Exhibit 10.20
BIODEL INC.
2005 NON-EMPLOYEE DIRECTORS’ STOCK OPTION PLAN
STOCK OPTION AGREEMENT
     STOCK OPTION AGREEMENT dated as of ______, 200______ (“Agreement”) between
BIODEL INC. (the “Company”) and _________ (the “Optionee”). Capitalized terms
used but not defined herein shall have the meanings respectively assigned to
those terms in the 2005 Non-Employee Directors Stock Option Plan of the Company
(as amended and restated to date, the “Plan”).
RECITALS
     WHEREAS, the Optionee is a director of the Company and not an employee of
the Company; and
     WHEREAS, there has automatically been granted under the Plan to the
Optionee an option under the Plan to purchase shares of Common Stock, all upon
the terms and subject to the conditions set forth in the Plan and this
Agreement.
     NOW, THEREFORE, in consideration of the foregoing recitals, the mutual
covenants set forth in the Plan and in this Agreement and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company and the Optionee hereby agree as follows:
     1. Grant of Option; Certain Terms and Conditions. The Company hereby grants
to the Optionee as of the date of grant indicated below, an option (this
“Option”) to purchase all or any portion of the number of shares of Common Stock
indicated below (the “Option Shares”) at the exercise price per share indicated
below. Unless earlier terminated as provided herein or in the Plan, this Option
shall expire at 5:00 o’clock p.m., New York time, on expiration date indicated
below and shall be subject to all of the terms and conditions set forth in the
Plan and this Agreement.
Grantee:
Date of Grant:
Number of Shares Purchasable:
Exercise Price per Share:
Expiration Date:

 

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     2. Consideration. The purchase price of the Option Shares to be acquired
pursuant to this Option shall be paid, to the extent permitted by applicable
law, either (a) in cash at the time this Option is exercised or (b) at the
discretion of the Board (i) by delivery to the Company of other Common Stock at
the time this Option is exercised, (ii) by a “net exercise” of this Option (as
further described below), (iii) pursuant to any program developed by the
Company, under Regulation T as promulgated by the Federal Reserve Board that,
prior to the issuance of Common Stock, results in either the receipt of cash (or
check) by the Company or the receipt of irrevocable instructions to pay the
aggregate exercise price to the Company from the sales proceeds (a “Regulation T
Program”), or (v) in any other form of legal consideration that may be
acceptable to the Board. The purchase price of Common Stock acquired pursuant to
this Option that is paid by delivery to the Company of other Common Stock
acquired, directly or indirectly from the Company, shall be paid only by shares
of the Common Stock of the Company that have been held for more than six
(6) months (or such longer or shorter period of time required to avoid a charge
to earnings for financial accounting purposes). In the case of a “net exercise”
of this Option, the Company will not require a payment of the exercise price of
this Option from the Optionee but will reduce the number of shares of Common
Stock issued upon the exercise by the largest number of whole shares that has a
Fair Market Value that does not exceed the aggregate exercise price. With
respect to any remaining balance of the aggregate exercise price, the Company
shall accept a cash payment from the Optionee. Shares of Common Stock will no
longer be outstanding under this Option (and will therefore not thereafter be
exercisable) following the exercise of this Option to the extent of (i) shares
used to pay the exercise price of this Option under the “net exercise”, (ii)
shares actually delivered to the Optionee as a result of such exercise and
(iii) shares withheld for purposes of tax withholding.
     3. Termination of Option.
          (a) Termination of Continuous Service. In the event that the
Optionee’s Continuous Service terminates for any reason, the Optionee may
exercise this Option (to the extent that the Optionee was entitled to exercise
this Option as of the date of termination) but only within such period of time
ending on the earlier of (i) the date three (3) months following the termination
of the Optionee’s Continuous Service or (ii) the expiration of the term of this
Option as set forth in Section 1 of this Agreement. If, after such termination
of Continuous Service, the Optionee does not exercise this Option within the
time specified herein, this Option shall terminate.
          (b) Extension of Termination Date. If the exercise of this Option
following the termination of the Optionee’s Continuous Service would be
prohibited at any time solely because the issuance of Option Shares would
violate the registration requirements under the Securities Act, then this Option
shall terminate on the earlier of (i) the expiration of the term of this Option
set forth in Section 1 of this Agreement or (ii) the expiration of a period of
three (3) months after the termination of the Optionee’s Continuous Service
during which the exercise of this Option would not be in violation of such
registration requirements.
          (c) Dissolution or Liquidation. In the event of a dissolution or
liquidation of the Company, then this Option shall terminate immediately prior
to the completion of such dissolution or liquidation.

