EX-10.14 6 file006.htm STOCK OPTION AND INCENTIVE PLAN


                                                                   Exhibit 10.14

          AMENDED AND RESTATED 2000 STOCK OPTION AND INCENTIVE PLAN OF
                    NON-EMPLOYEE DIRECTORS AND CONSULTANTS OF

                                ORTHOMETRIX, INC.

         1. DEFINITIONS.

         "Board of Directors" shall mean the Board of Directors of the
Corporation as constituted from time to time or a committee of the Board of
Directors to which responsibility for the administration of the Plan has been
delegated.

         "Cancellation Notice" shall mean the notice given by the Corporation to
an Optionee pursuant to Section 14(b) hereof notifying him of the cancellation
of this Option.

         "Cash Payment Election" shall mean the right described in Section 6
hereof of an Optionee to elect to receive cash upon exercise of an Option.

         "Code" Shall mean the Internal Revenue Code of 1986, as amended.

         "Common Stock" shall mean shares of common stock of the Corporation,
         par value $0.005 per share.

         "Corporation" shall mean ORTHOMETRIX, INC., a Delaware corporation.

         "Exchange Act" shall mean the Securities Exchange Act of 1934.

         "Exercise Price per Share" with respect to an Option shall be the fair
market value of such shares on the last trading day prior to the date of grant
of such options.

         "Fair Market Value per Share" at any particular Date shall mean the
fair value of a share of Common Stock as determined in good faith by the Board
of Directors. In the case of an Incentive Stock Option, such determination
shall be made consistent with Section 422(c)(8) of the Code.

         "Incentive Stock Option" shall mean a stock option granted to an
Optionee hereunder which qualifies as an "incentive stock option" within the
meaning of Section 422 of the Code.

         "Non-qualified Stock Option" shall mean a stock option granted to an
Optionee hereunder which does not qualify as an "incentive stock option" under
Section 422 of the Code.

         "Option" shall mean either an Incentive Stock Option or a Non-qualified
Stock Option.

         "Option Agreement" shall mean the agreement between the Corporation and
an Optionee evidencing the grant of an Option pursuant to the Plan and setting
forth the terms and conditions of the Option. "Optionee" shall mean a person
to whom an Option has been granted pursuant to the Plan. "Plan" shall mean
this Amended and Restated 2000 Stock Option and Incentive Plan for
Non-Employee Directors and Consultants of the Corporation, as amended and
restated from time to time. "Shares" shall mean the shares of Common Stock
which may be issued pursuant to the Plan.

         2. PURPOSE OF THE PLAN.

         The purpose of the Plan is to secure for the Corporation and its
shareholders the benefits arising from capital stock ownership by non-employee
Directors and Consultants of the Corporation who are expected to contribute to
the Corporation's future growth and success.

                                    29 of 34


                                                                   EXHIBIT 10.14

         3. ADMINISTRATION.

         The Plan shall be administered by the Board of Directors. Subject to
the express provisions of the Plan, the Board of Directors shall have plenary
authority to interpret the Plan, to prescribe, amend and rescind rules and
regulations relating to it, to determine the terms and provisions of the
respective Option Agreements (which need not be identical) and to make all other
determinations necessary or advisable for the administration of the Plan except
that the approval of the stockholders is necessary to increase the total number
of shares which may be issued or transferred under the plan and to change the
minimum purchase price for shares subject to option. To the extent necessary to
comply with Rule 16b-3 under the Exchange Act, determinations concerning Options
granted to any director or officer shall be made by a committee of the Board,
all of whose members are "disinterested persons" within the meaning of Rule
16b-3 under the Exchange Act.

          4. NUMBER SHARES.

         The aggregate number of Shares for which Options may be granted under
the Plan is 1,500,000 Shares, subject to adjustment in accordance with Section
11 hereof. Shares covered by the unexercised portions of any terminated or
canceled Options shall be available to become subject to Options granted
thereafter. Shares subject to the portions of Options which are surrendered in
connection with the exercise by Optionees of Cash Payment Elections shall not be
available to become subject to Options granted thereafter. Upon the exercise of
an Option, the number of shares with respect to which the Option may thereafter
be exercised by the Optionee shall no longer include the sum of the Shares
purchased upon exercise plus the Shares, if any, covered by a Cash Payment
Election upon such exercise.

         5. GRANT OF OPTIONS.

         Each non-employee Director was granted options under this plan for
50,000 shares on June 2, 1999, subject to shareholder approval, for services
rendered during 1999. Any person who is elected a non-employee Director will be
granted options under this plan for 50,000 Shares as of the date of first
election. Options for an additional 5,000 shares of Common Stock will be
automatically granted under the Plan to each person who is re-elected a
non-employee Director on the date of the Annual Meeting of Shareholders of the
Company in each of the years 2000 and beyond.

