SEC Filings

10-12G
AMSURG CORP filed this Form 10-12G on 03/11/1997
Entire Document
 


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                                                                    EXHIBIT 10.8


                                  AMSURG CORP.
                           1997 STOCK INCENTIVE PLAN


SECTION 1.  PURPOSE; DEFINITIONS.

         The purpose of the AmSurg Corp. 1997 Stock Incentive Plan (the "Plan")
is to enable AmSurg Corp., a Tennessee corporation (the "Corporation") to
attract, retain and reward key employees of and consultants to the Corporation
and its Subsidiaries and Affiliates, and directors who are not also employees
of the Corporation, and to strengthen the mutuality of interests between such
key employees, consultants, and directors by awarding such key employees,
consultants, and directors performance-based stock incentives and/or other
equity interests or equity-based incentives in the Corporation, as well as
performance-based incentives payable in cash.  The creation of the Plan shall
not diminish or prejudice other compensation programs approved from time to
time by the Board.

         For purposes of the Plan, the following terms shall be defined as set
forth below:

         A.      "Affiliate" means any entity other than the Corporation and
its Subsidiaries that is designated by the Board as a participating employer
under the Plan, provided that the Corporation directly or indirectly owns at
least 20% of the combined voting power of all classes of
 stock of such entity
or at least 20% of the ownership interests in such entity.

         B.      "Board" means the Board of Directors of the Corporation.

         C.      "Cause" has the meaning provided in Section 5(j) of the Plan.

         D.      "Change in Control" has the meaning provided in Section 10(b)
of the Plan.

         E.      "Change in Control Price" has the meaning provided in Section
10(d) of the Plan.

         F.      "Common Stock" means (i) prior to the Distribution, the
Corporation's Common Stock, without par value, and (ii) following the
Distribution, the Corporation's Class A Common Stock, without par value.

         G.      "Code" means the Internal Revenue Code of 1986, as amended
from time to time, and any successor thereto.

         H.      "Committee" means the Committee referred to in Section 2 of
the Plan.

         I.      "Corporation" means AmSurg Corp., a corporation organized
under the laws of the State of Tennessee or any successor corporation.

         J.      "Disability" means disability as determined in accordance with
Corporation's policies in effect from time to time.

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         K.      "Distribution" means the Distribution contemplated by that
certain Distribution Agreement, dated as of March __, 1997, by and between
American Healthcorp, Inc. and the Corporation.

         L.      "Early Retirement" means retirement, for purposes of this Plan
with the express consent of the Corporation at or before the time of such
retirement, from active employment with the Corporation and any Subsidiary or
Affiliate prior to age 65, in accordance with any applicable early retirement
policy of the Corporation then in effect or as may be approved by the
Committee.

         M.      "Effective Date" has the meaning provided in Section 14 of the
Plan.

         N.      "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor thereto.

         O.      "Fair Market Value" means with respect to the Common Stock, as
of any given date or dates, unless otherwise determined by the Committee in
good faith, the reported closing price of a share of Common Stock on The Nasdaq
Stock Market National Market or such other market or exchange as is the
principal trading market for the Common Stock, or, if no such sale of a share
of Common Stock is reported on The Nasdaq Stock Market National Market or other
exchange or principal trading market on such date, the fair market value of a
share of Common Stock as determined by the Committee in good faith.

         P.      "Incentive Stock Option" means any Stock Option intended to be
and designated as an "Incentive Stock Option" within the meaning of Section 422
of the Code.

         Q.      "Immediate Family" means any child, stepchild, grandchild,
parent, stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law, or sister-in-law, and shall
include adoptive relationships.

         R.      "Non-Employee Director" means a member of the Board who is a
Non-Employee Director within the meaning of Rule 16b-3(b)(3) promulgated under
the Exchange Act and an outside director within the meaning of Treasury
Regulation Sec. 162-27(e)(3) promulgated under the Code.

         S.      "Non-Qualified Stock Option" means any Stock Option that is
not an Incentive Stock Option.

         T.      "Normal Retirement" means retirement from active employment
with the Corporation and any Subsidiary or Affiliate on or after age 65.

         U.      "Other Stock-Based Award" means an award under Section 8 below
that is valued in whole or in part by reference to, or is otherwise based on,
the Common Stock.





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         V.      "Outside Director" means a member of the Board who is not an
officer or employee of the Corporation or any Subsidiary or Affiliate of the
Corporation.  A Board member who serves as a medical director but is not either
an officer or employee will be deemed to be an Outside Director.

         W.      "Outside Director Restricted Stock" means an award to an
Outside Director under Section 9 below.

         X.      "Plan" means this 1997 Stock Incentive Plan, as amended from
time to time.

         Y.      "Restricted Stock" means an award of shares of Common Stock
that is subject to restrictions under Section 7 of the Plan.

         Z.      "Restriction Period" has the meaning provided in Section 7 of
the Plan.

         AA.     "Retirement" means Normal or Early Retirement.

         BB.     "Section 162(m) Maximum" has the meaning provided in Section
3(a) hereof.

         CC.     "Stock Appreciation Right" means the right pursuant to an
award granted under Section 6 below to surrender to the Corporation all (or a
portion) of a Stock Option in exchange for an amount equal to the difference
between (i) the Fair Market Value, as of the date such Stock Option (or such
portion thereof) is surrendered, of the shares of Common Stock covered by such
Stock Option (or such portion thereof), subject, where applicable, to the
pricing provisions in Section 6(b)(ii), and (ii) the aggregate exercise price
of such Stock Option (or such portion thereof).

         DD.     "Stock Option" or "Option" means any option to purchase shares
of Common Stock (including Restricted Stock, if the Committee so determines)
granted pursuant to Section 5 below.

         EE.     "Subsidiary" means any corporation (other than the
Corporation) in an unbroken chain of corporations beginning with the
Corporation if each of the corporations (other than the last corporation in the
unbroken chain) owns stock possessing 50% or more of the total combined voting
power of all classes of stock in one of the other corporations in the chain.


SECTION 2.  ADMINISTRATION.

         The Plan shall be administered by a Committee of not less than two
Non-Employee Directors, who shall be appointed by the Board and who shall serve
at the pleasure of the Board.  Decisions of the Committee may be ratified by
the Board. The functions of the Committee specified in the Plan may be
exercised by an existing Committee of the Board composed exclusively of
Non-Employee Directors.  The initial Committee shall be the Compensation
Committee of the Board.





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         The Committee shall have authority to grant, pursuant to the terms of
the Plan, to officers, other key employees, Outside Directors and consultants
eligible under Section 4: (i) Stock Options, (ii) Stock Appreciation Rights,
(iii) Restricted Stock, and/or (iv) Other Stock-Based Awards; provided,
however, that the power to grant and establish the terms and conditions of
awards to Outside Directors under the Plan other than pursuant to Section 9
shall be reserved to the Board.

