Document:

Exhibit 10.6

FORM OF INCENTIVE STOCK OPTION AGREEMENT

Under the Emisphere Technologies, Inc.
2007 Stock Award and Incentive Plan

     THIS AGREEMENT dated as of the [DAY] day of [MONTH], 200[ ], between Emisphere Technologies, Inc., a Delaware Corporation (the “Company”), and [NAME] (the “Optionee”). 

W I T N E S S E T H: 

     In consideration of the mutual promises and covenants made herein and the mutual benefits to be derived herefrom, the parties hereto agree as follows: 

     1. Grant of Stock Option. 

     Subject to the provisions of this Agreement and to the provisions of the Emisphere Technologies, Inc. 2007 Stock Award and Incentive Plan (the “Plan”), the Company hereby grants to the Optionee as of [DATE] (the “Grant Date”) the right and option (the “Stock Option”) to purchase [NUMBER] shares of common stock of the Company, par value $.01 per share (“Common Stock”), at the exercise price of [$] per share, the closing price of the Common Stock on [DATE]. The Stock Option is intended to qualify as an Incentive Stock Option, within the meaning of Section 422 of the Internal Revenue Code, as amended (the “Code”).
Unless earlier terminated pursuant to the terms of this Agreement, the Stock Option shall expire on the tenth anniversary of the date hereof. Capitalized terms not defined herein shall have the meaning set forth in the Plan. 

     The Company cannot guarantee that the special tax treatment described in Section 422 of the Code will apply and may subject the Optionee to alternative minimum tax. The Optionee is advised to consult with his personal tax advisor to determine his or her respective tax consequences. For example, if the Optionee sells the Common Stock acquired pursuant to the exercise of the Stock Option either within two years after the date of this Agreement or within one year after the date the Stock Option (or any part thereof) is exercised, this special tax treatment will not apply. 

     If the Stock Option (or any part thereof) does not qualify for Incentive Stock Option treatment for any reason, then, to the extent of such nonqualification, the Stock Option (or such portion thereof) shall be treated as a Nonqualified Stock Option granted under the Plan, provided that the Stock Option (or such portion thereof) otherwise satisfies the terms and conditions of the Plan generally relating to Nonqualified Stock Options. 

     2. Exercisability of the Stock Option. 

     Subject to remaining employed by the Company through the following dates, the Stock Option shall become vested and exercisable with respect to:

	        	  Date  	% of Grant (or number of Shares) Vested  
		  [INSERT DATE]  	25%  
		  [INSERT DATE]  	25%  
		  [INSERT DATE]  	25%  
		  [INSERT DATE]  	25%  

Upon the Optionee’s termination of employment for any reason, the portion of the Stock Option that is not vested as of such date, in accordance with the foregoing provisions of this Section 2, shall cease vesting and terminate immediately. 

     3. Method of Exercise of the Stock Option. 

          (a) The portion of the Stock Option as to which the Optionee is vested shall be exercisable by delivery to the Company of a written or electronic notice stating the number of whole shares to be purchased pursuant to this Agreement and accompanied by payment of the full purchase price of the shares of Common Stock to be purchased. Fractional share interests shall be disregarded except that they may be accumulated. 

          (b) The exercise price of the Stock Option shall be paid: (i) in cash or by certified check or bank draft payable to the order of the Company; (ii) by exchange of shares of unrestricted Common Stock of the Company already owned by the Optionee (that have been held by the Optionee for six (6) months prior to exercise or which were acquired in the open market) and having an aggregate Fair Market Value equal to the aggregate purchase price, provided, that the Optionee represents and warrants to the Company that the Optionee has held the shares of Common Stock free and clear of liens and encumbrances and has held the shares for at least six (6) months prior to exercise or that such shares were acquired in the open market; (iii) by delivering, along with a properly executed exercise notice to the Company, a copy of irrevocable instructions to a broker to deliver promptly to the Company the aggregate
exercise price and, if requested by the Optionee, the amount of any applicable federal, state, local or foreign withholding taxes required to be withheld by the Company, provided, however, that such exercise may be implemented solely under a program or arrangement established and approved by the Company with a brokerage firm selected by the Company; or (iv) by any other procedure approved by the Committee, or by a combination of the foregoing. 

