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  Exhibit 10.10    
    

 
  CAPSTONE TURBINE CORPORATION 2000 EQUITY INCENTIVE PLAN
  STOCK BONUS AGREEMENT

        THIS AGREEMENT is made and entered into on this        day of                ,
20    , by and
between Capstone Turbine Corporation (the "Company") and [Participant] (the "Participant"), in connection with the grant of a
Stock Bonus made on                    , 20    (the "Grant Date") under the Capstone Turbine Corporation 2000 Equity Incentive
Plan, as amended and restated September 10, 2004 (the
"Plan"). In consideration of the foregoing, the parties have entered into this Agreement to govern the terms of this Stock Bonus: 

        1.    Stock Bonus Grant.    Subject to the terms and conditions set forth in the Plan and herein, the Company grants
to the Participant a Stock Bonus award covering [number of shares] shares, subject to adjustment as provided in
Section 15 of the Plan. Upon the performance of the conditions of Paragraph 3, the shares covered by this Stock Bonus will be transferred to the Participant. The rights in the Stock
Bonus award will be forfeited if the Participant ceases to be an Employee to the extent that the shares have not been transferred to the Participant in accordance with the schedule in
Paragraph 3. 

        2.    Transfer of Stock Bonus.    Except for transfers pursuant to a will or the laws of descent and distribution,
this Stock Bonus is not transferable and the Participant may not make any disposition of the shares of Common Stock described herein, or any interest herein, prior to the dates that such shares are
transferred to the Participant as described in Paragraph 3; provided, however, that the Stock Bonus may be transferred to the extent consented to by the Committee. As used herein, "disposition"
means any
sale, transfer, encumbrance, gift, donation, assignment, pledge, hypothecation, or other disposition, whether similar or dissimilar to those previously enumerated, whether voluntary or involuntary,
and whether during the Participant's lifetime or upon or after the Participant's death, including, but not limited to, any disposition by operation of law, by court order, by judicial process, or by
foreclosure, levy, or attachment, except a transfer by will or by the laws of descent or distribution. Any attempted disposition in violation of this Paragraph is void. 

        3.    Vesting of Stock Bonus.    

        (a)   The
Common Stock covered by this Stock Bonus shall be transferred to the Participant as fully vested shares in accordance with the following schedule, except as provided
in Paragraph 4, provided that the Participant continues to be an Employee during such periods: 

 

 

			
	On and After

 
	 	Stock Bonus

Shares Transferred 
	First Anniversary of Grant Date	 	25%
	Second Anniversary of Grant Date	 	Additional 25%
	Third Anniversary of Grant Date	 	Additional 25%
	Fourth Anniversary of Grant Date	 	Additional 25%

 

 

        (b)   In
the event of a transaction described in Section 15 of the Plan, the terms governing Restricted Stock under the Plan shall apply to this Stock Bonus. 

        4.    Termination of Services.    

        (a)   On
the date that a Participant ceases to be an Employee, for any reason other than death or disability, the Participant will forfeit the right to receive all shares that
have not yet been transferred and become vested in accordance with the schedule set forth in Paragraph 3. 

        (b)   On
the date that a Participant ceases to be an Employee because of death or disability, all shares of Common Stock covered by this Stock Bonus award will be transferred 

 

to
the Participant (or legal representative) and shall be fully vested without regard to the schedule set forth in Paragraph 3. 

        (c)   For
purposes of this Stock Bonus, a "disability" shall be defined in accordance with section 22(e)(3) of the Code. 

        5.    Status of Participant.    Prior to the date that shares are transferred to the Participant pursuant to this
Agreement or the Plan, the Participant will not be a stockholder of the Company with respect to Common Stock covered by the Stock Bonus and shall not be entitled to receive dividends and exercise
voting rights with respect thereto. The Company is not required to deliver shares of Common Stock to the Participant until the conditions for transfer have occurred, all applicable requirements of law
have been complied with and such shares shall have been duly listed on any securities exchange on which the Common Stock may then be listed. 

