GLOBAL REALTY DEVELOPMENT CORP
---------------------------------
Convertible Secured Subordinated Promissory Note
THESE SECURITIES
HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAWS.
THEY MAY NOT BE SOLD, TRANSFERRED,
PLEDGED, HYPOTHECATED
OR ASSIGNED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION
STATEMENT AS TO THE
SECURITIES
UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS
OR THE AVAILABILITY OF AN EXEMPTION FROM
REGISTRATION
UNDER SAID
ACT. INVESTMENT IN THIS NOTE HEREIN IS
SPECULATIVE AND INVOLVES A HIGH DEGREE OF RISK.
AUD$3,200,000
As of 20 August, 2005
New York, New York
For value received, the undersigned, Global Realty Development Corp,
a
Delaware company (the "Payor"), hereby promises to pay Sapphire
Developments
Limited, (the "Payee"), having an address at 60 Market Square,
P.O. Box 364,
Belize City, Belize in legal tender of the
Commonwealth of Australia, pursuant
to the following instructions, the principal sum of
Three Million Two Hundred
Thousand Australian Dollars (AUD$3,200,000)
("Principal") together with interest
thereon from the date hereof at the rate of One
(1%) percent per annum or the
highest rate permitted by law whichever is
lower ("Interest"). This Note shall
be subordinate to any bank indebtedness incurred prior to the date
hereof.
The Principal and any accrued interest shall be sent pursuant to the
payment schedule attached hereto via wire transfer to the following
account
maintained by Payee's counsel:
Commerce
Bank
582-586
9th Avenue
New York, NY 10036
ABA - 026 013 673
Swift
- CBNAUS 33
Title:
Rubin, Bailin, Ortoli, Mayer & Baker LLP
Account
- 7916582815
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This
Note is subject to the express
condition that at no time shall Payor
be obligated or required to pay
interest on the Principal at a rate which could
subject Payee to either civil or criminal liability as a result
of being in
excess of the maximum rate which Payor is
permitted by law to contract or agree
to pay. If by the terms of this Note, Payor
is at any time required or obligated
to pay interest on the Principal at a
rate in excess of such maximum rate, the
rate of interest under this Note shall be deemed to
be immediately reduced to
such maximum rate and interest payable hereunder shall be computed at
such
maximum rate and the portion of all prior interest
payments in excess of such
maximum rate shall be applied and shall be deemed to have been
payments in
reduction of the money owed.
Provided
that there shall have been no occurrence of
an Event of Default
(as that term is defined in the Security
Agreement) under the terms of this note
or the Security Agreement, payments
are to be paid in monthly installments with
combined principal and interest as follows:
commencing on September 20, 2005 and
in accordance with the schedule attached
hereto as EXHIBIT
A.
It is acknowledged and agreed to by
the Payor and Payee, that the Payee is
lending the Principal to Payor for the sole purpose of
effecting a settlement
transaction between the shareholders of Dominion Estates Pty Ltd.,
Dominion
Wines Ltd. (collectively, "Dominion
Group") and Atlantic Wine Agencies, Inc., a
Florida corporation ("Atlantic") whereby
upon the execution of the Note and the
return of up to Twenty Million (20,000,000)
shares of Atlantic common stock to
Atlantic from the shareholders of the Dominion
Group free of any encumbrances,
among other consideration, Atlantic shall transfer, free of
any encumbrances,
all of the Ordinary Shares of Dominion Estates Pty Ltd. ("Settlement
Transaction").
1. Principal and Interest.
------------------------
Subject to
the provisions of Section 2 below, the entire
outstanding
principal balance of this Note, together with all
interest accrued and unpaid
thereon, shall be due and payable on August 19, 2006 (the
"Maturity Date").
Notwithstanding any of the foregoing, in the event that the Payor fails
to
provide the Collateral in accordance with the Security
Agreement, then and in
such event the entire outstanding
principal balance of this Note, together with
all interest accrued and unpaid thereon, shall become immediately due and
payable. Payor may prepay this Note, in whole or
in part, at any time upon ten
(10) days notice to Payee without prepayment
premium or penalty, provided that
Payee may elect to convert all or part of this Note during such
period. In
addition to said payments of Principal and Interest, Payor shall pay such
additional payments or other payments as
provided for in the Security Agreement
executed simultaneously herewith and found in the form attached hereto as
EXHIBIT B.
2. Conversion.
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2
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2.1 This Note is convertible in multiples of $100,000 of the
principal due under this Note, into the number of shares of common
stock
of the Company at any date commencing no less than Ninety (90) days
from
the date hereof through the date of
maturity at the average closing bid
price as recorded on
www.otcbb.com for the 10 business days immediately
preceding the
election of conversion ("Conversion Rate" and "Common
Shares",
respectively);
provided, however,
that the right to
convert
this Note is subject to the provisions of
Section 1 above in the event
that the Company elects to prepay this Note. Any
Common Shares issued
pursuant to
this Note shall be issued pursuant to Regulation S as
promulgated by
the Securities Act of 1933, as amended ("Act").
Conversion may
be made at any time
commencing no less than Ninety (90)
days from the date hereof through the date of maturity, at the
option of
the Payee,
up to and including the Maturity Date;
provided that the
right to convert this Note is subject to the provisions
of Section 1
above in the event that the Company elects to prepay this
Note. For
conversion, the
Payee must present this Note at the office or
agency
designated for
payments along with the conversion form in the form
annexed hereto
as EXHIBIT C. No service charge will be made
for such
conversion; however,
the Payor may require
payment of a sum sufficient
to cover any tax or other governmental charge payable in connection
with
the conversion of this Note.
2.2 If the Payor, (a) splits or combines its outstanding Common
Shares into a greater or lesser number of Common Shares, (b)
distributes
any Common
Shares (or securities exchangeable for or
convertible into
Common Shares) to the Payee by way of stock dividends, other than
such a
distribution of
Common Shares (or securities exchangeable for or
convertible into
Common Shares) to Payee of Common Shares who exercises
an option to receive stock dividends in lieu of receiving cash
dividends
paid in the ordinary course, (c) distribu
