EX-10.3



 Exhibit 10.3 

NON-QUALIFIED STOCK OPTION GRANT NOTICE 

UNDER THE NORTHERN POWER SYSTEMS CORP. 

2014 STOCK OPTION AND INCENTIVE PLAN 

Pursuant to the Northern Power Systems Corp. 2014 Stock Option and Incentive Plan (the “Plan”), Northern Power Systems Corp., a
corporation incorporated pursuant to the laws of the Province of British Columbia (the “Company”), has granted to the individual named below, an option (the “Stock Option”) to purchase on or prior to the Expiration Date, or such
earlier date as is specified herein, all or any part of the number of voting common shares (“Common Shares”) of the Company indicated below (the “Shares”), at the Option Exercise Price per share, subject to the terms and
conditions set forth in this Non-Qualified Stock Option Grant Notice (the “Grant Notice”), the attached Non-Qualified Stock Option Agreement (the “Agreement”) and the Plan. This Stock Option is not intended to qualify as an
“incentive stock option” as defined in Section 422(b) of the Internal Revenue Code of 1986, as amended from time to time (the “Code”). 
  

							
	Name of Optionee:	 	  
	 	(the “Optionee”)
			
	No. of Shares:	 	  
	 	Common Shares
			
	Grant Date:	 	  
	 	
			
	Vesting Commencement Date:	 	  
	 	(the “Vesting Commencement Date”)
			
	Expiration Date:	 	  
	 	(the “Expiration Date”)
				
	Option Exercise Price/Share:	 	$	 	  
	 	(the “Option Exercise Price”)
		
	Vesting Schedule:	 	One-third of the Shares shall vest and become exercisable on the first anniversary of the Vesting Commencement Date, provided that the Optionee continues to have a service relationship with the Company at such time.
Thereafter, the remaining two-thirds of the Shares shall vest and become exercisable in eight (8) equal installments at the end of each three-month period following the first anniversary of the Vesting Commencement Date, provided the Optionee
continues to have a service relationship with the Company on each vesting date. Notwithstanding anything in the Agreement to the contrary, in the case of a Sale Event (as defined in the Plan), this Stock Option and the Shares shall be treated as
provided in Section 3(c) of the Plan; provided, however upon a “Change in Control”, all of the then unvested options shall vest. A “Change in Control” means any of the following, unless the Administrator (as defined in the
Plan) provides otherwise:

  

	 	i.	any merger or consolidation in which the Company shall not be the surviving entity (or survives only as a subsidiary of another entity whose stockholders did not own all or substantially all of the shares of the Company
in substantially the same proportions as immediately prior to such transaction); 









	 	ii.	the sale of all or substantially all of the Company’s assets to any other person or entity (other than a wholly-owned subsidiary); 


 

	 	iii.	the acquisition of beneficial ownership of seventy-five percent (75%) or more of the outstanding shares of the Company by any person or entity (including a “group” as defined by or under
Section 13(d)(3) of the Exchange Act); 

  

	 	iv.	a contested election of directors of the Company, as a result of which or in connection with which the persons who were directors before such election or their nominees (the “Incumbent Directors”) cease to
constitute a majority of the Board of Directors of the Company; provided however that if the election, or nomination for election by the Company’s shareholders, of any new director was approved by a vote of at least fifty percent (50%) of
the Incumbent Directors of the Company, such new director shall be considered as an Incumbent Director; 

  

	 	v.	a Sale Event; or 

 any other event specified by the Administrator, regardless of whether at the
time an Award (as defined in the Plan) is granted or thereafter. 
 Attachments: Non-Qualified Stock Option Agreement, 2014 Stock Option and
Incentive Plan 

  
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 NON-QUALIFIED STOCK OPTION AGREEMENT 

UNDER THE NORTHERN POWER SYSTEMS CORP. 

2014 STOCK OPTION AND INCENTIVE PLAN 

All capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Grant Notice and the Plan, as
applicable. 
 1. Vesting, Exercisability and Termination. 

(a) No portion of this Stock Option may be exercised until such portion shall have vested and become exercisable. 

(b) Except as set forth below, and subject to the determination of the Administrator in its sole discretion to accelerate the vesting schedule
hereunder, this Stock Option shall be vested and exercisable on the respective dates indicated below: 
 (i) This Stock
Option shall initially be unvested and unexercisable. 
 (ii) This Stock Option shall vest and become exercisable in
accordance with the Vesting Schedule set forth in the Grant Notice. 
 (c) Termination. Except as may otherwise be provided by the
Administrator, if the Optionee’s service relationship is terminated, the period within which to exercise this Stock Option will be subject to earlier termination as set forth below (and if not exercised within such period, shall thereafter
terminate subject, in each case, to Section 3(c) of the Plan): 
 (i) Termination Due to Death or Disability. If
the Optionee’s service relationship terminates by reason of such Optionee’s death or disability, this Stock Option may be exercised, to the extent exercisable on the date of such termination, by the Optionee; the Optionee’s legal
representative or legatee for a period of 12 months from the date of death or disability or until the Expiration Date, if earlier. 

