Document:

UNITED STATES

Exhibit
10.2

Member FINRA/SIPC

488
East Winchester Street, Ste 200

Salt Lake City, UT 84107

Phone
(801) 320-9606

Fax (801) 320-9610

November 1, 2011

Mr. Rod Danielson

Summer Energy

800 Bering Drive Suite 260

Houston, Texas 77057

          Re:
Advisory Agreement

Dear
Mr. Danielson:

          This
letter confirms the terms upon which Summer Energy, LLC, together with all
subsidiaries, affiliates, successors and other controlled units, either
existing or formed subsequent to the date of this letter (the "Company")
engages and retains Cambria Capital, LLC ("Cambria") to act as the
exclusive advisor for the Company with respect to certain financial advisory,
investment banking and related matters.
Cambria is a broker dealer duly registered with the Securities and
Exchange Commission and is a member in good standing of the Financial Industry
Regulatory Authority.  This advisory
agreement (this "Agreement") will be deemed to be effective as of the
date set forth above.

          1.
Services. In connection
with its engagement hereunder, Cambria agrees to use its best efforts to assist
the Company by:

          (a)
Reviewing of the Company's business, operations and financial condition,
including advising the Company on capitalization structures and financing
alternatives, 

          (b)
indentifying a reverse merger candidate with an existing public company

          (c)
introducing potential board member(s) to the Company;              

          (d)
upon request, provide the Company, its management and its board of directors with
actionable advice regarding (i) capital markets strategy, (ii) market
conditions, (iii) the availability of capital and the advisability of accessing
the capital markets, and (iv) how the Company can best achieve its strategic
objectives; 

          (e)
acting as the sole or lead placement agent
to provide capital through potential financings ("Transaction") which
may consist of equity, debt and other securities; and 

  

          (f)
provide such other investment banking and financial advisory services as may be
mutually agreed upon by the Company and Cambria.

          2.
Compensation and Expense Reimbursement. As compensation for Advisor's
services hereunder, the Company hereby agrees to pay Advisor:

          (a)
a warrant (the "Retainer Warrant") granting Cambria the right to
purchase 400,000 shares of the Company's common stock. The Warrant shall have
an exercise price of $0.60 per share. The Warrant will contain customary terms
and conditions, including, without limitation, provisions for cashless exercise,
change of control, anti-dilution (including price-based anti-dilution) and
customary registration rights. The term of the Warrant will be seven (7) years
and the Warrant will be fully assignable, in whole or in part, to one or more
parties by Cambria. The shares of common stock covered by the Warrant shall all
vest upon execution of the Warrant; and

          (b)
Success Fee for potential financing(s) pursuant to section 1(e) above.  

                    (i)
Cash Fee.  Ten percent (10%) of
the gross proceeds of the Transaction, including proceeds received by the
Company at any future date in connection with the exercise by Investors of
warrants issued in the Transaction.   

                    (ii)
Warrants.  A warrant (the "Warrant")
granting Cambria the right to purchase shares of common stock equal to ten
percent (10%) of the number of shares of common stock (collectively, the "Transaction
Shares") issued by the Company in the Transaction and common stock issued
by the company upon the Investors' exercise of the Warrants issued in the
Transaction (but only earned by and issued to Cambria upon the exercise of such
Warrants).  The number of shares covered by the Warrant
shall be increased proportionately from time to time in the event that the
Company increases the number of Transaction Shares issued in the
Transaction.  The Warrant will have an
exercise price equal to the lower of the issue price or conversion price of the
common stock or securities convertible into common stock in the Transaction, and
will be adjusted downward to match such issue price or conversion price if such
prices are adjusted downward in the future.
The Warrant will contain customary terms and conditions, including
without limitation, provisions for cashless exercise, change of control,
anti-dilution (including price-based anti-dilution) and customary demand and
piggyback registration rights.   The
term of the Warrant will be five (5) years and will be fully assignable to one
or more parties by Cambria.  The shares
of common stock covered by the Warrant shall all vest upon the execution of the
Warrant.

                    (iii)
Expenses.  The Company shall pay
Cambria at the closing of the Transaction a non-accountable expense allowance
equal to three percent (3%) of the gross proceeds (the "Expense Allowance")
received in the Transaction.  Upon
agreement of the Transaction terms, the Company will pay to Cambria a
non-refundable advance (the "Expense Deposit") of the Expense Allowance
equal to $10,000 (which will be credited against the Expense Allowance at the
closing). The Expense Allowance will cover all out-of-pocket costs and expenses
directly incurred by Cambria in performing its obligations under this
Agreement, which costs and expenses shall include, but not be limited to,
travel expenses incurred in performing due diligence, legal fees and expenses,
fees and expenses of any independent experts retained by Cambria, investor
marketing expenses, costs of supplies, copying and mailing and all other
expenses reasonably incurred by Cambria and its legal counsel in any
preparation, review, completion and distribution of any private placement
memoranda, offering materials and stock purchase documents related to the
Transaction, and any background investigations of key management and other
reasonable expenses related to the completion of the Investors' due diligence
(collectively, the "Expenses").
In the event that a Transaction does not occur or close, Cambria will
invoice the Company for such Expenses not already covered by the Expense
Deposit, subject to an overall cap of $20,000, and the Company will pay such
invoice within five (5) business days of its receipt thereof.

