Document:

Unassociated Document

Exhibit 10.5

 

CAPITAL COMMITMENT AGREEMENT

 

UtiliPoint International, Inc., a New Mexico corporation (“UtiliPoint”) has contributed and shall continue to contribute monies to The Intelligent Project, LLC, a Delaware limited liability company (the “Company”)
in such amounts and at such times as the Company determines, in its sole discretion, up to the sum of $200,000.  On the date hereof, UtiliPoint has advanced the sum of $0.

 

1.           Contribution Obligation.  UtiliPoint hereby commits to make capital contributions to the Company in an aggregate amount up to $200,000 at such times and in such amounts as requested by the Company
in writing; provided that, in no event will any single request for a capital contribution be for an amount greater than $25,000.  The Company will give UtiliPoint not less than ten (10) days written notice before each such capital contribution is due, and will specify in the notice the date the capital contribution will be due and the amount of the capital contribution (a “Capital Call Notice”).  In addition, IP shall make
no new requests until at least 10 days has passed since the last previous Capital Call Notice.  UtiliPoint shall make all capital contributions to the Company by wire transfer of immediately available funds, in U.S. Dollars, to the bank account of the Company as shall be designated in the notice.  UtiliPoint’s obligation to make capital commitments hereunder shall terminate on the one (1) year anniversary of this Capital Commitment Agreement.

 

2.           Default.    The Company is entitled to enforce the obligations of UtiliPoint to make the capital contributions specified in this Capital Commitment Agreement. The Company has all rights
and remedies available at law or equity if any such capital contribution is not so made.  No part of any distribution pursuant to the Company’s limited liability company agreement shall be paid to UtiliPoint if there is then due and owing to the Company, at the time of such distribution, any amount required to be paid to the Company by UtiliPoint hereunder.  The Company may either (i) apply all or part of any such withheld distribution in satisfaction of the amount then due to the Company
from UtiliPoint or (ii) withhold such distribution until all amounts then due are paid to the Company by UtiliPoint.  Upon payment of all amounts due to the Company (by application of withheld distributions or otherwise), the Company shall distribute any unapplied balance of any such withheld distribution to UtiliPoint.  No interest shall be payable on the amount of any distribution withheld by the Company pursuant to this Section  Notwithstanding the foregoing, Company acknowledges
that Knox Lawrence International, LLC, a Delaware limited liability company (“KLI”) intends to make capital contributions to UtiliPoint in the aggregate amount of $200,000 (in a similar manner to previous contributions), which UtiliPoint intends to use to satisfy its obligations hereunder.  Notwithstanding anything to the contrary herein, it shall not be a default by UtiliPoint under this Capital Commitment Agreement if it fails to
make a capital contribution because it has not received sufficient funds from KLI to make such capital contribution.

 

3.           Assignment.  The rights and obligations of the Company and UtiliPoint will be binding upon and inure to the benefit of the successors, assigns, heirs, administrators and transferees of the parties.

 

 

 

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4.           Waiver and Amendment.  Any provision of this Capital Commitment Agreement may be amended, waived or modified upon the written consent of the Company and UtiliPoint.

5.           Notices.  Any notices, requests, demands and other communications required or permitted to be given under this Agreement will be in writing and, except as otherwise specified in writing, will be
given by personal delivery, facsimile transmission, express courier service or by registered or certified mail, postage prepaid, return receipt requested:

 

	 	 If to UtiliPoint: 	6000 Uptown Blvd.
	 	 	Suite 314
	 	 	Albuquerque, NM 87110
	 	 	Attn: CD Hobbs
	 	 	Telephone:  (505) 244-7600
	 	 	Facsimile:  (505) 244-7658
	 	 	 
	 	If to Company	Purdue Research Park
	 	 	3000 Kent Avenue
	 	 	West Lafayette, IN 47906-1075
	 	 	Attn:           David E. Steele
	 	 	Telephone:  (765) 588-3838
	 	 	Facsimile:  (314) 824-0404

 

or to such other addresses as either party hereto may from time to time give notice of (complying as to delivery with the terms of this Section 5) to the other. Notice by registered or certified mail will be effective three days after deposit in the United States mail. Notice by any other permitted means will be effective upon receipt.

