EX-10.2



 Exhibit 10.2 
 LIPOCINE INC. 
 2011 EQUITY
INCENTIVE PLAN 
 OPTION AGREEMENT 

(INCENTIVE STOCK OPTION OR NONSTATUTORY STOCK
OPTION) 
 Pursuant to your Stock Option Grant Notice (“Grant Notice”) and this
Option Agreement, Lipocine Inc. (the “Company”) has granted you an option under its 2011 Equity Incentive 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”), you may not exercise your
option until you have completed at least six (6) months of Continuous Service measured from the Date of Grant 
 4.
EXERCISE PRIOR TO VESTING (“EARLY EXERCISE”). If permitted in your Grant Notice (i.e., the “Exercise Schedule” indicates
“Early Exercise Permitted”) and subject to the provisions of your option, you may elect at any time that is both (i) during the period of your Continuous Service and (ii) during the term of your option, to exercise all or part of
your option, including the unvested portion of your option; provided, however, that: 
 (a) a partial exercise of
your option shall be deemed to cover first vested shares of Common Stock and then the earliest vesting installment of unvested shares of Common Stock; 
 (b) any shares of Common Stock so purchased from installments that have not vested as of the date of exercise shall be subject to the purchase option in favor of the Company as described in the
Company’s form of Early Exercise Stock Purchase Agreement; 
 (c) you shall enter into the Company’s form of
Early Exercise Stock Purchase Agreement with a vesting schedule that will result in the same vesting as if no early exercise had occurred; and 

  
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 (d) if your option is an Incentive Stock Option, then, to the extent that the
aggregate Fair Market Value (determined at the time of grant) of the shares of Common Stock with respect to which your option plus all other Incentive Stock Options you hold are exercisable for the first time by you during any calendar year (under
all plans of the Company and its Affiliates) exceeds one hundred thousand dollars ($100,000), your option(s) or portions thereof that exceed such limit (according to the order in which they were granted) shall be treated as Nonstatutory Stock
Options. 
 5. 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 any other manner permitted by your Grant Notice, which may include one or more of the following:

 (a) Provided that at the time of exercise the Common Stock is publicly traded and quoted regularly in The Wall
Street Journal, 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 and quoted regularly in The Wall Street Journal, 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. 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. 
 6. WHOLE SHARES. You may exercise your option only for whole shares of Common Stock. 
 7. 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. 
 8. 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 upon the earliest of the following: 
 (a) Immediately upon the termination of your Continuous Service for Cause; 

  
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 (b) Three (3) months after the termination of your Continuous Service for any
reason other than your Disability or death, provided that if during any part of such three (3) month period your option is not exercisable solely because of the condition set forth in the section above 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 (3) months after the termination of your Continuous Service; 

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

(d) twelve (12) months after your death if you die either during your Continuous Service or within three (3) months
after your Continuous Service terminates; 
 (e) the Expiration Date indicated in your Grant Notice; or 

(f) the day before the tenth (10th) anniversary of the Date of Grant. 

If your option is an Incentive Stock Option, note that to obtain the federal income tax advantages associated with an Incentive Stock
Option, the Code requires that at all times beginning on the date of grant of your option and ending on the day three (3) months before the date of your option’s exercise, you must be an employee of the Company or an Affiliate, except in
the event of your death or Disability. The Company has provided for extended exercisability of your option under certain circumstances for your benefit but cannot guarantee that your option will necessarily be treated as an Incentive Stock Option if
you continue to provide services to the Company or an Affiliate as a Consultant or Director after your employment terminates or if you otherwise exercise your option more than three (3) months after the date your employment with the Company or
an Affiliate terminates. 
 9. EXERCISE. 

(a) You may exercise the vested portion of your option (and the unvested portion of your option if your Grant Notice so permits)
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 (1) the exercise of your
option, (2) the lapse of any substantial risk of forfeiture to which the shares of Common Stock are subject at the time of exercise, or (3) the disposition of shares of Common Stock acquired upon such exercise. 

