exv4w4



 





Exhibit 4.4




DIACRIN, INC.




NON-STATUTORY STOCK OPTION AGREEMENT




     1. Grant of Option. Diacrin, Inc., a Delaware corporation (the
“Company”), hereby grants to Dr. Joseph Avruch (the “Optionee”) an option to
purchase an aggregate of One Hundred Fifteen Thousand (115,000) shares of
Common Stock (“Common Stock”) of the Company at a price of $2.00 per share (the
“Option Price”), purchasable as set forth in and subject to the terms and
conditions of this Agreement.



     2. Non-Statutory Stock Option. This option is not intended to qualify as
an incentive stock option within the meaning of section 422 of the Internal
Revenue Code of 1986, as amended (the “Code”).



     3. Exercise of Option and Provisions for Termination. Subject to the
conditions set forth in this Agreement, this Option shall be exercised by the
Optionee’s delivery of written notice of exercise to the Treasurer of the
Company, specifying the number of shares to be purchased and the purchase price
to be paid therefor and accompanied by payment in full in accordance with
Section 4. Such exercise shall be effective upon receipt by the Treasurer of
the Company of such written notice together with the required payment. The
Optionee may purchase less than the number of shares covered hereby, provided
that no partial exercise of this option may be for any fractional share or for
fewer than ten whole shares. Except as otherwise provided in this Agreement,
this option may be exercised prior to the tenth anniversary of the date of
grant (the “Expiration Date”).



     4. Payment of Purchase Price. Payment of the Option Price for shares
purchased upon exercise of this option shall be made by delivery to the Company
of cash or a check to the order of the Company, or pursuant to an Option Price
Credit (as defined below), or a combination thereof, in an amount equal to the
Option Price of such shares. In the event that the Optionee renders consulting
services to the Company at the Company’s request, the Optionee may elect to
forego cash payment for such services and receive a credit against the payment
of the Option Price in the amount of $250 for each hour of consulting services
so rendered (the “Option Price Credit”). The Optionee shall notify the company
in writing prior to rendering any consulting services requested by the Company
as to whether he desires to receive an Option Price Credit in connection with
such services.



     5. Delivery of Shares; Compliance With Securities Laws, Etc.



               a. General. The Company shall, upon payment of the Option Price for the
number of shares purchased and paid for, make prompt delivery of such shares to
the Optionee, provided that if any law or regulation requires the Company to
take any action with respect to such shares before the issuance thereof, then
the date of delivery of such shares shall be extended for the period necessary
to complete such action.



               b. Listing, Qualification, Etc. This option shall be subject to the
requirement that if, at any time, counsel to the Company shall determine that
the listing, registration or qualification



 









 




of the shares subject hereto upon any securities exchange or under any
state or federal law, or the consent or approval of any governmental or
regulatory body, or that the disclosure of non-public information or the
satisfaction of any other condition is necessary as a condition of, or in
connection with, the issuance or purchase of shares hereunder, this option may
not be exercised, in whole or in part, unless such listing, registration,
qualification, consent or approval, disclosure or satisfaction of such other
condition shall have been effected or obtained on terms acceptable to the Board
of Directors of the Company, provided that the Expiration Date shall be
extended for the duration of the period, if any, between the receipt of
Optionee’s notice of exercise and the satisfaction by the Company of the
conditions referred to in this subsection. Nothing herein shall be deemed to
require the Company to apply f or, effect or obtain such listing, registration,
qualification or disclosure, or to satisfy such other condition, provided that
if the Common Stock, at the time of exercise of this option, is listed or
qualified on any securities exchange, the Company shall, to the extent
permissible by the rules of such exchange, include the shares issuable upon
exercise of this option in such listing or qualification. The Company agrees
to use its best efforts to include the shares of Common Stock issuable upon
exercise of this option in any registration statement on Form S-8 (or any
successor form thereto) filed under the Securities Act of 1933, as amended,
with respect to the company’s option plans, but only to the extent the Company
is permitted to include such shares on such Form under applicable Securities
and Exchange Commission rules and regulations, provided that nothing in this
sentence shall be construed to require the company to file any such
registration statement.




     6. Nontransferability of Option. This option is personal and no rights
granted hereunder may be transferred, assigned, pledged or hypothecated in any
way (whether by operation of law or otherwise) nor shall any such rights be
subject to execution, attachment or similar process, except that this option
may be transferred (i) by will or the laws of descent and distribution or (ii)
pursuant to a qualified domestic relations order as defined in Section 414(p)
of the Code. Upon any attempt to transfer, assign, pledge, hypothecate or
otherwise dispose of this option or of such rights contrary to the provisions
hereof, or upon the levy of any attachment or similar process upon this option
or such rights, this option and such rights shall, at the election of the
Company, become null and void.