        6.    Tax Withholding.    At the time that any portion of the Stock Bonus becomes vested and shares of Common Stock
covered by the Stock Bonus are transferred to the Participant, the Company shall withhold from the shares to be delivered a number of shares that have a Fair Market Value equivalent to the tax
withholdings that are required to be remitted by the Company to the appropriate governmental entities on behalf of the Participant with respect to such transaction and shall direct the brokerage firm
that has been selected by the Company to administer the Plan, to sell such shares and remit the proceeds to the Company. The parties intend this authorization to constitute a plan pursuant to the
provisions of Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, in order to authorize the disposition of Common Stock. The plan shall commence on the date hereof
and terminate on the completion of all transactions contemplated herein. In addition, the Participant shall have the right to suspend or terminate the plan at any time by delivering written notice in
the manner that is prescribed by the Company. In the event the plan is suspended or terminated, the Participant does hereby consent to withholding by the Company from cash compensation otherwise due
to Participant in an amount that is sufficient to satisfy the Company's tax withholding obligations. Participant further agrees to immediately tender additional funds that may be needed for tax
withholding purposes at the request of the Company. 

        7.    No Effect on Capital Structure.    This Stock Bonus shall not affect the right of the Company or any Subsidiary
to reclassify, recapitalize or otherwise change its capital or debt structure or to merge, consolidate, convey any or all of its assets, dissolve, liquidate, windup, or otherwise reorganize. 

        8.    Committee Authority.    Any question concerning the interpretation of this Agreement, any adjustments required
to be made under the Plan and any controversy that may arise under the Plan or this Agreement shall be determined by the Committee in its sole discretion. Such decision by the Committee shall be final
and binding. 

        9.    Plan Controls.    The terms of this Agreement are governed by the terms of the Plan, as it exists on the date of
this Agreement and as the Plan is amended from time to time. A copy of the Plan, and all amendments thereto, has been delivered or made available to the Participant and shall be deemed a part of this
Agreement as if fully set forth herein. In the event of any conflict between the provisions of the Agreement and the provisions of the Plan, the terms of the Plan shall control, except as expressly
stated otherwise. For purposes of this Agreement, the defined terms in the Plan shall have the same
meaning in this Agreement, except where the context otherwise requires. The term "Section" generally refer to provisions within the Plan. The term "Paragraph" shall refer to a provision of this
Agreement. 

        10.    Notice.    Whenever any notice is required or permitted hereunder, such notice must be in writing and
personally delivered or sent by mail. Any notice required or permitted to be delivered 

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hereunder
shall be deemed to be delivered on the date which it is personally delivered, or, whether actually received or not, on the third business day after it is deposited in the United States mail,
certified or registered, postage prepaid, addressed to the person who is to receive it at the address that such person has theretofore specified by written notice delivered in accordance herewith. The
Company or Participant may change, by written notice to the other, the address previously specified for receiving notices. Notices delivered to the Company shall be addressed as follows: 

 

 

					
	 	 	Capstone Turbine Corporation

Attn: Jayme Brooks

21211 Nordhoff Street

Chatsworth, CA 91311
	 	 	Phone:	 	(818) 734-5300
	 	 	Fax:	 	(818) 734-1033

 

 
Notices
to the Participant shall be hand-delivered to the Participant on the premises of the Company or its Subsidiaries, or mailed to the last address shown on the records of the Company. 

        11.    Information Confidential.    As partial consideration for the granting of this Stock Bonus, the Participant
agrees that he or she will keep confidential all information and knowledge that the Participant has relating to the manner and amount of his or her participation in the Plan; provided, however, that
such information may be disclosed as required by law and may be given in confidence to the Participant's spouse, tax and financial advisors, or to a financial institution to the extent that such
information is necessary to secure a loan. 

        12.    Amendment.    The Company, acting through the Committee or through the Board, may amend this Agreement at any
time for any purpose determined by the Company in its sole discretion that is consistent with the Plan, including but not limited to an amendment to accelerate the vesting schedule set forth in
Paragraph 3 due to normal retirement or other special circumstances, or to permit transfers of the Stock Bonus to certain individuals specified by the Participant. All amendments must be in
writing. The Company may not amend this Agreement, however, without the Participant's express agreement to any amendment that could adversely effect the material rights of the Participant. 

        13.    Governing Law.    Except as is otherwise provided in the Plan, where applicable, the provisions of this
Agreement shall be governed by the internal laws of the State of California, without regard to the principles of conflicts of laws thereof. 

        IN WITNESS WHEREOF, effective as of                        , 20    , an
authorized officer of the Company has executed this Agreement;
the Participant's acceptance of the terms of this Agreement shall be evidenced electronically through the procedures established by the Company. 

