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HomeMy WebLinkAbout00-01960 WILLIAM ALBERT WRAY, JR., and KAY G. WRAY, Plaintiffs IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA v. CIVIL ACTION - LAW WRAY'S MUSIC HOUSE, INC., WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, III,: Defendants NO. 00-1960 CIVIL TERM ORDER OF COURT AND NOW, this 14th day of December, 2001, after hearing, it is ordered and dir~cted that, pursuant to the sale and purchase of Plaintiffs' stock, the Defendant, Wray's Music House, Inc., has the obligation to provide health insurance for William Albert Wray, Jr., and Kay G. Wray. It is further ordered and directed that the individual Defendants have no such obligation. The insurance provided shall be comparable to the best health insurance plan provided for any of its employees. Should Plaintiffs elect a different health plan, Defendant shall reimburse ~hem monthly in an amount equal to the cost of the health insurance it would otherwise be obligated to provide. This obligation to be in effect during any period that Defendant provides health insurance for any of its employees while either William Albert Wray, Jr., or Kay G. Wrayare li ving . The Defendant is directed to reimburse Plaintiffs, in accordance with the terms of this order, for any unpaid health insurance premiums. ~~ t- t)& \rv- ~ Edward E. Guido, J. , ~ " -<.~~~,~"- , I' .--, f& ,," .. ~. ",. 'C" "'~)."I"J":l "I'"'' '-'\1'-.". ./ I \; '., \ f \..... ~ ,--i )J.~jnr)r) . \i\/'(f:~~T/\1118 G'l \r,__: ,.. .,..._.., t-... tl! j.:;U III '.',,-- ~ -".",." . < "'.'f_~ I~ ":"" I <~ - '" - ~. ."- ~1!W-M!lt!l"4Iil!m I,n'~,*illm ,~~Q! '.. R. Mark Thomas, Esquire ~Dl. - .:l../() () 101 South Market Street. 17V ~ Mechanicsburg, PA 17055 Attorney for Plaintiffs Thomas J. Weber, Esquire Goldberg, Katzman & Shipman, P.C. P.O. Box 1268 Harrisburg, PA 17108-1268 Attorney for Defendants srs ~ ~.',-J',""'" ~~"'-~,,-, -,- '_"i' _-c."", _~ , Plaintiffs IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA WILLIAM ALBERT WRAY, JR., and KAY G. WRAY, v. CIVIL ACTION - LAW WRAY'S MUSIC HOUSE, INC., WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, III, Defendants NO. 00.1960 JURY TRIAL DEMANDED DEFENDANTS' TRIAL BRIEF In September of 1997, Wray's Music House, Inc. was owned by Betsy DeStefano, a non-party to this litigation and the daughter of the business's founder, holding 10,513 shares (the number being the shares actually held and those to be received from her mother's estate); Plaintiff William Wray, the son of the founder, holding 10,503 shares (the number being the shares actually held and those to be received from his mother's estate) and Plaintiff Kay Wray, William Wray's spouse, holding 10 shares. Wray's Music House Inc. was established in 1955 and is primarily a retail establishment selling musical instruments, including guitars, key boards and sheet music. In addition to Wray's Music House, Inc., the above identified individuals were involved (and had been for an extended period of time) in other .business entities. These included Do Wray Mi Pianos, a partnership located down the street from Wray's Music House, Inc. This partnership was owned fifty percent (50%) by Betsy DeStefano and twenty-five percent (25%) each by William and Kay Wray. . , This entity sells and rents pianos and further, through a cooperative effort with Wrays Music House sold sheet music. In addition, the individuals held DWM Properties equally owned by Betsy Destefano, William Wray, and Kay Wray. This business owned the real estate at which Wrays Music House conducted business. At the time of the transfer of shares in Wrays Music House involved in this litigation, Wrays had a lease with DWM through the year 2008. William Wray and Betsy Destefano were also equal owners ofWrays Music House Partnership. This entity owned the real estate housing Do Wray Mi Pianos. In the beginning of 1995, due to his experience in the music industry, defendant William Selosky was hired as general manager of Wray's Music House, Inc. In May of 1995, the day after he graduated from college, Defendant F.J. DeStefano, grandson of the founder, began working in a full-time capacity as a salesman in the family business. Neither defendant held any ownership interest in Wrays Music House or any of the other Wray family businesses. Despite not having worked for the company on a consistent day to day basis since 1992, William Wray continued to receive salary. Kay Wray did serve in the capacity of bookkeeper. At the inception of their employment with Wrays Music House the defendants encountered serious operational and financial problems in the business. These included staffing issues, relational problems with vendors and extensive account payable problems. >,,0 "' y , ~. '.. , By the Spring of 1997, the fortunes ofWray's Music House, Inc. had not significantly improved. Although he was not actively participating in the operation of the business, it was felt that William Wray's interference as an owner and continuing receipt of a salary were contributing to the financial difficulties. By the summer of 1997, these difficulties included the fact that Wray's Music House was approximately a year behind in its rent payments and three months behind on vendor payments, a delinquency totaling approximately $365,000.00, as well as carrying significant other debt as a result of cash infusions needed to ke,ep the business afloat. Due to the bleak financial outlook, and their inability to control the operations, William Selosky and F.G. DeStefano began planning to open their own music business. At this time, Mr. Selosky and Mr. DeStefano were approached by the Plaintiffs with an offer to purchase their shares in Wray's Music House, Inc. The Plaintiffs were not divesting themselves from the other family related businesses. In other words, they would continue in their capacity as landlord to Wrays and owners of Do Wray Mi, the establishment with which Wrays enjoyed a cooperative arrangement. There were at least two negotiation sessions held regarding Plaintiffs interest in selling. In the first of these, held between William Wray, William Scl6sky, and F.J. DeSteFano, Mr. Wray represented to the Defendants that purchasing the interest in Wray's Music House was more advantageous than establishing their own business due to the fact that Wray's Music House was a going concern. In "~1l . . . I addition, Mr. Wray represented to the Defendants that he was not going to open a competing business, and therefore, the Defendants would have continued use of the sole legitimate asset held by the company, that being the Wray's name as it is associated with a music retail establishment. The second such period of negotiation, conducted between William and Kay Wray, and William Selosky and F.J. DeStefano, focused on Plaintiffs requirement that the Defendants would have to renegotiate the lease between Wray's Music House, Inc. and DWM Properties. At the time of the transfer of the sha:res, Wray's , Music House, Inc. was delinquent on its rent to DWM but was in possession of a fifteen (15) year lease running though the year 2008. Plaintiffs drafted numerous documents addressing some of the issues pertaining to the transfer, including the document that forms the basis of this Declaratory Judgement Action. Plaintiffs further represented to the Defendants that the transaction was amongst family and that there was no need to waste money on attorneys' fees having the documents reviewed or modified. Defendants relied upon Plaintiffs' representations and signed several documents pertaining to various issues associated with the transfer of shares. At the time of the transfer, in addition to William and Kay Wray, the only other shareholder in Wray's Music House, Inc. was Betsy DeStefano, hOlding fifty percent (50%) of the shares. Although she was generally aware ofMr. Selosky and Mr. DeStefano's efforts in acquiring interests in Wray's Music House, Inc., she was not involved in the negotiations or aware of the terms of the transaction. No .';1. . . I formal corporate action was taken with her involvement authorizing the sale or approving the terms ofthe sale. At issue in this litigation is a passage in the document created by Plaintiffs which purports to obligate the company to pay the Plaintiffs health insurance benefits for life. In addition to there being no corporate action taken to approve the obligation, neither individual defendant agreed to be personally responsible for the obligation. Following the transfer of Plaintiffs' shares, which took place approximately one month after the document attached to Plaintiffs complaint was signed, Defendants undertook the enormous tasks of correcting the financial problems of Wray's Music House. In doing so they discovered other financial problems heretofore undisclosed. These included paying the rent arrears in existence at the time of the transfer. Despite the fact that Plaintiff's request for renegotiation of the lease never made its way into any formal sales agreement or the document upon which the Plaintiffs premise this litigation, Defendants honored the verbal agreement and a replacement lease was negotiated in the Spring of 1999 increasing the rent obligations ofWray's Music House. During this time, William and Kay Wray maintained their ownership interest in Do Wray Mi Pianos and were maintained on that companies insurance rolls with the premiums rei'illbursed by Wrays Music House. Shortly after compelling the renegotiation of a 15 year lease midterm, Plaintiffs began a course of divesting themselves of their interests in the other ''1' ~_,_._ , I Wray family business. These efforts included selling the property housing Wrays Music House and assigning the recently entered lease with its higher rent. In August of 1999, William Wray called a special meeting of Do Wray Mi Pianos and informed Betsy DeStefano that he and his wife were dissolving the partnership and forcing his sister to buyout of their interest in Do Wray Mi Piano. After "cashing" out their interests in the family business entities, the Plaintiffs hired away from Do Wray Mi Pianos the manager that had been with them for eight years and opened a competing business operating under th<; name of Scott Wray Galleries located one and one half miles from Wray's Music House. This business opened in the fall of 1999. Upon William and Kay Wray's violation of their representation that they were not going to compete against the family business, the medical benefits previously provided by Do Re Mi Pianos were terminated giving rise to the current litigation. Despite owning and being employed in a competing business, Plaintiffs are asking this court to enforce what amounts to essentially a lifetime employee benefit. Lifetime contracts in the field of employment are particularly onerous and must be carefully construed. See generally. Greene v. Oliver Realty, 363 Pa. Super. 534,526 A.2d 1192 (1987); Riener v. Evans & Sutherland, 22 D.&c. 4th 321 (Bucks Co. 1994); and Herald v. Star Blends, 1991 U.S. Dist. LEXIS 14476 (E.D. Pa. 1991). ., ~ - - I In this case there has been no appropriate corporate action taken to accept the obligation. Further, the parties to the agreement did not agree to be personally obligated. In addition, there is a lack of adequate consideration for this onerous burden (particularly in relation to Kay Wray who held only 10 shares of stock) . Even had a legitimate obligation existed it terminated when Plaintiffs violated their representations to the purchasers and divested themselves from the family business and elected to compete against the company founded by their parents and in-laws. Should the court find an obligation to provide health insurance the document is silent as to the type. In this event, the Company would request a determination that the obligation can be fulfilled by providing any insurance available on the market. Defendants' respectfully request the opportunity to address any specific legal issues the court has following the bench trial through post trial briefs. Date: December 14,2001 Tho as J. Weber, Esq. Goldberg, Katzman & Shipman 320 Market Street Harrisburg, PA 17101 Attorneys for Defendants "M'~__~~~ ,"", "__ ~. ~_ WILLIAM ALBERT WRA Y, JR. and: KAY G. WRAY, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA Petitioners NO. 00-1960 CIVIL TERM v. WRA Y'S MUSIC HOUSE, INC. WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, III, Respondents PLAINTIFFS' TRIAL BRIEF FACTS William Wray, Jr. and Kay Wray are husband and wife. Nana Wray DeStefano is William Wray, Jr.'s sister. These three (3) persons were the sole owners of Wray's Music House, Inc. and were the sole partners in the partnership known as Do Wray Mi Piano Rentals. Wray's Music House, Inc. (WMH, Inc.) is a retail business which sells a broad range of musical instruments. Do Wray Mi Piano Rentals was mainly limited to the sale and lease of pianos. Both businesses were located on Market Street in the Borough of Lemoyne. Due to an inability to work together, as well as William Wray, Jr.'s growmg dissatisfaction in WMH, Inc., he ceased being involved in the day to day operations of WMH, Inc. sometime around 1992. William Wray, Jr. continued to work at Do Wray Mi Piano Rentals, but only on a limited basis. Kay Wray continued to work fulltime and was the main bookkeeper for WMH, Inc. and Do Wray Mi Piano Rentals. Defendant William Selosky took over the day to day operations of WMH, Inc. and eventually received title as president and general manager ofWMH, Inc. FJ. DeStefano, Nana Wray DeStefano's son, was employed at WMH, Inc. as vice-president and assistant manager. In July 1997 William Wray, Jr., Kay Wray, Nana Wray DeStefano and FJ. DeStefano met; at --"~1, ,. >= ~~-~ , which meeting William Wray, JL and Kay Wray offered to sell all of their shares in WMH, Inc. to Nana Wray DeStefano and FJ. DeStefano. In the alternative, a proposal was made whereby William Selosky and FJ. DeStefano could purchase these shares. , On August 20, 1997, William Selosky and FJ. DeStefano advised the Wrays that they wanted to purchase all of their shares in WMH, Inc. On September 19, 1997 the Agreement which is the subject of this litigation was signed. William Wray, Jr. and Kay Wray continued to work for the Do Wray Mi partnership which was in the business of selling and leasing pianos. In May 1999 William Wray, Jr. and Kay Wray made an offer to Nana Wray DeStefano to purchase her partnership interest in Do Wray Mi Pianos. Nana Wray DeStefano did not accept the offer, but in June 1999 she made a counter offer to purchase William and Kay Wray's partnership interest in Do Wray Mi Pianos. William and Kay Wray entered into an agreement with Nana Wray DeStefano for the sale of their partnership interests in Do Wray Mi Pianos. The Partnership Withdrawal Agreement was executed on August 31, 1999, and closed in February 2000. Between June 1999, when negotiations on the Partnership Withdrawal Agreement commenced, and February 2000, when closing on the Partnership Withdrawal Agreement was held, Nana Wray DeStefano had actual knowledge that William Wray, Jr. was going to open a retail business selling pianos. Despite this knowledge on the part of Nan a Wray DeStefano there were no discussions and/or negotiations concerning a non-compete clause in the Agreement. In October 1999 "Scott Wray Piano Gallery" a partnership with William Wray, Jr., Kay Wray and Scott Richardson as partners opened in New Cumberland. WMH,Inc. continued to pay the premiums for William and Kay Wray's health insurance through December 1999. In January ',l'~.,_, ~-~'"-"'" "~c~ and February 2000 WMH,Inc. did not make health insurance premium payments and in March 2000 WMH,Inc. notified the Wrays that they would no longer pay these premiums. William Wray, Jr. and Kay Wray have brought this Declaratory Judgment action to have the court determine their right to have WMH, Inc. continue to pay their health insurance premiums under the Agreement dated September 19, 1997. ISSUE #1 IS WRA Y'S MUSIC HOUSE, INC. BOUND BY TERMS OF THE SEPTEMBER 19, 1997 AGREEMENT. A corporation is a legal fiction which can act only through its officers, directors and other agents. Daniel Adams Associates. Inc. v. Rimbach Pub.. Inc., 519 A.2d 997, 360 Pa.Super. 72 (1987). Corporation is bound by its agent's acts if those acts were performed within implied or apparent scope of agent's authority, unless agent acted for his own benefit without corporation's ratification of his actions. National Risk Management. Inc. v. Bramwell. 819 F. Supp. 417 (E.D. Pa. 1993). In the instant case, although Selosky and FJ. were not shareholders on the date the Agreement was signed, Selosky was the president and general manager ofWMH, Inc. while FJ. was the vice-president and assistant manager, as well as the son of the sole shareholder who was not a named party to this Agreement. At the very least, William and Kay Wray reasonably ., ~ - -~< - ~~-~ believed that Selosky and FJ. had the apparent authority to bind WMH, Inc. to the terms of this sale. "Apparent authority is such authority as a reasonably prudent man using diligence and discretion in view of the principal's conduct, would naturally suppose the agent to possess." Pollock Industries. Inc. v. General Steel Cast COI:p.. 201 A.2d 606,611 (Pa.Super. 1964) This reasonable belief that Selosky and FJ. had the authority to bind WMH, Inc. to the terms of the contract is supported by the fact that the sole remaining shareholder, Nana Wray DeStefano, had full knowledge of the ongoing negotiations, that her son was a party to the contract, and that under the terms of the sale there were several issues affecting WMH, Inc. directly and indirectly. For example, there was a corporate debt in the amount of $37,870.59 to be paid to the Wrays which was part of the consideration. There was the need to enter into lease agreements between WMH, Inc. and DWM Properties, a real estate partnership with William Wray, Jr., Kay Wray and Nana Wray DeStefano as partners. DWM Properties owned the premises where WMH, Inc. would conduct its business and the financing bank demanded a current lease arrangement to ensure that WMH,Inc:would continue to do business at the same location. Because of her status as a shareholder in WMH,Inc. and her status as a partner in DWM Properties, Nana Wray DeStefano would have been intimately aware of the negotiations and agreements which were intending to bind both of those entities. This Agreement was not reached in secrecy and Nana Wray DeStefano had either actual or constructive knowledge of both the content of the negotiations and the terms of the final Agreement. She never expressed opposition to any of the terms of this Agreement. Therefore William Wray, Jr. and Kay Wray , -~' -"' . reasonably believed that Selosky and F.1. had apparent authority to bind WMH, Inc. to the terms of the Agreement. Even assuming that Selosky and F.1. did not have the authority to bind WMH, Inc., it is clear that WMH, Inc. subsequently ratified the actions of Selosky and F.1. as well as the terms of the Agreement. "After an act of a corporate official who has or is in apparent authority, has or should have become known, failure to promptly disavow or repudiate such action raises a presumption of ... affirmance and ratification." Rectnor & Kline. Inc. v. Department of Highways. 