Document:

Exhibit 10.1

        
        AMENDMENT TO LOAN AND SECURITY AGREEMENT

        

        
        THIS AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”)
        is made and entered into on December 11, 2007 by and among BANK OF AMERICA, N.A., a
        national banking association, (“BA”), in its capacity as collateral and
        administrative agent for the Lenders under the Loan Agreement (as hereinafter defined) (BA,
        in such capacity, the “Agent”), and BA as Lender under the Loan
        Agreement (BA, together with the various financial institutions listed on the signature
        pages hereof, in such capacity, the “Lenders”), and INTEGRATED
        ELECTRICAL SERVICES, INC., a Delaware corporation (“Parent”), and
        each of the Subsidiaries of Parent listed on Annex I attached hereto (Parent and such
        Subsidiaries of Parent being herein referred to collectively as the
        “Borrowers”), and the Subsidiaries of Parent listed on Annex II attached
        hereto (such Subsidiaries being referred to herein as the “Guarantors”,
        and Borrowers and Guarantors being referred to herein as the “Credit
        Parties”).

        
        RECITALS

        

        

        	
                	
                    
                    A.     

                	
                    
                    Agent, Lenders and Credit Parties have entered
                    into that certain Loan and Security Agreement, dated as of May 12, 2006 (the
                    Loan and Security Agreement, as amended from time to time, being referred to
                    herein as the “Loan Agreement”).

                

        

        	
                	
                    
                    B.     

                	
                    
                    Credit Parties, Agent and Lenders desire to amend the Loan Agreement as
                    hereinafter set forth, subject to the terms and conditions hereinafter set
                    forth.

                

        

        

        

        
        NOW, THEREFORE, in consideration of the premises herein contained and other good and
        valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
        parties, intending to be legally bound, agree as follows:

        
        AGREEMENT

        

        

        	
                	
                    
                    ARTICLE I     

                	
                    

                    
                    Definitions

                

        

        

        

        
        1.01     

        
        

        
        Capitalized terms used in this Amendment are defined in the Loan Agreement, as amended
        hereby, unless otherwise stated.

        

        

        	
                	
                    
                    ARTICLE II     

                	
                    

                    
                    Amendments

                

        

        

        

        
        Effective as of the respective date hereinafter specified, the Loan Agreement is hereby
        amended as follows:

        
        2.01     

        
        

        
        Amendment and Restatement of Section 9.2.3(x). Effective as of the date hereof,
        Section 9.2.3(x) of the Loan Agreement is amended and restated in its entirety to
        read as follows:

        

        
        “(x)     Subordinated Debt in the amount existing on the
        date hereof and the Tontine Subordinated Debt;”

        
        2.02     

        
        

        
        Amendment and Restatement of Section 9.2.7 of the Loan Agreement. Effective as of
        the date hereof, Section 9.2.7 of the Loan Agreement is amended and restated in its
        entirety to read as follows:

        

        
        “">9.2.7     Distributions. Declare or make any
        Distributions, except for (i) Upstream Payments, (ii) repurchases of common stock of Parent
        from employees solely to satisfy their tax obligations arising from their acquisition of
        such common stock in an aggregate amount not to exceed $1,500,000 in any fiscal year of
        Credit Parties; provided, that no such repurchases of common stock of Parent shall
        be permitted unless Borrower has Availability of at least $10,000,000 at the time of such
        repurchase after giving effect to such repurchase and (iii) other repurchases of common
        stock of Parent; provided, that (a) Borrowers shall have entered into the Tontine
        Subordinated Debt Documentation, incurred the Tontine Subordinated Debt and prepaid the
        Tranche B Loan with the proceeds thereof and cash on hand prior to any such repurchase, (b)
        the aggregate amount paid in connection with all such repurchases during any period of two
        fiscal years of Credit Parties shall not exceed $27,500,000, (c) there shall not be any
        Revolver Loans outstanding at the time of any such repurchase, (d) Borrower shall have
        unrestricted cash on hand of at least $40,000,000 after giving effect to any such
        repurchase, (e) no such repurchase shall be of common stock of the Tontine Lenders or any
        of their Affiliates or of common stock of any officer, director, consultant, manager, agent
        or employee of any Credit Party or any Affiliate of any Credit Party but only if such
        repurchase is pursuant to a privately negotiated transaction between such Person and Parent
        (as distinguished from an open market repurchase by Parent, for example).”

        
        2.03     

        
        

        
        Amendment and Restatement of Section 9.3.8 of the Loan Agreement. Effective
        as of October 30, 2007, Section 9.3.8 of the Loan Agreement is amended and
        restated to read in its entirety as follows:

        

        
        “Leverage Ratio – Maintain a Leverage Ratio, on a Consolidated basis,
        tested monthly on the last day of each calendar month on a trailing twelve calendar month
        basis, beginning October 31, 2007, of not more than the ratio set forth below opposite
        the relevant date set forth below:

        

        	
                    
                    Period Ending

                	
                    
                    Leverage Ratio

                
	
                    
                    October 31, 2007

                	
                    
                    4.10 to 1.00

                
	
                    
                    November 30, 2007 and last day of each month thereafter”

                	
                    
                    4.00 to 1.00

                

        

        

        
        2.04     

        
        

        
        Amendment to Annex A. Effective as of September 29, 2007, Annex A to
        the Loan Agreement is amended as follows:

        

        
        (i)     A new definition, “September 2007 Software Capital
        Expenditures” is added to Annex A to read in its entirety as follows:

        
        “September 2007 Software Capital Expenditures – the actual
        capital expenditures incurred by Borrower (but in no event more than $2,300,000) in
        September of 2007 for software transactions involving SAP and ADP.”

        
        (ii)     The definition of “Fixed Charges” is amended
        and restated to read in its entirety as follows:

        
        “Fixed Charges – with respect to any period of Borrower on a
        consolidated basis, without duplication, cash interest expense, Capital Expenditures
        (excluding (i) Capital Expenditures funded with Debt other than Revolving Loans, but
        including, without duplication, principal payments with respect to such Debt, and (ii)
        September 2007 Software Capital Expenditures), principal payments of Debt (other than
        Revolving Loans and mandatory prepayments from asset sales), and Federal, state, local and
        foreign income taxes (including accrued taxes).”

        
        2.05     

        
        

        
        Amendment to Annex A. Effective as of the date hereof, Annex A to the Loan
        Agreement is amended to add the definitions of “Tontine Lenders”,
        “Tontine Subordinated Debt” and “Tontine Subordinated Debt
        Documentation” thereto in correct alphabetical order as follows:

        

        
        “Tontine Lenders” – collectively, Tontine Capital Partners, L.P.
        and any Affiliate of Tontine Capital Partners, L.P. that joins in and becomes party to the
        Tontine Subordinated Debt Documentation in accordance with the terms thereof.”

        
        “Tontine Subordinated Debt – unsecured Subordinated Debt of Borrowers in
        an aggregate principal amount not to exceed $25,000,000 plus any additional principal
        resulting from any in kind interest payment as permitted by the Tontine Subordinated Debt
        Documentation, payable to the Tontine Lenders pursuant to the Tontine Subordinated Debt
        Documentation.”

        

        
        “Tontine Subordinated Debt Documentation – collectively, (a) that
        certain Note Purchase Agreement, dated as of December ___, 2007, among the Tontine Lenders
        and Borrowers and (b) each of those certain Senior Subordinated Notes, dated as of December
        ___, 2007, in the aggregate original principal amount of $25,000,000 payable by Borrowers
        to the Tontine Lenders, each in form and substance satisfactory to Agent in its sole
        discretion.

