QuickLinks -- Click here to rapidly navigate through this document

Exhibit 10.1

MDMI HOLDINGS, INC.

2000 STOCK OPTION AND INCENTIVE PLAN

--------------------------------------------------------------------------------

TABLE OF CONTENTS

 
   
   
  Page

--------------------------------------------------------------------------------

1.   PURPOSE   1 2.   DEFINITIONS   1 3.   ADMINISTRATION OF THE PLAN   3    
3.1.   Board   3     3.2.   Committee   3     3.3.   Grants   3     3.4.   No
Liability   4 4.   STOCK SUBJECT TO THE PLAN   4 5.   EFFECTIVE DATE AND TERM OF
THE PLAN   4     5.1.   Effective Date   4     5.2.   Term   4 6.   OPTION
GRANTS   5     6.1.   Employees; Service Providers; or Other Persons   5    
6.2.   Successive Grants   5 7.   LIMITATIONS ON GRANTS   5     7.1.  
Limitations on Incentive Stock Options   5     7.2.   Limitation on Shares of
Stock Subject to Grants   5 8.   AWARD AGREEMENT   5 9.   OPTION PRICE   5 10.  
VESTING, TERM AND EXERCISE OF OPTIONS   6     10.1.   Vesting and Option Period
  6     10.2.   Term   6     10.3.   Acceleration   6     10.4.   Termination of
Employment or Other Relationship   6     10.5.   Rights in the Event of Death  
6     10.6.   Rights in the Event of Disability   7     10.7.   Limitations on
Exercise of Option   7     10.8.   Method of Exercise   7     10.9.   Delivery
of Stock Certificates   8 11.   TRANSFERABILITY OF OPTIONS   8     11.1.  
Transferability of Options   8     11.2.   Transfers   8         11.2.1. Family
Transfers   8         11.2.2. Company Approved Transfers   8 12.   RESTRICTED
STOCK AND RESTRICTED STOCK UNITS   8     12.1.   Grant of Restricted Stock or
Restricted Stock Units   8     12.2.   Restrictions   8     12.3.   Restricted
Stock Certificates   9     12.4.   Rights of Holders of Restricted Stock   9    
12.5.   Rights of Holders of Restricted Stock Units   9     12.6.   Termination
of Employment or Other Relationship   9     12.7.   Rights in the Event of Death
  10     12.8.   Rights in the Event of Disability   10     12.9.   Delivery of
Stock and Payment Therefor   10 13.   NONTRANSFERABILITY OF SHARES; REPURCHASE
RIGHTS   10     13.1.   Nontransferability of Shares   10     13.2.   Repurchase
Rights   11     13.3.   Installment Payments   11     13.4.   Publicly Traded
Stock   11     13.5.   Legend   11              

--------------------------------------------------------------------------------

14.   CERTAIN PROVISIONS APPLICABLE TO AWARDS   11     14.1.   Stand-Alone,
Additional, Tandem, and Substitute Grants   11     14.2.   Term of Grant   12  
  14.3.   Form and Timing of Payment Under Grants; Deferrals   12 15.  
PARACHUTE LIMITATIONS   12 16.   REQUIREMENTS OF LAW   13     16.1.   General  
13     16.2.   Rule 16b-3   13 17.   AMENDMENT AND TERMINATION OF THE PLAN   13
18.   EFFECT OF CHANGES IN CAPITALIZATION   14     18.1.   Changes in Stock   14
    18.2.   Reorganization in Which the Company Is the Surviving Entity and in
Which No Change of Control Occurs   14     18.3.   Reorganization, Sale of
Assets or Sale of Stock Which Involves a Change of Control   14     18.4.  
Adjustments   15     18.5.   No Limitations on Company   15 19.   DISCLAIMER OF
RIGHTS   15 20.   NONEXCLUSIVITY OF THE PLAN   15 21.   WITHHOLDING TAXES   16
22.   CAPTIONS   16 23.   OTHER PROVISIONS   16 24.   NUMBER AND GENDER   16 25.
  SEVERABILITY   16 26.   POOLING   16 27.   GOVERNING LAW   17 28.   BLUE SKY
PROVISIONS   17     28.1.   California Provisions   17     28.2.   Limitations
on Grants to Non-Employees   18

--------------------------------------------------------------------------------

FIRST AMENDMENT TO MDMI HOLDINGS, INC. 2000 STOCK OPTION AND INCENTIVE PLAN

        Effective August 12, 2000 and subject to approval by the Plan by the
stockholders, Section 4 of the MDMI Holdings, Inc. 2000 Stock Option and
Incentive Plan shall read as follows:

Subject to adjustment as provided in Section 18 hereof, the number of shares of
Stock available for issuance under the Plan shall be SIX HUNDRED FORTY THOUSAND
FIFTY-SIX (640,056). Stock issued or to be issued under the Plan shall be
authorized but unissued shares. If any shares covered by a Grant are not
purchased or are forfeited, or if a Grant otherwise terminates without delivery
of any Stock subject thereto, then the number of shares of Stock counted against
the aggregate number of shares available under the Plan with respect to such
Grant shall, to the extent of any such forfeiture or termination, again be
available for making Grants under the Plan.

SECOND AMENDMENT TO MDMI HOLDINGS, INC. 2000 STOCK OPTION AND INCENTIVE PLAN

        Effective December 6, 2000 and subject to approval by the Plan by the
stockholders, Section 4 of the MDMI Holdings, Inc. 2000 Stock Option and
Incentive Plan shall read as follows:

Subject to adjustment as provided in Section 18 hereof, the number of shares of
Stock available for issuance under the Plan shall be EIGHT HUNDRED FORTY
THOUSAND (840,000). Stock issued or to be issued under the Plan shall be
authorized but unissued shares. If any shares covered by a Grant are not
purchased or are forfeited, or if a Grant otherwise terminates without delivery
of any Stock subject thereto, then the number of shares of Stock counted against
the aggregate number of shares available under the Plan with respect to such
Grant shall, to the extent of any such forfeiture or termination, again be
available for making Grants under the Plan.

--------------------------------------------------------------------------------

MDMI HOLDINGS, INC.
2000 STOCK OPTION AND INCENTIVE PLAN

        MDMI Holdings, Inc., a Colorado corporation (the "Company"), sets forth
herein the terms of its 2000 Stock Option and Incentive Plan (the "Plan") as
follows:

1.     PURPOSE

        The Plan is intended to enhance the Company's and its affiliates' (as
defined herein) ability to attract and retain highly qualified officers,
directors, key employees, and other persons, and to motivate such officers,
directors, key employees, and other persons to serve the Company and its
affiliates and to expend maximum effort to improve the business results and
earnings of the Company, by providing to such officers, key employees and other
persons an opportunity to acquire or increase a direct proprietary interest in
the operations and future success of the Company. To this end, the Plan provides
for the grant of stock options, restricted stock and restricted stock units in
accordance with the terms hereof. Stock options granted under the Plan may be
non-qualified stock options or incentive stock options, as provided herein.

2.     DEFINITIONS

        For purposes of interpreting the Plan and related documents (including
Award Agreements), the following definitions shall apply:

        2.1   "affiliate" of, or person "affiliated" with, a person means any
company or other trade or business that controls, is controlled by or is under
common control with such person within the meaning of Rule 405 of Regulation C
under the Securities Act, including, without limitation, any Subsidiary.

        2.2   "Award Agreement" means the stock option agreement, restricted
stock agreement, restricted stock unit agreement or other written agreement
between the Company and a Grantee that evidences and sets out the terms and
conditions of a Grant.

        2.3   "Benefit Arrangement" shall have the meaning set forth in
Section 15 hereof.

        2.4   "Board" means the Board of Directors of the Company.

