UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
SCHEDULE
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Soliciting Material Pursuant to
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CLEAN
DIESEL TECHNOLOGIES, INC.
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(Name
of Registrant as Specified In Its
Charter)
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CLEAN
DIESEL TECHNOLOGIES, INC.
10
Middle Street, Suite 1100
Bridgeport,
CT 06604
(203)
416-5290
________________________________________
Notice
of Annual Meeting of Stockholders
To
be Held May 13, 2009
________________________________________
To the
Stockholders of Clean Diesel Technologies, Inc.:
The
annual meeting (the “Meeting”) of stockholders of Clean Diesel Technologies,
Inc., a Delaware corporation (“Clean Diesel”), will be held at 2:00 p.m.,
Wednesday, May 13, 2009, at The Bridgeport Holiday Inn, 1070 Main Street,
Bridgeport, Connecticut 06604, U.S.A. to consider and vote upon the following
items, each of which is explained more fully in the attached Proxy
Statement. We have enclosed a proxy card for your use in
voting.
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1.
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To
elect seven (7) directors;
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2.
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To
authorize the directors to delist the Company’s Common Stock from the AIM
Market of the London Stock
Exchange;
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3.
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To
ratify the appointment of Eisner LLP as the Company’s independent auditors
for 2009; and
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4.
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To
transact any other business that may properly come before the Meeting or
any adjournment.
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Only
holders of our Common Stock of record at the close of business on March 16, 2009
are entitled to notice of and to vote at the Meeting.
Following the Meeting there will be a
presentation of our business activities and an opportunity for stockholders to
ask questions.
The Clean Diesel Technologies, Inc.
Annual Report for 2008 is enclosed with this Notice of Meeting and Proxy
Statement.
By Order
of the Board of Directors
Charles
W. Grinnell
Secretary
Bridgeport,
Connecticut
April 1,
2009
IMPORTANT
It is a
requirement of Delaware law for a properly constituted meeting, that a quorum of
the holders of one-third of the outstanding shares be present in person or by
proxy, therefore, whether or not you plan to attend the Meeting in person, it is
requested that you promptly fill out, date, sign and return the enclosed proxy
card or voting instruction form to the sender in the enclosed return
envelope.
Stockholders
in Great Britain should forward their proxy cards to Capita IRG, The Registry,
34 Beckenham Road, Beckenham, Kent BR3 4TU, U.K. and all other stockholders to
American Stock Transfer and Trust Company, 6201 15th Avenue, Third Floor,
Brooklyn, NY 11219, U.S.A.
Important Notice regarding the
Availability of Proxy Materials for the Annual Meeting: Clean
Diesel’s Proxy Statement and Annual Report to Stockholders are available
at: http://investor.cdti.com/index.cfm.
CLEAN DIESEL TECHNOLOGIES,
INC.
_______________
Proxy
Statement
_______________
The
Meeting and Form of Proxy
The Board of Directors of Clean Diesel
Technologies, Inc., a Delaware corporation, is soliciting your votes on the
enclosed form of proxy. The proxy is for your use in voting your
Clean Diesel shares at the 2009 annual meeting of stockholders. The
meeting will be at 2:00 p.m. on Wednesday May 13, 2009 at The Bridgeport
Holiday Inn, 1070 Main Street, Bridgeport, Connecticut 06604,
U.S.A. Any one of the persons you appoint on the form of proxy will
be your representative to vote your shares according to your instructions at the
Meeting and at any adjournments.
Shares
Eligible to Vote; Quorum
The record date for the Meeting is
March 16, 2009. You may vote at the Meeting in person or by proxy but
only if you were a stockholder of Clean Diesel Common Stock at the close of
business on the record date. At the record date, according to the
records of our transfer agents, American Stock Transfer and Trust Company and
Capita IRG, we had 8,138,304 shares of Common Stock outstanding. That
is the total number of shares of Common Stock that the stockholders may vote at
the Meeting. The Common Stock is our only outstanding
security. You may cast one vote for each share you
hold. You may examine a stockholders list showing the stockholders at
the record date at the Company address printed on the Notice of
Meeting. That list will also be available for inspection at the
Meeting.
The quorum for the Meeting, in other
words, the number of shares required to be present for a legally constituted
Meeting, is the presence in person or by proxy of holders of at least 2,712,769
shares of Common Stock, representing one-third of the outstanding
shares. Abstentions and broker non-votes are counted in determining
whether a quorum is present, but are not counted in the calculation of the
vote.
Form
of Proxy; Revocability
You may appoint a proxy, or
representative, at the Meeting other than the persons named on the enclosed form
of proxy. If you do wish to appoint some other person, who need not
be a stockholder, you may do so by completing another form of proxy for use at
the Meeting. Completed forms of proxy should be mailed promptly to
the transfer agent in the enclosed return envelope. You may also vote
electronically via the internet and we encourage you to do
so. Instructions for electronic voting are printed on your proxy
form.
You may revoke your proxy at any time
before it is voted, including at the Meeting. If you sign and return
your proxy and do not revoke it, the proxy holders will vote the shares it
represents at the Meeting in accordance with your instructions. If
the proxy is signed and returned without specifying choices, the shares will be
voted in accordance with the recommendations of the Board.
Proxy
Solicitation; Distribution
Members of the Board and our executive
officers and representatives of the Company’s transfer agents may solicit
stockholders' proxies. We will bear the cost of proxy solicitation,
if any.
We distributed this Proxy Statement and
the accompanying Annual Report to Stockholders, commencing April 15,
2009.
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1.
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ELECTION
OF DIRECTORS
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We are asking you to vote for the
election of seven nominees as directors of Clean Diesel. The nominees
were recommended by the Compensation and Nominating Committee of the
Board. The term of office of each director is until the 2010 annual
meeting or until a successor is duly elected or, if before then, a director
resigns, retires or is removed by the stockholders.
The
Nominees
The nominees are Michael L. Asmussen,
John A. de Havilland, David R. Gammon, Derek R. Gray, Charles W. Grinnell, John
J. McCloy II and David F. Merrion. These nominees are all
incumbents. Biographical information is set out below under the
caption “Directors and Executive Officers of Clean Diesel.” Details
concerning directors’ compensation are set out below under the captions
“Executive Compensation” and “Director Compensation.”
The
following table sets forth certain information with respect to each person
nominated and recommended to be elected as a director of Clean
Diesel.
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Name
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Age
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Director
Since
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Michael L.
Asmussen
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38
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2009
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John
A. de Havilland
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71
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1994
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David
R. Gammon
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47
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2008
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Derek
R. Gray
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75
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1998
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Charles
W. Grinnell
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72
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1994
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John
J. McCloy II
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71
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2005
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David
F. Merrion
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72
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2006
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Availability
The nominees have all consented to
stand for election and to serve, if elected. If one or more of these
nominees becomes unavailable or declines to accept election as a director, votes
will be cast for a substitute nominee, if any, designated by the Board on
recommendation of the Compensation and Nominating Committee. If no
substitute nominee is designated prior to the election, the individuals named as
proxies on the enclosed proxy card will exercise their judgment in voting the
shares that they represent, unless the Board reduces the number of directors and
eliminates the vacancy.
Plurality
Voting
A motion will be made at the Meeting
for the election as directors of the above mentioned seven
nominees. Under Delaware law and Clean Diesel’s By-laws, a vote by a
plurality of the shares voting is required for the election of
directors. Under plurality voting, directors who receive the most
“for” votes are elected; there is no “against” option and votes that are
“withheld” or not cast are disregarded in the count. If a nominee
receives a plurality of votes but does not, however, receive a majority of
votes, that fact will be considered by the Compensation and Nominating Committee
in any future decision on nominations.
The affirmative vote of a plurality of
the shares voting is required to elect the nominees as directors. The
Board recommends a vote FOR each of the
nominees.
2
DIRECTORS
AND EXECUTIVE OFFICERS
Michael
L Asmussen has been President, Chief Executive Officer and a director of
Clean Diesel since February 2009. He joined Clean Diesel in September
2008 as Vice President, Sales. In 2007, Mr. Asmussen was Vice
President, Sales and Marketing of Mirror Controls International, a mirror
actuator manufacturer. From 2002 to 2007, Mr. Asmussen held a variety
of managerial positions at Eaton Corporation, a diversified power management
company. From 2000 to 2002, he was Customer Manager, North America
for The Ford Motor Company. Mr. Asmussen holds BS and MBA
degrees.
John
A. de Havilland has been a director of Clean Diesel since its
inception. Mr. de Havilland was a director of J. Henry Schroder Wagg
& Co. Ltd., a merchant bank, from 1972 until his retirement in
1989.
David
R. Gammon has been a director of Clean Diesel since November
2008. He is a director and Chief Executive Officer of Rockspring
Advisory Services Limited, a United Kingdom investment and related services
company. He was a director of Amino Communications plc Advisory
Services Limited, a United Kingdom internet television product supply company,
from August 2006 to January 2007.
Derek
R. Gray has been a director of Clean Diesel since 1998. Mr.
Gray has been managing director of SG
Associates Limited, a United Kingdom fiscal advisory firm, since 1971 and a
director of Velcro Industries N.V., a manufacturing company, since
1974.
Charles
W. Grinnell has been Vice President, General Counsel, Corporate Secretary
and a director of Clean Diesel since its inception. He has been a
director of Fuel Tech, Inc., an emissions control company, since 1987 and Vice
President, General Counsel and Corporate Secretary of that company from 1987
until his retirement in February 2009. Mr. Grinnell holds JD and LLM
(Tax) degrees.
