Travel & Expense Policy

01/19/2011 Travel & Expense Policy STATEMENT OF PURPOSE This policy establishes guidelines governing the reimbursement of travel and entertainment expenses incurred during the conduct of BioScrip business. BioScrip will reimburse an employee ordinary, necessary and reasonable travel expenses when directly connected with, or pertaining to the transaction of Company business. This policy also covers other expenses that may not be associated with travel. The following policies and guidelines are intended to assure maximum cost control for BioScrip while maintaining a high level of quality and consistency in services and accommodations for our travelers. This document serves as the standard travel policy and guideline. Employees are expected to exercise prudent judgment regarding travel and entertainment expenses covered by these guidelines. Employees submitting expenses that are not in compliance with this policy risk delayed, partial, or forfeited reimbursement. Cases of significant abuse will result in disciplinary action, up to and including termination. As stated in the BioScrip, Inc. Employee Handbook, all employees are required to conduct themselves in a lawful, ethical, respectful and safety-conscious manner. This includes, but is not limited to drug and alcohol abuse, immoral conduct and fraudulent behavior. RESPONSIBILITY AND ENFORCEMENT BioScrip Employees who incur travel and entertainment expenses are responsible for complying with this policy. The expense reports should be submitted for reimbursement once a month by the 20 th of each month. BioScrip will reimburse employees for authorized approved business travel and entertainment The use of our contracted travel agency is of paramount importance. Only with your cooperation will we maintain the integrity and optimal pricing of our programs. The employee s signature certifies that all expenditures listed on the expense report are clearly and correctly described, actual amounts in all instances are shown, and expenses are supported by receipts in accordance with this policy. Travel Approval Preapproved travel is required for Vice President level and below. The Travel Request Form must be approved in advance of travel by your manager. BioScrip will not reimburse for any travel and entertainment expenses that has not been preapproved. This form can be found on the Intranet under Forms. The approved Travel Request From must be attached to the expense report. RECEIPTS / DOCUMENTATION OF EXPENSE Documentation of expenses is required for reimbursement for Company and IRS purposes. It is mandatory that all travelers support all expenses, regardless of the amount, with a

credit card receipt and receipt from the establishment, i.e., hotel folio showing detail, restaurant bill showing what was ordered. The exception to receipts will be for minimal tips and fees where credit cards cannot be used, i.e., toll fees, doorman or bellman tips. - All air travel receipts, invoices/itineraries from Blue Ribbon Travel, and boarding passes must be submitted with the related expense report. TRAVEL ARRANGEMENTS All travel arrangements (airline, lodging, rental car, etc.) must be arranged through BioScrip s contracted travel agency. Cost effectiveness and negotiated discounts, resulting in savings to the Company, can be monitored only if the authorized Company travel agency handles all business travel. Air Travel Each business trip by air travel must be at a distance of more than 150 miles from the employee s principal place of business. The employee s principal place of business is defined as the location that the employee performs the majority of their business activity. Business trips that are less than 150 miles are subject to reimbursement under the personal motor vehicle section of this policy. a. All domestic business air travel will be by coach/tourist/economy class. Upgrades are allowed at the traveler's personal expense. b. When feasible, all airline reservations should be made at least 14 days in advance. Reservations made less than 14 days in advance require a Vice President s approval prior to ticketing. c. When making airline reservations, employees are required to accept flights that utilize Lowest Logical Fare Routing. This includes alternate airlines such as Southwest, Frontier, etc. Employees may be required to take a connecting flight, a direct flight or go to an alternate airport if the savings to the Company or customer is greater than $300.00, and the routing does not increase the one-way total elapsed trip time by more than two hours. Employees are not obligated to accept travel arrangements which involve return trips arriving at the airport after 10:00 p.m. If lost savings to the Company or customer is greater than $300, VP approval is required prior to ticketing. d. Ticketless Travel/e-Tickets - Employees must retain receipts/itineraries provided by the Company s designated travel agency and attach them to the expense report. Airfare cannot be expensed until the trip has been taken. If employee s credit card statement is due before trip has been expensed, a cash advance can be obtained from accounting with appropriate documentation of the expense and VP approval. Such cash advance must then be noted on expense report after the trip has occurred and deducted from the final amount to be reimbursed. e. The Company will reimburse for nonrefundable tickets canceled due to changes in business plans. Nonrefundable tickets can be used toward the purchase of another ticket for a service fee. Tickets are typically valid for exchange for a minimum of one year. The 2

