Document:

ex105.htm

NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.

 

CLASS B

 

COMMON STOCK PURCHASE WARRANTS

 

To Purchase   Shares of Common Stock of

 

COASTAL PACIFIC MINING CORP.

 

No.           Dated:

 

      THIS CLASS B COMMON STOCK PURCHASE WARRANT (the “Warrant”) CERTIFIES that, for value received,  (the “Holder”), is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the date of this Warrant and on or prior to the fifth anniversary of the date of this Warrant (the “Termination Date”) but not thereafter, to subscribe for and purchase from Coastal Pacific Mining Corp., an Nevada corporation (the “Company”), up to  shares (the “Warrant Shares”) of the Common Stock,  no par value  per share, of the Company (the “Common Stock”). The purchase price per share of Common Stock (the “Exercise Price”) under this Warrant shall be US$0.50. The Exercise Price and the number of Warrant Shares for which the Warrant is exercisable shall be subject to adjustment as provided herein. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Securities Purchase Agreement (the “Securities Purchase Agreement”), among the Company and the Purchaser parties signatory thereto (the date of such Agreement, the “Closing Date”). This Class B Warrant is being issued to certain Purchasers, along with a Class A Warrant, as more fully described in the Securities Purchase Agreement.  The Class A Warrant and the Class B Warrant are referred to collectively as the “Class A and B Warrants”.

 

1.           Title to Warrant.  Prior to the Termination Date and subject to compliance with applicable laws, including transfer restrictions imposed by applicable securities laws, and Section 7 of this Warrant, this Warrant and all rights hereunder are transferable, in whole or in part, at the office or agency of the Company by the Holder in person or by duly authorized attorney, upon surrender of this Warrant together with the Assignment Form annexed hereto properly endorsed. The transferee shall sign an investment letter in form and substance reasonably satisfactory to the Company.

 

  

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2           Authorization of Shares.  Except as provided in the Securities Purchase Agreement, the Company covenants that all Warrant Shares which may be issued from time to time upon the exercise of the purchase rights represented by this Warrant in accordance with the terms of this Warrant, including the payment of the exercise price for such Warrant Shares, will, upon exercise of the purchase rights represented by this Warrant, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue).

 

3.           Exercise of Warrant.

 

(a)           Subject to Section 3(c), exercise of the purchase rights represented by this Warrant may be made (i) no sooner than six (6) months after the final Closing Date (“Restricted Period”); provided, however, that upon termination of the Restricted Period, the Holder shall be entitled to exercise up to twenty-five percent (25%) of total Class A and Class B Warrants issued to the Holder in the six (6) month period following the Restricted Period (“Initial Exercise Period”); or (ii) at any time or times after the Initial Exercise Period, the balance of the Class A Warrants and Class B Warrants on or before 5 p.m., New York City time, on the Termination Date by delivery to the Company of a duly executed Notice of Exercise Form annexed hereto (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder at the address of such Holder appearing on the books of the Company) and surrender of this Warrant, together with payment of the aggregate Exercise Price of the shares thereby purchased by wire transfer or cashier’s check drawn on a United States bank in immediately available funds. In the event that an effective Registration Statement covering the Warrant Shares is not declared effective, the Holder may, at its discretion, effect a “cashless” exercise of the Warrant by surrendering the Warrant at the principal office of the Company, accompanied by a duly executed Notice of Exercise Form and a written notice stating the Holder’s intent to effect a cashless exercise, the shares of common stock to be issued upon exchange and the date on which the Holder’s requests that such exercise is to occur.  Upon a Holder’s cashless exercise, such Holder shall be entitled to receive a certificate for the number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

(A)  = the Closing Price on the Trading Day preceding the date of such election;

(B)  = the Exercise Price of the Warrants, as adjusted; and

(X)  = the number of Warrant Shares issuable upon exercise of the Warrants in accordance with the terms of this Warrant.

Certificates for Warrant Shares purchased hereunder shall be delivered to the Holder within three (3) Trading Days from the delivery to the Company of the Notice of Exercise Form, surrender of this Warrant and payment of the aggregate Exercise Price (or by means of a cashless exercise) as set forth above (“Warrant Share Delivery Date”). This Warrant shall be deemed to have been exercised on the later of the date the Notice of Exercise is delivered to the Company and the date the Exercise Price is received by the Company. The Warrant Shares shall be deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder of record of such shares for all purposes, as of the date the Warrant has been exercised by payment to the Company of the Exercise Price and all taxes required to be paid by the Holder, if any, pursuant to Section 

 

  

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5 prior to the issuance of such shares, have been paid. If the Company  shall fail for any reason or for no reason to issue to the Holder within three (3) Trading Days of receipt of the Notice of Exercise, a certificate for the Warrant Shares to which the Holder is entitled and register such Warrant Shares on the Company’s share register or to credit the Holder’s balance account with DTC for such number of Warrant Shares or other securities to which the Holder is entitled upon the Holder’s exercise of this Warrant, and if on or after such Trading Day the Holder purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares or other securities issuable upon such exercise that the Holder anticipated receiving from the Company (a “Buy-In” ), then the Company shall, within three (3) business days after the Holder’s request and in the Holder’s discretion, either (i) pay cash to the Holder in an amount equal to the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased (the “Buy-In Price” ), at which point the Company’s obligation to deliver such certificate (and to issue such Warrant Shares) shall terminate, or (ii) promptly honor its obligation to deliver to the Holder a certificate or certificates representing such Warrant Shares and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-In Price over the product of (A) such number of shares of Common Stock, times (B) the Closing Bid Price on the date of exercise.  Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.

(b)           If this Warrant shall have been exercised in part, the Company shall, at the time of delivery of the certificate or certificates representing Warrant Shares, deliver to Holder a new Warrant evidencing the rights of Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.

 

(c)           In no event shall the Holder be entitled to exercise such number of Warrants, which when added to the sum of the number of shares of Common Stock beneficially owned (as such term is defined under Section 13(d) and Rule 13d-3 of the 1934 Act), by the Holder, would exceed 4.99% of the number of shares of Common Stock outstanding on the Warrant Share Delivery Date, as determined in accordance with Rule 13d-1(j) of the 1934 Act.

 

4.           No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which Holder would otherwise be entitled to purchase upon such exercise, the Company shall pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price.

 

5.           Charges, Taxes and Expenses. Issuance of certificates for Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such certificate, all of which taxes and expenses shall be paid by the Company, and such certificates shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however, that in the event certificates for Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder; and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto.

 

  

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6.           Closing of Books.  The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.

 

7.           Transfer, Division and Combination.

 

(a)           Subject to compliance with any applicable securities laws and the conditions set forth in Sections 1 and 7(e) hereof and to the provisions of the Securities Purchase Agreement, this Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. A Warrant, if properly assigned, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.  Notwithstanding the foregoing, the Holder will not voluntarily and knowingly assign or transfer this Warrant or the Warrant Shares to any direct competitor of the Company without the Company’s prior written consent.

 

(b)           This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 7(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice.

 

(c)           The Company shall prepare, issue and deliver at its own expense (other than transfer taxes) the new Warrant or Warrants under this Section 7.

 

(d)           The Company agrees to maintain, at its aforesaid office, books for the registration and the registration of transfer of the Warrants.

 

(e)           The Company may require, as a condition of allowing such transfer (i) that the Holder or transferee of this Warrant, as the case may be, furnish to the Company a written opinion of counsel reasonably acceptable to the Company (which opinion shall be in form, substance and scope customary for opinions of counsel in comparable transactions) to the effect that such transfer may be made without registration under the Securities Act and under applicable state securities or blue sky laws, (ii) that the holder or transferee execute and deliver to the Company an investment letter in form and substance acceptable to the Company and (iii) that the transferee be an “accredited investor” as defined in Rule 501(a) promulgated under the Securities Act or a qualified institutional buyer as defined in Rule 144A(a) under the Securities Act.