(c) If your option is an Incentive Stock Option, by exercising your option you agree that you will notify the Company in writing
within fifteen (15) days after the date of any disposition of any of the shares of the Common Stock issued upon exercise of your option that occurs within two (2) years after the date of your option grant or within one (1) year after
such shares of Common Stock are transferred upon exercise of your option. 

  
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 (d) By exercising your option you agree that you shall not sell, dispose of,
transfer, make any short sale of, grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a sale, any shares of Common Stock or other securities of the Company held by you, for a period
of one hundred eighty (180) days following the effective date of a registration statement of the Company filed under the Securities Act or such longer period as necessary to permit compliance with FINRA Rule 2711 or NYSE Member Rule 472 and
similar rules and regulations (the “Lock-Up Period”); provided, however, that nothing contained in this section shall prevent the exercise of a repurchase option, if any, in favor of the Company during the Lock-Up
Period. You further agree to execute and deliver such other agreements as may be reasonably requested by the Company and/or the underwriter(s) that are consistent with the foregoing or that are necessary to give further effect thereto. In order to
enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to your shares of Common Stock until the end of such period. The underwriters of the Company’s stock are intended third party beneficiaries of this
Section 9(d) and shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto. 
 10. TRANSFERABILITY. 
 (a) If your option is an
Incentive Stock Option, 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. 
 (b) If your option is a Nonstatutory Stock Option, your option is not transferable, except (i) by will or by the laws of descent and distribution, (ii) with the prior written approval of
the Company, by instrument to an inter vivos or testamentary trust, in a form accepted by the Company, in which the option is to be passed to beneficiaries upon the death of the trustor (settlor) and (iii) with the prior written approval of the
Company, by gift, in a form accepted by the Company, to a permitted transferee under Rule 701 of the Securities Act. 
 11.
RIGHT OF FIRST REFUSAL. 
 (a) Grant of Right of First
Refusal. Except as provided in Section 11(g) below, in the event you, your legal representative, or other holder of shares acquired upon exercise of your option proposes to sell, exchange, transfer, pledge, or otherwise dispose of any
shares acquired upon exercise of you option (the “Transfer Shares”) to any person or entity, including, without limitation, any shareholder of the Company, the Company shall have the right to repurchase the Transfer Shares
under the terms and subject to the conditions set forth in this Section 11 (the “Right of First Refusal”). 
 (b) Notice of Proposed Transfer. Prior to any proposed transfer of the Transfer Shares, you shall deliver written notice (the “Transfer Notice”) to the Company describing
fully the proposed transfer, including the number of Transfer Shares, the name and address of the proposed transferee (the “Proposed Transferee”) and, if the transfer is voluntary, the proposed transfer price, and containing
such information necessary to show the bona fide nature of the proposed transfer. In the event of a bona fide gift or involuntary transfer, the 