 

6.           Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware.

 

7.           Severability.  If one or more provisions of this Capital Commitment Agreement are held to be unenforceable under applicable law, such provision shall be excluded from this Capital Commitment Agreement
and the balance of the Capital Commitment Agreement shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms.

 

8.           Time of the Essence. Time is of the essence of this Capital Commitment Agreement.

 

9.           Headings; References.  All headings used herein are used for convenience only and will not be used to construe or interpret this Capital Commitment Agreement.  Except where otherwise indicated,
all references herein to Sections refer to Sections hereof.

 

 

[Signatures on following page]

 

 

2

 

 

IN WITNESS WHEREOF, the parties have caused this Capital Commitment Agreement to be entered into as of July 1, 2009.

 

 

THE COMPANY

 

The Intelligent Project, LLC

 

By :__/s/ David E. Steele__________

 

Name: _David E. Steele___________

 

Title: _Senior Managing Director_____

 

	
UTILIPOINT

UtiliPoint International, Inc.

 

By: /s/ CD Hobbs_________________

Name: _CD Hobbs________________

Title: President & CEO_____________
	  
	  	  

 

 

 

 

3Unassociated Document

Exhibit 10.6

 

Agreement to be Bound

to the Limited Liability Company Agreement

of The Intelligent Project, LLC

July 1, 2009

Reference is hereby made to that certain Limited Liability Company Agreement dated as of May 22, 2009 (as amended and in effect from time to time, the “LLC Agreement”), among The Intelligent Project, LLC, a Delaware
limited liability company (the “Company”), and the Members (as defined therein).

The undersigned, CD Hobbs, not individually but on behalf of UtiliPoint International, Inc. (“UtiliPoint”) in order to enable UtiliPoint to become the holder of Company Interests, hereby acknowledges that the undersigned
has read the LLC Agreement and agrees that by the undersigned’s execution hereof (a) the undersigned acknowledges that UtiliPoint shall be deemed a “Member” with respect to its Company Interests for all purposes of the LLC Agreement; (b) UtiliPoint shall comply with and be bound by all terms and provisions applicable to “Members” under the LLC Agreement; and (c) UtiliPoint makes the representations and warranties contained in Article 12 of the LLC Agreement.  This Agreement
to be Bound (this “Agreement”) shall take effect and shall become a part of the LLC Agreement immediately upon execution.

UtiliPoint International, Inc. shall receive a 60% Percentage Interest in the Company.   The issuance of additional equity will dilute the existing members of the Company as set forth on page 21 of the Company pitch book (attached to this agreement), it being further agreed
that the issuance of equity of the Company of up to 12% (instead of 8% as set forth in the pitch book) to Netcom will only further dilute KLI IP Holding.  Except as set forth on page 21 of the pitch book, the issuance of additional equity will dilute the members pro rata.

This Agreement may be executed in two counterparts with the same effect as if the parties hereto had signed the same document.  The counterparts shall be construed together and shall constitute one instrument.  Signatures sent by fax shall constitute originals.

[The rest of this page is left blank intentionally.]

 

 

 

 

1

 

Executed as of the date first set forth above under the laws of the State of Delaware.

 

	 	UtiliPoint International, Inc.	 
	 	 	 	 
	
 
	
By: 
	/s/ CD Hobbs 	 
	 	 	Name: CD Hobbs	 
	 	 	Title: President and CEO	 
	 ACCEPTED AND AGREED:	 	 	 

	 	 	 	 	 
	 The Intelligent Project, LLC	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	
/s/ David E. Steele 
	 	 	
 
	 
	
Name: David E. Steele
	 	 	
 
	 
	
Title: Senior Managing Director
	 	 	
 
	 

 

 

 

 

 

 

 

 

 

2ex107.htm

Exhibit 10.7

 

CONSULTING AGREEMENT

 

THIS CONSULTING AGREEMENT entered into as of this 1st day of July, 2009 between UtiliPoint International, Inc., a New Mexico corporation (the “Company”) and KLI IP Holding Inc., a Delaware corporation (“Consultant”).

