Exhibit
10.6


 


DATA SCIENCES,
INC. 

1992 STOCK OPTION PLAN


 


1.             Purpose
of Plan.


 


This Plan shall be known as the “DATA SCIENCES, INC.
1992 STOCK OPTION PLAN” and is hereinafter referred to as the “Plan”. The
purpose of the Plan is to aid in maintaining and developing personnel capable
of assuring the future success of Data Sciences, Inc., a Minnesota corporation
(the “Company”), to offer such personnel additional incentives to put forth
maximum efforts for the success of the business, and to afford them an opportunity
to acquire a proprietary interest in the Company through stock options. Options
granted under this Plan may be either incentive stock options (“Incentive Stock
Options”) within the meaning of Section 422 of the Internal Revenue Code of
1986 (the “Code”), or options which do not qualify as Incentive Stock Options.


 


2.             Stock
Subject to Plan.


 


Subject to the provisions of Section 12 hereof, the
stock to be subject to options under the Plan shall be the Company’s authorized
Common Shares, no par value per share. Such shares may be either authorized but
unissued shares, or issued shares which have been reacquired by the Company.
Subject to adjustment as provided in Section 12 hereof, the maximum number of
shares on which options may be exercised issued under this Plan shall be 87,695
shares. If an option under the Plan expires, or for any reason is terminated or
unexercised with respect to any shares, such shares shall again be available
for options thereafter granted during the term of the Plan.


 

















 


3.             Administration
of Plan.


 


(a)           The
Plan shall be administered by the Board of Directors of the Company or a
committee thereof. The members of any such committee shall be appointed by and
serve at the pleasure of the Board of Directors. (The group administering the
Plan shall hereinafter be referred to as the “Committee”.)


 


(b)           The
Committee shall have plenary authority in its discretion, but subject to the
express provisions of the Plan: (i) to determine the purchase price of the
Common Stock covered by each option, (ii) to determine the employees to whom and
the time or times at which such options shall be granted and the number of
shares to be subject to such options, (iii) to determine the terms of exercise
of each option, (iv) to accelerate the time at which all or any part of an
option may be exercised, (v) to amend or modify the terms of any option with
the consent of the optionee, (vi) to interpret the Plan, (vii) to prescribe,
amend and rescind rules and regulations relating to the Plan, (viii) to determine
the terms and provisions of each option agreement under the Plan (which
agreements need not be identical), including the designation of those options
intended to be Incentive Stock Options, and (ix) to make all other
determinations necessary or advisable for the administration of the Plan,
subject to the exclusive authority of the Board of Directors under Section 13
herein to amend or terminate the Plan. The Committee’s determinations on the
foregoing matters, unless otherwise disapproved by the Board of Directors of
the Company, shall be final and conclusive.


 


(c)           The
Committee shall select one of its members as its Chairman and shall hold its
meetings at such times and places as it may determine. A majority of its
members shall constitute a quorum. All determinations of the Committee shall be
made by not less than a majority of its members. Any decision or determination reduced
to 


 


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writing and signed
by all of the members of the Committee shall be fully effective as if it had
been made by a majority vote at a meeting duly called and held. The grant of an
option shall be effective only if a written agreement shall have been duly
executed and delivered by and on behalf of the Company following such grant. The
Committee may appoint a Secretary and may make such rules and regulations for
the conduct of its business as it shall deem advisable.


 


4.             Eligibility.


 


Incentive Stock Options may only be granted under this
Plan to any full or part-time employee (which term as used herein includes, but
is not limited to, officers and directors who are also employees) of the
Company and of its present and future subsidiary corporations within the
meaning of Section 424(f) of the Code (herein called “subsidiaries”). Full or
part-time employees, directors who are not also employees, consultants or
independent contractors to the Company or one of its subsidiaries shall be
eligible to receive options which do not qualify as Incentive Stock Options. In
determining the persons to whom options shall be granted and the number of
shares subject to such options, the Committee may take into account the nature
of services rendered by the respective employees or consultants, their present
and potential contributions to the success of the Company and such other factors
as the Committee in its discretion shall deem relevant. A person who has been
granted an option under this Plan may be granted additional options under the Plan
if the Committee shall so determine; provided, however, that for Incentive Stock
Options granted after December 31, 1986, to the extent the aggregate fair
market value (determined at the time the Incentive Stock Option is granted) of
the Common Shares with respect to which all Incentive Stock Options are exercisable
for the first time by an employee during any 


