CH ENERGY GROUP INC
$25,000,000 DEMAND NOTE OF GRIFFITH SERVICES, INC.
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>2
<FILENAME>d73390_ex10-1.txt
<DESCRIPTION>$25,000,000 DEMAND NOTE OF GRIFFITH SERVICES, INC.
<TEXT>
                                                                    Exhibit 10.1

[LOGO]  M&T Bank
        Manufacturers and Traders Trust Company

                                   DEMAND NOTE
                                    Maryland

January 18, 2008                                                  $25,000,000.00

BORROWER:   GRIFFITH ENERGY  SERVICES,  INC,  a corporation  organized under the
            laws of the State of New York,  with its chief  executive  office at
            6996 Columbia Gateway Drive, Columbia, Maryland.

BANK:       MANUFACTURERS  AND  TRADERS  TRUST  COMPANY,   a  New  York  banking
            corporation  with  banking  offices  at One M&T Plaza,  Buffalo,  NY
            14240. Attention: Office of General Counsel

1.          DEFINITIONS.  Each capitalized term shall have the meaning specified
            herein and the following terms shall have the indicated meanings:

      a.    "Authorized Person" shall mean, each individually, Daniel P. Dorney,
            Controller,  Mark Wagus,  CFO & Treasurer Mention of the  Authorized
            Person's name is for  reference  purposes only and the Bank may rely
            on a person's  title to ascertain  whether  someone is an Authorized
            Person.

      b.    "Adjustment Date", when applicable, shall mean two (2) Business Days
            before the first day of the applicable Interest Period.

      c.    "Base Rate" shall mean the highest prime rate  published in The Wall
            Street  Journal in its table  entitled  Money Rates or such  similar
            publication,  quoting service or commonly  available  source used by
            the Bank for determining prime rate ("Prime").

      d.    "Base Rate Loan" shall mean a Loan which bears  interest at the Base
            Rate.

      e.    "Business  Day"  shall  mean any day of the  year on  which  banking
            institutions in New York, New York are not authorized or required by
            law or other  governmental  action to close  and,  to the extent the
            LIBOR Rate is  applicable,  on which  dealings are carried on in the
            London Interbank market.

      f.    "CH Group" shall mean CH Energy Group, Inc., a New York corporation.

      g.    "CH Group Credit  Documents" shall mean all documents and agreements
            now  or  hereafter  evidencing  or  securing  the  CH  Group  Credit
            Facility,  including, but not limited to, the Credit Agreement dated
            November 21, 2003 executed by CH Group and CHEC, as borrowers.

      h.    "CH Group Credit  Facility"  shall mean the revolving line of credit
            facility being provided to CH Group and CHEC,  which is presently in
            the  maximum  principal  amount  of  Seventy-Five   Million  Dollars
            ($75,000,000.00),  as amended,  restated,  substituted,  replaced or
            otherwise modified from time to time

      i.    "CHEC" shall mean Central Hudson Enterprises Corporation, a New York
            corporation

      j.    "Continuation Date" shall mean the last day of each Interest Period

      k.    "Conversion  Date" shall mean the date on which Borrower's  election
            to  convert a Base Rate  Loan to a LIBOR  Rate Loan or a LIBOR  Rate
            Loan to a Base Rate Loan becomes  effective in accordance  with this
            Note.

      l.    "Draw Date" shall mean, in relation to any Loan, the Business Day on
            which such Loan is made, or to be made, to Borrower  pursuant to the
            Note.

      m.    "G.A.A.P."  shall mean,  with respect to any date of  determination,
            generally  accepted  accounting  principles as used by the Financial
            Accounting   Standards  Board  and/or  the  American   Institute  of
            Certified  Public  Accountants  consistently  applied and maintained
            throughout the periods indicated

      n.    "Interest  Period" shall mean, as to any LIBOR Rate Loan, the period
            commencing on the Draw Date,  the  Conversion  Date or  Continuation
            Date for such  LIBOR  Rate Loan and ending on the date that shall be
            the  numerically  corresponding  day (or, if there is no numerically
            corresponding  day, on the last day) of the  calendar  month that is
            one (1) month or two (2) months thereafter, in each case as Borrower
            may elect;  provided,  however, that if an Interest Period would end
            on a day that is not a Business Day,  such Interest  Period shall be
            extended  to the next  succeeding  Business  Day  unless  such  next
            succeeding  Business Day would fall in the next calendar  month,  in
            which  case  such  Interest  Period  shall  end on  the  immediately
            preceding Business Day

