<PAGE> 1
As filed with the Securities and Exchange Commission on October 6, 1997.
File No. 333-______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
- --------------------------------------------------------------------------------
RENAL CARE GROUP, INC.
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 62-1622383
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
2100 WEST END AVENUE, SUITE 800
NASHVILLE, TENNESSEE 37203
(615) 345-5500
(Address, including zip code, and telephone number of
Principal Executive Offices)
RENAL CARE GROUP, INC. THIRD AMENDED AND RESTATED 1996 STOCK INCENTIVE
PLAN OUTSTANDING OPTIONS GRANTED OUTSIDE OF A PLAN FOR 18,500 SHARES GRANTED
TO EMPLOYEES, DIRECTORS, MEDICAL DIRECTORS AND CONSULTANTS
(Full Title of the Plans)
SAM A. BROOKS, JR.
PRESIDENT AND CHIEF EXECUTIVE OFFICER
RENAL CARE GROUP, INC.
2100 WEST END AVENUE, SUITE 800
NASHVILLE, TENNESSEE 37203
(615) 345-5500
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
-------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
==============================================================================================================
Proposed Proposed
Title of Securities Amount to Maximum Maximum Amount of
to be Registered be Registered(1) Offering Price Aggregate Registration
Per Share(2) Offering Price(2) Fee(2)
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 par
value per share(3) 1,508,318 20.15 30,392,608 9,210
- --------------------------------------------------------------------------------------------------------------
Common Stock, $.01 par
value per share(4) 786,760 35.75 28,126,670 8,523
- --------------------------------------------------------------------------------------------------------------
TOTAL 2,295,078 25.50 58,519,278 17,733
- --------------------------------------------------------------------------------------------------------------
</TABLE>
(1) An aggregate of 3,000,000 shares of Renal Care Group, Inc. Common Stock are
issuable under the Third Amended and Restated 1996 Stock Incentive Plan
(formerly known as the Amended and Restated 1996 Stock Option Plan) (the
"Plan") and options to purchase 1,359,750 shares of Renal Care Group, Inc.
Common Stock have been granted outside of a plan ("Freestanding Options").
The Registrant has previously filed a Registration Statement on Form S-8
with respect to 732,672 shares issuable under the Plan and 1,332,000 shares
issuable upon the exercise of
<PAGE> 2
Freestanding Options. This Registration Statement registers 2,267,328
shares under the Plan and 27,750 Freestanding Options and also covers any
additional shares that may hereafter become issuable as a result of the
adjustment and anti-dilution provisions of the Plan and the Freestanding
Options.
(2) Estimated solely for the purpose of calculating the registration fee, in
accordance with Rule 457(h)(1) based on (i) the median offering price with
respect to shares for which the offering price is known, and (ii) the
average of the closing bid and ask price of $35.75 per share for the
Registrant's Common Stock on the Nasdaq National Market on October 2,
1997 with respect to shares for which the offering price is not known.
(3) Shares subject to outstanding options granted under the Plan and
outstanding Freestanding Options.
(4) Shares which may be issued under the Plan and upon the exercise of options
which may be granted in the future under the Plan.
<PAGE> 3
- --------------------------------------------------------------------------------
PART II. INFORMATION REQUIRED IN REGISTRATION STATEMENT
- --------------------------------------------------------------------------------
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The Registrant's Registration Statement on Form S-8 with respect to the
Renal Care Group, Inc. Employee Stock Purchase Plan; Renal Care Group, Inc. 1996
Stock Option Plan; Outstanding Options Granted Outside of a Plan for 1,332,000
Shares Granted to Employees, Directors, Medical Directors and Consultants; Renal
Care Group, Inc. 1996 Stock Option Plan for Outside Directors; and Renal Care
Group, Inc. 1994 Stock Option Plan filed with the Securities and Exchange
Commission on April 22, 1996 (File No. 333-03886) is hereby incorporated by
reference.
The following additional documents are incorporated by reference into this
Registration Statement and are deemed to be a part hereof from the date of the
filing of such documents:
(1) The Registrant's Prospectus dated November 19, 1996 contained in the
Registrant's Amendment No. 2 to Registration Statement on Form S-1 filed
November 19, 1996 (Registration No. 33-80221).
(2) All reports filed by the Registrant pursuant to Section 13(a) or 15(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act") since
February 6, 1996.
(3) The description of Common Stock contained in the Registrant's
Registration Statement on Form 8-A as declared effective by the Commission on
February 6, 1996, including all amendments or reports filed for the purpose of
updating such description.
All other report and documents subsequently filed by the Registrant
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the
filing of a post-effective amendment which indicates that all securities offered
hereby have been sold or which deregisters all securities then remaining unsold,
shall be deemed to be incorporated by reference herein and to be a part hereof
from the date of filing of such documents.
Any statement contained in a document incorporated or deemed incorporated
herein by reference shall be deemed to be modified or superseded for the purpose
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 herein by reference modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Registration Statement.
