Current Report

Exhibit 10.1

THIRD AMENDED EMPLOYMENT AGREEMENT

THIRD AMENDED EMPLOYMENT AGREEMENT dated as of October 1, 2009, by and between LINCARE HOLDINGS INC. , a Delaware corporation (“Lincare” or “Company”), and JOHN P. BYRNES (“Executive”).

W I T N E S S E T H:

WHEREAS, Executive is employed by Company and is subject to the terms of that certain Employment Agreement by and between Executive and Company dated November 15, 2004, as amended January 23, 2007 and December 28, 2007 (the “2004 Agreement (as amended)”);

WHEREAS, Executive’s Initial Employment Term (as defined in the 2004 Agreement (as amended)) will expire on December 31, 2009;

WHEREAS, Company and Executive desire to amend the 2004 Agreement (as amended) to provide for the Initial Employment Term to be extended through December 31, 2012 (unless earlier terminated pursuant to the terms of this Agreement) and Company desires to induce Executive to continue in the employ of Company under the terms of this Third Amended Employment Agreement; and

WHEREAS, Executive is willing to accept such continued employment with Company on a full-time basis, all in accordance with the terms and conditions set forth below.

NOW, THEREFORE, for and in consideration of the premises hereof and the mutual covenants contained herein, the parties hereto do hereby covenant and agree as follows:

1. Employment .

(a) Company hereby agrees to continue employing Executive, and Executive hereby agrees to continue his employment with Company, for the period set forth in Section 2 hereof, all upon the terms and conditions hereinafter set forth.

(b) Executive affirms and represents that he is under no obligation to any former employer or other party which is in any way inconsistent with, or which imposes any restriction upon, Executive’s acceptance of employment hereunder with Company, the employment of Executive by Company, or Executive’s undertakings under this Agreement.

2. Term of Employment . Unless earlier terminated as hereinafter provided, the initial term of Executive’s employment under this Agreement shall be for a period beginning on January 1, 2005 and ending on December 31, 2012 (such period from January 1, 2005 until December 31, 2012 or, if Executive’s employment hereunder is earlier terminated, such shorter period, being hereinafter called the “Initial Employment Term”). In the event that Executive continues in the full-time employ of Company after the end of the Initial Employment Term (it

being expressly understood and agreed that Company has no obligation to continue employing Executive, and Executive has no obligation to continue being employed by Company, whether or not on a full-time basis, after expiration of the Initial Employment Term), then, unless otherwise expressly agreed to by Executive and Company in writing, Executive’s continued employment with Company shall, notwithstanding anything to the contrary expressed or implied herein, continue to be subject to the terms and conditions of this Agreement. As used in this Agreement, the term “Employment Term” shall mean the period beginning on January 1, 2005 and ending on the date of Executive’s cessation of employment with Company, whether such date is before, on or after the expiration of the Initial Employment Term.

3. Duties . Executive shall be employed as the Chief Executive Officer of Company, shall faithfully and competently perform such duties as are specified by the By-laws of Company and shall also perform and discharge such other reasonable employment duties and responsibilities as the Board of Directors of Company (the “Board”) may from time to time prescribe. Executive shall perform his duties at such places and times as the Board may reasonably prescribe. Except as may be approved herein or otherwise approved in advance by Company, and except during vacation periods and reasonable periods of absence due to sickness, personal injury or other disability, Executive shall devote his full time throughout the Employment Term to the services required of him hereunder and shall render his services exclusively to Company during the Employment Term. During the Employment Term, Executive shall use his best efforts, judgment and energy to improve and advance the business and interests of Company in a manner consistent with the duties of his position. Notwithstanding anything herein to the contrary, the provisions of this Section 3 shall not limit or restrict Executive from (i) serving as an outside director for one (1) or more corporate entities not affiliated with Company; (ii) serving as an officer or director of or otherwise participating in educational, welfare, social, religious and civic organizations; (iii) delivering lectures or fulfilling speaking engagements; or (iv) managing personal investments, in each case so long as such activities do not interfere with Executive’s ability to perform his obligations hereunder.

4. Compensation .

(a) As compensation for the complete and satisfactory performance by Executive of the services to be performed by Executive hereunder during the Employment Term commencing as of January 1, 2009, Company shall pay Executive a base salary at the annual rate equal to $896,816.00, Executive’s 2009 Salary (as computed in accordance with the 2004 Agreement (as amended)) (said amount, together with any increases thereto during the Employment Term, being hereinafter referred to as the “Salary”). Any Salary payable hereunder shall be paid in regular intervals in accordance with Company’s payroll practices. The Salary payable to Executive pursuant to this Section 4(a) shall be increased annually as of January 1, 2010, and each January 1 thereafter during the Employment Term, for the twelve (12) month period then commencing, by an amount equal to: (1) the annual percentage increase in the Consumer Price Index for All Urban Consumers, All Items, for the most recent twelve (12) month period for which such figures are then available as reported in the Monthly Labor Review published by the Bureau of Labor Statistics of the U.S. Department of Labor or (ii) such higher amount as may be determined from time to time by the Board (or an authorized committee thereof) in its sole discretion.

(b) In addition to Salary, Company shall also pay bonus compensation (“Bonus”) to Executive in respect of each calendar year (or applicable portion thereof) during the Employment Term. Such Bonus for any full calendar year will be an amount equal to the lesser of 200% of Salary or: (i) the percentage of Salary set forth in the Table below which corresponds to the percentage by which Company’s fully diluted earnings per share (“EPS”) in respect of such calendar year compares with the projected EPS of Company as set forth in the annual business plan (the “Business Plan EPS”) prepared in advance by Company and approved by the Board; multiplied by (ii) Executive’s Salary for such calendar year.

In the event that the Employment Term ends at any time other than on December 31 of any year, Executive’s Bonus in respect of such calendar year shall be prorated, and shall be an amount equal to: (i) the percentage set forth on the Table above which corresponds to the percentage by which Company’s year-to-date fully diluted EPS (as determined by the then-most recently announced fully diluted EPS of Company) compares with the figure obtained by multiplying the Business Plan EPS by a fraction, the numerator of which shall be the number of completed fiscal quarters in such calendar year for which fully diluted EPS of Company have been announced and the denominator of which shall be four (4); multiplied by (ii) Executive’s Salary for such calendar year; multiplied by (iii) a fraction, the numerator of which shall be the number of full calendar months included in the Employment Term for the then current calendar year and the denominator of which shall be twelve (12).

Notwithstanding the foregoing provisions of this Section 4(b), the Board (or an authorized committee thereof) shall have the discretion to adjust upward or downward the Business Plan EPS to account equitably for: (i) any extraordinary charges; (ii) any unusual non-recurring items; (iii) changes after the date hereof in accounting principles required under generally accepted accounting principles; or (iv) any unanticipated events or occurrences; which events impacted Company’s fully diluted EPS in respect of any such applicable period or comparable prior year period.

Nothing contained herein and no action taken in respect of any Bonus (or otherwise in respect of this Section 4(b)) shall create or be construed to create a trust of any kind. Executive’s right to receive any Bonus pursuant to this Section 4(b) shall be no greater than the right of an unsecured general creditor of Company to receive payment from Company. All Bonuses under this Section 4(b) shall be paid from the general funds of Company, and no special or separate fund shall be established, and no segregation of assets shall be made, to assure payment of any Bonuses hereunder.

(c) The payment of any Salary, Bonus or other amounts hereunder shall be subject to applicable withholding and payroll taxes, and such other deductions as may be required under Company’s employee benefit plans. Payment of Executive’s Bonus shall be made by March 15 of the year following the year to which the Bonus relates.

5. Benefits . During the Employment Term, Executive shall:

(a) be eligible to participate in all employee fringe benefits and any pension and/or profit sharing plans that may be provided by Company for its key executive employees in accordance with the provisions of any such plans, as same may be in effect on and after the date hereof;

(b) be eligible to participate in such additional perquisites and fringe benefits as may be approved from time to time by the Board (or any committee thereof) for Company’s key executives;

(c) be eligible to participate in any medical and health plans or other employee welfare benefit plans that may be provided by Company for its key executive employees in accordance with the provisions of any such plans, as same may be in effect on and after the date hereof;

(d) be entitled to annual paid vacation in accordance with Company policy that may be applicable on and after the date hereof to key executive employees;

(e) be entitled to sick leave, sick pay and disability benefits in accordance with any Company policy that may be applicable on and after the date hereof to key executive employees;

(f) be entitled to reimbursement for all reasonable and necessary out-of-pocket living and travel expenses incurred by Executive while away from his usual place of business in the performance of his duties hereunder in accordance with Company’s policies applicable on and after the date hereof in respect thereto. Notwithstanding the foregoing, (i) the expenses eligible for reimbursement may not affect the expenses eligible for reimbursement in any other taxable year, (ii) such reimbursement must be made on or before the last day of the year following the year in which the expenses was incurred, and (iii) the right to reimbursement is not subject to liquidation or exchange for another benefit; and

(g) with respect to each year in the Term beginning on or after January 1, 2010, be entitled to a cash allowance of $7,000 for financial planning services (to the extent such allowance is not used during such year, such allowance amount shall be forfeited).

6. Inventions and Confidential Information . Executive hereby covenants, agrees and acknowledges as follows:

(a) Company is engaged in a continuous program of research, design, development, production, marketing and servicing with respect to its business and that as part of Executive’s employment by Company, Executive is (or may be) expected to make new contributions and inventions of value to Company.

(b) Executive’s employment hereunder creates a relationship of confidence and trust between Executive and Company with respect to certain information pertaining to the business of Company and its Affiliates (as hereinafter defined) or pertaining to the business of any client or customer of Company or its Affiliates which may be made known to Executive by Company or any of its Affiliates or by any client or customer of Company or any of its Affiliates or learned by Executive during the course of his employment.

(c) Company possesses and will continue to possess information that has been created, discovered or developed by, or otherwise become known to it (including, without limitation, information created, discovered, developed or made known by Executive during the period of or arising out of his employment with Company) or in which property rights have been or may be assigned or otherwise conveyed to Company, which information has commercial value in the business in which Company is engaged and is treated by Company as confidential.

(d) Any and all inventions, products, discoveries, improvements, processes, manufacturing, marketing and service methods or techniques, formulae, designs, styles, specifications, data bases, computer programs (whether in source code or object code), know-how, strategies and data, whether or not patentable or registrable under copyright or similar statutes, made, developed or created by Executive (whether at the request or suggestion of Company, any of its Affiliates, or otherwise, whether alone or in conjunction with others, and whether during regular hours of work or otherwise) during the period of his employment by Company (collectively, hereinafter referred to as “Inventions”), which may pertain to the business, products, or processes of Company or any of its Affiliates, will be promptly and fully disclosed by Executive to an appropriate executive officer of Company (other than Executive) and shall be Company’s exclusive property, and Executive will promptly execute and/or deliver to an appropriate executive officer of Company (other than Executive) without any additional compensation therefor, all papers, drawings, models, data, documents and other material pertaining to or in any way relating to any Inventions made, developed or created by him as aforesaid. For the purposes of this Agreement, the term “Affiliate” or “Affiliates” of Company shall mean any corporation or other entity which is controlled, directly or indirectly, by Company. As used in the preceding sentence, the word “control” shall mean, with respect to any entity, the power to vote or direct the voting of at least 50% of the voting equity interests in such entity.

(e) Executive will keep confidential and will hold for Company’s sole benefit any Invention which is to be the exclusive property of Company under this Section 6 for which no patent, copyright, trademark or other right or protection is issued.

(f) Executive also agrees that he will not without the prior written consent of an appropriate executive officer of Company (other than Executive) use for his benefit or disclose at any time during his employment by Company, or thereafter, except to the extent

required by the performance by him of his duties as an executive of Company, any information obtained or developed by him while in the employ of Company with respect to any Inventions or with respect to any customers, clients, suppliers, products, employees, financial affairs, or methods of design, distribution, marketing, service, procurement or manufacture of Company or any of its Affiliates, or any confidential matter, except information which at the time is generally known to the public other than as a result of disclosure by him not permitted hereunder, or if such information is required to be disclosed under court order or other applicable law.

(g) Executive acknowledges and agrees that a remedy at law for any breach or threatened breach of the provisions of this Section 6 would be inadequate and, therefore, agrees that Company and its Affiliates shall be entitled to injunctive relief in addition to any other available rights and remedies in case of any such breach or threatened breach; provided, however, that nothing contained herein shall be construed as prohibiting Company or any of its Affiliates from pursuing any other rights and remedies available for any such breach or threatened breach.

(h) Executive agrees that upon termination of his employment hereunder for any reason, Executive shall forthwith return to Company all documents and other property in his possession belonging to Company or any of its Affiliates.

(i) Without limiting the generality of Section 10 hereof, Executive hereby expressly agrees that the foregoing provisions of this Section 6 shall be binding upon Executive’s heirs, successors and legal representatives.

7. Termination .

(a) The Employment Term shall end and Executive’s employment hereunder shall be terminated upon the occurrence of any of the following:

(i) the death of Executive;

(ii) termination of Executive’s employment hereunder by Company based upon the inability of Executive to perform his duties on account of disability or incapacity for a period of one hundred eighty (180) or more days, whether or not consecutive, occurring within any period of twelve (12) consecutive months; provided, however, that such employment shall not be terminated by Company if it can reasonably accommodate Executive’s disability or incapacity;

(iii) the termination of Executive’s employment hereunder by Executive at any time without “Good Reason” (including, without limitation, resignation or retirement);

(iv) the termination of Executive’s employment hereunder by Executive at any time for “Good Reason”;

(v) termination of Executive’s employment hereunder by Company at any time for “cause”, such termination to take effect immediately upon written notice from Company to Executive;

(vi) termination of Executive’s employment hereunder by Company at any time other than for “cause”, such termination to take effect immediately upon written notice from Company to Executive; or

(vii) upon a Change of Control of Company.

The following actions, failures or events by or affecting Executive shall constitute “cause” for termination within the meaning of clause (v) above: (A) conviction for having committed a felony; (B) determination by at least two-thirds of the members of the Board that Executive has committed acts of dishonesty or moral turpitude; (C) failure to follow reasonable and lawful directives of the Board; or (D) gross negligence or willful misconduct by Executive in the performance of his obligations hereunder. The term “willful” shall mean any act or failure to act taken or omitted to be taken by Executive not in good faith and without reasonable belief that the act or omission was in the best interest of Company.

As used herein, “Good Reason” shall mean the occurrence of any of the following events without Executive’s written consent: (A) a material diminution in or adverse alteration to Executive’s duties or responsibilities as set forth in Section 3 herein, (B) the relocation of Executive’s principal office outside of the area that comprises a fifty (50) mile radius from Clearwater, Florida, (C) Company requires Executive to relocate his personal place of residence or (D) a failure of Company to comply with any material provision of this Agreement (other than any such failure caused by a change in applicable law or regulation), including, without limitation, Section 4 of this Agreement; provided that the events described in clauses (A), (B), (C) and (D) above shall not constitute Good Reason (1) until Executive provides written notice to Company within ninety (90) days of his becoming aware of the occurrence of the event or circumstance giving rise to Executive’s claim of “Good Reason” and (2) actually resigns within 30 days after the end of such 90 day period unless such event or circumstance has not been cured by Company within thirty (30) days after Company’s receipt of such written notice.

As used herein the term “Change of Control of Company” shall mean any of the following: (A) sale or other disposition (or the last such sale or other disposition) resulting in the transfer of more than 50% of the outstanding common stock of Company to an unrelated and unaffiliated third party purchaser; (B) the consolidation or merger of Company or a subsidiary thereof with or into any other entity (unless immediately following such consolidation or merger, the outstanding common stock of Company immediately prior to such consolidation or merger continues to represent (either by remaining outstanding or being converted into voting securities of the resulting or surviving entity or any parent thereof) more than fifty percent (50%) of the outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such consolidation or merger (including, without limitation, a corporation that owns Company or all or substantially all of Company’s assets either directly or through one or more subsidiaries); (C) a sale of substantially all of the properties and assets of Company as an entirety to an unrelated and unaffiliated third party purchaser; or (D) the time at which any person (including a person’s affiliates and associates) or group (as that term is understood under Section 13(d) of the Exchange Act and the rules and regulations thereunder), files a Schedule 13-D or 14D-1 (or any successor schedule, form or report under the Exchange Act) disclosing that such person or group has become the beneficial owner (as defined under

Rule 13d-3 or any successor rule or regulation promulgated under the Exchange Act) of shares of capital stock of Company giving such person or group a majority of the voting power of all outstanding capital stock of Company with the right to vote generally in an election for directors or other capital stock of Company into which the common stock or other voting stock is reclassified or changed.

(b)(i) If the Employment Term ends by reason of the occurrence of an event described in either Section 7(a)(iv) or (vi) and not in connection with a Change in Control of Company, then Company shall pay to Executive, as severance pay or liquidated damages or both, an amount equal to two (2) times the sum of (A) his then-current annual Salary in effect immediately prior to such termination; plus (B) the average of the Bonus paid to or earned by Executive with respect to the three calendar years immediately preceding such termination. All amounts payable under this clause (i) shall be paid in twenty-four (24) equal monthly installments commencing on the first day of the calendar month immediately following the end of the Employment Term or such later date as is required by Section 7(e).

(ii) If the Employment Term ends by reason of the occurrence of an event described in Section 7(a)(vii) (regardless of whether Executive experiences a termination of employment), then provided that such event constitutes (i) a change in the ownership of Company (as defined in Treasury Regulation Section 1.409A-3(i)(5)(v)), (ii) a change in effective control of Company (as defined in Treasury Regulation Section 1.409A-3(1)(5)(vi)), or a change in the ownership of a substantial portion of the assets of Company (as defined in Treasury Regulation Section 1.409A-3(i)(5)(vii)), Company shall pay to Executive, as severance pay or liquidated damages or both, an amount equal to two (2) times the sum of (A) his then-current annual Salary in effect immediately prior to the occurrence of such event; plus (B) the average of the Bonus paid to or earned by Executive with respect to the three calendar years immediately preceding such termination; plus (C) an amount determined by Company, in its sole discretion, to be equal to the average annual cost for Company employees of obtaining medical, dental and vision insurance under COBRA, which amount is hereby initially determined to be Ten Thousand and No/100 Dollars ($10,000.00). All amounts payable under this clause (ii) shall be paid no later than ten (10) business days after the end of the Employment Term.

It is understood and agreed that this Section 7(b) shall survive the expiration or termination of this Agreement and the provisions hereof shall be binding upon any successor in interest of Company.

(c) Notwithstanding anything to the contrary expressed or implied herein, and except as set forth in Section 7(b) hereof, Company (and its Affiliates) shall not be obligated to make any payments to Executive or on his behalf of whatever kind or nature by reason of Executive’s cessation of employment other than: (i) such amounts, if any, of his Salary and Bonus as shall have accrued and remain unpaid as of the date the Employment Term ends (including, but not limited to, the amount of any Bonus payable in respect of the then-current calendar year), which amounts shall be paid no later than ten (10) business days after the end of the Employment Term; (ii) such other amounts which may be otherwise payable to Executive from Company’s retirement plans or other benefit plans on account of such cessation of employment (including, but not limited to, payment for any vested but unused vacation and the treatment of outstanding awards of Stock Options and Restricted Stock in accordance with the

terms applicable to such awards); and (iii) Company shall cover Executive under its medical and dental plan, and life insurance through the end of the last calendar day of the month during which the Employment Term ends, and thereafter, Executive shall be given COBRA conversion rights for Company’s medical and dental plan. Nothing in this Section 7(c) shall limit Executive’s right to contest any termination of Executive’s employment hereunder by appropriate legal proceedings. It is understood and agreed that this Section 7(c) shall survive the expiration or termination of this Agreement and the provisions hereof shall be binding upon any successor in interest of Company.

(d) No interest shall accrue on or be paid with respect to any portion of any payments hereunder so long as same are paid in accordance with the terms of this Agreement.

(e) Distributions . The following rules shall apply with respect to distribution of the payments and benefits, if any, to be provided to Executive under Section 7:

(i) It is intended that each installment of the payments and benefits provided under Section 7 shall be treated as a separate “payment” for purposes of Section 409A of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), and the guidance issued thereunder (“Section 409A”). Neither Company nor Executive shall have the right to accelerate or defer the delivery of any such payments or benefits except to the extent specifically permitted or required by Section 409A;

(ii) If, as of the date of the “separation from service” of Executive from Company, Executive is not a “specified employee” (each within the meaning of Section 409A), then each installment of the payments and benefits shall be made on the dates and terms set forth in Section 7; and

(iii) If, as of the date of the “separation from service” of Executive from Company, Executive is a “specified employee” (each, for purposes of this Agreement, within the meaning of Section 409A), then:

(A) Each installment of the payments and benefits due under Section 7 that, in accordance with the dates and terms set forth herein, will in all circumstances, regardless of when the separation from service occurs, be paid within the Short-Term Deferral Period (as hereinafter defined) shall be treated as a short-term deferral within the meaning of Treasury Regulation Section 1.409A-1(b)(4) to the maximum extent permissible under Section 409A. For purposes of this Agreement, the “Short-Term Deferral Period” means the period ending on the later of the 15th day of the third month following the end of Executive’s tax year in which Executive’s separation from service occurs and the 15th day of the third month following the end of Company’s tax year in which Executive’s separation from service occurs; and

(B) Each installment of the payments and benefits due under Section 7 that is not paid within the Short-Term Deferral Period and that would, absent this subsection, be paid within the six-month period following the “separation from service” of Executive of Company shall not be paid until the date that is six months and one day after such separation from service (or, if earlier, the death of Executive), with any such installments that are

required to be delayed being accumulated during the six-month period and paid in a lump sum on the date that is six months and one day following Executive’s separation from service and any subsequent installments, if any, being paid in accordance with the dates and terms set forth herein; provided, however, that the preceding provisions of this sentence shall not apply to any installment of payments and benefits if and to the maximum extent that that such installment is deemed to be paid under a separation pay plan that does not provide for a deferral of compensation by reason of the application of Treasury Regulation 1.409A-1(b)(9)(iii) (relating to separation pay upon an involuntary separation from service). Any installments that qualify for the exception under Treasury Regulation Section 1.409A-1(b)(9)(iii) must be paid no later than the last day of the second taxable year of Executive following the taxable year of Executive in which the separation from service occurs.