        2.5   "Change of Control" means (i) the dissolution or liquidation of
the Company or a merger, consolidation, or reorganization of the Company with
one or more other entities in which the Company is not the surviving entity,
(ii) a sale of substantially all of the assets of the Company to another entity,
or (iii) any transaction (including without limitation a merger or
reorganization in which the Company is the surviving entity) which results in
any person or entity (other than persons who are shareholders or affiliates of
the Company at the time the Plan is approved by the Company's shareholders)
owning 80% or more of the combined voting power of all classes of stock of the
Company.

        2.6   "Code" means the Internal Revenue Code of 1986, as now in effect
or as hereafter amended.

        2.7   "Committee" means a committee of, and designated from time to time
by resolution of, the Board, which shall consist of no fewer than two members of
the Board, none of whom shall be an officer or other salaried employee of the
Company or any affiliate of the Company.

        2.8   "Company" means MDMI Holdings, Inc.

        2.9   "Effective Date" means February 3, 2000, the date the Plan is
approved by the Board.

        2.10 "Exchange Act" means the Securities Exchange Act of 1934, as now in
effect or as hereafter amended.

1

--------------------------------------------------------------------------------

        2.11 "Fair Market Value" means the value of a share of Stock, determined
as follows: if on the Grant Date or other determination date the Stock is listed
on an established national or regional stock exchange, is admitted to quotation
on The Nasdaq Stock Market, Inc., or is publicly traded on an established
securities market, the Fair Market Value of a share of Stock shall be the
closing price of the Stock on such exchange or in such market (the highest such
closing price if there is more than one such exchange or market) on the Grant
Date or such other determination date (or if there is no such reported closing
price, the Fair Market Value shall be the mean between the highest bid and
lowest asked prices or between the high and low sale prices on such trading day)
or, if no sale of Stock is reported for such trading day, on the next preceding
day on which any sale shall have been reported. If the Stock is not listed on
such an exchange, quoted on such system or traded on such a market, Fair Market
Value shall be the value of the Stock as determined by the Board in good faith.

        2.12 "Family Member" means a person who is a spouse, child, stepchild,
grandchild, parent, stepparent, grandparent, niece, nephew, sibling,
mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or
sister-in-law, including adoptive relationships, of the Grantee, any person
sharing the Grantee's household (other than a tenant or employee), a trust in
which these persons have more than fifty percent of the beneficial interest, a
foundation in which these persons (or the Grantee) control the management of
assets, and any other entity in which these persons (or the Grantee) own more
than fifty percent of the voting interests.

        2.13 "Grant" means an award of an Option, Restricted Stock or Restricted
Stock Units under the Plan.

        2.14 "Grant Date" means, as determined by the Board or authorized
Committee, (1) the date as of which the Board or such Committee approves a
Grant, (ii) the date on which the recipient of a Grant first becomes eligible to
receive a Grant under Section 6 hereof, or (iii) such other date as may be
specified by the Board or such Committee.

        2.15 "Grantee" means a person who receives or holds an Option,
Restricted Stock or Restricted Stock Units under the Plan.

        2.16 "Incentive Stock Option" means an "incentive stock option" within
the meaning of Section 422 of the Code, or the corresponding provision of any
subsequently enacted tax statute, as amended from time to time.

        2.17 "Option" means an option to purchase one or more shares of Stock
pursuant to the Plan.

        2.18 "Option Period" means the period during which Options may be
exercised as set forth in Section 10 hereof.

        2.19 "Option Price" means the purchase price for each share of Stock
subject to an Option.

        2.20 "Other Agreement" shall have the meaning set forth in Section 15
hereof.

        2.21 "Plan" means this MDMI Holdings, Inc. 2000 Stock Option and
Incentive Plan.

        2.22 "Reporting Person" means a person who is required to file reports
under Section 16(a) of the Exchange Act.

        2.23 "Restricted Period" means the period during which Restricted Stock
or Restricted Stock Units are subject to restrictions or conditions pursuant to
Section 12.2 hereof.

        2.24 "Restricted Stock" means shares of Stock, awarded to a Grantee
pursuant to Section 12 hereof, that are subject to restrictions and to a risk of
forfeiture.

        2.25 "Restricted Stock Unit" means a unit awarded to a Grantee pursuant
to Section 12 hereof, which represents a conditional right to receive a share of
Stock in the future, and which is subject to restrictions and to a risk of
forfeiture.

2

--------------------------------------------------------------------------------

        2.26 "Securities Act" means the Securities Act of 1933, as now in effect
or as hereafter amended.

        2.27 "Service Provider" means a director, consultant or adviser to the
Company or an affiliate, a manager of the Company's or an affiliate's properties
or affairs, or other similar service provider or affiliate of the Company, and
employees of any of the foregoing, as such persons may be designated from time
to time by the Board pursuant to Section 6 hereof.

        2.28 "Stock" means the common stock, $.01 par value per share, of the
Company.

        2.29 "Subsidiary" means any "subsidiary corporation" of the Company
within the meaning of Section 424(f) of the Code.

        2.30 "Termination Date" means the date upon which an Option shall
terminate or expire, as set forth in Section 10.2 hereof.

3.     ADMINISTRATION OF THE PLAN

        3.1.  Board.

        The Board shall have such powers and authorities related to the
administration of the Plan as are consistent with the Company's certificate of
incorporation and by-laws and applicable law. The Board shall have full power
and authority to take all actions and to make all determinations required or
provided for under the Plan, any Grant or any Award Agreement, and shall have
full power and authority to take all such other actions and make all such other
determinations not inconsistent with the specific terms and provisions of the
Plan that the Board deems to be necessary or appropriate to the administration
of the Plan, any Grant or any Award Agreement. All such actions and
determinations shall be by the affirmative vote of a majority of the members of
the Board present at a meeting or by unanimous consent of the Board executed in
writing in accordance with the Company's certificate of incorporation and
by-laws and applicable law. The interpretation and construction by the Board of
any provision of the Plan, any Grant or any Award Agreement shall be final and
conclusive. As permitted by law, the Board may delegate its authority under the
Plan to a member of the Board or an executive officer of the Company who is a
member of the Board.

        3.2.  Committee.

        The Board from time to time may delegate to a Committee such powers and
authorities related to the administration and implementation of the Plan, as set
forth in Section 3.1 above and in other applicable provisions, as the Board
shall determine, consistent with the certificate of incorporation and by-laws of
the Company and applicable law. In the event that the Plan, any Grant or any
Award Agreement entered into hereunder provides for any action to be taken by or
determination to be made by the Board, such action may be taken by or such
determination may be made by the Committee if the power and authority to do so
has been delegated to the Committee by the Board as provided for in this
Section. Unless otherwise expressly determined by the Board, any such action or
determination by the Committee shall be final, binding and conclusive. As
permitted by law, the Committee may delegate its authority under the Plan to a
member of the Board or an executive officer of the Company who is a member of
the Board.

        3.3.  Grants.

        Subject to the other terms and conditions of the Plan, the Board shall
have full and final authority (i) to designate Grantees, (ii) to determine the
type or types of Grant to be made to a Grantee, (iii) to determine the number of
shares of Stock to be subject to a Grant, (iv) to establish the terms and
conditions of each Grant (including, but not limited to, the exercise price of
any Option, the nature and duration of any restriction or condition (or
provision for lapse thereof) relating to the vesting, exercise, transfer, or
forfeiture of a Grant or the shares of Stock subject thereto, and any terms or
conditions that may be necessary to qualify Options as Incentive Stock Options),
(v) to prescribe the

3

--------------------------------------------------------------------------------

form of each Award Agreement evidencing a Grant, and (vi) to amend, modify, or
supplement the terms of any outstanding Grant. Such authority specifically
includes the authority, in order to effectuate the purposes of the Plan but
without amending the Plan, to modify Grants to eligible individuals who are
foreign nationals or are individuals who are employed outside the United States
to recognize differences in local law, tax policy, or custom. As a condition to
any Grant, the Board shall have the right, at its discretion, to require
Grantees to return to the Company Grants previously awarded under the Plan.
Subject to the terms and conditions of the Plan, any such subsequent Grant shall
be upon such terms and conditions as are specified by the Board at the time the
new Grant is made. The Company may retain the right in an Award Agreement to
cause a forfeiture of the gain realized by a Grantee on account of actions taken
by the Grantee in violation or breach of or in conflict with any non-competition
agreement, any agreement prohibiting solicitation of employees or clients of the
Company or any affiliate thereof or any confidentiality obligation with respect
to the Company or any affiliate thereof or otherwise in competition with the
Company, to the extent specified in such Award Agreement applicable to the
Grantee. Furthermore, the Company may annul a Grant if the Grantee is an
employee of the Company or an affiliate thereof and is terminated "for cause" as
defined in the applicable Award Agreement. The Board may permit or require the
deferral of any award payment, subject to such rules and procedures as it may
establish, which may include provisions for the payment or crediting of interest
or dividend equivalents, including converting such credits into deferred Stock
equivalents.

