**Exhibit10.3**

** **

**ENDOCARDIAL SOLUTIONS,INC.**

**AMENDED AND RESTATED**

**DIRECTORS’ STOCK OPTIONPLAN**

(As Amended May14, 2002)

 

# 1.             Purposeof the Plan.  The purpose of thisEndocardial Solutions, Inc. Directors’ Stock Option Plan is to attract andretain the best available individuals for service as Directors of the Companyand provide additional incentive to the Outside Directors of the Company toserve as Directors.

 

None of theoptions granted hereunder shall be “incentive stock options” within the meaningof Section 422 of the Code (as hereinafter defined).

 

# 2.             Definitions.  As used herein, the following definitionsshall apply:

 

## (a)           “Board” shallmean the Board of Directors of the Company.

 

## (b)           “Code” shallmean the Internal Revenue Code of 1986, as amended.

 

## (c)           “Common Stock”shall mean the Common Stock of the Company.

 

## (d)           “Company” shallmean Endocardial Solutions, Inc., a Delaware corporation.

 

## (e)           “Continuous Statusas a Director” shall mean the absence of any interruption or termination ofservice as a Director.

 

## (f)            “Director”shall mean a member of the Board.

 

## (g)           “Employee” shallmean any person, including officers and Directors, employed by the Company orany parent or Subsidiary of the Company. The payment of a Director’s fee by the Company shall not be sufficientin and of itself to constitute “employment” by the Company.

 

## (h)           “Exchange Act”shall mean the Securities Exchange Act of 1934, as amended.

 

## (i)            “Option” shallmean a stock option granted pursuant to the Plan.

 

## (j)            “Optioned Stock”shall mean the Common Stock subject to an Option.

 

## (k)           “Optionee” shallmean an Outside Director who receives an Option.

 

## (l)            “Outside Director”shall mean a Director who is not an Employee.

 

## (m)          “Parent” shallmean a “parent corporation,” whether now or hereafter existing, as defined inSection 425(e) of the Code.

## (n)           “Plan” shallmean this Directors’ Stock Option Plan.

 

## (o)           “Shares” shallmean shares of the Common Stock, as adjusted in accordance with Section 10 ofthe Plan.

 

## (p)           “Subsidiary”shall mean a “subsidiary corporation,” whether now or hereafter existing, asdefined in Section 425(f) of the Code.

 

----

 

# 3.             StockSubject to the Plan.  Subject to theprovisions of Section 10 of the Plan, the maximum aggregate number of Shareswhich may be optioned and sold under the Plan is 300,000 Shares of CommonStock.  The Shares may be authorized,but unissued, or reacquired Common Stock.

 

If an Optionshould expire or become unexercisable for any reason without having beenexercised in full, the unpurchased Shares which were subject thereto shall,unless the Plan shall have been terminated, become available for future grantunder the Plan.  If Shares which wereacquired upon exercise of an Option are subsequently repurchased by the Company,such Shares shall not in any event be returned to the Plan and shall not becomeavailable for future grant under the Plan.

 

# 4.             Administrationof and Grants of Options under the Plan.

 

## (a)           Administrator.  Except as otherwise required herein, thePlan shall be administered by the Board.

 

## (b)           Procedure for Grants.  The provisions set forth in this Section4(b) shall not be amended more than once every six months, other than tocomport with changes in the Code, the Employee Retirement Income Security Actof 1974, as amended, or the rules thereunder. All grants of Options hereunder shall be made in accordance with thefollowing provisions:

 

### (i)            TheBoard shall have discretion to grant options to Outside Directors in additionto the Options described in Sections 4(b)(ii) and (iii) and to determinethe number of Shares to be covered by such Options.

 

### (ii)           EachOutside Director shall be automatically granted an Option (an “Initial Grant”)to purchase 10,000 Shares upon the date on which such person first becomes aDirector, whether through election by the shareholders of the Company orappointment by the Board of Directors to fill a vacancy.  Options granted under this section 4(b)(ii)shall become vested and thereby exercisable with respect to 33 1/3% on the dateof such Initial Grant, with respect to 33 1/3% of such Initial Grant on thetwelve month anniversary date of such Initial Grant and with respect to 33 1/3%of such Initial Grant on the date of the second twelve month anniversary date;provided, however, an unvested portion of an Initial Grant shall only vest solong as the Outside Director remains a Director on the date such portion vests.

