Document:

Warrant to Purchase Common Stock

 Exhibit 10.2 
 THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED. 
 Issue Date: October 2, 2006 
 AKESIS PHARMACEUTICALS, INC. 
 WARRANT TO PURCHASE COMMON STOCK 
 This Warrant to Purchase Common Stock (the “Warrant”) is issued to Edward Wilson (the “Holder”) by Akesis Pharmaceuticals, Inc., a Nevada corporation (the “Company”),
pursuant to the terms of that certain Severance Agreement and Release (the “Release”) dated as of October 2, 2006 between the Company and the Holder. 
 1. Purchase of Shares. Subject to the terms and conditions hereinafter set forth and set forth in the Release, in consideration of the aggregate
payment of $2,500 by the Holder to the Company, the Holder of this Warrant is entitled during the Exercise Period, upon surrender of this Warrant at the principal office of the Company (or at such other place as the Company shall notify the Holder
hereof in writing), to purchase, in whole or in part, from the Company 250,000 fully paid and nonassessable Shares, at an exercise price per share equal to the Exercise Price (as defined below). 
 2. Definitions. 
 (a)
“Act” shall mean the Securities Act of 1933, as amended. 
 (b) “Exercise
Price” shall mean $0.86, the 10-day trailing average closing price of the Company’s Common Stock as reported on the Over-The-Counter Bulletin Board on October 2, the date of grant by the Board of Directors of the Company.

 (c) “Exercise Period” shall mean the term commencing on the date of issuance of this Warrant and
ending on the expiration of this Warrant pursuant to Section 14 hereof. 
 (d) “Shares” shall
mean shares of the Company’s Common Stock. 
 (e) “Change of Control” shall mean (i) a sale,
lease or disposition of all or substantially all of the assets of the Company, or (ii) a merger or consolidation (in a single transaction or a series of related transactions) of the Company with or into any other corporation or corporations or
other entity, or any other corporate reorganization, where the stockholders of the Company immediately prior to such event do not retain more than fifty percent (50%) of the 

 
voting power of and interest in the successor entity (excluding any transactions if the primary purpose of the transaction is to obtain financing from new or
existing investors). 
 3. Method of Exercise. While this Warrant remains outstanding and exercisable in accordance with
Section 1 above, the Holder may exercise, in whole or in part, the purchase rights evidenced hereby. Such exercise shall be effected by: 
 (a) the surrender of the Warrant, together with a notice of exercise to the Secretary of the Company at its principal offices; and 
 (b) the payment to the Company of an amount equal to the aggregate Exercise Price for the number of Shares being purchased. 
 4. Net Exercise. In lieu of cash exercising this Warrant, the Holder of this Warrant may elect to receive shares equal to the value of this
Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Company together with notice of such election, in which event the Company shall issue to the Holder hereof a number of Shares computed using
the following formula: 
                 Y (A- B)

 X =             A 
 Where 
 X — The number of Shares to be
issued to the Holder of this Warrant. 
 Y — The number of Shares purchasable under this Warrant. 
 A — The fair market value of one Share. 
 B — The Exercise Price (as adjusted to the date of such calculations). 
 For purposes of this Section 4, the fair market
value of a Share shall mean the average of the closing bid and asked prices of Shares quoted in the over-the-counter market in which the Shares are traded or the closing price quoted on any exchange on which the Shares are listed, whichever is
applicable, as published in the Western Edition of The Wall Street Journal for the ten (10) trading days prior to the date of determination of fair market value (or such shorter period of time during which such stock was traded
over-the-counter or on such exchange). If the Shares are not traded on the over-the-counter market or on an exchange, the fair market value shall be the price per Share that the Company could obtain from a willing buyer for Shares sold by the
Company from authorized but unissued Shares, as such prices shall be determined in good faith by the Company’s Board of Directors. 
 5.
Certificates for Shares. Upon the exercise of the purchase rights evidenced by this Warrant, one or more certificates for the number of Shares so purchased shall be issued as soon as practicable thereafter, and in any event within thirty
(30) days of the delivery of the subscription notice. 
  

