Exhibit 99.2
Executive Agreement
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Agreement as of September 13, 2004 between CLEAN DIESEL TECHNOLOGIES, INC.
("the Company"), a Delaware corporation of Suite 702, 300 Atlantic Street,
Stamford Connecticut, 06901 USA, and BERNHARD STEINER (the "Executive"), an
individual of Am Rosenwald 14, D-65779 Kelkheim-Ruppertshain,, Germany.
1. Employment Capacity. The Executive is engaged by the Company to act in the
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capacity of Chief Executive Officer of the Company and its subsidiaries. The
Executive shall report to the Board of Directors of the Company. The executive
shall be directly employed by the Company or an appropriate non-U.S. subsidiary
of the Company.
2. Duties. The Executive shall devote his full time and efforts to such
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employment principally based in London, United Kingdom, with such travel as from
time to time shall be incidental to his duties, and shall at all times
faithfully, industriously and to the best of his, skill, ability, experience and
talent, perform all of the duties that may be required of him pursuant to the
express and implied terms of this Agreement. The Executive may during the term
of this Agreement continue as a non-executive director of Wayfinder Systems Ab.
3. Term. The term of this Agreement shall commence on the date first written
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above and shall terminate, except as otherwise expressly provided herein, on
September 13, 2006
4. Compensation. The Company shall compensate the Executive for services to
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be rendered, as follows:
a. Basic Salary. The Company shall pay to the Executive a Basic Salary
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at the rate of Euros Two Hundred Thousand (Euro 200,000) per annum, payable not
less often than monthly, or in such other periodic installments as is mutually
agreed.
b. Annual Bonus. After the first twelve (12) months of the Executive's
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service, the Executive shall be paid a guaranteed bonus of Euros One Hundred
Thousand (Euro 100,000), provided he shall then still be Chief Executive of the
Company. Thereafter, the Executive shall participate in such annual bonus
program as the Board of Directors shall agree.
c. Benefits. The Company shall annually contribute, or pay to or for the
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benefit of
the Executive up to the amount of Euros Fifty Thousand (Euro 50,000) for
pension, life insurance and health benefits with such specific allocation as may
be agreed from time to time.
d. Expenses. The Executive shall be reimbursed for all ordinary and
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necessary expenses incidental to his services to the Company as he
shall from time to time claim accompanied by proper documentation.
This shall include the costs of his home office including telephone,
mobile phone and computer and peripherals.
e. Car expenses will be reimbursed on a mileage basis. Currently the rate
in UK is Pound 0.40 per mile for 10,000 miles per year and Pound 0.25
per mile thereafter. Alternative charging basis can be agreed with the
compensation committee's approval.
f. Stock. The Company will arrange for the Executive to receive a
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non-qualified stock option under its 1994 Incentive Plan (the "Plan") to
purchase One Hundred Fifty Thousand (150,000) shares of the Company's common
stock, $.05 par value, on the Company's standard terms and conditions and at an
exercise price which shall be the fair market value of the stock on September
13, 2004 as determined pursuant to the terms of the Plan and will vest one third
on issue, one third on first anniversary and one third on second anniversary.
The Executive shall receive an additional non-qualified stock option under the
Plan on the Company's standard terms and conditions for the purchase of One
Hundred Thousand (100,000) shares on the completion or closing date of a sale of
debt and or equity of the Company which, in connection with or supplemented by
other financial arrangements after the commencement of the term of this
Agreement, shall raise a minimum of U.S.Ten Million Dollars (U.S.$10,000,000)
for the Company, provided that such closing or completion date shall be within
eighteen (18) months of the commencement of the term of this agreement. Such
additional option shall have an exercise price at fair market value of the stock
on the closing or completion date as determined pursuant to the terms of the
Plan.
5. Holidays: The Executive shall be entitled to 25 days holiday per annum in
addition to statutory holidays.
6. Discoveries and Inventions. All patentable and unpatentable inventions,
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discoveries and ideas which are made or conceived by Executive during the term
of his employment with the Company and which are based on or arise out of his
employment with the Company ("Developments") are or shall be the Company's
property. Executive agrees at any time whether during his period of employment
or otherwise to disclose promptly to the Company each such
Development and, on the Company's request and at its expense, Executive will
assist the Company, or its designee, in making application for Letters Patent in
any country in the world. Executive further agrees also at any time to execute
all papers and do all things which may be necessary or advisable to prosecute
such applications, and to transfer to and vest in the Company, or its designee,
all the right, title and interest in and to such Developments, and all
applications for patents and Letters Patent issued thereon. If for any reason
Executive is unable to effectuate a full assignment of any such Development,
Executive agrees to transfer to the Company, or its designee, Executive's
transferable rights, whether they be exclusive or non-exclusive, or as a joint
inventor or partial owner of the Development. No action or inaction by the
Company shall in any event be construed as a waiver or abandonment or ifs rights
to any such Development which may only be effected by an instrument in writing
assigned by the authorized official of the Company by which it specifically
states it intends to be bound in such respect.
7. Proprietary Information. Executive will not at any time, either during the
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term of this Agreement or thereafter, disclose to others, or use for his own
benefit or the benefit of others, any of the Developments or any confidential,
proprietary or secret information owned, possessed or used by the Company or any
of its subsidiaries (collectively "Proprietary Information"), which by way of
illustration, but not limitation, includes devices, processes, structures,
machines, data, know-how, business opportunities, marketing plans, forecasts,
unpublished financial statements, budgets, licenses and information concerning
prices, costs, employees, customers and suppliers. Executive's undertakings in
this respect shall not apply to Proprietary Information which (a) is or becomes
generally known to the public through no action on the part of Executive or (b)
is generally disclosed to third parties by the Company or any of its
subsidiaries without restriction on such third parties. Upon termination of this
Agreement or at any time on request, Executive shall return to the Company all
media in which any Proprietary Information shall be contained which Executive
agrees is the property of the Company or a subsidiary of the Company.
