Document:

exhibit10_3.htm

    Exhibit 10.3

     

    WARRANT
AGREEMENT

    

    THIS
WARRANT AGREEMENT, dated June 11, 2010 (this “Warrant Agreement”),
is entered into by COMVERGE,
INC., a Delaware corporation (“Comverge”);
and PROJECTS INTERNATIONAL,
INC., a District of Columbia corporation (“PI”).

    

    BACKGROUND

    

    Comverge
and PI have determined that they would benefit from a strategic alliance
arrangement between their respective organizations under which the Parties will
identify and jointly pursue opportunities for demand response, smartgrid and
energy efficiency projects in certain countries.  To that end, the
Parties have entered into a Joint Venture Master Agreement, dated as of the date
hereof (the “Master
Agreement”).   The Parties have agreed that Comverge will
issue to PI or its designated Affiliate warrants to purchase Common Stock of
Comverge from time to time, on the terms and conditions set forth in this
Warrant Agreement, based upon PI’s successful performance of its obligations
under the Master Agreement.

    

    Defined
terms used in this Warrant Agreement have the meaning specified in Exhibit
A (Defined Terms) to the Master Agreement (unless otherwise defined in
this Warrant Agreement).

     

    1. Purpose.  If PI
achieves the performance objectives set forth in this Warrant Agreement, then
Comverge will issue to PI (or its designated Affiliate) warrants to purchase
shares of Comverge common stock, at the times and for the number of shares
specified in this Warrant Agreement.  Such warrants will be in the
form attached as Exhibit
A to this Warrant Agreement and will be subject to the terms and
conditions set forth in this Warrant Agreement and in the form of warrant
attached as Exhibit
A to this Warrant Agreement.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Warrants
will be issued to PI or its designated Affiliate in tranches, for successfully
securing Eligible Contracts in the Territory pursuant to the Master Agreement,
according to formula specified in Section 6 of this Warrant
Agreement.  Each Warrant would entitle the holder to purchase shares
of Comverge common stock during the term of the Warrant, subject to the terms
and conditions of this Warrant Agreement and the Warrant.  For
purposes of this Warrant Agreement, an “Eligible Contract”
means a binding Customer Contract for a Project in the Territory which (i) has
been approved by Comverge (which approval will not be unreasonably withheld or
delayed), (ii) has received all required Governmental Authority and regulatory
approvals, and (iii) is not subject to any conditions to its
effectiveness.

     

    2. Shares of Comverge Stock Subject to
Warrants.  Comverge will issue Warrants to purchase up to a
maximum aggregate of 1,200,000 shares of Comverge common stock, recalculated for
any stock split(s) occurring after the Effective Date of the Master
Agreement.

     

     

    3. Warrant Exercise
Price.  The exercise price under each Warrant shall be equal to
$16.24.

     

     

    4. Warrant
Tranches.  Warrants will be earned and issued in increments of
120,000 shares upon the attainment of the appropriate threshold, as described in
Section 6 of this Warrant Agreement.

     

     

    5. Minimum Performance
Metric.  Warrants will be earned by PI if PI is successful
during the first three (3) years of the Master Agreement in securing a
Qualifying Contract resulting in a minimum of 100 Megawatts of delivered load
reduction over the term of the Qualifying Contract (the “Minimum Performance
Metric”).

     

     

    6. Formula For Awarding Additional
Warrants Above the Minimum Performance Metric.  Pursuant to the
table below, Warrants will be earned by PI if PI is successful in securing
Qualifying Contracts in increments of 120,000 shares for every 100 Megawatts of
delivered load reduction contracts, in aggregate, above the Minimum Performance
Metric.  Warrants are earned at the rate of 1,200 shares for every one
(1) Megawatt of delivered load reduction in Qualifying Contracts, in aggregate,
above the Minimum Performance Metric.  Warrants earned hereunder will
be fully vested when issued.

     

    

    
      	 
      	 
      	
            
	
               

              Warrant
      Tranche

            	
               

              Shares
      Earned

            	
                    
                Cumulative
      Performance Metric Attained
Aggregate Megawatts of Project
      Contracts

            
	 
      	
              0

            	
              <
      100

            
	
              1

            	
              120,000

            	
              100

            
	
              2

            	
              120,000

            	
              200

            
	
              3

            	
              120,000

            	
              300

            
	
              4

            	
              120,000

            	
              400

            
	
              5

            	
              120,000

            	
              500

            
	
              6

            	
              120,000

            	
              600

            
	
              7

            	
              120,000

            	
              700

            
	
              8

            	
              120,000

            	
              800

            
	
              9

            	
              120,000

            	
              900

            
	
              10

            	
              120,000

            	
              1000

            
	
              Total

            	
              1,200,000

            	
              1000

            

    

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    7. Warrant
Vesting.  Warrants will be earned and issued each time that a
new threshold has been reached on a cumulative basis.  For example,
assume that PI has previously delivered Qualifying Contracts with a cumulative
425 Megawatts of delivered load reduction.  At that point, PI would
have been issued Warrants for an aggregate of 480,000 shares of Common Stock
(Tranche 4).  If PI then delivers a new Qualifying Contract with 150
Megawatts of delivered load reduction (for a cumulative total of 575 Megawatts),
Comverge would issue an additional Warrant for 120,000
shares.  Qualifying Contracts must be entered into on or before the
fifth (5th)
anniversary of the Effective Date of the Master Agreement in order to qualify
under this Warrant Agreement.  Warrants earned hereunder will be fully
vested when issued.

     

     

    8. Warrant
Term.  Warrants will be exercisable for up to five (5) years
from the Effective Date of the Master Agreement.

     

     

    9. Transferability.  Warrants
will be non-transferable except to PI’s designated Affiliate.

     

     

    10. Partial Warrant Issuance.
While the Warrants are issued in tranches of 120,000 shares, on two (2)
occasions over the five (5) year term, PI may request a partial issuance of
Warrants for pro-rata Warrants earned above one Warrant tranche, but below the
next Warrant tranche.  In the example in Section 7 above, PI could
request that Comverge issue a Warrant for 75 Megawatts (the excess above the
prior tranche of 500 Megawatts).  If so requested, Comverge would
issue a Warrant for 90,000 shares (1,200 shares x 75 Megawatts).  Such
partial issuance of Warrants will automatically reduce the next earned Warrant
tranche of 120,000 shares.  Further, at the end of the five (5) year
Warrant vesting term, Comverge will issue Warrants for any partial tranche
earned at the end of the Warrant vesting term, at the rate of 1,200 shares per
Megawatt of Qualifying Contracts.

     

     

    11. No Registration Rights. The
Warrants, and any shares acquired upon exercise of Warrants, will be issued
pursuant to appropriate federal and state securities laws exemptions, and
Comverge will have no obligation to register the Warrants or any shares acquired
upon exercise of the Warrants.

     

     

    12. Termination.  The
obligation to issue Warrants will terminate upon the fifth anniversary of the
Effective Date of the Master Agreement or such earlier date specified in the
Master Agreement.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    13. Exercise of Option
Rights.

     

     

    (a) If
Comverge exercises its rights under Section 12 of the Master Agreement, then the
obligation of Comverge to issue any additional Warrants under this Warrant
Agreement will terminate.

     

     

    (b) If either
Party exercises its option rights under Section 13 of the Master Agreement, then
the obligation of Comverge to issue any additional Warrants under this Warrant
Agreement will terminate.

     

     

    14. Notices.  All
notices, certificates, acknowledgements, reports, and other communications to a
Party under this Warrant Agreement must be in writing and will be deemed duly
delivered upon receipt at the address for such party as follows, or to such
other address as such party may, by written notice provided in accordance with
this Section designate to the other.

     

    A.           Comverge,
Inc.

    5390
Triangle Parkway

    Suite
300

    Norcross,
Georgia 30092

    Attention:  Chief
Financial Officer

    

    with a
copy to :

    

    5390
Triangle Parkway

    Suite
300

    Norcross,
Georgia 30092

    Attention:  General
Counsel

    

    and

    

    King
& Spalding LLP

    1180
Peachtree Street

    Atlanta,
Georgia 30309

    Attention:
William G. Roche

    

    B.           Projects
International, Inc.

    888
17th
Street NW

    Suite
1250

    Washington,
D.C. 20006

    Attention:
Chief Financial Officer

     

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    15. Assignment.  This
Warrant Agreement may not be assigned or otherwise transferred by PI in whole or
in part, without the express prior written consent of Comverge.

     

     

    16. Amendment and
Waiver.  This Warrant Agreement may not be amended or modified,
nor will any waiver of any right under this Warrant Agreement be effective,
unless set forth in a document executed by duly authorized representative(s) of
all Parties.  The waiver of any breach of any term, covenant, or
condition in this Warrant Agreement will not be deemed to be a waiver of such
term, covenant, or condition for any subsequent breach of the same.

     

     

    17. Entire
Agreement.  This Warrant Agreement, the Warrants issued in the
form attached as Exhibit A to this Warrant Agreement, together with the Master
Agreement and its exhibits, contain all of the agreements, representations, and
understandings of the Parties and supersede and replaces any and all previous
understandings, commitments, or agreements, oral or written, related to the
subject matter hereof and thereof.

     

     

    18. Governing Law.  This
Warrant Agreement and its enforcement will be governed by, and interpreted in
accordance with, the laws of the State of Delaware, without regard to
conflict-of-law principles.

     

     

    19. Consent to
Jurisdiction.  Each party hereby irrevocably agrees that any
legal dispute with respect to this warrant agreement shall be brought only to
the exclusive jurisdiction of the courts of the State of Delaware or the federal
courts located in the State of Delaware, and each party hereby consents to the
jurisdiction of such courts (and of the appropriate appellate courts therefrom)
in any such suit, action or proceeding and irrevocably waives, to the fullest
extent permitted by law, any objection that it may now or hereafter have to the
laying of the venue of any such suit, action or proceeding in any such court or
that they any such suit, action or proceeding that is brought in any such court
has been brought in an inconvenient forum.  During the period a legal
dispute that is filed in accordance with this section is pending before a
court, all actions, suits or proceedings with respect to such legal dispute or
any other legal dispute, including any counterclaim, cross-claim or
interpleader, shall be subject to the exclusive jurisdiction of such
court.  Each party hereby waives, and shall not assert as a defense in
any legal dispute, that (a) such party is not subject thereto,
(b) such action, suit or proceeding may not be brought or is not
maintainable in such court, (c) such party’s property is exempt or immune
from execution, (d) such action, suit or proceeding is brought in an
inconvenient forum, or (e) the venue of such action, suit or proceeding is
improper.  A final judgment in any action, suit or proceeding
described in this section following the expiration of any period permitted for
appeal and subject to any stay during appeal shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by applicable laws.