     4. Termination of Employment Other Than Due to Death or Disability. 

          (a) Except as provided in Section 4(b) below with regard to the Optionee’s termination of employment for Cause or following an event that would be grounds for a termination of employment for Cause and Section 5 below with regard to the Optionee’s termination of employment due to death or Disability, in the event of the Optionee’s termination of employment, the portion of the Stock Option, if any, which is exercisable at the time of such termination may be exercised prior to the first to occur of (a) the expiration of the ninety day (90) period which commences on the date of termination or (b) the expiration date of the Stock Option. 

          (b) In the event of the Optionee’s termination of employment for Cause, the Optionee’s entire Stock Option (whether or not vested) shall be forfeited and canceled in its entirety upon such termination of employment. If the Optionee has executed an employment agreement, the definition of “cause” contained therein, if any, shall govern. If there is no definition of “cause” in the governing employment agreement or the Optionee does not have an employment agreement, then the definition of cause shall be conduct by the Optionee, as determined in the sole discretion of the Company’s Board of Directors, involving one or more of the following: (a) gross misconduct or inadequate performance by the Optionee which is injurious to the Company; or (b) the commission of an act of embezzlement, fraud or theft, which results in economic loss, damage or injury to the Company; or (c)
the unauthorized disclosure of any trade secret or confidential information of the Company; or (d) the commission of an act which constitutes unfair competition with the Company or which induces any customer or prospective customer of the Company to breach a contract with the Company or to decline to do business with the Company; or (e) the indictment or conviction of the Optionee for a felony or a serious misdemeanor; or (f) the failure by the Optionee to perform in any material respect his or her employment, duties and obligations. 

          (c) Nothing in this Agreement or the Plan shall confer upon the Optionee any right to continue in the employ of the Company or any of its subsidiaries or affiliates or interfere in any way with the right of the Company or any such subsidiaries or affiliates to terminate the Optionee’s employment at any time. 

     5. Death or Disability of Optionee. 

     In the event of the Optionee’s termination of employment due to death (or, in the event of the Optionee’s death following termination of employment while the Stock Option remains exercisable) the portion of the Stock Option, if any, which is exercisable at the time of death may be exercised by the Optionee’s estate or by a person who acquired the right to exercise such Stock Option by bequest or inheritance or otherwise by reason of the death of the Optionee at any time prior to the first to occur of (a) twelve (12) months after the date of death or (b) the expiration date of the Stock Option. In the event of the Optionee’s termination of employment due to Disability, the portion of the Stock Option, if any, which is exercisable at the time of such termination of employment for Disability may be exercised by the Optionee or the Optionee’s guardian or legal representative at any time prior to the first to
occur of (a) twelve (12) months after such termination of employment or (b) the expiration date of the Stock Option. 

     6. Nontransferability of the Stock Option. 

     The Stock Option is non-transferable by the Optionee other than by will or the laws of descent and distribution or pursuant to a qualified domestic relations order, and the Stock Option may be exercised, during the lifetime of the Optionee, only by the Optionee or by the Optionee’s guardian or legal representative or any transferee described above. 

     7. Rights as a Stockholder. 

     An Optionee or a transferee of the Stock Option shall have no rights as a stockholder with respect to any shares covered by such Stock Option until the date when his or her purchase is entered upon the records of the duly authorized transfer agent of the Company. No adjustment shall be made for dividends (ordinary or extraordinary, whether in cash, securities or other property) or distribution of other rights for which the record date is prior to the date a stock certificate is issued, except as provided in the Plan. 

     8. Adjustment in the Event of Change in Stock. 

     In accordance with Section 10(c) of the Plan, in the event of any change in Corporate capitalization (including, but not limited to, a change in the number of shares of Common Stock outstanding), and the number and kind of shares subject to the Stock Option and/or the exercise price per share will be adjusted. The determination of the Committee regarding any adjustment will be final and conclusive.

     9. 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 THE EMPLOYMENT OR BUSINESS RELATIONSHIP AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING ENGAGED, BEING GRANTED THIS OPTION OR ACQUIRING 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 EMPLOYMENT FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE IN ANY WAY WITH OPTIONEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE THE RELATIONSHIP AT ANY TIME, WITH OR WITHOUT CAUSE.