<PAGE> 4
ITEM 8. EXHIBITS
The exhibits included as part of this Registration Statement are as
follows:
<TABLE>
<CAPTION>
Exhibit Number Description
-------------- -----------
<S> <C>
4(a) Amended and Restated Certificate of Incorporation of the
Registrant (incorporated by reference to Exhibit 3.1 of the
Registrant's Registration Statement on Form S-1, Registration
No. 333-80221)
4(b) Amended and Restated Bylaws of the Registrant (incorporated by
reference to Exhibit 3.2 of the Registrant's Registration
Statement on Form S-1, Registration No. 333-80221)
5(a) Opinion of Alston & Bird
23(a) Consent of Counsel (included in Exhibit 5(a))
23(b) Consent of Ernst & Young LLP
23(c) Consent of Blue & Co., LLC
24(a) Power of Attorney (included in Part II of this Registration
Statement)
99(a) Third Amended and Restated 1996 Stock Incentive Plan
</TABLE>
(signatures on following page)
2
<PAGE> 5
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 Nashville, State of Tennessee, on October 6, 1997.
RENAL CARE GROUP, INC.
By: /s/ Sam A. Brooks, Jr.
------------------------------------
Sam A. Brooks, Jr.
President and Chief Executive Officer
3
<PAGE> 6
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each person whose signature appears
below constitutes and appoints Sam A. Brooks, Jr. and Ronald Hinds, and either
of them (with full power in each to act alone), as true and lawful
attorneys-in-fact, with full power of substitution, for him and in his name,
place and stead, in any and all capacities, to sign any 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,
hereby ratifying and confirming all that said attorneys-in-fact, or their
substitute or substitutes may lawfully do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on October 6, 1997.
<TABLE>
<CAPTION>
Signature Capacity
--------- --------
<S> <C>
/s/ Sam A. Brooks, Jr. President, Chief Executive Officer and Director
- --------------------------------- (principal executive officer)
Sam A. Brooks, Jr.
/s/ Ronald Hinds Executive Vice President, Chief Financial Officer,
- --------------------------------- Secretary and Treasurer (principal financial and
Ronald Hinds accounting officer)
/s/ John D. Bower, M.D. Director and Vice Chairman of the Board
- ---------------------------------
John D. Bower, M.D.
/s/ Joseph C. Hutts Director
- ---------------------------------
Joseph C. Hutts
/s/ Harry R. Jacobson, M.D. Director and Chairman of the Board
- ---------------------------------
Harry R. Jacobson, M.D.
/s/ Thomas A. Lowery, M.D. Director
- ---------------------------------
Thomas A. Lowery, M.D.
/s/ Stephen D. McMurray, M.D. Director
- ---------------------------------
Stephen D. McMurray, M.D.
/s/ W. Tom Meredith, M.D. Director
- ---------------------------------
W. Tom Meredith, M.D.
/s/ Kenneth E. Johnson, Jr., M.D. Director
- ---------------------------------
Kenneth E. Johnson, Jr., M.D.
</TABLE>
4
<PAGE> 7
EXHIBIT INDEX
TO
REGISTRATION STATEMENT ON FORM S-8
<TABLE>
<CAPTION>
Exhibit Number Description
- -------------- -----------
<S> <C>
4(a) Amended and Restated Certificate of Incorporation of the
Registrant (incorporated by reference to Exhibit 3.1 of the
Registrant's Registration Statement on Form S-1, Registration
No. 333-80221)
4(b) Amended and Restated Bylaws of the Registrant (incorporated by
reference to Exhibit 3.2 of the Registrant's Registration
Statement on Form S-1, Registration No. 333-80221)
5(a) Opinion of Alston & Bird
23(a) Consent of Counsel (included in Exhibit 5(a))
23(b) Consent of Ernst & Young LLP
23(c) Consent of Blue & Co., LLC
24(a) Power of Attorney (included in Part II of this Registration
Statement)
99(a) Third Amended and Restated 1996 Stock Incentive Plan
</TABLE>
<PAGE> 1
EXHIBIT 5(a)
ALSTON&BIRD LLP
One Atlantic Center
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
404-881-7000
Fax: 404-881-7777 Telex: 54-2996
October 6, 1997
Renal Care Group, Inc.
2100 West End Avenue, Suite 800
Nashville, Tennessee 37203
Re: Form S-8 Registration Statement --
Renal Care Group, Inc.
Ladies and Gentlemen:
We have acted as counsel for Renal Care Group, Inc., a Delaware
corporation (the "Corporation"), in connection with the referenced Registration
Statement on Form S-8 (the "Registration Statement") being filed by the
Corporation with the Securities and Exchange Commission (the "Commission") under
the Securities Act of 1933, as amended, and covering 2,267,328 shares of the
Corporation's common stock, $0.01 par value ("Common Stock"), that may be issued
pursuant to the Renal Care Group, Inc. Third Amended and Restated 1996 Stock
Incentive Plan and outstanding options granted outside of a plan for 27,750
shares of Corporation common stock granted to employees, directors, medical
directors and consultants of the Corporation (collectively, the "Options and
Plan"). This Opinion Letter is rendered pursuant to Item 8 of Form S-8 and Item
601(b)(5) of Regulation S-K.
This Opinion Letter is limited by, and is in accordance with, the
January 1, 1992 edition of the Interpretive Standards Applicable to Legal
Opinions to Third Parties in Corporate Transactions adopted by the Legal Opinion
Committee of the Corporate and Banking Law Section of the State Bar of Georgia
(the "Interpretive Standards"), which Interpretative Standards are incorporated
in this Opinion Letter by this reference. Capitalized terms used in this Opinion
Letter and not otherwise defined herein shall have the meanings assigned to such
terms in the Interpretive Standards and in the Registration Statement.
601 Pennsylvania Avenue, N.W.
North Building, Suite 250
Washington, D.C. 20004-2601
<PAGE> 2
In the capacity described above, we have considered such matters of law
and of fact, including the examination of originals or copies, certified or
otherwise identified to our satisfaction, of such records and documents of the
Corporation, certificates of public officials and such other documents as we
have deemed appropriate as a basis for the opinions hereinafter set forth. The
opinions set forth herein are limited to the laws of the State of Delaware as
expressed in the Delaware General Corporation Law, in reliance solely on
published general compilations thereof as of the date hereof.
Based upon the foregoing, it is our opinion that the 2,295,078 shares
of Common Stock covered by the Registration Statement and to be issued pursuant
to the Options and Plan, when issued in accordance with the terms and conditions
of the Options and Plan, will be legally and validly issued, fully paid and
nonassessable.
This Opinion Letter is provided to you for your benefit and for the
benefit of the Commission, in each case, solely with regard to the Registration
Statement, may be relied upon by you and the Commission only in connection with
the Registration Statement, and may not be relied upon by any other person or
for any other purpose without our prior written consent.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and further consent to the use of our name wherever
appearing in the Registration Statement.
Sincerely,
ALSTON & BIRD
By: /s/ STEVEN L. POTTLE
-----------------------
Steven L. Pottle, Esq.
2
<PAGE> 1
EXHIBIT 23(b)
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form
S-8) pertaining to the Renal Care Group, Inc. Third Amended and Restated 1996
Stock Incentive Plan of our report dated February 28, 1997, with respect to the
consolidated financial statements and schedule of Renal Care Group, Inc.
included in its Annual Report (Form 10-K) for the year ended December 31, 1996,
filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
Nashville, Tennessee
October 3, 1997
<PAGE> 1
EXHIBIT 23(c)
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form
S-8) pertaining to the Renal Care Group, Inc. Third Amended and Restated 1996
Stock Incentive Plan of our report dated May 16, 1997, with respect to the
combined financial statements of Indiana Dialysis Services, P.C. et al included
in Amendment No. 1 to the Company's Current Report on Form 8-K/A for the year
ended December 31, 1996, filed with the Securities and Exchange Commission.
BLUE & CO., LLC
Indianapolis, Indiana
October 3, 1997
<PAGE> 1
EXHIBIT 99(a)
RENAL CARE GROUP, INC.
THIRD AMENDED AND RESTATED 1996 STOCK INCENTIVE PLAN
ARTICLE 1
PURPOSE
1.1 GENERAL. The purpose of the Renal Care Group, Inc. Amended and
Restated 1996 Stock Incentive Plan (the "Plan") is to promote the success, and
enhance the value, of Renal Care Group, Inc. (the "Company"), by linking the
personal interests of its key employees and consultants to those of Company
stockholders and by providing its key employees and consultants with an
incentive for outstanding performance. The Plan is further intended to provide
flexibility to the Company in its ability to motivate, attract, and retain the
services of employees and consultants upon whose judgment, interest, and special
effort the successful conduct of the Company's operation is largely dependent.
Accordingly, the Plan permits the grant of restricted stock and stock options
from time to time to selected officers and key employees and consultants.
ARTICLE 2
EFFECTIVE DATE
2.1 EFFECTIVE DATE. The Plan first became effective upon approval of
the same by the Board of Directors of the Company (January 15, 1996) (the
"Effective Date"), as approved by the sole stockholder of the Company. The first
amendments to the Plan were approved by the Board of Directors of the Company on
August 15, 1996, and became effective upon approval thereof by the stockholders
of the Company at the special meeting of stockholders held on September 27,
1996. The second amendments to the Plan were approved by the Board of Directors
on April 10, 1997, and became effective upon approval thereof by the
stockholders of the Company at the annual meeting held on June 4, 1997. The
third amendments to the Plan were approved by the Board of Directors of the
Company on September 4, 1997, which amendments did not require approval by the
stockholders of the Company and became effective as of September 4, 1997.
ARTICLE 3
DEFINITIONS
3.1 DEFINITIONS. When a word or phrase appears in this Plan with the
initial letter capitalized, and the word or phrase does not commence a sentence,
the word or phrase shall generally be given the meaning ascribed to it in this
Section or in Sections 1.1 or 2.1 unless a clearly different meaning is required
by the context. The following words and phrases shall have the following
meanings:
(a) "Award" means any Option or Restricted Stock Award
granted to a Participant under the Plan.
<PAGE> 2
(b) "Award Agreement" means any written agreement, contract,
or other instrument or document evidencing an Award.
(c) "Board" means the Board of Directors of the Company.
(d) "Cause" means the continued failure by a Participant to
substantially perform such Participant's duties of employment after
written warnings identifying the lack of substantial performance are
communicated to the Participant by the employer that identify the
manner in which the employer believes that the Participant has not
substantially performed such duties, or the engaging by an Participant
in illegal conduct that is materially and demonstrably injurious to the
Company, unless otherwise defined in an employment agreement between
the Participant and the Company or a Subsidiary in effect on the date
of termination in which case "Cause" shall be defined as set forth
therein.
