Promissory Note


    Exhibit
      10.11

    


    PROMISSORY
      NOTE

     

    
      	
              $4,450,000

               

            	
              June
                26, 2007

               

            


    

    FOR
      VALUE
      RECEIVED, the undersigned, COSTA
      BLANCA I REAL ESTATE, LLC,
      a
      Florida limited liability company, having an address at 2460 Sand Lake Road,
      Orlando, Florida 32809, (the “Borrower”),
      promises to pay to the order of KENNEDY
      FUNDING, INC.
      (“Agent”),
      with
      an office at Two University Plaza, Suite 402, Hackensack, New Jersey 07601,
      as
      agent for the lenders identified on Schedule
      A
      annexed
      hereto (Agent and the lenders identified on Schedule A are hereinafter
      collectively referred to as “Lender”),
      the
      principal sum of FOUR
      MILLION FOUR HUNDRED FIFTY THOUSAND ($4,450,000) DOLLARS,
      or so
      much thereof as may be advanced by Lender to Borrower from time to time (the
      “Principal
      Amount”),
      together with interest on the unpaid Principal Amount thereof computed from
      the
      date advanced (the “Commencement
      Date”),
      at
      the rates provided herein until June 25, 2010 or such earlier date on which
      the
      Principal Amount becomes due and payable as provided herein (the “Maturity
      Date”);
      provided, however, that from and after (i) the Maturity Date, whether upon
      stated maturity, acceleration or otherwise, or (ii) the date on which the
      interest rate hereunder is increased to the Default Rate (as hereinafter
      defined) as provided herein, such additional interest shall be computed at
      the
      Default Rate.

     

    As
      used
      herein, the term “Default
      Rate”
shall
      mean a rate of interest of twenty-four percent (24.0%) per annum, but in no
      event shall the Default Rate be in excess of the Maximum Rate (as hereinafter
      defined).

     

    If
      any
      payment of interest is not paid within five (5) days from the due date for
      such
      payment, a late charge equal to the lesser of ten percent (10%) of such overdue
      payment or the maximum amount permitted by applicable law shall automatically
      become due to the holder of this promissory note (the “Note”),
      subject, however, to the limitation that late charges may be assessed only
      once
      on each overdue payment. Said late charges do not constitute interest and shall
      constitute compensation to the holder of this Note for collection and co-lender
      administration costs incurred hereunder. In addition, if any payment of
      principal or interest is not paid when due, the holder of this Note shall have
      the right, upon notice to Borrower, to increase the rate of interest per annum
      on all amounts outstanding to the Default Rate and, upon said notice, such
      rate
      increase shall be effective retroactively as of the date from which the interest
      component of such overdue payment began to accrue and shall remain in force
      and
      effect for so long as such default shall continue. This paragraph shall not
      be
      construed as an agreement or privilege to extend the due date of any payment,
      nor as a waiver of any other right or remedy accruing to the holder of this
      Note
      by reason of any default.

     

    


    
      
        
          


           

          
          

        

        
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      Principal
        and interest hereunder shall be payable as follows:



    (a) From
      the
      Commencement Date, interest on the Principal Amount outstanding hereof shall
      accrue at the rate of Twelve (12.0%) percent per annum, for the period beginning
      on and including the Commencement Date to the last day of the month in which
      the
      Commencement Date occurs (“Short
      Interest”),
      and
      shall be payable on August 1, 2007.

     

    (b) Interest
      only at the rate per annum equal to the greater of (i) Twelve (12%) percent
      and
      (ii) the Prime Rate (as defined below) as adjusted from time to time, plus
      Three
      and Three Quarters (3 3/4%) Percent on the Principal Amount outstanding hereof
      shall accrue from July 1, 2007 through June 30, 2008 and be paid monthly, in
      arrears, in an amount, as determined by Lender, equal to one-twelfth (1/12th)
      of
      the annual interest payments for such period commencing August 1, 2007 and
      continuing on the first day of each month thereafter through and including
      July
      1, 2008.

