EXHIBIT 10.11

                            NEAH POWER SYSTEMS, INC.

                      LONG TERM INCENTIVE COMPENSATION PLAN

                             STOCK OPTION AGREEMENT

                   (INCENTIVE AND NONSTATUTORY STOCK OPTIONS)



         Pursuant to your Stock Option Grant  Notice  ("Grant  Notice") and this
Stock  Option  Agreement,  Neah  Power  Systems,  Inc.,  a  Nevada  corporation,
("Company") has granted you an option under its Long Term Incentive Compensation
Plan (the "Plan") to purchase the number of shares of the Company's common stock
indicated  in your Grant Notice at the  exercise  price  indicated in your Grant
Notice.  Defined terms not explicitly defined in this Stock Option Agreement but
defined in the Plan shall have the same definitions as in the Plan.

         The details of your option are as follows:

     1. VESTING.  Subject to the limitations  contained herein, your option will
vest as provided in your Grant Notice, provided that vesting will cease upon the
termination of your Service unless such  termination is on account of your death
or Disability, in which case the Committee may, in its sole discretion,  provide
that the option will become fully vested.

     2.  NUMBER OF SHARES  AND  EXERCISE  PRICE.  The number of shares of common
stock  subject to your option and your  exercise  price per share  referenced in
your Grant  Notice may be adjusted  from time to time as provided in Sections 16
and 17 of the Plan.

     3. EXERCISE PRIOR TO VESTING ("EARLY EXERCISE"). If permitted in your Grant
Notice (I.E.,  the "Exercise  Schedule"  indicates that "Early Exercise" of your
option is permitted) and subject to the provisions of your option, you may elect
at any time that is both (i) during the period of your  Service  and (ii) during
the term of your option,  to exercise all or part of your option,  including the
nonvested portion of your option; provided, however, that:

          (A) a partial  exercise of your option  shall be deemed to cover first
vested  shares of common  stock and then the  earliest  vesting  installment  of
unvested shares of common stock;

          (B) any shares of common stock so  purchased  from  installments  that
have not vested as of the date of  exercise  shall be  subject  to the  purchase
option in favor of the  Company  as  described  in the  Company's  form of Early
Exercise Stock Purchase Agreement;

          (C) you shall enter into the Company's  form of Early  Exercise  Stock
Purchase  Agreement with a vesting schedule that will result in the same vesting
as if no early exercise had occurred; and

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          (D) if your option is an incentive stock option,  then, as provided in
the Plan, to the extent that the aggregate Fair Market Value  (determined at the
time of grant) of the shares of common  stock with  respect to which your option
plus all other  incentive  stock options you hold are  exercisable for the first
time by you during any  calendar  year  (under all plans of the  Company and its
Affiliates) exceeds one hundred thousand dollars  ($100,000),  your option(s) or
portions  thereof that exceed such limit  (according  to the order in which they
were granted) shall be treated as nonstatutory stock options.

     4. METHOD OF  PAYMENT.  Payment of the  exercise  price is due in full upon
exercise of all or any part of your option. You may elect to make payment of the
exercise price (i) in cash or by check or by (ii) tendering  previously acquired
shares  (held  for at least  six  months to the  extent  necessary  to avoid any
variable accounting on such option) or purchased on the open market and having a
Fair  Market  Value  at the  time of  exercise  equal to the  option  price,  or
certification of ownership of such previously-acquired shares, (iii) delivery of
a properly executed exercise notice, together with irrevocable instructions to a
broker to promptly  deliver to the Company the amount of sale  proceeds from the
option  shares or loan  proceeds to pay the exercise  price and any  withholding
taxes due to the Company,  or (iv) in any other  manner  permitted by your Grant
Notice,  provided, that payment of the common stock's "par value," as defined in
the Nevada General Corporation Law, shall not be made by deferred payment.

     5. WHOLE  SHARES.  You may  exercise  your option only for whole  shares of
common stock.

     6.  SECURITIES  LAW  COMPLIANCE.  Notwithstanding  anything to the contrary
contained  herein,  you may not exercise your option unless the shares of common
stock issuable upon such exercise are then  registered  under the Securities Act
or, if such shares of common stock are not then so  registered,  the Company has
determined that such exercise and issuance would be exempt from the registration
requirements of the Securities Act. The exercise of your option must also comply
with other  applicable laws and regulations  governing your option,  and you may
not exercise your option if the Company  determines that such exercise would not
be in material compliance with such laws and regulations.

