<PAGE> 1
As filed with the Securities and Exchange Commission on July 31, 1996
Registration No. 33-90418
- -===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
INPHYNET MEDICAL MANAGEMENT INC.
----------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 65-0501896
--------------------------------------- ---------------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
1200 South Pine Island Road
Suite 600, Fort Lauderdale, Florida 33324
------------------------------------------
(Address, including zip code,
of principal executive offices)
1994 STOCK INCENTIVE PLAN OF INPHYNET MEDICAL MANAGEMENT INC.
(AS AMENDED ON MAY 16, 1996)
-------------------------------------------------------------
(Full title of the plan)
David C. Peck, Esquire
Vice President and General Counsel
Inphynet Medical Management Inc.
1200 South Pine Island Road, Suite 600
Fort Lauderdale, Florida 33324
(954) 475-1300
-----------------------------------------
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------
Proposed maximum Proposed maximum
Title of securities Amount to be offering price per aggregate offering Amount of
to be registered registered(1) share (2) price (2) registration fee
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $0.01
par value per share 1,000,000 $12.75 $12,750,000 $4,396.55
</TABLE>
- -------------------------------
(1) This Registration Statement covers 1,000,000 shares authorized to be
sold under the 1994 Stock Incentive Plan of Inphynet Medical Management
Inc. (the "Plan").
(2) Estimated solely for calculating the amount of the
registration fee, pursuant to Rule 457(h) under the Securities
Act of 1933 (the "Securities Act").
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE
REGISTRATION STATEMENT
Item 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, filed with the Securities and Exchange
Commission (the "Commission") by Inphynet Medical Management Inc., a Delaware
corporation (the "Company"), are incorporated herein by reference:
(a) The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1995, filed pursuant to the Securities Exchange Act
of 1934, as amended (the "Exchange Act");
(b) The Company's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1996, filed pursuant to the Exchange Act;
(c) The Company's Registration Statement on Form S-8 (Registration
No. 33-90418), filed on March 17, 1995 pursuant to the Securities Act;
and
(d) The description of the common stock of the Company, $0.01 par
value per share (the "Common Stock"), contained in Amendment No. 3 to
the Company's Registration Statement on Form S-3 filed on October 27,
1995, under the heading "Description of Capital Stock," incorporated by
reference into the Company's Registration Statement on Form 8-A
(Registration No. 24336) filed on June 10, 1994, pursuant to the
Exchange Act.
In addition, all documents filed by the Company with the Commission
pursuant to Sections 13(a), 13(c), 14 and 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 the securities offered hereby
have been sold or which deregisters all securities then remaining unsold shall
be deemed to be incorporated herein by reference and to be a part hereof from
the date of the filing of such documents with the Commission.
Item 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
The validity of the shares of Common Stock offered hereby is being
passed upon for the Company by David C. Peck, who is an officer and General
Counsel of the Company. As of the date of this Registration Statement, Mr.
Peck beneficially owns 10,000 shares by virtue of vested options and has
unvested options to purchase 24,000 shares of Common Stock.
2
<PAGE> 3
Item 8. EXHIBITS
Exhibit No.
4.1* Specimen Certificate for shares of the Common Stock.
4.2** Certificate of Incorporation of the Company.
4.3** By-Laws of the Company.
5 Opinion of the General Counsel of the Company as to the
validity of the Common Stock to be issued.
10.1 1994 Stock Incentive Plan of Inphynet Medical Management Inc.
(As amended on May 16, 1996).
23.1*** Consent of Ernst & Young LLP.
23.2 Consent of the General Counsel of the Company (contained in
Exhibit 5).
* Incorporated by reference to the Registrant's Registration Statement on
Form S-3 (No. 33-97596)
** Incorporated by reference to the Registrant's Registration Statement on
Form S-1 (No. 33-80106)
*** Incorporated by reference to the Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1995.
3
<PAGE> 4
SIGNATURES
Pursuant to the requirements of the Securities Act, the Company 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 Fort Lauderdale, State of Florida, on the 31st day of July, 1996.
INPHYNET MEDICAL MANAGEMENT INC.
By: /s/ Clifford Findeiss
-----------------------------------------
Clifford Findeiss,
President and
Chief Executive Officer,
Chairman of the Board
4
<PAGE> 5
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Clifford Findeiss Chairman of the Board, President and Chief
- --------------------------------------------- Executive Officer July 31, 1996
Clifford Findeiss
/s/ Erie D. Chapman, III
- --------------------------------------------- Senior Executive Vice President and Director July 31, 1996
Erie D. Chapman, III
/s/ George W. McCleary, Jr. Executive Vice President, Chief Financial
- --------------------------------------------- Officer, Secretary and Director July 31, 1996
George W. McCleary, Jr.
/s/ Mary Ann Blanford
- --------------------------------------------- Vice President and Chief Accounting Officer July 31, 1996
Mary Ann Blanford
/s/ Martin Arostegui
- --------------------------------------------- Senior Vice President and Director July 31, 1996
Martin Arostegui
/s/ Jere D. Creed
- --------------------------------------------- Senior Vice President and Director July 31, 1996
Jere D. Creed
/s/ Marta Prado
- --------------------------------------------- Senior Vice President and Director July 31, 1996
Marta Prado
/s/ Neil J. Principe
- --------------------------------------------- Senior Vice President and Director July 31, 1996
Neil J. Principe
/s/ Victor J. Weinstein
- --------------------------------------------- Senior Vice President, Treasurer and Director July 31, 1996
Victor J. Weinstein
/s/ Stanley Margulies
- --------------------------------------------- Vice President and Director July 31, 1996
Stanley Margulies
/s/ Joseph J. Badal
- --------------------------------------------- Director July 31, 1996
Joseph J. Badal
/s/ Thomas E. Dewey, Jr.
- --------------------------------------------- Director July 31, 1996
Thomas E. Dewey, Jr.
/s/ Naresh Nagpal
- --------------------------------------------- Director July 31, 1996
Naresh Nagpal
/s/ Donald C. Wegmiller
- --------------------------------------------- Director July 31, 1996
Donald C. Wegmiller
</TABLE>
5
<PAGE> 1
Exhibit 5
[INPHYNET LETTERHEAD]
July 30, 1996
Ladies and Gentlemen:
I am General Counsel of Inphynet Medical Management Inc., a Delaware
corporation (the "Company"), and have acted as counsel to the Company with
respect to the Company's Registration Statement on Form S-8 (the "Registration
Statement") to be filed by the Company with the Securities and Exchange
Commission on July 31, 1996, in connection with the registration by the
Company under the Securities Act of 1933, as amended, of an aggregate of
1,000,000 shares of the Company's Common Stock, par value of $0.01 per share
(the "Common Stock"), to be sold in accordance with the terms of the Company's
1994 Stock Incentive Plan, as amended (the "Plan").
As counsel for the Company, I have examined among other things, such federal
and state laws and originals and/or copies of such documents, certificates and
records as I deemed necessary and appropriate for the purpose of preparing this
opinion.
