Document:

Exhibit

EXHIBIT 10.8

CALPINE CORPORATION

NON-QUALIFIED STOCK OPTION AGREEMENT 
Pursuant to the 2017 Equity Incentive Plan

OPTION granted on May 16, 2017 (the “Grant Date”) by Calpine Corporation, a Delaware corporation (the “Company”), to John B. (Thad) Hill III (the “Grantee”) pursuant to this Non-Qualified Stock Option Agreement (“Stock Option Agreement”).

1.GRANT OF OPTION.  The Company hereby grants to the Grantee the right and option (the “Option”) to purchase, on the terms and subject to the conditions set forth herein and in the Plan (as defined below), up to 15,571 fully paid and nonassessable shares (“Total Shares”) of the Company’s Common Stock, par value $0.001 per share, at the option price of $12.40 per share, being not less than 100% of the Fair Market Value of such Common Stock on the Grant Date (the “Exercise Price”).

The Option is granted pursuant to the Company’s 2017 Equity Incentive Plan (the “Plan”), a copy of which is attached hereto. The Option is subject in its entirety to all the applicable provisions of the Plan as in effect from time to time, which are hereby incorporated herein by reference.  The Option is not intended to qualify as an “incentive stock option” within the meaning of Section 422 of the Code.  Except as otherwise provided herein, or unless the context clearly indicates otherwise, capitalized terms not otherwise defined herein shall have the same definitions as provided in the Plan.
2.PERIOD OF OPTION.  The period of the Option shall commence on the Grant Date and expire on the tenth (10th) anniversary of the Grant Date, subject to earlier termination as set forth in the Plan and this Stock Option Agreement (“Option Period”).  The Option (or any lesser amount thereof) may be exercised from time to time during the Option Period as to the number of Total Shares allowable under Section 3 below and the Plan.

3.EXERCISE OF OPTION.  The Option shall become vested and exercisable as to 100% of the Total Shares on the third anniversary date of the Grant Date, provided the Grantee has been continuously employed by the Company or an Affiliate during the period commencing on the Grant Date and ending on the third anniversary of the Grant Date.  

For purposes of this Stock Option Agreement, continuous employment includes any leave of absence approved by the Company or any Affiliate.
Notwithstanding any other provision herein to the contrary, upon the occurrence of a Change in Control (as defined in the Plan), the Option shall become immediately vested in full.

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Upon full payment of the Exercise Price and satisfaction of all applicable tax obligations, and subject to the applicable terms and conditions of the Plan and the terms and conditions of this Stock Option Agreement, the Company shall cause certificates for the shares purchased hereunder to be delivered to the Grantee or cause a noncertificated book-entry representing such shares to be made to the extent not prohibited by any applicable law or the rules of any stock exchange.

4.  TERMINATION OF OPTION.  Subject to the terms and conditions of the Plan, upon termination of the Grantee’s continuous employment with the Company or an Affiliate, any portion of the Option that is not then vested and exercisable in accordance with Section 3 shall immediately terminate and any portion of the Option that is then vested and exercisable shall remain exercisable until the earlier of (1) three months after the date of termination of employment or (2) the expiration of the Option Period, except as follows.

(i)Death. If the Grantee’s continuous employment with the Company or an Affiliate is terminated by reason of death or if the Grantee dies during the three-month post-termination exercise period described in the preceding sentence, then the Option whether vested or unvested shall become immediately vested and shall remain exercisable until the earlier of one year after the date of death or the expiration of the Option Period.

(ii)Retirement. If the Grantee Retires on or after the one-year anniversary of the Grant Date, then the Option, whether vested or unvested, shall become immediately vested and exercisable and shall remain exercisable until the earlier of the one-year anniversary of the Grantee’s date of Retirement or the expiration of the Option Period.

(iii)Cause. If the Grantee’s continuous employment with the Company or an Affiliate is terminated for Cause, then the Option, whether vested or unvested, shall immediately terminate in its entirety.

5.  SECURITIES ACT REQUIREMENTS.  In addition to the requirements set forth herein and in the Plan, (i) the Option shall not be exercisable in whole or in part, and the Company shall not be obligated to issue any shares of Common Stock subject to the Option, if such exercise and sale or issuance would, in the opinion of counsel for the Company, violate the Securities Act of 1933 (the “1933 Act”) or other Federal or state statutes having similar requirements, as they may be in effect at that time; and (ii) the Option shall be subject to the further requirement that, at any time that the Compensation Committee (the “Committee”), in consultation with counsel for the Company, shall determine, in its discretion, that the listing, registration or qualification of the shares of Common Stock subject to the Option under any securities exchange requirements or under any applicable law, or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition of, or in connection with, the issuance of shares of Common Stock, the Option may not be exercised in whole or in part unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Committee.