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 6. Issuance of Shares. The Company covenants that the Shares, when issued pursuant to the exercise
of this Warrant, will be duly and validly issued, fully paid and nonassessable and free from all taxes, liens, and charges with respect to the issuance thereof. 
 7. Adjustment of Exercise Price and Number of Shares. The number of and kind of securities purchasable upon exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time as
follows: 
 (a) Subdivisions, Combinations and Other Issuances. If the Company shall at any time prior to the
expiration of this Warrant subdivide the Shares, by split-up or otherwise, or combine its Shares, or issue additional shares of its Shares as a dividend, the number of Shares issuable on the exercise of this Warrant shall forthwith be
proportionately increased in the case of a subdivision or stock dividend, or proportionately decreased in the case of a combination. Appropriate adjustments shall also be made to the purchase price payable per share, but the aggregate purchase price
payable for the total number of Shares purchasable under this Warrant (as adjusted) shall remain the same. Any adjustment under this Section 7(a) shall become effective at the close of business on the date the subdivision or combination becomes
effective, or as of the record date of such dividend, or in the event that no record date is fixed, upon the making of such dividend. 
 (b) Reclassification, Reorganization and Consolidation. In case of any reclassification, capital reorganization, or change in the capital stock of the Company (other than as a result of a subdivision,
combination, or stock dividend provided for in Section 7(a) above), then the Company shall make appropriate provision so that the Holder of this Warrant shall have the right at any time prior to the expiration of this Warrant to purchase, at a
total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities and property receivable in connection with such reclassification, reorganization, or change by a Holder of the same
number of Shares as were purchasable by the Holder of this Warrant immediately prior to such reclassification, reorganization, or change. In any such case appropriate provisions shall be made with respect to the rights and interest of the Holder of
this Warrant so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise hereof, and appropriate adjustments shall be made to the purchase price per
share payable hereunder, provided the aggregate purchase price shall remain the same. 
 (c) Notice of Adjustment. When
any adjustment is required to be made in the number or kind of shares purchasable upon exercise of the Warrant, or in the Exercise Price, the Company shall promptly notify the Holder of such event and of the number of Shares or other securities or
property thereafter purchasable upon exercise of this Warrant. 
 8. No Fractional Shares or Scrip. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of this Warrant, but in lieu of such fractional shares the Company shall make a cash payment therefor on the basis of the Exercise Price then in effect. 
  

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 9. Representations of the Company. The Company represents that all corporate actions on the part
of the Company, its officers, directors and stockholders necessary for the sale and issuance of this Warrant have been taken. 
 10.
Holder Representations. 
 (a) No Registration. The Holder understands that the Warrant and the Shares issuable upon
exercise hereof (the “Securities”) have not been, and will not be, registered under the Securities Act of 1933, as amended (the “Securities Act”) by reason of a specific exemption from the registration
provisions of the Securities Act, the availability of which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Holder’s representations as expressed herein or otherwise made pursuant hereto.

 (b) Investment Intent. The Holder is acquiring the Securities for investment for its own account, not as a nominee or
agent, and not with the view to, or for resale in connection with, any distribution thereof. 
 (c) Investment Experience. The
Holder has substantial experience in evaluating and investing in private placement transactions of securities in companies similar to the Company and acknowledges that such Holder can protect its own interests. Such Holder has such knowledge and
experience in financial and business matters so that such Holder is capable of evaluating the merits and risks of its investment in the Company. 
 (d) Speculative Nature of Investment. The Holder understands and acknowledges that the Company has a limited financial and operating history and that an investment in the Company is highly speculative and involves
substantial risks. Such Holder can bear the economic risk of such Holder’s investment and is able, without impairing such Holder’s financial condition, to hold the Securities for an indefinite period of time and to suffer a complete loss
of such Holder’s investment. Access to Data. The Holder has had an opportunity to discuss the Company’s business, management and financial affairs with the Company’s management. The Holder has also had an opportunity to ask questions
of officers of the Company, which questions were answered to its satisfaction. The Holder understands that such discussions, as well as any information issued by the Company, were intended to describe certain aspects of the Company’s business
and prospects, but were not necessarily a thorough or exhaustive description. The Holder acknowledges that any business plans prepared by the Company have been, and continue to be, subject to change and that any projections included in such business
plans or otherwise are necessarily speculative in nature, and it can be expected that some or all of the assumptions underlying the projections will not materialize or will vary significantly from actual results.  
 11. Restrictive Legend. The Shares (unless registered under the Act) shall be stamped or imprinted with a legend in substantially the following
form: 
 THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE
OR DISTRIBUTION THEREOF, AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER THE ACT AND ANY APPLICABLE STATE
SECURITIES LAWS. COPIES OF THE AGREEMENT COVERING THE PURCHASE OF THESE SHARES AND RESTRICTING THEIR TRANSFER MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE SECRETARY OF THE COMPANY AT THE
PRINCIPAL EXECUTIVE OFFICES OF THE COMPANY. 
  

