Document:

blue_ex10-04.htm

Exhibit 10.4

LOCK-UP AGREEMENT

 

LOCK-UP AGREEMENT (the “Lock-Up Agreement”) dated as of May 16, 2011 (the “Closing Date”), by and between SwitchGenie, LLC (the “Seller”) and Blue Earth, Inc. (the “Buyer”), a Nevada corporation.

 

W I T N E S S E T H:

 

WHEREAS, Blue Earth Management, Inc., a wholly-owned subsidiary of Buyer, has agreed to License from James Loughrey and SwitchGenie LLC certain patents and other intellectual property pursuant to the terms and conditions of an Exclusive License and Manufacturing Agreement dated the date hereof (the “License”).

 

WHEREAS, pursuant to Section 4(a)(i) of the License, Buyer will issue to the Seller One Hundred Fifty Thousand (150,000) restricted shares of the Common Stock of Buyer (the “Buyer Shares”); and

 

WHEREAS, pursuant to Section 6 of the Letter of Intent dated May 2, 2011, the Seller has agreed not to sell, transfer or otherwise dispose of the Buyer Shares, except as set forth in this Lock-Up Agreement.

 

NOW, THEREFORE, in consideration of the foregoing and the terms, conditions and mutual covenants appearing in this Lock-Up Agreement, the parties hereto hereby agree as follows:

 

Section 1.

 

(a)           The resale of the Buyer Shares shall be according to the following schedule:  Beginning on the Closing of the License (the “Closing Date”) and for twelve (12) months thereafter, Seller may not sell any Buyer Shares.  Thereafter, pursuant to the terms and conditions of Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”), Seller may sell up to an aggregate of Three Thousand (3,000) Buyer Shares per  trading week, for the two-year period ending two years from the Closing Date (the “Lock-Up Period”) until all of the Buyer Shares have been sold.

 

(b)           All sales of Buyer Shares shall be by means of “in-the-market” transactions.  “In the market” shall mean a sale made on the OTC Bulletin Board, or any subsequent primary trading market, or customary trading channels in which the Buyer’s Common Stock is traded.

 

(c)           Buyer may permit and assist Seller in making additional sales of shares, if Seller so desires, when opportunities such as the following are available:

 

	
(i)

	
Block purchases by investors are requested.

(ii)           Shares of Seller may be included in a secondary offering registration statement which offers shares of the Buyer for sale to the public, provided

 

 

  

  

  

Investment Bankers and management of Buyer agree that such offerings would not be adverse to the funding opportunity for the Buyer.

 

(iii)                            When daily trading volumes/prices reasonably permit as determined by Buyer.

 

(d)           Any sales of Buyer Shares in violation of this Lock-Up Agreement by the Seller shall constitute an event of default under this Lock-Up Agreement and all net proceeds, derived from such event of default, shall be paid to Buyer.

 

(e)           The Seller further agrees that it will forward to Buyer all customary documentation reflecting any sale of Buyer Shares within fifteen (15) calendar days of the end of each month.

 

(f)           The Seller acknowledges that its breach or impending violation of any of the provisions of this Lock-Up Agreement may cause irreparable damage to the Buyer for which remedies at law would be inadequate.  The Seller further acknowledges that the provisions set forth herein are essential terms and conditions of the License and this Lock-Up Agreement.  The Seller therefore agrees that the Buyer shall be entitled to a decree or order by any court of competent jurisdiction enjoining such impending or actual violation of any of such provisions.  Such decree or order, to the extent appropriate, shall specifically enforce the full performance of any such provision by the Seller, and the Seller and Buyer hereby consent to the jurisdiction of any such court of competent jurisdiction, state or federal, sitting in the State of Nevada.  This remedy shall be in addition to all other remedies available to Buyer at law or equity.  If any portion of this section 1 is adjudicated to be invalid or unenforceable, this Section 1 shall be deemed amended to delete therefrom the portion so adjudicated, such deletion to apply only with respect to the operation of this Section 1 in the jurisdiction in which such adjudication is made.

 

(g)           Buyer Shares shall not at any time be used to cover “short” sales of the Buyer’s Common Stock.