Based on the foregoing, I am of the opinion that the newly issued shares of
Common Stock to be sold by the Company pursuant to the Plan have been duly and
validly authorized for issuance and, when issued and paid for in accordance
with the terms of the Plan for consideration in excess of $0.01 per share, will
be validly issued, fully paid and nonassessable.
I hereby consent to the inclusion of this opinion as part of the Registration
Statement.
Very truly yours,
/s/ David C. Peck
- --------------------------
David C. Peck
General Counsel
<PAGE> 1
Exhibit 10.1
1994 STOCK INCENTIVE PLAN OF
INPHYNET MEDICAL MANAGEMENT INC.
(As amended on May 16, 1996)
1. PURPOSE
The purpose of the 1994 Stock Incentive Plan ("Plan") of Inphynet Medical
Management Inc. ("Company") is to provide a means through which the Company and
its Subsidiaries and Affiliates may attract able persons to enter and remain in
the employ of the Company and its Subsidiaries and Affiliates, and to provide a
means whereby those key persons upon whom the responsibilities of the
successful administration and management of the Company rest, and whose present
and potential contributions to the welfare of the Company are of importance,
can acquire and maintain stock ownership, thereby strengthening their
commitment to the welfare of the Company and promoting an identity of interest
between stockholders and these key persons. Certain awards of Options granted
under the Plan to employees of the Company and its Subsidiaries and Affiliates
are intended to replace similar options held by such persons to purchase stock
or partnership interests of Emergency Medical Services Associates, Inc. and
Paragon Healthcare Limited Partnership, respectively, which terminated in
connection with the initial public offering of Common Stock.
A further purpose of the Plan is to provide such key persons with
additional incentive and reward opportunities designed to enhance the
profitable growth of the Company. So that the appropriate incentive can be
provided, the Plan provides for granting Incentive Stock Options, Nonqualified
Stock Options, Stock Appreciation Rights, Restricted Stock Awards, Phantom
Stock Unit Awards and Performance Share Units, or any combination of the
foregoing.
2. DEFINITIONS
The following definitions shall be applicable throughout the Plan.
"Affiliate" means any affiliate of the Company within the meaning of 17
CFR Section 230.405.
"Appreciation Date" means the date designated by a Holder of Stock
Appreciation Rights for measurement of the appreciation in the value of rights
awarded to him, which date shall be the date notice of such designation is
received by the Committee, or its designee.
"Award" means, individually or collectively, any Incentive Stock Option,
Nonqualified Stock Option, Stock Appreciation Right, Restricted Stock Award,
Phantom Stock Unit Award or Performance Share Unit Award.
<PAGE> 2
"Award Period" means a period of time within which performance is measured
for the purpose of determining whether an Award of Performance Share Units has
been earned.
"Board" means the Board of Directors of the Company.
"Cause" means the Company, a Subsidiary or an Affiliate having cause to
terminate a Participant's employment under any existing employment agreement
between the Participant and the Company, a Subsidiary or an Affiliate or, in
the absence of such an employment agreement, upon (i) the determination by the
Committee that the Participant has ceased to perform his duties to the Company,
or a Subsidiary or an Affiliate (other than as a result of his incapacity due
to physical or mental illness or injury), which failure amounts to an
intentional and extended neglect of his duties to such party, (ii) the
Committee's determination that the Participant has engaged or is about to
engage in conduct materially injurious to the Company, or a Subsidiary or an
Affiliate, or (iii) the Participant having been convicted of a felony.
"Change in Control" shall, unless the Board otherwise directs by
resolution adopted prior thereto, be deemed to occur if (i) any "person" (as
that term is used in Sections 13 and 14(d)(2) of the Securities and Exchange
Act of 1934 ("Exchange Act")) is or becomes the beneficial owner (as that term
is used in Section 13(d) of the Exchange Act), directly or indirectly, of 25%
or more of the voting Stock or (ii) during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board cease for
any reason to constitute at least a majority thereof, unless the election or
the nomination for election by the Company's shareholders of each new director
was approved by a vote of at least three-quarters of the directors then still
in office who were directors at the beginning of the period. Any merger,
consolidation or corporate reorganization in which the owners of the Company's
capital stock entitled to vote in the election of directors ("Voting Stock")
prior to said combination, own 50% or more of the resulting entity's Voting
Stock shall not, by itself, be considered a Change in Control.
"Code" means the Internal Revenue Code of 1986, as amended. Reference in
the Plan to any section of the Code shall be deemed to include any amendments
or successor provisions to such section and any regulations under such section.
"Committee" means the Compensation Committee of the Board or such other
committee as the Board may appoint to administer the Plan.
"Common Stock" means the common stock par value $.01 per share, of the
Company.
"Company" means Inphynet Medical Management Inc.
"Date of Grant" means the date on which the granting of an Award is
authorized or such other date as may be specified in such authorization.
"Disability" means the complete and permanent inability by reason of
illness or accident to perform the duties of the occupation at which a
Participant was employed when such disability
2
<PAGE> 3
commenced or, if the Participant was retired when such disability commenced, the
inability to engage in any substantial gainful activity, as determined by the
Committee based upon medical evidence acceptable to it.
"Disinterested Person" means a person who is a "disinterested person"
within the meaning of Rule 16b-3 of the Exchange Act, or any successor rule or
regulation.
"Eligible Employee" means any person regularly employed by the Company or
a Subsidiary or Affiliate on a full-time salaried basis, and any independent
contractor of the Company or a Subsidiary or Affiliate, who satisfies all of
the requirements of Section 6.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Fair Market Value" on a given date means (i) the last reported sale price
for the Stock on that date (or, if there were no such sales on that date, on
the next most recent date on which there were such sales) as reported on the
Composite Tape if the Stock is listed on the New York Stock Exchange ("NYSE")
or on the National Association of Securities Dealers National Market System
("NMS"), (ii) if the Stock is not then issued on the NYSE or the NMS but sales
of the Stock are reported by the National Association of Securities Dealers
Automatic Quotation System or any successor thereto ("AQS"), the average
between the closing bid and asked price quotations for the Stock on that date
(or if none on that date, on the next most recent date) as reported on the AQS,
or (iii) if the Stock is not then issued on the NYSE or the NMS, and sales of
the Stock are not reported by the AQS, the amount determined by the Board to be
the fair market value based upon a good faith attempt to value the Stock
accurately and computed in accordance with applicable regulations of the
Internal Revenue Service.
"Holder" means a Participant who has been granted an Option, a Stock
Application Right, a Restricted Stock Award, Phantom Stock Unit Award or a
Performance Share Unit Award.
"Incentive Stock Option" means an Option granted by the Committee to a
Participant under the Plan which is designated by the Committee as an Incentive
Stock Option pursuant to Section 422 of the Code.
"Nonqualified Stock Option" means an Option granted by the Committee to a
Participant under the Plan which is not designated by the Committee as an
Incentive Stock Option.
