**Exhibit10.41**

 

**VITAL IMAGES, INC.NON-STATUTORY STOCK OPTION AGREEMENT**

 
| **OPTIONEE:**                | Jay Miller      |
|------------------------------|-----------------|
|                         |            |
| **GRANT DATE:**              | March 12, 2002  |
|                         |            |
| **NUMBER OF OPTION SHARES:** | 165,000 Shares  |
|                         |            |
| **OPTION PRICE PER SHARE:**  | $7.25 per Share |
|                         |            |
| **EXPIRATION DATE:**         | March 12, 2010  |

 

**THIS AGREEMENT** is made as of the Grant Dateset forth above, by and between Vital Images, Inc., a Minnesota corporation(the “Company”), and the Optionee named above, who is an employee of theCompany or a subsidiary of the Company (the “Optionee”).

 

The Company desires, by affording the Optionee anopportunity to purchase shares of its Common Stock, as hereinafter provided, toinduce the Optionee to continue performing services for the Company.

 

**NOW, THEREFORE,** in consideration of themutual cove­nants hereinafter set forth and for other good and valuableconsideration, the parties hereby agree as follows:

 

**1.****                                      Grantof Option.**  The Company herebygrants to the Optionee the right and option to purchase all or any part of theaggregate number of shares of Common Stock set forth above (the “OptionShares”) (such number being subject to adjustment as provided in paragraph 8hereof) on the terms and subject to the conditions set forth in thisAgreement.  **This option is not intended to be an“incentive stock option” within the meaning of section 422 of the InternalRevenue Code of 1986, as amended (the “Code”) and is being granted outside ofthe Company’s 1997 Stock Option and Incentive Plan (the “Plan”).**

 

**2.****                                      PurchasePrice.**  The purchase price of theOption Shares shall be the Option Price per share set forth above (such OptionPrice being subject to adjustment as provided in paragraph 8 hereof).

 

**3.****                                      Termand Exercise of Option.**

 

(a)                                  Theterm of this option shall commence on the Grant Date set forth above and shallcontinue until the Expiration Date set forth above, unless earlier terminatedas provided herein.

 

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(b)                                 Unlessthe Compensation Committee of the Board of Directors of the Company shalldecide otherwise, and except as otherwise provided herein, this option will beexercisable in cumulative installments as follows:

 

(i)                                     Noneof the Option Shares may be purchased prior to March 12, 2003;

 

(ii)                                  Upto 52,368 of the Option Shares may be purchased at any time after March 11,2003 and prior to termination of this option; and

 

(iii)                               Thisoption shall become exercisable as to an additional 4,000 of the Option Shares(less any shares previously purchased pursuant to this option) on the 12th dayof each successive calendar month, through December 12, 2003, following the dateset forth in paragraph 2(b)(ii) above and prior to termination of this option;

 

(iv)                              Thisoption shall become exercisable as to an additional 3,270 of the Option Shares(less any shares previously purchased pursuant to this option) on the 12th dayof each successive calendar month from January 2004 through December 2004 andprior to termination of this option;

 

(v)                                 Thisoption shall become exercisable as to an additional 2,893 of the Option Shares(less any shares previously purchased pursuant to this option) on the 12th dayof each successive calendar month from January 2005 through December 2005 andprior to termination of this option;

 

(vi)                              Thisoption shall become exercisable as to an additional 892 of the Option Shares(less any shares previously purchased pursuant to this option) on the 12th dayof each successive calendar month from January 2006 through March 2006 andprior to termination of this option;

 

(c)                                  Toexercise this option, the Optionee shall give written notice to the Company inthe form attached as Exhibit A, to the attention of its Chief Financial Officeror other designated agent, and shall deliver payment in full for the OptionShares with respect to which this option is then being exercised, as providedin paragraph 4(b) below.

 

(d)                                 Neitherthe Optionee nor the Optionee’s heirs or legal representatives, as the case maybe, will be, or will be deemed to be, a holder of any Option Shares for anypurpose unless and until certificates for such Option Shares are issued to theOptionee or the Optionee’s heirs or legal representatives under the terms ofthe Option Plan.

 

**1.****                                      Limitationson Exercise of Option.**

 

(a)                                  Exceptas provided in paragraph 6 or 7 below, this option may not be exercised unlessthe Optionee, at all times during the period beginning on the Grant Date and

 

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ending on the day three months before the date of such exercise, shallhave been continuously employed by the Company or a subsidiary of the Company.

 

(b)                                 Theexercise of this option will be contingent upon receipt from the Optionee (orthe purchaser acting under paragraph 7 below) of the full Option Price of suchOption Shares.  Subject to approval ofthe Committee administering the Option Plan, payment of the Option Price may bemade in cash, check, bank draft, money order, by tender of a broker exercisenotice or in shares of Common Stock previously owned by the Optionee for morethan six months and having an aggregate fair market value on the date ofexercise which is not less than the Option Price.