413 Pa. 119, 196 A.2d 355,358 (1964), as more recently cited in Kann v. Keystone Resources. Inc.. 575 F. Supp. 1084 (W.D. Pa. 1983). Since WMH, Inc. is a closely held corporation, where shareholders personally conducted and directed business, the actions of the shareholders need not be proven by board minutes. Kann. at 1091-1092. Therefore, there is no need for a formal ratification of the Agreement to be recorded in the corporation's minutes. In fact, Wlauthorized acts may be ratified by passive acquiescence. Id, at 1092, citing Collins v. Parkton CompoWld Boiler Company. 195 Pa.Super. 364, 171 A.2d 576 (1961). Considering that WMH, Inc. paid health insurance premiums for twenty-six (26) months following the sale it is clear that Nana Wray DeStefano had actual and/or constructive knowledge that WMH, Inc. was paying these premiums and thus ratified all terms of the Agreement dated September 19, 1997. 1'- - ISSUE #2 IS PAROL EVIDENCE ADMISSIBLE TO PROVE A PROMISE NOT IN WRITTEN CONTRACT. General rule is that "parol evidence of a contemporaneous oral agreement is not admissible to alter, vary, add to , modifY, or contradict a written instrument complete within itself unless the oral agreement was omitted through fraud, accident or mistake." Gemini Equipment v. Pennsy Sup'ply: 595 A.2d 1211, 1215 CPa. Super. 1991). This is even more so the rule when the alleged contemporaneous oral agreement, if made, "would naturally and normally have been contained in the written agreement between the parties." ld. at 1215. Finally, "Where parties, without any fraud or mistake, have deliberately put their engagements in writing, the law declares the writing to be not only the best, but the only evidence of their agreement." Shewak Distributor v. Keystone Brewing. 704 A.2d 1108, III CPa. Super. 1998), quoting from Keyser v. Margolis. 422 Pa. 553, 559, 223 A.2d 13, 17 (1966). In the instant case we have an executed written instrument, i.e. the contract dated September 17, 1997, which appears to be complete in itself. Also, considering the nature of this transaction, which is the sale of a somewhat specialized retail business, a non-compete promise made by the seller would naturally and normally have been contained within the written agreement. Therefore, the only admissible evidence of the terms of the Agreement is the writing signed by all parties on September 17, 1997. Although there is no integration clause "its absence does not automatically subject the written agreement to parol evidence." Kehr Packages. Inc. v. Fidelity Bank. 710 A.2d 1169, ~- -, 1173 (Pa.Super 1998). In the absence of an integration clause the court is to examine the writing itselfto determine its completeness. Id., at 1173. Even if the court should find that there was an oral contemporaneous agreement made by William Wray, Jr. that he would not compete with WMH, Inc., such an agreement, to be enforceable, must be reasonably limited as to duration of time and geographical extent. Piercing Pagoda. Inc. v.Hoffner, 465 Pa. 500, 351 A.2d 207 (1976). It was more than two (2) years following the sale of September 19, 1997, before William Wray, Jr. opened a business known as "Scott Wray Piano Gallery." If the court were to impose a reasonable duration of time, in light of the failure of the alleged Agreement to state a duration of time, two(2) years would be reasonable. Respectfully submitted, R. Mark Thomas, Esq. -~ "/e3/,~~~ ,2,e~ , n 7731.eS68 WRAVS MUSIC PAGE 03 " !r.HI!'~t:.l~,,_~pr,thla:!IQb.r !'.JllIl1, W;UJ.!lI!l""A~!tf~.tt;ftVt .:t"..,wiU t"" ~wn . J:'QI11 1i . 1l"'!!II'.. ...~ b..l't~flOll'[!lI ~""'''''' ... "lit: "!'I..IIIl, _ .tfl(~,: lUlU Kay ~.. ,10111'.1 w1H l!:'liI.'"n .. .ea... '''If ".....IAIr.iI' o' WhAY'S MUlli~ 1I0US/IJl, INC. The /1;mplorment dlllcount will c;oolll:!nutI to be !11ven to w HUam Abert Wroy, Jr and RIIY G. Wray. . f!. J. whol~sale Club I"ember.hip will conl:J.nue to b. paid for. willi"," 1\.tberl: Wray, Jr. and key G. wrllY, utile." lIot..! fled otherwise by \o/111iam Albert: WrllY, "II'. llnd Kay C. wr.oy. .' w" thl! IJndel:'l'IJqned l1g'rec that: H. is wit:h Bound mind end wll;llOul: Ill"n!:o,!. durel''' t.hol: we an' agree!no 1:0 the above I:~tffl_ olld conditions. ~J; ~ (i[ . '. ~'.L. _ ._ t:1l .11.<\1" Ii:. SeIosK " September G, 1991 ~ in ~ III : j'i'rijTIF.-~in5fj;' e. ~iiiio, 111 September 6, 1991 ., September 6, 1997 .. ~J.0'tAll'~. Kay tt:l wrBY September 6, 1991 DEFENDANT'S ~ EXHIBIT II .i. I I Bill Wray J,JPP\"S ,'lU:';lC HOLlSE, IHC, .ro BO:'; 419 3:26 l'lF1PKET ~:'T LE}10V111:: , (? 17) '-(,E, 1 -~822~~ Scott Wray Piano Gallery 440 Bridge Street P.O. Box. 444 New Cumberland, PA 17070 717.909.9009 loll free 877.999.9558 fax 717.909.9191 mobile 717.608.1400 home 717.697.9729 scottwray@paonline.com www.scottwray.com IA181.n I T\' F"" '1-'o.4"'-..F141 9. H '." _.. _,I, ," [:oE,SCF;IPTIOH, ......_..~ -~' ..'.......- :-.-. ,-'.-..- ~ ._.;..,- 'O-~. -, ----.::....-. _'~._. ._'_,_i:. ';"'_.~__ ...n_"._ _..,___ .1 Pi'lOUHT 1 2:,?f:::t::. GTI';< 5 EU::CIRIC Fti,lDEP 50 s~::- ria 1 '-'1Uf!'lbE' i- : ;:79~99 VBF.:[.' ;:r. Sl:::,t-i~l :l '::~ 1';.16. 5'/tnH '/RI'18Hf1 t,h..'ri'jb~'r~ : . o,q). tit t~ :~~69 ~ 95 51Jr,:c1 CITnL. TH~':;' TOTrlL CU<.:T # 1'1f'6Tn:( CliF:D ':Hr:rHGE JEFF KU,tltF: 20.:- l,J GF,:[lJl ST Cm'lp. HIU.; Inl.)oi.o? t:lumt't?l" : J.~3H51.t 1 ~~>"13/E1 J :5: 05 Pt'l Th.s;ni 'Y'U. Pp..l?OJ 1 t.;;--~. .'." ,", , . r~FtjFR-r(:. . m[, , {j)ln~;149"?Ci j I~KI" (~~3 .1'79" 99 . PSP-2r,::2, iO,. fl::' 1?0.iC)0 nr:j4f;~':.:~,t=, l\6 : ~'-. 1 ~J'~ ~. '~:l~ 8.Mclflf I , ~ ~ " - -. f'- ._r ~579 . ~~4 " :::-:(:1 40~:. 74 2::::9::::(' I I Wfll'J MuSIC House HIstory ':,.~~ <:<"'':::~. ." '. ..:~.,-~~'- . =r., .....1:.'. "._'-~~... ~.. ...P.."''''.._"....J....._.J:=b -. -.--...:f.::..-...:l.;,l;.:i'fl ':,- - "", ~~:.' " -,~~-?i:?=~~:.::'::.:J:;..E~:.',w~;;'~,;F~:.=~_.~;~~~::;~;:,~:;;:;r:.. .. ..... ...-' '\.~,. WDy ~c~. . (WMH) is celebrating onr 44th year in fmsin~Jtan{' d back in 1955 when WilliamA. Wray, Sr. . .... ..., '.... st, . after consistently being top salesman month a:i't€'f".'. · aJimltel- store in town. He achieved this success by !,I; ;!";ic" semnl." iaiios "door to door" mainly to farmers and rural hons ~ .'lIds III 'tJ/'e Harrisbnrg, Pa. area. In the 1960's he expanded into l/.' . I-line ll;ore by offering guitars and amps, and in 1974 the busipesslncorporated. Also at that time Do Wray Mi Pianos, a division ofWMH, was formed to service the expanding acoustic a~.electric piano sales in the area. Mr. Wray passed away in 1~. In 1992 Wray Music Hopse relocated a few doors down the street while Do Wray Mi Pio1JWs remained at the original location. Page 1 ot 1 Today, Wray's Music House is owned by William Stlosky, F.J. DeStefano, and Betsy Wray. All of the day to day business is handled by William Selosky and F.J. DeStefano. Our Store Manager is Michael Mutzabaugh, assisted by Johnathan Shuey. We also have 10 full time employees specializing in their perspective fields of expertise. Wray's Music is a full-line music store stocking everything except band instruments. Almost every brand name of musical gear is represented. A few of our lines are Gibson, PRS, Ovation, and other popular American Brands, Mesa-Boogie, Takamine, Ensoniq, Roland, Mackie, Crest, Ashly, Alesis, Tascam, Shure, Premier, Sabian, and Zildjian. We take pride in offering professional and courteous service to all musicians of any level. We also have the best prices in town. So, as you shop the web, give us the opportunity to earn your trust and be your full-line music store for all of your musical needs!!! Thank yon for the opportunity to serve you, our loyal customers! ~ Home I. DEFENDANT'S I,EXHlB\T.. ~.. c'." .L. Scott Wray Piano Gallery Bill Wray, Sf. Scott Wray Piano Gallery History Bill Wray's father, Bill Wray, Sr., founded Wray Music House in 1955 after consistently being top salesman month after month for another piano store in town. He achieved this success by selling upright pianos "door to door" mainly to farmers and rural households in the Harrisburg, Pa. area. In 1969, 14 year old Bill, Jr. started helping his dad everyday after school. After graduating from Susquehanna University in 1975, Bill, Jr. began working full-time managing the full line music store and the acoustic piano division. In 1991 Robert Scott came on board working first at the full line music store as a salesman. A year later he became the manager ofthe piano division. Robert's love and passion for the piano was rewarded in 1998 when Yamaha Corp. designated him as a Yamaha Touchtone Salesman, a honor limited to a select group of piano specialists. . . Robert Scott and Bill Wray teamed together and formed Scott Wray Piano Gallery in 1999. They wanted to provide the area with a large facility to be used in showcasing new and used pianos, keyboards and organs, and an area for piano and organ recitals and concerts. Plans are to build private and group teaching studios. Their 5800 square foot building made them the largest piano and organ show room in the Harrisburg metropolitan area. Page 1 of 1 I !iQlll~ I PrDd\l.\'t~ 11i,,~dJ).ianQ..1 pial1QB.")l.t.~l> I Qg..e Olrt~ I Lessons I Buy Back Options I Contact Us I Sell Your Piano I ""iim _ .. 0__ ~~~" -. - _ ~_'='T""''''' . .-~".;,;.~;.!.~d..-~~Iung w: ~avel. V'ilU pe,UUlIIg ........~ r-J . ~. ,-- - .--. _..:j',f;covers Wl~.o:ngmals._Influenced by - ~ ;~. "f '![Kix. Paison.. Crue etc.' Please show ..' .,.0'sour inte~st.by sending a pic/ bioi :},i:_~petoBNP':POBox. 7413. York,PA ._ ,~>:';}17404,-0413 oJ;' email: . "':;:~~rkslarrill1@hotmail.com ,,,,~-;~~?',;-;';".- '".- .' '. -:' <~WAr(tED: Drumme~toforin'blues .' ~~ ': g.;band:~lso lookingJor people,to do' cW~TED:_ Keyboard .player ~ith --~,_:::"':'~~l!Ld.e_Jl!3i~~,:_,_BI~ck.,.)Vhite.-'green-;-:.' . yqcal ability and sequencer for new .color don'Cmatter. Side;projectin~; ': cover ba~d. Songs include modem dustrlaltrap {metal. Either one. call, ;,' rol:k-'and rap. inust have sequencer. Kelly. 717-258-:0455. Call Tony 117-238-1965 or Michael \c"., .', .,' " "717'362.6418. WANTED: Frontman seeks musi- c' s to form tribute to Poison. Nlust WANTED: Working band seeks Lead rJve look J1afent and willing to Guitarisl.plusdrurrunertogobackout . ~ is a Show people -will and work. StateCoUc;gelAltoona area. osee! 717-870-2947. 70'S/80's rock, no pop crap, very hard .. rock. 814-355,.4315. -' D: Reav nnsiian~'b8nd'" ,. f," f. see vocilist; g~t8tist ~d ke~: -J' WANTED: M,us}cians to form an board:;. Ldokihif6t'aOOi~~a1€d in'll}' l;. Pc()~ginal bard fOCK band. I am a lead sidans whOlovB~1IihFhNOtchlWcf-; 1lr~itar player looking;tQ pu~ ~~ether Ire -'">~'I<;"'~ '':''r"''.-'.' ." CD and play gigs. Calf Bob 717. ex me Ulw>le'. rOCOS'on i"~:st: iUlU J minislt)';trtlY1i1'225;5t~'!li.S\f."'30t;:li193. . . ~ ., . ',"_ t"('p' _;'_'\'_1' " -.-__..,;:: ',", annon717~,32'!-SSoe." -\.,-'-" ,.~""-_ '_l~.'- ." . '\,>"_,,~,,M WANTED: Guitar player with vocal ability for new cover band. Songs in- clude, modern rock, rap 70's/SO's. must too .50-60 songs ASAP. Call Tony 717-238-1965. Michael 717- 362.6418. ~ --.!.L Ni!!,'", ~~ ..._~ ~.~_ 'c,,"'-:.?'l''''- 'fr;;"<; ',,; i.. ... ,_ ' '" ~ ~ t ~ ~tt1 <.: "-"-""<-'-. ., ~,,; , i.',-/ t ~ [ 1. ...~_v, . ~_., _._. __'. '"~_.. _. . _. 939.1404. WANTED: CountrY-band in Wyo- ming Valley area fQ~ recording origi- nal'Songs for demQs. Intend to record 20 or more, weekends mostly. Need drums, guitarS (acoustic/electric, bass, lead rhythm) steel, guitar, keyboards. (Fiddle, mandolin, dobra, harmonica a plus). Good pay but must provide instluments. Call Rob 570-779-9334. SIC roCK O~IlU. vvallllllg.H~.P\{l)'. - twice-a month. Please call. 7f~;' 4305 or 717~72S-4293. _ ..; .Qt WANTED: Singer for York ba metal band Substance. Mostly..or nals with some covers. Influen~"'" elude overkill, Slayer, pant~.;'-. ~. Factory. Contact Todd 717-767;. I Dave 717-332-4640 or Jirimiy.~ 852.7638. COREY ESLINGER LIGHTING Professional Entertainment Lighting at Affordable Rates -SatWactidh Guaranteed- . .717~697~7496 pager # 230r7874 ";;-,-, ....'. " ." , , - ~ ',.-,~ :;:. ;i,' _______._._....____ "--._~.-~---4,~------ \'-'~~.;', " ~ '" ~ "".j ~t ~ -', "-~-i "Jriif/'-', \,,-,-' h,;;.- .'-.-~, , ,^' ~: .,_ ...~_.t., ,.~ r:; \~.~\~ W!ill; _ ;~,~:.:J ~L-.~ \.,\~i\t\\\d\'WW...:;- ;>:.',f; ~ L~;;\". . \. ""\ 11'1"';',' : : ~. ~,~~.. .~\ /'\ I~';" 1~~..1 ":;,l,t),'.l./l.... :.' ,. , \. ',:'. - . i.1 ;$' " , . './ li " ~ "',,, ~ t"Ji" "....~ ,(:ii {,' ":;. T~. .R... t. :rrAk~f;C _i' 'n ',---,-I~ O-I~' :<,"," MUjlC WORKSTATION/SAMPLER AU8BUOBB3Plaversl ~~iBtocom8...... -1118'.013 .~- -, . 1.~'1.'1..."..'. ..11..... ..1... ..11 98.. .... .....0..-.11. - . - ' , > ,', - ,- ,,', , - "'~;,' :,1 ,.; ;:: n': 'j' ~ ~ J. '_~ . ........ ....._. :.:.. ...\. ;.........i;... _... ... ;... .~... .... .i. ...... ":' .~., .;:-'.' - ~"... '.".'. .. ,', ..' --' - : ---:::m!ll ~.~ ~":"~ ----:, '-.' " ray scottwray.com 440 Bridge St, New Cumberland Octo!!lit'~2000 :: .. .~ ..- 8tN";$at"'T 717,..73< MOn-f'ri 11am. ... -." -'" THE PEIIINSvliVANlA'MlJSrGIAN-' - ~~I- ,.~.'" .~~ >." -. ,.-~ - ~--- . ("""" . , ~ ~. ....~ ~ r.: ;: '. '''1'.'.''.' ..,""." ~~\:. ~..- ." " 11." ~ 7.1 ~~ .:' ~\ ~ 1 ::i ~ ~.i ~ I~:'-~ +" lIn :;~;J .,.~ @ @ Capital BlueCross Pennsylvania BlueShield Independent Licensees of the Blue Cross and Blue Shield Association Comprehensive Major Medical Cl15t9m13111~ PremierBlue~, Contract For Community-Rated Groups High Option Important Notice: This contract is for comprehensive major medical benefits. It includes a $250 deductible for services rendered by non-participating facility providers 3I!d non-preferred professional providers; 20% coinsurance for most services rendered by non-preferred professional providers; 50% coinsurance for services rendered by certain non- participating facility providers and for outpatient psychiatric services rendered by non-participating facility providers or non- preferred professional providers; $3,000 out- of-pocket limit Benefits are subject to strict precertification procedures, and pena1ties or loss of benefits may occur for failure to follow these requirements. This contract requires subscnbers to use certain designated providers to receive benefits or avoid financial pena1ties. Examine your contract carefully. Form F-1035a (0312000) 'l. ARTICLE II - SCHEDULE OF ELIGIBILITY A. ELIGIBLE PERSON Eligible Person is defined as: 1, An eligible employee or member who works a minimum of twenty (20) hours per week, receives a regular wage and meets any eligibility requirements for enrollment established by the Group. 2. An eligible Dependent as defined in Article I of this Contract. 3. An eligible retiree who is in a nonactive work status and who qualifies for retiree health insurance benefits under the Group's retirement benefit plan. 4. The Group may not discriminate in enrollment or contribution based on the health status, as defined in HIPAA, of an Eligible' Person. If the Group does discriminate in enrollment or contribution based on health status, the Group shall be solely liable for any claims or expenses, including medical claims or expenses, incurred by the Eligible Person who has been discriminated against. B. GROUP ELIGIBILITY 1. For Groups with ten (10) or more eligible employees, no contract will be issued or renewed unless seventy-five (75%) percent of the eligible employees are Subscribers. For purposes of determining a Group's compliance with this requirement, a "Subscriber" shall include fOI purposes of this section only, those eligible employees who are enrollee for coverage with Keystone Health Plan Central. 2. For Groups with Jess than ten (10) employees, the following minimurr participation requirements shall apply: Number of Eligible EmDlovees 2 3 4 5 6 7 8 9 Required Enrollment to Obtain 01' Renew Contract 2 3 3 ~. 4 5 6 6 7 Form F-1035a 13 @'","'- ~ ,{ 3 A ... ^........ .., o :"'~\'O~ This is a sales agreement that will be legally binding in a court of law for the bUf out of WRAY'S MUSIC HOUSE, INC. shares of stock from Will~am Albert Wray, Jr., and Kay G. Wray including shares to be inherited from the Nana E. Wray estate. William R. Selosky and Frank Joseph DeStefano, III agree to purchase all shares of WRAY'S MUSIC HOUSE, INC. from William Albert Wray, Jr. and Kay G. Wray including inherited stock from the Nana E. Wray estate at the asking price of $100,000.00. This is contingent on obtaining the financing from an outside source. The followin9 issues are also to be dealt with in the manner in wh~ch they are described below: I. The Corporate debt that is due to William Albert Wray, Jr. and Kay G. Wray for the use of their home equity line of credit by WRAY'S MUSIC HOUSE INC., in the amount of $37,870.59 will be paid in full at the time of the buyout of their shares of stock. A loan for the repaying the Corporate Notes that are due to their children, William Albert Wray, III and Jessica Leigh Wray, each in the amount of $40,000.00 (total of $80,000.00) will be secured when the loan for the buyout of the shares is repaid to the institution that financed the loan to William R. Selosky and Frank Joseph DeStefano, III, and also the loan that was obtained by WRAY'S MUSIC HOUSE, INC. to repay William Albert wraf, Jr. and Kay G. Wray for the use of their home equity l~ne .of credit. At that time it is the intention that all the Corporate Notes that are dUe to Pamela Wray DeStefano, Frank Joseph. DeStefano, William Matthew DeStefano, and Nana Wray DeStefano will be ~aid. until this loan is secured interest will cont~nue to paid at an annual percentage rate of 8%. II. Health Insurance will be paid in full by WRAY'S MUSIC HOUSE, INC. for William Albert Wray, Jr. and Kay G. Wray for the rest of their lives. This coverage will also include their children, William Albert Wray, III and Jessica Leigh Wray under the following conditions: a. They go through 4 consecutive years in undergraduate studies b. They go through an additional 4 consecutive years post-graduate studies immediately following undergraduate studies c. Coverage will cease upon marriage in either Ita or lib III. Starting September 8, 1997, Kay G. Wray will be withdrawn from receiving salary payments and will be paid by the hour during this transition time. Hours will be determined by William R. Selosky and Frank Joseph DeStefano. Hourly rate will be determined by dividing her salary by the hours that she worked ($850.00 - 66 hrs = $12.88 per hour). William Albert Wray, Jr., will stop receiving any and all salary from WRAY'S MUSIC HOUSE, INC. effective the date the check for the buy-out is received by William A. Wray, Jr. ",,-- .' rJl u-t- ~iii ""- lz:c 3~ ~ D.. EXHIBIT "A" -'.