AGREEMENT
Exhibit 10.2
AGREEMENT
This Agreement is dated as of the 1st day of February, 2007, and is made by the undersigned
entities and individuals (the “Stockholders”), acting severally and not jointly, and Lime
Energy Co., a Delaware corporation (the “Company”).
W I T N E S S E T H:
WHEREAS, the Stockholders are parties with the Company to that certain Securities Purchase
Agreement dated as of June 29, 2006 (the “Purchase Agreement”; capitalized terms which are
used herein and are defined in the Purchase Agreement and not otherwise defined herein are used
with the meanings given such terms in the Purchase Agreement); and
WHEREAS, on June 7, 2006, the Company’s board of directors approved a 1 for 15 reverse split
of the Company’s common stock (the “Reverse Split”), such that every 15 outstanding shares
would be combined into one share, with such Reverse Split to be effective on June 15, 2006; and
WHEREAS, on June 29, 2006, the parties closed the transactions contemplated by the Purchase
Agreement and the Company issued to the Stockholders shares of the Company’s common stock, par
value $0.0001 per share, in the amounts set forth on Schedule I to the Purchase Agreement (with
respect to Purchasers) and in the amounts set forth on Schedule II to the Purchase Agreement (with
respect to Series E Holders); and
WHEREAS, at the time of entering into, and closing the transactions under, the Purchase
Agreement, the Company and the Stockholders believed that the Reverse Split had become effective
and the purchases of shares of common stock by the Purchaser and the conversion of shares of Series
E Preferred into shares of common stock by the Series E Holders under the Purchase Agreement were
premised on that understanding; and
WHEREAS, the parties now understand that the Reverse Split did not become effective on June
15, 2006 and only became effective when it was set forth in an amendment to the Company’s
certificate of incorporation duly adopted by the directors and stockholders of the Company in
accordance with the Delaware General Corporation Law and filed with the Secretary of State of
Delaware, which did not occur until January 23, 2007; and
WHEREAS, as a result of the foregoing, the Reverse Split became effective after the closing
under the Purchase Agreement and the shares of common stock issued to the Stockholders under the
Purchase Agreement have been subjected to the Reverse Split, such that every 15 of such shares have
been combined into one share of common stock on January 23, 2007; and
WHEREAS, the Stockholders may have rights against the Company by reason of the Reverse Split
not having been effective prior to closing under the Purchase Agreement, and the Company has
offered to issue additional shares of common stock to each of the Stockholders, as
more fully described below, to bring each Stockholder up to the number of shares which such
Stockholder acquired from the Company on June 29, 2006, in return for each Stockholder’s waiving
any claims which he, she or it may have against the Company arising by reason of the Reverse Split
not having been effective prior to the closing under the Purchase Agreement, and the Stockholders
have severally agreed to accept such offer as set forth herein;
NOW, THEREFORE, in consideration of the premises and mutual agreements contained herein, each
Stockholder, for itself only, hereby agrees with the Company as follows:
1. Offer to Issue Catch Up Shares; Release of Claims. Set forth below is a table
which lists each Stockholder and shows the number of shares of common stock issued to such
Stockholder by the Company on June 29, 2006 pursuant to closing under the Purchase Agreement (such
Stockholder’s “June 29 Shares”), the number of shares into which the June 29 Shares of such
Stockholder were combined on January 23, 2007 pursuant to the Reverse Split becoming effective on
that date, and the number of shares which the Company has offered to issue to such Stockholder
(such Stockholder’s “Catch-Up Shares”) in return for such Stockholder’s entering into this
Agreement and waiving any claims which he, she or it may have against the Company by reason of the
Reverse Split not having been effective prior to the closing under the Purchase Agreement and
becoming effective on January 23, 2007:
| Number Of "Catch | ||||||||||||
| No. Of June 29 | Number Of Shares | Up" Shares To Be | ||||||||||
| Stockholder | Shares Acquired | After Reverse-Split | Issued | |||||||||
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ |
1,854,200 | 123,613 | 1,730,587 | |||||||||
Augustine Fund LP |
2,628,000 | 175,200 | 2,452,800 | |||||||||
▇▇▇▇▇ ▇▇▇▇▇ |
25,000 | 1,667 | 23,333 | |||||||||
Cinergy Ventures II, LLC |
3,002,293 | 200,153 | 2,802,140 | |||||||||
▇▇▇▇ ▇▇▇▇▇▇▇ |
294,000 | 19,600 | 274,400 | |||||||||
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ |
400,000 | 26,667 | 373,333 | |||||||||
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ |
2,363,600 | 157,573 | 2,206,027 | |||||||||
▇▇▇▇▇▇ ▇▇▇▇▇▇ |
1,500,000 | 100,000 | 1,400,000 | |||||||||
▇▇▇▇▇ ▇▇▇▇▇ |
100,000 | 6,667 | 93,333 | |||||||||
▇▇▇▇ ▇▇▇▇▇▇ Hurvis |
||||||||||||
Revocable Trust |
540,053 | 36,004 | 504,049 | |||||||||
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ |
200,000 | 13,333 | 186,667 | |||||||||
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ |
14,603,400 | 973,560 | 13,629,840 | |||||||||
Laurus Master Fund Ltd. |
1,343,461 | 89,564 | 1,253,897 | |||||||||
Leaf Mountain Company, LLC |
3,315,900 | 221,060 | 3,094,840 | |||||||||
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ |
250,000 | 16,667 | 233,333 | |||||||||
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ |
2,363,600 | 157,573 | 2,206,027 | |||||||||
Nettlestone Enterprise Ltd. |
1,500,000 | 100,000 | 1,400,000 | |||||||||
SF Capital Partners |
4,237,600 | 282,507 | 3,955,093 | |||||||||
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ |
345,700 | 23,047 | 322,653 | |||||||||
Each Stockholder, as to himself, herself or itself only, hereby acknowledges and agrees
to the correctness of the information in the table set forth above as to such Stockholder, and
agrees to accept from the Company the designated number of Catch-Up Shares indicated for such
Stockholder in such table. In consideration for the Company’s issuance to such Stockholder of the
indicated number of Catch-Up Shares, such Stockholder hereby relinquishes, releases and waives any
claims he, she or it may have against the Company under the Purchase Agreement or otherwise in
respect of the Reverse Split not having been effective prior to closing under the Purchase
Agreement and becoming effective on January 23, 2007, including any claim for breach of any
warranty of the Company as to its outstanding capital stock.