(ii) Other Termination. If the Optionee’s service relationship terminates for any reason other than death or
disability, and unless otherwise determined by the Administrator, this Stock Option may be exercised, to the extent exercisable on the date of termination, for a period of three months from the date of termination or until the Expiration Date, if
earlier; provided however, if the Optionee’s service relationship is terminated for Cause, this Stock Option shall terminate immediately upon the date of such termination. “Cause” shall mean (i) the Optionee’s
dishonest statements or acts with respect to the Company or any affiliate of the Company (as defined in the Plan), or any current or prospective customers, suppliers vendors or other third parties with which such entity does business; (ii) the
Optionee’s commission of (A) a felony or (B) any misdemeanor involving moral turpitude, deceit, dishonesty or fraud; (iii) the Optionee’s failure to perform his or her assigned duties and responsibilities to the reasonable
satisfaction of the Company which failure continues, in the reasonable judgment of the Company, after written notice given to the Optionee by the Company; (iv) the Optionee’s gross negligence, willful misconduct or insubordination with
respect to the Company or 

  
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any affiliate of the Company; or (v) the Optionee’s material violation of any provision of any agreement(s) between the Optionee and the Company relating to noncompetition,
nonsolicitation, nondisclosure and/or assignment of inventions. 
 For purposes hereof, the Administrator’s determination of the reason
for termination of the Optionee’s service relationship shall be conclusive and binding on the Optionee and his or her representatives or legatees. Subject to subsection 1(c)(i) and (ii), any portion of this Stock Option that is not vested and
exercisable on the date of termination of the service relationship shall terminate immediately and be null and void. 
 2. Exercise of
Stock Option. 
 (a) The Optionee may exercise this Stock Option only in the following manner: Prior to the Expiration Date, the
Optionee may deliver a Stock Option exercise notice (an “Exercise Notice”) in the form of Appendix A hereto indicating his or her election to purchase some or all of the Shares with respect to which this Stock Option is then
exercisable. Such notice shall specify the number of Shares to be purchased. Payment of the purchase price may be made by one or more of the methods described in Section 5 of the Plan, subject to the limitations contained in such Section of the
Plan, including the requirement that the Administrator specifically approve in advance certain payment methods. 
 (b) Notwithstanding any
other provision hereof or of the Plan, if the Company is required by any regulatory authority to increase the Option Exercise Price in connection with any offering of the Company’s equity securities or any offering of the equity securities of
any entity into which the Company has merged or plans to merge for the purpose of completing such offering, then from and after the date on which such increase is required by such regulatory authority, the Option Exercise Price shall automatically
be so increased without any action by the Optionee and without any requirement of the Optionee’s consent. 
 (c) Notwithstanding any
other provision hereof or of the Plan, no portion of this Stock Option shall be exercisable after the Expiration Date. 
 3.
Incorporation of Plan. Notwithstanding anything herein to the contrary, this Stock Option shall be subject to and governed by all the terms and conditions of the Plan. To the extent that a provision of this Agreement is in conflict with or
inconsistent with the terms and conditions of the Plan, the terms and conditions of this Agreement shall prevail. 
 4. Transferability
of Stock Option. This Stock Option is personal to the Optionee and is not transferable by the Optionee in any manner other than by will or by the laws of descent and distribution. The Stock Option may be exercised during the Optionee’s
lifetime only by the Optionee (or by the Optionee’s guardian or personal representative in the event of the Optionee’s incapacity). The Optionee may elect to designate a beneficiary by providing written notice of the name of such
beneficiary to the Company, and may revoke or change such designation at any time by filing written notice of revocation or change with the Company; such beneficiary may exercise the Optionee’s Stock Option in the event of the Optionee’s
death to the extent provided herein. If the Optionee does not designate a beneficiary, or if the designated beneficiary predeceases the Optionee, the legal representative of the Optionee may exercise this Stock Option to the extent provided herein
in the event of the Optionee’s death. 

  
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 5. Miscellaneous Provisions. 