        3.4.  No Liability.

        No member of the Board or of the Committee shall be liable for any
action or determination made in good faith with respect to the Plan or any Grant
or Award Agreement.

4.     STOCK SUBJECT TO THE PLAN

        Subject to adjustment as provided in Section 18 hereof, the number of
shares of Stock available for issuance under the Plan shall be SIX HUNDRED
THOUSAND (600,000). Stock issued or to be issued under the Plan shall be
authorized but unissued shares. If any shares covered by a Grant are not
purchased or are forfeited, or if a Grant otherwise terminates without delivery
of any Stock subject thereto, then the number of shares of Stock counted against
the aggregate number of shares available under the Plan with respect to such
Grant shall, to the extent of any such forfeiture or termination, again be
available for making Grants under the Plan.

5.     EFFECTIVE DATE AND TERM OF THE PLAN

        5.1.  Effective Date.

        The Plan shall be effective as of the Effective Date, subject to
approval of the Plan within one year of the Effective Date, by a majority of the
votes cast on the proposal at a meeting of shareholders, provided that a quorum
is present or by the written consent of the holders of a majority of the
Company's shares of Stock entitled to vote. Upon approval of the Plan by the
shareholders of the Company as set forth above, all Grants made under the Plan
on or after the Effective Date shall be fully effective as if the shareholders
of the Company had approved the Plan on the Effective Date. If the shareholders
fail to approve the Plan within one year after the Effective Date, any Grants
made hereunder shall be null and void and of no effect.

        5.2.  Term.

        The Plan has no termination date; however, no Incentive Stock Option may
be granted under the Plan on or after the tenth anniversary of the Effective
Date.

4

--------------------------------------------------------------------------------

6.     OPTION GRANTS

        6.1.  Employees; Service Providers; or Other Persons.

        Grants (including Grants of Incentive Stock Options, subject to
Section 7.1) may be made under the Plan to: (i) any employee, officer or
director of, or other Service Provider providing, or who has provided, services
to, the Company or any affiliate, including any such employee who is an officer
or director of the Company or of any affiliate, as the Board shall determine and
designate from time to time; or (ii) any other individual whose participation in
the Plan is determined to be in the best interests of the Company by the Board.

        6.2.  Successive Grants.

        An eligible person may receive more than one Grant, subject to such
restrictions as are provided herein.

7.     LIMITATIONS ON GRANTS

        7.1.  Limitations on Incentive Stock Options.

        An Option shall constitute an Incentive Stock Option only (i) if the
Grantee of such Option is an employee of the Company or any Subsidiary of the
Company; (ii) to the extent specifically provided in the related Award
Agreement; and (iii) to the extent that the aggregate Fair Market Value
(determined at the time the Option is granted) of the shares of Stock with
respect to which all Incentive Stock Options held by such Grantee become
exercisable for the first time during any calendar year (under the Plan and all
other plans of the Grantee's employer and its affiliates) does not exceed
$100,000. This limitation shall be applied by taking Options into account in the
order in which they were granted.

        7.2.  Limitation on Shares of Stock Subject to Grants.

        During any time when the Company has a class of equity security
registered under Section 12 of the Exchange Act, the maximum number of shares of
Stock subject to Options that can be awarded under the Plan to any person
eligible for a Grant under Section 6 hereof is FORTY THOUSAND (40,000) per year.

8.     AWARD AGREEMENT

        Each Grant pursuant to the Plan shall be evidenced by an Award
Agreement, in such form or forms as the Board shall from time to time determine.
Award Agreements granted from time to time or at the same time need not contain
similar provisions but shall be consistent with the terms of the Plan. Each
Award Agreement evidencing a Grant of Options shall specify whether such Options
are intended to be non-qualified stock options or Incentive Stock Options, and
in the absence of such specification such options shall be deemed non-qualified
stock options.

9.     OPTION PRICE

        The Option Price of each Option shall be fixed by the Board and stated
in the Award Agreement evidencing such Option. In the case of an Incentive Stock
Option the Option Price shall be not less than the Fair Market Value on the
Grant Date of a share of Stock; provided, however, that in the event that a
Grantee would otherwise be ineligible to receive an Incentive Stock Option by
reason of the provisions of Sections 422(b)(6) and 424(d) of the Code (relating
to ownership of more than ten percent of the Company's outstanding shares of
Stock), the Option Price of an Option granted to such Grantee that is intended
to be an Incentive Stock Option shall be not less than the greater of the par
value or 110 percent of the Fair Market Value of a share of Stock on the Grant
Date. In no case shall the Option Price of any Option be less than the par value
of a share of Stock.

5

--------------------------------------------------------------------------------

10.   VESTING, TERM AND EXERCISE OF OPTIONS

        10.1.   Vesting and Option Period.

        Subject to Sections 10.2 and 18.3 hereof, each Option granted under the
Plan shall become exercisable at such times and under such conditions as shall
be determined by the Board and stated in the Award Agreement. For purposes of
this Section 10.1, fractional numbers of shares of Stock subject to an Option
shall be rounded down to the next nearest whole number. The period during which
any Option shall be exercisable shall constitute the "Option Period" with
respect to such Option.

        10.2.   Term.

        Each Option granted under the Plan shall terminate, and all rights to
purchase shares of Stock thereunder shall cease, upon the expiration of ten
years from the date such Option is granted, or under such circumstances and on
such date prior thereto as is set forth in the Plan or as may be fixed by the
Board and stated in the Award Agreement relating to such Option; provided,
however, that in the event that the Grantee would otherwise be ineligible to
receive an Incentive Stock Option by reason of the provisions of
Sections 422(b)(6) and 424(d) of the Code (relating to ownership of more than
ten percent of the outstanding shares of Stock), an Option granted to such
Grantee that is intended to be an Incentive Stock Option shall not be
exercisable after the expiration of five years from its Grant Date.

        10.3.   Acceleration.

        Any limitation on the exercise of an Option contained in any Award
Agreement may be rescinded, modified or waived by the Board, in its sole
discretion, at any time and from time to time after the Grant Date of such
Option, so as to accelerate the time at which the Option may be exercised.
Notwithstanding any other provision of the Plan, no Option shall be exercisable
in whole or in part prior to the date the Plan is approved by the shareholders
of the Company as provided in Section 5.1 hereof.

        10.4.   Termination of Employment or Other Relationship.

        Unless otherwise provided by the Board, upon the termination of a
Grantee's employment or other relationship with the Company or any affiliate
other than by reason of death or "permanent and total disability" (within the
meaning of Section 22(e)(3) of the Code), any Option or portion thereof held by
such Grantee that has not vested in accordance with the provisions of
Section 10.1 hereof shall terminate immediately, and any Option or portion
thereof that has vested in accordance with the provisions of Section 10.1 hereof
but has not been exercised shall terminate at the close of business on the 90th
day following the Grantee's termination of employment or other relationship (or,
if such 90th day is a Saturday, Sunday or holiday, at the close of business on
the next preceding day that is not a Saturday, Sunday or holiday). Upon
termination of an Option or portion thereof, the Grantee shall have no further
right to purchase shares of Stock pursuant to such Option or portion thereof.
Whether a termination of employment or other relationship shall have occurred
for purposes of the Plan shall be determined by the Board, which determination
shall be final and conclusive. For purposes of the Plan, a termination of
employment, service or other relationship shall not be deemed to occur if the
Grantee is immediately thereafter a director of the Company or an affiliate.