 

WHEREAS, the Company desires to engage Consultant to provide certain services for the Company, and Consultant desires to provide the same to Company.

 

NOW, THEREFORE, in consideration of the premises and the mutual promises set forth herein, the parties agree as follows:

 

1. For a period of twenty-four (24) months beginning on July 1, 2009 (the “Consulting Period”) Consultant shall serve as a consultant to the Company on matters pertaining
to the joint business and marketing efforts of the Company and The Intelligent Project, LLC, a Delaware limited liability company.  Consultant’s services shall include consultation with and advice to directors and officers of the Company.

 

2. During the Consulting Period, the Company shall be entitled to Consultant’s services for reasonable times when and to the extent requested by, and subject to the direction of, the Chairman and Chief Executive Officer of the Company.  Consultant’s
services shall be provided by Consultant’s employees, officer and managers.  Company acknowledges and agrees that Consultant will not be required to devote Consultant’s (or any of its employees, officers, or managers) full-time and business efforts to the duties of Consultant specified in this Agreement.  So long as Consultant accomplishes the services requested, it shall be left to the professional judgment of the Consultant as to the amount of time and the manner necessary to
perform the services.

 

3. Consultant’s services shall be rendered from its office, unless by mutual agreement from time to time arrangements are made for those services to be rendered elsewhere.  Reasonable travel and living expenses necessarily
incurred by Consultant’s officers, managers or employees to render services at locations other than its office shall be reimbursed by the Company promptly upon receipt of proper statements with regard to the nature and amount of those expenses.  Those statements shall be furnished to the Company monthly at the end of each calendar month of the Consulting Period during which any of those expenses are incurred.  In the performance of services for which travel and living expenses are incurred,
the Consultant will follow the procedures of UtiliPoint set forth on Exhibit A, annexed hereto and made a part hereof.

 

4. Consultant shall have no authority to bind Company by or to any obligation, agreement, promise or representation without first obtaining the written approval of the Chairman, President or Chief Executive Officer of the Company.  Consultant
shall not incur any liability on behalf of Company or in any way represent or bind Company in any manner or thing whatsoever and nothing herein shall be deemed to constitute either party the agent or legal representative of the other.  Consultant shall not have the authority and shall not represent that it has authority to approve check requests or to order, purchase or otherwise obtain any equipment, supplies, services or other materials on behalf of Company.  If the Chairman, President or
Chief Executive Officer of the Consultant shall happen to be serving in a management role with the Company at any time, then he shall not have the authority to represent both the Company and the Consultant as to the same contract or matter, nor to authorize the expenditure of funds of either the Company or the Consultant that benefit him personally, such as travel or living expenses, except as otherwise approved by the Board of the Company.

 

5. In consideration of Consultant’s entering into this Agreement, the Company has agreed to compensate the Consultant with a grant of Company stock options to purchase 850 shares of the common stock of the Company pursuant to a
Stock Option Agreement in substantially the form attached hereto as Exhibit B.

 

 

 

1

 

 

6. It is expressly acknowledged by the parties that Consultant will be an independent contractor and nothing in this Agreement will be construed to create an employer/employee relationship, an agency relationship, a joint venture relationship
or a partnership with Company.

 

7. Each of the parties covenants and agrees that it will comply with all applicable federal, state and local laws, rules and regulations and pertinent provisions of all contracts, permits and pertinent agreements to which it is a party
or is otherwise bound that relate to this Agreement.

 

8. Consultant shall be responsible for withholding, paying, and reporting any and all required federal, state or local income, employment and other taxes and charges.  Consultant understands and agrees that Company will make
no deduction from payments to Consultant for federal or state tax withholdings, social security, unemployment, workers’ compensation or disability insurance.

 

9. Consultant agrees that it will not without the Company’s consent disclose to anyone (other than its employees, officer, managers or agents assisting Consultant with the performance of its services hereunder) any trade secrets
of the Company or any confidential or non-public information relating to the Company’s business, operations or prospects.