     7. No Special Consulting or Similar Rights. Nothing contained in this
Agreement shall be construed or deemed by any person under any circumstances to
bind the Company to enter into or maintain any consulting or other relationship
with the Optionee for the period within which this option may be exercised.



     8. Rights as a Shareholder. The Optionee shall have no rights as a
shareholder with respect to any shares which may be purchased by exercise of
this option (including, without limitation, any rights to receive dividends or
non-cash distributions with respect to such shares) unless and until a
certificate representing such shares is duly issued and delivered to the
Optionee. No adjustment shall be made for dividends or other rights for which
the record date is prior to the date such stock certificate is issued.



     9. Restriction on Sales of Shares.



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               a. Definitions. As used herein, the following terms shall have the
following respective meanings:




          (1) Group shall mean (A) the Optionee, (B) the spouse, parents,
siblings and lineal descendants of the Optionee, (C) a trust for the
benefit of any of the foregoing and (D) any. distributee, legatee or
devisee of the Optionee, in each case who agrees in writing to be bound
by and comply with this Agreement to the same extent as the Optionee.




          (2) Sale/Sell, as to any Share, shall mean to sell, or in any other
way directly or indirectly transfer, assign, distribute, encumber or
otherwise dispose of, either voluntarily or involuntarily; provided,
however, that the Optionee shall not be deemed to Sell the Shares if such
Shares are transferred to a member of the Group of the Optionee and such
person agrees to be bound by the terms of this Agreement to the same
extent as the Optionee.




          (3) Selling Group shall mean the Group of the Optionee proposing to
Sell any of the Shares, or which has delivered a notice of intention to
Sell, pursuant to Section 9(c) hereof.




          (4) Shares shall mean all shares of Common Stock acquired by the
Optionee pursuant to this Agreement.



               b. Restriction on Sale. The Optionee hereby agrees that he shall not Sell
any Shares except to a member of the Group of the Optionee (provided such
member shall agree in writing in advance of any Sale of Shares hereunder that
such member shall be bound by and comply with the terms and provisions hereof
as if such member were the Optionee hereunder), or except in accordance with
the provisions of Section 9(c).



               c. Procedures on Sale of Stock to Third Parties. Except as otherwise
expressly provided herein, the Optionee hereby agrees, and each member of the
Group to which the Optionee belongs shall be deemed to agree, that she, he or
it shall not Sell any Shares except in accordance with the following
procedures:




               (i) The Selling Group shall first deliver to the Company a written
notice, which shall be irrevocable through the date of sale set forth in
Section 9(c) (iii) below, offering all or any part of the Shares owed by
the Selling Group at the purchase price and on the terms specified
therein, whereupon the Company shall have the right and option to
purchase all or any portion of the Shares so offered at the purchase
price and on the terms stated in the notice of intention to Sell (such
acceptance to be made by the delivery of a written notice to the Selling
Group within the 30-day period after delivery of the aforesaid notice of
intention to Sell, which acceptance shall indicate the number of Shares
to be purchased).




               (ii) The Company shall have the right to assign its right to
purchase Shares pursuant to Section 9(c) (i) above to one or more persons
or entities, including to stockholders of the Company.



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               (iii) Sales of Shares under the terms of Section 9(c) (i) above
shall be made at the offices of the Company on a mutually satisfactory
business day within 30 days after the expiration of the aforesaid 30-day
period, or on such earlier dates following expiration of the 30-day
period in Section 9(c) (i) above as may be agreed upon by the Company.
Delivery of certificates or other instruments evidencing such Shares duly
endorsed for transfer to the Company shall be made on such date against
payment of the purchase price therefor by cheek or wire’ transfer of
funds.




