UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
January 23, 2008
GLOBAL BEVERAGE SOLUTIONS, INC.
(Exact name of registrant as specified in its charter)
NEVADA 000-28027 90-0093439
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
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2 S. UNIVERSITY DR., SUITE 220
PLANTATION, FL 33324
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (954) 473-0850
N/A
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
On January 23, 2008, Global Beverage Solutions, Inc. (the "COMPANY") entered into a stock repurchase agreement (the "STOCK REPURCHASE AGREEMENT") with XStream Beverage Network, Inc. ("XSTREAM") by which the Company repurchased from XStream sixty million five hundred thousand (60,500,000) shares of the Company's common stock, par value $0.001 per share (the "COMMON STOCK"). As consideration for the repurchase of the Common Stock, the Company issued to XStream a convertible note in the principal amount of $700,000 (the "CONVERTIBLE NOTE"). The Convertible Note bears interest at the prime rate plus two percent and matures on October 31, 2008. Upon a default in the repayment of the Convertible Note or a failure to make the $500,000 Payment (as defined below), the holder of the Convertible Note, at its option, may convert the outstanding principal balance and any accrued interest (or any portion thereof) under the Convertible Note into shares of Common Stock at the conversion rate specified in the Stock Repurchase Agreement, and the holder of the Convertible Note may accelerate the maturity of the indebtedness evidenced by the Convertible Note. The Stock Repurchase Agreement and the Convertible Note are attached hereto, and incorporated in their entirety herein by reference, as EXHIBITS 10.1 and 10.2 respectively, and any description of the Stock Repurchase Agreement and the Convertible Note herein is qualified by reference to the full text of the Stock Repurchase Agreement and the Convertible Note. The Company plans to issue a press release announcing the stock repurchase transaction on January 29, 2008, which is attached hereto as EXHIBIT 99.1.
On January 23, 2008, and in connection with the repurchase of the Company's stock described in the previous paragraph of this Form 8-K, the Company and XStream entered into a second amendment ("AMENDMENT NO. 2") to a secured note with an original principal amount of $2,000,000 made by the Company in favor of XStream, dated January 31, 2007 and amended February 23, 2007 (the "SECURED NOTE"). Amendment No. 2 accelerated the maturity date of the note from March 31, 2011 to October 31, 2008 and removed a repayment provision requiring monthly payments of $25,000 so that now there are no required monthly payments under the Secured Note. As of January 23, 2008, the Secured Note had a remaining principal balance of $1,086,524.87. The Secured Note, the first amendment to the Secured Note, and Amendment No. 2 are attached hereto, and incorporated in their entirety herein by reference, as EXHIBITS 10.3 through 10.5 respectively, and any description of the Secured Note, the first amendment thereto and Amendment No. 2 is qualified by reference to the full text of each respective document.
On January 23, 2008, and in connection with the Stock Repurchase Agreement and Amendment No. 2, the Company entered into a side letter agreement with Laurus Master Fund, Ltd. ("LAURUS") and XStream (the "LETTER Agreement"). In connection with the Letter Agreement, XStream collaterally assigned to Laurus the Secured Note and the Convertible Note pursuant to a collateral assignment instrument which was acknowledged by the Company (the "COLLATERAL ASSIGNMENT"). Under the Letter Agreement, the Company agrees to pay to Laurus $500,000 in repayment of a portion of the outstanding balance of the Secured Note on or prior to May 1, 2008 (the "$500,000 PAYMENT"). Upon payment of the $500,000 Payment and delivery to Laurus of the original executed copies of the Collateral Assignment, the Secured Note, and the Convertible Note, Laurus agrees to release certain liens it has on the inventory of Beverage Network of Maryland, Inc., a wholly-owned
subsidiary of the Company, and XStream and Laurus agree to terminate a stock pledge agreement with respect to the stock of Beverage Network of Maryland, Inc. and a master security agreement securing collateral on the Company's obligations under the Secured Note. The Letter Agreement is attached hereto, and incorporated in its entirety herein by reference, as EXHIBIT 10.6, and any discussion of the Letter Agreement herein is qualified by reference to the full text of the Letter Agreement.
Pursuant to the terms of the Convertible Note, Amendment No. 2 and the Letter Agreement, if the Company issues any stock or sells any convertible notes prior to the payment in full of the Convertible Note and the Secured Note, the Company must use 35% of the proceeds from such issuance or sale to pay down first the Secured Note and then the Convertible Note (a "35% PAYMENT"), provided that any 35% Payment made on or before May 1, 2008 will apply to the payment of the $500,000 Payment.
ITEM 2.03 - CREATION OF A DIRECT FINANCIAL OBLIGATION
See Item 1.01 above, which is incorporated herein by reference.
ITEM 5.03 AMENDMENTS TO ARTICLES OF INCORPORATION OR BYLAWS; CHANGE IN FISCAL YEAR.
After an extensive review of the corporate records and files of the Company, the current management of the Company has not been able to locate a copy of the Company's Bylaws or any evidence that the Company has Bylaws, and the Board has determined that the Company does not have Bylaws. Based on this determination, on January 25, 2008, the Board passed a resolution, by unanimous written consent of the Board, adopting Bylaws of the Company to be effective as of the date of the aforementioned resolution.
A copy of the Company's Bylaws is attached hereto as Exhibit 3.1 and incorporated in its entirety herein by reference, and the foregoing discussion of the Company's Bylaws is qualified in its entirety by reference to the full text of the Bylaws.
In order to simplify review of and to clarify the Company's Articles of
Incorporation, the Company has restated, without amending, its Articles of
Incorporation. Because the Company's Articles of Incorporation were not amended
in connection with their restatement, the restatement of the Company's Articles
of Incorporation was authorized by unanimous written consent of the Board on
January 25, 2008 without stockholder approval in accordance with Title 7,
Section 78.403 of the Nevada Revised Statutes, which allows restatement of a
corporation's articles of incorporation by the board of directors without
stockholder approval, provided the articles of incorporation are not amended.
Title 7, Section 78.403 of the Nevada Revised Statutes also allows omission of certain provisions from the Company's Articles of Incorporation when restated pursuant to Board approval. In accordance with Title 7, Section 78.403, the Restated Articles of Incorporation of the Company omit (i) the names, addresses, signatures and acknowledgements of the incorporators, (ii) the names and addresses of the members of the past and present board of directors, and (iii) the name and address of the resident agent of the Company.
The foregoing description of the Company's Restated Articles of Incorporation is qualified in its entirety by reference to the full text of the Company's Restated Articles of Incorporation, a copy of which is attached hereto as Exhibit 3.2 and incorporated in its entirety herein by reference.
SECTION 9 - FINANCIAL STATEMENTS AND EXHIBITS
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits.
Exhibit No. Title
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3.1 Bylaws of the Company, adopted as of January 25, 2008.
3.2 Restated Articles of Incorporation of the Company, effective
as of January 25, 2008.
10.1 Letter Agreement for the Repurchase of Shares of Common
Stock and the Issuance of the Related Convertible Note,
dated as of January 23, 2008.
10.2 $700,000 Convertible Note by Global Beverage Solutions, Inc.
to XStream Beverage Network, Inc., dated as of January 23,
2008.
10.3 $2,000,000 Secured Promissory Note by Global Beverage
Solutions, Inc. to XStream Beverage Network, Inc., dated as
of January 31, 2007.
10.4 Amendment No. 1 to the $2,000,000 Secured Promissory Note by
Global Beverage Solutions, Inc. to XStream Beverage Network,
Inc., dated as of February 23, 2007.
10.5 Amendment No. 2 to the $2,000,000 Secured Promissory Note by
Global Beverage Solutions, Inc. to XStream Beverage Network,
Inc., dated as of January 23, 2008.
10.6 Side Letter Agreement by and among Laurus Master Fund, Ltd.,
Global Beverage Solutions, Inc., and XStream Beverage
Network, Inc., dated as of January 23, 2008.
99.1 Press Release, dated January 29, 2008.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: January 28, 2008 GLOBAL BEVERAGE SOLUTIONS, INC.
By: /S/ JERRY PEARRING
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Jerry Pearring
Chief Executive Officer
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Exhibit 3.1
ARTICLE I. STOCKHOLDERS' MEETINGS.
SECTION 1. ANNUAL MEETINGS.
(a) The annual meeting of the stockholders of the Corporation shall be held within five months after the close of the fiscal year of the Corporation at the principal office of the Corporation, or at any other place within or without the State of Nevada as determined by the Board of Directors and set forth in the notice of that meeting, and at such time and date as may be determined by the Board of Directors and set forth in the notice of that meeting. The business to be transacted at the annual meeting of the stockholders shall be the election of directors and such other business as may be properly brought before the meeting.
(b) If the election of directors shall not be held at the annual meeting, or at any adjournment of that meeting, the Board of Directors shall call a special meeting of the stockholders as soon as possible thereafter. At this meeting the election of directors shall take place, and the election and any other business transacted shall have the same force and effect as if taken at an annual meeting duly called and held.
SECTION 2. SPECIAL MEETINGS. Special meetings of the stockholders may be called at any time by the Board of Directors or by the President, and shall be called by the President or the Secretary at the written request of the holders of ten per cent (10%) or more of the shares then outstanding and entitled to vote thereat, or as otherwise required by law. Business transacted at any special meeting of the stockholders shall be limited to the purposes stated in the notice for such meeting.
SECTION 3. NOTICE OF MEETINGS.
(a) NOTICE, GENERALLY. Whenever stockholders are required or permitted to take action at a meeting, notice, in writing and signed by an officer of the Corporation, shall be given to each stockholder of record entitled to vote at the meeting stating the place, date and hour of the meeting, the purposes of the meeting and the means of remote communication, if any, by which the stockholders and proxy holders may be deemed to be present and vote at such meeting. Such notice shall be given in person, by mail or by any other means permitted by applicable law, not less than ten (10) nor more than fifty (50) days before the meeting. If mailed, it must be directed to the stockholder at the address last shown on the records of the Corporation, and upon the mailing of any such notice the service thereof is complete.
(b) NOTICE TO NON-RECORD STOCKHOLDERS; ADJOURNED MEETINGS. Notice of any meeting need not be given to any person who may become a stockholder of record after the mailing of such notices and prior to the meeting. Any meeting of the stockholders may adjourn from time to time to reconvene at the same or some other place. When a meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken, and at the adjourned meeting any business may be transacted that might have been transacted at the meeting as originally called. If, however, a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting as of the new record date.
(c) WAIVER OF NOTICE. A stockholder may waive the notice of meeting by attendance, either in person or by proxy, at the meeting, or by so stating in writing, either before or after the meeting, provided, however, that attendance at a meeting for the express purpose of objecting, at the beginning of the meeting, that the meeting was not lawfully called or convened shall not constitute a waiver of notice.
SECTION 4. CLOSING OF TRANSFER BOOKS; RECORD DATE.
(a) In lieu of closing the share records of the Corporation, the Board of Directors may fix, in advance, a date not more than fifty (50) days or less than ten (10) days prior to a meeting of the stockholders as the record date for the determination of stockholders entitled to receive notice of, or to vote at, any meeting of the stockholders, or to consent to any proposal without a meeting, or for the purpose of determining stockholders entitled to receive payment of any dividends, or allotment of any rights, or for the purpose of any other action. If no record date is fixed, the record date for the determination of stockholders entitled to notice of or to vote at a meeting of the stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if no notice is given, the business day on the day next preceding the day on which the meeting is held; the record date for determining stockholders for any other purpose shall be at the close of business on the day on which the resolution of the directors relating thereto is adopted.
(b) When a determination of stockholders entitled to notice of or to vote at any meeting has been made as provided in this section, except as otherwise provided by law, this determination shall apply to any adjournment of the meeting unless the Board of Directors fixes a new record date for the adjourned meeting. Notwithstanding the foregoing, the Board of Directors must fix a new record date if the meeting is adjourned to a date more than sixty (60) days after the date set for the original meeting.
SECTION 5. LIST OF STOCKHOLDERS. A complete list of the stockholders of the Corporation entitled to vote at the ensuing meeting, arranged in alphabetical order, and showing the address of and number of shares owned by each stockholder shall be prepared by the Secretary or other officer of the Corporation having charge of the stock transfer books. This list shall be kept on file for a period of at least ten (10) days prior to the meeting at the principle office of the Corporation and shall be subject to inspection during the usual business hours during such period by any stockholder. This list shall also be available at the meeting and shall be open to inspection by any stockholder at any time during the meeting. The original Stock Transfer Books shall be prima facie evidence as to who are the stockholders entitled to examine the list or to vote at any meeting of the stockholders. Failure to comply with the requirements of this section shall not affect the validity of any action taken at any meetings of the stockholders.
SECTION 6. QUORUM; ADJOURNMENT UPON LACK OF A QUORUM.