      o.    "LIBOR" shall mean the rate per annum (rounded upward, if necessary,
            to the nearest  1/16th of 1%) obtained by dividing (i) the one-month
            or  two-month  interest  period  London  Interbank  Offered Rate (as
            selected by  Borrower) as fixed by the British  Bankers  Association
            for United States dollar deposits in the London Interbank Eurodollar
            Market at  approximately  11:00 am London,  England time (or as soon
            thereafter  as  practicable)  as  determined  by the  Bank  from any
            broker, quoting service or commonly available source utilized by the
            Bank by (ii) a  percentage  equal to 100% minus the  stated  maximum
            rate of all reserves required to be maintained against "Eurocurrency
            Liabilities"  as  specified  in  Regulation  D (or against any other
            category of  liabilities  which  includes  deposits by  reference to
            which the interest rate on LIBOR Rate Loan or Loans is determined or
            any category of extensions of credit or other assets which  includes
            loans by a  non-United  States'  office of a bank to United  States'
            residents)  on such date to any member bank of the  Federal  Reserve
            System.   Notwithstanding  any  provision  above,  the  practice  of
            rounding to determine  LIBOR may be  discontinued at any time in the
            Bank's sole discretion.

      p.    "LIBOR Rate" shall mean 0.34  percentage  points above LIBOR with an
            Interest Period selected by Borrower

      q.    "LIBOR Rate Loan" shall mean a Loan which bears  interest at a LIBOR
            Rate

      r.    "Loan"  means a loan made to Borrower  by the Bank  pursuant to this
            Note.

      s.    "Maximum  Principal  Amount"  shall mean:  (a)  Twenty-Five  Million
            Dollars  ($25,000,000.00)  during the period between December 1st of
            each  year  and May 31st of each  following  year;  and (b)  Fifteen
            Million Dollars  ($15,000,000.00) during the period between June 1st
            and November 30th of each year.

      t.    "Outstanding  Principal  Amount"  shall mean the actual  outstanding
            principal amount under this Note at any time.

      u.    "Person"  shall  mean  any  individual,  corporation,   partnership,
            limited liability company, association,  joint-stock company, trust,
            estate,   unincorporated   organization,   joint   venture,   court,
            government  or political  subdivision  or agency  thereof,  or other
            legal entity.

                                 (C)Manufacturers and Traders Trust Company 2005

                                        1

<PAGE>

2.          PAYMENT OF PRINCIPAL, INTEREST AND EXPENSES

      a.    Promise  to Pay.  For value  received  and  intending  to be legally
bound,  Borrower promises to pay to the order of the Bank on demand, the Maximum
Principal Amount or the Outstanding  Principal Amount, if less; plus interest as
set forth below and all fees and costs (including without limitation  attorneys'
fees and disbursements, whether for internal or outside counsel) the Bank incurs
in order to collect any amount due under this Note,  to  negotiate or document a
workout or restructuring, or to preserve its rights or realize upon any guaranty
or other security for the payment of this Note ("Expenses").

      b.    Interest. Each Loan shall earn interest on the Outstanding Principal
Amount  thereof  calculated on the basis of a 360-day year for the actual number
of days of each year (365 or 366) that on each day shall be:

            i.    LIBOR Rate Loans. Interest  shall  accrue on a LIBOR Rate Loan
            from and including the first day of the Interest  Period  applicable
            thereto  until,  but not  including,  the last day of such  Interest
            Period or the day the LIBOR Rate Loan is paid in full (if sooner) at
            a rate per annum equal to the LIBOR Rate determined and in effect on
            (depending on the  circumstance):  (i) for new LIBOR Rate Loans, the
            Business  Day the Bank  receives (or is deemed to receive) a Request
            for a LIBOR Rate Loan;  (ii) for  automatic  continuations  of LIBOR
            Rate Loans pursuant to Section 4, the Adjustment Date for such LIBOR
            Rate Loan;  (iii) for  conversions  to LIBOR Rate Loans  pursuant to
            Section  4(a)(i) and  continuations  of LIBOR Rate Loans pursuant to
            Section 4(a)(iii),  the Business Day the Bank receives the Notice of
            Conversion  or  Notice  of  Continuation,  as the  case  may be,  in
            accordance with Section 4(b)

            ii.   Base Rate  Loans.  Interest  shall  accrue on a Base Rate Loan
            from and including the first date the Base Rate Loan was made (i.e.,
            the Draw Date or the  Conversion  Date,  as the case may be) to, but
            not  including,  the  day  such  Base  Rate  Loan is paid in full or
            converted,  at the rate per annum  equal to the Base Rate Any change
            in the Base Rate resulting from a change in Prime shall be effective
            on the date of such change

      c.    Maximum  Legal  Rate.  It is the intent of the Bank and of  Borrower
that in no event  shall  interest  be payable at a rate in excess of the maximum
rate permitted by applicable law (the "Maximum Legal Rate") Solely to the extent
necessary to prevent  interest  under this Note from exceeding the Maximum Legal
Rate,  any amount  that would be treated  as  excessive  under a final  judicial
interpretation  of  applicable  law shall be  deemed to have been a mistake  and
automatically  canceled,  and,  if  received  by the Bank,  shall be refunded to
Borrower.