2

  

          The
Success Fee will be payable regardless of the size of the Transaction and
whether or not the Transaction occurs in one transaction or a series of
transactions.  The Success Fee shall be
payable in cash upon consummation of, and out of the proceeds of, the proposed
Transaction.

          (c)
Fee Tail.  For the 18-month
period after the termination of this Agreement, the Success Fee shall be due
and owing Cambria for all investments in or for the benefit of the Company
(including but not limited to senior or subordinated debt or equity securities)
by any Potential Investor (i) introduced to the Company by Cambria, or (ii)
contacted by Cambria pursuant to this Agreement, or (iii) in respect of which
Cambria has rendered advice or with which Cambria has directly held initial
discussions or furnished information regarding the Company or the Transaction.            

          3.
Term and Termination of Agreement; Right of First Refusal.  

          (a)
It is understood that the Company hereby engages Cambria on an exclusive basis
for investment banking services for a term (the "Term") commencing on
the date hereof and ending twelve (12) months after the date hereof.  The Term shall be automatically renewed for
successive 30 day periods unless either party gives written notice to the other
within 30 days of the expiration of the Term of its desire that this engagement
expire.  Notwithstanding the foregoing,
Cambria may at its sole option, terminate its obligations hereunder without
liability if, in the reasonable opinion of Cambria, a change has occurred in
the Company's financial condition, results of operations, properties, business
prospects, or the composition of the Company's management or Board of
Directors, which, in Cambria's sole determination has adversely effected the
marketability of the Company. Neither termination of this Agreement nor
completion of the assignment contemplated hereby shall affect: (i) any
compensation earned by Cambria up to the effective date of termination or
completion, as the case may be, (ii) any compensation to be earned by Cambria
after termination pursuant to Section 2(a) hereof, (iii) the
reimbursement of expenses incurred by Cambria under Section 2(b) up to
the date of termination or completion, as the case may be, and (iv) the
provisions of Section 5(a) of this Agreement which are incorporated
herein, all of which shall remain operative and in full force and effect.  Upon termination of this Agreement for any
reason, Cambria shall promptly return to the Company all copies of any
proprietary information of the Company.

          (b)
During the first twenty four (24) months following the successful closing of
the Transaction described herein, Cambria shall have a right of first refusal
to act as the sole or lead placement agent and manager with respect to any
future offering by the Company of public or private debt or equity securities,
or to act as an advisor on any merger, business combination, recapitalization
or sale of some or all of the equity or assets of the Company.   In the event Cambria is engaged by the
Company to provide such future services, Cambria will be compensated as is
reasonable and customary within the industry, with this Agreement serving as
the basis for such compensation.

          4.
Information Provided to Cambria.

          (a)
The Company agrees to cooperate with Cambria and will furnish to Cambria all information
and data concerning the Company (the "Information"), which Cambria
reasonably deems appropriate for purposes of rendering its services hereunder,
and will provide Cambria access to the Company's officers, directors, employees
and advisors.   The Company represents
and warrants that all Information (a) made available to Cambria by the Company
or (b) contained in any filing by the Company with any court or governmental
regulatory agency, commission, or instrumentality will, at all times during the
period of the engagement of Cambria hereunder, be complete and correct in all
material respects and will not contain any untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements
therein not misleading.  The Company
further represents and warrants that any projections provided by it to Cambria
will have been prepared in good faith and will be based upon assumptions which,
in light of the circumstances under which they are made, are reasonable.  The Company acknowledges and agrees that, in
rendering its services hereunder, Cambria will be using and relying on the
Information (and information available from public sources and other sources
deemed reliable by Cambria) without independent verification thereof by Cambria
or independent appraisal by Cambria of any of the Company or the Company's
assets, and Cambria will not in any respect be responsible for the truth,
accuracy, or completeness of such information.
Any advice rendered by Cambria pursuant to this Agreement may not be
disclosed publicly without Cambria's prior written consent.  The Company agrees to promptly notify
Cambria if the Company believes that any information that was previously
provided to Cambria has become materially misleading or inaccurate in any way. 

3

  

          (b)
Cambria acknowledges that all of such Information is proprietary to the Company
and agrees to keep such Information confidential and not to disclose any of
such Information to any third party, except for third parties to whom Cambria
shall present such Information for purposes of evaluation of the Transaction
pursuant to this Agreement.

          5.
Indemnity; Best Efforts and Limitation of Liability.  

          (a)
The Company agrees to indemnify and hold harmless Cambria and its affiliates,
and the respective directors, officers, shareholders, members, employees,
agents and controlling persons of Cambria and its affiliates within the meaning
of either Section 15 of the Act, or Section 20 of the Securities and Exchange Act
of 1934, as amended (collectively, the "Cambria Indemnified Parties"),
to the fullest extent lawful, against any and all losses, damages, liabilities,
costs, and expenses, joint or several, to which the Cambria Indemnified Parties
may become subject arising out of or related to any claim, demand, or cause of
action (whether civil, criminal, or regulatory in nature) made or threatened by
any third party against any of the Cambria Indemnified Parties or Cambria as a
result of or based upon any information provided to the Cambria Indemnified
Parties by the Company or actions allegedly or actually taken or omitted to be
taken by a Cambria Indemnified Party (including acts or omissions constituting
negligence) pursuant to the terms of, or in connection with services rendered
pursuant to, this Agreement, and the Company further agrees to fund the
reasonable legal fees and expenses of the Cambria Indemnified Parties for legal
counsel of Cambria's choosing, in advance, upon demand by Cambria, and to
reimburse the Cambria Indemnified Parties for any other expenses reasonably
incurred by them in respect thereof at the time such expenses are incurred;
provided, however, the Company shall not be liable under the foregoing in
respect of any loss, damage or liability if a court having jurisdiction shall
have determined by a final judgment that such loss, damage or liability
resulted primarily from the willful misconduct of the Cambria Indemnified
Parties.  Neither termination nor completion
of the engagement of Cambria as described herein shall affect the terms of this
Section 5, which shall then remain operative and in full force and
effect.

