Exhibit 10.23
SECURED CONVERTIBLE NOTE AND AGREEMENT
$200,000.00
MAXMILLIAN PARTNERS LLC
April 8, 2003
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 THE NOTE HEREIN IS
SPECULATIVE AND INVOLVES A HIGH DEGREE OF
RISK. THE COMPANY IS IN ITS
DEVELOPMENT STAGE, HAS NO HISTORY OF REVENUES,
EARNINGS OR SIGNIFICANT
OPERATIONS, AND IS SUBJECT TO ALL THE RISKS INHERENT IN
A NEW BUSINESS ENTERPRISE. NO
INVESTMENT IN THE NOTES SHOULD BE MADE BY ANY
PERSON WHO IS NOT IN A POSITION TO
LOSE THE ENTIRE AMOUNT OF SUCH INVESTMENT.
RECITALS
WHEREAS, Maxmillian Partners LLC (the "Borrower"), a Delaware
limited
liability company, operating
pursuant to a certain Amended and Restated Limited
Liability Company Agreement, dated
as of September 24, 2002 (the "Operating
Agreement"); and
WHEREAS, Borrower requires short-term working capital in connection
with
current operations, and Nexcomm
International Beverage, LLC, a current unit
holder of the Company ("Holder")
has agreed to lend to Borrower $200,000, upon
the terms stated herein, including
without limitation Holders' right, but not
the obligation, prior to
repayment, to convert all, or such part as Holder
shall elect, of the principal
amount due hereunder, together with the interest
then accrued thereon, into
additional units of the Company issued in connection
with any subsequent capital
financing of the Company (a "Financing"), or such
other equity securities, as shall
be sold by Borrower in connection with the
completion of the Financing, if
any, upon the same terms as are offered to
investors generally. Holder shall
be issued warrants for units in the Borrower
("Principal Warrants"), together
with certain contingent warrants to be issued
in the event of a default
hereunder ("Default Warrants", and together with the
Financing Warrants, referred to
herein and therein as the "Warrants"), all in
accordance with the terms of the
Convertible Note Warrant Agreement ("Warrant
Agreement"), of even date
herein
<PAGE>
FOR VALUE RECEIVED, MAXMILLIAN PARTNERS LLC, a Delaware limited
liability company, having a principal place
of business at 372 Danbury Road,
Suite 163, Wilton, Connecticut (the
"Borrower"), promises to pay to NEXCOMM
INTERNATIONAL BEVERAGE, LLC, (the "Holder")
at the offices of the Holder located
in Southport, Connecticut, or at such other
place as Holder shall designate, the
principal sum of Two Hundred Thousand and
00/100 Dollars ($200,000.00) or, if
then prepaid in part, the outstanding
principal amount, on September 8, 2003
("Expiration Date"), together with interest
accrued upon the outstanding
principal amount advanced hereunder from
time to time, calculated on the basis
of a 360-day year for the actual number of
days elapsed, at the rate of eight
(8%) percent (Interest"), from the date of
this Secured Convertible Note and
Agreement (the "Note"),until the Expiration
Date. In no event shall the Interest
hereunder exceed the maximum rate permitted
by applicable law. Any payment in
excess of the maximum rate shall be deemed
a prepayment of principal. Each
payment shall be applied first to the
payment of Interest and then to the
payment of principal. In addition to the
other remedies available to Holder
herein, and the Default Adjustment set
forth in the Warrant Agreement issued by
Borrower to Holder in connection herewith,
in the event of default, the Interest
applicable to this Note shall be 3% above
that rate herein, before as well as
after judgment, order or other
determination. The principal amount of this Note
shall be advanced upon the request of the
Borrower, and at the sole discretion
of the Holder in accordance with the
conditions herein. The proceeds of this
Note shall be used for normal short-term
working capital needs of the Borrower.
ARTICLE ONE
PREPAYMENT
This Note shall not without the prior written consent of the
Holder, be
subject to prepayment in whole or
in part by Borrower, at any time prior to the
earlier of (i) the date on which
the Holder waives, releases or terminates its
option to convert this Note into
the equity securities of the Company as set
forth hereinbelow, and (ii) the
Expiration Date, it being the intention of the
parties that this Note shall
either be (A) paid in full with Interest thereon
at the Expiration Date, or (B)
subject to Holder's prior demand on account of
default, converted to units of the
Company upon the date of the closing of any
Financing, , upon the terms more
fully set forth in ARTICLE TWO below
("Conversion Units").
ARTICLE TWO
CONVERSION RIGHTS
2.1 Conversion. At any time prior to the Expiration Date, in the
event
Borrower shall propose to complete
a Financing, Holder shall have the right,
exercisable upon written notice to
Borrower, to convert in whole or in part,
any outstanding principal amount
hereunder together with any and all unpaid
Interest accrued thereon (the
"Obligation") into the Units offered by Borrower
in such Financing, upon such terms
as are offered to the investors in the
Financing generally.
<PAGE>
2.2 Conversion Mechanics. In the event Borrower shall intend to
complete
a Financing prior to the Expiration Date,
and shall prepare any term sheet for
such purpose at any time prior to the
Expiration Date, Borrower shall provide
Holder with written notice of the terms and
other particulars pertaining to such
Financing, whereupon at any time on or
prior to the closing date of such
Financing (after all applicable extensions
provided in the Term Sheet), Holder
shall have the right, exercisable within by
Borrower upon notice to Borrower at
any time prior to repayment of this Note
and the date of closing of such
Financing, to convert, in whole or in part,
the amount then representing the
Obligation, into such equity securities as
are sold or issued by Borrower in
connection with the Financing, and
otherwise upon the terms made part of the
offering thereof.
ARTICLE THREE
EVENTS OF DEFAULT/SECURITY
3.1 Default. In the event Borrower shall: (a) fail to pay any
amount of
the principal or accrued Interest
hereupon as same shall become due and
payable; (b) breach any of the
material covenants or any representation or
warranty of Borrower as set forth
herein or in the Warrant Agreement issued in
connection herewith; or (c) any
default by Maxmillians Mixers LLC or Drinks
Americas, Inc. (the "Guarantors")
pursuant to the terms of the Guaranties or
the Security Agreements delivered
by them as security for the Obligations
hereunder, then at the option of
the Holder hereof, and in addition to all
other remedies at law or in
equity, including without limitation, Holder's
right to exercise its security
interest in accordance with the provisions of
the Article 9 of the Uniform
Commercial Code of the State of Connecticut, all
amounts of principal and interest
th
