O2DIESEL CORPORATION FORM OF RESTRICTED STOCK AGREEMENT
O2DIESEL
CORPORATION
FORM
OF RESTRICTED STOCK AGREEMENT
Restricted
Stock Agreement (“Agreement”) between O2Diesel Corporation (the “Company”) and
__________ (the “Grantee”) dated __________, 2006 (the “Date of
Grant”).
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Grant;
Plan Incorporated by Reference.
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(a)
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The
shares of common stock, $0.0001 par value, of the Company listed
on
Exhibit A to this Agreement (the “Restricted Stock”) are hereby issued
pursuant to the terms of the O2Diesel Corporation 2004 Stock Incentive
Plan (the “Plan”) and constitute an Award under Section 9 of the Plan.
Upon execution of this Agreement, the Company shall cause the shares
of
Restricted Stock to be issued in the Grantee's name. During the Restricted
Period, the shares of Restricted Stock issued hereunder shall contain
the
following legend:
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“This
certificate and the shares of stock represented hereby are subject to the terms
and conditions (including the risks of forfeiture and restrictions against
transfer) contained in the O2Diesel Corporation 2004 Stock Incentive Plan
(“Plan”) and an agreement entered into between the registered owner and O2Diesel
Corporation (“Agreement”). Release from such terms and conditions shall be made
only in accordance with the provisions of the Plan and the Agreement, a copy
of
each of which is on file in the office of the Secretary of O2Diesel
Corporation.”
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(b)
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Capitalized
terms used and not otherwise defined in this Agreement shall have
the
respective meanings ascribed to them in the Plan. The Compensation
Committee of the Board of Directors of the Company (the “Committee”)
administers the Plan and its determinations regarding the interpretation
and operation of the Plan are final and binding. A copy of the Plan
has
been provided to you.
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2.
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Schedule
for Vesting of Rights.
Subject to Section 8 hereof, the schedule for vesting of rights (i.e.,
the
date(s) upon which the restrictions, as set forth in this Agreement,
on
Grantee’s rights with respect to the Restricted Stock shall lapse such
that the shares of Restricted Stock are non-forfeitable) is set forth
in
Exhibit
A.
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3.
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Rights
as a Stockholder or Employee.
The Grantee shall have all the rights of a shareholder with respect
to the
Restricted Stock except as provided in Section 4 hereof. Accordingly,
the
Grantee shall have the right during the Restricted Period to vote
the
Restricted Stock and to receive any dividends paid to or made with
respect
to the
Restricted Stock. All such rights shall cease upon forfeiture of
the
Restricted Stock.
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4.
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Award
not Transferable.
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(a)
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During
the Restricted Period relating to any particular shares of Restricted
Stock, neither such shares of Restricted Stock or nor any rights
relating
to such shares may be sold, transferred, assigned, exchanged, pledged,
hypothecated or otherwise encumbered or disposed of by the
Grantee.
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(b)
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The
Company shall not be required (i) to transfer on its books any shares
of
Restricted Stock which shall have been sold or transferred in violation
of
any of the provisions set forth herein, or (ii) to treat as owner
of such
shares or to accord the right to vote or to pay dividends to any
transferee to whom such shares shall have been so
transferred.
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5.
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Termination
of Restrictions.
In the event that the Restricted Period shall terminate with respect
to
particular shares of Restricted Stock and such shares of Restricted
Stock
shall not theretofore have been forfeited to the Company, the Company
shall reissue the shares of Restricted Stock without the legend referred
to in Section 2 hereof and shall deliver in certificated form such
unrestricted shares to the Grantee or his or her legal
representative.
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6.
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Section
83(b) Election.
If the Grantee timely files an election pursuant to Section 83(b)
of the
Code in respect of the Restricted Stock, the Grantee shall promptly
deliver to the Company a copy thereof.
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7.
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Taxes.
Any obligation of the Company to deliver shares upon the termination
of
the Restricted Period with respect to any shares of Restricted Stock,
and
any obligation to deliver any dividends on any shares of Restricted
Stock,
shall be subject to the satisfaction of all applicable federal, state
and
local tax withholding requirements. Unless otherwise determined by
the
Committee, withholding requirements with respect to shares of Restricted
Stock (i) for which no Section 83(b) election is made, shall be satisfied
by the Company’s retention of shares, with a Fair Market Value equal to
the Company’s required withholding obligation, otherwise issuable to the
Grantee as the result of the termination of the Restricted Period,
and
(ii) for which a Section 83(b) election is made, shall be satisfied
by the
Grantee’s delivery of cash to the Company in an amount equal to the
required withholding. Unless otherwise determined by the Committee,
withholding requirements with respect to any dividend paid on shares
of
Restricted Stock during the Restricted Period shall be satisfied
(i) in
the case of a cash dividend, by the Grantee’s delivery of cash to the
Company in an amount equal to the required withholding, and (ii)
in the
case of a stock dividend, by the Company withholding shares from
such
dividend with a Fair Market Value equal to the Company’s required
withholding obligation. The Grantee hereby authorizes and agrees
to all
such tax withholding. For purposes of this Section 7, shares that
are
withheld to satisfy any applicable withholding obligation shall be
valued
at their Fair Market Value on the date the withholding obligation
arises
and in no event shall the aggregate
Fair Market Value of the shares withheld exceed the minimum amount
of
taxes required to be
withheld.
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8.
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Forfeiture.
Notwithstanding anything to the contrary in this Agreement, if the
Grantee's employment with the Company is terminated for any reason,
all
shares of Restricted Stock subject to the provisions hereof which
are not
vested (or do not become vested) at the time of such termination
shall be
forfeited by the Grantee, and neither the Grantee nor any successors,
heirs, assigns or personal representatives of the Grantee shall thereafter
have any further rights or interest in such shares or the certificates
representing such shares. Ownership of any Restricted Stock forfeited
pursuant to this Section 8 shall be transferred back to the
Company.
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9.
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Subject
to the Plan.
The Restricted Stock and this Agreement are subject to the terms
and
conditions of the Plan, which are incorporated herein by reference
and
made a part hereof, but the terms of the Plan shall not be considered
an
enlargement of any benefits under this Agreement. In addition, the
Restricted Stock and this Agreement are subject to any rules and
regulations promulgated by the Committee in accordance with its authority
under the Plan.
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10.
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Restricted
Period.
For purposes of this Agreement, “Restricted Period” shall mean, with
respect to any shares of Restricted Stock, the period of time between
the
Date of Grant and the date on which rights in such shares of Restricted
Stock become vested in accordance with Section 2 hereof or are
forfeited.
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[Signatures
on next page]
IN
WITNESS WHEREOF, the undersigned have executed this Agreement effective on
the
date first set forth above.
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GRANTEE
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O2DIESEL
CORPORATION
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Exhibit
A
GRANTEE:
DATE
OF
GRANT:
NUMBER
OF
SHARES:
VESTING
SCHEDULE:
___________
shares vest on ________ if not previously forfeited.
___________
shares vest on ________ if not previously forfeited.
___________
shares vest on ________ if not previously forfeited.
EFFECT
OF
DEATH OR DISABILITY:
Notwithstanding
the vesting schedule set forth above, if the Grantee’s employment is terminated
due to death or disability, the Grantee shall, as of the date of such death
or
disability become fully vested in all shares granted hereunder. For purposes
of
this paragraph, disability shall mean total and permanent disability under
Section 22(e)(3) of the Internal Revenue Code of 1986, as amended, or the
Grantee becoming entitled to long-term disability benefits under the long-term
disability plan of the Company.