8. Non-Assignability .

(a) Neither this Agreement nor any right or interest hereunder shall be assignable by Executive, his beneficiaries, or legal representatives without Company’s prior written consent; provided, however, that nothing in this Section 8(a) shall preclude Executive from designating a beneficiary to receive any benefit payable hereunder upon his death. Neither this Agreement nor any right or interest hereunder shall be assignable by Company, nor shall any obligations of Company hereunder be delegated.

(b) Except as required by law, no right to receive payments under this Agreement shall be subject to anticipation, commutation, alienation, safe, assignment, encumbrance, charge, pledge, or hypothecation or to exclusion, attachment, levy or similar process or assignment by operation of law, and any attempt, voluntary or involuntary, to effect any such action shall be null, void and of no effect.

9. Competition .

(a) During Executive’s employment by Company and during the two (2) year period commencing on the date the Employment Term ends for any reason whatsoever:

(i) Executive will not make any statement or perform any act intended to advance an interest of any existing or prospective competitor of Company or any of its Affiliates in any way that will or may injure an interest of Company or any of its Affiliates in its relationships and dealings with existing or potential customers or clients, or solicit or encourage any other employee of Company or any of its Affiliates to do any act that is disloyal to Company or any of its Affiliates or inconsistent with the interest of Company or any of its Affiliate’s interests or in violation of any provision of this Agreement;

(ii) Executive will not discuss with any existing or potential customers or clients of Company or any of its Affiliates the present or future availability of services or products by a business, if Executive has or expects to acquire a proprietary interest in such business or is or expects to be an employee, officer or director of such business, where such services or products are competitive with services or products which Company or any of its Affiliates provides during the Employment Term;

(iii) Executive will not make any statement or do any act intended to cause any existing or potential customers (with whom Company has made contact) or clients of Company or any of its Affiliates to make use of the services or purchase the products of any competitive business in which Executive has or expects to acquire a proprietary interest or in which Executive is or expects to be made an employee, officer or director, if such services or products in any way relate to or arise out of the services or products sold or provided by Company or any of its Affiliates to any such existing customer or client during the Employment Term;

(iv) Executive will not directly or indirectly (as a director, officer, employee, manager, consultant, independent contractor, advisor or otherwise) engage in competition with, or own any interest in, perform any services for, participate in or be connected with (A) any business or organization which engages in competition with Company or any of its Affiliates in any geographical area where any business is presently carried on by Company or any of its Affiliates, or (B) any business or organization which engages in competition with Company or any of its Affiliates in any geographical area where any business shall be hereafter, during the period of Executive’s employment by Company, carried on by Company or any of its Affiliates, if such business is then being carried on by Company or any of its Affiliates in such geographical area; provided, however, that the provisions of this Section 9(a)(iv) shall not be deemed to prohibit Executive’s ownership of not more than 1% of the total shares of all classes of stock outstanding of any publicly held company;

(v) Executive will not directly or indirectly solicit for employment, or advise or recommend to any other person that they employ or solicit for employment, any employee of Company or any of its Affiliates; and

(vi) Executive will not directly or indirectly hire, engage, send any work to, place orders with, or in any manner be associated with any supplier, contractor, subcontractor or other person or firm which rendered manufacturing or other services, or sold any products, to Company or any of its Affiliates if such action by him would have a material adverse effect on the business, assets or financial condition of Company or any of its Affiliates.

As used in clauses (ii) and (iii) above, “proprietary interest” in a business is ownership, whether through direct or indirect stock holdings or otherwise, of one percent (1%) or more of such business.

(b) For purposes of this Section 9, a person or entity (including, without limitation, Executive) shall be deemed to be a competitor of Company or any of its Affiliates, or a person or entity (including, without limitation, Executive) shall be deemed to be engaging in competition with Company or any of its Affiliates, if such person or entity in any way conducts, operates, carries out or engages (i) in the business of delivering medical oxygen, respiratory therapy services, or durable medical equipment to customers in their homes or (ii) in any other business engaged in by Company or any of its Affiliates on or prior to the date upon which such Executive ceases to be employed hereunder.

(c) In connection with the foregoing provisions of this Section 9, Executive represents that his experience, capabilities and circumstances are such that such provisions will not prevent him from earning a livelihood. Executive further agrees that the limitations set forth in this Section 9 (including, without limitation, any time or territorial limitations) are reasonable and properly required for the adequate protection of the business of Company (and of its Affiliates). It is understood and agreed that the covenants made by Executive in this Section 9 (and in Section 6 hereof) shall survive the expiration or termination of this Agreement.

(d) Executive acknowledges and agrees that a remedy at law for any breach or threatened breach of the provisions of this Section 9 would be inadequate and, therefore, agrees that Company and any of its Affiliates shall be entitled to injunctive relief in addition to any other available rights and remedies in cases of any such breach or threatened breach; provided, however, that nothing contained herein shall be construed as prohibiting Company or any of its Affiliates from pursuing any other rights and remedies available for any such breach or threatened breach.

10. Binding Effect . Without limiting or diminishing the effect of Section 8 hereof, this Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, successors, legal representatives and permitted assigns.

11. Notices . Any notice required or permitted to be given under this Agreement shall be sufficient if in writing and either delivered in person or sent by first class certified or registered mail, postage prepaid, if to Company, at Company’s principal place of business, and if to Executive, at his home address most recently filed with Company, or to such other address or addresses as either party shall have designated in writing to the other party hereto.

12. Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of Florida.

13. Legal Fees . Company shall pay Executive’s reasonable legal fees and expenses incurred in connection with the negotiation, documentation and execution of this Third Amended Employment Agreement and promptly following the execution of this Agreement. On the terms and subject to conditions set forth in Article V of the Amended and Restated By-laws of Company as in effect on the date hereof, Company shall indemnify Executive in connection with any threatened, pending or completed action, suit or proceeding brought against Executive in his capacity as a director, officer, employee or agent of Company (regardless of whether Executive is at the time still a director, officer, employee or agent of the Company) and shall pay the expenses incurred by Executive in defending any such action, suit or proceeding. The legal fees and expenses reasonably incurred by Executive in connection with successfully establishing his rights pursuant to this Section to indemnification and the payment of expenses in any such action, suit or proceeding shall also be indemnified by Company.

14. Severability . If any provision of this Agreement shall be determined to be invalid, illegal or unenforceable in whole or in part, neither the validity of the remaining part of such provision nor the validity of any other provision of this Agreement shall in any way be affected thereby.

15. Waiver . Failure to insist upon strict compliance with any of the terms, covenants or conditions hereof shall not be deemed a waiver of such term, covenant or condition, nor shall any waiver or relinquishment of any right or power hereunder at any one or more times be deemed a waiver or relinquishment of such right or power at any other time or times.

16. Entire Agreement; Modifications . This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and, except as set forth hereinafter, supersedes all prior agreements, oral and written, between the parties hereto with respect to the subject matter hereof. This Agreement may be modified or amended only by an instrument in writing signed by both parties hereto. The parties acknowledge and agree that this Agreement shall govern the employment relationship between Executive and Lincare from and after the date hereof and that the 2004 Agreement (as amended) shall govern the employment relationship between the parties prior to the date hereof. Notwithstanding the execution and delivery of this Agreement by Executive, Company shall remain obligated to pay Executive any amounts accrued under the 2004 Agreement (as amended) which remain unpaid as of the date hereof.

17. Survival . The provisions of Sections 6, 7 and 9 hereof shall survive and continue after the expiration or termination of this Agreement.

18. Counterparts . This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

19. Section 409A . This Agreement is intended to comply with the provisions of Section 409A and the Agreement shall, to the extent practicable, be construed in accordance therewith. Terms defined in the Agreement shall have the meanings given such terms under Section 409A if and to the extent required in order to comply with Section 409A. Notwithstanding the foregoing, to the extent that the Agreement or any payment or benefit hereunder shall be deemed not to comply with Section 409A, then neither Company, the Board nor its or their designees or agents shall be liable to Executive or any other person for any actions, decisions or determinations made in good faith.

[SIGNATURES ON FOLLOWING PAGE]

IN WITNESS WHEREOF, Company and Executive have duty executed and delivered this Agreement as of the day and year first above written.

Exhibit 10.2

THIRD AMENDED EMPLOYMENT AGREEMENT

THIRD AMENDED EMPLOYMENT AGREEMENT dated as of October 1, 2009, by and between LINCARE HOLDINGS INC. , a Delaware corporation (“Lincare” or “Company”), and SHAWN S. SCHABEL (“Executive”).

W I T N E S S E T H:

WHEREAS, Executive is employed by Company and is subject to the terms of that certain Employment Agreement by and between Executive and Company dated November 15, 2004, as amended January 23, 2007 and December 28, 2007 (the “2004 Agreement (as amended)”);

WHEREAS, Executive’s Initial Employment Term (as defined in the 2004 Agreement (as amended)) will expire on December 31, 2009;

WHEREAS, Company and Executive desire to amend the 2004 Agreement (as amended) to provide for the Initial Employment Term to be extended through December 31, 2012 (unless earlier terminated pursuant to the terms of this Agreement) and Company desires to induce Executive to continue in the employ of Company under the terms of this Third Amended Employment Agreement; and

WHEREAS, Executive is willing to accept such continued employment with Company on a full-time basis, all in accordance with the terms and conditions set forth below.

NOW, THEREFORE, for and in consideration of the premises hereof and the mutual covenants contained herein, the parties hereto do hereby covenant and agree as follows:

1. Employment .

(a) Company hereby agrees to continue employing Executive, and Executive hereby agrees to continue his employment with Company, for the period set forth in Section 2 hereof, all upon the terms and conditions hereinafter set forth.

(b) Executive affirms and represents that he is under no obligation to any former employer or other party which is in any way inconsistent with, or which imposes any restriction upon, Executive’s acceptance of employment hereunder with Company, the employment of Executive by Company, or Executive’s undertakings under this Agreement.

2. Term of Employment . Unless earlier terminated as hereinafter provided, the initial term of Executive’s employment under this Agreement shall be for a period beginning on January 1, 2005 and ending on December 31, 2012 (such period from January 1, 2005 until December 31, 2012 or, if Executive’s employment hereunder is earlier terminated, such shorter period, being hereinafter called the “Initial Employment Term”). In the event that Executive continues in the full-time employ of Company after the end of the Initial Employment Term (it

being expressly understood and agreed that Company has no obligation to continue employing Executive, and Executive has no obligation to continue being employed by Company, whether or not on a full-time basis, after expiration of the Initial Employment Term), then, unless otherwise expressly agreed to by Executive and Company in writing, Executive’s continued employment with Company shall, notwithstanding anything to the contrary expressed or implied herein, continue to be subject to the terms and conditions of this Agreement. As used in this Agreement, the term “Employment Term” shall mean the period beginning on January 1, 2005 and ending on the date of Executive’s cessation of employment with Company, whether such date is before, on or after the expiration of the Initial Employment Term.

3. Duties . Executive shall be employed as the President and Chief Operating Officer of Company, shall faithfully and competently perform such duties as are specified by the By-laws of Company and shall also perform and discharge such other reasonable employment duties and responsibilities as the Board of Directors of Company (the “Board”) may from time to time prescribe. Executive shall perform his duties at such places and times as the Board may reasonably prescribe. Except as may be approved herein or otherwise approved in advance by Company, and except during vacation periods and reasonable periods of absence due to sickness, personal injury or other disability, Executive shall devote his full time throughout the Employment Term to the services required of him hereunder and shall render his services exclusively to Company during the Employment Term. During the Employment Term, Executive shall use his best efforts, judgment and energy to improve and advance the business and interests of Company in a manner consistent with the duties of his position. Notwithstanding anything herein to the contrary, the provisions of this Section 3 shall not limit or restrict Executive from (i) serving as an outside director for one (1) or more corporate entities not affiliated with Company; (ii) serving as an officer or director of or otherwise participating in educational, welfare, social, religious and civic organizations; (iii) delivering lectures or fulfilling speaking engagements; or (iv) managing personal investments, in each case so long as such activities do not interfere with Executive’s ability to perform his obligations hereunder.

4. Compensation .

(a) As compensation for the complete and satisfactory performance by Executive of the services to be performed by Executive hereunder during the Employment Term commencing as of January 1, 2009, Company shall pay Executive a base salary at the annual rate equal to $598,177.00, Executive’s 2009 Salary (as computed in accordance with the 2004 Agreement (as amended)) (said amount, together with any increases thereto during the Employment Term, being hereinafter referred to as the “Salary”). Any Salary payable hereunder shall be paid in regular intervals in accordance with Company’s payroll practices. The Salary payable to Executive pursuant to this Section 4(a) shall be increased annually as of January 1, 2010, and each January 1 thereafter during the Employment Term, for the twelve (12) month period then commencing, by an amount equal to: (1) the annual percentage increase in the Consumer Price Index for All Urban Consumers, All Items, for the most recent twelve (12) month period for which such figures are then available as reported in the Monthly Labor Review published by the Bureau of Labor Statistics of the U.S. Department of Labor or (ii) such higher amount as may be determined from time to time by the Board (or an authorized committee thereof) in its sole discretion.

(b) In addition to Salary, Company shall also pay bonus compensation (“Bonus”) to Executive in respect of each calendar year (or applicable portion thereof) during the Employment Term. Such Bonus for any full calendar year will be an amount equal to the lesser of 200% of Salary or: (i) the percentage of Salary set forth in the Table below which corresponds to the percentage by which Company’s fully diluted earnings per share (“EPS”) in respect of such calendar year compares with the projected EPS of Company as set forth in the annual business plan (the “Business Plan EPS”) prepared in advance by Company and approved by the Board; multiplied by (ii) Executive’s Salary for such calendar year.

In the event that the Employment Term ends at any time other than on December 31 of any year, Executive’s Bonus in respect of such calendar year shall be prorated, and shall be an amount equal to: (i) the percentage set forth on the Table above which corresponds to the percentage by which Company’s year-to-date fully diluted EPS (as determined by the then-most recently announced fully diluted EPS of Company) compares with the figure obtained by multiplying the Business Plan EPS by a fraction, the numerator of which shall be the number of completed fiscal quarters in such calendar year for which fully diluted EPS of Company have been announced and the denominator of which shall be four (4); multiplied by (ii) Executive’s Salary for such calendar year; multiplied by (iii) a fraction, the numerator of which shall be the number of full calendar months included in the Employment Term for the then current calendar year and the denominator of which shall be twelve (12).

Notwithstanding the foregoing provisions of this Section 4(b), the Board (or an authorized committee thereof) shall have the discretion to adjust upward or downward the Business Plan EPS to account equitably for: (i) any extraordinary charges; (ii) any unusual non-recurring items; (iii) changes after the date hereof in accounting principles required under generally accepted accounting principles; or (iv) any unanticipated events or occurrences; which events impacted Company’s fully diluted EPS in respect of any such applicable period or comparable prior year period.

Nothing contained herein and no action taken in respect of any Bonus (or otherwise in respect of this Section 4(b)) shall create or be construed to create a trust of any kind. Executive’s right to receive any Bonus pursuant to this Section 4(b) shall be no greater than the right of an unsecured general creditor of Company to receive payment from Company. All Bonuses under this Section 4(b) shall be paid from the general funds of Company, and no special or separate fund shall be established, and no segregation of assets shall be made, to assure payment of any Bonuses hereunder.

(c) The payment of any Salary, Bonus or other amounts hereunder shall be subject to applicable withholding and payroll taxes, and such other deductions as may be required under Company’s employee benefit plans. Payment of Executive’s Bonus shall be made by March 15 of the year following the year to which the Bonus relates.

5. Benefits . During the Employment Term, Executive shall:

(a) be eligible to participate in all employee fringe benefits and any pension and/or profit sharing plans that may be provided by Company for its key executive employees in accordance with the provisions of any such plans, as same may be in effect on and after the date hereof;

(b) be eligible to participate in such additional perquisites and fringe benefits as may be approved from time to time by the Board (or any committee thereof) for Company’s key executives;

(c) be eligible to participate in any medical and health plans or other employee welfare benefit plans that may be provided by Company for its key executive employees in accordance with the provisions of any such plans, as same may be in effect on and after the date hereof;

(d) be entitled to annual paid vacation in accordance with Company policy that may be applicable on and after the date hereof to key executive employees;

(e) be entitled to sick leave, sick pay and disability benefits in accordance with any Company policy that may be applicable on and after the date hereof to key executive employees;

(f) be entitled to reimbursement for all reasonable and necessary out-of-pocket living and travel expenses incurred by Executive while away from his usual place of business in the performance of his duties hereunder in accordance with Company’s policies applicable on and after the date hereof in respect thereto. Notwithstanding the foregoing, (i) the expenses eligible for reimbursement may not affect the expenses eligible for reimbursement in any other taxable year, (ii) such reimbursement must be made on or before the last day of the year following the year in which the expenses was incurred, and (iii) the right to reimbursement is not subject to liquidation or exchange for another benefit; and

(g) with respect to each year in the Term beginning on or after January 1, 2010, be entitled to a cash allowance of $7,000 for financial planning services (to the extent such allowance is not used during such year, such allowance amount shall be forfeited).

6. Inventions and Confidential Information . Executive hereby covenants, agrees and acknowledges as follows:

(a) Company is engaged in a continuous program of research, design, development, production, marketing and servicing with respect to its business and that as part of Executive’s employment by Company, Executive is (or may be) expected to make new contributions and inventions of value to Company.

(b) Executive’s employment hereunder creates a relationship of confidence and trust between Executive and Company with respect to certain information pertaining to the business of Company and its Affiliates (as hereinafter defined) or pertaining to the business of any client or customer of Company or its Affiliates which may be made known to Executive by Company or any of its Affiliates or by any client or customer of Company or any of its Affiliates or learned by Executive during the course of his employment.

(c) Company possesses and will continue to possess information that has been created, discovered or developed by, or otherwise become known to it (including, without limitation, information created, discovered, developed or made known by Executive during the period of or arising out of his employment with Company) or in which property rights have been or may be assigned or otherwise conveyed to Company, which information has commercial value in the business in which Company is engaged and is treated by Company as confidential.

(d) Any and all inventions, products, discoveries, improvements, processes, manufacturing, marketing and service methods or techniques, formulae, designs, styles, specifications, data bases, computer programs (whether in source code or object code), know-how, strategies and data, whether or not patentable or registrable under copyright or similar statutes, made, developed or created by Executive (whether at the request or suggestion of Company, any of its Affiliates, or otherwise, whether alone or in conjunction with others, and whether during regular hours of work or otherwise) during the period of his employment by Company (collectively, hereinafter referred to as “Inventions”), which may pertain to the business, products, or processes of Company or any of its Affiliates, will be promptly and fully disclosed by Executive to an appropriate executive officer of Company (other than Executive) and shall be Company’s exclusive property, and Executive will promptly execute and/or deliver to an appropriate executive officer of Company (other than Executive) without any additional compensation therefor, all papers, drawings, models, data, documents and other material pertaining to or in any way relating to any Inventions made, developed or created by him as aforesaid. For the purposes of this Agreement, the term “Affiliate” or “Affiliates” of Company shall mean any corporation or other entity which is controlled, directly or indirectly, by Company. As used in the preceding sentence, the word “control” shall mean, with respect to any entity, the power to vote or direct the voting of at least 50% of the voting equity interests in such entity.

(e) Executive will keep confidential and will hold for Company’s sole benefit any Invention which is to be the exclusive property of Company under this Section 6 for which no patent, copyright, trademark or other right or protection is issued.

(f) Executive also agrees that he will not without the prior written consent of an appropriate executive officer of Company (other than Executive) use for his benefit or disclose at any time during his employment by Company, or thereafter, except to the extent

required by the performance by him of his duties as an executive of Company, any information obtained or developed by him while in the employ of Company with respect to any Inventions or with respect to any customers, clients, suppliers, products, employees, financial affairs, or methods of design, distribution, marketing, service, procurement or manufacture of Company or any of its Affiliates, or any confidential matter, except information which at the time is generally known to the public other than as a result of disclosure by him not permitted hereunder, or if such information is required to be disclosed under court order or other applicable law.

(g) Executive acknowledges and agrees that a remedy at law for any breach or threatened breach of the provisions of this Section 6 would be inadequate and, therefore, agrees that Company and its Affiliates shall be entitled to injunctive relief in addition to any other available rights and remedies in case of any such breach or threatened breach; provided, however, that nothing contained herein shall be construed as prohibiting Company or any of its Affiliates from pursuing any other rights and remedies available for any such breach or threatened breach.

(h) Executive agrees that upon termination of his employment hereunder for any reason, Executive shall forthwith return to Company all documents and other property in his possession belonging to Company or any of its Affiliates.

(i) Without limiting the generality of Section 10 hereof, Executive hereby expressly agrees that the foregoing provisions of this Section 6 shall be binding upon Executive’s heirs, successors and legal representatives.

