Exhibit 10.61

ADA-ES AMENDED AND RESTATED 2007 EQUITY INCENTIVE PLAN

NOTICE OF STOCK OPTION AWARD

 

Grantee’s Name and Address:  

 

 

 

 

 

You (the “Grantee”) have been granted an option to purchase shares of Common
Stock, subject to the terms and conditions of this Notice of Stock Option Award
(the “Notice”), the ADA-ES Amended and Restated 2007 Equity Incentive Plan, as
amended from time to time (the “Plan”) and the Stock Option Award Agreement (the
“Option Agreement”) attached hereto, as follows. Unless otherwise defined
herein, the terms defined in the Plan shall have the same defined meanings in
this Notice.

 

Award Number   

 

Date of Award   

 

Vesting Commencement Date   

 

Exercise Price per Share   

$

 

 

Total Number of Shares Subject to the Option (the “Shares”)   

 

Total Exercise Price    $  

     

Type of Option:                      Incentive Stock Option                    
 Non-Qualified Stock Option Expiration Date:   

 

Post-Termination Exercise Period:    Three (3) Months

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Vesting Schedule:

Subject to the Grantee’s Continuous Service and other limitations set forth in
this Notice, the Plan and the Option Agreement, the Option may be exercised, in
whole or in part, in accordance with the following schedule:

 

Period of Grantee’s Continuous

Relationship With the Company or

Affiliate From the Date the Option is

Granted

   Portion of Total Option Which is
Exercisable  

End of         months

              % 

Each month thereafter

              % 

        months

     100   

During any authorized leave of absence, the vesting of the Option as provided in
this schedule shall be suspended after the leave of absence exceeds a period of
ninety (90) days. Vesting of the Option shall resume upon the Grantee’s
termination of the leave of absence and return to service to the Company or a
Related Entity. The Vesting Schedule of the Option shall be extended by the
length of the suspension.

In the event of termination of the Grantee’s Continuous Service for Cause, the
Grantee’s right to exercise the Option shall terminate concurrently with the
termination of the Grantee’s Continuous Service, except as otherwise determined
by the Administrator.

In the event of the Grantee’s change in status from Employee to Consultant or
from an Employee whose customary employment is 20 hours or more per week to an
Employee whose customary employment is fewer than 20 hours per week, vesting of
the Option shall continue only to the extent determined by the Administrator as
of such change in status, provided that in no case shall such change in status
be considered a “separation of service” as defined in Code Section 409A.

[Signature page follows]

 

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IN WITNESS WHEREOF, the Company and the Grantee have executed this Notice and
agree that the Option is to be governed by the terms and conditions of this
Notice, the Plan and the Option Agreement.

 

ADA-ES, INC., a Colorado corporation By:  

 

Title:  

 

The Grantee acknowledges and agrees that the Shares subject to the Option shall
vest, if at all, only during the period of the Grantee’s Continuous Service (not
through the act of being hired, being granted the Option or acquiring Shares
hereunder). The Grantee further acknowledges and agrees that nothing in this
Notice, the Option Agreement or the Plan shall confer upon the Grantee any right
with respect to future Awards or continuation of the Grantee’s Continuous
Service or interfere in any way with the Grantee’s right or the right of the
Company or Related Entity to which the Grantee provides services to terminate
the Grantee’s Continuous Service, with or without cause and with or without
notice. The Grantee acknowledges that unless the Grantee has a written
employment agreement with the Company to the contrary, the Grantee’s status is
at will.

The Grantee acknowledges receipt of a copy of the Plan and the Option Agreement
and represents that he or she:

(a) is familiar with the terms and provisions thereof and hereby accepts the
Option, effective as of the date of grant stated above, subject to all of the
terms and provisions hereof and thereof;

(b) has reviewed this Notice, the Plan and the Stock Option Award Option
Agreement being executed and delivered herewith in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Notice and
fully understands all provisions of this Notice, the Plan and the Option Award
Agreement.

Grantee hereby agrees that all disputes arising out of or relating to this
Notice, the Plan and the Option Agreement shall be resolved in accordance with
Section 18 of the Option Agreement.

Grantee further agrees to notify the Company upon any change in the residence
address indicated in this Notice.

Grantee agrees, as a condition precedent to any exercise of the Option, to
deliver to the Company:

(a) an executed Exercise Notice in the form provided by the Company, which
notice may include (i) written assurances satisfactory to the Company as to
Grantee’s knowledge and experience in financial and business matters and/or that
Grantee has employed a purchaser representative who has such knowledge and
experience in financial and business matters, and that Grantee is capable of
evaluating, alone or together with a purchaser representative engaged by
Grantee, the merits and risks of exercising the Option; and (ii) written
assurances satisfactory to the Company stating that Grantee is acquiring the
Common Stock subject to the Option for such person’s own account and not with
any present intention of selling or otherwise distributing the Common Stock.
(These requirements, and any assurances given pursuant to such requirements,
shall be inoperative if, and only if: (x) the issuance of the Shares upon the
exercise of the Option has been registered under a then currently effective
registration statement under the Securities Act of 1933, as amended; or (y) as
to any particular requirement, a determination is made by counsel for the
Company that such requirement need not be met in the circumstances under the
then applicable securities law.); and

(b) an executed Shareholders Agreement (if any) in the form existing at the time
of exercise of the Option (as modified by the Company in its discretion).

 

Dated:  

 

    Signed:  

 

        Grantee

 

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Award Number:                 

ADA-ES INC. AMENDED AND RESTATED 2007 EQUITY INCENTIVE PLAN

STOCK OPTION AWARD AGREEMENT

1. Grant of Option. ADA-ES, Inc., a Colorado corporation (the “Company”), hereby
grants to the Grantee (the “Grantee”) named in the Notice of Stock Option Award
(the “Notice”), an option (the “Option”) to purchase the Total Number of Shares
of Common Stock subject to the Option (the “Shares”) set forth in the Notice, at
the Exercise Price per Share set forth in the Notice (the “Exercise Price”)
subject to the terms and provisions of the Notice, this Stock Option Award
Agreement (the “Option Agreement”) and the Company’s Amended and Restated 2007
Equity Incentive Plan, as amended from time to time (the “Plan”), which are
incorporated herein by reference. Unless otherwise defined herein, the terms
defined in the Plan shall have the same defined meanings in this Option
Agreement.

If designated in the Notice as an Incentive Stock Option, the Option is intended
to qualify as an Incentive Stock Option as defined in Section 422 of the Code.
However, notwithstanding such designation, to the extent that the aggregate Fair
Market Value of Shares subject to Options designated as Incentive Stock Options
which become exercisable for the first time by the Grantee during any calendar
year (under all plans of the Company or any Parent or Subsidiary of the Company)
exceeds $100,000, such excess Options, to the extent of the Shares covered
thereby in excess of the foregoing limitation, shall be treated as Non-Qualified
Stock Options. For this purpose, Incentive Stock Options shall be taken into
account in the order in which they were granted, and the Fair Market Value of
the Shares shall be determined as of the date the Option with respect to such
Shares is awarded.

If designated in the Notice as a Nonqualified Stock Option, the Option is NOT
intended to qualify as an Incentive Stock Option.

To the extent any Stock Option is designated as an Incentive Stock Option, but
for any reason (including the reason described above) fails to qualify as an
Incentive Stock Option, such option shall be treated as a Nonqualified Stock
Option.

2. Exercise of Option.

(a) Right to Exercise. The Option shall be exercisable during its term in
accordance with the Vesting Schedule set out in the Notice and with the
applicable provisions of the Plan and this Option Agreement. The Option shall be
subject to the provisions of Section 11 of the Plan relating to the
exercisability or termination of the Option in the event of a Corporate
Transaction or Change in Control. The Grantee shall be subject to reasonable
limitations on the number of requested exercises during any monthly or weekly
period as determined by the Administrator. In no event shall the Company issue
fractional Shares.

(b) Method of Exercise. The Option shall be exercisable by delivery of an
exercise notice (a form of which is attached hereto as Exhibit A) or by such
other procedure as specified from time to time by the Administrator which shall
state the election to exercise the Option, the whole number of Shares in respect
of which the Option is being exercised and such other provisions as may be
required by the Administrator. The exercise notice shall be delivered in person,
by certified mail or by such other method (including electronic transmission) as
determined from time to time by the Administrator to the Company accompanied by
payment of the Exercise Price. The Option shall be deemed to be exercised upon
receipt by the Company of such notice accompanied by the Exercise Price, which,
to the extent selected, shall be deemed to be satisfied by use of the
broker-dealer sale and remittance procedure to pay the Exercise Price provided
in Section 4(d) below.

(c) Shareholders Agreement. As a condition precedent to any exercise of the
Option, the Grantee shall deliver to the Company at the time of exercise, an
executed Shareholders Agreement in the form existing at the time of exercise of
the Option (as modified by the Company in its discretion as of such time).

 

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(d) Taxes. No Shares will be delivered to the Grantee or other person pursuant
to the exercise of the Option until the Grantee or other person has made
arrangements acceptable to the Administrator for the satisfaction of applicable
income tax and employment tax withholding obligations, including, without
limitation, such other tax obligations of the Grantee incident to the receipt of
Shares or the disqualifying disposition of Shares received on exercise of an
Incentive Stock Option. Upon exercise of the Option, the Company or the
Grantee’s employer may offset or withhold (from any amount owed by the Company
or the Grantee’s employer to the Grantee) or collect from the Grantee or other
person an amount sufficient to satisfy such tax obligations and/or the
employer’s withholding obligations.

