Document:

Exhibit
4.1

 

FIFTH
AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

 

This
FIFTH AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT (this “Agreement”)
is entered into as of  November 1, 2007
by and among (i) EnerNOC, Inc., a Delaware corporation (the “Company”); (ii)
the individuals and entities listed under the heading “Investors” on the
signature pages hereto; (iii) the Founders; and (iv) each person who shall,
after the date hereof, join in and become a party to this Agreement by
executing and delivering to the Company an Instrument of Accession in
substantially the form set forth on Schedule I hereto (collectively, the
“Investors”).

WHEREAS,
the Company entered into that certain Investors Rights Agreement dated June 17,
2003 (the “Original Agreement”) with certain of the Investors listed
under the heading “Investors” on the signature pages thereto (the “Original
Stockholders”);

WHEREAS,
those Investors holding shares of the Company’s Series A Convertible Preferred
Stock, $.001 par value (the “Series A Preferred Stock”) subsequently
acquired shares of the Company’s Series A-1 Convertible Preferred Stock, $.001
par value (“Series A-1 Preferred Stock”);

WHEREAS,
the Company entered into that certain Amended and Restated Investor Rights
Agreement dated January 11, 2005 with the Original Stockholders, the Investors
holding shares of Series A-1 Preferred Stock and the Investors holding shares
of the Company’s Series B Convertible Preferred Stock, $.001 par value (“Series
B Preferred Stock”);

WHEREAS,
the Company entered into that certain Second Amended and Restated Investor
Rights Agreement dated May 16, 2006 with the Original Stockholders and the
Investors holding shares of Series A-1 Preferred Stock, the Investors holding
shares of Series B Preferred Stock and the Investors holding shares of the
Company’s Series B-1 Convertible Preferred Stock, $.001 par value (“Series
B-1 Preferred Stock”);

WHEREAS,
the Company entered into that certain Third Amended and Restated Investor
Rights Agreement dated December 29, 2006 with the Original Stockholders and the
Investors holding shares of Series A-1 Preferred Stock, the Investors holding
shares of Series B Preferred Stock, the Investors holding shares of Series B
Preferred Stock and the Investors holding shares of the Company’s Series C
Convertible Preferred Stock, $.001 par value (“Series C Preferred Stock”);

WHEREAS,
the Company entered into that certain Fourth Amended and Restated Investor
Rights Agreement dated May 11, 2007 (the “Restated Agreement”) with the
Original Stockholders and the Investors holding shares of Series A-1 Preferred
Stock, the Investors holding shares of Series B Preferred Stock, the Investors
holding shares of Series B-1 Preferred Stock, the Investors holding shares of
the Company’s Series C Convertible Preferred Stock, $.001 par value (“Series
C Preferred Stock”) and the Founders;

WHEREAS,
pursuant to Section 6.4 of the Restated Agreement, the Company and the
requisite number of Major Investors desire to amend and restate the Restated
Agreement in order to, among other things, designate stockholders who have
registration rights in the Company’s Second Public Offering (as defined
herein); and

WHEREAS,
the Company and the Investors desire to provide for certain arrangements with
respect to, among other things the registration of shares of capital stock of
the Company under the Securities Act of 1933.

NOW,
THEREFORE, in consideration of the mutual promises and covenants herein
contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, hereby agree as follows:

ARTICLE I

DEFINITIONS

1.1           Certain Definitions.  As used in this Agreement, the following
terms shall have the following meanings:

“Board
of Directors” shall mean the board of directors of the Company as
constituted from time to time.

“Braemar”
shall mean Braemar Energy Ventures, LP.

“Commission”
shall mean the Securities and Exchange Commission, or any other federal agency
at the time administering the Securities Act.

“Common
Stock” shall mean the Common Stock, par value $.001 per share, of the
Company, as constituted as of the date of this Agreement.

“Conversion
Shares” shall mean shares of Common Stock issued or issuable upon
conversion of the Preferred Shares.

“DFJ-NE”
shall mean Draper Fisher Jurvetson New England Fund I, L.P.

“Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended, or any
similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.

“Foundation
Capital” shall mean Foundation Capital IV, L.P., FC IV Active Advisors, LLC
and Foundation Capital IV Principals Fund, LLC.

“Founders”
shall mean David B. Brewster and Timothy G. Healy.

“Initial
Public Offering” shall mean the initial public offering of the Company’s
Common Stock in which (i) the market capitalization of the Company is at least
$50,000,000 and (ii) the aggregate gross proceeds (before deduction of
underwriting discounts and registration expenses) from such offering to the
Company are at least $10,000,000 pursuant to an effective registration under
the Securities Act covering the offer and sale of the Common Stock.

“Major
Investor” shall mean any Investor which holds at least 500,000 shares of
Preferred Stock, appropriately adjusted to reflect stock splits, stock
dividends, combinations of shares and the like.

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“Material
Adverse Effect (Change)” shall mean a material adverse effect (change) in
the business, operations, affairs, or condition (financial or otherwise) of the
Company.

“Overallotment
Shares” has the meaning specified in Section 2.14(d) hereof.

“Person”
or “Persons” shall mean an individual, corporation, partnership, joint
venture, trust, limited liability company, or unincorporated organization, or a
government or any agency or political subdivision thereof.

“Preferred
Shares” shall mean the shares of Series C Preferred Stock, Series B
Preferred Stock, Series B-1 Preferred Stock, Series A-1 Preferred Stock and
Series A Preferred Stock.

“Preferred
Stock” shall mean the Company’s Preferred Stock, par value $.001 per share,
and each series thereof.

“Registration
Expenses” shall mean the expenses so described in Section 2.8.

“Restricted
Stock” shall mean the Conversion Shares, excluding Conversion Shares which
have been (a) included in a transaction registered under the Securities Act
pursuant to an effective registration statement filed thereunder and disposed
of in accordance with the registration statement covering them or (b) publicly
sold pursuant to Rule 144 under the Securities Act; and, for purposes of
Sections 2.7, 2.8 and 2.9 only, any shares of Common Stock held by the
Specified Officers that are included in the Second Public Offering.

“Second
Public Offering” shall mean the first fully underwritten, firm commitment
public offering following the Initial Public Offering, pursuant to an effective
registration under the Securities Act covering the offer and sale by the
Company of its Common Stock in which (i) the market capitalization of the
Company is at least $50,000,000 and (ii) the aggregate gross proceeds (before
deduction of underwriting discounts and registration expenses) from such
offering to the Company are at least $10,000,000.

“Second
Public Offering Registration Statement” has the meaning specified in
Section 2.14(a) hereof.

“Securities
Act” shall mean the Securities Act of 1933 or any similar federal statute,
and the rules and regulations of the Commission thereunder, all as the same
shall be in effect at the time.

“Selling
Expenses” shall mean the expenses so described in Section 2.8.

“Specified
Officers” means Timothy Healy, David Brewster, Neal Isaacson, David
Samuels, Gregg Dixon and Terry Sick.

 “Subsidiary” or “Subsidiaries”
shall mean any corporation or trust of which the Company and/or any of its
other Subsidiaries (as herein defined) directly or indirectly owns at the time
outstanding shares of every class of such corporation or trust other than
directors’ qualifying shares comprising at least fifty percent (50%) of the
voting power of such corporation or trust.

