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EXHIBIT 10.2
DANNINGER MEDICAL TECHNOLOGY, INC.
1984 INCENTIVE STOCK OPTION PLAN
1. PURPOSE. The purpose of this plan is to advance the interests of
Danninger Medical Technology, Inc. (the "Company") by providing an opportunity
to selected key employees of the Company to purchase stock of the Company
through the exercise of options granted under this Plan. By encouraging such
stock ownership, the Company seeks to attract, retain and motivate key employees
of training, experience and ability. It is intended that this purpose will be
effected by the granting of stock options as provided herein which will qualify
as "incentive stock options" under the provisions of Section 422A of the
Internal Revenue Code of 1954, as amended (the "Code").
2. EFFECTIVE DATE. This Plan shall become effective on January 27, 1984
provided that the Plan is approved by the shareholders of the Company within one
(1) year from that date. Although options may be granted before such approval,
no option may be exercised until such approval is obtained and such options will
be null and void if such approval is not obtained.
3. STOCK SUBJECT TO THE PLAN. The shares that may be granted under this
Plan shall not exceed in the aggregate 150,000 shares of the no par value Common
Stock of the Company. Any shares subject to an option which for any reason
expires or is terminated unexercised as to such shares may again be the subject
of an option under the Plan. The shares delivered upon exercise of options under
this Plan may, in whole or in part, be either authorized but unissued shares or
issued shares reacquired by the Company.
4. ADMINISTRATION. The Plan shall be administered by a committee (the
"Stock Option Committee") consisting of two (2) or more members, who shall be
eligible to participate in the Plan. The Stock Option Committee shall be
appointed by and shall serve at the pleasure of the Board of Directors of the
Company. Subject to the provisions of this Plan, said Committee shall have full
power to construe and interpret the Plan and to establish, amend and rescind
rules and regulations for its administration.
5. ELIGIBLE EMPLOYEES. Options may be granted by the Board of Directors
to such key employees of the Company, including members of the Board of
Directors who are also employees of the Company or any of its subsidiaries, as
are selected by the Stock Option Committee.
6. DURATION OF THE PLAN. The Plan shall terminate ten (10) years from
the effective date unless terminated earlier pursuant to Paragraph 11 hereof,
and no options may be granted thereafter.
7. LIMITATIONS ON NUMBER OF SHARES. The aggregate fair market value,
determined as of the date the option is granted, of the shares for which an
employee may be granted options in any calendar year shall not exceed $100,000
plus any "unused limit carryovers" as that term is defined under Section
422A(c)(4) of the Code, available in such year. In the event that such employee
is eligible to participate in any other stock incentive plans of the Company or
a subsidiary which are also intended to comply with the provisions of Section
422A of the Code, such annual limitation shall apply to the aggregate number of
shares for which options may be granted for such plans.
8. TERMS AND CONDITIONS OF OPTIONS. Options granted under this Plan
shall be evidenced by stock option agreements in such form and not inconsistent
with the Plan as the Stock Option Committee shall approve from time to time,
which agreements shall include, but not be limited to, the following terms and
conditions:
(a) Price. The purchase price per share of stock payable upon
the exercise of each option granted hereunder shall be not less than 100
percent of the fair market value of the stock on the day the option is
granted; provided, however, that if at the time of the grant the
optionee owns stock possessing more than 10 percent of the combined
voting power of all classes of stock of the Company or its parent or a
subsidiary, such purchase price per share shall be not less than 110
percent of the fair market value of the stock on the day the option is
granted. Such fair market value shall be determined in accordance with
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procedures to be established in good faith by the Stock Option Committee
conforming to regulations issued by the Internal Revenue Service with
regard to incentive stock options.
(b) Number of Shares. Each option agreement shall specify the
number of shares to which it pertains.
(c) Exercise of Option. Each option shall be exercisable for the
full amount or for any part thereof and at such intervals or in such
installments as the Board of Directors may determine at the time it
grants such option; provided, however, that no option shall be
exercisable with respect to any shares later than ten (10) years after
the date of the grant of such option; and provided, further, that if at
the time of the grant of such option, the optionee owns stock possessing
more than 10 percent of the combined voting power of all classes of
stock of the Company or a subsidiary, such option shall be exercisable
no later than five (5) years after the date of its grant.
(d) Notice of Exercise and Payment. An option shall be
exercisable only by delivery of a written notice to the Stock option
Committee, any member of the Committee, the Company's Treasurer, or any
other officer of the Company designated by the Committee to accept such
notices on its behalf, specifying the number of shares for which it is
exercised. If said shares are not at the time effectively registered
under the Securities Act of 1933, as amended, the optionee shall include
with such notice a letter, in form and substance satisfactory to the
Company, confirming that the shares are being purchased for the
optionee's own account for investment and not with a view to
distribution. Payment shall be made in full at the time of delivery to
the optionee of a certificate or certificates covering the number of
shares for which the option was exercised. Payment shall be made either
by (i) cashier's or certified check, (ii) if permitted by a vote of the
Board of Directors by delivery and assignment to the Company of shares
of Company stock, or (iii) by a combination of (i) and (ii). The value
of the Company stock for such purpose shall be its fair market value as
of the date the option is exercised, as determined in accordance with
the procedures to be established by the Stock Option Committee.
