Document:

Exhibit 10.2

 

SECURITIES PURCHASE
AGREEMENT

 

BY AND BETWEEN

 

CHARLES H. BEYNON

 

AND

 

BROADWIND ENERGY, INC.

 

 

APRIL 22, 2008

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE 1 Definitions

  	
  1

  
	
   

  	
   

  
	
  ARTICLE 2 Purchase
  and Sale of Shares

  	
  3

  
	
   

  	
   

  
	
  2.1

  	
  Purchase of Shares

  	
  3

  
	
  2.2

  	
  Closing

  	
  3

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3 Buyer’s Representations and Warranties

  	
  4

  
	
   

  	
   

  
	
  3.1

  	
  Intentionally Omitted

  	
  4

  
	
  3.2

  	
  Additional Representations and Warranties

  	
  4

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4 Representations and Warranties of the Company

  	
  5

  
	
   

  	
   

  
	
  4.1

  	
  Organization and Qualification

  	
  5

  
	
  4.2

  	
  Authorization; Enforcement

  	
  6

  
	
  4.3

  	
  Capitalization; Valid Issuance of Shares

  	
  6

  
	
  4.4

  	
  No Conflicts

  	
  7

  
	
  4.5

  	
  SEC Documents; Financial Statements

  	
  7

  
	
  4.6

  	
  Absence of Certain Changes

  	
  8

  
	
  4.7

  	
  Absence of Litigation

  	
  8

  
	
  4.8

  	
  Intellectual Property

  	
  8

  
	
  4.9

  	
  Tax Status

  	
  9

  
	
  4.10

  	
  Permits; Compliance

  	
  9

  
	
  4.11

  	
  Environmental Matters

  	
  10

  
	
  4.12

  	
  Title to Property

  	
  10

  
	
  4.13

  	
  No Investment Company or Real Property Holding Company

  	
  10

  
	
  4.14

  	
  No Brokers

  	
  11

  
	
  4.15

  	
  Registration Rights

  	
  11

  
	
  4.16

  	
  Exchange Act Registration

  	
  11

  
	
  4.17

  	
  Labor Relations

  	
  11

  
	
  4.18

  	
  Transactions with Affiliates and Employees

  	
  11

  
	
  4.19

  	
  Insurance

  	
  11

  
	
  4.20

  	
  Approved Acquisitions of Shares; No Anti-Takeover
  Provisions

  	
  11

  
	
  4.21

  	
  ERISA

  	
  12

  
	
  4.22

  	
  Disclosure

  	
  12

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5
  Covenants

  	
  12

  
	
   

  	
   

  	
   

  
	
  5.1

  	
  Form D; Blue Sky Laws

  	
  12

  
	
  5.2

  	
  Use of Proceeds

  	
  12

  
	
  5.3

  	
  Expenses

  	
  12

  
	
  5.4

  	
  No Integration

  	
  13

  
	
  5.5

  	
  Future Acquisitions

  	
  13

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6
  Conditions To The Company’s Obligation

  	
  13

  
	
   

  	
   

  
	
  6.1

  	
  Delivery of Transaction Documents

  	
  13

  
	
  6.2

  	
  Payment of Purchase Price

  	
  13

  
	
  6.3

  	
  Representations and Warranties

  	
  13

  
	
  6.4

  	
  Litigation

  	
  13

  

 

i

 

	
  6.5

  	
  No Prohibition

  	
  13

  
	
  6.6

  	
  Fairness Opinion

  	
  13

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7
  Conditions to The Buyer’s Obligation

  	
  14

  
	
   

  	
   

  
	
  7.1

  	
  Delivery of Transaction Documents; Issuance of Shares

  	
  14

  
	
  7.2

  	
  Representations and Warranties

  	
  14

  
	
  7.3

  	
  Consents

  	
  14

  
	
  7.4

  	
  Litigation

  	
  14

  
	
  7.5

  	
  Opinion

  	
  14

  
	
  7.6

  	
  No Material Adverse Change

  	
  14

  
	
  7.7

  	
  No Prohibition

  	
  14

  
	
  7.8

  	
  Fairness Opinion

  	
  14

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8 Termination

  	
  15

  
	
   

  	
   

  
	
  8.1

  	
  Termination Provisions

  	
  15

  
	
  8.2

  	
  Effect of Termination

  	
  15

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9 Indemnification

  	
  15

  
	
   

  	
   

  
	
  9.1

  	
  Indemnification by the Company

  	
  15

  
	
  9.2

  	
  Notification

  	
  15

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10
  Governing Law; Miscellaneous

  	
  16

  
	
   

  	
   

  
	
  10.1

  	
  Governing Law

  	
  16

  
	
  10.2

  	
  Counterparts; Electronic Signatures

  	
  16

  
	
  10.3

  	
  Headings

  	
  16

  
	
  10.4

  	
  Severability

  	
  16

  
	
  10.5

  	
  Entire Agreement; Amendments

  	
  17

  
	
  10.6

  	
  Notices

  	
  17

  
	
  10.7

  	
  Successors and Assigns

  	
  17

  
	
  10.8

  	
  Third Party Beneficiaries

  	
  18

  
	
  10.9

  	
  Publicity

  	
  18

  
	
  10.10

  	
  Further Assurances

  	
  18

  
	
  10.11

  	
  No Strict Construction

  	
  18

  
	
  10.12

  	
  Rights Cumulative

  	
  18

  
	
  10.13

  	
  Survival

  	
  18

  
	
  10.14

  	
  Knowledge

  	
  18

  

 

ii

 

Securities Purchase Agreement

 

This
SECURITIES PURCHASE AGREEMENT, dated as of April 22, 2008, is entered into
by and among BROADWIND ENERGY, INC., a Nevada corporation formerly known as
Tower Tech Holdings Inc. (the “Company”),
and Charles H. Beynon (the “Buyer”).

 

RECITALS:

 

A.            The
Buyer desire to provide financing to the Company and the Company desires to
obtain financing from the Buyer, upon the terms and conditions set forth in
this Agreement;

 

B.            The
total financing being provided by the Buyer to the Company hereunder shall
consist of the purchase by the Buyer of an aggregate of 62,814 shares (the “Shares”) of common stock, $0.001 par
value per share, at $7.96  per
share, for a total purchase price of approximately $500,000; and

 

C.            The
Company and the Buyer are executing and delivering this Agreement in reliance
upon the exemptions from securities registration afforded by Section 4(2) of
the 1933 Act and Rule 506.

 

AGREEMENT

 

NOW
THEREFORE, the Company and the Buyer hereby agree as follows:

 

ARTICLE 1

DEFINITIONS

 

“1933 Act”  means the Securities Act of
1933, as amended.

 

“1934 Act”  means the Securities
Exchange Act of 1934, as amended.

 

“2006-2008 SEC Documents” has the
meaning set forth in Section 3.2c.

 

“Action”  means any action, suit
claim, inquiry, notice of violation, proceeding (including any partial
proceeding such as a deposition) or investigation against or affecting the
Company, any of its Subsidiaries or any of their respective properties before
or by any court, arbitrator, governmental or administrative agency, regulatory
authority (federal, state, county, local or foreign), public board, stock
market, stock exchange or trading facility.

 

“Agreement”  means this Securities
Purchase Agreement.

 

“August 2007 Securities Purchase Agreement”
means that certain Securities Purchase Agreement dated August 22, 2007, by
and among the Company, TCP, TCOMF, T25, TOF and TP.

 

“Beynon  Registration Rights Agreement” means the Registration Rights Agreement in
the form attached hereto as Exhibit B.

 

“BF Registration Rights Agreement”
means that certain Registration Rights Agreement by and among the Company and
certain shareholders of Brad Foote Gear Works, Inc.

 

“Buyer”
has the meaning set forth in the preamble.

 

“Claim”
has the meaning set forth in Section 9.2.

 

1

 

“Closing”
has the meaning set forth in Section 2.22.

 

“Closing
Date” has the meaning set forth in Section 2.2.

 

“Code” has the meaning set forth in Section 4.13.

 

“Common
Stock”  means the
Company’s common stock, $0.001 par value per share.

 

“Company”
has the meaning set forth in the preamble.

 

“Consent”
means any approval, consent, ratification, waiver, or other authorization
(including any Governmental Authorization).

 

“EMS Registration Rights Agreement” means
that certain Registration Rights Agreement by and among the Company and the
members of Energy Maintenance Service, LLC.

 

“Environmental
Laws” has the meaning set forth in Section 4.11.

 

“ERISA” has the meaning set forth in Section 4.21.

 

“GAAP” has
the meaning set forth in Section 4.5.

 

“Governmental Authorization” means any approval, consent,
license, permit, waiver, or other authorization issued, granted, given, or
otherwise made available by or under the authority of any Governmental Body or
pursuant to any Legal Requirement.

 

“Governmental Body” means any: (a) nation, state,
province, county, city, town, village, district, or other jurisdiction of any
nature; (b) federal, state, provincial, local, municipal, foreign, or
other government; (c) governmental or quasi-governmental authority of any
nature (including any governmental agency, branch, department, official, or
entity and any court or other tribunal); (d) multi-national organization
or body; or (e) body exercising, or entitled to exercise, any administrative,
executive, judicial, legislative, police, regulatory, or taxing authority or
power of any nature.

 

“Hazardous
Materials” has the meaning set forth in Section 4.11.

 

“Indemnified Party” has the meaning set forth in Section 9.2.

 

“Initial
Securities Purchase Agreement” means that certain Securities
Purchase Agreement dated March 1, 2007 by and among the Company, TCP and
TCOMF.

 

“Intellectual
Property”  has the meaning
set forth in Section 4.8.

 

“Investment
Company”  has the meaning
set forth in Section 4.13.

 

“January 2008
Securities Purchase Agreement” means that certain Amended and
Restated Securities Purchase Agreement, dated January 3, 2008, by and
among TCP, TP, T25 and the Company.

 

“Legal
Requirement” means any federal, state, local, municipal,
foreign, international, multinational or other law, rule, regulation, order,
judgment, decree, ordinance, policy or directive, including those entered,
issued, made, rendered or required by any court, administrative or other
governmental body, agency or authority, or any arbitrator that has jurisdiction
over the Company or the Buyer.

 

2

 

“Material
Adverse Effect” means any material adverse
effect on the business, operations, assets, financial condition or prospects of
the Company.

 

“NRS” has the meaning set forth in Section 4.20.

 

“Per Share Price”
means $7.96 per Share.

 

“Permits” has the
meaning set forth in Section 4.10.

 

“Purchase
Price” has the meaning set forth in Section 2.21.

 

“Rule 506” means Rule 506
of Regulation D promulgated under the 1933 Act.

 

“SEC” means the
United States Securities and Exchange Commission.

 

“SEC
Documents”  has the meaning
set forth in Section 4.5.

 

“Shares” has the
meaning set forth in the Recitals.

 

“Subsidiaries”
means with respect to the Company, Tower Tech Systems, Inc, a
Wisconsin corporation, Brad Foote Gear Works, Inc., an Illinois
corporation, R. B. A. Inc., a Wisconsin corporation, and Energy Maintenance
Service, LLC, a Delaware limited liability company.

 

“T25” means Tontine 25 Overseas
Master Fund, L.P.

 

“TCOMF” means Tontine Capital
Overseas Master Fund, L.P.

 

“TCP” means Tontine Capital Partners,
L.P.

 

“TOF” means Tontine Overseas Fund,
Ltd.

 

“TP” means Tontine Partners, L.P.

 

“Tontine Registration Rights Agreement”  means the Registration Rights Agreement
dated March 1, 2007, by and among the Company, TCP, TCOMF, T25, TOF and
TP, as amended on October 19, 2007.

 

“Transaction
Documents” means this Agreement, the Beynon
Registration Rights Agreement and any other documents contemplated by this
Agreement.

 

ARTICLE 2

PURCHASE AND SALE OF SHARES

 

2.1           Purchase of Shares.  Subject to the terms and conditions of this
Agreement, the Company shall issue and sell to the Buyer, and the Buyer shall
purchase, at the Closing the number of Shares set forth in the recitals for the
Per Share Purchase Price and for an aggregate purchase price (the “Purchase Price”) to be paid by
the Buyer as set forth in the recitals.

 

2.2           Closing.  Subject to the conditions
set forth in Article 6 and Article 7 hereto, the
closing of the purchase of the Shares (the “Closing”) shall take place at the offices
of Fredrikson & Byron, 200 South Sixth Street, Suite 4000,
Minneapolis, Minnesota, 55402, on April 24, 2008, or at such other date 

 

3

 

and place as are mutually
agreeable to the Company and the Buyer purchasing Shares in the Closing.  The date of the Closing is hereafter referred
to as the “Closing Date.”  On the Closing Date, the
Buyer purchasing Shares in the Closing shall pay the Purchase Price by wire
transfer of immediately available funds in accordance with the Company’s
written instructions.  At the Closing,
upon payment of the Purchase Price, the Company will deliver written
instructions from the Company to the transfer agent for the Company’s Common
Stock to issue certificates representing the Shares purchased at the Closing
registered in the name of the Buyer purchasing such Shares and to deliver such
certificates to or at the direction of the Buyer.  The Company shall not have
the power to revoke or amend such transfer instructions without the written
consent of the Buyer.