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ARTICLE II

RESTRICTIONS ON TRANSFER AND REGISTRATION RIGHTS

2.1           Restrictive Legend. 
Each certificate representing Preferred Shares, Conversion Shares or
Restricted Stock shall, except as otherwise provided in this Section 2.1 or in
Section 2.2, be stamped or otherwise imprinted with a legend substantially in
the following form:

“The
securities represented by this certificate have not been registered under the
Securities Act of 1933 or applicable state securities laws.  These securities have been acquired for
investment and not with a view to distribution or resale, and may not be sold,
mortgaged, pledged, hypothecated or otherwise transferred without an effective
registration statement for such securities under the Securities Act of 1933 and
applicable state securities laws, or the availability of an exemption from the
registration provisions of the Securities Act of 1933 and applicable state
securities laws.”

A
certificate shall not bear such legend if in the opinion of counsel
satisfactory to the Company the securities represented thereby may be publicly
sold without registration under the Securities Act and any applicable state
securities laws.

2.2           Notice of Proposed Transfer.  Prior to any proposed transfer of any
Preferred Shares, Conversion Shares or Restricted Stock (other than under the
circumstances described in Section 2.3, 2.4, 2.5 or 2.6), the holder thereof
shall give written notice to the Company of its intention to effect such
transfer.  Each such notice shall
describe the manner of the proposed transfer and, if requested by the Company,
shall be accompanied by an opinion of counsel reasonably satisfactory to the
Company to the effect that the proposed transfer may be effected without
registration under the Securities Act and any applicable state securities laws,
whereupon the holder of such stock shall be entitled to transfer such stock in
accordance with the terms of its notice; provided, however, that no such
opinion of counsel shall be required for a transfer to one or more partners or
members of the transferor (in the case of a transferor that is a partnership or
a limited liability company, respectively) or to an affiliated corporation (in
the case of a transferor that is a corporation); provided, further, however,
that any transferee shall execute and deliver to the Company a representation
letter in form reasonably satisfactory to the Company’s counsel to the effect
that the transferee is acquiring such shares for its own account, for
investment purposes and without any view to distribution thereof.  Each certificate for Preferred Shares,
Conversion Shares or Restricted Stock transferred as above provided shall bear
the legend set forth in Section 2.1, except that such certificate shall not
bear such legend if (i) such transfer is in accordance with the provisions of
Rule 144 (or any other rule permitting public sale without registration under the
Securities Act) or (ii) the opinion of counsel referred to above is to the
further effect that the transferee and any subsequent transferee (other than an
affiliate of the Company) would be entitled to transfer such securities in a
public sale without registration under the Securities Act.  The restrictions provided for in this Section
2.2 shall not apply to securities which are not required to bear the legend
prescribed by Section 2.1 in accordance with the provisions of that Section.

2.3           Initial Public Offering.  If the Company at any time proposes its
Initial Public Offering, it will give notice to the Founders of its intention
to do so.  Upon the written request of
any Founder to register any of its Restricted Stock, the Company will use its
best efforts to cause 

 

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the Restricted Stock as to which registration shall
have been so requested to be included in the securities to be covered by the
registration statement proposed to be filed by the Company, all to the extent
requisite to permit the sale or other disposition by the Founder of such
Restricted Stock so registered. The number of shares of Restricted Stock to be
included in the Initial Public Offering may be reduced (pro rata among the
requesting Founders based upon the number of shares of Restricted Stock owned
by the Founders) if and to the extent that the managing underwriter shall be of
the opinion that such inclusion would adversely affect the marketing of the
securities to be sold by the Company therein, provided, however, that such number of
shares of Restricted Stock shall not be reduced if any shares are to be
included in such underwriting for the account of any person other than the
Company or the Founders.  For purposes of
this Section 2.3 and Sections 2.4, 2.5, 2.6, 6.1 and 6.4, the term “Restricted
Stock” shall be deemed to include the number of shares of Restricted Stock
which would be issuable to a holder of Preferred Shares upon conversion of all
shares of Preferred Stock; provided, however, that the only
securities which the Company shall be required to register pursuant hereto
shall be shares of Common Stock; provided, further, however,
that, in any underwritten public offering contemplated by this Section 2.3 or
Sections 2.4, 2.5 and 2.6, the holders of Preferred Shares shall be
entitled to sell such Preferred Shares to the underwriters for conversion and
sale of the shares of Common Stock issued upon conversion or exercise and
conversion, as applicable, thereof.

2.4           Required Registration.

(a)           At any time after the earlier of (i) six (6) years from
the first day on which any shares of Preferred Stock are outstanding or (ii)
one year after the Initial Public Offering, the holders of Restricted Stock
constituting at least 20% in interest of the total shares of Restricted Stock
then outstanding may request the Company to register under the Securities Act
at least 20% of the shares of Restricted Stock held by such requesting holder
or holders (or any lesser percentage if the anticipated gross receipts by such
holders of Restricted Stock from the proposed registration exceed $2,000,000)
for sale in the manner specified in such notice.  Notwithstanding anything to the contrary
contained herein, no request may be made under this Section 2.4 within 180 days
after the effective date of the first registration statement on Form S-1 filed
by the Company.  If the offering is to be
underwritten, the initiating holders shall select the underwriters and the
managing underwriters (subject to the consent of the Company, which consent
will not be unreasonably withheld).

(b)           Following receipt of any notice under this Section 2.4,
the Company shall immediately (subject to any lock-up agreement the Company has
in connection with the Second Public Offering) notify all holders of Restricted
Stock and Preferred Shares from whom notice has not been received and such
holders shall then be entitled within 15 days thereafter to request the Company
to include in the requested registration all or any portion of their shares of
Restricted Stock.  The Company shall use
its best efforts to register under the Securities Act, for public sale in
accordance with the method of disposition described in paragraph (a) above, the
number of shares of Restricted Stock specified in such notice (and in all
notices received by the Company from other holders within 15 days after the
giving of such notice by the Company). 
The Company shall be obligated to register Restricted Stock pursuant to
this Section 2.4 on two occasions only (except for registrations on Form S-3 or
any equivalent successor form); provided, however, that such
obligation shall be deemed satisfied with respect to each such occasion only
when a registration statement covering seventy-five percent (75%) of the shares
of 

 

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Restricted Stock specified in notices received as
aforesaid for sale in accordance with the method of disposition specified by
the requesting holders shall have become effective or if such registration statement
has been withdrawn prior to the consummation of the offering at the request of
the holders of Restricted Stock and Preferred Shares (other than as a result of
a Material Adverse Change) and, if such method of disposition is a firm
commitment underwritten public offering, all such shares shall have been sold
pursuant thereto (including shares sold pursuant to the underwriters’
over-allotment option).

(c)           The Company shall be entitled to include in any
registration statement referred to in this Section 2.4 shares of Common Stock
to be sold by the Company for its own account, except as and to the extent
that, in the opinion of the managing underwriter, such inclusion would
adversely affect the marketing of the Restricted Stock to be sold.  Except for registration statements on Form
S-4, S-8 or any successor thereto, the Company will not file with the
Commission any other registration statement with respect to its Common Stock,
whether for its own account or that of other stockholders, from the date of receipt
of a notice from requesting holders requesting sale pursuant to an underwritten
offering pursuant to this Section 2.4 until the completion of the period of
distribution of the registration contemplated thereby.

(d)           If in the opinion of the managing underwriter the
inclusion of all of the Restricted Stock requested to be registered under this
Section would adversely affect the marketing of such shares, shares to be sold
by the holders of Restricted Stock, if any, shall be excluded only after any
shares to be sold by the Company have been excluded, in such manner that the
shares to be sold shall be allocated among the selling holders pro  rata based on
their ownership of Restricted Stock.