travel agency tracks all unused tickets and will apply them to future tickets when appropriate. f. Personal Frequent Flyer program benefits must in no way influence flight selection. Although frequent flyer miles are earned from Company-paid travel, the Company allows employees to use the miles earned through such programs for their own personal use. Misuse and abuse of earning frequent flyer miles at additional Company expense will not be tolerated. Such misuse and abuse is subject to disciplinary action including, but not limited to, reimbursement by the employee of the difference between the lowest airfare and the actual price of the airline ticket. g. Airline Clubs The Company will not reimburse employees for Airline Clubs. Motor Vehicle Travel a. Parking: Parking at the airport or while visiting customers will be reimbursed to a reasonable level. Employees should use off-site parking. Keep in mind that the cost of a taxi may be less expensive than airport parking for an extended trip. b. Public Transport (Bus/Shuttle/Taxi) The cost of public transportation to and from places of business, hotels, or airports in connection with business activities is reimbursable. Actual cost of transportation used plus tips not exceeding 15% of total bill will be reimbursed. c. Rental Car i) Employees should rent cars only when other means of transportation are unavailable, more costly or impractical. The use of a rental car must be justified as a business need and not as a matter of personal convenience. ii) Decline additional insurance, the Company s coverage applies to all travelers. iii) All rental cars should be mid-size or smaller, unless a larger car is needed due to entertaining a client or traveling with more than three (3) employees. Any charges incurred for renting a larger vehicle are the sole responsibility of the employee. iv) Every reasonable effort must be made to return the rental car to the original rental location (unless approved for a one-way rental). Cars must be returned on time to avoid additional hourly charges (late fees begin to accrue after a one-hour grace period). v) Employees are expected to refuel rental cars prior to returning them to the vendor. vi) Gas purchased for the rented vehicle at a service or gasoline station is a reimbursable expense. vii) Any employee traveling on behalf of the Company (in a leased vehicle, rented vehicle, or in their personal car) involved in a car accident, should immediately contact their manager and the General Counsel s office for information regarding the procedures to follow. viii) All employees are responsible for obeying all federal, state, and local governmental laws, including motor vehicle laws. The Company will not 3

reimburse employees for penalties involving moving, traffic, parking or other motor vehicle violations while performing Company business. d. Personal Vehicle: The Company will reimburse employees for incidental use of their personal vehicle for trips to/from the airport and local meetings at the rate per mile allowed by the IRS (minus standard commute miles) only if the mileage is in excess of employees normal commute to/from the office. The most current mileage reimbursement rate is located on the expense report form. Employees who work at home or regularly use their personal vehicle for business will be reimbursed per the following IRS guidelines: IF You have an office at a local Company facility that you use on a regular basis. You DO NOT have an office at a local Company facility, or you have one but do not use it on a regular basis, or if you have a qualifying home office. Then the following expenses are reimbursable: Expenses of traveling between your Company office and business site. Expenses of traveling between two business sites. Expenses of traveling between your home and a business site minus standard commute miles. Expenses of traveling between two business sites. and the following expenses are NOT reimbursable: Expenses of traveling between your home and your Company office. Expenses of traveling from your home to the first business site visited that day and from the last business site of the day to your home. Business site means any site visited for business purposes, including business meetings, (including lunch and dinner meetings in restaurants), visits to clients, prospective clients, or vendors. There is no reimbursement for employees with a Company car or employees who receive a car allowance. e. Sedan/Limousine Services: This service should only be used when taxi service is not available or the limo service costs less than a taxi. Lodging a. All hotels must be booked through the designated travel agency, NOT directly through the hotel, so we can track our hotel spend and number of nights stayed in order to negotiate better corporate rates. Employees are expected to use mid level hotels or motels, such as a Marriott Courtyard, Hampton Inn, or similar property. Preferred properties are listed on Reardon. Stays at full service hotels will not be reimbursed. b. Employees are responsible for canceling hotel rooms and must do so through the designated travel agency. Employees will be held responsible for requesting and recording the cancellation number and will not be reimbursed for no-show charges. c. Personal frequent hotel guest programs may in no way influence hotel choice. d. Always charge hotel phone calls to a calling card to avoid hotel surcharges. Utilize 800 numbers provided by the Company to access Company voicemail. Employees who have company-paid cell phones will not be reimbursed for calls made from their hotel room. 4

