Exhibit 10.1





Exhibit 10.1




NEITHER THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON EXERCISE OF THESE SECURITIES HAVE BEEN
REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN
RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR
TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THESE
SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF THESE SECURITIES MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT SECURED BY SUCH SECURITIES.



CLEAN DIESEL TECHNOLOGIES, INC.




FORM OF WARRANT




			
	 	 	 
	Warrant No. [___]
	 	Original Issue Date:
 _____, 2011






Clean Diesel Technologies, Inc., a Delaware corporation (the “Company”), hereby certifies
that, as partial compensation for services, [_____] or its registered assigns (the “Holder”), is
entitled to purchase from the Company up to a total of [2% of the offered securities] shares of
Common Stock (each such share, a “Warrant Share” and all such shares, the “Warrant Shares”), at any
time and from time to time from and after the Original Issue Date and through and including
 _____, 2016 (the “Expiration Date”) (provided that any Warrant Shares issued prior to the
180th day following effectiveness of the Registration Statement on Form S-1 (333-174680)
(the “Registration Statement”) shall remain subject to the lock-up restrictions in FINRA Rule
5110(g)(1)), and subject to the following terms and conditions:



1. Definitions. As used in this Warrant, the following terms shall have the
respective definitions set forth in this Section 1.



“Affiliate” means any Person that, directly or indirectly through one or more intermediaries,
controls or is controlled by or is under common control with a Person, as such terms are used in
and construed under Rule 144.



“Business Day” means any day except Saturday, Sunday and any day which is a federal legal
holiday or a day on which banking institutions in the State of New York are authorized or required
by law or other governmental action to close.


 


 









 





“Common Stock” means the common stock of the Company, $0.01 par value per share, and any
securities into which such common stock may hereafter be reclassified or for which it may be
exchanged as a class.




“Exchange Act” means the Securities Exchange Act of 1934, as amended.



“Exercise Price” means $[120% of price to public], subject to adjustment in accordance with
Section 9.



“Fundamental Transaction” means any of the following: (1) the Company effects any merger or
consolidation of the Company with or into another Person, (2) the Company effects any sale of all
or substantially all of its assets in one or a series of related transactions, (3) any tender offer
or exchange offer (whether by the Company or another Person) is completed pursuant to which holders
of Common Stock are permitted to tender or exchange their shares for other securities, cash or
property, or (4) the Company effects any reclassification of the Common Stock or any compulsory
share exchange pursuant to which the Common Stock is effectively converted into or exchanged for
other securities, cash or property.



“New York Courts” means the state and federal courts sitting in the City of New York, Borough
of Manhattan.



“Original Issue Date” means the Original Issue Date first set forth on the first page of this
Warrant.



“Person” means an individual or corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability company, joint stock company,
government (or an agency or subdivision thereof) or other entity of any kind.



“Rule 144” means Rule 144 promulgated by the SEC pursuant to the Securities Act, as such Rule
may be amended from time to time, or any similar rule or regulation hereafter adopted by the SEC on
having substantially the same effect as such Rule.




“SEC” means the Securities and Exchange Commission.




“Securities Act” means the Securities Act of 1933, as amended.



“Subsidiary” means any “significant subsidiary” as defined in Rule 1-02(w) of Regulation S-X
promulgated by the SEC under the Exchange Act.



“Trading Day” means (i) a day on which the Common Stock is traded or quoted on a Trading
Market, or (ii) if the Common Stock is not traded or quoted on any Trading Market, a day on which
the Common Stock is quoted in the over-the-counter market as reported by the Pink Sheets LLC (or
any similar organization or agency succeeding to its functions of reporting prices); provided, that
in the event that the Common Stock is not traded or quoted as set forth in (i) or (ii) hereof, then
Trading Day shall mean a Business Day.


 


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“Trading Market” means whichever of the New York Stock Exchange, NYSE Amex Equities, the
NASDAQ Global Select Market, the NASDAQ Global Market, the NASDAQ Capital Market or OTC Bulletin
Board on which the Common Stock is listed or quoted for trading on the date in question.




“Warrant Shares” means the shares of Common Stock issuable upon exercise of this Warrant.



2. Registration of Warrant. The Company shall register this Warrant upon records to
be maintained by the Company for that purpose (the “Warrant Register”), in the name of the record
Holder hereof from time to time. The Company may deem and treat the registered Holder of this
Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to
the Holder, and for all other purposes, absent actual notice to the contrary.



