Document:

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                              [Letterhead]

                                                                 Exhibit 10.12

                                                     November 4, 1999

Mr. James G. Thomasch
One Rosebud Lane
Westford, MA  01886

Dear Jim:

         It is my pleasure to offer you the opportunity to join the PLC Medical
Systems ("PLCM") team. I am pleased to offer you employment on the following
terms:

         1.       TITLE AND POSITION: Senior Vice President of Finance and
                  Administration and Chief Financial Officer reporting to the
                  Chief Executive Officer.

         2.       BASE SALARY: $6,153.85 biweekly or $160,000 annualized. Salary
                  reviews are performed annually in December with increases
                  January 1st. Your first scheduled review will be in December
                  2000.

         3.       BONUS: You will be eligible for a bonus targeted at 40 percent
                  based on performance goals to be agreed upon with the Chief
                  Executive Officer. For 1999, your bonus will be pro-rated
                  without performance goals.

         4.       FRINGE BENEFITS: You will be eligible to receive such benefits
                  as are generally provided to other employees in accordance
                  with PLCM policy as then in effect from time to time. PLCM
                  retains the right to change, add or cease a particular
                  benefit. We have agreed that you will receive four (4) weeks
                  paid vacation (to be taken at mutually satisfactory times). In
                  addition, present benefits include medical, dental, long term
                  disability, short term disability and life insurance benefits
                  as well as participation in PLCM's 401(k) plan after
                  completing one full calendar quarter. In addition, you will
                  receive a non-accountable car allowance of $1,000 per month.

         5.       STOCK OPTIONS: A proposal will be made to the Board of
                  Directors, at a meeting to be held on November 8, 1999, to
                  approve an incentive stock option grant for 125,000 shares of
                  common stock. The exercise price of incentive stock options
                  would be the fair market value of the stock on the date of the
                  grant and the option would vest 20% on hiring and 20% on each
                  anniversary date. Any stock option grant is subject to the
                  approval of the Board of Directors of PLCM and to your
                  execution and compliance with a standard stock option
                  agreement and your compliance with the applicable Stock Option
                  Plan. I will discuss with you and the Board an accelerated
                  vesting schedule based on performance of PLC Stock. Your
                  options will accelerate upon change of control or termination
                  without cause, subject to usual requirements of time to
                  exercise options.

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James G. Thomasch
November 4, 1999
Page 2

         6.       NON-COMPETITION: In consideration of your employment by PLCM,
                  you agree to enter into the Non-competition, Proprietary
                  Information and Inventions Agreement attached to this letter.
                  By agreeing to these terms, you are, of course, also
                  warranting to PLCM that you are free and able to join us and
                  are not subject to any prior employment restrictions that
                  would prohibit you from devoting your full energies to PLCM.

         7.       SMOKING: PLC Medical Systems is a smoke free facility.

         8.       SEVERANCE BENEFITS: If your employment with PLCM is terminated
                  (i) by PLCM without "cause" (as defined below) or (ii) by you
                  for "good reason" (as defined below) within 12 months after a
                  "change of control" (as defined below), PLCM shall pay you an
                  amount (the "Severance Amount") equal to one times your
                  highest annualized base salary plus bonus during the
                  three-year period prior to such termination, plus benefit
                  continuation for one year. One-third of the Severance Amount
                  shall be paid within five days of such termination and the
                  remaining two-thirds shall be paid in nine equal installments
                  over a nine month period following such termination.

                  For purposes of this Paragraph No. 8, "Cause" means (a) a good
                  faith finding by PLCM that (i) you have failed to perform your
                  reasonably assigned duties for PLCM and have failed to remedy
                  such failure within 10 days following written notice from the
                  PLCM to you notifying you of such failure, or (ii) you have
                  engaged in dishonesty, gross negligence or misconduct, or (b)
                  your conviction of, or the entry of a pleading of guilty or
                  nolo contendere by you to, any crime involving moral turpitude
                  or any felony.

                  For purposes of this Paragraph No. 8, "good reason" means, in
                  summary: (i) a diminution in your position, authority or
                  responsibilities; (ii) a material reduction in your salary or
                  benefits; or (iii) your relocation more than [30] miles from
                  Franklin, Massachusetts.