     10. Other Restrictions.

     The exercise of the Stock Option shall be subject to the requirement that, if at any time the Committee shall determine that (i) the listing, registration or qualification of the shares of Common Stock subject or related thereto upon any securities exchange or under any state or federal law, or (ii) the consent or approval of any government regulatory body or (iii) an agreement by the Optionee with respect to the disposition of shares of Common Stock is necessary or desirable as a condition of, or in connection with, such exercise or the delivery or purchase of shares pursuant thereto, then in any such event, such exercise shall not be effective unless such listing, registration, qualification, consent, or approval or agreement shall have been effected or obtained free of any conditions not acceptable to the Committee. 

     The Company may, but will in no event be obligated to, register any securities issuable upon the exercise of all or any portion of the Stock Option pursuant to the Securities Act of 1933 (as now in effect or as hereafter amended) or to take any other affirmative action in order to cause the exercise of the Stock Option or the issuance of shares pursuant thereto to comply with any law or regulation of any governmental authority. The certificates representing shares issued to Optionee hereunder shall bear such legends as Company determines appropriate referring to restrictions on the transfer of such shares imposed by this Agreement and such other legends as are required or appropriate under applicable law. 

     11. Disqualifying Disposition. The Optionee agrees and covenants that if he disposes of any of the Common Stock in a “disqualifying disposition,” as described in Section 422 of the Code, he will immediately contact the Company to inform it of such event. 

     12. Taxes and Withholding. 

     No later than the date of exercise of the Stock Option granted hereunder, the Optionee shall pay to the Company or make arrangements satisfactory to the Committee regarding payment of any federal, state or local taxes of any kind required by law to be withheld upon the exercise of such Stock Option and the Company shall, to the extent permitted or required by law, have the right to deduct from any payment of any kind otherwise due to the Optionee, federal, state and local taxes of any kind required by law to be withheld upon the exercise of such Stock Option. The Optionee should consult with a tax advisor before exercising this Option or disposing of the Shares to obtain advice as to the consequences of such exercise or disposition.

     13. Notices.

     All notices and other communications under this Agreement shall be in writing and shall be given by hand delivery to the other party or by facsimile, overnight courier, or registered or certified mail, return receipt requested, postage prepaid, addressed as follows: 

     If to the Optionee:

     [ADDRESS]

 

     If to the Company:

     Attn: Chief Executive Officer
     Emisphere Technologies, Inc.
     765 Old Saw Mill River Road
     Tarrytown, NY 10591
     Telephone: (914) 785-4721
     Facsimile: (914) 593-8270

     or to such other address or facsimile number as any party shall have furnished to the other in writing in accordance with this Section 13. Notice and communications shall be effective when actually received by the addressee.

     14. Effect of Agreement.

     Except as otherwise provided hereunder, this Agreement shall be binding upon and shall inure to the benefit of any successor or successors of the Company, and to any transferee or successor of the Optionee pursuant to Section 6. 

     15. Laws Applicable to Construction. 

     The interpretation, performance and enforcement of this Agreement shall be governed by the laws of the State of Delaware without reference to principles of conflict of laws, as applied to contracts executed in and performed wholly within the State of Delaware. 

     16. Severability. 

     The invalidity or enforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement. If the final judgment of a court of competent jurisdiction declares that any provision of this Agreement is invalid or unenforceable, the parties hereto agree that the court making the determination of invalidity or unenforceability shall have the power, and is hereby directed, to reduce the scope, duration or area of the provision, to delete specific words or phrases and to replace any invalid or unenforceable provision with a provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable provision and this Agreement shall be enforceable as so modified. 

     17. Conflicts and Interpretation. 

     This Agreement is subject to all the terms, conditions and provisions of the Plan. In the event of any conflict between this Agreement and the Plan, the Plan shall control. In the event of any ambiguity in this Agreement, any term which is not defined in this Agreement, or any matters as to which this Agreement is silent, the Plan shall govern including, without limitation, the provisions thereof pursuant to which the Committee has the power, among others, to (i) interpret the Plan, (ii) prescribe, amend and rescind rules and regulations relating to the Plan and (iii) make all other determinations deemed necessary or advisable for the administration of the Plan. 

