**Exhibit 10.11**

 

**DATED                    8 OCTOBER 2009**

** **

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**FACILITYAGREEMENT**

** **

between

 

**MGT CAPITALINVESTMENTS LIMITED**

** **

and

 

**MONEYGATEGROUP LIMITED**

 

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**THIS AGREEMENT** is dated                                           2009

 

**PARTIES**

** **

(1)           **MGTCAPITAL INVESTMENTS****LIMITED**incorporated and registered in England and Wales with company number 07034382whose registered office is at 66 Hammersmith Road, London, W14 8UD (**Lender**).

 

(2)           **MONEYGATE GROUP LIMTIED** incorporated and registered inEngland and Wales with company number 06599555 whose registered office is at 1The Bulrushes Woodstock Way Boldon Business Park Boldon Colliery Tyne &Wear NE35 9PF (**Borrower**).

 

**BACKGROUND**

** **

TheLender has agreed to provide the Borrower with a secured term loan facility of£2,000,000.

 

**AGREED TERMS**

** **

# **1.**             DEFINITIONS AND INTERPRETATION

# ** **

## 1.1           The definitions and rules ofinterpretation in this clause apply in this agreement.

##  

**AvailabilityPeriod****:** the period beginning with the Effective Date and ending on andincluding the date three years after the Effective Date.

 

**BusinessDay****:** a day (other than a Saturday or a Sunday) on which commercial banksare open for general business in London and deposits are dealt with on theLondon Interbank Market.

 

**Change ofControl****:** where any person, or group of connected persons not having control(as defined in section 416 of ICTA 1988) of the Borrower on the date of thisagreement acquires control of the Borrower; or

 

**Debenture****:** a debenture in theagreed form executed, or to be executed, by the Borrower.

 

**Director****:** each person who is adirector of the Borrower

 

**Disclosed****:** has the meaning setout in the Subscription Agreement

 

**DisclosureLetter****:** the disclosure letter from the Warrantors to the Lender (as definedin the Subscription Agreement)

 

**Drawdown****:** a drawing made, orto be made, by the Borrower under the Facility.

 

**DrawdownDate****:** the date on which an Advance is made, or is to be made.

 

**DrawdownRequest****:** a drawdown request, substantially in the form set out in Schedule2.

 

**EffectiveDate****:** the date of this agreement.

 

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**Event ofDefault****:** any event or circumstance listed in Schedule 5.

 

**ExistingSecurity****:** any Security arising under:

 

### (a)        theDebenture;

###  

### (b)        anySecurity created or outstanding with the Lender’s prior written consent;

###  

### (c)        anySecurity securing not more than £25,000 in total at any time;

###  

### (d)        anycommon law liens in the ordinary course of trading, as long as the amounts inrespect of those liens are not overdue for payment;

###  

### (e)        anynormal title retention arrangements of a supplier’s standard conditions ofsupply of goods acquired by the Borrower in the ordinary course of itsbusiness.

###  

**Facility****:** the term loanfacility made available under this agreement.

 

**Indebtedness****:** any obligation topay or repay money, present or future, whether actual or contingent, sole orjoint.

 

**MaterialAdverse Effect****:** any event or circumstance which, in the Lender’s reasonableopinion, is likely to materially and adversely affect the Borrower’s ability toperform all or any of its obligations under, or otherwise comply with, theterms of the Transaction Documents or any of them.

 

**PotentialEvent of Default****:** any event or circumstance specified in Schedule 5 which would, onthe giving of notice, expiry of any grace period or making of any determinationunder this agreement, become an Event of Default.

 

**RepaymentDate****:** the date three years from the Effective Date or upon the Lenderceasing to be a shareholders of the Borrower, whichever is the sooner.

 

**Security****:** any mortgage, charge(whether fixed or floating, legal or equitable), pledge, lien, hypothecation,assignment as security, title retention or any other type of arrangement thathas a similar effect to any of them.

