Document:

Unassociated Document

    BRIDGE
      LOAN AGREEMENT

    

    THIS
      BRIDGE LOAN AGREEMENT (this “Agreement”) is made this ___ day of September,
      2008, by and among Diamond Sports & Entertainment, Inc., a Delaware
      corporation (“Borrower”), and Federal Sports & Entertainment, Inc. (f/k/a
      Rite Time Mining, Inc.), a Nevada corporation (“Lender”).

    

    W
      I T N E
      S S E T H:

    

    WHEREAS,
      Lender
      and Borrower have agreed upon certain of the terms and conditions of a merger
      (the “Merger”) and related transactions (collectively, the “Transactions”), as
      contemplated by the term sheet between the Borrower and Gottbetter Capital
      Markets, LLC (“GCap”), dated as of December 12, 2007, as amended to date (the
“Term Sheet”); 

    

    WHEREAS,
      simultaneously herewith Lender is engaged in an offering (the “Note Offering”)
      of its 0% Convertible Secured Promissory Notes (the “Convertible Notes”), which
      offering is being conducted pursuant to the exemption from registration provided
      by Rule 506 of Regulation D, Regulation S and/or Section 4(2) under the
      Securities Act of 1933, as amended (the “Securities Act”); and

    

    WHEREAS,
      to
      provide Borrower with sufficient working capital to enable Borrower to fulfill
      its obligations under certain contractual agreements incident to its business
      while Lender and Borrower prepare the documentation necessary and appropriate
      to
      consummate the Transactions and obtain all necessary approvals from stockholders
      and third parties, Lender has agreed to utilize the net proceeds of the Note
      Offering to provide Borrower with a temporary loan in the principal amount
      between $500,000 and $1,000,000 in exchange for one or more 0% unsecured bridge
      loan promissory notes (the “Note” or “Notes”), to meet working capital
      requirements agreed upon by Borrower and Lender;

    

    NOW,
      THEREFORE,
      in
      consideration of the premises and other good and valuable consideration, the
      receipt and sufficiency of which are hereby acknowledged, Borrower and Lender,
      intending to be legally bound, agree as follows:

    

    ARTICLE
      I
      - LOAN

    

    1.1.
      Loan.
      Lender
      agrees, on the terms and conditions of this Agreement, to make loans to Borrower
      in the amount of not less than $500,000 and not more than $1,000,000, as
      determined by Lender (the “Loan”). Upon the execution and delivery of this
      Agreement, Lender shall disburse approximately _________ Hundred _______
      Thousand Dollars ($_________) of the Loan to Borrower. The aggregate Loan shall
      be equivalent to the gross proceeds of the Note Offering, without regard to
      the
      payment of any fees or expenses from such gross proceeds.

    

    1.2.
      The
      Notes.
      Borrower has authorized the issuance of the Notes made in favor of Lender by
      Borrower, which shall be in the form set forth in Exhibit
      A
      attached
      hereto. Each disbursement of the Loan shall not bear interest, and shall be
      due
      and payable to the order of Lender on the earliest of (i) fifteen (15) months
      after the date of such disbursement (the “Due Date”), unless such Due Date is
      extended by Lender and Borrower in writing, (ii) the closing of any subsequent
      financing in favor of the Borrower that results in gross proceeds to the
      Borrower of an amount equal to or greater than the aggregate amount loaned
      to
      the Borrower under this Agreement and (iii) the date of closing of the Merger;
      provided,
      however,
      that
      from and after an Event of Default, as defined in Article IV hereof, interest
      on
      the Loan shall be charged at a rate of fifteen percent (15%) per annum; and
      provided further,
      however,
      that
      upon the consummation of the Merger, all indebtedness evidenced by the Notes
      shall be deemed canceled and paid in full.

    

    
      
        
        

      

      
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    1.3.
      Payments.
      Borrower shall repay the unpaid principal amount of the Loan (the “Repayment
      Amount”) on the Due Date or as otherwise indicated in Section 1.2 above, as set
      forth below; provided,
      however,
      that
      upon the closing of the Merger, all amounts outstanding under the Loan shall
      be
      forgiven, and the Note shall be cancelled and the Loan shall be deemed repaid
      in
      full:

     

    Borrower
      shall wire the Repayment Amount in same-day funds in accordance with the wire
      instructions set forth immediately below, which Repayment Amount shall be held
      in escrow pursuant to the terms of an escrow agreement by and among Lender,
      GCap, and CSC Trust Company of Delaware, as escrow agent (the “Escrow Agent”),
      and disbursed in accordance therewith solely for repayment of the aggregate
      amounts due and payable to the Buyers (defined below) on the Convertible
      Notes.

    

      
        	 	 	
                Wire
                  Instructions

              
	
                Bank:
                  

              	 	
                PNC
                  Bank

              
	
                ABA#:
                  

              	 	
                031100089

              
	
                Account
                  Name: 

              	 	
                PNC
                  Bank, on behalf of CSC Trust Company of Delaware as
                  Escrow Agent for Federal Sports & Entertainment, Inc.;
                  79-1152

              
	
                Account#:
                  

              	 	
                5605012373

              
	
                FBO:
                  

              	 	
                Diamond
                  Sports & Entertainment, Inc.

              
	 	 	
                Federal
                  ID No.