         In particular, the Committee, or the Board, as the case may be, shall
have the authority, consistent with the terms of the Plan:

                 (a)  to select the officers, key employees and Outside
         Directors of and consultants to the Corporation and its Subsidiaries
         and Affiliates to whom Stock Options, Stock Appreciation Rights,
         Restricted Stock, and/or Other Stock-Based Awards may from time to
         time be granted hereunder;

                 (b)  to determine whether and to what extent Incentive Stock
         Options, Non-Qualified Stock Options, Stock Appreciation Rights,
         Restricted Stock, and/or Other Stock-Based Awards, or any combination
         thereof, are to be granted hereunder to one or more eligible persons;

                 (c)  to determine the number of shares to be covered by each
         such award granted hereunder;

                 (d)  to determine the terms and conditions, not inconsistent
         with the terms of the Plan, of any award granted hereunder (including,
         but not limited to, the share price and any restriction or limitation,
         or any vesting acceleration or waiver of forfeiture restrictions
         regarding any Stock Option or other award and/or the shares of Common
         Stock relating thereto, based in each case on such factors as the
         Committee shall determine, in its sole discretion); and to amend or
         waive any such terms and conditions to the extent permitted by Section
         11 hereof;

                 (e)  to determine whether and under what circumstances a Stock
         Option may be settled in cash or Restricted Stock under Section 5(m)
         or (n), as applicable, instead of Common Stock;

                 (f)  to determine whether, to what extent, and under what
         circumstances Option grants and/or other awards under the Plan are to
         be made, and operate, on a tandem basis vis-a-vis other awards under
         the Plan and/or cash awards made outside of the Plan;

                 (g)  to determine whether, to what extent, and under what
         circumstances shares of Common Stock and other amounts payable with
         respect to an award under this Plan shall be deferred either
         automatically or at the election of the participant (including
         providing for and determining the amount (if any) of any deemed
         earnings on any deferred amount during any deferral period);





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                 (h)  to determine whether to require payment of tax
         withholding requirements in shares of Common Stock subject to the
         award; and

                 (i)  to impose any holding period required to satisfy Section
         16 under the Exchange Act.

         The Committee shall have the authority to adopt, alter, and repeal
such rules, guidelines, and practices governing the Plan as it shall, from time
to time, deem advisable; to interpret the terms and provisions of the Plan and
any award issued under the Plan (and any agreements relating thereto); and to
otherwise supervise the administration of the Plan.

         All decisions made by the Committee pursuant to the provisions of the
Plan shall be subject to ratification by the Board, which shall act only on the
recommendation of the Committee as to all matters as to which the Committee has
discretion pursuant to the provisions of the Plan.  Subject to such
ratification, the decisions of the Committee shall be final and binding on all
persons, including the Corporation and Plan participants.


SECTION 3.  SHARES OF COMMON STOCK SUBJECT TO PLAN.

         (a)     As of the Effective Date, the aggregate number of shares of
Common Stock that may be issued under the Plan shall be 1,950,000 shares.  The
shares of Common Stock issuable under the Plan may consist, in whole or in
part, of authorized and unissued shares or treasury shares.  No officer of the
Corporation or other person whose compensation may be subject to the
limitations on deductibility under Section 162(m) of the Code shall be eligible
to receive awards pursuant to this Plan relating to in excess of 600,000 shares
of Common Stock in any fiscal year (the "Section 162(m) Maximum").

         (b)     If any shares of Common Stock that have been optioned cease to
be subject to a Stock Option, or if any shares of Common Stock that are subject
to any Restricted Stock or Other Stock-Based Award granted hereunder are
forfeited prior to the payment of any dividends, if applicable, with respect to
such shares of Common Stock, or any such award otherwise terminates without a
payment being made to the participant in the form of Common Stock, such shares
shall again be available for distribution in connection with future awards
under the Plan.

         (c)     In the event of any merger, reorganization, consolidation,
recapitalization, extraordinary cash dividend, stock dividend, stock split or
other change in corporate structure affecting the Common Stock, an appropriate
substitution or adjustment shall be made in the maximum number of shares that
may be awarded under the Plan, in the number and option price of shares
subject to outstanding Options granted under the Plan, in the number of shares
underlying grants of Restricted Stock and Outside Director Restricted Stock,
the Section 162(m) Maximum and in the number of shares subject to other
outstanding awards granted under the Plan as may be determined to be
appropriate by the Committee, in its sole discretion, provided that the number
of shares subject





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to any award shall always be a whole number.  An adjusted option price shall
also be used to determine the amount payable by the Corporation upon the
exercise of any Stock Appreciation Right associated with any Stock Option.


SECTION 4.  ELIGIBILITY.

         Officers, other key employees and Outside Directors of and consultants
to the Corporation and its Subsidiaries and Affiliates who are responsible for
or contribute to the management, growth and/or profitability of the business of
the Corporation and/or its Subsidiaries and Affiliates are eligible to be
granted awards under the Plan.  Outside Directors are eligible to receive
awards pursuant to Section 9 and as otherwise determined by the Board.

SECTION 5.  STOCK OPTIONS.

         Stock Options may be granted alone, in addition to, or in tandem with
other awards granted under the Plan and/or cash awards made outside of the
Plan.  Any Stock Option granted under the Plan shall be in such form as the
Committee may from time to time approve.

         Stock Options granted under the Plan may be of two types:  (i)
Incentive Stock Options and (ii) Non-Qualified Stock Options.  Incentive Stock
Options may be granted only to individuals who are employees of the Corporation
or any Subsidiary of the Corporation.

         The Committee shall have the authority to grant to any optionee
Incentive Stock Options, Non-Qualified Stock Options, or both types of Stock
Options (in each case with or without Stock Appreciation Rights).

         Options granted to officers, key employees, Outside Directors and
consultants under the Plan shall be subject to the following terms and
conditions and shall contain such additional terms and conditions, not
inconsistent with the terms of the Plan, as the Committee shall deem desirable.

                 (a)          Option Price.  The option price per share of
         Common Stock purchasable under a Stock Option shall be determined by
         the Committee at the time of grant but shall be not less than 100%
         (or, in the case of any employee who owns stock possessing more than
         10% of the total combined voting power of all classes of stock of the
         Corporation or of any of its Subsidiaries, not less than 110%) of the
         Fair Market Value of the Common Stock at grant, in the case of
         Incentive Stock Options, and not less than 50% of the Fair Market
         Value of the Common Stock at grant, in the case of Non-Qualified Stock
         Options.

                 (b)          Option Term.  The term of each Stock Option shall
         be fixed by the Committee, but no Incentive Stock Option shall be
         exercisable more than ten years (or, in the case of an employee who
         owns stock possessing more than 10% of the total combined voting





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         power of all classes of stock of the Corporation or any of its
         Subsidiaries or parent corporations, more than five years) after the
         date the Option is granted.

