**Exhibit 10.2**

**DEPOMED, INC.**

**1995 STOCK OPTIONPLAN**

**INCENTIVE STOCKOPTION AGREEMENT**
| (A) | Name of Optionee:  |
|-----|--------------------|
| (B) | Grant Date:        |
| (C) | Number of Shares:  |
| (D) | Exercise Price:    |
| (E) | Vesting Base Date: |

 

THIS INCENTIVE STOCK OPTION AGREEMENT (the “Agreement”)is made and entered into as of the date set forth in Item B above (the “GrantDate”) between Depomed, Inc., a California (the “Company”), and the personnamed in Item A above (“Optionee”).

THE PARTIES AGREE AS FOLLOWS:

# 1.                                       Grantof Option; Vesting Base Date.

## 1.1.                              Grant.  The Company hereby grants to Optioneepursuant to the Company’s 1995 Stock Option Plan (the “Plan”), a copy of whichis attached to this Agreement as Exhibit 1, an incentive stock option (the “ISO”)to purchase all or any part of an aggregate of the number of shares (the “ISOShares”) of the Company’s Common Stock (as defined in the Plan) listed in ItemC above on the terms and conditions set forth herein and in the Plan, the termsand conditions of the Plan being hereby incorporated into this Agreement byreference.

## 1.2.                              VestingBase Date.  The parties herebyestablish the date set forth in Item E above as the Vesting Base Date (asdefined in Section 5.1 below).

# 2.                                       ExercisePrice.  The exercise price forpurchase of each share of Common Stock covered by this ISO shall be the priceset forth in Item D above.

# 3.                                       Term.  Unless otherwise specified on Exhibit 3attached hereto, if any (the absence of such exhibit indicating that no suchexhibit was intended), this ISO shall expire as provided in Section 6.1.12 ofthe Plan.

# 4.                                       Adjustmentof ISOs.  The Company shall adjustthe number and kind of shares and the exercise price thereof in certaincircumstances in accordance with the provisions of Section 6.1.1 of the Plan.

# 5.                                       Exerciseof Options.

## 5.1.                              Vesting;Time of Exercise.  This ISO shall beexercisable according to the schedule set forth on Exhibit 5.1 attachedhereto.  Such schedule shall commence asof the date set forth in Item E above (the “Vesting Base Date”).

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## 5.2.                              ExerciseAfter Termination of Status as an Employee, Director or Consultant.  In the event of termination of Optionee’scontinuous status as an employee, director or consultant, this ISO may beexercised only in accordance with the provisions of Section 6.1.7 of the Plan.

## 5.3.                              Mannerof Exercise.  Optionee may exercisethis ISO, or any portion of this ISO, by giving written notice to the Companyat its principal executive office, to the attention of the officer of theCompany designated by the Plan Administrator, acco­mpanied by a Notice ofExercise in substantially the form attached hereto as Exhibit 5.3 executed byOptionee, payment of the exercise price and payment of any applicablewithholding or employment taxes.  Thedate the Company receives written notice of an exercise hereunder accompaniedby payment will be considered as the date this ISO was exercised.

## 5.4.                              Payment.  Except as provided in Exhibit 5.4 attachedhereto, if any (the absence of such exhibit indicating that no exhibit was intended),payment may be made for ISO Shares purchased at the time written notice ofexercise of the ISO is given to the Company, by delivery of cash, check orpreviously owned shares of Common Stock (provided that delivery of previouslyowned shares may not be made more than once in any six-monthperiod).  The proceeds of any paymentshall constitute general funds of the Company.

## 5.5.                              Deliveryof Certificate.  Promptly afterreceipt of written notice of exercise of the ISO, the Company shall, withoutstock issue or transfer taxes to the Optionee or other person entitled toexercise, deliver to the Optionee or other person a certificate or certificatesfor the requisite number of ISO Shares. An Optionee or transferee of an Optionee shall not have any privilegesas a stockholder with respect to any ISO Shares covered by the option until thedate of issuance of a stock certificate.

# 6.                                       Nonassignabilityof ISO.  This ISO is not assignableor transferable by Optionee except by will or by the laws of descent and distribution.  During the life of Optionee, the ISO isexercisable only by the Optionee.  Anyattempt to assign, pledge, transfer, hypothecate or otherwise dispose of thisISO in a manner not herein permitted, and any levy of execution, attachment, orsimilar process on this ISO, shall be null and void.

# 7.                                       MarketStandoff.  Optionee hereby agreesthat if so requested by the Company or any representative of the underwritersin connection with any registration of the offering of the securities of theCompany under the Securities Act of 1933, as amended (the “Securities Act”),Optionee shall not sell or otherwise transfer the ISO Shares for a period of180 days following the effective date of a Registration Statement filed  under the Securities Act; provided that suchrestrictions shall only apply to the first two registration statements of theCompany to become effective under the Securities Act which include securitiesto be sold on behalf of the Company in an underwritten public offering underthe Securities Act.  The Company mayimpose stop-transfer instructions with respect to the ISO Shares subjectto the foregoing restrictions until the end of each such 180-day period.

