Exhibit 10.1

 

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OVERVIEW – EXECUTIVE COMPENSATION PHILOSOPHY

 

The primary objective of Satcon’s executive compensation program is to attract,
retain, and motivate the best possible executive talent in pursuit of our
business strategy of being a leading global provider of utility scale
distributed power solutions for the renewable energy market.  The focus is to
tie short and long-term incentives to the achievement of measurable corporate
and individual performance objectives.   Our executive compensation structure
not only aims to be competitive in our market sector, but also to be fair
relative to compensation paid to other professionals within our organization. As
we continually develop our compensation approach, we aim to implement an
approach that rewards our executives when we achieve our target goals and
objectives.  As our business evolves, we seek to foster a performance-oriented
culture, where individual performance is aligned with organizational
objectives.  Executives will be evaluated and rewarded based on their
organizational contributions to the achievement of short and longer term
objectives; their openness to challenging and improving current policies and
structures; their willingness to foster a highly creative team-oriented
environment; and their ability to take advantage of unique business
opportunities and overcome difficult challenges within the emerging renewable
energy and distributed power business sectors.

 

An important component of Satcon’s executive total compensation program is an
annual cash Incentive Plan that ties a significant portion of senior
management’s overall compensation to the achievement of short term annual
objectives.

 

SATCON 2008 INCENTIVE PLAN

FOR SENIOR MANAGEMENT

 

Section 1: Purpose

 

The Satcon 2008 Incentive Plan (the “Plan”) is designed to:

 

·

 

Attract and retain highly qualified executives and other personnel by providing
competitive annual incentive opportunities.

 

 

 

·

 

Provide performance-leveraged incentives that motivate and reward superior
managerial performance and the profitable growth of Satcon Technology
Corporation (the “Company”).

 

 

 

·

 

Support a performance oriented environment that differentiates individual
rewards based on performance and results.

 

SECTION 2: DEFINITION OF TERMS

 

a)                                      Board means the Board of Directors of
the Company.

 

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b)                                     Committee means the Compensation
Committee of the Board.

 

c)                                      Participants shall be the persons
eligible to participate in the Plan, consisting of the Corporation’s “Executive
Officers” (as defined under Rule 3b-7 under the Securities Exchange Act of 1934,
as amended) and other named participants, as determined by the Committee from
time to time.  As of the effective date of the Plan, the Participants are
(i) the President & Chief Executive Officer; (ii) the Chief Financial Officer;
(iii) the Vice President of Engineering & Chief Technology Officer; (iv) the
Vice President, Administration & Secretary; (v) the Vice President of Sales &
Marketing; (vi) the Vice President Operations and (vii) those individuals who
directly report to the Executive Officers at the Director Level.

 

SECTION 3: PLAN ADMINISTRATION

 

The Committee shall have sole and complete discretion to administer and
interpret the Plan with respect to the Participants.  The decisions of the
Committee concerning administration and interpretation of the Plan shall be
final and binding. The Plan shall continue in its current form until and unless
action is taken by the Board to modify or terminate the Plan.

 

SECTION 4: PLAN YEAR

 

The Plan performance year shall be the Company’s fiscal year (January 1 –
December 31, 2008). After the end of the fiscal year, cash incentive payments
earned under the Plan shall be determined and approved by the Committee in
accordance with the provisions of the Plan.

 

SECTION 5: PERFORMANCE TARGETS AND MEASUREMENT

 

The Plan, which has been approved by the Committee and the Board, outlines
general performance goals and business criteria upon which each Participant’s
performance will be evaluated.  Specific performance goals and business criteria
will be subsequently approved by the Committee.  Performance will be measured
against these specific performance goals and business criteria, which will be
established for each functional area of the organization.  Generally, (i) for
the President & CEO, performance will be evaluated based on overall corporate
objectives and (ii) for all other Participants, performance will be evaluated
based on relevant operations, sales & marketing, engineering, finance and
administration objectives.

 

General 2008 objectives are summarized as follows:

 

President & CEO – Corporate:  Overall corporate objectives will include
objectives related to the Company’s focus and market position, growth,
product/service quality, profitability and leadership team.

 

Operations:  Operations objectives will include objectives related to business
operating models, manufacturing and plant capacity, customer performance and
long-term strategies.

 

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SALES & MARKETING:  SALES & MARKETING OBJECTIVES WILL INCLUDE OBJECTIVES RELATED
TO DIRECT SALES TEAM ORGANIZATION, SALES METHODOLOGY, FORECAST METHODOLOGY AND
CUSTOMER RELATIONSHIP MANAGEMENT SYSTEMS, GLOBAL BUSINESS DEVELOPMENT AND
CHANNELS ORGANIZATION, BRANDING INITIATIVES AND FIELD SERVICES ORGANIZATION.