 

ARTICLE 3

BUYER’S REPRESENTATIONS AND WARRANTIES

 

3.1           Intentionally Omitted.

 

3.2           Additional Representations
and Warranties.  The Buyer
hereby represents and warrants to the Company that:

 

a.     Authorization; Enforcement.  This Agreement and each of the other
Transaction Documents to be executed by the Buyer constitutes the valid and
binding agreement of the Buyer enforceable in accordance with its terms, except
as such enforceability may be limited by: 
(i) applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws in effect that limit creditors’ rights generally; (ii) equitable
limitations on the availability of specific remedies; and (iii) principles
of equity.

 

b.     Securities Matters.  In connection with the Company’s compliance
with applicable securities laws:

 

i.              The Buyer understands that
the Shares are being offered and sold to it or him in reliance upon specific
exemptions from the registration requirements of United States and state
securities laws and that the Company is relying upon the truth and accuracy of,
and the Buyer’s compliance with, the representations, warranties, agreements,
acknowledgments and understandings of the Buyer set forth herein in order to
determine the availability of such exemption and the eligibility of the Buyer
to acquire the Shares.

 

ii.             The Buyer is purchasing the
Shares for its or his own account, not as a nominee or agent, for investment
purposes and not with a present view towards resale, except pursuant to sales
exempted from registration under the 1933 Act, or registered under the 1933
Act.

 

iii.            The Buyer is an “accredited
investor” as that term is defined in Rule 501(a) of Regulation D
under the 1933 Act, and has such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of an
investment in the Shares.  The Buyer
understands that its or his investment in the Shares involves a significant
degree of risk and that, except as set forth in this Agreement, the Company has
made no representations or assurances concerning the present or prospective
value of the Shares being purchased hereunder. 
The Buyer understands that no United States federal or state agency or
any other government or governmental agency has passed upon or made any
recommendation or endorsement of the Shares.

 

4

 

c.     Information.  The Buyer has conducted its or his own due
diligence examination of the Company’s business, financial condition, results
of operations, and prospects.  In
connection with such investigation, the Buyer and its or his representatives (i) have
reviewed the Company’s Form 10-KSB for the fiscal years ended December 31,
2006 and December 31, 2007 and the Company’s Current Reports on Form 8-K
or Form 8-K/A filed in 2006, 2007 and 2008 (and all exhibits included
therein and financial statements and schedules thereto and documents (other
than exhibits to such documents) incorporated by reference therein, being
hereinafter referred to herein as the “2006-2008
SEC Documents”), (ii) have been given an opportunity to ask
questions, to the extent the Buyer considered necessary, and have received
answers from, officers of the Company concerning the business, finances and
operations of the Company and information relating to the offer and sale of the
Shares, and (iii) have received or had an opportunity to obtain such
additional information as they deem necessary to make an informed investment
decision with respect to the purchase of the Shares.

 

d.     Restrictions on Transfer.  The Buyer understands that, except as
provided in any registration rights agreement to which Buyer is a party, the
issuance of the Shares has not been and is not being registered under the 1933
Act or any applicable state securities laws. The Buyer may be required to hold
the Shares indefinitely and the Shares may not be transferred unless (i) the
Shares are sold pursuant to an effective registration statement under the 1933
Act, or (ii) the Buyer shall have delivered to the Company an opinion of
counsel to the effect that the Shares to be sold or transferred may be sold or
transferred pursuant to an exemption from such registration, which opinion
shall be reasonably acceptable to the Company. The Buyer understands that until
such time as the resale of the Shares has been registered under the 1933 Act or
may be sold pursuant to an exemption from registration, certificates evidencing
the Shares may bear a restrictive legend in substantially the following form
(and a stop-transfer order may be placed against transfer of the certificates
evidencing such Shares):

 

“THE SHARES REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”).  THE SHARES MAY NOT BE OFFERED FOR SALE,
SOLD, OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT, OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER
THE ACT, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF
THE CORPORATION.”

 

e.     Consents.  Except as set forth in this Agreement, no
Buyer will be required to obtain any Consent from any person or entity in
connection with the execution and delivery of this Agreement or the
consummation or performance of any of the transactions contemplated hereby.

 

ARTICLE 4

REPRESENTATIONS AND WARRANTIES OF THE
COMPANY

 

Except
as set forth in the Company’s Disclosure Schedule attached hereto, the Company
represents and warrants to the Buyer that:

 

4.1           Organization and
Qualification.  The Company
has no subsidiaries other than the Subsidiaries.  The Company and each of its Subsidiaries is a
corporation, limited partnership, limited liability company, or joint venture
as applicable, duly organized, validly existing and in good standing under the
laws of the jurisdiction in which it is incorporated or organized, with
corporate, limited liability or limited partnership power and authority to own,
lease, use and operate its properties and to carry on its business as now
operated and conducted.  Except as set
forth on Schedule 4.1, the Company and each of its Subsidiaries is duly
qualified as a foreign corporation, limited liability company or limited
partnership 

 

5

 

to do business and is in
good standing in each jurisdiction in which its ownership or use of property or
the nature of the business conducted by it makes such qualification necessary,
except where the failure to be so qualified or in good standing would not have
a Material Adverse Effect.  Neither the
Company nor any Subsidiary is in violation of any provision of its respective
certificate or articles of incorporation, partnership agreement, bylaws or
other organizational or charter documents, as the same may have been amended.

 

4.2           Authorization; Enforcement.  The Company has all requisite corporate power
and authority to enter into and perform this Agreement and each of the other
Transaction Documents and to consummate the transactions contemplated hereby
and thereby and to issue the Shares, in accordance with the terms hereof and
thereof.  The execution and delivery of
this Agreement and each of the other Transaction Documents by the Company and
the consummation by it of the transactions contemplated hereby and thereby
(including without limitation, the issuance of the Shares) have been duly
authorized by the Company’s Board of Directors and no further consent or
authorization of the Company, its Board of Directors, or its stockholders is
required.  This Agreement and each of the
other Transaction Documents have been duly executed and delivered by the
Company.  This Agreement and each of the
other Transaction Documents will constitute upon execution and delivery by the
Company, a legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms, except as such enforceability
may be limited by:  (i) applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws in
effect that limit creditors’ rights generally; (ii) equitable limitations
on the availability of specific remedies; (iii) principles of equity
(regardless of whether such enforcement is considered in a proceeding in law or
in equity); and (iv) to the extent rights to indemnification and
contribution may be limited by federal securities laws or the public policy
underlying such laws.

 

4.3           Capitalization; Valid
Issuance of Shares.  As of the
date hereof, the authorized capital stock of the Company consists of
100,000,000 shares of Common Stock, of which 79,936,996  shares are issued and outstanding, and no
shares are held by the Company as treasury shares, and 10,000,000 shares of
preferred stock, of which no shares are issued and outstanding.  All of such outstanding shares of Common
Stock are duly authorized, validly issued, fully paid and nonassessable.  The Shares have been duly authorized and when
issued pursuant to the terms hereof will be validly issued, fully paid and
nonassessable and will not be subject to any encumbrances, preemptive rights or
any other similar contractual rights of the stockholders of the Company or any
other person.  No shares of capital stock
of the Company are subject to preemptive rights of the stockholders of the Company
or any liens or encumbrances imposed through the actions or failure to act of
the Company.  As of the date of this
Agreement, except as described in Schedule 4.3 attached hereto, (i) there
are no outstanding options, warrants, scrip, rights to subscribe for, puts,
calls, rights of first refusal, agreements, understandings, claims or other
commitments or rights of any character whatsoever relating to, or securities or
rights convertible into or exchangeable for any shares of capital stock of the
Company or any of its Subsidiaries, or arrangements by which the Company or any
of its Subsidiaries is or may become bound to issue additional shares of
capital stock, (ii) there are no agreements or arrangements under which
the Company or any of its Subsidiaries is obligated to register the sale of any
of its or their securities under the 1933 Act (except the Beynon Registration
Rights Agreement, the BF Registration Rights Agreement, the EMS Registration
Rights Agreement and the Tontine Registration Rights Agreement) and (iii) there
are no anti-dilution or price adjustment provisions contained in any security
issued by the Company (or in any agreement providing rights to security holders
other than the Initial Securities Purchase Agreement, the August 2007
Securities Purchase Agreement and the January 2008 Securities Purchase
Agreement) that will be triggered by the issuance of the Shares.  Except as may be described in any documents
which have been publicly filed by any of the Company’s stockholders, to the
Company’s knowledge, there are no agreements between the Company’s stockholders
with respect to the voting or transfer of the Company’s capital stock or with
respect to any other aspect of the Company’s affairs.

 

6

 

4.4           No Conflicts.  The execution, delivery and performance of
this Agreement and each of the other Transaction Documents by the Company and
the consummation by the Company of the transactions contemplated hereby and
thereby (including, without limitation, the issuance of Shares) will not (i) conflict
with or result in a violation of any provision of the Articles of
Incorporation, as amended, of the Company or the Bylaws, as amended, of the
Company, (ii) violate or conflict with, or result in a breach of any
provision of, or constitute a default (or an event which with notice or lapse
of time or both could become a default) under, or give to others any rights of
termination, amendment, acceleration or cancellation of, any material
agreement, indenture, patent, patent license or instrument to which the Company
or any of its Subsidiaries is a party, or (iii) result in a violation of
any Legal Requirement (including federal and state securities laws and
regulations and regulations of any self-regulatory organizations to which the
Company or its securities are subject) applicable to the Company or any of its
Subsidiaries or by which any property or asset of the Company or any of its
Subsidiaries is bound or affected (except for such conflicts, defaults, terminations,
amendments, accelerations, cancellations and violations as would not,
individually or in the aggregate, have a Material Adverse Effect).  Except as set forth in Schedule 4.4,
neither the Company nor any of its Subsidiaries is in violation of its certificate
or articles of incorporation, bylaws or other organizational documents and
neither the Company nor any of its Subsidiaries is in default (and no event has
occurred which with notice or lapse of time would result in a default) under,
and neither the Company nor any of its Subsidiaries has taken any action or
failed to take any action that would give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement or instrument to
which the Company or any of its Subsidiaries is a party or by which any
property or assets of the Company or any of its Subsidiaries is bound or
affected, except for possible defaults as would not, individually or in the
aggregate, have a Material Adverse Effect. 
Except with respect to any filings or notices related to the issuance of
the Shares to be filed with the OTC Bulletin Board, if any, and as required
under the 1933 Act and any applicable state securities laws, the Company is not
required to obtain any consent, authorization or order of, or make any filing
or registration with, any court, governmental agency, regulatory agency, self
regulatory organization or stock market or any third party in order for it to
execute, deliver or perform any of its obligations under the Transaction Documents.  All consents, authorizations, orders, filings
and registrations that the Company is required to effect or obtain pursuant to
the preceding sentence have been obtained or effected on or prior to the date
hereof.

 

4.5           SEC Documents;
Financial Statements.

 

a.     Except as set forth on Schedule
4.5, since December 31, 2006, the Company has timely filed all
reports, schedules, forms, statements and other documents required to be filed
by it with the SEC pursuant to the reporting requirements of the 1933 Act and
the 1934 Act (all of the foregoing filed prior to the date hereof and all
exhibits included therein and financial statements and schedules thereto and
documents (other than exhibits to such documents) incorporated by reference
therein, being hereinafter referred to herein as the “SEC Documents”), or has timely filed for a valid
extension of such time of filing and has filed any such SEC Documents prior to
the expiration of any such extension.  As
of their respective dates, the SEC Documents complied in all material respects
with the requirements of the Securities Act and the Exchange Act and the rules and
regulations of the SEC promulgated thereunder applicable to the SEC Documents,
and none of the SEC Documents, at the time they were filed with the SEC, contained
any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, except as subsequently disclosed in later-filed SEC Documents.

 

b.     As of their respective
dates, the financial statements of the Company included in the SEC Documents
complied as to form in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC with
respect thereto.  Such financial
statements have been prepared in accordance with United States generally
accepted accounting principles (“GAAP”),
consistently applied, during the periods involved (except (i) as may be
otherwise indicated in such 

 

7

 

financial statements or the
notes thereto, or (ii) in the case of unaudited interim statements, to the
extent they may not include footnotes, year end adjustments or may be condensed
or summary statements) and fairly present in all material respects the
consolidated financial position of the Company and its consolidated
Subsidiaries as of the dates thereof and the consolidated results of their
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal year-end audit adjustments).  Except as set forth in the financial
statements of the Company included in the SEC Documents, the Company has no
liabilities, contingent or otherwise, other than (i) liabilities incurred
in the ordinary course of business subsequent to December 31, 2007, and (ii) obligations
under contracts and commitments incurred in the ordinary course of business and
not required under generally accepted accounting principles to be reflected in
such financial statements, which, individually or taken in the aggregate would
not reasonably be expected to have a Material Adverse Effect.

