Question:

How will the GE takeover of Calnetix effect the production of the 100kw microturbine and sales of the 125kW waste heat recovery generator?

Answer from Capstone Management:

G.E. is now building the 100kW microturbine, or TA100, in Stuart, Florida under subcontract to Calnetix. That manufacturing agreement will expire in March of 2011, at which time Capstone will have the right to begin manufacturing the TA100 at its California facilities.

Question:

What Capstone software/microturbine set design advantages offer cost savings as compared to a Ingersoll Rand set of four MT 250s with Dresser software?

Answer from Capstone Management:

The Capstone C200 and C1000 products are superior to the Ingersoll Rand product in several key performance characteristics. The Capstone products have higher electrical efficiency, better part load efficiency, lower weight per kW, UL 2200 and UL1741 certifications and utilize patented air bearing technology. The IR 250 has oil bearings, pumps, radiator and a low speed generator with speed reducing gearbox.   

Question:

Considering that one of the largest natural gas fields in the world is located in northwest Louisiana, do you have plans for marketing microturbines in this area? We have gas coming out our ears, seems there would be marketing opportunities in this area.

Answer from Capstone Management:

Management believes microturbine technology has significant market opportunities in America’s Big 6 shale plays – the Barnett, Bossier, Eagle Ford, Fayetteville, Haynesville and Marcellus plays. Capstone and its local area distributors have been marketing heavily to exploration and production companies involved in the plays to explain the value proposition and emission advantages of microturbine technology. Capstone has recently received several orders for projects in these U.S. shale plays and has experienced a significant increase in quotation activity in the last six months.

Question:

Does DesignLine now consider turbines to be obsolete in its bus product line?

Answer from Capstone Management:

DesignLine builds electric buses with and without on-board range extenders. However, because of the lack of recharging infrastructure and to reduce the size of on-board batteries required to serve most transit routes, approximately 80% of DesignLine’s North Carolina bus production utilizes Capstone microturbines instead of on-board range extenders.

Question:

Are you concerned with the evaporation of the share price when the company seems to be reporting increasing revenue, margin improvement, backlog, and CFP not far away? Thank You.

Answer from Capstone Management:

Management is focused on increasing revenue, improving margin, reducing backlog and achieving profitability. In the long term, management believes that the stock market will fairly value the Company based on results in these areas, among others -- not industry or market trends.