Exhibit 10.2

INCENTIVE STOCK OPTION
non-transferable
GRANT TO
DENI M. ZODDA
(the “Participant”) on February 22, 2007
the right to purchase (“ISO”) from NovaDel Pharma Inc. (the “Company”)
68,027 shares of its common stock, par value $0.001 per share,
at the exercise price of $1.47 per share

pursuant to and subject to the provisions of the 2006 NovaDel Pharma Inc. Equity
Incentive Plan (the “Plan”) and to the terms and conditions set forth hereafter.
By accepting the ISO, the Participant, shall be deemed to have agreed to the
terms and conditions set forth in this Award Agreement and the Plan. This option
is intended to qualify as an “incentive stock option” within the meaning of
Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”).

IN WITNESS WHEREOF, NovaDel Pharma Inc. acting by and through its duly
authorized officer, has caused this Award Agreement to be executed as of the day
and year first above written.

 

 

 

 

 

NovaDel Pharma Inc.

 

 

 

 

 

By: 

/s/ MICHAEL E. SPICER

 

 

 

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Its: Chief Financial Officer

 

 

 

 

 

Accepted by the Participant:

 

 

 

 

 

/s/ DENI M. ZODDA

 

 

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Deni M. Zodda

 

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1.

Grant of Option. The committee (the “Committee”) appointed by the Board of
Directors of the Company to administer the 2006 NovaDel Pharma Inc. Equity
Incentive Plan (the “Plan”), hereby grants to the Participant named above, under
the Plan, an incentive stock option (the “ISO”) to purchase from the Company, on
the terms and conditions set forth in this Award Agreement, the number of shares
(“Shares”) indicated above of the Company’s $0.001 par value common stock
(“Common Stock”), at the exercise price per share set forth above (the “Exercise
Price”). Unless otherwise indicated, any capitalized terms used but not defined
herein shall have the meaning ascribed to such term in the Plan. By accepting
the ISO, the Participant is deemed to agree to comply with the terms of the
Plan, this Award Agreement and all applicable laws and regulations.

 

 

2.

Tax Matters. The ISO granted hereunder is intended to qualify as an “incentive
stock option” under Section 422 of the Code. If the aggregate Fair Market Value
of Shares with respect to which the ISO first become exercisable by the
Participant in any calendar year exceeds the limit determined in accordance with
the provisions of Section 422 of the Code (the “Limit”) taking into account
Shares subject to all ISOs granted by the Company which are held by the
Participant, the excess will be treated as nonstatutory stock options which
shall continue to be subject to all provisions in this Award Agreement and the
Plan. To determine whether the Limit is exceeded, the Fair Market Value of
Shares subject to an ISO shall be determined as of the Grant Dates of such ISOs.
In reducing the number of options treated as ISOs to meet the Limit, the most
recently granted options will be reduced first. If a reduction of simultaneously
granted options is necessary to meet the Limit, the Committee may designate
which Shares are to be treated as Shares acquired pursuant to an ISO.

 

 

3.

Vesting. The ISO shall become exercisable as provided below, which shall be
cumulative. To the extent that the ISO has become exercisable with respect to a
number of Shares as provided below, the ISO may thereafter be exercised by the
Participant, in whole or in part, at any time or from time to time prior to the
expiration of the ISO as provided herein and in accordance with the Plan,
including, without limitation, the filing of such written form of exercise
notice, if any, as may be required by the Committee and payment in full of the
Exercise Price multiplied by the number of Shares so exercised. Upon expiration
of the ISO, the ISO shall be cancelled and no longer exercisable. The following
table indicates each date upon which the Participant shall be entitled to
exercise the ISO with respect to the percentage of Shares vested indicated
beside that date provided that the Participant is continuously employed at all
times until the applicable vesting date:

 

 

 

 

Vesting Date

Number of Shares Vested

 

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•

signing of a Board approved third party agreement for U.S. or world wide rights
of sumatriptan

22,676

 

 

 

•

signing of a Board approved third party agreement for U.S. or world wide rights
of zolpidem

22,676

 

 

 

•

approval by the Board of any third party agreement whereby the Company obtains
the right to develop a product incorporating an active pharmaceutical ingredient
(“API”) that is the subject of a then valid United States Patent (or in-process
United States Patent Application) and already approved for sale by the United
States Food and Drug Administration with sales in the U.S. of at least $100
million

22,675

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There shall be no proportionate or partial vesting in the periods prior to each
vesting date and all vesting shall occur only on the appropriate vesting date.

