exv10w1





Exhibit 10.1




MOLECULAR INSIGHT PHARMACEUTICALS, INC.




DANIEL PETERS INDUCEMENT GRANT

NONQUALIFIED STOCK OPTION AWARD AGREEMENT




Mr. Daniel L. Peters

6 Whitesell Lane

Newtown, PA 18940




Dear Mr. Peters:




     Molecular Insight Pharmaceuticals, Inc., a Massachusetts corporation (the “Company”) hereby
grants an option to you to purchase from the Company one hundred twenty five thousand
(125,000) shares of Common Stock of the Company (the “Option”) at an exercise price per share equal
to $5.70, which grant shall be subject to all of the terms and conditions set forth below in this
Option Award Agreement (the “Option Award”).



     This Option is granted outside the Company’s Amended and Restated 2006 Equity Incentive Plan
and is not intended to satisfy the requirements of Section 422 of the Internal Revenue Code and
thus shall not be an “incentive stock option.” This Option is being granted as an “employee
inducement award” within the meaning of Rule 4350(i)(1)A)(iv) of the NASDAQ Stock Market
Marketplace Rules.



	 	 	 
	Definitions:
	 	Certain capitalized terms used in this Option Award are
defined as follows:








	 	(a)	 	“Affiliate” means any entity that, directly or through one
or more intermediaries, is controlled by, controls, or is
under common control with the Company within the meaning of
Code Sections 414(b) or (c), provided that, in applying such
provisions, the phrase “at least 50 percent” shall be used in
place of “at least 80 percent” each place it appears therein.
	 
	 	(b)	 	“Board” means the Board of Directors of the Company.
	 
	 	(c)	 	“Cause” shall mean a vote of the Board of the Company
resolving that you should be dismissed as a result of (i) the
commission of any act constituting financial dishonesty
against the Company (which act would be chargeable as a crime
under applicable law); (ii) engaging in any other act of
dishonesty, fraud, intentional misrepresentation, moral
turpitude, illegality or harassment which, as determined in
good faith by the Board, would materially adversely affect the
business or the reputation of the Company with its customers,
suppliers, lenders and/or other third parties with whom the
Company does business; (iii) the repeated failure to follow
the written directives of the Board, which failure has not
been corrected within 30 days after written notice from the
Board, or (iv) any material violation of the Company’s written
policies, or willful and deliberate non-performance of duty in
connection with the business affairs of the Company, after
written warning of such violation from the Board and failure
to remedy the same within 30 days after such notice.




 









 






	 	(d)	 	“Change of Control” means the occurrence of any one of the
following events after the Grant Date:






     (i) A change in the ownership of the Company, which shall
occur on the date that any one Person, or more than one Person
Acting as a Group (as defined below), other than Excluded
Person(s) (as defined below), acquires ownership of the stock
of the Company that, together with the stock then held by such
Person or group, constitutes more than fifty percent (50%) of
the total fair market value of the stock of the Company.
However, if any one Person or more than one Person Acting as a
Group is considered to own more than fifty (50%) of the total
fair market value of the stock of the Company, the acquisition
of additional stock by the same Person or Persons is not
considered to cause a Change of Control.




     (ii) A change in the effective control of the Company, which
shall occur on the date that:




     (A) Any one Person, or more than one Person Acting as a Group,
other than Excluded Person(s), acquires (or has acquired
during the twelve (12)
month period ending on the date of the
most recent acquisition by such Person or Persons) ownership
of stock of the Company possessing thirty-five percent (35%)
or more of the total voting power of the stock of the Company.
However, if any one Person or more than one Person Acting as
a Group is considered to own more than thirty-five percent
(35%) of the total voting power of the stock of the Company,
the acquisition of additional voting stock by the same Person
or Persons is not considered to cause a Change of Control; or




     (B) A majority of the members of the Company’s Board of
Directors is replaced during any twelve (12) month period by
directors whose appointment or election is not endorsed by a
majority of the members of the Company’s Board of Directors
prior to the date of the appointment or election.