3. Registration of Transfers. Subject to the limitation set forth in the last
sentence of Section 4 hereof, the Company shall register the transfer of any portion of this
Warrant in the Warrant Register, upon surrender of this Warrant, with the Form of Assignment
attached hereto duly completed and signed, to the Company at its address specified herein. Upon
any such registration or transfer, a new Warrant to purchase Common Stock, in substantially the
form of this Warrant (any such new Warrant, a “New Warrant”), evidencing the portion of this
Warrant so transferred shall be issued to the transferee and a New Warrant evidencing the remaining
portion of this Warrant not so transferred, if any, shall be issued to the transferring Holder. The
acceptance of the New Warrant by the transferee thereof shall be deemed the acceptance by such
transferee of all of the rights and obligations of a holder of a Warrant.



4. Exercise and Duration of Warrants. This Warrant shall be exercisable by the
registered Holder at any time and from time to time from and after the Original Issue Date
(provided that any Warrant Shares issued prior to the 180th day following the
effectiveness of the Registration Statement shall remain subject to the lock-up restrictions in
FINRA Rule 5110(g)(1)) through and including the Expiration Date. At 6:30 p.m., New York City time
on the Expiration Date which in accordance with FINRA Rule 5110(f)(2)(H) shall not be more than
five (5) years from the effectiveness of the Registration Statement, the portion of this Warrant
not exercised prior thereto shall be and become void and of no value. The Company may not call or
redeem any portion of this Warrant without the prior written consent of the affected Holder. This
Warrant shall not be sold, transferred, assigned, pledged, or hypothecated, or be the subject of
any hedging, short sale, derivative, put, or call transaction that would result in the effective
economic disposition of this Warrant by any person for a period of 180 days immediately following
the effective date of the Registration Statement, except as provided in FINRA Rule 5110(g)(2).




 


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5. Delivery of Warrant Shares.



(a) To effect exercises hereunder, the Holder shall not be required to physically surrender
this Warrant unless the aggregate Warrant Shares represented by this Warrant is being exercised.
Upon delivery of the Exercise Notice (in the form attached hereto) to the Company (with the
attached Warrant Shares Exercise Log) at its address for notice set

forth herein and upon payment of the Exercise Price multiplied by the number of Warrant Shares
that the Holder intends to purchase hereunder (provided, that, in lieu of the payment of
the Exercise Price, the Holder may have notified the Company in its Exercise Notice that such
exercise was made pursuant to a Cashless Exercise (as defined in Section 11 hereof)), the Company
shall promptly (but in no event later than five Trading Days) after the Date of Exercise (as
defined herein)) issue and deliver to the Holder, a certificate for the Warrant Shares issuable
upon such exercise. The Company shall, upon request of the Holder and subsequent to the date on
which a registration statement covering the resale of the Warrant Shares, if any, has been declared
effective by the SEC, use its reasonable best efforts to deliver Warrant Shares hereunder
electronically through the Depository Trust Corporation or another established clearing corporation
performing similar functions, if available, provided, that, the Company may, but will not
be required to change its transfer agent if its current transfer agent cannot deliver Warrant
Shares electronically through the Depository Trust Corporation. A “Date of Exercise” means the
date on which the Holder shall have delivered to the Company: (i) the Exercise Notice (with the
Warrant Exercise Log attached to it), appropriately completed and duly signed and (ii) payment of
the Exercise Price for the number of Warrant Shares so indicated by the Holder to be purchased.



(b) If by the fifth Trading Day after a Date of Exercise the Company fails to deliver the
required number of Warrant Shares in the manner required pursuant to Section 5(a), then the Holder
will have the right to rescind such exercise.



(c) The Company’s obligations to issue and deliver Warrant Shares in accordance with the terms
hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to
enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any
judgment against any Person or any action to enforce the same, or any setoff, counterclaim,
recoupment, limitation or termination, or any breach or alleged breach by the Holder or any other
Person of any obligation to the Company or any violation or alleged violation of law by the Holder
or any other Person, and irrespective of any other circumstance which might otherwise limit such
obligation of the Company to the Holder in connection with the issuance of Warrant Shares. Nothing
herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law
or in equity including, without limitation, a decree of specific performance and/or injunctive
relief with respect to the Company’s failure to timely deliver certificates representing Warrant
Shares upon exercise of the Warrant as required pursuant to the terms hereof.



