Exhibit 10.2

 

STOCK OPTION AGREEMENT

 

Under the RenovaCare, Inc.

 

2013 Long Term Incentive Plan

 

THIS STOCK OPTION AGREEMENT dated as of the 15th day of November, 2019, between
RenovaCare, Inc., a Nevada Corporation (the “Company”), and Alan L. Rubino (the
“Optionee”).

 

The Company and Optionee are party to that certain Employment Agreement, dated
on or about the date hereof (the “Employment Agreement”), pursuant to which the
Company has employed Optionee subject to the terms and condition thereof;

 

In connection with the Optionee’s employment with the Company, the Company
desires to grant to Optionee certain stock options, on the terms and conditions
hereinafter set forth.

 

In consideration of the mutual promises and covenants made herein and the mutual
benefits to be derived here from, the parties hereto agree as follows:

 

1. Grant of Stock Option.

 

Subject to the provisions of this Agreement and to the provisions of the
RenovCare, Inc. 2013 Long Term Incentive Plan (the “Plan”), the Company hereby
grants to the Optionee as of November 15, 2019 (the “Grant Date”) the right and
option (the “Stock Option”) to purchase two million (2,000,000) shares of common
stock of the Company, par value $0.0001 per share (“Common Stock”), which shares
shall become vested and exercisable according to the schedule and at the
exercise price set forth in Section 2 hereof. The Stock Option is intended to
qualify as an Incentive Stock Option, within the meaning of Section 422 of the
Internal Revenue Code, as amended (the “Code”). Unless earlier terminated
pursuant to the terms of this Agreement, the Stock Option shall expire on the
sixth anniversary of the date hereof unless earlier terminated pursuant to the
terms of this Agreement. Unless otherwise specified, capitalized terms not
defined herein shall have the meaning set forth in the Plan.

 

2. Vesting and Exercisability of the Stock Option.

 

(a) Vesting. Subject to remaining employed by the Company through the following
dates, the Stock Option shall become vested and exercisable as follows:

 

 

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Vesting Date Number of Shares Vesting Strike Price November 15, 2020 667,800
$1.98 November 15, 2021 667,800 $2.48 November 15, 2022 664,400 $3.23

 

Upon the Optionee’s termination of employment for any reason, the portion of the
Stock Option that is not vested as of such date, subject to and in accordance
with the provisions of this Section 2, shall cease vesting and terminate
immediately.

 

(b) Acceleration upon Change in Control. In the event that, within twelve (12)
months of a Change in Control, the Optionee’s employment with the Company is (A)
terminated without Cause (as defined in the Employment Agreement) by the
Company, , or (B) is terminated by the Optionee for Good Reason (as defined in
the Employment Agreement), any unvested portions of this Stock Option shall
immediately vest and remain exercisable for the remainder of the originally
scheduled term. For the purposes of this Agreement, a “Change in Control” means:
(a) the acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”)), other than any individual, entity or group which, as of
the date of this Agreement, beneficially owns more than ten percent (10%) of the
then outstanding shares of common stock of the Company (the “Outstanding Company
Common Stock”), of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 50% or more of the then Outstanding
Company Common Stock; provided, however, that any acquisition by the Company or
its subsidiaries, or any employee benefit plan (or related trust) of the Company
or its subsidiaries of 50% or more of Outstanding Company Common Stock shall not
constitute a Change in Control; and provided, further, that any acquisition by
an entity with respect to which, following such acquisition, more than 50% of
the then outstanding equity interests of such entity, is then beneficially
owned, directly or indirectly, by all or substantially all of the individuals
and entities who were the beneficial owners of the Outstanding Company Common
Stock immediately prior to such acquisition of the Outstanding Company Common
Stock, shall not constitute a Change in Control; or (b) the consummation of (i)
a reorganization, merger or consolidation (any of the foregoing, a “Merger”), in
each case, with respect to which all or substantially all of the individuals and
entities who were the beneficial owners of the Outstanding Company Common Stock
immediately prior to such Merger do not, following such Merger, beneficially
own, directly or indirectly, more than 50% of the then outstanding shares of
common stock of the corporation resulting from Merger, or (ii) the sale or other
disposition of all or substantially all of the assets of the Company, excluding
(a) a sale or other disposition of assets to a subsidiary of the Company; and
(b) a sale or other disposition of assets to any individual, entity or group
which, as of the date of this Agreement, beneficially owns more than ten percent
(10%) of the then Outstanding Company Common Stock.

