<PAGE>

                                                                    EXHIBIT 10.2

                           COLOR KINETICS INCORPORATED

                        2004 EMPLOYEE STOCK PURCHASE PLAN

SECTION 1. GENERAL PURPOSE OF THE PLAN.

         The Color Kinetics Incorporated 2004 Employee Stock Purchase Plan (the
"Plan") is intended to provide a method whereby employees of Color Kinetics
Incorporated (the "Company") will have an opportunity to acquire an ownership
interest (or increase an existing ownership interest) in the Company through the
purchase of shares of the Common Stock of the Company. It is the intention of
the Company that the Plan qualify as an "employee stock purchase plan" under
Section 423 of the Internal Revenue Code of 1986, as amended (the "Code"). The
provisions of the Plan shall, accordingly, be construed so as to extend and
limit participation in a manner consistent with the requirements of that section
of the Code.

SECTION 2. DEFINITIONS.

         (a)      "Board" means the Board of Directors of the Company.

         (b)      "Committee" means the Compensation Committee of the Board.

         (c)      "Common Stock" means the common stock, $.001 par value per
                  share, of the Company.

         (d)      "Company" shall also include any Parent or Subsidiary of Color
                  Kinetics Incorporated designated by the Board, unless the
                  context otherwise requires.

         (e)      "Compensation" means, for the purpose of any Offering pursuant
                  to this Plan, an Employee's base pay at the rate in effect
                  as of the Offering Commencement Date (as hereinafter defined).
                  Compensation shall not include any deferred compensation other
                  than salary reduction contributions under a cash or deferred
                  arrangement pursuant to Section 401(k) of the Code, salary
                  reduction amounts under a cafeteria plan pursuant to Section
                  125 of the Code, and salary reduction amounts pursuant to a
                  qualified transportation fringe benefit program pursuant to
                  Section 132(f) of the Code.

         (f)      "Employee" means any person who is customarily employed
                  full time by the company.

         (g)      "Parent" shall mean any present or future corporation which is
                  or would constitute a "parent corporation" as that term is
                  defined in Section 424 of the Code.

         (h)      "Subsidiary" shall mean any present or future corporation
                  which is or would constitute a "subsidiary corporation" as
                  that term is defined in Section 424 of the Code.

<PAGE>

SECTION 3. ELIGIBILITY.

         (a)      Participation in the Plan is voluntary. Participation in any
                  one or more of the offerings under the Plan shall neither
                  limit, nor require, participation in any other offering.

         (b)      Each Employee shall be eligible to participate in the Plan on
                  the first Offering Commencement Date, as hereafter defined,
                  following the completion of three (3) full calendar months
                  of continuous service with the Company. Notwithstanding the
                  foregoing, no Employee shall be granted an option under the
                  Plan:

                  (i)      if, immediately after the grant, such Employee would
                           own stock, and/or hold outstanding options to
                           purchase stock, possessing 5% or more of the total
                           combined voting power or value of all classes of
                           stock of the Company or any Parent or Subsidiary; for
                           purposes of this Section, the rules of Section 424(d)
                           of the Code shall apply in determining stock
                           ownership of any Employee; or

                  (ii)     if the grant, together with all other outstanding
                           grants to the Employee under any Section 423 employee
                           stock purchase plan of the Company or of any Parent
                           or Subsidiary, would permit the Employee to purchase
                           in any calendar year stock having an aggregate fair
                           market value (determined in the manner set forth in
                           Section 7(b)(i) below at the time each such option is
                           granted) that is in excess of $25,000; provided that,
                           for purposes of this paragraph, the rules of Section
                           423(b)(8) of the Code shall apply; or

                  [(iii)   IF THE EMPLOYEE IS A "HIGHLY COMPENSATED EMPLOYEE"
                           WITHIN THE MEANING OF SECTION 414(q) OF THE CODE.]

SECTION 4. OFFERING DATES.

         The right to purchase stock hereunder shall be made available by a
series of three month offerings (the "Offering" or "Offerings") to
Employees eligible in accordance with Section 3 hereof. The Committee will, in
its discretion, determine the applicable date of commencement ("Offering
Commencement Date") and termination date ("Offering Termination Date") for each
Offering and the number of Offerings to be made available under the Plan.
Participation in any one or more of the Offerings under the Plan shall neither
limit, nor require, participation in any other Offering.

SECTION 5. PARTICIPATION.

