Exhibit 10.1

 

NONSTATUTORY STOCK OPTION AGREEMENT

 

UNDER THE REED’S, INC.

SECOND AMENDED AND RESTATED 2017 INCENTIVE COMPENSATION PLAN

 

(Non-Employee Director)

 

This NONSTATUTORY STOCK OPTION AGREEMENT (the “Agreement”) is between Reed’s
Inc., a Delaware corporation (the “Company”), and the individual optionee
specified below (the “Optionee”), and is made and effective as of _____, 2020
(the “Effective Date”). Capitalized terms not defined herein shall have the
meanings ascribed to them in the Reed’s, Inc. Amended and Restated 2017
Incentive Compensation Plan (the “Plan”).

 

1.Notice of Stock Option Grant.

 

The Company, pursuant to action of the Committee and in accordance with the
Plan, grants to Optionee a Nonstatutory Stock Option (the “Option”) to purchase
common stock of the Company, $0.0001 par value per share (the “Option Shares”),
upon the terms and conditions set forth in this Agreement:

 

Name of Optionee       Total Number of Option Shares       Option Price      
Grant Date       Vesting Date       Expiration Date  

 

No portion of this Option may be exercised until such portion shall have become
exercisable. Subject to the discretion of the Committee to accelerate the
exercisability schedule hereunder, this Option shall be exercisable with respect
to the number of Option Shares on the dates indicated above. Once exercisable,
this Option shall continue to be exercisable at any time or times prior to the
close of business on the Expiration Date (set forth above), subject to the
provisions hereof and of the Plan. If the number of Option Shares would result
in the issuance of a fraction of a share, no fractional share shall be issued
and instead the number of Option Shares shall be increased or decreased to the
nearest whole number.

 

NONSTATUTORY STOCK OPTION AGREEMENT1

 

 

2. Manner of Exercise.

 

(a) The Option may only be exercised in accordance with the terms of the Plan
and the administrative procedures established by the Company and/or the
Committee from time to time. The exercise of the Option is subject to the
Optionee making appropriate tax withholding arrangements with the Company in
accordance with the terms of the Plan and the administrative procedures
established by the Company and/or the Committee from time to time.

 

(b) The transfer to the Optionee on the records of the Company or of the
transfer agent of the Option Shares will be contingent upon (i) the Company’s
receipt from the Optionee of the full purchase price for the Option Shares, (ii)
the fulfillment of any other requirements prescribed by the Committee, contained
herein and in the Plan or in any other agreement or provision of laws, and (iii)
the receipt by the Company of any agreement, statement or other evidence that
the Company may require to satisfy itself that the issuance of Option Shares to
be purchased pursuant to the exercise of Options under the Plan and any
subsequent resale of the Option Shares will be in compliance with applicable
laws and regulations.

 

(c) The Option Shares purchased upon exercise of this Option shall be
transferred to the Optionee on the records of the transfer agent upon
compliance, to the satisfaction of the Committee, with all requirements
prescribed by the Committee and required under applicable laws or regulations in
connection with such transfer and with the requirements hereof and of the Plan.
The determination of the Committee as to such compliance shall be final and
binding on the Optionee. The Optionee shall not be deemed to be the holder of,
or to have any of the rights of a holder with respect to, any Option Shares
subject to this Option unless and until this Option shall have been exercised
pursuant to the terms hereof, the Company or the transfer agent shall have
transferred the shares to the Optionee, and the Optionee’s name shall have been
entered as the stockholder of record on the books of the Company. Thereupon, the
Optionee shall have full voting, dividend and other ownership rights with
respect to such Option Shares.

 

(d) No partial exercise of an Option shall be for an aggregate exercise price of
less than $1,000.00, unless this minimum is waived by the Committee.

 

(e) Notwithstanding any other provision hereof or of the Plan, no portion of
this Option shall be exercisable after the Expiration Date hereof.

 

3. Adjustment upon Changes in Capitalization. The Option is subject to
adjustment in the event of certain changes in the capitalization of the Company,
to the extent set forth in Section 9 of the Plan.

 

4. Incorporation of Plan. Notwithstanding anything herein to the contrary, this
Option shall be subject to and governed by all the terms and conditions of the
Plan, including the powers of the Committee set forth in Section 4 of the Plan.
Capitalized terms in this Agreement shall have the meaning specified in the
Plan, unless a different meaning is specified herein. If there is a conflict
between the provisions of this Agreement and the provisions of the Plan, the
provisions of the Plan will govern.

