Exhibit 10.40

PROMISSORY NOTE

USD $373,000

Houston, Texas

 

Effective January 8, 2018

 

FOR VALUE RECEIVED, Summer Energy Holdings, Inc., a Nevada corporation
(“Borrower”), promises to pay to Neil Leibman, an individual (“Lender”), or its
order, at such place as Lender may from time to time designate in writing, the
sum of Three Hundred Seventy Three Thousand Dollars ($373,000) (the “Loan”).   

 

1.Promise to Pay.  Borrower promises to pay to Lender or its order, in lawful
money of the United States of America, the principal sum of $373,000, together
with interest on the unpaid balance as set forth below.   

2.Interest.  Interest shall accrue on this promissory note (this “Note”) at the
rate of 5% per annum.  Interest will be calculated for the actual number of days
the principal is outstanding and based on a three hundred sixty five (365) day
year. 

3.Security.  This Note is unsecured.   

4.Maturity Date.   Absent the occurrence of an Event of Default hereunder and
the acceleration thereafter by Lender, the principal and all accrued interest
shall be due and payable in full on or before July 8, 2018 (the “Maturity
Date”).  If the Maturity Date should fall (whether by acceleration or otherwise)
on a day that is not a business day, payment of the outstanding amounts shall be
made on the next succeeding business day.  

5.Prepayment.  Borrower may prepay the Loan, in whole or in part, at any time
without penalty or premium.  

6.Application of Payments.  Unless otherwise agreed to in writing, or otherwise
required by applicable law, payments will be applied first, to costs of
collection incurred after an Event of Default, including reasonable attorney’s
fees; second, to payments made by Lender after an Event of Default to preserve
any collateral securing this Note, if any; third, to any accrued interest; and
fourth, to the principal.  All payments due hereunder shall be made (i) without
deduction of any present and future taxes, levies, imposts, deductions, charges
or withholdings, all of which amounts shall be paid by the Borrower, and (ii)
without any other set off. 

7.Event of Default.  The occurrence of any of the following shall be deemed to
be an event of default (“Event of Default”) hereunder: 

(a)Failure by Borrower to pay any monetary amount owed by it to Lender within
thirty (30) days of its due date, except for disputes being contested in good
faith; 

(b)Failure by Borrower to perform any other obligation under this Note, and
failure to cure such default within forty-five (45) days after written notice
from Lender; or 

(c)A bankruptcy petition is filed by Borrower or a bankruptcy filing is made
against Borrower and such involuntary petition is not dismissed within sixty
(60) days. 

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8.Remedies.  Upon the occurrence of an Event of Default, and after any
applicable notice period, at the option of Lender, the entire principal amount
of this Note together with all accrued interest thereon, if any, without demand
or notice, shall immediately become due and payable.  Upon the occurrence of an
Event of Default (and so long as such Event of Default shall continue), the
entire principal amount of this Note, together with all accrued interest
thereon, if any, all other amounts due, and any judgment for the principal,
interest, if any, and other amounts shall bear interest at the rate of 12% per
annum.  No delay or omission on the part of Lender in exercising any right under
this Note shall operate as a waiver of such right.  Upon the occurrence of an
Event of Default, and after any applicable notice period, Lender may exercise,
in addition to the rights and remedies granted hereby, all of the rights and
remedies of a Lender under the Uniform Commercial Code or any other applicable
law.   

9.Waiver.  Borrower hereby waives diligence, demand for payment, presentment for
payment, protest, notice of nonpayment, notice of protest, notice of intent to
accelerate, notice of acceleration, notice of dishonor, and notice of
nonpayment, and all other notices or demands of any kind (except notices
specifically provided for in this Note) and expressly agrees that, without in
any way affecting the liability of Borrower, Lender may extend any maturity date
or the time for payment of any installment due hereunder, accept additional
security, and release any security or guaranty.   

10.Successors and Assigns.  Except as otherwise provided herein, the terms and
conditions of this Note shall inure to the benefit of and be binding upon the
respective successors and assigns of the parties.  Nothing in this Note, express
or implied, is intended to confer upon any party other than the parties hereto
or their respective successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Note, except as expressly provided in
this Note. 

11.Change, Discharge, Termination, or Waiver.  No provision of this Note may be
changed, discharged, terminated, or waived except in a writing signed by the
party against whom enforcement of the change, discharge, termination, or waiver
is sought.  No failure on the part of Lender to exercise and no delay by Lender
in exercising any right or remedy under this Note or under the law shall operate
as a waiver thereof. 

12.Attorney’s Fees.  If any Event of Default occurs, Borrower promises to pay
all costs of enforcement and collection and preparation therefor, including but
not limited to, reasonable attorneys’ fees, whether or not any action or
proceeding is brought to enforce the provisions hereof (including, without
limitation, all such costs incurred in connection with any bankruptcy,
receivership, or other court proceedings, whether at the trial or appellate
level) or with regard to any arbitration proceeding. 

13.Notices. All notices and other communications given or made pursuant hereto
shall be in writing and shall be deemed effectively given:  (i) upon personal
delivery to the party to be notified, (ii) when sent by confirmed electronic
mail or facsimile if sent during normal business hours of the recipient; if not,
then on the next business day, (iii) five (5) days after having been sent by
registered or certified mail, return receipt requested, postage prepaid, or
(iv) one (1) day after deposit with a nationally recognized overnight courier,
specifying next day delivery, with written verification of receipt. 

14.Expenses and Attorneys’ Fees.  Borrower shall pay to Lender within ten (10)
days after written demand any and all expenses, including legal expenses and
reasonable retained attorneys’ fees, incurred or paid by Lender in enforcing
this Note.   

15.Severability.  If any provision of this Note is unenforceable, the
enforceability of the other provisions shall not be affected and they shall
remain in full force and effect. 

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16.Number and Gender.  In this Note the singular shall include the plural and
the masculine shall include the feminine and neuter gender, and vice versa. 

17.Headings.  Headings at the beginning of each numbered section of this Note
are intended solely for convenience and are not part of this Note. 

18.Choice of Law.  This Note shall be governed by and construed in accordance
with the laws of the state of Texas without giving effect to conflict of laws
principles. 

19.Binding Effect.  The Note will be binding upon, and inure to the benefit of
Lender, and their successors and assigns.  Borrower may not delegate its
obligations under the Note.   

20.Time of the Essence.  Time is of the essence with regard to each provision of
this Note as to which time is a factor. 

IN WITNESS WHEREOF, Borrower has executed and delivered this Note as of the day
and year first above written.

 

SUMMER ENERGY HOLDINGS, INC.

 

 

/s/ Jaleea P. George 

By: Jaleea P. George 

Its: Secretary and Chief Financial Officer 

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