(a) Except as otherwise provided by law, the Articles of Incorporation or these Bylaws, a quorum at all meetings of the stockholders shall consist of the holders of a majority of the voting power of all outstanding shares of stock entitled to vote at the meeting present in person or by proxy. If voting by a class or series of stockholders is required for a matter, a majority of the voting power of that class or series that is present in person or by proxy constitutes a quorum for the purposes of transacting business with regards to that matter. The withdrawal of any stockholder after commencement of a meeting shall have no effect on the existence of a quorum after a quorum has been initially established at such meeting.
(b) Despite the absence of a quorum at any meeting of the stockholders, the stockholders, by a majority of the votes cast by holders of shares entitled to vote present at the meeting in person or by proxy, may adjourn the meeting. Upon reconvening such adjourned meeting, and when a quorum is present, any business may be transacted which might have been transacted at the meeting as originally called.
SECTION 7. VOTING; PROXIES.
(a) Except as otherwise provided by law, in the Articles of Incorporation or in these Bylaws or by the rules and regulations of any stock exchange applicable to the Corporation, any corporate action to be taken by a vote of the stockholders shall be decided by the affirmative vote of a majority of the voting power of shares of stock present in person or by proxy at a meeting with a quorum and entitled to vote thereon. Except as otherwise provided in the Articles of Incorporation, each share of stock entitled to vote at a meeting of the stockholders shall have, as to each matter submitted to a vote, one vote, whether voted in person or by proxy.
(b) A stockholder entitled to vote at a meeting of the stockholders may vote his or her shares through a proxy appointed by a written instrument signed by the stockholder or by a duly authorized attorney-in-fact of the stockholder and delivered to the Secretary of the Corporation. No proxy shall be valid after six (6) months from the date of its execution unless a longer period is expressly provided therein. A stockholder may revoke any proxy that is not irrevocable by attending the meeting and voting in person or by delivering to the Secretary a revocation of the proxy or by delivering a new proxy bearing a later date.
SECTION 8. ACTION OF STOCKHOLDERS BY WRITTEN CONSENT. Any action required or permitted to be taken at a meeting of the stockholders may be taken without a meeting if, before or after the action, a written consent thereto is signed by stockholders holding at least a majority of the voting power, except that if a different proportion of voting power is required by law, the Articles of Incorporation or these Bylaws for such an action at a meeting, then written consent by that proportion is required.
SECTION 9. CONDUCT OF MEETINGS. The Board of Directors may adopt by resolution such rules and regulations for the conduct of the meeting of stockholders as it shall deem appropriate. At each meeting of stockholders the President, or in the absence of the President, the most senior Vice President, (based on number of years as an officer of the Corporation), or in absence of the President and all Vice Presidents, a chairman of the meeting to be selected by a majority of the stockholders entitled to vote at the meeting who are present in person or by proxy, shall preside over the meeting. Except to the extent inconsistent with such rules and regulations as are adopted by the Board of Directors, the person presiding over any meeting of the stockholders shall have the right and authority to convene and to adjourn the meeting, to establish an agenda for the meeting, to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such person, are appropriate for the proper conduct of the meeting. The Secretary, or in his or her absence, one of the Assistant Secretaries, shall act as secretary of the meeting.
ARTICLE II. DIRECTORS
SECTION 1. NUMBER; QUALIFICATION; ELECTION; TERM; DUTIES AND POWERS.
(a) NUMBER AND QUALIFICATION. The property, affairs and business of the Corporation shall be managed by a Board of Directors. The current number of directors on the Board of Directors is three (3). The size of the Board of Directors may be changed by resolution of the Board of Directors to consist of no less than one (1) director and no more than seven (7) directors. Each director shall be at least eighteen (18) years of age, but directors need not be stockholders of the Corporation.
(b) ELECTION AND TERM. Except as otherwise provided in these Bylaws, directors will be elected by a plurality of the voting power of shares entitled to vote thereon present in person or by proxy at an annual meeting of the stockholders with a quorum present. Each director shall serve for a term of one year, provided that each director shall continue to serve as a director until his or her successor shall be duly elected and qualified, or until his or her prior death, resignation or removal. Any directorship to be filled by reason of an increase in the number of directors may be filled by the Board of Directors, but only for a term continuing until the next election of directors by the stockholders and until the due election and qualification of such director's successor.
(c) DUTIES AND POWERS. The Board of Directors shall be responsible for the control and management of the affairs, property and interests of the Corporation and may exercise all powers of the corporation, except as are otherwise expressly conferred upon or reserved to the stockholders by law, the Articles of Incorporation or these Bylaws.
SECTION 2. MEETINGS OF THE DIRECTORS; NOTICE; QUORUM AND ACTION.
(a) REGULAR MEETINGS. Regular meetings of the Board of Directors may be held without notice at such times and at such places, within or without the State of Nevada, as shall from time to time be determined by the Board of Directors.
(b) SPECIAL MEETINGS. Special meetings of the Board of Directors may be held at any time or place, within or without the State of Nevada, whenever called by the Chairman of the Board, the President or a Vice President or by any two or more directors then serving on the Board of Directors. Notice of special meetings of the Board of Directors shall be mailed directly to each Director, addressed to him at his residence or usual place of business at least five (5) days before the day on which the meeting is to be held, or shall be sent to him at such place by electronic mail or facsimile or shall be delivered to him personally not later than the day before the day on which the meeting is to be held. A notice, or waiver of notice, except as expressly required herein need not specify the purpose of the meeting. A director may waive notice of a meeting of the Board of Directors by attendance at the meeting or by so stating in writing, either before or after the meeting, provided, however, that attendance at a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business on the grounds that the meeting has not been lawfully called or convened shall not constitute a waiver of notice.
(c) QUORUM. At all meetings of the Board of Directors, the presence of a majority of the entire Board of Directors shall constitute a quorum for the transaction of business, except as otherwise may be provided by law or the Articles of Incorporation. If at any meeting of the Board of Directors there shall be less than a quorum present, a majority of those present may adjourn the meeting from time to time without further notice until a quorum shall have been obtained.
(d) ACTION AT A MEETING OF THE BOARD OF DIRECTORS. At all meetings of the Board of Directors, each director present shall have one (1) vote, irrespective of the number of shares of stock, if any, which he or she may hold. Except as otherwise provided by law, the Articles of Incorporation or these Bylaws, the vote of a majority of the directors present at any meeting at which a quorum is present shall be the act of the Board of Directors.
(e) ACTION BY WRITTEN CONSENT IN LIEU OF A MEETING. Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting if all directors or members of such committee, as the case may be, consent thereto in writing.
SECTION 3. REMOVAL AND RESIGNATION OF DIRECTORS; VACANCIES.
(a) REMOVAL. Any director or directors may be removed from office, without assignment of any reason, by a vote of not less than two thirds (2/3) of the voting power of the issued and outstanding stock entitled to vote, or not less than two thirds (2/3) of the class or series of stock, as the case, may be, that elected the director or directors to be removed.
(b) RESIGNATION. Any director may resign at any time by giving written notice to the Board of Directors, the President or the Secretary. Unless otherwise specified in such written notice, such resignation shall take effect upon receipt thereof by the Board of Directors, or by such officer, and acceptance of such resignation shall not be necessary to make it effective.
(c) VACANCIES. Except as otherwise provided in these Bylaws, any vacancies on the Board of Directors resulting from death, resignation, disqualification, removal from office or other cause may be filled by a majority vote of the remaining directors then in office, although less than a quorum, or if only one director remains, by that sole remaining director, and directors so chosen shall hold office until the expiration of the term of office of the director whom he or she has replaced or until his or her successor is duly elected and qualified, provided, however, that the Board of Directors may only fill a vacancy on the Board of Directors resulting from removal by the stockholders of a director or directors if the stockholders fail to fill such vacancy as provided in the following sentence. The stockholders may fill any vacancies on the Board of Directors resulting from the removal of a director or directors at the meeting of the stockholders at which, or by the same written consent of the stockholders by which, as the case may be, the stockholders voted to remove the director or directors, such vacancies to be filled by the same vote of the stockholders as would be required to elect directors at an annual meeting of the stockholders.
SECTION 4. COMPENSATION. Directors and members of any committee of the Board of Directors shall be entitled to any reasonable compensation for their services as such as shall be fixed from time to time by resolution of the Board of Directors, and shall also be entitled to reimbursement for any reasonable expense incurred by such director in connection with the performance of his or her duties as such. The compensation of directors may be on any basis as determined in the resolution of the Board of Directors. Any director receiving compensation under this provision shall not be barred from serving the Corporation in any other capacity and receiving reasonable compensation for such other services.
SECTION 5. COMMITTEES. The Board of Directors, by resolution adopted by a majority of the entire Board, may from time to time designate from among its members an executive committee and such other committees, and alternate members thereof, as they deem desirable, to serve at the pleasure of the Board of Directors. Each committee shall consist of at least one member of the Board of Directors, with such powers and authority (to the extent permitted by law) as may be conferred or authorized by resolution of the Board of Directors.
SECTION 6. DIVIDENDS. Subject to applicable law and the Articles of Incorporation, dividends may be declared and paid of any funds available therefor, as often, in such amounts, and at such time or times as the Board of Directors may determine.
SECTION 7. INDEMNITY.
(a) Any person made a party to any action, suit or proceeding, by reason of the fact that such person, his or her testator or intestate representative is or was a director, officer or employee of the Corporation, or of any Corporation in which he or she served as such at the request of the Corporation, shall be indemnified by the Corporation against reasonable expenses, including attorneys' fees, judgments, fines and amounts paid in settlement actually and necessarily incurred by such person in connection with the defense of such action, suit or proceedings, or in connection with any appeal therein, except in relation to matters as to which such person shall be adjudged in such action, suit or proceeding, or in connection with any appeal therein that such officer, director or employee is liable for breach of his or her duties to the Corporation or its stockholders where such breach involves intentional misconduct, fraud or knowing violation of law.
(b) The foregoing right of indemnification shall not be deemed exclusive of any other rights to which any officer or director or employee may be entitled apart from the provisions of this section.
(c) The amount of indemnity to which any officer or any director may be entitled shall be fixed by the members of the Board of Directors not a party to such action, suit or proceeding, except that in any case where there is no such disinterested majority of the Board of Directors available, the amount shall be fixed by arbitration pursuant to the then existing rules of the American Arbitration Association.
ARTICLE III. OFFICERS.
SECTION 1. NUMBER; QUALIFICATIONS; ELECTION AND TERM OF OFFICE.
(a) The officers of the Corporation shall consist of a President, a Secretary, a Treasurer, and such other officers, including a Chairman of the Board of Directors and one or more Vice Presidents, as the Board of Directors may from time to time deem advisable. Any officer other than the Chairman of the Board of Directors may be, but is not required to be, a director of the Corporation. Any two or more offices may be held by the same person.
(b) The officers of the Corporation shall be elected by the Board of Directors at any regular or special meeting of the Board of Directors or by written consent of the Board of Directors.
(c) Each officer shall hold office for the term for which he or she is elected and until such officer's successor is elected and qualified or until such officer's earlier death, resignation or removal.
SECTION 2. RESIGNATION; REMOVAL; VACANCIES.
(a) REMOVAL. Any officer may be removed, either with or without cause, and a successor elected by a majority vote of the Board of Directors at any time.
(b) RESIGNATION. Any officer may resign at any time by giving written notice of such resignation to the Board of Directors, or to the President or the Secretary of the Corporation. Unless otherwise specified in such written notice, such resignation shall take effect upon receipt thereof by the Board of Directors or by such officer, and the acceptance of such resignation shall not be necessary to make it effective.
(c) VACANCIES. A vacancy in any office by reason of death, resignation, removal, inability to act, disqualification, or any other cause, may at any time be filled for the unexpired portion of the term of the office by a majority vote of the Board of Directors.
SECTION 3. DUTIES OF OFFICERS. Officers of the Corporation shall, unless otherwise provided by the Board of Directors, each have such powers and duties as generally pertain to their respective offices as well as such powers and duties as may be from time to time specifically conferred or imposed by the Board of Directors. The President shall be the Chief Executive Officer of the Corporation.
SECTION 4. SURETIES AND BONDS. If the Board of Directors shall so require, any officer, employee or agent of the Corporation shall execute in favor of the Corporation a bond in such sum, and with such surety or sureties as the Board of Directors may direct, conditioned upon the faithful performance of his duties to the Corporation, including responsibility for negligence and for the accounting for all property, funds or securities of the Corporation which may come into his hands.
SECTION 5. SHARES OF OTHER CORPORATIONS. Whenever the Corporation is the holder of shares of any other corporation, any right or power of the Corporation as such stockholder (including attendance, acting and voting at stockholders' meetings and execution of waivers, consents, proxies or other instruments) may be exercised on behalf of the Corporation by the President, any Vice President, or such other person as the Board of Directors may authorize.
SECTION 6. OFFICER COMPENSATION. The compensation of all officers of the Corporation shall be fixed by the Board of Directors. No officer shall be ineligible to receive such compensation by reason of the fact that he or she is a director of the Corporation receiving compensation therefor.
ARTICLE IV. SHARES OF STOCK.
SECTION 1. CERTIFICATE OF STOCK.