      d.    Payments;  Late  Charge;  Default  Rate.  Payments  shall be made in
immediately  available  United  States  funds at any banking  office of the Bank
Absent demand for payment in full, interest shall be due and payable as follows:
unless  demanded  sooner,  (i) in respect to each Base Rate Loan,  monthly  when
invoiced  and (ii) in respect  to each LIBOR Rate Loan,  on the last day of each
Interest Period applicable  thereto. If payment is not received within five days
of its due date,  Borrower  shall pay a late charge equal to the greatest of (a)
5% of the  delinquent  amount,  (b) the  Bank's  then  current  late  charge  as
announced by the Bank from time to time, or (c) $50.00. In addition, if the Bank
has not actually  received any payment  under this Note within thirty days after
its due date,  from and  after  such  thirtieth  day the  interest  rate for all
amounts outstanding under this Note shall automatically increase to 5 percentage
points  above the higher of the Base Rate or the  highest  LIBOR  Rate,  and any
judgment  entered  hereon or  otherwise in  connection  with any suit to collect
amounts due  hereunder shall bear interest at such default rate. Payments may be
applied in any order in the sole  discretion  of the Bank but,  prior to demand,
shall be  applied  first to past  due  interest,  Expenses,  late  charges,  and
principal  payments,  if any,  which are past due, then to current  interest and
Expenses and late charges, and last to remaining principal

      e.    Prepayment of LIBOR Rate Loans. If (i) Borrower pays, in whole or in
part,  any LIBOR Rate Loan,  before the  expiration of its  respective  Interest
Period,  (ii) fails to draw down,  in whole or in part,  a LIBOR Rate Loan after
giving a Request therefor,  (iii) otherwise tries to revoke any LIBOR Rate Loan,
in whole or in part, or (iv) there occurs a Bankruptcy  Event or the  applicable
rate is converted from the LIBOR Rate to the Base Rate pursuant to Section 4(d),
then Borrower shall be liable for and shall pay the Bank, on demand,  the higher
of $250.00 or the actual amount of the liabilities,  expenses,  costs or funding
losses that are a direct or indirect result of such prepayment, failure to draw,
early  termination of an Interest Period,  revocation,  bankruptcy or otherwise,
whether such liability,  expense, cost or loss is by reason of (a) any reduction
in yield,  by reason of the  liquidation or reemployment of any deposit or other
funds  acquired by the Bank,  (b) the fixing of the interest rate payable on any
LIBOR Rate Loans or (c) otherwise The determination by the Bank of the amount of
foregoing  amount shall,  in the absence of manifest  error,  be conclusive  and
binding upon Borrower.

3.          LOANS

      a.    General.  Any Loan  hereunder  shall either be in the form of a Base
Rate Loan or a LIBOR Rate Loan.  The Bank may make any Loan in reliance upon any
oral, telephonic,  written,  teletransmitted or other request (the "Request(s)")
that the  Bank in good  faith  believes  to be valid  and to have  been  made by
Borrower or on behalf of Borrower  by an  Authorized Person. The Bank may act on
the Request of any  Authorized  Person until the Bank shall have  received  from
Borrower,  and had a  reasonable  time to act on,  written  notice  revoking the
authority  of such  Authorized  Person  The Bank  shall  incur no  liability  to
Borrower  or to any other  person as a direct or  indirect  result of making any
Loan pursuant to this paragraph

      b.    Request  for LIBOR  Rate  Loans.  Borrower  shall  give the Bank its
irrevocable Request for a LIBOR Rate Loan specifying:

            i.    the Draw Date for the LIBOR Rate Loan, which shall be at least
                  two (2) Business Days from the date of the Request;  provided,
                  however,  if a Request is received by the Bank after 2:00 p.m.
                  (Eastern  Standard Time), the Request for such LIBOR Rate Loan
                  shall be  deemed to have been  received  on the next  Business
                  Day;

            ii.   the aggregate amount of such LIBOR Rate Loan; and

            iii.  the applicable  Interest  Period (i.e,  one-month or two-month
                  Interest Period)

      c.    Requests  for Base Rate  Loans.  Borrower  may request any Base Rate
Loan not later than 2:00 p.m (Eastern  Standard  Time) on any proposed Draw Date
specifying the aggregate amount of such Base Rate Loan