         Each grant of an Option shall be evidenced by an Option Agreement
between the Optionee and the Corporation. Each Option Agreement shall specify
the number of Shares covered by such Option and the Exercise Price per Share.
The Option Agreement shall also contain such terms and conditions not
inconsistent with the Plan as the Board of Directors in sole discretion shall
deem appropriate (which terms and conditions need not be the same in each Option
Agreement and may be changed from time to time). Each Option Agreement may
require as conditions of exercise that the Optionee provide such investment
representations with respect to, and enter into such agreements concerning the
sale and transfer of, the Shares received by the Optionee upon exercise, as the
Board of Directors shall deem appropriate. Each Option Agreement for a
Non-qualified Option shall provide for the withholding of income taxes and
employment taxes that the Corporation determined it is required to withhold upon
the exercise of an Option.

                                    30 of 34


                                                                   EXHIBIT 10.14

         6. TERM OF OPTION.

         Each Option Agreement shall specify the Date or Dates on which the
Option granted thereunder may be exercised. Each Option Agreement will provide
for the exercise of the Option in four equal annual installments on such terms
and conditions as the Board of Directors may determine. The period of each
Option shall be fixed by the Board of Directors but in no case shall exceed
after the Date ten (10) years and one (1) month.

         7. NON-TRANSFERABILITY OF OPTION RIGHTS.

         Options and Cash Payment Elections shall not be transferable except by
will or the laws of descent and distribution. During the lifetime of an
Optionee, each Optionee's Options and Cash Payment Elections shall be
exercisable only by the Optionee.

          8. EFFECT OF DEATH OR TERMINATION OF DIRECTORSHIP.

         (a) Except as otherwise determined by the Board of Directors, upon the
termination of directorship of any Optionee (for any reason other than death),
all rights under any Option held by such Optionee shall cease; provided,
however, that the Option Agreement may provide that the rights which were
immediately exercisable by the Optionee at the Date of such termination of
directorship or consultancy may be exercised by the Optionee subject to such
conditions, provisions or limitations as may be set forth in the Option
Agreement, during a period not exceeding three (3) months after the Date of such
termination, but in no case after the Date on which the Option otherwise would
have expired but for the Optionee's termination of directorship or consultancy.

         (b) Except as otherwise determined by the Board of Directors, upon the
termination of any Optionee by reason of his death, if during such period the
Optionee was entitled pursuant to the express terms of an Option Agreement to
exercise his rights under such Option Agreement, all rights under any Option
held by such Optionee shall cease; provided, however, that the Option Agreement
may provide that the rights which were immediately exercisable by the Optionee
at the Date of his death may be exercised by legal representatives or
beneficiaries of the Optionee during the period specified in the Option
Agreement, not exceeding one (1) year after the Date of the Optionee's death.

         9. EXERCISE AND WITHHOLDING.

         (a) The purchase price of the Shares as to which an Option shall be
exercised plus any required Federal income tax or other withholding amount shall
be paid in cash or by certified check, provided that, the Board of Directors
shall have discretion in connection with any exercise of an Option to allow the
Optionees to pay all or a portion of the aggregate exercise price of all Options
being exercised plus applicable withholding amounts by transferring to the
Corporation previously acquired Shares having an aggregate fair market value
equal to such amount, or portion thereof. The Corporation shall not be required
to deliver certificates for such Shares until such payment has been made.

         (b) The Corporation shall have the right to deduct from all amounts
paid in cash any taxes required by law to be withheld therefrom.

         (c) Subject to the Prior approval of the Board of Directors, the
Optionee may satisfy all or a portion of the withholding tax obligation
hereunder by having the Corporation withhold Shares having a Fair Market Value
on the Date the amount to be withheld is to be determined (the "Tax Date") equal
to the amount required by law to be withheld from such

                                    31 of 34


                                                                   EXHIBIT 10.14

distribution. In lieu thereof, the Corporation shall have the right to retain or
sell without notice a sufficient number of Shares to cover the amount required
to be withheld.

         10. STOCK DIVIDEND, MERGER, CONSOLIDATION, ETC.

         Each Option Agreement may contain such provisions concerning
adjustments in the number or kind of Shares or other securities allocated to
unexercised Options granted prior to and in the event of one (1) or more stock
dividends, stock splits, reorganizations, recapitalizations, combinations of
shares, mergers, consolidations, or other changes in the corporate structure of
stock of the Corporation, or any transaction involving the Corporation as the
Board of Directors may deem appropriate. Such adjustment shall be binding and
conclusive for all purposes.

