Document:

Exhibit
10.2

 

Execution Copy

 

REGISTRATION RIGHTS AGREEMENT

 

REGISTRATION
RIGHTS AGREEMENT (this “Agreement”),
dated as of July 2, 2010, by and between BEACON
POWER CORPORATION, a Delaware corporation, (the “Company”), and ASPIRE CAPITAL FUND, LLC, an Illinois limited liability
company (the “Buyer”).  Capitalized terms used herein and not
otherwise defined herein shall have the respective meanings set forth in the
Common Stock Purchase Agreement by and between the parties hereto, dated as of
the date hereof (as amended, restated, supplemented or otherwise modified from
time to time, the “Purchase Agreement”).

 

WHEREAS:

 

A.            (i) Upon the
terms and subject to the conditions of the Purchase Agreement, the Company has
agreed to issue to the Buyer, and the Buyer has agreed to purchase, up to
Twenty Five Million Dollars ($25,000,000) of the Company’s common stock, par
value $.01 per share (the “Common Stock”)
(the “Purchase Shares”), and (ii)
the Company has agreed to issue to the Buyer such number of  shares of Common Stock as is required
pursuant to Section 4(e) of the Purchase Agreement (the “Commitment Shares”); and

 

B.            To induce the
Buyer to enter into the Purchase Agreement, the Company has agreed to provide
certain registration rights under the Securities Act of 1933, as amended, and
the rules and regulations there under, or any similar successor statute
(collectively, the “1933 Act”),
and applicable state securities laws, relating to the use and, to the extent
necessary and permissible, replacement of its currently effective shelf
registration statement(s).

 

NOW, THEREFORE, in consideration of the
promises and the mutual covenants contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the Company and the Buyer hereby agree as follows:

 

1.             DEFINITIONS.

 

As used in this Agreement, the following terms shall have the following
meanings:

 

a.             “Investor” means the Buyer.

 

b.             “Person” means any person or entity
including any corporation, a limited liability company, an association, a
partnership, an organization, a business, an individual, a governmental or
political subdivision thereof or a governmental agency.

 

c.             “Register,” “registered,” and “registration”
refer to a registration effected by preparing and filing one or more
registration statements of the Company in compliance with the 1933 Act and
pursuant to Rule 415 under the 1933 Act or any successor rule providing for
offering securities on a continuous basis (“Rule
415”), and the declaration or ordering of effectiveness of such
registration statement(s) by the United States Securities and Exchange
Commission (the “SEC”).

 

 

d.             “Registrable Securities” means the Purchase
Shares which have been, or which may from time to time be, issued or issuable to
the Investor upon purchases of the Available Amount under the Purchase
Agreement (without regard to any limitation or restriction on purchases) and
the Commitment Shares issued or issuable to the Investor and any shares of
capital stock issued or issuable with respect to the Purchase Shares, the
Commitment Shares or the Purchase Agreement as a result of any stock split,
stock dividend, recapitalization, exchange or similar event or otherwise,
without regard to any limitation on purchases under the Purchase Agreement.

 

e.             “Registration Statement” means any
registration statement of the Company covering the sale of the Registrable
Securities.

 

2.             REGISTRATION.

 

a.             Mandatory
Registration.  The Company
shall within ten (10) Business Days from the date hereof file with the SEC a
prospectus supplement(s) to its existing Form S-3 Registration
Statement(s).   The Investor and its
counsel shall have a reasonable opportunity to review and comment upon such
prospectus supplement(s) prior to its filing with the SEC.  Investor shall furnish all information
reasonably requested by the Company for inclusion therein.  The Company shall use reasonable best efforts
to keep the Registration Statement effective pursuant to Rule 415 promulgated
under the 1933 Act and available for sales of all of the Registrable Securities
at all times until the earlier of (i) the date as of which the Investor may
sell all of the Registrable Securities without restriction pursuant to Rule 144
promulgated under the 1933 Act (or successor thereto) or (ii) the date on which
(A) the Investor shall have sold all the Registrable Securities and no
Available Amount remains under the Purchase Agreement (the “Registration Period”).  The Registration Statement (including any
amendments or supplements thereto and prospectuses contained therein) shall not
contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein, or necessary to make the statements
therein, in light of the circumstances in which they were made, not misleading.

 

b.             Rule 424
Prospectus.  The Company
shall, as required by applicable securities regulations, from time to time file
with the SEC, pursuant to Rule 424 promulgated under the 1933 Act, the
prospectus and prospectus supplements, if any, to be used in connection with
sales of the Registrable Securities under the Registration Statement.  The Investor and its counsel shall have a
reasonable opportunity to review and comment upon such prospectus prior to its
filing with the SEC. The Investor shall use its reasonable best efforts to
comment upon such prospectus within one (1) Business Day from the date the
Investor receives the final version of such prospectus.

 

c.             Sufficient
Number of Shares Registered.  In the event the number of shares available
under the Registration Statement is insufficient to cover the Registrable
Securities, the Company shall, to the extent necessary and permissible, amend
the Registration Statement or file a new registration statement (a “New Registration Statement”), so as to
cover all of such Registrable Securities as soon as practicable, but in any
event not later than ten (10) Business Days after the necessity therefore
arises.  The Company shall use its
reasonable best efforts to cause such amendment and/or New Registration
Statement to become effective as soon as practicable following the filing
thereof.

 

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3.             RELATED
OBLIGATIONS.

 

With respect to the Registration Statement and whenever any Registrable
Securities are to be registered pursuant to Section 2(b) including on any New
Registration Statement, the Company shall use its reasonable best efforts to
effect the registration of the Registrable Securities in accordance with the
intended method of disposition thereof and, pursuant thereto, the Company shall
have the following obligations:

 

a.             The Company
shall prepare and file with the SEC such amendments (including post-effective
amendments) and supplements to any registration statement and the prospectus
used in connection with such registration statement, which prospectus is to be
filed pursuant to Rule 424 promulgated under the 1933 Act, as may be necessary
to keep the Registration Statement or any New Registration Statement effective
at all times during the Registration Period, and, during such period, comply
with the provisions of the 1933 Act with respect to the disposition of all
Registrable Securities of the Company covered by the Registration Statement or
any New Registration Statement until such time as all of such Registrable
Securities shall have been disposed of in accordance with the intended methods
of disposition by the seller or sellers thereof as set forth in such
registration statement.

 

b.             The Company shall permit the
Investor to review and comment upon the Registration Statement or any New
Registration Statement and all amendments and supplements thereto at least two
(2) Business Days prior to their filing with the SEC, and not file any document
in a form to which Investor reasonably objects. 
The Investor shall use its reasonable best efforts to comment upon the
Registration Statement or any New Registration Statement and any amendments or
supplements thereto within two (2) Business Days from the date the Investor
receives the final version  thereof.  The Company shall furnish to the Investor,
without charge any correspondence from the SEC or the staff of the SEC to the
Company or its representatives relating to the Registration Statement or any
New Registration Statement.

