Document:

Exhibit
10.2

 

USANA HEALTH SCIENCES, INC.

 

INDEPENDENT DIRECTOR STOCK OPTION AGREEMENT

 

Optionee:

Grant Date:

Number of Covered Shares:

Exercise Price Per Share:

Expiration Date:  Fifth
Anniversary of the Grant Date

 

This Stock Option Agreement (“Agreement”) is entered into as of the     day
of                     ,
between USANA HEALTH SCIENCES, INC., a Utah corporation (the “Company”), and                     
(“Optionee”).

 

WHEREAS, the Company has adopted the 2006 USANA Equity Incentive Award
Plan (the “Plan”) and has approved the granting to certain directors who are
not employees of the Company (“Independent Director,” as defined in the Plan) of
stock options to purchase common stock of the Company, par value $.001 per
share (“Common Stock”); and

 

WHEREAS, Optionee is engaged by the Company as a director who is not an
employee of the Company and the Company desires to secure or increase Optionee’s
stock ownership of the Company in order to increase Optionee’s incentive and
personal interest in the welfare of the Company.

 

NOW, THEREFORE, in consideration of the premises, covenants and
agreements hereinafter set forth, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto have agreed and do hereby agree as follows:

 

1.             Grant of Options.  On the terms and conditions set forth in this
Agreement, the Company hereby grants to Optionee nonqualified stock options (the
“Options”) to purchase all or any part of an aggregate amount of                    
(          ) shares of the
Common Stock of the Company at a purchase price of $         
per share.

 

2.             Term of Options; Vesting. 
Except as otherwise provided in Sections 4 and 10 below, the term of the
Options commences on the Grant Date and ends on the Expiration Date, provided
that Optionee remains an Independent Director of the Company.  In no event may the Options be exercised
later than the Expiration Date.  The
Options shall become vested and exercisable in four equal quarterly installments
of twenty five percent (25%) of the Options, so as to be 100% vested and
exercisable on the first anniversary of the Grant Date, subject to Optionee’s
continued service as an Independent Director of the Company on each vesting
date.  If Optionee’s service as an
Independent Director of the Company terminates, the Options may be exercised
only as described in paragraph 4 below.

 

3.             Exercise of Options.  The Options or any portion thereof may be
exercised by Optionee paying the purchase price of any shares with respect to
which the Options are being exercised by cash, certified check or cashier’s
check (but no personal checks unless otherwise approved by the Committee).  Except as otherwise provided by the Committee
before the Option is exercised, (i) all or a portion of the Exercise Price may
be paid by Optionee by delivery of shares of Common Stock already owned by
Optionee for at least six (6) months and acceptable to the Committee having an
aggregate Fair Market Value (as of the date of exercise) that is equal to the
amount of cash that would otherwise be 

 

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required;
(ii) Optionee may pay the Exercise Price by authorizing a third party to sell
shares of Stock (or a sufficient portion of the shares) acquired upon exercise
of the Option and remit to the Company a sufficient portion of the sale
proceeds to pay the entire Exercise Price and any tax withholding resulting
from such exercise; or (iii) Optionee may pay the Exercise Price by a reduction
in the amount of any Company liability to the Optionee.  In each case Optionee’s payment shall be
delivered with a written notice of exercise which shall:

 

a.             State the number of
shares being exercised, the name, address and social security number of each
person for whom the stock certificate or certificates for such shares of the
Common Stock are to be registered;

 

b.             Contain any
representations and agreements as to Optionee’s investment intent with respect
to the shares exercised as may be satisfactory to the Company’s counsel; and

 

c.             Be signed by the
person or persons entitled to exercise the Options and, if the Options are
being exercised by any person or persons other than Optionee, be accompanied by
proof satisfactory to counsel for the Company of the right of such person or
persons to exercise the Options.

