Document:

EXHIBIT 10.38

THIS  DEBENTURE HAS NOT BEEN  REGISTERED  WITH THE UNITED STATES  SECURITIES AND
EXCHANGE COMMISSION (THE "COMMISSION") OR THE SECURITIES COMMISSION OF ANY STATE
PURSUANT TO AN EXEMPTION FROM REGISTRATION  UNDER REGULATION S PROMULGATED UNDER
THE  SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").  THIS DEBENTURE  SHALL
NOT  CONSTITUTE  AN  OFFER  TO SELL  NOR A  SOLICITATION  OF AN OFFER TO BUY THE
DEBENTURE  IN ANY  JURISDICTION  IN WHICH  SUCH OFFER OR  SOLICITATION  WOULD BE
UNLAWFUL.

THIS DEBENTURE MAY NOT BE SOLD, PLEDGED, TRANSFERRED OR ASSIGNED EXCEPT PURSUANT
TO AN EFFECTIVE  REGISTRATION  STATEMENT UNDER THE 1933 ACT AND UNDER APPLICABLE
STATE  SECURITIES  LAWS, OR IN A TRANSACTION  WHICH IS EXEMPT FROM  REGISTRATION
UNDER THE  PROVISIONS OF THE 1933 ACT AND UNDER  PROVISIONS OF APPLICABLE  STATE
SECURITIES LAWS.

                         SPORTSPRIZE ENTERTAINMENT INC.

                            9% CONVERTIBLE DEBENTURE

US$_______                                                          May 30, 2000

SPORTSPRIZE  ENTERTAINMENT  INC.,  a Nevada  corporation  (the  "Company"),  the
principal office of which is located at 13101 Washington  Blvd.,  Suite 131, Los
Angeles,  California  90066, for value received hereby promises to pay _____, or
its  registered  assigns (the  "Holder"),  the sum of US$________ or such lesser
amount  as shall  then  equal  the  outstanding  principal  amount  hereof  (the
"Principal  Amount") and any unpaid accrued interest hereon,  (together with the
Principal Amount, the "Outstanding Amount") as set forth below, on May 30, 2005,
(the "Maturity  Date").  Payment for all amounts due hereunder  shall be made by
mail to the registered address of the Holder. This 9% Convertible Debenture (the
"Debenture") is issued pursuant to that Debenture and Warrant Purchase Agreement
between  the  Company  and  certain  purchasers  dated as of May 30,  2000  (the
"Purchase Agreement").

The  following is a statement of the rights of the Holder of this  Debenture and
conditions to which this  Debenture is subject,  and to which the Holder hereof,
by the acceptance of this Debenture, agrees:

1.   Definitions.  As used in this Debenture,  the following  terms,  unless the
context otherwise requires, have the following meanings:

     (i)       "Average  Closing  Price"  shall  mean the  average  of the three
lowest  consecutive  closing bid prices of the Common Stock on the NASD Over The
Counter Bulletin Board ("OTCBB") or such other public market or exchange that is
the primary  public market for such Common Stock as quoted by Bloomberg L.P. or,
if not reported thereby,  another authoritative source, in the thirty day period
prior to the Conversion Date.

                                      -1-
<PAGE>

     (ii)      "Closing  Date"  shall  have the  meaning  given that term in the
Purchase Agreement.

     (iii)     "Company"  includes the Company and any  corporation  which shall
succeed to or assume the obligations of the Company under this Debenture.

     (iv)      "Common  Stock"  shall  mean the  shares of  common  stock of the
Company.

     (v)       "Holder" when the context  refers to a Holder of this  Debenture,
shall  mean any person  who shall at the time be the  registered  Holder of this
Debenture.

     (vi)      "Conversion  Date" shall mean,  with respect to each  Conversion,
the date on which the  Holder  delivers  to the  Company a Notice of  Conversion
pursuant to Section 4.1 or the date on which the Company  delivers to the Holder
a Redemption Notice pursuant to Section 4.4.

     (vii)     "Conversion  Price"  shall  mean the lesser of (a) $1.275 and (b)
eighty-three  percent (83%) of the Average  Closing Price.  Notwithstanding  the
foregoing,  the Conversion  Price shall not be less than the minimum  conversion
price or, if applicable, adjustment price related to any financings in excess of
US$1 million by the Company pursuant to which the Company issues securities that
(i) are convertible into Common Stock or (ii) subject to reset and/or adjustment
by  issuance  of Common  Stock  based on the market  price of Common  Stock (the
"Floor Price").  In no event shall the Floor Price be greater than $1.00. If the
Company completes a subsequent  financing of securities  convertible into Common
Stock at a price per  share  less than the Floor  Price,  the Floor  Price  with
respect to any  outstanding  balance under the Debenture  shall be readjusted to
the lower price per share of Common Stock of such financing.

     (viii)    "Notice  of  Conversion"  shall  mean the  written  notice by the
Holder to the  Company at its  principal  corporate  office of the  election  to
convert any vested portion of this  Debenture,  in whole or in part, into shares
of Common Stock, pursuant to Section 4.1.

2.   Interest.

     (i)       The  Company  shall  pay  interest  (computed  on the  basis of a
365-day year) at a rate of nine percent (9%) per annum on the Outstanding Amount
during the period beginning on the date of issuance of this Debenture and ending
on the later of the date the  Outstanding  Amount is paid in full or the date of
the final conversion the Principal Amount.