     

     

    20. Costs and
Expenses.  Each Party will bear all costs and expenses incurred
in connection with the preparation, negotiation and execution of this Warrant
Agreement and the issuance and exercise of the Warrants.

     

    

    [Remainder
of page left intentionally blank.  Signature Page
follows.]

     

     

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, the
Parties have executed this Warrant Agreement the day and the year of the latest
date specified below:

    

    COMVERGE,
INC.

    

    

    By:           /s/ Michael
Picchi

    Name:  Michael
Picchi

    Title:    EVP-CFO

    

    Date:    June 11,
2010

    

    

    

    PROJECTS
INTERNATIONAL, INC.

    

    

    By:           /s/ Peter
Young

    Name:  Peter
Young

    Title:    President

    

    Date:    6/11/2010

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    EXHIBIT
A

    FORM
OF WARRANT

    

    [Attached]

    

     

     

     

     

     

     

     

     

     

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE
SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
LAWS.  THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED
OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR
THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION
OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT.

    

    COMVERGE,
INC.

    

    Warrant
To Purchase Common Stock

    

    Warrant
No.: ____

    Number of
Shares of Common Stock:  _______

    Date of
Issuance:  _______

    

    COMVERGE, INC., a Delaware
corporation (the “Company”), hereby certifies
that, for good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, PROJECTS INTERNATIONAL, INC., the registered holder
hereof or its permitted assigns (the “Holder”), is entitled, subject
to the terms set forth below, to purchase from the Company, at the Exercise
Price then in effect, upon surrender of this Warrant to Purchase Common Stock
(including any Warrants to Purchase Common Stock issued in exchange, transfer or
replacement hereof, the “Warrant”), at any time or
times on or after the Issuance Date, but not after 11:59 p.m., New York Time, on
the Expiration Date, ___________ fully paid and nonassessable shares of the
Company’s Common Stock, free from all liens and
charges with respect to the issuance thereof.  Capitalized terms used
in this Warrant have the meanings set forth in Section 16.

     

    1. EXERCISE OF
WARRANT.

     

    (a) Mechanics of
Exercise.  Subject to the terms and conditions of this Warrant,
this Warrant may be exercised by the Holder on any day on or after the Issuance
Date and prior to the Expiration Date, in whole or in part, by delivery of a
written notice, in the form attached as Exhibit A (the “Exercise Notice”), of the
Holder’s election to exercise this Warrant, and (ii) (A) payment to the
Company of an amount equal to the applicable Exercise Price multiplied by the
number of Warrant Shares as to which this Warrant is being exercised (the “Aggregate Exercise Price”) in
cash or wire transfer of immediately available funds, or (B) by notifying the
Company that this Warrant is being exercised pursuant to a Cashless
Exercise.  The Holder shall not be required to deliver the original
Warrant in order to effect an exercise hereunder.  Execution and
delivery of the Exercise Notice with respect to less than all of the Warrant
Shares shall have the same effect as cancellation of the original Warrant and
issuance of a new Warrant evidencing the right to purchase the remaining number
of Warrant Shares.  On or before the first (1st)
Business Day following the date on which the Company has received each of the
Exercise Notice and the Aggregate Exercise Price (or notice of a Cashless
Exercise) (the “Exercise
Delivery Documents”), the Company shall transmit by facsimile an
acknowledgment of confirmation of receipt of the Exercise Delivery Documents to
the Holder and the Company’s Transfer Agent.  On or before the third
(3rd)
Business Day following the date on which the Company has received all of the
Exercise Delivery Documents, the Company shall (X) provided that the Transfer
Agent is participating in the DTC Fast Automated Securities Transfer Program,
upon the request of the Holder, credit such aggregate number of shares of Common
Stock to which the Holder is entitled pursuant to such exercise to the Holder’s
or its designee’s balance account with DTC through its Deposit Withdrawal Agent
Commission system, or (Y) if the Transfer Agent is not participating in the DTC
Fast Automated Securities Transfer Program, issue and dispatch by overnight
courier to the address specified in the Exercise Notice, a certificate,
registered in the Company’s share register in the name of the Holder or its
designee, for the number of shares of Common Stock to which the Holder is
entitled pursuant to such exercise.  If this Warrant is submitted in
connection with any exercise pursuant to this Section 1(a) and the number of
Warrant Shares represented by this Warrant submitted for exercise is greater
than the number of Warrant Shares being acquired upon an exercise, then the
Company shall as soon as practicable and in no event later than three Business
Days after any exercise, and at the Company’s expense, issue a new Warrant (in
accordance with Section 7(d)) representing the right to purchase the number of
Warrant Shares purchasable immediately prior to such exercise under this
Warrant, less the number of Warrant Shares with respect to which this Warrant is
exercised.  No fractional shares of Common Stock are to be issued upon
the exercise of this Warrant, but rather the number of shares of Common Stock to
be issued shall be rounded up to the nearest whole number.  The
Company shall pay any and all taxes which may be payable with respect to the
issuance and delivery of Warrant Shares upon exercise of this
Warrant.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (b) Exercise
Price.  For purposes of this Warrant, “Exercise Price” means
$____, subject to
adjustment as provided in Section 2.

     

    (c) Cashless
Exercise.  The Holder may, in its sole discretion, exercise
this Warrant in whole or in part and, in lieu of making the cash payment
otherwise contemplated to be made to the Company upon such exercise in payment
of the Aggregate Exercise Price, elect instead to receive upon such exercise the
“Net Number” of shares
of Common Stock determined according to the following formula (a “Cashless
Exercise”):

     

    Net Number = (A x B) - (A x
C)

    

    

    

    For purposes of the foregoing
formula:

     

    A = the
total number of shares with respect to which this Warrant is then being
exercised.

     

    B = the
Weighted Average Price of the shares of Common Stock (as reported by Bloomberg)
for the five (5) consecutive Trading Days ending on the date immediately
preceding the date of the Exercise Notice.

     

    C = the
Exercise Price then in effect for the applicable Warrant Shares at the time of
such exercise.

    

    (d) Disputes.  In
the case of a dispute as to the determination of the Exercise Price or the
arithmetic calculation of the Warrant Shares, the Company shall promptly issue
to the Holder the number of Warrant Shares that are not disputed and resolve
such dispute in accordance with Section 12.

     

    (e) Insufficient Authorized
Shares.  If at any time while this Warrant remains outstanding
the Company does not have a sufficient number of authorized and unreserved
shares of Common Stock to satisfy its obligation to reserve for issuance upon
exercise of this Warrant at least a number of shares of Common Stock equal to
100% (the “Required Reserve
Amount”) of the number of shares of Common Stock as shall from time to
time be necessary to effect the exercise of all of this Warrant then outstanding
(an “Authorized Share
Failure”), then the Company shall immediately take all action necessary
to increase the Company’s authorized shares of Common Stock to an amount
sufficient to allow the Company to reserve the Required Reserve Amount for this
Warrant then outstanding.  As soon as practicable after the date of
the occurrence of an Authorized Share Failure, but in no event later than one
hundred and eighty (180) days after the occurrence of such Authorized Share
Failure, the Company shall hold a meeting of its stockholders for the approval
of an increase in the number of authorized shares of Common Stock.  In
connection with such meeting, the Company shall provide each stockholder with a
proxy statement and shall use its reasonable efforts to solicit its
stockholders’ approval of such increase in authorized shares of Common Stock and
to cause the Company’s board of directors to recommend to the stockholders that
they approve such proposal.

     

    2. ADJUSTMENT OF EXERCISE PRICE
AND NUMBER OF WARRANT SHARES.   If the Company at any time
on or after the Issuance Date subdivides (by any stock split, stock dividend,
recapitalization or otherwise) one or more classes of its outstanding shares of
Common Stock into a greater number of shares, then the Exercise Price in effect
immediately prior to such subdivision will be proportionately reduced, and the
number of Warrant Shares will be proportionately increased.  If the
Company at any time on or after the Issuance Date combines (by combination,
reverse stock split or otherwise) one or more classes of its outstanding shares
of Common Stock into a smaller number of shares, then the Exercise Price in
effect immediately prior to such combination will be proportionately increased,
and the number of Warrant Shares will be proportionately
decreased.  Any adjustment under this Section 2 shall become effective
at the close of business on the date the subdivision or combination becomes
effective.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    3. RIGHTS UPON DISTRIBUTION OF
ASSETS.  If the Company distributes to all holders of Common
Stock  assets (other than cash dividends or cash distributions payable
out of consolidated earnings or earned surplus or share dividends or
distributions resulting in an adjustment under Section 2), then the Exercise
Price to be in effect after such distribution shall be determined by multiplying
the Exercise Price in effect immediately prior to such distribution by a
fraction, the numerator of which shall be the total number of shares of Common
Stock outstanding multiplied by the Weighted Average Price per share of Common
Stock immediately prior to such distribution, less the fair market value (as
determined by the Company’s Board of Directors in good faith) of the assets so
distributed, and the denominator of which shall be the total number of shares of
Common Stock outstanding multiplied by such Weighted Average Price per share of
Common Stock immediately prior to such distribution.  Such adjustment
shall be made successively whenever such a distribution is made.

     

    4. FUNDAMENTAL
TRANSACTIONS.  If the Company enters into, is a party to, or is
subject to a Fundamental Transaction, then the Company will provide written
notice of such Fundamental Transaction at least ten (10) Business Days prior to
the consummation of such Fundamental Transaction.  The Holder must
exercise any unexercised portion of this Warrant at least two (2) Business Days
prior to the consummation of the Fundamental
Transaction.  Notwithstanding any other provisions of this Warrant,
this Warrant will expire upon the consummation of a Fundamental Transaction, to
the extent not duly exercised in accordance with the preceding sentence and the
provisions of Section 1(a) of this Warrant.

     

    5. NONCIRCUMVENTION.  The
Company hereby covenants and agrees that the Company will not, by amendment of
its Certificate of Incorporation, Bylaws 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, and will at all times in good faith carry
out all the provisions of this Warrant.  Without limiting the
generality of the foregoing, the Company (i) shall not increase the par
value of any shares of Common Stock receivable upon the exercise of this Warrant
above the Exercise Price then in effect, and (ii) shall take all such
actions as may be necessary or appropriate in order that the Company may validly
and legally issue fully paid and nonassessable shares of Common Stock upon the
exercise of this Warrant.

     

    6. WARRANT HOLDER NOT DEEMED A
STOCKHOLDER.  The Holder, solely in such Person’s capacity as a
holder of this Warrant, shall not be entitled to vote or receive dividends or be
deemed the holder of share capital of the Company for any purpose, nor shall
anything contained in this Warrant be construed to confer upon the Holder,
solely in such Person’s capacity as the Holder of this Warrant, any of the
rights of a stockholder of the Company or any right to vote, give or withhold
consent to any corporate action (whether any reorganization, issue of stock,
reclassification of stock, consolidation, merger, conveyance or otherwise),
receive notice of meetings, receive dividends or subscription rights, or
otherwise, prior to the issuance to the Holder of the Warrant Shares which
Holder is then entitled to receive upon the due exercise of this
Warrant.  In addition, nothing contained in this Warrant shall be
construed as imposing any liabilities on the Holder to purchase any securities
(upon exercise of this Warrant or otherwise) or as a stockholder of the Company,
whether such liabilities are asserted by the Company or by creditors of the
Company.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    7. REISSUANCE OF
WARRANTS.