        

        	
                	
                    
                    ARTICLE III     

                	
                    

                    
                    Limited Waiver

                

        

        

        

        
        3.01     

        
        

        
        Limited Waiver. Subject to the terms and conditions set forth herein and in
        reliance upon the representations and warranties of Credit Parties set forth herein, Agent
        and Lenders hereby consent to and waive any Event of Default that would otherwise exist or
        arise under the Loan Agreement solely as a result of Borrowers’ failure to comply
        with the Section 9.2.24 of the Loan Agreement upon any prepayment in full (but not
        in part) of the Tranche B Loan (the “Tranche B Loan Prepayment”) by
        Borrowers using the proceeds of unrestricted cash on hand; provided, that (i) such
        prepayment shall occur on or before December 31, 2007, (ii) Borrowers shall use all of the
        proceeds of the Tontine Subordinated Debt in connection with such prepayment, (iii) there
        shall not be any Revolver Loans outstanding at the time of such prepayment and (iv)
        Borrowers shall have unrestricted cash on hand of at least $40,000,000 after giving effect
        to such prepayment. Upon the Tranche B Loan Prepayment, all references to the
        “Tranche B Agent”, “Tranche B Lenders”, Tranche B Agreement”,
        Tranche B Loan”, “Tranche B Documentation” and “Intercreditor
        Agreement” in the Loan Agreement shall be deleted in their entirety.

        

        

        	
                	
                    
                    3.02     

                	
                    
                    No Further Waiver. Except as specifically provided in this Amendment,
                    nothing in this Amendment shall directly or indirectly whatsoever either:
                    (i) be construed as a waiver of any covenant or provision of the Loan
                    Agreement, any other Loan Document or any other contract or instrument or
                    (ii) impair, prejudice or otherwise adversely affect any right of Agent or
                    Lender at any time to exercise any right, privilege or remedy in connection
                    with the Loan Agreement, any other Loan Document or any other contract or
                    instrument, or (iii) constitute any course of dealing or other basis for
                    altering any obligation of Credit Parties or any right, privilege or remedy of
                    Agent or Lenders under the Loan Agreement, any other Loan Document or any other
                    contract or instrument or constitute any consent by Agent or Lenders to any
                    prior, existing or future violations of the Loan Agreement or any other Loan
                    Document. Credit Parties hereby agree and acknowledge that hereafter Credit
                    Parties are expected to strictly comply with their duties, obligations and
                    agreements under the Loan Agreement and the other Loan Documents.

                

        

        	
                	
                    
                    ARTICLE IV     

                	
                    

                    
                    Conditions Precedent

                

        

        

        

        
        4.01     

        
        

        
        Conditions to Effectiveness. The effectiveness of this Amendment (including the
        agreements and waiver contained herein) is subject to the satisfaction of the following
        conditions precedent in a manner satisfactory to Agent, unless specifically waived in
        writing by Agent:

        

        
        (a)     

        
        

        
        Agent shall have received this Amendment, duly executed by each of the Credit
        Parties.

        

        

        	
                	
                    
                    (b)     

                	
                    
                    The representations and warranties contained herein and in the Loan
                    Agreement and the other Loan Documents, as each is amended hereby, shall be
                    true and correct in all material respects as of the date hereof, as if made on
                    the date hereof, except for those representations and warranties specifically
                    made as of an earlier date, which shall be true and correct in all material
                    respects as of such earlier date.

                

        

        	
                	
                    
                    (c)     

                	
                    
                    After giving effect to the provisions of this Amendment, no Default or Event
                    of Default shall have occurred and be continuing, unless such Default or Event
                    of Default has been otherwise specifically waived in writing by Agent.

                

        

        	
                	
                    
                    (d)     

                	
                    
                    All organizational proceedings taken in connection with the transactions
                    contemplated by this Amendment and all documents, instruments and other legal
                    matters incident thereto shall be reasonably satisfactory to Agent and its
                    legal counsel.

                

        

        	
                	
                    
                    (e)     

                	
                    
                    Agent shall have received an amendment fee from Borrowers in the amount of
                    $500,000, to be shared pro rata among the Lenders.

                

        

        	
                	
                    
                    ARTICLE V     

                	
                    

                    
                    Ratifications, Representations and Warranties

                

        

        

        

        
        5.01     

        
        

        
        Ratifications. The terms and provisions set forth in this Amendment shall modify
        and supersede all inconsistent terms and provisions set forth in the Loan Agreement and the
        other Loan Documents, and, except as expressly modified and superseded by this Amendment,
        the terms and provisions of the Loan Agreement and the other Loan Documents are ratified
        and confirmed and shall continue in full force and effect. Each Credit Party and Lenders
        and Agent agree that the Loan Agreement and the other Loan Documents, as amended hereby,
        shall continue to be legal, valid, binding and enforceable in accordance with their
        respective terms.

        

        

        	
                	
                    
                    5.02     

                	
                    
                    Representations and Warranties. Each Credit Party hereby represents
                    and warrants to Lenders and Agent that (a) the execution, delivery and
                    performance of this Amendment and any and all other Loan Documents executed
                    and/or delivered in connection herewith have been authorized by all requisite
                    organizational action on the part of such Credit Party and will not violate the
                    organizational or governing documents of such Credit Party; (b) the
                    representations and warranties contained in the Loan Agreement, as amended
                    hereby, and any other Loan Document are true and correct in all material
                    respects on and as of the date hereof and on and as of the date of execution
                    hereof as though made on and as of each such date, except for those
                    representations and warranties specifically made as of an earlier date, which
                    shall be true and correct in all material respects as of such earlier date;
                    (c) no Default or Event of Default under the Loan Agreement, as amended
                    hereby, has occurred and is continuing, unless such Default or Event of Default
                    has been specifically waived in writing by Agent; (d) each Credit Party is
                    in material compliance with all covenants and agreements contained in the Loan
                    Agreement and the other Loan Documents, as amended hereby; and no Credit Party
                    has amended its organizational or governing documents since the date of
                    execution of the Loan Agreement.

                

        

        	
                	
                    
                    ARTICLE VI     

                	
                    

                    
                    Miscellaneous Provisions

                

        

        

        

        
        6.01     

        
        

        
        Survival of Representations and Warranties. All representations and warranties
        made in the Loan Agreement or any other Loan Document, including, without limitation, any
        document furnished in connection with this Amendment, shall survive the execution and
        delivery of this Amendment and the other Loan Documents, and no investigation by Lender or
        Agent or any closing shall affect the representations and warranties or the right of Lender
        or Agent to rely upon them.

        

        

        	
                	
                    
                    6.02     

                	
                    
                    Reference to Loan Agreement. Each of the Loan Agreement and the other
                    Loan Documents, and any and all other Loan Documents, documents or instruments
                    now or hereafter executed and delivered pursuant to the terms hereof or
                    pursuant to the terms of the Loan Agreement, as amended hereby, are hereby
                    amended so that any reference in the Loan Agreement and such other Loan
                    Documents to the Loan Agreement shall mean a reference to the Loan Agreement,
                    as amended hereby, and any reference in the Loan Agreement and such other Loan
                    Documents to any other Loan Document amended by the provisions of this
                    Amendment shall mean a reference to such other Loan Documents, as amended
                    hereby.

                

        

        	
                	
                    
                    6.03     

                	
                    
                    Expenses of Lender. As provided in the Loan Agreement, each Credit
                    Party agrees to pay on demand all costs and out-of-pocket expenses incurred by
                    Agent in connection with the preparation, negotiation, and execution of this
                    Amendment and the other Loan Documents executed pursuant hereto and any and all
                    amendments, modifications, and supplements thereto, including, without
                    limitation, the costs and fees of Agent’s legal counsel, and all costs
                    and out-of-pocket expenses incurred by Agent in connection with the enforcement
                    or preservation of any rights under the Loan Agreement, as amended hereby, or
                    any other Loan Documents, including, without, limitation, the costs and fees of
                    Agent’s legal counsel and consultants retained by Agent or retained by
                    Agent’s legal counsel.

                

        

        	
                	
                    
                    6.04     

                	
                    
                    Severability. Any provision of this Amendment held by a court of
                    competent jurisdiction to be invalid or unenforceable shall not impair or
                    invalidate the remainder of this Amendment and the effect thereof shall be
                    confined to the provision so held to be invalid or unenforceable.

                

        

        	
                	
                    
                    6.05     

                	
                    
                    Successors and Assigns. This Amendment is binding upon and shall
                    inure to the benefit of Lenders and Agent and each Credit Party and their
                    respective successors and assigns, except that no Credit Party may assign or
                    transfer any of its rights or obligations hereunder without the prior written
                    consent of Lender and Agent.

                

        

        	
                	
                    
                    6.06     

                	
                    
                    Counterparts. This Amendment may be executed in one or more
                    counterparts, each of which when so executed shall be deemed to be an original,
                    but all of which when taken together shall constitute one and the same
                    instrument.

