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EXHIBIT 3
THIS DEBT INSTRUMENT IS
ISSUED WITH OID
THE SECURITY REPRESENTED HEREBY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS (COLLECTIVELY, THE
"SECURITIES ACTS"), AND IS NOT TRANSFERABLE, EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACTS, OR EXEMPTIONS FROM
REGISTRATION THEREUNDER. FURTHERMORE, THE SECURITY REPRESENTED HEREBY IS ONLY
TRANSFERABLE PURSUANT TO THE PROVISIONS OF ARTICLE 8 OF THAT CERTAIN SENIOR
SUBORDINATED LOAN AGREEMENT OF EVEN DATE HEREWITH AMONG CLARION TECHNOLOGIES,
INC., ITS SUBSIDIARIES PARTY THERETO AND XXXXXXX XXXXX MEZZANINE CAPITAL FUND
III, L.P. A COPY OF SUCH ARTICLE OF THE SENIOR SUBORDINATED LOAN AGREEMENT WILL
BE FURNISHED BY THE ISSUER TO THE HOLDER HEREOF UPON WRITTEN REQUEST THEREFOR BY
HOLDER.
THIS SUBORDINATED NOTE ("NOTE") AND THE RIGHTS AND OBLIGATIONS EVIDENCED HEREBY
ARE SUBORDINATE IN THE MANNER AND TO THE EXTENT SET FORTH IN THAT CERTAIN
SUBORDINATION AGREEMENT DATED AS OF JULY 21 , 2000 (AS AMENDED, MODIFIED OR
RESTATED, THE "INTERCREDITOR AGREEMENT") AMONG CLARION TECHNOLOGIES, INC., A
DELAWARE CORPORATION ("COMPANY"), CERTAIN SUBSIDIARIES OF THE COMPANY (TOGETHER
WITH THE COMPANY, THE "LOAN PARTIES"), XXXXXXX XXXXX MEZZANINE CAPITAL FUND III,
L.P. AND LASALLE BANK NATIONAL ASSOCIATION ("AGENT"), TO THE INDEBTEDNESS
(INCLUDING INTEREST) OWED BY THE LOAN PARTIES TO THE HOLDERS OF ALL OF THE NOTES
ISSUED PURSUANT TO, AND THE OTHER LENDER PARTIES UNDER, THAT CERTAIN CREDIT
AGREEMENT DATED AS OF FEBRUARY 29, 2000, AS AMENDED, AMONG THE LOAN PARTIES,
AGENT AND THE BANKS AND OTHER LENDERS THEREUNDER, AS SUCH CREDIT AGREEMENT MAY
BE AMENDED, MODIFIED OR SUPPLEMENTED FROM TIME TO TIME; AND EACH HOLDER OF THIS
NOTE, BY ITS ACCEPTANCE HEREOF, SHALL BE BOUND BY THE PROVISIONS OF THE
INTERCREDITOR AGREEMENT.
CLARION TECHNOLOGIES, INC.
SENIOR SUBORDINATED NOTE
$30,000,000 July 21, 0000
Xxxxxxx, Xxxxxxxx
FOR VALUE RECEIVED, the undersigned, CLARION TECHNOLOGIES, INC., a
Delaware corporation (the "Company"), and the subsidiaries of the Company
signatory hereto (together with their successors and assigns, the "Loan
Parties"), jointly and severally, hereby promise to pay to the order of XXXXXXX
XXXXX MEZZANINE CAPITAL FUND III, L.P. ("Lender"), the principal sum of Thirty
Million Dollars ($30,000,000), together with interest thereon, which shall be
due and payable as provided herein.
This promissory note is the "Senior Subordinated Note" referred to in, and
Lender is entitled to the benefits of, that certain Senior Subordinated Loan
Agreement of even date herewith (the "Loan Agreement") between the Loan Parties
and Lender. The terms and provisions of the Loan Agreement are deemed
incorporated herein by this reference and this Senior Subordinated Note shall be
subject in all respects to the terms and provisions of the Loan Agreement, as
the same may be hereafter amended from time to time. Unless otherwise defined
herein, all capitalized terms used herein shall have the meanings set forth in
the Loan Agreement.
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1. Payment of Interest.
(a) So long as no Event of Default has occurred and is continuing,
interest shall accrue from the date hereof on the unpaid principal amount
of this Senior Subordinated Note from time to time outstanding until paid,
computed on the basis of a 360-day year for the actual number of days
elapsed, initially at a fixed annual rate of 12.00% and, from and after
the date of completion of the Minimum Equity Contribution, at a fixed
annual rate of 11.50%.
