AMENDED AND RESTATED PROMISSORY NOTE
AMENDED
AND RESTATED PROMISSORY NOTE
US
$1,129,334.00
December
6, 2005
RECITAL.
Reference is made to that certain promissory note dated October 15, 2004 (the
"Original Note") by and between Drinks Americas Holdings, Ltd., a Delaware
corporation (the "Company"), as borrower, and Xxxxxxx X. Xxxxx, an individual,
as lender, in the principal amount of $352,167.00 (the "Original Amount").
The
Original Note is secured with a perfected security interest in the tangible
and
intangible assets of the Company pursuant to a Security Agreement between the
Company and Xxxxxxx X. Xxxxx (the "Security Agreement"). At this time, Xxxxxxx
X. Xxxxx, together with X. Xxxxxxx Xxxxx, Greenwich Beverage Group, LLC (by
Xxxxxx Xxxxxxx, Managing Member), Hebrides L.P., and Hebrides II Offshore Fund
Limited, wish to amend the Original Note (without changing the terms,
conditions, provisions, rights, or obligations under the Security Agreement)
to
increase the borrowings of the Company by an additional $777,167.00 (the
"Additional Amount"), receipt of which Additional Amount is hereby acknowledged
by the Company, to a total (exclusive of any accrued and unpaid interest or
other charges under the Original Note) of $1,129,334.00.
The
terms
and conditions associated with the Original Amount pursuant to the Original
Note
shall remain unchanged and in full force and effect, except that the Additional
Amount shall be secured by the collateral securing the Original Amount under
the
and the terms and conditions of the Security Agreement (pro rata). The rights
of
the lenders and the obligations of the Company with respect to the Additional
Amount shall be as stated below, which terms and conditions shall not apply
to
the Original Amount which shall continue to be governed by the Original
Note.
ADDITIONAL
AMOUNT:
FOR
VALUE RECEIVED, the Company hereby promises to pay to the order of Xxxxxxx
X.
Xxxxx (in the amount of $100,000.00), Greenwich Beverage Group, LLC (in the
amount of $100,000), X. Xxxxxxx Xxxxx (in the amount of $25,000.00), Hebrides
L.P. (in the amount of $440,000.00), and Hebrides II Offshore Fund Limited
(in
the amount of $112,167) ( the "Lenders", or with respect to one of them, the
"Lender"), the aggregate principal amount of Seven Hundred Seventy-Seven
Thousand One Hundred Sixty-Seven Dollars ($777,167.00), together with interest
on such principal amount under this note (this "Note") at the per annum rate
of
twelve (12%) percent (calculated daily on the basis of a 360-day year and actual
calendar days elapsed), which principal shall be payable within two business
days after demand by the Lenders (the "Maturity Date") together with any unpaid
interest accrued as of such date, and in the absence of such demand, interest
shall be payable on a monthly basis on the 1st day of January, 2006 and
continuing on the same day of each succeeding month. All amounts which are
not
paid when due hereunder, after the expiration of any applicable grace period,
shall bear interest at the rate of 14% per annum, but in no event higher than
the maximum rate of interest permitted by law.
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The
payments due under this Note shall be paid in lawful money of the United States
of America to the Lenders at the address as the Lenders may designate by notice
in writing to the Company, in immediately available funds.
1.
Prepayment.
The Company may prepay this Note in whole or in part without penalty upon
not
less than ten (10) days' prior notice, together with accrued interest to
the
date of prepayment. Upon prepayment of this Note in part, the Lender shall
surrender this Note and the Maker shall issue a substitute note of like tenor
in
the amount of the then unpaid principal amount. Upon prepayment of this Note
in
full, this Note shall be surrendered by the Lender and
cancelled.
2.
Withholding.
If required by any Federal, state or local law, the Company shall withhold
any
required amounts from payments due to the Lenders for payment to the appropriate
taxing authority. Any amounts so withheld hereunder will be treated as a
payment
by the Company to the Lenders.
3.
Events
of
Default. The entire unpaid principal amount under this Note and the interest
due
thereon shall forthwith become and be due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby expressly
waived, if any one or more of the following events (herein called "Events
of
Default") shall have occurred and be continuing:
(a)(i)
the
Company shall fail to pay any amounts owed hereunder when due and such default
continues for a period of five (5) days (referred to herein as the "grace
period") or (ii) an event of default shall have occurred and be continuing
under
material indebtedness of the Company ;
(b)if
the
Company shall:
(i)admit
in
writing its inability to pay its debts generally as they become
due;
(ii)
file
a
petition in bankruptcy or a petition to take advantage of any insolvency
act;
(iii) make
an
assignment for the benefit of creditors; or
(iv)consent
to the appointment of a receiver of the whole or any substantial part of
its
assets;
(c)if
a
court of competent jurisdiction shall enter an order, judgment, or decree
appointing, without the consent of the Company, a receiver of the whole or
any
substantial part of Company's assets, and such order, judgment or decree
shall
not be vacated or set aside or stayed within 90 days from the date of entry
thereof;
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(d)if,
under
the provisions of any other law for the relief or aid of debtors, any
court of
competent jurisdiction shall assume custody or control of the whole or
any
substantial part of Company's assets and such custody or control shall
not be
terminated or stayed within 90 days from the date of assumption of such
custody
or control; or
(e)any
final
non-appealable judgment is entered against the Company for an amount exceeding
$100,000 or any of the Company's properties or assets, with a fair market
value
of at least $100,000, is attached or levied or a restraining notice is placed
thereon and such judgment or encumbrance is not satisfied or cancelled in
full
within 30 days after it is entered.