The Company agrees with each Stockholder, severally, to issue to such Stockholder such
Stockholder’s Catch-Up Shares promptly (and in any event within five (5) business days) following
the execution of this Agreement by such Stockholder and delivery by such Stockholder to the Company
of the existing certificates evidencing his, her or its June 29 Shares for replacement. Each
Stockholder agrees to deliver such certificates to the Company as soon as practicable following
execution of this Agreement by such Stockholder. All certificates evidencing any Catch-Up Shares
shall be legended to the extent applicable under the Purchase Agreement with respect to the shares
issued thereunder.
2. Stockholders’ Representation and Warranty. Each Stockholder, for himself, herself
or itself only, hereby represents and warrants to the Company that such Stockholder has not sold,
transferred or otherwise disposed of any of the shares which were issued to it under the Purchase
Agreement, as such shares have been combined pursuant to the Reverse Split, and such Stockholder
continues to own all such shares. Each Stockholder acknowledges that the number of such
Stockholder’s Catch-Up Shares has been determined in reliance upon this representation and
warranty, and accordingly that in the event that this representation and warranty is untrue with
respect to such Stockholder, the Company shall be entitled to an equitable reduction to the number
of Catch-Up Shares issued to such Stockholder under this Agreement.
3. Registration Obligation. This Agreement shall not be construed to affect or modify
the Company’s obligation to have the Registration Statement declared effective in accordance with
Section 5.1 of the Purchase Agreement. Such obligation continues as provided in the Purchase
Agreement, and the Company agrees to include in such registration statement the Catch-Up Shares
issued to each Stockholders pursuant to this Agreement, except as has been otherwise agreed by the
Company and such Stockholder.
4. Miscellaneous.
(a) All of the WHEREAS clauses and other recitals at the beginning of this Agreement are
hereby incorporated into and made part of this Agreement.
(b) This Agreement shall be binding upon, and shall inure solely to the benefit of, each of
the parties hereto, and each of their respective heirs, executors, administrators, successors and
permitted assigns, and no other person shall acquire or have any right under or by virtue of this
Agreement.
(c) This Agreement may be amended only by written execution by all parties.
(d) THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE
PARTIES SHALL BE GOVERNED BY, THE LAWS OF THE STATE OF ILLINOIS. FURTHERMORE, EACH PARTY HERETO
HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE STATE OF ILLINOIS AND THE
UNITED STATES OF AMERICA FOR THE NORTHERN DISTRICT OF ILLINOIS IN ANY LEGAL PROCEEDING ARISING OUT
OF OR RELATING TO THIS AGREEMENT.
(e) This Agreement is an agreement between the Company and each of the Stockholders which
executes this Agreement, without regard to whether any other Stockholders execute this Agreement.
As between the Company and each Stockholder, this Agreement may be executed in one or more
counterparts, all of which shall be deemed but one and the same agreement between the Company and
such Stockholder and each of which shall be deemed an original. Delivery by facsimile by any
Stockholder to the Company of an executed counterpart of this Agreement shall be effective as an
original executed counterpart hereof and shall be deemed a representation that an original executed
counterpart hereof will be delivered. Delivery by facsimile by the Company to any Stockholder of
an executed counterpart of this Agreement shall be effective as an original executed counterpart
hereof and shall be deemed a representation that an original executed counterpart hereof will be
delivered to such Stockholder. It shall not be necessary for any Stockholder to deliver to any
other Stockholder, by facsimile or otherwise, an executed counterpart of this Agreement for the
signature of such signing Stockholder to be effective.
(f) THE PARTIES HERETO, AFTER CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT WITH
COUNSEL, EACH KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE IRREVOCABLY, ANY RIGHT TO A TRIAL BY
JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT.
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IN WITNESS WHEREOF, the undersigned have severally executed this Agreement as of the day and
year first above written.
By:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President and Chief Financial Officer
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President and Chief Financial Officer
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ REVOCABLE TRUST
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Trustee
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Trustee
CINERGY VENTURES II, LLC
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
LEAF MOUNTAIN COMPANY, LLC
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Manager
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Manager
AUGUSTINE FUND LP
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: President
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: President
SF CAPITAL PARTNERS, LTD.
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
NETTLESTONE ENTERPRISES, LTD
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Director
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Director
▇▇▇▇ ▇▇▇▇▇▇ HURVIS REVOCABLE TRUST
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇ Hurvis
Name: ▇▇▇▇ ▇▇▇▇▇▇ Hurvis
Title: Trustee
Name: ▇▇▇▇ ▇▇▇▇▇▇ Hurvis
Title: Trustee
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