 

In addition, unless the shares to be acquired by Optionee have been
registered under the Securities Act of 1933, as amended, upon and effective as
of the date of exercise of the Option under this Agreement, Optionee agrees,
represents and warrants that Optionee (i) is acquiring the shares of Common
Stock for investment with no present intention of distributing or selling such
shares or any interest therein except as permitted under this Agreement; (ii)
is a director of the Company experienced in making risky investments and has
the capacity to protect his interests in connection with making his decision to
exercise the Option; (iii) is well-informed or capable of asking questions of
the Company’s officials to make himself well-informed concerning the nature of
his investment decision to exercise the Option and of the true financial status
of the Company; and (iv) has obtained, analyzed and retained (or elected not to
retain) copies of the Company’s current financial statements.  Further, as a condition to the exercise of
the Options, the Company may require the person exercising the Options to make
any representation and warranty to the Company that may be required by any applicable
law or regulation.

 

                                4.             Termination of Directorship or
Death. In the event Optionee ceases to be an Independent Director for any
reason, all then unvested Options awarded hereunder shall immediately terminate
without notice to Optionee and shall be forfeited.  Vested Options will be exercisable according
to the following provisions:

 

a.             If
Optionee ceases to be an Independent Director for any reason other than
retirement or Disability (which are governed by paragraph b. below), removal
for Cause (which is governed by paragraph c. below) or death (which is governed
by paragraph d. below), all Options awarded hereunder that are vested at such
time shall be exercisable at any time prior to the Expiration Date.

b.             If
Optionee ceases to be an Independent Director on account of his retirement or
Disability, all Options awarded hereunder that are vested at such time shall be
exercisable at any time prior to the Expiration Date.

 

c.             If
Optionee is removed as an Independent Director prior to expiration of his term
for Cause (as defined below), all outstanding Options awarded hereunder which
are not exercisable immediately prior to removal, and all outstanding Options
awarded hereunder which are exercisable immediately prior to removal, shall
terminate as of the date of removal for Cause and may not be exercised.  For purposes of this Award Agreement, “Cause”
shall mean (i) any act of personal dishonesty in connection with Optionee’s
responsibilities to the Company and intended to result in 

 

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substantial personal enrichment to Optionee,
(ii) Optionee’s conviction of a felony or (iii) Optionee’s willful act which
constitutes gross misconduct and which is injurious to the Company.

 

d.             If Optionee’s
service as an Independent Director of the Company terminates by reason of Optionee’s
death, or if Optionee dies within the ninety day period after the date Optionee
ceases to be an Independent Director of the Company for any reason other than
Cause, any of Optionee’s vested Options hereunder may be exercised by Optionee’s
estate, personal representative or beneficiary who has acquired the Options by
will or by the laws of descent and distribution, at any time prior to the Expiration Date.

 

                                5.             Transfer of Options.  Unless the Company, upon advice of its securities
counsel, directs otherwise, the Options may not be assigned or transferred in
any manner except upon the death of Optionee by will or by the laws of descent
and distribution.  During the lifetime of
Optionee, the Options shall be exercisable only by Optionee.

 

                                6.             Reservation of Shares.  The Company, during the term hereof, will at
all times reserve and keep available, and will seek or obtain from any
regulatory body having jurisdiction any requisite authority in order to issue
and sell such number of shares of its Common Stock as shall be sufficient to
satisfy the requirements hereof.  The
inability of the Company to obtain from any regulatory body having jurisdiction
the authority deemed by the Company’s counsel to be necessary to the lawful
issuance and sale of any shares of stock hereunder shall relieve the Company of
any liability in respect of the nonissuance or sale of such stock as to which
such requisite authority shall not have been obtained.

 

                                7.             Application of Section 16(b).  The parties acknowledge that, if the Company
has a class of securities required to be registered pursuant to the Securities
Exchange Act of 1934 (the “Exchange Act”), and if Optionee is an officer,
director or ten percent (10%) shareholder of the Company, the grant to Optionee
of Options hereunder, or the Optionee’s sale of shares underlying the Options,
may, unless the Plan is qualified under Rule 16b-3 of the SEC, subject Optionee
to liability under the insider trading prohibitions of Section 16(b) of the Exchange
Act, if Optionee purchases or sells Common Stock of the Company within six
months before or after the grant of the Options, or within six months before or
after the sale of the shares underlying the Options.  This acknowledgment is for informational
purposes only and is not to be construed as increasing, limiting or describing
the rights and obligations of the parties hereunder.