     (ii)      Interest  shall be paid in Common Stock issued at the  Conversion
Price, or at the Company's option,  paid in cash on the later of the date of the
Outstanding  Amount is paid in full or the  final  conversion  of the  Principal
Amount.

3.   Events of Default.  If one or more of the  following  described  "Events of
Default" shall occur,

     a.   Any of the  representations  or warranties made by the Company herein,
or in the Purchase Agreement shall have been incorrect when made in any material
respect; or

                                      -2-
<PAGE>

     b.   The Company  shall fail to perform or observe in any material  respect
any covenant, term, provision, condition, agreement or obligation of the Company
under this Debenture (other than those contained in paragraphs 3.a., 3.c., 3.d.,
3.e.,  and 3.f.  herein)  or the  Purchase  Agreement,  and such  failure  shall
continue  uncured  for a period of ten (10) days after  written  notice from the
Holder specifically describing such failure or, if such failure is by its nature
curable but not curable within thirty (30) days from the date of such notice, if
the Company shall have failed to commence  within such thirty (30) day period in
good  faith to cure such  failure  and shall  have  failed to cure such  failure
within a reasonable time longer than thirty (30) days; or

     c.   A trustee, liquidator or receiver shall be appointed by the Company or
for a substantial part of its property or business without its consent and shall
not be discharged within thirty (30) days after such appointment; or

     d.   Any governmental agency or any court of competent  jurisdiction at the
instance of any governmental agency shall assume custody or control of the whole
or any substantial  portion of the properties or assets of the Company and shall
not be dismissed within thirty (30) calendar days thereafter;

     e.   Bankruptcy  reorganization,  insolvency or liquidation  proceedings or
other  proceedings for relief under any bankruptcy law or any law for the relief
or debtors  shall be  instituted  by or against the Company  and, if  instituted
against  the  Company,  the  Company  shall by any action or answer  approve of,
consent  to  or  acquiesce  in  any  such  proceedings  or  admit  the  material
allegations  of, or default in answering a petition filed in any such proceeding
or such proceedings shall not be dismissed within thirty (30) days thereafter;

     f.   If the  employment  of David  Kenin,  the  Company's  Chief  Executive
Officer,  is terminated or he becomes  "disabled," so that he cannot perform the
essential functions of his position with reasonable accommodation; or

     g.   If the Common Stock to be issued  pursuant to conversion as set out in
Paragraph  (4) of this  Debenture is not delivered to the Holder within ten (10)
business days, then, or at any time thereafter, and in each and every such case,
unless  such  Event of Default  shall have been  waived in writing by the Holder
(which waiver shall not be deemed to be a waiver of any  subsequent  default) at
the option of the Holder and in the  Holder's  sole  discretion,  the Holder may
consider this Debenture immediately due and payable, without presentment, demand
protest  or notice  of any  kind,  all of which  are  hereby  expressly  waived,
anything  herein or in any note or other  instruments  contained to the contrary
notwithstanding,  and Holder may  immediately,  and  without  expiration  of any
period  of  grace,  enforce  any and all of the  Holder's  rights  and  remedies
provided  herein or any other  rights or remedies  afforded by law. It is agreed
that in the event of such action such Holders of Debentures shall be entitled to
receive  all  reasonable  fees,  costs and  expenses  incurred,  including  with
limitation  such  reasonable  fees and expenses of attorneys  (if  litigation is
commenced).

                                      -3-
<PAGE>

4.   Conversion.

4.1  Voluntary  Conversion.  The  Principal  Amount of this  Debenture  shall be
convertible  into Common  Stock,  at the Holder's sole  discretion,  at any time
beginning  August 31,  2000,  in  accordance  with the terms of this  Agreement.
Notwithstanding  the foregoing,  if the Company completes an unsecured financing
in excess of US$1 million after May 30, 2000,  the Holder shall not convert more
than  one-third  of the  Principal  Amount in any  30-day  period  (the  "Vested
Principal  Amount" for such period).  If an Event of Default occurs,  the entire
Outstanding  Amount shall be  convertible  immediately  into Common Stock at the
sole discretion of the Holder.

Common Stock  issuable upon  conversion of the Debenture  will be issued only in
respect to such Vested Principal Amount. The accrued interest payable under this
Debenture shall be added to the Principal  Amount or may be paid in cash, at the
Company's sole option.

If the number of  resultant  shares of Common  Stock would as a matter of law or
pursuant  to  regulatory  authority  require  the  Company  to seek  shareholder
approval of such issuance,  the Company shall, as soon as practicable,  take the
necessary step to obtain such approval.

This Debenture may not be converted by, or on behalf of, a "U.S. Person" as such
term as defined by  Regulation S under the  Securities  Act of 1933,  as amended
(the "1933 Act"),  unless the Common Stock  issuable upon  exercise  thereof has
been  registered  under the 1933 Act and the  securities  laws of all applicable
states of the United States, or an exemption from such registration requirements
is available.

4.2  Conversion Procedure.

     (a)  Notice of  Conversion  pursuant to Section  4.1.  The Holder  shall be
entitled to convert any Vested Principal Amount of this Debenture in whole or in
part into shares of Common Stock, by giving written notice by way of a Notice of
Conversion to the Company at its principal  corporate  office of the election to
convert  the same  pursuant  to Section 4, and shall  state  therein the name or
names in which the certificate or  certificates  for, shares of Common Stock are
to be issued. Such conversion shall be deemed to have been made on the date that
the Notice of Conversion  and the Debenture is actually sent and received by the
Company at its principal offices (each, a "Conversion Date").