     7. TERM.  You may not exercise your option before the  commencement  of its
term or after its term expires. The term of your option commences on the date of
grant and expires upon the earliest of the following:

          (A) three (3) months  after the  termination  of your  Service for any
reason other than your Disability or death,  provided that if during any part of
such three- (3-) month period your option is not  exercisable  solely because of
the condition set forth in the preceding  paragraph  relating to "Securities Law
Compliance,"  your option shall not expire  until the earlier of the  expiration
date or until it shall have been  exercisable  for an aggregate  period of three
(3) months after the termination of your Service;

          (B) twelve (12) months  after the  termination  of your Service due to
your Disability;



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          (C)  eighteen  (18) months  after your death if you die either  during
your Service or within three (3) months after your Service terminates;

          (D) the expiration date indicated in your Grant Notice; or

          (E) the day before the tenth (10th) anniversary of the date of grant.

         If your option is an incentive  stock option,  note that, to obtain the
federal income tax advantages  associated with an "incentive  stock option," the
Code  requires  that at all times  beginning on the date of grant of your option
and  ending  on the day  three  (3)  months  before  the  date of your  option's
exercise, you must be an employee of the Company or an Affiliate,  except in the
event of your  death or  Disability.  The  Company  has  provided  for  extended
exercisability  of your option under certain  circumstances for your benefit but
cannot  guarantee that your option will  necessarily be treated as an "incentive
stock option" if you continue to provide services to the Company or an Affiliate
as a consultant or director after your employment terminates or if you otherwise
exercise  your option more than three (3) months after the date your  employment
terminates.

     8. EXERCISE.

          (A) You may  exercise  the  vested  portion  of your  option  (and the
unvested portion of your option if your Grant Notice so permits) during its term
by  delivering  a notice  of  exercise  (in a form  designated  by the  Company)
together  with the exercise  price to the  Secretary of the Company,  or to such
other  person as the Company  may  designate,  during  regular  business  hours,
together with such additional documents as the Company may then require.

          (B) By  exercising  your option you agree that,  as a condition to any
exercise  of  your  option,  the  Company  may  require  you to  enter  into  an
arrangement  providing  for  the  payment  by  you  to the  Company  of any  tax
withholding  obligation of the Company  arising by reason of (1) the exercise of
your option,  (2) the lapse of any  substantial  risk of forfeiture to which the
shares  of  common  stock  are  subject  at the  time  of  exercise,  or (3) the
disposition of shares of common stock acquired upon such exercise.

          (C) If your option is an incentive  stock option,  by exercising  your
option you agree that you will notify the Company in writing within fifteen (15)
days after the date of any  disposition of any of the shares of the Common Stock
issued upon  exercise of your option that occurs  within two (2) years after the
date of your  option  grant or within one (1) year  after such  shares of common
stock are transferred upon exercise of your option.

          (D) By  exercising  your  option  you  agree  that the  Company  (or a
representative  of  the  underwriter(s))  may,  in  connection  with  the  first
underwritten registration of the offering of any securities of the Company under
the Securities Act, require that you not sell,  dispose of,  transfer,  make any
short sale of,  grant any option for the  purchase of, or enter into any hedging
or similar  transaction  with the same economic  effect as a sale, any shares of
common  stock or other  securities  of the Company  held by you, for a period of
time  specified by the  underwriter(s)  (not to exceed one hundred  eighty (180)
days) following the effective date of the registration  statement of the Company
filed under the  Securities  Act. You further  agree to execute and deliver such
other  agreements  as may be  reasonably  requested  by the  Company  and/or the




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underwriter(s)  that are consistent  with the foregoing or that are necessary to
give further effect  thereto.  In order to enforce the foregoing  covenant,  the
Company may impose  stop-transfer  instructions  with  respect to your shares of
common stock until the end of such period.

