EXHIBIT
      10.23

     

    STOCK
      OPTION AGREEMENT

    AND

    NOTICE
      OF GRANT

    


    Date
      of
      Grant: January 1, 2008

     

    Richard
      E. Otto

    15
      Fairway Drive

    St.
      Simons Island, Georgia 31522

    


    Dear
      Richard:

     

    In
      recognition of your service to Scivanta Medical Corporation (“Scivanta”) and to
      encourage you to continue to take into account the long-term interests of
      Scivanta, the Board of Directors of Scivanta (the “Board”) has authorized the
      grant to you of an option (the “Option”) to purchase twenty-seven thousand
      (27,000) shares (the “Shares”) of Scivanta’s common stock, par value $.001 per
      share (“Common Stock”), under the Scivanta Medical Corporation 2007 Equity
      Incentive Plan (the “Equity Incentive Plan”).

     

    1. Equity
      Incentive Plan.

     

    The
      Option is a Nonqualified Option and subject to each and every provision of
      the
      Equity Incentive Plan which are incorporated by reference herein, as well as
      the
      terms and provisions set forth in this Stock Option Agreement and Notice of
      Grant (this “Stock Option Agreement”). The Equity Incentive Plan shall govern
      and be conclusive as to all matters not expressly provided for in this Stock
      Option Agreement. In the event of any conflict between the terms of this Stock
      Option Agreement and the Equity Incentive Plan, the terms of this Stock Option
      Agreement shall govern. All capitalized terms contained herein which are not
      otherwise defined herein shall have the meanings ascribed to them in the Equity
      Incentive Plan. By accepting the Option you agree to be bound by the provisions
      of the Equity Incentive Plan and this Stock Option Agreement. A copy of the
      Equity Incentive Plan has been previously provided to you.

     

    2. Exercise
      Price and Procedure.

     

    The
      per
      share exercise price of the Option is $0.14 (the “Option Price”), which is equal
      to the closing price of Scivanta’s Common Stock on December 31, 2007. The Option
      Price may be adjusted as provided for in the Equity Incentive Plan. Full payment
      shall be made for any Shares to be purchased under the Option at the time of
      exercise of the Option. Payment for the Shares to be purchased upon the exercise
      of the Option shall be made by personal check or in cash in an amount equal
      to
      the aggregate Option Price. Alternatively, payment for the Shares to be
      purchased upon the exercise of the Option may be made by (a) delivery of a
      number of shares of Common Stock owned by you which have an aggregate Fair
      Market Value equal to or greater than the aggregate Option Price, or (b)
      instructing Scivanta to withhold from the Shares deliverable upon exercise
      of
      the Option that number of Shares which have an aggregate Fair Market Value
      equal
      to or greater than the aggregate Option Price. The portion of any payment in
      the
      form of Common Stock which exceeds the aggregate Option Price, will be returned
      to you in the form of a cash payment.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Subject
      to the terms of this Stock Option Agreement and the Equity Incentive Plan,
      the
      Option shall become exercisable on the date or dates, and subject to such
      conditions, as are set forth herein. To the extent that a portion of the Option
      is or becomes exercisable and is not exercised, such portion shall accumulate
      and be exercisable by you in whole or in part at any time prior to expiration
      of
      the Option, subject to the terms of this Stock Option Agreement and the Equity
      Incentive Plan. You expressly acknowledge that the Option may vest and be
      exercisable only upon such terms and conditions as are provided in this Stock
      Option Agreement and the Equity Incentive Plan. 