              
	 	 	
                Address

              

      

    

     

    1.4.
      Conditions
      to Loan.
      Notwithstanding the foregoing, the obligation of Lender to disburse the Loan
      to
      Borrower is subject to the satisfaction of the following
      conditions:

    

    (a) Borrower
      shall have obtained (and shall have provided copies thereof to Lender) all
      waivers, consents or approvals, if any, from third parties, and shall have
      given
      all notices to third parties, and the failure of which to obtain or to give
      notice would result in a conflict with, result in a breach of, constitute (with
      or without due notice or lapse of time or both) a default under, result in
      the
      acceleration of obligations under, create in any party the right to terminate,
      modify or cancel, or require any notice, consent or waiver under, any contract
      or instrument to which Borrower or any of its subsidiaries is a party or by
      which Borrower or any of its subsidiaries is bound or to which any of their
      assets is subject, except for any conflict, breach, default, acceleration,
      termination, modification or cancellation in any contract or instrument which
      would not have a Company Material Adverse Effect (as hereinafter defined) and
      would not adversely affect the consummation of the Loan or the other
      transactions contemplated hereby, including but not limited to the Merger.
      

    

    
      
        
        

      

      
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    (b) Those
      stockholders of Borrower listed on Schedule 1 to the Pledge Agreement (defined
      below) beneficially owning in the aggregate one million shares of the capital
      stock of the Borrower on a fully converted basis (such shares constituting
      the
“Borrower Control Shares”) shall have entered into a pledge agreement of even
      date herewith (the “Pledge Agreement”) with the Lender and Gottbetter &
Partners, LLP as collateral agent (the “Collateral Agent”) pursuant to which
      such stockholders shall have pledged to, and deposited with, the Collateral
      Agent the Borrower Control Shares, for the benefit of the investors in the
      Note
      Offering (the “Buyers”).

     

    (c) Borrower
      shall have entered into a security agreement of even date herewith with the
      Buyers pursuant to which Borrower shall have granted and conveyed to the Buyers
      a security interest in all of the tangible and intangible assets of Borrower
      now
      owned by Borrower, as security for the full and timely repayment of the
      Convertible Notes in accordance with the terms of the Convertible Notes.

     

    ARTICLE
      II - REPRESENTATIONS AND WARRANTIES OF BORROWER

    

    Borrower
      represents and warrants to Lender as follows:

    

    2.1.
      Organization.
      Each of
      Borrower and its Subsidiary, as defined below, is a corporation and limited
      liability company, respectively, duly existing under the laws of its
      jurisdiction of organization and qualified and licensed to do business in any
      jurisdiction in which the conduct of its business or its ownership of property
      requires that it be so qualified, except where the failure to be so qualified
      would not have a material adverse effect on the business, operations, condition
      (financial or otherwise), property or prospects of Borrower or any Subsidiary
      (as defined below), or the ability of Borrower and any Subsidiary to carry
      out
      its respective obligations under the Loan Documents (as defined in Section
      2.3
      below) (a “Company Material Adverse Effect”).

    

    2.2.
      Subsidiaries.
      Borrower’s only Subsidiary is Diamond Concessions, LLC, a California limited
      liability company. For purposes of this Agreement, a “Subsidiary” means any
      corporation, partnership, joint venture or other entity in which Borrower (i)
      has, directly or indirectly, an equity interest representing 50% or more of
      the
      capital stock thereof or other equity interests therein or (ii) by contract
      or
      otherwise controls
      the management of such entity and operates such entity as a combined
      business.

    

    2.3.
      Authorization.
      All
      corporate action on the part of Borrower (and its Subsidiary, as applicable)
      and
      its officers, directors and stockholders necessary for the authorization,
      execution, delivery and performance of all obligations of Borrower under this
      Agreement, the Note and all other documents executed in connection with the
      Loan
      (collectively, the “Loan Documents”) to which any of them may be a party have
      been taken. This Agreement, the Note and the other Loan Documents, when executed
      and delivered by Borrower, shall constitute legal, valid and binding obligations
      of Borrower, enforceable against Borrower in accordance with their terms, except
      as such enforceability may be limited by applicable bankruptcy, insolvency,
      moratorium or similar laws affecting creditors’ rights and the enforcement of
      debtors’ obligations generally and by general principles of equity, regardless
      of whether enforcement is pursuant to a proceeding in equity or at
      law.

    

    
      
        
        

      

      
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    2.4.
      Absence
      of Conflicts.
      The
      execution, delivery and performance of this Agreement and each of the other
      Loan
      Documents is not in conflict with nor does it constitute a breach of any
      provision contained in Borrower’s organizational documents, nor will it
      constitute an event of default under any material agreement to which Borrower
      is
      a party or by which Borrower is bound.

    

    2.5.
      Consents
      and Approvals.
      Borrower has obtained all consents, approvals and authorizations of, made all
      declarations or filings with, and given all notices to, all governmental
      authorities and agencies that are necessary for the continued operation of
      Borrower’s business as currently conducted, or are required by law, including
      Far East National Bank.

