exercise of a Stock Appreciation
Right by the payment to the optionee of
cash or by check equal to the aggregate
fair market value on the date on which
the Stock Appreciation Right is
exercised of that part or all of the
shares of Common Stock the Company would
otherwise be obligated to deliver.
(c) CASH SETTLEMENT RESTRICTIONS.
(i) Notwithstanding Sections 6(b) and 9
hereof, so long as the grantee of a
Stock Appreciation Right is an officer,
an owner of 10% or more of an equity
security of the Company that is
registered under the Securities Exchange
Act of 1934, or a director of the
Company, the Company's right to elect to
settle any part or all of its obligation
arising out of the exercise of a Stock
Appreciation Right by the payment of
cash or by check shall not apply unless
such exercise occurs either: (1)
pursuant to the provisions of subsection
(ii) below, or (2) during the period
beginning on the third business day
following the date of release by the
Company for publication of its quarterly
or annual summary statements of sales
and earnings and ending on the twelfth
business day following such date.
(ii) In the event that, pursuant to Section
9, the Company shall cancel all
unexercised Stock Options as of the
effective date of a merger or other
transaction provided therein or in the
case of dissolution of the Company, then
each Stock Appreciation Right held by an
officer, an owner of 10% or more of an
equity security of the Company that is
registered under the Securities Exchange
Act of 1934, or a director of the
Company, shall be automatically
exercised on such date within 30 days
prior to the effective date of such
transaction or dissolution as the Board
shall determine and, in the absence of
such determination, on the last business
day immediately prior to such effective
date.
7. TRANSFERABILITY.
No Stock Option or Stock Appreciation Right may be transferred,
assigned, pledged or hypothecated (whether by operation of law or otherwise),
except as provided by will or the applicable laws of descent or distribution,
and no Stock Option or Stock Appreciation Right shall be subject to execution,
attachment or similar process. Any attempted assignment, transfer, pledge,
hypothecation or other disposition of a Stock Option or Stock Appreciation
Right, or levy of attachment or similar process upon the Stock Option or Stock
Appreciation Right not specifically permitted herein shall be null and void and
without effect. A Stock Option or Stock Appreciation Right may be exercised
only by a selected executive during his or her lifetime, or pursuant to Section
11 (c), by his or
Selected Executive Stock Option Plan Page 4
<PAGE> 5
her estate or the person who acquires the right to exercise such Stock Option
or Stock Appreciation Right upon his or her death by bequest or inheritance.
8. ADJUSTMENT PROVISIONS.
The aggregate number of shares of Common Stock with respect to
which Stock Options and Stock Appreciation Rights may be granted, the aggregate
number of shares of Common Stock subject to each outstanding Stock Option and
Stock Appreciation Right, and the option price per share of each such Stock
Option, may all be appropriately adjusted as the Board may determine for any
increase or decrease in the number of shares of issued Common Stock resulting
from a subdivision or consolidation of shares, whether through reorganization,
recapitalization, stock split-up, stock distribution or combination of shares,
or the payment of a share dividend or other increase or decrease in the number
of such shares outstanding effected without receipt of consideration by the
Company. Adjustments under this Section 8 shall be made according to the sole
discretion of the Board, and its decisions shall be binding and conclusive.
9. DISSOLUTION, MERGER AND CONSOLIDATION.
Except as otherwise provided in Section 6(c)(ii), upon the
dissolution or liquidation of the Company, or upon a merger or consolidation of
the Company in which the Company is not the surviving corporation, each Stock
Option and Stock Appreciation Right granted hereunder shall expire as of the
effective date of such transaction; provided, however, that the Board shall
give at least 30 days prior written notice of such event to each optionee
during which time he or she shall have a right to exercise his or her (1)
vested or (2) if specifically provided in the option grant, vested and not
vested, wholly or partially unexercised Stock Option (without regard to
installment exercise limitations, if any) or Stock Appreciation Right and,
subject to prior expiration pursuant to Section 11(b) or (c), each Stock Option
and Stock Appreciation Right shall be exercisable after receipt of such written
notice and prior to the effective date of such transaction.
