Document:

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 AGREEMENT	1

     

    

 

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 AGREEMENT	2

     

    

 

(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 AGREEMENT	3

     

    

 

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 AGREEMENT	4

     

    

 

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 AGREEMENT	5lgl-ex101_6.htm

Exhibit 10.1

March 27, 2020

 

 

Mr. Ivan Arteaga

LGL Group, Inc

2525 Shader Rd

Orlando, FL  32804

 

RE:  Interim President & CEO Role

 

Dear Ivan:

 

We are pleased to offer you the position as Interim President and Chief Executive Officer for The LGL Group, Inc. (the “Company”).  The following sets forth the terms of the offer and as mutually agreed, your start date was January 1, 2020.  

 

	
1)
	
Compensation:

 

	
 
	
a.
	
Annual Salary.  Your annual base salary will be $48,000, less applicable withholdings and deductions, to be paid in accordance with the Company’s normal payroll procedures.  

 

	
 
	
b.
	
Annual Bonus. Beginning in 2020, you will be eligible to receive a discretionary bonus at the discretion of the company Board of Directors, less applicable withholdings, to be paid in accordance with the Company's normal payroll procedures.   

 

	
 
	
c.
	
Incentive Award.  You will receive a restricted stock award of 45,000 shares as of the date of this agreement in accordance with LGL’s Amended and Restated 2011 Incentive Plan with a tiered vesting schedule, as follows: 15,000 shares on 1/1/22, 15,000 on 1/1/23, and 15,000 shares on 1/1/24.  The requisite service period for this grant is to be three years beginning 1/1/2020. Should your employment be terminated by the Company for any reason other than for cause, your share award shall be prorated by your length of service as President and CEO, with exception that you will be entitled to a minimum of 10,000 shares, with the prorated shares being earned as of the date of your termination, with the remaining shares being forfeited. If your employment is terminated either voluntarily or for cause, any unvested shares at the date of termination shall be forfeited. Furthermore, your vesting is predicated on your continued 

 

2525 Shader Road, Orlando, Florida, 32804

(407) 298-2000

 

	
 
		
employment with the Company as President and CEO. If you cease to be President and CEO but remain on the board of directors, your prorated portion of the unvested shares earned shall remain unvested until the respective vesting date indicated within the grant. This is intended to meet the requirements and qualify as deferred compensation under IRS rules and regulations, until the dates the shares are released from restriction.

 

 

	
2)
	
Benefits:

	
 
	
a.
	
Paid Time Off.  Beginning on your hire date you will accrue up to 15 days per year for personal time off.  You will be eligible to take accrued time off after three (3) months of employment. 

 

	
 
	
b.
	
Other Benefits.  You will be eligible to participate in the Company’s health and other employee benefit programs that are provided by the Company for its executive employees in accordance with the provisions of any such plans, as the same that may be in effect from time to time.

 

	
 
	
c.
	
Severance Benefits - The Company will provide severance benefits equal to twelve (12) weeks of your weekly base salary if, during the first twelve (12) months of employment you are terminated for any reason other than gross misconduct, fraud, or other termination for cause.

 

This overview of benefits represents the Company's current benefit offerings.  These benefits are subject to change at any time with or without notice depending on market and Company conditions. In addition, eligibility and/or election of benefits may be subject to waiting periods.

 

	
3)
	
Expenses:

 

	
 
	
a.
	
Cell Phone.  The Company will provide a cell phone to you at no cost for business use, or you may choose to receive a cell phone stipend of $50 per bi-weekly pay period.  

 

	
 
	
b.
	
Travel Expense.  Your business travel expenses will be reimbursed according to the Company’s normal travel expense reimbursement policies.

 

	
4)
	
Reporting Responsibility.  You will report to the Board of Directors of the Company.

 

	
5)
	
“At-Will” Employment.  You acknowledge that you are an employee at-will and may be terminated at any time for any legally permissible reason.  

 

Page 2

 

 

This offer letter comprises the entire description of your compensation, and fully supersedes any and all prior discussions, documents, promises, agreements, letters, and memoranda regarding this subject matter.  This offer of employment does not constitute a written, verbal or implied contract of employment nor does it guarantee continued employment for a specific amount of time.

 

Please note that this offer of employment is subject to your satisfactory completion of a background check and confirmation of your eligibility to work in the United States under the terms of the Immigration Reform and Control Act of 1986.

 

We look forward to continuing our working relationship.  Please contact me with any questions or comments you may have.

 

 

Sincerely,

 

The LGL Group, Inc.

 

 

__/s/ James W. Tivy______________

James W. Tivy

Chief Financial Officer

 

 

 

 

AGREED AND ACCEPTED:

 

 

___/s/ Ivan Arteaga_______________

Ivan Arteaga

 

 

Page 3

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