                 (c)          Exercisability.  Stock Options shall be
         exercisable at such time or times and subject to such terms and
         conditions as shall be determined by the Committee at or after grant;
         provided, however, that except as provided in Section 5(g) and (h) and
         Section 10, unless otherwise determined by the Committee at or after
         grant, no Stock Option shall be exercisable prior to the first
         anniversary date of the granting of the Option.  The Committee may
         provide that a Stock Option shall vest over a period of future service
         at a rate specified at the time of grant, or that the Stock Option is
         exercisable only in installments.  If the Committee provides, in its
         sole discretion, that any Stock Option is exercisable only in
         installments, the Committee may waive such installment exercise
         provisions at any time at or after grant, in whole or in part, based
         on such factors as the Committee shall determine in its sole
         discretion.

                 (d)          Method of Exercise.  Subject to whatever
         installment exercise restrictions apply under Section 5(c) , Stock
         Options may be exercised in whole or in part at any time during the
         option period, by giving written notice of exercise to the Corporation
         specifying the number of shares to be purchased.  Such notice shall be
         accompanied by payment in full of the purchase price, either by check,
         note, or such other instrument as the Committee may accept.  As
         determined by the Committee, in its sole discretion, at or (except in
         the case of an Incentive Stock Option) after grant, payment in full or
         in part may also be made in the form of shares of Common Stock already
         owned by the optionee or, in the case of a Non-Qualified Stock Option,
         shares of Restricted Stock or shares subject to such Option or another
         award hereunder (in each case valued at the Fair Market Value of the
         Common Stock on the date the Option is exercised).  If payment of the
         exercise price is made in part or in full with Common Stock, the
         Committee may award to the employee a new Stock Option to replace the
         Common Stock which was surrendered.  If payment of the option exercise
         price of a Non-Qualified Stock Option is made in whole or in part in
         the form of Restricted Stock, such Restricted Stock (and any
         replacement shares relating thereto) shall remain (or be) restricted
         in accordance with the original terms of the Restricted Stock award in
         question, and any additional Common Stock received upon the exercise
         shall be subject to the same forfeiture restrictions, unless otherwise
         determined by the Committee, in its sole discretion, at or after
         grant.  No shares of Common Stock shall be issued until full payment
         therefor has been made.  An optionee shall generally have the rights
         to dividends or other rights of a shareholder with respect to shares
         subject to the Option when the optionee has given written notice of
         exercise, has paid in full for such shares, and, if requested, has
         given the representation described in Section 13(a).

                 (e)          Transferability of Options.  No Non-Qualified
         Stock Option shall be transferable by the optionee without the prior
         written consent of the Committee other than (i) transfers by the
         Optionee to a member of his or her Immediate Family or a trust for the
         benefit of the optionee or a member of his or her Immediate Family, or
         (ii) transfers by will





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         or by the laws of descent and distribution.  No Incentive Stock Option
         shall be transferable by the optionee otherwise than by will or by the
         laws of descent and distribution and all Incentive Stock Options shall
         be exercisable, during the optionee's lifetime, only by the optionee.

                 (f)          Bonus for Taxes.  In the case of a Non-Qualified
         Stock Option or an optionee who elects to make a disqualifying
         disposition (as defined in Section 422(a)(1) of the Code) of Common
         Stock acquired pursuant to the exercise of an Incentive Stock Option,
         the Committee in its discretion may award at the time of grant or
         thereafter the right to receive upon exercise of such Stock Option a
         cash bonus calculated to pay part or all of the federal and state, if
         any, income tax incurred by the optionee upon such exercise.

                 (g)          Termination by Death.  Subject to Section 5(k),
         if an optionee's employment by the Corporation and any Subsidiary or
         (except in the case of an Incentive Stock Option) Affiliate terminates
         by reason of death, any Stock Option held by such optionee may
         thereafter be exercised, to the extent such option was exercisable at
         the time of death or (except in the case of an Incentive Stock Option)
         on such accelerated basis as the Committee may determine at or after
         grant (or except in the case of an Incentive Stock Option, as may be
         determined in accordance with procedures established by the Committee)
         by the legal representative of the estate or by the legatee of the
         optionee under the will of the optionee, for a period of one year (or
         such other period as the Committee may specify at or after grant) from
         the date of such death or until the expiration of the stated term of
         such Stock Option, whichever period is the shorter.

                 (h)          Termination by Reason of Disability.  Subject to
         Section 5(k), if an optionee's employment by the Corporation and any
         Subsidiary or (except in the case of an Incentive Stock Option)
         Affiliate terminates by reason of Disability, any Stock Option held by
         such optionee may thereafter be exercised by the optionee, to the
         extent it was exercisable at the time of termination or (except in the
         case of an Incentive Stock Option) on such accelerated basis as the
         Committee may determine at or after grant (or, except in the case of
         an Incentive Stock Option, as may be determined in accordance with
         procedures established by the Committee), for a period of (i) three
         years (or such other period as the Committee may specify at or after
         grant) from the date of such termination of employment or until the
         expiration of the stated term of such Stock Option, whichever period
         is the shorter, in the case of a Non-Qualified Stock Option and (ii)
         one year from the date of termination of employment or until the
         expiration of the stated term of such Stock Option, whichever period
         is shorter, in the case of an Incentive Stock Option; provided
         however, that, if the optionee dies within the period specified in (i)
         above (or other such period as the committee shall specify at or after
         grant), any unexercised Non-Qualified Stock Option held by such
         optionee shall thereafter be exercisable to the extent to which it was
         exercisable at the time of death for a period of twelve months from
         the date of such death or until the expiration of the stated term of
         such Stock Option, whichever period is shorter.  In the event of
         termination of employment by reason of Disability, if an Incentive
         Stock Option is exercised after the





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         expiration of the exercise period applicable to Incentive Stock
         Options, but before the expiration of any period that would apply if
         such Stock Option were a Non-Qualified Stock Option, such Stock Option
         will thereafter be treated as a Non-Qualified Stock Option.

