**Exhibit10.36**

 

ADVANCED CELL TECHNOLOGY, INC.

 

STOCK OPTION AGREEMENT

 

THIS AGREEMENT, made as of this 12th day of August,2004, by and between ADVANCED CELL TECHNOLOGY, INC. (“Company”), a Delawarecorporation, and                               (“Optionee”).

 

WITNESSETH:

 

WHEREAS, Company desires toprovide an incentive to Optionee, to encourage stock ownership by Optionee, toencourage Optionee to remain in the employ of Company, and to increase suchOptionee’s proprietary interest in Company’s success;

 

NOW, THEREFORE, it is agreed between Company andOptionee as follows.

 

1.                                       Stock Option—Number and Price.

 

Subject to the terms andconditions herein and to the provisions of the Advanced Cell Technology, Inc.2004 Stock Option Plan, as it may be amended from time to time (the “Plan”),the provisions of which are incorporated herein by reference, Company herebygrants to Optionee the right and option (the “Option”) to purchase from Companyup to                         shares (the “Shares”) of the Company’s Common Stock (“Stock”), par value $0.001per share, at a price of $0.05 per Share (the “Option Price”).

 

2.                                       Type of Option.

 

This Option is intended to be an incentive stock option as defined in Section 422of the Internal Revenue Code of 1986, as amended (the “Code”).

 

3.                                       Exercise—Timingand Method.

 

(a)                                  Subject to the restriction in Section 6of this Agreement, the Option may be exercised at any time on or after the dateof this Agreement with respect to the Shares vested as of the date of exercise.                   sharesof the Shares shall be deemed vested upon signature of this Agreement and theremaining Shares shall vest at a rate of                   shares as of the last day of each month following the signature of thisAgreement for so long as the Optionee remains in the employ of the Company.  All unvested Shares shall be deemed fullyvested on the date the Company executes a definitive agreement to effectuate areverse merger with a company whose stock is qualified to be quoted on the OTCBulletin Board or similar electronic quotation system or with a company whosestock is listed on a nationally recognized exchange.

 

(b)                                Optionee, from time to time during the periodwhen the Option may be exercised hereunder, may so exercise the Option in wholeor in part by delivering to Company (attention: Stock Option Plan Committee):

 

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(i)                                     A written notice signed by Optionee

 

(1)                                  stating the number of shares of Stock thatOptionee has elected to purchase at any time; and

 

(2)                                  (unless the Shares are covered by a thencurrent registration statement or a Notification under Regulation A under the SecuritiesAct of 1933 (the “Act”)) acknowledging in form and substance satisfactory tothe Company that

 

(a)                                  such Shares are being purchased forinvestment and not for distribution or resale (other than a distribution orresale which, in the opinion of counsel satisfactory to the Company, may bemade without violating the registration provisions of the Act);

 

(b)                                 the Optionee has been advised and understandsthat (i) the Shares have not been registered under the Act and are “restricted securities”within the meaning of Rule 144 under the Act and are subject to restrictions ontransfer and (ii) the Company is under no obligation to register the Sharesunder the Act or to take any action which would make available to the Optioneeany exemption from such registration;

 

(c)                                  such Shares may not be transferred withoutcompliance with all applicable federal and state securities laws;

 

(d)                                 the Optionee agrees to be bound by the termsof any shareholders agreement then in effect among all (or a substantial number)of the Company’s shareholders; and

 

(e)                                  an appropriate legend referring to theforegoing restrictions on transfer and any other restrictions imposed under theOption Documents, as defined in the Plan, may be endorsed on the certificates;and

 

(ii)                                  In an amount equal to the Option Price of theShares of Stock then to be purchased, Optionee’s cash, certified, bank orcashier’s check payable in clearing house funds to the order of the Company, orsuch other mode of payment as the Committee may approve, including (1) paymentthrough a broker in accordance with procedures permitted by Regulation T of theFederal Reserve Board, or (2) payment in whole or in part in shares of theCompany’s Common Stock held by the Optionee or to be issued to the Optioneeunder the Option, in which case Optionee shall deliver to the Companycertificates registered in the name of such Optionee representing the sharesowned by such Optionee, free of all liens, claims and encumbrances of everykind and having an aggregate Fair Market Value on the date of delivery that isat least as great as the Option Price of

 

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the Shares (or relevant portion thereof) with respect to which suchOption is to be exercised by the payment in shares of Common Stock, endorsed inblank or accompanied by stock powers duly endorsed in blank by the Optionee,

 

4.                                       Restriction on Transferability.

 

This Option is not transferable by Optionee otherwise than by will orthe laws of descent and distribution, and is exercisable, during the lifetimeof Optionee, only by Optionee.

