**EXHIBIT 10.3**

 
| 2005 NSO  |   |   |   |   |   | Shares |   |
|---------------------|--------|--------|--------|--------|--------|--------|--------|

 

**BENTLEY PHARMACEUTICALS, INC.**

 

**2005 Equity and Incentive Plan**

 

**Non-Statutory Stock Option Certificate**

 

Bentley Pharmaceuticals, Inc.(the “Company”), a Delaware corporation, hereby grants to the person namedbelow an option to purchase shares of Common Stock, $0.02 par value per share,of the Company (the “Option”) pursuant to and subject to the Company’s 2005Equity and Incentive Plan (the “Plan”) (all such terms and conditions of thePlan being incorporated herein by reference as fully as if set forth herein),exercisable on the following terms and conditions **includingthose set forth on the reverse side of this Certificate:**

 
| Name of  Optionholder:    |   |   |   |
|---------------------------|--------|--------|--------|
|                      |   |   |   |
| Address:                  |   |   |   |
|                      |   |   |   |
| Social Security  No:      |   |   |   |
|                      |   |   |   |
| No. of  Shares:      |   |   |   |
|                      |   |   |   |
| Option Price:             |   |   |   |
|                      |   |   |   |
| Date of Grant:            |   |   |   |
|                      |   |   |   |
| Exercisability  Schedule: |   |   |   |
|                      |   |   |   |
| Expiration Date:          |   |   |   |   |
|                           |        |        |        |  |

 

This Option shall notbe treated as an Incentive Stock Option under section 422 of the InternalRevenue Code of 1986, as amended (the “Code”).

 

By acceptance of thisOption, the Optionholder agrees to all the terms and conditions hereofincluding, without limitation, those set forth in the Plan and on the reverseside hereof.

 
|                     | BENTLEY  PHARMACEUTICALS, INC. |
|--------------------------|--------------------------------|
|                     |                           |
|                     |                           |
|                     | By:                            |   |   |
|                     |                           |
|                     | Title:                         |
|                     |                           |
| ACCEPTED AND  AGREED TO: |                           |
|                     |                           |
|                     |                           |   |
| *Optionholder*           |                           |

 

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**BENTLEY PHARMACEUTICALS, INC. 2005 EQUITY ANDINCENTIVE PLAN**

**Non-Statutory Stock Option Terms and Conditions**

 

*1.**              **PlanIncorporated by Reference**. This Option is issued pursuant to the terms of the Plan and may be amendedas provided in the Plan.  Capitalizedterms used and not otherwise defined in this certificate have the meaningsgiven to them in the Plan. This certificate does not set forth all of the termsand conditions of the Plan, which are incorporated herein by reference.  The Committee administers the Plan and itsdeterminations regarding the operation of the Plan are final and binding.  Copies of the Plan may be obtained upon writtenrequest without charge from the Secretary of the Company.*

 

*2.**              **OptionPrice**.  The price to bepaid for each share of Common Stock issued upon exercise of the whole or anypart of this Option is the Option Price set forth on the face of thiscertificate.*

 

*3.**              **ExercisabilitySchedule**.  This Option maybe exercised at any time and from time to time for the number of shares and inaccordance with the exercisability schedule set forth on the face of thiscertificate, but only for the purchase of whole shares.  This Option may not be exercised as to anyshares after the Expiration Date.*

 

*4.**              **Method ofExercise**. To exercise this Option, the Optionholder shalldeliver written notice of exercise to the Company specifying the number ofshares with respect to which the Option is being exercised, accompanied bypayment in full of the Option Price for such shares. Such payment may be madein whole or in part in cash or to the extent permitted by the Committee at orafter the grant of the Option, pursuant to any of the following methods: (i) byactual delivery and transfer, or attestation of ownership and delivery of avalid instrument of transfer, to the Company of shares of Common Stock owned bythe Optionholder, including vested Restricted Stock, (ii) by retainingshares of Common Stock otherwise issuable pursuant to the Option, (iii) forconsideration received by the Company under a broker-assisted cashless exerciseprogram acceptable to the Company, or (iv) for such other lawfulconsideration as the Committee may determine. Promptly following such notice,the Company will deliver to the Optionholder a certificate representing thenumber of shares with respect to which the Option is being exercised.*

 

*5.**              **Rights asa Stockholder or Employee**. The Optionholder shall not have any rights in respect of shares as towhich the Option shall not have been exercised and payment made as providedabove.  The Optionholder shall not haveany rights to continued employment or service by the Company or its Affiliatesby virtue of the grant of this Option.*

 

