Exhibit 10.2

EXECUTION COPY

STOCK PURCHASE AGREEMENT RE:

KENKEV II F/K/A MARK R. DEAN, INC. a Maine Corporation.

THIS AGREEMENT is made on September 14, 2007, between KEN-KEV INC., a South
Carolina corporation, Ken-KEV, Inc. and the person identified on the signature
pages as “Seller Equityholder” hereinafter referred to as (the “Seller
Equityholder” and sometimes “Seller”,) and VCG HOLDING CORPORATION, a Colorado
Corporation on behalf of a Maine corporation to be formed (“Buyer”).

BACKGROUND

A.                                         Seller owns KEN-KEV, Inc. (“KEN-KEV”)
KENKEV II, Inc (“KenkevII”) a Maine corporation that operates a business
commonly known as “Platinum Plus”, located at 200 Riverside Street, Portland,
Maine (the “City”). KenkevII operates an adult entertainment business which
presents adult entertainment at its business location pursuant to a duly issued
Maine Liquor License, along with a Nude Activity License from the City (the
“Business”).

B.                                           Seller, KENKEV, Inc. a South
Carolina corporation, owns 100% of the outstanding stock in KENKEV, II Inc.

C.                                           K & R Properties, Inc., a South
Carolina Corporation and an affiliate of Seller (“Landlord”) is the sole owner
of the real property located at 200 Riverside Street, Portland Maine, which it
leases, on a completely TRIPLE net basis, to KenkevII.

D.                                          Gregory Kenwood Gaines (“Seller
Equityholder”) is the sole and only shareholder in Seller.

E.                                            Seller owns all of KenKevII’s
issued and outstanding capital stock.

F.                                            Buyer desires to purchase from
Seller, and Seller desires to sell to Buyer, all of the issued and outstanding
stock in KenKevII (the “Purchased Equity Interests” or the “Purchased Shares”)
on the terms of and subject to the conditions of this Agreement.

G.                                           The Seller Equityholder is Seller’s
chief executive officer and sole shareholder.

H.                                          VCG Holding Corporation and Buyer,
on one hand, and Seller and Seller Equityholder, on the other, have also agreed
to not compete with each other in certain geographic areas, as provided in
noncompetition agreements in the form

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agreed upon by the parties on the date of this Agreement (the “Noncompetition
Agreements”).

AGREEMENTS

NOW, THEREFORE, in consideration of the Background and the terms and conditions
set forth in this Agreement, each of the Seller, Seller Equityholder, VCG
Holding Corporation  and Buyer agree as follows:

1.                                       Agreement of Purchase and Sale of the
Purchased Equity Interests. On the terms and subject to the conditions set forth
in this Agreement, Seller agrees to sell and deliver to Buyer on the Closing
Date the Purchased Equity Interests, free from all Encumbrances (as defined in
Section 8.4), and Buyer agrees to purchase the Purchased Equity Interests from
Seller.

2.                                       Purchase Price for Purchased Equity
Interests.

2.1                                 Shares to be Purchased.  On the terms and
conditions set forth in this Agreement, the Seller hereby sells, assigns,
transfers, sets over and conveys to the Buyer on the Closing Date described
below, the Purchased Equity Interests.

2.2                                 Share Purchase Price.  On the Closing Date,
the Buyer shall pay the following purchase price in the manner set forth in
Paragraph 2.3 and 2.4 below to Seller against receipt of the certificates for
the Purchased Shares, duly endorsed for transfer or accompanied by duly executed
stock powers as follows:

FOUR MILLION FIVE HUNDRED THOUSAND ($4,500,000.00) DOLLARS) for the Purchased
Shares, together with a payment of One Million Dollars ($1,000,000) for the
right to purchase the 100% of the shares of Kenja II, Inc. a Florida corporation
which owns and operates an adult entertainment business in Hialeah, Florida (the
“Florida Business”) (hereinafter, “Option Payors.  The $1 million payment is non
refundable, but shall be applied to the purchase price owed to Seller by Buyer
for the purchase of the Florida Business as long as Buyer acquires the Florida
Business within 90 days of execution of a definitive agreement relative to the
Florida Business, or a reasonable time thereafter, provided both parties are
acting in good faith towards a closing.

In addition, Seller and Buyer shall make appropriate adjustment for operating
costs that straddle the Closing Date, such as property taxes, insurance and
utilities (the “Closing Adjustments”)

2.3                                 Payment of Purchase Price.  On the Closing
Date, the Buyer shall pay to the Seller in cash or by certified check for the
purchase of all of the issued and outstanding shares in KenKevII, and for the
Florida Business purchase option, the sum of FIVE MILLION FIVE HUNDRED THOUSAND
($5,500,000.00) DOLLARS) payable as follows:

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a.                                                                                      
$50,000.00 from escrow deposited at the time of the of the execution of the
letter of intent;

b.                                                                                     
$5,450,000.00 in immediately available funds, by wire transfer to an account
designated by Seller.

2.4                                 The allocation of the purchase price is set
forth in Exhibit 24a attached hereto [To be reviewed by Seller’s accountants and
tax lawyer] and incorporated by reference herein.  In addition, Buyer shall pay
at closing all pre-paid items set forth on Exhibit 2.3b.  In addition, Seller
shall pay to Buyer, or Buyer shall pay to Seller, as the case may be, an amount
equal to the net Closing Adjustment as defined in Article 2.2 hereinabove.

2.5                                 Transfer of License(s): Seller shall assist
Buyer in acquiring, in Buyer’s own name, all liquor licenses and permits used in
connection with the Business, as well as the Nude Activity license issued by the
City, which shall permit the Buyer to operate the Business in substantially the
same manner it is presently being operated. In the event that the Buyer is not
able to acquire the liquor license or any City issued license on or before the
Closing Date, then this Agreement shall close in Escrow, consistent with Exhibit
2.5

2.6                                 No Liabilities.  Prior to the Closing Date,
Seller shall have caused all known liabilities and obligations of Kenkev to be
satisfied, other than with respect to liabilities arising from the contracts
accepted by Buyer (the “Assumed Contracts”) and set forth on Schedule 8.17, and
with respect to such contracts only for products and services provided to Kenkev
after the Closing Date (the “Future Liabilities”).

2.7                                 Asset in Business: As of the Closing Date,
the Seller will insure that Kenkev owns all of the leases presently in
existence, along with all equipment, furniture, and fixtures, and  personal
property in substantially the same  form as they existed as of the date this
Agreement is executed.

2.8                                 Excluded Assets.  Buyer is not entitled to,
and Seller may distribute from Kenkev to the “Seller Equityholder), the
following assets of Kenkev, to the extent existing or arising out of facts
occurring before the Closing Date:  cash, cash equivalents, bank accounts,
accounts receivable, credit card processing agreements and other similar assets
relating to amounts earned before the Closing Date but subject to the “Closing
Adjustments.”

 3.                                    Related Agreements.

3.1                                 Noncompetition Agreements. At the Closing,
VCG Holding Corporation the “Buyer,”  and the Seller and the Seller
Equityholder, shall execute and deliver to each other the Noncompetition
Agreements and Confidentiality Agreement in the form attached hereto as Exhibit
3.1. The Non-Compete Agreements shall provide for the Seller Equityholder not to
compete with VCG Holding Corporation, the Buyer, for a period of 3 years and a
radius of 50 miles from Kenkev’s location and for VCG Holding

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Corporation, the Buyer not to compete with Seller or Seller Equityholder for a
period of three years in any area within 50 miles of any existing businesses of
Seller or Seller Equityholder or in which Seller Equityholder has a controlling
interest, except for Florida, a listing of all such business is attached as an
addendum to this Agreement, for which Seller and Seller Equityholder have
granted VCG a first right of refusal on the sale of such businesses as
consideration for this provision  In each case, the restrictions shall apply to
all affiliate businesses of Buyer and Seller Equityholder.   It is the intent of
the parties that neither Buyer nor Seller will operate within fifty (50) miles
of a present or future location of the other, large metropolitan areas and
Florida excluded, and which shall include the metropolitan markets with greater
then 3 million persons in terms of overall population, along with all present
locations where either party presently operates.

3.2                                 Lease. At the time of closing, Buyer and
Landlord will enter into a commercially reasonable lease, to be mutually agreed
upon by the parties for the lease of the Real Property located at 200 Riverside
Street, Portland, Maine. The minimum term of the lease shall be for a period of
at least 25 years and the lease shall provide a right of first refusal to
acquire the property should Landlord desire to sell the property or upon death
of all owners of Landlord, but a sale between the present shareholders of
Landlord to one another or among their respective heirs, will not trigger the
right of first refusal, nor shall any gifts to the heirs of such owner.

4.             Pre-closing Actions. Before the Closing:

4.1                                 Conduct of Business. Seller shall cause
Kenkev to carry on and conduct the Business only in the ordinary course
consistent with past practice, without any material change in the policies,
practices, and methods Kenkev pursued before the date of this Agreement. Seller
will use its best efforts and cause Kenkev to use its best efforts to preserve
the Business organization intact; to preserve the relationships with Kenkev’s
customers, suppliers, and others having business dealings with Kenkev; and to
preserve the services of Kenkev’s employees, agents, and representatives.
Without limitation of the foregoing, (a) Seller will cause Kenkev not to
undertake without Buyer’s prior written consent (not to be unreasonably withheld
or delayed) any action that, if taken before the date of this Agreement, would
be required to be disclosed on Schedule 8.12, and (b) Seller will cause Kenkev
not to alter the physical contents or character of any of its inventories in a
way that materially affects the nature of the Business or results in a material
change in the total dollar valuation of the inventories or otherwise take action
or refrain from taking action that would result in any material change in
Kenkev’s assets or liabilities, in each case other than in the ordinary course
of business consistent with past business practices.

4.2                                 Access to Buyer. From the date of this
Agreement through the Closing, Seller  shall cause Kenkev to permit Buyer and
its representatives to make a full business, financial, accounting, and legal
investigation of Kenkev. Seller shall cause Kenkev to take all reasonable steps
necessary to cooperate with Buyer in conducting this investigation. No such
investigation by Buyer or its representatives or any knowledge obtained or that
could have been obtained shall affect the representations and warranties of
Seller or Buyer’s reliance on them.

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4.3                                 UCC Filings. Buyer will conduct a Uniform
Commercial Code search result for the State of Maine, the County of Cumberland,
and in South Carolina showing no security interests or liens naming KenKev as a
debtor, other than those acceptable to the Buyer or released prior to or at the
time of the Closing described herein.

4.4                                 Accuracy of Representations and Warranties
and Satisfaction of Conditions. Seller will immediately advise Buyer in writing
if (a) any of the representations or warranties of Seller is untrue or incorrect
in any material respect, or (b) Seller becomes aware of the occurrence of any
event or state of facts that results in any of the representations and
warranties of Seller being untrue or incorrect as if Seller were then making
them. Seller will not take any action, or omit to take any action, and shall
cause Kenkev not to take any action, or omit to take any action, that would
result in any of Seller’s representations and warranties set forth in this
Agreement to be untrue or incorrect as of the Closing Date. Seller will use its
best efforts to cause all conditions set forth in Section 5 that are within its
control to be satisfied as promptly as practicable under the circumstances.