    

    2.6.
      Capitalization.
      The
      authorized and outstanding capital stock of Borrower is described on Schedule
      2.6 attached hereto. Except as set forth on Schedule 2.6 or as contemplated
      by
      the Transactions, there are no subscriptions, convertible securities, options,
      warrants or other rights (contingent or otherwise) currently outstanding to
      purchase any of the authorized but unissued capital stock of Borrower. Except
      as
      set forth in Schedule 2.6 or as contemplated by the Transactions, Borrower
      has
      no obligation to issue shares of its capital stock, or subscriptions,
      convertible securities, options, warrants, or other rights (contingent or
      otherwise) to purchase any shares of its capital stock or to distribute to
      holders of any of its equity securities, any evidence of indebtedness or asset.
      No shares of Borrower capital stock are subject to a right of withdrawal or
      a
      right of rescission under any applicable securities law. Except as set forth
      in
      Schedule 2.6, there are no outstanding or authorized stock appreciation, phantom
      stock or similar rights with respect to Borrower. To the Knowledge (as defined
      below) of Borrower, except as described in Schedule 2.6 or otherwise
      contemplated by this Agreement, there are no agreements to which Borrower is
      a
      party or by which it is bound with respect to the voting (including without
      limitation voting trusts or proxies), registration under any applicable
      securities laws, or sale or transfer (including without limitation agreements
      relating to pre-emptive rights, rights of first refusal, co-sale rights or
      “drag-along” rights) of any securities of Borrower. Except as provided in
      Schedule 2.6, to the Knowledge of Borrower, there are no agreements among other
      parties, to which Borrower is not a party and by which it is not bound, with
      respect to the voting (including without limitation voting trusts or proxies)
      or
      sale or transfer (including without limitation agreements relating to rights
      of
      first refusal, co-sale rights or “drag-along” rights) of any securities of
      Borrower.

    

    2.7.
      Litigation.
      Except
      as disclosed on Schedule 2.7, there are no actions, suits, claims,
      investigations, arbitrations or other legal or administrative proceedings,
      to
      the Knowledge of Borrower, threatened against Borrower at law or in equity,
      and
      to Borrower’s Knowledge, there is no basis for any of the foregoing. Except as
      disclosed on Schedule 2.7, there are no unsatisfied judgments, penalties or
      awards against or affecting Borrower or its businesses, properties or assets.
      Except as disclosed on Schedule 2.7, Borrower is not in default, and no event
      has occurred which with the passage of time or giving of notice or both would
      constitute a default by Borrower with respect to any order, writ, injunction
      or
      decree known to or served upon Borrower of any court or of any foreign, federal,
      state, municipal or other governmental department, commission, board, bureau,
      agency or instrumentality, domestic or foreign. Except as disclosed on Schedule
      2.7, there is no action or suit by Borrower pending or threatened against
      others. Except as disclosed on Schedule 2.7, Borrower has complied with all
      laws, rules, regulations and orders applicable to its current business,
      operations, properties, assets, products and services the violation of which
      would have a Company Material Adverse Effect. There is no existing law, rule,
      regulation or order, and Borrower has no Knowledge of any proposed law, rule,
      regulation or order, whether foreign, federal or state, that would prohibit
      or
      materially restrict Borrower from, or otherwise materially adversely affect
      Borrower in, conducting its businesses in any jurisdiction in which it is now
      conducting business. 

    

    
      
        
        

      

      
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    As
      defined in this Agreement, “Knowledge” of Borrower means the actual knowledge by
      a director or officer of Borrower of a particular fact or circumstance or such
      knowledge as may reasonably be imputed to such person as a result of such
      person’s actual knowledge of other facts or circumstances as well as any other
      knowledge which such person would have possessed had such person made reasonable
      inquiry of appropriate employees and agents of Borrower with respect to the
      matter in question.

    

    2.8.
      Absence
      of Certain Events.
      To
      Borrower’s Knowledge, there is no existing condition, event or series of events
      which reasonably would be expected to have a Company Material Adverse
      Effect.

    

    2.9.
      Title
      to Property and Assets.
      Borrower does not own any real property. Except as set forth on Schedule 2.9,
      Borrower has good and marketable title to all of its personal property and
      assets free and clear of any material restriction, mortgage, deed of trust,
      pledge, lien, security interest or other charge, claim or encumbrance which
      would have a Company Material Adverse Effect. Except as set forth on Schedule
      2.9, with respect to properties and assets it leases, Borrower is in material
      compliance with such leases and holds a valid leasehold interest free of any
      liens, claims or encumbrances which would have a Company Material Adverse
      Effect.

    

    2.10.
      Governmental
      Permits.
      Borrower (including its Subsidiary) holds all licenses, franchises, permits
      and
      other governmental authorizations which are required for the conduct of any
      aspect of Borrower’s business, as presently conducted and as presently
      contemplated to be conducted, including, but not limited to, all such business
      operations contemplated by, or incident to, the Transactions. All such licenses,
      franchises, permits and other governmental authorizations are valid and current,
      and Borrower has not received any notice that any governmental authority intends
      to cancel, terminate or not renew any such license, franchise, permit or other
      governmental authorization. Borrower has conducted and is conducting its
      business in material compliance with the requirements, standards, criteria
      and
      conditions set forth in such licenses, franchises, permits and other
      governmental authorizations, and all laws and regulations applicable thereto,
      and is not in violation of any of the foregoing. The consummation of the
      transactions contemplated hereunder will not alter or impair or require changes
      to any such license, franchise, permit or other governmental
      authorization.

    

    
      
        
        

      

      
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    ARTICLE
      III.A - COVENANTS OF BORROWER

    

    So
      long
      as the Note is outstanding, Borrower agrees that, unless Lender shall give
      its
      prior consent in writing:

    

    3.1.
      Ordinary
      Course.
      Borrower shall carry on its business in the ordinary course substantially as
      conducted heretofore, and shall not engage in any transaction outside of the
      ordinary course of business.