 

c.     The Company has established
and maintains disclosure controls and procedures (as such term is defined in Rule 13a-15(e) under
the 1934 Act).  Such disclosure controls
and procedures:  (A) are designed to
ensure that material information relating to the Company and its Subsidiaries
is made known to the Company’s chief executive officer, president, chief
operating officer and its chief financial officer by others within those
entities, particularly during the periods in which the Company’s reports and
filings under the 1934 Act are being prepared, (B) have been evaluated for
effectiveness as of the end of the most recent annual period reported to the
SEC, and (C) are effective to perform the functions for which they were
established.  Except as set forth on Schedule
4.5, neither the auditors of the Company nor the Board of Directors of the
Company has been advised of: (x) any significant deficiencies or material
weaknesses in the design or operation of the internal controls over financial
reporting (as such term is defined in Rule 13a-15(f) under the 1934
Act) of the Company that have materially affected the Company’s internal
control over financial reporting; or (y) any fraud, whether or not
material, that involves management or other employees who have a role in the
internal controls over financial reporting of the Company.

 

4.6           Absence of Certain Changes.  Except with respect to transactions disclosed
in the SEC Documents, and the transactions contemplated hereby and by each of
the other Transaction Documents, since December 31, 2007, (i) the
Company and each of its Subsidiaries has conducted its business only in the
ordinary course, consistent with past practice, and since that date, no changes
have occurred which would reasonably be expected to have a Material Adverse
Effect; and (ii) the Company has not incurred any liabilities (contingent
or otherwise) other than (A) trade payables, accrued expenses and other
liabilities incurred in the ordinary course of business consistent with past
practice and (B) liabilities not required to be reflected on the Company’s
financial statements pursuant to GAAP or required to be disclosed in filings
made with the SEC.

 

4.7           Absence of Litigation.  Except as set forth in Schedule 4.7,
there is no Action pending or, to the knowledge of the Company or any of its
Subsidiaries, threatened against or affecting the Company or any of its
Subsidiaries that (i) adversely affects or challenges the legality,
validity or enforceability of this Agreement, or (ii) would, if there were
an unfavorable decision, have or reasonably be expected to have a Material
Adverse Effect.  Neither the Company nor
any of its Subsidiaries, nor any director or officer thereof (in his or her
capacity as such), is or has been the subject of any Action involving a claim
of violation of or liability under federal or state securities laws or a claim
of breach of fiduciary duty.  There has
not been, and to the knowledge of the Company, there is not pending any
investigation by the SEC involving the Company or any current or former
director or officer of the Company (in his or her capacity as such).  The SEC has not issued any stop order or
other order suspending the effectiveness of any registration statement filed by
the Company under the 1934 Act or the 1933 Act.

 

4.8           Intellectual Property.  The Company and each of its Subsidiaries owns
or possesses the requisite licenses or rights to use all patents, patent
applications, patent rights, inventions, know-how, 

 

8

 

trade secrets, copyrights,
trademarks, trademark applications, service marks, service names, trade names
and copyrights (“Intellectual
Property”) necessary to enable it to conduct its business as now
operated (and, to the Company’s knowledge, as presently contemplated to be
operated in the future); there is no claim or Action by any person pertaining
to, or proceeding pending, or to the Company’s knowledge threatened, which
challenges the right of the Company or of a Subsidiary with respect to any
Intellectual Property necessary to enable it to conduct its business as now
operated and to the Company’s knowledge, the Company’s or its Subsidiaries’
current products and processes do not infringe on any Intellectual Property or
other rights held by any person, except where any such infringement would not
reasonably be expected to have a Material Adverse Effect.

 

4.9           Tax Status.  The Company and each of its Subsidiaries has
made or filed all federal, state and foreign income and all other material tax
returns, reports and declarations required by any jurisdiction to which it is
subject (unless and only to the extent that the Company and each of its
Subsidiaries has set aside on its books provisions reasonably adequate for the
payment of all unpaid and unreported taxes) and has paid all taxes and other
governmental assessments and charges that are material in amount, shown or
determined to be due on such returns, reports and declarations, except those
being contested in good faith and has set aside on its books provisions
reasonably adequate for the payment of all taxes for periods subsequent to the periods
to which such returns, reports or declarations apply.  There are no unpaid taxes in any material
amount claimed to be due by the taxing authority of any jurisdiction, and the
officers of the Company know of no basis for any such claim.  The Company has not executed a waiver with
respect to the statute of limitations relating to the assessment or collection
of any foreign, federal, state or local tax.

 

4.10         Permits;
Compliance.

 

a.     The Company and each of its
Subsidiaries is in possession of all franchises, grants, authorizations,
licenses, permits, easements, variances, exemptions, consents, certificates,
approvals and orders necessary to own, lease and operate its properties and to
carry on its business as it is now being conducted (collectively, “Permits”), and there is no
Action pending or, to the knowledge of the Company, threatened regarding
suspension or cancellation of any of the Permits.  Neither the Company nor any of its
Subsidiaries is in conflict with, or in default or violation of, any of the
Permits, except for any such conflicts, defaults or violations which,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect.

 

b.     Since December 31,
2007, no event has occurred or, to the knowledge of the Company, circumstance
exists that (with or without notice or lapse of time): (a) would
reasonably be expected to constitute or result in a violation by the Company or
any of its Subsidiaries, or a failure on the part of the Company or its
Subsidiaries to comply with, any Legal Requirement; or (b) would
reasonably be expected to give rise to any obligation on the part of the
Company or any of its Subsidiaries to undertake, or to bear all or any portion
of the cost of, any remedial action of any nature in connection with a failure
to comply with any Legal Requirement, except in either case that would not
reasonably be expected to have a Material Adverse Effect.  Neither the Company nor any of its
Subsidiaries has received any notice or other communication from any regulatory
authority or any other person, nor does the Company have any knowledge
regarding: (x) any actual, alleged, possible or potential violation of, or
failure to comply with, any Legal Requirement, or (y) any actual, alleged,
possible or potential obligation on the part of the Company or any of its
Subsidiaries to undertake, or to bear all or any portion of the cost of, any
remedial action of any nature in connection with a failure to comply with any
Legal Requirement, except in either case that would not reasonably be expected
to have a Material Adverse Effect.

 

c.     Intentionally omitted.

 

9

 

d.     The Company is, and has
reason to believe that for the foreseeable future it will continue to be, in
compliance with all applicable rules of the OTC Bulletin Board.  The Company has not received notice from the
OTC Bulletin Board that the Company is not in compliance with the rules or
requirements thereof.  The issuance and
sale of the Shares under this Agreement do not contravene the rules and
regulations of the OTC Bulletin Board, and no approval of the stockholders of
the Company is required for the Company to issue the Shares as contemplated by
this Agreement.

 

4.11         Environmental Matters.  “Environmental Laws” shall mean, collectively,
all Legal Requirements, including any federal, state, local or foreign statute,
laws, rule, regulation, ordinance, code, policy or rule of common law or
any judicial or administrative interpretation thereof, including any judicial
or administrative order, consent, decree or judgment, relating to pollution or
protection of human health, the environment (including, without limitation,
ambient air, surface water, groundwater, land surface or subsurface strata) or
wildlife, including, without limitation, laws and regulations relating to the
release or threatened release of chemicals, pollutants, contaminants, wastes,
toxic substances, hazardous substances, petroleum or petroleum products
(collectively, “Hazardous
Materials”) or to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous
Materials.  Except for such matters as
could not, singly or in the aggregate, reasonably be expected to result in a
Material Adverse Effect or as set forth on Schedule 4.11: (i) the
Company and its Subsidiaries have complied and are in compliance with all
applicable Environmental Laws; (ii) without limiting the generality of the
foregoing, the Company and its Subsidiaries have obtained, have complied, and
are in compliance with all Permits that are required pursuant to Environmental
Laws for the occupation of their respective facilities and the operation of
their respective businesses; (iii) none of the Company or its Subsidiaries
has received any written notice, report or other information regarding any
actual or alleged violation of Environmental Laws, or any liabilities or
potential liabilities (including fines, penalties, costs and expenses),
including any investigatory, remedial or corrective obligations, relating to
any of them or their respective facilities arising under Environmental Laws,
nor, to the knowledge of the Company is there any factual basis therefore; (iv) there
are no underground storage tanks, polychlorinated biphenyls, urea formaldehyde
or other hazardous substances (other than small quantities of hazardous
substances for use in the ordinary course of the operation of the Company’s and
its Subsidiaries’ respective businesses, which are stored and maintained in
accordance and in compliance with all applicable Environmental Laws), in, on,
over, under or at any real property owned or operated by the Company and/or its
Subsidiaries; (v) there are no conditions existing at any real property or
with respect to the Company or any of its Subsidiaries that require remedial or
corrective action, removal, monitoring or closure pursuant to the Environmental
Laws and (vi) to the knowledge of the Company, neither the Company nor any
of its Subsidiaries has contractually, by operation of law, or otherwise
amended or succeeded to any liabilities arising under any Environmental Laws of
any predecessors or any other Person.

 

4.12         Title to Property.  Except for any lien for current taxes not yet
delinquent or which are being contested in good faith and by appropriate
proceedings, the Company and its Subsidiaries have good and marketable title to
all real property and all personal property owned by them which is material to
the business of the Company and its Subsidiaries.  Any leases of real property and facilities of
the Company and its Subsidiaries are valid and effective in accordance with
their respective terms, except as would not have a Material Adverse Effect.

 

4.13         No Investment Company or
Real Property Holding Company.  The Company is not, and upon the issuance and
sale of the Shares as contemplated by this Agreement will not be, an “investment
company” as defined under the Investment Company Act of 1940 (“Investment Company”).  The Company is not controlled by an
Investment Company.  The Company is not a
United States real property holding company, as defined under the Internal
Revenue Code of 1986, as amended (the “Code”).

 

10

 

4.14         No Brokers.  The Company has taken no action which would
give rise to any claim by any person for brokerage commissions, transaction
fees or similar payments relating to this Agreement or the transactions
contemplated hereby.

 

4.15         Registration Rights.  Except pursuant to the Beynon Registration
Rights Agreement, the BF Registration Rights Agreement, the EMS Registration
Rights Agreement and the Tontine Registration Rights Agreement, neither the
Company nor any Subsidiary is currently subject to any agreement providing any
person or entity any rights (including piggyback registration rights) to have
any securities of the Company or any Subsidiary registered with the SEC or
registered or qualified with any other governmental authority.

 

4.16         Exchange Act Registration.  The Common Stock is registered pursuant to Section 12(b) of
the 1934 Act, and the Company has taken no action designed to, or which, to the
knowledge of the Company, is likely to have the effect of, delisting the
registration of the Common Stock under the 1934 Act.

 

4.17         Labor Relations.  No labor or employment dispute exists or, to
the knowledge of the Company, is imminent or threatened, with respect to any of
the employees of the Company that has, or could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.

 

4.18         Transactions with Affiliates
and Employees.  Except as
set forth in the SEC Documents, and Schedule 4.18, none of the officers
or directors of the Company, and to the knowledge of the Company, none of the
employees of the Company, is presently a party to any transaction or agreement
with the Company (other than for services as employees, officers and directors)
exceeding $60,000, including any contract, agreement or other arrangement providing
for the furnishing of services to or by, providing for rental of real or
personal property to or from, or otherwise requiring payments to or from any
officer, director or such employee or, to the knowledge of the Company, any
entity in which any officer, director, or any such employee has a substantial
interest or is an officer, director, trustee or partner.

 

4.19         Insurance.  The Company and its Subsidiaries have
insurance policies in full force and effect of a type, covering such risks and
in such amounts, and having such deductibles and exclusions as are customary
for conducting businesses and owning assets similar in nature and scope to
those of the Company and its Subsidiaries. 
The amounts of all such insurance policies and the risks covered thereby
are in accordance in all material respects with all material contracts and
agreements to which the Company and/or its Subsidiaries is a party and with all
applicable Legal Requirements.  With
respect to each such insurance policy:  (i) the
policy is valid, outstanding and enforceable in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws in effect that
limit creditors’ rights generally, equitable limitations on the availability of
specific remedies and principles of equity (regardless of whether such
enforcement is considered in a proceeding in law or in equity); (ii) neither
the Company nor any of its Subsidiaries is in breach or default with respect to
its obligations thereunder in any material respect; and (iii) no party to
the policy has repudiated, or given notice of an intent to repudiate, any
provision thereof.