3. Grantee’s Representations. The Grantee understands that neither the Option
nor the Shares exercisable pursuant to the Option have been registered under the
Securities Act of 1933, as amended or any United States securities laws. If the
Shares purchasable pursuant to the exercise of the Option have not been
registered under the Securities Act of 1933, as amended, at the time the Option
is exercised, the Grantee shall, if requested by the Company, concurrently with
the exercise of all or any portion of the Option, deliver to the Company his or
her Investment Representation Statement in the form attached hereto as Exhibit
B.

4. Method of Payment. Payment of the Exercise Price shall be made by any of the
following, or a combination thereof, at the election of the Grantee; provided,
however, that such exercise method does not then violate any Applicable Law:

(a) cash;

(b) check;

(c) surrender of Shares or delivery of a properly executed form of attestation
of ownership of Shares as the Administrator may require (including withholding
of Shares otherwise deliverable upon exercise of the Option) which have a Fair
Market Value on the date of surrender or attestation equal to the aggregate
Exercise Price of the Shares as to which the Option is being exercised (but only
to the extent that such exercise of the Option would not result in an accounting
compensation charge with respect to the Shares used to pay the exercise price);
or

(d) payment through a broker-dealer sale and remittance procedure pursuant to
which the Grantee (i) provides written instructions to a Company-designated
brokerage firm to effect the immediate sale of some or all of the purchased
Shares and remit to the Company sufficient funds to cover the aggregate exercise
price payable for the purchased Shares and (ii) provides written directives to
the Company to deliver the certificates for the purchased Shares directly to
such brokerage firm in order to complete the sale transaction.

5. Restriction on Exercise. The Option may not be exercised if the issuance of
the Shares subject to the Option upon such exercise would constitute a violation
of any Applicable Laws.

6. Termination or Change of Continuous Service. If the Grantee’s Continuous
Service terminates other than for Cause, the Grantee may, but only during the
Post-Termination Exercise Period, exercise the portion of the Option that was
vested at the date of such termination (the “Termination Date”). If the
Grantee’s Continuous Service is terminated for Cause, the Grantee’s right to
exercise the Option shall, except as otherwise determined by the Administrator,
terminate concurrently with the termination of the Grantee’s Continuous Service
(also the “Termination Date”). In no event may the Option be exercised later
than the Expiration Date set forth in the Notice. If the Grantee’s status
changes from Employee, Director or Consultant to any other status of Employee,
Director or Consultant, the Option shall remain in effect and vesting of the
Option shall continue only to the extent determined by the Administrator as of
such change in status; provided, however, with respect to any Incentive Stock
Option that remains in effect after a change in status from Employee to Director
or Consultant, such Incentive Stock Option shall cease to be treated as an
Incentive Stock Option and shall be treated as a Non-Qualified Stock Option on
the day three (3) months and one (1) day following such change in status. Except
as provided in Sections 7 and 8 below, to the extent that the Option was
unvested on the Termination Date, such unvested portion of the Option shall
terminate. In addition, except as provided in Sections 7 and 8 below, if the
Grantee does not exercise the vested portion of the Option within the
Post-Termination Exercise Period, such vested portion of the Option shall
terminate.

 

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7. Disability of Grantee. If the Grantee’s Continuous Service terminates as a
result of his or her Disability, the Grantee may, but only within twelve
(12) months from the Termination Date (and in no event later than the Expiration
Date), exercise the portion of the Option that was vested on the Termination
Date; provided, however, that if such Disability is not a “disability” as such
term is defined in Section 22(e)(3) of the Code and the Option is an Incentive
Stock Option, such Incentive Stock Option shall cease to be treated as an
Incentive Stock Option and shall be treated as a Non-Qualified Stock Option on
the day three (3) months and one (1) day following the Termination Date. To the
extent that the Option was unvested on the Termination Date, such unvested
portion of the Option shall terminate. In addition, if the Grantee does not
exercise the vested portion of the Option within the time specified herein, such
vested portion of the Option shall terminate. Section 22(e)(3) of the Code
provides that an individual is permanently and totally disabled if he or she is
unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or which has lasted or can be expected to last for a continuous period of
not less than twelve (12) months.

8. Death of Grantee. If the Grantee’s Continuous Service terminates as a result
of his or her death, or in the event of the Grantee’s death during the
Post-Termination Exercise Period or during the twelve (12) month period
following the Grantee’s termination of Continuous Service as a result of his or
her Disability, the Grantee’s estate, or a person who acquired the right to
exercise the Option by bequest or inheritance, may exercise the portion of the
Option that was vested at the Termination Date, within twelve (12) months from
the date of death (but in no event later than the Expiration Date). To the
extent that the Option was unvested on the date of death, such unvested portion
of the Option shall terminate. In addition, if the vested portion of the Option
is not exercised within the time specified herein, such vested portion of the
Option shall terminate.

9. Transferability of Option. The Option, if an Incentive Stock Option, may not
be transferred in any manner other than by will or by the laws of descent and
distribution and may be exercised during the lifetime of the Grantee only by the
Grantee. The Option, if a Non-Qualified Stock Option, may not be transferred in
any manner other than by will or by the laws of descent and distribution,
provided, however, that a Non-Qualified Stock Option may be transferred to
members of the Grantee’s Immediate Family to the extent and in the manner
authorized by the Administrator. The terms of the Option shall be binding upon
the executors, administrators, heirs and successors of the Grantee.

10. Term of Option. The Option must be exercised no later than the Expiration
Date set forth in the Notice or such earlier date as otherwise provided herein.
After the Expiration Date or such earlier date, the Option shall be of no
further force or effect and may not be exercised.

11. Stop-Transfer Notices. In order to ensure compliance with the restrictions
on transfer set forth in this Option Agreement, the Notice or the Plan, the
Company may issue appropriate “stop transfer” instructions to its transfer
agent, if any, and, if the Company transfers its own securities, it may make
appropriate notations to the same effect in its own records.

12. Refusal to Transfer. The Company shall not be required (i) to transfer on
its books any Shares that have been sold or otherwise transferred in violation
of any of the provisions of this Option Agreement or (ii) to treat as owner of
such Shares or to accord the right to vote or pay dividends to any purchaser or
other transferee to whom such Shares have been so transferred.

13. Tax Consequences. Set forth below is a brief summary as of the date of this
Option Agreement of some of the federal tax consequences of exercise of the
Option and disposition of the Shares. This summary is necessarily incomplete,
and the tax laws and regulations are subject to change. The Grantee should
consult a tax adviser before exercising the Option or disposing of the Shares.

(a) Exercise of Incentive Stock Option. If the Option qualifies as an Incentive
Stock Option, there will be no regular federal income tax liability upon the
exercise of the Option, although the excess, if any, of the Fair Market Value of
the Shares on the date of exercise over the Exercise Price will be treated as
income for purposes of the alternative minimum tax for federal tax purposes and
may subject the Grantee to the alternative minimum tax in the year of exercise.

(b) Exercise of Incentive Stock Option Following Disability. If the Grantee’s
Continuous Service terminates as a result of Disability that is not permanent
and total disability as such term is defined in

 

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Section 22(e)(3) of the Code, to the extent permitted on the date of
termination, the Grantee must exercise an Incentive Stock Option within three
(3) months of such termination for the Incentive Stock Option to be qualified as
an Incentive Stock Option. Section 22(e)(3) of the Code provides that an
individual is permanently and totally disabled if he or she is unable to engage
in any substantial gainful activity by reason of any medically determinable
physical or mental impairment which can be expected to result in death or which
has lasted or can be expected to last for a continuous period of not less than
twelve (12) months.

(c) Exercise of Non-Qualified Stock Option. On exercise of a Non-Qualified Stock
Option, the Grantee will be treated as having received compensation income
(taxable at ordinary income tax rates) equal to the excess, if any, of the Fair
Market Value of the Shares on the date of exercise over the Exercise Price. If
the Grantee is an Employee or a former Employee, the Company will be required to
withhold from the Grantee’s compensation or collect from the Grantee and pay to
the applicable taxing authorities an amount in cash equal to a percentage of
this compensation income at the time of exercise, and may refuse to honor the
exercise and refuse to deliver Shares if such withholding amounts are not
delivered at the time of exercise.

(d) Disposition of Shares. In the case of a Non-Qualified Stock Option, if
Shares are held for more than one year, any gain realized on disposition of the
Shares will be treated as long-term capital gain for federal income tax
purposes. In the case of an Incentive Stock Option, if Shares transferred
pursuant to the Option are held for more than one year after receipt of the
Shares and are disposed more than two years after the Date of Award, any gain
realized on disposition of the Shares also will be treated as capital gain for
federal income tax purposes and subject to the same tax rates and holding
periods that apply to Shares acquired upon exercise of a Non-Qualified Stock
Option. If Shares purchased under an Incentive Stock Option are disposed of
prior to the expiration of such one-year or two-year periods, any gain realized
on such disposition will be treated as compensation income (taxable at ordinary
income rates) to the extent of the difference between the Exercise Price and the
lesser of (i) the Fair Market Value of the Shares on the date of exercise, or
(ii) the sale price of the Shares.