 

(c)                                  Theissuance of Option Shares upon the exercise of this option shall be subject toall applicable laws, rules, and regulations. If, in the opinion of the Compensation Committee, (i) the listing,registration, or qualification of the Option Shares under any state or federallaw, (ii) the consent or approval of any regulatory body, or (iii) anagreement of the Optionee with respect to the disposition of the Option Shares,is necessary or desirable as a condition to the issuance or sale of the OptionShares, this option shall not be exercisable unless and until such listing,registration, qualification, consent, approval or agreement is effected orobtained in form satisfactory to the Compensation Committee.

 

**2.****                                      Nontransferabilityof Option.**  This option shall not betransferable by the Optionee, other than by will or the laws of descent anddistribution.  During the lifetime ofthe Optionee, this option shall be exercis­able only by the Optionee.

 

**3.****                                      Terminationof Employment.**

 

(a)                                  Ifthe Optionee shall cease to be employed by the Company or a subsidiary of theCompany as a result of permanent and total disability (as defined by the Code),this option will become immediately exercisable in full on the date oftermination of employment and may be exercised within a period of one yearafter such termination of employment, but in no case later than the ExpirationDate set forth above.

 

(b)                                 Ifthe Optionee shall cease to be employed by the Company or a subsidiary of theCompany as a result the Optionee’s Retirement (as defined by the Option Plan),this option will become immediately exercisable in full on the date oftermination of employment and may be exercised for a period of three monthsafter such termination of employment, but in no case later than the ExpirationDate.

 

(c)                                  Ifthe Optionee shall cease to be employed by the Company or a subsidiary of theCompany for any reason other than death, permanent and total disability orretirement, this option may be exercised, to the extent the Optionee shall havebeen entitled to do so at the date of termination of employment, within aperiod of three months after such termination of employment, but in no caselater than the Expiration Date set forth above; provided, however, that ifOptionee’s employment is terminated by the Company for “cause” (as defined inthe Option Plan), this option shall immediately terminate and will notthereafter be exercisable.

 

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(d)                                 Thisoption will not confer upon the Optionee any right with respect to continuanceof employment by the Company or a subsidiary of the Company, nor will itinterfere in any way with the Company’s right or the subsidiary’s right toterminate the Optionee’s employment at any time.

 

**4.****                                      Deathof Optionee.**  In the event of thedeath of the Optionee while in the employ of the Company or a subsidiary of theCompany, this option will become exercisable in full at the date of death andmay be exercised within a period of one year after the date of death, but in nocase later than the Expiration Date set forth above.  In such event, this option shall be exercisable only by theexecutors or administrators of the Optionee or by the person or persons to whomthe Optionee’s rights under the option shall pass by the Optionee’s Will or thelaws of descent and distribu­tion.

 

**5.****                                      Merger,Consolidation, Reorganization, Liquidation; Adjustments.**  Subject to the other provisions of thisoption, in the event of any change in the outstanding shares of Common Stock byreason of any reorganization, merger, consolidation, liquidation, stockdividend or split, recapitalization, reclassification, combination, or exchangeof shares or other similar corporate change, then if the Compensation Committeeshall determine, in its sole discretion, that such change necessarily orequitably requires an adjustment in the number of Option Shares or in theOption Price Per Share in order to prevent enlargement or dilution of therights of the Optionee, such adjustments shall be made by the Committee andshall be conclusive and binding for all purposes of this option.  No adjustment shall be made in connectionwith the issuance by the Company of any warrants, rights, or options to acquireadditional Common Stock or of securities convertible into Common Stock.

 

**9.****                                      ImmediateAcceleration of Option.** Notwithstanding any provision in this option to the contrary, thisoption will become exercisable in full immediately if, subsequent to the GrantDate set forth above, any of the following events shall occur:

 

(a)                                  Thesale, lease, exchange or other transfer, directly or indirectly, ofsubstantially all of the assets of the Company (in one transaction or in aseries of related transactions) to a person or entity that is not controlled bythe Company,

 

(b)                                 Theapproval by the shareholders of the Company of any plan or proposal for theliquidation or dissolution of the Company;

 

(c)                                  Amerger or consolidation to which the Company is a party if the shareholders ofthe Company immediately prior to effective date of such merger or consolidationhave “beneficial ownership” (as defined in Rule 13d-3 under the SecuritiesExchange Act of 1934), immediately following the effective date of such mergeror consolidation, of securities of the surviving corporation representing (A)more than 50%, but not more than 80%, of the combined voting power of thesurviving corporation’s then outstanding securities ordinarily having the rightto vote at elections of directors, unless such merger or consolidation has beenapproved in advance by the Incumbent Directors (as defined below), or(B) 50% or less of the

 

