<PAGE>

                                                                    EXHIBIT 10.2

      THIS OPTION AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THE
      OPTION HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
      AMENDED, OR ANY STATE SECURITIES LAWS. THIS OPTION AND THE COMMON STOCK
      ISSUABLE UPON EXERCISE OF THIS OPTION MAY NOT BE SOLD, OFFERED FOR SALE,
      PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
      STATEMENT AS TO THIS OPTION UNDER SAID ACT AND ANY APPLICABLE STATE
      SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
      NATURADE, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.

           Right to Purchase up to 8,721,375 Shares of Common Stock of
                                 Naturade, Inc.
                   (subject to adjustment as provided herein)

                                     OPTION

No. _________________                                  Issue Date: July 26, 2005

      NATURADE, INC., a Delaware corporation (the "Parent"), hereby certifies
that, for value received, LAURUS MASTER FUND, LTD., or assigns (the "Holder"),
is entitled, subject to the terms set forth below, to purchase from the Parent
(as defined herein) from and after the Issue Date of this Option and at any time
or from time to time, up to 8,721,375 fully paid and nonassessable shares of
Common Stock (as hereinafter defined), $0.0001 par value per share, at the
applicable Exercise Price per share (as defined below). The number and character
of such shares of Common Stock and the applicable Exercise Price per share are
subject to adjustment as provided herein.

      As used herein the following terms, unless the context otherwise requires,
have the following respective meanings:

            (a) The term "Parent" shall include Naturade, Inc. and any
      corporation that shall succeed, or assume the obligations of, Naturade,
      Inc. hereunder.

            (b) The term "Common Stock" includes (i) the Parent's Common Stock,
      $0.0001 par value per share; and (ii) any other securities into which or
      for which any of the securities described in (a) may be converted or
      exchanged pursuant to a plan of recapitalization, reorganization, merger,
      sale of assets or otherwise.

            (c) The "Exercise Price" applicable under this Option shall be a
      price of $0.0001 per share.

            (d) The term "Other Securities" refers to any stock (other than
      Common Stock) and other securities of the Parent or any other person
      (corporate

<PAGE>

      or otherwise) which the Holder at any time shall be entitled to receive,
      or shall have received, on the exercise of the Option, in lieu of or in
      addition to Common Stock, or which at any time shall be issuable or shall
      have been issued in exchange for or in replacement of Common Stock or
      Other Securities pursuant to Section 4 or otherwise.

      1. Exercise of Option.

            1.1 Number of Shares Issuable upon Exercise. From and after the date
hereof, the Holder shall be entitled to receive, upon exercise of this Option in
whole or in part, by delivery of an original or fax copy of an exercise notice
in the form attached hereto as Exhibit A (the "Exercise Notice"), shares of
Common Stock of the Parent, subject to adjustment pursuant to Section 4.
Notwithstanding anything contained herein to the contrary, the Holder shall not
be entitled to convert pursuant to the terms of this Option an amount that would
be convertible into that number of Conversion Shares which would exceed the
difference between (i) 4.99% of the issued and outstanding shares of Common
Stock and (ii) the number of shares of Common Stock beneficially owned by the
Holder, issuable to the Holder upon exercise of the Warrants and issuable to the
Holder upon exercise of the Options. For purposes of the immediately preceding
sentence, beneficial ownership shall be determined in accordance with Section
13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Conversion Shares
limitation described in this Section 1.1 shall automatically become null and
void following notice to the Parent upon the occurrence and during the
continuance of an Event of Default, or upon 75 days prior notice to the Parent,
except that at no time shall the number of shares of Common Stock beneficially
owned by the Holder exceed 19.99% of the outstanding shares of Common Stock.
Notwithstanding anything contained herein to the contrary, the provisions of
this Section 1.1 are irrevocable and may not be waived by the Holder or the
Parent.

            1.2 Fair Market Value. For purposes hereof, the "Fair Market Value"
of a share of Common Stock as of a particular date (the "Determination Date")
shall mean:

            (a) If the Parent's Common Stock is traded on the American Stock
      Exchange or another national exchange or is quoted on the National or
      SmallCap Market of The Nasdaq Stock Market, Inc. ("Nasdaq"), then the
      closing or last sale price, respectively, reported for the last business
      day immediately preceding the Determination Date.