 

c.             Upon request of the Investor,
the Company shall furnish to the Investor, (i) promptly after the same is
prepared and filed with the SEC, at least one copy of such registration
statement and any amendment(s) thereto, including financial statements and
schedules, all documents incorporated therein by reference and all exhibits,
(ii) upon the effectiveness of any registration statement, a copy of the
prospectus included in such registration statement and all amendments and
supplements thereto (or such other number of copies as the Investor may
reasonably request) and (iii) such other documents, including copies of any
preliminary or final prospectus, as the Investor may reasonably request from
time to time in order to facilitate the disposition of the Registrable
Securities owned by the Investor.

 

d.             The Company shall use
reasonable best efforts to (i) register and qualify the Registrable Securities
covered by a registration statement under such other securities or “blue sky”
laws of such jurisdictions in the United States as the Investor reasonably
requests, (ii) prepare and file in those jurisdictions, such amendments
(including post-effective amendments) and supplements to such registrations and
qualifications as may be necessary to maintain the effectiveness thereof during
the Registration Period, (iii) take such other actions as may be necessary to
maintain such registrations and qualifications in effect at all times during
the Registration Period, and (iv) take all other actions reasonably necessary
or advisable to qualify the Registrable Securities for sale in such
jurisdictions; provided, however, that the Company shall not be required in
connection therewith or as a condition

 

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thereto to (x) qualify to do business in any jurisdiction where it
would not otherwise be required to qualify but for this Section 3(d), (y)
subject itself to general taxation in any such jurisdiction, or (z) file a
general consent to service of process in any such jurisdiction.  The Company shall promptly notify the
Investor who holds Registrable Securities of the receipt by the Company of any
notification with respect to the suspension of the registration or
qualification of any of the Registrable Securities for sale under the
securities or “blue sky” laws of any jurisdiction in the United States or its
receipt of actual notice of the initiation or threatening of any proceeding for
such purpose.

 

e.             As promptly as
practicable after becoming aware of such event or facts, the Company shall
notify the Investor in writing of the happening of any event or existence of
such facts as a result of which the prospectus included in any registration
statement, as then in effect, includes an untrue statement of a material fact
or omits to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading, and promptly prepare a supplement or amendment to
such registration statement to correct such untrue statement or omission, and
deliver a copy of such supplement or amendment to the Investor (or such other
number of copies as the Investor may reasonably request).  The Company shall also promptly notify the
Investor in writing (i) when a prospectus or any prospectus supplement or
post-effective amendment has been filed, and when a registration statement or
any post-effective amendment has become effective (notification of such
effectiveness shall be delivered to the Investor by facsimile on the same day
of such effectiveness and by overnight mail), (ii) of any request by the SEC
for amendments or supplements to any registration statement or related
prospectus or related information, and (iii) of the Company’s reasonable
determination that a post-effective amendment to a registration statement would
be appropriate.

 

f.              The Company
shall use its reasonable best efforts to prevent the issuance of any stop order
or other suspension of effectiveness of any registration statement, or the
suspension of the qualification of any Registrable Securities for sale in any
jurisdiction and, if such an order or suspension is issued, to obtain the
withdrawal of such order or suspension at the earliest possible moment and to
notify the Investor of the issuance of such order and the resolution thereof or
its receipt of actual notice of the initiation or threat of any proceeding for
such purpose.

 

g.             The Company shall (i) cause
all the Registrable Securities to be listed on each securities exchange on
which securities of the same class or series issued by the Company are then
listed, if any, if the listing of such Registrable Securities is then permitted
under the rules of such exchange, or (ii) secure designation and quotation of
all the Registrable Securities on a Principal Market (as such term is defined
in the Purchase Agreement). The Company shall pay all fees and expenses in
connection with satisfying its obligation under this Section.

 

h.             The Company
shall cooperate with the Investor to facilitate the timely preparation and
delivery of certificates (not bearing any restrictive legend) representing the
Registrable Securities to be offered pursuant to any registration statement and
enable such certificates to be in such denominations or amounts as the Investor
may reasonably request and registered in such names as the Investor may
request.

 

i.              The Company
shall at all times provide a transfer agent and registrar with respect to its
Common Stock.

 

4

 

j.              If reasonably
requested by the Investor, the Company shall (i) immediately incorporate in a
prospectus supplement or post-effective amendment such information as the
Investor believes should be included therein relating to the sale and
distribution of Registrable Securities, including, without limitation,
information with respect to the number of Registrable Securities being sold,
the purchase price being paid therefore and any other terms of the offering of
the Registrable Securities; (ii) make all required filings of such prospectus
supplement or post-effective amendment as soon as notified of the matters to be
incorporated in such prospectus supplement or post-effective amendment; and
(iii) supplement or make amendments to any registration statement.

 

k.             The Company
shall use its reasonable best efforts to cause the Registrable Securities
covered by any registration statement to be registered with or approved by such
other governmental agencies or authorities as may be necessary to consummate
the disposition of such Registrable Securities.

 

l.              Within one (1)
Business Day after any registration statement required to be filed after the
date hereof which includes the Registrable Securities is ordered effective by
the SEC, the Company shall deliver, and shall cause legal counsel for the
Company to deliver, to the transfer agent for such Registrable Securities (with
copies to the Investor) confirmation that such registration statement has been
declared effective by the SEC in the form attached hereto as Exhibit A.  If requested by the Buyer at any time, the
Company shall require its counsel to deliver to the Buyer a written
confirmation whether or not the effectiveness of a registration statement has
lapsed at any time for any reason (including, without limitation, the issuance
of a stop order) and whether or not the registration statement is current and
available to the Buyer for sale of all of the Registrable Securities.

 

m.            The Company
shall take all other reasonable actions necessary to expedite and facilitate
disposition by the Investor of Registrable Securities pursuant to any
registration statement.

 

4.             OBLIGATIONS OF
THE INVESTOR.

 

a.             The Company
shall notify the Investor in writing of the information the Company reasonably
requires from the Investor in connection with any registration statement hereunder.  The Investor shall furnish to the Company
such information regarding itself, the Registrable Securities held by it and
the intended method of disposition of the Registrable Securities held by it as
shall be reasonably required to effect the registration of such Registrable
Securities and shall execute such documents in connection with such
registration as the Company may reasonably request.

 

b.             The Investor
agrees to cooperate with the Company as reasonably requested by the Company in
connection with the preparation and filing of any registration statement
hereunder.

 

c.             The Investor
agrees that, upon receipt of any notice from the Company of the happening of
any event or existence of facts of the kind described in Section 3(f) or the
first sentence of 3(e), the Investor will immediately discontinue disposition
of Registrable Securities pursuant to any registration statement(s) covering
such Registrable Securities until the Investor’s receipt of the copies of the
supplemented or amended prospectus contemplated by Section 3(f) or the first
sentence of 3(e). Notwithstanding anything to the contrary, the Company shall
cause its transfer agent to promptly deliver shares of Common Stock without any
restrictive legend in accordance with the terms of the Purchase Agreement in
connection with any sale of Registrable Securities with respect to which a

 

5

 

Purchase Notice (as defined in the Purchase Agreement) has been
delivered prior to the Investor’s receipt of a notice from the Company of the
happening of any event of the kind described in Section 3(f) or the first
sentence of 3(e) and for which the Investor has not yet settled.