     (b)  Surrender of Debenture. The Holder at its sole expense shall surrender
the  Debenture  and the  signed  Notice of  Conversion  to the  Company,  at the
principal  offices of the  Company.  The person or persons  entitled  to receive
shares of Common Stock  issuable upon such  conversion  shall be treated for all
purposes  as the record  holder or holders  of any such  shares of Common  Stock
immediately  prior to the close of business on the date the Notice of Conversion
and the Debenture is delivered.  A new Debenture  representing  the  Outstanding
amount,  if any,  with respect to which this  Debenture  has not been  converted
shall be delivered to the Holder with the certificate issued pursuant to Section
4.2(c).

                                      -4-
<PAGE>

     (c)  Delivery of Stock  Certificates.  As promptly as practicable after the
conversion of this  Debenture  (but in no case later than ten (10) business days
after  receipt  of the  Debenture  and the  signed  Notice of  Conversion),  the
Company,  at its expense,  will issue and deliver by express courier service for
delivery to the Holder of this Debenture a certificate or  certificates  for the
number of full shares of Common Stock issuable upon such conversion, pursuant to
Section  (4.1) of this  Debenture.  In the event that the Common Stock  issuable
upon conversion of the Debenture, is not delivered within ten (10) business days
of the date the Company receives the Debenture and the Notice of Conversion, the
Company shall pay to the Holder,  by wire  transfer,  as liquidated  damages for
such failure and not as a penalty, an amount equal to the difference between (a)
the price of the Common Stock issuable upon conversion of the Debenture pursuant
to the Notice of Conversion  (calculated  as the median price of the closing bid
and offer price on the 11th day as reported by Bloomberg L.P.) and (b) the price
of the Common Stock on delivery of the  certificates  (calculated  as the median
price of the closing bid and offer  price as reported by  Bloomberg  L.P. on the
date the Company's  transfer  agent sends the stock  certificate  plus three (3)
business  days).  Notwithstanding  the  foregoing,  the  Company  shall  not  be
obligated to pay such  liquidated  damages if the median price in (b) is greater
than the median price in (a) or the late  delivery of such  certificate  results
from an event beyond the control of the Company.  Any and all payments  required
pursuant  to  this  paragraph  shall  be  payable  only  in  cash.  The  Company
understands  that a delay in the  issuance of the Common  Stock could  result in
economic loss to the Holder.

     The share certificates shall bear a restrictive legend in substantially the
following form:

     THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
     AS AMENDED  ("SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE AND MAY
     NOT BE SOLD,  TRANSFERRED  OR OTHERWISE  DISPOSED OF EXCEPT  PURSUANT TO AN
     EFFECTIVE  REGISTRATION  STATEMENT OR EXEMPTION FROM REGISTRATION UNDER THE
     FOREGOING LAWS.  ACCORDINGLY,  THIS WARRANT MAY NOT BE SOLD, TRANSFERRED OR
     OTHERWISE  DISPOSED  OF UNLESS (i)  PURSUANT TO AN  EFFECTIVE  REGISTRATION
     UNDER THE SECURITIES ACT OR (ii) IN A TRANSACTION  EXEMPT FROM REGISTRATION
     UNDER  THE  SECURITIES  ACT  AND  UNDER   PROVISIONS  OF  APPLICABLE  STATE
     SECURITIES  LAWS.  HEDGING  TRANSACTIONS  RELATED TO THESE  SECURITIES  ARE
     PROHIBITED UNLESS CONDUCTED IN COMPLIANCE WITH THE SECURITIES ACT.

     (d)  Mechanics and Effect of  Conversion.  No  fractional  shares of Common
Stock shall be issued upon conversion of this Debenture.  In lieu of the Company
issuing  any  fractional  shares  to the  Holder  upon  the  conversion  of this
Debenture,  the  Company  shall pay to the  Holder  the  amount  of  outstanding
principal  that is not so converted,  such payment to be in the form as provided
below. Applicable state, provincial and federal securities laws will not require
any legends on the  certificates  after the Debenture has been  converted.  Upon
conversion of this Debenture, the Company shall be forever released from all its
obligations and liabilities under this Debenture,  except that the Company shall
be obligated to pay the Holder, upon conversion,

                                      -5-
<PAGE>

any interest accrued and unpaid or unconverted to and including the date of such
conversion, and no more.

4.3  Conversion  Default.  Subject to Section  4.4  herein,  if, at any time the
Holder submits a Notice of Conversion  and the Company does not have  sufficient
authorized but unissued shares of Common Stock  available to effect,  in full, a
conversion of the Debentures (a "Conversion  Default",  the date of such default
being referred to herein as the "Conversion  Default  Date"),  the Company shall
issue to the Holder all of the shares of Common Stock which are  available,  and
the Notice of Conversion as to any Debentures  requested to be converted but not
converted  (the  "Unconverted  Shares")  shall become null and void. The Company
shall provide notice of such Conversion Default ("Notice of Conversion Default")
to all existing Holders of outstanding  Debentures,  by facsimile,  within three
(3) business days of such default  (with the original  delivered by overnight or
two day courier). No Holder may submit a Notice of Conversion after receipt of a
Notice of Conversion  Default until the date  additional  shares of Common Stock
are authorized by the Company.