10. EFFECTIVE DATE AND CONDITIONS SUBSEQUENT TO EFFECTIVE DATE.
The Plan shall become effective on the date established by the
Board of Directors. No grant or award shall be made under the Plan more than
ten (10) years from the date of adoption hereof; provided, however, that the
Plan and all Stock Options and Stock Appreciation Rights granted under the Plan
prior to such date shall remain in effect and subject to adjustment and
amendment as herein provided until they have been satisfied or terminated in
accordance with the terms of the respective grants or awards and the related
agreements.
11. TERMINATION OF EMPLOYMENT.
(a) Each Stock Option and Stock Appreciation Right shall,
unless sooner expired pursuant to Section 11 (b) or
(c) below, expire on the first to occur of the date
one day after the tenth anniversary of the date of
grant thereof or the expiration date set forth in the
applicable option agreement.
(b) A Stock Option and Stock Appreciation Right shall
expire on the first to occur of the applicable date
set forth in paragraph (a) next above and the date
that the employment of the selected executive with
the Company and all subsidiaries terminates for any
reason other than death or disability. Upon receipt
of notice of termination of employment, whether
written or oral, Optionee shall not thereafter have
the right to exercise the Stock Option or Stock
Appreciation Rights. Notwithstanding the preceding
provisions of this paragraph, the Board, in its sole
discretion, may, by written notice given to a former
employee, permit the former employee to exercise
Stock Options or Stock Appreciation Rights during a
period following his or her termination of
employment, which period shall not exceed ninety (90)
days. In no event, however, may the Board permit a
former employee to exercise a Stock Option or Stock
Appreciation Right after the expiration date
contained in the agreement evidencing such Stock
Option or Stock Appreciation Right. Notwithstanding
the preceding provisions of this paragraph, if the
Board permits a former
Selected Executive Stock Option Plan Page 5
<PAGE> 6
employee to exercise Stock Options or Stock
Appreciation Rights during a period following his or
her termination of employment pursuant to such
preceding provisions, such Stock Options or Stock
Appreciation Rights shall, to the extent unexercised,
expire on the date that such former employee violates
(as determined by the Board) any covenant not to
compete in effect between the Company and/or its
subsidiaries and the former employee.
(c) If the employment of a selected executive with the
Company and all subsidiaries terminates by reason of
disability (as determined by the Board) or by reason
of death, his or her Stock Options and Stock
Appreciation Rights, if any, shall expire on the
first to occur of the date set forth in paragraph (a)
of this Section 11 or the first anniversary of such
termination of employment.
12. MISCELLANEOUS.
(a) LEGAL AND OTHER REQUIREMENTS. The obligation of the
Company to sell and deliver Common Stock under the
Plan shall be subject to all applicable laws,
regulations, rules and approvals, including, but not
by way of limitation, the effectiveness of a
registration statement under the Securities Act of
1933 if deemed necessary or appropriate by the
Company. Certificates for shares of Common Stock
issued hereunder may bear such legend as the Board
shall deem appropriate.
(b) NO OBLIGATION TO EXERCISE OPTIONS. The granting of a
Stock Option shall impose no obligation upon an
optionee to exercise such Stock Option.
(c) TERMINATION AND AMENDMENT OF PLAN. The Board, without
further action on the part of the shareholders of the
Company, may from time to time alter, amend or
suspend the Plan or any Stock Option or Stock
Appreciation Right granted hereunder or may at any
time terminate the Plan, except that, it may not
(except to the extent provided in Section 8 hereof):
(i) change the total number of shares of Common Stock
available for grant under the Plan; (ii) extend the
duration of the Plan; (iii) increase the maximum term
of Stock Options; or (iv) change the class of
employees eligible to be granted Stock Options or
Stock Appreciation Rights under the Plan. No action
taken by the Board under this Section may materially
and adversely affect any outstanding Stock Option or
Stock Appreciation Right without the consent of the
holder thereof.
(d) APPLICATION OF FUNDS. The proceeds received by the
Company from the sale of Common Stock pursuant to
Stock Options will be used for general corporate
purposes.
