Document:

Exhibit 10.1

 

CAPSTONE TURBINE CORPORATION

 

INDUCEMENT STOCK OPTION AGREEMENT

 

THIS
AGREEMENT is entered into on this       
day of [date of agreement] by and between Capstone Turbine Corporation (the “Company”)
with [name] (the “Optionee”) to
evidence the award of an option to purchase the common stock of the Company
that was made on [grant date].

 

RECITALS:

 

WHEREAS,
the Company, through action of the compensation committee of
its board of directors taken on [date of committee action], made a conditional option
award to Optionee to purchase the Company’s Common Stock (the “Option”) as an
inducement to encourage Optionee to accept an offer of employment as the
Company’s [title of Optionee];

 

WHEREAS,
the parties, in connection therewith, entered into a letter agreement dated
[letter agreement date], that sets forth the general terms of employment of the
Optionee by the Company, including the terms of the Option that is evidenced by
this Agreement; and

 

WHEREAS,
the parties further acknowledge that this Option is granted
separately from the Capstone Turbine Corporation 2000 Equity Incentive Plan
(the “2000 Plan”), but desire that this Option be subject to the terms
contained in the 2000 Plan, except as otherwise provided for herein;

 

NOW,
THEREFORE, in consideration of these premises, and other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties do hereby agree to the following terms and conditions
regarding the Option covered hereby:

 

I.                                         NOTICE OF
STOCK OPTION GRANT

 

Notice
is hereby given of the grant of the Option, subject to the following terms.
References in this Agreement to certain terms of the Option shall be as defined
in this Article I:

 

	
  Date of Grant:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Exercise Price:

  	
   

  	
  $        per Share

  
	
   

  	
   

  	
   

  
	
  Total Number of Shares:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Total Exercise Price:

  	
   

  	
  $           

  
	
   

  	
   

  	
   

  
	
  Type of Option:

  	
   

  	
  Non-Qualified Stock
  Option

  
	
   

  	
   

  	
   

  
	
  Term:

  	
   

  	
  10 years commencing on
  Date of Grant

  

 

 

Exercise and Vesting
Schedule:

 

This Option shall vest
and become exerciseable on the dates and as described in this paragraph,
subject to the Optionee continuing to be either an Employee or a Consultant to
the Company on such vesting dates. On [1 year
anniversary of grant date], Optionee shall be vested in and have the
right to exercise the Option with respect to [                ]
Shares. Thereafter, Optionee shall become vested in and have the right to
exercise this Option with respect to 1/48th of
the number of Shares subject to the Option on the day of each month
corresponding to the Date of Grant, so that the Option shall be fully vested
and exercisable on the fourth anniversary of the Date of Grant. However, if
Optionee is terminated by the Company other than for Cause prior to the
one-year anniversary of the Date of Grant, Optionee shall become vested in and
have the right to exercise this Option with respect to 1/48th of
the number of Shares subject to the Option for each full month of employment
following the Date of Grant, based on the day of the month corresponding to the
Date of Grant, through the date of such termination.

 

Option Termination:

 

The Option shall
terminate on [ten year anniversary of grant
date]; provided, however, that if Optionee ceases to be either an
Employee or a Consultant prior thereto, then the Option shall terminate earlier
pursuant to the terms of Sections 10(d), 10(e), and 10(f) of the 2000
Plan.

 

II.                                     AGREEMENT

 

1.             Grant of Option. The Option to purchase the
Shares of Common Stock is subject to the terms set forth in Article I of
this Agreement. Except as expressly provided for herein, this Option is also
subject to the terms, definitions and provisions of the 2000 Plan, which are
incorporated herein by reference. All capitalized terms used in this Agreement
shall have the meanings ascribed to such terms in the 2000 Plan, except as may
be otherwise defined herein. The Option evidenced in this Agreement is intended
by the parties to be granted in fulfillment of the Company’s obligation to
award a stock option pursuant to the letter agreement between the parties dated
[date of letter agreement]; the terms of this Agreement completely replace and
supersede the terms addressing the subject matter contained in such letter
agreement.

 

2.            Exercise of Option. The
Option shall be exercisable cumulatively according to the vesting schedule set
forth in Article I of this Agreement, based on Optionee’s continued status
as an Employee or a Consultant, and subject to the procedures and methods for
payment set forth in the 2000 Plan. Any portion of the exercisable portion of
the Option may be exercised at any time by the Optionee until the Option has
terminated.

 

3.             Lock-Up Period. Optionee hereby agrees that if so
requested by the Company or any representative of the underwriters (the “Managing
Underwriter”) in connection with any registration of the offering of any
securities of the Company under the Securities Act of 1933, as amended (“Securities
Act”), or any applicable state laws, Optionee shall not sell or otherwise
transfer any Shares or other securities of the Company during the 180-day
period (or such longer period as may be requested in writing by the Managing
Underwriter and agreed to in writing by the Company) (the “Market Standoff
Period”) following the effective date of a registration statement of the
Company filed under the Securities Act. The Company may impose stop-transfer
instructions with respect to securities subject to the foregoing restrictions
until the end of such Market Standoff Period.