6. Charges, Taxes and Expenses. Issuance and delivery of Warrant Shares upon exercise
of this Warrant shall be made without charge to the Holder for any issue or transfer tax,
withholding tax, transfer agent fee or other incidental tax or expense in respect of the issuance
of such certificates, all of which taxes and expenses shall be paid by the Company; provided,
however, that the Company shall not be required to pay any tax which may be payable in respect of
any transfer involved in the registration of any certificates for Warrant Shares or Warrants in a
name other than that of the Holder. The Holder shall be responsible for all other tax liability
that may arise as a result of holding or transferring this Warrant or receiving Warrant Shares upon
exercise hereof.


 


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7. Replacement of Warrant. If this Warrant is mutilated, lost, stolen or destroyed,
the Company shall issue or cause to be issued in exchange and substitution for and upon
cancellation hereof, or in lieu of and substitution for this Warrant, a New Warrant, but only upon
receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction and
customary and reasonable indemnity (which shall not include a surety bond), if requested.
Applicants for a New Warrant under such circumstances shall also comply with such other reasonable
regulations and procedures and pay such other reasonable third-party costs as the Company may
prescribe. If a New Warrant is requested as a result of a mutilation of this Warrant, then the
Holder shall deliver such mutilated Warrant to the Company as a condition precedent to the
Company’s obligation to issue the New Warrant.



8. Reservation of Warrant Shares. The Company covenants that it will at all times
reserve and keep available out of the aggregate of its authorized but unissued and otherwise
unreserved Common Stock, solely for the purpose of enabling it to issue Warrant Shares upon
exercise of this Warrant as herein provided, the number of Warrant Shares which are then issuable
and deliverable upon the exercise of this entire Warrant, free from preemptive rights or any other
contingent purchase rights of Persons other than the Holder (taking into account the adjustments
and restrictions of Section 9). The Company covenants that all Warrant Shares so issuable and
deliverable shall, upon issuance and the payment of the applicable Exercise Price in accordance
with the terms hereof, be duly and validly authorized, issued and fully paid and nonassessable.



9. Certain Adjustments. The Exercise Price and number of Warrant Shares issuable upon
exercise of this Warrant are subject to adjustment from time to time as set forth in this
Section 9.



(a) Stock Dividends and Splits. If the Company, at any time while this Warrant is
outstanding, (i) pays a stock dividend on its Common Stock or otherwise makes a distribution on any
class of capital stock that is payable in shares of Common Stock, (ii) subdivides outstanding
shares of Common Stock into a larger number of shares, or (iii) combines outstanding shares of
Common Stock into a smaller number of shares, then in each such case the Exercise Price shall be
multiplied by a fraction of which the numerator shall be the number of shares of Common Stock
outstanding immediately before such event and of which the denominator shall be the number of
shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant to
clause (i) of this paragraph shall become effective immediately after the record date for the
determination of stockholders entitled to receive such dividend or distribution, and any adjustment
pursuant to clause (ii) or (iii) of this paragraph shall become effective immediately after the
effective date of such subdivision or combination.



 


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(b) Fundamental Transactions. If, at any time while this Warrant is outstanding there
is a Fundamental Transaction, then the Holder shall have the right thereafter to receive, upon
exercise of this Warrant, the same amount and kind of securities, cash or property as it would have
been entitled to receive upon the occurrence of such Fundamental Transaction if it had been,
immediately prior to such Fundamental Transaction, the holder of the number of Warrant Shares then
issuable upon exercise in full of this Warrant (the “Alternate Consideration”). For purposes of any such exercise, the determination of the Exercise Price
shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of
Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental
Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration
in a reasonable manner reflecting the relative value of any different components of the Alternate
Consideration. If holders of Common Stock are given any choice as to the securities, cash or
property to be received in a Fundamental Transaction, then the Holder shall be given the same
choice as to the Alternate Consideration it receives upon any exercise of this Warrant following
such Fundamental Transaction. At the Holder’s option and request, any successor to the Company or
surviving entity in such Fundamental Transaction shall issue to the Holder a new warrant
substantially in the form of this Warrant and consistent with the foregoing provisions and
evidencing the Holder’s right to purchase the Alternate Consideration for the aggregate Exercise
Price upon exercise thereof. The terms of any agreement pursuant to which a Fundamental
Transaction is effected shall include terms requiring any such successor or surviving entity to
comply with the provisions of this paragraph (b) and insuring that the Warrant (or any such
replacement security) will be similarly adjusted upon any subsequent transaction analogous to a
Fundamental Transaction.



