Sample Business Contracts

Stock Option Agreement - Cerner Corp. and Michael E. Herman

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CERNER CORPORATION                                   PLAN D STOCK
                                                 OPTION AGREEMENT

THIS AGREEMENT, made and entered into this eighth day of
December, 1994 (the "Granting Date"), by and between CERNER
CORPORATION, a Delaware corporation (the "Company"), and Michael
E. Herman (the "Optionee"),


WHEREAS, the Stock Option Committee of the Board of Directors of
the Company (the "Committee") has determined that the Optionee is
eligible to receive an option to purchase shares of common stock
of the Company under the Company's Non-Qualified Stock Option
Plan (the "Plan");

NOW, THEREFORE, in consideration of the mutual promises and
covenants herein contained and other good and valuable
consideration, the parties hereto do hereby agree as follows:

  1. Incorporation of the Plan.  A copy of the Plan is
     incorporated herein by reference and all of the terms,
     conditions and provisions contained therein shall be deemed
     to be contained in this Agreement.

  2. Grant of Option.  Pursuant to the authorization of the
     Committee, and subject to the terms, conditions and
     provisions contained in this Agreement, the Company hereby
     grants to the Optionee an option (the "Option") to purchase
     from the Company all or any part of an aggregate of twenty-
     four thousand (24,000) shares of Cerner Common Stock at the
     purchase price of thirty-seven and three-fourths ($37 3/4)
     per share.
     The number of shares of common stock subject to the Option
     and the purchase price per share shall be appropriately
     adjusted to reflect any stock dividends, stock splits, split
     ups or combinations of outstanding shares of common stock of
     the Company.  The date first written above shall be deemed
     to be the granting date of this Option.
     This Option grant is made in conjunction with the role of
     Board of Director, currently performed by the Optionee as of
     the granting date.  The definition and responsibilities of
     this role will be based annually on the description
     incorporated in the then-current Incentive Plan
     documentation or comparable document.  Future vesting of
     shares granted in this Option will be evaluated as explained
     in paragraph 3.  Vesting will be contingent on continued
     performance of this role and other factors as determined by
     the President and Chairman of the Board of the Company.

  3. Term of Option:  Exercise in Installments.  This option
     shall expire with respect to all shares of Cerner Common
     Stock subject hereto twenty-five years from the date first
     above written (the "Expiration Date"), unless it shall be
     terminated at an earlier date in accordance with this
     Agreement.  This Option shall become exercisable in
     installments as follows, subject to the vesting provisions
     of paragraph 4:

            Number or Percentage     Earliest Date on
            of Shares Subject to      Which Shares May
               This Option              Be Purchased
            --------------------     -----------------
                    4,000               May 16, 1995
                    4,000               May 16, 1996
                    4,000               May 16, 1997
                    4,000               May 16, 1998
                    4,000               May 16, 1999
                    4,000               May 16, 2000

  4. Option Vesting.  The Optionee may purchase all or any
     portion of the shares subject to each installment listed
     above at any time on or after the exercise dates listed
     above and before the Expiration Date (or any earlier
     termination date) that have become "vested".  "Vested" means
     that a) the Optionee has continued to perform the role noted
     in paragraph 2, or an alternate role as assigned by the
     Chairman of the Board and President of the Company, b) that
     the Optionee's performance in the assigned role has been
     reviewed by the President and Chairman of the Board of the
     Company and such performance has been deemed commensurate
     with the role, and c) that they have issued a written
     statement to Optionee stating the amount of shares which are
     vested at each of the dates set forth above.
     Any shares which do not become so "vested" shall no longer
     be subject to this Option.  This Option shall expire as to
     any of such shares not so vested.  This Option shall expire
     as to all unexercised shares immediately upon termination of
     the Associate's employment with the Company or any of its
     subsidiaries, except that in the event such employment is
     terminated by reason of the Optionee's death or disability
     the Optionee, or Optionee's estate, shall have thirty (30)
     calendar days following such date to exercise this Option as
     to the number of shares exercisable on such date.
     This Option may be exercised by Optionee delivering to the
     Company a written notice of exercise along with a cash
     payment in the amount of the purchase price for such shares.
  5. Investment Purpose.  By accepting this Option, the Optionee
     agrees that any and all shares of stock purchased upon the
     exercise of this Option will be purchased for investment
     purposes, and not with a view to any distribution thereof,
     and that each notice of the exercise of any portion of this
     Option shall be accompanied by a representation in writing
     signed by the Optionee (or by the person or persons entitled
     to exercise the Option in the event of the death of the
     Optionee) that the share of stock are being purchased in
     good faith for personal investment purposes, and not with a
     view to any distribution thereof.
     When a registration statement filed with the Securities and
     Exchange Commission regarding the shares of common stock
     subject to this option agreement becomes effective, the
     investment representation contained in this paragraph will
     no longer be applicable.
  6. Stock Restrictions.  The Optionee further agrees that:

       (a)  Each stock certificate issued pursuant to the
       exercise of the Option granted hereby shall bear a legend
       to the effect that the shares represented thereby have
       not been registered under the Securities Act of 1933, and
       may not be transferred except in accordance with the
       provisions of this Agreement.
       (b)  The shares of the stock acquired upon the exercise
       of this Option may be transferred, in whole or in part,
       only if in the opinion of counsel for the Company such
       proposed transfer may be effected without registration
       under the Securities Act of 1933 and appropriate state
       securities laws or such registration has been effected.
       Prior to the transfer of any such shares the holder
       thereof shall furnish the Company written notice of the
       intention to effect such transfer, which notice shall
       include the manner and circumstances of the proposed
       transfer and such other matters as the Company may
       (c)  The Optionee shall promptly comply with any request
       by the Company for information concerning any disposition
       by the Optionee of any shares acquired pursuant to this
       Option which the Company may need in connection with an
       income tax return or any other return or report which it
       may be required to file with any governmental agency.
  7. Notices.  Any notices or other communications required or
     allowed to be made or given to the Company under the terms
     of this Agreement shall be addressed to the Company in care
     of its secretary at its offices at 2800 Rockcreek Parkway,
     North Kansas City, Missouri 64117, and any notice to be
     given to the Optionee shall be addressed to the Optionee at
     the address given beneath the signature hereto.  Either
     party hereto may from time to time change the address to
     which notices are to be sent to such party by giving written
     notice of such change to the other party.  Any notice
     hereunder shall be deemed to have been duly given if and
     when addressed as aforesaid, registered and deposited,
     postage and registry fee prepaid, in a post office regularly
     maintained by the United States Government.
  8. Binding Effect and Assignment.  This Agreement shall bind
     the parties hereto but shall not be assignable by either
     party without the express written consent of the other.
  9. Governing Law.  This Agreement shall be construed in
     accordance with the laws of the State of Missouri.

IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its officers hereunto duly authorized and its
corporate seal to be hereunto affixed, and the Optionee has
hereunto set hand as of the day and year first above written.

                              CERNER CORPORATION

                              By:/s/Neal L. Patterson

                                 Neal L. Patterson, Chairman


/s/Clifford W. Illig
Clifford W. Illig, President

                                /s/Michael E. Herman
                                Michael E. Herman

                       Address  6201 Ward Parkway   
                                Kansas City, MO 64113