Amended And Restated Stock Option Agreement - Ocean Park Advisors, LLC

Exhibit 10.1

NEITHER THIS SECURITY NOR THE SHARES OF STOCK ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (AS AMENDED, THE " SECURITIES ACT" ) OR UNDER THE SECURITIES LAWS OF ANY STATE. NEITHER THIS SECURITY NOR THE SHARES OF STOCK ISSUED UPON EXERCISE HEREOF MAY BE TRANSFERRED, SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND EXEMPTION OR QUALIFICATION UNDER ANY APPLICABLE STATE SECURITIES LAWS AND, IF REQUESTED BY THE COMPANY, DELIVERY TO THE COMPANY OF AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED. ANY ATTEMPT TO TRANSFER, SELL, PLEDGE OR HYPOTHECATE THIS SECURITY OR SUCH SHARES IN VIOLATION OF THESE RESTRICTIONS SHALL BE VOID. THE TRANSFER OF THIS SECURITY AND THE SHARES OF STOCK ISSUABLE UPON EXERCISE HEREOF ARE ALSO RESTRICTED BY THIS AGREEMENT. ALLEGRO BIODIESEL CORPORATION

STOCK OPTION AGREEMENT

PURSUANT TO 2006 INCENTIVE COMPENSATION PLAN

(As amended and restated effective September 20, 2006)

Ocean Park Advisors, LLC (the " Optionee" ) is hereby granted an option (the " Option" ) to purchase shares of the Common Stock of Allegro Biodiesel Corporation, a Delaware corporation (the " Company" ) pursuant to this Stock Option Agreement (this " Agreement" ) and the Company' s 2006 Incentive Compensation Plan (as amended, the " Plan" ), the provisions of which are incorporated herein by reference. The Option is amended and restated as set forth herein (i) to reflect the assumption by the Company of the Option previously granted by Diametrics Medical, Inc. (" Diametrics" ), pursuant to the merger of Diametrics into the Company, and (ii) to restrict the period during which the Option may be exercised, in accordance with Section 409A of the Code.

1. TERMS OF GRANT .

" Date of Option Grant" means September 20, 2006.

" Option Shares" means 2,069,109 shares of Common Stock; $0.01 per share, of the Company.

" Exercise Price" means $0.7587 per share of Common Stock " Option Expiration Date" means December 31, 2008, or such later date by which the Option may be exercised pursuant to Section 7.2.

" Vesting Date" means the later of (x) the first date that the closing sale price of the Company' s Common Stock on the OTC Bulletin Board, the NASDAQ Stock Market, the New York Stock Exchange, the American Stock Exchange or any other established United States stock exchange is greater than $1.33 per share and (y) the date of approval by the shareholders of the Company of either (i) an amendment to the Company' s Amended and Restated Articles of Incorporation to increase the number of shares of Common Stock that the Company is authorized to issue or (ii) the merger of the Company into a wholly owned subsidiary of the Company incorporated in the State of Delaware, in either case resulting in a sufficient number of authorized but unissued shares of Common Stock issuable upon exercise of this Option.

2. DEFINITIONS AND CONSTRUCTION .

2.1 Definitions . Unless otherwise defined herein, capitalized terms shall have the meanings assigned to such terms in the Plan.

2.2 Construction . Captions and titles contained herein are for convenience only and shall not affect the meaning or interpretation of any provision of this Agreement. Except when otherwise indicated by the context, the singular shall include the plural and the plural shall include the singular. Use of the term " or" is not intended to be exclusive, unless the context clearly requires otherwise. This Option is intended to comply with Section 409A of the Code and shall be interpreted and construed accordingly. 3. TAX CONSEQUENCES .

The Option is intended to constitute an " incentive stock option" as that term is used in Code Section 422. To the extent that the aggregate fair market value (determined at the time of grant) of Option Shares with respect to which incentive stock options are exercisable for the first time by the Participant during any calendar year under all plans of the Company and its subsidiaries exceeds $100,000, the options or portions thereof which exceed such limit (according to the order in which they were granted) shall be treated as nonstatutory stock options. It should be understood that there is no assurance that the Option will, in fact, be treated as an incentive stock option. The Optionee should consult with the Optionee' s own tax advisor regarding the tax effects of this Option (and any requirements necessary to obtain favorable income tax treatment under Code Section 422, including, but not limited to, holding period requirements). If the Option is treated as an Incentive Stock Option in part and as a Nonstatutory Stock Option in part by reason of the limitation set forth in this Section 3, the Optionee may designate which portion of such Option the Optionee is exercising. 4. EXERCISE OF THE OPTION .