     

    (a) Transfer of
Warrant.  If this Warrant is to be transferred, the Holder
shall surrender this Warrant to the Company, whereupon the Company will (subject
to Section 15) issue and deliver upon the order of the Holder a new Warrant (in
accordance with Section 7(d)), registered as the Holder may request,
representing the right to purchase the number of Warrant Shares being
transferred by the Holder and, if less than the total number of Warrant Shares
then underlying this Warrant is being transferred, a new Warrant (in accordance
with Section 7(d)) to the Holder representing the right to purchase the number
of Warrant Shares not being transferred.

     

    (b) Lost, Stolen or Mutilated
Warrant.  Upon receipt by the Company of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant, and, in the case of loss, theft or destruction, of any
indemnification undertaking by the Holder to the Company in customary form and,
in the case of mutilation, upon surrender and cancellation of this Warrant, the
Company shall execute and deliver to the Holder a new Warrant (in accordance
with Section 7(d)) representing the right to purchase the Warrant Shares then
underlying this Warrant.

     

    (c) Exchangeable for Multiple
Warrants.  This Warrant is exchangeable, upon the surrender
hereof by the Holder at the principal office of the Company, for a new Warrant
or Warrants (in accordance with Section 7(d)) representing in the aggregate the
right to purchase the number of Warrant Shares then underlying this Warrant, and
each such new Warrant will represent the right to purchase such portion of such
Warrant Shares as is designated by the Holder at the time of such surrender;
provided, however, that no Warrants for fractional shares of Common Stock shall
be issued.

     

    (d) Issuance of New
Warrants.  Whenever the Company is required to issue a new
Warrant pursuant to the terms of this Warrant, such new Warrant (i) shall be of
like tenor with this Warrant, (ii) shall represent, as indicated on the face of
such new Warrant, the right to purchase the Warrant Shares then underlying this
Warrant (or in the case of a new Warrant being issued pursuant to Section 7(a)
or Section 7(c), the Warrant Shares designated by the Holder which, when added
to the number of shares of Common Stock underlying the other new Warrants issued
in connection with such issuance, does not exceed the number of Warrant Shares
then underlying this Warrant), (iii) shall have an issuance date, as indicated
on the face of such new Warrant which is the same as the Issuance Date, and (iv)
shall have the same rights and be subject to the same terms and conditions as
this Warrant.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    8. SHARE
LEGEND.  The share certificates for the Warrant Shares issued
upon exercise of this Warrant will bear the following legend:

     

    THE
ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE
STATE SECURITIES LAWS.  THE SECURITIES MAY NOT BE OFFERED FOR SALE,
SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR (B) AN OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT
REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE
144 OR RULE 144A UNDER SAID ACT.

    

    9. NOTICES.  Whenever
notice is required or permitted to be given under this Warrant, such notice must
be in writing and must given or delivered by one of the following methods of
delivery: (i) personal delivery, (ii) Registered or Certified Mail (in each
case, return receipt requested and postage prepaid), or (iii) by nationally
recognized overnight courier, with all fees prepaid.

     

    In the case of notice to the Company,
such notice must be delivered to the following address:

    

    Comverge, Inc.

    5390
Triangle Parkway

    Suite
300

    Norcross,
Georgia 30092

    Attention:  Chief
Financial Officer

    

    

    with a copy to:

    

    5390
Triangle Parkway

    Suite
300

    Norcross,
Georgia 30092

    Attention:  General
Counsel

    

    and

    

    King
& Spalding LLP

    1180
Peachtree Street

    Atlanta,
Georgia 30309

    Attention:
William G. Roche

    

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    

    In the case of notice to the Holder,
such notice must be delivered to the following address:

    

    Projects International,
Inc.

    888
17th
Street NW

    Suite
1250

    Washington,
D.C. 20006

    Attention:
Chief Financial Officer

    

    The Company will provide the Holder
with prompt written notice of all actions taken pursuant to this Warrant,
including in reasonable detail a description of such action and the reason
therefore.  Without limiting the generality of the foregoing, the
Company will give written notice to the Holder (i) upon any adjustment of the
Exercise Price, setting forth in reasonable detail, and certifying, the
calculation of such adjustment, and (ii) at least ten (10) days prior to the
date on which the Company closes its books or takes a record with respect to any
dividend or distribution upon the shares of Common Stock.

    

    Notice delivered in accordance with
this Section will be effective upon receipt.

    

    10. AMENDMENT AND
WAIVER.  The provisions of this Warrant may be amended and the
Company may take any action herein prohibited, or omit to perform any act herein
required to be performed by it, only if the Company and Holder have agreed in
writing to such amendment, act or omission.

     

    11. GOVERNING LAW AND
FORUM.  This Warrant shall be governed by and construed and
enforced in accor­dance with, and all questions concerning the construction,
validity, interpretation and performance of this Warrant shall be governed by,
the internal laws of the State of Delaware.  The parties hereto agree
to submit to the exclusive jurisdiction of the federal and state courts of the
State of Delaware with respect to the interpretation of this Warrant or for the
purposes of any action arising out of or related to this Warrant.

     

    12. CONSTRUCTION;
HEADINGS.  This Warrant shall be deemed to be jointly drafted
by the Company and Holder and shall not be construed against any person as the
drafter hereof.  The headings of this Warrant are for convenience of
reference and shall not form part of, or affect the interpretation of, this
Warrant.  As used in this Warrant, “including” means in each instance,
“including, without limitation.”

     

    13. DISPUTE
RESOLUTION.  In the case of a dispute as to the determination
of the Exercise Price or the arithmetic calculation of the Warrant Shares, the
Company shall submit the disputed determinations or arithmetic calculations via
facsimile within two (2) Business Days of receipt of the Exercise Notice giving
rise to such dispute, as the case may be, to the Holder.  If the
Holder and the Company are unable to agree upon such determination or
calculation of the Exercise Price or the Warrant Shares within three Business
Days of such disputed determination or arithmetic calculation being submitted to
the Holder, then the Company shall, within two (2) Business Days, submit via
facsimile the disputed determination or calculation of the Exercise Price or the
Warrant Shares to an independent, reputable investment bank selected by the
Company and approved by the Holder.  The Company shall cause at its
expense the investment bank to perform the determinations or calculations and
notify the Company and the Holder of the results no later than ten (10) Business
Days from the time it receives the disputed determinations or
calculations.  Such investment bank’s determination or calculation, as
the case may be, shall be binding upon all parties absent demonstrable
error.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    14. REMEDIES, OTHER
OBLIGATIONS.  The remedies provided in this Warrant shall be
cumulative and in addition to all other remedies available under this Warrant,
at law or in equity (including a decree of specific performance and/or other
injunctive relief), and nothing herein shall limit the right of the Holder to
pursue actual damages for any failure by the Company to comply with the terms of
this Warrant.

     

    15. TRANSFER.                      This
Warrant may not be offered for sale, sold, transferred or assigned without the
prior written consent of the Company, except that Holder may transfer all or
part of this Warrant to an Affiliate of Projects International, LLC without the
prior consent of the Company.  This Warrant is a “restricted security”
as such term is defined in Rule 144 promulgated under the Securities Act and
must be held indefinitely unless transferred pursuant to an exemption from
registration or qualification under applicable state and federal securities
laws.

     

    16. CERTAIN
DEFINITIONS.  For purposes of this Warrant, the following terms
have the following meanings:

     

    (a) “Affiliate” means, as to any
Person, a Person that controls, is controlled by, or is under common control
with such Person.  For this purpose, “control” means the ownership,
directly or indirectly, of more than 50% of the voting securities of a
Person.

     

    (b) “Aggregate Exercise Price” has
the meaning specified in Section 1(a).

     

    (c) “Authorized Share Failure” has
the meaning specified in Section 1(e).

     

    (d) “Bloomberg” means Bloomberg
Financial Markets.

     

    (e) “Business Day” means any day
other than Saturday, Sunday or other day on which commercial banks in The City
of New York are authorized or required by law to remain closed.

     

    (f) “Cashless Exercise” has the
meaning specified in Section 1(c).

     

    (g) “Common Stock” means
(i) the Company’s Common Stock, $0.001 par value, and (ii) any share
capital into which such Common Stock has been changed or any share capital
resulting from a reclassification of such Common Stock.

     

    (h) “Company” means Comverge, Inc.,
a Delaware corporation.

     

    (i) “DTC” means The Depository
Trust Company.

     

    (j) “Exercise Delivery Documents”
has the meaning specified in Section 1(a).

     

    (k) “Exercise Notice” has the
meaning specified in Section 1(a).

     

    (l) “Exercise Price” has the
meaning specified in Section 1(b).

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (m) “Expiration Date” means
________________, 2015 [i.e., the date
sixty (60) months after the date on which the Joint Venture Master Agreement is
executed] or, if such date falls on a day other than a Trading Day, the
next Trading Day.

     

    (n) “Fundamental Transaction” means
that the Company, directly or indirectly, in one or more related transactions,
(i) consolidates or merges with or into (whether or not the Company is the
surviving corporation) another Person, or (ii) sells, assigns, transfers,
conveys or otherwise disposes of all or substantially all of the properties or
assets of the Company to another Person, or (iii) allows another Person to make
a purchase, tender or exchange offer that is accepted by the holders of more
than 50% of either the outstanding shares of Common Stock (not including any
shares of Common Stock held by the Person or Persons making or party to, or
associated or affiliated with the Persons making or party to, such purchase,
tender or exchange offer), or (iv) consummates a stock purchase agreement or
other business combination (including a reorganization or recapitalization) with
another Person whereby such other Person acquires more than 50% of the
outstanding shares of Common Stock (not including any shares of Common Stock
held by the other Person or other Persons making or party to, or associated or
affiliated with the other Persons making or party to, such stock purchase
agreement or other business combination), or (v) reorganizes, recapitalizes or
reclassifies its Common Stock, or (vi) any “person” or “group” (as these terms
are used for purposes of Sections 13(d) and 14(d) of the Exchange Act) is or
becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of more than 50% of the outstanding shares of
Common Stock.

     

    (o) “Holder” means Projects
International, Inc. or its permitted assigns.

     

    (p) “Issuance Date” means
__________. [i.e., the date on
which the Warrant is issued in accordance with the terms of the Warrant
Agreement.]

