EXHIBIT 10.1
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STOCK OPTION AGREEMENT
AGREEMENT dated as of September 7, 2005, by and between JAVELIN
PHARMACEUTICALS, INC., a Delaware corporation (the "Company"), and
_________________ (the "Optionee"). ------- --------
W I T N E S S E T H
WHEREAS, the Optionee, as part of his/her employment with Innovative Drug
Delivery Systems, Inc., a Delaware corporation ("IDDS"), had been granted an
Employee Founders Option for the purchase of ______ shares of IDDS Common
Stock at an exercise price of $____ per share, expiring on _________ (the
"Founders Option"); ________________
WHEREAS, effective December 6, 2004, pursuant to an Agreement and Plan of
Merger among IDDS, Intrac, Inc., a Nevada corporation ("Intrac") and a
wholly-owned subsidiary of Intrac, IDDS became a subsidiary of Intrac, and
Intrac agreed to assume all outstanding options to purchase IDDS Common Stock,
including the Founders Option, on the same terms as the respective IDDS options,
except exercisable for shares of Intrac Common Stock, $.001 par value (the
"Intrac Common Stock") with the number of option shares and the exercise price
adjusted for the Intrac merger ratio;
WHEREAS, effective September 7, 2005, pursuant to an Agreement and Plan of
Merger between Intrac and the Company, a wholly-owned subsidiary of Intrac,
Intrac merged with and into the Company on a share-for-share exchange, and the
Company agreed to assume all outstanding options to purchase Intrac Common Stock
on the same terms as the Intrac options, except exercisable for share of the
Company's Common Stock, $.001 par value (the "Common Stock"); and
WHEREAS, the Optionee and the Company desire to set forth the terms and
conditions of the options issuable by the Company to the Optionee in exchange
for his/her Founders Option, and subsequently assumed Intrac options;
NOW, THEREFORE, in consideration of the premises, the mutual covenants
herein set forth and other good and valuable consideration, the Company and the
Optionee hereby agree as follows;
1. Grant of Option. In exchange for the Optionee's Founders Option, as
assumed by Intrac, and subject to the terms and conditions herein, the Company
hereby grants to the Optionee an option (the "Option") to purchase an aggregate
of ______ shares (the "Option Shares") of Common Stock at an exercise price of
$____ per share (the "Exercise Price"), and the Optionee accepts the grant of
the Option, subject to adjustment as provided in Section 4 herein.
2. Exercise of Option. The Option may be exercised at any time, or from
time to time, commencing from the date hereof and terminating at 5:00 PM New
York
time, on _____________ (the "Option Term"). The Option may be exercised, as
provided in this Section 2, by notice and payment to the Company as provided in
Section 6 hereof. In the event the Option is exercised for less than all the
Option Shares then covered by the Option, upon cancellation of this Agreement
the Company shall issue a new Option Agreement to the Optionee for the number of
remaining unexercised Option Shares.
3. Non-Transferability. The Option shall not be transferable in whole or
in part by the Optionee, except (i) by will or the laws of descent or
distribution, or (ii) to a member of the immediate family (spouse, child or
parent) of the Optionee, and such transferee agrees to be bound by the
provisions of this Section 3. Any transfer or attempted transfer of all or part
of the Option in violation of this Agreement shall be null and void, and, at the
discretion of the Company, the Option shall then be terminated.
4. Adjustments.
4.1 Change in Capitalization. In the event of a stock dividend, stock
split-up (whether forward or reverse), share combination, exchange of shares,
reclassification, capital reorganization, change of the outstanding Common
Stock, or other similar changes by the Company during the Option Term, the Board
of Directors of the Company shall make such adjustment of the number and class
of shares then covered by the Option, or of the Exercise Price, or both, to give
effect to such change.
4.2 Merger, Consolidation or Reorganization. If the Company shall be
the surviving entity in any reorganization, merger, consolidation or similar
transaction of the Company with one or more corporations or other entities, the
Option shall pertain to and apply to the securities to which the Optionee would
have been entitled immediately following such merger, consolidation or
reorganization with a corresponding proportionate adjustment, if necessary, of
the Exercise Price as to which the Option may be exercised so that the aggregate
Exercise Price as to the which the Option may be exercised shall be the same as
the aggregate Exercise Price as to which the Option may be exercised for
outstanding Option Shares immediately prior to such reorganization, merger or
consolidation.
4.3 Adjustments Due to Corporate Transaction. In the event of a merger,
consolidation or reorganization in which the Company is not the surviving
corporation, or sale of all or substantially all of the assets of the Company in
which outstanding shares of Common Stock are exchanged for securities, cash or
other property of any other corporation or business entity or in the event of a
liquidation of the Company (collectively, a "Corporate Transaction"), the Board
of Directors of the Company, or the board of directors of any corporation
assuming the obligations of the Company, may, in its discretion, take any one or
more of the following actions, as to outstanding Options: (i) provide that such
Options shall be assumed or equivalent Options shall be substituted, by the
acquiring or succeeding corporation (or an affiliate thereof), (ii) upon written
notice to the Optionee, provide that all unexercised Options will terminate
immediately prior to the consummation of such Corporate Transaction unless
exercised by the Optionee within a specified period following the date of such
notice, or (iii) in the event of a Corporate Transaction under the terms of
which holders of the Common Stock of the Company will receive upon consummation
thereof a cash payment for each share surrendered in the Corporate Transaction
(the "Transaction Price"), make or provide for a cash payment to the Optionee
equal to the difference between (A) the Transaction Price times the number of
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shares of Common Stock subject to such outstanding Options (to the extent then
exercisable at prices not in excess of the Transaction Price) and (B) the
aggregate Exercise Price of all such outstanding Options in exchange for the
termination of such Options.
