Loan
      Contract

    


    between

    KINGS
      ROAD ENTERTAINMENT EUROPE GmbH

    Rosenheimerstr.
      8

    D-81669
      Munich, Germany

    -
      hereafter “Borrower”

    and

    KINGS
      ROAD ENTERTAINMENT INC

    468
      N. Camden Drive

    Beverly
      Hills, CA 90210, USA

    -
      hereafter „Lender“

    
 

    §1

    Granting
      of a Loan

     

    
      	
              1.1

            	
              The
                Lender herewith lends to the Borrower a loan of up to US$
                70,000 (Seventy-thousand)

            
	 	 
	
              1.2

            	
              The
                loan will be paid out to Borrower in instalments and subject to submitted
                budgets, such budgets subject to approval by Lender. 

            
	 	 
	
              1.3

            	
              The
                Borrower must submit its budget for approval a minimum of 30 days
                prior to
                loan requirement. The Lender will approve or disapprove of the budget
                and
                loan request within 10 days and inform the Borrower
                accordingly.

            


    

     

    §2

    Interest
      / Exchange Risk

     

    
      	
              2.1

            	
              The
                paid out amounts of the loan will bear interest initially at 8%
                p.a.

            
	 	 
	
              2.2

            	
              The
                interest will be calculated and accrued on a 365/365 basis and added
                to
                the

              principle
                annually at the end of each calendar year.

            
	 	 
	
              2.3

            	
              The
                exchange rate risk (gain or loss) will be borne solely by the
                Borrower.

            


    

     

    §3

    Repayment

     

    
      	
              3.1


            	The loan has
              a
              preliminary term until December 31st
              2010.
	 	 
	
              3.2

            	
              The
                loan is to be repaid in one amount at the end of the term unless
                the
                subordinated character of the loan does not permit this, in which
                case the
                parties may extend the term by mutual consent. 

            
	 	 
	
              3.3


            	
              Pre-maturity
                repayment amounts (in total or in instalments of $5,000) of the loan
                are
                possible at any time without pre-maturity compensation. The Borrower
                is
                not entitled to demand the re-lending of previously repaid loan
                amounts.

            


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    §4

    Subordination

    


    The
      Loan
      is unsecured. The loan is subordinated. Repayment of this loan ranks below
      all
      other debt of the Borrower. 

    


    §5

    Effective
      Date, Termination

     

     

    
      
        	
                5.1

              	
                This
                  contract becomes valid upon signing.

              
	 	 
	
                5.2

              	The
                Lender
                is under no obligation to accept budget submissions by the
                Borrower.
	 	 


      

    

     

    §6

    Escape
      Clause

    


    Should
      certain provisions in this contract be or become invalid or impracticable,
      then
      the validity of the remaining provisions will not be affected. The invalid
      or
      impracticable provision will be replaced by a valid or practicable provision
      that most closely represents the original commercial intent of the invalid
      or
      impracticable provision. The same applies to supplemental interpretations of
      the
      contract. 

     

    
      	 	Los Angeles/Munich	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	Signed by  	Signed
              by
	 	 	 
	 	 	 
	 	 	 
	 	                                                                  	                                                                
              
	 	Lender 	Borrower