               (iv) If effective acceptance shall not be received pursuant to
Section 9(c) (1) above with respect to the Shares offered for sale
pursuant to the aforesaid written notice, then the Selling Group may Sell
all or any part of the remaining Shares so offered for sale at a price
not less than the price, and on terms not more favorable to the purchaser
thereof, than the terms, stated in the written notice of intention to
Sell, at any time within 90 days after the expiration of the offer made
pursuant to Section 9(c) (1) above. In the event the remaining Shares
are not sold by the Selling Group during such 90-day period, the right of
the Selling Group to Sell such remaining shares shall expire and the
obligations of this Section 9(c) shall be reinstated; provided, however,
that in the event the Selling Group determines, at any time during such
90-day period, the sale of all or any part of the remaining Shares on the
terms set forth in the written notice of intention to Sell is
impractical, the Selling Group may terminate the offer and reinstate the
procedure provided in this Section 9(c) without waiting for the
expiration of such 90-day




               (v) Notwithstanding anything obtained herein to the contrary, any
purchaser of Shares shall agree in writing in advance of any purchase of
Shares hereunder that it or he, as the case may be, shall be bound by and
comply with the terms and provisions of this Agreement as if such
purchaser were the Optionee hereunder, and the Shares so purchased shall
continue to be subject to repurchase as herein provided.




               (vi) Notwithstanding anything obtained herein to the contrary, the
right of the Company to purchase Shares owned by the Selling Group
pursuant to this Section 9(c) shall terminate effective as of the closing
of the Company’s initial public offering of Common Stock pursuant to a
registration statement filed under the Securities Act of 1933, as
amended.



               d. Escrow Arrangement; Distributions; Rights as a Stockholder.




          (i) All of the certificates representing the Shares, duly endorsed
in blank or with undated stock powers attached thereto, shall be held in
escrow by an independent escrow agent mutually acceptable to the Company
and the Optionee until (A) such Shares are repurchased by the Company as
provided in Section 9(c) hereof or (B) if earlier, the expiration of the
period(s) during which the Company may repurchase Shares hereunder. All
fees charged by the escrow agent and expenses relating thereto shall be
paid by the Company.



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          (ii) Except for the restrictions contained in this Agreement, upon
exercise of the Option with respect to any Shares, the Optionee shall
have all the rights as a stockholder of such Shares, subject to any
limitations imposed thereon by the Certificate of Incorporation of the
Company.



     10. Adjustment Provisions.



               a. Changes in Capital Structure. Subject to Section 10(b), in the event
the Common Stock is changed by reason of a stock split, reverse stock split,
stock dividend or recapitalization, or converted into or exchange for other
securities as a result of a merger, consolidation or reorganization, the Board
of Directors of the company shall make such adjustment in the number and class
of shares of stock with respect to which Options may be granted under this
Agreement as shall be equitable and appropriate in order to make this option,
as nearly as may be practicable, equivalent to the option outstanding
immediately prior to such change. A corresponding adjustment changing the
number and class of shares allocated to, and the option price of, this option
or portion thereof outstanding at the time of such change shall likewise be
made.



               b. Corporate Transactions. The following rules shall apply in connection
with the dissolution-or liquidation of the Company, a reorganization, merger or
consolidation in which the Company is not the surviving corporation, a sale of
all or substantially all of the assets of the Company to another person or
entity, or a transaction in which all of the stockholders of the Company
exchange their Common Stock for cash and/or securities (a “Corporate
Transaction”):




     (i) In the event the Company is party to a merger or other
reorganization, this option shall be subject to the agreement of
merger or reorganization. Unless otherwise provided in such
agreement of merger or reorganization, subject to Section 10(b)
(ii) hereof, upon the occurrence of a Corporate Transaction, this
option shall automatically terminate; provided, however, that the
Optionee shall either (A) be given (I) written notice of such
Corporate Transaction at least 20 days prior to its proposed
effective date (as specified in such notice) and (II) an
opportunity, during the period commencing with delivery of such
notice and ending ten days prior to such proposed effective date,
to exercise this option to the full extent to which this option
would have been exercisable by the Optionee at the expiration of
such 20-day period, or (B) be paid in cash or securities an amount
equal to the excess of the fair market value (as determined by the
Board of Directors of the Company as of the date of the Corporate
Transaction) of the shares of Common Stock with respect to which
this option is then exercisable over the option price of such shares; and




     (ii) Provisions may be made in connection with such Corporate
Transaction for the assumption of this option by, or the
substitution for this option of, new options covering the stock of,
the surviving, successor or purchasing corporation, or a parent or
subsidiary thereof, with appropriate adjustments as to the number,
kind and option price prices of shares subject to this option.



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               c. Special Rules. The following rules shall apply in connection with
Section 10(a) and (b) above:




     (i) No fractional shares shall be issued as a result of any
such adjustment, and any fractional shares resulting from the
computations pursuant to Section 10(a) or (b) shall be eliminated;




     (ii) No adjustment shall be made for cash dividends or the
issuance to stockholders of rights to subscribe for additional
shares of Common Stock or other securities; and




     (iii) Any adjustments referred to in Section 10(a) or (b)
shall be made by the Board of Directors in its sole discretion and
shall be conclusive and binding on the Optionee.