 

4.20         Approved Acquisitions of
Shares; No Anti-Takeover Provisions.  Except as otherwise set forth in Schedule
4.2, the Company has taken all necessary action, if any, required under the
laws of the State of Nevada or otherwise to allow the Buyer to acquire the Shares pursuant to
this Agreement.  The Company has no
control share acquisition, business combination, poison pill (including any
distribution under a rights agreement) or other similar anti-takeover provision
under the Company’s Articles of Incorporation or Bylaws, each as amended (or
similar charter documents), that is or could become applicable to the Buyer as
a result of the Buyer and the Company fulfilling their obligations or
exercising 

 

11

 

their rights under this
Agreement, including without limitation the Company’s issuance of the Shares to the
Buyer and the Buyer’s ownership of the Shares.  In addition, the Company has opted out of the
provisions of the Nevada Revised Statutes (“NRS”) pertaining to the acquisition of a
controlling interest (NRS 78.378 through 78.3793).  As of the date hereof, the Company had less
than 200 “stockholders of record” and is not considered a “resident domestic
corporation” for purposes of §78.411 through §78.444 of the NRS.

 

4.21         ERISA.  Based upon the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”), and the regulations and published
interpretations thereunder: (i) neither the Company nor any of its
Subsidiaries has engaged in any Prohibited Transactions (as defined in Section 406
of ERISA and Section 4975 of the Code); (ii) the Company and each of
its Subsidiaries has met all applicable minimum funding requirements under Section 302
of ERISA in respect to its plans; (iii) neither the Company nor any of its
Subsidiaries has any knowledge of any event or occurrence which would cause the
Pension Benefit Guaranty Corporation to institute proceedings under Title IV of
ERISA to terminate any employee benefit plan(s); neither the Company nor any of
its Subsidiaries has any fiduciary responsibility for investments with respect
to any plan existing for the benefit of persons other than its or such
Subsidiary’s employees; and (v) neither the Company nor any of its
Subsidiaries has withdrawn, completely or partially, from any multi-employer
pension plan so as to incur liability under the Multiemployer Pension Plan
Amendments Act of 1980.

 

4.22         Disclosure.  The Company understands and confirms that the
Buyer will rely on the representations and covenants contained herein in
effecting the transactions contemplated by this Agreement and the other
Transaction Documents.  All
representations and warranties provided to the Buyer including the disclosures
in the Company’s disclosure schedules attached hereto furnished by or on behalf
of the Company, taken as a whole are true and correct and do not contain any
untrue statement of material fact or omit to state any material fact necessary
in order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading. 
No event or circumstance has occurred or information exists with respect
to the Company or its Subsidiaries or its or their businesses, properties,
prospects, operations or financial conditions, which, under applicable law, rule or
regulation, requires public disclosure or announcement by the Company but which
has not been so publicly announced or disclosed.

 

ARTICLE 5

COVENANTS

 

5.1           Form D; Blue Sky Laws.  Upon completion of the Closing, the Company
shall file with the SEC a Form D with respect to the Shares as required
under Regulation D and each applicable state securities commission and will
provide a copy thereof to the Buyer promptly after such filing.

 

5.2           Use of Proceeds.  The Company shall use the proceeds from the
sale of the Shares for general working capital requirements, capital expansion
projects and to finance potential acquisitions by the Company.

 

5.3           Expenses.  The Company shall reimburse the Buyer for all
reasonable expenses including, without limitation, reasonable attorneys’ fees
and expenses, and out-of-pocket travel costs and expenses, incurred by them in
connection with (a) their due diligence review of the Company and any
target of any acquisition that the Company may make, which acquisition is at
least partially financed by the sale of the Shares, and (b) the
negotiation, preparation, execution, delivery and performance of this Agreement
and the other Transaction Documents and the transactions hereunder and
thereunder.

 

12

 

5.4           No Integration.  The Company shall not make any offers or
sales of any security (other than the Shares) under circumstances that would
require registration of the Shares being offered or sold hereunder under the
1933 Act or cause the offering of the Shares to be integrated with any other
offering of securities by the Company in such a manner as would require the
Company to seek the approval of its stockholders for the issuance of the Shares
under any stockholder approval provision applicable to the Company or its
securities.

 

5.5           Future Acquisitions.  The Company shall not revoke its approval of
the acquisition of the Shares by the Buyer. 
The Company shall use its best efforts to ensure that the acquisition of
the Shares by the Buyer shall not be made subject to the provisions of any
anti-takeover laws and regulations of any governmental authority, including
without limitation, the applicable provisions of the Nevada Revised Statutes,
and any provisions of an anti-takeover nature adopted by the Company or any of
its Subsidiaries or contained in the Company’s Articles of Incorporation,
Bylaws, or the organizational documents of any of its Subsidiaries, each as
amended.

 

ARTICLE 6

CONDITIONS TO THE COMPANY’S OBLIGATION

 

The
obligation of the Company hereunder to issue and sell the Shares to the Buyer
at the Closing is subject to the satisfaction, at or before the Closing Date,
of each of the following conditions thereto (except as otherwise noted
therein), provided that these conditions are for the Company’s sole benefit and
may be waived by the Company at any time in its sole discretion:

 

6.1           Delivery of Transaction
Documents.  The Buyer
shall have executed and delivered the Transaction Documents to which they are a
party to the Company.

 

6.2           Payment of Purchase Price.  The Buyer shall have delivered the  Purchase Price in accordance with Section 2.22.

 

6.3           Representations and
Warranties.  The
representations and warranties of the Buyer shall be true and correct in all
material respects (provided, however, that such qualification shall only apply
to representations or warranties not otherwise qualified by materiality) as of
the date when made and as of the Closing Date as though made at that time
(except for representations and warranties that speak as of a specific date),
and the Buyer shall have performed, satisfied and complied in all material
respects with the covenants, agreements and conditions required by this
Agreement to be performed, satisfied or complied with by the Buyer at or prior
to the Closing Date.

 

6.4           Litigation.  No litigation, statute, rule, regulation,
executive order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by or in any court or governmental authority of
competent jurisdiction or any self-regulatory organization having authority
over the matters contemplated hereby which prohibits the consummation of any of
the transactions contemplated by this Agreement.

 

6.5           No
Prohibition.  Neither the consummation nor
the performance of the acquisition of the Shares by the Buyer will materially
contravene, or conflict with, or result in a material violation of (a) any
applicable Legal Requirement, or (b) any Legal Requirement that has been
published, introduced, or otherwise proposed by or before any Governmental
Body.

 

6.6           Fairness
Opinion.  The Company shall have received a written
opinion from a reputable third party financial advisor reasonably satisfactory
to the Company and the Buyer with respect to the fairness from a financial
point of view to the Company’s shareholders of the Per Share Purchase Price.

 

13

 

ARTICLE 7

CONDITIONS TO THE BUYER’S OBLIGATION

 

The
obligation of the Buyer hereunder to purchase the Shares at the Closing is
subject to the satisfaction, at or before the Closing Date, of each of the following
conditions (except as otherwise noted therein), provided that these conditions
are for the Buyer’s sole benefit and may be waived by the Buyer at any time in
his sole discretion:

 

7.1           Delivery of Transaction
Documents; Issuance of Shares.  The Company shall have executed and delivered
the Transaction Documents to the Buyer and shall deliver the transfer
instructions to the transfer agent for the Company’s Common Stock to issue
certificates in the name of the Buyer representing the Shares being purchased
by the Buyer.  The Company shall deliver
a copy of the transfer instructions to the Buyer at the Closing.

 

7.2           Representations and
Warranties.  The
representations and warranties of the Company shall be true and correct in all
material respects (provided, however, that such qualification shall only apply
to representations or warranties not otherwise qualified by materiality) as of
the date when made and as of the Closing Date as though made at such time
(except for representations and warranties that speak as of a specific date)
and the Company shall have performed, satisfied and complied in all material
respects with the covenants, agreements and conditions required by this
Agreement to be performed, satisfied or complied with by the Company at or prior
to the Closing Date.

 

7.3           Consents.  Any consents or
approvals required to be secured by the Company for the consummation of the
transactions contemplated by the Transaction Documents shall have been obtained
and shall be reasonably satisfactory to the Buyer.

 

7.4           Litigation.  No Action shall have been enacted, entered,
promulgated or endorsed by or in any court or governmental authority of
competent jurisdiction or any self-regulatory organization having authority
over the matters contemplated hereby which prohibits the consummation of any of
the transactions contemplated by this Agreement.

 

7.5           Opinion.  The Buyer shall have received an opinion of
the Company’s counsel dated as of the Closing Date with respect to the issuance
and sale of the Shares at the Closing, in form, scope and substance reasonably
satisfactory to the Buyer with respect to the matters set forth in Exhibit A
attached hereto.

 

7.6           No Material Adverse Change.  There shall have been no material adverse
change in the assets, liabilities (contingent or otherwise), affairs, business,
operations, prospects or condition (financial or otherwise) of the Company
prior to the Closing Date.

 

7.7           No
Prohibition.  Neither the consummation nor
the performance of the acquisition of the Shares by the Buyer hereunder will
materially contravene, or conflict with, or result in a material violation of (a) any
applicable Legal Requirement, or (b) any Legal Requirement that has been
published, introduced, or otherwise proposed by or before any Governmental Body.

 

7.8           Fairness
Opinion.  The Company shall have received a written
opinion from a reputable third party financial advisor reasonably satisfactory
to the Company and the Buyer with respect to the fairness from a financial
point of view to the Company’s shareholders of the Per Share Purchase Price.

 

14

 

ARTICLE 8

TERMINATION

 

8.1           Termination
Provisions. 
This Agreement may be terminated at any time before the Closing Date:

 

a.     By mutual
consent of the Company and the Buyer;

 

b.     By either
the Company or the Buyer, as applicable, in the event that any of the
conditions precedent to their respective obligations to consummate the
transactions contemplated hereby as set forth in Article 6 or Article 7,
through no fault of the terminating party, have not been met and satisfied and
have become impossible of fulfillment;

 

c.     By either
the Company or the Buyer if the Closing does not occur by May 31, 2008  or such later date as the Company and the
Buyer may mutually agree upon (provided that the terminating party is not then
in material breach of any representation, warranty, covenant or other agreement
contained herein);

 

d.     By the
Buyer if there has been any material breach of any representation, warranty,
agreement or covenant in this Agreement by the Company, which breach cannot be
or has not been cured within thirty (30) days after giving written notice
thereof to the Company; and

 

e.     By the
Company if there has been any material breach of any representation, warranty,
agreement or covenant in this Agreement by any of the Buyer, which breach
cannot be or has not been cured within thirty (30) days after giving written
notice thereof to the Buyer.

 

8.2           Effect of
Termination. 
Upon the termination of this Agreement pursuant to the terms hereof,
this Agreement will be void and neither party will have any further liability
obligations with respect hereof, except as otherwise provided in this Agreement
or except and to the extent termination results from the intentional breach by
a party of any of its representations, warranties or covenants hereunder.

 

ARTICLE 9

INDEMNIFICATION

 

9.1           Indemnification by the
Company.   The Company agrees to
indemnify the Buyer and its affiliates and hold the Buyer and its affiliates
harmless from and against any and all liabilities, losses, damages, costs and
expenses of any kind (including, without limitation, the reasonable fees and
disbursements of the Buyer’s counsel in connection with any investigative,
administrative or judicial proceeding), which may be incurred by the Buyer or
such affiliates as a result of any claims made against the Buyer or such
affiliates by any person that relate to or arise out of (i) any breach by
the Company of any of its representations, warranties or covenants contained in
this Agreement or in the Transaction Documents (other than the Beynon
Registration Rights Agreement, which contains separate indemnification
provisions), or (ii) any litigation, investigation or proceeding
instituted by any person with respect to this Agreement or the Shares
(excluding, however, any such litigation, investigation or proceeding which
arises solely from the acts or omissions of the Buyer or its affiliates).

 

9.2           Notification.  Any person entitled to
indemnification hereunder (“Indemnified Party”) will (i) give prompt notice to
the Company, of any third party claim, action or suit with respect to which it
seeks indemnification (the “Claim”) (but omission of such notice shall not relieve
the Company from liability hereunder except to the extent it is actually
prejudiced by such failure to give notice), specifying

 

15

 

in reasonable detail the
factual basis for the Claim, the amount thereof, estimated in good faith, and
the method of computation of the Claim, all with reasonable particularity and
containing a reference to the provisions of this Agreement in respect of which
such indemnification is sought with respect to the Claim, and (ii) unless
in such Indemnified Party’s reasonable judgment a conflict of interest may
exist between such Indemnified Party and the Company with respect to such
claim, permit the Company to assume the defense of the Claim with counsel
reasonably satisfactory to the Indemnified Party.  The Indemnified Party shall cooperate fully
with the Company with respect to the defense of the Claim and, if the Company
elects to assume control of the defense of the Claim, the Indemnified Party
shall have the right to participate in the defense of the Claim at its own
expense.  If the Company does not elect
to assume control or otherwise participate in the defense of the Claim, then
the Indemnified Party may defend through counsel of its own choosing.  If such defense is not assumed by the
Company, the Company will not be subject to any liability under this Agreement
or otherwise for any settlement made without its consent (but such consent will
not be unreasonably withheld or delayed). If the Company elects not to or is
not entitled to assume the defense of a Claim, it will not be obligated to pay
the fees and expenses of more than one counsel for all Indemnified Parties with
respect to the Claim, unless an actual conflict of interest exists between such
Indemnified Party and any other of such Indemnified Parties with respect to the
Claim, in which event the Company will be obligated to pay the fees and
expenses of such additional counsel or counsels.