                                 (C)Manufacturers and Traders Trust Company 2005

                                        2

<PAGE>

      d.    Delivery  of  Requests.  Delivery of a Notice or Request for a LIBOR
Rate  Loan or a Base  Rate  Loan  shall  be made  to the  Bank at the  following
address,  or such  other  address  designated  by the  Bank  from  time to time:

                        Manufacturers and Traders Trust Company

                        Attn: ______________________________________

                        Fax No (___________)________________________

                        Telephone No (_______)______________________

4.          CONTINUATIONS; CONVERSION ELECTIONS. Subject to the Borrower's right
set forth in this Section to make a contrary  election,  upon the  expiration of
the  first  Interest  Period  for a LIBOR  Rate  Loan and each  Interest  Period
thereafter,  on the Continuation Date, the LIBOR Rate Loan will be automatically
continued for another Interest Period with the same duration.

      a.    Election.  An Authorized  Person of Borrower  may, upon  irrevocable
            Request to the Bank,

            i.    elect to convert on any Business Day any Base Rate Loan into a
                  LIBOR Rate Loan;

            ii.   elect to  convert  any or a part of LIBOR  Rate Loan as of the
                  last day of the  applicable  Interest  Period into a Base Rate
                  Loan; or

            iii.  elect to  continue  all or a part of any LIBOR Rate Loan as of
                  the last day of the Interest  Period  applicable to such LIBOR
                  Rate Loan with an Interest  Period of a different  duration (i
                  e, either one-month or two-month Interest Period)

      b.    Notices.

            i.    For  an  election  under  Section  4(a)(i)  or  4(a)(iii),  an
                  Authorized  Person  must  deliver  to  the  Bank  by  2:00 p m
                  (Eastern  Standard  Time)  on  a  Business  Day  a  Notice  of
                  Conversion  ("Notice of  Conversion")  for an  election  under
                  Section 4(a)(i)  specifying the aggregate  amount of the Loans
                  to be  converted  or a  Notice  of  Continuation  ("Notice  of
                  Continuation")   for  an  election  under  Section   4(a)(iii)
                  specifying the duration of the requested Interest Period (i.e,
                  one-month  or  two-month  Interest  Period) and the  aggregate
                  amount of Loans to be continued with the new Interest Period.

            ii.   The  Continuation  Date  (resulting  from  an  election  under
                  4(a)(iii))  or  Conversion  Date (as the case may be) shall be
                  the later of (A) two (2)  Business  Days from the Business Day
                  the Bank  receives  the  Notice  of  Conversion  or  Notice of
                  Continuation  (either,  a  "Notice")  in  accordance  with the
                  foregoing Section or (B) the last day of the relevant Interest
                  Period if a Notice is  received  by the Bank more than two (2)
                  Business  Days before the last day of an Interest  Period If a
                  Notice is received after 2:00 p m (Eastern Standard Time), the
                  Notice  will be  deemed  to have  been  received  on the  next
                  Business Day Notice of Continuation received more than two (2)
                  Business  Days before the end of an Interest  Period  shall be
                  deemed to have been  received two (2) Business Days before the
                  end of such Interest  Period for purposes of  determining  the
                  LIBOR Rate for the next Interest  Period per Section  2(b)(i).
                  Accordingly,  if, for example,  Borrower has a LIBOR Rate Loan
                  with a one month  Interest  Period ending on June 15 and wants
                  to  continue  the LIBOR  Rate  Loan with a two month  Interest
                  Period,  Borrower  must  deliver  its  Notice of  Continuation
                  identifying  the new two month Interest  Period to the Bank by
                  2:00 p m (Eastern  Standard  Time) on June 13  (provided  that
                  June 13 and June 14 are Business  Days) If the Borrower  fails
                  to timely provide a Notice of  Continuation  such Notice shall
                  have no effect  and the LIBOR  Rate Loan  shall  automatically
                  continue for another Interest Period of the same duration

            iii.  For LIBOR Rate  Loans,  unless  the Bank  receives a Notice of
                  Conversion to convert such Loans to Base Rate Loans,  the Bank
                  shall  automatically  continue  such LIBOR Rate Loan for a new
                  Interest Period on the Continuation Date

            iv.   For an election under Section  4(a)(ii),  an Authorized Person
                  may  deliver  to the Bank a Notice of  Conversion  at any time
                  during an Interest  Period up to the last day of such Interest
                  Period  Any such  Notice  of  Conversion  delivered  during an
                  Interest  Period  shall  be  effective  on the last day of the
                  Interest Period.

