Exhibit 10.2

 

Exhibit D

Officers

 

VARIAN MEDICAL SYSTEMS, INC.

2005 OMNIBUS STOCK PLAN

NONQUALIFIED STOCK OPTION AGREEMENT

 

Varian Medical Systems, Inc. (the “Company”) hereby grants you, «FNAME» «LNAME»
(the “Employee”), a nonqualified stock option under the Company’s 2005 Omnibus
Stock Plan (the ”Plan”), to purchase shares of common stock of the Company
(“Shares”).  The date of this Agreement is «GrantDate» (the “Grant Date”).  In
general, the latest date this option will expire is «ExpirationDate» (the
“Expiration Date”).  However, as provided in Appendix A (attached hereto as
“2005 Omnibus Stock Plan Appendix A”), this option may expire earlier than the
Expiration Date.  Subject to the provisions of Appendix A and of the Plan, the
principal features of this option are as follows:

 

Maximum Number of Shares

 

 

Purchasable with this Option:

 

Purchase Price per Share:

«Shares»

 

$

«GrantPrice»

 

Scheduled Vesting Dates:

 

Number of Shares*:

 

 

 

«Date1YearFromGrantDate»

 

1/3rd  of shares granted

«Date13thMonthFromGrantDate» through

 

1/36th  of shares granted

«Date36thMonthFromGrantDate»

 

 

 

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*Shares vest in only whole share increments, fractions of shares vest only when
they equal whole share increments.

 

Event Triggering

 

Maximum Time to Exercise

 

Termination of Option:

 

After Triggering Event**:

 

 

 

 

 

Termination of Service for cause

 

None

 

Termination of Service due to Disability

 

1 year

 

Termination of Service due to Retirement

 

3 years

 

Termination of Service due to death

 

3 years

 

All other Terminations of Service

 

3 months

 

 

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**However, in no event may this option be exercised after the Expiration Date
(except in certain cases of the death of the Employee).

 

Your signature below indicates your agreement and understanding that this option
is subject to all of the terms and conditions contained in Appendix A and the
Plan.  For example, important additional information on vesting and termination
of this option is contained in Paragraphs 4 through 6 of Appendix A. 
ACCORDINGLY, PLEASE BE SURE TO READ

 

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ALL OF APPENDIX A AND THE PLAN, WHICH CONTAINS THE SPECIFIC TERMS AND CONDITIONS
OF THIS OPTION. YOU CAN REQUEST A COPY OF THE PLAN BY CONTACTING THE CORPORATE
HUMAN RESOURCES OFFICE IN PALO ALTO, CALIFORNIA.

 

 

VARIAN MEDICAL SYSTEMS, INC.

EMPLOYEE

 

 

By:

 

 

 

 

 

 

Vice President, Human Resources

«FNAME» «LNAME»

 

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2005 STOCK PLAN APPENDIX A

 

TERMS AND CONDITIONS OF NONQUALIFIED STOCK OPTION

 

1.                                       Grant of Option.  The Company hereby
grants to the Employee under the Plan, as a separate incentive in connection
with his or her employment and not in lieu of any salary or other compensation
for his or her services, a nonqualified stock option to purchase, on the terms
and conditions set forth in this Agreement and the Plan, all or any part of an
aggregate of «Shares» Shares.

 

2.                                       Exercise Price.  The purchase price per
Share for this option (the “Exercise Price”) shall be $«GrantPrice» which is the
Fair Market Value of a Share on the Grant Date.

 

3.                                       Number of Shares.  The number and class
of Shares specified in Paragraph 1 above, and/or the Exercise Price, are subject
to adjustment by the Committee in the event of any merger, reorganization,
consolidation, recapitalization, separation, liquidation, stock dividend,
split-up, Share combination or other change in the corporate structure of the
Company affecting the Shares.

 

4.                                       Vesting Schedule.  Except as otherwise
provided in this Agreement, the right to exercise this option will vest as to
thirty-three and one-third percent (33-1/3%) of the Shares specified in
Paragraph 1 above on the first anniversary date of the Grant Date, and as to an
additional 1/36th of the shares on each succeeding monthly anniversary date,
until the right to exercise this option shall have vested with respect to one
hundred percent (100%) of such Shares.  On any scheduled vesting date, vesting
actually will occur only if the Employee has been continuously employed by the
Company or an Affiliate from the Grant Date until such scheduled vesting date,
or the vesting date occurs within three (3) years following the employees
termination of service due to the Employee’s Retirement.  Notwithstanding the
foregoing, in the event of the Employee’s Termination of Service due to death,
if the right to exercise any of the Shares specified in Paragraph 1 had not yet
vested, then the right to exercise such Shares will vest on the date of the
Employee’s Termination of Service.