        10.5.   Rights in the Event of Death.

        Unless otherwise provided by the Board, if a Grantee dies while employed
by or providing services to the Company, any Option or portion thereof held by
such Grantee that has not vested in accordance with the provisions of
Section 10.1 hereof shall terminate, and the executors or administrators or
legatees or distributees of such Grantee's estate shall have the right, at any
time within one year after the date of such Grantee's death and prior to
termination of the Option pursuant to Section 10.2 above, to exercise any Option
or portion thereof that has vested as of the date of such Grantee's death.

6

--------------------------------------------------------------------------------

        10.6.   Rights in the Event of Disability.

        Unless otherwise provided by the Board, if a Grantee's employment or
other relationship with the Company or an affiliate is terminated by reason of
the "permanent and total disability" (within the meaning of Section 22(e)(3) of
the Code) of such Grantee, any Option or portion thereof held by such Grantee
that has not vested in accordance with the provisions of Section 10.1 hereof
shall terminate, and the Grantee shall have the right, at any time within one
year after the date of such Grantee's permanent and total disability and prior
to termination of the Option pursuant to Section 10.2 above, to exercise any
Option or portion thereof that has vested as of the date of such Grantee's
termination. Whether a termination of employment or service is to be considered
by reason of "permanent and total disability" for purposes of the Plan shall be
determined by the Board, which determination shall be final and conclusive.

        10.7.   Limitations on Exercise of Option.

        Notwithstanding any other provision of the Plan, in no event may any
Option be exercised, in whole or in part, prior to the date the Plan is approved
by the shareholders of the Company as provided herein, or after ten years
following the date upon which the Option is granted, or after the occurrence of
an event referred to in Section 18 hereof which results in termination of the
Option.

        10.8.   Method of Exercise.

        An Option that is exercisable may be exercised by the Grantee's delivery
to the Company of written notice of exercise on any business day, at the
Company's principal office, addressed to the attention of the Board. Such notice
shall specify the number of shares of Stock with respect to which the Option is
being exercised and shall be accompanied by payment in full of the Option Price
of the shares for which the Option is being exercised. The minimum number of
shares of Stock with respect to which an Option may be exercised, in whole or in
part, at any time shall be the lesser of (i) 100 shares or such lesser number
set forth in the applicable Award Agreement and (ii) the maximum number of
shares available for purchase under the Option at the time of exercise. Payment
of the Option Price for the shares purchased pursuant to the exercise of an
Option shall be made (i) in cash or in cash equivalents acceptable to the
Company; (ii) to the extent permitted by law and at the Board's discretion,
through the tender to the Company of shares of Stock, which shares, if acquired
from the Company, shall have been held for at least six months at the time of
tender and which shall be valued, for purposes of determining the extent to
which the Option Price has been paid thereby, at their Fair Market Value on the
date of exercise; (iii) to the extent permitted by law and at the Board's
discretion, through the withholding of shares of Stock otherwise issuable upon
the exercise of the Option, for purposes of determining the extent to which the
Option Price has been paid thereby, at their Fair Market Value on the date of
exercise; or (iv) to the extent permitted by law and at the Board's discretion,
by a combination of the methods described in (i), (ii) and (iii).

        From and after the time the shares of Stock become publicly traded with
the meaning of Section 13.4, payment in full of the Option Price need not
accompany the written notice of exercise provided that the notice of exercise
directs that the certificate or certificates for the shares of Stock for which
the Option is exercised be delivered to a licensed broker acceptable to the
Company as the agent for the individual exercising the Option and, at the time
such certificate or certificates are delivered, the broker tenders to the
Company cash (or cash equivalents acceptable to the Company) equal to the Option
Price for the shares of Stock purchased pursuant to the exercise of the Option
plus the amount (if any) of federal and/or other taxes which the Company may in
its judgment, be required to withhold with respect to the exercise of the
Option. An attempt to exercise any Option granted hereunder other than as set
forth above shall be invalid and of no force and effect. Unless otherwise stated
in the applicable Award Agreement, an individual holding or exercising an Option
shall have none of the rights of a shareholder (for example, the right to
receive cash or dividend payments or distributions attributable to the subject
shares of Stock or to direct the voting of the subject shares of Stock) until

7

--------------------------------------------------------------------------------

the shares of Stock covered thereby are fully paid and issued to such
individual. Except as provided in Section 18 hereof, no adjustment shall be made
for dividends, distributions or other rights for which the record date is prior
to the date of such issuance.

        10.9.   Delivery of Stock Certificates.

        Promptly after the exercise of an Option by a Grantee and the payment in
full of the Option Price, such Grantee shall be entitled to the issuance of a
stock certificate or certificates evidencing such Grantee's ownership of the
shares of Stock subject to the Option.

11.   TRANSFERABILITY OF OPTIONs

        11.1.   Transferability of Options.

        Except as provided in Section 11.2, during the lifetime of a Grantee,
only the Grantee (or, in the event of legal incapacity or incompetency, the
Grantee's guardian or legal representative) may exercise an Option. Except as
provided in Section 11.2, no Option shall be assignable or transferable by the
Grantee to whom it is granted, other than by will or the laws of descent and
distribution.

        11.2.   Transfers.

        11.2.1. Family Transfers.

        If authorized in the applicable Award Agreement, a Grantee may transfer,
not for value, all or part of an Option which is not an Incentive Stock Option
to any Family Member. For the purpose of this Section 11.2, a "not for value"
transfer is a transfer which is (i) a gift, (ii) a transfer under a domestic
relations order in settlement of marital property rights; or (iii) a transfer to
an entity in which more than fifty percent of the voting interests are owned by
Family Members (or the Grantee) in exchange for an interest in that entity.
Following a transfer under this Section 11.2, any such Option shall continue to
be subject to the same terms and conditions as were applicable immediately prior
to transfer. Subsequent transfers of transferred Options are prohibited except
to Family Members of the original Grantee in accordance with this Section 11.2
or by will or the laws of descent and distribution. The events of termination of
employment or other relationship of Section 10.4 hereof shall continue to be
applied with respect to the original Grantee, following which the Option shall
be exercisable by the transferee only to the extent, and for the periods
specified in Sections 10.4, 10.5, or 10.6.

        11.2.2. Company Approved Transfers.

        If authorized in the applicable Award Agreement, a Grantee may transfer
all or part of an option which is not an Incentive Stock Option to any employee
or co-worker of such Grantee after written approval of the Board.

12.   RESTRICTED STOCK AND RESTRICTED STOCK UNITS

        12.1.   Grant of Restricted Stock or Restricted Stock Units.

        The Board may from time to time grant Restricted Stock or Restricted
Stock Units to persons eligible to receive Grants under Section 6 hereof,
subject to such restrictions, conditions and other terms as the Board may
determine.

        12.2.   Restrictions.

        At the time a Grant of Restricted Stock or Restricted Stock Units is
made, the Board shall establish a period of time (the "Restricted Period")
applicable to such Restricted Stock or Restricted Stock Units. Each Grant of
Restricted Stock or Restricted Stock Units may be subject to a different
Restricted Period. The Board may, in its sole discretion, at the time a Grant of
Restricted Stock or

8

--------------------------------------------------------------------------------

Restricted Stock Units is made, prescribe restrictions in addition to or other
than the expiration of the Restricted Period, including the satisfaction of
corporate or individual performance objectives, which may be applicable to all
or any portion of the Restricted Stock or Restricted Stock Units. Such
performance objectives shall be established in writing by the Board prior to the
ninetieth day of the year in which the Grant is made and while the outcome is
substantially uncertain. Performance objectives shall be based on a number of
factors including, but not limited to, Stock price, market share, sales,
earnings per share, return on equity or costs. Performance objectives may
include positive results, maintaining the status quo or limiting economic
losses. Subject to the fourth sentence of this Section 12.2, the Board also may,
in its sole discretion, shorten or terminate the Restricted Period or waive any
other restrictions applicable to all or a portion of the Restricted Stock or
Restricted Stock Units. Neither Restricted Stock nor Restricted Stock Units may
be sold, transferred, assigned, pledged or otherwise encumbered or disposed of
during the Restricted Period or prior to the satisfaction of any other
restrictions prescribed by the Board with respect to such Restricted Stock or
Restricted Stock Units.

