EXHIBIT 10.4


 


SATCON TECHNOLOGY CORPORATION


NON-QUALIFIED STOCK OPTION AGREEMENT


 


(2005 Incentive Compensation Plan)


 


Agreement


 


1.                                      Grant of
Option.  The attached Notice of Grant
of Stock Options (the “Notice”) and this Non-Qualified Stock Option Agreement
evidence the grant by SatCon Technology Corporation (the “Company”), as of [                       ,
20   ], to the person names in the Notice (the
“Optionee”) an option (the “Option”) to purchase up to that number of shares of
the Company’s Common Stock, par value $0.01 per share, set forth in the Notice
(the “Shares”) at an exercise price per share set forth in the Notice (the “Exercise
Price”).  The Option shall be subject to
the terms and conditions set forth herein. 
The Option was issued pursuant to the Company’s 2005 Incentive
Compensation Plan (the “Plan”), which is incorporated herein for all
purposes.  The Option is a Non-Qualified
Stock Option, and not an Incentive Stock Option.  The Optionee hereby acknowledges receipt of a
copy of the Plan and agrees to be bound by all of the terms and conditions
hereof and thereof and all applicable laws and regulations.


 


2.                                      Definitions.  Unless otherwise provided herein, terms used
herein that are defined in the Plan and not defined herein shall have the meanings
attributed thereto in the Plan.


 


3.                                      Exercise
Schedule.  Except as otherwise
provided in Sections 6 or 9 of
this Agreement, or in the Plan, the Option will become exercisable (“vest”) in
accordance with the schedule set forth in the Notice, provided that the
Continuous Service of the Optionee continues through and on the applicable
vesting date (each, a “Vesting Date”). To the extent that the Option has become
exercisable with respect to a percentage of Shares, the Option may thereafter
be exercised by the Optionee, in whole or in part, at any time or from time to
time prior to the expiration of the Option as provided herein. Except as
otherwise specifically provided herein, there shall be no proportionate or
partial vesting in the periods prior to each Vesting Date, and all vesting
shall occur only on the appropriate Vesting Date. Upon the termination of the
Optionee’s Continuous Service with the Company and its Related Entities, any
unvested portion of the Option shall terminate and be null and void.


 


4.                                      Method of
Exercise.  The vested portion of this
Option shall be exercisable in whole or in part in accordance with the exercise
schedule set forth in Section 3 hereof by written notice which shall
state the election to exercise the Option, the number of Shares in respect of
which the Option is being exercised, and such other representations and
agreements as to the holder’s investment intent with respect to such Shares as
may be required by the Company pursuant to the provisions of the Plan.  Such written notice shall be signed by the
Optionee and shall be delivered in person or by certified mail to the Secretary
of the Company.  The written notice shall
be accompanied by payment of the Exercise Price.  This Option shall be deemed to be exercised
after both (a) receipt by the Company of such written notice accompanied
by the Exercise Price and (b) arrangements that are satisfactory to the
Committee in its sole discretion have been made for Optionee’s payment to the
Company of the amount, if any, that is necessary to be withheld in accordance
with applicable Federal or state withholding requirements.  No 


 





















 


Shares will be issued pursuant to the Option unless and until such
issuance and such exercise shall comply with all relevant provisions of
applicable law, including the requirements of any stock exchange upon which the
Shares then may be traded.


 


5.                                      Method of
Payment.  Payment of the Exercise
Price shall be by any of the following, or a combination thereof, at the
election of the Optionee:  (a) cash;
(b) check; (c) with Shares that have been held by the Optionee for at
least 6 months (or such other Shares as the Company determines will not cause
the Company to recognize for financial accounting purposes a charge for
compensation expense), (d) pursuant to a “cashless exercise” procedure, by
delivery of a properly executed exercise notice together with such other
documentation, and subject to such guidelines, as the Committee shall require
to effect an exercise of the Option and delivery to the Company by a licensed
broker acceptable to the Company of proceeds from the sale of Shares (or, to
the extent permitted by the Committee, a margin loan) sufficient to pay the
Exercise Price and any applicable income or employment taxes, or (e) such
other consideration or in such other manner as may be determined by the
Committee in its absolute discretion.


 


6.1                               Termination of
Options (excluding Outside, Non-Employee Directors).  Any unexercised portion of the Option shall
automatically and without notice terminate and become null and void at the time
of the earliest to occur of the following:


 


(a)                                 unless the Committee
otherwise determines in writing in its sole discretion, three (3) months
after the date on which the Optionee’s Continuous Service with the Company and
its Related Entities is terminated for any reason other than by reason of (i) termination
of the Optionee’s Continuous Service by the Company or a Related Entity for
Cause, (ii) a Disability of the Optionee, or (iii) the Optionee’s
death;


 


(b)                                 immediately upon the
termination of the Optionee’s Continuous Service with the Company and its
Related Entities for Cause;


 


(c)                                  twelve (12) months
after the date on which the Optionee’s Continuous Service with the Company and
its Related Entities is terminated by reason of a Disability;


 


(d)                                 twelve (12) months
after the date of termination of the Optionee’s Continuous Service with the
Company and its Related Entities by reason of the death of the Optionee (or, if
later, three (3) months after the date on which the Optionee shall die if
such death shall occur during the one year period specified in paragraph (c) of
this Section 6); or


 


(e)                                  the
tenth (10th) anniversary of the date as of which the Option is
granted.