7. Termination .

(a) The Employment Term shall end and Executive’s employment hereunder shall be terminated upon the occurrence of any of the following:

(i) the death of Executive;

(ii) termination of Executive’s employment hereunder by Company based upon the inability of Executive to perform his duties on account of disability or incapacity for a period of one hundred eighty (180) or more days, whether or not consecutive, occurring within any period of twelve (12) consecutive months; provided, however, that such employment shall not be terminated by Company if it can reasonably accommodate Executive’s disability or incapacity;

(iii) the termination of Executive’s employment hereunder by Executive at any time without “Good Reason” (including, without limitation, resignation or retirement);

(iv) the termination of Executive’s employment hereunder by Executive at any time for “Good Reason”;

(v) termination of Executive’s employment hereunder by Company at any time for “cause”, such termination to take effect immediately upon written notice from Company to Executive;

(vi) termination of Executive’s employment hereunder by Company at any time other than for “cause”, such termination to take effect immediately upon written notice from Company to Executive; or

(vii) upon a Change of Control of Company.

The following actions, failures or events by or affecting Executive shall constitute “cause” for termination within the meaning of clause (v) above: (A) conviction for having committed a felony; (B) determination by at least two-thirds of the members of the Board that Executive has committed acts of dishonesty or moral turpitude; (C) failure to follow reasonable and lawful directives of the Board; or (D) gross negligence or willful misconduct by Executive in the performance of his obligations hereunder. The term “willful” shall mean any act or failure to act taken or omitted to be taken by Executive not in good faith and without reasonable belief that the act or omission was in the best interest of Company.

As used herein, “Good Reason” shall mean the occurrence of any of the following events without Executive’s written consent: (A) a material diminution in or adverse alteration to Executive’s duties or responsibilities as set forth in Section 3 herein, (B) the relocation of Executive’s principal office outside of the area that comprises a fifty (50) mile radius from Clearwater, Florida, (C) Company requires Executive to relocate his personal place of residence or (D) a failure of Company to comply with any material provision of this Agreement (other than any such failure caused by a change in applicable law or regulation), including, without limitation, Section 4 of this Agreement; provided that the events described in clauses (A), (B), (C) and (D) above shall not constitute Good Reason (1) until Executive provides written notice to Company within ninety (90) days of his becoming aware of the occurrence of the event or circumstance giving rise to Executive’s claim of “Good Reason” and (2) actually resigns within 30 days after the end of such 90 day period unless such event or circumstance has not been cured by Company within thirty (30) days after Company’s receipt of such written notice.

As used herein the term “Change of Control of Company” shall mean any of the following: (A) sale or other disposition (or the last such sale or other disposition) resulting in the transfer of more than 50% of the outstanding common stock of Company to an unrelated and unaffiliated third party purchaser; (B) the consolidation or merger of Company or a subsidiary thereof with or into any other entity (unless immediately following such consolidation or merger, the outstanding common stock of Company immediately prior to such consolidation or merger continues to represent (either by remaining outstanding or being converted into voting securities of the resulting or surviving entity or any parent thereof) more than fifty percent (50%) of the outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such consolidation or merger (including, without limitation, a corporation that owns Company or all or substantially all of Company’s assets either directly or through one or more subsidiaries); (C) a sale of substantially all of the properties and assets of Company as an entirety to an unrelated and unaffiliated third party purchaser; or (D) the time at which any person (including a person’s affiliates and associates) or group (as that term is understood under Section 13(d) of the Exchange Act and the rules and regulations thereunder), files a Schedule 13-D or 14D-1 (or any successor schedule, form or report under the Exchange Act) disclosing that such person or group has become the beneficial owner (as defined under

Rule 13d-3 or any successor rule or regulation promulgated under the Exchange Act) of shares of capital stock of Company giving such person or group a majority of the voting power of all outstanding capital stock of Company with the right to vote generally in an election for directors or other capital stock of Company into which the common stock or other voting stock is reclassified or changed.

(b) (i) If the Employment Term ends by reason of the occurrence of an event described in either Section 7(a)(iv) or (vi) and not in connection with a Change in Control of Company, then Company shall pay to Executive, as severance pay or liquidated damages or both, an amount equal to two (2) times the sum of (A) his then-current annual Salary in effect immediately prior to such termination; plus (B) the average of the Bonus paid to or earned by Executive with respect to the three calendar years immediately preceding such termination. All amounts payable under this clause (i) shall be paid in twenty-four (24) equal monthly installments commencing on the first day of the calendar month immediately following the end of the Employment Term or such later date as is required by Section 7(e).

(ii) If the Employment Term ends by reason of the occurrence of an event described in Section 7(a)(vii) (regardless of whether Executive experiences a termination of employment), then provided that such event constitutes (i) a change in the ownership of Company (as defined in Treasury Regulation Section 1.409A-3(i)(5)(v)), (ii) a change in effective control of Company (as defined in Treasury Regulation Section 1.409A-3(1)(5)(vi)), or a change in the ownership of a substantial portion of the assets of Company (as defined in Treasury Regulation Section 1.409A-3(i)(5)(vii)), Company shall pay to Executive, as severance pay or liquidated damages or both, an amount equal to two (2) times the sum of (A) his then-current annual Salary in effect immediately prior to the occurrence of such event; plus (B) the average of the Bonus paid to or earned by Executive with respect to the three calendar years immediately preceding such termination; plus (C) an amount determined by Company, in its sole discretion, to be equal to the average annual cost for Company employees of obtaining medical, dental and vision insurance under COBRA, which amount is hereby initially determined to be Ten Thousand and No/100 Dollars ($10,000.00). All amounts payable under this clause (ii) shall be paid no later than ten (10) business days after the end of the Employment Term.

It is understood and agreed that this Section 7(b) shall survive the expiration or termination of this Agreement and the provisions hereof shall be binding upon any successor in interest of Company.

(c) Notwithstanding anything to the contrary expressed or implied herein, and except as set forth in Section 7(b) hereof, Company (and its Affiliates) shall not be obligated to make any payments to Executive or on his behalf of whatever kind or nature by reason of Executive’s cessation of employment other than: (i) such amounts, if any, of his Salary and Bonus as shall have accrued and remain unpaid as of the date the Employment Term ends (including, but not limited to, the amount of any Bonus payable in respect of the then-current calendar year), which amounts shall be paid no later than ten (10) business days after the end of the Employment Term; (ii) such other amounts which may be otherwise payable to Executive from Company’s retirement plans or other benefit plans on account of such cessation of employment (including, but not limited to, payment for any vested but unused vacation and the treatment of outstanding awards of Stock Options and Restricted Stock in accordance with the

terms applicable to such awards); and (iii) Company shall cover Executive under its medical and dental plan, and life insurance through the end of the last calendar day of the month during which the Employment Term ends, and thereafter, Executive shall be given COBRA conversion rights for Company’s medical and dental plan. Nothing in this Section 7(c) shall limit Executive’s right to contest any termination of Executive’s employment hereunder by appropriate legal proceedings. It is understood and agreed that this Section 7(c) shall survive the expiration or termination of this Agreement and the provisions hereof shall be binding upon any successor in interest of Company.

(d) No interest shall accrue on or be paid with respect to any portion of any payments hereunder so long as same are paid in accordance with the terms of this Agreement.

(e) Distributions . The following rules shall apply with respect to distribution of the payments and benefits, if any, to be provided to Executive under Section 7:

(i) It is intended that each installment of the payments and benefits provided under Section 7 shall be treated as a separate “payment” for purposes of Section 409A of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), and the guidance issued thereunder (“Section 409A”). Neither Company nor Executive shall have the right to accelerate or defer the delivery of any such payments or benefits except to the extent specifically permitted or required by Section 409A;

(ii) If, as of the date of the “separation from service” of Executive from Company, Executive is not a “specified employee” (each within the meaning of Section 409A), then each installment of the payments and benefits shall be made on the dates and terms set forth in Section 7; and

(iii) If, as of the date of the “separation from service” of Executive from Company, Executive is a “specified employee” (each, for purposes of this Agreement, within the meaning of Section 409A), then:

(A) Each installment of the payments and benefits due under Section 7 that, in accordance with the dates and terms set forth herein, will in all circumstances, regardless of when the separation from service occurs, be paid within the Short-Term Deferral Period (as hereinafter defined) shall be treated as a short-term deferral within the meaning of Treasury Regulation Section 1.409A-1(b)(4) to the maximum extent permissible under Section 409A. For purposes of this Agreement, the “Short-Term Deferral Period” means the period ending on the later of the 15th day of the third month following the end of Executive’s tax year in which Executive’s separation from service occurs and the 15th day of the third month following the end of Company’s tax year in which Executive’s separation from service occurs; and

(B) Each installment of the payments and benefits due under Section 7 that is not paid within the Short-Term Deferral Period and that would, absent this subsection, be paid within the six-month period following the “separation from service” of Executive of Company shall not be paid until the date that is six months and one day after such separation from service (or, if earlier, the death of Executive), with any such installments that are

required to be delayed being accumulated during the six-month period and paid in a lump sum on the date that is six months and one day following Executive’s separation from service and any subsequent installments, if any, being paid in accordance with the dates and terms set forth herein; provided, however, that the preceding provisions of this sentence shall not apply to any installment of payments and benefits if and to the maximum extent that that such installment is deemed to be paid under a separation pay plan that does not provide for a deferral of compensation by reason of the application of Treasury Regulation 1.409A-1(b)(9)(iii) (relating to separation pay upon an involuntary separation from service). Any installments that qualify for the exception under Treasury Regulation Section 1.409A-1(b)(9)(iii) must be paid no later than the last day of the second taxable year of Executive following the taxable year of Executive in which the separation from service occurs.

8. Non-Assignability .

(a) Neither this Agreement nor any right or interest hereunder shall be assignable by Executive, his beneficiaries, or legal representatives without Company’s prior written consent; provided, however, that nothing in this Section 8(a) shall preclude Executive from designating a beneficiary to receive any benefit payable hereunder upon his death. Neither this Agreement nor any right or interest hereunder shall be assignable by Company, nor shall any obligations of Company hereunder be delegated.

(b) Except as required by law, no right to receive payments under this Agreement shall be subject to anticipation, commutation, alienation, safe, assignment, encumbrance, charge, pledge, or hypothecation or to exclusion, attachment, levy or similar process or assignment by operation of law, and any attempt, voluntary or involuntary, to effect any such action shall be null, void and of no effect.

9. Competition .

(a) During Executive’s employment by Company and during the two (2) year period commencing on the date the Employment Term ends for any reason whatsoever:

(i) Executive will not make any statement or perform any act intended to advance an interest of any existing or prospective competitor of Company or any of its Affiliates in any way that will or may injure an interest of Company or any of its Affiliates in its relationships and dealings with existing or potential customers or clients, or solicit or encourage any other employee of Company or any of its Affiliates to do any act that is disloyal to Company or any of its Affiliates or inconsistent with the interest of Company or any of its Affiliate’s interests or in violation of any provision of this Agreement;

(ii) Executive will not discuss with any existing or potential customers or clients of Company or any of its Affiliates the present or future availability of services or products by a business, if Executive has or expects to acquire a proprietary interest in such business or is or expects to be an employee, officer or director of such business, where such services or products are competitive with services or products which Company or any of its Affiliates provides during the Employment Term;

(iii) Executive will not make any statement or do any act intended to cause any existing or potential customers (with whom Company has made contact) or clients of Company or any of its Affiliates to make use of the services or purchase the products of any competitive business in which Executive has or expects to acquire a proprietary interest or in which Executive is or expects to be made an employee, officer or director, if such services or products in any way relate to or arise out of the services or products sold or provided by Company or any of its Affiliates to any such existing customer or client during the Employment Term;

(iv) Executive will not directly or indirectly (as a director, officer, employee, manager, consultant, independent contractor, advisor or otherwise) engage in competition with, or own any interest in, perform any services for, participate in or be connected with (A) any business or organization which engages in competition with Company or any of its Affiliates in any geographical area where any business is presently carried on by Company or any of its Affiliates, or (B) any business or organization which engages in competition with Company or any of its Affiliates in any geographical area where any business shall be hereafter, during the period of Executive’s employment by Company, carried on by Company or any of its Affiliates, if such business is then being carried on by Company or any of its Affiliates in such geographical area; provided, however, that the provisions of this Section 9(a)(iv) shall not be deemed to prohibit Executive’s ownership of not more than 1% of the total shares of all classes of stock outstanding of any publicly held company;

(v) Executive will not directly or indirectly solicit for employment, or advise or recommend to any other person that they employ or solicit for employment, any employee of Company or any of its Affiliates; and

(vi) Executive will not directly or indirectly hire, engage, send any work to, place orders with, or in any manner be associated with any supplier, contractor, subcontractor or other person or firm which rendered manufacturing or other services, or sold any products, to Company or any of its Affiliates if such action by him would have a material adverse effect on the business, assets or financial condition of Company or any of its Affiliates.

As used in clauses (ii) and (iii) above, “proprietary interest” in a business is ownership, whether through direct or indirect stock holdings or otherwise, of one percent (1%) or more of such business.

(b) For purposes of this Section 9, a person or entity (including, without limitation, Executive) shall be deemed to be a competitor of Company or any of its Affiliates, or a person or entity (including, without limitation, Executive) shall be deemed to be engaging in competition with Company or any of its Affiliates, if such person or entity in any way conducts, operates, carries out or engages (i) in the business of delivering medical oxygen, respiratory therapy services, or durable medical equipment to customers in their homes or (ii) in any other business engaged in by Company or any of its Affiliates on or prior to the date upon which such Executive ceases to be employed hereunder.

(c) In connection with the foregoing provisions of this Section 9, Executive represents that his experience, capabilities and circumstances are such that such provisions will not prevent him from earning a livelihood. Executive further agrees that the limitations set forth in this Section 9 (including, without limitation, any time or territorial limitations) are reasonable and properly required for the adequate protection of the business of Company (and of its Affiliates). It is understood and agreed that the covenants made by Executive in this Section 9 (and in Section 6 hereof) shall survive the expiration or termination of this Agreement.

(d) Executive acknowledges and agrees that a remedy at law for any breach or threatened breach of the provisions of this Section 9 would be inadequate and, therefore, agrees that Company and any of its Affiliates shall be entitled to injunctive relief in addition to any other available rights and remedies in cases of any such breach or threatened breach; provided, however, that nothing contained herein shall be construed as prohibiting Company or any of its Affiliates from pursuing any other rights and remedies available for any such breach or threatened breach.

10. Binding Effect . Without limiting or diminishing the effect of Section 8 hereof, this Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, successors, legal representatives and permitted assigns.

11. Notices . Any notice required or permitted to be given under this Agreement shall be sufficient if in writing and either delivered in person or sent by first class certified or registered mail, postage prepaid, if to Company, at Company’s principal place of business, and if to Executive, at his home address most recently filed with Company, or to such other address or addresses as either party shall have designated in writing to the other party hereto.

12. Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of Florida.

13. Legal Fees . Company shall pay Executive’s reasonable legal fees and expenses incurred in connection with the negotiation, documentation and execution of this Third Amended Employment Agreement and promptly following the execution of this Agreement. On the terms and subject to conditions set forth in Article V of the Amended and Restated By-laws of Company as in effect on the date hereof, Company shall indemnify Executive in connection with any threatened, pending or completed action, suit or proceeding brought against Executive in his capacity as a director, officer, employee or agent of Company (regardless of whether Executive is at the time still a director, officer, employee or agent of the Company) and shall pay the expenses incurred by Executive in defending any such action, suit or proceeding. The legal fees and expenses reasonably incurred by Executive in connection with successfully establishing his rights pursuant to this Section to indemnification and the payment of expenses in any such action, suit or proceeding shall also be indemnified by Company.

14. Severability . If any provision of this Agreement shall be determined to be invalid, illegal or unenforceable in whole or in part, neither the validity of the remaining part of such provision nor the validity of any other provision of this Agreement shall in any way be affected thereby.

15. Waiver . Failure to insist upon strict compliance with any of the terms, covenants or conditions hereof shall not be deemed a waiver of such term, covenant or condition, nor shall any waiver or relinquishment of any right or power hereunder at any one or more times be deemed a waiver or relinquishment of such right or power at any other time or times.

16. Entire Agreement; Modifications . This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and, except as set forth hereinafter, supersedes all prior agreements, oral and written, between the parties hereto with respect to the subject matter hereof. This Agreement may be modified or amended only by an instrument in writing signed by both parties hereto. The parties acknowledge and agree that this Agreement shall govern the employment relationship between Executive and Lincare from and after the date hereof and that the 2004 Agreement (as amended) shall govern the employment relationship between the parties prior to the date hereof. Notwithstanding the execution and delivery of this Agreement by Executive, Company shall remain obligated to pay Executive any amounts accrued under the 2004 Agreement (as amended) which remain unpaid as of the date hereof.

17. Survival . The provisions of Sections 6, 7 and 9 hereof shall survive and continue after the expiration or termination of this Agreement.

18. Counterparts . This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

19. Section 409A . This Agreement is intended to comply with the provisions of Section 409A and the Agreement shall, to the extent practicable, be construed in accordance therewith. Terms defined in the Agreement shall have the meanings given such terms under Section 409A if and to the extent required in order to comply with Section 409A. Notwithstanding the foregoing, to the extent that the Agreement or any payment or benefit hereunder shall be deemed not to comply with Section 409A, then neither Company, the Board nor its or their designees or agents shall be liable to Executive or any other person for any actions, decisions or determinations made in good faith.

[SIGNATURES ON FOLLOWING PAGE]

IN WITNESS WHEREOF, Company and Executive have duty executed and delivered this Agreement as of the day and year first above written.

Exhibit 10.3

THIRD AMENDED EMPLOYMENT AGREEMENT

THIRD AMENDED EMPLOYMENT AGREEMENT dated as of October 1, 2009, by and between LINCARE HOLDINGS INC. , a Delaware corporation (“Lincare” or “Company”), and PAUL G. GABOS (“Executive”).

W I T N E S S E T H:

WHEREAS, Executive is employed by Company and is subject to the terms of that certain Employment Agreement by and between Executive and Company dated November 15, 2004, as amended January 23, 2007 and December 28, 2007 (the “2004 Agreement (as amended)”);

WHEREAS, Executive’s Initial Employment Term (as defined in the 2004 Agreement (as amended)) will expire on December 31, 2009;

WHEREAS, Company and Executive desire to amend the 2004 Agreement (as amended) to provide for the Initial Employment Term to be extended through December 31, 2012 (unless earlier terminated pursuant to the terms of this Agreement) and Company desires to induce Executive to continue in the employ of Company under the terms of this Third Amended Employment Agreement; and

WHEREAS, Executive is willing to accept such continued employment with Company on a full-time basis, all in accordance with the terms and conditions set forth below.

NOW, THEREFORE, for and in consideration of the premises hereof and the mutual covenants contained herein, the parties hereto do hereby covenant and agree as follows:

1. Employment .

(a) Company hereby agrees to continue employing Executive, and Executive hereby agrees to continue his employment with Company, for the period set forth in Section 2 hereof, all upon the terms and conditions hereinafter set forth.

(b) Executive affirms and represents that he is under no obligation to any former employer or other party which is in any way inconsistent with, or which imposes any restriction upon, Executive’s acceptance of employment hereunder with Company, the employment of Executive by Company, or Executive’s undertakings under this Agreement.

2. Term of Employment . Unless earlier terminated as hereinafter provided, the initial term of Executive’s employment under this Agreement shall be for a period beginning on January 1, 2005 and ending on December 31, 2012 (such period from January 1, 2005 until December 31, 2012 or, if Executive’s employment hereunder is earlier terminated, such shorter period, being hereinafter called the “Initial Employment Term”). In the event that Executive continues in the full-time employ of Company after the end of the Initial Employment Term (it

being expressly understood and agreed that Company has no obligation to continue employing Executive, and Executive has no obligation to continue being employed by Company, whether or not on a full-time basis, after expiration of the Initial Employment Term), then, unless otherwise expressly agreed to by Executive and Company in writing, Executive’s continued employment with Company shall, notwithstanding anything to the contrary expressed or implied herein, continue to be subject to the terms and conditions of this Agreement. As used in this Agreement, the term “Employment Term” shall mean the period beginning on January 1, 2005 and ending on the date of Executive’s cessation of employment with Company, whether such date is before, on or after the expiration of the Initial Employment Term.

3. Duties . Executive shall be employed as the Chief Financial Officer and Secretary of Company, shall faithfully and competently perform such duties as are specified by the By-laws of Company and shall also perform and discharge such other reasonable employment duties and responsibilities as the Board of Directors of Company (the “Board”) may from time to time prescribe. Executive shall perform his duties at such places and times as the Board may reasonably prescribe. Except as may be approved herein or otherwise approved in advance by Company, and except during vacation periods and reasonable periods of absence due to sickness, personal injury or other disability, Executive shall devote his full time throughout the Employment Term to the services required of him hereunder and shall render his services exclusively to Company during the Employment Term. During the Employment Term, Executive shall use his best efforts, judgment and energy to improve and advance the business and interests of Company in a manner consistent with the duties of his position. Notwithstanding anything herein to the contrary, the provisions of this Section 3 shall not limit or restrict Executive from (i) serving as an outside director for one (1) or more corporate entities not affiliated with Company; (ii) serving as an officer or director of or otherwise participating in educational, welfare, social, religious and civic organizations; (iii) delivering lectures or fulfilling speaking engagements; or (iv) managing personal investments, in each case so long as such activities do not interfere with Executive’s ability to perform his obligations hereunder.

4. Compensation .

(a) As compensation for the complete and satisfactory performance by Executive of the services to be performed by Executive hereunder during the Employment Term commencing as of January 1, 2009, Company shall pay Executive a base salary at the annual rate equal to $448,408.00, Executive’s 2009 Salary (as computed in accordance with the 2004 Agreement (as amended)) (said amount, together with any increases thereto during the Employment Term, being hereinafter referred to as the “Salary”). Any Salary payable hereunder shall be paid in regular intervals in accordance with Company’s payroll practices. The Salary payable to Executive pursuant to this Section 4(a) shall be increased annually as of January 1, 2010, and each January 1 thereafter during the Employment Term, for the twelve (12) month period then commencing, by an amount equal to: (1) the annual percentage increase in the Consumer Price Index for All Urban Consumers, All Items, for the most recent twelve (12) month period for which such figures are then available as reported in the Monthly Labor Review published by the Bureau of Labor Statistics of the U.S. Department of Labor or (ii) such higher amount as may be determined from time to time by the Board (or an authorized committee thereof) in its sole discretion.