  
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proposed transfer price shall be deemed to be the Fair Market Value of the Transfer Shares, as determined by the Board in good faith. If you propose to transfer any Transfer Shares to more than
one Proposed Transferee, you shall provide a separate Transfer Notice for the proposed transfer to each Proposed Transferee. The Transfer Notice shall be signed by both you and the Proposed Transferee and must constitute a binding commitment of you
and the Proposed Transferee for the transfer of the Transfer Shares to the Proposed Transferee subject only to the Right of First Refusal. 
 (c) Bona Fide Transfer. If the Company determines that the information provided by you in the Transfer Notice is insufficient to establish the bona fide nature of a proposed voluntary transfer, the
Company shall give you written notice of your failure to comply with the procedure described in this Section 11, and you shall have no right to transfer the Transfer Shares without first complying with the procedure described in this
Section 11. You shall not be permitted to transfer the Transfer Shares if the proposed transfer is not bona fide. 
 (d)
Exercise of Right of First Refusal. If the Company determines the proposed transfer to be bona fide, the Company shall have the right to purchase all, but not less than all, of the Transfer Shares (except as the Company and you otherwise agree)
at the purchase price and on the terms set forth in the Transfer Notice by delivery to you of a notice of exercise of the Right of First Refusal within thirty (30) days after the date the Transfer Notice is delivered to the Company. The
Company’s exercise or failure to exercise the Right of First Refusal with respect to any proposed transfer described in a Transfer Notice shall not affect the Company’s right to exercise the Right of First Refusal with respect to any
proposed transfer described in any other Transfer Notice, whether or not such other Transfer Notice is issued by you or issued by a person other than you with respect to a proposed transfer to the same Proposed Transferee. If the Company exercises
the Right of First Refusal, the Company and you shall thereupon consummate the sale of the Transfer Shares to the Company on the terms set forth in the Transfer Notice within sixty (60) days after the date the Transfer Notice is delivered to
the Company (unless a longer period is offered by the Proposed Transferee); provided, however, that in the event the Transfer Notice provides for the payment for the Transfer Shares other than in cash, the Company shall have the option of paying for
the Transfer Shares by the present value cash equivalent of the consideration described in the Transfer Notice as reasonably determined by the Company. For purposes of the foregoing, cancellation of any indebtedness of yours to the Company shall be
treated as payment to you in cash to the extent of the unpaid principal and any accrued interest canceled. 
 (e) Failure to
Exercise Right of First Refusal. If the Company fails to exercise the Right of First Refusal in full (or to such lesser extent as the Company and you otherwise agree) within the period specified in Section 11(d) above, you may conclude a
transfer to the Proposed Transferee of the Transfer Shares on the terms and conditions described in the Transfer Notice, provided such transfer occurs not later than ninety (90) days following delivery to the Company of the Transfer Notice. The
Company shall have the right to demand further assurances from you and the Proposed Transferee (in a form satisfactory to the Company) that the transfer of the Transfer Shares was actually carried out on the terms and conditions described in the
Transfer Notice. No Transfer Shares shall be transferred on the books of the Company until the Company has received such assurances, if so demanded, and has approved the proposed 

  
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transfer as bona fide. Any proposed transfer on terms and conditions different from those described in the Transfer Notice, as well as any subsequent proposed transfer by you, shall again be
subject to the Right of First Refusal and shall require compliance by you with the procedure described in this Section 11. 

(f) Transferees of Transfer Shares. All transferees of the Transfer Shares or any interest therein, other than the Company, shall
be required as a condition of such transfer to agree in writing (in a form satisfactory to the Company) that such transferee shall receive and hold such Transfer Shares or interest therein subject to all of the terms and conditions of this Option
Agreement, including this Section 11 providing for the Right of First Refusal with respect to any subsequent transfer. Any sale or transfer of any shares acquired upon exercise of the Option shall be void unless the provisions of this
Section 11 are met. 
 (g) Transfers Not Subject to Right of First Refusal. The Right of First Refusal shall not
apply to any transfer or exchange of the shares acquired upon exercise of the Option if such transfer or exchange is in connection with a Corporate Transaction. If the consideration received pursuant to such transfer or exchange consists of stock of
an Affiliate, such consideration shall remain subject to the Right of First Refusal unless the provisions of Section 11(i) below result in a termination of the Right of First Refusal. 

(h) Assignment of Right of First Refusal. The Company shall have the right to assign the Right of First Refusal at any time,
whether or not there has been an attempted transfer, to one or more persons as may be selected by the Company. 
 (i) Early
Termination of Right of First Refusal. The other provisions of this Option Agreement notwithstanding, the Right of First Refusal shall terminate and be of no further force and effect upon (a) the occurrence of a Change in Control, unless
the surviving, continuing, successor, or other business entity or parent thereof, as the case may be (the “Acquiring Corporation”) assumes the Company’s rights and obligations under the Option or substitutes a
substantially equivalent option for the Acquiring Corporation’s stock for the Option, or (b) the existence of a public market for the class of shares subject to the Right of First Refusal. A “public market” shall be
deemed to exist if (i) such stock is listed on a national securities exchange (as that term is used in the Exchange Act) or (ii) such stock is traded on the over-the-counter market and prices therefor are published daily on business days
in a recognized financial journal. 
 12. RIGHT OF REPURCHASE. To the extent
provided in the Company’s bylaws in effect at such time the Company elects to exercise its right, the Company shall have the right to repurchase all or any part of the shares of Common Stock you acquire pursuant to the exercise of your option.

