Question:

Who was the Feb 29 CPST direct offering of 22.5 million shares sold to: a single investor; or a few institutional investors?

Answer from Capstone Management:

The 22.6 million units were sold to two institutional investors at $1.11 per unit. Both investors had previously invested in Capstone stock and were very familiar with the Company and its management team.

Question:

Company has the right to "require' investors to buy 19 million more shares under certain conditions. What are those conditions? 

Answer from Capstone Management:

Please refer to the Current Report on Form 8-K that was filed with the Securities and Exchange Commission (“SEC”) on February 29, 2012 for a summary of the transaction. You can view this filing and all of our public filings on the SEC website at www.sec.gov or our website at www.capstoneturbine.com. 

Question:

Flaring natural gas creates an environmental, PR headache for oil producers. Would it be feasible to connect these sites to the grid and use flared gas to generate electricity for the grid?

Answer from Capstone Management:

Yes, it is feasible to export electricity generated from flare gas using Capstone products. One of Capstone’s oil & gas customers in Russia, Tatneft, is doing it today at several locations in Tatarstan.

Question:

As a shareholder in your company I always follow your news releases from the Texas Eagle Ford shale play to Singapore. I feel there is a real opportunity for co-generation in Iraq. They probably do quite a bit of flaring. Are you pursuing marketing of your products in the Middle East? As a shareholder in your company I am very interested in hearing about your plans for expansion in these regions because oil and gas comprised 59% of your revenue in for the first three quarters of Fiscal 2012.

Answer from Capstone Management:

Yes, Capstone management believes that there are significant opportunities for our microturbine technology in the Middle East. Capstone currently has distribution partners in Turkey, Pakistan, Kazakhstan, and Israel.  

In addition, Capstone recently appointed Turner Engine Powered Services as our distributor for Saudi Arabia and the United Arab Emirates. Management is very pleased to have Turner as a new distribution partner in the Middle East as well as for the United Kingdom. Turner has a long history of successful distributed generation sales, application and service.

Question:

What is the status of the Designline business? Are they producing any Hybrid buses using Capstone turbines or have they dropped that product line?

Answer from Capstone Management:

Capstone continues to work with Designline as an OEM partner, and Designline continues to offer electric transit buses utilizing Capstone’s microturbines as range extenders. Designline recently built Capstone powered buses for customers in Arlington, Virginia and Denver, Colorado.