Exhibit 99
SUMMIT MEDICAL SYSTEMS, INC.
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STOCK OPTION PLAN
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OF 1993
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Article I. Establishment and Purpose
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1.1 Establishment. Summit Medical Systems, Inc., a Minnesota corporation
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("Company"), hereby establishes a stock option plan for Employees and others
providing services to the Company, as described herein, which shall be known as
the "STOCK OPTION PLAN OF 1993" (the "Plan"). It is intended that certain of
the options issued pursuant to the Plan to Employees of the Company may
constitute incentive stock options within the meaning of section 422 of the
Internal Revenue Code, and that other options issued pursuant to the Plan shall
constitute nonstatutory options. The Board shall determine which options are to
be incentive stock options and which are to be nonstatutory options and shall
enter into option agreements with recipients accordingly.
1.2 Purpose. The purpose of this Plan is to enhance stockholder
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investment by attracting, retaining, motivating and rewarding key Employees and
Consultants of the Company, and to encourage stock ownership by such Employees
and Consultants by providing them with a means to acquire a proprietary interest
in the Company's success.
Article II. Definitions
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2.1 Definitions. Whenever used herein, the following terms shall have the
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respective meanings set forth below, unless the context clearly requires
otherwise, and when said meaning is intended, the term shall be capitalized.
(a) "Board" means the Board of Directors of the Company.
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(b) "Code" means the Internal Revenue Code of 1986, as amended.
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(c) "Company" means Summit Medical Systems, Inc., a Minnesota corporation.
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(d) "Consultant" means any person or entity, including an officer or
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director of the Company, who provides services (other than as an
Employee) to the Company.
(e) "Date of Exercise" means the date the Company receives notice, by an
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Optionee, of the exercise of an Option pursuant to section 8.1 of this
Plan. Such notice shall indicate the number of shares of Stock the
Optionee intends to exercise and shall be accompanied by payment
therefor.
(f) "Employee" means any person, including an officer or director of the
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Company, who is employed by the Company in a full or part-time
capacity.
(g) "Fair Market Value" means the fair market value of Stock upon which an
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option is granted under this Plan.
(h) "Incentive Stock Option" means an Option granted under this Plan which
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is intended to qualify as an "incentive stock option" within the
meaning of Section 422 of the Code.
(i) "Nonstatutory Option" means an Option granted under this Plan which is
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not intended to qualify as an incentive stock option within the
meaning of Section 422 of the Code. Nonstatutory Options may be
granted at such times and subject to such restrictions as the Board
shall determine without conforming to the statutory rules of Section
422 of the Code applicable to incentive stock options.
(j) "Option" means the right, granted under this Plan, to purchase Stock
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of the Company at the option price for a specified period of time.
For purposes of this Plan, an Option may be either an Incentive Stock
Option or a Nonstatutory Option.
(k) "Optionee" means an Employee or Consultant holding an Option under the
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Plan.
(l) "Parent Corporation" shall have the meaning set forth in Section
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424(e) of the Code, with the Company being treated as the employer
corporation for purposes of this definition.
(m) "Subsidiary Corporation" shall have the meaning set forth in Section
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424(f) of the Code, with the Company being treated as the employer
corporation for purposes of this definition.
(n) "Significant Shareholder" means an individual who, within the meaning
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of Section 422(b)(6) of the Code, owns stock possessing more than ten
percent (108) of the total combined voting power of all classes of
stock of the Company or of any Parent Corporation or Subsidiary
Corporation of the Company. In determining whether an individual is a
Significant Shareholder, an individual shall be treated as owning
stock owned by certain relatives of the individual and certain stock
owned by corporations in which the individual is a shareholder,
partnerships in which the individual is a partner, and estates or
trusts
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of which the individual is a beneficiary, all as provided in Section
424(d) of the Code.
(o) "Stock" means the $.01 par value common stock of the Company.
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2.2 Gender and Number. Except when otherwise indicated by the context,
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any masculine terminology when used in this Plan also shall include the feminine
gender, and the definition of any term herein in the singular also shall include
the plural.