14. Lock-Up Agreement.

(a) Agreement. The Grantee, if such person is an officer, director or owner of
greater than 5% of the Common Stock of the Company at such time (including, for
purposes of determining stock ownership, shares of Common Stock issuable upon
exercise of options or warrants, or conversion of securities convertible into
shares of Common Stock), and if requested by the Company and the lead
underwriter of any public offering of the Common Stock (the “Lead Underwriter”),
hereby irrevocably agrees not to sell, contract to sell, grant any option to
purchase, transfer the economic risk of ownership in, make any short sale of,
pledge or otherwise transfer or dispose of any interest in any Common Stock or
any securities convertible into or exchangeable or exercisable for or any other
rights to purchase or acquire Common Stock (except Common Stock included in such
public offering or acquired on the public market after such offering) during the
180-day period following the effective date of a registration statement of the
Company filed under the Securities Act of 1933, as amended, or such shorter
period of time as the Lead Underwriter may specify. The Grantee further agrees
to sign such documents as may be requested by the Lead Underwriter to effect the
foregoing and agrees that the Company may impose stop-transfer instructions with
respect to such Common Stock subject to the lock-up period until the end of such
period. The Company and the Grantee acknowledge that each Lead Underwriter of a
public offering of the Company’s stock, during the period of such offering and
for the 180-day period thereafter, is an intended beneficiary of this
Section 14.

(b) No Amendment Without Consent of Underwriter. During the period from
identification of a Lead Underwriter in connection with any public offering of
the Company’s Common Stock until the earlier of (i) the expiration of the
lock-up period specified in Section 14(a) in connection with such offering or
(ii) the abandonment of such offering by the Company and the Lead Underwriter,
the provisions of this Section 14 may not be amended or waived except with the
consent of the Lead Underwriter.

15. Code Section 409A Matters. This option is not intended to constitute
“nonqualified deferred compensation” within the meaning of Code Section 409A,
but rather is intended to be exempt from the application of Code Section 409A.
To the extent that this option is nevertheless deemed to be subject to Code
Section 409A for any reason, this option shall be interpreted in accordance with
Code Section 409A and Department of Treasury regulations and other interpretive
guidance issued thereunder, including without limitation any such regulations or
other guidance that may be issued after the date on which this option was
granted (the “Grant Date”).

 

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Notwithstanding any provision herein to the contrary, in the event that
following the Grant Date, the Administrator (as defined in the Plan) determines
that this option may be or become subject to Code Section 409A, the
Administrator may adopt such amendments to the Plan and/or this option or adopt
other policies and procedures (including amendments, policies and procedures
with retroactive effect), or take any other actions that the Administrator
determines are necessary or appropriate to (a) exempt the Plan and/or this
option from the application of Code Section 409A and/or preserve the intended
tax treatment of the benefits provided with respect to this option, or
(b) comply with the requirements of Code Section 409A. Any such action may
include, but is not limited to, delaying payment, to the extent required in
order to avoid accelerated taxation and/or tax penalties under Code
Section 409A, to a Grantee who is a “specified employee” within the meaning of
Code Section 409A to the first day following the six-month period (or, if
earlier, the date of the Grantee’s death) on the date of the Grantee’s
“separation of service” as defined in Code Section 409A. The Company shall use
commercially reasonable efforts to implement the provisions of this Section 15
in good faith; provided that neither the Company, the Administrator nor any
Employee, Director or representative of the Company or of any of its Affiliates
shall have any liability to Grantee with respect to this Section 15. In the
event this Option and or the Award is deemed to be “nonqualified deferred
compensation” as defined in Code Section 409A, the value of such nonqualified
deferred compensation could become taxable to Grantee, and Grantee agrees to
assume and take full responsibility for any such tax consequences.

16. Entire Agreement: Governing Law. The Notice, the Plan and this Option
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and the Grantee with respect to the subject matter
hereof, and may not be modified adversely to the Grantee’s interest except by
means of a writing or writings (including an electronic or facsimile
transmission) signed by the Company and the Grantee. Nothing in the Notice, the
Plan or this Option Agreement (except as expressly provided therein) is intended
to confer any rights or remedies on any persons other than the parties. The
Notice, the Plan and this Option Agreement are to be construed in accordance
with and governed by the internal laws of the State of Colorado without giving
effect to any choice of law rule that would cause the application of the laws of
any jurisdiction other than the internal laws of the State of Colorado to the
rights and duties of the parties. Should any provision of the Notice, the Plan
or this Option Agreement be determined by a court of law to be illegal or
unenforceable, such provision shall be enforced to the fullest extent allowed by
law and the other provisions shall nevertheless remain effective and shall
remain enforceable.

17. Headings. The captions used in the Notice and this Option Agreement are
inserted for convenience and shall not be deemed a part of the Option for
construction or interpretation.

18. Dispute Resolution. The provisions of this Section 18 shall be the exclusive
means of resolving disputes arising out of or relating to the Notice, the Plan
and this Option Agreement. The Company, the Grantee and the Grantee’s assignees
(the “parties”) shall attempt in good faith to resolve any disputes arising out
of or relating to the Notice, the Plan and this Option Agreement by negotiation
between individuals who have authority to settle the controversy. Negotiations
shall be commenced by either party by notice of a written statement of the
party’s position and the name and title of the individual who will represent the
party. Within thirty (30) days of the written notification, the parties shall
meet at a mutually acceptable time and place, and thereafter as often as they
reasonably deem necessary, to resolve the dispute. If the dispute is not
resolved by negotiation within ninety (90) days of the written notification, the
parties agree that any suit, action, or proceeding arising out of or relating to
the Notice, the Plan or this Option Agreement shall be brought in the United
States District Court for the District of Colorado (or should such court lack
jurisdiction to hear such action, suit or proceeding, in a Colorado state court
in Arapahoe County, Colorado) and that the parties shall submit to the
jurisdiction of such court. The parties irrevocably waive, to the fullest extent
permitted by law, any objection the party may have to the laying of venue for
any such suit, action or proceeding brought in such court. The parties also
expressly waive any right they have or may have to a jury trial of any such
suit, action or proceeding. If any one or more provisions of this Section 18
shall for any reason be held invalid or unenforceable, it is the specific intent
of the parties that such provisions shall be modified to the minimum extent
necessary to make it or its application valid and enforceable.

19. Notices. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given, (i) when delivered personally;
(ii) when sent by facsimile, with written confirmation of receipt by the sending
facsimile machine; (iii) when sent by electronic transmission, upon written
confirmation of receipt by the receiving party; (iv) five business days after
being sent by registered or certified mail, return receipt requested,

 

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postage prepaid; or (v) two business days after deposit with a private industry
express courier, with written confirmation of receipt, addressed to the other
party at its address as shown in these instruments, or to such other address as
such party may designate in writing from time to time to the other party.

 

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EXHIBIT A

ADA-ES AMENDED AND RESTATED 2007 EQUITY INCENTIVE PLAN

EXERCISE NOTICE

ADA-ES, Inc.

9135 South Ridgeline Boulevard, Suite 200

Highlands Ranch, Colorado 80129

Attention: Secretary

1. Effective as of today,                     , the undersigned (“Grantee”)
hereby elects to exercise the Grantee’s option to purchase
                shares of the Common Stock (the “Shares”) of ADA-ES, Inc. (the
“Company”) under and pursuant to the Company’s Amended and Restated 2007 Equity
Incentive Plan, as amended from time to time (the “Plan”) and the
[            ] Incentive [            ] Non-Qualified Stock Option Award
Agreement (the “Option Agreement”) and Notice of Stock Option Award (the
“Notice”) dated             ,         . Unless otherwise defined herein, the
terms defined in the Plan shall have the same defined meanings in this Exercise
Notice.

2. Representations of the Grantee. The Grantee acknowledges that the Grantee has
received, read and understood the Notice, the Plan and the Option Agreement and
agrees to abide by and be bound by their terms and conditions. Grantee further
represents and warrants that: Grantee has such knowledge and experience in
financial and business matters and/or that Grantee has employed a purchaser
representative who has such knowledge and experience in financial and business
matters such that Grantee is capable of evaluating, either alone or together
with such purchaser representative engaged by Grantee, the merits and risks of
exercising the Option and owning the Shares; and (ii) that Grantee is acquiring
the Shares subject to the Option for his or her own account and not with any
present intention of selling or otherwise distributing the Shares, unless the
Shares are registered under the Securities Act of 1933, as amended, in which
case Grantee will be free to immediately sell the Shares into any market which
may exist therefor.

3. Rights as Shareholder. Until the stock certificate evidencing such Shares is
issued (as evidenced by the appropriate entry on the books of the Company or of
a duly authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a shareholder shall exist with respect to the
Shares, notwithstanding the exercise of the Option. The Company shall issue (or
cause to be issued) such stock certificate promptly after the Option is
exercised. No adjustment will be made for a dividend or other right for which
the record date is prior to the date the stock certificate is issued, except as
provided in Section 10 of the Plan. The Grantee shall enjoy rights as a
shareholder until such time as the Grantee disposes of the Shares or the Company
and/or its assignee(s) exercises the Right of First Refusal or the Repurchase
Right. Upon such exercise, the Grantee shall have no further rights as a holder
of the Shares so purchased except the right to receive payment for the Shares so
purchased in accordance with the provisions of the Option Agreement, and the
Grantee shall forthwith cause the certificate(s) evidencing the Shares so
purchased to be surrendered to the Company for transfer or cancellation.

4. Shareholders Agreement. As a condition precedent to the exercise of the
Option, the Grantee agrees to deliver to the Company an executed Shareholders
Agreement in the form existing at the time of exercise of the Option (as
modified by the Company in its discretion).