 

5.             EXPENSES OF
REGISTRATION.

 

All reasonable expenses, other than sales or brokerage commissions,
incurred in connection with registrations, filings or qualifications pursuant
to Sections 2 and 3, including, without limitation, all registration, listing
and qualifications fees, printers and accounting fees, and fees and
disbursements of counsel for the Company, shall be paid by the Company.

 

6.             INDEMNIFICATION.

 

a.             To the fullest extent
permitted by law, the Company will, and hereby does, indemnify, hold harmless
and defend the Investor, each Person, if any, who controls the Investor, the
members, the directors, officers, partners, employees, agents, representatives
of the Investor and each Person, if any, who controls the Investor within the
meaning of the 1933 Act or the Securities Exchange Act of 1934, as amended (the
“1934 Act”) (each, an “Indemnified Person”), against any losses,
claims, damages, liabilities, judgments, fines, penalties, charges, costs,
attorneys’ fees, amounts paid in settlement or expenses, joint or several,
(collectively, “Claims”) incurred
in investigating, preparing or defending any action, claim, suit, inquiry,
proceeding, investigation or appeal taken from the foregoing by or before any
court or governmental, administrative or other regulatory agency, body or the
SEC, whether pending or threatened, whether or not an indemnified party is or
may be a party thereto (“Indemnified Damages”),
to which any of them may become subject insofar as such Claims (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out of
or are based upon: (i) any untrue statement or alleged untrue statement of a
material fact in the Registration Statement, any New Registration Statement or
any post-effective amendment thereto or in any filing made in connection with
the qualification of the offering under the securities or other “blue sky” laws
of any jurisdiction in which Registrable Securities are offered (“Blue Sky Filing”), or the omission or
alleged omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) any untrue
statement or alleged untrue statement of a material fact contained in the final
prospectus (as amended or supplemented, if the Company files any amendment
thereof or supplement thereto with the SEC) or the omission or alleged omission
to state therein any material fact necessary to make the statements made
therein, in light of the circumstances under which the statements therein were
made, not misleading, or (iii) any violation or alleged violation by the
Company of the 1933 Act, the 1934 Act, any other law, including, without
limitation, any state securities law, or any rule or regulation thereunder
relating to the offer or sale of the Registrable Securities pursuant to the
Registration Statement or any New Registration Statement  (the matters in the foregoing clauses (i)
through (iii) being, collectively, “Violations”).  The Company shall reimburse each Indemnified
Person promptly as such expenses are incurred and are due and payable, for any
reasonable legal fees or other reasonable expenses incurred by them in
connection with investigating or defending any such Claim.  Notwithstanding anything to the contrary
contained herein, the indemnification agreement contained in this Section 6(a):
(i) shall not apply to a Claim by an Indemnified Person arising out of or based
upon a Violation which occurs in reliance upon and in conformity with
information furnished in writing to the Company by such Indemnified Person
expressly for use in connection with the preparation of the Registration Statement,
any New Registration Statement or any such amendment thereof or supplement
thereto; (ii) with respect to any superceded

 

6

 

prospectus, shall not inure to the benefit of any such person from whom
the person asserting any such Claim purchased the Registrable Securities that
are the subject thereof (or to the benefit of any person controlling such
person) if the untrue statement or omission of material fact contained in the
superceded prospectus was corrected in the revised prospectus, as then amended
or supplemented, if such revised prospectus was timely made available by the
Company pursuant to Section 3(c) or Section 3(e), and the Indemnified Person
was promptly advised in writing not to use the incorrect prospectus prior to
the use giving rise to a violation and such Indemnified Person, notwithstanding
such advice, used it; (iii) shall not be available to the extent such Claim is
based on a failure of the Investor to deliver or to cause to be delivered the
prospectus made available by the Company, if such prospectus was timely made
available by the Company pursuant to Section 3(c) or Section 3(e); and (iv)
shall not apply to amounts paid in settlement of any Claim if such settlement
is effected without the prior written consent of the Company, which consent
shall not be unreasonably withheld.  Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of the Indemnified Person.

 

b.             In connection
with the Registration Statement or any New Registration Statement, the Investor
agrees to indemnify, hold harmless and defend, to the same extent and in the
same manner as is set forth in Section 6(a), the Company, each of its
directors, each of its officers who signs the Registration Statement or any New
Registration Statement, each Person, if any, who controls the Company within
the meaning of the 1933 Act or the 1934 Act (collectively and together with an
Indemnified Person, an “Indemnified Party”),
against any Claim or Indemnified Damages to which any of them may become
subject, under the 1933 Act, the 1934 Act or otherwise, insofar as such Claim
or Indemnified Damages arise out of or are based upon any Violation, in each
case to the extent, and only to the extent, that such Violation occurs in
reliance upon and in conformity with written information about the Investor set
forth on Exhibit B attached hereto and furnished to the Company by the
Investor expressly for use in connection with such registration statement; and,
subject to Section 6(d), the Investor will reimburse any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such Claim; provided, however, that the indemnity agreement
contained in this Section 6(b) and the agreement with respect to contribution
contained in Section 7 shall not apply to amounts paid in settlement of any
Claim if such settlement is effected without the prior written consent of the
Investor, which consent shall not be unreasonably withheld; provided, further,
however, that the Investor shall be liable under this Section 6(b) for only
that amount of a Claim or Indemnified Damages as does not exceed the net
proceeds to the Investor as a result of the sale of Registrable Securities pursuant
to such registration statement.  Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of such Indemnified Party.

 

c.             Promptly after
receipt by an Indemnified Person or Indemnified Party under this Section 6 of
notice of the commencement of any action or proceeding (including any
governmental action or proceeding) involving a Claim, such Indemnified Person
or Indemnified Party shall, if a Claim in respect thereof is to be made against
any indemnifying party under this Section 6, deliver to the indemnifying party
a written notice of the commencement thereof, and the indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly noticed, to assume
control of the defense thereof with counsel mutually satisfactory to the
indemnifying party and the Indemnified Person or the Indemnified Party, as the
case may be; provided, however, that an Indemnified Person or Indemnified Party
shall have the right to retain its own counsel with the fees and expenses to be
paid by the indemnifying party, if, in the reasonable opinion of counsel
retained by the indemnifying party, the representation by such counsel

 