John
J. McCloy II has been a director of Clean Diesel since June
2005. He is a private investor concentrating on venture capital and
early stage investment projects in a variety of industries. He is
Chairman of Gravitas Technology, Inc., an information technology company; the
Sound Shore Mutual Fund, Inc.; Ashland Management, Inc., an investment advisory
firm; the American Council on Germany; and a member of the U.S. Council on
Foreign Relations. He was also a director of NCT Group, Inc., a
technology company, from 1986 to February 2007.
David
F. Merrion has been a director of Clean Diesel since June
2006. He is the principal of David F. Merrion LLC, a consulting
practice. Mr. Merrion is a retired Executive Vice President -
Engineering of Detroit Diesel Corporation, his employer from 1988 to
1999. He has been a director of Hy-Drive Technologies, Ltd., a
hydrogen technology company, since 2007. He has been a Director and
Chairman of Greenvision Technology, LLC, an intellectual property holding
company, since 2000. Mr. Merrion was Chairman of the Clean Diesel
Technical Advisory Board from 2005 until its termination in January
2009.
Dr.
Walter G. Copan, 55,
has been Vice President and Chief Technology Officer of Clean Diesel since
February 2009. Previously he had been Executive Vice President, North
American Operations & Chief Technology Officer from January 2006; and Vice
President and Chief Technology Officer from August 3, 2005 when he joined Clean
Diesel. Dr. Copan was Principal Licensing Executive, Technology
Transfer, of the National Renewable Energy Laboratory of the U.S. Department of
Energy from June 2003 to August 2005; and before that was Managing Director,
Technology Transfer and Licensing of The Lubrizol Corporation, a specialty
chemicals company, his employer since 1975. Dr. Copan holds a PhD degree in
chemical engineering.
Dr.
Daniel K. Skelton, 35, has been Vice President, Global Sales since
February 2009. He was previously Vice President, International since
August 2008; Commercial Director, Europe since September 2006 and Business
Development Manager, International since January 2005. From 2000 to
2004 Dr. Skelton was a Manager at Mitsui & Co. Ltd., an international
diversified company, with responsibilities for developing emission control
technology. Dr. Skelton holds a PhD degree in
metallurgy.
3
Dr. Bernhard Steiner, 60, left
the Company as an officer and director in February 2009. He was Chief
Executive Officer of Clean Diesel since September 2004 and President since
January 2006. Dr. Steiner held Executive Director positions from 2003
until 2008 at both Wayfinder Systems AB of Sweden, a navigation and location
software development company, and OWR AG, a leading nuclear, biological and
chemical protection solutions company. Dr. Steiner is not standing
for reelection as a director of the Company.
Timothy Rogers, 47, has been
Executive Vice President of International Operations since 2006; had been Vice
President, International of Clean Diesel from 2004; and had been a consultant to
Clean Diesel from 2003. From 2002 to September 2003, he was Director
of Sales and Marketing of ADAS Consulting, Ltd. and from 1993 to 2002, was a
director of Adastra, a wholly owned-subsidiary of Associated Octel Company,
Ltd., a U.K.-based multinational petrochemical company.
Ann B. Ruple, 57, has been
Vice President, Treasurer and Chief Financial Officer of Clean Diesel since
December 2006. Previously she had been Director, Financial Reporting,
Planning and Analysis of NCT Group, Inc., her employer since
1998. Ms. Ruple is a Certified Public Accountant and holds an MBA
Degree.
There are no family relationships among
any of the director nominees or executive officers. Other than the
recommendation of the Compensation and Nominating Committee of the Board, there
are no understandings or arrangements with any persons regarding the nomination
or election of any of the nominees. Please also see the text below
under the caption “Certain Relationships and Related Transactions.”
Committees
of the Board
The
standing Committees of the Board are an Audit Committee and a Compensation and
Nominating Committee. Messrs. de Havilland, Gray and McCloy are the
members of the Audit Committee. Messrs. de Havilland, McCloy and
Merrion are the members of the Compensation and Nominating
Committee. Mr. Gray is Chairman of the Audit
Committee. Mr. de Havilland is Chairman of the Compensation and
Nominating Committee. The Charters of the Audit and the Compensation
and Nominating Committees are available for viewing on the Clean Diesel web site
<www.cdti.com>.
4
The
Audit Committee
The Audit
Committee is responsible for review of audits, financial reporting and
compliance, and accounting and internal controls policy. For audit
services, the Audit Committee is responsible for the engagement and compensation
of independent auditors, oversight of their activities and evaluation of their
independence. The Audit Committee has instituted procedures for receiving
reports of improper record keeping, accounting or disclosure. The Board
has also constituted the Audit Committee as a Qualified Legal Compliance
Committee in accordance with Securities and Exchange Commission
regulations.
In the
opinion of the Board, each of the voting members of the Audit Committee has both
business experience and an understanding of generally accepted accounting
principles and financial statements enabling them to effectively discharge their
responsibilities as members of that Committee. Moreover, the Board has
determined that Mr. Gray is a financial expert within the meaning of Securities
and Exchange Commission regulations. In making this determination the
Board considered Mr. Gray’s formal training, and long experience in accounting
and auditing and his former service for many years as the Chairman of the Audit
Committee of another reporting company under the Securities Exchange
Act.
Compensation
and Nominating Committee
The Compensation and Nominating
Committee is responsible for establishing executive compensation and
administering Clean Diesel’s Incentive Compensation Plan and also identifies
director nominees for election to fill vacancies on our Board. Nominees
are approved by the Board on recommendation of the Committee.
In
evaluating nominees, the Committee particularly seeks candidates of high ethical
character with significant business experience at the senior management level
who have the time and energy to attend to Board responsibilities.
Candidates should also satisfy such other particular requirements that the
Committee may consider important to our business at the time. When a
vacancy occurs on the Board, the Committee will consider nominees from all
sources, including stockholders, nominees recommended by other parties, and
candidates known to the Directors or our management. The Committee may, if
appropriate, make use of a search firm and pay a fee for services in identifying
candidates. The best candidate from all evaluated will be recommended to
the Board to consider for nomination.
Stockholders who wish to recommend
candidates for consideration as nominees should on or before January 1 in each
year furnish in writing detailed biographical information concerning the
candidate to the Committee addressed to the Corporate Secretary of Clean Diesel
at the address set out on the Notice of Meeting.
Compensation & Nominating Committee
Interlocks and Insider Participation
There were no Compensation and
Nominating Committee interlocks or insider, i.e. employee, participation during
2008.
Corporate
Governance
Director Independence
Messrs. Gammon, Gray, de Havilland,
McCloy and Merrion are independent directors under the definition of NASDAQ Rule
4500(a)(15). The members of our Audit Committee, Messrs. de
Havilland, Gray and McCloy, are also independent under the more restrictive
independence standard applicable to Audit Committees in NASDAQ Rule
4350(d).
Meetings
During 2008 there were seven meetings
of our Board, four meetings of the Compensation and Nominating Committee and
four meetings of the Audit Committee. The Independent Directors met
in executive session of the Board without the presence of Management or employee
Directors on two occasions and the members of the Compensation and Nominating
Committee met in executive session on two occasions. The policy of
the Board is to hold at least two executive sessions of the Board annually and
executive sessions of committees when needed. Each Director attended
during 2008 at least 75% of Board and Committee meetings of which he was a
member. Clean Diesel does not have a formal policy relating to
director attendance at annual meetings but we anticipate that all of the
directors will attend the 2009 Annual Meeting. Each Director attended
the 2008 Annual Meeting.
5
Code of Business Ethics and
Conduct
On the
recommendation of the Audit Committee, the Board has adopted a Code of Business
Ethics and Conduct applicable to all of our officers and which is available for
viewing on the Clean Diesel web site <www.cdti.com>. Changes to or
waivers of the requirements of the Code will be posted to the web site and
reflected in appropriate Securities and Exchange Commission
filings.
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2.
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APROVAL OF AN APPLICATION TO
THE LONDON STOCK EXCHANGE TO DELIST THE COMMON STOCK OF THE COMPANY FROM
ADMISSION TO TRADING ON AIM.
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The Company’s Common Stock, $0.01 par
(the “Shares”) has been listed on the AIM Market (“AIM”) of the London Stock
Exchange plc (the “Exchange”) since December 20, 2001. The Shares became listed
on The NASDAQ Stock Market LLC (“NASDAQ”) on October 3, 2007.
On March 13, 2009, the Company’s Board
of Directors resolved that the Company should apply to the Exchange that the
Exchange “delist,” that is, cancel the admission of the Shares to trading on AIM
and that the Company, in accordance with the AIM Rules for Companies published
by the Exchange (“AIM Rules”) seek the approval of its stockholders for this
proposal at the May 13, 2009 Annual Meeting for their
approval. Accordingly, the proposed delisting from AIM is conditional
on the passing of the resolution set out below by the holders of not less than
75% of the Shares voting on this proposal at the Meeting. The
Company’s Nominated Advisor, Charles Stanley & Company Ltd., notified the
Exchange of the Board’s resolution on April 3, 2009.
In 2008, the Company expended the
estimated amount of $200,000 directly or indirectly on account of its listing on
AIM, which included fees and charges for the Exchange, the Nominated Advisor,
and London-based transfer and registration, and investor relations
services. Moreover, substantial internal financial and legal staff
time is taken up continually to comply with the regulatory aspects of the AIM
Rules that, in the opinion of the Directors, are duplicative of the NASDAQ
Marketplace Rules and the United States Securities and Exchange Commission
rules. Noteworthy, also, is that from the listing of the Shares on
NASDAQ in October 2007 through the end of 2008, the average daily trading volume
of the Shares has been 9,010 shares on NASDAQ and 700 shares on
AIM.
In the opinion of the Directors,
continued listing of the Shares on AIM while also listed on NASDAQ in an
unnecessary and duplicative expense and compliance burden. Each of
the Directors intends to vote his Shares in favor of this proposal.