                

        

        	
                	
                    
                    6.07     

                	
                    
                    Effect of Waiver. No consent or waiver, express or implied, by
                    Lenders or Agent to or for any breach of or deviation from any covenant or
                    condition by any Credit Party shall be deemed a consent to or waiver of any
                    other breach of the same or any other covenant, condition or duty.

                

        

        	
                	
                    
                    6.08     

                	
                    
                    Headings. The headings, captions, and arrangements used in this
                    Amendment are for convenience only and shall not affect the interpretation of
                    this Amendment.

                

        

        	
                	
                    
                    6.09     

                	
                    
                    Applicable Law. THIS AMENDMENT AND ALL OTHER LOAN DOCUMENTS EXECUTED
                    PURSUANT HERETO SHALL BE DEEMED TO HAVE BEEN MADE AND TO BE PERFORMABLE IN AND
                    SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
                    TEXAS.

                

        

        	
                	
                    
                    6.10     

                	
                    
                    Final Agreement. THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS,
                    EACH AS AMENDED HEREBY, REPRESENT THE ENTIRE EXPRESSION OF THE PARTIES WITH
                    RESPECT TO THE SUBJECT MATTER HEREOF ON THE DATE THIS AMENDMENT IS EXECUTED.
                    THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS AMENDED HEREBY, MAY NOT BE
                    CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
                    AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
                    PARTIES. NO MODIFICATION, RESCISSION, WAIVER, RELEASE OR AMENDMENT OF ANY
                    PROVISION OF THIS AMENDMENT SHALL BE MADE, EXCEPT BY A WRITTEN AGREEMENT SIGNED
                    BY EACH CREDIT PARTY AND LENDERS AND AGENT.

                

        

        	
                	
                    
                    6.11     

                	
                    
                    Release. EACH CREDIT PARTY HEREBY ACKNOWLEDGES THAT IT HAS NO
                    DEFENSE, COUNTERCLAIM, OFFSET, CROSS-COMPLAINT, CLAIM OR DEMAND OF ANY KIND OR
                    NATURE WHATSOEVER THAT CAN BE ASSERTED TO REDUCE OR ELIMINATE ALL OR ANY PART
                    OF ITS LIABILITY TO REPAY THE “OBLIGATIONS” OR TO SEEK AFFIRMATIVE
                    RELIEF OR DAMAGES OF ANY KIND OR NATURE FROM LENDER OR AGENT. EACH CREDIT PARTY
                    HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER DISCHARGES LENDERS AND
                    AGENT AND ITS RESPECTIVE PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND
                    ASSIGNS, FROM ALL POSSIBLE CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES,
                    COSTS, EXPENSES, AND LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR
                    UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL, AT
                    LAW OR IN EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS
                    AMENDMENT IS EXECUTED, WHICH ANY CREDIT PARTY MAY NOW OR HEREAFTER HAVE AGAINST
                    LENDERS OR AGENT OR ITS RESPECTIVE PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS
                    AND ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS ARISE OUT OF
                    CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR OTHERWISE, AND ARISING FROM
                    ANY “LOANS,” INCLUDING, WITHOUT LIMITATION, ANY CONTRACTING FOR,
                    CHARGING, TAKING, RESERVING, COLLECTING OR RECEIVING INTEREST IN EXCESS OF THE
                    HIGHEST LAWFUL RATE APPLICABLE, THE EXERCISE OF ANY RIGHTS AND REMEDIES UNDER
                    THE LOAN AGREEMENT OR OTHER LOAN DOCUMENTS, AND NEGOTIATION FOR AND EXECUTION
                    OF THIS AMENDMENT.

                

        

        

        

        
        Amendment
        To
             

        Loan
        and Security Agreement

        
        023528.0102/452728

        
        IN WITNESS WHEREOF, this Amendment has been executed on December 11, 2007, to be
        effective as the respective date set forth above.

        
        AGENT:

        

        BANK OF AMERICA,
        N.A., as Agent

        

        

        By:          

        Name:____________________________________
        ____

        Title:_____________________________________
        ____

        LENDERS:

        

        BANK OF AMERICA, N.A.

        

        

        By:          

        Name:____________________________________
        ____

        Title:_____________________________________
        ____

        

        
        WELLS FARGO FOOTHILL, LLC

        

        By:          

        Name:____________________________________
        ____

        Title:_____________________________________
        ____

         

        THE CIT GROUP/BUSINESS CREDIT, INC.

        

        

        By:          

        Name:____________________________________
        ____

        Title:_____________________________________
        ____

        
        Amendment
        To

        Loan and Security Agreement

        
        023528.0102/452728

        
        CREDIT
        PARTIES:

        
        INTEGRATED ELECTRICAL SERVICES, INC.

        
        By:          

        
             Curt L. Warnock

             Senior Vice President

        
        BRYANT ELECTRIC COMPANY, INC.

        IES INDUSTRIAL, INC.

        IES RESIDENTIAL, INC.

        IES COMMERCIAL, INC.

        IES HOUSTON RESOURCES, INC.

        IES PROPERTIES, INC.

        IES TANGIBLE PROPERTIES, INC.

        IES PURCHASING & MATERIALS, INC.

        IES CONSOLIDATION, LLC.

        IES SHARED SERVICES, INC.

        IES OPERATIONS GROUP, INC.

        ICS HOLDINGS, LLC.

        INTEGRATED ELECTRICAL FINANCE, INC.

        KEY ELECTRICAL SUPPLY

        MARK HENDERSON INCORPORATED

        MID-STATES ELECTRIC COMPANY, INC.

        MILLS ELECTRICAL CONTRACTORS, INC.

        MILLS MANAGEMENT, LLC.

        PAN AMERICAN ELECTRIC, INC,

        RAINES ELECTRIC CO, INC.

        RAINES MANAGEMENT, LLC.

        THOMAS POPP & COMPANY

        

        _______________________________

        Curt L. Warnock

        Vice President

        

        
        

        

        

        
        IES MANAGEMENT ROO, LP

        

        ______________________________

        Neal Electric Management, LLC.

        General Partner of IES Management ROO, LP.

        

        IES MANAGEMENT, LP

        

        _______________________________

        IES Residential Group, Inc.

        General Partner of IES Management, LP.

        

        MILLS ELECTRIC, LP

        

        ________________________________

        Mills Management, LLC.

        General Partner of Mills Electric, LP.

        

        RAINES ELECTRIC LP.

        

        _________________________________

        Raines Management, LLC.

        General Partner of Raines Electric, LP.

        

        
        

        

        

        
        MILLS ELECTRICAL HOLDINGS, LLC.

        MILLS ELECTRIC HOLDINGS II, LLC.

        RAINES HOLDINGS, LLC.

        RAINES HOLDINGS II, LLC.

        

        ____________________________________

        Curt L. Warnock

        President

        

        
         

        
        Annex I

        
        Borrowers

        

        

        	
                    
                    Bryant Electric Company, Inc.

                	
                    
                    North Carolina

                	
                 
	
                    
                    IES Commercial, Inc

                	
                    
                    Delaware

                	
                 
	
                    
                    IES Consolidation LLC

                	
                    
                    Delaware

                	
                 
	
                    
                    IES Houston Resources, Inc

                	
                    
                    Texas

                	
                 
	
                    
                    IES Industrial, Inc.

                	
                    
                    South Carolina

                	
                 
	
                    
                    IES Management LP

                	
                    
                    Texas

                	
                 
	
                    
                    IES Management ROO, LP

                	
                    
                    Texas

                	
                 
	
                    
                    IES Properties Inc.

                	
                    
                    Texas

                	
                 
	
                    
                    IES Purchasing & Materials, Inc.

                	
                    
                    Delaware

                	
                 
	
                    
                    IES Residential, Inc.

                	
                    
                    Texas

                	
                 
	
                    
                    IES Shared Services, Inc.

                	
                    
                    Delaware

                	
                 
	
                    
                    IES Tangible Properties, Inc.

                	
                    
                    Delaware

                	
                 
	
                    
                    Integrated Electrical Services, Inc.

                	
                    
                    Delaware

                	
                 
	
                    
                    Key Electrical Supply, Inc.