            v.    The Bank may take  action on any Notice in  reliance  upon any
                  oral,  telephonic,  written or teletransmitted Notice that the
                  Bank in good faith  believes to be valid and to have been made
                  by Borrower or on behalf of Borrower by an Authorized  Person.
                  No Notice may be  delivered  by e-mail The Bank may act on the
                  Notice from any  Authorized  Person  until the Bank shall have
                  received from Borrower,  and had a reasonable  time to act on,
                  written  notice  revoking  the  authority  of such  Authorized
                  Person The Bank shall incur no liability to Borrower or to any
                  other  person as a direct or indirect  result of acting on any
                  Notice under this Note The Bank, in its sole  discretion,  may
                  reject any Notice that is incomplete

      c.    Unless the Bank shall otherwise consent in writing,  if Borrower has
failed to pay when due,  in whole or in part,  the  indebtedness  under the Note
(whether upon demand or otherwise)  the Bank,  in its sole  discretion,  may (i)
permit the LIBOR Rate to continue until the last day of the applicable  Interest
Period at which time such  Applicable Rate shall  automatically  be converted to
the Base Rate or (ii)  convert the LIBOR Rate to the Base Rate before the end of
the  applicable  Interest  Period  Notwithstanding  the  foregoing,  if Borrower
commences,  or has  commenced  against it, any  proceeding or request for relief
under any  bankruptcy,  insolvency or similar laws now or hereafter in effect in
the United  States of America or any state or  territory  thereof or any foreign
jurisdiction  or any  formal  or  informal  proceeding  for the  dissolution  or
liquidation  of,  settlement  of claims  against  or  winding  up of  affairs of
Borrower  (a  "Bankruptcy  Event"),  any  outstanding  LIBOR Rate Loans shall be
automatically  converted to Base Rate Loans without  further  action by the Bank
and Borrower shall have no right to have the Applicable  Rate converted from the
Base Rate to the LIBOR Rate Nothing  herein shall be construed to be a waiver by
the Bank to have any Loan accrue interest at the Default Rate of interest (which
shall be  calculated  from the higher of the LIBOR Rate or the Base Rate) or the
right of the Bank to the amounts set forth in Section 2(e) of this Note

                                 (C)Manufacturers and Traders Trust Company 2005

                                        3

<PAGE>

5.          COVENANTS.

      a.    Notices.  Borrower  shall  notify  the Bank in  writing:  (a) of any
notices  received by CH Group  relating to the financial  covenants set forth in
the CH Group Credit  Documents  within five (5) days after CH Group's receipt of
any such  notice;  (b) of the  first  advance  made  under  the CH Group  Credit
Facility  after the date of Note  within  three (3) days after  such  advance is
made;  and (c) of any  advances  made under the CH Group  Credit  Facility  that
reduces the amount available to borrow under the CH Credit Facility to less than
Fifty Million Dollars  ($50,000,000.00) within three (3) days after such advance
is made

      b.    Quarterly  Financial  Statements.  As soon as  available  and in any
event within  forty-five  (45)  calendar days after the end of each of the first
three quarters of each fiscal year,  Borrower shall submit to the Bank a balance
sheet of  Borrower  as of the end of such  quarter,  a  statement  of income and
retained  earnings  of  Borrower  for the  period  commencing  at the end of the
previous fiscal year and ending with the end of such quarter, and a statement of
cash flow of Borrower for the portion of the fiscal year ended with the last day
of such quarter,  all in reasonable  detail and stating in comparative  form the
respective  figures for the corresponding date and period in the previous fiscal
year and all  prepared in  accordance  with G.A.A.P and  certified  by the chief
financial officer of Borrower (subject to year end adjustments).

      c.    Annual Financial  Statements.  As soon as available and in any event
within  ninety (90) calendar days after the end of each fiscal year of Borrower,
Borrower  shall submit to the Bank a balance  sheet of Borrower as of the end of
such fiscal year and a statement of income and retained earnings of Borrower for
such fiscal year, and a statement of cash flow of Borrower for such fiscal year,
all in reasonable detail and stating in comparative form the respective  figures
for the corresponding  date and period in the prior fiscal year and all prepared
in  accordance  with G.A.A.P and  certified  by the chief  financial  officer of
Borrower

      d.    Financial  Covenants.  The  Borrower  shall cause CH Group to at all
times be in compliance  with all  financial  covenants set forth in the CH Group
Credit Documents

