EXHIBIT 4.11
SECURED REVOLVING NOTE
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FOR VALUE RECEIVED, each of XSTREAM BEVERAGE NETWORKS, INC., a Nevada
corporation (the "Parent"), and the other companies listed on Exhibit A attached
hereto (such other companies together with the Parent, each a "COMPANY" and
collectively, the "COMPANIES"), jointly and severally, promises to pay to LAURUS
MASTER FUND, LTD., c/o M&C Corporate Services Limited, P.O. Box 309 GT, Xxxxxx
House, South Church Street, Xxxxxx Town, Grand Cayman, Cayman Islands, Fax:
000-000-0000 (the "HOLDER") or its registered assigns or successors in interest,
the sum of Four Million Dollars ($4,000,000) or, if different, the aggregate
principal amount of all Revolving Loans (as defined in the Security Agreement
referred to below), together with any accrued and unpaid interest hereon, on
March 31, 2009 (the "MATURITY DATE") if not sooner indefeasibly paid in full.
Capitalized terms used herein without definition shall have the
meanings ascribed to such terms in the Security and Purchase Agreement among the
Companies and the Holder dated as of the date hereof (as amended, modified
and/or supplemented from time to time, the "SECURITY AGREEMENT").
The following terms shall apply to this Secured Revolving Note (this
"NOTE"):
ARTICLE I
CONTRACT RATE
1.1 Contract Rate. Subject to Sections 2.2 and 3.9, interest payable on
the outstanding principal amount of this Note (the "PRINCIPAL AMOUNT") shall
accrue at a rate per annum equal to the "prime rate" published in The Wall
Street Journal from time to time (the "PRIME RATE"), plus two percent (2%) (the
"CONTRACT RATE"). The Contract Rate shall be increased or decreased as the case
may be for each increase or decrease in the Prime Rate in an amount equal to
such increase or decrease in the Prime Rate; each change to be effective as of
the day of the change in the Prime Rate. The Contract Rate shall not at any time
be less than nine percent (9%). Interest shall be (i) calculated on the basis of
a 360 day year, and (ii) payable monthly, in arrears, commencing on May 1, 2006
and on the first business day of each consecutive calendar month thereafter
through and including the Maturity Date, and on the Maturity Date, whether by
acceleration or otherwise.
1.2 Contract Rate Payments. The Contract Rate shall be calculated on
the last business day of each calendar month hereafter (other than for increases
or decreases in the Prime Rate which shall be calculated and become effective in
accordance with the terms of Section 1.1) until the Maturity Date (each a
"DETERMINATION DATE") and shall be subject to adjustment as set forth herein.
Secured Non-convertible Revolving Note
ARTICLE II
EVENTS OF DEFAULT AND DEFAULT RELATED PROVISIONS
2.1 Events of Default. The occurrence of an Event of Default under the
Security Agreement shall constitute an event of default ("EVENT OF DEFAULT")
hereunder.
2.2 Default Interest. Following the occurrence and during the
continuance of an Event of Default, the Companies shall, jointly and severally,
pay additional interest on the outstanding principal balance of this Note in an
amount equal to two percent (2%) per month, and all outstanding Obligations,
including unpaid interest, shall continue to accrue interest at such additional
interest rate from the date of such Event of Default until the date such Event
of Default is cured or waived.
2.3 Default Payment. Following the occurrence and during the
continuance of an Event of Default, the Holder, at its option, may elect, in
addition to all rights and remedies of the Holder under the Security Agreement
and the other Ancillary Agreements and all obligations and liabilities of each
Company under the Security Agreement and the other Ancillary Agreements, to
require the Companies, jointly and severally, to make a Default Payment
("DEFAULT PAYMENT"). The Default Payment shall be one hundred thirty percent
130% of the outstanding principal amount of the Note, plus accrued but unpaid
interest, all other fees then remaining unpaid, and all other amounts payable
hereunder. The Default Payment shall be applied first to any fees due and
payable to the Holder pursuant to the Notes, the Security Agreement and/or the
Ancillary Agreements, then to accrued and unpaid interest due on the Notes and
then to the outstanding principal balance of the Notes. The Default Payment
shall be due and payable immediately on the date that the Holder has exercised
its rights pursuant to this Section 3.3.