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 12. Rights of Stockholders. No holder of this Warrant shall be entitled, as a Warrant holder, to
vote or receive dividends or be deemed the holder of the Shares or any other securities of the Company which may at any time be issuable on the exercise hereof for any purpose, nor shall anything contained herein be construed to confer upon the
Holder of this Warrant, as such, any of the rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any
corporate action (whether upon any recapitalization, issuance of stock, reclassification of stock, change of par value, consolidation, merger, conveyance, or otherwise) or to receive notice of meetings, or to receive dividends or subscription rights
or otherwise until the Warrant shall have been exercised and the Shares purchasable upon the exercise hereof shall have become deliverable, as provided herein. 
 13. Expiration of Warrant; Notice of Certain Events Terminating This Warrant. 
 (a)
This Warrant shall expire and shall no longer be exercisable upon the earliest to occur of: 
 (i) 5:00 p.m., California
local time, on the date of the third anniversary of the Issue Date set forth above; or 
 (ii) Any Change of Control.

 (b) The Company shall provide at least ten (10) days prior written notice of any event set forth in
Section 13(a)(ii). 
 14. Notices. All notices and other communications required or permitted hereunder shall be in writing,
shall be effective when given, and shall in any event be deemed to be given upon receipt or, if earlier, (a) five (5) days after deposit with the U.S. Postal Service or other applicable postal service, if delivered by first class mail,
postage prepaid, (b) upon delivery, if delivered by hand, (c) one business day after the business day of deposit with Federal Express or similar overnight courier, freight prepaid or (d) one business day after the business day of
facsimile transmission, if delivered by facsimile transmission with copy by first class mail, postage prepaid, and shall be addressed (i) if to the Holder, at the Holder’s address as set forth in 

  

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the Company’s records, and (ii) if to the Company, at the address of its principal corporate offices (attention: President), or at such other
address as a party may designate by ten days advance written notice to the other party pursuant to the provisions above. 
 15. Governing
Law. This Warrant and all actions arising out of or in connection with this Agreement shall be governed by and construed in accordance with the laws of the State of California, without regard to the conflicts of law provisions of the State of
California or of any other state. 
 16. Rights and Obligations Survive Exercise of Warrant. Unless otherwise provided herein, the
rights and obligations of the Company, of the Holder of this Warrant and of the holder of the Shares issued upon exercise of this Warrant, shall survive the exercise of this Warrant. 
 [Remainder of page intentionally left blank.] 
  

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 This Warrant to Purchase Common Stock is issued as of the date first set forth above. 
  

			
	AKESIS PHARMACEUTICALS, INC.
		
	 By:
	 	/s/ Kevin Kinsella
		 	 Kevin Kinsella, Director

 EXHIBIT A 
 NOTICE OF EXERCISE 
  

	TO:	Akesis Pharmaceuticals, Inc. 

 Attention: President

 1. The undersigned hereby elects to purchase __________ Shares of Common Stock of Akesis Pharmaceuticals, Inc. pursuant to the terms of
the attached Warrant. 
 2. Method of Exercise (Please initial the applicable blank): 
  

	 	___	The undersigned elects to exercise the attached Warrant by means of a cash payment, and tenders herewith payment in full for the purchase price of the shares being purchased,
together with all applicable transfer taxes, if any. 

  

	 	___	The undersigned elects to exercise the attached Warrant by means of the net exercise provisions of Section 4 of the Warrant. 

 3. Please issue a certificate or certificates representing said Shares in the name of the undersigned or in such other name as is specified below:

 ____________________ 
 (Name)

 ____________________ 
 ____________________ 
 (Address) 
 4. The undersigned hereby represents and warrants that the aforesaid Shares are being acquired for the account of the undersigned for investment and not with a view to, or for resale, in connection with the
distribution thereof, and that the undersigned has no present intention of distributing or reselling such shares and all representations and warranties of the undersigned set forth in the Warrant are true and correct as of the date hereof.