It is intended that the shares of Common Stock received upon the exercise of the Option shall have been registered under the 1933 Act. If Grantee is an “affiliate” of the Company, as that term 

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is defined in Rule 144 under the 1933 Act (“Rule 144”), such Grantee may not sell any shares of Common Stock received upon the exercise of the Option except in compliance with Rule 144.  Any certificates representing shares of Common Stock received upon the exercise of the Option issued to an “affiliate” of the Company may bear a legend setting forth such restrictions on the disposition or transfer of said shares as the Company deems appropriate to comply with federal and state securities laws (and if the shares of Common Stock received upon the exercise of the Option are evidenced on a noncertificated basis, such shares shall be subject to similar stop transfer instructions).  The Grantee acknowledges and understands that the Company may not be satisfying the current public information requirement of Rule 144 at the time the Grantee wishes to sell the shares of Common Stock received upon the exercise of the Option or other conditions under Rule 144 which are required of the Company.  If so, the Grantee understands that Grantee will be precluded from selling such securities under Rule 144 even if the one-year holding period (or any modification thereof under the Rule) of said Rule has been satisfied. Prior to the Grantee’s acquisition of the shares of Common Stock, the Grantee acquired sufficient information about the Company to reach an informed knowledgeable decision to acquire such shares.  The Grantee has such knowledge and experience in financial and business matters as to make the Grantee capable of utilizing said information to evaluate the risks of the prospective investment and to make an informed investment decision.  The Grantee is able to bear the economic risk of his or her investment in the shares of Common Stock.  The Grantee agrees not to make, without the prior written consent of the Company, any public offering or sale of the shares of Common Stock received upon the exercise of the Option although permitted to do so pursuant to Rule 144(k) promulgated under the 1933 Act, until all applicable conditions and requirements of Rule 144 (or registration of the shares of Common Stock received upon the exercise of the Option under the 1933 Act) and this Stock Option Agreement have been satisfied.

6.  METHOD OF EXERCISE OF OPTION.  Subject to the provisions of the Plan and Section 4 hereof, the Exercise Price of any Common Stock acquired pursuant to the Option shall be paid, to the extent permitted by applicable statutes and regulations, either (i) in cash or by certified or bank check at the time the Option is exercised or (ii) in the discretion of the Committee, upon such terms as the Committee shall approve, the Exercise Price may be paid:  (A) by delivery to the Company of other Common Stock, duly endorsed for transfer to the Company, with a Fair Market Value on the date of delivery equal to the Exercise Price (or portion thereof) due for the number of shares being acquired, or by means of attestation whereby the Grantee identifies for delivery specific shares of Common Stock that have a Fair Market Value on the date of attestation equal to the Exercise Price (or portion thereof) and receives a number of shares of Common Stock equal to the difference between the number of shares thereby purchased and the number of identified attestation shares of Common Stock (a “Stock for Stock Exchange”); (B) a “cashless” exercise program established with a broker; (C) by reduction in the number of shares of Common Stock otherwise deliverable upon exercise of the Option with a Fair Market Value equal to the aggregate exercise price at the time of exercise, or (D) in any other form of legal consideration that may be acceptable to the Committee.    Notwithstanding the foregoing, during any period for which the Common Stock is publicly traded (i.e., the Common Stock is listed on any established stock exchange or a national market system) an exercise by Grantee that involves or may involve a direct or indirect extension of credit or arrangement of an extension of credit by the Company, directly or indirectly, in violation of Section 402(a) of the Sarbanes-Oxley Act (codified as Section 13(k) of the Exchange Act) shall be prohibited with respect to the Option.

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7.  TRANSFERABILITY.  The Option is not transferable otherwise than by will or pursuant to the laws of descent and distribution, and is exercisable during the Grantee’s lifetime only by the Grantee.

8.  BINDING AGREEMENT.  This Stock Option Agreement shall be binding upon and shall inure to the benefit of any successor or assign of the Company, and, to the extent herein provided, shall be binding upon and inure to the benefit of the Grantee’s beneficiary or legal representatives, as they case may be.

