DRKOOP COM INC
NON-QUALIFIED STOCK OPTION AGMT. - EDWARD A. CESPEDES
<DOCUMENT>
<TYPE>EX-10.85
<SEQUENCE>14
<FILENAME>0014.txt
<DESCRIPTION>NON-QUALIFIED STOCK OPTION AGMT. - EDWARD A. CESPEDES
<TEXT>

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                                                                   EXHIBIT 10.85

                               DRKOOP.COM, INC.

                     2000 NON-QUALIFIED STOCK OPTION PLAN

                     NON-QUALIFIED STOCK OPTION AGREEMENT


     Unless otherwise defined herein, the terms defined in the drkoop.com, Inc.
2000 Non-Qualified Stock Option Plan (the "Plan") shall have the same defined
meanings in this Stock Option Agreement.

I.   NOTICE OF STOCK OPTION GRANT
     ----------------------------

     Edward A. Cespedes

     1221 Ocean Avenue, #403
     Santa Monica, California 90401

     You ("Optionee") have been granted an option to purchase Common Stock of
the Company, subject to the terms and conditions of the Plan and this Stock
Option Agreement.  The terms of your grant are set forth below:

     Date of Grant:                     August 22, 2000
     Vesting Commencement Date:         August 22, 2000
     Exercise Price per Share:          $0.35 per share
     Total Number of Shares Granted:    2,600,000
     Total Exercise Price:              $910,000.00
     Type of Option:                    Non-Qualified Stock Option
     Term/Expiration Date:              August 22, 2007 (Seventh anniversary of
                                        Date of Grant)


     Exercise and Vesting Schedule:
     -----------------------------

     This Option shall vest and become exercisable according to the following
schedule:
<PAGE>

     Subject to the following paragraphs, this Option shall vest and become
exercisable with respect to twenty-five percent (25%) of the shares of the
Company's Common Stock subject to the Option (the "Shares") on the Option's Date
of Grant, and thereafter, with respect to twenty-five percent (25%) of the
Shares on each twelve-month anniversary of the Option's Date of Grant (each, a
"Vesting Date"), commencing with the first such anniversary, such that this
Option shall be vested and exercisable with respect to one hundred percent
(100%) of the Shares on the third anniversary of the Option's Date of Grant;
provided, however, that Optionee has remained in Continuous Status as an
Employee or Consultant as of each Vesting Date.

     Notwithstanding the foregoing, this Option shall vest and become
exercisable with respect to one hundred percent (100%) of the Shares subject to
the Option immediately prior to the earlier of (i) Optionee's termination of
employment with the Company for Good Reason or by the Company for any reason
other than Cause, death or Disability (each such term as defined in that certain
Employment Agreement between the Company and Optionee, dated as of August 22,
2000, as may be amended from time to time) or (ii) in addition to the conditions
upon which the Option may automatically accelerate and become exercisable in
accordance with the Plan, upon the consummation of the following:  (a) any sale,
merger, consolidation, tender offer or similar acquisition of shares, or other
transaction or series of related transactions (each a "Transaction") as a result
of which at least a majority of the voting power of the Company is not held,
directly or indirectly, by the persons or entities who held the Company's
securities with voting power before such Transaction; (b) a sale or other
disposition of all or substantially all of the Company's assets, whether in one
transaction or a series of related transactions; or (c) individuals who on the
date hereof constitute the Board of Directors and any new Director (other than a
Director designated by a person or entity who has entered into an agreement to
effect a transaction described in clause (a) or (b) above) whose nomination
and/or election to the Board of Directors was approved by a vote of at least a
majority of the Directors then still in office who either were Directors on the
date hereof or whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority of the Board of
Directors.

     Termination Period:
     ------------------

     This Option may be exercised, to the extent vested, at any time prior to
the Term/Expiration Date provided above.