2.5           Incidental Registration.  If the Company at any time after the Second
Public Offering (other than pursuant to Sections 2.4 or 2.6) proposes to
register any of its securities under the Securities Act for sale to the public,
whether for its own account or for the account of other security holders or
both (except with respect to registration statements on Forms S-4, S-8 or
another form not available for registering the Restricted Stock for sale to the
public), each such time it will give written notice to all holders of
outstanding Restricted Stock of its intention so to do.  Upon the written request of any such holder,
received by the Company within 15 days after the giving of any such notice by
the Company, to register any of its Restricted Stock, the Company will use its
best efforts to cause the Restricted Stock as to which registration shall have
been so requested to be included in the securities to be covered by the
registration statement proposed to be filed by the Company, all to the extent
requisite to permit the sale or other disposition by the holder of such Restricted
Stock so registered.  In the event that
any registration pursuant to this Section 2.5 shall be, in whole or in part, an
underwritten public offering of Common Stock, the number of shares of
Restricted Stock to be included in such an underwriting may be reduced (pro
rata among the requesting holders based upon the number of shares of Restricted
Stock owned by such holders) if and to the extent that the managing underwriter
shall be of the opinion that such inclusion would adversely affect the marketing
of the securities to be sold by the Company therein, provided, however, that
such number of shares of Restricted Stock shall not be reduced if any shares
are to be included in such underwriting for the account of any person other
than the Company or requesting holders of Restricted Stock, and provided,
further, however, that in no event may less than twenty percent (20%) of the
total number of shares of Common Stock to be included in such underwriting be
made available for shares of Restricted

 

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Stock unless the
underwriting is in connection with the Company’s initial public offering and
the managing underwriter shall in good faith advise the holders proposing to
distribute their securities through such underwriting that such level of
participation would, in its opinion, materially adversely affect the offering
price or its ability to complete the offering and shall specify the number of
shares of Restricted Stock which, in its opinion, can be included in the
registration and underwriting without such an effect.

2.6           Registration on Form S-3.  If at any time (i) a holder or holders of
Restricted Stock request that the Company file a registration statement on Form
S-3 or any successor thereto for a public offering of all or any portion of the
shares of Restricted Stock held by such requesting holder or holders and the
reasonably anticipated aggregate price to the public of such shares of
Restricted Stock equals or exceeds $500,000, and (ii) the Company is a
registrant entitled to use Form S-3 or any successor thereto to register such
shares, then the Company shall use its best efforts to register under the
Securities Act on Form S-3 or any successor thereto, for public sale in
accordance with the method of disposition specified in such notice, the number
of shares of Restricted Stock specified in such notice.  Whenever the Company is required by this
Section 2.6 to use its best efforts to effect the registration of Restricted
Stock, each of the procedures and requirements of Section 2.4 (including but not
limited to the requirement that the Company notify all holders of Restricted
Stock from whom notice has not been received and provide them with the
opportunity to participate in the offering) shall apply to such registration;
provided, however, that there shall be no limitation on the number of
registrations on Form S-3 which may be requested and obtained under this
Section 2.6; and provided, further, however, that the requirements contained in
the first sentence of Section 2.4(a) shall not apply to any registration on
Form S-3 which may be requested and obtained under this Section  2.6.

Notwithstanding
anything to the contrary in this Section 2.6, the Company shall not be required
to effect more than two registrations pursuant to this Section 2.6 in any 12
month period.

2.7           Registration Procedures.  If and whenever the Company is required by
the provisions of Sections 2.3, 2.4, 2.5, 2.6 or 2.14 to use its best efforts
to effect the registration of any shares of Restricted Stock under the
Securities Act, the Company will, as expeditiously as possible:

(a)           prepare and file with the Commission a registration
statement (which, in the case of an underwritten public offering pursuant to
Section 2.4, shall be on Form S-1 or other form of general applicability satisfactory
to the managing underwriter selected as therein provided) with respect to such
securities and use its best efforts to cause such registration statement to
become and remain effective for the period of the distribution contemplated
thereby (determined
as hereinafter provided);

(b)           prepare
and file with the Commission such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may
be necessary to keep such registration statement effective for the period
specified in paragraph (a) above and comply with the provisions of the
Securities Act with respect to the disposition of all Restricted Stock covered
by such registration statement in accordance with the sellers’ intended method
of disposition set forth in such registration statement for such period;

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(c)           furnish to each seller of Restricted Stock and to each
underwriter such number of copies of the registration statement and the
prospectus included therein (including each preliminary prospectus) as such
persons reasonably may request in order to facilitate the public sale or other
disposition of the Restricted Stock covered by such registration statement;

(d)           use its best efforts to register or qualify the Restricted
Stock covered by such registration statement under the securities or “blue sky”
laws of such jurisdictions as the sellers of Restricted Stock or, in the case
of an underwritten public offering, the managing underwriter reasonably shall request;
provided, however, that the Company shall not for any such
purpose be required to qualify generally to transact business as a foreign
corporation in any jurisdiction where it is not so qualified or to consent to
general service of process in any such jurisdiction;

(e)           use its best efforts to list the Restricted Stock covered
by such registration statement with any securities exchange on which the Common
Stock of the Company is then listed;

(f)            provide a transfer agent and registrar for all such Restricted
Stock, not later than the effective date of such registration statement;

(g)           immediately notify each seller of Restricted Stock and
each underwriter under such registration statement, at any time when a
prospectus relating thereto is required to be delivered under the Securities
Act, of the happening of any event of which the Company has knowledge as a
result of which the prospectus contained in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing;

(h)           if the offering is underwritten and at the request of any
seller of Restricted Stock, use its best efforts to furnish on the date that
Restricted Stock is delivered to the underwriters for sale pursuant to such
registration:  (i) an opinion dated such
date of counsel representing the Company for the purposes of such registration,
addressed to the underwriters and to such seller, to such effect as reasonably
may be requested by counsel for the underwriters and (ii) a letter dated such
date from the independent public accountants retained by the Company, addressed
to the underwriters and to such seller, stating that they are independent
public accountants within the meaning of the Securities Act and that, in the
opinion of such accountants, the financial statements of the Company included
in the registration statement or the prospectus, or any amendment or supplement
thereof, comply as to form in all material respects with the applicable
accounting requirements of the Securities Act, and such letter shall
additionally cover such other financial matters (including information as to
the period ending no more than five business days prior to the date of such
letter) with respect to such registration as such underwriters reasonably may
request;

(i)            make available for inspection by each seller of
Restricted Stock, any underwriter participating in any distribution pursuant to
such registration statement, and any attorney, accountant or other agent
retained by such seller or underwriter, all financial and other records,
pertinent corporate documents and properties of the Company, and cause the
Company’s 

 

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officers, directors and employees to supply all
information reasonably requested by any such seller, underwriter, attorney,
accountant or agent in connection with such registration statement.  The rights granted pursuant to this
subsection (i) may not be assigned or otherwise conveyed by such person or by
any subsequent transferee of any such rights without the written consent of the
Company, which consent shall not be unreasonably withheld; provided, however,
that the Company may refuse such written consent if the proposed transferee is
a competitor of the Company as determined by the Board of Directors; and provided,
further, that no such written consent shall be required if the transfer
is made to a party who is not a competitor of the Company and who is a parent,
subsidiary, affiliate, partner or group member of such person;

(j)            advise each selling holder of Restricted Stock, promptly
after it shall receive notice or obtain knowledge thereof, of the issuance of
any stop order by the Commission suspending the effectiveness of such
registration statement or the initiation or threatening of any proceeding for
such purpose and promptly use all reasonable efforts to prevent the issuance of
any stop order or to obtain its withdrawal if such stop order should be issued;

(k)           cooperate with the selling holders of Restricted Stock and
the managing underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Restricted Stock to be sold, such
certificates to be in such denominations and registered in such names as such
holders or the managing underwriters may request at least two business days
prior to any sale of Restricted Stock; and

(l)            permit any holder of Restricted Stock which holder, in
the sole and exclusive judgment, exercised in good faith, of such holder, might
be deemed to be a controlling person of the Company, to participate in good
faith in the preparation of such registration or comparable statement and to
require the insertion therein of material, furnished to the Company in writing,
which in the reasonable judgment of such holder and its counsel should be
included, subject to review by the Company and its counsel after consultation
with such holder.