         11. RIGHTS AS A SHAREHOLDER.

         An Optionee shall have no rights as a shareholder with respect to any
Shares covered by an Option until such Optionee shall have become the holder or
record of any such Share.

         12. DETERMINATIONS.

         Each determination, interpretation or other action made or taken
pursuant to the provisions of the Plan by the Board of Directors, and each
determination of Fair Market Value per Share shall be final and conclusive for
all purposes and shall be binding upon all persons, including, without
limitation, the Corporation and all Optionees, and their respective successors
and assigns.

         13. AMENDMENT, TERMINATION AND MODIFICATION OF THE PLAN AND AGREEMENTS.

         (a) The Board of Directors may alter, amend, suspend, discontinue or
terminate the Plan at any time; provided, however, that no such action shall
adversely affect the rights of Optionees to Options previously granted hereunder
and, provided further, however, that any stockholder approval necessary or
desirable in order to comply with Rule 16b-3 under the Exchange Act, Section 422
of the Code (or other applicable law or regulation) shall be obtained in the
manner required therein.

         (b) Notwithstanding the foregoing provisions of this Section 14, each
Option Agreement may provide that the Corporation shall have the right to
terminate the rights of any Optionee to exercise any options, effective not less
than thirty (30) days after receipt by the Optionee of a Cancellation Notice
from the Corporation. The Corporation may issue a Cancellation Notice only in
connection with (i) the sale of substantially all of the Corporation's assets,
or (ii) a merger, consolidation or other corporate transaction in which the
Corporation would not be the surviving entity. The Cancellation Notice shall
afford the Optionee the right to exercise all Options held by such Optionee with
respect to all Shares covered thereby (even if they would not otherwise have
become exercisable with respect to all such Shares at that time) during the
period prior to the Date of termination.

         (c) Notwithstanding the foregoing provisions of this Section 14, each
Option Agreement may contain the consent of the Optionee to any amendment to the
Plan and Option Agreement which the Board of Directors, in its sole discretion
and upon advice of legal counsel, may deem necessary or advisable to enable the
exercise of Options to comply with any applicable rules and regulations of the
Securities and Exchange Commission, including, without

                                    32 of 34


                                                                   EXHIBIT 10.14

intending any limitation, any amendment which would exempt such exercise from
the operation of Section 16 of the Securities Exchange Act of 1934.

         14. INCENTIVE STOCK OPTIONS.

         Incentive Stock Options shall be specifically designated as Incentive
Stock Options and shall be subject to the following additional terms and
conditions:

         (a) Dollar Limitation. The aggregate fair market value (determined as
of the respective Date or Dates of grant and consistent with Section 422(c)(8)
of the Code) of the Common Stock for which Incentive Stock Options (together
with incentive stock options under any other stock option plans of the
Corporation) which are first exercisable in any one (1) calendar year shall not
exceed the sum of $100,000. For purposes of the $100,000 limitation, if an
Option Agreement provides that the Option granted thereunder shall not be
treated as an Incentive Stock Option, such Option shall be disregarded. The
event that Section 422(b)(7) of the Code is amended to alter the limitation set
forth therein so that following such amendment such limitation shall differ from
the limitation set forth in this paragraph (a), the limitation of this paragraph
(a) shall be automatically adjusted accordingly.

          15. EFFECTIVE DATE.

         The Plan shall become effective when adopted by the Board of Directors,
but no Stock Option granted under the Plan shall become exercisable unless and
until the Plan shall have been approved by the Corporation's shareholders. If
such shareholder approval is not obtained within twelve (12) months after the
Date of the Board's adoption of the Plan, any Stock Options previously granted
under the Plan shall terminate, and no further Stock Options shall be granted.
Subject to this limitation, options may be granted under the Plan at any time
after the effective Date and before the Date fixed for termination of the Plan.

         16. COMPLIANCE.

         No share of Common Stock shall be issued hereunder unless counsel for
the Corporation shall be satisfied that such issuance will be in compliance with
applicable federal and state securities laws. The Board of Directors may, in its
discretion, require as a condition to the exercise of any Option that the Shares
reserved or issuance upon the exercise of the Option have been duly listed, upon
official notice of issuance, by any securities exchange upon which such shares
are then listed, if any, and either that (a) a Registration Statement under the
Securities Act of 1933, as amended, or any succeeding act, with respect to such
shares is effective at the time of such exercise or (b) there is an exemption
from registration under such Act for the issuance of shares upon such exercise.

         17. GOVERNING LAW.

         The Plan and all determinations made and actions taken pursuant thereto
shall be governed by the internal laws of the State of Delaware, the state where
the Corporation maintains its principal office and operations and constructed in
accordance therewith without giving effect to the principles of conflict of laws
thereof.

                                    33 of 34