     9. TRANSFERABILITY. Your option shall not be transferable otherwise than by
will or the laws of descent and  distribution,  and shall be exercisable  during
your  lifetime  only by you or, in the  event of  Disability,  by your  personal
representative. In the event of your death, your option may be exercised only by
the  executor or  administrator  of your estate or the person or persons to whom
your  rights  under the option  shall  pass by will or the laws of  descent  and
distribution.

     10.  RIGHT OF FIRST  REFUSAL.  Shares of common stock that you acquire upon
exercise of your option are  subject to any right of first  refusal  that may be
described in the Company's  bylaws in effect at such time the Company  elects to
exercise its right.  The  Company's  right of first  refusal shall expire on the
date that the common stock first  becomes  traded on an  established  securities
market.

     11. RIGHT OF REPURCHASE.  To the extent provided in the Company's bylaws as
amended from time to time, the Company shall have the right to repurchase all or
any part of the shares of common  stock you acquire  pursuant to the exercise of
your option.

     12.  OPTION NOT A SERVICE  CONTRACT.  Your option is not an  employment  or
service  contract,  and nothing in your option  shall be deemed to create in any
way  whatsoever  any  obligation  on your part to  continue in the employ of the
Company or an  Affiliate,  or of the Company or an  Affiliate  to continue  your
employment. In addition, nothing in your option shall obligate the Company or an
Affiliate,  their  respective  shareholders,  boards of  directors,  officers or
employees  to  continue  any  relationship  that you might have as a director or
consultant for the Company or an Affiliate.

     13. WITHHOLDING OBLIGATIONS.

          (A) At the time you exercise  your option,  in whole or in part, or at
any  time  thereafter  as  requested  by  the  Company,   you  hereby  authorize
withholding  from payroll and any other  amounts  payable to you, and  otherwise
agree  to make  adequate  provision  for  (including  by  means  of a  "cashless
exercise"  pursuant to a program  developed under Regulation T as promulgated by
the Federal  Reserve  Board to the extent  permitted by the  Company),  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 your option.

          (B) Upon your request and subject to approval by the  Company,  in its
sole discretion,  and compliance with any applicable  conditions or restrictions
of law,  the Company  may  withhold  from fully  vested  shares of common  stock
otherwise  issuable  to you upon the  exercise  of your option a number of whole
shares of common stock 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.  If the  date  of  determination  of any  tax  withholding
obligation is deferred to a date later than the date of exercise of your option,
share  withholding  pursuant to the  preceding  sentence  shall not be permitted
unless you make a proper and timely



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election  under  Section  83(b) of the Code,  covering the  aggregate  number of
shares of common stock  acquired  upon such  exercise with respect to which such
determination is otherwise deferred, to accelerate the determination of such tax
withholding  obligation to the date of exercise of your option.  Notwithstanding
the filing of such  election,  shares of common  stock shall be withheld  solely
from fully vested  shares of common stock  determined as of the date of exercise
of your  option  that are  otherwise  issuable  to you upon such  exercise.  Any
adverse  consequences to you arising in connection  with such share  withholding
procedure shall be your sole responsibility.

          (C)  You may not  exercise  your  option  unless  the tax  withholding
obligations of the Company and/or any Affiliate are satisfied.  Accordingly, you
may not be able to exercise  your option when desired even though your option is
vested, and the Company shall have no obligation to issue a certificate for such
shares of common  stock or release  such shares of common  stock from any escrow
provided for herein.

     14. NOTICES.  Any notices  provided for in your option or the Plan shall be
given in writing and shall be deemed  effectively  given upon receipt or, in the
case of notices  delivered  by mail by the  Company to you,  five (5) days after
deposit in the United States mail, postage prepaid, addressed to you at the last
address you provided to the Company.

     15.  GOVERNING PLAN DOCUMENT.  Your option is subject to all the provisions
of the Plan, the provisions of which are hereby made a part of your option,  and
is further  subject to all  interpretations,  amendments,  rules and regulations
which may from time to time be promulgated and adopted  pursuant to the Plan. In
the event of any conflict between the provisions of your option and those of the
Plan, the provisions of the Plan shall control.



NEAH POWER SYSTEMS, INC.                   GRANTEE:




By:
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Signature                                  Signature

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