                 (i)          Termination by Reason of Retirement.  Subject to
         Section 5(k), if an optionee's employment by the Corporation and any
         Subsidiary or (except in the case of an Incentive Stock Option)
         Affiliate terminates by reason of Normal or Early Retirement, any
         Stock Option held by such optionee may thereafter be exercised by the
         optionee, to the extent it was exercisable at the time of such
         Retirement or (except in the case of an Incentive Stock Option) on
         such accelerated basis as the Committee may determine at or after
         grant (or, except in the case of an Incentive Stock Option, as may be
         determined in accordance with procedures established by the
         Committee), for a period of (i) three years (or such other period as
         the Committee may specify at or after grant) from the date of such
         termination of employment or the expiration of the stated term of such
         Stock Option, whichever period is the shorter, in the case of a
         Non-Qualified Stock Option and (ii) three months from the date of such
         termination of employment or the expiration of the stated term of such
         Stock Option, whichever period is the shorter, in the event of an
         Incentive Stock Option; provided however, that, if the optionee dies
         within the period specified in (i) above (or other such period as the
         Committee shall specify at or after grant), any unexercised
         Non-Qualified Stock Option held by such optionee shall thereafter be
         exercisable to the extent to which it was exercisable at the time of
         death for a period of twelve months from the date of such death or
         until the expiration of the stated term of such Stock Option,
         whichever period is shorter. In the event of termination of employment
         by reason of Retirement, if an Incentive Stock Option is exercised
         after the expiration of the exercise period applicable to Incentive
         Stock Options,  but before the expiration of the period that would
         apply if such Stock Option were a Non-Qualified Stock Option, the
         option will thereafter be treated as a Non-Qualified Stock Option.

                 (j)          Other Termination.  Subject to Section 5(k),
         unless otherwise determined by the Committee (or pursuant to
         procedures established by the Committee) at or (except in the case of
         an Incentive Stock Option) after grant, if an optionee's employment by
         the Corporation and any Subsidiary or (except in the case of an
         Incentive Stock Option) Affiliate is involuntarily terminated for any
         reason other than death, Disability or Normal or Early Retirement, the
         Stock Option shall thereupon terminate, except that such Stock Option
         may be exercised, to the extent otherwise then exercisable, for the
         lesser of three months or the balance of such Stock Option's term if
         the involuntary termination is without Cause.  For purposes of this
         Plan, "Cause" means (i) a felony conviction of a participant or the
         failure of a participant to contest prosecution for a felony, or (ii)
         a participant's willful misconduct or dishonesty, which is directly
         and materially harmful to the business or reputation of the
         Corporation or any Subsidiary or Affiliate.  If an optionee
         voluntarily terminates employment with the Corporation and any
         Subsidiary or (except in the case of an Incentive Stock Option)
         Affiliate (except for Disability, Normal or Early Retirement), the
         Stock Option shall thereupon terminate; provided, however, that the
         Committee at grant or (except in the case





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         of an Incentive Stock Option) thereafter may extend the exercise
         period in this situation for the lesser of three months or the balance
         of such Stock Option's term.

                 (k)          Incentive Stock Options.  Anything in the Plan to
         the contrary notwithstanding, no term of this Plan relating to
         Incentive Stock Options shall be interpreted, amended, or altered, nor
         shall any discretion or authority granted under the Plan be so
         exercised, so as to disqualify the Plan under Section 422 of the Code,
         or, without the consent of the optionee(s) affected, to disqualify any
         Incentive Stock Option under such Section 422.  No Incentive Stock
         Option shall be granted to any participant under the Plan if such
         grant would cause the aggregate Fair Market Value (as of the date the
         Incentive Stock Option is granted) of the Common Stock with respect to
         which all Incentive Stock Options are exercisable for the first time
         by such participant during any calendar year (under all such plans of
         the Company and any Subsidiary) to exceed $100,000.  To the extent
         permitted under Section 422 of the Code or the applicable regulations
         thereunder or any applicable Internal Revenue Service pronouncement:

                              (i)  if (x) a participant's employment is
                 terminated by reason of death, Disability, or Retirement and
                 (y) the portion of any Incentive Stock Option that is
                 otherwise exercisable during the post-termination period
                 specified under Section 5(g), (h) or (i), applied without
                 regard to the $100,000 limitation contained in Section 422(d)
                 of the Code, is greater than the portion of such Option that
                 is immediately exercisable as an "Incentive Stock Option"
                 during such post-termination period under Section 422, such
                 excess shall be treated as a Non-Qualified Stock Option; and

                              (ii) if the exercise of an Incentive Stock
                 Option is accelerated by reason of a Change in Control, any
                 portion of such Option that is not exercisable as an Incentive
                 Stock Option by reason of the $100,000 limitation contained in
                 Section 422(d) of the Code shall be treated as a Non-Qualified
                 Stock Option.

                 (l)          Buyout Provisions.  The Committee may at any time
         offer to buy out for a payment in cash, Common Stock, or Restricted
         Stock an Option previously granted, based on such terms and conditions
         as the Committee shall establish and communicate to the optionee at
         the time that such offer is made.

                 (m)          Settlement Provisions.  If the option agreement
         so provides at grant or (except in the case of an Incentive Stock
         Option) is amended after grant and prior to exercise to so provide
         (with the optionee's consent), the Committee may require that all or
         part of the shares to be issued with respect to the spread value of an
         exercised Option take the form of Restricted Stock, which shall be
         valued on the date of exercise on the basis of the Fair Market Value
         (as determined by the Committee) of such Restricted Stock determined
         without regards to the forfeiture restrictions involved.





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                 (n)          Performance and Other Conditions.  The
                 Committee may condition the exercise of any Option upon the
                 attainment of specified performance goals or other factors as
                 the Committee may determine, in its sole discretion.  Unless
                 specifically provided in the option agreement, any such
                 conditional Option shall vest immediately prior to its
                 expiration if the conditions to exercise have not theretofore
                 been satisfied.

SECTION 6.  STOCK APPRECIATION RIGHTS.

                 (a)          Grant and Exercise.  Stock Appreciation Rights
         may be granted in conjunction with all or part of any Stock Option
         granted under the Plan.  In the case of a Non-Qualified Stock Option,
         such rights may be granted either at or after the time of the grant of
         such Stock Option.  In the case of an Incentive Stock Option, such
         rights may be granted only at the time of the grant of such Stock
         Option.  A Stock Appreciation Right or applicable portion thereof
         granted with respect to a given Stock Option shall terminate and no
         longer be exercisable upon the termination or exercise of the related
         Stock Option, subject to such provisions as the Committee may specify
         at grant where a Stock Appreciation Right is granted with respect to
         less than the full number of shares covered by a related Stock Option.
         A Stock Appreciation Right may be exercised by an optionee, subject to
         Section 6(b), in accordance with the procedures established by the
         Committee for such purpose.  Upon such exercise, the optionee shall be
         entitled to receive an amount determined in the manner prescribed in
         Section 6(b).  Stock Options relating to exercised Stock Appreciation
         Rights shall no longer be exercisable to the extent that the related
         Stock Appreciation Rights have been exercised.

                 (b)          Terms and Conditions.  Stock Appreciation Rights
         shall be subject to such terms and conditions, not inconsistent with
         the provisions of the Plan, as shall be determined from time to time
         by the Committee, including the following:

                          (i) Stock Appreciation Rights shall be
                 exercisable only at such time or times and to the extent that
                 the Stock Options to which they relate shall be exercisable in
                 accordance with the provisions of Section 5 and this Section 6
                 of the Plan.

