Document:

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                                                                   EXHIBIT 10.21

                                                                 As Amended 3/01

                       GUIDANT CORPORATION 1994 STOCK PLAN

         The Guidant Corporation 1994 Stock Plan ("1994 Plan") authorizes the
Compensation Committee ("Committee") of the Board of Directors of Guidant
Corporation to provide employees and consultants of Guidant Corporation and its
subsidiaries with certain rights to acquire shares of Guidant Corporation common
stock ("Guidant Stock"). The Company believes that this incentive program will
benefit the Company's shareholders by allowing the Company to attract, motivate,
and retain employees and consultants and by causing employees and consultants,
through stock-based incentives, to contribute materially to the growth and
success of the Company. For purposes of the 1994 Plan, the term "Company" shall
mean Guidant Corporation and its subsidiaries, unless the context requires
otherwise.

1.       ADMINISTRATION.

         The 1994 Plan shall be administered and interpreted by the Committee
consisting of not less than three persons appointed by the Board of Directors of
the Company from among its members. A person may serve on the Committee only if
he or she (i) is a nonemployee director as defined in Rule 16b-3(b)(3) under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and (ii)
satisfies the requirements of an "outside director" for purposes of Section
162(m) of the Internal Revenue Code of 1986, as amended (the "Code"). The
Committee shall determine the fair market value of Guidant Stock for purposes of
the 1994 Plan. The Committee may, subject to the provisions of the 1994 Plan,
from time to time establish such rules and regulations as it deems appropriate
for the proper administration of the Plan. The Committee's decisions shall be
final, conclusive, and binding with respect to the interpretation and
administration of the 1994 Plan and any Grant made under it. Except to the
extent expressly prohibited by the 1994 Plan or applicable law, the Committee
may delegate to one or more of its members, or to one or more agents, such
responsibility or duties as it deems desirable.

2.       GRANTS.

         Incentives under the 1994 Plan shall consist of incentive stock
options, nonqualified stock options, performance awards, and restricted stock
grants (collectively, "Grants"). All

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Grants shall be subject to the terms and conditions set out herein and to such
other terms and conditions which are not inconsistent with the 1994 Plan as the
Committee deems appropriate. The Committee shall approve the form and provisions
of each Grant. Grants under a particular section of the 1994 Plan need not be
uniform and Grants under two or more sections may be combined in one instrument.

3.       ELIGIBILITY FOR GRANTS.

         Grants may be made to any employee (including any officer) or
consultant of the Company ("Eligible Person"). The Committee shall select the
persons to receive Grants ("Grantees") from among the Eligible Persons and
determine the number of shares subject to any particular Grant.

4.       SHARES AVAILABLE FOR GRANT.

         (a) Shares Subject to Issuance or Transfer. Subject to adjustment as
provided in Section 4(b), the aggregate number of shares of Guidant Stock that
may be issued or transferred under the 1994 Plan is 7,000,000. The shares may be
authorized but unissued shares or treasury shares. The number of shares
available for Grants at any given time shall be 7,000,000, reduced by the
aggregate of all shares previously issued or transferred and of shares which may
become subject to issuance or transfer under then-outstanding Grants. Payment in
cash in lieu of shares shall be deemed to be an issuance of the shares for
purposes of determining the number of shares available for Grants under the 1994
Plan as a whole or to any individual Grantee.

         (b) Adjustment Provisions. If any subdivision or combination of shares
of Guidant Stock or any stock dividend, reorganization, recapitalization, or
consolidation or merger with Guidant Corporation as the surviving corporation
occurs, or if additional shares or new or different shares or other securities
of the Company or any other issuer are distributed with respect to the shares of
Guidant Stock through a spin-off, exchange offer, or other extraordinary
distribution, the Committee shall make such adjustments as it determines
appropriate in the number of shares of Guidant Stock that may be issued or
transferred in the future under Sections 4(a) and 5(f). The Committee shall also
adjust as it determines appropriate the number of shares and Option Price in
outstanding Grants made before the event.

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5.       STOCK OPTIONS.

         The Committee may grant options qualifying as incentive stock options
under the Code ("Incentive Stock Options"), and nonqualified options
(collectively, "Stock Options"). The following provisions are applicable to
Stock Options:

         (a) Option Price. The Committee shall determine the price at which
Guidant Stock may be purchased by the Grantee under a Stock Option ("Option
Price") which, except in the case of substitute grants as described in Section
10(b), shall be not less than the fair market value of Guidant Stock on the date
the Stock Option is granted (the "Grant Date"). In the Committee's discretion,
the Grant Date of a Stock Option may be established as the date on which
Committee action approving the Stock Option is taken or any later date specified
by the Committee.

         (b) Option Exercise Period. The Committee shall determine the option
exercise period of each Stock Option. The period shall not exceed ten years from
the Grant Date.

         (c) Exercise of Option. A Grantee may exercise a Stock Option by
delivering a notice of exercise to the Company or its representative as
designated by the Committee, either with or without accompanying payment of the
Option Price. The notice of exercise, once delivered, shall be irrevocable.

