LIFE MEDICAL SCIENCES, INC.
STOCK OPTION AGREEMENT
UNDER THE 2000 NON-QUALIFIED STOCK OPTION PLAN
AGREEMENT entered into as of the date set forth on the signature page
hereto by and between Life Medical Sciences, Inc, a Delaware corporation, with a
principal place of business at 000 Xxxxxxxx Xxxxxx in Edison, New Jersey
(together with its subsidiaries, if any, the "Company"), and the undersigned
(the "Optionee").
WHEREAS, the Company desires to grant to the Optionee a non-qualified
stock option under the Company's 2000 Non-Qualified Stock Option Plan (the
"Plan") to acquire shares of the Company's Common Stock, $.001 par value (the
"Shares"), and
WHEREAS, the Plan provides that each option is to be evidenced by an
option agreement, setting forth the terms and conditions of the option.
NOW THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the Company and the Optionee hereby
agree as follows.
1. Grant of Option
The Company hereby grants to the Optionee a non-qualified stock option
under the Plan (the "Option") to purchase all or any part of an aggregate of the
number of Shares set forth on the signature page to this Agreement on the terms
and conditions hereinafter set forth. The Option shall NOT be treated as an
incentive stock option under Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code").
2. The Purchase Price
The purchase price ("Purchase Price") for the Shares covered by the Option
shall be the dollar amount per share set forth on the signature page to this
Agreement.
3. Time of Vesting and Exercise of Option
Subject to Section 4 hereof, the Option shall vest and become exercisable
on the dates and as to the installment amounts set forth on the signature page
to this Agreement. To the extent the Option (or any portion thereof) is not
exercised by the Optionee when it becomes exercisable, it shall not expire, but
shall be carried forward and shall be exercisable, on a cumulative basis, until
the Expiration Date (as hereinafter defined) or until earlier termination as
hereinafter provided.
4. Term; Extent of Exercisability
(a) Term
(i) The Option shall expire as to each installment amount on the
date set forth next to each such amount on the signature page to this Agreement
(the "Expiration Date"), subject to earlier termination as herein provided.
(ii) Except as otherwise provided in this Section 4, if the Optionee
ceases to perform services for the Company, the Option shall terminate on the
earlier of the last day of the third month or ninety days after the date such
Optionee ceases to perform services for the Company, or on the date on which the
Option expires by its terms, whichever occurs first.
(iii) If such termination to perform services is because of
dismissal for cause or because the Optionee is in breach of any employment
agreement, such Option will terminate on the date the Optionee ceases to perform
services for the Company.
(iv) If such termination to perform services is because the Optionee
has become permanently disabled (within the meaning of Section 22(e)(3) of the
Code), such Option shall terminate on the last day of the twelfth month from the
date such Optionee ceases to perform services for the Company, or on the date on
which the Option expires by its terms, whichever occurs first.
(v) In the event of the death of the Optionee, the Option granted to
such Optionee shall terminate on the last day of the twelfth month from the date
of death, or on the date on which the Option expires by its terms, whichever
occurs first.
(b) Extent of Exercisability
(i) Except as provided below, if the Optionee ceases to perform
services for the Company, the Option shall be exercisable only to the extent
that the right to purchase Shares under such Option has accrued and is in effect
on the date such Optionee ceases to perform services for the Company.
(ii) If the Optionee ceases to perform services for the Company
because he or she has become Permanently Disabled (within the meaning of Section
22(e)(3) of the Code), the Option shall be exercisable to the full number of
Shares covered by such Option.
(iii) In the event of the death of the Optionee, the Option may be
exercised with respect to the full number of Shares covered thereby whether or
not under the provisions of Section 3 hereof the Optionee was entitled to do so
at the date of his or her death, by the estate of such Optionee, or by any
person or persons who acquired the right to exercise such Option by bequest or
inheritance or by reason of the death of such Optionee.
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5. Manner of Exercise of Option
(a) To the extent that the right to exercise the Option has accrued and is
in effect, the Option may be exercised in full or in part by giving written
notice to the Company stating the number of Shares as to which the Option is
being exercised and accompanied by payment in full for such Shares. No partial
exercise may be made for less than one hundred (100) full Shares of Common
Stock. Payment shall be made in accordance with the terms of the Plan. Upon such
exercise, delivery of a certificate for paid-up, non-assessable Shares shall be
made at the principal office of the Company to the person exercising the Option,
not less than thirty (30) and not more than ninety (90) days from the date of
receipt of the notice by the Company.
(b) The Company shall at all times during the term of the Option reserve
and keep available such number of Shares of its Common Stock as will be
sufficient to satisfy the requirements of the Option.
6. Non-Transferability
The right of the Optionee to exercise the Option shall not be assignable
or transferable by the Optionee otherwise than by will or the laws or descent
and distribution or pursuant to a domestic relations order as defined in the
Code or Title 1 of the Employee Retirement Income Security Act or the rules
thereunder, and the Option may be exercised during the lifetime of the Optionee
only by him or her. The Option shall be null and void and without effect upon
the bankruptcy of the Optionee or upon any attempted assignment or transfer,
except as herein provided, including without limitation any purported
assignment, whether voluntary or by operation of law, pledge, hypothecation or
other disposition contrary to the provisions hereof, or levy of execution,
attachment, trustee process or similar process, whether legal or equitable, upon
the Option.
7. Representation Letter and Investment Legend
In the event that for any reason the Shares to be issued upon exercise of
the Option shall not be effectively registered under the Securities Act of 1933,
as amended ("1933 Act"), upon any date on which the Option is exercised in whole
or in part, the person exercising the Option shall give a written representation
to the Company in the form attached hereto as Exhibit 1 and the Company shall
place an "investment legend", so-called, as described in Exhibit 1, upon any
certificate for the Shares issued by reason of such exercise.