8. Non-Competition. Following the termination of the Executive's employment
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with the Company or any of its subsidiaries and for 2 years thereafter, the
Executive shall not, individually or on behalf of or in conjunction with any
other person or entity, recruit, entice, induce or encourage any of the
Company's other employees or consultants to engage in any activity which, were
it done by Executive, would violate any provision of this Agreement; accept
employment or provide consulting services or engage in business activities where
such
employment, services or activities reasonably will involve the use of the
Company's Proprietary Information for the benefit of others or for the Executive
or will result in the divulging of Proprietary Information. During such two-year
period, and before performing services for others as employee or consultant or
before engaging in business activities, in the actual lines of business in which
the Company was engaged during the Executive's period of service, the Executive
will inform the Company of the general nature of the services or activities to
be performed and the party for whom they will be performed and the Executive
prior to performing such services will inform the other party of the existence
of this covenant in this Agreement. Executive agrees that breach of his
covenants hereunder regarding the Company's Proprietary Information is likely to
cause serious economic injury to the Company.
9. Equitable Relief. The parties agree that in the event the Executive
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breaches, or threatens to breach, any of the covenants expressed in Sections 6,7
or 8 hereunder, the damages would be great, incapable of calculation and
inadequate to make the Company whole, and, therefore, in addition to any other
remedies which may be available to the Company including damages, the Company
may apply to a court of competent jurisdiction for equitable relief in the form
of injunctions or restraining orders or the like, and the Executive waives any
requirement that the Company post bond in connection with such proceeding or in
any appeal therefrom.
10. Termination.
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a. Termination for Reasonable Cause by the Company. Just Cause. The
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Company has the right to terminate this Agreement for Just Cause at
any time; in which event, all unaccrued rights and benefits of the
Executive hereunder shall terminate and be of no further force and
effect. "Just Cause" shall mean conviction of the Executive under, or
a plea of guilty by the Executive to, any charge which would be a
felony under the laws of the Company's home office; any instance of
willful fraud, embezzlement, self-dealing or insider trading,
regardless of amount, with respect to the Company; any substance abuse
which, in the sole opinion of the Board of Directors, limits
Executive's performance of his duties under this Agreement; willful
refusal or failure of the Executive to obey the lawful directions of
the Board of Directors of the Company (or of any successor to the
interest of the Company); or gross, willful misfeasance or gross
nonfeasance of the duties and responsibilities assigned to the
Executive pursuant to this Agreement, the nature of which shall be set
forth in the
notice of termination for reasonable cause.
b. Incapacity. In the event the Executive suffers illness or incapacity
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of such character as to substantially disable him from performing his
duties for more than 90 consecutive days or for more than 120 days in
any one agreement year, the Company may terminate this Agreement by
giving notice. In such event, the Executive will receive his Basic
Salary for six months after termination for incapacity.
c. At Will. Either party may terminate this Agreement at will and
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without cause. If the Agreement is terminated by the Company without
cause, the Executive shall receive his Basic Salary, reduced by any
salary the executive earns from other employment, for the remaining
term of this Agreement or until the Executive accepts a comparable
position with equivalent compensation, whichever occurs earlier. If
this Agreement is terminated by the Executive, he will, at any time,
give six (6) months advance notice and shall not be entitled to any
further compensation after such six months notice period.
11. Assignment. This Agreement is not assignable by the Executive. The Company
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may assign or transfer this Agreement or any rights or obligations hereunder in
the event of a merger, consolidation, reorganization or other combination, or
sale or other transfer of all or substantially all of the assets of the Company.
12. Notices. Any notices hereunder shall be properly given if by personal
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delivery or registered or certified mail, return receipt requested, as follows:
If to Executive:
Dr.Bernhard Steiner
Am Rosenwald 14 D-65779 Kelkheim-Ruppertshain
If to the Company:
Corporate Secretary
Clean Diesel Technologies, Inc.
300 Atlantic Street, Suite 702
Stamford CT 06901 USA
or to such other addresses as the parties may designate in writing.
13. Integration; Modification. This Agreement shall supercede all previous
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negotiations, commitments and writings with respect to the employment of the
Executive. This Agreement may not be released, discharged, abandoned, changed
or modified in any manner, except by an instrument in writing signed by the
Executive and by a duly authorized officer or representative of the Company.
The failure of any party hereto to enforce at any time any of the provisions of
this Agreement shall in no way be construed to be a waiver of any such
provisions, nor in any way to affect the validity of this Agreement or any part
thereof or the right of any party thereafter to enforce each and every
provision. No waiver of any breach of this Agreement shall be held to be a
waiver of any other or subsequent breach.
14. Survival of Certain Obligations. The rights and obligations of the parties
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pursuant to Sections 5, 6, 7 and 8 above shall survive the termination of this
Agreement.
15. Provisions Void. if any term or provision of this Agreement is declared
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invalid by a court of competent jurisdiction, the remaining terms and provisions
of this Agreement shall remain unimpaired.
16. Governing Law. This Agreement shall be construed and the rights of the
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parties hereunder shall be governed by the laws of the State of Delaware, USA
relating to contracts to be entirely performed within such State without
reference to any rules relating to conflicts of laws.
17. Counterparts. This Agreement may be executed in two or more counterparts,
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each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, each of the parties hereto has duly executed this
Agreement this 13 day of August, 2004.
Clean Diesel Technologies, Inc.
/s/ J.D. Peter-Hoblyn /s/ Bernhard Steiner
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By: Jeremy D. Peter-Hoblyn Bernhard Steiner
Chief Executive Officer