         (d) Satisfaction of Option Price. The Grantee shall pay or cause to be
paid the Option Price in cash, or with the Committee's permission, by delivering
shares of Guidant Stock already owned by the Grantee and having a fair market
value on the date of exercise equal to the Option Price, or a combination of
cash and shares. In addition, the Committee may permit the exercise of an option
by delivery of written notice, subject to the Company's receipt of a third-party
payment in full in cash for the Option Price prior to the issuance of shares of
Guidant Stock, in the manner and subject to the procedures as may be established
by the Committee. Unless the Committee establishes a shorter period which is set
forth in the Stock Option, the Grantee shall pay the Option Price not later than
30 days after the date of a statement from the Company following exercise
setting forth the Option Price, fair market value of Guidant Stock on the
exercise date, the number of shares of Guidant Stock that may be delivered in
payment of the Option Price, and the amount of withholding tax due, if any. If
the Grantee fails to pay the Option Price within the

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specified period, the Committee shall have the right to take whatever action it
deems appropriate, including voiding the option exercise. The Company shall not
issue or transfer shares of Guidant Stock upon exercise of a Stock Option until
the Option Price and any required withholding tax are fully paid.

         (e) Share Withholding. With respect to any nonqualified option, the
Committee may, in its discretion and subject to such rules as the Committee may
adopt, permit or require the Grantee to satisfy, in whole or in part, any
withholding tax obligation which may arise in connection with the exercise of
the nonqualified option by having the Company withhold shares of Guidant Stock
having a fair market value equal to the amount of the withholding tax.

         (f) Limits on Individual Grants. No individual Grantee may be granted
Stock Options under the 1994 Plan for more than 700,000 shares of Guidant Stock
during any three consecutive calendar years.

         (g) Limits on Incentive Stock Options. The aggregate fair market value
of the stock covered by Incentive Stock Options granted under the 1994 Plan or
any other stock option plan of the Company or any subsidiary or parent of the
Company that become exercisable for the first time by any employee in any
calendar year shall not exceed $100,000. The aggregate fair market value will be
determined at the Grant Date. An Incentive Stock Option shall not be granted to
any Eligible Person who, on the Grant Date, owns stock possessing more than 10%
of the total combined voting power of all classes of stock of the Company or any
subsidiary or parent of the Company.

6.       PERFORMANCE AWARDS.

         The Committee may grant Performance Awards which shall be denominated
at the time of grant either in shares of Guidant Stock ("Stock Performance
Awards") or in dollar amounts ("Dollar Performance Awards"). Payment under a
Stock Performance Award or a Dollar Performance Award shall be made, at the
discretion of the Committee, in shares of Guidant Stock ("Performance Shares"),
or in cash or in any combination thereof, if the financial performance of the
Company or any subsidiary, division, or other unit of the Company ("Business
Unit") selected by the Committee for the Award Period (as defined below). The
following provisions are applicable to Performance Awards:

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         (a) Award Period. The Committee shall determine and include in the
Grant the period of time (which shall be four or more consecutive fiscal
quarters) for which a Performance Award is made ("Award Period"). Grants of
Performance Awards need not be uniform with respect to the length of the Award
Period. Award Periods for different Grants may overlap. A Performance Award may
not be granted for a given Award Period after one half (1/2) or more of such
period has elapsed.

         (b) Performance Goals and Payment. Before a Grant is made, the
Committee shall establish objectives ("Performance Goals") that must be met by
the Business Unit during the Award Period as a condition to payment being made
under the Performance Award. The Performance Goals, which must be set out in the
Grant, may include earnings per share, return on assets, return on shareholders'
equity, divisional income, net income, or any other financial measurement
established by the Committee. The Committee shall also set forth in the Grant
the number of Performance Shares or the amount of payment to be made under a
Performance Award if the Performance Goals are met or exceeded, including the
fixing of a maximum payment.

         (c) Computation of Payment. After an Award Period, the financial
performance of the Business Unit during the period shall be measured against the
Performance Goals. If the Performance Goals are not met, no payment shall be
made under a Performance Award. If the Performance Goals are met or exceeded,
the Committee shall determine the number of Performance Shares or the amount of
payment to be made under a Performance Award in accordance with the grant for
each Grantee. The Committee, in its sole discretion, may elect to pay part or
all of the Performance Award in cash in lieu of issuing or transferring
Performance Shares. The cash payment shall be based on the fair market value of
Guidant Stock on the date of payment. The Company shall promptly notify each
Grantee of the number of Performance Shares and the amount of cash, if any, he
or she is to receive.

         (d) Revisions for Significant Events. At any time before payment is
made, the Committee may revise the Performance Goals and the computation of
payment if unforeseen events occur during an Award Period which have a
substantial effect on the Performance Goals and which in the sole discretion of
the Committee make the application of the Performance Goals unfair unless a
revision is made.

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         (e) Requirement of Employment. To be entitled to receive payment under
a Performance Award, a Grantee who is an employee of the Company must remain in
the employment of the Company to the end of the Award Period, except that the
Committee may provide for partial or complete exceptions to this requirement as
it deems equitable in its sole discretion.

