Exhibit 10.4

EXHIBIT A        ALARIS MEDICAL, INC.  1996 STOCK OPTION PLAN

(AS MODIFIED EFFECTIVE JANUARY 1, 2002)

1.NAME.

The
name of this plan is the ALARIS Medical, Inc. 1996 Stock Option Plan.

2.DEFINITIONS.

For
the purposes of the Plan, the following terms shall be defined as set forth below:

(a)  "Affiliate"
means any partnership, corporation, firm, joint venture, association, trust, unincorporated organization or other entity (other than a Subsidiary) that,
directly or indirectly through one or more intermediaries, is controlled by the Company, where the term "controlled by" means the possession, direct or indirect, of the power to cause the direction of
the management and policies of such entity, whether through the ownership of voting interests or voting securities, as the case may be, by contract or otherwise. For purposes of Section 11
below, "Affiliate" means any partnership, corporation, firm,
joint venture, association, trust, unincorporated organization or other entity that, directly or indirectly through one or more intermediaries, is "controlled by" (as defined above) Jeffry M. Picower
or the Picower Group (as defined in Section 11(b)(i) below).

(b)  "Board"
means the board of directors of the Company.

(c)  "Cause"
as applied to any Participant means: (i) the conviction of such individual for the commission of any felony; (ii) the commission by such individual
of any crime involving moral turpitude (E.G., larceny, embezzlement) which results in harm to the business, reputation, prospects or financial condition of the Company, any Subsidiary or Affiliate; or
(iii) the willful neglect, failure or refusal of such individual to carry out his duties, which results in harm to the business, reputation, prospects or financial condition of the Company, any
Subsidiary or Affiliate, which neglect, failure or refusal continues for a period of ten consecutive business days following notice thereof, or ten cumulative business days following successive
notices thereof, to such individual from the Company; PROVIDED, HOWEVER, that such willful neglect, failure or refusal is not due to the death or disability (i.e., as a result of an injury or sickness
such individual is rendered unable to perform his duties as an Officer, Employee, consultant or independent contractor, as the case may be, on a full-time basis for an extended period) of
such individual or illness leading to the death or disability of such individual.

(d)  "Closing
Price" means, except as otherwise reasonably determined by the Committee based on reported prices of a Share, (i) the daily closing price of a Share as
reported in the American Stock Exchange (or the principal exchange on which the Shares are then traded) composite transactions published in the Eastern Edition of THE WALL STREET JOURNAL or
(ii) if the Shares are traded in the over-the-counter market, the daily average of the highest bid and lowest asked prices per Share as reported through the NASDAQ
system or any successor thereto.

(e)  "Code"
means the Internal Revenue Code of 1986, as amended from time to time and the Treasury regulations promulgated thereunder.

(f)    "Committee"
means the Board or a committee appointed by the Board to administer the Plan as provided in Section 4(a).

(g)  "Common
Stock" means the $.01 par value common stock of the Company or any security of the Company identified by the Committee as having been issued in substitution or
exchange therefor or in lieu thereof.

(h)  "Company"
means ALARIS Medical, Inc., a Delaware corporation.

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(i)    "Director"
means an individual who: (i) is now, or hereafter becomes, a member of the Board or of the board of directors of any Subsidiary or Affiliate; and
(ii) is not eligible to participate in the Non-Employee Director NQSO Plan.

(j)    "Employee"
means an individual employed by the Company, a Subsidiary, or an Affiliate whose wages, if an employee in the United States, are subject to the withholding of
federal income tax under Section 3401 of the Code.

(k)  "Exchange
Act" means the Securities Exchange Act of 1934, as amended from time to time, or any successor statute.

(l)    "Fair
Market Value" of a Share as of a specified date means, except as otherwise reasonably determined by the Committee based on reported prices of a Share,
(i) the average of the highest and lowest market prices of a Share on such date as reported in the American Stock Exchange (or the principal exchange on which the Shares are then traded)
composite transactions published in the Eastern Edition of THE WALL STREET JOURNAL or, if no trading of Common Stock is reported for that day, the next preceding day on which trading was reported, or
(ii) if the Shares are traded in the over-the-counter market, the average of the highest bid and lowest asked prices per Share on the specified date (or the next
preceding date on which trading was reported) as reported through the NASDAQ system or any successor thereto.