     18. Headings. 

     The headings of Sections herein are included solely for convenience of reference and shall not affect the meaning or interpretation of any of the provisions of this Agreement.

     19. Amendment.

     This Agreement may not be modified, amended or waived except by an instrument in writing signed by both parties hereto. The waiver by either party of compliance with any provision of this Agreement shall not operate or be construed as a waiver of any other provision of this Agreement, or of any subsequent breach by such party of a provision of this Agreement. 

     20. Term.

     The term of this Agreement is ten years from the date of grant, unless terminated prior to such date in accordance with the provisions herein.

     21. Counterparts.

     This Agreement may be executed in counterparts, which together shall constitute one and the same original.

IN WITNESS WHEREOF, as of the date first above written, the Company has caused this Agreement to be executed on its behalf by a duly authorized officer and the Optionee has hereunto set the Optionee’s hand. 

	EMISPHERE TECHNOLOGIES  
	 
	  
	 	 
	By:  
	Title:Exhibit 10.7

FORM OF RESTRICTED STOCK AGREEMENT

Under the Emisphere Technologies, Inc. 2007 Stock Award and Incentive Plan

     THIS AGREEMENT, made as of the ____ day of _______, 200[ ] (the “Grant Date”), by and between Emisphere Technologies, Inc., a Delaware corporation (the “Company”), and ____________ (the “Participant”).

     WHEREAS, the Board of Directors of the Company (the “Board”) adopted the Emisphere Technologies, Inc. 2007 Stock Award and Incentive Plan (the “Plan”); 

     WHEREAS, the Company wishes to grant to the Participant shares of its common stock, par value $.01 per share (“Common Stock” or the “Shares”) in the amount set forth below; and 

     WHEREAS, such Shares are to be subject to certain restrictions. 

     NOW, THEREFORE, the Company and the Participant agree as follows: 

1. Grant of Shares. Subject to the restrictions, terms and conditions of the Plan and this Agreement, the Company hereby awards to the Participant _______ shares of Common Stock. Pursuant to Sections 2 and 3 hereof, the Shares are subject to certain restrictions, which restrictions relate to the passage of time as a director of the Company. While such restrictions are in effect, the Shares subject to such restrictions shall be referred to herein as “Restricted Stock.” Unless otherwise indicated, any capitalized term used but not defined herein shall have the meaning ascribed to such term in the Plan.

2. Restrictions on Transfer. The Participant shall not sell, transfer, pledge, hypothecate, assign or otherwise dispose of the Shares of Restricted Stock, except as set forth in the Plan or this Agreement. Any attempted sale, transfer, pledge, hypothecation, assignment, exchange or other disposition of the Shares of Restricted Stock in violation of the Plan or this Agreement shall be void and of no effect and the Company shall have the right to disregard the same on its books and records and to issue “stop transfer” instructions to its transfer agent. 

3. Restricted Stock.

     3.1 Retention of Certificates. Promptly after the Grant Date, the Company shall issue stock certificates representing the Restricted Stock, unless it elects to recognize such ownership through book entry or another similar method pursuant to Section 8 herein. The stock certificates shall be registered in the Participant’s name and shall bear any legend required under the Plan. Such stock certificates shall be held in custody by the Company (or its designated agent) until the restrictions thereon shall have lapsed. Upon the Company’s request, the Participant shall deliver to the Company a duly signed stock power, endorsed in blank, relating to the Restricted Stock. In the event the Participant receives a stock dividend on the Restricted Stock or the Shares of Restricted Stock are split or the Participant
receives any other shares, securities, moneys or property representing a dividend on the Restricted Stock (other than regular cash dividends on and after the Grant Date) or representing a distribution or return of capital upon or in respect of the Restricted Stock or any part thereof, or resulting from a split-up, reclassification or other like changes of the Restricted Stock, or otherwise received in exchange therefor, and any warrants, rights or options issued to the Participant in respect of the Restricted Stock (collectively “RS Property”), the Participant will also immediately deposit with and deliver to the Company any such RS Property, including any certificates representing shares duly endorsed in blank or accompanied by stock powers duly endorsed in blank, and such RS Property shall be subject to the same restrictions, including that of this Section 3.1, as the Restricted Stock with regard to which they are issued and shall herein be encompassed within the term “Restricted
Stock.”  