          (b)
Cambria will use commercially reasonable efforts to assist the Company in
effectuating the closing of the Transaction, but there can be no guaranty or
assurance that the Transaction will close.
It is expressly understood and acknowledged that Cambria's
engagement in respect of the Transaction does not constitute any commitment,
express or implied, on the part of Cambria or of any of its affiliates to
purchase or place the Company's securities or to provide any type of financing
and that Cambria's efforts in connection with the Transaction will be conducted
by Cambria on a "best efforts" basis. It is further understood that Cambria's
services hereunder shall be subject to, among other things, satisfactory
completion of due diligence by Cambria, market conditions, the absence of
adverse changes to the Company's business or financial condition, approval of
Cambria's internal commitment committee and any other conditions that Cambria
may deem appropriate for placements of such nature.  Neither Cambria
nor any of its affiliates (nor any of their respective control persons,
directors, officers, employees, members or agents) shall be liable to the
Company or to any other person claiming through the Company for any claim,
loss, damage, liability or expense suffered by the Company or any such person
arising out of related to the failure of the Transaction to close.  The final amount of the Transaction will
vary subject to market conditions. 

4

  

          6.
Business Practice. The Company recognizes that Cambria is in the
business of advising and consulting with other businesses, some of which
businesses may be in competition with the Company. The Company acknowledges and
agrees that Cambria may advise and consult with other businesses, including
those which may be in competition with the Company, and shall not be required
to devote its full time and resources to performing services on behalf of the
Company under this Agreement. Cambria shall only be required to expend such
time and resources as are reasonably appropriate to advise and assist the
Company as provided for herein. Cambria agrees to not represent any direct
competitor of the Company during the term of this Agreement and for a period of
6 months after termination. 

          7.
Certain Representations by the Company.    The Company represents to Cambria that the Company has
not engaged in any public or private offering of securities or taken or failed
to take any action that would cause any financing not to qualify for an
applicable exemption from registration under the Act.  Further, the Company agrees not to solicit any offerees or take
any action which might jeopardize the availability of exemption under the
Act.   The Company further represents to
Cambria that it has not engaged the services of any third-party finder, and
that no fees or expenses are owed to any third-party finder in connection with
this Agreement or the Transaction.  The
Company further represents and warrants that there is no third-party claim or
interest in the Success Fee to be paid under this Agreement.  The Company further agrees that it shall be
solely responsible for the payment of any such third-party finders' fees and
expenses, to the extent that a claim for such third-party finders' fees and
expenses is successfully asserted.

          8.
Miscellaneous.

          (a)
This Agreement shall be governed and construed in all respects in accordance
with the laws of the State of California and venue shall be proper in
California, Utah or Texas.  

          (b)
Cambria and Company hereby irrevocably agree that any controversy arising out
of or relating to this Agreement in connection with a transaction between
Cambria and the Company or pursuant to this Agreement or the breach hereof
shall be settled by arbitration in Los Angeles County, California in accordance
with the Commercial Arbitration Rules then in effect of the American
Arbitration Association.   The
provisions of Section 1283.05 of the California Code of Civil Procedure,
authorizing the taking of depositions and obtaining discovery, are incorporated
herein by this reference and shall be applicable to any such arbitration.

          (c)
The parties are and shall be engaged in an independent contractor relationship,
and nothing herein shall be deemed to cause this Agreement to create an agency,
partnership, or joint venture between the parties. Nothing in this Agreement
shall be interpreted or construed as creating or establishing the relationship
of employer and employee between the Company and Cambria.   Cambria is not and will not be construed as
a fiduciary of the Company or any affiliate thereof and will have no duties or
liabilities to the equity holders, creditors, or affiliates of the Company or
any other person by virtue of this Agreement and the retention of Cambria
hereunder, all of which duties and liabilities are hereby expressly waived.
Neither equity holders nor creditors of the Company are intended beneficiaries
hereunder.

5

  

          (d)
All remedies available to either party for one or more breaches by the other
party are and shall be deemed cumulative and may be exercised separately or
concurrently without waiver of any other remedies. The failure of either party
to act in the event of a breach of this Agreement by the other shall not be
deemed a waiver of such breach or a waiver of future breaches, unless such
waiver shall be in writing and signed by the party against whom enforcement is
sought.

          (e)
All notices required or permitted hereunder shall be in writing addressed to
the respective parties as set forth herein, unless another address shall have
been designated, and shall be delivered by hand or by registered or certified
mail, postage prepaid.  

	
   

  	
   

  
	
   

  	
  If to Cambria:

  
	
   

  	
  Cambria Capital, LLC

  
	
   

  	
  488 East Winchester
  Street, Ste 200

  
	
   

  	
  Salt Lake City, UT 84107

  
	
   

  	
  Phone:  801.320.9606; Fax:  801.320.9610

  
	
   

  	
   

  
	
   

  	
  If to the Company:

  Summer Energy

  800 Bering Drive Suite 260

  Houston, Texas 77057

  Phone:  713-375-2791; Fax:
  866-777-9189  

  

          (f)
For the convenience of the parties, any number of counterparts of this
Agreement may be executed by the parties hereto.  Each such counterpart shall be, and shall be deemed to be, an
original instrument, but all of such counterparts taken together shall
constitute one and the same Agreement.
This Agreement may not be modified or amended, except in writing signed
by the parties hereto.  This Agreement
constitutes the entire agreement of the parties hereto and supersedes all prior
representations, proposals, discussions, and communications, whether oral or in
writing.  Facsimile signatures to this
Agreement are valid, and each party may rely on such facsimile signatures as if
such signature was an original signature.

          (g)
Each party has all requisite corporate power and authority to execute and
perform this Agreement, all corporate action necessary for the authorization,
execution, delivery and performance of this Agreement has been taken by each
party, and this Agreement constitutes a valid and binding obligation of each
party.  The execution and performance of
this Agreement by each party (and the offer and sale of the Company's
securities) will not violate any provision of such party's charter or bylaws or
any agreement or other instrument to which such party is a party or by which it
is bound; and any necessary approvals, governmental and private, required to
fulfill each party's obligations under this Agreement will be obtained by such
party.

6

  

If
the foregoing correctly sets forth your understanding of our agreement, please
sign the enclosed copy of this letter and return it to Cambria, whereupon it
shall constitute a binding agreement between us.  

	
   

  	
   

  	
   

  
	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
  CAMBRIA CAPITAL, LLC

  
	
   

  	
   

  	
  

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Joel M Vanderhoof

  
	
   

  	
   

  	
  Executive Vice President
  of Sales

  

The undersigned hereby accepts, agrees to and
becomes party to the foregoing letter agreement, effective as of the date first
written above.

Summer
Energy, LLC

	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Rod Danielson

  	
   

  
	
   

  	
            Rod
  Danielson, Chief Executive Officer 

  	
   

  

7ex_10-3.htm

Exhibit 10.3 

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. SUCH SECURITIES MAY NOT BE SOLD OR OTHERWISE TRANSFERRED EXCEPT AS PERMITTED UNDER THE SECURITIES ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR AN EXEMPTION THEREFROM. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL (WHICH MAY BE COUNSEL FOR THE COMPANY) IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE SECURITIES ACT. 

SUBJECT TO THE PROVISIONS OF SECTION 10 HEREOF, THIS WARRANT SHALL BE VOID AFTER 5:00 P.M. EASTERN TIME ON JANUARY 17, 2019, (THE "EXPIRATION DATE"). 

	
 

	
 

	
No. 01

	
January 17, 2012

SUMMER ENERGY, LLC

WARRANT TO PURCHASE 400,000 UNITS

OF MEMBERSHIP INTEREST

FOR VALUE RECEIVED, Cambria Capital, LLC, a California limited liability company ("Warrantholder"), is entitled to purchase, subject to the provisions of this Warrant (the "Warrant"), from Summer Energy, LLC, a Texas limited liability company ("Company"), at any time from and after the date which is one (1) year from the date of closing of that certain Agreement and Plan of Contribution by and among the Company, its members and Castwell Precast Corporation (the "Initial Exercise Date") and not later than 5:00 P.M., Eastern time, on the Expiration Date (as defined above), at an exercise price per unit equal to $0.60 (the exercise price in effect being herein called the "Warrant Price"), 400,000 units ("Warrant Units") of the Company's membership interest ("Units"). Warrantholder has provided certain financial advisory services, and Company has agreed to issue this Warrant to Warrantholder as part of the consideration for such services. The number of Warrant Units purchasable upon exercise of this Warrant and the Warrant Price shall be subject to adjustment from time to time as described herein. 

          Section 1. Registration. The Company shall maintain books for the transfer and registration of the Warrant. Upon the initial issuance of this Warrant, the Company shall issue and register the Warrant in the name of the Warrantholder. 

          Section 2. Transfers. As provided herein, this Warrant may be transferred only pursuant to a registration statement filed under the Securities Act of 1933, as amended (the "Securities Act"), or an exemption from such registration. Subject to such restrictions, the Company shall transfer this Warrant from time to time upon the books to be maintained by the Company for that purpose, upon surrender hereof for transfer, properly endorsed or accompanied by appropriate instructions for transfer and such other documents as may be reasonably required by the Company, including, if required by the Company, an opinion of its counsel to the effect that such transfer is exempt from the registration requirements of the Securities Act, to establish that such transfer is being made in accordance with the terms hereof, and a new Warrant shall be issued to the transferee and the surrendered Warrant shall be canceled by the Company. 

 

  

          Section 3. Exercise of Warrant. 