            (b) If the Parent's Common Stock is not traded on the American Stock
      Exchange or another national exchange or on the Nasdaq but is quoted on
      the NASD Over The Counter Bulletin Board, then the mean of the average of
      the closing bid and asked prices reported for the last business day
      immediately preceding the Determination Date.

            (c) Except as provided in clause (d) below, if the Parent's Common
      Stock is not publicly traded, then as the Holder and the Parent agree or
      in the

                                        2

<PAGE>

      absence of agreement by arbitration in accordance with the rules then in
      effect of the American Arbitration Association, before a single arbitrator
      to be chosen from a panel of persons qualified by education and training
      to pass on the matter to be decided.

            (d) If the Determination Date is the date of a liquidation,
      dissolution or winding up, or any event deemed to be a liquidation,
      dissolution or winding up pursuant to the Parent's charter, then all
      amounts to be payable per share to holders of the Common Stock pursuant to
      the charter in the event of such liquidation, dissolution or winding up,
      plus all other amounts to be payable per share in respect of the Common
      Stock in liquidation under the charter, assuming for the purposes of this
      clause (d) that all of the shares of Common Stock then issuable upon
      exercise of the Option are outstanding at the Determination Date.

            1.3 Parent Acknowledgment. The Parent will, at the time of the
exercise of the Option, upon the request of the Holder hereof acknowledge in
writing its continuing obligation to afford to such Holder any rights to which
such Holder shall continue to be entitled after such exercise in accordance with
the provisions of the Option. If the Holder shall fail to make any such request,
such failure shall not affect the continuing obligation of the Parent to afford
to such Holder any such rights.

            1.4 Trustee for Option Holders. In the event that a bank or trust
company shall have been appointed as trustee for the Holder of the Option
pursuant to Subsection 3.2, such bank or trust company shall have all the powers
and duties of an option agent (as hereinafter described) and shall accept, in
its own name for the account of the Parent or such successor person as may be
entitled thereto, all amounts otherwise payable to the Parent or such successor,
as the case may be, on exercise of this Option pursuant to this Section 1.

      2. Procedure for Exercise.

            2.1 Delivery of Stock Certificates, Etc., on Exercise. The Parent
agrees that the shares of Common Stock purchased upon exercise of this Option
shall be deemed to be issued to the Holder as the record owner of such shares as
of the close of business on the date on which this Option shall have been
surrendered and payment made for such shares in accordance herewith. As soon as
practicable after the exercise of this Option in full or in part, and in any
event within three (3) business days thereafter, the Parent at its expense
(including the payment by it of any applicable issue taxes) will cause to be
issued in the name of and delivered to the Holder, or as such Holder (upon
payment by such Holder of any applicable transfer taxes) may direct in
compliance with applicable securities laws, a certificate or certificates for
the number of duly and validly issued, fully paid and nonassessable shares of
Common Stock (or Other Securities) to which such Holder shall be entitled on
such exercise, plus, in lieu of any fractional share to which such Holder would
otherwise be entitled, cash equal to such fraction multiplied by the then Fair
Market Value of one full share, together with any other stock or other
securities and property (including cash, where applicable) to which such Holder
is entitled upon such exercise pursuant to Section 1 or otherwise.

                                        3

<PAGE>

      2.2 Exercise.

            (a) Subject to subsection (b) below, payment shall be made in cash
      or by certified or official bank check payable to the order of the Parent
      equal to the applicable aggregate Exercise Price for the number of Common
      Shares specified in such Exercise Notice (as such exercise number shall be
      adjusted to reflect any adjustment in the total number of shares of Common
      Stock issuable to the Holder per the terms of this Option) and the Holder
      shall thereupon be entitled to receive the number of duly authorized,
      validly issued, fully-paid and non-assessable shares of Common Stock (or
      Other Securities) determined as provided herein.

            (b) Notwithstanding any provisions herein to the contrary, in the
      event there is no effective registration statement with respect to the
      shares issuable upon exercise of this Option or a Default or an Event of
      Default (as such terms are defined in the Security Agreement dated as of
      the date hereof among the Holder and the Parent, as amended, modified,
      restated and/or supplemented from time to time),) has occurred and is
      continuing, if the Fair Market Value of one share of Common Stock is
      greater than the Exercise Price (at the date of calculation as set forth
      below), in lieu of exercising this Option for cash, the Holder may elect
      to receive shares equal to the value (as determined below) of this Option
      (or the portion thereof being exercised) by surrender of this Option at
      the principal office of the Parent together with the properly endorsed
      Exercise Notice in which event the Parent shall issue to the Holder a
      number of shares of Common Stock computed using the following formula:

      X=Y (A-B)/A

      Where X = the number of shares of Common Stock to be issued to the Holder

      Y=    the number of shares of Common Stock purchasable under the Option
            or, if only a portion of the Option is being exercised, the portion
            of the Option being exercised (at the date of such calculation)

      A=    the Fair Market Value of one share of the Parent's Common Stock (at
            the date of such calculation)

      B=    Exercise Price (as adjusted to the date of such calculation)

      3. Effect of Reorganization, Etc.; Adjustment of Exercise Price.

            3.1 Reorganization, Consolidation, Merger, Etc. In case at any time
or from time to time, the Parent shall (a) effect a reorganization, (b)
consolidate with or merge into any other person, or (c) transfer all or
substantially all of its properties or assets to any other person under any plan
or arrangement contemplating the dissolution of the Parent, then, in each such
case, as a condition to the consummation of such a

                                        4

<PAGE>

transaction, proper and adequate provision shall be made by the Parent whereby
the Holder, on the exercise hereof as provided in Section 1 at any time after
the consummation of such reorganization, consolidation or merger or the
effective date of such dissolution, as the case may be, shall receive, in lieu
of the Common Stock (or Other Securities) issuable on such exercise prior to
such consummation or such effective date, the stock and other securities and
property (including cash) to which such Holder would have been entitled upon
such consummation or in connection with such dissolution, as the case may be, if
such Holder had so exercised this Option, immediately prior thereto, all subject
to further adjustment thereafter as provided in Section 4.

            3.2 Dissolution. In the event of any dissolution of the Parent
following the transfer of all or substantially all of its properties or assets,
the Parent, concurrently with any distributions made to holders of its Common
Stock, shall at its expense deliver or cause to be delivered to the Holder the
stock and other securities and property (including cash, where applicable)
receivable by the Holder pursuant to Section 3.1, or, if the Holder shall so
instruct the Parent, to a bank or trust company specified by the Holder and
having its principal office in New York, NY as trustee for the Holder (the
"Trustee").

            3.3 Continuation of Terms. Upon any reorganization, consolidation,
merger or transfer (and any dissolution following any transfer) referred to in
this Section 3, this Option shall continue in full force and effect and the
terms hereof shall be applicable to the shares of stock and other securities and
property receivable on the exercise of this Option after the consummation of
such reorganization, consolidation or merger or the effective date of
dissolution following any such transfer, as the case may be, and shall be
binding upon the issuer of any such stock or other securities, including, in the
case of any such transfer, the person acquiring all or substantially all of the
properties or assets of the Parent, whether or not such person shall have
expressly assumed the terms of this Option as provided in Section 4. In the
event this Option does not continue in full force and effect after the
consummation of the transactions described in this Section 3, then the Parent's
securities and property (including cash, where applicable) receivable by the
Holders will be delivered to Holder or the Trustee as contemplated by Section
3.2.

      4. Extraordinary Events Regarding Common Stock. In the event that the
Parent shall (a) issue additional shares of the Common Stock as a dividend or
other distribution on outstanding Common Stock or any preferred stock issued by
the Parent, (b) subdivide its outstanding shares of Common Stock, or (c) combine
its outstanding shares of the Common Stock into a smaller number of shares of
the Common Stock (each of the preceding clauses (a) through (c), inclusive, an
"Event"), then, in each such event, the number of shares of Common Stock that
the Holder shall thereafter, on the exercise hereof as provided in Section 1, be
entitled to receive shall be increased or decreased to a number determined by
multiplying the number of shares of Common Stock that would, immediately prior
to such Event, be issuable upon the exercise of this Option by a fraction of
which (a) the numerator is the number of issued and outstanding shares of Common
Stock immediately after such Event, and (b) the denominator is the number of
issued and outstanding shares of Common Stock immediately prior to such Event.