     

    (q) “Net Number” has the meaning
specified in Section 1(c).

     

    (r) “Person” means an individual, a
limited liability company, a partnership, a joint venture, a corporation, a
trust, an unincorporated organization, any other entity and a government or any
department or agency thereof.

     

    (s) “Principal Market” means The
NASDAQ Global Market.

     

    (t) “Required Reserve Amount” has
the meaning specified in Section 1(e).

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (u) “Trading Day” means any day on
which the Common Stock is traded on the Principal Market, or, if the Principal
Market is not the principal trading market for the Common Stock, then on the
principal securities exchange or securities market on which the Common Stock is
then traded; provided that “Trading Day” will not include any day on which the
Common Stock is scheduled to trade on such exchange or market for less than 4.5
hours or any day that the Common Stock is suspended from trading during the
final hour of trading on such exchange or market (or if such exchange or market
does not designate in advance the closing time of trading on such exchange or
market, then during the hour ending at 4:00 p.m., New York Time).

     

    (v) “Transfer Agent” means the
Company’s stock transfer agent.

     

    (w) “Warrant” means this Warrant to
Purchase Common Stock and any Warrant issued in exchange, transfer or
replacement thereof in accordance with Section 7.

     

    (x) “Warrant Shares” means the
shares of Common Stock for which this Warrant may be exercised in accordance
with the terms hereof.

     

    (y) “Weighted Average Price” means,
for any security as of any date, the dollar volume-weighted average price for
such security on the Principal Market during the period beginning at 9:30 a.m.,
New York City time, and ending at 4:00 p.m., New York City time, as reported by
Bloomberg through its “Volume at Price” function or, if the foregoing does not
apply, the dollar volume-weighted average price of such security in the
over-the-counter market on the electronic bulletin board for such security
during the period beginning at 9:30 a.m., New York City time, and ending at 4:00
p.m., New York City time, as reported by Bloomberg, or, if no dollar
volume-weighted average price is reported for such security by Bloomberg for
such hours, the average of the highest closing bid price and the lowest closing
ask price of any of the market makers for such security as reported in the “pink
sheets” by Pink Sheets LLC.  If the Weighted Average Price cannot be
calculated for such security on such date on any of the foregoing bases, the
Weighted Average Price of such security on such date will be the fair market
value as mutually determined by the Company and the Holder.  If the
Company and the Holder are unable to agree upon the fair market value of the
such security, then such dispute will be resolved pursuant to Section 13, with
the term “Weighted Average Price” being substituted for the term “Exercise
Price.” All such determinations will be appropriately adjusted for any share
dividend, share split or other similar transaction during such
period.

     

    IN WITNESS WHEREOF, the
Company has caused this Warrant to Purchase Common Stock to be duly executed as
of the Issuance Date set out above.

    

    

    
      	
               
      

            	
              COMVERGE,
      INC.

            

    

    

    

    By:                                                                                     

          Name:

          Title:

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    EXHIBIT
A

    

    EXERCISE
NOTICE

    TO
BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS

    WARRANT
TO PURCHASE COMMON STOCK

    

    COMVERGE,
INC.

    The undersigned holder hereby exercises
the right to purchase _________________ of the shares of Common Stock (“Warrant Shares”) of Comverge,
Inc., a Delaware corporation (the “Company”), evidenced by the
attached Warrant to Purchase Common Stock (the “Warrant”).  Capitalized
terms used herein and not otherwise defined have the respective meanings set
forth in the Warrant.

    

    1.  Form of Exercise
Price.  The Holder intends that payment of the Exercise Price
shall be made as:

    

    
      	
               
      

            	
              ____________

            	
              a
      “Cash
      Exercise” with respect to _________________

            	
              Warrant
      Shares; and/or

            

    

    

    
      	
               
      

            	
              ____________

            	
              a
      “Cashless
      Exercise” with respect to _______________

            	
              Warrant
      Shares.

            

    

    

    2.  Payment of Exercise
Price.  If the Holder has elected a Cash Exercise with respect
to some or all of the Warrant Shares to be issued pursuant hereto, the Holder
shall pay the Aggregate Exercise Price in the sum of $___________________ to the
Company in accordance with the terms of the Warrant.

    

    3.  Delivery of Warrant
Shares.  The Company shall deliver to the Holder __________
Warrant Shares in accordance with the terms of the Warrant.

    

    Date:
_______________ __, ______

    

    

    

    Name of
Registered Holder

    

    

    By:           

    Name:

    Title:

     

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    ACKNOWLEDGMENT

    

    

    The Company hereby acknowledges this
Exercise Notice and hereby directs American Stock Transfer & Trust Company
to issue the above indicated number of shares of Common Stock in accordance with
the Transfer Agent Instructions dated _______________ from the Company and
acknowledged and agreed to by American Stock Transfer & Trust
Company.

    

    COMVERGE, INC.

    

    

    

    By:                                                                                     

          Name:

          Title:exhibit10_4.htm

    Exhibit 10.4

    

     

    COMVERGE,
INC.

     

    EXECUTIVE EMPLOYMENT
AGREEMENT

     

    THIS
EXECUTIVE EMPLOYMENT AGREEMENT (this “Agreement”) is entered into on June 21,
2010 (“Effective Date”), by and between Christopher Camino, an individual
(“Executive”), and Comverge, Inc., a Delaware corporation (the
“Company”).   The Executive and Company are collectively referred
to as “Parties” and individually as “Party”.

     

    WHEREAS,
the Company wishes to employ Executive to
provide personal services to the Company and wishes to provide Executive with
certain compensation and benefits in return for such services;

     

    WHEREAS,
the Executive and Company now wish to enter the current Agreement;
and

     

    WHEREAS,
Executive wishes to be employed by the Company, and to provide personal services
to the Company in return for certain compensation and benefits.

     

    NOW,
THEREFORE, in consideration of the mutual promises and covenants contained
herein, the Executive and the Company hereby agree as follows:

     

    
      	
              SECTION
      1.  

            	
              EMPLOYMENT
      BY THE COMPANY.

            

    

     

    1.1 Employment
Agreement.  Upon the Effective
Date of this Agreement (the
“Employment Date”), Executive’s employment
with the Company shall be pursuant to the terms stated
herein.

     

    1.2 Position and
Duties.  Executive
shall serve in the position of Executive Vice-President of Sales, Chief
Marketing Officer, with such powers, duties, and/or responsibilities as are
assigned to Executive by the President & Chief Executive Officer, or his/her
respective delegate.  Executive will devote his best efforts, time,
and attention exclusively to the business of the Company, and shall faithfully
and efficiently discharge all duties and responsibilities assigned to him
hereunder.  Executive shall comply with
all Company policies, procedures and practices as may now exist or which from
time to time be implemented.

    
      1.3 Location.  Executive’s
primary office location shall be in Pittsburgh, Pennsylvania. Executive acknowledges that he will be required to spend
time in Atlanta, Georgia and that the Company’s business extends across the
entire North America and elsewhere and that, from time to
time,  Executive’s duties will require him to travel and to work at
other locations, including but not limited
to other Company office locations.

      
        1.4 Term.  The
term of Executive’s employment hereunder shall commence as of the Employment
Date and shall continue through December 31, 2011, unless earlier terminated
pursuant to the provisions of this Agreement.  Unless, within ninety
(90) days prior to any then-scheduled expiration of the Term, either party
notifies the other in writing of its desire not to renew this Agreement, the
Term shall automatically be extended for an additional period of one (1) year
from the applicable succeeding anniversary of the Employment Date.

         

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        1.5 No
Restrictions.  Executive acknowledges that the Company is entering
into this Agreement based on Executive’s representation that as of the date of
execution of this Agreement, Executive is not subject to any agreement,
including but not limited to a non-compete, restrictive covenant or
non-disclosure agreement, that would prevent or materially restrict Executive
from performing the job responsibilities as set forth herein or those which may,
commensurate with Executives position, be assigned from time to
time.  If it is determined by the Company that an agreement exists
that, in the Company’s sole discretion, would prevent or materially restrict
Executive’s ability to perform his duties under this Agreement, the Company
shall have the option to terminate this Agreement immediately and such
termination shall be considered for Good Cause as defined by Section 7(b) of
this Agreement.

        

        
          	
                  SECTION
      2.  

                	
                  COMPENSATION,
      BENEFITS AND OWNERSHIP.

                

        

         

        2.1 Compensation.  Executive
shall be paid a salary, and shall be eligible to receive incentive compensation,
as described in Exhibit A attached
hereto.  All compensation payable pursuant to any plan or program
described in Exhibit
A shall be governed by and subject to the applicable plan or program
documents, which may from time to time be amended, modified or terminated on
such terms and in such manner as is permitted in respect of the applicable plan
or program.

         

        2.2 Company
Benefits.  Subject to the satisfaction of the general rules for
eligibility and participation under the Company’s standard employee benefit
plans and practices, Executive shall be allowed to participate in the Company’s
standard employee benefit plans and practices which may be in effect from time
to time during the term of Executive’s employment and are provided by the
Company to its employees generally.  Such participation shall be
governed by the applicable plan documents, and the Company reserves the right,
in its discretion, to amend, modify, or discontinue any benefit plan or
practice.  You will have available up to three (3) weeks of annual
vacation, accruing as you employment continues throughout the year.

         

        2.3 Section 280G
Limitation.  In the event that any payments to which Executive
becomes entitled in accordance with the provisions hereof, or in connection with
any plans or programs referred to in Exhibit A or Section
2.2 hereof, would otherwise be deemed to constitute “parachute payments” (each
one, a “Parachute Payment”) within the meaning of Section 280G of the Internal
Revenue Code of 1986, as amended and the regulations and administrative guidance
thereunder (the “Code”), then such payments will be subject to reduction to the
extent necessary to assure that Executive receives only the greater benefit of
receiving (a) the amount of those payments which would constitute such a
Parachute Payment or (b) the amount which yields Executive the greatest
after-tax amount of benefits after taking into account any excise tax imposed on
the payments provided to Executive pursuant to this Agreement (or on any other
benefits to which Executive may be entitled in connection with the Change in
Control or the subsequent termination of service) under Section 4999 of the
Code.

         

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        
          	
                  SECTION
      3.  

                	
                  ASSIGNMENT
      OF INTELLECTUAL PROPERTY.