5. Delivery of Payment. The Grantee herewith delivers to the Company the full
Exercise Price for the Shares, which, to the extent selected, shall be deemed to
be satisfied by use of the broker-dealer sale and remittance procedure to pay
the Exercise Price provided in Section 4(d) of the Option Agreement.

6. Tax Consultation. The Grantee understands that the Grantee may suffer adverse
tax consequences as a result of the Grantee’s purchase or disposition of the
Shares. The Grantee represents that the Grantee has consulted with any tax
consultants the Grantee deems advisable in connection with the purchase or
disposition of the Shares and that the Grantee is not relying on the Company for
any tax advice.

 

10

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7. Taxes. The Grantee agrees to satisfy all applicable federal, state and local
income and employment tax withholding obligations and herewith delivers to the
Company the full amount of such obligations or has made arrangements acceptable
to the Company to satisfy such obligations. In the case of an Incentive Stock
Option, the Grantee also agrees, as partial consideration for the designation of
the Option as an Incentive Stock Option, to notify the Company in writing within
thirty (30) days of any disposition of any shares acquired by exercise of the
Option if such disposition occurs within two (2) years from the Date of Award or
within one (1) year from the date the Shares were transferred to the Grantee. If
the Company is required to satisfy any federal, state or local income or
employment tax withholding obligations as a result of such an early disposition,
the Grantee agrees to satisfy the amount of such withholding in a manner that
the Administrator prescribes.

8. Restrictive Legends. The Grantee understands and agrees that unless the
Shares are presently registered under the Securities Act of 1933, as amended,
the Company may cause the legends set forth below or legends substantially
equivalent thereto, to be placed upon any certificate(s) evidencing ownership of
the Shares together with any other legends that may be required by the Company
or by state or federal securities laws:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 (THE “ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL
REGISTERED UNDER THE ACT OR, IN THE OPINION OF COUNSEL SATISFACTORY TO THE
ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR
HYPOTHECATION IS IN COMPLIANCE THEREWITH.

9. Successors and Assigns. The Company may assign any of its rights under this
Exercise Notice to single or multiple assignees, and this agreement shall inure
to the benefit of the successors and assigns of the Company. Subject to the
restrictions on transfer herein set forth, this Exercise Notice shall be binding
upon the Grantee and his or her heirs, executors, administrators, successors and
assigns.

10. Headings. The captions used in this Exercise Notice are inserted for
convenience and shall not be deemed a part of this agreement for construction or
interpretation.

11. Dispute Resolution. The provisions of Section 18 of the Option Agreement
shall be the exclusive means of resolving disputes arising out of or relating to
this Exercise Notice.

12. Governing Law; Severability. This Exercise Notice is to be construed in
accordance with and governed by the internal laws of the State of Colorado
without giving effect to any choice of law rule that would cause the application
of the laws of any jurisdiction other than the internal laws of the State of
Colorado to the rights and duties of the parties. Should any provision of this
Exercise Notice be determined by a court of law to be illegal or unenforceable,
such provision shall be enforced to the fullest extent allowed by law and the
other provisions shall nevertheless remain effective and shall remain
enforceable.

13. Notices. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given (i) when delivered personally;
(ii) when sent by facsimile, with written confirmation of receipt by the sending
facsimile machine; (iii) when sent by electronic transmission, upon written
confirmation of receipt by the receiving party; (iv) five business days after
being sent by registered or certified mail, return receipt requested, postage
prepaid; or (v) two business days after deposit with a private industry express
courier, with written confirmation of receipt, addressed to the other party at
its address as shown below beneath its signature, or to such other address as
such party may designate in writing from time to time to the other party.

14. Further Instruments. The parties agree to execute such further instruments
and to take such further action as may be reasonably necessary to carry out the
purposes and intent of this agreement.

15. Entire Agreement. The Notice, the Plan, the Option Agreement and
Shareholders Agreement, if any, are incorporated herein by reference and
together with this Exercise Notice constitute the entire agreement of the
parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and the Grantee
with respect to the subject matter hereof, and may not be modified adversely to
the Grantee’s interest except by means of a writing or writings (including an
electronic or facsimile

 

11

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transmission) signed by the Company and the Grantee. Nothing in the Notice, the
Plan, the Option Agreement and this Exercise Notice (except as expressly
provided therein) is intended to confer any rights or remedies on any persons
other than the parties.

 

Submitted by:       Accepted by: GRANTEE       ADA-ES, INC., a Colorado
corporation

 

      By:  

 

(Signature)               Title:  

 

 

Address:       Address:  

 

      9135 South Ridgeline Boulevard, Suite 200           Highlands Ranch,
Colorado 80129  

 

        Email:  

 

        Facsimile:  

 

       

 

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EXHIBIT B

ADA-ES AMENDED AND RESTATED 2007 EQUITY INCENTIVE PLAN

INVESTMENT REPRESENTATION STATEMENT

GRANTEE:

COMPANY: ADA-ES, INC.

SECURITY: COMMON STOCK

AMOUNT:

DATE:

In connection with the purchase of the above-described securities (the
“Shares”), the undersigned Grantee represents to the Company the following:

(a) Grantee is aware of the Company’s business affairs and financial condition
and has acquired sufficient information about the Company to reach an informed
and knowledgeable decision to acquire the Shares. Grantee is acquiring these
Shares for investment for Grantee’s own account only and not with a view to, or
for resale in connection with, any “distribution” thereof within the meaning of
the Securities Act of 1933, as amended (the “Securities Act”).

(b) Grantee acknowledges and understands that unless the Shares are registered
under the Securities Act, the shares will constitute “restricted securities”
under the Securities Act and will have not been registered under the Securities
Act in reliance upon a specific exemption therefrom, which exemption depends
upon among other things, the bona fide nature of Grantee’s investment intent as
expressed herein. Grantee further understands that the Shares must be held
indefinitely unless they are subsequently registered under the Securities Act or
an exemption from such registration is available. Grantee further acknowledges
and understands that the Company is under no obligation to register the Shares.
Grantee understands that unless the Shares are registered under the Securities
Act at the time of issuance, the certificate evidencing the Shares will be
imprinted with a legend which prohibits the transfer of the Shares unless they
are registered or such registration is not required in the opinion of counsel
satisfactory to the Company.

(c) Grantee is familiar with the provisions of Rule 144 promulgated under the
Securities Act, which, in substance, permit limited public resale of “restricted
securities” acquired, directly or indirectly from the issuer thereof, in a
non-public offering subject to the satisfaction of certain conditions. Subject
to the availability of certain public information about the Company, if the
Shares are not registered for resale under an effective registration statement
on file with the Securities and Exchange Commission at the time of the exercise
of the Option, then the Shares may be resold in certain limited circumstances
subject to the provisions of Rule 144 if Grantee is not an affiliate of the
Company and has not been an affiliate for the preceding three months. If Grantee
is or has been an affiliate of the Company in the preceding three months,
Grantee may resell the Shares pursuant to Rule 144 subject to the satisfaction
of certain conditions specified in the rule, including: (1) the resale being
made through a broker in an unsolicited “broker’s transaction” or in
transactions directly with a market maker (as said term is defined under the
Securities Exchange Act of 1934, as amended), (2) the availability of certain
public information about the Company, (3) the amount of Shares being sold during
any three month period not exceeding the limitations specified in Rule 144(e),
and (4) the timely filing of a Form 144, if applicable. The resale must occur
not less than six months after the later of the date the Shares were sold by the
Company or the date the Shares were sold by an affiliate of the Company (within
the meaning of Rule 144). Other restrictions may also apply to sales of the
Shares, and Grantee understands that the Shares may not be readily resold, and
that delays may occur in selling the Shares even if they are eligible for sale
under Rule 144.

 

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(d) Grantee further understands that if all of the applicable requirements of
Rule 144 are not satisfied, that registration under the Securities Act,
compliance with Regulation A or some other registration exemption will be
required and that, notwithstanding the fact that Rule 144 is not exclusive, the
Staff of the Securities and Exchange Commission has expressed its opinion that
persons proposing to sell private placement securities other than in a
registered offering and otherwise than pursuant to Rules 144 will have a
substantial burden of proof in establishing that an exemption from registration
is available for such offers or sales, and that such persons and their
respective brokers who participate in such transactions do so at their own risk.
Grantee understands that no assurances can be given that any such other
registration exemption will be available in such event, and that the Shares may
not be salable by Grantee.

(e) Grantee represents that Grantee is a resident of the state of
                            .

 

Signature of Grantee:

 

 

[Print Name of Grantee] Date:            ,        

 

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EXHIBIT C

Addendum to the ADA-ES, Inc.

Amended and Restated 2007 Equity Incentive Plan

Option Agreement

For California Residents Only

This Addendum is intended to comply with Section 25102(o) of the California
Corporations Code and any rules or regulations promulgated thereunder by the
California Department of Corporations. Any provision of the Plan or any Option
Agreement which is otherwise inconsistent with this Addendum or Section 25102(o)
of the California Securities Code shall, without further act or amendment by the
Company, be reformed to comply with Section 25102(o) of the California
Securities Code. Both the Common Stock and the Options that are the subject of
this Addendum if not yet qualified with the California Department of
Corporations and not yet exempt from such qualification, are subject to such
qualification, and the issuance of the Options prior to the qualification is
unlawful unless such issuance is exempt. The rights of the Company and the
Option holder with respect to Options that are the subject of this Addendum are
expressly conditioned on such exemption being available.