(c) Number of Warrant Shares. Simultaneously with any adjustment to the Exercise
Price pursuant to this Section 9, the number of Warrant Shares that may be purchased upon exercise
of this Warrant shall be increased or decreased proportionately, so that after such adjustment the
aggregate Exercise Price payable hereunder for the adjusted number of Warrant Shares shall be the
same as the aggregate Exercise Price in effect immediately prior to such adjustment.



(d) Calculations. All calculations under this Section 9 shall be made to the nearest
cent or the nearest 1/100th of a share, as applicable. The number of shares of Common
Stock outstanding at any given time shall not include shares owned or held by or for the account of
the Company, and the disposition of any such shares shall be considered an issue or sale of Common
Stock.



(e) Notice of Adjustments. Upon the occurrence of each adjustment pursuant to this
Section 9, the Company at its expense will promptly compute such adjustment in accordance with the
terms of this Warrant and prepare a certificate setting forth such adjustment, including a
statement of the adjusted Exercise Price and adjusted number or type of Warrant Shares or other
securities issuable upon exercise of this Warrant (as applicable), describing the transactions
giving rise to such adjustments and showing in detail the facts upon which such adjustment is
based. Upon written request, the Company will promptly deliver a copy of each such certificate to
the Holder and to the Company’s Transfer Agent.


 


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(f) Notice of Corporate Events. If the Company (i) declares a dividend or any other
distribution of cash, securities or other property in respect of its Common Stock, including
without limitation any granting of rights or warrants to subscribe for or purchase any capital
stock of the Company or any Subsidiary, (ii) authorizes or approves, enters into any agreement
contemplating or solicits stockholder approval for any Fundamental Transaction or (iii)
authorizes the voluntary dissolution, liquidation or winding up of the affairs of the Company,
then the Company shall deliver to the Holder a notice describing the material terms and conditions
of such transaction (but only to the extent such disclosure would not result in the dissemination
of material, non-public information to the Holder) at least 10 calendar days prior to the
applicable record or effective date on which a Person would need to hold Common Stock in order to
participate in or vote with respect to such transaction, and the Company will take all steps
reasonably necessary in order to give the Holder the practical opportunity to exercise this Warrant
prior to such time so as to participate in or vote with respect to such transaction; provided,
however, that the failure to deliver such notice or any defect therein shall not affect the
validity of the corporate action required to be described in such notice.



10. Payment of Exercise Price. The Holder shall pay the Exercise Price by delivering
immediately available funds if the Holder did not notify the Company in the Exercise Notice that
the exercise was made pursuant to a Cashless Exercise as further described in Section 11 hereof.



11. Cashless Exercise. Notwithstanding anything contained herein to the contrary
(other than Section 12 below), the Holder may, in lieu of making the cash payment otherwise
contemplated to be made to the Company upon exercise, elect instead to receive upon such exercise
the “Net Number” of shares of Common Stock determined according to the following formula (a
“Cashless Exercise”):




Net Number = (A x B) - (A x C)


B



For purposes of the foregoing formula:




A = the total number of shares with respect to which this Warrant is then being
exercised.




B = as applicable: (i) the closing sale price of the Common Stock on the Trading Day
immediately preceding the date of the applicable Exercise Notice if such Exercise
Notice is (1) both executed and delivered pursuant to Section 5 hereof on a day that
is not a Trading Day or (2) both executed and delivered pursuant to Section 5 hereof
on a Trading Day prior to the opening of “regular trading hours” (as defined in Rule
600(b)(64) of Regulation NMS promulgated under the federal securities laws) on such
Trading Day, (ii) the bid price of the Common Stock as of the time of the Holder’s
execution of the applicable Exercise Notice if such Exercise Notice is executed
during “regular trading hours” on a Trading Day pursuant to Section 5 hereof, (iii)
the closing sale price of the Common Stock on the date of the applicable Exercise
Notice if the date of such Exercise Notice is a Trading Day and such Exercise Notice
is both executed and delivered pursuant to Section 5 hereof after the close of
“regular trading hours” on such Trading Day, or (iv) if the Common Stock is not
traded in such manner that the quotations referred to above are available, the fair
value per share of the Common Stock as determined by the Board of Directors of the
Company in good faith.




	 	 	C = the Exercise Price then in effect for the applicable Warrant
Shares at the time
of such exercise.




