Document:

EXHIBIT 10.1

 

 

THQ INC. MANAGEMENT

 

DEFERRED COMPENSATION PLAN

 

 

Effective January 1, 2005

 

 

TABLE OF CONTENTS

 

	
  ARTICLE
  I

  	
   

  	
  DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
   

  	
  ELIGIBILITY

  	
   

  
	
  2.1

  	
  Eligibility

  	
   

  
	
  2.2

  	
  Commencement of Participation

  	
   

  
	
  2.3

  	
  Cessation of Participation

  	
   

  
	
  2.4

  	
  Cessation of Eligibility

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  	
  DEFERRALS AND CONTRIBUTIONS

  	
   

  
	
  3.1

  	
  Basic
  Deferrals

  	
   

  
	
  3.2

  	
  Bonus Deferrals and
  Performance Based Compensation Deferrals

  	
   

  
	
  3.3

  	
  Discretionary Company Credits

  	
   

  
	
  3.4

  	
  Limitations on Deferrals

  	
   

  
	
  3.5

  	
  No
  Withdrawal

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
   

  	
  VESTING

  	
   

  
	
  4.1

  	
  Vesting of Participants’ Accounts

  	
   

  
	
  4.2

  	
  Vesting Upon Plan Termination

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  V

  	
   

  	
  ACCOUNTS

  	
   

  
	
  5.1

  	
  Accounts

  	
   

  
	
  5.2

  	
  Interest
  Credited to Accounts at Least Monthly

  	
   

  
	
  5.3

  	
  Determination of Interest Rate

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
   

  	
  BENEFIT DISTRIBUTIONS AND ACCOUNT
  WITHDRAWALS

  	
   

  
	
  6.1

  	
  Benefit
  Amount

  	
   

  
	
  6.2

  	
  Timing of Distributions

  	
   

  
	
  6.3

  	
  Method of Distribution

  	
   

  
	
  6.4

  	
  Election of In-Service Distribution Year

  	
   

  
	
  6.5

  	
  Distribution Upon Death of Participant

  	
   

  
	
  6.6

  	
  Distribution Upon Disability of Participant

  	
   

  
	
  6.7

  	
  Financial
  Hardship Withdrawal

  	
   

  
	
  6.8

  	
  Specified Employees

  	
   

  
	
  6.9

  	
  Limitation on Distributions to Covered
  Employees

  	
   

  
	
  6.10

  	
  Tax
  Withholding

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
   

  	
  BENEFICIARIES

  	
   

  
	
  7.1

  	
  Designation of Beneficiary

  	
   

  
	
  7.2

  	
  No
  Designated Beneficiary

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
   

  	
  TRUST OBLIGATION TO PAY BENEFITS

  	
   

  
	
  8.1

  	
  Deferrals Transferred to the Trust

  	
   

  
	
  8.2

  	
  Source of Benefit Payments

  	
   

  
	
  8.3

  	
  Investment Discretion

  	
   

  
	
  8.4

  	
  No
  Secured Interest

  	
   

  
					

 

i

 

	
  ARTICLE IX

  	
   

  	
  PLAN ADMINISTRATION

  	
   

  
	
  9.1

  	
  Committee Powers and Responsibilities

  	
   

  
	
  9.2

  	
  Decisions of the Committee

  	
   

  
	
  9.3

  	
  Indemnification

  	
   

  
	
  9.4

  	
  Claims
  Procedure

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  X

  	
   

  	
  AMENDMENT
  AND TERMINATION

  	
   

  
	
  10.1

  	
  Right to Amend

  	
   

  
	
  10.2

  	
  Amendments to Ensure Proper
  Characterization of Plan

  	
   

  
	
  10.3

  	
  Changes in Law Affecting Taxation of
  Participants

  	
   

  
	
  10.4

  	
  Plan Termination or Plan Suspension

  	
   

  
	
  10.5

  	
  Successor to Company

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XI

  	
   

  	
  MISCELLANEOUS

  	
   

  
	
  11.1

  	
  No
  Assignment

  	
   

  
	
  11.2

  	
  No Secured Interest

  	
   

  
	
  11.3

  	
  Successors

  	
   

  
	
  11.4

  	
  No
  Employment Agreement

  	
   

  
	
  11.5

  	
  Attorneys’
  Fees

  	
   

  
	
  11.6

  	
  Governing
  Law

  	
   

  
	
  11.7

  	
  Entire Agreement

  	
   

  
	
  11.8

  	
  Severability

  	
   

  
					

 

ii

 

THQ INC. MANAGEMENT

DEFERRED COMPENSATION PLAN

 

Effective January 1, 2005

 

The
THQ INC. MANAGEMENT DEFERRED COMPENSATION PLAN (the “Plan”) is adopted
effective as of January 1, 2005, by THQ Inc., a Delaware corporation (the “Company”),
primarily for the purpose of providing deferred compensation for a select group
of management or highly compensated employees of the Company.  Accordingly, it is intended that this Plan be
exempt from the requirements of Parts II, III and IV of Title I of the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”) pursuant to
Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA.  This Plan is intended to be an unfunded,
nonqualified deferred compensation plan. 
Plan participants shall have the status of unsecured creditors of the
Company with respect to the payment of Plan benefits.  This Plan is intended to meet the requirements
of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”)
and any regulations promulgated thereunder.

 

ARTICLE I

 

DEFINITIONS

 

Whenever
used herein, the masculine pronoun shall be deemed to include the feminine, and
the singular to include the plural, unless the context clearly indicates
otherwise, and the following definitions shall govern the Plan:

 

1.1           “Account(s)”
means the book entry account(s) established under the Plan for each Participant
to which are credited the Participant’s Basic Deferrals, Bonus Deferrals, any
Discretionary Company Credits and the Interest with respect thereto.  Account balances shall be reduced by any
distributions made to the Participant or the Participant’s Beneficiary(ies)
therefrom and any charges that may be imposed on such Account(s) pursuant to
the terms of the Plan.  Separate
Subaccounts may be established to which shall be credited a Participant’s
Deferrals for each separate Plan Year, the Discretionary Company Credits, if
any, and the Interest with respect thereto. 
Where Subaccounts have been established, Account shall refer to all of
the Participants’ Subaccounts, collectively, as the context may require.

 

1.2           “Basic
Deferral” means the percentage of a Participant’s annual base salary,
commissions or director fees and retainers, which the Participant elects to
defer pursuant to Article III.

 

1.3           “Benchmark
Fund” shall mean one or more of the mutual funds or contracts selected by the
Committee pursuant to Article V.

 

1.4           “Beneficiary”
means one, some, or all (as the context shall require) of those persons, trusts
or other entities designated by a Participant to receive the undistributed
value of his or her Account following the Participant’s death.

 

1.5           “Benefit(s)”
means the total vested amount credited to a Participant’s Account or
Subaccount.

 

1

 

1.6           “Board
of Directors” or “Board” means the Board of Directors of the Company.

 

1.7           “Bonus
Deferral” means the percentage of a Participant’s bonus and/or Performance
Based Compensation which the Participant elects to defer pursuant to
Article III.

 

1.8           “Code”
means the Internal Revenue Code of 1986, as amended.

 

1.9           “Committee”
means the Deferred Compensation Committee composed of such individuals as may
be appointed by the Board which shall function as the administrator of the
Plan.

 

1.10         “Company”
means THQ Inc., a Delaware corporation, and any successor organization thereto.

 

1.11         “Deferrals”
means that percentage of a Participant’s base salary, bonuses, commissions
and/or director fees or retainer which is deferred pursuant to this Plan.

 

1.12         “Deferral
Subaccount” means the Subaccount to which a Participant’s Deferrals for a
particular year are credited.

 

1.13         “Disability”
means a determination by the insurer under the Company’s long-term disability
insurance policy that the Participant is disabled and eligible for long-term
disability benefits under such policy. 
Notwithstanding the foregoing, should regulations or other Internal
Revenue Service (“IRS”) guidance interpret this definition as not meeting the
minimum requirements of Section 409A of the Code, “Disability” under this Plan
shall automatically and without further action or amendment, be determined to
exist if the Participant is by reason of any medically determinable physical or
mental impairment which can be expected to result in death or can be expected
to last for a continuous period of not less than 12 months, and the Participant
is receiving income replacement benefits for a period of not less than 3 months
under any disability benefit plan for covered employees of the Employer.

 

1.14         “Discretionary
Company Credit” means the amount, if any, of Company credits awarded to a
Participant pursuant to Article III and specifically includes any 401(k)
Match Credits as described in Section 3.3.

 

1.15         “Distribution
Date” means the date on which distribution of a Participant’s Benefits is made
or commenced pursuant to Article VI.

 

1.16         “Effective
Date” means the date on which the Plan shall be first effective, which is
January 1, 2005.

 

1.17         “Election”
means the form on which a Participant (i) elects to make Deferrals
pursuant to Article III,  and
(ii) elects a Distribution Date, and (iii) elects the method by which
his or her Benefits will be distributed. 
The Election shall be in such form as may be prescribed by the
Committee.

 

1.18         “Eligible
Individual” means (i) an employee of the Employer who is a member of the select
group of management and highly compensated employees as more particularly 

 

2

 

described in
Article II and who has been designated by the Committee, in its sole
discretion, as eligible to participate in the Plan and notified of his
eligibility and (ii) members of the Board.

 

1.19         “Employer”
means the Company or a subsidiary thereof that has adopted this Plan.

 

1.20         “Entry
Date” means the first day of any Plan Year and, as to an Eligible Individual,
the date which is thirty (30) days from the date on which such Eligible
Individual is first determined to be eligible to participate in the Plan by the
Committee.

 

1.21         “In-Service
Distribution Year” means the year in which
distribution of a Participant’s Deferral Subaccount is made or commenced
pursuant to Section 6.4.

 

1.22         “Interest”
means the investment return or loss determined in accordance with
Article V which shall be credited to the Participants’ Accounts.

 

1.23         “Interest
Rate” shall have the meaning as set forth in Section 5.3.