 

5.                                       Expiration of Option.  In the event of
the Employee’s Termination of Service for any reason other than Retirement,
Disability, death or for cause, the Employee may, within three (3) months after
the date of such Termination, or prior to the Expiration Date, whichever shall
first occur, exercise any vested but unexercised portion of this option.  In the
event of the Employee’s Termination of Service due to Disability, the Employee
may, within one (1) year after the date of such Termination, or prior to the
Expiration Date, whichever shall first occur, exercise any vested but
unexercised portion of this option.  In the event of the Employee’s Termination
of Service due to Retirement, the Employee may, within three (3) years from the
date of such Termination, or prior to the Expiration Date, whichever shall first
occur, exercise any vested but unexercised portion of this option.  In the event
of the Employee’s Termination of Service by the Company for cause (as determined
by the Company), the Employee may not exercise any portion of this option that
is unexercised on the date of such Termination.

 

6.                                       Death of Employee.  In the event that
the Employee dies while in the employ of the Company and/or an Affiliate or
during the three (3) month, three (3) year or one (1) year periods referred to
in Paragraph 5 above, the Employee’s designated beneficiary, or if either no
beneficiary survives the Employee or the Committee does not permit beneficiary
designations, the administrator or executor of the Employee’s estate, may,
within three (3) years after the date of death, exercise any vested but
unexercised portion of the option.  Any such transferee must furnish the Company
(a) written notice of his or her status as a transferee, (b) evidence
satisfactory to the Company to establish the validity of the transfer of this
option and compliance with any laws or regulations pertaining to such transfer,
and (c) written acceptance of the terms and conditions of this option as set
forth in this Agreement.

 

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7.                                       Persons Eligible to Exercise Option. 
This option shall be exercisable during the Employee’s lifetime only by the
Employee.  The option shall not be transferable by the Employee, except by (a) a
valid beneficiary designation made in a form and manner acceptable to the
Committee, or (b) will or the applicable laws of descent and distribution.

 

8.                                       Exercise of Option.  This option may be
exercised by the person then entitled to do so as to any Shares which may then
be purchased (a) by giving written notice of exercise to the Secretary of the
Company (or his or her designee), specifying the number of full Shares to be
purchased and accompanied by full payment of the Exercise Price (and the amount
of any income or other taxes the Company determines is required to be withheld
by reason of such exercise), and (b) by giving satisfactory assurances in
writing if requested by the Company, signed by the person exercising the option,
that the Shares to be purchased upon such exercise are being purchased for
investment and not with a view to the distribution thereof.  In the absolute
discretion of the Committee, the person entitled to exercise the option may
elect to satisfy the tax-withholding requirement described in subparagraph
(a) above by having the Company withhold Shares or by delivering to the Company
already-owned Shares.  No partial exercise of this option may be for less than
ten (10) Share lots or multiples thereof.

 

9.                                       Suspension of Exercisability.  If at
any time the Company shall determine, in its discretion, that the listing,
registration or qualification of the Shares upon any securities exchange or
under any state or federal law, or the consent or approval of any governmental
regulatory authority, is necessary or desirable as a condition of the purchase
of Shares hereunder, this option may not be exercised, in whole or in part,
unless and until such listing, registration, qualification, consent or approval
shall have been effected or obtained free of any conditions not acceptable to
the Company.  The Company shall make reasonable efforts to meet the requirements
of any such state or federal law or securities exchange and to obtain any such
consent or approval of any such governmental authority.

 

10.                                 No Rights of Stockholder.  Neither the
Employee (nor any beneficiary) shall be or have any of the rights or privileges
of a stockholder of the Company in respect of any of the Shares issuable
pursuant to the exercise of this option, unless and until certificates
representing such Shares shall have been issued, recorded on the records of the
Company or its transfer agents or registrars, and delivered to the Employee (or
beneficiary).

 

11.                                 No Effect on Service.  The Employee’s
employment with the Company and its Affiliates is on an at-will basis only. 
Accordingly, subject to any written, express employment with the Employee,
nothing in this Agreement or the Plan shall confer upon the Employee any right
to continue to be employed by the Company or any Affiliate or shall interfere
with or restrict in any way the rights of the Company or the Affiliate, which
are hereby expressly reserved, to terminate the employment of the Employee at
any time for any reason whatsoever, with or without good cause.  Such
reservation of rights can be modified only in an express written contract
executed by a duly authorized officer of the Company or the Affiliate employing
or otherwise engaging the Employee.  For purposes of this Agreement, the
transfer of the employment of the Employee between the Company and any one of
its Affiliates (or between Affiliates) shall not be deemed a Termination of
Service.  Nothing herein contained shall affect the Employee’s right to
participate in and receive benefits under and in accordance with the then
current provisions of any pension, insurance or other employee welfare plan or
program of the Company or any Affiliate.