 

**Subscription Agreement:** the agreement between the Lender, the Borrower and the Warrantorsof even date

 

**Subsidiary****:** a subsidiary withinthe meaning of a subsidiary undertaking within the meaning of section 1162 ofthe Companies Act 2006.

 

**TransactionDocuments****:** this agreement and the Debenture.

 

**Warranties****:** the representationsand warranties set out in Schedule 3.

 

**Warrantors**: has the meaning set out in the Subscription Agreement

 

## 1.2           Clause, schedule andparagraph headings do not affect the interpretation of this agreement.

##  

## 1.3           A reference to **this agreement** (or any provision of it) or any otherdocument shall be construed as a reference to this agreement, that provision orthat document as it is in 

 

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## force for the time beingand as amended, varied or supplemented from time to time in accordance with itsterms, or with the agreement of the relevant parties.

##  

## 1.4           A reference to a **person** shall include a reference to an individual, firm,company, corporation, unincorporated body of persons, or any state or any agencyof that person).

##  

## 1.5           A reference to a statute,statutory provision or subordinate legislation is a reference to it as it is inforce for the time being, taking account of any amendment or extension, orre-enactment and includes any former statute, statutory provision orsubordinate legislation which it amends or re-enacts.

##  

## 1.6           A reference to **writing** or **written**includes faxes but not e-mail.

##  

# **2.**             THE FACILITY

# ** **

The Lender grants to the Borrower a secured sterlingterm loan facility of a total principal amount of £2,000,000 on the terms, andsubject to the conditions, of this agreement.

 

# **3.**             PURPOSE

# ** **

## 3.1           The Borrower shall useall money borrowed under this agreement for acquisitions of IFA Targets as maybe approved by the Lender in writing such approval not to be unreasonablywithheld or delayed.

##  

# **4.**             CONDITIONS PRECEDENT

# ** **

## 4.1           The Borrower may onlymake a Drawdown Request, and the obligations of the Lender under this agreementonly arise, once the Lender has received all the documents and evidencespecified in Schedule 1 in the form and containing the information, that itrequires

##  

## 4.2           The Lender’s obligationto make an Advance is subject to the condition precedent that, on both the dateof the Drawdown Request and the Drawdown Date:

##  

### (a)        Warrantiesare true and correct in all material respects and will be true and correct inall material respects immediately after the Borrower has made the proposedDrawing, subject to the dispute which is currently in existence between theBorrower and Money Portal (in administration) as more fully described in thedisclosure against Warranty 7.1(a) in the Disclosure Letter; and

###  

### (b)        no Eventof Default or Potential Event of Default is continuing, or would result fromthe proposed Drawing

 

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## 4.3           The Lender may, in itsabsolute discretion, refuse to approve a Drawdown Request

##  

## 4.4           The conditions specifiedin this clause 4 are inserted solely for the Lender’s benefit. The Lender maywaive them, in whole or in part and with or without conditions, withoutprejudicing the Lender’s right to require subsequent fulfilment of suchconditions.

##  

# **5.**             INTEREST

# ** **

## 5.1           The Borrower shall payinterest on each Drawdown at the rate of 5% per annum.

##  

## 5.2           Interest shallaccrue daily and shall be debited and compounded monthly****andshall be payable on each anniversary of the first draw down against thefacility.

##  

## 5.3           If the Borrower fails tomake any payment due under this agreement on the RepaymentDate, interest on the unpaid amount shall accrue daily,from the date of non-payment to the date of actual payment, at 7% p.a.

##  

# **6.**             REPAYMENT

# ** **

## 6.1           The Borrower shall repaythe Loan on the Repayment Date.

##  

## 6.2           The Borrower may repaythe Loan earlier than the Repayment Date without penalty.

##  

# **7.**             CHANGE OF CONTROL

# ** **

## 7.1           The Borrower shallpromptly notify the Lender if:

##  

(a)        there isa Change of Control, or

 

(b)        theBorrower becomes aware of circumstances that may result in a Change of Control.