- l' . . ~ This is a sales agreement that will be legally binding in a court of law for the bUf out of WRAY'S MUSIC HOUSE, INC. shares of stock from Wil11am Albert Wray, Jr., and Kay G. Wray including shares to be inherited from the Nana E. Wray estate. William R. Selosky and Frank Joseph DeStefano, III agree to purchase all shares of WRAY'S MUSIC HOUSE, INC. from William Albert Wray, Jr. and Kay G. wray including inhe~ited stock from the Nana E. Wray estate at the asking price of $100,000;00. This is contingent on obtaining the financing from an outside source. I~ .W . "-- ~ - We the undersigned agree that without mental duress that we terms and conditions. it is with sound mind and are agreeing to the above ~. . ..~\ am. os y September 19, 1997 III September 19, 1997 September 19, 1997 W1 \4Jth )l'''[(L~ Kay G Wray ) september 19, 1997 -, ,~ " -1 i 1 i j J I ~ 'l,ll BUY OUT OF WRAY MUSIC HOUSE, INe. INTEREST AND SHARES , FROMW.A. WRAY, JR. AND KAYO. WRAY 1. STOCK PURCHASE: $100,000 A Purchased by Betsy and F J. Belsy and F. L would then have 100% ownership and control of Wray's Music House, Inc. B. Purchased by F. 1. and Bill Selosky Belsy WOltld then have 50% owuership F. 1. ,md Bill Selosky would each have 25% ownership Betsy and FJ. would have relain a majorily ownership and control of WMH ( 75% combined ownership and control) C. Paymenl in fllIl wonld be at time of buy-onl. II. CORPORATE NOTES: $120,000. A. Corporate notes due to W.A. Wray, III ($40,000.00) J. L. Wray ($40,000.00) WA Wray, Jr ($40,000.00) Will be paid to them in full at time of buy-out m LEASES A A fair market value lease will be drawn up between DWM Properties and WMH. B. A fair market value lease will be drawn up between WMH Partnership and WMH Sheet Music Department IV. LIFE TIME HEALTH INSURANCE A. W.A. and K.G. Wray, Jr will remain on the health care policy for the rest of Il'eir lives. W.A and 1. L. Wray will be covered until out of collcge. V. HOURLYRATE A Kay will remain through the transition ,or as long as WMHBoard desireS, at an hourly rate to be determined at time of buy out. VI. TIME FRAME A. This bny out offer will expire 9/30/97. Upon acceptance and completion of this proposal Bill and Kay would no longer have any shareS or interest in the business. Nor would they be part of the daily or overall business decisions. It wonld be advantageous for WMH if they would offer Kay's position to Kristy. She would be more than capable of handling tIris posilion and wouLd be a great asset to Wl\ffi 6/2 7/97 -In PLAINTIFPS EXHIBIT <tt;} ~~ . I. THE 40K OWED TO BILL AND KAY: To be paid in full at the time of the huy-out, OR To the pilid mlck before they make settlement on their house, which ever comes first. Financing will have to be secured by other sources if not included iu with the buy-out figure. II. THE 40K EACH DUE TO BILL III AND JESSICA: If this can not be paid back at the time of the buy-out, then it must be paid in f11ll within two years of the buy-out or when the Corporation has to re-negotiate the loan that is due to the bauk in July, 1998, which ever comes first. If repayment of Corporate loans must be prioritized, then Bill and Jessica will be the.first of the Corporate Principals to be pllid back in full. ~ I Ill. LEASES: DWM Partnership WMH is behind 8 months (February, .1997 - September 30, 1997) in.rent = $28K If WMH can start to repay back rent (in addition to current monthly rent) in the amount of $1000.00 per month, the will be current in 2 years and 4 months. At this time the new lease will be. in elIec!. WMB Partnership Sheet Music (WMH) lease IV. HOURLYRATE Kay will help with year end close-out and any transiliollnecessary at$ la,~[l per 1',<;(:>" (~1." hour. - l\)O I !,o\( Ilc d IIQI .jMJ ~~. - ~~ ~ '''v4J (IU{ ~F ~ ~',(I... r \JOLtJl.~~ '~ ~ r- . '"'" ".'.,"" - ~-'- ~~ LETTER OF INTENT TO PROCEED WITH BUY OUT OF WRAY MUSIC HOUSE, INC. SHARES OF STOCK FROM W.A.WRAY,JR. AND KAY G. WRAY INCLUDING INHERITED SHARES FROM NANA E. WRAY. WILLIAM R. SELOSKY AND F.J. DESTEFANO AGREE TO PURCHASE ALL SHARES OF WRAY MUSIC HOUSE, INC. STOCK FROM W.A. WRAY, JR. ,AND KAY G. WRAY INCLUDING INHERITED STOCK FROM NANA E. WRAY AT THE ASKING PRICE OF $100,000.00 CONTINGENT ON NEGOTIATION OF REPAYMENT OF CORPORATE NOTES DUE TO W.A.WRAY III, J.L. WRAY, AND W.A. WRAY, JR. AND ALSO CONTINGENT ON OBTAINING THE FINANCING FROM AN OUTSIDE SOURCE FOR THE PURCHASE OF STOCK FROM W.A.WRAY,JR. AND KAY G. WRAY INCLUDING INHERITED STOCK FROM NANA E. WRAY. WE ARE ALSO BEING REQUIRED BY THE LENDER TO HAVE A LEGAL SALES AGREEMENT IN PLACE WITH LEASES, AND ALL OTHER ASPECTS OF TRANSITION AGREED UPON AND IN LEGAL WRITING. WE ARE PREPARED TO MEET AS SOON AS POSSIBLE TO NEGOTIATE REPAYMENT OF CORPORATE NOTES, LEASES, AND TO JOINTLY COME TO AN AGREEABLE SALES AGREEMENT TO PRESENT TO OUR LENDER TO CLOSE THE DEAL AND FINALIZE THE BUY OUT. ()):ff/ Y-Z0"17 8-20-97 WILLIAM'R. :fvf)~J) -J 1/ 8~ :ZOr 9 7 F.J. 8-20-97 a-Jo-97 y;.J , / - # Y\\ A.OLt.J-- R~~ BY KAY G. WRA~ a-db- 97 PLAINTIFF'S EXHIBIT # 3 , -- Wray's Music House, Inc. 3-15-00 Bill and Kay Wray, As'~er our letter sent to you from our lawyer, enclosed is the final payments for your health insurance. This will cover January, February, and March of 2000. please be aware that the B.J. Wholesale Club membership has also been canceled. fJi;6 ~lJ w ~ PLAINTIFPS . EXHIBIT .;.~ .:IF '-I ''f_,_ "~ , - - CAPITAL BLUE CROSS COVERAGE: (pAID BY DO WRAY MI, REIMBURSED BY WRA Y'S MUSIC HOUSE) For 1/1-2/1/99 is: Betsy Bill Kay TOTAL DUE: $ 172.70 191.95 191.95 $ 556.60 For 211-3/1/99 is: Betsy Bill Kay TOTAL DUE: $ 172.70 191.95 191.95 $ 556.60 For 3/1-4/1/99 is: Betsy Bill Kay TOTAL DUE: $ 172.70 191.95 191.95 $ 556.60 For 4/1-5/1/99 is: Betsy Bill Kay TOTAL DUE: $ 172.70 191.95 191.95 $ 556.60 For 5/1-6/1/99 is: Betsy Bill Kay TOTAL DUE: $ 172.70 191.95 191.95 $ 556.60 For 6/1-7/1199 is: Betsy Bill Kay TOTAL DUE: $ 172.70 191.95 191.95 $ 556.60 For 7/1-8/1199 is: Betsy Bill Kay TOTAL DUE: . $ 172.70 191.95 191.95 $ 556.60 " ~ _of. -',-"-, For 8/1-9/1199 is: Betsy Bill Kay TOTAL DUE: $ 172.70 191.95 191.95 $ 556.60 For 9/1-10/1199 is: Betsy Bill Kay TOTAL DUE: $ 172.70 191.95 191.95 $ 556.60 PLAINTIFPS EXHIBIT #s -- --------- -----, 02/2a/2001 15:44 17177310558 WRAYS MUSIC PAGE 01 BUT OUT OF WRAY MUSIC HOUSE,INC. INTEREST AND SHARES FROM W.A.WRAY,,JR. AND KAY G. WRAY t. STOCK PURCHASE: $96,000.00 Purchase by F.,J. and Bill Seloaky Betsy will retain 50~ ownership F.J. and Bill Selosky will each have 25% ownership II.CORPORATE NOTES: $120,00.00 A. A. Corporate notes due to W.A. wray, III $40k J.L. Wray S40k W.A. Wray, Jr. $40k Negotiate repayment plan III-LEASES A. Definition of fair market Value needs to be discussed and determined, to inclUde a "deal" as any lease would. B. Expansion options with lease hold improvements Mr.Wolfe's Shoe repair shop C. AIC, Heating, Plumbing, parking, Electric, Water, all need to be discussed. D. All of these must be in place before bank wil~ grant a loan for the buy-out. IV.LIFETIME HEALTH INSURANCE A. Needs to be negotiated, especially W.A. and J.L. out of college issue. W.A. may go to college for the rest of his life off and on. V. HOURLY RATE A. Through transition period is fine. VI.NON-COMPETITION CLAUSE W.A. Wray, Jr.1 Kay G. Wray, W.A. wray, III/ J.L.Wray A. This will also be required by the bank obtain a loan. B. Non-compete clause with Do Wray Mi .C. No disclosure- a)Customer/custorner's lists b)confidential information c)File, records, books, documents, etc. tfflo .. DEFENDANT'S i EXHIBIT m __=La WILLIAM ALBERT WRA Y, JR, and KAY G. WRA Y, Plaintiffs v. WRA Y'S MUSIC HOUSE, INC., WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, Ill, Defendants AND NOW, this _ day of . . . IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYL V ANlA CIVIL ACTION - LAW NO. 00-1960 JURY TRIAL DEMANDED ORDER , 2001, upon consideration of Defendants Motion in Limine, it is hereby ordered that Defendant's Motion is hereby GRANTED. 61865.1 "< "' - .~ ~ -, '" BY THE COURT: J. ~ . . WILLIAM ALBERT WRA Y, JR, and KAY G. WRAY, IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA Plaintiffs v. CIVIL ACTION - LAW WRA Y'S MUSIC HOUSE, INC., WILLIAM R. SELOSKYand FRANK JOSEPH DeSTEFANO, III, Defendants NO. 00-1960 JURY TRIAL DEMANDED DEFENDANTS MOTION IN LIMINE 1. This matter is scheduled for a non-jury trial before the Honorable Edward E. Guido on Wednesday, April 25, 2001. 2. Pursuant to the In re Pretrial Conference Order entered in this matter by Judge Guido, parties were to exchange a list of all trial exhibits on or about April I, 2001. 3. Pursuant to the aforementioned Pretrial Conference Order, parties were instructed to file Motions in Limine raising any objections to the identified exhibits. 4. Counsel for Defendants files this Motion in Limine objecting to three of the Plaintiffs' seven identified exhibits. 5. Plaintiffs' Counsel has identified correspondence dated May 5, 1997 from undersigned counsel to William R Selosky regarding a possible Employment Agreement between defendant Selosky and Wray's Music House, Inc. A copy of the correspondence is attached hereto for the Court's convenience as Exhibit A 6. Plaintiffs have not indicated the intended use of this exhibit. However it is anticipated Plaintiffs will attempt to use it in an effort to establish the breadth of Mr. Selosky's roles and responsibilities with Wray's Music House, Inc. 7. It is also anticipated that Plaintiffs may argue the existence of the May 1997 letter evidencing advice from counsel on a completely separate issue establishes that Mr. Selosky either - ..-="7_.~ had advice when entering into the Agreement of Sale at issue in this litigation or had advice at his disposal. 8. Either such use by the Plaintiffs is objectionable on several grounds, the most significant of which is that is irrelevant to the current litigation. 9. The correspondence deals with a proposed Employment Agreement under consideration prior to the time that Defendants purchased Plaintiffs' interest in Wray's Music House, Inc. 10. Plaintiffs' complaint in this litigation is premised upon a belief that they are entitled to lifetime health insurance benefits from Wray's Music House, Inc. as a result of the sale of the business. II. The issue of the sale ofWray's Music House, Inc., let alone the health insurance benefits of Plaintiffs are not mentioned in the identified Exhibit nor an issue at that time. 12. The Employment Agreement which is the subject of the correspondence was never entered into. 13 . Correspondence from Counsel on a contract not entered into does not address the issues involved in the current litigation, is not relevant and should not be admisable at trial Pa. R.E. 402. 14. Plaintiffs have also indicated they intend to use the proposed agreement which is the subject of aforementioned May 5, 1997 correspondence as an exhibit. A copy of the proposed contract is attached hereto for the Courts convenience as Exhibit B. 15. As stated, the proposed agreement was never executed. 16. As stated, the proposed agreement does not address the issues involved in this litigation. As a result it is irrelevant and should not be allowed at trial Pa. R.E. 402.. 17. Plaintiffs' Counsel has also indicated they intend to use the financial records of Larry Crown, CPA who is the accountant for Wray's Music House, Inc. The Plaintiff has not yet subpoenaed these records. 18. From discussions, with Plaintiffs' Counsel, it is believed that these records are intended to be used to establish that Wray's Music House, Inc. did make payment for Plaintiffs' health insurance benefits after sale of the business. "1"'. .. , - 19. Although this issue may be relevant, it is not necessary to utilize the Exhibit in that Defendants have admitted such payments in paragraph 11 of their answer in New Matter and Counterclaim. Furthermore, Counsel for Defendant has indicated that this issue could be addressed by stipulation at time of trial. 20. Although a limited portion of Wray's Music House, Inc.'s financial records may be relevant on the issue of payment, this statement is not contended and disclosure of these records to the Plaintiffs who run a competing business would be unfairly prejudicial to the Defendants Pa. R.E. 402. WHEREFORE, Defendants respectfully request that Plaintiffs be precluded from using the May 5, 1997 correspondence, the proposed Employment Agreement, and the financial records of Wray's Music House, Inc. as Exhibits at trial in this matter. Tho as 1. Weber, Esquire GOLDBERG, KATZMAN & SHIPMAN, P.e. Attorney LD. #58853 320 Market Street P. O. Box 1268 Harrisburg, PA 17108-1268 (717) 234-4161 Dated: April 16, 2001 Attorneys for Defendants 61801.1 M_,< , CERTIFICATE OF SERVICE I hereby certifY that I am this date serving a copy of the foregoing document upon the person(s) and in the manner indicated below, which service satisfies the requirements of the Pennsylvania Rules of Civil Procedure, by depositing a copy of same in the United States Mail, Harrisburg, Pennsylvania, with first-class postage, prepaid, as follows: R. Mark Thomas, Esquire 101 South Market Street Mechanicsburg, PA 17055 ALSO BY FACSIMILE By: Thorn J. Web ,Esquire Attorney LD. #58853 320 Market Street P. O. Box 1268 Harrisburg, PA 17108-1268 (717) 234-4161 Attorneys for Defendants Dated: April 16, 2001 1.J.:W o!tplr;JUII GOLDJ31U10, KATZMA:N So SHIPMAN. p.e. AONAlD M. I(ATlMAN W;.RR'I' B. GOll)Bt~o " lorl: ~lPMAN pAUL J. [SPOSlfO NEIL H[ND!"8HOf J, JA.Y COOPER THO"lA9 [, 8AtNNtR JOI-lN A. ST..Tl.CA Apftll. I., ITAANG."'UtA.v GUY H. BROOKS Jr:f!''''t''&Q~ J. 6H1PMAN KAAtN 8. ,.t:lJr;;HttN~t~Gf.~ JERRY J. AUSIO MiCHAEL J, CRoe.." ARNOLD I. KOGAN THOMAs J. W(O[R EVAN J. Kl.INE, III JOHN OEL.ORtNlO SlEVEN E, OR"1l1l JO~ R. NlN06KY OliO MABKBT 1J'l'aJUr't' STUAWBERRY !IIOOARIt P.O, BOX UUUI '-411"lsBUBO, PBNNBYLV'AWf. 17108-1866 TJlLoBrBoNB: 1111') M~4-d.10I lI' ......' 17,,"J 804-6808 runt U-MA:[L: O'KtlOOKSLAlf.CON AR.THUR l. GOlDBr.ns OF" couNlrL. kE;R5J.1EY onte[; ~l!9 W!.!U CHQ(:oLATf; AVENur ... O. 10M '5! HERSHEY, Pit.. 110"3 17171 B33-404!:1 CAPlLllIll!: OF'F'tCt: ,,~ Wt5t pgMfR(T ITRUT CARLt6\.E, ~A, 17013 17171 o!4S.0S87 May 5, 1997 'TO"" Of'fI!;E: I WlIT MARKI!:T STAEEf yonK, ...... 1'''01 11171 114".7811 ItORMt:t..t1Nb TO IoIARRI&eURG OFFICI!:I Mr. William R Seloskl 1011 Oak11Hl Road l.ewlsberty, PA 17339 He: Employ,;j~rlt Agn~m~nt with Wray Music Hous~ Dear Mr, Seloskl: This letter will memorialize certairt aspects of ollr conversation of TI\ursday, May 11 1997. I understand that at this time you Wish to hanQle discUssions directly with Wray Music House In an effort to efficiently and amicabiy reach ah ut\derstanding regarding your position with tI\e olganiutiol\. To the extent any of the infonnation corttained In this letter is conveyed to the principles at Wrd.Y Music House such activity on your part should not be consttued as a waiver of the attomey/dient privilege as It exists as to the remainder of our telatlonship. , i I , Initially, I must state that Ute agreement t reviewed on your behalf Is not what I had antidpated based uport our previous discussions regarding your understanding of your future role with Wray Music House, With that said, let me CbIi\fitent that in reviewing a proposed employment agreement for an existing employeel the agreement nonrtally takes the form of mernoriatl:!:lng the existing relationship or altering the relationship In one or more ways. In reviewing t1,e proposed employinent agreement wiut the information you have provided to me, it appears that this agIeement ttlemorializes the benefits you already receive while placing totne additional restrlctlons on yoti without confetrlng any additional benefit. At this time, I would like to review the proposed agreement provision by provision. To auist . In the analysis, I wllllncoiporate the headings contained In the proposed agreement. - T G", .U'~{(l,!i. IJI ,'),T,'lI,WWPII.J.i'U11TI, ',:or " ~...~ ~'lJ?~ ~\l 1'~J,. ~ Mr. William It Seloski .Page 2 May 5. 1997 Employment TIlis provision is not Vt!ry significant. However. I do note that yo . ion is to be that of General Manager. Your current business card identifies you a Presiden eneral Manager. Therefore, it is possible to Construe this new position as a demotIOn, DutIes ()f Employee This provision is the first example of an overriding problem I notice with the employment agreement. This ;lgteemellt appears to be a standard form agreement drafted for the benefit of the employer. ~ a result, it is cxtrenlely vague and fails to clearly articulate what your responsibilities would be under the tenure of your employment. Asa result of its vague nature, the agreemeM leaves maIlY Issues open to interpretation.. As a result, the possibility for a conflict of interpretation is increased. This provision provides YOllr employer With the opportunity to increase your . responsibilities without any additional compensaticl1, In essence, the employer has unfettered control over your job responsibilities. Specifically, the clause contains the provision; "employee agrees to perfortXl faithfully all such duties as may be assigned to him In the coW'Se of his employment with employer." At a minimum, I would suggest addition of the language "typically performed by a general manager" after the word duties in the proposed agreement. I would also suggest that the agreement be revised so as to arLiculate s.ome of the typical duties you may be expected to perform. Your abilities and respoIl$ibilitles regarding employee decisions should be clarified. In addition. your ability to negotiate directly with vendors should be spelled out. Tltis clause enables you to engage il) other employment without the cOnsent of your employer as long lis It does not COnflict or Impair wit!, your performance under the contract, TIlls provision is In conflict with clause 5.c which enables the employer to terminate you for cause if you accept a position with another employer without consent (there is no restrictiun that the position must ~onf1jct with or impair your ability under the contract). 11lis difference should be reconciled. Finally, 10 as to place some restrictions on the employer's control regarding your ~ duties and ,~sponslbUi~es, I would suggest that thIs clause contain the following (or similar) ~~nguage: It !s recognized that the general manager will typically spend more than 40 hours ~"~ ~ <:0'd J'jlfiJfl.~'i (Ii ..o1':!T"lJ \]tj.UFt ~Ji1i'Jk1 1.1 fJi:lS w<< "'.": HI ~AA7.-~A-<<7iZ ,_ ~~ yf ",^"""l" ~Iij'j Mr. William R. Seloskl Page 3 May 5, 1997 a week performing work-related activities, though there is no such requirement that such hours be spent. In the event the employee's job responsibilities result in him devoting more than XX hours a week on average for a one-month period. it is recognized that employee will be entitled to a XX percentage increase in his base salary." Though this clause does not necessarily limit additional responsibilities, it does provide you with a mechanism to obtain additional compensation for the extra effort. Term 1his clause is not very favorable from your standpoint. Initially, it only provides you with one year of employment. In addition, the employer has the ability to terminate at the end of the first year. There is not a similar provision for you. Furthermore, following completion of the first year, this agreement does nothing more than require two-nlonths' notice, as opposed to the typical courtesy of two-week notice... to tenninate the relationship Despite the absence of any additional job security on YOllr part, you would still be strapped with the restrictive covenant contained later in the contract. I would recommend that the dause be rewritten to provide additional periods of equal terms. Also, a provision to renegotiate the terms of the contract at an appropriate time frame. or an escalator dause, should be included so that your compensation and fringe-benefits packages can be modified at least keep pace with inflation. Compe"sallon . (a) Splary: As drafted, the agreement does not provide you with any salary. Instead, you are provided with a pure commission of 7% based upon gross profits. I would recommend that you attempt to negotiate at least a minimum salary so that in the event the corporation does not obtain a gross profit despite YOllr best efforts you are still compensated for your efforts. In addition, the contract does not determine how gross profits are to be defined. This ambiguity provides the employer with the opportunity to manipulate the extent of this commission. (b) Ftlnge Benefits: . The Schedule A pro\lided by Wray Music House appears to be rather bare bones. I do not believe It would be ,mreuonable for you to request that the face value of life lnsunmce be increased. In addition, vacation of two weeks should be clarified. Since your J~dlii 1ii1il1iiIJ.' 'lJJ1J:;:!!iI;;' WitH 1.I'Hllill "fllT' 'Ill' Ill?"'~ 'i'\i!\i!':: ii!\l ~jjC Mr. William R. Seloski Page 4 May 5, 1997 salary is based solely upon commission of gross pront for a given month, yoU do not technically obtain paid vacation. In addition, 1 suggest that you ask for additional thnl! since two weeks is not commensurate with someone holding your respoIlsibilities. l1u! medical insurance provision needs to be clarified so as to determine whether it provides coverage for your family and it should also identify what ancillary coverages you can expect (such as dental). The provision for emplayee reimbursement for employeNclated expenses is an acceptable principle. However, as contained in Schedule A it is impennissibly vague, It does not identify how an expense is detenniI\ed to be employer-related. Additionally, it does not addreS5 the timing of the reimbursement. It is concei'Vable that for your job you would be required to travel at great personal expense to yourself. Without clarification of when you could expect reimbursement, this provision could prove financially burdensome for you. I would also suggest that you request that a disability policy be obtained. You should also ask for sick days and personal days so as to account for unexpected emergencies which due arise but should not diminish your vacation time. (c) BOHUS: 111e contract contains an unusual way of wording yOllr entitlement to a bonus. Since ~ou are not entitled to a bonus until the corporation has shown a profit after taxes. it would ~ ppear that your bonus would be: calculated after all normal a~unting work had been done. However, your bonus itself would be a normal business expense entitled to be listed on the ,~ corporation's tIDe returns. Therefore, you end up in a situation of which came first, the chicken or the egg, Though nat tenibly prablematic, it does raise some accounting issues. In addition. yau must recognilte that the entitlement to a $3,000 bonus will appear to be good negotiating on your part if the cotporlltlon only shows a prafit of $3,001 at the end of the year. However, shauld the corparatian show significant profits due to your efforts throughout the year, your $3,000 bonus may appear minuscule. . Termination (a) Death: This provision appears. acceptable! However, it may be helpful to clarify your beneficiary's entitlement to ,the life Insurance poHcy Identlfied in Schedule A. In addition; this provisIon should not be viewed to eliminate any entitlement to workers' compensation or other Iniurance benetlu if your death is work-related. , -",""~. t'J'~ H::(jf1~1ii ) 'Ii HI""7;H') .nll!H'lI J~iitlJJl'CJ:ac "i ph' I~ ""illi'.1" jii'il ~~c ~ Mr. William R. Seloski Pagl! 5 May 5. 1997 (b) Disability: .~ Date of disability is confusing. Is it the first day of a disability that then proceeds for \,~"/ 90 dayaor is it the 90th day after you have been off the job due to a disability? If it is the ~ lattl!r, the employu's obligation to pay you extends for six months instead of three months. . If it is viewed retroactively. then tlte employer's obligation only exists for three months.. In any event, the addition of a disability policy will make the provision more palatable. I would also suggest that the last sentence of this dause be rewritten to read: "in the event of any dispute under this paragraph, the employee agrees to submit to a physical eltamination by a licensed physicIan agreed to by the employer and employee. The said cost of such examination shall be paid by the employer." (p) Cause: The ambigqity of this provision is troublesome. In addition, it provides the employer with considerable discretion to base determinations upon subjective findings. Also, as mentioned, acceptance of a job without the consent of the employer is inconsistent with the ll\nguage contained in the duties provision of the contract. The agreeml!nt is also interesung in that It does not provide the employee with any abUity to tenninate the contract for cause. In order to protect your interests, there s~puld be a similar provision providing you with an escape clause should the corporation undertake a CI:lUl'Sl! of action which you find to be unacceptable. Finally, the clause's ability to eliminate your l!ntitlemerlt to certain forms of compensation, sucn as unemployment compensation or claims for wrongful discharge. is unacceptable. TrRde Set;rets and Co'!fi4entialInfprm(.ltion This clause does not recognize the thoughts and materials that yoU have already brought to the organization. It should be rewritten to include a clause similar to the following: "it is recognized by employer, that employel! has brought with him into this employment agreelnent certain thoughts, ideas. knowledge, amVor plans. and l\Othing in this agreement I. Intl!nded to divest the employee of these thoughts, Ideas, knowledge; and/or plans. It i. .pecifically recognized that employee shall retain the right to use any such pre. acquired thoughts, Ideas, knowledge, and/or plan. following disassociation with the organization" . Se"d '.~16 6~;'t.":i' t kitJf~-'''J flNH.-l. ~1"t'1111 fliE' iiio;j"'t>: 1 e eee2; se <<1ft . ~ "I '.I rj Ii I ;;j '1 i , , , "- Mr. William II Seloski Page 6 May 5, 1997 Notl.Compaition TIlls clause and the proceeding one (Trade Secrets and Confidential Infonnation) are the twO best e.xamples of additional restrictions being placed upon you by this agreement. Though in a vacuum they are potentially appropriate, in reviewing the agreement I do not notice any additional compensation or benefits you are obtaining in exchange for agreeing to these restrictions. tyrom this fact alone, it is questionable as to whetl e.r,any non- ......competition clause would be enforceable due to the lack of adequate nsidera~:; In addition, I find the clause problematic due to the subjective nature of detennination such as directly or indirectly reeruiting or hiring another employee of the employer. As we discussed, tile clause does not recognize that without any solicitat,ion from you, a fonner employee of Wray Music House could seek future employment with ydu or some entity related to you. In addition, the one-year restriction OIl you from being aSSociated with or employed or having any interest in any business which is the same or substantially similar to employer's business or to any affiliate or parent of the employer is unreasonably broad. As !iiscussed, it appears that the corporation has various other business entities. As a result, what may be detertl)lned to be related to these vanous business could throw a rather wide web over the potential job opportunities in this market. In addition, the contract does not deftne what is the same or substantially similar to the employer's business. In fact, the contract itself does not even define the employer's business. Though the desirability of a non-competition clause by an employer is recognized, this intended clause highlights the fact that the mare reasonable approach to take would be to offer you an ownership interest in the corporation. By linking you to the corporation through such an interest, the stock agreements and redemption plans would provide the corporation with the additional assurances that you would not undertake any conduct detrimental to the corporation; In addition to these contractual provisions, the fact that you would be an owner would provide ule best protection to the corporation. Remedle, nus clause would moreapproprlately be entitled remedies of the employer since that is all thatis mentioned. You .hould nOt unilaterally agree to such extraordinary relief as an injunction impinging your ablllty to earn a living without receiving appropnate . compensation, '1~:" I """1i1 I Oiiilg I..'..J C-h. T ao .aOl. Dl?' Ot:ll ..J,~.~ J "iL"iJIfl\], j' 'HJ:;]t4.::Ilill(MIIi.... ... .... J. ....... .- ..- - - --.... -- --.. . , .. ~' / . ''ij"..L. Mr. William R. Seloski Page 7 May 5, 1997 401K Plan This clause does not go far enough, It mentions that you can defer your bonus payments to the 401 K plan but it does not provide any other opportunity to participate, In addition, it does not mention whether the employer will be c::ontributing on your behalf. Election to Board oj nlmtoT$ TIlis provision seems fine as long as the determination of whether yoU are performing your duties and responsibilities in accord;ance with the agreement is made equitably. Assipm;nt and Amendment Acceptable. Employee Acknowledgment Acceptable. It must be noted that I advise yOtlnot to enter into this agreement as written. Employee Repnsentatlon Acceptable. General ProvMon, (a) Severabllltyi Acceptable, (b) Go",,,,'ng Law: Acceptable. This sentence should be modified to substitute the word substantive for substance. M Notices: Acceptable. . ...L'r((I( ,.,. '''-l"lUJiI..liI!l1ll.l.!liU.M 1,'':""1 11.' ~.i"-SlIiI'l~r'l~.';J~ , " ." ae"d Mr, William R. Seloski Page 8 May 5,1997 (d) NOH Waiver: Acceptable. (e) TIle Entire Agnement: Acceptable. (f) Binding Effect: Acceptable. The identification of the clauses appearing at the end of the contract as accept.able should be viewed as merely indicating that this is typical language contained in an employment agreement. It should not he construed in any fashion a$ a representation that the agreement in part, or as a whole is acceptable, only that should an agreement be written to address the numerous concerns I have identified the inclusion of these provisions would 1lI0stlikely be acceptable. In summary, this agreement is not what I had anticipated. In the event that the poSSibility of an ownership share is no longer present, it may be possible to entef Into an appropriate employment agreement. However, before I can recommend the signing of any such agreement which would place severe restrictions on your ability to find employment elsewhere, I believe you should demand that the agreement be rewritten so as to recognize your contributions and fairly compensa~ you for the sacrifices YOll are being asked to make. Mtcr you have had an opportunity to review this letter, kindly give me a call to dIscuss any comments. questions or concerns you may have. Very truly yours, . ~~w~~~ TJW/kdm -'" ".- .IIIIIitrraL_.. .~... 4,...........~ ....M ,. l~Ift. "';~O~ji I.J~ ?h.T~ ~~~7 ~~ ~~5 ~"'3ii1"H" O...."'T.-I ',.H"'. .M.. .I..'.n. "." .. ,.,., .... .., ,..... ...... "..... , , 004477-00014IMarch 21, 1997/EGMINLB/62137.2 t~[P)f EMPLOYMENT AGREEMENT THIS AGREEMENT is made this day of , 1997, between Wray's Music House, Inc., a Pennsylvania corporation with its principal place of business at 326 Market Street, Lemoyne, Cumberland County, Pennsylvania (hereinafter "Employer") and William Selosky, of Lewisberry, Pennsylvania, (hereinafter "Employee", with reference to the following background: WHEREAS, Employer desires to retain the services of Employee and Employee desires to be employed by Employer in an executive capacity; . NOW THEREFORE, in consideration of the Employer's Agreement to hire Employee and the further confirmation of such employment, and the compensation to be paid tQ Employee in connection with such employment, and in further consideration the mutual promises and convents set forth herein, the parties with intent to be legally bound hereby agree as follows: 1. Emvlovment. Employer hereby employs Employee and Employee hereby accepts employment with Employer as Employer's General Manager. .! 2. Duties of Emplovee. Employee shall devote his full time and best efforts to the service of Employer while employed by Employer in this or any other capacity. Employee's duties shall include the performance of such services and the undertaking of such responsibilities as may be ~irected of the Board of Directors of Employer from time to time, and all such other duties as may be ordinary or customary for or incidental to, the position of General Manager in the organization of Employer. Employee acknowledges and agrees that Employer's business and personnel needs are not static and that }<:mployee's specific duties may therefore be modified from time to time. Notwithstanding any such modification of duties, Employer and Employee agree that the employment of Employee shall be construed as continuing under this Agreement. Employee agrees to perform faithfutIy all such duties as may be assigned to him in the course of his employment with Employer. During the term of this Agreement, Employee shall not engage in any other employment or activities that may conflict with or impair his performance hereunder, without the prior consent of the Board of Directors of Employer. :'1 i , I ~ -~-. 004477-OOO14/March 21, 1997/EGMINLB/62137.2 3. Tenn. This Agreement shall be for the term of one year, beginning on , 1997 and ending on ,1998. Unless Employer, by written notice to Employee within (30) days of the end of the first year elects not to renew Employee's employment, this Agreement shall continue in effect after , 1998 until terminated by either party giving sixty (60) days written notice of termination to the other which notice shall state the intention to terminate and the effective date of termination. Except in the case of termination by Employer for good cause prior to end of the then current term, which shall be effective immediately upon notice to Employee, Employee shall continue to discharge his normal duties and receive his compensation as provided herein ilntil the effective date of termination as set forth in the notice. 4. Comuensation. As compensation for all services rendered by Employee to Employer, Employee shall be entitled to receive from Employer, subject to withholding and other applicable employment taxes' and payroll deductions, the following: (a) Salary. An annual draw against commissions in the amount of Nineteen Thousand Five Hundred and 00/100 ($19,500.00) Dollars, payable in semi-monthly installments. A monthly commission equal to seven (7 %) percent of the gross profits of Employer earned in the preceding month, payable within two (2) weeks of determination thereof. Employee shall also be entitled to such salary adjustments, if any, as may be agree<il to by the Board of Directors c::... ' of Employer and set forth in an amendment hereto. (b) Frin!!e Benefits. Such insurance, vacation and other fringe benefits as shall be agreed to by the Board of Directors of Employer and set forth in Schedule "A" hereto. (c) Bonus. A yearly bonus of $3,000.00 will be paid after corporation shown a profit (at least equal to the bonus), after taxes, as the end of each corporate fiscal year. 5. Tennination. The employment of Employee with Employer shall terminate prior to the expiration of the then-current term of employment only for any of the following reasons: (a) Death. The Agreement shall terminate upon the death of Employee. Employer shall have no further obligations to his executors ot administrators, heirs or any other persons claiming through or -2- c',. ~ --.n . nN under him. f . h~l~ ot' \ ,(A ,M (b) Disability. This Agreement shall terminate upon the Employee's "Date of Disability" which shall mean for the purposes of this Agree!ll~nt the first date as of which Employee because of injury or physical or mental illness has been~o perform fully his duties as an employee for a continuous period of not less than ninety (90) days (during which period Employer shall continue to compensate Employee as provided herein). In the event this Agreement is terminated pursuant to this paragraph, Employer shall continue to compensate Employee through the end of the third month after which the date of disability occurs, and thereafter Employer shall have no further obligation to compensate Employee. In the event of any dispute under this paragraph, the Employee agrees to submit to a physical examination by a licensed physician selected by the Employer. '004477-OOO14/March 21, 1997/EGMINLB/62137.2 ~ ~ , ! (c) Cause. This Agreement may be terminated by Employer for action or failure to act by Employee constituting "Cause" which shall mean for the purposes of this Agreement gross neglect of duty, the acceptance by Employee of a position with another employer without consent, intentionally engaging in any activity which is in conflict with or adverse to the interests of Employer, willful misconduct on the part of Employee, misfeasance .or malfeasance of duty causing a violation of any law which is determined to be detrimental to Employer, or breach of this Agreement which has not been corrected by Employee within ten (10) days after his receipt of written notice of such breach. . In the event this Agreement is terminated pursuant to this subparagraph, Employer shall pay to Employee an amount equal to the installment of his draw for the month in which the termination occurs, and thereafter Employer shall have no further obligation to compensate Employee. 