                

        

         

        3.1 Ownership and
Assignment of Intellectual Property.  All processes, products,
methods, improvements, discoveries, inventions, ideas, creations, trade secrets,
know-how, machines, programs, designs, routines, subroutines, techniques, ideas
for formulae, writings, books and other works of authorship, business concepts,
plans, projections and other similar items, as well as all business
opportunities discovered, conceived, designed, devised, developed, perfected or
made by Executive, whether alone or in conjunction with others and within the
course of Executive’s job responsibilities to the Company, and related in any
manner to the actual or anticipated business of the Company or to actual or
anticipated areas of research and development of the Company (all of the
foregoing collectively, the “Intellectual Property”), shall be promptly
disclosed to and are the property of the Company, and Executive hereby assigns,
transfers and conveys all of the Intellectual Property and all of Executive’s
rights therein to the Company.  The term “Intellectual Property” shall
be given the broadest interpretation possible and shall include any Intellectual
Property conceived, designed, devised, developed, perfected or made by Executive
during off-duty hours and away from the Company’s premises, as well as those
conceived, designed, devised, developed, perfected or made in the regular course
of Executive’s performance under this Agreement.

         

        3.2 Post-Employment
Assignment of
Intellectual Property.  In consideration of the benefits
provided pursuant to this Agreement, particularly those benefits conferred by
Section 7.5 and any stock option or similar rights pursuant to any Company plans
in which Executive was a participant, all Intellectual Property discovered,
conceived designed, devised, developed, perfected or made by Executive following
the termination of this Agreement shall be Intellectual Property covered by the
scope of Section 3.1 if it was conceived, in whole or in part, while this
Agreement remains in effect.  All Intellectual Property conceived,
designed, devised, developed, perfected or made by Executive within twelve (12)
months after termination of this Agreement shall be disclosed to the Company,
and shall be presumed to have been conceived, designed, devised, developed,
perfected or made by Executive during the Term, and Executive shall have the
burden of proving otherwise by clear and convincing evidence in order to
successfully rebut such presumption.

         

        3.3 Written
Assignments.  Executive shall execute and deliver, both during
the Term and thereafter in connection with a severance agreement required under
Section 7.5(g) to and in favor of the Company such assignments (including
patent, trademark and copyright assignments), documents, instruments and
applications (including patent, trademark or copyright applications) as the
Company may deem appropriate or necessary to claim, secure, acquire, perfect,
defend, enforce and/or assign any and all rights and privileges in and to or
arising from the Intellectual Property.  Executive shall also, both
during the Term and thereafter, cooperate with the Company, and to render such
assistance as the Company may reasonably require, in connection with any process
(whether administrative, judicial or otherwise) associated with the Company’s
efforts to claim, secure, protect, perfect, defend, assign and/or enforce such
rights and privileges in favor of the Company and its successors, licensees and
assigns.  Executive shall also, both during the Term and thereafter,
promptly disclose to the Company fully and in writing any Intellectual Property
that Executive may conceive, make, or develop, in whole or in part, by himself
or jointly with others, (a) whether or not it is conceived, made, developed or
worked on by Executive during his Term with the Company; (b) whether or not the
Intellectual Property was created at the suggestion of the Company; (c) whether
or not the Intellectual Property was reduced to drawings, written description,
documentation, models or other tangible form; and (d) whether or not the
Intellectual Property is related to the business of the Company.

         

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        3.4 Work Made for
Hire.  Executive acknowledges and agrees that any work of
authorship comprising Intellectual Property shall be deemed to be a “Work Made
for Hire,” to the extent permitted by the United States Copyright Act (17 U.S.C.
§ 101 (2000)).  To the extent that any such work of authorship may not
be deemed to be a Work Made for Hire, Executive hereby irrevocably assigns all
ownership rights in and to such work to the Company.  If any such work
of authorship cannot be assigned, Executive hereby grants to the Company an
exclusive, assignable, irrevocable, perpetual, worldwide, sub-licensable
(through one or multiple tiers), royalty-free, unlimited license to use, copy,
reproduce, distribute, modify, adapt, alter, translate, improve, create
derivative works of, practice, publicly perform, publicly display and digitally
perform and display such work in any media now known or hereafter
known.  Outside the scope of his employment, Executive agrees not to
(a) practice, display, copy, reproduce, distribute, transfer, modify, adapt,
alter, translate, improve, or create derivative works from, or otherwise use,
any such work of authorship or (b) incorporate any such work of authorship into
any product or invention unrelated to the Company’s business.  To the
extent moral rights (as defined by applicable law) may not be assignable under
applicable law and to the extent the following is allowed by the laws in the
various countries where moral rights exist, Executive hereby irrevocably waives
such moral rights and consents to any action of the Company that would violate
such moral rights in the absence of such consent.

         

        3.5 No License
Granted.  Executive acknowledges and agrees that nothing in
this Agreement shall be deemed to grant, by implication, estoppel, certain rules
of construction, or otherwise, (a) a license from the Company to Executive to
make, develop, use, license, disclose, or transfer in any
way  Intellectual Property or (b) a license from the Company to
Executive regarding any of the Company’s existing or future ownership
rights.

         

        
          	
                  SECTION
      4.  

                	
                  CONFIDENTIALITY.

                

        

         

        4.1 Confidentiality
Obligation.  Executive acknowledges and agrees that he has and
will have access to Proprietary, Trade Secret and Confidential Information (as
those terms are defined below in Section 4.2) as a result of his employment with
the Company, and that such information constitutes valuable, special and unique
property of the Company.  Without limiting the generality of the
foregoing, Executive expressly acknowledges that, in the course of performing
his services pursuant to this Agreement, he will obtain or learn Confidential
and Proprietary Information regarding the Company including, without limitation
information regarding the Company’s operations, financial results, pricing,
customers, suppliers and other matters.  Accordingly, at all times
while employed by the Company, and continuing for a period of three (3) years
with respect to Proprietary and Confidential Information, and for whatever time
Trade Secrets remain a Trade Secret under applicable law, following the
termination of his employment with the Company for whatever reason, Executive
shall neither use nor disclose, nor permit any person or entity within his
reasonable control to use or disclose, any Proprietary, Trade Secret, and
Confidential Information, and shall maintain and protect the secrecy of the
Proprietary, Trade Secret, and Confidential Information, except to the extent
required in the ordinary course of Executive’s employment with the Company, and
then only subject to the direction and control of the
Company.  Additionally, Executive shall cause all persons and entities
within his reasonable control to use their respective best effort(s), to
maintain and protect the secrecy of the Proprietary, Trade Secret and
Confidential Information.  Executive further acknowledges that in the
performance of his job duties to this Agreement, he will have access to and be
informed of the Proprietary and Confidential Information (as described in
Section 4.2) belonging to customers of Company, and that he shall return to the
Company any such information within his actual or indirect possession and comply
with any restrictions concerning such information that have been imposed upon by
the Company’s customer with respect to the use, disclosure, or return
information.

         

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        4.2 Definition
of
Proprietary, Trade Secret and Confidential
Information.  As used in this
Agreement the term “Proprietary, Trade Secret and Confidential Information”
means any non-public knowledge, information or property relating to, used or
possessed by the Company (or its customers, as the case may be), and includes,
without limitation, the following:  trade secrets, patents,
copyrights, software (including, without limitation, all programs,
specifications, applications, routines, subroutines, techniques, code and ideas
for formulae); ideas, information, concepts, data, drawings, designs and
documents; names of clients, customers, but not limited to employees, agents,
contractors and suppliers; business plans, marketing plans and marketing
information; financial, pricing, and cost information and other business
records; and all copies of any of the foregoing.   Trade Secrets
shall be such information defined by applicable law as a Trade
Secret.

         

        4.3 Return of
Confidential Information.  Executive agrees that he shall
immediately, upon the request of the Company, return to the Company all
Proprietary, Trade Secret, and  Confidential Information and any other
tangible material containing, prepared on the basis of or reflecting any
Proprietary, Trade Secret and  Confidential Information (whether
prepared by the Company, Executive or otherwise) and shall not retain any
copies, extracts or other reproductions, in whole or in part, of such
Proprietary, Trade Secret, and  Confidential Information.

         

        4.4 Return of Company
Property.  All products, records, designs, patents, trademarks,
copyrights, plans, manuals, memoranda, lists and other documents or other
property of the Company or any of its affiliates in the possession or control of
Executive and all records compiled by the Executive which pertain to the
business of the Company or its affiliates, shall be and remain the property of
the Company and shall be subject at all times to its discretion and
control.  Likewise, all correspondence with customers or affiliates of
the Company, all reports, records, charts, and advertising materials and any
data pertaining to the Company, its affiliates or the business of the Company or
its affiliates that are held by or on behalf of Executive shall be delivered
promptly to the Company without request on the date Executive’s employment with
the Company terminates or at any other time promptly upon request by the
Company.

         

        4.5 Nature of
Obligation.  The obligations of Executive set forth in this
Section 4 are in addition to, and not in lieu of, any of Executive’s duties or
the Company’s rights and remedies, at law or in equity, with respect to the
Company’s Proprietary, Trade Secret, and Confidential Information and
property.  The Company may pursue all such rights and remedies, as
well as remedies for the breach of the provisions set forth
herein.  The Proprietary, Trade Secret and  Confidential
Information and other property referenced in this Section 4 constitute valuable
property of the Company or its customers, the ownership of which is not
dependent upon the performance by the Company of any of its obligations under
this Agreement or the performance of any legal, statutory or other duty, if any,
to Executive.  Accordingly, Executive shall perform his obligations
under this Section 4 regardless of any alleged or actual breach or failure to
perform by the Company.

         

        4.6           Post Termination
Activities.  Executive
acknowledges and agrees that, during the course of his employment with the
Company, he had access to the Company’s Proprietary, Trade Secret and
Confidential Information and that disclosure to or use of such information by a
competitor of the Company would cause the Company irreparable
harm.  Executive agrees and acknowledges that should he engage in the
restricted activities as set forth in Section 5 hereof, he will inevitably
disclose the Company’s Proprietary, Trade Secret and Confidential
Information.

         

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        

        
          	
                  SECTION
      5.  

                	
                  NONCOMPETITION
      AGREEMENT.

                

        

         

        In
consideration of the compensation paid or payable to Executive by the Company
pursuant to this Agreement (including, but not limited to, Section 2 hereof),
Executive hereby agrees as follows:

         

        5.1 Executive acknowledges that the Company’s business is
nationwide in scope, that its customers are not restricted to any single state
in the United States or geographic area of North America, and that in the
performance of his duties as set forth in this Agreement, Executive shall
perform services on behalf of the Company which require the use of Executive’s
unique and extraordinary skills.  During the term of this
Agreement, Executive will devote all of his working time and energies to the
Company, and will not, without the Company’s express written permission, own,
work for or provide services to any other entity, whether as an owner, partner,
agent, representative, consultant, officer, director, independent contractor or
employee.  Notwithstanding the foregoing, Executive is permitted to
own up to 1% of any class of securities of any corporation in competition with
the Company that is actively traded on a national securities exchange or through
NASDAQ.