 

### (iii)          Each Outside Director shall automaticallyreceive, on the date of each Annual Meeting of Shareholders, an Option topurchase 5,000 Shares of the Company’s Common Stock, such Option to becomeexercisable six months subsequent to the date of grant; provided,however, that such Option shall only be granted to Outside Directors who haveserved since the date of the last Annual Meeting of Shareholders and willcontinue to serve after the date of grant of such Option.

 

### (iv)          Theterms of an Option granted hereunder shall be as follows:

 

#### (A)                              Theterm of the Option shall be seven (7) years.

 

#### (B)                                TheOption shall be exercisable only while the Outside Director remains a Directorof the Company, except as set forth in Section 8 hereof.

 

#### (C)                                Theexercise price per Share shall be 100% of the fair market value per Share onthe date of grant of the Option.

 

#### (D)                               Tothe extent necessary to comply with the applicable provisions of Rule 16b-3promulgated under the Exchange Act (“Rule 16b-3”), no Option will beexercisable until a date more than six months subsequent to the date of thegrant of that Option.

 

2

----

 

#### (E)                                 ADirector shall be entitled to receive Options to purchase a total of no morethan 100,000 Shares of the Company’s Common Stock pursuant to the terms of thisPlan.

 

## (c)           Powers of the Board.  Subject to the provisions and restrictionsof the Plan, the Board shall have the authority, in its discretion:  (i) to determine, upon review of relevantinformation and in accordance with Section 7(b) of the Plan, the fair marketvalue of the Common Stock; (ii) to determine the exercise price per share ofOptions to be granted, which exercise price shall be determined in accordancewith Section 7(a) of the Plan; (iii) to interpret the Plan; (iv) to prescribe,amend and rescind rules and regulations relating to the Plan; (v) to authorizeany person to execute on behalf of the Company any instrument required toeffectuate the grant of an Option previously granted hereunder; and (vi) tomake all other determinations deemed necessary or advisable for theadministration of the Plan.

##  

## (d)           Effect of Board’sDecision.  All decisions,determinations and interpretations of the Board shall be final and binding onall Optionees and any other holders of any Options granted under the Plan.

 

# 5.             Eligibility.  Options may be granted only to OutsideDirectors.  All Options shall beautomatically granted in accordance with the terms set forth in Section 4(b)hereof.

 

The Plan shall notconfer upon any Optionee any right with respect to continuation of service as aDirector or nomination to serve as a Director, nor shall it interfere in anyway with any rights which the Director or the Company may have to terminate hisdirectorship at any time.

 

# 6.             Termof Plan.  The Plan shall becomeeffective upon the earlier of (i) its adoption by the Board or (ii) itsapproval by the shareholders of the Company as described in Section 16 of thePlan.  It shall continue in effect for aterm of ten (10) years unless sooner terminated under Section 12 of the Plan.

 

# 7.             ExercisePrice and Consideration.

 

## (a)           Exercise Price.  The per Share exercise price for the Sharesto be issued pursuant to exercise of an Option shall be 100% of the fair marketvalue per Share on the date of grant of the Option.

 

## (b)           Fair Market Value.  The fair market value (“Fair Market Value”)of a Share shall be determined by the Board in its discretion; provided,however, that where there is a public market for the Common Stock, the fairmarket value per Share shall be the closing price of the Common Stock in theover-the-counter market on the date of grant, as reported in The Wall StreetJournal (or, if not so reported, as otherwise reported by the NationalAssociation of Securities Dealers Automated Quotation (“NASDAQ”) System) or, inthe event the Common Stock is traded on the NASDAQ National Market System orlisted on a stock exchange, the fair market value per Share shall be theclosing price on such system or exchange on the date of grant of the Option, asreported in The Wall Street Journal.

 

## (c)           Form ofConsideration.  Subject tocompliance with applicable provisions of Section 16(b) of the Exchange Act, (orother applicable law), the consideration to be paid for the Shares to be issuedupon exercise of an Option, including the method of payment, shall bedetermined by the Board and may consist entirely of (i) cash, (ii) check, (iii)other Shares which (X) in the case of Shares acquired upon exercise of anOption, have been owned by the Optionee for more than six months on the date ofsurrender, and (Y) have a Fair Market Value on the date of exercise equal tothe aggregate exercise price of the Shares as to which said Option shall beexercised, (iv) authorization for the Company to retain from the total numberof Shares as to which the Option is exercised that number of Shares having aFair Market Value on the date of exercise equal to the exercise price for thetotal number of Shares as to which the Option is exercised, (v) delivery of aproperly executed exercise notice together with irrevocable instructions to abroker to promptly deliver to the Company the amount of sale or loan proceeds requiredto pay the exercise price, (vi) delivery of an irrevocable subscriptionagreement for the Shares which irrevocably obligates the option holder to takeand pay for the Shares not more than twelve months after the date of deliveryof the subscription agreement, (vii) any combination of the foregoing methodsof payment or (viii) such other consideration and method of payment for theissuance of Shares as may be permitted under applicable laws.  In

 

3

----

 

## making its determination as to the type ofconsideration to accept, the Board shall consider whether acceptance of suchconsideration may be reasonably expected to benefit the Company.

