Exhibit 10.5

Nonqualified Stock Option Award

General Terms and Conditions

(Non-Employee Directors)

OraSure Technologies, Inc. (the “Company”) maintains the Stock Award Plan (the
“Plan”). These Non-Qualified Stock Option Award General Terms and Conditions
(the “Award Terms”) govern the Award of an Option to Participant as a
Non-Employee Director pursuant to the Plan. Capitalized terms not otherwise
defined shall have the meanings set forth in Section 10 of these Award Terms.

 

1. Option Type and Term.

 

  1.1 Type of Option. The Option is not intended to be an incentive stock option
as described in Internal Revenue Code Section 422.

 

  1.2 Term. The Option term will expire on the expiration date shown on the
cover sheet unless earlier terminated pursuant to this Agreement.

 

  1.3 Vesting. Except as otherwise provided in this Agreement, the Option will
be vested as to, and accordingly may be exercised from time to time during the
term to purchase, Shares up to the number shown on the cover page as vested as
of the date of exercise.

 

2. Service As Director.

 

  2.1 Expiration After Termination of Service. If the recipient of the Option
(“Participant”) ceases to be a member of the Board of Directors of the Company
(the “Board”) for any reason, the right to exercise the Option will expire upon
the earlier of (i) the end of the original term as specified in Section 1.2
above, and (ii) the end of the following periods as applicable:

 

After Termination

On Account Of

   Period

Death

   1 year

Retirement

   5 years

Disability

   1 year

Any other reason

   1 year

 

  2.2 Effect of Termination on Vesting. Subject to Section 3, the Option will
continue vesting in accordance with Section 1.3 and will cease vesting upon
termination of Participant’s service as a member of the Board. The Shares as to
which the Option is exercisable will be those as to which the Option is vested
at the time of exercise.

 

  2.3 Adjustments. The Shares, the exercise price for the Shares and other terms
of the Option shall be subject to adjustment pursuant to Section 14.2 of the
Plan.

 

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  2.4 No Employment Contract. Neither the Plan nor the Option constitutes a
contract of employment of Participant by the Company or its affiliates.

 

3. Acceleration of Exercisability. The Option will become immediately and fully
vested and exercisable as to all Shares covered by the Option, (a) if a Change
in Control Date occurs while Participant serves on the Board or (b) upon
Participant’s death or Disability.

 

4. Method of Exercise.

 

  4.1 Exercise of Option. All or any portion of the Option may be exercised, to
the extent it has become exercisable pursuant to this Agreement, by delivery of
written notice to the Company in the attached form stating the number of Shares,
form of payment, and proposed date of closing.

 

  4.2 Other Documents. Participant must furnish the Company, before closing of
any exercise of the Option, such other documents or representations as the
Company may require to assure compliance with applicable laws and regulations.

 

  4.3 Price and Payment. The exercise price for the Shares purchased upon
exercise of the Option shall be as set forth on the cover sheet and must be paid
in full at or before closing by one or a combination of the following:

 

  (a) Payment in cash;

 

  (b) Delivery (in a form approved by the Committee) of an irrevocable direction
to a securities broker acceptable to the Committee:

 

  (i) To sell Shares subject to the Option and to deliver all or a part of the
sales proceeds to the Company in payment of all or a part of the exercise price
and withholding taxes due; or

 

  (ii) To pledge Shares subject to the Option to the broker as security for a
loan and to deliver all or a part of the loan proceeds to the Company in payment
of all or a part of the exercise price and withholding taxes due; or

 

  (c) Delivery of previously acquired Shares having a Fair Market Value at least
equal to the exercise price.

 

  4.4 Previously Acquired Shares. Delivery of previously acquired Shares
surrendered in full or partial payment of the exercise price of all or any
portion of the Option, will be subject to the following conditions:

 

  (a) The Shares tendered must be in good delivery form;

 

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  (b) The Fair Market Value of the Shares, together with the amount of cash, if
any, tendered must equal or exceed the exercise price of the Option;

 

  (c) Any Shares remaining after satisfying payment of the exercise price will
be reissued in the same manner as the Shares tendered; and

 

  (d) No fractional Shares will be issued and cash will not be paid to
Participant for any fractional Share value not used to satisfy payment of the
exercise price.

 

5. Transferability.

 

  5.1 Restriction. Except for Permitted Transfers, as defined in Section 5.2:

 

  (a) The Option is not transferable by Participant other than by testamentary
will or the laws of descent and distribution and, during Participant’s lifetime,
may be exercised only by Participant or Participant’s guardian or legal
representative;

 

  (b) No assignment or transfer of the Option, whether voluntary, involuntary,
or by operation of law or otherwise, except by testamentary will or the laws of
descent and distribution, will vest in the assignee or transferee any interest
or right; and

 

  (c) Immediately upon any attempt to assign or transfer the Option, the Option
will terminate and be of no force or effect.

 

  5.2 Permitted Transfers. Participant may transfer all or any portion of the
Option, without payment of consideration, to Participant’s family members,
trusts for such family members, or a partnership or limited liability company in
which Participant and members of Participant’s family own more than 50% of the
voting interests.

 

  5.3 Exercise in the Event of Death or Disability. Whenever the word
“Participant” is used in any provision of this Agreement under circumstances
when the provision should logically be construed to apply to Participant’s
guardian, legal representative, executor, administrator, or the person or
persons to whom the Option may be transferred by testamentary will or by the
laws of descent and distribution, the word “Participant” will be deemed to
include such person or persons.