    

    3.2.
      Maintain
      Properties.
      Borrower shall maintain its properties and facilities in good working order
      and
      condition, reasonable wear and tear excepted.

    

    3.3.
      Performance
      under Agreements.
      Borrower shall perform all of its material obligations under agreements relating
      to or affecting its assets, properties or rights.

    

    3.4.
      Cooperation
      with Lender.
      Borrower shall cooperate with Lender and shall use its reasonable best efforts
      to complete and sign the merger agreement contemplated by the Merger and shall
      use its reasonable best efforts to consummate the Transactions contemplated
      thereby.

    

    3.5.
      Financial
      Statements.
      Borrower shall provide to Lender prior to the Due Date any such audited or
      unaudited financial statements as may be required under applicable U.S.
      Securities Exchange Commission (“SEC”) regulations for inclusion of such
      statements in Lender’s SEC and other regulatory filings upon and following the
      closing of the Merger.

    

    3.6.
      Maintenance
      of Business Organization.
      Borrower shall maintain and preserve its business organization intact and use
      its reasonable best efforts to retain its present key employees and
      relationships with suppliers, customers and others having business relationships
      with Borrower. 

    

    3.7.
      Compliance
      with Permits.
      Borrower shall maintain material compliance with all permits, laws, rules and
      regulations, consent orders and all other orders of applicable courts,
      regulatory agencies, and similar governmental authorities. 

    

    3.8.
      Leases.
      Borrower shall maintain its present leases in accordance with their respective
      terms, and may enter into new or amended lease instruments. 

    

    3.9.
      Payments.
      Except
      with respect to fees due to attorneys, accountants, and investment bankers
      relating to the Transactions, including with respect to the Loan, Borrower
      shall
      not make any payment, or incur any obligation to make any payment in the
      ordinary course of business in excess of $75,000 without the prior written
      consent of Lender. Borrower shall use the proceeds from the Loan to meet the
      working capital requirements set forth on Exhibit
      B
      attached
      hereto.

    

    3.10.
      Loan
      Documents.
      Borrower shall comply in all respects with the terms of the Loan Documents.
      

    

    
      
        
        

      

      
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    3.11.
      Mergers.
      Except
      as contemplated by the Transactions, Borrower shall not merge or consolidate
      with or into any other corporation, or sell, assign, lease or otherwise dispose
      of or voluntarily part with the control (whether in one transaction or in a
      series of related transactions) of assets (whether now owned or hereafter
      acquired) having a fair market value of more than $25,000 at the time(s) of
      transfer, or sell, assign or otherwise dispose of (whether in one transaction
      or
      in a series of transactions) any of its accounts receivable (whether now in
      existence or hereafter created) at a discount or with recourse, to any person,
      except sales or other dispositions of assets in the ordinary course of business,
      including, but not limited to, Borrower’s sale of existing teams or territorial,
      market and team operating rights. 

    

    3.12.
      Charter
      Documents.
      Borrower shall not make any amendment to its Certificate of Incorporation but
      may amend, revise and/or restate its By-Laws. 

    

    3.13.
      Senior
      or Pari Passu Indebtedness.
      Borrower shall not incur, create, assume, guaranty or permit to exist any
      indebtedness in an amount equal to or greater than $100,000 that ranks senior
      in
      priority to, or pari passu with, the obligations under the Notes and the other
      Loan Documents, except for (i) indebtedness existing on the date hereof and
      set
      forth in Schedule 3.13 attached hereto, and (ii) indebtedness created as a
      result of a subsequent financing if the gross proceeds to the Borrower of such
      financing are equal to or greater than the aggregate principal amount of the
      Notes and the Notes are repaid in full upon the closing of such financing.
      The
      aggregate outstanding trade debt of Borrower and its subsidiaries as of
      September 1, 2008 was $1,268,000.

    

    3.14.
      Liens.
      Borrower shall not create, incur, assume or permit to exist any lien on any
      property or assets (including stock or other securities of Borrower or any
      of
      its Subsidiaries) now owned or hereafter acquired by it or on any income or
      revenues or rights in respect of any thereof, except: 

    

    (a) liens
      on
      property or assets of Borrower and its Subsidiaries existing on the date hereof
      and set forth in Schedule 3.14 attached hereto, provided that such liens shall
      secure only those obligations which they secure on the date hereof;

    

    (b) any
      lien
      created under the Loan Documents;

    

    (c) any
      lien
      existing on any property or asset prior to the acquisition thereof by Borrower
      or any of its Subsidiaries, provided that 

    

    1. such
      lien
      is not created in contemplation of or in connection with such acquisition and
      

    

    2. such
      lien
      does not apply to any other property or assets of Borrower or any of its
      Subsidiaries;

    

    (d) liens
      for
      taxes, assessments and governmental charges;

    

    
      
        
        

      

      
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    (e) carriers’,
      warehousemen’s, mechanics’, materialmen’s, repairmen’s, landlord’s or other like
      liens arising in the ordinary course of business and securing obligations that
      are not due and payable;

    

    (f) pledges
      and deposits made in the ordinary course of business in compliance with
      workmen’s compensation, unemployment insurance and other social security laws or
      regulations;

    