 

Section 2.  If Buyer merges or consolidates with any other entity or if Buyer sells all or substantially all of its assets (a “Sale Transaction”), then, at Seller’s request and option, either Buyer will purchase remaining Buyer Shares held pursuant to this Agreement at the sale price of Buyer Shares per share in such Sale Transaction, or Seller will receive its Buyer Shares or any proceeds or stock to which it would be entitled as Buyer Stockholders.

 

Section 3.  Subject to Section 5 hereunder, this Lock-Up Agreement shall inure to the benefit of and be binding upon Buyer, its successors and assigns, and upon the Seller, its administrators, legatees and legal representatives.

 

Section 4.  Should any part of this Lock-Up Agreement, for any reason whatsoever, be declared invalid, illegal, or incapable of being enforced in whole or in part, such decision shall not affect the validity of any remaining portion, which remaining portion shall remain in full force and effect as if this Lock-Up Agreement had been executed with the invalid portion thereof eliminated, and it is hereby declared the intention of the parties hereto that it would have executed the remaining portion of this Lock-Up Agreement without including therein any portion which may for any reason be declared invalid.

 

Section 5.  This Lock-Up Agreement shall be construed and enforced in accordance with the laws of the State of Nevada applicable to agreements made and to be performed in such State without application of the principles of conflicts of laws of such State.

 

 

 

  

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Section 6.   This Lock-Up Agreement and all rights hereunder are personal to the parties and shall not be assignable, and any purported assignments in violation thereof shall be null and void.

 

(a)      All notices, requests, consents, and demands by the parties hereunder shall be delivered by hand, recognized national overnight courier or by deposit in the United States Mail, postage prepaid, by registered or certified mail, return receipt requested, addressed to the party to be notified at the address set forth below:

 

	
If to the Seller to:

	  
	  	
James Loughrey

	  	
4576 Echo Lane

	  	
Stacy, MN 55079

	  	
Telecopier No.:

	  	  
	
With a copy to:

	  
	  	  
	  	
Harold Slawok

	  	
New Council PLC

	  	
233 Park Avenue, Suite 203

	  	
Mpls, MN 55415

	  	  
	
If to Buyer to:

	  
	  	
Blue Earth, Inc.

	  	
2298 Horizon Ridge Parkway

	  	
Suite 205

	  	
Henderson, NV 89052

	  	
Attention:  Johnny R. Thomas, CEO

	  	
Telecopier No.:  702-263-1823

	  	  
	
With a copy to:

	  
	  	  
	  	
Davidoff Malito & Hutcher LLP

	  	
605 Third Avenue

	  	
New York, NY 10158

	  	
Attention:  Elliot H. Lutzker, Esq.

	  	
Telecopier No.: (212) 286-1884

(b)           Notices given by mail shall be deemed effective on the earlier of the date shown on the proof of receipt of such mail or, unless the recipient proves that the notice was received later or not received, three (3) days after date of mailing thereof.  Other notices shall be deemed given on the date of receipt.  Any party hereto may change the address specified herein by written notice to the other parties hereto.

 

Section 7.    The failure of either party to insist upon the strict performance of any of the terms, conditions and provisions of this Lock-Up Agreement shall not be construed as a waiver or relinquishment of future compliance therewith, and said terms, conditions and provisions shall remain in full force and effect.  No waiver of any term or condition of this Lock-Up Agreement on the part of either party shall be effective for any purpose whatsoever unless such waiver is in writing and signed by such party.

 

  

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IN WITNESS WHEREOF, the parties hereto have executed this Lock-Up Agreement as of the day and year first written above.

 

 

SELLER:

 

SWITCH GENIE, LLC

By: /s/ James Loughrey

           James Loughrey

President

BLUE EARTH, INC.

By: /s/ Johnny R. Thomas

Johnny R. Thomas

CEO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

4ex10-1.htm

Exhibit 10.1

 

FORBEARANCE AGREEMENT

 

This Agreement (the “Agreement”) is by and between Crownbutte Wind Power, Inc. (“Crownbutte”) and Stradley Ronon Stevens &Young, LLP (“Stradley”) (collectively, the “Parties”).