 

1.24         “Open
Enrollment Period” means such period as the
Committee may specify which is (i) for the first Plan Year, the period selected
by the Committee which ends no later than December 31, 2004, and (ii) for all
subsequent Plan Years, the period selected by the Committee which ends no later
than the first day of each Plan Year, or, with respect to an Eligible
Individual who first becomes eligible to participate in the Plan during a Plan
Year, the period which ends no later than thirty (30) days after becoming an
Eligible Participant.  Notwithstanding the
foregoing, the Open Enrollment Period for deferrals of Performance Based
Compensation may be different than that for Basic Deferrals and may end no
later than six (6) months prior to the end of the performance period for which
services are to be rendered.

 

1.25         “Participant”
means (i) an Eligible Individual who has elected to participate in the Plan by
executing and submitting an Election to the Committee; (ii) an Eligible
Individual who has ceased active participation in accordance with Section 2.3
and has not received all of the vested Benefits to which he or she is entitled;
or (iii) an Eligible Individual for whom Discretionary Company Credits are
made, regardless of whether such Eligible Individual has executed and submitted
an Election.

 

1.26         “Performance
Based Compensation” means any compensation which may be paid to an Eligible
Individual based on services performed over a period of at least twelve (12)
months, or such other definition as may be required by applicable regulations.

 

1.27         “Plan”
means the THQ Inc. Management Deferred Compensation Plan, effective January 1,
2005, as it may be amended from time to time.

 

1.28         “Plan
Year” means the 12-month period beginning on each January 1 and ending on
the following December 31.

 

1.29         “Retirement”
means the Participant’s termination of Service with the Employer after
obtaining age sixty-five (65).

 

3

 

1.30         “Service” means the Participant’s employment or
service with the Employer on a substantially full-time basis in the capacity of
an employee.  A Participant’s Service
shall include periods of employment or service with any Employer regardless of
whether such Employer has adopted this Plan. 
A Participant’s Service shall not be deemed to have terminated merely
because of a change in the capacity under which the Participant renders Service
to the Company, provided there is no interruption or termination of Participant’s
Service.  A Participant’s Service shall
terminate upon an actual termination of Service, whether by death, Retirement,
Disability, or otherwise.  Subject to the
foregoing, the Committee, in its discretion, shall determine whether
Participant’s Service has terminated and the effect of such termination.

 

1.31         “Specified
Employee” means any Participant who would be considered a “Specified Employee”
as that term is defined in Section 409A(a)(2)(B)(i) of the Code.

 

1.32         “Trust”
means the legal entity created by the Trust Agreement.

 

1.33         “Trust
Agreement” means the trust agreement entered into between the Company and First
American Trust, FSB, effective January 1, 2005, and any amendments thereto.

 

1.34         “Trustee”
means the Trustee named in the Trust Agreement and any duly appointed successor
or successors thereto.

 

1.35         “Year
of Service” means 12 consecutive months of Service.

 

ARTICLE II

 

ELIGIBILITY

 

2.1           Eligibility. 
Eligibility for participation in the Plan shall be limited to a select
group of management (which shall include specifically members of the Board) or
highly compensated employees of the Employer, who are designated by the
Committee, in its sole discretion, as eligible to participate in the Plan.  Eligible Individuals shall be notified as to
their eligibility to participate in the Plan. 
Participation in the Plan is voluntary.

 

2.2           Commencement of Participation.  An Eligible Individual may begin
participation in the Plan upon any Entry Date, subject to the execution and
submission of an Election pursuant to Article III.  Notwithstanding the foregoing, although
members of the Board are Eligible Individuals, the specific initial Entry Date
for participation by members of the Board after the Effective Date shall be
determined by the Committee, in its sole and absolute discretion, and
consequently, no member of the Board may participate in the Plan until such
time as the Committee determines.  In
addition, participation of an Eligible Individual who has not otherwise
commenced participation in the Plan, shall commence when a Discretionary
Company Credit is made to the Account of such Eligible Individual pursuant to
the provisions of Section 3.3.

 

2.3           Cessation of Participation.  Active participation in the Plan shall end
when a Participant’s Service terminates or at such time as a Participant is
notified by the Committee, pursuant to Section 2.4, below, that he or she
is no longer eligible to participate in the Plan.  Upon termination of Service or eligibility, a
Participant shall remain an inactive Participant in

 

4

 

the Plan until all
of the vested Benefits to which he or she is entitled under this Plan have been
paid in full.

 

2.4           Cessation of Eligibility.  The Committee may at any time, and in its
sole discretion, notify any Participant that he or she is not eligible to
participate in the Plan, or is not eligible for Discretionary Company Credits
in any Plan Year.

 

ARTICLE III

 

DEFERRALS AND CONTRIBUTIONS

 

3.1           Basic Deferrals.

 

3.1.1        An
Eligible Individual may elect to reduce his or her annual base salary,
commissions and/or director fees and retainers, as applicable, by the
percentage set forth in a written and signed Election filed with the Committee,
subject to the provisions of this Article III.  The Basic Deferrals shall not be paid to the
Participant, but shall be withheld from such amounts otherwise to be paid to
the Participant and an amount equal to the Basic Deferrals shall be credited to
the Participant’s applicable Deferral Subaccount.

 

3.1.2        The
Election must be filed with the Committee during the Open Enrollment Period for
the Plan Year to which such Election applies. 
Unless regulations or other guidance is provided by the IRS which
specifically authorizes revocation of Elections, each Participant Election
shall be irrevocable.  Unless increased,
decreased or terminated during any subsequent Open Enrollment Period, an
Election shall remain in effect until so changed by the Participant during such
subsequent Open Enrollment Period.

 

3.1.3        Each
Election to make Basic Deferrals shall apply only to such amounts earned after
the effective date of such Election.

 

3.1.4        For
the purpose of determining an Eligible Individual’s Basic Deferrals: (i) “base
salary” shall mean the base salary paid by the Employer, and shall include
severance pay and any other source of income determined by the Committee to be
appropriate, but shall not include, unless specifically authorized by the
Committee, bonuses, overtime, incentive payments, non-monetary awards, auto
allowances and other forms of additional compensation, or any other form of
compensation, whether taxable or non-taxable; (ii) “commissions” shall mean
amounts, if any, earned under the commission policies maintained by the
Employer; and (iii) director fees and retainers shall mean such amounts paid to
directors of the Company pursuant to director compensation policies of the
Company.

 

3.2           Bonus Deferrals and Performance Based
Compensation Deferrals.

 

3.2.1        In
addition to the Basic Deferral Election described above, each Eligible
Individual may elect to defer a percentage of each bonus, including specifically
any Performance Based Compensation, earned in the Plan Year with respect to
which such Bonus and/or Performance Based Compensation Deferral Election is
made by filing a written Election with the Committee, subject to the provisions
of this Article III.  The Bonus
Deferrals and/or Performance Based Compensation Deferrals shall not be paid to
the Participant, but shall be withheld from the

 

5

 

applicable payment
and an amount equal to the Bonus Deferrals and/or Performance Based
Compensation Deferrals, as applicable, shall be credited to the Participant’s
applicable Deferral Subaccount.

 

3.2.2        The
Bonus and/or Performance Based Compensation Deferral Election must be filed
with the Committee during the Open Enrollment Period for the Plan Year to which
the Election applies.  A Bonus and/or
Performance Based Compensation Deferral Election shall remain in effect until
changed or revoked by the Participant during a subsequent Open Enrollment
Period.  The Bonus and/or Performance
Based Compensation Deferral Election may be revoked or changed only during an
Open Enrollment Period and such revocation or change may be prospective only.

 

3.2.3        For
the purposes of determining an Eligible Individual’s Bonus Deferrals: “bonus”
shall mean amounts, if any, payable under the bonus policies maintained by the
Employer.  A Participant’s
Bonus/Performance Based Compensation Deferral Election shall apply to any bonus
or other performance based compensation which is earned in the Plan Year to
which such Election applies, regardless of when the amounts are paid.

 

3.3           Discretionary Company Credits.  A Participant’s Subaccount shall be credited
with Discretionary Company Credits, in such amounts and at such times as the
Company may, in its sole discretion, determine and communicate to the
Participant.  Discretionary Company
Credits shall be based upon the profitability of the Company, the performance
of the Participant, mandatory deferral of any award to a Participant or such
other factors as the Company shall consider appropriate, in its sole
discretion.  In addition, the Company
shall automatically credit, until such time as the Committee determines
otherwise, additional Discretionary Company Credits to the Accounts of
applicable Participants in an amount equal to the lost matching contribution to
the Company’s 401(k) plan which the Participant would have been entitled to
receive but for a reduction required pursuant to applicable nondiscrimination
requirements of the 401(k) plan (the “401(k) Match Credits”).  The Company shall be under no obligation to
continue to make Discretionary Company Credits and may discontinue or change
the amount or method of calculating the amount of such Discretionary Company
Credits at any time.

 

3.4           Limitations on Deferrals.  A Participant’s Deferral Elections shall be
subject to the following:

 

3.4.1        A
Participant must defer a minimum of $5,000 each Plan Year.  This required minimum deferral may be
satisfied by Basic and/or Bonus Deferrals or a combination thereof.  In the event the total amount deferred by a
Participant in a Plan Year is less than the applicable minimum deferral amount,
the Committee may, in its sole discretion, direct the Company to pay the amount
deferred during that Plan Year to the Participant as soon as administratively
feasible after the end of the Plan Year.

 

3.4.2        A
Participant may elect to defer up to a maximum of one hundred percent (100%) of
his or her annual base salary, bonuses, Performance Based Compensation and/or
director fees and retainers.

 

6

 

3.4.3        The
Basic and/or Bonus Deferrals elected by the Participant shall be reduced by the
amount(s), if any, which may be necessary:

 

3.4.3.1     To
satisfy all applicable income and employment taxes withholding and FICA
contributions;

 

3.4.3.2     To
pay all contributions elected by the Participant pursuant to any Employer
benefit plans; and

 

3.4.3.3     To
satisfy all garnishments or other amounts required to be withheld by applicable
law or court order.

 

3.4.4        Notwithstanding
anything in this Plan to the contrary, any withholding or salary deferral
elections made under the Company’s 401(k) plan shall be determined based on the
Participant’s compensation after reduction for the Basic and/or Bonus Deferrals
made under this Plan.