4.4  Redemption by the Company.

     (a)  Right to  Redeem.  Prior to  receipt  of a Notice of  Conversion,  the
Company may, but shall not be require to, redeem for cash the Outstanding Amount
of this  Debenture,  in  whole  or in  part,  at a price  equal  to one  hundred
seventeen  percent (117%) of the redeemed  Outstanding  Amount (the  "Redemption
Price").

     (b)  Notice of  Redemption  pursuant  to  Section  4.4(a).  Subject  to the
Holder's right to convert under Section 4.4(c), the Company shall be entitled to
redeem in cash any Outstanding Amount outstanding under this Debenture, in whole
or in part, by giving  written notice to the Holder of its intent to redeem such
Outstanding  Amount (in  accordance  with Section 14) pursuant to Section 4.4(a)
(the  "Notice of  Redemption"),  and shall  state the amount of the  Outstanding
Amount to be redeemed.  Such Notice of  Redemption  shall be deemed to have been
made on the date that the Notice of  Redemption  is actually sent by the Company
(each, a "Redemption Notice Date").

     (c)  Election  to Convert  Upon  Notice of  Redemption.  Upon  receipt of a
Notice of  Redemption,  the  Holder  shall be  entitled  to  convert  any Vested
Principal  Amount of this Debenture,  in whole or in part, into shares of Common
Stock,  by giving  written  notice by way of a Notice of Conversion  pursuant to
Section  4.2(a),  no later  than ten (10)  business  days  after  receipt of the
Redemption Notice Date (the "Election Period").  Upon such election,  the Vested
Principal Amount of this Debenture pursuant to which the Notice of Conversion is
given shall be converted in  accordance  with the terms of Sections 4.1, 4.2 and
4.3,  and the  Company  may not  redeem  that  particular  amount of the  Vested
Principal  Amount.  Any remaining  Vested  Principal  Amount for which Notice of
Redemption is given shall be redeemed in accordance with Section 4.4.

     (d)  Payment of Redemption  Price.  Within five (5) business days after the
Election Period,  the Company shall,  redeem for cash the Outstanding Amount for
which Notice of Redemption is given at the Redemption  Price,  plus  outstanding
interest if the entire Debenture is

                                      -6-
<PAGE>

redeemed. If the Company fails to pay the redemption amount in cash, within five
(5) business days following the Election  Period,  then the  redemption  will be
declared null and void. The Outstanding Amount for which such redemption is made
shall be treated for all purposes as redeemed  immediately prior to the close of
business on the date the Redemption Price is paid.

5.   Conversion Price Adjustments.

5.1  Adjustments  for Stock  Splits and  Subdivisions.  In the event the Company
should at any time or from time to time after the date of issuance  hereof fix a
record date for the  effectuation  of a split or subdivision of the  outstanding
shares of Common Stock or the  determination of holders of Common Stock entitled
to receive a dividend or the distribution payable in additional shares of Common
Stock or other  securities or rights  convertible  into, or entitling the holder
thereof to receive  directly or  indirectly,  additional  shares of Common Stock
(hereinafter  referred to as "Common Stock Equivalents")  without payment of any
consideration  by such holder for the  additional  shares of Common Stock or the
Common Stock  Equivalents  (including  the  additional  shares of Common  Stock'
issuable upon conversion or exercise thereof),  then, as of such record date (or
the date of such dividend  distribution,  split or subdivision if no record date
is  fixed),  the  Conversion  Price of this  Debenture  shall  be  appropriately
decreased so that the number of shares of Common Stock issuable upon  conversion
of  this  Debenture  shall  be  increased  in  proportion  to such  increase  of
outstanding shares.

5.2  Adjustments  for Reverse  Stock  Splits.  If the number of shares of Common
Stock  outstanding  at  any  time  after  the  date  hereof  is  decreased  by a
combination of the outstanding shares of Common Stock, then following the record
date of such  combination,  the  Conversion  Price for this  Debenture  shall be
appropriately increased so that the number of shares of Common Stock issuable on
conversion  hereof  shall  be  decreased  in  proportion  to  such  decrease  in
outstanding shares.

6.   Merger. If the Company merges or consolidates  with another  corporation or
sells or transfers all or substantially  all of its assets to another person and
the Holders of the Common Stock are  entitled to receive  stock,  securities  or
property in respect of or in exchange for Common  Stock,  then as a condition of
such  merger,  consolidation,  sale  or  transfer,  the  Company  and  any  such
successor, purchaser or transferee shall amend this Debenture to provide that it
may thereafter be converted on the terms and subject to the conditions set forth
above into the kind and amount of stock,  entities or property  receivable  upon
such merger, consolidation, sale or transfer by a Holder of the number of shares
of Common Stock into which this Debenture might have been converted  immediately
before such  merger,  consolidation,  sale or transfer,  subject to  adjustments
which  shall  be as  nearly  equivalent  as may be  practicable  to  adjustments
provided for in Section 5.

The  Company  shall  not   consolidate   or  merge  into,  or  transfer  all  or
substantially  all of its assets to, any person,  unless such person assumes the
obligations  of the Company  under this  Debenture  and  immediately  after such
transaction  no Event of Default  exists.  Any  reference  herein to the Company
shall refer to such surviving or transferee  corporation  and the obligations of
the Company shall terminate upon such assumption.