  

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8.           No Rights as Shareholder until Exercise.  This Warrant does not entitle the Holder to any voting rights or other rights as a shareholder of the Company prior to the exercise hereof. Upon the surrender of this Warrant and the payment of the aggregate Exercise Price, the Warrant Shares so purchased shall be and be deemed to be issued to such Holder as the record owner of such shares as of the close of business on the later of the date of such surrender or payment.

 

9.           Loss, Theft, Destruction or Mutilation of Warrant.  The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.

 

10.           Saturdays, Sundays, Holidays, etc.                                                                If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall be a Saturday, Sunday or a legal holiday, then such action may be taken or such right may be exercised on the next succeeding day not a Saturday, Sunday or legal holiday.

 

11.           Adjustments of Exercise Price and Number of Warrant Shares.                                                                                                           

 

(a)            The number and kind of securities purchasable upon the exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time upon the happening of any of the following:  in case the Company shall (i) pay a dividend in shares of Common Stock or make a distribution in shares of Common Stock to holders of its outstanding Common Stock; (ii) subdivide its outstanding shares of Common Stock into a greater number of shares; (iii) combine its outstanding shares of Common Stock into a smaller number of shares of Common Stock; or (iv) issue any shares of its capital stock in a reclassification of the Common Stock, then the number of Warrant Shares purchasable upon exercise of this Warrant immediately prior thereto shall be adjusted so that the Holder shall be entitled to receive the kind and number of Warrant Shares or other securities of the Company which it would have owned or have been entitled to receive had such Warrant been exercised in advance thereof. Upon each such adjustment of the kind and number of Warrant Shares or other securities of the Company which are purchasable hereunder, the Holder shall thereafter be entitled to purchase the number of Warrant Shares or other securities resulting from such adjustment at an Exercise Price per Warrant Share or other security obtained by multiplying the Exercise Price in effect immediately prior to such adjustment by the number of Warrant Shares purchasable pursuant hereto immediately prior to such adjustment and dividing by the number of Warrant Shares or other securities of the Company that are purchasable pursuant hereto immediately after such adjustment. An adjustment made pursuant to this paragraph shall become effective immediately after the effective date of such event retroactive to the record date, if any, for such event.

 

  

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(b)           In the event that on or subsequent to the Closing Date, the Company issues or sells any Common Stock, any convertible securities, or any warrants or other rights to subscribe for or to purchase or any options for the purchase of its Common Stock or any such convertible securities (other than (i) shares which are issued pursuant to the Warrants or the Company’s 10% Senior Secured Convertible Promissory Notes (“Notes”) being issued pursuant to the Securities Purchase Agreement, (ii) shares of Common Stock or options to purchase such shares issued to employees, consultants, officers or directors in accordance with stock plans stock option plans approved by the Company’s board of directors and existing on the date hereof, and shares of Common Stock issuable under employment or consulting agreements, existing loan agreements, options, or warrants that are outstanding as of the date hereof, or (iii) shares of Common Stock issued pursuant to a stock dividend, split or other similar transaction) at an effective price per share which is less than the then applicable Exercise Price (such effective price per share, the “Adjusted Exercise Price”), then the Exercise Price in effect immediately prior to such issue or sale shall be reduced effective concurrently with such issue or sale to an amount equal to the Adjusted Exercise Price, provided, however, that the Adjusted Exercise Price shall at no time be equal to less than $0.35 per share as a result of this Section 11(b).

 

12.           Reorganization, Reclassification, Merger, Consolidation or Disposition of Assets. In case the Company shall reorganize its capital, reclassify its capital stock, consolidate or merge with or into another corporation (where the Company is not the surviving corporation or where there is a change in or distribution with respect to the Common Stock of the Company), or sell, transfer or otherwise dispose of its property, assets or business to another corporation and, pursuant to the terms of such reorganization, reclassification, merger, consolidation or disposition of assets, shares of common stock of the successor or acquiring corporation, or any cash, shares of stock or other securities or property of any nature whatsoever (including warrants or other subscription or purchase rights) in addition to or in lieu of common stock of the successor or acquiring corporation (“Other Property”), are to be received by or distributed to the holders of Common Stock of the Company, then, from and after the consummation of such transaction or event, the Holder shall have the right thereafter to receive, instead of the Warrant Shares, at the option of the Holder, (a) upon exercise of this Warrant, the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and Other Property receivable upon or as a result of such reorganization, reclassification, merger, consolidation or disposition of assets by a Holder of the number of shares of Common Stock for which this Warrant is exercisable immediately prior to such event or (b) if the Company is acquired in an all cash transaction, cash equal to the value of this Warrant as determined in accordance with the Black-Scholes option pricing formula. For purposes of this Section 12, “common stock of the successor or acquiring corporation” shall include stock of such corporation of any class which is not preferred as to dividends or assets over any other class of stock of such corporation and which is not subject to redemption and shall also include any evidences of indebtedness, shares of stock or other securities which are convertible into or exchangeable for any such stock, either immediately or upon the arrival of a specified date or the happening of a specified event and any warrants or other rights to subscribe for or purchase any such stock. The foregoing provisions of this Section 12 shall similarly apply to successive reorganizations, reclassifications, mergers, consolidations or disposition of assets.

 

  

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13.           Notice of Adjustment.  Whenever the number of Warrant Shares or number or kind of securities or other property purchasable upon the exercise of this Warrant or the Exercise Price is adjusted, as herein provided, the Company shall give notice thereof to the Holder, which notice shall state the number of Warrant Shares (and other securities or property) purchasable upon the exercise of this Warrant and the Exercise Price of such Warrant Shares (and other securities or property) after such adjustment, setting forth a brief statement of the facts requiring such adjustment and setting forth the computation by which such adjustment was made.

 

14.           Other Adjustments.  If any event occurs of the type contemplated by the provisions of Sections 11 or 12 but not expressly provided for by such provisions (including, without limitation, the granting of stock appreciation rights, phantom stock rights or other rights with equity features), then the Company’s Board of Directors will make an appropriate adjustment in the Exercise Price and/or the number of shares of Common Stock and other securities or property to be issued to the Holder upon exercise of the Warrant so as to protect the rights of the Holder; provided that no such adjustment pursuant to Sections 11 or 12 will increase the Exercise Price or decrease the number or amount of securities or other property issuable or deliverable to the Holder as otherwise determined pursuant to Sections 11 and/or 12.

 

15.           Notice of Corporate Action.  If at any time:

 

(a)           the Company shall take a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend or other distribution, or

 

(b)           there shall be any capital reorganization of the Company, any reclassification or recapitalization of the capital stock of the Company or any consolidation or merger of the Company with, or any sale, transfer or other disposition of all or substantially all the property, assets or business of the Company to, another corporation or,

 

(c)           there shall be a voluntary or involuntary dissolution, liquidation or winding up of the Company; then, in any one or more of such cases, the Company shall give to Holder (i) prior written notice of the date on which a record date shall be selected for such dividend or distribution or for determining rights to vote in respect of any such reorganization, reclassification, merger, consolidation, sale, transfer, disposition, liquidation or winding up, and (ii) in the case of any such reorganization, reclassification, merger, consolidation, sale, transfer, disposition, dissolution, liquidation or winding up, prior written notice of the date when the same shall take place. Such notice in accordance with the foregoing clause also shall specify (i) the date on which the holders of Common Stock shall be entitled to any such dividend or distribution, and the amount and character thereof, and (ii) the date on which any such reorganization, reclassification, merger, consolidation, sale, transfer, disposition, dissolution, liquidation or winding up is to take place and the time, if any such time is to be fixed, as of which the holders of Common Stock shall be entitled to exchange their Warrant Shares for securities or other property deliverable upon such disposition, dissolution, liquidation or winding up. Each such written notice shall be sufficiently given if addressed to Holder at the last address of Holder appearing on the books of the Company and delivered in accordance with Section 16(d).

