NON-QUALIFIED STOCK OPTION AGREEMENT
THIS
NON-QUALIFIED STOCK OPTION AGREEMENT (“Agreement”)
is
made and entered into as of the __ day of ______, 200_ (the “Grant
Date”)
between
Lev
Pharmaceuticals, Inc.,
a
Delaware corporation having a principal place of business at 000 Xxxxx Xxxxxx,
Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000 (“Corporation”),
and
___________
(“Holder”),
with
respect to the following facts:
The
Corporation’s Board of Directors has determined that it is in the best interests
of the Corporation and its stockholders to grant the option provided for herein
to the Holder. The parties agree as follows:
1.
OPTION GRANTED. Corporation
grants to Holder an option ” (the“Option”)
to
purchase the number of shares of $.01 par value common stock of Corporation
(the
“Common
Stock”)
at a
purchase price as described in Appendix
“A.
2.
TIME OF EXERCISE OF OPTION.
Holder
may exercise the Option at any time as described in Appendix
“A”,
and
from time to time until termination of the Option as provided in Paragraph
11 of
this Agreement.
3.
METHOD OF EXERCISE.
The
Holder shall exercise the Option by delivery to the Corporation at its principal
place of business, of (i) a written notice of exercise signed by the person
or
persons exercising the Option specifying the number of Options being exercised;
and (ii) a certified or cashier’s check in payment of the Option purchase price
in U.S. dollars; or (iii) full payment in shares of Corporation’s Common Stock
held for the requisite period necessary to avoid a change to Corporation’s
reported earnings and valued at fair market value as determined pursuant to
Section 2.17 of the Corporation’s 2004 Omnibus Incentive Compensation Plan (the
“Plan”); or (iv) through a cashless exercise program implemented by the
Corporation’s Board of Directors. Promptly upon receipt of such notice of
exercise and the appropriate consideration, the Corporation will deliver or
cause to be delivered to Holder stock certificate(s) representing the number
of
shares of the Corporation’s Common Stock purchased in accordance with the
provisions of this Agreement and during Holder’s lifetime, duly registered in
the name of the Holder and, at the Holder’s election, his or her spouse.
4.
CAPITAL ADJUSTMENTS.
(a) The
existence of the Option shall not affect in any way the right or power of
Corporation or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations, or other changes in Corporation’s capital
structure or its business, or any merger or consolidation of Corporation or
any
issue of bonds, debentures, preferred stock having a preference to or affecting
Corporation’s common stock or of any rights thereof, or the issuance of any
securities convertible into any such common stock or of any rights, options,
or
warrants to purchase any common stock, or the dissolution or liquidation of
Corporation, any sale or transfer of all or any part of its assets or business,
or any other act or proceeding of Corporation, whether of a similar character
or
otherwise.
(b)
The
securities with respect to which the Option is granted are shares of Common
Stock of the Corporation as presently constituted, but if and whenever, prior
to
the delivery by Corporation of all the shares of the common stock with respect
to which the Option is granted, Corporation shall effect a subdivision or
consolidation of shares or other capital readjustment, the payment of a stock
dividend, or other increase or reduction of the number of shares of such common
stock outstanding without receiving compensation therefore in money, services,
or property, the number of shares of such common stock then remaining subject
to
the Option shall (a) in the event of an increase in the number of outstanding
shares of such common stock, be proportionately increased, and the cash
consideration payable per share of such common stock shall be proportionately
reduced; and (b) in the event of a reduction in the number of outstanding shares
of such common stock, be proportionately reduced, and the cash consideration
payable per share of such common stock shall be proportionately increased.
5.
MERGER AND CONSOLIDATION.
In the
event of a merger of one or more corporations with and into Corporation or
any
consolidation of Corporation and one or more corporations, subject to the terms
and conditions of Section 17 of the Plan, this Option may be assumed or an
equivalent option may be substituted by such surviving corporation or a parent
or subsidiary of such surviving corporation.
6.
INVESTMENT UNDERTAKING.
The
Holder will hold the Option and the rights constituent thereto for investment
and not with an intention of distribution, and upon exercise will deliver a
letter confirming the Holder’s nondistributive intent with respect to the shares
of Corporation’s Common Stock received as a result of the exercise of the
Option.
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7.