                         (ii) Upon the exercise of a Stock Appreciation
                 Right, an optionee shall be entitled to receive an amount in
                 cash and/or shares of Common Stock equal in value to the
                 excess of the Fair Market Value of one share of Common Stock
                 over the option price per share specified in the related Stock
                 Option multiplied by the number of shares in respect of which
                 the Stock Appreciation Right shall have been exercised, with
                 the Committee having the right to determine the form of
                 payment.  When payment is to be made in shares, the number of
                 shares to be paid shall be calculated on the basis of the Fair
                 Market Value of the shares on the date of exercise.  When
                 payment is to be made in cash, such amount shall be calculated
                 on the basis of the Fair Market Value of the Common Stock on
                 the date of exercise.





                                       11

<PAGE>   12

                          (iii)   Stock Appreciation Rights shall be
                 transferable only when and to the extent that the underlying
                 Stock Option would be transferable under Section 5(e) of the
                 Plan.

                          (iv)    Upon the exercise of a Stock Appreciation
                 Right, the Stock Option or part thereof to which such Stock
                 Appreciation Right is related shall be deemed to have been
                 exercised for the purpose of the limitation set forth in
                 Section 3 of the Plan on the number of shares of Common Stock
                 to be issued under the Plan.

                          (v)     The Committee, in its sole discretion, may 
                 also provide that, in the event of a Change in Control
                 and/or a Potential Change in Control, the amount to be paid
                 upon the exercise of a Stock Appreciation Right shall be based
                 on the Change in Control Price, subject to such terms and
                 conditions as the Committee may specify at grant.

                          (vi)    The Committee may condition the exercise of
                 any Stock Appreciation Right upon the attainment of specified
                 performance goals or other factors as the Committee may
                 determine, in its sole discretion.

SECTION 7.  RESTRICTED STOCK.

                 (a)      Administration.  Shares of Restricted Stock may be
         issued either alone, in addition to, or in tandem with other awards
         granted under the Plan and/or cash awards made outside the Plan.  The
         Committee shall determine the eligible persons to whom, and the time
         or times at which, grants of Restricted Stock will be made, the number
         of shares of Restricted Stock to be awarded to any person, the price
         (if any) to be paid by the recipient of Restricted Stock (subject to
         Section 7(b)), the time or times within which such awards may be
         subject to forfeiture, and the other terms, restrictions and
         conditions of the awards in addition to those set forth in Section
         7(c).  The Committee may condition the grant of Restricted Stock upon
         the attainment of specified performance goals or such other factors as
         the Committee may determine, in its sole discretion.  The provisions
         of Restricted Stock awards need not be the same with respect to each
         recipient.

                 (b)      Awards and Certificates.  The prospective recipient
         of a Restricted Stock award shall not have any rights with respect to
         such award, unless and until such recipient has executed an agreement
         evidencing the award and has delivered a fully executed copy thereof
         to the Corporation, and has otherwise complied with the applicable
         terms and conditions of such award.

                          (i)     The purchase price for shares of Restricted
                 Stock shall be established by the Committee and may be zero.





                                       12

<PAGE>   13

                          (ii)    Awards of Restricted Stock must be accepted
                 within a period of 60 days (or such shorter period as the
                 Committee may specify at grant) after the award date, by
                 executing a Restricted Stock Award Agreement and paying
                 whatever price (if any) is required under Section 7(b)(i).

                          (iii)   Each participant receiving a Restricted Stock
                 award shall be issued a stock certificate in respect of such
                 shares of Restricted Stock.  Such certificate shall be
                 registered in the name of such participant, and shall bear an
                 appropriate legend referring to the terms, conditions, and
                 restrictions applicable to such award.

                          (iv)    The Committee shall require that the stock
                 certificates evidencing such shares be held in custody by the
                 Corporation until the restrictions thereon shall have lapsed,
                 and that, as a condition of any Restricted Stock award, the
                 participant shall have delivered a stock power, endorsed in
                 blank, relating to the shares of Common Stock covered by such
                 award.

                 (c)      Restrictions and Conditions.  The shares of
         Restricted Stock awarded pursuant to this Section 7 shall be subject
         to the following restrictions and conditions:

                          (i)     In accordance with the provisions of this
                 Plan and the award agreement, during a period set by the
                 Committee commencing with the date of such award (the
                 "Restriction Period"), the participant shall not be permitted
                 to sell, transfer, pledge, assign, or otherwise encumber
                 shares of Restricted Stock awarded under the Plan, except to
                 the extent permitted under Section 13(h) below.  Within these
                 limits, the Committee, in its sole discretion, may provide for
                 the lapse of such restrictions in installments and may
                 accelerate or waive such restrictions, in whole or in part,
                 based on service, performance, such other factors or criteria
                 as the Committee may determine in its sole discretion.

                          (ii)    Except as provided in this paragraph (ii) and
                 Section 7(c)(i), the participant shall have, with respect to
                 the shares of Restricted Stock, all of the rights of a
                 shareholder of the Corporation, including the right to vote
                 the shares, and the right to receive any cash dividends.  The
                 Committee, in its sole discretion, as determined at the time
                 of award, may permit or require the payment of cash dividends
                 to be deferred and, if the Committee so determines,
                 reinvested, subject to Section 14(e), in additional Restricted
                 Stock to the extent shares are available under Section 3, or
                 otherwise reinvested.  Pursuant to Section 3 above, stock
                 dividends issued with respect to Restricted Stock shall be
                 treated as additional shares of Restricted Stock that are
                 subject to the same restrictions and other terms and
                 conditions that apply to the shares with respect to which such
                 dividends are issued. If the Committee so determines, the
                 award agreement may also impose restrictions on the right to
                 vote and the right to receive dividends.





                                       13

<PAGE>   14

                          (iii)   Subject to the applicable provisions of the
                 award agreement and this Section 7, upon termination of a
                 participant's employment with the Corporation and any
                 Subsidiary or Affiliate for any reason during the Restriction
                 Period, all shares still subject to restriction will vest, or
                 be forfeited, in accordance with the terms and conditions
                 established by the Committee at or after grant.

                          (iv)    If and when the Restriction Period expires
                 without a prior forfeiture of the Restricted Stock subject to
                 such Restriction Period, certificates for an appropriate
                 number of unrestricted shares shall be delivered to the
                 participant promptly.

                 (d)      Minimum Value Provisions.  In order to better ensure
         that award payments actually reflect the performance of the
         Corporation and service of the participant, the Committee may provide,
         in its sole discretion, for a tandem performance-based or other award
         designed to guarantee a minimum value, payable in cash or Common Stock
         to the recipient of a restricted stock award, subject to such
         performance, future service, deferral, and other terms and conditions
         as may be specified by the Committee.


SECTION 8.  OTHER STOCK-BASED AWARDS.