  

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16.           Authorized Shares.  Except as provided in the Securities Purchase Agreement, the Company covenants that during the period the Warrant is outstanding, it will take all reasonable action to ensure that the Company is authorized to issue a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.   The Company shall also reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of executing stock certificates to execute and issue the necessary certificates for the Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed.

 

Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (a) not increase the par value of any Warrant Shares above the amount payable therefore upon such exercise immediately prior to such increase in par value, (b) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant, and (c) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof as may be necessary to enable the Company to perform its obligations under this Warrant.

 

Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.

 

17.           Miscellaneous.

 

(a)   Jurisdiction.  All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance with the provisions of the Securities Purchase Agreement relating to the same.

 

(b)   Restrictions.  The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered for resale, will have restrictions upon resale imposed by state and federal securities laws.

 

(c)    Nonwaiver and Expenses.  No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice Holder’s rights, powers or remedies, notwithstanding all rights hereunder terminate on the Termination Date. If the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred by Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.

 

  

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(d)          Notices.  Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered in accordance with the notice provisions of the Securities Purchase Agreement.

 

(e)           Limitation of Liability.       No provision hereof, in the absence of any affirmative action by Holder to exercise this Warrant or purchase Warrant Shares, and no enumeration herein of the rights or privileges of Holder, shall give rise to any liability of Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.

 

(f)           Successors and Assigns.  Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of all Holders from time to time of this Warrant and shall be enforceable by any such Holder or holder of Warrant Shares.

 

(g)           Amendment.  This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

 

(h)           Severability.  Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.

 

(i)           Headings.  The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.

 

(j) Disputes.  In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the securities or other property, the Company shall promptly issue and deliver to the Holder the securities or other property that are not disputed.

 

(k) Remedies.  The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under Section 3 of this Warrant.  The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of Section 3 of this Warrant and hereby agrees to waive the defense in any action for specific performance that a remedy at law would be adequate.

 

  

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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized.

 

Dated:                            , 2010

 

 

COASTAL PACIFIC MINING CORP.

 

By:__________________________________________

Name:

Title:

 

  

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NOTICE OF EXERCISE

 

To:           Coastal Pacific Mining Corp.

 

(1)           The undersigned hereby elects to purchase           Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.

 

(2)           Payment shall be made by wire transfer or cashier’s check drawn on a United States bank in immediately available funds.

 

(3)           Please issue a certificate or certificates representing said Warrant Shares in the name of the undersigned or in such other name as is specified below:

 

________________________________________

 

 

The Warrant Shares shall be delivered to the following:

 

________________________________________

 

________________________________________

 

________________________________________

 

________________________________________

 

________________________________________

 

________________________________________

 

________________________________________

 

 

 (4)           Accredited Investor.  The undersigned is an “accredited investor” as defined in Regulation D under the Securities Act of 1933, as amended.

 

[PURCHASER]

By: ___________________________

Name:

Title:

Dated: ________________________

  

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ASSIGNMENT FORM

(To assign the foregoing warrant, execute this form and supply required information. Do

not use this form to exercise the warrant.)

FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to _______________________________________________ whose address is _________________________________________________________.

 

Dated: ______________, _______

Holder’s Signature                      ____________________________

Holder’s Address:                        ____________________________

        ___________________________  

                                                        ____________________________

Signature Guaranteed: ___________________________________________

NOTE: The signature to this Assignment Form must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement or any change whatsoever, and must be guaranteed by a bank or trust company. Officers of corporations and those acting in a fiduciary or other representative capacity should file proper evidence of authority to assign the foregoing

  

12exhibit10_1.htm

EXHIBIT 10.1

***  Indicates material has been omitted pursuant to a Confidential Treatment Request filed with the Securities and Exchange Commission.  A complete copy of this agreement has been filed separately with the Securities and Exchange Commission.

PROFESSIONAL SERVICES AGREEMENT

FOR

TXU ENERGY’S

2009 iTHERMOSTAT PROGRAM

AN INTERNET AND AMI BASED LOAD MANAGEMENT SYSTEM

WITH ZIGBEE HOME AREA NETWORK

BY AND BETWEEN

COMVERGE INC.

AND

TXU ENERGY RETAIL COMPANY LLC

DATED APRIL 15, 2009

CONTRACT NO.  C 0600559 C

Redacted Agreement

 

 

  

  

  

The effective date of this Agreement is April 15, 2009.

PARTIES

A.           COMPANY

TXU Energy Retail Company LLC, a Texas limited liability company.

6555 Sierra Dr

Irving, Texas 75039

B.           CONTRACTOR

Comverge Inc., a Delaware corporation

120 Eagle Rock Ave S190

East Hanover, NJ 07853

PURPOSE

The purpose of this Agreement is to provide for the performance of the Work described in the Statement of Work attached provision for and in consideration of the mutual obligations set forth in this Agreement.

DEFINITIONS

A.           COMPANY Group

The term "COMPANY Group" means COMPANY, its parent corporation, Energy Future Holdings Corp., and all subsidiaries and affiliates of Energy Future Holdings Corp., and all officers, directors, shareholders, associates, related firms and entities, employees, servants and agents of both COMPANY and each such subsidiary or affiliate.

B.           Contract Coordinator

The term “Contract Coordinator” means a representative of each party named in this Agreement to act in matters related to performance of this Agreement as it is written.  Actions of the Contract Coordinators regarding the day-to-day interaction between the operations of the parties, the issuance and approval of invoices, the issuance and approval of procedures, drawings, schedules and documents of any type, and other decisions made in managing this Agreement will not operate as a waiver or compromise of any provision of this Agreement.

C.           Contract Administrator

The term "Contract Administrator" means representatives of both parties named in this Agreement to act in matters relating to the revision of contract language, the adjustment of compensation or time and the resolution of issues regarding the meaning of contract language.

 

 

  

  

  

	
D.

	
Contractor

The term “Contractor” means Comverge Inc. and as designated in this Agreement, with respect to the Work to be performed by such Contractor hereunder.

E.           CONTRACTOR Group

The term "CONTRACTOR Group" means the respective CONTRACTOR, all subcontractors of any tier employed by CONTRACTOR, and all affiliated or related firms and entities, officers, directors, partners, limited partners, shareholders, associates, employees, servants and agents of each.

F.           Parties

The term "Parties" means, collectively, COMPANY and CONTRACTOR.

G.           Work

The term "Work" means all labor, materials, equipment, transportation, facilities or services necessary for each respective Contractor to perform its portion of the Statement(s) of Work described in this Agreement.

H.           Work Site

The term "Work Site" means location(s) where the Work will be performed as specified in the applicable Statement of Work.

SCOPE OF WORK

CONTRACTOR will perform its portion of the work according to the applicable attached Statement of Work.

TERM OF AGREEMENT

The term of this Agreement shall commence on the Effective Date and shall continue through December 31, 2009 (the “Initial Term),” and then shall automatically renew for successive one-year terms (each such one-year term a “Renewal Term”), unless the Agreement is terminated earlier pursuant to the other provisions of this hereof or unless at least 30 calendar days prior to the end of the Initial Term or any Renewal Term, either Party provides written notice to the other Party that it elects not to renew the Agreement, in which case this Agreement will terminate at the end of the Initial Term or Renewal Term then in effect.  The foregoing notwithstanding, in no event shall this Agreement continue in effect for longer than 10 years after the Effective Date. 