The Company intends to maintain its
NASDAQ listing and, following the delisting of the Shares from AIM, Company
stockholders will continue to be able to trade on NASDAQ.
Accordingly, the following resolution
will be presented for approval at the Meeting:
“Resolved,
that the application of Clean Diesel Technologies, Inc. (the “Company”) to the
London Stock Exchange plc for cancellation of admission of the Company’s Common
Stock, $0.01 par, to trading on the AIM Market of the London Stock Exchange plc,
be, and the same hereby is, in all respects, approved.”
If the foregoing resolution is
approved, it is anticipated that the delisting of the Shares will take effect
from 7:00 a.m. London time on Thursday, May 21, 2009. Charles
Stanley, the Nominated Advisor has been consulted with respect to this delisting
and Charles Stanley has notified the Company that they will resign as Nominated
Advisor also with effect from 7:00 a.m. on May 21, 2009.
Under the AIM Rules, the affirmative
vote of the holders of 75% of the Shares voting at the Meeting is required to
adopt this proposal.
The Board of Directors recommends a
vote FOR this
proposal.
6
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3.
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APPOINTMENT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
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The Audit Committee has reappointed the
firm of Eisner LLP, Certified Public Accountants ("Eisner"), to be Clean
Diesel’s independent registered public accounting firm for the year 2009 and
submits that reappointment to stockholders for ratification. Eisner, an
independent member firm of Baker Tilly International, was also engaged to
perform that service by the Audit Committee for the 2008 audit. A
representative of Eisner is expected to be present at the Meeting and will have
the opportunity to respond to appropriate questions and, if the representative
desires to do so, to make a statement.
Audit Fees
Fees for professional services provided
by Eisner in the last two fiscal years by category were:
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2008
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2007
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|||||||
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Audit
Fees
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$ | 224,500 | $ | 195,000 | ||||
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Audit-Related
Fees
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11,632 | 44,000 | ||||||
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Tax
Fees
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─
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─
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||||||
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All
Other Fees
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─
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─
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||||||
| $ | 236,132 | $ | 239,000 | |||||
Audit
fees include fees for the audit of the financial statements, quarterly reviews
and Sarbanes-Oxley Section 404 internal controls. Audit-related fees
were for services in connection with Clean Diesel’s filing with the Securities
and Exchange Commission of a registration statement for the resale of Common
Stock and Warrants in 2008 and a registration statement for the shares reserved
for sale under the Clean Diesel Incentive Plan.
Pre-Approval Policies and
Procedures
The Clean Diesel Audit Committee policy
is that it must approve in advance an engagement of our independent registered
public accounting firm for any audit or non-audit service.
The affirmative vote of a majority of
the shares voting is required for the approval of this proposal. The Board
recommends a vote FOR
this proposal.
Report of the Audit
Committee
Management is responsible for Clean
Diesel’s internal controls and its financial reporting. Eisner, the
independent registered public accountant, is responsible for performing an audit
of Clean Diesel’s consolidated financial statements for the year ended December
31, 2008 (“Financial Statements”) in accordance with auditing standards
generally accepted in the United States of America and for expressing an opinion
on the Financial Statements based on their audit. Eisner is also
responsible for performing a Sarbanes-Oxley Section 404 internal controls audit
over Clean Diesel’s internal control over financial reporting and for expressing
an opinion based on their audit. In connection with the 2008 audit,
the Audit Committee reviewed the scope of the audit plans of the internal
auditors and Eisner. The Audit Committee then evaluated and discussed
with Management, the internal auditors and Eisner the results of audits
performed by the internal auditors and Eisner and their respective reports, both
as to accounting issues and internal controls, and, also, the opinions of Eisner
as to the Financial Statements and internal controls. Management has
represented that Clean Diesel’s 2008 consolidated financial statements were
prepared in accordance with accounting principles generally accepted in the
United States of America. Management has also represented that Clean
Diesel’s internal controls were effective at December 31, 2008.
The Committee has discussed with Eisner
the matters required to be discussed by the Statement on Auditing Standards No.
61 (Communication with Audit
Committees), as amended. The Committee has received the written
disclosures and the representation letter from Eisner required by Independence
Standards Board Standard No. 1 (Independence Discussions with Audit
Committees), as amended, and has discussed with the independent auditors
their independence.
7
Based on the representations and the
reviews and discussions referred to above, the Committee recommended to the
Board that the Financial Statements be included in Clean Diesel’s Annual Report
on Form 10-K for the year ended December 31, 2008 and filed with the Securities
and Exchange Commission.
This report has been provided by the
following members of the Audit Committee: J. A. de Havilland, D. R.
Gray, Chairman, and J. J. McCloy II.
PRINCIPAL
STOCKHOLDERS AND STOCK OWNERSHIP OF MANAGEMENT
The following table sets forth
information known to us regarding the beneficial ownership of Common Stock as of
March 16, 2009 by: (i) each person owning beneficially more than
three percent(4) of the
outstanding shares of Common Stock; (ii) each of our directors or director
nominees; (iii) the Named Executive Officers; and (iv) all directors and
executive officers as a group.
|
Beneficial
Owner Name and Address
(1)
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No. of Shares (2) (3)
|
Percentage
Beneficially
Owned (4)
|
||||||
|
Channel
Hotels and Properties Limited (3)
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387,638 | 4.8 | % | |||||
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Udaset
Holdings Limited
|
302,294 | 3.7 | % | |||||
|
Kanis
SA
|
343,769 | 4.2 | % | |||||
|
Positive
Securities Limited (David M. Hunter) (3)
|
422,761 | 5.2 | % | |||||
|
Fuel
Tech, Inc. (2)(3)
|
370,023 | 4.5 | % | |||||
|
Waltham Forest
Friendly Society (2)(3)
|
344,892 | 4.2 | % | |||||
|
Ruffer
LLP (3)
|
1,213,767 | 14.9 | % | |||||
|
Hawkwood
Fund Limited (3)
|
458,148 | 5.6 | % | |||||
|
Duckworth
Esq.
|
400,000 | 4.9 | % | |||||
|
Ram
Ltd.
|
295,139 | 3.6 | % | |||||
|
Avenir
Finances S.A.
|
450,000 | 5.5 | % | |||||
|
Innovator
Capital
|
|
283,974 | 3.4 | % | ||||
|
Directors and Named
Executive Officers
|
||||||||
|
Bernhard
Steiner (2)
|
162,090 | 2.0 | % | |||||
|
Walter
G. Copan (2)
|
61,394 | * | ||||||
|
John
A. de Havilland (2)
|
63,551 | * | ||||||
|
Derek
R. Gray (2)
|
189,308 | 2.3 | % | |||||
|
Charles
W. Grinnell (2)
|
58,860 | * | ||||||
|
John
J. McCloy II (2)
|
39,444 | * | ||||||
|
David
F. Merrion (2)
|
30,000 | * | ||||||
|
Timothy
Rogers (2)
|
56,073 | * | ||||||
|
Ann
B. Ruple (2)
|
32,421 | * | ||||||
|
Daniel
K. Skelton (2)
|
23,801 | * | ||||||
|
All
Directors and Officers as a Group (10 persons) (2)
|
554,851 | 6.5 | % | |||||
* Less
than 1%
|
(1)
|
The
address of Channel Hotels and Properties Limited is Gouray Lodge, Le Mont
de Gouray, Grouville, Jersey, Channel Islands JE3 9GH; of Udaset Holdings
Limited is Lord Coutanche House, 62-68 Esplanade Street, St. Helier,
Jersey, Channel Islands JE4 5PS; of Kanis SA, c/o SG Associates, Ltd., 82Z
Portland Place, London W1B 1NS, U.K.; of Positive Securities Limited
is 31, The Parade, St. Helier, Jersey, Channel Islands JE2 3QQ; of Fuel
Tech, Inc. is 512 Kingsland Drive, Batavia IL 60510; of Waltham Forest
Friendly Society is Key House, 342 Hoe Street, Walthamstow, London E17
9XP, U.K.; of Ruffer LLP is 80 Queen Victoria Street, London
SW1E 52C; and of Hawkwood Fund Limited and of Duckworth Esq. is The
Jersey Trust Company, Elizabeth House, 9 Castle Street, St. Helier,
Jersey, Channel Islands JE4 2QP; of Ram Ltd. is 82Z Portland Place, London
W1B 1NS, U.K.; of Avenir Finances S.A. is Channel House, Forest Lane,
St. Peter Port, Guernsey GY1 4HL, U.K.; of Innovator Capital, 4th
Floor, 20 Dering Street, London W1S 1AJ, U.K.; the address of
directors and Named Executive Officers is c/o Clean Diesel Technologies,
Inc., Suite 1100, 10 Middle Street, Bridgeport, Connecticut
06604.
|
8
|
(2)
|
In
addition to shares issued and outstanding, includes shares subject to
options or warrants exercisable within 60 days for Channel Hotels and
Properties Limited, 2,445 shares; Udaset Holdings Limited, 1,164 shares;
Kanis SA, 4,249 shares; Positive Securities Limited, 10,328 shares;
Waltham Forest Friendly Society, 5,000 shares; Fuel Tech, Inc., 5,000
shares; Ram Ltd., 2,630 shares; Dr. Copan, 56,333 shares; Mr. de
Havilland, 50,263 shares; Mr. Rogers, 53,333 shares; Dr. Steiner, 128,000
shares; Mr. Gray, 83,950 shares; Mr. Grinnell, 52,667 shares; Mr. McCloy,
32,000 shares; Mr. Merrion, 30,000 shares; Ms. Ruple, 30,000 shares; Dr.