     

    (c) Interest
      only at the rate per annum equal to the greater of (i) Sixteen (16%) percent
      and
      (ii) the Prime Rate (as defined below) as adjusted from time to time, plus
      Seven
      and Three Quarters (7 3/4%) Percent on the Principal Amount outstanding hereof
      shall accrue from July 1, 2008 through June 30, 2009 and be paid monthly, in
      arrears, in an amount, as determined by Lender, equal to one-twelfth (1/12th)
      of
      the annual interest payments for such period commencing August 1, 2008 and
      continuing on the first day of each month thereafter through and including
      July
      1, 2009.

     

    (d) Interest
      only at the rate per annum equal to the greater of (i) Eighteen (18.0%) percent
      and (ii) the Prime Rate, as adjusted from time to time, plus Nine and Three
      Quarters (9 3/4%) Percent, on the Principal Amount outstanding hereof shall
      accrue from July 1, 2009 through the Maturity Date and be paid monthly in
      arrears, in an amount, as determined by Lender, equal to one-twelfth (1/12th)
      of
      the annual interest payment for each twelve (12) month period commencing on
      August 1, 2009 and continuing on the first day of each month thereafter until
      the Maturity Date.

     

    (e) All
      principal, interest and other sums due hereunder shall be due and payable in
      full on the Maturity Date.

     

    As
      used
      herein, the term “Prime Rate” shall mean the rate of interest published in The
      Wall Street Journal from time to time as the "Prime Rate." If more than one
      "Prime Rate" is published in The Wall Street Journal for a day, the average
      of
      such "Prime Rates" shall be used, and such average shall be rounded up to the
      nearest one-eighth of one percent (0.125%). If The Wall Street Journal ceases
      to
      publish the "Prime Rate," the Agent shall select an equivalent publication
      that
      publishes such "Prime Rate," and if such "Prime Rates" are no longer generally
      published or are limited, regulated or administered by a governmental or
      quasigovernmental body, then Agent shall select a comparable interest rate
      index. If interest on this Note is calculated at the Prime Rate as provided
      herein, then the interest rate will change on July 1, 2007 and on the first
      day
      of each month thereafter following any change in the Prime Rate.

     

    


    
      
        
          


           

          
          

        

        
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    (f) Prepaid
      Interest (as defined in the Loan and Security Agreement of even date herewith,
      hereinafter, the “Loan
      Agreement”),
      if
      any, shall be utilized in accordance with the terms of the Loan
      Agreement.

     

    Each
      payment hereunder shall be credited first to Lender’s collection expenses, next
      to late charges, next to unpaid interest, and the balance, if any, to the
      reduction of the Principal Amount. The interest on this Note shall be calculated
      on the basis of a 30-day month and a 360-day year.

     

    This
      Note
      may be prepaid in whole or in part at any time, without penalty or premium,
      it
      being understood and agreed that, except as expressly provided herein or in
      the
      Loan Agreement, Borrower shall not be entitled, by virtue of any prepayment
      or
      otherwise, to a refund of the Fee (as defined in the Loan Agreement), interest,
      any other fees, points, charges and the like paid by Borrower to Lender in
      connection with the loan hereunder (the “Loan”)
      and
      for fees and expenses incurred by Lender in making the Loan, all of which
      payments shall be retained by Lender from and after the date each such payment
      is made hereunder.

     

    Borrower
      and each surety, endorser and guarantor hereof hereby waive all demands for
      payment, presentations for payment, notices of intention to accelerate maturity,
      notices of acceleration of maturity, demand for payment, protest, notice of
      protest and notice of dishonor, to the extent permitted by law. Borrower further
      waives trial by jury. No extension of time for payment of this Note or any
      installment hereof, no alteration, amendment or waiver of any provision of
      this
      Note and no release or substitution of any collateral securing Borrower’s
      obligations hereunder shall release, modify, amend, waive, extend, change,
      discharge, terminate or affect the liability of Borrower under this
      Note.

     

    Any
      forbearance by the holder of this Note in exercising any right or remedy
      hereunder or under any other agreement or instrument in connection with the
      Loan
      or otherwise afforded by applicable law, shall not be a waiver or preclude
      the
      exercise of any right or remedy by the holder of this Note. The acceptance
      by
      the holder of this Note of payment of any sum payable hereunder after the due
      date of such payment shall not be a waiver of the right of the holder of this
      Note to require prompt payment when due of all other sums payable hereunder
      or
      to declare a default for failure to make prompt payment.