     3.2 Rights with Regard to Restricted Stock. The Participant will have the right to vote the Restricted Stock, to receive and retain all regular cash dividends payable to holders of Shares of record on and after the Grant Date (although such dividends shall be treated, to the extent required by applicable law, as additional compensation for tax purposes if paid on Restricted Stock), and to exercise all other rights, powers and privileges of a holder of Common Stock with respect to the Restricted Stock set forth in the Plan, with the exceptions that: (i) the Participant will not be entitled to delivery of the stock certificate or certificates representing the Restricted Stock until the Restriction Period (as defined below) shall have expired; (ii) the Company (or its designated agent) will retain custody of
the stock certificate or certificates representing the Restricted Stock and the other RS Property during the Restriction Period; (iii) no RS Property shall bear interest or be segregated in separate accounts during the Restriction Period; and (iv) the Participant may not sell, transfer, pledge, hypothecate, assign, exchange or otherwise dispose of the Restricted Stock during the Restriction Period. For purposes of this Agreement, the “Restriction Period” for the Restricted Stock granted hereunder shall be the period commencing on the Grant Date and ending at the close of business on the date the Restricted Stock becomes vested. 

     3.3 Vesting.

          (a) The Restricted Stock shall become vested and cease to be Restricted Stock (but shall remain subject to Section 5 hereof) on the six (6) month anniversary of the Grant Date [INSERT VESTING SCHEDULE], provided that the Participant continuously serves as a Director of the Company or any of its Affiliates from the Grant Date through such vesting date.

     Notwithstanding the foregoing, the Restricted Stock shall become vested, and cease to be Restricted Stock (but shall remain subject to Section 5 hereof) upon the occurrence of a Change in Control of the Company. 

          (b) Change in Control. For the purpose of this Agreement, a "Change in Control" shall mean: 

     (i) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or more of the then outstanding shares of Common Stock of the Company (the “Outstanding Company Common Stock”); provided, however, that any acquisition by the Company or its subsidiaries, or any employee benefit plan (or related trust) of the Company or its subsidiaries of 50% or more of Outstanding Company Common Stock shall not constitute a Change in Control; and provided, further, that any acquisition by a corporation with respect to which, following such acquisition, more than 50% of the then outstanding shares of Common Stock of such corporation, is
then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners of the Outstanding Company Common Stock immediately prior to such acquisition in substantially the same proportion as their ownership, immediately prior to such acquisition, of the Outstanding Company Common Stock, shall not constitute a Change in Control; or 

     (ii) Approval by the stockholders of the Company of (i) a reorganization, merger or consolidation, in each case, with respect to which all or substantially all of the individuals and entities who were the beneficial owners of the Outstanding Company Common Stock immediately prior to such reorganization, merger or consolidation do not, following such reorganization, merger or consolidation, beneficially own, directly or indirectly, more than 50% of the then outstanding shares of common stock of the corporation resulting from such a reorganization, merger or consolidation, (ii) a complete liquidation or dissolution of the Company or (iii) the sale or other disposition of all or substantially all of the assets of the Company, excluding a sale or other disposition of assets to a subsidiary of the Company. 

     Anything in this Agreement to the contrary notwithstanding, if an event that would, but for this paragraph, constitute a Change in Control results from or arises out of a purchase or other acquisition of the Company, directly or indirectly, by a corporation or other entity in which the Participant has a greater than ten percent (10%) direct or indirect equity interest, such event shall not constitute a Change in Control. 

          (c) When any Shares of Restricted Stock become vested, the Company shall promptly issue and deliver to the Participant a new stock certificate registered in the name of the Participant for such Shares without the legend set forth in Section 4.1 hereof and deliver to the Participant any related other RS Property. The Participant shall be permitted to transfer Shares of Restricted Stock following the expiration of the Restriction Period, to the extent permitted by applicable law.

     3.4 Forfeiture. The Participant shall forfeit to the Company, without compensation, any and all unvested Shares of Restricted Stock and RS Property upon the Participant’s death, disability or any other cessation of service as a director of the Company for any reason. 