(e) "Change in Control" means a change in control of the
Company after the closing of an initial public offering of Stock
registered under the Securities Act on a Registration Statement on Form
S-1 of a nature that would be required to be reported (assuming such
event has not been "previously reported") in response to Item 1(a) of a
Current Report on Form 8-K pursuant to Section 13 or 15(d) of the
Exchange Act; provided that, without limitation, a Change in Control
shall also be deemed to have occurred at such time as:
(i) any "person" within the meaning of Section 14(d)
of the Exchange Act, other than the Company, a Subsidiary, or any
employee benefit plan(s) sponsored by the Company or any Subsidiary, is
or has become the "beneficial owner," as defined in Rule 13d-3 under
the Exchange Act, directly or indirectly, of 25% or more of the
combined voting power of the outstanding securities of the Company
ordinarily having the right to vote at the election of directors;
(ii) individuals who constitute the Board immediately
prior to any meeting of stockholders (the "Incumbent Board") have
ceased for any reason to constitute at least a majority thereof,
provided that any person becoming a director whose election, or
nomination for election by the Company's stockholders, was approved by
a vote of at least three-quarters (3/4) of the directors comprising the
Incumbent Board (either by a specific vote or by approval of the proxy
statement of the Company in which such person is named as a nominee for
director without objection to such nomination) shall be, for purposes
of this Agreement, considered as though such person were a member of
the Incumbent Board;
(iii) upon approval by the Company's stockholders of
a reorganization, merger, share exchange or consolidation, other than
one with respect to which those persons who were the beneficial owners,
immediately prior to such reorganization, merger, share exchange or
consolidation, of outstanding securities of the Company ordinarily
having the right to vote in the election of directors own, immediately
after such transaction, more than 75% of the outstanding securities of
the resulting corporation ordinarily having the right to vote in the
election of directors; or
2
<PAGE> 3
(iv) upon approval by the Company's stockholders of a
complete liquidation and dissolution of the Company or the sale or
other disposition of all or substantially all of the assets of the
Company other than to a Subsidiary.
Notwithstanding the occurrence of any of the
foregoing, the Board may determine, if it deems it to be in the best
interest of the Company, that an event or events otherwise constituting
a Change in Control shall not be so considered. Such determination
shall be effective if it is made by the Board prior to the occurrence
of an event that otherwise would be or probably will lead to a Change
in Control or after such event if made by the Board a majority of which
is composed of directors who were members of the Board immediately
prior to the event that otherwise would be or probably will lead to a
Change in Control. Upon such determination, such event or events shall
not be deemed to be a Change in Control for any purposes hereunder,
including but not limited to, Section 9.6.
(f) "Change in Control Price" means the highest closing price
per share paid for the purchase of Stock in a national securities
market during the ninety (90) day period ending on the date the Change
in Control occurs.
(g) "Code" means the Internal Revenue Code of 1986, as amended
from time to time.
(h) "Committee" means the committee of the Board described in
Article 4.
(i) "Company" means Renal Care Group, Inc., a Delaware
corporation.
(j) "Covered Employee" means a covered employee as defined
in Code Section 162(m)(3).
(k) "Disability" shall mean any permanent disability as
defined by Section 22(e)(3) of the Code. The Committee may require such
medical or other evidence as it deems necessary to judge the nature and
permanency of a Participant's Disability.
(l) "Effective Date" has the meaning assigned such term in
Section 2.1.
(m) "Exchange Act" means the Securities Exchange Act of 1934,
as amended from time to time.
(n) "Fair Market Value" means the closing price of the shares
of Stock on the New York Stock Exchange or other national securities
exchange on the day on which such value is to be determined or, if no
shares were traded on such day, on the next preceding day on which
shares were traded, as reported by the National Quotation Bureau, Inc.
or other national quotation service. If the shares are not traded on an
exchange but are traded in the over-the-counter market, Fair Market
Value means the closing "asked" price of the shares in the
over-the-counter market on the day on which such value is to be
determined or, if such "asked" price is not available, the last sales
price on such day or, if no shares were traded on such day, on the next
preceding day on which the shares were traded, as reported by the
National Association of Securities Dealers Automatic Quotation System
(NASDAQ) or other national quotation service.
3
<PAGE> 4
(o) "Incentive Stock Option" means an Option that is intended
to meet the requirements of Section 422 of the Code or any successor
provision thereto.
(p) "Non-Qualified Stock Option" means an Option that is
not an Incentive Stock Option.
(q) "Option" means a right granted to a Participant under
Article 7 of the Plan to purchase Stock at a specified price during
specified time periods. An Option may be either an Incentive Stock
Option or a Non-Qualified Stock Option.
(r) "Participant" means a person who, as an officer or key
employee or consultant of the Company or any Subsidiary, has been
granted an Award under the Plan.
(s) "Plan" means the Renal Care Group, Inc. Amended
and Restated 1996 Stock Incentive Plan, as amended from time to time.
(t) "Restricted Stock Award" means Stock granted to a
Participant under Article 8 that is subject to certain restrictions and
to risk of forfeiture.
(u) "Securities Act" means the Securities Act of 1933, as
amended from time to time.
(v) "Stock" means the $0.01 par value common stock of the
Company and such other securities of the Company as may be substituted
for Stock pursuant to the terms of the Plan including but not limited
to Article 10 hereof.
