Exhibit 10.1

DEMAND PROMISSORY NOTE

 

$1,900,000.00    April 5, 2007

FOR VALUE RECEIVED, FOREFRONT HOLDINGS, INC., a Florida corporation (the
“Maker”), with its principal address at 835 Bill Jones Industrial Drive,
Springfield, Tennessee 37172, unconditionally promises to pay to the order of
STANFORD INTERNATIONAL BANK LTD. (the “Payee”), having an office at No. 11
Pavilion Drive, St. John’s, Antigua, West Indies, ON DEMAND, the principal
amount of ONE MILLION NINE HUNDRED THOUSAND AND 00/100 ($1,900,000.00) DOLLARS,
or so much thereof as the Payee advances to the Maker through the date of
demand, pursuant hereto, together with interest on the unpaid principal balance
from time to time outstanding under this promissory note (this “Note”), at the
rate of eight percent (8.00%) per annum, compounding on the basis of a 360-day
year for the actual number of days elapsed from the date hereof through, until
and including the time of the demand at which time the entire unpaid principal
balance and all accrued and unpaid interest shall become due and payable.

Advances under this Note shall be made by the Payee to the Maker as follows:
(a) $650,000 on the date hereof; (b) $650,000 on or about April 10, 2007; and
(c) $600,000 on or about April 12, 2007.

All payments of interest and of principal shall be payable in lawful money of
the United States of America in immediately available funds, without setoff,
counterclaim or deduction of any kind. Each payment hereunder shall first be
applied to accrued and unpaid interest and then in reduction of the outstanding
principal balance, unless other costs and charges are payable pursuant to the
terms of this Note, in which event, in Payee’s sole discretion, such costs and
charges shall first be paid. This Note shall be construed and enforced in
accordance with Florida law (the “Applicable Law”). This Note may be prepaid in
whole or in part at any time without premium or penalty.

Maker agrees to pay all costs and expenses incurred by Payee, including
reasonable attorneys’ fees and legal costs and expenses, in the negotiation and
preparation of this Note as well as in collecting any sums due under this Note
or in enforcing the terms and conditions of the Note, whether for services
incurred in collection, litigation proceedings at pre-trial, trial and appellate
levels, bankruptcy proceedings or otherwise.

The indebtedness evidenced by this Note is subordinate in right of payment to
certain other obligations of the Maker to FCC, LLC, d/b/a First Capital, a
Florida limited liability company, pursuant to that certain Guaranty, dated as
of October 15, 2004, as at any time amended, restated, supplemented or otherwise
modified.

Any notice, consent, approval or communication given pursuant to the provisions
of this Note shall (except where otherwise permitted by this Note) be in writing
and shall be (a) delivered by hand, (b) mailed by certified mail or registered
mail, return receipt requested, postage prepaid, or (c) delivered by a
nationally recognized overnight courier, U.S. Post Office Express Mail, or
similar overnight courier which delivers only upon signed receipt of the
addressee. The time of the giving of any notice shall be the time of receipt
thereof by the addressee or any agent of the addressee, except that in the event
the addressee or such agent of the addressee

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shall refuse to receive any notice given as above provided or there shall be no
person available at the time of delivery thereof to receive such notice, the
time of the giving of such notice shall be the time of such refusal or the time
of such delivery, as the case may be. Such notices shall be given to the Maker
and the Payee at the addresses provided herein.

The following are events of default hereunder: (a) the failure of Maker to pay
any obligation, liability or indebtedness to the Payee, whether under this Note,
as and when due (whether upon demand, at maturity or by acceleration) including,
without limitation, those existing as of the date of execution; (b) the
commencement of a proceeding against Maker for dissolution or liquidation (which
proceeding is not discharged within 45 days after commencement), the voluntary
or involuntary termination or dissolution of Maker or the merger or
consolidation of Maker with or into another entity; (c) the insolvency of, the
business failure of, the appointment of a custodian, trustee, liquidator or
receiver for or for any of the property of, the assignment for the benefit of
creditors by, or the filing of a petition under bankruptcy, insolvency or
debtor’s relief law (which petition is not discharged within 45 days after
filing) or the filing of a petition for any adjustment of indebtedness,
composition or extension by or against Maker (which petition is not discharged
within 45 days after filing); (d) the breach of any covenant made by the Maker
to the Payee; (e) the entry of a material judgment against Maker not paid or
bonded within 45 days after entry; (f) the seizure or forfeiture of, or the
issuance of any writ of possession, garnishment or attachment, or any turnover
order for any property of Maker; or (g) the occurrence of a material adverse
change in the financial condition of Maker.

Whenever there is an event of default under this Note (a) the entire balance
outstanding hereunder and all other obligations of Maker to the Payee (however
acquired or evidenced) shall, at the option of Payee, become immediately due and
payable, and/or (b) to the extent permitted by law, the rate of interest on the
unpaid principal shall be increased at the Payee’s discretion up to 18% per
annum (the “Default Rate”). The provisions herein for a Default Rate and a
delinquency charge shall not be deemed to extend the time for any payment
hereunder or to constitute a “grace period” giving Maker a right to cure any
default. At the Payee’s option, any accrued and unpaid interest, fees or charges
may, for purposes of computing and accruing interest on a daily basis after the
due date of this Note or any installment thereof, be deemed to be a part of the
principal balance, and interest shall accrue on a daily compounded basis after
such date at the Default Rate provided in this Note until the entire outstanding
balance of principal and interest is paid in full.