9.  ENTIRE AGREEMENT AND AMENDMENTS.  This Stock Option Agreement, the Plan, and the equity provisions set forth in your employment agreement with the Company, dated May 16, 2017 (the “Employment Agreement”), set forth the entire agreement of the parties with respect to the Option granted hereby. In the event of any conflict or ambiguity between this Stock Option Agreement and the Employment Agreement, the Employment Agreement provisions shall govern.  This Stock Option Agreement may be amended in accordance with Section 23 of the Plan.

10.  ELECTRONIC DELIVERY AND SIGNATURES.  The Company may, in its sole discretion, decide to deliver any documents related to the Option or to participation in the Plan or to future options that may be granted under the Plan by electronic means or to request the Grantee’s consent to participate in the Plan by electronic means.  Grantee hereby consents to receive such documents by electronic delivery and, if requested, to agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.  If the Company establishes procedures of an electronic signature system for delivery and acceptance of Plan documents (including this Stock Option Agreement or any Award Agreement like this Option), the Grantee hereby consents to such procedures and agrees that his or her electronic signature is the same as, and shall have the same force and effect as, his or her manual signature.   

11.  WITHHOLDING OF TAX.  To the extent that the exercise of the Option or the disposition of shares of Common Stock acquired by exercise of the Option results in compensation income to the Grantee for federal, state or local  income or other tax or social security purposes (or results in any taxes of any kind), the Grantee shall pay to the Company at the time of such exercise or disposition such amount of money or, if the Company so determines, shares of Common Stock (or shall make other arrangements in accordance with Section 22 of the Plan), as the Company may require to meet its obligation under applicable tax and other laws or regulations and, if the Grantee fails to do so, the Company is authorized to withhold from any cash or Common Stock remuneration then or thereafter payable to the Grantee, any tax or other amount required to be withheld by reason of such exercise, disposition or resulting compensation income, or the Company may otherwise refuse to issue or transfer any shares otherwise required to be issued or transferred pursuant to the terms hereof.  

12.ADJUSTMENTS/CHANGES IN CAPITALIZATION.  The Option is subject to the adjustment provisions set forth in Section 17 of the Plan.

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13.  Employment Relationship.  Any questions as to whether and when there has been a termination of Grantee’s  employment with the Company or any Affiliate, and the cause of such termination, shall be determined by the Committee, with the advice of the employing corporation (if an Affiliate), and the Committee’s determination shall be final.  Nothing in the Plan or this Stock Option Agreement shall confer upon the Grantee any right to continue to serve the Company or an Affiliate in the capacity in effect at the Grant Date (or otherwise) or at any particular rate of compensation or shall affect the right of the Company or an Affiliate (which right is hereby expressly reserved) to modify or terminate the employment of the Grantee at any time with or without notice and with or without Cause.  The Grantee acknowledges and agrees that any right to exercise the Option is earned only by continuing as an employee of the Company or an Affiliate at the will of the Company or such Affiliate, or satisfaction of any other applicable terms and conditions contained in the Plan and this Stock Option Agreement, and not through the act of being hired, being granted the Option or acquiring shares of Common Stock hereunder.

14.  Notice.  All notices required to be given under this Stock Option Agreement or the Plan shall be in writing and delivered in person or by registered or certified mail, postage prepaid, to the other party, in the case of the Company, at the address of its principal place of business (or such other address as the Company may from time to time specify), or, in the case of the Grantee, at the Grantee’s address set forth in the Company’s records; provided, however, any such notice to the Grantee may be delivered electronically to the Grantee’s email address set forth in the Company’s records.  Each party to this Stock Option Agreement agrees to inform the other party immediately upon a change of address.  All notices shall be deemed delivered when received.

15.  Arbitration.  Any dispute or controversy arising under or in connection with this Stock Option Agreement shall be settled by binding arbitration in Houston, Texas by one arbitrator appointed in the manner set forth by the American Arbitration Association.  Any arbitration proceeding pursuant to this paragraph shall be conducted in accordance with the Employment Dispute Resolution Rules of the American Arbitration Association.  Judgment may be entered on the arbitrators’ award in any court having jurisdiction.

16.  Separability.  If any provision of this Stock Option Agreement is rendered or declared illegal or unenforceable by reason of any existing or subsequently enacted legislation or by the decision of any arbitrator or by decree of a court of last resort, the parties shall promptly meet and negotiate substitute provisions for those rendered or declared illegal or unenforceable to preserve the original intent of this Stock Option Agreement to the extent legally possible, but all other provisions of this Stock Option Agreement shall remain in full force and effect.