        12.3.   Restricted Stock Certificates.

        The Company shall issue, in the name of each Grantee to whom Restricted
Stock has been granted, stock certificates representing the total number of
shares of Restricted Stock granted to the Grantee, as soon as reasonably
practicable after the Grant Date. The Board may provide in an Award Agreement
that either (i) the Secretary of the Company shall hold such certificates for
the Grantees benefit until such time as the Restricted Stock is forfeited to the
Company, or the restrictions lapse, or (ii) such certificates shall be delivered
to the Grantee, provided, however, that such certificates shall bear a legend or
legends that complies with the applicable securities laws and regulations and
makes appropriate reference to the restrictions imposed under the Plan and the
Award Agreement.

        12.4.   Rights of Holders of Restricted Stock.

        Unless the Board otherwise provides in an Award Agreement, holders of
Restricted Stock shall have the right to vote such Stock and the right to
receive any dividends declared or paid with respect to such Stock. The Board may
provide that any dividends paid on Restricted Stock must be reinvested in shares
of Stock, which may or may not be subject to the same vesting conditions and
restrictions applicable to such Restricted Stock. All distributions, if any,
received by a Grantee with respect to Restricted Stock as a result of any stock
split, stock dividend, combination of shares, or other similar transaction shall
be subject to the restrictions applicable to the original Grant.

        12.5.   Rights of Holders of Restricted Stock Units.

        Unless the Board otherwise provides in an Award Agreement, holders of
Restricted Stock Units shall have no rights as stockholders of the Company. The
Board may provide in an Award Agreement evidencing a Grant of Restricted Stock
Units that the holder of such Restricted Stock Units shall be entitled to
receive, upon the Company's payment of a cash dividend on its outstanding Stock,
a cash payment for each Restricted Stock Unit held equal to the per-share
dividend paid on the Stock. Such Award Agreement may also provide that such cash
payment will be deemed reinvested in additional Restricted Stock Units at a
price per unit equal to the Fair Market Value of a share of Stock on the date
that such dividend is paid.

        12.6.   Termination of Employment or Other Relationship.

        Unless otherwise provided by the Board, upon the termination of a
Grantee's employment or other relationship with the Company or an affiliate
other than by reason of death or "permanent and total disability" (within the
meaning of Section 22(e)(3) of the Code), any shares of Restricted Stock or
Restricted Stock Units held by such Grantee that have not vested, or with
respect to which all applicable restrictions and conditions have not lapsed,
shall immediately be deemed forfeited. Upon forfeiture of Restricted Stock or
Restricted Stock Units, the Grantee shall have no further rights with

9

--------------------------------------------------------------------------------

respect to such Grant, including but not limited to any right to vote Restricted
Stock or any right to receive dividends with respect to shares of Restricted
Stock or Restricted Stock Units. Whether a termination of employment or other
relationship shall have occurred for purposes of the Plan shall be determined by
the Board, which determination shall be final and conclusive. For purposes of
the Plan, a termination of employment, service or other relationship shall not
be deemed to occur if the Grantee is immediately thereafter a director of the
Company or an affiliate.

        12.7.   Rights in the Event of Death.

        Unless otherwise provided by the Board, if a Grantee dies while employed
by the Company or an affiliate, all Restricted Stock or Restricted Stock Units
granted to such Grantee shall fully vest on the date of death, and the shares of
Stock represented thereby shall be deliverable in accordance with the terms of
the Plan to the executors, administrators, legatees or distributees of the
Grantee's estate.

        12.8.   Rights in the Event of Disability.

        Unless otherwise provided by the Board, if a Grantee's employment or
other relationship with the Company or an affiliate is terminated by reason of
the "permanent and total disability" (within the meaning of Section 22(e)(3) of
the Code) of such Grantee, such Grantee's Restricted Stock or Restricted Stock
Units shall continue to vest in accordance with the applicable Award Agreement
for a period of one year after such termination of employment or service,
subject to the earlier forfeiture of such Restricted Stock or Restricted Stock
Units in accordance with the terms of the applicable Award Agreement. Whether a
termination of employment or service is to be considered by reason of "permanent
and total disability" for purposes of the Plan shall be determined by the Board,
which determination shall be final and conclusive.

        12.9.   Delivery of Stock and Payment Therefor.

        Upon the expiration or termination of the Restricted Period and the
satisfaction of any other conditions prescribed by the Board, the restrictions
applicable to shares of Restricted Stock or Restricted Stock Units shall lapse,
and, unless otherwise provided in the Award Agreement, upon payment by the
Grantee to the Company, in cash or by check, of the greater of (i) the aggregate
par value of the shares of Stock represented by such Restricted Stock or
Restricted Stock Units or (ii) the purchase price, if any, specified in the
Award agreement relating to such Restricted Stock or Restricted Stock Units, a
stock certificate for such shares shall be delivered, free of all such
restrictions, to the Grantee or the Grantee's beneficiary or estate, as the case
may be.

13.   NONTRANSFERABILITY OF SHARES; REPURCHASE RIGHTS

        13.1.   Nontransferability of Shares.

        Subject to Section 13.4 below, a Grantee (or such other individual who
is entitled to exercise an Option or otherwise acquire shares pursuant to a
Grant) shall not sell, pledge, assign, gift, transfer, or otherwise dispose of
any shares of Stock acquired pursuant to a Grant to any person or entity without
first offering such shares to the Company for purchase on the same terms and
conditions as those offered the proposed transferee. The Company may assign its
right of first refusal under this Section 13 in whole or in part, to (1) any
holder of stock or other securities of the Company (a "Stockholder"), (2) any
affiliate or (3) any other person or entity that the Board of Directors of the
Company determines has a sufficient relationship with or interest in the
Company. The Company shall give reasonable written notice to the Grantee of any
such assignment of its rights. The restrictions of this Section 13.1 apply to
any person to whom Stock that was originally acquired pursuant to a Grant is
sold, pledged, assigned, bequeathed, gifted, transferred or otherwise disposed
of, without regard to the number of such subsequent transferees or the manner in
which they acquire the Stock, but the restrictions of this Section 13.1 do not
apply to a transfer of Stock that occurs as a result of the death of the Grantee
or of any subsequent transferee (but shall apply to the executor, the
administrator or personal representative, the estate, and the legatees,
beneficiaries and assigns thereof).

10

--------------------------------------------------------------------------------

        13.2.   Repurchase Rights.

        Unless otherwise provided in the applicable Award Agreement, subject to
Section 13.4 below, upon the termination of a Grantee's employment or other
relationship with the Company or an affiliate, the Company shall have the right,
for a period of up to twelve months following such termination, to repurchase
any or all of the shares of Stock acquired by the individual pursuant to this
Plan under a Grant (including shares of Stock that were previously transferred
pursuant to Sections 11.1, 11.2 or 13.1 above), at a price equal to the Fair
Market Value of such shares of Stock on the date of termination. Upon the
exercise of an Option following termination of a Grantee's employment or other
relationship with the Company or an affiliate, the Company shall have the right,
for a period of up to twelve months following such exercise, to repurchase any
or all such shares of Stock acquired by the Grantee pursuant to such exercise of
such Option at a price that is equal to the Fair Market Value of such shares
(including shares that were previously transferred pursuant to Sections 11.1,
11.2 or 13.1 above) on the date of exercise (or at such other price or the Fair
Market Value on such other date as shall have been specified by the Board at the
time of grant and set out in the appropriate Award Agreement with respect to the
grant). In the event that the Company determines that it cannot or will not
exercise its rights to purchase Stock under this Section 13.2 and the applicable
Award Agreement, in whole or in part, the Company may assign its rights, in
whole or in part, to (1) any Stockholder (2) any affiliate or (3) any other
person or entity that the Board of Directors of the Company determines has a
sufficient relationship with or interest in the Company. The Company shall give
reasonable written notice to the individual of any assignment of its rights.