                	
                    
                    Texas

                	
                 
	
                    
                    Mark Henderson, Incorporated

                	
                    
                    Delaware

                	
                 
	
                    
                    Mid-States Electric Company, Inc.

                	
                    
                    Delaware

                	
                 
	
                    
                    Mills Electric LP

                	
                    
                    Texas

                	
                 
	
                    
                    Pan American Electric, Inc.

                	
                    
                    Tennessee

                	
                 
	
                    
                    Raines Electric LP

                	
                    
                    Texas

                	
                 
	
                    
                    Thomas Popp & Company

                	
                    
                    Ohio

                	
                 

        

        

        

        
         

        
        Annex II

        
        Guarantors

         

             

        	
                    
                    IES Properties, Inc

                	
                    
                    Delaware

                	
                 
	
                    
                    IES Reinsurance, Ltd.

                	
                    
                    Bermuda

                	
                 
	
                    
                    IES Residential Group, Inc.

                	
                    
                    Delaware

                	
                 
	
                    
                    Mills Electric Contractors, Inc.

                	
                    
                    Delaware

                	
                 
	
                    
                    Mills Electric Holdings II LLC

                	
                    
                    Delaware

                	
                 
	
                    
                    Mills Electrical Holdings LLC

                	
                    
                    Arizona

                	
                 
	
                    
                    Mills Management LLC

                	
                    
                    Arizona

                	
                 
	
                    
                    Neal Electric Management LLC

                	
                    
                    Arizona

                	
                 
	
                    
                    Pan American Electric Company, Inc.

                	
                    
                    New Mexico

                	
                 
	
                    
                    Raines Electric Co., Inc.

                	
                    
                    Delaware

                	
                 
	
                    
                    Raines Holdings II LLC

                	
                    
                    Delaware

                	
                 
	
                    
                    Raines Holdings LLC

                	
                    
                    Arizona

                	
                 
	
                    
                    Raines Management LLC

                	
                    
                    Arizona

                	
                 
	
                    
                    Integrated Electrical Finance, Inc.

                	
                    
                    Delaware

                	
                 
	
                    
                    IES Operation Group, Inc.

                	
                    
                    Delaware

                	
                 
	
                    
                    ICS Holdings, LLC

                	
                    
                    Arizonacnuv10q1007ex10_1.htm

    
      

    

    EXHIBIT
      10.1

     

    

      COLLABORATION
        AND DEVELOPMENT AGREEMENT

      

      

      This
        Collaboration and Development
        Agreement (the “Agreement”) is between China Nuvo Solar Energy, Inc., a
        corporation incorporated in the state of [Nevada] (“Nuvo”), and Pioneer
        Materials, Inc., a corporation incorporated in the state of Delaware
        (“PMI”).  Nuvo and PMI may be collectively referred to in this
        Agreement as the “Parties” and each may be individually referred to as a “Party”
when referred to generally.

      WHEREAS,
        Nuvo owns or has exclusive
        licenses or sublicenses to a patent that utilizes certain solar energy
        technology relating to the design of solar cells, which patent is identified
        in
        Schedule A hereof, along with associated proprietary information, know-how,
        patents and patent applications (the “Nuvo Technology”); and

      WHEREAS,
        PMI is the owner of certain
        facilities locate in Chengdu, Sichuan, China with a capacity for the development
        and manufacture of solar cell materials and components;

      WHEREAS,
        Nuvo would like PMI to use the
        Nuvo Technology to develop prototype solar cell products, to facilitate that
        development by creating a pilot facility by building out and modifying its
        facilities and acquiring additional equipment and

      
        
           

        

        
           

          
            

          

        

        
          2

        

      

      personnel,
        and to subsequently commercially manufacture marketable solar
        cells;

      WHEREAS,
        PMI is willing to create a
        pilot facility and to undertake the foregoing development work under the
        terms
        and conditions set forth in this Agreement;

      NOW
        THEREFORE in consideration of the
        foregoing (which is expressly incorporated herein and made part of this
        Agreement) and other good and valuable consideration, the receipt and
        sufficiency of which is hereby acknowledged, the Parties, intending to be
        legally bound, agree as follows:

      1.           Product
        Development

      1.1           Product
        Development Facility.  PMI will build, equip, operate and manage
        for the benefit of Nuvo a product development, testing and prototype
        manufacturing facility to develop, test and manufacture prototypes of solar
        energy products and equipment, utilizing the Nuvo Technology (the
“Products”).  PMI will hire and retain those competent and
        sufficiently talented technical, engineering, development, testing and
        manufacturing employees and support staff necessary to complete the work
        of
        developing the Products according to a statement of work agreed to by PMI
        and
        Nuvo or its designated representatives after consultation by the
        Parties.  PMI and the employees hired by PMI for this project shall
        work diligently

      
        
           

        

        
           

          
            

          

        

        
          3

        

      

      and
        efficiently to develop the Products with an objective to meet the Product
        Specifications referred to in Section 1.2.

      

      1.2           Product
        Specifications; Final Product.  The Parties understand and agree
        that the objective of the Parties under this Agreement is to develop a prototype
        Product that meets the product specifications listed in Schedule B, as they
        may
        be modified, adjusted or supplemented by the Parties (the “Product
        Specifications” and a Product that meets the Product Specifications, the “Final
        Product”).  The parties recognize and agree that the Product
        Specifications are a goal only and that not all initial or intervening test
        samples or prototypes of the Products will meet the Product Specifications
        or be
        marketable.  THEREFORE, PMI MAKES NO WARRANTY REGARDING ANY
        PRODUCT, WHETHER EXPLICIT OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY
        IMPLIED
        WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
        PURPOSE.  In addition, failure to meet the Product
        Specifications alone shall not be a breach by PMI of its obligations under
        this
        Agreement, but may result in the failure by PMI to meet a milestone set forth
        in
        Schedule B and to earn the corresponding equity compensation.  The
        Parties shall review the Statement of Work and the Product Specifications
        every
        three month following the execution of this Agreement to determine if any
        modifications or changes are required in light of the

      
        
           

        

        
           

          
            

          

        

        
          4

        

      

      progress
        or lack of progress towards the development of the Product and shall make
        those
        changes needed to develop and produce a commercially viable Final
        Product.

      1.3           Employees.  The
        employees hired and retained by PMI for this project shall be employees of
        PMI
        and shall not be employees of Nuvo.  PMI shall pay and provide for all
        wages, compensation, benefits, and any and all taxes, employee withholding
        and
        other remuneration necessary or proper with respect to the employees and
        shall
        comply with all applicable laws, rules, regulations, practices and procedures
        in
        the jurisdiction in which the facility is located.   PMI shall be
        fully and exclusively responsible for all worker supervision, safety and
        safety
        equipment, worker protection and security, and all worker compensation for
        injuries or maladies allegedly arising out of or related to the work or the
        employment of any and all employees associated with or exposed to the project
        which is the subject of this Agreement.  PMI shall be responsible for
        providing the working conditions, management, labor relations, and supervision
        so as to properly provide for the welfare and safety of its employees in
        compliance with applicable laws, rules, regulations, practices and standards
        of
        the jurisdictions in which the facility is located.

      
        
           

        

        
           

          
            

          

        

        
          5

        

      

      1.4           Environmental
        Standards.  PMI shall comply with all applicable environmental
        laws, rules, regulations and procedures of the jurisdiction[s] in which the
        Products are to be developed, tested and manufactured.  PMI shall have
        the sole and exclusive responsibility, cost and expense of properly disposing
        of
        any and all hazardous materials used, generated, consumed or produced in
        connection with the work undertaken pursuant to this Agreement.

      1.5           Product
        Testing.  Nuvo shall be responsible for submitting the Products
        for testing by any appropriate testing agency or institution (such as for
        example Underwriters Laboratory or TUV) in order to obtain appropriate
        certification of the Product[s] for sale in markets where that Product is
        to be
        offered.  PMI shall cooperate reasonably to assist Nuvo in
        successfully completing any testing or review, by providing any necessary
        documentation or information in its possession or subject to its
        control.