Article III. Eligibility and Participation
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3.1 Eligibility and Participation. All Employees are eligible to
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participate in this Plan and receive Incentive Stock Options and/or Nonstatutory
Options hereunder. All Consultants are eligible to participate in this Plan and
receive Nonstatutory Options hereunder. Optionees in the Plan shall be selected
by the Board from among those Employees and Consultants who, in the opinion of
the Board, have contributed or are in a position to contribute materially to the
Company's continued growth and development and to its long-term financial
success.
Article IV. Administration
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4.1 Administration.
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The Board shall administer the Plan. The Board is authorized to interpret
the Plan; to prescribe, amend, and rescind rules and regulations relating to the
Plan; to provide for conditions and assurances deemed necessary or advisable to
protect the interests of the Company; and to make all determinations necessary
or advisable for the administration of those portions of the Plan that it
administers, but only to the extent not contrary to the express provisions of
the Plan. Determinations, interpretations, or other actions made or taken by
the Board, pursuant to the provisions of this Plans shall be final, binding, and
conclusive for all purposes and upon all persons.
No member of the Board shall be liable for any action or determination made
in good faith with respect to the Plan or any Option granted under it.
Article V. Stock Subject to the Plan
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5.1 Number. The number of shares of Stock hereby made available and
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reserved for issuance under the Plan is 220,000. The aggregate number of shares
of Stock available under this Plan shall be subject to adjustment as provided in
Section 5.3. The total number of shares of Stock may be authorized but unissued
shares of
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Stock, or shares acquired by purchase as directed by the Board from time to time
in its discretion, to be used for issuance upon exercise of Options granted
hereunder.
5.2 Unused Stock. If an Option shall expire or terminate for any reason
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without having been exercised in full, the unpurchased shares of Stock subject
thereto shall (unless the Plan shall have terminated) become available for other
Options under the Plan.
5.3 Adjustment in Capitalization. In the event of any change in the
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outstanding shares of Stock by reason of a stock dividend or split,
recapitalization, reclassification, or other similar corporate change, the
aggregate number of shares of Stock set forth in Section 5.1 shall be
appropriately adjusted by the Board, whose determination shall be conclusive;
provided, however, that fractional shares shall be rounded to the nearest whole
share. In any such case, the number and kind of shares that are subject to any
Option (including any Option outstanding after termination of employment) and
the Option price per share shall be proportionately and appropriately adjusted
without any change in the aggregate Option price to be paid therefor upon
exercise of the Option.
Article VI. Duration of the Plan
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6.1 Duration of the Plan. The Plan shall be in effect for ten (10) years
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from the date of its adoption by the Company. Any Options outstanding at the
end of said period shall remain in effect in accordance with their terms. The
Plan shall terminate before the end of said period, if all Stock subject to it
has been purchased pursuant to the exercise of Options granted under the Plan.
Article VII. Terms of Stock Options
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7.1 Grant of Options. Subject to section 5.1, Options may be granted to
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Employees or Consultants at any time and from time to time as determined by the
Board; provided, however, that Consultants may receive only Nonstatutory
Options, and may not receive Incentive Stock Options. The Board shall have
complete discretion in determining the number of Options granted to each
Optionee. In making such determination, the Board may take into account the
nature of services rendered by such Employees or Consultants, their present and
potential contributions to the Company, and such other factors as the Board in
its discretion shall deem relevant. The Board also shall determine whether an
Option is to be an Incentive Stock Option or a Nonstatutory Option.
In the case of Incentive Stock Options, the total Fair Market Value
(determined at the date of grant) of shares of Stock with respect to which
incentive stock options granted after December 31, 1986 are exercisable for the
first time by the Optionee during any calendar year under all plans of the
Company under which
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incentive stock options may be granted (and all such plans of any Parent
Corporations and any Subsidiary Corporations) shall not exceed $100,000.
(Hereinafter, this requirement is sometimes referred to as the "$100,000
Limitation".)