     3.5 Section 83(b).

          (a) The Participant acknowledges that he or she may elect (as required by Section 83(b) of the Internal Revenue Code of 1986, as amended (the “Code”)) within 30 days after the issuance of the Restricted Stock, to include in gross income for federal income tax purposes in the year of issuance the fair market value of such Shares of Restricted Stock. The Participant acknowledges that it is his or her sole responsibility, and not the Company’s, to file timely and properly the election under Section 83(b) of the Code and any corresponding provisions of state tax laws if he or she elects to utilize such election. The Participant acknowledges that he has been advised to consult with his or her personal tax advisor with respect to filing an election under Section 83(b) of the Code and other tax consequences hereunder.

          (b) If the Participant elects, in accordance with Section 83(b) of the Code, to recognize ordinary income in the year of acquisition of the Shares, the Company may require that the Participant, at the time of such election, make an additional payment for withholding tax purposes (or enter into an alternative arrangement to assure such payment) based on the difference, if any, between the purchase price for such Shares and the Fair Market Value of such Shares as of the day immediately preceding the date of the purchase of such Shares by the Participant.

     3.6 Delivery Delay. The delivery of any certificate representing the Restricted Stock or other RS Property may be postponed by the Company for such period as may be required for it to comply with any applicable federal or state securities law or any national securities exchange listing requirements and the Company is not obligated to issue or deliver any securities if, in the opinion of counsel for the Company, the issuance of such Shares shall constitute a violation by the Participant or the Company of any provisions of any law or of any regulations of any governmental authority or any national securities exchange; provided, however, that the Company shall use its reasonable best efforts to comply with any applicable federal or state securities law or national listing requirements to the extent that such
compliance is a necessary prerequisite to the delivery of the certificates. 

4 Legend. All certificates representing the Restricted Stock shall have endorsed thereon the following legends:

     4.1 “THE ANTICIPATION, ALIENATION, ATTACHMENT, SALE, TRANSFER, ASSIGNMENT, PLEDGE, ENCUMBRANCE OR CHARGE OF THE SHARES OF STOCK REPRESENTED HEREBY ARE SUBJECT TO THE TERMS AND CONDITIONS (INCLUDING A VESTING SCHEDULE AND FORFEITURE PROVISION AND RESTRICTIONS AGAINST TRANSFER) THE EMISPHERE TECHNOLOGIES, INC. (THE “COMPANY”) STOCK AWARD AND INCENTIVE PLAN, AND AN AGREEMENT ENTERED INTO BETWEEN THE REGISTERED OWNER AND THE COMPANY DATED AS OF THE ____ DAY OF _________, ____. COPIES OF SUCH PLAN AND AGREEMENT ARE ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY.”

     4.2 Any legend required to be placed thereon by applicable blue sky laws of any state.

     Notwithstanding the foregoing, in no event shall the Company be obligated to issue a certificate representing the Restricted Stock prior to the date the Restricted Stock becomes vested. 

5 Securities Representations. The Shares are being issued to the Participant and this Agreement is being made by the Company in reliance upon the following express representations and warranties of the Participant.

     The Participant acknowledges, represents and warrants that:

     5.1 he or she is acquiring the Shares for his or her own account for investment only, and not with a view to, or for sale in connection with, any distribution of the Shares in violation of the Securities Act of 1933 (the “Securities Act”), or any rule or regulation under the Securities Act;

     5.2 he or she has been advised that he or she may be an “affiliate” within the meaning of Rule 144 under the Securities Act and in this connection the Company is relying in part on his or her representations set forth in this section; 

     5.3 if he or she is deemed an affiliate within the meaning of Rule 144 of the Securities Act, the Shares must be held for the period of time required by applicable law unless an exemption from any applicable resale restrictions is available or the Company files an additional registration statement (or a “re-offer prospectus”) with regard to such Shares and the Company is under no obligation to register the Shares (or to file a “re-offer prospectus”); and 

     5.4 if he or she is deemed an affiliate within the meaning of Rule 144 of the Securities Act, he or she understands that the exemption from registration under Rule 144 will not be available unless (i) a public trading market then exists for the Common Stock of the Company, (ii) adequate information concerning the Company is then available to the public, and (iii) other terms and conditions of Rule 144 or any exemption therefrom are complied with; and that any sale of the Shares may be made only in limited amounts in accordance with such terms and conditions. 