7

 

of the Indemnified Person or Indemnified Party and the indemnifying
party would be inappropriate due to actual or potential differing interests
between such Indemnified Person or Indemnified Party and any other party represented
by such counsel in such proceeding. The Indemnified Party or Indemnified Person
shall cooperate fully with the indemnifying party in connection with any
negotiation or defense of any such action or claim by the indemnifying party
and shall furnish to the indemnifying party all information reasonably
available to the Indemnified Party or Indemnified Person which relates to such
action or claim.  The indemnifying party
shall keep the Indemnified Party or Indemnified Person fully apprised at all times
as to the status of the defense or any settlement negotiations with respect
thereto.  No indemnifying party shall be
liable for any settlement of any action, claim or proceeding effected without
its written consent, provided, however, that the indemnifying party shall not
unreasonably withhold, delay or condition its consent.  No indemnifying party shall, without the
consent of the Indemnified Party or Indemnified Person, consent to entry of any
judgment or enter into any settlement or other compromise which does not
include as an unconditional term thereof the giving by the claimant or
plaintiff to such Indemnified Party or Indemnified Person of a release from all
liability in respect to such claim or litigation.  Following indemnification as provided for
hereunder, the indemnifying party shall be subrogated to all rights of the
Indemnified Party or Indemnified Person with respect to all third parties,
firms or corporations relating to the matter for which indemnification has been
made.  The failure to deliver written
notice to the indemnifying party within a reasonable time of the commencement
of any such action shall not relieve such indemnifying party of any liability
to the Indemnified Person or Indemnified Party under this Section 6, except to
the extent that the indemnifying party is prejudiced in its ability to defend
such action.

 

d.             The
indemnification required by this Section 6 shall be made by periodic payments
of the amount thereof during the course of the investigation or defense, as and
when bills are received or Indemnified Damages are incurred.

 

e.             The indemnity
agreements contained herein shall be in addition to (i) any cause of action or
similar right of the Indemnified Party or Indemnified Person against the
indemnifying party or others, and (ii) any liabilities the indemnifying party
may be subject to pursuant to the law.

 

7.             CONTRIBUTION.

 

To the extent any indemnification by an indemnifying party is
prohibited or limited by law, the indemnifying party agrees to make the maximum
contribution with respect to any amounts for which it would otherwise be liable
under Section 6 to the fullest extent permitted by law; provided, however,
that: (i) no seller of Registrable Securities guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall
be entitled to contribution from any seller of Registrable Securities who was
not guilty of fraudulent misrepresentation; and (ii) contribution by any seller
of Registrable Securities shall be limited in amount to the net amount of
proceeds received by such seller from the sale of such Registrable Securities.

 

8

 

8.             REPORTS AND
DISCLOSURE UNDER THE SECURITIES ACTS.

 

With a view to making available to the Investor the benefits of Rule
144 promulgated under the 1933 Act or any other similar rule or regulation of
the SEC that may at any time permit the Investor to sell securities of the
Company to the public without registration (“Rule
144”), the Company agrees, at the Company’s sole expense, to:

 

a.             make and keep
current public information available, as such term is understood and defined in
Rule 144;

 

b.             file with the SEC in a
timely manner all reports and other documents required of the Company under the
1934 Act so long as the Company remains subject to such requirements and the
filing of such reports and other documents is required for the provisions of
Rule 144 applicable to the Investor;

 

c.             furnish to the Investor so
long as the Investor owns Registrable Securities, promptly upon request, (i) a
written statement by the Company that it has complied with the current public
information provisions of Rule 144, (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so filed by
the Company, and (iii) such other information as may be reasonably requested to
permit the Investor to sell such securities pursuant to Rule 144 without
registration; and

 

d.             take such additional action
as is requested by the Investor to enable the Investor to sell the Registrable
Securities pursuant to Rule 144, including, without limitation, delivering all
such legal opinions, consents, certificates, resolutions and instructions to
the Company’s Transfer Agent as may be 
requested from time to time by the Investor and otherwise fully
cooperate with Investor and Investor’s broker to effect such sale of securities
pursuant to Rule 144.

 

The Company agrees that
damages may be an inadequate remedy for any breach of the terms and provisions
of this Section 8 and that Investor shall, whether or not it is pursuing any
remedies at law, be entitled to equitable relief in the form of a preliminary
or permanent injunctions, without having to post any bond or other security,
upon any breach or threatened breach of any such terms or provisions.

 

9.             ASSIGNMENT OF REGISTRATION
RIGHTS.

 

The Company shall not assign this Agreement or any rights or
obligations hereunder without the prior written consent of the Investor.  The Investor may not assign its rights under
this Agreement.

 

10.           AMENDMENT OF
REGISTRATION RIGHTS.

 

Provisions of this Agreement may be amended and the observance thereof
may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of the Company
and the Investor.

 

9

 

11.           MISCELLANEOUS.

 

a.             Any notices, consents,
waivers or other communications required or permitted to be given under the
terms of this Agreement must be in writing and will be deemed to have been
delivered:  (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (iii) one (1) Business Day after deposit
with a nationally recognized overnight delivery service, in each case properly
addressed to the party to receive the same. 
The addresses and facsimile numbers for such communications shall be:

 

	
  If to the Company:

  
	
   

  	
  Beacon Power Corporation

  
	
   

  	
  65 Middlesex Road

  
	
   

  	
  Tyngsboro,
  MA 01879

  
	
   

  	
  Phone:
  978-694-9121

  
	
   

  	
  Fax:     978-694-9127

  
	
   

  	
  Attention:  Chief Financial Officer

  
	
   

  	
   

  
	
  With a copy to:

  
	
   

  	
  Edwards Angell Palmer
  & Dodge LLP

  
	
   

  	
  111 Huntington Avenue

  
	
   

  	
  Boston, MA 02199-7613

  
	
   

  	
  Telephone:

  	
  617-239-0100

  
	
   

  	
  Facsimile:

  	
  617-227-4420

  
	
   

  	
  Attention:

  	
  Albert L. Sokol, Esq.

  
	
   

  	
   

  
	
  If to the Investor:

  
	
   

  	
  Aspire Capital Fund, LLC

  
	
   

  	
  155 North Wacker Drive,
  Suite 1600

  
	
   

  	
  Chicago, IL 60606

  
	
   

  	
  Telephone:

  	
  312-658-0400

  
	
   

  	
  Facsimile:

  	
  312-658-4005

  
	
   

  	
  Attention:

  	
  Steven G.  Martin

  

 

or at such other address and/or facsimile number and/or to the
attention of such other person as the recipient party has specified by written
notice given to each other party three (3) Business Days prior to the
effectiveness of such change.  Written
confirmation of receipt (A) given by the recipient of such notice, consent,
waiver or other communication, (B) mechanically or electronically generated by
the sender’s facsimile machine containing the time, date, recipient facsimile
number and an image of the first page of such transmission or (C) provided by a
nationally recognized overnight delivery service, shall be rebuttable evidence
of personal service, receipt by facsimile or receipt from a nationally
recognized overnight delivery service in accordance with clause (i), (ii) or
(iii) above, respectively.  Any party to
this Agreement may give any notice or other communication hereunder using any
other means (including messenger service, ordinary mail or electronic mail),
but no such notice or other communication shall be deemed to have been duly
given unless it actually is received by the party for whom it is intended.