II.  AGREEMENT
     ---------

     1.  Grant of Option.  The Company hereby grants to the Optionee an Option
         ---------------
to purchase the number of Shares set forth in the Notice of Stock Option Grant
(the "Notice of Grant"), at the exercise price per share set forth in the Notice
of Grant (the "Exercise Price"). Notwithstanding anything to the contrary
anywhere else in this Stock Option Agreement, this grant of an Option is subject
to the terms, definitions and provisions of the Plan adopted by the Company,
which is incorporated herein by reference. This Option is not intended to, and
does not, qualify as an Incentive Stock Option as defined in Section 422 of the
Code.

     2.  Exercise of Option.  This Option is exercisable as follows:
         ------------------

                                       2
<PAGE>

         (a)  Right to Exercise.
              -----------------

              (i)   This Option shall be exercisable cumulatively according to
the vesting schedule set out in the Notice of Grant. For purposes of this Stock
Option Agreement, Shares subject to this Option shall vest based on Optionee's
Continuous Status as an Employee or Consultant.

              (ii)  This Option may not be exercised for a fraction of a Share.

              (iii) In the event of Optionee's termination of Continuous Status
as an Employee or Consultant, the exercisability of the Option is governed by
Section 5 below.

              (iv)  In no event may this Option be exercised after the date of
expiration of the term of this Option as set forth in the Notice of Grant.

         (b)  Method of Exercise.  This Option shall be exercisable by written
              ------------------
Notice (in the form attached as Exhibit A).  The Notice must state the number of
                                ---------
Shares for which the Option is being exercised, and such other representations
and agreements with respect to such shares of Common Stock as may be required by
the Company pursuant to the provisions of the Plan or as may be necessary in
order for the Company to comply with Applicable Laws. The Notice must be signed
by the Optionee and shall be delivered in person or by certified mail to the
Secretary of the Company. The Notice must be accompanied by payment of the
Exercise Price, including payment of any applicable withholding tax. This Option
shall be deemed to be exercised upon receipt by the Company of such written
Notice accompanied by the Exercise Price and payment of any applicable
withholding tax.

         No Shares shall be issued pursuant to the exercise of an Option unless
such issuance and such exercise comply with Applicable Laws and the requirements
of any stock exchange upon which the Shares may then be listed.  Assuming such
compliance, for income tax purposes the Shares shall be considered transferred
to the Optionee on the date on which the Option is exercised with respect to
such Shares.

     3.  Method of Payment.  Payment of the Exercise Price shall be by any of
         -----------------
the following, or a combination thereof, at the election of the Optionee:

         (a)  cash;

         (b)  check;

         (c)  with the consent of the Administrator, other shares of Common
Stock that (i) in the case of shares acquired upon exercise of an option granted
by the Company either have been owned by the Optionee for more than six months
on the date of surrender or were not acquired, directly or indirectly, from the
Company, and (y) have a Fair Market Value on the date of surrender equal to the
aggregate exercise price of the shares as to which said Option shall be
exercised;

         (d)  with the consent of the Administrator in its sole and absolute
discretion, authorization from the Company to retain from the total number of
shares as to which the Option

                                       3
<PAGE>

is exercised that number of shares having a Fair Market Value on the date of
exercise equal to the exercise price for the total number of shares as to which
the Option is exercised;

         (e)  with the consent of the Administrator, delivery of a properly
executed exercise notice together with irrevocable instructions to a broker to
deliver promptly to the Company the amount of sale or loan proceeds required to
pay the exercise price;

         (f)  with the consent of the Administrator, a combination of any of the
foregoing methods of payment;

         (g)  with the consent of the Administrator, a combination of any of the
foregoing methods of payment at least equal in value to the stated capital
represented by the Shares to be issued, plus a promissory note for the balance
of the exercise price; or

         (h)  with the consent of the Administrator, such other consideration
and method of payment for the issuance of Shares to the extent permitted under
Applicable Laws.

     4.  Restrictions on Exercise.  If the issuance of Shares upon such
         ------------------------
exercise or if the method of payment for such shares would constitute a
violation of any applicable federal or state securities or other law or
regulation, then the Option may also not be exercised. The Company may require
Optionee to make any representation and warranty to the Company as may be
required by any applicable law or regulation before allowing the Option to be
exercised.