 

# 8.             Exerciseof Option.

 

## (a)           Procedure forExercise; Rights as a Shareholder. Any Option granted hereunder shall be exercisable at such times as areset forth in Section 4(b) hereof; provided however, that no Optionsshall be exercisable until shareholder approval of the Plan in accordance withSection 16 hereof has been obtained.

 

An Option may notbe exercised for a fraction of a Share.

 

An Option shall bedeemed to be exercised when written notice of such exercise has been given tothe Company in accordance with the terms of the Option by the person entitledto exercise the Option and full payment for the Shares with respect to whichthe Option is exercised has been received by the Company.  Full payment may consist of anyconsideration and method of payment allowable under Section 7(c) of thePlan.  Until the issuance (as evidencedby the appropriate entry on the books of the Company or of a duly authorizedtransfer agent of the Company) of the stock certificate evidencing such Shares,no right to vote or receive dividends or any other rights as a shareholdershall exist with respect to the Optioned Stock, notwithstanding the exercise ofthe Option.  A share certificate for thenumber of Shares so acquired shall be issued to the Optionee as soon aspracticable after exercise of the Option. No adjustment will be made for a dividend or other right for which therecord date is prior to the date the stock certificate is issued, except asprovided in Section 10 of the Plan.

 

Exercise of anOption in any manner shall result in a decrease in the number of Shares whichthereafter may be available, both for purposes of the Plan and for sale underthe Option, by the number of Shares as to which the Option is exercised.

##  

## (b)           Termination ofStatus as a Director.  If an OutsideDirector ceases to serve as a Director, he may, but only within seven (7)  years after the date he ceases to be aDirector of the Company, or by the date of termination of the Option, whicheveris earlier, exercise his Option to the extent that he was entitled to exerciseit at the date of such termination.  Tothe extent that he was not entitled to exercise an Option at the date of suchtermination, or if he does not exercise such Option (which he was entitled toexercise) within the time specified herein, the Option shall terminate.

 

## (c)           Disability ofOptionee.  Notwithstanding theprovisions of Section 8(b) above, in the event an Optionee is unable tocontinue his service as a Director with the Company as a result of his totaland permanent disability (as defined in Section 22(e)(3) of the Code) he may,but only within seven (7) months from the date of termination, exercise hisOption to the extent he was entitled to exercise it at the date of suchtermination.  To the extent that he wasnot entitled to exercise the Option at the date of termination, or if he doesnot exercise such Option (which he was entitled to exercise) within the timespecified herein, the Option shall terminate.

 

## (d)           Death of Optionee.  Notwithstanding the provisions of Section8(b) above, in the event of the death of an Optionee:

 

### (i)            duringthe term of the Option who is at the time of his death a Director of theCompany and who has been in Continuous Status as a Director since the date ofgrant of the Option, the Option may be exercised, at any time within seven (7)months following the date of death, by the Optionee’s estate or by a person whoacquired the right to exercise the Option by bequest or inheritance, but onlyto the extent of the right to exercise that would have accrued had the Optioneecontinued living and remained in Continuous Status as a Director for six (6)months after the date of death; or

 

### (ii)           withinthirty (30) days after the termination of Continuous Status as a Director, theOption may be exercised, at any time within seven (7) months following the dateof death, by the Optionee’s estate or by a person who acquired the right toexercise the Option by bequest or inheritance, but only to the extent of theright to exercise that had accrued at the date of termination.

 

# 9.             Non-Transferabilityof Options.  The Option may not be sold,pledged, assigned, hypothecated, transferred, or disposed of in any mannerother than by will or by the laws of descent or distribution and may beexercised, during the lifetime of the Optionee, only by the Optionee.

 

4

----

 

# 10.           AdjustmentsUpon Changes in Capitalization, Dissolution or Merger.

 

## (a)           In the event that thenumber of outstanding shares of Common Stock of the Company is changed by astock dividend, stock split, reverse stock split, combination, reclassificationor similar change in the capital structure of the Company withoutconsideration, the number of Shares available under this Plan and the number ofShares subject to outstanding Options and the exercise price per share of suchOptions shall be proportionately adjusted, subject to any required action bythe Board or shareholders of the Company and compliance with applicablesecurities laws; provided however, that no certificate or scriprepresenting fractional shares shall be issued upon exercise of any Option andany resulting fractions of a Share shall be ignored.  Such adjustment shall be made by the Board, whose determinationin that respect shall be final, binding and conclusive.