"Normal Termination" means termination:
(i) With respect to the Company or a Subsidiary, at
retirement (excluding early retirement) pursuant to the
Company retirement plan then in effect;
(ii) With respect to an Affiliate, at retirement
(excluding early retirement) pursuant to the retirement plan
of such
3
<PAGE> 4
Affiliate then in effect or, if the Affiliate has no such
plan, at retirement upon or after the attainment of age 65;
(iii) On account of Disability;
(iv) With the written approval of the Committee; or
(v) By the Company, a Subsidiary or Affiliate without
Cause.
"Option" means an Award granted under Section 7 of the Plan.
"Option Period" means the period described in Section 7(c).
"Participant" means an Eligible Employee who has been selected to
participate in the Plan and to receive an Award pursuant to Section 6.
"Performance Goals" means the performance objectives of the Company during
an Award Period or Restricted Period established for the purpose of determining
whether, and to what extent, Awards will be earned for an Award Period or
Restricted Period.
"Performance Share Unit" means a hypothetical investment equivalent equal
to one share of Stock granted in connection with an Award made under Section 9
of the Plan.
"Phantom Stock Unit" means a hypothetical investment equivalent equal to
one share of Stock granted in connection with an Award made under Section 10 of
the Plan, or credited with respect to Awards of Performance Share Units which
have been deferred under Section 9.
"Plan" means the 1994 Stock Incentive Plan of Inphynet Medical Management
Inc.
"Reporting Company" means the Company upon or after the first registration
of the Company's equity securities under the Exchange Act.
"Restricted Period" means, with respect to any share of Restricted Stock,
the period of time determined by the Committee during which such share of
Restricted Stock is subject to the restrictions set forth in Section 10.
"Restricted Stock" means shares of Common Stock issued or transferred to a
Participant subject to the restrictions set forth in Section 10 and any new,
additional or different securities a Participant may become entitled to receive
as a result of adjustments made pursuant to Section 12.
"Restricted Stock Award" means an Award granted under Section 10 of the
Plan.
"Securities Act" means the Securities Act of 1933, as amended.
4
<PAGE> 5
"Stock" means the Common Stock or such other authorized shares of stock
the Company as the Committee may from time to time authorize for use under the
Plan.
"Stock Appreciation Right" or "SAR" means an Award granted under Section 8
of the Plan.
"Subsidiary" means any subsidiary of the Company as defined in Section
424(f) of the Code.
"Valuation Date" means the last day of an Award Period or the date of
death of a Participant, as applicable.
3. EFFECTIVE DATE, DURATION AND SHAREHOLDER APPROVAL
Subject to the approval of this Plan by the shareholders of the Company at
a duly convened meeting of shareholders, or by a
written consent of shareholders effective under applicable state law, the Plan
shall become effective on May 7, 1994, and no further Awards may be made after
the expiration of 10 years therefrom.
The Plan shall continue in effect until all matters relating to the
payment of Awards and administration of the Plan have been settled.
4. ADMINISTRATION
The Committee shall administer the Plan. Each member of the Committee
shall, at the time he takes any action with respect to an Award under the Plan,
be a Disinterested Person; provided, however, that such requirement shall not
apply prior to the Company becoming a Reporting Company. Two members of the
Committee shall constitute a quorum. The acts of a majority of the members
present at any meeting at which a quorum is present or acts approved in writing
by a majority of the Committee shall be deemed the acts of the Committee.
No member of the Committee, while serving as such, shall be eligible to
receive an Award under the Plan; provided, however, that such requirement shall
not apply prior to the Company becoming a Reporting Company. Subject to the
provisions of the Plan, the Committee shall have exclusive power to:
(a) Select the Eligible Employees to participate in the Plan;
(b) Determine the nature and extent of the Awards to be made to each
Participant;
(c) Determine the time or times when Awards will be made;
(d) Determine the duration of each Award Period;
5
<PAGE> 6
(e) Determine the conditions to which the payment of Awards may be
subject;
(f) Establish the Performance Goals for each Award Period;
(g) Prescribe the form or forms evidencing Awards; and
(h) Cause records to be established in which there shall be entered, from
time to time as Awards are made to Participants, the date of each Award, the
number of Incentive Stock Options, Nonqualified Stock Options, SARs, Phantom
Stock Units, Performance Share Units and shares of Restricted Stock awarded by
the Committee to each Participant, the expiration date, the Award Period and the
duration of any applicable Restricted Period.
The Committee shall have the authority, subject to the provisions of the
Plan, to establish, adopt, or revise such rules and regulations and to make all
such determinations relating to the Plan as it may deem necessary or advisable
for the administration of the Plan. The Committee's interpretation of the Plan
or any Awards granted pursuant thereto and all decisions and determinations by
the Committee with respect to the Plan shall be final, binding, and conclusive
on all parties unless otherwise determined by the Board.
5. GRANT OF OPTIONS, STOCK APPRECIATION RIGHTS, RESTRICTED STOCK AWARDS,
PHANTOM STOCK AWARDS AND PERFORMANCE SHARE UNITS; SHARES SUBJECT TO THE
PLAN
The Committee may, from time to time, grant Awards of Options, Stock
Appreciation Rights, Restricted Stock, Phantom Stock Units and/or Performance
Share Units to one or more Participants; provided, however, that:
(a) Subject to Section 12, the aggregate number of shares of Stock
made subject to Awards may not exceed 2,500,000;
(b) Such shares shall be deemed to have been used in payment of
Awards whether they are actually delivered or the Fair Market Value
equivalent of such shares is paid in cash. In the event any Option, SAR
not attached to an Option, Restricted Stock, Phantom Stock Unit or
Performance Share Unit, shall be surrendered, terminate, expire, or be
forfeited, the number of shares of Stock no longer subject thereto shall
thereupon be released and shall thereafter be available for new Awards
under the Plan to the fullest extent permitted by Rule 16b-3 under the
Exchange Act (if applicable at the time);
(c) Stock delivered by the Company in settlement of Awards under the
Plan may be authorized and unissued Stock or Stock held in the treasury
of the Company or may be purchased on the open market or by private
purchase at prices no higher than the Fair Market Value at the time of
purchase; and
(d) No individual may receive Options or SARs representing more than
500,000 shares of Stock in any one year.
6
<PAGE> 7
6. ELIGIBILITY
Participants shall be limited to officers, key employees and independent
contractors of the Company and its Subsidiaries and Affiliates who have
received written notification from the Committee or from a person designated by
the Committee, that they have been selected to participate in the Plan.
7
<PAGE> 8
7. STOCK OPTIONS
One or more Incentive Stock Options or Nonqualified Stock Options can be
granted to any Participant; provided, however, that Incentive Stock Options may
be granted only to employees of the Company or a Subsidiary. Each Option so
granted shall be subject to the following conditions.
(a) OPTION PRICE. The Option price ("Option Price") per share of Stock
shall be set by the Committee at the time of grant but shall not be less than
(i) in the case of an Incentive Stock Option, the Fair Market Value of a share
of Stock at the Date of Grant, and (ii) in the case of a Non-Qualified Stock
Option, the par value per share of Stock.