 

3.5           No Withdrawal. 
Except as provided in Section 6.7 below, amounts credited to a
Participant’s Account may not be withdrawn by a Participant and shall be paid
only in accordance with the provisions of this Plan.

 

ARTICLE IV

 

VESTING

 

4.1           Vesting of Participants’ Accounts.

 

4.1.1        Amounts
credited to a Participant’s Deferral Subaccounts shall always be 100% vested.

 

4.1.2        A
Participant shall vest in Discretionary Company Credits, if any, and the
Interest credited thereon in accordance with the schedule specified by the
Company, in its sole discretion, at the time of any Discretionary Company
Credits are awarded.  Notwithstanding the
foregoing, until otherwise changed by the Committee, 401(k) Match Credits shall
become vested in the same manner and pursuant to the same schedule as in effect
under the Company’s 401(k) plan under which such matching contributions were
limited at the time such matching contributions would have been made to the
Company’s 401(k) plan.  Amounts credited
to a Participant’s Discretionary Company Credit Subaccount (including 401(k)
Match Credits) shall be 100% vested upon either the Participant’s death,
Retirement or Disability.

 

4.2           Vesting Upon Plan Termination.  Notwithstanding any other provision in the
Plan to the contrary, a Participant’s Account shall be 100% vested upon the
termination of the Plan.

 

7

 

ARTICLE V

 

ACCOUNTS

 

5.1           Accounts. 
Separate Subaccounts shall be established and maintained for each
Participant.  Each Participant’s
applicable Subaccounts shall be credited with the Participant’s Basic
Deferrals, Bonus Deferrals and Discretionary Company Credits, if any, made for
such Participant.  Participants’ Accounts
shall be credited (debited) with the applicable Interest, as set forth in this
Article V.  Participants’ Accounts
shall be reduced by distributions therefrom and any charges which may be
imposed on the Accounts pursuant to the terms of the Plan.

 

5.2           Interest Credited to Accounts at Least Monthly.  Each Subaccount shall be credited (debited)
monthly, or more frequently as the Committee may specify, in an amount equal to
the Subaccount balance on the first day of the prior month multiplied by the
Interest Rate applicable to such Subaccount.

 

5.3           Determination of Interest Rate.

 

5.3.1        The
Committee shall designate the particular funds or contracts which shall
constitute the Benchmark Funds, and may, in its sole discretion, change or add
to the Benchmark Funds; provided, however, that the Committee shall notify
Participants of any such change prior to the effective date thereof.

 

5.3.2        Each
Participant may select among the Benchmark Funds and specify the manner in
which each of his or her Subaccounts shall be deemed to be invested, solely for
purposes of determining the Participant’s Interest Rate.  Each year’s salary, bonus and/or commission
deferrals may have a separate investment election.  The Committee shall establish and communicate
the rules, procedures and deadlines for making and changing Benchmark Fund
selections.  Company shall have no
obligation to acquire investments corresponding to the Participant’s Benchmark
Fund selections.

 

5.3.3        The
Interest Rate is based on the asset unit value, net of administrative fees and
investment management fees and other applicable fees or charges, of the
Benchmark Fund(s) designated by the Board and other applicable fees or
charges.  The Interest Rate may be
negative if the applicable Benchmark Fund(s) sustain a loss.

 

ARTICLE VI

 

BENEFIT DISTRIBUTIONS AND ACCOUNT WITHDRAWALS

 

6.1           Benefit Amount.  The value of the Participant’s Benefit shall
be equal to the vested value of the Participant’s Subaccount(s) on the last day
of the calendar month prior to the Distribution Date, or such other date as the
Committee may specify, adjusted for Deferrals, Discretionary Company Credits,
and/or withdrawals which have been subsequently credited thereto or made
therefrom prior to the Distribution Date.

 

8

 

6.2           Timing of Distributions.  In accordance with the Participant’s Election
made at the time of the original deferral (or such later Election if
applicable), Benefits shall be paid (or, payments shall commence) as soon as
practicable after the earlier of:

 

6.2.1        The
first day of the month following the end of the month in which a Participant’s
employment with the Employer terminates or February of the year following
termination; or

 

6.2.2        The
In-Service Distribution Year designated by the Participant; or

 

6.2.3        The
date the Committee is notified that a Participant has died or after the
Committee has determined that a Participant has incurred a Disability; or

 

6.2.4        The
date the Committee is notified of a Participant’s Retirement, if so designated
by the Participant in applicable Elections; or

 

6.2.5        The
date of a change in the ownership or effective control of the Company, or in
the ownership of a substantial portion of the assets of the Company
(collectively a “Change in Control”) if so designated by the Participant in applicable
Elections.  The definition of an
applicable Change in Control under the Plan shall be deemed to be amended to
reflect any additional guidance or regulations issued by the IRS.

 

6.3           Method of Distribution.

 

6.3.1        Distribution
Methods.  A Participant’s Benefits
shall be paid in one of the following methods, as specified in his or her most
recent effective Election:

 

6.3.1.1     A
single lump sum payment;

 

6.3.1.2     In
annual installment payments of substantially equal amounts over a period as
provided below:

 

 

	
  Reason for Distribution

  	
   

  	
  Years of
  Service

  	
   

  	
  Installment
  Period

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Termination of 

  Service/Disability/Retirement

  	
   

  	
  5+ Years of Service

  	
   

  	
  5 Years

  
	
   

  	
   

  	
  10+ Years of Service

  	
   

  	
  5/10 Years

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  15+ Years of Service

  	
   

  	
  5/10/15 Years

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  In-Service Distribution Year

  	
   

  	
  N/A

  	
   

  	
  2/3/4/5 Years

  

 

6.3.1.3     A
Participant may amend his or her Election from a single lump sum to
installments by filing an amended Election at least twelve (12) months in
advance of the month of February in the year that the first distribution
specified in the original Election being

 

9

 

amended.  The amended new
distribution date must be in a Plan Year five (5) years after the month of
February in the year of the first distribution specified in the original
Election.  No amendment may accelerate
the date that any distribution would be made from the Plan.

 

6.3.1.4     The
Participant’s method of distribution selected in his or her Election shall
remain in effect for all future similar deferrals until changed or revoked by
the Participant during a subsequent Open Enrollment Period.  The Participant’s method of distribution may
be revoked or changed only during an Open Enrollment Period and such revocation
or change may be prospective only.

 

6.3.2        Failure
to Specify a Form of Distribution or Failure to Qualify for Installment Term
Elected.  If, at the time of his or
her Distribution Date, a Participant fails to elect a form of distribution or
who elects an installment distribution does not satisfy the requirements for
the installment term elected, then such Participant’s Benefits shall be
distributed either (i) in a single lump sum payment (if no form selected) or
(ii) in the case of installments, over the longest installment term for which
the Participant is qualified on his or her Distribution Date.

 

6.3.3        Installment
Amounts.  For purposes of this
Section 6.3, installment distributions shall be paid in substantially
equal annual payments under an installment methodology established by the
Committee.

 

6.3.4        Reemployed
After Installments Begin.  If a
former Participant is reemployed after having begun to receive installment
distributions from the Plan, then such former Participant, upon once again
becoming an Eligible Individual, may begin a new period of participation in the
Plan, provided, however, that the installment distributions previously
commenced will continue to be paid to the Participant over the specified term.

 

6.3.5        Minimum
Account Balance Necessary for Installments. 
Notwithstanding anything to the contrary in Section 6.4, if a
Participant’s Account balance is less than $25,000 at the time elected to begin
installment distributions, the Participant’s Benefit will automatically be
distributed in a single lump sum.

 

6.4           Election of In-Service Distribution Year.

 

6.4.1        Initial
Election.  Upon filing the deferral
Election for any Plan Year, a Participant may specify an In-Service
Distribution Year for the Subaccount to which such Deferrals are credited,
subject to the following:

 

6.4.1.1     A
Participant may elect an In-Service Distribution Year for all of the Benefits
credited to such Subaccount.

 

6.4.1.2     The
In-Service Distribution Year for any Deferral Subaccount must be at least two
(2) years after the end of the Plan Year for which Deferrals to such Subaccount
are made.

 

6.4.1.3     Benefits
shall be paid (or payments shall commence) in February of the In-Service
Distribution Year.

 

10

 

6.4.2        Revocation
or Amendment of Election.  A
Participant who has elected an In-Service Distribution Year may revoke and/or
amend the In-Service Distribution Year Election by filing a revocation or an
amended Election at least twelve (12) months in advance of the month of
February in the In-Service Distribution Year specified in the Election being
revoked or amended.  The amended
In-Service Distribution Year must be in a Plan Year five (5) years after the
month of February in the In-Service Distribution Year specified in the prior
Election or at termination of employment. 
If a Participant revokes an In-Service Distribution Year Election and
does not provide another In-Service Distribution Year, the Participant shall be
deemed to have elected to have the Benefit distributed at termination of
employment.  An In-Service Distribution
Year Election for any Deferral Subaccount may be amended only once.  Nothing in this Section 6.4.2 shall preclude
a Participant from amending his or her Election as to the method of
distribution in accordance with Section 6.3.1.3, above.

 

6.4.3        Termination
Before the Planned Distribution Date. 
If the Participant terminates employment with the Employer before his
In-Service Distribution Year, distribution of the Participant’s Account shall
be made or commenced at the same time and in the same manner as specified in
the Participant’s most recent effective Election.

 

6.4.4        Termination
After Commencement of Installment In-Service Distributions.  Notwithstanding any prior Election, if the
Participant terminates employment with the Employer while receiving installment
In-Service Distributions, distribution of the Participant’s remaining
installments shall continue in the form originally elected for such In-Service
Distribution.

 

6.4.5        Absence
of In-Service Distribution Election. 
If a Participant does not elect an In-Service Distribution Year in his
or her initial Election, or if the Participant revokes an In-Service
Distribution Year Election, the Participant will be deemed to have elected to
have the Benefits credited to the relevant Subaccount distributed upon his or
her termination of employment.