 

10. This Agreement may be terminated by Company or Consultant without cause in their sole discretion by providing the other party with at least ninety (90) calendar days’ advance written notice (the “Notice
Period”).  If the Consultant terminates this Agreement without cause prior to the first anniversary of the commencement of the Term, then the Consultant shall forfeit and return to the Company any unexercised options that the Consultant shall have received pursuant to Paragraph 5 above.

 

11. It is understood and agreed by the parties that the services of Consultant are unique and personal in nature and the Consultant shall not delegate or assign all or any portion of its required performance to any non-affiliated individual,
firm or entity.

 

12. No waiver, amendment or modification of any provision of this Agreement shall be effective unless in writing and signed by both parties.  No failure or delay by either party in exercising any right, power or remedy under
this Agreement shall operate as a waiver of any such right, power or remedy.

 

13. This Agreement shall be binding upon and inure to the benefit of the heirs, successors, and assigns of the parties hereto.

 

14. Any notices, requests, demands and other communications required or permitted to be given under this Agreement will be in writing and, except as otherwise specified in writing, will be given by personal delivery, facsimile transmission,
express courier service or by registered or certified mail, postage prepaid, return receipt requested:

 

	
If to Company:  
	
6000 Uptown Blvd.

Suite 314

Albuquerque, NM 87110

Attn:  CD Hobbs

Telephone:  (505) 244-7600

Facsimile:  (505) 244-7658                                                   

 

 

	
If to Consultant:    
	
c/o Knox Lawrence International, LLC

445 Park Avenue, 20th Floor

New York, New York 10022

Attn: Nana Baffour

Telephone:  (212) 792-092

Facsimile:  (212) 792-09580                                               

 

 

 

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or to such other addresses as either party hereto may from time to time give notice of (complying as to delivery with the terms of this Section 14) to the other. Notice by registered or certified mail will be effective three days after deposit in the United States mail. Notice by any other permitted means will be effective upon receipt.

 

15. If any provision of this Agreement shall be held by a court of competent jurisdiction to be contrary to law, the remaining provisions of this Agreement shall remain in full force and effect.

 

16. This Agreement and the Exhibits attached hereto constitute the entire Agreement between the parties concerning the subject matter hereof and supersede all prior negotiations and discussions with respect to such subject matter.  This
Agreement may be modified in writing only, signed by the parties hereto.

 

17. The remedies hereunder shall be cumulative and not alternatives; the election of one remedy for a breach shall not preclude pursuit of other remedies.

 

18. Whenever required by the context, references herein to the singular shall include the plural and the masculine gender shall include the feminine gender.  For the purposes of this Agreement, unless the context clearly requires
otherwise, “or” is not exclusive and “including” shall mean “including, but not limited to.”

 

19. The section and other headings contained in this Agreement are for reference purposes only and shall not affect the interpretation of this Agreement.

 

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

 

[Remainder of page intentionally left blank]

 

 

 

3

 

 

[Signature page to Consulting Agreement]

 

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

 

 

	 	COMPANY	 
	 	UtiliPoint International, Inc.	 
	 	 	 	 
	
 
	
By: 
	/s/ CD Hobbs 	 
	 	 	Name: CD Hobbs  	 
	 	 	Title: Chief Executive Officer  	 
	 	 	 	 

 

	 	CONSULTANT	 
	 	KLI IP Holding Inc.	 
	 	 	 	 
	
 
	
By: 
	/s/ Nana Baffour 	 
	 	 	Name: Nana Baffour  	 
	 	 	Title: Managing Director 	 
	 	 	 	 

 

 

 

 

                                                                     

 

4

 

 

Exhibit A

 

UtiliPoint Procedures

 

[Attached hereto]

 

 

 

 

 

 

 

 

 

 

 

 

 

5

 

 

 

UtiliPoint Procedures

 

The Board of Directors of UtiliPoint International, Inc. recognizes that its board members, officers, and employees (“Personnel”) may be required to travel or incur other expenses from time to time to conduct ministry business and to further the mission  The purpose of this Policy is to ensure that (a) adequate cost
controls are in place, (b) travel and other expenditures are appropriate, and (c) to provide a uniform and consistent approach for the timely reimbursement of authorized expenses incurred by Personnel. It is the policy of UtiliPoint International, Inc. to reimburse only reasonable and necessary expenses actually incurred by Personnel.