Nothing in this Article VII of the Plan shall be deemed to prevent the
grant of Options permitting exercise in excess of the maximums established by
the preceding paragraph where such excess amount is treated as a Nonstatutory
Option.
The Board is expressly given the authority to issue amended or replacement
Options with respect to shares of Stock subject to an Option previously granted
hereunder. An amended Option amends the terms of an Option previously granted
and thereby supersedes the previous Option. A replacement Option is similar to
a new Option granted hereunder except that it provides that it shall be
forfeited to the extent that a previously granted Option is exercised, or except
that its issuance is conditioned upon the termination of a previously granted
Option.
7.2 No Tandem Options. Where an Option granted under this Plan is
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intended to be an Incentive Stock Option, the Option shall not contain terms
pursuant to which the exercise of the Option would affect the Optionee's right
to exercise another Option, or vice versa, such that the Option intended to be
an Incentive Stock Option would be deemed a tandem stock option within the
meaning of the regulations under Section 422 of the Code.
7.3 Option Agreement; Terms and Conditions to Apply Unless Otherwise
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Specified. As determined by the Board on the date of grant, each Option shall
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be evidenced by an Option agreement (the "Option Agreement") that includes the
nontransferability provisions required by Section 10.2 hereof and specifies:
whether the Option is an Incentive Stock Option or a Nonstatutory Option; the
Option price; the duration of the Option; the number of shares of Stock to which
the Option applies; any vesting or exercisability restrictions which the Board
may impose; in the case of an Incentive Stock Option, a provision setting forth
the $100,000 Limitation; and any other terms or conditions which the Board may
impose. All such terms and conditions shall be determined by the Board at the
time of grant of the Option.
If not otherwise specified by the Board, the following terms and conditions
shall apply to Options granted under the Plan:
(a) Term. The duration of the Option shall be five (5) years and ninety
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(90) days (five (5) years in the case of an Incentive Stock Option
granted to a Significant Shareholder) from the date of grant.
(b) Exercise of Option. Unless an Option is terminated as provided
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hereunder, an Optionee may exercise his Option for up to, but not in
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excess of, the amount of shares subject to the Option specified below,
based on the Optionee's number of years of continuous service with the
Company or a Subsidiary Corporation or Parent Corporation of the
Company from the date on which the Option is granted. In the case of
an Optionee who is an Employee, continuous service shall mean
continuous employment; in the case of an Optionee who is a Consultant,
continuous service shall mean the continuous provision of consulting
services. In applying said limitations, the amount of shares, if any,
previously purchased by the Optionee under the Option shall be counted
in determining the amount of shares the Optionee may purchase at any
time. The Optionee may exercise his Option in the following amounts:
(i) After one (l) year of such continuous services for up to but
not in excess of twenty percent (20%) of the shares originally
subject to the Option;
(ii) After two (2) years of such continuous service, for up to but
not in excess of forty percent (40%) of the shares originally
subject to the Option;
(iii) After three (3) years of such continuous service, for up to but
not in excess of sixty percent (60%) of the shares originally
subject to the Option;
(iv) After four (4) years of such continuous service, for up to but
not in excess of eighty percent (80%) of the shares originally
subject to the Option;
(v) At the expiration of the fifth (5th) year of such continuous
service or upon the earlier retirement of an Optionee at the
normal retirement age of sixty-five (65) or early retirement of
the Optionee with the consent of the Company, the Option may be
exercised at any time and from time to time within its terms in
whole or in part, but it shall not be exercisable after the
expiration of five (5) years and ninety (90) days (five (5)
years in the case of an Incentive Stock Option granted to a
Significant Shareholder) from the date on which it was granted.
The Board shall be free to specify terms and conditions other than those set
forth above, in its discretion.
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All Option Agreements shall incorporate the provisions of this Plan by
reference, with certain provisions to apply depending upon whether the Option
Agreement applies to an Incentive Stock Option or to a Nonstatutory Option.