     5.  Termination of Relationship.  If Optionee terminates Continuous Status
         ---------------------------
as an Employee or Consultant for any reason, Optionee may exercise this Option
during the Termination Period set out in the Notice of Grant, to the extent the
Option was vested at the date of such termination. To the extent that Optionee
was not vested in this Option at the date on which Optionee terminates
Continuous Status as an Employee or Consultant, or if Optionee does not exercise
this Option within the time specified herein, the Option shall terminate.

     6.  Non-Transferability of Option.  This Option may not be transferred in
         -----------------------------
any manner except by will or by the laws of descent or distribution.  It may be
exercised during the lifetime of Optionee only by Optionee.  The terms of this
Option shall be binding upon the executors, administrators, heirs, successors
and assigns of the Optionee.

     7.  Term of Option.  This Option may be exercised only within the term set
         --------------
out in the Notice of Grant.

                           [Signature Page Follows]

                                       4
<PAGE>

          This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original and all of which shall constitute one
document.

                                    DRKOOP.COM, INC.

                                    By: /s/ Richard M. Rosenblatt
                                       -----------------------------------

                                    Name:  Richard M. Rosenblatt
                                         ---------------------------------

                                    Title:  Chief Executive Officer
                                          --------------------------------

     OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE
     OPTION HEREOF IS EARNED ONLY BY CONTINUING CONSULTANCY OR EMPLOYMENT AT THE
     WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS
     OPTION OR ACQUIRING SHARES HEREUNDER).  OPTIONEE FURTHER ACKNOWLEDGES AND
     AGREES THAT NOTHING IN THIS AGREEMENT, NOR IN THE COMPANY'S 2000 NON-
     QUALIFIED STOCK OPTION PLAN WHICH IS INCORPORATED HEREIN BY REFERENCE,
     SHALL CONFER UPON OPTIONEE ANY RIGHT WITH RESPECT TO CONTINUATION OF
     EMPLOYMENT OR CONSULTANCY BY THE COMPANY, NOR SHALL IT INTERFERE IN ANY WAY
     WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE OPTIONEE'S
     EMPLOYMENT OR CONSULTANCY AT ANY TIME, WITH OR WITHOUT CAUSE.

     Optionee acknowledges receipt of a copy of the Plan and represents that he
is familiar with the terms and provisions thereof.  Optionee hereby accepts this
Option subject to all of the terms and provisions hereof.  Optionee has reviewed
the Plan and this Option in their entirety, has had an opportunity to obtain the
advice of counsel prior to executing this Option and fully understands all
provisions of the Option.  Optionee hereby agrees to accept as binding,
conclusive and final all decisions or interpretations of the Administrator upon
any questions arising under the Plan or this Option.  Optionee further agrees to
notify the Company upon any change in the residence address indicated below.

Dated: August 22, 2000                   /s/ Edward A. Cespedes
                                         ---------------------------------
                                         EDWARD A. CESPEDES


                                         Residence Address:

                                         1221 Ocean Avenue, #403
                                         Santa Monica, California 90401

                                       5
<PAGE>

                                   EXHIBIT A
                                   ---------

                               DRKOOP.COM, INC.

                     2000 NON-QUALIFIED STOCK OPTION PLAN

                                EXERCISE NOTICE

drkoop.com, Inc.

Attention:  Secretary

     1.  Exercise of Option.  Effective as of today, ___________, _____, the
         ------------------
undersigned ("Optionee") hereby elects to exercise Optionee's option to purchase
_________ shares of the Common Stock (the "Shares") of drkoop.com, Inc. (the
"Company") under and pursuant to the drkoop.com, Inc. 2000 Non-Qualified Stock
Option Plan (the "Plan") and the Non-Qualified Stock Option Agreement dated
_____________, _____, (the "Option Agreement").