 

WHEREAS, Stradley has commenced an action against Crownbutte in the Court of Common Pleas of Philadelphia County, Pennsylvania captioned Stradley Ronon Stevens and Young, LLP v. Crownbutte Wind Power, Inc., Case No. 00318 November Term 2009 (hereinafter, the “Civil Action”);

 

WHEREAS, the Civil Action seeks to recover amounts due for legal services rendered in the amount of $93,525.67;

 

WHEREAS, Crownbutte has made certain payments to Stradley reducing the amount due and owing for legal services to $73,525.67;

 

WHEREAS, the Parties entered and filed a Consent Judgment in the Civil Action in the amount of $73,525.67 on March 9, 2011 (the “Consent Judgment”);

 

NOW, THEREFORE, for and in consideration of the covenants and promises contained herein; the Parties, intending to be legally bound hereby, agree as follows:

 

1.           Crownbutte has promised to make certain payments to satisfy the Consent Judgment as stated below, and Crownbutte has requested Stradley to forebear from execution on the Consent Judgment until the earlier of the expiration of this Agreement or an Event of Default, as defined herein.  Upon and subject to the terms and conditions set forth in this Agreement, Stradley is willing to forbear from executing on the Consent Judgment.

 

2.           During the term of this Agreement, Stradley shall receive from Crownbutte seventy-three thousand five hundred twenty-five dollars and sixty-seven cents ($73,525.67) (the “Amount Due”), which shall be paid as follows:

 

  

  

  

(a)           Monthly payments commencing immediately upon Crownbutte’s signing of this Agreement of $3,500 each (the “Monthly Payments”), with each Monthly Payment thereafter being due and payable on the 30th day of each month, subject to a five (5) day grace period. If any payment date falls on a Saturday, Sunday or holiday, the payment date shall be automatically extended until the next business day immediately thereafter. The Monthly Payments shall be remitted either by:

 

(i)           wire transfer in accordance with the following wire transfer instructions:

 

	
Bank:

	
Citizens Bank of Pennsylvania

	
ABA No.:

	
036076150

	
Credit to:

	
Stradley Ronon Stevens & Young LLP

	
Account No.  620096-961-6

	
Attn.: James H. Jenkins

 

(ii)           check payable to “Stradley Ronon Stevens & Young, LLP” in immediately available funds and delivered (unless Stradley otherwise advises in writing) to:

 

Patricia Byrne

Stradley Ronon Stevens & Young, LLP

2600 One Commerce Square

Philadelphia, PA 19103

(b)           The Monthly Payments shall increase to $7,000 per month commencing on the next payment date after Crownbutte is successful in receiving any funds in excess of $500,000 for project development, which financing shall be disclosed in a Form 8-K filed with the SEC and Crownbutte shall notify Stradley of such financing within thirty (30) days; and

 

  

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(c)           Crownbutte will issue, at $0.06 per share,  500,000 shares of its common stock (the “Shares”) and the Shares shall be included and registered in a Form S-8 Registration Statement to be filed by Crownbutte on or before April 29, 2011.   Stradley will have the right to immediately sell the Shares after the Form S-8 is filed and to reduce the Amount Due to Stradley.  Stradley may use its own broker dealer to sell the Shares or Crownbutte may refer Stradley to a broker dealer.  Crownbutte will cover the cost of all sales of the Shares.  All net proceeds from the sale of the Shares by Stradley will be applied to reduce the Amount Due to Stradley.  If Stradley is unable to sell any of the Shares, it will transfer the unsold Shares back to Crownbutte.  The balance due to Stradley for the Amount Due shall only be reduced upon Stradley’s sale of the Shares.

 

3.           If the Monthly Payments are timely delivered in strict accordance with this Agreement and Stradley receives the full Amount Due, then:

 

(a)           Stradley and Crownbutte shall be deemed to have released and forever discharged each other from any and all manner of actions and causes of action, suits, debts, dues, accounts, bonds, covenants, contracts, agreements, judgments, settlements, damages, claims, and demands for any matter whatsoever, including, without limitation, the Consent Judgment and the legal services referenced in the Civil Action; and

 

(b)           Stradley shall file a Praecipe to Satisfy the Consent Judgment in the Civil Action.