4.1 Vesting and Right to Exercise . The Option shall be fully vested as of the Vesting Date. Except as otherwise provided herein, the Option shall be exercisable, to the extent the Option is vested, not earlier than January 1, 2008 and not later than the Option Expiration Date; provided that if a Change in Control occurs prior to January 1, 2008, and such Change in Control is also a " change in control event" within the meaning of Section 409A of the Code, the Option shall either be (i) converted into a right to receive a cash payment pursuant to Section 5.8(a)(2) of the Plan or (ii) be exercisable during the period beginning on the date of such Change in Control and ending on the later to occur of (A) the last day of the calendar year in which such Change in Control occurs or (B) the date that is 2 1 / 2 months after the date of such Change in Control.

4.2 Method of Exercise . Exercise of the Option shall be by written notice to the Company in the form of Exhibit A and Exhibit B hereto. The written notice must be signed by the Optionee and must be delivered in person, by certified or registered mail, return receipt requested, by confirmed facsimile transmission, or by such other means as the Company may permit, to the Chief Executive Officer of the Company, or other authorized representative of the Company, prior to the termination of the Option as set forth in Section 6, accompanied by full payment of the aggregate Exercise Price for the number of Option Shares being purchased. The Option shall be deemed to be exercised upon receipt by the Company of such written notice and the aggregate Exercise Price.

4.3 Payment of Exercise Price . (a) Forms of Consideration Authorized . Except as otherwise provided below, payment of the aggregate Exercise Price for the number of Option Shares for which the Option is being exercised shall be made (i) in cash, by check or cash equivalent, (ii) by tender to the Company of whole Option Shares owned by the Optionee having a Fair Market Value not less than the aggregate Exercise Price (iii) by retention by the Company of that number of Options Shares (the " Retained Shares" ) having an aggregate Fair Market Value on the date of exercise equal to the aggregate exercise price for all Option Shares for which the Option is being exercised, so that the Optionee receives the number of Option Shares for which the Option is exercised less the Retained Shares or (iv) by any combination of the foregoing. If the Retained Shares include a fractional share, the Retained Shares will be rounded up to the nearest whole share.


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(b) Limitations on Forms of Consideration . Notwithstanding the foregoing, the Option may not be exercised by tender to the Company of Option Shares to the extent such tender, or attestation to the ownership, of Stock would constitute a violation of the provisions of any law, regulation or agreement restricting the redemption of the Company' s stock. The Option may not be exercised by tender to the Company of shares of Stock unless such shares either have been owned by the Optionee for more than six (6) months or were not acquired, directly or indirectly, from the Company.

4.4 Tax Withholding . At the time the Option is exercised, in whole or in part, or at any time thereafter as requested by the Company, the Optionee hereby authorizes withholding from payroll and any other amounts payable to the Optionee, and otherwise agrees to make adequate provision for any sums required to satisfy the federal, state, local and foreign tax withholding obligations of the Company, if any, which arise in connection with the Option, including, without limitation, obligations arising upon (i) the exercise, in whole or in part, of the Option, (ii) the transfer, in whole or in part, of any Option Shares acquired upon exercise of the Option, (iii) the operation of any law or regulation providing for the imputation of interest, or (iv) the lapsing of any restriction with respect to any shares acquired upon exercise of the Option. The Optionee is cautioned that the Option is not exercisable unless the tax withholding obligations of the Company are satisfied. Accordingly, the Optionee may not be able to exercise the Option when desired even though the Option is vested, and the Company shall have no obligation to issue a certificate for such shares.

4.5 Certificate Registration . The certificate for the Option Shares as to which the Option is exercised shall be registered in the name of the Optionee, or, if applicable, the Optionee' s heirs. 4.6 Restrictions on Grant of the Option and Issuance of Shares . The grant of the Option and the issuance of Option Shares upon exercise of the Option shall be subject to compliance with all applicable requirements of federal, state or foreign law with respect to such securities. The Option may not be exercised if the issuance of Option Shares upon exercise would constitute a violation of any applicable federal, state or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed. THE OPTIONEE IS CAUTIONED THAT THE OPTION MAY NOT BE EXERCISED UNLESS THE FOREGOING CONDITIONS ARE SATISFIED. ACCORDINGLY, THE OPTIONEE MAY NOT BE ABLE TO EXERCISE THE OPTION WHEN DESIRED EVEN THOUGH THE OPTION IS VESTED. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company' s legal counsel to be necess ...