 

 

4.

Option Term. The term of the ISO shall be ten (10) years after the Grant Date,
subject to earlier termination in the event of the Participant’s termination of
employment or service as set forth in Section 5.

 

 

5.

Termination.

 

          a. For Cause. If the Participant’s employment or service is terminated
for Cause any unexercised ISO shall terminate effective immediately.

 

 

 

          b. On Account of Death. If the Participant’s employment or service
terminates on account of death (or if the Participant dies within ninety (90)
days following termination of employment due to Disability), then any
unexercised ISO, to the extent exercisable on the date of death, may be
exercised, in whole or in part, within the first one hundred eighty (180) days
(but only during the Option Term) after the death of the Participant by (A) his
or her personal representative or by the person to whom the ISO is transferred
by will or the applicable laws of descent and distribution, or (B) the
Participant’s designated beneficiary and, to the extent that any such ISO was
not exercisable on the date of death, it will immediately terminate.

 

 

 

          c. On Account of Disability. If the Participant’s employment or
service terminates on account of Disability, then any unexercised ISO, to the
extent exercisable on the date of such termination of employment or service due
to Disability, may be exercised in whole or in part, within the first ninety
(90) days after such termination of employment or service due to Disability (but
only during the Option Term) by the Participant, or by his or her legal guardian
or representative, and to the extent that any such ISO was not exercisable on
the date of such termination of employment due to Disability, it will
immediately terminate.

 

 

 

          d. Other. If (i) the Participant’s employment is terminated prior to
the end of the term under any employment agreement between the Company and the
Participant other than as a result of the Participant’s death or Disability and
other than for Cause or due to a Change in Control, (ii) the Participant’s
employment is terminated by the Participant other than for Good Reason, (iii)
the Participant’s employment agreement is not renewed by the Participant at the
end of its initial term, or (iv) the Company provides notice to the Participant
that his employment agreement will not be renewed, any portion of the ISO that
has not vested shall expire as of the termination date or nonrenewal date, and
any unexercised portion of a vested ISO shall remain exercisable for a period of
three (3) months after the termination date, the date of nonrenewal or the
expiration of the ISO, whichever is earlier.

 

 

6.

Provisions of Plan Control. This Award Agreement is subject to all the terms,
conditions and provisions of the Plan, including, without limitation, the
amendment provisions thereof, and to such rules, regulations and interpretations
relating to the Plan as may be adopted by the Committee and as may be in effect
from time to time. The Plan is incorporated herein by reference. If and to the
extent that this Award Agreement conflicts or is inconsistent with the terms,
conditions and provisions of the Plan, the Plan shall control, and this Award
Agreement shall be deemed to be modified accordingly, provided that to the
extent the Plan provides the Committee with discretion to determine the terms of
the ISO the exercise of such discretion shall not be considered to be
inconsistent with the terms of the Plan. This Award Agreement contains the
entire understanding of the parties with respect to the subject matter hereof
and supersedes any prior agreements between the Company and the Participant with
respect to the subject matter hereof.

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7.

Notices. All notices or other communications required or permitted to be given
under this Award Agreement to the Company shall be in writing and shall be
deemed to have been duly given if delivered personally or mailed, postage
pre-paid, as follows: (i) if to the Company, at its principal business address
to the attention of the Secretary; and (ii) if to the Participant, at the last
address of the Participant known to the Company at the time the notice or other
communication is sent.

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