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combined voting power of the surviving corporation’s then outstandingsecurities ordinarily having the right to vote at elections of directors(regardless of any approval by the Incumbent Directors);

 

(d)                                 Anyperson becomes after the effective date of the Plan the “beneficial owner” (asdefined in Rule 13d-3 under the Securities Exchange Act of 1934), directly orindirectly, of (A) 20% or more, but not 50% or more, of the combined votingpower of the Company’s outstanding securities ordinarily having the right tovote at elections of directors, unless the transaction resulting in suchownership has been approved in advance by the Incumbent Directors, or (B) 50%or more of the combined voting power of the Company’s outstanding securitiesordinarily having the right to vote at elections of directors (regardless ofany approval by the Incumbent Directors);

 

(e)                                  TheIncumbent Directors cease for any reason to constitute at least a majority ofthe Board; or

 

(f)                                    Anyother change in control of the Company of a nature that would be required to bereported pursuant to Section 13 or 15(d) of the Securities Exchange Act of1934, whether or not the Company is then subject to such reportingrequirements.

 

For purposes of thisparagraph 9, “Incumbent Directors” of the Company will mean any individuals whoare members of the Board on the effective date of the Plan and any individualwho subsequently becomes a member of the Board whose election, or nominationfor election by the Company’s shareholders, was approved by a vote of at leasta majority of the Incumbent Directors (either by specific vote or by approvalof the Company’s proxy statement in which such individual is named as a nomineefor director without objection to such nomination).

 

The Compensation Committee may, in its solediscretion, determine that the Optionee shall receive, with respect to some orall of the Option Shares, cash in an amount equal to the excess of the FairMarket Value (as defined in the Plan) of such Option Shares immediately priorto the effective date of such Change in Control over the Exercise Price.

 

The Optionee shall not be entitled to the immediateacceleration of this option or cash payments as provided in this paragraph 9 tothe extent that such acceleration or payments would, with respect to theOptionee, constitute a “parachute payment” for purposes of Internal RevenueCode Section 280G, or any successor provision.  The Compensation Committee shall have the right to eliminate,alter or reduce the acceleration of this option or any cash payment, as thecase may be, made pursuant to this paragraph 9 so that the Optionee will notreceive a “parachute payment.”

 

Notwithstanding any provision in the Option Plan orthis option to the contrary, neither the Board of Directors nor theCompensation Committee shall have the power or right, either before or afterthe occurrence of an event described in subparagraph (a) through (f) above, torescind, modify or amend the provisions of this paragraph 9 without the consentof the Optionee.

 

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**10.****                               Interpretation.**  The interpretation and construction of anyprovision of the Option Plan and this option shall be made by the CompensationCommittee and shall be final, conclusive and binding on the Optionee and allother persons.

 

**11.****                               OptionPlan Governs.**  This option is in allrespects subject to and governed by all of the provisions of the Option Plan.

 

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**IN WITNESS WHEREOF,** the Company has causedthis Agreement to be executed in its corporate name by its duly authorizedofficer, and the Optionee has executed this Agreement as of the Grant Date setforth above.

 
|   | **COMPANY:**  |   | **VITAL IMAGES, INC.** |
|--------|---------------|--------|------------------------|
|   |          |   |                   |   |
|   |          |   | By                     | /s/ Gregory S. Furness |   |
|   |          |   |                   | Name: Gregory S. Furness |
|   |          |   |                   | Title:    Chief Financial Officer, |
|   |          |   |                   | Senior Vice President - Finance |
|   |          |   |                   |
|   | **OPTIONEE:** |   |                   |
|   |          |   | /s/ Jay D. Miller      |   |
|   |          |   | Name: Jay Miller       |   |
|        |               |        |                        |  |  |  |

 

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**EXHIBITA**

 

**NOTICEOF EXERCISE OF**

**STOCKOPTION**

 

TO:

 

FROM:

 

DATE:

 

RE:                                                                              Exerciseof Stock Option

 

I here by exercise my option to purchase               shares of Common Stock at$                      per share (total exercise price of$                       ),effective today’s date.  This notice isgiven in accordance with the terms of my Stock Option Agreement dated                                ,             .  The option price and vested amount is inaccordance with Sections 2 and 3 of the Stock Option Agreement.

 

**Checkone:**

 

o                                    Attachedis cash, or a check, bank draft or money order payable to Vital Images, Inc.,or a combination thereof, for the total exercise price of the shares beingpurchased.

 

o                                    Attachedis a broker exercise notice, together with a check made payable to VitalImages, Inc. and instructions as to delivery of the shares.

 

o                                    Attachedis a certificate(s) for                         shares of common stock that I have owned for more than six months and is dulyendorsed in blank and surrendered for the exercise price of the shares beingpurchased.

 

Please prepare the stock certificate in the followingname(s):

 

Sincerely,

 

 
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