Document:

Form of Independent Director Stock Option Agreement

     

    EXHIBIT
      10.1

    H2DIESEL
      HOLDINGS, INC.

    

    Form
      of Independent Director Stock Option Agreement

     

    1. Grant
      of Option.
      In
      accordance with and subject to the terms and conditions of this Stock Option
      Agreement (the “Agreement”),
      H2Diesel Holdings, Inc., a Florida corporation (the “Corporation”
which
      term shall include any entity which acquires, through merger, share exchange,
      purchase of assets or otherwise, substantially all of the capital stock or
      assets of the Corporation), grants to the person identified on Schedule
      1
      attached
      hereto (the “Optionee”)
      a
      nonqualified stock option (the “Option”)
      to
      purchase the number of shares (the “Option
      Shares”)
      of its
      Common Stock, par value $.001 per share (“Common
      Stock”),
      set
      forth on Schedule
      1,
      at the
      initial option exercise price set forth in Schedule
      1
      (such
      price, as it may be adjusted hereunder from time to time, the “Exercise
      Price”).

     

    2. Acceptance
      by Optionee.
      The
      exercise of the Option or any portion thereof is conditioned upon acceptance
      by
      the Optionee of the terms and conditions of this Agreement, as evidenced by
      the
      Optionee’s execution of Schedule
      1
      to this
      Agreement and the delivery of an executed copy of this Agreement to the
      Corporation.

     

    3. Vesting
      of Option.
      The
      Option shall vest and be exercisable as set forth in Schedule
      1.

     

    4. Expiration
      of Option.
      The
      Option shall expire on the expiration date set forth in
      Schedule 1
      (the
“Expiration
      Date”)
      and
      may not be exercised after such date.

     

    5. Conditions
      to Exercise of Option.
      The
      Optionee may exercise the Option or any portion thereof to the extent then
      vested at any time or from time to time during the period commencing on the
      Grant Date set forth on Schedule
      1
      and
      ending on the Expiration Date (the “Option
      Term”).
      The
      Option may be exercised only by the Optionee or, in the event of his death
      or
      incompetence, his personal representative or heirs, as the case may
      be.

     

    6. Procedure
      for Exercise.
      (a) The
      vested portion of the Option may be exercised for the number of Option Shares
      specified in a written notice delivered to the Corporation at least five days
      prior to the date on which purchase is requested (such notice, an “Exercise
      Notice”),
      accompanied by full payment in cash of the aggregate Exercise Price in respect
      of such Option Shares. If specified in the Exercise Notice, payment of such
      Exercise Price may also be made by means of the Corporation retaining from
      the
      Option Shares to be delivered upon exercise of the Option, or portion thereof,
      that number of Option Shares having an aggregate Fair Market Value (as defined
      below) on the date that the Exercise Notice is delivered to the Corporation
      (the
      date that the Exercise Notice is delivered to the Corporation being referred
      to
      as the “Valuation
      Date”;
      provided, however
      , that
      if such date is not a day on which securities markets are open for trading,
      then
      the Valuation Date shall be the first succeeding date that such markets are
      open) equal to the aggregate Exercise Price of the total number of Option Shares
      with respect to which the Optionee shall then be exercising the Option. If
      upon
      exercise of all or a portion of the Option there shall be payable by the
      Corporation or a subsidiary any amount for withholding taxes, then, at the
      Corporation’s election and as a condition to such exercise, either (i) the
      Corporation shall reduce the number of Option Shares to be issued to the
      Optionee by a number of Option Shares of Common Stock having an aggregate Fair
      Market Value on the Valuation Date equal to the amount of such withholding
      tax
      or (ii) the Optionee shall pay such amount to the Corporation or its subsidiary,
      as applicable.

     

    (b)
      If
      any applicable law requires the Corporation to take any action with respect
      to
      the Option Shares specified in the Exercise Notice, or if any action remains
      to
      be taken under the Certificate of Incorporation or Bylaws of the Corporation,
      as
      in effect at the time, to effect due issuance of Option Shares, then the
      Corporation shall take such action and the day for delivery of such Option
      Shares shall be extended for the period necessary to take such action. The
      Optionee shall not have any of the rights of a shareholder of the Corporation
      under the Option.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    (c)
      As
      used herein, the phrase “Fair Market Value” shall mean (i) if the Common
      Stock is listed or admitted for trading on a national securities exchange,
      an
      automated quotation system or the Over-the-Counter Bulletin Board, the last
      reported sale price per share of the Common Stock on the Valuation Date, or,
      in
      case no such reported sale takes place on such day or is reported, then the
      average of the last reported per share bid and ask prices for shares of the
      Common Stock on such date (or if such bid and ask prices are not available
      on
      such date, the most recent preceding date), in either case as officially
      reported by such securities exchange, quotation system or Bulletin Board on
      which the Common Stock is listed or admitted to trading, (ii) if not so
      listed or admitted for trading, the fair market value of a share of the Common
      Stock as determined by the Corporation’s board of directors in good faith, or
      (iii) if such exercise is in connection with a merger or consolidation of the
      Corporation in which the Corporation is not the survivor or in which the Common
      Stock is exchanged for cash or other securities or a sale of all or
      substantially all of the assets of the Corporation (collectively, a
“Sale”),
      the
      implied price per share of the Common Stock resulting from such
      Sale.