 

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12.                                 Address for Notices.  Any notice to be given
to the Company under the terms of this Agreement shall be addressed to the
Company, in care of its Secretary, at 3100 Hansen Way, Palo Alto, California
94304, or at such other address as the Company may hereafter designate in
writing.

 

13.                                 Option is Not Transferable.  Except as
otherwise expressly provided herein, this option and the rights and privileges
conferred hereby may not be transferred, pledged, assigned or otherwise
hypothecated in any way (whether by operation of law or otherwise) and shall not
be subject to sale under execution, attachment or similar process.  Upon any
attempt to transfer, pledge, assign, hypothecate or otherwise dispose of this
option, or of any right or privilege conferred hereby, or upon any attempted
sale under any execution, attachment or similar process, this option and the
rights and privileges conferred hereby immediately shall become null and void.

 

14.                                 Maximum Term of Option.  Notwithstanding any
other provision of this Agreement except Paragraph 6 above relating to the death
of the Employee (in which case this option is exercisable to the extent set
forth therein), this option is not exercisable after the Expiration Date.

 

15.                                 Binding Agreement.  Subject to the
limitation on the transferability of this option contained herein, this
Agreement shall be binding upon and inure to the benefit of the heirs, legatees,
legal representatives, successors and assigns of the parties hereto.

 

16.                                 Conditions to Exercise.  The Exercise Price
for this option must be paid in the legal tender of the United States
(including, in the Committee’s sole discretion, by means of a broker-assisted
cashless exercise) or, in the Committee’s sole discretion, in Shares of
equivalent value.  Exercise of this option will not be permitted until
satisfactory arrangements have been made for the payment of the appropriate
amount of withholding taxes (as determined by the Company).  If the Employee
fails to remit to the Company such withholding amount within the time period
specified by the Committee (in its discretion), the award may be forfeited and
in such case the Employee shall not receive any of the Shares subject to this
Agreement.

 

17.                                 Plan Governs.  This Agreement is subject to
all of the terms and provisions of the Plan.  In the event of a conflict between
one or more provisions of this Agreement and one or more provisions of the Plan,
the provisions of the Plan shall govern.  Capitalized terms and phrases used and
not defined in this Agreement shall have the meaning set forth in the Plan.

 

18.                                 Committee Authority.  The Committee shall
have all discretion, power, and authority to interpret the Plan and this
Agreement and to adopt such rules for the administration, interpretation and
application of the Plan as are consistent therewith.  All actions taken and all
interpretations and determinations made by the Committee in good faith shall be
final and binding upon the Employee, the Company and all other interested
persons, and shall be given the maximum deference permitted by law.  No member
of the Committee shall be personally liable for any action, determination or
interpretation made in good faith with respect to the Plan or this Agreement.

 

19.                                 Governing Law.  This Agreement shall be
governed by and construed in accordance with the laws of the State of
California, without reference to its principles of conflicts of law.

 

20.                                 Captions.  The captions provided herein are
for convenience only and are not to serve as a basis for the interpretation or
construction of this Agreement.

 

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21.                                 Agreement Severable.  In the event that any
provision in this Agreement shall be held invalid or unenforceable, such
provision shall be severable from, and such invalidity or unenforceability shall
not be construed to have any effect on, the remaining provisions of this
Agreement.

 

22.                                 Retirement Definition and Fortifier.  For
purposes of this Agreement, Retirement shall mean an employee’s voluntary
termination of employment at age 65 or above, or at age 55 with a minimum of 10
years employment with the Company, provided, however, that in the event employee
commences employment with a company which competes with the Company in any of
Company’s business, including but not limited to, equipment, software or other
products for the treatment of cancer, X-ray tubes, flat panel imaging devices
and industrial X-ray imaging devices,  Company may, in its sole discretion,
terminate this Agreement, including the vesting of any options or other grants
which remain unvested as of the date employee commences employment with the
competitive company.

 

23.                                 Modifications to the Agreement.  This
Agreement constitutes the entire understanding of the parties on the subjects
covered.  The Employee expressly warrants that he or she is not executing this
Agreement in reliance on any promises, representations, or inducements other
than those contained herein.  Modifications to this Agreement or the Plan can be
made only in an express written contract executed by a duly authorized officer
of the Company.

 

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