EXHIBIT 10.4
EXECUTION COPY
WORLD ENERGY SOLUTIONS, INC.
SUBORDINATED NOTE DUE 2013
$2,000,000 November 7, 2005
For value received, WORLD ENERGY SOLUTIONS, INC., a Delaware corporation
(the "Company"), hereby promises to pay to MASSACHUSETTS CAPITAL RESOURCE
COMPANY or registered assigns (hereinafter referred to as the "Payee"), on or
before June 30, 2013, the principal sum of Two Million Dollars ($2,000,000) or
such part thereof as then remains unpaid pursuant to the terms set forth in that
certain Note and Warrant Purchase Agreement, dated as of November 7, 2005,
between the Company and Massachusetts Capital Resource Company (as the same may
be amended from time to time, hereinafter referred to as the "Agreement"), and
to pay interest from the date hereof on the whole amount of said principal sum
remaining from time to time unpaid at the rate of ten percent (10%) per annum,
such interest to be payable quarterly on the last day of March, June, September
and December in each year, the first such payment to be due and payable on
December 31, 2005, until the whole amount of the principal hereof remaining
unpaid shall become due and payable, and to pay interest at the rate of fourteen
percent (14%) (so far as the same may be legally enforceable) on all overdue
principal (including any overdue required redemption), premium and interest. All
or a portion of the principal amount of this Note must be redeemed in the
amounts and at the times set forth in Section 1.05 of the Agreement. Principal,
premium, if any, and interest shall be payable in lawful money of the United
States of America, in immediately available funds, at the principal office of
the Payee or at such other place as the legal holder may designate from time to
time in writing to the Company. Interest shall be computed on the basis of a
360-day year and a 30-day month.
This Note is issued pursuant to and is entitled to the benefits of the
Agreement, and each holder of this Note, by his acceptance hereof, agrees to be
bound by the provisions of the Agreement, including, without limitation, that
(i) this Note is subject to prepayment, in whole or in part, as specified in
said Agreement, (ii) the principal of and interest on this Note is subordinated
to Senior Debt, as defined in the Agreement and (iii) in case of an Event of
Default, as defined in the Agreement, the principal of this Note may become or
may be declared due and payable in the manner and with the effect provided in
the Agreement.
As further provided in the Agreement, upon surrender of this Note for
transfer or exchange, a new Note or new Notes of the same tenor dated the date
to which interest has been paid on the surrender Note and in an aggregate
principal amount equal to the unpaid principal amount of the Note so surrendered
will be issued to, and registered in the name of, the transferee or transferees.
The Company may treat the person in whose name this Note is registered as the
owner hereof for the purpose of receiving payment and for all other purposes.
In case any payment herein provided for shall not be paid when due, the
Company promises to pay all cost of collection, including all reasonable
attorney's fees.
This Note shall be governed by, and construed in accordance with, the laws
of the Commonwealth of Massachusetts and shall have the effect of a sealed
instrument.
The Company and all endorsers and guarantors of this Note hereby waive
presentment, demand, notice of nonpayment, protest and all other demands and
notices in connection with the delivery, acceptance, performance or enforcement
of this Note.
WORLD ENERGY SOLUTIONS, INC.
BY /s/ Xxxxxxx Xxxxxxxxx
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XXXXXXX XXXXXXXXX,
CHIEF EXECUTIVE OFFICER
[Signature Page to Subordinated Note]