 

                                8.             Restriction on Option Exercise.  Notwithstanding any contrary provision
hereof, the Options may not be exercised by Optionee unless the shares to be
acquired by Optionee have been registered under the Securities Act of 1933 (the
“Act”), and any other applicable securities laws of any other state, or the
Company receives an opinion of counsel (which may be counsel for the Company) reasonably
acceptable to the Company stating that the exercise of the Options and the
issuance of shares pursuant to the exercise is registered or exempt from such
registration requirements.  Optionee
shall represent that unless and until the shares have been registered under the
Act and applicable state securities laws: 
(1) Optionee is acquiring the shares for investment purposes only
and without the intent of making any sale or disposition thereof; (2) Optionee
has been advised and understands that the shares have not been registered for
sale pursuant to federal and state securities laws and are “restricted
securities” under such laws; and (3) Optionee acknowledges that the shares
will be subject to stop transfer instructions and bear the following legend:

 

THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY OTHER STATE
SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD OR TRANSFERRED IN THE 

 

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ABSENCE OF REGISTRATION OR THE AVAILABILITY OF AN EXEMPTION FROM SUCH
REGISTRATION.  NO OFFER, SALE OR TRANSFER
MAY TAKE PLACE WITHOUT PRIOR WRITTEN APPROVAL OF THE COMPANY BEING AFFIXED
HERETO.  IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT, SUCH APPROVAL SHALL BE GRANTED ONLY IF THE COMPANY HAS
RECEIVED AN OPINION OF SHAREHOLDER’S COUNSEL AT SHAREHOLDER’S EXPENSE
SATISFACTORY TO THE COMPANY TO THE EFFECT THAT THIS CERTIFICATE MAY BE LAWFULLY
TRANSFERRED PURSUANT TO AN EXEMPTION FROM REGISTRATION.

 

                                9.             Withholding of Taxes.  The Options may not be exercised unless
Optionee has paid or has made provision satisfactory to the Company for payment
of, federal, state and local income taxes, or any other taxes (other than stock
transfer taxes) which the Company may be obligated to collect as a result of
the issue or transfer of Common Stock upon such exercise of the Options.  In its sole discretion, and at the request of
Optionee, the Company may permit Optionee (other than an Optionee who would be
subject to Section 16(b) of the Exchange Act) to satisfy the obligation imposed
by this Section, in whole or in part, by instructing the Company to withhold up
to that number of shares otherwise issuable to Optionee with a fair market
value equal to the amount of tax to be withheld.

 

                                10.           Mergers, Reorganizations, and
Certain Other Changes.  In the event
of the Company’s liquidation, reorganization, separation, merger or
consolidation into, or acquisition of property or stock by another corporation,
or sale of substantially all assets to another corporation, the rights of
Optionee with respect to the Options granted hereunder shall be governed by the
Committee, as provided in the Plan.

 

                                11.           Antidilution.  The aggregate number of shares of Common
Stock available for issuance under the Options, and the price per share, shall
all be proportionately adjusted for any increase or decrease in the number of
issued shares of Common Stock subsequent to the date of this Agreement
resulting from a recapitalization, reorganization, merger, consolidation or
similar transaction as provided in the Plan.

 

                                12.           No Rights as a Stockholder.  Optionee or a permitted transferee of the
Options shall have no rights as a stockholder with respect to any shares
covered by the Options until the date as of which stock is issued following
exercise of such Options.  Except as
provided in this Agreement, no adjustment shall be made for dividends (ordinary
or extraordinary, whether in cash, securities or other property) or any other
distributions for which the record date is prior to the date as of which such
stock is issued.