                 (a)      Administration.  Other Stock-Based Awards, including,
         without limitation, performance shares, convertible preferred stock,
         convertible debentures, exchangeable securities and Common Stock
         awards or options valued by reference to earnings per share or
         Subsidiary performance, may be granted either alone, in addition to,
         or in tandem with Stock Options, Stock Appreciation Rights, or
         Restricted Stock granted under the Plan and cash awards made outside
         of the Plan; provided that no such Other Stock-Based Awards may be
         granted in tandem with Incentive Stock Options if that would cause
         such Stock Options not to qualify as Incentive Stock Options pursuant
         to Section 422 of the Code.  Subject to the provisions of the Plan,
         the Committee shall have authority to determine the persons to whom
         and the time or times at which such awards shall be made, the number
         of shares of Common Stock to be awarded pursuant to such awards, and
         all other conditions of the awards.  The Committee may also provide
         for the grant of Common Stock upon the completion of a specified
         performance period.  The provisions of Other Stock-Based Awards need
         not be the same with respect to each recipient.

                 (b)      Terms and Conditions.  Other Stock-Based Awards made
         pursuant to this Section 8 shall be subject to the following terms and
         conditions:

                          (i)     Shares subject to awards under this Section 8
                 and the award agreement referred to in Section 8(b)(v) below,
                 may not be sold, assigned, transferred, pledged, or otherwise
                 encumbered prior to the date on which the shares are issued,
                 or, if later, the date on which any applicable restriction,
                 performance, or deferral period lapses.





                                       14

<PAGE>   15


                          (ii)    Subject to the provisions of this Plan and
                 the award agreement and unless otherwise determined by the
                 Committee at grant, the recipient of an award under this
                 Section 8 shall be entitled to receive, currently or on a
                 deferred basis, interest or dividends or interest or dividend
                 equivalents with respect to the number of shares covered by
                 the award, as determined at the time of the award by the
                 Committee, in its sole discretion, and the Committee may
                 provide that such amounts (if any) shall be deemed to have
                 been reinvested in additional shares of Common Stock or
                 otherwise reinvested.

                          (iii)   Any award under Section 8 and any shares of
                 Common Stock covered by any such award shall vest or be
                 forfeited to the extent so provided in the award agreement, as
                 determined by the Committee in its sole discretion.

                          (iv)    In the event of the participant's Retirement,
                 Disability, or death, or in cases of special circumstances,
                 the Committee may, in its sole discretion, waive in whole or
                 in part any or all of the remaining limitations imposed
                 hereunder (if any) with respect to any or all of an award
                 under this Section 8.

                          (v)     Each award under this Section 8 shall be
                 confirmed by, and subject to the terms of, an agreement or
                 other instrument by the Corporation and the participant.

                          (vi)    Common Stock (including securities
                 convertible into Common Stock) issued on a bonus basis under
                 this Section 8 may be issued for no cash consideration.
                 Common Stock (including securities convertible into Common
                 Stock) purchased pursuant to a purchase right awarded under
                 this Section 8 shall be priced at least 85% of the Fair Market
                 Value of the Common Stock on the date of grant.


SECTION 9.  AWARDS TO OUTSIDE DIRECTORS.

                 (a)      The provisions of this Section 9 shall apply only to
         awards to Outside Directors in accordance with this Section 9.  The
         Committee shall have no authority to determine the timing of or the
         terms or conditions of any award under this Section 9.

                 (b)      Effective as of the Distribution, each person serving
         as an Outside Director on such date will receive a grant of a number
         of shares of Common Stock (rounded up to the next whole share) having
         an aggregate Fair Market Value on such date equal to $10,000, which
         shares shall be restricted as provided in this Section 9.

                 (c)      On the date of the Annual Meeting of Shareholders of
         the Corporation occurring after the Distribution, unless this Plan has
         been previously terminated, each Outside Director will receive an
         automatic grant of a number of shares of Common Stock (rounded up to
         the next whole share) having an aggregate Fair Market Value on such
         date equal to





                                       15

<PAGE>   16

         $10,000 (subject to increase based upon any increase in the Consumer
         Price Index for Urban Wage Earning and Clerical Workers, U.S. All City
         Average Report, of the U.S. Bureau of Labor Statistics or, if such
         index is no longer available, a similar index), which shares shall be
         restricted as provided in this Section 9.

                 (d)      Each grant of Outside Director Restricted Stock shall
         vest in increments of one-third of the shares of Common Stock subject
         to such grant with the first one-third increment vesting on the date
         of grant, the second one-third increment on the first anniversary of
         the date of grant and the final one-third increment on the second
         anniversary of the date of grant, if the grantee is still a member of
         the Board on such dates.  Upon the vesting of the shares, the
         Corporation will deliver the stock certificate(s) evidencing the
         vested shares to the Outside Director, all restrictions on the shares
         imposed by this Plan (other than pursuant to Section 13(a) below) will
         be lifted and such shares will no longer be deemed to be "Outside
         Directors Restricted Stock" hereunder.

                 (e)      Until the earlier of (i) five years from the date of
         grant and (ii) the date on which the Outside Director ceases to serve
         as a director of the Corporation (the "Outside Director Period of
         Restriction"), no Outside Director Restricted Stock may be sold,
         transferred, pledged, assigned, or otherwise alienated or
         hypothecated, otherwise than by will or by the laws of descent and
         distribution.

         Each certificate representing Outside Director Restricted Stock
         granted pursuant to this Section 9 shall bear the following legend:

                 "The sale or other transfer of the shares represented by this
                 certificate, whether voluntary, involuntary, or by operation
                 of law, is subject to certain restrictions on transfer set
                 forth in the AmSurg Corp. 1997 Stock Incentive Plan (the
                 "Plan").  A copy of the Plan and the rules of such Plan may be
                 obtained from the Secretary of AmSurg Corp."

         Once the Outside Director Period of Restriction has lapsed, the
         grantee shall be entitled to have the legend required by this Section
         9 removed from such stock certificate(s); provided however, that such
         certificate shall be subject to any legend required by applicable
         state or federal law.

                 (f)      Upon termination of an Outside Director's service as
         a member of the Board for any reason other than death, disability or
         retirement, all shares of Outside Restricted Stock not theretofore
         vested will be forfeited.  Upon termination of an Outside Director's
         service as a member of the Board due to death, disability or
         retirement, all shares of Outside Director Restricted Stock will
         immediately vest.

                 (g)      Grantees of Outside Director Restricted Stock shall
         enter into a restricted stock agreement with the Corporation setting
         forth the terms provided herein.  Each





                                       16

<PAGE>   17

         participant receiving an award of Outside Director Restricted Stock
         shall be issued one or more stock certificates evidencing the shares
         of Outside Director Restricted Stock.  Such certificates shall be
         registered in the name of the Outside Director, and shall bear an
         appropriate legend referring to the terms, conditions and restrictions
         applicable to the award.  The stock certificates shall be held in the
         custody of the Corporation until the award or portion thereof
         represented by such certificate is vested.  The Corporation may
         require the Outside Director to deliver a stock power, endorsed in
         blank, relating to the shares of Common Stock covered by the award.

