Capstone
Turbine Corporation
21211 Nordhoff Street
Chatsworth, California 91311
The undersigned
(the “Investor”) hereby confirms and agrees with you as
follows:
1. The
subscription terms set forth herein (this
“Subscription”) are made as of the date set forth below
between Capstone Turbine Corporation, a Delaware corporation (the
“Company”), and the Investor.
2. As of the
Closing (as defined below) and subject to the terms and conditions
hereof, the Company and the Investor agree that the Investor will
purchase from the Company and the Company will issue and sell to
the Investor (i) the number of shares (the
“Shares”) of common stock, par value $0.001 per share,
of the Company (the “Common Stock”) set forth on the
signature page hereto (the “Signature Page”), and
(ii) Warrants in the form attached hereto as
Exhibit B (the “Warrants”, and together
with the Shares, the “Securities”), to purchase the
number of shares of Common Stock set forth on the Signature Page
for a purchase price of $14.90 per unit. Each unit consists of ten
Shares and Warrants to purchase three shares of Common Stock. The
Investor acknowledges that the offering is not a firm commitment
underwriting and that there is no minimum offering
amount.
3. The
completion of the purchase and sale of the Securities shall occur
at a closing (the “Closing”) that, in accordance with
Rule 15c6-1 promulgated under the Securities Exchange Act of
1934, as amended, (the “Exchange Act”) is expected to
occur on or about September 23, 2008. The date on which this
Subscription actually closes is referred to herein as the
“Closing Date”. At the Closing, (a) the Company
shall release or cause its transfer agent to release to the
Investor the number of Securities being purchased by the Investor
and (b) the Investor will deliver to the Company the aggregate
purchase price for the Securities being purchased by the Investor
(the “Purchase Price”). The Investor shall settle the
Shares via Deposit/Withdrawal At Custodian (“DWAC”) and
the provisions set forth in Exhibit A hereto shall be
incorporated herein by reference as if set forth fully herein. If
the Investor delivers the Purchase Price to the Company prior to
the Closing Date, then (i) the Company shall promptly deposit
and hold the Purchase Price in a separate interest bearing or money
market account (the “Account”) of the Company at a
financial institution of nationally recognized standing, free and
clear of all liens, security interests, pledges and other
encumbrances, until the Closing occurs (and the Company agrees
that, while in the Account, the Purchase Price shall remain the
property of the Investor) and (ii) the Company will
immediately return the Purchase Price to the Investor (by wire
transfer if the Investor shall have provided appropriate wire
transfer instructions), together with a pro rata portion of any
interest or dividends earned on the funds in the Account for each
day while the Purchase Price received from such Investor was in the
Account, if the Closing does not occur on or before
September 26, 2008 or the Placement Agreement (as defined
below) is terminated, unless otherwise agreed in writing by the
Investor.
4. The
offering and sale of the Securities are being made pursuant to the
Registration Statement and the Prospectus (as such terms are
defined below). The Investor acknowledges that the Company intends
to enter into subscriptions in substantially the same form as this
Subscription with certain other third-party investors and intends
to offer and sell (the “Offering”) up to an aggregate
of 21,485,660 shares of Common Stock and Warrants to purchase up to
an aggregate of 6,445,698 shares of Common Stock pursuant to the
Registration Statement and Prospectus. The Investor acknowledges
and agrees that there is no minimum offering amount. If the Company
enters into a subscription with a third-party investor in this
Offering on terms and conditions that are more favorable than the
terms and conditions set forth herein, the Company agrees to amend
this Subscription to reflect such terms and conditions.
5. The
Company has filed with the Securities and Exchange Commission (the
“Commission”) a registration statement (File
No.
333-128164), including all amendments thereto, if any, the exhibits
and any schedules thereto and the documents otherwise deemed to be
a part thereof or included therein by the rules and regulations of
the Commission (collectively, and including any related
registration statement that the Company may file pursuant to Rule
462(b) under the Securities Act (as defined below) to register a
portion of the Securities, the “Registration
Statement”), in conformity with the Securities Act of 1933,
as amended (the “Securities Act”), and the Company has
prepared or will prepare, as the case may be, (i) the
preliminary prospectus supplement dated September 16, 2008
(the “Preliminary Prospectus Supplement”) and the
related prospectus dated September 14, 2005 (the “Base
Prospectus” and, together with the Preliminary Prospectus
Supplement, the “Preliminary Prospectus”),
(ii) the Preliminary Term Sheet dated September 15, 2008
relating to the Offering (including the exhibits thereto, the
“Preliminary Term Sheet”), (iii) the Final Term
Sheet dated September 17, 2008 relating to the Offering
(including the exhibits thereto, the “Final Term
Sheet”) and (iv) a final prospectus supplement and
related base prospectus (together, the
“Prospectus”).
6. The
Company has entered into a Placement Agency Agreement (the
“Placement Agreement”), dated September 17, 2008
with Wachovia Capital Markets, LLC (the “Placement
Agent”), which will act as the Company’s placement
agent with respect to the Offering and receive a fee in connection
with the sale of the Securities. The Placement Agreement contains
certain representations and warranties of the Company. The Company
acknowledges and agrees that the Investor may rely on the
representations, warranties, covenants and agreements made by it in
Sections 3 and 4 of the Placement Agreement, to the same
extent as if such representations, warranties, covenants and
agreements had been set forth in full herein and made directly to
the Investor.
7. The
obligations of the Company and the Investor to complete the
transactions contemplated by this Subscription shall be subject to
the following:
(a) The
Company’s obligation to issue and sell the Securities to the
Investor shall be subject to: (i) the receipt by the Company
of the Purchase Price for the Securities being purchased hereunder
as set forth on the Signature Page and (ii) the accuracy of
the representations and warranties made by the Investor and the
fulfillment of those undertakings of the Investor to be fulfilled
prior to the Closing Date.
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(b) The
Investor’s obligation to purchase the Securities will be
subject to the condition that the Placement Agent shall not have:
(i) terminated the Placement Agreement pursuant to the terms
thereof or (ii) determined that the conditions to closing in
the Placement Agreement have not been satisfied.
8. The
Company hereby makes the following representations, warranties and
covenants to the Investor:
(a) The Company
has the requisite corporate power and authority to enter into and
to consummate the transactions contemplated by this Subscription
and otherwise to carry out its obligations hereunder. The execution
and delivery of this Subscription by the Company and the
consummation by it of the transactions contemplated hereunder have
been duly authorized by all necessary action on the part of the
Company. This Subscription h
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