 

 

  

  

  

 

COMPENSATION

As full compensation for the satisfactory performance by CONTRACTOR of this Agreement, COMPANY will compensate each CONTRACTOR in accordance with the attached Statement of Work.

INVOICES AND PAYMENT

CONTRACTOR will submit invoices for fees and expenses on a monthly basis.  COMPANY will make payments within thirty (30) days after receipt of invoice or within thirty (30) days after resolution of invoice errors or disputes, whichever is later.  Invoices must be supported by documentation deemed sufficient by COMPANY's Contract Coordinator to verify the charges.

All invoices will be sent to:

                                                      TXU Energy Retail Company LLC

                               6555 Sierra Drive

Irving, Texas 75039

                                                      Attn:  ***

TAXES

CONTRACTOR will comply with all federal, state, or municipal laws, rules and regulations regarding taxes and the payment of taxes, until the Services have been completed, including, without limitation, social security, state unemployment insurance, gross receipts taxes, withholding taxes, and income tax.  CONTRACTOR will furnish, upon request by COMPANY, satisfactory evidence of its compliance.  COMPANY shall pay all sales and applicable use taxes.

INDEPENDENT CONTRACTOR RELATIONSHIP

CONTRACTOR will act as and be deemed to be an independent contractor.  Neither CONTRACTOR nor any of its employees will act as, nor be deemed to be, an agent or employee of COMPANY.  CONTRACTOR will have the sole right to control and directly supervise the method, manner and details of the Services.

ASSIGNMENT

CONTRACTOR will not assign, transfer or otherwise dispose of any of its obligations or duties without the prior written approval of COMPANY.  Any assignment or transfer made without the express written approval of COMPANY will be null and void.

SUBCONTRACTING

*** (provided that the foregoing prohibition on subcontracting shall not apply to Digi International), and CONTRACTOR will not be relieved of any duty or liability relating to any Work by reason of subcontracting.  Notwithstanding the forgoing, except as expressly provided herein with respect to Digi International, there will be no contractual relationship between COMPANY and any subcontractor by virtue of this Agreement.

 

 

  

  

  

BINDING ON SUCCESSORS AND ASSIGNS

This Agreement will inure to the benefit of and be binding upon the undersigned parties and entities, and their respective legal representatives, successors and assigns.

CONDITIONS AFFECTING WORK

CONTRACTOR will investigate and acquaint itself with the conditions affecting the Work. CONTRACTOR's failure to acquaint itself with any conditions affecting the Work or any available related information will not relieve it from responsibility for properly estimating the difficulty or cost of successfully performing the Work.

COMPANY is not responsible for any conclusions or interpretations made by CONTRACTOR from the information made available by COMPANY, other than information contained in or referenced in this Agreement.  CONTRACTOR will draw its own conclusions from its review of any and all data and information provided by COMPANY.

CONTRACTOR assumes full responsibility for investigating conditions and determining the existence and magnitude of any hazards to the physical well-being of property of CONTRACTOR, the employees, agents, and servants of CONTRACTOR, or any other person or entity who is or may become involved in the performance of Work, and any and all other persons in the vicinity of the Work.  CONTRACTOR will advise all of the above-specified persons or entities of any hazards relating to Work, and will ensure that those persons or entities are advised of and fully understand the nature of the hazards and safety precautions that can be taken to eliminate or minimize dangers relating to the hazards.

PERFORMANCE STANDARDS

In performing the Work for COMPANY, CONTRACTOR will conform and otherwise ensure that the Work conforms to the specifications and output and delivery standards set forth in this Section and all other warranties and standards of performance provided for in the applicable Statement of Work (the “Performance Standards”).

CHANGES IN WORK

COMPANY may by written notice, make changes in, additions to, or deletions from the Work.  If any change significantly increases the time required to perform the Work, an equitable adjustment will be made in the schedule and pricing for the performance and completion of the Work.  If the Work is being performed on a fixed price basis, and if any change significantly increases or decreases the cost to CONTRACTOR of performing the Work, then an equitable adjustment will be made in the price.

In order to receive an equitable adjustment in price or schedule, CONTRACTOR must provide a written request for that adjustment within five (5) working days after receiving COMPANY's notice of a change in the Work.  CONTRACTOR will continue to perform the changed Work prior to or pending Agreement on an equitable adjustment and will not halt or delay performance of the Work because of any failure to reach an Agreement on an adjustment.

 

 

  

  

  

BACKGROUND CHECKS/DRUG SCREENING

Prior to personnel performing Work for COMPANY hereunder and at least annually thereafter, CONTRACTOR will conduct (i) background checks (covering such matters as dictated by COMPANY from time to time, but in no case less than what COMPANY is required to conduct with respect to its own employees under applicable laws and regulations) and (ii) drug tests on all CONTRACTOR Agents and applicants utilized in connection with the Work hereunder. No person shall perform services for COMPANY if such person has a prior felony conviction or if such person tests positively for illegal substances. 

 

IDENTITY OF CONTRACTOR GROUP PERSONNEL

 

Upon request by COMPANY, CONTRACTOR shall promptly make known to COMPANY the names and identity of any CONTRACTOR Group person interacting with COMPANY’s customers or performing Work at COMPANY’s customers’ locations.

 

NO THIRD-PARTY RIGHTS

 

Nothing in this Agreement (including any attachments) shall create, or be construed as creating, any express or implied rights in any person or entity other than the Parties except that the members of COMPANY Group are express third-party beneficiaries of any section that specifically names it.

 

 

FORCE MAJEURE

If either party becomes unable, either wholly or in part, by an event of Force Majeure, to fulfill its obligations under this Agreement, the obligations affected by the event of Force Majeure will be suspended only during the continuance of that inability.  The party so affected will give written notice of the existence, extent and nature of the Force Majeure to the other party within *** (***) hours after the occurrence of the event.  The party so affected will remedy its inability as soon as possible.  Failure to give notice will result in the continuance of the affected party's obligation regardless of the extent of any existing Force Majeure.

The term "Force Majeure" as used in this Agreement means acts of God (except as excluded herein), any event outside of the reasonable control of the party (and which could not be reasonably anticipated and prevented through the use of reasonable measures), including without *** agency of the United States or of any States, *** events of Force Majeure.

SUSPENSION FOR CONVENIENCE

***, *** Upon receipt of such notice, CONTRACTOR will, unless the notice requires otherwise:

	
a)

	
immediately discontinue Work on the date and to the extent specified in the notice;

	
b)

	
place no further orders or subcontracts for material, services or facilities with respect to suspended Work other than to the extent required in the notice;

	
c)

	
promptly make every reasonable effort to obtain suspension upon terms satisfactory to COMPANY of all orders, subcontracts and rental agreements to the extent they relate to performance of suspended Work; and

	
d)

	
take any other reasonable steps to minimize costs associated with such suspension.

As full compensation for suspended Work, CONTRACTOR will be entitled to an equitable adjustment in its compensation as follows:

	
a)

	
***

	
b)

	
***

Upon receipt of notice to resume Work, CONTRACTOR will immediately resume Work in accordance with the notice to resume Work.  If CONTRACTOR intends to assert a claim for equitable adjustment, it must, within seven (7) days after receipt of notice to resume Work, submit to COMPANY a written statement setting forth the schedule impact and the monetary amount of the claim in sufficient detail to permit thorough analysis.