 

ARTICLE 10

GOVERNING LAW; MISCELLANEOUS

 

10.1         Governing Law.  This Agreement shall be enforced, governed by
and construed in accordance with the laws of the State of Illinois applicable
to agreements made and to be performed entirely within such state, without
regard to the principles of conflict of laws. 
The parties hereto hereby submit to the exclusive jurisdiction of the
United States Federal Courts located in the State of Illinois with respect to
any dispute arising under this Agreement, the agreements entered into in
connection herewith or the transactions contemplated hereby or thereby.  All parties irrevocably waive the defense of
an inconvenient forum to the maintenance of such suit or proceeding.  All parties further agree that service of
process upon a party mailed by first class mail shall be deemed in every
respect effective service of process upon the party in any such suit or
proceeding.  Nothing herein shall affect
any party’s right to serve process in any other manner permitted by law. All
parties agree that a final non-appealable judgment in any such suit or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on such judgment or in any other lawful manner.  The party which does not prevail in any
dispute arising under this Agreement shall be responsible for all reasonable
fees and expenses, including reasonable attorneys’ fees, incurred by the
prevailing party in connection with such dispute.

 

10.2         Counterparts; Electronic
Signatures.  This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original but all of which shall constitute one and the same agreement
and shall become effective when counterparts have been signed by each party and
delivered to the other party.  This
Agreement, once executed by a party, may be delivered to the other party hereto
by electronic transmission of a copy of this Agreement bearing the signature of
the party so delivering this Agreement.

 

10.3         Headings.  The headings of this Agreement are for
convenience of reference only and shall not form part of, or affect the
interpretation of, this Agreement.

 

10.4         Severability.  In the event that any provision of this
Agreement is invalid or unenforceable under any applicable statute or rule of
law, then such provision shall be deemed inoperative to the extent that it may
conflict therewith and shall be deemed modified to conform to such statute or

 

16

 

rule of law.  Any provision hereof which may prove invalid
or unenforceable under any law shall not affect the validity or enforceability
of any other provision hereof.

 

10.5         Entire Agreement; Amendments.  This Agreement and the instruments referenced
herein contain the entire understanding of the parties with respect to the
matters covered herein and therein and supersede all previous understandings or
agreements between the parties with respect to such matters.  No provision of this Agreement may be waived
other than by an instrument in writing signed by the party to be charged with
enforcement.  The provisions of this
Agreement may be amended only by a written instrument signed by the Company and
the Buyer.

 

10.6         Notices.  Any notices required or permitted to be given
under the terms of this Agreement shall be sent by certified or registered mail
(return receipt requested) or delivered personally or by courier (including a
recognized overnight delivery service) or by facsimile and shall be effective
five days after being placed in the mail, if mailed by regular United States
mail, or upon receipt, if delivered personally or by courier (including a
recognized overnight delivery service) or by facsimile, in each case addressed
to a party.  The addresses for such
communications shall be:

 

If to the Company:

 

Broadwind Energy, Inc.

47 E. Chicago Avenue, Suite 332

Naperville, IL 60540

Telephone: (630) 637-0315

Facsimile: 
(630) 637-8472

Attention:  Mr. J. Cameron Drecoll

 

With copy to:

 

Fredrikson & Byron, P.A.

4000 U.S. Bank Plaza

200 South Sixth Street

Minneapolis, MN  55402-1425

Telephone: (612) 492-7000

Facsimile:  (612) 492-7077

Attention:  Daniel A. Yarano

 

If to the Buyer:

 

Charles H. Beynon

5151 San Felipe, Suite 425

Houston, Texas 77056

Telephone: (713) 305-7912

Facsimile: (713) 868-4660

 

Each party shall provide
notice to the other party of any change in address.

 

10.7         Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of the parties and their successors and assigns.  The Company shall not assign this Agreement
or any rights or obligations hereunder without the prior written consent of the
Buyer.

 

17

 

10.8         Third Party Beneficiaries.  This Agreement is intended for the benefit of
the parties hereto and their respective permitted successors and assigns, and
is not for the benefit of, nor may any provision hereof be enforced by, any
other person.

 

10.9         Publicity.  The Company and the Buyer shall have the right
to review for a reasonable period of time before issuing any press releases or
any other public statements with respect to the transactions contemplated
hereby; provided, however, that the Company shall be entitled, without the
prior approval of the Buyer, to make any press release with respect to such
transactions as is required by applicable law and regulations (although the
Buyer shall be consulted by the Company in connection with any such press
release prior to its release and shall be provided with a copy thereof and be
given an opportunity to comment thereon). 
Notwithstanding the foregoing, the Company shall file with the SEC a Form 8-K
disclosing the transactions herein within four (4) business days of the
Closing Date and attach the relevant agreements and instruments thereto, and
the Buyer may make such filings as may be required under Section 13 and Section 16
of the 1934 Act.

 

10.10       Further Assurances.  Each party shall do and perform, or cause to
be done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
the other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.

 

10.11       No Strict Construction.  The language used in this Agreement will be
deemed to be the language chosen by the parties to express their mutual intent,
and no rules of strict construction will be applied against any party.

 

10.12       Rights Cumulative.  Each and all of the various rights, powers
and remedies of the parties shall be considered cumulative with and in addition
to any other rights, powers and remedies which or the Transaction Documents
such parties may have at law or in equity in the event of the breach of any of
the terms of this Agreement.  The
exercise or partial exercise of any right, power or remedy shall neither
constitute the exclusive election thereof nor the waiver of any other right,
power or remedy available to such party.

 

10.13       Survival.  Any covenant or agreement in this Agreement
required to be performed following the closing of the transactions contemplated
herein shall survive the Closing Date. Without limitation of the foregoing, the
respective representations and warranties given by the parties hereto shall
survive the consummation of the transactions contemplated herein, but only for
a period of the earlier of (i) three (3) years following the Closing
Date and (ii) the applicable statute of limitations with respect to each
representation and warranty, and thereafter shall expire and have no further
force and effect.

 

10.14       Knowledge.  The term “knowledge of the Company” or any
similar formulation of knowledge shall mean, the actual knowledge after due
inquiry of an executive officer of the Company.

 

[Signature
Page Follows]

 

18

 

IN
WITNESS WHEREOF, the undersigned have caused this Agreement to be duly executed
as of the date first above written.

 

	
   

  	
  COMPANY:

  
	
   

  	
   

  	
   

  
	
   

  	
  BROADWIND ENERGY, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. Cameron Drecoll

  
	
   

  	
  J. Cameron Drecoll, Chief
  Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BUYER:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ Charles H. Beynon

  
	
   

  	
  Charles H. Beynon

  

 

A-1Exhibit 10.3

 

REGISTRATION RIGHTS
AGREEMENT

 

BY AND BETWEEN

 

BROADWIND ENERGY, INC.

 

AND

 

CHARLES H. BEYNON

 

 

APRIL 24, 2008

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 1

  	
   

  	
  Definitions

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 2

  	
   

  	
  Registration Rights

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
     2.1

  	
   

  	
  Current Public Information

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
     2.2

  	
   

  	
  Intentionally Omitted

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
     2.3

  	
   

  	
  Piggyback Registration

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
     2.4

  	
   

  	
  Underwriting; Holdback Agreements

  	
  5

  
	
   

  	
   

  	
   

  	
   

  
	
     2.5

  	
   

  	
  Registration Procedures

  	
  6

  
	
   

  	
   

  	
   

  	
   

  
	
     2.6

  	
   

  	
  Conditions Precedent to Company’s
  Obligations Pursuant to this Agreement

  	
  8

  
	
   

  	
   

  	
   

  	
   

  
	
     2.7

  	
   

  	
  Fees and Expenses

  	
  8

  
	
   

  	
   

  	
   

  	
   

  
	
     2.8

  	
   

  	
  Indemnification

  	
  8

  
	
   

  	
   

  	
   

  	
   

  
	
     2.9

  	
   

  	
  Participation in Registrations

  	
  12

  
	
   

  	
   

  	
   

  	
   

  
	
     2.10

  	
   

  	
  Compliance

  	
  12

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 3

  	
   

  	
  Transfers of Certain Rights

  	
  12

  
	
   

  	
   

  	
   

  	
   

  
	
     3.1

  	
   

  	
  Transfer

  	
  12

  
	
   

  	
   

  	
   

  	
   

  
	
     3.2

  	
   

  	
  Transferees

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
     3.3

  	
   

  	
  Subsequent Transferees

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 4

  	
   

  	
  Representations of Purchaser

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
     4.1

  	
   

  	
  Certain Representations of the
  Purchaser

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
     4.2

  	
   

  	
  Effect of Representations

  	
  14

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 5

  	
   

  	
  Miscellaneous

  	
  14

  
	
   

  	
   

  	
   

  	
   

  
	
     5.1

  	
   

  	
  Recapitalizations, Exchanges, etc

  	
  14

  
	
   

  	
   

  	
   

  	
   

  
	
     5.2

  	
   

  	
  No Inconsistent Agreements

  	
  14

  
	
   

  	
   

  	
   

  	
   

  
	
     5.3

  	
   

  	
  Amendments and Waivers

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
     5.4

  	
   

  	
  Severability

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
     5.5

  	
   

  	
  Counterparts

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
     5.6

  	
   

  	
  Notices

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
     5.7

  	
   

  	
  Governing Law

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
     5.8

  	
   

  	
  Forum; Service of Process

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
     5.9

  	
   

  	
  Captions

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
     5.10

  	
   

  	
  No Prejudice

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
     5.11

  	
   

  	
  Words in Singular and Plural Form

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
     5.12

  	
   

  	
  Remedy for Breach

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
     5.13

  	
   

  	
  Successors and Assigns, Third Party
  Beneficiaries

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
     5.14

  	
   

  	
  Entire Agreement

  	
  16

  

 

i

 

	
     5.15

  	
   

  	
  Attorneys’ Fees

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
     5.16

  	
   

  	
  Termination of Rights

  	
  17

  

 

ii

 

REGISTRATION RIGHTS AGREEMENT

 

This REGISTRATION RIGHTS
AGREEMENT, dated as of April 24, 2008 (the “Agreement”),
is entered into by and between BROADWIND ENERGY, INC., a Nevada corporation
(the “Company”) and Charles H. Beynon (the “Purchaser”).

 

RECITALS:

 

A.            The Company desires to
issue and sell sixty two thousand eight hundred fourteen (62,814) shares of its
Common Stock to the Holders as set forth in the Securities Purchase Agreement,
dated as of April 22, 2007, entered into by and between the Company and
the Purchaser (the “Purchase Agreement”);

 

B.            It is a condition
precedent to the consummation of the transactions contemplated by the Purchase
Agreement that the Company provide for the rights set forth in this Agreement;
and

 

C.            Certain terms used in this
Agreement are defined in Article 1 hereof.

 

AGREEMENT

 

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

 

ARTICLE 1

DEFINITIONS

 

“Affiliate”
means any Person that directly or indirectly controls, or is under control
with, or is controlled by such Person. 
As used in this definition, “control” (including with its correlative
meanings, “controlled by” and “under common control with”) shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person (whether through ownership
of securities or partnership or other ownership interests, by contract or
otherwise).

 

“Business Day”
means any day excluding Saturday, Sunday or any other day which is a legal
holiday under the laws of the State of Wisconsin or is a day on which banking
institutions therein located are authorized or required by law or other
governmental action to close.

 

 “Closing
Date” has the meaning ascribed to such term in the Purchase Agreement.

 

“Common Stock”
means the common stock, par
value $0.001 per share, of the Company.

 

“Company”
has the meaning set forth in the preamble.

 

 

“Exchange Act”
means the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the SEC promulgated thereunder.

 

“Holders”  means holders of the Registrable Securities.

 

“Indemnified Party”
has the meaning set forth in Section 2.8.

 

“Losses”
has the meaning set forth in Section 2.8.

 

“Majority Holders”
means those Holders holding at least a majority of the Registrable Securities.

 

“Person”
means any individual, company,
partnership, firm, joint venture, association, joint-stock company, trust,
unincorporated organization, governmental body or other entity.

 

“Piggyback
Registration”  has the meaning set forth in Section 2.3.

 

“Purchase Agreement”
has the meaning set forth in
the preamble.

 

“Purchase Price”
has the meaning ascribed to
such term in the Purchase Agreement.

 

“Purchaser”
has the meaning set forth in
the preamble.