     11. Withholding Taxes. The Company’s obligation to deliver shares upon
the exercise of this option shall be subject to the Optionee’s satisfaction of
applicable federal, state and local income tax withholding requirements, if
any.



     12. Investment Representations; Legends.



               a. Representations. The Optionee represents, warrants and covenants that:




     (i) Any shares purchased upon exercise of this option shall be
acquired for the Optionee’s account for investment only, and not
with a view to, or for sale in connection with, any distribution of
the shares in violation of the Securities Act of 1933 (the
“Securities Act”), or any rule or regulation under the Securities
Act.




     (ii) The Optionee has had such opportunity as he has deemed
adequate to obtain from representatives of the Company such
information as is necessary to permit the Optionee to evaluate the
merits and risks of his investment in the Company.




     (iii) The Optionee is able to bear the economic risk of
holding such shares acquired pursuant to the exercise of this
option for an indefinite period.




     (iv) The Optionee understands that (A) the shares acquired
pursuant to the exercise of this option will not be registered
under the Securities Act and are “restricted securities within the
meaning of Rule 144 under the Securities Act; (B) such shares
cannot be sold, transferred or otherwise disposed of unless they
are subsequently registered under the Securities Act or an
exemption from registration is then available; (C) in any event, an
exemption from registration under Rule 144 or otherwise under the
Securities Act will not be available for at least two years and
even then will not be available unless a public market then exists
for the Common Stock, adequate information concerning the Company
is then available to the public, and other terms and conditions of
Rule 144 are



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complied with; and (D) there is now no registration statement
on file with the Securities and Exchange Commission with respect to
any stock of the Company and the Company has no obligation or
current intention to register any shares acquired pursuant to the
exercise of this option under the Securities Act.




     (v) The Optionee agrees that, if the Company offers any of its
Common Stock for sale pursuant to a registration statement under
the Securities Act, the Optionee will not, without the prior
written consent of the Company, offer, sell, contract to sell or
otherwise dispose of, directly or indirectly, any shares purchased
upon exercise of this option for a period of 180 days (or such
lesser period as the Company’s officers, directors and other
significant stockholders may agree upon with the underwriters in
such differing) after the effective date of such registration
statement.



By making payment upon exercise of this option, the Optionee shall be deemed to
have reaffirmed, as of the date of such payment, the representations,
warranties and covenants made in this Section 12.



               b. Legends on Stock Certificate. All stock certificates representing
shares of Common Stock issued to the Optionee upon exercise of this option
shall have affixed thereto legends substantially in the following forms, in
addition to any other legends required by applicable law:



“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE
SHAPES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE PLEDGED,
HYPOTHECATED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER SUCH ACT OR
AN OPINION OF COUNSEL TO THE ISSUER THAT REGISTRATION IS NOT
REQUIRED UNDER SUCH ACT. ADDITIONALLY, THE TRANSFER OF THE
SHARES REPRESENTED BY THIS CERTIFICATE ARE RESTRICTED PURSUANT TO
THE PROVISIONS SPECIFIED IN THE NON-QUALIFIED STOCK OPTION
AGREEMENT, DATED AS OF DECEMBER 30, 1993 BETWEEN DIACRIN, INC.

AND DR. JOSEPH AVRUCH, AND NO TRANSFER OF THESE SHARES SHALL BE
VALID OR EFFECTIVE UNTIL SUCH CONDITIONS HAVE BEEN FULFILLED.
COPIES OF SUCH AGREEMENT MAY BE OBTAINED AT NO COST BY WRITTEN
REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE
SECRETARY OF DIACRIN, INC.”



     13. Release and Waiver.



               a. The Optionee agrees that the execution and delivery by the Company of
this Agreement constitutes full performance by the Company of its obligations
under all agreements, written or oral, relating to the Optionee’s rights to
purchase equity securities of the Company,



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and the Optionee hereby agrees and acknowledges that the Optionee has no
further claim or right to receive any capital stock of, or other equity
interest in, the Company, and that, except as provided in this agreement, the
Company has no further obligations, direct or indirect, to the optionee
relating to capital stock or equity interests.




               b. Pursuant to an agreement between the Company and The General Hospital
Corporation (“NCR”), certain provisions of the Research and License Agreement
effective as of October 1, 1989 between the Company and MGH (the “MGH
Agreement”) have been terminated effective as of November 1, 1992. The
Optionee hereby acknowledges such termination, and agrees that he has no
rights, whether as a third party beneficiary or otherwise, under the NCR
Agreement. The Optionee agrees that the Company has no obligation to provide
funding or support for research programs under the MGH Agreement, and the
Optionee waives any rights under the MGH Agreement or to funding from the
Company.