 

6.5           Distribution Upon Death of Participant.  If a Participant dies before his or her
Benefit payments have commenced, then such Participant’s Benefits shall be paid
to his or her designated Beneficiary in a single lump sum cash distribution as
soon as administratively feasible after the Committee is notified of the
Participant’s death and receives evidence satisfactory to it thereof.  If a Participant dies after his or her
Benefit distribution has commenced, his or her remaining Benefits shall be paid
to the deceased Participant’s Beneficiary in a single lump sum cash
distribution as soon as administratively feasible after the Committee is
notified of the Participant’s death and receives evidence satisfactory to it
thereof.

 

6.6           Distribution Upon Disability of Participant.  If a Participant suffers a Disability before
or after his or her Benefit payments have commenced, then such Participant’s
Benefits shall be paid in the optional form of distribution previously selected
by the Participant with respect to termination of Service as soon as
administratively feasible after the Committee is notified of the Participant’s
Disability and receives evidence satisfactory to it thereof.

 

6.7           Financial Hardship Withdrawal.  A Participant may withdraw up to one hundred
percent (100%) of the Benefits credited to his or her Deferral Subaccount(s)
(Discretionary

 

11

 

Company Credits
are not eligible for this hardship withdrawal) as may be required to meet a
sudden unforeseeable financial emergency of the Participant.  Such hardship distribution shall be subject
to the following provisions:

 

6.7.1        The
hardship withdrawal must be necessary to satisfy the unforeseeable emergency
and no more may be withdrawn than is required to relieve the financial need
after taking into account other resources that are reasonably available to the
Participant for this purpose.

 

6.7.2        The
Participant must certify that the financial need cannot be relieved:  (i) through reimbursement or compensation
by insurance or otherwise; (ii) by reasonable liquidation of the
Participant’s assets, to the extent such liquidation would not itself cause an
immediate and heavy financial need; or (iii) by borrowing from commercial
sources on reasonable commercial terms.

 

6.7.3        An
unforeseeable financial emergency is a severe financial hardship to Participant
resulting from a sudden and unexpected illness or accident of Participant or of
a dependent of Participant (as defined in section 152(a) of the Code),
loss of Participant’s property due to casualty, or other similar extraordinary
and unforeseeable circumstances arising as a result of events beyond the
control of Participant.  Neither the need
to pay tuition expenses on behalf of the Participant or the Participant’s
spouse or children nor the desire to purchase a home shall be considered an
unforeseeable emergency.

 

6.7.4        The
Committee, in its sole discretion, shall determine if there is an unforeseeable
financial emergency, if the Participant has other resources to satisfy such
emergency and the amount of the hardship withdrawal that is required to
alleviate the Participant’s financial hardship.

 

6.7.5        Upon
receiving a financial hardship withdrawal, the Participant’s Deferrals will be
discontinued for the remainder of the Plan Year in which a financial hardship
withdrawal occurs.  Such Participants
will, however, be eligible for any Discretionary Company Credits which may be
made to the Plan on their behalf.

 

6.8           Specified Employees.  In the event of a distribution to a Specified
Employee based upon such individual’s termination of Service with the Employer,
no distributions will be made, irrespective of any Election to the contrary,
before the date which is six (6) months after the date of termination of
Service, or if earlier the date of the death of the Specified Employee.

 

6.9           Limitation on Distributions to Covered
Employees.  Notwithstanding any other
provision of this Article VI in the event that the Participant is a “covered
employee” as that term is defined in section 162(m)(3) of the Code, or
would be a covered employee if Benefits were distributed in accordance with his
or her Benefit Distribution Election or early withdrawal request, the maximum
amount which may be distributed from the Participant’s Account in any Plan Year
shall not exceed one million dollars ($1,000,000) less the amount of
compensation paid to the Participant in such Plan Year which is not “performance-based”
(as defined in Code section 162(m)(4)(C)), which amount shall be
reasonably determined by the Committee at the time of the proposed
distribution.  Any amount which is not
distributed to the Participant in a

 

12

 

Plan Year as a
result of this limitation shall be distributed to the Participant in the next
Plan Year, subject to compliance with the foregoing limitations set forth in
this Section 6.9.

 

6.10         Tax Withholding. 
Distribution and withdrawal payments under this Article VI shall be
subject to all applicable withholding requirements for state and federal income
taxes and to any other federal, state or local taxes that may be applicable to
such payments.

 

ARTICLE VII

 

BENEFICIARIES

 

7.1           Designation of Beneficiary.  The Participant shall have the right to
designate on such form as may be prescribed by the Committee, one or more
Beneficiaries to receive any Benefits due under the Plan which may remain
unpaid on the date of the Participant’s death. 
The Participant shall have the right at any time to revoke such
designation and to substitute one or more other Beneficiaries.

 

7.2           No Designated Beneficiary.  If, upon the death of the Participant, there
is no valid Beneficiary designation, the Beneficiary shall be the Participant’s
surviving spouse.  In the event there is
no surviving spouse, then the Participant’s Beneficiary shall be the
Participant’s estate.

 

ARTICLE VIII

 

TRUST OBLIGATION TO PAY BENEFITS

 

8.1           Deferrals Transferred to the Trust.  The Employer may transfer the Deferrals and
Discretionary Company Credits, if any, made by or on behalf of a Participant to
the Trustee to be held pursuant to the terms of the Trust Agreement.

 

8.2           Source of Benefit Payments.  All benefits payable to a Participant
hereunder shall be paid by the Trustee to the extent of the assets held in the
Trust by the Trustee, and by the Employer to the extent the assets in the Trust
are insufficient to pay a Participant’s Benefits as provided under this Plan.

 

8.3           Investment Discretion.  The Benchmark Funds established pursuant to
Section 5.3 shall be for the sole purpose of determining the Interest Rate
to be used for determining the Interest credited to the Participant’s
Account.  Neither the Trustee nor the
Committee shall have any obligation to invest the Participants’ Account in
accordance with his deemed investment directions or in any other investment.

 

8.4           No Secured Interest.  Except as otherwise provided by the Trust
Agreement, the assets of the Trust, shall be subject to the claims of creditors
of the Employer.  Except as provided in
the Trust Agreement, the Participant (or the Participant’s Beneficiary) shall
be a general unsecured creditor of the Employer with respect to the payment of
Benefits under this Plan.

 

13

 

ARTICLE IX

 

PLAN ADMINISTRATION

 

9.1           Committee Powers and Responsibilities.  The Committee shall have complete control of
the administration of the Plan herein set forth with all powers necessary to
enable it properly to carry out its duties in that respect.  Not in limitation, but in amplification of
the foregoing, the Committee shall have the power and authority to:

 

9.1.1        Construe
the Plan and Trust Agreement to determine all questions that shall arise as to
interpretations of the Plan’s provisions including determination of which
individuals are Eligible Individuals, which individuals are Specified Employees
and the determination of the amounts credited to a Participant’s Account, and
the appropriate timing and method of Benefit payments;

 

9.1.2        Establish
reasonable rules and procedures which shall be applied in a uniform and
nondiscriminatory manner with respect to Elections, the establishment of
Accounts and Subaccounts, and all other discretionary provisions of the Plan;

 

9.1.3        Establish
the rules and procedures by which the Plan will operate that are consistent
with the terms of the Plan documents;

 

9.1.4        Establish
the rules and procedures by which the Plan shall determine and pay installment
distributions and in-service distributions;

 

9.1.5        Compile
and maintain all records it determines to be necessary, appropriate or
convenient in connection with the administration of the Plan;

 

9.1.6        Adopt
amendments to the Plan document which are deemed necessary or desirable to
facilitate administration of the Plan and/or to bring these documents into
compliance with all applicable laws and regulations, provided that the
Committee shall not have the authority to adopt any Plan amendment that will
result in substantially increased costs to the Company unless such amendment is
contingent upon ratification by the Board before becoming effective;

 

9.1.7        Employ
such persons or organizations to render service or perform services with
respect to the administrative responsibilities of the Committee under the Plan
as the Committee determines to be necessary and appropriate, including but not
limited to attorneys, accountants, and benefit, financial and administrative
consultants;

 

9.1.8        Select,
review and retain or change the Benchmark Funds which are used for determining
the Interest Rate under the Plan;

 

9.1.9        Direct
the investment of the assets of the Trust;

 

9.1.10      Review
the performance of the Trustee with respect to the Trustee’s duties,
responsibilities and obligations under the Plan and the Trust Agreement;

 

14

 

9.1.11      Take
such other action as may be necessary or appropriate to the management and
investment of the Plan assets.

 

9.2           Decisions of the Committee.  Decisions of the Committee made in good faith
upon any matter within the scope of its authority shall be final, conclusive
and binding upon all persons, including Participants and their legal
representatives or Beneficiaries.  Any
discretion granted to the Committee shall be exercised in accordance with rules
and policies established by the Committee.

 

9.3           Indemnification.  To the extent permitted by law, the Company
shall indemnify each member of the Committee, and any other Employee or member
of the Board with duties under the Plan, against losses and expenses (including
any amount paid in settlement) reasonably incurred by such person in connection
with any claims against such person by reason of such person’s conduct in the
performance of duties under the Plan, except in relation to matters as to which
such person has acted fraudulently or in bad faith in the performance of
duties.  Notwithstanding the foregoing,
the Company shall not indemnify any person for any expense incurred through any
settlement or compromise of any action unless the Company consents in writing
to the settlement or compromise.

 

9.4           Claims Procedure.  Benefits shall be provided
from this Plan through procedures initiated by the Committee, and the
Participant need not file a claim. 
However, if a Participant or Beneficiary believes he or she is entitled
to a Benefit different from the one received, then the Participant or
Beneficiary may file a claim for the Benefit by writing a letter to the
Committee.

 

9.4.1        If
any claim for Benefits under the Plan is wholly or partially denied, the
claimant shall be given notice in writing of such denial within 90 days of the
date the letter claiming benefits is received by the Committee.  If special circumstances require an extension
of time, written notice of the extension shall be furnished to the claimant
within the initial 90-day period.