(b) MANNER OF EXERCISE AND FORM OF PAYMENT. Options which have become
exercisable may be exercised by delivery of written notice of exercise to the
Committee accompanied by payment of the Option Price. The Option Price shall
be payable in cash and/or shares of Stock valued at the Fair Market Value at
the time the Option is exercised, or, in the discretion of the Committee,
either (i) in other property having a fair market value on the date of exercise
equal to the Option Price, or (ii) by delivering to the Committee a copy of
irrevocable instructions to a stockbroker to deliver promptly to the Company an
amount of sale or loan proceeds sufficient to pay the Option Price.
(c) OTHER TERMS AND CONDITIONS. If the Holder has not died or terminated,
the Option shall become exercisable in such manner and within such period or
periods ("Option Period"), not to exceed 10 years from its Date of Grant, as
set forth in the Stock Option Agreement to be entered into in connection
therewith.
(i) Each Option shall lapse in the following situations:
-- Ten years after it is granted;
-- Three months after Normal Termination, except as otherwise
provided by the Committee, or
-- Any earlier time set forth in the Stock Option Agreement.
(ii) If the Holder terminates otherwise than by Normal
Termination or death, the Option shall lapse at the time of termination.
(iii) If the Holder dies within the Option Period or within 3
months after Normal Termination (or such other period as may have been
established by the Committee), the Option shall lapse unless it is
exercised within the Option Period and in no event later than 12 months
after the date of Holder's death by the Holder's legal representative or
representatives or by the person or persons entitled to do so under the
Holder's last will and testament or, if the Holder shall fail to make
testamentary
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<PAGE> 9
disposition of such Option or shall die intestate, by the person entitled
to receive said Option under the applicable laws of descent and
distribution.
(d) STOCK OPTION AGREEMENT. Each Option granted under the Plan shall be
evidenced by a "Stock Option Agreement" between the Company and the Holder of
the Option containing such provisions as may be determined by the Committee,
but shall be subject to the following terms and conditions.
(i) Each Option or portion thereof that is exercisable shall
be exercisable for the full amount or for any part thereof, except as
otherwise determined by the terms of the Stock Option Agreement.
(ii) Each share of Stock purchased through the exercise of an
Option shall be paid for in full at the time of the exercise. Each
Option shall cease to be exercisable, as to any share of Stock, when the
Holder purchases the share or exercises a related SAR or when the Option
lapses.
(iii) Options shall not be transferable by the Holder except
by will or the laws of descent and distribution and shall be exercisable
during the Holder's lifetime only by him.
(iv) Each Option shall become exercisable by the Holder in
accordance with the vesting schedule established by the Committee for the
Award.
(v) Each Stock Option Agreement may contain an agreement that,
upon demand by the Committee for such a representation, the Holder shall
deliver to the Committee at the time of any exercise of an Option a
written representation that the shares to be acquired upon such exercise
are to be acquired for investment and not for resale or with a view to
the distribution thereof. Upon such demand, delivery of such
representation prior to the delivery of any shares issued upon exercise
of an Option shall be a condition precedent to the right of the Holder or
such other person to purchase any shares. In the event certificates for
Stock are delivered under the Plan with respect to which such investment
representation has been obtained, the Committee may cause a legend or
legends to be placed on such certificates to make appropriate reference
to such representation and to restrict transfer in the absence of
compliance with applicable federal or state securities laws.
(e) GRANTS TO 10% HOLDERS OF COMPANY VOTING STOCK. Notwithstanding
Section 7(a), if an Incentive Stock Option is granted to a Holder who owns
stock representing more than ten percent of the voting power of all classes of
stock of the Company or of the Company and its Subsidiaries, the period
specified in the Stock Option Agreement for which the Option thereunder is
granted and at the end of which such Option shall expire shall not exceed five
years from the Date of Grant of such Option and the Option Price shall be at
least 110 percent of the Fair Market Value (on the Date of Grant) of the Stock
subject to the Option.
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<PAGE> 10
(f) LIMITATION. To the extent the aggregate Fair Market Value (as
determined as of the Date of Grant) of Stock for which Incentive Stock Options
are exercisable for the first time by any Participant during any calendar year
(under all plans of the Company and its Subsidiaries) exceeds $100,000, such
excess Incentive Stock Options shall be treated as Nonqualified Stock Options.
(g) VOLUNTARY SURRENDER. The Committee may permit the voluntary surrender
of all or any portion of any Nonqualified Stock Option and its corresponding
SAR, if any, granted under the Plan to be conditioned upon the granting to the
Holder of a new Option for the same or a different number of shares as the
Option surrendered or require such voluntary surrender as a condition precedent
to a grant of a new Option to such Participant. Such new Option shall be
exercisable at the Option Price, during the exercise period, and in accordance
with any other terms or conditions specified by the Committee at the time the
new Option is granted, all determined in accordance with the provisions of the
Plan without regard to the Option Price, exercise period, or any other terms
and conditions of the Nonqualified Stock Option surrendered.
(h) ORDER OF EXERCISE. Options granted under the Plan may be exercised in
any order, regardless of the Date of Grant or the existence of any other
outstanding Option.
(i) NOTICE OF DISPOSITION. Participants shall give prompt notice to the
Company of any disposition of Stock acquired upon exercise of an Incentive
Stock Option if such disposition occurs within either two years after the Date
of Grant of such Option and/or one year after the receipt of such Stock by the
Holder.
8. STOCK APPRECIATION RIGHTS
Any Option granted under the Plan may include an SAR, either at the time
of grant or by amendment except that in the case of an Incentive Stock Option,
such SAR shall be granted only at the time of grant of the related Option. The
Committee may also award to Participants SARs independent of any Option. An
SAR shall be subject to such terms and conditions not inconsistent with the
Plan as the Committee shall impose, including, but not limited to, the
following:
(a) VESTING. An SAR granted in connection with an Option shall
become exercisable, be transferable and shall lapse according to the same
vesting schedule, transferability and lapse rules that are established
for the Option. An SAR granted independent of an Option shall become
exercisable, be transferable and shall lapse in accordance with a vesting
schedule, transferability and lapse rules established by the Committee.
Notwithstanding the above, an SAR shall not be exercisable by a person
subject to Section 16(b) of the Exchange Act for at least six months
following the date of grant.
(b) FAILURE TO EXERCISE. If on the last day of the Option Period
(or in the case of an SAR independent of an Option, the SAR period
established by the Committee), the Fair Market Value of the Stock exceeds
the Option Price, the Holder has
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not exercised the Option or SAR, and neither the Option nor the SAR has
lapsed, such SAR shall be deemed to have been exercised by the Holder on
such last day and the Company shall make the appropriate payment therefor.
(c) PAYMENT. The amount of additional compensation which may be
received pursuant to the award of one SAR is the excess, if any, of the
Fair Market Value of one share of Stock on the Appreciation Date over the
Option Price, in the case of an SAR granted in connection with an Option,
or the Fair Market Value of one share of Stock on the Date of Grant, in
the case of an SAR granted independent of an Option. With respect to SARs
exercised before the Company has been subject to the reporting
requirements of Section 13(a) of the Exchange Act for one year, the
Company shall issue or transfer to the Participant shares of Stock with a
Fair Market Value at such time equal to 100 percent of any such excess.