  

									
			
		 		 	  
		 		 	(Signature)
			
		 		 	  
		 		 	(Name)
			
	  	 		 	  
	(Date)	 		 	(Title)Form of Stand-Alone Stock Option Agreement

 Exhibit 10.3 
 AKESIS PHARMACEUTICALS, INC. 
 FORM OF 
 STAND-ALONE STOCK OPTION AGREEMENT 
  

	I.	NOTICE OF STOCK OPTION GRANT 

 Name:

 Address: 
 You have
been granted a Nonstatutory Stock Option to purchase Common Stock of the Company, subject to the terms and conditions of this Agreement, as follows: 
  

			
	 Date of Grant
	  	____________________________________
		
	 Vesting Commencement Date
	  	____________________________________
		
	 Exercise Price per Share
	  	____________________________________
		
	 Total Number of Shares Granted
	  	____________________________________
		
	 Total Exercise Price
	  	____________________________________
		
	 Term/Expiration Date:
	  	____________________________________

 Vesting Schedule: 
 This Option will vest and may be exercised, in whole or in part, in accordance with the following schedule: 
 1/36th of the Shares subject to the Option will vest each month following the Vesting Commencement Date, so that the Option will be fully vested three
(3) years from the Vesting Commencement Date, subject to the Optionee continuing to be a Service Provider on such dates. 
 Notwithstanding the foregoing, 100% of the Shares subject to this Option will fully vest and become exercisable upon a Change of Control. For purposes herein, “Change of Control” means the occurrence of any of
the following events: (i) the consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets; (ii) the consummation of a merger or consolidation of the Company with any other corporation,
other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the
surviving entity or its parent) at least fifty percent (50%) of the total voting power represented by the voting securities of the Company or such surviving entity or its parent outstanding immediately after such merger or consolidation
(provided that the sale by the Company of its 

 
securities for the purposes of raising additional funds shall not constitute a Change of Control hereunder); or (iii) the consummation of the sale or
disposition by the Company for aggregate gross proceeds to the Company of no less than $50,000,000 of (a) one of the two issued RX patents held by the Company as of the date hereof, or (b) the pending RX patent held by the Company as of
the date hereof, as approved by the Company’s board of directors. 
 Termination Period 
 Subject to the provisions of Section 10(c) of the Agreement, this Option may be exercised for three (3) months after Optionee ceases to be a
Service Provider in accordance with Section 7 of this Agreement. Upon the death or Disability of the Optionee, this Option may be exercised for one (1) year after the Optionee ceases to be a Service Provider in accordance with Sections 8
and 9 of this Agreement. In no event will this Option be exercised later than the Term/Expiration Date provided above. 
  

	II.	AGREEMENT 

 1. Definitions. As used
herein, the following definitions will apply: 
 (a) “Agreement” means this stock option agreement between
the Company and Optionee evidencing the terms and conditions of this Option. 
 (b) “Applicable Laws” means
the requirements relating to the administration of stock options under U.S. state corporate laws, U.S. federal and state securities laws, the Code, any stock exchange or quotation system on which the Common Stock is listed or quoted and the
applicable laws of any foreign country or jurisdiction that may apply to this Option. 
 (c) “Board” means
the Board of Directors of the Company or any committee of the Board that has been designated by the Board to administer this Agreement. 
 (d) “Change of Control” means the occurrence of any of the following events: 
 (1) any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) becoming the “beneficial owner” (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing fifty percent (50%) or more of the total voting power represented by the Company’s then outstanding voting securities; 
 (2) the approval by the stockholders of the Company of a plan of complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Company’s assets; 
 (3) the approval by stockholders of
the Company of a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either
by remaining outstanding or by being converted into voting securities of the surviving entity) more than fifty percent (50%) of the total voting power represented by the 

  

