MEDICORE, INC.
1989 STOCK OPTION PLAN
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NON-QUALIFIED STOCK OPTION AGREEMENT
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THIS AGREEMENT, dated -------------, is between MEDICORE, INC. (the
"Company") and --------------------, a Participant of the Company ("Par-
ticipant") as defined in the Company's 1989 Stock Option Plan ("Plan").
The purpose of the Agreement is to implement the Plan.
GRANT OF OPTION
The Company has granted the Participant a Non-Qualified Stock Option
("Option") to purchase ---------- shares of the Company's common stock
("Stock").
DEFINITIONS
The terms defined in the Plan shall have the same meaning in this
Agreement.
PURCHASE PRICE
The Option purchase price is $----- per Share.
EXERCISE OF THE OPTION
This paragraph contains rules which govern exercise of the Option.
SHARES PURCHASABLE. Subject to LIMITATION OF EXERCISE the Participant
may exercise the Option any number of times for any number of Shares
each time. However, the total number of Shares purchased may not
exceed the number granted under the Option.
EXERCISE BY PARTICIPANT. While the Participant is alive, only the Par-
ticipant or the Participant's guardian or legal representative may
exercise the Option. The Participant must be continuously Affiliated
with the Company from the date of this Agreement to the date the
Participant exercises the Option except that the sections on
RETIREMENT, DISABILITY OR DEATH, CHANGES IN CONTROL and EXPIRATION
OF OPTION contain special rules which may permit exercise of the
Option after termination of Affiliation.
RETIREMENT, DISABILITY OR DEATH. If the Participant retires, becomes
permanently disabled or dies while Affiliated, the Participant or the
Participant's
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Successor, as the case may be, may exercise the Option within six
months after such termination. Notwithstanding anything in this
Agreement to the contrary, upon permanent disability or death of
the Participant or upon any Change in Control other than initiated
and caused by the Participant, all the Participant's outstanding
Options shall become immediately exercisable in full.
CHANGES IN CONTROL. If the Participant has an Affiliation with the
Company immediately prior to the Change in Control as described in
Section 8 of the Plan, the Options, upon any Change in Control, held
by the Participant shall become fully exercisable and shall immedi-
ately be redeemed by the Company or its successor, as the case may
be, in cash in an amount equal to the excess of the greater of the
price per Share paid in such Change in Control or the Fair Market
Value on the date or during the periods as provided for in Section
8 of the Plan, over the Option Exercise Price; provided that the
Participant has the right to keep the Option if Participant files such
election with the Company or surviving corporation, as the case may
be, within five (5) days of Participant's receipt of written notifi-
cation of redemption due to such Change in Control.
EXPIRATION OF OPTION. The Option will expire the earlier of (i) six (6)
months from retirement, permanent disability or death, or (ii) five (5)
years from the date of this Agreement. The Option will be redeemed
upon occurrence of a Change in Control as provided in Section 8 of
the Plan; provided that if notice is given by the Participant of his
election to keep the Options as opposed to redemption, the Options
shall continue as provided in the first sentence of this paragraph,
notwithstanding the Participant may no longer have any Affiliation
with the Company. If termination is for cause, the Option will
expire upon receipt by the Participant of written notice of termina-
tion, except that Participant establishes that the cause termination
was improper.
TERMINATION OF AFFILIATION. Termination of Affiliation does not
include (a) a leave of absence approved by the Committee, or (b)
any transfer between the Company and an Affiliate or between
Affiliates.
LIMITATION OF EXERCISE. The Participant may not exercise the Options
granted for a period of one year from the date of grant. Subsequent
to the first anniversary date of the grant of an Option, the Partici-
pant may exercise the Option to the extent of fifty (50%) percent
thereof and the full amount on and after the second anniversary of
the grant of the Option; provided, however, that any termination by
permanent disability, death or Change in Control will entitle the
Participant or his Successor to exercise the Option in full to the
extent the Participant did not initiate and cause any such Change in
Control.
No one may exercise an Option after the later of the periods set forth
in the Section EXPIRATION OF OPTION.
