PLACEMENT FEE AGREEMENT

 

                                                                   Exhibit 10.28

 

                             PLACEMENT FEE AGREEMENT

 

 

     THIS  PLACEMENT  FEE AGREEMENT  ("Agreement")  is made on September 1, 2005

("Effective  Date")  irrespective  of the date of  signing,  by and  between PDS

GAMING CORPORATION a Minnesota corporation ("PDS"),  whose address is 6280 Annie

Oakley  Drive,  Las  Vegas,  NV 89120,  and  ITG-VEGAS,  INC  ("ITGV")  a Nevada

corporation  and  INTERNATIONAL  THOROUGHBRED  BREEDERS,  INC ("ITB") a Delaware

corporation (ITGV and ITB are hereinafter individually and collectively referred

to as "Client" and are and hereby agree to be jointly and  severally  liable for

all obligations  created by this Agreement),  both of whom have their address at

One East 11 Street, Suite 500, Riviera Beach, Florida 33404.

 

                                    RECITALS

 

     WHEREAS,  PDS is engaged in the business of providing financial services to

the gaming industry; and

 

     WHEREAS,  Client agrees and acknowledges  that but for the services of PDS,

Client would not have completed a $29.3 million material recapitalization of the

Client's   company   debt   (herein   referred  to  as  the  "PDS   Indebtedness

transaction"); and

 

     WHEREAS,  Client determined that the involvement of PDS was critical to the

consummation  of  the  PDS  Indebtedness  transaction  and to  future  financial

transactions that may be contemplated by Client; and

 

     WHEREAS,  Client  agrees that PDS  dedicated  significant  resources to the

efforts to complete the PDS Indebtedness transaction; and

 

     WHEREAS,  Client had previously  agreed to compensate PDS for its work with

regard to the PDS Indebtedness  transaction and this Agreement memorializes said

agreement as requested by Client;

 

     NOW, THEREFORE, IN CONSIDERATION of the mutual covenants and conditions set

forth  herein and other good and valuable  consideration,  the  sufficiency  and

adequacy  of which is  hereby  acknowledged  by the  parties,  it is  agreed  as

follows:

 

1)   Placement  Fee:  As a  result  of  the  closing  of  the  PDS  Indebtedness

     transaction  on June 30,  2005,  for  services  rendered  by PDS to Client,

     Client,  and  each of  them  jointly  and  severally,  agrees  to pay PDS a

     placement  fee  equal  to  $750,000.00  ("Placement  Fee")  which  shall be

     considered  completely  earned and due as of the Effective Date and will be

     in  addition  to any  other  fees  that  may be  due  to PDS or  have  been

     previously  paid to PDS with  regard to the PDS  Indebtedness  transaction.

     Client agrees to pay the Placement Fee in the following manner:

 

     a)   Upon the  Effective  Date of this  Agreement,  Client  has paid to PDS

          $50,000.00  which will be applied to the Placement Fee of  $750,000.00

          and reduce the unpaid balance of the Placement Fee to $700,000.00.

     b)   No  additional  payments of the  Placement Fee to PDS will be required

          until March 1, 2006.

     c)   The unpaid balance of the Placement Fee shall not bear any interest.

     d)   On March 1, 2006, and on the first day of each month  thereafter up to

          and  including  February  1,  2007,  Client  will  pay to PDS  monthly

          payments of $58,333.33.  In the event the payments are not received by

          PDS on the first day of the  month  when due and  within a 10 day cure

          period,  then the  unpaid  balance  of the  Placement  Fee shall  bear

          interest  at a rate of  fifteen  percent  (15%)  per  annum  ("Default

          Interest")  beginning  on the  first  day of the  month in  which  the

          monthly  payment of  $58,333.33  is not paid by Client and received by

          PDS and shall continue  until the day the default has been cured.  Any

          accrued Default  Interest shall be due and payable on the first day of

          the month when the next month's payment is due.

     e)   In the event of default under this Agreement, PDS shall have the right

          after  satisfaction  in full  under the loan  agreement  to offset any

          unpaid amount of the  Placement Fee against any other assets,  cash or

          collateral held by PDS for the benefit of Client or in which PDS has a

          perfected  security  interest,  whether said security interest is as a

          part of this Agreement or any and all other agreements between PDS and

          Client.

     f)   In the event that Client  refinances  fifty  percent or mor of the PDS

          Indebtedness transaction, then the entire Placement Fee, including any

          accrued Default Interest,  will be due in full and payable immediately

          upon the  closing and  funding of the  refinancing.  If payment is not

          made at the time of the closing and funding of the  refinancing,  then

          it shall be considered an event of default.

 

2)   Placement Fee Agreement  Collateral:  Client agrees to ensure and take such

     steps as are  necessary to provide that PDS will have a secondary  security

     interest in the  proceeds  of the  Realen-Turnberry/Cherry  Hill,  LLC Note

     dated  November  29,  2000  ("Turnberry  Note")  remaining,  if any,  after

     satisfaction  in full of the  loan  agreement  or  release  of the  note as

     security  for the loan  under the loan  agreement.  Client may from time to

     time  substitute the collateral with  collateral  reasonably  acceptable to

     PDS. Such collateral  substitution  will be valued at an amount equal to or

     greater than the  outstanding  balance due for the payment of the remainder

     of the Placement Fee plus accrued but unpaid interest then due or to become

     due pursuant to the terms of this Agreement.

 

3)   Breach and Default. Client shall be deemed in breach of this Agreement upon