REPRESENTATIONS OF CORPORATION. During
such time as the Option remains outstanding and unexpired, Corporation will
reserve for issuance, upon the exercise of the Option, the number of shares
of
Corporation’s Common Stock that are subject to the Option. The shares of
Corporation’s Common Stock subject to the Option, when issued, shall be fully
paid and nonasessable. Corporation will pay, when due and payable, any and
all
taxes or fees that may be payable by Corporation with respect to the grant
of
the Option or the issuance of any shares of Corporation’s Common Stock or
certificates therefore subject to the Option. This does not include, however,
any federal, state or other personal income tax payable by Holder because of
(i)
the grant of the Option; (ii) the issuance of any share of the Corporation’s
Common Stock upon exercise thereof; or (iii) any subsequent disposition of
such
shares, which shall remain the obligation of Holder.
8.
WITHOLDING TAXES.
If
Corporation determines that it is required to withhold federal, state, or local
tax as a result of the exercise of the Option, Holder, as a condition to the
exercise of the Option, shall make arrangements satisfactory to the Corporation
to enable it to satisfy such withholding requirements.
9.
COMMITTEE DETERMINATION FINAL.
The
interpretation of this Agreement shall be reserved to and made by the Board
of
Directors of Corporation. The Board’s determinations shall be final as between
the parties hereto.
10.
TRANSFER OF OPTION. During
Holder’s lifetime, the Option shall be exercisable only by Holder. The Option
shall not be transferable by Holder, other than by the laws of descent and
distribution upon Holder’s death.
11.
TERMINATION OF OPTION.
The
Option shall terminate at 5:00 P.M. Eastern time on the date which is described
in Appendix
“A.”
This
Option may sooner terminate in accordance with the terms and conditions
described in Appendix
“A.”
12.
RIGHTS AS A SHAREHOLDER. Holder
will not be deemed to be a holder of any shares of Corporation’s Common Stock
pursuant to the exercise of the Option until Holder pays the purchase price
therefore and a stock certificate is delivered to Holder for those shares.
No
adjustment shall be made for dividends or other rights for which the record
date
is prior to the date such exercise and full payment for the optioned shares.
Nothing
in this Option Agreement shall interfere with or limit in any way the right
of
the Corporation, its Affiliates, and/or its Subsidiaries, to terminate Holder’s
employment at any time or for any reason not prohibited by law, nor confer
upon
Holder any right to continue his or her employment for any specified period
of
time. This Option Agreement shall not constitute an employment contract with
the
Corporation, its Affiliates, and/or its Subsidiaries.
13.
GOVERNING LAW. This
Agreement is granted and delivered in the State of Delaware and is intended
to
be construed and enforced under the laws thereof. The Holder submits to the
exclusive jurisdiction and venue of the federal or state courts of New York,
to
resolve any and all issues that may arise out of or relate to this Option
Agreement.
14.
ADJUSTMENTS.
The
Corporation may make adjustments in the terms and conditions of, and the
criteria included in, this Option in recognition of unusual or nonrecurring
events affecting the Corporation or its financial statements or of changes
in
applicable laws, regulations, or accounting principles, whenever the Corporation
determines that such adjustments are appropriate in order to prevent unintended
dilution or enlargement of the benefits or potential benefits intended to be
made available hereunder. The determination of the Corporation as to the
foregoing adjustments, if any, shall be conclusive and binding on the Holder.
15.
REQUIREMENTS OF LAW.
The
grant of this Option and the issuance of shares of Common Stock upon exercise
of
this Option shall be subject to all applicable laws, rules, and regulations,
and
to such approvals by any governmental agencies or national securities exchanges
as may be required. The Corporation shall have no obligation to issue or deliver
evidence of title for shares of Common Stock which may be issued upon exercise
of this Option prior to: (a) obtaining any approvals from governmental agencies
that the Corporation determines are necessary or advisable; and (b) completion
of any registration or other qualification of such shares of Common Stock under
any applicable national or foreign law or ruling of any governmental body that
the Corporation determines to be necessary or advisable. The inability of the
Corporation to obtain authority from any regulatory body having jurisdiction,
which authority is deemed by the Corporation’s counsel to be necessary to the
lawful issuance and sale of any shares of Common Stock hereunder, shall relieve
the Corporation of any liability in respect of the failure to issue or sell
such
shares of Common Stock as to which such requisite authority shall not have
been
obtained.