CAPSTONE TURBINE CORPORATION

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QuickLinks

Exhibit 10.10

CAPSTONE TURBINE CORPORATION 2000 EQUITY INCENTIVE PLAN STOCK BONUS AGREEMENTExhibit 10.21

 

THIRD AMENDMENT TO CREDIT AND SECURITY AGREEMENTS
 AND WAIVER OF DEFAULT

 

THIS THIRD AMENDMENT TO CREDIT AND SECURITY AGREEMENTS AND WAIVER OF DEFAULT (the “Amendment”), dated June 11, 2010, is entered into by and between CAPSTONE TURBINE CORPORATION, a Delaware corporation (“Company”), and WELLS FARGO BANK, NATIONAL ASSOCIATION (“Wells Fargo”), acting through its Wells Fargo Business Credit operating division.

 

RECITALS

 

A.                                   Company and Wells Fargo are parties to (i) a Credit and Security Agreement dated February 9, 2009 (as amended by that certain First Amendment to Credit and Security Agreements, dated June 9, 2009 (“First Amendment”), and that certain Second Amendment to Credit and Security Agreements and Waiver of Defaults, dated November 5, 2009 (“Second Amendment”), and as further amended from time to time, the “Domestic Credit Agreement”), and (ii) a Credit and Security Agreement (Ex-Im Subfacility), dated February 9, 2009 (as amended by the First Amendment and the Second Amendment and further amended from time to time, the “Ex-Im Credit Agreement”; and together with the Domestic Credit Agreement, the “Credit Agreements”).  Capitalized terms used in these recitals have the meanings given to them in the Credit Agreements unless otherwise specified.

 

B.                                     Company has requested that (i) certain amendments be made to the Credit Agreements, and (ii) an Event of Default be waived, both of which Wells Fargo is willing to agree to pursuant to the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the premises and of the mutual covenants and agreements herein contained, it is agreed as follows:

 

1.                                       Section 5.2(a) of the Credit Agreements.  Section 5.2(a) of the Credit Agreements is hereby deleted in its entirety and replaced with the following:

 

“(a)                            Minimum Book Net Worth.  Company shall maintain a Book Net Worth, determined as of the following test dates, in an amount not less than the amount set forth for each such test date (numbers appearing between “< >” are negative):

 

	    Test   Date
    	     
    	    Minimum Book Net Worth
    	     
    
	    June 30, 2010
    	     
    	    $
    	    64,346,000
    	     
    
	    September 30, 2010
    	     
    	    $
    	    57,671,000
    	     
    
	    December 31, 2010
    	     
    	    $
    	    52,983,000
    	     
    
	    March 31, 2011
    	     
    	    $
    	    50,090,000
    	     
    

 

1

 

2.                                       Section 5.2(b) of the Credit Agreements.  Section 5.2(b) of the Credit Agreements is hereby deleted in its entirety and replaced with the following:

 

“(a)                            Minimum Net Income.  Company shall achieve Net Income, measured on each of the following test dates described below, for the quarter period ending on each such test date, Net Income of not less than the amount set forth opposite each such test date (numbers appearing between “< >” are negative):

 

	    Test   Date
    	     
    	    Minimum Net Income
    	     
    
	    June 30, 2010
    	     
    	    $
    	    <11,283,000>
    	     
    
	    September 30, 2010
    	     
    	    $
    	    <9,859,000>
    	     
    
	    December 31, 2010
    	     
    	    $
    	    <7,549,000>
    	     
    
	    March 31, 2011
    	     
    	    $
    	    <5,161,000>
    	     
    

 

3.                                       Section 5.28 of the Credit Agreement.  The following new Section 5.28 is hereby added to the Credit Agreements immediately after Section 5.27 of the Credit Agreements:

 

