Sample Business Contracts

Stock Option Agreement - Hansen Natural Corp. and Mark J. Hall

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                             STOCK OPTION AGREEMENT

     This Stock Option  Agreement  ("Agreement") is made as of July 12, 2002, by
and between Hansen Natural Corporation,  a Delaware corporation (the "Company"),
and Mark J. Hall ("Holder").
                              Preliminary Recitals

     A.  Holder is an  employee  of the  Company or one of its  subsidiaries  or
     B. Pursuant to the Hansen Natural  Corporation  2001 Stock Option Plan (the
"Plan"),  the  Company  desires to grant  Holder an  incentive  stock  option to
purchase  shares of the Company's  common stock,  par value $.005 per share (the
"Common Stock").

     NOW, THEREFORE, the Company and Holder agree as follows:
     1. Grant of Incentive  Stock Option.  The Company  hereby grants to Holder,
subject to the terms and conditions set forth herein, the incentive stock option
("ISO") to purchase up to 20,000 shares of Common Stock,  at the purchase  price
of $3.57 per share,  such ISO to be  exercisable  and  exercised as  hereinafter

     2. Exercise Period. The ISO shall expire three months after the termination
of the Holder's  employment with the Company and its subsidiaries and affiliates
(the "Hansen  Natural Group") unless the employment is terminated by a member of
the Hansen  Natural Group for Cause (as defined  below) or unless the employment
is terminated by reason of the death or Total  Disability  (as defined below) of
Holder.  If the  Holder's  employment  is  terminated  by a member of the Hansen
Natural  Group  for  Cause,  the ISO  shall  expire  as of the  date  employment
terminates.  If the  Holder's  employment  terminates  due to his death or Total
Disability,  then the ISO may be exercised by Holder or the person or persons to
which  Holder's  rights under this  Agreement pass by will, or if no such person
has such right, by his executors or administrators,  within six months after the
date of death or  Total  Disability,  but no  later  than  the  expiration  date
specified  in Section  3(c) below.  "Cause"  means the  Holder's act of fraud or
dishonesty,  knowing  and  material  failure to comply with  applicable  laws or
regulations or satisfactorily perform his duties of employment,  insubordination
or drug or alcohol  abuse,  as determined by the Committee of the Hansen Natural
Corporation Stock Option Plan (the  "Committee").  "Total  Disability" means the
complete  and  permanent  inability  of Holder to  perform  all of his duties of
employment  with the Company,  as determined by the Committee  upon the basis of
such evidence,  including independent medical reports and data, as the Committee
deems appropriate or necessary.


     3. Exercise of Option
     (a)  Subject  to  the  other  terms  of  this   Agreement   regarding   the
exercisability  of the ISO, and provided  that Holder is employed by a member of
the Hansen  Natural Group on the relevant date, the ISO may only be exercised in
respect of the number of shares  listed in column A from and after the  exercise
dates listed in column B,

              Column "A"                              Column "B"
          Number of Shares                          Exercise Date

               4,000                                July 12, 2003
               4,000                                July 12, 2004
               4,000                                July 12, 2005
               4,000                                July 12, 2006
               4,000                                July 12. 2007

     (b) This ISO may be exercised, to the extent exercisable by its terms, from
time to time in whole or in part at any time  prior to the  expiration  thereof.
Any exercise shall be accompanied by a written notice to the Company  specifying
the  number of  shares  as to which  this ISO is being  exercised  (the  "Option
Shares").  Notations of any partial exercise or installment  exercise,  shall be
made by the Company on Schedule A hereto.
     (c)  Notwithstanding  anything else herein to the contrary,  this ISO shall
expire ten years from the date of this agreement.
     (d) The Holder  hereby agrees to notify the Company in writing in the event
shares acquired pursuant to the exercise of this ISO are transferred, other than
by will or by the laws of descent and  distribution,  within two years after the
date  indicated  above or within  one year  after the  issuance  of such  shares
pursuant to such exercise.