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voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation. 
 (e) “Code” means the Internal Revenue Code of 1986, as amended. 
 (f) “Common Stock” means the common stock of the Company. 
 (g) “Company” means Akesis Pharmaceuticals, Inc., a Nevada corporation. 
 (h) “Consultant” means any person, including an advisor, engaged by the Company or a Parent or Subsidiary to render
services to such entity. 
 (i) “Director” means a member of the Board. 
 (j) “Disability” means total and permanent disability as defined in Section 22(e)(3) of the Code. 
 (k) “Employee” means any person, including Officers and Directors, employed by the Company or any Parent or Subsidiary of
the Company. An Employee will not cease to be such in the case of (i) any leave of absence approved by the Company or (ii) transfers between locations of the Company or between the Company, its Parent, any Subsidiary, or any successor.
Neither service as a Director nor payment of a director’s fee by the Company will be sufficient to constitute “employment” by the Company. 
 (l) “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
 (m) “Fair Market Value” means, as of any date, the value of Common Stock determined as follows: 
 (1) If the Common Stock is listed on any established stock exchange or a national market system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Value will be
the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or system on the day of determination, as reported in The Wall Street Journal or such other source as the Administrator deems
reliable; 
 (2) If the Common Stock is regularly quoted by a recognized securities dealer but selling prices are not
reported, its Fair Market Value will be the mean between the high bid and low asked prices for the Common Stock on the day of determination; or 
 (3) In the absence of an established market for the Common Stock, the Fair Market Value thereof will be determined in good faith by the Board. 
 (n) “Nonstatutory Stock Option” means an Option not intended to qualify as an incentive stock option within the meaning
of Section 422 of the Code and the regulations promulgated thereunder. 
  

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 (o) “Notice of Grant” means a written notice, in Part I of this
Agreement, evidencing certain terms and conditions of this Option grant. The Notice of Grant is part of the Option Agreement. 
 (p) “Officer” means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder. 
 (q) “Option” means this stock option. 
 (r) “Optioned Stock” means the Common Stock subject to this Option. 
 (s) “Optionee” means the person named in the Notice of Stock Option Grant or such person’s successor. 
 (t) “Parent” means a “parent corporation,” whether now or hereafter existing, as defined in Section 424(e)
of the Code. 
 (u) “Service Provider” means an Employee, Director or Consultant. 
 (v) “Share” means a share of the Common Stock, as adjusted in accordance with Section 11 of this Agreement.

 (w) “Subsidiary” means a “subsidiary corporation”, whether now or hereafter existing, as defined
in Section 424(f) of the Code. 
 2. Grant of Option. The Board hereby grants to the Optionee named in the Notice of Grant
attached as Part I of this Agreement the Option to purchase the number of Shares, as set forth in the Notice of Grant, at the exercise price per share set forth in the Notice of Grant (the “Exercise Price”), subject to the terms and
conditions of this Agreement. 
 3. Exercise of Option. 
 (a) Right to Exercise. This Option is exercisable during its term in accordance with the Vesting Schedule set out in the Notice of
Grant and the applicable provisions of this Agreement. 
 (b) Method of Exercise. This Option is exercisable by
delivery of an exercise notice, in the form attached as Exhibit A (the “Exercise Notice”), which will state the election to exercise the Option, the number of Shares in respect of which the Option is being exercised (the
“Exercised Shares”), and such other representations and agreements as may be required by the Company. The Exercise Notice will be completed by the Optionee and delivered to the Human Resources Specialist of the Company or such other person
as the Company may designate. The Exercise Notice will be accompanied by payment of the aggregate Exercise Price as to all Exercised Shares. This Option will be deemed to be exercised upon receipt by the Company of such fully executed Exercise
Notice accompanied by such aggregate Exercise Price. 
 (c) Legal Compliance. No Shares will be issued pursuant to the
exercise of this Option unless such issuance and exercise comply with Applicable Laws. Assuming such 

  

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compliance, for income tax purposes the Exercised Shares will be considered transferred to the Optionee on the date the Option is exercised with respect to
such Exercised Shares. 
 4. Method of Payment. Payment of the aggregate Exercise Price will be by any of the following, or a
combination thereof, at the election of the Optionee: 
 (a) cash or check; or, 
 (b) with the Board’s consent, consideration received by the Company under a cashless exercise program implemented by the Company.