 

10

 

b.             Failure of any
party to exercise any right or remedy under this Agreement or otherwise, or
delay by a party in exercising such right or remedy, shall not operate as a
waiver thereof.

 

c.             The corporate laws of the
State of Delaware shall govern all issues concerning the relative rights of the
Company and its stockholders.  All other
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by the internal laws of the State of
Illinois, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of Illinois or any other jurisdictions)
that would cause the application of the laws of any jurisdictions other than
the State of Illinois.   Each party
hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting the City of Chicago, for the adjudication of any dispute
hereunder or in connection herewith or with any transaction contemplated hereby
or discussed herein, and hereby irrevocably waives, and agrees not to assert in
any suit, action or proceeding, any claim that it is not personally subject to
the jurisdiction of any such court, that such suit, action or proceeding is
brought in an inconvenient forum or that the venue of such suit, action or
proceeding is improper.  Each party
hereby irrevocably waives personal service of process and consents to process
being served in any such suit, action or proceeding by mailing a copy thereof
to such party at the address for such notices to it under this Agreement and
agrees that such service shall constitute good and sufficient service of
process and notice thereof.  Nothing
contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law.  If any
provision of this Agreement shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Agreement in that jurisdiction or
the validity or enforceability of any provision of this Agreement in any other
jurisdiction.  EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES
NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR
IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.

 

d.             This Agreement, and the
Purchase  Agreement constitute the entire
agreement among the parties hereto with respect to the subject matter hereof
and thereof.  There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein and therein.  This Agreement and
the Purchase Agreement supersede all prior agreements and understandings among
the parties hereto with respect to the subject matter hereof and thereof.

 

e.             The headings in
this Agreement are for convenience of reference only and shall not limit or
otherwise affect the meaning hereof.

 

f.              This Agreement
may be executed in identical counterparts, each of which shall be deemed an
original but all of which shall constitute one and the same agreement.  This Agreement, once executed by a party, may
be delivered to the other party hereto by facsimile transmission of a copy of
this Agreement bearing the signature of the party so delivering this Agreement.

 

g.             Each party
shall do and perform, or cause to be done and performed, all such further acts
and things, and shall execute and deliver all such other agreements,
certificates, instruments and documents, as the other party may reasonably
request in order to carry out the intent and accomplish the purposes of this
Agreement and the consummation of the transactions contemplated hereby.

 

11

 

h.             The language
used in this Agreement will be deemed to be the language chosen by the parties
to express their mutual intent and no rules of strict construction will be
applied against any party.

 

i.              This Agreement
is intended for the benefit of the parties hereto and their respective
permitted successors and assigns, and is not for the benefit of, nor may any
provision hereof be enforced by, any other Person.

 

* * * * * *

 

12

 

IN WITNESS WHEREOF, the parties have caused
this Registration Rights Agreement to be duly executed as of day and year first
above written.

 

 

	
   

  	
  THE COMPANY:

  
	
   

  	
   

  
	
   

  	
  BEACON POWER CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James M. Spiezio

  
	
   

  	
  Name:

  	
  James M. Spiezio

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BUYER:

  
	
   

  	
   

  
	
   

  	
  ASPIRE CAPITAL FUND, LLC

  
	
   

  	
  BY: ASPIRE CAPITAL PARTNERS, LLC

  
	
   

  	
  BY: SGM HOLDINGS CORP.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Steven G. Martin

  
	
   

  	
  Name:

  	
  Steven G. Martin

  
	
   

  	
  Title:

  	
  President

  

 

13

 

EXHIBIT A

 

TO REGISTRATION RIGHTS AGREEMENT

 

FORM OF NOTICE OF EFFECTIVENESS

OF REGISTRATION STATEMENT

 

[Date]

 

	
  [TRANSFER AGENT]

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

Re: BEACON POWER CORPORATION

 

Ladies and Gentlemen:

 

We are counsel to BEACON POWER CORPORATION, a Delaware
corporation (the “Company”), and
have represented the Company in connection with that certain Common Stock
Purchase Agreement, dated as of
                  ,
2010 (the “Purchase Agreement”),
entered into by and between the Company and Aspire Capital Fund, LLC (the “Buyer”) pursuant to which the Company has
agreed to issue to the Buyer from time to time, in its discretion, and Buyer
has agreed to purchase, certain shares of the Company’s Common Stock, par value
$.01 per share (the “Common Stock”),
in accordance with the terms of the Purchase Agreement. In connection with the
transactions contemplated by the  Purchase
Agreement, the Company has registered with the U.S. Securities & Exchange
Commission the following shares of Common Stock:

 

(1)           shares of Common Stock to be
issued upon purchase from the Company by the Buyer from time to time in an
amount not to exceed Twenty Five Million Dollars ($25,000,000) (the “Purchase Shares.”).

 

(2)           shares of Common Stock which
shall be issued to the Buyer as a commitment fee (the “Commitment Shares”).

 

Pursuant to the Purchase
Agreement, the Company also has entered into a Registration Rights Agreement,
dated as of
            , 2010,
with the Buyer (the “Registration Rights
Agreement”) pursuant to which the Company agreed, among other
things, to register the Purchase Shares and the Commitment Shares under the
Securities Act of 1933, as amended (the “1933
Act”).  In connection with the
Company’s obligations under the Purchase Agreement and the Registration Rights
Agreement, on
              ,
20    , the Company filed a Registration Statement (File
No. 333-                  )
(the “Registration Statement”)
with the Securities and Exchange Commission (the “SEC”) relating to the sale of the Purchase Shares and the
Commitment Shares.

 

In connection with the foregoing, we advise you that a member of the
SEC’s staff has advised us by telephone that the SEC has entered an order
declaring the Registration Statement effective under the 1933 Act at
           P.M. on
                    ,
20     and we have no knowledge, after telephonic inquiry
of a member of the SEC’s staff, that any stop order suspending its
effectiveness has been issued or that

 

 

any proceedings for that purpose are pending before, or threatened by,
the SEC and the Purchase Shares and the Commitment Shares are available for
sale under the 1933 Act pursuant to the Registration Statement and may be
issued without any restrictive legend.

 

 

	
   

  	
  Very truly yours,

  
	
   

  	
  [Company Counsel]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  CC:        Aspire
  Capital Fund, LLC

  	
   

  

 

 

EXHIBIT B

 

TO REGISTRATION RIGHTS AGREEMENT

 

Information About The Investor Furnished To The
Company By The Investor

Expressly For Use In Connection With The Registration
Statement

 

As of the date of the
Purchase Agreement, Aspire Capital beneficially owned no shares of common stock
of the Company. Steven G. Martin, Erik J. Brown & Christos Komissopoulos
the principals of Aspire Capital, are deemed to be beneficial owners of all of
the shares of common stock owned by Aspire Capital.  Messrs. Martin, Brown & Komissopoulos
have shared voting and investment power over the shares being offered under the
prospectus filed with the SEC in connection with the transactions contemplated
under the Purchase Agreement.  Aspire
Capital is not a licensed broker dealer or an affiliate of a licensed broker
dealer.Exhibit 10.2

 

June 30, 2010

 

Mr. Kent
T. Lucien

Vice
Chairman & Chief Financial Officer

 

Dear
Kent:

 

I want to let you know that President Peter Ho and I, and our fellow
Directors, are most pleased with your leadership and contributions to Bank of
Hawaii.  We are delighted that you are
agreeable to continuing to work with our Bank into 2013.