                                        5

<PAGE>

      5. Certificate as to Adjustments. In each case of any adjustment or
readjustment in the shares of Common Stock (or Other Securities) issuable on the
exercise of the Option, the Parent at its expense will promptly cause its Chief
Financial Officer or other appropriate designee to compute such adjustment or
readjustment in accordance with the terms of the Option and prepare a
certificate setting forth such adjustment or readjustment and showing in detail
the facts upon which such adjustment or readjustment is based, including a
statement of (a) the consideration received or receivable by the Parent for any
additional shares of Common Stock (or Other Securities) issued or sold or deemed
to have been issued or sold, (b) the number of shares of Common Stock (or Other
Securities) outstanding or deemed to be outstanding, and (c) the Exercise Price
and the number of shares of Common Stock to be received upon exercise of this
Option, in effect immediately prior to such adjustment or readjustment and as
adjusted or readjusted as provided in this Option. The Parent will forthwith
mail a copy of each such certificate to the Holder and any Option agent of the
Parent (appointed pursuant to Section 10 hereof).

      6. Reservation of Stock, Etc., Issuable on Exercise of Option. The Parent
will at all times reserve and keep available, solely for issuance and delivery
on the exercise of the Option, shares of Common Stock (or Other Securities) from
time to time issuable on the exercise of the Option.

      7. Assignment; Exchange of Option. Subject to compliance with applicable
securities laws, this Option, and the rights evidenced hereby, may be
transferred by any registered holder hereof (a "Transferor") in whole or in
part. On the surrender for exchange of this Option, with the Transferor's
endorsement in the form of Exhibit B attached hereto (the "Transferor
Endorsement Form") and together with evidence reasonably satisfactory to the
Parent demonstrating compliance with applicable securities laws, which shall
include, without limitation, the provision of a legal opinion from the
Transferor's counsel (at the Parent's expense) that such transfer is exempt from
the registration requirements of applicable securities laws, and with payment by
the Transferor of any applicable transfer taxes) will issue and deliver to or on
the order of the Transferor thereof a new Option of like tenor, in the name of
the Transferor and/or the transferee(s) specified in such Transferor Endorsement
Form (each a "Transferee"), calling in the aggregate on the face or faces
thereof for the number of shares of Common Stock called for on the face or faces
of the Option so surrendered by the Transferor.

      8. Replacement of Option. On receipt of evidence reasonably satisfactory
to the Parent of the loss, theft, destruction or mutilation of this Option and,
in the case of any such loss, theft or destruction of this Option, on delivery
of an indemnity agreement or security reasonably satisfactory in form and amount
to the Parent or, in the case of any such mutilation, on surrender and
cancellation of this Option, the Parent at its expense will execute and deliver,
in lieu thereof, a new Option of like tenor.

      9. Registration Rights. The Holder has been granted certain registration
rights by the Parent. These registration rights are set forth in a Registration
Rights Agreement entered into by the Parent and Holder dated as of even date of
this Option.

                                        6

<PAGE>

      10. Option Agent. The Parent may, by written notice to each Holder of the
Option, appoint an agent for the purpose of issuing Common Stock (or Other
Securities) on the exercise of this Option pursuant to Section 1, exchanging
this Option pursuant to Section 7, and replacing this Option pursuant to Section
8, or any of the foregoing, and thereafter any such issuance, exchange or
replacement, as the case may be, shall be made at such office by such agent.

      11. Transfer on the Parent's Books. Until this Option is transferred on
the books of the Parent, the Parent may treat the registered holder hereof as
the absolute owner hereof for all purposes, notwithstanding any notice to the
contrary.

      12. Notices, Etc. All notices and other communications from the Parent to
the Holder shall be mailed by first class registered or certified mail, postage
prepaid, at such address as may have been furnished to the Parent in writing by
such Holder or, until any such Holder furnishes to the Parent an address, then
to, and at the address of, the last Holder who has so furnished an address to
the Parent.

      13. Miscellaneous. THIS OPTION AND ANY TERM HEREOF MAY BE CHANGED, WAIVED,
DISCHARGED OR TERMINATED ONLY BY AN INSTRUMENT IN WRITING SIGNED BY THE PARTY
AGAINST WHICH ENFORCEMENT OF SUCH CHANGE, WAIVER, DISCHARGE OR TERMINATION IS
SOUGHT. THIS OPTION SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS. Any
action brought concerning the transactions contemplated by this Option shall be
brought only in the state courts of New York or in the federal courts located in
the state of New York; provided, however, that the Holder may choose to waive
this provision and bring an action outside the state of New York. The
individuals executing this Option on behalf of the Parent agree to submit to the
jurisdiction of such courts and waive trial by jury. The prevailing party shall
be entitled to recover from the other party its reasonable attorney's fees and
costs. In the event that any provision of this Option is invalid or
unenforceable under any applicable statute or rule of law, then such provision
shall be deemed inoperative to the extent that it may conflict therewith and
shall be deemed modified to conform with such statute or rule of law. Any such
provision which may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision of this Option. The
headings in this Option are for purposes of reference only, and shall not limit
or otherwise affect any of the terms hereof. The invalidity or unenforceability
of any provision hereof shall in no way affect the validity or enforceability of
any other provision hereof. The Parent acknowledges that legal counsel
participated in the preparation of this Option and, therefore, stipulates that
the rule of construction that ambiguities are to be resolved against the
drafting party shall not be applied in the interpretation of this Option to
favor any party against the other party.

