Exhibit 10.2

DIGIRAD CORPORATION

2011 INDUCEMENT STOCK INCENTIVE PLAN

NOTICE OF STOCK OPTION AWARD

 

Grantee’s Name:

  Type of Options   Non-Qualified

Date of Award

  Vesting Commencement Date  

Expiration Date

  Post-Termination Exercise Period  

Exercise Price per Share

  Number of Stock Options Granted  

You (the “Grantee”) have been granted, as an inducement material to your
decision to accept employment with Digirad Corporation (the “Company”) an option
to purchase shares of Common Stock, subject to the terms and conditions of this
Notice of Stock Option Award (the “Notice”), the Digirad Corporation 2011
Inducement Stock Incentive Plan (the “Plan”) and the Stock Option Award
Agreement (the “Option Agreement”) attached and incorporated into this Notice.
Unless otherwise defined in the Option Agreement, capitalized terms shall have
the meaning defined in the Plan.

Vesting Schedule:

Subject to the Grantee’s Continuous Service and other limitations set forth in
this Notice, the Plan, and the Option Agreement, the Option to purchase Shares
may be exercised, in whole or in part, in accordance with the following
schedule:

25% of the Shares subject to the Option shall vest on the first anniversary of
the Vesting Commencement Date, and, thereafter, the remaining 75% of the Options
will vest in 1/36 monthly increments until the options are completely vested on
the fourth anniversary of the Vesting Commencement Date, as long as Grantee is
in Continuous Service with the Company.

In the event of termination of the Grantee’s Continuous Service for Cause, the
Grantee’s right to exercise the Option shall terminate concurrently with the
termination of the Grantee’s Continuous Service.

IN WITNESS WHEREOF, the Company and the Grantee have executed this Notice and
agree that the Option is to be governed by the terms and conditions of this
Notice, the Plan, and the Option Agreement.

Digirad Corporation,

a Delaware corporation

By:                                                             
                    

Title: President and CEO

Grantee acknowledges receipt of a copy of the Plan and the Option Agreement
attached to this Notice, and represents that he or she is familiar with the
terms and provisions thereof, and hereby accepts the Option subject to all of
the terms and provisions hereof and thereof. The Grantee has reviewed this
Notice, the Plan, and the Option Agreement in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Notice, and
fully understands all provisions of this Notice, the Plan, and the Option
Agreement. The Grantee hereby specifically agrees that all questions of
interpretation and administration relating to this Notice, the Plan and the
Option Agreement shall be resolved by the Plan Administrator in accordance with
Section 14 of the Option Agreement. The Grantee further specifically agrees to
the venue selection, the waiver of a jury trial and the acknowledgements in
Sections 15 and 16 of the Option Agreement.

 

Dated:                                         

Grantee Signature:                                                             
                         

 

 

1

--------------------------------------------------------------------------------

DIGIRAD CORPORATION 2011 INDUCEMENT STOCK INCENTIVE PLAN

STOCK OPTION AWARD AGREEMENT

1. Grant of Option. Digirad Corporation, a Delaware corporation (the “Company”),
hereby grants to the Grantee named in the Notice of Stock Option Award (the
“Notice”), an option to purchase (the “Option”) the Total Number of Shares of
Common Stock (the “Shares”) subject to the Option set forth in the Notice, at
the Exercise Price per Share set forth in the Notice (the “Exercise Price”)
subject to the terms and provisions of the Notice, this Stock Option Award
Agreement (the “Option Agreement”), and the Company’s 2011 Inducement Stock
Incentive Plan (the “Plan”), which are incorporated herein by reference. Unless
otherwise defined herein, the terms defined in the Plan shall have the same
defined meanings in this Option Agreement.

The Option is intended to qualify as a Non-Qualified Stock Option and not as an
Incentive Stock Option as defined in Section 422 of the Code.

2. Exercise of Option.

(a) Right to Exercise. The Option shall be exercisable during its term in
accordance with the Vesting Schedule set out in the Notice and with the
applicable provisions of the Plan and this Option Agreement. The Option shall be
subject to the provisions of Section 11 of the Plan relating to the
exercisability or termination of the Option in the event of a Corporate
Transaction or Change in Control. The Grantee shall be subject to reasonable
limitations on the number of requested exercises during any monthly or weekly
period as determined by the Administrator. In no event shall the Company issue
fractional Shares.