For
purposes of Sections 2.7(a) and 2.7(b) and of Section 2.4(c), the period of
distribution of Restricted Stock in a firm commitment underwritten public
offering shall be deemed to extend until each underwriter has completed the
distribution of all securities purchased by it, and the period of distribution
of Restricted Stock in any other registration shall be deemed to extend until
the earlier of the sale of all Restricted Stock covered thereby and 120 days
after the effective date thereof.

In
connection with each registration hereunder, the sellers of Restricted Stock
will furnish to the Company in writing such information with respect to
themselves and the proposed distribution by them as reasonably shall be
necessary in order to assure compliance with federal and applicable state
securities laws.

In
connection with each registration pursuant to Sections 2.3, 2.4, 2.5, 2.6 or
2.14 covering an underwritten public offering, the Company and each seller of
securities in such offering agree to enter into a written agreement with the
managing underwriter selected in the manner herein provided in such form and
containing such provisions as are customary in the securities business for such
an arrangement between such underwriter and companies of the Company’s size and
investment stature.

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2.8           Expenses. 
All expenses incurred by the Company in complying with Sections 2.3,
2.4, 2.5, 2.6 and 2.14, including, without limitation, all registration and
filing fees, printing expenses, fees and disbursements of counsel and
independent public accountants for the Company, fees and expenses (including
counsel fees) incurred in connection with complying with state securities or “blue
sky” laws, fees of the National Association of Securities Dealers, Inc.,
transfer taxes, fees of transfer agents and registrars, costs of insurance, and
fees and disbursements of one special counsel for the sellers of Restricted
Stock, but excluding any Selling Expenses, are called “Registration Expenses.”  All underwriting discounts and selling
commissions applicable to the sale of Restricted Stock are called “Selling
Expenses.”

The
Company will pay all Registration Expenses in connection with each registration
statement under Sections 2.3, 2.4, 2.5, 2.6 or 2.14; provided, however,
that if a registration statement is withdrawn at the request of the
participating holders of Restricted Stock (other than as a result of a Material
Adverse Change), such Registration Expenses shall be borne by the participating
holders of Restricted Stock who made such withdrawal requests in proportion to
the number of shares of Restricted Stock proposed to be sold by each.  All Selling Expenses in connection with each
registration statement under Sections 2.3, 2.4, 2.5, 2.6 or 2.14 shall be borne
by the participating sellers in proportion to the number of shares sold by
each, or by such participating sellers other than the Company (except to the
extent the Company shall be a seller) as they may agree.

2.9           Indemnification and Contribution.

(a)           In the event of a registration of any of the Restricted
Stock under the Securities Act pursuant to Sections 2.3, 2.4, 2.5, 2.6 or 2.14,
the Company will indemnify and hold harmless each seller of such Restricted
Stock thereunder, each underwriter of such Restricted Stock thereunder and each
other person, if any, who controls such seller or underwriter within the
meaning of the Securities Act, against any losses, claims, damages or
liabilities, joint or several, to which such seller, underwriter or controlling
person may become subject under the Securities Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in any registration statement under which such
Restricted Stock was registered under the Securities Act pursuant to
Sections  2.3, 2.4, 2.5, 2.6 or 2.14, any
preliminary prospectus or final prospectus contained therein, or any amendment
or supplement thereof, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and will reimburse
each such seller, each such underwriter and each such controlling person for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action; provided,
however, that the Company will not be liable in any such case if and to
the extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission so made in conformity with information furnished by any such
seller, any such underwriter or any such controlling person in writing
specifically for use in such registration statement or prospectus.

(b)           In the event of a registration of any of the Restricted
Stock under the Securities Act pursuant to Sections 2.3, 2.4, 2.5, 2.6 or 2.14,
each seller of such Restricted Stock 

 

10

 

thereunder, severally and not jointly, will
indemnify and hold harmless the Company, each person, if any, who controls the
Company within the meaning of the Securities Act, each officer of the Company
who signs the registration statement, each director of the Company, each
underwriter and each person who controls any underwriter within the meaning of
the Securities Act, against all losses, claims, damages or liabilities, joint
or several, to which the Company or such officer, director, underwriter or
controlling person may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in the registration statement under which such
Restricted Stock was registered under the Securities Act pursuant to Sections  2.3, 2.4, 2.5, 2.6 or 2.14, any preliminary
prospectus or final prospectus contained therein, or any amendment or
supplement thereof, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will reimburse the
Company and each such officer, director, underwriter and controlling person for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action; provided,
however, that such seller will be liable hereunder in any such case if
and only to the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in reliance upon and in conformity with
information pertaining to such seller, as such, furnished in writing to the
Company by such seller specifically for use in such registration statement or
prospectus; and, provided, further, however, that the
liability of each seller hereunder shall be limited to the proportion of any
such loss, claim, damage, liability or expense which is equal to the proportion
that the public offering price of the shares sold by such seller under such
registration statement bears to the total public offering price of all
securities sold thereunder, but not in any event to exceed the net proceeds
received by such seller from the sale of Restricted Stock covered by such
registration statement.

(c)           Promptly after receipt by an indemnified party hereunder
of notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party
hereunder, notify the indemnifying party in writing thereof, but the omission
so to notify the indemnifying party shall not relieve it from any liability
which it may have to such indemnified party other than under this Section 2.9
and shall only relieve it from any liability which it may have to such
indemnified party under this Section 2.9 if and to the extent the indemnifying
party is prejudiced by such omission.  In
case any such action shall be brought against any indemnified party and it
shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate in and, to the extent it
shall wish, to assume and undertake the defense thereof with counsel reasonably
satisfactory to such indemnified party, and, after notice from the indemnifying
party to such indemnified party of its election so to assume and undertake the
defense thereof, the indemnifying party shall not be liable to such indemnified
party under this Section 2.9 for any legal expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation and of liaison with counsel so selected; provided,
however, that, if the defendants in any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be reasonable defenses available to it
which are different from or additional to those available to the indemnifying
party or if the interests of the indemnified party reasonably may be 

 

11

 

deemed to conflict with the interests of the
indemnifying party, the indemnified party shall have the right to select a
separate counsel and to assume such legal defenses and otherwise to participate
in the defense of such action, with the expenses and fees of such separate
counsel and other expenses related to such participation to be reimbursed by
the indemnifying party as incurred.

(d)           In order to provide for just and equitable contribution to
joint liability under the Securities Act in any case in which either (i) any
holder of Restricted Stock exercising rights under this Agreement, or any
controlling person of any such holder, makes a claim for indemnification
pursuant to this Section 2.9 but it is judicially determined (by the entry of a
final judgment or decree by a court of competent jurisdiction and the
expiration of time to appeal or the denial of the last right of appeal) that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 2.9 provides for indemnification in such case, or (ii)
contribution under the Securities Act may be required on the part of any such
selling holder or any such controlling person in circumstances for which indemnification
is provided under this Section 2.9; then, and in each such case, the Company
and such holder will contribute to the aggregate losses, claims, damages or
liabilities to which they may be subject (after contribution from others) in
such proportion so that such holder is responsible for the portion represented
by the percentage that the public offering price of its Restricted Stock
offered by the registration statement bears to the public offering price of all
securities offered by such registration statement, and the Company is
responsible for the remaining portion; provided, however, that,
in any such case, (A) no such holder will be required to contribute any amount
in excess of the public offering price of all such Restricted Stock offered by
it pursuant to such registration statement; and (B) no person or entity guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) will be entitled to contribution from any person or entity who
was not guilty of such fraudulent misrepresentation.