“5.28                  Cash Collateral.  Company shall establish and maintain a pledge of cash collateral in an amount of least $5,000,000 at all times (the “Cash Collateral”), subject to the following terms and conditions:  (i) the Cash Collateral shall be held in a deposit account or securities account maintained at Wells Fargo Bank, National Association or an affiliate of Wells Fargo (the “Cash Collateral Account”); (ii) to secure the Indebtedness, Company hereby grants to Wells Fargo a security interest in all of Company’s right, title, and interest in and to the Cash Collateral, the Cash Collateral Account, all interest that accrues (if any) on the Cash Collateral, and all products and proceeds thereof, in each case whether now existing or hereafter arising; (iii) Company shall have no access to the Cash Collateral or the Cash Collateral Account (i.e., the Cash Collateral Account shall be deemed “blocked”), until this Agreement has been terminated and all Indebtedness has been paid in full; (iv) any interest (if any) that may accrue on the Cash Collateral shall be held in the Cash Collateral Account, and shall itself be deemed to be Cash Collateral; (v) during any Default Period, Wells Fargo may, in Wells Fargo’s sole discretion, apply all or any portion of the Cash Collateral to the Indebtedness; (vi) the Cash Collateral, Cash Collateral Account, all interest that accrues (if any) on the Cash Collateral, and all products and proceeds thereof shall be deemed to be “Collateral” under this Agreement and the other Loan Documents; (vii) Company shall not have any right to access the foregoing collateral so long as this Agreement is in effect or any Indebtedness remains outstanding, Company shall not transfer (or attempt to transfer) any such collateral to any Person, and Company shall keep such collateral free and clear of all Liens (except in favor Wells Fargo); and (viii) Company shall execute and/or deliver any instruments, documents, assignments, security agreements, control agreements, financing statements, and any other agreement that Wells Fargo may request to evidence, maintain, perfect, and/or ensure the first priority of Wells Fargo’s security interest in the foregoing collateral; provided that failure to execute or deliver any such items shall not affect the foregoing grant of the security interest in the foregoing collateral, and Wells Fargo shall be deemed to have a duly perfected and first priority security interest in all such collateral at all times.”

 

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4.                                       Exhibit E to the Domestic Credit Agreement.  Exhibit E to the Domestic Credit Agreement is hereby deleted and replaced with Exhibit E-1 attached to this Amendment.

 

5.                                       Exhibit E to the Ex-Im Credit Agreement.  Exhibit E to the Ex-Im Credit Agreement is hereby deleted and replaced with Exhibit E-2 attached to this Amendment.

 

6.                                       Waiver of Default.  Company is in default of the following provision of the Credit Agreements (the “Existing Default”):

 

	    Section/Covenant
    	     
    	    Test Date
    
	    Section 5.2(b)
   (Minimum Net Income)
    	     
    	    March 31, 2010
    

 

Upon the terms and subject to the conditions set forth in this Amendment (including, but not limited to, the effectiveness of this Amendment in accordance with Section 9 of this Amendment), Wells Fargo hereby waives the Existing Default.  This waiver shall be effective only in this specific instance and for the specific purpose for which it is given, and this waiver shall not entitle Company to any other or further waiver in any similar or other circumstances.

 

7.                                       No Other Changes.  Except as explicitly amended by this Amendment, all of the terms and conditions of the Credit Agreements shall remain in full force and effect and shall apply to any advance or letter of credit thereunder.

 

8.                                       Accommodation Fee.  Company shall pay Wells Fargo as of the date hereof a fully earned, non-refundable accommodation fee in the amount of $50,000 in consideration of Wells Fargo’s execution and delivery of this Amendment (the “Accommodation Fee”).

 

9.                                       Conditions Precedent.  This Amendment shall be effective when Wells Fargo shall have received an executed original of this Amendment, together with each of the following, each in substance and form acceptable to Wells Fargo in its sole discretion:

 

9.1                                 A Certificate of the Secretary of Company certifying as to (i) the resolutions of the board of directors of Company approving the execution and delivery of this Amendment, (ii) the fact that the certificate of incorporation and bylaws of Company, which were certified and delivered to Wells Fargo pursuant to the Certificate of Authority of Company’s secretary or assistant secretary dated February 9, 2009, continue in full force and effect and have not been amended or otherwise modified except as set forth in the Certificate to be delivered, and (iii) the fact that the officers and agents of Company who have been certified to Wells Fargo, pursuant to the Certificate of Authority of Company’s secretary or assistant secretary dated February 9, 2009, as being authorized to sign and to act on behalf of Company continue to be so authorized;

 

9.2                                 Consent and approval of this Amendment by the Export Import Bank of the United States, if required by Wells Fargo;

 

9.3                                 The Acknowledgement and Agreement of Guarantor set forth at the end of this Amendment, duly executed by Guarantor;

 

9.4                                 Payment of the Accommodation Fee described in Section 8 of this Amendment;

 

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9.5                                 A Securities Account Control Agreement; and

 

9.6                                 Such other matters as Wells Fargo may require.

 

10.                                 Representations and Warranties.  Company hereby represents and warrants to Wells Fargo as follows:

 

10.1                           Company has all requisite power and authority to execute this Amendment and any other agreements or instruments required hereunder and to perform all of its obligations hereunder, and this Amendment and all such other agreements and instruments have been duly executed and delivered by Company and constitute the legal, valid and binding obligation of Company, enforceable in accordance with their terms.