 

 

  

  

  

SUSPENSION FOR CAUSE

In addition to the other remedies provided COMPANY in this Agreement, COMPANY has the right to order the temporary suspension of any Work when it determines, in its reasonable discretion, that performance of the Work is not being conducted in a safe or lawful manner, the specified quality of the Work is not being met in any material respect, or the Work is not otherwise being performed in all material respects in accordance with the requirements of this Agreement. (However, COMPANY will not use any diminished performance occurring during a suspension hereunder in order to invoke a subsequent suspension due solely to such diminished performance occurring during the prior suspension hereunder.)

 

If any unsatisfactory condition of a portion of any Work performed hereunder is brought to CONTRACTOR's attention, and is corrected by CONTRACTOR (e.g., retraining its personnel) to COMPANY’s reasonable satisfaction, COMPANY will authorize CONTRACTOR to resume the Work.  Should CONTRACTOR fail to promptly correct the unsatisfactory condition to COMPANY’s reasonable satisfaction, CONTRACTOR will be considered in breach of this Agreement. 

TERMINATION

***.  The notice of termination will specify the effective date of any termination, and the Work or any part of the Work to be terminated, or alternatively, that this Agreement is terminated in its entirety.

CONTRACTOR will discontinue Work in accordance with COMPANY's termination instructions.  Upon receiving notice of termination, CONTRACTOR will place no further orders, or enter into further subcontracts for services, materials or equipment related to the terminated Work.  In addition, CONTRACTOR will delay or terminate all existing orders and subcontracts, insofar as those orders and subcontracts relate to the performance of the Work terminated.  ***, ***, *** (***), COMPANY shall have the right to receive all such products paid for), subcontractors, plant, forces and equipment.   In addition, but without duplication, for any termination for convenience by COMPANY where COMPANY provides less than 90 days prior written notice, COMPANY shall ***.

If COMPANY fails to pay when due any undisputed amount owed by COMPANY to CONTRACTOR hereunder, then CONTRACTOR shall be entitled, as its sole remedy, to terminate this Agreement and take any action allowed by law to collect such amounts owed by COMPANY, provided CONTRACTOR has first provided thirty (30) days written notice to COMPANY specifying the failure, during which time COMPANY will have the right and opportunity to cure the failure prior to such termination.

Either Party may terminate this Agreement if the ***, provided such terminating Party has first provided thirty (30) days written notice to such breaching Party specifying the failure, during which time such breaching Party will have the right and opportunity to cure the failure prior to such termination.

Except as expressly provided in the third paragraph above, in the event this Agreement or the Work is terminated, COMPANY's only liability will be to pay CONTRACTOR the unpaid balance due CONTRACTOR for Work actually performed.

There will be deducted from any unpaid balance due CONTRACTOR the amounts of all claims of COMPANY against CONTRACTOR, including, but not limited to, claims on account of defect in materials and workmanship.

  

  

  

WARRANTY

CONTRACTOR agrees and warrants that its employees, agents and subcontractors will perform the Work ***, in accordance with ***, with a ***. ***, ***, *** (“***”), except where specific Work items have been specified to have a longer warranty, unless the failure was the result of, ***.

Upon written notice from COMPANY that any of the Work performed by CONTRACTOR fails to conform to any of the above-specified warranties, CONTRACTOR will, at no additional cost to COMPANY, properly remedy the failure and re-perform any Work necessary so that the Work conforms to those warranties. CONTRACTOR further warrants any and all corrected or re-performed Work to be free from defects in design, materials and workmanship for the greater time period of either (i) the remaining Warranty Period or a period of *** months following the corrected or re-performed Work.

 THIS WARRANTY IS IN LIEU OF ALL OTHER WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE. COMPANY'S SOLE REMEDY FOR ANY BREACH OF THIS WARRANTY IS THE REPAIR OR REPLACEMENT, AT CONTRACTOR’S OPTION, OF THE FAILED ITEM. CONTRACTOR SPECIFICALLY DISCLAIMS ANY AND ALL WARRANTIES, EXPRESS OR IMPLIED, TO CUSTOMERS OF COMPANY.

RECORDS AND RIGHTS TO AUDIT

(a)           CONTRACTOR will keep accurate and complete books of accounts, records, documents and other evidence related to the charges for and performance of any Work (including records and documents related to CONTRACTOR’s compliance with its drug testing and background check requirements) (collectively, “Records”), and of any change or modification to the Work.  COMPANY may inspect those records and CONTRACTOR’s facilities at any time during normal business hours.

 

(b)           ***.  COMPANY will bear the expenses incurred by it in supporting any such inspection or audit; provided, however, that should any audit or investigation produce evidence that CONTRACTOR has knowingly overstated charges or units of measure upon which charges are based, or provided gifts, gratuities or other benefits to employees of COMPANY in violation of the terms of this Agreement, CONTRACTOR will be liable to COMPANY for actual damages, including cost of audit and investigation.

 

BUSINESS ETHICS

CONTRACTOR represents and warrants that neither it nor any person or entity associated in any manner with CONTRACTOR has, or during the term of this Agreement will:

	
1)

	
Provide or offer any compensation or benefit of any type, including any gift or gratuity, other than advertising mementos of nominal value or reasonable business meals and business entertainment, to any COMPANY System employee;

	
2)

	
Maintain or establish any undisclosed business affiliation that could constitute or give the appearance of a conflict with the interests of the COMPANY System.

If, during the term of this Agreement, CONTRACTOR knows or becomes aware of any facts or circumstances contrary to the representations and the warranties above, CONTRACTOR will immediately notify COMPANY and provide sufficient information for COMPANY to take appropriate protective or corrective actions.  CONTRACTOR further agrees to cooperate fully in any investigation undertaken by COMPANY.

CONTRACTOR, if requested by COMPANY, agrees to require its employees to execute an ethics/nondisclosure agreement at any time.

 

 

  

  

  

CONFLICT OF INTEREST

CONTRACTOR will not engage in any activity that will adversely affect or impair its ability to perform the Work in an independent and reliable manner.  CONTRACTOR warrants that it has no professional or contractual obligations that will conflict with its performance of any Work.

PROTECTION AGAINST LIENS AND ENCUMBRANCES

CONTRACTOR will not at any time permit any lien, attachment or other encumbrance ("Encumbrance") by any person or persons whosoever or by reason of any claim or demand against CONTRACTOR to be placed or remain on the property of COMPANY or COMPANY’s customers, including, but not limited to, the Work Site upon which Work is being performed or equipment and materials that are being furnished.  To prevent an Encumbrance from being placed on the property of COMPANY or COMPANY’s customers, CONTRACTOR will furnish during the progress of any Work, as requested from time to time, verified statements showing CONTRACTOR's total outstanding indebtedness in connection with the Work.

If CONTRACTOR allows any indebtedness to accrue to subcontractors or others and fails to pay, discharge, or institute corrective measures that promptly rectifies that indebtedness, within five (5) days after demand, then COMPANY may withhold any money due CONTRACTOR until that indebtedness is paid or pay the indebtedness and apply that amount against the money due CONTRACTOR.

If CONTRACTOR allows any Encumbrances, whether valid or invalid to be placed on the property of COMPANY or COMPANY’s customers, any and all claims or demands for payment to CONTRACTOR will be denied by COMPANY until the Encumbrance is removed.  If the Encumbrance is not removed immediately, COMPANY may pay that claim on demand and deduct the amount paid, together with all related expenses, including attorneys' fees, from any further payment due CONTRACTOR, or at COMPANY's election, CONTRACTOR will, upon demand, reimburse COMPANY for the amount paid and all related expenses.  Any payment made in good faith by COMPANY will be binding on CONTRACTOR.