        13.3.   Installment Payments.

        In the case of any purchase of Stock or an Option under this Section 13,
the Company or its permitted assignee may pay the Grantee, transferee of the
Option or other registered owner of the Stock the purchase price in three or
fewer annual installments. Interest shall be credited on the installments at the
applicable federal rate (as determined for purposes of Section 1274 of the Code)
in effect on the date on which the purchase is made. The Company or its
permitted assignee shall pay at least one-third of the total purchase price each
year, plus interest on the unpaid balance, with the first payment being made on
or before the 60th day after the purchase.

        13.4.   Publicly Traded Stock.

        If the Stock is listed on an established national or regional stock
exchange or is admitted to quotation on the National Association of Securities
Dealers Automated Quotation System, or is publicly traded in an established
securities market, the foregoing transfer restrictions of Sections 13.1 and 13.2
shall terminate as of the first date that the Stock is so listed, quoted or
publicly traded.

        13.5.   Legend.

        In order to enforce the restrictions imposed upon shares of Stock under
this Plan or as provided in an Award Agreement, the Board may cause a legend or
legends to be placed on any certificate representing shares issued pursuant to
this Plan that complies with the applicable securities laws and regulations and
makes appropriate reference to the restrictions imposed under it.

14.   CERTAIN PROVISIONS APPLICABLE TO AWARDS

        14.1.   Stand-Alone, Additional, Tandem, and Substitute Grants.

        Grants under the Plan may, in the discretion of the Board, be granted
either alone or in addition to, in tandem with, or in substitution or exchange
for, any other Grant or any award granted under another plan of the Company, any
affiliate, or any business entity to be acquired by the Company or an affiliate,
or any other right of a Grantee to receive payment from the Company or any
affiliate. Such additional, tandem, and substitute or exchange Grants may be
awarded at any time. If a Grant is

11

--------------------------------------------------------------------------------

awarded in substitution or exchange for another Grant, the Board shall require
the surrender of such other Grant in consideration for the new Grant. In
addition, Grants may be made in lieu of cash compensation, including in lieu of
cash amounts payable under other plans of the Company or any affiliate, in which
the value of Stock subject to the Grant is equivalent in value to the cash
compensation (for example, Restricted Stock), or in which the exercise price,
grant price or purchase price of the Grant in the nature of a right that may be
exercised is equal to the Fair Market Value of the underlying Stock minus the
value of the cash compensation surrendered (for example, Options granted with an
exercise price "discounted" by the amount of the cash compensation surrendered).

        14.2.   Term of Grant.

        The term of each Grant shall be for such period as may be determined by
the Board; provided that in no event shall the term of any Option exceed a
period of ten years (or such shorter term as may be required in respect of an
Incentive Stock Option under Section 422 of the Code).

        14.3.   Form and Timing of Payment Under Grants; Deferrals.

        Subject to the terms of the Plan and any applicable Award Agreement,
payments to be made by the Company or an affiliate upon the exercise of an
Option or other Grant may be made in such forms as the Board shall determine,
including, without limitation, cash, Stock, other Grants or other property, and
may be made in a single payment or transfer, in installments, or on a deferred
basis. The settlement of any Grant may be accelerated, and cash paid in lieu of
Stock in connection with such settlement, in the discretion of the Board or upon
occurrence of one or more specified events. Installment or deferred payments may
be required by the Board or permitted at the election of the Grantee on terms
and conditions established by the Board. Payments may include, without
limitation, provisions for the payment or crediting of a reasonable interest
rate on installment or deferred payments or the grant or crediting of dividend
equivalents or other amounts in respect of installment or deferred payments
denominated in Stock.

15.   PARACHUTE LIMITATIONS

        Notwithstanding any other provision of this Plan or of any other
agreement, contract, or understanding heretofore or hereafter entered into by a
Grantee with the Company or any affiliate, except an agreement, contract, or
understanding hereafter entered into that expressly modifies or excludes
application of this paragraph (an "Other Agreement"), and notwithstanding any
formal or informal plan or other arrangement for the direct or indirect
provision of compensation to the Grantee (including groups or classes of
participants or beneficiaries of which the Grantee is a member), whether or not
such compensation is deferred, is in cash, or is in the form of a benefit to or
for the Grantee (a "Benefit Arrangement"), if the Grantee is a "disqualified
individual," as defined in Section 280G(c) of the Code, any Option, Restricted
Stock or Restricted Stock Unit held by that Grantee and any right to receive any
payment or other benefit under this Plan shall not become exercisable or vested
(i) to the extent that such right to exercise, vesting, payment, or benefit,
taking into account all other rights, payments, or benefits to or for the
Grantee under this Plan, all Other Agreements, and all Benefit Arrangements,
would cause any payment or benefit to the Grantee under this Plan to be
considered a "parachute payment" within the meaning of Section 280G(b)(2) of the
Code as then in effect (a "Parachute Payment") and (ii) if, as a result of
receiving a Parachute Payment, the aggregate after-tax amounts received by the
Grantee from the Company under this Plan, all Other Agreements, and all Benefit
Arrangements would be less than the maximum after-tax amount that could be
received by the Grantee without causing any such payment or benefit to be
considered a Parachute Payment. In the event that the receipt of any such right
to exercise, vesting, payment, or benefit under this Plan, in conjunction with
all other rights, payments, or benefits to or for the Grantee under any Other
Agreement or any Benefit Arrangement would cause the Grantee to be considered to
have received a Parachute Payment under this Plan that would have the effect of
decreasing the after-tax amount

12

--------------------------------------------------------------------------------

received by the Grantee as described in clause (ii) of the preceding sentence,
then the Grantee shall have the right, in the Grantee's sole discretion, to
designate those rights, payments, or benefits under this Plan, any Other
Agreements, and any Benefit Arrangements that should be reduced or eliminated so
as to avoid having the payment or benefit to the Grantee under this Plan be
deemed to be a Parachute Payment.

16.   REQUIREMENTS OF LAW

        16.1.   General.

        The Company shall not be required to sell or issue any shares of Stock
under any Grant if the sale or issuance of such shares would constitute a
violation by the Grantee, any other individual exercising a right emanating from
such Grant, or the Company of any provision of any law or regulation of any
governmental authority, including without limitation any federal or state
securities laws or regulations. If at any time the Company shall determine, in
its discretion, that the listing, registration or qualification of any shares
subject to a Grant upon any securities exchange or under any governmental
regulatory body is necessary or desirable as a condition of, or in connection
with, the issuance or purchase of shares hereunder, no shares of Stock may be
issued or sold to the Grantee or any other individual exercising an Option
pursuant to such Grant unless such listing, registration, qualification, consent
or approval shall have been effected or obtained free of any conditions not
acceptable to the Company, and any delay caused thereby shall in no way affect
the date of termination of the Grant. Specifically, in connection with the
Securities Act, upon the exercise of any right emanating from such Grant or the
delivery of any shares of Restricted Stock or Stock underlying Restricted Stock
Units, unless a registration statement under such Act is in effect with respect
to the shares of Stock covered by such Grant, the Company shall not be required
to sell or issue such shares unless the Board has received evidence satisfactory
to it that the Grantee or any other individual exercising an Option may acquire
such shares pursuant to an exemption from registration under the Securities Act.
Any determination in this connection by the Board shall be final, binding, and
conclusive. The Company may, but shall in no event be obligated to, register any
securities covered hereby pursuant to the Securities Act. The Company shall not
be obligated to take any affirmative action in order to cause the exercise of an
Option or the issuance of shares of Stock pursuant to the Plan to comply with
any law or regulation of any governmental authority. As to any jurisdiction that
expressly imposes the requirement that an Option shall not be exercisable until
the shares of Stock covered by such Option are registered or are exempt from
registration, the exercise of such Option (under circumstances in which the laws
of such jurisdiction apply) shall be deemed conditioned upon the effectiveness
of such registration or the availability of such an exemption.