     

    7. Adjustment
      of Exercise Price and Option Shares. (a)
      If,
      at any time prior to the Expiration Date, the number of outstanding shares
      of
      Common Stock is (i) increased by a stock dividend payable in shares of Common
      Stock or by a subdivision or split-up of shares of Common Stock, or (ii)
      decreased by a combination of shares of Common Stock, then, following the record
      date fixed for the determination of holders of Common Stock entitled to receive
      the benefits of such stock dividend, subdivision, split-up, or combination,
      the
      Exercise Price shall be adjusted to a new amount equal to the product of (A)
      the
      Exercise Price in effect on such record date, and (B) the quotient obtained
      by
      dividing (x) the number of Option Shares for which the Option was exercisable
      on
      such record date without giving effect to the event referred to in the foregoing
      clause (i) or (ii) (such number of Option Shares, the “Record
      Date Option Shares”),
      by
      (y) the aggregate number of shares to which the Record Date Option Shares would
      have been increased or decreased immediately after and as a result of the event
      referred to in the foregoing clause (i) or (ii) had the Record Date Option
      Shares been issued immediately prior to such record date.

     

    (b) Upon
      each adjustment of the Exercise Price as provided in
      Section 8(a),
      the
      Optionee shall thereafter be entitled to subscribe for and purchase, at the
      Exercise Price resulting from such adjustment, the number of Option Shares
      equal
      to the product of (i) the number of Record Date Option Shares and (ii) the
      quotient obtained by dividing (A) the Exercise Price existing prior to such
      adjustment by (B) the new Exercise Price resulting from such
      adjustment.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    8. Reclassification,
      Etc. In
      case
      of any reclassification or change of the outstanding Common Stock of the
      Corporation (other than as a result of a subdivision, combination or stock
      dividend), or in case of any consolidation of the Corporation with, or merger
      of
      the Corporation into, another corporation or other business organization (other
      than a consolidation or merger in which the Corporation is the continuing
      corporation and which does not result in any reclassification or change of
      the
      outstanding Common Stock of the Corporation) at any time prior to the Expiration
      Date, then, as a condition of such reclassification, reorganization, change,
      consolidation or merger, lawful provision shall be made, and duly executed
      documents evidencing the same from the Corporation or its successor shall be
      delivered to the Optionee, so that the Optionee shall have the right prior
      to
      the Expiration Date to purchase, at a total price not to exceed that payable
      upon the exercise of this Option as to the number of Option Shares is then
      exercisable, the kind and amount of shares of stock and other securities and
      property receivable upon such reclassification, reorganization, change,
      consolidation or merger by a holder of the number of Option Shares which might
      have been purchased by the Optionee immediately prior to such reclassification,
      reorganization, change, consolidation or merger, and in any such case
      appropriate provisions shall be made with respect to the rights and interest
      of
      the Optionee to the end that the provisions hereof (including provisions for
      the
      adjustment of the Exercise Price and of the number of shares purchasable upon
      exercise of the Option) shall thereafter be applicable in relation to any shares
      of stock and other securities and property thereafter deliverable upon exercise
      of the Option.

     

    9. Non-Transferability
      of Stock Options.
      The
      Option granted hereunder to the Optionee shall not be transferable by the
      Optionee otherwise than by will, or by the laws of descent and
      distribution.

     

    10. Compliance
      With Applicable Law.
      The
      issuance of the Option Shares pursuant to the exercise of the Option is subject
      to compliance with all applicable laws, including without limitation laws
      governing withholding from employees and nonresident aliens for income tax
      purposes. 