 

10.2                           The execution, delivery and performance by Company of this Amendment and any other agreements or instruments required hereunder have been duly authorized by all necessary corporate action and do not (i) require any authorization, consent or approval by any governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, (ii) violate any provision of any law, rule or regulation or of any order, writ, injunction or decree presently in effect, having applicability to Company, or the certificate of incorporation or bylaws of Company, or (iii) result in a breach of or constitute a default under any indenture or loan or credit agreement or any other agreement, lease or instrument to which Company is a party or by which it or its properties may be bound or affected.

 

10.3                           All of the representations and warranties contained in Section 4 of, and Exhibit D to, the Credit Agreements are true and correct on and as of the date hereof as though made on and as of such date, except to the extent that such representations and warranties relate solely to an earlier date (in which case they shall continue to be true and correct as of such earlier date), provided that the Existing Default has occurred.

 

11.                                 References.  All references in the Credit Agreements to “this Agreement” shall be deemed to refer to the relevant Credit Agreement as amended hereby; and any and all references in the Security Documents to the Credit Agreements shall be deemed to refer to the relevant Credit Agreement as amended hereby.

 

12.                                 No Waiver.  Except as expressly provided in Section 6 of this Amendment, the execution of this Amendment and the acceptance of all other agreements and instruments related hereto shall not be deemed to be a waiver of any Default or Event of Default under the Credit Agreements or a waiver of any breach, default or event of default under any Security Document or other document held by Wells Fargo, whether or not known to Wells Fargo and whether or not existing on the date of this Amendment.

 

13.                                 Release.  Company and the Guarantor signing the Acknowledgment and Agreement of Guarantor set forth below hereby absolutely and unconditionally release and forever discharge Wells Fargo, and any and all participants, parent corporations, subsidiary corporations, affiliated corporations, insurers, indemnitors, successors and assigns thereof, together with all of the present and former directors, officers, agents, attorneys, and employees of any of the foregoing, from any and all claims, demands or causes of action of any kind, nature or description, whether arising in law or equity or upon contract or tort or under any state or federal law or otherwise, 

 

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which Company or Guarantor has had, now has or has made claim to have against any such person for or by reason of any act, omission, matter, cause or thing whatsoever arising from the beginning of time to and including the date of this Amendment, whether such claims, demands and causes of action are matured or unmatured or known or unknown.  It is the intention of the Company and Guarantor in executing this release that the same shall be effective as a bar to each and every claim, demand and cause of action specified and in furtherance of this intention the Company and Guarantor each waives and relinquishes all rights and benefits under Section 1542 of the Civil Code of the State of California, which provides:

 

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MIGHT HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

 

The parties acknowledge that each may hereafter discover facts different from or in addition to those now known or believed to be true with respect to such claims, demands, or causes of action and agree that this instrument shall be and remain effective in all respects notwithstanding any such differences or additional facts.

 

14.                                 Costs and Expenses.  Company hereby reaffirms its agreement under the Credit Agreements to pay or reimburse Wells Fargo on demand for all costs and expenses incurred by Wells Fargo in connection with the Loan Documents, including without limitation all fees and disbursements of legal counsel.  Without limiting the generality of the foregoing, Company specifically agrees to pay all fees and disbursements of counsel to Wells Fargo for the services performed by such counsel in connection with the preparation of this Amendment and the documents and instruments incidental hereto.  Company hereby agrees that Wells Fargo may, at any time or from time to time in its sole discretion and without further authorization by Company, make a loan to Company under the Credit Agreements, or apply the proceeds of any loan, for the purpose of paying any such fees, disbursements, costs and expenses and the fee set forth in Section 8 of this Amendment.

 

15.                                 Miscellaneous.  This Amendment and the Acknowledgment and Agreement of Guarantor may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed an original and all of which counterparts, taken together, shall constitute one and the same instrument.  Transmission by facsimile or “pdf” file of an executed counterpart of this Amendment shall be deemed to constitute due and sufficient delivery of such counterpart.  Any party hereto may request an original counterpart of any party delivering such electronic counterpart.  This Amendment and the rights and obligations of the parties hereto shall be construed in accordance with, and governed by, the laws of the State of California.  In the event of any conflict between this Amendment and the Credit Agreements, the terms of this Amendment shall govern.  The Export-Import Bank of the United States shall be an express intended beneficiary of this Amendment.

 

[Signatures on next page]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date first above written.