         Any eligible Employee may become a participant by completing a payroll
deduction authorization form provided by the Company and filing it with the
office of the plan administrator appointed by the Committee (the "Plan
Administrator") at least 20 days prior to an applicable Offering Commencement
Date. A participant who purchases shares of Common

                                      -2-
<PAGE>

Stock in one Offering will be deemed to have elected to participate in each
subsequent Offering, provided such participant is eligible to participate during
each such subsequent Offering and provided that such participant has not
specifically elected not to participate in such subsequent Offering. Such
participant will also be deemed to have authorized the same rate of payroll
deductions under Section 6 hereof for each such subsequent Offering as in the
immediately preceding Offering; provided however, that, at least 20 days prior
to the Offering Commencement Date for each new Offering, the participant may
elect to change such participant's payroll deductions by submitting a new
payroll deduction authorization form or elect not to participate in the new
Offering.

SECTION 6. PAYROLL DEDUCTIONS.

         (a)      At the time a participant files his or her authorization for a
                  payroll deduction, he or she shall elect to have deductions
                  made from his or her pay on each payday during any Offering in
                  which he or she is a participant at a specified percentage of
                  his or her Compensation; said percentage shall be in
                  increments of one percent up to a maximum percentage of ten
                  percent.

         (b)      Payroll deductions for a participant shall commence on the
                  applicable Offering Commencement Date when his or her
                  authorization for a payroll deduction becomes effective and
                  subject to the last sentence of Section 5 shall end on the
                  Offering Termination Date of the Offering to which such
                  authorization is applicable unless sooner terminated by the
                  participant as provided in Section 10.

         (c)      All payroll deductions made for a participant shall be
                  credited to his or her account under the Plan. A participant
                  may not make any separate cash payment into such account.

         (d)      A participant may withdraw from the Plan at any time during
                  the applicable Offering period.

SECTION 7. GRANTING OF OPTION.

         (a)      Except as provided in clause (ii) of Section 3(b), on the
                  Offering Commencement Date of each Offering, a participating
                  Employee shall be deemed to have been granted an option to
                  purchase a maximum number of shares of the Common Stock equal
                  to two times an amount determined as follows: (i) an amount
                  equal to 85% of the market value per share of the Common Stock
                  on the applicable Offering Commencement Date shall be divided
                  into (ii) an amount equal to (A) the percentage of the
                  Employee's Compensation which he or she has elected to have
                  withheld (but no more than 10%) multiplied by (B) the
                  aggregate amount of the Compensation payable to the Employee
                  over the Offering period. Such market value per share of the
                  Common Stock shall be determined as provided in clause (i) of
                  Section 7(b).

                                      -3-
<PAGE>

         (b)      The option price of the Common Stock purchased with payroll
                  deductions made during each such Offering for the account of a
                  participating Employee shall be 85% of the lower of:

                  (i)      the closing price per share as reported by a
                           nationally recognized stock exchange, or, if the
                           Common Stock is not listed on such an exchange, as
                           reported by the National Association of Securities
                           Dealers Automated Quotation System ("Nasdaq")
                           National Market System or, if the Common Stock is not
                           listed on the Nasdaq National Market System but is
                           otherwise publicly traded over-the-counter, 85% of
                           the mean of the bid and asked prices per share on the
                           Offering Commencement Date or, if the Common Stock is
                           not traded over-the-counter, 85% of the fair market
                           value as determined by the Committee (collectively,
                           the "Market Value"), determined as of the Offering
                           Commencement Date; and

                  (ii)     the Market Value determined as of the Offering
                           Termination Date.

SECTION 8. EXERCISE OF OPTION.

         (a)      Unless a participant gives written notice to the Plan
                  Administrator prior to the Offering Termination Date as
                  hereinafter provided, his or her option for the purchase of
                  Common Stock with payroll deductions made during any Offering
                  will automatically be deemed to have been exercised on the
                  Offering Termination Date applicable to such Offering for the
                  purchase of the number of full shares of Common Stock which
                  the accumulated payroll deductions in his or her account at
                  that time will purchase at the applicable option price (but
                  not in excess of the number of shares for which options have
                  been granted the Employee pursuant to Section 7(a)), and any
                  excess in his or her account at that time, other than amounts
                  representing fractional shares, will be returned to him or
                  her.

         (b)      Fractional shares will not be issued under the Plan and any
                  accumulated payroll deductions which would have been used to
                  purchase fractional shares shall be automatically carried
                  forward to the next Offering unless the participant elects, by
                  written notice to the Plan Administrator, to have the excess
                  cash returned to him or her.