 

Your understanding of and commitment to our Bank will be a real
positive and we are pleased that you agree to the terms of the attached
Retention Agreement.  We look forward to
your continued leadership.

 

	
   

  	
  Very
  Truly Yours,

  
	
   

  	
   

  
	
   

  	
  /s/
  Allan R. Landon

  
	
   

  	
  Allan
  R. Landon

  
	
   

  	
  Chairman
  and CEO

  

 

 

 

RETENTION AGREEMENT

Between Bank of Hawaii and Kent T. Lucien dated June 25, 2010

 

This
Retention Agreement (“Agreement”) is between Kent T. Lucien (“you”) whose
mailing address is 2038 Ualakaa Street, Honolulu, HI  96822, and Bank of Hawaii Corporation and
Bank of Hawaii (collectively, the “Bank”) at 130 Merchant Street, Honolulu,
Hawaii  96813.  The purpose of this Agreement is to describe
the terms of your retention and transition from employment with the Bank.

 

1.                                       Duties and
Compensation until your Departure Date.  You will continue the position of Vice Chair
and Chief Financial Officer.  You agree
to work diligently in your position (or in any other position to which you may
be placed) through January 31, 2013 (“Separation Date”), at which time you
will be relieved of all duties and responsibilities.  The Bank may advance your Separation Date to
any date before January 31, 2013, or may extend your Separation Date to
any date within six months after January 31, 2013.  Any Separation Date after July 31, 2013
will require mutual agreement of the parties in writing.

 

a.               You will be paid your salary
and benefits through the Separation Date.

 

b.              You will participate in the
Executive Incentive Plan for calendar years 2010, 2011, and 2012, provided you
are employed for the duration of the Performance Period as defined in the
applicable Plan.

 

c.               You will continue to
participate in the 2010 Cash for Equity Program approved by the Bank’s Human
Resources and Compensation Committee.

 

d.              You will not participate in
any other incentive, retention, bonus, or stock plan in 2010, or thereafter,
subsequent to the date of this Agreement.

 

e.               In the event you voluntarily
terminate employment prior to the Separation Date, you will receive only your
salary and vested benefits through the date of your termination of employment.

 

f.                 You acknowledge and agree
that no compensation or other payment except as specified in this Agreement
will be owed to you after the Separation Date.

 

2.                                       Return of Bank
Materials upon Termination of Employment and Resignation from Positions.  On or prior to the Separation Date, you:

 

a.               Will return to the Bank any
information you have about the Bank’s practices, customers, strategies,
procedures, or trade secrets, including but not limited to, customer data,
lists and accounts, growth plans, business plans, and marketing strategies
(collectively, “Bank Information”).  You
will not retain any copies of the Bank Information in any form or medium.

 

b.              You will return any Bank
property you have, including American Express card, keys, cell phone, personal
digital assistant (PDA), badge, or other Bank property and equipment.

 

 

c.               You will resign from any
positions you hold as a director, officer, or other management official of any
Bank affiliate or subsidiary, or as trustee or fiduciary of any Bank benefit
plan or trust, effective on the Separation Date.

 

d.              In the event your employment
is terminated prior to your Separation Date, you will comply with the
requirements listed in this Section 2 of the Agreement as of your
termination date (“Termination Date”).

 

3.                                       Retention
Payment (“Monetary Consideration”).  If you perform your duties to the Bank’s
satisfaction through your Separation Date, (including attaining Performance and
Transition Objectives which shall be deemed to be met unless you are otherwise
notified prior to December 31, 2012) and comply with the requirements in
Sections 1, 2, 3, 6, 7, 8, and 9 and Exhibit “A” of this Agreement, you
will receive a Retention Payment of $425,000.00.

 

a.               The Retention Payment will
be paid by the 60th day following the Separation Date, provided
that you have executed and submitted the Release of claims referenced in Section 6(d) below
and the statutory period during which you are entitled to revoke the Release
has expired before the payment date. 
Failure to timely execute and submit the Section 6(d) Release
will be considered a breach of this Agreement and will result in consequences
including the forfeiture of the Retention Payment.

 

b.              After the Separation Date,
you will no longer be eligible for contributions or benefit accruals under any
of the Bank’s tax-qualified retirement plans or nonqualified deferred
compensation plans.  Any outstanding
equity grants will expire in accordance with the terms of the applicable
agreements.

 

4.                                       Effect of this
Agreement on other Severance Arrangements.

 

a.               Unless your employment is
terminated for “cause” as defined in Section 5 of this Agreement, your
employment will be terminated by way of resignation.  You understand and agree that by resigning,
you are not entitled to benefits under the BOH Separation Benefit Plan or the
Bank’s Basic Staff Severance Plan.  By
acceptance of this Agreement and in consideration of the Monetary Consideration
provided to you under this Agreement, you are waiving and releasing any claim
for benefits under both Plans described in this Section 4a.

 

b.              The Bank’s Change-in-Control
Retention Plan (amended and Restated effective December 17, 2009) entered
into by you and the Bank effective December 22, 2009, shall be deemed to
have been terminated as of your Separation Date.  If a Change-in-Control occurs prior to your
Separation Date and you become entitled to benefits under the Bank’s
Change-in-Control Retention Plan, you will receive the benefits 

 

2

 

under the Change-in-Control
Retention Plan, and will not be entitled to any of the benefits provided under
this Agreement.

 

c.               The Bank makes no
representation to you concerning your possible entitlement to unemployment
insurance benefits, and will truthfully report, should unemployment
compensation authorities ask, the reason(s) causing your termination of
employment.

 

5.                                       When your
Employment may be Terminated for Cause.  You agree and understand that your employment
with the Bank may be terminated for “cause” at any time on or before the
Separation Date.

 

a.               “Cause” is defined to
include:  (1) your violation of the
Bank’s Employee Handbook which includes the Bank’s Code of Business Conduct and
Ethics (the “Handbook”), a current copy of which has been provided to you; (2) your
breach of the terms of this Agreement; or (3) your failure to successfully
complete your transition objectives or to make satisfactory progress toward
your annual performance objectives through the Separation Date, as determined
by the Bank’s Chief Executive Officer or President.  You understand and acknowledge that the
provisions of the Handbook may be changed from time to time between the date on
which you sign this Agreement (“Execution Date”) and the Separation Date, and
you agree that your violation of any of those changed provisions prior to the
Separation Date will constitute grounds for terminating your employment for “cause”.