 

 

4.             Non-Transferability of Option. The Option may not
be transferred in any manner except by will or by the laws of descent or
distribution. It may be exercised during the lifetime of Optionee only by
Optionee. The terms of the Option shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.

 

This Agreement may be
executed in two or more counterparts, each of which shall be deemed an original
and all of which shall constitute one document.

 

	
   

  	
  CAPSTONE TURBINE
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  

 

OPTIONEE
ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE OPTION
HEREOF IS EARNED ONLY BY CONTINUING EMPLOYMENT OR CONSULTANCY AT THE WILL OF
THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THE OPTION OR
ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT
NOTHING IN THIS STOCK OPTION AGREEMENT, NOR IN THE CAPSTONE TURBINE CORPORATION
2000 EQUITY INCENTIVE PLAN, WHICH IS INCORPORATED HEREIN BY REFERENCE, SHALL
CONFER UPON OPTIONEE ANY RIGHT WITH RESPECT TO CONTINUATION OF EMPLOYMENT OR
CONSULTANCY BY THE COMPANY, NOR SHALL IT INTERFERE IN ANY WAY WITH OPTIONEE’S
RIGHT OR THE COMPANY’S RIGHT TO TERMINATE OPTIONEE’S EMPLOYMENT OR CONSULTANCY
AT ANY TIME, WITH OR WITHOUT CAUSE.

 

Optionee hereby
acknowledges receipt of the 2000 Plan and a current prospectus for the offering
represented by the grant of this Option. Optionee represents that he is
familiar with the terms and provisions of the 2000 Plan and this Agreement and
does hereby accept the Option subject to all of its terms. Optionee has had an opportunity
to obtain the advice of counsel prior to executing this Agreement and fully
understands all provisions of this Agreement and the Option granted hereunder.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Committee upon any questions arising under the 2000
Plan or this Agreement. Optionee further agrees to notify the Company upon any
change in the residence address indicated below.

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
  Optionee

  
	
   

  	
   

  
	
   

  	
  Residence Address:Exhibit 10.2

 

CAPSTONE TURBINE CORPORATION

 

INDUCEMENT RESTRICTED STOCK UNIT AGREEMENT

 

THIS
AGREEMENT is entered into on this       
day of [date of agreement] by and between Capstone Turbine Corporation (the “Company”)
with [name] (“Executive”) to
evidence the award of the common stock of the Company that was made on [date of
grant].

 

RECITALS:

 

WHEREAS,
the Company, through action of the compensation committee of
its board of directors taken on [date of committee meeting], made a conditional
award of the Company’s Common Stock (the “Award”) as an inducement to encourage
Executive to accept an offer of employment as the Company’s [title of
Executive];

 

WHEREAS,
the parties, in connection therewith, entered into a letter agreement dated
[date of letter agreement], that sets forth the general terms of employment of
the Executive by the Company, including the terms of the Award that is
evidenced by this Agreement; and

 

WHEREAS,
the parties further acknowledge that this Award is granted
separately from the Capstone Turbine Corporation 2000 Equity Incentive Plan
(the “2000 Plan”), but desire that this Award be subject to the terms contained
in the 2000 Plan, except as otherwise provided for herein;

 

NOW,
THEREFORE, in consideration of these premises, and other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties do hereby agree to the following terms and conditions
regarding the Award covered hereby:

 

I.                                         NOTICE OF
STOCK AWARD

 

Notice
is hereby given of the grant of the Award, subject to the following terms.
References in this Agreement to certain terms of the Award shall be as defined
in this Article I:

 

	
  Date of Grant:

  	
   

  
	
   

  	
   

  
	
  Total Number of Shares:

  	
   

  
	
   

  	
   

  
	
  Type of Award:

  	
  Restricted Stock Units

  
	
   

  	
   

  
	
  Term for Vesting:

  	
   

  

 

 

Transfer of Shares;
Vesting Schedule:

 

Pursuant to the Award,
ownership of the Common Stock shall be transferred to Executive on the dates
and in the amounts described in this paragraph, subject to the Executive
continuing to be either an Employee or a Consultant to the Company on such
dates:

 

	
  Transfer
  Date

  	
   

  	
  Shares
  Transferred

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

The Common Stock
transferred to Executive pursuant to this Award shall be fully vested and not
subject to restrictions or forfeiture on the respective transfer dates, except
as provided in this Agreement. If Executive’s employment is terminated by the
Company other than for Cause prior to the one-year anniversary of the Date of
Grant, Executive shall become vested in and have the vested right to receive a
transfer of the Common Stock under this Award with respect to 1/48th of the number of Shares subject to the Award
for each full month of employment following the Date of Grant, based on the day
of the month corresponding to the Date of Grant, through the date of such
termination.