7.       RESTRICTED STOCK GRANTS.

         The Committee may issue or transfer shares of Guidant Stock to a
Grantee under a Restricted Stock Grant. Upon the issuance or transfer, the
Grantee shall be entitled to vote the shares and to receive any dividends paid.
The following provisions are applicable to Restricted Stock Grants:

         (a) Requirement of Employment. If the employment of a Grantee who is an
employee of the Company terminates during the period designated in the Grant as
the "Restriction Period," the Restricted Stock Grant terminates and the shares
of Guidant Stock must be returned immediately to the Company. However, the
Committee may provide for partial or complete exceptions to this requirement as
it deems equitable.

         (b) Restrictions on Transfer and Legend on Stock Certificate. During
the Restriction Period, a Grantee may not sell, assign, transfer, pledge, or
otherwise dispose of the shares of Guidant Stock except to a Successor Grantee
under Section 10(a). Each certificate for shares issued or transferred under a
Restricted Stock Grant shall contain a restricted legend or be held in escrow by
the Company until the expiration of the Restriction Period.

         (c) Lapse of Restrictions. All restrictions imposed under the
Restricted Stock Grant shall lapse (i) upon the expiration of the Restriction
Period if all conditions, including those stated in Sections 7(a) and (b) have
been met or (ii) as provided under Section 9(a)(ii). The Grantee shall then be
entitled to delivery of the certificate.

8.       AMENDMENT AND TERMINATION OF THE 1994 PLAN.

         (a) Amendment. The Company's Board of Directors may amend or terminate
the 1994 Plan, subject to shareholder approval to the extent necessary for the
continued applicability of Rule 16b-3 under the Exchange Act, but no amendment
shall withdraw from the Committee the right to select Grantees under Section 3.

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         (b) Termination of 1994 Plan. The 1994 Plan shall terminate on May 31,
2004, unless terminated earlier by the Board or unless extended by the Board.

         (c) Termination and Amendment of Outstanding Grants. A termination or
amendment of the 1994 Plan that occurs after a Grant is made shall not result in
the termination or amendment of the Grant unless the Grantee consents or unless
the Committee acts under Section 11(e). The termination of the 1994 Plan shall
not impair the power and authority of the Committee with respect to outstanding
Grants. Whether or not the 1994 Plan has terminated, an outstanding Grant may be
terminated or amended under Section 11(e) or may be amended (i) by agreement of
the Company and the Grantee consistent with the 1994 Plan or (ii) by action of
the Committee provided that the amendment is consistent with the 1994 Plan and
is found by the Committee not to materially impair the rights of the Grantee
under the Grant.

9.       CHANGE OF CONTROL.

         (a) Effect on Grants. Unless the Committee shall otherwise expressly
provide in the agreement relating to a Grant, upon the occurrence of a Change of
Control (as defined below):

         (i) In the case of Stock Options, (A) each outstanding Stock Option
that is not then fully exercisable shall automatically become fully exercisable
until the termination of the option exercise period of the Stock Option (as
modified by subsection (i)(B) that follows, and (B) in the event the Grantee's
employment is terminated within two years after a Change of Control, his or her
outstanding Stock Options at that date of termination shall be immediately
exercisable for a period of three months following such termination, provided,
however, that, to the extent the Stock Option by its terms otherwise permits a
longer option exercise period after such termination, such longer period shall
govern, and provided further that in no event shall a Stock Option be
exercisable more than 10 years after the Grant Date;

         (ii) The Restriction Period on all outstanding Restricted Stock Grants
shall automatically expire and all restrictions imposed under such Restricted
Stock Grants shall immediately lapse; and

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         (iii) Each Grantee of a Performance Award for an Award Period that has
not been completed at the time of the Change of Control shall be deemed to have
earned a minimum Performance Award equal to the product of (A) such Grantee's
maximum award opportunity for such Performance Award and (B) a fraction, the
numerator of which is the number of full and partial months that have elapsed
since the beginning of such Award Period to the date on which the Change of
Control occurs, and the denominator of which is the total number of months in
such Award Period.

         (b) Change of Control. For purposes of the 1994 Plan, a Change of
Control shall mean the happening of any of the following events:

         (i) The acquisition by any "person," as that term is used in Sections
13(d) and 14(d) of the Exchange Act (other than (A) the Company, (B) any
subsidiary of the Company, (C) any employee or directors' benefit plan or stock
plan of the Company or a subsidiary of the Company, or any trustee or fiduciary
with respect to any such plan when acting in that capacity, or (D) any person
who acquires such shares pursuant to a transaction or series of transactions
approved prior to such transaction(s) by the Board of Directors of the Company)
of "beneficial ownership" as defined in Rule 13d-3 under the Exchange Act,
directly or indirectly, of 20% or more of the shares of the Company's capital
stock the holders of which have general voting power under ordinary
circumstances to elect at least a majority of the Board of Directors of the
Company (or which would have such voting power but for the application of the
Indiana Control Share Statute) ("Voting Stock");

         (ii) the first day on which less than two-thirds of the total
membership of the Board of Directors of the Company shall be Continuing
Directors (as that term is defined in Article 6(f) of the Company's Articles of
Incorporation;

         (iii) approval by the shareholders of the Company of a merger, share
exchange, or consolidation of the Company (a "Transaction"), other than a
Transaction which would result in the Voting Stock of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) more than 50% of the Voting Stock of the Company or such surviving
entity immediately after such Transaction; or

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         (iv) approval by the shareholders of the Company of a complete
liquidation of the Company or a sale or disposition of all or substantially all
the assets of the Company.