                                      -7-
<PAGE>

7.   Worn or Lost  Debentures.  If  this  Debenture  becomes  worn,  defaced  or
mutilated but is still substantially intact and recognizable, the Company or its
agent may issue a new  Debenture  in lieu hereof upon its  surrender.  Where the
Holder of this Debenture  claims that the Debenture has been lost,  destroyed or
wrongfully  take,  the  Company  shall  issue a new  Debenture  in  place of the
original  Debenture  if the Holder so requests by written  notice to the Company
actually  received by the Company  before it is notified the  Debenture has been
acquired by a bona fide  purchaser  and Holder has  delivered  to the Company an
indemnity  bond in such amount and issued by such  surety as the  Company  deems
satisfactory  together  with an affidavit of the Holder  setting forth the facts
concerning such loss,  destruction or wrongful taking and such other information
in such form with such proof or verification as the Company may request.

8.   Notices of Record Date.

In the event of:

(i)       Any  taking by the  Company  of record of the  holders of any class of
securities of the Company for the purpose of determining the holders thereof who
are entitled to receive any dividend (other than a cash dividend  payable out of
earned  surplus  at the  same  rate as  that  of the  last  such  cash  dividend
heretofore paid) or other distribution,  or any right to subscribe for, purchase
or otherwise acquire any shares of stock of any class or any other securities or
property, or to receive any other right; or

(ii)      Any capital  reorganization of the Company,  any  reclassification  or
recapitalization  of the capital  stock of the Company or any transfer of all or
substantially  all of the  assets  of the  Company  to any  other  person or any
consolidation or merger involving the Company; or

(iii)     Any voluntary or involuntary dissolution, liquidation or winding up of
the Company.

the  Company  will mail to the holder of this  Debenture  at least five (5) days
prior to the earliest date specified  therein,  a notice specifying (A) the date
on which  any such  record  is to be taken  for the  purpose  of such  dividend,
distribution  or  right;  and (B) the  date on which  any  such  reorganization,
reclassification,  transfer, consolidation,  merger, dissolution, liquidation or
winding up is expected to become  effective and the record date for  determining
stockholders entitled to vote thereon.

9.   Authorized  Shares,  of Common Stock,  Reservation  of Shares.  The Company
shall at the Closing date and from time to time as  required,  so long as any of
the Debentures are outstanding, reserve and keep available out of its authorized
and unissued Common Stock, solely for the purpose of effecting the conversion of
the  Debentures,  such number of shares of Common Stock equal to or greater than
200% of the  number  of shares of  Common  Stock  for  which are  issuable  upon
conversion of all of the then outstanding  Debentures which are then outstanding
or which could be issued at any time under this Debenture.

10.  Assignment. Subject to the restrictions or transfer described in Section 12
below,  the  rights  and  obligations  of the  Company  and the  Holder  of this
Debenture  shall be binding  upon and benefit the  successors,  assigns,  heirs,
administrators, and transferees of the parties.

                                      -8-
<PAGE>

11.  Waiver and Amendment.  This Debenture and the Purchase Agreement constitute
the full and entire understanding and agreement between the parties with respect
to the subject matter hereof and supersedes all prior agreements with respect to
the subject  matter  hereof.  Any  provision of this  Debenture  may be amended,
waived or modified upon the written consent of the Company and Holder thereof.

12.  Restrictions on Transfer. This Debenture and the Common Stock issuable upon
the conversion hereof have not been registered under the Securities Act of 1933,
as amended,  (the "Securities  Act") and have been sold pursuant to Regulation S
under the Securities Act ("Regulation  S"). The Debenture may not be transferred
or resold,  or to a U.S.  Person,  or to or for the account or benefit of a U.S.
Person (as defined in  Regulation  S) for a period of one (1) year from the date
hereof and  thereafter  this  Debenture  and the Common Stock  issuable upon the
conversion thereof may only be offered or sold pursuant to registration under or
an exemption from the Securities Act.

13.  Automatic  Conversion.  In the event all or any  portion of this  Debenture
remains  outstanding on May 30, 2005, the unconverted  portion of such Debenture
will  automatically be converted into shares of Common Stock on such date in the
manner set forth in Section 4.

14.  Grant of Security  Interest.  To secure the prompt and full  payment of all
principal and interest owing to Holder pursuant to this  Debenture,  the Company
hereby  grants to Holder a  security  interest  in all of its  assets,  accounts
receivable and inventory,  now existing or hereafter  arising,  and all proceeds
therefrom. Such security interest shall terminate on the earlier of (i) the date
the Company  completes any  unsecured  financing in excess of $2.5 million after
May 30,  2000 or (ii) this  Debenture  is  redeemed or  converted  in full.  The
Company shall file UCC-1 Financing Statements in the State of California and the
State of Nevada, and, at the written request of the Holder,  execute for filing,
any  additional  financing  statements  or  continuation  statements  as  may be
required from time to time to perfect or continue  Holder's security interest in
such assets.

15.  Notices. Any notice,  request or other communication  required or permitted
hereunder  shall be in  writing  and shall be deemed to have been duly  given if
made by hand delivery, by an express courier company, by registered or certified
mail, or by facsimile transmission, at the respective addresses and/or facsimile
number of the parties as set forth herein.