5.             Conditions Precedent to Buyer’s Obligations.

Buyer’s obligation to consummate the transactions contemplated by this Agreement
is subject to the fulfillment (or waiver by Buyer) before or at the Closing of
each of the following conditions:

5.1                                 Accuracy of Representations and Warranties.
The representations and warranties of Seller in Article 8, hereinafter and all
related documents shall be true and correct on the date of this Agreement and at
and as of the Closing.

5.2                                 Performance of Covenants. Seller shall have
in all respects performed and complied with all covenants, agreements, and
conditions that this Agreement requires, and with all other related documents to
be performed or complied with before or at the Closing. The Seller shall have
executed and delivered the Non-competition Agreements, the Waivers, the Forms
W-9 referred to in Section 8.22(e), and the Certificates of Non-foreign Status
referred to in Section 11.3. To the extent that any buy-sell agreements exist
between any parties relative to the shares being sold in KenkevII,  they have
been terminated.

5.3                                 Satisfactory Due Diligence Review. All due
diligence by Buyer has been completed, and Buyer has notified Seller
Equityholder in writing of the successful completion of the Due Diligence.
Seller represents that all materials provided to Buyer during the course of due
diligence are truthful and accurate, to the best of Seller’s knowledge.

5.4                                 Permits. Buyer shall have acquired all
licenses and permits that in Buyer’s opinion are necessary to operate the
Business after the Closing. These include, but are not limited to, a Liquor
License issued by the State of Maine and a Nude Activity License issued by the
City of Portland. There shall be no material change in the ability of the Buyer
to conduct business in the manner in which it is currently being operated.

5.5                                 No Casualty. Before the Closing Date, Seller
shall not have incurred, or be threatened with, a material liability or casualty
that would materially impair the value of the Business.

5.6                                 Opinion of Counsel. Buyer shall have
received the favorable opinion of counsel to Seller dated the Closing Date and
in form and substance satisfactory to Buyer’s counsel that the

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Seller is a corporation in good standing and that Seller is lawfully entitled to
sell the stock in KEN-KEV, Inc and KenkevII, Inc..

5.7                                 Equity Interest Certificates. Seller shall
have delivered to Buyer stock certificates representing all of the Purchased
Equity Interests registered in the name of the Seller (without any restrictive
legend). The certificates shall be endorsed in blank or with accompanying signed
assignments. Seller shall also deliver to Buyer such other instruments or
documents that shall, in the reasonable opinion of the Buyer’s counsel, be
reasonably required to vest good title in Buyer to the Purchased Equity
Interests free from all Encumbrances.

5.8                                 Certificates Regarding Conditions Precedent.
The Seller shall have delivered to Buyer certificates of the Seller  certifying
that as of the Closing Date all of the conditions set forth in Sections 5.1,
5.2, 5.5, 5.7, 5.10, and 5.12 have been complied with, satisfied or waived by
Buyer.

5.10                           No Litigation. No proceeding or investigation
shall have been instituted before or by any court or governmental body to
restrain or prevent the carrying out of the transactions contemplated by this
Agreement or that might affect Buyer’s right to own the Purchased Equity
Interests or for Buyer to own, operate, and control the Business after the
Closing Date.

5.11                           Lien Search. Buyer shall have obtained UCC lien
searches in form and content satisfactory to Buyer.

5.12                           Consents. Seller shall have obtained in writing
all consents necessary or desirable to consummate or facilitate consummation of
this Agreement and any related transactions. The consents shall be delivered to
Buyer before Closing and shall be reasonably acceptable to Buyer in form and
substance.

5.13                           Environmental Investigation. Buyer waives the
right to perform a environmental investigation of the property at this time,
however reserve the right to conduct such a investigation at the time that it
exercises its first right of offer to acquire the property. Nothing shall affect
the Seller’s  representations and warranties in Section 8.25 or Buyer’s reliance
on them or Seller’s indemnification obligations under Section 10 hereinafter.

5.14                           Waivers. Seller shall have delivered to Buyer a
statement from each of the Seller and each of KEN-KEV, Inc, and KenkevII’s
officers and directors, in form and substance acceptable to respective Buyer,
that each either waives or has no claim, as appropriate, against the corporation
for unpaid dividends, bonuses, profit sharing, rights, or other claims of any
kind, nature, or description except salaries and fringe benefits normally
accrued and described in the statement or otherwise contemplated under this
Agreement.

5.15                           Resignations. Each director and officer of
KEN-KEV, Inc. and KenkevII shall have delivered to Buyer resignations from their
positions.

5.16                           Other Documents and Instruments. Buyer shall have
received any other documents and instruments from Seller as it may reasonably
request.

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5.17                           Approvals by Buyer’s Counsel. Buyer’s counsel
shall have reasonably approved all legal matters and the form and substance of
all documents Seller, or Seller Equityholder are required to deliver at the
Closing.

5.18                           Payment of all Liabilities. All known liabilities
(including all vendors, personal and real property taxes, and utilities) of the
Sellers incurred prior to the Closing date of the respective purchase shall have
been paid in full by the respective company or the corporate funds necessary to
pay such expenses shall be escrowed or allocated from the Corporate Operating
Account until such time as satisfactory evidence of the payment of the expense
has been received by the Buyer.

6.                                       Conditions Precedent to Seller’s
Obligations.

Seller’s obligations to consummate the transactions contemplated by this
Agreement are subject to the fulfillment (or waiver by Seller ) of each of the
following conditions before or at the Closing:

6.1                                 Accuracy of Representations and Warranties.
Buyer’s representations and warranties contained in this Agreement and all
related documents shall be true and correct on the date of this Agreement and at
and as of the Closing.

6.2                                 Performance of Covenants. Buyer shall have
in all respects performed and complied with all covenants, agreements, and
conditions required by this Agreement and all related documents that must be
performed or complied with before or at the Closing.

7.                                       Closing Matters.

7.1                                 Closing. The closing of the transactions
contemplated in this Agreement  (the “Closing”) shall take place at the offices
of William C. Knowles, Verrill Dana, LLC, One Portland Square, Portland, ME
04112 within 14 days of the date that all license and permits are approved for
transferor at another place and/or on another date that the parties agree on
(the “Closing Date”).

All transactions and all documents executed and delivered at the time of Closing
shall be deemed to have occurred simultaneously, and no transaction shall be
deemed to have occurred and no document shall be deemed to have been executed or
delivered unless all transactions have occurred and all documents have been
executed and delivered. For the purposes of this Agreement, the term Business
Day means a day other than a Saturday or Sunday on which banks are generally
open for business in Maine.

7.2                                 Certain Closing Expenses. Seller shall be
liable for and shall pay all federal, state, and local sales, use, excise, and
documentary stamp taxes and all other similar taxes, duties, or other like
charges properly payable on and in connection with the conveyance and transfer
of the Purchased Equityholder Interests to Buyer.

7.3                                 Further Assurances. Seller shall cooperate
with and assist Buyer and take all other reasonable actions to ensure a smooth
transition of the Business to Buyer. From time to time after the Closing Date,
Seller shall, at the request and expense of Buyer, execute and deliver
additional conveyances, transfers, documents, instruments, assignments,

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applications, certifications, papers, and other assurances that Buyer requests
as required to effectively carry out this Agreement’s intent in good faith and
to transfer the Purchased Equityholder Interests to Buyer.

7.4                                 Title and Liens. At the Closing, title to
the assets owned by KEN-KEV, Inc. and KenkevII shall be free, clear, and
unencumbered, as specifically set forth in this Agreement. To this end at the
closing, the Seller shall cause to be delivered all of the following:

a.                                       Lien Search. Buyer at its expense shall
have obtained a tax lien search and financing statement search, both certified
to a date at or near the Closing Date and each showing that no tax, mechanics,
or other liens have been filed against the property. Seller shall reasonably
cooperate with Buyer to conduct such a search.

b.                                      Application for Conditional Tax
Clearance. Seller shall provide Buyer a letter from the appropriate Maine
authorities concerning liability of KEN-KEV, Inc. and  KenkevII for sales or
withholding taxes, both as of a date near the Closing Date and each showing that
KEN-KEV, Inc. and KenkevII are not in arrears on payments relating to the above
referenced taxes.

7.5                                 Income Taxes.  Buyer and Seller agree that
Buyer shall be responsible for all taxes based on KEN-KEV, Inc. and KenkevII’s
taxable income, to the extent accrued on and after the Closing Date and that
Seller shall be responsible for those amounts before the Closing Date.  In order
to effect this provision, the parties agree that Seller shall cause KEN-KEV,
Inc. and KenkevII to close its books and determine the net taxable income and
federal and state taxes for the pro rated year ending on the day before the
Closing Date and shall include the tax due as a closing adjustment under Article
2.2 and Exhibit 2.4.

8.                                       Seller’s Representations and
Warranties.

The Seller represents and warrants to Buyer as follows as of the date of this
Agreement and as of the Closing Date, and acknowledges and confirms, that Buyer
is relying on these representations and warranties in entering into this
Agreement:

8.1                                 Organization and Standing. KEN-KEV, Inc. and
KenkevII are corporations organized, validly existing, and in good standing
under the laws of the state of incorporation, and have all requisite corporate
power and authority to own its property and conduct its business as it is now
being conducted. The nature of the business and the character of the properties
KEN-KEV, Inc. and  KenkevII own or lease do not make licensing or qualification
of as a foreign entity necessary under the laws of any other jurisdiction.
Except for the use of the name “Platinum Plus” or otherwise as set forth in
Schedule 8.1 (need Schedule).  KEN-KEV, Inc. and KenkevII have not in the last
five years used or assumed any other name in connection with the conduct of its
business.

8.2                                 Articles and Bylaws. Schedule 8.2 contains
true and complete copies of KEN-KEV, Inc. KenkevII’s Articles of Incorporation
and Bylaws.

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8.3                                 Capitalization. KEN-KEV, Inc. and KenkevII’s
authorized capital stock consists solely of 100,000 shares of common stock, of
which 1,000 shares are issued and outstanding respectively. All of the issued
and outstanding Seller Equity Interests are owned of record and beneficially by
the Seller . A true and complete list of the certificate numbers and number of
all shares held by the Seller is set forth in Schedule 8.3. There are no
options, calls, subscriptions, warrants, agreements, or other securities or
rights outstanding for the purchase or other acquisition of Seller’s
Equityholders Interests; that are convertible into, exercisable for, or relate
to Seller’s Equityholder  Interests; or that have any voting rights.  Neither
Corporation has any outstanding contractual obligations to repurchase, redeem,
or otherwise acquire any outstanding shares of Seller’s Equityholder Interests.
Seller is not a party to any Buy-Sell Agreement that would affect in any manner
any of the transactions contemplated in this Agreement.

8.4                                 Seller Equityholder Interests. Seller is the
lawful owner of the Purchased Equity Interests, free from all pledges, liens,
security interests, encumbrances, mortgages, adverse claims, charges, options,
equity interests, proxies, voting agreements or trusts, leases, tenancies,
easements, or other interests (“Encumbrances”). All shares of the Purchased
Equityholder Interests have been authorized and validly issued and are fully
paid, non-assessable, and free of preemptive rights. On delivery to Buyer at the
Closing of the Purchased Equityholder Interests, endorsed for transfer, Buyer
will be the absolute owner of the Purchased Equityholder Interests, free from
all Encumbrances arising by or through Seller, KEN-KEV, Inc. or KenkevII, Inc..