        16.2.   Rule 16b-3.

        During any time when the Company has a class of equity security
registered under Section 12 of the Exchange Act, it is the intent of the Company
that Grants pursuant to the Plan and the exercise of Options granted hereunder
will qualify for the exemption provided by Rule 16b-3 under the Exchange Act. To
the extent that any provision of the Plan or action by the Board does not comply
with the requirements of Rule 16b-3, it shall be deemed inoperative to the
extent permitted by law and deemed advisable by the Board, and shall not affect
the validity of the Plan. In the event that Rule 16b-3 is revised or replaced,
the Board may exercise its discretion to modify this Plan in any respect
necessary to satisfy the requirements of, or to take advantage of any features
of, the revised exemption or its replacement.

17.   AMENDMENT AND TERMINATION OF THE PLAN

        The Board may, at any time and from time to time, amend, suspend, or
terminate the Plan as to any shares of Stock as to which Grants have not been
made; provided, however, that the Board shall

13

--------------------------------------------------------------------------------

not, without approval of the Company's shareholders, amend the Plan such that it
does not comply with the Code. Except as permitted under this Section 17 or
Section 18 hereof, no amendment, suspension, or termination of the Plan shall,
without the consent of the Grantee, alter or impair rights or obligations under
any Grant theretofore awarded under the Plan.

18.   EFFECT OF CHANGES IN CAPITALIZATION

        18.1.   Changes in Stock.

        If the number of outstanding shares of Stock is increased or decreased
or the shares of Stock are changed into or exchanged for a different number or
kind of shares or other securities of the Company on account of any
recapitalization, reclassification, stock split, reverse split, combination of
shares, exchange of shares, stock dividend or other distribution payable in
capital stock, or other increase or decrease in such shares effected without
receipt of consideration by the Company occurring after the Effective Date, the
number and kinds of shares for which Grants of Options, Restricted Stock and
Restricted Stock Units may be made under the Plan shall be adjusted
proportionately and accordingly by the Company. In addition, the number and kind
of shares for which Grants are outstanding shall be adjusted proportionately and
accordingly so that the proportionate interest of the Grantee immediately
following such event shall, to the extent practicable, be the same as
immediately before such event. Any such adjustment in outstanding Options shall
not change the aggregate Option Price payable with respect to shares that are
subject to the unexercised portion of an Option outstanding but shall include a
corresponding proportionate adjustment in the Option Price per share. The
conversion of any convertible securities of the Company shall not be treated as
an increase in shares effected without receipt of consideration.

        18.2.   Reorganization in Which the Company Is the Surviving Entity and
in Which No Change of Control Occurs.

        Subject to Section 18.3 hereof, if the Company shall be the surviving
entity in any reorganization, merger, or consolidation of the Company with one
or more other entities and in which no Change of Control occurs, any Option
theretofore granted pursuant to the Plan shall pertain to and apply to the
securities to which a holder of the number of shares of Stock subject to such
Option would have been entitled immediately following such reorganization,
merger, or consolidation, with a corresponding proportionate adjustment of the
Option Price per share so that the aggregate Option Price thereafter shall be
the same as the aggregate Option Price of the shares remaining subject to the
Option immediately prior to such reorganization, merger, or consolidation.
Subject to any contrary language in an Award Agreement evidencing a Grant of
Restricted Stock, any restrictions applicable to such Restricted Stock shall
apply as well to any replacement shares received by the Grantee as a result of
the reorganization, merger or consolidation.

        18.3.   Reorganization, Sale of Assets or Sale of Stock Which Involves a
Change of Control.

        Subject to the exceptions set forth in the last sentence of this
Section 18.3, (i) upon the occurrence of a Change of Control, all outstanding
shares of Restricted Stock and Restricted Stock Units shall be deemed to have
vested, and all restrictions and conditions applicable to such shares of
Restricted Stock and Restricted Stock Units shall be deemed to have lapsed,
immediately prior to the occurrence of such Change of Control, and
(ii) fifteen days prior to the scheduled consummation of a Change of Control,
all Options outstanding hereunder shall become immediately exercisable and shall
remain exercisable for a period of fifteen days. Any exercise of an Option
during such fifteen-day period shall be conditioned upon the consummation of the
event and shall be effective only immediately before the consummation of the
event. Upon consummation of any Change of Control, the Plan and all outstanding
but unexercised Options shall terminate. The Board shall send written notice of
an event that will result in such a termination to all individuals who hold
Options not later than the time at which the Company gives notice thereof to its
shareholders. This Section 18.3 shall not apply to any

14

--------------------------------------------------------------------------------

Change of Control to the extent that (A) provision is made in writing in
connection with such Change of Control for the assumption of the Options,
Restricted Stock and Restricted Stock Units theretofore granted, or for the
substitution for such Options, Restricted Stock and Restricted Stock Units of
new options, restricted stock and restricted stock units covering the stock of a
successor entity, or a parent or subsidiary thereof, with appropriate
adjustments as to the number and kinds of shares or units and exercise prices,
in which event the Plan and Options, Restricted Stock and Restricted Stock Units
theretofore granted shall continue in the manner and under the terms so provided
or (B) a majority of the full Board determines that such Change of Control shall
not trigger application of the provisions of this Section 18.3, subject to
Section 26.

        18.4.   Adjustments.

        Adjustments under this Section 18 related to shares of Stock or
securities of the Company shall be made by the Board, whose determination in
that respect shall be final, binding and conclusive. No fractional shares or
other securities shall be issued pursuant to any such adjustment, and any
fractions resulting from any such adjustment shall be eliminated in each case by
rounding downward to the nearest whole share.

        18.5.   No Limitations on Company.

        The making of Grants pursuant to the Plan shall not affect or limit in
any way the right or power of the Company to make adjustments,
reclassifications, reorganizations, or changes of its capital or business
structure or to merge, consolidate, dissolve, or liquidate, or to sell or
transfer all or any part of its business or assets.

19.   DISCLAIMER OF RIGHTS

        No provision in the Plan or in any Grant or Award Agreement shall be
construed to confer upon any individual the right to remain in the employ or
service of the Company or any affiliate, or to interfere in any way with any
contractual or other right or authority of the Company either to increase or
decrease the compensation or other payments to any individual at any time, or to
terminate any employment or other relationship between any individual and the
Company. In addition, notwithstanding anything contained in the Plan to the
contrary, unless otherwise stated in the applicable Award Agreement, no Grant
awarded under the Plan shall be affected by any change of duties or position of
the Grantee, so long as such Grantee continues to be a director, officer,
consultant or employee of the Company or any affiliate. The obligation of the
Company to pay any benefits pursuant to this Plan shall be interpreted as a
contractual obligation to pay only those amounts described herein, in the manner
and under the conditions prescribed herein. The Plan shall in no way be
interpreted to require the Company to transfer any amounts to a third party
trustee or otherwise hold any amounts in trust or escrow for payment to any
participant or beneficiary under the terms of the Plan. No Grantee shall have
any of the rights of a shareholder with respect to the shares of Stock subject
to an Option except to the extent the certificates for such shares of Stock
shall have been issued upon the exercise of the Option.