In addition to those provisions set forth in the Plan, any Option Agreement
and/or the Shareholders Agreement, Options granted to employees of the Company
or an Affiliate resident in California (“California Employees”) will be subject
to the following provisions:

 

1. Each California Employee will receive financial statements of the Company
annually during the period such California Employee has Options outstanding.
This requirement does not apply to California Employees who are key employees
whose duties in connection with the Company or an Affiliate assure them access
to equivalent information.

 

2. Unless employment of a California Employee is terminated “for cause” under
applicable law, the terms of the Plan, the Option Agreement, the Option grant or
the California Employee’s contract of employment, the right to exercise the
California Employee’s Option in the event of termination of his or her
employment, to the extent the California Employee is entitled to exercise such
Option on the date his or her employment terminates, shall be as follows:

 

(i) Such Option may be exercised for at least 6 months from the date of such
termination, if termination was caused by death or Disability.

 

(ii) Such Option may be exercised for at least 30 days from the date of such
termination if termination was caused by other than death or Disability.

Notwithstanding the foregoing, such Option may not be exercised after the
expiration of the stated period of the Option.

 

3. At the discretion of the Committee, the Company may reserve to itself and/or
its assignee in the Option Agreement, or any other agreement with the California
Employee, a right to repurchase Common Stock held by a California Employee or
his or her transferee in the event of such California Employee’s termination of
employment with the Company or an Affiliate at any time within 90 days after the
date of such termination (or in the case of Common Stock issued upon exercise of
an Option after such termination date, within 90 days after the date of such
exercise) for cash or cancellation of purchase money indebtedness, at:

 

(A) no less than the Fair Market Value of such Common Stock as of the date of
such termination of employment, provided that such right to repurchase Common
Stock terminates when the common Stock has become publicly traded; or

 

15

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(B) the California Employee’s original purchase price, provided that such right
to repurchase Common Stock at the original purchase price lapses at the rate of
at least 20% of the Common Stock subject to the Option per year over 5 years
from the date the Option is granted (without respect to the date the Option was
exercised or became exercisable).

Notwithstanding the foregoing, the Common Stock held by a California Employee
who is an officer, director, manager or consultant of the Company or an
Affiliate may be subject to additional or greater restrictions than those set
forth in this item 3 above.

 

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RESTRICTED STOCK PURCHASE AGREEMENT

ADA-ES, INC. AMENDED AND RESTATED 2007 EQUITY INCENTIVE PLAN

[Preliminary Note: Language appearing in boldface and brackets in both the
Notice and the Agreement refers to provisions that are electable, and the
language must be reviewed and either included or removed, as appropriate, in the
process of finalizing all agreements.]

NOTICE OF RESTRICTED STOCK PURCHASE AWARD

 

Grantee’s Name and Address:  

 

   

 

   

 

 

You have been granted the right to purchase shares of Common Stock of the
Company, subject to the terms and conditions of this Notice of Restricted Stock
Purchase Award (the “Notice”), under the ADA-ES, INC. Amended and Restated 2007
Equity Incentive Plan, as amended from time to time (the “Plan”) and the
Restricted Stock Purchase Award Agreement (the “Agreement”) attached hereto, as
follows. Unless otherwise defined herein, the terms defined in the Plan shall
have the same defined meanings in this Notice.

 

Award Number  

 

  Grant Date  

 

  Vesting Commencement Date  

 

  Purchase Price per Share  

 

 

Total Number of Shares

of Common Stock Awarded

 

 

  Total Purchase Price  

 

 

Vesting Schedule:

Subject to Grantee’s Continuous Service and other limitations set forth in this
Notice, the Agreement and the Plan, the Shares will “vest” in accordance with
the following schedule:

NOTE: CHOOSE ONE OF THE FOLLOWING ALTERNATIVES OR SOME OTHER VESTING SCHEDULE.
ANY INAPPLICABLE LANGUAGE SHOULD BE DELETED FOR FINALIZING THE DOCUMENTS FOR THE
GRANT.

 

17

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[25% of the Total Number of Shares of Common Stock Awarded shall vest twelve
(12) months after the Vesting Commencement Date, and 1/48 of the Total Number of
Shares of Common Stock Awarded shall vest each month thereafter until the Shares
are fully vested.]

[25% of the Total Number of Shares of Common Stock Awarded shall vest twelve
(12) months after the Vesting Commencement Date, and an additional 25% of the
Total Number of Shares of Common Stock Awarded shall vest on each yearly
anniversary of the Vesting Commencement Date thereafter.]

[25% of the Total Number of Shares of Common Stock Awarded shall vest twelve
(12) months after the Vesting Commencement Date, and 1/16 of the Total Number of
Shares of Common Stock Awarded shall vest on each three (3) month anniversary of
the Vesting Commencement Date thereafter.]

[During any authorized leave of absence, the vesting of the Shares shall be
suspended [after the leave of absence exceeds a period of [ninety (90)] days].
Vesting of the Shares shall resume upon the Grantee’s termination of the leave
of absence and return to Continuous Service. The Vesting Schedule of the Shares
shall be extended to the length of the suspension.]

[In the event of Grantee’s change in status from Employee or Director to
Consultant, the vesting of the Shares shall continue only to the extent
determined by the Administrator as of such change in status.]

For purposes of this Notice and the Agreement, the term “vest” shall mean, with
respect to any Shares, that such Shares are no longer subject to repurchase at
the Purchase Price per Share; provided, however, that such Shares shall remain
subject to other restrictions on transfer set forth in the Agreement or the
Plan. Shares that have not vested are deemed “Restricted Shares.” If the Grantee
would become vested in a fraction of a Restricted Share, such Restricted Share
shall not vest until the Grantee becomes vested in the entire Share.
Notwithstanding the foregoing, the Shares subject to this Notice will be subject
to the provisions of the Agreement and Section 11 of the Plan relating to the
release of repurchase and forfeiture provisions in the event of a Corporate
Transaction or Change of Control.

[Signature page follows]

 

18

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IN WITNESS WHEREOF, the Company and the Grantee have executed this Notice and
agree that the Award is to be governed by the terms and conditions of this
Notice, the Plan, and the Agreement, and that signed copies of this Notice and
the Agreement (including signed copies of Exhibits A, B and C thereto, as
applicable) have been exchanged between the parties.

 

ADA-ES, INC.

By:

 

 

Title:

 

 

THE GRANTEE ACKNOWLEDGES AND AGREES THAT THE SHARES SHALL VEST, IF AT ALL, ONLY
DURING THE PERIOD OF GRANTEE’S CONTINUOUS SERVICE (NOT THROUGH THE ACT OF BEING
HIRED, BEING GRANTED THIS AWARD OR ACQUIRING SHARES HEREUNDER). THE GRANTEE
FURTHER ACKNOWLEDGES AND AGREES THAT NOTHING IN THIS NOTICE, THE AGREEMENT, NOR
IN THE PLAN, SHALL CONFER UPON THE GRANTEE ANY RIGHT WITH RESPECT TO
CONTINUATION OF GRANTEE’S CONTINUOUS SERVICE, NOR SHALL IT INTERFERE IN ANY WAY
WITH THE GRANTEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE GRANTEE’S
CONTINUOUS SERVICE AT ANY TIME, WITH OR WITHOUT CAUSE, AND WITH OR WITHOUT
NOTICE. THE GRANTEE ACKNOWLEDGES THAT UNLESS THE GRANTEE HAS A WRITTEN
EMPLOYMENT AGREEMENT WITH THE COMPANY TO THE CONTRARY, GRANTEE’S STATUS IS AT
WILL.

The Grantee acknowledges receipt of a copy of the Plan and the Agreement
(including Exhibits A, B & C thereto) and represents that he or she is familiar
with the terms and provisions thereof, and hereby accepts the Award subject to
all of the terms and provisions hereof and thereof. The Grantee has reviewed
this Notice, the Agreement and the Plan in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Notice and
fully understands all provisions of this Notice, the Agreement and the Plan. The
Grantee hereby agrees that all disputes arising out of or relating to this
Notice, the Plan and the Agreement shall be resolved in accordance with
Section 21 of the Agreement. The Grantee further agrees to notify the Company
upon any change in the residence address indicated in this Notice.

 

Dated:  

 

    Signed:  

 

        Print Name:  

 

 

 

19

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Award Number:                     

ADA-ES INC. AMENDED AND RESTATED 2007 EQUITY INCENTIVE PLAN

RESTRICTED STOCK PURCHASE AWARD AGREEMENT

16. Purchase of Shares. ADA-ES INC., a Colorado corporation (the “Company”),
hereby issues and sells to the Grantee (the “Grantee”) named in the Notice of
Restricted Stock Purchase Award (the “Notice”), the Total Number of Shares of
Common Stock Awarded set forth in the Notice (the “Shares”) for a Purchase Price
per Share set forth in the Notice (the “Total Purchase Price”), subject to the
Notice, this Restricted Stock Purchase Award Agreement (the “Agreement”) and the
terms and provisions of the Company’s Amended and Restated 2007 Equity Incentive
Plan, as amended from time to time (the “Plan”), which is incorporated herein by
reference. Payment for the Shares in the amount of the Total Purchase Price set
forth in the Notice shall be made to the Company upon execution of the Notice.
Unless otherwise defined herein, the terms defined in the Plan shall have the
same defined meanings in this Agreement. All Shares sold hereunder will be
deemed issued to the Grantee as fully paid and nonassessable shares and the
Grantee will have the right to vote the Shares at meetings of the Company’s
shareholders. The Company shall pay any applicable stock transfer taxes imposed
upon the issuance of the Shares to the Grantee hereunder.