e. Employees who have broadband capability built into their laptops will not be reimbursed for internet service attained from their hotel room. f. See additional list of non-reimbursable hotel expenses on page 6. Meals & Business Entertainment a. Employees will be reimbursed no more than $50 per day for meals while travelling on overnight trips. If a same day trip is taken, no more than $25 per day will be reimbursed for meals, provided your flight arrival time or your arrival at your residence is 8:00 PM or later.. A credit card receipt and other receipt must be attached to the expense report. Alcohol will not be reimbursed. Tips are included in the per diem amounts. b. Personal (out-of-town) meals are defined as meal expenses incurred by employees when dining alone on an overnight trip. c. Business meals are defined as meals taken with other Company employees, potential employees, clients, potential clients, and business partners. When two or more employees are present, the more senior employee should pay for the meal and expense it. d. Entertainment expense including such events as theater, sports or nightclubs, where a business discussion takes place before, during, or immediately after the event, will be reimbursed if the person entertained has a potential or actual business relationship with the Company. Employee entertainment expenses are not reimbursable.. f. For business meal and entertainment expenses, the following documentation is required by the IRS and must be included on the expense report: i) Names of individuals present, their titles and Company name; ii) Name and location of meal or event; iii) Exact amount and date of expense; iv) Specific business topic; v) In the case of entertainment events, the specific time the business discussion took place (before, during or after the event). Telephone Calls a. Employees who have company paid cell phones should always use their cell phone for all business-related calls. If the cell phone does not have service, all business calls will be reimbursed. Gratuities Gratuities for certain services will be reimbursed. Unless the size of the gratuity is mandated by the number of guests or the location, gratuities should not exceed 15% of the total bill, before tax. Anything above this limit will not be reimbursed. 5

Laundry Reasonable costs for laundry and dry cleaning services will be reimbursed only if the business trip is five (5) days or longer. Additional Guidelines a. Spouse/Companion Travel: Travel expenses for a spouse or guest are only reimbursable if the trip is made at the Company s request or if there is a bona fide business purpose for taking the spouse or other individual. All spouse/companion travel must have approval prior to trip commencement by the CFO or Senior Vice President of Human Resources. b. Expenses resulting from unavoidable travel delays, such as inclement weather, are reimbursable within the parameters of this policy. Non-Reimbursable Expenses Personal expenses incurred while traveling are not reimbursable. Examples of these expenses include: a) Annual fees for frequent flyer, frequent guest clubs or car rental clubs b) Traffic and parking violations, towing charges c) Hotel expenses incurred from failing to cancel reservations d) Replacement cost of briefcases and luggage or contents lost/delayed while on Company business (including toiletry articles such as toothpaste, toothbrush, deodorant, etc.) Employees should file claims with the airlines. e) Emergency drop-off fees associated with rental car return. f) Snacks and refreshments such as coffee, soda, candy, mini bar snacks, etc., which are in addition to meal charges for breakfast, lunch and dinner g) Hotel room movies h) Hotel health and fitness center charges i) Magazines and/or books j) Season tickets k) Shoe shines, haircuts, etc. l) Clothing and related accessories m) Late charges assessed to any account (calling card, cellular phone, etc.) unless due to unreasonable delay in processing a submitted expense report. n) Any estimated or unexplained expenses o) Charges incurred as a result of a third part misuse of lost credit cards p) Political or Charitable Contributions q) Holiday gifts unless specifically approved in advance by the CEO, President or CFO r) Employee gifts unless specifically approved in advance by the CEO, President or CFO s) Going Away lunches/dinners or gifts unless specifically approved in advance by the CEO, President or CFO 6

t) Theft of personal items while on business travel u) No gifts of any kind unless preapproved by the Company s General Counsel. Employee Responsibility a. Employee travelers and their manager are jointly accountable for T&E policy compliance. b. Travel Request Form must be completed and turned in with the expense report. b. Provide a current travel profile to the travel agency and update information as it changes (e.g., phone, address, credit card numbers and expiration date, etc.). c. Prepare expense report and keep a copy for account reconciliation when monthly corporate card statement is received. d. Expense reports must be turned in once a month for reimbursement. e. Corporate American Express Card: i) Use is for business purposes only. No personal charges are allowed. All charges are monitored. If any charges are questionable, they will be brought to the attention of the CFO and Senior Vice President of Human Resources. ii) The account must be paid on time. Any account over 30 days will be brought to the attention of the CFO and Senior Vice President of Human Resources. Late and delinquency fees are the responsibility of the cardholder and are not reimbursable. iii) Reconcile charge activity to expense submissions. iv) Must be utilized for all possible business expenses. v) Upon termination the card will be cancelled. The employee is responsible for paying the balance of the card, including any late and/or delinquency fees. Expense Report Submission The following original documentation is required for all expenditures, regardless of amount: Air Transportation Car Rental Lodging Business Meals Personal Meals Telephone Taxi/Local Transportation Other Expenses Documentation Invoice provided by travel agency. If a Saturday night stay is necessary, a copy of itinerary and travel agency invoice showing detail. If changes or cancellations are made that include a service charge or fee, a receipt must be attached. Record of charge or billing receipt. Hotel folio and credit card receipt Record of charge indicating name and business purpose. If meal is before or after the business discussion, the place, date and duration of the discussion is required. Record of charge. Receipt, hotel bill (for access charges only) or telephone bill. Transportation receipts. Receipts and/or supporting documentation for all items. 7