 


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calendar year
(under all plans described in subsection (d) of Section 422 of the Code of his
employer corporation and its parent and subsidiary corporations) exceeds
$100,000, such options shall be treated as options which do not qualify as
Incentive Stock Options. Nothing in the Plan or in any agreement thereunder
shall confer on any employee any right to continue in the employ of the Company
or any of its subsidiaries or affect, in any way, the right of the Company or
any of its subsidiaries to terminate his or her employment at any time.


 


5.             Price.


 


The option price for all Incentive Stock Options
granted under the Plan shall be determined by the Committee but shall not be
less than 100% of the fair market value of the Common Shares at the date of
grant of such option. The option price for options granted under the Plan which
do not qualify as Incentive Stock Options shall also be determined by the Committee
but shall not be less than 100% of the fair market value of the Common Shares
at the date of grant of such option. For purposes of the preceding two
sentences and for all other valuation purposes under the Plan, the fair market
value of the Common Shares shall be as reasonably determined by the Committee.
If on the date of grant of any option hereunder the Common Shares are not
traded on an established securities market, the Committee shall make a good
faith attempt to satisfy the requirements of this Section 5 and in connection
therewith shall take such action as it deems necessary or advisable.


 


6.             Term.


 


Each option and all rights and obligations thereunder
shall expire on the date determined by the Committee and specified in the
option agreement. The Committee 


 


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shall be under no
duty to provide terms of like duration for options granted under the Plan, but
the term of an Incentive Stock Option may not extend more than ten (10) years
from the date of grant of such option and the term of options granted under the
Plan which do not qualify as Incentive Stock Options may not extend more than
fifteen (15) years from the date of granting of such option.


 


7.             Exercise
of Option.


 


(a)           The
Committee shall have full and complete authority to determine whether an option
will be exercisable in full at any time or from time to time during the term
thereof, or to provide for the exercise thereof in such installments, upon the
occurrence of such events (such as termination of employment for any reason)
and at such times during the term of the option as the Committee may determine
and specify in the option agreement.


 


(b)           The
exercise of any option granted hereunder shall only be effective at such time
that the sale of Common Shares pursuant to such exercise will not violate any
state or federal securities or other laws.


 


(c)           An
optionee or grantee electing to exercise an option shall give written notice to
the Company of such election and of the number of shares subject to such
exercise. The full purchase price of such shares shall be tendered with such
notice of exercise. Payment shall be made to the Company in cash (including
bank check, certified check, personal check, or money order), or, at the discretion
of the Committee and as specified by the Committee, (i) by delivering
certificates for the Company’s Common Shares already owned by the optionee or
grantee having a fair market value as of the date of grant equal to the full
purchase price of the shares, or (ii) by delivering the optionee’s 


 


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or grantee’s
promissory note, which shall provide for interest at a rate not less than the
minimum rate required to avoid the imputation of income, original issue
discount or a below-market-rate loan pursuant to Sections 483, 1274 or 7872 of
the Code or any successor provisions thereto, or (iii) a combination of cash,
the optionee’s or grantee promissory note and such shares. The fair market
value of such tendered shares shall be determined as provided in Section 5
herein. The optionee’s or grantee’s promissory note shall be a full recourse
liability of the optionee and may, at the discretion of the Committee, be
secured by a pledge of the shares being purchased. Until such person has been
issued the shares subject to such exercise, he or she shall possess no rights
as a shareholder with respect to such shares.


 


8.             Income
Tax Withholding and Tax Bonuses.


 


(a)           In
order to comply with all applicable federal or state income tax laws or
regulations, the Company may take such action as it deems appropriate to ensure
that all applicable federal or state payroll, withholding, income or other taxes,
which are the sole and absolute responsibility of an optionee or grantee under the
Plan, are withheld or collected from such optionee or grantee. In order to
assist an optionee or grantee in paying all federal and state taxes to be
withheld or collected upon exercise of an option which does not qualify as an
Incentive Stock Option hereunder, the Committee, in its absolute discretion and
subject to such additional terms and conditions as it may adopt, shall permit
the optionee or grantee to satisfy such tax obligation by (i) electing to have
the Company withhold a portion of the shares otherwise to be delivered upon
exercise of such option with a fair market value, determined in accordance with
Section 5 herein, equal to such taxes or (ii) delivering to the Company Common
Shares other than the 


 


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shares issuable
upon exercise of such option with a fair market value, determined in accordance
with Section 5, equal to such taxes.


