EXHIBIT
        10.3

    

    


    EUGENE
      SCIENCE, INC.

     

    STOCK
      OPTION AGREEMENT

    UNDER

    2006
      STOCK INCENTIVE PLAN

    


    Type
      of Option (check one):    o 
      Incentive     o 
      Nonqualified

     

    This
      Stock Option Agreement (the “Agreement”) is entered into as of __________,
      _____, by and between EUGENE SCIENCE, INC., a Delaware corporation (the
“Company”),
      and
      _______________ (“Optionee”)
      pursuant to the Company’s 2006 Stock Incentive Plan (the “Plan”).  Any
      capitalized term not defined herein shall have the meaning ascribed to it in
      the
      Plan.

     

    1.    Grant
      of Option.
      The
      Company hereby grants to Optionee an option (the “Option”)
      to
      purchase all or any portion of a total of ______________________ (_______)
      shares (the “Shares”)
      of the
      Common Stock of the Company at a purchase price of _____________ ($_____) per
      share (the “Exercise
      Price”),
      subject to the terms and conditions set forth herein and the provisions of
      the
      Plan. If the box marked “Incentive” above is checked, then this Option is
      intended to qualify as an “incentive stock option” as defined in Section 422 of
      the Internal Revenue Code of l986, as amended (the “Code”).
      If
      this Option fails in whole or in part to qualify as an incentive stock option,
      or if the box marked “Nonqualified” is checked, then this Option shall to that
      extent constitute a nonqualified stock option.

     

    2.    Vesting
      of Option.
      The
      right to exercise this Option shall vest in installments, and this Option shall
      be exercisable from time to time in whole or in part as to any vested
      installment (“Vested
      Shares”).
      ____________ percent (__%) of the Shares shall become Vested Shares on the
      first
      anniversary of the date hereof and thereafter, the balance of the Shares shall
      become Vested Shares in a series of ___________ (__) successive equal monthly
      installments for each month of Continuous Service provided by the Optionee,
      such
      that 100% of the Shares shall become Vested Shares on the ________ (___)
      anniversary of the date hereof. 

     

    3.    Term
      of Option.
      Optionee’s right to exercise this Option shall terminate upon the first to occur
      of the following:

     

    (a)    the
      expiration of ten (10) years from the date of this Agreement;

     

    (b)    the
      expiration of one (1) year from the date of termination of Optionee’s Continuous
      Service if such termination is due to Optionee’s death or if death occurs during
      either the three-month or one-month period following termination of Optionee’s
      Continuous Service pursuant to Section 3(d) or 3(e) below, as the case may
      be;

     

    (c)    the
      expiration of three (3) months from the date of termination of Optionee’s
      Continuous Service if such termination occurs for any reason other than
      permanent disability, death, voluntary resignation or cause; provided, however,
      that if Optionee dies during such three-month period the provisions of
      Section 3(c) above shall apply;

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (d)    the
      expiration of one (1) month from the date of termination of Optionee’s
      Continuous Service if such termination occurs due to voluntary resignation;
      provided, however, that if Optionee dies during such one-month period the
      provisions of Section 3(c) above shall apply; 

     

    (e)    the
      termination of Optionee’s Continuous Service, if such termination is for Cause
      (as defined below in Section 9(d)); or

     

    (f)    upon
      the
      consummation of a Change in Control (as defined in Section 2.5 of the
      Plan), unless otherwise provided pursuant to Section 11 below.

     

    As
      used
      herein, the term “Continuous
      Service”
means
      (i) employment by either the Company or any parent or subsidiary corporation
      of
      the Company, or by a corporation or a parent or subsidiary of a corporation
      issuing or assuming a stock option in a transaction to which Section 424(a)
      of
      the Code applies, which is uninterrupted except for vacations, illness (except
      for permanent disability, as defined in Section 22(e)(3) of the Code), or leaves
      of absence which are approved in writing by the Company or any of such other
      employer corporations, if applicable, or (ii) service as a member of the Board
      of Directors of the Company until Optionee resigns, is removed from office,
      or
      Optionee’s term of office expires and he or she is not reelected. The Optionee’s
      Continuous Service shall not terminate merely because of a change in the
      capacity in which the Optionee renders service to the Company or a corporation
      or subsidiary corporation described in clause (i) above. For example, a change
      in the Optionee’s status from an employee to a Non-Employee Director will not
      constitute an interruption of the Optionee’s Continuous Service, provided there
      is no interruption in the Optionee’s performance of such services.