     (iii) A change in the ownership of a substantial portion of
the Company’s assets, which shall occur on the date that any
one Person, or more than one Person Acting as a Group, other
than Excluded Person(s), acquires (or has acquired during the
twelve (12) month period ending on the date of the most recent
acquisition by such Person or Persons) assets from the Company
that have a total Gross Fair Market Value (as defined below)
equal to more than sixty percent (60%) of the total Gross Fair
Market Value of all the assets of the Company immediately
prior to such acquisition or acquisitions, other than an
Excluded Transaction (as defined below).



2









 







For purposes of this subsection (d):




     “Gross Fair Market Value” means the value of the assets of the
Company, or the value of the assets being disposed of, as
applicable, determined without regard to any liabilities
associated with such assets.




     Persons will be considered to be “Acting as a Group” if they
act in concert, provided that Persons will not be considered
to be Acting as a Group solely because they purchase or own
stock of the Company at the same time, or as a result of the
same public offering, or solely because they purchase assets
of the Company at the same time, or as a result of the same
public offering, as the case may be. However, Persons will be
considered to be Acting as a Group if they are owners of an
entity that enters into a merger, consolidation, purchase or
acquisition of assets, or similar business transaction with
the Company.




     The term “Excluded Transaction” means any a transaction in
which assets are transferred to: (A) a shareholder of the
Company (determined immediately before the asset transfer) in
exchange for or with respect to its stock; (B) an entity,
fifty percent (50%) or more of the total value or voting power
of which is owned, directly or indirectly, by the Company
(determined after the asset transfer); (C) a Person, or more
than one Person Acting as a Group, that owns, directly or
indirectly, fifty percent (50%) or more of the total value or
voting power of all the outstanding stock of the Company
(determined after the asset transfer); or (D) an entity at
least fifty percent (50%) of the total value or voting power
of which is owned, directly or indirectly, by a Person
described in clause (C) (determined after the asset transfer).




     The term “Excluded Person(s)” means (A) the Company or any of
its Affiliates, (B) a trustee or other fiduciary holding
securities under an employee benefit plan of the Company or
any of its Affiliates, (C) an underwriter temporarily holding
securities pursuant to an offering of such securities, or (D)
a corporation owned, directly or indirectly, by the
shareholders of the Company in substantially the same
proportions as their ownership of stock in the Company.




     The term “Change of Control” as defined above shall be amended
and construed in accordance with any subsequent guidance,
rules or regulations promulgated by the Internal Revenue
Service in construing the rules and regulations applicable to
Code Section 409A.




	 	(e)	 	“Code” means the Internal Revenue Code of 1986, as amended.
	 
	 	(f)	 	“Committee” means the Compensation Committee of the Board
(or a successor committee with the same or similar authority).




3









 






	 	(g)	 	“Common Stock” means the common stock of the Company.
	 
	 	(h)	 	“Disability” means the inability to engage in any
substantial gainful activity by reason of any medically
determinable physical or mental impairment that can be
expected to result in death or can be expected to last for a
continuous period of at least twelve (12) months, as
determined by the Committee. The Committee may request such
evidence of disability as it reasonably determines.
	 
	 	(i)	 	“Exchange Act” means the Securities Exchange Act of 1934,
as amended.
	 
	 	(j)	 	“Person” has the meaning given in Section 3(a)(9) of the
Exchange Act, as modified and used in Sections 13(d) and 14(d)
thereof.
	 
	 	(k)	 	“Retirement” means, with respect to any employee,
termination of employment from the Company and its Affiliates
(for other than Cause) on or after attainment of age
fifty-five (55) and completion of ten (10) years of continuous
service with the Company and its Affiliates, and with respect
to any Director, means the Director’s resignation or failure
to be re-elected following completion of the Director’s term.





	 	 	 
	Grant Date:
	 	August 11, 2009

	 	 	 

	Type of Option:
	 	Nonqualified Stock Option

	 	 	 

	Number of Option Shares:
	 	125,000 shares of Common Stock

	 	 	 

	Exercise Price per Share:
	 	US$5.70

	 	 	 

	Expiration:
	 	Close of business at the Company headquarters on the tenth
(10th) anniversary of the Grant Date,
subject to earlier termination as described under “Termination
of Employment or Service Arrangement.”