 

9.4.2        Notice
of the denial shall set forth the following information: (a) the specific
reason or reasons for the denial; (b) specific reference to pertinent Plan
provisions on which denial is based; (c) a description of any additional
material or information necessary for the claimant to perfect the claim and an
explanation of why such material or information is necessary; (d) an
explanation that a full review by the Committee of the decision denying the
claim may be requested by the claimant or his or her authorized representative
by filing with the company, within 60 days after such notice has been received,
a written request for such review; and (e) if such request is so filed, the
claimant or his or her authorized representative may review pertinent documents
and submit issues and comments in writing within the same 60 day period
specified in the preceding subparagraph.

 

9.4.3        The
decision of the Committee upon review shall be made promptly, and not later
than 60 days after the Committee’s receipt of the request for review, unless
special circumstances require an extension of time for processing, in which
case the claimant shall be so notified and a decision shall be rendered as soon
as possible, but not later than 120 days after receipt of the request for
review.  If the claim is denied, wholly
or in part, the claimant shall be promptly given a copy of the decision.  The decision shall be in writing and shall
include specific

 

15

 

reasons for the
denial, specific references to the pertinent Plan provisions on which the
denial is based and shall be written in a manner calculated to be understood by
the claimant.  No further legal action
may be initiated claiming benefits under this Plan until the claims procedure
set forth in this Article IX is completed.

 

ARTICLE X

 

AMENDMENT AND TERMINATION

 

10.1         Right to Amend.  The Committee or the Company, by action of
the Board, shall have the right to amend the Plan, at any time and with respect
to any provisions hereof, and all parties hereto or claiming any interest
hereunder shall be bound by such amendment; provided, however, that no such
amendment shall deprive a Participant of a right accrued hereunder prior to the
date of the amendment unless such an amendment is required by applicable law or
deemed necessary to preserve the preferred tax treatment of the Plan.

 

10.2         Amendments to Ensure Proper Characterization of
Plan.  Notwithstanding the provisions
of Section 10.1, the Plan may be amended by the Committee or the Company, by
action of its Board, at any time, retroactively if required, if found
necessary, in the opinion of the Committee or the Board, in order to ensure
that the Plan is characterized as a “top-hat” plan of deferred compensation
maintained for a select group of management or highly compensated employees as
described under ERISA sections 201(2), 301(a)(3), and 401(a)(1), and to conform
the Plan to the provisions and requirements of any applicable law (including
specifically Section 409A of the Code, and other applicable portions of ERISA
and the Code).  No such amendment shall
be considered prejudicial to any interest of a Participant hereunder.

 

10.3         Changes in Law Affecting Taxation of
Participants.  The Plan and any
Election may also be amended as provided in this Section 10.3.

 

10.3.1      Operation.  This Section 10.3 shall become operative upon
the enactment of any change in applicable statutory law or the promulgation by
the IRS of a final regulation or other pronouncement having the force of law,
which statutory law, as changed, or final regulation or pronouncement, as
promulgated, would cause any Participant to include in his or her federal gross
income amounts accrued by the Participant under the Plan on a date (an “Early Taxation
Event”) prior to the date on which such amounts are made available to him or
her hereunder.

 

10.3.2      Affected
Right or Feature Nullified. 
Notwithstanding any other provision of this Plan to the contrary (but
subject to Section 10.3.3 below), as of an Early Taxation Event, the feature or
features of this Plan that would cause the Early Taxation Event shall be null
and void, to the extent, and only to the extent, required to prevent the
Participant from being required to include in his or her federal gross income
amounts accrued by the Participant under the Plan prior to the date on which
such amounts are made available to him or her hereunder.  If only a portion of a Participant’s Account
is impacted by the change in the law, then only such portion shall be subject
to this Section 10.3, with the remainder of the Account not so affected being
subject to such rights and features as if the law were not changed.  If the law only impacts

 

16

 

Participants who have
a certain status with respect to the Employer, then only such Participants
shall be subject to this Section 10.3.

 

10.3.3      Tax
Distribution.  If an Early Taxation
Event is earlier than the date on which the statute, regulation or
pronouncement giving rise to the Early Taxation Event is enacted or
promulgated, as applicable (i.e., if the change in the law is retroactive),
there shall be distributed to each Participant, as soon as practicable
following such date of enactment or promulgation, the amounts that became
taxable on the Early Taxation Event.

 

10.4         Plan Termination or Plan Suspension.  The Company reserves the right to terminate
the Plan and/or its obligation to make further Discretionary Company Credits to
the Plan, by action of its Board.  The Company
also reserves the right to suspend the operation of the Plan for a fixed or
indeterminate period of time, by action of its Board.

 

10.5         Successor to Company.  Any corporation or other business
organization which is a successor to the Company by reason of a consolidation,
merger or purchase of substantially all of the assets of the Company, or any
other Change in Control, shall have the right to become a party to the Plan by
adopting the same by resolution of the entity’s board of directors or other appropriate
governing body.  If, within ninety (90)
days from the effective date of such consolidation, merger or sale of assets,
or Change in Control such new entity does not become a party hereto, as above
provided, the Plan automatically shall be terminated.

 

ARTICLE XI

 

MISCELLANEOUS

 

11.1         No Assignment. 
The right of any Participant, any Beneficiary or any other person to the
payment of any benefits under this Plan shall not be assigned, transferred,
pledged or encumbered.

 

11.2         No Secured Interest.  The obligation of the Company to Participants
under this Plan shall not be funded or otherwise secured, and shall be paid out
of the general assets of the Company. 
Participants are general unsecured creditors of the Company with respect
to the obligations hereunder and shall have no legal or equitable interest in
the assets of the Company, including any assets as the Company may set aside or
reserve against its obligations under this Plan.

 

11.3         Successors. 
This Plan shall be binding upon and inure to the benefit of the
Employee, its successors and assigns and the Participant and his or her heirs,
executors, administrators and legal representatives.

 

11.4         No Employment Agreement.  Nothing contained herein shall be construed
as conferring upon any Participant the right to continue in the employ of the
Employer as an employee.

 

11.5         Attorneys’ Fees.  If the Employer, the Participant, any
Beneficiary, and/or a successor in interest to any of the foregoing, brings
legal action to enforce any of the provisions of this Plan, the prevailing
party in such legal action shall be reimbursed by the other party, the

 

17

 

prevailing party’s
costs of such legal action including, without limitation, reasonable fees of
attorneys, accountants and similar advisors and expert witnesses.

 

11.6         Governing Law. 
This Plan shall be construed in accordance with and governed by the laws
of the State of California.

 

11.7         Entire Agreement.  This Plan constitutes the entire
understanding and agreement with respect to the subject matter contained
herein, and there are no agreements, understandings, restrictions,
representations or warranties among any Participant and the Employer other than
those as set forth or provided for herein.

 

11.8         Severability. 
If any provision of this Plan is held to be invalid, illegal or
unenforceable, such invalidity, illegality, or unenforceability shall not
affect any other provision of this Plan, and the Plan shall be construed and
enforced as if such provision had not been included.  In addition, if such provision is invalid,
illegal or unenforceable due to changes in applicable law, the Company may
amend the Plan, without the consent and without providing any advance notice to
any Participant, as may be necessary or desirable to comply with changes in the
applicable law or financial accounting of deferred compensation plans.

 

IN
WITNESS WHEREOF, this Plan has been adopted by the Company effective as of the
Effective Date.

 

	
   

  	
  THQ INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated:

  	
   

  	
  , 

  	
  2004

  	
  By:

  	
   

  
						

 

18Exhibit 10.1

 

FORM OF WARRANT TO
PURCHASE

 

SHARES OF COMMON STOCK

 

OF

 

SATCON TECHNOLOGY CORPORATION

 

 

Expires December 21, 2009

 

	
  No.: W-C-04-     

  	
  Number of Shares:

  	
   

  
	
  Date of Issuance: December 22, 2004

  	
   

  

 

FOR VALUE RECEIVED, subject to the provisions hereinafter
set forth, the undersigned, SatCon Technology Corporation, a Delaware
corporation (together with its successors and assigns, the “Issuer”),
hereby certifies that                                                       
                                                              or
its registered assigns is entitled to subscribe for and purchase, during the
Term (as hereinafter defined), up to                                                                                                              (                                                   )
shares (subject to adjustment as hereinafter provided) of the duly authorized,
validly issued, fully paid and non-assessable Common Stock of the Issuer, at an
exercise price per share equal to the Warrant Price then in effect, subject,
however, to the provisions and upon the terms and conditions hereinafter set
forth.  Capitalized terms used in this
Warrant and not otherwise defined herein shall have the respective meanings
specified in Section 8 hereof.

 

1.             Term.  The term of this Warrant shall commence on
December 22, 2004 and shall expire at 5:00 p.m., eastern time, on December 21,
2009 (such period being the “Term”).

 

2.             Method of Exercise Payment;
Issuance of New Warrant; Transfer and Exchange.

 

(a)           Time
of Exercise.  The purchase rights
represented by this Warrant may be exercised in whole or in part during the
Term.

 

(b)           Method
of Exercise.  The Holder hereof may
exercise this Warrant, in whole or in part, by the surrender of this Warrant
(with the exercise form attached hereto duly executed) at the principal office
of the Issuer, and only by “cashless exercise” in accordance with the
provisions of subsection (c) of this Section 2.

 

(c)           Cashless
Exercise.  The Holder may exercise
this Warrant only by a cashless exercise and shall receive the number of shares
of Common Stock equal to an amount (as determined below) by surrender of this
Warrant at the principal office of the Issuer together with the properly
endorsed Notice of Exercise in which event the Issuer shall issue to the Holder
a number of shares of Common Stock computed using the following formula:

 

X = Y - (A)(Y)

B

 

Where                                                            X
=          the number of shares of Common
Stock to be issued to the Holder.

 

Y =                              the
number of shares of Common Stock purchasable upon exercise of all

 

 

of the Warrant or,
if only a portion of the Warrant is being exercised, the portion of the Warrant
being exercised.

