Form of Non Qualified Stock Option Agreement

Exhibit 10.12


NON QUALIFIED STOCK OPTION

AGREEMENT (this " Agreement" ) dated as of

February 28, 2007, between MOMENTIVE

PERFORMANCE MATERIALS HOLDINGS INC. , a Delaware corporation (the " Company" ),

and the Optionee set forth on the signature page to

this Agreement (the " Optionee" ).

WHEREAS , pursuant to the Stock and Asset Purchase Agreement (the " Purchase Agreement" ) made and entered into as of the 14 th day of September, 2006, by and between General Electric Company, a New York corporation (" Seller" ) and the Company (formerly known as Nautilus Holdings Acquisition Corp.), the Company has purchased the stock of certain affiliates and subsidiaries of the Seller (the " Transaction" );

WHEREAS, the Company, acting through the Committee with the consent of the Company' s Board of Directors (the " Board" ) has agreed to grant to the Optionee, effective on February 28, 2007 (the " Grant Date" ), an option under the Momentive Performance Materials Holdings Inc. 2007 Long-Term Incentive Plan (the " Plan" ) to purchase a number of shares of Common Stock on the terms and subject to the conditions set forth in this Agreement and the Plan; and WHEREAS , the Optionee purchased shares of the Company' s common stock pursuant to a subscription agreement dated February 28, 2007 (the " Subscription Agreement" ) and in connection therewith, became a party to the Amended and Restated Securityholders Agreement relating to the Company, by and among the Company and certain of its securityholders, dated as of December 3, 2006, as the same may be amended from time to time (the " Securityholders Agreement" ), or an adoption agreement thereto in the form attached as Exhibit A thereto (an " Adoption Agreement" ); WHEREAS , future securities in the Company (including those being acquired pursuant to this Agreement) owned by the Optionee shall be subject to the terms of the Securityholders Agreement.

NOW, THEREFORE, in consideration of the promises and of the mutual agreements contained in this Agreement, the parties hereto hereby agree as follows:

Section 1. The Plan . The terms and provisions of the Plan are hereby incorporated into this Agreement as if set forth herein in their entirety. In the event of a conflict between any provision of this Agreement and the Plan, the provisions of this Agreement shall control. A copy of the Plan may be obtained from the Company by the Optionee upon request. Capitalized terms used herein and not otherwise defined herein shall have the respective meanings ascribed thereto in the Plan or the Securityholders Agreement, as the case may be. Section 2. Option; Option Price . Effective on the Grant Date, on the terms and subject to the conditions of the Plan and this Agreement, the Company hereby grants to the Optionee the option (the " Option" ) to purchase Shares pursuant to Tranche A options (" Tranche A Options" ), Tranche B options (" Tranche B Options" ) and Tranche C Options (" Tranche C

Options" ) at the price per Share (the " Option Price" ) and in the amounts set forth on the signature page hereto. To the extent permitted by the Committee, payment of the Option Price may be made in any manner specified by Section 5.6 of the Plan. The Option is not intended to qualify for federal income tax purposes as an " incentive stock option" within the meaning of Section 422 of the Code.

Section 3. Term . The term of the Option (the " Option Term" ) shall commence on the Grant Date and expire on the tenth anniversary of the Grant Date, unless the Option shall have sooner been terminated in accordance with the terms of the Plan (including, without limitation, Article V of the Plan) or this Agreement.

Section 4. Vesting . Subject to the Optionee' s not having a Termination of Relationship prior to the applicable vesting date and except as otherwise set forth in Section 7 , the Options shall become non-forfeitable and exercisable (any Options that shall have become non-forfeitable and exercisable pursuant to Section 4 , the " Vested Options" ) according to the following provisions:

(a) Tranche A Options . Twenty-percent (20%) of the Tranche A Options shall become Vested Options on each of the 14 th , 24 th , 36 th , 48 th and 60 th month anniversaries of the Closing Date (as defined in the Purchase Agreement). In the event of the consummation of a Change in Control upon which the Tranche B Targets (as defined in Section 4(b) below) are met, 50% of the Tranche A Options which have not theretofore become Vested Options and which are scheduled to vest on each of the remaining vesting dates based on anniversaries of the Closing Date will vest upon the earlier of (i) the Optionee' s continued employment with the Company for 12 months after such Change in Control or (ii) a Termination of Relationship by the Company or its Subsidiaries without Cause within 12 months following the consummation of such Change in Control. In the event of the consummation of a Change in Control upon which the Tranche C Targets (as defined in Section 4(c) below) are met, each Tranche A Options which has not theretofore become a Vested Options and which are scheduled to vest on each of the remaining vesting dates based on anniversaries of the Closing Date will vest upon the earlier of (i) the Optionee' s continued employment with the Company for 12 months after such Change in Control or (ii) a Termination of Relationship by the Company or its Subsidiaries without Cause within 12 months following the consummation of such Change in Control. ...