Exhibit 10.1

XETHANOL CORPORATION
STOCK OPTION AGREEMENT

THIS STOCK OPTION AGREEMENT (this “Agreement”) is entered into as of this 9th
day of October 2008 by and between Xethanol Corporation, a Delaware corporation
(the “Company”), and ______________________________ (the “Optionee”).
Capitalized terms not defined in this Agreement have the meanings given in the
Xethanol Corporation 2005 Incentive Compensation Plan, as amended effective
February 12, 2008 (the “Plan”).

Background

A. On the date specified above, the Compensation Committee (the “Committee”) of
the Board of Directors of the Company granted to the Optionee an option (the
“Option”) to purchase the number of shares of the Company’s common stock, par
value $0.001 per share (the “Stock”), as provided below.

B. In consideration of the granting of the Option, the Optionee intends to
remain in the employ of the Company or continue to provide services to the
Company.

C. The Company and the Optionee desire to enter into a written agreement with
respect to the Option in accordance with the Plan.

Agreement

As an employment incentive and to encourage stock ownership, and also in
consideration of the mutual covenants contained in this Agreement, the parties
to this Agreement agree as follows:

1. Incorporation of Plan. This Option is granted pursuant to the provisions of
the Plan and the terms and definitions of the Plan are incorporated into this
Agreement by reference. The Company has delivered a copy of the Plan to the
Optionee, who acknowledges receipt of the Plan.

2. Grant of Option. Subject to the terms, restrictions, limitations and
conditions stated in this Agreement, the Company hereby evidences its grant to
the Optionee, not in lieu of salary or other compensation, of the right and
option to purchase all or any part of the number of shares of the Company’s
Stock provided on Schedule A attached to this Agreement and incorporated into
this Agreement by reference. The Option shall vest and be exercisable in the
amounts and at the time specified on Schedule A. The Option shall expire and
shall not be exercisable on the date specified on Schedule A or on such earlier
date as determined pursuant to Sections 8, 9, or 10 below. Schedule A states
whether the Option is intended to be an Incentive Stock Option.

3. Purchase Price. The price per share to be paid by the Optionee for the shares
subject to this Option (the “Exercise Price”) shall be as specified on Schedule
A.

4. Exercise Terms. The Optionee must exercise the Option for at least the lesser
of 100 shares or the number of shares of purchasable Stock as to which the
Option remains unexercised. If this Option is not exercised with respect to all
or any part of the shares subject to this Option before it expires, the shares
with respect to which this Option was not exercised shall no longer be subject
to this Option.

5. Option Non-Transferable. No Option shall be transferable by an Optionee other
than by will or the laws of descent and distribution. During the lifetime of an
Optionee, Options shall be exercisable only by such Optionee (or by such
Optionee’s guardian or legal representative, should one be appointed).

 
 

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6. Notice of Exercise of Option. This Option may be exercised by the Optionee,
or by the Optionee’s administrators, executors or personal representatives, by a
written notice (in substantially the form of the Notice of Exercise attached to
this Agreement as Schedule B) signed by the Optionee, or by such administrators,
executors or personal representatives, and delivered or mailed to the Company as
specified in Section 15 below to the attention of the Chief Financial Officer or
such other officer as the Company may designate. Any such notice shall (a)
specify the number of shares of Stock that the Optionee or the Optionee’s
administrators, executors or personal representatives, as the case may be, then
elect to purchase under this Agreement, (b) contain such information as may be
reasonably required pursuant to Section 12 below, and (c) as authorized by the
Committee, be accompanied by (x) a certified or cashier’s check payable to the
Company in payment of the total Exercise Price applicable to the shares of Stock
being purchased, (y) shares of Stock owned by the Optionee and duly endorsed or
accompanied by stock transfer powers having a Fair Market Value equal to the
total Exercise Price applicable to the shares of Stock being purchased, or (z) a
certified or cashier’s check accompanied by the number of shares of Stock whose
Fair Market Value when added to the amount of the check equals the total
Exercise Price applicable to the shares of Stock being purchased as provided in
this Agreement. Upon receipt of any such notice and accompanying payment, and
subject to the terms of this Agreement, the Company agrees to issue to the
Optionee or the Optionee’s administrators, executors or personal
representatives, as the case may be, stock certificates for the number of shares
specified in such notice registered in the name of the person exercising this
Option; provided that in the discretion of the Committee, the Company may issue
the shares specified in such notice in uncertificated, book-entry form as
permitted by the Company’s bylaws.

