Exhibit 10.3

 

 

NONQUALIFIED STOCK OPTION GRANT AGREEMENT

 

PROTAGENIC THERAPEUTICS, INC.

 

This Stock Option Grant Agreement (the “Grant Agreement”) is made and entered
into effective on the Date of Grant set forth in Exhibit A (the “Date of Grant”)
by and between Protagenic Therapeutics, Inc., a Delaware corporation (the
“Company”), and the individual named in Exhibit A hereto (the “Optionee”).

 

WHEREAS, the Company desires to provide the Optionee an incentive to participate
in the success and growth of the Company through the opportunity to earn a
proprietary interest in the Company; and

 

WHEREAS, to give effect to the foregoing intention, the Company desires to grant
the Optionee an option pursuant to the Protagenic Therapeutics, Inc. 2016 Equity
Compensation Plan (the “Plan”) to acquire the Company’s common stock, par value
$.0001 per share (the “Common Stock”);

 

NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth
and for good and valuable consideration, the parties hereto agree as follows:

 

1.          Grant. The Company hereby grants the Optionee a Nonqualified Stock
Option (the “Option”) to purchase up to the number of shares of Common Stock
(the “Shares”) set forth in Exhibit A hereto at the exercise price per Share
(the “Exercise Price”) set forth in Exhibit A, subject to the terms and
conditions set forth herein and the provisions of the Plan, the terms of which
are incorporated herein by reference. Capitalized terms used but not otherwise
defined in this Grant Agreement shall have the meanings as set forth in the
Plan.

 

2.          Vesting. Except as otherwise provided in this Grant Agreement, this
Option will vest and become exercisable, in whole or in part, as follows:
twenty-five percent (25%) of the total number of Shares Subject to the Option
set forth on Exhibit A shall vest on the first anniversary of the Date of Grant,
and (ii) the remaining seventy-five percent (75%) of the Shares underlying the
Option shall vest in equal monthly installments on the next thirty-six (36)
monthly anniversary dates thereafter (such that the final installment shall vest
on the fourth anniversary of the Date of Grant); provided, however, that no
portion of this Option will vest after the date on which the Optionee’s
employment or other Service with the Company and its Subsidiaries terminates.

 

 
 

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3.          Exercise Period Following Termination of Service. This Option shall
terminate and be canceled to the extent not exercised within ninety (90) days
after the Optionee’s employment or other Service with the Company and its
Subsidiaries terminates, except that if such termination is due to the death or
Disability of the Optionee, this Option shall terminate and be canceled twelve
(12) months from the date of termination of Service. Notwithstanding the
foregoing, in the event that the Optionee’s employment or other Service with the
Company and its Subsidiaries is terminated for Cause, then the Option shall
immediately terminate on the date of such termination of Service and shall not
be exercisable for any period following such date. In no event, however, shall
this Option be exercised later than the Expiration Date set forth in Exhibit A
and in no event shall this Option be exercised for more Shares than the Shares
which otherwise have become exercisable as of the date of termination.

  

4.          Method of Exercise. This Option is exercisable by delivery to the
Company of an exercise notice (the “Exercise Notice”) in a form satisfactory to
the Committee or by such other form or means as the Committee may permit or
require. Any Exercise Notice shall state or provide the number of Shares with
respect to which the Option is being exercised (the “Exercised Shares”), and
include such other representations and agreements as may be required by the
Company pursuant to the provisions of the Plan. The Exercise Notice shall be
accompanied by payment of the aggregate Exercise Price for the Exercised Shares
in (i) cash; (ii) check; or (iii) wire transfer. Upon exercise of the Option by
the Optionee and prior to the delivery of such Exercised Shares, the Company
shall have the right to require the Optionee to satisfy applicable Federal and
state tax income tax withholding requirements and the Optionee’s share of
applicable employment withholding taxes in a method satisfactory to the Company.
Notwithstanding the foregoing, no Exercised Shares shall be issued unless such
exercise and issuance complies with the requirements relating to the
administration of stock option plans and other applicable equity plans under
U.S. state corporate laws, U.S. federal and state securities laws, the Code, any
stock exchange or quotation system on which the Common Stock is listed or
quoted, and the applicable laws of any foreign country or jurisdiction where
stock grants or other applicable equity grants are made under the Plan; assuming
such compliance, for income tax purposes the Exercised Shares shall be
considered transferred to the Optionee on the date the Option is exercised with
respect to such Shares.

 

5.          Covenants Agreement. This Option shall be subject to forfeiture at
the election of the Company in the event that the Optionee breaches any
agreement between the Optionee and the Company with respect to noncompetition,
nonsolicitation, assignment of inventions and contributions and/or nondisclosure
obligations of the Optionee.

 

 

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6.          Taxes. By executing this Grant Agreement, Optionee acknowledges and
agrees that Optionee is solely responsible for the satisfaction of any
applicable taxes that may be imposed on Optionee that arise as a result of the
grant, vesting or exercise of the Option, including without limitation any taxes
arising under Section 409A of the Code (regarding deferred compensation) or
Section 4999 of the Code (regarding golden parachute excise taxes), and that
neither the Company nor the Committee shall have any obligation whatsoever to
pay such taxes or otherwise indemnify or hold Optionee harmless from any or all
of such taxes.

 

7.          Non-Transferability of Option. This Option may not be transferred in
any manner otherwise than by will or by the laws of descent or distribution and
may be exercised during the lifetime of the Optionee only by the Optionee. The
terms of the Plan and this Grant Agreement shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.