8.5                                 Authorization. Seller has the requisite
legal capacity to execute, deliver, and perform this Agreement and the
Noncompetition Agreements (the “Related Agreements”) to which they are a party
and to consummate any related transactions. Seller  has duly executed and
delivered this Agreement. This Agreement is, and the Related Agreements when
executed and delivered by the parties to them will be, legal, valid, and binding
obligations of Seller, enforceable against Seller in accordance with their
respective terms, except as such enforcement may be limited by bankruptcy,
insolvency, moratorium, or similar laws relating to the enforcement of
creditors’ rights and by general principles of equity (regardless of whether
such enforceability is considered in a proceeding at law or in equity).

8.6           Existing Agreements and Governmental Approvals.

(a)           Except as set forth in Schedule 8.6, the execution, delivery, and
performance of this Agreement and the Related Agreements by Seller and the
consummation of the transactions contemplated by them (i) do not and will not
violate any provisions of law applicable to Seller or KEN-KEV, Inc. or
KenkevII;(ii) do not and will not conflict with, result in the breach or
termination of any provision of, or constitute a default under (in each case
whether with or without the giving of notice or the lapse of time, or both)
Seller’s respective Articles of Incorporation or Bylaws or any indenture,
mortgage, lease, deed of trust; other instrument, contract, or agreement; or any
order, judgment, arbitration award, or decree to which Seller or Seller
Equityholder is a party or by which it or any of its assets and properties are
bound; and (iii) do not and will not result in the creation of any Encumbrance
on any of the properties, assets, or business of Seller, KEN-KEV, Inc. or
KenkevII, Inc..

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(b)           Except as set forth in Schedule 8.6, no approval, authority, or
consent of or filing by Seller, KEN-KEV, Inc. or KenkevII, Inc. with, or
notification to, any federal, state, or local court, authority, or governmental
or regulatory body or agency, or any other corporation, limited liability
company, partnership, individual, or other entity is necessary to authorize the
execution and delivery of this Agreement or any of the Related Agreements or the
consummation of the transactions contemplated by this Agreement or any of the
Related Agreements.

8.7                                 No Subsidiaries. KEN-KEV, Inc. does not have
any subsidiaries or directly or indirectly own any interest or have any
investment in any other corporation, partnership, or other entity, other than a
100% interest in KenkevII, Inc.

8.8                                 No Insolvency. No insolvency proceeding of
any character, including, without limitation, bankruptcy, receivership,
reorganization, composition, or arrangement with creditors, voluntary or
involuntary, affecting Seller or any of its assets or properties is pending or,
to the Best Knowledge of Seller Equityholder, threatened. Neither Seller nor
KenkevII have taken any action in contemplation of, or that would constitute the
basis for, the institution of any such insolvency proceedings. For the purposes
of this Agreement, the phrase Best Knowledge of Seller Equityholders means the
knowledge that the Seller Equityholder has or would have after due inquiry into
the matter in question.

8.9                                 Permits and Licenses. KEN-KEV, Inc. and
KenkevII, Inc. have all necessary permits, certificates, licenses, approvals,
consents, and other authorizations required to carry on and conduct the Business
and to own, lease, use, and operate its assets at the place and in the manner in
which the Business is presently conducted. A complete list of all  permits,
certificates, licenses, approvals, consents, and other authorizations is
included in Schedule 8.9.

8.10                           Financial Statements. [To be reviewed by Seller’s
accountants]Seller has delivered to Buyer the financial statements for the
Corporations listed in Schedule 8.10, and Seller shall deliver, before the
Closing, copies of financial statements for each full month before the Closing
after the periods reflected in such listed financial statements (the “Financial
Statements”). The Financial Statements fairly and accurately present the
financial position of Kenkev and its affiliates as of the dates indicated and
the results of its operations as of the dates indicated and for the periods
covered thereby, and are and will be true and correct in all material respects,
subject to year-end adjustments. All inventories reflected in the Financial
Statements have been and will be valued at the lower of cost or market value,
with cost determined using the last-in, first-out method; adequate provision has
been and will be timely made in the Financial Statements for doubtful accounts
or other receivables; sales are stated in the Financial Statements net of
discounts, returns, and allowances; all Taxes (as defined in Section 8.22) due
or paid are and will be timely reflected in the Financial Statements; and all
Taxes not yet due and payable are and will be fully accrued or otherwise
provided for in the Financial Statements. Any items of income or expense that
are unusual or of a nonrecurring nature during any such period or at any such
balance sheet date are and will be separately disclosed in the Financial
Statements. Except as otherwise disclosed on Schedule 8.10, Seller’s books,
records, and work papers are complete and correct and accurately reflect,

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and will accurately reflect, in all material respects the basis for the
financial condition and the results of KEN-KEV, Inc. and  KenkevII’s operations
that are set forth in the Financial Statements.

8.11                           No Undisclosed Liabilities. Except as otherwise
disclosed on Schedule 8.11 or in the Financial Statements, (none of which have
or will have arisen as a result of negligence, gross negligence, strict
liability, tort, toxic tort, environmental liabilities, violations of law, or
default under any Contract or Commitment attributable to KenkevII or for which
KenkevII shall be responsible), KEN-KEV, Inc. and KenkevII do not have any
debts, liabilities, or obligations or any kind or character whatsoever, whether
accrued, absolute, contingent, matured, not matured, known, unknown, or
otherwise,  of a character as would be required to be reflected in any balance
sheet prepared in accordance with GAAP.

8.12                           Conduct of Business. Except as otherwise
disclosed on attached Schedule 8.12, since the date of execution of the Letter
Agreement dated June 7, 2007 (“the Letter Agreement), KEN-KEV, Inc, and KenkevII
have not:

(a)                                  Issued any capital stock or other
securities convertible into or exchangeable or exercisable for capital stock  or
having voting rights; declared or paid any dividend; made any other payment from
capital or surplus or other distribution of any nature; or directly or
indirectly redeemed, purchased, or otherwise acquired, recapitalized, or
reclassified any of its capital stock.

(b)                                 Merged with any other entity.

(c)                                  Altered or amended its Articles of
Incorporation or Bylaws.

(d)                                 Entered into, materially amended, or
terminated any contract, license, lease, commitment or permit, except in the
ordinary course of business consistent with past practices.

(e)                                  Experienced any labor disturbance.

(f)                                    Incurred or become subject to any
obligation or liability (absolute, accrued, contingent or otherwise), matured,
not matured, except (i) in the ordinary course of business consistent with past
practices and (ii) in connection with the performance of this Agreement.

(g)                                 Discharged or satisfied any Encumbrance or
paid or satisfied any obligation or liability (absolute, accrued, contingent, or
otherwise) other than (i) liabilities shown or reflected in the respective
balance sheet dated August 31, 2007 or (ii) liabilities incurred since the date
of the balance sheet, in each such case only in the ordinary course of business
consistent with past practices and in accordance with the express terms of such
obligation or liability.

(h)                                 Mortgaged, pledged, or subjected to any
Encumbrance any of its assets.

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(i)                                     Sold, transferred, or agreed to sell or
transfer any asset or business; cancelled or agreed to cancel any debt or claim;
or waived any right, except in the ordinary course of business consistent with
past practices.

(j)                                     Disposed of or permitted to lapse any
Intellectual Property.

(k)                                  Granted any increase in employee rates of
pay or any increases in salary payable or to become payable to any officer,
employee, consultant, or agent, or by means of any bonus or pension plan,
contract, or other commitment increased the compensation of any officer,
director, employee, consultant, or agent, or hired any new officer, employee,
consultant, or agent, except in the ordinary course of business.

(l)                                  Made or authorized any capital expenditures
for additions to plant or equipment accounts in excess of $10,000.00.

(m)                               Entered into any transaction (including,
without limitation, any contract or other arrangement providing for employment,
furnishing of services, rental of real or personal property, or otherwise
requiring payments) with any shareholder, officer, or director of KenkevII; any
member of their immediate families; or any of their affiliates.

(n)                                 Experienced any material damage,
destruction, or loss (whether or not covered by insurance) affecting its
properties, assets, or Business.

(o)                                 Failed to regularly maintain and repair its
assets in the ordinary course of business consistent with past practices.

(p)                                 Instituted or settled any litigation,
action, or proceeding before any court or governmental body relating to it or
its property.

(q)                                 Made any change in any method of accounting
or any accounting practice or suffered any deterioration in accounting controls.

(r)                                    Varied, cancelled, or allowed to expire
any insurance coverage, except as agreed by the parties in writing.

(s)                                  Made any payment or disbursement of moneys
or property or declared or paid any dividend or other distribution to or on
behalf of any officer, director, or shareholder of KenkevII or any member of the
immediate families of any of the Seller Equityholder, or any affiliate, other
than for payment of compensation or reimbursement of expenses in accordance with
past practices.

(t)                                    Entered into any other transaction other
than in the ordinary course of business consistent with past practices.

(u)                                 Agreed or committed to do any of the
foregoing.

8.13                           No Adverse Changes. Except as otherwise disclosed
in Schedule 8.13, since the date of execution of the Letter Agreement, there has
not been any occurrence, condition, or development that has adversely affected,
or is likely to adversely affect, the Seller, or its prospects, condition
(financial or otherwise), operations, assets, or the Business.

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8.14                           Employees. That except as disclosed on Schedule
8.14 (Schedule), there is not now, nor has there been at any time during the
past five years, any strike, lockout, grievance filing, other similar labor
dispute against KenkevII or that in any manner affects KenkevII. KenkevII is and
has been, to the best of its knowledge, in compliance with all rules regulating
employee wages and hours. Buyer acknowledges that Kenkev has not treated the
entertainers as employees and that such treatment is of an uncertain nature.  
This acknowledgement pertains to the entertainer/employee issue every where it
is mentioned in this Agreement.  On or before the Closing Date, Kenkev shall
have paid all its accrued obligations relating to employees (whether arising by
operation of law, by contract, or by past service) or payments to trusts or
other funds, to any governmental agency, or to any individual employee (or his
or her legal representatives) with respect to unemployment compensation
benefits, profit sharing, retirement benefits, or Social Security benefits.
Kenkev has, to the best of its knowledge,  complied with all requirements of the
U.S. Immigration and Nationality Act, as amended, including without limitation
all employment verification and antidiscrimination provisions applicable to
current and former employees of Kenkev.

8.15         Employee Benefit Plans.[Subject to review by Seller’s accountants.]

(a)           Schedule 8.15 contains a true and complete list of all plans,
contracts, programs, and arrangements (including, but not limited to, collective
bargaining agreements, pensions, bonuses, deferred compensation, retirement,
severance, hospitalization, insurance, salary continuation, and other benefit
plans, programs, or arrangements) maintained currently or at any time within the
previous five years by Kenkev or under which Kenkev has had any obligations with
respect to an employee, director, or shareholder of Kenkev (the “Plans”).

