ex4_24.htm


    
      

    

    Exhibit
      4.24

    PROMISSORY
      NOTE

    June
      28, 2006

    


    


    
      	
              U.S.
                $150,000

            	
              Scottsdale,
                Arizona

            


    

    


    For
      consideration received, the receipt
      and sufficiency of which is hereby acknowledged, the undersigned, Baywood
      International, Inc. (hereinafter “Borrower”), promises to pay to Ira J. Gaines
      (hereinafter “Lender”), at the location here below set forth, the principal sum
      of One Hundred Fifty Thousand and 00/100 U.S. Dollars (U.S. $150,000), with
      interest on the outstanding unpaid principal balance as hereinafter set
      forth.  Borrower’s execution of this Promissory Note (the “Note”)
      shall evidence Borrower’s receipt on the date hereinabove set forth of funds in
      the foregoing amount.

    


    1.           Maturity.  The
      maturity date (“Maturity Date”) of this Note shall be December 28,
      2006.

    


    2.           Interest.  In
      addition to the principal sum of this Note, Borrower promises to pay Lender
      basic interest.  The basic interest rate (the “Contract Rate”) shall
      be thirty percent (30%) per annum and shall be payable monthly on any
      outstanding unpaid principal balance so that Lender shall have received the
      entire principal and interest (principal and interest) on or before Maturity
      Date.  If prepaid early, all accrued interest through date of
      prepayment shall be due and payable to Lender.  Should it be necessary
      to calculate interest for a partial month, such amount shall be calculated
      by
      dividing a full month’s interest by the total number of days in that particular
      month and then multiplying the resulting daily interest amount by the number
      of
      days in that particular month that interest has accrued.

    


    3.           Payment.  The
      entire unpaid balance of principal owing on this Note and accrued and unpaid
      interest thereon shall be due and payable in full on or before Maturity
      Date.

    


    4.           Manner
      and Place of Payments.  Unless notified otherwise, Borrower shall
      make all payments due under this Note to Lender via regular U.S. mail to the
      following address:

    


    Ira
      J.
      Gaines

    3116
      East
      Shea Blvd., #191

    Phoenix,
      AZ  85028

    


    5.           U.S.
      Dollars.  All payments shall be in U.S. Dollars and be made via
      check drawn on a U.S. bank.

    


    6.           Prepayment
      Privilege.  Borrower shall have the privilege to prepay and Lender
      shall have an obligation to accept tendered prepayments of all of the principal
      balance of this Note together with the accrued interest with no
      penalties.

    


    7.           Event
      of Default.  Should Borrower fail to pay the principal sum due
      hereunder by Maturity Date or make the monthly interest payments as required,
      Borrower shall have five (5) days by which to cure such default.  If
      such default is not cured within five days, Lender shall give notice to Borrower
      of such default via facsimile or regular mail.  Unless notified
      otherwise, Lender shall send any notices to Borrower via facsimile or U.S.
      mail
      to the following address:

    


    Baywood
      International, Inc.

    Attn:  Neil
      Reithinger

    14950
      North 83rd
      Place, Suite 1

    Scottsdale,
      AZ  85260

    Fax:  (480)
      483-2168

    


    8.           Equity
      Kicker.  As additional interest to Lender under this Note,
      Borrower agrees to issue and Lender agrees to accept a warrant for One Hundred
      Twenty Thousand (120,000) common shares of the Borrower at an exercise price
      of
      $0.02.  The warrant agreement is attached to this Note as Exhibit
      A.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    9.           Lender’s
      Rights Cumulative.  The rights and remedies of Lender as provided
      in this Note and/or under applicable law shall be pursued singly, successively,
      or together against Borrower and property of security held by Lender for the
      payment hereof or otherwise at the sole, absolute and unfettered discretion
      of
      Lender, subject to any limitations imposed by applicable law.  The
      failure to exercise any such right or remedy shall in no event be construed
      as a
      waiver or release of said rights or remedies or of the right to exercise them
      at
      any later time.

    


    10.           Consents
      and Waiver of Defenses.  Except as otherwise provided herein,
      Borrower, endorsers, guarantors, sureties, accommodation parties, assuming
      parties hereof, and all other persons liable or to become liable for all or
      any
      part of this indebtedness, jointly and severally waive all applicable exemption
      rights, whether under the state constitution, homestead laws or otherwise,
      and
      also jointly and severally waive diligence, presentment, protest and demand,
      and
      also notice of protest, of demand, of nonpayment, of dishonor and of maturity
      and also recourse to suretyship defenses generally, marshaling of assets,
      laches, estoppels and equitable defenses generally; and they also jointly and
      severally hereby consent to any and all renewals, extensions or modifications
      of
      the terms hereof, including time of payment, and further agree that any such
      renewal, extension or modification of the terms hereof, or the release or
      substitution of any security for the indebtedness evidenced hereby or any other
      indulgences agreed upon by Borrower shall not affect the liability of any of
      said parties for the indebtedness evidenced by this Note.  Any such
      modifications agreed upon by Borrower and Lender may be made without notice
      to
      any said parties.  All said parties hereby specifically consent to any
      future action whereby with Borrower’s and Lender’s consent:

    


    (a)           This
      Note may from time-to-time be extended or renewed or its terms (including the
      terms of payment of principal or interest or both or any part thereof) otherwise
      modified;

    


    (b)           Any
      of the provisions of this Note may be amended or any requirement hereof or
      default hereunder waived or any departure there from consented to or any other
      forbearance or indulgence exercised with respect hereto; and

    


    11.           Fees
      and Expenses.  Borrower, indemnitors, endorsers, guarantors,
      sureties, accommodation parties, assuming parties hereof and all persons liable
      or to become liable on this Note, agree jointly and severally, to pay or
      reimburse Lender for, as the case may be, all costs of collection, including
      attorneys’ fees and all costs of suit, in the event that the unpaid principal
      sum of this Note, or any payment of interest or principal and interest thereon,
      late charge or premium, is not paid when due, or in the event that it becomes
      necessary to protect any security for the indebtedness evidenced hereby, or
      for
      the foreclosure or other enforcement by Lender or on behalf of Lender of any
      lien or document providing such security, or in the event that Lender is made
      party to any litigation because of the existence of the indebtedness evidenced
      by this Note, or because of the existence of any security, whether suit be
      brought or not, and whether through courts of original jurisdiction, as well
      as
      courts of appellate jurisdiction, or through a Bankruptcy Court or other legal
      proceedings.