    (g) deposits
      to secure the performance of bids, trade contracts (other than for
      indebtedness), leases, statutory obligations, surety and appeal bonds,
      performance bonds and other obligations of a like nature incurred in the
      ordinary course of business;

    

    (h) zoning
      restrictions, easements, licenses, covenants, conditions, rights-of-way,
      restrictions on use of real property and other similar encumbrances incurred
      in
      the ordinary course of business and minor irregularities of title that, in
      the
      aggregate, are not substantial in amount and do not materially detract from
      the
      value of the property subject thereto or interfere with the ordinary conduct
      of
      the business of Borrower or any of its Subsidiaries;

    

    (i) purchase
      money security interests in real property, improvements thereto or equipment
      hereafter acquired (or, in the case of improvements, constructed) by Borrower
      or
      any of its subsidiaries, provided that 

    

    1. such
      security interests secure indebtedness permitted by this Agreement,

    

    2. such
      security interests are incurred, and the indebtedness secured thereby is
      created, within 90 days after such acquisition (or construction),

    

    3. the
      indebtedness secured thereby does not exceed 85% of the lesser of the cost
      or
      the fair market value of such real property, improvements or equipment at the
      time of such acquisition (or construction) and 

    

    4. such
      security interests do not apply to any other property or assets of Borrower
      or
      any of its Subsidiaries;

    

    (j) liens
      arising out of judgments or awards (other than any judgment that constitutes
      an
      Event of Default hereunder) in respect of which Borrower or any of its
      Subsidiaries shall in good faith be prosecuting an appeal or proceedings for
      review and in respect of which it shall have secured a subsisting stay of
      execution pending such appeal or proceedings for review, provided Borrower
      shall
      have set aside on its books adequate reserves with respect to such judgment
      or
      award; and

    

    (k) deposits,
      liens or pledges to secure payments of workmen’s compensation and other
      payments, public liability, unemployment and other insurance, old-age pensions
      or other social security obligations, or the performance of bids, tenders,
      leases, contracts (other than contracts for the payment of money), public or
      statutory obligations, surety, stay or appeal bonds, or other similar
      obligations arising in the ordinary course of business.

    

    
      
        
        

      

      
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    3.15.
      Dividends
      and Distributions.
      Borrower or any of its Subsidiaries shall not declare or pay, directly or
      indirectly, any dividend or make any other distribution (by reduction of capital
      or otherwise), whether in cash, property, securities or a combination thereof,
      with respect to any shares of its capital stock or directly or indirectly
      redeem, purchase, retire or otherwise acquire for value (or permit any
      Subsidiary to purchase or acquire) any shares of any class of its capital stock
      or set aside any amount for any such purpose.

    

    3.16.
      Subsidiary
      Dividends.
      Borrower shall not permit its Subsidiary to, directly or indirectly, create
      or
      otherwise cause or suffer to exist or become effective any encumbrance or
      restriction on the ability of such Subsidiary to:

    

    (a) pay
      any
      dividends or make any other distributions on its capital stock or any other
      interest or

    

    (b) make
      or
      repay any loans or advances to Borrower.

    

    3.17.
      Limitation
      on Certain Payments and Prepayments.
      Borrower shall not:

    

    (a) pay
      in
      cash any amount in respect of any indebtedness or preferred stock that may
      at
      the obligor’s option be paid in kind or in other securities; or

    

    (b) optionally
      prepay, repurchase or redeem or otherwise defease or segregate funds with
      respect to any indebtedness of Borrower or its Subsidiary, other than for senior
      indebtedness existing on the date hereof and set forth in Schedule 3.17 attached
      hereto, or indebtedness under the Loan Documents.

    

    Within
      three (3) business days following Borrower’s request for a waiver of any
      provision of this Article III, Lender shall provide Borrower with their response
      to such request.

    

    3.18. Future
      issuances. Borrower covenants and agrees that it will not during the term of
      this Agreement issue any of its equity securities (a “Future Issuance”), except
      up to 300,000 shares of its common stock which it may issue (or with respect
      to
      which it may grant as stock options) as compensation to employees, consultants,
      advisors or service providers of the Company or its Subsidiary, and except
      if
      (i) the Borrower issues equity securities in a capital raising offering 
with proceeds sufficient to repay the Notes and the Notes are repaid in full
      simultaneously with the closing of such offering, or (ii) the Borrower causes
      sufficient additional shares of its common stock, or securities convertible
      into
      its common stock without additional consideration, to be delivered under the
      Pledge Agreement (as defined below) to the Collateral Agent for the Buyers
      such
      that the aggregate number of Pledged Shares (on an
      as-converted-into-common-stock basis) as a percentage of the total number of
      shares of capital stock (on an as-converted-into-common-stock basis) of the
      Borrower outstanding (the “Pledged Percentage”) as of the date of such Future
      Issuance equals the Pledged Percentage as of the date hereof, which is
      approximately 16.9%. Capitalized terms used in this Section 3.17 and not
      otherwise defined in this Agreement shall have those meanings given to them
      in
      that certain Pledge Agreement by and among the parties thereto of even date
      herewith (the “Pledge Agreement”).