 

	     
    	    WELLS   FARGO BANK,
    
	     
    	    NATIONAL   ASSOCIATION
    
	     
    	     
    
	     
    	     
    
	     
    	    By:   
    	    /s/   Edit Kondorosi
    
	     
    	    Print   Name: 
    	    Edit   Kondorosi
    
	     
    	    Title:
    	    Vice   President
    
	     
    	     
    
	     
    	     
    
	     
    	    CAPSTONE   TURBINE CORPORATION
    
	     
    	     
    
	     
    	    By:   
    	    /s/   Edward Reich
    
	     
    	    Print   Name: 
    	    Edward   Reich
    
	     
    	    Its:   
    	    Executive   Vice President and CFO
    

 

S-1

 

ACKNOWLEDGMENT AND AGREEMENT OF GUARANTOR

 

The undersigned, a guarantor of the indebtedness of Capstone Turbine Corporation (“Company”) to Wells Fargo Bank, National Association (as more fully defined in the Amendment, “Wells Fargo”), acting through its Wells Fargo Business Credit operating division, pursuant to the separate Guaranty dated February 9, 2009 (“Guaranty”), hereby (i) acknowledges receipt of the foregoing Amendment; (ii) consents to the terms (including without limitation the release set forth in Section 13 of the Amendment) and execution thereof; (iii) reaffirms all obligations to Wells Fargo pursuant to the terms of the Guaranty; and (iv) acknowledges that Wells Fargo may amend, restate, extend, renew or otherwise modify the Credit Agreements and any indebtedness or agreement of the Company, or enter into any agreement or extend additional or other credit accommodations, without notifying or obtaining the consent of the undersigned and without impairing the liability of the undersigned under the  Guaranty for all of the Company’s present and future indebtedness to Wells Fargo.

 

	     
    	    CAPSTONE   TURBINE INTERNATIONAL, INC.
    
	     
    	     
    
	     
    	    By:
    	    /s/   Edward Reich
    
	     
    	    Print   Name:
    	    Edward   Reich
    
	     
    	    Title:
    	    Executive   Vice President and CFO
    

 

 

Exhibit E-1

 

Exhibit E to Credit and Security Agreement

 

COMPLIANCE CERTIFICATE

 

	    To:
    	     
    	    Wells   Fargo Bank, National Association
    
	    Date:
    	     
    	    [                                    ,   200  ]
    
	    Subject:
    	     
    	    Financial   Statements
    

 

In accordance with our Credit and Security Agreement dated February 9, 2009 (as amended from time to time, the “Credit Agreement”), attached are the financial statements of Capstone Turbine Corporation (the “Company”) dated [                            , 200  ] (the “Reporting Date”) and the year-to-date period then ended (the “Current Financials”).  All terms used in this certificate have the meanings given in the Credit Agreement.

 

A.                                    Preparation and Accuracy of Financial Statements.  I certify that the Current Financials have been prepared in accordance with GAAP, subject to year-end audit adjustments, and fairly present Company’s financial condition as of the Reporting Date.

 

B.                                    Name of Company; Merger and Consolidation.  I certify that:

 

(Check one)

 

	    o
    	     
    	    Company   has not, since the date of the Credit Agreement, changed its name or   jurisdiction of organization, nor has it consolidated or merged with another   Person.
    
	     
    	     
    	     
    
	    o
    	     
    	    Company   has, since the date of the Credit Agreement, either changed its name or   jurisdiction of organization, or both, or has consolidated or merged with   another Person, which change, consolidation or merger: o was   consented to in advance by Wells Fargo in an Authenticated Record, and/or o is more   fully described in the statement of facts attached to this Certificate.
    

 

C.                                    Events of Default.  I certify that:

 

(Check one)

 

	    o
    	     
    	    I   have no knowledge of the occurrence of an Event of Default under the Credit   Agreement, except as previously reported to Wells Fargo in a Record.
    
	     
    	     
    	     
    
	    o
    	     
    	    I   have knowledge of an Event of Default under the Credit Agreement not   previously reported to Wells Fargo in a Record, as more fully described in   the statement of facts attached to this Certificate, and further, I   acknowledge that Wells Fargo may under the terms of the Credit Agreement   impose the Default Rate at any time during the resulting Default Period.
    

 

 

D.                                    Litigation Matters.  I certify that:

 

(Check one)

 

	    o
    	     
    	    I   have no knowledge of any material adverse change to the litigation exposure   of Company or any of its Affiliates or of any Guarantor.
    
	     
    	     
    	     
    
	    o
    	     
    	    I   have knowledge of material adverse changes to the litigation exposure of   Company or any of its Affiliates or of any Guarantor not previously disclosed   in Exhibit D, as more fully described in the statement of facts   attached to this Certificate.
    