2.10         Changes in Common Stock or Preferred
Stock.  If, and as often as, there is
any change in the Common Stock or the Preferred Stock by way of a stock split,
stock dividend, combination or reclassification, or through a merger,
consolidation, reorganization or recapitalization, or by any other means,
appropriate adjustment shall be made in the provisions hereof so that the
rights and privileges granted hereby shall continue with respect to the Common
Stock and the Preferred Stock as so changed.

2.11         Rule 144 Reporting. 
With a view to making available the benefits of certain rules and
regulations of the Commission which may at any time permit the sale of the
Restricted Stock to the public without registration, at all times after 90 days
after any registration statement covering a public offering of securities of
the Company under the Securities Act shall have become effective, the Company
agrees to:

(a)           make and keep public information available, as those terms
are understood and defined
in Rule 144 under the Securities Act;

(b)           use its best efforts to file with the
Commission in a timely manner all reports and other documents required of the
Company under the Securities Act and the Exchange Act; and

 

12

 

(c)           furnish to each holder of Restricted Stock forthwith upon
request a written statement by the Company as to its compliance with the
reporting requirements of such Rule 144 and of the Securities Act and the
Exchange Act, a copy of the most recent annual or quarterly report of the
Company, and such other reports and documents so filed by the Company as such
holder may reasonably request in availing itself of any rule or regulation of
the Commission allowing such holder to sell any Restricted Stock without registration.

2.12         Suspension of Registration Rights.  Notwithstanding the provisions of Section
2.4, the Company’s obligation to file a registration statement, or cause such
registration statement to become and remain effective, shall be suspended for a
period not to exceed 120 days (in the case of a registration statement on Form
S-1) or 90 days (in the case of a registration statement on Form S-3) in any
12-month period if the Company shall furnish to the Investors requesting such
registration a certificate signed by the President of the Company stating
either (i) that in the good faith judgment of the Company it would likely be
detrimental to the Company or its stockholders (whether due to a potential
adverse effect on a pending transaction or otherwise) for a registration
statement to be filed in the near future or (ii) that there exists at the time
material non-public information relating to the Company which, in the
reasonable opinion of the Company, should not be disclosed.

2.13         No More Favorable “Piggy-Back” Registration Rights.  The Company shall not grant to any third
party any “piggy-back” registration rights of the type set forth in Section 2.5
that are more favorable than or inconsistent with any of those contained
herein, so long as any of the registration rights under this Agreement remains
in effect without the prior written consent of at least sixty-six and
two-thirds percent (66 2/3%) in interest of the Preferred Stock held by Major
Investors.

2.14         Second Public Offering.

(a)           If the Company at any time proposes its Second Public
Offering, it will give written notice to all holders of outstanding Restricted
Stock of its intention so to do.  Upon
the written request of any such holder, received by the Company within 15 days
after the giving of any such notice by the Company, to register any of its
Restricted Stock, the Company will use, subject to the thresholds specified in
Section 2.14(b) and (c) below, its best efforts to cause the Restricted Stock
as to which registration shall have been so requested to be included in the
securities to be covered by the registration statement proposed to be filed by
the Company (the “Second Public Offering Registration Statement”), all to the
extent requisite to permit the sale or other disposition by the holder of such
Restricted Stock so registered; subject to the terms set forth in this Section
2.14.

(b)           The Second Public Offering Registration Statement shall
cover no less than (i) 800,000 shares to be issued by the Company, (ii)
2,100,000 shares to be sold by the holders of Restricted Stock, (iii) 600,000
shares to be sold by the Specified Officers (or such lesser amount as is
specified by the Company, after consultation with the lead underwriter in the
underwritten offering pursuant to such registration statement), (iv) 500,000
shares to be sold by other stockholders specified by the Company (or such
lesser amount as is specified by the Company, after consultation with such lead
underwriter) and (v) an amount equal to 15% of the sum of the number of shares
to be included in the Second Public Offering Registration Statement 

 

13

 

 

pursuant to clauses (i) through (iv) of this Section
2.14(b), which amount shall constitute Overallotment Shares.

(c)           The number of shares of Restricted Stock to be included
for sale in an underwritten offering made pursuant to the prospectus included
in the Second Public Offering Registration Statement may be reduced (pro rata
among the requesting holders based upon the number of shares of Restricted
Stock owned by such holders) to a minimum of 2,100,000 shares to the extent the
Company specifies, after consultation with the lead underwriter in such
offering.  To the extent that more than
4,000,000 shares are proposed to be offered for sale pursuant to such
prospectus (without giving effect to any exercise of the underwriters’
overallotment option), the shares proposed to be offered for sale in excess of
4,000,000 shall be allocated for sale by the holders of Restricted Stock who
requested to have shares of Restricted Stock included in the Registration
Statement pursuant hereto (pro rata among the requesting holders based upon the
number of shares of Restricted Stock owned by such holders).

(d)           The Registration Statement shall also register shares to
be offered to the underwriters pursuant to an overallotment option to be
granted to the underwriters (the “Overallotment Shares”).  The shares specified in Section 2.14(c) shall
be deemed not to include the Overallotment Shares.  Up to 200,000 shares of common stock may be
offered by the Company to the underwriters of the offering made pursuant to the
Second Public Offering Registration Statement to cover the first portion any
request by such underwriters for Overallotment Shares.  Any additional Overallotment Shares shall be
allocated for sale to such underwriters by the holders of Restricted Stock (pro
rata among the requesting holders based upon the number of shares of Restricted
Stock owned by such holders).

(e)           If the Company at any time proposes its Second Public
Offering, it will give notice to the Specified Officers of its intention to do
so.  Upon the written request of any
Specified Officer to register any of Common Stock held by such Specified
Officer, the Company will use its best efforts to cause the Common Stock as to
which registration shall have been so requested to be included in the
securities to be covered by the registration statement proposed to be filed by
the Company, up to amounts the Company specifies, after consultation with the
lead underwriter in the underwritten offering pursuant to the Second Public
Offering Registration Statement, in each case, subject to the terms of this
Section 2.14.

ARTICLE III

[INTENTIONALLY OMITTED]

ARTICLE IV

[INTENTIONALLY OMITTED]

ARTICLE V

[INTENTIONALLY OMITTED]

ARTICLE VI

MISCELLANEOUS

6.1           Binding Effect. 
All covenants and agreements contained in this Agreement by or on behalf
of any of the parties hereto shall bind and inure to the benefit of the
respective 

 

14

 

 

successors and assigns of the parties hereto
(including without limitation transferees of any Preferred Shares or Restricted
Stock), whether so expressed or not; provided, however, that registration
rights conferred herein on the holders of Preferred Shares, Conversion Shares
or Restricted Stock shall only inure to the benefit of a transferee of
Preferred Shares, Conversion Shares or Restricted Stock if the Company is given
written notice thereof and either: (i) there is transferred to such transferee
all of the shares (but in any event at least 100,000 shares) of Restricted
Stock originally issued pursuant to the Purchase Agreement to the direct or
indirect transferor of such transferee or (ii) such transferee is a limited or
general partner, stockholder, member, unitholder or affiliate of a party hereto
or any beneficial owner of any interest in a party hereto and such transferee
agrees in writing the Company to take action under this Agreement through a
single representative.

