DCAP GROUP, INC.
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October 31, 2003
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Re: Guaranty of Obligations
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Dear ▇▇▇▇▇:
Reference is made to that certain Limited Guaranty of Payment
Agreement (the "Guaranty"), dated July 10, 2003, executed by you for the benefit
of Manufacturers and Traders Trust Company ("M&T"), whereby you have guaranteed
certain obligations (the "Obligations") of Payments Inc. ("Payments") to M&T.
Reference is also made to that certain $2,500,000 term life insurance
policy on your life , issued by Zurich Life Insurance Company of New York,
Policy No. TBA (the "Policy"), and owned by you.
In consideration of your execution and delivery of the Guaranty to M&T
and your agreement to the following terms, DCAP Group, Inc. (the "Company")
agrees to take the following actions for so long as the Guaranty remains in
effect: (i) reimburse you for all premiums paid on the Policy; and (ii)
compensate you at the rate of fifty-thousand dollars ($50,000) per annum.
In consideration of the foregoing, it is hereby agreed as follows:
(i) the initial beneficiary of the Policy shall be your wife, Lauren;
(ii) for so long as the Guaranty remains in effect, neither the owner
nor the beneficiary of the Policy may be changed without either the prior
written consent of the Company or the written agreement (in form and substance
satisfactory to the Company) of the new owner or the new beneficiary, as the
case may be, to abide by the provisions hereof;
(iii)in the event, at the time of your death, the Guaranty is still in
effect, in whole or in part, the proceeds of the Policy shall be used to satisfy
the Guaranty whether or not M&T accelerates the due date for the payment of the
Obligations; and
(iv) in the event that any of the Policy proceeds are used to satisfy
the Guaranty, in whole or in part, neither you nor your estate nor any
beneficiary of the Policy shall be entitled to be indemnified by, or otherwise
receive any amounts from, the Company in consideration of the
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October 31, 2003
Page 2
amounts so paid as a guarantor, and all indemnification and other rights of a
guarantor with respect to such Policy proceeds are hereby waived.
This letter agreement shall be construed in accordance with, and
governed by, the laws of the State of New York, excluding choice of law
principles thereof.
This letter agreement sets forth the entire understanding of the
parties with respect to the subject matter hereof and may be modified only by a
writing executed by the party sought to be charged.
This letter agreement constitutes the binding agreement of the parties
hereto with respect to the matters set forth herein and shall be binding upon
the successors, assigns, legal representatives and heirs of the parties hereto.
This letter agreement may be executed in one or more counterparts,
each of which shall be deemed an original, and all of which taken together shall
constitute one and the same instrument.
Signatures hereon which are transmitted via facsimile shall be deemed
original signatures.
Please indicate your agreement to the foregoing by signing in the
space provided below.
Sincerely,
DCAP GROUP, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Secretary
AGREED:
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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