 

Engineering:  Engineering objectives will include objectives related to product
quality, design processes and new products.

 

Finance:  Finance objectives will include objectives related to management
information, information systems, planning processes, financial operating models
and control environment.

 

Administration:  Administration objectives will include objectives related to
compensation strategy, performance management systems, annual cash incentive
programs, rewards programs, internet access, domain upgrades and help desk
administration.

 

Section 6:  2008 Potential Incentive Award Opportunity

 

·                  President & CEO:

·                  Up to 60% of Base Salary upon attainment of 100% of target
objectives

 

·                  Other Executive Officers:

·                  Up to 30% of Base Salary upon attainment of 100% of target
objectives

 

·                  Other (Director level) Participants:

·                  Up to 20% of Base Salary upon attainment of 100% of target
objectives

 

Section 7: Earning an Award

 

The President & CEO annually reviews other Participant’s performance with the
Committee and makes recommendations to the Committee with respect to the
appropriate payments to be made under the Plan.  Based in part on the CEO’s
recommendations and other considerations, the Committee approves the incentive
payments (other than the CEO).  The Compensation Committee independently
evaluates the performance of the CEO and determines and approves the incentive
payment earned for the given performance period.

 

Section 8: Final Approval

 

After determining and approving incentive payments under the Plan, as discussed
in Section 7 above, the Committee will then recommend to the Board payments to
be made under the Plan. The Board must approve payments made under the Plan. 
Final determination of any and all employee compensation will be based on the
sole discretion of the Compensation Committee with Board of Director approval.
Any payments under the Plan shall be paid by March 15, 2009.

 

Section 9: Other Provisions

 

(a)           Earning a Payment Under the Plan.  Payments under the Plan shall
not be earned until they are approved by the Board in accordance with Section 8
above. In addition, payments under the Plan shall not be earned if, on the final
date of the fiscal year, the Participant is not in compliance with either his or
her employment agreement (if any) or the non-disclosure agreement.  A
Participant is entitled to payment under the Plan, if earned (which requires
approval of the Board), if the

 

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Participant is employed on the last day of the fiscal year, subject to the prior
sentence and Sections 9(e) and 9(f) below.

 

(b)           Plan Amendment.  The Board may, at any time and from time to time,
amend, alter, suspend, discontinue or terminate the Plan, as it deems necessary
or appropriate to achieve the purposes of the Plan or for other business
reasons.

 

(c)           No Right to Employment.  The existence of this Plan shall not be
construed as giving a Participant the right to continued employment or any
future right to participate in the Plan.

 

(d)           Other Corporate Benefit and Compensation Programs.  Participation
in this Plan shall not be deemed as part of a Participant’s regular, recurring
compensation for purposes of calculating payments or benefits from any Company
benefit or severance program (or severance pay law of any country) unless
otherwise specified in the particular benefit plan or benefit plan documents.

 

(e)           Retirement, Disability or Death.  In the event a Participant would
otherwise earn an incentive award pursuant to this Plan, but the Participant
does not qualify because of the Participant’s death, disability or retirement,
then the Participant shall be deemed to have “earned” his or her award, subject
to the approval by the Board.  The term “disability” shall have the meaning
ascribed to such term in the employment agreement between the Participant and
the Company (or, in the event that the Participant does not have any employment
agreement with the Company, shall mean “the inability to perform services for
the Company for an aggregate of 90 days during any 365-day period”). The
Committee shall interpret the term “retirement”.

 

(f)            Employment for a Portion of a Plan Year.  The CEO may recommend
and the Committee, at its sole discretion, may permit a Participant to
participate in the Plan during a fiscal year in which the Participant was not
employed by the Company for the full fiscal year. Such participation may be on a
pro rata basis or on such other basis as the Committee determines.

 

(g)           Unfunded Plan.  The Plan shall be unfunded and shall not create
(or be construed to create) a trust or separate fund(s). Likewise, the Plan
shall not establish any fiduciary relationship between the Company and any other
Participant or other person. To the extent that any person holds any rights by
virtue being a Participant under the Plan, such right shall be no greater than
the right of an unsecured general creditor of the Company.

 

(h)           Successors and Assignees.  The Plan shall be binding on all
successors and assignees of a Participant, including, without limitation, the
estate of such Participant and the executor, administrator or trustee of such
estate, or any receiver or trustee in bankruptcy or representative of the
Participant’s creditors.

 

(i)            Governing Law.  The validity, construction and effect to the Plan
and any actions taken under the Plan shall be determined in accordance with
applicable laws of the State of Delaware.

 

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