 

5. Termination of Services. If the Optionee’s service as a director terminates,
the period within which to exercise the Option may be subject to earlier
termination as set forth below.

 

(a) If Optionee’s service as a director terminates prior to the Option’s
Expiration Date, for any reason whatsoever other than death, any unexercised
portion of the Option shall expire three months after the Optionee’s termination
date.

 

NONSTATUTORY STOCK OPTION AGREEMENT2

 

 

(b) If prior to the Expiration Date of the Option, the Optionee’s services as a
director terminate due to death of Optionee, the Optionee’s estate, heirs or
legatees shall have the privilege of exercising all of the unexercised Option
within six months after the Optionee’s death.

 

Nothing contained in this Section shall extend the time for exercising all or
any part of the then unexercised portion of an Option.

 

6. Acceleration of Vesting upon Change-in-Control. Upon the occurrence of a
Change-in-Control, all unvested Option Shares then outstanding shall immediately
become fully vested and fully exercisable as of the effective date of such
Change-in-Control.

 

7. Transferability. This Agreement is personal to the Optionee. The Option may
not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any
manner other than by will or by the laws of descent or distribution and may be
exercised, during the lifetime of an Optionee, only by Optionee. Upon the death
of Optionee, the outstanding Option granted to such Optionee may be exercised
only by the executors or administrators of the Optionee’s estate or by any
person or persons who shall have acquired such right to exercise by will or by
the laws of descent and distribution. No transfer by will or the laws of descent
and distribution of this Option, or the right to exercise any Option, shall be
effective to bind the Company unless the Committee shall have been furnished
with (a) written notice thereof and with a copy of the will and/or such evidence
as the Committee may deem necessary to establish the validity of the transfer,
and (b) an agreement by the transferee to comply with all the terms and
conditions of the Option that are or would have been applicable to the Option
and to be bound by the acknowledgements made by the Optionee in connection with
the grant of the Option.

 

8. Status of the Option. This Option is not intended to be an “incentive stock
option” within the meaning of section 422 of the Code, and therefore is a
non-qualified stock option.

 

9. Tax Withholding. The Optionee shall, not later than the date as of which the
exercise of this Option becomes a taxable event for Federal income tax purposes,
pay to the Company or make arrangements satisfactory to the Committee for
payment of any Federal, state, and local taxes required by law to be withheld on
account of such taxable event. The Company shall have the authority to cause the
required tax withholding obligation to be satisfied, in whole or in part, by
withholding from Option Shares to be issued to the Optionee a number of Option
Shares with an aggregate fair market value that would satisfy the withholding
amount due; provided, however, that the amount withheld does not exceed the
maximum statutory tax rate or such lesser amount as is necessary to avoid
adverse accounting treatment or as determined by the Committee.

 

10. Integration. This Agreement and the Plan constitute the entire agreement
between the parties with respect to this Option and supersede all prior
agreements and discussions between the parties concerning such subject matter.

 

11. Data Privacy Consent. In order to administer the Plan and this Agreement and
to implement or structure future equity grants, the Company, its Subsidiaries
and affiliates and certain agents thereof (together, the “Relevant Companies”)
may process any and all personal or professional data, including but not limited
to social security or other identification number, home address and telephone
number, date of birth and other information that is necessary or desirable for
the administration of the Plan and/or this Agreement (the “Relevant
Information”). By entering into this Agreement, the Optionee (i) authorizes the
Company to collect, process, register and transfer to the Relevant Companies all
Relevant Information, (ii) waives any privacy rights the Optionee may have with
respect to the Relevant Information, (iii) authorizes the Relevant Companies to
store and transmit such information in electronic form, and (iv) authorizes the
transfer of the Relevant Information to any jurisdiction in which the Relevant
Companies consider appropriate. The Optionee shall have access to, and the right
to change, the Relevant Information. Relevant Information will only be used in
accordance with applicable law.

 

NONSTATUTORY STOCK OPTION AGREEMENT3

 

 

12. Notices. Notices hereunder shall be mailed or delivered to the Company at
its principal place of business and shall be mailed or delivered to the Optionee
at the address on file with the Company or, in either case, at such other
address as one party may subsequently furnish to the other party in writing.