WAIVER OF CONSEQUENTIAL DAMAGES

Neither party will be liable to the other in contract, tort, or on any other basis, for any consequential damages of any nature, including, but not limited to***.  Consequential damage also includes attorneys' fees, except as otherwise specifically provided for, in this Agreement and it is expressly understood that this paragraph will be subjugated to, and will not limit or otherwise affect in any manner, the obligations to indemnify and hold harmless as provided for in the Confidentiality, Indemnity, Compliance with Laws, Restrictive Covenant and Intellectual Property provisions of this Agreement or the obligations as provided for in the Warranty of this Agreement.

INDEMNIFICATION

CONTRACTOR agrees to and will defend, protect, indemnify and hold harmless COMPANY Group from and against all claims, losses, expenses, attorneys’ fees, damages, demands, judgments, causes of action, suits, and liability in tort, contract, or any other basis and of every kind and character whatsoever (hereinafter in this and the following paragraphs collectively referred to as "CLAIMS"), for personal injury, death, or property damage of any member of CONTRACTOR Group, arising out of or incident to or related in any way to, directly or indirectly, this Agreement, or the Work, services, or materials to be performed or supplied thereunder, or to any activities of any member of CONTRACTOR Group while on any premises actually or allegedly owned, controlled, or operated by COMPANY,  including, but not limited to, CLAIMS arising out of or resulting from (1) any condition of the premises, (2) separate operations being conducted on the premises, or (3) the imperfection or defective condition, whether latent or patent, of any material or equipment sold, supplied, or furnished by COMPANY; and further, IT IS THE EXPRESS INTENT OF THE PARTIES THAT, FOR THE PURPOSES OF THIS PARAGRAPH, CLAIMS, AND CONTRACTOR's OBLIGATIONS TO DEFEND, PROTECT, INDEMNIFY, AND HOLD HARMLESS, WILL INCLUDE, BUT NOT BE LIMITED TO, CLAIMS ARISING OUT OF OR RESULTING FROM COMPANY GROUP's *** (1) NEGLIGENCE, (2) STRICT LIABILITY, OR (3) ***.

For all CLAIMS except those for personal injury, death, or property damage of any member of CONTRACTOR GROUP within the scope of the preceding paragraph, CONTRACTOR agrees to and will defend, protect, indemnify, and hold harmless COMPANY ***, directly or indirectly, this Agreement, or the Work, services, or materials to be performed or supplied thereunder.

To the extent necessary to permit COMPANY to enforce any term, clause, or condition of this Agreement, CONTRACTOR agrees that with respect to any CLAIMS brought against COMPANY Group, CONTRACTOR will and does hereby waive as to COMPANY Group any defense it may have by virtue of the workers’ compensation laws of any state.

 

 

  

  

  

INTELLECTUAL PROPERTY

CONTRACTOR will obtain permission to use any and all intellectual property, derived in whole or part that may be required in order for CONTRACTOR to perform the Work.  This permission will include all necessary licenses and other governmental approvals.

CONTRACTOR will hold harmless and indemnify COMPANY Group from and against, and at COMPANY's option, defend COMPANY Group against, any and all fines, penalties, losses, liabilities, damages, claims and costs (including reasonable attorneys' fees and court costs), arising out of or incurred as a result, directly and indirectly, of any alleged or actual infringement or violation of any right, or alleged right, relating to intellectual property, including, but not limited to, patent, copyright or trade secret.  This indemnification shall not extend to any claim based on ***.

In addition, if any claim is brought alleging infringement or the violation of any intellectual property right, CONTRACTOR will avoid any further possible infringement of the intellectual property right, and will seek to resolve the claim in consultation with COMPANY, either by means of alternative arrangements for the Services, or by obtaining permission to use the intellectual property in question.

COMPLIANCE WITH LAWS

CONTRACTOR represents that it is knowledgeable of and will comply with all federal, state, and local laws, rules, decrees, orders, regulations, by-laws, ordinances and codes that may, in any manner, affect the conduct of the Work. CONTRACTOR further represents and warrants that it has read and will comply with “Rule 25.474 of the Public Utility Commission of Texas” (the current version of which is attached as Attachment 3).  Any violations of the Customer Protection rules by CONTRACTOR, as well as any conduct in performance of this Agreement, that is in violation of any federal, state, or local enactment, as specified above, is a breach of this Agreement.

CONTRACTOR, with regard to its employees, assumes and retains sole and complete responsibility and liability for compliance with any and all federal, state, and local antidiscrimination statutes, including, but not limited to, Title VII of the Civil Rights Act of 1964, as amended; the Civil Rights Act of 1991; the Equal Pay Act of 1963; the Age Discrimination in Employment Act of 1967, as amended; the Energy Reorganization Act of 1974; the Texas Commission on Human Rights Act; the Americans with Disabilities Act; and the Older Workers Benefit Protection Act of 1990.  CONTRACTOR will promptly advise COMPANY of any action required to be initiated by COMPANY in order to comply with those statutes.

If fines, penalties or legal costs are assessed against COMPANY Group by any court or governmental agency or third party due to CONTRACTOR Group's failure to so comply with the provisions of this Compliance with Laws section, or if the Work of CONTRACTOR, or any part thereof, is delayed or stopped by any court or governmental agency, due to CONTRACTOR Group's failure to comply with its obligations, CONTRACTOR will indemnify and hold harmless COMPANY from and against any and all fines, penalties, losses, liabilities, damages, claims, and costs (including reasonable attorneys' fees and court costs) arising out of or incurred as a result, directly or indirectly, of that failure.

 

 

  

  

  

CONFIDENTIAL AND PROPRIETARY INFORMATION

The parties ("Non-Disclosing Party") shall keep confidential and secret any and all Confidential Information disclosed to it by the other party ("Disclosing Party"), except as required by applicable law, rule or regulation; provided, however, that each Party may make such disclosures, if any, to governmental agencies and to its own agents, attorneys, auditors, accountants and shareholders as may be reasonably necessary, it being understood that if disclosure is sought through process of a court, or a state or federal regulatory agency, the Party from whom the disclosure is sought shall resist disclosure through all reasonable means and shall immediately notify the other Party to allow it the opportunity to participate in such proceedings.   "Confidential Information" shall include, but not be limited to, pricing, trade secrets, know-how, proprietary information, formulae, processes, techniques, customer information, product design and marketing activities that may be disclosed, whether orally or in writing, to Non-Disclosing Party by Disclosing Party and/or Disclosing Party's parent, subsidiary or affiliate companies, or that may be otherwise received or accessed by Non-Disclosing Party in the course of performing this Agreement.  Non-Disclosing Party expressly agrees that it (a) shall use such Confidential Information solely and exclusively in connection with the discharge of its obligations under this Agreement and (b) not disclose such Confidential Information to any other person without the Disclosing Party's prior written consent, unless: (1) the information is known to Non-Disclosing Party prior to obtaining it from Disclosing Party; (2) the information is, at the time of disclosure by Non-Disclosing Party, then in the public domain; or (3) the information is obtained by Non-Disclosing Party from a third party who did not receive it directly or indirectly from Disclosing Party and who has no obligation of secrecy with respect to that information.  Non-Disclosing Party's obligations not to disclose Confidential Information to third parties and otherwise not to use Confidential Information shall survive the termination of this Agreement. Non-Disclosing Party acknowledges that, in the event of its breach of the provisions of this section, Disclosing Party shall suffer damages that are not easily determinable, and shall be entitled to equitable relief, including, without limitation, an injunction or an order for specific performance, in addition to all other remedies available to Disclosing Party at law or in equity.

If so requested by COMPANY, CONTRACTOR further agrees to require its employees to execute a nondisclosure agreement prior to performing any services under this Agreement.