 

A =                            the
Warrant Price.

 

B =          the Per Share Market Value of one
share of Common Stock.

 

(d)           Issuance of Stock Certificates.  In the event of any exercise of the rights
represented by this Warrant in accordance with and subject to the terms and
conditions hereof, (i) certificates for the shares of Warrant Stock so
purchased shall be dated the date of such exercise and delivered to the Holder
hereof within a reasonable time, not exceeding three (3) Trading Days after
such exercise or, at the request of the Holder, issued and delivered to the
Depository Trust Company (“DTC”) account on the Holder’s behalf via the
Deposit Withdrawal Agent Commission System (“DWAC”) within a reasonable
time, not exceeding three (3) Trading Days after such exercise, and the Holder
hereof shall be deemed for all purposes to be the holder of the shares of
Warrant Stock so purchased as of the date of such exercise and (ii) unless this
Warrant has expired, a new Warrant representing the number of shares of Warrant
Stock, if any, with respect to which this Warrant shall not then have been
exercised (less any amount thereof which shall have been canceled in payment of
the Warrant Price as hereinabove provided) shall also be issued to the Holder
hereof at the Issuer’s expense within such time.  All shares of Warrant Stock received upon
exercise of this Warrant shall be freely tradeable and will not be subject to a
restrictive legend on the certificates evidencing such shares.

 

(e)           Transferability
of Warrant.  This Warrant may be
transferred by a Holder by surrendering this Warrant at the principal office of
the Issuer, properly endorsed (by the Holder executing an assignment in the
form attached hereto) and upon payment of any necessary transfer tax or other
governmental charge imposed upon such transfer. 
If transferred pursuant to this paragraph, this Warrant may be
transferred on the books of the Issuer by the Holder hereof in person or by
duly authorized attorney. This Warrant is exchangeable at the principal office
of the Issuer for Warrants for the purchase of the same aggregate number of
shares of Warrant Stock, each new Warrant to represent the right to purchase
such number of shares of Warrant Stock as the Holder hereof shall designate at
the time of such exchange.  All Warrants
issued on transfers or exchanges shall be dated the Original Issue Date and shall
be identical with this Warrant except as to the name of the Holder or the
number of shares of Warrant Stock, as applicable.

 

(f)            Continuing Rights of Holder.  The Issuer will, at the time of or at any
time after each exercise of this Warrant, upon the request of the Holder
hereof, acknowledge in writing the extent, if any, of its continuing obligation
to afford to such Holder all rights to which such Holder shall continue to be
entitled after such exercise in accordance with the terms of this Warrant, provided
that if any such Holder shall fail to make any such request, the failure shall
not affect the continuing obligation of the Issuer to afford such rights to
such Holder.

 

2

 

3.             Stock Fully Paid; Reservation
and Listing of Shares; Covenants.

 

(a)           Stock
Fully Paid.  The Issuer represents,
warrants, covenants and agrees that all shares of Warrant Stock which may be
issued upon the exercise of this Warrant or otherwise hereunder will, when
issued in accordance with the terms of this Warrant, be duly authorized,
validly issued, fully paid and non-assessable and free from all taxes, liens
and charges created by or through Issuer. 
The Issuer further covenants and agrees that during the period within
which this Warrant may be exercised, the Issuer will at all times have
authorized and reserved for the purpose of the issue upon exercise of this
Warrant a sufficient number of shares of Common Stock to provide for the
exercise of this Warrant.

 

(b)           Reservation.  If any shares of Common Stock required to be
reserved for issuance upon exercise of this Warrant or as otherwise provided
hereunder require registration or qualification with any governmental authority
under any federal or state law before such shares may be so issued, the Issuer
will in good faith use its reasonable best efforts as expeditiously as possible
at its expense to cause such shares to be duly registered or qualified.  If the Issuer shall list any shares of Common
Stock on any securities exchange or market it will, at its expense, list thereon,
maintain and increase when necessary such listing, of, all shares of Warrant
Stock from time to time issued upon exercise of this Warrant or as otherwise
provided hereunder and, to the extent permissible under the applicable
securities exchange rules, all unissued shares of Warrant Stock which are at
any time issuable hereunder, so long as any shares of Common Stock shall be so
listed.  The Issuer will also so list on
each securities exchange or market, and will maintain such listing of, any
other securities which the Holder of this Warrant shall be entitled to receive
upon the exercise of this Warrant if at the time any securities of the same
class shall be listed on such securities exchange or market by the Issuer.

 

(c)           Covenants.  The Issuer shall not by any action including,
without limitation, amending the Certificate of Incorporation or the by-laws of
the Issuer, or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other action, avoid or
seek to avoid the observance or performance of any of the terms of this
Warrant, but will at all times in good faith assist in the carrying out of all
such terms and in the taking of all such actions as may be necessary or
appropriate to protect the rights of the Holder hereof against dilution (to the
extent specifically provided herein) or impairment.  Without limiting the generality of the
foregoing, the Issuer will (i) not permit the par value, if any, of its Common
Stock to exceed the then effective Warrant Price, (ii) not amend or modify any
provision of the Certificate of Incorporation or by-laws of the Issuer in any
manner that would adversely affect the rights of the Holders of the Warrants in
their capacity as Holders of the Warrants, (iii) take all such action as may be
reasonably necessary in order that the Issuer may validly and legally issue
fully paid and nonassessable shares of Common Stock, free and clear of any
liens, claims, encumbrances and restrictions (other than as provided herein)
upon the exercise of this Warrant, and (iv) use its reasonable best efforts to
obtain all such authorizations, exemptions or consents from any public
regulatory body having jurisdiction thereof as may be reasonably necessary to
enable the Issuer to perform its obligations under this Warrant.

 

(d)           Loss,
Theft, Destruction of Warrants.  Upon
receipt of an affidavit of loss and other evidence satisfactory to the Issuer
of the ownership of and the loss, theft, destruction or mutilation of any
Warrant and upon receipt of indemnity or security satisfactory to the Issuer
or, in the case of any such mutilation, upon surrender and cancellation of such
Warrant, the Issuer 

 

3

 

will make and
deliver, in lieu of such lost, stolen, destroyed or mutilated Warrant, a new
Warrant of like tenor and representing the right to purchase the same number of
shares of Common Stock.

 

4.             Adjustment of Warrant Price and
Warrant Share Number.  The number of
shares of Common Stock for which this Warrant is exercisable, and the price at
which such shares may be purchased upon exercise of this Warrant, shall be
subject to adjustment from time to time as set forth in this Section 4. The
Issuer shall give the Holder notice of any event described below which requires
an adjustment pursuant to this Section 4 in accordance with Section 5.

 

(a)           Recapitalization,
Reorganization, Reclassification, Consolidation, Merger or Sale.

 

(i)            In
case the Issuer after the Original Issue Date shall do any of the following
(each, a “Triggering Event”): (a) consolidate or merge with or into
another corporation where the holders of outstanding Voting Stock prior to such
merger or consolidation do not own over 50% of the outstanding Voting Stock of
the merged or consolidated entity immediately after such merger or
consolidation, or (b) sell all or substantially all of its properties or assets
to any other Person, or (c) change the Common Stock to the same or different
number of shares of any class or classes of stock, whether by reclassification,
exchange, substitution or otherwise (other than by way of a stock split or
combination of shares or stock dividends provided for in Section 4(b)), or (d)
effect a capital reorganization (other than by way of a stock split or
combination of shares or stock dividends provided for in Section 4(b)), then,
and in the case of each such Triggering Event, proper provision shall be made
so that, upon the basis and the terms and in the manner provided in this
Warrant, the Holder of this Warrant shall be entitled upon the exercise hereof
at any time after the consummation of such Triggering Event, to the extent this
Warrant is not exercised prior to such Triggering Event, to receive at the
Warrant Price in effect at the time immediately prior to the consummation of
such Triggering Event in lieu of the Common Stock issuable upon such exercise
of this Warrant prior to such Triggering Event, the securities, cash and
property to which such Holder would have been entitled upon the consummation of
such Triggering Event if such Holder had exercised the rights represented by
this Warrant immediately prior thereto, subject to adjustments (subsequent to
such corporate action) as nearly equivalent as possible to the adjustments
provided for elsewhere in this Section 4. 
The Issuer will not effect any consolidation, merger or sale or
conveyance unless prior to the consummation thereof, the successor or acquiring
entity (if other than the Issuer) and, if an entity different from the
successor or acquiring entity, the entity whose capital stock or assets the
holders of the Common Stock of the Issuer are entitled to receive as a result
of such consolidation, merger or sale or conveyance assumes by written
instrument the obligations under this Section 4 and the obligations to deliver
to the holder of this Warrant such shares of stock, securities or assets as, in
accordance with the foregoing provisions, the holder may be entitled to
acquire.

 

(ii)           Notwithstanding
anything contained in this Warrant to the contrary, a Triggering Event shall
not be deemed to have occurred if, prior to the consummation thereof, each
Person (other than the Issuer) which may be required to deliver any securities,
cash or property upon the exercise of this Warrant as provided herein shall
assume, by written instrument delivered to, and reasonably satisfactory to, the
Holder of this Warrant, (A) the obligations of the Issuer under this Warrant
(and if the Issuer shall

 

4

 

survive the consummation
of such Triggering Event, such assumption shall be in addition to, and shall
not release the Issuer from, any continuing obligations of the Issuer under
this Warrant) and (B) the obligation to deliver to such Holder such shares of
securities, cash or property as, in accordance with the foregoing provisions of
this subsection (a), such Holder shall be entitled to receive, and such Person
shall have similarly delivered to such Holder a written acknowledgement
executed by the President or Chief Financial Officer of the Issuer, stating
that this Warrant shall thereafter continue in full force and effect and the
terms hereof (including, without limitation, all of the provisions of this
subsection (a)) shall be applicable to the securities, cash or property which
such Person may be required to deliver upon any exercise of this Warrant or the
exercise of any rights pursuant hereto.

