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Exhibit 10.1
 
PROMISSORY NOTE

$200,000.00
October 13, 2010

For value received, INTERNATIONAL STAR, INC. (“Promisor”), promises to pay to
the order of BEAIRD OPERATING COMPANIES, L.L.C. (“Payee”), at 330 Marshall,
Suite 1112, Shreveport, Louisiana, 71101 (or at such other place as Payee may
designate in writing), as follows:

$200,000.00 plus 12% simple interest per year on the outstanding principal
balance, on the date 14 months after the date of execution of this promissory
note (“Note”) when all outstanding principal and any accrued but unpaid interest
shall be due and payable in full (the “Due Date”), subject to the provisions
contained herein below.

At any time while any amount owed under this Note remains unpaid, Payee shall
have the option to: (a) demand payment in accordance with the terms set forth
above; or (b) as an alternative, convert Payee’s warrants to purchase 20,000,000
(twenty million) shares of Promisor’s common stock (the “Warrants”) into common
stock according to the terms of the Warrant Agreement between Promisor and Payee
dated the date hereof, in full satisfaction of the Note; or (c) as a further
alternative, Payee may leave the amount owed hereunder intact and exercise the
Warrants by paying Promisor $200,000.00 for same.

This Note and ALL obligations contained herein shall be secured by a priority
security interest/lien in the form of a 49% (forty-nine percent) interest
in:  (a) the mineral rights of all mining claims which Promisor owns or has an
interest in, whether now or in the future, in the Detrital Wash properties
located in Mohave County, Arizona, and (b) all future claims of Promisor in the
revenues generated by or from such properties.  At Promisor’s option, said
security interest may be converted to a priority security interest/lien on 49%
of Promisor’s share of proceeds from any joint venture or licensing agreement
which Promisor enters in order to develop the above-referenced mining claims,
PROVIDED THAT, at the time of the proposed conversion of the security interest,
the joint venture partner or licensee is a solvent company and such joint
venture partner or licensee estimates in good faith that the fair market value
of the claims that are subject to the joint venture or licensing agreement is
equal to or greater than twice the amount of the then outstanding principal
balance.  Promisor agrees to execute whatever documentation is determined
reasonable by Payee in order to evidence and perfect any and all of the
liens/security interests securing this Note.

If all amounts owed under this Note are not fully paid on or before the Due
Date, and Payee does not convert to repayment by way of the Warrants, the unpaid
principal balance loan will be subject to a 1.5 x liquidation preference (e.g.,
principal due would increase to $300,000.00 if the unpaid principal balance is
$200,000 after Due Date) and will accrue simple interest after the Due Date at
12% per annum of the liquidation preference amount.  After the Due Date, Payee,
in its discretion, may:  (i) deem any such outstanding balance fully satisfied
upon Payee’s subsequent conversion of all of the Warrants as described above,
(ii) reduce the outstanding balance owed upon exercise of the Warrants in an
amount equal to the exercise price of some or all of the Warrants exercised and
maintain any additional balance as outstanding debt owed, or (iii) maintain the
entire outstanding balance as debt owed by paying cash only upon exercise of any
Warrants.

 
 

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All payments shall be applied first in payment of accrued interest and any
remainder in payment of principal.  This Note may be prepaid, in whole or in
part, at any time without penalty.

If any payment obligation under this Note is not paid when due, Promisor
promises to pay all costs of collection, including reasonable attorney fees not
to exceed 20% (twenty percent) of the amount sought to be collected, whether or
not a lawsuit is commenced as part of the collection process.

If any of the following events of default occur, this Note shall become due
immediately, without demand or notice:

(1)  
the dissolution of Promisor;

(2)  
the filing of bankruptcy proceedings involving Promisor as a Debtor;

(3)  
the application for appointment of a receiver for Promisor;

(4)  
the making of a general assignment for the benefit of Promisor’s creditors;

(5)  
the insolvency of Promisor;

No renewal or extension of this Note, delay in enforcing any right of Payee
under this Note, or assignment by Payee of this Note shall affect the liability
of Promisor.  All rights of Payee under this Note are cumulative and may be
exercised concurrently or consecutively at Payee’s option.

This Note shall be construed in accordance with the laws of the State of
Louisiana.

If any one or more of the provisions of this Note are determined to be
unenforceable, in whole or in part, for any reason, the remaining provisions
shall remain fully operative and the objectionable provison shall be conformed
to the minimum extent necessary to comply with applicable law.

All payments of principal and interest on this Note shall be paid in the legal
currency of the United States.

Promisor waives presentment for payment, demand, notice of non-payment, protest,
and notice of protest and nonpayment of this Note, and all pleas of division or
discussion, and consents that time of payment may be extended without notice
hereof.

Signed this 13th day of October, 2010.

  INTERNATIONAL STAR, INC. (PROMISOR)

  By: /s/ Sterling M. Redfern______________
        Name:  Sterling M. Redfern
        Title:  President