DEMAND NOTE


 


(ONE-LA)


 


New York, New York


$868,000.00


As of August 24, 2007


 


FOR
VALUE RECEIVED, THE ONE GROUP, LLC, a Delaware limited liability company, having an address at 411 West 14th Street, Suite
200, New York, New York 10014 (hereinafter referred to as "Maker"), promises to pay to the order of RCI II, LTD,
a Jersey Island limited liability company (hereinafter referred to as "Payee"), at 411 West 14th Street, Suite 200,
New York, New York 10014 or at such other place as the holder hereof may from time to time designate in writing, the principal
sum of EIGHT HUNDRED SIXTY EIGHT THOUSAND AND 00/100 DOLLARS ($868,000.00), in lawful money of the United States
of America, at the place and in the marmer hereinafter provided, with interest thereon to be computed from the date of the first
Disbursement (as hereinafter defined) on the outstanding principal balance of this Note from time to time (hereinafter referred
to as the "Principal Balance") at the rate of six percent (6.00%) per annum and to be paid on DEMAND. Interest
shall be computed and shall accrue using the actual number of days elapsed for the relevant payment period, based on 360-day year.


 


ARTICLE 1: PAYMENTS


 


The
entire unpaid Principal Balance of this Note, together with all accrued and unpaid interest thereon, shall be due and payable
in full on DEMAND.


 


ARTICLE 2: DISBURSEMENTS


 


As
of the date hereof, Payee has made disbursements of principal to Maker (each a "Disbursement") in the aggregate principal
amount of $868,000.00 on the dates and in the amounts set forth in the Disbursement Schedule attached hereto as Schedule A
and made a part hereof. Maker hereby acknowledges and agrees that (i) interest has accrued on the outstanding Principal Balance
as of the date of the first Disbursement and (ii) Payee's determination of the interest accrued on the Principal Balance shall
be absolute, final and binding upon Maker, absent manifest error.


 


ARTICLE 3: DEFAULT
INTEREST


 


Maker
does hereby agree that upon the failure of Maker to pay the Principal Balance in full when due, Payee shall be entitled to receive
and Maker shall pay interest on the entire Principal Balance at the rate of fifteen percent (15%) or at the maximum rate of interest
which Maker may by law pay, whichever is lower (the "Default Rate"), to be computed from the date of demand,
until the actual receipt and collection of the Principal Balance. This charge shall be added to the Principal Balance. This clause,
however, shall not be construed as an agreement or privilege to extend the date of the payment of the Principal Balance, nor as
a waiver of any other right or remedy accruing to Payee by reason of the occurrence of any Event of Default.


 






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ARTICLE 4: PREPAYMENT


 


Maker
may prepay the Principal Balance, in whole or in part, without additional penalty or premium.


 


ARTICLE 5: SAVINGS
CLAUSE


 


This
Note is subject to the express condition that at no time shall Maker be obligated or required to pay interest on the Principal
Balance due hereunder at a rate which could subject Payee to either civil or criminal liability as a result of being in excess
of the maximum interest rate which Maker is permitted by applicable law to contract or agree to pay. If by the terms of this Note,
Maker is at any time required or obligated to pay interest on the Principal Balance due hereunder at a rate in excess of such maximum
rate, the applicable interest rate payable hereunder shall be deemed to be immediately reduced to such maximum rate and all previous
payments in excess of the maximum rate shall be deemed to have been payments in reduction of principal and not on account of the
interest due hereunder.


 


ARTICLE 6: NO ORAL
CHANGE


 


This
Note may not be modified, amended, waived, extended, changed, discharged or terminated orally or by any act or failure to act on
the part of Maker or Payee, but only by an agreement in writing signed by the party against whom enforcement of any modification,
amendment, waiver, extension, change, discharge or termination is sought.


 


ARTICLE 7: JOINT
AND SEVERAL LIABILITY


 


If
Maker consists of more than one person or party, the obligations and liabilities of each such person or party shall be joint and
several.


 


ARTICLE 8: WAIVERS


 


Maker
and all others who may become liable for the payment of all or any part of the Principal Balance do hereby severally waive presentment
and demand for payment, notice of dishonor, protest and notice of protest and non-payment. No release of any security for the Principal
Balance or extension of time for payment of this Note or any installment hereof, and no alteration, amendment or waiver of any
provision of this Note, the Mortgage made by agreement between Payee and any other person or party shall release, modify, amend,
waive, extend, change, discharge, terminate or affect the liability of Maker, and any other who may become liable for the payment
of all or any part of the Principal Balance, under this Note.


 


ARTICLE 9: AUTHORITY


 


Maker
represents that Maker has full power, authority and legal right to execute and deliver this Note, and that this Note constitutes
a valid and binding obligation of Maker.


 






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ARTICLE 10: TRANSFER


 


Payee shall
have the right to transfer, sell and assign this Note and the obligations hereunder. All references to "Payee" hereunder
shall be deemed to include tbe assigns of Payee.


 


ARTICLE 11: GOVERNING
LAW


 


This Note
shall be governed by the laws of tbe State of New York and the applicable laws of the United States of America.


 


ARTICLE 12: WAIVER
OF TRIAL BY JURY


 


MAKER
HEREBY WAlVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM, WHETHER
IN CONTRACT, TORT OR OTHERWISE, RELATING DIRECTLY OR INDIRECTLY TO THE LOAN EVIDENCED BY TIDS NOTE, THE APPLICATION FOR THE LOAN
EVIDENCED BY THIS NOTE OR ANY ACTS OR OMISSIONS OF PAYEE, ITS OFFICERS, EMPLOYEES, DIRECTORS OR AGENTS IN CONNECTION THEREWITH.


 


ARTICLE 13: COUNSEL
FEES


 


In the
event tbat it should become necessary for Payee to employ counsel to collect tbe Principal Balance or to protect or foreclose tbe
security therefor or to otherwise enforce its rights and remedies under this Note, Maker also agrees to pay all reasonable fees
and expenses of Payee, including, without limitation, reasonable attorneys' fees for tbe services of such counsel whether or not
suit be brought.


 


ARTICLE 14: BUSINESS,
COMMERCIAL OR INVESTMENT PURPOSES


 


Maker
represents tbat the Loan evidenced by this Note is being made solely for business, commercial or investment purposes.


 


ARTICLE 15: RECOURSE


 


This Note is full recourse
to Maker, and Payee shall have recourse to Maker to the fullest extent provided by law upon any action to enforce tbe obligations
of Maker under this Note.


 


[NO FURTHER TEXT
ON TIDS PAGE]


 






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IN WITNESS WHEREOF, Maker
has duly executed this Note the day and year first above written.


 








	 	MAKER	 
	 	 	 
	 	THE ONE GROUP, LLC	 
	 	 	 
	 	By:	 	 
	 		Jonathan Segal	 
	 		Managing Member	




  



    	 



    	 



    




 


SCHEDULE A


 


DISBURSEMENT
SCHEDULE


 


 


	DATE OF ADVANCE	 	 	AMOUNT
                                                             OF ADVANCE	 
	 	 	 	 	 
	12/31/06	 	$	29,000.00	 
	 	 	 	 	 
	5/18/07	 	$	100,000.00	 
	 	 	 	 	 
	5/24/07	 	$	50,000.00	 
	 	 	 	 	 
	6/12/07	 	$	539,000.00	 
	 	 	 	 	 
	7/05/07	 	$	100,000.00	 
	 	 	 	 	 
	8/24/07	 	$	50,000.00	 
	 	 	 	 	 
	TOTAL
                                                                           ADVANCED:
	 	$	868,000.00