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    ARTICLE
      III.B - COVENANTS OF LENDER

    

    Lender
      covenants and agrees that it shall use the proceeds from Borrower of the
      Repayment Amount solely to repay in full the outstanding principal amount of
      the
      Convertible Notes, with interest, if any, to the Buyers. Lender further agrees
      to issue its instruction letter (the “Instruction Letter”) to the Escrow Agent
      authorizing the Escrow Agent to release from escrow in favor of Buyers the
      Repayment Amount in repayment of the Convertible Notes, which Instruction Letter
      shall be signed by Lender and held in trust by Gottbetter & partners, LLP on
      behalf of Borrower until repayment on the Due Date or as otherwise set forth
      herein.

    

    ARTICLE
      IV - DEFAULTS AND REMEDIES

    

    4.1.
      An
“Event of Default” occurs if: 

    

    (a) Borrower
      defaults in the payment of any principal of the Note when the same shall become
      due, either by the terms thereof or otherwise as herein provided;
      or

    

    (b) Borrower
      defaults, in whole or in part, in the performance or observance of any other
      material agreement, term or condition contained in the Note or the other Loan
      Documents, and such breach shall not have been cured within ten (10) days after
      receipt of written notice thereof; or 

    

    (c) Borrower
      defaults with respect to any other indebtedness for borrowed money of Borrower
      or under any agreement under which such indebtedness may be issued by Borrower
      and such default shall continue for more than the period of grace, if any,
      therein specified, if the aggregate amount of such indebtedness for which such
      default shall have occurred exceeds $25,000;

    

    (d) Borrower
      defaults with respect to any contractual obligation of Borrower under or
      pursuant to any contract, lease, or other agreement to which Borrower is a
      party
      and such default shall continue for more than the period of grace, if any,
      therein specified, if the aggregate amount of Borrower’s contractual liability
      arising out of such default exceeds or is reasonably estimated to exceed
      $25,000; 

    

    (e) the
      Merger shall not have closed and the Note shall not have been repaid in full
      by
      the Due Date; or

    

    (f) Borrower
      pursuant to or within the meaning of any Bankruptcy Law (as defined
      below):

    

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    (i)
      commences a voluntary case,

    

    (ii)
      consents to the entry of an order for relief against it in an involuntary
      case,

    

    (iii)
      consents to the appointment of a Custodian (as defined below) of it or for
      all
      or substantially all of its property,

    

    (iv)
      makes a general assignment for the benefit of its creditors, or

    

    (v)
      is
      the debtor in an involuntary case which is not dismissed within thirty (30)
      days
      of the commencement thereof, or

    

    (g) a
      court
      of competent jurisdiction enters an order or decree under any Bankruptcy Law
      that:

    

    (i)
      provides for relief against Borrower in an involuntary case,

    

    (ii)
      appoints a Custodian of Borrower for all or substantially all of its property,
      or

    

    (iii)
      orders the liquidation of Borrower,

    

    (h) a
      final
      judgment for the payment of money in an amount in excess of $25,000 shall be
      rendered against Borrower (other than any judgment as to which a reputable
      insurance company shall have accepted full liability in writing) and shall
      remain undischarged for a period (during which execution shall not be
      effectively stayed) of 20 days after the date on which the right to appeal
      has
      expired; or

    

    (i) an
      event
      shall occur or there exist facts or circumstances which create or result in
      a
      Company Material Adverse Effect;

    

    then
      and
      in any such case (x) upon the occurrence of any Event of Default described
      in
      paragraphs (e) or (f), the unpaid principal amount of the Notes shall
      automatically become due and payable, without presentment, demand, protest
      or
      notice of any kind, all of which are hereby waived by Borrower, and (y) upon
      the
      occurrence of any other Event of Default, in addition to any other rights,
      powers and remedies permitted by law or in equity, Lender may, at its option,
      by
      notice in writing to Borrower, declare the Notes to be, and the Notes shall
      thereupon be and become, immediately due and payable, together with all other
      sums due hereunder, without presentment, demand, protest or other notice of
      any
      kind, all of which are waived by Borrower.

    

    Upon
      the
      occurrence of any Event of Default, the holder of the Notes may proceed to
      protect and enforce its rights by an action at law, suit in equity or other
      appropriate proceeding, whether for the specific performance of any agreement
      contained herein or in the Notes held by it, for an injunction against a
      violation of any of the terms hereof or thereof, or for the pursuit of any
      other
      remedy which it may have by virtue of this Agreement or pursuant to applicable
      law. Borrower shall pay to the holder of the Notes upon demand the reasonable
      costs and expenses of collection and of any other actions referred to in this
      Article, including without limitation reasonable attorneys’ fees, expenses and
      disbursements.

    

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    No
      course
      of dealing and no delay on the part of the holder of the Notes in exercising
      any
      of its rights shall operate as a waiver thereof or otherwise prejudice the
      rights of such holders, nor shall any single or partial exercise of any right,
      power or remedy preclude any other or further exercise thereof or the exercise
      of any other right, power or remedy hereunder. No right, power or remedy
      conferred hereby or by the Notes on the holder thereof shall be exclusive of
      any
      other right, power or remedy referred to herein or therein or now or hereafter
      available at law, in equity, by statute or otherwise.

    

    4.2.
      For
      purposes of this Article, the following definitions shall apply:

    

    “Bankruptcy
      Law” means Title 11, U.S. Code or any similar federal or state law for the
      relief of debtors, or equivalent law of a non-U.S. jurisdiction.

    

    “Custodian”
      means any receiver, trustee, assignee, liquidator or similar official under
      any
      Bankruptcy Law.