 

## 7.2           If the Borrower notifiesthe Lender under paragraph 7.1 the Lender may cancel the Facility and declarethe Loan Balance, accrued interest and all other amounts due under thisagreement immediately due and payable. To do this, the Lender must give theBorrower at least 14 days’ notice.

##  

# **8.**             REPRESENTATIONS AND WARRANTIES

# ** **

## 8.1           The Borrower makes theWarranties on the date of this agreement.

##  

## 8.2           The Borrower repeats theWarranties on each Drawdown Date by reference to the facts and circumstancesexisting on each such date.

 

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## 8.3           The Borrower covenantswith the Lender as set out in Schedule 4.

##  

## 8.4           The covenants given bythe Borrower shall remain in force from the date of this agreement for so longas any amount remains outstanding or any Commitment is in force under thisagreement.

##  

# **9.**             EVENTS OF DEFAULT

# ** **

## 9.1           Each of the events orcircumstances set out in Schedule 5 is an Event of Default.

##  

## 9.2           At any time after anEvent of Default has occurred and is continuing, the Lender may, by givingnotice to the Borrower declare the loan balance accrued interest and all otheramounts accrued or outstanding under the Transaction Documents:

##  

### (a)        immediatelydue and payable; or

###  

### (b)        payableon demand.

###  

# **10.**          CALCULATIONS, ACCOUNTS AND CERTIFICATES

# ** **

## The Lender shall maintain accounts evidencing the amountthe Borrower owes it. Entries in those accounts shall be prima facie evidenceof the existence and amount of the Borrower’s obligations as recorded in them.

##  

# **11.**          REMEDIES, WAIVERS, AMENDMENTS ANDCONSENTS

# ** **

## 11.1         Any amendment to thisagreement shall be in writing and signed by, or on behalf of, each party.

##  

## 11.2         Any waiver of any rightor consent given under this agreement is only effective if it is in writing andsigned by the waiving or consenting party. It shall apply only in thecircumstances for which it is given and shall not prevent the party giving itfrom subsequently relying on the relevant provision.

##  

## 11.3         No delay or failure toexercise any right under this agreement shall operate as a waiver of thatright.

##  

## 11.4         No single or partialexercise of any right under this agreement shall prevent any further exerciseof that right (or any other right under this agreement).

##  

## 11.5         Rights and remedies underthis agreement are cumulative and do not exclude any other rights or remediesprovided by law or otherwise.

 

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# **12.**          SEVERANCE

# ** **

## 12.1         The invalidity,unenforceability or illegality of any provision (or part of a provision) ofthis agreement under the laws of any jurisdiction shall not affect thevalidity, enforceability or legality of the other provisions.

##  

## 12.2         If any invalid,unenforceable or illegal provision would be valid, enforceable and legal ifsome part of it were deleted, the provision shall apply with whatevermodification as is necessary to give effect to the commercial intention of theparties.

##  

# **13.**          COUNTERPARTS

# ** **

This agreement may be executed and delivered in anynumber of counterparts, each of which is an original and which, together, havethe same effect as if each party had signed the same document.

 

# **14.**          THIRD PARTY RIGHTS

# ** **

A person who is not a party to this agreement cannotenforce, or enjoy the benefit of, any term of this agreement under theContracts (Rights of Third Parties) Act 1999.

 

# **15.**          NOTICES

# ** **

## 15.1         Each notice, request,demand or other communication under this agreement shall be:

##  

### (a)        inwriting, delivered personally or sent by pre-paid first-class letter or fax(confirmed by letter); and

###  

### (b)        sent:

###  

#### (i)         to theLender at: 66 Hammersmith Road, London, W14 8UD

####  

Fax: 02076057951

 

Attention: Tim Paterson-Brown

 

#### (ii)        to theBorrower at: 1 The Bulrushes Woodstock Way Boldon Business Park Boldon CollieryTyne & Wear NE35 9PF

####  

Attention: Dennis Reed

 

or to any other addresses or fax numbers that arenotified by one party to the other.