'I \1 :1 "I ~ 6. Trade Secrets and Confidentinllnfo171Ultion. Employee, during his employment with Employer, may /have access to and become familiar with o' .' . confidential information which may be used in the operation of the business of Employer or its affiliates. Employee shall not disclose any of the aforesaid I. liS .. confidential information, directly or indirectly, nor use them in any way, either during his employment with Employer or at any time within three (3) years thereafter, except as required in the COUrse of his employment with Employer. All files, records, books, documents, drawings, specifications, plans, written information, computer programs, equipment and similar items, and copies thereof, relating to the business of Employer, whether prepared I I \, -3- '.i,~\.'fi!~~_=_" , -"~ - 004477-00014/March 21. 1997/EGMINLB/62137.2 by Employee or Employer or otherwise coming into Employee's possession, shall remain the exclusive property of Employer and shall not be removed from the premises of Employer under any circumstances without the prior written coment of Employer, except as required in the course of Employee's employment. Employee acknowledges that from time to time Employer, in the due course of its business operations, comes into the possession of confidential information of third parties, and Employee agree that such information shall be presumed to be a trade secret and confidential and shall be treated by Employee as though the information were the trade secrets or confidential information of Employer. Upon termination of Employee's employment, for whatever reason, he shall return to Employer or retaining any copies thereof, all property of Employer, however obtained. UJ..l ...~.,.. -: iltlllldu" .... c, j '" ,.fVV ~ ," , Non-Competition. p. ing the period of Employee's employment with Employer and for a period of Ion of employment for any reason, with or without cause, Employee shall not directly or indirectly recruit or hire any employee of Employer, or otherwise induce such employee to leave the employment of Employer, to becoine an employee of or otherwise be associated with Employee or any company or business with which Employee is or may become associated, nor shall Employee directly or indirectly solicit present or former clients or customers of Employer. Employ.ee further agrees that he shall not. for a continuous uninterrupted period .y commencing upon the expiration oi\.termination of his employment by Employer, regardless of the cause for termination, and continuing for one (I~year thereafter, either directly or indirectly, for himself or through or on behalf of or in conjunction with any person, +tity or corporation. own, maintain. engage in, be employed by, advise, assist, invest in, make loans to, or have any,Nhterest whatsoever in any business which is the same as or substantially similar to Employer's business, or that of any affiliate or parent of Employer, and which is located within a radius of fifty (50) miles of Employer's principal place of business. " , 'I , ~ 8. Remedies. In the event of a breach of this Agreement by either Employer or Employee resulting in damages to the other party, that party may recover from the party breaching the Agreement any and all damages at law and/or any and all equitable relief to which the party may be entitled. The parties hereto recognize that irreparable injury will result to Employer, its business and property, in the event of a breach of Paragraphs 6 and/or 7 of this Agreement by Employee. It is therefore agreed that in the event Employee breaches either or both of said provisions of this Agreement, Employer shall be entitled, in addition to any other remedies. and damages available (i) : to an injunction to restrain the further violation thereof by Employee, his partners, agents, servants, employers and -4- '-,., , "- ~- 'OO4477-00014/M.rch 21, 1997/EGM/NLB/62137.2 employees, and all other persons acting for or with him, and (Ii) to compel specific performance of the terms and conditions of this Agreement. Nothing herein shall be construed as prohibiting Employer from pursuing any other remedies available to Employer for such breach, including the recovery of damages from Employee. 9. 40Ukl Plan. In the event Employer establishes a profit sharing 40 1 (k) plan, Employee shall be entitled to defer his bonus payments into the 401(k) plan, if any is established by Employer or any equivalent pension or profit sharing plan. 10. Election to Board of DirecJors. So long as Employee is performing his duties and responsibilities in accordance with this Agreement, he shall be entitled to serve as a Pirector of the Corporation to so serve with the other members of the Board of Directors, provided, however, that should Employee's employment be terminated for any reason, he shall be deemed to have tendered his resignation from the office of Director of the Corporation. 11. Assiflnmeni and Amendment. This Agreement is personal to each of the parties hereto and neither party may assign or delegate any rights, duties or obligations hereunder without first obtaining the written consent of the other party hereto. This Agreement may not be amended, modified, altered or rescinded, or any rights hereunder waived, except by written agreement signed by the parties hereto. 12. Emalovee Acknowledllement. Employee acknowledges that the terms of this Employment Agreement may restrict his employment opportunities when and if his employment is terminated in accordance with the terms of this Agreement. Employer has recommended to Employee to have this Employment Agreement reviewed by his attorney prior to its execution and Employee hereby represents and warrants to Employer that either this Employment Agreement has been reviewed by his attorney or Employee knowingly has elected not to have it reviewed. 13. Em"lovee Re"resentation. Employee warrants that he has not previously assumed any obligations inconsistent with this Agreement. 14. General Provisions. (a) Severability. If any term of or provision hereof shall be held to be invalid or unenforceable -5- " , . . ~" d04477-00014/March 21, 1997/EGMINLB/62137.2 for any reason or under any circumstances, that term or provision shall be ineffective only to the extent of such invalidity or. unenforceability, and the remaining terms and provisions shall in no way be affected or impaired and shall remain in full force and effect. (b) Governing Law. This Agreement shall be governed by and interpreted and enforced in accordance with the substance law of the Commonwealth of Pennsylvania, without reference to the principals governing the conflict of laws applicable in that or any other jurisdiction. (c) Notices. Any notices required to be given hereunder by any party to the other may be effected either by personal delivery in writing or by mail, registered or certified, postage prepaid with return receipt requested. Mailed notices shall be addressed to the parties at the following addresses or to such other addresses as either may designate in writing to the other: If to Employer, to: Wray's Music House, Inc. 326 Market Street P.O. Box 419. Lemoyne, Pennsylvania 17043 If to Employee, to: William Selosky 1011 Oak Hill Road Lewisberry, Pennsylvania 17339 'il (d) Non-Waiver. The failure of either Employee or Employer at any time to require the performance by the other of any of the provisions herein shall in no way affect the respective tights of such party to enforce the same at any other time, nor shall the waiver by either of any breach of any provision hereof be construed to be a waiver of any succeeding breach or as a waiver of modification of the provision of the Agreement itsel f. 'I ::1 :: ~i (e) Entire Agreement.. This Agreement supersedes any and all prior agreements and understandings, either oral or written between the parties,. contains all of the agreements between the parties with respect to Employee's employment, and may not be modified except in writing signed by the party against whom the same is sought to be enforced. -6- Of!~ "n ~, ." - - , . 004477-OOO14/March 21, 1997/EGMINLB/62137.2 (0 Binding Effect. The provisions of this Agreement shall be binding upon and inure to the benefit of both parties hereto, their respective heirs, personal representative, successors and assigns. IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the day and year first above written. ArrEST: EMPLOYER: WRAY'S MUSIC HOUSE, INC. By: Title WITNESS: EMPLOYEE: (SEAL) William Selosky -7- ""<-~- ~~ - -;~= - ~ . 004477-OOO14/March 21, 1997/EGMINLB/62137.2 Schedule . A" to Employment Agreement between WI1IY's Music House, Inc. and William Selosky Fringe Benefits: ~ Life Insurance - term life insurance in the amount of $25,000.00 2. Vacation -,.( weeks 3 3. Medical Insurance H-wb4.MAf J.Aj 'Ii'- 4. Employee Reimbursement for Employer related expenses I "~" _ ~ yJJU-- rl r?tA~. ...-.. ,.l.S -g.. ~ ~c)-!- -8- ._,,"C -4 _ '" "~ " -,,~,~. ~ ,,~ " d ]1lIt'H~, _.~,' "~""_ ~~ - ,~ ~- ~~ "J~!R n I ,,_, ~,~ " M. _"",...,,-,,,.,,,,>~_ _ 'ill -c- ,., (r, ~~:~: ,.---, ~~- i~_. 7", " ~; -~ '~, ,- .~ :3 N ;':1 co -',,' --.;: ;J_!f.rm'~_llIIl'!ffiI'\,,'~;m~~~I<IRI!i@!~~~!IIII!~g~ ^" WILLIAM ALBERT WRA Y, JR. and KAY G. WRAY : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, PENNSYLVANIA V. WRAY'S MUSIC HOUSE, INC. : NO. 2000-1960 CIVIL TERM WILLIAM R. SELOSKYand FRANK JOSEPH DE STEFANO, III ORDER OF COURT AND NOW, this 15TH day of OCTOBER, 2001, after consultation with counsel, a bench trial in this matter is scheduled for FRIDAY. DECEMBER. 14.2001. at 8:30 a.m. in Courtroom # 5 of the Cumberland County Courthouse, Carlisle, Pa. The parties are directed to comply with the dictates of our Pretrial Conference Order of February 21, 2001. Edward E. Guido, 1. R. Mark Thomas, Esquire For the Plaintiffs Thomas 1. Weber, Esquire For the Defendants ~~ /0- /&-1:>1 9-. :sld -j I '" . 'v'lNVA1ASNN3d AlNnoo O~.IV1.'B8I^lm Ot.::Z!J,d SI DO 10 AU\.llo'r~H"'." , uV. I''ll) j.,.Rj,:l :lOli-fC"'CElli.::J 'n :J-v ,-"""",~p .- """.~ 7 ,""1If--1:. ,'-C.'_"~_""'~"-""-'-""'-_,t"",__,_,_~r_;_,____ '_''-_'',~ ~ P' , ,,=, . '''w.'.'' .1 lilll' T PI 'u ~ ~'I;Il',W1!ffi~~l!ielW1~81.!._il'<<~_ _ " ij_~=,. _ h '7" ':"'~!~' " " I ~i 'I! !; ;(i ,;~ '" ]" ill..: " :\1 ,':;1 ,I !j iJ! ji " :'! "~Ii ,;'J ~ ': , !~ :~~ ,', ,~ - - ~ - "' . WILLIAM ALB~RT WRAY, JR.,: and KAY G. WRAY, Plaintiffs 8 IN THE COURT OF COMMON ~LEAS OF CUMBERLAND COUNTY, PENNSYLVANIA V. CIVIL ACTION - LAW WRAY'S MUSIC HOUSE, INC.,: WILLIAM R. SELOSKY and FRANK JOSEPH DeSTAFANO, NO. 00-1960 CIVIL TERM III, Defendants JURY TRIAL DEMANDED IN RE: PRETRIAL CONFERENCE A pretrial conference was held Wednesday, February 21, 2001, before the Honorable Edward E. Guido, J. Present for the Plaintiffs was R. Mark Thomas, Esquire, and present for the Defendants was Thomas J. Weber, Esquire. This is a declaratory judgment action commenced by Plaintiffs in which the Defendants have requested a jury trial. The Plaintiffs dispute Defendants' entitlement to a jury trial in this action. We are striking it from the March term of court and directing that it be relisted automatically for the May term of court. In the interim, the Defendants are directed to file a brief in support of their request for a jury trial by the close of business on Friday, March 2, 2001. In the alternative, they may file a waiver of their right to a jury trial, in which case this will proceed to a bench trial before this Court. In the event that a brief is filed, Plaintiffs are '.'" ~.,~ ~." ,._ ,~o, ' . '~~ . directed to file a reply brief by the close of business on Friday, March 9, 2001. In the event that Defendants file a waiver of jury trial, this matter will be heard before this Court commencing at 8:30 a.m. on Wednesday, April 25, 2001. Whether this proceeds to a jury trial in the May term or a bench trial before this Court on April 25, 2001, both parties are directed to comply with the following: 1. All exhibits intended to be introduced at trial shall be marked prior to trial. A list of, and opportunity to review, the exhitis shall be provided to the other party by April 1, 2001. Any objections to the other parties' exhibits must be made in the form of a motion in limine. 2. All motions in limine, with supporting authority, shall be filed not later than 10 days prior to the commencement of trial. Any response, with supporting authority, shall be filed not later than 3 days prior to the commencement of trial. 3. The parties are directed to file a trial brief in support of their respective positions at the commencement of the trial. The parties have indicated that this should take approximately 1 day to try at a bench trial, and 1 1/2 to 2 days before a jury. ~ "-- . -li _11 I, i! !j !I l' i:i , 'I i-I , :1 ,; :i 'j H I '~~", - . R. Mark Thomas, Esquire For the Plaintiffs Thomas w. Weber, Esquire For the Defendants :mae '" -~ - ,-- By the Court, Edward E. Guido, J. .~ " ,,- ."'"'" u ~.__~" .~ ',,~' .'1IItlI'II!I'_~1!Ill~'inll'::wm "",.r., _ ~I'JII h ~_, -"~ ,. Jimi' . (-~ ,""." , ) '-, ~-~; -n :-"~:- -", n'"i 1 ~~;- ,. ',':-::, " -,J (f) f'< -<:.' .. 2 I:~ ~. I~ ~' ?~: <~" E~' ...'~' C:'J ..,.::.. -! -'-1 f;:-" ._'-. --;'. ';' .-'.' -, I , -,"Bm~~~ll~! " . WILLIAM A. WRA Y, JR. ANDKAYG. WRAY : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, PENNSYL VANIA V. WRAY'S MUSIC HOUSE, : NO. 2000-1960 CIVIL TERM INC., WILLIAM SELOSKY : AND FRANK JOSEPH DESTEFANO, III CIVIL ACTION - LAW ORDER OF COURT AND NOW, this 5TH day of MARCH, 2001, it appearing to the Court that all parties have waived a jury trial, this matter is scheduled for a bench trial before this Court on the date set forth in our pretrial order, dated Wednesday. April 25. 2001. at 8:30 a.m. in Courtroom # 5. In all other respects, said pretrial order shall remain in full force and effect. Ii , 'J ~j ,~ I~ Edward E. Guido, J. -,,' ;'1 (] , ';1 '" Thomas J. Weber, Esquire For the Defendants ~\ Vu ::;D 0/ ~ i~;' R. Mark Thomas, Esquire For the Plaintiffs ("i 'I Cumberland County Court Administrator :sld '--'j ':1 :,1 I , ! j . _ -"Co '---___0. ._ >,' ...... '. fd \-."'!' ~ I~ , ,\!(<~~ V~\}A.8NN:;("' .........., :',.J. ,I ";"::/~L.j"-:;1;:'" "',-1'1"" '''-111..1 ;' .. i ~ s:~ L. tl ,_ ,"P'" ;;'1 c If! i!~ .. d. ./ !. "'~"'~ .."'" . (.~ .! ',~ ~ . u' =''-1- "~:''''::' fJLiiJlull~'~":I',--~ "llj'fM .... lll-' .......J!"'!~~~mIJ!l!'il~_._o_~"~~,~II~.,,",~!Mf!t!Il~f . , i I j 1 I l 1 I 1 " I ~n 1~ ] I j'- j~ -i~ ~ '~j , ~I 11 r Jil "1 tj 11 I A ;'~ '1 1 'j -~-~ 1 1 i ',,' :j :')1 l "Ji '" , -':1 .:t jl , ,,:: ,;, " .'1 ,1 'i i :1 :1 -,,~" , OF COUNSEL F. LEE SHIPMAN JOSHUA D. LOCK ARTHUR L. GOLDBERG (1951-Z000) HARRY B. GOLDBERG (1961-1998) RONALD M. KATZMAN 320 MARKET STREET. STRAWBERRY SQUARE P.O. Box 1268 . HARRISBURG, PENNSYLVANIA 17108-1268 717.234.4161' 717.234.6808 (FAX) MAR 2. 200f~ MAR 2 - '''''1 GOLDBERG, KATZMAN &> SHIPMAN, P.C. ATTORNEYS AT LAW March 2, 2001 VIA HAND-DELIVERY The Honorable Edward E. Guido Cumberland County Courthouse One Courthouse Square Carlisle, PA 17013-3387 Re: Wray v. Wray's Music House, et al. No. 00-1960 Dear Judge Guido: PAUL J. ESPOSITO I have had the opportunity to confer with representatives of the NEIL HENDERSHOT defendants regarding the trial in the above-referenced matter. J. JAY COOPER Defendants hereby agree to waive their previous request for a jury trial. THOMAS E. BRENNER Therefore, the matter can proceed to a bench trial before you on April 25, JOHNA.STATLER 2001 commencing at 8:30 a.m. AI'RIL L. STRANG-KUTAY GUY H. BROOKS JEFFERSON J. SHIPMAN JERRY J. Russo MICHAEL J. CROCENZI THOMAS J. WEBER STEVEN E. GRUBB ARNOLD B. KOGAN ROYCE L. MORRIS EVAN J. KLINE, III JOHN DELoRENZO JOHN R. NINOSKY DAVID M. STECKEL I have already verbally informed plaintiffs' counsel of this action and by copy of this letter I am confirming the fact. Thank you for your attention in this matter and should you require anything further, please do not hesitate to contact me. ~y yours, Tl~~~b~ TJW/kdm cc: R. Mark Thomas, Esquire CARLISLE OFFICE: 717.245.0597 . YORK OFFICE: 717.843.7912 ,-,"- --- '..,_~_",_, "C'h~_';_~~~_-<-C'-"_'" _,'_," .-', ,'i'.__""m"_'__~,.'''''''' 3__'~~'",~""",,_,_ _,-,,, .""_,, '.^"_ ~__ _,0'__'-, ,,-, WILLIAM ALBERT WRA Y, JR. and: KAY G. WRAY, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA Plaintiffs NO. 00-1960 CIVIL TERM v. WRA Y'S MUSIC HOUSE, INC. WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, III, Defendants ORDER AND NOW, this l~~ day of April, 2001, upon consideration of the within Motion For a Trial Continuance filed by the plaintiffs, and the Court being advised that the defendants do not oppose this Motion it is hereby ordered that the motion is granted and a new trial date will be scheduled via a telephone conference. Counsel for the plaintiffs is hereby directed to set up a telephone conference to schedule a new trial date. 1. " " - ,.. ii[,_~~iNIlliWtI!IikilIl~~i1~ljjltillil~>iBJlj;lj.1!W"-''''i6till~~--;~ !~)' LJM1.nI ~,q, ,.,.,.,.,.. ..., __~ ,".~ w, I C~,_ -- -"- ,~"- ,--",- ''''~ liiIIIifr.: ':'~'-~" ,= "illlltliM1Oi1!\Jl ,~" "' ~. J ~ ~ ~ \ ~ 01 /: I (; ,'1': I, I _ /.,. J ".; CU\":,:': "'J"ll-'f j'.',,-~~:_nLf'';i'-;U 1.;'...)1 J\ ) PE~,lNSYl\~!\Ni,i~ -k3 E! WILLIAM ALBERT WRA Y, JR. and: KAY G. WRAY, IN THE COURTOF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA Plaintiffs NO. 00-1960 CIVIL TERM v. WRA Y'S MUSIC HOUSE, INC. WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, III, Defendants MOTION FOR CONTINUANCE AND NOW, come the plaintiffs, William Albert Wray, Jr. and Kay G. Wray, by and through their counsel, R. Mark 'Thomas, Esquire, and respectfully move this court to grant a continuance of the trial in the above captioned matter and in support there respectfully represent: 1. A pre-trial conference was conducted before Your Honor on February 13,2001 and at that time it was determined that this would be a bench trial. 