     

    If
      this
      Note is placed in the hands of an attorney for collection, Borrower shall pay
      all costs incurred and reasonable attorneys’ fees for legal services in the
      collection effort, whether or not suit be brought.

     

     

    


    
      
        
          


           

          
          

        

        
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      At
        the
        election of the holder of this Note, all payments due hereunder may be
        accelerated, and this Note shall become immediately due and payable without
        notice or demand, upon the occurrence of any of the following events (each
        an
“Event
        of Default”):
        (1)
        Borrower fails to pay on or before the date due, any amount of principal
        and/or
        interest payable hereunder; (2) Borrower fails to perform or observe any
        other
        term or provision of this Note with respect to payment; provided,
        however,
        that
        Borrower shall be provided with a ten (10) calendar day period to cure same;
        (3)
        Borrower fails to perform or observe any other term or provision of this
        Note;
provided,
        however,
        that
        Borrower shall be provided with written notice from Lender of any non-monetary
        default under this Note and a thirty (30) calendar day period to cure same;
        or
        (4) there exists a default under the Mortgage (as hereinafter defined), a
        default under any Guaranty (as hereinafter defined) or a default under or
        misrepresentation contained in any other agreement, document or certificate
        of
        Borrower or any Guarantor (as hereinafter defined) in connection with the
        Loan,
        which default is not cured within any grace period expressly provided therefor
        in such document. In addition to the rights and remedies provided herein,
        the
        holder of this Note may exercise any other right or remedy in any other
        document, instrument or agreement evidencing, securing or otherwise relating
        to
        the indebtedness evidenced hereby in accordance with the terms thereof, or
        under
        applicable law, all of which rights and remedies shall be
        cumulative.

    

     

    If
      this
      Note is transferred in any manner, the right, option or other provisions herein
      shall apply with equal effect in favor of any subsequent holder
      hereof.

     

    Notwithstanding
      anything to the contrary contained herein, under no circumstances shall the
      aggregate amount paid or agreed to be paid hereunder exceed the highest lawful
      rate permitted under applicable usury law (the “Maximum
      Rate”)
      and
      the payment obligations of Borrower under this Note are hereby limited
      accordingly. If under any circumstances, whether by reason of advancement or
      acceleration of the maturity of the unpaid principal balance hereof or
      otherwise, the aggregate amounts paid on this Note shall include amounts which
      by law are deemed interest and which would exceed the Maximum Rate, Borrower
      stipulates that payment and collection of such excess amounts shall have been
      and will be deemed to have been the result of a mistake on the part of both
      Borrower and the holder of this Note, and the party receiving such excess
      payments shall promptly credit such excess (to the extent only of such payments
      in excess of the Maximum Rate) against the unpaid principal balance hereof
      and
      any portion of such excess payments not capable of being so credited shall
      be
      refunded to Borrower.

     

     

     

    


    
      
        
          


           

          
          

        

        
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    This Note
      is
      secured by, among other things, that certain Mortgage and Security Agreement
      (the “Mortgage”),
      an
      assignment of leases and rents (“Assignment”),
      an
      assignment of licenses, contracts, plans, specifications, surveys, drawings
      and
      reports (the “Assignment
      of Licenses”),
      all
      of the foregoing being of even date herewith and a first lien on the certain
      real estate collateral (the “Collateral”)
      identified in the Mortgage, and is entitled to the benefits and security
      thereof. Reference is made to the Mortgage, Assignment and Assignment of
      Licenses for descriptions of the respective rights and obligations of the
      Borrower and Lender thereunder. This Note is guaranteed by the separate guaranty
      of even date herewith (the “Guaranty”)
      of
      American Leisure Holdings, Inc.,
      TDS
      Amenities, Inc. and Malcolm Wright (collectively, the “Guarantor”)
      and
      reference is made to the Guaranty for the respective rights of the parties
      thereunder. Borrower hereby agrees to indemnify, defend and hold harmless Lender
      from and against any and all claims, loss, cost, damage or expense (including,
      without limitation, reasonable attorneys’ fees) which may be incurred by Lender
      in connection with or as a result of any default (following notice and the
      opportunity to cure provided for in such document), other than consequential
      and
      incidental damages, by Borrower or Guarantor under the Mortgage, Assignment,
      or
      Assignment of Licenses, or by the Guarantor (following notice and the
      opportunity to cure provided for in such document) under the Guaranty, or a
      default (following notice and the opportunity to cure provided for in such
      document) under or misrepresentation contained in any other agreement, document
      or certificate of Borrower or any Guarantor executed or delivered in connection
      with the Loan (collectively, the “Loan
      Documents”).