 

## 15.2         Any notice or othercommunication given by the Lender shall be deemed to have been received:

##  

### (a)        if sentby fax, with a confirmation of transmission, on the day on which it istransmitted;

 

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### (b)        if given byhand, on the day of actual delivery; and

###  

### (c)        ifposted, on the second Business Day following the day on which it was despatchedby pre-paid first-class post.

###  

## 15.3         A notice given asdescribed in clause 15.2(a) or clause 15.2(b) on a day which is not aBusiness Day (or after normal business hours in the place of receipt) shall bedeemed to have been received on the next Business Day.

##  

## 15.4         Any notice or othercommunication given to the Lender shall be deemed to have been given only onactual receipt by the Lender.

##  

# **16.**          GOVERNING LAW AND JURISDICTION

# ** **

## 16.1         This agreement and anydispute or claim arising out of or in connection with it or its subject matteror formation (including non-contractual disputes or claims) shall be governedby, and construed in accordance with, the law of England and Wales.

##  

## 16.2         The parties to thisagreement irrevocably agree that the courts of England and Wales shall haveexclusive jurisdiction to settle any dispute or claim that arises out of or inconnection with this agreement or its subject matter or formation (includingnon-contractual disputes or claims).

##  

Thisagreement has been entered into on the date stated at the beginning of it.

 

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**Schedule 1**    Conditionsprecedent

** **

**1.**             OTHER DOCUMENTS

** **

Delivery of the following documents and evidence:

 

(c)        theDebenture in the agreed form, duly executed by the Borrower;

 

(d)        certifiedcopies of deeds of release for all outstanding security interests (other thanExisting Security) granted by the Borrower; and

 

(e)        certifiedcopies of any powers of attorney under which any party (other than the Lender)may execute the Transaction Documents.

 

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** **

**Schedule 2**    Form ofDrawdown Request

 
| To:        |   | The  Lender |
|------------|--------|-------------|
| Attention: |   | [NAME]      |
| Date:      |   | [DATE]      |

 

**[NAME OF BORROWER]**

 

**£[AMOUNT] Facility Agreement[DATE] between [Parties]**

 

This is a Drawdown Request made under thefacility agreement referred to above. Words and expressions defined in thatagreement have the same meanings in this Drawdown Request.

 

[We enclose with this Drawdown Request aBusiness Plan and the Accounts for your consideration and approval].

 

We give you notice that we wish to drawdown the following Advance on [DATE]:

 
| Amount:         |   | £[AMOUNT] |
|-----------------|--------|----------------|
| Drawdown  Date: |   | [DATE]         |

 

The Advance is to be made available bycredit to [ACCOUNT DETAILS].

 

We confirm that, on today’s date and theproposed Drawdown Date:

 

1.                                      The Warranties are true and correct, and will be true and correctimmediately after the proposed Drawing.

 

2.                                      No Event of Default or Potential Event of Default has occurred. Thedrawing will not result in an Event of Default or Potential Event of Default.

 
|                       |   |
|----------------------------|--------|
|  For and on behalf of |   |
| [NAME  OF BORROWER]        |   |

 

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**Schedule 3**    Representationsand warranties

** **

**2.**                                      LITIGATION

** **

No litigation, arbitration or administrativeproceedings are taking place, pending or, to the Borrower’s knowledge,threatened against it, any of its directors or any of its assets, which, ifadversely determined, might reasonably be expected to have a Material AdverseEffect.

 

**3.**                                      EVENT OF DEFAULT

** **

No Event of Default has occurred, is continuing orwill occur when an Advance is made.

 

**4.**                                      MATERIAL ADVERSE CHANGE

** **

There has been no material adverse change in thebusiness or financial condition of the Borrower since the date of thisagreement.

 

5.                                       **PARI PASSU**

 

The Borrower’s payment obligations under thisagreement rank at least pari passu with all existing and future unsecured andunsubordinated obligations (including contingent obligations) except for thosemandatorily preferred by law applying to companies generally.