When incurring business expenses, UtiliPoint expects Personnel to:

	
·  
	
Exercise discretion and good business judgment with respect to those expenses.

	
·  
	
Be cost conscious and spend money as carefully and judiciously as the individual would spend his or her own funds.

	
·  
	
Report expenses, supported by required documentation, as they were actually spent.

Expense Report

Expenses may not be reimbursed unless the individual requesting reimbursement submits a timely, written Expense Report. The Expense Report, which shall be submitted at least monthly must include:

	
•  
	
The individual’s name

	
•  
	
If reimbursement for travel is requested, the date, origin, destination and purpose of the trip, including a description of each organization-related activity during the trip.

	
•  
	
The name and affiliation of all people for whom expenses are claimed (i.e., people on whom money is spent (e.g., gifts, meals) in order to conduct [name of organization]’s business).

	
•  
	
An itemized list of all expenses for which reimbursement is requested.

Receipts

Receipts are requested for all expenditures.  No expense in excess of $20 will be reimbursed with approval to Personnel unless the individual requesting reimbursement submits with the Expense Report written receipts from each vendor showing the vendor’s name, a description of the services provided (if not otherwise obvious),
the date, and the total expenses, including tips (if applicable). A credit card receipt or statement may be used to document the vendor and date of an expense, provided other required details of the expenditure are fully documented.

Credit Cards

UtiliPoint does not currently have a corporate credit card, however if a corporate credit card is issued to personnel for travel (and other) organization-related expenses, the requirements for regular expense reports, explaining charges, as described above under “Expenses Reports” must still be met, and charges may not be made
for “Non-Reimbursable Expenditures” as described below. Failure to meet the Expense Report requirements, or making of inappropriate charges will result in loss of the credit card and Personnel will owe UtiliPoint for any “Non-Reimbursable Expenditures”.

 

 

 

6

 

General Travel Requirements

Necessity of Travel

In determining the reasonableness and necessity of travel expenses, Personnel and the person authorizing the travel shall consider the ways in which UtiliPoint will benefit from the travel and weigh those benefits against the anticipated costs of the travel. The same considerations shall be taken into account in deciding whether the benefits
outweigh the costs, less expensive alternatives, such as participation by telephone or video conferencing, or the availability of local programs or training opportunities, shall be considered.

Air Travel

General. Air travel reservations should be made as far in advance as possible in order to take advantage of reduced fares. Frequent Flyer Miles and Compensation for Denied Boarding. Personnel traveling on behalf of UtiliPoint may accept and retain frequent flyer miles and compensation for denied boarding for their personal use.

Lodging

Personnel traveling on behalf of UtiliPoint may be reimbursed at the single room rate for the reasonable cost of hotel accommodations. Convenience, the cost of staying in the city in which the hotel is located, and proximity to other venues on the individual’s itinerary shall be considered in determining reasonableness. Personnel
shall make use of available corporate and discount rates for hotels.

Out-Of-Town Meals

Personnel traveling on behalf of UtiliPoint are reimbursed on a per meal basis a when they actually incur the cost of a meal. They will not be reimbursed for meals paid for or provided by others.

Ground Transportation

Employees are expected to use the most economical ground transportation appropriate under the circumstances and should generally use the following, in this order of desirability:

Courtesy Cars. Many hotels have courtesy cars, which will take you to and from the airport at no charge. Employees should take advantage of this free service whenever possible. Another alternative may be a shuttle or bus.

Taxis. When courtesy cars and airport shuttles are not available, a taxi is often the next most economical and convenient form of transportation when the trip is for a limited time and minimal mileage is involved.

Rental Cars. Car rentals are expensive so other forms of transportation should be considered when practical. Employees will be allowed to rent a car while out of town provided that the cost is less than alternative methods of transportation.