2. The date for the bench trial was scheduled for April 25, 2001 to commence at 8:30 a.m. 3. After having notified plaintiffs of the time and date of the trial I received word that there may be a conflict due to the need for plaintiff William Albert Wray, Jr. to be in California at that time. 4. It has since been confirmed that William Albert Wray, Jr. will be in California to attend a business meeting with the Yamaha Piano Division as an authorized dealer of Yamaha Pianos and Organs. Attached hereto and marked Exhibit "A" is a letter to plaintiff William Albert Wray, Jr. dated April 10, 2001 which states that plaintiff will be in California on April 25, 2001. ';!"1"lII! - - ~ "" ", - 5. As counsel for plaintiffs I have discussed this request with Thomas 1. Weber, Esquire, counsel for the defendants and counsel has advised that they would not oppose the request for a continuance. 6. Both the plaintiffs and counsel for the defendants have been advised that it might be a couple of months before a new trial date can be scheduled. WHEREFORE, plaintiffs pray this Honorable Court will grant this request for a continuance of the trial date. Respectfully submitted, R~~ Attorney for Plaintiffs 101 South Market Street Mechanicsburg, P A 17055 (717)796-2100 ID# 41301 APR-18-2001 03:27 ~M SCOTT WRAY PIANO GALLERY 717 909 9191 P.01 OVA'MAHA April 10, 2001 Bill Wruy Scott Wray Piano Gallery 440 Bridge St. New Cumberland, PA 17070 Dear Bill, I :] ! , :( We are pleased thilt you are joining us in Palm Springs for our Disklavier Focus Group meeting. Enclosed you will find your tickets and the information that you will need to make your trip to sunny California. As you exit. the. airplane at Palm Splings, you will bc met by Dest.inul.1on Management personnel, who will assist you with your baggage and t.ake you directly to t.he resort. ! ] 'i Room reservat.ions at the Manioll Rancho Las Palmas have been confirmed for your stay, Your check-in date is 04/21/2001 .nd YOllr check-nut dale is 04/25/2001. ,., , , I I If YOll have any gllestions or concerns. please call Yamaha Travel Services at (800) 833-9193. ;1 All of us in t.he Yamaha PiaM Divisi<.ln arc looking forward t.o your mput and t.o t.he t.ime t.hat we will spend toget.her 111 discussions and relaxation. See you in Palm Spnngs. "ii :1 I Best regards, , .....___._--.. ,/M,... ~' ,,_ (.....- ."'~G' ,/. '. - /' '... ,~. - C-L Paul Calvin Piano Marketing M.nuger Yamaha Piano Division 'n 1-i ~! , 'j 'I EXHIBIT "A" ""n r ~ - 11 'I 1]! ;j )'1 'I '-I :'; i:1 \-" - ~ ~~ . . CERTIFICATE OF SERVICE I, R. Mark Thomas, Esquire, hereby certify that I have served a copy of the within document on the following by sending a true and correct copy of the same via Fax to: Thomas J. Weber, Esquire 320 Market Street PO Box 1268 Harrisburg, PA 17108-1268 Fax No.: (717) 234-6808 Date: April 18, 2001 ~~ R. Mark Thomas, Esq. - ~ ., :'I.l'f{- Nil!I'~'ij.ltRj^ o ?? rEF-: (":'-' ~""""'""''!'" c' (-" , (= z ,-, -< lilliI' .rt'lfI , . (::'J '-~') -TI .~ ~J :"<:J . -~ 1...0 ") ::~-: ___'c" (~1 i~:(?i :_-; :~ -, .r- ~o...",!~~~ll'H'.ej':-.$-~~~~IRIII1~~_ ,_, _ .!I'm~_~m PRAECIPE FOR LISTING CASE fOR TRIAL (Must be typewritten and submitted in duplicate) TO THE POOTHONJTARY OF CUMBERLAND COUNl'Y Please list the following case: (Check one) (x ) for JURY trial at the next tenn of civil court. for trial without a jury. ---~--------------------------------~---- CAPTION OF CASE (entire caption must be stated in full) (check pne) WILLIAM ALBERT WRAY, JR., and KAY G. WRAY ( X) Civil Action - Law Appeal from Arbitration . ('I- ) Dee/Ala"-"^- Jul;m.u.T (o~ (Plaintiff) vs. WRAY~S MOSIC HOUSE, INC. WILLIAM R. SELOSKY and FRANK JOSEPH DESTEFANO, III The trial list will ~ called on':2/13/01 and Trials conmence on 3/1 2/01 ( Defendant) Pretrials will be held on 2/21 /01 (Briefs are due 5 days before pretrials. ) vs. (The party listing this case for trial shall provide forthwith a copy of the praeci{>e to all counsel, pursuant to local Rule 214.1. ) No. 00-1960 Civil Term 19 Indicate the attorney who will try case for the party who files this praecipe: R. Mark Thomas, Esquire Indicate trial counsel for other parties if known: Thomas J. Weber, Esquire This case is ready for trial. Signed: ~J~ Print Name: R. Mark Thomas, Esquire Attorney for: Plaintiffs Date: 1/22/01 ",jl..,- " - - ~ ., ,.,.....n_ """""".",=,,<,. ."",,~ "'-',:,,_\"'l,~,j;_",f-"-' .." ." ~..,'C"", .- " I".. .1 ..,.,., ..,-. ~ 1Y"lil",,^-<O""lf: '.;"^i'iJi'Y (') 0 0 c:: -- :s:: "7l '- rf{ro ". ::;;1 ~,!fJ .01: ~~l :o- f\) ..r- enS:;: -D-rM N ":t ~6 (:>0 ""Q .:::;:i'Ti ~(') ::r ..L.:::n >0 q?ri ~ CtJ ~ w ?J 0 -< ~!:M;_l'"~I"~~'N~I',,~Il!IIJ!ij~I~~~_,","I_~I_l! "."., _.,_._~_m~' Plaintiffs IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA NO. 00-1960 CIVIL TERM WILLIAM ALBERT WRA Y, JR. and: KAYG.WRAY, v. WRA Y'S MUSIC HOUSE, INC. WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, III, Defendants PlAINTIFFS' RESPONSE TO DEFENDANTS' NEW MATTER AND COUNTERClAIM 16. No answer required. 17. Denied. This allegation is a conclusion of law to which no responsive pleading is required and therefore same is denied and strict proof thereof demanded at time of trial. 18. Denied. As is set forth in the Compla.int, the plaintiffs transferred all their right, title and interest in Wray's Music House, Inc. as consideration for the obligation claimed. 19. Denied. It is denied that any of the health insurance payments previously made by defendants were gratuitous in nature. Further, there was never any agreement by plaintiff William Wray not to enter into a competing business, nor was any such promise made by plaintiff William Wray to the defendants. 20. Denied. As is set forth in the Complaint the defendants have not paid the full consideration which was negotiated as is set forth in the Agreement of Sale. Specifically, defendants have not been paying health insurance benefits since January 1, 2000. --,0--. ~ ~ - ~ -~ -- - 21. Denied. This allegation is a conclusion of law to which no responsive pleading is required and therefore same is denied. By way of further response, this allegation should have been raised by way of preliminary objection and is therefore waived. 22. Denied. There was never an agreement between plaintiffs and defendants with regard to the plaintiffs opening a competing business. In fact, there was never even any discussion of such a term to be included in this agreement. By way of further response, plaintiffs are not in business in direct competition with defendants. 23. Denied. At the time of the execution of the agreement, defendant William R. Selosky was president and general manager of Wray's Music House, Inc. with the authority to bind the corporation. 24. Denied. This allegation is a conclusion of law to which no responsive pleading is required and therefore same is denied. To the extent that this allegation is not a conclusion of law the plaintiffs, following reasonable investigation, are without sufficient knowledge, information or belief to either affirm or deny this allegation and therefore same is denied and strict proof thereof demanded at time of trial. By way of further response, impossibilities of performance does not remove the obligation of performance. 25. Denied. This allegation is a conclusion of law to which no responsive pleading is required and therefore same is denied. To the extent that this allegation is not a conclusion of law it is denied that the agreement was entered into under duress, but rather the agreement was knowingly, intelligently and voluntarily entered into by the parties. 26. Denied. Plaintiffs made no representation regarding opening a competing business. That part of this allegation which claims that the plaintiffs are estopped from seeking ;;1 , -""il1l .. = ,~,~ - , ~- to enforce all the terms of this agreement is a conclusion of law to which no responsive pleading is required. By way of further answer, there were no gratuitous health insurance benefits paid for or on behalf of the plaintiffs. 27. Denied. Plaintiffs are seeking to enforce an agreement that was signed and agreed to approximately two (2) years before plaintiffs opened their new business. By way of further of answer, it is denied that plaintiffs' business is in direct competition with defendants'. 28. Denied. There was never any promise made by plaintiff William Wray that he would not compete against Wray's Music House, Inc. By way of further answer, it is denied. that plaintiff is currently in direct competition with Wray's Music House, Inc. 29. Denied. As stated earlier, plaintiff William Wray never made any representation with regard to opening a competing business and therefore it is denied that there was any fraud on the part of plaintiffs in the formation or execution of the agreement relied upon. 30. Denied. Plaintiffs, following reasonable investigation, are without sufficient knowledge, information or belief to either affirm or deny this allegation and therefore same is denied and strict proof thereof is demartded at time of trial. Further, defendant Selosky specifically stated that he did not want legal counsel involved. 31. Denied. This allegation is a conclusion of law towhich no responsive pleading is required and therefore same is denied. To the extent that this allegation is not a conclusion of law plaintiffs deny that the agreement in question was a contract of adhesion. By way of further answer plaintiffs state that this agreement was based upon mutual negotiations. 32. Denied. this allegation is a conclusion of law to which no responsive pleading is required and therefore same is denied. '1'.\ . ~ ~ ,-,,-- WHEREFORE, plaintiffs pray this Honorable Court will enter judgment in favor of the plaintiffs and against the defendants on plaintiffs' action for declaratory relief. ANSWER TO COUNTERCLAIM WRA V'S MUSIC HOUSE. INC.. WILLIAM R. SELOSDV AND FRANK JOSEPH DESTEFANO. III v. WILLIAM ALBERT WRA V. R. RECISION 33. The allegations and responses contained in Paragraphs 1 through 32 of the Complaint and Answer are incorporated herein as if set forth at length. 34. Denied. There was no discussion at any time during the negotiation or the execution of the agreement regarding the plaintiffs' agreement to refrain from owning, operating or otherwise obtaining any interest in a competing business in any area. By way of further answer, it is denied that plaintiffs even had any thoughts of entering into any new business when this agreement was executed. And further, it is denied that the business that plaintiffs are currently engaged in is in direct competition with defendants' business. 35. Denied. It is denied that there was ever any promise made by plaintiff William Wray not to open a piano gallery as a term or condition of the aforementioned agreement. 36. Denied. It is denied that the Scott Wray Piano Gallery is in direct competition with Wray's Music House, Inc. in so far as Scott Wray Piano Gallery is in the primary business of leasing and selling pianos and keyboards. 37. Admitted. 38. Denied. It is denied that there were any misrepresentations made to the defendants by the plaintiffs. Byway of further answer, plaintiffs entered into this agreement in - 'o~! _ '."_ ~ -I - , - - =_T good faith. Further, there was no intent on part of plaintiffs to open a new business as of the date this Agreement was signed. WHEREFORE, plaintiffs pray this Honorable Court will enter judgment in favor of plaintiffs and against defendants on defendants counterclaim and recision. Respectfully submitted, p~ R. Mark Thomas, Esquire Attorney for Plaintiffs 101 South Market Street Mechanicsburg, P A 17055 (717)796-2100 ID# 41301 !:i .."'" ,~ ~ .. -' '. .,' .., ,- VERIFICATION We verify that the staternents rnade in the foregoing docurnent are true and correct. We understand that false staternents herein are rnade subject to the penalties of 18 Pa. C.S. ~4904, relating to unsworn falsification to authorities. Date: 10 - 2.6 --0 0 Date: /0 - U -cJ[) ~~}i:r~ '"<'ffl'!I ,~~ t- - CERTIFICATE OF SERVICE I, R. Mark Thomas, Esquire, hereby certify that I have served a copy of the within document on the following by depositing a true and correct copy of the same in the U.S. Mail at Mechanicsburg, Pennsylvania, Postage pre-paid, addressed to: Thomas J. Weber, Esquire 320 Market Street PO Box 1268 Harrisburg, P A 17108-1268 Date: /p}? /00 ~d~ R. Mark Thomas, Esq. - ~21 _....,~-,~- -~.- ,,' ,. ,< ~'. ',', ...,. ..~, ~. -,~- ,~,., """". (") (.:> .:) c: 0 ~, :s: 0 :.-j j:Rg;; n ~1<., -'J~ .~ n-1 r.= ~JJ N --''-)In ..~ -J ;:9? ':::lu ...,...1~Y. ;<:::V :t>- O..., ~8 :x :z: ;:') ~~ S? Om W ~ N "< . -:l'ill!lllf'~!fl'ml't~\I"'"!'i",r4W~~i~1i1fT "'-IINIIII ,:~t'~-",~~ > . . GOLDBERG, KATZMAN & SHIPMAN, P.C. Thomas J. Weber, Esquire Attorney I. D. # 58853 David M. Steckel, Esquire Attorney I. D. # 82340 Attorneys for Defendants 320 Market Street P.O. BOlt 1268 Harrisburg, PA 17108-1268 Telephone: (717) 234-4161 WILLIAM ALBERT WRAY, JR. andKAYG. WRAY, IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA Plaintiffs, v. CIVlL ACTION - LAW WRAY'S MUSIC HOUSE, INC., WILLIAM R. SELOSKYand FRANK JOSEPH DeSTEF:ANO, III, : NO. 00-1960 JURY TRIAL DEMANDED Defendants. NOTICE TO PLEAD TO: William Albert Wray, Jr. and Kay G. Wray, Plaintiffs c/o R. Mark Thomas, Esquire 101 South Market Street Mechanicsburg, PA 17055 You are hereby notified to plead to the enclosed Answer, New Matter and Counterclaim to Plaintiff's Action for Declaratory Relief within twenty (20) days from service hereof or a default judgment may be enter against you. Date: "5. 2&? . uu ~ERG, KATZMi)N & SIllPMAN, P.C. BY: ~.WJ~ W~ T mas J. We er, Esquire Supreme Court I.D. #58853 GOLDBERG, KATZMAN & SHIPMAN, P.C. Thomas J. Weber, Esquire Attorney I. D. # 58853 David M. Steckel, Esquire Attorney I. D. # 82340 Attorneys for Defendants 320 Market Street P.O. BOlt 1268 Harrisburg, P A 17108-1268 Telephone: (717) 234-4161 WILLIAM ALBERT WRAY, JR. and KAY G. WRAY, IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA Plaintiffs, v. CIVIL ACTION - LAW WRAY'S MUSIC HOUSE, INC., WILLIAM R. SELOSKYand FRANK JOSEPH DeSTEFANO, III, : NO. 00-1960 JURY TRIAL DEMANDED Defendants. NOTICE TO DEFEND TO: William Albert Wray, Jr. and Kay G. Wray, Plaintiffs c/o R. Mark Thomas, Esquire 101 South Market Street Mechanicsburg, P A 17055 YOU HAVE BEEN SUED IN COURT. If you wish to defend against the claims set forth in the following pages, you must take action within twenty (20) days after this Answer, New Matter, Cross Claim and Notice are served, by entering a written appearance personally or by attorney and filing in writing with the Court your defenses or objections to the claims set forth against you. You are warned that if you fail to do so the case may proceed without you and a judgment may be entered against you by the Court without further notice for any money claimed in the Complaint or for any other claim or relief requested by the Plaintiff. You may lose money or property or other rights important to you. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP. CUMBERLAND COUNTY LAWYER REFERRAL SERVICE Curnberland County Bar Association 2 Liberty Ave Carlisle, PA 17013 (717) 249-3166 - NOTICIA Le han demandado a usted en la corte. Si usted quiere defenderse de estas demandas expuestas en las paginas siguientes, usted tiene viente (20) dias de plazo alpartir de la fecha de la demanda y la notificacion. Usted debe presentar una apariencia escrita 0 en persona 0 por abogado y archivar en la corte en forma escrita sus defensas 0 sus objectiones a las demandas en contra de su persona. Sea adisado que si usted no se defiende, la sin previo aviso 0 notificacion y por cualquier quja 0 puede perder dinero 0 sus propiedades 0 otros derechos importantes para usted. LLEVE EST A DEMANDA A UN ABOGADO IMMEDIATAMENTE. SI NO TIENE ABOGADO 0 SI NO TIENE EL DINERO SUFICIENTE DE PAGAR TAL SERVICIO, VA Y A EN PERSONA 0 LLAME POR TELEFONO A LA OFICINA CUY A DIRECCION SE ENCUENTRA ESCRITA ABAJO PARA A VERIGUAR DONDE SE PUEDE CONSEGUIR ASISTENCIA LEGAL. CUMBERLAND COUNTY LAWYER REFERRAL SERVICE Cumberland County Bar Association 2 Liberty Ave Carlisle, PA 17013 (717) 249-3166 GOLDBERG, KATZMAN & SHIPMAN, P.C. Thomas J. Weber, Esquire Attorney I. D. # 58853 David M. Steckel, Esquire Attorney I. D. # 82340 Attorneys for Defendants 320 Market Street P.O. Box 1268 Harrisburg, PA 17108-1268 Telephone: (717) 234.4161 WILLIAM ALBERT WRA Y, JR. andKAYG. WRAY, IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA Plaintiffs, v. CIVIL ACTION - LAW WRA Y'S MUSIC HOUSE, INC., WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, 111, : NO. 00-1960 JURY TRIAL DEMANDED Defendants. ANSWER. NEW MATTER AND COUNTERCLAIM TO PLAINTIFFS' ACTION FOR DECLARATORY RELIEF AND NOW, comes the Defendants, Wray's Music House, Inc., William R. Selosky and Frank Joseph DeStefano, 111, by and through their attorneys, Goldberg, Katzman and Shipman, P .C., who files the following Answer, New Matter and Counterclaim to Plaintiffs' Action for Declaratory Relief: 1. Based upon information and belief, the averments contained in Paragraph 1 of Plaintiffs' Complaint are admitted. 2. Admitted. 'I il 11 !I II '1i 'I 3. Admitted. ,'-.-.-,"-,",,<.-, _ _,_y._, '~"__ _", . ,o",..T_~, ,- -- "-.'''.~' , --- 1"-' -.. ii , II i'! i: :i (, ;i~,!,,__ _ _ 4. Admitted. 5. Admitted. Based on information and belief. 6. Admitted in part; Denied in part. On September 19, 1997, the parties to this matter entered into an agreement, some of the terms of which were reduced to a writing as attached as Exhibit "A" to Plaintiffs' Complaint. By way of further answer, the writing which does not contain an integration clause did not set forth all of the terms of the parties' understanding. 7. Admitted. By way of further answer, at the time of the agreement, he was not an owner ofWray's Music House, Inc. 8. Admitted. By way of further answer, at the time of the agreement, he was not an owner ofWray's Music House, Inc. 9. Denied. Nana Wray DeStefano was not actively involved in negotiating the agreement. By way of further answer, Nana Wray DeStefano, as the only owner ofWray's Music House, Inc. other than the Plaintiffs at the time of the agreement, was a necessary party to any agreement that purports to bind Wray's Music House, Inc. to provide lifetime health insurance coverage. 10. Denied as stated. The "agreement" as relied on by the Plaintiffs was between Plaintiffs and William Selosky and F. J. DeStafano, who were not owners ofWray's Music House, Inc. at the time, and were incapable of contractually binding the company to make the lifetime payment. 11. Admitted. To the extent the averments contained in Paragraph 11 are intended to create an inference these gratuitous payments created any obligation on Wray's Music House, Inc. or the other Defendants to continue the payments indefinitely, such inference is denied. By way of 2 '- ,-,-, ~~ - "~ ,-- --' - .