 

(b)           Stock Dividends, Subdivisions and
Combinations.  If at any time the
Issuer shall:

 

(i)            make or issue or set a record date
for the holders of its Common Stock for the purpose of entitling them to
receive a dividend payable in, or other distribution of, shares of Common
Stock,

 

(ii)           effect a stock split of its
outstanding shares of Common Stock into a larger number of shares of Common
Stock, or

 

(iii)          combine its outstanding shares of
Common Stock into a smaller number of shares of Common Stock,

 

then (1) the number of
shares of Common Stock for which this Warrant is exercisable immediately after
the occurrence of any such event shall be adjusted to equal the number of
shares of Common Stock which a record holder of the same number of shares of
Common Stock for which this Warrant is exercisable immediately prior to the
occurrence of such event would own or be entitled to receive after the
happening of such event, and (2) the Warrant Price then in effect shall be
adjusted to equal (A) the Warrant Price then in effect multiplied by the number
of shares of Common Stock for which this Warrant is exercisable immediately
prior to the adjustment divided by (B) the number of shares of Common Stock for
which this Warrant is exercisable immediately after such adjustment.

 

Notwithstanding the
foregoing, if such record date shall have been fixed and such dividend is not
fully paid or if such distribution is not fully made on the date fixed
therefor, the Warrant Price shall be adjusted pursuant to this paragraph as of
the time of actual payment of such dividends or distributions.

 

(c)           Other Provisions applicable to
Adjustments under this Section.  The
following provisions shall be ap­plicable to the making of adjustments of the
number of shares of Common Stock for which this Warrant is exercisable and the
Warrant Price then in effect provided for in this Section 4:

 

(i)            When Adjustments to Be Made.  The adjustments required by this Section 4
shall be made whenever and as often as any specified event requiring an
adjustment shall occur.  For the purpose
of any adjustment, any specified event shall be deemed to have occurred at the
close of business on the date of its occurrence.

 

5

 

(ii)           Fractional Interests.  In computing ad­justments under this Section
4, fractional interests in Common Stock shall be taken into account to the near­est
one one-hundredth (1/100th) of a share.

 

(iii)          When Adjustment Not Required.  If the Issuer shall take a record of the
holders of its Common Stock for the purpose of entitling them to receive a
dividend and shall, thereafter and before the dividend to stockholders thereof,
legally abandon its plan to pay or deliver such dividend, then thereafter no
adjustment shall be required by reason of the taking of such record and any
such adjustment previously made in respect thereof shall be rescinded and
annulled.

 

(d)           Form of Warrant after Adjustments.  The form of this Warrant need not be changed
because of any adjustments in the Warrant Price or the number and kind of
Securities purchasable upon the exercise of this Warrant.

 

5.             Notice of Adjustments.  Whenever the Warrant Price or Warrant Share
Number shall be adjusted pursuant to Section 4 hereof (for purposes of this
Section 5, each an “adjustment”), the Issuer shall cause its Chief Financial
Officer to prepare and execute a certificate setting forth, in reasonable detail,
the event requiring the adjustment, the amount of the adjustment, the method by
which such adjustment was calculated, and the Warrant Price and Warrant Share
Number after giving effect to such adjustment, and shall cause copies of such
certificate to be delivered to the Holder of this Warrant promptly after each
adjustment.

 

6.             Fractional Shares.  No fractional shares of Warrant Stock will be
issued in connection with and exercise hereof, but in lieu of such fractional
shares, the Issuer shall make a cash payment therefor equal in amount to the
product of the applicable fraction multiplied by the Per Share Market Value
then in effect.

 

7.             Ownership Cap and Certain
Exercise Restrictions. 
Notwithstanding anything to the contrary set forth in this Warrant, at
no time may a Holder of this Warrant exercise this Warrant if the number of
shares of Common Stock to be issued pursuant to such exercise would exceed,
when aggregated with all other shares of Common Stock owned by such Holder at
such time, the number of shares of Common Stock which would result in such
Holder owning more than 4.999% of all of the Common Stock outstanding at such
time; provided, however, that upon a holder of this Warrant providing the
Issuer with sixty-one (61) days notice (pursuant to Section 12 hereof) (the “Waiver
Notice”) that such Holder would like to waive this Section 7 with regard to any
or all shares of Common Stock issuable upon exercise of this Warrant, this
Section 7 will be of no force or effect with regard to all or a portion of the
Warrant referenced in the Waiver Notice; provided, further, that this provision
shall be of no further force or effect during the sixty-one (61) days
immediately preceding the expiration of the term of this Warrant.

 

8.             Definitions.  For the purposes of this Warrant, the
following terms have the following meanings:

 

“Capital Stock”
means and includes (i) any and all shares, interests, participations or other
equivalents of or interests in (however designated) corporate stock, including,
without limitation, shares of preferred or preference stock, (ii) all
partnership interests

 

6

 

(whether general
or limited) in any Person which is a partnership, (iii) all membership
interests or limited liability company interests in any limited liability
company, and (iv) all equity or ownership interests in any Person of any other
type.

 

“Certificate of
Incorporation” means the Certificate of Incorporation of the Issuer as in
effect on the Original Issue Date, and as hereafter from time to time amended,
modified, supplemented or restated in accordance with the terms hereof and
thereof and pursuant to applicable law.

 

“Common Stock”
means the Common Stock, par value $.01 per share, of the Issuer and any other
Capital Stock into which such stock may hereafter be changed.

 

“Holders”
mean the Persons who shall from time to time own any Warrant.  The term “Holder” means one of the Holders.

 

“Independent
Appraiser” means a nationally recognized or major regional investment banking
firm or firm of independent certified public accountants of recognized standing
(which may be the firm that regularly examines the financial statements of the
Issuer) that is regularly engaged in the business of appraising the Capital
Stock or assets of corporations or other entities as going concerns, and which
is not affiliated with either the Issuer or the Holder of any Warrant.

 

“Issuer”
means SatCon Technology Corporation, a Delaware corporation, and its
successors.

 

“Nasdaq”
means the Nasdaq National Market or the Nasdaq SmallCap Market.

 

“Original Issue
Date” means December 22, 2004.

 

“OTC Bulletin
Board” means the over-the-counter electronic bulletin board.

 

“Person” means an
individual, corporation, limited liability company, partnership, joint stock
company, trust, unincorporated organization, joint venture, governmental
authority or other entity of whatever nature.

 

“Per Share
Market Value” means on any particular date (a) the average of the closing
bid and asked price per share of the Common Stock on such date on Nasdaq or
another registered national stock exchange on which the Common Stock is then
listed, or if there is no such price on such date, then the average of the
closing bid and asked price on such exchange or quotation system on the date
nearest preceding such date, or (b) if the Common Stock is not listed then on
Nasdaq or any registered national stock exchange, the closing bid price for a
share of Common Stock in the over-the-counter market, as reported
by the OTC Bulletin Board or in the National Quotation Bureau Incorporated or
similar organization or agency succeeding to its functions of reporting prices)
at the close of business on such date, or (c) if the Common Stock is not then
reported by the OTC Bulletin Board or the National Quotation Bureau
Incorporated (or similar organization or agency succeeding to its functions of
reporting prices), then the average of the “Pink Sheet” quotes for the relevant
conversion period, as determined in

 

7

 

good faith by the
holder, or (d) if the Common Stock is not then publicly traded the fair market
value of a share of Common Stock as determined by an Independent Appraiser
selected in good faith by the Majority Holders; provided, however,
that the Issuer, after receipt of the determination by such Independent
Appraiser, shall have the right to select an additional Independent Appraiser,
in which case, the fair market value shall be equal to the average of the
determinations by each such Independent Appraiser; and provided, further
that all determinations of the Per Share Market Value shall be appropriately
adjusted for any stock dividends, stock splits or other similar transactions
during such period.  The determination of
fair market value by an Independent Appraiser shall be based upon the fair
market value of the Issuer determined on a going concern basis as between a
willing buyer and a willing seller and taking into account all relevant factors
determinative of value, and shall be final and binding on all parties.  In determining the fair market value of any
shares of Common Stock, no consideration shall be given to any restrictions on
transfer of the Common Stock imposed by agreement or by federal or state
securities laws, or to the existence or absence of, or any limitations on,
voting rights.

 

“Purchase
Agreement” means the Common Stock Purchase Agreement dated as of December
21, 2004, among the Issuer and the investors a party thereto.

 

“Securities”
means any debt or equity securities of the Issuer, whether now or hereafter
authorized, any instrument convertible into or exchangeable for Securities or a
Security, and any option, warrant or other right to purchase or acquire any
Security.  “Security” means one of the
Securities.

 

“Securities Act”
means the Securities Act of 1933, as amended, or any similar federal statute
then in effect.

 

“Subsidiary”
means any corporation at least 50% of whose outstanding Voting Stock shall at
the time be owned directly or indirectly by the Issuer or by one or more of its
Subsidiaries, or by the Issuer and one or more of its Subsidiaries.

 

“Super Majority
Holders” means at any time the Holders of Warrants exercisable for at least
75% of the shares of Warrant Stock issuable under the Warrants at the time
outstanding.

 

“Term” has
the meaning specified in Section 1 hereof.

 

“Trading Day”
means (a) a day on which the Common Stock is traded on Nasdaq, or (b) if the
Common Stock is not listed on Nasdaq, a day on which the Common Stock is traded
on any other registered national stock exchange, or (c) if the Common Stock is
not traded on any other registered national stock exchange, a day on which the
Common Stock is traded on the OTC Bulletin Board, or (d) if the Common Stock is
not traded on the OTC Bulletin Board, a day on which the Common Stock is quoted
in the over-the-counter market as reported by the National
Quotation Bureau Incorporated (or any similar organization or agency succeeding
its functions of reporting prices); provided, however, that in
the event that the Common Stock is not listed or quoted as set forth in (a),
(b) or (c) hereof, then Trading Day shall mean any day except Saturday, Sunday
and any day which shall be a legal holiday or a day on which banking
institutions

 

8

 

 in the State of New York are authorized or
required by law or other government action to close.