##  

## (b)           In the event of adissolution or liquidation of the Company, a merger in which the Company is notthe surviving corporation, a transaction or series of related transactions inwhich 100% of the then outstanding voting stock is sold or otherwisetransferred, or the sale of substantially all of the assets of the Company, anyor all outstanding Options shall, notwithstanding any contrary terms of thewritten agreement governing such Option, accelerate and become exercisable infull at least ten days prior to (and shall expire on) the consummation of suchdissolution, liquidation, merger or sale of stock or sale of assets on suchconditions as the Board shall determine unless the successor corporationassumes the outstanding Options or substitutes substantially equivalentoptions.

#  

# 11.           Timeof Granting Options.  The date ofgrant of an Option shall, for all purposes, be the date determined inaccordance with Section 4(b) hereof. Notice of the determination shall be given to each Outside Director towhom an Option is so granted within a reasonable time after the date of suchgrant.

 

# 12.           Amendmentand Termination of the Plan.

 

## (a)           Amendment andTermination.  The Board may at anytime amend, alter, suspend, or discontinue the Plan, but no amendment,alteration, suspension, or discontinuance shall be made which would impair therights of any Optionee under any grant theretofore made, without his or herconsent.  In addition, to the extentnecessary and desirable to comply with Rule 16b-3 under the Exchange Act (orany other applicable law or regulation), the Company shall obtain shareholderapproval of any Plan amendment in such a manner and to such a degree asrequired.

 

## (b)           Effect of Amendmentor Termination.  Any such amendmentor termination of the Plan shall not affect Options already granted and suchOptions shall remain in full force and effect as if this Plan had not beenamended or terminated, unless mutually agreed otherwise between the Optioneeand the Board, which agreement must be in writing and signed by the Optioneeand the Company.

 

# 13.           ConditionsUpon Issuance of Shares.  Sharesshall not be issued pursuant to the exercise of an Option unless the exerciseof such Option and the issuance and delivery of such Shares pursuant theretoshall comply with all relevant provisions of law, including, without limitation,the Securities Act of 1933, as amended, the Exchange Act, the rules andregulations promulgated thereunder, state securities laws, and the requirementsof any stock exchange upon which the Shares may then be listed, and shall befurther subject to the approval of counsel for the Company with respect to suchcompliance.

 

As a condition tothe exercise of an Option, the Company may require the person exercising suchOption to represent and warrant at the time of any such exercise that theShares are being purchased only for investment and without any presentintention to sell or distribute such Shares, if, in the opinion of counsel forthe Company, such a representation is required by any of the aforementionedrelevant provisions of law.

 

Inability of the Companyto obtain authority from any regulatory body having jurisdiction, whichauthority is deemed by the Company’s counsel to be necessary to the lawfulissuance and sale of any Shares hereunder, shall relieve the Company of anyliability in respect of the failure to issue or sell such Shares as to whichsuch requisite authority shall not have been obtained.

 

5

----

 

# 14.           Reservationof Shares.  The Company, during theterm of this Plan, will at all times reserve and keep available such number ofthe Shares available for issuance pursuant to this Plan as shall be sufficientto satisfy the requirements of the Plan.

#  

# 15.           OptionAgreement.  Options shall beevidenced by written option agreements in such form as the Board shall approve.

 

# 16.           ShareholderApproval.

##  

## (a)           The Plan shall besubject to approval by the shareholders of the Company within twelve (12)months of its adoption by the Board.  Ifsuch shareholder approval is obtained at a duly held shareholders’ meeting, itmay be obtained by the affirmative vote of the holders of a majority of theoutstanding shares of the Company present or represented and entitled to votethereon.  If such shareholder approvalis obtained by written consent, it may be obtained by the written consent ofthe holders of a majority of the outstanding shares of the Company.

 

## (b)           Any required approvalof the shareholders of the Company shall be solicited substantially inaccordance with Section 14(a) of the Exchange Act and the rules and regulationspromulgated thereunder.

 

# 17.           Informationto Optionees.  The Company shallprovide to each Optionee, during the period for which such Optionee has one ormore Options outstanding, copies of all annual reports to shareholders, proxystatements and other information provided to all shareholders of the Company.

 

6

----