*6.**              **Change inControl**.  As provided inthe Plan, in the event of a Change in Control affecting the Company’soutstanding Common Stock, the Committee shall equitably adjust the number andkind of shares subject to this Option and the exercise price hereunder or makeprovision for a cash payment. If such Change in Control involves aconsolidation or merger of the Company with another entity, the sale orexchange of all or substantially all of the assets of the Company or areorganization or liquidation of the Company, then in lieu of the foregoing,the Committee may upon written notice to the Optionholder provide that thisOption shall terminate on a date not less than 20 days after the date of suchnotice unless theretofore exercised. In connection with such notice, theCommittee may in its discretion accelerate or waive any deferred exerciseperiod.*

 

*7.**              **OptionNot Transferable**.  ThisOption is not transferable by the Optionholder otherwise than by will or thelaws of descent and distribution, and is exercisable during the Optionholder’slifetime only by the Optionholder or the Optionholder’s guardian or legalrepresentative. The naming of a Designated Beneficiary does not constitute atransfer.*

 

*8.**              **Exerciseof Option After Termination of Employment**.  If the Optionholder’s status as an employeeor consultant of (a) the Company, (b) an Affiliate, or (c) acorporation (or parent or subsidiary corporation of such corporation) issuingor assuming a stock option in a transaction to which section 424(a) ofthe Code applies, is terminated for any reason other than by disability (withinthe meaning of section 22(e)(3) of the Code) or death, theOptionholder may exercise the rights which were available to the Optionholderat the time of such termination only within three months following the date oftermination.  If such status isterminated as a result of disability, such rights may be exercised within oneyear from the date of termination.  Uponthe death of the Optionholder, his or her Designated Beneficiary shall have theright, at any time within one year after the date of death, to exercise inwhole or in part any rights that were available to the Optionholder at the timeof death.  Notwithstanding the foregoing,no rights under this Option may be exercised after the Expiration Date.  The aforesaid three-month and one-year periodsmay be extended by the Committee in its sole discretion up to the ExpirationDate of the option.  If an Optionholder’semployment relationship with the Company or any Affiliate is terminated forcause (as defined by the Committee in its sole discretion), all suchOptionholder’s options shall terminate immediately and be of no further forceor effect.  Whether authorized leaves ofabsence or absence on military or governmental service may constitutetermination for purposes of the Plan shall be conclusively determined by theCommittee.  Nothing in the Plan or in anyoption granted thereunder shall be deemed to give the Optionholder the right tocontinue his or her employment with the Company or any of its Affiliates orshall be deemed to interfere in any way with the right of the Company toterminate any Optionholder’s employment relationship at any time and for anyreason.  Options granted under the Planshall not be affected by any change of employment among the Company and itsAffiliates so long as the Optionholder continues to have an employmentrelationship with the Company or one of its Affiliates.*

 

*9.**              **Compliancewith Securities Laws**.  Itshall be a condition to the Optionholder’s right to purchase shares of CommonStock hereunder that the Company may, in its discretion, require (a) thatthe shares of Common Stock reserved for issue upon the exercise of this Optionshall have been duly listed, upon official notice of issuance, upon anynational securities exchange or automated quotation system on which the Company’sCommon Stock may then be listed or quoted, (b) that either (i) aregistration statement under the Securities Act of 1933 with respect to theshares shall be in effect, or (ii) in the opinion of counsel for theCompany, the proposed purchase shall be exempt from registration under that Actand the Optionholder shall have made such undertakings and agreements with theCompany as the Company may reasonably require, and (c) that such othersteps, if any, as counsel for the Company shall consider necessary to complywith any law applicable to the issue of such shares by the Company shall havebeen taken by the Company or the Optionholder, or both.  The certificates representing the sharespurchased under this Option may contain such legends as counsel for the Companyshall consider necessary to comply with any applicable law.*

 

*10.**       **Paymentof Taxes**.  TheOptionholder shall pay to the Company, or make provision satisfactory to theCompany for payment of, any taxes required by law to be withheld with respectto the exercise of this Option.  TheCommittee may, in its discretion, require or permit any other federal or statetaxes imposed on the Optionholder on the exercise of this option or the sale ofthe shares to be paid by the Optionholder. In the Committee’s discretion, such tax obligations may be paid in wholeor in part in shares of Common Stock, including shares retained from theexercise of this Option, valued at their Fair Market Value on the date ofdelivery.  The Company and its Affiliatesmay, to the extent permitted by law, deduct any such tax obligations from anypayment of any kind otherwise due to the Optionholder.*

 

*Adopted 05/24/2005*

 

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