(b) In addition to Salary, Company shall also pay bonus compensation (“Bonus”) to Executive in respect of each calendar year (or applicable portion thereof) during the Employment Term. Such Bonus for any full calendar year will be an amount equal to the lesser of 200% of Salary or: (i) the percentage of Salary set forth in the Table below which corresponds to the percentage by which Company’s fully diluted earnings per share (“EPS”) in respect of such calendar year compares with the projected EPS of Company as set forth in the annual business plan (the “Business Plan EPS”) prepared in advance by Company and approved by the Board; multiplied by (ii) Executive’s Salary for such calendar year.

In the event that the Employment Term ends at any time other than on December 31 of any year, Executive’s Bonus in respect of such calendar year shall be prorated, and shall be an amount equal to: (i) the percentage set forth on the Table above which corresponds to the percentage by which Company’s year-to-date fully diluted EPS (as determined by the then-most recently announced fully diluted EPS of Company) compares with the figure obtained by multiplying the Business Plan EPS by a fraction, the numerator of which shall be the number of completed fiscal quarters in such calendar year for which fully diluted EPS of Company have been announced and the denominator of which shall be four (4); multiplied by (ii) Executive’s Salary for such calendar year; multiplied by (iii) a fraction, the numerator of which shall be the number of full calendar months included in the Employment Term for the then current calendar year and the denominator of which shall be twelve (12).

Notwithstanding the foregoing provisions of this Section 4(b), the Board (or an authorized committee thereof) shall have the discretion to adjust upward or downward the Business Plan EPS to account equitably for: (i) any extraordinary charges; (ii) any unusual non-recurring items; (iii) changes after the date hereof in accounting principles required under generally accepted accounting principles; or (iv) any unanticipated events or occurrences; which events impacted Company’s fully diluted EPS in respect of any such applicable period or comparable prior year period.

Nothing contained herein and no action taken in respect of any Bonus (or otherwise in respect of this Section 4(b)) shall create or be construed to create a trust of any kind. Executive’s right to receive any Bonus pursuant to this Section 4(b) shall be no greater than the right of an unsecured general creditor of Company to receive payment from Company. All Bonuses under this Section 4(b) shall be paid from the general funds of Company, and no special or separate fund shall be established, and no segregation of assets shall be made, to assure payment of any Bonuses hereunder.

(c) The payment of any Salary, Bonus or other amounts hereunder shall be subject to applicable withholding and payroll taxes, and such other deductions as may be required under Company’s employee benefit plans. Payment of Executive’s Bonus shall be made by March 15 of the year following the year to which the Bonus relates.

5. Benefits . During the Employment Term, Executive shall:

(a) be eligible to participate in all employee fringe benefits and any pension and/or profit sharing plans that may be provided by Company for its key executive employees in accordance with the provisions of any such plans, as same may be in effect on and after the date hereof;

(b) be eligible to participate in such additional perquisites and fringe benefits as may be approved from time to time by the Board (or any committee thereof) for Company’s key executives;

(c) be eligible to participate in any medical and health plans or other employee welfare benefit plans that may be provided by Company for its key executive employees in accordance with the provisions of any such plans, as same may be in effect on and after the date hereof;

(d) be entitled to annual paid vacation in accordance with Company policy that may be applicable on and after the date hereof to key executive employees;

(e) be entitled to sick leave, sick pay and disability benefits in accordance with any Company policy that may be applicable on and after the date hereof to key executive employees;

(f) be entitled to reimbursement for all reasonable and necessary out-of-pocket living and travel expenses incurred by Executive while away from his usual place of business in the performance of his duties hereunder in accordance with Company’s policies applicable on and after the date hereof in respect thereto. Notwithstanding the foregoing, (i) the expenses eligible for reimbursement may not affect the expenses eligible for reimbursement in any other taxable year, (ii) such reimbursement must be made on or before the last day of the year following the year in which the expenses was incurred, and (iii) the right to reimbursement is not subject to liquidation or exchange for another benefit; and

(g) with respect to each year in the Term beginning on or after January 1, 2010, be entitled to a cash allowance of $7,000 for financial planning services (to the extent such allowance is not used during such year, such allowance amount shall be forfeited).

6. Inventions and Confidential Information . Executive hereby covenants, agrees and acknowledges as follows:

(a) Company is engaged in a continuous program of research, design, development, production, marketing and servicing with respect to its business and that as part of Executive’s employment by Company, Executive is (or may be) expected to make new contributions and inventions of value to Company.

(b) Executive’s employment hereunder creates a relationship of confidence and trust between Executive and Company with respect to certain information pertaining to the business of Company and its Affiliates (as hereinafter defined) or pertaining to the business of any client or customer of Company or its Affiliates which may be made known to Executive by Company or any of its Affiliates or by any client or customer of Company or any of its Affiliates or learned by Executive during the course of his employment.

(c) Company possesses and will continue to possess information that has been created, discovered or developed by, or otherwise become known to it (including, without limitation, information created, discovered, developed or made known by Executive during the period of or arising out of his employment with Company) or in which property rights have been or may be assigned or otherwise conveyed to Company, which information has commercial value in the business in which Company is engaged and is treated by Company as confidential.

(d) Any and all inventions, products, discoveries, improvements, processes, manufacturing, marketing and service methods or techniques, formulae, designs, styles, specifications, data bases, computer programs (whether in source code or object code), know-how, strategies and data, whether or not patentable or registrable under copyright or similar statutes, made, developed or created by Executive (whether at the request or suggestion of Company, any of its Affiliates, or otherwise, whether alone or in conjunction with others, and whether during regular hours of work or otherwise) during the period of his employment by Company (collectively, hereinafter referred to as “Inventions”), which may pertain to the business, products, or processes of Company or any of its Affiliates, will be promptly and fully disclosed by Executive to an appropriate executive officer of Company (other than Executive) and shall be Company’s exclusive property, and Executive will promptly execute and/or deliver to an appropriate executive officer of Company (other than Executive) without any additional compensation therefor, all papers, drawings, models, data, documents and other material pertaining to or in any way relating to any Inventions made, developed or created by him as aforesaid. For the purposes of this Agreement, the term “Affiliate” or “Affiliates” of Company shall mean any corporation or other entity which is controlled, directly or indirectly, by Company. As used in the preceding sentence, the word “control” shall mean, with respect to any entity, the power to vote or direct the voting of at least 50% of the voting equity interests in such entity.

(e) Executive will keep confidential and will hold for Company’s sole benefit any Invention which is to be the exclusive property of Company under this Section 6 for which no patent, copyright, trademark or other right or protection is issued.

(f) Executive also agrees that he will not without the prior written consent of an appropriate executive officer of Company (other than Executive) use for his benefit or disclose at any time during his employment by Company, or thereafter, except to the extent

required by the performance by him of his duties as an executive of Company, any information obtained or developed by him while in the employ of Company with respect to any Inventions or with respect to any customers, clients, suppliers, products, employees, financial affairs, or methods of design, distribution, marketing, service, procurement or manufacture of Company or any of its Affiliates, or any confidential matter, except information which at the time is generally known to the public other than as a result of disclosure by him not permitted hereunder, or if such information is required to be disclosed under court order or other applicable law.

(g) Executive acknowledges and agrees that a remedy at law for any breach or threatened breach of the provisions of this Section 6 would be inadequate and, therefore, agrees that Company and its Affiliates shall be entitled to injunctive relief in addition to any other available rights and remedies in case of any such breach or threatened breach; provided, however, that nothing contained herein shall be construed as prohibiting Company or any of its Affiliates from pursuing any other rights and remedies available for any such breach or threatened breach.

(h) Executive agrees that upon termination of his employment hereunder for any reason, Executive shall forthwith return to Company all documents and other property in his possession belonging to Company or any of its Affiliates.

(i) Without limiting the generality of Section 10 hereof, Executive hereby expressly agrees that the foregoing provisions of this Section 6 shall be binding upon Executive’s heirs, successors and legal representatives.

7. Termination .

(a) The Employment Term shall end and Executive’s employment hereunder shall be terminated upon the occurrence of any of the following:

(i) the death of Executive;

(ii) termination of Executive’s employment hereunder by Company based upon the inability of Executive to perform his duties on account of disability or incapacity for a period of one hundred eighty (180) or more days, whether or not consecutive, occurring within any period of twelve (12) consecutive months; provided, however, that such employment shall not be terminated by Company if it can reasonably accommodate Executive’s disability or incapacity;

(iii) the termination of Executive’s employment hereunder by Executive at any time without “Good Reason” (including, without limitation, resignation or retirement);

(iv) the termination of Executive’s employment hereunder by Executive at any time for “Good Reason”;

(v) termination of Executive’s employment hereunder by Company at any time for “cause”, such termination to take effect immediately upon written notice from Company to Executive;

(vi) termination of Executive’s employment hereunder by Company at any time other than for “cause”, such termination to take effect immediately upon written notice from Company to Executive; or

(vii) upon a Change of Control of Company.

The following actions, failures or events by or affecting Executive shall constitute “cause” for termination within the meaning of clause (v) above: (A) conviction for having committed a felony; (B) determination by at least two-thirds of the members of the Board that Executive has committed acts of dishonesty or moral turpitude; (C) failure to follow reasonable and lawful directives of the Board; or (D) gross negligence or willful misconduct by Executive in the performance of his obligations hereunder. The term “willful” shall mean any act or failure to act taken or omitted to be taken by Executive not in good faith and without reasonable belief that the act or omission was in the best interest of Company.

As used herein, “Good Reason” shall mean the occurrence of any of the following events without Executive’s written consent: (A) a material diminution in or adverse alteration to Executive’s duties or responsibilities as set forth in Section 3 herein, (B) the relocation of Executive’s principal office outside of the area that comprises a fifty (50) mile radius from Clearwater, Florida, (C) Company requires Executive to relocate his personal place of residence or (D) a failure of Company to comply with any material provision of this Agreement (other than any such failure caused by a change in applicable law or regulation), including, without limitation, Section 4 of this Agreement; provided that the events described in clauses (A), (B), (C) and (D) above shall not constitute Good Reason (1) until Executive provides written notice to Company within ninety (90) days of his becoming aware of the occurrence of the event or circumstance giving rise to Executive’s claim of “Good Reason” and (2) actually resigns within 30 days after the end of such 90 day period unless such event or circumstance has not been cured by Company within thirty (30) days after Company’s receipt of such written notice.

As used herein the term “Change of Control of Company” shall mean any of the following: (A) sale or other disposition (or the last such sale or other disposition) resulting in the transfer of more than 50% of the outstanding common stock of Company to an unrelated and unaffiliated third party purchaser; (B) the consolidation or merger of Company or a subsidiary thereof with or into any other entity (unless immediately following such consolidation or merger, the outstanding common stock of Company immediately prior to such consolidation or merger continues to represent (either by remaining outstanding or being converted into voting securities of the resulting or surviving entity or any parent thereof) more than fifty percent (50%) of the outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such consolidation or merger (including, without limitation, a corporation that owns Company or all or substantially all of Company’s assets either directly or through one or more subsidiaries); (C) a sale of substantially all of the properties and assets of Company as an entirety to an unrelated and unaffiliated third party purchaser; or (D) the time at which any person (including a person’s affiliates and associates) or group (as that term is understood under Section 13(d) of the Exchange Act and the rules and regulations thereunder), files a Schedule 13-D or 14D-1 (or any successor schedule, form or report under the Exchange Act) disclosing that such person or group has become the beneficial owner (as defined under

Rule 13d-3 or any successor rule or regulation promulgated under the Exchange Act) of shares of capital stock of Company giving such person or group a majority of the voting power of all outstanding capital stock of Company with the right to vote generally in an election for directors or other capital stock of Company into which the common stock or other voting stock is reclassified or changed.

(b)(i) If the Employment Term ends by reason of the occurrence of an event described in either Section 7(a)(iv) or (vi) and not in connection with a Change in Control of Company, then Company shall pay to Executive, as severance pay or liquidated damages or both, an amount equal to two (2) times the sum of (A) his then-current annual Salary in effect immediately prior to such termination; plus (B) the average of the Bonus paid to or earned by Executive with respect to the three calendar years immediately preceding such termination. All amounts payable under this clause (i) shall be paid in twenty-four (24) equal monthly installments commencing on the first day of the calendar month immediately following the end of the Employment Term or such later date as is required by Section 7(e).

(ii) If the Employment Term ends by reason of the occurrence of an event described in Section 7(a)(vii) (regardless of whether Executive experiences a termination of employment), then provided that such event constitutes (i) a change in the ownership of Company (as defined in Treasury Regulation Section 1.409A-3(i)(5)(v)), (ii) a change in effective control of Company (as defined in Treasury Regulation Section 1.409A-3(1)(5)(vi)), or a change in the ownership of a substantial portion of the assets of Company (as defined in Treasury Regulation Section 1.409A-3(i)(5)(vii)), Company shall pay to Executive, as severance pay or liquidated damages or both, an amount equal to two (2) times the sum of (A) his then-current annual Salary in effect immediately prior to the occurrence of such event; plus (B) the average of the Bonus paid to or earned by Executive with respect to the three calendar years immediately preceding such termination; plus (C) an amount determined by Company, in its sole discretion, to be equal to the average annual cost for Company employees of obtaining medical, dental and vision insurance under COBRA, which amount is hereby initially determined to be Ten Thousand and No/100 Dollars ($10,000.00). All amounts payable under this clause (ii) shall be paid no later than ten (10) business days after the end of the Employment Term.

It is understood and agreed that this Section 7(b) shall survive the expiration or termination of this Agreement and the provisions hereof shall be binding upon any successor in interest of Company.

(c) Notwithstanding anything to the contrary expressed or implied herein, and except as set forth in Section 7(b) hereof, Company (and its Affiliates) shall not be obligated to make any payments to Executive or on his behalf of whatever kind or nature by reason of Executive’s cessation of employment other than: (i) such amounts, if any, of his Salary and Bonus as shall have accrued and remain unpaid as of the date the Employment Term ends (including, but not limited to, the amount of any Bonus payable in respect of the then-current calendar year), which amounts shall be paid no later than ten (10) business days after the end of the Employment Term; (ii) such other amounts which may be otherwise payable to Executive from Company’s retirement plans or other benefit plans on account of such cessation of employment (including, but not limited to, payment for any vested but unused vacation and the treatment of outstanding awards of Stock Options and Restricted Stock in accordance with the

terms applicable to such awards); and (iii) Company shall cover Executive under its medical and dental plan, and life insurance through the end of the last calendar day of the month during which the Employment Term ends, and thereafter, Executive shall be given COBRA conversion rights for Company’s medical and dental plan. Nothing in this Section 7(c) shall limit Executive’s right to contest any termination of Executive’s employment hereunder by appropriate legal proceedings. It is understood and agreed that this Section 7(c) shall survive the expiration or termination of this Agreement and the provisions hereof shall be binding upon any successor in interest of Company.

(d) No interest shall accrue on or be paid with respect to any portion of any payments hereunder so long as same are paid in accordance with the terms of this Agreement.

(e) Distributions . The following rules shall apply with respect to distribution of the payments and benefits, if any, to be provided to Executive under Section 7:

(i) It is intended that each installment of the payments and benefits provided under Section 7 shall be treated as a separate “payment” for purposes of Section 409A of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), and the guidance issued thereunder (“Section 409A”). Neither Company nor Executive shall have the right to accelerate or defer the delivery of any such payments or benefits except to the extent specifically permitted or required by Section 409A;

(ii) If, as of the date of the “separation from service” of Executive from Company, Executive is not a “specified employee” (each within the meaning of Section 409A), then each installment of the payments and benefits shall be made on the dates and terms set forth in Section 7; and

(iii) If, as of the date of the “separation from service” of Executive from Company, Executive is a “specified employee” (each, for purposes of this Agreement, within the meaning of Section 409A), then:

(A) Each installment of the payments and benefits due under Section 7 that, in accordance with the dates and terms set forth herein, will in all circumstances, regardless of when the separation from service occurs, be paid within the Short-Term Deferral Period (as hereinafter defined) shall be treated as a short-term deferral within the meaning of Treasury Regulation Section 1.409A-1(b)(4) to the maximum extent permissible under Section 409A. For purposes of this Agreement, the “Short-Term Deferral Period” means the period ending on the later of the 15th day of the third month following the end of Executive’s tax year in which Executive’s separation from service occurs and the 15th day of the third month following the end of Company’s tax year in which Executive’s separation from service occurs; and

(B) Each installment of the payments and benefits due under Section 7 that is not paid within the Short-Term Deferral Period and that would, absent this subsection, be paid within the six-month period following the “separation from service” of Executive of Company shall not be paid until the date that is six months and one day after such separation from service (or, if earlier, the death of Executive), with any such installments that are

required to be delayed being accumulated during the six-month period and paid in a lump sum on the date that is six months and one day following Executive’s separation from service and any subsequent installments, if any, being paid in accordance with the dates and terms set forth herein; provided, however, that the preceding provisions of this sentence shall not apply to any installment of payments and benefits if and to the maximum extent that that such installment is deemed to be paid under a separation pay plan that does not provide for a deferral of compensation by reason of the application of Treasury Regulation 1.409A-1(b)(9)(iii) (relating to separation pay upon an involuntary separation from service). Any installments that qualify for the exception under Treasury Regulation Section 1.409A-1(b)(9)(iii) must be paid no later than the last day of the second taxable year of Executive following the taxable year of Executive in which the separation from service occurs.

8. Non-Assignability .

(a) Neither this Agreement nor any right or interest hereunder shall be assignable by Executive, his beneficiaries, or legal representatives without Company’s prior written consent; provided, however, that nothing in this Section 8(a) shall preclude Executive from designating a beneficiary to receive any benefit payable hereunder upon his death. Neither this Agreement nor any right or interest hereunder shall be assignable by Company, nor shall any obligations of Company hereunder be delegated.

(b) Except as required by law, no right to receive payments under this Agreement shall be subject to anticipation, commutation, alienation, safe, assignment, encumbrance, charge, pledge, or hypothecation or to exclusion, attachment, levy or similar process or assignment by operation of law, and any attempt, voluntary or involuntary, to effect any such action shall be null, void and of no effect.

9. Competition .

(a) During Executive’s employment by Company and during the two (2) year period commencing on the date the Employment Term ends for any reason whatsoever:

(i) Executive will not make any statement or perform any act intended to advance an interest of any existing or prospective competitor of Company or any of its Affiliates in any way that will or may injure an interest of Company or any of its Affiliates in its relationships and dealings with existing or potential customers or clients, or solicit or encourage any other employee of Company or any of its Affiliates to do any act that is disloyal to Company or any of its Affiliates or inconsistent with the interest of Company or any of its Affiliate’s interests or in violation of any provision of this Agreement;

(ii) Executive will not discuss with any existing or potential customers or clients of Company or any of its Affiliates the present or future availability of services or products by a business, if Executive has or expects to acquire a proprietary interest in such business or is or expects to be an employee, officer or director of such business, where such services or products are competitive with services or products which Company or any of its Affiliates provides during the Employment Term;

(iii) Executive will not make any statement or do any act intended to cause any existing or potential customers (with whom Company has made contact) or clients of Company or any of its Affiliates to make use of the services or purchase the products of any competitive business in which Executive has or expects to acquire a proprietary interest or in which Executive is or expects to be made an employee, officer or director, if such services or products in any way relate to or arise out of the services or products sold or provided by Company or any of its Affiliates to any such existing customer or client during the Employment Term;

(iv) Executive will not directly or indirectly (as a director, officer, employee, manager, consultant, independent contractor, advisor or otherwise) engage in competition with, or own any interest in, perform any services for, participate in or be connected with (A) any business or organization which engages in competition with Company or any of its Affiliates in any geographical area where any business is presently carried on by Company or any of its Affiliates, or (B) any business or organization which engages in competition with Company or any of its Affiliates in any geographical area where any business shall be hereafter, during the period of Executive’s employment by Company, carried on by Company or any of its Affiliates, if such business is then being carried on by Company or any of its Affiliates in such geographical area; provided, however, that the provisions of this Section 9(a)(iv) shall not be deemed to prohibit Executive’s ownership of not more than 1% of the total shares of all classes of stock outstanding of any publicly held company;

(v) Executive will not directly or indirectly solicit for employment, or advise or recommend to any other person that they employ or solicit for employment, any employee of Company or any of its Affiliates; and

(vi) Executive will not directly or indirectly hire, engage, send any work to, place orders with, or in any manner be associated with any supplier, contractor, subcontractor or other person or firm which rendered manufacturing or other services, or sold any products, to Company or any of its Affiliates if such action by him would have a material adverse effect on the business, assets or financial condition of Company or any of its Affiliates.

As used in clauses (ii) and (iii) above, “proprietary interest” in a business is ownership, whether through direct or indirect stock holdings or otherwise, of one percent (1%) or more of such business.

(b) For purposes of this Section 9, a person or entity (including, without limitation, Executive) shall be deemed to be a competitor of Company or any of its Affiliates, or a person or entity (including, without limitation, Executive) shall be deemed to be engaging in competition with Company or any of its Affiliates, if such person or entity in any way conducts, operates, carries out or engages (i) in the business of delivering medical oxygen, respiratory therapy services, or durable medical equipment to customers in their homes or (ii) in any other business engaged in by Company or any of its Affiliates on or prior to the date upon which such Executive ceases to be employed hereunder.