(w) "Subsidiary" means any corporation that qualifies as a
subsidiary of a corporation under the definition of "subsidiary
corporation" contained in Section 424(f) of the Code.
ARTICLE 4
ADMINISTRATION
4.1 The Plan shall be administered by a committee of directors of the
Company (the "Committee") appointed by the Board from time to time and
consisting of at least two members of the Board, each of whom shall be both (i)
a "non-employee director" as such term is defined in Rule 16b-3 promulgated
under Section 16 of the Exchange Act or any successor provision, and (ii) an
"outside director" as that term is used in Section 162 of the Code and the
regulations promulgated thereunder. In the absence of an appointment of a
Committee, the Board shall serve as the Committee.
4.2 AUTHORITY OF COMMITTEE. The Committee has the exclusive power,
authority and discretion to:
(a) Designate Participants;
(b) Determine the type or types of Awards to be granted to
each Participant;
4
<PAGE> 5
(c) Determine the number of Awards to be granted and the
number of shares of Stock to which an Award will relate;
(d) Determine the terms and conditions of any Award granted
under the Plan, including but not limited to, the exercise price, any
restrictions or limitations on the Award, any schedule for lapse of
forfeiture restrictions or restrictions on the exercisability of an
Award, and accelerations or waivers thereof, based in each case on such
considerations as the Committee in its sole discretion determines;
(e) Determine whether, to what extent, and under what
circumstances an Award may be settled in, or the exercise price of an
Option may be paid in, cash, Stock, or other property, or an Award may
be canceled, forfeited, or surrendered;
(f) Prescribe the form of each Award Agreement, which need
not be identical for each Participant;
(g) Decide all other matters that must be determined in
connection with an Award;
(h) Establish, adopt or revise any rules and regulations as
it may deem necessary or advisable to administer the Plan; and
(i) Make all other decisions and determinations that may be
required under the Plan or as the Committee deems necessary or
advisable to administer the Plan.
4.3. DECISIONS BINDING. The Committee's interpretation of the Plan,
any Awards granted under the Plan, any Award Agreement and all decisions and
determinations by the Committee with respect to the Plan are final, binding, and
conclusive on all parties.
ARTICLE 5
SHARES SUBJECT TO THE PLAN
5.1. NUMBER OF SHARES. Subject to adjustment as provided in Section
10.1, the aggregate number of shares of Stock reserved and available for Awards
shall be 3,000,000 (which reflects a 3 for 2 stock split in the form of a
dividend with a record date of July 7, 1997).
5.2. LAPSED AWARDS. To the extent that an Award is canceled,
terminates, expires or lapses for any reason, any shares of Stock subject to the
Award will again be available for the grant of an Award under the Plan.
5.3. STOCK DISTRIBUTED. Any Stock distributed pursuant to an Award
may consist, in whole or in part, of authorized and unissued Stock, treasury
Stock or Stock purchased on the open market.
5.4. LIMITATION ON NUMBER OF SHARES SUBJECT TO AWARDS. Notwithstanding
any provision in the Plan to the contrary, the maximum number of shares of Stock
with respect to one or more Options that may be granted to any one Covered
Employee in any one taxable year shall be 150,000 (which reflects a 3 for 2
stock split in the form of a
5
<PAGE> 6
dividend with a record date of July 7, 1997), subject to adjustment as set
forth in Article 10 hereto.
ARTICLE 6
ELIGIBILITY
6.1. GENERAL. Awards may be granted only to individuals who are (i)
officers or other key employees (including employees who also are directors or
officers) of the Company or a Subsidiary, or (ii) bona fide consultants to the
Company or a Subsidiary, as determined by the Committee.
ARTICLE 7
STOCK OPTIONS
7.1. GENERAL. The Committee is authorized to grant Options to
Participants on the following terms and conditions:
(a) EXERCISE PRICE. The exercise price per share of Stock
under an Option shall be determined by the Committee. The Committee may
elect to grant Non-Qualified Stock Options with an exercise price per
share of Stock less than the Fair Market Value of a share of Stock on
the date any such Non-Qualified Stock Option is granted.
(b) TIME AND CONDITIONS OF EXERCISE.
(i) The Committee shall determine the time or times at which
an Option may be exercised in whole or in part. The Committee also
shall determine the performance or other conditions, if any, that must
be satisfied before all or part of an Option may be exercised.
(ii) In connection with the grant of any Options, the
Committee may provide in the Option Agreement for the termination of
all or any portion of the Options under certain circumstances,
including, without limitation, termination of a Participant's
employment, provided that the Committee may distinguish among various
causes of termination as the Committee deems appropriate. In addition,
the Committee may provide, through the Option Agreement or otherwise,
that if a Participant's employment is terminated: (i) such
Participant's Option(s) may be exercised for specified periods
thereafter but no later than the expiration date of such Option; (ii)
to the extent not fully exercisable on the date of termination of
employment, such Option may continue to become exercisable within the
term of the Option; or (iii) some or all of the Options not fully
exercisable on the date of termination of employment may be deemed
fully exercisable. A Participant's employment shall be deemed to
terminate on the last date for which he or she receives a regular wage
or salary payment (excluding severance payments unless otherwise
provided in the Option Agreement). Whether military, government or
other service or other leave of absence shall constitute a termination
of employment shall be determined in each case by the Committee at its
discretion, and any determination by the Committee shall be final and
conclusive. A termination of employment shall not occur where the
Participant transfers from the Company to one of
6
<PAGE> 7
its Subsidiaries, transfers from a Subsidiary to the Company or
transfers from one Subsidiary to another Subsidiary.