16.  Governing Law;  Interpretation.  This Agreement, and all exhibits attached,
shall be governed by and construed under the laws of the State of California and
the laws applicable therein without regard to its choice of law principles.  All
disputes should be determined and litigated in the courts of California.

Any litigation  based thereon,  or arising out of, under, or in connection with,
this Agreement shall be brought and maintained  exclusively in the courts of the
State of California. The Company and the Holder hereby expressly and irrevocably
submit to the jurisdiction of the state and federal Courts of California for the
purpose of any such litigation as set forth above and  irrevocably  agrees to be
bound by any final judgment rendered thereby in connection with such litigation.
The  Company  and the Holder  further  irrevocably  consents  to the  service of
process by

                                      -9-
<PAGE>

registered mail,  postage prepaid,  or by personal service within or without the
State of California. The Company and the Holder hereby expressly and irrevocably
waive,  to the fullest extent  permitted by law, any objection which it may have
or hereafter may have to the laying of venue of any such  litigation  brought in
any such court referred to above and any claim that any such litigation has been
brought in any inconvenient forum. To the extent that the Company and the Holder
have or hereafter  may acquire any immunity  from  jurisdiction  of any court or
from any legal process (whether  through service or notice,  attachment prior to
judgment, attachment in aid of execution or otherwise) with respect to itself or
its property. The Company and the Holder hereby irrevocably waives such immunity
in respect of its obligations under this agreement and the other loan documents.

Holder and the Company hereby knowingly, voluntarily and intentionally waive any
rights  they may  have to a trial by jury in  respect  of any  litigation  based
hereon,  or arising out of, under, or in connection  with,  this Agreement.  The
Company and the Holder  acknowledge  and agree that they have  received full and
sufficient  consideration  for this  provision  and  that  this  provision  is a
material inducement for the Company and the Holder entering into this agreement.

Any  legal  action or  proceeding  in  connection  with  this  Agreement  or the
performance  hereof may be brought in the state and  federal  courts  located in
California,  and the  parties  hereby  irrevocably  submit to the  non-exclusive
jurisdiction of such courts for the purpose of any such action or proceeding.

17.  Heading; References. All headings used herein are used for convenience only
and shall not be used to construe or  interpret  this  Debenture.  Except  where
otherwise indicated, all references herein to Sections refer to Sections hereof.

18.  Attorney's  Fees.  Should any party bring an action to enforce the terms of
this  Debenture,  then the  prevailing  party in the action shall be entitled to
recovery of its attorney's fees from the other party.

                                      -10-
<PAGE>

IN WITNESS WHEREOF, the Company has caused this Debenture to be issued this __th
day of May, 2000.

SPORTSPRIZE ENTERTAINMENT INC.

By: /s/ Bruce R. Cameron
    ------------------------------

Name: Bruce R. Cameron

Title: President

Address:      13101 Washington Blvd., Suite 131
              Los Angeles, California  90066
Facsimile:    (310) 566-7150

HOLDER:

By: ------------------------------

Name: ----------------------------

Title: ---------------------------

Address:

                                      -11-
<PAGE>

                              NOTICE OF CONVERSION

(To be Executed by the Registered Holder in order to Convert the Debentures)

     The undersigned hereby  irrevocably  elects, as of -------------- , 200- to
convert $---------- of the Debentures into Shares of Common Stock (the "Shares")
of SPORTSPRIZE  ENTERTAINMENT  INC. (the "Company")  according to the conditions
set forth in the Agreement dated May 30, 2000.

     The undersigned  hereby  represents that it is not a U.S. Person as defined
in Regulation S promulgated under the Securities Act of 1933, as amended, and is
not converting the  Debentures on behalf of any U.S.  Person,  and is not within
the  United  States at the time of  execution  and  delivery  of this  Notice of
Conversion.

Date of Conversion: ---------------------

Number of Shares Issuable
upon this conversion: -------------------

Signature: ------------------------------
                   [Name]

Address: --------------------------------

Phone: ---------------------     Facsimile: ---------------------

                                      -12-
<PAGE>

                              NOTICE OF REDEMPTION

     SPORTSPRIZE  ENTERTAINMENT INC. (the "Company") according to the conditions
set  forth  in  the  Debenture   dated  May  30,  2000  hereby  elects,   as  of
---------------,  200- to redeem  $------------  of the Vested  Principal Amount
and, if applicable, accrued interest of the Debentures.

Date of Redemption: ---------------------

Vested Principal Amount and, if applicable,
accrued interest Redeemed:  ---------------------
x 1.17 = Redemption Amount: ---------------------

HOLDER:

--------------------------------
          [Name]

Phone: ---------------------     Facsimile: ---------------------

SPORTSPRIZE ENTERTAINMENT INC.

By: --------------------------------

Its: -------------------------------

                                      -13-EXHIBIT 10.39

THIS  WARRANT HAS NOT BEEN  REGISTERED  WITH THE UNITED  STATES  SECURITIES  AND
EXCHANGE COMMISSION (THE "COMMISSION") OR THE SECURITIES COMMISSION OF ANY STATE
PURSUANT TO AN EXEMPTION FROM REGISTRATION  UNDER REGULATION S PROMULGATED UNDER
THE  SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").  THIS DEBENTURE  SHALL
NOT  CONSTITUTE  AN  OFFER  TO SELL  NOR A  SOLICITATION  OF AN OFFER TO BUY THE
WARRANT  IN ANY  JURISDICTION  IN  WHICH  SUCH  OFFER OR  SOLICITATION  WOULD BE
UNLAWFUL.