	 	 	 

	Vesting:
	 	Your Option will vest in
installments upon achievement of certain performance goals as
specified in Appendix A hereto, provided you are continuously
employed by, or continuously provide services to, the Company
or an Affiliate until and on each applicable achievement date
of applicable performance goals, and subject to the
acceleration of vesting in the event of a Change of Control or
termination without Cause as provided below.

	 	 	 

	Termination of
Employment or Service
Arrangement
	 	If your employment or service arrangement with the Company and
its Affiliates is terminated by the Company or its Affiliates
without Cause, the unvested portion of your Option that
otherwise would have vested in the then-current fiscal year if
the applicable milestone(s) had been achieved in that year and
if you had remained employed during such period will
automatically vest upon the date of termination. After giving
effect to such acceleration, the vested portion of your Option
will terminate on the Close of Business of the







4









 






	 	 	 
	 	 	first (1st) anniversary date of such termination without
Cause, and the then-unvested portion of your Option will
terminate on the date of such termination.

	 	 	 

	 	 	If your employment or service arrangement terminates as a
result of death or Disability, the vested portion of your
Option will terminate on the Close of Business of the first
(1st) anniversary date of such termination as a
result of death or Disability, and the unvested portion of
your Option will terminate on the date of such termination.

	 	 	 

	 	 	If your employment terminates as a result of your resignation
or Retirement, the vested portion of your Option will
terminate ninety (90) calendar days after the date of your
termination of employment, and the unvested portion of your
Option will terminate on the date of such termination.

	 	 	 

	 	 	If your employment or service arrangement is terminated for
Cause, your entire Option (whether vested or unvested) is
terminated immediately on the date of termination. In
addition, if you have submitted a notice of exercise that has
not yet been processed and your employment or service
arrangement is terminated for Cause, your notice of exercise
will be rescinded and your exercise price will be returned to
you.

	 	 	 

	 	 	If your employment or service arrangement terminates for any
other reason other than as described above, the vested portion
of your Option will terminate ninety (90) calendar days after
the date of the termination, and the unvested portion of your
Option will terminate on the date of such termination.

	 	 	 

	Change of Control:
	 	In the event of a Change of Control of the Company during the
period that you are employed with the Company or providing
services to the Company, your Option will become vested in
full immediately prior to the consummation of such Change of
Control and notwithstanding the provisions of above, will be
exercisable until the later of (i) the Close of Business on
the first (1st) anniversary date of such Change of
Control or (ii) the Close of Business on the first
(1st) anniversary date of your termination if your
employment is terminated after such Change of Control.
Notwithstanding any of the foregoing provisions, in no event
may you exercise the vested portion of your Option (pursuant
to regular vesting schedules or as a result of acceleration)
after the Close of Business on the tenth
(10th) anniversary of the Grant Date.

	 	 	 

	Manner of Exercise:
	 	You may exercise your Option only to the extent vested and
only if the Option has not terminated. To exercise your
Option, you must complete the “Notice of Stock Option
Exercise” form provided by the Company and return it to the
address indicated on the form. Your form must specify how
many shares you wish to purchase and will explain how you must
satisfy the exercise price and withholding taxes due, if any,
upon exercise. The form will be effective when it is received
by the Company.

	 	 	 

	 	 	If someone else wants to exercise your Option after your
death, that person must contact the Company and prove to the
Company’s satisfaction that he or







5









 






	 	 	 
	 	 	she is entitled to do so.
Your ability to exercise the Option may be restricted by the
Company if required by applicable law, any Company policy or
any agreement between the Company and its underwriters.

	 	 	 

	Requirements of Law and
Securities Exchange:
	 	The granting of this Option and the issuance of shares of
Common Stock in connection with the exercise of this Option
are subject to all applicable laws, rules and regulations and
to such approvals by any governmental agencies or national
securities exchanges as may be required. Notwithstanding any
other provision of this Option Award, the Company has no
liability to deliver any shares of Common Stock under this
Option or make any payment unless such delivery or payment
would comply with all applicable laws and the applicable
requirements of any securities exchange or similar entity, and
unless and until you have taken all actions required by the
Company in connection therewith. The Company may impose such
restrictions on any shares issued under this Option as the
Company determines necessary or desirable to comply with all
applicable laws, rules and regulations or the applicable
requirements of any national securities exchanges.