Upon written request from Disclosing Party all Confidential Information in tangible form will be, at the Disclosing Party’s discretion, either returned promptly to Disclosing Party or destroyed promptly by Receiving Party, and in either case not retained by Receiving Party in any form (and regardless of whether Receiving Party returns, destroys or retains such information, Receiving Party will continue to be bound by its obligations of confidentiality and other obligations hereunder).  The rights and obligations of the Parties under this Agreement will survive any return of Confidential Information.

 

Notwithstanding any other provision of this Agreement, CONTRACTOR’s obligations to maintain and not use or disclose Confidential Information will apply perpetually, and without limit in duration, as to any Confidential Information disclosed by COMPANY or its Affiliates which makes possible the identification of any individual customer of COMPANY or its Affiliates, by matching such information with the customer’s name, address, account number, type or classification of service, historical electricity usage, expected patterns of use, types of facilities used in providing service, individual contract terms and conditions, price, current charges, or billing records.  Notwithstanding any other provision of this Agreement to the contrary, CONTRACTOR further agrees that it and its Affiliates will protect Confidential Information consisting of proprietary customer information from disclosure as required by Public Utility Commission of Texas Substantive Rule 25.472 and will comply with the customer confidentiality provisions set forth in Rule 25.472 promulgated by the Public Utility Commission of Texas (as updated from time to time) as if CONTRACTOR were a retail electric provider (as required under Rule 25.472 because CONTRACTOR will have access to proprietary customer information of COMPANY and COMPANY is a retail electric provider).  CONTRACTOR further represents and warrants that it has read Attachment 5 to this Agreement entitled “Rule 25.472 of the Public Utility Commission of Texas.”

 

All Confidential Information that is disclosed by Disclosing Party to Receiving Party will remain property of Disclosing Party.  Nothing in this Agreement will be construed as granting a license, franchise or similar right, expressly or impliedly, for any invention, discovery or improvement made, conceived or acquired in relation to the Confidential Information or otherwise, or under any patent, trademark, copyright or other intellectual property right, except as necessary for Receiving Party’s authorized use of the Confidential Information.  Disclosing Party makes no representation or warranty with respect to any information furnished hereunder but will furnish information in good faith to the best of its knowledge and ability.  The Disclosing Party will not have any liability or responsibility for errors or omissions in, or any business decisions made by the Receiving Party in reliance on, any Confidential Information.

 

CONTRACTOR further acknowledges that it has read Attachment 4 entitled “Principles for Privacy of Customer Data” and Attachment 6 entitled “Privacy, Confidentiality and Information Security Provisions” and that it will comply with all provisions thereof with respect to Confidential Information relating to Company’s customers.

 

 

  

  

  

RIGHTS TO DATA

Any ideas, know-how, techniques, developments, designs, or data, including without limitation the equipment, software, hosting system, and IP communication techniques, which may be developed by CONTRACTOR that are not COMPANY Developed Intellectual Property as defined below (collectively, “CONTRACTOR Developed Intellectual Property”), shall be the property of CONTRACTOR, and shall not be deemed to be a work for hire for COMPANY, and CONTRACTOR shall retain ownership of and unrestricted right to use any such CONTRACTOR Developed Intellectual Property.  ***  CONTRACTOR  grants to COMPANY ***, solely for COMPANY’s use of that deliverable for ***.  The ***.

 

As a normal course of business in the software development life-cycle, CONTRACTOR will be exposed to and will be aware of ideas, concepts, drawings, diagrams and designs generated in part or whole by COMPANY.  CONTRATOR agrees that any and all ideas, concepts, drawings, diagrams and designs, created or generated by COMPANY ("COMPANY Intellectual Property") are the sole property of COMPANY, except as provided below as to Co-Developed Intellectual Property.  Any and all patent applications (whether provisional or regular), filed by either Party in the United States or elsewhere, if derived in whole or in part from COMPANY Intellectual Property will name COMPANY as an equal equity named owner.. CONTRACTOR shall have no rights to use such COMPANY Developed Intellectual Property without COMPANY’s prior written consent, except as provided below as to Co-Developed Intellectual Property. In no event may CONTRACTOR ever disclose COMPANY’s confidential and/or proprietary information and/or business processes, either directly or indirectly.

 

***

 

***

 

 

 

 

REMOVAL OF PERSONNEL

COMPANY may, at its sole discretion, and for whatever reason it deems appropriate, remove any person from performing the Work, and the person will not again be employed on the Work without the express prior written consent of COMPANY.

GOVERNING LAW

THIS AGREEMENT IS GOVERNED BY AND SHALL BE CONSTRUED IN ACCORDANCE WITH LAWS OF THE STATE OF TEXAS WITHOUT GIVING EFFECT TO ANY CHOICE OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF TEXAS OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF TEXAS.  THE PARTIES MUTUALLY CONSENT TO THE JURISDICTION OF THE FEDERAL AND STATE COURTS IN DALLAS COUNTY, TEXAS AND AGREE BECAUSE THIS AGREEMENT IS PERFORMABLE IN PART IN DALLAS COUNTY, TEXAS, THAT ANY ACTION, SUIT OR PROCEEDING CONCERNING, RELATED TO OR ARISING OUT OF THIS AGREEMENT OR THE NEGOTIATION OF THIS AGREEMENT WILL BE BROUGHT ONLY IN A FEDERAL OR STATE COURT IN DALLAS COUNTY, TEXAS AND THE PARTIES AGREE THAT THEY WILL NOT RAISE ANY DEFENSE OR OBJECTION OR FILE ANY MOTION BASED ON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE, INCONVENIENCE OF THE FORUM OR THE LIKE IN ANY CASE FILED IN A FEDERAL OR STATE COURT IN DALLAS COUNTY, TEXAS.

 

 

  

  

  

 

NON-WAIVER OF RIGHTS

A waiver by either party of any breach of this Agreement or the failure of either party to enforce any of the articles or other provisions of this Agreement will not in any way affect, limit or waive that party's right to enforce and compel strict compliance with the same or other articles or provisions.

INSURANCE

CONTRACTOR will, at its sole expense, purchase and maintain, and require their subcontractors to purchase and maintain, during the term of this Agreement, insurance policies with substantial and sound insurers, having coverage of the types and in the amounts specified in Attachment 2 to this Agreement titled “TXU Contractor’s Minimum Insurance Requirements” submitted by CONTRACTOR prior to the execution of this Agreement.

SURVIVAL

Neither the completion of any Work nor any termination or cancellation of this Agreement will relieve either Party of any obligations under this Agreement that by their nature survive the completion of the Work, including, but not limited to, Confidential and Proprietary Information, Compliance with Laws, Protection Against Liens and Encumbrances, Records and Rights to Audit, Rights to Data, Warranty, Intellectual Property, Restrictive Covenant and Indemnification clauses.

SEVERABILITY

In the event any provision of this Agreement is held to be void, unlawful or otherwise unenforceable, that provision will be severed from the remainder of the Agreement and replaced automatically by a provision containing terms as nearly like the void, unlawful, or unenforceable provision as possible; and the Agreement, as so modified, will continue to be in full force and effect.

PUBLICITY

No information relating to this Agreement will be released for publication, advertising or any other purpose without the prior written approval of COMPANY except as required by Federal Law.  CONTRACTOR is expressly prohibited from using COMPANY’s name in any publication, advertising, or promotion without COMPANY’s prior written consent.

RESTRICTIVE COVENANT

During the term of this Agreement (and, if COMPANY has fulfilled its purchase obligations under the Statement of Work, for an *** following termination of this Agreement for whatever reason), ***, or its affiliates, contractors, business partners or agents, for use by or at such other REP’s customers as part of *** within areas of the *** where *** is authorized.