(a) The certificates representing the shares of stock of the Corporation shall be in such form as shall be adopted by the Board of Directors, and shall be numbered and registered in the order issued. Such certificates shall bear the holder's name and the number of shares, and shall be signed by (i) the Chairman of the Board, the President or a Vice President, and (ii) the Secretary or Treasurer, or any Assistant Secretary or Assistant Treasurer, and shall bear the corporate seal. Where any certificate is manually signed by a transfer agent or a transfer clerk and by a registrar, the signatures of the officers upon that certificate may be facsimiles, engraved or printed. In case any officer who has signed or whose facsimile signature has been placed upon any certificate shall have ceased to be an officer before the certificate is issued, it may be issued by the corporation with the same effect as if that officer had not ceased to be so at the time of its issue.
(b) No certificate representing shares shall be issued until the full amount of consideration therefor has been paid, except as otherwise permitted by law.
(c) To the extent permitted by law, the Board of Directors may authorize the issuance of certificates for fractions of a share which shall entitle the holder to exercise voting rights, receive dividends and participate in liquidating distributions, in proportion to the fractional holdings; or it may authorize the payment in cash of the fair value of fractions of a share as of the time when those entitled to receive such fractions are determined; or it may authorize the issuance, subject to such conditions as may be permitted by law, of scrip in registered or bearer form over the signature of an officer or agent of the Corporation, exchangeable as therein provided for full shares, but such scrip shall not entitle the holder to any rights of a stockholder, except as therein provided.
SECTION 2. TRANSFERS OF SHARES.
(a) Transfers of shares of stock of the Corporation shall be made on the stock records of the Corporation only by the holder of record thereof, in person or by his duly authorized attorney, upon surrender for cancellation of the certificate or certificates representing such shares, with an assignment or power of transfer endorsed thereon or delivered therewith, duly executed, with such proof of the authenticity of the signature and of authority to transfer and of payment of transfer taxes as the Corporation or its agents may require.
(b) The Corporation shall be entitled to treat the holder of record of any share or shares of stock of the Corporation as the absolute owner thereof for all purposes and, accordingly, shall not be bound to recognize any legal, equitable or other claim to, or interest in, such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise expressly provided by law.
SECTION 3. TRANSFER AND REGISTRY AGENTS. The Corporation may from time to time maintain one or more transfer offices or agents and registry offices or agents at such place or places as may be determined from time to time by the Board of Directors.
SECTION 4. LOST OR DESTROYED CERTIFICATES. The holder of any certificate
representing shares of stock of the Corporation shall immediately notify the
Corporation of any loss or destruction of the certificate representing the same.
The Corporation may issue a new certificate in the place of any certificate
theretofore issued by it alleged to have been lost or destroyed, and the Board
of Directors, in its discretion may require the owner of the lost, stolen or
destroyed certificate, or his or her legal representative, (a) to produce such
evidence of loss or destruction as the Board of Directors may require, and/or
(b) to give the Corporation a bond in such sum as the Board of Directors may
reasonably direct, and with such surety or sureties as may be satisfactory to
the Board of Directors, to indemnify the Corporation against any claims, loss,
liability or damage it may suffer on account of the issuance of the new
certificate. A new certificate may be issued without requiring any such evidence
or bond when, in the judgment of the Board of Directors, it is proper so to do.
ARTICLE V. FISCAL YEAR.
The fiscal year of the Corporation shall be fixed by the Board of Directors from time to time in accordance with applicable law.
ARTICLE VI. CORPORATE SEAL.
The corporate seal for the Corporation, if any, shall be in such form as shall be approved from time to time by the Board of Directors.
ARTICLE VII. AMENDMENTS.
SECTION 1. BY STOCKHOLDERS. All Bylaws of the Corporation shall be subject to alteration or repeal, and new by-laws may be made, by the affirmative vote of stockholders holding of record in the aggregate at least a majority of the outstanding shares entitled to vote in the election of directors at any annual or special meeting of the stockholders, provided that the notice or waiver of notice of such meeting shall have summarized or set forth in full therein, the proposed amendment.
SECTION 2. BY DIRECTORS. The Board of Directors shall have the power to make, adopt, alter, amend and repeal, from time to time, the Bylaws of the Corporation, provided, however, that the stockholders entitled to vote with respect thereto as in this Article VII above-provided may alter, amend or repeal Bylaws made by the Board of Directors. Further provided that the Board of Directors shall have no power to change the quorum for meetings of stockholders or the Board of Directors, or to change any provisions of the Bylaws with respect to the removal of directors or the filling of vacancies in the Board of Directors resulting from the removal of such directors by the stockholders. If any Bylaw regulating an impending election of directors is adopted, amended or repealed by the Board of Directors, there shall be set forth in the notice of the next meeting of stockholders for the election of directors, the Bylaws so adopted, amended or repealed.
The undersigned certifies that the foregoing Amended and Restated Bylaws have been adopted as the Bylaws of the Corporation.
DATED this 25th day of January, 2008.
GLOBAL BEVERAGE SOLUTIONS, INC.
By: /s/ Jerry Pearring
-------------------------------------
Jerry Pearring
President and Chief Executive Officer
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Exhibit 3.2
RESTATED
ARTICLES OF INCORPORATION
OF
GLOBAL BEVERAGE SOLUTIONS, INC.
I.
The name of the corporation (hereinafter referred to as "the corporation") is:
GLOBAL BEVERAGE SOLUTIONS, INC.
II.
Offices for the transaction of any business of the corporation and where meetings of the Board of Directors and of the Stockholders may be held, may be established and maintained in Nevada or any other state, territory or possession of the United States of America or in any foreign country.
III.
The nature of the business and objects and purposes proposed to be transacted, promoted or carried on by the corporation is to transact any lawful activity or business as the Board of Directors may from time to time direct. The period of duration of the corporation is perpetual.
IV.
The amount of total authorized stock of the Corporation is one billion (1,000,000,000) shares, of which nine hundred fifty million (950,000,000) shares shall be designated Common Stock with a par value of $0.001 per share, and fifty million (50,000,000) shares shall be designated Preferred Stock, with a par value of $0.001 per share.
V.
The members of the governing Board of the corporation shall be styled Directors, and the initial number thereof shall be one. The number of Directors may from time to time be increased or decreased in such manner as shall be provided by the By-Laws of the corporation. Directors need not be Stockholders, but shall be full of age, and at least one shall be a citizen of the United States.
VI.
The capital stock of the corporation, after the amount of the subscription price has been paid in money, property or services as the Directors shall determine, shall not be subject to assessment to pay debts of the corporation, nor for any other purpose, and no stock issued as fully paid up shall ever be assessable or assessed, and the Articles of Incorporation shall not be amended in this particular.
VII.
Subject to the provisions of this article and the Nevada Revised Statutes, the corporation shall indemnify any and all of its existing and former directors, officers, employees and agents against all expenses incurred by them and each of them, including, but not limited to, legal fees, judgments, penalties and amounts paid in settlements or compromise, which may arise or be incurred, rendered or levied in any legal action brought or threatened against any of them for or on account of any action or omission other than that which involves intentional misconduct, fraud, or a knowing violation of law or the payment of dividends in violation of NRS 78.300 and alleged to have been committed while acting within the scope of employment as a director, officer, employee or agent of the corporation whether or not any action is or has been filed against them and whether or not any settlement or compromise is approved by a court. Indemnification shall be made by the corporation whether the legal action brought or threatened is by or in the right of the corporation or any other person.
Whenever any existing or former director, officer, employee or agent shall report to the President of the corporation or the Chairman of the Board of Directors that he or she has incurred or may incur expenses, including, but not limited to, legal fees, judgments, penalties and amounts paid in settlement or compromise in a legal action brought or threatened against him or her for or on account of any action or omission alleged to have been committed while acting within the scope of his or her employment as a director, officer, employee or agent of the corporation, the Board of Directors shall, at its next regular or at a special meeting held within a reasonable time thereafter, determine in good faith whether, in regard to the matter involved or in the action or contemplated action, such person acted, failed to act or refused to act willfully or with gross negligence or with fraudulent or criminal intent.
DULY EXECUTED and delivered by the undersigned on July 25, 2008.
GLOBAL BEVERAGE SOLUTIONS, INC.
By: /s/ Jerry Pearring
-------------------------------------
Jerry Pearring
President and Chief Executive Officer
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Exhibit 10.1
GLOBAL BEVERAGE SOLUTIONS, INC.
2 S. University Drive, Suite 220
Plantation, Florida 33324
January 23, 2008
Mr. Ronald Ratner
Chief Executive Officer and President
XStream Beverage Network, Inc.
18851 N.E. 29th Avenue, Suite 700
Aventura, Florida 33180
Re: REPURCHASE OF SHARES OF COMMON STOCK AND ISSUANCE OF RELATED CONVERTIBLE NOTE
Dear Mr. Ratner:
This letter agreement sets forth our understanding regarding the repurchase by Global Beverage Solutions, Inc. ("Global Beverage") of 60,500,000 shares (the "Shares") of Global Beverage's common stock, par value $0.001 per share (the "Common Stock"), from XStream Beverage Network, Inc. ("XStream").
In consideration of the mutual agreements and understandings set forth herein, the parties hereto hereby agree as follows:
1. AGREEMENT TO SELL AND REPURCHASE. Upon the basis of the representations and warranties and subject to the terms and conditions herein set forth, XStream hereby agrees to sell, and Global Beverage hereby agrees to repurchase, the Shares for an aggregate purchase price of $700,000 (the "Purchase Price").
2. PAYMENT AND DELIVERY.
(a) Payment of the Purchase Price for the Shares shall be made by delivery by Global Beverage to XStream of a convertible note in the principal amount of the Purchase Price and in the form attached hereto as EXHIBIT A (the "Convertible Note"), against delivery of the Shares by XStream to Global Beverage. The Convertible Note is convertible into Common Stock. The shares of Common Stock issuable upon conversion of the Convertible Note are referred to herein as the "Conversion Shares." The Convertible Note and the Conversion Shares are collectively referred to herein as the "Securities."
(b) Payment of the Purchase Price and delivery of the Shares shall be made within three (3) business days after the execution by the parties of this Agreement.
3. NATURE OF OFFERING; LEGEND.
(a) The offer and sale of the Securities is being made in reliance upon the provisions of Section 4(2) of the Securities Act of 1933 (the "Securities Act") and Rule 506 of Regulation D promulgated under the Securities Act.
(b) Each certificate or other instrument for capital stock issued upon the conversion of the Convertible Note shall bear such restrictive legends as Global Beverage shall deem necessary or advisable pursuant to applicable federal and state securities laws including the following:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR UNDER ANY
STATE OR OTHER SECURITIES LAWS. SUCH SECURITIES HAVE BEEN ACQUIRED FOR
INVESTMENT PURPOSES AND MAY NOT BE OFFERED FOR SALE, HYPOTHECATED,
SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF, NOR WILL ANY ASSIGNEE OR
TRANSFEREE THEREOF BE RECOGNIZED BY THE ISSUER AS HAVING AN INTEREST IN
SUCH SECURITIES, IN THE ABSENCE OF, WITH RESPECT TO EACH OF THE
SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS, (1) AN
EFFECTIVE REGISTRATION STATEMENT WITH RESPECT TO SAID ACT OR LAW, OR
(2) AN OPINION OF COUNSEL, WHICH OPINION OF COUNSEL SHALL BE
SATISFACTORY TO THE ISSUER, TO THE EFFECT THAT THE TRANSACTION BY WHICH
SUCH SECURITIES WILL BE OFFERED FOR SALE, HYPOTHECATED, SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF, IS EXEMPT FROM OR OTHERWISE IN
COMPLIANCE WITH THE REGISTRATION REQUIREMENTS OF SAID ACT OR LAW."
4. OPTIONAL CONVERSION.
(a) From and after the date of an Event of Default (as defined below), XStream shall have the right, at its option, by giving written notice to Global Beverage at its principal office at any time prior to the cure of such Event of Default by Global Beverage, to convert in whole or in part the principal amount of the Convertible Note and any accrued interest thereon into Conversion Shares, at the Conversion Rate (as hereinafter defined). The number of Conversion Shares issuable upon conversion of any Conversion Amount (as hereinafter defined) shall be determined by dividing (x) such Conversion Amount by (y) the Conversion Price (as hereinafter defined) (such formula being referred to herein as the "Conversion Rate"). The "Conversion Amount" means the portion of the principal amount of the Convertible Note and any accrued interest thereon to be converted with respect to which this determination is being made. The "Conversion Price" shall be equal to $0.01157024793, subject to equitable adjustment in the event of any stock split, combination, reclassification or similar event.
(b) The date on which notice of conversion is given (the "Conversion Date") shall be deemed to be the date on which XStream faxes or otherwise delivers the conversion notice ("Notice of Conversion") to Global Beverage so that it is received by Global Beverage on or before such specified date, provided that, if such conversion would convert the entire remaining principal of the Convertible Note, XStream shall deliver to Global Beverage the original Convertible Note being converted no later than five (5) business days thereafter. As soon as practicable after any Conversion Date, but in any event within 3 business days thereafter, Global Beverage, at its expense, will cause to be issued in the name of and delivered to XStream, a certificate or certificates for the number of fully paid and non-assessable Conversion Shares to which XStream shall be entitled on such conversion. No fractional shares of Common Stock will be issued on conversion of the Convertible Note. If on conversion of the Convertible Note a fraction of a share results, Global Beverage will round such fraction of a share of Common Stock up to the nearest whole share.
