Document:

ex10_4.htm

 10.4          Promissory Note, dated July 29, 2010, issued by Green Energy Management Services Inc.

PROMISSORY NOTE

	
$500,000.00

	
___________, 2010

FOR VALUE RECEIVED, the undersigned, Green Energy Management Services, Inc., a Delaware corporation ("Maker"), hereby promises to pay to the order of CDSS Wind Down, Inc., a Delaware corporation (“Payee”), having an address of 2100 McKinney Avenue, Suite 1500, Dallas, Texas 75201, at such address or at such other place as may be designated in writing by the Payee, or its assigns, the aggregate principal sum of Five Hundred Thousand Dollars ($500,000.00) or such other lesser amount as shall equal the outstanding principal amount hereof (the “Principal Amount”), together with compounding interest commencing to accrue on the date hereof and continuing on the outstanding Principal Amount at a rate per annum equal to six percent (6%) (computed on the basis of a 360-day year for the actual number of days elapsed) until this Note is paid in full, in accordance with the terms hereof.

The Principal Amount of this Note and all accrued and unpaid interest thereon shall be due and payable in full, and shall be paid by wire transfer or other immediately available funds to Payee, or its assigns, on December 31, 2010 (the “Maturity Date”).

Interest on the outstanding Principal Amount shall be due and payable at the Maturity Date, and shall be paid by wire transfer or other immediately available funds to Payee, or its assigns.  

Maker and each surety, endorser, guarantor and other party ever liable for payment of any sums of money payable upon this Note, jointly and severally, waive presentment, demand, protest, notice of protest and non-payment or other notice of default, notice of acceleration and intention to accelerate or other notice of any kind, and agree that their liability under this Note shall not be affected by any renewal or extension in the time of payment hereof, or in any indulgences, or by any release or change in any security for the payment of this Note, and hereby consent to any and all renewals, extensions, indulgences, releases or changes, regardless of the number of such renewals, extensions, indulgences, releases or changes.  No waiver by Payee of any of its rights or remedies hereunder or under any other document evidencing or securing this Note or otherwise, shall be considered a waiver of any other subsequent right or remedy of Payee; no delay or omission in the exercise or enforcement by Payee of any rights or remedies shall ever be construed as a waiver of any right or remedy of Payee; and no exercise or enforcement of any such rights or remedies shall ever be held to exhaust any right or remedy of Payee.

An "Event of Default" shall exist hereunder if any one or more of the following events shall occur and be continuing: (a) Maker shall fail to pay when due any principal of, or interest on, this Note, and such failure shall continue for three (3) business days following the date Payee notifies Maker of such failure; (b) Maker shall (1) apply for or consent to the appointment of a receiver, trustee, intervenor, custodian or liquidator of itself or of all or a substantial part of its assets, (2) be adjudicated a bankrupt or insolvent or file a voluntary petition for bankruptcy, (3) make a general assignment for the benefit of creditors, (4) file a petition or answer seeking reorganization or an arrangement with creditors or to take advantage of any bankruptcy or insolvency laws, or (5) file an answer admitting the material allegations of, or consent to, or default in answering, a petition filed against it in any bankruptcy, reorganization or insolvency proceeding, or take corporate action for the purpose of effecting any of the foregoing; (c) an order, judgment or decree shall be entered by any court of competent jurisdiction or other competent authority approving a petition seeking reorganization of Maker or appointing a receiver, trustee, intervenor or liquidator of Maker, or of all or substantially all of its respective assets, and such order, judgment or decree shall continue unstayed and in effect for a period of sixty (60) days; or (d) the occurrence of  a “default” or “event a default” which continues unremedied or unwaived for a period beyond any applicable cure period provided pursuant to the terms of any indebtedness for borrowed money of Maker in excess of $100,000, which entitles (or, with the giving of notice or lapse of time or both, would entitle) the holder of any such indebtedness to accelerate the maturity thereof. Upon the occurrence (and during the continuation) of any Event of Default, at the option of Payee and without notice to Maker, all accrued and unpaid interest, if any, shall be added to the Principal Balance, and the entire Principal Balance, as so adjusted, shall bear interest thereafter until paid at an annual rate equal to the lesser of (i) the per annum rate that is two percent (2%) in excess of the above-specified interest rate, or (ii) the maximum rate of interest allowed to be charged under applicable law, regardless of whether or not there has been an acceleration of the payment of principal as set forth herein (“Default Interest”).  All such Default Interest for the duration of the Event of Default shall be paid at the time of, and as a condition precedent to, the curing of any such Event of Default.

  

-19-

  

Upon the occurrence of any Event of Default, the Payee may (i) declare the entire unpaid balance of this Note to be immediately due and payable without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, anything contained herein to the contrary notwithstanding; and (ii) exercise any other right, power or remedy granted to it by law, either by suit in equity or by action at law, or both.