(b) Method of Exercise. The Option shall be exercisable pursuant to the
procedure specified from time to time by the Administrator, which shall state
the election to exercise the Option, the whole number of Shares in respect of
which the Option is being exercised, and such other provisions as may be
required by the Administrator. The exercise notice shall be delivered in person,
by certified mail, or by such other method (including electronic transmission)
as determined from time to time by the Administrator, to the Company accompanied
by payment of the Exercise Price. The Option shall be deemed to be exercised
upon receipt by the Company of such notice accompanied by the Exercise Price,
which, to the extent selected, shall be deemed to be satisfied by use of the
broker-dealer sale and remittance procedure to pay the Exercise Price provided
in Section 3(d), below.

(c) Taxes. No Shares will be delivered to the Grantee or other person pursuant
to the exercise of the Option until the Grantee or other person has made
arrangements acceptable to the Administrator for the satisfaction of applicable
income tax and employment tax withholding obligations, including, without
limitation, such other tax obligations of the Grantee incident to the receipt of
Shares. Upon exercise of the Option, the Company or the Grantee’s employer may
offset or withhold (from any amount owed by the Company or the Grantee’s
employer to the Grantee) or collect from the Grantee or other person an amount
sufficient to satisfy such tax withholding obligations.

 

1

--------------------------------------------------------------------------------

3. Method of Payment. Payment of the Exercise Price shall be made by any of the
following, or a combination thereof, at the election of the Grantee; provided,
however, that such exercise method does not then violate any Applicable Law and,
provided further, that the portion of the Exercise Price equal to the par value
of the Shares must be paid in cash or other legal consideration permitted by the
Delaware General Corporation Law:

(a) cash;

(b) check;

(c) surrender of Shares or delivery of a properly executed form of attestation
of ownership of Shares as the Administrator may require which have a Fair Market
Value on the date of surrender or attestation equal to the aggregate Exercise
Price of the Shares as to which the Option is being exercised, provided,
however, that Shares acquired under the Plan or any other equity compensation
plan or agreement of the Company must have been held by the Grantee for a period
of more than six (6) months (and not used for another Award exercise by
attestation during such period); or

(d) payment through a broker-dealer sale and remittance procedure pursuant to
which the Grantee: (i) shall provide written instructions to a
Company-designated brokerage firm to effect the immediate sale of some or all of
the purchased Shares and remit to the Company sufficient funds to cover the
aggregate exercise price payable for the purchased Shares, and (ii) shall
provide written directives to the Company to deliver the certificates for the
purchased Shares directly to such brokerage firm in order to complete the sale
transaction.

4. Restrictions on Exercise. The Option may not be exercised if the issuance of
the Shares subject to the Option upon such exercise would constitute a violation
of any Applicable Laws. If the exercise of the Option within the applicable time
periods set forth in Section 6, 7, and 8 of this Option Agreement is prevented
by the provisions of this Section 4, the Option shall remain exercisable until
one (1) month after the date the Grantee is notified by the Company that the
Option is exercisable, but in any event no later than the Expiration Date set
forth in the Notice.

5. Leave of Absence. During any authorized leave of absence, the vesting of the
Option as provided in the Notice shall be suspended after the leave of absence
exceeds a period of ninety (90) days. Vesting of the Option shall resume upon
the Grantee’s termination of the leave of absence and return to service to the
Company. The Vesting Schedule of the Option shall be extended by the length of
the suspension.

6. Termination or Change of Continuous Service. In the event the Grantee’s
Continuous Service terminates, other than for Cause, the Grantee may, but only
during the Post-Termination Exercise Period, exercise the portion of the Option
that was vested at the date of such termination (the “Termination Date”). The
Post-Termination Exercise Period shall commence on the Termination Date. In the
event of termination of the Grantee’s Continuous Service for Cause, the
Grantee’s right to exercise the Option shall, except as otherwise determined by
the Administrator, terminate concurrently with the termination of the Grantee’s
Continuous Service (also the “Termination Date”). In no event, however, shall
the Option be

 

2

--------------------------------------------------------------------------------

exercised later than the Expiration Date set forth in the Notice. In the event
of the Grantee’s change in status from Employee, Director or Consultant to any
other status of Employee, Director or Consultant, the Option shall remain in
effect. In the event of the Grantee’s change in status from Employee to Director
or Consultant, vesting of the Option shall continue only to the extent
determined by the Administrator as of such change in status. Except as provided
in Sections 7 and 8 below, to the extent that the Option was unvested on the
Termination Date, or if the Grantee does not exercise the vested portion of the
Option within the Post-Termination Exercise Period, the Option shall terminate.
In the event of the Grantee’s change in status from Employee to Consultant or
from an Employee whose customary employment is 20 hours or more per week to an
Employee whose customary employment is fewer than 20 hours per week, vesting of
the Option shall continue only to the extent determined by the Administrator as
of such change in status.