7.4 Option Price. No Incentive Stock Option granted pursuant to this Plan
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shall have an Option price that is less than the Fair Market Value of Stock on
the date the Option is granted. Incentive Stock Options granted to Significant
Shareholders shall have an Option price of not less than 110 percent of the Fair
Market Value of Stock on the date of grant. The Option price for Nonstatutory
Options shall be established by the Board and shall not be subject to the
restrictions applicable to Incentive Stock Options.
7.5 Term of Options. Each Option shall expire at such time as the Board
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shall determine when it is granted, provided however that no Option shall be
exercisable later than the tenth (10th) anniversary date of its grant. By its
terms, an Incentive Stock Option granted to a Significant Shareholder shall not
be exercisable after five (5) years from the date of grant.
7.6 Exercise of Options. Options granted under the Plan shall be
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exercisable at such times and be subject to such restrictions and conditions as
the Board shall in each instance approve, which need not be the same for all
Optionees.
7.7 Payment. Payment for all shares of Stock shall be made at the time
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that an Option, or any part thereof, is exercised, and no shares shall be issued
until full payment therefor has been made. Payment shall be made (a) in cash,
or (b) if acceptable to the Board, in Stock or in some other form; provided,
however, in the case of an Incentive Stock Option, that said other form of
payment does not prevent the Option from qualifying for treatment as an
"incentive stock option" within the meaning of the Code.
Article VIII. Written Notice, Issuance of Stock Certificates, Stockholder
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Privileges
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8.1 Written Notice. An Optionee wishing to exercise an Option shall give
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written notice to the Company, in the form and manner prescribed by the Board.
Full payment for the shares exercised pursuant to the Option must accompany the
written notice.
8.2 Issuance of Stock Certificates. As soon as practicable after the
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receipt of written notice and payment, the Company shall deliver to the Optionee
or to a nominee of the Optionee a certificate or certificates for the requisite
number of shares of Stock.
8.3 Privileges of a Stockholder. An Optionee or any other person entitled
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to exercise an Option under this Plan shall not have stockholder privileges with
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respect to any Stock covered by the Option until the date of issuance of a stock
certificate for such stock.
Article IX. Termination of Employment or Services
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9.1 Death. If an Optionee's employment in the case of an Employee, or
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provision of services as a Consultant, in the case of a Consultant, terminates
by reason of death, the Option may thereafter be exercised at any time prior to
the expiration date of the Option or within 12 months after the date of such
death, whichever period is the shorter, by the person or persons entitled to do
so under the Optionee's will or, if the Optionee shall fail to make a
testamentary disposition of an Option or shall die intestate, the Optionee's
legal representative or representatives. The Option shall be exercisable only
to the extent that such Option was exercisable as of the date of death.
9.2 Termination Other Than For Cause Or Due to Death. In the event of an
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Optionee's termination of employment, in the case of an Employee, or termination
of the provision of services as a Consultant, in the case of a Consultant, other
than for cause or by reason of death, the Optionee may exercise such portion of
his Option as was exercisable by him at the date of such termination (the
"Termination Date") at any time within three (3) months of the Termination Date;
provided, however, that where the Optionee is an Employee, and is terminated due
to disability within the meaning of Code (S) 422, he may exercise such portion
of his Option as was exercisable by him on his Termination Date within one year
of his Termination Date. In the case of Nonstatutory Options, the Board may
extend the three (3) month exercise period; provided that, in any event, the
Option cannot be exercised after the expiration of the term of the Option.
Options not exercised within the applicable period specified above shall
terminate.
In the case of an Employee, a change of duties or position within the
Company or an assignment of employment in a Subsidiary Corporation or Parent
Corporation of the Company, if any, or from such a Corporation to the Company,
shall not be considered a termination of employment for purposes of this Plan.
The Option Agreements may contain such provisions as the Board shall approve
with reference to the effect of approved leaves of absence upon termination of
employment.
9.3 Termination for Cause. In the event of an Optionee's termination of
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employment, in the case of an Employee, or termination of the provision of
services as a Consultant, in the case of a Consultant, which termination is by
the Company for cause, any Option or Options held by him under the Plan, to the
extent not exercised before such termination, shall forthwith terminate.