      1.6           Ownership
        of Equipment, Tools, Dies and Patterns.  PMI and Nuvo will consult
        and agree upon any new or specialized equipment, tools, dies, molds, patterns,
        jigs, guides, assemblies and testing equipment that may be required in order
        to
        develop, test and manufacture the Product (the “Nuvo Equipment”), as well as any
        necessary materials and supplies (the “Nuvo Materials”).  Upon
        approval by Nuvo, PMI shall source

      
        
           

        

        
           

          
            

          

        

        
          6

        

      

      and
        obtain all necessary Nuvo Equipment and Nuvo Material for the work under
        this
        Agreement.  Nuvo shall reimburse Nuvo for all Nuvo Equipment and Nuvo
        Material at PMI’s cost, without any additional markup or sourcing fee, no later
        than fifteen (15) days after the date of PMI’s invoice for
        reimbursement.  Notwithstanding the foregoing, PMI may delay the
        acquisition of Nuvo Equipment and/or Nuvo Materials until it has received
        prepayment therefore from Nuvo if in PMI’s reasonable judgment it has
        insufficient funds to acquire the Nuvo Equipment or Nuvo Materials and pay
        the
        supplier’s invoice according to the agreed terms with the
        supplier.  Nuvo may at Nuvo’s option pay the supplier of the Nuvo
        Equipment or Nuvo Materials directly.  All  reimbursements
        or prepayments shall be in addition to PMI’s compensation under Section 2 and
        Schedule C hereof.  PMI acknowledges and agrees that all Nuvo
        Equipment and Nuvo Materials are the property of Nuvo and hereby assigns,
        conveys, bargains and conveys title to all Nuvo Equipment and Nuvo Materials
        to
        Nuvo, free and clear of all liens, claims and interests.  PMI shall
        not grant or suffer any liens, claims or interests to attach to the Nuvo
        Equipment or the Nuvo Materials.

      1.7           Records
        and Inspection.  PMI shall maintain adequate and complete records
        of its development, testing, prototype manufacturing, quality control, safety,
        product compliance with standards and requirements and other related operations
        so as to

      
        
           

        

        
           

          
            

          

        

        
          7

        

      

      properly
        document the processes for the purposes of evaluation, intellectual property
        protection and development of processes for the manufacture of the
        Products.  Nuvo shall be entitled to inspect and obtain copies of
        these records at any time at no additional cost.  Nuvo or its
        designated representatives may (but are not required to) visit and inspect
        the
        facilities associated with this project and all records associated with this
        project during normal business hours.

      

      2.           Compensation.

      2.1           Payment.  Nuvo
        shall compensate PMI for the work to be undertaken pursuant to this Agreement
        as
        is set forth in the Payment Schedule, attached as Schedule C (the “Payment
        Schedule”).  The obligation of Nuvo to compensate PMI for work
        performed shall be expressly conditioned on PMI’s performance of the work
        pursuant to the terms of this Agreement and Nuvo shall have no obligation
        to
        compensate PMI for work during a particular period or for a particular item
        if
        PMI has breached this Agreement with respect to that work period or
        item.  Unless otherwise expressly agreed by Nuvo, payments shall be
        made in United States Dollars delivered by check to an address of PMI in
        the
        United States, which initially shall be the address set forth in section
        6.5
        below.

      
        
           

        

        
           

          
            

          

        

        
          8

        

      

      2.2           Stock
        Related Compensation.  A portion of the compensation provided by
        Nuvo to PMI shall be in form of common stock Nuvo or warrants or options
        to
        acquire the common stock of Nuvo.  Some or all of these securities may
        contain restrictions on the trading of that stock under the securities laws
        of
        the United States.  Prior to issuing the stock, warrants or options,
        Nuvo may require PMI to satisfactorily complete, execute and deliver to Nuvo
        those documents required by securities counsel for Nuvo in order to comply
        in
        the opinion of Nuvo’s counsel with the securities laws of the United States and
        any other applicable jurisdictions regarding qualifications of PMI as an
        investor in these securities, PMI’s agreement to abide by the restrictions on
        the sale of these securities and other matters relating to the compliance
        with
        securities laws.  PMI will be issued 4,000,000 shares of common stock
        in Nuvo based on satisfactory completion of the milestone accomplishments
        set
        forth in Schedule B.

      

      3.           Intellectual
        Property and Confidentiality.

      3.1           Confidential
        Information.  The term “Confidential Information” shall mean, with
        respect to each Party, all data, information and materials of that Party
        or any
        parent, subsidiary, affiliate or division thereof which is not generally
        known
        or readily available to competitors or the public

      
        
           

        

        
           

          
            

          

        

        
          9

        

      

      including,
        but not limited to the following: (a) concepts, ideas, proposals, text,
        illustrations, designs, characters, trade secrets, proposed trademarks and
        trade
        names; (b) information or data including, but not limited to, technical or
        non-technical data, software, specifications, designs,  plans,
        drawings, techniques, devices, research, development, manufacturing process
        and
        methods, know how, techniques or operating procedures; (c) computer codes
        of
        that Party or embodying the Party’s website, any customizations thereof, and any
        information pertaining to the operation or use of the Party’s website by
        clients, or any other person or entity; (d) matters of the Party’s business, or
        any parent, subsidiary, affiliate, or division thereof including, but not
        limited to, financial data or plans, business plans and strategies, product
        plans, marketing plans, techniques and materials, proprietary information
        relating to products, processes and know-how, information concerning employees,
        clients, suppliers and/or vendors, lists of actual or potential clients,
        suppliers and/or vendors, price lists, pricing policies, and any information
        about such business, clients, client lists, shareholders, partners, contracts,
        assets, liabilities, or other financial information, past, present or proposed
        business operations, or projects or business opportunities for new or developing
        business, and, any other financial or business information
        about

      
        
           

        

        
           

          
            

          

        

        
          10

        

      

      that
        Party or any of its parent, subsidiaries, affiliates or divisions thereof;
        and
        (e) any other proprietary information relating to the business of that Party,
        whether oral, graphic, written, electronic or in machine readable
        form.  “Confidential Information” shall not include information that
        is:

      
        	
                (a)  

              	
                already
                  public knowledge or becomes public knowledge through no fault or
                  negligence of the receiving Party;

              

      

      
        	
                (b)  

              	
                shown
                  by the written records of the receiving Party to have been possessed
                  or
                  known to the receiving Party prior to its receipt from the disclosing
                  Party, or to have been developed independently by the receiving
                  Party’s
                  personnel acting without access to the Confidential Information;
                  or

              

      

      
        	
                (c)  

              	
                received
                  by the receiving Party from an independent third party that has
                  no
                  obligation of confidentiality to the disclosing
                  Party.

              

      

      

      3.2           Confidentiality.  Each
        Party that receives Confidential Information of the other Party agrees at
        all
        times during the term of this Agreement and thereafter, to hold in strictest
        confidence, and not to use, except for the benefit of the Parties as intended
        under this Agreement, or to disclose to any person, firm or corporation without
        written authorization of

      
        
           

        

        
           

          
            

          

        

        
          11

        

      

      from
        the
        disclosing Party, any Confidential Information of the disclosing
        Party.

      3.3           Use
        and Protection of Confidential Information.  Each Party shall use
        the Confidential Information solely in the course of the business relationship
        between the Parties and shall not in any way use the Confidential Information
        to
        the detriment of the disclosing Party.  Each party receiving
        Confidential Information shall at its sole expense, take all reasonable measures
        to restrain its officers, directors, employees, representatives and affiliates
        from making prohibited disclosure or use of the Confidential
        Information.

      3.4           Permitted
        Disclosure.  Each Party may disclose the Confidential Information
        of the other Party only to the receiving Party's officers and employees with
        a
        bona fide need to know that Confidential Information in order to carry out
        the
        terms of this Agreement, but only to the extent necessary to evaluate or
        carry
        out the receiving Party's obligations under this Agreement and only if each
        of
        the officer and employees are advised of the confidential nature of that
        Confidential Information and the terms of this Agreement and are bound by
        a
        written agreement or by a legally enforceable code of professional
        responsibility to protect the confidentiality of the Confidential Information;
        or to the extent required by applicable state or federal laws.  In the
        event that the

      
        
           

        

        
           

          
            

          

        

        
          12

        

      

      receiving
        Party, or any attorney, agent, successor or assign thereof receives a notice,
        subpoena or order requesting or requiring that any of the Confidential
        Information be disclosed, or the receiving Party, or any attorney, agent,
        successor or assign thereof, decides to disclose any of the Confidential
        Information for any reason, the person or entity receiving the notice, subpoena
        or order, or deciding to disclose the Confidential Information, shall
        immediately notify the disclosing Party of that notice, subpoena or order,
        or
        intent to disclose the Confidential Information so that the disclosing Party
        can
        appropriately contest the disclosure of the Confidential
        Information.