	 	 	 

	Transferability:
	 	You may not transfer or assign your Option for any reason,
other than under your will or as required by intestate laws.
Any attempted transfer or assignment in violation of this
provision will be null and void. During your lifetime, only
you (or your guardian or legal representative if approved by
the Company in the event of your incapacity) are entitled to
exercise the vested portion of your Option.

	 	 	 

	Restrictions on Resale:
	 	By accepting the Option, you agree not to sell any Shares
acquired under the Option at a time when applicable laws,
Company policies or an agreement between the Company and its
underwriters prohibit a sale.

	 	 	 

	No Right to Continue
Employment or Service:
	 	Neither this Option nor any related material shall give you
the right to continue in employment by or perform services to
the Company or shall adversely affect the right of the Company
to terminate your employment or service relationship with the
Company with or without Cause at any time.

	 	 	 

	No Fractional Shares:
	 	No fractional shares of Common Stock may be issued or
delivered pursuant to the exercise of this Option, and the
Committee may determine whether cash, other securities or
other property will be paid or transferred in lieu of any
fractional shares, or whether such fractional shares or any
rights to fractional shares will be canceled, terminated or
otherwise eliminated.

	 	 	 

	Tax Withholding:
	 	This Option has been granted subject to the condition that you
consent to whatever action the Committee directs to satisfy
the statutory federal and state tax withholding requirements,
if any, which the Company determines are applicable upon the
exercise of this Option.

	 	 	 

	Availability of Annual
Report to Stockholders
and Other SEC Filings:
	 	A copy of the Company’s most recent annual report to
stockholders and other filings made with the Securities and
Exchange Commission are available on the Company’s internet
website, www.molecularinsight.com, under the “Investors
Relations” section. If you would like to receive a paper copy
of the Company’s most recent annual report to stockholders and
other filings made by the Company with the Securities and
Exchange Commission, please







6









 






	 	 	 
	 	 	contact Vice President and General
Counsel of the Company.






	 	 	 	 	 
	Miscellaneous:
	 	•
	 	This Option Award shall be governed by the laws of the
Commonwealth of Massachusetts, without reference to any
conflict of law principles.








	 	•	 	This Option Award may be amended only by written
consent signed by you and the Company, except to the extent
the amendment is not to your detriment or the Committee deems
it necessary to comply with any applicable law or listing
requirement of any principal securities exchange or market on
which the Company’s common stock is then traded, or to
preserve favorable accounting treatment of the Option for the
Company.
	 
	 	•	 	As a condition of the granting of the Option, you
agree, for yourself and your legal representatives or
guardians, that this Option Award shall be interpreted by the
Committee and that any interpretation by the Committee of the
terms of this Option Award and any determination made by the
Committee pursuant to this Option Award shall be final,
binding and conclusive.
	 
	 	•	 	This Option Award may be executed in counterparts.





[SIGNATURE PAGE FOLLOWS]




7









 





	 	 	 	 	 
	 	MOLECULAR INSIGHT PHARMACEUTICALS, INC.

 	 
	 	By: 	 /s/
Charles
H. Abdalian, Jr.	 
	 	 	Authorized Officer 	 



OPTIONEE’S ACCEPTANCE



BY SIGNING BELOW AND ACCEPTING THIS INDUCEMENT STOCK OPTION AWARD, OPTIONEE AGREES TO ALL OF THE
TERMS AND CONDITIONS DESCRIBED HEREIN.




	 	 	 	 	 
	 

	 	 
	 	 
	 

	 	/s/
Daniel L. Peters 
	 

	 	 
	 

	 	Optionee Signature
	 
	 	 	 	 
	 

	 	Print Name:
	 	Daniel L. Peters
	 

	 	 	 	 
	 

	 	Address:
	 	6 Whitesell Lane
	 

	 	 	 	 
	 

	 	 	 	Newtown, PA 18940