THIS WARRANT MAY NOT BE SOLD,  PLEDGED,  TRANSFERRED OR ASSIGNED EXCEPT PURSUANT
TO AN EFFECTIVE  REGISTRATION  STATEMENT UNDER THE 1933 ACT AND UNDER APPLICABLE
STATE  SECURITIES  LAWS, OR IN A TRANSACTION  WHICH IS EXEMPT FROM  REGISTRATION
UNDER THE  PROVISIONS OF THE 1933 ACT AND UNDER  PROVISIONS OF APPLICABLE  STATE
SECURITIES LAWS; AND IN THE CASE OF AN EXEMPTION.

                         SPORTSPRIZE ENTERTAINMENT INC.

                   WARRANT TO PURCHASE SHARES OF COMMON STOCK

     For value  received,  _______________  at P.O. Box N-1836 (A-93),  East Bay
Shopping  Center,  Nassau,  Bahamas,  its successors or assigns  ("Holder"),  is
entitled to purchase from SPORTSPRIZE  ENTERTAINMENT  INC., a Nevada corporation
(the  "Company"),  the principal  office of which is located at 13101 Washington
Blvd.,  Suite 131, Los Angeles,  California  90066, up to ___________ fully paid
and nonassessable shares of the Company's common stock or such greater or lesser
number of such shares as may be determined by application  of the  anti-dilution
provisions  of this  warrant,  at the  price of $1.275  per  share,  subject  to
adjustments as noted below (the "Warrant Exercise Price").

     This  warrant may be  exercised  by Holder at any time or from time to time
prior to the close of business on May 30, 2002.

     This warrant is subject to the following terms and conditions:

     1. Exercise. The rights represented by this warrant may be exercised by the
Holder, in whole or in part, by written  election,  in the form set forth below,
by the  surrender  of  this  warrant  (properly  endorsed  if  required)  at the
principal  office of the Company,  by payment to it by cash,  certified check or
bank draft of the Warrant  Exercise  Price for the shares to be  purchased.  The
shares so purchased  shall be deemed to be issued as of the close of business on
the date on which this  warrant has been  exercised by payment to the Company of
the Warrant  Exercise Price.  Certificates for the shares of stock so purchased,
bearing an  appropriate  restrictive  legend,  shall be  delivered to the Holder
within 10 days after the rights  represented  by this warrant shall have been so
exercised,  and, unless this warrant has expired, a new warrant representing the
number of shares, if any, with respect to which this warrant has not been

                                      -1-
<PAGE>

exercised  shall also be delivered  to the Holder  hereof  within such time.  No
fractional shares shall be issued upon the exercise of this warrant.

     2.  Shares.  All shares that may be issued upon the  exercise of the rights
represented by this warrant shall, upon issuance, be duly authorized and issued,
fully paid and nonassessable  shares.  During the period within which the rights
represented  by this warrant may be  exercised,  the Company  shall at all times
have  authorized and reserved for the purpose of issue or transfer upon exercise
of the  subscription  rights  evidenced by this  warrant a sufficient  number of
shares of its common stock to provide for the exercise of the rights represented
by this warrant.

     The share certificates evidencing the common stock shall bear the following
restrictive legend:

     THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
     AS AMENDED  ("SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE AND MAY
     NOT BE SOLD,  TRANSFERRED  OR OTHERWISE  DISPOSED OF EXCEPT  PURSUANT TO AN
     EFFECTIVE  REGISTRATION  STATEMENT OR EXEMPTION FROM REGISTRATION UNDER THE
     FOREGOING LAWS.  ACCORDINGLY,  THIS WARRANT MAY NOT BE SOLD, TRANSFERRED OR
     OTHERWISE  DISPOSED  OF UNLESS (i)  PURSUANT TO AN  EFFECTIVE  REGISTRATION
     UNDER THE SECURITIES ACT OR (ii) IN A TRANSACTION  EXEMPT FROM REGISTRATION
     UNDER  THE  SECURITIES  ACT  AND  UNDER   PROVISIONS  OF  APPLICABLE  STATE
     SECURITIES  LAWS.  HEDGING  TRANSACTIONS  RELATED TO THESE  SECURITIES  ARE
     PROHIBITED UNLESS CONDUCTED IN COMPLIANCE WITH THE SECURITIES ACT.

     3.  Adjustment.  The Warrant  Exercise Price shall be subject to adjustment
from time to time as hereinafter provided in this Section 3:

          (a) If the Company at any time divides the  outstanding  shares of its
     common stock into a greater number of shares  (whether  pursuant to a stock
     split,  stock dividend or otherwise),  and  conversely,  if the outstanding
     shares of its common  stock are combined  into a smaller  number of shares,
     the Warrant Exercise Price in effect  immediately prior to such division or
     combination shall be  proportionately  adjusted to reflect the reduction or
     increase in the value of each such common share.