                  For purposes of this Paragraph No. 8, "Change in Control"
                  means, in summary: (i) the acquisition by a party or a group
                  of 35% or more of the outstanding stock of PLCM; (ii) a
                  change, without Board of Directors approval, of a majority of
                  the Board of Directors (whether occurring on one date or over
                  time); (iii) the acquisition of PLCM by means of a
                  reorganization, merger, consolidation or asset sale; or (iv)
                  the approval of a liquidation or dissolution of PLCM.

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James G. Thomasch
November 4, 1999
Page 3

         This letter, together with the Non-competition, Proprietary Information
and Inventions Agreement, constitutes our entire offer regarding the terms and
conditions of your prospective employment by PLCM. It supersedes any prior
agreements, or other promises or statements (whether oral or written) regarding
the offered terms of employment. The terms of your employment shall be governed
by the law of the Commonwealth of Massachusetts.

         As discussed, I would like you to start on November 7, 1999, however,
this offer will remain open for two weeks.

         If these terms are agreeable to you, please sign and return the copy of
this letter enclosed for that purpose.

         Jim, I look forward to working with you and am excited at the prospect
of having you help PLC reach its potential.

                                         Very truly yours,

                                         /s/ Edward H. Pendergast
                                         -------------------------------------
                                         Edward H. Pendergast
                                         Chairman, President and
                                         Chief Executive Officer

Agreed and Accepted:

/s/ James G. Thomasch
----------------------------
James G. Thomasch<PAGE>

                                [Letterhead]

                                                                 Exhibit 10-13

December 22, 1999

Mr. Mark R. Tauscher
22421 NE 140th Way
Woodinville, WA 98072

Dear Mark:

I am delighted you have accepted our of employment to join the PLC Medical
Systems ("PLCM") team as of December 17, 1999 on the following terms:

         1)       TITLE AND POSITION: President, Chief Executive Officer and
                  Member of the Board of Directors reporting to the Board of
                  Directors.

         2)       BASE SALARY: $9,615.39 biweekly or $250,000 annualized. Since
                  you will be on vacation until January 17th, 2000, PLCM will
                  pay you $1,000 until that date when your compensation will be
                  at the $250,000 per year salary. Salary reviews are performed
                  annually in December with increases January 1st. Your first
                  scheduled review will be in December 2000.

         3)       BONUS: You will be eligible for a bonus targeted at 50% based
                  on performance goals to be agreed upon initially with the
                  Chairman. The bonus will start at 70% achievement level and
                  may exceed 50%. The first year bonus will be calculated on
                  mutually agreed achievable goals.

         4)       FRINGE BENEFITS: You will be eligible to receive such benefits
                  as are generally provided to other employees in accordance
                  with PLCM policy as then in effect from time to time. PLCM
                  retains the right to change, or cease a particular benefit.
                  Present benefits include two weeks paid vacation earned on a
                  monthly basis (to be taken at mutually satisfactory times),
                  medical, dental, short and long term disability and life
                  insurance benefits, and participation in PLCM's 401(k) plan
                  after completing one full calendar quarter. In addition, PLCM
                  will pay for your COBRA benefits for 3 to 6 months while your
                  family is in Washington. You will receive an automobile
                  allowance of $1,000 per month. Your vacation will be four
                  weeks.

         5)       STOCK OPTIONS: The Board of Directors has approved a stock
                  option grant for you for 350,000 shares of PLCM common stock,
                  which vest 20% upon onset of employment and 5% per quarter on
                  quarterly anniversary date of the

<PAGE>

Mark R. Tauscher
December 22, 1999
Page 2

                  commencement of employment. The exercise price of incentive
                  stock options is the fair market value of the stock on the
                  date of the grant. Any stock option grant is subject to your
                  execution and compliance with the applicable Stock Option Plan
                  and form of stock option agreement in effect at the time of
                  the grant. The options will be allocated to Incentive Stock
                  Options to the extent allowed, with the balance being
                  non-qualified options. The Board will consider annual
                  increases of up to 50,000 shares based on performance.

         6)       NON-COMPETITION: In consideration of your employment by PLCM,
                  you agree to enter into the Non-competition, Proprietary
                  Information and Inventions Agreement ("the Agreement")
                  attached to this letter. By agreeing to these terms, you are,
                  of course, also warranting to PLCM that you are free and able
                  to join us and are not subject to any prior employment
                  restrictions that would prohibit you from devoting your full
                  energies to PLCM. It is understood that the Agreement would
                  not prohibit you from employment with a competitor if you are
                  employed in an area unrelated to our business as defined in
                  the Agreement.