(b)           True, correct, and complete copies of the following documents, wit
respect to each of the Plans, if applicable, have been made available or
delivered to the Buyer: (i) any plans and related trust documents, and
amendments thereto; (ii) the two most recent Forms 5500; (iii) the last IRS
determination letter, if applicable; (iv) the most recent actuarial report; (v)
summary plan descriptions; (vi) the two most recent Forms PBGC-1, and (vii) with
respect to any Plan that is maintained pursuant to a collective bargaining
agreement, all collective bargaining agreements pursuant to which contributions
are being made or obligations are owed to such Plan, and all contracts with
third-party administrators, actuaries, investment managers, consultants, and
other independent contractors that relate to any such Plan.

(c)           Except as specifically set forth in Schedule 8.15, (i) each Plan
that is an employee pension benefit plan, (if any) as defined in Section 3(2) of
ERISA, 29 USC 1002(2), and its related trust (“Pension Plan and Trust”) now
meet, and since their inception have met, the requirements for qualification
under Sections 401(a) and, if applicable, 401(k) of the Internal Revenue Code of
1986, as amended (the “Code”), and are now, and since their inception have been,
exempt from taxation under IRC 501(a), and the Internal Revenue Service (IRS)
has issued a current favorable determination letter with respect to the
qualified status of each Pension Plan and Trust and has not taken any action to
revoke such letter; (ii) Kenkev has

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performed all obligations required to be performed by it under the Plans
(including, but not limited to, the making of all contributions) and is not in
default under and has no knowledge of any default by any other party to the
Plans; (iii) each Plan is in material compliance as to form and operation, in
accordance with all applicable provisions of the Code and ERISA and any other
applicable federal and state laws (including rules and regulations thereunder),
and each Plan has been operated in compliance with such laws and written plan
documents; (iv) neither Kenkev nor, to the Best Knowledge of Seller
Equityholder, any other disqualified person or party in interest, within the
meaning of IRC 4975 or Section 3(14) of ERISA, 29 USC 1002(14), has engaged in
any prohibited transaction, as this term is defined in IRC 4975 or Section 406
of ERISA, 29 USC 1106, that could, following the Closing Date, subject any Plan
(or its related trust), Buyer, Kenkev, or any officer, director or employee of
Buyer or Kenkev, to any tax or penalty imposed under the Code or ERISA; (v)
there are no actions or claims pending (other than routine claims for benefits)
or, to the Best Knowledge of Selling Equityholder, threatened against any Plan
or against the assets of any Plan; (vi) no Plan is subject to Part 3 of Title I
of ERISA, Section 412 of the Code, or Title IV of ERISA; (vii) each Plan’s plan
official, as defined in Section 412 of ERISA, 29 USC 1112, is bonded to the
extent required by Section 412; (viii) no proceeding has been initiated to
terminate any Plan, and any such termination will not subject Kenkev or Buyer to
liability to any person; (ix) no Plan is a multiemployer plan, as defined in
Section 3(37) of ERISA, 29 USC 1002(37); (     x) no retiree benefits are
payable under any Plan that is an employee welfare benefit plan (“Welfare
Plan”), as this term is defined in Section 3(1) of ERISA, 29 USC 1002(1); and
(xi) each Welfare Plan that is a group health plan within the meaning of IRC
5000 complies with and in each case has complied with the applicable
requirements of Sections 601 through 608 of ERISA, 29 USC 1161–1168, and IRC
4980B.

(d)           Kenkev has not incurred or will not incur with respect to any Plan
that is an employee benefit plan, as defined in Section (3)(3) of ERISA, 29 USC
1002(3), any actual or contingent liability, including, but not limited to,
liability under Section 601 through 608 of ERISA, 29 USC 1161–1168, and IRC
4980B, any withdrawal liability from any multiemployer pension plan, any
termination or withdrawal liability under Sections 4062, 4063, or 4064 of ERISA,
29 USC 1362, 1363, or 1364, any accumulated funding deficiency as such term is
defined in Section 302 of ERISA, 29 USC 1082, and IRC 412 (whether or not
waived), any requirement to make any contributions to any multiemployer plan,
solely as a result of Seller being a member of a controlled group of
corporations, or treated as a single employer with any other entity within the
meaning of IRC 414(b), 414(c), 414(m), or 414(n) arising from or incurred with
respect to any period before the Closing Date.

8.16                           Certain Employees. Each of the following is
included in the list of agreements in Schedule 8.15: all collective bargaining
agreements, employment and consulting agreements, executive compensation plans,
bonus plans, deferred compensation plans, pension or retirement plans,
participation plans, tip-pooling arrangements,

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profit-sharing plans, equity interest purchase and equity interest option plans,
hospitalization insurance, and other plans and arrangements, providing for
compensation and/or benefits to Kenkev’s employees, directors, or shareholders.

(a)                                  Schedule 8.16 contains a true and complete
list of the following: the names, positions, and compensation of the present
directors, officers, employees, and current independent contractors of Kenkev.
Except as listed in Schedule 8.16, all Kenkev’s employees are employees-at-will,
may be terminated at any time in accordance with the written policies (copies of
which are contained in Schedule 8.16) of Kenkev for any lawful reason or for no
reason, and are not entitled to employment by virtue of any oral or written
contract, employer policy, or otherwise.

(b)                                 No retired employees of Kenkev are receiving
or are entitled to receive any payments or health or other benefits from Kenkev.

(c)                                  Buyer agrees to continue employment of all
employees post closing as at-will employees. Seller Equityholder agrees that he
will not solicit/hire any employee provided that Buyer maintains its current
compensation program, and provided Buyer does so, then Seller Equityholder may
not solicit or hire any employee to work for him or any related entity for 6
months from the Closing Date; furthermore, for the 6 months after such initial
6-month period, Seller Equityholder agrees that he will consult with Buyer
before soliciting/hiring any such employee.  If Buyer changes the Compensation
Program and such change results in the Employee making substantially less
income, then the non-hiring provision shall not apply. The same provisions shall
apply to entertainers, except that if an entertainer shows up unsolicited to
another location owned or affiliated with Seller Equityholder, they will be
permitted to work. None of the above shall apply to Kevin Fox, whom Buyer has
agreed to pay a salary of $2,500.00 a week for a minimum of 60 days, provided
Mr. Fox agrees to work for this same period of time, and thereafter, an
additional 30 days at Mr. Fox’s option. Thereafter, Seller Equityholder may
solicit or hire Mr. Fox.   It is the general intent of the Buyer and Seller that
should any manager’s net income be reduced by 10% or more on the average, during
any forty-five (45) day period, that the Seller would have the option of hiring
such manager.

8.17                           Contracts and Commitments.

(a)                                  Schedule 8.17 contains a true and complete
list of all of KEN-KEV, Inc, and KenkevII ‘s written, and a description of all
of KenkevII’s unwritten, contracts, obligations, agreements, plans,
arrangements, and commitments of any kind or nature (the “Contracts and
Commitments”), except for

(i)                                  those contracts that are described in
another Schedule;

(ii)                              each purchase contract with a customer made in
the ordinary course of business consistent with past practices under which

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KEN-KEV, Inc. or KenkevII is obligated to deliver less than $500.00  in goods
and/or services in each transaction or series of related transactions; and

(iii)                          each purchase commitment made in the ordinary
course of business at prevailing prices, consistent with past practices, that is
not in excess of $1000.00 in each transaction or series of related transactions.

(b)                                 All Contracts and Commitments are in full
force and effect without amendment (unless the amendments are clearly noted),
and Buyer is and shall be entitled to all benefits from all Contracts and
Commitments.

(c)                                  True and complete copies of all Contracts
and Commitments have been delivered to Buyer. All Contracts and Commitments are
the result of bona fide, arm’s-length transactions and are legal, valid, and
binding obligations of the parties to them enforceable in accordance with their
respective terms, subject to laws generally governing bankruptcy and the
enforcement of creditors’ rights.

(d)                                 Except as set forth in attached Schedule
8.17, no default or alleged default exists on the part of KEN-KEV, Inc. or
KenkevII nor, to the Best Knowledge of Seller Equityholder, on the part of any
other person or entity, under any Contract or Commitment.

8.18                           Title to Assets. Except as set forth in attached
Schedule 8.18, KEN-KEV, Inc. or KenkevII is the sole and absolute owner, lessee
or license holder of all the assets used in the operation of the Business and/or
purported to be owned by KEN-KEV, Inc. and KenkevII, and has good and marketable
title to all such assets, free from all Encumbrances (or, in the case of its
interest as lessee, a good leasehold interest, and in the case of licenses, is
the license holder). Schedule 8.18 lists or describes all property used in the
conduct of the Business and/or situated on the Premises that is owned by or an
interest in which is claimed by any other person or entity (whether a customer,
supplier, or other person or entity) for which KEN-KEV, Inc. or KenkevII is
responsible, together with copies of all related agreements. All such property
is situated on the Premises and is in such condition that, upon return to its
owner, KEN-KEV, Inc. KenkevII will not be liable in any amount to the owner.

8.19                           Condition of Assets. Each item situated at the
Premises and listed on the respective balance sheet is being sold as is, where
is, with all defects. Between the date of this Agreement and Closing, Seller
agrees to reasonably maintain all equipment and assets as may be need to
reasonably operate the business. Furthermore, Seller agrees not to commit waste.

8.20                           Receivables. KEN-KEV, Inc. and KenkevII, Inc. are
entitled to all accounts receivable relating to activity prior to the Closing
Date and Buyer shall assist in collecting any such amounts and Buyer shall
promptly forward to Seller any such

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amounts that Buyer receives on or after the Closing Date, which amounts shall be
applied to the closing adjustments and any net amount distributed to
Equityholder.

8.21                           Sufficiency of Assets. The assets reflected in
the Financial Statements, constitute and will constitute all of the property and
assets, real, personal, and mixed, tangible and intangible (including, without
limitation, contract rights), that are used or useful in, or are necessary for
the conduct of, the Business in accordance with present practices, other than
(i) those permits and licenses that Buyer will be obtaining as a condition to
its obligation to close, (ii) assets used or consumed in the ordinary course of
business prior to the Closing date,  and (iii) the Excluded Assets that are
referred to above and that Seller shall be entitled to retain (including cash
and receivables), and such assets are sufficient for Buyer to continue to
operate the Business in the ordinary course of business after the Closing Date.
By closing this agreement, the Buyer shall be deemed to be satisfied with the
assets of the Business.

8.22                           Taxes.[To be reviewed by Seller’s accountants.]

(a)                                  For the purposes of this Agreement, Tax or
Taxes shall mean all federal, state, county, local, foreign, and other taxes
(including, without limitation, income taxes; premium taxes; single-business
taxes; excise taxes; sales taxes; use taxes; value-added taxes; gross receipts
taxes; franchise taxes; ad valorem taxes; real estate taxes; severance taxes;
capital levy taxes; transfer taxes; stamp taxes; employment, unemployment, and
payroll-related taxes; withholding taxes; and governmental charges and
assessments), and include interest, additions to tax, and any penalties. For
purposes of this Agreement, (i) a Tax is “imposed” upon a person if such person
is responsible under applicable law for the payment, withholding, or collection
of such Tax; (ii) a person is “subject to” a Tax if such Tax is imposed on
either (A) such person or (B) a third party based on the activities or assets of
such person; and (iii) a Tax is “of” a person if either clause (i) or (ii) of
this Section 8.22(a) pertains to such Tax and such person.