 


(b)           The
Committee shall have the authority, at the time of grant of an option under the
Plan or at any time thereafter, to approve tax bonuses to designated optionees
or grantees to be paid upon their exercise of options granted hereunder. The
amount of any such payments shall be determined by the Committee. The Committee
shall have full authority in its absolute discretion to determine the amount of any such tax bonus and the terms and conditions
affecting the vesting and payment thereafter.


 


9.             Additional
Restrictions.


 


The Committee shall have
full and complete authority to determine whether all or any part of the Common
Shares of the Company acquired upon exercise of any of the options granted
under the Plan shall be subject to restrictions on the transferability thereof
or any other restrictions affecting in any manner the optionee’s or grantee’s
rights with respect thereto, but any such restriction shall be contained in the
agreement relating to such options.


 


10.           Ten
Percent Shareholder Rule.


 


Notwithstanding any other
provision in the Plan, if at the time an option is otherwise to be granted
pursuant to the Plan the optionee owns directly or indirectly (within the
meaning of Section 424(d) of the Code) Common Shares of the Company possessing
more than ten percent (10%) of the total combined voting power of all classes
of stock of the Company or its parent or subsidiary corporations, if any
(within the meaning of Section 422(b)(6) of the Code), then any Incentive Stock
Option to be granted to such optionee pursuant to the Plan shall satisfy the requirements
of Section 422(c)(5) of 


 


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the Code, and the option price shall be not less than 110% of the fair
market value of the Common Shares of the Company determined as described
herein, and such option by its terms shall not be exercisable after the
expiration of five (5) years from the date such option is granted.


 


11.           Non-
Transferability.


 


No option granted under the Plan shall be transferable
by an optionee or grantee, otherwise than by will or the laws of descent or
distribution. Except as otherwise provided in an option agreement, during the
lifetime of an optionee or grantee, the option shall be exercisable only by
such optionee or grantee.


 


12.           Dilution
or Other Adjustments.


 


If there shall be any change in the Common Shares
through merger, consolidation, reorganization, recapitalization, dividend in
the form of stock (of whatever amount), stock split or other change in the
corporate structure, appropriate adjustments in the Plan and outstanding
options shall be made by the Committee. In the event of any such changes,
adjustments shall include, where appropriate, changes in the aggregate number
of shares subject to the Plan and the number of shares and the price per share
subject to outstanding options, in order to prevent dilution or enlargement of
option rights.


 


13.           Amendment
or Discontinuance of Plan.


 


The Board of Directors may amend or discontinue the
Plan at any time. Subject to the provisions of Section 12 no amendment of the
Plan, however, shall without shareholder approval: (i) increase the maximum
number of shares under the Plan as 


 


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provided in
Section 2 herein, (ii) decrease the minimum price provided in Section 5 herein,
(ill) extend the maximum term under Section 6, or (iv) modify the eligibility
requirements for participation in the Plan. The Board of Directors shall not
alter or impair any option theretofore granted under the Plan without the consent
of the holder of the option.


 


14.           Time
of Granting.


 


Nothing contained in the Plan or in any resolution
adopted or to be adopted by the Board of Directors or by the shareholders of
the Company, and no action taken by the Committee or the Board of Directors
(other than the execution and delivery of an option agreement), shall
constitute the granting of an option hereunder.


 


15.           Effective
Date and Termination of Plan.


 


(a)           The
Plan was approved by the Board of Directors on August 26, 1992, and shall
be approved by the shareholders of the Company within twelve (12) months
thereof.


 


(b)           Unless
the Plan shall have been discontinued as provided in Section 13 hereof, the
Plan shall terminate August 25, 2002. No option may be granted after such
termination, but termination of the Plan shall not, without the consent of the
optionee or grantee, alter or impair any rights or obligations under any option
theretofore granted.


 


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