          (a) Subject to the provisions hereof, the Warrantholder may exercise this Warrant, in whole or in part, at any time after the Initial Exercise Date and prior to the Expiration Date upon surrender of the Warrant, together with delivery of a duly executed Exercise Agreement, in the form attached hereto as Appendix A (the "Exercise Agreement") and payment by cash, certified check or wire transfer of funds, or pursuant to a cashless exercise pursuant to Section 3(b) below, of the aggregate Warrant Price for that number of Warrant Units then being purchased, to the Company during normal business hours on any business day at the Company's principal executive offices (or such other office or agency of the Company as it may designate by notice to the Warrantholder). The Warrant Units so purchased shall be deemed to be issued to the Warrantholder or the Warrantholder's designee, as the record owner of such units, as of the close of business on the date on which this Warrant shall have been surrendered (or the date evidence of loss, theft or destruction thereof and security or indemnity satisfactory to the Company has been provided to the Company), the Warrant Price shall have been paid and the completed Exercise Agreement shall have been delivered. Certificates for the Warrant Units so purchased shall be delivered to the Warrantholder within a reasonable time, not exceeding seven (7) business days, after this Warrant shall have been so exercised. The certificates so delivered shall be in such denominations as may be requested by the Warrantholder and shall be registered in the name of the Warrantholder or such other name as shall be designated by the Warrantholder, as specified in the Exercise Agreement. If this Warrant shall have been exercised only in part, then, unless this Warrant has expired, the Company shall, at its expense, at the time of delivery of such certificates, deliver to the Warrantholder a new Warrant representing the right to purchase the corrected number of units with respect to which this Warrant shall not then have been exercised. As used herein, "business day" means a day, other than a Saturday or Sunday, on which banks in New York City, New York are open for the general transaction of business. 

          (b) Subject to the provisions hereof, the Warrantholder may effect one or more cashless exercises by surrendering Warrants to the warrant agent or such other agent as designated by the Company and giving written notice that the Warrantholder wishes to effect a cashless exercise by surrendering some Warrants without exercise, upon which the Company shall issue, or cause to be issued, to the Warrantholder up to the number of Warrant Units determined as follows: 

2

 

  

	
 

	
 

	
 

	
 

	
 

	
X

	
=

	
Y x (A-B)/A

	
 

	
 

	
 

	
 

	
 

	
where:

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
X

	
=

	
the maximum number of Warrant Units that may be issued to the Warrantholder;

	
 

	
 

	
 

	
 

	
 

	
Y

	
=

	
the number of Warrant Units with respect to which the Warrant Certificates are being exercised;

	
 

	
 

	
 

	
 

	
 

	
A

	
=

	
the Market Price as of the Date of Exercise; and

	
 

	
 

	
 

	
 

	
 

	
B

	
=

	
the Exercise Price.

	
 

	
 

	
 

	
 

	
 

	
"Market Price" of a Unit on any date shall mean, (i) if the Units are listed on any national securities exchange, the last sale price of the Units reported by such exchange on that date; (ii) if the Units are not quoted on a any such market or listed on any such exchange and the Units are traded in the over-the-counter market, the last price reported on such day by the OTC Bulletin Board; (iii) if the Units are not quoted on any such market, listed on any such exchange or quoted on the OTC Bulletin Board, then the last price quoted on such day in the over-the-counter market as reported by the National Quotation Bureau Incorporated (or any similar organization or agency succeeding its functions of reporting prices); or (iv) if none of clauses (i)-(iii) are applicable, then as determined by mutual agreement of the Company and the Warrantholder; or if the Company and the Warrantholder are unable to agree on a Market Price, either party may submit the matter to arbitration as provided in Section 17.

	
 

	
 

	
 

	
"Date of Exercise" means the date on which the Company has received from Warrantholder (i) the Warrant, (ii) the Exercise Agreement signed by Warrantholder, indicating the number of Warrant Units to be purchased, and (iii) payment by cash, certified check or wire transfer of funds, or pursuant to a cashless exercise pursuant to Section 3(b) below, of the aggregate Warrant Price for that number of Warrant Units then being purchased.

          (c) Company's Failure to Timely Deliver Securities. If within seven (7) business days after the Company's receipt of the facsimile copy of an Exercise Notice the Company shall fail to issue and deliver a certificate to the Warrantholder and register such Units on the Company's share register or credit the Warrantholder's balance account with the Depository Trust & Clearing Corporation for the number of Units to which the Warrantholder is entitled upon the Warrantholder's exercise hereunder or pursuant to the Company's obligation set forth in clause (ii) below, and if on or after such business day the Warrantholder purchases (in an open market transaction or otherwise) Units to deliver in satisfaction of a sale by the Warrantholder of Units issuable upon such exercise that the Warrantholder anticipated receiving from the Company (a "Buy-In"), then the Company shall, within six (6) business days after the Warrantholder's written request and in the Warrantholder's discretion, either (i) pay cash to the Warrantholder in an amount equal to the Warrantholder's total purchase price (including brokerage commissions, if any) for the Units so purchased (the "Buy-In Price"), at which point the Company's obligation to deliver such certificate (and to issue such Units) or credit such Warrantholder's balance account with DTC shall terminate, or (ii) promptly honor its obligation to deliver to the Warrantholder a certificate or certificates representing such Units or credit such Warrantholder's balance account with DTC and pay cash to the Warrantholder in an amount equal to the excess (if any) of the Buy-In Price over the product of (A) such number of Units, times (B) the Market Price on the date of exercise. 

3

 

  

          Section 4. Restrictions. Warrantholder acknowledges that neither this Warrant, nor the Warrant Units will be registered under the Securities Act and, accordingly, will be "restricted securities" as that term is defined by Rule 144(a)(3) of the General Rules and Regulations Promulgated under the Securities Act. The Company may cause the legend set forth on the first page of this Warrant to be set forth on each Warrant, and a similar legend on any security issued or issuable upon exercise of this Warrant, unless counsel for the Company is of the opinion as to any such security that such legend is unnecessary. 

          Section 5. Payment of Taxes. The Company will pay any documentary stamp taxes attributable to the initial issuance of Warrant Units issuable upon the exercise of the Warrant; provided, however, that the Company shall not be required to pay any tax or taxes which may be payable in respect of any transfer involved in the issuance or delivery of any certificates for Warrant Units in a name other than that of the Warrantholder in respect of which such units are issued, and in such case, the Company shall not be required to issue or deliver any certificate for Warrant Units or any Warrant until the person requesting the same has paid to the Company the amount of such tax or has established to the Company's reasonable satisfaction that such tax has been paid. The Warrantholder shall be responsible for income taxes due under federal, state or other law, if any such tax is due. 

          Section 6. Mutilated or Missing Warrants. In case this Warrant shall be mutilated, lost, stolen, or destroyed, the Company shall issue in exchange and substitution of and upon surrender and cancellation of the mutilated Warrant, or in lieu of and substitution for the Warrant lost, stolen or destroyed, a new Warrant of like tenor and for the purchase of a like number of Warrant Units, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction of the Warrant, and with respect to a lost, stolen or destroyed Warrant, reasonable indemnity or bond with respect thereto, if requested by the Company. 

          Section 7. Reservation of Units. At any time when this Warrant is exercisable, the Company shall at all applicable times keep reserved until issued (if necessary) as contemplated by this Section 7, out of the authorized and unissued Units, at least a number of Units equal to the number of Units as shall from time to time be necessary to effect the exercise of all of this Warrant then outstanding. The Company agrees that all Warrant Units issued upon due exercise of the Warrant shall be, at the time of delivery of the certificates for such Warrant Units, duly authorized, validly issued, fully paid and non-assessable Units of the Company. 

          Section 8. Adjustments. 

          (a) If the Company shall, at any time or from time to time while this Warrant is outstanding, pay a dividend or make a distribution on its Units in Units, subdivide its outstanding Units into a greater number of Units or combine its outstanding Units into a smaller number of Units or issue by reclassification of its outstanding Units any units of its membership interest (including any such reclassification in connection with a consolidation, reorganization, contribution or merger in which the Company is the continuing entity), then (i) the Warrant Price in effect immediately prior to the date on which such change shall become effective shall be adjusted by multiplying such Warrant Price by a fraction, the numerator of which shall be the number of Units outstanding immediately prior to such change and the denominator of which shall be the number of Units outstanding immediately after giving effect to such change and (ii) the number of Warrant Units purchasable upon exercise of this Warrant shall be adjusted by multiplying the number of Warrant Units purchasable upon exercise of this Warrant immediately prior to the date on which such change shall become effective by a fraction, the numerator of which is shall be the Warrant Price in effect immediately prior to the date on which such change shall become effective and the denominator of which shall be the Warrant Price in effect immediately after giving effect to such change, calculated in accordance with clause (i) above. Such adjustments shall be made successively whenever any event listed above shall occur. 

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          (b) If any capital reorganization, reclassification of the membership interests of the Company, consolidation or merger of the Company with another entity in which the Company is not the survivor, or sale, transfer or other disposition of all or substantially all of the Company's assets to another entity shall be effected, then, as a condition of such reorganization, reclassification, consolidation, merger, sale, transfer or other disposition, lawful and adequate provision shall be made whereby the Warrantholder shall thereafter have the right to purchase and receive upon the basis and upon the terms and conditions herein specified and in lieu of the Warrant Units immediately theretofore issuable upon exercise of the Warrant, such units of membership, securities or assets as would have been issuable or payable with respect to or in exchange for a number of Warrant Units equal to the number of Warrant Units immediately theretofore issuable upon exercise of the Warrant, had such reorganization, reclassification, consolidation, merger, sale, transfer or other disposition not taken place, and in any such case appropriate provision shall be made with respect to the rights and interests of each Warrantholder to the end that the provisions hereof (including, without limitation, provision for adjustment of the Warrant Price) shall thereafter be applicable, as nearly equivalent as may be practicable in relation to any units of membership, securities or assets thereafter deliverable upon the exercise hereof. The Company shall not effect any such consolidation, merger, sale, transfer or other disposition unless prior to or simultaneously with the consummation thereof the successor entity (if other than the Company) resulting from such consolidation or merger, or the entity purchasing or otherwise acquiring such assets or other appropriate entity shall assume the obligation to deliver to the Warrantholder, at the last address of the Warrantholder appearing on the books of the Company, such units of membership, securities or assets as, in accordance with the foregoing provisions, the Warrantholder may be entitled to purchase, and the other obligations under this Warrant. The provisions of this paragraph (b) shall similarly apply to successive reorganizations, reclassifications, consolidations, mergers, sales, transfers or other dispositions. 

          (c) In case the Company shall fix a payment date for the making of a distribution to all holders of Units (including any such distribution made in connection with a consolidation, reorganization, contribution or merger in which the Company is the continuing entity) of evidences of indebtedness or assets (other than cash dividends or cash distributions payable out of consolidated earnings or earned surplus or dividends or distributions referred to in Section 8(a)), or subscription rights or warrants, the Warrant Price to be in effect after such payment date shall be determined by multiplying the Warrant Price in effect immediately prior to such payment date by a fraction, the numerator of which shall be the total number of Units outstanding multiplied by the Market Price per share of Units immediately prior to such payment date, less the fair market value (as determined by the Company's Managing Members in good faith) of said assets or evidences of indebtedness so distributed, or of such subscription rights or warrants, and the denominator of which shall be the total number of Units outstanding multiplied by such Market Price per share of Units immediately prior to such payment date. 