         7)       SMOKING: PLC Medical Systems is a smoke free facility.

         8)       RELOCATION: PLCM will pay for your reasonable moving expenses,
                  including cost of moving, cost of selling your house in
                  Washington, closing costs of buying a house in Massachusetts,
                  cost of flying family here and a reasonable number of house
                  hunting trips and will include a gross up of non-deductible
                  expenses. We will attempt to utilize a relocation service if
                  it will provide tax benefit to PLCM without impacting your tax
                  situation. If needed, PLCM will arrange a bridge loan for the
                  time between purchase of a home in Massachusetts and sale of
                  your home in Washington [which bridge loan will be secured by
                  a mortgage on your home in Washington].

         9)       SEVERANCE BENEFITS: If your employment with PLCM is terminated
                  (i) by PLCM without "Cause" (as defined below) or (ii), for
                  "Good Reason" (as defined below) with [12] months after a
                  Change of Control (as defined below), PLCM shall pay you
                  one-half of the Severance Amount (as defined below) on
                  termination of your employment with PLCM, and the other half
                  of the Severance Amount shall be payable in nine equal
                  installments over a nine month period following such
                  termination.

                  For purposes of this Paragraph 9, "Cause" means (a) good faith
                  finding by PLCM that (i) you have failed to perform your
                  reasonably assigned duties for PLCM [and have failed to remedy
                  such failure within 10 days following written notice from PLCM
                  to you notifying you of such failure], or (ii) you have

<PAGE>

Mark R. Tauscher
December 22, 1999
Page 3

                  engaged in dishonesty, gross negligence or misconduct, or (b)
                  your conviction of, or the entry of as pleading of guilty or
                  nolo contendere by you to, any crime involving moral turpitude
                  or any felony. Under (a) (i) your Severance Amount will be
                  reduced by one-half the amount paid if your employment is
                  terminated without "cause" Under (a) (ii) and (b) you will be
                  paid no Severance Amount.

                  For purposes of this Paragraph No. 9, the "Severance Amount"
                  means an amount equal to the product of 1.5 and the sum of (a)
                  your highest annualized base salary during the three-year
                  period prior to the termination of your employment with PLCM
                  (the "Applicable Base Salary") and (b) your previous calendar
                  year's bonus (or, if you have been employed by PLCM for less
                  than one year, a bonus equal to 50% of the Applicable Base
                  Salary)

                  For purposes of this Paragraph No. 9, "Good Reason" means, in
                  summary: (i) a diminution in your position, authority or
                  responsibilities; (ii) a material reduction in your salary or
                  benefits; or (iii) your relocation more than [100] miles from
                  Franklin, Massachusetts.

                  For purposes of the Paragraph No. 9, "Change of Control"
                  means, in summary: (i) the acquisition by a party or a group
                  of 35% or more of the outstanding stock of PLCM; (ii) a
                  change, without Board of Directors approval, of a majority of
                  the Board of Directors (whether occurring on one date or over
                  time); (iii) the acquisition of PLCM by means of a
                  reorganization, merger, consolidation or asset sale; or (iv)
                  the approval of a liquidation or dissolution of PLCM.

This letter, together with the Non-Competition, Proprietary Information and
Inventions Agreement, constitutes our entire offer regarding the terms and
conditions of your employment by PLCM. It supersedes any prior agreements, or
other promises or statements (whether oral or written) regarding the offered
terms of employment. The terms of your employment shall be governed by the law
of the Commonwealth of Massachusetts. By accepting this offer of employment, you
agree that any action, demand, claim or counterclaim concerning any aspect of
your employment relationship with PLCM shall be governed by the internal laws of
the Commonwealth of Massachusetts (excluding the conflicts of law principles
thereof).

We agree that your employment with PLCM commence effective as of December 17,
1999. We understand you will be taking a vacation through January 16th and will
pay you $1,000 for that time. We look forward to your return on January 17,
2000.

If these terms are agreeable to you, please sign and return the copy of this
letter enclosed for that purpose.

<PAGE>

Mark R. Tauscher
December 22, 1999
Page 4

Mark, I am very enthusiastic about you becoming President and CEO of PLCM and
look forward to working with you.

Sincerely,

/s/ Edward H. Pendergast
-------------------------------
Edward H. Pendergast
President

Enclosures

Agreed:

/s/ Mark R. Tauscher
-------------------------------
Mark R. Tauscher

Date: 12-23-99

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