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CPST (NASDAQ) 0.42 | up0.02 | Jul 2 2015 | 16:00 ET

Ask Management

Welcome to the "Ask Management" section of our site. "Ask Management" is your opportunity to submit a question to Capstone Turbine Corporation's management team.

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NOTICE: All information submitted through this form is subject to editorial review and may or may not be responded to in the Ask Management section of our website.

This section of our web site contains "forward-looking statements," as that term is used in the federal securities laws, regarding future events or financial performance of the Company within the meaning of the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as "expects," "objective," "intend," "targeted," "plan" and similar phrases. These forward-looking statements are subject to numerous assumptions, risks and uncertainties described in Capstone's filings with the Securities and Exchange Commission that may cause Capstone's actual results to be materially different from any future results expressed or implied in such statements. We refer you to the Company's Form 10-K, Form 10-Q and other recent filings with the Securities and Exchange Commission for a description of these risk factors. Capstone cautions readers not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. Capstone undertakes no obligation, and specifically disclaims any obligation, to release any revisions to any forward-looking statements to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.



May 6, 2015

Question:

I understand Rob Gleason is gone. This is Material information but has not been announced. Why?


Answer from Capstone Management:

On April 10, 2015 Capstone issued a press release announcing that it had flattened its organizational structure to lower operating costs. The new organizational structure resulted in the elimination of three senior management level positions and in time will save the Company an estimated $2 million annually in salaries, equity, benefits, bonuses, and travel costs after the payment of associated employee severances.

Mr. Gleason held one of the three executive positions that were eliminated in the decision to flatten the organization. He was not personally named in the press release or subsequent current report on Form 8-K because the federal securities laws did not require us to disclose his departure. As a result, Jeff Foster and Tony Lorentz who reported to Mr. Gleason were promoted in the restructuring process and now report directly to the CEO. 

Mr. Jeff Foster joined Capstone on April 22, 2013 as Director, Program Management. Prior to coming to Capstone, Mr. Foster most recently served as Director, Defense Surveillance Radar and head of the Program Management Office (PMO) for the Radar, Reconnaissance, and Acoustics Business Area at Exelis Inc. (formally a part of ITT Corporation.) Mr. Foster has spent more than 26 years in program management, business development, logistics, operations, and Six Sigma with substantive domestic & international experience. Mr. Foster holds a Master of Business Administration (MBA) from The Foster School of Business at the University of Washington in Seattle, is a graduate of the ITT Leadership Development program at Ashridge University in the United Kingdom, is a Certified Six Sigma Black Belt, is a certified Project Management Professional (PMP)® from the Project Management Institute, and is a U.S. Navy veteran.

Mr. Tony Lorentz joined Capstone on November 26, 2012. Mr. Lorentz most recently served as the Director of Product Integrity for Capstone. Previous to that, Mr. Lorentz spent 18 years at Parker Hannifin Aerospace leading product development and engineering test laboratory teams. He brings extensive experience in engineering design and testing and structured product development for commercialization and technology advancement of products. Mr. Lorentz holds a Bachelor of Science Degree in Aerospace Engineering from Embry Riddle Aeronautical University.

May 6, 2015

Question:

Has Wrightspeed replaced the CPST K30 and K60 with its own Technology the Fulcrum?


Answer from Capstone Management:

Capstone has a C30 and C65 product that can be used in various electric vehicle applications. Wrightspeed recently announced it is developing a new 80kW “Fulcrum” turbine at the ACT Expo in Dallas, Texas. Capstone has been working collaboratively with Wrightspeed and founder Ian Wright for several years to develop a microturbine-based electric vehicle solution.

As of this date, we have not been formally notified by Wrightspeed of a decision to stop working with Capstone in light of them developing their own 80kW product. A Capstone C30 powered Isuzu vehicle was displayed by Wrightspeed at the ACT Expo May 4-7, 2015 in Dallas, Texas. The two vehicles that FedEx is currently testing and using for demonstration purposes are still utilizing the Capstone C30 turbines products to the best of our knowledge.

According to recent conversations with Mr. Wright all three turbines are operating satisfactorily, and the next 25 units for FedEx were delayed due to non-Capstone related Wrightspeed power train issues. Capstone is taking Wrightspeed’s “Fulcrum” turbine announcement seriously, but because of the potential legal implications that may surround this new development, Capstone will not be making any further formal statements on this matter until clarification occurs. 

May 4, 2015

Question:

Wrightspeed used our turbines and now claim 100% of the IP for their “Fulcrum” turbine. What does Capstone get out of this?


Answer from Capstone Management:

Wrightspeed recently announced at the ACT Expo in Dallas, Texas that it is developing a new 80kW “Fulcrum” turbine. Capstone has been working collaboratively with Wrightspeed and its founder, Ian Wright, for several years to develop a microturbine-based electric vehicle solution.  Capstone had no prior knowledge of the 80kW “Fulcrum” turbine and is not certain as to the maturity of the design. In addition, we are not aware of any patent applications or CARB certification requests for this new product.

Capstone and Wrightspeed have collaborated on engineering and design projects over the last few years. The contracts governing those projects give both parties rights and obligations and have strict language on what Capstone and Wrightspeed can and cannot do in relation to a microturbine-based electric vehicle solution. Capstone is taking Wrightspeed’s “Fulcrum” turbine announcement seriously, but because of the potential legal implications that may surround this new development, Capstone will not be making any further formal statements on this matter until clarification occurs. 

April 22, 2015

Question:

When are you reporting earnings?


Answer from Capstone Management:

Capstone does not publically announce scheduled earnings release dates until the completion of our quarter-end or year-end external review and audit processes have been thoroughly conducted. However, based upon the recently completed March quarter being our corporate fiscal year-end, it will most likely be mid-June when we report earnings.

April 20, 2015

Question:

Since the first listing long ago, has CPST ever had a reverse split?


Answer from Capstone Management:

No, Capstone has never done a reverse split since going public in 2000.