EXHIBIT 10.1
Published on May 5, 2006
EXHIBIT
10.1
EXTENSION
OF STOCK OPTION AGREEMENTS
This
extension of previously issued stock option grants (this "Agreement") is entered
into on this 2nd day of May, 2006, by and between Rexahn Pharmaceuticals, Inc.,
a Delaware corporation (the "Company"), and John Holaday, the undersigned
director (the "Director") of the Company.
WHEREAS,
the Director was previously granted stock options pursuant to Stock Option
Grant
Agreements, dated August 5, 2003, April 20, 2004 and September 12, 2005, by
and
between the Company and the Director, as amended by the consent letter dated
December 8, 2005 (collectively, the "Option Agreements"; and the stock options
granted pursuant to the Option Agreements are hereinafter referred to as the
"Options"); and
WHEREAS,
the Director and the Company now wish, among other things, to extend the
exercise period of those Options in connection with the Director’s resignation
as a director of the Company; and
WHEREAS,
the Director and the Company are cognizant of the new rules governing stock
options under Internal Revenue Code Section 409A (together with any proposed
and
final regulations and other guidance issued thereunder by the Internal Revenue
Service, "Section 409A") and that the Options, may be subject to Section 409A;
NOW,
THEREFORE, in consideration of the above premises, the mutual covenants
contained herein, and other good and valuable consideration, the receipt of
which is hereby acknowledged, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. Non-Statutory
Stock Options.
The
Director understands, acknowledges, and accepts that the Options are treated,
including for tax purposes, as non-statutory stock options.
2. Vesting.
Notwithstanding anything to the contrary in the Option Agreements, immediately
upon the Director's termination of service as a director of the Company, all
of
the Options, to the extent not already exercisable, will become
exercisable.
3. Exercise
Period.
The
parties hereto agree that the time periods during which the Director may
exercise his vested Options are extended until the 10th anniversary of the
Grant
Date (as defined in the Option Agreements) of the respective
Options.
4. Section
409A Matters.
Nothing
in this Agreement or any other agreement between the parties hereto is to be
construed by the Director or any other person as a guaranty or assurance of
any
sort by the Company that the Options were and/or continue to be exempt from
the
requirements of Section 409A. The Director acknowledges that it is his
responsibility, in conjunction with his tax advisors, to consider the effect
of
this Agreement on his individual tax situation, that the Company makes no
representations with regard thereto (other than notifying the Director that
the
Options may be subject to Section 409A as a result of this Agreement) and that
the Company may comply with its obligations under Section 409A, including its
reporting and disclosure obligations with respect to the Director and the
Options. The Director represents and warrants that he has carefully read and
fully understand the terms of this Agreement and has had the advice and
assistance of counsel with respect thereto and agrees that he will indemnify
and
hold harmless the Company to the extent of any losses, liabilities, claims,
damages, fines, taxes, penalties, costs and expenses incurred or suffered by
the
Company arising out of its compliance with Section 409A with respect to the
Options.
5. Continued
Validity of the Option Agreements.
The
Option Agreements will remain in full force and effect, will continue to bind
the parties hereto, and will continue to govern the terms and conditions of
the
Options except as those provisions are modified and superseded by this
Agreement. To the extent that the terms of this Agreement conflict or are
inconsistent with the terms of the Option Agreements, the terms of this
Agreement will govern.
6. Entire
Agreement.
This
Agreement, the Option Agreements, and the Stock Option Plan under which the
Option Agreements was issued, constitute the entire agreement between the
parties hereto respecting the Options (the "Entire Agreement"). There being
no
representations, warranties, or commitments between the parties hereto except
as
set forth in the Entire Agreement, the Entire Agreement replaces and supersedes
any other agreement or arrangement, oral or written, between the Director and
the Company respecting the Options.
7. Governing
Law.
Notwithstanding anything to the contrary contained in the Option Agreements,
this Agreement and the Option Agreements shall be governed by and construed
in
accordance with the laws of the State of Delaware without giving effect to
the
conflict of laws principle thereof.
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IN
WITNESS WHEREOF, the parties hereto have executed this document as of the date
first set forth above.
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REXAHN
PHARMACEUTICALS, INC.
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JOHN
HOLADAY
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By:
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/s/
Tae H. Jeong
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/s/
John Holaday
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Name:
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Ted
Jeong
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Title:
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CFO
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