     

    4.    Exercise
      of Option.
      On or
      after the vesting of any portion of this Option in accordance with Sections
      2 or
      9 hereof, and until termination of the right to exercise this Option in
      accordance with Section 3 above, the portion of this Option which has vested
      may
      be exercised in whole or in part by the Optionee (or, after his or her death,
      by
      the person designated in Section 5 below) upon delivery of the following to
      the
      Company at its principal executive offices:

     

    (a)    a
      written
      notice of exercise which identifies this Agreement and states the number of
      Shares then being purchased (but no fractional Shares may be purchased) unless
      the Company has established other procedures;

     

    (b)    a
      check
      or cash in the amount of the Exercise Price (or payment of the Exercise Price
      in
      such other form of lawful consideration as the Administrator may approve from
      time to time under the provisions of Section 5.3 of the Plan);

     

    (c)    a
      check
      or cash in the amount reasonably requested by the Company to satisfy the
      Company’s withholding obligations under federal, state or other applicable tax
      laws with respect to the taxable income, if any, recognized by the Optionee
      in
      connection with the exercise of this Option (unless the Company and Optionee
      shall have made other arrangements for deductions or withholding from Optionee’s
      wages, bonus or other compensation payable to Optionee, or by the withholding
      of
      Shares issuable upon exercise of this Option or the delivery of Shares owned
      by
      the Optionee in accordance with Section 14.5 of the Plan, provided such
      arrangements satisfy the requirements of applicable tax laws); and

     

    
      
         

      

      
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    (d)    a
      letter,
      if requested by the Company, in such form and substance as the Company may
      require, setting forth the investment intent of the Optionee, or person
      designated in Section 5 below, as the case may be.

     

    5.    Death
      of Optionee; No Assignment.
      The
      rights of the Optionee under this Agreement may not be assigned or transferred
      except by will or by the laws of descent and distribution, and may be exercised
      during the lifetime of the Optionee only by such Optionee. Any attempt to sell,
      pledge, assign, hypothecate, transfer or dispose of this Option in contravention
      of this Agreement or the Plan shall be void and shall have no effect. If the
      Optionee’s Continuous Service terminates as a result of his or her death, and
      provided Optionee’s rights hereunder shall have vested pursuant to Section 2
      hereof, Optionee’s legal representative, his or her legatee, or the person who
      acquired the right to exercise this Option by reason of the death of the
      Optionee (individually, a “Successor”)
      shall
      succeed to the Optionee’s rights and obligations under this Agreement. After the
      death of the Optionee, only a Successor may exercise this Option.

     

    6.    Representations
      and Warranties of Optionee.
      Optionee acknowledges receipt of a copy of the Plan and understands that all
      rights and obligations connected with this Option are set forth in this
      Agreement and in the Plan.

     

    7.    Limitation
      on Company’s Liability for Nonissuance.
      The
      Company agrees to use its reasonable best efforts to obtain from any applicable
      regulatory agency such authority or approval as may be required in order to
      issue and sell the Shares to the Optionee pursuant to this Option. Inability
      of
      the Company to obtain, from any such regulatory agency, authority or approval
      deemed by the Company’s counsel to be necessary for the lawful issuance and sale
      of the Shares hereunder and under the Plan shall relieve the Company of any
      liability in respect of the nonissuance or sale of such Shares as to which
      such
      requisite authority or approval shall not have been obtained.

     

    8.    Adjustments
      Upon Changes in Capital Structure.
      In the
      event that the outstanding shares of Common Stock of the Company are hereafter
      increased or decreased or changed into or exchanged for a different number
      or
      kind of shares or other securities of the Company by reason of a
      recapitalization, stock split, combination of shares, reclassification, stock
      dividend or other change in the capital structure of the Company, then
      appropriate adjustment shall be made by the Administrator to the number of
      Shares subject to the unexercised portion of this Option and to the Exercise
      Price per share, in order to preserve, as nearly as practical, but not to
      increase, the benefits of the Optionee under this Option, in accordance with
      the
      provisions of Section 4.3 of the Plan.