(b)                                 For purposes of this Agreement, Tax Return
shall mean any return (including any information return), report, statement,
schedule, notice, form, or other document or information filed with or submitted
to, or required to be filed with or submitted to, any governmental authority in
connection with the determination, assessment, collection, or payment of any
Tax.

(c)                                  Except as otherwise disclosed on Schedule
8.22, KEN-KEV, Inc. and KenkevII, Inc. has filed on a timely basis (within any
applicable extension periods) all Tax Returns it is required to file under any
federal, state, local, or foreign law and has paid or established an adequate
reserve with respect to all Taxes imposed on said corporation for the periods
covered by such returns. No claim has ever been made by a governmental authority
in a jurisdiction where Kenkev does not file Tax Returns that it is or may be

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subject to Taxes imposed by that jurisdiction. No agreements have been made by
or on behalf of Kenkev for any waiver or for the extension of any statute of
limitations governing the time of assessment or collection of any Taxes. Kenkev
and its officers have received no notice of any pending or threatened audit by
the IRS or any state, local, or foreign agency related to Kenkev’s Tax Returns
or Tax liability for any period, and no claim for assessment or collection of
Taxes has been asserted against Kenkev. There are no federal, state, or local
Tax Encumbrances outstanding against any of Kenkev’s assets. There are no
outstanding powers of attorney issued by Kenkev with respect to any matter
relating to Taxes.

(d)                                 Kenkev has withheld and paid all Taxes
required to have been withheld and paid in connection with amounts paid or owing
to any employee, independent contractor, creditor, stockholder, or other person
or entity. KenkevII has, in accordance with Treasury Regulation Section
1.6662-3(c), “adequately disclosed” on its Tax Returns all positions taken
therein that could give rise to a substantial understatement of federal income
Tax within the meaning of IRC 6662, or, as applicable, such disclosure would
meet the conditions of any provision analogous or similar to Treasury Regulation
Section 1.6662-3(c) contained in any state, local, or foreign tax law to which
it is asserted that KenkevII is or could be subject. There are no Tax rulings or
requests for rulings relating to KenkevII that could affect KenkevII’s Tax
liability for any period (or portion of a period) after the Closing Date.

(e)                                  Seller  will as of the Closing Date provide
to Buyer its correct taxpayer identification number on executed IRS Form W-9.
Buyer is not required to withhold any Taxes on any payments under this Agreement
including, without limitation, any withholding pursuant to IRC 3406 or Chapter 3
of the Code. Seller and Seller  is a United States person (as defined in IRC
7701(a)(30)).

(f)                                    If Seller is an S corporation, Seller is
now and has been at all times since            N.A.            a validly
electing S corporation within the meaning of IRC 1361 and 1362 and will be a
validly electing S corporation up to and including the Closing Date.

 (g)                              No property of Kenkev is tax-exempt use
property within the meaning of IRC 168(h) or tax-exempt bond financed property
within the meaning of IRC 168(g). Kenkev has not made, nor is obligated to make,
any payment nor is a party to any agreement that could obligate it to make any
payments that, under IRC 280G or IRC 162(m), were or will not be deductible for
Tax purposes.

(h)                                 Kenkev is not a United States real property
holding corporation within the meaning of IRC 897.

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(i)                                     Kenkev is not subject to any Tax sharing
or similar agreement or arrangement (whether or not written) pursuant to which
it will have any obligation to make any payments after the Closing Date.

(j)                                     Kenkev will not be required to include
any item of income or gain in, or to exclude any item of deduction or loss from,
taxable income for any taxable period (or portion thereof) ending after the
Closing Date as a result of any (i) change in method of accounting for a taxable
period ending on or before the Closing Date under IRC 481(c), or any
corresponding or similar provision of state, local, or foreign Tax law; (ii)
closing agreement as described in IRC 7121, or any corresponding or similar
provision of state, local, or foreign Tax law, executed on or before the Closing
Date; or (iii) installment sale made on or before the Closing Date.

(k)                               Any adjustment of Tax of Kenkev made by the
IRS in any examination that is required to be reported to the appropriate state,
local, or foreign taxing authorities has been reported, and any additional Taxes
due with respect thereto have been paid, to the best knowledge of Seller.

(l)                                     (i) Kenkev has not, within the last six
years, been a member of an affiliated group (as defined in IRC 1504(a)) filing a
consolidated United States federal income Tax Return, or similar Tax Return
under the provisions of state, local or foreign law; and (ii) no claim has been
asserted against KenkevII based upon liability for the Taxes of another person
(A) under Treasury Regulation Section 1.1502-6 or any corresponding or similar
provisions of state, local, or foreign law, (B) as a transferee or successor, or
(C) by contract or otherwise. KenkevII does not have a subsidiary investment
that could reasonably be expected to be subject to the loss disallowance rules
of Temporary Treasury Regulation Section 1.337(d)-2T.

8.23                           Litigation. There are no claims, disputes,
actions, suits, proceedings, or investigations pending or, to the Best Knowledge
of the Seller Equityholder, threatened against or affecting KenkevII, its
business, or its assets.

8.24                           INTENTIONALLY DELETED.

8.25                           Environmental Matters.

INTENTIONALLY DELETED

8.26                           Compliance with Laws. At all times before the
Closing Date, KEN-KEV, Inc. and KenkevII have, to the best of its knowledge, 
complied with all laws, orders, regulations, rules, decrees, and ordinances
affecting to any extent or in any manner any aspects of the Business or its
assets or, to the extent an issue has been raised, KenkevII has responded.

8.27                           Suppliers and Customers.

(a)                                  A complete and accurate list of all
suppliers or vendors of products or services to Kenkev in connection with the
Business (other than legal or

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accounting services) aggregating more than $10,000.00 (at cost) annually during
Kenkev’s last fiscal year, and the address of each supplier or vendor and the
amount sold to Kenkev during that period, is set forth in Schedule 8.27. The
names of any suppliers of goods or services with respect to which practical
alternative sources of supply are not available on comparable terms and
conditions are separately listed in Schedule 8.27.

(b)                                 KenkevII does not keep records of its
customers.

(c)                                  Seller Equityholder has no information that
might reasonably indicate that any supplier of Kenkev intends to cease
purchasing from, selling to, or dealing with Kenkev. No information has been
brought to the attention of  Seller Equityholder that might reasonably lead any
of him to believe that any supplier intends to alter, in any material respect,
the amount of its sales or the extent of its dealings with Kenkev, or would
alter in any material respect its sales to, or dealings with Kenkev, in the
event the transactions contemplated by this Agreement are consummated.

8.28                           No Brokers. Neither Seller nor Seller
Equityholder have engaged, or are responsible for any payment to, any finder,
broker, or consultant in connection with the transactions contemplated by this
Agreement, except for Frank Bain, who will be compensated by Buyer, pursuant to
an agreement exclusive between Buyer and Mr. Bain that is acceptable to Mr.
Bain, as verified by a letter from Mr. Bain.

8.29                           Insider Transactions. Seller has furnished Buyer
a complete and accurate list and a brief description of all contracts or other
transactions involving Kenkev in which any officer, director, employee, or
shareholder of Kenkev or any member of their immediate families; or any
affiliate has any interest is set forth on Schedule 8.29.

8.30                           Bank Accounts. The Buyer shall establish a new
separate bank account in the name of Kenkev. However,  Seller shall  close its
bank accounts for Ken-Kev, Inc. and Kenkev within 60 days after Closing. 8.31
Intellectual Property.

Schedule 8.31 lists or briefly describes all of Kenkev’s material Intellectual
Property (other than know-how, trade secrets, and confidential and proprietary
processes and technology) that Kenkev directly or indirectly owns, licenses,
uses, requires for use, or controls in whole or in part, including rights
relating to the playing of music and video, and all licenses and other
agreements allowing the Kenkev to use the intellectual property of third
parties. Kenkev does not own, directly or indirectly, or use any patents,
copyrights, trademarks, or service marks in the Business, except as disclosed on
Schedule 8.31. Except as set forth in Schedule 8.31, Kenkev is the sole and
exclusive owner of the Intellectual Property, free and clear of all
Encumbrances. Kenkev’s Intellectual Property, or its use by Kenkev or any
activity of Kenkev in the conduct of the Business, does not infringe on any
other person’s intellectual property, and, to the Best Knowledge of the Seller
Equityholder, no activity of any other person infringes on any of the
Intellectual Property. Kenkev has been and is now conducting the

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Business in a manner that has not been and is not now in violation of any other
person’s intellectual property, and Kenkev does not require a license or other
proprietary right to so operate the Business. For the purposes of this
Agreement, Intellectual Property means all intellectual property and
intellectual property rights owned or licensed by Kenkev including, but not
limited to, all inventions, discoveries, improvements, designs, prototypes,
trade secrets, manufacturing and engineering drawings, process sheets,
specifications, bills of material, patents, patent applications, registered and
unregistered copyrights and copyright rights in both published and unpublished
works, registered and unregistered trademarks, registered and unregistered trade
names, formulae and secret and confidential processes, know-how, technology,
process technology, customer lists, computer software, data, databases and other
industrial property (whether patentable or unpatentable), all rights to sue for
infringement of any of the foregoing, all renewals or extensions of any of the
foregoing, and all goodwill of Kenkev relating to any of the foregoing.

8.32                           Insurance. All insurance policies covering
Kenkev’s property or providing for business interruption, personal, and other
insurance are described in Schedule 8.32 (which specifies the insurer, policy
number, type of insurance, and any pending claims). Such insurance is in amounts
Kenkev deems sufficient with respect to its assets, properties, business,
operations, products, and services as the same are presently owned or conducted,
and all such policies are in full force and effect and the premiums have been
paid. There are no claims, actions, suits, or proceedings arising out of or
based on any of these insurance policies, and no basis for any such claim,
action, suit, or proceeding exists. Kenkev is not in default with respect to any
provisions contained in any such insurance policies and has not failed to give
any notice or present any claim under any such insurance policy in due and
timely fashion.

8.33                           Materiality. No statement in this Agreement, in
any schedule to this Agreement, or in any certificate delivered to Buyer
pursuant to this Agreement fails or will fail to contain any material fact
necessary to make the statement(s) not misleading.

9.                                       Buyer’s Representations and Warranties.
Each of VCG Holding Corporation and Buyer represents and warrants to Seller
Equityholders as of the date of this Agreement and the Closing Date that:

9.1                                 Organization and Standing. Buyer is a
corporation which will be formed and organized and validly existing under the
laws of the State of Maine, and Buyer will have all the requisite power and
authority to own its properties and to perform its obligations hereunder.

9.2                                 Authorization. VCG Holding Corporation  has
taken, and Buyer will have taken on or before the Closing, all necessary action
(a) to approve the execution, delivery, and performance of this Agreement and
each of the Related Agreements and (b) to consummate the transactions
contemplated under these agreements. VCG Holding Corporation  has duly executed
and delivered this Agreement. This

21

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Agreement is, and each of the Related Agreements when executed by the parties
will be, the legal, valid, and binding obligations of VCG Holding Corporation
and Buyer, enforceable against VCG Holding Corporation  and Buyer in accordance
with their respective terms, except as such enforcement may be limited by
bankruptcy, insolvency, moratorium, or similar laws relating to the enforcement
of creditors’ rights and by general principles of equity (regardless of whether
such enforceability is considered in a proceeding at law or in equity).