Skelton, 21,467; and, for all directors and officers as a group, 417,013
shares. The amount for Mr. de Havilland and for directors and
officers as a group does not include 8,026 shares owned by Mr. de
Havilland’s adult children as to which he disclaims beneficial
ownership.
|
|
(3)
|
To
our knowledge, the directors and Named Executive Officers hold sole
beneficial ownership and investment power over the shares reported; Fuel
Tech, Inc. has sole beneficial ownership and investment power over its
shareholdings; and the remaining beneficial owners have at least shared
investment power over their
shareholdings.
|
|
(4)
|
The
percentages are percentages of outstanding stock and have been calculated
by including warrants and options exercisable within 60 days by the
respective stockholders. In addition, 3% rather than 5% is
presented in accordance with standard U.K. practice due to our listing on
the AIM Market of the London Stock
Exchange.
|
EXECUTIVE
COMPENSATION
Report
of Compensation and Nominating Committee
The Compensation and Nominating
Committee has reviewed and discussed with Management the Compensation Discussion
and Analysis which appears immediately below in this Proxy
Statement. Based on this review and discussion, the Committee has
recommended to the Board that the Compensation Discussion and Analysis be
included in this Proxy Statement.
By the
Compensation and Nominating Committee
John A.
de Havilland, Chairman, John J. McCloy II and David F. Merrion
Compensation
Discussion and Analysis
Compensation
Program Objectives
We develop, design, market
and license patented technologies and solutions that reduce harmful emissions
from internal combustion engines, while simultaneously improving fuel economy
and engine power. Continued investment in, and protection of our
intellectual property as well as intensive marketing and commercializing of our
products to increase revenue, are fundamental to us. We are committed
to ensuring our growth and maximizing stockholder value. To that end,
we have concentrated our efforts on enhancing our core
technologies,
building innovative product and service offerings, and promoting our expanding
brand portfolio. Thus, our compensation programs are designed to
enable us to achieve the following objectives:
|
|
·
|
to
ensure that we remain as a market leader in the development of innovative,
technical solutions;
|
|
|
·
|
to
attract, engage and retain top talent that ensures the achievement of
business goals, strategies and
objectives;
|
|
|
·
|
to
support an integrated team-oriented philosophy;
and
|
|
|
·
|
to
provide stockholders with a superior rate of
return.
|
9
Compensation
Elements
Our executive compensation program has
as a primary purpose our need to attract, retain and motivate the highly
trained, experienced individuals whose technical expertise and business talents
will enable us to succeed. The key components of that program during
the last fiscal year were base salary, annual bonus awards and long-term
incentives, as follows.
Base Salary
Executive base salaries are approved by
the Compensation and Nominating Committee on recommendation of the Chief
Executive Officer, except that the base salary of the Chief Executive Officer is
fixed by the Committee itself. In approving or fixing base salaries,
the Committee acts in its collective business judgment and experience on what it
understands to be fair, reasonable and equitable compensation in view of our
requirements for recruiting and retention in a highly competitive
market. The Committee does not rely on compensation
consultants. In its deliberations, the Committee
considers:
|
|
·
|
the
executive’s compensation relative to other
officers;
|
|
|
·
|
recent
and expected performance of the
executive;
|
|
|
·
|
our
recent and expected overall performance;
and
|
|
|
·
|
our
overall budget for base salary
increases.
|
In 2006,
in an effort to control costs, we implemented a salary reduction program for our
managers that reduced 2006 payroll expense by $101,000. In
2007, however, to satisfy our undertaking to employees in 2006 to restore the
salary reductions, if the Company’s performance justified it, we restored
approximately $44,000 of salary reductions.
In
December 2008, a salary freeze was initiated, with the exception of increases
for four employees, effective January 1, 2009.
Significant
2009 Executive Compensation Actions
On
February 10, 2009, Mr. Asmussen was elected as a Director, and as President and
Chief Executive Officer of Clean Diesel. On March 13, 2009, members
of the Compensation and Nominating Committee approved the general terms of Mr.
Asmussen’s compensation retroactive to the date of his
election. Thereafter, a form of Employment Agreement between Mr.
Asmussen and the Company was negotiated and became effective on March 30,
2009. Under that Agreement, Mr. Asmussen’s annual base salary will be
$285,000; he was awarded 40,000 restricted shares vesting one-third on each of
February 10, 2010, 2011 and 2012 provided he is employed on those dates; he will
participate in an annual incentive program with a target participation
percentage of 50% of base salary; he will be eligible for stock option awards
from time to time in the discretion of the Board of Directors; he will be
reimbursed for his reasonable expenses of relocation from Michigan to the
vicinity of the Company’s headquarters in Connecticut; he will be eligible for a
change of control bonus equal to one year’s base salary in the event of a change
in control of the Company approved in advance by the Board of Directors; if, in
any one year during the term of the Agreement, the Company shall have a pre-tax
profit, then the annual bonus pool for that one year will be enhanced by 30%; he
will be eligible for such corporate benefit and welfare plans as are generally
extended to employees; in the event of termination of his employment by the
Company “at will,” he will be eligible for salary and benefit continuation for
one year; the Company will negotiate with any control person to assume the one
year obligation of payment of salary and benefit continuation on termination “at
will” within one year after a change in control, and, if a control person does
not assume that obligation, the Company will guarantee the payment of six months
salary and benefit continuation.
10
Annual Incentive and Bonus
Awards
2008
In 2008, potential cash awards under
our incentive cash bonus program, called the Management Incentive Program
(“MIP”), were designed to focus our managers on the achievement of Company
financial targets for that year, as well as on individual objectives established
at the commencement of the year.
The 2008 MIP was structured as
follows:
Participation
in the incentive program was limited to managers.
Each
participant in the 2008 MIP was assigned a Target Participation Percentage
(“Target”) which was a percentage of annual gross salary. The Targets
assigned were: 50% for each of Dr. Steiner, Mr. Rogers, Dr. Copan and
Ms. Ruple; and 40% for Dr. Skelton. For each participant, individual
goals were set each representing a percentage of the Target, but all such goals
in total not exceeding 100% of Target. Payouts for goals attained
would be evaluated as having been attained on a scale of from 70% to
125%. No payout would be available for a goal evaluated at less than
70% and no payout could exceed 125% of a goal.
Dr.
Steiner’s goals were 2008 revenues of $14 million, 40%; attain a minimum year
end share price ranging from $17.50 to $22.50, 7.5% to 30%; enter into licensing
arrangements, 30%. Ms. Ruple’s goals were 2008 revenues of $14
million, 20%; implement management information technology reporting, 20%; staff
development, 20%; implement credit facilities, 20%; office relocation and lease
negotiation, 20%. Dr. Copan’s goals were American revenues of
$5,138,000, 30%; implement supply chain, 10%; enter into licensing arrangements,
30%; technology development, 20%; project management, 5%; technology assessment
and acquisition, 5%. Mr. Roger’s goals were international revenues of
$8,861,700, 50%; develop team, 20%; enter into licensing arrangements, 20%;
develop business strategies, 10%. Dr. Skelton’s goals were
international revenues of $8,861,700, 20%; European revenues of $6,000,000, 40%;
program management, 20%; and maximizing London Low Emission Zone margin,
20%.
Results
under the 2008 MIP were as follows:
Dr.
Steiner was recognized by the Committee as having attained in 2008, 100% of one
individual goal in connection with the Company’s licensing
program. Ms. Ruple was recognized as having attained three individual
goals, staff development evaluated at 75%, credit facilities evaluated at 100%,
and office relocation evaluated at 100%. Dr. Skelton, two goals,
European revenues evaluated at 100% and program management evaluated at
75%. In addition, while the Committee determined that Mr. Rogers had
not met his individual goals, nevertheless, he was recognized by the Committee
as having achieved substantial success in the management in 2008 of the
Company’s international business activities and was awarded a cash bonus
otherwise than pursuant to the 2008 MIP.
2007
In 2007, cash awards under our MIP were
designed to focus our managers on the achievement of Company financial targets
for that year, as well as on individual objectives established at the
commencement of the year.
The 2007 MIP was structured as
follows:
Participation
in the incentive program was limited to managers.
For each
of the above a bonus of 100% of Target was payable if the Company attained
budgeted revenue for 2007 of $6,369,000. Target for each of the above
means an amount equal to 25% of such person’s annual gross salary. If
80% of the budgeted revenue was attained, the bonus payable for each participant
would have been 90% of Target; if 70% of the budgeted revenue was attained, the
bonus payable would have been 80% of Target. If revenue was less than
70% of budgeted revenue, no bonus would have been payable. If an
amount of 150% of budgeted revenue was attained, then the bonus payable would
have been 150% of Target.
11
For
Bernhard Steiner:
The
Target was an amount equal to €100,000 and
|
|
1.
|
If
the above referenced budgeted revenue was attained, then a bonus of 25% of
Target would have been payable.
|
|
|
2.
|
If
the price per share of the Company’s Common Stock was in excess of $10.00
(adjusted for the reverse stock split) on June 30, 2007, then a bonus of
25% of Target would have been
payable.
|
|
|
3.
|
If
the price per share of the Company’s Common Stock was in excess of $12.50
per share (adjusted for the reverse stock split) on December 28, 2007,
then a bonus of 25% of Target would have been
payable.
|
|
|
4.
|
If
the Company’s Common Stock was listed on a recognized U.S. stock exchange
during 2007, then a bonus of 25% of Target would have been
payable.
|
Results
under the 2007 MIP were as follows:
Bernhard
Steiner ─ All milestones, except 92.5% of performance milestone (85% of plan
achieved).
Timothy
Rogers, Ann Ruple and Walter Copan ─ 92.5% of performance milestone (85% of plan
achieved).
2006
The 2006 MIP was structured as
follows:
Participation
in the incentive program was limited to managers.