(c) In connection with the foregoing provisions of this Section 9, Executive represents that his experience, capabilities and circumstances are such that such provisions will not prevent him from earning a livelihood. Executive further agrees that the limitations set forth in this Section 9 (including, without limitation, any time or territorial limitations) are reasonable and properly required for the adequate protection of the business of Company (and of its Affiliates). It is understood and agreed that the covenants made by Executive in this Section 9 (and in Section 6 hereof) shall survive the expiration or termination of this Agreement.

(d) Executive acknowledges and agrees that a remedy at law for any breach or threatened breach of the provisions of this Section 9 would be inadequate and, therefore, agrees that Company and any of its Affiliates shall be entitled to injunctive relief in addition to any other available rights and remedies in cases of any such breach or threatened breach; provided, however, that nothing contained herein shall be construed as prohibiting Company or any of its Affiliates from pursuing any other rights and remedies available for any such breach or threatened breach.

10. Binding Effect . Without limiting or diminishing the effect of Section 8 hereof, this Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, successors, legal representatives and permitted assigns.

11. Notices . Any notice required or permitted to be given under this Agreement shall be sufficient if in writing and either delivered in person or sent by first class certified or registered mail, postage prepaid, if to Company, at Company’s principal place of business, and if to Executive, at his home address most recently filed with Company, or to such other address or addresses as either party shall have designated in writing to the other party hereto.

12. Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of Florida.

13. Legal Fees . Company shall pay Executive’s reasonable legal fees and expenses incurred in connection with the negotiation, documentation and execution of this Third Amended Employment Agreement and promptly following the execution of this Agreement. On the terms and subject to conditions set forth in Article V of the Amended and Restated By-laws of Company as in effect on the date hereof, Company shall indemnify Executive in connection with any threatened, pending or completed action, suit or proceeding brought against Executive in his capacity as a director, officer, employee or agent of Company (regardless of whether Executive is at the time still a director, officer, employee or agent of the Company) and shall pay the expenses incurred by Executive in defending any such action, suit or proceeding. The legal fees and expenses reasonably incurred by Executive in connection with successfully establishing his rights pursuant to this Section to indemnification and the payment of expenses in any such action, suit or proceeding shall also be indemnified by Company.

14. Severability . If any provision of this Agreement shall be determined to be invalid, illegal or unenforceable in whole or in part, neither the validity of the remaining part of such provision nor the validity of any other provision of this Agreement shall in any way be affected thereby.

15. Waiver . Failure to insist upon strict compliance with any of the terms, covenants or conditions hereof shall not be deemed a waiver of such term, covenant or condition, nor shall any waiver or relinquishment of any right or power hereunder at any one or more times be deemed a waiver or relinquishment of such right or power at any other time or times.

16. Entire Agreement; Modifications . This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and, except as set forth hereinafter, supersedes all prior agreements, oral and written, between the parties hereto with respect to the subject matter hereof. This Agreement may be modified or amended only by an instrument in writing signed by both parties hereto. The parties acknowledge and agree that this Agreement shall govern the employment relationship between Executive and Lincare from and after the date hereof and that the 2004 Agreement (as amended) shall govern the employment relationship between the parties prior to the date hereof. Notwithstanding the execution and delivery of this Agreement by Executive, Company shall remain obligated to pay Executive any amounts accrued under the 2004 Agreement (as amended) which remain unpaid as of the date hereof.

17. Survival . The provisions of Sections 6, 7 and 9 hereof shall survive and continue after the expiration or termination of this Agreement.

18. Counterparts . This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

19. Section 409A . This Agreement is intended to comply with the provisions of Section 409A and the Agreement shall, to the extent practicable, be construed in accordance therewith. Terms defined in the Agreement shall have the meanings given such terms under Section 409A if and to the extent required in order to comply with Section 409A. Notwithstanding the foregoing, to the extent that the Agreement or any payment or benefit hereunder shall be deemed not to comply with Section 409A, then neither Company, the Board nor its or their designees or agents shall be liable to Executive or any other person for any actions, decisions or determinations made in good faith.

[SIGNATURES ON FOLLOWING PAGE]

IN WITNESS WHEREOF, Company and Executive have duty executed and delivered this Agreement as of the day and year first above written.

Exhibit 10.4

LINCARE HOLDINGS INC.

RESTRICTED STOCK AGREEMENT

THIS AGREEMENT made this 1st day of October, 2009, between Lincare Holdings Inc., a Delaware corporation (the “Company”), and John P. Byrnes (the “Participant”).

For valuable consideration, receipt of which is acknowledged, the parties hereto agree as follows:

1. Purchase of Shares .

The Company shall issue and sell to the Participant, and the Participant shall purchase from the Company, subject to the terms and conditions set forth in this Agreement and in the Company’s 2007 Stock Plan (the “Plan”), 440,000 shares (the “Shares”) of Common Stock, $.01 par value, of the Company (“Common Stock”), at a purchase price of $0.01 per share. The aggregate purchase price for the Shares shall be paid by the Participant by check payable to the order of the Company or such other method as may be acceptable to the Company. Upon receipt by the Company of payment for the Shares, the Company shall issue to the Participant one or more certificates in the name of the Participant for that number of Shares purchased by the Participant. The Participant agrees that the Shares shall be subject to the purchase option set forth in Section 2 of this Agreement and the restrictions on transfer set forth in Section 4 of this Agreement.

2. Purchase Option .

(a) In the event that the Participant ceases to be employed by the Company for any reason or no reason, with or without cause, prior to November 1, 2012, the Company shall have the right and option (the “Purchase Option”) to purchase from the Participant, for a sum of $0.01 per share (the “Option Price”), some or all of the Unvested Shares (as defined below).

“Unvested Shares” means the total number of Shares multiplied by the Applicable Percentage at the time the Purchase Option becomes exercisable by the Company. The “Applicable Percentage” shall be (i) 100% during the period commencing on the date hereof and ending on October 31, 2012 and (ii) zero, on or after November 1, 2012; provided , however, that the

Applicable Percentage shall be zero if the Participant’s employment with the Company is terminated pursuant to Section 7(a)(i), (ii), (iv), (vi) or (vii) of the Third Amended Employment Agreement, dated as of October 1, 2009 (the “Employment Agreement”), between the Company and the Participant. The Compensation Committee of the Board of Directors, in its sole discretion, may at any time accelerate the time set forth herein for the vesting of the Shares.

(b) For purposes of this Agreement, employment with the Company shall include employment with a parent or subsidiary of the Company.

3. Exercise of Purchase Option and Closing .

(a) The Company may exercise the Purchase Option by delivering or mailing to the Participant, within 90 days after the termination of the employment of the Participant with the Company, a written notice of exercise of the Purchase Option. Such notice shall specify the number of Shares to be purchased. If and to the extent the Purchase Option is not so exercised by the giving of such a notice within such 90-day period, the Purchase Option shall automatically expire and terminate effective upon the expiration of such 90-day period.

(b) Within 10 days after delivery to the Participant of the Company’s notice of the exercise of the Purchase Option pursuant to subsection (a) above, the Participant shall, pursuant to the provisions of the Joint Escrow Instructions referred to in Section 5 below, tender to the Company at its principal offices the certificate or certificates representing the Shares that the Company has elected to purchase in accordance with the terms of this Agreement, duly endorsed in blank or with duly endorsed stock powers attached thereto, all in form suitable for the transfer of such Shares to the Company. Promptly following its receipt of such certificate or certificates, the Company shall pay to the Participant the aggregate Option Price for such Shares (provided that any delay in making such payment shall not invalidate the Company’s exercise of the Purchase Option with respect to such Shares).

(c) After the time at which any Shares are required to be delivered to the Company for transfer to the Company pursuant to subsection (b) above, the Company shall not pay any dividend to the Participant on account of such Shares or permit the Participant to exercise any of the privileges or rights of a stockholder with respect to such Shares, but shall, in so far as permitted by law, treat the Company as the owner of such Shares.

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(d) The Option Price may be payable, at the option of the Company, in cash, by check or both.

(e) The Company shall not purchase any fraction of a Share upon exercise of the Purchase Option, and any fraction of a Share resulting from a computation made pursuant to Section 2 of this Agreement shall be rounded to the nearest whole Share (with any one-half Share being rounded upward).

(f) The Company may assign its Purchase Option to one or more persons or entities.

4. Restrictions on Transfer .

The Participant shall not sell, assign, transfer, pledge, hypothecate or otherwise dispose of, by operation of law or otherwise (collectively “transfer”) any Shares, or any interest therein, that are subject to the Purchase Option, except that the Participant may transfer such Shares (i) to or for the benefit of any spouse, children, parents, uncles, aunts, siblings, grandchildren and any other relatives approved by the Board of Directors (collectively, “Approved Relatives”) or to a trust established solely for the benefit of the Participant and/or Approved Relatives, provided that such Shares shall remain subject to this Agreement (including without limitation the restrictions on transfer set forth in this Section 4, the Purchase Option and the right of first refusal set forth in Section 5) and such permitted transferee shall, as a condition to such transfer, deliver to the Company a written instrument confirming that such transferee shall be bound by all of the terms and conditions of this Agreement or (ii) as part of the sale of all or substantially all of the shares of capital stock of the Company (including pursuant to a merger or consolidation), provided that, in accordance with the Plan, the securities or other property received by the Participant in connection with such transaction shall remain subject to this Agreement unless such transaction is a Change of Control (as defined in the Employment Agreement).

5. Escrow .

The Participant shall, upon the execution of this Agreement, execute Joint Escrow Instructions in the form attached to this Agreement as Exhibit A . The Joint Escrow Instructions shall be delivered to the Director – Employee Relations of the Company, as escrow agent thereunder. The

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Participant shall deliver to such escrow agent a stock assignment duly endorsed in blank, in the form attached to this Agreement as Exhibit B , and hereby instructs the Company to deliver to such escrow agent, on behalf of the Participant, the certificate(s) evidencing the Shares issued hereunder. Such materials shall be held by such escrow agent pursuant to the terms of such Joint Escrow Instructions.

6. Restrictive Legend .

All certificates representing Shares shall have affixed thereto a legend in substantially the following form, in addition to any other legends that may be required under federal or state securities laws:

“The shares of stock represented by this certificate are subject to restrictions on transfer and an option to purchase set forth in a certain Restricted Stock Agreement between the corporation and the registered owner of these shares (or his predecessor in interest), and such Agreement is available for inspection without charge at the office of the Secretary of the corporation.”

7. Provisions of the Plan .

(a) This Agreement is subject to the provisions of the Plan, a copy of which is furnished to the Participant with this Agreement.

(b) As provided in the Plan, upon the occurrence of a merger, consolidation or similar corporate reorganization (a “Reorganization Event”) that is not a Change of Control, the repurchase and other rights of the Company hereunder shall inure to the benefit of the Company’s successor and shall apply to the cash, securities or other property which the Shares were converted into or exchanged for pursuant to such Reorganization Event that is not a Change of Control in the same manner and to the same extent as they applied to the Shares under this Agreement.

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8. Withholding Taxes; Section 83(b) Election .

(a) The Participant acknowledges and agrees that the Company has the right to deduct from payments of any kind otherwise due to the Participant any federal, state or local taxes of any kind required by law to be withheld with respect to the purchase of the Shares by the Participant or the lapse of the Purchase Option.

(b) The Participant has reviewed with the Participant’s own tax advisors the federal, state and local tax consequences of this investment and the transactions contemplated by this Agreement. The Participant is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. The Participant understands that the Participant (and not the Company) shall be responsible for the Participant’s own tax liability that may arise as a result of this investment or the transactions contemplated by this Agreement. The Participant understands that it may be beneficial in many circumstances to elect to be taxed at the time the Shares are purchased rather than when and as the Company’s Purchase Option expires by filing an election under Section 83(b) of the Code with the I.R.S. within 30 days from the date of purchase.

THE PARTICIPANT ACKNOWLEDGES THAT IT IS THE PARTICIPANT’S SOLE RESPONSIBILITY AND NOT THE COMPANY’S TO FILE TIMELY THE ELECTION UNDER SECTION 83(b), EVEN IF THE PARTICIPANT REQUESTS THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON THE PARTICIPANT’S BEHALF.

9. Miscellaneous .

(a) No Rights to Employment . The Participant acknowledges and agrees that the vesting of the Shares pursuant to Section 2 hereof is earned by continuing service as an employee of the Company, either at will or pursuant to the Employment Agreement, and not through the act of being hired or purchasing shares hereunder. The Participant further acknowledges and agrees that the transactions contemplated hereunder and the vesting schedule set forth herein do not constitute an express or implied promise of continued engagement as an employee or consultant for the vesting period, for any period, or at all.

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(b) Severability . The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent permitted by law.

(c) Waiver . Any provision for the benefit of the Company contained in this Agreement may be waived, either generally or in any particular instance, by the Board of Directors of the Company.

(d) Binding Effect . This Agreement shall be binding upon and inure to the benefit of the Company and the Participant and their respective heirs, executors, administrators, legal representatives, successors and assigns, subject to the restrictions on transfer set forth in Section 4 of this Agreement.

(e) Notice . All notices required or permitted hereunder shall be in writing and deemed effectively given upon personal delivery or five days after deposit in the United States Post Office, by registered or certified mail, postage prepaid, addressed to the other party hereto at the address shown beneath his or its respective signature to this Agreement, or at such other address or addresses as either party shall designate to the other in accordance with this Section 9(e).

(f) Pronouns . Whenever the context may require, any pronouns used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural, and vice versa.

(g) Entire Agreement . This Agreement and the Plan constitute the entire agreement between the parties, and supersedes all prior agreements and understandings, relating to the subject matter of this Agreement.

(h) Amendment . This Agreement may be amended or modified only by a written instrument executed by both the Company and the Participant.

(i) Governing Law . This Agreement shall be construed, interpreted and enforced in accordance with the internal laws of the State of Delaware without regard to any applicable conflicts of laws.

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(j) Participant’s Acknowledgments . The Participant acknowledges that he or she: (i) has read this Agreement; (ii) has been represented in the preparation, negotiation, and execution of this Agreement by legal counsel of the Participant’s own choice or has voluntarily declined to seek such counsel; (iii) understands the terms and consequences of this Agreement; (iv) is fully aware of the legal and binding effect of this Agreement; and (v) understands that any lawyers or law firms utilized by the Company in drafting this agreement are acting as counsel to the Company in connection with the transactions contemplated by the Agreement, and are not acting as counsel for the Participant.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

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Exhibit A

LINCARE HOLDINGS INC.

Joint Escrow Instructions

October 1, 2009

Director – Employee Relations

Lincare Holdings Inc.

19387 U.S. 19 North

Clearwater Florida 33764

Dear Sir:

As Escrow Agent for Lincare Holdings Inc., a Delaware corporation, and its successors in interest under the Restricted Stock Agreement (the “Agreement”) of even date herewith, to which a copy of these Joint Escrow Instructions is attached (the “Company”), and the undersigned person (“Holder”), you are hereby authorized and directed to hold the documents delivered to you pursuant to the terms of the Agreement in accordance with the following instructions:

1. Appointment . Holder irrevocably authorizes the Company to deposit with you any certificates evidencing Shares (as defined in the Agreement) to be held by you hereunder and any additions and substitutions to said Shares. For purposes of these Joint Escrow Instructions, “Shares” shall be deemed to include any additional or substitute property. Holder does hereby irrevocably constitute and appoint you as his attorney-in-fact and agent for the term of this escrow to execute with respect to such Shares all documents necessary or appropriate to make such Shares negotiable and to complete any transaction herein contemplated. Subject to the provisions of this paragraph 1 and the terms of the Agreement, Holder shall exercise all rights and privileges of a stockholder of the Company while the Shares are held by you.

2. Closing of Purchase .

(a) Upon any purchase by the Company of the Shares pursuant to the Agreement, the Company shall give to Holder and you a written notice specifying the purchase price for the Shares, as determined pursuant to the Agreement, and the time for a closing hereunder (the “Closing”) at the principal office of the Company. Holder and the Company hereby irrevocably authorize and direct you to close the transaction contemplated by such notice in accordance with the terms of said notice.

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(b) At the Closing, you are directed (i) to date the stock assignment form or forms necessary for the transfer of the Shares, (ii) to fill in on such form or forms the number of Shares being transferred, and (iii) to deliver same, together with the certificate or certificates evidencing the Shares to be transferred, to the Company against the simultaneous delivery to you of the purchase price for the Shares being purchased pursuant to the Agreement.

3. Withdrawal . The Holder shall have the right to withdraw from this escrow any Shares as to which the Purchase Option (as defined in the Agreement) has terminated or expired.

4. Duties of Escrow Agent .

(a) Your duties hereunder may be altered, amended, modified or revoked only by a writing signed by all of the parties hereto.

(b) You shall be obligated only for the performance of such duties as are specifically set forth herein and may rely and shall be protected in relying or refraining from acting on any instrument reasonably believed by you to be genuine and to have been signed or presented by the proper party or parties. You shall not be personally liable for any act you may do or omit to do hereunder as Escrow Agent or as attorney-in-fact of Holder while acting in good faith and in the exercise of your own good judgment, and any act done or omitted by you pursuant to the advice of your own attorneys shall be conclusive evidence of such good faith.

(c) You are hereby expressly authorized to disregard any and all warnings given by any of the parties hereto or by any other person or Company, excepting only orders or process of courts of law, and are hereby expressly authorized to comply with and obey orders, judgments or decrees of any court. In case you obey or comply with any such order, judgment or decree of any court, you shall not be liable to any of the parties hereto or to any other person, firm or Company by reason of such compliance, notwithstanding any such order, judgment or decree being subsequently reversed, modified, annulled, set aside, vacated or found to have been entered without jurisdiction.

(d) You shall not be liable in any respect on account of the identity, authority or rights of the parties executing or delivering or purporting to execute or deliver the Agreement or any documents or papers deposited or called for hereunder.

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(e) You shall be entitled to employ such legal counsel and other experts as you may deem necessary properly to advise you in connection with your obligations hereunder and may rely upon the advice of such counsel.

(f) Your rights and responsibilities as Escrow Agent hereunder shall terminate if (i) you cease to be Director – Employee Relations of the Company or (ii) you resign by written notice to each party. In the event of a termination under clause (i), your successor as Director – Employee Relations shall become Escrow Agent hereunder; in the event of a termination under clause (ii), the Company shall appoint a successor Escrow Agent hereunder.

(g) If you reasonably require other or further instruments in connection with these Joint Escrow Instructions or obligations in respect hereto, the necessary parties hereto shall join in furnishing such instruments.

(h) It is understood and agreed that should any dispute arise with respect to the delivery and/or ownership or right of possession of the securities held by you hereunder, you are authorized and directed to retain in your possession without liability to anyone all or any part of said securities until such dispute shall have been settled either by mutual written agreement of the parties concerned or by a final order, decree or judgment of a court of competent jurisdiction after the time for appeal has expired and no appeal has been perfected, but you shall be under no duty whatsoever to institute or defend any such proceedings.

(i) These Joint Escrow Instructions set forth your sole duties with respect to any and all matters pertinent hereto and no implied duties or obligations shall be read into these Joint Escrow Instructions against you.

(j) The Company shall indemnify you and hold you harmless against any and all damages, losses, liabilities, costs, and expenses, including attorneys’ fees and disbursements, for anything done or omitted to be done by you as Escrow Agent in connection with this Agreement or the performance of your duties hereunder, except such as shall result from your gross negligence or willful misconduct.

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5. Notice . Any notice required or permitted hereunder shall be given in writing and shall be deemed effectively given upon personal delivery or upon deposit in the United States Post Office, by registered or certified mail with postage and fees prepaid, addressed to each of the other parties thereunto entitled at the following addresses, or at such other addresses as a party may designate by ten days’ advance written notice to each of the other parties hereto.

6. Miscellaneous .

(a) By signing these Joint Escrow Instructions, you become a party hereto only for the purpose of said Joint Escrow Instructions, and you do not become a party to the Agreement.

(b) This instrument shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

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Exhibit B

(STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE)

FOR VALUE RECEIVED, I hereby sell, assign and transfer unto              (      ) shares of Common Stock, $0.01 par value per share, of Lincare Holdings Inc. (the “Corporation”) standing in my name on the books of the Corporation represented by Certificate(s) Number          herewith, and do hereby irrevocably constitute and appoint                                  attorney to transfer the said stock on the books of the Corporation with full power of substitution in the premises.

Dated as of the      day of          , 20     

NOTICE: The signature(s) to this assignment must correspond with the name as written upon the face of the certificate, in every particular, without alteration, enlargement, or any change whatever and must be guaranteed by a commercial bank, trust company or member firm of the Boston, New York or Midwest Stock Exchange.

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Exhibit 10.5

LINCARE HOLDINGS INC.

RESTRICTED STOCK AGREEMENT

THIS AGREEMENT made this 1st day of October, 2009, between Lincare Holdings Inc., a Delaware corporation (the “Company”), and Shawn S. Schabel (the “Participant”).

For valuable consideration, receipt of which is acknowledged, the parties hereto agree as follows:

1. Purchase of Shares .

The Company shall issue and sell to the Participant, and the Participant shall purchase from the Company, subject to the terms and conditions set forth in this Agreement and in the Company’s 2007 Stock Plan (the “Plan”), 290,000 shares (the “Shares”) of Common Stock, $.01 par value, of the Company (“Common Stock”), at a purchase price of $0.01 per share. The aggregate purchase price for the Shares shall be paid by the Participant by check payable to the order of the Company or such other method as may be acceptable to the Company. Upon receipt by the Company of payment for the Shares, the Company shall issue to the Participant one or more certificates in the name of the Participant for that number of Shares purchased by the Participant. The Participant agrees that the Shares shall be subject to the purchase option set forth in Section 2 of this Agreement and the restrictions on transfer set forth in Section 4 of this Agreement.