     

    To
      exercise all or any portion of the Option, you must provide to Scivanta (a)
      written notice of such exercise, which is to include the number of Shares of
      Scivanta’s Common Stock to be purchased upon such exercise (the “Notice of
      Exercise”), and (b) payment of the aggregate Option Price as provided above. A
      form of Notice of Exercise is attached hereto. The Notice of Exercise is to
      be
      delivered to Scivanta at the following address:

     

    Scivanta
      Medical Corporation

    215
      Morris Avenue

    Spring
      Lake, New Jersey 07762

    Attn:
       Thomas S. Gifford

    Executive
      Vice President,

    Chief
      Financial Officer and Secretary

    


    Upon
      the
      exercise of the Option in whole or in part and payment of the aggregate Option
      Price in accordance with the provisions of this Stock Option Agreement, Scivanta
      shall, as soon thereafter as practicable, deliver to you a certificate or
      certificates for the Shares purchased. 

     

    3. Term
      and Vesting of Options.

     

    The
      date
      of grant of the Option is January 1, 2008 and the Option shall expire on and
      may
      not be exercised after January 1, 2013 (the “Term”), unless such Term is reduced
      or extended as provided for herein or in the Equity Incentive Plan.

     

    The
      Shares of Common Stock underlying the Option vest as follows: 6,750 Shares
      vest
      on March 31, 2008; 6,750 Shares vest on June 30, 2008; 6,750 Shares vest on
      September 30, 2008; and 6,750 share vest on December 31, 2008.

     

    Unless
      the Board determines otherwise, upon your termination as a member of the Board
      for any reason whatsoever, including death and Disability, your right to
      purchase any Shares underlying the Option which have not vested shall terminate
      and be of no further effect. Any Shares of Common Stock underlying the Option
      which have vested at the time you cease to be a member of the Board, for any
      reason other than death, shall remain subject to purchase through the remainder
      of the Term.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    Upon
      your
      death, all vested Shares of Common Stock underlying the Option may be purchased
      by the administrator of your estate for a period of one year following your
      death. Your right to purchase any vested Shares of Common Stock available for
      purchase under the Option which have not been purchased within one year from
      the
      date of your death, shall automatically terminate on the one year anniversary
      of
      your death and be of no further effect. In the event of a Change in Control
      of
      Scivanta, the Option becomes fully vested as of ten days prior to the Change
      in
      Control. 

     

    4. Miscellaneous.

     

    4.01. Nonqualified
      Option.
      The
      Option is not qualified for favorable tax treatment under Sections 422 or 423
      of
      the Internal Revenue Code of 1986, as amended (the “Code”). Scivanta recommends
      that you consult with your tax advisor regarding the tax consequences related
      to
      the Option.

     

    4.02. Restrictions
      on Transferability of the Option and Shares.
      The
      Option is not transferable by you except by will or the laws of descent and
      distribution. The Shares to be acquired by you pursuant to the exercise of
      the
      Option have not been registered under the Securities Act of 1933, as amended,
      or
      any state securities act or law, and, as a result, are subject to certain
      restrictions on transfer thereunder.

     

    4.03. Withholding.
      As a
      condition to the issuance of Shares upon the exercise of the Option, Scivanta
      can require you to remit to it the amount which Scivanta has determined must
      be
      withheld in respect of federal or state income attributable to any taxable
      income to be recognized by you in connection with the exercise of the
      Option.

     

    4.04. No
      Right of Service.
      No
      provision of this Stock Option Agreement or of the Equity Incentive Plan shall
      give you any right to continue as a member of the board of directors of Scivanta
      or interfere with the right of Scivanta to terminate your service as a director
      at any time in accordance with Scivanta’s Bylaws and applicable
      law.

     

    4.05. Governing
      Law and Jurisdiction.
      The
      Equity Incentive Plan and this Stock Option Agreement shall be construed and
      their respective provisions enforced and administered in accordance with the
      laws of the State of Nevada.

