Document:

PROMISSORY NOTE

$3,200,000                                                      March 26, 1999

         FOR  VALUE  RECEIVED,  Yoshikazu  Masayoshi,  Sadao  Masayoshi,  Sachie
Masayoshi and Kazuaki Masayoshi (jointly and severally,  the "Maker") promise to
pay to the order of Aura Systems,  Inc. (the "Initial  Payee") Three Million Two
Hundred  Thousand  Dollars  ($3,200,000.00)  at 2335 Alaska Avenue,  E1 Segundo,
California  90245 or such other address as the Initial  Payee or any  subsequent
holder of this Note  (the  holder  from  time to time  being  the  "Payee")  may
designate  from time to time,  together with  interest in  accordance  with this
Note.

         1.  Payment.  Principal  and  interest  shall be payable in twelve (12)
equal monthly installments of $290,000.00 commencing May 15, 1999 and continuing
on the first business day of each month thereafter.

         2.  Prepayment.  The Maker may prepay this Note in whole at any time by
paying  the  full  amount  of all  installments  remaining  unpaid  (that is (i)
$290,000.00   multiplied  by  (ii)(x)  twelve  (12)  minus  (y)  the  number  of
installments previously paid), and may not otherwise prepay this Note.

         3.       Default.

                  3.1 Acceleration. If any "Default" (as defined in section 3.2)
shall  occur,  including  the  expiration  of any grace  period  provided for in
section 3.2, then,  without further demand or notice,  the entire unpaid balance
of principle and interest pursuant to this Note shall become immediately due and
payable,  and the Payee shall have all the rights and  remedies  available to it
under applicable law.

                  3.2 Definition.  Thc occurrence of any of the following events
shall constitute a "Default" pursuant to this Note:

                           3.2.1 Thc Maker shall fail to pay any installment due
under this Note within three
(3)  business  days  of its  due  date  or any  check  given  in  payment  of an
installment shall be returned as uncollected; or

                           3.2.2    Any Maker shall make an  assignment  for the
 benefit of his  creditors or admit in writing his inability to pay his debts as
 they become due; or

               3.2.3 Any Maker shall be adjudicated a bankrupt,  or a custodian,
          trustee  or  receiver  shall  be  appointed  for  his  or of  all or a
          substantial part of his property, and such adjudication or appointment
          shall not be  discharged,  vacated or stayed on appeal  within  thirty
          (30)  days;  or  any  court  shall  take  jurisdiction  of  all  or  a
          substantial  part of the  property  of any  Maker  in any  involuntary
          proceeding for the reorganization, dissolution, liquidation or winding
          up of such Maker,  and such proceeding shall not be discharged or such
          jurisdiction relinquished or vacated or stayed on appeal within thirty
          (30) days; or any Maker shall file a petition, or an answer consenting
          to or  acquiescing  in a petition  against him, in bankruptcy or under
          the Federal  Bankruptcy  Code or any similar  law,  state,  federal or
          foreign,  whether now or hereafter existing or any such petition filed
          against  such Maker shall be approved or not vacated or stayed  within
          thirty (30) days.

               3.2.4 A Default  (as defined  therein)  by the Maker  pursuant to
          that  certain  Promissory  Note in the  original  principal  amount of
          $1,000,000 of even date  herewith  payable to the order of the Initial
          Payee.

                  3.3  Post-Default  Interest.  In view of the  acceleration  of
principal  and interest  following a Default,  the Maker shall not be liable for
any additional  accrual of  post-Default  interest from the date of such Default
through May 15, 2000,  the date through which interest on this Note is computed.
If a Default  shall occur and full  payment  has not been made by May 15,  2000,
then,  from and after such date,  the entire  unpaid  balance of  principal  and
interest then due and payable  pursuant to this Note shall accrue  interest at a
rate of 16% per annum,  compounded monthly.  Notwithstanding the prior sentences
of this  section  3.3 or any other  provision  of this Note,  in no event  shall
interest be due or payable or accrued on this Note in excess of the maximum rate
of  interest  permitted  under  applicable  law,  In the event that it should be
determined that the Maker has paid excess interest, such excess shall instead be
treated as a prepayment of principal.