For every
dollar of salary reduction under the salary reduction program described above,
the participant would have had the opportunity to recover that reduction by a
cash bonus payable on the attainment of progress toward the U.S. and
International sales goals for 2006. 25% of the bonus could have be
earned by meeting thresholds within the sales targets and the balance on meeting
personal goals agreed by the relevant manager and approved by the Chief
Executive Officer. Reduced salaries could have be made good on
attaining 65% of targets, another incremental amount almost equal to the salary
reduction could have be earned, if the revenue targets were attained, and, if
revenues were to reach 150% of the target, an amount approaching three times the
salary reduction could have been earned.
Results
under the 2006 MIP were as follows:
In 2006,
the financial metrics set for that year’s bonus program were not achieved, and,
accordingly, awards were not made to participants in the MIP. A
limited number of employees, however, did receive cash bonuses awarded in the
Committee’s business judgment on an individual performance basis, principally
related to our success in the 2006 fund raising effort and also with respect to
individual efforts related to our technologies. The Committee’s
approval of specific bonus payments to individual employees was based on several
considerations, including the employee’s base salary and specific identifiable
achievements. The 2006 bonus for Dr. Steiner was principally based on
the Committee’s evaluation of the value to Clean Diesel arising from Dr.
Steiner’s efforts in the 2006 fund raising program.
Long-Term
Incentives
We have one equity-based employee
compensation plan, referred to as the Incentive Plan, approved by the
stockholders in 1994 and in 2002, under which awards may be granted to
participants in the form of non-qualified stock options, incentive stock
options, stock appreciation rights, restricted stock, performance awards,
bonuses or other forms of share-based or non-share-based awards or combinations
thereof. Participants in the Incentive Plan may be our directors,
officers, employees, consultants or advisors (except consultants or advisors in
capital-raising transactions) as the directors determine are key to the success
of our business.
12
Our
long-term equity incentives are stock options and are designed to focus
management on the long-term success of the Company as evidenced by appreciation
of the Company’s stock price over several years, by growth in its earnings per
share and other elements, and thereby, to align the interests of the optionees
with the interests of the stockholders.
Details
concerning stock options awarded in 2008 to the Named Executive Officers and to
the directors are set out in the Summary Compensation Table and the Grants of
Plan-Based Awards Table following.
Management and Committee Compensation
Actions for 2008
At its meeting on December 18, 2007,
the Compensation and Nominating Committee approved salary increases effective
January 1, 2008 for thirteen employees, including Dr. Copan, Ms. Ruple, Mr.
Rogers and Dr. Skelton. The Committee discussed but did not act
on salary action for Dr. Steiner. The Committee also deferred
discussion on a 2008 MIP until the 2008 business plan had been
presented. On the same date, the Board of Directors awarded stock
options to directors, officers and employees to acquire 172,500 shares of Clean
Diesel Common Stock, including 33,500 shares to the non-executive directors and
84,000 shares to the Named Executive Officers.
Effective March 4, 2008, the
Compensation and Nominating Committee approved a new employment agreement for
Dr. Steiner by executing forms of unanimous written consent.
On March 11, 2008, the Compensation and
Nominating Committee approved of 2007 MIP payments for eleven participants
including the Named Executive Officers. The Committee also approved
of relocation expenses for Mr. Copan. On the same date, the Board of
Directors reviewed the business plan and budget for 2008 and deferred action on
a 2008 MIP until a later date.
On June 22, 2008, a proposed form of
2008 MIP Plan was circulated to the Compensation and Nominating Committee for
review. On June 30, 2008, the Committee met and approved the 2008 MIP
in the form presented in the June 22, 2008 proposal.
On September 4, 2008, the Board of
Directors met and elected Mr. Asmussen as Vice President Sales Americas and
approved his compensation as a base salary of $210,000; a stock option award to
acquire 10,000 shares; and an initial guaranteed bonus for 2008 of
$20,200.
On December 17, 2008, the Compensation
and Nominating Committee met and approved of a general salary freeze for all
employees with the exception of salary increases for four employees including
Ms. Ruple and Dr. Skelton. The Committee also approved of salaries
for three new employees. The Committee then reviewed and recommended
certain stock option awards to the Board of Directors. The Committee
deferred action on the 2009 MIP until a later date when the 2009 business plan
and budget is approved. On the same date, the Board of Directors
received the recommendations of the Compensation and Nominating Committee for
stock option awards and agreed to take action on a later date after
review. Thereafter, by forms of unanimous written consent effective
December 22, 2008, the Board approved of the award of non-qualified stock
options on the Company’s standard terms to acquire 174,500 shares of which
33,500 were awarded to non-executive directors and 84,000 to the Named Executive
Officers.
Ownership
Guidelines
We do not have a stock ownership policy
for Senior Executives.
13
Hedging
and Insider Trading Policies
We do not have a formal policy on
hedging. We prohibit trading in our securities during closed periods
which are the two months before the release of annual results and one month
before the release of quarterly results.
Equity
Grant Practices
Under the Incentive Plan, the Board
grants stock option awards for a term of not more than ten
years. Stock option awards are made by the full Board rather than the
Compensation and Nominating Committee because the non-executive directors
themselves are eligible for discretionary stock option awards. The
awards have an exercise price per share equal to fair market value on the grant
date. Fair market value is the mean of the high and low trading
price, or if there are not trading prices, the bid and asked prices, reported in
either case on The NASDAQ Stock Market LLC. The grant date is the
date of Board action but may be a future date tied to an event, such as
commencement of employment. Under the current policy of the Board,
awards to employees may be exercised one-third on the grant date and one-third
on each of the first and second anniversaries of the grant date; awards to new
employees may be granted so as to be exercised one-third on each of the first
through third anniversaries of grant; option awards may in the discretion of the
Board be Incentive Stock Options under Internal Revenue Code Section 422, if
awarded to U.S. employees; on resignation, options which may then be exercised
or continue to be exercisable for time periods depending on length of
employment, so that such options are exercisable for 180 days, if employed less
than three years; for two years, if employed for between three and five years;
for three years, if employed between five and seven years; for five years if
employed more than seven years; but in no event later than the basic ten-year
option term. In case of death, total disability or normal retirement,
the portion of the option then vested shall continue in force and be exercisable
until the expiration of the basic ten-year term, but the then unvested portion
of the option shall terminate and be of no effect.
Retirement
Benefits
We have no defined benefit pension
plan. We have a 401(k) Plan covering substantially all U.S.
employees. The 401(k) Plan is an important factor in attracting and
retaining employees as it provides an opportunity to accumulate retirement
funds. Our 401(k) Plan provides for annual deferral of up to $15,500
for individuals until age 50, $20,500 for individuals 50 and older, or, as
allowed by the Internal Revenue Code. If an employee contributes 5%
to the 401(k) Plan, we match 100% of employee contributions up to 4% of employee
salary. Matching contributions vest immediately.
Welfare
Benefits
In order to attract and retain
employees, we provide certain welfare benefit plans to its employees, which
include medical and dental insurance benefits. We may also provide
other benefits to executives including term life insurance and disability
insurance. These benefits are not provided to non-employee
directors.
Employment
Agreements; Severance Arrangements
Each of the “Named Executive Officers”
identified below in the Summary Compensation Table, is party to our form of
employment agreement with similar provisions. These agreements are
for indefinite terms except for Dr. Steiner whose agreement expires September
13, 2010. These agreements provide for severance
benefits. The severance benefit is payable in the event of
termination of employment because of physical incapacity or without
cause. Termination of employment without cause is termination under
circumstances other than resignation, retirement or cause and includes
constructive discharge. Termination for cause, for which no severance
is payable, is termination on account of conviction or plea of guilty to a
felony; any instance of fraud, embezzlement, self dealing, insider trading or
similar malfeasance with respect to the Company regardless of amount; substance
or alcohol abuse; or other conduct for which dismissal has been identified by us
in writing as a potential disciplinary measure.
The severance benefit for incapacity
for each of the officers is in the form of base salary for six
months. The severance benefit for termination without cause is base
salary and benefit continuation for varying time periods depending on the
employee or until the employee finds comparable employment. Benefit
continuation includes health and medical insurance, 401(k) Plan match, and the
employer’s portion of social security. The time periods and estimated
cash value of benefits are: for Ms. Ruple, six months ($118,000); for
Dr. Copan, one year ($281,000); and for Mr. Rogers, three months
($61,000). The value of these estimated severance benefits is based
on the amount of base salary and benefits payable from January 1, 2009 for the
applicable time period. For Dr. Steiner, the severance benefit under
his Employment Agreement of March 4, 2008 which is effective until September 13,
2010 will be approximately $510,000. For Mr. Asmussen, the severance benefit
under his Employment Agreement of March 20, 2009 is twelve months
($314,000).
14
Under the several employment
agreements, each of the officers is indefinitely obligated to maintain
confidentiality of our proprietary information and to assign inventions made in
the course of employment by us. Severance benefits are not explicitly
conditioned on these undertakings.
Options
Vesting on Change in Control
Under the Incentive Plan, all
outstanding options shown in the table below “Outstanding Equity Awards at
Fiscal Year End” for the Named Executive Officers will become immediately
exercisable in the event that there is with respect to us, a “Change in
Control.” A “Change in Control” takes place if (a) any person or
affiliated group becomes the beneficial owner of 51% or more of our outstanding
securities; (b) in any two-year period, persons in the majority of the Board
cease being so unless the nomination of the new directors was approved by the
former directors when they were in office; ( c) a business combination takes
place where our shares of Common Stock are converted to cash, securities or
other property, but not in a transaction in which our stockholders have
proportionately the same share ownership before and after the transaction; or
(d) our stockholders approve of a plan for our liquidation or
dissolution. See the text above under the caption “Significant 2009
Compensation Actions” for a description of Mr. Asmussen’s severance arrangements
following a change of control.