9.3                                 Existing Agreements and Governmental
Approvals.

(a)                                  Except as set forth on Schedule 8.6, the
execution, delivery, and performance of this Agreement and the consummation of
the transactions contemplated by it (i) do not and will not violate any
provisions of law applicable to VCG Holding Corporation or Buyer; (ii) do not
and will not conflict with, result in the breach or termination of any provision
of, or constitute a default under (in each case whether with or without the
giving of notice or the lapse of time, or both) VCG Holding Corporation’s  or
Buyer’s Articles of Incorporation or Bylaws or any indenture, mortgage, lease,
deed of trust, or other instrument, contract, or agreement or any order,
judgment, arbitration award, or decree to which VCG Holding Corporation or Buyer
is a party or by which either of them or any of their respective assets and
properties are bound; and (iii) do not and will not result in the creation of
any Encumbrance on any of VCG Holding Corporation’s or the Buyer’s properties,
assets, or business.

(b)                                 Except as set forth on Schedule 8.6, no
approval, authority, or consent of, or filing by VCG Holding Corporation or
Buyer with, or notification to, any federal, state, or local court, authority,
or governmental or regulatory body or agency or any other corporation, limited
liability company, partnership, individual, or other entity is necessary to
authorize VCG Holding Corporation or Buyer’s execution and delivery of this
Agreement or the consummation of the transactions contemplated by this
Agreement.

9.4                                 Investment Intent. Buyer is acquiring the
Purchased Equity Interests for its own account, for investment, and without any
present intention to resell the Purchased Equity Interests.

10.                                 Indemnification; Limitation on Liability.

10.1                           Indemnification by Seller. Seller represents to
Buyer that, to the best of Seller’s knowledge,  at all times relevant to this
agreement; the Seller has maintained at least $1,000,000.00 in liability
insurance, including liquor liability insurance.  Seller Equityholder shall pay,
reimburse, indemnify, and hold harmless Buyer, KEN-KEV, Inc. and KenkevII and
their respective directors, officers, shareholders, successors, and permitted
assigns from and against any and all claims, suits, actions, assessments,
losses, diminution in value, liabilities, fines,

22

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penalties, damages (compensatory, consequential, direct, indirect, and other),
costs, and expenses (including reasonable legal fees) (“Losses”), and including
any Losses that arise in the absence of a third-party claim, to the extent of a
total aggregate of $500,000.00 beyond the amount of insurance. In addition,
Seller and Seller Equity holder agree to indemnify Buyer for (a) Any inaccuracy
in any representation or breach of any warranty of the Seller Equityholders
contained in this Agreement (whether at the date of this Agreement or the
Closing Date), and (b) Seller Equityholders’ failure to perform or observe in
full, or to have performed or observed in full, any covenant, agreement, or
condition to be performed or observed by the Seller Equityholders under this
Agreement or any Related Agreement.

10.2                           Limitation on Liability.  Notwithstanding
anything in this Agreement to the contrary, Selling Shareholder shall have no
personal liability for any matter arising under or relating to this Agreement,
beyond the amount of $500,000.00 for a period of three years, which Seller
Shareholder may permit to be offset, in whole or in part against Rent to the
Landlord.  Seller and Selling Shareholder acknowledge that they may have
liability under one or more of the Related Agreements, to the extent set forth
therein, and this limitation applies only to this Agreement.

10.3                           Waiver of Claims Against Seller. Each Seller
Equityholder irrevocably waives and agrees that Seller Equityholders will make
no claim against Seller of any kind or character, whether by way of subrogation,
indemnity, contribution, breach of contract, or any other theory regarding any
claim made by Buyer, Seller, or any other person under Section 10 or otherwise,
and each Seller Equityholder irrevocably releases and discharges Seller from any
such claim.

10.4                           Indemnification by Buyer. Buyer shall pay,
reimburse, indemnify, and hold harmless Seller and Seller Equityholder and their
respective directors, officers, shareholders, heirs, successors, and permitted
assigns from and against any and all Losses, and including any Losses that arise
in the absence of a third-party claim, in connection with or resulting from any
claim arising from or relating to Buyer’s operation of the Seller or which
arises from a claim that occurred after the Closing Date. In addition, Buyer
agrees to indemnify Seller and Seller Equityholder Buyer from (a) Any inaccuracy
in any representation or breach of any warranty of the Buyer contained in this
Agreement (whether at the date of this Agreement or the Closing Date), and (b)
Buyer’s failure to perform or observe in full, or to have performed or observed
in full, any covenant, agreement, or condition to be performed or observed by
the Buyer under this Agreement or any Related Agreement.

11.1                           Indemnification for Taxes.

(a)           Seller and Seller Equityholder agree to pay, reimburse, indemnify,
and hold harmless Buyer and its directors, officers, shareholders, successors,
and permitted assigns, from and against any and all Taxes imposed upon Kenkev
payable with respect to, and any and all other Losses arising out of or in any
manner incident, relating, or attributable to Taxes imposed upon Kenkev

23

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payable with respect to, or Tax Returns required to be filed by Kenkev with
respect to, income of Kenkev for (i) any taxable year (or other applicable
reporting period) (a “Reporting Period”) of Kenkev ending on or before the
Closing Date (“Pre-closing Tax Period”) other than Losses arising from
transactions occurring after the Closing, and (ii) any Reporting Period of
Kenkev that begins before the Closing Date and that ends after the Closing Date
(a “Straddle Period”), except that with respect to any Straddle Period, Seller
Equityholder shall be responsible for the payment of such Taxes only to the
extent that they relate to the portion of such Straddle Period ending on the
Closing Date.  In addition, Seller shall be responsible up to the aggregate
amount set forth in Paragraph 10.1 above, for any amounts which become due for
the period of time that the Seller operated the business as a result of any
recharacterization of entertainers at the business as employees.

(b)           Buyer and VCG Holding Corporation agrees to pay, reimburse,
indemnify, and hold harmless Seller  and its directors, officers, shareholders,
successors, and permitted assigns (including any in their capacities as officers
or directors of Kenkev prior to the Closing) from and against any and all Taxes
imposed upon Kenkev payable with respect to, and any and all other Losses
arising out of or in any manner incident, relating, or attributable to (i) Taxes
imposed upon Kenkev payable with respect to, or Tax Returns required to be filed
by Kenkev with respect to, income of Kenkev for any Reporting Period of Kenkev
beginning after the Closing Date, (ii) Taxes imposed upon income of Kenkev for
the Straddle Period to the extent attributable to the portion of the Straddle
Period beginning on or after the Closing Date, and  (iii) Taxes imposed upon
Kenkev, or for which Kenkev may otherwise be liable, as a result of transactions
occurring on or after the Closing .

(c)           The indemnities set forth in this Section 11.1 shall survive, in
each case, until the applicable statute of limitations has expired for each
respective fiscal tax year.

11.2                           Preparation of Tax Returns. [To be reviewed by
Seller’s accountants]

(a)                                  Seller and Seller Shareholder shall prepare
or cause to be prepared all Tax Returns for income of Kenkev for any Pre-closing
Tax Period of Kenkev (including amended Tax Returns) (“Pre-closing Period
Returns”). Seller shall timely file, or cause to be timely filed, all such
Pre-closing Period Returns that are due on or before the Closing Date (giving
effect to any extensions thereto). Seller shall timely pay, or cause to be paid,
all Taxes imposed upon Seller with respect to such Pre-closing Period Returns.

(b)                                 Seller shall prepare or cause to be prepared
and provide Buyer with Pre-closing Period Returns that are due after the Closing
Date (giving effect to any extensions thereto). Promptly upon the finalization
of such Tax Returns and in any case not later than 60 30 days before the last
date for

24

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timely filing of such Tax Returns (giving effect to any valid extensions
thereof), Seller shall deliver to Buyer (1) an original of such Tax Return and
(2) a check payable to the appropriate taxing authority in the amount of any
Taxes payable by Kenkev shown as due thereon in accordance with Article 7.5
hereinabove. Buyer shall cause such Pre-closing Period Returns to be executed by
the appropriate officer of Seller and shall file such returns, together with the
appropriate payment, if any, on a timely basis.[Can we avoid this by doing a
stub period filing?]

(c)                                  All Tax Returns that Seller is required to
prepare or cause to be prepared in accordance with this Section 11.2 shall be
prepared in a manner consistent with past practice, and on such Tax Returns no
positions shall be taken, elections made, or method adopted that is inconsistent
with positions taken, elections made, or methods used in preparing and filing
similar Tax Returns in prior periods (including, but not limited to, positions
that would have the effect of deferring income to periods for which Buyer is
liable or accelerating deductions to period for which Kenkev is liable).

(d)                                 Buyer shall prepare or cause to be prepared
all Tax Returns of Kenkev for any and all Reporting Periods ending on and after
the Closing Date. Buyer shall timely file, or cause to be timely filed, all such
Tax Returns and Buyer shall timely pay, or cause to be paid, all Taxes imposed
upon with respect to such Tax Returns.

(e)                                  Buyer shall prepare, or cause to be
prepared, all Tax Returns of Kenkev for any and all Straddle Periods.

All Tax Returns for a Straddle Period shall be submitted to Seller at least 45
days before the last date for timely filing of such Tax Return (giving effect to
any valid extensions thereof), accompanied by a statement calculating in
reasonable detail and in accordance with Section 11.2(f) any payments required
of Seller with respect to the amounts payable by Kenkev shown as due on such Tax
Returns after giving effect to any Tax payments made before the Closing Date.
The amount of any Tax payment required of Seller under this Section 11.2(e)
shall be paid by Seller on or before the last date for timely filing such Tax
Return (including any valid extensions thereof).

(f)                                    With respect to any Straddle Period,
Seller shall be responsible only for such Taxes imposed upon income of Kenkev as
are allocable to the portion of the Straddle Period ending on the day before the
Closing Date. Buyer shall be responsible for, and shall timely pay, or cause to
be paid, all other Taxes with respect to all Straddle Periods. The Tax
liabilities for each Straddle Period for Kenkev shall, except as otherwise
required by applicable law, be determined by closing the books and records of
Kenkev as of the Closing Date by treating each such Straddle Period as if it
were a separate Reporting Period, and by employing accounting methods that are

25

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consistent with those employed in preparing the Tax Returns for Kenkev in
Pre-closing Period Returns and that do not have the effect of distorting income,
receipts, or expenses (taking into account the transactions contemplated by this
Agreement), except that (a) transactions occurring on the Closing Date and after
the Closing shall be allocated to the taxable year or period that is deemed to
begin at the beginning of the day following the Closing Date, (b) exemptions,
allowances, or deductions that are calculated on an annual basis (including
depreciation and amortization deductions) shall be allocated between the period
ending on the Closing Date and the period after the Closing Date in proportion
to the number of days in each such period, and (c) in the case of any Tax
imposed upon the ownership or holding of real or personal property, such Taxes
shall be prorated based on the percentage of the actual period to which such
Taxes relate that precedes the Closing Date.

(g)                                 All Tax Returns that Buyer is required to
prepare or cause to be prepared in accordance with this Section 11.2 shall be
prepared in a manner consistent with past practice and, on such Tax Returns, no
positions shall be taken, elections made, or method adopted that is inconsistent
with positions taken, elections made, or methods used in preparing and filing
similar Tax Returns in prior periods (including, but not limited to, positions
that would have the effect of accelerating income to periods for which Seller is
liable or deferring deductions to period for which Buyer is liable).