With respect to SARs exercised after the Company has been subject to such
reporting requirements for at least one year, the Company shall pay such
excess in cash, in shares of Stock valued at Fair Market Value, or any
combination thereof, as determined by the Committee. Fractional shares
shall be settled in cash.
(d) DESIGNATION OF APPRECIATION DATE. A Participant may designate an
Appreciation Date at such time or times as may be determined by the
Committee at the time of grant by filing an irrevocable written notice
with the Committee or its designee, specifying the number of SARs to which
the Appreciation Date relates, and the date on which such SARs were
awarded. Such time or times determined by the Committee may take into
account any applicable "window periods" required by Rule 16b-3 under the
Exchange Act.
(e) EXPIRATION. Except as otherwise provided in the case of SARs
granted in connection with Options, the SARs shall expire on a date
designated by the Committee which is not later than ten years after the
date on which the SAR was awarded.
9. PERFORMANCE SHARES
(a) AWARD GRANTS. The Committee is authorized to establish Performance
Share programs to be effective over designated Award Periods of not less than
three years nor more than five years. At the beginning of each Award Period,
the Committee will establish in writing Performance Goals based upon financial
objectives for the Company for such Award Period and a schedule relating the
accomplishment of the Performance Goals to the Awards to be earned by
Participants. Performance Goals may include absolute or relative growth in
earnings per share or rate of return on stockholders' equity or other
measurement of corporate performance and may be determined on an individual
basis or by categories of Participants. The Committee may adjust Performance
Goals or performance measurement standards as it deems equitable in recognition
of extraordinary or non-recurring events experienced during an Award Period by
the Company or by any other corporation whose performance is relevant to the
determination of whether Performance Goals have been attained. The Committee
shall determine the number of
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Performance Share Units to be awarded, if any, to each Participant who is
selected to receive an Award. The Committee may add new Participants to a
Performance Share program after its commencement by making pro rata grants.
(b) DETERMINATION OF AWARD. At the completion of a Performance Share
program, or at other times as specified by the Committee, the Committee shall
calculate the amount earned with respect to each Participant's award by
multiplying the Fair Market Value on the Valuation Date by the number of
Performance Share Units granted to the Participant and multiplying the amount
so determined by a performance factor representing the degree of attainment of
the Performance Goals.
(c) PARTIAL AWARDS. A Participant for less than a full Award Period,
whether by reason of commencement or termination of employment or otherwise,
shall receive such portion of an Award, if any, for that Award Period as the
Committee shall determine.
(d) PAYMENT OF NON-DEFERRED AWARDS. The amount earned with respect to an
Award shall be payable 100% in shares of Stock based on the Fair Market Value
on the Valuation Date; provided, however, that, at its discretion, the
Committee may vary such form of payment as to any Participant upon the specific
request of such Participant. The amount of any payment made in cash shall be
based upon the Fair Market Value on the seventh business day prior to payment.
Except as provided in subparagraph 9(e), payments of Awards shall be made as
soon as practicable after the completion of an Award Period.
(e) DEFERRAL OF PAYMENT. A Participant may file a written election with
the Committee to defer the payment of any amount otherwise payable pursuant to
subparagraph 9(d) on account of an Award to a period commencing at such future
date as specified in the election. Such election must be filed with the
Committee no later than the last day of the month which is two-thirds of the
way through the Award Period during which the Award is earned, unless the
Committee specifies an earlier filing date.
(f) SEPARATE ACCOUNTS. At the conclusion of each Award Period, the
Committee shall cause a separate account to be maintained in the name of each
Participant with respect to whom all or a portion of an Award of Performance
Share Units earned under the Plan has been deferred. All amounts credited to
such account shall be fully vested at all times.
(g) ELECTION OF FORM OF INVESTMENT. Within 60 days from the end of each
Award Period, and at such time or times, if any, as the Committee may permit, a
Participant may file a written election with the Committee of the percentage of
the deferred portion of any Award of Performance Share Units which is to be
expressed in the form of dollars and credited with interest, the percentage of
such Award which is to be expressed in the form of Phantom Stock Units and the
percentage of such Award which is to be deemed invested in any other
hypothetical investment equivalent from time to time made available under the
Plan by the Committee. In the event a Participant fails to file an election
within the time prescribed, one hundred percent (100%) of the deferred portion
of such Participant's Award shall be expressed in the form of Phantom Stock
Units.
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(h) INTEREST PORTION. The amount of interest credited with respect to the
portion of an Award credited to the Participant's account which is deferred and
credited with interest (the "Interest Portion") shall be equal to the amount
such portion would have earned had it been credited with interest from the last
day of the Award Period with respect to which the Award was made until the
seventh business day preceding the date as of which payment is made, compounded
annually, at the Company's rate of return on stockholders' equity for each
fiscal year that payment is deferred, or at such other rate as the Committee
may from time to time determine. The Committee may, in its sole discretion,
credit interest on amounts payable prior to the date on which the Company's
rate of return on stockholders' equity becomes ascertainable at the rate
applicable to deferred amounts during the year immediately preceding the year
of payment.
(i) PHANTOM STOCK UNIT PORTION. With respect to the portion of an Award
credited to the Participant's account which is deferred and expressed in the
form of Phantom Stock Units (the "Phantom Stock Unit Portion"), the number of
Phantom Stock Units so credited shall be equal to the result of dividing (i)
the Phantom Stock Unit Portion by (ii) the Fair Market Value on the date the
Award Period ended.
(j) DIVIDEND EQUIVALENTS. Within thirty (30) days from the payment of a
dividend by the Company on its Stock, the Phantom Stock Unit Portion of each
Participant's account shall be credited with additional Phantom Stock Units the
number of which shall be determined by (i) multiplying the dividend per share
paid on the Company's Stock by the number of Phantom Stock Units credited to
his account at the time such dividend was declared, then (ii) dividing such
amount by the Fair Market Value on the payment date for such dividend.
(k) PAYMENT OF DEFERRED AWARDS. Payment with respect to amounts credited
to the account of a Participant shall be made in a series of annual
installments over a period of ten (10) years, or such other period as the
Committee may direct, or as the Committee may allow the Participant to elect,
in either case at the time of the original deferral election. Except as
otherwise provided by the Committee, each installment shall be withdrawn
proportionately from the Interest Portion and from the Phantom Stock Unit
Portion of a Participant's account based on the percentage of the Participant's
account which he originally elected to be credited with interest and with
Phantom Stock Units, or, if a later election has been permitted by the
Committee and is then in effect, based on the percentage specified in such
later election. Payments shall commence on the date specified by the
Participant in his deferral election, unless the Committee in its sole
discretion determines that payment shall be made over a shorter period or in
more frequent installments, or commence on an earlier date, or any or all of
the above. If a Participant dies prior to the date on which payment with
respect to all amounts credited to his account shall have been completed,
payment with respect to such amounts shall be made to the Participant's
beneficiary in a series of annual installments over a period of five (5) years,
unless the Committee in its sole discretion determines that payment shall be
made over a shorter period or in more frequent installments, or both. To the
extent practicable, each installment payable hereunder shall approximate that
part of the amount then credited to the Participant's or
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<PAGE> 14
beneficiary's account which, if multiplied by the number of installments
remaining to be paid would be equal to the entire amount then credited to the
Participant's account.