 

6. Securities Laws. The Company will not be required to issue any Shares upon
exercise of the Option, or any portion thereof, until the Company has taken any
action required to comply with the provisions of the Securities Act of 1933 or
any other then applicable federal or state securities laws.

 

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7. Tax Reimbursement. In the event any withholding or similar tax liability is
imposed on the Company in connection with or with respect to the exercise of the
Option or the disposition by Participant of the Shares acquired upon exercise of
the Option, Participant will pay to the Company an amount sufficient to satisfy
such tax liability.

 

8. Conditions Precedent. The Company will use its best efforts to obtain any
required approvals of the Plan and the Option by any state or federal agency or
authority that the Company determines has jurisdiction. If the Company
determines that any required approval cannot be obtained, all Awards to
Participant will terminate on notice to Participant to that effect.

 

9. Successorship. Subject to the restrictions on transferability of the Option
set forth in this Agreement and in the Plan, the Agreement will be binding upon
and benefit the parties, their successors, and assigns.

 

10. Defined Terms. When used in this Agreement, the following terms have the
meanings specified below:

 

  10.1 “Agreement” means the agreement evidencing an Option governed by these
Award Terms.

 

  10.2 “Change in Control” shall have the meaning set forth in the Plan.

 

  10.3 “Change in Control Date” means the first date following the Grant Date on
which a Change in Control has occurred.

 

  10.5 “Committee” means the Compensation Committee of the Board or any
successor thereto.

 

  10.6 “Disability” shall have the meaning set forth in the Plan.

 

  10.7 “Grant Date” means the date of this Agreement, which is the date the
Option is granted to Participant.

 

  10.8 “Option” means the Nonqualified Stock Option granted to Participant
evidenced by this Agreement.

 

  10.9 Capitalized terms not otherwise defined in this Agreement have the
meanings given them in the Plan.

 

11. Option Subject to Plan. The Option is issued under the Plan and shall be
governed by its terms. Except as specifically set forth herein, in the event of
any inconsistency between the Plan and this Agreement, the Plan’s terms shall
control.

 

12. Notices. Any notices regarding the Option must be in writing and will be
effective when actually delivered personally or, if mailed, when deposited as
certified mail directed to the address maintained in the Company’s records or to
such other address as a party may certify by notice to the other party.

 

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Attachment: Exercise Form

 

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ELECTION TO EXERCISE NONQUALIFIED STOCK OPTION

 

To:    OraSure Technologies, Inc.    220 East First Street    Bethlehem, PA
18015

The undersigned hereby exercises the NonQualified Stock Option________________
evidenced

                                                                 
                                                 (option number)

by the NonQualified Stock Option Award Agreement dated_____________________ (the
“NonQualified

                                                                
                                 (date options were granted)

Agreement”), for_____________________ shares (the “Shares”) of common stock of
OraSure

                             (# of shares you wish to purchase)

Technologies, Inc. (the “Company”) at the price of $___________ per share and
agrees to tender payment

                                                                
                         (option price)

therefor in the amount of $_______________ (the “Exercise Price”) and required
withholding taxes in

                                         (# of shares purchased X option price)

accordance with the terms of the NonQualified Stock Option Award Agreement for
closing on

                    . (approximately 10 days after exercise)

Mark the appropriate responses below:

 

1.      

   Payment

¨       

   Payment in the amount of the Exercise Price and required withholding taxes is
enclosed.

¨       

   Payment in the amount of the Exercise Price and required withholding taxes
will be made to the Company within ten business days by _____________________
(“Broker”), to which I have given irrevocable instructions to sell enough of the
Shares for such purpose and to deliver proceeds in the amount of the Exercise
Price and withholding taxes to the Company. If the Broker does not make such
payment within such time, I agree to pay the Exercise Price and withholding
taxes to the Company within an additional five business days.

¨       

   Payment shall be made as described on the page attached hereto.

2.      

   Delivery of Shares.

¨       

   The shares have been sold. Please deliver the stock certificate to, and made
out in the name of the following:                   (e.g., Broker, Address,
Account Number)

¨       

   The Shares have not been sold. Please deliver the stock certificate to, and
made out in the name of:                   (e.g., your name)

 

DATED:_____________________________             

(Printed Name)

              

(Signature of Participant)

 

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EXERCISE OF NONQUALIFIED STOCK OPTIONS

OraSure Technologies, Inc.

220 East First Street

Bethlehem, PA 18015

For Federal Income Tax purposes, ORASURE TECHNOLOGIES, INC. is required to
include on each Participant’s year-end tax Form W-2 or 1099-MISC and on the
Company’s tax return, an amount equal to the difference between the fair market
value of stock purchased upon exercise of a NonQualified Stock Option on the
exercise date and the option exercise price (the “Option Spread”).

If you sold any of these option shares on the same day that you exercised them,
please provide the following information and return a copy of this form to the
Accounting department. This information will assist in the determination of the
fair market value of the shares at the time of exercise to be used to calculate
the Option Spread and proper withholding amounts.

 

Option Number         Date         Sale price per share      Option Number     
   Date         Sale price per share      Option Number         Date        
Sale price per share      Option Number         Date        
Sale price per share     

 

        Printed Name     Signature of Participant

 

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