7. Adjustment in Option. The number of shares subject to this Option, the
Exercise Price and other matters are subject to adjustment during the term of
this Option in accordance with Sections 9 and 10 of the Plan.

8. Termination of Continuous Service.

(a) Except as otherwise specified in Schedule A, in the event of the termination
of the Optionee’s Continuous Service, other than a termination that is either
(x) for Cause, (y) voluntary on the part of the Optionee and without written
consent of the Company, or (z) due to the Optionee’s death or Disability or
retirement, the Optionee may exercise this Option at any time within 90 days
after such termination to the extent of the number of shares that were
purchasable under this Agreement at the date of such termination. The Option
shall not thereafter be or become exercisable.

(b) Except as specified in Schedule A, in the event of a termination of the
Optionee’s Continuous Service that is either (x) for Cause or (y) voluntary on
the part of the Optionee and without the written consent of the Company, this
Option, to the extent not previously exercised, shall terminate immediately and
shall not thereafter be or become exercisable.

(c) Unless and to the extent otherwise provided in Schedule A, in the event of
the retirement of the Optionee at the normal retirement date as prescribed from
time to time by the Company or any subsidiary, the Optionee shall continue to
have the right to exercise this Option for shares which were purchasable at the
date of the Optionee’s retirement.

9. Disability of Optionee. In the event of termination of the Optionee’s
Continuous Service because of the Optionee’s Disability, the Optionee (or his or
her personal representative) may exercise this Option within a period ending on
the earlier of (a) the last day of the one-year period following the
determination of the Optionee’s Disability or (b) the expiration date of this
Option, to the extent of the number of shares that were purchasable under this
Agreement at the date of such termination.

 
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10. Death of Optionee. Except as otherwise provided in Schedule A with respect
to the rights of the Optionee upon termination of the Optionee’s Continuous
Service under Section 8 above, in the event of the Optionee’s death while
employed by the Company or any of its subsidiaries or within 90 days after a
termination of the Optionee’s Continuous Service (if such termination was
neither (x) for Cause nor (y) voluntary on the part of the Optionee and without
the written consent of the Company), the heirs, executors or personal
representatives of the Optionee may exercise this Option at any time within a
period ending on the earlier of (a) the last day of the one-year period
following the Optionee’s death or (b) the expiration date of this Option. If the
Optionee was an Employee of the Company at the time of death, this Option may be
so exercised to the extent of the number of shares that were purchasable under
this Agreement at the date of death. If the Optionee’s Continuous Service
terminated prior to his or her death, this Option may be exercised only to the
extent of the number of shares covered by this Option that were purchasable
under this Agreement at the date of such termination.

11. Compliance with Regulatory Matters. The Optionee acknowledges that the
issuance of Stock of the Company is subject to limitations imposed by federal
and state law and the Optionee hereby agrees that the Company shall not be
obligated to issue any shares of Stock upon exercise of this Option that would
cause the Company to violate law or any rule, regulation, order or consent
decree of any regulatory authority (including the Securities and Exchange
Commission) having jurisdiction over the affairs of the Company. The Optionee
agrees that he or she will provide the Company with such information as is
reasonably requested by the Company or its counsel to determine whether the
issuance of Stock complies with the provisions described by this Section 11.

12. Restriction on Disposition of Stock. The Stock purchased pursuant to the
exercise of an Incentive Stock Option shall not be transferred by the Optionee
except pursuant to the Optionee’s will, or the laws of descent and distribution,
until the date that is the later of two years after the grant of such Incentive
Stock Option or one year after the transfer of the shares to the Optionee
pursuant to the exercise of such Incentive Stock Option.

13. Withholding. The Optionee acknowledges that the Company shall require the
Optionee to pay the Company the amount of any federal, state, local or other tax
or other amount required by any governmental authority to be withheld and paid
over by the Company to such authority for the account of the Optionee. The
Optionee agrees, as a condition to the grant of the Option, to satisfy such
obligations.

14. Miscellaneous.

(a) This Agreement shall be binding upon the parties to it and their
representatives, successors and assigns.

(b) This Agreement shall be governed by the laws of the State of Georgia.

(c) Any requests or notices to be given under this Agreement shall be deemed
given, and any elections or exercises to be made or accomplished shall be deemed
made or accomplished, upon actual delivery thereof to the designated recipient,
or three days after deposit thereof in the United States mail, registered,
return receipt requested and postage prepaid, addressed, if to the Optionee, at
the address provided below and, if to the Company, to the executive offices of
the Company at 3348 Peachtree Road NE, Tower Place 200, Suite 250, Atlanta,
Georgia 30326 (or to any successor address for the Company’s executive offices
reflected in the Company’s filings with the Securities and Exchange Commission);
provided that the Optionee may change his or her address by written notice as
provided in this Section 15(c).