10.      ELIGIBLE PERSONS RESIDENT OUTSIDE THE UNITED STATES.

         The following provisions shall apply to each Eligible Person who is
resident outside the United States:

         (a) Determination of Eligible Locations. The Committee shall determine
whether it is feasible or desirable under local law, custom and practice to make
Grants at each location outside the United States. In making this determination
as of any Grant Date, the Committee may differentiate among classes of
individuals (including expatriates, third country nationals or international
assignees) and locations within a particular country.

         (b) Special Terms Applicable to Grants. In order to facilitate the
making of Grants under this Section 10, the Committee may provide for such
special terms for Grants to Grantees who are foreign nationals or who are
employed outside the United States as the Committee may consider necessary or
desirable to accommodate differences in local law, policy or custom, or to take
advantage of special tax or social insurance regimes applicable in a particular
jurisdiction. The Committee may approve such supplements, restatements or
alternate versions of the Plan as it may consider necessary or desirable for
such purposes, without thereby affecting the terms of the Plan as in effect for
any other purpose. Without limiting the generality of the foregoing, the
Committee may adopt special sub-plans applicable to individuals in particular
jurisdictions (e.g., French or U.K. qualified plans), may provide for
accelerated vesting with restrictions on the shares received under a Grant, and
may condition Grants on acknowledgments or agreements by Grantees tailored to
local law.

         (c) No Acquired Rights. Nothing in the 1994 Plan or in this Section 10
shall confer upon any individual in any country the right to receive (or to
continue to receive) any Grant, any form of Grant or to receive any benefit in
lieu of a Grant hereunder, nor to have any special tax treatment apply to any
Grant.

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11.      GENERAL PROVISIONS.

         (a) Transfer of Grants. Only a Grantee or his or her authorized legal
representative or valid transferee may exercise rights under a Grant. Such
persons may not transfer those rights. Except as set forth below, the rights
under a Grant may not be disposed of by transfer, alienation, pledge,
encumbrance, assignment, or any other means, whether voluntary, involuntary, or
by operation of law, and any such attempted disposition shall be void.
Notwithstanding the foregoing and solely to the extent permitted by the
Committee in an agreement relating to a Grant, rights under a Grant (other than
pursuant to an Incentive Stock Option) may be transferred to members of a
Grantee's immediate family, charitable institutions, or trusts or partnerships
whose beneficiaries are any of the foregoing, or to such other persons or
entities as may be approved by the Committee, in each case subject to the
condition that the Committee be satisfied that such transfer is being made for
estate or tax planning purposes or for donative purposes without consideration
being received therefor. In addition, when a Grantee dies, the personal
representative or other person entitled to succeed to the rights of the Grantee
may exercise the rights. A successor to the rights under a Grant pursuant to the
foregoing ("Successor Grantee") must furnish proof satisfactory to the Company
of his or her right to receive the Grant, whether as a result of a transfer from
the Grantee, under the Grantee's will or under the applicable laws of descent
and distribution.

         (b) Substitute Grants. The Committee may make a Grant to an employee of
another corporation who becomes an Eligible Person by reason of a corporate
merger, consolidation, acquisition of stock or property, reorganization or
liquidation involving the Company in substitution for a stock option,
performance award, or restricted stock grant granted by such other corporation
("Substituted Stock Incentive"). The terms and conditions of the substitute
Grant may vary from the terms and conditions required by the 1994 Plan and from
those of the Substituted Stock Incentives. The Committee shall prescribe the
exact provisions of the substitute Grants, preserving to the extent the
Committee deems practical the provisions of the Substituted Stock Incentives.
The Committee shall also determine the number of shares of Guidant Stock to be
taken into account under Section 4.

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         (c) Subsidiaries. The term "subsidiary" means a corporation of which
Guidant owns directly or indirectly 50% or more of the voting power.

         (d) Fractional Shares. Fractional shares shall not be issued or
transferred under a Grant, but the Committee may pay cash in lieu of a fraction
or round the fraction.

         (e) Compliance with Law. The 1994 Plan, the exercise of Grants, and the
obligations of the Company to issue or transfer shares of Guidant Stock under
Grants shall be subject to all applicable laws and regulations and to approvals
by any governmental or regulatory agency as may be required. The Committee may
revoke any Grant if it is contrary to law or modify a Grant to bring it into
compliance with any valid and mandatory law or governmental regulation. The
Committee may also adopt rules regarding the withholding of taxes on payment to
Grantees.

         (f) Ownership of Stock. A Grantee or Successor Grantee shall have no
rights as a stockholder of the Company with respect to any shares of Guidant
Stock covered by a Grant until the shares are issued or transferred to the
Grantee or Successor Grantee on the Company's books.