6.2           Notices.  All
notices, requests, consents and other communications hereunder shall be in
writing and shall be delivered in person, mailed by certified or registered
mail, return receipt requested or via overnight courier, or sent by telecopier
or telex, addressed as follows:

if
to the Company or any other party hereto, at the address of such party set
forth in the Purchase Agreement;

if
to any subsequent holder of Preferred Shares, Conversion Shares or Restricted
Stock, to it at such address as may have been furnished to the Company in
writing by such holder;

or,
in any case, at such other address or addresses as shall have been furnished in
writing to the Company (in the case of a holder of Preferred Shares, Conversion
Shares or Restricted Stock) or to the holders of Preferred Shares, Conversion
Shares or Restricted Stock (in the case of the Company) in accordance with the
provisions of this paragraph.

6.3           Governing Law. 
This Agreement shall be governed by and construed in accordance with the
General Corporation Law of the State of Delaware as to matters within the scope
thereof, and as to all other matters shall be governed by and construed in
accordance with the internal laws of the Commonwealth of Massachusetts, without
regard to its principles of conflicts of laws.

6.4           Amendment and Waiver.  Except as otherwise expressly set forth
herein, this Agreement may not be amended or modified, and no provision hereof
may be waived, without the written consent of the Company and the holders of at
least sixty-six and two-thirds percent (66 2/3%) in interest of the Restricted
Stock held by the Major Investors. 
Additionally, Sections 2.7, 2.8 or 2.9 may not be amended, modified or
waived without the written consent of at least two-thirds of the Specified
Officers and Section 2.14 may not be amended, modified or waived without the
written consent of at least two-thirds of the Specified Officers.

6.5           Counterparts; Facsimile Signatures.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.  This Agreement may be executed by facsimile
signatures.

6.6           Termination of Registration Rights.  The obligations of the Company to register 

 

15

 

shares of Restricted Stock under Sections 2.4, 2.5,
2.6 or 2.14 shall terminate on the later of (1) fifth anniversary of the date
of the Initial Public Offering; or (ii) the date all holders of Restricted
Stock can sell all of their Restricted Stock within a three month period
pursuant to Rule 144 under the Securities Act.

6.7           Lock-Up. 
Each holder of Restricted Stock agrees not to (i) offer to sell, pledge,
sell, contract to sell, sell any option or contract to purchase, purchase any
option or contract to sell, grant any option, right or warrant for the sale of,
or otherwise dispose of or transfer any interest in shares of Restricted Stock
or other shares of Common Stock or any securities convertible into or
exchangeable or exercisable for Common Stock (including, without limitation any
shares of Common Stock that such holder then holds or thereafter acquires the
power of disposition over) or (ii) enter into any swap or any other agreement
or any transaction that transfers, in whole or in part, directly or indirectly,
the economic consequence of ownership of the Restricted Stock, whether any such
swap transaction is to be settled by delivery of the Restricted Stock or other
securities, in cash or otherwise, whether in privately negotiated or open
market transactions, without the consent of the managing underwriters during
the 180-day period following the effective date of a registration statement
filed in connection with the Company’s Initial Public Offering under the
Securities Act, and to enter into a separate written agreement with the
managing underwriters of such registration to such effect in form and substance
satisfactory to the Company and such underwriters; provided, that each executive officer, director and
beneficial or record holder of at least two percent (2%) of the outstanding
equity securities of the Company are also required to execute such an
agreement.  The Company may impose
stop-transfer instructions with respect to the shares subject to the foregoing
restrictions until the end of said 180-day period.

6.8           Severability. 
If any provision of this Agreement shall be held to be illegal, invalid
or unenforceable, such illegality, invalidity or unenforceability shall attach
only to such provision and shall not in any manner affect or render illegal,
invalid or unenforceable any other provision of this Agreement, and this
Agreement shall be carried out as if any such illegal, invalid or unenforceable
provision were not contained herein.

6.9           Section Headings; Pronouns.  The headings contained in this Agreement are
for reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement. 
Whenever the context may require, any pronouns used in this Agreement
shall include the corresponding masculine, feminine or neuter forms and the
singular forms of nouns and pronouns shall include the plural, and vice versa.

6.10         Confidentiality. 
Each Investor agrees that he, she or it will keep confidential and will
not disclose, divulge or use for any purpose other than to monitor his, her or
its investment in the Company any confidential, proprietary or secret
information which such Investor may obtain from the Company pursuant to
financial statements, reports and other materials submitted by the Company to
such Investor pursuant to this Agreement, or pursuant to visitation or
inspection rights granted hereunder (“Confidential Information”), unless
such Confidential Information is known, or until such Confidential Information
becomes known, to the public (other than as a result of a breach of this
Section 6.10 by such Investor); provided, however, that an Investor may
disclose Confidential Information (i) to its attorneys, accountants,
consultants, and other professionals to the extent necessary to obtain their
services in connection with 

 

16

 

monitoring its investment in the Company, (ii) to
any prospective purchaser of any Shares from such Investor as long as such
prospective purchaser agrees in writing to be bound by the provisions of this
Section 6.10, (iii) to any affiliate of such Investor or to a partner,
stockholder, employee or subsidiary of such Investor, provided that such
affiliate agrees in writing to be bounds by the provisions of this Section 6.10,
or (iv) as may otherwise be required by law, provided that the Investor takes
reasonable steps to minimize the extent of any such required disclosure; and,
provided, further, however, that Confidential Information shall not include
information related to the tax treatment or tax structure of the transactions
contemplated herein.  For this purpose, “tax
structure” is limited to any facts relevant to the U.S. federal income tax
treatment of the transaction and does not include information relating to the
identity of the parties.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

17

IN
WITNESS WHEREOF, the parties hereto have caused this Fifth Amended and Restated
Investor Rights Agreement to be executed as an instrument under seal of the
date first above written.

ENERNOC, INC.

	
   

  	
  By:

  	
  /s/ Timothy Healy

  
	
   

  	
  Name: 

  	
  Timothy Healy

  
	
   

  	
  Title:

  	
  Chief Executive Officer

  

 

INVESTORS:

FOUNDATION CAPITAL IV, L.P.

By Foundation Capital Management Co. IV, LLC

	
   

  	
  By:

  	
  /s/ Adam Grosser

  
	
   

  	
  Name:

  	
  Adam Grosser

  
	
   

  	
  Title:

  	
  Manager

  

 

FOUNDATION CAPITAL IV
PRINCIPALS FUND, LLC

By Foundation Capital Management Co. IV, LLC

	
   

  	
  By:

  	
  /s/ Adam Grosser

  
	
   

  	
  Name:

  	
  Adam Grosser

  
	
   

  	
  Title:

  	
  Manager

  

 

FC IV ACTIVE ADVISORS, LLC

By Foundation Capital Management Co. IV, LLC

	
   

  	
  By:

  	
  /s/ Adam Grosser

  
	
   

  	
  Name:

  	
  Adam Grosser

  
	
   

  	
  Title:

  	
  Manager

  

 

DRAPER FISHER JURVETSON NEW ENGLAND FUND I
(SBIC), L.P.

	
   

  	
  By:

  	
  /s/ Scott M. Johnson

  
	
   

  	
  Name:

  	
  Scott M. Johnson

  
	
   

  	
  Title:

  	
  Manager and Member of
  General Partner

  

 

DRAPER FISHER JURVETSON FUND VI, L.P.