(e) WITHHOLDING TAXES. Upon the exercise of any Stock
Option or Stock Appreciation Right, the Company shall
have the right to require the optionee to remit to
the Company an amount sufficient to satisfy an
federal, state and local withholding tax requirements
prior to the delivery of any certificate or
certificates for shares of Common Stock. Whenever
under the Plan payments are to be made by the Company
in cash or by check, such payments shall be net of
any amounts sufficient to satisfy all federal, state
and local withholding tax requirements.
(f) RIGHT TO TERMINATE EMPLOYMENT. Nothing in the Plan
or any agreement entered into pursuant to the Plan
shall confer upon any selected executive or other
optionee the right to continue in the employment of
the Company or any subsidiary or affect any right
which the Company or any subsidiary may have to
terminate the employment of such selected executive
or other optionee.
Selected Executive Stock Option Plan Page 6
<PAGE> 7
(g) RIGHTS AS A SHAREHOLDER. No optionee shall have any
right or privileges as a shareholder unless and until
certificates for shares of Common Stock are issued to
him or her.
(h) LEAVES OF ABSENCE AND DISABILITY. The Board shall be
entitled to make such rules, regulations and
determinations as it deems appropriate under the Plan
in respect of any leave of absence taken by or
disability of any selected executive. Without
limiting the generality of the foregoing, the Board
shall be entitled to determine (i) whether or not any
such leaves of absence shall constitute a termination
of employment within the meaning of the Plan, and
(ii) the impact, if any, of any such leave of absence
on awards under the Plan theretofore made to any
selected executive who takes such leave of absence.
(i) FAIR MARKET VALUE. Whenever the fair market value of
Common Stock is to be determined under the Plan as of
a given date, such fair market value shall be:
(i) If the Common Stock is traded on the
over-the-counter market, the average of
the mean between the bid and the asked
price for the Common Stock at the close
of trading for the ten (10) consecutive
trading days immediately preceding such
given date;
(ii) If the Common Stock is listed on a
national securities exchange, the
average of the closing prices of the
Common Stock on the Composite Tape for
the ten (10) consecutive trading days
immediately preceding such given date;
and
(iii) If the Common Stock is neither traded on
the over-the-counter market nor listed
on a national securities exchange, such
value as the Board, in good faith, shall
determine.
(j) NOTICES. Every direction, revocation or notice
authorized or required by the Plan shall be deemed
delivered to the Company (a) on the date it is
personally delivered to the Secretary of the Company
at its principal executive offices or (b) three
business days after it is sent by registered or
certified mail, postage prepaid, addressed to the
Secretary at such offices; and shall be deemed
delivered to an optionee (a) on the date it is
personally delivered to him or her or (b) three
business days after it is sent by registered or
certified mail, postage prepaid, addressed to him or
her at the last address shown for him or her on the
records of the Company.
(k) APPLICABLE LAW. All questions pertaining to the
validity, construction and administration of the Plan
and Stock Options and Stock Appreciation Rights
granted hereunder shall be determined in conformity
with the laws of the State of Texas.
(l) ELIMINATION OF FRACTIONAL SHARES. If under any
provision of the Plan which requires a computation of
the number of shares of Common Stock subject to a
Stock Option or Stock Appreciation Right, the number
so computed is not a whole number of shares of Common
Stock, such number of shares of Common Stock shall be
rounded down to the next whole number.
(m) D STOCKHOLDERS AGREEMENT. Notwithstanding anything
to the contrary contained in the Plan, the Company
shall be under no obligation to sell or deliver
Common Stock under the Plan to an optionee unless
such optionee shall execute (i) the D Stockholders
Agreement dated effective in December 31, 1993 as
amended, with respect to such Common Stock, a copy of
which will be furnished Optionee reasonably prior to
any exercise.
Selected Executive Stock Option Plan Page 7
<PAGE> 8
This Plan, in accordance with Section 10, is effective as of the
date evidenced in the Preamble hereof.