ARTICLE III
MISCELLANEOUS
3.1 Cumulative Remedies. The remedies under this Note shall be
cumulative.
3.2 Failure or Indulgence Not Waiver. No failure or delay on the part
of the Holder hereof in the exercise of any power, right or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such power, right or privilege preclude other or further exercise thereof or
of any other right, power or privilege. All rights and remedies existing
hereunder are cumulative to, and not exclusive of, any rights or remedies
otherwise available.
3.3 Notices. Any notice herein required or permitted to be given shall
be in writing and shall be deemed effective given (a) upon personal delivery to
the party notified, (b) when sent by confirmed telex or facsimile if sent during
normal business hours of the recipient, if not, then on the next business day,
(c) five days after having been sent by registered or certified mail, return
receipt requested, postage prepaid, or (d) one day after deposit with a
nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to the
respective Company at the address provided for such Company in the Security
Secured Revolving Note 2
Agreement executed in connection herewith, and to the Holder at the address
provided in the Security Agreement for the Holder, with a copy to Xxxx X.
Xxxxxx, Esq., 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, xxxxxxxxx
number (000) 000-0000, or at such other address as the respective Company or the
Holder may designate by ten days advance written notice to the other parties
hereto.
3.4 Amendment Provision. The term "Note" and all references thereto, as
used throughout this instrument, shall mean this instrument as originally
executed, or if later amended or supplemented, then as so amended or
supplemented, and any successor instrument as such successor instrument may be
amended or supplemented.
3.5 Assignability. This Note shall be binding upon each Company and its
successors and assigns, and shall inure to the benefit of the Holder and its
successors and assigns, and may be assigned by the Holder in accordance with the
requirements of the Security Agreement. No Company may assign any of its
obligations under this Note without the prior written consent of the Holder, any
such purported assignment without such consent being null and void.
3.6 Cost of Collection. In case of any Event of Default under this
Note, the Companies shall, jointly and severally, pay the Holder the Holder's
reasonable costs of collection, including reasonable attorneys' fees.
3.7 Governing Law, Jurisdiction and Waiver of Jury Trial.
(a) THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAW.
(b) EACH COMPANY HEREBY CONSENTS AND AGREES THAT THE STATE OR
FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK SHALL HAVE
EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN ANY
COMPANY, ON THE ONE HAND, AND THE HOLDER, ON THE OTHER HAND, PERTAINING TO THIS
NOTE, THE SECURITY AGREEMENT OR ANY OF THE OTHER ANCILLARY AGREEMENTS OR TO ANY
MATTER ARISING OUT OF OR RELATED TO THIS NOTE, THE SECURITY AGREEMENT OR ANY OF
THE OTHER ANCILLARY AGREEMENTS PROVIDED, THAT EACH COMPANY ACKNOWLEDGES THAT ANY
APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF THE
COUNTY OF NEW YORK, STATE OF NEW YORK; AND FURTHER PROVIDED, THAT NOTHING IN
THIS NOTE SHALL BE DEEMED OR OPERATE TO PRECLUDE THE HOLDER FROM BRINGING SUIT
OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO COLLECT THE
OBLIGATIONS, TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE
OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE
HOLDER. EACH COMPANY EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH COMPANY
HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF PERSONAL
JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS. EACH COMPANY HEREBY WAIVES
PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH
ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT AND OTHER
PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE COMPANY AT
THE ADDRESS SET FORTH IN THE SECURITY AGREEMENT AND THAT SERVICE SO MADE SHALL
BE DEEMED COMPLETED UPON THE EARLIER OF THE COMPANY'S ACTUAL RECEIPT THEREOF OR
THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER POSTAGE PREPAID
Secured Revolving Note 3
(c) EACH COMPANY DESIRES THAT ITS DISPUTES BE RESOLVED BY A JUDGE
APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE
BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, EACH COMPANY HERETO WAIVES
ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO
RESOLVE ANY DISPUTE, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE
HOLDER, AND/OR ANY COMPANY ARISING OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL
TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS NOTE, THE
SECURITY AGREEMENT, ANY OTHER ANCILLARY AGREEMENT OR THE TRANSACTIONS RELATED
HERETO OR THERETO.
