Exhibit 10.1


 


CATALYTICA ENERGY SYSTEMS, INC.


1995 STOCK PLAN


AMENDMENT TO STOCK OPTION AGREEMENTS


 


The outstanding stock option agreements (the “Prior Agreements”) under
the Catalytica Energy Systems, Inc. (the “Company”) 1995 Stock Plan (the “Plan”)
for options with an exercise price equal to or in excess of $1.75 by and
between the Company and [Executive or
Director Name] (the “Optionee”) are hereby amended as follows:


 


1.             Vesting
Acceleration.  The vesting provisions
set forth in the Prior Agreements are amended to include the following:


 


“Notwithstanding anything in this Agreement to the contrary, all
unvested options with an exercise price equal to or greater than $1.75 (the “Accelerated
Options”) shall become vested and exercisable as of November 17, 2005.”


 


2.             Transfer
Restrictions.  Except for the escrow
described in Section 3, none of the shares subject to the Accelerated
Options (the “Restricted Shares”) nor any beneficial interest therein may be
transferred, encumbered or otherwise disposed of in any way (other than by will
or pursuant to the laws of descent and distribution) until the dates upon which
the Accelerated Options would have otherwise vested in accordance with the
vesting schedule in effect under the Prior Agreements; provided, however,
that the Restricted Shares shall be released from this transfer restriction in
full earlier upon the termination of Optionee’s employment.  If Optionee remains employed by the Company,
then on the vesting dates specified in the Prior Agreements, that number of
Restricted Shares that would have vested on such dates under the Prior
Agreements shall be released from this transfer restriction.


 


3.             Escrow
of Restricted Shares.


 


(a)           To ensure that the
transfer restrictions of this Amendment are enforced, upon exercise of an
Accelerated Option, the Company shall deliver and deposit with the Corporate
Secretary of the Company (the “Escrow Holder”) the share certificates representing
the Restricted Shares.  The Restricted Shares
and stock assignment shall be held by the Escrow Holder, pursuant to the Joint
Escrow Instructions of the Company and Optionee attached hereto as Exhibit A,
until such time as the transfer restrictions expire.


 


(b)           The Escrow Holder shall
not be liable for any act it may do or omit to do with respect to holding the
Restricted Shares in escrow while acting in good faith and in the exercise of
its judgment.


 


(c)           When all or a portion
of the Restricted Shares have been released from the transfer restriction, upon
request the Escrow Holder shall deliver the certificate to the Optionee or to
the Optionee’s brokerage account.


 





















 


(d)           Subject to the terms
hereof, the Optionee shall have all the rights of a shareholder with respect to
the Restricted Shares while they are held in escrow, including without
limitation, the right to vote the Restricted Shares and to receive any cash
dividends declared thereon.  If, from
time to time during the period of transfer restriction, there is (i) any
stock dividend, stock split or other change in the Restricted Shares, or (ii) any
merger or sale of all or substantially all of the assets or other acquisition
of the Company, any and all new, substituted or additional securities to which
the Optionee is entitled by reason of the Optionee’s ownership of the Restricted
Shares shall be immediately subject to this escrow, deposited with the Escrow
Holder and included thereafter as “Restricted Shares” for purposes of this Amendment.


 


4.             Legends.  The share certificate evidencing the Restricted
Shares, if any,  issued hereunder shall
be endorsed with the following legend (in addition to any legend required under
applicable state securities laws):


 


“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS UPON TRANSFER AS SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND
THE SHAREHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.”


 


5.             Option
Agreements.  To the extent not
expressly amended hereby, the Prior Agreements remain in full force and effect.


 


6.             Entire
Agreement.  This Amendment, taken
together with the Prior Agreements (to the extent not expressly amended hereby)
and any duly authorized written or electronic agreement entered into by and
between the Company and the Optionee relating to the stock option grants
evidenced by the Prior Agreements, represent the entire agreement of the
parties, supersede any and all previous contracts, arrangements or
understandings between the parties with respect to the stock option grants
evidenced by the Prior Agreements, and may be amended at any time only by
mutual written agreement of the parties hereto.


 


IN WITNESS WHEREOF, this instrument is executed as of                                              ,
2005.


 


 


	
  CATALYTICA ENERGY SYSTEMS, INC.

  	
  OPTIONEE

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
						



 


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EXHIBIT A


 


JOINT ESCROW INSTRUCTIONS


 


                                         ,
           


 


Corporate Secretary


Catalytica Energy Systems, Inc.


[Address]


 


Dear                        :


 


1.           As Escrow
Agent for both Catalytica Energy Systems, Inc., a Delaware corporation
(the “Company”), and the undersigned purchaser of stock of the Company (the “Purchaser”),
you are hereby authorized and directed to hold the documents delivered to you
pursuant to the terms of that certain Amended Stock Option Agreement (“Agreement”)
between the Company and the undersigned, in accordance with the following
instructions:


 


2.           Purchaser
irrevocably authorizes the Company to deposit with you any certificates
evidencing shares of stock to be held by you hereunder and any additions and
substitutions to said shares as defined in the Agreement.  Purchaser does hereby irrevocably constitute
and appoint you as Purchaser’s attorney-in-fact and agent for the term of this
escrow to execute with respect to such securities all documents necessary or
appropriate to make such securities negotiable and to complete any transaction
herein contemplated, including but not limited to the filing with any
applicable state blue sky authority of any required applications for consent
to, or notice of transfer of, the securities. 
Subject to the provisions of this paragraph 2, Purchaser shall
exercise all rights and privileges of a shareholder of the Company while the
stock is held by you.