4.4 Notice of Event. To the extent practicable, the Company shall give
the Optionee prior notice of any event that could result in an adjustment under
this Section 4, provided that the failure by the Company to give such notice
shall not subject the Company to any liability herein. After an event which
results in an adjustment in the Option, the Company shall give written notice to
the Optionee specifying the adjusted number or type of Option Shares or other
security and/or the Exercise Price, together with a calculation of the
adjustment. The determination of the adjustment by the Company shall be final
and binding on the Optionee.
5. Reservation of Shares. The Company shall at all times during the Option
Term reserve and keep available such number of shares of Common Stock or such
other class of stock then subject to the Option as shall be sufficient to
satisfy the requirements of this Agreement.
6. Methods of Exercise of Option.
6.1 The Exercise Notice. Subject to the terms and conditions of this
Agreement, the Option shall be exercisable by notice (the "Exercise Notice") and
payment to the Company. Each Exercise Notice shall:
(i) state the election to exercise the Option and the number of Option
Shares (such number being the "Purchased Shares") in respect of which it is
being exercised;
(ii) if the Purchased Shares are not then registered under the
Securities Act of 1933, as amended (the "Securities Act"), contain a
representation and agreement as to investment intent with respect to the
Purchased Shares, and an acknowledgement as to restrictions on resale or
transfer of such Shares by reason of the Securities Act; and
(iii) be signed by the person or persons entitled to exercise the
Option and, if the Option is being exercised by any person or persons other than
the Optionee, be accompanied by proof, satisfactory to counsel for the Company,
of the right of such person or persons to exercise the Option.
6.2 Payment. Accompanying the Exercise Notice shall be a certified
check or wire transfer payable to the order of the Company in the full amount of
the purchase price for the Purchased Shares.
6.3 Compliance. The Company, however, shall not be required to issue or
deliver the stock certificate pursuant to this Section 6 until it has complied
with all requirements of the Securities Act, the Securities Exchange Act of
1934, as amended, any securities exchange or automated quotation system on which
the Company's Common Stock may then be listed, and all applicable state laws in
connection with the issuance of the Option Shares or their listing on said
securities exchange or system, including receiving representations by the
Optionee as reasonably required to ensure compliance with the foregoing laws.
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6.4 Stock Certificate. Promptly upon receipt of the documents to be
provided for in Section 6.1 hereof in proper form, the Company shall deliver to
the person or person exercising the Option certificates for the Purchased
Shares. Each certificate shall bear the following legend, unless the Option
Shares are then included in an effective registration statement filed under the
Securities Act:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE
SECURITIES LAW AND MAY NOT BE SOLD OR OTHERWISE DISTRIBUTED
WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR
AN OPINION OF COUNSEL IN A FORM REASONABLY SATISFACTORY TO THE
ISSUER THAT SUCH REGISTRATION IS NOT REQUIRED UNDER SUCH ACT
AND LAWS"
7. Representations. The Holder represents that (i) he/she beneficially
owned his Founders Options free and clear of all liens and encumbrances, (ii)
he/she never exercised all or any part of his/her Founders Options and (iii)
upon execution of this Agreement he/she shall return the original Certificate
for his/her Founders Options or the original Intrac Stock Opton Agreement,
marked "Cancelled" or execute and deliver to the Company an Affidavit of Loss as
to such Certificate or Agreement in form satisfactory to the Company.
8. Rights of Holder. The Optionee shall not have any rights to voting,
dividends or any other rights of a stockholder with respect to any Option Shares
until the certificates for such Option Shares shall have been issued to him/her
as evidenced by the appropriate entry on the stock record books of the Company
upon purchase of such Option Shares upon exercise of the Option. [if the
Optionee is a Javelin or IDDS employee, add--Further, nothing in this Agreement
shall confer upon the Optionee any right to be continued in the employ of the
Company or any of its subsidiaries, or to interfere with the right of the
Company to terminate such employment.]
9. Notices. Any notice relating to this Agreement shall be in writing and
delivered in person, by certified mail, hand, express courier or fax as follows
to the address set forth below or such address as either party hereto may
hereafter duly give to the other party:
If to the Company:
Javelin Pharmaceuticals, Inc.
000 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: President
Fax: (000) 000-0000
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If to the Optionee:
________________________
________________________
________________________
Fax: (___)__________
10. Miscellaneous.
10.1 Benefits of Agreement. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective successors,
assigns, heirs and administrators.
10.2 Governing Law. This Agreement shall be construed by and governed
in accordance with the laws of the State of Delaware, without giving effect to
principles of conflicts of law.
10.3 Severability. In the event that any one or more provisions of this
Agreement shall be deemed to be illegal, invalid or unenforceable, such
illegality, invalidity or unenforceability shall not affect the legality,
validity and enforceability of the remaining legal, valid and enforceable
provisions hereof, which shall be construed as if such illegal, invalid or
unenforceable provision or provisions had not been inserted.
10.4 Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto as to the subject matter herein, and cannot be
amended, modified or terminated except by a writing executed by the parties
hereto. This Agreement supersedes all prior agreements of the Optionee with IDDS
and/or Intrac, including the Founders Option, as to the subject matter hereof.
10.5 Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original and all of which shall constitute a single
instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
date first set forth above.
JAVELIN PHARMACEUTICALS, INC.
By:__________________________
[name and title]
_____________________________
Name:________________
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