Unassociated Document


    


    


    November
      9, 2007

     

    Alternative
      Energy Sources, Inc.

    310
      West
      20th Street, 2nd Floor

    Kansas
      City, Missouri 64108 

    Attention:
      Chairman of the Board of Directors

    


     

    Dear
      Sirs:

     

    We
      are
      delighted that you have decided to consider a transaction with [Name of
      Purchaser], a privately held company (the “Purchaser”),
      pursuant to which Alternative Energy Sources, Inc. (the “Company”)
      would
      be acquired by the Purchaser (the “Transaction”),
      and
      we look forward to working with you to enter into a definitive merger agreement
      for the Transaction on terms mutually agreeable to the parties and subject
      to
      such conditions as we and you will mutually agree to in further discussions.
      The
      Purchaser and its affiliates intend to devote substantial resources to due
      diligence and the prompt preparation and completion of the necessary definitive
      agreements, but are only willing to do so subject to the provisions set out
      herein. 

     

    From
      and
after
      the date
      hereof until the earlier of (i) the execution of a definitive merger
      agreement with respect to the Transaction or (ii) one year after the date
      hereof, if the Company or any of its subsidiaries enters into an agreement
      with
      respect to an Acquisition Transaction (as defined below), the Company shall
      simultaneously with the closing of the transaction contemplated by any such
      agreement with respect to an Acquisition Transaction (1) pay to the Purchaser
      a
      business interruption fee of $500,000 (the “Business
      Interruption Fee”)
      and
      (2) reimburse the Purchaser for the reasonable fees and expenses (including,
      without limitation, fees and expenses payable to all legal, accounting,
      financial, and other professionals arising out of, in connection with or related
      to the Transaction)
      incurred
      by it and its affiliates in connection with the evaluation, negotiation,
      financing and documentation of the Transaction up to an aggregate amount of
      $500,000 (which, for the avoidance of doubt, shall be in addition to the
      Business Interruption Fee), in the case of each of clauses (1) and (2),
in
      cash
      payable by wire transfer in same day funds to an account designated in writing
      by the Purchaser.
      Notwithstanding
      anything to the contrary contained herein, if the Company fails to pay any
      amounts due under this paragraph in accordance with the terms hereof, in
      addition to any amounts paid or payable pursuant to this paragraph, the Company
      shall pay the reasonable fees and expenses (including legal fees and expenses)
      incurred in connection with any action, including the filing of any lawsuit
      or
      other legal action, taken to collect payment, together with interest on the
      unpaid amount from the date such amount was required to be paid at the prime
      rate as reported in the Wall Street Journal on the date such amount was required
      to be paid.

     

    As
      used
      in this agreement, “Acquisition
      Transaction”
means
      (1) a merger, consolidation, share exchange or business combination
      involving the Company or any of its subsidiaries representing 20% or more of
      the
      assets of the Company and its subsidiaries, taken as a whole, (2) a sale,
      lease, exchange, or transfer (other than the granting of a security interest
      in,
      or lien or mortgage on, assets of the Company), in a single transaction or
      series of related transactions, of 20% or more of the assets of the Company
      and
      its subsidiaries, taken as a whole, (3) a purchase or sale of shares of
      capital stock or other securities, in a single transaction or series of related
      transactions, representing 20% or more of the voting power of the capital stock
      of Company, including by way of a tender offer or exchange offer, (4) a
      reorganization or recapitalization of the Company (other than a bankruptcy
      reorganization), or (5) any other change-of-control transaction having a
      similar effect to those described in clauses (1) through (4), in each case
      other
      than the Transaction.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      Alternative
        Energy Sources, Inc.

      November
        9, 2007

      Page
        2 



    Notwithstanding
      anything to the contrary in the foregoing, unless and until a definitive merger
      agreement is executed and delivered in respect of the Transaction (and, in
      that
      case, subject to the conditions expressed therein), no party to this agreement
      is under any obligation to proceed with or consummate the Transaction. The
      obligations under this Agreement shall automatically terminate upon the
      execution of such definitive merger agreement, if any. The terms of this
      agreement may be modified or waived only by a separate writing, signed by the
      party against whom enforcement is sought, that expressly modifies or waives
      any
      such term. It is understood that no failure or delay in exercising any right,
      power or privilege under this agreement shall operate as a waiver hereof, nor
      shall any single or partial exercise thereof preclude any other or further
      exercise thereof or the exercise of any right, power or privilege under this
      agreement. The invalidity or unenforceability of any provision of this agreement
      shall not affect the validity or enforceability of any other provision of this
      agreement, all of which shall remain in full force and effect. 

     

    This
      agreement shall be governed by and construed in accordance with the laws of
      the
      State of New York applicable to contracts made and to be performed entirely
      within such State. The parties to this agreement (a) irrevocably submit to
      the personal jurisdiction of the state courts located in New York, New York
      and
      the federal courts of the United States of America located in the Southern
      District of the State of New York and (b) waive any claim of improper venue
      or any claim that those courts are an inconvenient forum. 

     

    [Signature
      page follows]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      Alternative
        Energy Sources, Inc.

      November
        9, 2007

      Page
        3


       

    

    This
      agreement shall
      be
      treated as confidential and may not be used, circulated, quoted or otherwise
      referred to in any document, except with the prior written consent of the
      Purchaser.

     

    Very
      truly yours,

     

    


    
      	
              [NAME
                OF PURCHASER]

            	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	
              By:

            	
              /s/[NAME
                OF PURCHASER]

            	 	 
	 	
              Name:

            	 	 
	 	
              Title:

            	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	
              ACKNOWLEDGED
                AND AGREED:

            	 	 
	 	 	 	 
	
              ALTERNATIVE
                ENERGY SOURCES, INC.

            	 	 
	 	 	 	 
	 	 	 	 
	
              By:

            	
              /s/Mark
                Beemer

            	 	 
	 	
              Name:
                Mark Beemer

            	 	 
	 	
              Title:
                Chief Executive Officer