3.8 Severability. In the event that any provision of this Note is
invalid or unenforceable under any applicable statute or rule of law, then such
provision shall be deemed inoperative to the extent that it may conflict
therewith and shall be deemed modified to conform with such statute or rule of
law. Any such provision which may prove invalid or unenforceable under any law
shall not affect the validity or enforceability of any other provision of this
Note.
3.9 Maximum Payments. Nothing contained herein shall be deemed to establish or
require the payment of a rate of interest or other charges in excess of the
maximum permitted by applicable law. In the event that the rate of interest
required to be paid or other charges hereunder exceed the maximum rate permitted
by such law, any payments in excess of such maximum rate shall be credited
against amounts owed by the Companies to the Holder and thus refunded to the
Companies.
3.10 Security Interest. The Holder has been granted a security interest
(i) in certain assets of the Companies as more fully described in the Security
Agreement, (ii) pursuant to the Stock Pledge Agreement dated as of the date
hereof and (iii) certain other security and pledge agreements, if any.
3.11 Construction, etc. Each party acknowledges that its legal counsel
participated in the preparation of this Note and, therefore, stipulates that the
rule of construction that ambiguities are to be resolved against the drafting
party shall not be applied in the interpretation of this Note to favor any party
against the other. For the avoidance of doubt the Companies and the Holder
understand and agree that this Note is being issued by the Companies together
with that certain Secured Non-Convertible Term Note referred to in the Security
Agreement and that certain Secured Convertible Term Note referred to in the
Security Agreement as part of the same financing transaction.
Secured Revolving Note 4
3.12 Registered Obligation. This Note is intended to be a registered
obligation within the meaning of Treasury Regulation Section 1.871-14(c)(1)(i)
and the Company (or its agent) shall register the Note (and thereafter shall
maintain such registration) as to both principal and any stated interest.
Notwistanding any document, instrument ro agreement relating to this Note to the
contrary, transfer of this Note (or the right to any payments of principal or
stated interest thereunder) may only be effected by (i) surrender of this Note
and either the reissuance by the Company of this Note to the new holder or the
issuance by the Company of a new instrument to the new holder, or (ii) transfer
through a book entry system maintained by the Company (or its agent), within the
meaning of Treasury Regulation Section 1.871-14(c)(1)(i)(B).
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Secured Revolving Note 5
IN WITNESS WHEREOF, each Company has caused this Secured
Revolving Note to be signed in its name effective as of this 31st day of March
2006.
XSTREAM BEVERAGE NETWORKS, INC.
By: /s/
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Name:
Title:
WITNESS:
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TOTAL BEVERAGE NETWORK, INC.
By: /s/
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Name:
Title:
WITNESS:
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BEVERGE NETWORK OF CONNECTICUT, INC.
By: /s/
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Name:
Title:
WITNESS:
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Secured Revolving Note 6
BEVERAGE NETWORK OF MASSACHUSETTS, INC.
By: /s/
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Name:
Title:
WITNESS:
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BEVERAGE NETWORK OF HAWAII, INC.
By: /s/
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Name:
Title:
WITNESS:
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XSTREAM BRANDS, INC.
By: /s/
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Name:
Title:
WITNESS:
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BEVERAGE NETWORK OF MARYLAND, INC.
By: /s/
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Name:
Title:
WITNESS:
__________________________________
Secured Revolving Note 7
EXHIBIT A
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OTHER COMPANIES
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Total Beverage Network, Inc., a Florida corporation
Beverage Network of Connecticut, Inc., a Florida corporation
Beverage Network of Massachusetts, Inc., a Florida corporation
Beverage Network of Hawaii, Inc., a Florida corporation
Xstream Brands, Inc., a Florida corporation
Beverage Network of Maryland, Inc., a Florida corporation
Secured Non-convertible Revolving Note