     

    11. Representations;
      Restrictions on Option Shares.
      Unless a
      current registration statement under the Securities Act shall be in effect
      with
      respect to the Option Shares to be issued upon exercise of the Option, the
      Optionee, by accepting the Option, covenants and agrees that, at the time of
      exercise the Option, the Optionee will deliver to the Corporation such written
      representations that the Company may deem necessary or appropriate to ensure
      that the Option Shares are not required to be registered under the Securities
      Act or applicable state securities laws. The Optionee agrees that certificates
      representing Option Shares may bear a legend substantially as
      follows:

    

     

    THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS.
      THESE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR TRANSFERRED UNTIL THE
      HOLDER HEREOF PROVIDES EVIDENCE SATISFACTORY TO THE ISSUER (WHICH, IN THE
      DISCRETION OF THE ISSUER, MAY INCLUDE AN OPINION OF COUNSEL SATISFACTORY TO
      THE
      ISSUER) THAT SUCH OFFER, SALE, PLEDGE, TRANSFER OR OTHER DISPOSITION WILL NOT
      VIOLATE APPLICABLE FEDERAL OR STATE LAWS.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    12. Notices
      Generally. Any

      notice, request, consent, other communication or delivery pursuant to the
      provisions hereof shall be in writing and shall be sent by one of the following
      means: (i) by registered or certified first class mail, postage prepaid, return
      receipt requested; (ii) by facsimile transmission with confirmation of receipt;
      (iii) by overnight courier service; or (iv) by personal delivery, and shall
      be
      properly addressed to the Optionee at the last known address or facsimile number
      appearing on the books of the Corporation, or, except as herein otherwise
      expressly provided, to the Corporation at its principal executive office
      Attention: Chief Executive Officer, or such other address or facsimile number
      as
      shall have been furnished to the party giving or making such notice, demand
      or
      delivery.

     

    13. Miscellaneous.

     

    (a) This
      Agreement has been duly authorized on behalf of the Corporation by the Board.
      The Optionee represents that he is free to enter into this Agreement and that
      his entering into this Agreement does not violate any obligation that he has
      to
      any other person or legal entity.

     

    (b) In
      the event that any provision of this Agreement would be held to be invalid
      or
      unenforceable for any reason unless narrowed by construction, this Agreement
      shall be construed as if such invalid or unenforceable provision had been more
      narrowly drawn so as not to be invalid or unenforceable. If, notwithstanding
      the
      foregoing, any provision of this Agreement shall be held to be invalid or
      unenforceable for any reason, such invalidity or unenforceability shall attach
      only to such provision and shall not affect or render invalid or unenforceable
      any other provision of this Agreement.

     

    (c)
      This
      Agreement sets forth the entire understanding of the Corporation and the
      Optionee with respect to the subject matter hereof and cannot be amended or
      modified except by a writing signed by both parties.

     

    (d) Except
      as otherwise expressly provided herein, this Agreement shall be binding upon
      and
      inure to the benefit of the parties hereto, and their respective permitted
      successors and assigns, heirs and personal representatives.

     

    (d) This
      Agreement shall be interpreted, construed and administered in accordance with
      the laws of the State of Florida without regard to its choice of law provisions
      that would cause the laws of another jurisdiction to apply.

     

    (e) This
      Agreement may be executed in counterparts which, taken together, shall
      constitute a single original document.

     

    

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF,
      the
      Corporation has caused this Agreement to be executed as of the Date of Grant
      set
      forth in Schedule 1.

     

    

    H2DIESEL
      HOLDINGS, INC.

    

    

    

    By:    ______________________________

    Name:
      

    Title: 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    

    Schedule
      1

    Stock
      Option Agreement

     

    
      	
              1.
                Name of Optionee:

            	 
	
              2.
                Number of Option Shares:

            	 
	
              3.
                Option Exercise Price Per Share:

            	 
	
              4.
                Date of Grant:

            	 
	
              5.
                Expiration Date:

            	 
	
              6.
                Vesting Schedule:

            	 

    

     

     

     

    

     

    Accepted
      and agreed to as of the date first above written:

     

    

    

    

    _______________________

    [Independent
      Director]Exhibit 4.1 Specimen Common Stock Certificate

    
      

    

    Exhibit
      4.1

    Specimen
      Common Stock Certificate

    

    

    

    

     

    INCORPORATED
      UNDER THE LAWS OF THE STATE OF NEVADA

     

    
      	
               

              Number

               

            	 	
               

              Shares

               

            
	 	 	 

    

     

    

     

     

    SMART
      HOLDINGS, INC.

     

     

    

     

     

    The
      Corporation is authorized to issue 100,000,000 Common Shares -- Par Value $.0001
      each

     

     

           

     

     

    This
      Certifies That                         **(NAME)**                       is
      the owner of

     

     

                           **(letter
      amount)**                        fully
      paid and non-assessable Shares of the above Corporation transferable only on
      the
      books of the Corporation by the holder hereof in person or by duly authorized
      Attorney upon surrender of this Certificate properly
      endorsed.

     

     

           In
      Witness Whereof,
      the
      said Corporation has caused this Certificate to be signed by its duly
      authorized officers and to be sealed with the Seal of the
      Corporation.

     

     

    Dated________________________

     

     

    

     

     

    

     

    
      	 	 	 
	
               

              Secretary
                - Treasurer

               

            	 	
               

              President

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