 

**6.**                                      THE DEBENTURE

** **

The Debenture, subject to any matter of lawspecifically disclosed in an opinion delivered under paragraph 1(a) ofSchedule 1, creates (or, once entered into, will create):

 

(a)                        valid, legally binding and enforceable Security for the obligationsexpressed to be secured by it; and

 

(b)                       subject to registration pursuant to section 395 of the Companies Act1985 and, in the case of real property, registration at the Land Registry,perfected Security over the assets referred to in the Debenture,

 

in favour of the Lender, having the priority andranking expressed to be created by the Debenture and ranking ahead of all (ifany) Security and rights of third parties, except those preferred by law.

 

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**Schedule 4**    Covenants onthe part of the Borrower

** **

# **1.**                                      INFORMATION COVENANTS

# ** **

## 1.1                                 The Borrowershall supply to the Lender, in addition to accounts and management information,any other information relating to the Borrower it may require. In particular itshall:

##  

(a)                        keep the Lender fully and promptly informed asto all material developments regarding the Borrower’s financial and businessaffairs,

 

(b)                       promptly notify the Lender of any significantlitigation or arbitration affecting or likely to affect the Borrower, and ofany bona fide offer to purchase or subscribe for any share capital of theBorrower, and

 

(c)                        immediately notify the Lender in writing if theBorrower and the Directors become aware of any material litigation, arbitrationor administrative proceedings current, pending or threatened by or against theBorrower or the Directors which might have a material adverse affect on theBorrower or the reputation of the Directors.

 

## 1.2                                 If the Borrower fails tokeep accounts or supply information as required by this agreement, the Lendermay appoint any accountants, auditors and other professionals it think**s** fit in order to prepare the requiredinformation, accounts or documents, and the Borrower must pay the cost of doingso on demand.

##  

## 1.3                                 TheDirectors and the Borrower shall provide annual audited reports and accountsfor the Borrower to the Lender within 3 months after each financial year end.

##  

## 1.4                                 Notlater than one month before the start of each of the Borrower’s financialyears, the Borrower must at its own cost prepare and send to the board and tothe Lender an annual budget and business plan for the Borrower for thatfinancial year, in a form acceptable to Lender.

##  

## 1.5                                 In addition to accounts and management information, the Borrower mustsupply to the Lender any other information relating to the Borrower it mayrequire. In particular it must:

##  

(a)                        keep the Lender fully and promptly informed asto all material developments regarding the Borrower’s financial and businessaffairs,

 

(b)                       promptly notify the Lender of any significantlitigation or arbitration affecting or likely to affect the Borrower, and ofany bona fide offer to purchase or subscribe for any share capital of theBorrower, and

 

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(c)                        immediately notify the Lender in writing if theBorrower and the Directors become aware of any material litigation, arbitrationor administrative proceedings current, pending or threatened by or against theBorrower or the Directors which might have a material adverse affect on theBorrower or the reputation of the Directors.

 

**2.**                                      NEGATIVE PLEDGE

** **

2.1                                 For the duration of the Facility the Borrower shall not without writtenconsent of the Lender:

 

(a)                        create, issue orallow to come into being any guarantee, indemnity, debenture, stock, charge,lien or other encumbrance, on all or part of its undertaking, property or otherassets, its uncalled capital or revenue, except for liens arising by operationof law or in the ordinary course of business, or

 

(b)                       borrow any money,obtain any advance or credit in any form, other than normal trade credit, orenter into any hire purchase, credit sale, conditional sale or deferred paymentagreements as purchaser, or any leasing agreements as lessee, except with theprior written consent of the Lender; or

 

(c)                        change the terms ofemployment or remuneration of any Director; or

 

(d)                       make payments to the Directors by way of loan, divided or bonus; or

 

(e)                        create, or permit to subsist, any Security over any of its assets;or

 

(f)                          sell, transfer or otherwise dispose of any of its receivables orassets on recourse terms; or