 

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3. Method of Exercise of the Stock Option.

 

(a) The portion of the Stock Option as to which the Optionee is vested shall be
exercisable by delivery to the Company of a written or electronic notice stating
the number of whole shares to be purchased pursuant to this Agreement and
accompanied by payment of the full purchase price of the shares of Common Stock
to be purchased. Fractional share interests shall be disregarded except that
they may be accumulated.

 

(b) The exercise price of the Stock Option shall be paid: (i) in cash or by
certified check or bank draft payable to the order of the Company; (ii) by
delivering, along with a properly executed exercise notice to the Company, a
copy of irrevocable instructions to a broker to deliver promptly to the Company
the aggregate exercise price and, if requested by the Optionee, the amount of
any applicable federal, state, local or foreign withholding taxes required to be
withheld by the Company, provided, however, that such exercise may be
implemented solely under a program or arrangement established and approved by
the Company with a brokerage firm selected by the Company; or (iii) by any other
procedure approved by the Board or its Compensation Committee, if any, or by a
combination of the foregoing.

 

4. Termination of Employment Other Than Due to Death or Disability.

 

(a) Except as provided in Section 2(b) above with regard to a Change of Control,
Section 4(b) below with regard to the Optionee’s termination of employment for
Cause or following an event that would be grounds for a termination of
employment for Cause, and Section 5 below with regard to the Optionee’s
termination of employment due to death or Disability, in the event of the
Optionee’s termination of employment, the portion of the Stock Option, if any,
which is exercisable at the time of such termination may be exercised prior to
the first to occur of (a) the expiration of the ninety day (90) period which
commences on the date of termination or (b) the expiration date of the Stock
Option.

 

(b) In the event of the Optionee’s termination of employment for Cause (as
defined in the Employment Agreement), the Optionee’s entire Stock Option
(whether or not vested) shall be forfeited and canceled in its entirety upon
such termination of employment.

 

(c) Nothing in this Agreement or the Plan shall confer upon the Optionee any
right to continue in the employ of the Company or any of its subsidiaries or
affiliates or interfere in any way with the right of the Company or any such
subsidiaries or affiliates to terminate the Optionee’s employment at any time.

 

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5. Death or Disability of Optionee. In the event of the Optionee’s termination
of employment due to death (or, in the event of the Optionee’s death following
termination of employment while the Stock Option remains exercisable) the
portion of the Stock Option, if any, which is exercisable at the time of death
may be exercised by the Optionee’s estate or by a person who acquired the right
to exercise such Stock Option by bequest or inheritance or otherwise by reason
of the death of the Optionee at any time prior to the first to occur of (a)
twelve (12) months after the date of death or (b) the expiration date of the
Stock Option. In the event of the Optionee’s termination of employment due to
Disability (as defined in the Employment Agreement), the portion of the Stock
Option, if any, which is exercisable at the time of such termination of
employment for Disability may be exercised by the Optionee or the Optionee’s
guardian or legal representative at any time prior to the first to occur of (a)
twelve (12) months after such termination of employment or (b) the expiration
date of the Stock Option.

 

6. Non-transferability of the Stock Option. The Stock Option is non-transferable
by the Optionee other than by will or the laws of descent and distribution or
pursuant to a qualified domestic relations order, and the Stock Option may be
exercised, during the lifetime of the Optionee, only by the Optionee or by the
Optionee’s guardian or legal representative or any transferee described above.