(c) Notwithstanding anything to the contrary contained herein and in the Convertible Note, the Convertible Note may not be converted, in whole or in part, into Conversion Shares unless and until any then-applicable requirements of all federal and state securities laws and regulatory agencies charged with enforcing securities laws shall have been fully complied with to the satisfaction of Global Beverage and its counsel; PROVIDED, HOWEVER, that Global Beverage shall at all times use its best efforts to comply with such requirements. Global Beverage may, in its reasonable discretion, condition any conversion of the Convertible Note upon XStream's delivery to Global Beverage of a written agreement, in form and substance satisfactory to Global Beverage, whereby XStream makes, at the time of conversion, such representations and warranties to and for the benefit of Global Beverage as are comparable to the representations and warranties of XStream set forth herein as and to the extent applicable to the issuance of the Conversion Shares upon conversion of the Convertible Note.
5. REPRESENTATIONS AND WARRANTIES OF XSTREAM. XStream represents and warrants to Global Beverage that:
(a) XStream has the full power and authority to enter into, execute and deliver this letter agreement and perform the obligations contained herein;
(b) the execution and delivery by XStream of this letter agreement and the performance by it of its obligations contemplated in this letter agreement have been duly authorized by all necessary corporate or other action of XStream;
(c) the execution, delivery and performance of this letter agreement by XStream will not conflict with or result in any material breach or violation of any of the terms and conditions of, or constitute (with notice or lapse of time or both) a default under, any instrument, contract or other agreement to which XStream is a party or by which it is bound;
(d) XStream has not entered into any other agreement or understanding with any person or entity relating to the sale, hypothecation, pledge, assignment, disposal or transfer of the Shares and is the owner of, and has good and marketable title to the Shares, free and clear of all liens, pledges and encumbrances of any kind, other than liens granted in favor of Laurus Master Fund, Ltd. ("Laurus");
(e) XStream has such knowledge and experience in financial and business matters, including investments of the type represented by the Securities, is capable of evaluating the merits of investment in Global Beverage and can bear the economic risk of an investment in the Securities;
(f) XStream is an "accredited investor" as such term is defined in Rule 501 of Regulation D under the Securities Act;
(g) XStream is acquiring the Securities for investment purposes only, for its own account and not with a view to, or for resale in connection with, the distribution or other disposition thereof in contravention of the Securities Act or any state securities law, without prejudice, however, to XStream's right at all times to sell or otherwise dispose of all or any part of the Securities under an exemption from registration available under the Securities Act and other applicable state securities laws;
(h) XStream acknowledges and agrees that the Convertible Note and the Conversion Shares issuable upon conversion of the Convertible Note are subject to, and that XStream will be bound by, the additional transfer restrictions set forth in Section 5 of the Convertible Note;
(j) XStream understands that the Securities have not been and are
not being registered under the Securities Act or any state securities laws, and
may not be offered for sale, sold, assigned or transferred unless (A)
subsequently registered thereunder, (B) XStream shall have delivered to Global
Beverage an opinion of counsel, in a generally acceptable form, to the effect
that such Securities to be sold, assigned or transferred may be sold, assigned
or transferred pursuant to an exemption from such registration requirements, or
(C) XStream provides Global Beverage with reasonable assurances (in the form of
seller and broker representation letters) that such Securities can be sold,
assigned or transferred pursuant to Rule 144 or Rule 144(k) promulgated under
the Securities Act, as amended (or a successor rule thereto) (collectively,
"RULE 144"), in each case following the applicable holding period set forth
therein; (ii) any sale of the Securities made in reliance on Rule 144 may be
made only in accordance with the terms of Rule 144 and further, if Rule 144 is
not applicable, any resale of the Securities under circumstances in which the
seller (or the person through whom the sale is made) may be deemed to be an
underwriter (as that term is defined in the Securities Act) may require
compliance with some other exemption under the Securities Act or the rules and
regulations thereunder; and (iii) neither Global Beverage nor any other person
is under any obligation to register the Securities under the Securities Act or
any state securities laws or to comply with the terms and conditions of any
exemption thereunder; and
(k) XStream has received all documents, records, books and other publicly available information pertaining to XStream's investment in Global Beverage that have been requested by XStream. Global Beverage is subject to the periodic reporting requirements of the Securities Exchange Act of 1934 (the "Exchange Act"), and XStream has reviewed or received copies of all documents that Global Beverage has filed under the Exchange Act that have been requested by it.
6. REPRESENTATIONS AND WARRANTIES OF GLOBAL BEVERAGE. Global Beverage represents and warrants to XStream and Laurus that:
(a) Global Beverage has the full power and authority to enter into, execute and deliver this letter agreement and perform the obligations contained herein;
(b) the execution and delivery by Global Beverage of this letter agreement and the performance by it of its obligations contemplated in this letter agreement have been duly authorized by all necessary corporate or other action of Global Beverage; and
(c) the execution, delivery and performance of this letter agreement by Global Beverage will not conflict with or result in any material breach or violation of any of the terms and conditions of, or constitute (with notice or lapse of time or both) a default under, any instrument, contract or other agreement to which Global Beverage is a party or by which it is bound.
7. EVENTS OF DEFAULT. The occurrence of any of the following shall constitute an "Event of Default" under the Convertible Note:
(a) Default in the payment when due of the principal of the indebtedness evidenced by the Convertible Note or any interest due thereon in accordance with the terms of the Convertible Note; and
(b) Failure of Global Beverage to make a payment, pursuant to that certain letter agreement, dated even date herewith, by and between Global Beverage and Laurus, to Laurus in the amount of $500,000 on or before May 1, 2008 (the "$500,000 Payment"); PROVIDED that any 35% Payment (as defined below) made by Global Beverage on or before May 1, 2008 shall be applied to and shall reduce the amount of such $500,000 Payment as set forth in SECTION 8(A) below.
8. COVENANTS OF GLOBAL BEVERAGE.
(a) In the event that Global Beverage receives proceeds from the sale of shares of its Common Stock or the issuance of convertible debt at a time when the Convertible Note has not been repaid in full, then Global Beverage shall use 35% of the net proceeds received in connection with such sale or issuance (a "35% Payment") to repay the outstanding principal amount of the Convertible Note and/or that certain $2,000,000 Secured Promissory Note by Global Beverage for the benefit of XStream, dated as of January 31, 2007 and amended on February 23, 2007 and again on January 23, 2008 (the "Secured Note"). Any 35% Payment shall first be used to pay down in full the Secured Note, and after the Secured Note has been paid in full, any 35% Payment thereafter (or remaining portion thereof) shall be used to pay down the Convertible Note. Global Beverage shall not have to pay any portion of a 35% Payment beyond any such amount that pays down in full both the Secured Note and the Convertible
Note. Furthermore, any 35% Payment paid on or before May 1, 2008 shall be deemed to satisfy all or a portion, as the case may be, of the $500,000 Payment to the extent of the dollar amount of such 35% Payment.
(b) At all times from and after the date hereof and until the maturity date of the Convertible Note, Global Beverage shall maintain a sufficient number of authorized shares of Common Stock to be available for issuance in a timely manner upon conversion of the Convertible Note in accordance with the terms hereof and thereof.
9. GOVERNING LAW. This letter agreement shall be governed by and construed in accordance with the internal laws of the State of New York, without regard to the principles of conflict of laws that would provide for application of another law.
10. ENTIRE AGREEMENT; COUNTERPARTS. This letter agreement and the Convertible Note contain the entire agreement between the parties with respect to the Shares and the Convertible Note. Any oral or written agreements, representations, warranties, written inducements, or other communications made prior to the execution of this letter agreement with respect to the Shares and the Convertible Note shall be null and void. This letter agreement may be executed in counterparts, each of which when taken together shall constitute an original of this letter agreement.
11. NOTICES. All notices, other communications or documents provided for or permitted to be given hereunder shall be made in writing and shall be given either personally by hand-delivery, by facsimile transmission, by mailing the same in a sealed envelope, registered first-class mail, postage prepaid, return receipt requested, or by reputable courier guaranteeing overnight delivery:
(a) if to XStream, to:
XStream Beverage Network, Inc. 18851 N.E. 29th Avenue, Suite 700 Aventura, Florida 33180 Attention: Mr. Ronald Ratner Fax: (786) -
(b) if to Global Beverage, to:
Global Beverage Solutions, Inc. 2 S. University Drive, Suite 220 Plantation, Florida 33324 Attention: Jerry Pearring Fax: (954) 337-0522
Each party, by written notice given to each other in accordance with this paragraph 11 may change the address to which notices, other communications or documents are to be sent to such party. All notices, other communications or documents shall be deemed to have been duly given: (i) at the time delivered by
hand, if personally delivered; (ii) when receipt is acknowledged orally by addressee or by machine confirmation of transmission, if by facsimile transmission; (iii) five business days after having been deposited in the mail, postage prepaid, if mailed by first class air mail; and (iv) on the first business day with respect to which a reputable air courier guarantees delivery; PROVIDED, HOWEVER, that notices of a change of address shall be effective only upon receipt.
12. AMENDMENT. This agreement may not be amended or modified, except upon the written consent of each party hereto approving any such amendment or modification.
13. SUCCESSORS AND ASSIGNS. This letter agreement shall be binding upon XStream and Global Beverage and their successors and assigns.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
If this letter agreement correctly sets forth our understanding, please so acknowledge by signing below and returning a signed copy of the letter agreement to Global Beverage.
GLOBAL BEVERAGE SOLUTIONS, INC.
By: /S/ JERRY PEARRING
--------------------------------------------
Name: Jerry Pearring
Title: Chief Executive Officer and President
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Acknowledged and Agreed to as of the date first written above:
XSTREAM BEVERAGE NETWORK, INC.
By: /S/ RONALD RATNER
--------------------------------------------
Name: Ronald Ratner
Title: Chief Executive Officer and President
|
THIS CONVERTIBLE PROMISSORY NOTE AND THE SECURITIES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS CONVERTIBLE PROMISSORY NOTE NOR THE SECURITIES ISSUABLE HEREUNDER MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED, HYPOTHECATED OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO A TRANSACTION THAT IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
$700,000 January 23, 2008 Plantation, Florida
GLOBAL BEVERAGE SOLUTIONS, INC.
CONVERTIBLE
PROMISSORY NOTE
FOR VALUE RECEIVED, Global Beverage Solutions, Inc., a Nevada corporation ("BORROWER"), located at 2 S. University Drive, Suite 220, Plantation, Florida 33324, hereby unconditionally promises to pay to the order of XStream Beverage Network, Inc. ("LENDER"), and its successors, endorsees, transferees and assigns (together with Lender, "HOLDER"), the principal sum of Seven Hundred Thousand Dollars ($700,000). The principal amount of this Convertible Note shall be due and payable in full, together with accrued interest thereon on October 31, 2008 (the "MATURITY DATE") in the manner provided for in SECTION 2 below, unless this Convertible Note shall have been previously converted as provided in SECTION 4 below. Interest on the outstanding principal amount of this Convertible Note shall accrue at a variable annual interest rate equal, on any day, to the Prime Rate (as defined below) PLUS two percent (2.00%), calculated on the basis of a year of three hundred sixty (360) days. The term "PRIME RATE" shall mean a variable rate of interest per annum equal, on any day, to the rate of interest published on such day in the Eastern Edition of THE WALL STREET JOURNAL as the average prime lending rate for seventy-five percent (75%) of the United States' 30 largest commercial banks, or if the Eastern Edition of THE WALL STREET JOURNAL or such rate is not published on such day, such rate as last published in the Eastern Edition of THE WALL STREET JOURNAL. Accrued interest shall be capitalized and added to the outstanding principal amount of this Convertible Note.
1. PURCHASE AGREEMENT. This Convertible Note has been executed and delivered by Borrower pursuant to that certain letter agreement, dated as of January 23, 2008, between Borrower and Lender (the "PURCHASE AGREEMENT"). Borrower herein agrees with Holder that Borrower will perform and discharge each of its covenants and agreements contained in the Purchase Agreement as from time
to time amended and supplemented, the provisions of which Purchase Agreement are hereby incorporated in this Convertible Note by reference with the same effect as if it were set forth in full. The Purchase Agreement is subject to amendment in the manner provided therein, and any such amendment shall be binding upon the Holder and any subsequent holders of this Convertible Note. All capitalized terms used herein and not defined herein shall have the meanings given such terms in the Purchase Agreement.