 

13. Governing Law. This Agreement and the rights of all persons claiming
hereunder will be construed and determined in accordance with the laws of the
State of Delaware without giving effect to the choice of law principles thereof.

 

14. Blackout Periods. The Optionee acknowledges that, from time to time as
determined by the Company in its sole discretion, the Company may establish
“blackout periods” during which this Option may not be exercised. The Company
may establish a blackout period for any reason or for no reason.

 

15. Other Laws. The Company shall have the right to refuse to issue or transfer
any Option Shares under this Agreement if the Company acting in its absolute
discretion determines that the issuance or transfer of such Option Shares might
violate any applicable law or regulation, and any payment tendered in such event
to exercise this Option shall be promptly refunded to the Optionee.

 

16. Investment Intent. The Company may request the Optionee to hold any Option
shares received upon the exercise of all or part of the Option for personal
investment and not for purposes of resale or distribution to the public and the
Optionee shall, if so requested by the Company, deliver a certified statement to
that effect to the Company as a condition to the transfer of such Option Shares
to the Optionee.

 

17. Compliance. In addition to the remedies of the Company elsewhere provided
for herein, failure by Optionee to comply with any of the terms and conditions
of the Plan or this Agreement, unless such failure is remedied by such Optionee
within ten (10) days after having been notified of such failure by the
Committee, shall be grounds for the cancellation and forfeiture of such Option,
in whole or in part, as the Committee, in its absolute discretion, may
determine.

 

18. Severability. If any provision hereof is found by a court of competent
jurisdiction to be prohibited or unenforceable, it shall, as to such
jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability, and such prohibition or unenforceability shall not invalidate
the balance of such provision to the extent it is not prohibited or
unenforceable, nor invalidate the other provisions hereof.

 

19. Arbitration. If at any time there shall be a dispute arising out of or
relating to any provision of this Agreement or any agreement contemplated
hereby, such dispute shall be submitted for binding and final determination by
arbitration in accordance with the regulations then obtaining of the American
Arbitration Association. Judgment upon the award rendered by the arbitrator(s)
resulting from such arbitration shall be in writing and shall be final and
binding upon all involved parties. The site of any arbitration shall be within
Norwalk, Connecticut.

 

[signature page follows]

 

NONSTATUTORY STOCK OPTION AGREEMENT4

 

 

By the Optionee’s signature and the signature of the Company’s representative
below, the Optionee and the Company agree that this Option is granted under and
governed by the terms and conditions of this Agreement and the Plan. The
Optionee has reviewed this Agreement and the Plan in their entirety, has had an
opportunity to obtain the advice of counsel before executing this Agreement and
fully understands all provisions of this Agreement and the Plan. The Optionee
hereby agrees to accept as binding, conclusive, and final all decisions or
interpretations of the Committer upon any questions relating to this Agreement
and the Plan.

 

 

REED’S, INC.

                   By:    

Name:

   

Title:

 

 

The foregoing Agreement is hereby accepted, and the terms and conditions thereof
hereby agreed to by the undersigned Optionee. Electronic acceptance of this
Agreement pursuant to the Company’s instructions to the Optionee (including
through an online acceptance process) is acceptable. The Optionee further agrees
that the Company may deliver all documents relating to the Plan or this Option
(including prospectuses required by the Securities and Exchange Commission), and
all other documents that the Company is required to deliver to its security
holders or the Optionee (including annual reports, proxy statements and
financial statements), either by e-mail or by e-mail notice of a website
location where those documents have been posted. The Optionee may at any time
(i) revoke this consent to e-mail delivery of those documents, (ii) update the
e-mail address for delivery of those documents, and (iii) obtain at no charge a
paper copy of those documents, in each case by writing the Company at its
principal place of business. The Optionee may request an electronic copy of any
of those documents by requesting a copy in writing from the Company. The
Optionee understands that an e-mail account and appropriate hardware and
software, including a computer or compatible cell phone and an Internet
connection, will be required to access documents delivered by e-mail.

 

  OPTIONEE       Signature:________________________________________   Printed
Name:_____________________________________   Optionee’s address:  
_______________________________________________  
_______________________________________________

 

NONSTATUTORY STOCK OPTION AGREEMENT5