(m)  "ISO"
means any stock option granted pursuant to the Plan that is intended to be and is specifically designated as an "incentive stock option" within the meaning of
Section 422 of the Code.

(n)  "Non-Employee
Director NQSO Plan" means the Company's Third Amended and Restated 1990 Non-Qualified Stock Option Plan for
Non-Employee Directors, as may be amended from time to time.

(o)  "NQSO"
means any stock option granted pursuant to the provisions of the Plan that is not an ISO.

(p)  "Officer"
means an individual elected or appointed by the Board or by the board of directors of a Subsidiary or Affiliate or chosen in such other manner as may be
prescribed by the by-laws of the Company, a Subsidiary or Affiliate, as the case may be, to serve as such, or, in the case of an Affiliate which is not a corporation, any individual
elected or appointed to fulfill a similar function by a body or individual exercising similar authority.

(q)  "Option"
means an ISO or a NQSO (including a NQSO which is designated as a Performance Option) granted under the Plan.

(r)  "Participant"
means an individual who is granted an Option under the Plan.

(s)  "Performance
Option" means any NQSO which is designated as a Performance Option and is subject to the performance vesting provisions set forth in Section 9(d) and
the Stock Option Agreement.

(t)    "Plan"
means this ALARIS Medical, Inc. 1996 Stock Option Plan, as it may be amended from time to time.

(u)  "Rule 16b-3"
means Rule 16b-3 promulgated by the Securities and Exchange Commission under the Exchange Act, or any successor or
replacement rule adopted by the Securities and Exchange Commission.

(v)  "Share"
means one share of Common Stock, adjusted in accordance with Section 10(b), if applicable.

(w)  "Stock
Option Agreement" means the written agreement between the Company and the Participant that contains the terms and conditions pertaining to an Option.

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(x)  "Subsidiary"
means any corporation of which the Company, directly or indirectly, is the beneficial owner of fifty percent (50%) or more of the total combined voting
power of all classes of its stock having voting power and which qualifies as a subsidiary corporation pursuant to Section 424(f) of the Code.

(y)  "Target
Date" means the date, as described in Section 9(d), on which a Target Price is achieved with respect to a Performance Option.

(z)  "Target
Price" means a target price of a Share, as determined by the Committee in its sole and absolute discretion and so designated in the Stock Option Agreement, upon
the attainment of which the applicable Vesting Percentage portion of a Performance Option shall become vested, as described in Section 9(d).

(aa)    "Ten
Percent Shareholder" means a Participant who prior to the grant of an ISO owned, directly or indirectly within the meaning of Section 424(d) of the Code,
ten percent (10%) or more of the total combined voting power of all classes of stock of the Company, any Subsidiary or any parent of the Company (as defined in Section 424(e) of the Code).

(bb)    "Vesting
Percentage" means a specified percentage of a Performance Option, as determined by the Committee in its sole and absolute discretion and set forth in the Stock
Option Agreement, which shall become vested upon the attainment of a Target Price in accordance with Section 9(d).

3.PURPOSE.

The
purpose of the Plan is to enable the Company to provide incentives, which are linked directly to increases in shareholder value, to certain key personnel in order that they will be
encouraged to promote the financial success and progress of the Company.

4.ADMINISTRATION.

(a)COMPOSITION OF THE COMMITTEE.

The
Plan shall be administered by the Board or a committee appointed by the Board. Members of that committee shall not be entitled to participate in the Plan. Subject to the provisions
of the first sentence of this Section 4(a), the Board may from time to time remove members from, or add members to, that committee. Vacancies on that committee, however caused, shall be filled
by the Board.

(b)ACTIONS BY THE COMMITTEE.

