Sample Business Contracts

Promissory Note - Inc. and John Barbour

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                           NONRECOURSE PROMISSORY NOTE

$600,000.00                                                   New York, New York

                                                       Dated as of July 20, 2001

      FOR VALUE RECEIVED,  the undersigned,  JOHN BARBOUR  ("Borrower"),  hereby
unconditionally  promises to pay to the order of  TOYSRUS.COM,  INC., a Delaware
corporation (the "Company"), in lawful money of the United States of America and
in  immediately  available  funds,  the  principal  sum of Six Hundred  Thousand
Dollars  ($600,000.00)  ("Principal") with interest thereon from the date hereof
on the unpaid Principal as specified herein.  Interest shall be due and payable,
without notice, on the entire unpaid balance of Principal on each anniversary of
the date  hereof.  The  interest  rate on this note  shall be an annual  rate of
interest  equal to 7%.  Interest shall be computed on the basis of a year of 365
days and the actual  number of days  elapsed.  Interest  not paid when due shall
earn  interest  at the rate  specified  above.  The  entire  unpaid  balance  of
Principal and interest  hereunder shall be immediately due and payable,  without
notice,  on the earlier to occur of (i) the date  occurring  six (6) years after
the date of this Promissory  Note, (ii) the date of termination of employment of
Borrower with the Company for any reason whatsoever,  or (iii) the occurrence of
an Event of Default (as hereafter defined).

      If (a) Borrower fails to make any payment of Principal or interest on this
Promissory Note when due (provided  Borrower is provided with notice of any such
failure  and  provided  with ten days to cure  same),  (b) a court of  competent
jurisdiction  enters a  judgment,  decree or order for  relief in respect of the
Borrower  in an  involuntary  case or  proceeding  under  any  federal  or


state  bankruptcy  law,  which shall (i)  approve as  properly  filed a petition
seeking reorganization, arrangement, adjustment or composition in respect of the
Borrower,  (ii) appoint a custodian,  receiver,  trustee,  liquidator or similar
official for the Borrower or for substantially all of his property or assets, or
(iii) order the  winding-up or  liquidation  of its affairs,  and such judgment,
decree or order shall  remain  unstayed and in effect for a period of sixty (60)
consecutive  days, (c) Borrower attempts to sell,  transfer,  assign or encumber
the  Pledged  Shares (as  hereafter  defined)  (d)  Borrower  files a  voluntary
petition  seeking relief under any federal or state bankruptcy law, (e) Borrower
breaches any provision of the Pledge Agreement (as hereafter  defined) or of the
employment  agreement between Borrower and the Company dated as of July 17, 1999
or (f) Borrower expressly repudiates his obligations hereunder,  then all unpaid
Principal  and all accrued and unpaid  interest  on this  Promissory  Note shall
become and be immediately due and payable. The occurrence of any event described
in clauses (a) through (f) above shall be referred to as an "Event of Default".

      The Borrower  shall have the right to prepay all or any part of the unpaid
Principal amount of this Promissory Note with interest thereon, without premium,
at any time prior to the maturity hereof.

      This  Promissory  Note is a  nonrecourse  note and is secured  solely by a
pledge of shares of Common Stock of the Company (the "Pledged  Shares") pursuant
to a Pledge Agreement ("Pledge Agreement") of even date herewith, the provisions
of which are incorporated  herein by reference and form a part hereof.  Borrower
shall be liable upon the indebtedness evidenced by this Promissory Note, for all
sums to accrue or to become payable thereon and for performance of any covenants
contained  in this  Promissory  Note or in any of the related  documents  to the
extent,  but only to the extent,  of the Company's  security for the same, which
consists of all


properties,  rights,  estates and interests covered by the Pledge Agreement.  No
attachment, execution or other writ or process shall be sought, issued or levied
upon any  assets,  properties  or funds of Borrower  other than the  properties,
rights, estates and interests described in the Pledge Agreement. In the event of
foreclosure  of such  title,  liens or  security  interests,  no judgment of any
deficiency upon such indebtedness,  sums and amounts shall be sought or obtained
by the Company against Borrower.

      If one or more of the  provisions  hereof  shall be declared or held to be
invalid,  illegal,  or  unenforceable  in any respect in any  jurisdiction,  the
validity,  legality and enforceability of the remaining  provisions hereof shall
not in any way be  affected  or impaired  thereby  and any such  declaration  or
holding shall not invalidate or render unenforceable such provision in any other
jurisdiction. All references in this Promissory Note to Borrower and the Company
shall be deemed to  include,  as  applicable,  a reference  to their  respective
successors and assigns.  The provisions of this Promissory Note shall be binding
upon and shall  inure to the benefit of the  successors  and assigns of Borrower
and Company.

      Any notice  relating to this Promissory Note shall be in writing and shall
be deemed to be effective if given and received in the manner expressly provided
in the Pledge Agreement.

      In case this  Promissory  Note shall become  mutilated  or defaced,  or be
destroyed,  lost or stolen, the Borrower shall execute and deliver a new note of
like principal  amount in exchange and substitution for the mutilated or defaced
note, or in lieu of and in substitution for the destroyed,  lost or stolen note.
In the case of a mutilated or defaced  note,  the Company shall  surrender  such
Promissory  Note to the Borrower.  In the case of any destroyed,  lost or stolen
note, the Company shall furnish to the Borrower  evidence to its satisfaction of
the destruction, loss or theft of such note.


      Borrower hereby waives presentment for payment, demand, protest, notice of
protest and notice of dishonor or nonpayment of this Promissory Note.

      This Promissory Note shall be governed by and construed in accordance with
the  laws of the  State of New  York  without  regard  to any  conflict  of laws

      Each of  Borrower  and  Company  irrevocably  consents  and submits to the
non-exclusive jurisdiction of the Courts of the State of New York and the United
States  District  Court for the  Southern  District  of New York and  waives any
objection  based on venue or forum non  conveniens  with  respect  to any action
instituted  therein  arising  under  this  Promissory  Note or the  transactions
related  hereto,  in each case whether now existing or  hereafter  arising,  and
whether in  contract,  tort,  equity or  otherwise,  and agrees that any dispute
arising out of the  relationship  between Borrower and Company or the conduct of
such persons in connection with this Promissory Note or otherwise shall be heard
only in the courts described  above.  Each of Borrower and each Company confirms
that the foregoing waivers are informed and freely made.

      IN WITNESS WHEREOF,  the undersigned has signed,  dated and delivered this
note as of the date and year first above written.

                                                   /s/ John Barbour
                                                     John Barbour