Exhibit 10.2

 

GEMPHIRE THERAPEUTICS INC.

INDUCEMENT PLAN

 

OPTION GRANT NOTICE

 

Gemphire Therapeutics Inc. (the “Company”), pursuant to its Inducement Plan (the “Plan”), hereby grants to Optionholder an option to purchase the number of shares of the Company’s Common Stock set forth below. This option is subject to all of the terms and conditions as set forth herein and in the Option Agreement, the Plan, and the Notice of Exercise, all of which are attached hereto and incorporated herein in their entirety.

 


	
 
    	
Optionholder:
    	
 
    
	
 
    	
Date of Grant:
    	
 
    
	
 
    	
Vesting Commencement Date:
    	
 
    
	
 
    	
Number of Shares Subject to Option:
    	
 
    
	
 
    	
Exercise Price (Per Share):
    	
$
    
	
 
    	
Total Exercise Price:
    	
$
    
	
 
    	
Expiration Date:
    	
 
    




 


	
Type of   Grant:
    	
Nonstatutory Stock Option
    
	
 
    	
 
    
	
Vesting   Schedule:
    	
                of   the shares covered by the option will vest and become exercisable on                        (                        after the Vesting Commencement Date); the balance of the shares vest and   become exercisable in a series   of             successive   equal monthly installments measured from the first anniversary of the Vesting   Commencement Date provided your Continuous Service has not been terminated or   interrupted during the period preceding such vesting date.
    
	
 
    	
 
    
	
Exercise   Schedule:
    	
o       Same   as Vesting Schedule
    
	
 
    	
 
    
	
Payment:
    	
By one or a combination of the following items   (described in the Option Agreement):
    
	
 
    	
 
    
	
 
    	
o       By   cash or check
    
	
 
    	
o       Pursuant   to a Regulation T Program if the Shares are publicly traded
    
	
 
    	
o       By   delivery of already-owned shares if the Shares are publicly traded
    
	
 
    	
o       Subject   to the Company’s consent at the time of exercise, by a “net exercise”   arrangement
    




 

Additional Terms/Acknowledgements: The undersigned Optionholder acknowledges receipt of, and understands and agrees to, this Option Grant Notice, the Option Agreement, and the Plan. Optionholder further acknowledges that as of the Date of Grant, this Option Grant Notice, the Option Agreement, and the Plan set forth the entire understanding between Optionholder and the Company regarding the acquisition of stock in the Company and supersede all prior oral and written agreements on that subject with the exception of (i) options previously granted and delivered to Optionholder by the Company, and (ii) the following agreements only:

 

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OTHER AGREEMENTS:

 

	
GEMPHIRE   THERAPEUTICS INC.
    	
 
    	
OPTIONHOLDER:
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    
	
 
    	
Signature
    	
 
    	
Signature
    
	
Title:
    	
 
    	
Date:
    
	
Date:
    	
 
    	
 
    


 

ATTACHMENTS SENT OUT VIA E-MAIL: Option Agreement, Inducement Plan, and Notice of Exercise

 

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GEMPHIRE THERAPEUTICS INC.

INDUCEMENT PLAN

 

OPTION AGREEMENT

(NONSTATUTORY STOCK OPTION)

 

Pursuant to your Option Grant Notice (“Grant Notice”) and this Option Agreement, Gemphire Therapeutics Inc. (the “Company”) has granted you an option under its Inducement Plan (the “Plan”) to purchase the number of shares of the Company’s Common Stock indicated in your Grant Notice at the exercise price indicated in your Grant Notice. Defined terms not explicitly defined in this Option Agreement but defined in the Plan shall have the same definitions as in the Plan.

 

The details of your option are as follows:

 

1.                          VESTING. Subject to the limitations contained herein, your option will vest as provided in your Grant Notice, provided that vesting will cease upon the termination of your Continuous Service.

 

2.                          NUMBER OF SHARES AND EXERCISE PRICE. The number of shares of Common Stock subject to your option and your exercise price per share referenced in your Grant Notice may be adjusted from time to time for Capitalization Adjustments.

 

3.                          EXERCISE RESTRICTION FOR NON-EXEMPT EMPLOYEES. In the event that you are an Employee eligible for overtime compensation under the Fair Labor Standards Act of 1938, as amended (i.e., a “Non-Exempt Employee”), and except as otherwise provided in the Plan, you may not exercise your option until you have completed at least six (6) months of Continuous Service measured from the Date of Grant specified in your Grant Notice, notwithstanding any other provision of your option.

 

4.                          METHOD OF PAYMENT. Payment of the exercise price is due in full upon exercise of all or any part of your option. You may elect to make payment of the exercise price in cash or by check or in one or more of the following manners:

 

(a)         Provided that at the time of exercise the Common Stock is publicly traded, pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board that, prior to the issuance of Common Stock, results in either the receipt of cash (or check) by the Company or the receipt of irrevocable instructions to pay the aggregate exercise price to the Company from the sales proceeds.