 

                                13.           No Employment Rights.  This Agreement is not an employment agreement
or contract and does not grant any employment rights to Optionee.

 

                                14.           Other Provisions.  The Company may, as a condition precedent to
the exercise of the Options, require Optionee (including, in the event of
Optionee’s death, his legal representatives, legatees or distributees) to enter
into such agreements or to make such representations as may be required to make
lawful the exercise of the Options and the ultimate disposition of the shares
acquired by such exercise.

 

                                15.           Notices.  Any notice which either of the parties hereto
is required or permitted to give to the other must be in writing and may be
given by personal delivery, electronic or facsimile 

 

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transmission,  or by mailing the same by registered or
certified mail, return receipt requested, to the party to which or to whom the
notice is directed, at the address each party designates in writing.  Any notice mailed to such address shall be
effective when deposited in the mail, duly addressed and postage prepaid,
notwithstanding failure by the addressee thereof to receive the mailed notice.

 

                                16.           Governing Law.  All transactions contemplated hereunder and
all rights of the parties hereto shall be governed as to validity,
construction, enforcement and in all other respects by the laws and decisions
of the State of Utah.

 

                                17.           Titles.  The titles of the sections of this Agreement
are inserted only as a matter of convenience and for reference, and in no way
define, limit or describe the scope of this Agreement or the intent of any
provisions hereof.

 

                                18.           Amendment.  This Agreement shall not be modified or
amended except by written agreement signed by all of the parties hereto.

 

                                19.           Attorney’s Fees and Costs of
Enforcement.  If any party to this
Agreement shall incur any costs resulting from enforcement of this Agreement,
the defaulting party shall be liable to the prevailing party for such
costs.  Costs, as used herein, shall
include costs of enforcement, interpretation, or collection, including without
limitation, reasonable attorney’s fees, court costs, collection charges, travel
and other related or similar expenses.

 

                                20.           Severability of Provisions.  Any provision of this Agreement that is
invalid, prohibited, or unenforceable in any jurisdiction, shall not invalidate
the remainder of the provision or the remaining provisions of the Agreement.

 

                                21.           Entire Agreement.  Subject to the Plan, a copy of which in its
present form is available from the Secretary of the Company, this Agreement
contains all of the representations, declarations and statements from either
party to the other and expresses the entire understanding between the parties
with respect to the transactions provided for herein. All prior memoranda,
letters, statements and agreements concerning this subject matter, if any, are
merged in and replaced by this Agreement.

 

                                22.           Pronouns, Number and Gender.  Wherever necessary to implement the intent of
the parties hereto, references herein to the singular shall be interpreted as
the plural, and vice versa, and the feminine, masculine or neuter gender shall
be treated as one of the other genders.

 

                                23.           Binding Effect.  This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective legal
representatives, successors and assigns.

 

                                24.           Defined Terms.  The capitalized terms contained in this
Agreement but not otherwise defined herein shall have the same meanings given
to them in the Plan.

 

                                25.           Counterparts.  This Agreement may be executed in one or more
counterparts, each of which may be deemed an original, but all of which
together shall constitute one and the same instrument. 

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed the day and year first above written.

 

	
   

  	
  COMPANY:

  	
  USANA HEALTH SCIENCES, INC.,

  
	
   

  	
   

  	
  a Utah corporation

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  OPTIONEE:

  	
   

  
	
   

  	
   

  	
  (Signature)

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Printed Name)

  
	
   

  	
   

  	
   

  	
   

  

 

 

6Exhibit 10.3

 

USANA HEALTH SCIENCES, INC.

 

EMPLOYEE INCENTIVE STOCK OPTION AGREEMENT

 

Optionee:

Date of Grant:

Number of Covered Shares:

Exercise Price Per Share:

Expiration Date:

 

This Incentive Stock Option Agreement (“Agreement”) is entered into as
of the       day of                             ,
between USANA HEALTH SCIENCES, INC., a Utah corporation (the “Company”), and                               
(“Optionee”).