         

        5.2           As
consideration granted herein, Executive hereby covenants that he will
not,  within the Territory and during the Noncompetition Period,
without the prior written consent of the Company, engage in any Restricted
Activities for or on behalf of any corporation, partnership, venture or other
business entity which is engaged in the Restricted Business in the same or
similar capacity as Executive performed for the Company. The term “Noncompetition Period” means
the period beginning on the date of this Agreement and ending one year after the
date Executive’s employment with the Company ends or is terminated for any
reason. The term “Restricted
Activities” means having ownership of or being employed by as an
employee, agent, or representative, or as an independent contractor or
otherwise, and providing services similar to the services Executive provides to
the Company.  The term “Restricted Business” means
the business of providing energy load control or demand response products and
services, energy capacity, energy efficiency, advanced metering solutions, or
other alternative energy solutions, which Executive acknowledges and agrees is
the business in which the Company is engaged. The term “Territory” means North
America which Executive acknowledges is the  geographic scope
of the Company’s business and is the territory for or in which Executive
performs services for the Company.  Employee acknowledges that in the
performance of his duties hereunder that he will have significant and extensive
knowledge of the Company’s markets and Customers or Prospective Customers (as
defined below) with whom the Company does business, regardless of any specific
geographic location, and will have received specialized training with respect to
the Company’s products and services offered by the Company within those markets
and with those Customers or Prospective Customers.

        

        SECTION
6.  NONSOLICITATION AGREEMENT

        

        6.1           During
the term of this Agreement and for a period of one (1) year after Executive’s
employment is terminated for any reason, Executive will not, directly or
indirectly, individually or on behalf of any other person, firm, partnership,
corporation, or business entity of any type, solicit, assist or in any way
encourage any current employee or consultant of the Company, whom Executive
supervised or had responsibility for during the twelve (12) months prior to the
termination of employment, to terminate his or her employment relationship or
consulting relationship with or for the Company, nor will Executive solicit the
services of any former employee or consultant of the Company whom Executive
supervised or had responsibility for during the twelve (12) months prior to the
termination of employment, whose service with the Company has been terminated
for less than six (6) months.

         

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        6.2

         

        (a)
During the term of this Agreement and for a period of one (1) year after
Executive’s employment is terminated for any reason, Executive will not,
directly or indirectly, individually or on behalf of any other person, firm,
partnership, corporation, or business entity of any type, solicit, divert, or
take away, or attempt to solicit, divert, or take away, in whole or in part, any
Customer of the Company or otherwise interfere with the Company’s relationship
with any Customer, for the purpose of competing with the Company in the
Business.  For purposes of this Agreement, “Customer”
shall mean any person, company or business entity to which the Company sells,
sold, licenses or licensed goods or services at the time Executive’s employment
with the Company terminated and for the preceding twelve (12) months and with
whom Executive had material business contact and “Business”
shall mean providing energy related services, including without limitation
energy load control or demand response products and services, energy capacity,
energy efficiency, advanced metering solutions, or other alternative energy
solutions engaged in by the Company.

         

        (b)           During
the term of this Agreement, and for a period of twelve (12) months after
Executive’s employment ends or is terminated for any reason, Executive will not,
directly or indirectly, individually or on behalf of any person, firm,
partnership, corporation, or business entity  of any type, solicit,
divert or take away, or attempt to solicit, divert or take away, in whole or in
part, any Prospective Customer of the Company or otherwise interfere with the
Company’s relationship with any Prospective Customer, for the purpose of
competing with the Company in the Business.  For purposes of this
Agreement, “Prospective
Customer” shall mean those persons, companies or businesses to whom the
Company made a proposal for the purchase of the Company’s goods or services on
behalf of the Company for such Prospective Customer to within the twelve (12)
months  prior to the end or termination of Executive’s employment with
the Company.

        

        6.3           Enforcement.  The existence of
any claim or cause of action of Executive against the Company, whether
predicated on this Agreement or otherwise, shall not preclude the Company’s
enforcement of these covenants.

        

        6.4           Reasonable
Covenants.  Executive
acknowledges and agrees that the covenants set forth in this Section 6 are
necessary and reasonable to protect the Company and the conduct of its business
and are a fair and reasonable restraint on Executive in light of the activities
and business of the Company on the date of execution of this Agreement and the
future plans of the Company; and that such covenants also be construed and
enforced in light of the activities and business of the Company (including
business activities in the planning stage) on the date of termination of
Executive’s employment with the Company.  Executive acknowledges that
he will not suffer any undue hardship as a result of the covenants set forth in
Sections 4, 5 and 6 and that he will be able to pursue his occupation
nothwithstanding his obligations under Sections 4, 5 and 6.

         

        6.5           Survival.  The provisions of
this Section 6 shall survive any termination of this Agreement and are subject
to paragraph 8 of this Agreement.

         

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        SECTION 7.  TERMINATION OF
EMPLOYMENT.

        

        7.1Certain Definitions.  As
used herein, the following terms shall have the following
definitions:

         

        (a) Affiliate.  “Affiliate”
shall mean an affiliate of the Company, as defined in Rule 12b-2 promulgated
under Section 12 of the Securities Exchange Act of 1934, as amended from time to
time.

         

        (b) Cause.  A
termination by the Company with “Cause” shall include (without limitation) (i)
non-performance in the roles and duties, as assigned; (ii) Executive’s breach of
any material provision of this Agreement; (ii) Executive’s material breach of
any written Company policy contained in the Company’s manual of policies and
procedures; or material non-compliance with any lawful direction given by the
Company’s Chief Executive Officer or his/her delegate; (iii) Executive’s
Disability (subject to Company’s legal obligations); (iv) Executive’s fraud with
respect of the business or affairs of the Company; (v) the commission by
Executive, or entering of a plea of nolo contendere with regard
to, a felony or a crime involving moral turpitude; or (vi) alcohol abuse or
illegal drug use by Executive; provided however, that in the
event of Executive’s breach as set forth in Sections 7(b)(i) and (ii) above, no
Cause for termination shall be deemed to exist for any such breach that is
curable and which in fact is cured by Executive within thirty (30) days after
notice of such termination has been delivered to Executive, and in the event of
Executive’s breach, as set for in Section 7(b)(vi) above, no Cause shall be
deemed to exist if the Executive and Company agree on a remedial program for
Executive and so long as Executive in all respects complies with the
requirements of such program.  During the time of Executive’s
participation in any remedial program as set forth above, Executive shall, if
directed by the Company, be on a paid leave of absence away from the Company’s
premises.

         

        (c) Change in
Control.  For purposes of this Agreement, “Change in Control”
means the occurrence of any of the following events if, following such
occurrence, a Board Change (as hereinafter defined) occurs:

         

        (i) any
person becomes the beneficial owner, directly or indirectly, of securities of
the Company (not including in the securities beneficially owned by such person
any securities acquired directly from the Company or its affiliates)
representing fifty percent (50%) or more of the combined voting power of the
Company’s then outstanding voting securities; or

         

        (ii) a merger
or consolidation of the Company is consummated with any other corporation, other
than (A) a merger or consolidation which would result in the voting securities
of the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving or parent entity) more than fifty percent (50%) of the combined
voting power of the voting securities of the Company or such surviving or parent
equity outstanding immediately after such merger or consolidation;
or

         

        (iii) there is
consummated an agreement for the sale or disposition by the Company of all or
substantially all of the Company’s assets (or any transaction having a similar
effect), other than a sale or disposition by the Company of all or substantially
all of the Company’s assets to an entity, at least fifty percent (50%) of the
combined voting power of the voting securities of which are owned by
stockholders of the Company in substantially the same proportions as their
ownership of the Company immediately prior to such sale, provided that such
transferee entity confirms in writing that it is bound by the terms of this
Agreement.

         

        In the
event that the foregoing definition of Change in Control does not comply with
the requirements of Section 409A of the Code, and an amount, benefit or item of
compensation hereunder would be subject to Section 409A of the Code, but would
not be so subject if the definition of Change in Control above complied with the
requirements of Section 409A of the Code, then with respect only to such amount,
benefit or item of compensation, the term “Change in Control” shall mean a
“change in control event” within the meaning of Treas. Reg.
§1.409A-3(i)(5).

         

        (d) Board
Change.  “Board Change” means any change in directors after
giving effect to any of the transactions described above as a result of which
the individuals serving on the Board prior to such transaction no longer
comprise at least a majority of the directors on the Board immediately after
giving effect to such transaction.

         

        (e) Good Reason.  A
termination by the Executive for “Good Reason” means termination by Executive
following (i) a reduction in Executive’s Annual Salary or other material
component of compensation (excluding stock options or similar grants) required
to be paid pursuant hereto without Executive’s prior written consent; or (ii)
the Company’s relocation of the Executive, without the Executive’s consent, to a
permanent location more than seventy-five (75) miles from the location specified
in Section 1.3 of this Agreement; provided however, that no
Good Reason for Executive’s termination shall be deemed to exist unless (i)
Executive gives notice to the Company of the action or condition which would
constitute Good Reason within sixty (60) days of the initial existence of such
action or condition, (ii) the action or condition which would constitute Good
Reason is not cured by the Company within the 30-day period after the timely
provision of the notice required herein, and (iii) Executive effects the
termination for Good Reason within thirty (30) days after the expiration of the
30-day cure period.  After such thirty
(30) day period, Executive shall be deemed to have waived any right to terminate
this Agreement pursuant to this Section 7.1(e).

        
          (f) Non-Renewal.                                 A non-renewal of this Agreement as provided in
Section 1.4 shall not be considered a termination under any provision of this
Section 7 and, upon such non-renewal by either party and the termination of this
Agreement, and Company shall be required to pay to Executive only the amounts
specified in Section 7.5 (a).

           

           

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

          
            7.2         Death by
Executive.  This Agreement shall terminate upon Executive’s
death.

             

            7.3         By the
Company.  The Company shall have the right to terminate
Executive’s employment with the Company, at any time, with or without
Cause.  For avoidance of doubt, the parties agree that Executive has
no right to continue at any time in any office of the Company after being
removed from such office in the manner provided in the Company’s bylaws or other
applicable provisions of the Company’s governing law and
instruments.

             

                7.4    By
Executive.  Executive may terminate his employment with the
Company at any time, upon providing thirty (30) days advance notice, either with
or without Good Reason.  In the event Executive terminates his
employment with the Company with Good Reason, such notice shall specify the
grounds for such termination, and the Company shall have the opportunity to cure
such grounds for termination in accordance with the provisions of Section
7.1(e).

             

            7.5
Severance Pay, Other Post-Employment Payments and Acceleration of Benefits Upon
Certain Terminations.  

             

            (a) Termination by the Company
for Cause or by Executive
without Good Reason.  If the Company terminates Executive’s
employment for Cause, or Executive terminates his employment without Good
Reason, then in either such event, Executive shall not be entitled to any
severance pay, and shall only be entitled to (i) any unpaid, but earned, salary,
(ii) any unpaid but earned vacation in accordance with Company policy then in
effect and (iii) any incurred but unpaid ordinary and necessary business
expenses properly documented by Executive in accordance with the Company’s then
effective expense reimbursement policy.