 

“Registrable Securities”
means, subject to the immediately following sentences, (i) shares of
Common Stock acquired by the Purchaser from the Company pursuant to the
Purchase Agreement and so long as this Agreement is still in effect, any other
shares of Common Stock acquired by the Purchaser on or after the Closing Date,
and (ii) any shares of Common Stock issued or issuable, directly or
indirectly, with respect to the securities referred to in clause (i) by
way of stock dividend or stock split or in connection with a combination of
shares, recapitalization, merger, consolidation or other reorganization.  In addition, any particular shares of Common
Stock constituting Registrable Securities will cease to be Registrable
Securities when (x) their offer and sale have been effectively registered
under the Securities Act and disposed of in accordance with a Registration
Statement covering such offer and sale, (y) they have been sold to the
public pursuant to Rule 144 (or by similar provision under the Securities
Act), or (z) are eligible for resale by the Holder thereof under Rule 144(k) (or
by similar provision under the Securities Act) without any limitation on the
amount of securities that may be sold under paragraph (e) thereof.

 

“Registration Statement”
means a registration statement on Form S-3 (or, if the Company is not
eligible to use Form S-3, such other appropriate registration form of the
SEC pursuant to which the Company is eligible to register the resale of
Registrable Securities) filed by the Company under the Securities Act which
covers any of the Registrable Securities pursuant to the provisions of this
Agreement, including the prospectus, amendments and supplements to such
registration statement, including post-effective amendments, all exhibits and
all material incorporated by reference in such registration statement, which
shall permit the Purchaser to offer and sell, on a delayed or continuous basis
pursuant to Rule 415 under the Securities Act, the Registrable Securities.

 

2

 

“register,”
“registered” and “registration” each shall refer to a
registration effected by preparing and filing a registration statement or
statements or similar documents in compliance with the Securities Act and the
declaration or ordering of effectiveness of such registration statement(s) or
documents by the SEC.

 

“Rule 144”
means Rule 144 promulgated by the SEC pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC having substantially the same effect as
such Rule.

 

“Rule 41
” means Rule 415 promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the SEC having
substantially the same effect as such Rule.

 

“SEC”
means the United States Securities and Exchange Commission or any other federal
agency at the time administering the Securities
Act and Exchange Act.

 

“Securities Act”
means the Securities Act of
1933, as amended, and the rules and regulations of the SEC promulgated
thereunder.

 

ARTICLE 2

REGISTRATION RIGHTS

 

2.1           Current Public Information.  The Company covenants that it will use its
best efforts to file all reports required to be filed by it under the Exchange
Act and will use its reasonable best efforts to take such further action as the
Holders may reasonably request, all to the extent required to enable the
Holders to sell Registrable Securities pursuant to Rule 144 adopted by the
SEC under the Securities Act or any similar rule or regulation hereafter
adopted by the SEC.  The Company shall,
upon the request of a Holder, deliver to such Holder a written statement as to
whether it has complied with such requirements during the twelve month period
immediately preceding the date of such request.

 

2.2           Intentionally Omitted.

 

2.3           Piggyback Registration.

 

(a)   Whenever the Company proposes to register any of its
securities under the Securities Act (other than pursuant to a registration on Form S-4
or S-8 or any successor or similar forms, or the initial registration
statement, or any subsequent registration statement, related to a rights
offering by the Company) and the registration form to be used may be used for
the registration of Registrable Securities, whether or not for sale for its own
account, the Company will give prompt written notice (but in no event less than
30 days before the anticipated filing date) to all Holders (other than Holders
all of whose Registrable Securities are then covered by an effective
Registration Statement), and such notice shall describe the proposed
registration and distribution and offer to all such Holders the opportunity to
register the number of Registrable Securities as each such Holder may
request.  The Company will include in
such registration statement all Registrable Securities with respect to which
the Company has received 

 

3

 

written requests for inclusion therein within 15 days after the Holders’
receipt of the Company’s notice (a “Piggyback Registration”).

 

(b)   The Company shall use its reasonable best efforts to
cause the managing underwriter or underwriters of a proposed underwritten
offering involving a Piggyback Registration to permit the Registrable
Securities requested to be included in a Piggyback Registration to be included
on the same terms and conditions as any similar securities of the Company or
any other security holder included therein and to permit the sale or other
disposition of such Registrable Securities in accordance with the intended
method of distribution thereof.

 

(c)   Any Holder shall have the right to withdraw its
request for inclusion of its Registrable Securities in any Registration
Statement pursuant to this Section 2.3 by giving written notice to
the Company of its request to withdraw; provided, that in the event of such
withdrawal (other than pursuant to Section 2.3(e) hereof), the
Company shall not be required to reimburse such Holder for the fees and
expenses referred to in Section 2.7 hereof incurred by such Holder
prior to such withdrawal, unless such withdrawal was due to a material adverse
change to the Company.  The Company may
withdraw a Piggyback Registration at any time prior to the time it becomes
effective.

 

(d)   If (i) a Piggyback Registration involves an
underwritten offering of the securities being registered, whether or not for
sale for the account of the Company, to be distributed (on a firm commitment
basis) by or through one or more underwriters of recognized standing under
underwriting terms appropriate for such a transaction, and (ii) the
managing underwriter of such underwritten offering shall inform the Company and
Holders requesting such registration by letter of its belief that the
distribution of all or a specified number of such Registrable Securities concurrently
with the securities being distributed by such underwriters would interfere with
the successful marketing of the securities being distributed by such
underwriters (such writing to state the basis of such belief and the
approximate number of such Registrable Securities which may be distributed
without such effect), then the Company will be required to include in such
registration only the amount of securities which it is so advised should be
included in such registration.  In such
event: (x) in cases initially involving the registration for sale of
securities for the Company’s own account, securities shall be registered in
such offering in the following order of priority: (i) first, the
securities which the Company proposes to register, and (ii) second,
Registrable Securities and securities which have been requested to be included
in such registration by Persons entitled to exercise “piggy-back” registration
rights pursuant to contractual commitments of the Company (pro rata based on
the amount of securities sought to be registered by Holders and such other
Persons); and (y) in cases not initially involving the registration for
sale of securities for the Company’s own account, securities shall be
registered in such offering in the following order of priority: (i) first,
the securities of any Person whose exercise of a “demand” registration right
pursuant to a contractual commitment of the Company is the basis for the
registration, (ii) second, Registrable Securities and securities which
have been requested to be included in such registration by Persons entitled to
exercise “piggy-back” registration rights pursuant to contractual commitments
of the Company (pro rata based on the amount of securities sought to be
registered by Holders and such other Persons), and (iii) third, the
securities which the Company proposes to register.

 

4

 

(e)   If, as a result of the proration provisions of this Section 2.3,
any Holder shall not be entitled to include all Registrable Securities in a
Piggyback Registration that such Holder has requested to be included, such
holder may elect to withdraw his request to include Registrable Securities in
such registration.

 

(f)    The right of the Holders to register Registrable
Securities pursuant to this Section 2.3 is only exercisable with
respect to Registrable Securities not then covered by an effective Registration
Statement.

 

2.4           Underwriting; Holdback
Agreements.

 

(a)   In the event that one or more Holders elect to
dispose of Registrable Securities under a Registration Statement pursuant to an
underwritten offering, the managing underwriter or underwriters shall be
selected by the holders of a majority (by number of shares owned) of the
Registrable Securities to be sold in the underwritten offering or requested to
be included in such Registration Statement and shall be reasonably acceptable
to the Company.  In connection with any
such underwritten offering, the Company shall take all such reasonable actions
as are required by the managing underwriters in order to expedite and
facilitate the registration and disposition of the Registrable Securities,
including the Company causing appropriate executive officers of the Company or
its Affiliates to participate in a “road show” or similar marketing effort
being conducted by such managing underwriters with respect to such underwritten
offering.

 

(b)   All Holders proposing to distribute their
Registrable Securities through an underwritten offering shall enter into an
underwriting agreement in customary form with the managing underwriters
selected for such underwritten offering.

 

(c)   To the extent not inconsistent with applicable law,
in connection with a public offering of securities of the Company, upon the
request of the Company or, in the case of an underwritten public offering of
the Company’s securities, the managing underwriters, each Holder who
beneficially owns (as defined in Rule 13d-3 adopted by the SEC under the
Exchange Act) at least 5% of the outstanding capital stock of the Company will
not effect any sale or distribution (other than those included in the
registration statement being filed with respect to such public offering) of, or
any short sale of, or any grant of option to purchase, or any hedging or
similar transaction with respect to, any securities of the Company, or any
securities, options or rights convertible into or exchangeable or exercisable
for such securities during the 14 days prior to and the 90-day period beginning
on the effective date of such public offering, unless the Company, or in the
case of an underwritten public offering, the managing underwriters otherwise
agree to a shorter period of time.  At
the request of the Company or the managing underwriters, each such Holder shall
execute a customary “lock-up” agreement consistent with the provisions of this Section 2.4;
provided, however, that no Holder shall be required to enter into any such “lock
up” agreement unless and until all of the Company’s executive officers and
directors execute substantially similar “lock up” agreements and the Company
uses commercially reasonable efforts to cause each holder of more than 5% of
its outstanding capital stock to execute substantially similar “lock up”
agreements.  Neither the Company nor the
underwriter shall terminate, materially amend or waive the enforcement of any
material provision under a “lock up” agreement unless each “lock up” agreement
with a Holder is also amended or waived 

 

5

 

in a similar manner or terminated, as the case may be.  The Company may impose stop-transfer
instructions to enforce the restrictions imposed by this Section 2.4.

 

2.5           Registration Procedures.  The Company will use its reasonable best
efforts to effect the registration of Registrable Securities pursuant to this
Agreement in accordance with the intended methods of disposition thereof, and
pursuant thereto the Company will as expeditiously as possible:

 

(a)   before filing the Registration Statement or any
amendment or supplement thereto, the Company will furnish to any counsel
selected by the holders of a majority of the Registrable Securities a copy of
such Registration Statement, amendment or supplement and allow such counsel
reasonable time to review and comment on such Registration Statement, amendment
or supplement prior to the filing thereof and will provide such counsel with
all written correspondence with the SEC regarding such Registration Statement,
amendment or supplement;

 

(b)   prepare and file with the SEC the Registration
Statement, and such amendments and supplements to such Registration Statement
and the prospectus used in connection therewith as may be necessary to keep
such Registration Statement effective for the periods contemplated by the
Company or the Holders requesting any Registration Statement filed pursuant to Section 2.3,
and in compliance with all applicable rules and regulations of the SEC and
the terms of this Agreement;

 

(c)   furnish to each Holder selling such Registrable
Securities such number of copies of such Registration Statement, each amendment
and supplement thereto, the prospectus included in the Registration Statement
(including each preliminary prospectus) and such other documents as such seller
may reasonably request in order to facilitate the disposition of the
Registrable Securities owned by such Holder;

 

(d)   use its reasonable best efforts to register or
qualify such Registrable Securities under such other state securities or “blue
sky” laws as the selling Holders selling such Registrable Securities reasonably
requests and do any and all other acts and things which may be reasonably
necessary or reasonably advisable to enable such Holder to consummate the
disposition in such jurisdictions of the Registrable Securities owned by such
Holder and to keep each such registration or qualification (or exemption
therefrom) effective during the period which the Registration Statement is
required to be kept effective (provided, that the Company will not be required
to (i) qualify generally to do business in any jurisdiction where it would
not otherwise be required to qualify but for this subparagraph, (ii) subject
itself to taxation in any such jurisdiction or (iii) consent to general
service of process in any such jurisdiction);

 

(e)   notify each Holder selling such Registrable
Securities, at any time when a prospectus relating thereto is required to be
delivered under the Securities Act, of the happening of any event as a result
of which the prospectus included in the Registration Statement contains an
untrue statement of a material fact or omits any fact necessary to make the
statements therein not misleading in the light of the circumstances under which
they were made, and, at the request of any such Holder, the Company will as
soon as possible prepare and furnish to such Holder a reasonable number of
copies of a supplement or amendment to such prospectus so that, as 

 

6

 

thereafter delivered to the purchasers of such Registrable Securities,
such prospectus will not contain an untrue statement of a material fact or omit
to state any fact necessary to make the statements therein not misleading in
the light of the circumstances under which they were made;

 

(f)    cause all such Registrable Securities to be listed
or quoted on each securities exchange or quotation service on which similar
securities issued by the Company are then listed or quoted and, if not so
listed, to be approved for trading on any automated quotation system of a
national securities association on which similar securities of the Company are
quoted;

 

(g)   provide a transfer agent and registrar for all such
Registrable Securities not later than the effective date of such Registration
Statement;

 

(h)   enter into such customary agreements (including
underwriting agreements containing customary representations and warranties)
and take all other customary and appropriate actions as the holders of a
majority of the Registrable Securities being sold or the managing underwriters,
if any, reasonably request in order to expedite or facilitate the disposition
of such Registrable Securities;

 

(i)    notify each Holder of any stop order issued or
threatened by the SEC;

 

(j)    otherwise comply with all applicable rules and
regulations of the SEC, and make available to its security holders, as soon as
reasonably practicable, an earnings statement covering the period of at least
twelve months beginning with the first day of the Company’s first full calendar
quarter after the effective date of the Registration Statement, which earnings
statement shall satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder;

 

(k)   in the event of the issuance of any stop order
suspending the effectiveness of a Registration Statement, or of any order
suspending or preventing the use of any related prospectus or suspending the
qualification of any securities included in such Registration Statement for
sale in any jurisdiction, the Company will use its reasonable best efforts to
promptly obtain the withdrawal of such order;

 

(l)    subject to execution and delivery of mutually
satisfactory confidentiality agreements, make available at reasonable times for
inspection by each Holder selling such Registrable Securities, any managing
underwriter participating in any disposition of such Registrable Securities
pursuant to the Registration Statement, and any attorney, accountant or other
agent retained by such Holder or any such managing underwriter, during normal
business hours of the Company at the Company’s corporate office in Manitowoc,
Wisconsin and without unreasonable disruption of the Company’s business or
unreasonable expense to Company and solely for the purpose of due diligence
with respect to the Registration Statement, legally disclosable, financial and
other records and pertinent corporate documents of the Company and its
subsidiaries reasonable requested by such Persons, and cause the Company’s
employees to, and request its independent accountants to, supply all similar
information reasonably requested by any such Person, as shall be reasonably
necessary to enable them to exercise their due diligence responsibility;

 

7

 

(m)  cooperate with each seller of Registrable Securities
and each underwriter participating in the disposition of such Registrable
Securities and their respective counsel in connection with any filings required
to be made with the OTC Bulletin Board or FINRA; and

 

(n)   take all other steps reasonably necessary to effect
the registration of the Registrable Securities contemplated hereby.