2. Purchase Option .

(a) In the event that the Participant ceases to be employed by the Company for any reason or no reason, with or without cause, prior to November 1, 2012, the Company shall have the right and option (the “Purchase Option”) to purchase from the Participant, for a sum of $0.01 per share (the “Option Price”), some or all of the Unvested Shares (as defined below).

“Unvested Shares” means the total number of Shares multiplied by the Applicable Percentage at the time the Purchase Option becomes exercisable by the Company. The “Applicable Percentage” shall be (i) 100% during the period commencing on the date hereof and ending on October 31, 2012 and (ii) zero, on or after November 1, 2012; provided , however, that the

Applicable Percentage shall be zero if the Participant’s employment with the Company is terminated pursuant to Section 7(a)(i), (ii), (iv), (vi) or (vii) of the Third Amended Employment Agreement, dated as of October 1, 2009 (the “Employment Agreement”), between the Company and the Participant. The Compensation Committee of the Board of Directors, in its sole discretion, may at any time accelerate the time set forth herein for the vesting of the Shares.

(b) For purposes of this Agreement, employment with the Company shall include employment with a parent or subsidiary of the Company.

3. Exercise of Purchase Option and Closing .

(a) The Company may exercise the Purchase Option by delivering or mailing to the Participant, within 90 days after the termination of the employment of the Participant with the Company, a written notice of exercise of the Purchase Option. Such notice shall specify the number of Shares to be purchased. If and to the extent the Purchase Option is not so exercised by the giving of such a notice within such 90-day period, the Purchase Option shall automatically expire and terminate effective upon the expiration of such 90-day period.

(b) Within 10 days after delivery to the Participant of the Company’s notice of the exercise of the Purchase Option pursuant to subsection (a) above, the Participant shall, pursuant to the provisions of the Joint Escrow Instructions referred to in Section 5 below, tender to the Company at its principal offices the certificate or certificates representing the Shares that the Company has elected to purchase in accordance with the terms of this Agreement, duly endorsed in blank or with duly endorsed stock powers attached thereto, all in form suitable for the transfer of such Shares to the Company. Promptly following its receipt of such certificate or certificates, the Company shall pay to the Participant the aggregate Option Price for such Shares (provided that any delay in making such payment shall not invalidate the Company’s exercise of the Purchase Option with respect to such Shares).

(c) After the time at which any Shares are required to be delivered to the Company for transfer to the Company pursuant to subsection (b) above, the Company shall not pay any dividend to the Participant on account of such Shares or permit the Participant to exercise any of the privileges or rights of a stockholder with respect to such Shares, but shall, in so far as permitted by law, treat the Company as the owner of such Shares.

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(d) The Option Price may be payable, at the option of the Company, in cash, by check or both.

(e) The Company shall not purchase any fraction of a Share upon exercise of the Purchase Option, and any fraction of a Share resulting from a computation made pursuant to Section 2 of this Agreement shall be rounded to the nearest whole Share (with any one-half Share being rounded upward).

(f) The Company may assign its Purchase Option to one or more persons or entities.

4. Restrictions on Transfer .

The Participant shall not sell, assign, transfer, pledge, hypothecate or otherwise dispose of, by operation of law or otherwise (collectively “transfer”) any Shares, or any interest therein, that are subject to the Purchase Option, except that the Participant may transfer such Shares (i) to or for the benefit of any spouse, children, parents, uncles, aunts, siblings, grandchildren and any other relatives approved by the Board of Directors (collectively, “Approved Relatives”) or to a trust established solely for the benefit of the Participant and/or Approved Relatives, provided that such Shares shall remain subject to this Agreement (including without limitation the restrictions on transfer set forth in this Section 4, the Purchase Option and the right of first refusal set forth in Section 5) and such permitted transferee shall, as a condition to such transfer, deliver to the Company a written instrument confirming that such transferee shall be bound by all of the terms and conditions of this Agreement or (ii) as part of the sale of all or substantially all of the shares of capital stock of the Company (including pursuant to a merger or consolidation), provided that, in accordance with the Plan, the securities or other property received by the Participant in connection with such transaction shall remain subject to this Agreement unless such transaction is a Change of Control (as defined in the Employment Agreement).

5. Escrow .

The Participant shall, upon the execution of this Agreement, execute Joint Escrow Instructions in the form attached to this Agreement as Exhibit A . The Joint Escrow Instructions shall be delivered to the Director – Employee Relations of the Company, as escrow agent thereunder. The

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Participant shall deliver to such escrow agent a stock assignment duly endorsed in blank, in the form attached to this Agreement as Exhibit B , and hereby instructs the Company to deliver to such escrow agent, on behalf of the Participant, the certificate(s) evidencing the Shares issued hereunder. Such materials shall be held by such escrow agent pursuant to the terms of such Joint Escrow Instructions.

6. Restrictive Legend .

All certificates representing Shares shall have affixed thereto a legend in substantially the following form, in addition to any other legends that may be required under federal or state securities laws:

“The shares of stock represented by this certificate are subject to restrictions on transfer and an option to purchase set forth in a certain Restricted Stock Agreement between the corporation and the registered owner of these shares (or his predecessor in interest), and such Agreement is available for inspection without charge at the office of the Secretary of the corporation.”

7. Provisions of the Plan .

(a) This Agreement is subject to the provisions of the Plan, a copy of which is furnished to the Participant with this Agreement.

(b) As provided in the Plan, upon the occurrence of a merger, consolidation or similar corporate reorganization (a “Reorganization Event”) that is not a Change of Control, the repurchase and other rights of the Company hereunder shall inure to the benefit of the Company’s successor and shall apply to the cash, securities or other property which the Shares were converted into or exchanged for pursuant to such Reorganization Event that is not a Change of Control in the same manner and to the same extent as they applied to the Shares under this Agreement.

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8. Withholding Taxes; Section 83(b) Election .

(a) The Participant acknowledges and agrees that the Company has the right to deduct from payments of any kind otherwise due to the Participant any federal, state or local taxes of any kind required by law to be withheld with respect to the purchase of the Shares by the Participant or the lapse of the Purchase Option.

(b) The Participant has reviewed with the Participant’s own tax advisors the federal, state and local tax consequences of this investment and the transactions contemplated by this Agreement. The Participant is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. The Participant understands that the Participant (and not the Company) shall be responsible for the Participant’s own tax liability that may arise as a result of this investment or the transactions contemplated by this Agreement. The Participant understands that it may be beneficial in many circumstances to elect to be taxed at the time the Shares are purchased rather than when and as the Company’s Purchase Option expires by filing an election under Section 83(b) of the Code with the I.R.S. within 30 days from the date of purchase.

THE PARTICIPANT ACKNOWLEDGES THAT IT IS THE PARTICIPANT’S SOLE RESPONSIBILITY AND NOT THE COMPANY’S TO FILE TIMELY THE ELECTION UNDER SECTION 83(b), EVEN IF THE PARTICIPANT REQUESTS THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON THE PARTICIPANT’S BEHALF.

9. Miscellaneous .

(a) No Rights to Employment . The Participant acknowledges and agrees that the vesting of the Shares pursuant to Section 2 hereof is earned by continuing service as an employee of the Company, either at will or pursuant to the Employment Agreement, and not through the act of being hired or purchasing shares hereunder. The Participant further acknowledges and agrees that the transactions contemplated hereunder and the vesting schedule set forth herein do not constitute an express or implied promise of continued engagement as an employee or consultant for the vesting period, for any period, or at all.

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(b) Severability . The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent permitted by law.

(c) Waiver . Any provision for the benefit of the Company contained in this Agreement may be waived, either generally or in any particular instance, by the Board of Directors of the Company.

(d) Binding Effect . This Agreement shall be binding upon and inure to the benefit of the Company and the Participant and their respective heirs, executors, administrators, legal representatives, successors and assigns, subject to the restrictions on transfer set forth in Section 4 of this Agreement.

(e) Notice . All notices required or permitted hereunder shall be in writing and deemed effectively given upon personal delivery or five days after deposit in the United States Post Office, by registered or certified mail, postage prepaid, addressed to the other party hereto at the address shown beneath his or its respective signature to this Agreement, or at such other address or addresses as either party shall designate to the other in accordance with this Section 9(e).

(f) Pronouns . Whenever the context may require, any pronouns used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural, and vice versa.

(g) Entire Agreement . This Agreement and the Plan constitute the entire agreement between the parties, and supersedes all prior agreements and understandings, relating to the subject matter of this Agreement.

(h) Amendment . This Agreement may be amended or modified only by a written instrument executed by both the Company and the Participant.

(i) Governing Law . This Agreement shall be construed, interpreted and enforced in accordance with the internal laws of the State of Delaware without regard to any applicable conflicts of laws.

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(j) Participant’s Acknowledgments . The Participant acknowledges that he or she: (i) has read this Agreement; (ii) has been represented in the preparation, negotiation, and execution of this Agreement by legal counsel of the Participant’s own choice or has voluntarily declined to seek such counsel; (iii) understands the terms and consequences of this Agreement; (iv) is fully aware of the legal and binding effect of this Agreement; and (v) understands that any lawyers or law firms utilized by the Company in drafting this agreement are acting as counsel to the Company in connection with the transactions contemplated by the Agreement, and are not acting as counsel for the Participant.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

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Exhibit A

LINCARE HOLDINGS INC.

Joint Escrow Instructions

October 1, 2009

Director – Employee Relations

Lincare Holdings Inc.

19387 U.S. 19 North

Clearwater Florida 33764

Dear Sir:

As Escrow Agent for Lincare Holdings Inc., a Delaware corporation, and its successors in interest under the Restricted Stock Agreement (the “Agreement”) of even date herewith, to which a copy of these Joint Escrow Instructions is attached (the “Company”), and the undersigned person (“Holder”), you are hereby authorized and directed to hold the documents delivered to you pursuant to the terms of the Agreement in accordance with the following instructions:

1. Appointment . Holder irrevocably authorizes the Company to deposit with you any certificates evidencing Shares (as defined in the Agreement) to be held by you hereunder and any additions and substitutions to said Shares. For purposes of these Joint Escrow Instructions, “Shares” shall be deemed to include any additional or substitute property. Holder does hereby irrevocably constitute and appoint you as his attorney-in-fact and agent for the term of this escrow to execute with respect to such Shares all documents necessary or appropriate to make such Shares negotiable and to complete any transaction herein contemplated. Subject to the provisions of this paragraph 1 and the terms of the Agreement, Holder shall exercise all rights and privileges of a stockholder of the Company while the Shares are held by you.

2. Closing of Purchase .

(a) Upon any purchase by the Company of the Shares pursuant to the Agreement, the Company shall give to Holder and you a written notice specifying the purchase price for the Shares, as determined pursuant to the Agreement, and the time for a closing hereunder (the “Closing”) at the principal office of the Company. Holder and the Company hereby irrevocably authorize and direct you to close the transaction contemplated by such notice in accordance with the terms of said notice.

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(b) At the Closing, you are directed (i) to date the stock assignment form or forms necessary for the transfer of the Shares, (ii) to fill in on such form or forms the number of Shares being transferred, and (iii) to deliver same, together with the certificate or certificates evidencing the Shares to be transferred, to the Company against the simultaneous delivery to you of the purchase price for the Shares being purchased pursuant to the Agreement.

3. Withdrawal . The Holder shall have the right to withdraw from this escrow any Shares as to which the Purchase Option (as defined in the Agreement) has terminated or expired.

4. Duties of Escrow Agent .

(a) Your duties hereunder may be altered, amended, modified or revoked only by a writing signed by all of the parties hereto.

(b) You shall be obligated only for the performance of such duties as are specifically set forth herein and may rely and shall be protected in relying or refraining from acting on any instrument reasonably believed by you to be genuine and to have been signed or presented by the proper party or parties. You shall not be personally liable for any act you may do or omit to do hereunder as Escrow Agent or as attorney-in-fact of Holder while acting in good faith and in the exercise of your own good judgment, and any act done or omitted by you pursuant to the advice of your own attorneys shall be conclusive evidence of such good faith.

(c) You are hereby expressly authorized to disregard any and all warnings given by any of the parties hereto or by any other person or Company, excepting only orders or process of courts of law, and are hereby expressly authorized to comply with and obey orders, judgments or decrees of any court. In case you obey or comply with any such order, judgment or decree of any court, you shall not be liable to any of the parties hereto or to any other person, firm or Company by reason of such compliance, notwithstanding any such order, judgment or decree being subsequently reversed, modified, annulled, set aside, vacated or found to have been entered without jurisdiction.

(d) You shall not be liable in any respect on account of the identity, authority or rights of the parties executing or delivering or purporting to execute or deliver the Agreement or any documents or papers deposited or called for hereunder.

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(e) You shall be entitled to employ such legal counsel and other experts as you may deem necessary properly to advise you in connection with your obligations hereunder and may rely upon the advice of such counsel.

(f) Your rights and responsibilities as Escrow Agent hereunder shall terminate if (i) you cease to be Director – Employee Relations of the Company or (ii) you resign by written notice to each party. In the event of a termination under clause (i), your successor as Director – Employee Relations shall become Escrow Agent hereunder; in the event of a termination under clause (ii), the Company shall appoint a successor Escrow Agent hereunder.

(g) If you reasonably require other or further instruments in connection with these Joint Escrow Instructions or obligations in respect hereto, the necessary parties hereto shall join in furnishing such instruments.

(h) It is understood and agreed that should any dispute arise with respect to the delivery and/or ownership or right of possession of the securities held by you hereunder, you are authorized and directed to retain in your possession without liability to anyone all or any part of said securities until such dispute shall have been settled either by mutual written agreement of the parties concerned or by a final order, decree or judgment of a court of competent jurisdiction after the time for appeal has expired and no appeal has been perfected, but you shall be under no duty whatsoever to institute or defend any such proceedings.

(i) These Joint Escrow Instructions set forth your sole duties with respect to any and all matters pertinent hereto and no implied duties or obligations shall be read into these Joint Escrow Instructions against you.

(j) The Company shall indemnify you and hold you harmless against any and all damages, losses, liabilities, costs, and expenses, including attorneys’ fees and disbursements, for anything done or omitted to be done by you as Escrow Agent in connection with this Agreement or the performance of your duties hereunder, except such as shall result from your gross negligence or willful misconduct.

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5. Notice . Any notice required or permitted hereunder shall be given in writing and shall be deemed effectively given upon personal delivery or upon deposit in the United States Post Office, by registered or certified mail with postage and fees prepaid, addressed to each of the other parties thereunto entitled at the following addresses, or at such other addresses as a party may designate by ten days’ advance written notice to each of the other parties hereto.

6. Miscellaneous .

(a) By signing these Joint Escrow Instructions, you become a party hereto only for the purpose of said Joint Escrow Instructions, and you do not become a party to the Agreement.

(b) This instrument shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

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Exhibit B

(STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE)

FOR VALUE RECEIVED, I hereby sell, assign and transfer unto              (      ) shares of Common Stock, $0.01 par value per share, of Lincare Holdings Inc. (the “Corporation”) standing in my name on the books of the Corporation represented by Certificate(s) Number          herewith, and do hereby irrevocably constitute and appoint                                  attorney to transfer the said stock on the books of the Corporation with full power of substitution in the premises.

Dated as of the      day of              , 20     

NOTICE: The signature(s) to this assignment must correspond with the name as written upon the face of the certificate, in every particular, without alteration, enlargement, or any change whatever and must be guaranteed by a commercial bank, trust company or member firm of the Boston, New York or Midwest Stock Exchange.

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Exhibit 10.6

LINCARE HOLDINGS INC.

RESTRICTED STOCK AGREEMENT

THIS AGREEMENT made this 1st day of October, 2009, between Lincare Holdings Inc., a Delaware corporation (the “Company”), and Paul G. Gabos (the “Participant”).

For valuable consideration, receipt of which is acknowledged, the parties hereto agree as follows:

1. Purchase of Shares .

The Company shall issue and sell to the Participant, and the Participant shall purchase from the Company, subject to the terms and conditions set forth in this Agreement and in the Company’s 2007 Stock Plan (the “Plan”), 220,000 shares (the “Shares”) of Common Stock, $.01 par value, of the Company (“Common Stock”), at a purchase price of $0.01 per share. The aggregate purchase price for the Shares shall be paid by the Participant by check payable to the order of the Company or such other method as may be acceptable to the Company. Upon receipt by the Company of payment for the Shares, the Company shall issue to the Participant one or more certificates in the name of the Participant for that number of Shares purchased by the Participant. The Participant agrees that the Shares shall be subject to the purchase option set forth in Section 2 of this Agreement and the restrictions on transfer set forth in Section 4 of this Agreement.

2. Purchase Option .

(a) In the event that the Participant ceases to be employed by the Company for any reason or no reason, with or without cause, prior to November 1, 2012, the Company shall have the right and option (the “Purchase Option”) to purchase from the Participant, for a sum of $0.01 per share (the “Option Price”), some or all of the Unvested Shares (as defined below).

“Unvested Shares” means the total number of Shares multiplied by the Applicable Percentage at the time the Purchase Option becomes exercisable by the Company. The “Applicable Percentage” shall be (i) 100% during the period commencing on the date hereof and ending on October 31, 2012 and (ii) zero, on or after November 1, 2012; provided , however, that the

Applicable Percentage shall be zero if the Participant’s employment with the Company is terminated pursuant to Section 7(a)(i), (ii), (iv), (vi) or (vii) of the Third Amended Employment Agreement, dated as of October 1, 2009 (the “Employment Agreement”), between the Company and the Participant. The Compensation Committee of the Board of Directors, in its sole discretion, may at any time accelerate the time set forth herein for the vesting of the Shares.

(b) For purposes of this Agreement, employment with the Company shall include employment with a parent or subsidiary of the Company.

3. Exercise of Purchase Option and Closing .

(a) The Company may exercise the Purchase Option by delivering or mailing to the Participant, within 90 days after the termination of the employment of the Participant with the Company, a written notice of exercise of the Purchase Option. Such notice shall specify the number of Shares to be purchased. If and to the extent the Purchase Option is not so exercised by the giving of such a notice within such 90-day period, the Purchase Option shall automatically expire and terminate effective upon the expiration of such 90-day period.

(b) Within 10 days after delivery to the Participant of the Company’s notice of the exercise of the Purchase Option pursuant to subsection (a) above, the Participant shall, pursuant to the provisions of the Joint Escrow Instructions referred to in Section 5 below, tender to the Company at its principal offices the certificate or certificates representing the Shares that the Company has elected to purchase in accordance with the terms of this Agreement, duly endorsed in blank or with duly endorsed stock powers attached thereto, all in form suitable for the transfer of such Shares to the Company. Promptly following its receipt of such certificate or certificates, the Company shall pay to the Participant the aggregate Option Price for such Shares (provided that any delay in making such payment shall not invalidate the Company’s exercise of the Purchase Option with respect to such Shares).

(c) After the time at which any Shares are required to be delivered to the Company for transfer to the Company pursuant to subsection (b) above, the Company shall not pay any dividend to the Participant on account of such Shares or permit the Participant to exercise any of the privileges or rights of a stockholder with respect to such Shares, but shall, in so far as permitted by law, treat the Company as the owner of such Shares.

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(d) The Option Price may be payable, at the option of the Company, in cash, by check or both.

(e) The Company shall not purchase any fraction of a Share upon exercise of the Purchase Option, and any fraction of a Share resulting from a computation made pursuant to Section 2 of this Agreement shall be rounded to the nearest whole Share (with any one-half Share being rounded upward).

(f) The Company may assign its Purchase Option to one or more persons or entities.

4. Restrictions on Transfer .

The Participant shall not sell, assign, transfer, pledge, hypothecate or otherwise dispose of, by operation of law or otherwise (collectively “transfer”) any Shares, or any interest therein, that are subject to the Purchase Option, except that the Participant may transfer such Shares (i) to or for the benefit of any spouse, children, parents, uncles, aunts, siblings, grandchildren and any other relatives approved by the Board of Directors (collectively, “Approved Relatives”) or to a trust established solely for the benefit of the Participant and/or Approved Relatives, provided that such Shares shall remain subject to this Agreement (including without limitation the restrictions on transfer set forth in this Section 4, the Purchase Option and the right of first refusal set forth in Section 5) and such permitted transferee shall, as a condition to such transfer, deliver to the Company a written instrument confirming that such transferee shall be bound by all of the terms and conditions of this Agreement or (ii) as part of the sale of all or substantially all of the shares of capital stock of the Company (including pursuant to a merger or consolidation), provided that, in accordance with the Plan, the securities or other property received by the Participant in connection with such transaction shall remain subject to this Agreement unless such transaction is a Change of Control (as defined in the Employment Agreement).

5. Escrow .

The Participant shall, upon the execution of this Agreement, execute Joint Escrow Instructions in the form attached to this Agreement as Exhibit A . The Joint Escrow Instructions shall be delivered to the Director – Employee Relations of the Company, as escrow agent thereunder. The

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Participant shall deliver to such escrow agent a stock assignment duly endorsed in blank, in the form attached to this Agreement as Exhibit B , and hereby instructs the Company to deliver to such escrow agent, on behalf of the Participant, the certificate(s) evidencing the Shares issued hereunder. Such materials shall be held by such escrow agent pursuant to the terms of such Joint Escrow Instructions.

6. Restrictive Legend .

All certificates representing Shares shall have affixed thereto a legend in substantially the following form, in addition to any other legends that may be required under federal or state securities laws:

“The shares of stock represented by this certificate are subject to restrictions on transfer and an option to purchase set forth in a certain Restricted Stock Agreement between the corporation and the registered owner of these shares (or his predecessor in interest), and such Agreement is available for inspection without charge at the office of the Secretary of the corporation.”

7. Provisions of the Plan .

(a) This Agreement is subject to the provisions of the Plan, a copy of which is furnished to the Participant with this Agreement.

(b) As provided in the Plan, upon the occurrence of a merger, consolidation or similar corporate reorganization (a “Reorganization Event”) that is not a Change of Control, the repurchase and other rights of the Company hereunder shall inure to the benefit of the Company’s successor and shall apply to the cash, securities or other property which the Shares were converted into or exchanged for pursuant to such Reorganization Event that is not a Change of Control in the same manner and to the same extent as they applied to the Shares under this Agreement.

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8. Withholding Taxes; Section 83(b) Election .

(a) The Participant acknowledges and agrees that the Company has the right to deduct from payments of any kind otherwise due to the Participant any federal, state or local taxes of any kind required by law to be withheld with respect to the purchase of the Shares by the Participant or the lapse of the Purchase Option.

(b) The Participant has reviewed with the Participant’s own tax advisors the federal, state and local tax consequences of this investment and the transactions contemplated by this Agreement. The Participant is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. The Participant understands that the Participant (and not the Company) shall be responsible for the Participant’s own tax liability that may arise as a result of this investment or the transactions contemplated by this Agreement. The Participant understands that it may be beneficial in many circumstances to elect to be taxed at the time the Shares are purchased rather than when and as the Company’s Purchase Option expires by filing an election under Section 83(b) of the Code with the I.R.S. within 30 days from the date of purchase.

THE PARTICIPANT ACKNOWLEDGES THAT IT IS THE PARTICIPANT’S SOLE RESPONSIBILITY AND NOT THE COMPANY’S TO FILE TIMELY THE ELECTION UNDER SECTION 83(b), EVEN IF THE PARTICIPANT REQUESTS THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON THE PARTICIPANT’S BEHALF.

9. Miscellaneous .

(a) No Rights to Employment . The Participant acknowledges and agrees that the vesting of the Shares pursuant to Section 2 hereof is earned by continuing service as an employee of the Company, either at will or pursuant to the Employment Agreement, and not through the act of being hired or purchasing shares hereunder. The Participant further acknowledges and agrees that the transactions contemplated hereunder and the vesting schedule set forth herein do not constitute an express or implied promise of continued engagement as an employee or consultant for the vesting period, for any period, or at all.

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(b) Severability . The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent permitted by law.

(c) Waiver . Any provision for the benefit of the Company contained in this Agreement may be waived, either generally or in any particular instance, by the Board of Directors of the Company.

(d) Binding Effect . This Agreement shall be binding upon and inure to the benefit of the Company and the Participant and their respective heirs, executors, administrators, legal representatives, successors and assigns, subject to the restrictions on transfer set forth in Section 4 of this Agreement.

(e) Notice . All notices required or permitted hereunder shall be in writing and deemed effectively given upon personal delivery or five days after deposit in the United States Post Office, by registered or certified mail, postage prepaid, addressed to the other party hereto at the address shown beneath his or its respective signature to this Agreement, or at such other address or addresses as either party shall designate to the other in accordance with this Section 9(e).

(f) Pronouns . Whenever the context may require, any pronouns used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural, and vice versa.

(g) Entire Agreement . This Agreement and the Plan constitute the entire agreement between the parties, and supersedes all prior agreements and understandings, relating to the subject matter of this Agreement.

(h) Amendment . This Agreement may be amended or modified only by a written instrument executed by both the Company and the Participant.

(i) Governing Law . This Agreement shall be construed, interpreted and enforced in accordance with the internal laws of the State of Delaware without regard to any applicable conflicts of laws.

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(j) Participant’s Acknowledgments . The Participant acknowledges that he or she: (i) has read this Agreement; (ii) has been represented in the preparation, negotiation, and execution of this Agreement by legal counsel of the Participant’s own choice or has voluntarily declined to seek such counsel; (iii) understands the terms and consequences of this Agreement; (iv) is fully aware of the legal and binding effect of this Agreement; and (v) understands that any lawyers or law firms utilized by the Company in drafting this agreement are acting as counsel to the Company in connection with the transactions contemplated by the Agreement, and are not acting as counsel for the Participant.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

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Exhibit A

LINCARE HOLDINGS INC.

Joint Escrow Instructions

October 1, 2009

Director – Employee Relations

Lincare Holdings Inc.

19387 U.S. 19 North

Clearwater Florida 33764

Dear Sir:

As Escrow Agent for Lincare Holdings Inc., a Delaware corporation, and its successors in interest under the Restricted Stock Agreement (the “Agreement”) of even date herewith, to which a copy of these Joint Escrow Instructions is attached (the “Company”), and the undersigned person (“Holder”), you are hereby authorized and directed to hold the documents delivered to you pursuant to the terms of the Agreement in accordance with the following instructions:

1. Appointment . Holder irrevocably authorizes the Company to deposit with you any certificates evidencing Shares (as defined in the Agreement) to be held by you hereunder and any additions and substitutions to said Shares. For purposes of these Joint Escrow Instructions, “Shares” shall be deemed to include any additional or substitute property. Holder does hereby irrevocably constitute and appoint you as his attorney-in-fact and agent for the term of this escrow to execute with respect to such Shares all documents necessary or appropriate to make such Shares negotiable and to complete any transaction herein contemplated. Subject to the provisions of this paragraph 1 and the terms of the Agreement, Holder shall exercise all rights and privileges of a stockholder of the Company while the Shares are held by you.

2. Closing of Purchase .

(a) Upon any purchase by the Company of the Shares pursuant to the Agreement, the Company shall give to Holder and you a written notice specifying the purchase price for the Shares, as determined pursuant to the Agreement, and the time for a closing hereunder (the “Closing”) at the principal office of the Company. Holder and the Company hereby irrevocably authorize and direct you to close the transaction contemplated by such notice in accordance with the terms of said notice.

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(b) At the Closing, you are directed (i) to date the stock assignment form or forms necessary for the transfer of the Shares, (ii) to fill in on such form or forms the number of Shares being transferred, and (iii) to deliver same, together with the certificate or certificates evidencing the Shares to be transferred, to the Company against the simultaneous delivery to you of the purchase price for the Shares being purchased pursuant to the Agreement.

3. Withdrawal . The Holder shall have the right to withdraw from this escrow any Shares as to which the Purchase Option (as defined in the Agreement) has terminated or expired.

4. Duties of Escrow Agent .

(a) Your duties hereunder may be altered, amended, modified or revoked only by a writing signed by all of the parties hereto.

(b) You shall be obligated only for the performance of such duties as are specifically set forth herein and may rely and shall be protected in relying or refraining from acting on any instrument reasonably believed by you to be genuine and to have been signed or presented by the proper party or parties. You shall not be personally liable for any act you may do or omit to do hereunder as Escrow Agent or as attorney-in-fact of Holder while acting in good faith and in the exercise of your own good judgment, and any act done or omitted by you pursuant to the advice of your own attorneys shall be conclusive evidence of such good faith.

(c) You are hereby expressly authorized to disregard any and all warnings given by any of the parties hereto or by any other person or Company, excepting only orders or process of courts of law, and are hereby expressly authorized to comply with and obey orders, judgments or decrees of any court. In case you obey or comply with any such order, judgment or decree of any court, you shall not be liable to any of the parties hereto or to any other person, firm or Company by reason of such compliance, notwithstanding any such order, judgment or decree being subsequently reversed, modified, annulled, set aside, vacated or found to have been entered without jurisdiction.

(d) You shall not be liable in any respect on account of the identity, authority or rights of the parties executing or delivering or purporting to execute or deliver the Agreement or any documents or papers deposited or called for hereunder.

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(e) You shall be entitled to employ such legal counsel and other experts as you may deem necessary properly to advise you in connection with your obligations hereunder and may rely upon the advice of such counsel.

(f) Your rights and responsibilities as Escrow Agent hereunder shall terminate if (i) you cease to be Director – Employee Relations of the Company or (ii) you resign by written notice to each party. In the event of a termination under clause (i), your successor as Director – Employee Relations shall become Escrow Agent hereunder; in the event of a termination under clause (ii), the Company shall appoint a successor Escrow Agent hereunder.

(g) If you reasonably require other or further instruments in connection with these Joint Escrow Instructions or obligations in respect hereto, the necessary parties hereto shall join in furnishing such instruments.

(h) It is understood and agreed that should any dispute arise with respect to the delivery and/or ownership or right of possession of the securities held by you hereunder, you are authorized and directed to retain in your possession without liability to anyone all or any part of said securities until such dispute shall have been settled either by mutual written agreement of the parties concerned or by a final order, decree or judgment of a court of competent jurisdiction after the time for appeal has expired and no appeal has been perfected, but you shall be under no duty whatsoever to institute or defend any such proceedings.

(i) These Joint Escrow Instructions set forth your sole duties with respect to any and all matters pertinent hereto and no implied duties or obligations shall be read into these Joint Escrow Instructions against you.

(j) The Company shall indemnify you and hold you harmless against any and all damages, losses, liabilities, costs, and expenses, including attorneys’ fees and disbursements, for anything done or omitted to be done by you as Escrow Agent in connection with this Agreement or the performance of your duties hereunder, except such as shall result from your gross negligence or willful misconduct.

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5. Notice . Any notice required or permitted hereunder shall be given in writing and shall be deemed effectively given upon personal delivery or upon deposit in the United States Post Office, by registered or certified mail with postage and fees prepaid, addressed to each of the other parties thereunto entitled at the following addresses, or at such other addresses as a party may designate by ten days’ advance written notice to each of the other parties hereto.

6. Miscellaneous .

(a) By signing these Joint Escrow Instructions, you become a party hereto only for the purpose of said Joint Escrow Instructions, and you do not become a party to the Agreement.

(b) This instrument shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

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Exhibit B

(STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE)

FOR VALUE RECEIVED, I hereby sell, assign and transfer unto              (      ) shares of Common Stock, $0.01 par value per share, of Lincare Holdings Inc. (the “Corporation”) standing in my name on the books of the Corporation represented by Certificate(s) Number          herewith, and do hereby irrevocably constitute and appoint                                  attorney to transfer the said stock on the books of the Corporation with full power of substitution in the premises.

Dated as of the      day of              , 20     

NOTICE: The signature(s) to this assignment must correspond with the name as written upon the face of the certificate, in every particular, without alteration, enlargement, or any change whatever and must be guaranteed by a commercial bank, trust company or member firm of the Boston, New York or Midwest Stock Exchange.

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Exhibit 10.7

LINCARE HOLDINGS INC.

NON-QUALIFIED STOCK OPTION AGREEMENT

October 1, 2009

Pursuant to the Lincare Holdings Inc. 2007 Stock Plan (the “Plan”), the Compensation Committee (the “Committee”) of the Board of Directors of Lincare Holdings Inc. (the “Company”) has granted to you on this date an option (the “Option”) to purchase the number of shares of the Company’s Common Stock, $.01 par value (“Common Stock”), set forth above. Such shares (as the same may be adjusted as described in Section 11 below) are herein referred to as the “Option Shares”. The Option shall constitute and be treated at all times by you and the Company as a “non-qualified stock option” for Federal income tax purposes and shall not constitute and shall not be treated as an “incentive stock option” as defined under Section 422(b) of the Internal Revenue Code of 1986, as amended (the “Code”). The terms and conditions of the Option are set forth below.

1. Date of Grant . The Option is granted to you on October 1, 2009.

2. Termination of Option . Your right to exercise the Option (and to purchase the Option Shares) shall expire and terminate in all events on the earlier of (a) December 1, 2017 or (b) the date provided in Section 9 below in the event you cease to be employed by the Company or any subsidiary or parent thereof (other than as a result of your death or disability as described in Section 9(c) hereof, in which case you shall be deemed for purposes hereof to continue to be employed on a full-time basis).

3. Option Price . The purchase price to be paid upon the exercise of the Option is $30.57 per share, the price at which the Company’s shares of Common Stock were traded on the NASDAQ National Market System at the close of business on the date hereof (subject to adjustment as provided in Section 11 hereof).

4. Vesting Provisions . Except as otherwise provided in Section 5 below, you will not be entitled to exercise the Option (and purchase any Option Shares) prior to November 1, 2010. Commencing on November 1, 2010, you shall become entitled to exercise the Option (rounded to the nearest whole share) in accordance with the following schedule, until the Option expires and terminates pursuant to Section 2 hereof:

(a) Commencing on November 1, 2010, you shall be entitled to exercise 1/3 of the Option Shares;

(b) Commencing on November 1, 2011, you shall be entitled to exercise an additional 1/3 of the Option Shares; and

(b) Commencing on November 1, 2012 you shall be entitled to exercise an additional 1/3 of the Option Shares.

5. Change of Control .

(a) All Options granted hereunder shall vest and shall become immediately exercisable upon a “Change of Control” of the Company. As used herein, the term “Change of Control” shall have the same meaning as “Change of Control” as used and defined in the Third Amended Employment Agreement, dated as of October 1, 2009, (the “Employment Agreement”) between you and Lincare Holdings Inc.

(b) If a Change of Control event as specified in Section 5(a) occurs, then on the business day immediately preceding the occurrence of such event, you shall become entitled to exercise the Option with respect to all Option Shares that you had theretofore not otherwise become entitled to purchase hereunder (with the effect that you shall be deemed eligible to include such Option Shares in any transaction contemplated by Section 5(a) hereof to the extent that you (i) purchase such Option Shares and (ii) are otherwise entitled to participate in such transaction).

(c) Notwithstanding anything contained herein to the contrary, no new rights to exercise the Option with respect to any Option Shares shall be acquired under this Section 5 after the date on which you cease to be employed on a full-time basis by the Company or any subsidiary or parent thereof (unless you have ceased to be employed on a full-time basis by reason of death or disability, as described in Section 9(c) below, in which case you shall be deemed for purposes hereof to continue to be employed on a full-time basis).

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6. Additional Provisions Relating to Exercise .

(a) Once you become entitled to exercise the Option (and purchase Option Shares) as provided in Sections 4 and 5 hereof, such right will continue until the date on which the Option expires and terminates pursuant to Section 2 hereof.

(b) The Committee, in its sole discretion, may at any time accelerate the time set forth in Sections 4 or 5 at which the Option may be exercised by you with respect to any Option Shares.

7. Exercise of Option . To exercise the Option, you must deliver a completed copy of the Stock Option Exercise Form attached hereto to the principal office of the Company, specifying the number of Option Shares being purchased as a result of such exercise. The purchase price for the Option Shares for which an Option is exercised shall be paid in full, in cash, on the date of exercise.

8. Restriction on Transferability . The Option may only be transferred in accordance with the terms of the Plan.

9. Termination of Employment .

(a) In the event that (i) the Company or any subsidiary or parent thereof terminates your employment by such entity “for cause” or (ii) you terminate your employment by such entity for any reason whatsoever (other than as a result of Good Reason, your death or disability as defined in the Employment Agreement), then the Option may only be exercised within one (1) month after such termination, and only to the same extent that you were entitled to exercise the Option on the date your employment was so terminated and had not previously done so. For the purposes of Sections 9(a) and 9(b) hereof, the terms “for cause” and “Good Reason” shall have the meanings set forth in the Employment Agreement.

(b) In the event that you cease to be employed on a full-time basis by the Company or any subsidiary or parent thereof as a result of (i) the termination of your employment by the Company or any subsidiary or parent thereof at any time other than “for cause” or (ii) your termination of your employment with such entity for Good Reason, the Option may only be exercised within one year after the date you cease to be so employed, and only to the same extent that you were entitled to exercise the Option on the date you ceased to be so employed by reason of such termination and had not previously done so.

(c) In the event that you (i) die while employed by the Company or any subsidiary or parent thereof (or within a period of one month after ceasing to be employed by the Company

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or any subsidiary or parent thereof for any reason described in Section 9(b) above) or (ii) cease to be employed on a full-time basis by the Company or any subsidiary or parent thereof by reason of a disability as defined in the Employment Agreement, the Option may be exercised as if you continued to be employed on a full-time basis by the Company or any subsidiary or parent thereof in accordance with the terms of this Agreement without giving effect to any applicability of Section 9(b) hereof. In the event of clause (i) of this subsection, the Option may be exercised by the executor or administrator of your estate or by any person who shall have acquired the Option through bequest or inheritance.

(d) Notwithstanding any provision contained in this Section 9 to the contrary, in no event may the Option be exercised to any extent by anyone after December 1, 2017.

10. Representations . You represent and warrant that you understand the Federal, state and local income tax consequences of the granting of the Option to you, the acquisition of rights to exercise the Option with respect to any Option Shares, the exercise of the Option and purchase of Option Shares, and the subsequent sale or other disposition of any Option Shares. In addition, you understand that the Company will be required to withhold Federal, state or local taxes in respect of any compensation income realized by you upon exercise of the Option granted hereunder. To the extent that the Company is required to withhold any such taxes, you hereby agree that the Company may deduct from any payments of any kind otherwise due to you an amount equal to the total Federal, state and local taxes required to be so withheld, or if such payments are inadequate to satisfy such Federal, state and local taxes, or if no such payments are due or to become due to you, then you agree to provide the Company with cash funds or make other arrangements satisfactory to the Company regarding such payment. It is understood that all matters with respect to the total amount of taxes to be withheld in respect of any such compensation income shall be determined by the Company in its sole discretion; provided , however , that the Company shall consult with you regarding such determination and shall promptly advise you of any such determination made by the Company hereunder with the intention that such advice shall be given in time to permit you to express your views regarding such determination.

11. Adjustments; Reorganization, Reclassification, Consolidation, Merger or Sale .

(a) In the event that, after the date hereof, the outstanding shares of the Company’s Common Stock shall be increased or decreased or changed into or exchanged for a

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different number or kind of shares of stock or other securities of the Company through stock split, split-up, combination or exchange of shares or declaration of any dividends payable in Common Stock, the Committee shall appropriately adjust the number of shares of Common Stock (and the option price per share) subject to the unexercised portion of the Option (to the nearest possible full share), and such adjustment shall be effective and binding for all purposes of this Agreement and the Plan.

(b) If any capital reorganization or reclassification of the capital stock of the Company or any consolidation or merger of the Company with another corporation, or the sale of all or substantially all its assets to another corporation, shall be effected in such a way that holders of Common Stock shall be entitled to receive stock, securities or assets with respect to or in exchange for Common Stock, then, subject to Section 11(c) below, each holder of an Option shall thereafter have the right to receive upon the basis and upon the terms and conditions specified therein and in lieu of the shares of Common Stock of the Company immediately theretofore receivable upon the exercise of such Option, such shares of stock, securities or assets (including cash) as may be issued or payable with respect to or in exchange for a number of outstanding shares of such Common Stock equal to the number of shares of such stock immediately theretofore so receivable had such reorganization, reclassification, consolidation, merger or sale not taken place.

(c) Notwithstanding the foregoing, in the event of any offer to holders of the Company’s Common Stock generally relating to the acquisition of their shares, including, without limitation, through purchase, merger or otherwise, or any transaction generally relating to the acquisition of substantially all of the assets or business of the Company (herein sometimes referred to as an “Acquisition”), the Committee may, in its sole discretion, cancel the Option and pay or deliver to you, or cause to be paid or delivered to you, an amount in cash or securities having a value (as determined by the Board of Directors acting in good faith) equal to the product of (i) the number of Option Shares that, as of the date of the consummation of such Acquisition, you had become entitled to purchase (and had not purchased), multiplied by (ii) the amount, if any, by which (x) the formula or fixed price per share paid to holders of shares of Common Stock pursuant to such Acquisition exceeds (y) the option price set forth in Section 3 hereof.

12. Certain Notices . In case at any time there shall be: (i) a Change of Control as described in Section 5(a) above; or (ii) any capital reorganization or reclassification or any

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consolidation or merger or sale of all or substantially all of the assets of the Company as described in Sections 11(b) or 11(c) above, then the Company shall give, by first class mail, postage prepaid, addressed to you at your address as shown on the books of the Company, at least 20 days’ prior written notice of the date when such transaction or event shall take place, which notice shall contain a reasonably detailed summary of the terms of such transaction or event. The Company shall promptly provide upon request (to the extent permitted under any applicable agreements with third parties) additional relevant information relating to such transaction or event reasonably requested by you.

13. Continuation of Employment . Neither the Plan nor the Option shall confer upon you any right to continue in the employ of the Company or any subsidiary or parent thereof, or limit in any respect the right of the Company or any subsidiary or parent thereof to terminate your employment or other relationship with the Company or any subsidiary or parent thereof, as the case may be, at any time.

14. Plan Documents . This Agreement is qualified in its entirety by reference to the provisions of the Plan, which are hereby incorporated herein by reference.

15. Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware. If any one or more provisions of this Agreement shall be found to be illegal or unenforceable in any respect, the validity and enforceability of the remaining provisions hereof shall not in any way be affected or impaired thereby.

Please acknowledge receipt of this Agreement by signing the enclosed copy of this Agreement in the space provided below and returning it promptly to the Secretary of the Company.

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EXHIBIT A

LINCARE HOLDINGS INC.

STOCK OPTION EXERCISE FORM

I hereby elect to exercise my non-qualified stock option rights as follows:

Please register and deliver my shares as follows:

NAME: ___________________________________________________________________________________________________

ADDRESS: ________________________________________________________________________________________________

__________________________________________________________________________________________________________

SOCIAL SECURITY NUMBER: _______________________________________________________________________________

                             I am currently an Executive Officer or Director of Lincare Holdings Inc.

GENERAL

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Exhibit 10.8

LINCARE HOLDINGS INC.

