This Option (or shares underlying this Option) has not been registered
under the Securities Act of 1933 ("the Act"). This Option may not be sold,
assigned, or transferred in the absence of an effective registration
statement under the Act unless done pursuant to an exemption from
registration.
BALANCED LIVING, INC.
OPTION AGREEMENT
THIS OPTION AGREEMENT is entered into effective as of July 15, 1998 between
Balanced Living, Inc., a Colorado Corporation (hereinafter referred to as
"Optionor"), and Xxxxxx X. Xxxxxx, a founder of Optionor, (hereinafter
referred to as "Optionee")
RECITALS:
WHEREAS, Optionor has 50,000,000 authorized shares of $.001 par value
Common Stock, and
WHEREAS, the undersigned Optionor's shares of Common Stock have little or
no market value and the Optionor being a start-up company, and
WHEREAS the Optionee is a founder of the Company and desires to obtain an
option to acquire shares of the Optionor's Common Stock from Optionor upon
the terms and conditions set forth herein.
NOW THEREFORE, the parties hereto agree as follows:
1. Grant of Option. Optionor hereby grants an option ("Option") to
Optionee to acquire 50,000 (fifty thousand) shares of the Optionor's Common
Stock (hereinafter referred to as the "Option Stock")
2. Consideration. In consideration of the foregoing grant of option,
Optionee does hereby pay the sum of $500.00 (five hundred dollars) as
payment in full for said grant of option. Optionor hereby acknowledges
receipt to said payment as of the date of execution hereof.
3. Vesting. The Optionee will vest in options for 10,000 shares of
Option Stock for every year, from the date of this Option Agreement, that
the Optionee is still actively involved in the development of the Optionor
and has meet the requirements of the Optionor's Founders Guideline
Agreement ("FGA") which is to be attached hereto. The Board of Directors
will each year review the Optionee's involvement and fulfillment of FGA
requirements before approving the Optionee's vesting in options for 10,000
shares of Option Stock.
4. Notice of Exercise. Upon written notice in the form of the attached
Election to Exercise or in such other form as may be approved by the
Company, accompanied by payment in good funds payable to Optionor, the
Option may be exercise in whole or in part and in accordance with all other
terms and conditions hereof. Upon receipt of notice of exercise and payment
of the purchase price, Optionor shall, as soon as practicable, deliver the
Option Stock, as duly purchased, to the Optionor's transfer agent for
transfer and delivery to Optionee. The Option Stock shall be accompanied
with appropriate cover letter from the Optionor to the transfer agent of
the Optionor requesting transfer of the Option Stock to the names
designated by Optionee and requesting delivery directly to the Optionee.
Payment for the cost of transfer shall be made by Optionee.
5. Exercise Price. Optionee agrees to pay a total exercise price of
$50,000.00 (Fifty Thousand dollars) upon exercise of all the Option Stock.
Upon exercise of any portion less that all of the Option Stock, Optionee
agrees to pay that percentage of the total exercise price which is equal to
the percentage which the stock being exercise is of the total amount of
Option Stock.
6. Option Period. This Option must be exercised in accordance with the
terms and conditions set forth herein within five years from the date
hereof. Otherwise, such Option shall expire without further notice unless
mutually agreed by the parties.
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7. Representations and Warranties. Optionor hereby represents that said
shares will be reserved from the authorized and unissued Common Stock of
the Optionor and when exercised, Optionor hereby represents that said stock
will be validly issued, fully paid and not assessable.
8. Ownership of Rights. The Optionee shall have no rights as a
shareholder with respect to any shares covered by his option until the date
of issuance of a stock certificate to said optionee for such shares. No
adjustment shall be made for dividends (ordinary or extraordinary, whether
in cash, securities or other property) or distributions or other rights for
which the record date is prior to the date such stock certificate is
issued, except as provided under the terms and conditions of this
Agreement.
