Document:

Exhibit 10.2

 

Form of
Stock Option Grant Letter for Employees

 

[Date of Grant]

 

[Name]

[Address]

[City, State Zip]

 

Dear [Optionee],

 

I am pleased to advise you that PLC Systems
Inc. (the “Company”) has, on this date, pursuant to its 2005 Stock Incentive Plan
(the “Plan”), awarded you [an incentive stock option/a nonstatutory stock
option] to purchase                       shares
of the Common Stock, no par value per share, of the Company, at a price of $         per
share.

 

In addition to the terms of the Plan, the
following terms and conditions are applicable with respect to this option, and
your signature below shall constitute your acknowledgement and acceptance of
same:

 

1.             This
option shall not be transferable under any circumstances except by operation of
law.

 

2.             The
price at which this option may be exercised shall be $         per
share.

 

3.             This option is
subject to the following terms:

 

(a)           Should
your employment with the Company (or a parent or subsidiary of the Company) be
terminated for any reason other than death or disability (as defined in the
Internal Revenue Code of 1986, as amended (the “Code”)) or for “Cause” (as
defined below), all unexercised options shall terminate 90 days after the date
of your termination (but in no event after 10 years from the date of grant), provided
that this option shall be exercisable only to the extent that you were entitled
to exercise this option on the date of such cessation of employment.

 

(b)           In the event of
termination of your employment as a result of your death, the outstanding
options exercisable by you at the date of your death may be exercised by your
estate until one year from the date of your death (but in no
event after 10 years from the date of grant), provided that this option
shall be exercisable only to the extent that this option was exercisable by you
on the date of your death.

 

(c)           In
the event of termination of your employment as a result of your disability (as
defined in the Code), all outstanding options exercisable by you at the date of
such termination shall terminate one year from the date your employment
terminates (but in no event after 10 years from the date of grant), provided
that this option shall be exercisable only to the extent that this option was
exercisable by you on the date of your disability.

 

(d)           If
you are discharged by the Company for “Cause” (as defined below), the right to
exercise this option shall terminate immediately upon the effective date of
such discharge.

 

 

“Cause” shall mean your willful misconduct or
willful failure to perform your responsibilities to the Company (including,
without limitation, your breach of any provision of any employment, consulting,
advisory, nondisclosure, non-competition or other similar agreement between you
and the Company), as determined by the Company, which determination shall be
conclusive.

 

(e)           If
you violate the non-competition or confidentiality provisions of any employment
contract, confidentiality and nondisclosure agreement or other agreement
between you and the Company, the right to exercise this option shall terminate
immediately upon written notice to you from the Company describing such
violation.

 

4.             This
option may be exercised in whole or in part from time to time; provided,
however, that an option may not be exercised as to less than 100 shares
at any one time unless it is being exercised in full and the balance of the
shares subject to the option is less than 100. 
Each election to exercise this option shall be in writing, signed by
you, and received by the Company at its principal office, accompanied by this
letter, and payment in full in the manner provided in the Plan.

 

5.             The
shares of Common Stock underlying this option and the exercise price therefore
shall be appropriately adjusted from time to time for stock splits, reverse
splits, stock dividends and reclassifications of shares in accordance with the
Plan.

 

6.             [In
the event of a Reorganization Event (as defined in the Plan), the Company shall
give prior notice of such an event to you, and you may exercise up to 100% of
this option as of a time specified in such notice.  If you do not exercise the option prior to
the consummation of the Reorganization Event, all unexercised portions of this
option shall terminate and be of no further force or effect.] Note: This clause may be
inserted at the discretion of the Company’s Board of Directors.

 

7.             Notwithstanding anything contained herein to the contrary
[(except paragraph (6) hereof)], the maximum number of shares of options
that may be exercised is as follows:

 

	
  Period

  	
   

  	
  Number of

  Options Exercisable

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

8.             No
shares will be issued pursuant to the exercise of this option unless and until
you pay to the Company, or make provision satisfactory to the Company for
payment of, any federal, state or local withholding taxes required by law to be
withheld in respect of this option.

 

9.             This
option may not be sold, assigned, transferred, pledged or otherwise encumbered
by you, either voluntarily or by operation of law, except by will or the laws
of descent and distribution, and, during your lifetime, this option shall be
exercisable only by you.

 

10.           Unless
earlier terminated, this option will expire 10 years from the date of grant.

 

11.           This
option is subject to the provisions of the Plan, a copy of which is furnished
to you with this option.

