Exhibit 10.5
[*] INDICATES
CONFIDENTIAL PORTION HAS BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE
COMMISSION
STRATEGIC ALLIANCE
AGREEMENT
THIS STRATEGIC
ALLIANCE AGREEMENT is entered into and effective as of December 29,
2006 by and between Cummins Power Generation Inc., a Delaware
corporation (“Cummins”) and Chapeau, Inc. d/b/a
BluePoint Energy, Inc., a Utah corporation
(“BluePoint”). Cummins and BluePoint are sometimes
referred to herein, individually, as a “Party” and,
together, as the “Parties.”
RECITALS
WHEREAS, Cummins has superior expertise in
developing, marketing, selling, distributing, servicing and
maintaining Cummins power generation and related products
(“Cummins Products”); and
WHEREAS, BluePoint
has superior expertise in developing, financing, packaging, and
engineering combined heat and power ( “CHP”) products 1
megawatt and below; and
WHEREAS, BluePoint
has developed expertise in marketing and funding its proprietary
discount energy purchase (“DEP”) agreements which
dramatically enhance market penetration of CHP products and
projects; and
WHEREAS, BluePoint
has developed the EnviroGen™ Energy Module line of products
(the “System”) and has expertise in integrating and
packaging the System; and
WHEREAS, Cummins desires for BluePoint to
integrate, manufacture and supply Systems integrating Cummins
Products exclusively, both diesel and natural gas prime
mover-based, and to be commercially co-branded as or similar to
EnviroGen™ Energy Module - Powered by Cummins Inside
; and
WHEREAS, Cummins and
BluePoint desire to develop state-of-the-art “packaged”
CHP co-branded EnviroGen™ Energy Modules - Powered by
Cummins Inside through prime mover technology collaboration;
and
WHEREAS, Cummins and BluePoint desire to make
available for sale on an exclusive basis, except as otherwise
precluded by any previous commitments, alliances or agreements
entered into by Cummins, EnviroGen™ Energy Modules -
Powered by Cummins Inside up to 1 megawatt in packaged
size through Cummins’s worldwide distribution network;
and
WHEREAS, the Parties
will mutually benefit from this Agreement due to the additional
credibility, product availability and revenues achieved; and
WHEREAS, Cummins and
BluePoint desire to enter into this Agreement to formalize a joint
strategic relationship;
NOW, THEREFORE, in
consideration of the obligations herein made and undertaken, the
Parties, intending to be legally bound, covenant and agree as
follows:
1. Cummins
Obligations . Cummins shall have the following obligations
under this Agreement:
(a) Integration
Assistance . Cummins, either directly or through a Cummins
authorized designee, will provide [*] assistance related to
integration of Cummins Products into the System.
(b) Technical
Training . Cummins , either directly or through a Cummins
authorized designee, will provide technical training to BluePoint
personnel with respect to Cummins Products. [*]
(c) Marketing
Activities . Cummins will assist in activities to jointly
co-brand and market the Systems through targeted members of
distribution and support network of Cummins. Marketing assistance
will be provided through Cummins for applications suitable for the
BluePoint System. [*]
(d) Service and
Maintenance Activities . Cummins will assist, either directly
or through a Cummins authorized designee, in activities to service,
maintain and support the [*] Systems, under a separately negotiated
maintenance agreement, throughout the distribution and support
network of Cummins. During the [*] first 12 months of this
Agreement, Cummins Service and Maintenance obligations will be
limited to the [*] unless authorized earlier by Cummins.
Furthermore, [*]BluePoint will use its best commercially reasonable
effort to identify geographies in which the System will be
deployed. [*]
(e) Supply Cummins
Products to BluePoint [*] . Cummins will use its best
commercially reasonable efforts to provide to BluePoint certain
Cummins Products [*]
(f) Key
Cummins Personnel . Key Cummins personnel will initially
include [*] and [*]; or their designees and other senior management
personnel as required.
2. BluePoint
Obligations . BluePoint shall have the following obligations
under this Agreement:
(a) Financing
Activities . BluePoint will use its best commercially
reasonable efforts to promote and enable the BluePoint DEP model
for those customers referred to BluePoint by Cummins or members of
the distribution and support network of Cummins that prefer not to
undertake the capital investment to build, own, operate and
maintain the System.
(c)
Manufacturing . BluePoint will assemble, manufacture and
package Systems incorporating Cummins Products exclusively.
[*]BluePoint will deliver Systems incorporating exclusively Cummins
Products to Cummins distributors and dealers [*]
(d) Technical
Training . BluePoint will provide technical training and
marketing materials with respect to the Systems to Cummins
personnel.