               c. Except for obligations and liabilities created by the provisions of
this agreement, the Optionee hereby releases and discharges the Company and its
employees, officers, directors, significant stockholders (as defined below) and
their respective affiliates from any and all claims, demands, obligations and
liabilities of any nature whatsoever which the Optionee ever had, now has or
hereafter may have by reason of any matter, cause or event occurring prior to
the date hereof. As used above, the term “significant stockholders” means any
holder of equity securities of the Company representing 5% or more of the
voting power of outstanding securities of the Company.



               d. Except for obligations and liabilities created by the provisions of
this agreement, the Company and HealthCare Ventures II, L.P. hereby release and
discharge the Optionee from any and all demands, obligations and liabilities of
any nature whatsoever which it ever had, now has or hereafter may have by
reason of any matter, cause or event occurring prior to the date hereof.



     14. Miscellaneous.



               a. Except as provided herein, this option may not be amended or otherwise
modified unless evidenced in writing and signed by the Company and the
Optionee.



               b. All notices under this option shall be mailed or delivered by hand to
the parties at their respective addresses set forth beneath their names below
or at such other address as may be designated in writing by either of the
parties to one another.



               c. This option shall be governed by and construed in accordance with the
laws of the Commonwealth of Massachusetts.



	 	 	 	 	 
	Date of Grant:	 	DIACRIN, INC.
	 
	 	 	 	 
	December 30, 1993

	 	By:
	 	/s/ Thomas H. Fraser
	

	 	 	 	

	

	 	Title:
	 	President and Chief
	

	 	 	 	Executive Officer
	 
	 	 	 	 
	

	 	Address:
	 	Building 96  – 13th Street
	

	 	 	 	Charlestown Navy Yard
	

	 	 	 	Charlestown, MA 02129
	 
	 	 	 	 
	 	 	/s/ Joseph Avruch, M.D.
	 	 	

	 	 	Joseph Avruch, M.D.
	

	 	Address:	 	 







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     The undersigned agrees with the provisions of Section 13(d) of this agreement.



	 	 	 	 	 	 	 
	 	 	HEALTHCARE VENTURES II, L. P.
	 
	 	 	 	 	 	 
	 	 	By:	 	HealthCare Partners II, L.P.
	 
	 	 	 	 	 	 
	

	 	 	 	By:
	 	/s/ John W. Littlechild
	

	 	 	 	 	 	

	

	 	 	 	 	 	John W. Littlechild,
	

	 	 	 	 	 	General Partner







 









 






Dr. Joseph Avruch




DIACRIN, INC.




AMENDMENT TO NON-STATUTORY STOCK OPTION AGREEMENT




As of September 12, 1994



WHEREAS, the undersigned Diacrin, Inc., a Delaware corporation (the “Company”),
and Dr. Joseph Avruch (the “Optionee”) are parties to a Non-Statutory Stock
Option Agreement (the “Option”) granting the Optionee the right to purchase
115,000 shares of the Company’s Common Stock at an exercise price of $2.00 per
share, which Option was granted on December 30, 1993; and



WHEREAS, on September 12, 1994, the Board of Directors of the Company (the
“Board”) voted to reduce the exercise price of the Option to $1.25 per share,
which price was determined by the Board to be the fair market value of the
Company’ s Common Stock on such date.



NOW, THEREFORE, the Option is hereby amended as follows:



ARTICLE ONE. Amendment of Option. The Option Price of the Option is hereby
amended by decreasing the existing Option Price of $2.00 to $1.25.



ARTICLE TWO. Confirmation of the Option. Except as set forth in ARTICLE ONE
of this Amendment, the Option is, in all respects, hereby ratified and
confirmed and shall continue in full force and effect as amended hereby.



Executed as of the date set forth above.




	 	 	 	 	 
	 	 	COMPANY:
	 
	 	 	 	 
	 	 	DIACRIN, INC.
	 
	 	 	 	 
	

	 	By:
	 	/s/Thomas H. Fraser
	

	 	 	 	

	

	 	Name:
	 	Thomas H. Fraser, Ph.D.
	

	 	Title:
	 	President and CEO
	 
	 	 	 	 
	 	 	OPTIONEE:
	 
	 	 	 	 
	 	 	/s/ Joseph Avruch
	 	 	

	 	 	Dr. Joseph Avruch