Lilac Advisors, LLC 150 East 58th Street
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Lilac
Advisors, LLC
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000
Xxxx 00xx
Xxxxxx
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00xx
Xxxxx
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Xxx
Xxxx, XX 00000
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April
24th,
2008
Xx.
Xxxxxx Xxxxxxxxxxxxxx
Xxxxxxxx
International Ltd.
Xxxx
Xxxxx
0-0
Xxxx
Xxxxxx
Xxxxxxxxx
Xxxxxx
GU2 4A W
United
Kingdom
Dear
Harmen,
This
letter (this “Agreement”) constitutes the agreement between Octavian
International Ltd. (the “Company”) and Lilac Advisors, LLC (“Lilac”) regarding a
potential transaction by the Company. The Company hereby grants Lilac a right
of
first offer with respect to any acquisition, sale of assets, consolidation,
or
merger by the Company (a “Merger”) with or into a public company (a “Shell”).
Pursuant to such right of first offer, the Company and Lilac will use their
respective reasonable best efforts to cause the Company to consummate a Merger
with or into Spectre Gaming, Inc., a Minnesota corporation (“Spectre”). In the
event that after using such reasonable best efforts, the parties conclude that
such a transaction with Spectre will not be in the Company’s best interests,
then the Company shall have the right to merge with or into a public company
other than Spectre. The Company agrees that in the event that a Merger with
or
into Spectre or any other company, is consummated, and CIBC Xxxxxxxxxxx &
Co., Xxxxxx Xxxxx Capital LLC, or any other financial intermediary introduced
to
the Company by Lilac or by Xxxxx Xxxx (any of such intermediaries referred
to as
a “Lilac Banker”) is entitled to any fees in connection with such transaction,
Lilac, or its designee, shall have an ownership interest in in the resulting
merged company (“Newco”) on a fully diluted basis equal to the lesser of (i) 13%
or (ii) the percentage obtained by dividing $2,400,000 by the pre-money value
ascribed to Newco at the time of its first post-Merger financing. The parties
presently intend for Newco to raise capital via a “PIPE” financing concurrently
with or soon after the Merger.
The
Company further agrees that in the event that the Company does not undertake
the
transaction contemplated by the preceding paragraph, but instead within 9 months
of the date hereof, the Company, or any successor, affiliate or its parent
company, consummates any other type of transaction or series of transactions
(“Alternate Transactions”), including but not limited to any mergers or
acquisitions, licensing transactions with substantial upfront or near term.
payments, and any debt or equity financings via the public or private markets,
then Lilac shall be entitled to a fee in the amount of 2.5% of the gross
proceeds (cash or otherwise) to the Company, from such Alternate Transactions,
but if and only if any Lilac Banker is entitled to any fees in connection with
such Alternate Transactions,.
The
Company further agrees that in the event it consummates a financing during
the
next four months and prior to the aforementioned PIPE transaction, it shall
allocate not less than $250,000 to Lilac for purposes of (i) satisfying any
remaining liabilities of Spectre other than Spectre’s senior debt obligations or
(ii) acquiring a “clean” shell in which to merge the Company. The Company shall
have the right to approve the use of any amounts so allocated to Lilac, such
approval not to be unreasonably withheld or delayed.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of New York applicable to agreements made and to be fully performed
therein. Any disputes which arise under this Agreement, even after the
termination of this Agreement, will be heard only in the state or federal courts
located in the City of New York, State of New York. The parties hereto expressly
agree to submit themselves to the jurisdiction of the foregoing courts in the
City of New York, State of New York.
*************************************
In
acknowledgment that the foregoing correctly sets forth the understanding reached
by Lilac and the Company, please sign in the space provided below, whereupon
this letter shall constitute a binding Agreement as of tile date indicated
above.
Very
truly yours,
Lilac
Advisors, LLC
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By:
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/s/
Xxxxx Daily
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Name:
Xxxxx Daily
Title:
Manager Partner
Accepted
and Agreed
Octavian
International Ltd.
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By:
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/s/
Xxxxxx Xxxxxxxxxxxxxx
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Name:
Xxxxxx Xxxxxxxxxxxxxx
Title:
