Exhibit 10.4
LIMITED RECOURSE TERM NOTE
$2,000,000
Albany, New York
September 20, 2002
On or before October 1, 2019, for value received, EAC Operations,
Inc.,
a New York corporation ("Borrower"), promises to pay to Ridgewood
Electric Power
Trust II ("Lender"), or order, at its place of business at 947
Linwood Avenue,
Ridgewood, New Jersey 07450, or such other place as the holder of
this Note may
designate, the principal sum of Two Million Dollars ($2,000,000.00)
U.S., or, if
less, the outstanding principal balance of all loans and advances
made by Lender
hereunder, together with accrued interest at the rate set forth
below calculated
on the basis of the actual days elapsed and a 365-day year and a
366-day leap
year.
1. Interest
Rate. Interest shall accrue at the rate of Ten Percent (10%)
per annum.
2. Payment.
Principal and interest shall be payable as follows:
(a)
On October 1, 2002, Borrower shall make a payment of all
interest that has accrued on this Note from the date of this Note
through
September 30, 2002.
(b)
On
the 1st day of each month, beginning on November 1, 2002, and
continuing I until, and including, October 1, 2004, Borrower shall
make a
monthly payment of interest only of Sixteen Thousand Six Hundred
Sixty Six
Dollars and Sixty Seven Cents ($16,666.67).
(c)
On the 1st day of each month, beginning on November 1, 2004,
and
continuing until maturity, Borrower shall make a combined monthly
payment of
principal and interest of Twenty One Thousand Four Hundred Ninety
Two Dollars
and Ten Cents ($21,492.10), which amount consists of a principal
payment
sufficient to amortize the outstanding principal balance of this
Note over a
period of 15 years from October 1, 2004, plus all accrued interest
and charges.
(d)
The entire principal balance of this Note, plus accrued and
unpaid interest and any other charges due hereunder, shall be due
and payable on
October 1, 2019, if not paid sooner.
(e)
Notwithstanding the foregoing, prior to October 1, 2004,
Borrower will have the option to defer up to fifty percent (50%) of
the interest
payment due in any given month upon delivery of notice of such
deferral to
Lender. All amounts so deferred shall be added to the principal
amount of this
Note and bear interest at ten percent (10%) per annum beginning on
October 1,
2004. The combined monthly payment of principal and interest set
forth above
shall be increased to reflect the addition of such deferred
interest to the
principal amount of this Note and the interest accruing
thereon.
(f)
Other than as provided in Section 2(e) above, at the option of
Lender, any interest not paid within thirty (30) days of the date
it becomes
due, shall be added to principal and become a part thereof, and
thereafter bear
interest at the same rate (including any applicable default rate)
as the
principal.
1
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3.
Prepayment. This Note may be prepaid in whole, but not in part, at
any
time with the following prepayment premium: if this Note is prepaid
in whole
prior to the third anniversary of the date of this Note, the
prepayment premium
shall be Four Hundred Thousand Dollars ($400,000.00); if this Note
is prepaid in
whole on or after the third anniversary of the date of this Note,
the prepayment
premium shall decrease by Forty Thousand Dollars ($40,000.00) as of
such third
ann
