THIS SUBORDINATED PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION UNDER SUCH ACT
AND THE RULES AND REGULATIONS THEREUNDER.
SUBORDINATED PROMISSORY NOTE
$__________________ June ___, 1999
FOR VALUE RECEIVED, PRO GOLF INTERNATIONAL, INC., a Delaware corporation
("Debtor"), promises to pay to the order of ___________________________("Payee")
the principal sum of _____________________________________ ($_______________)
plus interest on the unpaid principal balance hereof as follows:
(a) from the date hereof and continuing for a period of thirteen
(13) months from the execution of this Note, (i) the unpaid principal
balance hereof shall bear interest at the rate of ten percent (10%), and
(ii) payment of accrued and unpaid interest hereunder shall be due and
payable on the last day of each calendar quarter hereunder, commencing
with the payment on June 30, 1999.
(b) the unpaid principal balance hereof, together with any accrued
and paid interest due thereon, shall be due and payable in full on the
last day of the calendar month which is thirteen (13) months from the
execution of this Note.
Payment of both principal and interest hereunder shall be made to Payee at
_____________ _______________ or at such other place as shall from time to time
be designated by Xxxxx in writing.
This Subordinated Promissory Note may be prepaid at any time or times, in
whole or in part, without premium or penalty. All prepayments hereunder shall be
applied first to accrued and unpaid interest on the principal balance
outstanding hereunder at the rate specified above, and the remainder to
principal.
The payment of this Note is subordinated pursuant to that certain
Subordination Agreement dated the date hereof by and among Payee and Comerica
Bank (together with such other institutional lenders as may provide financing to
Maker from time to time, the "Senior Lender") and to such other subordination
agreements, if any, as Payee may enter into with a Senior Lender from time to
time (the "Subordination Agreement").
Debtor shall be deemed to be in default hereunder upon the first to occur
of any of the following events (a "Default"): (i) Debtor shall fail to make any
payment of interest or principal hereunder, and such failure shall remain
uncured for ten (10) days following delivery to Debtor of written notice
thereof; or (ii) Debtor shall fail to perform any other of its obligations
hereunder, and such failure shall remain uncured for ten (10) days following
delivery to Debtor of written notice thereof; or (iii) any representation or
warranty made by Debtor in this Subordinated Promissory Note shall prove to have
been false or misleading in any material respect as of the date hereof; or (iv)
Debtor shall become insolvent, shall make an assignment for the benefit of
creditors, or shall admit in writing the inability to pay its debts as they
mature; or (v) Debtor shall apply for, consent to or acquiesce in the
appointment of a trustee, receiver, or other custodian for itself, or for any of
its property; or (vi) any bankruptcy, debt arrangement or other case or
proceeding under any bankruptcy or insolvency law shall be instituted by or
against Debtor unless any of the foregoing acts shall have been stayed,
dismissed or discharged, as the case may be, within thirty (30) days after the
occurrence thereof; or (vii) Debtor shall cease to conduct its business
substantially as currently conducted, or shall be dissolved or liquidated.
Effective immediately upon the occurrence of a Default, the entire unpaid
principal balance hereof and all accrued and unpaid interest thereon shall
become immediately due and payable without demand, notice or legal process of
any kind, and Xxxxx may proceed to exercise any other rights and remedies
against Debtor under this Subordinated Promissory Note. Xxxxx's remedies as
provided in this Subordinated Promissory Note shall be cumulative and
concurrent, and may be pursued singularly, successively or together, at the sole
discretion of Payee, and may be exercised as often as occasion therefor shall
arise. Failure of Payee, for any period of time or on more than one occasion, to
exercise Payee's option to accelerate this Subordinated Promissory Note shall
not constitute a waiver of the right to exercise the same at any time thereafter
in the event of any subsequent Default. No act of omission or commission of
Payee, including specifically any failure to exercise any right, remedy or
recourse, shall be deemed to be a waiver or release of such right, remedy or
recourse or any other right, remedy or recourse at any time. A waiver or release
with reference to any one event shall not be construed as a waiver or release of
any subsequent event or as a bar to any subsequent exercise of Xxxxx's rights or
remedies hereunder and any waiver or release hereunder shall be effected only
through a written document executed by Xxxxx and then only to the extent
specifically recited therein.
Debtor shall pay to Payee on demand all attorneys' fees, court costs and
other costs and expenses incurred by Payee in connection with the collection or
enforcement of this Subordinated Promissory Note.
This Subordinated Promissory Note shall inure to the benefit of Payee and
Xxxxx's successors and assigns, and shall be binding upon Debtor and its
successors and assigns.
This Subordinated Promissory Note shall be governed by and construed in
accordance with the internal laws of the State of Michigan, without regard to
conflict of laws principles.
Debtor hereby waives presentment for payment, notice of dishonor, protest
and notice of protest.
All notices required under this Subordinated Promissory Note will be in
writing and will be transmitted by personal delivery, first class mail, or
overnight courier to the addresses for the parties appearing in this
Subordinated Promissory Note, or to such other addresses as the parties may
specify from time to time in writing. Every notice shall be deemed to have been
duly given or served on the date on which personally delivered, in person or by
overnight courier service, or five days after the same shall have been deposited
in the United States mail, registered or certified mail requested.
IN WITNESS WHEREOF, Debtor has set its hand on the date first above
written.
PRO GOLF INTERNATIONAL, INC.,
a Delaware corporation
By:_______________________________
Its:______________________________
Address:
0000 Xxxxxxx Xxxx Xxxx
Xxxx Xxxxxxxxxx, Xxxxxxxx 00000
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