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Article X. Rights of Optionees
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10.1 Service. Nothing in this Plan shall interfere with or limit in any
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way the right of the Company to terminate any Employee's employment, or any
Consultant's services, at any time, nor confer upon any Employee any right to
continue in the employ of the Company, or upon any Consultant any right to
continue to provide services to the Company.
10.2 Nontransferability. All Options granted under this Plan shall be
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nontransferable by the Optionee, other than by will or the laws of descent and
distribution, and shall be exercisable during the Optionee's lifetime only by
the Optionee.
Article XI. Optionee-Employee's Transfer or Leave of Absence
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11.1 Optionee-Employee's Transfer or Leave of Absence. For Plan purposes-
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(a) A transfer of an Optionee who is an Employee from the Company to a
Subsidiary Corporation or Parent Corporation, or from one such
Corporation to another, or
(b) a leave of absence for such an Optionee (i) which is duly authorized
in writing by the Company, and (ii) if the Optionee holds an Incentive
Stock Option, which qualifies under the applicable regulations under
the Code which apply in the case of incentive stock options,
shall not be deemed a termination of-employment. However, under no
circumstances may an Optionee exercise an-Option during any leave of absence,
unless authorized by the Board.
Article XII. Amendment, Modification, and Termination of the Plan
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12.1 Amendment, Modification, and Termination of the Plan. The Board may
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at any time terminate, and from time to time may amend or modify the Plan,
provided, however, that no action of the Board, without approval of the
stockholders shall:
(a) increase the total amount of Stock which may be purchased through
Options granted under the Plan, except as provided in Article V; or
(b) change the class of Employees or Consultants eligible to receive
Options.
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No amendment, modification, or termination of the Plan shall in any manner
adversely affect any outstanding Option under the Plan without the consent of
the Optionee holding the Option.
Article XIII. Acquisition, Merger, or Liquidation
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13.1 Acquisition. In the event that an Acquisition occurs with respect to
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the Company, the Company shall have the option, but not the obligation, to
cancel Options outstanding as of the effective date of Acquisition, whether or
not such Options are then exercisable, in return for payment to the Optionees of
an amount equal to a reasonable estimate of an amount (hereinafter the "Spread")
equal to the difference between the net amount per share payable in the
Acquisition, or as a result of the Acquisition, less the exercise price of the
Option. In estimating the Spread, appropriate adjustments to give effect to the
existence of the Options shall be made, such as deeming the Options to have been
exercised, with the Company receiving the exercise price payable thereunder, and
treating the shares receivable upon exercise of the Options as being outstanding
in determining the net amount per share. For purposes of this section, an
"Acquisition" shall mean any transaction in which substantially all of the
Company's assets are acquired or in which a controlling amount of the Company's
outstanding shares are acquired, in each case by a single person or entity or an
affiliated group of persons and/or entities. For purposes of this Section a
controlling amount shall mean more than fifty percent (50%) of the issued and
outstanding shares of Stock of the Company. The Company shall have such an
option regardless of how the Acquisition is effectuated, whether by direct
purchase, through a merger or similar corporate transaction, or otherwise. In
cases where the acquisition consists of the acquisition of assets of the
Company, the net amount per share shall be calculated on the basis of the net
amount receivable with respect to shares upon a distribution and liquidation by
the Company after giving effect to expenses and charges, including but not
limited to taxes, payable by the Company before the liquidation can be
completed.
Where the Company does not exercise its option under this Section 13.1 the
remaining provisions of this Article XIII shall apply, to the extent applicable.
13.2 Merger or Consolidation. Subject to any required action by the
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stockholders, if the Company shall be the surviving corporation in any merger or
consolidation, any Option granted hereunder shall pertain to and apply to the
securities to which a holder of the number of shares of Stock subject to the
Option would have been entitled in such merger or consolidation.