SECTION 9. DELIVERY OF SHARES.

         The Company shall deliver to each participant (as promptly as possible
after the appropriate Offering Termination Date), a certificate representing the
Common Stock purchased upon exercise of his or her option.

SECTION 10. WITHDRAWAL AND TERMINATION.

         (a)      Prior to the Offering Termination Date for an Offering, any
                  participant may withdraw the payroll deductions credited to
                  his or her account under the Plan for such Offering by giving
                  written notice to the Plan Administrator. All of the

                                      -4-
<PAGE>

                  participant's payroll deductions credited to such account will
                  be paid to him or her promptly after receipt of notice of
                  withdrawal, without interest, and no future payroll deductions
                  will be made from his or her pay during such Offering. The
                  Company will treat any attempt to borrow by a participant on
                  the security of accumulated payroll deductions as an election
                  to withdraw such deductions.

         (b)      A participant's election not to participate in, or withdrawal
                  from, any Offering will not have any effect upon his or her
                  eligibility to participate in any succeeding Offering or in
                  any similar plan which may hereafter be adopted by the
                  Company.

         (c)      Upon termination of the participant's employment for any
                  reason, including retirement but excluding death, the payroll
                  deductions credited to his or her account will be returned to
                  him or her, or, in the case of death, to the person or persons
                  entitled thereto under Section 14.

         (d)      Upon termination of the participant's employment because of
                  death, his or her beneficiary (as defined in Section 14) shall
                  have the right to elect, by written notice given to the Plan
                  Administrator prior to the expiration of a period of 90 days
                  commencing with the date of the death of the participant, but
                  not beyond the Offering Termination Date next following the
                  date of death, either:

                  (i)      to withdraw all of the payroll deductions credited to
                           the participant's account under the Plan; or

                  (ii)     to exercise the participant's option for the purchase
                           of stock on the Offering Termination Date next
                           following the date of the participant's death for the
                           purchase of the number of full shares which the
                           accumulated payroll deductions in the participant's
                           account at the date of the participant's death will
                           purchase at the applicable option price (subject to
                           the limitation contained in Section 7(a)), and any
                           excess in such account will be returned to said
                           beneficiary. In the event that no such written notice
                           of election shall be duly received by the office of
                           the Plan Administrator, the beneficiary shall
                           automatically be deemed to have elected to withdraw
                           the payroll deductions credited to the participant's
                           account at the date of the participant's death and
                           the same will be paid promptly to said beneficiary.

SECTION 11. INTEREST.

         No interest will be paid or allowed on any money paid into the Plan or
credited to the account of any participating Employee.

SECTION 12. STOCK.

         (a)      The maximum number of shares of Common Stock available for
                  issuance and purchase by Employees under the Plan, subject to
                  adjustment upon changes in capitalization of the Company as
                  provided in Section 17, shall be

                                      -5-
<PAGE>
                  150,000 shares of Common Stock, par value $.001 per share, of
                  the Company, which number shall increase on each of the First
                  Five (5) anniversaries of the effective date of this Plan by
                  an amount, if any, equal to the lesser of: (i) 50,000 shares
                  or (ii) an amount determined by the Board. Notwithstanding
                  the foregoing, the maximum cumulative number of shares of
                  Stock available for issuance and purchase by Employees under
                  the Plan is 400,000, subject to adjustment upon changes in
                  capitalization of the Company as provided in Section 17. If
                  the total number of shares for which options are exercised on
                  any Offering Termination Date in accordance with Section 8
                  exceeds the maximum number of shares for the applicable
                  Offering, the Company shall make a pro rata allocation of the
                  shares available for delivery and distribution in an equitable
                  manner, and the balances of payroll deductions credited to the
                  account of each participant under the Plan shall be returned
                  to the participant.

         (b)      The participant will have no interest in stock covered by his
                  or her option until such option has been exercised.

SECTION 13. ADMINISTRATION.

         The Plan shall be administered by the Committee. The interpretation and
construction of any provision of the Plan and adoption of rules and regulations
for administering the Plan shall be made by the Committee. Determinations made
by the Committee with respect to any matter or provision contained in the Plan
shall be final, conclusive and binding upon the Company and upon all
participants, their heirs or legal representatives. Any rule or regulation
adopted by the Committee shall remain in full force and effect unless and until
altered, amended, or repealed by the Committee.

SECTION 14. DESIGNATION OF BENEFICIARY.

