ex10-12.htm


    Exhibit 10.12

    
 

    STOCK
      OPTION AGREEMENT

    


    


    This
      STOCK OPTION AGREEMENT (the "Agreement") is effective this __th day of _________
      2007, between DEER VALLEY CORPORATION, a Florida corporation, (the "Company")
      and _______________ (the "Director").

    


    BACKGROUND
      INFORMATION

    


    The
      Company desires to promote the long-term interests of the Company by attracting
      and retaining qualified and experienced persons for service as directors of
      the
      Company and by providing an additional incentive for such directors to work
      for
      the success and growth of the Company through continuing ownership of the
      Company’s common stock and encouraging them to remain directors of the
      Company.  In order to achieve such goals, the Company has determined
      to provide certain individuals with compensation opportunities based on the
      performance of the Company's common stock.  To that end, the Company
      adopted a 2007 Long Term Incentive Plan effective as of July 1, 2007 (the
      "Plan"), a copy of which is available at the Company’s executive offices, and
      has decided to grant the Director an option under such Plan.  Director
      acknowledges and represents that he has reviewed the terms of this Agreement,
      has received a copy of the Plan and has been advised of his right to consult
      with a tax advisor, financial consultant or legal counsel to obtain legal or
      financial advice regarding this Agreement.  Accordingly, in
      consideration of the mutual covenants hereinafter set forth and for other good
      and valuable consideration, the parties hereto agree as follows:

    


    OPERATIVE
      PROVISIONS

    


    1.            Grant
      of Option.  Subject to the terms of the Plan, the Company hereby
      irrevocably grants to the Director the right and option (the "Option"), to
      purchase all or any part of an aggregate of ______ shares (such number being
      subject to adjustment as provided in paragraph 9 hereof) of the Company’ s
      common stock (the "Share" or "Option Shares") on the terms and conditions herein
      set forth.  The Option granted under this Agreement is not intended to
      qualify as an Incentive Stock Option within the meaning of §422 of the Internal
      Revenue Code of 1986, as amended, and regulations promulgated
      thereunder.

    


    2.            Purchase
      Price.  Subject to the adjustments provided for by paragraph 9 of
      this Agreement, the purchase price of each Share covered by the Option shall
      be
      $______ per share.

    


    3.            Term
      of the Option.  The maximum term of the Option shall be for a
      period of ten (10) years after the date the Option is granted.

    


    4.           
      Immediate Vesting; Exercise of Option.  The Option is fully
      vested and may be exercised in accordance with the terms and conditions of
      the
      Plan and this Agreement, subject to paragraphs 6 through 9 hereof.

    


    The
      Director shall be entitled to exercise any portion of the Option in accordance
      with the provisions of paragraph 5. hereof, either in whole or in part, by
      delivering written notice of such exercise
      to the office of the Secretary of the Company or to such other location as
      may
      be designated by the Company, specifying therein the number of Option Shares
      with respect to which the Option is being exercised, which notice shall be
      accompanied by payment in full of the purchase price of the Shares being
      acquired.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    5.           Payment
      of Exercise Price.  Payment shall be made in
      cash.  Subject to the Director's compliance with Section 16(b) of the
      Securities Exchange Act of 1934 (the "Exchange Act"), as determined by the
      Company, the Company may also permit the Director to simultaneously exercise
      the
      Option and sell the Shares thereby acquired pursuant to a "cashless exercise"
      arrangement and accept payment from a broker-dealer selected by and approved
      of
      in all respects by the Company and use the proceeds from such sale as payment
      of
      the exercise price of such Shares.  No Shares shall be issued until
      full payment therefore has been made in the manner set forth above.

    


    6.           Director
      Status.  In the event that the term of the Director is terminated
      "For Cause" by the Company, the Option shall expire immediately and any Options
      that have not been exercised shall be forfeited as of such date. In the event
      that the Company terminates the Director other than "For Cause" during his
      term
      or the Directors fails to stand for reelection, the Director shall be given
      ninety (90) days after the date of such termination to exercise the Option
      with
      respect to any Option Shares, or any portion thereof that was exercisable as
      of
      the date of termination.  The Options shall not be affected by any
      change of duties or position of the Director.

    


    For
      purposes of this Agreement, the
      phrase "For Cause" shall mean termination based upon (a)  conviction
      of the Director for any crime involving moral turpitude (whether or not a
      felony) or any other criminal act against the Company involving dishonesty
      or
      willful misconduct intending to injure the Company; (b) the failure or the
      refusal of the Director to follow lawful and proper directives of the Company's
      full Board of Directors; (c) malfeasance or misconduct by the Director
      which discredits or damages the Company; (d) the indictment of the Director
      for a felony violation of federal or state laws; or (e) failure of the Director
      to perform his duties in a manner commensurate with the standards established
      from time to time by the Board of Directors of the Company or which may be
      reasonably expected by a Board of Directors of a comparable
      company.