(l) COMPOSITION OF PAYMENT. The Committee shall cause all payments with
respect to deferred Awards to be made in a manner such that not more than
one-half of the value of each installment shall consist of Stock. To that end,
payment with respect to the Interest Portion and the Phantom Stock Unit Portion
of a Participant's account shall be paid in cash and Stock as the Committee
shall determine in its sole discretion. The determination of any amount to be
paid in cash for Phantom Stock Units shall be made by multiplying (i) the Fair
Market Value of one share of Stock on the seventh business day prior to the
date as of which payment is made, by (ii) the number of Phantom Stock Units for
which payment is being made. The determination of the number of shares of
Stock, if any, to be distributed with respect to the Interest Portion of a
Participant's account shall be made by dividing (i) one-half of the value of
such portion on the seventh business day prior to the date as of which payment
is made, by (ii) the Fair Market Value of one share of Stock on such date.
Fractional shares shall be paid in cash.
(m) ALTERNATIVE INVESTMENT EQUIVALENTS. If the Committee shall have
permitted Participants to elect to have deferred Awards of Performance Share
Units invested in one or more hypothetical investment equivalents other than
interest or Phantom Stock Units, such deferred Awards shall be credited with
hypothetical investment earnings at such rate, manner and time as the Committee
shall determine. At the end of the deferral period, payment shall be made in
respect of such hypothetical investment equivalents in such manner and at such
time as the Committee shall determine.
(n) ADJUSTMENT OF PERFORMANCE GOALS. The Committee may, during the Award
Period, make such adjustments to Performance Goals as it may deem appropriate,
to compensate for, or reflect, any significant changes that may have occurred
during such Award Period in (i) applicable accounting rules or principles or
changes in the Company's method of accounting or in that of any other
corporation whose performance is relevant to the determination of whether an
Award has been earned or (ii) tax laws or other laws or regulations that alter
or affect the computation of the measures of Performance Goals used for the
calculation of Awards.
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10. RESTRICTED STOCK AWARDS AND PHANTOM STOCK UNITS
(a) AWARD OF RESTRICTED STOCK AND PHANTOM STOCK UNITS.
(i) The Committee shall have the authority (1) to grant
Restricted Stock and Phantom Stock Unit Awards, (2) to issue or transfer
Restricted Stock to Participants, and (3) to establish terms, conditions
and restrictions applicable to such Restricted Stock and Phantom Stock
Units, including the Restricted Period, which may differ with respect to
each grantee, the time or times at which Restricted Stock or Phantom Stock
Units shall be granted or become vested and the number of shares or units
to be covered by each grant.
(ii) The Holder of a Restricted Stock Award shall execute and
deliver to the Secretary of the Company an agreement with respect to
Restricted Stock and escrow agreement satisfactory to the Committee and
the appropriate blank stock powers with respect to the Restricted Stock
covered by such agreements. If a Participant shall fail to execute the
agreement, escrow agreement and stock powers within such period, the
Award shall be null and void. Subject to the restrictions set forth in
Section 10(b), the Holder shall generally have the rights and privileges
of a stockholder as to such Restricted Stock, including the right to vote
such Restricted Stock. At the discretion of the Committee, cash and
stock dividends with respect to the Restricted Stock may be either
currently paid or withheld by the Company for the Holder's account, and
interest may be paid on the amount of cash dividends withheld at a rate
and subject to such terms as determined by the Committee. Cash or stock
dividends so withheld by the Committee shall not be subject to
forfeiture.
(iii) In the case of a Restricted Stock Award, the Committee
shall then cause stock certificates registered in the name of the Holder
to be issued and deposited together with the stock powers with an escrow
agent to be designated by the Committee. The Committee shall cause the
escrow agent to issue to the Holder a receipt evidencing any stock
certificate held by it registered in the name of the Holder.
(iv) In the case of a Phantom Stock Units Award, no shares of
Common Stock shall be issued at the time the Award is made, and the
Company will not be required to set aside a fund for the payment of any
such Award. The Committee shall, in its sole discretion, determine
whether to credit to the account of, or to currently pay to, each Holder
of an Award of Phantom Stock Units an amount equal to the cash dividends
paid by the Company upon one share of Stock for each Phantom Stock Unit
then credited to such Holder's account ("Dividend Equivalents").
Dividend Equivalents credited to Holder's account shall be subject to
forfeiture and may bear interest at a rate and subject to such terms as
determined by the Committee.
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(b) RESTRICTIONS.
(i) Restricted Stock awarded to a Participant shall be subject
to the following restrictions until the expiration of the Restricted
Period: (1) the Holder shall not be entitled to delivery of the stock
certificate; (2) the shares shall be subject to the restrictions on
transferability set forth in the grant; (3) the shares shall be subject
to forfeiture to the extent provided in subparagraph (d) and, to the
extent such shares are forfeited, the stock certificates shall be
returned to the Company, and all rights of the Holder to such shares and
as a shareholder shall terminate without further obligation on the part
of the Company.
(ii) Phantom Stock Units awarded to any Participant shall be
subject to the following restrictions until the expiration of the
Restricted Period: (1) the units shall be subject to forfeiture to the
extend provided in subparagraph (d), and to the extent such units are
forfeited, all rights of the Holder to such units shall terminate without
further obligation on the part of the Company and (2) any other
restrictions which the Committee may determine in advance are necessary
or appropriate.
(iii) The Committee shall have the authority to remove any or
all of the restrictions on the Restricted Stock and Phantom Stock Units
whenever it may determine that, by reason of changes in applicable laws
or other changes in circumstances arising after the date of the Restricted
Stock Award or Phantom Stock Award, such action is appropriate.
(c) RESTRICTED PERIOD.
The Restricted Period of Restricted Stock and Phantom Stock Units shall
commence on the Date of Grant and shall expire from time to time as to that
part of the Restricted Stock and Phantom Stock Units indicated in a schedule
established by the Committee in the Incentive Plan Agreement.
(d) FORFEITURE PROVISIONS. In the event a Holder terminates employment
during a Restricted Period, that portion of the Award with respect to which
restrictions have not expired ("Non-Vested Portion") shall be treated as
follows.
(i) Resignation or discharge:
-- The Non-Vested Portion of the Award shall
be completely forfeited.
(ii) Normal Termination:
-- The Non-Vested Portion of the Award shall
be prorated for service during the Restricted Period and
shall be received as soon as practicable following
termination.