CHAMPION HEALTHCARE CORPORATION
By:
--------------------------
Its:
--------------------------
Selected Executive Stock Option Plan Page 8
<PAGE> 9
CHAMPION HEALTHCARE CORPORATION
SELECTED EXECUTIVE
STOCK OPTION AGREEMENT
(STOCK OPTION ONLY)
A Stock Option ("Option") is hereby granted by Champion Healthcare
Corporation, a Texas corporation ("Company"), to the Selected Executive named
below ("Optionee"), for and with respect to common stock of the Company, $.01
par value per share ("Common Stock"), subject to the following terms and
conditions:
13. TERMS OF OPTION. Subject to the provisions set forth herein
and the terms and conditions of the Champion Healthcare Corporation Selected
Executive Stock Option Plan No. 5 ("Plan"), the terms of which are hereby
incorporated by reference, and in consideration of the agreements of Optionee
herein provided, the Company hereby grants to Optionee: an option to purchase
from the Company the number of shares of Common Stock, ("Shares") at the
purchase price per share, and with the terms, all as set forth below. At the
time of exercise of the Option, payment of the purchase price must be made in
cash, or if the committee ("Committee") of the Board of Directors of the
Company charged with the administration of the Plan in its discretion agrees to
so accept, then by the delivery to the Company of other Common Stock owned by
Optionee, valued at its fair market value on the date of exercise, or in some
combination of cash and such Common Stock so valued.
<TABLE>
<S> <C> <C>
Name of Optionee:
Address:
Social Security No.:
Number of Shares
Subject to Option:
--------------
Option Price Per Share: $
--------------
Value of Common Stock
at Date of Grant: $
-------------
Date of Grant:
--------------
Exercise Schedule:
</TABLE>
<TABLE>
<CAPTION>
Exercise Period
Number of Shares Commencement Expiration
<S> <C> <C>
------------------------- ---------------------- -------------------
------------------------- ---------------------- -------------------
------------------------- ---------------------- -------------------
</TABLE>
Accelerated Vesting: Upon notification by the Company of any event
provided for in Section 9 of the Plan, all options
not then vested as reflected in the Exercise Schedule
herein shall immediately vest.
14. EXERCISE. The exercise of the Option is conditioned upon
the acceptance by Optionee of the terms hereof as evidenced by his execution of
this agreement in the space provided therefor at the end hereof and the return
of an executed copy to the Secretary of the Company no later than
___________________.
If Optionee's employment with the Company and all subsidiaries
is terminated for any reason, other than for death or disability, the Option
shall expire on the earlier of 90 days after such termination of employment or
the date the Option expires in accordance with its terms. If Optionee's
employment with the Company and all subsidiaries is terminated due to his
disability or death, the Option shall expire on the earlier of the first
anniversary of such termination of employment or the date the Option expires in
accordance with its terms. During such periods the Option may be exercised by
Optionee with respect to the same number of shares of Common Stock, in the same
manner, and to the same extent as if Optionee had continued employment during
such period and the Option shall be canceled with respect to all remaining
shares of Common Stock; provided that in the event Optionee shall die at a time
when the Option, or any portion thereof is exercisable by him, the Option shall
be exercisable in whole
-1-
<PAGE> 10
or in part during the applicable period set forth herein by a legatee or
legatees of the Option under Optionee's will, or by his executors, personal
representatives or distributees, with respect to the number of shares of Common
Stock which Optionee could have purchased hereunder on the date of his death
and the Option shall be canceled with respect to all remaining shares of Common
Stock.
Written notice of an election to exercise any portion of the
Option, specifying the portion thereof being exercised and the exercise date,
shall be given by Optionee, or his personal representative in the event of
Optionee's death, (i) by delivering such notice at the principal executive
offices of the Company no later than the exercise date, or (ii) by mailing such
notice, postage prepaid, addressed to the Secretary of the Company at the
principal executive offices of the Company at least three business days prior
to the exercise date.