                 (h)      Outside Directors will have the right to vote the
         shares and to receive cash dividends with respect to the shares of
         Outside Director Restricted Stock.  Stock dividends issued with
         respect to Outside Director Restricted Stock will be treated as
         additional shares of Outside Director Restricted Stock subject to the
         same restrictions and vesting schedule as the shares of Outside
         Director Restricted Stock with respect to which they were received.

                 (i)      Shares of Outside Director Restricted Stock shall be
         subject to Section 10.  The number of shares underlying each grant of
         Outside Director Restricted Stock shall be adjusted automatically in
         the same manner as the number of shares under Section 3 hereof at any
         time that awards of Restricted Stock are adjusted as provided in
         Section 3.


SECTION 10.  CHANGE IN CONTROL PROVISIONS.

                 (a)      Impact of Event.  In the event of:

                          (1) a "Change in Control" as defined in Section
                              10(b); or

                          (2) a "Potential Change in Control" as defined in
                 Section 10(c), but only if and to the extent so determined by
                 the Committee or the Board at or after grant (subject to any
                 right of approval expressly reserved by the Committee or the
                 Board at the time of such determination),

                          (i)      Subject to the limitations set forth below in
                 this Section 10(a), the following acceleration provisions
                 shall apply:

                              (a)  Any Stock Appreciation Rights or any Stock
                          Option awarded under the Plan not previously
                          exercisable and vested shall become fully exercisable
                          and vested.

                              (b)  The restrictions applicable to any
                          Restricted Stock, Outside Director Restricted Stock
                          and Other Stock-Based Awards, in each case to the
                          extent not already vested under the Plan, shall lapse
                          and such shares and awards shall be deemed fully
                          vested.





                                       17

<PAGE>   18


                          (ii)    Subject to the limitations set forth below in
                 this Section 10(a), the value of all outstanding Stock
                 Options, Stock Appreciation Rights, Restricted Stock, Outside
                 Director Restricted Stock and Other Stock-Based Awards, in
                 each case to the extent vested, shall, unless otherwise
                 determined Board or by the Committee in its sole discretion
                 prior to any Change in Control, be cashed out on the basis of
                 the "Change in Control Price" as defined in Section 10(d) as
                 of the date such Change in Control or such Potential Change in
                 Control is determined to have occurred or such other date as
                 the Board or Committee may determine prior to the Change in
                 Control.

                          (iii)   The Board or the Committee may  impose
                 additional conditions on the acceleration or valuation of any
                 award in the award agreement.

                 (b)      Definition of Change in Control.  For purposes of
         Section 10(a), a "Change in Control" means the happening of any of the
         following:

                          (i)     any person or entity, including a "group" as
                 defined in Section 13(d)(3) of the Exchange Act, other than
                 the Corporation or a wholly-owned subsidiary thereof or any
                 employee benefit plan of the Corporation or any of its
                 Subsidiaries, becomes the beneficial owner of the
                 Corporation's securities having 35% or more of the combined
                 voting power of the then outstanding securities of the
                 Corporation that may be cast for the election of directors of
                 the Corporation (other than as a result of an issuance of
                 securities initiated by the Corporation in the ordinary course
                 of business); or

                          (ii)    as the result of, or in connection with, any
                 cash tender or exchange offer, merger or other business
                 combination, sales of assets or contested election, or any
                 combination of the foregoing transactions, less than a
                 majority of the combined voting power of the then outstanding
                 securities of the Corporation or any successor corporation or
                 entity entitled to vote generally in the election of the
                 directors of the Corporation or such other corporation or
                 entity after such transaction are held in the aggregate by the
                 holders of the Corporation's securities entitled to vote
                 generally in the election of directors of the Corporation
                 immediately prior to such transaction; or

                          (iii)   during any period of two consecutive years,
                 individuals who at the beginning of any 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 Corporation's shareholders, of each director
                 of the Corporation first elected during such period was
                 approved by a vote of at least two-thirds of the directors of
                 the Corporation then still in office who were directors of the
                 Corporation at the beginning of any such period.

                 (c)      Definition of Potential Change in Control.  For
         purposes of Section 10(a), a "Potential Change in Control" means the
         happening of any one of the following:





                                       18

<PAGE>   19


                          (i)     The approval by shareholders of an agreement
                 by the Corporation, the consummation of which would result in
                 a Change in Control of the Corporation as defined in Section
                 10(b); or

                          (ii)    The acquisition of beneficial ownership,
                 directly or indirectly, by any entity, person or group (other
                 than the Corporation or a Subsidiary or any Corporation
                 employee benefit plan (including any trustee of such plan
                 acting as such trustee)) of securities of the Corporation
                 representing 5% or more of the combined voting power of the
                 Corporation's outstanding securities and the adoption by the
                 Committee of a resolution to the effect that a Potential
                 Change in Control of the Corporation has occurred for purposes
                 of this Plan.

                 (d)      Change in Control Price.  For purposes of this
         Section 10, "Change in Control Price" means the highest price per
         share paid in any transaction reported on The Nasdaq Stock Market
         National Market or such other exchange or market as is the principal
         trading market for the Common Stock, or paid or offered in any bona
         fide transaction related to a Potential or actual Change in Control of
         the Corporation at any time during the 60 day period immediately
         preceding the occurrence of the Change in Control (or, where
         applicable, the occurrence of the Potential Change in Control event),
         in each case as determined by the Committee except that, in the case
         of Incentive Stock Options and Stock Appreciation Rights relating to
         Incentive Stock Options, such price shall be based only on
         transactions reported for the date on which the optionee exercises
         such Stock Appreciation Rights or, where applicable, the date on which
         a cash out occurs under Section 10(a)(ii).


SECTION 11.  AMENDMENTS AND TERMINATION.

         The Board may at any time amend, alter or discontinue the Plan;
provided, however, that, without the approval of the Corporation's
shareholders, no amendment or alteration may be made which would (a) except as
a result of the provisions of Section 3(c) of the Plan, increase the maximum
number of shares that may be issued under the Plan or increase the Section
162(m) Maximum, (b) change the provisions governing Incentive Stock Options
except as required or permitted under the provisions governing incentive stock
options under the Code, or (c) make any change for which applicable law or
regulatory authority (including the regulatory authority of The Nasdaq Stock
Market National Market or any other market or exchange on which the Common
Stock is traded) would require shareholder approval or for which shareholder
approval would be required to secure full deductibility of compensation
received under the Plan under Section 162(m) of the Code.  No amendment,
alteration, or discontinuation shall be made which would impair the rights of
an optionee or participant under a Stock Option, Stock Appreciation Right,
Restricted Stock, Other Stock-Based Award or Outside Director Restricted Stock
theretofore granted, without the participant's consent.