	
   

  	
  By:

  	
  /s/ John Fisher

  
	
   

  	
  Name: 

  	
  John Fisher

  
	
   

  	
  Title:

  	
  Managing Director

  

 

DRAPER FISHER JURVETSON PARTNERS VI, LLC

	
   

  	
  By:

  	
  /s/ John Fisher

  
	
   

  	
  Name:

  	
  John Fisher

  
	
   

  	
  Title:

  	
  Managing Member

  

 

DRAPER ASSOCIATES, L.P.

	
   

  	
  By:

  	
  /s/ Timothy C. Draper

  
	
   

  	
  Name:

  	
  Timothy C. Draper

  
	
   

  	
  Title:

  	
  General Partner

  

 

BRAEMAR ENERGY VENTURES, LP

	
   

  	
  By:

  	
  /s/ William D. Lese

  
	
   

  	
  Name:

  	
  William D. Lese

  
	
   

  	
  Title:

  	
  Managing Director

  

 

	
   

  	
   

  
	
   

  	
  William Hart

  

 

	
   

  	
   

  
	
   

  	
  Philip Giudice

  

 

	
   

  	
   

  
	
   

  	
  Michael Horvath

  

 

 

 

FOUNDERS:

 

 

	
   

  	
  /s/ Timothy G. Healy

  
	
   

  	
  Timothy G. Healy

  

 

	
   

  	
  /s/ David B. Brewster

  
	
   

  	
  David B. Brewster

  

 

 

 

 

SCHEDULE I

ENERNOC, INC.

INSTRUMENT OF ACCESSION

The
undersigned,                                  ,
hereby agrees to become party to and bound by that certain Fifth Amended and
Restated Investor Rights Agreement dated as of 
November   , 2007 by and among
EnerNOC, Inc., a Delaware corporation (the “Company”) and certain stockholders
of the Company.  This Instrument of
Accession shall take effect and shall become an integral part of the said
Investor Rights Agreement immediately upon execution and delivery to the
Company of this Instrument.

IN
WITNESS WHEREOF, this INSTRUMENT OF ACCESSION has been duly executed by or on
behalf of the undersigned, as a sealed instrument under the laws of the
Commonwealth of Massachusetts, as of the date below written.

Signature:

 

	
   

  	
   

  
	
   

  	
  (Print Name)

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
  Date:

  	
   

  
					

 

Accepted:

ENERNOC, INC.

	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
  Date:

  	
   

  
							

 

4180214v.1Exhibit
10(a)

 

September
7, 2007

 

Brinker
International, Inc.

6820
LBJ Freeway

Dallas,
Texas 75240

 

	
  Attn:

  	
  Marie
  Perry, Treasurer

  
	
   

  	
   

  
	
   

  	
  Re:

  	
  Amended
  Uncommitted Line of Credit

  

 

Ladies
and Gentlemen:

 

We
are pleased to advise you that BANK OF AMERICA, N.A. (the “Lender”) has
established for Brinker International, Inc., a Delaware corporation (the “Borrower”),
an amended uncommitted line of credit with aggregate advances (“Loans”)
outstanding thereunder not at any time to exceed $100,000,000, replacing that
certain uncommitted line of credit dated August 10, 2007 between the Lender and
the Borrower. The terms and conditions of the amended line of credit are as
follows:

 

	
  Loans Discretionary:

  	
  All
  Loans under this line of credit shall be at the sole discretion of the
  Lender. This letter is not a commitment by the Lender to extend credit.
  Without limiting the generality of the foregoing, no Loan shall be made after
  the Expiration Date.

  
	
   

  	
   

  
	
  Principal:

  	
  The
  outstanding principal of each Loan shall be due and payable on the earlier of
  (a) the maturity date for such Loan agreed to by the Lender and the Borrower
  at time such Loan is made, and (b) the Maturity Date.

  
	
   

  	
   

  
	
  Interest:

  	
  Each
  Loan shall bear interest at the rate of LIBOR plus 0.23% at the time such
  Loan is made. Accrued and unpaid interest on each Loan shall be due and
  payable on the date that such Loan is payable. If the term of a Loan is more
  than 90 days (or, if expressed in months, three months), interest on such
  Loan shall also be payable on the 90th day or last day of the
  third month after the making of such Loan and on each 90th day or
  last day of each third month thereafter, as applicable.

  
	
   

  	
   

  
	
  Expiration Date:

  	
  September
  5, 2008.

  
	
   

  	
   

  
	
  Maturity Date:

  	
  September
  5, 2008.

  

 

 

	
  Requests for Loans:

  	
  Any
  request for a Loan must be received by the Lender at the address, telephone
  number or facsimile number listed below the Lender’s signature not later than
  11:00 a.m., EST time, on the date of the requested Loan (which must be a day
  on which the Lender is open to conduct substantially all of its business).

  
	
   

  	
   

  
	
  Documentation:

  	
  The
  Loans shall be evidenced by a promissory note satisfactory in form and
  substance to the Lender executed by the Borrower. The Borrower shall execute
  and deliver to the Lender such other documents as the Lender may reasonably
  request from time to time.

  
	
   

  	
   

  
	
  Notice:

  	
  The
  Lender hereby notifies the Borrower that pursuant to the requirements of the
  USA Patriot Act (Title III of Pub.L. 107-56 (signed into law October 26,
  2001)) (the “Act”), the Lender is required to obtain, verify and record
  information that identifies the Borrower, which information includes the name
  and address of the Borrower and other information that will allow the Lender
  to identify the Borrower in accordance with the Act.

  

 

Please
indicate your acknowledgment of the foregoing by signing and returning to the
Lender the enclosed copy of this letter at the address shown on the first page
hereof.

 

	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
  BANK
  OF AMERICA, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/
  John H. Schmidt

  	
   

  
	
   

  	
  Name:

  	
    John
  H. Schmidt

  	
   

  
	
   

  	
  Title:

  	
       Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  	
    100
  Federal Street

  
	
   

  	
  Mail Stop:

  	
    MA5-100-09-06
  Boston, MA 02110

  
	
   

  	
  Telephone:

  	
    (617)
  434-4044

  
	
   

  	
  Facsimile:

  	
      (617)
  434-0637

  
	
  Acknowledged:

  	
   

  
	
   

  	
   

  
	
  BORROWER

  	
   

  
	
   

  	
   

  
	
  By:

  	
    /s/
  Marie Perry

  	
   

  	
   

  
	
  Name:

  	
    Marie
  Perry

  	
   

  	
   

  
	
  Title:

  	
     
  Vice President and Treasurer

  	
   

  	
   

  
													

 

2

 

MASTER PROMISSORY NOTE

 

	
  $100,000,000

  	
   

  	
  September 7, 2007

  

 

FOR
VALUE RECEIVED, the undersigned, Brinker International, Inc., a Delaware
corporation (the “Borrower”), hereby promises to pay to the order of
BANK OF AMERICA, N.A. (the “Lender”), at its office at 6820 LBJ Freeway,
Dallas, Texas 75240 (or at such other place as the Lender may designate from
time to time), in lawful money of the United States of America and in
immediately available funds, the principal amount of one hundred million
Dollars ($100,000,000) or such lesser amount as shall equal the aggregate
unpaid principal amount of the advances (the “Loans”) made by the Lender
to the Borrower under this Master Promissory Note (the “Note”), and to
pay interest on the unpaid principal amount of each such Loan at the rates per
annum and on the dates specified below.