2. PAYMENT.
(a) All payments of principal and all other amounts payable in respect of this Convertible Note shall be made by wire transfer in lawful money of the United States of America in immediately available Federal funds, to an account furnished to Borrower in writing for that purpose at least two (2) business days prior to the Maturity Date. Holder shall, before disposing of this Convertible Note or any part hereof, make a notation hereon of all principal payments previously made hereunder; PROVIDED, HOWEVER, that the failure to correctly make a notation of any payment made on this Convertible Note shall not limit or otherwise affect the obligation of Borrower under this Convertible Note with respect to any loan evidenced hereby or payments of principal on this Convertible Note.
(b) In the event that Borrower receives proceeds from the sale of shares of its Common Stock or the issuance of convertible debt at a time when the Convertible Note has not been repaid in full, then Borrower shall use 35% of the net proceeds received in connection with such sale or issuance (a "35% Payment") to repay the outstanding principal amount of the Convertible Note and/or that certain $2,000,000 Secured Promissory Note by Borrower for the benefit of Lender, dated as of January 31, 2007 and amended on February 23, 2007 and again on January 23, 2008 (the "Secured Note"). Any 35% Payment shall first be used to pay down in full the Secured Note, and after the Secured Note has been paid in full, any 35% Payment thereafter (or remaining portion thereof) shall be used to pay down the Convertible Note. Borrower shall not have to pay any portion of a 35% Payment beyond any such amount that pays down in full both the Secured Note and the Convertible Note. Furthermore, any 35% Payment paid on or before May 1, 2008 shall be deemed to satisfy all or a portion, as the case may be, of the $500,000 Payment (as defined in SECTION 7(a)(ii) below) to the extent of the dollar amount of such 35% Payment.
3. PREPAYMENT. Borrower may prepay this Convertible Note, in whole or in part prior to the Maturity Date. Any partial prepayment shall not affect the obligation to continue to pay in full the amount of the payments hereunder until the entire unpaid principal balance hereof is paid.
4. CONVERSION RIGHTS. The Holder, and any subsequent holder of this Convertible Note, is entitled to the rights and benefits, and is subject to the obligations, conditions and restrictions, set forth in the Purchase Agreement, including without limitation the right to convert this Convertible Note into certain securities of Borrower in the manner provided in the Purchase Agreement.
5. TRANSFERS.
(a) By acceptance hereof, the Holder acknowledges that this Convertible Note and the capital stock of Borrower that may be issued upon its conversion have not been registered under the Securities Act, and Holder agrees not to sell, pledge, distribute, offer for sale, transfer or otherwise dispose of this Convertible Note or any capital stock issued upon its conversion in the absence of (i) an effective registration statement under the Securities Act as to this Convertible Note or such securities and registration or qualification of this Convertible Note or such securities under any applicable Blue Sky or state securities laws then in effect, or (ii) an opinion of counsel, reasonably satisfactory to Borrower, that such registration and qualification are not required. Each certificate or other instrument for capital stock issued upon the conversion of this Convertible Note shall bear a legend in the form set forth in the Purchase Agreement.
(b) Subject to the provisions of SECTION 5(a) hereof, this Convertible Note and all rights hereunder are transferable, in whole or in part, upon surrender of the Convertible Note with a properly executed assignment, in the form prescribed by Borrower, at the principal office of Borrower; PROVIDED, HOWEVER, that, except for transfers by Holder of all or any portion of this Convertible Note to any parent, subsidiary or affiliate of Holder or to any officer, director, partner or member of any such parent, subsidiary or affiliate, this Convertible Note may not be transferred in whole or in part without the prior written consent of Borrower.
(c) Until any transfer of this Convertible Note is made in the Convertible Note register, Borrower may treat the registered Holder as the absolute owner hereof for all purposes; PROVIDED, HOWEVER, that if and when this Convertible Note is properly assigned in blank, Borrower may (but shall not be required to) treat the bearer hereof as the absolute owner hereof for all purposes, notwithstanding any notice to the contrary.
(d) Borrower will maintain a register containing the names and addresses of the registered Holders of this Convertible Note. Any registered Holder may change such registered Holder's address as shown on the Convertible Note register by written notice to Borrower requesting such change.
(e) In the reasonable discretion of Borrower, Borrower may condition
any transfer of all or any portion of this Convertible Note (other than a
disposition satisfying the conditions set forth in clause (i) of SECTION 5(a)
above) upon the transferee's delivery to Borrower of a written agreement, in
form and substance reasonably satisfactory to Borrower, whereby the transferee
(i) makes such representations and warranties to and for the benefit of Borrower
as are comparable to the representations and warranties of the purchaser of the
Convertible Note as set forth in the Purchase Agreement, as and to the extent
applicable to the proposed disposition, and (ii) agrees to be bound by the
transfer restrictions set forth in this SECTION 5.
6. TRANSFER BY BORROWER. Borrower may not assign, and no person may assume, any of the obligations of Borrower under this Convertible Note without the prior written consent of Holder, which consent may be granted or withheld in Holder's sole discretion, and any attempt to do so without such consent shall be void.
7. EVENTS OF DEFAULT; REMEDIES.
(a) EVENTS OF DEFAULT. The occurrence of any of the following shall constitute an Event of Default hereunder:
(i) Default in the payment when due of the principal of the indebtedness evidenced by the Convertible Note or any interest due thereon in accordance with the terms of the Convertible Note; and
(ii) Failure of Borrower to make a payment, pursuant to that certain letter agreement, dated even date herewith, by and between Borrower and Laurus Master Fund, Ltd., to Laurus Master Fund, Ltd. in the amount of $500,000 on or before May 1, 2008 (the "$500,000 Payment"); PROVIDED that any 35% Payment (as defined above) made by Borrower on or before May 1, 2008 shall be applied to and shall reduce the amount of such $500,000 Payment as set forth in SECTION 2(b) above.
(b) ACCELERATION OF MATURITY; REMEDIES. Upon the occurrence of any Event of Default described above, Holder at any time thereafter may at its option accelerate the maturity of the indebtedness evidenced by this Convertible Note without notice of any kind. Upon the occurrence of any such Event of Default and the acceleration of the maturity of the indebtedness evidenced by the Convertible Note:
(i) Holder shall be immediately entitled to exercise any and all rights and remedies possessed by Holder pursuant to the terms of this Convertible Note and the Purchase Agreement; and
(ii) Holder shall have any and all other rights and remedies that Holder may now or hereafter possess at law, in equity or by statute.
(c) REMEDIES CUMULATIVE; NO WAIVER. No right, power or remedy conferred upon or reserved to Holder by this Convertible Note or the Purchase Agreement is intended to be exclusive of any other right, power or remedy, but each and every such right, power and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy given hereunder, under any provision of the Purchase Agreement or now or hereafter existing at law, in equity or by statute. No delay or omission by Holder to exercise any right, power or remedy accruing upon the occurrence of any Event of Default shall exhaust or impair any such right, power or remedy or shall be construed to be a waiver of any such Event of Default or an acquiescence therein, and every right, power and remedy given by this Convertible Note and the Purchase Agreement to Holder may be exercised from time to time and as often as may be deemed expedient by Holder.
8. NOTICES. Any notice required by the provisions of this Convertible Note to be given to Holder shall be delivered personally, telecopied, or sent by certified mail or overnight via nationally recognized courier service (such as Federal Express), addressed to Holder at the address appearing on the books of Borrower. The date of personal delivery or telecopy or two (2) business days after the date of mailing (or the next business day after delivery to such courier service), as the case may be, shall be the date of such notice.
9. GOVERNING LAW. THIS CONVERTIBLE NOTE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND SHALL BE GOVERNED BY, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES THEREOF.
10. WAIVERS. Borrower waives presentment for payment, demand, notice of demand, notice of nonpayment or dishonor, protest and notice of protest of this Convertible Note, and all other notices in connection with the delivery, acceptance, performance, default or enforcement of the payment of this Convertible Note, and Borrower agrees that its liability shall be unconditional, without regard to the liability of any other party, and shall not be affected in any manner by any indulgence, extension of time, renewal, waiver or modification granted or consented to by Holder.
11. ATTORNEYS FEES. Borrower promises to pay all reasonable costs and expenses, including attorneys' fees, incurred in the collection and enforcement of this Convertible Note, including, without limitation, enforcement before any court and including all appellate proceedings.
12. SEVERABILITY. Wherever possible each provision of this Convertible Note shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Convertible Note shall be prohibited by or invalid under such law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Convertible Note and shall be interpreted so as to be effective and valid.
IN WITNESS WHEREOF, Borrower has executed and delivered this Convertible Note as of the day and year and at the place first written above.
GLOBAL BEVERAGE SOLUTIONS, INC.,
a Nevada corporation
Exhibit 10.2
THIS CONVERTIBLE PROMISSORY NOTE AND THE SECURITIES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS CONVERTIBLE PROMISSORY NOTE NOR THE SECURITIES ISSUABLE HEREUNDER MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED, HYPOTHECATED OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO A TRANSACTION THAT IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
$700,000 January 23, 2008 Plantation, Florida
GLOBAL BEVERAGE SOLUTIONS, INC.
CONVERTIBLE
PROMISSORY NOTE
FOR VALUE RECEIVED, Global Beverage Solutions, Inc., a Nevada corporation ("BORROWER"), located at 2 S. University Drive, Suite 220, Plantation, Florida 33324, hereby unconditionally promises to pay to the order of XStream Beverage Network, Inc. ("LENDER"), and its successors, endorsees, transferees and assigns (together with Lender, "HOLDER"), the principal sum of Seven Hundred Thousand Dollars ($700,000). The principal amount of this Convertible Note shall be due and payable in full, together with accrued interest thereon on October 31, 2008 (the "MATURITY DATE") in the manner provided for in SECTION 2 below, unless this Convertible Note shall have been previously converted as provided in SECTION 4 below. Interest on the outstanding principal amount of this Convertible Note shall accrue at a variable annual interest rate equal, on any day, to the Prime Rate (as defined below) PLUS two percent (2.00%), calculated on the basis of a year of three hundred sixty (360) days. The term "PRIME RATE" shall mean a variable rate of interest per annum equal, on any day, to the rate of interest published on such day in the Eastern Edition of THE WALL STREET JOURNAL as the average prime lending rate for seventy-five percent (75%) of the United States' 30 largest commercial banks, or if the Eastern Edition of THE WALL STREET JOURNAL or such rate is not published on such day, such rate as last published in the Eastern Edition of THE WALL STREET JOURNAL. Accrued interest shall be capitalized and added to the outstanding principal amount of this Convertible Note.
1. PURCHASE AGREEMENT. This Convertible Note has been executed and delivered by Borrower pursuant to that certain letter agreement, dated as of January 23, 2008, between Borrower and Lender (the "PURCHASE AGREEMENT"). Borrower herein agrees with Holder that Borrower will perform and discharge each of its covenants and agreements contained in the Purchase Agreement as from time
to time amended and supplemented, the provisions of which Purchase Agreement are hereby incorporated in this Convertible Note by reference with the same effect as if it were set forth in full. The Purchase Agreement is subject to amendment in the manner provided therein, and any such amendment shall be binding upon the Holder and any subsequent holders of this Convertible Note. All capitalized terms used herein and not defined herein shall have the meanings given such terms in the Purchase Agreement.
2. PAYMENT.
(a) All payments of principal and all other amounts payable in respect of this Convertible Note shall be made by wire transfer in lawful money of the United States of America in immediately available Federal funds, to an account furnished to Borrower in writing for that purpose at least two (2) business days prior to the Maturity Date. Holder shall, before disposing of this Convertible Note or any part hereof, make a notation hereon of all principal payments previously made hereunder; PROVIDED, HOWEVER, that the failure to correctly make a notation of any payment made on this Convertible Note shall not limit or otherwise affect the obligation of Borrower under this Convertible Note with respect to any loan evidenced hereby or payments of principal on this Convertible Note.
(b) In the event that Borrower receives proceeds from the sale of shares of its Common Stock or the issuance of convertible debt at a time when the Convertible Note has not been repaid in full, then Borrower shall use 35% of the net proceeds received in connection with such sale or issuance (a "35% Payment") to repay the outstanding principal amount of the Convertible Note and/or that certain $2,000,000 Secured Promissory Note by Borrower for the benefit of Lender, dated as of January 31, 2007 and amended on February 23, 2007 and again on January 23, 2008 (the "Secured Note"). Any 35% Payment shall first be used to pay down in full the Secured Note, and after the Secured Note has been paid in full, any 35% Payment thereafter (or remaining portion thereof) shall be used to pay down the Convertible Note. Borrower shall not have to pay any portion of a 35% Payment beyond any such amount that pays down in full both the Secured Note and the Convertible Note. Furthermore, any 35% Payment paid on or before May 1, 2008 shall be deemed to satisfy all or a portion, as the case may be, of the $500,000 Payment (as defined in SECTION 7(a)(ii) below) to the extent of the dollar amount of such 35% Payment.
3. PREPAYMENT. Borrower may prepay this Convertible Note, in whole or in part prior to the Maturity Date. Any partial prepayment shall not affect the obligation to continue to pay in full the amount of the payments hereunder until the entire unpaid principal balance hereof is paid.