 

5.                                       Adjustment in Number of Shares and OptionPrices: Reserved Option Shares.

 

In the event that there are any changes in the outstanding Stock of theCompany by reason of stock dividends, splits, combinations of shares,recapitalizations, reorganizations, mergers, consolidations, combinations, orexchanges of shares or the like, the number of shares subject to the Option andthe Option Price shall be appropriately adjusted by the Committee (as definedin the Plan), if necessary, to reflect equitably such change or changes.  The determination of the Committee in thisregard shall be conclusive.

 

The Company shall at all times during the term of this Agreementreserve and keep available such number of shares of Stock as will be sufficientto satisfy the requirements of this Agreement.

 

6.                                       Termination of Option.

 

(a)                                  This Option is not exercisable after (i) thetenth anniversary of the date first above written.

 

(b)                                 Notwithstanding the termination date providedin Section 6(a), no Option shall be exercisable after the date, if any,set by the Board of Directors as an accelerated expiration date in the event ofthe liquidation or dissolution of the Company.

 

(c)                                  Notwithstanding the limitations of Section 6(b),the Committee may extend the period during which all or any portion of anOption may be exercised to a date no later than the term specified in Section 6(a).

 

7.                                       Amendment.

 

The Committee shall have the right to amend this Agreement, subject tothe Optionee’s consent if such amendment is not favorable to the Optionee.  Optionee may not amend this Agreement otherthan in a writing signed by the Company and the Optionee.

 

8.                                   Right of First Refusal.

 

(a)                                  Transfer Notice.  If at any time prior to an “EffectiveTransaction” (as defined in the Company’s Certificate of Amendment ofCertificate of Incorporation), Optionee (or any transferee of Optionee subjectto or bound by this Agreement) proposes to transfer shares of

 

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Stockto one or more third parties pursuant to an understanding with such thirdparties (a “Transfer”), then Optionee shall give the Company written notice ofthe Optionee’s intention to make the Transfer (the “Transfer Notice”), whichTransfer Notice shall include (i) a description of the Stock to be transferred(“Offered Shares”), (ii) the name and address of the prospective transferee(s)and (iii) the consideration and the material terms and conditions upon whichthe proposed Transfer is to be made. The Transfer Notice shall certify that theOptionee has received a firm offer from a prospective transferee(s) and in goodfaith believes a binding agreement for the Transfer is obtainable on the termsset forth in the Transfer Notice.  TheTransfer Notice shall also include a copy of any written proposal, term sheetor letter of intent or other agreement relating to the proposed Transfer.

 

(b)                                 Company’s Option.  The Company shall have an option for a periodof fifteen (15) days from receipt of the Transfer Notice to elect to purchasethe Offered Shares at the same price and subject to the same material terms andconditions as described in the Transfer Notice. The Company may exercise such purchase option and, thereby, purchase all(but not less than all) of the Offered Shares by notifying the Optionee inwriting before such expiration of such fifteen (15) day period.  If the Company gives the Optionee notice thatit desires to purchase such shares, then payment for the Offered Shares shallbe by check or wire transfer, against delivery of the Offered Shares to bepurchased at a place agreed upon between the parties and at the time of thescheduled closing therefor, which shall be no later than forty-five (45) daysafter the Company’s receipt of the Transfer Notice, unless the Transfer Noticecontemplates a later closing with the prospective third party transferee(s). Ifthe Company fails to purchase all of the Offered Shares by exercising theoption granted in this Section 8(b) within the period provided, theOptionee may effect the Transfer upon terms not more favorable to theprospective third-party transferee than those described in the Transfer Notice.

 

(c)                                  No Offered Shares shall be transferred byOptionee until and unless the proposed transferee enters into an agreementsatisfactory to the Company agreeing to be bound by the provisions of this Section 8.

 

9.                                       General.

 

Words used in this Agreement shall have the same meaning as the samewords used in the Plan.  In the event ofany inconsistency between this Agreement and the Plan, the terms of thisAgreement shall govern.  This Agreement,together with the Plan, constitutes the parties’ entire agreement with respectto the subject matter hereof, and supersedes any and all prior and or writtenagreements or understandings with respect thereto.

 

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

 
|      | ADVANCED  CELL TECHNOLOGY, INC. |
|-----------|---------------------------------|
|      |                            |
|      |                            |
| Accepted: |                            |   | By: |   |
|      | Michael D. West, President      |
|      |                            |
|           |                                 |  |  |  |

 

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