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# 8.                                       Restrictionon Issuance of Shares.

## 8.1.                              Legalityof Issuance.  The Company shall not beobligated to sell or issue any ISO Shares pursuant to this Agreement if suchsale or issuance, in the opinion of the Company and the Company’s counsel,might constitute a violation by the Company of any provision of law, includingwithout limitation the provisions of the Securities Act.

## 8.2.                              Registrationor Qualification of Securities.  TheCompany may, but shall not be required to, register or qualify the sale of thisISO or any ISO Shares under the Securities Act or any other applicablelaw.  The Company shall not be obligatedto take any affirmative action in order to cause the grant or exercise of thisoption or the issuance or sale of any ISO Shares pursuant thereto to complywith any law.

# 9.                                       Restrictionon Transfer.  Regardless whether thesale of the ISO Shares has been registered under the Securities Act or has beenregistered or qualified under the securities laws of any state, the Company mayimpose restrictions upon the sale, pledge or other transfer of ISO Shares(including the placement of appropriate legends on stock certificates) if, inthe judgment of the Company and the Company’s counsel, such restrictions arenecessary or desirable in order to achieve compliance with the provisions ofthe Securities Act, the securities laws of any state, or any other law.

# 10.                                 StockCertificate.  Stock certificatesevidencing ISO Shares may bear such restrictive legends as the Company and theCompany’s counsel deem necessary or advisable under applicable law or pursuantto this Agreement.

# 11.                                 DisqualifyingDispositions.  If stock acquired byexercise of this ISO is disposed of within two years after the Grant Date orwithin one year after date of such exercise (as determined under Section 5.3 ofthis Agreement), the Optionee immediately prior to the disposition shallpromptly notify the Company in writing of the date and terms of the dispositionand shall provide such other information regarding the disposition as theCompany may reasonably require.

# 12.                                 Employmentor Consulting Relationship.  Nothingin this Agreement shall interfere with or limit in any way the right of theCompany or of any of its Affiliates to terminate the Optionee’s employment orconsulting at any time, nor confer upon the Optionee any right to continue inthe employ of, or consult with, the Company or any of its Affiliates.

# 13.                                 Assignment;Binding Effect.  Subject to thelimitations set forth in this Agreement, this Agreement shall be binding uponand inure to the benefit of the executors, administrators, heirs, legalrepresentatives, and successors of the parties hereto; provided, however, thatOptionee may not assign any of Optionee’s rights under this Agreement.

# 14.                                 Damages.  Optionee shall be liable to the Company forall costs and damages, including incidental and consequential damages,resulting from a disposition of ISO Shares which is not in conformity with theprovisions of this Agreement.

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# 15.                                 GoverningLaw.  This Agreement shall begoverned by, and construed in accordance with, the laws of the State ofCalifornia excluding those laws that direct the application of the laws ofanother jurisdiction.

# 16.                                 Notices.  All notices and other communications underthis Agreement shall be in writing. Unless and until the Optionee is notified in writing to the contrary,all notices, communications, and documents directed to the Company and relatedto the Agreement, if not delivered by hand, shall be mailed, addressed asfollows:

Depomed, Inc.

1360 O’Brien Drive

Menlo Park, CA   94025

Unless and until the Company is notified in writing tothe contrary, all notices, communications, and documents intended for theOptionee and related to this Agreement, if not delivered by hand, shall bemailed to Optionee’s last known address as shown on the Company’s books.  Notices and communications shall be mailed byfirst class mail, postage prepaid; documents shall be mailed by registeredmail, return receipt requested, postage prepaid.  All mailings and deliveries related to thisAgreement shall be deemed received when actually received, if by hand delivery,and two business days after mailing, if by mail.

IN WITNESS WHEREOF, the parties have executed thisIncentive Stock Option Agreement as of the Grant Date.
|        | DEPOMED, INC. |
|--------|---------------|
|   |          |
|   |          |
|   | By:           |   |
|   |          | Title: President and CEO |

 

The Optionee hereby accepts and agrees to be bound byall of the terms and conditions of this Agreement and the Plan.
|        | Optionee: |   |
|--------|-----------|--------|
|   |      |   |
| Dated: |      |   |
|        |           |        |  |  |

 

Optionee’s spouse indicates by the execution of thisIncentive Stock Option Agreement his or her consent to be bound by the termsthereof as to his or her interests, whether as community property or otherwise,if any, in the option granted hereunder, and in any ISO Shares purchasedpursuant to this Agreement.
|        | Optionee’s Spouse: |   |
|--------|-------------------------|--------|
|   |                    |   |
| Dated: |                    |   |
|        |                         |        |  |  |

 

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