4. CONVERSION RIGHTS. The Holder, and any subsequent holder of this Convertible Note, is entitled to the rights and benefits, and is subject to the obligations, conditions and restrictions, set forth in the Purchase Agreement, including without limitation the right to convert this Convertible Note into certain securities of Borrower in the manner provided in the Purchase Agreement.
5. TRANSFERS.
(a) By acceptance hereof, the Holder acknowledges that this Convertible Note and the capital stock of Borrower that may be issued upon its conversion have not been registered under the Securities Act, and Holder agrees not to sell, pledge, distribute, offer for sale, transfer or otherwise dispose of this Convertible Note or any capital stock issued upon its conversion in the absence of (i) an effective registration statement under the Securities Act as to this Convertible Note or such securities and registration or qualification of this Convertible Note or such securities under any applicable Blue Sky or state securities laws then in effect, or (ii) an opinion of counsel, reasonably satisfactory to Borrower, that such registration and qualification are not required. Each certificate or other instrument for capital stock issued upon the conversion of this Convertible Note shall bear a legend in the form set forth in the Purchase Agreement.
(b) Subject to the provisions of SECTION 5(a) hereof, this Convertible Note and all rights hereunder are transferable, in whole or in part, upon surrender of the Convertible Note with a properly executed assignment, in the form prescribed by Borrower, at the principal office of Borrower; PROVIDED, HOWEVER, that, except for transfers by Holder of all or any portion of this Convertible Note to any parent, subsidiary or affiliate of Holder or to any officer, director, partner or member of any such parent, subsidiary or affiliate, this Convertible Note may not be transferred in whole or in part without the prior written consent of Borrower.
(c) Until any transfer of this Convertible Note is made in the Convertible Note register, Borrower may treat the registered Holder as the absolute owner hereof for all purposes; PROVIDED, HOWEVER, that if and when this Convertible Note is properly assigned in blank, Borrower may (but shall not be required to) treat the bearer hereof as the absolute owner hereof for all purposes, notwithstanding any notice to the contrary.
(d) Borrower will maintain a register containing the names and addresses of the registered Holders of this Convertible Note. Any registered Holder may change such registered Holder's address as shown on the Convertible Note register by written notice to Borrower requesting such change.
(e) In the reasonable discretion of Borrower, Borrower may condition
any transfer of all or any portion of this Convertible Note (other than a
disposition satisfying the conditions set forth in clause (i) of SECTION 5(a)
above) upon the transferee's delivery to Borrower of a written agreement, in
form and substance reasonably satisfactory to Borrower, whereby the transferee
(i) makes such representations and warranties to and for the benefit of Borrower
as are comparable to the representations and warranties of the purchaser of the
Convertible Note as set forth in the Purchase Agreement, as and to the extent
applicable to the proposed disposition, and (ii) agrees to be bound by the
transfer restrictions set forth in this SECTION 5.
6. TRANSFER BY BORROWER. Borrower may not assign, and no person may assume, any of the obligations of Borrower under this Convertible Note without the prior written consent of Holder, which consent may be granted or withheld in Holder's sole discretion, and any attempt to do so without such consent shall be void.
7. EVENTS OF DEFAULT; REMEDIES.
(a) EVENTS OF DEFAULT. The occurrence of any of the following shall constitute an Event of Default hereunder:
(i) Default in the payment when due of the principal of the indebtedness evidenced by the Convertible Note or any interest due thereon in accordance with the terms of the Convertible Note; or
(ii) Failure of Borrower to make a payment, pursuant to that certain letter agreement, dated even date herewith, by and between Borrower and Laurus Master Fund, Ltd., to Laurus Master Fund, Ltd. in the amount of $500,000 on or before May 1, 2008 (the "$500,000 Payment"); PROVIDED that any 35% Payment (as defined above) made by Borrower on or before May 1, 2008 shall be applied to and shall reduce the amount of such $500,000 Payment as set forth in SECTION 2(b) above.
(b) ACCELERATION OF MATURITY; REMEDIES. Upon the occurrence of any Event of Default described above, Holder at any time thereafter may at its option accelerate the maturity of the indebtedness evidenced by this Convertible Note without notice of any kind. Upon the occurrence of any such Event of Default and the acceleration of the maturity of the indebtedness evidenced by the Convertible Note:
(i) Holder shall be immediately entitled to exercise any and all rights and remedies possessed by Holder pursuant to the terms of this Convertible Note and the Purchase Agreement; and
(ii) Holder shall have any and all other rights and remedies that Holder may now or hereafter possess at law, in equity or by statute.
(c) REMEDIES CUMULATIVE; NO WAIVER. No right, power or remedy conferred upon or reserved to Holder by this Convertible Note or the Purchase Agreement is intended to be exclusive of any other right, power or remedy, but each and every such right, power and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy given hereunder, under any provision of the Purchase Agreement or now or hereafter existing at law, in equity or by statute. No delay or omission by Holder to exercise any right, power or remedy accruing upon the occurrence of any Event of Default shall exhaust or impair any such right, power or remedy or shall be construed to be a waiver of any such Event of Default or an acquiescence therein, and every right, power and remedy given by this Convertible Note and the Purchase Agreement to Holder may be exercised from time to time and as often as may be deemed expedient by Holder.
8. NOTICES. Any notice required by the provisions of this Convertible Note to be given to Holder shall be delivered personally, telecopied, or sent by certified mail or overnight via nationally recognized courier service (such as Federal Express), addressed to Holder at the address appearing on the books of Borrower. The date of personal delivery or telecopy or two (2) business days after the date of mailing (or the next business day after delivery to such courier service), as the case may be, shall be the date of such notice.
9. GOVERNING LAW. THIS CONVERTIBLE NOTE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND SHALL BE GOVERNED BY, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES THEREOF.
10. WAIVERS. Borrower waives presentment for payment, demand, notice of demand, notice of nonpayment or dishonor, protest and notice of protest of this Convertible Note, and all other notices in connection with the delivery, acceptance, performance, default or enforcement of the payment of this Convertible Note, and Borrower agrees that its liability shall be unconditional, without regard to the liability of any other party, and shall not be affected in any manner by any indulgence, extension of time, renewal, waiver or modification granted or consented to by Holder.
11. ATTORNEYS FEES. Borrower promises to pay all reasonable costs and expenses, including attorneys' fees, incurred in the collection and enforcement of this Convertible Note, including, without limitation, enforcement before any court and including all appellate proceedings.
12. SEVERABILITY. Wherever possible each provision of this Convertible Note shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Convertible Note shall be prohibited by or invalid under such law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Convertible Note and shall be interpreted so as to be effective and valid.
IN WITNESS WHEREOF, Borrower has executed and delivered this Convertible Note as of the day and year and at the place first written above.
GLOBAL BEVERAGE SOLUTIONS, INC.,
a Nevada corporation
By: /s/ Jerry Pearring
----------------------------
Name: Jerry Pearring
Title: Chief Executive Officer
|
Exhibit 10.3
SECURED PROMISSORY NOTE
TULSA, OKLAHOMA
$2,000,000 Date: January 31, 2007
FOR VALUE RECEIVED, the undersigned ("Maker") promises to pay to the order of XStream Beverage Network, Inc. ("Payee"), at its principal office located 2 South University Drive, Suite 220, Plantation, Florida 33324, or at any other address as Payee may designate by written notice to Maker, the principal sum of TWO MILLION DOLLARS ($2,000,000), together with interest as set forth below.
The unpaid principal amount hereof ("Principal Amount") and all accrued interest shall be payable in full on January 31, 2011 (the "Maturity Date"). The Principal Amount shall bear interest hereunder at Six Percent (6%) per annum (the "Interest Rate"), computed on the basis of the actual number of days elapsed and a year of 365 days, compounded annually. From and after any Event of Default (as defined below), the rate of interest chargeable hereunder will be the Interest Rate plus four percent (4%); provided that in any event, the rate of interest chargeable hereunder will not exceed the maximum rate allowable by applicable law, and in the event that any interest charged hereunder exceeds the rate permitted by applicable law, then any such excess will first be applied to any outstanding Principal Amount owed hereunder and any remaining excess will be returned to Maker.
The Note shall be paid by wire transfer to the account designated by Payee, in readily available funds, as follows: (i) $800,000 shall be due and payable on the Closing Date of that certain Agreement and Plan of Merger between Payee, Maker, Global Merger Corp. and Beverage Network of Maryland, Inc., dated January 31, 2007 (the "Merger Agreement"), as such term is defined in the Merger Agreement; and (ii) $25,000 shall be due and payable on the first day of each month, beginning on March 1, 2007, for a period of 48 months; provided, however, in the event Maker raises any equity capital while the Note is still outstanding, Maker will pay down the Note in an amount equal to 35% of the net proceeds received by Maker in the equity raise. Maker may prepay this Note in whole or in part at any time, with accrued interest to the date of prepayment.
This Note, and the obligations evidenced hereby, shall be secured by
(i) that certain Master Security Agreement between Maker, Payee, Global Merger
Corp., a Nevada corporation ("Acquisition Sub"), and Beverage Network of
Maryland, Inc., a Florida corporation ("Beverage Network"), dated as even date
hereof (the "Security Agreement") and (ii) Maker's pledge to Payee of the
capital shares of Acquisition Sub and Beverage Network pursuant to the Stock
Pledge Agreement between Maker and Payee, dated as of even date hereof (the
"Pledge Agreement").
Maker represents to Payee that (i) all of the representations and warranties of Maker set forth in the Merger Agreement are true and correct, (ii) Maker is not in breach of any of its covenants to Payee set forth in the Merger Agreement and (iii) no Event of Default (as defined below) has occurred.
Unless Payee otherwise determines, all payments on this Note shall be applied to the payment of accrued interest before being applied to the payment of principal. Any payment which is required to be made on a day which is not a Business Day (as defined below) shall be payable on the next succeeding Business Day and such additional time shall be included in the computation of interest. In the event that any other obligations of Maker (or any affiliate of Maker) to Payee (or any affiliate of Payee) are due at any time that Payee receives a payment from Maker on account of this Note or any such other obligations of Maker (or any affiliate of Maker), Payee may apply such payment to amounts due under this Note to any such other obligations in such manner as Payee, in its sole discretion, elects, regardless of any instructions from Maker to the contrary. As used herein, "Business Day" shall mean a day on which banks in the United States shall be open for ordinary business.
Upon the occurrence of any of the following (each, an "Event of Default") with respect to Maker: (i) default by Maker in payment of any amount due under this Note; (ii) default by Maker, Acquisition Sub or Beverage Network in any of their respective obligations, representations, warranties and covenants under the Security Agreement; (iii) Maker shall commence any case, proceeding or other action under any law relating to bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it as bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other relief with respect to Maker or any of its debts, or seeking appointment of a receiver, trustee, custodian or other similar official for Maker or for all or any substantial part of its assets, or it shall make a general assignment for the benefit of its creditors, or there shall be commenced against Maker any case, proceeding or other action of a nature referred to in this clause (iii), or there shall be commenced against Maker any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of its assets which results in the entry of an order for any such relief, or Maker shall take any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in this clause (iii), or Maker shall generally not, or shall be unable to, or shall admit in writing its inability to, pay its debts as they become due; (iv) entry of a judgment in excess of $25,000 against it; (v) failure to pay or remit any tax when assessed or due unless contested in good faith; (vi) dissolution of Maker; (vii) Maker making a bulk transfer or sending notice of intent to do so; (viii) suspension or liquidation of the usual business of Maker; or (ix) the occurrence of a default or event of default under the Merger Agreement; then, in the case of any such Event of Default other than those referred to in clause (iii) of this sentence, Payee may declare by notice to Maker this Note to be immediately due and payable.
The rights and remedies of Payee provided under this Note are cumulative with the rights and remedies available to Payee under any other instruments or agreements or under applicable law.
In the case of the occurrence of an Event of Default, Maker shall be liable for all costs of enforcement and collection of this Note incurred by Payee or any other holder of this Note, including but not limited to reasonable attorneys' fees, disbursements and court costs. In addition, in the event of a default hereunder, Maker shall pay all reasonable attorneys' fees and disbursements incurred by Payee in obtaining advice as to its rights and remedies in connection with such default. In the event Maker defaults in the payment of this Note when due, Payee may apply to any court of competent jurisdiction for a judgment directing Maker to pay its obligations hereunder, and Payee is hereby authorized to act as Maker's attorney-in-fact before such court for the purpose of confessing such judgment against Maker.
Maker hereby separately waives presentment, notice of dishonor, protest and notice of protest, and any or all other notices or demands (other than demand for payment) in connection with the delivery, acceptance, performance, default or endorsement of this Note. The liability of Maker hereunder shall be unconditional and shall not be in any manner affected by any indulgence whatsoever granted or consented to by the holder hereof, including, but not limited to any extensions of time, renewal, waiver or other modification. Any failure of the holder to exercise any right hereunder shall not be construed as a waiver of the right to exercise the same or any other right at any time and from time to time thereafter. Payee or any holder may accept late payments, or partial payments, even though marked "payment in full" or containing words of similar import or other conditions, without waiving any of its rights. No amendment, modification or waiver of any provision of this Note nor consent to any departure by Maker therefrom shall be effective, irrespective of any course of dealing, unless the same shall be in writing and signed by Payee, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. This Note cannot be changed or terminated orally or by estoppel or waiver or by any alleged oral modification regardless of any claimed partial performance referable thereto.
Except to the extent otherwise provided herein with respect to service of process, any notice from Payee to Maker shall be deemed given when delivered to Maker by hand or when deposited in the United States mail and addressed to Maker at its address set forth below or to any other address as may appear in Payee's records as the address of Maker.
This Note shall be governed by and construed in accordance with the laws of the State of Florida without giving effect to the principles of conflicts of law. If any provision of this Note is held to be illegal or unenforceable for any reason whatsoever, such illegality or unenforceability shall not affect the validity of any other provision hereof.
MAKER AND EACH INDORSER AGREES THAT ANY ACTION, SUIT OR PROCEEDING IN RESPECT OF OR ARISING OUT OF THIS NOTE MAY EXCLUSIVELY BE INITIATED AND PROSECUTED IN ANY FEDERAL OR STATE COURT LOCATED IN BROWARD COUNTY, STATE OF FLORIDA. MAKER CONSENTS AND SUBMITS TO THE EXERCISE OF EXCLUSIVE JURISDICTION OVER IT BY ANY COURT HAVING JURISDICTION OVER THE SUBJECT MATTER. MAKER AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
This Note, the Merger Agreement and the Security Agreement to which Maker is a party embody the entire agreement between Maker and Payee relating to the subject matter thereof and supersede all prior agreements, representations and understandings, if any, relating to the subject matter thereof.
Payee is authorized to fill in any blank spaces and to otherwise complete this Note and correct any patent errors herein.
[SIGNATURE TO FOLLOW]
IN WITNESS WHEREOF, the undersigned executes this Note intending to be legally bound hereby.
GLOBAL BEVERAGE SOLUTIONS, INC.
By: /s/ Bruce M. Knight -------------------------------- Name: Bruce M Knight Title: Vice-President |
Exhibit 10.4
AMENDMENT NO. 1
TO THE
$2,000,000 SECURED PROMISSORY NOTE
This AMENDMENT NO. 1 ("AMENDMENT"), dated February 23, 2007, is entered into by and between XStream Beverage Network, Inc., a Nevada corporation and Global Beverage Solutions, Inc., a Nevada corporation, for the purpose of amending the terms of that certain $2,000,000 Secured Promissory Note, dated January 31, 2007 (the "NOTE").
WHEREAS, the parties have heretofore agreed to amend the repayment terms of the Note;
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto amend the Note and agree as follows:
1. All capitalized terms not defined herein shall have the same meaning ascribed to them in the Note.
2. The first sentence of the second paragraph of the Note is hereby replaced in its entirety as follows:
"The unpaid principal amount hereof ("Principal Amount") and all accrued interest shall be payable in full on March 31, 2011 (the "Maturity Date")."
2. The third paragraph of the Note is hereby replaced in its entirety as follows:
"The Note shall be paid by wire transfer to the account designated by Payee, in readily available funds, as follows: (i) $229,000 shall be due and payable on the Closing Date of that certain Agreement and Plan of Merger between Payee, Maker, Global Merger Corp. and Beverage Network of Maryland, Inc., dated January 31, 2007 (the "Merger Agreement"), as such term is defined in the Merger Agreement; (ii) 40% of any cash proceeds received by Parent from the February 5, 2007 I-E Offering; and (C) the remainder of the balance to be paid to the Shareholder in minimum installments of $25,000 per month commencing on September 1st 2007. In the event Parent raises any equity capital while the Note is still outstanding, Parent shall pay down the Note in an amount equal to 35% of the net proceeds received in such equity raise. Maker may prepay this Note in whole or in part at any time, with accrued interest to the date of prepayment."
3. Except as specifically set forth in this Amendment, there are no other amendments to the Note and the Note shall remain unmodified and in full force and effect.
4. This Note shall be governed by and construed in accordance with the laws of the State of Florida without giving effect to the principles of conflicts of law. This Amendment may be executed in one or more counterparts, any one of which may be by facsimile, and all of which taken together shall constitute one and the same instrument.
[SIGNATURES TO FOLLOW]
Amendment No. 1 Secured Promissory Note Execution Page
IN WITNESS WHEREOF, the undersigned executes this Note intending to be legally bound hereby.
GLOBAL BEVERAGE SOLUTIONS, INC.
By: /s/ Bruce M. Knight ---------------------------- Name: Bruce M. Knight Title: Vice-President |
AGREED AND ACCEPTED:
XSTREAM BEVERAGE NETWORK, INC.
By: /s/ Ted Farnsworth ---------------------------- Name: Ted Farnsworth Title: Chairman and CEO |
Exhibit 10.5
AMENDMENT NO. 2
TO THE
$2,000,000 SECURED PROMISSORY NOTE
This AMENDMENT NO. 2 ("Amendment No. 2"), dated January 23, 2008, is entered into by and between XStream Beverage Network, Inc., a Nevada corporation and Global Beverage Solutions, Inc., a Nevada corporation (collectively the "Parties"), for the purpose of amending the terms of that certain $2,000,000 Secured Promissory Note between the Parties, dated January 31, 2007 and amended by Amendment No. 1 on February 23, 2007 ("Amendment No. 1" and together with the $2,000,000 Secured Promissory Note, the "Note").
WHEREAS, the Parties have heretofore agreed to amend the repayment terms of the Note.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties hereto amend the Note and agree as follows:
1. All capitalized terms not defined herein shall have the same meaning ascribed to them in the Note.
2. The first sentence of the second paragraph of the Note is hereby replaced in its entirety as follows:
"The unpaid principal amount hereof ("Principal Amount") and all accrued interest shall be payable in full on October 31, 2008 (the "Maturity Date")."
3. The third paragraph of the Note is hereby replaced in its entirety as follows:
"In the event Maker receives proceeds from the sale of shares of its common stock or the issuance of convertible debt at a time when this Note is still outstanding, Maker shall use 35% of the net proceeds received in connection with such sale or issuance (a "35% Payment") to pay down this Note and/or to repay the principal outstanding amount of that certain convertible note by Maker for the benefit of Payee, dated as of January 23, 2008 and made in connection with the repurchase by Maker from Payee of sixty million five hundred thousand (60,500,000) shares of Maker's common stock (the "Convertible Note"). Any 35% Payment shall first be used to pay down in full the Note, and after the Note has been paid in full, any 35% Payment thereafter (or remaining portion thereof) shall be used to pay down the Convertible Note. Maker shall not have to
pay any portion of a 35% Payment beyond any such amount that pays down in full both the Note and the Convertible Note. Furthermore, any 35% Payment paid on or before May 1, 2008 shall be deemed to satisfy all or a portion, as the case may be, of the Payment Amount, as defined in that certain letter agreement by and among Maker, Payee and Laurus Master Fund, Ltd. dated as of January 23, 2008, to the extent of the dollar amount of such 35% Payment."
4. Payee hereby waives any default, claim of default, or penalty resulting or arising from any failure to the date hereof of Maker to make payments of any of the minimum installments of $25,000 per month commencing on September 1, 2007 (the "Installment Payments") as required by Amendment No. 1, and in accordance with PARAGRAPH 3 of this Amendment No. 2, the Note is hereby amended to remove the Installment Payments provision.
5. Except as specifically set forth in this Amendment, there are no other amendments to the Note and the Note shall remain unmodified and in full force and effect.
6. This Note shall be governed by and construed in accordance with the laws of the State of Florida without giving effect to the principles of conflicts of law. This Amendment No. 2 may be executed in one or more counterparts, any one of which may be by facsimile, and all of which taken together shall constitute one and the same instrument.
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Amendment No. 2 Secured Promissory Note Execution Page
IN WITNESS WHEREOF, the undersigned executes this Note intending to be legally bound hereby.
GLOBAL BEVERAGE SOLUTIONS, INC.
By: /S/ Jerry Pearring
----------------------------
Name: Jerry Pearring
Title: Chief Executive Officer
and President
|
AGREED AND ACCEPTED:
XSTREAM BEVERAGE NETWORK, INC.
By: /s/ Ronald Ratner
----------------------------
Name: Ronald Ratner
Title: Chief Executive Officer
and President
|
Exhibit 10.6
LAURUS MASTER FUND, LTD.
c/o Laurus Capital Management, Inc.
335 Madison Ave., 10th Floor
New York, NY 10017
January 23, 2008
Jerry Pearring
President and Chief Executive Officer
Global Beverage Solutions, Inc.
2 S. University Drive, Suite 220
Plantation, Florida 33324
Mr. Ronald Ratner
Chief Executive Officer and President
XStream Beverage Network, Inc.
18851 N.E. 29th Avenue, Suite 700
Aventura, Florida 33180
Dear Messrs. Pearring and Ratner:
Laurus Master Fund, Ltd. ("Laurus") is pleased to confirm its agreement with Global Beverage Solutions, Inc. ("Global Beverage") regarding the terms and conditions under which Laurus will release all of the liens it has on the inventory and receivables of Beverage Network of Maryland, Inc., an entity that is wholly owned by Global Beverage.
Furthermore, upon the payment and release described herein, the principal amount of that certain $2,000,000 Secured Promissory Note (which as of the date hereof is $1,086,524.87), dated January 31, 2007 (the "Initial Note"), as amended by that certain Amendment No. 1 to the Initial Note, dated as of February 23, 2007 ("Note Amendment No. 1") and by that certain Amendment No. 2 to the Initial Note, dated as of January 23, 2008 ("Note Amendment No. 2," and together with Note Amendment No. 1 and the Initial Note, the "Note") made by Global Beverage in favor of XStream Beverage Network, Inc. ("XStream") shall be reduced by the Payment Amount (as defined below).
1. PAYMENT AND RELEASE. If, prior to May 1, 2008, Global Beverage remits payment to Laurus in the amount of $500,000 in good, cleared funds (the "Payment Amount"):
(a) Laurus agrees to release promptly thereafter all of the liens (the "Liens") it has on the inventory and receivables of Beverage Network of Maryland, Inc. Upon its receipt of the Payment Amount, Laurus agrees to take any and all actions necessary or appropriate to effect and evidence its release of the Liens, including without limitation, the filing of UCC Termination Statements, as appropriate, all at the sole cost and expense of Global Beverage.
(b) XStream and Laurus agree to terminate promptly thereafter: (i) that certain Master Security Agreement, dated as of January 31, 2007 (the "Master Security Agreement"), by which Global Beverage and the other Assignors (as defined in the Master Security Agreement) granted a security interest in the Collateral (as defined in the Master Security Agreement) to XStream, and (ii) that certain Stock Pledge Agreement, dated as of January 31, 2007 (the "Stock Pledge Agreement"), by which Global Beverage granted to XStream a security interest in all of the stock of Beverage Network of Maryland, Inc. that is owned by Global Beverage. XStream and Laurus further agree to release all security interests, liens, and any other encumbrances (the "Encumbrances") on the stock of Beverage Network of Maryland, Inc. and on all other collateral secured by the Master Security Agreement and the Stock Pledge Agreement and to take all necessary or appropriate actions to effect and evidence the release of the Encumbrances, including without limitation, the filing of UCC Termination Statements, as appropriate. Global Beverage agrees to the termination of the Master Security Agreement and the Stock Pledge Agreement and all other actions set forth in this SECTION 1(b).
2. SOURCE OF FUNDS FOR PAYMENT AMOUNT. If, pursuant to the provisions of Amendment No. 2, that certain letter agreement by and between Global Beverage and XStream dated as of January 23, 2008 by which Global Beverage repurchases 60,500,000 shares of its common stock from XStream (the "Stock Repurchase Agreement"), and that certain Convertible Promissory Note dated the date hereof from Global Beverage in favor of XStream in the original principal amount of $700,000 (the "Stock Repurchase Note"), Global Beverage pays a "35% Payment" (as defined in each of Amendment No. 2, the Stock Repurchase Agreement, and the Stock Repurchase Note) on or before May 1, 2008, such 35% Payment shall be used to satisfy the Payment Amount to the extent of the dollar amount of such 35% Payment, PROVIDED, HOWEVER, that to the extent such 35% Payment does not satisfy the entire amount of the Payment Amount, the remaining balance of the Payment Amount shall remain outstanding and payable.
3. REDUCTION OF PRINCIPAL AMOUNT OF THE NOTE. Upon the receipt of the Payment Amount by Laurus pursuant to the terms of this letter agreement, (i) the principal amount of the Note shall be reduced by the Payment Amount, and (ii) XStream or Laurus will make a notation on the Note reflecting such reduction in the principal amount outstanding under the Note; PROVIDED, HOWEVER, that the failure to make such notation shall not limit or otherwise affect the obligations of Global Beverage with respect to the payment of such principal.
4. COLLATERAL ASSIGNMENT OF NOTE AND STOCK REPURCHASE NOTE.
(a) Contemporaneously with the execution hereof, XStream shall execute and deliver to Laurus a collateral assignment of the Note and the Stock Repurchase Note (collectively, the "Assigned Notes"), and all collateral security for the Assigned Notes, in the form attached hereto as EXHIBIT A (the "Collateral Assignment of Notes"). The Collateral Assignment of Notes shall be acknowledged and agreed to by Global Beverage on the terms set forth on the acknowledgement therein. Laurus' agreement to release the Liens and Encumbrances and to terminate the Master Security Agreement and Stock Pledge Agreement in accordance with PARAGRAPH 1 above is further conditioned upon its receipt of a fully executed Collateral Assignment of Notes including the aforementioned acknowledgement by Global Beverage and the sole original Note and Stock Repurchase Note.
(b) Except as may result from the assignments set forth in PARAGRAPH 3(A) above, neither XStream nor Laurus will assign, pledge, sell or otherwise transfer the Master Security Agreement or the Stock Pledge Agreement prior to the termination of this letter agreement.
5. ACKNOWLEDGEMENT OF STOCK REPURCHASE. Laurus, as a creditor of XStream, hereby acknowledges and agrees to the sale by XStream to Global Beverage of sixty million five hundred thousand (60,500,000) shares of Global Beverage's common stock pursuant to and in accordance with the terms of the Stock Repurchase Agreement.
6. TERMINATION. This letter agreement will terminate, without liability to any party hereto, on May 1, 2008 if Laurus has not received the Payment Amount in good, cleared funds.
7. REPRESENTATIONS AND WARRANTIES OF LAURUS. Laurus represents and warrants to Global Beverage and XStream that:
(a) Laurus has the full power and authority to enter into, execute and deliver this letter agreement and perform the obligations contained herein;
(b) the execution and delivery by Laurus of this letter agreement and the performance by it of its obligations contemplated in this letter agreement have been duly authorized by all necessary corporate or other action of Laurus; and
(c) the execution, delivery and performance of this letter agreement by Laurus will not conflict with or result in any material breach or violation of any of the terms and conditions of, or constitute (with notice or lapse of time or both) a default under, any instrument, contract or other agreement to which Laurus is a party or by which it is bound.
8. REPRESENTATIONS AND WARRANTIES OF XSTREAM. XStream represents and warrants to Laurus and Global Beverage that:
(a) XStream has the full power and authority to enter into, execute and deliver this letter agreement and perform the obligations contained herein;
(b) the execution and delivery by XStream of this letter agreement and the performance by it of its obligations contemplated in this letter agreement have been duly authorized by all necessary corporate or other action of XStream;
(c) the execution, delivery and performance of this letter agreement by XStream will not conflict with or result in any material breach or violation of any of the terms and conditions of, or constitute (with notice or lapse of time or both) a default under, any instrument, contract or other agreement to which XStream is a party or by which it is bound;
(d) as of the date of this letter agreement, XStream has not entered into any agreement or understanding with any person or entity relating to the sale, hypothecation, pledge, assignment, disposal or transfer of the Note and is the owner of, and has good and marketable title to the Note, free and clear of all liens, pledges and encumbrances of any kind, except for liens granted in favor of Laurus; and
(e) as of the date of this letter agreement, XStream has not assigned, pledged, sold or otherwise transferred the Master Security Agreement or the Stock Pledge Agreement, except for liens granted in favor of Laurus.
9. REPRESENTATIONS AND WARRANTIES OF GLOBAL BEVERAGE. Global Beverage represents and warrants to Laurus and XStream that:
(a) Global Beverage has the full power and authority to enter into, execute and deliver this letter agreement and perform the obligations contained herein;
(b) the execution and delivery by Global Beverage of this letter agreement and the performance by it of its obligations contemplated in this letter agreement have been duly authorized by all necessary corporate or other action of Global Beverage; and
(c) the execution, delivery and performance of this letter agreement by Global Beverage will not conflict with or result in any material breach or violation of any of the terms and conditions of, or constitute (with notice or lapse of time or both) a default under, any instrument, contract or other agreement to which Global Beverage is a party or by which it is bound.
10. MISCELLANEOUS.
(a) No waiver, amendment or other modification of this letter agreement shall be effective unless in writing and signed by each party to be bound thereby. This letter agreement shall inure to the benefit of and be binding on the parties hereto and their respective successors.
(b) In case any provision of this letter agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions of this letter agreement shall not in any way be affected or impaired thereby.
(c) This letter agreement shall be governed by, and construed and interpreted in accordance with, the laws of the State of New York.
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Please confirm that the foregoing is in accordance with your understanding by signing and returning to us the enclosed duplicate of this letter.
LAURUS MASTER FUND, LTD.
By: /S/ PATRICK REGAN
-------------------------------
Name: Patrick Regan
Title: Senior Managing Director
|
Acknowledged and Agreed
to as of the date first
written above:
GLOBAL BEVERAGE SOLUTIONS, INC.
By: /S/ JERRY PEARRING
--------------------------------------------
Name: Jerry Pearring
Title: Chief Executive Officer and President
|
XSTREAM BEVERAGE NETWORK, INC.
By: /S/ RONALD RATNER
--------------------------------------------
Name: Ronald Ratner
Title: Chief Executive Officer and President
|
EXHIBIT A
COLLATERAL ASSIGNMENT OF NOTES made as of this 23rd day of January, 2008 (this "ASSIGNMENT") by XStream Beverage Network, Inc., a Nevada corporation ("ASSIGNOR"), to Laurus Master Fund, Ltd. ("ASSIGNEE").
WHEREAS, Assignor, certain subsidiaries of Assignor and Assignee have entered into a Security and Purchase Agreement dated as of March 31, 2006 (as amended, modified, restated and/or supplemented from time to time, the "SECURITY AGREEMENT"), pursuant to which Assignee has provided certain financial accommodations to the Assignor and certain subsidiaries of the Assignor. All capitalized terms not herein defined shall have the meanings given to them in the Security Agreement.
FOR VALUE RECEIVED, and as collateral security for all debts, liabilities and obligations of Assignor to Assignee, now existing or hereafter arising under any agreement between Assignor and Assignee, including, without limitation, the Security Agreement and the Ancillary Agreements, Assignor hereby assigns, transfers and sets over unto Assignee and its successors and assigns, all of its rights, but not its obligations, under (i) that certain Secured Promissory Note dated as of February 23, 2007 from Global Beverage Solutions, Inc. ("MAKER") in favor of Assignor in the original principal amount of $2,000,000 (as amended, modified, restated and/or supplemented from time to time, the "SECURED NOTE"), and (ii) that certain Convertible Promissory Note dated the date hereof from Maker in favor of Assignor in the original principal amount of $700,000 (as amended, modified, restated and/or supplemented from time to time, the "CONVERTIBLE NOTE," and collectively with the Secured Note, the "NOTES") including, without limitation, all moneys and claims for moneys due and/or to become due to Assignor under the Notes and all collateral security therefor and all rights to convert the indebtedness evidenced thereby into shares of common stock of the Maker as set forth in the Convertible Note and the Purchase Agreement (as defined in the Convertible Note).
Assignor hereby (i) specifically authorizes and directs Maker to make all payments due under or arising under the Notes directly to Assignee and hereby irrevocably authorizes and empowers Assignee (a) to ask, demand, receive, receipt and give acquittance for any and all amounts which may be or become due or payable, or remain unpaid at any time and times to Assignor by Maker under and pursuant to the Notes, (b) to endorse any checks, drafts or other orders for the payment of money payable to Assignor in payment thereof, and (c) in Assignee's discretion to file any claims or take any action or institute any proceeding, either in its own name or in the name of Assignor or otherwise, which Assignee may deem necessary or advisable to effectuate the foregoing. It is expressly understood and agreed, however, that Assignee shall not be required or obligated in any manner to make any demand or to make any inquiry as to the nature or sufficiency of any payment received by it, or to present or file any claim or take any other action to collect or enforce the payment of any amounts which may have been assigned to Assignee or to which Assignee may be entitled hereunder at any time or times.
Maker is hereby authorized to recognize Assignee's claims to rights hereunder without investigating any reason for any action taken by Assignee or the validity or the amount of the obligations or existence of any default, or the application to be made by Assignee of any of the amounts to be paid to Assignee. Checks for all or any part of the sums payable under this Assignment shall be drawn to the sole and exclusive order of Assignee.
Without first obtaining the written consent of Assignee, Assignor and Maker shall not (i) amend or modify the Notes, or (ii) agree to or suffer any amendment, extension, renewal, release, acceptance, forbearance, modification or waiver with respect to any rights arising under the Notes.
Without first obtaining the written consent of Assignee, Assignor shall not exercise any right it has under the Convertible Note to convert the indebtedness evidenced thereby into shares of Common Stock of Maker (the "CONVERSION SHARES"). In the event Assignor converts all or any portion of the outstanding principal amount and/or accrued interest and fees payable under and in accordance with the terms of the Convertible Note into Conversion Shares, Assignor shall use its reasonable best efforts to immediately sell the Conversion Shares, in accordance with the terms and restrictions of Section 5 of the Convertible Note and with all applicable federal and state securities laws, and simultaneously remit to Assignee all of the cash proceeds (net of brokerage fees) received by Assignor therefrom.
The occurrence of any Event of Default or default under any Note shall constitute an Event of Default under the Security Agreement and each Ancillary Agreement.
In the event Assignor declines to exercise any rights under the Notes, Assignee shall have the right to enforce any and all such rights of Assignor against Maker.
This Assignment shall be governed by and construed in accordance with the laws of the State of New York, without resort to the conflict of law principles thereof.
This Assignment may be executed in any number of counterparts and by different signatories hereto on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute one and the same agreement. This Assignment may be executed by facsimile or electronic transmission.
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IN WITNESS WHEREOF, Assignor has duly executed this Assignment the day and year first above written.
XSTREAM BEVERAGE NETWORK, INC.
Title:
Maker hereby acknowledges, consents and agrees to the provisions of this Collateral Assignment and agrees to make all payments under the Notes to Assignee as of this 23rd day of January, 2008.
GLOBAL BEVERAGE SOLUTIONS, INC.
Exhibit 99.1
GLOBAL BEVERAGE SOLUTIONS ENTERS INTO AGREEMENT TO REPURCHASE
60,500,000 SHARES OF ITS COMMON STOCK
REPURCHASE WILL REDUCE OUTSTANDING SHARES BY 40 PERCENT
PLANTATION, FL -- Jan. 29, 2008 - Global Beverage Solutions (OTC BB:GBVS.OB) today announced that it has entered into an agreement to repurchase 60,500,000 shares of its common stock from XStream Beverage Network, Inc. (OTC BB:XBVG.OB). The shares were originally issued to XStream Beverage as part of Global Beverage's acquisition of Beverage Network of Maryland, Inc., a "New Age" beverage distribution company, in February 2007.
In connection with the repurchase transaction, Global Beverage issued a convertible note in the principal amount of $700,000 to XStream Beverage in consideration for the repurchase of the shares. The note bears interest at the prime rate plus 2% and matures on October 31, 2008. If Global Beverage defaults under the note, the holder of the note has the option to convert the outstanding principal and any accrued interest, or any part thereof, under the note into shares of Global Beverage's common stock. A default under the note will be deemed to occur if, among other things, Global Beverage fails to make a $500,000 payment under a related note on or before May 1, 2008.
"We are pleased to have entered into this agreement, which will reduce the number of our shares outstanding by more than 40 percent," said Jerry Pearring, President and Chief Executive Officer of Global Beverage. "We believe the repurchase will allow us to optimize our capital structure in an effort to enhance shareholder value."
ABOUT GLOBAL BEVERAGE SOLUTIONS, INC.
Global Beverage Solutions, Inc. is focused on acquiring majority ownership interests in beverage-related companies, with a particular emphasis on companies operating in the imported bottled water and alternative or "New Age" beverage industries. Global Beverage Solutions, Inc. currently operates two wholly owned beverage-related subsidiaries:
-- Aqua Maestro, Inc. - an importer and seller of bottled water via company-owned distribution centers to retailers and consumers in South Florida, direct sales to retailers outside of South Florida, direct sales to consumers generated through its website at HTTP://WWW.AQUAMAESTRO.COM, and sales to third party distributors.
-- Beverage Network of Maryland, Inc. - a New Age distributor based in Jessup, Maryland., which distributes brands such as Welch's and Fiji water to retailers in Washington, D.C., Northern Virginia, and the entire state of Maryland.
For additional information about Global Beverage visit:
HTTP://WWW.GLOBALBEVERAGESOLUTIONS.COM.
FORWARD-LOOKING STATEMENTS
This press release may contain certain forward-looking statements, including statements with regard to the future performance of Global Beverage. Words such as "believes," "expects," "projects," "should," and "future" or similar expressions are intended to identify forward-looking statements. These forward-looking statements are subject to the inherent uncertainties in predicting future results and conditions. Certain factors could cause actual results to differ materially from those projected in these forward-looking statements, and some of these factors are enumerated in Global Beverage's Form 10-K for the year ended December 31, 2006, and other filings with the Securities and Exchange Commission. Global Beverage undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.