(c) PAYMENT. The Committee shall determine the methods by
which the exercise price of an Option may be paid, the form of payment,
including, without limitation, cash, shares of Stock, or other property
(including "cashless exercise" arrangements), and the methods by which
shares of Stock shall be delivered or deemed to be delivered to
Participants. Without limiting the power and discretion conferred on
the Committee pursuant to the preceding sentence, the Committee may, in
the exercise of its discretion, but need not, allow a Participant to
pay the exercise price of an Option by directing the Company to
withhold from the shares of Stock that would otherwise be issued upon
exercise of the Option that number of shares having a Fair Market Value
on the exercise date equal to the exercise price, all as determined
pursuant to rules and procedures established by the Committee.
(d) EVIDENCE OF GRANT. All Options shall be evidenced by a
written Option Agreement between the Company and the Participant.
The Option Agreement shall include such provisions as may be specified
by the Committee.
7.2. INCENTIVE STOCK OPTIONS. The terms of any Incentive Stock
Options granted under the Plan must comply with the following additional rules:
(a) EXERCISE PRICE. The exercise price per share of Stock
shall be set by the Committee, provided that the exercise price for
any Incentive Stock Option shall not be less than the Fair Market
Value as of the date of the grant.
(b) EXERCISE. In no event may any Incentive Stock Option be
exercisable for more than ten years from the date of its grant.
(c) INDIVIDUAL DOLLAR LIMITATION. The aggregate Fair Market
Value (determined as of the time an Option is made) of all shares of
Stock with respect to which Incentive Stock Options are first
exercisable by a Participant in any calendar year may not exceed
$100,000.
(d) TEN PERCENT OWNERS. No Incentive Stock Option shall be
granted to any individual who, at the date of grant, owns stock
possessing more than ten percent of the total combined voting power of
all classes of stock of the Company or any Subsidiary unless the
exercise price per share of such Option is at least 110% of the Fair
Market Value per share of Stock at the date of grant and the Option
expires no later than five years after the date of grant.
(e) EXPIRATION OF INCENTIVE STOCK OPTIONS. No award of an
Incentive Stock Option may be made pursuant to the Plan on or after
the tenth anniversary of the Effective Date.
(f) RIGHT TO EXERCISE. During a Participant's lifetime, an
Incentive Stock Option may be exercised only by the Participant.
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(g) INTERPRETATION OF INCENTIVE STOCK OPTIONS. In interpreting
this Section 7.2 of the Plan and the provisions of individual Option
Agreements granting Incentive Stock Options, the Committee shall be
governed by the principles and requirements of Sections 421, 422 and
424 of the Code, and applicable Treasury Regulations.
ARTICLE 8
RESTRICTED STOCK AWARDS
8.1. GRANT OF RESTRICTED STOCK. The Committee is authorized to make
Awards of Restricted Stock to Participants in such amounts and subject to such
terms and conditions as may be selected by the Committee. All Awards of
Restricted Stock shall be evidenced by a Restricted Stock Award Agreement.
8.2. ISSUANCE AND RESTRICTIONS. Restricted Stock shall be subject to
such restrictions on transferability and other restrictions as the Committee may
impose (including, without limitation, limitations on the right to vote
Restricted Stock or the right to receive dividends on the Restricted Stock).
These restrictions may lapse separately or in combination at such times, under
such circumstances, in such installments, upon the satisfaction of performance
goals or otherwise, as the Committee determines at the time of the grant of the
Award or thereafter.
8.3. FORFEITURE. Except as otherwise determined by the Committee at the
time of the grant of the Award or thereafter, upon termination of employment
during the applicable restriction period or upon failure to satisfy a
performance goal during the applicable restriction period, Restricted Stock that
is at that time subject to restrictions shall be forfeited and reacquired by the
Corporation; provided, however, that the Committee may provide in any Award
Agreement that restrictions or forfeiture conditions relating to Restricted
Stock will be waived in whole or in part in the event of terminations resulting
from specified causes, and the Committee may in other cases waive in whole or in
part restrictions or forfeiture conditions relating to Restricted Stock.
8.4. CERTIFICATES FOR RESTRICTED STOCK. Restricted Stock granted under
the Plan may be evidenced in such manner as the Committee shall determine. If
certificates representing shares of Restricted Stock are registered in the name
of the Participant, certificates must bear an appropriate legend referring to
the terms, conditions, and restrictions applicable to such Restricted Stock.
ARTICLE 9
GENERAL PROVISIONS APPLICABLE TO AWARDS
9.1. STAND-ALONE, TANDEM, AND SUBSTITUTE AWARDS. Awards granted under
the Plan may, in the discretion of the Committee, be granted either alone or in
addition to, in tandem with, or in substitution for, any other Award granted
under the Plan. If an Award is granted in substitution for another Award, the
Committee may require the surrender of such other Award in consideration of the
grant of the new Award. Awards granted in addition to or in tandem with other
Awards may be granted either at the same time as or at a different time from the
grant of such other Awards.
