Exhibit 4.2  SYNERGY PHARMACEUTICALS, INC.
2009 DIRECTORS STOCK OPTION PLAN  1.  PURPOSE. The purpose of the Synergy
Pharmaceuticals, Inc. 2009 Directors Stock Option Plan (the Plan) is to
advance the interests of Synergy Pharmaceuticals, Inc. (the Company) by
providing non-employee directors of the Company, through the grant of options
to purchase shares of Common Stock (as hereinafter defined), with a larger
personal and financial interest in the Companys success.  2.  ADMINISTRATION. The Plan shall be
administered by the Companys Compensation Committee (the Committee)
consisting of at least two independent members of the Board of Directors of the
Company (the Board). The Committee shall have full power and authority to
interpret the Plan, to establish such rules and regulations as it deems
appropriate for the administration of the Plan, and to take such other action
as it deems necessary or desirable for the administration of the Plan. The
Committees interpretation and construction of any provision of the Plan or the
terms of any Option (as hereinafter defined) shall be conclusive and binding on
all parties.  3.  PARTICIPANTS. Each director of the Company
who is not an employee or consultant of the Company (an Outside Director)
shall be eligible to be granted Options to purchase shares of Common Stock (Options)
under the Plan.  Nothing
contained in the Plan, or in any Option granted pursuant to the Plan, shall
confer upon any Director any right to the continuation of his or her
directorship or limit in any way the right of the Company to terminate his or
her directorship at any time.  4.  THE SHARES. Options may be granted from time
to time under the Plan for the purchase, in the aggregate, of not more than
1,000,000 shares of common stock, par value $0.0001 per share, of the Company (Common
Stock) (subject to adjustment pursuant to Section 13). Such shares of
Common Stock may be set aside out of the authorized but unissued shares of
Common Stock not reserved for any other purpose or out of previously issued
shares acquired by the Company and held in its treasury. Any shares of Common
Stock which, by reason of the termination or expiration of an Option or
otherwise, are no longer subject to purchase pursuant to an Option granted
under the Plan may again be subjected to an Option under the Plan.  5.  OPTION GRANTS. Options shall be evidenced by
Option agreements which shall be subject to the terms and conditions set forth
in the Plan and such other terms and conditions not inconsistent herewith as
the Committee may approve.  (a)As of the effective date of
his or her initial appointment or election to the Board (the Initial
Appointment Date), an Outside Director shall receive a grant of an Option to
purchase 50,000 shares of Common Stock (subject to adjustment pursuant to Section 13).


(b)Upon the date of the Annual
Meeting of Stockholders of the Company to be held in 2010 (the 2010 Annual
Meeting) or any adjournment or adjournments thereof, each Outside Director who
has been reelected at the 2010 Annual Meeting and is continuing as a member of
the Board as of the completion of the 2010 Annual Meeting shall receive an
Option to purchase 15,000 shares of Common Stock (subject to adjustment
pursuant to Section 13).  (c)each year after the 2010
Annual Meeting, upon the date of an Annual Meeting of Stockholders of the
Company (an Annual Meeting) each Outside Director who has been reelected at
such Annual Meeting and is continuing as a member of the Board as of the
completion of such Annual Meeting shall receive an Option to purchase 15,000
shares of Common Stock (subject to adjustment pursuant to Section 13);
provided, however, that an Outside Director who has been reelected at such
Annual Meeting and is continuing as a member of the Board as of the completion
of such Annual Meeting but has not been a member of the Board during the entire
period between such Annual Meeting and the prior Annual Meeting shall receive
an Option to purchase that number of shares equal to the product of (i) 15,000
and (ii) a fraction, where the numerator is the number of days in the
12-month period immediately preceding such Annual Meeting during which such
Outside Director was an Outside Director and the denominator is 365.  (d)each year upon the date of
an Annual Meeting, the Board shall have the sole discretion to grant to any Non
Employee Director who has been elected at such Annual Meeting and is continuing
as a member of the Board as of the completion of such Annual Meeting and,
during the time period between such Annual Meeting and the prior Annual
Meeting, who (i) has served on a committee of the Board (but who has not
served as the chairman of a Board Committee), including but not limited to, the
Audit Committee, the Compensation Committee and the Corporate Governance/Nominating
Committee (each, a Board Committee), an Option to purchase up to 6,000 shares
of Common Stock and (ii) has served as the chairman of a Board Committee,
an Option to purchase up to 10,000 shares of Common Stock, subject to
adjustment as provided in Section 13.  6.  OPTION PRICE. The price (the Option Price)
at which shares of Common Stock may be purchased upon the exercise of an Option
granted under the Plan shall be the fair market value of such shares on the
date of grant of such Option. As used herein, fair market value shall be the
closing price of the Common Stock on the date of determination (if the Common
Stock is then traded on a national securities exchange or in the Nasdaq
National Market System) or, if not so traded, the average of the closing bid
and asked prices thereof on such day or, if the Common Stock is not traded on
the date of determination, on the last preceding date on which the Common Stock
is traded.  7.  TERM AND EXERCISABILITY OF OPTIONS. Options
shall be granted for a maximum term of 10 years. Subject to the other
provisions of the Plan relating to exercisability of Options, or as otherwise
provided by the Committee and evidenced in an Option agreement, (i) the
participant who received a grant on the Initial Appointment Date shall have the
cumulative right as of the first, second, and third anniversaries of the date
of grant, to purchase up to one-third, two-thirds, and 100%, respectively, of
the


