EXHIBIT 2
FIRST AMENDMENT TO
EXTENSION OF TERM OF NOTES UNDER MASTER LINE OF CREDIT AGREEMENT
This First Amendment to Extension of Term of Notes under Master Line of Credit
Agreement (this "Amendment") is made and entered into as of November 13, 2002,
effective as of August 15, 2002 (the "Effective Date") by and between Mendocino
Brewing Company, Inc., a California corporation ("Borrower"), and United
Breweries of America, Inc., a Delaware corporation ("Lender").
RECITALS
A. Borrower and Lender entered into an Extension of Term of Notes Under
Master Line of Credit Agreement dated February 14, 2002 (the "Original
Agreement"), which provides that the terms of certain of the Notes made by
Borrower in favor of Lender shall be extended until August 15, 2002.
B. Lender agreed not to take any action against Borrower with respect to
the Notes during the period beginning on the Effective Date and ending on the
date hereof, for so long as the parties were negotiating the terms of the
Amendment.
C. Subject to the terms and conditions of this Amendment, the parties wish
to further extend the terms of certain of the Notes.
D. Any capitalized terms not otherwise defined herein shall have the
meanings set forth in the Original Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is acknowledged, Borrower and Lender agree as follows:
1. Extension of Term. Section 1 of the Original Agreement is amended to
read as follows:
The Notes provide that Lender has the right, at any time on or after the
respective maturity dates of the Notes, to convert the Notes into shares
of Borrower's common stock. However, Section 3 of the Notes provides that
in the event that Lender has not converted the entire principal amount of
any Note on or before its respective maturity date, Lender has the right
to extend the term of such Note for a period of time mutually agreed upon
between Lender and Borrower. Borrower and Lender had previously agreed to
extend the term of each of the Notes itemized Nos. 1 through 8 on Exhibit
A, effective as of the maturity date of each respective Note, for an
indefinite period of time pending the Borrower's and Lender's discussions
regarding conversion of the Notes; this Agreement hereby confirms that
agreement. The parties hereby modify their previous agreement and agree to
extend the term of each of the Notes itemized Nos. 1 through 13 on Exhibit
A, effective as of the maturity date of each respective Note, for a period
of time ending on March 31, 2003.
2. Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of California, without regard to the
conflicts of laws principles of that or any other jurisdiction.
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3. Counterparts. This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original, and all taken together
shall constitute one and the same instrument.
4. Miscellaneous. This Amendment, in connection with the Original
Agreement, contains all of the agreements, conditions, promises and covenants
between the parties with respect to the subject matter hereof and supersedes all
prior or contemporaneous agreements, representations or understandings with
respect to the subject matter hereof. In the event of any conflict between the
terms of the Original Agreement and this Amendment, the terms of this Amendment
shall govern. Except as set forth in this Amendment, the terms of the Original
Agreement shall remain in full force and effect. This Amendment may not be
amended, modified, altered or otherwise changed in any respect except by written
agreement signed by authorized representatives on behalf of Borrower and Lender.
If any one or more of the provisions contained in this Amendment shall be
invalid, illegal or unenforceable in any respect, the validity, legality or
enforce ability of the remaining provisions contained herein shall not in any
way be affected or impaired.
IN WITNESS WHEREOF, duly executed representatives of each of the parties hereto
have executed and delivered this Amendment as of the Effective Date.
Borrower: Lender:
MENDOCINO BREWING COMPANY, INC. UNITED BREWERIES OF AMERICA, INC.
a California corporation a Delaware corporation
By: /s/ X. Xxxxxxxxx By: /s/ Xxxx Xxxxxxxxx
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Name: X. Xxxxxxxxx Name: Xxxx Xxxxxxxxx
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Title: Secretary Title: Secretary
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