 

(g)                       enter into any arrangement under which money or the benefit of abank or other account may be applied, set-off or made subject to a combinationof accounts; or

 

enter into any other preferential arrangement having asimilar effect, in circumstances where the arrangement or transaction isentered into primarily as a method of raising Indebtedness or financing theacquisition of an asset

 

2.2                                 Paragraph 2.1shall notapply to:

 

(a)                        any Existing Security, except to the extent that the principalamount secured by that Existing Security exceeds the amount stated in thedefinition of Existing Security; or

 

(b)                       any netting or set-off arrangement entered into in the ordinarycourse of the Borrower’s banking arrangements for the purpose of netting debitand credit balances; or

 

(c)                        any payment or close out netting or set-off arrangement under anyhedging transaction entered into for the purpose of:

 

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(i)                           hedging any risk to which the Borrower is exposed in its ordinarycourse of trading; or

 

(ii)                        the Borrower’s interest rate or currency management operations whichare carried out in the ordinary course of business and for non-speculativepurposes only,

 

excluding, in each case, any Security undera credit support arrangement in relation to a hedging transaction; or

 

(d)                       any lien arising by operation of law and in the ordinary course oftrading; or

 

(e)                        any Security over or affecting any asset acquired by the Borrowerafter the date of this agreement if:

 

(i)                           the Security was not created in contemplation of the acquisition ofthat asset by the Borrower;

 

(ii)                        the principal amount secured has not been increased in contemplationof or since the acquisition of that asset by the Borrower; and

 

(iii)                     the Security is removed or discharged within one month of the dateof acquisition of the asset; or

 

(f)                          any Security entered into under any Transaction Document; or

 

(g)                       any Security arising under any retention of title, hire purchase orconditional sale arrangement or arrangements having similar effect in respectof goods supplied to the Borrower in the ordinary course of trading and on thesupplier’s standard or usual terms and not arising as a result of any defaultor omission by the Borrower; or

 

(h)                       any Security securing Indebtedness, the principal amount of which(when aggregated with the principal amount of any other Indebtedness which hasthe benefit of Security other than any permitted under paragraphs (a)- (g) above)does not exceed £10,000 (or its equivalent in another currency or currencies).

 

**3.**                                      EVENT OF DEFAULT

** **

The Borrower shall notify the Lender of any PotentialEvent of Default or Event of Default (and the steps, if any, being taken toremedy it) promptly on becoming aware of its occurrence.

 

**4.**                                      RANKING OF OBLIGATIONS

** **

The Borrower’s payment obligations under theTransaction Documents rank and will at all times rank:

 

(a)                        to the extent that they are secured, in all respects in priority toall its other Indebtedness, other than Indebtedness either preferred by operationof law in the event of its winding up or benefiting from Existing Security; and

 

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(b)                       to the extent that they are not so secured, at least equally andrateably in all respects with all its other unsecured and unsubordinatedIndebtedness, other than Indebtedness preferred by operation of law in theevent of its winding-up.

 

**5.**                                      COMPLIANCE WITH LAW

** **

The Borrower shall comply, in all respects, with allrelevant laws to which it may be subject if failure to do so would materiallyimpair its ability to perform its obligations under the Transaction Documents.

 

**6.**                                      MERGER

** **

The Borrower shall not enter into any amalgamation,demerger, merger or corporate reconstruction.

 

**7.**                                      CHANGE OF BUSINESS

** **

No substantial change shall be made to the generalnature of the business of the Borrower as carried on at the date of thisagreement.

 

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**Schedule 5**    Events ofdefault

** **

**1.**                                      NON-PAYMENT

** **

The Borrower fails to pay any sum payable under thisagreement when due, unless its failure to pay is caused solely by anadministrative error or technical problem and payment is made within threeBusiness Days of its due date.