 


6.2                               Termination of Options (for
Outside, Non-employee Directors).  Directors of the
Corporation shall have two years from the date of such cessation in which to
exercise any fully vested options. 
Notwithstanding the foregoing, if the Participant, prior to the Final
Exercise Date, violates the non-competition or confidentiality provisions of
any employment contract, confidentiality and nondisclosure agreement or other
agreement between the Participant and the Company, the right to exercise this
option shall terminate immediately upon such violation.


 


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7.                                      Transferability.  Unless otherwise determined by the Committee,
the Option granted hereby is not transferable otherwise than by will or under
the applicable laws of descent and distribution, and during the lifetime of the
Optionee the Option shall be exercisable only by the Optionee, or the Optionee’s
guardian or legal representative. In addition, the Option shall not be
assigned, negotiated, pledged or hypothecated in any way (whether by operation
of law or otherwise), and the Option shall not be subject to execution,
attachment or similar process. Upon any attempt to transfer, assign, negotiate,
pledge or hypothecate the Option, or in the event of any levy upon the Option
by reason of any execution, attachment or similar process contrary to the
provisions hereof, the Option shall immediately become null and void.  The terms of this Option shall be binding
upon the executors, administrators, heirs, successors and assigns of the Optionee.


 


8.                                      No Rights of
Stockholders.  Neither the Optionee
nor any personal representative (or beneficiary) shall be, or shall have any of
the rights and privileges of, a stockholder of the Company with respect to any
shares of Stock purchasable or issuable upon the exercise of the Option, in
whole or in part, prior to the date of exercise of the Option.


 


9.                                      Acceleration
of Exercisability of Option.


 


(a)                                                                            This
Option shall become immediately fully exercisable in the event that, prior to
the termination of the Option pursuant to Section 6 hereof, and during the
Optionee’s Continuous Service, there is a “Change in Control,” as defined in Section 9(b) of
the Plan.


 


(b)                                 Notwithstanding the
foregoing, if in the event of a Change in Control the successor company assumes
or substitutes for the Option, the vesting of the Option shall not be
accelerated as described in Section 9(a). 
For the purposes of this paragraph, the Option shall be considered
assumed or substituted for it following the Change in Control the Option or
substituted option confers the right to purchase, for each Share subject to the
Option immediately prior to the Change in Control, the consideration (whether
stock, cash or other securities or property) received in the transaction
constituting a Change in Control by holders of Shares for each Share held on
the effective date of such transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of
the outstanding shares); provided, however, that if such consideration received
in the transaction constituting a Change in Control is not solely common stock
of the successor company or its parent or subsidiary, the Committee may, with
the consent of the successor company, or its parent or subsidiary, provide that
the consideration to be received upon the exercise or vesting of the Option
will be solely common stock of the successor company or its parent or
subsidiary substantially equal in fair market value to the per share
consideration received by holders of Shares in the transaction constituting a
Change in Control.  The determination of
such substantial equality of value of consideration shall be made by the
Committee in its sole discretion and its determination shall be conclusive and
binding.  Notwithstanding the foregoing,
in the event of a termination of the Optionee’s employment in such successor
company (other than for Cause) within 24 months following such Change in
Control, the option held by the Optionee at the time of the Change in Control
shall be accelerated as described in paragraph (a) of this Section 9.


 


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10.                               No Right to Continued
Employment or Service.  Neither the
Option nor this Agreement shall confer upon the Optionee any right to continued
employment or service with the Company or any Related Entity.


 


11.                               Law Governing.  This Agreement shall be governed in
accordance with and governed by the internal laws of the State of Delaware.


 


12.                               Interpretation /
Provisions of Plan Control.  This
Agreement is subject to all the terms, conditions and provisions of the Plan,
including, without limitation, the amendment provisions thereof, and to such
rules, regulations and interpretations relating to the Plan adopted by the
Committee as may be in effect from time to time. If and to the extent that this
Agreement conflicts or is inconsistent with the terms, conditions and
provisions of the Plan, the Plan shall control, and this Agreement shall be
deemed to be modified accordingly. The Optionee accepts the Option subject to all
of the terms and provisions of the Plan and this Agreement.  The undersigned Optionee hereby accepts as
binding, conclusive and final all decisions or interpretations of the Committee
upon any questions arising under the Plan and this Agreement.


 


13.                               Notices.  Any notice under this Agreement shall be in
writing and shall be deemed to have been duly given when delivered personally
or when deposited in the United States mail, registered, postage prepaid, and
addressed, in the case of the Company, to the Company’s Secretary at 27 Drydock
Avenue, Boston, MA 02110, or if the Company should move its principal office,
to such principal office, and, in the case of the Optionee, to the Optionee’s
last permanent address as shown on the Company’s records, subject to the right
of either party to designate some other address at any time hereafter in a
notice satisfying the requirements of this Section.


 


14.                               Counterparts.  This Agreement may be executed in two or more
separate counterparts, each of which shall be an original, and all of which
together shall constitute one and the same agreement.


 


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OPTIONEE’S ACKNOWLEDGEMENT


 


The Optionee acknowledges receipt of a copy of the Plan and represents
that he or she has reviewed the provisions of the Plan and this Option
Agreement in their entirety, is familiar with and understands their terms and
provisions, and hereby accepts this Option subject to all of the terms and
provisions of the Plan and the Option Agreement.  The Optionee further represents that he or
she has had an opportunity to obtain the advice of counsel prior to executing
this Option Agreement.


 


	
  Dated:

  	
   

  	
   

  	
  OPTIONEE:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  



 


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