[FORM OF]
STOCK OPTION AGREEMENT
UNDER THE BLUESTAR HEALTH, INC.
2004 NON-QUALIFIED STOCK GRANT AND OPTION PLAN
THIS STOCK OPTION AGREEMENT is entered into the ____ day of _____________,
20__, between Bluestar Health, Inc., a Colorado corporation (the "Corporation"
or "Grantor") and [GRANTEE NAME] (the "Grantee"), with respect to the following
facts:
Pursuant and subject to the Corporation's 2004 Non-Qualified Stock Grant
and Option plan, a copy of which is attached hereto as Exhibit A and
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incorporated herein by this reference (the "Plan"), the Corporation's Board of
Directors has determined that it is to the advantage and interest of the
Corporation and its stockholders to grant the option provided for herein to
Grantee. The parties agree as follows:
1. GRANT OF OPTION: For value received, the Corporation hereby grants
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to Grantee the right and option to purchase, on the terms and conditions
hereinafter set forth, an aggregate of ____________ shares of the Corporations
Common Stock. The purchase price shall be $___________ per share.
2. TIME AND MANNER OF EXERCISE: [From and after January 1, ______, and
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during each of the four (4) succeeding one-year periods commencing on the
anniversary thereof, Grantee shall have the right to purchase from Grantor
twenty percent (20%) of the aggregate number of shares of Common Stock of
Grantor subject to this Option, on a cumulative basis (total ____________
shares)]. The purchase shall be made upon delivery to Grantor of a notice of
exercise accompanied by a certified or cashier's check in payment of the
aggregate option price, or Grantee's promissory note in the form of Exhibit B
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hereto, secured by a pledge of the shares purchased. Promptly upon receipt of
such material, Grantor will deliver to Grantee stock certificate(s) representing
the number of shares purchased in accordance with the foregoing and during
Grantee's lifetime, duly registered in the name(s) of Grantee and, at Grantee's
election, his or her spouse. The failure to exercise an option with respect to
any shares of Grantor's Common Stock for which the right has accrued during any
one-year period shall not result in the termination of the option with respect
to such shares of Stock; rather the same shall cumulate and be eligible for
exercise during the remainder of the option term.
3. ANTIDILUTION PROVISIONS: The number of shares that Grantee is
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entitled to purchase upon the exercise of this Option and the purchase price of
those shares are subject only to the adjustments set forth in Section 5.6 of the
Plan.
4. INVESTMENT UNDERTAKING; NONASSIGNABILITY: This Option may be
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exercised only by Grantee during his or her lifetime. Grantee will hold this
Option and the rights arising hereunder for investment and not with a view to
distribution, and upon exercise will deliver a letter confirming Grantee's
nondistributive
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intent with respect to the shares of Common Stock received. Grantee will not
transfer or assign this Option, except by will or the laws of intestate
succession.
5. EXPIRATION: This Option shall terminate and expire at midnight on
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the date that is [seven (7)] years after the date of this Agreement, or four (4)
months after the date that Grantee ceases to be eligible to participate in the
Plan in accordance with Section 3 of the Plan, whichever is earlier. However,
if Grantee dies while still eligible to participate in the Plan, his or her
executor(s) or administrator(s), or any person or persons who acquired the
Option from the Grantee by bequest or inheritance, shall, during the 12-month
period commencing on the date of the Grantee's death, have the right to exercise
this Option with respect to the shares that remain subject to this Option on
that date, subject to the conditions that this Option (i) shall in no event be
exercisable after its expiration in accordance with this Section 5 and (ii) it
shall be exercisable by such representative(s) or successor(s) only to the
extent that the Grantee's right to exercise this Option had accrued pursuant to
Paragraph 2 hereof at the time of the Grantee's death and had not previously
been exercised. Any options not exercisable or not exercised prior to the end
of such 12-month period shall be automatically null and void.
6. BUY-OUT AGREEMENT:
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[The Stock purchased by the Grantee upon exercise of this Option shall be
subject to the Buy-Out Agreement, a copy of which is attached hereto as Exhibit
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C]
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[Grantee agrees that he or she will not dispose of or encumber any shares
in the Corporation acquired pursuant to this Option, except as is required under
the following provisions:
(a) If Grantee's employment with the Corporation terminates prior to
______________ (e.g., five (5) years from date hereof), for any reason other
than his or her death or total permanent disability, Grantee shall sell and the
Corporation shall purchase all shares of stock of the Corporation owned by
Grantee at the price of $_____ per share.
OR,
(b) If Grantee's employment with the Corporation terminates prior to
_______________ (e.g., five (5) years from the date hereof), on account of
Grantee's death or total permanent disability, on and after such termination
Grantee or Grantee's estate shall sell and the Corporation shall purchase all
shares of stock of the Corporation acquired by Grantee pursuant to this
Agreement at the price of $_____ per share. Said sale and purchase shall be
made not later than sixty (60) days after Grantee's termination of employment,
or, if terminated by Grantee's death, within sixty (60) days after the
appointment of a legal representative for Grantee's estate.]
7. REPRESENTATIONS OF GRANTOR: So long as this Option remains
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outstanding and unexpired, Grantor will reserve for issuance upon the exercise
of this
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Option the number of shares of Grantor's Common Stock that are subject to this
Option. The shares of Common Stock of Grantor subject to this Option shall,
when issued, be validly issued, fully paid and nonassessable. Grantor will pay,
when due and payable, any and all federal and state taxes or fees that may be
payable by Grantor with respect to the grant of this Option or the issuance of
any shares of Common Stock or certificates therefore subject to this Option.
However, this does not include any federal, state or other personal income tax
payable by the Grantee by virtue of (i) the grant of this Option; (ii) the
issuance of any share of Common Stock upon exercise thereof; or (iii) any
subsequent disposition of such shares which shall remain the obligation of the
Grantee.
8. WITHHOLDING TAXES: If the Corporation determines that it is
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required to withhold federal, state or local tax as a result of the exercise of
this Option, the Grantee, as a condition to the exercise of this Option, shall
make arrangements satisfactory to the Corporation to enable it to satisfy such
withholding requirements.
9. NOTICE: Any notice, request, or instructions given in connection
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with this Option shall be in writing and shall be delivered in person or by
certified mail as follows:
(a) If to Grantor, at ______________________________, [State],
Attention: Corporate Secretary.
(b) If to Grantor, at ___________________________, or at such
other address as either of the parties shall have given notice to the other in
accordance with the provisions hereof.
10. COMMITTEE DETERMINATION FINAL: The interpretation and construction
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of the Plan and this Stock Option Agreement, including any inconsistency between
the two documents, shall be reserved to and made by the Committee of the Board
of Directors provided for under the Plan. The Committee's determinations shall
be final as between the parties hereto unless otherwise determined by the Board
of Directors of Grantor.
11. GOVERNING LAW: This Option is granted and delivered in the State
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of Texas and is intended to be construed and enforced under the laws thereof.
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IN WITNESS WHEREOF, this Option is executed on behalf of Grantor and its
duly authorized officers and by Grantee as of this ___ day of _____________,
20__.
GRANTOR:
Bluestar Health, Inc.,
a Colorado corporation
___________________________________
By:________________________________
Its:_______________________________
GRANTEE
_____________________________
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EXHIBIT "A"
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NON-QUALIFIED STOCK OPTION PLAN
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EXHIBIT "B"
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FORM OF PROMISSORY NOTE
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EXHIBIT "C"
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BUY-OUT AGREEMENT
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