17.  Interpretation of the Plan and Option.  In the event there is any inconsistency or discrepancy between the provisions of this Stock Option Agreement and the provisions of the Plan, the provisions of the Plan shall prevail.

18.  Governing Law.  The execution, validity, interpretation, and performance of this Stock Option Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, applied without giving effect to any conflicts-of-law principles, except to the extent pre-empted by federal law.

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IN WITNESS WHEREOF, the Company has caused this Stock Option Agreement to be duly executed by one of its officers thereunto duly authorized, and Grantee has executed this Stock Option Agreement, all as of the day and year first above written.
	
		
	 
	CALPINE CORPORATION 

	 
	 

	 
	/s/ W. THADDEUS MILLER

	 
	W. Thaddeus Miller, Executive Vice President

	 
	Chief Legal Officer and Secretary

	 
	 

	
		
	 
	EMPLOYEE

	 
	 

	 
	/s/ JOHN B. (THAD) HILL III

	 
	John B. (Thad) Hill III

	 
	 

	 
	 

6Exhibit

Exhibit 10.1

FIRST AMENDMENT TO LEASE

THIS FIRST AMENDMENT TO LEASE (this “First Amendment” or this “Amendment”) by and between DCI 1001 MINNEAPOLIS VENTURE, LLC, a Delaware limited liability company (“Landlord”), and SELECT COMFORT CORPORATION, a Minnesota corporation (“Tenant”), is executed as of this 1st day of June, 2017 (the “First Amendment Effective Date”).  

WITNESSETH

WHEREAS, Landlord and Tenant have entered into that certain Lease dated as of October 21, 2016 (the “Lease”) for space in the building commonly known as 1001 3rd Avenue South, Minneapolis, Minnesota 55404 (the “Building”); and,

WHEREAS, the Landlord and the Tenant have agreed to further amend the Lease as more particularly set forth in this First Amendment.

NOW, THEREFORE, for and in consideration of the mutual covenants contained herein and in the Lease, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Landlord and Tenant hereby covenant and agree to amend and modify the Lease as follows:

		
	1.
	DEFINED TERMS.  Unless otherwise defined herein, terms used herein with initial capital letters shall have the same meanings assigned to such terms in the Lease.

		
	2.
	PREMISES.  Section 1.1 (n) is hereby replaced with:

		
	(n)
	Premises shall mean the areas of the Building, as outlined on the floor plan of the Building which is attached as Exhibit “B-1” to this Lease of approximately 238,415 Rentable Square Feet. 

Further, Exhibit B-1 of the Lease is replaced with Exhibit B-1 of this First Amendment.

Further, the Allowance (as defined in Exhibit “E”) shall apply to the newly stated Rentable Sqaure Feet figure listed above. Additionally, there are no changes to Exhibit “E” and all of the statements and provisions provided therein remain in full force and effect.

		
	3.
	RENTABLE SQUARE FEET. Section 1.1 (r) is hereby replaced with:

		
	(r)
	Rentable Square Feet shall mean the Usable Square Feet within the Premises, together with an additional amount representing a portion of the Common Areas, Service Areas and other non-tenant space on floors one (1) through six (6) in the Building.  For purposes of this Lease, the parties have agreed that the Premises shall be deemed to consist of 238,415 Rentable Square Feet on floors one, two,  three, and four and that floors one (1) through six (6) of the Building shall be deemed to consist of 327,844 Rentable Square Feet.  However, both Landlord and Tenant acknowledge that neither of these figures was calculated by measuring the

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Common Areas, Service Areas and other non-tenant spaces in the Building and that neither Landlord nor Tenant shall have a right to demand re-measurement or recalculation of the Rentable Square Feet applicable to the Premises or the Building.

		
	4.
	TENANT’S PROPORTIONATE SHARE. Section 1.1 (v) of the Lease is hereby replaced with:

(v)    Tenant's Proportionate Share shall mean a fraction, the numerator of which is the number of Rentable Square Feet within the Premises, and the denominator of which is the number of Rentable Square Feet on floors one (1) through six (6) of the Building.  Accordingly, the parties acknowledge and agree that Tenant's Proportionate Share under this Lease is 72.7220 percent, as confirmed in Exhibit B-2.

Further, Exhibit B-2 of the Lease is replaced with Exhibit B-2 of this First Amendment.