         (g) No Right to Employment. The 1994 Plan and the Grants under it shall
not confer upon any Grantee the right to continue in the employment of the
Company or affect in any way the right of the Company to terminate the
employment of a Grantee at any time, with or without notice or cause.

         (h) Foreign Jurisdictions. The Committee may adopt, amend, and
terminate such arrangements, not inconsistent with the intent of the 1994 Plan,
as it may deem necessary or desirable to make available tax or other benefits of
the laws of foreign jurisdictions to Grantees who are subject to such laws.

         (i) Governing Law. The 1994 Plan and all Grants made under it shall be
governed by and interpreted in accordance with the laws of the State of Indiana,
regardless of the laws that might otherwise govern under applicable Indiana
conflict-of-laws principles.

         (j) Effective Date of the 1994 Plan. The 1994 Plan shall become
effective on October 17, 1994.

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                                                                   EXHIBIT 10.22

                               GUIDANT CORPORATION

                1996 Nonemployee Directors Stock Plan, As Amended

                                   ARTICLE I

                                     PURPOSE

                   1.1 This Guidant Corporation 1996 Nonemployee Directors Stock
Plan is intended to advance the interests of Guidant Corporation and its
shareholders by attracting, retaining and motivating the performance of
nonemployee directors of Guidant Corporation and to encourage and enable such
directors to acquire and retain a proprietary interest in Guidant Corporation by
ownership of its stock.

                                   ARTICLE II

                                   DEFINITIONS

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

                   2.2 "Code" means the Internal Revenue Code of 1986, as
amended.

                   2.3 "Common Stock" means the Company's common stock.

                   2.4 "Company" means Guidant Corporation.

                   2.5 "Date of Grant" means the date on which an option is
granted in accordance with Section 3.3 or Section 5.1 hereof or a Restricted
Stock Award is granted in accordance with Section 6.1 hereof.

                   2.6 "Disability" means a permanent and total disability
within the meaning of Section 22(e)(3) of the Code.

                   2.7 "Exchange Act" means the Securities Exchange Act of 1934,
as amended.

                   2.8 "Fair Market Value" means the average of the highest and
lowest sale prices of a share of Common Stock on the New York Stock Exchange
(NYSE) on the date as of which fair market value is to be determined or, in the
absence of any reported sales of Common Stock on such date, on the first
preceding date on which any such sale shall have been reported. If Common Stock
is not listed on the NYSE on the date as of which fair market value is to be
determined, the Board shall determine in good faith the fair market value in
whatever manner it considers appropriate.

                   2.9 "Grant" means the Options and Restricted Stock Awards
granted to a Grantee under the Plan.

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                   2.10 "Grantee" means a person to whom an Option or a
Restricted Stock Award has been granted under the Plan.

                   2.11 "Nonemployee Director" means any member of the Board who
is not an employee of the Company.

                   2.12 "Option" means a stock option granted under the Plan.

                   2.13 "Option Price" means the price at which each share of
Common Stock subject to an Option may be purchased, determined in accordance
with Section 3.3 or Section 5.2 hereof.

                   2.14 "Plan" means this Guidant Corporation 1996 Nonemployee
Directors Stock Plan, as amended.

                   2.15 "Restricted Stock Award" means an award of Common Stock
granted under the Plan and subject to the restrictions set forth herein.

                   2.16 "Restricted Stock Notice" means a notification by the
Company to a Grantee pursuant to which Common Stock will be issued or
transferred to a Grantee under the Plan.

                   2.17 "Rule 16b-3" means Rule 16b-3 under the Securities
Exchange Act of 1934, as amended.

                   2.18 "Stock Option Notice" means a notification by the
Company to a Grantee pursuant to which a Grantee may purchase Common Stock under
the Plan.

                                  ARTICLE III

                             ADMINISTRATION; GRANTS

                   3.1 Board Authority. Subject to the express provisions of the
Plan, the Board shall have discretionary authority to interpret the Plan, to
prescribe, amend and rescind rules and regulations relating to it, to determine
the details and provisions of each Stock Option Notice and Restricted Stock
Notice, and to make all the determinations necessary or advisable in the
administration of the Plan. All such actions and determinations by the Board
shall be conclusively binding for all purposes and upon all persons. The Board
shall not be liable for any action or determination made in good faith with
respect to the Plan, any Option or Restricted Stock Award or any Stock Option
Notice or Restricted Stock Notice entered into hereunder.

                   3.2 Annual Retainer Grants. Commencing with the 2000 annual
meeting of the Company's shareholders and on the date of each annual meeting
thereafter, each Nonemployee Director who is a member of the Board immediately
following each such annual meeting shall receive a grant of either (i) an Option
to purchase 10,000 shares of Common Stock in accordance with the provisions of
Article V hereof or (ii) at the election of the Nonemployee Director and in lieu
of the grant referred to in Section 3.2(i) above, (a) an Option to purchase
4,000 shares of Common Stock in

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accordance with the provisions of Article V hereof and (b) a Restricted Stock
Award in accordance with the provisions of Article VI hereof.