    


    12.           Amendment
      and Modification.  This Note may not be amended, modified or
      changed, nor shall any waiver of any provision hereof be effective, except
      only
      by an instrument in writing and signed by the party against whom enforcement
      of
      any waiver, amendment, change, modification or discharge is sought; provided,
      however, that this paragraph shall in no way be a limitation on the provisions
      of the consents and waivers set forth in Paragraph 10 hereof.

    


    13.           Interest
      Not to Exceed Legal Maximum.  Notwithstanding any provision herein
      or in any instrument now or hereafter securing this Note, the total liability
      for payments in the nature of interest shall not exceed the limits imposed
      by
      the usury laws of the State of Arizona.  If Lender receives as
      interest an amount which would exceed such limits, such amount which would
      be
      excessive interest shall be applied to the reduction of the unpaid principal
      balance and not to the payment of interest; and if a surplus remains after
      full
      payment of principal and lawful interest, the surplus shall be remitted to
      Borrower by Lender, and Borrower hereby agrees to accept such
      remittance.  If the preceding sentence becomes operative, the total
      unpaid principal balance of this Note, if any, shall bear interest at the
      maximum rate then permitted by the usury laws of the State of Arizona until
      all
      the then obligations of this Note, as modified by this paragraph, are paid
      and
      performed in full.  Lender and Borrower agree that the rate stated in
      this Agreement does not exceed legal maximum.


    
      
        
        

      

      
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    14.           Additional
      Sums.  All fees (including origination fees), points, charges,
      goods, things in action or any other sums or things of value (collectively,
      the
“Additional Sums”) paid by Borrower to Lender, whether pursuant to this Note or
      otherwise howsoever with respect to the indebtedness evidenced hereby, or with
      respect to any other document or agreement securing this Note, which, under
      the
      law of the State of Arizona, are deemed to be interest with respect to this
      Note
      or such indebtedness, shall, for the purpose of any laws of the State of Arizona
      which may limit the maximum rate of interest to be charged with respect to
      this
      Note or such indebtedness, be payable by Borrower as, and shall be deemed to
      be,
      additional interest, and for such purposes only, the agreed upon and contracted
      rate of interest described above shall be deemed to be increased by the
      Additional Sums.

    


    15.           Successors
      and Assigns.  Whenever used herein, the words “Borrower” and
“Lender” shall be deemed to include their respective heirs, personal
      representatives, successors and assigns.  This paragraph shall not be
      construed as Lender’s consent to Borrower’s assignment or transfer of any
      property securing payment hereof or any rights, powers, obligations or duties
      of
      Borrower.

    


    16.           Governing
      Law.  Except where preempted by the laws of the United States, or
      regulations promulgated there under, this Note shall be interpreted and
      construed in accordance with and be governed by the substantive laws of the
      State of Arizona.

    


    17.           Notices.  All
      notices or other communications required or permitted to be given or delivered
      under this Note shall be in writing and shall be delivered (a) by hand in
      exchange for a receipt, (b) by facsimile or (c) by certified or registered
      mail,
      return receipt requested, postage prepaid, and addressed or delivered to the
      respective addresses as herein provided.

    


    18.           Attorneys
      Fees.  Notwithstanding any provision hereof to the contrary, if
      any dispute arising under the terms of this Note shall result in litigation,
      the
      prevailing party shall, in addition to any other relief to which it is entitled,
      be entitled to an award of its reasonable attorneys’ fees as determined by the
      court, together with an award of all of its costs of litigation.

    


    19.           Controlling
      Agreement.  This Note embodies the entire agreement and
      understanding between the Borrower and Lender with respect to the repayment
      of
      the indebtedness evidenced hereby.  In the event of a conflict between
      the terms of this Note and the terms of any other documents, the terms of this
      Note shall control.

    


    20.           Severability.  If
      any provision of this Note or the application thereof to any person or
      circumstances shall be held invalid or unenforceable by any court or other
      governmental authority to any extent, the remainder of this Note and the
      application of such provisions to other persons or circumstances shall not
      be
      affected thereby and shall remain enforceable.

    


    21.           Borrower’s
      Representations.  The Borrower is duly
      incorporated.  The person executing this Note is duly authorized to do
      so on behalf of the Borrower and represents that this Note does not cause
      default of any of its existing agreements or covenants.

    


    DATED
      as
      of the day first hereinabove set forth.

    


    
      	
              BORROWER:

            	 	
              LENDER:

            	 
	 	 	 	 
	
              BAYWOOD
                INTERNATIONAL, INC.

            	 	
              IRA
                J. GAINES

            	 
	 	 	 	 
	
              A
                Nevada Corporation

            	 	 	 
	 	 	 	 	 
	
              By:

            	
               

            	 	
              By:

            	
               

            	 
	 	 	 	 	 
	
              Its:

            	
               

            	 	
              Date:

            	
               

            	 
	 	 	 	 	 
	
              Date:

            	
               

            	 	 	 


    

    



    
      
        
        

      

      
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    “EXHIBIT
      A”

     

     

     

    
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