7. Disability of Grantee. In the event the Grantee’s Continuous Service
terminates as a result of his or her Disability, the Grantee may, but only
within twelve (12) months commencing on the Termination Date (but in no event
later than the Expiration Date), exercise the portion of the Option that was
vested on the Termination Date. To the extent that the Option was unvested on
the Termination Date, or if the Grantee does not exercise the vested portion of
the Option within the time specified herein, the Option shall terminate.

8. Death of Grantee. In the event of the termination of the Grantee’s Continuous
Service as a result of his or her death, or in the event of the Grantee’s death
during the Post-Termination Exercise Period or during the twelve (12) month
period following the Grantee’s termination of Continuous Service as a result of
his or her Disability, the person who acquired the right to exercise the Option
pursuant to Section 9 may exercise the portion of the Option that was vested at
the date of termination within twelve (12) months commencing on the date of
death (but in no event later than the Expiration Date). To the extent that the
Option was unvested on the date of death, or if the vested portion of the Option
is not exercised within the time specified herein, the Option shall terminate.

9. Transferability of Option. The Option may not be transferred in any manner
other than by will or by the laws of descent and distribution, provided,
however, that the Option may be transferred during the lifetime of the Grantee
to the extent and in the manner authorized by the Administrator. Notwithstanding
the foregoing, the Grantee may designate one or more beneficiaries of the
Grantee’s Option in the event of the Grantee’s death on a beneficiary
designation form provided by the Administrator. Following the death of the
Grantee, the Option, to the extent provided in Section 8, may be exercised:
(a) by the person or persons designated under the deceased Grantee’s beneficiary
designation, or (b) in the absence of an effectively designated beneficiary, by
the Grantee’s legal representative or by any person empowered to do so under the
deceased Grantee’s will or under the then applicable laws of descent and
distribution. The terms of the Option shall be binding upon the executors,
administrators, heirs, successors and transferees of the Grantee.

10. Term of Option. The Option must be exercised no later than the Expiration
Date set forth in the Notice or such earlier date as otherwise provided herein.
After the Expiration Date or such earlier date, the Option shall be of no
further force or effect and may not be exercised.

 

3

--------------------------------------------------------------------------------

11. Tax Consequences. Set forth below is a brief summary as of the date of this
Option Agreement of some of the federal tax consequences of exercise of the
Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE,
AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE GRANTEE SHOULD
CONSULT A TAX ADVISER BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES.

(a) Exercise of Non-Qualified Stock Option. On exercise of a Non-Qualified Stock
Option, the Grantee will be treated as having received compensation income
(taxable at ordinary income tax rates) equal to the excess, if any, of the Fair
Market Value of the Shares on the date of exercise over the Exercise Price. If
the Grantee is an Employee or a former Employee, the Company will be required to
withhold from the Grantee’s compensation or collect from the Grantee and pay to
the applicable taxing authorities an amount in cash equal to a percentage of
this compensation income at the time of exercise, and may refuse to honor the
exercise and refuse to deliver Shares if such withholding amounts are not
delivered at the time of exercise.

(b) Disposition of Shares. In the case of a Non-Qualified Stock Option, if
Shares are held for more than one year, any gain realized on disposition of the
Shares will be treated as long-term capital gain for federal income tax
purposes.

12. Entire Agreement: Governing Law. The Notice, the Plan, and this Option
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and the Grantee with respect to the subject matter
hereof, and may not be modified adversely to the Grantee’s interest except by
means of a writing signed by the Company and the Grantee. Nothing in the Notice,
the Plan, and this Option Agreement (except as expressly provided therein) is
intended to confer any rights or remedies on any persons other than the parties.
The Notice, the Plan, and this Option Agreement are to be construed in
accordance with and governed by the internal laws of the State of California,
without giving effect to any choice of law rule that would cause the application
of the laws of any jurisdiction other than the internal laws of the State of
California to the rights and duties of the parties. Should any provision of the
Notice, the Plan, or this Option Agreement be determined to be illegal or
unenforceable, such provision shall be enforced to the fullest extent allowed by
law and the other provisions shall nevertheless remain effective and shall
remain enforceable.