 

2

 

When you wish to exercise this stock option,
please refer to the provisions of this letter and the Plan and then correspond
in writing with the Chief Financial Officer of the Company. Further, please
indicate your acknowledgment and acceptance of this option by signing the
enclosed copy of this letter and returning it to the undersigned or                           within
30 days of your receipt of this grant.

 

 

	
   

  	
  Sincerely,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Mark R. Tauscher,

  
	
   

  	
  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  ACKNOWLEDGEMENT AND CONSENT:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Optionee

  	
   

  
			

 

3Exhibit 10.3

 

Form of
Stock Option Grant Letter for Non-Employee Directors

 

[Date of Grant]

 

 

[Name]

[Address]

[City, State Zip]

 

Dear [Optionee],

 

I am pleased to advise you that PLC Systems
Inc. (the “Company”) has, on this date, pursuant to its 2005 Stock Incentive
Plan (the “Plan”), awarded you a nonstatutory stock option to purchase                            shares
of the Common Stock, no par value per share, of the Company, at a price of $                per
share.

 

In addition to the terms of the Plan, the
following terms and conditions are applicable with respect to this option, and
your signature below shall constitute your acknowledgement and acceptance of
same:

 

1.             This
option shall not be transferable under any circumstances except by operation of
law.

 

2.             The
price at which this option may be exercised shall be $          per
share.

 

3.             This option is
subject to the following terms:

 

(a)           Should
your service as a Director of the Company terminate for any reason other than
death or disability (as defined in the Internal Revenue Code of 1986, as
amended (the “Code”)), all of your unvested options shall terminate
immediately.

 

(b)           In the event your
service as a Director of the Company terminates as a result of your death, the
outstanding options exercisable by you at the date of your death may be
exercised by your estate until one year from the date of your death (but in no
event after 10 years from the date of grant), provided that this option
shall be exercisable only to the extent that this
option was exercisable by you on the date of your death.

 

(c)           In
the event your service as a Director of the Company terminates as a result of
your disability (as defined in the Code), the outstanding options exercisable
by you at the date of such termination may be exercised until one year from the
date of such termination (but in no event after 10 years from the date of
grant), provided that this option shall be exercisable only to the
extent that this option was exercisable by you on the date of your disability.

 

4.             This
option may be exercised in whole or in part from time to time; provided,
however, that an option may not be exercised as to less than 100 shares
at any one time unless it is being exercised in full and the balance of the
shares subject to the option is less than 100. 
Each election to exercise this option shall be in writing, signed by
you, and received by the Company at its principal office, accompanied by this
letter, and payment in full in the manner provided in the Plan.

 

 

5.             The
shares of Common Stock underlying this option and the exercise price therefore
shall be appropriately adjusted from time to time for stock splits, reverse
splits, stock dividends and reclassifications of shares in accordance with the
Plan.

 

6.             [In
the event of a Reorganization Event (as defined in the Plan), the Company shall
give prior notice of such an event to you, and you may exercise up to 100% of
this option as of a time specified in such notice.  If you do not exercise the option prior to
the consummation of the Reorganization Event, all unexercised portions of this
option shall terminate and be of no further force or effect.] Note: This clause may be
inserted at the discretion of the Company’s Board of Directors.

 

7.             Notwithstanding anything contained herein to the contrary
[(except paragraph (6) hereof)], the maximum number of shares of options
that may be exercised, subject to your continued service as a Director of the
Company, is as follows:

 

	
  Period

  	
   

  	
  Number of

  Options Exercisable

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

8.             No
shares will be issued pursuant to the exercise of this option unless and until
you pay to the Company, or make provision satisfactory to the Company for
payment of, any federal, state or local withholding taxes required by law to be
withheld in respect of this option.

 

9.             This
option may not be sold, assigned, transferred, pledged or otherwise encumbered
by you, either voluntarily or by operation of law, except by will or the laws
of descent and distribution, and, during your lifetime, this option shall be
exercisable only by you.

 

10.           Unless
earlier terminated, this option will expire 10 years from the date of grant.

 

11.           This
option is subject to the provisions of the Plan, a copy of which is furnished
to you with this option.

 

When you wish to exercise this stock option,
please refer to the provisions of this letter and the Plan and then correspond
in writing with the Chief Financial Officer of the Company. Further, please
indicate your acknowledgment and acceptance of this option by signing the
enclosed copy of this letter and returning it to the undersigned or                                   within
30 days of your receipt of this grant.

 

 

	
   

  	
  Sincerely,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Mark R. Tauscher,

  
	
   

  	
  President and Chief Executive Officer

  
	
   

  	
   

  
	
  ACKNOWLEDGEMENT AND CONSENT:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Optionee

  	
   

  
			

 

2

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