     

    By
      its
      acceptance of Lender’s funds and execution of this Note, Borrower acknowledges,
      agrees and confirms that it has no defense, offset or counterclaim for any
      occurrence in relation to this Loan and Borrower acknowledges that Lender has
      complied with all of its obligations under the Loan Documents as of the date
      hereof.

     

    All
      payments of principal and interest hereunder are payable in lawful money of
      the
      United States of America and shall be made by wire transfer to the account
      of
      Agent or KF Holdings SPV, LLC, as instructed, at Valley National Bank, pursuant
      to wiring instructions to be provided to Borrower at Closing or to such other
      accounts as may be instructed by Agent.

     

    Borrower
      is hereby prohibited from exercising against Lender (as a group) or Agent,
      any
      right or remedy which it might otherwise be entitled to exercise against any
      one
      or more (but less than all) of the parties constituting Lender, including,
      without limitation, any right of setoff or any defense. Any other claim that
      Borrower may have, arising from or related to the transaction evidenced by
      this
      Note and the other Loan Documents shall be asserted only against the Agent
      and
      not against any of the individual parties constituting Lender.

     

    This
      Note
      shall be binding on the parties hereto and their respective heirs, legal
      representatives, executors, successors and assigns.

     

    This
      Note
      shall be construed without any regard to any presumption or rule requiring
      construction against the party causing such instrument or any portion thereof
      to
      be drafted.

     

    This
      Note
      shall be governed by the laws of the State of New Jersey without regard to
      choice of law consideration. Borrower hereby irrevocably consents to the
      jurisdiction of the courts of the State of New Jersey and of any federal court
      located in such State in connection with any action or proceeding arising out
      of
      or relating to this Note or the other
      Loan Documents. Borrower and Guarantor hereby designate The Corporation Trust
      Company, located at 820 Bear Tavern Road, West Trenton, New Jersey 08628, as
      their duly appointed agent to accept service of process within the State of
      New
      Jersey on their behalf.

     

    


    
      
        
          


           

          
          

        

        
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    This
      Note
      may not be changed or terminated orally.

     

    A
      determination that any portion of this Note is unenforceable or invalid shall
      not affect the enforceability or validity of any other provision, and any
      determination that the application of any provision of this Note to any person
      or circumstance is illegal or unenforceable shall not affect the enforceability
      or validity of such provision to the extent legally permissible and otherwise
      as
      it may apply to other persons or circumstances.

     

    Borrower
      understands and agrees that the Loan is and will be cross-collateralized with
      that certain loan dated
      as
      of April 20, 2007 in
      the
      amount of Twenty
      Four Million Nine Hundred Thousand ($24,900,000) Dollars by and between Costa
      Blanca II Real Estate, LLC, Costa Blanca III Real Estate, LLC, TDS Town Homes
      (Phase 1), LLC, TDS Town Homes (Phase 2), LLC and Lender, as Agent (the
“Costa
      II Loan”).
      It is
      understood and agreed that a default (beyond any applicable grace periods)
      under
      the terms and conditions of (i) that certain Loan and Security Agreement dated
      as of April 20, 2007, between Costa
      Blanca II Real Estate, LLC, Costa Blanca III Real Estate, LLC, TDS Town Homes
      (Phase 1), LLC, TDS Town Homes (Phase 2), LLC and Lender, as Agent, as amended
      by that certain First Amendment to Loan and Security Agreement and Other Loan
      Documents of even date herewith, and/or (ii) any other document or agreement
      given or delivered to Lender in connection therewith, including without
      limitation that certain (a) Amended and Restated Promissory Note in the original
      principal amount of Twenty Four Million Nine Hundred Thousand ($24,900,000)
      Dollars of even date herewith, and (b) and that certain Mortgage and Security
      Agreement, as amended by that certain First Amendment to Mortgage and Security
      Agreement of even date herewith, filed in the County of Polk, State of Florida
      which was given as security for the repayment of said Promissory Note (the
      “Costa
      II Loan Documents”)
      will
      also constitute a default under the terms and conditions of the Loan and will
      entitle Lender to all rights and remedies available to Lender under the Costa
      II
      Loan Documents. It is further understood and agreed that in the event Borrower
      defaults (beyond any applicable grace periods) upon the terms and conditions
      of
      the Loan or any of the Loan Documents executed or delivered in connection with
      the Loan, Lender shall have the right to declare the Costa II Loan in default
      and accelerate same and avail itself of any rights and remedies thereunder.
      Borrower shall execute any and all documents necessary to effectuate such
      cross-collateralization.