     4. Payment of Purchase Price Upon Exercise.  At the time of any exercise of
the ISO the  purchase  price of the ISO shall be paid in full to the  Company in
any of the following ways or in any combination of the following ways:
     (a) By check or other immediately available funds.
     (b) With  property  consisting  of shares of Common  Stock.  (The shares of
Common Stock to be used as payment shall be valued as of the date of exercise of
the ISO at the Closing Price as defined below. For example,  if Holder exercises
the  option  for 4,000  shares at a total  Exercise  Price of  $8,000,  assuming
exercise  price of $2.00 per share,  and the Closing Price is $5.00,  he may pay
for the 4,000 Option Shares by transferring  1,600 shares of Common Stock to the


     (c) By  delivering  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  necessary  to pay  the  purchase  price  and
applicable  withholding  taxes,  and such other  documents as the  Committee may
     (d) For purposes of this Agreement,  the term "Closing  Price" means,  with
respect to the Company's  Common Stock,  the last sale price  regular-way or, in
case no such sale takes  place on such date,  the average of the closing bid and
asked prices regular-way on the principal national  securities exchange on which
the securities are listed or admitted to trading;  or, if they are not listed or
admitted to trading on any national securities exchange,  the last sale price of
the securities on the consolidated  transaction reporting system of the National
Association of Securities  Dealers  ("NASD"),  if such last sale  information is
reported on such system or, if not so  reported,  the average of the closing bid
and asked prices of the  securities  on the National  Association  of Securities
Dealers  Automatic  Quotation System  ("NASDAQ") or any comparable system or, if
the securities are not listed on NASDAQ or a comparable  system,  the average of
the  closing  bid and  asked  prices as  furnished  by two  members  of the NASD
selected from time to time by the Company for that purpose.

     5.  Purchase for  Investment;  Resale  Restrictions.  Unless at the time of
exercise of the ISO there shall be a valid and effective  registration statement
under the Securities Act of 1933 ("'33 Act") and appropriate  qualification  and
registration  under  applicable  state  securities  laws  relating to the Option
Shares  being   acquired,   Holder  shall  upon  exercise  of  the  ISO  give  a
representation  that  he is  acquiring  such  shares  for his  own  account  for
investment and not with a view to, or for sale in connection with, the resale or
distribution of any such shares. In the absence of such registration  statement,
Holder shall execute a written affirmation, in a form reasonably satisfactory to
the Company,  of such investment intent.  Holder further agrees that he will not
sell or transfer any Option  Shares until he requests and receives an opinion of
the Company's counsel or other counsel reasonably satisfactory to the Company to
the effect that such proposed sale or transfer will not result in a violation of
the '33 Act, or a  registration  statement  covering the sale or transfer of the
shares has been declared effective by the Securities and Exchange Commission, or
he obtains a no-action  letter from the Securities and Exchange  Commission with
respect to the proposed transfer.

     6. Nontransferability.This ISO shall not be transferable other than by will
or by the laws of descent and distribution.  During the lifetime of Holder, this
ISO shall be exercisable only by Holder.