                  3.4 Costs.  The Maker hereby further promises to pay all costs
and expenses  incurred in connection with the collection and  administration  of
this Note,  including,  without limitation,  reasonable attorneys fees and court
costs and special bank charges.

         4.  Collateral.  As security  for this Note,  the Maker has granted the
Payee a security interest in two hundred eighty (280) shares of the common stock
of MYS K.K., as well as certain other  instruments  or  agreements,  pursuant to
that  certain  Escrow  Agreement  among the Maker,  the  Initial  Payee and Wolf
Haldenstein Adler Freeman & HERZ LLP executed simultaneously with this Note, the
terms of which Escrow Agreement are incorporated herein by this reference,

         5.  Set-Offs.  The Maker may not  assert any  deduction  for any claim,
set-off.  disability,  counterclaim or recoupment of any kind whatsoever against
this Note, but must assert the same in a separate action.  The Payee may, at its
option,  withhold  any payment  which it owes at any time to the Maker and apply
such payment against this Note as a prepayment hereof.

         6.  Waiver.  The Maker hereby  expressly  waives  presentment,  demand,
protest,  notice of protest, notice of dishonor and any and all other notices or
demands of whatever  character  to which the Maker might  otherwise be entitled.
Each Maker further  consents to any  extension  granted by any holder as well as
the release of any collateral or any co-Maker and waives notice thereof.

         7.       Governing Law/Consent to Jurisdiction.

                  7.1 Governing Law. This Note has been made and entered into in
the State of  California  and shall be governed by and construed and enforced in
accordance  with the  internal  substantive  laws of the  State  of  California,
without regard to principles of conflicts of laws.

                  7.2 Consent to Jurisdiction.  Each Maker irrevocably  consents
to the  jurisdiction  of the courts of the State of California  (and the Federal
courts  having  jurisdiction  in the State of  California)  for  purposes of any
judicial  proceeding  which may be  instituted  in  connection  with any  matter
arising under or relating to this Note.

         8. Notices. Any notice required or permitted under this Note must be in
writing  and shall be  considered  given when  delivered  personally  or sent by
telecopier  or two (2) days after it is sent by  nationally  recognized  courier
(Federal  Express,  DHL etc.) to the party for which intended,  in each event at
the  following  addresses or telecopy  numbers (or at such address or numbers as
either party may specify by notice to the other hereunder):

         To the Maker:

         c/o Sadao Masayoshi
         990 West 190th, Suite 210
         Torrance, California 90502

         Telecopier No.: (310) 527-7148

         To the Payee:

         At the address established for payment.

         IN WITNESS  WHEREOF,  the Maker has duly executed this Note on the date
and year first above written.

                                            Yoshikazu Masayoshi

                                            Sadao Masayoshi

                                            Sachie Masayoshi

                                            Kazuaki Masayoshi

<PAGE>10.20.4

                            STOCK PURCHASE AGREEMENT

         AGREEMENT made March 26, 1999, between Aura Systems, Inc. ("Seller"), a
Delaware corporation with a place of business at 2335 Alaska Avenue, E1 Segundo,
California 90245, and Yoshikazu Masayoshi, Sadao Masayoshi, Sachie Masayoshi and
Kazuaki Masayoshi (jointly and severally,  "Purchaser"),  each having an address
c/o Sadao Masayoshi, 990 West 190th, Suite 210, Torrance, California 90502.