     

    


    
      
        
          


           

          
          

        

        
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      JURY
        TRIAL WAIVER. BORROWER AGREES THAT ANY SUIT, ACTION OR PROCEEDING, WHETHER
        CLAIM
        OR COUNTERCLAIM, BROUGHT BY BORROWER OR THE HOLDER OF THIS NOTE ON OR WITH
        RESPECT TO THIS NOTE OR ANY OTHER LOAN DOCUMENT OR THE DEALINGS
        OF THE PARTIES WITH RESPECT HERETO OR THERETO, SHALL BE TRIED ONLY BY A COURT
        AND NOT BY A JURY. BORROWER AND LENDER EACH HEREBY KNOWINGLY, VOLUNTARILY
        AND
        INTENTIONALLY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY SUCH SUIT, ACTION
        OR
        PROCEEDING. BORROWER ACKNOWLEDGES AND AGREES THAT AS OF THE DATE HEREOF THERE
        ARE NO DEFENSES OR OFFSETS TO ANY AMOUNTS DUE IN CONNECTION WITH THE LOAN.
        FURTHER, BORROWER WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER, IN ANY
        SUCH
        SUIT, ACTION OR PROCEEDING, ANY SPECIAL, EXEMPLARY, PUNITIVE, CONSEQUENTIAL
        OR
        OTHER DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES. BORROWER
        ACKNOWLEDGES AND AGREES THAT THIS PARAGRAPH IS A SPECIFIC AND MATERIAL ASPECT
        OF
        THIS NOTE AND THAT LENDER WOULD NOT EXTEND CREDIT TO BORROWER IF THE WAIVERS
        SET
        FORTH IN THIS PARAGRAPH WERE NOT A PART OF THIS NOTE.

       

       

       

    

     

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    IN
      WITNESS WHEREOF, the undersigned has executed this Note on the date set forth
      above.

     

    
      	
              WITNESS:

               

               

               

               

               

               

               

               

               

              /s/
                Jason Williams

              Name:
                Jason Williams

            	
              BORROWER:

               

              COSTA
                BLANCA I REAL ESTATE, LLC,
                a
                Florida limited liability company

               

              By:
                Tierra del Sol Resort (Phase 1), Ltd., a Florida limited partnership,
                its
                manager

               

              By:
                TDS Management, LLC, a Florida limited liability company, its general
                partner

               

               

               

              By:
                /s/ Malcolm J. Wright

              Name:
                Malcolm J. Wright

              Title:
                Manager

               

            


    

    


     

    
      	
              STATE
                OF FLORIDA

            	
              )

            
	
            	
              )
                ss.:

            
	
              COUNTY
                OF ORANGE

            	
              )

            


    

     

    I
      certify
      that on June 20th, 2007, Malcolm J. Wright came before me in person and
      stated to my satisfaction that he/she:

     

    (a)
       made
      the
      attached instrument; and

     

    (b)
       was
      authorized to and did execute this instrument on behalf of and as Manager of
      TDS
      MANAGEMENT, LLC, a Florida limited liability company, the General Partner of
      TIERRA DEL SOL RESORT (PHASE 1), LTD., a Florida limited partnership, the
      Manager of COSTA BLANCA I REAL ESTATE, LLC, a Florida limited liability company
      (the “Company”), the entity named in this instrument, as the free act and deed
      of the Company, by virtue of the authority granted by its operating agreement
      and its members.

     

     

    /s/
      J.K. Hudson

    NOTARY
      PUBLIC

    #DD459074

    


    


    


    
      
        
          
            


             

          

          
          

        

        
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    SCHEDULE
      A

     

    LENDERS

     

     

     

     

     

     

     

     

     

     

     

     

     

    
      
        
        

      

      
        A-1