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MANNER OF EXERCISE
NOTICE OF EXERCISE. The Option may be exercised by sending written
notice of exercise to the Company's Secretary at 000 Xxxxxxx Xxxxxx,
Xxxxxxxxx Xxxxxxx, Xxx Xxxxxx 00000, or to such other person or
address as the Participant may be notified in writing. To comply
with any deadline, the notice of exercise must be received before the
close of business on the last day of the deadline.
The notice must be signed by the person exercising the Option. If
that person is not the Participant, proof of that person's right to
exercise the Option must be furnished with the notice.
The notice must state the number of Shares to be purchased and must
be accompanied by payment of the Exercise Price in accordance with
procedures established by the Company.
PAYMENT OF PURCHASE PRICE. The purchase price may be paid either (a)
in cash or by certified or bank cashier's check payable to the order
of the Company, or (b) in Shares or (c) partly in cash and partly in
Shares, or (d) with a ten (10%) percent down payment in cash or Stock
(not less than the product of the par value of Stock multiplied by
the number of Shares being purchased upon exercise of the Option) and
a recourse promissory note in the principal amount equal to the
difference between the aggregate Exercise Price and the down payment,
payable in three (3) years, bearing interest at the prime rate then
being charged by the Company's primary bank and secured by collateral
having a value equal to the principal amount of the note. If Stock
is used for the Exercise Price (a "stock-for-stock swap transaction"),
the Stock used must have been owned by the Participant for at least
six months prior to the date of exercise and must not have been used
in a stock-for-stock swap transaction within the preceding six months
(i.e., the Stock must be "mature").
The amount of the Exercise Price paid in Stock will be equal to the
Fair Market Value of the Stock as of the date of exercise. The Stock
so delivered to exercise an Option shall be free and clear of all
liens, pledges, claims, encumbrances or restrictions of any kind or
nature whatsoever, other than restrictions imposed upon such Shares
pursuant to the provisions of the federal and state securities laws.
ISSUANCE OF CERTIFICATES. When the Option is exercised and payment is
made in cash, the Company will deliver certificate(s) for the Shares
purchased to the person exercising the Option. When the Option is
exercised and payment is made in Stock, the Company, in its
discretion, may permit the person exercising the Option to retain
the Shares tendered as payment for the purchase price and may deliver
to the person exercising the Option certificate(s) for the net Shares
purchased. If the Participant makes the election described in the
section on WITHHOLDING OF TAXES, the Company may deliver certifi-
cate(s) for the purchased Shares as described in this section less any
Shares withheld to satisfy withholding taxes. The Company will pay
all issue and transfer taxes and all expenses of the Company
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incurred in connection with exercise of the Option. All Shares will
be fully paid and non-assessable.
Subject to GENERAL RESTRICTIONS as soon as practicable after receipt
of such notice and payment, the Company shall deliver to the Partici-
pant at such place as may be mutually acceptable, or, at the election
of the Company by mail addressed to the Participant at the address
of the Participant as indicated in the records of the Company, a
certificate or certificates for such Shares registered in the name of
the Participant (or in the name of his estate or heirs upon an
exercise by Participant's Successor). The Option may be exercised
only with respect to full Shares, and no fractional Shares will be
issued upon exercise of the Option.
AWARD OF ADDITIONAL STOCK OPTION
Effective as of the date of exercise by the Participant of all or part of
this Option to the extent mature Stock is used as payment for the Exercise
Price, the Participant is hereby granted Additional Non-Qualified Stock
Options ("ANSO") to purchase, at the Fair Market Value as of the date of
said exercise and grant, the number of Shares equal to the sum of the
number of whole Shares used by the Participant in payment of the Exercise
Price and the number of whole Shares, if any, withheld by the Company as
payment for withholding taxes. The ANSO may be exercised between the date
of grant and the date of expiration, which shall be the same as the date
of expiration of this Option to which the ANSO is related. The ANSO shall
be evidenced by an agreement containing such other terms and conditions
and not inconsistent with the Plan as the Committee shall approve.
LIMITATIONS ON TRANSFER OF OPTION
This Option may be transferred by will or inheritance only, except as
provided under EXERCISE OF OPTION relating to CHANGE IN CONTROL.
STOCKHOLDER RIGHTS BEFORE EXERCISE
The Participant will not have any stockholder rights for Shares under this
Option until the Option is properly exercised.