-" -,' ~ -, - -". ". , further answer, as of December 1999; Plaintiffs had breached their representation not to open a competing business by running and/or working as Scott Wray Piano Gallery. 12. Admitted in part and denied in part. It is admitted such payments were tendered and Plaintiffs were informed they would not continue. 13. Admitted in part and denied in part. It is admitted the payments were not accepted. As to why Plaintiffs refused to accept them, Defendants do not have a basis to admit or deny these allegations. 14. Denied. The writing, which was drafted by the Plaintiffs, was ambiguous and incapable of binding the corporation to make the claimed payments. 15. Admitted. WHEREFORE, Defendants respectfully request that the court determine the Plaintiffs are 1 I 11 1 -~ ! :1 not entitled to health insurance coverage at the expense of the Defendants. NEW MATTER 16. The averments contained in Paragraph 1 through 15 are incorporated herein as though '1 "_J !l :j , '. set forth in their entirety. 17. Plaintiffs claim is barred by the doctrine of accord and satisfaction. ;, 18. Plaintiffs claim is barred for failure of consideration. :~ ,1 ,~ , , 19. Termination of the gratuitous health insurance payments was justified upon Plaintiff , tJ .. William Wray forming a competing business in violation of his promises to the Defendants. 'il l , ,il :i 1 20. Defendants have fully complied with all required obligations under their agreement with the agreement with the Plaintiffs. .:i ,,, '" ;,1 , 21. Plaintiffs have failed to state a claim upon which relief can be granted. :1 .! I 3 ., If, ." ,'~ ,-',._ __0 __ _.,-' , \_, ,~,.,~,__,,_r_' _,_ _ . ~ " .. , ... ., -~ ~ 22. Plaintiffs have violated the terms of the agreements with the Defendants by opening a competing business. 23. The writing was incapable of binding Wray Music House due to the absence of the sole remaining shareholder as a party to the purported agreement. 24. Performance under the agreement is impossible. 25. To the extent it is determined there was an agreementto pay lifetime health insurance proceeds, such agreement was reached under duress. 26. Due to their misrepresentationregarding not opening a competing business, Plaintiffs are estopped from seeking enforcement of the continuation of the gratuitous lifetime health insurance benefits. 27. By opening a competing business and attempting to force Wray' s Music House to pay for his health insurance, Plaintiff is attempting to gain an impermissible, unfair, competitive advantage over Wray's Music House. I.' , , Iii I' ij 1.....1. i Ii...:.... ~I Ii I,. . ~ 28. Any agreement to continue gratuitous payment of Plaintiffs healthcare insurance was specifically premised upon Plaintiff William Wray' s promise he would not compete against Wray' s Music House, Inc. 29. As a result of the misrepresentation made by William Wray regarding his agreement not to open a competing business, there was fraud in the inducement in agreeing to continue the gratuitous payments. 3 O. Defendants did not have the advice of counsel in considering and signing the writing I Il; I:; I'l I' m I: I I. 1'1 y----- prepared by the Plaintiffs. 31. The writing, to the extent it creates an obligation to pay for health insurance, is a 4 ~_ __ ,~ ~_"u_ __ _,,_, _ _ ,0_ _, ,_,_.,__ "no . - .,~. . " - ~- contract of adhesion. 32. There was not the requisite meeting of the minds to render any obligation to pay for health insurance binder. WHEREFORE, Defendants respectfully request the court determine the Plaintiffs are not entitled to health insurance coverage at the expense of the Defendants. COUNTERCLAIM WRAY'S MUSIC HOUSE. INC.. WILLIAM R. SELOSKY AND FRANK JOSEPH DESTEFANO. III. v. WILLIAM ALBERT WRAY, JR. RECISION 33. The averments contained in Paragraphs 1 through 32 are incorporated herein as though set forth in their entirety. 34. Plaintiffs William Albert Wray, Jr., and Kay Wray orally agreed, as a condition and substantial contributing factor to Defendants' agreement to purchase Plaintiffs' shares of stock in Wray's Music House, Inc., that they would refrain from owning, operating or otherwise obtaining any interest in a competing business in the CumberlandJDauphin County area. I ,1 , 35. In the fall of 1999, William Wray violated his promise by opening Scott Wray Piano Gallery in New Cumberland, P A. 36. By opening Scott Wray Piano Gallery, William Wray directly competes with Defendants, Wray Music House. 37. It is believed and therefore averred Kay Wray works at, and provides substantial assistance to Scott Wray Piano Gallery. 5 1 I ':':: ~ .,-- --, _= c ',,~, "-' -_~'__ '" ,. 'i' .'_ , -,-,---, ..,.... '. - -~~., 1 ~1 ;1 'I il I '! ~j II \"l'l 38. Plaintiffs' misrepresentations regarding their not competing against Wray's Music House, fraudulently induced the individual Defendants to sign the writing prepared by the Plaintiffs. WHEREFORE, Defendants respectfully request that this Honorable Court enter judgment in their favor and against the Plaintiffs rescinding that portion of the agreement requiring lifetime payment of health insurance, attomeys' fees, costs, interest and all other relief the Court deems just. Respectfully submitted, & SHIPMAN, P.C. ~ERG, By: Tho as J. We r, Esquire Supr. J.D. #58853 David M. Steckel, Esquire Supr. J.D. #82340 320 Market Street P. O. Box 1268 Harrisburg, P A 17108-1268 (717) 234"4161 Attorneys for Defendants Date: May 26, 2000 6 -,- "-"-""" ," _ _ ",_. _ ~, ~h _ ". 'n'-- :hursday, May 25.200010:22 AM Keyboards 0000000 p.02 P.t; !'.1AY 24 ' C,0 03: 2'6PI"1 (;1<3 VEIUFICATION I, WILLIAM R. SELOSKY, ofWray's Music House, Inc., hereby veritY that 1 have read the foregoing Answer, Now Matter, Counterclaim and Third Party Complaint; and that the facts stated therein are true and correct to the best ormy knowledge, infonnation, and belief. I understand that any false statements herein are made subject to penalties of 18 Pa. C.S. ~4904 relating to unsworn falsification to authorities. WRA Y'S MUSIC HOUSE, INC. 1# William R. Selosky - By: 8 ThU'rsday, May 25, 2000 10:22 AM Keyboards 0000000 p.03 I'IRY' 24 .. eo 03' 27F'i'I GI,S P.9 VERIFICATION I, FRANK JOSEPH DESTEFANO, In, ofWray's Music House, Inc., hereby verify that I have read the foregoing Answer and Counterc:laim; and that the facts stated therein are true and correct to the best of my knowledge, infonnation, and belief I understand that any false statements herein are made subject to penalties of 18 Pa. C. S. ~4904 relating to unsworn :f8Isi1ication to authorities. WRAY'S MUSIC BOUSE, INC. B" """"~ __ ~ '-, . ~- CERTIFICATE OF SERVICE 1 hereby certify that I am this date serving a copy of the foregoing document upon the person(s) and in the manner indicated below, which service satisfies the requirements of the Pennsylvania Rules of Civil Procedure, by depositing a copy of same in the United States Mail, Harrisburg, Pennsylvania, with frrst-class postage, prepaid, as follows: R. Mark Thomas, Esquire 101 South Market Street Mechanicsburg, P A 17055 GOLDBERG, KATZMAN & SHIPMAN, P.C. By: ~,~~ Attorney l.D. #58853 320 Market Street P. O. Box 1268 Harrisburg, PA 17108-1268 (717) 234-4161 Attorneys for Defendants Dated: May 26, 2000 7 '..1. " ['i [I , II I ". ,~ - .^. < .-.,. , ---~.~ ,.' ~, ,-. rl ." _. --~,~ 0- ~ . _ ~ ,~-",,?- " " ,,"'''' -~-~"""'''''''~~;, ~"-" ,"-, "" "-"'"--.. g = 0 0 "Tl. ~ ::l: it -om > men -< 2,-'1 j., N &.is:-: 0' ~6 -0 ~O :x "'"7,0 0 - c"3.-n >>c .. -j ~ .". :0 N -< 7~ _P!1__1~,1'" SHERIFF'S RETURN - REGULAR ~ CASE NO: 2000-01960 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND WRAY WILLIAM ALBERT JR VS WRAY'S MUSIC HOUSE INC ET AL RICHARD SMITH , Sheriff or Deputy Sheriff of Cumberland County, pensylvania, who being duly sworn according to law, says, the within NOTICE & ACTION was served upon WRAY'S MUSIC HOUSE INC the RESPONDANT , at 0015:40 HOURS, on the 24th day of April 2000 at 326 MARKET STREET LEMOYNE, PA 17043 by handing to WILLIAM R. SELOSKY & FRANK JOSEPH DESTEFANO a true and attested copy of NOTICE & ACTION together with FOR DECLARATORY RELEIF and at the same time directing His attention to the contents thereof. Sheriff's Costs: Docketing Service Affidavit Surcharge 18.00 9.92 .00 10.00 .00 37.92 S;:'li? ~K~! R. Thomas Kline 04/25/2000 R. MARK THOMAS Sworn and Subscribed to before By: me this ~~4 day of ;fl'~.... , SHERIFF'S RETURN - REGULAR .- - CASE NO: 2000-01960 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND WRAY WILLIAM ALBERT JR VS WRAY'S MUSIC HOUSE INC ET AL RICHARD SMITH , Sheriff or Deputy Sheriff of Cumberland County, Pensylvania, who being duly sworn according to law, says, the within NOTICE & ACTION was served upon SELOSKY WILLIAM R the RESPONDANT , at 0015:40 HOURS, on the 24th day of April , 2000 at 326 MARKET ST LEMOYNE, PA 17043 by handing to WILLIAM R. SELOSKY a true and attested copy of NOTICE & ACTION together with FOR DECLARATORY RELEIF and at the same time directing His attention to the contents thereof. Sheriff's Costs: Docketing Service Affidavit Surcharge 6.00 .00 .00 10.00 .00 16.00 S?~~t R. Thomas Kline 04/25/2000 R. MARK THOMAS Sworn and Subscribed to before By: me this ~<rC\.. day of J.t;rri) I'"""" ~........"'_ - SHERIFF'S RETURN - REGULAR . . CASE NO: 2000-01960 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND WRAY WILLIAM ALBERT JR VS WRAY'S MUSIC HOUSE INC ET AL RICHARD SMITH , Sheriff or Deputy Sheriff of Cumberland County, Pensylvania, who being duly sworn according to law, says, the within NOTICE & ACTION was served upon DESTEFANO FRANK JOSEPH III the RESPONDANT , at 0015:40 HOURS, on the 24th day of April , 2000 at 326 MARKET ST LEMOYNE, PA 17043 by handing to FRANK DESTEFANNO, III a true and attested copy of NOTICE & ACTION together with FOR DECLARATORY RELEIF and at the same time directing His attention to the contents thereof. Sheriff's Costs: Docketing Service Affidavit Surcharge 6.00 .00 .00 10.00 .00 16.00 So ;;~~, R. Thomas Kline 04/25/2000 R. MARK THOMAS Sworn and Subscribed to before By: me of . - ,-~^' Plaintiffs IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA NO. OO-l q&OCIVILTERM WILLIAM ALBERT WRA Y, JR. and: KAY G. WRAY, v. WRA Y'S MUSIC HOUSE, INC. WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, III, Defendants NOTICE YOU HAVE BEEN SUED IN COURT. If you wish to defend against the claims set forth in the following pages, you must take action within twenty (20) days after this complaint and notice are served, by entering a written appearance personally or by attorney and filing in writing with the court your defenses or objections to the claims set forth against you. You are wamed that if you fail to do so the case may proceed without you and a judgment may be entered against you by the court without further notice for any money claimed in the complaint or for any other claim or relief requested by the plaintiff. You may lose money or property or other rights important to you. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP. CUMBERLAND COUNTY BAR ASSOCLATION 2 LffiERTY AVENUE CARLISLE, PENNSYLVANIA 17013 TELEPHONE: (717)-249-3166 WILLIAM ALBERT WRA Y, JR. and: KAY G. WRAY, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA Plaintiffs NO. OO....:\Ct/.oD CIVIL TERM v. WRA Y'S MUSIC HOUSE, INC. WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, III, Defendants ACTION FOR DECLARATORY RELIEF AND NOW, come the plaintiffs, William AlbertWray, Jr. and Kay G. Wray, by and through counsel R. Mark Thomas, Esquire and bring this action for Declaratory Relief and in support thereof respectfully represent: 1. Plaintiffs William Albert Wray, Jr. and Kay G. Wray are husband and wife and currently reside at 91 Skyline Drive, Mechanicsburg, Cumberland County, Pennsylvania. 2. Defendant Wray's Music House, Inc. is a corporation organized and existing under the laws of Pennsylvania with its principal place of business at 326 Market Street, Lemoyne, Cunlberland County, Pennsylvania. 3. Defendant Frank Joseph DeStefano, III is an adult individual who resides at 421 Allendale Way, Camp Hill, Cumberland County, Pennsylvania and is a current shareholder in Wray's Music House, Inc. 4. Defendant William R. Selosky is an adult individual who resides at 21 Drexel Place, New Cumberland, Cumberland County, Pennsylvania and is a current shareholder in Wray's Music House, Inc. ':i: 5. Prior to September 19, 1997, plaintiffs owned shares of stock in Wray's Music House, Inc., in their own right and were the named beneficiaries of other shares of stock in Wray's Music House, Inc., then owned by the Estate of Nana E. Wray. 6. On September 19, 1997, plaintiffs entered into a written agreement to sell all their shares of stock in Wray's Music House, Inc. to respondents William R. Selosky and Frank Joseph DeStefano, III for an agreed upon consideration. A copy of that written agreement is attached hereto and incorporated herein as Petitioners' Exhibit "A". 7. On the date of execution of this written agreement defendant William R. Selosky was President of Wray's Music House, Inc. and general manager of Wray's Music House, Inc., a retail music store. 8. On the date of execution of this written agreement defendant Frank Joseph DeStefano, III was the natural bom son of Nana Wray DeStefano, the sole remaining owner of shares of stock in Wray's Music House, Inc. 9. Although not a signatory to the written agreement, Nana Wray DeStefano was actively involved in the negotiations as to the consideration to be paid to plaintiffs for the transfer of plaintiffs ownership interests in Wray's Music House, Inc. to defendants William R. Selosky and Frank Joseph DeStefano, III. 10. Part of the consideration to be paid to plaintiffs in exchange for the transfer of their ownership interest in Wray's Music House, Inc., was that Wray's Music House, Inc. would provide health insurance and/or pay premiums for health insurance for the benefit of plaintiffs, and their children under certain conditions, for the remainder of plaintiffs' lives. "~-"C''"f"?'" 11. Defendant Wray's Music House, Inc. did pay for plaintiffs' health insurance from September 19, 1997 up through and including December 1999. 12. Defendant Wray's Music lc!ouse, Inc. attempted to pay plaintiffs' health insurance premiums for January 2000 through March 2000, but conditioned that payment upon plaintiffs' acceptance of that payment as the final payment for health insurance to be made by defendants under the terms of the September 19, 1997 agreement. 13. Plaintiffs refused to accept the last payment under the terms demanded by defendants. 14. Defendants' actions have created uncertainty and insecurity with respect to the rights of plaintiffs under the written agreement dated September 19, 1997. 15. A controversy now exists as to the rights and responsibilities of the parties hereto nnder the written agreement dated September 17, 1997. WHEREFORE, plaintiffs pray this Honorable Court will grant declaratory relief in the form of declaring the rights and responsibilities of all parties bound by the written agreement of September 17, 1997, as well as assign the costs of this action to the appropriate party. Respectfully submitted, ~ R. Mark Thomas, Esquire Attomey for Petitioners 101 South Market Street Mechanicsburg, P A 17055 (717)796-2100 10# 41301 , .. This is a sales agreement that will be legally binding in a court of law for the buyout of WRAY'S MUSIC HOUSE, INC. shares of stock from William Albert Wray, Jr., and Kay G. Wray including shares to be inherited from the Nana E. Wray estate. William R. Selosky and Frank Joseph DeStefano, III agree to purchase all shares of WRAY'S MUSIC HOUSE, INC. from william Albert Wray, Jr. and Kay G. Wray including inherited stock from the Nana E. Wray estate at the asking price of $100,000.00. This is contingent on obtaining the financing from an outside source. The followin9 issues are also to be dealt with in the manner in Wh1Ch they are described below: I. The Corporate debt that is due to william Albert Wray, Jr. and Kay G. Wray for the use of their home equity line of credit by WRAY'S MUSIC HOUSE INC., in the amount of $37,870.59 will be paid in full at the time of the buyout of their shares of stock. A loan for the repaying the Corporate Notes that are due to their children, william Albert Wray, III and Jessica Leigh Wray, each in the amount of $40,000.00 (total of $80,000.00) will be secured when the loan for the buyout of the shares is repaid to the institution that financed the loan to William R. Selosky and Frank Joseph DeStefano, III, and also the loan that was obtained by WRAY'S MUSIC HOUSE, INC. to repay William Albert wray, Jr. and Kay G. Wray for the use of their home equity 11ne of credit. At that time it is the intention that all the Corporate Notes that are due to Pamela Wray Destefano, Frank Joseph DeStefano, William Matthew DeStefano, and Nana Wray DeStefano will be ~aid. Until this loan is secured interest will contlnue to paid at an annual percentage rate of 8%. II. Health Insurance will be paid in full by WRAY'S MUSIC HOUSE, INC. for william Albert Wray, Jr. and Kay G. Wray for the rest of their lives. This coverage will also include their children, William Albert Wray, III and Jessica Leigh Wray under the following conditions: a. They go through 4 consecutive years in undergraduate studies b. They go through an additional 4 consecutive years post-graduate studies immediately following undergraduate studies c. Coverage will cease upon marriage in either lIa or lib III. Starting September 8, 1997, Kay G. Wray will be withdrawn from receiving salary payments and will be paid by the hour during this transition time. Hours will be determined by William R. Selosky and Frank Joseph DeStefano. Hourly rate will be determined by dividing her salary by the hours that she worked ($850.00 - 66 hrs = $12.88 per hour). William Albert Wray, Jr., will stop receiving any and all salary from WRAY'S MUSIC HOUSE, INC. effective the date the check for the buy-out is received by William A. Wray, Jr. EXHIBIT "A" '" -'--~-, ,'- This is a sales agreement that will be legally binding in a court of law for the bUr out of WRAY'S MUSIC HOUSE, INC. shares of stock from Will1am Albert Wray, Jr., and Kay G. Wray including shares to be inherited from the Nana E. Wray estate. William R. Selosky and Frank Joseph DeStefano; III agree to purchase all shares of WRAY'S MUSIC HOUSE, INC. from William Albert Wray, Jr. and Kay G. Wray including inherited stock from the Nana E. Wray estate at the asking price of $100,000.00, This is contingent on obtaining the financing from an outside source. We the undersigned agree that it is with sound mind and without mental duress that we are agreeing to the above terms and conditions. ~ .-21 . 