17. Method of Payment. Payment of the Total Purchase Price shall be by any of
the following, or a combination thereof, at the election of the Grantee;
provided, however, that such payment method does not then violate an Applicable
Law:

(a) cash;

(b) check; or

(c) [provided that the Total Purchase Price for the Shares being purchased
exceeds [         thousand dollars ($    ,000)], payment pursuant to a
promissory note as described below.

(i) The promissory note shall have a term of          (    ) years with
principal and interest payable in          (    ) equal annual installments;

(ii) The promissory note shall bear interest at the minimum rate required by the
federal tax laws to avoid the imputation of interest income to the Company and
compensation income to the Grantee;

(iii) The Grantee shall be personally liable for payment of the promissory note
and the promissory note shall be secured by the Shares purchased upon delivery
of the promissory note, or such other collateral of equal or greater value, in a
manner satisfactory to the Administrator with such documentation as the
Administrator may request; and

(iv) The promissory note shall become due and payable upon the occurrence of any
or all of the following events: (A) the sale or transfer of the Shares purchased
with the promissory note; (B) termination of the Grantee’s Continuous Service
for any reason other than death or disability; or (C) the first anniversary of
the termination of the Grantee’s Continuous Service due to death or disability.]

[NOTE: If the Company is going to extend credit, it must confirm that it
complies with any applicable Federal Reserve requirements relating to the
extension of credit.]

18. Transfer Restrictions. The Shares sold to the Grantee hereunder may not be
sold, transferred by gift, pledged, hypothecated, or otherwise transferred or
disposed of by the Grantee prior to the date when the Shares become vested
pursuant to the Vesting Schedule set forth in the Notice. Any attempt to
transfer Restricted Shares in violation of this Section 3 will be null and void
and will be disregarded. Before the Shares fully vest, the Shares will be
subject to the Company’s Repurchase Rights as set forth in Section 8 below.

 

20

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19. Escrow of Stock. For purposes of facilitating the enforcement of the
provisions of this Agreement, the Grantee agrees, immediately upon receipt of
the certificate(s) for the Restricted Shares, to deliver such certificate(s),
together with an Assignment Separate from Certificate in the form attached
hereto as Exhibit A, executed in blank by the Grantee and the Grantee’s spouse
(if required for transfer) with respect to each such stock certificate, to the
Secretary or Assistant Secretary of the Company, or their designee, to hold in
escrow for so long as such Restricted Shares have not vested pursuant to the
Vesting Schedule set forth in the Notice and continue to be subject to the
Company’s Repurchase Rights, with the authority to take all such actions and to
effectuate all such transfers and/or releases as may be necessary or appropriate
to accomplish the objectives of this Agreement in accordance with the terms
hereof. The Grantee hereby acknowledges that the appointment of the Secretary or
Assistant Secretary of the Company (or their designee) as the escrow holder
hereunder with the stated authorities is a material inducement to the Company to
make this Agreement and that such appointment is coupled with an interest and is
accordingly irrevocable. The Grantee agrees that such escrow holder shall not be
liable to any party hereto (or to any other party) for any actions or omissions
unless such escrow holder is grossly negligent relative thereto. The escrow
holder may rely upon any letter, notice or other document executed by any
signature purported to be genuine and may resign at any time. Upon the vesting
of all Restricted Shares and termination of the Company’s [Right of First
Refusal] [and Repurchase Right], the escrow holder will, without further order
or instruction, transmit to the Grantee the certificate evidencing such Shares,
subject, however, to satisfaction of any withholding obligations provided in
Section 6 below [, and subject to the terms of any security agreement executed
in connection with the purchase of the Shares by means of a promissory note].

20. Distributions. Except as set forth in Section 10(ii), the Company shall
disburse to the Grantee all dividends and other distributions paid or made in
cash with respect to the Shares and Additional Securities (whether vested or
not), less any applicable withholding obligations.

21. Section 83(b) Election and Withholding of Taxes. The Grantee shall provide
the Administrator with a copy of any timely election made pursuant to
Section 83(b) of the Internal Revenue Code or similar provision of state law
(collectively, an “83(b) Election”), a form of which is attached hereto as
Exhibit B. If the Grantee makes a timely 83(b) Election, the Grantee shall
immediately pay the Company the amount necessary to satisfy any applicable
foreign, federal, state, and local income and employment tax withholding
obligations. If the Grantee does not make a timely 83(b) Election, the Grantee
shall, as Restricted Shares vest, or at the time withholding is otherwise
required by any Applicable Law, pay the Company the amount necessary to satisfy
any applicable foreign, federal, state, and local income and employment tax
withholding obligations. The Grantee may satisfy his or her withholding
obligations by authorizing the Company to transfer to the Company the number of
vested Shares held in escrow that have an aggregate Fair Market Value equal to
the withholding obligations. The Grantee hereby represents that he or she
understands (a) the contents and requirements of the 83(b) Election, (b) the
application of Section 83(b) to the receipt of the Shares by the Grantee
pursuant to this Agreement, (c) the nature of the election to be made by the
Grantee under Section 83(b) and the consequences of either making or not making
the 83(b) Election, and (d) the effect and requirements of the 83(b) Election
under relevant state and local tax laws. The Grantee further represents that he
or she intends OR does not intend to file an election pursuant to Section 83(b)
with the Internal Revenue Service within thirty (30) days following the date of
this Agreement, and submit a copy of such election with his or her federal tax
return for the calendar year in which the date of this Agreement falls.

[NOTE: Grantee must cross through the inapplicable language in the preceding
paragraph, and initial here:                                                  .]

22. Additional Securities. Any securities received as the result of ownership of
the Restricted Shares (the “Additional Securities”), including, but not by way
of limitation, warrants, options and securities received as a stock dividend or
stock split, or as a result of a recapitalization or reorganization or other
similar change in the Company’s capital structure, shall be retained in escrow
in the same manner and subject to the same conditions and restrictions as the
Restricted Shares with respect to which they were issued, including, without
limitation, the Vesting Schedule set forth in the Notice and the Company’s
Repurchase Rights. The Grantee shall be entitled to direct the Company to
exercise any warrant, option or other right received as Additional Securities
upon supplying the funds necessary to do so, in which event the securities so
purchased shall constitute Additional Securities, but the Grantee may not direct
the Company to sell any such warrant, option or right. If Additional Securities
consist of a convertible security, the Grantee may exercise any conversion
right, and any securities so acquired shall constitute Additional Securities.
Appropriate adjustments to reflect the distribution of Additional Securities
shall be made to

 

21

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the price per share to be paid upon the exercise of the Repurchase Right in
order to reflect the effect of any such transaction upon the Company’s capital
structure. In the event of any change in certificates evidencing the Shares or
the Additional Securities by reason of any recapitalization, reorganization or
other transaction that results in the creation of Additional Securities, the
escrow holder is authorized to deliver to the issuer the certificates evidencing
the Shares or the Additional Securities in exchange for the certificates of the
replacement securities.

23. Company’s Repurchase Rights.

(f) Grant of Repurchase Rights. The Company is hereby granted the right to
repurchase all or any portion of the Shares that are Restricted Shares (the
“Repurchase Right”) exercisable at any time during the period commencing on the
date the Grantee’s Continuous Service terminates for any reason, with or without
cause (including death or disability) (the “Termination Date”) and ending ninety
(90) days after the first date on which the Repurchase Right may be exercised
without incurring an accounting expense with respect to such exercise (the
“Share Repurchase Period”).

(g) Exercise of the Repurchase Right. The Repurchase Right shall be exercisable
by written notice delivered to the Grantee prior to the expiration of the Share
Repurchase Period. The notice shall indicate the number of Shares to be
repurchased and the date on which the repurchase is to be effected, such date to
be not later than the last day of the Share Repurchase Period. On the date on
which the repurchase is to be effected, the Company and/or its assigns shall pay
to the Grantee in cash or cash equivalents (including the cancellation of any
purchase-money indebtedness) for Restricted Shares being repurchased, the
Purchase Price per Share previously paid by the Grantee to the Company for such
Shares. Upon such payment to the Grantee or into escrow for the benefit of the
Grantee, the Company and/or its assigns shall become the legal and beneficial
owner of the Shares being repurchased and all rights and interest thereon or
related thereto, and the Company shall have the right to transfer to its own
name or its assigns the number of Shares being repurchased, without further
action by the Grantee.

(h) Assignment. Whenever the Company shall have the right to purchase Shares
under this Repurchase Right, the Company may designate and assign one or more
employees, officers, directors or shareholders of the Company or other persons
or organizations, to exercise all or a part of the Company’s Repurchase Right.

(i) Termination of the Repurchase Right. The Repurchase Right shall terminate
with respect to any Shares for which it is not timely exercised. In addition,
the Repurchase Right shall terminate, and cease to be exercisable, with respect
to all vested Shares upon the date on which such shares cease to be Restricted
Shares.

(j) Corporate Transaction/ Change of Control. Immediately prior to the
consummation of a Corporate Transaction described in Section 2(q)(i), (ii) or
(iii) of the Plan or a Change of Control, the Repurchase Right as to all vested
Shares shall automatically lapse in its entirety, except to the extent this
Agreement is Assumed, in which case the Repurchase Right shall apply to the new
capital stock or other property received in exchange for the vested Shares in
consummation of the Corporate Transaction or Change of Control, but only to the
extent the vested Shares are at the time covered by such right. The Repurchase
Right as to Restricted Shares shall apply to the new capital stock or other
property (including cash paid other than as a regular cash dividend) received in
exchange for the Shares in consummation of the Corporate Transaction and such
stock or property shall be deemed Additional Securities for purposes of this
Agreement, but only to the extent the Shares are at the time covered by such
Repurchase Right. Appropriate adjustments shall be made to the price per share
payable upon exercise of the Repurchase Right to reflect the effect of the
Corporate Transaction or Related Entity Disposition.