The
Committee shall hold meetings (in person or telephonically) at such times and places as it may determine. Acts approved by a majority of the members of the Committee present at a
meeting at which a quorum is present, or acts reduced to or approved in writing by a majority of the members of the Committee, shall be the valid acts of the Committee.

(c)POWERS OF THE COMMITTEE.

Subject
to the express terms and conditions hereof, the Committee shall have the authority to administer the Plan in its sole and absolute discretion. To this end, the Committee is
authorized to construe and interpret the Plan and to make all other determinations necessary or advisable for the administration of the Plan, including, but not limited to, the authority to determine
the eligible individuals who shall be granted Options, the number of Options to be granted, the vesting period, if any, for all Options granted hereunder, the date on which any Option becomes first
exercisable, the number of Shares subject to each Option, the exercise price for the Shares subject to each Option, and, whether the Option to be granted is an ISO or a NQSO. The Committee may
delegate to an Officer its authority to grant Options to eligible individuals under the Plan who are not Officers; provided, however, that Options to purchase no more than 50,000 Shares may be granted
to any individual in any calendar year pursuant to such delegation of authority. Any determination, decision or action of the

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Committee in connection with the construction, interpretation, administration or application of the Plan shall be final, conclusive and binding upon all Participants and any person validly claiming
under or through a Participant.

(d)LIABILITY OF COMMITTEE MEMBERS.

No
member of the Board or the Committee will be liable for any action or determination made in good faith by the Board or the Committee with respect to the Plan or any grant or exercise
of an Option thereunder.

(e)OPTION ACCOUNTS.

The
Committee shall maintain or cause to be maintained a journal in which a separate account for each Participant shall be established. Whenever an Option is granted to or exercised by a
Participant, the Participant's account shall be appropriately credited or debited. Appropriate adjustment shall also be made in the journal with respect to each account in the event of an adjustment
pursuant to Section 10(b).

5.EFFECTIVE DATE AND TERM OF THE PLAN.

(a)EFFECTIVE DATE OF THE PLAN.

The
Plan was adopted by the Board on November 26, 1996, and became effective on such date, subject to approval by the shareholders of the Company, which was obtained at a meeting
held on June 11, 1997. An amendment of the Plan was approved by the Board and became effective on May 28, 1998, subject to approval by the shareholders of the Company, which was obtained
at a meeting held on June 24, 1998. A further amendment of the Plan was approved by the Board and became effective on December 23, 1999, subject to approval by the shareholders of the
Company at a meeting duly called and held within twelve months following such date.

(b)TERM OF PLAN.

No
Option shall be granted pursuant to the Plan on or after November 26, 2006, but Options theretofore granted may extend beyond that date.

6.TYPE OF OPTIONS AND SHARES SUBJECT TO THE PLAN.

Options
granted under the Plan may be either ISOs or NQSOs. Each Option that is a Performance Option must be a NQSO. Each Stock Option Agreement shall specify whether the Option covered
thereby is an ISO or a NQSO and, in the case of a NQSO, whether the Option is a Performance Option.

The
maximum aggregate number of Shares that may be issued with respect to Options (other than Performance Options) under the Plan is 6,700,000 Shares. The maximum number of Shares that
may be issued with respect to Performance Options under the Plan is 2,800,000. However, no more than 1,000,000 Shares (subject to adjustment as described below) shall be awarded with respect to any
one or more Options granted to any Participant in any calendar year. The limitation on the number of Shares which may be granted under the Plan shall be subject to adjustment as provided in
Section 10(b).

If
any Option granted under the Plan expires or is terminated for any reason, any Shares as to which the Option has not been exercised shall again be available for purchase under Options
subsequently granted; PROVIDED, HOWEVER, that (i) Shares which were subject to Performance Options shall again be available for purchase only under Performance Options subsequently granted, and
(ii) Shares which were subject to Options which were not Performance Options shall again be available for
purchase only under Options subsequently granted which are not Performance Options. At all times during the term of the Plan, the Company shall reserve and keep available for issuance such

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number of Shares as the Company is obligated to issue upon the exercise of all then outstanding Options.