     

    4.06. Compliance
      with Code Section 409A.
      Notwithstanding any other provision in this Stock Option Agreement or the Equity
      Incentive Plan to the contrary, if and to the extent that Section 409A (“Section
      409A”) of the Code is deemed to apply to the Equity Incentive Plan, this Stock
      Option Agreement or the Option granted hereby, it is the general intention
      of
      Scivanta that the Equity Incentive Plan, this Stock Option Agreement and the
      Option shall comply with Section 409A, related regulations or other guidance,
      and the Equity Incentive Plan, this Stock Option Agreement and the Option shall,
      to the extent practicable, be construed in accordance therewith. 

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    If
      you
      wish to accept the Option granted hereby pursuant to the terms set forth herein,
      please signify your acceptance by countersigning this Stock Option Agreement
      below where designated. Any comments or questions should be directed to Thomas
      S. Gifford, Executive Vice President, Chief Financial Officer and Secretary
      at
      Scivanta Medical Corporation, 215 Morris Avenue, Spring Lake, New Jersey 07762.
      The phone number of Scivanta is (732) 282-1620.

     

    
      	 	Very
              truly yours,
	 	 
	 	Scivanta
              Medical Corporation
	 	 
	 	By: 	/s/
              David R. LaVance
	 	Name:
               David R. LaVance
	 	Title:
                 President and Chief Executive Officer
	 	 
	
              By
                the execution hereof, I accept the grant of Option provided for herein
                and
                agree to be bound by the terms and provisions set forth in this Stock
                Option Agreement and the Equity Incentive Plan.

            	 


    

     

    
      	/s/
              Richard E. Otto	 	 
	Richard
              E. Otto 	 	 


    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    NOTICE
      OF EXERCISE

     

    Date:
      _______ __, 20__

     

    Scivanta
      Medical Corporation

    215
      Morris Avenue

    Spring
      Lake, New Jersey 07762

    Attention:
      Thomas S. Gifford, Executive Vice President, Chief Financial Officer and
      Secretary

     

    Dear
      Mr.
      Gifford:

     

    I
      hereby
      exercise the non-qualified stock option (the “Option”) granted to me on January
      1, 2008 for the purchase of ________ shares (the “Shares”) of common stock, par
      value $.001 per share (“Common Stock”), of Scivanta Medical Corporation
      (“Scivanta”). I was granted the Option under the Scivanta Medical Corporation
      2007 Equity Incentive Plan (the “Equity Incentive Plan”). The per share exercise
      price is $0.14 (the “Option Price”) and the aggregate Option Price for the
      Shares being purchased is $___________. 

     

    Please
      check the box next to the applicable payment provision:

    

      
        	
                o

                 

              	
                As
                  full payment for the Shares being purchased, enclosed with this
                  Notice of
                  Exercise is a personal check or cash in the amount of the aggregate
                  Option
                  Price of $___________. (Checks
                  should be made payable to “Scivanta Medical Corporation”.)
                  

              
	 	 
	
                o

                 

              	
                I
                  wish to pay for the Shares being purchased by delivering to Scivanta
                  that
                  number of Shares of Common Stock which have an aggregate Fair Market
                  Value
                  (as defined in the Equity Incentive Plan) equal to or greater than
                  the
                  aggregate Option Price.

              
	 	 
	
                o

                 

              	
                I
                  wish to pay for the Shares being purchased by having Scivanta withhold
                  therefrom the number of Shares of Common Stock which have an aggregate
                  Fair Market Value equal to or greater than the aggregate Option
                  Price.

              


      

    

    
       

    

    I
      agree
      hereby that Scivanta is not required to issue me the Shares to be purchased
      pursuant to my exercise of the Option as provided for in this Notice of
      Exercise, until I have remitted to Scivanta the aggregate amount of any
      applicable withholding taxes which Scivanta has notified me shall be withheld
      in
      connection with the exercise of the Option.

     

    I
      hereby
      understand that the Shares to be acquired by me pursuant to the exercise of
      the
      Option have not been registered under the Securities Act of 1933, as amended,
      or
      any state securities act or law, and, as a result, are subject to certain
      restrictions on transfer thereunder.

     

    
      	 	 
	
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