ACUSON CORPORATION EXHIBIT 10.31
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ACUSON CORPORATION
NON-QUALIFIED STOCK OPTION TERMS
Acuson Corporation (the "Company") has this day granted to you an option
(the "Option") to purchase shares of common stock of the Company. This Option
is granted pursuant to the Company's 1995 Stock Incentive Plan (the "Plan") and
is not intended to qualify as an "incentive stock option" within the meaning of
Section 422 of the Internal Revenue Code of 1986, as amended (the "Code").
Details of this Option are contained in the Notice of Grant of Stock Options and
Grant Agreement (the "Notice") to which these Non-Qualified Stock Option Terms
(the "Option Terms") are attached (the Notice and the Option Terms collectively
the "Agreement"). Capitalized terms not otherwise defined herein have the
meanings given to them in the Plan.
The details of this Option are as follows:
1. (a) The total number of shares subject to this Option is set forth in the
Notice. Subject to the limitations contained herein, commencing on the date on
the Notice specified as the "Beginning Vesting Date", the share of this Option
shall vest and become exercisable as follows: twenty percent (20%) of the total
number of shares subject to this Option shall vest and become exercisable on the
first anniversary of the Beginning Vesting Date, twenty percent (20%) shall vest
and become exercisable on the second anniversary of such date, thirty percent
(30%) shall vest and become exercisable on the third anniversary of such date,
and the remaining thirty percent (30%) shall vest and become exercisable on the
fourth anniversary of such date. No share of this Option may be exercised until
such share has vested, and vesting will stop on the date of termination of your
employment or relationship as a consultant with the Company or an Affiliate of
the Company for any reason or no reason including death or disability. All
shares not vested as of such termination date shall be cancelled.
(b) Notwithstanding anything to the contrary contained in this paragraph
1, the total number of shares subject to this Option shall fully vest and become
exercisable, automatically and without any further action by the parties hereto,
upon the occurrence of certain events constituting a change in control of the
Company as provided in Section 12 of the Plan.
2. (a) The exercise price per share of the Stock subject to this Option is
set forth in the Notice.
(b) The purchase price of Stock acquired pursuant to this Option shall be
paid at the time of exercise, to the extent permitted by applicable statutes and
regulations, by (i) personal check, certified check, bank draft, or postal money
order payable to the order of Acuson Corporation in lawful money of the United
States (collectively, "Cash Consideration"); (ii) delivery on a form prescribed
by the Company of an irrevocable direction to a securities broker approved by
the Company to sell shares of Stock and deliver all or a portion of the proceeds
to the Company in payment for the Stock issuable upon exercise of this Option;
(iii) surrender to the Company of shares of Stock (or delivery of a properly
executed form of attestation of
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Acuson Corporation
Non-Qualified Stock Option Terms
ownership of shares of Stock) that have been held for the requisite period
necessary to avoid a charge to the Company's reported earnings and valued at the
fair market value on the date of exercise (determined by the closing sale price
per share of Stock for such date); or (iv) in any combination of the foregoing.
3. The minimum number of shares of Stock with respect to which this Option may
be exercised at any one time is twenty-five (25), except (i) with respect to an
installment subject to vesting, as set forth in paragraph 1, which amounts to
fewer than twenty-five (25) shares, in which case the minimum number of
exercisable shares for that installment shall be the number of shares in such
installment, and (ii) with respect to the final exercise of this Option no
minimum shall apply. In no event may this Option be exercised for anything but
whole shares.
4. Notwithstanding anything to the contrary contained herein, this Option may
not be exercised unless the shares issuable upon exercise of this Option are
then registered under the Securities Act of 1933, as amended (the "Securities
Act"), or, if such shares are not then so registered, the Company has determined
that such exercise and issuance would be exempt from the registration
requirements of the Securities Act.
5. The term of this Option commences on the grant date as set forth in the
Notice and, unless sooner terminated as set forth below or in the Plan,
terminates on the date set forth in the Notice (the "Scheduled Termination
Date"). Prior to the Scheduled Termination Date, this Option shall terminate
three (3) months after the termination of your employment or relationship as a
consultant with the Company or an Affiliate of the Company for any reason or for
no reason unless:
(a) such termination of employment or relationship as a consultant is due
to your permanent and total disability (within the meaning of Section 422(c)(6)
of the Code), in which event this Option shall terminate on the earlier of the
Scheduled Termination Date or one (1) year following such termination of
employment or relationship as a consultant; or
(b) such termination of employment or relationship as a consultant is due
to your death, or your death occurs within three (3) months after such
termination of employment or relationship as a consultant, in which event this
Option shall terminate on the earlier of the Scheduled Termination Date or
eighteen (18) months after your death; or
(c) during any part of such three (3) month period this Option is not
exercisable solely because of the condition set forth in paragraph 4 above, in
which event this Option shall not terminate until the earlier of the Scheduled
Termination Date or until it shall have been exercisable for an aggregate period
of three (3) months after the termination of your employment or relationship as
a consultant; or
(d) exercise of this Option within three (3) months after termination of
your employment or relationship as a consultant would result in liability under
section 16(b) of the Securities Exchange Act of 1934, as amended, in which case
this Option will terminate on the earliest of (i) the Scheduled Termination
Date, (ii) the tenth (10th) day after the last date upon
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Acuson Corporation
Non-Qualified Stock Option Terms
which exercise would result in such liability, or (iii) six (6) months and ten
(10) days after the termination of your employment or relationship as a
consultant.
This Option may not be exercised after it terminates. In addition, you may
exercise this Option only as to that number of shares vested on the date of your
termination of employment or relationship as a consultant under the provisions
of paragraph 1 of this Option.
6. (a) This Option may be exercised, to the extent specified above, by
delivering a notice of exercise together with the exercise price to the
Secretary of the Company, or to such other person as the Company may designate,
during regular business hours, together with such additional documents as the
Company may then require.
(b) By exercising this Option you agree that the Company may require you
to enter into an arrangement providing for the cash payment by you to the
Company of any tax withholding obligation of the Company arising by reason of
(i) the exercise of this Option, (ii) the lapse of any substantial risk of
forfeiture to which the shares are subject at the time of exercise, or (iii) the
disposition of shares acquired upon such exercise.
7. This Option is not transferable, except by will or by the laws of descent
and distribution, and is exercisable during your life only by you.
8. This Option is not an employment or consulting contract, and nothing in
this Option shall confer upon you any right to continue in the employ (or to
continue acting as a consultant) of the Company or an Affiliate of the Company
or shall affect the right of the Company or an Affiliate of the Company to
terminate your employment or consulting relationship with or without cause.
9. Any notices provided for in this Option or the Plan shall be given in
writing and shall be deemed effectively given upon receipt or, in the case of
notices delivered by the Company to you, five (5) days after deposit in the
United States mail, postage prepaid, addressed to you at the address specified
in the Company's records or at such other address as you may designate by
written notice to the Company.
10. This Option is subject to all the provisions of the Plan, a copy of which
is attached hereto and is incorporated by reference herein, and is further
subject to all interpretations, amendments, rules, and regulations which may
from time to time be promulgated and adopted pursuant to the Plan. In the event
of any conflict between the provisions of this Agreement and those of the Plan,
the provisions of the Plan shall control.
This Option is dated and effective as of the date of grant as set forth in
the Notice.
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