7.SOURCE OF SHARES ISSUED UNDER THE PLAN.

Common
Stock issued under the Plan may consist, in whole or in part, of authorized or unissued Shares or treasury Shares, as determined in the sole and absolute discretion of the
Committee. No fractional Shares shall be issued under the Plan.

8.ELIGIBILITY.

The
individuals eligible for the grant of Options under the Plan shall be: (i) all Directors, Officers and Employees; and (ii) such individuals determined by the Committee
to be rendering substantial services as a consultant or independent contractor to the Company or any Subsidiary or Affiliate of the Company, as the Committee shall determine from time to time in its
sole and absolute discretion; PROVIDED, HOWEVER, that (i) only Employees of the Company or any Subsidiary shall be eligible to receive ISOs, and (ii) only Officers and Employees who are appointed or
designated as corporate or divisional vice presidents or directors of the Company (and such other categories of Employees and consultants and independent contractors as shall be specifically approved
by the Committee) shall be eligible to receive Performance Options. Any Participant shall be eligible to be granted more than one Option hereunder.

9.OPTIONS.

(a)GRANT OF OPTIONS.

Subject
to any applicable requirements of the Code and any regulations issued thereunder, the date of the grant of an Option shall be the date on which the Committee determines to grant
the Option.

(b)EXERCISE PRICE OF ISOS AND PERFORMANCE OPTIONS.

The
exercise price of each Share subject to an ISO or a Performance Option shall be determined by the Committee but shall not be less than the Fair Market Value of a Share on the date of
grant of the ISO or Performance Option, as the case may be; PROVIDED HOWEVER, except that in the case of a grant of an ISO to a Participant who at the time such ISO was granted was a Ten Percent
Shareholder, the exercise price shall not be less than 110% of the Fair Market Value of a Share on the date of grant of the ISO.

(c)EXERCISE PRICE OF NQSOS (OTHER THAN PERFORMANCE OPTIONS).

The
exercise price of each Share subject to a NQSO (other than a Performance Option) shall be determined by the Committee at the time of grant but shall not be less than the par value of
a Share.

(d)EXERCISE PERIOD.

Each
Option granted hereunder shall vest and become first exercisable as determined by the Committee in its sole and absolute discretion and set forth in the Stock Option Agreement.
Notwithstanding the foregoing, the vesting schedule applicable to each Performance Option shall be subject to the following requirements; PROVIDED, HOWEVER, that notwithstanding the failure to achieve
any applicable Target Price(s), an outstanding Performance Option shall vest on the date that is seven (7) years after the date of grant of the Performance Option.



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(e)TERMS AND CONDITIONS.

All
Options granted pursuant to the Plan shall be evidenced by a Stock Option Agreement (which need not be the same for each Participant or Option), approved by the Committee which shall
be subject to the following express terms and conditions and the other terms and conditions as are set forth in this Section 9, and to such other terms and conditions as shall be determined by
the Committee in its sole and absolute discretion which are not inconsistent with the terms of the Plan:



(f)ADDITIONAL MEANS OF PAYMENT.

Any
Stock Option Agreement may, in the sole and absolute discretion of the Committee, permit payment by any other form of legal consideration consistent with applicable law and any rules
and regulations relating thereto, including, but not limited to, the execution and delivery of a full recourse promissory note by the Participant to the Company.

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(g)EXERCISE.

The
holder of an Option may exercise the same by filing with the Corporate Secretary of the Company a written election, in such form as the Committee may determine, specifying the number
of Shares with respect to which such Option is being exercised, and accompanied by payment in full of the exercise price for such Shares. Notwithstanding the foregoing, the Committee may specify a
reasonable minimum number of Shares that may be purchased on any exercise of an Option, provided that such minimum number will not prevent the Participant from exercising the Option with respect to
the full number of Shares as to which the Option is then exercisable.

(h)WITHHOLDING TAXES.