 

 

 

7

 

Personal Cars

Personnel are compensated for use of their personal cars when used for business. When individuals use their personal car for such travel, including travel to and from the airport, mileage will be allowed at the currently approved IRS rate per mile.  In the case of individuals using their personal cars to take a trip that would
normally be made by air, mileage will be allowed at the currently approved rate; however, the total mileage reimbursement will not exceed the sum of the lowest available round trip coach airfare unless otherwise approved.

Parking/Tolls

Parking and toll expenses, including charges for hotel parking, incurred by Personnel traveling on organization business will be reimbursed. The costs of parking tickets, fines, car washes, etc., are the responsibility of the employee and will not be reimbursed. On-airport parking is permitted for short business trips. For extended trips,
Personnel should use off-airport facilities.

Entertainment and Business Meetings

Reasonable expenses incurred for business meetings or other types of business-related entertainment will be reimbursed only if the expenditures are approved and qualify as tax deductible expenses. Detailed documentation for any such expense must be provided, including:

 

•           Date and place of entertainment

•           Nature of expense

•           Name, titles, and corporate affiliation of those entertained

•           A complete description of the business purpose for the activity including the specific business matter discussed

•           Vendor receipts (not credit card receipts or statements) showing the vendor’s name, a description of the services provided, the date, and the total expenses, including tips (if applicable).

Client Reimbursed Travel

If there is any conflict between UtiliPoint’s travel and expense policy and a Client’s, the Client’s policy will be followed.  Personnel may, for example, fly business or first class as long as the Client agrees to reimburse for such an expense.

Other Expenses

Reasonable ministry-related telephone and fax charges due to absence of Personnel from the individual’s place of business are reimbursable. In addition, reasonable and necessary gratuities that are not covered under meals may be reimbursed.

Non-reimbursable Expenditures

UtiliPoint maintains a strict policy that expenses in any category that could be perceived as lavish or excessive may not be reimbursed at UtiliPoint’s discretion. Expenses that UtiliPoint has the right to deny unless prior approval is received from the reporting manager or UtiliPoint CEO, COO, or CFO include , but are not limited
to:

•           Travel insurance

•           First class tickets

•           Limousine travel

•           Membership dues at any country club, private club, athletic club, golf club, tennis club or similar recreational organization

•           Participation in or attendance at golf or  tennis tournaments, NASCAR races or other sporting events, without the advance approval of UtiliPoint’s CEO or his designee

•           Purchase of sporting equipment

•           Spa or exercise charges

•           Clothing purchases

•           Business entertainment

•           Car washes

•           Toiletry articles

•           Expenses for spouses, friends, or relatives. If a spouse, friend or relative accompanies Personnel on a trip, it is the responsibility of the Personnel to determine any added cost for double occupancy and related expenses and to make the appropriate adjustment in the
reimbursement request.

 

 

 

8

 

 

Exhibit B

 

Stock Option Agreement

 

[Attached hereto]

 

 

4815-0860-5700, v.  5

 

 

 

 

 

 

 

 

 

 

 

 

 

9

 

 

UtiliPoint International, Inc.

 

STOCK OPTION AGREEMENT

This STOCK OPTION AGREEMENT (the “Agreement”) is made and entered into effective as of the 1st day of July, 2009 (“Grant Date”) by and between UtiliPoint International, Inc. (“UtiliPoint”), a New Mexico corporation, and KLI IP Holding Inc., a Delaware corporation
having a business address at Knox Lawrence International, LLC, 445 Park Avenue, 20th Floor, New York, NY 10022 (“Optionee”).

WHEREAS Optionee is a consultant to UtiliPoint and;

WHEREAS UtiliPoint desires to grant to Optionee the option to acquire up to eight hundred fifty (850) shares of UtiliPoint’s common stock in accordance with the terms and conditions set forth herein.

