Exhibit 99.2
NON-QUALIFIED STOCK OPTION AGREEMENT
THIS NON-QUALIFIED STOCK OPTION AGREEMENT ("Agreement") is made by
and between Interpharm Holdings, Inc., a Delaware corporation (the
"Corporation"), and ________________ (the "Optionee").
NOW, THEREFORE, in consideration of the mutual benefit to be derived
herefrom, the Corporation and Optionee agree as follows:
1. GRANT OF OPTION. The Corporation hereby grants to Optionee,
subject to all the terms and provisions of the Interpharm Holdings, Inc. 2000
Flexible Stock Plan, as such Plan may be hereinafter amended, a copy of which is
attached hereto and incorporated herein by this reference (the "Plan"), the
right, privilege and option ("Option") to purchase ______________________ shares
of its common stock ("Stock") at $0.682 per share, in the manner and subject to
the conditions provided hereinafter and in the Plan and any amendments thereto
and any rules and regulations thereunder.
2. TIME OF EXERCISE OF OPTION. The Option shall vest in Optionee and
may be exercised by Optionee as set forth on Exhibit "A" hereto. Any exercise
may be with respect to any part or all of the shares then exercisable pursuant
to such Option. Except as otherwise provided in the Plan, such Option must be
exercised within the earlier of (i) 10 years after the date of the grant, or
(ii) three months after Optionee's termination of employment with either the
Corporation, or a Parent or Subsidiary thereof. In no event shall the
Corporation be required to transfer fractional shares to Optionee or those
entitled to Optionee's rights herein.
3. METHOD OF EXERCISE. The Option shall be exercised by payment of
the Option Exercise Price in cash by the Optionee, unless another form of
payment is authorized by the Committee. In the event of payment of the Option
exercise price by check, the Option shall not be considered exercised until
receipt of cleared funds by the Corporation upon deposit of the check.
4. RESTRICTIONS ON EXERCISE AND DELIVERY. The exercise of each Option
shall be subject to the condition that, if at any time the Committee shall
determine, in its sole and absolute discretion,
(a) the satisfaction of any withholding tax or other
withholding liabilities, is necessary or desirable as a condition of, or in
connection with, such exercise or the delivery or purchase of Stock pursuant
thereto,
(b) the listing, registration, or qualification of any shares
deliverable upon such exercise is desirable or necessary, under any state or
federal law, as a condition of, or in connection with, such exercise or the
delivery or purchase of shares pursuant thereto, or
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(c) the consent or approval of any regulatory body is
necessary or desirable as a condition of, or in connection with, such exercise
or the delivery or purchase of shares pursuant thereto,
then in any such event, such exercise shall not be effective unless such
withholding, listing, registration, qualification, consent or approval shall
have been effected or obtained free of any conditions not acceptable to the
Committee. Optionee shall execute such documents and take such other actions as
are required by the Committee to enable it to effect or obtain such withholding,
listing, registration, qualification, consent or approval. Neither the
Corporation nor any officer or director, or member of the Committee, shall have
any liability with respect to the non-issuance or failure to sell shares as the
result of any suspensions of exercisability imposed pursuant to this Section.
5. TERMINATION OF OPTION. Except as otherwise provided in this
Agreement or the Plan, to the extent not previously exercised, the Option shall
terminate upon the first to occur of any of the following events:
(a) the dissolution or liquidation of the Corporation;
(b) the expiration of 10 years from the date of the grant of
the Option hereunder;
(c) the breach by Optionee of any provision of this Agreement;
(d) 90 days after an employee ceases to be employed by the
Corporation, or its Parent or Subsidiary, is no longer an officer or member of
the Board of Directors of the Corporation or no longer performs services for the
Corporation, or its Parent or Subsidiary for any reason; provided, however, that
any option that has not vested in the Optionee as of the termination of
employment shall immediately expire and shall be null and void; Whether an
authorized leave of absence or absence for military or governmental service, or
absence for any other reason, shall constitute termination of eligibility for
purposes of this Section shall be determined in the sole discretion of the
Committee; and
(e) 180 days after the Optionee's death; provided, however,
that any option that has not vested in the Optionee as of the date of death,
shall immediately expire and shall be null and void.
6. NONASSIGNABILITY. Options may not be sold, pledged, assigned or
transferred in any manner other than by will or by the laws of intestate
succession, and may be exercised during the lifetime of Optionee only by
Optionee. Any transfer by Optionee of any Option granted under the Plan or this
Agreement shall void such Option and the Corporation shall have no further
obligation with respect to such Option. No Option shall be pledged or
hypothecated in any way, nor shall any Option be subject to execution,
attachment or similar process.
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7. REPRESENTATION LETTER. Upon the grant of the Option and execution
of this Agreement, the Optionee will deliver to the Corporation the grant
representation letter set forth on Exhibit "B" hereto. Upon exercise of the
Option, the Optionee will deliver to the Corporation the exercise representation
letter set forth on Exhibit "C" hereto, as such Exhibit may be amended by the
Committee from time to time. Optionee also agrees to make such other
representations as are deemed necessary or appropriate by the Corporation and
its counsel.
8. RIGHTS AS SHAREHOLDER. Neither Optionee nor his executor,
administrator, heirs or legatees, shall be, or have any rights or privileges of
a shareholder of the Corporation in respect of the Stock unless and until
certificates representing such Stock shall have been issued in Optionee's name.