(b) Interest shall be due and payable quarterly in arrears on each
Quarterly Payment Date commencing on September 30, 2000. In addition, all
accrued and unpaid interest shall be paid upon the payment in full of the
outstanding principal amount of this Senior Subordinated Note and, if
payment in full is not made when due, thereafter on demand.
2. Additional Interest. After the occurrence and during the continuance of
any Event of Default, the Obligations shall bear interest from the date of the
occurrence of such Event of Default, payable on demand, at a fixed annual rate
which exceeds the then applicable fixed annual rate under Section 1(a) hereof by
three percent (3%) per annum.
3. Payment of Principal. The aggregate principal of this Senior
Subordinated Note shall be paid in full on June 30, 2007, subject to the
provisions of the Loan Agreement concerning mandatory and optional prepayments.
4. Payment Instructions. All payments of principal, interest, and any
other amounts due and payable hereunder shall be made prior to 12:00 p.m.,
Chicago, Illinois, time, on the due date, by wire transfer of immediately
available funds to Lender's account as specified in Schedule 2.5 to the Loan
Agreement (or at any other payment office in the United States previously
designated to the Loan Parties by Lender in writing), in lawful money of the
United States of America.
5. Events of Default; Acceleration of Payments. Under certain
circumstances described in Article 7 of the Loan Agreement, the occurrence of an
Event of Default may result in the acceleration of any and all Obligations of
the Loan Parties hereunder and the same may thereupon become immediately due and
payable.
6. Miscellaneous.
(a) Pursuant to 26 C.F.R. ss.1.1275-3, the Company states that its
President or Chief Executive Officer, as representative of the Loan
Parties, located at 000 Xxxxxxx Xxxxxx, Xxxxxxx, XX 00000, will make
available on request to the holder of this debt instrument, the following
information: issue price, amount of original issue discount, issue date
and yield to maturity.
(b) Except as otherwise expressly provided in the Loan Agreement,
the Loan Parties whether as makers, endorsers or otherwise, severally
waive presentment, demand, notice, protest and all other demands and
notices in connection with the delivery, acceptance, performance, default
or enforcement of this Senior Subordinated Note.
(c) The Loan Parties agree, jointly and severally, to pay all
reasonable costs and expenses, including, without limitation, reasonable
attorneys' fees and expenses, expended or incurred by Lender in connection
with the enforcement of this Senior Subordinated Note, the
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collection of any sums due hereunder, any actions for declaratory relief
in any way related to this Senior Subordinated Note or the protection or
preservation of any rights of Lender hereunder.
(d) Any and all notices, elections, demands, requests and responses
thereto permitted or required to be given by or under this Senior
Subordinated Note shall be given as provided in Section 8.6 of the Loan
Agreement.
(e) This Senior Subordinated Note shall be deemed to be a contract
under the laws of the State of Illinois and for all purposes shall be
governed by and construed and enforced in accordance with the laws of the
State of Illinois, without giving effect to any choice of law or conflict
of law provision or rule (whether of the State of Illinois or any other
jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Illinois.
(f) The liability of each Loan Party under this Note in general
shall be joint and several, and each reference herein to the Loan Parties
shall be deemed to refer to each such Loan Party. In furtherance and not
in limitation of Lender's rights and remedies hereunder or at law, Lender
may proceed under this Note against any one or more of the Loan Parties in
its absolute and sole discretion for any Loan Parties' obligations under
the Loan Agreement or any other liability or obligation of the Loan
Parties arising hereunder.
(g) The covenants of the Loan Parties set forth herein shall be
binding upon the Loan Parties and its successors and assigns and shall
inure to the benefit of Lender and its successors and assigns.
* * * *
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IN WITNESS WHEREOF, the undersigned have duly executed this Senior
Subordinated Note as of the date first written above.
CLARION TECHNOLOGIES, INC.
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx, Chief Financial Officer
CLARION PLASTICS TECHNOLOGIES, INC.
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx, Chief Financial Officer
CLARION REAL ESTATE, LLC
By: Clarion Technologies, Inc., its Member
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx, Chief Financial Officer
DOUBLE "J" MOLDING, INC.
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx, Chief Financial Officer
CLARION-DRAKE ACQUISITION, INC.
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx, Chief Financial Officer
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MITO PLASTICS, INC.
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx, Chief Financial Officer
WAMAR PRODUCTS, INC.
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx, Chief Financial Officer
WAMAR TOOL & MACHINE CO.
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx, Chief Financial Officer