 5. Non-Transferability of Option. This Option may not be transferred in any manner otherwise than by will or by the laws of descent
or distribution and may be exercised during the lifetime of Optionee only by the Optionee. The terms of this Agreement will be binding upon the executors, administrators, heirs, successors and assigns of the Optionee. 
 6. Term of Option. This Option may be exercised only within the term set out in the Notice of Grant, and may be exercised during such term only in
accordance with the terms of this Agreement. 
 7. Termination of Relationship as a Service Provider. If the Optionee ceases to be a
Service Provider (other than for death or Disability), this Option may be exercised for a period of three (3) months after the date of such termination (but in no event later than the expiration date of this Option as set forth in the Notice of
Grant) to the extent that the Option is vested on the date of such termination. To the extent that the Optionee does not exercise this Option within the time specified herein, the Option will terminate. 
 8. Disability of Optionee. If the Optionee ceases to be a Service Provider as a result of the Optionee’s Disability, this Option may be
exercised for a period of twelve (12) months after the date of such termination (but in no event later than the expiration date of this Option as set forth in the Notice of Grant) to the extent that the Option is vested on the date of such
termination. To the extent that Optionee does not exercise this Option within the time specified herein, the Option will terminate. 
 9.
Death of Optionee. If the Optionee dies while a Service Provider, the Option may be exercised at any time within twelve (12) months following the date of death (but in no event later than the expiration date of this Option as set forth
in the Notice of Grant), by the Optionee’s estate or by a person who acquired the right to exercise the Option by bequest or inheritance, but only to the extent that the Optionee was entitled to exercise the Option at the date of death. If,
after death, the Optionee’s estate or a person who acquired the right to exercise the Option by bequest or inheritance does not exercise the Option within the time specified herein, the Option will terminate. 
 10. Adjustments Upon Changes in Capitalization, Dissolution, Merger or Asset Sale. 
 (a) Adjustments. In the event that any dividend or other distribution (whether in the form of cash, Shares, other securities, or
other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or exchange of Shares or other securities of the Company, or other change in the corporate
structure of 

  

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the Company affecting the Shares occurs, the Board, in order to prevent diminution or enlargement of the benefits or potential benefits intended to be made
available under this Option, may (in its sole discretion) adjust the number, class, and Exercise Price of Shares covered by this Option. 
 (b) Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Board will notify Optionee as soon as practicable prior to the effective date of such proposed
transaction. To the extent it has not been previously exercised, the Option will terminate immediately prior to the consummation of such proposed 
 (c) Change of Control. In the event of a Change of Control, the Option will be assumed or an equivalent option substituted by the successor corporation or a Parent or Subsidiary of the successor corporation. In
the event that the successor corporation refuses to assume or substitute for the Option, the Optionee will fully vest in and have the right to exercise the Option as to all of the Optioned Stock, including Shares as to which it would not otherwise
be vested or exercisable. If the Option becomes fully vested and exercisable in lieu of assumption or substitution in the event of a Change of Control, the Board will notify the Optionee in writing or electronically that the Option will be fully
exercisable for a period of time determined by the Board, and the Option will terminate upon the expiration of such period. For the purposes of this paragraph, the Option will be considered assumed if, following the Change of Control, the option
confers the right to purchase or receive, for each Share subject to the Option immediately prior to the Change of Control, the consideration (whether stock, cash, or other securities or property) received in the Change of Control by holders of
Common Stock for each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if
such consideration received in the Change of Control is not solely common stock of the successor corporation or its Parent, the Board may, with the consent of the successor corporation, provide for the consideration to be received upon the exercise
of the Option, for each Share subject to the Option, to be solely common stock of the successor corporation or its Parent equal in fair market value to the per share consideration received by holders of Common Stock in the Change of Control.

 11. Notices. Any notice to be given to the Company hereunder will be in writing and will be addressed to the Company at its then
current principal executive office or to such other address as the Company may hereafter designate to the Optionee by notice as provided in this Section. Any notice to be given to the Optionee hereunder will be addressed to the Optionee at the
address set forth beneath his signature hereto, or at such other address as the Optionee may hereafter designate to the Company by notice as provided herein. A notice will be deemed to have been duly given when personally delivered or mailed by
registered or certified mail to the party entitled to receive it. 
 12. Withholding Taxes. Optionee agrees to make appropriate
arrangements with the Company (or the Parent or Subsidiary employing or retaining Optionee) for the satisfaction of all Federal, state, and local income and employment tax withholding requirements applicable to the Option exercise. Optionee
acknowledges and agrees that the Company may refuse to honor the exercise and refuse to deliver Shares if such withholding amounts are not delivered at the time of exercise. 
 13. Entire Agreement; Governing Law. This Agreement and the ____________ entered into between Optionee and the Company and dated
___________________ constitutes the entire 

  