Whenever this Note requires or permits any notice, approval, request or demand from one party to another, the notice, approval, request or demand must be in writing and shall be deemed to have been given when personally served or when deposited in the United States mails, registered or certified, return receipt requested, addressed to the party to be notified at the following address (or at such other address as may have been designated by written notice):

	
  

	
Payee:

	
CDSS Wind Down, Inc.

	
  

	
2100 McKinney Avenue, Suite 1500

	
  

	
Dallas, Texas 75201

	
  

	
Attn: Steven B. Solomon

	
  

	
Maker:

	
Green Energy Management Services, Inc.

	
  

	
381 Teaneck Road

	
  

	
Teaneck, New Jersey 07666

	
  

	
Attn: Robert Weinstein

Maker reserves the right to prepay the outstanding principal balance of this Note, in whole or in part, at any time and from time to time, without premium or penalty. Any prepayment of this Note shall be applied first to the payment of interest or penalties accrued and unpaid on this Note and second to the payment of principal.

If action is instituted to collect on this Note, the Maker promises to pay all costs and expenses, including reasonable attorney’s fees, incurred in connection with such action.  All payments by the Maker under this Note shall be made without set-off, defense or counterclaim and be free and clear and without any deduction or withholding for any taxes or fees of any nature whatsoever, unless the obligation to make such deduction or withholding is imposed by law.

As used herein, the term “Payee” shall be deemed to include its successors, legal representatives and assigns, whether by voluntary action or by operation of law.  Payee shall be entitled to assign this Note to purchasers of the Payee’s notes.

This Note is being executed and delivered, and is intended to be performed in the State of Texas and the substantive laws of the State of Texas shall govern the validity, construction, enforcement and interpretation of this Note.  In the event of a dispute involving this Note or any other instruments executed in connection herewith, the undersigned irrevocably agrees that venue for such dispute shall lie in any court of competent jurisdiction in Dallas County, Texas.

[Remainder of page intentionally blank; signature page follows]

  

-20-

  

IN WITNESS WHEREOF, Maker has caused this Note to be executed and delivered by its duly authorized officer as of the date first above written.

MAKER:

Green Energy Management Services, Inc.

	
By:

	  	  
	
Name:

	  	  
	
Title:

	  	  
	  	  	  
	  	  	  
	
AGREED AND ACCEPTED:

	  
	  	  	  
	
PAYEE:

	  	  
	  	  	  
	
CDSS Wind Down, Inc.

	  
	  	  	  
	  	  	  
	
By:

	  	  
	
Name:

	  	  
	
Title:

	  	  

 

 

-21-Unassociated Document

    
      Exhibit 10.1

      
 

    

    UNITED STATES DEPARTMENT OF THE
TREASURY

    1500 Pennsylvania Avenue,
NW

    Washington, D.C.
20220

     

    August 4, 2010

     

    Ladies and
Gentlemen:

     

    Reference is made to that certain Letter
Agreement incorporating the Securities Purchase Agreement — Standard Terms (the
"Securities Purchase
Agreement"), dated as of
the date set forth on
Schedule A hereto, between the United States Department of the Treasury (the
"Investor")
and the company set forth
on Schedule A hereto (the "Company").
Capitalized terms used but
not defined herein shall have the meanings assigned to them in the Securities
Purchase Agreement. Pursuant to the Securities Purchase Agreement, at the
Closing, the Company issued to the Investor the number of shares of the series
of its preferred stock set forth on Schedule A hereto (the "Preferred Shares")
and a warrant to purchase
the number of shares of its common stock set forth on Schedule A hereto (the
"Warrant").

     

    In connection with the consummation of
the repurchase (the "Repurchase")
by the Company from the
Investor, on the date hereof, of the number of Preferred Shares listed on
Schedule A hereto (the "Repurchased
Preferred Shares"), as
permitted by the Emergency Economic Stabilization Act of 2008, as amended by the
American Recovery and Reinvestment Act of 2009:

     

    (a)           The Company hereby acknowledges receipt
from the Investor of the share certificate(s) set forth on Schedule A
hereto representing the Preferred Shares; and

     

    (b)           The Investor hereby acknowledges receipt
from the Company of a wire transfer to the account of the Investor set forth on
Schedule A hereto in immediately available funds of the aggregate purchase price
set forth on Schedule A hereto, representing payment in full for the
Repurchased Preferred Shares at a price per share equal to the Liquidation Amount per
share, together with any accrued and unpaid dividends to, but excluding, the date
hereof.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      Exhibit 10.1

    

     

    The Investor and the Company hereby
agree that, notwithstanding Section 4.4 of the Securities Purchase Agreement,
immediately following consummation of the Repurchase, but subject to compliance with applicable
securities laws, the Investor shall be permitted to Transfer all or a portion of the Warrant with
respect to, and/or exercise the Warrant for, all or a portion of the number of
shares of Common Stock issuable thereunder, at any time and without limitation,
and Section 4.4 of the
Securities Purchase Agreement shall be deemed to be amended in order to
permit the foregoing. The
Company shall take all steps as may be reasonably requested by the Investor to
facilitate any such Transfer.