 

2.6           Conditions Precedent to Company’s Obligations
Pursuant to this Agreement.  It shall be a condition precedent to the
obligations of the Company to take any action pursuant to this Article 2
with respect to the Registrable Securities of any Holder that such Holder shall
timely furnish to the Company such information regarding itself, the
Registrable Securities held by it and the intended method of distribution of
such securities as shall reasonably be required to effect the registration of such
Holder’s Registrable Securities.

 

2.7           Fees and Expenses.  All expenses incident to the Company’s
performance of or compliance with this Agreement including, without limitation,
all registration and filing fees payable by the Company, fees and expenses of
compliance by the Company with securities or blue sky laws, printing expenses
of the Company, messenger and delivery expenses of the Company, and fees and
disbursements of counsel for the Company and all independent certified public
accountants of the Company, and other Persons retained by the Company will be
borne by the Company, and the Company will pay its internal expenses
(including, without limitation, all salaries and expenses of the Company’s
employees performing legal or accounting duties), the expense of any annual
audit or quarterly review, the expense of any liability insurance of the
Company and the expenses and fees for listing or approval for trading of the
securities to be registered on each securities exchange on which similar
securities issued by the Company are then listed or on any automated quotation
system of a national securities association or other quotation system on which
similar securities of the Company are quoted. 
In connection with any Registration Statement filed hereunder, the
Company will pay the reasonable fees and expenses of a single counsel retained
by the Holders of a majority (by number of shares) of the Registrable
Securities requested to be included in such Registration Statement.  The Company shall have no obligation to pay
any underwriting discounts or commissions attributable to the sale of
Registrable Securities and any of the expenses incurred by any Holder which are
not payable by the Company, such costs to be borne by such Holder or Holders,
including, without limitation, underwriting fees, discounts and expenses, if
any, applicable to any Holder’s Registrable Securities; fees and disbursements
of counsel or other professionals that any Holder may choose to retain in
connection with a Registration Statement filed pursuant to this Agreement
(except as otherwise provided herein); selling commissions or stock transfer
taxes applicable to the Registrable Securities registered on behalf of any
Holder; any other expenses incurred by or on behalf of such Holder in connection
with the offer and sale of such Holder’s Registrable Securities other than
expenses which the Company is expressly obligated to pay pursuant to this
Agreement.

 

2.8           Indemnification.

 

(a)   The Company agrees to indemnify and hold harmless,
to the fullest extent permitted by law, Holders and each underwriter, if any,
and any Person who controls such underwriter (within the meaning of Section 15
of the Securities Act), from and against any loss, 

 

8

 

claim, damage, liability, reasonable attorney’s fees, cost or expense
and costs and expenses of investigating and defending any such claim
(collectively, the “Losses”),
joint or several, and any action in respect thereof to which the Holders may
become subject under the Securities Act or otherwise, insofar as such Losses
(or actions or proceedings, whether commenced or threatened, in respect
thereto) arise out of or are based upon (i) any breach by the Company of
any of its representations, warranties or covenants contained in this
Agreement, (ii) any untrue or alleged untrue statement of a material fact
contained in any Registration Statement, prospectus or preliminary or summary
prospectus or any amendment or supplement thereto or (iii) any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and the Company
shall reimburse the Holders for any reasonable legal or any other expenses
actually incurred by them in connection with investigating or defending or
preparing to defend against any such Loss, action or proceeding; provided,
however, that the Company shall not be liable to the Holders or other
indemnitee in any such case to the extent that any such Loss (or action or
proceeding, whether commenced or threatened, in respect thereof) arises out of
or is based upon (x) an untrue statement or alleged untrue statement or
omission or alleged omission, made in such Registration Statement, any such
prospectus or preliminary or summary prospectus or any amendment or supplement
thereto, in reliance upon, and in conformity with, written information prepared
and furnished to the Company by any Holder expressly for use therein and, with
respect to any untrue statement or omission or alleged untrue statement or
omission made in any preliminary prospectus relating to the Registration
Statement, to the extent that a prospectus relating to the Registrable
Securities was required to be delivered by such Holder under the Securities Act
in connection with such purchase, there was not sent or given to such Person,
at or prior to the written confirmation of the sale of such Registrable
Securities to such Person, a copy of the final prospectus that corrects such
untrue statement or alleged untrue statement or omission or alleged omission if
the Company had previously furnished copies thereof to such Holder or (y) use
of a Registration Statement or the related prospectus during a period when a
stop order has been issued in respect of such Registration Statement or any
proceedings for that purpose have been initiated or use of a prospectus when
use of such prospectus has been suspended pursuant to Sections 2.5(e) or
(i); provided that in each case, that such Holder received prior written notice
of such stop order, initiation of proceedings or suspension from the
Company.   In no event, however, shall
the Company be liable for indirect, incidental or consequential or special
damages of any kind.

 

(b)   In connection with the filing of the Registration
Statement by the Company pursuant to this Agreement, the Holders will furnish
to the Company in writing such information as the Company reasonably requests
for use in connection with such Registration Statement and the related
prospectus and, to the fullest extent permitted by law, the Holders will
indemnify and hold harmless the Company and its officers, directors, employees
and agents, and each underwriter, if any, and any Person who controls such
underwriter (within the meaning of Section 15 of the Securities Act), from
and against any Losses, severally but not jointly, and any action in respect
thereof to which the Company or its officers, directors, employees and agents,
may become subject under the Securities Act or otherwise, insofar as such Losses
(or actions or proceedings, whether commenced or threatened, in respect
thereof) arise out of or are based upon (i) the purchase or sale of
Registrable Securities during a suspension as set forth in Section 2.5(e) or
Section 2.5(i) in each case after receipt of written notice of
such suspension, (ii) any untrue or 

 

9

 

alleged untrue statement of a material fact contained in the
Registration Statement, prospectus or preliminary or summary prospectus or any
amendment or supplement thereto, or (iii) any omission or alleged omission
of a material fact required to be stated therein or necessary to make the
statements therein not misleading, but, with respect to clauses (ii) and (iii) above,
only to the extent that such untrue statement or omission is made in such
Registration Statement, any such prospectus or preliminary or summary
prospectus or any amendment or supplement thereto, in reliance upon and in
conformity with written information prepared and furnished to the Company by
such Holder expressly for use therein or by failure of such Holder to deliver a
copy of the Registration Statement or prospectus or any amendments or
supplements thereto, and such Holder will reimburse the Company for any
reasonable legal or any other expenses incurred by them in connection with
investigating or defending or preparing to defend against any such Loss, action
or proceeding; provided, however, that such Holder shall not be liable in any
such case to the extent that prior to the filing of any such Registration
Statement or prospectus or amendment or supplement thereto, such Holder has
furnished in writing to the Company information expressly for use in such
Registration Statement or prospectus or any amendment or supplement thereto
which corrected or made not misleading information previously furnished to the
Company.  The obligation of each Holder
to indemnify the Company and its officers, directors, employees and agents,  shall be limited to the net proceeds received
by such Holder from the sale of Registrable Securities under such Registration
Statement.  In no event, however, shall
any Holder be liable for indirect, incidental or consequential or special
damages of any kind.

 

(c)   Promptly after receipt by any Person in respect of
which indemnity may be sought pursuant to Section 2.8(a) or 2.8(b) (an
“Indemnified Party”) of notice of any
claim or the commencement of any action, the Indemnified Party shall, if a
claim in respect thereof is to be made against the Person against whom such
indemnity may be sought (an “Indemnifying
Party”), promptly notify the Indemnifying Party in writing of
the claim or the commencement of such action; provided, that the failure to
notify the Indemnifying Party shall not relieve the Indemnifying Party from any
liability which it may have to an Indemnified Party under Section 2.8(a) or
2.8(b) except to the extent of any actual prejudice resulting
therefrom.  If any such claim or action
shall be brought against an Indemnified Party, and it shall notify the
Indemnifying Party thereof, the Indemnifying Party shall be entitled to
participate therein, and, to the extent that it wishes, jointly with any other
similarly notified Indemnifying Party, to assume the defense thereof with
counsel reasonably satisfactory to the Indemnified Party. After notice from the
Indemnifying Party to the Indemnified Party of its election to assume the
defense of such claim or action, the Indemnifying Party shall not be liable to
the Indemnified Party for any legal or other expenses subsequently incurred by
the Indemnified Party in connection with the defense thereof other than
reasonable costs of investigation; provided, that the Indemnified Party shall
have the right to employ separate counsel to represent the Indemnified Party
who may be subject to liability arising out of any claim in respect of which
indemnity may be sought by the Indemnified Party against the Indemnifying
Party, but the fees and expenses of such counsel shall be for the account of
such Indemnified Party unless (i) the Indemnifying Party and the
Indemnified Party shall have mutually agreed to the retention of such counsel
or (ii) in the written opinion of counsel to such Indemnified Party,
representation of both parties by the same counsel would be inappropriate due
to actual or potential conflicts of interest between them, it being understood,
however, that the Indemnifying Party shall not, in connection with any one such
claim or action or separate but substantially similar or related claims or
actions in the same

 

10

 

jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (together with appropriate local counsel) at any time for all
Indemnified Parties.  No Indemnifying Party
shall, without the prior written consent of the Indemnified Party, effect any
settlement of any claim or pending or threatened proceeding in respect of which
the Indemnified Party is or could have been a party and indemnity could have
been sought hereunder by such Indemnified Party, unless such settlement
includes an unconditional release of such Indemnified Party from all liability
arising out of such claim or proceeding other than the payment of monetary
damages by the Indemnifying Party on behalf of the Indemnified Party.  Whether or not the defense of any claim or
action is assumed by the Indemnifying Party, such Indemnifying Party will not
be subject to any liability for any settlement made without its written
consent, which consent will not be unreasonably withheld.

 

(d)   If the indemnification provided for in this Section 2.8
is unavailable to the Indemnified Parties in respect of any Losses referred to
herein notwithstanding that this Section 2.8 by its terms provides
for indemnification in such case, then each Indemnifying Party, in lieu of
indemnifying such Indemnified Party, shall contribute to the amount paid or
payable by such Indemnified Party as a result of such Losses in such proportion
as is appropriate to reflect the relative benefits received by the Company on
the one hand and the Holders on the other from the offering of the Registrable
Securities, or if such allocation is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits but also
the relative fault of the Company on the one hand and the Holders on the other
in connection with the statements or omissions which resulted in such Losses,
as well as any other relevant equitable considerations. The relative fault of
the Company on the one hand and of each Holder on the other shall be determined
by reference to, among other things, whether any action taken, including any
untrue or alleged untrue statement of a material fact, or the omission or
alleged omission to state a material fact relates to information supplied by
such party, and the parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.