         A participant shall file with the Plan Administrator a written
designation of a beneficiary who is to receive any Common Stock and/or cash
under the Plan. Such designation of beneficiary may be changed by the
participant at any time by written notice. Upon the death of a participant and
upon receipt by the Company of proof of the identity and existence at the
participant's death of a beneficiary validly designated by him or her under the
Plan, the Company shall deliver such Common Stock and/or cash to such
beneficiary. In the event of the death of a participant and in the absence of a
beneficiary validly designated under the Plan who is living at the time of such
participant's death, the Company shall deliver such Common Stock and/or cash to
the executor or administrator of the estate of the participant. No beneficiary
shall prior to the death of the participant by whom he or she has been
designated, acquire any interest in the Common Stock and/or cash credited to the
participant under the Plan.

                                      -6-
<PAGE>

SECTION 15. TRANSFERABILITY.

         Neither payroll deductions credited to a participant's account nor any
rights with regard to the exercise of an option or to receive Common Stock under
the Plan may be assigned, transferred, pledged, or otherwise disposed of in any
way by the participant other than by will or the laws of descent and
distribution. Any such attempted assignment, transfer, pledge, or other
disposition shall be without effect, except that the Company may treat such act
as an election to withdraw funds in accordance with Section 10.

SECTION 16. USE OF FUNDS.

         All payroll deductions received or held by the Company under this Plan
may be used by the Company for any corporate purpose, and the Company shall not
be obligated to segregate such payroll deductions.

SECTION 17. EFFECT OF CHANGES OF COMMON STOCK.

         If the Company shall subdivide or reclassify the Common Stock which has
been or may be subject to options under this Plan, or shall declare thereon any
dividend payable in shares of such Common Stock, or shall take any other action
of a similar nature affecting such Common Stock, then the number and class of
shares of Common Stock which may thereafter be subject to options under the Plan
(in the aggregate and to any participant) shall be adjusted accordingly and in
the case of each option outstanding at the time of any such action, the number
and class of shares which may thereafter be purchased pursuant to such option
and the option price per share shall be adjusted to such extent as may be
determined by the Committee, with the approval of independent public accountants
and counsel, to be necessary to preserve the rights of the holder of such
option.

SECTION 18. AMENDMENT OR TERMINATION.

         The Board may at any time terminate or amend the Plan. Except as
provided in Section 20, no such termination shall affect options previously
granted, nor may an amendment make any change in any option theretofore granted
which would adversely affect the rights of any participant holding options under
the Plan without the consent of such participant.

SECTION 19. NOTICES.

         All notices or other communications by a participant to the Company
under or in connection with the Plan shall be deemed to have been duly given
when received by the Plan Administrator.

SECTION 20. EFFECT OF CERTAIN TRANSACTIONS.

         If the Company is a party to a reorganization or merger with one or
more other corporations, whether or not the Company is the surviving or
resulting corporation, or if the Company consolidates with or into one or more
other corporations, or if the Company is liquidated or sells or otherwise
disposes of substantially all of its assets to another corporation

                                      -7-
<PAGE>

(each hereinafter referred to as a "Transaction"), in any such event while an
Offering is in progress under Section 4 hereof, then: (i) after the effective
date of such Transaction options shall remain outstanding and shall be
exercisable in shares of common Stock, or, if applicable, shares of such stock
or other securities, cash or property as the holders of shares of Common Stock
received pursuant to the terms of such transaction; or (ii) the Board may
accelerate the Offering Termination Date to a date coincident with or prior to
the effective date of such Transaction.

SECTION 21. APPROVAL OF STOCKHOLDERS.

         The Plan is subject to the approval of the stockholders of the Company
at their next annual meeting or at any special meeting of the stockholders for
which one of the purposes shall be to act upon the Plan.

SECTION 22. GOVERNMENTAL AND OTHER REGULATIONS.

         The Plan, and the grant and exercise of the rights to purchase shares
hereunder, and the Company's obligation to sell and deliver shares upon the
exercise of rights to purchase shares, shall be subject to all applicable
federal, state and foreign laws, rules and regulations, and to such approvals by
any regulatory or governmental agency as may, in the opinion of counsel for the
Company, be required. The Plan shall be governed by, and construed and enforced
in accordance with, the provisions of Sections 421, 423 and 424 of the Code and
the substantive laws of the Commonwealth of Massachusetts. In the event of any
inconsistency between such provisions of the Code and any such laws, such
provisions of the Code shall govern to the extent necessary to preserve
favorable federal income tax treatment afforded employee stock purchase plans
under Section 423 of the Code.

                                      * * *

                                      -8-