                              W I T N E S S E T H:

         WHEREAS,  Seller owns Two Hundred Eighty (280) shares (the "Shares") of
voting  common  stock,  (Y)50,000  par value per share,  of MYS K K., a Japanese
corporation (the "Corporation"); and

         WHEREAS,  Purchaser  desires to purchase  the Shares from  Seller,  and
Seller  desires  to sell the  Shares  to  Purchaser,  pursuant  to the terms and
conditions of this Agreement.

         NOW, THEREFORE, the parties agree as follows:

         1.       Sale of the Shares.

                  1.1  In  General.  Seller  hereby  sells  to  Purchaser,   and
Purchaser  hereby  purchases from Seller,  the Shares for the price and upon the
terms and conditions set forth in this Agreement.

                  1.2 Exclusion of Linaeum Loudspeaker Tweeters. Notwithstanding
anything  in  this  Agreement  to the  contrary,  Seller  will  retain  all  the
intellectual   properties  concerning  and  relating  to  "Linaeum"  loudspeaker
"tweeters" (the "Linaeum Technology").

               1.2.1  In  keeping  with  such  retention,  the  Corporation  has
          previously  assigned the Linaeum  Technology to Seller. In furtherance
          of such assignment,  the Corporation and Purchaser each further agrees
          at any time and from time to time to execute such other  documents and
          take  such  other  actions  as  may  be  necessary  or  desirable  (as
          determined  in Seller's  reasonable  judgment) to perfect,  confirm or
          evidence Seller's ownership of the Linaeum Technology.

                    1.2.2  The   Corporation,   however,   is  hereby   granted,
               conditioned  on  Purchaser's  performance  of  their  obligations
               pursuant   to   this   Agreement,   a   fully-paid,    perpetual,
               non-exclusive  license from Seller for the manufacture,  sale and
               distribution of the Linaeum Technology for OEM channels.

                    1.2.3 For  purposes  of  clarification,  the parties and the
               Corporation   acknowledge   and  agree   that  the   intellectual
               properties  concerning or relating to NRT have at all times been,
               and shall continue to be, the exclusive  property of Seller,  and
               no license or other  rights with respect to such  properties  has
               been or is hereby granted to the Corporation.

         2. Purchase Price/Assumption of Liabilities:

                  2.1 Purchase  Price.  The aggregate  cash  consideration  (the
"Price") to be paid by Purchaser for the Shares is $4,200,000,  plus interest as
provided in this section 2. The Price shall be paid as follows:

2.1.1 First Installment By April 15 I999.  $1,000,000,  without interest,  to be
paid in lawful funds of the United  States on or before  April 15,  1999,  which
obligation  is  evidenced  by a promissory  note being  executed  and  delivered
simultaneously with this Agreement.

                    2.1.2 Subsequent Installments. $3,200,000, with interest, to
               be paid in lawful funds of the United States in twelve (12) equal
               monthly  installments  of $290,000 each  (principal and interest)
               commencing on May 15, 1999 and continuing through April 15, 2000,
               which obligation is evidenced by a promissory note being executed
               and delivered simultaneously with this Agreement.

                  2.2 Assumption of Liabilities. As additional consideration for
the  Shares,  Purchaser  and the  Corporation  agree to assume  all  liabilities
accruing  from the  Corporation  or the  operation of its business from March 1,
1996 through the date of this Agreement (including,  but not limited to, any and
all  liabilities  arising out of or relating to that  certain  judgment  against
defendants in an action  entitled  Stutz,  et. al v. Aura Systems Inc., et al in
the Circuit Court of the State of Oregon bearing case No. 9903-(12302), and each
Purchaser and the  Corporation  agree,  jointly and severally,  to indemnify and
hold Seller harmless from and against any and all such liabilities.