Additionally, for the sake of clarity, Tenant’s Proportionate Share shall be increased 1.5640 percent to account for additional common areas for which tenant agreed to pay the Tenant Proportionate Share under Exhibit D (1) (c) of the Lease, making the total Tenant Proportionate Share 74.2860 percent, as confirmed in Exhibit B-2.

		
	5.
	BASE RENT.  Section 1.1 (b) is hereby replaced with the following:

    

6.    PROJECTED DELIVERY DATE.  Section 1.1 (p) (i) is hereby deleted from the lease.

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Exhibit 10.1

Additionally, Tenant agrees that as of the date of this Amendment, there has been no Landlord Delay under Section 7 of Exhibit E. 

		
	7.
	FOOD SERVICE OPERATION.  Landlord and Tenant hereby agree that Tenant will directly contract for a food service vendor to operate within the food service common area on Floor 5.  Tenant shall be responsible for any and all costs, and may receive any incentives or income, generated from the operation of the food service business. Notwithstanding the foregoing, Landlord shall remain responsible for delivering the food service common area on Floor 5 in accordance with all applicable federal, state and local codes, including, but not limited to the Americans with Disabilities Act (“ADA”) as part of Improvements and under the Tenant Improvement Allowance (including the $1,100,000 additional contribution by Landlord). Landlord shall review and approve any food service operation contracts prior to execution by Tenant; such approval shall not be unreasonably withheld or delayed.  However, food services vendor must meet insurance requirements, and other risk criteria, as required by Landlord or Landlord’s insurance company from time to time. Tenant further agrees that the food service area will be available to any other tenants of the Building and that the food service operation will operate normal business hours for a Downtown Minneapolis class-A office building, but not less than 7:30am-1:30pm (with break for lunch changeover) on regularly scheduled business days.

		
	8.
	EFFECT OF AMENDMENT.  Except as expressly amended by the provisions hereof, the terms and provisions contained in the Lease shall continue to govern the rights and obligations of the parties; and all provisions and covenants in the Lease shall remain in full force and effect as stated therein, except to the extent specifically modified by the provisions of this First Amendment.  This First Amendment and the Lease shall be construed as one instrument.

		
	 9.
	SEVERABILITY OF PROVISIONS.  A determination that any provision of this First Amendment is unenforceable or invalid shall not affect the enforceability or validity of any other provision hereof, and any determination that the application of any provision of this First Amendment to any person or circumstance is illegal or unenforceable shall not affect the enforceability or validity of such provision as it may apply to any other persons or circumstances.

		
	 10.
	COUNTERPARTS.  This First Amendment may be executed in any number of counterparts with the same effect as if all parties hereto had signed the same document.  All such counterparts shall be construed together and shall constitute one instrument, but in making proof hereof it shall only be necessary to produce one such counterpart. 

		
	11.
	GOVERNING LAW.  The terms and conditions of this First Amendment shall be governed by the applicable laws of the State of Minnesota.

		
	  12.
	INTERPRETATION.  Within this First Amendment, words of any gender shall be held and construed to include any other gender, and words in the singular number shall be held and construed to include the plural, unless the context otherwise requires.  The section headings used herein are intended for reference purposes only and shall not be considered

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Exhibit 10.1

in the interpretation of the terms and conditions hereof.  The parties acknowledge that the parties and their counsel have reviewed and revised this First Amendment and that the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this First Amendment or any exhibits or amendments hereto.

		
	  13.
	SUCCESSORS AND ASSIGNS.  The terms and conditions of this First Amendment shall be binding upon and shall inure to the benefit of the parties hereto, their successors and permitted assigns.

		
	  14.
	TIME OF ESSENCE.  Landlord and Tenant agree that time is of the essence of this First Amendment.

IN WITNESS WHEREOF, Landlord and Tenant have executed this First Amendment as of the day and year first above written.

L A N D L O R D:

DCI 1001 Minneapolis Venture LLC,
a Delaware limited liability company
 

By:     / s / Spencer E. Mullee
Spencer E. Mullee
Chief Operating Officer
Date of Execution: 6-22-17

            
                    

T E N A N T:

SELECT COMFORT CORPORATION
                        
        
By:      / s / David F. Callen
Name: David F. Callen
Title: Chief Financial Officer
Date of Execution: 6-22-17

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Exhibit 10.1

EXHIBIT B-1

To First Amendment to Lease Agreement

PREMISES
            

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Exhibit 10.1

EXHIBIT B-2

To First Amendment to Lease Agreement

TENANT’S PROPORTIONATE SHARE

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