Option
Shares and (ii) the participant who receives a grant on a date other than
the Initial Appointment Date shall have the right as of the first anniversary
of the date of grant to purchase up to 100% of the Option Shares; provided,
however, that in the event of a Change of Control, the participant shall have
the cumulative right to purchase up to 100% of the Option Shares. Vesting of an
Option will cease on the date of the participant ceasing to be a director of
the Company.  A
Change of Control means the happening of any of the following:  (a)  When any person, as defined in Section 3(a)(9) of
the Securities Exchange Act of 1934 (the Exchange Act) and as used in
Sections 13(d) and 14(d) thereof, including a group as defined in Section 13(d) of
the Exchange Act, but excluding the Company and any subsidiary and any employee
benefit plan sponsored or maintained by the Company or any subsidiary
(including any trustee of such plan acting as trustee), or any person, entity
or group specifically excluded by the Board, directly or indirectly, becomes
the beneficial owner (as defined in Rule 13d-3 under the Exchange Act, as
amended from time to time) of securities of the Company representing 20 percent
or more of the combined voting power of the Companys then outstanding
securities;  (b)  When Incumbent Directors cease for any reason
to constitute at least two-thirds of the Board (where Incumbent Director means
any director on the date of adoption of the Plan and any director elected by,
or on the recommendation of, or with the approval of, a majority of the
directors who then qualified as Incumbent Directors);  (c)  The effective date of any merger or
consolidation of the Company with another corporation where (i) the
shareholders of the Company, immediately prior to the merger or consolidation,
do not beneficially own, immediately after the merger or consolidation, shares
entitling such shareholders to 50% or more of all votes (without consideration
of the rights of any class of stock to elect directors by a separate class
vote) to which all shareholders of the corporation issuing cash or securities
in the merger or consolidation would be entitled in the election of directors,
or (ii) where the members of the Board, immediately prior to the merger or
consolidation, do not, immediately after the merger or consolidation, constitute
a majority of the board of directors of the corporation issuing cash or
securities in the merger; provided, however, that, in each of the cases set
forth above in clauses (c)(i) or (c)(ii), no Change of Control shall be
deemed to take place if the transaction was approved by the Board of Directors,
the majority of the members of which were in place prior to the commencement of
such sale, merger or consolidation; or  (d)  The date of approval by the shareholders of
the Company of the liquidation of the Company or the sale or other disposition
of all or substantially all of the assets of the Company.  8.
 TERMINATION OF DIRECTORSHIP. Except as
otherwise provided in this Section 8, or as otherwise provided by the
Committee and evidenced in an Option agreement, no person may exercise a vested
Option more than three months after the first date on which he or she ceases to
be a director of the Company. If a participant ceases to