DISCONTINUANCE OF AFFILIATION
Nothing in this Agreement gives the Participant any right to continued
Affiliation. The Company may terminate the Participant's Affiliation or
take any other action regardless of the effect it might have on the
Participant under this Agreement.
ADJUSTMENT PROVISIONS
Supplementing Section 14 of the Plan, if prior to the expiration of the
Option there shall be any change in the capital of the Company, the Shares
covered by this Option and the Exercise Price payable therefor shall in
each instance be adjusted as follows:
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(a) If a Share dividend is declared on the Stock of the Company,
there shall be added to the Shares under this Option the number of Shares
which would have been issuable to the Participant had the Participant been
the holder of record of the number of Shares then under the Option but not
theretofore purchased and issued hereunder. Such additional Shares
resulting from such Share dividend shall be delivered proportionately,
from time to time, without additional cost, upon the exercise of this
Option. Any distribution to the holders of the Stock of the Company,
other than a distribution of cash as a dividend out of surplus or net
profits or a distribution by way of the granting of rights to subscribe,
shall be treated as a Share dividend.
(b) If an increase has been effected in the number of outstanding
Shares by reason of a subdivision of such Shares, the number of Shares
which may thereafter be purchased under this Option shall be the number
of Shares which would have been received by Participant on such sub-
division had the Participant been the holder of record of the number of
Shares then under Option but not theretofore purchased and issued
hereunder. In such event, the Exercise Price per Share under this Option
shall be proportionately reduced.
(c) If the Company grants to the holders of Stock rights to subscribe
for additional Shares or securities, there shall be added to the number of
Shares which may thereafter be purchased under this Option the Shares or
securities to which Participant would have been entitled to subscribe had
the Participant been the holder or record of the number of Shares then
under Option but not theretofore purchased and issued hereunder. In such
event, the Exercise Price at which Participant shall have the right to
purchase such additional Shares or securities shall be the subscription
price payable by shareholders of record upon the issuance to them of such
Shares or securities. Participant shall have the right to purchase such
additional Shares or securities only proportionately with the exercise of
this Option, but until so purchased or until the expiration of this Option
as to such additional Shares or securities, such additional Shares or
securities shall be subject to adjustment as provided in this paragraph
in the same manner and to the same extent as the Shares covered by this
Option.
(d) If there is any capital reorganization or reclassification of the
capital of the Company, adequate provision shall be made by the Company so
that there shall remain and be substituted under this Option the Shares
and securities which would have been issuable or payable in respect of or
in exchange for the Stock then remaining under this Option and not there-
tofore purchased and issued hereunder, as if Participant had been the
owner of such Shares on the applicable record date. Any Shares so sub-
stituted under this Option shall be subject to adjustment as provided in
this paragraph in the same manner and to the same effect as the Shares
covered by this Option.
GENERAL RESTRICTIONS
The Company may delay the exercise of any Option if it determines that
the Shares subject to the Option are required to be listed, registered or
qualified on any securities exchange or under any law. The exercise of
the Option may be delayed until the Company is satisfied that appropriate
action has been taken. No delay under this paragraph will affect the date
of expiration of this Option.
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WITHHOLDING OF TAXES
If the Participant recognizes ordinary income on the exercise of the
Option, it may be necessary to withhold income taxes and social security
taxes. The Participant agrees to pay the Company to satisfy any with-
holding obligations. Payment may be made by the Participant in cash or,
at the election of the Participant, the Company may withhold from the
Shares to be issued the number of Shares (based on the Fair Market Value
of the Stock as of the date of exercise) that would satisfy the with-
holding taxes due (except that any fractional Share amount shall be paid
by the Participant in cash). The Company will not be obligated to deliver
Shares under this Agreement until withholding obligations are met.
ADDITIONAL PROVISIONS AND INTERPRETATION OF THIS AGREEMENT
This Agreement is subject to the provisions of the Plan which are incor-
porated by reference herein. If the Plan and this Agreement are
inconsistent, provisions of the Plan will govern. Interpretations of
the Plan and this Agreement by the Committee are binding on the Company
and the Participant.
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Participant
MEDICORE, INC.
By:-------------------------
XXXXXX X. XXXXXX, Senior
Vice President