 
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(d) This Option does not confer upon the Optionee any right with respect to
continuance of employment by the Company or by any of its subsidiaries.

(e) Except as permitted under the Plan, this Agreement may not be modified
except in writing executed by each of the parties to it.

(f) The Background section on page 1 of this Agreement constitutes an integral
part of this Agreement.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 
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IN WITNESS WHEREOF, the Compensation Committee of the Board of Directors of the
Company has caused this Stock Option Agreement to be executed on behalf of the
Company, and the Optionee has executed this Stock Option Agreement under seal,
all as of the day and year first above written.

Xethanol Corporation
 
OPTIONEE
           
By:
   
By:
 
Name: 
   
Name:
 
Title:
   
Address: 
                     

 
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SCHEDULE A
TO
STOCK OPTION AGREEMENT
BETWEEN
XETHANOL CORPORATION
AND
 

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Dated: October 9, 2008

1. Number of Shares Subject to Option:                        shares.

2. This Option: (Check one) 
¨ is an Incentive Stock Option.
 
x is not an Incentive Stock Option.

3. Option Exercise Price: $0.19 per share.

4. Date of Grant: October 9, 2008

5. Option Vesting Schedule: The Option shall vest and become exercisable as to
the number of shares specified below upon satisfaction of the vesting conditions
described below, subject to the earlier termination or expiration of the Option
as provided below:

(a) In this Schedule A, (x) the term “Exchange” means the American Stock
Exchange, or, if applicable, any successor exchange on which the Company’s
common stock is listed; and (y) the term “Expiration Date” means October 9,
2015.

(b) One-half of the Option shall vest and become exercisable if the closing
price of the Company’s common stock as reported on the Exchange equals or
exceeds $1.50 per share for ten consecutive trading days (the “Initial Threshold
Price”) on or before the third anniversary of the date of grant; provided that
if the Initial Threshold Price is not achieved on or before the third
anniversary of the date of grant, all of the Option shall terminate.

(c) If and only if the Initial Threshold Price is achieved on or before the
third anniversary of the date of grant, an additional one-fourth of the Option
shall vest and become exercisable if the closing price of the Company’s common
stock as reported on the Exchange equals or exceeds $2.00 per share for ten
consecutive trading days on or before the Expiration Date.

(d) If and only if the Initial Threshold Price is achieved on or before the
third anniversary of the date of grant, an additional one-fourth of the Option
shall vest and become exercisable if the closing price of the Company’s common
stock as reported on the Exchange equals or exceeds $2.50 per share for ten
consecutive trading days on or before the Expiration Date.

6. Option Exercise Period: The Option shall expire and be void unless exercised
on or before the Expiration Date or on such earlier date with respect to the
number of shares indicated and as determined pursuant to Section 5 above.

7. Effect of Termination of Employment of Optionee (if different from that
provided in Sections 8, 9 and 10 of the Stock Option Agreement): Not applicable.

 
 

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SCHEDULE B
TO
STOCK OPTION AGREEMENT
BETWEEN
XETHANOL CORPORATION
AND
 

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NOTICE OF EXERCISE

The undersigned hereby notifies Xethanol Corporation (the “Company”) of this
election to exercise the undersigned’s stock option to
purchase                    shares of the Company’s common stock, par value
$0.001 per share, pursuant to the Stock Option Agreement between the undersigned
and the Company dated October 9, 2008. Accompanying this Notice of Exercise is
(x) a certified or cashier’s check payable to the Company in payment of the
total Exercise Price applicable to the shares of Stock being purchased, (y)
shares of Stock owned by the Optionee and duly endorsed or accompanied by stock
transfer powers having a Fair Market Value equal to the total Exercise Price
applicable to the shares of Stock being purchased, or (z) a certified or
cashier’s check accompanied by the number of shares of Stock whose Fair Market
Value when added to the amount of the check equals the total Exercise Price
applicable to the shares of Stock being purchased, as provided in the Stock
Option Agreement.

IN WITNESS WHEREOF, the undersigned has executed this Notice of Exercise,
effective this _____ day of ______________, _______.

OPTIONEE [OR OPTIONEE’S ADMINISTRATOR,
EXECUTOR, GUARDIAN OR LEGAL
REPRESENTATIVE]
 
By:
 
Name: 
 

Position (if other than Optionee): 
 

 
 

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