 13. 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 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. 

  
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 14. 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 of tax 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). If the date of determination of any tax withholding obligation is deferred to a date later than the date of exercise of your option, share withholding pursuant to the preceding sentence shall not be permitted unless you make a proper and
timely election under Section 83(b) of the Code, covering the aggregate number of shares of Common Stock acquired upon such exercise with respect to which such determination is otherwise deferred, to accelerate the determination of such tax
withholding obligation to the date of exercise of your option. Notwithstanding the filing of such election, shares of Common Stock shall be withheld solely from fully vested shares of Common Stock determined as of the date of exercise of your option
that are otherwise issuable to you upon such exercise. 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. 
 15. 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 and there is no other impermissible deferral of compensation associated
with the option. Because the Common Stock is not traded on an established securities market, the Fair Market Value is determined by the Board, perhaps in consultation with an independent valuation firm retained by the Company.


  
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You acknowledge that there is no guarantee that the Internal Revenue Service will agree with the valuation as determined by the Board, and you shall not make any claim against the Company, or any
of its Officers, Directors, Employees or Affiliates in the event that the Internal Revenue Service asserts that the valuation determined by the Board is less than the “fair market value” as subsequently determined by the Internal Revenue
Service. 
 16. 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. 
 17. 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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 LIPOCINE INC. 

STOCK OPTION GRANT NOTICE 

(2011 EQUITY INCENTIVE PLAN) 
 Lipocine Inc. (the “Company”), pursuant to its 2011 Equity Incentive 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:
	  	 ̈ Incentive Stock Option1	  	             ̈ Nonstatutory Stock Option
			
	 Exercise Schedule:        
	  	 ̈ Same as Vesting Schedule	  	             ̈ Early Exercise Permitted
		
	 Vesting Schedule:
	  	Twenty-five percent (25%) of the shares (rounded down to the nearest whole number of shares) vest on the first anniversary of the Vesting Commencement Date;
thereafter 1/48th of the shares vest in monthly
installments measured from the first anniversary of the Vesting Commencement Date.
		
	 Payment:
	  	By one or a combination of the following items (described in the Option Agreement):
		
		  	
 ̈      By cash or check

 ̈      Pursuant to a Regulation T
Program if the Shares are publicly traded

 ̈      By delivery of already-owned
shares if the Shares are publicly traded


 Additional Terms/Acknowledgements: The undersigned Optionholder acknowledges receipt of, and understands and
agrees to, this Stock Option Grant Notice, the Option Agreement and the Plan. Optionholder further acknowledges that as of the Date of Grant, this Stock 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) Stock Awards previously granted and delivered to Optionholder
under the Plan or the Company’s 2000 Stock Option Plan, and (ii) the following agreements only: 
  

			
	             OTHER
AGREEMENTS:
	  	 
		
		  	 

  
  

	1 	If this is an Incentive Stock Option, it (plus other outstanding Incentive Stock Options) cannot be first exercisable for more than $100,000 in value (measured
by exercise price) in any calendar year. Any excess over $100,000 is a Nonstatutory Stock Option. 


  
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	LIPOCINE INC.	 		 	OPTIONHOLDER:
				
	By:	 	 	 		 	 
		 	Signature	 		 		 	Signature
	Title:	 	 	 		 	Date:	 	 
		 		 		 		 	
	Date:	 	 	 		 		 	

 ATTACHMENTS:     Option Agreement, 2011 Equity Incentive Plan,
and Notice of Exercise 

  
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