Prior
to issuance of the Shares upon exercise of an Option, the Participant shall pay or make adequate provision for the payment of any federal, state, local or foreign withholding
obligations of the Company or any Subsidiary or Affiliate of the Company, if applicable. In the event a Participant shall fail to make adequate provision for the payment of such obligations, the
Company shall have the right to withhold an amount of Shares otherwise deliverable to the Participant sufficient to pay such withholding obligations or, in the discretion of the Committee, to refuse
to honor the exercise.

(i)TERMINATION OF OPTIONS.

Options
granted under the Plan shall be subject to the following events of termination, unless otherwise provided in the Stock Option Agreement:



10.RECAPITALIZATION.

(a)CORPORATE FLEXIBILITY.

The
existence of the Plan and the Options granted hereunder shall not affect or restrict in any way the right or power of the Board or the shareholders of the Company, in their sole and
absolute discretion, to make, authorize or consummate any adjustment, recapitalization, reorganization or other change in the Company's capital structure or its business, any merger or consolidation
of the Company,

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any issue of bonds, debentures, common stock, preferred or prior preference stock ahead of or affecting the Company's capital stock or the rights thereof, the dissolution or liquidation of the
Company or any sale or transfer of all or any part of its assets or business, or any other grant of rights, issuance of securities, transaction, corporate act or proceeding and notwithstanding the
fact that any such activity, proceeding, action, transaction or other event may have, or be expected to have, an impact (whether positive or negative) on the value of any Option or underlying Shares.

(b)ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.

Except
as otherwise provided in Section 11, in the event of any change in capitalization affecting the Common Stock of the Company, such as a stock dividend, stock split or
recapitalization, the Committee shall make proportionate adjustments with respect to: (i) the aggregate number of Shares available for issuance under the Plan; (ii) the number of Shares
available for any individual award; (iii) the number and exercise price of Shares subject to outstanding Options; PROVIDED, HOWEVER, that the number of Shares subject to any Option shall always
be a whole number; (iv) the Target Price with respect to any Performance Options; and (v) such other matters as shall be appropriate in light of the circumstances.

11.CHANGE OF CONTROL

(a)  In
the event of a Change of Control (as defined below), unless otherwise determined by the Committee at the time of grant or by amendment (with the holder's consent) of
such grant, all Options (other than Performance Options) not vested on or prior to the effective time of any such Change of Control shall vest immediately prior to such effective time. Unless
otherwise determined by the Committee in the Stock Option Agreement or at the time of a Change of Control, in the event of a Change of Control, all outstanding Options (including Performance Options)
shall terminate and cease to be outstanding immediately following the Change of Control; PROVIDED, HOWEVER, that no such Option termination shall occur unless a Participant shall have been given five
business days, following prior written notice, to exercise such Participant's outstanding vested Options at the effective time of the Change of Control, or at the discretion of the Committee to
receive cash in an amount per Share subject to such Options equal to the amount by which the price paid for a Share (determined on a fully diluted basis and taking into account the exercise price, as
determined by the Committee) in the Change of Control exceeds the per share exercise price of such Options. The Committee in its sole and absolute discretion may make provisions for the assumption of
outstanding Options, or the substitution for outstanding Options of new incentive awards covering the stock of a successor corporation or a parent or subsidiary thereof, with appropriate adjustments
as to the number and kind of shares and prices so as to prevent dilution or enlargement of rights.

(b)  A
"Change of Control" will be deemed to occur on the date any of the following events occur:



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(c)  Notwithstanding
the foregoing provisions of this Section 11, unless otherwise determined by the Committee at the time of grant or by amendment (with the holder's
consent) of such grant, in the event of a Sale Transaction (as defined below), all Performance Options not fully vested on or prior to
the effective time of any such Sale Transaction shall vest immediately prior to such effective time, in whole or in part, if and only to the extent the price to be paid per Share (determined on a
fully diluted basis and taking into account the exercise price, as determined by the Committee) in the Sale Transaction equals or exceeds the Target Price with respect to the applicable vesting
percentage of such Performance Option. For purposes of this Section 11, a "Sale Transaction" will be deemed to have occurred on the date any of the following events shall have occurred:



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12.SECURITIES LAW REQUIREMENTS.