                   3.3 Discretionary Option Grants. The Board may make
discretionary Grants of Options to any Nonemployee Director in accordance with
the provisions of this Section 3.3. The Board shall select the persons who will
receive Options under this Section 3.3 from among the Nonemployee Directors and
determine the number of shares subject to any particular Option. The Option
Price of each share of Common Stock subject to an Option under this Section 3.3
shall be 100 percent of the Fair Market Value of a share of Common Stock on the
Date of Grant. The Board shall determine the exercise period of each Option
granted under this Section 3.3 which shall not exceed ten years from the Date of
Grant. Such exercise period shall be set forth in the related Stock Option
Notice which shall be prepared and delivered as provided in the last sentence of
Section 5.1 hereof. A Grantee may exercise an Option granted under this Section
3.3 in the manner and in accordance with the provisions set forth in Section 5.5
hereof.

                                   ARTICLE IV

                         SHARES OF STOCK SUBJECT TO PLAN

                   4.1 Number of Shares. Subject to adjustment pursuant to the
provisions of this Article IV, the maximum number of shares of Common Stock
which may be issued and sold hereunder shall be 250,000(1) shares. Shares of
Common Stock issued and sold under the Plan may be either authorized but
unissued shares or shares held in the Company's treasury. Shares of Common Stock
covered by an Option that shall have been exercised shall not again be available
for grant. If an Option shall terminate for any reason without being wholly
exercised, the number of shares to which such Option termination relates shall
again be available for grant hereunder. Shares of Common Stock covered by a
Restricted Stock Award for which the restrictions have lapsed shall not again be
available for grant. If a Restricted Stock Award shall terminate for any reason
prior to the time its restrictions shall have lapsed, the number of shares to
which such Restricted Stock Award relates shall again be available for grant
hereunder.

                   4.2 Antidilution. If any subdivision or combination of shares
of Common Stock or any stock dividend, reorganization, recapitalization, or
consolidation or merger with the Company as the surviving corporation occurs, or
if additional shares or new or different shares or other securities of the
Company or any other issuer are distributed with respect to the shares of Common
Stock through a spin-off, exchange offer, or other extraordinary distribution,
the Board shall make such adjustments as it determines appropriate in the number
of shares of Common Stock that may be issued or transferred in the future under
Articles III, V and VI. The Board shall also adjust as it determines appropriate
the number of shares and Option Price in outstanding Grants made before the
event.

----------------------
         (1) This is the original number of shares authorized for the Plan in
1996. It does not reflect subsequent stock splits.

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                                   ARTICLE V

                             ANNUAL RETAINER OPTIONS

                   5.1 Grant of Option. Commencing with the 2000 annual meeting
of the Company's shareholders and on the date of each annual meeting thereafter,
each Nonemployee Director who is a member of the Board immediately following
each such annual meeting shall receive a grant of an Option to purchase Common
Stock as determined in accordance with Section 3.2 hereof. The Company shall
deliver to the Grantee a Stock Option Notice which shall set forth such terms
and conditions of the Option as may be determined by the Board to be consistent
with the Plan, and which may include additional provisions and restrictions that
are not inconsistent with the Plan.

                   5.2 Option Price. The Option Price of each share of Common
Stock subject to an Option shall be 100 percent of the Fair Market Value of a
share of Common Stock on the Date of Grant.

                   5.3 Vesting; Term of Option. An Option granted under Section
5.1 hereof shall vest and become fully exercisable on the first date following
the Date of Grant on which is held the annual meeting of the shareholders of the
Company, provided that the Grantee is a member of the Board immediately
preceding such annual meeting. In the event of the Grantee's death or
Disability, an Option shall become fully vested and immediately exercisable. The
period during which a vested Option may be exercised shall be ten years from the
Date of Grant, subject to Section 5.4 hereof.

                   5.4 Termination of Option. A vested Option granted under
Section 5.1 hereof may be exercised prior to the Termination Date. The
Termination Date shall be the earliest to occur of (i) ten years from the Date
of Grant; (ii) the day of resignation or removal from the Board, except by
reason of (a) death, (b) retirement from the Board, or (c) Disability; (iii) the
corresponding calendar day in the sixtieth month following (a) the date the
Grantee retires from the Board or (b) the day on which the Grantee's seat on the
Board is terminated by reason of Disability, or on the last day of that sixtieth
month if there is no corresponding day in that month; or (iv) the corresponding
calendar day in the sixtieth month following the date of death of the Grantee
while an active member of the Board or on the last day of that sixtieth month if
there is no corresponding day in that month.

                   5.5 Option Exercise. A Grantee may exercise an Option by
delivering notice of exercise to the Company or its representative as designated
by the Board, either with or without accompanying payment of the Option Price.
The notice of exercise, once delivered, shall be irrevocable. The Grantee shall
pay or cause to be paid the Option Price in cash, or with the Board's
permission, by delivering shares of Common Stock already owned by the Grantee
and having a fair market value on the date of exercise equal to the Option
Price, or a combination of cash and shares. In addition, the Board may permit
the exercise of an Option by delivery of written notice, subject to the
Company's receipt of a third-party payment in full in cash for the Option Price
prior to the issuance of Common Stock, in the manner and subject to the
procedures as may be established by the Board. Unless the Board establishes a
shorter period which is set forth in the Stock Option Notice, the Grantee shall
pay the Option Price not later than 30 days

                                       4
<PAGE>   5

after the date of a statement from the Company following exercise setting forth
the Option Price, fair market value of Common Stock on the exercise date, the
number of shares of Common Stock that may be delivered in payment of the Option
Price, and the amount of withholding tax due, if any. If the Grantee fails to
pay the Option Price within the specified period, the Board shall have the right
to take whatever action it deems appropriate, including voiding the Option
exercise. The Company shall not issue or transfer shares of Common Stock upon
exercise of an Option until the Option Price is fully paid.