[NOTE: This section does not contemplate the termination of the Repurchase Right
for unvested Shares upon a Corporate Transaction or Related Entity Disposition.
If the Repurchase Right for unvested Shares were to terminate on an acquisition,
the Award is in effect “accelerated” in that the Grantee would receive full
consideration for the shares on a Corporate Transaction although the vesting
time periods have not elapsed. Consideration should be given to whether either
of the following provisions should be added to all agreements or to agreements
for specific individuals. [To the extent that this Agreement will not be
Assumed, the Repurchase Right as to such Restricted Shares shall automatically
lapse.] Another possibility is to give the Company the option to repurchase the
unvested Shares (at the Exercise Price per Share for the unvested

 

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Shares) in a Corporate Transaction if the Agreement is not Assumed. [Such a
provision would mean that the Grantee only receives the acquisition
consideration for the vested shares and results in the Grantee receiving the
consideration that he would have received if he had vested options rather than
purchased shares.] [To the extent that this Agreement is not Assumed, the
Company shall have the Repurchase Right as to such Restricted Shares pursuant to
Section 8(a) of this Agreement, except that the Share Repurchase Period shall be
the sixty (60) day period immediately preceding the consummation of the
Corporate Transaction or Related Entity Disposition.]

24. Stop-Transfer Notices. In order to ensure compliance with the restrictions
on transfer set forth in this Agreement, the Notice or the Plan, the Company may
issue appropriate “stop transfer” instructions to its transfer agent, if any,
and, if the Company transfers its own securities, it may make appropriate
notations to the same effect in its own records.

25. Refusal to Transfer. The Company shall not be required (i) to transfer on
its books any Shares that have been sold or otherwise transferred in violation
of any of the provisions of this Agreement or (ii) to treat as owner of such
Shares or to accord the right to vote or pay dividends to any purchaser or other
transferee to whom such Shares shall have been so transferred.

26. Restrictive Legends. Grantee understands and agrees that the Company may
cause the legends set forth below or legends substantially equivalent thereto,
to be placed upon any certificate(s) evidencing ownership of the Shares, as
applicable, together with any other legends that may be required by the Company
or by state or federal securities laws:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 (THE “ACT”) AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED,
PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE
OPINION OF COUNSEL SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER,
SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE THEREWITH.

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS
ON TRANSFER, A REPURCHASE RIGHT HELD BY THE ISSUER OR ITS ASSIGNEE(S) AS SET
FORTH IN THE RESTRICTED STOCK PURCHASE AGREEMENT BETWEEN THE ISSUER AND THE
ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE
PRINCIPAL OFFICE OF THE ISSUER SUCH TRANSFER RESTRICTIONS AND REPURCHASE RIGHT
ARE BINDING ON TRANSFEREES OF THESE SHARES.

27. Lock-Up Agreement.

(a) Agreement. Grantee, if such person is an officer, director or owner of
greater than 5% of the Common Stock of the Company at such time (including, for
purposes of determining stock ownership, shares of Common Stock issuable upon
exercise of options or warrants, or conversion of securities convertible into
shares of Common Stock), and if requested by the Company and the lead
underwriter of any public offering of the Common Stock or other securities of
the Company (the “Lead Underwriter”), hereby irrevocably agrees not to sell,
contract to sell, grant any option to purchase, transfer the economic risk of
ownership in, make any short sale of, pledge or otherwise transfer or dispose of
any interest in any Common Stock or any securities convertible into or
exchangeable or exercisable for or any other rights to purchase or acquire
Common Stock (except Common Stock included in such public offering or acquired
on the public market after such offering) during the 180-day period following
the effective date of a registration statement of the Company filed under the
Securities Act of 1933, as amended, or such shorter period of time as the Lead
Underwriter shall specify. Grantee further agrees to sign such documents as may
be requested by the Lead Underwriter to effect the foregoing and agrees that the
Company may impose stop-transfer instructions with respect to such Common Stock
subject until the end of such period. The Company and Grantee acknowledge that
each Lead Underwriter of a public offering of the Company’s stock, during the
period of such offering and for the 180-day period thereafter, is an intended
beneficiary of this Section 12.

 

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(b) No Amendment Without Consent of Underwriter. During the period from
identification as a Lead Underwriter in connection with any public offering of
the Company’s Common Stock until the earlier of (i) the expiration of the
lock-up period specified in Section 12(a) in connection with such offering or
(ii) the abandonment of such offering by the Company and the Lead Underwriter,
the provisions of this Section 12 may not be amended or waived except with the
consent of the Lead Underwriter.

28. Grantee’s Representations. In the event the Shares purchasable pursuant to
this Agreement have not been registered under the Securities Act of 1933, as
amended, at the time of purchase, the Grantee shall, if required by the Company,
concurrently with the purchase of the Shares, deliver to the Company his or her
Investment Representation Statement in the form attached hereto as Exhibit C.

29. Transferability. No benefit payable under, or interest in, this Agreement or
in the shares of Common Stock that are scheduled to be issued hereunder shall be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance or charge and any such attempted action shall be void and no
such benefit or interest shall be, in any manner, liable for, or subject to,
your or your beneficiary’s debts, contracts, liabilities or torts; provided,
however, nothing in this Section 14 shall prevent transfer (i) by will, (ii) by
applicable laws of descent and distribution or (iii) to an Alternate Payee to
the extent that a QDRO so provides, as further described in Section 20 of the
Plan.

30. No Contract for Employment. This Agreement is not an employment or service
contract and nothing in this Agreement shall be deemed to create in any way
whatsoever any obligation of the Grantee to continue in the employ or service of
the Company, or of the Company to continue to employ Grantee.

31. Applicability of Plan. This Agreement is subject to all the provisions of
the Plan, which provisions are hereby made a part of this Agreement, and is
further subject to all interpretations, amendments, rules and regulations which
may from time to time be promulgated and adopted pursuant to the Plan. In the
event of any conflict between the provisions of this Agreement and those of the
Plan, the provisions of the Plan shall control.

32. No Compensation Deferral. This Award is not intended to constitute
“nonqualified deferred compensation” within the meaning of Code Section 409A,
but rather is intended to be exempt from the application of Code Section 409A.
To the extent that the Award is nevertheless deemed to be subject to Code
Section 409A for any reason, this Award shall be interpreted in accordance with
Code Section 409A and Department of Treasury regulations and other interpretive
guidance issued thereunder, including without limitation any such regulations or
other guidance that may be issued after the Grant Date. Notwithstanding any
provision herein to the contrary, in the event that following the Grant Date,
the Administrator (as defined in the Plan) determines that the Award may be or
become subject to Code Section 409A, the Administrator may adopt such amendments
to the Plan and/or this Agreement or adopt other policies and procedures
(including amendments, policies and procedures with retroactive effect), or take
any other actions, that the Administrator determines are necessary or
appropriate to (a) exempt the Plan and/or the Award from the application of Code
Section 409A and/or preserve the intended tax treatment of the benefits provided
with respect to this option, or (b) comply with the requirements of Code
Section 409A. Any such action may include, but is not limited to, delaying
payment, to the extent required in order to avoid accelerated taxation and/or
tax penalties under Code Section 409A, to a Grantee who is a “specified
employee” within the meaning of Code Section 409A to the first day following the
six-month period (or, if earlier, the date of the Grantee’s death) on the date
of the Grantee’s “separation of service” as defined in Code Section 409A. The
Company shall use commercially reasonable efforts to implement the provisions of
this Section 17 in good faith; provided that neither the Company, the
Administrator nor any Employee, Director or representative of the Company or of
any of its Affiliates shall have any liability to Grantee with respect to this
Section 17.

33. Acknowledgement. By electing to accept this Agreement, you acknowledge
receipt of this Agreement and hereby confirm your understanding that the terms
set forth in this Agreement constitute, subject to the terms of the Plan, which
terms shall control in the event of any conflict between the Plan and this
Agreement, the entire agreement and understanding of the parties with respect to
the matters contained herein and supersede any and all prior agreements,
arrangements and understandings, both oral and written, between the parties
concerning the subject matter of this Agreement. The Company may, in its sole
discretion, decide to deliver any documents related to Awards awarded under the
Plan or future Awards that may be awarded under the Plan by electronic means or
request your consent to participate in the Plan by electronic means. You hereby
consent to receive such documents by electronic delivery and agree to
participate in the Plan through an on-line or electronic system established and
maintained by the Company or another third party designated by the Company.

 

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34. Entire Agreement: Governing Law. The Notice, the Plan and this Agreement
constitute the entire agreement of the parties with respect to the subject
matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and the Grantee with respect to the subject matter
hereof, and may not be modified adversely to the Grantee’s interest except by
means of a writing signed by the Company and the Grantee. These agreements are
to be construed in accordance with and governed by the internal laws of the
State of Colorado, without giving effect to any choice of law rule that would
cause the application of the laws of any jurisdiction other than the internal
laws of the State of Colorado to the rights and duties of the parties. Should
any provision of the Notice or this Agreement be determined by a court of law to
be illegal or unenforceable, the other provisions shall nevertheless remain
effective and shall remain enforceable.