(a) Equitable Relief. The parties hereto agree and declare that legal remedies may be inadequate to enforce the provisions of this
Agreement and that equitable relief, including specific performance and injunctive relief, may be used to enforce the provisions of this Agreement. 

(b) Adjustments for Changes in Capital Structure. If, as a result of any reorganization, recapitalization, reincorporation,
reclassification, stock dividend, stock split, reverse stock split or other similar change in the Common Shares, the outstanding Common Shares are increased or decreased or are exchanged for a different number or kind of securities of the Company,
the restrictions contained in this Agreement shall apply with equal force to additional and/or substitute securities, if any, received by the Optionee in exchange for, or by virtue of his or her ownership of, this Stock Option or Shares acquired
pursuant thereto. 
 (c) Change and Modifications. This Agreement may not be orally changed, modified or terminated, nor shall any
oral waiver of any of its terms be effective. This Agreement may be changed, modified or terminated only by an agreement in writing signed by the Company and the Optionee. 

(d) Governing Law. This Agreement shall be governed by and construed in accordance with the General Corporation Law of the State of
Delaware as to matters within the scope thereof, and as to all other matters shall be governed by and construed in accordance with the internal laws of State of Delaware, without regard to conflict of law principles that would result in the
application of any law other than the law of the State of Delaware. 
 (e) Headings. The headings are intended only for convenience
in finding the subject matter and do not constitute part of the text of this Agreement and shall not be considered in the interpretation of this Agreement. 

(f) Saving Clause. If any provision(s) of this Agreement shall be determined to be illegal or unenforceable, such determination shall
in no manner affect the legality or enforceability of any other provision hereof. 
 (g) Notices. All notices, requests, consents and
other communications shall be in writing and be deemed given when delivered personally, by telex or facsimile transmission or when received if mailed by first class registered or certified mail, postage prepaid. Notices to the Company or the
Optionee shall be addressed as set forth underneath their signatures below, or to such other address or addresses as may have been furnished by such party in writing to the other. 

(h) Benefit and Binding Effect. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their
respective successors, permitted assigns, and legal representatives. The Company has the right to assign this Agreement, and such assignee shall become entitled to all the rights of the Company hereunder to the extent of such assignment. 

  
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 (i) Counterparts. For the convenience of the parties and to facilitate execution, this
Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same document. 

(j) Integration. This Agreement, the Grant Notice and the Plan constitute the entire agreement between the parties with respect to this
Stock Option and supersede all prior agreements and discussions between the parties concerning such subject matter. 
 (k) Further
Assurances. The Optionee will do, execute, acknowledge and deliver or cause to be done, executed, acknowledged and delivered such further documents, assurances or things, and secure all necessary consents and authorizations, as may be reasonably
requested by the Company and/or its registrar and transfer agent for the more complete and perfect observances and performance of the terms of this Agreement. 

6. Dispute Resolution. 

(a) Except as provided below, any dispute arising out of or relating to the Plan or this Stock Option, this Agreement, or the breach,
termination or validity of the Plan, this Stock Option or this Agreement, shall be finally settled by binding arbitration conducted expeditiously in accordance with the J.A.M.S./Endispute Comprehensive Arbitration Rules and Procedures (the
“J.A.M.S. Rules”). The arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. Sections 1-16, and judgment upon the award rendered by the arbitrators may be entered by any court having jurisdiction thereof. The place
of arbitration shall be The Commonwealth of Massachusetts. 
 (b) The arbitration shall commence within 60 days of the date on which a
written demand for arbitration is filed by any party hereto. In connection with the arbitration proceeding, the arbitrator shall have the power to order the production of documents by each party and any third-party witnesses. In addition, each party
may take up to three depositions as of right, and the arbitrator may in his or her discretion allow additional depositions upon good cause shown by the moving party. However, the arbitrator shall not have the power to order the answering of
interrogatories or the response to requests for admission. In connection with any arbitration, each party to the arbitration shall provide to the other, no later than seven business days before the date of the arbitration, the identity of all
persons that may testify at the arbitration and a copy of all documents that may be introduced at the arbitration or considered or used by a party’s witness or expert. The arbitrator’s decision and award shall be made and delivered within
six months of the selection of the arbitrator. The arbitrator’s decision shall set forth a reasoned basis for any award of damages or finding of liability. The arbitrator shall not have power to award damages in excess of actual compensatory
damages and shall not multiply actual damages or award punitive damages, and each party hereby irrevocably waives any claim to such damages. 