 

WHEREAS, the Company has adopted the 2006 USANA Health Sciences, Inc. Equity
Incentive Award Plan (the “Plan”) and has approved the granting to certain
employees of the Company of incentive stock options to purchase common stock of
the Company, par value $.001 per share (“Common Stock”); and

 

WHEREAS, Optionee is employed by the Company in a key executive
capacity, or is engaged by the Company as an officer and/or employee, and the
Company desires that Optionee remain in such employ and desires to secure or
increase Optionee’s stock ownership of the Company in order to increase
Optionee’s incentive and personal interest in the welfare of the Company.

 

NOW, THEREFORE, in consideration of the premises, covenants and
agreements hereinafter set forth, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto have agreed and do hereby agree as follows:

 

1.                                       Grant of
Options. On the terms and conditions set forth in this Agreement,
including but not limited to the substitution provisions of Section 26 below,
the Company hereby grants to Optionee incentive stock options as that term is
used in Section 422 of the Code (the “ISOs”) to purchase all or any part of an
aggregate amount of                             
(           ) shares of
the Common Stock of the Company at a purchase price of $           
per share. However, to the extent that the Fair Market Value of Common Stock
with respect to which ISOs are exercisable for the first time during any
calendar year (under the Plan and all other stock option plans of the Company)
exceeds $100,000, such portion in excess of $100,000 shall be treated as a
nonqualified stock option (“NSO”). The ISOs and the NSOs are collectively
referred to herein as the “Options”.

 

2.                                       Term of
Options; Vesting Schedule. Except as otherwise provided in
Sections 4 and 10 below, the Options shall vest and become exercisable pursuant
to the following vesting schedule, and shall remain exercisable until            
(     ) years and               
(     ) days after the date of this Agreement (     /    /         ,
the “effective term”), at which time the Options shall terminate and not be
exercisable thereafter:

 

a.                                       Options to
purchase                         
(             )
of the total number of shares subject to Options granted shall vest and become
exercisable     /    /         ,
provided Optionee satisfactorily completes                
(       ) months of service (as determined
by the Company’s Board of Directors).

 

b.                                      Options to
purchase                            
(           ) of the
total number of shares subject to Options granted shall vest and become
exercisable      /     /        ,
   /    /        ,

 

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    /    /         ,
and     /     /        ,
provided Optionee satisfactorily completes an additional                     
(     ) months of service each year.

 

3.                                       Exercise of
Options. The Options or any portion thereof may be exercised by
Optionee paying the purchase price of any shares with respect to which the
Options are being exercised by cash, certified check or cashier’s check (but no
personal checks unless otherwise approved by the Committee). Except as
otherwise provided by the Committee before the Option is exercised, (i) all or
a portion of the Exercise Price may be paid by Optionee by delivery of shares
of Common Stock already owned by Optionee for at least six (6) months and
acceptable to the Committee having an aggregate Fair Market Value (as of the
date of exercise) that is equal to the amount of cash that would otherwise be
required; (ii) Optionee may pay the Exercise Price by authorizing a third party
to sell shares of Stock (or a sufficient portion of the shares) acquired upon
exercise of the Option and remit to the Company a sufficient portion of the
sale proceeds to pay the entire Exercise Price and any tax withholding
resulting from such exercise; or (iii) Optionee may pay the Exercise Price by a
reduction in the amount of any Company liability to the Optionee. In each case
Optionee’s payment shall be delivered with a written notice of exercise which
shall:

 

a.                                       State
the number of shares being exercised, the name, address and social security
number of each person for whom the stock certificate or certificates for such
shares of the Common Stock are to be registered;

 

b.                                      Contain
any representations and agreements as to Optionee’s investment intent with
respect to the shares exercised as may be satisfactory to the Company’s
counsel; and

 

c.                                       Be
signed by the person or persons entitled to exercise the Options and, if the
Options are being exercised by any person or persons other than Optionee, be
accompanied by proof satisfactory to counsel for the Company of the right of
such person or persons to exercise the Options.

 

In addition, unless the shares to be acquired by Optionee have been
registered under the Securities Act of 1933, as amended, upon and effective as
of the date of exercise of the Option under this Agreement, Optionee agrees,
represents and warrants that Optionee (i) is acquiring the shares of Common
Stock for investment with no present intention of distributing or selling such
shares or any interest therein except as permitted under this Agreement; (ii)
is not only an employee but also a director or executive officer of the Company
experienced in making risky investments and has the capacity to protect his
interests in connection with making his decision to exercise the Option; (iii)
is well-informed or capable of asking questions of the Company’s officials to
make himself well-informed concerning the nature of his investment decision to
exercise the Option and of the true financial status of the Company; and (iv)
has obtained, analyzed and retained (or elected not to retain) copies of the
Company’s current financial statements. Further, as a condition to the exercise
of the Options, the Company may require the person exercising the Options to
make any representation and warranty to the Company that may be required by any
applicable law or regulation.

 

4.                                       Termination
of Employment or Death.

 

a.                                       In
the event Optionee’s employment shall be involuntarily terminated by the
Company without cause, the Options shall only be exercisable for those portions
of the Options which have completely vested as of the date of Involuntary
Termination of Employment, provided such exercise occurs both within the
remaining effective term of the Options and ninety (90) days after the date of
termination by the Company.

 

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b.                                      In
the event Optionee dies while employed by the Company or dies within ninety
(90) days after termination of employment with the Company, whether by reason
of Retirement or Disability, involuntary termination without cause, or
voluntary termination (but not termination For Cause), the Options granted
hereunder to Optionee shall be exercisable within three (3) years after the
date of Optionee’s death,  but the
Options may not be exercised for more than the number of Shares, if any, as to
which the Options were exercisable by Optionee immediately prior to the date of
his death or, if sooner, the date of termination of employment. The legal
representative, if any, of Optionee’s estate, or otherwise the appropriate
legatees or distributees of Optionee’s estate, may exercise the Option on
behalf of Optionee.

 

c.                                       In
the event Optionee’s employment shall terminate on account of Retirement or
Disability, the Options held by Optionee, to the extent exercisable through the
date of such retirement or disability, may be exercised by Optionee, provided
such exercise occurs within both the remaining effective term of the Options
and three (3) years from the date of termination of employment.

 

d.                                      In
the event of Optionee’s Voluntary Termination of Employment, Optionee may
exercise the Options provided such exercise occurs within both the remaining
effective term of the Options and ninety (90) days from the date of
termination, but the Options may not be exercised for more than the number of
shares, if any, as to which the Options were exercisable by Optionee
immediately prior to such termination of employment.

 

e.                                       In
the event Optionee shall have an Involuntary Termination of Employment “For
Cause” (as defined in Section 12(d)(ii) of the Plan), no exercise period shall
exist and Optionee shall forfeit the Options as of the date of termination.

 

f.                                         To
the extent not then exercisable in accordance with this Section, the Options
shall terminate on the date Optionee’s employment terminates with the Company.

 

g.                                      For
purposes of this Agreement, termination of employment shall be considered to
occur when an employee is no longer an employee of the Company or any
Subsidiary. Whether an authorized leave of absence or absence on military or
government service shall constitute termination of employment for purposes of
this Agreement shall be determined by the Committee. Retirement shall be
considered to mean retirement as defined in the Plan.

 

5.                                       Transfer of
Options. Unless the Company, upon advice of its securities counsel,
directs otherwise, the Options may not be assigned or transferred in any manner
except upon the death of Optionee by will or by the laws of descent and
distribution. During the lifetime of Optionee, the Options shall be exercisable
only by Optionee.

 

6.                                       Reservation
of Shares. The Company, during the term hereof, will at all times
reserve and keep available, and will seek or obtain from any regulatory body
having jurisdiction any requisite authority in order to issue and sell such
number of shares of its Common Stock as shall be sufficient to satisfy the
requirements hereof. The inability of the Company to obtain from any regulatory
body having jurisdiction the authority deemed by the Company’s counsel to be
necessary to the lawful issuance and sale of any shares of stock hereunder
shall relieve the Company of any liability in respect of the nonissuance or
sale of such stock as to which such requisite authority shall not have been
obtained.