 

(b)         Provided that at the time of exercise the Common Stock is publicly traded, by delivery to the Company (either by actual delivery or attestation) of already-owned shares of Common Stock that are owned free and clear of any liens, claims, encumbrances or security interests, and that are valued at Fair Market Value on the date of exercise. “Delivery” for these purposes, in the sole discretion of the Company at the time you exercise your option, shall include delivery to the Company of your attestation of ownership of such shares of Common Stock in a form approved by the Company. Notwithstanding the foregoing, you may not exercise your option by tender to the Company of Common Stock to the extent such tender would violate the provisions of any law, regulation or agreement restricting the redemption of the Company’s stock.

 

(c)          Subject to the consent of the Company at the time of exercise, by a “net exercise” arrangement pursuant to which the Company will reduce the number of shares of Common Stock issued upon exercise of your option by the largest whole number of shares with a Fair Market Value that does not exceed the aggregate exercise price; provided, however, that the Company shall accept a cash or other payment from you to the extent of any remaining balance of the aggregate exercise price not satisfied by such reduction in the number of whole shares to be issued; provided further, however, that shares of Common Stock will no longer be outstanding under your option and will not be exercisable thereafter to the extent that (1) shares are used to pay the exercise price pursuant to the “net exercise,” (2) shares are delivered to you as a result of such exercise, and (3) shares are withheld to satisfy tax withholding obligations.

 

5.                          WHOLE SHARES. You may exercise your option only for whole shares of Common Stock.

 

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6.                          SECURITIES LAW COMPLIANCE. Notwithstanding anything to the contrary contained herein, you may not exercise your option unless the shares of Common Stock issuable upon such exercise are then registered under the Securities Act or, if such shares of Common Stock are not then so registered, the Company has determined that such exercise and issuance would be exempt from the registration requirements of the Securities Act. The exercise of your option also must comply with other applicable laws and regulations governing your option, and you may not exercise your option if the Company determines that such exercise would not be in material compliance with such laws and regulations.

 

7.                          TERM. You may not exercise your option before the commencement or after the expiration of its term. The term of your option commences on the Date of Grant and expires, subject to the provisions of Section 5(g) of the Plan, upon the earliest of the following:

 

(a)         immediately upon the termination of your Continuous Service for Cause;

 

(b)         three months after the termination of your Continuous Service for any reason other than Cause, Disability or death, provided that if during any part of such three month period you may not exercise your option solely because of the condition set forth in the preceding paragraph relating to “Securities Law Compliance,” your option shall not expire until the earlier of the Expiration Date or until it shall have been exercisable for an aggregate period of three months after the termination of your Continuous Service; and if (i) you are a Non-Exempt Employee, (ii) your Continuous Service terminates within six months after the Date of Grant specified in your Grant Notice, and (iii) you have vested in a portion of your option at the time of your termination of Continuous Service, your option shall not expire until the earlier of (x) the later of (A) the date that is seven months after the Date of Grant specified in your Grant Notice or (B) the date that is three months after the termination of your Continuous Service, or (y) the Expiration Date;

 

(c)          12 months after the termination of your Continuous Service due to your Disability;

 

(d)         18 months after your death if you die during your Continuous Service;

 

(e)          the Expiration Date indicated in your Grant Notice; or

 

(f)           the day before the tenth anniversary of the Date of Grant.

 

Notwithstanding the foregoing, if you die during the period provided in Section 7(b) or 7(c) above, the term of your option shall not expire until the earlier of 18 months after your death, the Expiration Date indicated in your Grant Notice, or the day before the tenth anniversary of the Date of Grant.

 

8.                          EXERCISE.

 

(a)         You may exercise the vested portion of your option during its term by delivering a Notice of Exercise (in a form designated by the Company) together with the exercise price to the Secretary of the Company, or to such other person as the Company may designate, during regular business hours, together with such additional documents as the Company may then require.

 

(b)         By exercising your option you agree that, as a condition to any exercise of your option, the Company may require you to enter into an arrangement providing for the payment by you to the Company of any tax withholding obligation of the Company arising by reason of (i) the exercise of your option, (ii) the lapse of any substantial risk of forfeiture to which the shares of Common Stock are subject at the time of exercise, or (iii) the disposition of shares of Common Stock acquired upon such exercise.

 

9.                          TRANSFERABILITY. Your option is not transferable, except by will or by the laws of descent and distribution, and is exercisable during your life only by you. Notwithstanding the foregoing, by delivering written notice to the Company, in a form satisfactory to the Company, you may designate a third party who, in the event of your death, shall thereafter be entitled to exercise your option to the extent the option is exercisable at the time of your death. In addition, you may transfer your option to a trust if you are considered to be the sole beneficial owner (determined under Section 671 of the Code and applicable state law) while the option is held in the trust, provided that you and the trustee enter into transfer and other agreements required by the Company.