NOW THEREFORE, in consideration of the premises herein contained and the benefits to be derived from the mutual observance of the covenants hereinafter set forth, the parties to this Agreement agree as follows:

 

1.           GRANT OF OPTION.  SUBJECT TO ANY VESTING PROVISIONS SET FORTH HEREIN, UTILIPOINT HEREBY GRANTS TO OPTIONEE, AND THE OPTIONEE ACCEPTS ON THE TERMS SET FORTH IN THIS AGREEMENT, AN OPTION (THE “OPTION”)
TO PURCHASE A TOTAL OF EIGHT HUNDRED FIFTY (850) SHARES OF UTILIPOINT'S COMMON STOCK (THE “OPTION SHARES”).  THIS OPTION IS NOT GRANTED UNDER THE COMPANY’S STOCK OPTION AGREEMENT “2009 PLAN”.

2.           Option Vesting Dates. Upon the execution of this Agreement by UtiliPoint and the Optionee, Optionee shall become fully vested with the right, but not the obligation, to exercise this Option and to purchase
the Option Shares at any time on and after the Grant Date.

3.           [Reserved].

4.           Exercise of Option.  Optionee may purchase any or all of the Option Shares at any time during the Option Term (as hereinafter defined) all or any portion of the Option Shares.

5.           Term of Option.  The term of this Agreement (the “Option Term”) shall commence on the Grant Date and shall expire on the fifth anniversary of the Grant Date (the “Termination Date”).  To
the extent that Optionee shall not have exercised his right to purchase all of the Option Shares in which it has acquired a vested option right (the “Option Right”) prior to the Termination Date, such Option Right shall expire and become null and void.

6.           Exercise Price.  The exercise price to be paid by Optionee for each of the Option Shares (the “Exercise Price”) to be acquired hereunder shall be Fifty Dollars ($50), the indicated estimated
fair market value of a common share of UtiliPoint as of the Grant Date.  The Optionee may chose to pay the Exercise Price, in his sole discretion, as follows:

(a) in cash at the time of exercise,

 

(b) Net Exercise Rights. Notwithstanding the payment provisions set forth in this Section, the Optionee may elect to receive the number of Option Shares equal to the value (as determined below) of this Option by surrender of this Option
at the principal office of UtiliPoint together with notice of such election, in which event UtiliPoint shall issue to the Optionee the number of shares of Common Stock determined by use of the following formula:

 

 

	  X =	Y(A-b)	 
	 	A 	 

 

 

	
Where:
	

X = the number of shares of Common Stock to be issued to the Optionee.

Y = the number of shares of Option Share subject to this Option.

A = the Fair Market Value (as defined below) of one (1) Option Share.

B = Exercise Price per Option Share.

 

For purposes of this Agreement, “Fair Market Value” of an Option Share as of a particular date shall mean:(i)If the UtiliPoint common shares are registered under the Securities and Exchange Act of 1933, as amended, and traded on a securities exchange or electronic trading network, then the Fair Market Value of a share shall
be the closing price (the last reported sales price, if not so reported, the average of the last reported bid and asked prices) of the UtiliPoint's common stock as of the last business day immediately prior to the exercise of this Option.(ii)If UtiliPoint's common shares are not so registered, then the Fair Market Value of a share of Common Stock shall be the value of the consideration upon the closing of an acquisition; fair value as per UtiliPoint's board or, if the Optionee objects within 10 day of notice
of the board’s Fair Market Value determination, an independent valuation expert mutually acceptable to the parties shall be engaged to determine the Fair Market Value.

 

(c)           in such other manner as may be determined by the Compensation Committee (the “Committee”) appointed by the Board of Directors of UtiliPoint.

(d)           Upon surrender of this Option, and a duly and executed form of Shareholder Agreement, and payment of the Exercise Price, UtiliPoint shall cause to be issued and delivered to the Optionee or such other person as the Optionee
may designate in writing a certificate(s) for the number of full Option Shares so purchased upon the exercise of this Option.  Such certificate(s) shall be deemed to have been issued and any person so designated to be named therein shall be deemed to have become a holder of record of the Option Shares as of the date of the surrender of this Option, and the duly completed and executed Shareholder Agreement, and payment of the Exercise Price.  If this Option is exercised in part, a new Option
certificate of the same tenor and for the number of Option Shares not exercised shall be executed by UtiliPoint.