9. Corporate Recapitalization, Stock Splits, Adjustments, etc. In the
event that the number of outstanding shares of Common Stock of the Optionor
is changed by a stock dividend, stock split, reverse stock split,
combination, reclassification or similar change in the capital structure,
the number of shares subject to the terms of this Option shall be
proportionally adjusted, as shall the price for the shares.
10. Assignability. Optionee designated below may assign all of its rights
hereunder to related entities such as whollv-owned corporations. pension
and profitsharing plans. Optionee may assign no more than two thirds of its
Option under this Agreement to unrelated parties without the consent of
Optionor by providing written notice of such assignment and the name and
address of such assignee to the Option prior to the time of exercise.
Notwithstanding the foregoing, no portion of this Option may be assigned to
any person unless such person executes a written acknowledgment of all
other terms and conditions hereof. Said assignments shall only be made to
no more than an aggregate number of 10 (ten) persons, all of whom must be
sophisticated or accredited investors.
11. Nonpublic Nature of Transaction. The grant of this Option does not
involve any public solicitation or advertisement and was privately
negotiated on an arms length basis. The Optionee is a sophisticated
investor and experienced in purchase of securities. The Option is acquired
for investment purposes for Optionee's own account and not for public
distribution. The Option will not be assigned or distributed except by
registration under The Act or an exemption therefrom. The Optionee
acknowledges that the grant of Option has not been registered under The Act
and the Option is a "restricted security" within the meaning of The Act.
12. Disclosure Obligations. Optionee and Optionor must take all steps
reasonably required to assure that the shareholders of the Optionor, the
public and the financial community is informed with regard to the existence
of the Option and the relevant terms hereof.
13. Tax Consequences. Exercise of this Option or any portion thereof
and/or disposition of shares acquired under this Option may create a tax
liability for Optionee. Tax laws and regulations are subject to change,
therefore Optionee should consult a tax advisor before exercising this
Option or disposing of the shares.
14. Notices. Any notice required or permitted to be given hereunder shall
be sufficient if mailed, postage prepaid, to the respective parties at the
addresses set forth herein.
15. Construction. This Agreement shall be construed and interpreted in
accordance with the State of Colorado.
16. Default. In the event of any default hereunder, the non defaulting
party shall be entitled to reimbursement of all costs including reasonable
attorneys' fees, incurred in enforcing this Agreement, whether with or
without suit.
17. Further Assurances. At any time, and from time to time, after the
execution hereof, each party will execute such additional instruments and
take such action as may be reasonably requested by the other party to
confirm or perfect title to any property transferred hereunder or otherwise
to carry out the intent and purposes of this Agreement.
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18. Counterparts. This Agreement may be executed in Counterparts, all of
which shall constitute on and the same agreement.
19. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the respective parties and their heirs, successors and assigns.
IN WITNESS WHEREOF, the parties have executed this Agreement to be
effective as of the day and year first above written.
OPTIONEE:
Xxxxxx X. Xxxxxx
0000 Xxx Xxxxxx Xxxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
/s/Xxxxxx X. Xxxxxx
Date: July 15, 1998
OPTIONOR:
Balanced Living, Inc.
0000 Xx. Xxxxxxxx Xxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
/s/ Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxxxx, President
Date: July 15, 1998
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ELECTION TO EXERCISE
Balanced Living, Inc.
(To be delivered when exercising vested option stock)
The undersigned, being the Registered Holder of the attached
Stock Option Agreement in shares of option stock of Balanced
Living, Inc. (the "Company"), hereby irrevocably elects to exercise such
option stock with respect to shares of the Common Stock of the
Company and herewith tenders payment for such shares in cash or by certified
or official bank check payable to the order of the Company or has made a
wire transfer to the Company of good funds in the amount of
and in accordance with the terms hereof. The undersigned requests that a
certificate for such shares be registered in the name of
whose addressis at and that such
certificate be delivered to whose address is
at .
If said number of shares is less than all of the shares
purchasable hereunder, the undersigned requests that the Company endorse
on the Option Agreement the number of shares for which it remains
exercisable and return it to whose address is
at .
Dated:
Signed:
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