 

10.                   OPTION NOT A SERVICE CONTRACT. Your option is not an employment or service contract, and nothing in your option shall be deemed to create in any way whatsoever any obligation on your part to continue in the employ

 

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of the Company or an Affiliate, or of the Company or an Affiliate to continue your employment. In addition, nothing in your option shall obligate the Company or an Affiliate, their respective stockholders, Boards of Directors, Officers or Employees to continue any relationship that you might have as a Director or Consultant for the Company or an Affiliate.

 

11.                   WITHHOLDING OBLIGATIONS

 

(a)         At the time you exercise your option, in whole or in part, or at any time thereafter as requested by the Company, you hereby authorize withholding from payroll and any other amounts payable to you, and otherwise agree to make adequate provision for (including by means of a “cashless exercise” pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board to the extent permitted by the Company), any sums required to satisfy the federal, state, local and foreign tax withholding obligations of the Company or an Affiliate, if any, which arise in connection with the exercise of your option.

 

(b)         Upon your request and subject to approval by the Company, in its sole discretion, and compliance with any applicable legal conditions or restrictions, the Company may withhold from fully vested shares of Common Stock otherwise issuable to you upon the exercise of your option a number of whole shares of Common Stock having a Fair Market Value, determined by the Company as of the date of exercise, not in excess of the minimum amount required to be withheld by law (or such lower amount as may be necessary to avoid classification of your option as a liability for financial accounting purposes). Any adverse consequences to you arising in connection with such share withholding procedure shall be your sole responsibility.

 

(c)          You may not exercise your option unless the tax withholding obligations of the Company and/or any Affiliate are satisfied. Accordingly, you may not be able to exercise your option when desired even though your option is vested, and the Company shall have no obligation to issue a certificate for such shares of Common Stock or release such shares of Common Stock from any escrow provided for herein unless such obligations are satisfied.

 

12.                   TAX CONSEQUENCES. You hereby agree that the Company does not have a duty to design or administer the Plan or its other compensation programs in a manner that minimizes your tax liabilities. You shall not make any claim against the Company, or any of its Officers, Directors, Employees or Affiliates related to tax liabilities arising from your option or your other compensation. In particular, you acknowledge that this option is exempt from Section 409A of the Code only if the exercise price per share specified in the Grant Notice is at least equal to the “fair market value” per share of the Common Stock on the Date of Grant, there is no impermissible deferral of compensation associated with the option, and any other requirements for such exemption are satisfied.

 

13.                   NOTICES. Any notices provided for in your option or the Plan shall be given in writing and shall be deemed effectively given upon receipt or, in the case of notices delivered by mail by the Company to you, five (5) days after deposit in the United States mail, postage prepaid, addressed to you at the last address you provided to the Company.

 

14.                   GOVERNING PLAN DOCUMENT. Your option is subject to all the provisions of the Plan, the provisions of which are hereby made a part of your option, and is further subject to all interpretations, amendments, rules and regulations, which may from time to time be promulgated and adopted pursuant to the Plan. In the event of any conflict between the provisions of your option and those of the Plan, the provisions of the Plan shall control.

 

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Gemphire Therapeutics Inc.

[Address]

 

Date of Exercise:

 

Ladies and Gentlemen:

 

This constitutes notice under my stock option that I elect to purchase the number of shares for the price set forth below.

 

	
Type of option:
    	
 
    	
Nonstatutory
    
	
 
    	
 
    	
 
    
	
Stock option   dated:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Number of shares   as to which option is exercised:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Shares to be   issued in name of:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Total exercise   price:
    	
 
    	
$
    	
 
    
	
 
    	
 
    	
 
    
	
Cash payment   delivered herewith:
    	
 
    	
$
    	
 
    
	
 
    	
 
    	
 
    
	
Regulation T   Program (cashless exercise):
    	
 
    	
$
    	
 
    
	
 
    	
 
    	
 
    
	
Value of               shares   of Gemphire Therapeutics Inc. Common Stock delivered herewith(1):
    	
 
    	
$
    	
 
    
	
 
    	
 
    	
 
    
	
Value of               shares   of Gemphire Therapeutics Inc. Common Stock to be retained by Gemphire   Therapeutics Inc. pursuant to net exercise(2):
    	
 
    	
$
    	
 
    


 

By this exercise, I agree (i) to provide such additional documents as you may require pursuant to the terms of the Gemphire Therapeutics Inc. Inducement Plan and (ii) to provide for the payment by me to you (in the manner designated by you) of your withholding obligation, if any, relating to the exercise of this option.

 

 

	
 
    	
Very truly yours,
    


 




(1)         Shares must meet the public trading requirements set forth in the option. Shares must be valued on the date of exercise in accordance with the terms of the Plan and the option being exercised, and must be owned free and clear of any liens, claims, encumbrances or security interests. Certificates must be endorsed or accompanied by an executed assignment separate from certificate.

 

(2)         The Company must have established net exercise procedures at the time of exercise in order to utilize this payment method and must expressly consent to your use of net exercise at the time of exercise.

 

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