Secured Promissory Note - Brian P. Murphy and U.S. Concepts Inc.
SECURED PROMISSORY NOTE
$556,000 New York, New York
as of January 24, 2001
FOR VALUE RECEIVED, Brian P. Murphy, an individual with an
address at 225 Central Park West, #1420, New York, New York 10024 ("Borrower"),
hereby promises to pay to the order of U.S. Concepts, Inc., a New York
corporation ("Payee") with an address at 16 West 22nd Street, 2nd Floor, New
York, New York 10010, ON DEMAND, the principal sum of FIVE HUNDRED FIFTY SIX
THOUSAND DOLLARS ($556,000), or such lesser amount as shall equal the aggregate
unpaid principal amount of the loans made by Payee to Borrower under this note
("Note"), on the earlier to occur of (i) March 31, 2002, and (ii) the date that
Comedy Lab Productions, Inc. ("Comedy Lab") consummates an equity or debt
financing transaction in which it receives gross proceeds in excess of
$1,000,000.
The amount of each loan made by Payee to Borrower under this
Note, the date each such loan is made, and the amount of payment or prepayment
made by Borrower on account of such loans shall be endorsed by Payee on its
books, and, prior to any transfer of this Note, endorsed by Payee on the
schedule attached hereto or any continuation thereof. Such endorsements shall be
final and conclusive absent manifest error. Any failure by the Payee to so
endorse any such loan shall in no way mitigate or discharge the obligation of
Payee to repay any loans actually made.
The outstanding principal amount of this Note shall not bear
interest.
As security for his obligations hereunder, Borrower hereby
assigns, transfers and pledges to Lender, and grants Lender a security interest
in,(i) all payments payable to Borrower and Murphy Liquidating Corporation, a
New York corporation (of which Borrower is the sole shareholder) formerly known
as U.S. Concepts, Inc. ("Old US Concepts"), and all rights of Borrower and Old
US Concepts, pursuant to Section 2.4(b) of that certain Asset Purchase Agreement
dated as of December 29, 1998, by and among Borrower, Payee, Old US Concepts and
CoActive Marketing Group, Inc. (formerly Inmark Enterprises, Inc.), (ii) all
payments payable to Borrower, and the rights of Borrower, pursuant to Section
5.2 of that certain Employment Agreement dated as of December 29,1998 by and
between Payee and Borrower, (iii) all indebtedness of Comedy Lab from time to
time owed to Borrower, and (iv) all proceeds of the foregoing.
All payments due pursuant to this Note shall be made by check
to Payee at its address set forth above, or in immediately available funds by
wire transfer to Payee's account at such bank as Payee shall have previously
designated to Borrower.
Whenever any payment to be made hereunder shall be due on a
Saturday, Sunday or public holiday under the laws of the State of New York, such
payment may be made on the next succeeding business day.
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Borrower hereby waives presentment, demand for payment, notice
of dishonor, protest and notice of protest of this Note. No waiver of any
provision of this Note, or any agreement or instrument evidencing or providing
security for this Note, made by agreement of Payee and any other person or
party, shall constitute a waiver of any other terms hereof, or otherwise release
or discharge the liability of Borrower under this Note. No failure to exercise
and no delay in exercising, on the part of Payee, any right, power or privilege
under this Note shall operate as a waiver thereof nor shall simple or partial
exercise of any right, power or privilege preclude any other or further exercise
thereof, or the exercise of any other power, right or privilege. The rights and
remedies herein provided are cumulative and are not exclusive of any rights or
remedies provided by law.
Any provision of this Note that is prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforce ability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
This Note is governed by and to be construed in accordance
with the laws of the State of New York without regard to its doctrine of
conflict of laws. Borrower, by its execution hereof, (i) agrees that any legal
suit, action or proceeding arising from or related to this Note may be
instituted in a state or federal court located in the State of New York; (ii)
waives any objection which it may now or hereafter have to the laying of venue
of any such suit, action or proceeding; and (iii) irrevo cably submits to the
jurisdiction of any such court in any such suit, action or proceeding.
IN ANY ACTION, SUIT OR PROCEEDING IN RESPECT OF OR ARISING OUT OF THIS
NOTE, EACH OF PAYEE AND BORROWER WAIVES TRIAL BY JURY.
/s/ BRIAN P. MURPHY
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Brian P. Murphy
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