6.          DEMAND, DISCRETIONARY FACILITY.

      a.    Discretionary  Facility. The Bank may modify,  restrict,  suspend or
terminate  the credit  under  this Note at any time for any  reason and  without
affecting Borrower's then existing obligation under this Note. Any Request for a
Loan  hereunder  shall  be  limited  in  amount,  such  that  the sum of (i) the
principal  amount of such Request;  (ii) the Outstanding  Principal Amount under
this Note; and (iii) the aggregate  face amounts of (or, if greater,  Borrower's
aggregate  reimbursement  obligations to the Bank (or any of its  affiliates) in
connection  with)  any  letters  of  credit  issued  by the  Bank (or any of its
affiliates)  at the request (or for the benefit of)  Borrower,  pursuant to this
Credit;   does  not  exceed  the  Maximum  Principal  Amount  under  this  Note.
Notwithstanding  the above, the Bank shall have the sole and absolute discretion
whether to make any Loan (or any  portion of any Loan)  requested  by  Borrower,
regardless of any general availability under the Maximum Principal Amount.

      b.    Demand  Facility.  This is a demand Note and all  amounts  hereunder
shall  become  immediately  due and payable  upon demand by the Bank;  provided,
however,  that the Outstanding Principal Amount of this Note and all accrued and
unpaid interest shall automatically  become immediately due and payable upon the
occurrence  of a  Bankruptcy  Event with regard to Borrower or any  guarantor or
endorser of this Note. Borrower hereby waives protest, presentment and notice of
any kind in connection with this Note

7.          BANK  RECORDS  CONCLUSIVE. The Bank  shall set  forth on a  schedule
attached to this Note or maintained on computer, the date and original principal
amount of each Loan and the date and amount of each payment to be applied to the
Outstanding  Principal Amount of this Note The Outstanding  Principal Amount set
forth on any such  schedule  shall be  presumptive  evidence of the  Outstanding
Principal  Amount of this Note and of all Loans No  failure by the Bank to make,
and no error by the Bank in making,  any  annotation on any such schedule  shall
affect the Borrower's  obligation to pay the principal and interest of each Loan
or any other obligation of Borrower to the Bank pursuant to this Note.

8.          PURPOSE.  Borrower  certifies  (a)  that  no  Loan  will  be used to
purchase  margin stock except with the Bank's express prior written  consent for
each such  purchase,  (b) that  this Note  evidences  a  commercial  loan and an
extension  of credit for a  commercial  purpose  within the  meaning of Md Code,
Commercial  Law  Art.,  and (c) that  all  Loans  shall  be used for a  business
purpose, and not for any personal, family or household purpose

9.          AUTHORIZATION.  Borrower,  if a  corporation,  partnership,  limited
liability company,  trust or other entity,  represents that it is duly organized
and in good standing or duly constituted in the state of its organization and is
duly authorized to do business in all  jurisdictions  material to the conduct of
its business;  that the  execution,  delivery and  performance of this Note have
been duly  authorized by all necessary  regulatory  and corporate or partnership
action or by its governing instrument;  that this Note has been duly executed by
an authorized  officer,  partner or trustee and constitutes a binding obligation
enforceable  against  Borrower and not in  violation of any law,  court order or
agreement by which  Borrower is bound;  and that  Borrower's  performance is not
threatened by any pending or threatened litigation.

10.         INABILITY TO DETERMINE LIBOR RATES, INCREASED COSTS, ILLEGALITY.

      a.    Increased Costs. If the Bank shall determine that, due to either (a)
the introduction of any change (other than any change by way of imposition of or
increase in reserve requirements included in the calculation of the LIBOR) in or
in the  interpretation  of any requirement of law or (b) the compliance with any
guideline  or request  from any  central  bank or other  governmental  authority
(whether  or not having the force of law),  there  shall be any  increase in the
cost to the Bank of agreeing to make or making, funding or maintaining any LIBOR
Rate Loans, then Borrower shall be liable for, and shall from time to time, upon
demand therefor by the Bank and pay to the Bank such  additional  amounts as are
sufficient to compensate the Bank for such increased costs

      b.    Inability to Determine  Rates.  If the Bank shall determine that for
any reason adequate and reasonable means do not exist for ascertaining LIBOR for
any requested  Interest  Period with respect to a proposed  LIBOR Rate Loan, the
Bank will give notice of such determination to Borrower Thereafter, the Bank may
not make or maintain LIBOR Rate Loans,  as the case may be,  hereunder until the
Bank revokes such notice in writing.  Upon receipt of such notice,  Borrower may
revoke any  request  for a LIBOR Rate Loan or Notice  then  submitted  by it. If
Borrower does not revoke