     

    In addition, the Company agrees that in
the event it elects to repurchase the Warrant, it shall deliver to the Investor
within 15 calendar days of the date hereof a notice of intent to repurchase the
Warrant, which notice shall be in accordance with Section 4.9(b) of the
Securities Purchase
Agreement (the "Warrant Repurchase Notice").
In the event the Company
does not deliver the
Warrant Repurchase Notice to the Investor within 15 calendar days of the date
hereof, the Investor hereby provides notice, pursuant to Section 4.5(p) of the
Securities Purchase Agreement, of its intention to sell the Warrant, such notice
to be effective as of the first day following the end of such 15-day
period.

     

    In the event that the Company delivers a
Warrant Repurchase Notice and the Company and the Investor fail to agree on the
Fair Market Value of the Warrant pursuant to the procedures (including the
Appraisal Procedure), and in accordance with the time periods, set forth in
Section 4.9(c) of the Securities Purchase Agreement or the Company revokes the
delivery of such Warrant Repurchase Notice, then the Investor hereby provides
notice of its intention to sell the Warrant.

     

    This letter agreement will be governed
by and construed in accordance with the federal law of the United States if and
to the extent such law is applicable, and otherwise in accordance with the laws
of the State of New York applicable to contracts made and to be performed
entirely within such
State.

     

    This letter agreement may be executed in
any number of separate counterparts, each such counterpart being deemed to be an
original instrument, and all such counterparts will together constitute the same agreement. Executed
signature pages to this letter agreement may be delivered by facsimile and such
facsimiles will be deemed sufficient as if actual signature pages had been delivered.

     

    [Remainder of this page intentionally
left blank]

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    In witness whereof, the parties have
duly executed this letter agreement as of the date first written above.

     

    
      
        	 	UNITED
      STATES DEPARTMENT OF THE
      TREASURY	 
	 	 	 	 
	
                 

              	
                By:
      

              	
                /s/ Herbert M. Allison,
      Jr.

              	 
	 	 	Name:
      Herbert M. Allison,
      Jr.	 
	 	 	Title:
      Assistant Secretary for Financial
      Stability	 
	 	 	 	 

      

    

     

    
      
        	 	COMPANY:
      CITIZENS & NORTHERN CORPORATION	 
	 	 	 	 
	
                 

              	
                By:
      

              	/s/ Charles
      H. Updegraff, Jr.	 
	 	 	Name:
      Charles H. Updegraff, Jr.	 
	 	 	Title:
      President and CEO	 
	 	 	 	 

      

    

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    
 

    SCHEDULE A

     

    
      
        	
                General
      Information:

              	 
      	 
      
	 	 	 
	
                    Date of Letter
      Agreement incorporating the

              	 
      	 
      
	
                    Securities
      Purchase Agreement:

              	 
      	
                January 16,
      2009

              
	 	 	 
	
                    Name of the
      Company:

              	 
      	
                Citizens & Northern
      Corporation

              
	 	 	 
	
                    Corporate or
      other organizational form of the

              	 
      	 
      
	
                    Company:

              	 
      	
                Corporation

              
	 	 	 
	
                    Jurisdiction of
      organization of the Company:

              	 
      	
                Commonwealth of
      Pennsylvania

              
	 	 	 
	
                    Number and series
      of preferred stock issued

              	 
      	 
      
	
                    to the Investor
      at the Closing:

              	 
      	
                26,440 shares of Fixed Rate
      Cumulative

              
	 
      	 
      	
                Perpetual Preferred Stock, Series
      A

              
	 	 	 
	
                    Number of Initial
      Warrant Shares:

              	 
      	
                194,794

              
	 	 	 
	 	 	 
	
                Terms of the
      Repurchase:

              	 
      	 
      
	 	 	 
	
                    Number of
      Preferred Shares repurchased by

              	 
      	 
      
	
                    the
      Company:

              	 
      	
                26,440

              
	 	 	 
	
                    Share certificate
      number (representing the

              	 
      	 
      
	
                    Preferred Shares
      previously issued to the

              	 
      	 
      
	
                    Investor at the
      Closing):

              	 
      	
                No. 1

              
	 	 	 
	
                    Per share
      Liquidation Amount of Preferred

              	 
      	 
      
	
                    Shares:

              	 
      	
                $1,000

              
	 	 	 
	
                    Accrued and
      unpaid dividends on

              	 
      	 
      
	
                    Preferred
      Shares:

              	 
      	
                $290,105.56

              
	 	 	 
	
                    Aggregate
      purchase price for Repurchased

              	 
      	 
      
	
                    Preferred
      Shares:

              	 
      	
                $26,730,105.56

              
	
                Investor wire information for
      payment of purchase

              	 
      	 
      
	
                price

              	 
      	
                     ABA
      Number:

              
	 
      	 
      	
                     Bank:

              
	 
      	 
      	
                     Account
      Name:

              
	 
      	 
      	
                     Account
      Number:

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