6 No Right To Continue As A Director. The issuance of the Shares hereunder does not constitute an agreement by the Company to continue to have the Participant serve as a director of the Company or be nominated for reelection by the Company’s stockholders during the entire, or any portion of, the term of this Agreement, including but not limited to any period during which the Restricted Stock is outstanding. 

7 Power of Attorney. The Company, its successors and assigns, is hereby appointed the attorney-in-fact, with full power of substitution, of the Participant for the purpose of carrying out the provisions of this Agreement and taking any action and executing any instruments which such attorney-in-fact may deem necessary or advisable to accomplish the purposes hereof, which appointment as attorney-in-fact is irrevocable and coupled with an interest. In connection with actions permitted under the terms of this Agreement, the Company, as attorney-in-fact for the Participant, may in the name and stead of the Participant, make and execute all conveyances, assignments and transfers of the Restricted Stock, Shares and property provided for herein, and the Participant hereby ratifies and confirms all that the Company, as said attorney-in-fact, shall do
in good faith by virtue hereof. Nevertheless, the Participant shall, if so requested by the Company, execute and deliver to the Company all such instruments as may, in the judgment of the Company, be advisable for such purpose. 

8 Uncertificated Shares. Notwithstanding anything else herein, the Committee may, in its sole and absolute discretion and in accordance with Section 158 of the Delaware General Corporation Law, subject to the terms of the Plan, issue the Shares in the form of uncertificated shares. Such uncertificated Shares of Restricted Stock shall be credited to a book entry account maintained by the Company (or its designee) on behalf of the Participant. If thereafter certificates are issued with respect to the uncertificated Shares of Restricted Stock, such issuance and delivery of certificates shall be in accordance with the applicable terms of this Agreement. 

9 Miscellaneous. 

     9.1 Participant acknowledges and agrees that the Company has the right to deduct from payment of any kind otherwise due to Participant federal or state taxes of any kind required to be withheld with respect to the award of Shares or RS Property hereunder.

     9.2 This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, legal representatives, successors and assigns. 

     9.3 No modification or waiver of any of the provisions of this Agreement shall be effective unless in writing and signed by the party against whom it is sought to be enforced. 

     9.4 This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one contract. 

     9.5 The failure of any party hereto at any time to require performance by another party of any provision of this Agreement shall not affect the right of such party to require performance of that provision, and any waiver by any party of any breach of any provision of this Agreement shall not be construed as a waiver of any continuing or succeeding breach of such provision, a waiver of the provision itself, or a waiver of any right under this Agreement. 

     9.6 The headings of the sections of this Agreement have been inserted for convenience of reference only and shall in no way restrict or modify any of the terms or provisions hereof. 

     9.7 The Company shall pay all fees and expenses necessarily incurred by the Company in connection with this Agreement and will from time to time use its reasonable efforts to comply with all laws and regulations which, in the opinion of counsel to the Company, are applicable thereto. 

     9.8 All notices, consents, requests, approvals, instructions and other communications provided for herein shall be in writing and validly given or made when delivered, or on the second succeeding business day after being mailed by registered or certified mail, whichever is earlier, to the persons entitled or required to receive the same, at the addresses set forth at the heading of this Agreement or to such other address as either party may designate by like notice. Notices to the Company shall be addressed to the _____________ of the Company.

     9.9 This Agreement and the award hereunder are subject to all of the restrictions, terms and provisions of the Plan which are incorporated herein by reference. In the event of an inconsistency between any provision of the Plan and this Agreement, the terms of the Plan shall control. The capitalized terms in this Agreement that are not otherwise defined shall have the same meaning as set forth in the Plan. 

     9.10 By executing this Agreement the Participant hereby acknowledges receipt of a copy of the Plan, the Agreement and the prospectus, hereby represents that he or she is familiar with the terms and provisions thereof, and hereby accepts the Shares of Restricted Stock subject to all the provisions of the Plan and this Agreement. 

     9.11 This Agreement shall be governed and construed in accordance with the laws of the State of Delaware (regardless of the law that might otherwise govern under applicable Delaware principles of conflict of laws). 

[SIGNATURE PAGE FOLLOWS]

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written.

	EMISPHERE
      TECHNOLOGIES, INC.  
	 
	 
	By 	 	 
	Title:

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