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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