7.           Common Stock Restrictions.  Optionee acknowledges that any Option Shares which are acquired under this Agreement shall become subject to the restrictions set forth in UtiliPoint’s standard
“Stockholder Agreement” (a copy of which is attached hereto as Exhibit A), which shall be executed by UtiliPoint and the Optionee no later than the Optionee’s first exercise of an Option under this Agreement.

8.           Transferability.  This Option and the rights evidenced by this Agreement are not transferable and may be exercised only by Optionee and only in accordance with the terms contained herein.  More
particularly (but without limiting the generality of the foregoing), the Option may not be assigned, transferred, pledged or hypothecated in any way except as provided herein, shall not be assignable by operation of law, and shall not be subject to execution, attachment or similar process.  Any attempted assignment, transfer, pledge, hypothecation or other disposition of the Option contrary to the provisions hereof, or the levy of any execution, attachment or similar process upon the Option, shall be
null and void and without effect.

9.           Tax Withholding.  The exercise of this Option may result in the potential creation of taxable income to the Optionee in an amount equal to the difference between the Fair Market Value of the shares
acquired as of the date of exercise of the Option and the Exercise Price.  Any exercise of Option rights pursuant to the terms of this Option shall be subject to withholding of federal and state income taxes, FICA taxes, or such other taxes to the extent required by applicable law.  UtiliPoint’s failure to withhold such taxes does not diminish or eliminate responsibility of Optionee to pay such taxes when due or assessed.

 

 

 

10

 

10.           General Provisions.

a.           Controlling Law.  This Agreement shall be construed in accordance with, and interpreted pursuant to, the laws of the State of New Mexico.

b.           Headings.  The headings in this Agreement are intended solely for convenience of reference and shall be given no effect in the construction or interpretation of this Agreement.

c.           Binding Effect.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, personal representatives, successors, and assigns.

d.           Entire Agreement.  This Agreement constitutes the entire agreement between the parties hereto in connection with the subject matter itself.  This Agreement supersedes any and all previous
agreements, either oral or written, between the parties hereto with respect to the subject matter hereof.  This Agreement may not be modified orally, and no modification shall be effective unless in writing and signed by all parties hereto.

e.           Savings Clause.  If any one or more provisions of this Agreement shall be adjudged or declared illegal or unenforceable, the same shall not in any way affect or impair the validity or enforceability
of all or any other provision of this Agreement.

f.           No impairment.  UtiliPoint will not, by amendment of its Articles of Incorporation or Bylaws, or the 2009 Stock Investment Plan, or through reorganization, consolidation, merger, dissolution, issue
or sale of securities, sale of assets or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Option, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the Optionee against impairment.  Without limiting the generality of the foregoing, UtiliPoint (a) will not increase the par value of any shares of stock issuable
upon the exercise of this Option above the amount payable therefor upon such exercise, and (b) will take all such action as may be necessary or appropriate in order that UtiliPoint may validly and legally issue fully paid and non-assessable Option Shares upon exercise or exchange of this Option.

 

g.           Adjustments.  Notwithstanding any other agreement, in any event of change in the outstanding Common Stock of UtiliPoint International, Inc. by reason of stock dividend or distribution, recapitalization,
merger, consolidation, split-up, stock split, combination, exchange of shares or the like, this Option Agreement shall be appropriately adjusted as to the number of shares of Common Stock subject to this Option, the Exercise Price of Options and any and all other matters related to this Option Agreement.

 

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

 

 

 

 

	 UTILIPOINT INTERNATIONAL, INC. 	 	 “OPTIONEE”
	 	 	 
	 /s/ CD Hobbs	 	 /s/ Nana Baffour
	By:  CD Hobbs  	 	KLI IP Holding, Inc.
	Its:  Chief Executive Officer 	 	By:  Nan Baffour

 

                                                                                              

 

 

11

 

                                                                                              

                                                                                  

Exhibit A

Stockholders Agreement

4835-1694-5156, v.  1

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