13. Construction. The captions used in the Notice and this Option Agreement are
inserted for convenience and shall not be deemed a part of the Option for
construction or interpretation. Except when otherwise indicated by the context,
the singular shall include the plural and the plural shall include the singular.
Use of the term “or” is not intended to be exclusive, unless the context clearly
requires otherwise.

14. Administration and Interpretation. Any question or dispute regarding the
administration or interpretation of the Notice, the Plan, or this Option
Agreement shall be submitted by the Grantee or by the Company to the
Administrator. The resolution of such question or dispute by the Administrator
shall be final and binding on all persons.

 

4

--------------------------------------------------------------------------------

15. Venue and Waiver of Jury Trial. The Company, the Grantee, and the Grantee’s
assignees pursuant to Section 9 (the “parties”) agree that any suit, action, or
proceeding arising out of or relating to the Notice, the Plan, or this Option
Agreement shall be brought in the United States District Court for the Southern
District of California (or should such court lack jurisdiction to hear such
action, suit or proceeding, in a California state court in the County of San
Diego) and that the parties shall submit to the jurisdiction of such court. The
parties irrevocably waive, to the fullest extent permitted by law, any objection
the party may have to the laying of venue for any such suit, action or
proceeding brought in such court. THE PARTIES ALSO EXPRESSLY WAIVE ANY RIGHT
THEY HAVE OR MAY HAVE TO A JURY TRIAL OF ANY SUCH SUIT, ACTION OR PROCEEDING. If
any one or more provisions of this Section 15 shall for any reason be held
invalid or unenforceable, it is the specific intent of the parties that such
provisions shall be modified to the minimum extent necessary to make it or its
application valid and enforceable.

16. Acknowledgments of Grantee. THE GRANTEE ACKNOWLEDGES AND AGREES THAT THE
SHARES SUBJECT TO THE OPTION SHALL VEST, IF AT ALL, ONLY DURING THE PERIOD OF
THE GRANTEE’S CONTINUOUS SERVICE (NOT THROUGH THE ACT OF BEING HIRED, BEING
GRANTED THE OPTION OR ACQUIRING SHARES HEREUNDER). THE GRANTEE FURTHER
ACKNOWLEDGES AND AGREES THAT NOTHING IN THIS NOTICE, THE OPTION AGREEMENT, OR
THE PLAN SHALL CONFER UPON THE GRANTEE ANY RIGHT WITH RESPECT TO FUTURE AWARDS
OR CONTINUATION OF THE GRANTEE’S CONTINUOUS SERVICE, NOR SHALL IT INTERFERE IN
ANY WAY WITH THE GRANTEE’S RIGHT OR THE RIGHT OF THE COMPANY OR RELATED ENTITY
TO WHICH THE GRANTEE PROVIDES SERVICES TO TERMINATE THE GRANTEE’S CONTINUOUS
SERVICE, WITH OR WITHOUT CAUSE, AND WITH OR WITHOUT NOTICE. THE GRANTEE
ACKNOWLEDGES THAT UNLESS THE GRANTEE HAS A WRITTEN EMPLOYMENT AGREEMENT WITH THE
COMPANY TO THE CONTRARY, THE GRANTEE’S STATUS IS AT WILL.

17. Rights as Stockholder. Until the stock certificate evidencing such Shares is
issued (as evidenced by the appropriate entry on the books of the Company or of
a duly authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a stockholder shall exist with respect to the
Shares, notwithstanding the exercise of the Option. The Company shall issue (or
cause to be issued) such stock certificate promptly after the Option is
exercised. No adjustment will be made for a dividend or other right for which
the record date is prior to the date the stock certificate is issued, except as
provided in Section 10 of the Plan.

18. Notices. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery, upon
deposit for delivery by an internationally recognized express mail courier
service or upon deposit in the United States mail by certified mail (if the
parties are within the United States), with postage and fees prepaid, addressed
to the other party at its address as shown in these instruments, or to such
other address as such party may designate in writing from time to time to the
other party.

END OF AGREEMENT

 

5