 


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12. Limitations on Exercise. Notwithstanding anything to the contrary contained
herein, the number of Warrant Shares that may be acquired by the Holder upon any exercise of this
Warrant (or otherwise in respect hereof) shall be limited to the extent necessary to insure that,
following such exercise (or other issuance), the total number of shares of Common Stock then
beneficially owned by such Holder and its Affiliates and any other Persons whose beneficial
ownership of Common Stock would be aggregated with the Holder’s for purposes of Section 13(d) of
the Exchange Act, does not exceed 9.99% of the total number of issued and outstanding shares of
Common Stock (including for such purpose the shares of Common Stock issuable upon such exercise).
For such purposes, beneficial ownership shall be determined in accordance with Section 13(d) of the
Exchange Act and the rules and regulations promulgated thereunder. This provision shall not
restrict the number of shares of Common Stock which a Holder may receive or beneficially own in
order to determine the amount of securities or other consideration that such Holder may receive in
the event of a Fundamental Transaction as contemplated in Section 9 of this Warrant. This
restriction may not be waived. Notwithstanding anything to the contrary contained in this Warrant,
(a) no term of this Section may be waived by any party, nor amended such that the threshold
percentage of ownership would be directly or indirectly increased, (b) this restriction runs with
the Warrant and may not be modified or waived by any subsequent holder hereof and (c) any attempted
waiver, modification or amendment of this Section will be void ab initio.



13. No Fractional Shares. No fractional shares of Warrant Shares will be issued in
connection with any exercise of this Warrant. In lieu of any fractional shares which would,
otherwise be issuable, the Company shall pay cash equal to the product of such fraction multiplied
by the closing price of one Warrant Share as reported by the applicable Trading Market on the date
of exercise.



14. Notices. Any and all notices or other communications or deliveries hereunder
(including, without limitation, any Exercise Notice) shall be in writing and shall be deemed given
and effective on the earliest of (i) the date of transmission, if such notice or communication is
delivered via facsimile at the facsimile number specified in this Section prior to 6:30 p.m. (New
York City time) on a Trading Day, (ii) the next Trading Day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number specified in this
Section on a day that is not a Trading Day or later than 6:30 p.m. (New York City time) on any
Trading Day, (iii) the Trading Day following the date of mailing, if sent by nationally recognized
overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required
to be given. The addresses for such communications shall be: (i) if to the Company, to 4567
Telephone Road, Suite 206, Ventura, CA 93033, Attn: Chief Financial Officer, or to Facsimile No.:
(805) 639-9466 (or such other address as the Company shall indicate in writing in accordance with
this Section), or (ii) if to the Holder, to the address or facsimile number appearing on the
Warrant Register or such other address or facsimile number as the Holder may provide to the Company
in accordance with this Section.



15. Warrant Agent. The Company shall serve as warrant agent under this Warrant. Upon
10 days’ notice to the Holder, the Company may appoint a new warrant agent. Any corporation into
which the Company or any new warrant agent may be merged or any corporation resulting from any
consolidation to which the Company or any new warrant agent shall be a party or any corporation to
which the Company or any new warrant agent transfers substantially all of its corporate trust or
shareholders services business shall be a successor warrant agent under this Warrant without any
further act. Any such successor warrant agent shall promptly cause notice of its succession as
warrant agent to be mailed (by first class mail, postage prepaid) to the Holder at the Holder’s
last address as shown on the Warrant Register.


 


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16. Miscellaneous.



(a) This Warrant shall be binding on and inure to the benefit of the parties hereto and their
respective successors and assigns. Subject to the preceding sentence, nothing in this Warrant
shall be construed to give to any Person other than the Company and the Holder any legal or
equitable right, remedy or cause of action under this Warrant. This Warrant may be amended only in
writing signed by the Company and the Holder and their successors and assigns. The foregoing
sentence shall be subject to the restrictions on waivers and amendments set forth in Section 12 of
this Warrant.



