Form of Incentive Stock Option Grant


 Exhibit 10.1 
  
 Grant with vesting 
  
 ORTHOVITA, INC. 
 1997 EQUITY COMPENSATION PLAN

  
 INCENTIVE STOCK OPTION GRANT 
  
 This STOCK OPTION GRANT, dated as of December
    , 2005 (the “Date of Grant”), is delivered by Orthovita, Inc. (the “Company”) to
                                 (the “Grantee”), an employee of the
Company. 
  
 RECITALS 
  
 The Orthovita, Inc. 1997 Equity Compensation Plan (the “Plan”)
provides for the grant of options to purchase shares of common stock of the Company. The Compensation Committee of the Board of Directors of the Company (the “Committee”) has decided to make a stock option grant to promote the best
interests of the Company and its shareholders. 
  
 NOW, THEREFORE,
the parties to this Agreement, intending to be legally bound hereby, agree as follows: 
  
 1. Grant of Option. 
  
 (a) Subject to the terms and conditions set forth in this Agreement and in the Plan, the Company hereby grants to the Grantee an incentive stock option (the “Option”) to purchase
                     shares of common stock of the Company (“Shares”) at an option price of
                     per Share. The Option shall become exercisable according to Paragraph 2 below. 
  
 (b) The Option is designated as an incentive stock option, as described in
Paragraph 5 below. However, if and to the extent the Option exceeds the limits for an incentive stock option, as described in Paragraph 5, the Option shall be a nonqualified stock option. 
  
 2. Exercisability of Option. The Option shall become exercisable on the following dates, if the Grantee is employed
by, or providing service to, the Company on the applicable date: 
  

			
	 Date

	  	 Shares for Which the Option is
 Exercisable


	 ____________________________
	  	_______________
		
	 ____________________________
	  	_______________
		
	 ____________________________
	  	_______________
		
	 ____________________________
	  	_______________

  
 The exercisability of the Option is
cumulative, but shall not exceed 100% of the Shares subject to the Option. If the foregoing schedule would produce fractional Shares, the number of Shares for which the Option becomes exercisable shall be rounded down to the nearest whole Share. For
purposes of this Agreement, employment with the Company shall mean employment as an employee or consultant of the Company or a subsidiary or a member of the Board of Directors of the Company. 






 3. Term of Option. 
  
 (a) The Option shall have a term of ten years from the Date of Grant and shall terminate at the expiration of that period
unless it is terminated at an earlier date pursuant to the provisions of this Agreement or the Plan. 
  
 (b) The Option shall automatically terminate upon the happening of the first of the following events: 
  
 (i) The expiration of the 90-day period after the
Grantee’s termination of employment with the Company, if the termination is for any reason other than disability (as defined in the Plan), death or cause (as defined in the Plan); 
  
 (ii) The expiration of the one-year period after the Grantee’s termination of employment from the
Company on account of the Grantee’s disability (as defined in the Plan); 
  
 (iii) The expiration of the one-year period after the Grantee’s termination of employment, if the Grantee dies while employed by the
Company or within 90 days after the Grantee ceases to be so employed on account of a termination of employment described in subparagraph (i) above; or 
  
 (iv) The date on which the Grantee’s employment is terminated for cause (as defined in the Plan). 
  
 Notwithstanding the foregoing, in no event may the Option be exercised after the date that is
immediately before the tenth anniversary of the Date of Grant. Any portion of the Option that is not exercisable at the time the Grantee ceases to be employed by the Company shall immediately terminate. 
  
 4. Exercise Procedures. 
  
 (a) Subject to the provisions of Paragraphs 2 and 3 above, the Grantee may
exercise part or all of the Option by giving the Committee written notice of intent to exercise in the manner provided in this Agreement, specifying the number of Shares as to which the Option is to be exercised and the method of payment. Payment of
the exercise price shall be made in accordance with procedures established by the Committee from time to time based on type of payment being made but, in any event, prior to issuance of the shares. The Grantee shall pay the exercise price
(i) in cash, (ii) with the approval of the Committee, by delivering Shares of the Company which shall be valued at their fair market value on the date of delivery, or by attestation (on a form prescribed by the Committee) to ownership of
Shares having a fair market value on the date of exercise equal to the exercise price, (iii) by payment through a broker in accordance with procedures permitted by Regulation T of the Federal Reserve Board or (iv) by 

  

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such other method as the Committee may approve. The Committee may impose from time to time such limitations as it deems appropriate on the use of Shares of
the Company to exercise the Option. 
  
 (b) The obligation of the
Company to deliver Shares upon exercise of the Option shall be subject to all applicable laws, rules, and regulations and such approvals by governmental agencies as may be deemed appropriate by the Committee, including such actions as Company
counsel shall deem necessary or appropriate to comply with relevant securities laws and regulations. The Company may require that the Grantee (or other person exercising the Option after the Grantee’s death) represent that the Grantee is
purchasing Shares for the Grantee’s own account and not with a view to or for sale in connection with any distribution of the Shares, or such other representation as the Committee deems appropriate. 
  
 (c) All obligations of the Company under this Agreement shall be subject to
the rights of the Company as set forth in the Plan to withhold amounts required to be withheld for any taxes, if applicable. The Grantee may elect to satisfy any tax withholding obligation of the Company with respect to the Option by having Shares
withheld up to an amount that does not exceed the minimum applicable withholding tax rate for federal (including FICA), state and local tax liabilities, subject to prior approval of the Committee. 
  