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(iii) Death:
-- The Non-Vested Portion of the Award shall be
prorated for service during the Restricted Period and
paid to the Participant's beneficiary as soon as
practicable following death.
(e) DELIVERY OF RESTRICTED STOCK AND SETTLEMENT OF PHANTOM STOCK UNITS.
Upon the expiration of the Restricted Period with respect to any shares of
Stock covered by a Restricted Stock Award, a stock certificate evidencing the
shares of Restricted Stock which have not then been forfeited and with respect
to which the Restricted Period has expired (to the nearest full share) shall be
delivered without charge to the Holder, or his beneficiary, free of all
restrictions under the Plan.
Upon the expiration of the Restricted Period with respect to any Phantom
Stock Units covered by a Phantom Stock Unit Award, the Company shall deliver to
the Holder or his beneficiary without any charge one share of Stock for each
Phantom Stock Unit which has not then been forfeited and with respect to which
the Restricted Period has expired ("vested unit") and cash equal to any
Dividend Equivalents credited with respect to each such vested unit and the
interest thereon, if any; provided, however, that the Committee may, in its
sole discretion, elect to pay cash or part cash and part Stock in lieu of
delivering only Stock for vested units. If cash payment is made in lieu of
delivering Stock, the amount of such payment shall be equal to the Fair Market
Value for the date on which the Restricted Period lapsed with respect to such
vested unit.
(f) SEC RESTRICTIONS. Each certificate representing Restricted Stock
awarded under the Plan shall bear the following legend:
"Transfer of this certificate and the shares represented hereby is
restricted pursuant to the terms of a Restricted Stock Agreement, dated
as of , between Inphynet Medical Management, Inc. and .
A copy of such Agreement is on file at the offices of the Company in Fort
Lauderdale, Florida."
Stop transfer orders shall be entered with the Company's transfer agent and
registrar against the transfer of legend securities except in compliance with
the Securities Act.
11. GENERAL
(a) ADDITIONAL PROVISIONS OF AN AWARD. The award of any benefit under the
Plan may also be subject to such other provisions (whether or not applicable to
the benefit awarded to any other Participant) as the Committee determines
appropriate including, without limitation, provisions to assist the Participant
in financing the purchase of Common Stock through the exercise of Options,
provisions for the forfeiture of or restrictions on resale or other disposition
of shares acquired under any form of benefit, provisions giving the Company the
right to repurchase shares acquired under any form of benefit in the event the
Participant elects to dispose
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of such shares, and provisions to comply with Federal and state securities laws
and Federal and state income tax withholding requirements.
(b) PRIVILEGES OF STOCK OWNERSHIP. Except as otherwise specifically
provided in the Plan, no person shall be entitled to the privileges of stock
ownership in respect of shares of Stock which are subject to Options or
Restricted Stock Awards, Performance Share Unit Awards or Phantom Stock Unit
Awards hereunder until such shares have been issued to that person upon
exercise of an Option according to its terms or upon sale or grant of those
shares in accordance with a Restricted Stock Award, Performance Share Unit
Award or Phantom Stock Unit Award.
(c) 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 governmental 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.
(d) TAX WITHHOLDING. Notwithstanding any other provision of the Plan, the
Company or a Subsidiary or Affiliate, as appropriate, shall have the right to
deduct from all Awards, to the extent paid in cash, all federal, state or local
taxes as required by law to be withheld with respect to such Awards and, in the
case of Awards paid in Stock, the Holder or other person receiving such Stock
may be required to pay to the Company or a Subsidiary or Affiliate, as
appropriate prior to delivery of such Stock, the amount of any such taxes which
the Company or Subsidiary is required to withhold, if any, with respect to such
Stock. Subject in particular cases to the disapproval of the Committee, the
Company may accept shares of Stock of equivalent Fair Market Value in payment
of such withholding tax obligations if the Holder of the Award elects to make
payment in such manner at least six months prior to the date such tax
obligation is determined.
(e) CLAIM TO AWARDS AND EMPLOYMENT RIGHTS. No employee or other person
shall have any claim or right to be granted an Award under the Plan nor, having
been selected for the grant of an Award, to be selected for a grant of any
other Award. Neither this Plan nor any action taken hereunder shall be
construed as giving any Participant any right to be retained in the employ of
the Company or a Subsidiary or Affiliate.
(f) DESIGNATION AND CHANGE OF BENEFICIARY. Each Participant shall file
with the Committee a written designation of one or more persons as the
beneficiary who shall be entitled to receive the amounts payable with respect
to an Award of Performance Share Units, Phantom Share Units or Restricted
Stock, if any, due under the Plan upon his death. A Participant may, from time
to time, revoke or change his beneficiary designation without the consent of
any prior beneficiary by filing a new designation with the Committee. The last
such designation received by the Committee shall be controlling; provided,
however, that no designation, or change or revocation thereof, shall be
effective unless received by the Committee prior to the Participant's death,
and in no event shall it be effective as of a date prior to such receipt.
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(g) PAYMENTS TO PERSONS OTHER THAN PARTICIPANTS. If the Committee shall
find that any person to whom any amount is payable under the Plan is unable to
care for his affairs because of illness or accident, or is a minor, or has
died, then any payment due to such person or his estate (unless a prior claim
therefor has been made by a duly appointed legal representative), may, if the
Committee so directs the Company, be paid to his spouse, child, relative, an
institution maintaining or having custody of such person, or any other person
deemed by the Committee to be a proper recipient on behalf of such person
otherwise entitled to payment. Any such payment shall be a complete discharge
of the liability of the Committee and the Company therefor.
(h) NO LIABILITY OF COMMITTEE MEMBERS. No member of the Committee shall
be personally liable by reason of any contract or other instrument executed by
such member or on his behalf in his capacity as a member of the Committee nor
for any mistake of judgment made in good faith, and the Company shall indemnify
and hold harmless each member of the Committee and each other employee, officer
or director of the Company to whom any duty or power relating to the
administration or interpretation of the Plan may be allocated or delegated,
against any cost or expense (including counsel fees) or liability (including
any sum paid in settlement of a claim) arising out of any act or omission to
act in connection with the Plan unless arising out of such person's own fraud
or bad faith; provided, however, that approval of the Board shall be required
for the payment of any amount in settlement of a claim against any such person.
The foregoing right of indemnification shall not be exclusive of any other
rights of indemnification to which such persons may be entitled under the
Company's Articles of Incorporation or By-Laws, as a matter of law, or
otherwise, or any power that the Company may have to indemnify them or hold
them harmless.
(i) GOVERNING LAW. The Plan shall be governed by and construed in
accordance with the internal laws of the State of Florida without reference to
the principles of conflicts of law thereof.
(j) FUNDING. Except as provided under Section 10, no provision of the
Plan shall require the Company, for the purpose of satisfying any obligations
under the Plan, to purchase assets or place any assets in a trust or other
entity to which contributions are made or otherwise to segregate any assets,
nor shall the Company maintain separate bank accounts, books, records or other
evidence of the existence of a segregated or separately maintained or
administered fund for such purposes. Holders shall have no rights under the
Plan other than as unsecured general creditors of the Company, except that
insofar as they may have become entitled to payment of additional compensation
by performance of services, they shall have the same rights as other employees
under general law.