 

b.              Termination for “cause” may
be with or without notice.  In the event
that you are terminated for “cause”, you will forfeit all Monetary
Consideration that has not been paid to you as of the Termination Date.

 

c.               Your duties under this
Agreement, including the information disclosure restrictions in Section 9
and the release of all claims in Section 6, shall remain in the event you
are terminated for “cause”.  You agree
that the payment to you of salary and benefits and/or other consideration on or
after the Execution Date shall be good and sufficient consideration to require
your adherence to the promises you have made in this Agreement even if you are
terminated for “cause” and forfeit any unpaid or unvested Monetary
Consideration.

 

6.                                       Waiver of any
Claims you may have.  You waive,
release and forego any and all claims that you have or might have through the
Execution Date of this Agreement against the Bank and any of its predecessors,
subsidiaries, related entities, officers, directors, shareholders, agents,
attorneys, employees, successors, or assigns (the “Bank Releasees”), including
without restriction any claims arising from or related to your employment with
the Bank and/or your separation from employment with the Bank.

 

3

 

a.               The released claims include
but are not limited to, claims arising under statutory or common laws in the
United States (including federal, state, or local jurisdictions) or any foreign
country.  The released claims include,
but are not limited to, civil claims under anti-discrimination statutes such as
Title VII of the Civil Rights Act, the federal Age Discrimination in Employment
Act (“ADEA”), and Hawaii’s civil rights laws (Hawaii Revised Statutes Chapters
368 and 378); claims under wage and hour laws; claims under the laws of
contract and tort (such as claims for breach of contract, infliction of
emotional distress, defamation, invasion of privacy, wrongful termination, etc.);
claims based upon the Hawaii Whistleblowers’ Protection Act, Hawaii Revised
Statutes Section 378-61 et. seq.; claims under the Sarbanes-Oxley Act of
2002, including Section 806 (18 U.S.C. Section 1514A) of the
Corporate and Criminal Fraud Accountability Act of 2002 (Title VIII of
Sarbanes-Oxley Act of 2002); and claims for attorneys’ fees and/or costs.  THIS RELEASE COVERS ALL CLAIMS THAT ARE BASED
UPON ANY EVENT THAT OCCURRED THROUGH THE EXECUTION DATE OF THIS AGREEMENT.

 

b.              You acknowledge that (1) you
have been advised to consult with an attorney prior to signing this Agreement
containing this Release, (2) you have been given at least twenty-one (21)
days prior to signing in which to consider this Release, (3) you have been
advised that this Release covers ALL CLAIMS (including employment-related
claims generally and ADEA claims specifically) you might have against the Bank
or the Bank Releasees through the Execution Date; and (4) you have seven (7) days
after signing this Release (“the Revocation Period”) in which to revoke this
Release.

 

c.               You understand that you may
revoke this Agreement by notifying the Bank at any time during the Revocation
Period.  If you elect to revoke this
Release, this Agreement will be null and void and you will not be entitled to
any consideration provided under this Agreement.

 

d.              You agree that you will
execute, upon your Separation Date, a further Release covering claims from the
Execution Date through your Separation Date in the form attached hereto as Exhibit A.  The Release is expressly incorporated into
the Agreement as part of the Agreement. 
Failure to timely execute and submit the Section 6(d) Release
will be considered a breach of this Agreement and will result in consequences
including the forfeiture of the Retention Payment.

 

7.                                       How We will
Respond to Employment Verification Requests.  The Bank and you agree that any inquiries
regarding verification of your employment will be handled through Bank of
Hawaii, Human Resources.  As is its
practice, the Bank’s Human Resources will only release information confirming
your dates of employment and position title to requesters unless we are
required to report further information by law, regulation, or court order.

 

4

 

8.                                       Neither of us
will make Negative Comments about the Other.  The Bank agrees that neither its executive
officers nor its directors will make any disparaging, negative, or derogatory
statements about you.  You agree that you
will not make any disparaging, negative, or derogatory comments about the Bank
or the Bank Releasees.

 

9.                                       Your Agreement
to keep Secrets and not to Compete.  You further agree as follows:

 

a.               Unless required or otherwise
permitted by law, you will not disclose to others or use the Bank Information
or any summary or derivative of that information.

 

b.              You acknowledge that your
services under this Agreement are of a special, unique, unusual, extraordinary,
and intellectual character and that you have access to Bank Information of an
extremely confidential and sensitive nature crucial to the Bank’s success.  You further acknowledge and agree that if you
were to engage in conduct prohibited by this Section 9 of the Agreement,
the Bank would be irreparably harmed.

 

c.               In consideration of your
acknowledgements, our mutual promises, and all benefits you have received or
will receive under this Agreement including but not limited to the Monetary
Consideration, you agree that for the duration of the term of your active
employment by the Bank and for a period of thirty-six (36) full months
following the earlier of your Separation Date or Termination Date (the “Non-Compete
Period”), you will not, either directly or indirectly, engage in or invest in,
own, manage, operate, finance, control, be employed by, work as a consultant or
contractor for, or otherwise be associated with any Financial Institution doing
business in the state of Hawaii; provided, however, that you may purchase or
otherwise acquire up to one percent of any class of securities of any such
Financial Institution (but without otherwise participating in the activities of
such enterprise) if such securities are listed on any national or regional
securities exchange or have been registered under Section 12(g) of
the Securities Exchange Act of 1934. The term “Financial Institution” is
defined as any commercial bank, savings institution, securities brokerage,
mortgage company, insurance broker, or other company or organization that
competes in the state of Hawaii with the Bank or any of its subsidiaries or
related companies or entities (the “Bank or Related Entities”).

 

d.              You agree that for the
duration of the Non-Compete Period, you will not solicit business of the same
or similar type being carried on by the Bank or Related Entities from any
company, person, or entity known by you to be a customer of the Bank or Related
Entities, whether or not you had personal contact with such company, person, or
entity by reason of your employment with the Bank.

 

e.               You agree that for the
duration of the Non-Compete Period, you will not, whether for your own account
or the account of any other person at any time solicit, employ, or otherwise
engage as an employee, independent contractor, or otherwise, any person 

 

5

 

who is an employee of the Bank or in any manner induce or attempt to
induce any employee of the Bank to terminate his or her employment with the
Bank.

 

f.                 You agree to notify the Bank
in writing if you accept employment at any time during the Non-Compete
Period.  You further agree that the Bank
may notify your new employer of the terms of Sections 8, 9 and 11 of this
Agreement and, at the Bank’s election, furnish the employer with a copy of this
Agreement or relevant portions thereof.

 

10.                                 Where Notices are to be Sent.  Any notice required or permitted by this
Agreement shall be in writing sent to the following addresses:  For you, 2038 Ualakaa Street, Honolulu, HI  96822; for the Bank, Bank of Hawaii, Human
Resources #320, P. O. Box 2900, Honolulu, HI 96846-6000.