15. ASSIGNABILITY. The Option may be exercised only by
Optionee during his lifetime and may not be transferred other than by will or
the applicable laws of descent or distribution. The Option shall not otherwise
be transferred, assigned, pledged or hypothecated for any purpose whatsoever
and is not subject, in whole or in part, to execution, attachment, be similar
process. Any attempted assignment, transfer, pledge or hypothecation or other
disposition of the Option, other than in accordance with the terms set forth
herein, shall be void and of no effect.
16. STATUS AS SHAREHOLDERS. Neither Optionee nor any other
person entitled to exercise the Option under the terms hereof shall be, or have
any of the rights or privileges of, a shareholder of the Company in respect of
any of the shares of Common Stock issuable on exercise of the Option, unless
and until the purchase price for such shares shall have been paid in full and
the shares issued.
17. SURRENDER OF AGREEMENT, NOTATION. In the event the
Option shall be exercised in whole, this agreement shall be surrendered to the
Company for cancellation. In the event the Option shall be exercised in part,
or a change in the number or designation of the Common Stock shall be made,
this agreement shall be delivered by Optionee to the Company for the purpose of
making appropriate notation thereon, or of otherwise reflecting, in such manner
as the Company shall determine, the partial exercise or the change in the
number or designation of the Common Stock.
18. ADMINISTRATIVE REGULATIONS. The Option shall be
exercised in accordance with such administrative regulations as the Committee
shall from time to time adopt.
19. TEXAS LAWS. The Option and this agreement shall be
construed, administrative and governed in all respects under and by the laws of
the State of Texas.
20. RESTRICTIONS.
(a) SECURITIES LAW. Neither the Option nor the
Shares of Common Stock to be received upon the exercise thereof have at the
date of grant been registered pursuant to the Securities Act of 1933,
("Securities Act") as amended or any state securities laws. The Shares
issuable upon exercise of the Option may not be transferred, sold or otherwise
disposed of without registration under the Securities Act and any applicable
state security laws, or exemption therefrom. The Shares issuable upon the
exercise of the Option will not be transferred on the records of the Company
and new certificates issued unless evidence satisfactory to the Company is
presented that such transfer will not be a violation of the Securities Act or
any applicable state securities laws, and to evidence such restriction each
certificate of Common Stock issued to Optionee shall bear the following or
similar restrictive legend:
"The shares represented by this certificate have not been
registered under the Securities act of 1933, as amended, or
the securities laws of any state, pursuant to one or more
exemptions therefrom. Such shares may not be sold,
transferred or otherwise disposed of in the absence of any
such registration unless the Company is furnished with an
opinion of counsel reasonably satisfactory to the Company
-2-
<PAGE> 11
to the effect that such transfer is exempt from registration
under such laws.
These shares are also subject to restrictions contained in the
D Stockholders Agreement dated December 31, 1995 as amended, a
copy of which is available for inspection at the offices of
the Company"
(b) SHAREHOLDER AGREEMENT. The exercise of the
Option and delivery of the Shares is conditioned on the Optionee executing the
D Stockholders Agreement dated effective December 31, 1993 as amended, a copy
of which will be furnished Optionee upon request.
CHAMPION HEALTHCARE CORPORATION
By:
----------------------------
The undersigned hereby accepts the foregoing Option and the
terms and conditions hereof.
SELECTED EXECUTIVE
-------------------------------
Date: , 199
-------------------- -
-3-
<PAGE> 1
EXHIBIT - 5
[LETTERHEAD]
MICHENER, LARIMORE, SWINDLE, WHITAKER, FLOWERS,
SAWYER, REYNOLDS & CHALK, L.L.P.
(817) 878-0530 Refer to File No.