 

**2.**                                      NON-COMPLIANCE

** **

The Borrower fails (other than a failure to pay) tocomply with any provision of the Transaction Documents and (if the Lenderconsiders, acting reasonably, that the default is capable of remedy) suchdefault is not remedied within 14 days of the earlier of:

 

(a)                        the Lender notifying the Borrower of the default and the remedyrequired; and

 

(b)                       the Borrower becoming aware of the default

 

**3.**                                      CROSS-DEFAULT

** **

3.1                                 Subject to paragraph 4.2:

 

(a)                        any Indebtedness of the Borrower is not paid when due or within anyoriginally applicable grace period; or

 

(b)                       any Indebtedness of the Borrower becomes due, or capable of beingdeclared due and payable prior to its stated maturity by reason of an event ofdefault however described; or

 

(c)                        any commitment for any Indebtedness of the Borrower is cancelled orsuspended by a creditor of the Borrower as a result of an event of defaulthowever described.

 

3.2                                 An event or circumstancereferred to in paragraph 4.1 shall not constitute an Event of Default if theaggregate amount of the Indebtedness affected is less than £25,000.

 

**4.**                                      INSOLVENCY

** **

4.1                                 The Borrower stops orsuspends payment of any of its debts, or is unable to, or admits its inabilityto pay its debts as they fall due.

 

4.2                                 The Borrower commencesnegotiations, or enters into any composition or arrangement, with one or moreof its creditors with a view to rescheduling any of its Indebtedness (becauseof actual or anticipated financial difficulties).

 

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4.3                                 A moratorium is declaredover any of the Borrower’s Indebtedness.

 

4.4                                 Any action, proceedings,procedure or step is taken for:

 

(a)                        the suspension of payments, winding up, dissolution, administrationor reorganisation (using a voluntary arrangement, scheme of arrangement orotherwise) of the Borrower; or

 

(b)                       the appointment of a liquidator, receiver, administrative receiver,administrator, compulsory manager or other similar officer in respect of theBorrower or any of its assets.

 

4.5                                 The value of the Borrower’sassets is less than its liabilities (taking into account contingent andprospective liabilities).

 

4.6                                 Any event occurs inrelation to the Borrower similar to those set out in this paragraph 4.

 

4.7                                 An event or circumstancereferred to in paragraphs 5.1 -5.6 inclusive shall not apply to any winding-up petition which is frivolousor vexatious and is discharged, stayed or dismissed within 14 days ofcommencement or, if earlier, the date on which it is advertised.

 

**5.**                                      DISTRESS

** **

A distress, attachment, execution, expropriation,sequestration or other legal process is levied, enforced or sued out on, oragainst, the Borrower’s assets having an aggregate value of £25,000 and is notdischarged or stayed within 21 days.

 

**6.**                                      ENFORCEMENT OF SECURITY

** **

6.1                                 Any Security in respectof Indebtedness exceeding £25,000 on or over the assets of the Borrower becomesenforceable and is not discharged within 30 days of enforcement commencing

 

**7.**                                      ILLEGALITY

** **

All or any part of this agreement becomes invalid,unlawful, unenforceable, terminated, disputed or ceases to have full force and effect.

 

**8.**                                      REPUDIATION

** **

The Borrower repudiates (or shows an intention torepudiate) this agreement.

 

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**9.****             MATERIAL ADVERSE CHANGE**

 

Where any event occurs (or circumstances exist) which,in the reasonable opinion of the Lender, is likely to materially and adverselyaffect the Borrower’s ability to perform all or any of its obligations under,or otherwise comply with the terms of, this agreement.

 

 
| Signed  by Tim Paterson-Brown     |                    |
|-----------------------------------|-------------------------|
| for  and on behalf of MGT Capital |                    |
| Investments  Limited              | /s/  Tim Paterson-Brown |
|                              | Director                |
|                              |                    |
|                              |                    |
| Signed  by Dennis Reed            |                    |
| for  and on behalf of MONEYGATE   |                    |
| GROUP  LIMITED                    | /s/  Dennis Reed        |
|                              | Director                |

 

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