                   [BALANCE OF PAGE INTENTIONALLY LEFT BLANK;
                            SIGNATURE PAGE FOLLOWS.]

                                        7

<PAGE>

      IN WITNESS WHEREOF, the Parent has executed this Option as of the date
first written above.

                                             NATURADE, INC.

WITNESS:

                                             By: /s/ Stephen M. Kasprisin
                                                 ------------------------
                                             Name: Stephen M. Kasprisin
/s/Kim Kennedy                               Title: CFO
--------------

                                        8

<PAGE>

                                                                    EXHIBIT 10.2

                                   EXHIBIT A

                              FORM OF SUBSCRIPTION
                   (To Be Signed Only On Exercise Of Options)

TO: Naturade, Inc.

Attention: Chief Financial Officer

      The undersigned, pursuant to the provisions set forth in the attached
Option (No. ____), hereby irrevocably elects to purchase (check applicable box):

________ ________ shares of the Common Stock covered by such Option; or

________ the maximum number of shares of Common Stock covered by such Option
pursuant to the cashless exercise procedure set forth in Section 2.

      The undersigned herewith makes payment of the full Exercise Price for such
shares at the price per share provided for in such Option, which is
$___________. Such payment takes the form of (check applicable box or boxes):

________ $__________ in lawful money of the United States; and/or

________ the cancellation of such portion of the attached Option as is
exercisable for a total of _______ shares of Common Stock (using a Fair Market
Value of $_______ per share for purposes of this calculation); and/or

________ the cancellation of such number of shares of Common Stock as is
necessary, in accordance with the formula set forth in Section 2.2, to exercise
this Option with respect to the maximum number of shares of Common Stock
purchasable pursuant to the cashless exercise procedure set forth in Section 2.

      The undersigned requests that the certificates for such shares be issued
in the name of, and delivered to ____________________________________________
whose address is ___________________________________________________________.

<PAGE>

      The undersigned represents and warrants that all offers and sales by the
undersigned of the securities issuable upon exercise of the within Option shall
be made pursuant to registration of the Common Stock under the Securities Act of
1933, as amended (the "Securities Act") or pursuant to an exemption from
registration under the Securities Act.

Dated:_____________________
                                      __________________________________________
                                      (Signature must conform to name of Holder
                                      as specified on the face of the Option)

                                      Address:__________________________________

                                              __________________________________

                                       10

<PAGE>

                                                                    EXHIBIT 10.2

                                    EXHIBIT B

                         FORM OF TRANSFEROR ENDORSEMENT
                    (To Be Signed Only On Transfer Of Option)

      For value received, the undersigned hereby sells, assigns, and transfers
unto the person(s) named below under the heading "Transferees" the right
represented by the within Option to purchase the percentage and number of shares
of Common Stock of Naturade, Inc. within Option relates specified under the
headings "Percentage Transferred" and "Number Transferred," respectively,
opposite the name(s) of such person(s) and appoints each such person Attorney to
transfer its respective right on the books of Naturade, Inc. ith full power of
substitution in the premises.

<TABLE>
<CAPTION>
                                                   Percentage              Number
Transferees               Address                  Transferred           Transferred
<S>                  <C>                       <C>                    <C>
___________          __________________        _________________      ________________

___________          __________________        _________________      ________________

___________          __________________        _________________      ________________

___________          __________________        _________________      ________________
</TABLE>

Dated________________

                                    (Signature must conform to name of Holder as
                                     specified on the face of the Option)

                                    Address:_________________________________
                                            _________________________________

                                    SIGNED IN THE PRESENCE OF:

                                    _________________________________________
                                                     (Name)

ACCEPTED AND AGREED:
[TRANSFEREE]
____________________
        (Name)