(c) The Company, the Optionee, each party to the Agreement and any other holder of Shares issued pursuant to this Agreement (each, a
“Party”) covenants and agrees that 

  
 6 








 
such party will participate in the arbitration in good faith. This Section 6 applies equally to requests for temporary, preliminary or permanent injunctive relief, except that in the case of
temporary or preliminary injunctive relief any Party may proceed in court without prior arbitration for the limited purpose of avoiding immediate and irreparable harm. 

(d) Each Party (i) hereby irrevocably submits to the jurisdiction of any United States District Court of competent jurisdiction for the
purpose of enforcing the award or decision in any such proceeding, (ii) hereby waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally
to the jurisdiction of the above named courts, that its property is exempt or immune from attachment or execution (except as protected by applicable law), that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the
suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court, and (iii) hereby waives and agrees not to seek any review by any court of any other jurisdiction which may be
called upon to grant an enforcement of the judgment of any such court. Each Party hereby consents to service of process by registered mail at the address to which notices are to be given. Each Party agrees that its, his or her submission to
jurisdiction and its, his or her consent to service of process by mail is made for the express benefit of each other Party. Final judgment against any Party in any such action, suit or proceeding may be enforced in other jurisdictions by suit,
action or proceeding on the judgment, or in any other manner provided by or pursuant to the laws of such other jurisdiction. 
 [SIGNATURE
PAGE FOLLOWS] 

  
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 The foregoing Agreement is hereby accepted and the terms and conditions thereof hereby agreed to
by the undersigned as of the date first above written. 
  

			
	NORTHERN POWER SYSTEMS CORP.
		
	By:	 	  

		 	Name:
		 	Title:
	
	Address:
	
	29 Pitman Road
	Barre, VT 05641


 The undersigned hereby acknowledges receiving and reviewing a copy of the Plan and understands that this Stock Option is
subject to the terms of the Plan and of this Agreement. This Agreement is hereby accepted, and the terms and conditions of the Plan, the Grant Notice and this Agreement, SPECIFICALLY INCLUDING THE ARBITRATION PROVISIONS SET FORTH IN SECTION 6 OF
THIS AGREEMENT, are hereby agreed to, by the undersigned as of the date first above written. 
  

	
	OPTIONEE:
	
	  

	Name:
	
	Address:
	
	  

	
	  

	
	  




  
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 Appendix A 

STOCK OPTION EXERCISE NOTICE 
  

	
	Northern Power Systems Corp.
	Attention: [                    ]
	  

	  


 Pursuant to the terms of the grant notice and stock option agreement between the undersigned and Northern
Power Systems Corp. (the “Company”) dated                     (the “Agreement”) under the Northern Power Systems Cop. 2014 Stock
Option and Incentive Plan, I, [Insert Name]                    , hereby [Circle One] partially/fully exercise such option by including herein payment
in the amount of $         representing the purchase price for [Fill in number of Shares]                 Shares. I have chosen
the following form(s) of payment: 
  

							
	 ̈	  	1.	  	Cash
	 ̈	  	2.	  	Certified or bank check payable to Northern Power Systems Corp.
	 ̈	  	3.	  	Other (as referenced in the Agreement and described in the Plan (please describe))
		  		  	  
	 	.

 In connection with my exercise of the option as set forth above, I hereby represent and warrant to the Company
as follows: 
 (i) I am purchasing the Shares for my own account for investment only, and not for resale or with a view to
the distribution thereof. 
 (ii) I have had such an opportunity as I have deemed adequate to obtain from the Company such
information as is necessary to permit me to evaluate the merits and risks of my investment in the Company and have consulted with my own advisers with respect to my investment in the Company. 

(iii) I have sufficient experience in business, financial and investment matters to be able to evaluate the risks involved in
the purchase of the Shares and to make an informed investment decision with respect to such purchase. 
 (iv) I can afford a
complete loss of the value of the Shares and am able to bear the economic risk of holding such Shares for an indefinite period of time. 

(v) I understand that the Shares may not be registered under the Securities Act of 1933 (it being understood that the Shares
are being issued and sold in reliance on the exemption provided in Rule 701 thereunder) or any applicable state securities or “blue sky” laws and may not be sold or otherwise transferred or disposed of in the absence of an effective
registration statement under the Securities Act of 1933 and under any applicable state securities or “blue sky” laws (or exemptions from the 

  
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registration requirement thereof). I further acknowledge that certificates representing Shares will bear restrictive legends reflecting the foregoing and/or that book entries for uncertificated
Shares will include similar restrictive notations. 
 (vi) I have read and understand the Plan and acknowledge and agree that
the Shares are subject to all of the relevant terms of the Plan. 
  

	
	Sincerely yours,
	
	  

	Name:
	
	Address:
	
	  

	
	  

	
	  




  
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