Unassociated Document


    COMPOSITE
TECHNOLOGY CORPORATION

    STOCK
OPTION NOTICE OF MODIFICATION AND REISSUANCE

    2002
NON-QUALIFIED STOCK COMPENSATION PLAN

    


    Between
October 15, 2008 and January 20, 2009 the Board of Directors of Composite
Technology Corporation (“Board”), approved one modification of the Composite
Technology Corporation (“Company”) 2002 Non-Qualified Stock Compensation Plan
(“2002 Plan”) and agreed to reduce the exercise price for certain options
granted under the 2002 Plan Option Agreement(s) (“Option Agreement”) previously
entered into between the Optionee listed below and the Company.  The
changes affect the terms of the original Option Agreements, consisting of
modification of sections 2, Purchase Price; and Section 4, Effect of Termination
of Optionee Relationship.   Other Option Agreements may also have
had modifications made to vesting schedules that may be different from the
original Option Agreement.  This Notice of Modification and Reissuance
(“Notice”) and the revised 2002 Master Option Agreement (“Master Option
Agreement”) serve to supersede the original Stock Option Grant Notice and Option
Agreement between the parties. Capitalized terms used but not defined herein
shall have the meanings ascribed thereto in the Master Option
Agreement.

    


    The
intent of this Notice is to supersede and modify the original Option Agreement
as follows:

    
      	
              i)  

            	
              To
      change the Exercise Price of the Option to $0.35 per share for all vested
      but unexercised shares as of January 20, 2009 and all unvested shares
      outstanding as of January 20, 2009;
and

            


    

    
      	
              ii)  

            	
              To
      change the expiration date of the Option from December 31, 2011 to
      December 31, 2016; and

            


    

    
      	
              iii)  

            	
              To
      clarify vesting schedule as set forth
below.

            


    

    


    
      
        
          	
                  Optionee:

                	 	 
      
	
                  Option
      Grant #:

                	 	 
      
	
                  Original
      Date of Grant:

                	 	 
      
	
                  Original
      Exercise Price:

                	 	 
      
	
                  Original
      Number of Shares Subject to Option:

                	 	 
      
	 
      	 	 
      
	
                  Date
      of Repricing:

                	 	
                  January
      21, 2009

                
	
                  Number
      of Shares subject to Option that are Repriced:

                	 	 
      
	
                  Revised
      Exercise Price (Per Share):

                	 	
                  US$
      0.35

                
	
                  Total
      Exercise Price:

                	 	 
      
	
                  Expiration
      Date:

                	 	
                  December
      31, 2016

                


        

      

    

     

     

    Vesting
Schedule for Shares unvested as of January 20, 2009:

    


    INSERT
TABLE FOR REMAINING VESTING

    


    


    Accelerated
vesting may apply under certain events, as defined in the Master Agreement and
the 2002 Plan.

     

    
      
        
          
            	
                    Payment:

                  	 	
                    By
      cash or check

                  
	 
      	 	
                    Same
      day sale program (if permitted by the Board)

                  
	 
      	 	
                    Tender
      of Common Stock (if permitted by the
Board)

                  


          

        

      

    

     

    Additional
Terms/Acknowledgements:  The Optionee acknowledges receipt of, and
understands and agrees that his or her Option is modified as described and
remains subject to this Notice, the revised Master Option Agreement and the 2002
Plan except for the rights conveyed to shareholders for options granted under
the original Option Agreement and which were exercised prior to this
Notice.  The Optionee warrants and represents that they have either i)
lost the original option agreement or ii) returned the original option agreement
to the Company.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    The
Optionee further acknowledges that as of the Date of Repricing set forth herein,
this Notice, the Master Agreement and the 2002 Plan set forth the entire
understanding between Optionee and the Company regarding the acquisition of the
Company’s Shares covered by this Notice and these documents supersede all prior
oral and written agreements on that subject with the exception of (i) additional
option grants with differing original dates of grant than this Notice which are
previously or subsequently granted and delivered to Optionee under the 2002 Plan
or the Company’s 2008 Stock Option Plan, and (ii) the agreements, if any, listed
below.  To the extent that this Notice varies the terms of the Master
Agreement, this Notice will prevail only with respect to Options granted
pursuant to this Notice.

    ______________

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          	
                                  COMPOSITE
      TECHNOLOGY CORPORATION

                                	 	
                                  OPTIONEE:

                                
	 
      	 	 
      
	
                                  By: 
      Benton H. Wilcoxon,

                                	 	
                                  By:  (Insert
      Optionee Name)

                                
	 
      	 	 
      
	 
      	 	 
      
	 
      	 	 
      
	 
      	 	 
      
	
                                  Title: 
      Chief Executive Officer

                                	 	 
      
	
                                  Date:

                                	 	
                                  Date:

                                
	 	 	 
	  
      	  
      	  
      
	 	 	 
	Spouse
      of Optionee (if applicable)	 	By:
	 	 	 
	 	 	 
	 	 	Date: