EXHIBIT 17
CONFIRMATION OF WAIVER
This Confirmation of Waiver (this "Confirmation"), dated as of December 28,
2001, is provided to Mendocino Brewing Company, Inc., a California corporation
("Borrower"), and United Breweries of America, Inc., a Delaware corporation
("Lender").
RECITALS
X. Xxxxxxxx and Xxxxxx entered into a Master Line of Credit Agreement dated
August 31, 1999 (the Master Line of Credit Agreement, together with all
amendments thereto shall hereinafter be referred to, collectively, as the
"Master Agreement"), which provides that on the terms and conditions contained
therein, Lender would make available to Borrower a credit facility in the
principal amount of $800,000.
B. The Master Agreement was subsequently amended on April 28, 2000, and February
12, 2001, to increase the principal amount available under the credit facility
to an aggregate of $1,600,000.
X. Xxxxxxxx to the Master Agreement, Xxxxxxxx made twelve (12) promissory notes
in favor of Xxxxxx (collectively, the "Notes").
D. Pursuant to Section 6 of the Notes, upon the issuance of any securities at a
price less than $1.50 per share, the conversion price of the Notes shall be
adjusted to reflect such issuance on a weighted average basis.
E. In exchange for all of the issued and outstanding capital stock of United
Breweries International (UK) Limited, Borrower issued and sold 5,500,000 shares
of common stock (the "Transaction").
F. In connection with the Transaction, Lender waived its rights to reduce its
conversion price to prevent additional dilution to the shareholders of Borrower.
X. Xxxxxxxx and Lender wish to confirm such waiver by this Confirmation.
CONFIRMATION
1. Waiver. Xxxxxx xxxxxx confirms that, effective as of August 13, 2001, Xxxxxx
has completely waived any and all of Xxxxxx's rights with regard to conversion
rate protection as set forth in Section 6 of each of the Notes.
2. Governing Law. This Confirmation 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.
3. Assignment; Successors and Assigns. This Confirmation shall bind and inure to
the benefit of the parties and their respective heirs, successors and assigns.
Exhibit 17 - page 1
IN WITNESS WHEREOF, this Confirmation has been duly executed as of the date set
forth above.
Lender:
UNITED BREWERIES OF AMERICA, INC.
a Delaware corporation
By: /s/ Xxxx Xxxxxxxxx
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Name: Xxxx Xxxxxxxxx
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Title: Secretary
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THE FOREGOING IS ACKNOWLEDGED AND AGREED:
Borrower:
MENDOCINO BREWING COMPANY, INC.
a California corporation
By: /s/ X. Xxxxxxxxx
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Name: X. Xxxxxxxxx
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Title: Secretary
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