4.
Remedies. In case any one or more of the Events of Default specified in Section
3 hereof shall have occurred and be continuing, the Lenders may proceed to
protect and enforce its rights either by suit in equity and/or by action at
law,
whether for the specific performance of any covenant or agreement contained
in
this Note or in aid of the exercise of any power granted in this Note, or the
Lenders may proceed to enforce the payment of all sums due upon this Note or
to
enforce any other legal or equitable right of the Lenders.
5.
Amendments and Waivers. Any term of this Note may be amended and the observance
of any term of this Note may be waived (either generally or in a particular
instance and either retroactively or prospectively) with the written consent
of
the Company and the Lenders.
7.
Notices. All notices, requests, consents, and other communications under this
Note shall be in writing and shall be deemed delivered (i) three (3) business
days after being sent by registered or certified mail, return receipt requested,
postage prepaid or (ii) one (1) business day after being sent via a reputable
nationwide overnight courier service guaranteeing next business day delivery,
in
each case to the intended recipient as set forth below:
If
to the
Company:
000
Xxxxxxx Xxxx
Xxxxxx,
Xx 06897
Attn:
J
Xxxxxxx Xxxxx
Fax:
(000) 000-0000
If
to
Lenders:
Xxxxxxx
X. Xxxxx
00
Xxx
Xxxx Xxxx
Southport,
CT 06890
Fax:
(203) 000- 0000
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Greenwich
Beverage Group, LLC
c/o
Xxxxxx Xxxxxxx, Managing Member
0000
Xxxxxxxxx Xxxxxxxx Xxxx Xxx
Hobe
Sound, FL 33455
X.
Xxxxxxx Xxxxx
00
Xxx
Xxxxx Xxxx
Ridgefield,
CT 06877
Hebrides
L.P.
000
Xxxxx
Xxxxxx, 00xx xxxxx
New
York,
NY 10016
Hebrides
II Offshore Fund Limited
Vanterpool
Plaza, 2nd floor
Wickhams
Cay I
Road
Town, Tortola
British
Virgin Islands
(ii)
Any
party may give any notice, request, consent or other communication under this
Note using any other means (including, without limitation, personal delivery,
messenger service, telecopy, first class mail or electronic mail), but no such
notice, request, consent or other communication shall be deemed to have been
duly given unless and until it is actually received by the party for whom it
is
intended. Any party may change the address to which notices, requests, consents
or other communications hereunder are to be delivered by giving the other
parties notice in the manner set forth in this Section.
8.
Warrants. Promptly after the execution of this Note by the Company, the Company
shall issue to the Lenders a Warrant to purchase such number of shares of its
common stock as equals twenty five percent of the principal amount of the
Additional Amount, for an exercise price of $.45 per share of common stock.
Such
warrant will be exercisable for a five year period, have cashless exercise
provisions, full-ratchet anti-dilution protection and contain such other
provisions as are typically found in Warrants issued to lenders. The failure
of
the Company to satisfy the requirements of this provision will constitute an
Event of Default under this Note. The common shares underlying such warrants
shall be included with the next registration statement (the "Registation"),
to
be filed with the Securities and Exchange Commission (on Form SB-2 or otherwise)
within ninety (90) days from the date hereof.
9.
Option
to Convert. Each of the Lenders shall have the right, by written notice to
the
Company, to convert all or any unpaid portion of the Additional Amount,
including, without limitation, any accrued and unpaid interest on the Additional
Amount, into the debt or equity securities of the Company pursuant to the terms
of any private placement equal to or in excess of $5 million closed by the
Company on or before December 31, 2006, at a price equal to the lower of (a)
twenty per cent (20%) below the price at which the Company issues any such
securities, or (b) $0.45 per common share. Upon any such conversion, the common
shares underlying such securities shall be included in the Registration
following the date(s) of any conversion pursuant to the terms of this
Paragraph.
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10.
Conflicting Agreements. In the event of any inconsistencies between the terms
of
this Note and the terms of any other document related to the loan evidenced
by
this Note, the terms of this Note shall prevail.
11.
Severability. The unenforceability or invalidity of any provision or provisions
of this Note as to any persons or circumstances shall not render that provision
or those provisions unenforceable or invalid as to any other provisions or
circumstances, and all provisions hereof, in all other respects, shall remain
valid and enforceable.
12.
Governing Law. This Note shall be governed by and construed under the laws
of
the State of New York as applied to agreements among New York residents entered
into and to be performed entirely within New York. THE PARTIES HERETO AGREE
TO
WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF THIS NOTE OR ANY DOCUMENT OR AGREEMENT CONTEMPLATED
HEREBY.
13.
Waivers. The nonexercise by either party of any of its rights hereunder in
any
particular instance shall not constitute a waiver thereof in that or any
subsequent instance.
14.
Lost
Documents. Upon receipt by the Company of evidence satisfactory to it of the
loss, theft, destruction or mutilation of this Note or any Note exchanged for
it, and (in the case of loss, theft or destruction) of indemnity satisfactory
to
it, and upon reimbursement to the Company of all reasonable expenses incidental
thereto, and upon surrender and cancellation of such Note, if mutilated, the
Company will make and deliver in lieu of such Note a new Note of like tenor
and
unpaid principal amount and dated as of the original date of this
Note.
[Signature
Page Follows]
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IN
WITNESS WHEREOF, the Company has caused its duly authorized officer to execute
this Note as of the date first written above.
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