 

11.                                 Enforcing this Agreement.  To the extent permitted by law, if you breach
any of your obligations under this Agreement, the Bank will be entitled to
recover the benefits paid under this Agreement and to obtain all other relief
provided by law or equity.  You
acknowledge and agree that your breach of Sections 2, 8, or 9, will result in
irreparable harm to the Bank for which it will have not adequate remedy at law
and for which the Bank will be entitled to immediate injunctive relief.

 

12.                                 Interpretation of this
Agreement.  In deciding
any question about the parties’ intent in creating this Agreement, the
following rules will be applied:

 

a.               If any covenant of Section 9
is held by a court to be unreasonable, arbitrary, or against public policy, the
covenant shall be considered to be divisible with respect to scope, time,
and/or geographic area, and enforced to the greatest extent permissible under
law. If any provision of this Agreement is deemed to be unlawful, the provision
will be deemed deleted from this Agreement and the remainder of the Agreement
will continue in effect.

 

b.              The paragraph headings and
other guides in this Agreement, as well as any cover letter or other documents
accompanying it, are only intended to improve the readability of the Agreement,
and not to alter its substance.

 

c.               This Agreement is formed at
Honolulu, Hawaii, and is to be interpreted and enforced under the applicable
federal and Hawaii state laws.

 

d.              This Agreement represents
the complete agreement of the parties and supersedes any and all prior
agreements unless otherwise specified in this Agreement. In consideration for
this new Agreement and the benefits hereunder, you waive all rights and forever
forfeit any benefits under any other agreements unless otherwise specified in
this Agreement.

 

6

 

e.               This Agreement may only be
amended in writing signed by both you and the Bank.

 

f.                 This Agreement is not
intended to be and is not an admission of any fact or wrongdoing or liability
by any of the parties.

 

13.                                 Code Section 409A
Compliance.

 

a.               This Agreement
is intended to meet the requirements of Section 409A of the Internal
Revenue Code of 1986, as amended, and the regulations promulgated and official
regulatory guidance provided thereunder (collectively referred to as the “Code”),
so that amounts payable herein (“Payments”) are not includible in the Employee’s
gross income under Code section 409A(a)(1)(A)and the terms of this Agreement
shall be construed and interpreted in a manner consistent with such intent.

 

b.              Notwithstanding
any provision  in this Agreement to the
contrary, any provision that does not meet the 
Code’s requirements (“Provision”) or any state or federal statute
including any applicable regulatory guidance thereunder, shall be reformed  to satisfy such requirements as long as the
reformation can  be accomplished
without  affecting the Employee’s
Payments in a substantially adverse manner. If in the good faith determination
of the Bank such result cannot be achieved without substantially adversely
affecting the Employee’s Payments, then the Provision shall be treated as void.

 

c.               For purposes of
applying the Code to this Agreement, each separately identified amount to which
the Employee is entitled to under this Agreement shall be treated as a separate
payment.

 

d.              To the extent
permissible under Code section 409A, any series of installment payments under
this Agreement shall be treated as a right to a series of separate payments.

 

e.               The Bank’s
Human Resources and Compensation Committee and/or its delegate shall have the
sole authority to administer and interpret the terms of this Agreement.

 

14.                                 Protection Older Workers
Benefit Act notice.  The
following is required by the Older Workers Benefit Protection Act (“OWBPA”):

 

This
Agreement includes a waiver of any claims you may have under the Age
Discrimination in Employment Act (“ADEA”) through the Execution Date of the
Agreement.  You have up to twenty-one
(21) days from the date of this letter to accept the terms of this Agreement,
although you may accept it at any time within those 21 days.  To properly weigh the advantages and
disadvantages of signing this Agreement and waiving your ADEA claims, you are
advised to consult an attorney about this Agreement 

 

7

 

prior
to signing.  If you want to accept the
Agreement prior to the expiration of the 21 days, you will need to indicate
your waiver of the 21-day consideration period by signing in the space indicated
below.

 

To
accept this Agreement, please date, sign, and return it to the Bank’s Executive
Vice President and Director of Human Resources. 
(An extra copy for your file is provided).  Once you do so, pursuant to the OWBPA, you
will still have an additional seven (7) days in which to revoke your
acceptance.  To revoke, you must send the
Bank’s Executive Vice President and Director of Human Resources a written
statement of revocation by registered mail, return receipt requested.  If you revoke your acceptance of this
Agreement, the Agreement will be void, and you will not receive the Monetary
Consideration provided under this Agreement.

 

BANK
OF HAWAII CORPORATION and

BANK
OF HAWAII

 

 

	
  By:

  	
  /S/
  ALLAN R. LANDON

  	
   

  	
  Date:
  June 30, 2010

  
	
   

  	
  Allan
  R. Landon

  	
   

  	
   

  
	
   

  	
  Chairman &
  Chief Executive Officer

  	
   

  	
   

  

 

 

By
signing this Agreement, I acknowledge that I have had the opportunity to
review it carefully with an attorney of my choice; that I have read and
understand its terms; and that I voluntarily agree to them.

 

	
  Dated:
  June 30, 2010

  	
  /S/
  KENT T. LUCIEN

  
	
   

  	
  Kent
  T. Lucien

  

 

 

Pursuant
to 29 C.F.R. Section 125.22(e)(6), I hereby knowingly and voluntarily
waive the twenty-one (21)  day
pre-execution consideration period set for the in Older Workers Benefit
Protection Act (29 U.S.C. Section 626(f)(1)(F)(i)).

 

 

	
  Dated:
  June 30, 2010

  	
  /S/
  KENT T. LUCIEN

  
	
   

  	
  Kent
  T. Lucien

  

 

8

 

EXHIBIT A

 

[To be executed on or after Separation Date]

 

WAIVER AND RELEASE OF CLAIMS THROUGH SEPARATION DATE

 

I  agree that all applicable terms and
conditions in my Waiver and Release of Claims set forth in Section 6 of
the Agreement dated June 25, 2010 apply with respect to the period of my
employment with the Bank from the Execution Date of the Agreement through my
Separation Date.

 

I
understand that no Retention Payment will be made unless this Section 6(d) Release
is executed and submitted such that the statutory period during which I am
entitled to revoke this Release has expired as of the 60th day following my Separation Date.  Failure to timely execute and submit this Section 6(d) Release
will be considered a breach of the Agreement.

 

 

UNDERSTOOD AND AGREED:

 

 

	
   

  	
   

  	
   

  
	
  Kent
  T. Lucien

  	
   

  	
  Date

  

 

 

Pursuant to 29 C.F.R. § 1625.22(e)(6), I hereby knowingly and
voluntarily waive the twenty-one (21) day pre-execution consideration period
set forth in Older Workers Benefit Protection Act (29 U.S.C.
§ 626(f)(1)(F)(i)).

 

 

	
   

  	
   

  	
   

  
	
  Kent
  T. Lucien

  	
   

  	
  Date

  

 

9

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