 

Award Termination:

 

The Award shall terminate
on the date that Executive ceases to be either an Employee or a Consultant of
the Company. Upon termination, any unvested portion of the Award will lapse.

 

II.                                     AGREEMENT

 

1.             Grant of Award.
This Award is subject to the terms set forth in Article I of this
Agreement and, except as expressly provided for herein, the terms, definitions
and provisions of the 2000 Plan regarding awards of Common Stock (including
Stock Bonus grants), which are incorporated herein by reference. All
capitalized terms used in this Agreement shall have the meanings ascribed to
such terms in the 2000 Plan, except as may be otherwise defined herein. The
Award evidenced in this Agreement is intended by the parties to be granted in
fulfillment of the Company’s obligation to award restricted stock pursuant to
the letter agreement between the parties dated [date of letter agreement]; the
terms of this Agreement completely replace and supersede the terms addressing
the subject matter contained in such letter agreement.

 

2.             Status of
Executive. The Executive shall not be deemed a stockholder of the Company
with respect to Common Stock covered by this Award and shall not be entitled to
receive dividends and exercise voting rights with respect thereto until such
Shares are Transferred to Executive on the dates described in Article I of
this Agreement. The Company is not required to deliver shares of Common Stock
to the Participant until 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. Any certificates representing the
shares of Common Stock awarded pursuant to this Agreement shall be issued in
the Participant’s name.

 

2

 

3.             Tax Withholding. At the time that any portion of the Award
becomes vested and Shares are transferred to the Executive, the Company shall
withhold from the Shares to be delivered to Executive 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 entity or
entities on behalf of the Executive with respect to such transaction. The
parties may make different arrangements for tax withholdings through a written
agreement.

 

4.             No Effect on Capital
Structure.  This Award 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.

 

5.             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.

 

6.             Lock-Up Period.
Executive hereby agrees that if so requested by the Company or any
representative of the underwriters (the “Managing Underwriter”) in connection
with any registration of the offering of any securities of the Company under
the Securities Act of 1933, as amended (“Securities Act”), or any applicable state
laws, Executive shall not sell or otherwise transfer any Shares or other
securities of the Company during the 180-day period (or such longer period as
may be requested in writing by the Managing Underwriter and agreed to in
writing by the Company) (the “Market Standoff Period”) following the effective
date of a registration statement of the Company filed under the Securities Act.
The Company may impose stop-transfer instructions with respect to securities
subject to the foregoing restrictions until the end of such Market Standoff
Period.

 

7.             Non-Transferability
of Award. The Award may not be transferred in any manner except by will or
by the laws of descent or distribution. It may be exercised during the lifetime
of Executive only by Executive. The terms of the Award shall be binding upon
the executors, administrators, heirs, successors and assigns of the Executive.

 

This Agreement may be
executed in two or more counterparts, each of which shall be deemed an original
and all of which shall constitute one document.

 

	
   

  	
  CAPSTONE TURBINE
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  

 

EXECUTIVE
ACKNOWLEDGES AND AGREES THAT THE TRANSFER AND VESTING OF SHARES PURSUANT TO
THIS AWARD IS EARNED ONLY BY CONTINUING EMPLOYMENT OR CONSULTANCY AT THE WILL
OF THE COMPANY (NOT THROUGH THE ACT OF BEING

 

3

 

HIRED, BEING
GRANTED THE AWARD OR ACQUIRING SHARES HEREUNDER). EXECUTIVE FURTHER
ACKNOWLEDGES AND AGREES THAT NOTHING IN THIS AGREEMENT, NOR IN THE CAPSTONE
TURBINE CORPORATION 2000 EQUITY INCENTIVE PLAN, WHICH IS INCORPORATED HEREIN BY
REFERENCE, SHALL CONFER UPON EXECUTIVE ANY RIGHT WITH RESPECT TO CONTINUATION
OF EMPLOYMENT OR CONSULTANCY BY THE COMPANY, NOR SHALL IT INTERFERE IN ANY WAY
WITH EXECUTIVE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE EXECUTIVE’S
EMPLOYMENT OR CONSULTANCY AT ANY TIME, WITH OR WITHOUT CAUSE.

 

Executive hereby
acknowledges receipt of the 2000 Plan and a current prospectus for the offering
represented by the grant of this Award. Executive represents that he is
familiar with the terms and provisions of the 2000 Plan and this Agreement and
does hereby accept the Award subject to all of its terms. Executive has had an
opportunity to obtain the advice of counsel prior to executing this Agreement
and fully understands all provisions of this Agreement and the Award granted
hereunder. Executive hereby agrees to accept as binding, conclusive and final
all decisions or interpretations of the Committee upon any questions arising
under the 2000 Plan or this Agreement. Executive further agrees to notify the
Company upon any change in the residence address indicated below.

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
  [name]

  
	
   

  	
   

  
	
   

  	
  Residence Address:

  	
   

  

 

 

4

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