 

  

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4.           If Stradley does not receive the Amount Due, or if any of the payments, including the payment of the Shares, is not otherwise timely delivered in strict accordance with this Agreement (which shall be considered an “Event of Default”), then Stradley may immediately, and without notice or demand, institute and otherwise pursue any and all actions, rights and remedies against Crownbutte arising from or relating to the Consent Judgment including, without limitation, any transfers of said judgment and execution proceedings, to collect and enforce the Consent Judgment; and Stradley may, in its sole discretion, pursue the aforementioned action, and may also pursue any other actions, rights and remedies against any other person to execute upon the Consent Judgment and any other amounts to which it may be entitled under applicable law.  Any failure or delay in the exercise of any of Stradley’s rights shall not waive or otherwise impair a future exercise of such right.

 

5.           Crownbutte represents and warrants that it has all requisite power and legal capacity to execute, deliver and perform the provisions of this Agreement, and to perform the obligations hereunder.  Crownbutte agrees that this Agreement relates to a commercial transaction and not a consumer transaction.  Crownbutte also agrees that this Agreement constitutes the legal, valid and binding obligation of Crownbutte enforceable in accordance with the terms of this Agreement.

 

6.           The obligation of Stradley to forbear execution on the Judgment is subject to Stradley having received an executed copy of this Agreement from Crownbutte by April 1, 2011.  Any forbearance by Stradley in exercising its rights under this Agreement shall not be deemed to be a waiver or preclude the exercise of any of its rights under this Agreement, the Civil Action or the Consent Judgment.

 

7.           The Parties acknowledge that they enter into this Agreement knowingly and voluntarily, with complete understanding of the terms and the conditions of the Agreement.  The language used in this Agreement shall be deemed to be the language chosen by the parties to express their intent, no rule of strict construction shall be applied against any party, and nothing in this Agreement shall be deemed to be an admission of any allegation in the Civil Action.  In addition, Crownbutte acknowledges that Stradley has not counseled them in any manner whatsoever concerning this Agreement.

 

  

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8.           The provisions of this Agreement are intended to be severable.  If any provisions of this Agreement shall be held invalid or unenforceable in whole or in part in any jurisdiction such provision shall, as to such jurisdiction, be ineffective to the extent of such invalidity or unenforceability without in any manner affecting the validity or enforceability of such provision in any other jurisdiction or the remaining provisions of this Agreement in any jurisdiction.

 

9.           This Agreement shall be binding upon and inure to the benefit of the Parties and their past and present directors, shareholders, officers, agents, partners, employees, insurers, attorneys, servants, successors, and heirs and executors, and any parent, subsidiary, or affiliate thereof.

 

11.           The Parties represent and warrant that they have not sold, assigned, granted, or transferred to any other person or entity any such claim, demand, or cause of action, or any part thereof, that they may have or have had against each other.

 

12.           This Agreement shall be governed by the laws of the Commonwealth of Pennsylvania, without regard to any choice of law principles.

 

13.           This Agreement may not be modified except in a writing signed by the parties or their counsel.

 

14.           The Parties may execute this Agreement in counterparts, each of which shall be deemed to be an original and all of which shall be one and the same document.

 

  

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IN WITNESS WHEREOF, and intending to be legally bound by the terms of this Agreement, the Parties have executed this Agreement as of the date set forth below by those persons so authorized to act on their behalf.

 

 

 

	Crownbutte Wind Power, Inc.	 	 	Stradley Ronon Stevens & Young, LLP
	 	 	 	 
	 	 	 	 
	By:	
/s/ Mark Schaftlein

	 	 	By: 	
/s/ William R. Sasso

	 	Name: Mark Schaftlein	 	 	 	Name: William R. Sasso
	 	Title: CEO	 	 	Title:	Chairman
	 	 	 	 	 	 
	Sworn to and subscribed before me on this 22nd day of March, 2011	 	 	Sworn to and subscribed before me on this 23rd day of March, 2011

 

 

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