         3.       Security.

                  3.1  Escrow.  To  secure  payment  of the Price as well as the
performance of the other  obligations of Purchaser  pursuant to this  Agreement,
the Shares are being delivered to Wolf Haldenstein Adler Freeman & Herz LLP (the
"Escrow Agent"),  to be held in escrow pursuant to that certain Escrow Agreement
(the "Escrow  Agreement")  executed  simultaneously  with the  execution of this
Agreement.  To accomplish  such  delivery,  Purchaser will deliver to the Escrow
Agent the certificate(s) for the Shares together with stock power(s) executed in
blank.  Also being held in this  escrow are blank dated  letters of  resignation
from each Purchaser and blank dated letters from the Corporation to its banks.

                  3.2 Remedies. In the event of any default, Seller shall have a
right  of  action  for full  performance  against  each  Purchaser  jointly  and
severally,  and shall not be required  to first  pursue any  remedies  available
pursuant to the Escrow Agreement.

         4.       Deliveries at Closing.

                  4.1 Delivery of the Shares. Seller has simultaneously herewith
delivered  the Shares to  Purchaser.  To accomplish  such  delivery,  Seller has
tendered the certificate for the Shares together with the necessary stock power.

                  4.2 Deliveries of Escrow  Agreement and Escrow Items.  Seller,
Purchaser  and the  Escrow  Agent  have  simultaneously  herewith  executed  and
delivered the Escrow  Agreement  among one another and the  appropriate  parties
have  delivered  to the Escrow Agent the items to be held in escrow as described
in section 3 and the Escrow Agreement.

         5.       Additional Terms and Conditions.

                  5.1  Conduct  of  Business.  From and  after  the date of this
Agreement,  and  continuing  until  receipt  by  Seller of the full  Price,  the
Corporation  will conduct its  business  only in the  ordinary  course.  Without
limiting the  generality  of the prior  sentence,  the  Corporation  agrees that
during the described period it will not dispose of, transfer, assign or encumber
any asset or take any other  action  with  respect to any matter  outside of the
ordinary  course  of  business  nor  will it pay  dividends  or  otherwise  make
distributions to its shareholders.

                  5.2 Appointment of Representative Director. From and after the
date of this  Agreement,  and  continuing  until  receipt  by Seller of the full
Price, Seller shall have the right to appoint one Representative Director of the
Corporation.  Each Purchaser  agrees to vote the Shares owned by him in favor of
the election of the Representative Director designated by Seller.

                  5.3  Confidentiality.  Seller, on one hand, and Purchaser,  on
the other  hand,  each  agree  that this  Agreement  and its  contents  shall be
maintained in confidence  and that neither this Agreement nor its contents shall
be disclosed to any third parties, except that disclosure may be made on a "need
to know" basis to each party's  counsel,  accountants,  shareholders,  potential
financing  sources and investment  bankers,  provided that such third parties in
turn agree to retain the disclosed information in confidence.

                  5.4 Public  Announcements.  Neither  party shall,  without the
prior written consent of the other party, make any public release of information
regarding the matters contained in or contemplated by this Agreement, except (1)
each party may communicate with its employees,  customers,  suppliers,  lenders,
lessors,  shareholders and other particular groups as may be legally required or
necessary for an appropriate business purpose and not inconsistent with the best
interests  of the  other  party or the  prompt  performance  of the  obligations
contemplated  by this Agreement and (2) as required by law.  Neither party shall
issue any press releases or similar announcement regarding this Agreement or the
transactions  contemplated by this Agreement  without the prior written approval
of the other party which approval shall not be unreasonably withheld or delayed.

                  5.5  Expenses  of the  Transaction.  Each  party,  for its own
behalf,  shall be solely responsible for and shall bear all of its own expenses,
including,  but not  limited  to  expenses  of  counsel,  accountants  and other
advisers,  incurred at any time in connection with the transactions contemplated
by this Agreement.

         6.       Representations.

         6.1      Seller.  Seller represents and warrants to Purchaser that:

                    6.l.1 It has full power and  authority  to execute,  deliver
               and perform this  Agreement,  and this  Agreement is binding upon
               it.