    

    ARTICLE
      V
      - NOTICES

    

    All
      notices, requests and demands shall be given to or made upon the respective
      parties hereto in writing, at such address as may be designated by it in a
      written notice to the other party. All notices, requests, consents and demands
      hereunder shall be effective when duly deposited in the mails (by overnight
      delivery by a nationally-recognized overnight courier service or by United
      States registered or certified mail, postage prepaid, return receipt requested)
      with a copy via facsimile. Unless the parties designate otherwise, notices
      should be addressed as follows: 

    

    If
      to
      Borrower:

    

    Diamond
      Sports & Entertainment, Inc.

    7080
      Donlon Way, Ste. 109

    Dublin,
      CA 94568 

    Attn:
      David Kaval, President 

    Facsimile:
      (

    

    with
      a
      copy to:

    

    Wilson
      Sonsini Goodrich & Rosati

    650
      Page
      Mill Road

    Palo
      Alto, CA 94304

    Attention:
      Jack Sheridan

    Facsimile:
      (

    

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    If
      to
      Lender:

    

    Federal
      Sports & Entertainment, Inc.

    
      	
              47395
                Monroe Street, #274

            
	
              Indio,
                California

            

    

    Attn:
      Linda Farrell, President 

    Facsimile:
      (

    

    with
      a
      copy to:

    

    Gottbetter
      & Partners, LLP

    488
      Madison Avenue, 12th
      Floor

    New
      York,
      NY 10022

    Attn:
      Adam S. Gottbetter, Esq.

    Facsimile:
      (212) 400-6901

    

    ARTICLE
      VI - MISCELLANEOUS

    

    6.1.
      Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of New York, without regard to conflicts of laws principles thereof.
      

    

    6.2.
      Amendment.
      This
      Agreement may be amended, modified or terminated only by an instrument in
      writing signed by all parties.

    

    6.3.
      No
      Assignment.
      Neither
      this Agreement nor any right or obligation provided for herein may be assigned
      by any party without the prior written consent of the other
      parties.

    

    6.4.
      Successors.
      The
      terms and provisions of this Agreement shall be binding upon and inure to the
      benefit of, and be enforceable by, the respective successors and assigns of
      the
      parties hereto.

    

    6.5.
      Counterparts.
      This
      Agreement may be executed in any number of counterparts, with the same effect
      as
      if all parties had signed the same document. All such counterparts shall be
      deemed an original, shall be construed together and shall constitute one and
      the
      same instrument. This Agreement may be executed by facsimile
      signature.

    

    6.6.
      Construction.
      The
      language used in this Agreement shall be deemed to be the language chosen by
      the
      parties to express their mutual intent, and no rule of strict construction
      shall
      be applied against any party.

    

    6.8.
      Headings.
      The
      section headings contained in this Agreement are inserted for convenience only
      and shall not affect in any way the meaning or interpretation of this
      Agreement.

    

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    6.8.
      Severability.
      Any
      term or provision of this Agreement that is invalid or unenforceable in any
      situation in any jurisdiction shall not affect the validity or enforceability
      of
      the remaining terms and provisions hereof or the validity or enforceability
      of
      the offending term or provision in any other situation or in any other
      jurisdiction. If the final judgment of a court of competent jurisdiction
      declares that any term or provision hereof is invalid or unenforceable, the
      parties agree that the court making the determination of invalidity or
      unenforceability shall have the power to limit the term or provision, to delete
      specific words or phrases, or to replace any invalid or unenforceable term
      or
      provision with a term or provision that is valid and enforceable and that comes
      closest to expressing the intention of the invalid or unenforceable term or
      provision, and this Agreement shall be enforceable as so modified.

    

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the parties hereto have caused this Bridge Loan Agreement
      to be
      duly executed as of the day and year first above written. 

    

    
      	
              LENDER:

               

              FEDERAL
                SPORTS & ENTERTAINMENT, INC. 

               

               

              By:____________________

              Name: Linda
                Farrell

              Title: President

               

            	
              BORROWER:

               

              DIAMOND
                SPORTS & ENTERTAINMENT, INC.

               

               

              By:__________________________

              Name: David
                Kaval

              Title: Chairman
                and Chief Executive Officer

               

               

            

    

     

    [SIGNATURE
      PAGE TO BRIDGE LOAN AGREEMENT]

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

    

    Promissory
      Note

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    EXHIBIT
      B

    

    Use
      of
      Proceeds

    

    1.
      General
      corporate purposes

    

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

    SCHEDULES

    

    [Borrower
      to prepare and attach the various Schedules called for by Articles II and III
      of
      this Agreement]

     

     

    
      
         

      

      
        18Unassociated Document

    

      Exhibit
        “A” to the Bridge Loan Agreement

    

     

    THE
      ISSUANCE AND SALE OF THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES
      ACT
      OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS.  THE SECURITIES
      MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF
      (I)
      AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
      ACT
      OF 1933, AS AMENDED, OR (II) AN OPINION OF COUNSEL, IN A FORM REASONABLY
      ACCEPTABLE TO THE LENDER, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT.
      