be
a director of the Company by reason of death or disability, any vested Options
held by him or her may be exercised within 12 months after the date he or she
ceases to be a director of the Company. In no event may an Option be exercised
after the expiration of the term of such Option.  9.  PAYMENT. Full payment of the purchase price
for shares of Common Stock purchased upon the exercise, in whole or in part, of
an Option granted under the Plan shall be made at the time of such exercise.
The Option Price may be paid in cash, in shares of Common Stock valued at their
fair market value on the date of exercise or with any other form of
compensation permissible for such purposes under Delaware law, as determined by
the Committee in its judgment. Alternatively, an Option may be exercised in
whole or in part by delivering a properly executed exercise notice together
with irrevocable instructions to a broker to deliver promptly to the Company
the amount of sale or loan proceeds necessary to pay the Option Price, and such
other documents as the Committee may determine.  No
shares of Common Stock shall be issued or transferred to a participant until
full payment therefor has been made, and a participant shall have none of the
rights of a stockholder until shares are issued or transferred to him or her.  10.  NONTRANSFERABILITY. Options granted under the
Plan shall not be transferable other than by will or by the laws of descent and
distribution, and, during a participants lifetime, shall be exercisable only
by him or her. Notwithstanding the foregoing, a participant may transfer any
Option granted under the Plan to the participants spouse, children,
grandchildren, parents, and/or siblings or to one or more trusts for the
benefit of such family members, if the agreement evidencing such Option so
provides and the participant does not receive any consideration for the
transfer. Any Option so transferred shall continue to be subject to the same
terms and conditions that applied to such Option immediately prior to its
transfer (except that such transferred Option shall not be further transferable
by the transferee during the transferees lifetime).  11.  ISSUANCE OF SHARES. If a participant so
requests, shares purchased upon the exercise of an Option may be issued or
transferred in the name of the participant and another person jointly with the
right of survivorship.  12.  STATUS OF OPTIONS. Options granted under the
Plan are nonqualified options not qualifying as incentive stock options under Section 422
of the Internal Revenue Code of 1986, as amended.  13.  CHANGES IN CAPITAL STRUCTURE, ETC. In the
event of any merger, share exchange, reorganization, consolidation,
recapitalization, reclassification, distribution, stock dividend, stock split,
reverse stock split, split-up, spin-off, or other similar transaction or event
affecting the Common Stock, the Committee is authorized, to the extent it deems
appropriate, to make substitutions or adjustments in the aggregate number and
kind of shares of Common Stock reserved for issuance under the Plan, in the
number, kind and price of shares of Common Stock subject to outstanding awards,
and in the


award
limits under the Plan (or to make provision for cash payment to the holder of
an Option). Outstanding Options shall be appropriately amended as to price and
other terms in a manner consistent with the aforementioned adjustment to the
shares of Common Stock subject to the Plan. Fractional shares resulting from
any adjustment in Options pursuant to this Section 13 may be settled in
cash or otherwise as the Committee shall determine. Notice of any adjustment shall
be given by the Company to each holder of an Option which shall have been
adjusted and such adjustment (whether or not such notice is given) shall be
effective and binding for all purposes of this Plan.  14.  EFFECTIVE DATE AND TERMINATION OF PLAN. The
Plan shall become effective on the date of its adoption by the Board or a duly
authorized committee thereof, subject to the approval of the Plan by the
Companys stockholders at the 2009 Annual Meeting. The Plan shall terminate 10
years from the date of its adoption or such earlier date as the Board or such
committee may determine. Any Option outstanding under the Plan at the time of
its termination shall remain in effect in accordance with its terms and
conditions and those of the Plan.  15.  AMENDMENT. The Board or a duly authorized
committee thereof may amend the Plan in any respect from time to time;
provided, however, that no amendment shall become effective unless approved by
affirmative vote of the Companys shareholders if such approval is necessary or
desirable for the continued validity of the Plan or if the failure to obtain
such approval would adversely affect the compliance of the Plan with Rule 16b-3
or any successor rule under the Securities Exchange Act of 1934, as
amended, or any other rule or regulation. No amendment may, without the
consent of a participant, impair his or her rights under any Option previously
granted under the Plan.  The
Board or a duly authorized committee thereof shall have the power, in the event
of any disposition of substantially all of the assets of the Company, its
dissolution, any merger or consolidation of the Company with or into any other
corporation, or the merger or consolidation of any corporation into the
Company, to amend all outstanding Options to terminate such Options as of such
effectiveness. If the Board shall exercise such power, all Options then
outstanding shall be deemed to terminate upon such effectiveness.  16.  LEGAL AND REGULATORY REQUIREMENTS. No Option
shall be exercisable and no shares will be delivered under the Plan except in
compliance with all applicable federal and state laws and regulations
including, without limitation, compliance with the rules of all domestic
stock exchanges on which the Common Stock may be listed. Any share certificate
issued to evidence shares for which an Option is exercised may bear such
legends and statements as the Committee shall deem advisable to assure
compliance with federal and state laws and regulations. No Option shall be
exercisable, and no shares will be delivered under the Plan, until the Company
has obtained consent or approval from regulatory bodies, federal or state,
having jurisdiction over such matters as the Committee may deem advisable.


In
the case of the exercise of an Option by a person or estate acquiring the right
to exercise the Option by bequest or inheritance, the Committee may require
reasonable evidence as to the ownership of the Option and may require consents
and releases of taxing authorities that it may deem advisable.