                                 (C)Manufacturers and Traders Trust Company 2005

                                        4

<PAGE>

such notice the Bank may make,  or continue the Loans,  as proposed by Borrower,
in the amount  specified in the applicable  request  submitted by Borrower,  but
such Loans shall be made or continued  as Base Rate Loans  instead of LIBOR Rate
Loans, as the case may be

      c.    Illegality. If the Bank shall determine that the introduction of any
law (statutory or common), treaty, rule, regulation,  guideline or determination
of an  arbitrator or of a  governmental  authority or in the  interpretation  or
administration  thereof, has made it unlawful, or that any central bank or other
governmental  authority  has  asserted  that it is unlawful for the Bank to make
LIBOR Rate Loans, then, on notice thereof by the Bank to Borrower,  the Bank may
suspend  the  making of LIBOR Rate  Loans  until the Bank  shall  have  notified
Borrower  that the  circumstances  giving  rise to such  determination  shall no
longer  exist If the Bank shall  determine  that it is unlawful to maintain  any
LIBOR  Rate  Loans,  Borrower  shall  prepay in full all LIBOR  Rate  Loans then
outstanding,  together  with  accrued  interest,  either on the last date of the
Interest Period thereof if the Bank may lawfully continue to maintain such LIBOR
Rate Loans to such day, or immediately, if the Bank may not lawfully continue to
maintain such LIBOR Rate Loans. If Borrower is required to prepay any LIBOR Rate
Loan immediately as set forth in this subsection,  then  concurrently  with such
prepayment,  Borrower may borrow from the Bank, in the amount of such repayment,
a Base Rate Loan

11.         MISCELLANEOUS.  This  Note,  together  with  any  related  loan  and
security  agreements and guaranties,  contains the entire agreement  between the
Bank and  Borrower  with  respect to the Note,  and  supersedes  every course of
dealing, other conduct, oral agreement and representation previously made by the
Bank. All rights and remedies of the Bank under  applicable law and this Note or
amendment of any  provision  of this Note are  cumulative  and not  exclusive No
single,  partial or delayed  exercise  by the Bank of any right or remedy  shall
preclude the subsequent  exercise by the Bank at any time of any right or remedy
of the Bank without  notice No waiver or amendment of any provision of this Note
shall be effective unless made specifically in writing by the Bank. No course of
dealing or other conduct,  no oral agreement or representation made by the Bank,
and no usage of trade,  shall  operate as a waiver of any right or remedy of the
Bank.  No waiver of any right or remedy of the Bank  shall be  effective  unless
made  specifically  in writing  by the Bank. Borrower  agrees  that in any legal
proceeding,  a copy of this Note kept in the Bank's  course of  business  may be
admitted  into  evidence  as an  original.  This  Note is a  binding  obligation
enforceable  against  Borrower and its successors and assigns and shall inure to
the  benefit of the Bank and its  successors  and  assigns If a court  deems any
provision of this Note invalid, the remainder of the Note shall remain in effect
Section  headings are for  convenience  only Singular number includes plural and
neuter gender includes masculine and feminine as appropriate.

12.         NOTICES. Any demand or notice hereunder or under any  applicable law
pertaining  hereto  shall be in writing and duly given if  delivered to Borrower
(at its  address on the Bank's  records)  or to the Bank (at the address on page
one and separately to the Bank officer  responsible for Borrower's  relationship
with the Bank). Such notice or demand shall be deemed sufficiently given for all
purposes when delivered (i) by personal  delivery and shall be deemed  effective
when delivered,  or (ii) by mail or courier and shall be deemed  effective three
(3) business  days after  deposit in an official  depository  maintained  by the
United  States Post Office for the  collection  of mail or one (1)  business day
after  delivery  to a  nationally  recognized  overnight  courier  service (e g.
Federal  Express).  Notice by e-mail is not valid notice under this or any other
agreement between Borrower and the Bank

