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EXHIBIT 99.2
DUSA PHARMACEUTICALS, INC.
2006 EQUITY COMPENSATION PLAN
INCENTIVE STOCK OPTION
DUSA Pharmaceuticals, Inc. (the "Company") has granted you an
Incentive Stock
Option (the "Option") under the DUSA Pharmaceuticals, Inc. 2006
Equity
Compensation Plan (the "Plan"). The terms of the grant are set
forth in the
Incentive Stock Option Grant Agreement provided to you (the
"Agreement"). The
following provides a summary of the key terms of the grant;
however, you should
read the entire Agreement, along with the terms of the Plan, to
fully understand
the grant.
SUMMARY OF INCENTIVE STOCK OPTION GRANT
GRANTEE:
_______________________________________________
DATE OF GRANT:
_______________________________________________
VESTING SCHEDULE:
_______________________________________________
EXERCISE PRICE PER SHARE:
_______________________________________________
TOTAL NUMBER OF OPTIONS GRANTED:
_______________________________________________
TERM/EXPIRATION DATE:
_______________________________________________
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DUSA PHARMACEUTICALS, INC.
2006 EQUITY COMPENSATION PLAN
INCENTIVE STOCK OPTION GRANT AGREEMENT
This
INCENTIVE STOCK OPTION GRANT AGREEMENT (the "Agreement"), dated as
of
__________ (the "Date of Grant"), is delivered by DUSA
Pharmaceuticals, Inc.
(the "Company") to _____________ (the "Grantee").
RECITALS
A.
The DUSA Pharmaceuticals, Inc. 2006 Equity Compensation Plan
(the
"Plan") provides for the grant of options to purchase shares of
common stock of
the Company. The Company has decided to make a stock option grant
as an
inducement for the Grantee to promote the best interests of the
Company and its
stockholders. A copy of the Plan is attached.
B.
The Plan is administered by the Compensation Committee of the Board
of
Directors of the Company (the "Committee").
NOW,
THEREFORE, the parties to this Agreement, intending to be
legally
bound hereby, agree as follows:
1. GRANT OF OPTION. Subject to the terms and conditions set forth
in this
Agreement and in the Plan, the Company hereby grants to the Grantee
an Incentive
Stock Option (the "Option") to purchase ___________ shares of
common stock of
the Company ("Shares") at an exercise price of $___________ per
Share. The
Option shall become exercisable according to Paragraph 2 below.
2. EXERCISABILITY OF OPTION. The Option shall become exercisable in
the manner
provided below, if the Grantee is employed by, or providing service
to, the
Employer (as defined in the Plan) on the applicable dates. For this
purpose, the
term "Shares" refers to the number of shares underling that portion
of the
Option that vests in the manner described under Vest Type and Full
Vest Date.
The term "Vest Type" describes how the Option covering those shares
will vest
before the Full Vest Date. For example, if Vest Type is "annual",
that Option
will vest with respect to those shares on a pro rata basis on each
anniversary
of the Date of Grant. The term "Full Vest Date" is the date on
which that
portion of the Option covering all of the corresponding shares set
forth in the
"Shares" column will be fully vested.
<TABLE>
<CAPTION>
Shares Vest Type
Full Vest
Date
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</TABLE>
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The exercisability of the Option is cumulative, but shall not
exceed one hundred
percent (100%) of the Shares subject to the Option. If the
foregoing schedule
would produce fractional Shares, the number of Shares for which the
Option
becomes exercisable shall be rounded down to the nearest whole
Share.
3. TERM OF OPTION.
(a)
The Option shall have a term of seven years from the Date of Grant
and
shall terminate at the expiration of that period, unless it is
terminated at an
earlier date pursuant to the provisions of this Agreement or the
Plan.
(b)
Unless a later termination date is provided for in a
Company-sponsored
plan, policy or arrangement, or any agreement to which the Company
is a party
(as provided in Section 5(f)(v) of the Plan), the Option shall
automatically
terminate upon the happening of the first of the following
events:
(i) The expiration of the ninety (90) day period after the
Grantee
ceases to be employed by, or provide service to, the Employer, if
the
termination is for any reason other than Disability (as defined in
the
Plan), death or Misconduct (as defined in the Plan).
(ii) The expiration of the one (1) year period after the
Grantee
ceases to be employed by, or provide service to, the Employer on
account of
the
Grantee's Disability.
(iii) The expiration of the one (1) year period after the
Grantee
ceases to be employed by, or provide service to, the Employer, if
the
Grantee dies (x) while employed by, or providing service to, the
Employer
or
(y) within ninety (90) days after the Grantee ceases to be so
employed
or
provide such services on account of a termination described in
subparagraph (i) above.
(iv) The date on which the Grantee ceases to be employed by, or
provide service to, the Employer on account of a termination by
the
Employer for Misconduct. In addition, notwithstanding the prior
provisions
of
this Paragraph 3, if the Company determines that the Grantee has
engaged
in
conduct that constitutes Misconduct at any time while the Grantee
is
employed by, or providing service to, the Employer or after the
Grantee's
termination of employment or service, the Option shall terminate as
of date
on
which such Misconduct first occurred.
Notwithstanding the foregoing, in no event may the Option be
exercised after the
date that is immediately before the seventh anniversary of the Date
of Grant.
Any portion of the Option that is not exercisable at the time the
Grantee ceases
to be employed by, or provide service to, the Employer shall
immediately
terminate.
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4. EXERCISE PROCEDURES.
(a)
Subject to the provisions of Parag
