Question:

How does the Capstone microturbine handle vehicular vibration in comparison to a zero vibration stationary machine?

Answer from Capstone Management:

The Capstone microturbine itself can handle very high vibration and shock loads. The long-term area of concern is the power electronics module. Capstone currently has a program to water cool and “harden” the current power electronics for vehicular applications.

Question:

I noticed in the Q1 conference call, that you were trying for a 30% federal rebate level for MTs to match that of other green energy producers. While it would be good to be playing on an even level rebate playing field, might it not be better to have an end goal of zero rebates for all, since the rebate on a Bloom Box fuel cell, for instance would be 30% of $7000/kW or $2100/kW. The government is in effect giving more than the price of a kW of Capstone MT as a rebate for competing product!

Answer from Capstone Management:

Management is not looking to build a business based upon unpredictable government incentives. However, Management is looking to “level the playing field” with other clean energy technology. Introducing a bill to increase the current investment tax credit for microturbines from today’s 10% to 30% is the most expeditious way of achieving that goal.        

Question:

South Korea new law requires all SK government buildings to use min 5% power from renewables in 2012. Fuel Cell Energy expects this to be huge for them. What is CPST plans on pursuing these opportunities in SK?

Answer from Capstone Management:

Capstone is working with its Distribution partner Samsung in Korea on ways to capitalize on this new opportunity. Samsung is currently one of Capstone’s top 20 distribution partners and we continue to work with them to develop the South Korean market.

Question:

Are you planning on outsourcing production, because prices still seem low, and costs still seem high? Was low pricing for market penetration, because it seems you have penetrated the market globally?

Answer from Capstone Management:

Capstone currently has no plans to outsource production from its two facilities in California as we are still running at approximately 25% of our overall plant capacity. However, Capstone sources individual parts and subassemblies globally. The initial C200 and C1000 product pricing was aggressive to gain market adoption. Capstone has increased the price of the C200 based product over 20% since the initial product launch.

Question:

I'm invested in your company and have been for several years. I have recently seen Form 4 fillings for 10,000 direct shares going to Wilk, Atkinson, Van Deursen, Mayo, Protsch and who knows how many others. Look I'm aware of the need to have directors, but if you’re going to give away 10,000 shares at a pop I want to know what is the value these Directors are having on the company that entitles them to share give a ways?

Answer from Capstone Management:

Like many companies, Capstone’s outside directors are compensated with a mix of cash and company stock. The compensation levels for our directors are reviewed against market data on an annual basis. Specific qualifications of our directors, as well as information concerning their compensation, can be found in Capstone’s latest proxy filing.