     2.  Representations of Optionee.  Optionee acknowledges that Optionee has
         ---------------------------
received, read and understood the Plan and the Option Agreement.  Optionee
agrees to abide by and be bound by their terms and conditions.

     3.  Rights as Stockholder.  Until the stock certificate evidencing such
         ---------------------
Shares is issued (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company), no right to vote
or receive dividends or any other rights as a stockholder shall exist with
respect to Shares subject to the Option, notwithstanding the exercise of the
Option. The Company shall issue (or cause to be issued) such stock certificate
promptly after the Option is exercised. No adjustment will be made for a
dividend or other right for which the record date is prior to the date the stock
certificate is issued, except as provided in Section IV of Article One of the
Plan. Optionee shall enjoy rights as a stockholder until such time as Optionee
disposes of the Shares.

     4.  Tax Consultation.  Optionee understands that Optionee may suffer
         ----------------
adverse tax consequences as a result of Optionee's purchase or disposition of
the Shares. Optionee represents that Optionee has consulted with any tax
consultants Optionee deems advisable in connection with the purchase or
disposition of the Shares and that Optionee is not relying on the Company for
any tax advice.

     5.  Restrictive Legends.
         -------------------

         (a)  Legends.  Optionee understands and agrees that the Company shall
              -------
cause any other legends that may be required by state or federal securities laws
to be placed upon any certificate(s) evidencing ownership of the Shares.

         (b)  Refusal to Transfer.  The Company shall not be required (i) to
              -------------------
transfer on its books any Shares that have been sold or otherwise transferred in
violation of any of the provisions of
<PAGE>

this Agreement or (ii) to treat as owner of such Shares or to accord the right
to vote or pay dividends to any purchaser or other transferee to whom such
Shares shall have been so transferred.

     6.   Successors and Assigns.  The Company may assign any of its rights
          ----------------------
under this Agreement to single or multiple assignees, and this Agreement shall
inure to the benefit of the successors and assigns of the Company. Subject to
the restrictions on transfer herein set forth, this Agreement shall be binding
upon Optionee and his or her heirs, executors, administrators, successors and
assigns.

     7.   Interpretation.  Any dispute regarding the interpretation of this
          --------------
Agreement shall be submitted by Optionee or by the Company forthwith to the
Administrator, which shall review such dispute at its next regular meeting. The
resolution of such a dispute by the Administrator shall be final and binding on
the Company and on Optionee.

     8.   Governing Law; Severability.  This Agreement shall be governed by and
          ---------------------------
construed in accordance with the laws of the State of Texas excluding that body
of law pertaining to conflicts of law. Should any provision of this Agreement be
determined by a court of law to be illegal or unenforceable, the other
provisions shall nevertheless remain effective and shall remain enforceable.

     9.   Notices.  Any notice required or permitted hereunder shall be given in
          -------
writing and shall be deemed effectively given upon personal delivery or upon
deposit in the United States mail by certified mail, with postage and fees
prepaid, addressed to the other party at its address as shown below beneath its
signature, or to such other address as such party may designate in writing from
time to time to the other party.

     10.  Further Instruments.  The parties agree to execute such further
          -------------------
instruments and to take such further action as may be reasonably necessary to
carry out the purposes and intent of this Agreement.

     11.  Delivery of Payment.  Optionee herewith delivers to the Company the
          -------------------
full Exercise Price for the Shares, as well as any applicable withholding tax.

                                       1
<PAGE>

     12.  Entire Agreement.  The Plan and Option Agreement are incorporated
          ----------------
herein by reference. This Agreement, the Plan and the Option Agreement
constitute the entire agreement of the parties and supersede in their entirety
all prior undertakings and agreements of the Company and Optionee with respect
to the subject matter hereof.

Submitted by:                            Accepted by:

OPTIONEE:                                DRKOOP.COM, INC.


__________________________________       By:______________________________

                                         Its:_____________________________

Address:
-------


__________________________________
__________________________________
__________________________________


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