The remedies of Payee as provided herein shall be cumulative and concurrent and
may be pursued singly, successively, or together at the sole discretion of Payee
and may be exercised as often as occasion therefore shall arise. The acceptance
by Payee of any payment under this Note which is less than the amount then due
or the acceptance of any amount after the due date thereof, shall not be deemed
a waiver of any right or remedy available to Payee nor nullify the prior
exercise of any such right or remedy by Payee. None of the terms or provisions
of this Note may be waived, altered, modified or amended except by a written
document executed by Payee and the Maker, and then only to the extent
specifically recited therein. No course of dealing or conduct shall be effective
to waive, alter, modify or amend any of the terms or provisions hereof. The
failure or delay to exercise any right or remedy available to Payee shall not
constitute a waiver of the right of the Payee to exercise the same or any other
right or remedy available to Payee at that time or at any subsequent time.

 

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Notwithstanding any provision of this Note, the Payee does not intend to charge
and Maker shall not be required to pay any amount of interest or other charges
in excess of the maximum rate permitted by Applicable Law as amended from time
to time. Should any interest payment or other payment of the loan evidenced by
this Note result in the computation or earning of interest in excess of the
highest rate permissible under Applicable Law, then any and all such excess
shall be and the same is hereby waived by Payee, and all such excess shall be
credited by Payee against the unpaid principal balance of this Note or paid by
Payee to Maker or to any parties liable for the repayment of the loan evidenced
by this Note, in the sole discretion of Payee. It is the intent of the parties
hereto that neither Maker, nor any parties liable for the repayment of the loan
evidenced by this Note, shall be required to pay interest in excess of the
highest rate permissible under Applicable Law as amended from time to time.

If any provision of this Note shall be deemed invalid, illegal or unenforceable
under Applicable Law, such invalidity, illegality or unenforceability shall not
affect any other provision (or remaining part of the affected provision) of this
Note and this Note shall be construed as if such invalid, illegal or
unenforceable provision (or part thereof) had not been contained herein.

To the fullest extent permitted by law, Maker and all sureties, endorsers and
guarantors of this Note, if any, hereby (a) waive demand, presentment for
payment, notice of nonpayment, protest, notice of protest, and all other notice,
filing of suit, and diligence in collecting this Note; (b) agree to the addition
or release of any party or person primarily or secondarily liable hereon;
(c) waive any right to immunity from any action or proceeding brought in
connection with this Note or any instrument securing it and waive any immunity
or exemption of any property, wherever located, from garnishment, levy,
execution, seizure or attachment prior to or in execution of judgment, or sale
under execution or other process for the collection of debts; (d) waive any
right to interpose any setoff or counterclaim or to plead any statute of
limitations as a defense in any such action or proceeding, and waive all
statutory provisions and requirements for the benefit of Maker, now or hereafter
in force; (e) agree that Payee shall not be required first to institute any suit
or to exhaust its remedies against Maker or any other person or party liable
hereunder in order to enforce payment for this Note; and (f) consent to any
extension, rearrangement, renewal, or postponement of time of payment of this
Note and to any other indulgency with respect thereto without notice, consent or
consideration to any of them.

MAKER IRREVOCABLY AGREES THAT ANY ACTION OR PROCEEDING ARISING HEREUNDER OR
RELATING HERETO THAT IS BROUGHT BY MAKER SHALL BE TRIED BY THE COURTS OF THE
STATE OF FLORIDA SITTING IN MIAMI-DADE COUNTY, OR THE UNITED STATES DISTRICT
COURTS SITTING THERE. MAKER IRREVOCABLY SUBMITS, IN ANY SUCH ACTION OR
PROCEEDING THAT IS BROUGHT BY PAYEE, TO THE NON-EXCLUSIVE JURISDICTION OF EACH
SUCH COURT, IRREVOCABLY WAIVES THE DEFENSE OF AN INCONVENIENT FORUM WITH RESPECT
TO ANY SUCH ACTION OR PROCEEDING, AND AGREES THAT SERVICE OF PROCESS IN ANY SUCH
ACTION OR PROCEEDING MAY BE MADE UPON MAKER BY MAILING A COPY THEREOF TO MAKER
AT THE ADDRESS SET FORTH HEREIN (AS WELL AS BY ANY OTHER LAWFUL METHOD).

 

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PAYEE AND MAKER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT
THEY MAY HAVE TO A TRIAL BY JURY AND TO BRING ANY ACTION IN THE NATURE OF A
PERMISSIVE COUNTERCLAIM WITH RESPECT TO ANY LITIGATION BASED HEREON, OR ARISING
OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE AND ANY AGREEMENT CONTEMPLATED TO
BE EXECUTED IN CONNECTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE PARTIES. THIS PROVISION
IS A MATERIAL INDUCEMENT FOR THE PAYEE ENTERING INTO THE LOAN TRANSACTION
EVIDENCED BY THIS NOTE.

Dated and executed this 5th day of April, 2007.

MAKER: FOREFRONT HOLDINGS, INC. By:  

/s/ Michael S. Hedge

  Michael S. Hedge   Chief Executive Officer

 

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