13.         GOVERNING  LAW;  JURISDICTION.  This Note has been  delivered to and
accepted  by the Bank and will be  deemed  to be made in the  State of  Maryland
Except as otherwise provided under federal law, this Note will be interpreted in
accordance with the laws of the State of Maryland excluding its conflict of laws
rules BORROWER HEREBY IRREVOCABLY CONSENTS TO THE EXCLUSIVE  JURISDICTION OF ANY
STATE OR  FEDERAL  COURT IN THE STATE OF  MARYLAND  WHERE THE BANK  MAINTAINS  A
BRANCH  AND  CONSENTS  THAT THE BANK MAY  EFFECT  ANY  SERVICE OF PROCESS IN THE
MANNER AND AT BORROWER'S ADDRESS SET FORTH ABOVE FOR PROVIDING NOTICE OR DEMAND;
PROVIDED THAT NOTHING CONTAINED IN THIS NOTE WILL PREVENT THE BANK FROM BRINGING
ANY ACTION,  ENFORCING  ANY AWARD OR JUDGMENT OR EXERCISING  ANY RIGHTS  AGAINST
BORROWER INDIVIDUALLY,  AGAINST ANY SECURITY OR AGAINST ANY PROPERTY OF BORROWER
WITHIN  ANY OTHER  COUNTY,  STATE OR OTHER  FOREIGN  OR  DOMESTIC  JURISDICTION.
Borrower  acknowledges  and  agrees  that the venue  provided  above is the most
convenient forum for both the Bank and Borrower Borrower waives any objection to
venue  and  any  objection  based  on a more  convenient  forum  in  any  action
instituted under this Note

14.         WAIVER  OF JURY  TRIAL.  BORROWER  AND THE  BANK  HEREBY  KNOWINGLY,
VOLUNTARILY, AND INTENTIONALLY WAIVE ANY RIGHT TO TRIAL BY JURY BORROWER AND THE
BANK MAY HAVE IN ANY ACTION OR  PROCEEDING,  IN LAW OR IN EQUITY,  IN CONNECTION
WITH  THIS NOTE OR THE  TRANSACTIONS  RELATED  HERETO  BORROWER  REPRESENTS  AND
WARRANTS THAT NO REPRESENTATIVE OR AGENT OF THE BANK HAS REPRESENTED,  EXPRESSLY
OR  OTHERWISE,  THAT THE BANK WILL  NOT,  IN THE  EVENT OF  LITIGATION,  SEEK TO
ENFORCE THIS JURY TRIAL  WAIVER.  BORROWER  ACKNOWLEDGES  THAT THE BANK HAS BEEN
INDUCED TO ENTER INTO THIS NOTE BY, AMONG OTHER THINGS,  THE  PROVISIONS OF THIS
SECTION.

Acknowledgment.  Borrower  acknowledges that it has read and understands all the
provisions of this Note, including the Governing Law, Jurisdiction and Waiver of
Jury Trial, and has been advised by counsel as necessary or appropriate

WITNESS the due execution  hereof as a SEALED  INSTRUMENT the day and year first
above written

TAX ID/SS # 522267334                        GRIFFITH ENERGY SERVICES, INC

                                             By: /s/ Mark Wagus           [SEAL]
                                                 -------------------------
                                                 Name: Mark Wagus
/s/ Russell S. Cotner                            Title: CFO
----------------------------------------
Signature of Witness

Russell S. Cotner
--------------------------------
Typed Name of Witness

                                 (C)Manufacturers and Traders Trust Company 2005

                                        5

<PAGE>

                                 ACKNOWLEDGMENT
STATE OF MD)
                                :SS.
COUNTY OF ANNE ARUNDEL

      On the 18th day of JANUARY,  in the year 2008, before me, the undersigned,
a  Notary  Public  in and for  said  State,  personally  appeared   MARK  WAGUS,
personally known to me or proved to me on the basis of satisfactory  evidence to
be the individual(s)  whose name(s) is (are) subscribed to the within instrument
and  acknowledged  to me that  he/she/they  executed  the same in  his/her/their
capacity(ies),  and that by  his/her/their  signature(s) on the instrument,  the
individual(s),  or the  person  upon  behalf  of which the  individual(s) acted,
executed the instrument

                                   /s/ W. Timothy Appler
                              --------------------------------------------------
                                                Notary Public

                                              W. TIMOTHY APPLER
                                                NOTARY PUBLIC
                              [SEAL]         ANNE ARUNDEL COUNTY
                                                  MARYLAND
                                      My Commission Expires Dec 1, 2010

--------------------------------------------------------------------------------

                                FOR BANK USE ONLY

Authorization Confirmed:________________________________________________________
Product Code: 11900
Disbursement of Funds:

<TABLE>
<S>                            <C>                        <C>
Credit A/C  #________________  Off Ck #________________   Payoff Obligation #________________

            $________________         $________________                     $________________
</TABLE>

                                 (C)Manufacturers and Traders Trust Company 2005

                                        6
</TEXT>
</DOCUMENT>