 

7.                                       Application
of Section 16(b). The parties acknowledge that, if the
Company has a class of securities required to be registered pursuant to the
Securities Exchange Act of 1934, and if Optionee is an officer, director or ten
percent (10%) shareholder of the Company, the grant to Optionee of Options
hereunder, or the Optionee’s sale of shares underlying the Options, may, unless
the Plan is

 

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qualified
under Rule 16b-3 of the SEC, subject Optionee to liability under the insider
trading prohibitions of Section 16(b) of the Securities Exchange Act of 1934,
if Optionee purchases or sells Common Stock of the Company within six months
before or after the grant of the Options, or within six months before or after
the sale of the shares underlying the Options. This acknowledgment is for
informational purposes only and is not to be construed as increasing, limiting
or describing the rights and obligations of the parties hereunder.

 

8.                                       Restriction
on Option Exercise. Notwithstanding any contrary provision
hereof, the Options may not be exercised by Optionee unless the shares to be
acquired by Optionee have been registered under the Securities Act of 1933 (the
“Act”), and any other applicable securities laws of any other state, or the
Company receives an opinion of counsel (which may be counsel for the Company)
reasonably acceptable to the Company stating that the exercise of the Options
and the issuance of shares pursuant to the exercise is registered or exempt
from such registration requirements. Optionee shall represent that unless and
until the shares have been registered under the Act and applicable state
securities laws:  (1) Optionee is
acquiring the shares for investment purposes only and without the intent of
making any sale or disposition thereof; (2) Optionee has been advised and
understands that the shares have not been registered for sale pursuant to
federal and state securities laws and are “restricted securities” under such
laws; and (3) Optionee acknowledges that the shares will be subject to
stop transfer instructions and bear the following legend:

 

THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY OTHER STATE
SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD OR TRANSFERRED IN THE ABSENCE OF
REGISTRATION OR THE AVAILABILITY OF AN EXEMPTION FROM SUCH REGISTRATION. NO
OFFER, SALE OR TRANSFER MAY TAKE PLACE WITHOUT PRIOR WRITTEN APPROVAL OF THE
COMPANY BEING AFFIXED HERETO. IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT, SUCH APPROVAL SHALL BE GRANTED ONLY IF THE COMPANY HAS RECEIVED AN
OPINION OF SHAREHOLDER’S COUNSEL AT SHAREHOLDER’S EXPENSE SATISFACTORY TO THE
COMPANY TO THE EFFECT THAT THIS CERTIFICATE MAY BE LAWFULLY TRANSFERRED
PURSUANT TO AN EXEMPTION FROM REGISTRATION.

 

9.                                       Withholding
of Taxes. The Options may not be exercised unless Optionee has paid
or has made provision satisfactory to the Company for payment of, federal,
state and local income taxes, or any other taxes (other than stock transfer
taxes) which the Company may be obligated to collect as a result of the issue
or transfer of Common Stock upon such exercise of the Options. In its sole
discretion, and at the request of Optionee, the Company may permit Optionee
(other than an Optionee who would be subject to Section 16(b) of the Exchange
Act) to satisfy the obligation imposed by this Section, in whole or in part, by
instructing the Company to withhold up to that number of shares otherwise
issuable to Optionee with a fair market value equal to the amount of tax to be
withheld.

 

10.                                 Mergers,
Reorganizations, and Certain Other Changes. In the
event of the Company’s liquidation, reorganization, separation, merger or
consolidation into, or acquisition of property or stock by another corporation,
or sale of substantially all assets to another corporation, the rights of
Optionee with respect to the Options granted hereunder shall be governed by the
Committee, as provided in the Plan.