 


3.           Upon written
or e-mail request of the Purchaser, you shall deliver to Purchaser or his or
her brokerage account a certificate or certificates representing so many shares
of stock as are not then subject to the transfer restrictions set forth in the
Agreement.  Within 10 business days after
Purchaser ceases to be an employee of the Company, you shall deliver to
Purchaser or his or her brokerage account a certificate or certificates
representing the balance of shares held pursuant to the Agreement.


 


4.           If at the
time of termination of this escrow you should have in your possession any
documents, securities, or other property belonging to Purchaser, you shall
deliver all of the same to Purchaser and shall be discharged of all further
obligations hereunder.


 


5.           Your
duties hereunder may be altered, amended, modified or revoked only by a writing
signed by all of the parties hereto.


 





















 


6.           You shall
be obligated only for the performance of such duties as are specifically set
forth herein and may rely and shall be protected in relying or refraining from
acting on any instrument reasonably believed by you to be genuine and to have
been signed or presented by the proper party or parties.  You shall not be personally liable for any
act you may do or omit to do hereunder as Escrow Agent or as attorney-in-fact
for Purchaser while acting in good faith, and any act done or omitted by you
pursuant to the advice of your own attorneys shall be conclusive evidence of
such good faith.


 


7.           You are
hereby expressly authorized to disregard any and all warnings given by any of
the parties hereto or by any other person or corporation, excepting only orders
or process of courts of law, and are hereby expressly authorized to comply with
and obey orders, judgments or decrees of any court.  In case you obey or comply with any such
order, judgment or decree, you shall not be liable to any of the parties hereto
or to any other person, firm or corporation by reason of such compliance,
notwithstanding any such order, judgment or decree being subsequently reversed,
modified, annulled, set aside, vacated or found to have been entered without
jurisdiction.


 


8.           You shall
not be liable in any respect on account of the identity, authorities or rights
of the parties executing or delivering or purporting to execute or deliver the
Agreement or any documents or papers deposited or called for hereunder.


 


9.           You shall
not be liable for the outlawing of any rights under the statute of limitations
with respect to these Joint Escrow Instructions or any documents deposited with
you.


 


10.           You shall be
entitled to employ such legal counsel and other experts as you may deem
necessary properly to advise you in connection with your obligations hereunder,
may rely upon the advice of such counsel, and may pay such counsel reasonable
compensation therefor.


 


11.           Your
responsibilities as Escrow Agent hereunder shall terminate if you shall cease
to be an officer or agent of the Company or if you shall resign by written
notice to each party.  In the event of
any such termination, the Company shall appoint a successor Escrow Agent.


 


12.           If you
reasonably require other or further instruments in connection with these Joint
Escrow Instructions or obligations in respect hereto, the necessary parties
hereto shall join in furnishing such instruments.


 


13.           It is
understood and agreed that should any dispute arise with respect to the
delivery and/or ownership or right of possession of the securities held by you
hereunder, you are authorized and directed to retain in your possession without
liability to anyone all or any part of said securities until such disputes
shall have been settled either by mutual written agreement of the parties
concerned or by a final order, decree or judgment of a court of competent
jurisdiction after the time for appeal has expired and no appeal has been
perfected, but you shall be under no duty whatsoever to institute or defend any
such proceedings.


 


14.           Any notice
required or permitted hereunder shall be given in writing and shall be deemed
effectively given upon personal delivery or upon deposit in the United States
Post Office, by


 


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registered or certified mail
with postage and fees prepaid, addressed to each of the other parties thereunto
entitled at the following addresses or at such other addresses as a party may
designate by ten days’ advance written notice to each of the other parties
hereto.


 




	
  COMPANY:

  	
  Catalytica Energy Systems, Inc.

  
	
   

  	
  [Address]

  
	
   

  	
   

  
	
  PURCHASER:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  ESCROW
  AGENT:

  	
  Corporate
  Secretary

  
	
   

  	
  Catalytica Energy Systems, Inc.

  
	
   

  	
  [Address]

  






 


15.             By
signing these Joint Escrow Instructions, you become a party hereto only for the
purpose of said Joint Escrow Instructions; you do not become a party to the
Agreement.


 


16.             This
instrument shall be binding upon and inure to the benefit of the parties
hereto, and their respective successors and permitted assigns.


 


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17.             These
Joint Escrow Instructions shall be governed by, and construed and enforced in
accordance with, the internal substantive laws, but not the choice of law
rules, of Delaware.


 


	
   

  	
  Very truly
  yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CATALYTICA
  ENERGY SYSTEMS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PURCHASER:

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Signature

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Print Name

  
	
   

  	
   

  
	
  ESCROW
  AGENT:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Corporate
  Secretary

  	
   

  
				



 


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