20.   NONEXCLUSIVITY OF THE PLAN

        Neither the adoption of the Plan nor the submission of the Plan to the
shareholders of the Company for approval shall be construed as creating any
limitations upon the right and authority of the Board to adopt such other
incentive compensation arrangements (which arrangements may be applicable either
generally to a class or classes of individuals or specifically to a particular
individual or particular individuals) as the Board in its discretion determines
desirable, including, without limitation, the granting of stock options
otherwise than under the Plan.

15

--------------------------------------------------------------------------------

21.   WITHHOLDING TAXES

        The Company or any affiliate, as the case may be, shall have the right
to deduct from payments of any kind otherwise due to a Grantee any Federal,
state, or local taxes of any kind required by law to be withheld with respect to
the vesting of or other lapse of restrictions applicable to Restricted Stock or
Restricted Stock Units or upon the issuance of any shares of Stock upon the
exercise of an Option. At the time of such vesting, lapse, or exercise, the
Grantee shall pay to the Company or affiliate, as the case may be, any amount
that the Company or affiliate may reasonably determine to be necessary to
satisfy such withholding obligation. Subject to the prior approval of the
Company or the affiliate, which may be withheld by the Company or the affiliate,
as the case may be, in its sole discretion, the Grantee may elect to satisfy
such obligations, in whole or in part, (i) by causing the Company or the
affiliate to withhold shares of Stock otherwise issuable to the Grantee or
(ii) by delivering to the Company or the affiliate shares of Stock already owned
by the Grantee. The shares of Stock so delivered or withheld shall have an
aggregate Fair Market Value equal to such withholding obligations. The Fair
Market Value of the shares of Stock used to satisfy such withholding obligation
shall be determined by the Company or the affiliate as of the date that the
amount of tax to be withheld is to be determined. A Grantee who has made an
election pursuant to this Section 21 may satisfy his or her withholding
obligation only with shares of Stock that are not subject to any repurchase,
forfeiture, unfulfilled vesting, or other similar requirements.

22.   CAPTIONS

        The use of captions in this Plan or any Award Agreement is for the
convenience of reference only and shall not affect the meaning of any provision
of the Plan or such Award Agreement.

23.   OTHER PROVISIONS

        Each Grant awarded under the Plan may contain such other terms and
conditions not inconsistent with the Plan as may be determined by the Board, in
its sole discretion.

24.   NUMBER AND GENDER

        With respect to words used in this Plan, the singular form shall include
the plural form, the masculine gender shall include the feminine gender, etc.,
as the context requires.

25.   SEVERABILITY

        If any provision of the Plan or any Award Agreement shall be determined
to be illegal or unenforceable by any court of law in any jurisdiction, the
remaining provisions hereof and thereof shall be severable and enforceable in
accordance with their terms, and all provisions shall remain enforceable in any
other jurisdiction.

26.   POOLING

        In the event any provision of the Plan or the Award Agreement would
prevent the use of pooling of interests accounting in a corporate transaction
involving the Company and such transaction is contingent upon pooling of
interests accounting, then that provision shall be deemed amended or revoked to
the extent required to preserve such pooling of interests. The Company may
require in an Award Agreement that a Grantee who receives a Grant under the Plan
shall, upon advice from the Company, take (or refrain from taking, as
appropriate) all actions necessary or desirable to ensure that pooling of
interests accounting is available.

16

--------------------------------------------------------------------------------

27.   GOVERNING LAW

        The validity and construction of this Plan and the instruments
evidencing the Grants awarded hereunder shall be governed by the laws of the
State of Colorado (excluding the choice of law rules thereof).

28.   BLUE SKY PROVISIONS

        28.1.   California Provisions.

        Notwithstanding the foregoing sections, any Grant made under the Plan to
a Grantee who is a resident of the State of California on the Grant Date shall
be subject to the following additional terms and conditions:

        A.    For the purpose of Grants which are not Incentive Stock Options,
Fair Market Value shall be determined in a manner not inconsistent with
Section 260.140.50 of the California Code of Regulations or any successor
statute, and the exercise price of any non-incentive stock option shall not be
less than 85% of Fair Market Value on the date of grant.

        B.    Grants may not be made under the Plan to Grantees ten years after
the earlier of: (i) the date the Plan was adopted by the Board or (ii) the date
the Plan was approved by the shareholders of the Company.

        C.    An Option granted under the Plan to a Grantee who is a person who
owns stock possessing more than ten percent of the combined voting power of all
classes of stock of the Company or its parent or its Subsidiary corporations
shall have an Option Price of at least 110% of the Fair Market Value of a share
of Stock on the Grant Date.

        D.    Any Option granted under the Plan to a Grantee who is not an
officer, director, or consultant of the Company or affiliates shall become
exercisable at a rate of at least twenty percent (20%) of the shares of Stock
subject to such Grant per year for a period of five years from the Grant Date;
provided, that, such Option shall be subject to such reasonable forfeiture
conditions as the Board may choose to impose and which are not inconsistent with
Section 260.140.41 of the California Code of Regulations or any successor
statute.

        E.    The Company shall deliver to the Grantee financial statements on
an annual basis regarding the Company. The financial statements so provided
shall comply with Section 260.140.46 of the California Code of Regulations or
any successor statute, but need not comply with Section 260.613 of the
California Code of Regulations or any successor statute.

        F.     Any transfer of an Option granted under the Plan authorized by
the Board in an Award Agreement must comply with Section 260.140.41(d) of the
California Code of Regulations or any successor statute.

        G.    A Grant which authorizes a Grantee to purchase Stock under the
Plan (other than a non-qualified stock option) shall not be transferable other
than by will or the laws of descent and distribution.

        H.    Unless a Grantee's employment is terminated for cause as defined
by applicable law, the Grantee shall have the right to exercise an Option, prior
to the termination of the Option in accordance with Section 10 and only to the
extent that the Grantee was entitled to exercise such Option on the date
employment terminates, as follows: (i) at least six (6) months after the date of
termination if the termination was caused by the Grantee's death or "permanent
and total disability" (within the meaning of Section 22(e)(3) of the Code), and
(ii) at least thirty (30) days after the date of termination if termination was
caused by other than death or "permanent and total disability" (within the
meaning of Section 22(e)(3) of the Code) of the Grantee.

17

--------------------------------------------------------------------------------

        I.     The purchase price for a grant of Restricted Stock or Restricted
Stock Units shall be at least 85% of the Fair Market Value of the Stock on the
Grant Date and at least 100% of the Fair Market Value of Stock on the Grant Date
in the case of a person who owns stock possessing more than ten percent of the
combined voting power of all classes of stock of the Company or its parent or
its Subsidiary corporations.

        J.     At no time shall the total number of shares of Stock issuable
upon exercise of all outstanding Options and the total number of shares provided
for under all stock bonus or similar plans of the Company exceed the applicable
percentage as calculated in accordance with the conditions and exclusions of
Section 260.140.45 of the California Code of Regulations or any successor
statute.

        K.    Grants may be made only to persons who are employees, directors,
or consultants of the Company or its affiliates.

        If the Stock is listed on an established national or regional stock
exchange or is admitted to quotation on the National Association of Securities
Dealers Automated Quotation System, or is publicly traded in an established
securities market, the restrictions of this Section 28.1 shall terminate as of
the first date that the Stock is so listed, quoted or publicly traded.

        28.2.   Limitations on Grants to Non-Employees.

        Notwithstanding Section 6, to the extent required to comply with
restrictions in state laws, including laws regulating the sale or issuance of
securities, a person: who is not an employee of the Company or an employee of
any wholly-owned subsidiary of the Company shall not be eligible to receive a
Grant under the Plan. Grants may be made to such individuals under another plan
of the Company.

* * *

        The Plan was duly adopted and approved by the Board of Directors of the
Company as of the 3rd day of February, 2000.

        The Plan was duly approved by the stockholders of the Company on the
31st day of January, 2001.

18

--------------------------------------------------------------------------------

QuickLinks

MDMI HOLDINGS, INC. 2000 STOCK OPTION AND INCENTIVE PLAN