1am . . os y September 19, 1997 III September 19, 1997 W1 September 19, 1997 ,) Q i'-{LL~ d'yt hLLlt Kay G Wray September 19, 1997 , ~ i -,,4"" -<, ..,-, -~,- '." , ,".""'1,.!!lt""",~_.,i:l1llllI!i! -, ..1 ~. -""-"r'" ,'" 1-- ~,--" " - ~, ~~, , ~_ '"U" ~~=- ~~ """,;..,"'_><'-',~o _ "'''' C) CI ~ 0 ."",." " '-'., :~'8 --..-, IT: iT, '=-~.J "'7 "L! -. ~ 2: i" ,-,-, -'"e- Ll :::;; ~: ' , ----;-, ~!.,,: 5~ c r'_) -' C - .; ~ :c:J -< , 0 -<C ".' ~,.."~,;~1I~"\"""'-'~~I\l'l~iI!iiml!l~~IjIj~m,,,,,,_,,,,"'~I'l'_~~1 , .' WILLIAM ALBERT WRA Y, JR. andKAYG. WRAY : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, PENNSYLVANIA V. WRAY'S MUSIC HOUSE, INC. : NO. 2000-1960 CML tERM WILLIAM R. SELOSKY and FRANK JOSEPH DE STEFANO, ill ORDER OF COURT AND NOW, this 4TH day of APRIL, 2000, the "Petition for Declaratory Judgment" is denied without prejudice. Petitioners are directed to comply with Pa. Rule of Civil Procedure 1601 et seq. Edward E. Guido, J. :sld ~ 00 . ~. ~<) ~7 ~ R. Mark Thomas, Esquire For the Petitioners/Plaintiffs ,~~ " - - -. ~, .,~ c,_ ~ , " . ~ ,- " " V!N\flllASNN:Jd ALNnO:) O[\}\h,~}3SWno 8,...r I'''' .:J ,()' '" ~1 , 'I'" "'" 1 i ~ hI (" :J-(Jd~tJG ^HV1C:i~i~jA:;~~J:}]ii i;l(J I .. ""- .... r' ,. ;""-<,, "'"'"J .u.' W~t:(i~~~~j~1!i _ ,"'1I'J!!_~..,....",~'! WILLIAM ALBERT WRAY, JR. and: KAYG.WRAY, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA Petitioners NO. {}1J -Jq~o CIVIL TERM v. WRAY'S MUSIC HOUSE, INC. WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, III, Respondents RULE RETURNABLE AND HEARING THEREON AND NOW, this day of , 2000, a Rule is issued upon the respondents to show cause, if any, as to why the relief requested should not be granted. Rule Returnable within ten (10) days following service of the Petition upon the respondents, and hearing thereon to be held on the day of ,2000, in Courtroom No. , at o'clock a.m./p.m. in the Court of Common Pleas, Cumberland County, Carlisle, Pennsylvania. Service of this Petition may be made by certified mail, return receipt requested on the respondents or by service upon the attorney for the respondents if the attomey accepts service of same. By the Court, J. ~~r.!lII!"!f nO"_ ~J: Petitioners IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY , PENNSYLVANIA CIVIL TERM NO. (H; - /q(,o WILLIAM ALBERT WRAY, JR. and: KAYG.WRAY, v. WRAY'S MUSIC HOUSE, INC. WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, III, Respondents PETITION FOR DECLARATORY JUDGMENT . AND NOW, come the Petitioners, William Albert Wray, Jr. and Kay G. Wray, by and through cOUJIsel R. Mark Thomas, Esquire to Petition this court for Declaratory Relief as follows: 1. Petitioners William Albert Wray, Jr. and Kay G. Wray are husband and wife and currently reside at 91 Skyline Drive, Mechanicsburg, Cumberland County, Pennsylvania. 2. Respondent Wray's Music House, Inc. is a corporation organized and existing under the laws of Pennsylvania with its principal place of business at 326 Market Street, Lemoyne, Cumberland County, Pennsylvania. 3. Respondent Frank Joseph DeStefano, III is an adult individual who resides at 421 Allendale Way, Camp Hill, Cumberland County, Pennsylvania and is a current shareholder in Wray's Music House, Inc. 4. Respondent William R. Selosky is an adult individual who resides at 21 Drexel Place, New Cumberland, Cumberland County, Pennsylvania and is a current shareholder in Wray's Music House, Inc. ~ 5. Prior to September 19, 1997, petitioners owned shares of stock in Wray's Music House, Inc., in their own right and were the named beneficiaries of other shares of stock in Wray's Music House, Inc., then owned by the Estate of Nana E. Wray. 6. On September 19, 1997, petitioners entered into a written agreement to sell all their shares of stock in Wray's Music House, Inc. to respondents William R. Selosky and Frank Joseph DeStefano, III for an agreed upon consideration. A copy of that written agreement is attached hereto and incorporated herein as Petitioners' Exhibit "A". 7. On the date of execution of this written agreement respondent William R. Selosky was President of Wray's Music House, Inc. and general manager of Wray's Music House, Inc., a retail music store. 8. On the date of execution of this written agreement respondent Frank Joseph DeStefano, III was the natural born son of Nana Wray DeStefano, the sole remaining owner of shares of stock in Wray's Music House, Inc. 9. Although not a signatory to the written agreement, Nana Wray DeStefano was actively involved in the negotiations as to the consideration to be paid to petitioners for the transfer of their ownership interests in Wray's Music House, Inc. to respondents William R. Selosky and Frank Joseph DeStefano, III. 10. Part of the consideration to be paid to petitioners in exchange for the transfer of their ownership interest in Wray's Music House, Inc., was that Wray's Music House, Inc. would provide and pay for health insurance for the benefit of petitioners, and their children under certain conditions, for the remainder of petitioners' lives. . ~ ~ 11. Wray's Music House, Inc. did pay for petitioners' health insurance from September 19, 1997 up through and including December 1999. 12. Wray's Music House, Inc. attempted to pay petitioners' health insurance premiums for January 2000 through March 2000, but conditioned that payment upon petitioners acceptance of that payment as the final payment for health insurance to be made by Wray's Music House, Inc. under the tenus of the September 19, 1997 agreement. 13. Petitioners refused the last payment under the tenus demanded by respondents. 14. Respondents' actions have created uncertainty and insecurity with respect to the rights of petitioners under the written agreement dated September 19, 1997. 15. A controversy now exists as to the rights and responsibilities of the parties hereto under the written agreement dated September 17, 1997. WHEREFORE, petitioners pray this Honorable Court will grant declaratory relief in the fonu of declaring the rights and responsibilities of all parties bound by the written agreement of September 17, 1997, as well as assign the costs of this action to the appropriate party. Respectfully submitted, &~ R. Mark Thomas, Esquire Attorney for Petitioners 101 South Market Street Mechanicsburg, P A 17055 (717)796-2100 ID# 41301 ~ . - MAR, -27' 00 IMON) 12:05 R, MARK THOMAS, ESQ, TEL:?l7 796 3600 p, 002 . VERIFICATION We vetify that the statements made in the foregoing document are we and correct. We understand that false statements herein are made su~ect to the penalties of 18 Pa, C.S. 14904, relating to umwom falsification to authorities, Date: 3 /2-..,/00 Date: lJ);).1 ( ~ J\0lt)1< It~ ~~ - - - "~ ~, ;,~ fr ~ '<) ~ " ~ , ~ . ,. .- ,.1, ~~~f" ~, ,~., I!~~'~' 1<..' >"d 'I" .,. 0, ,~-,,~.. (') C ? -cir~ ~,g~;:-, i~~.. V#-'<':-" ;;,,,,~ <(:..: :2:;("', Z", ~?() Pc.:: 2: =< '" '0 . '-'.. .~ <;:;> o ~ 'D.lo.. ~ ~""" (.n <:::> (') ..,., ::.:J :-:17J ,- '-'0;:9 ~~(S ~S ;&)' --<:,' "- din ~.,,~ 55 -< -0 ::r ~~ ~ ~ j '" .. I" ~ ~ '!\ ~I '0 e v d ~ ~ _,~!1l'lE~11fflIi'M',i"~)~"~;;<@\jr>l~~~!II!II~~'~_~lMflJlt~!~ , Thomas J. Weber, Esquire LD. #58853 GOLDBERG, KATZMAN & SHIPMAN, P.C. 320 Market Street P. O. Box 1268 Harrisburg, PA 17108-1268 (717) 234-4161 Counsel for Defendants Plain tiffs IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA WILLIAM ALBERT WRAY, JR., and KAY G. WRAY, v. CIVIL ACTION - LAW WRAY'S MUSIC HOUSE, INC., WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, III, Defendants NO. 00-1960 JURY TRIAL DEMANDED DEFENDANTS' REQUEST FOR RECONSIDERATION Now, comes the Defendant Wray's Music House and respectfully requests Reconsideration ofthe Court's Order of December 14, 2001, and in support of the same asserts the same: 1. This case was tried before the Honorable Edward F. Guido on Friday, December 14, 2001. 2. Following the one-day bench trial, the Court dictated an Order of the same date. A true and correct copy of the Court's Order is attached hereto as Exhibit A. 3. Defendant Wray's Music House asks for reconsideration and/or clarification of the Court's Order only as far as it orders that the Plaintiffs be Iii r/ ,- 7~,'<"i>=_",~ ~". "i- _ - ,. , _ - ._, _co,_'," - .", - ~. . provided insurance "comparable to the best health insurance plan provided for any of [Wray's Music House, lnc.'s] employees." 4. The uncon tradicted evidence in this case establishes that the Plaintiffs were the scriveners of the Sales Agreernent that formed the basis of this declaratory judgrnent action. See copy of Sales Agreernent attached hereto as Exhibit B. I II u ~ ~ Ii i r I f i I II 11 II I' I I I I I , 5. The uncontradicted evidence in this case also established that during negotiations for the sale ofthe business, Plaintiffs had dernanded that they remain on the health insurance policy of the company for the rest of their lives. See Plaintiffs' Trial Exhibit 2 attached hereto as Exhibit C. 6. Plaintiffs modified the terms of the proposal by dropping the requirernent that they remain on the Defendant's policy. 7. There is insufficient evidence to support a determination that Defendant agreed to provide health insurance "comparable to the best insurance offered to its employees". 8. As the scriveners of the documents in question, it should be strictly construed against them. 9. At the conclusion of the trial, the Court indicated that it found that Plaintiff William Wray had rnade certain representations to the Defendants to induce them to enter into the agreement. 2 Ll:..'''''" ',_,_~~,_' ___r..,,~_:_ '~" _,;"",,_, ,_," _.'~ .d., ',n_ --',- '-,-- ~, " '" , 10. The Court further found that the Plaintiff has violated those representations. 11. Any agreement as to the type of insurance to be offered was clearly limited to Plaintiffs' representations that they would not compete against the Defendant. 12. Having breached those representations, the Plaintiffs should at least be required to adhere to the strict language of the document they drafted. 13. The document at most requires the providing of health insurance. 14. Any ambiguity in the document drafted by the Plaintiffs should not now enure to their benefit so as to require better insurance than that set forth in the agreement. 15. Due to their disassociation with the Defendant, Plaintiffs cannot be maintained on the company's health insurance. 16. Strict adherence to the Court's Order would require the Defendants to pay more for the health insurance provided to the Plaintiffs than it pays for its own loyal employees. WHEREFORE, Defendant Wray's Music House respectfully request that the Court reconsider its Order of December 14, 2001, and find that the 3 I, I ~ , f',._, '-. "',,",.- --~'t ",,__ ,~ ""_:;;,~,c~"' H "",",,_":""','!',""_-'-_~'_'~'_' ,':. _',o__ ":::">:""'~_"_ '''t''~'' ' ," c. . . --~-,,~,~~-- ""~",'-,- ,>.".. Defendant's only obligation is to provide Plaintiffs with "health insurance" as specifically set forth in the Agreement under consideration. Respectfully Submitted, Date: f -} '1- 02 By Thornas J. W . er, Esq. Goldberg, Katzman & Shipman 320 Market Street P.O. Box 1268 Harrisburg, PA 17108-1268 Attorneys for Defendants 73639.1 4 11::.". ',n, ,. ','\,:!c-'(\';"c-i1,o~,",-"; _C',,,",_ '. '_, -' "0 ~""C~",,_' '>-'_~5'_"," __" H '^~',_~____o" '-<_'_,""'r"~___ ,_~_"_"",,,y_ ~< . WILLIAM ALBERT WRAY, JR., and KAY G. WRAY, Plaintiffs IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA v. CIVIL ACTION - LAW WRAY'S MUSIC HOUSE, INC., WILLIAM R. SELOSKY and FRANK JOSEPH DeSTEFANO, III,: Defendants NO. 00-1960 CIVIL TERM ORDER OF COURT AND NOW, this 14th day of December, 2001, after hearing, it is ordered and directed that, pursuant to the sale and purchase of Plaintiffs' stock, the Defendant, Wray's Music House, Inc., has the obligation to provide health insurance for William Albert Wray, Jr., and Kay G. Wray. It is further ordered and directed that the individual Defendants have no such obligation. The insurance provided shall be comparable to the best health insurance plan provided for any of its employees. Should Plaintiffs elect a different health plan, Defendant shall reimburse them monthly in an amount equal to the cost of the health insurance it would otherwise be obligated to provide. This obligation to be in effect during any period that Defendant provides health insurance for any of.its employees while either William Albert Wray, Jr., or Kay G. Wrayare living. The Defendant is directed to reimburse Plaintiffs, in accordance with the terms of this order, for any unpaid health insurance premiums. Edward E. Guido,J. ~~ ~. o~" ' -. ~ . , . , ~~ This is a sales agreement that will be legally binding in a court of law for the bur out of WRAY'S MUSIC HOUSE, INC. shares of stock from Wil11am Albert Wray, Jr., and Kay G. Wray including shares to be inherited from the Nana E. Wray estate. William R.. Selosky and Frank Joseph DeStefano, III agree to purchase all shares of WRAY'S MUSIC HOUSE, INC. from William Albert Wray, Jr. and Kay G. Wray including inherited stock from the Nana E. Wray estate at the asking price of $100,000.00. This is contingent on obtaining the financing from an outside source. The followin~ issues are also to be dealt with in. the manner in Wh1Ch they are described below: I. The Corporate debt that is due to William Albert Wray, Jr. and Kay G. Wray for the use of their home equity line of credit by WRAY'S MUSIC HOUSE INC., in the amount of $37,870.59 will be paid in full at the time of the buyout of their shares of stock. A loan for the repaying the Corporate Notes that are due to their children, william Albert Wray, III and Jessica Leigh Wray, each in the amount of $40,000.00 (total of $80,000.00) will be secured when the loan for the buyout of the shares is repaid to the institution that financed the loan to William R. Selosky and Frank Joseph DeStefano, III, and also the loan that was obtained by WRAY'S MUSIC HOUSE, INC. to repay William Albert Wrar, Jr. and Kay G. Wray for the use of their home.equity Ilne of credit. At that time it is the intention that all the Corporate Notes that are due to Pamela Wray DeStefano, Frank Joseph DeStefano, William Matthew DeStefano, and Nana Wray DeStefano will be ~aid. until this loan is secured interest will cont1nue to paid at an annual percentage rate of 8%. II. Health Insurance will be paid in full by WRAY'S MUSIC HOUSE, INC. for William Albert Wray, Jr. and Kay G. Wray for the rest of their lives. This coverage will also include their children, William Albert Wray, III and Jessica Leigh Wray under the following conditions: a. They go through 4 consecutive years in undergraduate studies b. They go through an additional 4 consecutive . years post-graduate studies immediately following undergraduate studies c. Coverage will cease upon marriage in either #a or #b . III. Starting September 8, 1997, Kay G. Wray will be withdrawn from receiving salary payments and will be paid by the hour during this transition time. Hours will be determined by William R. Selosky and Frank Joseph DeStefano. Hourly rate will be determined by dividing her salary by the hours that she worked ($850.00 - 66 hrs = $12.88 per hour). William Albert Wray, Jr., will stop receiving any and all salary from WRAY'S MUSIC HOUSE, INC. effective the date the check for the buy-out is received by William A. Wray, Jr. PLAINTIFPS EXHIBIT . EXHIBIT "A" #/ "~ " , This is a sales agreement that will be legally binding in a court of law for the buyout of WRAY'S MUSIC HOUSE, INC. shares of stock from Wil11am Albert Wray, Jr., and Kay G. Wray including shares to be inherited from the Nana E. Wray estate. William R. Selosky and Frank Joseph DeStefano, III agree to purchase all shares of WRAY'S MUSIC HOUSE, INC. from William Albert Wray, Jr. and Kay G. Wray including . inherited stock from the Nana E. Wray estate at the asking price of $100,000.00. This is contingent on obtaining the financing from an outside source. We the undersigned agree that it is with sound mind and without mental duress that we are agreeing to the above terms and conditions. L~fj~ . .-~1 l1am. os y September 19, 1997 III September 19, 1997 W1 September 19, 1997 \&l~ h'yt"LLL~ Kay G Wray ,) september 19, 1997 L. .',- ~- ,,'.. ~-T- . , <. ." -" ,< BUY OUT OF WRAY MUSIC HOUSE, INC. INTEREST AND SHARES FROM WA WRAY, JR. AND KAY G. WRA Y I. STOCK PURCHASE: $100.000. A Purchased by Betsy and F.J. Betsy and F. J. would then have 100% ownership and control of Wray's Music House, Inc. B. Purchased by F. J. and Bill Selosky Betsy would then have 50'Yo ownership F. J.'andBill Selosky would each have 25%. ownership Betsy and F.J. wonld have retain a majority ownership and control of Wl\IlH ( 75% combined ownership and control) C. Payment in 1'1111 would be at time of buy-out. 11. CORPORATE NOTES: $.120,000. A CorpoTnte noles due to WA Wray, III ($40,000.00) J.L. Wray ($40,000.00) WA Wray, Jr ($40,000.00) Will be paid to them in full at time of buy-out III LEASES -~ I A A fair market value lease wil1 be drawn up between DWM Properties and WMH. B A lhir market value lease will be drawn up between WI'vfH Partnership and WMH Sheet Music Deparlment IV LlFE TIME HEALTH INSURANCE A. W.A and KG. Wray, Jr will remain on the health care policy for the rest of their lives. W.A. and J. L Wray will be covered until out of college. V HOURLY RATE A Kay will remain through the transition. ,or.as long as. WMH Board desir~, at an hourly rate to be detenllined at time ofbllY out. VI. TIME FRAME A This buyout offer will expire 9/30/97. Upon acceptance and completion of this proposal Bill and Kay would no longer have any shares or interest in the business. Nor would they be part of the daily or overal1 business decisious. It would be advantageous for WMH if they would offer Kay's position to Kristy. She would be more than capable of handling this position and would be a great asset to WI'vfH 6/27/97 PLAINTIFPS EXHIBIT +r:';) ,< ., "~. CERTIFICATE OF SERVICE I hereby certifY that I am this date serving a copy of the foregoing document upon the person(s) and in the manner indicated below, which service satisfies the requirements of the Pennsylvania Rules of Civil Procedure, by depositing a copy of same in the United States Mail, Harrisburg, Pennsylvania, with first-class postage, prepaid, as follows: R. Mark Thomas, Esquire 10 1 South Market Street Mechanicsburg, PA 17055 GOLDBERG, KATZMAN & SHIPMAN, P.C. By: ;.h~~~~ Attomey J.D. #58853 320 Market Street P. O. Box 1268 Harrisburg, PA 17108-1268 (717) 234-4161 Attomeys for Defendants Date: t -rL{.O L i jt,.'"" , -''0'-- ,_, ~" __'-0 .,,"" ". "- - '-' <~ ,-',"~-- - .--, . -- ~ "~- ~. .- )" - ,~, ~-, ~, ~, 1- . ,. W-~_!flUL,"",,:_ ,~ ~- "", '. - 8 c-:: 0 r-..:, Ul'< ? u -.,--, Q,' , , (I~:' . j'- ,. ~- , f:-= ~"'D ~--i ....,.--~ ; C) .,.-. .- ni ::to"~ :"0 ~- 'I ~, ~"::-: .......) >... -., -"., ~. .-< . 0 -< " "....-. ,-.- ""!'I"'" !1I'"l~