Exhibit
10.1


 


            $6,000,000.00
U.S.


 


	
   

  	
   

  	
  Jefferson County, Colorado

  
	
   

  	
   

  	
  Date:
  December 4th, 2007

  



 


 


THIS IS
A BALLOON NOTE AND THE
FINAL PRINCIPAL PAYMENT OR THE PRINCIPAL BALANCE DUE UPON MATURITY IS
$6,000,000.00 U.S. TOGETHER WITH ACCRUED INTEREST AND ALL ADVANCEMENTS.


 


 


BALLOON  PROMISSORY  NOTE


 


For
value received, the undersigned, VCG HOLDING
CORP., a Colorado corporation, with an address of 390 UNION BLVD., SUITE 540, LAKEWOOD, CO 80228   (herein “Maker” or “Makers”), hereby
promises to pay to the order of SUNSHINE MORTGAGE
INVESTORS, INC., whose
address is  780 N.E. 69TH STREET,
APT. 2209, MIAMI, FL 33138, (hereinafter referred to along
with each subsequent holder or holders of this Promissory Note, as “Holder”),
the principal sum of SIX MILLION AND NO/100
DOLLARS ($6,000,000.00
U.S.), with interest thereon from the date or dates of disbursement
of the aforesaid principal sum, to be paid in lawful money of the United States
of America, which shall be legal tender in payment of all debts and dues,
public and private, at the time of payment.


 


Interest
shall accrue to the outstanding principal balance of this Promissory Note (“Note”)
at a rate equal to FOURTEEN percent (14.0%) per annum.
Interest shall be computed on the basis of actual number of days per year for
the actual number of days outstanding.


 


Interest
only shall be payable on the 5th  day of each month commencing on the 5th day of JANUARY, 2008, and
continuing on the  5th day of each month thereafter until maturity.


 


Principal and all remaining accrued interest shall be due and payable
on the         day of DECEMBER, 2008 (the “Maturity Date”).


 


The payment of this Note is secured by Escrow and Pledge Agreements,
and Deeds of Trust and Mortgages from Guarantors of this Note encumbering SIX (6) parcels of real property, recorded
or to be recorded in the Public Records of Jefferson County,
Kentucky, Arapahoe County, Colorado, Denver County, Colorado, St. Clair County,
Illinois, Tarrant County, Texas and Maricopa County, Arizona, and
common stock of the Borrower, and Kenja II, Inc., a Florida corporation,
together with such other instruments now or hereafter executed by Maker in
favor of Holder, or contemplated to be executed by Maker in favor of Holder in
connection with the loan evidenced by this Note (“Security Documents”). Any
default by Maker under the terms and conditions of the Security Documents shall
constitute a default hereunder.


 


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In
the event that title searches of the aforesaid properties reveal liens
undisclosed to Holder on the Real Estate Schedule previously delivered by
Maker, the Maker shall pay down an amount equivalent to said additional liens
within thirty (30) days of receipt of the title search(es), failure of which
shall constitute a default hereunder.


 


Payments
received under this Note shall be applied (a) first to late charges and sums
due and payable under this Note and the Security Documents other than principal
or interest such order as Holders may determine; (b) second, to accrued and
unpaid interest; and (c) third, to principal.


 


I
will make my monthly payments as follows: U.S.
$70,000.00  to SUNSHINE MORTGAGE
INVESTORS, INC., whose
address is 780 N.E. 69TH STREET, APT. 2209, MIAMI, FL 33138.