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9.2. EXCHANGE PROVISIONS. The Committee may at any time offer to
exchange or buy out any previously granted Award for a payment in cash, Stock,
or another Award (subject to Section 9.1), based on the terms and conditions the
Committee determines and communicates to the Participant at the time the offer
is made.
9.3. TERM OF OPTION. The term of each Option shall be for the period
as determined by the Committee, provided that in no event shall the term of any
Incentive Stock Option exceed a period of ten years from the date of grant.
9.4. LIMITS ON TRANSFER. No right or interest of a Participant in any
Award may be pledged, encumbered, or hypothecated to or in favor of any party
other than the Company or a Subsidiary, or shall be subject to any lien,
obligation, or liability of such Participant to any other party other than the
Company or a Subsidiary. No Award shall be assignable or transferable by a
Participant other than by will or the laws of descent and distribution or,
except in the case of an Incentive Stock Option, pursuant to a domestic
relations order as defined in Section 414(p)(1)(B) of the Code, if the order
satisfies Section 414(p)(1)(A) of the Code.
9.5. STOCK CERTIFICATES. All Stock certificates delivered under the
Plan are subject to any stop-transfer orders and other restrictions as the
Committee deems necessary or advisable to comply with federal or state
securities laws, rules and regulations and the rules of any national securities
exchange or automated quotation system on which the Stock is listed, quoted, or
traded. The Committee may place legends on any Stock certificate to reference
restrictions applicable to the Stock.
9.6. CHANGES IN CONTROL.
(a) Change in Control Followed by Employment Termination. In the
event that a Change in Control shall occur and an employee Participant's
employment shall terminate, except as provided in the next sentence, within
twelve (12) months after the Change in Control, then (i) all unexercised Awards
(whether vested or not vested) shall automatically become one hundred percent
(100%) vested immediately, (ii) no other terms, conditions, restrictions or
limitations shall be imposed upon any such Awards after such date, and in no
circumstance shall an Award be forfeited on or after such date, and (iii) all
such Awards shall be valued on the basis of the greater of the Change in Control
Price or the Fair Market Value on the date of such termination, and such value
shall promptly be paid to the Participant in cash by the Company or its
successor. The foregoing shall not apply if employment termination is due to (i)
death, (ii) disability entitling the Participant to benefits under the Company's
or its successor's long-term disability plan, (iii) Cause, or (iv) resignation
(other than (A) resignation from a declined reassignment to a job that is not
reasonably equivalent in responsibility or compensation or that is not in the
same geographic area, or (B) resignation within 30 days following a reduction in
base pay).
(b) Automatic Acceleration and Cash-Out. Upon a Change in
Control that results directly or indirectly in the Stock (or the stock of any
successor to the Company received in exchange for Stock) ceasing to be publicly
traded in a national securities market, (i) all unexercised Awards (whether
vested or not vested) shall automatically become one hundred percent (100%)
vested immediately, (ii) no other terms, conditions, restrictions or limitations
shall be imposed upon any such Awards after such date, and in no circumstance
shall an Award
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be forfeited on or after such date, and (iii) all such Awards shall be valued
on the basis of the Change in Control Price, and such value shall promptly be
paid to the Participant in cash by the Company or its successor.
(c) Miscellaneous. Upon a Change in Control, no action,
including, without limitation, the amendment, suspension or termination of the
Plan, shall be taken that would adversely affect the rights of any Participant
or the operation of the Plan with respect to any Award to which a Participant
may have become entitled hereunder on or prior to the date of the Change in
Control or to which such Participant may become entitled as a result of such
Change in Control.
9.7. MODIFICATION, EXTENSION AND RENEWAL. The Committee may modify,
renew or accept the surrender of outstanding Awards issued under the Plan (or
the surrender of similar grants issued under any other plan of the Company or a
Subsidiary), including the acceleration or waiver of any vesting or other
restrictions or limitations, or the conversion of such Awards (with appropriate
adjustments) to be applicable to the securities of any successor corporation to
the Company, and the Committee may authorize new Awards pursuant to the Plan in
substitution for any outstanding Awards. Any substituted, modified or converted
Awards may bear such different or additional terms and conditions as the
Committee shall deem appropriate within the limitations of the Plan. The
determination of the Committee as to the terms of any of the foregoing may be
made without regard to whether a Change in Control has or has not occurred (or
whether the Committee has determined that any event shall not be considered to
be a Change in Control) and shall be conclusive and binding notwithstanding the
provisions of the respective agreements regarding exercisability. Any fractional
shares resulting from any of the foregoing adjustments under this Section shall
be disregarded and eliminated. However, no modification of an Award shall,
without the consent of the Participant holding the Award, adversely affect the
rights or obligations of such Participant with respect to such Award.
ARTICLE 10
CHANGES IN CAPITAL STRUCTURE
10.1. GENERAL. If the Company's outstanding shares of Stock are
increased or decreased or changed into or exchanged for a different number or
kind of shares or other securities of the Company by reason of any
recapitalization, reclassification, stock split, combination of shares, stock
dividend, or transaction having similar effect, the Board shall proportionately
and appropriately adjust (i) the number of shares of Stock authorized and
reserved for grants under the Plan as set forth in Section 5.1, (ii) the number
of shares of Stock that may be subject to one or more Options granted to any one
Participant in any one taxable year as set forth in Section 5.4, and (iii) the
number and kind of shares that are subject to each Option and the exercise price
per share, without any change in the aggregate price to be paid therefor upon
exercise of each Option.