(b) All questions concerning the construction, validity, enforcement and interpretation of
this Warrant shall be governed by and construed and enforced in accordance with the internal laws
of the State of New York, without regard to the principles of conflicts of law thereof. Each party
agrees that all legal proceedings concerning the interpretations, enforcement and defense of this
Warrant and the transactions herein contemplated (“Proceedings”) (whether brought against a party
hereto or its respective Affiliates, employees or agents) shall be commenced exclusively in the New
York Courts. Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New
York Courts for the adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not
to assert in any Proceeding, any claim that it is not personally subject to the jurisdiction of any
New York Court, or that such Proceeding has been commenced in an improper or inconvenient forum.
Each party hereto hereby irrevocably waives personal service of process and consents to process
being served in any such Proceeding by mailing a copy thereof via registered or certified mail or
overnight delivery (with evidence of delivery) to such party at the address in effect for notices
to it under this Warrant and agrees that such service shall constitute good and sufficient service
of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any
right to serve process in any manner permitted by law. Each party hereto hereby irrevocably
waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in
any legal proceeding arising out of or relating to this Warrant or the transactions contemplated
hereby. If either party shall commence a Proceeding to enforce any provisions of this Warrant,
then the prevailing party in such Proceeding shall be reimbursed by the other party for its
attorney’s fees and other costs and expenses incurred with the investigation, preparation and
prosecution of such Proceeding.



(c) The headings herein are for convenience only, do not constitute a part of this Warrant and
shall not be deemed to limit or affect any of the provisions hereof.



(d) In case any one or more of the provisions of this Warrant shall be invalid or
unenforceable in any respect, the validity and enforceability of the remaining terms and provisions
of this Warrant shall not in any way be affected or impaired thereby and the parties will attempt
in good faith to agree upon a valid and enforceable provision which shall be a commercially
reasonable substitute therefor, and upon so agreeing, shall incorporate such substitute provision
in this Warrant.



(e) Prior to exercise of this Warrant, the Holder hereof shall not, by reason of being a
Holder, be entitled to any rights of a stockholder with respect to the Warrant Shares.



[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK,

SIGNATURE PAGE FOLLOWS]


 


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IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its authorized
officer as of the date first indicated above.



	 	 	 	 	 	 	 
	 	 	CLEAN DIESEL TECHNOLOGIES, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 






[Signature Page to Warrant]




 


 









 







EXERCISE NOTICE

CLEAN DIESEL TECHNOLOGIES, INC.

WARRANT DATED ________




The undersigned Holder hereby irrevocably elects to purchase
 _____ 
shares of Common Stock
pursuant to the above referenced Warrant. Capitalized terms used herein and not otherwise defined
have the respective meanings set forth in the Warrant.




	(1)	 	The undersigned Holder hereby exercises its right to purchase
 _____ 
Warrant
Shares pursuant to the Warrant.

	 
	(2)	 	The holder intends that payment of the Exercise Price shall be made as:







	 	 	
 _____ 
a “Cash Exercise” with respect to
 _____ 
Warrant Shares;
and/or

	 
	 	 	
 _____ 
a “Cashless Exercise” with respect to
 _____ 
Warrant Shares.







	(3)	 	Pursuant to this Exercise Notice, the Company shall deliver to the holder
 _____ 

Warrant Shares in accordance with the terms of the Warrant.







	(4)	 	By its delivery of this Exercise Notice, the undersigned represents and warrants to the
Company that in giving effect to the exercise evidenced hereby the Holder will not
beneficially own in excess of the number of shares of Common Stock (determined in accordance
with Section 13(d) of the Securities Exchange Act of 1934) permitted to be owned under Section
12 of this Warrant to which this notice relates.






	 	 	 	 	 	 	 
	Dated:                                         , ______	 	Name of Holder:	 	 
	 
	 	 	 	 
	 
	 	(Print)	 	 	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	(Signature must conform in all respects to name of holder as specified on the face of the Warrant)





 


 









 





Warrant Shares Exercise Log




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Number of	 
	 	 	Number of Warrant	 	 	Number of Warrant	 	 	Warrant Shares	 
	 	 	Shares Available to be	 	 	Shares	 	 	Remaining to	 
	Date	 	Exercised	 	 	Exercised	 	 	be Exercised	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 





 


 









 





CLEAN DIESEL TECHNOLOGIES, INC.

WARRANT DATED ________

WARRANT NO. [___]




FORM OF ASSIGNMENT





[To be completed and signed only upon transfer of Warrant]



FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto

 _____ 
the right represented by the above-captioned Warrant to purchase

 _____ 
shares of Common Stock to which such Warrant relates and appoints
 _____ 

attorney to transfer said right on the books of the Company with full power of substitution in the
premises.



Dated: _______________, ____




	 	 	 	 	 
	 

	 	 

(Signature must conform in all respects to name of
holder as specified on the face of the Warrant)
	 	 
	 
	 	 	 	 
	 

	 	 

Address of Transferee
	 	 
	 
	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	 

	 	 

	 	 






In the presence of: