PROMISSORY NOTE
New York, New York
April 19, 2007 $800,000.00
FOR VALUE RECEIVED, THINKPATH INC., an Ohio corporation, ("Maker"),
promises to pay to the order of JOHN KENNEDY AND CECELIA KENNEDY, New Jersey
residents ("Holders"), the principal sum of Eight Hundred Thousand Dollars
(U.S.) ($800,000.00) subject to Section 3 set forth below as follows:
1. COMMENCEMENT Commencing on January 15, 2008 and continuing monthly
thereafter on the fifteenth day of each such month until January 15, 2013
("Maturity Date," unless the Maturity Date is accelerated to an earlier date
pursuant to Section 4 below), the Issuer shall make monthly payments in the
amount of Thirteen Thousand Three Hundred Thirty-Three dollars and thirty-three
cents ($13,333.33)(U.S.) (the "Monthly Payments") for sixty (60) consecutive
months.
2. PAYMENTS All payments in respect of this Note shall be made by valid
check payable to: JOHN KENNEDY & CECELIA KENNEDY, 198 KINGS ROAD, MADISON, NJ
07940, in immediately available funds, or at such other place as the Holders may
designate in writing. Payments must be RECEIVED by the Holders by the due date.
3. INTEREST The outstanding Principal Amount shall bear interest at an
annual rate of six percent (6%). Interest shall be due and payable on a monthly
basis with the first payment due with the principal payment on January 15, 2008.
If any Event of Default (as defined in Section 4 below) has occurred and is
continuing, the outstanding Principal Amount of this Note, together with any
accrued and unpaid Interest, and all other amounts provided for herein
(collectively, the "Note Amount") shall bear interest from and after such Event
of Default at an annual rate of eight percent (8%). All computations of Interest
hereunder shall be made based on the actual number of days elapsed in a year of
365 days (including the first day but excluding the last day during which any
such Principal Amount is outstanding). The Note Amount shall be due and payable
in full on the Maturity Date.
4. EVENT OF DEFAULT; ACCELERATION. The Maturity Date shall be
accelerated and the Note Amount shall become immediately due and payable upon
the occurrence of any of the following events (each an "Event of Default"):
(a) the dissolution of the Maker or Thinkpath, Inc., an Ontario
corporation (the "Guarantor");
(b) the admission in writing of the Maker's or the Guarantor's
inability to pay its debts as they become due;
(c) any assignment by the Maker or the Guarantor for the benefit of
creditors;
(d) any application by the Maker or the Guarantor for appointment of
a receiver;
(e) the commencement by the Maker or the Guarantor of a voluntary
case under any provision of the Federal Bankruptcy Code (the
"Code") or amendments thereto or any other federal or state law
or Canadian law affording relief to debtors;
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(f) there shall be commenced against the Maker or the Guarantor any
such proceeding, application or an involuntary case under the
Code or Canadian law, which proceeding, application or case is
not dismissed or withdrawn within ninety (90) days of
commencement or filing, as the case may be;
(g) failure of the Maker to pay an installment of Interest or
Principal when due;
(h) if, at any time while this Note is outstanding, Holders' designee
is not a member of the Board of Directors of Thinkpath Inc.,
Maker's parent company; or
(i) upon a Change of Control (as defined immediately below) of the
Maker or the Guarantor. For purposes hereof, "Change of Control"
means the occurrence of any of the following events:
(i) Ownership. After the date of this Note, any "Person" (as
such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended) who is not an owner of the
Maker's (or, if applicable, Guarantor's) outstanding voting
securities as of the date of this Note becomes the "Beneficial
Owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, in a single transaction or series of related
transactions, of securities of the Maker (or, if applicable,
Guarantor) representing more than 50% of the total voting power
represented by the Maker's (or, if applicable, Guarantor's) then
outstanding voting securities or more than 50% of the value of
all outstanding securities of the Maker (or, if applicable,
Guarantor), excluding for this purpose the Maker, the Guarantor,
their Affiliates (as that term is defined under Rule 405 of the
Securities Act of 1933, as amended, including, without
limitation, executive officers and directors of the Maker or the
Guarantor), senior management of the Maker or the Guarantor as of
the date of this Note, or any employee benefit plan of the Maker
or the Guarantor (including, without limitation, an Employee
Stock Ownership Plan as defined in Section 4975 of the Internal
Revenue Code of 1986, as amended); or
(ii) Merger/Sale of Assets. A merger or consolidation of the
Maker or the Guarantor, other than a merger or consolidation that
would result in the voting securities of the Maker or the
Guarantor outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity or the parent of
such corporation) at least 50% of the total voting power
represented by the voting securities of the Maker or the
Guarantor or such surviving entity or parent of such corporation
outstanding immediately after such merger or consolidation, or
the stockholders of the Maker or the Guarantor approve an
agreement for the sale or disposition by the Maker or the
Guarantor of all or substantially all of the Maker's or the
Guarantor's assets.
In the event of a default under subsection 4(g) above, the Company will
have five (5) days to cure such default to avoid acceleration. Any such cure
must be RECEIVED by Holders within five (5) days of the original due date of the
payment.
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(5) COLLECTION COSTS; ATTORNEY'S FEES In the event this Note is turned
over to an attorney for collection, or the Holders otherwise seek advice of an
attorney in connection with the exercise or enforcement of its rights hereunder,
Maker agrees to pay all reasonable costs of collection, including reasonable
attorney's fees and expenses and all out-of-pocket expenses incurred by the
Holders in connection with such collection efforts, which amounts may, at the
Holders' options, be added to the principal hereof.
(6) OBLIGATION TO PAY PRINCIPAL AND INTEREST; COVENANTS No provision of
this Note shall alter or impair the obligation of Maker, which is absolute and
unconditional, to pay the principal of and interest on this Note at the place,
at the respective times, at the rates, and in the currency herein prescribed.
(7) NO SET-OFF RIGHT All payments by the Maker pursuant to this Note shall be
made without set-off or counterclaim.
(8) MISCELLANEOUS
(a) BENEFIT. This Note shall be binding upon and
inure to the benefit of the Maker, the Holders, and their legal
representatives, successors or assigns.
(b) GOVERNING LAW. This Note and any dispute,
disagreement, or issue of construction or interpretation arising
hereunder whether relating to its execution, its validity, the
obligations provided therein or performance shall be governed by and
Construed in accordance with the laws of the State of New Jersey
without regard to its conflicts of law principles. Maker and Holders
consent to the exclusive jurisdiction of the state and federal courts
sitting in New Jersey in connection with any dispute arising out of or
relating to this Note and hereby waive, to the maximum extent permitted
by law, any objection, including any objection based on FORUM NON
COVENIENS, to the bringing of any such proceeding in such
jurisdictions. Maker and Holders agree that service of process by
certified mail to its address shall be deemed in every respect
effective service of process upon it in any such suit, action or
proceeding.
(c) WAIVER OF JURY TRIAL. To the fullest extent
permitted by applicable law, Maker and the Holders hereby irrevocably
and expressly waive all right to a trial by jury in any action,
proceeding, counterclaim (whether based upon contract, tort or
otherwise) arising out of or relating to this Note, or other documents
entered in connection herewith or the transactions contemplated hereby.
(d) SECTION HEADINGS. Section headings herein have
been inserted for reference only and shall not be deemed to limit or
otherwise affect, in any matter, or be deemed to interpret in whole or
in part any of the terms or provisions of this Note.
(e) SURVIVAL OF REPRESENTATIONS, WARRANTIES AND
AGREEMENTS. The representations, warranties and agreements contained
herein shall survive the delivery of this Note.
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(f) SEVERABILITY. In case any one or more of the
provisions contained in this Note shall be deemed invalid, illegal, or
unenforceable in any respect, the validity, legality and enforceability
of the remaining provisions contained herein shall not in any way be
affected or impaired thereby.
(g) ENTIRE AGREEMENT. This Note, the other documents
entered in connection herewith, and the transactions contemplated
hereby constitute the entire understanding between the parties with
respect to the subject matter hereof, superseding all prior
negotiations, discussions and agreements.
IN WITNESS WHEREOF, this Note has been executed and delivered
on the date specified above by the duly authorized representative of the Maker.
THINKPATH INC.
By: _____________________________________
Name: Declan French
Title: Chief Executive Officer
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