ARTICLE 11
AMENDMENT, MODIFICATION AND TERMINATION
11.1. AMENDMENT, MODIFICATION AND TERMINATION. With the approval of the
Board, at any time and from time to time, the Committee may terminate, amend or
modify the Plan without stockholder approval; provided, however, that the
Committee may condition
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any amendment on the approval of stockholders of the Company if such approval
is necessary or deemed advisable with respect to tax, securities or other
applicable laws, policies or regulations.
11.2 AWARDS PREVIOUSLY GRANTED. No termination, amendment, or
modification of the Plan shall adversely affect any Award previously granted
under the Plan, without the written consent of the Participant.
ARTICLE 12
GENERAL PROVISIONS
12.1. NO RIGHTS TO AWARDS. No Participant or employee shall have any
claim to be granted any Award under the Plan, and neither the Company nor the
Committee is obligated to treat Participants and employees uniformly.
12.2. NO STOCKHOLDER RIGHTS. No Award gives the Participant any of the
rights of a stockholder of the Company unless and until shares of Stock are in
fact issued to such person in connection with such Award.
12.3. WITHHOLDING. The Company or any Subsidiary shall have the
authority and the right to deduct or withhold, or require a Participant to remit
to the Company, an amount sufficient to satisfy federal, state, and local taxes
(including the Participant's FICA obligation) required by law to be withheld
with respect to any taxable event arising as a result of the Plan. With respect
to withholding required upon any taxable event under the Plan, the Committee
may, at the time the Award is granted or thereafter, require that any such
withholding requirement be satisfied, in whole or in part, by withholding shares
of Stock having a Fair Market Value on the date of withholding equal to the
amount to be withheld for tax purposes, all in accordance with such procedures
as the Committee establishes.
12.4. NO RIGHT TO EMPLOYMENT. Nothing in the Plan or any Award
Agreement shall interfere with or limit in any way the right of the Company or
any Subsidiary to terminate any Participant's employment at any time, nor confer
upon any Participant any right to continue in the employ of the Company or any
Subsidiary.
l2.5. UNFUNDED STATUS. The Plan is intended to be an "unfunded" plan
for incentive and deferred compensation. With respect to any payments not yet
made to a Participant pursuant to the Plan, nothing contained in the Plan or any
Award Agreement shall give the Participant any rights that are greater than
those of a general creditor of the Company or any Subsidiary.
12.6. RELATIONSHIP TO OTHER BENEFITS. No payment under the Plan shall
be taken into account in determining any benefits under any pension, retirement,
savings, profit sharing, group insurance, welfare or benefit plan of the Company
or any Subsidiary.
12.7. EXPENSES. The expenses of administering the Plan shall be borne
by the Company and its Subsidiaries.
12.8. TITLES AND HEADINGS. The titles and headings of the Sections in
the Plan are for convenience of reference only, and in the event of any
conflict, the text of the Plan, rather than such titles or headings, shall
control.
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12.9. GENDER AND NUMBER. Except where otherwise indicated by the
context, any masculine term used herein also shall include the feminine; the
plural shall include the singular and the singular shall include the plural.
12.10. FRACTIONAL SHARES. No fractional shares of Stock shall be issued
and the Committee shall determine, in its discretion, whether cash shall be
given in lieu of fractional shares or whether such fractional shares shall be
eliminated by rounding up.
12.11. SECURITIES LAW COMPLIANCE. It is intended that the provisions of
the Plan and any grant of Awards hereunder shall comply in all respects with the
terms and conditions of Rule 16b-3 under the Exchange Act, or any successor
provisions, as it relates to persons subject to the reporting requirements of
Section 16(a) of the Exchange Act. Any agreement granting any Awards shall
contain such provisions as are necessary or appropriate to assure such
compliance. To the extent that any provision hereof is found not to be in
compliance with such Rule as it relates to such Act, such provision shall be
deemed to be modified so as to be in compliance with such Rule, or if such
modification is not possible, shall be deemed to be null and void, as it relates
to such Participant.
12.12. GOVERNMENT AND OTHER REGULATIONS. The obligation of the Company
to make payment of awards in Stock or otherwise shall be subject to all
applicable laws, rules, and regulations, and to such approvals by government
agencies as may be required. The Company shall be under no obligation to
register under the Securities Act any of the shares of Stock paid under the
Plan. If the shares paid under the Plan may in certain circumstances be exempt
from registration under the Securities Act, the Company may restrict the
transfer of such shares in such manner as it deems advisable to ensure the
availability of any such exemption.
12.13. GOVERNING LAW. To the extent not governed by federal law, the
Plan and all Award Agreements shall be construed in accordance with and governed
by the laws of the State of Delaware.
IN WITNESS WHEREOF, Renal Care Group, Inc., acting by and through its
duly authorized officers, has executed this instrument as of the 4th day of
September 1997.
ATTEST: RENAL CARE GROUP, INC.
By: /s/ Ronald Hinds By: /s/ Sam A. Brooks, Jr.
------------------------ ---------------------------
Ronald Hinds, Secretary Sam A. Brooks, Jr.
President
and Chief Executive Officer
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