 

7. Tax Matters.

 

(a) Section 422 Requirement. The Shares granted hereby are intended to qualify
as “incentive stock options” under Section 422 of the Code. Notwithstanding the
foregoing, the Shares will not qualify as “incentive stock options,” if, among
other events, (a) the Optionee disposes of the Shares acquired upon exercise of
this option within two years from the Grant Date or one year after such Shares
were acquired pursuant to exercise of this option; (b) except in the event of
the Optionee’s death or disability (as described in Section 5 above), the
Optionee is not employed by the Company, a parent or a subsidiary at all times
during the period beginning on Grant Date and ending on the day that is three
(3) months before the date of exercise of any Shares; or (c) to the extent the
aggregate fair market value of the Shares subject to “incentive stock options”
held by the Optionee which become exercisable for the first time in any calendar
year (under all plans of the Company, a parent or a subsidiary) exceeds
$100,000. For purposes of clause this paragraph, the “fair market value” of the
Shares shall be determined as of the Grant Date in accordance with the terms of
the Plan.

 

(b) Disqualifying Disposition. To the extent that any Shares do not qualify as
an “incentive stock option,” it shall not affect the validity of such Shares and
shall constitute a separate non-qualified stock option. In the event that the
Optionee disposes of the Shares acquired upon exercise of this option within two
years from the Grant Date or one year after such Shares were acquired pursuant
to exercise of this option, the Optionee must deliver to the Company, within
seven (7) days following such disposition, a written notice specifying the date
on which such shares were disposed of, the number of shares so disposed, and, if
such disposition was by a sale or exchange, the amount of consideration
received.

 

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(c) Withholding. No later than the date of exercise of the Stock Option granted
hereunder, the Optionee shall pay to the Company or make arrangements
satisfactory to the Board or its Compensation Committee, if any, regarding
payment of any federal, state or local taxes of any kind required by law to be
withheld upon the exercise of such Stock Option and the Company shall, to the
extent permitted or required by law, have the right to deduct from any payment
of any kind otherwise due to the Optionee, federal, state and local taxes of any
kind required by law to be withheld upon the exercise of such Stock Option.

 

The Optionee should consult with a tax advisor before exercising the Stock
Option or disposing of the Shares to obtain advice as to the consequences of
such exercise or disposition.

 

8. Rights as a Stockholder. An Optionee or a transferee of the Stock Option
shall have no rights as a stockholder with respect to any shares covered by such
Stock Option until the date when his or her purchase is entered upon the records
of the duly authorized transfer agent of the Company. No adjustment shall be
made for dividends (ordinary or extraordinary, whether in cash, securities or
other property) or distribution of other rights for which the record date is
prior to the date a stock certificate is issued, except as provided in the Plan.

 

9. Adjustment in the Event of Change in Stock. In accordance with Article 12 of
the Plan, in the event of any change in Corporate capitalization (including, but
not limited to, a change in the number of shares of Common Stock outstanding),
and the number and kind of shares subject to the Stock Option and/or the
exercise price per share will be adjusted. The determination of the Board or a
duly appointed Compensation Committee thereof regarding any adjustment will be
final and conclusive.

 

10. No Guarantee of Continued Service. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE
VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY
CONTINUING THE EMPLOYMENT OR BUSINESS RELATIONSHIP AT THE WILL OF THE COMPANY
(NOT THROUGH THE ACT OF BEING ENGAGED, BEING GRANTED THIS OPTION OR ACQUIRING
SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT,
THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH
HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED EMPLOYMENT
FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE IN
ANY WAY WITH OPTIONEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE THE
RELATIONSHIP AT ANY TIME, WITH OR WITHOUT CAUSE.

 

11. Other Restrictions. The exercise of the Stock Option shall be subject to the
requirement that, if at any time the Board or its Compensation Committee, if
any, shall determine that (i) the listing, registration or qualification of the
shares of Common Stock subject or related thereto upon any securities exchange
or under any state or federal law, or (ii) the consent or approval of any
government regulatory body or (iii) an agreement by the Optionee with respect to
the disposition of shares of Common Stock 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 listing, registration, qualification, consent, or approval
or agreement shall have been effected or obtained free of any conditions not
acceptable to the Board or its Compensation Committee, if any.

 

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The Company may, but will in no event be obligated to, register any securities
issuable upon the exercise of all or any portion of the Stock Option pursuant to
the Securities Act of 1933 (as now in effect or as hereafter amended) or to take
any other affirmative action in order to cause the exercise of the Stock Option
or the issuance of shares pursuant thereto to comply with any law or regulation
of any governmental authority. The certificates representing shares issued to
Optionee hereunder shall bear such legends as Company determines appropriate
referring to restrictions on the transfer of such shares imposed by this
Agreement and such other legends as are required or appropriate under applicable
law.