Indemnification
and Insurance
Under our Certificate of Incorporation,
indemnification is afforded our directors and executive officers to the fullest
extent permitted by Delaware law. Such indemnification also includes
payment of any costs which an indemnitee incurs because of claims against the
indemnitee and provides for advancement to the indemnitee of those costs,
including legal fees. We are, however, not obligated to provide
indemnity and costs where it is adjudicated that the indemnitee did not act in
good faith in the reasonable belief that the indemnitee’s actions were in our
best interests, or, in the case of a settlement of a claim, such determination
is made by our Board.
We carry insurance providing
indemnification, under certain circumstances, to all of our directors and
officers for claims against them by reason of, among other things, any act or
failure to act in their capacities as directors or officers. The
current annual premium for this policy is $43,000.
No payments have been made to any of
our past or present directors or officers for such indemnification or under any
insurance policy.
Compensation
Recovery Policies
We maintain a policy that we will
evaluate in appropriate circumstances whether to seek the reimbursement of
certain compensation awards paid to an executive officer, if such executive
engages in misconduct that caused or partially caused a restatement of our
financial results, in accordance with section 304 of the Sarbanes-Oxley Act of
2002. If circumstances warrant, we will seek to recover appropriate
portions of the executive officer’s compensation for the relevant period, as
provided by law.
Tax
Deductibility of Executive Compensation
We review and consider the
deductibility of executive compensation under the requirements of Internal
Revenue Code Section 162(m), which provides that we may not deduct compensation
of more than $1,000,000 that is paid to certain individuals. We
believe that compensation paid under our incentive plans is generally fully
deductible for federal income tax purposes.
15
Accounting
for Equity-Based Compensation
On January 1, 2006, we began accounting
for the equity-based compensation issued under the Incentive Plan in accordance
with the requirements of FASB Statement of Financial Accounting Standards No.
123R, “Share-based Payment.”
SUMMARY
COMPENSATION TABLE
The table below sets forth information
concerning fiscal year 2008 compensation in excess of $100,000 for the “Named
Executive Officers” in all capacities awarded to, earned by or paid to Dr.
Bernard Steiner, President and Chief Executive Officer; Ann B. Ruple, Vice
President, Treasurer and Chief Financial Officer; Timothy Rogers, Executive Vice
President, International; Dr. Walter G. Copan, Executive Vice President and
Chief Technical Officer; and Daniel K. Skelton, Vice President, Global Sales as
well as the fiscal 2007 and 2006 compensation.
|
Name
and Principal Position
|
Year
|
Salary
($)
|
Bonus
($)
(1)
|
Option
Awards
($)
(2)
|
Non-Equity
Incentive Plan Compensation ($) (3)
|
All
Other Compensation
($)
(4)
|
Total
($)
|
||||||||||||||||||
|
(a)
|
(b)
|
(c)
|
(d)
|
(f)
|
(g)
|
(i)
|
(j)
|
||||||||||||||||||
|
Bernhard
Steiner (5)
|
2008
|
$ | 334,574 |
$
|
─
|
$ | 310,774 | $ | 47,317 | $ | 89,427 | $ | 782,092 | ||||||||||||
|
President
and
|
2007
|
$ | 260,103 |
$
|
─
|
$ | 399,573 | $ | 144,487 | $ | 70,230 | $ | 874,393 | ||||||||||||
|
Chief
Executive Officer
|
2006
|
$ | 222,172 | $ | 67,585 |
$
|
─
|
$
|
─
|
$ | 66,269 | $ | 356,026 | ||||||||||||
|
Ann
B. Ruple (6)
|
2008
|
$ | 196,075 |
$
|
─
|
$ | 149,348 | $ | 53,921 | $ | 29,229 | $ | 428,573 | ||||||||||||
|
Vice
President, Treasurer
|
2007
|
$ | 158,300 | $ | 10,000 | $ | 134,482 | $ | 35,844 | $ | 25,616 | $ | 364,242 | ||||||||||||
|
and
Chief Financial Officer
|
2006
|
$ | 8,247 |
$
|
─
|
$ | 24,630 |
$
|
─
|
$
|
─
|
$ | 32,877 | ||||||||||||
|
Timothy
Rogers
|
2008
|
$ | 257,056 | $ | 14,495 | $ | 129,004 |
$
|
─
|
$ | 39,277 | $ | 439,832 | ||||||||||||
|
Executive
Vice President,
|
2007
|
$ | 258,695 |
$
|
─
|
$ | 153,319 | $ | 60,032 | $ | 33,401 | $ | 505,447 | ||||||||||||
|
International
|
2006
|
$ | 227,096 | $ | 19,643 |
$
|
─
|
$
|
─
|
$
|
─
|
$ | 246,739 | ||||||||||||
|
Walter
G. Copan
|
2008
|
$ | 252,367 |
$
|
─
|
$ | 147,448 |
$
|
─
|
$ | 169,610 | $ | 569,425 | ||||||||||||
|
Executive
Vice President
|
2007
|
$ | 204,124 | $ | 10,000 | $ | 177,962 | $ | 46,134 | $ | 56,135 | $ | 494,355 | ||||||||||||
|
and
Chief Technical Officer
|
2006
|
$ | 195,000 | $ | 25,000 |
$
|
─
|
$
|
─
|
$ | 27,446 | $ | 247,446 | ||||||||||||
|
Daniel
K. Skelton (6)
|
2008
|
$ | 182,557 |
$
|
─
|
$ | 54,981 | $ | 27,625 | $ | 23,932 | $ | 289,095 | ||||||||||||
|
Vice
President, Global Sales
|
|||||||||||||||||||||||||
|
(1)
|
These
bonus payments were for personal performance. See Note 3
below. Salary and incentive payments to Dr. Steiner and Mr.
Rogers were paid in euros and sterling, respectively, and were valued by
the dollar conversion rate for those currencies as reported in the Wall
Street Journal with respect to banking transactions of $1 million or more
as of the date accrued.
|
|
(2)
|
Option
awards do not represent cash paid to the optionees. The amounts
shown in these columns represent the dollar amounts recognized for
financial statement reporting purposes with respect to each fiscal year
for each Named Executive Officer, as computed in accordance with FAS 123R,
disregarding any estimates of forfeitures relating to service-based
vesting conditions. The methodology of and all assumptions made
in the valuation of these option awards are disclosed in Note 8 to Clean
Diesel’s Consolidated Financial Statements for the fiscal year
2008.
|
|
(3)
|
The
amount of the incentive bonus awarded to the Named Executive Officer in
March 2009 for 2008 performance was based on the metrics and other
criteria described in the Compensation Discussion and Analysis section
above for the 2008 Incentive Plan.
|
|
(4)
|
“All
Other Compensation” includes 401(k) match, life insurance premiums,
disability insurance premiums, medical and dental insurance premiums and,
includes, for Dr. Steiner, €60,000 ($83,124) pursuant to his employment
agreement as cash in lieu of medical and retirement plan benefits; for Dr.
Copan, $11,940 for 401(k) match, $16,231 in commuting costs and $18,995 in
medical and dental premiums, and $119,777 for the relocation of Dr. Copan
from Colorado to Connecticut. Further, for Mr. Rogers, $23,277
in medical insurance premiums; for Ms. Ruple, $18,634 in medical insurance
premiums; and for Dr. Skelton, $23,932 in medical insurance
premiums.
|
|
(5)
|
Dr.
Steiner resigned as Director, President and Chief Executive Officer of the
Company in February 2009 and was replaced by Mr. Michael L.
Asmussen.
|
|
(6)
|
Ms.
Ruple commenced employment on December 13, 2006 and Dr. Skelton was
elected a Vice President on August 8,
2008.
|
16
GRANTS
OF PLAN-BASED AWARDS
The following table sets out
information relating to grants of plan-based awards to the Named Executive
Officers in the fiscal year 2008.
|
Name
|
Grant
Date
|
All
Other
Stock
Awards: Number of Securities Underlying Options
(#)
|
Exercise
or Base Price of Option Awards
($)
|
Grant
Date Fair Value of Stock and Option Awards (1)
($)
|
||||||||||
|
(a)
|
(b)
|
(i)
|
(k)
|
(l)
|
||||||||||
|
Bernhard
Steiner
|
12/22/08
|
20,000 | $ | 2.705 | $ | 40,318 | ||||||||
|
Ann
B. Ruple
|
12/22/08
|
20,000 | $ | 2.705 | $ | 40,318 | ||||||||
|
Timothy
Rogers
|
12/22/08
|
15,000 | $ | 2.705 | $ | 30,238 | ||||||||
|
Walter
G. Copan
|
12/22/08
|
14,000 | $ | 2.705 | $ | 28,222 | ||||||||
|
Daniel
K. Skelton
|
12/22/08
|
15,000 | $ | 2.705 | $ | 30,238 | ||||||||
(1) Reflects
the grant date fair value computed in accordance with SFAS 123R.
OPTION
EXERCISES AND STOCK VESTED
There were no exercises of stock
options during 2008 for the Named Executive Officers. The Company did
not in 2008 have compensation programs that involved stock
vesting.