    


    7.           Death
      or Disability of the Director.  If membership of the Director
      terminates due to death or disability, the Option shall expire at the end of
      the
      twelve month period following such termination of membership or the date the
      Option expires in accordance with its terms, whichever occurs
      first.  The Option may be exercised by the Director, or if deceased,
      by the Director’s successor(s) in interest, whom shall include, but not be
      limited to, the Director’s devisee(s), legatee(s), trustee(s) or personal
      representative(s) or executor(s) of his estate, with respect to the same number
      of Shares and in the same manner, and to the same extent as if the Director
      had
      continued his membership during such period and the Option shall be canceled
      with respect to all remaining Shares otherwise subject to the
      Option.

    


    8.           Transferability
      of Option.  The Option may be transferred in accordance with
      Section 4.6 of the Plan.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    9.           
      Stock Certificates.  Upon exercise of the Option and payment of
      the exercise price, the Company shall deliver a certificate or certificates
      representing such Shares as soon as practicable after the notice shall be
      received; or (b) fix a date (not less than five (5) nor more than ten (10)
      business days from the date such notice shall be received by the Company) for
      the payment of the full purchase price of such Shares with the Secretary of
      the
      Company, against delivery of a certificate or certificates representing such
      shares.  The certificate or certificates for the Shares as to which
      the Option shall have been so exercised shall be registered in the name of
      the
      person or persons so exercising the Option (or, if the Option shall be exercised
      by the Director and if the Director shall so request in the notice exercising
      the Option, shall be registered in the name of the Director and another person
      jointly, with right of survivorship) and shall be delivered upon the written
      order of the person or persons exercising the Option.  In the event
      the Option shall be exercised pursuant to Section 8. hereof by any person or
      persons other than the Director, such notice shall be accompanied by appropriate
      proof of the right of such person or persons to exercise the
      Option.  All shares that shall be purchased upon the exercise of the
      Option as provided herein shall be fully paid and non-assessable.

    


    10.           No
      Additional Rights.  The Director shall have no right to be
      employed by the Company  under the terms of this Agreement or
      interfere in any way with the right of the Company to terminate any employment
      of the Director at any time.  Neither the Director nor any other
      person entitled to exercise the Option under the terms hereof shall be, or
      have
      any of the rights or privileges of, a shareholder of the Company with respect
      to
      any of the shares of common stock issuable upon exercise of the Option, unless
      and until the purchase price for such shares shall have been paid in
      full.

    


    11.           Notices.  All
      notices and other communications given or made pursuant hereto shall be in
      writing and shall be deemed to have been given on the day delivered if delivered
      personally, within three (3) Business Days (as defined below) after being sent
      if sent by registered or certified mail (postage prepaid, return receipt
      requested), the next day after being sent if sent by overnight courier (prepaid)
      or the next day after being sent if sent by telecopier to either party at the
      following address:

    


     

                If
      to the
      Company:

    


                    Deer
      Valley
      Corporation

                    4218
      West Linebaugh
      Avenue

                    Tampa,
      Florida  33624

                    Attention:
      Charles G.
      Masters, C.E.O.

                    Telephone:
      (813)
      885-5998

                    Telecopier:
      (813)
      885-5911

                     E-Mail:
      cmasters@tampabay.rr.com

                                     
      

                With
      a Copy
      to:

    


    Bush
      Ross, P.A.

    Attn:
      Brent Jones, Esq.

    220
      South
      Franklin Street

    Tampa,
      Florida 33602

    Attention:
      Brent Jones, Esq.

    Telephone:
      (813) 224-9255

    Telecopier:
      (813) 223-9620

    E-mail:  bjones@bushross.com

     

                If
      to the
      Director:

    


    Deer
      Valley Homebuilders, Inc.

    Attn:
      John Steven Lawler

    205
      Carriage Street

    Guin,
      Alabama 35563

    Telephone:
      (727) 499-2155

    Telecopier:
      (727) 587-6560

    E-Mail:
      slawler@deervalleyhb.com

     

    
      or
        to
        such other address as either party shall have specified for itself or himself
        from time to time to the other party in writing. For purposes of this Agreement,
        the term "Business Day" shall mean any day other than a
        Saturday, a Sunday or any day on which commercial banks in Tampa, Florida
        are
        authorized or required by law to close.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    12.           Investment
      Purpose.  The Option is granted on the express condition that the
      purchase of shares upon an exercise hereof shall be made for investment purposes
      only and not with a view to their resale or further distribution unless such
      shares, at the time of their issuance and delivery, are registered under the
      Securities Act of 1933, as amended, or, alternatively, at some time following
      such issuance their resale is determined by counsel for the Company to be exempt
      from the registration requirements of the Act and of any other applicable law,
      regulation or ruling.