NON-QUALIFIED STOCK OPTION AGREEMENT

October 1, 2009

Pursuant to the Lincare Holdings Inc. 2007 Stock Plan (the “Plan”), the Compensation Committee (the “Committee”) of the Board of Directors of Lincare Holdings Inc. (the “Company”) has granted to you on this date an option (the “Option”) to purchase the number of shares of the Company’s Common Stock, $.01 par value (“Common Stock”), set forth above. Such shares (as the same may be adjusted as described in Section 11 below) are herein referred to as the “Option Shares”. The Option shall constitute and be treated at all times by you and the Company as a “non-qualified stock option” for Federal income tax purposes and shall not constitute and shall not be treated as an “incentive stock option” as defined under Section 422(b) of the Internal Revenue Code of 1986, as amended (the “Code”). The terms and conditions of the Option are set forth below.

1. Date of Grant . The Option is granted to you on October 1, 2009.

2. Termination of Option . Your right to exercise the Option (and to purchase the Option Shares) shall expire and terminate in all events on the earlier of (a) December 1, 2017 or (b) the date provided in Section 9 below in the event you cease to be employed by the Company or any subsidiary or parent thereof (other than as a result of your death or disability as described in Section 9(c) hereof, in which case you shall be deemed for purposes hereof to continue to be employed on a full-time basis).

3. Option Price . The purchase price to be paid upon the exercise of the Option is $30.57 per share, the price at which the Company’s shares of Common Stock were traded on the NASDAQ National Market System at the close of business on the date hereof (subject to adjustment as provided in Section 11 hereof).

4. Vesting Provisions . Except as otherwise provided in Section 5 below, you will not be entitled to exercise the Option (and purchase any Option Shares) prior to November 1, 2010. Commencing on November 1, 2010, you shall become entitled to exercise the Option (rounded to the nearest whole share) in accordance with the following schedule, until the Option expires and terminates pursuant to Section 2 hereof:

(a) Commencing on November 1, 2010, you shall be entitled to exercise 1/3 of the Option Shares;

(b) Commencing on November 1, 2011, you shall be entitled to exercise an additional 1/3 of the Option Shares; and

(b) Commencing on November 1, 2012 you shall be entitled to exercise an additional 1/3 of the Option Shares.

5. Change of Control .

(a) All Options granted hereunder shall vest and shall become immediately exercisable upon a “Change of Control” of the Company. As used herein, the term “Change of Control” shall have the same meaning as “Change of Control” as used and defined in the Third Amended Employment Agreement, dated as of October 1, 2009, (the “Employment Agreement”) between you and Lincare Holdings Inc.

(b) If a Change of Control event as specified in Section 5(a) occurs, then on the business day immediately preceding the occurrence of such event, you shall become entitled to exercise the Option with respect to all Option Shares that you had theretofore not otherwise become entitled to purchase hereunder (with the effect that you shall be deemed eligible to include such Option Shares in any transaction contemplated by Section 5(a) hereof to the extent that you (i) purchase such Option Shares and (ii) are otherwise entitled to participate in such transaction).

(c) Notwithstanding anything contained herein to the contrary, no new rights to exercise the Option with respect to any Option Shares shall be acquired under this Section 5 after the date on which you cease to be employed on a full-time basis by the Company or any subsidiary or parent thereof (unless you have ceased to be employed on a full-time basis by reason of death or disability, as described in Section 9(c) below, in which case you shall be deemed for purposes hereof to continue to be employed on a full-time basis).

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6. Additional Provisions Relating to Exercise .

(a) Once you become entitled to exercise the Option (and purchase Option Shares) as provided in Sections 4 and 5 hereof, such right will continue until the date on which the Option expires and terminates pursuant to Section 2 hereof.

(b) The Committee, in its sole discretion, may at any time accelerate the time set forth in Sections 4 or 5 at which the Option may be exercised by you with respect to any Option Shares.

7. Exercise of Option . To exercise the Option, you must deliver a completed copy of the Stock Option Exercise Form attached hereto to the principal office of the Company, specifying the number of Option Shares being purchased as a result of such exercise. The purchase price for the Option Shares for which an Option is exercised shall be paid in full, in cash, on the date of exercise.

8. Restriction on Transferability . The Option may only be transferred in accordance with the terms of the Plan.

9. Termination of Employment .

(a) In the event that (i) the Company or any subsidiary or parent thereof terminates your employment by such entity “for cause” or (ii) you terminate your employment by such entity for any reason whatsoever (other than as a result of Good Reason, your death or disability as defined in the Employment Agreement), then the Option may only be exercised within one (1) month after such termination, and only to the same extent that you were entitled to exercise the Option on the date your employment was so terminated and had not previously done so. For the purposes of Sections 9(a) and 9(b) hereof, the terms “for cause” and “Good Reason” shall have the meanings set forth in the Employment Agreement.

(b) In the event that you cease to be employed on a full-time basis by the Company or any subsidiary or parent thereof as a result of (i) the termination of your employment by the Company or any subsidiary or parent thereof at any time other than “for cause” or (ii) your termination of your employment with such entity for Good Reason, the Option may only be exercised within one year after the date you cease to be so employed, and only to the same extent that you were entitled to exercise the Option on the date you ceased to be so employed by reason of such termination and had not previously done so.

(c) In the event that you (i) die while employed by the Company or any subsidiary or parent thereof (or within a period of one month after ceasing to be employed by the Company

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or any subsidiary or parent thereof for any reason described in Section 9(b) above) or (ii) cease to be employed on a full-time basis by the Company or any subsidiary or parent thereof by reason of a disability as defined in the Employment Agreement, the Option may be exercised as if you continued to be employed on a full-time basis by the Company or any subsidiary or parent thereof in accordance with the terms of this Agreement without giving effect to any applicability of Section 9(b) hereof. In the event of clause (i) of this subsection, the Option may be exercised by the executor or administrator of your estate or by any person who shall have acquired the Option through bequest or inheritance.

(d) Notwithstanding any provision contained in this Section 9 to the contrary, in no event may the Option be exercised to any extent by anyone after December 1, 2017.

10. Representations . You represent and warrant that you understand the Federal, state and local income tax consequences of the granting of the Option to you, the acquisition of rights to exercise the Option with respect to any Option Shares, the exercise of the Option and purchase of Option Shares, and the subsequent sale or other disposition of any Option Shares. In addition, you understand that the Company will be required to withhold Federal, state or local taxes in respect of any compensation income realized by you upon exercise of the Option granted hereunder. To the extent that the Company is required to withhold any such taxes, you hereby agree that the Company may deduct from any payments of any kind otherwise due to you an amount equal to the total Federal, state and local taxes required to be so withheld, or if such payments are inadequate to satisfy such Federal, state and local taxes, or if no such payments are due or to become due to you, then you agree to provide the Company with cash funds or make other arrangements satisfactory to the Company regarding such payment. It is understood that all matters with respect to the total amount of taxes to be withheld in respect of any such compensation income shall be determined by the Company in its sole discretion; provided , however , that the Company shall consult with you regarding such determination and shall promptly advise you of any such determination made by the Company hereunder with the intention that such advice shall be given in time to permit you to express your views regarding such determination.

11. A djustments; Reorganization, Reclassification, Consolidation, Merger or Sale .

(a) In the event that, after the date hereof, the outstanding shares of the Company’s Common Stock shall be increased or decreased or changed into or exchanged for a

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different number or kind of shares of stock or other securities of the Company through stock split, split-up, combination or exchange of shares or declaration of any dividends payable in Common Stock, the Committee shall appropriately adjust the number of shares of Common Stock (and the option price per share) subject to the unexercised portion of the Option (to the nearest possible full share), and such adjustment shall be effective and binding for all purposes of this Agreement and the Plan.

(b) If any capital reorganization or reclassification of the capital stock of the Company or any consolidation or merger of the Company with another corporation, or the sale of all or substantially all its assets to another corporation, shall be effected in such a way that holders of Common Stock shall be entitled to receive stock, securities or assets with respect to or in exchange for Common Stock, then, subject to Section 11(c) below, each holder of an Option shall thereafter have the right to receive upon the basis and upon the terms and conditions specified therein and in lieu of the shares of Common Stock of the Company immediately theretofore receivable upon the exercise of such Option, such shares of stock, securities or assets (including cash) as may be issued or payable with respect to or in exchange for a number of outstanding shares of such Common Stock equal to the number of shares of such stock immediately theretofore so receivable had such reorganization, reclassification, consolidation, merger or sale not taken place.

(c) Notwithstanding the foregoing, in the event of any offer to holders of the Company’s Common Stock generally relating to the acquisition of their shares, including, without limitation, through purchase, merger or otherwise, or any transaction generally relating to the acquisition of substantially all of the assets or business of the Company (herein sometimes referred to as an “Acquisition”), the Committee may, in its sole discretion, cancel the Option and pay or deliver to you, or cause to be paid or delivered to you, an amount in cash or securities having a value (as determined by the Board of Directors acting in good faith) equal to the product of (i) the number of Option Shares that, as of the date of the consummation of such Acquisition, you had become entitled to purchase (and had not purchased), multiplied by (ii) the amount, if any, by which (x) the formula or fixed price per share paid to holders of shares of Common Stock pursuant to such Acquisition exceeds (y) the option price set forth in Section 3 hereof.

12. Certain Notices . In case at any time there shall be: (i) a Change of Control as described in Section 5(a) above; or (ii) any capital reorganization or reclassification or any

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consolidation or merger or sale of all or substantially all of the assets of the Company as described in Sections 11(b) or 11(c) above, then the Company shall give, by first class mail, postage prepaid, addressed to you at your address as shown on the books of the Company, at least 20 days’ prior written notice of the date when such transaction or event shall take place, which notice shall contain a reasonably detailed summary of the terms of such transaction or event. The Company shall promptly provide upon request (to the extent permitted under any applicable agreements with third parties) additional relevant information relating to such transaction or event reasonably requested by you.

13. Continuation of Employment . Neither the Plan nor the Option shall confer upon you any right to continue in the employ of the Company or any subsidiary or parent thereof, or limit in any respect the right of the Company or any subsidiary or parent thereof to terminate your employment or other relationship with the Company or any subsidiary or parent thereof, as the case may be, at any time.

14. Plan Documents . This Agreement is qualified in its entirety by reference to the provisions of the Plan, which are hereby incorporated herein by reference.

15. Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware. If any one or more provisions of this Agreement shall be found to be illegal or unenforceable in any respect, the validity and enforceability of the remaining provisions hereof shall not in any way be affected or impaired thereby.

Please acknowledge receipt of this Agreement by signing the enclosed copy of this Agreement in the space provided below and returning it promptly to the Secretary of the Company.

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EXHIBIT A

LINCARE HOLDINGS INC.

STOCK OPTION EXERCISE FORM

I hereby elect to exercise my non-qualified stock option rights as follows:

Please register and deliver my shares as follows:

NAME: ___________________________________________________________________________________________________

ADDRESS: ________________________________________________________________________________________________

__________________________________________________________________________________________________________

SOCIAL SECURITY NUMBER: _______________________________________________________________________________

                             I am currently an Executive Officer or Director of Lincare Holdings Inc.

GENERAL

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Exhibit 10.9

LINCARE HOLDINGS INC.

NON-QUALIFIED STOCK OPTION AGREEMENT

October 1, 2009

Pursuant to the Lincare Holdings Inc. 2007 Stock Plan (the “Plan”), the Compensation Committee (the “Committee”) of the Board of Directors of Lincare Holdings Inc. (the “Company”) has granted to you on this date an option (the “Option”) to purchase the number of shares of the Company’s Common Stock, $.01 par value (“Common Stock”), set forth above. Such shares (as the same may be adjusted as described in Section 11 below) are herein referred to as the “Option Shares”. The Option shall constitute and be treated at all times by you and the Company as a “non-qualified stock option” for Federal income tax purposes and shall not constitute and shall not be treated as an “incentive stock option” as defined under Section 422(b) of the Internal Revenue Code of 1986, as amended (the “Code”). The terms and conditions of the Option are set forth below.

1. Date of Grant . The Option is granted to you on October 1, 2009.

2. Termination of Option . Your right to exercise the Option (and to purchase the Option Shares) shall expire and terminate in all events on the earlier of (a) December 1, 2017 or (b) the date provided in Section 9 below in the event you cease to be employed by the Company or any subsidiary or parent thereof (other than as a result of your death or disability as described in Section 9(c) hereof, in which case you shall be deemed for purposes hereof to continue to be employed on a full-time basis).

3. Option Price . The purchase price to be paid upon the exercise of the Option is $30.57 per share, the price at which the Company’s shares of Common Stock were traded on the NASDAQ National Market System at the close of business on the date hereof (subject to adjustment as provided in Section 11 hereof).

4. Vesting Provisions . Except as otherwise provided in Section 5 below, you will not be entitled to exercise the Option (and purchase any Option Shares) prior to November 1, 2010. Commencing on November 1, 2010, you shall become entitled to exercise the Option (rounded to the nearest whole share) in accordance with the following schedule, until the Option expires and terminates pursuant to Section 2 hereof:

(a) Commencing on November 1, 2010, you shall be entitled to exercise 1/3 of the Option Shares;

(b) Commencing on November 1, 2011, you shall be entitled to exercise an additional 1/3 of the Option Shares; and

(b) Commencing on November 1, 2012 you shall be entitled to exercise an additional 1/3 of the Option Shares.

5. Change of Control .

(a) All Options granted hereunder shall vest and shall become immediately exercisable upon a “Change of Control” of the Company. As used herein, the term “Change of Control” shall have the same meaning as “Change of Control” as used and defined in the Third Amended Employment Agreement, dated as of October 1, 2009, (the “Employment Agreement”) between you and Lincare Holdings Inc.

(b) If a Change of Control event as specified in Section 5(a) occurs, then on the business day immediately preceding the occurrence of such event, you shall become entitled to exercise the Option with respect to all Option Shares that you had theretofore not otherwise become entitled to purchase hereunder (with the effect that you shall be deemed eligible to include such Option Shares in any transaction contemplated by Section 5(a) hereof to the extent that you (i) purchase such Option Shares and (ii) are otherwise entitled to participate in such transaction).

(c) Notwithstanding anything contained herein to the contrary, no new rights to exercise the Option with respect to any Option Shares shall be acquired under this Section 5 after the date on which you cease to be employed on a full-time basis by the Company or any subsidiary or parent thereof (unless you have ceased to be employed on a full-time basis by reason of death or disability, as described in Section 9(c) below, in which case you shall be deemed for purposes hereof to continue to be employed on a full-time basis).

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6. Additional Provisions Relating to Exercise .

(a) Once you become entitled to exercise the Option (and purchase Option Shares) as provided in Sections 4 and 5 hereof, such right will continue until the date on which the Option expires and terminates pursuant to Section 2 hereof.

(b) The Committee, in its sole discretion, may at any time accelerate the time set forth in Sections 4 or 5 at which the Option may be exercised by you with respect to any Option Shares.

7. Exercise of Option . To exercise the Option, you must deliver a completed copy of the Stock Option Exercise Form attached hereto to the principal office of the Company, specifying the number of Option Shares being purchased as a result of such exercise. The purchase price for the Option Shares for which an Option is exercised shall be paid in full, in cash, on the date of exercise.

8. Restriction on Transferability . The Option may only be transferred in accordance with the terms of the Plan.

9. Termination of Employment .

(a) In the event that (i) the Company or any subsidiary or parent thereof terminates your employment by such entity “for cause” or (ii) you terminate your employment by such entity for any reason whatsoever (other than as a result of Good Reason, your death or disability as defined in the Employment Agreement), then the Option may only be exercised within one (1) month after such termination, and only to the same extent that you were entitled to exercise the Option on the date your employment was so terminated and had not previously done so. For the purposes of Sections 9(a) and 9(b) hereof, the terms “for cause” and “Good Reason” shall have the meanings set forth in the Employment Agreement.

(b) In the event that you cease to be employed on a full-time basis by the Company or any subsidiary or parent thereof as a result of (i) the termination of your employment by the Company or any subsidiary or parent thereof at any time other than “for cause” or (ii) your termination of your employment with such entity for Good Reason, the Option may only be exercised within one year after the date you cease to be so employed, and only to the same extent that you were entitled to exercise the Option on the date you ceased to be so employed by reason of such termination and had not previously done so.

(c) In the event that you (i) die while employed by the Company or any subsidiary or parent thereof (or within a period of one month after ceasing to be employed by the Company

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or any subsidiary or parent thereof for any reason described in Section 9(b) above) or (ii) cease to be employed on a full-time basis by the Company or any subsidiary or parent thereof by reason of a disability as defined in the Employment Agreement, the Option may be exercised as if you continued to be employed on a full-time basis by the Company or any subsidiary or parent thereof in accordance with the terms of this Agreement without giving effect to any applicability of Section 9(b) hereof. In the event of clause (i) of this subsection, the Option may be exercised by the executor or administrator of your estate or by any person who shall have acquired the Option through bequest or inheritance.

(d) Notwithstanding any provision contained in this Section 9 to the contrary, in no event may the Option be exercised to any extent by anyone after December 1, 2017.

10. Representations . You represent and warrant that you understand the Federal, state and local income tax consequences of the granting of the Option to you, the acquisition of rights to exercise the Option with respect to any Option Shares, the exercise of the Option and purchase of Option Shares, and the subsequent sale or other disposition of any Option Shares. In addition, you understand that the Company will be required to withhold Federal, state or local taxes in respect of any compensation income realized by you upon exercise of the Option granted hereunder. To the extent that the Company is required to withhold any such taxes, you hereby agree that the Company may deduct from any payments of any kind otherwise due to you an amount equal to the total Federal, state and local taxes required to be so withheld, or if such payments are inadequate to satisfy such Federal, state and local taxes, or if no such payments are due or to become due to you, then you agree to provide the Company with cash funds or make other arrangements satisfactory to the Company regarding such payment. It is understood that all matters with respect to the total amount of taxes to be withheld in respect of any such compensation income shall be determined by the Company in its sole discretion; provided , however , that the Company shall consult with you regarding such determination and shall promptly advise you of any such determination made by the Company hereunder with the intention that such advice shall be given in time to permit you to express your views regarding such determination.

11. A djustments; Reorganization, Reclassification, Consolidation, Merger or Sale .

(a) In the event that, after the date hereof, the outstanding shares of the Company’s Common Stock shall be increased or decreased or changed into or exchanged for a

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different number or kind of shares of stock or other securities of the Company through stock split, split-up, combination or exchange of shares or declaration of any dividends payable in Common Stock, the Committee shall appropriately adjust the number of shares of Common Stock (and the option price per share) subject to the unexercised portion of the Option (to the nearest possible full share), and such adjustment shall be effective and binding for all purposes of this Agreement and the Plan.

(b) If any capital reorganization or reclassification of the capital stock of the Company or any consolidation or merger of the Company with another corporation, or the sale of all or substantially all its assets to another corporation, shall be effected in such a way that holders of Common Stock shall be entitled to receive stock, securities or assets with respect to or in exchange for Common Stock, then, subject to Section 11(c) below, each holder of an Option shall thereafter have the right to receive upon the basis and upon the terms and conditions specified therein and in lieu of the shares of Common Stock of the Company immediately theretofore receivable upon the exercise of such Option, such shares of stock, securities or assets (including cash) as may be issued or payable with respect to or in exchange for a number of outstanding shares of such Common Stock equal to the number of shares of such stock immediately theretofore so receivable had such reorganization, reclassification, consolidation, merger or sale not taken place.

(c) Notwithstanding the foregoing, in the event of any offer to holders of the Company’s Common Stock generally relating to the acquisition of their shares, including, without limitation, through purchase, merger or otherwise, or any transaction generally relating to the acquisition of substantially all of the assets or business of the Company (herein sometimes referred to as an “Acquisition”), the Committee may, in its sole discretion, cancel the Option and pay or deliver to you, or cause to be paid or delivered to you, an amount in cash or securities having a value (as determined by the Board of Directors acting in good faith) equal to the product of (i) the number of Option Shares that, as of the date of the consummation of such Acquisition, you had become entitled to purchase (and had not purchased), multiplied by (ii) the amount, if any, by which (x) the formula or fixed price per share paid to holders of shares of Common Stock pursuant to such Acquisition exceeds (y) the option price set forth in Section 3 hereof.

12. Certain Notices . In case at any time there shall be: (i) a Change of Control as described in Section 5(a) above; or (ii) any capital reorganization or reclassification or any

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consolidation or merger or sale of all or substantially all of the assets of the Company as described in Sections 11(b) or 11(c) above, then the Company shall give, by first class mail, postage prepaid, addressed to you at your address as shown on the books of the Company, at least 20 days’ prior written notice of the date when such transaction or event shall take place, which notice shall contain a reasonably detailed summary of the terms of such transaction or event. The Company shall promptly provide upon request (to the extent permitted under any applicable agreements with third parties) additional relevant information relating to such transaction or event reasonably requested by you.

13. Continuation of Employment . Neither the Plan nor the Option shall confer upon you any right to continue in the employ of the Company or any subsidiary or parent thereof, or limit in any respect the right of the Company or any subsidiary or parent thereof to terminate your employment or other relationship with the Company or any subsidiary or parent thereof, as the case may be, at any time.

14. Plan Documents . This Agreement is qualified in its entirety by reference to the provisions of the Plan, which are hereby incorporated herein by reference.

15. Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware. If any one or more provisions of this Agreement shall be found to be illegal or unenforceable in any respect, the validity and enforceability of the remaining provisions hereof shall not in any way be affected or impaired thereby.

Please acknowledge receipt of this Agreement by signing the enclosed copy of this Agreement in the space provided below and returning it promptly to the Secretary of the Company.

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EXHIBIT A

LINCARE HOLDINGS INC.

STOCK OPTION EXERCISE FORM

I hereby elect to exercise my non-qualified stock option rights as follows:

Please register and deliver my shares as follows:

NAME: ___________________________________________________________________________________________________

ADDRESS: ________________________________________________________________________________________________

__________________________________________________________________________________________________________

SOCIAL SECURITY NUMBER: _______________________________________________________________________________

GENERAL

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