(h)                                 Seller shall be entitled to any credits,
rebates, or refunds of Taxes of Kenkev payable with respect to any Pre-closing
Tax Period of Kenkev and, with respect to any Straddle Period, the portion of
the Straddle Period ending on and including the Closing Date. Buyer shall cause
the amount of the credits, rebates, or refunds of Taxes to which Seller is
entitled under this Section 11.2(h), but which were received by or credited to
Kenkev after the Closing Date, to be paid to Seller within 10 Business Days
following such receipt or crediting. Buyer shall send written notice to Seller
of any such credit, rebate, or refund as soon as possible after Buyer becomes
aware of them.

(i)                                     Buyer and Seller shall cooperate with
one another with respect to Tax matters as more fully set forth in this Section
11. Buyer and Seller shall cooperate fully as and to the extent reasonably
requested by the other party, at the other party’s expense, in connection with
the filing of Tax Returns pursuant to this Section 11 and any audit, litigation,
or other proceeding with respect to Taxes. Such cooperation shall include the
retention and (upon the other party’s request and at the other party’s
expense)the provision of records and information that are reasonably relevant to
any such Tax Return, audit, litigation, or other proceeding and making employees
available on a mutually convenient basis to provide additional information and
explanation of any material provided

26

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hereunder. Buyer and Seller agree (i) to retain all books and records with
respect to Tax matters pertinent to Kenkev relating to any taxable period
beginning before the Closing Date until the expiration of the statute of
limitations (and, to the extent notified by Buyer or Seller, any extensions
thereof) of the respective taxable periods, and to abide by all record retention
agreements entered into with any taxing authority, and (ii) to give the other
party reasonable written notice before transferring, destroying, or discarding
any such books and records and, if the other party so requests, Buyer or Seller
, as the case may be, shall allow the other party to take possession of such
books and records to the extent they would otherwise be destroyed or discarded.

11.3                           Certificate of Nonforeign Status. Each of the
Seller and Seller Equityholder shall deliver to Buyer at the Closing a
certificate of nonforeign status (the “Certificate of Nonforeign Status”) in
accordance with Treasury Regulation Section 1.1445-2(b)(2).

12.                                 Expenses. Each of the parties shall pay all
of the costs that it incurs incident to the preparation, execution, and delivery
of this Agreement and the performance of any related obligations, whether or not
the transactions contemplated by this Agreement shall be consummated, and Seller
Equityholders shall pay all of the cost and expenses incurred by Seller.

13.                                 Termination.

13.1                           This Agreement may be terminated at any time
before the Closing Date as follows:

(a)                                  By Buyer and Seller in a written
instrument.

(b)                                 By Buyer or Seller if the Closing does not
occur on the Closing Date or within a reasonable time thereafter.

(c)                                  By Buyer or Seller if there shall have been
a material breach of any of the representations or warranties set forth in this
Agreement on the part of the other, and this breach by its nature cannot be
cured before the Closing.

(d)                                 By Buyer or Seller if there has been a
breach of any of the covenants or agreements set forth in this Agreement on the
part of the other, and this breach is not cured within 10 Business Days after
the breaching party or parties receive written notice of the breach from the
other party.

13.2                           If terminated as provided in Section 13.1, this
Agreement shall forthwith become void and have no effect, except for Sections
13.3 and 14, and except that no party shall be relieved or released from any
liabilities or damages arising out of the party’s breach of any provision of
this Agreement.

13.3                           Buyer and VCG Holding Corporation, jointly and
severally, on the one hand, and the Seller and Seller Equityholder, jointly and
severally, on the other, agree that if this Agreement is terminated, each party
will not (and, in the case of Seller, shall cause KenkevII to not), during the
one-year period following the termination,

27

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directly or indirectly solicit any employee of the other party to leave the
employment of the other party.

14.                                 Miscellaneous Provisions.

14.1                           Representations and Warranties. All of  the
representations and warranties made by the Buyer and Seller pursuant to this
Agreement shall survive the consummation of the transactions contemplated by
this Agreement, except for those specifically terminated at closing by this
Agreement.

14.2                           Notices. All notices, demands, and requests
required or permitted to be given under the provisions of this Agreement shall
be in writing and shall be deemed given (a) when personally delivered or sent by
facsimile transmission to the party to be given the notice or other
communication or (b) on the business day following the day such notice or other
communication is sent by overnight courier to the following:

if to Seller Equityholders:

Mr. Ken Wood

St. Croix, USVI

With a Copy to:

 

Mr. Harry T. Heizer, Esq.

6300 St. Andrews Road, Suite C

Columbia, South Carolina 29212

Facsimile: (803) 750-6457

if to Buyer:

 

Troy Lowrie

VCG Holding Corp.

390 Union St., Suite 540

Lakewood, CO  80228

Facsimile: (303) 922-0746

and

Michael L. Ocello

VCG Holding Corp.

1401 Mississippi Avenue, #10

Sauget, IL 62201

Facsimile: (681) 271-8384

28

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With a Copy to

Allan S. Rubin, Esq.

Draper, Rubin & Shulman, P.L.C.

29800 Telegraph Road

Southfield, Michigan 48034

Facsimile: 248-358-9729

or to such other address or facsimile number that the parties may designate in
writing.

14.3                           Assignment. Neither Seller Equityholder nor
Seller, on one hand,  nor VCG Holding Corporation or Buyer, on the other, shall
assign this Agreement, or any interest in it, without the prior written consent
of the other, except that VCG Holding Corporation may assign any or all of its
rights to any wholly owned subsidiary of VCG Holding Corporation, without
Seller’s or Seller Equityholder’s consent. In no event shall consent be
unreasonably withheld.

14.4                           Parties in Interest and Expenses. This Agreement
shall inure to the benefit of, and be binding on, the named parties and their
respective successors and permitted assigns, but not any other person or entity.
Each party to this agreement shall be responsible for there own costs, expenses,
and professional fees relating to this agreement.

14.5                           Choice of Law. This Agreement shall be governed,
construed, and enforced in accordance with the laws of the State of Maine.

14.6                           Counterparts/Fax Signatures. This Agreement may
be signed in any number of counterparts with the same effect as if the signature
on each counterpart were on the same instrument. Fax signatures shall have the
same force and effect as originals.

14.7                           Entire Agreement. This Agreement and all related
documents, schedules, exhibits, or certificates represent the entire
understanding and agreement between the parties with respect to the subject
matter and supersede all prior agreements or negotiations between the parties.
This Agreement may be amended, supplemented, or changed only by an agreement in
writing that makes specific reference to this Agreement or the agreement
delivered pursuant to it, and must be signed by the party against whom
enforcement of any such amendment, supplement, or modification is sought. The
terms of the Letter Agreement dated June 9, 2007 and attached hereto as Schedule
14.7 are incorporated herein. To the extent that any provision of the Letter
Agreement contradicts any provision of this Agreement, then this Agreement shall
control.

14.8                        Buyer and Seller agree that this Agreement
memorializes their binding agreement and intent, as set forth in the Letter of
Intent dated July 9, 2007 as “Schedule 14.7”.  However, both Buyer and Seller
acknowledge and agree that there may be need for minor revisions to minor terms
of the Agreement.  Buyer and Seller agree that they will in good faith cooperate
with each other to modify or amend this Agreement as may be necessary to
accomplish the binding  intent of the parties.  Any change that the Buyer or
Seller might request shall be approved by Buyer and Seller, acting in good
faith, prior to closing.  In the event the Buyer and Seller are unable to agree
and the requested change is not a material item or

29

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material issue, the closing shall be completed on the closing date and the issue
shall be resolved by arbitration in accordance with the laws of the State of
Maine.

The parties have executed this Agreement on the date set forth on the first page
of this Agreement.

 

KENKEV, INC.

 

 

 

/s/

  Gregory Kenwood Gaines

 

 

 

By: Gregory Kenwood Gaines

 

 

Its: President

 

 

 

 

 

 

 

K & R PROPERTIES, INC.

 

 

 

/s/

  Gregory Kenwood Gaines

 

 

By: Gregory Kenwood Gaines

 

Its: President

 

 

 

 

 

SELLER EQUITYHOLDER

 

 

 

/s/

Gregory Kenwood Gaines

 

 

 

 

 

 

BUYER: VCG HOLDING

 

CORPORATION

 

 

 

By: 

/s/ Troy Lowrie

 

 

Its:

     CEO

 

 

30

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EXHIBIT 2.3b

Pre-Paid Items -NONE

(To be supplied by Seller Equityholders)

31

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EXHIBIT 2.4

Purchase Price Allocation/Payment

32

--------------------------------------------------------------------------------

 

PAYEE

 

AMOUNT

 

Gregory Kenwood Gaines \ Seller Equityholder

 

$

4,950,000

 

 

 

 

 

Alliance Management Partners, LLC KW Division

 

500,000

 

 

33

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EXHIBIT 2.8

BALANCE SHEET AND PHYSICAL INVENTORY

KENKEV, INC.

INCOME STATEMENT

STATEMENT OF ASSETS AND LIABILITIES ENDED

SALES

 

 

 

SALES BEVERAGES

 

$

2,085,814.64

 

ADMISSIONS

 

156,501.00

 

OTHER INCOME

 

615,953.64

 

TOTAL SALES

 

2,858,269.28

 

 

 

 

 

COST OF GOODS SOLD

 

 

 

PURCHASES – BEVERAGES

 

542,566.69

 

PURCHASES – SUPPLIES

 

95,498.46

 

PURCHASES – FASHION

 

17,845.84

 

TOTAL COST OF GOODS SOLD

 

855,910.99

 

GROSS PROFIT

 

2,202,358.29

 

 

 

 

 

OPERATING EXPENSES

 

 

 

ADVERTISING

 

147,633.00

 

ADMINISTRATIVE SERVICES

 

1,064,049.82

 

CREDIT CARDS

 

28,385.79

 

DUES AND SUBSCRIPTIONS

 

458.67

 

BANK CHARGES

 

51,799.38

 

CLEANING

 

15,816.21

 

COMMISSIONS

 

10,765.00

 

EQUIPMENT RENTAL

 

1,821.45

 

INSURANCE

 

23,923.26

 

HEALTH INSURANCE

 

(2,554.04

)

LAWN CARE

 

100.00

 

LICENSES & PERMITS

 

1,584.34

 

MUSIC & ENTERTAINERS

 

4,590.00

 

OFFICE EXPENSES

 

2,333.75

 

OUTSIDE SERVICES

 

10,132.95

 

PAYROLL EXPENSE

 

342,892.68

 

LAWN SERVICE

 

2,500.00

 

PAYROLL TAXES

 

98,444.94

 

PRINTING

 

3,112.22

 

PROFESSIONAL FEES

 

61,762.65

 

RENT

 

158,909.19

 

SUPPLIES

 

22,938.74

 

REPAIRS & MAINTENANCE

 

26,354.66

 

SECURITY

 

454.80

 

TAXES – LOCAL

 

6,070.30

 

TAXES – STATE

 

25.00

 

TELEPHONE

 

3,493.79

 

TRASH REMOVAL

 

3,257.29

 

TRAVEL

 

600.00

 

UNIFORMS

 

(2,119.00

)

UTILITIES – GAS & ELECTRIC

 

40,825.68

 

UTILITIES – WATER

 

17,787.36

 

UTILITIES – CABLE

 

1,597.42

 

DEPRECIATION

 

7,226.08

 

AMORTIZATION

 

58,666.64

 

TOTAL OPERATING EXPENSES

 

2,215,740.02

 

 

 

 

 

NET INCOME (LOSS)

 

$

(13,381.73

)

 

[PAGE STAMPED “DRAFT” AND INITIALED IN LEFT-HAND CORNER]

See Accountants’ Compilation Report

34

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KENKEV, INC.