             

            (b) Termination by the Company Without
Cause, or by Executive for Good Reason.  Subject to subsection
7.5(c) below, if the Company terminates Executive’s employment without Cause, or
Executive terminates his employment with Good Reason, then in such event
Executive shall be entitled to all payments allowed pursuant to subsection
7.5(a) above and severance pay in the amount of the sum of (i) twelve (12)
months’ annual base salary as specified in Exhibit A, plus (ii)
an amount equal to the amount of Executive’s bonus payment for the last complete
year of service prior to termination, times a fraction, the numerator of which
is the number of days in the year of Executive’s termination through the date of
such termination, and the denominator of which is 365 (or in the case of leap
years, 366). The benefits provided pursuant to
this Section 7.5(b) shall not include any stock option or similar grants and
Executive’s rights concerning any stock option or similar grants shall be
exclusively determined by applicable Company policies or plans concerning such
grants.

             

            (c) Certain Terminations Following a
Change in Control.  Notwithstanding the provisions of Section
7.5(b) above, in the event the Company terminates Executive’s employment without
Cause, or Executive terminates his employment with Good Reason, concurrently
with or within twelve (12) months following a Change in Control, then, in lieu
of the payments specified in Section 7.5(b), Executive shall be entitled to all
payments allowed pursuant to subsection 7.5(a) above and severance pay in the
amount of eighteen (18) months’ annual base salary as specified in Exhibit A, plus one
and one.half times (1.5x) the amount of Executive’s bonus payment for the last
complete calendar year prior to Executive’s termination of
employment.  In such event, all unvested options to purchase Company
stock held by Executive shall immediately vest and become exercisable and all
restricted stock granted to Executive shall immediately vest and the legend
providing restrictions on the sale or transfer of such stock related to such
vesting shall be removed at the request of the Executive.

             

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

              

            

             

            (d) Continuation of
Benefits.  In the event the Company terminates Executive’s
employment without Cause, or Executive terminates his employment with Good
Reason, and Executive qualifies for and becomes entitled to the severance pay
provided pursuant to Section 7.5(b) or (c) above, as applicable: (1) the Company
shall continue to provide benefits referred to in Section 2.2 during the period
Executive is entitled to severance payments under this Agreement, subject to and
in accordance with Executive’s COBRA rights and the provisions of the applicable
plan documents, and the Company reserves the right, in its discretion, to amend,
modify, or discontinue any benefit plan or practice; and (2) if Executive elects
to participate in COBRA coverage for which he and/or his family is eligible
under the Company’s then-effective health plans, the Executive shall pay to the
Company on a monthly or quarterly basis, as the case may be, an amount equal to
the co-payment amount for which the Executive would have been responsible had he
remained an employee during the COBRA coverage period and the Company shall pay
to the plan administrator on behalf of Executive the entire cost of the COBRA
coverage.  Executive agrees to a netting of payments where
applicable.

             

            (e) Death or
Disability.  Any termination of this Agreement by reason of
Executive’s death or disability shall not give rise to any severance payment
hereunder, but shall be without prejudice to any benefits payable to Executive
or his estate under applicable company benefits relating to such
event.  For purposes of this Agreement, the term “Disability” shall
mean the Executive’s inability to perform his duties, in all material respects,
because of illness, physical or mental disability, or other incapacity that
continues for an uninterrupted period of one hundred eighty (180)
days.  Executive’s unvested stock options and restricted stock not
otherwise vested shall vest upon the death or disability of Executive as
provided in, and subject to the provisions of, applicable Company policies or
plans concerning the grants to Executive of unvested stock options and
restricted stock.

             

            (f) Timing of
Payments.  All severance payments provided pursuant to Section
7.5(b) above, as applicable, that are measured by Executive’s annual base salary
shall begin as provided by Section 7.5(g) (except as otherwise required by
Section 10.11) and shall thereafter be paid at such times and in accordance with
the Company’s payroll policies and procedures as if Executive were still
employed by the Company; and all amounts of severance pay with respect to bonus
payments shall be pro rated over the period of such payment, and payments of a
proportional amount of such bonus payments shall begin as provided by Section
7.5(g) (except as otherwise required by Section 10.11) and shall thereafter be
paid at such times as base salary payments are made.   All
severance payments provided pursuant to Section 7.5(c) above, as applicable,
that are measured by Executive’s annual base salary shall be paid in one lump
sum amount as provided by Section 7.5(g) (except as otherwise required by
Section 10.11).

             

            (g) Requirements Regarding Eligibility
to Receive Severance Payments.  Notwithstanding any of the
other provisions hereof, the Company shall not be obligated to make and shall
not make the severance payments provided under Section 7.5(b) or (c) above
unless Executive executes and delivers to the Company within thirty (30) days
from the date on which the Executive’s employment is terminated, and does not at
any time after execution and delivery withdraw or revoke, a Severance Agreement containing a general
release in a form reasonably acceptable to the Company and the assignment as set forth in Section 3.3.
Furthermore, in the event Executive initially qualifies to receive the payments
and benefits provided under this Section 7.5, but then fails to comply with his
obligations under this Agreement (including without limitation Sections 3, 4,5
and 6 hereof), the Company’s obligations under this Section 7.5 shall
terminate.

             

            (h) Termination of other Compensation
and Benefits.  Except as otherwise required by applicable law
or as provided above in this Section 7.5, Executive’s eligibility for or
entitlement to any other compensation or benefits shall cease immediately upon
termination of this Agreement and Executive’s employment with the
Company.

             

             

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

              

            

             

            (i) Characterization of Payments under
Section 409A.  For purposes of Section 409A of the Code
(including, but not limited to, to application of the exceptions for short-term
deferrals and for “separation pay only upon an involuntary separation from
service”): (i) each payment provided for under this Section 7.5 is hereby
designated as a separate payment, rather than a part of a larger single payment
or one of a series of payments; and (ii) with respect to the severance payments
and benefits to which Executive may become entitled under Section 7.5 of this
Agreement and which are not in substitution or replacement of “nonqualified
deferred compensation” (within the meaning of Section 409A of the Code), a
termination of Executive’s employment by the Company without Cause or by
Executive for Good Reason is intended to constitute an “involuntary separation
from service” and, in turn, a “substantial risk of forfeiture” (within the
meanings of Section 409A of the Code).

             

            7.6           Effect of
Termination.  Termination of Executive’s employment with the
Company shall not limit, affect, or discharge Executive’s obligations under
Sections 3, 4 5 and 6 of this Agreement and shall not release the Company from
its obligations to make payments or provide benefits required by Sections 2.2
and 7.5 of this Agreement following such termination (subject to the limitations
provided in Section 7.3).  All other obligations as to periods after
the date of termination shall cease, without prejudice to the rights and
remedies for events or breaches prior to the date of termination.

             

            7.7           Waiver.  The Company may
waive or defer exercising its power to terminate this Agreement, but such waiver
or deferral shall not thereby (a) establish a policy, interpretation, or course
of performance that may be used to construe, limit or affect the express terms
of this Agreement, (b) preclude the Company from exercising its rights or
remedies hereunder or otherwise on any other occasion or from using the breach
as support for the exercise of its power to terminate on any future occasion or
(c) limit the ability of the Company to revoke such waiver or deferral and
exercise its power to terminate this Agreement if it determines that the
condition giving rise to a power to terminate has continued, or if the Company
determines in good faith that it was not fully aware of all facts and
circumstances of such condition, or if such waiver or deferral may be retracted
at common law.

             

             SECTION
8.  CERTAIN REMEDIES.

             

            With
respect to each and every breach or violation or threatened breach or violation
by Executive of Sections 3, 4, 5 and 6 of this Agreement, the Company, in
addition to all other remedies available at law or in equity, including, but not
limited to, specific performance of the provisions hereof, shall be entitled to
enjoin the commencement or continuance thereof and may, without notice to
Executive, apply to any court of competent jurisdiction for entry of an
immediate restraining order or injunction, without the necessity of proving
either inadequacy of legal remedies or irreparable harm and without the
necessity of posting a bond.  The Company shall also be entitled to
the recovery of reasonable attorney’s fees and expenses incurred in conjunction
with any such proceeding.

             

            
              	
                       
      

                    	
                      SECTION
      9.  SEVERABILITY AND
      REFORMATION.

                    

            

             

            The
provisions of this Agreement are severable, and any judicial determination that
one or more of such provisions, or any portion thereof, is invalid or
unenforceable shall not affect the validity or enforceability of any other
provisions, or portions thereof, but rather shall cause this Agreement to first
be construed in all respect as if such invalid or unenforceable provisions, or
portions thereof, were modified to terms that are valid and enforceable and
provide the greatest protection to the Company’s business and interests; provided, however, that if
necessary to render this Agreement enforceable, it shall be construed as if such
invalid or unenforceable provisions, or portions thereof, were
omitted.

             

            
              	
                       
      

                    	
                      SECTION
      10.  GENERAL PROVISIONS.

                    

            

             

            10.1  Notices.  Any
notices provided hereunder must be in writing and shall be deemed effective upon
the earlier of personal delivery (including personal delivery by fax) or the
third day after mailing by first class mail, to the Company at its primary
office location and to Executive at Executive’s address as listed on the Company
payroll.

             

            10.2  Waiver.  If
either party should waive any breach of any provision of this Agreement, he or
it shall not thereby be deemed to have waived any preceding or succeeding breach
of the same or any other provision of this Agreement.

             

             

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

              

            

             

            10.3  Complete
Agreement.  This Agreement constitutes the complete, final and
exclusive embodiment of the agreement of the Company and Executive with regard
to the subject matter hereof, and supersedes and replaces in all respects any
previous offers, agreements solely regarding Executive’s employment by the
Company or the terms thereof.  This Agreement is entered into without
reliance on any promise or representation other than those expressly contained
herein, and this Agreement cannot be modified or amended except in a writing
signed by Executive and an authorized officer of the Company.

             

            10.4  Counterparts.  This
Agreement may be executed in multiple counterparts, each of which shall be
deemed an original, but all of which taken together shall constitute one and the
same instrument.

             

            10.5  Headings.  The
headings of the sections hereof are inserted for convenience of reference only
and shall not be deemed to constitute a part hereof or affect the meaning or
interpretation of any of the provisions hereof.

             

            10.6  Successors and
Assigns.  This Agreement is intended to bind, inure to the
benefit of, and be binding upon, the successors and assigns of the Company,
including the surviving entity of any merger, consolidation, share exchange or
combination of the Company with any other entity.  Notwithstanding the
foregoing, Executive may not assign, transfer or delegate any of Executive’s
duties or obligations hereunder, and Executive may not assign or transfer any of
Executive’s rights hereunder without the written consent of the
Company.