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          (d) An adjustment to the Warrant Price shall become effective immediately after the payment date in the case of each dividend or distribution and immediately after the effective date of each other event which requires an adjustment. 

          (e) In the event that, as a result of an adjustment made pursuant to this Section 8, the Warrantholder shall become entitled to receive any interests of the Company other than Units, the number of such other interests so receivable upon exercise of this Warrant shall be subject thereafter to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the Warrant Units contained in this Warrant. 

          (f) To the extent permitted by applicable law and the listing requirements of any stock market or exchange on which the Units are then listed, the Company from time to time may decrease the Warrant Price by any amount for any period of time if the period is at least twenty (20) days, the decrease is irrevocable during the period and the Managing Members shall have made a determination that such decrease would be in the best interests of the Company, which determination shall be conclusive provided however, that the Warrant Price may not be decreased below the Market Price on the date hereof. Whenever the Warrant Price is decreased pursuant to the preceding sentence, the Company shall provide written notice thereof to the Warrantholder at least five (5) days prior to the date the decreased Warrant Price takes effect, and such notice shall state the decreased Warrant Price and the period during which it will be in effect. 

          (g) If at any time, or from time to time, the Company shall determine to register any of its securities, other than: (i) a registration relating solely to employee benefit plans; or (ii) a registration relating solely to a transaction under Rule 145 under the Securities Act of 1933, the Company will: (i) give to Warrantholder written notification thereof, including a statement as to whether the offering will involve an underwriting; and (ii) include in such registration (and any related qualification under blue sky laws or other compliance), and in any underwriting involved therein, any Units issued upon exercise of all of part of this Warrant (referred to in this Section 8(g) as "Registrable Securities") specified in a written request or requests, made by Warrantholder within twenty (20) days after receipt of such written notice from the Company. However, the Company shall have the right to terminate or withdraw a registration initiated under this Section prior to the effectiveness of such registration whether or not Warrantholder has elected to include Registrable Securities in such registration. Notwithstanding the foregoing, a security shall cease to be a Registrable Security for purposes this Section 8(g) if and when such securities may be transferred free of restrictions pursuant to Rule 144 of the Securities Act without regard to any volume limitation requirements under Rule 144 of the Securities Act. 

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          Section 9. Fractional Interest. The Company shall not be required to issue fractions of Warrant Units upon the exercise of this Warrant. If any fractional share of Units would, except for the provisions of the first sentence of this Section 9, be deliverable upon such exercise, the Company, in lieu of delivering such fractional share, shall pay to the exercising Warrantholder an amount in cash equal to the Market Price (determined in accordance with Section 3(b)) of such fractional share of Units on the date of exercise. 

          Section 10. Benefits. Nothing in this Warrant shall be construed to give any person, firm or corporation (other than the Company and the Warrantholder) any legal or equitable right, remedy or claim, it being agreed that this Warrant shall be for the sole and exclusive benefit of the Company and the Warrantholder. 

          Section 11. Notices to Warrantholder. Upon the happening of any event requiring an adjustment of the Warrant Price, the Company shall promptly give written notice thereof to the Warrantholder at the address appearing in the records of the Company, stating the adjusted Warrant Price and the adjusted number of Warrant Units resulting from such event and setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. Failure to give such notice to the Warrantholder or any defect therein shall not affect the legality or validity of the subject adjustment. 

          Section 12. Identity of Transfer Agent. The Transfer Agent for the Units is Colonial Stock Transfer. Upon the appointment of any subsequent transfer agent for the Units or other units of the Company's membership interest issuable upon the exercise of the rights of purchase represented by the Warrant, the Company will mail to the Warrantholder a statement setting forth the name and address of such transfer agent. 

          Section 13. Notices. Unless otherwise provided, any notice required or permitted under this Warrant shall be given in writing and shall be deemed effectively given and received as hereinafter described (i) if given by personal delivery, then such notice shall be deemed received upon such delivery, (ii) if given by telex or facsimile, then such notice shall be deemed received upon receipt of confirmation of complete transmittal, (iii) if given by certified mail return receipt requested, then such notice shall be deemed received upon the day such return receipt is signed, and (iv) if given by an internationally recognized overnight air courier, then such notice shall be deemed given one business day after delivery to such carrier. All notices shall be addressed as follows: if to the Warrantholder, at its address as set forth in the Company's books and records and, if to the Company, at the address as follows, or at such other address as the Warrantholder or the Company may designate by ten days' advance written notice to the other: 

	
 

	
 

	
If to the Company:

	
 

	
 

	
 

	
Summer Energy, LLC

	
 

	
800 Bering Drive, Suite 260

	
 

	
Houston, Texas 77057

	
 

	
Attention: Rod Danielson, Managing Member

	
 

	
Facsimile: 866-777-9189 

	
 

	
 

	 	 
	
With a copy (which does not constitute notice) to:

	 	 
	 	
Kirton | McConkie

	 	
50 E. South Temple

	 	
Salt Lake City, UT 84111

	 	 
Attention: Alexander N. Pearson, Esq.