(e) Non-Transferability. No option shall be transferable by the
optionee otherwise than by will or the laws of descent or distribution,
and each option shall be exercisable during his lifetime only by him.
(f) Termination of 0ptions. Each option shall terminate and may
no-longer be exercised if the optionee ceases for any reason to be an
employee of the Company, or its parent or a subsidiary, except that:
(i) if the optionee's employment shall have terminated for
any reason other than cause, disability (as defined below) or
death, he may at any time within a period of thirty (30) days
after such termination of employment exercise his option to the
extent that the option was exercisable by him on the date of
termination of his employment;
(ii) if the optionee's employment shall have been terminated
because of disability within the meaning of Section 105(d)(4) of
the Code, he may at any time within a period of one (1) year
after such termination of employment exercise his option to the
extent that the option was exercisable by him on the date of
termination of his employment; and
(iii) if the optionee dies at a time when the option was
exercisable by him, then his estate, personal representative or
beneficiary to whom it has been transferred pursuant to
paragraph 8(e) hereof may, within six (6) months following the
death, exercise the option to the extent the option might have
been exercised at the time of his death; provided, however, that
no option may be exercised to any extent by anyone after the
date of expiration of the option.
(g) Rights as Shareholder. The optionee shall have no rights as
a shareholder with respect to any shares covered by his option until the
date of issuance of a stock certificate to him for such shares.
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(h) Effect of other Outstanding Options. No option granted
hereunder shall be exercisable by an optionee while there is
"outstanding" within the meaning of Section 422A(c)(7) of the code, any
incentive stock option which was granted to the optionee before the
granting of the option under this Plan and which permits the optionee to
purchase stock in (i) the Company, (ii) a corporation which (at the time
of the granting of the option under this Plan) is a parent or subsidiary
of the Company, or (iii) a predecessor corporation of any such
corporations.
9. STOCK DIVIDENDS; SPLITS; STOCK COMBINATION; RECAPITALIZATION.
Appropriate adjustment shall be made in the maximum number of shares of Common
Stock subject to the Plan and in the number, kind, and option price of shares
covered by outstanding options granted hereunder to give effect to any stock
dividends or other distribution, stock splits, stock combinations,
recapitalizations and other similar changes in the capital structure of the
Company after the effective date of the Plan.
10. MERGER; SALE OF ASSETS; DISSOLUTION. In the event of a change of the
Common Stock resulting from a merger or similar reorganization as to which the
Company is the surviving corporation, the number and kind of shares which
thereafter may be optioned and sold under the Plan and the number and kind of
shares then subject to options granted hereunder and the price per share thereof
shall be appropriately adjusted in such a manner as the Stock Option Committee
may deem equitable to prevent substantial dilution or enlargement of the rights
available or granted hereunder. If the Company at any time should elect to
dissolve, sell all or substantially all of its assets, undergo a reorganization,
or merge or consolidate with any corporation and the Company is not the
surviving corporation, then (unless in the case of a reorganization, merger, or
consolidation the surviving corporation assumes the optionees' rights under the
Plan or issues substantially equivalent substitute rights in place thereof) each
optionee shall be notified by the Company of his right to exercise all
outstanding options prior to any such dissolution sale, reorganization merger or
consolidation. The failure to exercise such outstanding options within thirty
(30) days of such notification shall cause the options to be terminated.
11. TERMINATION OR AMENDMENT OF PLAN. The Board of Directors may at any
time terminate the Plan or make such changes in or additions to the Plan as it
deems advisable without further action-on the part of the shareholders of the
Company; provided:
(a) that no such termination or amendment shall adversely affect
or impair any then outstanding option without the consent of the
optionee holding such option;
(b) that any such amendment which increases the number of shares
subject to this Plan shall be subject to approval by shareholders of the
Company within one (1) year from the effective date of such amendment
and shall be null and void if such approval is not obtained; and
(c) that in no event shall any amendment be made to the Plan
which would cause the options granted hereunder to fail to qualify as
incentive stock options under the Code.
12. EFFECT OF THE PLAN ON EMPLOYMENT RELATIONSHIP. The establishment of
the Plan shall in no way, now or hereafter, reduce, enlarge or modify the
employment relationship between the Company and the Optionee. Nothing contained
in the Plan shall be construed as conferring upon any Optionee any right to
continue in the employ of the Company.
13. DEFINITIONS.
(a) The term "key employees" means those executive,
administrative, operational or managerial employees of the Company who
are determined by the Stock Option Committee to be eligible for options
under this Plan.
(b) The term "optionee" means a key employee to whom an option
is granted under this Plan.
(c) The term "parent" shall, for purposes of this Plan, have the
meaning ascribed to it under Section 425(e) of the Code.
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(d) The term "subsidiary" shall, for purposes of this Plan, have
the meaning ascribed to it under Section 425(f) of the Code.