17
OUTSTANDING
EQUITY AWARDS AT FISCAL YEAR END
The following table sets out
information as to the Named Executive Officers concerning their unexercised
options awards, by award outstanding at fiscal 2008 year end.
|
Name
|
Number
of Securities Underlying Unexercised Options
# Exercisable
|
Number
of Securities Underlying Unexercised Options
# Unexercisable
|
Option
Exercise Price
|
Option
Expiration Date (1)
|
|||||||||
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
|||||||||
|
Bernhard
Steiner
|
30,000
|
─
|
$
|
9.20
|
09/13/14
|
||||||||
|
10,000
|
─
|
$
|
9.70
|
12/09/14
|
|||||||||
|
20,000
|
─
|
$
|
5.10
|
12/20/15
|
|||||||||
|
25,333
|
12,667
|
$
|
9.10
|
01/04/17
|
|||||||||
|
23,333
|
11,667
|
$
|
19.125
|
12/18/17
|
|||||||||
|
6,667
|
13,333
|
$
|
2.705
|
12/22/18
|
|||||||||
|
Ann
B. Ruple
|
10,000
|
─
|
$
|
8.25
|
12/13/16
|
||||||||
|
13,333
|
6,667
|
$
|
19.125
|
12/18/17
|
|||||||||
|
6,667
|
13,333
|
$
|
2.705
|
12/22/18
|
|||||||||
|
Timothy Rogers
|
20,000
|
─
|
$
|
9.75
|
09/30/13
|
||||||||
|
4,000
|
─
|
$
|
9.70
|
12/09/14
|
|||||||||
|
3,333
|
─
|
$
|
5.10
|
12/20/15
|
|||||||||
|
8,667
|
4,333
|
$
|
9.10
|
01/04/17
|
|||||||||
|
10,000
|
5,000
|
$
|
19.125
|
12/18/17
|
|||||||||
|
5,000
|
10,000
|
$
|
2.705
|
12/22/18
|
|||||||||
|
Walter
G. Copan
|
15,000
|
5,000
|
$
|
6.96
|
08/03/15
|
||||||||
|
10,000
|
─
|
$
|
5.10
|
12/20/15
|
|||||||||
|
10,000
|
5,000
|
$
|
9.10
|
01/04/17
|
|||||||||
|
11,667
|
5,833
|
$
|
19.125
|
12/18/17
|
|||||||||
|
4,667
|
9,333
|
$
|
2.705
|
12/22/18
|
|||||||||
|
Daniel
K. Skelton
|
6,000
|
─
|
$
|
7.25
|
03/04/15
|
||||||||
|
1,134
|
─
|
$
|
5.10
|
12/20/15
|
|||||||||
|
4,000
|
2,000
|
$
|
9.10
|
01/04/17
|
|||||||||
|
3,333
|
1,667
|
$
|
19.125
|
12/18/17
|
|||||||||
|
5,000
|
10,000
|
$
|
2.705
|
12/22/18
|
|||||||||
|
(1)
|
The
option expiration date indicated is the tenth anniversary of the date of
grant. Each of the foregoing options is for a ten-year term and
vests as to the shares granted, one-third on grant and one-third on each
of the first and second anniversaries of grant. On resignation,
those of the above options which have not expired may continue to be
exercisable for time periods depending on length of employment, so that
such options are exercisable for 180 days, if employed less than three
years; for two years, if employed for between three and five years; for
three years, if employed between five and seven years; for five years if
employed more than seven years; but in no event later than the basic
ten-year option term. In case of death, total disability or
normal retirement, the portion of the option then vested shall continue in
force and be exercisable until the expiration of the basic ten-year term,
but the then unvested portion of the option shall terminate and be of no
effect.
|
18
DIRECTOR
COMPENSATION
In 2008, our directors were paid an
annual retainer of $30,000. The Chairman of the Board and the
Chairman of the Audit Committee received, respectively, an additional annual
retainer of $30,000 and $10,000. Retainers were paid quarterly in
arrears. There are no meeting fees. Directors are also
eligible for stock option awards. Stock option awards to
non-executive directors are, under the current policy of the Board, for a
ten-year term and are fully vested when granted. Directors who are
also our employees or executive officers receive no compensation for their
service as directors as such, and accordingly, Messrs. Grinnell and Steiner are
not included in the table.
Summary
Director Compensation Table
The following table shows for our
non-executive directors all compensation earned in 2008 on account of fees,
whether paid in cash or stock, and stock option awards.
|
Name
|
Fees
Earned Or
Paid
in Cash
($)
|
Option
Awards (1)
($)
|
Total
($)
|
|||||||||
|
J.
A. de Havilland
|
$ | 30,000 | $ | 14,655 | $ | 44,655 | ||||||
|
D.
R. Gray
|
70,000 | 26,170 | 96,170 | |||||||||
|
J.
J. McCloy II
|
30,000 | 14,655 | 44,655 | |||||||||
|
D.
F. Merrion
|
50,000 |
(2)
|
14,655 | 64,655 | ||||||||
|
D.
R. Gammon (3)
|
4,584 |
─
|
4,584 | |||||||||
|
(1)
|
The
values shown for 2008 option awards were calculated in accordance with
SFAS No. 123R and do not represent cash paid to the
optionee.
|
|
(2)
|
Includes
$20,000 fees attributable to service on the Company’s Technical Advisory
Board.
|
|
(3)
|
Elected
as a director on November 6,
2008.
|
19
DIRECTORS
OUTSTANDING STOCK OPTIONS AT 2008 FISCAL YEAR END
The following table sets out by grant
date the outstanding options held at year end 2008 by the
directors. All of these options are vested.
|
Name
|
Number
of Securities
Underlying
Unexercised
Options
#
|
Option
Exercise
Price
|
Option
Expiration
Date
(1)
|
||||||
|
(a)
|
(b)
|
(c)
|
(d)
|
||||||
|
John
A. de Havilland
|
2,000 | $ | 4.50 |
06/14/09
|
|||||
| 2,000 | $ | 12.50 |
02/10/10
|
||||||
| 2,000 | $ | 9.825 |
03/14/11
|
||||||
| 5,000 | $ | 14.50 |
03/13/12
|
||||||
| 4,000 | $ | 8.25 |
06/11/13
|
||||||
| 2,000 | $ | 15.35 |
12/02/13
|
||||||
| 3,000 | $ | 9.70 |
12/09/14
|
||||||
| 3,000 | $ | 5.10 |
12/20/15
|
||||||
| 5,000 | $ | 9.10 |
01/04/17
|
||||||
| 7,000 | $ | 19.125 |
12/18/17
|
||||||
| 7,000 | $ | 2.705 |
12/22/18
|
||||||
|
Derek
R. Gray
|
2,000 | $ | 4.50 |
06/14/09
|
|||||
| 2,000 | $ | 12.50 |
02/10/10
|
||||||
| 2,000 | $ | 9.825 |
03/14/11
|
||||||
| 5,000 | $ | 14.50 |
03/13/12
|
||||||
| 7,000 | $ | 8.25 |
06/11/13
|
||||||
| 4,000 | $ | 15.35 |
12/02/13
|
||||||
| 5,000 | $ | 9.70 |
12/09/14
|
||||||
| 3,000 | $ | 5.10 |
12/20/15
|
||||||
| 10,000 | $ | 9.10 |
01/04/17
|
||||||
| 12,500 | $ | 19.125 |
12/18/17
|
||||||
| 12,500 | $ | 2.705 |
12/22/18
|
||||||
|
John
J. McCloy II
|
10,000 | $ | 7.875 |
06/09/15
|
|||||
| 3,000 | $ | 5.10 |
12/20/15
|
||||||
| 5,000 | $ | 9.10 |
01/04/17
|
||||||
| 7,000 | $ | 19.125 |
12/18/17
|
||||||
| 7,000 | $ | 2.705 |
12/22/18
|
||||||
|
David
F. Merrion
|
11,000 | $ | 8.375 |
11/13/16
|
|||||
| 5,000 | $ | 9.10 |
01/04/17
|
||||||
| 7,000 | $ | 19.125 |
12/18/17
|
||||||
| 7,000 | $ | 2.705 |
12/22/18
|
||||||
|
David
R. Gammon
|
─
|
$
|
─
|
─
|
|||||
(1) Each
of these options is for a ten-year term and was fully vested on date of
grant.
20
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
Management
and Services Agreement
We
entered into a Management and Services Agreement dated July 1995, as amended
(the "Services Agreement") with Fuel Tech, Inc., successor to Fuel-Tech
N.V. As of March 16, 2009, Fuel Tech, Inc. held 4.5% of our Common
Stock. The Services Agreement was terminated effective January 31,
2009. Services provided to us under the Services Agreement were
principally legal services provided by Mr. Grinnell who was an employee of Fuel
Tech, Inc. until January 31, 2009 and continues as a director of Fuel Tech, Inc.
Mr. Grinnell, a director and officer of Clean Diesel, became an employee of
Clean Diesel effective February 1, 2009. In 2008, 2007 and 2006, the
amounts of $70,000, $71,000 and $70,000, respectively, were paid by us to
Fuel Tech, Inc. in each year on account of these services. Mr. Grinnell
will recuse himself from consideration of any transactions between these
companies that may be, or may appear to be, material to either
company.
Advisory
Services
Rockspring
Advisory Services Limited, of which Mr. Gammon is a principal, has provided
advisory services on technology-related investments since 2008 to Hawkwood
Capital LLP, an affiliate of holders of 10.5% of the Company’s Common
Stock.
Technology
Assignments
Our
technology is comprised of patents, patent applications, trade or service marks,
data and know-how. A substantial portion of this technology is held under
assignments of technology from Fuel Tech, Inc. The assignments provide for
running royalties payable to Fuel Tech, Inc. commencing in 1998 of 2.5% of gross
revenues derived from platinum fuel catalysts. Such royalties incurred in
2008, 2007 and 2006 were $20,700, $14,300 and $14,500. This royalty
obligation to Fuel Tech, Inc. expired on December 31, 2008.
GENERAL
Section
16(a) Beneficial Ownership Reporting Compliance
Based on filings with the Securities
and Exchange Commission, we believe that all our officers and directors were in
compliance with 2008 filing requirements relating to beneficial ownership
reports under Section 16(a) of the Securities Exchange Act of 1934, except that
the following filings, each relating to a single event or transaction, were
delayed: for Mr. Asmussen a Form 3 due September 5 was filed
September 8; and for Dr. Skelton a Form 3, due August 6, was filed August 13 and
a Form 4, due October 10, was filed September 14.