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agreement of the parties with respect to the subject matter hereof and supersedes in their entirety all prior undertakings and agreements of the Company and
Optionee with respect to the subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing signed by the Company and Optionee. This agreement is governed by the internal substantive laws, but
not the choice of law rules, of California. 
 14. NO GUARANTEE OF CONTINUED SERVICE. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE
VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (AND NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES HEREUNDER). OPTIONEE
FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING
PERIOD, FOR ANY PERIOD, OR AT ALL, AND WILL NOT INTERFERE WITH OPTIONEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE OPTIONEE’S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE. 
 By Optionee’s signature and the signature of the Company’s representative below, Optionee and the Company agree that this Option is granted
under and governed by the terms and conditions of this Agreement. Optionee has reviewed this Agreement in its entirety, has had an opportunity to obtain the advice of counsel prior to executing this Agreement and fully understands all provisions of
this Agreement. Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Board upon any questions relating to this Agreement. Optionee further agrees to notify the Company upon any change in the
residence address indicated below. 
  

									
	 OPTIONEE
	 		 	 AKESIS PHARMACEUTICALS, INC.

			
	  	 		 	  
	Signature	 		 	By
			
	  	 		 	  
	Print Name	 		 	 Title

			
	  	 		 	
	 Residence Address
	 		 	
			
	  	 		 	
			
	  	 		 	

  

 -7- 

 EXHIBIT A 
 AKESIS PHARMACEUTICALS, INC. 
 EXERCISE NOTICE 
 Akesis Pharmaceuticals, Inc. 
 888 Prospect St. #320 
 La Jolla, California 92037 
  

	Attention:	President 

 1. Exercise of Option. Effective as of
today, ________________, 20__, the undersigned (“Purchaser”) hereby elects to purchase ______________ shares (the “Shares”) of the Common Stock of Akesis Pharmaceuticals, Inc. (the “Company”) under the option (the
“Option”) represented by the Stock Option Agreement dated ____________ (the “Option Agreement”). 
 2. Delivery of
Payment. Purchaser herewith delivers to the Company the full purchase price for the Shares together with any required withholding taxes to be paid in connection with the exercise of the Option. 
 3. Representations of Purchaser. Purchaser acknowledges that Purchaser has received, read and understood the Option Agreement and agrees to abide
by and be bound by its terms and conditions. 
 4. Rights as Shareholder. Until the issuance (as evidenced by the appropriate entry on
the books of the Company or of a duly authorized transfer agent of the Company) of the Shares, no right to vote or receive dividends or any other rights as a stockholder will exist with respect to the Optioned Stock, notwithstanding the exercise of
the Option. The Shares so acquired will be issued to the Purchaser as soon as practicable after exercise of the Option. No adjustment will be made for a dividend or other right for which the record date is prior to the date of issuance, except as
provided in Section 11 of the Option Agreement. 
 5. Tax Consultation. Purchaser understands that Purchaser may suffer adverse
tax consequences as a result of Purchaser’s purchase or disposition of the Shares. Purchaser represents that Purchaser has consulted with any tax consultants Purchaser deems advisable in connection with the purchase or disposition of the Shares
and that Purchaser is not relying on the Company for any tax advice. 
 6. Successors and Assigns. The Company may assign any of its
rights under this Exercise Notice to single or multiple assignees, and this Exercise Notice will inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Exercise Notice will
be binding upon the Purchaser and his or her heirs, executors, administrators, successors and assigns. 
 7. Interpretation. Any
dispute regarding the interpretation of this Exercise Notice will be submitted by the Purchaser or by the Company forthwith to the Board, which will review such 

 
dispute at its next regular meeting. The resolution of such a dispute by the Board will be final and binding on all parties. 
 8 Entire Agreement; Governing Law. The Option Agreement is incorporated herein by reference together with any documents incorporated by reference
therein. This Agreement, and the Option Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Purchaser with
respect to the subject matter hereof, and may not be modified adversely to the Purchaser’s interest except by means of a writing signed by the Company and Purchaser. This agreement is governed by the internal substantive laws, but not the
choice of law rules, of California. 
  

					
	Submitted by:	 		 	Accepted by:
			
	OPTIONEE	 		 	AKESIS PHARMACEUTICALS, INC.
			
	   	 		 	   
	Signature	 		 	
			
	   	 		 	   
	Print Name	 		 	
			
	   	 		 	   
	Address	 		 	Address
	   	 		 	 888 Prospect St. #320
 La Jolla, California
92037

	  	 		 
			
		 		 	 Date Received: ____________________

  

 -2-

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