BALANCE SHEET

AS OF AUGUST 31, 2007

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES

 

 

 

CHECKS IN EXCESS OF BANK BALANCE

 

$

48,774.72

 

CHILD SUPPORT PAYABLE

 

312.87

 

BANK OF AMERICA – LOC

 

6,634.45

 

 

 

 

 

TOTAL CURRENT LIABILITIES

 

55,722.04

 

 

 

 

 

LONG-TERM LIABILITIES

 

 

 

 

 

 

 

TOTAL LIABILITIES

 

55,722.04

 

 

 

 

 

STOCKHOLDERS’ EQUITY

 

 

 

CAPITAL STOCK

 

393,151.00

 

RETAINED EARNINGS

 

305,125.11

 

CURRENT INCOME

 

(13,381.73

)

 

 

 

 

TOTAL STOCKHOLDERS’ EQUITY

 

684,894.38

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

 

$

740,616.42

 

 

[PAGE STAMPED “DRAFT” AND INITIALED IN LEFT-HAND CORNER]

See Accountants’ Compilation Report

35

--------------------------------------------------------------------------------

KENKEV, INC.

BALANCE SHEET

AS OF AUGUST 31, 2007

ASSETS

CURRENT ASSETS

 

 

 

CASH ON HAND

 

$

5,000.00

 

CASH – FASHION

 

344.48

 

CASH – PAYROLL

 

1,397.42

 

CASH – CREDIT CARD

 

24,212.70

 

EXCHANGE

 

175,074.32

 

 

 

 

 

TOTAL CURRENT ASSETS

 

206,028.92

 

 

 

 

 

PREPAID TAXES

 

 

 

PREPAID TAXES – FEDERAL

 

6,550.00

 

PREPAID TAXES – STATE

 

3,035.00

 

 

 

 

 

TOTAL PREPAID TAXES

 

9,585.00

 

 

 

 

 

PROPERTY AND EQUIPMENT

 

 

 

FURNITURE & EQUIPMENT

 

174,446.12

 

LEASEHOLD IMPROVEMENTS

 

42,316.00

 

SIGNS

 

10,393.10

 

ACCUM DEPN – FURN & EQUIP

 

(169,351.16

)

ACCUM DEPN – LEASEHOLD IMP

 

(15,898.48

)

ACCUM DEPN – SIGNS

 

(10,094.44

)

 

 

 

 

NET PROPERTY AND EQUIPMENT

 

31,811.14

 

 

 

 

 

OTHER ASSETS

 

 

 

DEPOSITS

 

1,150.00

 

GOODWILL

 

600,000.00

 

ACCUM AMORT – GOODWILL

 

(268,666.64

)

ACCOUNTS RECEIVABLE STOCKHOLDER

 

20,000.00

 

NOTE RECEIVABLE KEN WOOD

 

140,708.00

 

 

 

 

 

 TOTAL OTHER ASSETS

 

493,191.36

 

 

 

 

 

TOTAL ASSETS

 

$

740,616.42

 

 

[PAGE STAMPED “DRAFT” AND INITIALED IN LEFT-HAND CORNER]

See Accountants’ Compilation Report

36

--------------------------------------------------------------------------------

(To be supplied by Seller Equityholders)

EXHIBIT 3.1

NON-COMPETITION AGREEMENT  -DONE
Confidentiality Agreement

37

--------------------------------------------------------------------------------

EXHIBIT 3.4

PROPOSED LEASE -DONE

38

--------------------------------------------------------------------------------

SCHEDULE 5.3

DUE DILIGENCE LIST -DONE

39

--------------------------------------------------------------------------------

SCHEDULE 8.2

KEN-KEV, Inc, and KenkevII, Inc.

ARTICLES OF INCORPORATION AND BY-LAWS

(To be supplied by Seller Equityholders)

DONE

40

--------------------------------------------------------------------------------

SCHEDULE 8.3

KEN-KEV, Inc. and KenkevII, Inc.

SHAREHOLDERS AND STOCK CERTIFICATE NUMBERS

(To be supplied by Seller Equityholders)

DONE

41

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SCHEDULE 8.6

GOVERNMENTAL AND SHAREHOLDER APPROVALS

(To be supplied by Seller Equityholders)

42

--------------------------------------------------------------------------------

1.             Governmental Approvals

a.               The Maine Alcoholic Beverage Commission – Transfer of Liquor
Licenses and Permits

b.               City of Portland – Adult Entertainment Licenses

2.             Shareholder Approvals    DONE

A.            Ken Wood

43

--------------------------------------------------------------------------------

SCHEDULE 8.9

Licenses and Permits

(To be supplied by Seller Equityholders)

WAIVED

44

--------------------------------------------------------------------------------

SCHEDULE 8.10

FINANCIAL INFORMATION

(To be supplied by Seller Equityholders)

45

--------------------------------------------------------------------------------

SCHEDULE 8.11

UNDISCLOSED LIABILITIES  -NONE

(To be supplied by Seller Equityholders)

46

--------------------------------------------------------------------------------

SCHEDULE 8.12

CHANGES IN ORDINARY COURSE OF BUSINESS  -NONE

(To be supplied by Seller Equityholders)

47

--------------------------------------------------------------------------------

SCHEDULE 8.13

ADVERSE CHANGES TO BUSINESS -NONE

(To be supplied by Seller Equityholders)

48

--------------------------------------------------------------------------------

SCHEDULE 8.15

EMPLOYEE BENEFIT PLANS -NONE

(To be supplied by Seller Equityholders)

49

--------------------------------------------------------------------------------

SCHEDULE 8.16

LIST OF EMPLOYEES AND INDEPENDENT CONTRACTORS

50

--------------------------------------------------------------------------------

SCHEDULE 8.16(C)

For purposed of Paragraph 8.16(c), the following persons are identified as
managers and their present salaries are as follows:

Name

 

Weekly Salary

 

Yearly Salary

1.

 

Shawn Smetana

 

$

2,900.00

 

 

 

 

 

 

 

 

 

2.

 

Mike St. Peter

 

$

2,700.00

 

 

 

 

 

 

 

 

 

3.

 

Chad Burnett

 

$

2,250.00

 

 

 

 

 

 

 

 

 

4.

 

Adam Currier

 

$

1,600.00

 

 

 

(To be supplied by Seller Equityholders)

51

--------------------------------------------------------------------------------

SCHEDULE 8.17

Assumed Contracts

SCHEDULE 8.17

1.             Video Games- 50/50 Split on Video Games with Sparta Vending

2.                                       Red Bull- Written Contract for 3 years
expiring at the end of 2008. $2,000 Payment is due to KenkevII at the beginning
of 2008. Deal provides for 1 case free with every 7 purchased.

3.                                       Verbal Agreement with National
Distributors to keep Bud Light on tap for Monday Night Football. The agreement
is a 3 year agreement, with one year remaining. A payment is due KenKevII in the
amount of $6,000.00 at the beginning of 2008.

4.                                       Victor Coffee- Verbal agreement to
purchase coffee exclusively, in exchange for providing and maintaining the
grinder and coffee maker located in kitchen.

5.                                       Coca Cola- Verbal Agreement to only use
Coke products in return for the supplying and maintenance of dispensing
equipment.

6.                                       Certain advertising contracts.

52

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[HAND-WRITTEN TEXT:  “8.17”]

[“Intelligent advertising inc.” LOGO APPEARED ON ORIGINAL HARD COPY]

Intelligent Advertising Inc.

763 E Brookhaven Circle

Ste 205

Memphis, TN 38117

 

KWE GROUP

Bill to:

 

800 Bush River Rd

 

 

Columbia, SC 29210

 

 

 

Invoice Number

 

PPP306

 

 

 

Invoice Date

 

9/12/07

 

 

 

Media Schedule for Week of :9.3-9.9

 

 

 

WBLM Sched + MNF

 

$1299.11 This runs through Dec 31 and is a weekly schedule plus MNF remote and
talent fees

 

 

 

WJAB SPORTS

 

$250.00

 

 

 

WCYY Sche + MNF

 

$1299.11 This runs through Dec 31 and is a weekly schedule plus MNF remote and
talent fees

 

 

 

PORTLAND PRESS

 

$1122.00 This is a 6 day a week run that runs thru January 2008. It is usually a
2x3 or 2x4

 

 

 

TIME WARNER

 

$425.00 This is TV advertising that runs through Jan 23, 2008

 

 

 

CLASSIFIED

 

$0.00

 

 

 

PRODUCTION

 

$125.00

 

 

 

PORTLAND PHOENIX

 

$0.00

 

 

 

Qremotefor Millennium

 

$1150 (2 of 3 payments)

 

Remittance

Total Due:     $5670.22  A normal run of schedule is around $ 4500 per week...

Paid:

Date:

[TWO SETS OF INITIALS APPEAR IN RIGHT-HAND CORNER]

53

--------------------------------------------------------------------------------

CONTRACTS AND COMMITMENTS

(To be supplied by Seller Equityholders)

54

--------------------------------------------------------------------------------

SCHEDULE 8.18

ASSETS NOT OWNED BY SELLER USED IN BUSINESS

(To be supplied by Seller Equityholders)

SEE  8.17

55

--------------------------------------------------------------------------------

SCHEDULE 8.22

TAX DISCLOSURES

(To be supplied by Seller Equityholders)

WAIVED

56

--------------------------------------------------------------------------------

SCHEDULE 8.25

ENVIRONMENTAL DISCLOSURES

(To be supplied by Seller Equityholders)

WAIVED

57

--------------------------------------------------------------------------------

SCHEDULE 8.27

SUPPLIERS, VENDORS, AND CUSTOMERS

(To be supplied by Seller Equityholders)

WAIVED

58

--------------------------------------------------------------------------------

SCHEDULE 8.27a

VIP CUSTOMERS

(To be supplied by Seller Equityholders)

NONE

59

--------------------------------------------------------------------------------

SCHEDULE 8.29

INSIDER TRANSACTIONS

(To be supplied by Seller Equityholders)

NONE

60

--------------------------------------------------------------------------------

SCHEDULE 8.30

BANK ACCOUNTS

(To be supplied by Seller Equityholders)

WAIVED

61

--------------------------------------------------------------------------------

SCHEDULE 8.31

INTELLECTUAL PROPERTY

(To be supplied by Seller Equityholders)

NONE

62

--------------------------------------------------------------------------------

SCHEDULE 8.32

INSURANCE

(To be supplied by Seller Equityholders)

SATISFIED

63

--------------------------------------------------------------------------------

SCHEDULE 14.7

Letter Agreement dated June 9, 2007

WAIVED

64

--------------------------------------------------------------------------------