 

The Company and the Holders agree that it
would not be just and equitable if contribution pursuant to this Section 2.8(d) were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to in the
immediately preceding paragraph.  The
amount paid or payable by an Indemnified Party as a result of the Losses
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any reasonable legal or other
expenses reasonably incurred by such Indemnified Party in connection with
investigating or defending any such action or claim.  Notwithstanding the provisions of this Section 2.8,
no Holder shall be required to contribute any amount in excess of the amount by
which the total price at which the Registrable Securities of such Holder were
offered to the public exceeds the amount of any Losses which such Holder has
otherwise paid by reason of such untrue or alleged untrue statement or omission
or alleged omission.   No Person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation.  Each Holder’s obligations to contribute
pursuant to this Section 2.8 is several in the proportion that the
proceeds of the offering received by such Holder bears to the total proceeds of
the offering received by all the 

 

11

 

Holders. 
The indemnification provided by this Section 2.8 shall be a
continuing right to indemnification with respect to sales of Registrable
Securities and shall survive the registration and sale of any Registrable
Securities by any Holder and the expiration or termination of this Agreement.  The indemnity and contribution agreements
contained herein are in addition to any liability that any Indemnifying Party
might have to any Indemnified Party.

 

2.9           Participation in
Registrations.

 

(a)   No Person may participate in any registration
hereunder which is underwritten unless such Person (i) agrees to sell such
Person’s securities on the basis provided in any underwriting arrangements
approved by the Person or Persons entitled hereunder to approve such
arrangements and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements and this Agreement.

 

(b)   Each Person that is participating in any
registration under this Agreement agrees that, upon receipt of any notice from
the Company of the happening of any event of the kind described in Section 2.5(e) or
Section 2.5(i) above, such Person will forthwith discontinue
the disposition of its Registrable Securities pursuant to the Registration
Statement and all use of the Registration Statement or any prospectus or
related document until such Person’s receipt of the copies of a supplemented or
amended prospectus as contemplated by such Section 2.5(e) or Section 2.5(i) and,
if so directed by the Company, will deliver to the Company (at the Company’s
expense) all copies, other than permanent file copies, then in such Holder’s
possession of such documents at the time of receipt of such notice.  Furthermore, each Holder agrees that if such
Holder uses a prospectus in connection with the offering and sale of any of the
Registrable Securities, the Holder will use only the latest version of such
prospectus provided by Company.

 

(c)   None of the Holders shall have the right to
participate as a purchaser or otherwise acquire any beneficial ownership of the
Company’s securities in any offering of the Company’s securities, including any
shareholder rights offering (i) occurring within twelve (12) months from
the date of this Agreement and (ii) in which any proceeds from such
offering are used to directly or indirectly reduce the Company’s indebtedness
incurred to finance the transactions contemplated by the Purchase Agreement.

 

2.10         Compliance.  With respect to any registration under this
Agreement, each Holder shall comply in all material respects with all
applicable securities and other laws, rules and regulations, including but
not limited to all rules and regulations of the SEC, the National
Association of Securities Dealers and any securities exchange or quotation
service on which the Company’s securities are listed or quoted.

 

ARTICLE 3

TRANSFERS OF CERTAIN RIGHTS

 

3.1           Transfer.  The rights granted to the Purchaser under
this Agreement may be transferred, subject to the provisions of Sections 3.2
and 3.3; provided that nothing contained 

 

12

 

herein shall be deemed to permit an assignment, transfer or disposition
of the Registrable Securities in violation of the terms and conditions of the
Purchase Agreement or applicable law.

 

3.2           Transferees.  Any transferee to whom rights under this
Agreement are transferred shall, before and as a condition to such transfer,
deliver to the Company a written instrument (i) stating the name and
address of the transferor and the transferee and the number of Registrable
Securities with respect to which the rights are intended to be transferred, and
(ii) by which such transferee agrees to be bound by the obligations
imposed upon the Purchaser under this Agreement to the same extent as if such
transferee were a Purchaser hereunder.

 

3.3           Subsequent Transferees.  A transferee to whom rights are transferred
pursuant to this Section 3 may not again transfer such rights to
any other Person, other than as provided in Sections 3.1 or 3.2
above.

 

ARTICLE 4

REPRESENTATIONS OF PURCHASER

 

4.1           Certain Representations of the Purchaser.  In connection with, and in consideration of,
the acquisition of the Common Stock by the Purchaser, the Purchaser hereby
represents and warrants to the Company as follows:

 

(a)           The Purchaser
acknowledges that it (i) is acquiring the Common Stock for its own account
without a view to distribution within the meaning of the Securities Act; (ii) has
had an opportunity to review the Company’s filings with the SEC and all other
information that it has deemed necessary to make an informed investment
decision with respect to an investment in the Company in general and the Common
Stock in particular; (iii) is financially able to bear the economic risks
of an investment in the Company; and (iv) has such knowledge and
experience in financial and business matters so as to be capable, by reason of
such knowledge and experience, of evaluating the merits and risks of, and
making an informed business decision with regard to, the acquisition of the
Common Stock.

 

(b)           The Purchaser realizes
that there are significant restrictions on the transferability of the Common
Stock, that the Common Stock have not been registered for sale under the
Securities Act or applicable state securities laws (the “State Laws”), and may be sold only pursuant to
registration under the Securities Act and State Laws, or an exemption
therefrom.

 

(c)           The Purchaser is an “accredited investor” within the meaning of
Rule 501 (a) of Regulation D, promulgated under the Securities Act and was not organized for the specific purpose of
acquiring the Common Stock, and, in the case of an individual, is a
resident of the state referenced in the preamble of this Agreement or, with
respect to an entity, has its principal executive office located in its state
of incorporation, as referenced in the preamble to this Agreement.

 

(d)           The Purchaser
acknowledges that this transaction has not been reviewed or approved by the
United States Securities and Exchange Commission (the “Commission”) or by any state securities or other
authority.

 

13

 

(e)           The acquisition of the
Common Stock by the Purchaser is not the result of any general solicitation or
general advertising, including, but not limited to (i) any advertisement,
article, notice or other communication published in any newspaper, magazine or
similar media or broadcast over television or radio; and (ii) any seminar
or meeting whose attendees have been invited by any general solicitation or
general advertising.

 

(f)            The Purchaser
certifies, under penalty of perjury, that it is not subject to the backup
withholding provisions of the Internal Revenue Code of 1986, as amended.  (Note: 
A Purchaser is subject to backup withholding if:  (i) the Purchaser fails to furnish the
undersigned’s Social Security Number or Taxpayer Identification Number herein; (ii) the
Internal Revenue Service notifies the Company that the Purchaser furnished an
incorrect Social Security Number or Taxpayer Identification Number; (iii) the
Purchaser is notified that the undersigned is subject to backup withholding; or
(iv) the Purchaser fails to certify that the Purchaser is not subject to
backup withholding or the Purchaser fails to certify the Purchaser’s Social
Security Number or Taxpayer Identification Number).

 

4.2           Effect of Representations.  The parties hereto acknowledge and agree that
(i) the representations of the Purchaser contained in Section 4.1
shall in no way modify, effect or diminish the rights of the Purchaser to
pursue any potential claim against the Company under the Purchase Agreement and (ii) no breach or alleged
breach of any representation or warranty contained in Section 4.1 shall
effect the rights and obligations of the parties under this Agreement.

 

ARTICLE 5

MISCELLANEOUS

 

5.1           Recapitalizations, Exchanges, etc.  The provisions of this Agreement shall apply
to the full extent set forth herein with respect to (i) the Registrable
Securities, (ii) any and all shares of Common Stock into which the Registrable
Securities are converted, exchanged or substituted in any recapitalization or
other capital reorganization by the Company and (iii) any and all equity
securities of the Company or any successor or assign of the Company (whether by
merger, consolidation, sale of assets or otherwise) which may be issued in
respect of, in conversion of, in exchange for or in substitution of, the
Registrable Securities and shall be appropriately adjusted for any stock
dividends, splits, reverse splits, combinations, recapitalizations and the like
occurring after the date hereof. The Company shall cause any successor or
assign (whether by merger, consolidation, sale of assets or otherwise) to enter
into a new registration rights agreement with the Holders on terms substantially
the same as this Agreement as a condition of any such transaction.

 

5.2           No Inconsistent Agreements.  The Company has not and shall not enter into
any agreement with respect to its securities that is inconsistent with the
rights granted to a Purchaser in this Agreement.  The parties acknowledge and agree that the
Company may grant registration rights hereafter, which shall be pari passu with
the registration rights of a Purchaser, and shall not be deemed to conflict
with this covenant.

 

14

 

5.3           Amendments and Waivers.  The provisions of this Agreement may be
amended and the Company may take action herein prohibited, or omit to perform
any act herein required to be performed by it, if, but only if, the Company has
obtained the written consent of Holders of at least a majority of the
Registrable Securities then in existence.

 

5.4           Severability.  Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall be held to
be prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Agreement.

 

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

 

5.6           Notices.  Any notices required or permitted to be given
under the terms of this Agreement shall be sent by certified or registered mail
(return receipt requested) or delivered personally or by courier (including a
recognized overnight delivery service) or by facsimile and shall be effective
five days after being placed in the mail, if mailed by regular United States
mail, or upon receipt, if delivered personally or by courier (including a
recognized overnight delivery service) or by facsimile, in each case addressed
to a party.  The addresses for such
communications shall be:

 

If to the Company:

 

Broadwind Energy, Inc.

47 East Chicago Avenue, Suite 332

Naperville, IL 60540

Attention:
Chief Executive Officer

Facsimile No.:
(630) 637-8472

 

With copy to:

 

Fredrikson & Byron,
P.A.

200 South Sixth Street, Suite 4000

Minneapolis, MN 55402

Attention: Daniel A. Yarano

Facsimile No.: (612) 492-7077

 

If to Purchaser:

 

Mr. Charles
H. Beynon

5151 San Felipe, Suite 425

Houston, Texas 77056

Facsimile No.:  (713) 868-4660

 

Each party shall provide notice to the other
party of any change in address.

 

15

 

5.7           Governing Law.  This Agreement shall be governed by and
construed in accordance with the laws of the State of Wisconsin, without regard
to the conflicts of laws rules or provisions.

 

5.8           Forum; Service of Process.  Any legal suit, action or proceeding brought
by the Company, Purchaser, any other Holders, any Person entitled to
indemnification or contribution hereunder, or any of their respective
Affiliates arising out of or based upon this Agreement shall be instituted
exclusively in any federal or state court in the State of Wisconsin, and each
such Person irrevocably waives any objection which it may now or hereafter have
to the laying of venue or any such proceeding, and irrevocably submits to the
jurisdiction of such courts in any such suit, action or proceeding.

 

5.9           Captions.  The captions, headings and arrangements used
in this Agreement are for convenience only and do not in any way limit or
amplify the terms and provisions hereof.

 

5.10         No Prejudice.  The terms of this Agreement shall not be
construed in favor of or against any party on account of its participation in
the preparation hereof.

 

5.11         Words in Singular and Plural
Form.  Words used in the singular
form in this Agreement shall be deemed to import the plural, and vice versa, as
the sense may require.

 

5.12         Remedy for Breach.  The Company hereby acknowledges that in the
event of any breach or threatened breach by the Company of any of the
provisions of this Agreement, the Holders would have no adequate remedy at law
and could suffer substantial and irreparable damage.  Accordingly, the Company hereby agrees that,
in such event, the Holders shall be entitled, and notwithstanding any election
by any Holder to claim damages, to obtain a temporary and/or permanent
injunction to restrain any such breach or threatened breach or to obtain
specific performance of any such provisions, all without prejudice to any and
all other remedies which any Holders may have at law or in equity.

 

5.13         Successors and Assigns,
Third Party Beneficiaries.  This
Agreement and all of the provisions hereof shall be binding upon and inure to
the benefit of the parties hereto, each assignee of the Holders pursuant to Article 3
and their respective successors and assigns and executors, administrators and
heirs.  Holders are intended third party
beneficiaries of this Agreement and this Agreement may be enforced by such
Holders.

 

5.14         Entire Agreement.  This Agreement sets forth the entire
agreement and understanding between the parties as to the subject matter hereof
and merges and supersedes all prior discussions, agreements and understandings
of any and every nature among them.

 

5.15         Attorneys’ Fees.  In the event of any action or suit based upon
or arising out of any actual or alleged breach by any party of any
representation, warranty, covenant or agreement in this Agreement, the
prevailing party shall be entitled to recover its reasonable attorneys’ fees
and expenses of such action or suit from the other party in addition to any
other relief ordered by any court.

 

16

 

5.16         Termination of Rights.  All rights under this Agreement will terminate
as to a Holder when that Holders no longer holds any Registrable Securities.

 

[Signature Page Follows]

 

17

 

IN WITNESS WHEREOF, the parties
hereto have caused this Registration Rights Agreement to be duly executed as of
the date and year first written above.

 

	
   

  	
  COMPANY:

  
	
   

  	
   

  
	
   

  	
  BROADWIND ENERGY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J.
  Cameron Drecoll

  
	
   

  	
  J. Cameron
  Drecoll, Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PURCHASER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  /s/ Charles
  H. Beynon

  
	
   

  	
  Charles H. Beynon

  

 

Signature Page to Registration Rights
Agreement

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