 5. Designation as Incentive Stock Option. 
  
 (a) This Option is designated an incentive stock option under
Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”). If the aggregate fair market value of the stock on the date of the grant with respect to which incentive stock options are exercisable for the first time by
the Grantee during any calendar year, under the Plan or any other stock option plan of the Company or a parent or subsidiary, exceeds $100,000, then the Option, as to the excess, shall be treated as a nonqualified stock option that does not meet the
requirements of Section 422. If and to the extent that the Option fails to qualify as an incentive stock option under the Code, the Option shall remain outstanding according to its terms as a nonqualified stock option. 
  
 (b) The Grantee understands that favorable incentive stock option tax
treatment is available only if the Option is exercised while the Grantee is an employee of the Company or a parent or subsidiary of the Company or within a period of time specified in the Code after the Grantee ceases to be an employee. The Grantee
understands that the Grantee is responsible for the income tax consequences of the Option, and, among other tax consequences, the Grantee understands that he or she may be subject to the alternative minimum tax under the Code in the year in which
the Option is exercised. The Grantee will consult with his or her tax adviser regarding the tax consequences of the Option. 
  
 6. Change of Control. The provisions of the Plan applicable to a Change of Control shall apply to the Option, and, in the event of a Change of
Control, the Committee may take such actions as it deems appropriate pursuant to the Plan. 
  

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 7. Restrictions on Exercise. Only the Grantee may exercise the Option during the Grantee’s
lifetime. After the Grantee’s death, the Option shall be exercisable (subject to the limitations specified in the Plan) solely by the legal representatives of the Grantee, or by the person who acquires the right to exercise the Option by will
or by the laws of descent and distribution, to the extent that the Option is exercisable pursuant to this Agreement. 
  
 8. Grant Subject to Plan Provisions. This grant is made pursuant to the Plan, the terms of which are incorporated herein by reference, and in all
respects shall be interpreted in accordance with the Plan. The grant and exercise of the Option are subject to the provisions of the Plan and to interpretations, regulations and determinations concerning the Plan established from time to time by the
Committee in accordance with the provisions of the Plan, including, but not limited to, provisions pertaining to (i) rights and obligations with respect to withholding taxes, (ii) the registration, qualification or listing of the Shares,
(iii) capital or other changes of the Company and (iv) other requirements of applicable law. The Committee shall have the authority to interpret and construe the Option pursuant to the terms of the Plan, and its decisions shall be
conclusive as to any questions arising hereunder. 
  
 9. No
Employment Rights. The grant of the Option shall not confer upon the Grantee any right to continue in the employ of the Company and shall not interfere in any way with the right of the Company to terminate the Grantee’s employment at any
time. The right of the Company to terminate at will the Grantee’s employment at any time for any reason is specifically reserved. 
  
 10. No Shareholder Rights. Neither the Grantee, nor any person entitled to exercise the Grantee’s rights in the event of the Grantee’s
death, shall have any of the rights and privileges of a shareholder with respect to the Shares subject to the Option, until certificates for Shares have been issued upon the exercise of the Option. 
  
 11. Assignment and Transfers. The rights and interests of the Grantee
under this Agreement may not be sold, assigned, encumbered or otherwise transferred except, in the event of the death of the Grantee, by will or by the laws of descent and distribution. In the event of any attempt by the Grantee to alienate, assign,
pledge, hypothecate, or otherwise dispose of the Option or any right hereunder, except as provided for in this Agreement, or in the event of the levy or any attachment, execution or similar process upon the rights or interests hereby conferred, the
Company may terminate the Option by notice to the Grantee, and the Option and all rights hereunder shall thereupon become null and void. The rights and protections of the Company hereunder shall extend to any successors or assigns of the Company and
to the Company’s parents, subsidiaries, and affiliates. This Agreement may be assigned by the Company without the Grantee’s consent. 
  
 12. Applicable Law. The validity, construction, interpretation and effect of this instrument shall be governed by and determined in accordance with
the laws of the Commonwealth of Pennsylvania. 
  
 13.
Notice. Any notice to the Company provided for in this instrument shall be addressed to the Company in care of the                     
at                                 , and 

  

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any notice to the Grantee shall be addressed to such Grantee at the current address shown on the payroll of the Company, or to such other address as the
Grantee may designate to the Company in writing. Any notice shall be delivered by hand, sent by telecopy or enclosed in a properly sealed envelope addressed as stated above, registered and deposited, postage prepaid, in a post office regularly
maintained by the United States Postal Service. 
  
 IN WITNESS
WHEREOF, the Company has caused its duly authorized officers to execute and attest this Agreement, and the Grantee has executed this Agreement, effective as of the Date of Grant. 
  

							
	 	 	 	 	 ORTHOVITA, INC.

	 Attest:
	 	 	 	 	 	 
				
	  

	 	 	 	 By:
	 	  


	 	 	 	 	 	 	 Antony Koblish, President


  
 I hereby accept the Option described
in this Agreement, and I agree to be bound by the terms of the Plan and this Agreement. I hereby further agree that all the decisions and determinations of the Committee shall be final and binding. 
  

			
	 Grantee:
	 	  




  

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