35. Headings. The captions used in this Agreement are inserted for convenience
and shall not be deemed a part of this Agreement for construction or
interpretation.

36. Dispute Resolution The provisions of this Section 21 shall be the exclusive
means of resolving disputes arising out of or relating to the Notice, the Plan
and this Agreement. The Company, the Grantee, and the Grantee’s assignees (the
“parties”) shall attempt in good faith to resolve any disputes arising out of or
relating to the Notice, the Plan and this Agreement by negotiation between
individuals who have authority to settle the controversy. Negotiations shall be
commenced by either party by notice of a written statement of the party’s
position and the name and title of the individual who will represent the party.
Within thirty (30) days of the written notification, the parties shall meet at a
mutually acceptable time and place, and thereafter as often as they reasonably
deem necessary, to resolve the dispute. If the dispute has not been resolved by
negotiation, the parties agree that any suit, action, or proceeding arising out
of or relating to the Notice, the Plan or this Agreement shall be brought in the
Courts of the State of Colorado, and the parties shall submit to the
jurisdiction of such courts. The parties irrevocably waive, to the fullest
extent permitted by law, any objection the party may have to the laying of venue
for any such suit, action or proceeding brought in such court. THE PARTIES ALSO
EXPRESSLY WAIVE ANY RIGHT THEY HAVE OR MAY HAVE TO A JURY TRIAL OF ANY SUCH
SUIT, ACTION OR PROCEEDING. If any one or more provisions of this Section 21
shall for any reason be held invalid or unenforceable, it is the specific intent
of the parties that such provisions shall be modified to the minimum extent
necessary to make it or its application valid and enforceable.

37. Compliance with Laws. Notwithstanding anything contained in this Agreement
or the Plan, the Company may not take any actions hereunder, and no award shall
be granted, that would violate the Securities Act of 1933, as amended (the
“Act”), the Securities Exchange Act of 1934, as amended, the Code, or any other
securities or tax or other applicable law or regulation. Notwithstanding
anything to the contrary contained herein, the shares issuable upon vesting
shall not be issued unless such shares are then registered under the Act, or, if
such shares are not then so registered, the Company has determined that such
vesting and issuance would be exempt from the registration requirements of the
Act.

38. Notices. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery or upon
deposit in the United States mail by certified mail (if the parties are within
the United States) or upon deposit for delivery by an internationally recognized
express mail courier service (for international delivery of notice), with
postage and fees prepaid, addressed to the other party at its address as shown
beneath its signature in the Notice, or to such other address as such party may
designate in writing from time to time to the other party.

[Signature page follows]

 

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Signature of Grantee:

 

 

[Printed Name of Grantee] Date:             ,          ADA-ES, Inc.: By:  

 

[Printed Name and Title of Officer] Date:             ,             

 

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EXHIBIT A

STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE

[Please sign this document but do not date it. The date and information of the
transferee will be completed if and when the shares are assigned.]

FOR VALUE RECEIVED,                                          hereby sells,
assigns and transfers unto                                         ,
                                         (                        ) shares of
the Common Stock of ADA-ES, Inc., a Colorado corporation (the “Company”),
standing in his name on the books of, the Company represented by Certificate
No.          herewith, and does hereby irrevocably constitute and appoint the
Secretary of the Company attorney to transfer the said stock in the books of the
Company with full power of substitution.

DATED:                     

 

 

 

The undersigned spouse of                              joins in this assignment.

Dated:                     

 

 

  (Spouse of                           
                                           )  

 

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EXHIBIT B

ELECTION UNDER SECTION 83(b)

OF THE INTERNAL REVENUE CODE OF 1986

The undersigned taxpayer hereby elects, pursuant to the Internal Revenue Code,
to include in gross income for 20      the amount of any compensation taxable in
connection with the taxpayer’s receipt of the property described below:

 

1. The name, address, taxpayer identification number and taxable year of the
undersigned are:

TAXPAYER’S NAME:

SPOUSE’S NAME:

TAXPAYER’S SOCIAL SECURITY NO.:

SPOUSE’S SOCIAL SECURITY NO.:

TAXABLE YEAR: Calendar Year 20    

ADDRESS:

 

2. The property which is the subject of this election is                  shares
of common stock of ADA-ES, Inc.

 

3. The property was transferred to the undersigned on             , 20    .

 

4. The property is subject to the following restrictions.

 

5. The fair market value of the property at the time of transfer (determined
without regard to any restriction other than a restriction which by its terms
will never lapse) is:

$         per share ×                  shares = $        .

 

6. The undersigned paid $         per share ×                  shares for the
property transferred or a total of $        .

 

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The undersigned has submitted a copy of this statement to the person for whom
the services were performed in connection with the undersigned’s receipt of the
above-described property. The undersigned taxpayer is the person performing the
services in connection with the transfer of said property.

The undersigned will file this election with the Internal Revenue Service office
to which he files his annual income tax return not later than 30 days after the
date of transfer of the property. A copy of the election also will be furnished
to the person for whom the services were performed. Additionally, the
undersigned will include a copy of the election with his income tax return for
the taxable year in which the property is transferred. The undersigned
understands that this election will also be effective as an election under
                     law.

 

Dated:  

 

     

 

        Taxpayer The undersigned spouse of taxpayer joins in this election.    
  Dated:  

 

     

 

        Spouse of Taxpayer

 

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EXHIBIT C

ADA-ES, INC. AMENDED AND RESTATED 2007 EQUITY INCENTIVE PLAN

INVESTMENT REPRESENTATION STATEMENT

 

GRANTEE     :    

 

COMPANY     :     ADA-ES, INC. SECURITY     :     COMMON STOCK AMOUNT     :    

 

DATE     :    

 

In connection with the purchase of the above-listed securities (the “Shares”),
the undersigned Grantee represents to the Company the following:

(a) Grantee is aware of the Company’s business affairs and financial condition
and has acquired sufficient information about the Company to reach an informed
and knowledgeable decision to acquire the Shares. Grantee is acquiring these
Shares for investment for Grantee’s own account only and not with a view to, or
for resale in connection with, any “distribution” thereof within the meaning of
the Securities Act of 1933, as amended (the “Securities Act”).

(b) Grantee acknowledges and understands that the Shares constitute “restricted
securities” under the Securities Act and have not been registered under the
Securities Act in reliance upon a specific exemption therefrom, which exemption
depends upon among other things, the bona fide nature of Grantee’s investment
intent as expressed herein. In this connection, Grantee understands that, in the
view of the Securities and Exchange Commission, the statutory basis for such
exemption may be unavailable if Grantee’s representation was predicated solely
upon a present intention to hold these Shares for the minimum capital gains
period specified under tax statutes, for a deferred sale, for or until an
increase or decrease in the market price of the Shares, or for a period of one
year or any other fixed period in the future. Grantee further understands that
the Shares must be held indefinitely unless they are subsequently registered
under the Securities Act or an exemption from such registration is available.
Grantee further acknowledges and understands that the Company is under no
obligation to register the Shares. Grantee understands that the certificate
evidencing the Shares will be imprinted with a legend which prohibits the
transfer of the Shares unless they are registered or such registration is not
required in the opinion of counsel satisfactory to the Company.

(c) Grantee is familiar with the provisions of Rule 144 promulgated under the
Securities Act, which, in substance, permit limited public resale of “restricted
securities” acquired, directly or indirectly from the issuer thereof, in a
non-public offering subject to the satisfaction of certain conditions. Subject
to the availability of certain public information about the Company, Grantee may
resell the Shares pursuant to Rule 144 if Grantee is not an affiliate of the
Company and has not been an affiliate for the preceding three months. If Grantee
is or has been an affiliate of the Company in the preceding three months,
Grantee may resell the Shares pursuant to Rule 144 subject to the satisfaction
of certain conditions specified in the rule, including: (1) the resale being
made through a broker in an unsolicited “broker’s transaction” or in
transactions directly with a market maker (as said term is defined under the
Securities Exchange Act of 1934, as amended), (2) the availability of certain
public information about the Company, (3) the amount of Shares being sold during
any three month period not exceeding the limitations specified in Rule 144(e),
and (4) the timely filing of a Form 144, if applicable. The resale must occur
not less than six months after the later of the date the Shares were sold by the
Company or the date the Shares were sold by an affiliate of the

 

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Company (within the meaning of Rule 144). Other restrictions may also apply to
sales of the Shares, and Grantee understands that the Shares may not be readily
resold, and that delays may occur in selling the Shares even if they are
eligible for sale under Rule 144.

(d) Grantee further understands that in the event all of the applicable
requirements of Rule 144 are not satisfied, registration under the Securities
Act, compliance with Regulation A, or some other registration exemption will be
required; and that, notwithstanding the fact that Rule 144 is not exclusive, the
Staff of the Securities and Exchange Commission has expressed its opinion that
persons proposing to sell private placement securities other than in a
registered offering and otherwise than pursuant to Rule 144 will have a
substantial burden of proof in establishing that an exemption from registration
is available for such offers or sales, and that such persons and their
respective brokers who participate in such transactions do so at their own risk.
Grantee understands that no assurances can be given that any such other
registration exemption will be available in such event, and that the Shares may
not be salable by Grantee.

(e) Grantee represents that he is a resident of the State of
                            .

 

Signature of Grantee:

 

 

[Print Name] Date:  

 

ADA-ES, INC. By:  

 

Title:  

 

 

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