    


    Within
      five (5) business days after the exercise date, the Company shall, subject
      to
      the receipt of withholding tax, if any, issue to the Director the number of
      shares with respect to which such Option shall be so exercised, and shall
      deliver to the Director a certificate (or certificates) therefor.  The
      certificate shall bear the following legends, if applicable:

    


    "THIS
      COMMON STOCK HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
      AMENDED (THE ACT), OR APPLICABLE STATE SECURITIES LAW AND MAY BE OFFERED, SOLD,
      OR TRANSFERRED ONLY IF REGISTERED PURSUANT TO THE PROVISIONS OF THE ACT OR
      APPLICABLE STATE SECURITIES LAW OR IF THE PROVISIONS OF RULE 144(K) UNDER THE
      ACT ARE APPLICABLE OR IF IN THE OPINION OF COUNSEL SATISFACTORY
      TO THE COMPANY AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE."

    


    "THE
      COMMON STOCK REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO CERTAIN RESTRICTIONS
      ON TRANSFER AND RIGHTS OF PURCHASE AND CERTAIN OTHER REQUIREMENTS THAT ARE
      FULLY
      SET FORTH IN THIS AGREEMENT.  ANY SUCH TRANSFER OR ACQUISITION IN
      VIOLATION OF SUCH AGREEMENT(S) IS NULL AND VOID, AND SUCH LATTER AGREEMENT
      IS
      AUTOMATICALLY BINDING ON ANY PERSON WHO ACQUIRES THE SHARES.  COPIES
      OF THE AGREEMENTS ARE ON FILE AND MAY BE INSPECTED AT THE PRINCIPAL BUSINESS
      OFFICE OF DEER VALLEY CORPORATION"

    


    13.           Tax
      Withholding.  The Company shall have the right to deduct from any
      payment or settlement upon the exercise of any stock option, or the delivery
      of
      any Shares, any federal, state, local or other taxes of any kind which the
      Company, in its sole discretion, deems necessary to be withheld to comply with
      the Internal Revenue Code and/or any other applicable law, rule or
      regulation.  In addition, in the event that the Director disposes of
      any Shares, the Company shall have the right to require the Director to remit
      to
      the Company an amount sufficient to satisfy all federal, state, and local
      withholding tax requirements as a condition to registering the transfer of
      such
      Shares on its books.  If the Company, in its sole discretion, permits
      Shares of the Company’s common stock to be used to satisfy any such tax
      withholding, such shares shall be valued based on the fair market value of
      such
      shares as of the date the tax withholding is required to be made, on the same
      basis as set forth in paragraph 5 above.

    


    14.           General.  The
      Company shall at all times during the term of the Option reserve and keep
      available such number of shares of its common stock as will be sufficient to
      satisfy the requirements of this Agreement, shall pay all original issue and
      transfer taxes with respect to the issue and transfer of shares pursuant hereto
      and all other fees and expenses necessarily incurred by the Company in
      connection therewith, and will from time to time use its best efforts to comply
      with all laws and regulations which, in the opinion of counsel for the
      Company,  shall be applicable thereto.  The Option shall be
      exercised in accordance with such administrative regulations as the Company
      shall from time to time adopt and may be amended from time to time by the
      Company in its sole and absolute discretion.

    


    15.           Acceptance
      by Director.  The exercise of the Option is conditioned upon the
      acceptance of Director of the terms hereof as evidenced by his execution of
      this
      Agreement.  Because the terms of this Agreement contain specific terms
      and conditions that may not be addressed in the Plan, Director agrees that
      the
      terms of this Agreement will be binding and control in the event that any
      discrepancy arises between the terms of the Plan and this
      Agreement.  Director acknowledges and represents that he has reviewed
      the terms of this Agreement, has received a copy of the Plan and has been
      advised of his right to consult with a tax advisor, financial consultant or
      legal counsel to obtain legal or financial advice regarding this
      Agreement.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


                    16.           Application
      of Florida Law.  This Agreement, and the application or
      interpretation thereof, shall be governed exclusively by its terms and by the
      laws of the State of Florida.  Venue for all purposes shall be deemed
      to lie within Tampa of Hillsborough County, Florida.

    


                    17.           Remedies
      for Breach of Agreement.  The breach of any confidentiality,
      non-disclosure or non-competition covenants by Director under any applicable
      agreement entered into by and between the Company and Director or the breach
      by
      Director of the terms of this Agreement is acknowledged by the parties hereto
      to
      constitute harm to the Company of an extraordinary character which could cause
      the Company to suffer irreparable damages which could not readily be compensated
      by a monetary judgment.  Director agrees that the Company shall be
      entitled, in addition to all other remedies available to it upon a breach by
      Director of his obligations hereunder, to such equitable relief, whether by
      way
      of injunction or action for specific performance, or otherwise as a court might
      impose, without the necessity of proving actual monetary damage for any breach
      by Director of this Agreement or of any undertaking herein
      contained.

    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    [Stock
      Option Agreement]

    


    The
      Director and the Company have executed this Agreement on the day and year
      first  written above.

    


    


    Deer
      Valley Corporation

    


    


    By:                                                                

    Charles
      G. Masters, Chief Executive Officer

    


    DIRECTOR: