ATRI ATRION Corporation

On May 23, 2023, the Board of Directors of the Registrant, upon the recommendation of the Compensation Committee of the Board of Directors approved and adopted the Atrion Corporation 2023 Annual Incentive Compensation Plan (the "Plan"). The purpose of the Plan is to enable the Registrant to attract and retain employees, including named executive officers, by providing a competitive cash bonus program that rewards outstanding performance. The Plan is intended to replace the Short-Term Incentive Compensation Plan adopted in 2013 for awards granted in 2023 and thereafter.

Pursuant to the Plan, executive officers of the Registrant and salaried employees of the Registrant and its subsidiaries will be eligible to receive compensation based on attainment of certain performance goals ("Performance Goals"). The Administrator (the Compensation Committee or its delegee) will determine the individuals that may participate in the Plan, select the period for which performance is calculated, and establish Performance Goals for each participant.

Performance Goals will be based upon one or more performance criteria selected by the Administrator, each of which may carry a different weight and may differ from participant to participant. Performance criteria may include the following business criteria, either individually, alternatively, or in any combination, applied to either the Registrant as a whole or to a business unit or subsidiary, either individually, alternatively, or in any combination, and measured either annually or cumulatively over a period of years, on an absolute basis or relative to a pre-established target, to previous years’ results, or to a designated comparison peer group, in each case as specified by the Administrator: (i) gross sales or net sales; (ii) gross margin or cost of goods sold; (iii) selling, general and administrative expenses; (iv) operating income, earnings from operations, earnings before or after taxes, or earnings before or after interest, depreciation, amortization, or extraordinary or special items; (v) net income or net income per basic or diluted share of common stock; (vi) return on assets, return on invested capital, or return on equity; (vii) cash flow, free cash flow, cash flow return on investment, or net cash provided by operations; (viii) economic profit or economic value created; (ix) stock price or total stockholder return; (x) staffing, diversity, training and development, succession planning, and employee satisfaction; (xi) acquisitions or divestitures of subsidiaries, affiliates, or joint ventures; (xii) safety; and (xiii) such other objective or subjective performance criteria as the Administrator may determine. Following the completion of the applicable performance period, the Administrator will assess and certify the extent that the Performance Goals were achieved or exceeded, and determine the payment for each participant, if any.

The foregoing summary of the Plan does not purport to be complete and is qualified in its entirety by reference to the full text of the Plan, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K.