 

“Voting Stock”
means, as applied to the Capital Stock of any corporation, Capital Stock of any
class or classes (however designated) having ordinary voting power for the
election of a majority of the members of the board of directors (or other
governing body) of such corporation, other than Capital Stock having such power
only by reason of the happening of a contingency.

 

“Warrants”
means the Warrants issued and sold pursuant to the Purchase Agreement,
including, without limitation, this Warrant, and any other warrants of like
tenor issued in substitution or exchange for any thereof pursuant to the
provisions of Section 2(c), 2(d) or 2(e) hereof or of any of such other
Warrants.

 

“Warrant Price”
initially means U.S. $2.00, as such Warrant Price may be adjusted from time to
time as shall result from the adjustments specified in this Warrant, including
Section 4 hereto.

 

“Warrant Share
Number” means at any time the aggregate number of shares of Warrant Stock
which may at such time be purchased upon exercise of this Warrant, after giving
effect to all prior adjustments and increases to such number made or required
to be made under the terms hereof.

 

“Warrant Stock”
means Common Stock issuable upon exercise of any Warrant or Warrants or
otherwise issuable pursuant to any Warrant or Warrants.

 

9.             Other Notices.  In case at any time:

 

(A)                              the
Issuer shall make any distributions to the holders of Common Stock; or

 

(B)                                the
Issuer shall authorize the granting to all holders of its Common Stock of
rights to subscribe for or purchase any shares of Capital Stock of any class or
other rights; or

 

(C)                                there
shall be any reclassification of the Capital Stock of the Issuer; or

 

(D)                               there
shall be any capital reorganization by the Issuer; or

 

(E)                                 there
shall be any (i) consolidation or merger involving the Issuer or (ii) sale,
transfer or other disposition of all or substantially all of the Issuer’s
property, assets or business (except a merger or other reorganization in which
the Issuer shall be the surviving corporation and its shares of Capital Stock
shall continue to be outstanding and unchanged and except a consolidation,
merger, sale, transfer or other disposition involving a wholly-owned
Subsidiary); or

 

9

 

(F)                                 there
shall be a voluntary or involuntary dissolution, liquidation or winding-up of
the Issuer or any partial liquidation of the Issuer or distribution to holders
of Common Stock;

 

then, in each of
such cases, the Issuer shall give written notice to the Holder of the date on
which (i) the books of the Issuer shall close or a record shall be taken for
such dividend, distribution or subscription rights or (ii) such reorganization,
reclassification, consolidation, merger, disposition, dissolution, liquidation
or winding-up, as the case may be, shall take place.  Such notice also shall specify the date as of
which the holders of Common Stock of record shall participate in such dividend,
distribution or subscription rights, or shall be entitled to exchange their
certificates for Common Stock for securities or other property deliverable upon
such reorganization, reclassification, consolidation, merger, disposition,
dissolution, liquidation or winding-up, as the case may be.  Such notice shall be given at least twenty
(20) days prior to the record date or effective date for the event specified in
such notice.

 

10.           Amendment and Waiver.  Any term, covenant, agreement or condition in
this Warrant may be amended, or compliance therewith may be waived (either
generally or in a particular instance and either retroactively or
prospectively), by a written instrument or written instruments executed by the
Issuer and the Super Majority Holders; provided, however, that no
such amendment or waiver shall reduce the Warrant Share Number, increase the
Warrant Price, shorten the period during which this Warrant may be exercised or
modify any provision of this Section 10 without the consent of the Holder of
this Warrant.

 

11.           Governing Law.  This Warrant shall be governed by and
construed in accordance with the laws of the State of Delaware, without giving
effect to principles of conflicts of law.  Each of the
Issuer and the Holder (i) hereby irrevocably submits to the exclusive
jurisdiction of the United States District Court sitting in the District of
Delaware and the courts of the State of Delaware for the purposes of any suit,
action or proceeding arising out of or relating to this Warrant or any of the
other Transaction Documents (as defined in the Purchase Agreement) or the
transactions contemplated hereby or thereby and (ii) hereby waives, and agrees
not to assert in any such suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of such court, that the suit, action or proceeding
is brought in an inconvenient forum or that the venue of the suit, action or
proceeding is improper.  Each of the
Issuer and the Holder consents to process being served in any such suit, action
or proceeding by mailing a copy thereof to such party at the address in effect
for notices to it under the Purchase Agreement and agrees that such service
shall constitute good and sufficient service of process and notice thereof.  Nothing in this Section 11 shall affect or
limit any right to serve process in any other manner permitted by law.

 

12.           Notices.  Any and all notices or other communications
or deliveries required or permitted to be provided hereunder shall be in
writing and shall be deemed given and effective on the earlier of (i) the date
of transmission, if such notice or communication is delivered via facsimile at
the facsimile telephone number specified for notice prior to 5:00 p.m., eastern
time, on a Trading Day, (ii) the Trading Day after the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile
telephone number specified for notice later than 5:00 p.m., eastern time, on
any date and earlier than 11:59 p.m., eastern time, on such

 

10

 

date, (iii) the
Trading Day following the date of mailing, if sent by overnight delivery by
nationally recognized overnight courier service or (iv) actual receipt by the
party to whom such notice is required to be given.  The addresses for such communications shall
be with respect to the Holder of this Warrant or of Warrant Stock issued
pursuant hereto, addressed to such Holder at its last known address or facsimile
number appearing on the books of the Issuer maintained for such purposes, or
with respect to the Issuer, addressed to:

 

SatCon Technology
Corporation

27 Drydock Avenue

Boston, MA 02210

Attention: David
B. Eisenhaure

Tel. No.:
617-897-2404

Fax No.:  617-897-2401

 

Copies of notices
to the Issuer shall be sent to Greenberg Traurig LLP, One International Place,
Boston, MA 02110, Attention: Jonathan Bell, Esq., Tel. No.: (617) 310-6038, Fax
No.: (617) 279-8438.  Any party hereto
may from time to time change its address for notices by giving at least ten
(10) days written notice of such changed address to the other party hereto.

 

13.           Warrant Agent.  The Issuer may, by written notice to each
Holder of this Warrant, appoint an agent having an office in New York, New York
for the purpose of issuing shares of Warrant Stock on the exercise of this
Warrant pursuant to subsection (b) of Section 2 hereof, exchanging this Warrant
pursuant to subsection (d) of Section 2 hereof or replacing this Warrant
pursuant to subsection (d) of Section 3 hereof, or any of the foregoing, and
thereafter any such issuance, exchange or replacement, as the case may be,
shall be made at such office by such agent.

 

14.           Remedies.  The Issuer stipulates that the remedies at
law of the Holder of this Warrant in the event of any default or threatened
default by the Issuer in the performance of or compliance with any of the terms
of this Warrant are not and will not be adequate and that, to the fullest
extent permitted by law, such terms may be specifically enforced by a decree for
the specific performance of any agreement contained herein or by an injunction
against a violation of any of the terms hereof or otherwise.

 

15.           Successors and Assigns.  This Warrant and the rights evidenced hereby
shall inure to the benefit of and be binding upon the successors and assigns of
the Issuer, the Holder hereof and (to the extent provided herein) the Holders
of Warrant Stock issued pursuant hereto, and shall be enforceable by any such
Holder or Holder of Warrant Stock.

 

16.           Modification and Severability.  If, in any action before any court or agency
legally empowered to enforce any provision contained herein, any provision
hereof is found to be unenforceable, then such provision shall be deemed
modified to the extent necessary to make it enforceable by such court or
agency.  If any such provision is not
enforceable as set forth in the preceding sentence, the unenforceability of
such provision shall not affect the other provisions of this Warrant, but this
Warrant shall be construed as if such unenforceable provision had never been
contained herein.

 

11

 

17.           Headings.  The headings of the Sections of this Warrant
are for convenience of reference only and shall not, for any purpose, be deemed
a part of this Warrant.

 

[Remainder
of Page Has Been Intentionally Left Blank]

 

12

 

IN WITNESS WHEREOF, the Issuer has executed this
Warrant as of the day and year first above written.

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
  SATCON TECHNOLOGY CORPORATION

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  

 

13

 

EXERCISE FORM

SATCON
TECHNOLOGY CORPORATION

 

The undersigned                            ,
pursuant to the provisions of the within Warrant, hereby elects to exercise
this Warrant for       shares of Common
Stock of SatCon Technology Corporation. 
This Warrant is being exercised by “cashless exercise”.  Accordingly, the number of shares of Common
Stock to be issued upon such exercise shall be determined in accordance with
Section 2(c) of the Warrant.

 

	
  Dated:

  	
   

  	
   

  	
  Signature

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address

  	
   

  
	
   

  	
   

  	
   

  

 

Number of shares of
Common Stock beneficially owned or deemed beneficially owned by the Holder on
the date of Exercise:                                                   

 

ASSIGNMENT

 

FOR VALUE
RECEIVED,                                                  hereby
sells, assigns and transfers unto                                                  the
within Warrant and all rights evidenced thereby and does irrevocably constitute
and appoint                                                  ,
attorney, to transfer the said Warrant on the books of the within named
corporation.

 

	
  Dated:

  	
   

  	
   

  	
  Signature

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address

  	
   

  
	
   

  	
   

  	
   

  

 

PARTIAL ASSIGNMENT

 

FOR VALUE
RECEIVED,                                                  hereby
sells, assigns and transfers
unto                                                  the
right to
purchase                                                  shares
of Warrant Stock evidenced by the within Warrant together with all rights
therein, and does irrevocably constitute and
appoint                                                  ,
attorney, to transfer that part of the said Warrant on the books of the within
named corporation.

 

	
  Dated:

  	
   

  	
   

  	
  Signature

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address

  	
   

  
	
   

  	
   

  	
   

  

 

FOR USE BY THE
ISSUER ONLY:

 

This Warrant No.
W-          canceled (or
transferred or exchanged)
this          day of          ,          ,
shares of Common Stock issued therefor in the name
of          , Warrant No. W-          issued
for          shares of Common
Stock in the name of                .

 

14

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00076-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00076-of-00352.parquet"}]]