 

E.                                      Financial Covenants.  I further certify that:

 

(Check and complete each of the following)

 

1.                                      Minimum Book Net Worth.  Pursuant to Section 5.2(a) of the Credit Agreement, as of the Reporting Date, Company’s Book Net Worth was $[                        ], which o satisfies o does not satisfy the requirement that such amount be not less than the applicable amount set forth in the table below (numbers appearing between “< >” are negative) on the Reporting Date:

 

	    Test   Date
    	     
    	    Minimum Book Net Worth
    	     
    
	    June 30, 2010
    	     
    	    $
    	    64,346,000
    	     
    
	    September 30, 2010
    	     
    	    $
    	    57,671,000
    	     
    
	    December 31, 2010
    	     
    	    $
    	    52,983,000
    	     
    
	    March 31, 2011
    	     
    	    $
    	    50,090,000
    	     
    

 

2.                                      Minimum Net Income.  Pursuant to Section 5.2(b) of the Credit Agreement, as of the Reporting Date, Company’s Net Income was [$                    ], which o satisfies o does not satisfy the requirement that Net Income be not less than the amount set forth in the table below (numbers appearing between “< >” are negative) on the Reporting Date:

 

	    Test   Date
    	     
    	    Minimum Net Income
    	     
    
	    June 30, 2010
    	     
    	    $
    	    <11,283,000>
    	     
    
	    September 30, 2010
    	     
    	    $
    	    <9,859,000>
    	     
    
	    December 31, 2010
    	     
    	    $
    	    <7,549,000>
    	     
    
	    March 31, 2011
    	     
    	    $
    	    <5,161,000>
    	     
    

 

3.                                      Minimum Cash to Unreimbursed Line of Credit Advances Coverage Ratio.  Pursuant to Section 5.2(c) of the Credit Agreement, as of the Reporting Date, at all times, Company has o has not o been in compliance with the requirement that the percentage of the unreimbursed Line of Credit Advances under the Revolving Note plus the L/C Amount plus outstanding “Advances” under the Ex-Im Credit Agreement to the 

 

9

 

amount of cash plus Cash Equivalents of Company in which Wells Fargo has a perfected first priority security interest be not greater than 80%.

 

4.                                      Capital Expenditures.  Pursuant to Section 5.2(d) of the Credit Agreement, for the year-to-date period ending on the Reporting Date, Company has expended or contracted to expend during the fiscal year ended                               , 200      , for Capital Expenditures, $                                 in the aggregate, which o satisfies o does not satisfy the requirement that such expenditures not exceed $7,500,000 in the aggregate during the fiscal year ended March 31, 2009, $10,000,000 in the aggregate during the fiscal year ended March 31, 2010, and zero for each subsequent fiscal year.

 

Attached are statements of all relevant facts and computations in reasonable detail sufficient to evidence Company’s compliance with the financial covenants referred to above, which computations were made in accordance with GAAP.

 

	     
    	    Capstone   Turbine Corporation
    
	     
    	     
    
	     
    	    By:
    	     
    
	     
    	     
    	    Its:    Chief Financial Officer
    

 

10

 

Exhibit E-2

 

Exhibit E to Credit and Security Agreement (Ex-Im Subfacility)

 

COMPLIANCE CERTIFICATE

 

	    To:
    	     
    	    Wells   Fargo Bank, National Association
    
	    Date:
    	     
    	    [                                    ,   200  ]
    
	    Subject:
    	     
    	    Financial   Statements
    

 

In accordance with our Credit and Security Agreement (Ex-Im Subfacility) dated February 9, 2009 (as amended from time to time, the “Credit Agreement”), attached are the financial statements of Capstone Turbine Corporation (the “Company”) dated [                            , 200  ] (the “Reporting Date”) and the year-to-date period then ended (the “Current Financials”).  All terms used in this certificate have the meanings given in the Credit Agreement.

 

F.                                      Preparation and Accuracy of Financial Statements.  I certify that the Current Financials have been prepared in accordance with GAAP, subject to year-end audit adjustments, and fairly present Company’s financial condition as of the Reporting Date.

 

G.                                    Name of Company; Merger and Consolidation.  I certify that:

 

(Check one)

 

	    o
    	     
    	    Company   has not, since the date of the Credit Agreement, changed its name or   jurisdiction of organization, nor has it consolidated or merged with another   Person.
    