             

            10.7  Choice of Law and
Venue.  All questions concerning the construction, validity and
interpretation of this Agreement shall be governed by the law of the State of
Pennsylvania).  Any
dispute arising out of, or concerning, this Agreement or the employment
relationship between the parties, shall be resolved exclusively in a federal or
state court of competent jurisdiction located in Allegheny County, Pennsylvania.
 To the extent
necessary, the parties hereby submit to, and agree not to contest, the
jurisdiction of such courts.

             

            10.8  Representations.  Each
party represents and warrants to the other that he or it has full power and
authority to enter into and perform this Agreement and that his or its execution
and performance of this Agreement shall not constitute a default under or breach
of any of the terms of any agreement to which he or it is a party or under which
he or it is bound.  Each party represents that no consent or approval
of any third party is required for his or its execution, delivery and
performance of this Agreement or that all consents or approvals of any third
party required for his or its execution, delivery and performance of this
Agreement have been obtained.

             

            10.9  Withholding.  Any
and all amounts payable under this Agreement, including without limitation,
amounts payable under Section 2.1 or Section 7.1(c) hereof, are subject to
withholding for such federal, state, and local taxes as the Company, in its
reasonable judgment, determines to be required pursuant to any applicable law,
rule or regulation.

             

            10.10  Survival.  The
provisions of Sections 3, 4, 5, 7, 8, 9 and 10 of this Agreement shall survive
the termination of this Agreement for whatever reason.

             

            10.11  Section
409A.   If the Executive is a “key employee,” as defined
in Section 416(i) of the Code (without regard to paragraph 5 thereof), except to
the extent permitted under Section 409A of the Code, no benefit or payment that
is subject to Section 409A of the Code (after taking into account all applicable
exceptions to Section 409A of the Code, including but not limited to the
exceptions for short-term deferrals and for “separation pay only upon an
involuntary separation from service”) shall be made under this Agreement on
account of the Executive’s “separation from service,” as defined in Section 409A
of the Code, with the Company until the later of the date prescribed for payment
in this Agreement and the first day of the seventh calendar month that begins
after the date of the Executive’s separation from service (or, if earlier, the
date of death of the Executive).

             

            

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

              

            

            

            IN
WITNESS WHEREOF, the Company and Executive have executed this Agreement to be
effective as of the day and year first above written.

            

            THE
“COMPANY”

            

            COMVERGE,
INC.

            

            

            By:      /s/ Blake
Young

            Name:
Blake
Young

            Title:  President &
CEO

            

            “EXECUTIVE”

            

            

            By:      /s/ Christopher
Camino

            Name:
Chris
Camino

            Title:  EVP of Sales, Chief
Marketing Officer

             

             

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

              

            

            

            

             

            Exhibit
A

             

            
              	
                      Annual
      Salary

                       

                    	
                      Executive
      shall be paid at the rate of $300,000 per annum.

                    
	
                      Annual
      Cash Incentive1*

                    	
                      Executive
      will have the opportunity to earn an annual bonus equal to 25%
      (threshold), 50% (target) or 100% (maximum) of his annual salary based on
      the achievement of performance criteria established by the Compensation
      Committee, where such payment shall be pro-rated from the start date for
      2010.

                       

                    
	
                      Annual
      Equity Incentive1

                    	
                      Beginning
      in calendar year 2011 and thereafter, Executive will have the opportunity
      to earn an annual equity award comprised of a combination of restricted
      stock and options valued at 1.13 times salary (threshold), 1.50 times
      salary (target) or 1.88 times salary (maximum) based on the achievement of
      performance criteria established by the Compensation
      Committee.   Executive shall be eligible for payment of
      this Annual Equity Incentive, if earned, no earlier than mid-March 2012
      for the 2011 calendar year.

                       

                    
	
                      Initial
      Equity/Stock Option Grants

                    	
                      Upon
      approval of the Company’s Compensation Committee, which shall be at or
      around  the execution of the Agreement, and in consideration of
      Executive’s obligations contained therein, including but not limited to
      the discontinuance of any business or business activities in which
      Executive was engaged prior to the execution of this Agreement, Executive
      shall be granted _____ shares of restricted stock and ______ stock
      options.

                       

                      Restricted
      stock shall vest ______ shares on _____, 20___, which is the third year
      after the date this Agreement is executed.

                       

                      The
      stock options granted under this Agreement shall be at a strike price
      equal to the closing price of the Company’s common stock as of the date
      that the Board consents to the appointment of Executive as EVP of Sales,
      and shall vest quarterly on a pro rata basis over the
      next four years.

                       

                       

                    

            

            

              

            

              
              1   The
compensation committee will set Target, Threshold, and Maximum performance
levels for Annual Cash and Equity incentives.  The Threshold
performance level is the minimum level of performance required as a condition of
earning any incentive.  The Target performance level is the level of
performance at which the executive, operating division or company is expected to
perform.  The Maximum performance level is the highest level of
payout.  The committee has discretion to grant or not grant such
Annual Cash or Annual Equity Incentives, if in its reasonable discretion, is in
the best interests of the Company.

               

               

               

              
                
                  
                  

                

                
                  
                  

                  
                    

                  

                

                
                  
                  

                

              

            

            FIRST
AMENDMENT TO

            EMPLOYMENTAGREEMENT

            

            

            THIS FIRST AMENDMENT TO EMPLOYMENT
AGREEMENT ("First Amendment") is entered into by and between COMVERGE
INC. (formerly Comverge Technologies, Inc.), a Delaware corporation ("Company"),
and Chris Camino ("Executive") as of today, May 24, 2010.

            

            WHEREAS, the Company and
Executive have heretofore entered into that certain Employment Agreement (the
"Employment Agreement"); and

            

            WHEREAS, the Company and
Executive desire to amend the Employment Agreement;

            

            NOW, THEREFORE, in
consideration of the premises set forth above and the mutual agreements set
forth herein, the Company and Executive hereby agree, effective as of the date
set forth above, that the Employment Agreement shall be amended as hereafter
provided:

            

            1.           The
Effective Date of the Employment Agreement is amended from June 21, 2010 and
shall now commence on June 14, 2010 ("Effective Date"). Executive shall work
from the Atlanta, Georgia office the week of June 14 for transition
purposes.

            

            2.           Except
as expressly modified by this First Amendment, the terms of the Employment
Agreement shall remain in full force and effect and are hereby confirmed and
ratified.

            

            IN WITNESS WHEREOF, the
parties hereto have executed this First Amendment as of the date first set forth
above.

            

            COMVERGE,
INC.

            

            

            

            By:             
/s/ R. Blake
Young

            Name:         R.
Blake Young

            Title:           President
& CEO

            

            

            

            By:           /s/ Chris
Camino

            Name:     Chris
Camino

            EVP of
Sales, Chief Marketing Officer

             

             

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

              

            

            

            SECOND
AMENDMENT TO

            EMPLOYMENT
AGREEMENT

            

             

            THIS SECOND AMENDMENT TO EMPLOYMENT
AGREEMENT (“Second Amendment”) is entered into by and between COMVERGE
INC., a Delaware corporation (“Company”), and Chris Camino (“Executive”) as of
today, June 10, 2010.

             

            WHEREAS, the Company and
Executive have heretofore entered into that certain Employment Agreement, as
amended to have a start date of June 14, (the “Employment Agreement”);
and

             

            WHEREAS, the Company and
Executive desire to amend the Employment Agreement;

             

            NOW, THEREFORE, in
consideration of the premises set forth above and the mutual agreements set
forth herein, the Company and Executive hereby agree, effective as of the date
set forth above, that the Employment Agreement shall be amended as hereafter
provided:

             

            1. Attachment A of the
Employment Agreement is amended and replaced to set the number of options and
restricted stock to be provided to Executive upon the Compensation Committee’s
consent.

             

            2. Except as
expressly modified by this Second Amendment, the terms of the Employment
Agreement shall remain in full force and effect and are hereby confirmed and
ratified.

             

            IN WITNESS WHEREOF, the
parties hereto have executed this First Amendment as of the date first set forth
above.

             

            

             

            COMVERGE , INC.

             

            

             

            By:                  /s/ R. Blake
Young

            Name:             R.
Blake Young

            Title:               President
& CEO

            

             

            By:                /s/ Chris
Camino

            Name:          Chris
Camino

                         EVP
of Sales, Chief Marketing Officer

             

             

            
              
                
                

              

              
                
                

                
                  

                

              

              
                
                

              

            

            Exhibit
A

             

            
              	
                      Annual
      Salary

                       

                    	
                      Executive
      shall be paid at the rate of $300,000 per annum.

                    
	
                      Annual
      Cash Incentive1*

                    	
                      Executive
      will have the opportunity to earn an annual bonus equal to 25%
      (threshold), 50% (target) or 100% (maximum) of his annual salary based on
      the achievement of performance criteria established by the Compensation
      Committee, where such payment shall be pro-rated from the start date for
      2010.

                       

                    
	
                      Annual
      Equity Incentive1

                    	
                      Beginning
      in calendar year 2011 and thereafter, Executive will have the opportunity
      to earn an annual equity award comprised of a combination of restricted
      stock and options valued at 1.13 times salary (threshold), 1.50 times
      salary (target) or 1.88 times salary (maximum) based on the achievement of
      performance criteria established by the Compensation
      Committee.   Executive shall be eligible for payment of
      this Annual Equity Incentive, if earned, no earlier than mid-March 2012
      for the 2011 calendar year.

                       

                    
	
                      Initial
      Equity/Stock Option Grants

                    	
                      Upon
      approval of the Company’s Compensation Committee, which shall be at or
      around June 14, and in consideration of Executive’s obligations contained
      therein, including but not limited to the discontinuance of any business
      or business activities in which Executive was engaged prior to the
      execution of this Agreement, Executive shall be granted 25,000 shares of
      restricted stock and 150,000 stock options.

                       

                      Restricted
      stock shall vest 25,000 shares on June 14, 2013, which is the third year
      after the date this Agreement is executed and shall have a price equal to
      the closing price of the Company’s common stock as of the date that the
      Board consents.

                       

                      The
      stock options granted under this Agreement shall be at a strike price
      equal to the closing price of the Company’s common stock as of the date
      that the Board consents to the appointment of Executive as EVP of Sales,
      and shall vest quarterly on a pro rata basis over the
      next four years.

                       

                    

            

            

            

              

            

              
              1   The
compensation committee will set Target, Threshold, and Maximum performance
levels for Annual Cash and Equity incentives.  The Threshold
performance level is the minimum level of performance required as a condition of
earning any incentive.  The Target performance level is the level of
performance at which the executive, operating division or company is expected to
perform.  The Maximum performance level is the highest level of
payout.  The committee has discretion to grant or not grant such
Annual Cash or Annual Equity Incentives, if in its reasonable discretion, is in
the best interests of the Company.

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