 

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     5. Capitalization Adjustments. In the event of a Capitalization Adjustment,
this Option will be appropriately adjusted in the class(es) and number of
securities and purchase price per Option Share in accordance with the terms of
the Plan. The foregoing adjustment and the manner of application of the
foregoing provisions shall be determined by the Board in its sole discretion and
to the extent permitted by Section 409A of the Code and the Treasury Regulations
thereunder, and its determination shall be final, binding and conclusive.
     6. Payment of Withholding Taxes.
          (a) At the time the Optionee exercises this Option, in whole or in
part, or at any time thereafter as requested by the Company, the Optionee hereby
authorizes withholding from payroll and any other amounts payable to the
Optionee, and otherwise agrees to make adequate provision for (including by
means of exercise under a Regulation T Program), any sums required to satisfy
the federal, state, local and foreign tax withholding obligations of the Company
or an Affiliate, if any, which arise in connection with the exercise of this
Option.
          (b) Upon the Optionee’s request and subject to approval by the
Company, in its sole discretion, and compliance with any applicable legal
conditions or restrictions, the Company may withhold from fully vested Option
Shares otherwise issuable to the Optionee upon the exercise of this Option a
number of Option Shares having a Fair Market Value, determined by the Company as
of the date of exercise, not in excess of the minimum amount of tax required to
be withheld by law (or such lower amount as may be necessary to avoid variable
award accounting). Notwithstanding the filing of such election, shares of Common
Stock shall be withheld solely from fully vested Option Shares determined as of
the date of exercise of this Option that are otherwise issuable to the Optionee
upon such exercise. Any adverse consequences to the Optionee arising in
connection with such share withholding procedure shall be the Optionee’s sole
responsibility.
          (c) The Optionee may not exercise this Option unless the tax
withholding obligations of the Company and/or any Affiliate are satisfied.
Accordingly, the Optionee may not be able to exercise this Option when desired
even though this Option is vested, and the Company shall have no obligation to
issue a certificate for such Option Shares until such tax withholding
obligations are satisfied.
     7. Securities Law Compliance; Restrictive Legends. The Company may require,
as a condition of exercising or acquiring Option Shares under this Option,
(i) to give written assurances satisfactory to the Company as to the Optionee’s
knowledge and experience in financial and business matters and/or to employ a
purchaser representative reasonably satisfactory to the Company who is
knowledgeable and experienced in financial and business matters and that the
Optionee is capable of evaluating, alone or together with the purchaser
representative, the merits and risks of exercising this Option, and (ii) to give
written assurances satisfactory to the Company stating that the Optionee is
acquiring Option Shares for the Optionee’s own account and not with any present
intention of selling or otherwise distributing the Common Stock. The foregoing
requirements, and any assurances given pursuant to such requirements, shall be
inoperative if (iii) the issuance of the Option Shares has been registered

 

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under a then currently effective registration statement under the Securities Act
or (iv) as to any particular requirement, a determination is made by counsel for
the Company that such requirement need not be met in the circumstances under the
then applicable securities laws. The Company may, upon advice of counsel to the
Company, place legends on stock certificates issued under the Plan as such
counsel deems necessary or appropriate in order to comply with applicable
securities laws, including, but not limited to, legends restricting the transfer
of the Option Shares.
     8. No Employment of Other Service Rights. Nothing in the Plan or in this
Agreement shall confer upon the Optionee any right to continue to serve the
Company as a Director or shall affect the right of the Company to terminate the
service of a Director pursuant to the Bylaws of the Company or any applicable
provisions of the corporate law of the state in which the Company is
incorporated.
     9. Plan Governs. The Company and the Optionee agree that they will both be
subject to and bound by all of the terms and conditions of the Plan, a copy of
which has been furnished to the Optionee, as the same may be amended, modified,
or supplemented at any time and from time to time. In the event of a conflict
between the terms of this Agreement and the terms of the Plan, the terms of the
Plan shall govern.
     10. No Rights as a Stockholder. The Optionee shall not be considered to be
the holder of, or to have any of the rights of a holder with respect to, any
shares of Common Stock subject to this Option unless and until the Optionee has
satisfied all requirements for exercise of this Option pursuant to its terms.
     11. Nontransferability. This option is transferable by will or by the laws
of descent and distribution. This option also may be transferable upon written
consent of the Company if, at the time of transfer, a Form S-8 registration
statement under the Securities Act is available for the exercise of the Option
and the subsequent resale of the Option Shares. In addition, the Optionee may,
by delivering written notice to the Company, in a form provided by or otherwise
satisfactory to the Company, designate a third party who, in the event of the
death of the Optionee, shall thereafter be entitled to exercise this Option.
     12. Notices. All notices and other communications required or permitted to
be given pursuant to this Agreement shall be in writing and shall be deemed
given if delivered personally or five days after mailing by certified or
registered mail, postage prepaid, return receipt requested, to the Company at
100 Saw Mill Road, Danbury, Connecticut 06810, Attention: Corporate Secretary,
or to the Optionee at the residence address of Grantee set forth in the records
of the Company, or at such other addresses as either the Company or the Optionee
may designate by written notice in the manner aforesaid.
     13. Governing Law. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of New York, without regard
to principles of conflicts of law (other than Section 5-1401 of the New York
General Obligations Law).

 

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     14. Severability. The invalidity, illegality or unenforceability of any
provision herein shall not affect the validity, legality or enforceability of
any other provision.
[Signature page follows]

 

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     IN WITNESS WHEREOF, the Company and the Optionee have executed this
Agreement as of the date first above written.

            BIODEL INC.
      By:           Print Name:   Solomon S. Steiner, Ph.D.        Print
Title:   CEO and Chairman              ____________________________, the
Optionee