EXHIBIT 10.19
PROMISSORY NOTE #2
THIS NOTE HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
SECURITIES LAWS OF ANY STATE. THIS NOTE MAY NOT BE TRANSFERRED OR
PLEDGED UNLESS IT HAS BEEN REGISTERED UNDER ALL APPLICABLE
SECURITIES LAWS, OR THE MAKER HAS RECEIVED AN OPINION OF COUNSEL
SATISFACTORY TO THE MAKER TO THE EFFECT THAT THE PROPOSED
TRANSACTION IS EXEMPT FROM SUCH REGISTRATION
REQUIREMENTS.
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Amount :
$1,155,473.74
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Date: October 6, 2008
(the " Closing Date ")
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FOR VALUE RECEIVED, inTEST
Corporation , a Delaware corporation (" Maker "),
promises to pay to Sandy L. Hoover, Trustee of the Sandy L.
Hoover Trust, a sub-trust of the Robert T. Stewart Separate
Property Trust dated March 17, 2003 (hereinafter referred to as
" Payee "), the principal sum of One Million One Hundred
Fifty-Five Thousand Four Hundred Seventy-Three Dollars and
Seventy-Four Cents ($1,155,473.74) in lawful money of the United
States of America, together with interest on the unpaid principal
amount at the "Prime Rate" plus one and one quarter percent
(1.25%). For the purposes of this Note, the " Prime Rate "
means a variable rate per annum equal to the rate of interest most
recently published by The Wall Street Journal as the "prime rate"
at large U.S. money center banks, which Prime Rate is, as of the
date of this Note, five percent (5%) per annum. This Note is
non-negotiable. The obligations under this Note are secured
pursuant to a security agreement dated as of even date herewith
among SigmaSYS Corp., Payee and the payee under the Ancillary Note
(defined below) (the " Security Agreement ").
This Note is one of two Notes
referred to in that certain Agreement and Plan of Merger dated as
of October 6, 2008 by and among Maker, Payee, Sigma Systems Corp.
and certain other parties (the " Merger Agreement "), and
together with the Ancillary Note (defined below) shall be subject
to setoff as set forth in the Merger Agreement, provided that any
such setoff against this Note shall be 75.77332% of the total
amount setoff. Any such setoffs against amounts due under this Note
shall be applied first to principal and then to interest. Except as
described in this paragraph, the obligations of Maker are an
absolute, unconditional and irrevocable promise to pay without
setoff or deduction all payments due strictly and according to the
terms of this Note and no reference to any collateral agreement is
intended to give rise to any right of setoff or
deduction.
By way of background, Maker
issued two promissory Notes under the Merger Agreement, this Note
and a promissory note of the same date and with identical terms,
except the payee and initial principal amount of such other note
are different (the " Ancillary Note ").
Principal and interest due under
this Note shall be payable as follows: (i) a payment of accrued but
unpaid interest on the first anniversary of the Closing Date; and
(ii) subsequent annual payments of principal and accrued but unpaid
interest on each of the next four anniversaries of the Closing
Date, with the amount of each such payments of principal and
interest