8. Adjustments on Changes in Capitalization
Adjustments on changes in capitalization and the like shall be made in
accordance with the Plan, as in effect on the date of this Option.
9. No Special Employment Rights
The provisions of this Section 9 are applicable only to Optionees who are
employees of the Company. Nothing contained in the Plan or this Option shall be
construed or deemed by any person under any circumstances to bind the Company to
continue the employment of the Optionee for the period within which this Option
may be exercised. However, during the period
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of the Optionee's employment, the Optionee shall render diligently and
faithfully the services which are assigned to the Optionee from time to time by
the Board of Directors or by the executive officers of the Company and shall at
no time take any action which directly or indirectly would be inconsistent with
the best interests of the Company.
10. Rights as a Stockholder
The Optionee shall have no rights as a stockholder with respect to any
Shares which may be purchased by exercise of this Option unless and until a
certificate or certificates representing such Shares are duly issued and
delivered to the Optionee. Except as otherwise expressly provided in the Plan,
no adjustment shall be made for dividends or other rights for which the record
date is prior to the date such stock certificate is issued.
11. Withholding Taxes
Whenever Shares are to be issued upon exercise of this Option, the Company
shall have the right to require the Optionee to remit to the Company an amount
sufficient to satisfy all Federal, state and local withholding tax requirements
prior to the delivery of any certificate or certificates for the Shares. The
Company may agree to permit the Optionee to authorize the Company to withhold
Shares of Common Stock purchased upon exercise of the Option to satisfy the
above-mentioned withholding requirement; provided, however, no such agreement
may be made by an Optionee who is an officer or director within the meaning of
Section 16 of the Securities Exchange Act of 1934, as amended, except pursuant
to a standing election to so withhold Shares of Common Stock purchased upon
exercise of the Option, such election to be made in the form set forth in
Exhibit 2 hereto and to be made not less than six (6) months prior to such
exercise. Such election may be revoked only upon providing six (6) months prior
written notice to the Company.
12. Plan Provisions Control
In the event of any inconsistency between the provisions of this Agreement
and the provisions of the Plan, the inconsistent provision(s) of this Agreement
shall be superseded by the Plan provision(s) to the extent necessary to
reconcile the inconsistency.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed,
and the Optionee has hereunto set his or her hand, all as of the _______________
day of ____________________ 2000.
LIFE MEDICAL SCIENCES, INC.
By:_________________________________________
Title:
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OPTIONEE
Print Name: ________________________________
Sign Name: ________________________________
Address: __________________________________
Social Security Number: ___________________
OPTION INFORMATION
Total Number of Shares Underlying Option: _______________
Purchase Price Per Share: ________________
Vesting And Expiration Schedule
Vesting Date Number of Shares Expiration Date
------------ ---------------- ---------------
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EXHIBIT 1
TO STOCK OPTION AGREEMENT
Gentlemen:
In connection with the exercise by me of an option to purchase shares of
Common Stock, $.00l par value, of Life Medical Sciences, Inc (the "Company"), I
hereby acknowledge that I have been informed as follows:
1. The shares of Common Stock of the Company to be issued to me pursuant
to the exercise of said option (the "Shares") have not been registered under the
Securities Act of 1933, as amended (the "Securities Act") and, accordingly, must
be held indefinitely unless the Shares are subsequently registered under the
Securities Act, or an exemption from such registration is available.
2. Routine sales of securities made in reliance upon Rule 144 under the
Securities Act can be made only after the holding period provided by that Rule
has been satisfied, and, in any sale to which that Rule is not applicable,
registration or compliance with some other exemption under the Securities Act
will be required.
3. The availability of Rule 144 is dependent upon adequate current public
information with respect to the Company being available and, at the time that I
may desire to make a sale pursuant to that Rule, the Company may neither wish
nor be able to comply with such requirement.
In consideration of the issuance of certificates for the Shares to me, I
hereby represent and warrant that I am acquiring the Shares for my own account
for investment, and that I will not sell, pledge or transfer the Shares in the
absence of an effective registration statement covering the same, except as
permitted by the provisions of Rule 144 if applicable, or some other applicable
exemption under the Securities Act. In view of this representation and warranty,
I agree that there may be affixed to the certificates for the Shares to be
issued to me, and to all certificates issued hereafter representing the Shares
(until in the opinion of counsel, which opinion must be reasonably satisfactory
in form and substance to counsel for the Company, it is no longer necessary or
required) a legend as follows:
"The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended, and were acquired by the
registered holder pursuant to a representation and warranty that such
holder was acquiring the Shares for his own account and for investment,
with no intention of transfer or disposition of the same in violation of
the registration requirements of that Act. These securities may not be
sold, pledged, or transferred in the absence of an effective registration
statement under such Act, or an opinion of counsel, which opinion is
reasonably satisfactory to counsel to the Company, to the effect that
registration is not required under such Act."
I further agree that the Company may place a stop transfer order with its
transfer agent, prohibiting the transfer of the Shares, so long as the legend
remains on the certificates representing the Shares.
Very truly yours,
Dated:_______________________
EXHIBIT 2
TO STOCK OPTION AGREEMENT
Gentlemen:
The undersigned Optionee hereby elects and agrees that, whenever the
undersigned exercises a stock option (including any options which now or may
hereafter be granted), Life Medical Sciences, Inc. (the "Company") shall
withhold from that exercise such number of Shares equal in value to the Federal
and state withholding taxes due upon such exercise. The undersigned further
acknowledges and agrees that this election may not be revoked without six (6)
months prior written notice to the Company.
OPTIONEE:
________________________________________
(Signature)
________________________________________
(Print Name)
________________________________________
(Social Security Number)
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