      3.5           Return
        of Records and Documents.  At any time upon the request of the
        disclosing Party for any reason or upon termination of this Agreement for
        any
        reason, the receiving Party shall immediately return or destroy any Confidential
        Information of the disclosing Party in its possession to the disclosing Party,
        including any and all records, notes, and other written, printed or other
        tangible materials in its possession pertaining to the Confidential Information;
        provided that the receiving Party shall be entitled to maintain an archival
        copy
        of those materials necessary to comply with generally accepted accounting
        principles or as may otherwise be required by applicable law, regulation
        or
        order.  The returning

      
        
           

        

        
           

          
            

          

        

        
          13

        

      

      of
        materials shall not relieve either Party from compliance with other terms
        and
        conditions of this Agreement.

      3.6           Assignment
        of Nuvo Inventions.  PMI acknowledges and agrees that all of the
        Products designed, developed, researched, tested and produced in connection
        with
        this Agreement, including all test versions, prototypes (whether successful
        or
        not) are the sole property of Nuvo unless otherwise agreed by
        Nuvo.  PMI agrees that, subject to PMI’s rights under Section 3.7, it
        will promptly make full written disclosure to Nuvo and will hold in trust
        for
        the sole right and benefit of Nuvo and hereby assigns to Nuvo, or its designee,
        all PMI's right, title, and interest in and to any and all inventions, original
        works of authorship, developments, concepts, improvements, sub-licensing
        rights,
        or trade secrets, whether or not patentable or subject to registration under
        copyright or similar laws (collectively, “Inventions”), that relate to the
        manufacture of solar cells through use of the Nuvo Technology and that PMI
        may
        solely or jointly conceive or develop or reduce to practice, or cause to
        be
        conceived or developed or reduced to practice, during the period of this
        Agreement with Nuvo and that may be subject to protection by copyright as
        "works
        made for hire," as that term is defined in the United States Copyright Act
        or
        otherwise under U.S. patent law.  PMI shall require all of the
        employees and agents hired or retained by PMI who participate in, assist
        or

      
        
           

        

        
           

          
            

          

        

        
          14

        

      

      otherwise
        observe the work under this Agreement to execute documents assigning their
        rights as described in this section to Nuvo through PMI.

      3.7           Inventions
        from PMI Technology.  During the course of the project, PMI may
        apply some of its own proprietary technology as well as technology relating
        to
        the manufacture and purification of materials, the formation of compounds
        using
        or containing such materials, and the processing of such compounds into powders
        (collectively, the “PMI Technology”) to the development and manufacture of the
        Products.  In doing so, PMI may develop Inventions that relate to the
        PMI Technology.  All Inventions that (i) relate to the manufacture and
        purification of materials, compound formation or the processing of powders
        for
        solar cells, or (ii) otherwise arise solely from the application of the PMI
        Technology to the manufacture of the Products, are referred to as the “PMI
        Inventions.”   The Parties agree that the PMI Inventions are the
        exclusive property of PMI and Nuvo agrees to assign (and to cause its employees
        and agents to assign) to PMI all right, title and interest that they may
        have in
        any PMI Inventions.  In order to enable Nuvo to utilize PMI Inventions
        resulting from PMI’s performance of the project, PMI hereby agrees to grant to
        Nuvo a worldwide, perpetual,  royalty-free and non-exclusive license,
        with the limited right to sub-license as described below, to any and all
        PMI
        Inventions

      
        
           

        

        
           

          
            

          

        

        
          15

        

      

      made,
        conceived and/or reduced to practice by PMI in the process of developing
        the
        Products.  Nuvo’s use and sublicense of the PMI Inventions shall be
        limited to the manufacture of the Final Products.  Nuvo may sublicense
        its rights to the PMI Inventions only with prior written notice to PMI of
        the
        name and address of any sublicensee and only if that sublicensee agrees in
        writing to be bound by the confidentiality provisions of this
        Agreement.

      3.8           Records
        Regarding Nuvo Inventions.  PMI agrees to keep and maintain
        adequate and current written records of all Nuvo Inventions made by any of
        its
        employees or agents who participate in, assist or otherwise observe the work
        under this Agreement (solely or jointly with others) during the term of this
        Agreement with Nuvo.  The records will be in the form of notes,
        sketches, drawings, laboratory books and any other format that may be specified
        by Nuvo, or otherwise in accordance with good industry practices.  The
        records will be available to and remain the sole property of Nuvo at all
        times.

      3.9           Patents
        and Copyright Registration.  Each of the Parties agrees to assist
        (and agrees to cause its employees to assist) the other Party seeking to
        secure
        its intellectual property rights relating to the Products, or its designee
        (the
“IP Applicant”), in securing the IP Applicant's rights in and to any Inventions
        and any copyrights, patents, mask work rights or other intellectual property
        rights relating thereto in any and

      
        
           

        

        
           

          
            

          

        

        
          16

        

      

      all
        countries.  This assistance shall include the disclosure to the IP
        Applicant of all pertinent information and data with respect thereto, the
        execution of all applications, specifications, oaths, assignments and all
        other
        instruments that the IP Applicant shall determine to be necessary in order
        to
        apply for and obtain these rights and in order to assign and convey to the
        IP
        Applicant, its successors, assigns and nominees the sole and exclusive rights,
        title and interest in and to these Inventions, and any copyrights, patents,
        mask
        work rights or other intellectual property rights relating
        thereto.  Each Party agrees that its obligation to execute or cause to
        be executed, when it is in its power to do so, any instrument or papers shall
        continue after the termination of this Agreement.   If the IP
        Applicant is unable for any reason to secure the signature of the other Party
        or
        any of its employees to apply for or to pursue any application for any United
        States or foreign patents or copyright registrations covering the IP Applicant’s
        Inventions or original works of authorship assigned to the IP Applicant as
        provided herein, then the other Party does hereby irrevocably designate and
        appoint the IP Applicant and its duly authorized officers and agents as its
        agent and attorney in fact, to act for and in its behalf and stead to execute
        and file any such applications and to do all other lawfully permitted acts
        to
        further the prosecution and issuance

      
        
           

        

        
           

          
            

          

        

        
          17

        

      

      of
        letters patent or copyright registrations thereon with the same legal force
        and
        effect as if executed by that Party.

      3.10                      Personnel
        Hiring.  Each Party agrees that it will not solicit or hire
        personnel from the other Party for the purposes of development or production
        of
        the Products, whether during the term of this Agreement or for a period of
        two
        (2) years after the termination of this Agreement without the consent of
        the
        other Party.

      

      4.           Term,
        Termination and Indemnity.

      4.1           Term
        of Agreement.  This Agreement will begin on the Effective Date
        and, unless sooner terminated, shall continue for a period of one (1) year
        thereafter (the "Initial Term").  Unless either Party terminates this
        Agreement pursuant to Section 4.2, this Agreement shall automatically renew
        on
        the expiration of the Initial Term for successive six (6) month terms thereafter
        (each a "Renewal Term" and collectively the "Renewal Terms").

      4.2           Termination.  This
        Agreement may only be terminated as follows:  (a) by either Party upon
        a material breach of this Agreement by the other Party and a failure to cure
        the
        breach within thirty (30) days after receipt of written notice specifying
        the
        breach; (b) by either Party at the end of the Initial term of this Agreement
        or
        at the end of any subsequent

      
        
           

        

        
           

          
            

          

        

        
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      Renewal
        Term by written notice given thirty (30) days prior to the end of the Initial
        Tem or any Renewal Term; (c) upon the bankruptcy or insolvency of either
        Party
        at the option of the other Party; and (d) by the agreement of both
        Parties.  Except as provided in Section 1.6, Section 2, Section 3,
        this Section 4.2, Section 4.3, Sections 6.5 through 6.8 and any other provisions
        of this Agreement necessary for the full and clear interpretation of those
        provisions (including but not limited to sections 1.2 through 1.4), all
        obligations of the Parties to each other under this Agreement shall cease
        upon
        termination of this Agreement.