 

12. Notices. All notices and other communications under this Agreement shall be
in writing and shall be given by hand delivery to the other party or by
facsimile, overnight courier, or registered or certified mail, return receipt
requested, postage prepaid, addressed as follows:

 

If to the Company:

 

RenovaCare, Inc.

9375 East Shea Blvd.,

Suite 107-A

Scottsdale, AZ 85260

Attention: Harmel S. Rayat

Facsimile: 604-336-8609

Email Address: hsr@renovacareinc.com

 

If to the Executive, to the following address:

 

Alan L. Rubino

210 Old Chester Road

Essex Fells, NJ 07021

Email Address: alanrubino@comcast.net

 

or to such other address or facsimile number as any party shall have furnished
to the other in writing in accordance with this Section 12. Notice and
communications shall be effective when actually received by the addressee.

 

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13. Effect of Agreement. Except as otherwise provided hereunder, this Agreement
shall be binding upon and shall inure to the benefit of any successor or
successors of the Company, and to any transferee or successor of the Optionee
pursuant to Section 6.

 

14. Severability. The invalidity or enforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement. If the final judgment of a court of competent jurisdiction
declares that any provision of this Agreement is invalid or unenforceable, the
parties hereto agree that the court making the determination of invalidity or
unenforceability shall have the power, and is hereby directed, to reduce the
scope, duration or area of the provision, to delete specific words or phrases
and to replace any invalid or unenforceable provision with a provision that is
valid and enforceable and that comes closest to expressing the intention of the
invalid or unenforceable provision and this Agreement shall be enforceable as so
modified.

 

15. Conflicts and Interpretation. This Agreement is subject to all the terms,
conditions and provisions of the Plan. In the event of any conflict between this
Agreement and the Plan, the Plan shall control. In the event of any ambiguity in
this Agreement, any term which is not defined in this Agreement, or any matters
as to which this Agreement is silent, the Plan shall govern including, without
limitation, the provisions thereof pursuant to which the Board or its
Compensation Committee, if any has the power, among others, to (i) interpret the
Plan, (ii) prescribe, amend and rescind rules and regulations relating to the
Plan and (iii) make all other determinations deemed necessary or advisable for
the administration of the Plan.

 

16. Headings. The headings of Sections herein are included solely for
convenience of reference and shall not affect the meaning or interpretation of
any of the provisions of this Agreement.

 

17. Amendment. This Agreement may not be modified, amended or waived except by
an instrument in writing signed by both parties hereto. The waiver by either
party of compliance with any provision of this Agreement shall not operate or be
construed as a waiver of any other provision of this Agreement, or of any
subsequent breach by such party of a provision of this Agreement.

 

18. Term. The term of this Agreement is six years from the Grant Date, unless
terminated prior to such date in accordance with the provisions herein.

 

19. Counterparts. This Agreement may be executed in any number of counterparts,
each of which when so executed and delivered shall be deemed an original, and
all of which together shall constitute one and the same agreement. Execution of
a facsimile or scanned copy will have the same force and effect as execution of
an original, and a facsimile or scanned signature will be deemed an original and
valid signature.

 

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20. Laws Applicable to Construction. The interpretation, performance and
enforcement of this Agreement shall be governed by the laws of the State of
Nevada without reference to principles of conflict of laws, as applied to
contracts executed in and performed wholly within the State of Nevada.

 

 

[SIGNATURE PAGE FOLLOWS]

 

 

 

 

 

 

 

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IN WITNESS WHEREOF, as of the date first above written, the Company has caused
this Agreement to be executed on its behalf by a duly authorized officer and the
Optionee has hereunto set the Optionee’s hand.

 

 

RENOVACARE, INC.

 

BY: /s/ Jatinder S. Bhogal

 

Name: Jatinder S. Bhogal

 

Title: Chief Operating Officer

 

 

OPTIONEE

 

/s/ Alan L. Rubino

 

Name: Alan L. Rubino

 

 

 

 

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