Promissory Note
$647,830.00
WHEREAS, Stuart Kaye was the founder and
shareholder of Destination Software, Inc., a New Jersey
Corporation, a recognized industry leader in the licensing,
development, publication, manufacture and sale of certain video
related products worldwide; and
WHEREAS, Stuart Kaye was an integral part of the
development of Destination Software, Inc., as a worldwide leader in
the licensing, development, publication and sale Of video related
products; and
WHEREAS, Stuart Kaye was a shareholder in
Destination Software, Inc., a New Jersey Corporation, having
acquired 90 shares in the Company based upon his association and
leadership within the Company; and
WHEREAS, prior to his death, Stuart Kaye had
transferred title to the shares to Stuart Kaye and Debra Kaye,
husband and wife, as community property with rights of
survivorship; and
WHEREAS, Stuart Kaye and Debra Kaye did continue
to own such shares of stock at the time of his death on or about
May 21, 2006; and
WHEREAS, prior to his death, the Shareholders of
Destination Software, Inc., had discussed and subsequently
implemented a Shareholders Agreement which provides for the
purchase of all outstanding common stock from the Estate of a
deceased shareholder; and
WHEREAS, Debra Kaye is the wife of Stuart Kaye
has duly survived him: and
WHEREAS, pursuant to the formula established for
the purchase of the shares of common stock of a deceased
shareholder, Destination Software, Inc., has agreed to pay to Debra
Kaye, individually and as surviving spouse of Stuart Kaye,
deceased, in exchange for the immediate return, transfer,
assignment and conveyance of the ninety (90) shares of common stock
owned by Stuart Kaye and Debra to Destination Software, Inc., upon
execution of this Note and payment of the initial payment hereunder
which shall constitute payment in full of all claims including any
claims based upon testate or intestate succession or any claims
which may arise or be due to the Estate of Stuart Kaye;
and
WHEREAS, based upon the within valuation
formula, the parties agree that Destination Software, Inc., is
obligated to pay to Debra Kaye, Individually as the surviving
spouse of Stuart Kaye, deceased, the sum of Six Hundred and Forty
Seven Thousand, Eight Hundred and Thirty ($647,830.00) Dollars in
full payment of all common stock owned or otherwise controlled by
Stuart Kaye and Debra Kaye which is represented to be ninety (90)
shares ofcommon stock issued to Stuart Kaye and Debra Kaye, husband
and wife, as community property with rights of survivorship in
Destination Software, Inc.; and
WHEREAS, the parties agree that upon the
execution of this Note by Destination Software, Inc., and the
payment of the initial amount under this Note, Debra Kaye, as the
surviving spouse of Stuart Kaye, deceased, will deliver to
Destination Software, Inc., all shares of common stock owned by the
late Stuart Kaye and Debra Kaye, represented to be ninety (90)
shares to Destination Software, Inc., or execute such documents as
may be required to evidence the transfer or conveyance of all
outstanding shares held by Stuart Kaye and Debra Kaye to
Destination Software, Inc., and
WHEREAS, in consideration for making this
payment, Debra Kaye, as the surviving spouse of Stuart Kaye, agrees
to indemnify and hold harmless Destination Software, Inc., from any
and all claims or assertions relative to the ownership of said
stock from any heir, beneficiary, personal representative,
administrator, executor or claimant under the Estate of Stuart
Kaye, deceased further
1. TERMS
AND CONDITIONS: DESTINATION SOFTWARE ("Obligor"),
a New Jersey Corporation, with a principal business address of 137
Hurffville Cross- Keys Road, Sewell, New Jersey 08080, for value
received, hereby promises to pay to Debra Kaye, individually and as
surviving spouse of Stuart Kaye and the Estate of Stuart Kaye,
deceased, ("Obligee"), with a principal address of30422 Le Port,
Laguna Niguel, California 92677, in lawful money of the United
States at the within address, the principal sum of Six Hundred and
Forty Seven Thousand, Eight Hundred and Thirty Dollars
($647,830.00), together with all accrued but unpaid nominal
interest fixed at the rate of 2.95 % thereon, in accordance with
the following terms:
On or before January 15,2007, Obligor shall pay
to Obligee the sum of Forty Seven thousand, Eight Hundred and
Thirty Dollars ($47,830.00) as an initial payment under this
Note.
Within ten (10) days following the receipt of
this initial payment, Obligee agrees to deliver, transfer, assign
and convey to the Obligor, all shares or certificates in the common
stock in Destination Software, Inc., owned by Stuart Kaye and Debra
Kaye and hereafter releases on behalf herself and on behalf of
Stuart Kaye, deceased any and all future claims or rights to the
aforesaid common stock, including but not limited too, the further
right to transfer or convey, the further right to participate in
the management and control of Destination Software, Inc., including
the right to vote the within shares of common stock, the right to
participate in the day to day operation ofthe Destination Software,
Inc., the right to convey, transfer or otherwise pledge or
hypothecate the common stock with the intent that Obligee will
irrevocably renounce all claims to the within common
stock.
Thereafter, commencing on or about February 15,
2007, Obligor agrees to pay to Obligee the sum of Six Hundred
Thousand Dollars ($600,000.00) Dollars, inclusive of principal and
interest, in monthly increments of Ten Thousand Dollars
($10,000.00) per month for sixty-five (65) months until paid in
full, with any balance and any accrued interest to be paid in full
prior to June 15,2012.
2.
SECURITY: The Note shall be secured
only by the full faith and credit of the Obligor. No other security
interest shall be provided to Obligee. Obligor agrees to make all
payments called for under the within Note. In the event of the sale
of Destination Software, Inc., all sums due and owing under this
Note shall become immediately due and payable to the
Obligee.
3.
PAYMENT
SCHEDULE: Obligor
shall make payments ofprincipal and interest in accordance with the
terms set forth above. Obligor understands that the within payments
are principal and interest. At the conclusion of all payments set
forth herein, Obligor shall have paid Obligee all sums due and
owing under the terms of this Note. The final payment under this
Note, will discharge the obligations of the Obligor and shall
satisfy all sums due and owing between the parties in exchange for
the outright conveyance of the common stock. Thereafter, neither
party shall have any claim against the other.. Obligor shall pay
the principal and interest payment in accordance with the following
schedule:
(a) Obligor shall pay to the order of the
Obligee, Debra Kaye, individually and as the surviving spouse of
Stuart Kaye, its