 

4

 

11.                                 Antidilution. The
aggregate number of shares of Common Stock available for issuance under the
Options, and the price per share, shall all be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock subsequent
to the date of this Agreement resulting from a recapitalization,
reorganization, merger, consolidation or similar transaction as provided in the
Plan.

 

12.                                 No Rights as
a Stockholder. Optionee or a permitted transferee of
the Options shall have no rights as a stockholder with respect to any shares
covered by the Options until the date as of which stock is issued following
exercise of such Options. Except as provided in this Agreement, no adjustment
shall be made for dividends (ordinary or extraordinary, whether in cash,
securities or other property) or any other distributions for which the record
date is prior to the date as of which such stock is issued.

 

13.                                 No Employment
Rights. This Agreement is not an employment agreement or contract
and does not grant any employment rights to Optionee.

 

14.                                 Other
Provisions. The Company may, as a condition
precedent to the exercise of the Options, require Optionee (including, in the
event of Optionee’s death, his legal representatives, legatees or distributees)
to enter into such agreements or to make such representations as may be
required to make lawful the exercise of the Options and the ultimate
disposition of the shares acquired by such exercise.

 

15.                                 Notices. Any notice
which either of the parties hereto is required or permitted to give to the
other must be in writing and may be given by personal delivery, electronic or
facsimile transmission,  or by mailing
the same by registered or certified mail, return receipt requested, to the
party to which or to whom the notice is directed, at the address each party
designates in writing. Any notice mailed to such address shall be effective
when deposited in the mail, duly addressed and postage prepaid, notwithstanding
failure by the addressee thereof to receive the mailed notice.

 

16.                                 Governing
Law. All transactions contemplated hereunder and all rights of
the parties hereto shall be governed as to validity, construction, enforcement
and in all other respects by the laws and decisions of the State of Utah.

 

17.                                 Titles. The titles
of the sections of this Agreement are inserted only as a matter of convenience
and for reference, and in no way define, limit or describe the scope of this
Agreement or the intent of any provisions hereof.

 

18.                                 Amendment. This
Agreement shall not be modified or amended except by written agreement signed
by all of the parties hereto.

 

19.                                 Attorney’s
Fees and Costs of Enforcement. If any party to this Agreement shall
incur any costs resulting from enforcement of this Agreement, the defaulting
party shall be liable to the prevailing party for such costs. Costs, as used
herein, shall include costs of enforcement, interpretation, or collection,
including without limitation, reasonable attorney’s fees, court costs,
collection charges, travel and other related or similar expenses.

 

20.                                 Severability
of Provisions. Any provision of this Agreement that is
invalid, prohibited, or unenforceable in any jurisdiction, shall not invalidate
the remainder of the provision or the remaining provisions of the Agreement.

 

5

 

21.                                 Entire
Agreement. Subject to the Plan, a copy of which in its present form
is available from the Secretary of the Company, this Agreement contains all of
the representations, declarations and statements from either party to the other
and expresses the entire understanding between the parties with respect to the
transactions provided for herein. All prior memoranda, letters, statements and
agreements concerning this subject matter, if any, are merged in and replaced
by this Agreement.

 

22.                                 Pronouns,
Number and Gender. Wherever necessary to implement the
intent of the parties hereto, references herein to the singular shall be
interpreted as the plural, and vice versa, and the feminine, masculine or
neuter gender shall be treated as one of the other genders.

 

23.                                 Binding
Effect. This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and their respective legal representatives,
successors and assigns.

 

24.                                 Defined
Terms. The capitalized terms contained in this Agreement but not
otherwise defined herein shall have the same meanings given to them in the
Plan.

 

25.                                 Counterparts. This
Agreement may be executed in one or more counterparts, each of which may be
deemed an original, but all of which together shall constitute one and the same
instrument.

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed the day and year first above written.

 

	
  COMPANY:

  	
  USANA HEALTH SCIENCES, INC.,

  
	
   

  	
  a Utah corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  OPTIONEE:

  	
   

  	
   

  
	
   

  	
  (Signature)

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Printed Name)

  

 

6

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