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16.
DESIGNATION FOR TAX PURPOSES. It
is
understood and acknowledged by Optionee, that this Option grant is intended
to b
a NQSO. The Optionee is therefore urged to consult with his individual tax
advisor prior to exercising this Grant since the exercise of this Grant may
result in adverse tax consequences including the payment of additional federal
and/or state income taxes.
17.
CERTAIN DEFINITIONS.
Capitalized terms used herein, to the extent not defined in this Non-Qualified
Stock Option Agreement shall have the meanings ascribed to such term in the
Plan.
18.
GENERAL PROVISIONS.
Subject
to the terms of the Plan, this Option constitutes the entire agreement of the
parties and supersede all prior undertakings and agreements with respect to
the
subject matter hereof. Except where otherwise indicated by the context, any
masculine term used herein also shall include the feminine, the plural shall
include the singular, and the singular shall include the plural. In the event
any provision of this Agreement shall be held illegal or invalid for any reason,
the illegality or invalidity shall not affect the remaining parts of this
Agreement and this Agreement shall be construed and enforced as if the illegal
or invalid provision had not been included. No fractional shares of Common
Stock
shall be issued or delivered pursuant to this Option. The Corporation shall
determine whether cash or other property shall be issued or paid in lieu of
fractional shares of Common Stock or whether such fractional shares or any
rights thereto shall be forfeited or otherwise eliminated.
IN
WITNESS THEREOF, the parties have made and entered into this Agreement in
duplicate on the date specified in its preamble.
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CORPORATION
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XXXXXX
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XXX
PHARMACEUTICALS, INC.,
a
Delaware corporation
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By:
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Chief
Executive Officer
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APPENDIX
“A”
Holder
Name:
Number
of Options Granted:
Option
Price:
Vesting
Commencement Date:
Subject
to the terms and conditions set forth in this Option, this Option may be
exercised to purchase the shares of Common Stock covered by this Option (the
“Shares”) as follows:
Option
Expiration Date:
Termination
Provisions:
(a) Termination
without Cause or by Holder:
Notwithstanding the foregoing, in the event of a termination of Holder’s
employment with the Corporation by the Corporation without Cause (as defined
below) or in the event of the termination of Holder’s employment with the
Corporation by Holder, Holder’s right to purchase shares of Common Stock of the
Corporation pursuant to this Option, solely to the extent vested as of the
date
of termination of Holder’s employment with the Corporation, shall remain
exercisable for a period of three months following such termination date, but
in
no event after the Option Expiration Date.
“Cause”
shall
mean any of the following resulting from an act or omission of the Holder:
(i)
fraud, embezzlement, felony or similar act; (ii) failure to substantially
perform duties as an employee or to abide by the general policies of the
Corporation applicable to all employees (including, without limitation, policies
relating to confidentiality and reasonable workplace conduct); (iii) an act
of
moral turpitude, or any similar act, to the extent that such act causes injury
to the reputation of the Corporation; (iv) any act or omission which in the
reasonable opinion of the Company could be financially injurious to the
Corporation or injurious to the business reputation of the Corporation; (v)
excessive absences from work, other than for illness or disability; or (vi)
any
other act constituting cause under any agreement entered into between the Holder
and the Corporation.
(b) Termination
for Cause:
In the
event of a termination of Holder’s employment with the Corporation by the
Corporation for Cause, all Options granted but not exercised as of the date
of
termination of Holder’s employment with the Corporation shall terminate
immediately and be null and void.
(c) Death
or Disability:
In the
event of a termination of Holder’s employment with the Corporation due to
Holder’s death, or Disability (as defined in Section 22(E)(3) of the Internal
Revenue Code of 1986, as amended), the Holder’s (or her estate’s or legal
representative’s) right to purchase shares of Common Stock of the Corporation
pursuant to this Option, to the extent vested as of the date of termination
of
Holder’s employment with the Corporation, shall remain exercisable for a period
of twelve (12) months following such termination date, but in no event after
the
Option Expiration Date.
(d) Unvested
Options:
Unless
otherwise specified in this Option certificate, each unvested Option granted
pursuant hereto shall terminate immediately upon termination of the Holder’s
employment or contractual relationship with the Corporation for any reason
whatsoever, including Disability.
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