11574.187
July 25, 1995
Champion Healthcare Corporation
14340 Torrey Chase, Suite 320
Houston, Texas 77014
Re: Founders' Stock Options
Champion Healthcare Corporation Employee Stock Option Plan;
Champion Healthcare Corporation Employee Stock Option Plan
No. 2;
Champion Healthcare Corporation Employee Stock Option Plan
No. 3;
Champion Healthcare Corporation Directors' Stock Option Plan;
Champion Healthcare Corporation Physicians Stock Option Plan;
Champion Healthcare Corporation Senior Executive Stock Option
Plan No. 4;
AmeriHealth, Inc. 1988 Non-Qualified Stock Option Plan;
Champion Healthcare Corporation Selected Executive Stock
Option Plan No. 5
Gentlemen:
As set forth in the Registration Statement on Form S-8 (the
"Registration Statement") to be filed by Champion Healthcare Corporation, a
Delaware corporation (the "Company"), with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended (the
"Act"), relating to 1,077,164 shares of common stock, $0.01 par value, of the
Company (the "Common Stock"), to be issued from time to time pursuant to the
above-referenced plans agreement (collectively the "Plans"), certain legal
matters in connection with the Common Stock are being passed upon for you by
us. At your request, this opinion is being furnished to you for filing as
Exhibit 5 to the Registration Statement.
The Plans provide for the grant to certain key employees, directors,
and medical staff physicians of the Company and its subsidiaries (i)
nonstatutory stock options ("Nonstatutory Options"), and (ii) stock
appreciation rights ("SARs"). As used herein, the term "Options" shall mean
Nonstatutory Options, and the term "Option Shares" shall mean the Shares
issuable upon the exercise of Options.
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[LETTERHEAD]
Champion Healthcare Corporation
July 25, 1995
Page 2
In our capacity as your counsel in connection referred to above, we
have examined the Plans, the Company's Articles of Incorporation, and its
Bylaws, each as amended to date, and have examined the originals, or copies
certified or otherwise identified, of corporate records of the Company,
including minute books of the Company as furnished to us by the Company,
certificates of public officials and of representatives of the Company,
statutes and other instruments or documents, a basis for the opinions
hereinafter expressed.
We have assumed that all signatures on all documents examined by us
are genuine, that all documents submitted to us as originals are accurate and
complete, that all documents submitted to us as copies are true and correct
copies of the originals thereof and that all information submitted to us was
accurate and complete.
Based upon our examination as aforesaid and subject to assumptions,
limitations and qualifications set forth herein, we are of the opinion that:
1. The Company is a corporation duly organized and
validly existing in good standing under the laws of the State of
Delaware.
2. Upon the issuance and delivery of such Option Shares
upon the exercise of Options in accordance with the Plans and the
receipt of the consideration fixed by the Options, such Option Shares
will be validly issued, fully paid and nonassessable.
We do not express any opinion herein on any other respect of the
Options or the Option Shares, the effect of any equitable principles or
fiduciary considerations relating to the adoption of the Plans or the issuance
of the Options or Option Shares, the enforceability of any particular
provisions of the Plans or the Options, or the provisions of the Plans or
Options which discriminate or create unequal voting power among shareholders.
The opinions set forth above are limited in all respects to matters of
Delaware law as in effect on the date hereof.
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[LETTERHEAD]
Champion Healthcare Corporation
July 25, 1995
Page 3
We consent to the inclusion in the Registration Statement (Form S-8)
pertaining to the Champion Healthcare Corporation Founders' Stock Options,
Champion Healthcare Corporation Employee Stock Option Plan, Champion Healthcare
Corporation Employee Stock Option Plan No. 2, Champion Healthcare Corporation
Employee Stock Option Plan No. 3, Champion Healthcare Corporation Directors'
Stock Option Plan, Champion Healthcare Corporation Physicians Stock Option
Plan, Champion Healthcare Corporation Senior Executive Stock Option Plan No. 4,
AmeriHealth, Inc. 1988 Non-Qualified Stock Option Plan, and Champion Healthcare
Corporation Selected Executive Stock Option Plan No. 5, of this opinion.
Very truly yours,
/s/ Wayne M. Whitaker
Wayne M. Whitaker, Partner
WMW/jj
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EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statement of
Champion Healthcare Corporation, on Form S-8 (File No. 33-________) of our
report dated March 30, 1995, on our audits of the consolidated financial
statements of Champion Healthcare Corporation. We also consent to the
reference to our firm under the caption "Experts."
Coopers & Lybrand, L.L.P.
Houston, Texas
July 31, 1995