Communications
with the Board of Directors
Any
stockholder desiring to send a communication to the Board, or any individual
director, may forward such communication to the Corporate Secretary to
our address set out on the Notice of Meeting. Under procedures fixed
from time to time by the independent directors, the Corporate Secretary will
collect and organize all such communications and forward them to the Board or
individual director.
Stockholder
Proposals in Company Proxy Statement
Proposals of stockholders intended for
inclusion in the Proxy Statement and proxy to be mailed to all stockholders
entitled to vote at our 2010 annual meeting must be received in writing at the
address set out on the Notice of Meeting on or before December 2, 2009
and thereafter, may be excluded.
21
Other
Business
Management knows of no other matters
that properly will be, or are likely to be, brought before the Meeting other
than those described in this Proxy Statement. To bring other matters
before the Meeting, and without reference to the notice requirements for a
request to include matters in our proxy materials, that is, to propose a matter
at the Meeting from the floor, a stockholder must provide both timely and
adequate written notice to the Secretary as described in Section 2.12 of the
Clean Diesel by-laws. Such a notice for the 2009 Meeting must have
been received prior to February 12, 2009, and for the 2010 Meeting must be
received not earlier than December 14, 2009 and not later than February 12,
2010. The Clean Diesel By-Laws are available for viewing under
“Company Filings” at the SEC web site www.sec.gov as
Exhibit 3.1 to its Form 10-Q for the period ending September 30,
2008.
By Order
of the Board of Directors
Charles
W. Grinnell
Secretary
Bridgeport, Connecticut
April 1,
2009
We will provide without charge to each
person being solicited by this Proxy Statement, upon written request, a copy of
the Annual Report of Clean Diesel Technologies, Inc. on Form 10-K for the year ended
December 31, 2008, without exhibits but including the consolidated financial
statements and schedules thereto, as filed with the Securities and Exchange
Commission. All such requests should be directed
to the Corporate Secretary at our address on the Notice of
Meeting.
Statements in this Proxy Statement
which are not historical facts, so-called “forward-looking statements” are made
pursuant to the safe harbor provisions of the United States Private Securities
Litigation Reform Act of 1995. Stockholders are cautioned that all
forward-looking statements involve risks and uncertainties, including those
detailed in our filings with the Securities Exchange
Commission.
22
|
PROXY
|
PROXY
|
SOLICITED
BY THE BOARD OF DIRECTORS
CLEAN
DIESEL TECHNOLOGIES, INC.
Annual
Meeting of Stockholders - May 13, 2009
The
undersigned hereby appoints Derek R. Gray, Michael L. Asmussen, or Charles W.
Grinnell, acting singly, with full power of substitution, proxies for the
undersigned and authorizes them to represent and vote, as designated on the
reverse side, all of the shares of Common Stock of Clean Diesel Technologies,
Inc. ("Clean Diesel" or "the Company") which the undersigned may be entitled to
vote at the annual meeting of stockholders of Clean Diesel to be held at The
Bridgeport Holiday Inn, 1070 Main Street, Bridgeport, Connecticut 06604 USA on
Wednesday, May 13, 2009 at 2:00 p.m., and at any adjournments or postponements
of the meeting, for the approval of the agenda items set forth below and with
discretionary authority as to any other matters that may properly come before
the meeting, all in accordance with and as described in the accompanying Notice
of Meeting and Proxy Statement. The Board of Directors recommends a vote for
election as Director of each of the nominees, for the authorization of the
Directors to delist the Company's Common Stock from the AIM Market of the London
Stock Exchange and for the ratification of the appointment of the independent
auditors, and, if no direction is given, this proxy will be voted for all
nominees, for the delisting of the Common Stock from the AIM Market and for
ratification of the appointment of the auditors.
(Continued
and to be signed on the reverse side.)
ANNUAL
MEETING OF STOCKHOLDERS OF
CLEAN
DIESEL TECHNOLOGIES, INC.
May
13, 2009
NOTICE OF
INTERNET AVAILABILITY OF PROXY MATERIAL:
The
Notice of Meeting, proxy statement and proxy card
are
available at http://investor.cdti.com/index.cfm
Please
sign, date and mail
your
proxy card in the
envelope
provided as soon
as
possible.
Please detach along perforated line and
mail in the envelope provided. |
20730300000000000000
9
|
051309
|
PLEASE SIGN, DATE
AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR
BLACK INK AS SHOWN HERE x
|
FOR
|
AGAINST
|
ABSTAIN
|
|||||||||
|
1.
|
Election of Directors: To approve the election as directors of the following: | 2. |
To
authorize the Directors to delist the Company's Common Stock
from the AIM Market of the London Stock Exchange.
|
o
|
o
|
o
|
|||||
|
NOMINEES:
|
|
|
|
||||||||
|
o
|
FOR
ALL NOMINEES
|
m
|
Michael
L. Asmussen
|
|
|
|
|||||
|
m
|
John
A. de Havilland
|
||||||||||
|
o
|
WITHHOLD
AUTHORITY
|
m
|
David
R. Gammon
|
|
|
|
|
||||
| FOR ALL NOMINEES |
m
|
Derek
R. Gray
|
3. |
To
ratify the appointment of Eisner LLP as the independent auditors for the
year 2009.
|
o
|
o
|
o
|
||||
|
|
|
m
|
Charles
W. Grinnell
|
||||||||
|
o
|
FOR ALL EXCEPT |
m
|
John
J. McCloy II
|
|
|
|
|||||
|
(See
instructions below)
|
m
|
David
F. Merrion
|
|||||||||
|
|
|||||||||||
|
|
INSTRUCTIONS: To withhold
authority to vote for any individual nominee(s), mark “FOR
ALL EXCEPT” and fill in the circle next to each nominee you wish to
withhold, as shown here: ●
|
||||||||||
|
|
|||||||||||
|
To
change the address on your account, please check the box at right and
indicate
your new address in the address space above. Please note that changes
to the registered name(s) on the account may not be submitted via
this
method.
|
o
|
||||||||||
|
Signature
of Stockholder
|
Date:
|
Signature
of Stockholder
|
Date:
|
|
Note:
|
Please
sign exactly as your name or names appear on this Proxy. When shares are
held jointly, each holder should sign. When signing as executor,
administrator, attorney, trustee or guardian, please give full title as
such. If the signer is a corporation, please sign full corporate name by
duly authorized officer, giving full title as such. If signer is a
partnership, please sign in partnership name by authorized
person.
|
ANNUAL
MEETING OF STOCKHOLDERS OF
CLEAN
DIESEL TECHNOLOGIES, INC.
May
13, 2009
|
PROXY
VOTING
INSTRUCTIONS
|
|
INTERNET -
Access “www.voteproxy.com”
and follow the on-screen
instructions. Have your proxy card available when you access
the web page, and use the
Company Number and Account Number shown on your proxy card.
Vote
online until 11:59 PM EST the day before the meeting.
MAIL -
Sign, date and mail your proxy card in the envelope provided as
soon as possible.
IN
PERSON -
You may vote your shares in person by attending the Annual
Meeting.
|
COMPANY
NUMBER
|
||
|
ACCOUNT
NUMBER
|
|||
|
|
|||
|
|
|
NOTICE
OF INTERNET AVAILABILITY OF PROXY MATERIAL: The Notice of meeting,
proxy statement and proxy card are available at
http://investor.cdti.com/index.cfm
|
|
|
Please
detach along perforated line and mail in the envelope provided IF you are not voting via the
Internet.
|
|
|
20730300000000000000
9
|
051309
|
PLEASE SIGN, DATE
AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR
BLACK INK AS SHOWN HERE x
|
FOR
|
AGAINST
|
ABSTAIN
|
|||||||||
|
1.
|
Election of Directors: To approve the election as directors of the following: | 2. |
To
authorize the Directors to delist the Company's Common Stock
from the AIM Market of the London Stock Exchange.
|
o
|
o
|
o
|
|||||
|
NOMINEES:
|
|
|
|
||||||||
|
o
|
FOR
ALL NOMINEES
|
m
|
Michael
L. Asmussen
|
|
|
|
|||||
|
m
|
John
A. de Havilland
|
||||||||||
|
o
|
WITHHOLD
AUTHORITY
|
m
|
David
R. Gammon
|
|
|
|
|
||||
| FOR ALL NOMINEES |
m
|
Derek
R. Gray
|
3. |
To
ratify the appointment of Eisner LLP as the independent auditors for the
year 2009.
|
o
|
o
|
o
|
||||
|
|
|
m
|
Charles
W. Grinnell
|
||||||||
|
o
|
FOR ALL EXCEPT |
m
|
John
J. McCloy II
|
|
|
|
|||||
|
(See
instructions below)
|
m
|
David
F. Merrion
|
|||||||||
|
|
|||||||||||
|
|
INSTRUCTIONS: To withhold
authority to vote for any individual nominee(s), mark “FOR
ALL EXCEPT” and fill in the circle next to each nominee you wish to
withhold, as shown here: ●
|
||||||||||
|
|
|||||||||||
|
|
To
change the address on your account, please check the box at right and
indicate
your new address in the address space above. Please note that changes
to the registered name(s) on the account may not be submitted via
this
method.
|
o
|
|||||||||
|
Signature
of Stockholder
|
Date:
|
Signature
of Stockholder
|
Date:
|
|
Note:
|
Please
sign exactly as your name or names appear on this Proxy. When shares are
held jointly, each holder should sign. When signing as executor,
administrator, attorney, trustee or guardian, please give full title as
such. If the signer is a corporation, please sign full corporate name by
duly authorized officer, giving full title as such. If signer is a
partnership, please sign in partnership name by authorized
person.
|