9. NO RIGHT OF EMPLOYMENT. Neither the grant nor exercise of any
Option nor anything in the Plan or this Agreement shall impose upon the
Corporation or any other corporation any obligation to employ or continue to
employ any Optionee. The right of the Corporation and any other corporation to
terminate any employee shall not be diminished or affected because an Option has
been granted to such employee.
10. MANDATORY ARBITRATION. In the event of any dispute between the
Corporation and Optionee regarding this Agreement or the Plan, the dispute and
any issue as to the arbitrability of such dispute, shall be settled to the
exclusion of a court of law, by arbitration in New York, New York, by a panel of
three arbitrators (each party shall choose one arbitrator and the third shall be
chosen by the two arbitrators so selected) in accordance with the Commercial
Arbitration Rules of the American Arbitration Association then in effect. The
decision of a majority of the arbitrators shall be final and binding upon the
parties. All costs of the arbitration and the fees of the arbitrators shall be
allocated between the parties as determined by a majority of the arbitrators, it
being the intention of the parties that the prevailing party in such a
proceeding be made whole with respect to its expenses.
11. Definitions. Capitalized terms shall have the meaning set forth
in the Plan unless otherwise defined herein.
12. Notices. Any notice to be given under the terms of this Agreement
shall be addressed to the Corporation in care of its Secretary at its principal
office, and any notice to be given to Optionee shall be addressed to such
Optionee at the address maintained by the Corporation for such person or at such
other address as the Optionee may specify in writing to the Corporation.
13. BINDING EFFECT. This Agreement shall be binding upon and inure to
the benefit of Optionee, his heirs and successors, and of the Corporation, its
successors and assigns.
14. GOVERNING LAW. This Agreement shall be governed by the laws of
the State of New York.
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15. DESCRIPTIVE HEADINGS. Titles to Sections are solely for
informational purposes.
16. APPLICATION OF PLAN. The Corporation has delivered and the
Optionee hereby acknowledges receipt of a copy of the Plan. The parties agree
and acknowledge that the Option granted hereunder is granted pursuant to the
Plan and subject to the terms and provisions thereof, and the rights of the
Optionee are subject to modifications and termination in certain events as
provided in the Plan.
IN WITNESS WHEREOF, this Agreement is effective as of, and the date
of grant shall be May 30, 2003.
INTERPHARM HOLDINGS, INC.,
a Delaware corporation
By: _____________________________
Its:______________________________
OPTIONEE
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Print Name
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EXHIBIT A
VESTING SCHEDULE
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EXHIBIT B
______________, 200__
Interpharm Holdings, Inc.
00 Xxxx Xxxxx
Xxxxxxx, Xxx Xxxx 00000
Re: 2001 Flexible Stock Plan
To Whom It May Concern:
This letter is delivered to Interpharm Holdings, Inc., a Delaware
corporation (the "Corporation"), in connection with the grant to __________ (the
"Optionee") of an option (the "Option") to purchase _____ shares of common stock
of the Corporation (the "Stock") pursuant to the Interpharm Holdings, Inc. 2000
Flexible Stock Plan (the "Plan"). The Optionee understands that the
Corporation's receipt of this letter executed by the Optionee is a condition to
the Corporation's willingness to grant the Option to the Optionee.
In addition, the Optionee makes the following representations and
warranties with the understanding that the Corporation will rely upon them.
1. The Optionee acknowledges receipt of a copy of the Plan and
Agreement. The Optionee has carefully reviewed the Plan and Agreement.
2. The Optionee acknowledges receipt of a prospectus regarding the
Plan which includes the information required by Section (a)(1) of Rule 428 under
the Securities Act of 1933.
3. The Optionee understands and acknowledges that the Option and the
Stock are subject to the terms and conditions of the Plan.
4. The Optionee understands and agrees that, at the time of exercise
of any part of the Option for Stock, the Optionee may be required to provide the
Corporation with additional representations, warranties and/or covenants similar
to those contained in this letter.
5. The Optionee is a resident of the State of __________.
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6. The Optionee will notify the Corporation immediately of any change
in the above information which occurs before the Option is exercised in full by
the Optionee.
The foregoing representations and warranties are given on
______________, 200__ at ________________.
OPTIONEE:
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EXHIBIT C
______________, 200__
Interpharm Holdings, Inc.
00 Xxxx Xxxxx
Xxxxxxx, Xxx Xxxx 00000
Re: 2001 Flexible Stock Plan
To Whom It May Concern:
I (the "Optionee") hereby exercise my right to purchase ________
shares of common stock (the "Stock") of Interpharm Holdings, Inc., a Delaware
corporation (the "Corporation"), pursuant to, and in accordance with, the
Interpharm Holdings, Inc. 2000 Flexible Stock Plan (the "Plan") and Stock Option
Agreement (the "Agreement") dated ________________, 200__. As provided in such
Agreement, I deliver herewith payment as set forth in the Agreement in the
amount of the aggregate option exercise price. Please deliver to me at my
address as set forth above stock certificates representing the subject shares
registered in my name (and (spouse) as (style of vesting)).
The Optionee hereby represents and agrees as follows:
1. The Optionee acknowledges receipt of a copy of the Plan and
Agreement. The Optionee has carefully reviewed the Plan and Agreement.
2. The Optionee is a resident of the State of __________.
3. The Optionee represents and agrees that if the Optionee is an
"affiliate" (as defined in Rule 144 under the Securities Act of 1933) of the
Corporation at the time the Optionee desires to sell any of the Stock, the
Optionee will be subject to certain restrictions under, and will comply with all
of the requirements of, applicable federal and state securities laws.
The foregoing representations and warranties are given on ________ at
_____________________.
OPTIONEE:
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