 

Each
Loan hereunder shall be at the sole discretion of the Lender. Each Loan shall
have a maturity date and shall bear interest at the rate per annum quoted to
the Borrower by the Lender and accepted by the Borrower prior to the making of
such Loan (which acceptance shall in any event be deemed to occur upon receipt
by the Borrower of the proceeds of any Loan). Each Loan, and accrued and unpaid
interest thereon, shall be due and payable, on the earlier of (a) the maturity
date of such Loan, or (b) September 5, 2008. No Loan shall have a maturity of
more than 180 days (6 months). If the term of a Loan is more than 90 days
(three months), interest on such Loan shall also be payable on the last day of
the third month after the making of such Loan and on each last day of each
third month thereafter. The Lender may, if and to the extent any payment is not
made when due hereunder, charge from time to time against any or all of the
Borrower’s accounts with the Lender any amount so due.

 

The
date, amount, interest rate, and maturity date of each Loan, and each payment
of principal and interest hereon, shall be recorded by the Lender on its books,
which recordations shall, in the absence of manifest error, be conclusive as to
such matters; provided, that the failure of the Lender to make any such
recordation or any error therein shall not limit or otherwise affect the
obligations of the Borrower hereunder.

 

The
Borrower may not prepay any Loan in whole or in part without the Lender’s prior
written consent; provided, however, that if any such prepayment
is made the Borrower shall, at the time of prepayment, compensate the Lender
for any loss, cost, or expense that the Lender incurs as a result of such
prepayment. In addition, the Borrower shall compensate the Lender for any loss,
cost or expense that the Lender incurs as a result of a prepayment by reason of
acceleration of the indebtedness hereunder.

 

Interest
shall be computed on the basis of a year of 360 days and the actual days
elapsed (including the first day but excluding the last day). Overdue principal
and, to the extent permitted by applicable law, interest shall bear interest,
payable upon demand, for each day from and including the due date to but
excluding the date of actual payment at a rate per annum equal to the sum of 2%
plus the rate of interest publicly announced by the Lender from time to time as
its prime rate. The Lender’s prime rate is a rate set by the Lender based upon
various factors including the Lender’s cost and desired return, general
economic conditions and other factors, and is used as a reference point for
pricing some loans, which may be priced at, above, or below such announced rate.
Whenever any payment under this Note is due on a day that is not a day the
Lender is open to conduct substantially all of its business, such payment shall
be made on the next succeeding day on which the Lender is open to conduct
substantially all of its business, and such extension of time shall in such
case be included in the computation of the payment of interest.

 

Each
of the following shall constitute an Event of Default hereunder:  (a) the Borrower shall fail to pay when due
any principal of or interest on any Loan; (b) a default or event of default
shall occur

 

1

 

under
the terms of any other indebtedness for which the Borrower or any of its
subsidiaries is liable, whether as principal obligor, guarantor, or otherwise
having an aggregate principal amount (including undrawn committed or available
amounts and including amounts owing to all credits under any combined or
syndicated credit arrangement) in excess of $100,000; (c) the long term, senior
unsecured debt rating of the Borrower shall be lower than (i) BBB- from
Standard & Poor’s Ratings Group or (ii) Baa3 from Moody’s Investors
Service, Inc., (d) any representation, warranty, certification, or statement
made or deemed made by the Borrower to the Lender shall prove to have been
incorrect or misleading in any material respect; (e) the Borrower shall
dissolve, liquidate, or terminate its legal existence or shall convey,
transfer, lease, or dispose of (whether in one transaction or a series of
transactions) all or substantially all of its assets to any person or entity; (f)
a petition shall be filed by or against the Borrower or any of its subsidiaries
under any law relating to bankruptcy, reorganization, or insolvency; or (g) the
Borrower or any of its subsidiaries shall make an assignment for the benefit of
creditors or fail generally to pay its debts as they become due, or a receiver,
trustee, or similar official shall be appointed over the Borrower or any of its
subsidiaries or a substantial portion of any of their respective assets. If an
Event of Default shall have occurred and be continuing, the Lender may declare
the outstanding principal of and accrued and unpaid interest on this Note,
together with all other amounts payable hereunder, to be immediately due and
payable without presentment, protest, demand, or other notice of any kind, all
of which are hereby waived by the Borrower; provided, however,
that upon the occurrence with respect to the Borrower of any event specified in
clause (f) of the preceding sentence, the outstanding principal and accrued and
unpaid interest on this Note, together with all other amounts payable
hereunder, shall become immediately due and payable without presentment,
protest, demand, or other notice of any kind, all of which are hereby waived by
the Borrower.

 

The
request of the Borrower for any Loan and the receipt by the Borrower of the
proceeds thereof shall be deemed a representation by the Borrower as of the
date of each such request or receipt that no Event of Default has occurred and
that the Borrower is duly authorized to incur such indebtedness hereunder.

 

No
failure or delay by the Lender in exercising, and no course of dealing with
respect to, any right, power, or privilege hereunder shall operate as a waiver
thereof nor shall any single or partial exercise of any other right, power, or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, power, or privilege. The rights and remedies of
the Lender provided herein shall be cumulative and not exclusive of any other
rights or remedies provided by law. If any provision of this Note shall be held
invalid or unenforceable in whole or in part, such invalidity or
unenforceability shall not affect the remaining provisions hereof. No provision
of this Note may be modified or waived except by a written instrument signed by
the Lender and the Borrower.

 

The
Lender shall incur no liability to the Borrower in acting upon any telephone,
telex, or other communication that the Lender in good faith believes has been
given by an authorized representative of the Borrower.

 

The
Lender may assign to one or more banks or other entities all or any part of, or
may grant participations to one or more banks or other entities in or to all or
any part of, this Note or any Loan or Loans hereunder.

 

The
Borrower shall pay on demand all costs and expenses (including reasonable
attorney’s fees and the allocated costs of internal counsel) incurred by the
Lender in connection with any Event of Default or the enforcement or attempted
enforcement of this Note.

 

Notwithstanding
anything to the contrary contained herein, the interest paid or agreed to be
paid hereunder shall not exceed the maximum rate of non-usurious interest
permitted by applicable law (the

 

2

 

“Maximum
Rate”). If the Lender shall receive interest in an amount that exceeds the
Maximum Rate, the excessive interest shall be applied to the principal of this
Note or, if it exceeds the unpaid principal, refunded to the Borrower. In
determining whether the interest contracted for, charged, or received by the
Lender exceeds the Maximum Rate, the Lender may, to the extent permitted by
applicable law, (a) characterize any payment that is not principal as an
expense, fee, or premium rather than interest, (b) exclude voluntary
prepayments and the effects thereof, and (c) amortize, prorate, allocate, and
spread in equal or unequal parts the total amount of interest throughout the
stated term of this Note.

 

This
Note shall be governed by and construed in accordance with the laws of the
State of Texas. The Borrower hereby submits to the nonexclusive jurisdiction of
the United States District Court and each state court in the City of Dallas for
the purposes of all legal proceedings arising out of or relating to this Note. The
Borrower irrevocably waives, to the fullest extent permitted by law, any
objection that it may now or hereafter have to the laying of venue of any such
proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum. The Borrower and the Lender by acceptance of this Note hereby
irrevocably waive any and all right to trial by jury in any legal proceeding
arising out of or relating to this Note.

 

THIS
NOTE AND ANY OTHER DOCUMENTS EXECUTED IN CONNECTION HEREWITH REPRESENT THE
FINAL AGREEMENT BETWEEN THE PARTEIS AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE
NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/
  Marie Perry

  	
   

  
	
   

  	
  Name:

  	
    Marie
  Perry

  	
   

  
	
   

  	
  Title:

  	
   
    Vice President and Treasurer

  	
   

  
						

 

3

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