	 	 
Facsimile: (801) 212-2006

	 	 	 	 	 

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          Section 14. Reserved. 

          Section 15. Successors. All the covenants and provisions hereof by or for the benefit of the Warrantholder shall bind and inure to the benefit of its respective successors and assigns hereunder. 

          Section 16. Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Warrant shall be governed by, and construed in accordance with, the internal laws of the State of Texas, without reference to the choice of law provisions thereof. The Company and, by accepting this Warrant, the Warrantholder, each irrevocably submits to the exclusive jurisdiction of the courts of the State of Texas located in Houston, Texas and the United States District Court for the Southern District of Texas for the purpose of any suit, action, proceeding or judgment relating to or arising out of this Warrant and the transactions contemplated hereby. Service of process in connection with any such suit, action or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified for the giving of notices under this Warrant. The Company and, by accepting this Warrant, the Warrantholder, each irrevocably consents to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court. The Company and, by accepting this Warrant, the Warrantholder, each irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. EACH OF THE COMPANY AND, BY ITS ACCEPTANCE HEREOF, THE WARRANTHOLDER HEREBY WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS WARRANT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER. 

          Section 17. Dispute Resolution. In the case of a dispute as to the determination of the Market Price, the Company shall submit the disputed determinations via facsimile to the Warrantholder. If the Warrantholder and the Company are unable to agree upon such determination of the Market Price within three (3) business days of such disputed determination being submitted to the Warrantholder, then the Company shall, within two (2) business days, submit via facsimile the disputed determination of the Market Price to an independent, reputable investment bank selected by the Company and approved by the Warrantholder. The Company shall cause at its expense the investment bank to perform the determinations and notify the Company and the Warrantholder of the results no later than ten (10) business days from the time it receives the disputed determinations or calculations. Such investment bank's determination shall be binding upon all parties absent demonstrable error. 

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          Section 18. No Rights as Stockholder. Prior to the exercise of this Warrant, the Warrantholder shall not have or exercise any rights as a stockholder of the Company by virtue of its ownership of this Warrant. 

          Section 19. Amendment; Waiver. Any term of this Warrant may be amended or waived (including the adjustment provisions included in Section 8 of this Warrant) upon the written agreement of the Company and the Warrantholder; provided, that the number of Warrant Units subject to this Warrant, the Warrant Price and the Expiration Date may not be amended, except as otherwise set forth herein, and the right to exercise this Warrant may not be altered or waived, without the written consent of the Warrantholder. 

          Section 20. Remedies; Other Obligations; Breaches and Injunctive Relief. The remedies provided in this Warrant shall be cumulative and in addition to all other remedies available under this Warrant, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the right of the Warrantholder right to pursue actual damages for any failure by the Company to comply with the terms of this Warrant. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Warrantholder and that the remedy at law for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, the Warrantholder shall be entitled, in addition to all other available remedies, an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other security being required. 

          Section 21. Section Headings. The section headings in this Warrant are for the convenience of the Company and the Warrantholder and in no way alter, modify, amend, limit or restrict the provisions hereof. 

[Signature Page Follows]

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          IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed, as of the 17th day of January, 2012. 

	
 

	
 

	
 

	
SUMMER ENERGY, LLC

	
 

	
 

	
 

	
By:

	
/s/ Rod Danielson

	
 

	
Name: Rod Danielson

	
 

	
Title: Managing Member

Signature Page to

Warrant to Purchase 400,000 Units of Membership Interest

 

  

APPENDIX A

SUMMER ENERGY, LLC

WARRANT EXERCISE FORM

To Summer Energy, LLC: 

          The undersigned hereby irrevocably elects to exercise the right of purchase represented by the within Warrant ("Warrant") for, and to purchase thereunder by the payment of the Warrant Price and surrender of the Warrant, _______________ Units ("Warrant Units") provided for therein, and requests that certificates for the Warrant Units be issued as follows: 

	
 

	
Name 

	
 

	
 

	
Address 

	
 

	
Federal Tax ID or Social Security No.

          and delivered by certified mail to the above address, or electronically (provide DWAC Instructions):

          _____________________________________

          _____________________________________

          _____________________________________

          or other (specify):

          _____________________________________

          _____________________________________

          _____________________________________

and, if the number of Warrant Units shall not be all the Warrant Units purchasable upon exercise of the Warrant, that a new Warrant for the balance of the Warrant Units purchasable upon exercise of this Warrant be registered in the name of the undersigned Warrantholder or the undersigned's Assignee as below indicated and delivered to the address stated below. 

[signatures on following page]

Appendix A

Warrant Exercise Form

 

  

Dated: ___________________________, _____

	
 

	
 

	
 

	
Signature

	
 

	
Signature of Spouse/Partner (if applicable)

	
 

	
 

	
 

	
Individual or Entity Name (and Title, if applicable)

	
 

	
Name (please print)

	
 

	
 

	
 

	
 

	
 

	
 

	
Address

	
 

	
Address

	
 

	
 

	
 

	
Federal Identification or Social Security No.

	
 

	
Federal Identification or Social Security No.

	
 

	
 

	
 

	
 

	
 

	
Assignee:

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Note: The signature must correspond with the name of the Warrantholder as written on the first page of the Warrant in every particular, without alteration or enlargement or any change whatever, unless the Warrant has been assigned.

	
 

	
 

Appendix A

Warrant Exercise Form

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