                                       19

<PAGE>   20

         The Committee may amend the terms of any Stock Option or other award
theretofore granted, prospectively or retroactively, but, subject to Section 3
above, no such amendment shall impair the rights of any holder without the
holder's consent.  The Committee may also substitute new Stock Options for
previously granted Stock Options (on a one for one or other basis), including
previously granted Stock Options having higher option exercise prices.  Solely
for purposes of computing the Section 162(m) Maximum, if any Stock Options or
other awards previously granted to a participant are canceled and new Stock
Options or other awards having a lower exercise price or other more favorable
terms for the participant are substituted in their place, both the initial
Stock Options or other awards and the replacement Stock Options or other awards
will be deemed to be outstanding (although the canceled Stock Options or other
awards will not be exercisable or deemed outstanding for any other purposes).

SECTION 12. UNFUNDED STATUS OF PLAN.

         The Plan is intended to constitute an "unfunded" plan for incentive
and deferred compensation.  With respect to any payments not yet made to a
participant or optionee by the Corporation, nothing contained herein shall give
any such participant or optionee any rights that are greater than those of a
general creditor of the Corporation.  In its sole discretion, the Committee may
authorize the creation of trusts or other arrangements to meet the obligations
created under the Plan to deliver Common Stock or payments in lieu of or with
respect to awards hereunder; provided, however, that, unless the Committee
otherwise determines with the consent of the affected participant, the
existence of such trusts or other arrangements is consistent with the
"unfunded" status of the Plan.


SECTION 13. GENERAL PROVISIONS.

                 (a)      The Committee may require each person purchasing
         shares pursuant to a Stock Option or other award under the Plan to
         represent to and agree with the Corporation in writing that the
         optionee or participant is acquiring the shares without a view to
         distribution thereof.  The certificates for such shares may include
         any legend which the Committee deems appropriate to reflect any
         restrictions on transfer.  All certificates for shares of Common Stock
         or other securities delivered under the Plan shall be subject to such
         stock-transfer orders and other restrictions as the Committee may deem
         advisable under the rules, regulations, and other requirements of the
         Securities and Exchange Commission, any stock exchange upon which the
         Common Stock is then listed, and any applicable Federal or state
         securities law, and the Committee may cause a legend or legends to be
         put on any such certificates to make appropriate reference to such
         restrictions.

                 (b)      Nothing contained in this Plan shall prevent the
         Board from adopting other or additional compensation arrangements,
         subject to shareholder approval if such approval is required; and such
         arrangements may be either generally applicable or applicable only in
         specific cases.





                                       20

<PAGE>   21


                 (c)      The adoption of the Plan shall not confer upon any
         employee of the Corporation or any Subsidiary or Affiliate any right
         to continued employment with the Corporation or a Subsidiary or
         Affiliate, as the case may be, nor shall it interfere in any way with
         the right of the Corporation or a Subsidiary or Affiliate to terminate
         the employment of any of its employees at any time.

                 (d)      No later than the date as of which an amount first
         becomes includible in the gross income of the participant for Federal
         income tax purposes with respect to any award under the Plan, the
         participant shall pay to the Corporation, or make arrangements
         satisfactory to the Committee regarding the payment of, any Federal,
         state, or local taxes of any kind required by law to be withheld with
         respect to such amount.  The Committee may require withholding
         obligations to be settled with Common Stock, including Common Stock
         that is part of the award that gives rise to the withholding
         requirement.  The obligations of the Corporation under the Plan shall
         be conditional on such payment or arrangements and the Corporation and
         its Subsidiaries or Affiliates shall, to the extent permitted by law,
         have the right to deduct any such taxes from any payment of any kind
         otherwise due to the participant.

                 (e)      The actual or deemed reinvestment of dividends or
         dividend equivalents in additional Restricted Stock (or other types of
         Plan awards) at the time of any dividend payment shall only be
         permissible if sufficient shares of Common Stock are available under
         Section 3 for such reinvestment (taking into account then outstanding
         Stock Options and other Plan awards).

                 (f)      The Plan and all awards made and actions taken
         thereunder shall be governed by and construed in accordance with the
         laws of the State of Tennessee.

                 (g)      The members of the Committee and the Board shall not
         be liable to any employee or other person with respect to any
         determination made hereunder in a manner that is not inconsistent with
         their legal obligations as members of the Board.  In addition to such
         other rights of indemnification as they may have as directors or as
         members of the Committee, the members of the Committee shall be
         indemnified by the Corporation against the reasonable expenses,
         including attorneys' fees actually and necessarily incurred in
         connection with the defense of any action, suit or proceeding, or in
         connection with any appeal therein, to which they or any of them may
         be a party by reason of any action taken or failure to act under or in
         connection with the Plan or any option granted thereunder, and against
         all amounts paid by them in settlement thereof (provided such
         settlement is approved by independent legal counsel selected by the
         Corporation) or paid by them in satisfaction of a judgment in any such
         action, suit or proceeding, except in relation to matters as to which
         it shall be adjudged in such action, suit or proceeding that such
         Committee member is liable for negligence or misconduct in the
         performance of his duties; provided that within 60 days after
         institution of any such action, suit or proceeding, the Committee
         member shall in writing offer the Corporation the opportunity, at its
         own expense, to handle and defend the same.





                                       21

<PAGE>   22

                 (h)      In addition to any other restrictions on transfer
         that may be applicable under the terms of this Plan or the applicable
         award agreement, no Stock Option, Stock Appreciation Right, Restricted
         Stock award, Other Stock-Based Award or Outside Director Restricted
         Stock award or other right issued under this Plan is transferable by
         the participant without the prior written consent of the Committee,
         or, in the case of an Outside Director, the Board, other than (i)
         transfers by a participant to a member of his or her Immediate Family
         or a trust for the benefit of the participant or a member of his or
         her Immediate Family or (ii) transfers by will or by the laws of
         descent and distribution.  The designation of a beneficiary will not
         constitute a transfer.

                 (i)      The Committee may, at or after grant, condition the
         receipt of any payment in respect of any award or the transfer of any
         shares subject to an award on the satisfaction of a six-month holding
         period, if such holding period is required for compliance with Section
         16 under the Exchange Act.

SECTION 14. EFFECTIVE DATE OF PLAN.

         The Plan shall be effective upon adoption by the Board (the "Effective
Date"), subject to approval by the holders of a majority of the votes of the
Corporation's capital stock.


SECTION 15. TERM OF PLAN.

         No Stock Option, Stock Appreciation Right, Restricted Stock award,
Other Stock-Based Award or award of Outside Director Restricted Stock award
shall be granted pursuant to the Plan on or after the tenth anniversary of the
Effective Date of the Plan, but awards granted prior to such tenth anniversary
may be extended beyond that date.








                                       22