(k) NONTRANSFERABILITY. A person's rights and interest under the Plan,
including amounts payable, may not be sold, assigned, donated, or transferred
or otherwise disposed of, mortgaged, pledged or encumbered except, in the event
of a Holder's death, to a designated beneficiary to the extent permitted by the
Plan, or in the absence of such designation, by will or the laws of descent and
distribution.
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(l) RELIANCE ON REPORTS. Each member of the Committee and each member of
the Board shall be fully justified in relying, acting or failing to act, and
shall not be liable for having so relied, acted or failed to act in good faith,
upon any report made by the independent public accountant of the Company and
its Subsidiaries or Affiliates and upon any other information furnished in
connection with the Plan by any person or persons other than himself.
(m) RELATIONSHIP TO OTHER BENEFITS. No payment under the Plan shall be
taken into account in determining any benefits under any pension, retirement,
profit sharing, group insurance or other benefit plan of the Company or any
Subsidiary or Affiliate except as otherwise specifically provided.
(n) EXPENSES. The expenses of administering the Plan shall be borne by
the Company and its Subsidiaries and Affiliates.
(o) PRONOUNS. Masculine pronouns and other words of masculine gender
shall refer to both men and women.
(p) 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.
12. CHANGES IN CAPITAL STRUCTURE
Options, SARs, Restricted Stock Awards, Phantom Stock Unit Awards,
Performance Share Unit Awards, and any agreements evidencing such Awards, and
Performance Goals, shall be subject to adjustment or substitution, as
determined by the Committee in its sole discretion, as to the number, price or
kind of a share of Stock or other consideration subject to such Awards or as
otherwise determined by the Committee to be equitable (i) in the event of
changes in the outstanding Stock or in the capital structure of the Company, or
of any other corporation whose performance is relevant to the attainment of
Performance Goals hereunder, by reason of stock dividends, stock splits,
recapitalizations, reorganizations, mergers, consolidations, combinations,
exchanges, or other relevant changes in capitalization occurring after the Date
of Grant of any such Award or (ii) in the event of any change in applicable
laws or any change in circumstances which results in or would result in any
substantial dilution or enlargement of the rights granted to, or available for,
Participants in the Plan, or which otherwise warrants equitable adjustment
because it interferes with the intended operation of the Plan. In addition, in
the event of any such adjustments or substitution, the aggregate number of
shares of Stock available under the Plan shall be appropriately adjusted by the
Committee, whose determination shall be conclusive. Any adjustment in
Incentive Stock Options under this Section 12 shall be made only to the extent
not constituting a "modification" within the meaning of Section 424(h)(3) of
the Code, and any adjustments under this Section 12 shall be made in a manner
which does not adversely affect the exemption provided pursuant to Rule 16b-3
under the Exchange Act. The Company shall give each Participant notice of an
adjustment hereunder and, upon notice, such adjustment shall be conclusive and
binding for all purposes.
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13. EFFECT OF CHANGE IN CONTROL
(a) In the event of a Change in Control, notwithstanding any vesting
schedule provided for hereunder or by the Committee with respect to an Award of
Options, SARs, Phantom Stock Units or Restricted Stock, such Option or SAR
shall become immediately exercisable with respect to 100 percent of the shares
subject to such Option or SAR, and the Restricted Period shall expire
immediately with respect to 100 percent of the Phantom Stock Units or shares of
Restricted Stock subject to Restrictions; provided, however, that to the extent
that so accelerating the time an Incentive Stock Option may first be exercised
would cause the limitation provided in Section 7(f) to be exceeded, such
Options shall instead first become exercisable in so many of the next following
years as is necessary to comply with such limitation.
(b) In the event of a Change in Control, all incomplete Award Periods in
effect on the date the Change in Control occurs shall end on the date of such
change, and the Committee shall, (i) determine the extent to which Performance
Goals with respect to each such Award Period have been met based upon such
audited or unaudited financial information then available as it deems relevant,
(ii) cause to be paid to each Participant partial or full Awards with respect
to Performance Goals for each such Award Period based upon the Committee's
determination of the degree of attainment of Performance Goals, and (iii) cause
all previously deferred Awards to be settled in full as soon as possible.
(c) The obligations of the Company under the Plan shall be binding upon
any successor corporation or organization resulting from the merger,
consolidation or other reorganization of the Company, or upon any successor
corporation or organization succeeding to substantially all of the assets and
business of the Company. The Company agrees that it will make appropriate
provisions for the preservation of Participant's rights under the Plan in any
agreement or plan which it may enter into or adopt to effect any such merger,
consolidation, reorganization or transfer of assets.
14. NONEXCLUSIVITY OF THE PLAN
Neither the adoption of this Plan by the Board nor the submission of this
Plan to the stockholders of the Company for approval shall be construed as
creating any limitations on the power of the Board to adopt such other
incentive arrangements as it may deem desirable, including, without limitation,
the granting of stock options otherwise than under this Plan, and such
arrangements may be either applicable generally or only in specific cases.
15. AMENDMENTS AND TERMINATION
The Board may at any time terminate the Plan. With the express written
consent of an individual Participant, the Board may cancel or reduce or
otherwise alter the outstanding Awards thereunder if, in its judgment, the tax,
accounting, or other effects of the Plan or potential payouts thereunder would
not be in the best interest of the Company. The Board may, at any time, or
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from time to time, amend or suspend and, if suspended, reinstate, the Plan in
whole or in part, provided, however, that without further stockholder approval
the Board shall not:
(a) Increase the maximum number of shares of Stock which may be
issued on exercise of Options, SARs, or pursuant to Restricted Stock
Awards, Phantom Stock Unit Awards, or Performance Share Unit Awards,
except as provided in Section 12;
(b) Change the maximum Option Price;
(c) Extend the maximum Option term;
(d) Extend the termination date of the Plan; or
(e) Change the class of persons eligible to receive Awards under the
Plan.
16. EFFECT OF SECTION 162(M) OF THE CODE
The Plan, and all Awards issued thereunder, are intended to be exempt from
the application of Section 162(m) of the Code, which restricts under certain
circumstances the Federal income tax deduction for compensation paid by a
public company to named executives in excess of $1 million per year. This
exemption is based on Proposed Treasury Regulation Section 1.162-27(f), as in
effect at the time of the adoption of the Plan, with the understanding that
such regulation generally exempts from the application of Section 162(m) of the
Code compensation paid pursuant to a plan that existed before a company becomes
publicly held. The Committee may, without shareholder approval, amend the Plan
retroactively and/or prospectively to the extent it determines necessary in
order to comply with any subsequent clarification of Section 162(m) of the Code
required to preserve the Company's Federal income tax deduction for
compensation paid pursuant to the Plan.
* * *
As adopted by the Board of Directors of
Inphynet Medical Management Inc.
as of May 7, 1994 and amended as of May 16, 1996.
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