Exhibit
10.1
AVICENA GROUP,
INC.
Non-Qualified Stock Option
Agreement
Avicena Group, Inc., a Delaware
corporation (the “ Company ”), hereby grants to
[ ]
(the “ Optionee ”), an option to purchase a
maximum of
[ ]
shares (the “ Option Shares ”) of its Common
Stock, $.001 par value (“ Common Stock ”), at
the price of
$[ ]
per share (the “ Option Price ”), on the
following terms and conditions:
1. Grant Under 1999 Stock
Incentive Plan . This option is granted pursuant to and is
governed by the Company’s 1999 Stock Incentive Plan (the
“ Plan ”), as amended from time to time, and,
unless the context otherwise requires, capitalized terms used
herein, but not defined herein, shall have the same meaning as in
the Plan. Determinations made in connection with this option
pursuant to the Plan shall be governed by the Plan as it exists on
the date set forth above.
2. Grant as Non-Qualified
Option; Other Options . This option shall be treated for
federal income tax purposes as a Non-Qualified Stock Option (rather
than an incentive stock option). This option is in addition to any
other options heretofore or hereafter granted to the Optionee by
the Company.
3. Grant Date; Vesting of
Option; Term; Exercise .
a) Grant Date . The Grant
Date of this option is
[ ].
b) Vesting . This option
shall vest in equal semi-annual installments over the period of
three years from the Grant Date, provided that the Optionee
continues to serve the Company in the capacity of an employee,
officer, director or consultant (such service is described herein
as maintaining or being involved in a “Business
Relationship” with the Company). Accordingly, on and after
each semi-annual anniversary of the Grant Date, the Optionee may
exercise this option for
[ ]
shares of Common Stock (plus any installments which have previously
vested). Notwithstanding the foregoing, in accordance with and
subject to the provisions of the Plan, the Committee may, in its
sole discretion, accelerate the date that any installment of this
option becomes vested. The foregoing rights are cumulative and
(subject to subsections (c), (d) and (f) of this
Section 3), once vested, may be exercised up to and including
the date which is ten years from the Grant Date (the “
Expiration Date ”).
c) Term . The term of the
option shall extend from the Grant Date to the Expiration Date (the
“Term”). Upon expiration of the Term, the option shall
no longer be exercisable whether or not previously
vested.
d) Termination of Business
Relationship . If the Optionee’s Business Relationship
with the Company is terminated for any reason whatsoever (including
by death or disability) prior to the expiration of the Term, no
further installments of this option shall become vested. In such a
case, the Optionee’s only rights hereunder shall be to
exercise those installments of this option that became vested prior
to the termination of Optionee’s Business Relationship with
the Company. Optionee (or, in the case of Optionee’s death or
disability, his or her beneficiary, estate or personal
representative, as the case may be) shall be allowed to exercise
any vested portion of the option for ninety (90) days
following the date of the
termination, but not to exceed the expiration of
the Term. Any installments of this option which have not become
vested on or before the date of the termination of Optionee’s
Business Relationship with the Company shall be forfeited and
cancelled and the Optionee shall not be entitled to any benefit in
lieu thereof.
e) Method of Exercising
Option . Subject to the terms and conditions of this Agreement,
this option shall be exercised by written notice to the Company, at
the principal executive office of the Company, or to such transfer
agent as the Company shall designate. Such notice shall state the
election to exercise this option and the number of Option Shares
for which it is being exercised and shall be signed by the Optionee
(or, in the case of Optionee’s death or disability, his or
her beneficiary, executor or personal representative). Such notice
shall be accompanied by payment of the full purchase price of such
shares. Notwithstanding the foregoing to the contrary, the Optionee
may, in his or her sole discretion, elect to exercise this option
through a “net settlement exercise.” A net settlement
exercise shall be affected by the Optionee submitting a written
notice of such exercise to the Company. Upon receipt of notice of a
net settlement exercise, the Company shall withhold that number of
shares of Common Stock, determined by reference to the Fair Market
Value (as defined in subsection (h) of this Section 3) of
the Common Stock on the date such notice of exercise is received by
the Company, necessary to satisfy the full exercise price of the
option (or portion thereof being exercised). Any withholding of
shares pursuant to Section 11 of this Agreement shall be in
addition to the share withholding described in this subsection (e).
The Company shall deliver a certificate or certificates
representing the Option Shares, bearing such legends as may be
required pursuant to Sections 5 and 6 of this Agreement, as soon as
practicable after a notice of exercise has been received. Such
certificate or certificates shall be registered in the name of the
Optionee or a Permitted Transferee (as defined in Section 5(a)
below) (or in the name of the Optionee and a Permitted Transferee
jointly, with right of survivorship).
f) Partial Exercise . This
option may be exercised in part at any time and from time to time,
except that this option may not be exercised for a fraction of a
share of Common Stock unless such exercise is with respect to the
final installment of Common Stock subject to this option and cash
in lieu of a fractional share must be paid to permit the Optionee
to exercise completely such final installment. Any fractional share
with respect to which an installment of this option cannot be
exercised because of the limitation contained in the preceding
sentence shall remain subject to this option and shall be available
for later purchase by the Optionee in accordance with the terms of
this Agreement.
g) Payment of Price . The
option price shall be paid in cash, by check, with shares of Common
Stock as described in subsection (e) of this Section 3 or
by any other means permitted under the Plan and approved in advance
by the Company.
h) Fair Market Value . For
purposes of this Agreement, “ Fair Market Value
” shall mean, with respect to a share of Common Stock as of a
relevant date, the average of the closing prices of the sales of
the Common Stock on all securities exchanges on which such
securities may at the time be listed on that date, or, if there
have been no sales on the exchanges on which the security is listed
on any day, the average of the highest bid and lowest asked prices
on all nationally-recognized exchanges at the end of such day, or,
if on any day such security is not so listed, the average of the
representative bid and asked prices quoted in the NASDAQ
System as of 4:00 P.M., New York time, or, if on
any day such security is not quoted in the NASDAQ System, of the
average of the highest bid and lowest asked prices on such day on
the OTC Bulletin Board or in the domestic over-the-counter market
as reported by the National Quotation Bureau Incorporated, or any
similar successor organization, in each such case averaged over a
period of 21 days consisting of the day as of which the Fair Market
Value is being determined (or, if such day is not a business
d