          (b) If any capital  reorganization or  reclassification of the capital
     stock of the  Company,  or  consolidation  or  merger of the  Company  with
     another corporation,  or the sale of all or substantially all of its assets
     to another  corporation shall be effected in such a way that holders of the
     Company's  common stock shall be entitled to receive  stock,  securities or
     assets with respect to or in exchange  for such common  stock,  then,  as a
     condition of such reorganization,  reclassification,  consolidation, merger
     or sale,  the Holder  shall have the right to purchase and receive upon the
     basis and upon the terms and  conditions  specified  in this warrant and in
     lieu  of the  shares  of  the  common  stock  of  the  Company  immediately
     theretofore purchasable and receivable upon the exercise of the

                                      -2-
<PAGE>

     rights represented hereby, such shares of stock, other securities or assets
     as would  have  been  issued or  delivered  to the  Holder  if  Holder  had
     exercised  this  warrant  and had  received  such  shares of  common  stock
     immediately prior to such reorganization, reclassification,  consolidation,
     merger or sale. The Company shall not effect any such consolidation, merger
     or sale unless prior to the consummation thereof the successor  corporation
     (if other than the Company)  resulting from such consolidation or merger or
     the corporation  purchasing such assets shall assume by written  instrument
     executed  and  mailed  to the  Holder  at the last  address  of the  Holder
     appearing  on the books of the  Company  the  obligation  to deliver to the
     Holder such shares of stock,  securities or assets as, in  accordance  with
     the foregoing provisions, the Holder may be entitled to purchase.

          (c) If the  Company  takes any  other  action,  or if any other  event
     occurs,  which does not come within the scope of the  provisions of Section
     3(a) or 3(b),  but which  should  result in an  adjustment  in the  Warrant
     Exercise Price and/or the number of shares subject to this warrant in order
     to fairly  protect  the  purchase  rights  of the  Holder,  an  appropriate
     adjustment in such purchase rights shall be made by the Company.

          (d) Upon each  adjustment of the Warrant  Exercise  Price,  the Holder
     shall  thereafter be entitled to purchase,  at the Warrant  Exercise  Price
     resulting  from  such   adjustment,   the  number  of  shares  obtained  by
     multiplying the Warrant Exercise Price in effect  immediately prior to such
     adjustment by the number of shares purchasable  pursuant hereto immediately
     prior to such  adjustment  and dividing the product  thereof by the Warrant
     Exercise Price resulting from such adjustment.

          (e) Upon any  adjustment of the Warrant  Exercise  Price,  the Company
     shall  give  written  notice  thereof  to the Holder  stating  the  Warrant
     Exercise Price resulting from such adjustment and the increase or decrease,
     if any, in the number of shares purchasable at such price upon the exercise
     of  this  warrant,  setting  forth  in  reasonable  detail  the  method  of
     calculation and the facts upon which such calculation is based.

     4. No Rights as  Shareholder.  This warrant shall not entitle the Holder to
any voting rights or other rights as a shareholder of the Company.

     5. Transfer.  This warrant and all rights  hereunder are  transferable,  in
whole or in part, at the principal office of the Company by the holder hereof in
person or by duly authorized  attorney,  upon surrender of this warrant properly
endorsed.  The  bearer of this  warrant,  when  endorsed,  may be treated by the
Company and all other  persons  dealing with this warrant as the absolute  owner
hereof  for any  purpose  and as the  person  entitled  to  exercise  the rights
represented  by this  warrant,  or to the  transfer  hereof  on the books of the
Company, any notice to the contrary notwithstanding;  but until such transfer on
such books,  the Company may treat the registered  owner hereof as the owner for
all purposes.

     6.  Notices.  All  demands  and  notices  to be  given  hereunder  shall be
delivered  or sent by first  class  mail,  postage  prepaid;  in the case of the
Company,  addressed to its corporate  headquarters,  located at 13101 Washington
Blvd., Suite 131, Los Angeles,  California 90066, until a new address shall have
been substituted by like notice; and in the case of Holder,

                                      -3-
<PAGE>

addressed to Holder at the address written below, until a new address shall have
been substituted by like notice.

     IN WITNESS WHEREOF,  the Company has caused this warrant to be executed and
delivered by a duly authorized officer.

Dated:  May 30, 2000

SPORTSPRIZE ENTERTAINMENT INC.

By: ------------------------------

Name: ----------------------------

Title: ---------------------------

Holder:

                                      -4-
<PAGE>

                                WARRANT EXERCISE

                (To be signed only upon exercise of this warrant)

The undersigned,  the Holder of the foregoing warrant, hereby irrevocably elects
to exercise the purchase right  represented by such warrant for, and to purchase
thereunder, __________ shares of common stock of SportsPrize Entertainment Inc.,
to which such warrant relates and herewith makes payment of $__________ therefor
in cash,  certified check or bank draft and requests that the  certificates  for
such shares be issued in the name of, and be delivered to  ____________________,
whose address is set forth below the signature of the undersigned.

Dated: ---------------------

------------------------------------------
               Signature

If shares are to be issued other than to Holder:      Social Security No. /
(Name/Address)                                        Tax Identification No.

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

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

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

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

                                      -5-
<PAGE>

                               WARRANT ASSIGNMENT

                (To be signed only upon transfer of this warrant)

For value  received,  the undersigned  hereby sells,  assigns and transfers unto
_______________  the right  represented by the foregoing warrant to purchase the
shares  of  common  stock  of  SportsPrize   Entertainment   Inc.  and  appoints
____________________ attorney to transfer such right on the books of SportsPrize
Entertainment Inc., with full power of substitution in the premises.

Dated: ---------------------

------------------------------------------
               Signature

If shares are to be issued other than to Holder:      Social Security No. /
(Name/Address)                                        Tax Identification No.

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

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

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

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