13.3 Other Transactions. A dissolution or a liquidation of the Company or
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a merger and consolidation in which the Company is not the surviving corporation
shall cause every Option outstanding hereunder to terminate as of the effective
date of such dissolution, liquidation, merger or consolidation. However, the
Optionee
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either (i) shall be offered a firm commitment whereby the resulting or surviving
corporation in a merger or consolidation will tender to the Optionee an option
(the "Substitute Option") to purchase its shares on terms and conditions both as
to number of shares and otherwise, which will substantially preserve to the
Optionee the rights and benefits of the Option outstanding hereunder granted by
the Company, or (ii) shall have the right immediately prior to such dissolution,
liquidation, merger, or consolidation to exercise any unexercised Options
whether or not then exercisable, subject to the provisions of this Plan. The
Board shall have absolute and uncontrolled discretion to determine whether the
Optionee has been offered a firm commitment and whether the tendered Substitute
Option will substantially preserve to the Optionee the rights and benefits of
the Option outstanding hereunder. In any event, any Substitute Option for an
Incentive Stock Option shall comply with the requirements of Section 424(a) of
the Code.
Article XIV. Securities Registration
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14.1 Securities Registration. In the event that the Company shall deem it
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necessary or desirable to register under the Securities Act of 1933, as amended,
or any other applicable statute, any Options or any Stock with respect to which
an Option may be or shall have been granted or exercised, or to qualify any such
Options or Stock under the Securities Act of 1933, as amended, or any other
statute, then the Optionee shall cooperate with the Company and take such action
as is necessary to permit registration or qualification of such Options or
Stock.
Unless the Company has determined that the following representation is
unnecessary, each person exercising an Option under the Plan may be required by
the Company, as a condition to the issuance of the shares pursuant to exercise
of the Option, to make a representation in writing (a) that he is acquiring such
shares for his own account for investment and not with a view to, or for sale in
connection with, the distribution of any part thereof, (b) that before any
transfer in connection with the resale of such shares, he will obtain the
written opinion of counsel for the Company, or other counsel acceptable to the
Company, that such shares may be transferred. The Company may also require that
the certificates representing such shares contain legends reflecting the
foregoing.
Article XV. Tax Withholding
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15.1 Tax Withholding. Whenever shares of Stock are to be issued in
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satisfaction of Options exercised under this Plan, the Company shall have the
power to require the recipient of the Stock to remit to the Company an amount
sufficient to satisfy federal, state, and local withholding tax requirements.
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Article XVI. Indemnification
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16.1 Indemnification. To the extent permitted by law, each person who is
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or shall have been a member of the Board shall be indemnified and held harmless
by the Company against and from any loss, cost, liability, or expense that may
be imposed upon or reasonably incurred by him in connection with or resulting
from any claim, action, suit, or proceeding to which he may be a party or in
which he may be involved by reason of any action taken or failure to act under
the Plan and against and from any and all amounts paid by him in settlement
thereof, with the Company's approval, or paid by him in satisfaction of judgment
in any such action, suit, or proceeding against him, provided he shall give the
Company an opportunity, at its own expense, to handle and defend the same before
he undertakes to handle and defend it on his own behalf. The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification to
which such persons may be entitled under the Company's articles of incorporation
or bylaws, as a matter of law, or otherwise, or any power that the Company may
have to indemnify them or hold them harmless.
Article XVII. Requirements of Law
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17.1 Requirements of Law. The granting of Options and the issuance of
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shares of Stock upon the exercise of an Option shall be subject to all
applicable laws, rules, and regulations, and to such approvals by any
governmental agencies or securities exchanges as may be required.
17.2 Governing Law. The Plan, and all agreements hereunder, shall be
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construed in accordance with and governed by the laws of the State of Minnesota.
Article XVIII. Effective Date of Plan
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18.1 Effective Date. The Plan shall be effective on the date of its
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adoption by the Board.
Article XIX. Compliance with Code.
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19.1 Compliance with Code. Incentive Stock Options granted hereunder are
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intended to qualify as "incentive stock options" under the Code. If any
provision of this Plan is susceptible to more than one interpretation, such
interpretation shall be given thereto as is consistent with Incentive Stock
Options granted under this Plan being treated as incentive stack options under
the Code.
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Article XX. No Obligation to Exercise Option.