The Parties acknowledge *** only to the extent necessary to protect ***.  However, the Parties hereby agree that, if the scope or enforceability of the restrictive covenant is in any way disputed at any time, a court or other trier of fact may modify and enforce the covenant to the extent that it finds the covenant to be reasonable under the circumstances then existing.

CONTRACTOR further acknowledges that: (1) in the event this Agreement is terminated for any reason, CONTRACTOR will be able to remain in business without violating the foregoing restrictions; and (2) that CONTRACTOR’s ability to remain in business without violating such restrictions is a material condition to its retention by COMPANY.

 

 

  

  

  

IMMIGRATION

All individuals employed by CONTRACTOR who perform Work under this Agreement will be employed consistent with the employment policies of the Immigration Reform and Control Act of 1986.  The failure of CONTRACTOR to follow the employment policies of the Immigration Reform and Control Act of 1986, with respect to individuals who perform Work under this Agreement, will be a breach of this Agreement.

NOTICES

All notices from one party to the other will be deemed to have been delivered if hand delivered or sent by regular United States mail, postage prepaid, as follows:

If to CONTRACTOR:

Comverge Inc.

3950 Shackleford Road, Suite 400

Duluth, GA 30096

	
Attention:

	
James Vu, Project Manager

	
  

	
(With a copy to Matthew Smith, VP and General Counsel)

If to COMPANY:

TXU Energy Retail Company LLC

6555 Sierra Drive

Irving, Texas 75039

Attn: Retail Contract Administration

With a copy to:

TXU Energy Retail Company LLC

6555 Sierra Drive

Irving, Texas 75039

Attn: Legal Department

 

 

  

  

  

REPRESENTATIVES

COMPANY's Contract Coordinator and is Patrick James, phone ***.

CONTRACTOR’s Contract Coordinator is Robert Duval, phone ***.

COMPANY's Contract Administrator is Beckie Hoyt, phone ***

 CONTRACTOR's (Comverge) Contract Adminstrator is Bert Brock, phone ***.

	
  

	
AMENDMENTS

Except as otherwise provided in this Agreement, no changes, modifications, amendments or supplements or any other provisions will be valid unless agreed to in writing and signed by the parties.

ATTACHMENTS

The following attachments are incorporated into this Agreement:

	
1.  

	
Statement of Work

	
2.  

	
TXU’s Contractor Minimum Insurance Requirement

	
3.  

	
Rule 25.474 of the Public Utility Commission of Texas

	
4.  

	
Principles for Privacy of Customer Data

	
5.  

	
Rule 25.472 of the Public Utility Commission of Texas

	
6.  

	
Privacy, Confidentiality and Information Security Provisions

ENTIRETY OF AGREEMENT

This Agreement, together with any and all attachments, constitutes the entire agreement between the parties, and all prior negotiations, undertakings, understandings and Agreements between the parties relating to the Work are merged into this Agreement.

The parties have signed this Agreement acknowledging their agreement to its provisions as of the Effective Date.

CONTRACTOR                                                                                       COMPANY

Comverge Inc.                                                                                          TXU Energy Retail Company LLC

By:           /s/ Ed Myszka                                                                           By:             /s/ Tom Leverton                                           

                Signature                                                                                                       Signature

Name:      Ed Myszka                                                                                 Name:        Tom Leverton                                                      

Title:        COO – Clean Energy Solutions Group                                  Title:           COO       

 

                                    

  

  

  

ATTACHMENT 1

STATEMENT OF WORK DOCUMENT

FOR

TXU ENERGY’S

2009 iTHERMOSTAT PROGRAM

AN INTERNET AND AMI BASED LOAD MANAGEMENT SYSTEM

WITH ZIGBEE HOME AREA NETWORK

BY AND BETWEEN

COMVERGE INC

AND

TXU ENERGY RETAIL COMPANY LLC

APRIL 15, 2009

 

 

 

 

 

  

  

  

INTRODUCTION AND BACKGROUND

CONTRACTOR will be providing hardware, software and professional services for the COMPANY iThermostat project.  The program will be targeted to have enrolled *** *** (***) by the *** in order to achieve a ***.  ***.  Regardless of geographic location all customers will be *** COMPANY customers that have high speed Internet service or have an *** provisioned meter.

This project is intended to expand the existing ***.

CONTRACTOR will provide the following program services in 2009 to support the project and are described in greater detail in the sections below.

	
1.  

	
Hardware

	
a.  

	
***

	
b.  

	
***

	
2.  

	
Software

	
a.  

	
***

	
b.  

	
***

	
c.  

	
***

	
3.  

	
Professional Services

	
a.  

	
***

COMPANY will provide ***, including ***.  COMPANY will *** and will be responsible for***. COMPANY will be ***.

 

 

 

 

 

  

  

  

	
TXU Energy iThermostat Program

	
2009 Deployment Schedule - Forecast

	
Total

	  	
Monthly

	
Cumulative

	
Month

	
# New Accounts

	
# New Thermostats

	
# New Accounts

	
# New Thermostats

	
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The pricing in this scope of work is based on the COMPANY forecasted program schedule above with the following assumptions:

	
1.  

	
COMPANY will ***, and,

	
2.  

	
CONTRACTOR will ***, COMPANY will utilizing the current stock of BASIC stats and Digi gateways thru ***.

1. HARDWARE

PROGRAMMABLE COMMUNICATING THERMOSTATS (“PCT”)

***

***

 

 

COMPANY may elect to incorporate up to two additional Smart Energy certified type of PCTs into the iThermostat program.   In such event CONTRACTOR will incorporate these additional PCTs into the iThermostat program, ***.

PCT Specifications

	
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IP GATEWAYS

CONTRACTOR will work directly with*** to ensure *** equipment will be available according to schedules at the fulfillment facility.   CONTRACTOR will also be responsible to ensure that the *** will be fully integrated and operational with the programs *** and the *** networks.

IP Gateway Specifications:

	
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*** .

2. SOFTWARE

***.

[Diagram of Service Platform]

***

LOAD MANAGEMENT SOFTWARE

CONTRACTOR represents and covenants as follows:

	
•  

	
***

	
•  

	
***

 

	
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***

	
•  

	
***

	
1.  

	
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2.  

	
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3.  

	
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4.  

	
***

 

 

  

  

  

POWERPORTAL SOFTWARE

CONTRACTOR represents and commits to the following:

	
•  

	
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Version 2

	
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*** - ***

	
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CONNECTWARE SOFTWARE

***

3. PROFESSIONAL SERVICES

SCHEDULING AND CUSTOMER CARE CALL CENTER SERVICES

***

***

***

***

***

	
1.  

	
***

	
2.  

	
***

	
3.  

	
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4.  

	
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5.  

	
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6.  

	
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7.  

	
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***

 

 

  

  

  

PERFORMANCE

***

A.      ***                                                                [***]

B.      ***                                                                [***]

C.      ***                                                                [***]

D.      ***                                                                [***]

E.      ***                                                                [***]

REPORTING

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PRICING / BUDGET

	
***Comverge Summary

	
Description

	
Pricing

	
Unit

	
# Units

	
Sub-Totals

	
1. ***

	
***

	
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***

	
2. ***

	
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3. ***

	
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4. ***

	
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5. ***

	
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6. ***

	
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7. ***

	
***

	
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***

	
8. ***

	
***

	
***

	
***

	
***

	
9. ***

	
***

	
***

	
***

	
***

	  	  	  	
***Total

	
***

***:

	
1.  

	
***

	
2.  

	
***

	
3.  

	
***

	
4.  

	
***

	
5.  

	
***

	
6.  

	
***

	
7.  

	
***

	
8.  

	
***

	
9.  

	
***

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00180-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00180-of-00352.parquet"}]]