 


If
(a) Maker fails to pay, in full, in good cleared funds, within five (5) days of
when due, any installments of principal, interest or any other sums payable
under this Note; (b) Maker fails to otherwise strictly perform, comply with and
abide by all Maker’s other agreements and covenants in this Note; or (c) Maker
defaults in the performance of its obligations, covenants or agreements under
the Security Documents, then the entire principal sum outstanding and all
accrued interest shall at once become due and payable, without notice, at the
option of the Holder of this note. Failure to exercise this option shall not
constitute a waiver of the right to exercise the same at any other time. The
principal of this Note, and any part thereof, and all accrued interest, if any,
shall bear interest at the maximum legal rate of interest chargeable under
applicable law after maturity or default until paid. In the event there is no
maximum rate applicable or in the event such maximum rate is otherwise
indeterminable, it is agreed that such rate shall be eighteen percent (18%) per
annum. All parties liable for the payment of this Note agree to pay Holders
hereof reasonable attorneys’ fees (including appeals) for the services of
counsel employed after maturity or default to collect this Note, or to protect
or enforce the security hereto, whether or not suit is brought.


 


If
Maker fails to pay any installment of principal or interest or any other sum
payable under this Note within five (5) days of when the same is due, then the
Holder shall be entitled to collect a “Late Charge” in the amount of $500.00 to
cover the reasonably anticipated additional costs of handling late payments.
Acceptance of any Late Charge shall not constitute a waiver of any default and
shall not prevent Holder from exercising any other rights of Holder under this
Note or the Security Documents.


 


I
have the right to make payments of principal at any time before they are due. A
payment of principal only is known as a “prepayment.” When I make a prepayment,
I will tell the Note Holders in writing that I am doing so. I may make a full
prepayment or partial prepayments without paying any prepayment charge. The
Note Holder will use all of my prepayments to reduce the amount of principal
that I owe under this Note. If I make a partial prepayment, there will be no
changes in the due date or in the amount of my monthly interest payment unless
the Note Holder agrees in writing to those changes.


 


Nothing
herein contained, nor any transaction related hereto, shall be construed or so 


 


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operate to require Makers or
any other person liable for repayment of same, to pay interest at a greater
rate than is lawful in such case to contract for, or to make any payment, or to
do any act contrary to law. Should any interest or other charges paid in
connection with the loan evidenced by this Note by Maker or any parties liable
for the payment of this Note result in the computation or earning of interest
in excess of the maximum rate of interest which is legally permitted under the
laws of the State of Florida, then any and all excess shall be and the same is
hereby waived as interest by Holder hereof, and any and all such excess paid
shall be automatically credited first against and in reduction of the principal
balance due under this Note or, at the option of Maker, paid by Holder to the
Maker or any parties liable for the payment of this Note.


 


If
any clause or provision herein contained shall be unenforceable under
applicable law, in whole or in part, then such clause or provision or part
thereof shall only be inoperative as though not contained herein and the
remainder of this Note shall remain operative and in full force and effect.


 


The
remedies of Holder, as provided herein and in the Security Documents, shall be
cumulative and concurrent and may be pursued singularly, successively, or
together at the sole discretion of Holders and may be exercised as often as
occasion therefore shall arise. No act of omission or commission of Holders,
including specifically any failure to exercise any right, remedy or recourse
shall be effective unless it is set forth in a written document executed by
Holders and then only to the extent specifically recited therein. A waiver or
release with reference to one event shall not be construed as a bar to or as a
waiver or release of any subsequent right, remedy, or recourse as to any
subsequent event.


 


Makers
and all sureties, endorsers and guarantors of this Note hereby (a) waive
demand, presentment for payment, notice of nonpayment, protest, notice of
protest, and all other notices, filing of suit, and diligence in collecting
this Note, in enforcing any of the security rights or in proceeding against any
of the property covered by the Security Documents; (b) agree that Holder shall
not be required first to institute any suit or to exhaust his, their or its
remedies against Maker or any other person or party to become liable hereunder
or against the mortgaged property in order to endorse payment of this Note; (c)
consent to any extension, rearrangement, renewal, or postponement of time of
payment of this Note and to any other indulgence with respect thereto without
notice, consent or consideration to any of them; and (d) agree that,
notwithstanding the occurrence of any of the foregoing (except the express
written release by Holder of any such person), they shall be and remain jointly
and severally, directly, and primarily liable for all sums due under this Note,
and the other Security Documents.