(e) Marketing
Activities . In addition to BluePoint’s own internal
sales efforts, BluePoint will also assist in activities to jointly
market the System and related cogeneration products, services and
support as requested by Cummins and/or Cummins distributors .
(f)
Evaluate Cummins Products . BluePoint will assess Cummins
Products [*]
(g
Purchase Estimates . BluePoint will provide for the 24-month
period subsequent to the effective date of this Agreement purchase
estimates of all prime movers as set forth in Exhibit A attached
hereto and a part hereof. [*]
(h) Key BluePoint
Personnel . Key BluePoint personnel will initially include Guy
A. Archbold, Chief Executive Officer of BluePoint and Steven P.
Brandon, Executive Vice President or their designees and other
senior management personnel as required.
3. Contact
Persons . Each of Cummins and BluePoint shall designate a
contact person for purposes of monitoring performance of each Party
under this Agreement. Initially, the contact person for Cummins
will be [*]and the contact person for BluePoint will be Guy A.
Archbold.
4. [*]
Installation . [*] The Parties agree that no integrated CHP
System, as contemplated by this Agreement, will be commissioned for
commercial sale and installation unless both Parties approve the
readiness of the product for the proposed application and
installation.
5. Exclusive
Alliance . During the term of this Agreement, neither Cummins,
nor BluePoint, nor their respective affiliates or subsidiaries will
enter into a similar joint strategic agreement with any competitor
of the other Party for the sole purpose of developing packaged CHP
products up to 1 megawatt in packaged size without prior written
consent of the other Party. [*]
6. Relationship of
the Parties . The relationship of Cummins and BluePoint is
solely that of independent contractors, and nothing in this
Agreement shall be construed to (i) give either party the power to
direct and control the day-to-day activities of the other or (ii)
constitute the parties as joint venturers, co-owners or otherwise
as participants in a joint or common undertaking or (iii) make
either party an agent of the other for any purpose whatsoever.
7. Protection of
Confidential Information . The Parties acknowledge and agree
that they are bound and shall continue to be bound by the terms of
that certain Mutual Nondisclosure Agreement dated October 27, 2006
by and between Cummins and BluePoint and that such Nondisclosure
Agreement shall continue in full force and effect for so long as
this Agreement has not been terminated.
A.
“Intellectual Property” means any inventions, ideas,
discoveries, developments, improvements, innovations, and know-how,
whether or not patentable; copyrightable works, such as reports,
databases, and documentation; trade secrets; such as software;
including source code and object code; compositions of matter;
procedures; and experimental results.
B. “Background
Intellectual Property” means all Intellectual Property
developed, conceived, or controlled by a Party or their respective
employees, agents, or contractors that was developed prior to the
effective date of this Agreement, prior to or separate from the
Program, and is necessary to utilize or otherwise practice the
BLUEPOINT Technology or CUMMINS Technology, as applicable. All
Background Intellectual Property is and shall remain the separate
intellectual property of the Party who developed, conceived, or
controlled it.
C. “BLUEPOINT
Reserved Intellectual Property” means all Intellectual
Property developed, conceived, or made by the Parties or their
employees, agents, or contractors, whether alone or in concert,
whether or not conceived, made, or developed during working hours,
solely in connection with and under the Program, but which
expressly excludes any Intellectual Property pertaining to:
i. packaging
combined heat and power systems; and
ii.
non-generator interfaces from combined heat and power
systems;
D. “CUMMINS
Reserved Intellectual Property” means all Intellectual
Property developed, conceived, or made by the Parties or their
employees, agents, or contractors, whether alone or in concert,
whether or not conceived, made, or developed during working hours,
solely in connection with and under the Program limited to that
Intellectual Property pertaining to:
i.
generators;
ii. interfaces
to generators;
iii. engines and
technologies associated with G-Drive engines;
iv. generator
technology necessary for all applications not part of the Program;
and
v. Any other
information or technology not otherwise set forth hereinunder in
Program Intellectual Property or Jointly Developed Intellectual
Property.
E. “CUMMINS
Technology” means all Intellectual Property disclosed by
CUMMINS under this Agreement, including but not limited to
materials, compositions, or products developed therefrom, whether
in existence prior to the effective date of this Agreement or
subsequently developed by Cummins independent of BLUEPOINT,
including all Background Intellectual Property of the CUMMINS and
CUMMINS Reserved Intellectual Property, or cooperatively with
BLUEPOINT under this Program excluding any BLUEPOINT Intellectual
Property or BLUEPOINT Technology
F. “BLUEPOINT
Technology” means all Intellectual Property disclosed by
BLUEPOINT under this Agreement, including but not limited to
materials, compositions, or products developed therefrom,
whether