     7. Adjustments.
     (a) Subject to clause 7(b) below, if the outstanding shares of stock of the
Company are increased, decreased, or exchanged for a different number or kind of
shares or other  securities,  or if additional shares or new or different shares
or other  securities  are  distributed  with  respect to such shares of stock or
securities,  through merger, consolidation,  sale of all or substantially all of
the property of the Company, reorganization, recapitalization, reclassification,
stock  dividend,  stock split,  reverse stock split or other  distribution  with
respect  to such  shares  of stock  or other  securities,  then,  to the  extent
permitted  by the  Board  of  the  Company,  an  appropriate  and  proportionate
adjustment  shall be made in (1) the maximum number and kind of shares  provided
in clause 1 above; (2) the number and kind of shares or other securities subject
to the  outstanding  options and tandum SARs, if any; and (3) the price for each
share or other  unit of any other  securities  subject  to  outstanding  options
without change in the aggregate  purchase price or value as to which the options
remain exercisable or subject to restrictions.  Any adjustment under this clause
7(a) shall be made by the Board of the Company,  whose  determination as to what
adjustments  shall be made,  if any,  and the  extent  thereof,  will be  final,
binding  and  conclusive.  No  fractional  interests  will be issued  under this
agreement resulting from any such adjustment.
     (b) Notwithstanding  anything else herein to the contrary, the Board of the
Company  may,  at any  time,  in its  sole  discretion,  provide  that  upon the
occurrence  of a change in control of the Company (as  determined by the Board),
all  or  a  specified  portion  of  any  outstanding   options  not  theretofore
exercisable  shall  immediately  become  exercisable  and  that any  option  not
exercised prior to such change in control shall be canceled.

     8. No Rights as  Stockholder.  Holder shall have no rights as a stockholder
with respect to any shares of Common Stock subject to this ISO prior to the date
of issuance to him of a certificate or certificates for such shares.

     9. No Right to Continue  Employment.  This Agreement  shall not confer upon
Holder any right with respect to  continuance  of employment  with any member of
the Hansen Natural Group nor shall it interfere in any way with the right of any
such member to terminate his employment at any time.


     10.  Compliance With Law and Regulation.  This Agreement and the obligation
of the Company to sell and deliver  shares of Common  Stock  hereunder  shall be
subject to all applicable  federal and state laws,  rules and regulations and to
such approvals by any government or regulatory agency as may be required.  If at
any time the Board of  Directors  of the Company  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, is necessary
or desirable as a condition  of or in  connection  with the issue or purchase of
shares of Common Stock  hereunder,  this ISO may not be exercised in whole or in
part unless such  listing,  registration,  qualification,  consent,  approval or
agreement  shall have been  effected  or  obtained  free of any  conditions  not
acceptable to the Board of Directors.

     11.  Tax  Withholding  Requirements.  The  Company  shall have the right to
require  Holder to remit to the  Company an amount  sufficient  to  satisfy  any
federal,  state or local  withholding tax requirements  prior to the delivery of
any certificate or certificates for Common Stock.

     12.  Fractional  Shares.   Notwithstanding  any  other  provision  of  this
Agreement,  no  fractional  shares of stock shall be issued upon the exercise of
this ISO and the Company shall not be under any obligation to compensate  Holder
in any way for such fractional shares.

     13. Notices.  Any notice  hereunder to the Company shall be addressed to it
at its office at 1010 Railroad  Street,  Corona,  California  92882,  Attention:
Rodney C. Sacks with a copy to Benjamin Polk, Winston & Strawn, 200 Park Avenue,
New York, New York 10166,  and any notice hereunder to Holder shall be addressed
to him at  __________,  subject to the right of either party to designate at any
time hereafter in writing some other address.

     14.  Amendment.  No  modification,  amendment  or  waiver  of  any  of  the
provisions of this Agreement shall be effective  unless in writing  specifically
referring hereto, and signed by both parties.

     15. Governing Law. This Agreement shall be construed  according to the laws
of the  State of  Delaware  and all  provisions  hereof  shall  be  administered
according to and its validity shall be determined under, the laws of such State,
except where preempted by federal laws.


     16.   Counterparts.   This  Agreement  may  be  executed  in  one  or  more
counterparts, each of which shall constitute one and the same instrument.

     IN WITNESS WHEREOF, Hansen Natural Corporation has caused this Agreement to
be executed by a duly authorized  officer and Holder has executed this Agreement
both as of the day and year first above written.

                                        HANSEN NATURAL CORPORATION

                                        By: /s/RODNEY SACKS
                                        Title:  Chairman of the Board

          Mark J. Hall