 

8.          Securities Matters. All Shares and Exercised Shares shall be subject
to the restrictions on sale, encumbrance and other disposition provided by
Federal or state law. The Company shall not be obligated to sell or issue any
Shares or Exercised Shares pursuant to this Grant Agreement unless, on the date
of sale and issuance thereof, such Shares are either registered under the
Securities Act of 1933, as amended (the “Securities Act”), and all applicable
state securities laws, or are exempt from registration thereunder. Regardless of
whether the offering and sale of Shares under the Plan have been registered
under the Securities Act, or have been registered or qualified under the
securities laws of any state, the Company at its discretion may impose
restrictions upon the sale, pledge or other transfer of such Shares (including
the placement of appropriate legends on stock certificates or the imposition of
stop-transfer instructions) if, in the judgment of the Company, such
restrictions are necessary in order to achieve compliance with the Securities
Act or the securities laws of any state or any other law.

 

9.          Investment Purpose. The Optionee represents and warrants that unless
the Shares are registered under the Securities Act, any and all Shares acquired
by the Optionee under this Grant Agreement will be acquired for investment for
the Optionee’s own account and not with a view to, for resale in connection
with, or with an intent of participating directly or indirectly in, any
distribution of such Shares within the meaning of the Securities Act. The
Optionee agrees not to sell, transfer or otherwise dispose of such Shares unless
they are either (1) registered under the Securties Act and all applicable state
securities laws, or (2) exempt from such registration in the opinion of Company
counsel.

 

10.         Lock-Up Agreement. The Optionee hereby agrees that in the event that
the Optionee exercises this Option during a period in which any directors or
officers of the Company have agreed with one or more underwriters not to sell
securities of the Company, then, upon request from the Company, as a condition
to such exercise, the Optionee shall enter into an agreement, in form and
substance satisfactory to the Company, pursuant to which the Optionee shall
agree to restrictions on transferability of the Shares comparable to the
restrictions agreed upon by such directors or officers of the Company.

 

 
 

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11.         Other Plans. No amounts of income received by the Optionee pursuant
to this Grant Agreement shall be considered compensation for purposes of any
pension or retirement plan, insurance plan or any other employee benefit plan of
the Company or its subsidiaries, unless otherwise expressly provided in such
plan.

 

12.         No Guarantee of Continued Service. The Optionee acknowledges and
agrees that the right to exercise the Option pursuant to the exercise schedule
hereof is earned only by continuing employment or Service with the Company
and/or its Subsidiaries (and not through the act of being hired, being granted
an option or purchasing shares hereunder). The Optionee further acknowledges and
agrees that (i) this Grant Agreement, the transactions contemplated hereunder
and the exercise schedule set forth herein do not constitute an express or
implied promise of continued employment or Service for the exercise period or
for any other period, and shall not interfere with the Optionee’s right or the
right of the Company or its Subsidiaries to terminate the employment or Service
relationship at any time, with or without cause, subject to the terms of any
written employment agreement that the Optionee may have entered into with the
Company or any of its Subsidiaries; and (ii) the Company would not have granted
this Option to the Optionee but for these acknowledgements and agreements.

  

13.         Entire Agreement; Governing Law. The Plan is incorporated herein by
reference. The Plan and this Grant Agreement constitute the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and the Optionee
with respect to the subject matter hereof, and may not be modified adversely to
the Optionee’s interest except by means of a writing signed by the Company and
the Optionee. In the event of any conflict between this Grant Agreement and the
Plan, the Plan shall be controlling, except as otherwise specifically provided
in the Plan. This Grant Agreement shall be construed under the laws of the State
of Delaware, without regard to conflict of laws principles.

 

14.         Opportunity for Review. Optionee and the Company agree that this
Option is granted under and governed by the terms and conditions of the Plan and
this Grant Agreement. The Optionee has reviewed the Plan and this Grant
Agreement in their entirety, has had an opportunity to obtain the advice of
counsel prior to executing this Grant Agreement and fully understands all
provisions of the Plan and this Grant Agreement. The Optionee hereby agrees to
accept as binding, conclusive and final all decisions or interpretations of the
Committee upon any questions relating to the Plan and this Grant Agreement. The
Optionee further agrees to notify the Company upon any change in the residence
address indicated herein.

 

 
 

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15.         Section 409A.  This Option is intended to be excepted from coverage
under Section 409A and shall be administered, interpreted and construed
accordingly. The Company may, in its sole discretion and without the Optionee’s
consent, modify or amend the terms of this Grant Agreement, impose conditions on
the timing and effectiveness of the exercise of the Option by Optionee, or take
any other action it deems necessary or advisable, to cause the Option to be
excepted from Section 409A (or to comply therewith to the extent the Company
determines it is not excepted).

 

[Signature Page Follows]

 

 
 

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IN WITNESS WHEREOF, the parties hereto have executed this Grant Agreement as of
the date set forth in Exhibit A.

 

 

CORBUS PHARMACEUTICALS HOLDINGS, INC.

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

OPTIONEE

 

 

 

Name:

 

 
 

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EXHIBIT A

 

NONQUALIFIED STOCK OPTION GRANT AGREEMENT

 

PROTAGENIC THERAPEUTICS, INC.

 

(a).         Optionee’s Name:
                                                    

 

(b).         Date of Grant:                                        

 

(c).         Number of Shares Subject to the Option:
                              

 

(d).         Exercise Price: $______ per Share

 

(e).         Expiration Date:                               

 

_______ (Initials)

Optionee

 

_______ (Initials)

Company Signatory