No
Shares shall be issued under the Plan unless and until: (i) the Company and the Participant have taken all actions required to register the Shares under the Securities Act of
1933, as amended, or perfect an exemption from the registration requirements thereof; (ii) any applicable listing requirement of any stock exchange or national market system on which the Common
Stock is listed has been satisfied; and (iii) any other applicable provision of state or federal law has been satisfied. The
Company shall be under no obligation to register the Shares with the Securities and Exchange Commission or to effect compliance with the registration or qualification requirements of any state
securities laws or stock exchange.

13.AMENDMENT AND TERMINATION.

(a)MODIFICATIONS TO THE PLAN.

The
Board may, insofar as permitted by law, from time to time, with respect to any Shares at the time not subject to Options, suspend or terminate the Plan or revise or amend the Plan in
any respect whatsoever. However, unless the Board specifically otherwise provides, any revision or amendment that would cause the Plan to fail to comply with Section 422 or 162(m) of the Code
or any other requirement of applicable law or regulation if such amendment were not approved by the shareholders of the Company, shall not be effective unless and until such approval is obtained.

(b)RIGHTS OF PARTICIPANT.

No
amendment, suspension or termination of the Plan or of any Option that would adversely affect the right of any Participant with respect to an Option previously granted under the Plan
will be effective without the written consent of the affected Participant.

14.MISCELLANEOUS.

(a)SHAREHOLDERS' RIGHTS

No
Participant and no beneficiary or other person claiming under or through such Participant shall acquire any rights as a shareholder of the Company by virtue of such Participant having
been granted an Option under the Plan. No Participant and no beneficiary or other person claiming under or

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through such Participant will have any right, title or interest in or to any Shares allocated or reserved under the Plan or subject to any Option, except as to Shares, if any, that have been issued
or transferred to such Participant. No adjustment shall be made for dividends or distributions or other rights for which the record date is prior to the date of exercise of an Option, except as may be
provided in the Stock Option Agreement.

(b)OTHER COMPENSATION ARRANGEMENTS.

Nothing
contained in the Plan shall prevent the Board from adopting other compensation arrangements, subject to shareholder approval if such approval is required. Such other arrangements
may be either generally applicable or applicable only in specific cases.

(c)TREATMENT OF PROCEEDS.

Proceeds
realized from the exercise of Options under the Plan shall constitute general funds of the Company.

(d)COSTS OF THE PLAN.

The
costs and expenses of administering the Plan shall be borne by the Company.

(e)NO RIGHT TO CONTINUE EMPLOYMENT OR SERVICES.

Nothing
contained in the Plan or in any instrument executed pursuant to the Plan will confer upon any Participant any right to continue to render services to the Company, a Subsidiary or
Affiliate; to continue as a Director, Officer, Employee, consultant or independent contractor; or affect the right of the Company, a Subsidiary, an Affiliate, the Board, the board of directors of a
Subsidiary or an Affiliate, the shareholders of the Company or a Subsidiary, or the holders of interests of an Affiliate, as applicable, to terminate the directorship, office, employment or consultant
or independent contractor relationship, as the case may be, of any Participant at any time with or without Cause. The term "Cause" as defined herein is included solely for the purposes of the Plan and
is not, and shall not be deemed to be: (i) a restriction on the right of the Company, a Subsidiary or Affiliate, as the case may be, to terminate any Officer or Employee for any reason
whatsoever; or (ii) a part of the employment relationship (whether oral or written, express or implied) of any such individual.

(f)SEVERABILITY.

The
provisions of the Plan shall be deemed severable and the validity or unenforceability of any provision shall not affect the validity or enforceability of the other provisions hereof.

(g)GOVERNING LAW.

The
Plan and all actions taken thereunder shall be enforced, governed and construed by and interpreted under the laws of the State of Delaware applicable to contracts made and to be
performed wholly within such State without giving effect to the principles of conflict of laws thereof.

(h)HEADINGS.

The
headings contained in this Plan are for reference purposes only and shall not affect in any way the meaning or interpretation of this Plan.

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