     

    9.    Change
      in Control.
      In the
      event of a Change in Control of the Company (as defined in Section 2.4 of the
      Plan): 

     

    (a)    The
      right
      to exercise this Option shall accelerate automatically and vest in full
      (notwithstanding the provisions of Section 2 above) effective as of immediately
      prior to the consummation of the Change in Control unless
      this
      Option is to be assumed by the acquiring or successor entity (or parent thereof)
      or a new option or New Incentives are to be issued in exchange therefor, as
      provided in subsection (b) below. If vesting of this Option will accelerate
      pursuant to the preceding sentence, the Administrator in its discretion may
      provide, in connection with the Change in Control transaction, for the purchase
      or exchange of this Option for an amount of cash or other property having a
      value equal to the difference (or “spread”) between: (x) the value of the
      cash or other property that the Optionee would have received pursuant to the
      Change in Control transaction in exchange for the Shares issuable upon exercise
      of this Option had this Option been exercised immediately prior to the Change
      in
      Control, and (y) the aggregate Exercise Price for such Shares. If the vesting
      of
      this Option will accelerate pursuant to this subsection (a), then the
      Administrator shall cause written notice of the Change in Control transaction
      to
      be given to the Optionee not less than fifteen (15) days prior to the
      anticipated effective date of the proposed transaction.

     

    
      
         

      

      
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    (b)    The
      vesting of this Option shall
      not
      accelerate if and to the extent that: (i) this Option (including the
      unvested portion thereof) is to be assumed by the acquiring or successor entity
      (or parent thereof) or a new option of comparable value is to be issued in
      exchange therefor pursuant to the terms of the Change in Control transaction,
      or
      (ii) this Option (including the unvested portion thereof) is to be replaced
      by the acquiring or successor entity (or parent thereof) with other incentives
      of comparable value under a new incentive program (“New
      Incentives”)
      containing such terms and provisions as the Administrator in its discretion
      may
      consider equitable. If this Option is assumed, or if a new option of comparable
      value is issued in exchange therefor, then this Option or the new option shall
      be appropriately adjusted, concurrently with the Change in Control, to apply
      to
      the number and class of securities or other property that the Optionee would
      have received pursuant to the Change in Control transaction in exchange for
      the
      Shares issuable upon exercise of this Option had this Option been exercised
      immediately prior to the Change in Control, and appropriate adjustment also
      shall be made to the Exercise Price such that the aggregate Exercise Price
      of
      this Option or the new option shall remain the same as nearly as
      practicable.

     

    (c)    If
      the
      provisions of subsection (b) above apply, then this Option, the new option
      or
      the New Incentives shall continue to vest in accordance with the provisions
      of
      Section 2 hereof and shall continue in effect for the remainder of the term
      of
      this Option in accordance with the provisions of Section 3 hereof. However,
      in
      the event of an Involuntary Termination (as defined below) of Optionee’s
      Continuous Service within twelve (12) months following such Change in Control,
      then vesting of this Option, the new option or the New Incentives shall
      accelerate in full automatically effective upon such Involuntary
      Termination.

     

    (d)    For
      purposes of this Section 11, the following terms shall have the meanings set
      forth below:

     

    (i)    “Involuntary
      Termination”
shall
      mean the termination of Optionee’s Continuous Service by reason of:

     

    (A)    Optionee’s
      involuntary dismissal or discharge by the Company, or by the acquiring or
      successor entity (or parent or any subsidiary thereof employing the Optionee)
      for reasons other than Cause (as defined below), or 

     

    (B)    Optionee’s
      voluntary resignation following (x) a change in Optionee’s position with the
      Company, the acquiring or successor entity (or parent or any subsidiary thereof)
      which materially reduces Optionee’s duties and responsibilities or the level of
      management to which Optionee reports, (y) a reduction in Optionee’s level of
      compensation (including base salary, fringe benefits and target bonus under
      any
      performance based bonus or incentive programs) by more than ten percent (10%),
      or (z) a relocation of Optionee’s principal place of employment by more than
      thirty (30) miles, provided and only if such change, reduction or relocation
      is
      effected without Optionee’s written consent.

     

    
      
         

      