                                   ARTICLE VI

                             RESTRICTED STOCK AWARDS

                   6.1 Restricted Stock Award. Commencing with the 2000 annual
meeting of the Company's shareholders and on the date of each annual meeting
thereafter, each Nonemployee Director who is a member of the Board immediately
following each such annual meeting and who made the election provided for in
Section 3.2(ii) hereof shall receive a grant of a Restricted Stock Award for a
number of shares of Common Stock determined by dividing $50,000 by the Fair
Market Value of a share of Common Stock on the date of such annual meeting, with
such resulting number to be rounded upwards to the nearest increment of ten
shares. The Company shall deliver to the Grantee a Restricted Stock Notice which
shall set forth such terms and conditions of the Restricted Stock Award as may
be determined by the Board to be consistent with the Plan, and which may include
additional provisions and restrictions that are not inconsistent with the Plan.
Upon the issuance or transfer of a Restricted Stock Award, the Grantee shall be
entitled to vote the shares and to receive any dividends paid thereon.

                   6.2 Restriction Period. The rights of a Grantee in respect of
a Restricted Stock Award shall be subject to a "Restriction Period" (after which
restrictions shall lapse), which shall mean a period commencing on the Date of
Grant and ending on the first date following the Date of Grant on which is held
the annual meeting of the shareholders of the Company, provided that the Grantee
is a member of the Board immediately preceding such annual meeting.

                   6.3 Requirement of Service. If the Grantee's service as a
member of the Board is terminated for any reason during the Restriction Period,
the Restricted Stock Award shall terminate and the shares of Common Stock must
be returned immediately to the Company; provided, however, the Restriction
Period for any Restricted Stock Award shall expire and all restrictions shall
lapse upon the Grantee's death or Disability.

                   6.4 Restrictions on Transfer and Legend on Stock Certificate.
During the Restriction Period, a Grantee may not sell, assign, transfer, pledge,
or otherwise dispose of the shares of Common Stock except in accordance with
Section 9.1 hereof. Each certificate for shares issued or transferred under a
Restricted Stock Award shall be held in escrow by the Company until the
expiration of the Restriction Period.

                   6.5 Lapse of Restrictions. All restrictions imposed under the
Restricted Stock Award shall lapse (i) upon the expiration of the Restriction
Period if all conditions

                                       5
<PAGE>   6

stated in Sections 6.3 and 6.4 have been met or (ii) as provided under Section
7.1(b). The Grantee shall then be entitled to delivery of the certificate.

                                  ARTICLE VII

                                CHANGE OF CONTROL

                   7.1 Effect of Grants. Unless the Board shall otherwise
expressly provide in the agreement relating to a Grant, upon the occurrence of a
Change of Control (as defined below):

                           (a) Each outstanding Option that is not then fully
         exercisable shall automatically become immediately and fully
         exercisable and shall remain exercisable until the termination of the
         Option exercise period applicable to the Option under Section 3.3 or
         Article V as the case may be; and

                           (b) The Restriction Period on an outstanding
         Restricted Stock Award shall automatically expire and all restrictions
         imposed under such Restricted Stock Award shall immediately lapse.

                  7.2 Change of Control. For purposes of the Plan, a Change of
Control shall mean the happening of any of the following events:

                           (a) The acquisition by any "person," as that term is
         used in Sections 13(d) and 14 (d) of the Exchange Act (other than (i)
         the Company, (ii) any subsidiary of the Company, (iii) any employee or
         directors' benefit plan or stock plan of the Company or a subsidiary of
         the Company, or any trustee or fiduciary with respect to any such plan
         when acting in that capacity, or (iv) any person who acquires such
         shares pursuant to a transaction or series of transactions approved
         prior to such transaction(s) by the Board) of "beneficial ownership,"
         as defined in Rule 13d-3 under the Exchange Act, directly or
         indirectly, of 20% or more of the shares of the Company's capital
         stock, the holders of which have general voting power under ordinary
         circumstances to elect at least a majority of the Board (or which would
         have such voting power but for the application of the Indiana Control
         Share Statute) ("Voting Stock");

                           (b) the first day on which less than two-thirds of
         the total membership of the Board shall be Continuing Directors (as
         that term is defined in Article 6(f) of the Company's Amended and
         Restated Articles of Incorporation);

                           (c) approval by the shareholders of the Company of a
         merger, share exchange, or consolidation of the Company (a
         "Transaction"), other than a Transaction which would result in the
         Voting Stock of the Company outstanding immediately prior thereto
         continuing to represent (either by remaining outstanding or by being
         converted into voting securities of the surviving entity) more than 50%
         of the Voting Stock of the Company or such surviving entity immediately
         after such Transaction; or

                                       6
<PAGE>   7

                           (d) approval by the shareholders of the Company of a
         complete liquidation of the Company or a sale or disposition of all or
         substantially all the assets of the Company.