      4.3           Indemnity
        and Contribution.

      4.3.1.                      Except
        to the extent that a claim arises out of the negligence or willful misconduct
        of
        Nuvo, PMI shall indemnify and hold Nuvo harmless from any and all claims
        of: (a)
        any employee, agent, supplier or subcontractor utilized or retained by PMI
        in
        connection with this Agreement; (b) any alleged owner or holder of any alleged
        intellectual property allegedly infringed, misused, improperly copied or
        misappropriated by PMI or any of its employees or agents in connection with
        research, development, prototype manufacturing, testing or production of
        the
        Products, except where the source of that alleged infringement, copying or
        misappropriation is information

      
        
           

        

        
           

          
            

          

        

        
          19

        

      

      provided
        by Nuvo; (c) any alleged improper use, storage, handling, release, disposal
        or
        loss of any allegedly hazardous materials at PMI’s facility; and (d) any other
        breach of this Agreement resulting in a claim by any third party, government
        or
        agency against Nuvo, including paying all of the costs of defending any of
        these
        claims, including but not limited to attorneys and paralegal fees and expenses
        and expert witness fees expenses as they are incurred.

      4.3.2  Nuvo
        agrees to indemnify, defend and hold PMI and its directors, officers, employees,
        agents and consultants harmless against (a) any claim arising out of or relating
        to any loss or damage, including bodily injury or death, incurred by reason
        or
        resulting from a defect in Nuvo’s design of a Product, except to the extent that
        such loss or damage is caused by PMI’s negligence or willful misconduct or
        breach of this Agreement and (b) any claim from any alleged owner or holder
        of
        any alleged intellectual property allegedly infringed, misused, improperly
        copied or misappropriated by Nuvo or any of its employees or agents in
        connection with research, development, prototype manufacturing, testing or
        production of the Products, except where the source of that alleged
        infringement, copying or misappropriation is information

      
        
           

        

        
           

          
            

          

        

        
          20

        

      

      provided
        by PMI.  Such indemnification by Nuvo shall include paying
        all of the costs of defending any of these claims, including but not limited
        to
        attorneys and paralegal fees and expenses and expert witness fees expenses
        as
        they are incurred.

      

      5.           Manufacturing
        and Supply.

      5.1           Manufacturing
        and Supply Agreement.  Upon successful development of the Final
        Products, and thereafter during the term of this Agreement, the Parties shall
        negotiate in good faith on the terms and conditions of a manufacturing and
        supply agreement for the commercial production of the Products.

      5.2           Right
        of First Refusal.  Nuvo agrees that in the event that it has
        negotiated and manufacturing and supply relationship with any person or entity
        other than PMI, before entering into a binding agreement with that other
        person
        or entity, it will first afford to PMI the right to enter into a definitive
        manufacturing and supply agreement with Nuvo on terms and conditions that
        are
        substantially the same as those being proposed by the other person or
        entity.

      5.3           Sole
        Source.  PMI agrees that during the term of this Agreement and for
        two (2) years following the termination of this Agreement, it shall not
        research, develop, design, test or produce solar energy products using any
        element of the Nuvo

      
        
           

        

        
           

          
            

          

        

        
          21

        

      

      Technology
        other than those Products it researches, develops, designs, tests or produces
        for solely for Nuvo.

      5.4.                      Other
        Activities.  The Parties acknowledge and agree that PMI is engaged
        and may continue to be engaged with other persons and entities in the
        development, fabrication and supply of solar cells and the materials and
        technology relating to solar cells and that this activity may compete with
        the
        development, manufacture and sale of the Products.  Nothing in this
        Agreement shall be a limitation on PMI’s right to continue or to enter into any
        relationship with any other party for the development, fabrication or supply
        of
        solar cells and the material and technology relating to solar cells, provided
        that none of these activities make use of the Nuvo Technology or any of the
        proprietary information related to the Nuvo Technology or the Products or
        the
        development of the Products.

      

      6.           Other
        Provisions.

      6.1           Assignment.  PMI
        may not assign or subcontract its obligations under this Agreement to any
        other
        person or entity without the express written consent of Nuvo, which shall
        not be
        unreasonably withheld.  Any entity acting as a subcontractor or
        assignee of PMI must expressly consent in writing to honor all of the terms
        of
        this Agreement prior to any assignment or
        subcontract.  Notwithstanding the foregoing, without the prior written
        consent of Nuvo, PMI may assign or transfer its rights and obligations under
        this Agreement to any affiliate or subsidiary of PMI, upon written notice
        to
        Nuvo.

       

       

      
        
           

        

        
           

          
            

          

        

        
          22

        

      

       

      6.2           Severability.  The
        Parties acknowledge and agree that the restrictions set forth in this Agreement
        are reasonable in scope and duration and are necessary to protect each Party
        and
        to enable each Party to receive the anticipated benefits of this Agreement
        and
        the arrangements contemplated hereby.  The Parties to this Agreement
        agree that, if any of the terms of this Agreement is determined to be unlawfully
        restrictive by a court of competent jurisdiction, that provision shall be
        deemed
        to be amended and shall be construed by that court to have the broadest type,
        scope and duration permissible under applicable law, and if no validating
        construction is possible, shall be severable from the rest of this Agreement,
        and the validity, legality or enforceability of the remaining provisions
        of this
        Agreement shall not in any way be affected or impaired thereby.

      6.3           Entire
        Agreement.  This Agreement shall be binding upon and shall inure
        to the benefit of the Parties and their respective heirs, successors and
        assigns.  This Agreement may be executed in any number of
        counterparts, all of which will be considered one and the same
        agreement.  All of the Parties, with the assistance of their counsel,
        have participated in the drafting and negotiation of this Agreement, and
        the
        Agreement shall be construed as if it were prepared by all of the Parties
        to
        this Agreement, without regard to who originally drafted or proposed any
        section
        or term of the Agreement.  This Agreement reflects the entire
        understanding between the 

       

       

      
        
           

        

        
           

          
            

          

        

        
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      Parties
        to this Agreement, and fully supersedes and replaces any and all alleged
        or
        actual prior agreements or understandings between the Parties to this Agreement
        (including the term sheet between the Parties dated July 24, 2007 and any
        agreements relating to the subject therein).  No modification or
        amendment to this Agreement shall be valid or binding unless that modification
        or amendment is set forth in a subsequent written document executed by each
        of
        the Parties to be bound by the amendment or modification.

      6.4           Representations
        and Warranties.  Each Party to this Agreement represents and
        warrants to the other Party that: (a) it has full power and authority to
        enter
        into this Agreement and perform all of its obligations under this Agreement,
        has
        duly executed and delivered this Agreement, and this Agreement is legally
        binding on it and is enforceable in accordance with its terms; (b) the
        execution, delivery and performance of the transactions contemplated herein
        do
        not conflict with or violate, or result in a breach of or constitute a default
        under, any contract or agreement to which it is a party or by which it is
        bound;
        and (c) no consent or approval from any person, firm or entity, or any
        governmental authority or court, is required in connection with the execution
        and delivery of this Agreement or the consummation of the transactions
        contemplated by this Agreement.  Each of the Parties 

       

       

      
        
           

        

        
           

          
            

          

        

        
          24

        

      

       

      represents
        and warrants that it has not filed for or been the subject of any bankruptcy
        or
        insolvency proceeding or receivership, that it is competent and authorized
        to
        enter into and perform this Agreement, and will be bound by the terms of
        this
        Agreement.

      6.5           Notices.  All
        notices permitted, provided for, necessary or convenient in connection with
        this
        Agreement shall be effective (a) when the confirmation is electronically
        recorded after being sent by telecopier to the telecopier numbers for the
        parties set forth in Schedule D attached, or (b) the next business day after
        being sent for overnight delivery, proper charges pre-paid, by a reputable
        overnight delivery service or U.S. Express Mail to the notice address of
        the
        parties set forth in Schedule D attached, or (c) upon the seventh business
        day
        after being mailed certified or registered mail, return receipt requested,
        proper postage prepaid to the notice address of the parties set forth in
        Schedule D attached (or to any subsequent Notice Address for which the other
        parties have been given notice as provided for herein).