    

    

    Unsecured
      Bridge Loan Promissory Note

    

    
      	
              $__________

            	
              September
                __ , 2008

            

    

    

    FOR
      VALUE
      RECEIVED, DIAMOND SPORTS & ENTERTAINMENT, INC., a Delaware corporation
      (hereinafter called the “Borrower”), hereby promises to pay to the order of
      FEDERAL SPORTS & ENTERTAINMENT, INC, INC., a Nevada corporation (hereinafter
      called the “Lender”), 47395 Monroe Street, #274, Indio, California _____, the
      principal sum of ____________________ Dollars ($__________) (the “Loan”), in
      lawful money of the United States of America and in immediately available funds.
      

    

    1. The
      outstanding principal balance of this Note shall be due and payable on the
      earliest to occur of (i) December __, 2009 (the “Due Date”), which Due Date may
      be extended by the Borrower and the Lender in writing, (ii) the closing of
      any
      subsequent financing in favor of the Borrower that results in gross proceeds
      to
      the Borrower of an amount equal to or greater than the aggregate amount loaned
      to the Borrower under the Bridge Loan Agreement (the “Bridge Loan Agreement”) of
      even date herewith by and between the Borrower and the Lender and (iii) the
      date
      of closing of the a merger between the Borrower and the Lender, or an affiliate
      of the Lender (the “Merger”), as contemplated by the term sheet between the
      Borrower and Gottbetter Capital Markets, LLC, dated as of December 12, 2007,
      as
      amended to date; provided,
      however,
      that
      upon the consummation of the Merger, all
      indebtedness evidenced hereby shall be deemed canceled and paid in
      full.

    

    2. This
      Note
      shall not bear interest.

    

    3. Upon
      an
“Event of Default,” as defined in the Bridge Loan Agreement, interest shall
      begin to accrue on the unpaid principal balance of this Note at a rate of
      fifteen percent (15%) per annum. Such default interest rate shall continue
      until
      all defaults are cured.

    

    4. This
      Note
      is subject to the terms of the Bridge Loan Agreement. All capitalized and
      undefined terms herein shall have the meaning given them in the Bridge Loan
      Agreement. 

    

    5. Upon
      the
      occurrence of an Event of Default (including the passage of applicable cure
      periods) under the Bridge Loan Agreement, the entire principal amount
      outstanding hereunder, together with all other sums due hereunder, shall, as
      provided in the Bridge Loan Agreement, become immediately due and
      payable.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Notwithstanding
      the foregoing, if an Event of Default is waived by the Lender, the Borrower
      shall use its reasonable best efforts to ensure that the Merger and the
      Transactions are consummated.

    

    6. In
      addition to the rights and remedies given it by this Note, the Lender shall
      have
      all those rights and remedies allowed by applicable laws. The rights and
      remedies of the Lender are cumulative and recourse to one or more right or
      remedy shall not constitute a waiver of the others. The Borrower shall be liable
      for all commercially reasonable costs, expenses and attorneys’ fees incurred by
      the Lender in connection with the collection of the indebtedness evidenced
      by
      the Note. 

    

    7. To
      the
      extent permitted by applicable law, the Borrower waives all rights and benefits
      of any statute of limitations, moratorium, reinstatement, marshalling,
      forbearance, valuation, stay, extension, redemption, appraisement and exemption
      now provided or which may hereafter by provided by law, both as to itself and
      as
      to all of its properties, real and personal, against the enforcement and
      collection of the indebtedness evidenced hereby. 

    

    8. All
      notices, requests, demands, and other communications with respect hereto shall
      be in writing and shall be delivered by hand, sent prepaid by a
      nationally-recognized overnight courier service or sent by the United States,
      certified, postage prepaid, return receipt requested, at the addresses
      designated in the Bridge Loan Agreement or such other address as the parties
      may
      designate to each other in writing. 

    

    9. This
      Note
      or any provision hereof may be waived, changed, modified or discharged only
      by
      agreement in writing signed by the Borrower and the Lender. The Borrower may
      not
      assign or transfer its obligation hereunder without the prior written consent
      of
      the Lender. 

    

    10. The
      term
“the Borrower” shall include each person and entity now or hereafter liable
      hereunder, whether as maker, successor, assignee or endorsee, each of whom
      shall
      be jointly, severally and primarily liable for all of the obligations set forth
      herein. 

    

    11. If
      any
      provision of this Note shall for any reason be held invalid or unenforceable,
      such invalidity or unenforceability shall not affect any other provision of
      this
      Note, but this Note shall be construed as if this Note had never contained
      the
      invalid or unenforceable provision. 

    

    12. This
      Note
      shall be governed by and construed in accordance with the domestic laws of
      the
      State of New York, without giving effect to any choice of law provision or
      rule.
      Any controversy or dispute arising out of or relating to this Note shall be
      settled solely and exclusively in accordance with the provisions of the Bridge
      Loan Agreement and Security Agreement, which provisions are incorporated by
      reference herein as though fully set forth. 

    

    

    [Remainder
      of Page Intentionally Left Blank]

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    IN
      WITNESS WHEREOF, the undersigned Borrower has caused the due execution of this
      Bridge Loan Promissory Note as of the day and year first herein above written.
      

    

    

    
      	 	
              DIAMOND
                SPORTS & ENTERTAINMENT, INC.

            
	 	 	 
	 	 	 
	 	 	 
	 	
              By:

            	 
	 	
              Name:

            	
              David
                Kaval

            
	 	
              Title:

            	
              Chairman
                and Chief Executive Officer

            

    

    

    

    

    

    [SIGNATURE
      PAGE TO BRIDGE LOAN PROMISSORY NOTE]

     

    
      
         

      

      
        3

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