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20.1 No Obligation to Exercise. The granting of an Option shall impose no
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obligation upon the holder thereof to exercise such Option.
SUMMIT MEDICAL SYSTEMS, INC.
By______________________________________
Its President
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AMENDMENTS TO 1993 STOCK OPTION PLAN
April 28, 1995
The shareholders of Summit Medical Systems, Inc. (the "Company") adopted the
following amendments to the Company's Stock Option Plan of 1993 (the "Plan") at
their annual meeting held on April 28, 1995:
1. The first amendment adopted was to replace in its entirety Section 5.1 of
the Plan with the following text:
5.1 Number. The number of shares of Stock hereby made available and
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reserved for issuance under the Plan is 820,000. The aggregate number of shares
of Stock available under this Plan shall be subject to adjustment as provided in
Section 5.3. The total number of shares of Stock may be authorized but unissued
shares of Stock, or shares acquired by purchase as directed by the Board from
time to time in its discretion, to be used for issuance upon exercise of Options
granted hereunder.
2. The second amendment adopted was to replace in its entirety Section 13.1 of
the Plan with the following text:
13.1 Acquisition. In the event that an Acquisition occurs with respect to
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the Company, the Company shall cancel Options outstanding as of the effective
date of Acquisition, whether or not such Options are then exercisable, in return
for payment to the Optionees of an amount equal to a reasonable estimate of an
amount (hereinafter the "Spread") equal to the difference between the net amount
per share payable in the Acquisition, or as a result of the Acquisition, less
the exercise price of the Option. In estimating the Spread, appropriate
adjustments to give effect to the existence of the Options shall be made, such
as deeming the Options to have been exercised, with the Company receiving the
exercise price payable thereunder, and treating the shares receivable upon
exercise of the Options as being outstanding in determining the net amount per
share. For purposes of this section, an "Acquisition" shall mean any
transaction in which substantially all of the Company's assets are acquired or
in which a controlling amount of the Company's outstanding shares are acquired,
in each case by a single person or entity or an affiliated group of persons
and/or entities. For purposes of this Section a controlling amount shall mean
more than fifty percent (50%) of the issued and outstanding shares of Stock of
the Company. The Company shall have such an obligation regardless of how the
Acquisition is effectuated, whether by direct purchase, through a merger or
similar corporate transaction, or otherwise. In cases where the acquisition
consists of the acquisition of assets of the Company, the net amount per share
shall be calculated on the basis of the net amount receivable with respect to
shares upon a distribution and liquidation by the Company after giving effect to
expenses and charges, including but not limited to taxes, payable by the Company
before the liquidation can be completed.
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If the Company has no obligations under this Section 13.1 the remaining
provisions of this Article XIII shall apply, to the extent applicable.
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SUMMIT MEDICAL SYSTEMS, INC.
SECOND AMENDMENT TO THE 1993 STOCK OPTION PLAN
APRIL 25, 1996
I, Dennis H. Powers, Secretary of Summit Medical Systems, Inc., a Minnesota
corporation (the "Company"), hereby certify on behalf of the Company that in
March of 1996, pursuant to Section 12.1 of the Company's Stock Option Plan of
1993, as amended (the "Plan"), the Board of Directors approved a second
amendment to the Plan providing for the issuance of an additional 1,300,000
shares of common stock under the Plan (the "Second Amendment"). The shareholders
of the Company adopted the Second Amendment at their Annual Meeting held on
April 25, 1996. Accordingly, Section 5.1 of the Plan is hereby amended and
restated as follows:
5.1 Number. The number of shares of Stock hereby made available and
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reserved for issuance under the Plan is 2,126,666. The aggregate number of
shares of Stock available under this Plan shall be subject to adjustment as
provided in Section 5.3. The total number of shares of Stock may be
authorized but unissued shares of Stock, or shares acquired by purchase as
directed by the Board from time to time in its discretion, to be used for
issuance upon exercise of Options granted hereunder.
IN WITNESS WHEREOF, I have hereto signed my name.
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Dennis H. Powers
Secretary
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