      
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    (ii)    “Cause”
shall
      mean (A) the commission of any act of fraud, embezzlement or dishonesty by
      Optionee which materially and adversely affects the business of the Company,
      the
      acquiring or successor entity (or parent or any subsidiary thereof), (B) any
      unauthorized use or disclosure by Optionee of confidential information or trade
      secrets of the Company, the acquiring or successor entity (or parent or any
      subsidiary thereof), (C) the continued refusal or omission by the Optionee
      to
      perform any material duties required of him if such duties are consistent with
      duties customary for the position held with the Company, the acquiring or
      successor entity (or parent or any subsidiary thereof), (D) any material act
      or
      omission by the Optionee involving malfeasance or gross negligence in the
      performance of Optionee’s duties to, or material deviation from any of the
      policies or directives of, the Company or the acquiring or successor entity
      (or
      parent or any subsidiary thereof), (E) conduct on the part of Optionee which
      constitutes the breach of any statutory or common law duty of loyalty to the
      Company, the acquiring or successor entity (or parent or any subsidiary
      thereof), (F) the maintenance of any proceeding initiated by or against Optionee
      under any bankruptcy or debtors’ relief laws of the United States or of any
      other jurisdiction, which proceeding is not terminated within ninety (90) days
      after its commencement, or (G) any illegal act by Optionee which materially
      and
      adversely affects the business of the Company, the acquiring or successor entity
      (or parent or any subsidiary thereof), or any felony committed by Optionee,
      as
      evidenced by conviction thereof. The provisions of this Section shall not limit
      the grounds for the dismissal or discharge of Optionee or any other individual
      in the service of the Company, the acquiring or successor entity (or parent
      or
      any subsidiary thereof).

     

    10.    No
      Employment Contract Created.
      Neither
      the granting of this Option nor the exercise hereof shall be construed as
      granting to the Optionee any right with respect to continuance of employment
      by,
      or other service provider relationship with, the Company or any of its
      subsidiaries. The right of the Company or any of its subsidiaries to terminate
      at will the Optionee’s employment at any time (whether by dismissal, discharge
      or otherwise), with or without cause, is specifically reserved.

     

    11.    Rights
      as Shareholder.
      The
      Optionee (or transferee of this option by will or by the laws of descent and
      distribution) shall have no rights as a shareholder with respect to any Shares
      covered by this Option until the date of the issuance of a stock certificate
      or
      certificates to him or her for such Shares, notwithstanding the exercise of
      this
      Option.

     

    12.    “Market
      Stand-Off” Agreement.
      Optionee agrees that, if requested by the Company or the managing underwriter
      of
      any proposed public offering of the Company’s securities (including any
      acquisition transaction where Company securities will be used as all or part
      of
      the purchase price), Optionee will not sell or otherwise transfer or dispose
      of
      any Shares held by Optionee without the prior written consent of the Company
      or
      such underwriter, as the case may be, during such period of time, not to exceed
      180 days following the effective date of the registration statement filed by
      the
      Company with respect to such offering, as the Company or the underwriter may
      specify.

     

    13.    Interpretation.
      This
      Option is granted pursuant to the terms of the Plan, and shall in all respects
      be interpreted in accordance therewith. The Administrator shall interpret and
      construe this Option and the Plan, and any action, decision, interpretation
      or
      determination made in good faith by the Administrator shall be final and binding
      on the Company and the Optionee. As used in this Agreement, the term
“Administrator”
shall
      refer to the committee of the Board of Directors of the Company appointed to
      administer the Plan, and if no such committee has been appointed, the term
      Administrator shall mean the Board of Directors.

     

    
      
         

      

      
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    14.    Notices.
      Any
      notice, demand or request required or permitted to be given under this Agreement
      shall be in writing and shall be deemed given when delivered personally or
      three
      (3) days after being deposited in the United States mail, as certified or
      registered mail, with postage prepaid, and addressed, if to the Company, at
      its
      principal place of business, Attention: the Chief Financial Officer, and if
      to
      the Optionee, at his or her most recent address as shown in the employment
      or
      stock records of the Company.

     

    15.    Applicable
      Law.
      This
      Agreement shall be construed in accordance with the laws of the State of
      California without reference to choice of law principles, as to all matters,
      including, but not limited to, matters of validity, construction, effect or
      performance.

     

    16.    Severability.
      Should
      any provision or portion of this Agreement be held to be unenforceable or
      invalid for any reason, the remaining provisions and portions of this Agreement
      shall be unaffected by such holding.

     

    17.    Counterparts.
      This
      Agreement may be executed in two or more counterparts, each of which shall
      be
      deemed an original and all of which together shall be deemed one
      instrument.

     

     

    [Signature
      Page Follows]

     

    
      
         

      

      
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    IN
      WITNESS WHEREOF, the parties have executed this Agreement as of the date first
      above written.

     

    
      
        	
                EUGENE
                  SCIENCE, INC.

              	
                “OPTIONEE”

              
	
                 

                By:
                  _______________________________________

              	
                 

                _______________________________________

                (Signature)

              
	
                 

                Its:
                  _______________________________________      

              	
                 

                _______________________________________

                (Type
                  or Print Name)

              


      

      
 

      
        
           

        

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