 


In
the event of any sale, transfer, conveyance or encumbrance of the property
encumbered by the Security Documents securing this Note or any interest
therein, or the sale, conveyance or pledge of any interest of Maker to any
other entity, individual, firm, partnership or corporation, the entire principal
indebtedness hereunder, together with any and all interest accrued thereon,
shall become due and payable immediately.


 


Whenever
used in this Note, the singular number shall include the plural, the plural,
the singular, and the masculine shall include the feminine and the neuter, and
the words “Maker”, “Co-Maker” and “Holder” shall be deemed to include Maker,
Co-Maker and Holder named in the opening paragraph of this Note and their
respective successors and assigns, if any. It is 


 


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expressly understood and
agreed that Holder shall never be construed for any purpose as a partner, joint
venturer, co-principal, or associate of Maker, Co-Maker, or of any person or
party claiming by, through, or under Maker or Co-Maker in the conduct of their
respective businesses.


 


This
Note is executed and delivered in the State of Florida and shall be construed
by and enforced in accordance with the laws of the State of Florida.


 


MAKER AND HOLDER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVE THE RIGHT EITHER MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY LITIGATION
BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE, THE
MORTGAGE, THE COMMITMENT OR ANY OF THE OTHER SECURITY DOCUMENTS, OR ANY COURSE
OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR
ACTIONS OF EITHER PARTY. THIS PROVISION IS A MATERIAL INDUCEMENTFOR THE HOLDER
EXTENDING CREDIT TO MAKER.


 


THIS IS
A BALLOON NOTE SECURED BY SECURITY DOCUMENTS AND THE
FINAL PRINCIPAL PAYMENT OR THE PRINCIPAL BALANCE DUE UPON MATURITY IS
$6,000,000.00 TOGETHER WITH ACCRUED INTEREST AND ALL ADVANCEMENTS.


 


 


[INTENTIONALLY LEFT BLANK]


 


[SIGNATURE PAGE FOLLOWS]


 


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IN
WITNESS WHEREOF, this Mortgage has been executed on the date first above
written.


 


	
   

  	
   

  	
  “MAKER”

  
	
  Signed, sealed and
  delivered  in the presence of:

  	
   

  	
   

  
	
   

  	
   

  	
  VCG
  HOLDING CORP., a Colorado corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/Troy
  Lowrie

  
	
     /s/ Lois
  Jean Holmes

  	
   

  	
  Name:

  	
  Troy
  Lowrie  

  
	
  Print Name:    Lois
  Jean Holmes  

  	
   

  	
  Title:

  	
  Chief
  Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
     /s/
  Nancy Zimmerman 

  	
   

  	
   

  	
   

  
	
  Print Name:    Nancy
  Zimmerman

  	
   

  	
   

  	
   

  



 


STATE OF COLORADO


COUNTY OF Jefferson


 


The foregoing instrument was
acknowledged before me this 4th day of December, 2007, by TROY LOWRIE,
as Chief Executive Officer of VCG HOLDING
CORP., a Colorado corporation, on behalf of the corporation.


 


	
   

  	
  /s/
  Mary Bowles-Cook

  
	
   

  	
  Signature
  of Notary Public

  
	
  AFFIX
  NOTARY STAMP

  	
  Mary
  Bowles-Cook

  
	
   

  	
  (Print
  Notary Name)

  
	
  (Notary
  Stamp: Mary Bowles-Cook, Notary Public,

  	
  My
  Commission Expires:

  
	
  State
  of Colorado, My Commission Expires Aug. 24, 2009)

  	
  Commission
  No.:

  
	
   

  	
  x  Personally
  known, or

  
	
   

  	
  o  Produced
  Identification

  
	
   

  	
  Type
  of Identification Produced

  



 


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