Exhibit 10(h)
CLEAN DIESEL TECHNOLOGIES, INC.
1994 INCENTIVE PLAN - - NON-QUALIFIED STOCK OPTION AWARD AGREEMENT
NON-QUALIFIED STOCK OPTION AWARD AGREEMENT dated as of {DATE] between
Clean Diesel Technologies, Inc., a Delaware corporation (the "Company") of 300
Atlantic Street, Stamford Connecticut 06901 U.S.A., and
{NAME] (the "Participant"), an employee of the Company.
WHEREAS, the Company desires to afford to the Participant an opportunity to
purchase shares of the Company's Common Stock pursuant to the grant of a
non-qualified stock option award under the Company's 1994 Incentive Plan (the
"Plan"); and
WHEREAS, the Participant desires to obtain such opportunity;
NOW THEREFORE, the parties agree, as follows:
1. Option Grant. The Company grants to the Participant as of the date
-------------
first written above (the "Grant Date") the right and non-qualified option ("this
Option"), to purchase XXX (XXX) shares of Common Stock of the Company, par value
$0.05 per share ("the Stock") at the exercise price per share of U.S. $XX.XX,
subject, in all respects, to the terms and conditions of the Plan and to the
following terms and conditions.
2. Vesting. This Option shall only be first exercisable, in whole or in
-------
part, with respect to the shares optioned, as to 33 1/3% thereof, immediately on
the Grant Date, and, as to 66 2/3% and 100% thereof, after 5:00 p.m. on the day
preceding the first and second anniversaries, respectively, of the Grant Date.
Pursuant to and as defined in the Plan, however, this Option shall immediately
vest upon a Change of Control of the Company.
3. Term and Termination. (a) The term of this Option shall be a period
----------------------
commencing on the Grant Date and ending at 5:00 p.m. on the date preceding the
tenth anniversary thereof ("Expiration Date"). Upon the termination of the
Participant's status as an employee of the Company on account of:
(i) reasons other than normal retirement, death, total disability and cause,
such portion of this option that has not then vested shall terminate immediately
but such portion of this option that has then vested shall continue and become
non-exercisable immediately at 5:00 p.m. upon a date (in no event later than the
Expiration Date) after such termination of the Participant's status which is
determined under the following table and corresponds to the Participant's length
of service with the Company:
Length of Service Time Within Which to Exercise
----------------- -----------------------------
Less than three (3) years One hundred eighty (180) days
Between three (3) and five (5) years Two (2) years
Between five (5) and seven (7) years Three (3) years
More than seven (7) years Five (5) years
Notwithstanding the foregoing, however, if there shall be a change of control in
which seventy five percent (75%) or more of the capital stock or assets of the
Company shall have been acquired by a single person or a control group, then the
time within which to exercise this option shall be limited to one hundred eighty
(180) days following the Participant's change in status.
(ii) death, total disability or normal retirement, such portion of this
option that has not then vested shall terminate immediately but such portion of
this
Option that has then vested may be exercised by the Participant or, pursuant to
and as defined in the Plan, the Participant's Beneficiary, at any
Stock Option Agreement [DATE]
time during the period ending on the Expiration Date (provided that such option
would have been able to have been exercised according to its terms absent such
death, total disability or normal retirement); or
(iii) cause, in which case all options granted hereunder shall terminate and be
immediately nonexercisable.
(b) Notwithstanding the foregoing, where termination shall not have been for
cause, of which the Board shall be the sole judge, the Board may in its sole
discretion permit options hereunder to be exercised by the Participant at any
time during the period ending not later than the Expiration Date as the Board
shall agree, provided such option would have been able to have been exercised
according to its terms absent termination.
(c) "Normal Retirement" shall mean resignation of the Participant's status as an
employee or officer of the Company or a subsidiary thereof on or after attaining
age sixty-five (65) or such earlier age as to which the Board shall consent.
"Cause" shall mean, in the sole judgement of the Board, conviction of the
Participant under, or a plea of guilty by the participant to any State or
Federal felony charge (or the equivalent thereof outside of the United States);
any instance of fraud, embezzlement, self-dealing, insider trading or similar
malfeasance with respect to the Company regardless of amount; substance or
alcohol abuse; or other conduct for which dismissal has been identified in any
written Company policy statement, as a potential disciplinary measure. "Company"
shall mean a subsidiary of the Company.
4. Method of Exercise. This Option may be exercised only by one or more
--------------------
notices from time to time in writing of the Participant's intent to exercise
this Award, or a portion thereof, delivered to the Secretary or the Chief
Financial Officer of the Company, or their delegates, accompanied by the
Participant's check or a bank check in the amount of the exercise price, or, in
lieu thereof, by delivery to the Company of that number of shares of the Stock
equal in value (determined on the same basis as for the grant of Awards under
the Plan) to the exercise price and any required withholdings provided in
Section 5 below, or by surrendering to the Company of the shares exercised so
many as shall equal such value, unless the Participant has within a period of
six months previously exercised a Company stock option by delivering or
surrendering shares of the Stock.
5. Taxes. At the time of exercise of this Option, the Participant shall
-----
deliver to the Company, if required by the Company, a check payable to the
Company equal, in the sole opinion of the Company, to the applicable national,
state, provincial and local income or other taxes and other pay-roll related
items legally required to be withheld by reason of such exercise.
6. Securities Laws; Transferability; Governing Law; Arbitration. The
-----------------------------------------------------------------
Stock may only be purchased, if there is with respect to the Stock a
registration statement or qualification in effect under applicable U.S. or State
securities laws or an exemption therefrom. This Option may not be transferred,
assigned or pledged except in accordance with the Plan. This Option is governed
by Connecticut Law and any disputes relating to this Option shall be determined
in arbitration as provided in the Plan.
IN WITNESS WHEREOF, the Company and the Participant have each executed this
Agreement, all as of the day and year first above written.
Clean Diesel Technologies, Inc.
By
(Vice) President Participant