      6.6           Choice
        of Law and Arbitration.  This Agreement shall be governed by and
        construed in accordance with the laws of the State of Florida, United States
        of
        America.  All disputes, claims and other matters in controversy
        arising directly or indirectly out of or related to this Agreement, or the
        breach hereof, whether contractual or non-contractual, shall be determined
        by
        arbitration and shall be settled by a majority vote of three impartial
        arbitrators, one of whom shall be selected by Nuvo, one of whom shall be
        selected by PMI and the third of whom shall be selected by the first two
        arbitrators.  Persons eligible to be selected as arbitrators shall be
        limited to attorneys 

       

       

      
        
           

        

        
           

          
            

          

        

        
          25

        

      

       

      and
        judges who have been in practice at least ten (10) years specializing in
        corporate and commercial (if it is a commercial dispute) or intellectual
        property matters (if it is an intellectual property dispute), who have had
        both
        training and experience as arbitrators and who have had no prior relationship
        or
        business dealings with either Party or their respective directors and
        officers.  This Agreement has been made in the English language at the
        choice of the Parties and all communications with respect to this Agreement
        and
        the transactions contemplated under the Agreement and any arbitration or
        other
        proceedings shall be conducted in using the English language, in a location
        to
        be mutually agreed upon by the Parties in accordance with the commercial
        arbitration rules of the American Arbitration Association then in effect,
        subject to any modifications agreed to in writing by the parties.  The
        U.S. Federal Arbitration Act (the "FAA") shall apply to the construction
        and
        interpretation of this agreement to arbitrate.  The arbitrators shall
        base their award on applicable law and judicial precedent and, unless both
        parties agree otherwise, shall include in that award the findings of fact
        and
        conclusions of law upon which the award is based and may include equitable
        relief.  Judgment on the award rendered by the arbitrators may be
        entered in any court of competent jurisdiction.  The arbitrators shall
        award recovery of reasonable attorneys' fees and costs to the prevailing
        party.  The arbitrators' resolution of the dispute shall be final and
        binding, except that any party can appeal to 

       

       

      
        
           

        

        
           

          
            

          

        

        
          26

        

      

       

      the
        federal courts of the United States of America or, if the federal courts
        do not
        have jurisdiction, to the state courts to vacate and remand, or modify or
        correct the arbitration award for any of the grounds specified in the FAA
        or if
        the arbitrators committed prejudicial error in the application of substantive
        law to the established facts.  The procedures specified in this
        Section shall be the sole and exclusive procedures for resolution of disputes;
        provided, however, that nothing contained herein shall preclude any party
        from
        filing a judicial proceeding seeking equitable or injunctive
        relief.

      6.7           Irreparable
        Harm and Equitable Relief.  Each Party understands and
        acknowledges that any disclosure or misappropriation of any of the Confidential
        Information in violation of this Agreement may cause the disclosing Party
        irreparable harm, the amount of which may be difficult to ascertain, and
        therefore agrees that the disclosing Party shall have the right to apply
        to a
        court of competent jurisdiction for specific performance and/or 

       

       

      
        
           

        

        
           

          
            

          

        

        
          27

        

      

       

      an
        order
        restraining and enjoining any further disclosure or breach and for any other
        relief as the court may find appropriate.  The right of the disclosing
        Parties under this Section is to be in addition to the remedies otherwise
        available to the Parties at law or in equity.  Each Party that
        receives Confidential Information of the other Party expressly waives the
        defense that a remedy in damages will be adequate and any requirement in
        an
        action for specific performance or injunction for the posting of a bond by
        the
        enforcing Party prior to issuance or enforcement of the injunction or
        restraining order.

      6.8           Consent
        to Jurisdiction.  The Parties consent to the jurisdiction of the
        courts of Palm Beach County, Florida and the U.S. District Court for the
        Southern District of Florida for any action seeking the enforcement of this
        Agreement, including but not limited to any action to enforce an arbitration
        award or action seeking equitable relief as provided for in this
        Agreement.  The Parties waive any objection to venue in the courts of
        Palm Beach County, Florida and the U.S. District Court for the Southern District
        of Florida.  The Parties waive a trial by jury on any matter which may
        be tried to a jury.

       

       

      
        
           

        

        
           

          
            

          

        

        
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      6.9           Relationship
        of the Parties.  Both Parties are independent contractors under
        this Agreement.  Nothing in this Agreement is intended nor is it to be
        construed to create any partnership or joint venture between the Parties,
        notwithstanding the issuance by Nuvo to PMI of stock under section 2.2 of
        this
        Agreement, which stock is simply compensation for PMI and an investment by
        PMI
        in Nuvo.  Neither Party shall have any express or implied right or
        authority to assume or create obligations on behalf of or in the name of
        the
        other Party or to bind the other Party to any contract, agreement or undertaking
        with any other person or entity.

      6.10                      Counterparts.  This
        Agreement may be executed in one or more identical counterparts (including
        by
        facsimile or by electronic mail under a .pdf format) all of which shall be
        considered one and the same agreement and shall become effective when both
        one
        or more of the counterparts has been signed by each Party and delivered to
        the
        other Party, it being understood that both Parties need not sign the same
        counterpart.

      6.11
Public
        Release of
        Information.  Any public statement, verbal or written, regarding this
        Agreement and regarding the other Party shall be approved by the other Party
        in
        advance.  The foregoing shall not prevent either Party from issuing a press
        release or making a public filing to the extent required by law.

       

       

      
        
           

        

        
           

          
            

          

        

        
          29

        

      

       

      6.12                      Force
        Majeure.  Neither party shall be responsible for failure or delay
        in performance of its obligations under or in connection with this Agreement
        due
        in whole or part to causes of any type beyond its reasonable control, including
        but not limited to acts of God, governmental actions, fire, smoke, labor
        difficulty, shortages, war, revolution, civil disturbances, terrorism, sabotage,
        blockade, embargo, explosion, transportation problems, interruptions of power
        or
        of communication, failure of suppliers or subcontractors, or natural
        disasters.  Each Party acknowledges that it is each Party’s
        responsibility to obtain its own insurance coverage for the foregoing
        events.  

      

      

      In
        Witness Whereof, the parties have executed this Agreement to be effective
        as of
27th Nov, 2007.

       

      

      NUVO
        CHINA SOLAR ENERGY, INC.

      

      

      

      By:
        Henry Fong

         Its:
        President

       

       

      
 

      
        
           

        

        
           

          
            

          

        

        
          30

        

      

      

      

      PIONEER
        MATERIALS, INC.

      

      

      

      By:
        Leon Chiu

         Its:
        President

      

      

      

      Acknowledgment
–
Nuvo
        China Solar
        Energy, Inc.

      

      _______________________,
        the ________________________ of Nuvo China Solar Energy, Inc. ("Nuvo"),
        personally appeared before me on __________ __, 2007, and having been first
        duly
        sworn to tell the truth, stated that he is authorized by Nuvo to execute
        this
        Product Development Agreement (the "Agreement") on behalf of Nuvo, that he
        has
        read the Agreement, reviewed the Agreement with Nuvo's attorneys, and fully
        understands the terms of this Agreement, and that he has voluntarily executed
        this Agreement on behalf of Nuvo for the purposes and considerations set
        forth
        in this Agreement.

      

      

      ________________________________

            Notary
        Public

      

      

      Acknowledgment
–
Pioneer
        Materials, Inc.

      

      _______________________,
        the ________________________ of Pioneer Materials, Inc. ("PMI"), personally
        appeared before me on __________ __, 2007, and having been first duly sworn
        to
        tell the truth, stated that he is authorized by PMI to execute this Product
        Development Agreement (the "Agreement") on behalf of PMI, that he has read
        the
        Agreement, reviewed the Agreement with PMI's attorneys, and fully understands
        the terms of this Agreement, and that he has voluntarily executed this Agreement
        on behalf of Pioneer for the purposes and considerations set forth in this
        Agreement.

      

      

      ________________________________

            Notary
        Public

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