                    6.1.2 No  brokers,  finders  or  agents,  were  involved  in
               connection with this Agreement.

             6.2  Purchaser.  Purchaser represents and warrants to Seller that:

                           6.1.2  They  each have full  power and  authority  to
execute, deliver and perform this Agreement, and this Agreement is binding upon
each of them.

                       6.2.2  Each of them is fully  familiar  with the business
                    and  operations  of  the  Corporation,  including,  but  not
                    limited to, the business and operations of its  subsidiaries
                    and  affiliates,   has  made  such   investigation   of  the
                    Corporation as he has deemed advisable and believes that the
                    Price is fair and reasonable.  Each of them  understands and
                    acknowledges that there are no representations being made by
                    Seller with respect to the Corporation,  its subsidiaries or
                    affiliates.

                           6.2.3 No brokers,  finders or agents were involved in
connection with this Agreement.

                  6.3 Survival.  The  representations,  warranties and covenants
contained in this Agreement,  including,  but not limited to, those set forth in
section 5 and this  section 6, shall  survive  the  closing.  Each party  hereby
agrees to indemnify and hold harmless the other party from and against any loss,
liability or expense (including, without limitation,  reasonable attorneys fees)
which  such  other  party  may incur  due to the  breach of any  representation,
warranty or covenant of the indemnifying party.

         7.       Governing Law/Consent to Jurisdiction.

                  7.1 Governing  Law.  This  Agreement has been made and entered
into in the State of  California  and shall be  governed  by and  construed  and
enforced  in  accordance  with the  internal  substantive  laws of the  State of
California, without regard to principles of conflicts of laws.

                  7.2 Consent to Jurisdiction.  The parties  irrevocably consent
to the  jurisdiction  of the courts of the State of California  (and the Federal
courts  having  jurisdiction  in the State of  California)  for  purposes of any
judicial  proceeding  which may be  instituted  in  connection  with any  matter
arising under or relating to this Agreement.

         8.       Miscellaneous.

                  8.1 Captions.  Headings  contained in this Agreement have been
inserted for reference  purposes only and shall not be construed as part of this
Agreement.

                  8.2 Entire  Agreement.  This  Agreement  represents the entire
agreement between Seller and Purchaser  regarding the subject matter hereof, and
supercedes  any and all prior  understandings,  whether  oral or  written,  with
respect thereto,  including,  but not limited to, that certain binding letter of
intent dated March 19, 1999.  This  Agreement  cannot be modified or terminated,
nor may any of its provisions be waived,  except by a written  instrument signed
by Seller and Purchaser.  There are no representations,  warranties or covenants
except as expressly set forth in this Agreement.

                  8.3 Notices.  Any notice or other  communication given or made
pursuant  to this  Agreement  must be in writing and shall be  delivered  to the
person to whom intended at the address set forth above (or at such other address
as such  person  may  designate  by proper  notice)  by  personal  delivery,  by
telecopier,  by nationally recognized courier (Federal Express, DHL, etc.) or by
certified or registered mail,  postage  prepaid,  and shall be deemed given when
personally  delivered  or sent by  telecopier  or two (2)  business  days  after
deposit with a courier or five (5) business days after mailing.

                  8.4  Severability.  This  Agreement  shall be  enforced to the
fullest extent  permitted  under  applicable law and with each of its provisions
regarded as severable.

                  8.5 Rights and Remedies Cumulative. The rights and remedies of
the  parties  pursuant  to this  Agreement  and  under  applicable  law shall be
cumulative.

         IN WITNESS WHEREOF,  the parties have executed this Agreement as of the
day and year first above written.

SELLER:                                              PURCHASER:

AURA SYSTEMS, INC.

By:
         Name:                                      Yoshikazu Masayoshi
         Title:

                                                    Sadao Masayoshi

                                                    Sachie Masayoshi

                                                    Kazuaki Masayoshi

AGREED TO:

MYS K.K.

By:
         Name:
         Title:

<PAGE>

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