	     
    	     
    	     
    
	    o
    	     
    	    Company   has, since the date of the Credit Agreement, either changed its name or   jurisdiction of organization, or both, or has consolidated or merged with   another Person, which change, consolidation or merger: o was   consented to in advance by Wells Fargo in an Authenticated Record, and/or o is more   fully described in the statement of facts attached to this Certificate.
    

 

H.                                    Events of Default.  I certify that:

 

(Check one)

 

	    o
    	     
    	    I   have no knowledge of the occurrence of an Event of Default under the Credit   Agreement, except as previously reported to Wells Fargo in a Record.
    
	     
    	     
    	     
    
	    o
    	     
    	    I   have knowledge of an Event of Default under the Credit Agreement not previously   reported to Wells Fargo in a Record, as more fully described in the statement   of facts attached to this Certificate, and further, I acknowledge that   Wells Fargo may under the terms of the Credit Agreement impose the Default   Rate at any time during the resulting Default Period.
    

 

 

I.                                         Litigation Matters.  I certify that:

 

(Check one)

 

	    o
    	     
    	    I   have no knowledge of any material adverse change to the litigation exposure   of Company or any of its Affiliates or of any Guarantor.
    
	     
    	     
    	     
    
	    o
    	     
    	    I   have knowledge of material adverse changes to the litigation exposure of   Company or any of its Affiliates or of any Guarantor not previously disclosed   in Exhibit D, as more fully described in the statement of facts   attached to this Certificate.
    

 

J.                                      Financial Covenants.  I further certify that:

 

(Check and complete each of the following)

 

1.                                      Minimum Book Net Worth.  Pursuant to Section 5.2(a) of the Credit Agreement, as of the Reporting Date, Company’s Book Net Worth was $[                        ], which o satisfies o does not satisfy the requirement that such amount be not less than the applicable amount set forth in the table below (numbers appearing between “< >” are negative) on the Reporting Date:

 

	    Test   Date
    	     
    	    Minimum Book Net Worth
    	     
    
	    June 30, 2010
    	     
    	    $
    	    64,346,000
    	     
    
	    September 30, 2010
    	     
    	    $
    	    57,671,000
    	     
    
	    December 31, 2010
    	     
    	    $
    	    52,983,000
    	     
    
	    March 31, 2011
    	     
    	    $
    	    50,090,000
    	     
    

 

2.                                      Minimum Net Income.  Pursuant to Section 5.2(b) of the Credit Agreement, as of the Reporting Date, Company’s Net Income was [$                    ], which o satisfies o does not satisfy the requirement that Net Income be not less than the amount set forth in the table below (numbers appearing between “< >” are negative) on the Reporting Date:

 

	    Test   Date
    	     
    	    Minimum Net Income
    	     
    
	    June 30, 2010
    	     
    	    $
    	    <11,283,000>
    	     
    
	    September 30, 2010
    	     
    	    $
    	    <9,859,000>
    	     
    
	    December 31, 2010
    	     
    	    $
    	    <7,549,000>
    	     
    
	    March 31, 2011
    	     
    	    $
    	    <5,161,000>
    	     
    

 

3.                                      Minimum Cash to Unreimbursed Line of Credit Advances Coverage Ratio.  Pursuant to Section 5.2(c) of the Credit Agreement, as of the Reporting Date, at all times, Company has o has not o been in compliance with the requirement that the percentage of the unreimbursed “Advances” plus the L/C Amount under the Domestic Facility Agreement plus outstanding “Advances” under the Domestic Facility Agreement

 

12

 

to the amount of cash plus Cash Equivalents of Company in which Wells Fargo has a perfected first priority security interest be not greater than 80%.

 

4.                                       Capital Expenditures.  Pursuant to Section 5.2(d) of the Credit Agreement, for the year-to-date period ending on the Reporting Date, Company has expended or contracted to expend during the fiscal year ended                               , 200      , for Capital Expenditures, $                                 in the aggregate, which o satisfies o does not satisfy the requirement that such expenditures not exceed $7,500,000 in the aggregate during the fiscal year ended March 31, 2009, $10,000,000 in the aggregate during the fiscal year ended March 31, 2010, and zero for each subsequent fiscal year.

 

Attached are statements of all relevant facts and computations in reasonable detail sufficient to evidence Company’s compliance with the financial covenants referred to above, which computations were made in accordance with GAAP.

 

	     
    	    Capstone   Turbine Corporation
    
	     
    	     
    
	     
    	    By:
    	     
    
	     
    	     
    	    Its:    Chief Financial Officer
    

 

13

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