Other Business Expenses The Company will no longer reimburse for attendance at seminars, professional fees, certifications, or tuition associated with continuing education. Employees are encouraged to research the tax deductibility of these types of professional expenses on their personal tax return. 8

CORPORATE CARD PROGRAM Corporate Card The Company has a corporate card program for our frequent travelers. This program minimizes the employee s personal outflow of cash and generates management reports for budgeting purposes. 1) The Company provides a Corporate Card to employees who travel at least monthly or as a supervisor may deem necessary. 2) Employees will be billed directly by American Express for all expenses and they are responsible to pay their bill on time. The Company issues reimbursements promptly to employees so they can pay these charges, assuming the employee has submitted their Expense Reports in a timely manner. 3) The Company issued Corporate Card is to be used for Company business only and should not be used for personal expenses. All charges are frequently monitored. If nonbusiness charges appear, it will be brought to the attention of the CFO and Senior Vice President of Human Resources. 4) When business and personal expenses are incurred at the same time and/or location, the employee should pay for their personal expenses separately. 6) Any misuse of the Corporate Card will result in the immediate suspension or cancellation of the Card and could result in further disciplinary action against the employee, up to and including termination. 7) Upon an employee s termination of employment, the Corporate Card will be immediately terminated; however, the employee is still responsible for any and all amounts due on their account. The employee must surrender their Corporate Card immediately to their supervisor. 9

Expense Report Procedure General Information 1) Prepare monthly or per trip expenses no later than 3 days after the week or end of trip 2) All employees submitting, approving or processing these reports are to do so in a timely manner to avoid any delay in reimbursing the employee. 3) The IRS requires that all expenses be substantiated by receipts or they are disallowed. Only those expenses where receipts are normally unobtainable are exempt from this requirement. Lack of receipts must be explained in detail on the expense report. 4) All reports not properly completed, supported by receipts, or other documentation will be returned to the employee. If the expense report is not completed accurately or documentation is missing, reimbursement will be reduced by the questionable amount and returned to the employee for re-submission. 5) Falsification of expense reports, receipts and/or supporting documentation will not be tolerated, and is subject to disciplinary action up to and including termination. Completing the Expense Report 1) Obtain most recent Expense Report form found on the Intranet (left hand side, Forms, Expense Report), Save and rename form for your file, begin filling out the fields. 2) PURPOSE OF TRIP: Describe where traveled and for what purpose (customer visit, site visit, presentation, etc.), 3) Fill in Employee Name. 4) Choose Employee s DEPARTMENT/LOCATION from drop down list 5) DATE: Dates of travel or date(s) expense incurred (week ending on Friday). 6) MILEAGE: Includes the mileage for use of the employee s personal vehicle while on Company business. Choose appropriate mileage rate from drop down list. 7) AIRLINE TICKETS: Include copy of invoice from travel agency detailing airfare, service fee, change fees. Also include original boarding passes. 8) LODGING: Expenses incurred for hotel room, including applicable taxes. Do not include meals or telephone charges that are included on the hotel bill (these go on separate line items). 9) MEALS: Breakfast, Lunch, Dinner - Includes the actual cost of personal meals and tips incurred while an employee is traveling. $50 per day for overnight stays, $25 per day for day trips. Total amount includes tips. 10) AUTO EXPENSE: Rental, Taxi, Gas, Parking, Tolls - Includes all expenses incurred for rental car, taxi (w/gratuity), parking, etc. Gas for rental vehicles should be included here. It is not necessary to break down the charges of the rental on a per-day basis (unless you have a Saturday night stay). 10

11) PHONE: Long distance, calling cards - All local, long distance, facsimile or access charges while traveling if cell phone coverage is not available. 12) BUSINESS MEALS/ENTERTAINMENT: Business meals and entertainment with other Company employees, potential employees, clients, potential clients, and business partners. A complete description should be noted at the bottom of the T&E form. Include: date, establishment name and location, total cost, names of people and their company name attending, and business purpose. 13) MISCELLANEOUS: All items which do not fit into the other categories. The expenses must be itemized and described in the Miscellaneous Charges section and must include itemized receipt regardless of amount. 14) SIGNATURES: Employee should sign on the employee line and forward the completed report with original receipts to their supervisors for approval. The supervisor will then forward to Accounting for reimbursement. Helpful Hints 1) Make sure all original receipts are attached and the amounts on the receipts match the amounts on the expense report. 2) Only original documents should be submitted. If it is necessary to submit a non original, an explanation should be attached and signed by your supervisor. 3) Tape receipts to an 8½ x 11 sheet of paper and staple to the expense report to ensure that all receipts will be received intact. 11