For purposes hereof, the term "subsidiary" means a corporation of which the
Company owns directly or indirectly 50% or more of the voting power.

                                  ARTICLE VIII

                    EFFECTIVE DATE, TERMINATION AND AMENDMENT

                  8.1 Effective Date. The Plan shall become effective after its
adoption by the Board and on the date of its approval by the affirmative votes
of the shareholders of the Company present, or represented, and entitled to vote
at a meeting duly held in accordance with applicable state law and the Articles
of Incorporation and By-laws of the Company.

                  8.2 Termination. The Plan shall terminate on the date
following the date of the 2006 Annual Meeting of Shareholders of the Company.
The Board may, in its sole discretion and at any earlier date, terminate the
Plan. Notwithstanding the foregoing, no termination of the Plan shall in any
manner affect any Grant theretofore granted without the consent of the Grantee
or the permitted transferee of the Grant.

                  8.3 Amendment. The Board may at any time and from time to time
and in any respect, amend or modify the Plan; provided, however, that, solely to
the extent necessary to comply with Rule 16b-3 (i) the Board may not act more
than once every six months to amend the provisions of the Plan relating to the
determination of the amount, price or timing of any Grant under the Plan; and
(ii) the approval of the Company's shareholders will be required for any
amendment that (a) changes the class of persons eligible for the Grants, (b)
increases (other than as described in Section 4.2 hereof) the maximum number of
shares of Common Stock subject to grant under the Plan, as specified in Section
4.1 hereof, or (c) materially increases the benefits accruing to Grantees under
the Plan, within the meaning of Rule 16b-3. Any such approval shall be by the
affirmative votes of the shareholders of the Company present, or represented,
and entitled to vote at a meeting duly held in accordance with applicable state
law and the Articles of Incorporation and By-laws of the Company.
Notwithstanding the foregoing, no amendment or modification of the Plan shall in
any manner affect any Grant theretofore granted without the consent of the
Grantee or the permitted transferee of the Grant.

                                       7
<PAGE>   8

                                   ARTICLE IX

                                  MISCELLANEOUS

                  9.1 Nontransferability of Grant. No Grant shall be transferred
by a Grantee other than by will or the laws of descent and distribution. No
transfer of a Grant by the Grantee by will or by laws of descent and
distribution shall be effective to bind the Company unless the Company shall
have been furnished with written notice thereof and an authenticated copy of the
will and/or such other evidence as the Board may deem necessary to establish the
validity of the transfer. During the lifetime of the Grantee, the Grant shall be
exercisable only by such Grantee, except that, in the case of a Grantee who is
legally incapacitated, the Grant shall be exercisable by the Grantee's guardian
or legal representative.

                  9.2 Rights as Shareholder. A Grantee or the permitted
transferee of a Grant shall have no rights as a shareholder with respect to any
shares subject to such Grant prior to the purchase of such shares by exercise of
an Option, or with respect to a Restricted Stock Award prior to the lapse of the
restrictions, except as provided herein or in the applicable Stock Option Notice
or Restricted Stock Notice. Nothing contained herein, or in the Stock Option
Notice or Restricted Stock Notice relating to any Grant shall create an
obligation on the part of the Company to repurchase any shares of Common Stock
purchased hereunder.

                  9.3 Service on Board. Nothing in the Plan, in the grant of any
Option or Restricted Stock Award or in any Stock Option Notice or Restricted
Stock Notice shall confer upon any Nonemployee Director the right to continue
service as a member of the Board.

                  9.4 Compliance with Law. The Plan, the exercise of Grants, and
the obligations of the Company to issue or transfer shares of Common Stock under
Grants shall be subject to all applicable laws and regulations and to approvals
by any governmental or regulatory agency as may be required. The Board may
revoke any Grant if it is contrary to law or modify a Grant to bring it into
compliance with any valid and mandatory law or government regulation.

                  9.5 Section 83(b) Election. If a Grantee shall make an
election pursuant to Section 83(b) of the Code with respect to a Restricted
Stock Award, the Grantee shall, within 30 days following the Date of Grant,
furnish to the Company a copy of such election.

                  9.6 Plan Binding on Successors. The Plan shall be binding upon
the Company, its successors and assigns, and the Grantee, the Grantee's
executor, administrator and permitted transferee.

                  9.7 Construction and Interpretation. Whenever used herein,
nouns in the singular shall include the plural, and the masculine pronoun shall
include the feminine gender. Headings of Articles and Sections hereof are
inserted for convenience and reference and constitute no part of the Plan.

                  9.8 Severability. If any provision of the Plan or any Stock
Option Notice or Restricted Stock Notice 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.

                  9.9 Governing Law. The validity and construction of this Plan
and of any Stock Option Notice or Restricted Stock Notice shall be governed by
the laws of the State of Indiana.

                                       8

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