FTC

                                COMMERCIAL CORP.



                               FACTORING AGREEMENT



TO;       VERSATILE ENTERTAINMENT, INC.              DATE:      October 14, 2004

          145 EAST 35TH STREET

          LOS ANGELES, CA 90011



Ladies and Gentlemen:



         This  Factoring   Agreement  (the  "AGREEMENT")  sets  out  the  terms,

provisions and conditions on which we will act as your factor.



1.       PURCHASE OF ACCOUNTS:



         We will purchase  from you and you will sell to us accounts  receivable

created by your  sales of goods to or  performance  of  services  for  customers

approved by us in amounts  approved by us without recourse to you for insolvency

or nonpayment for financial inability to pay, except as set forth herein,  after

the goods or services  have been  actually  delivered  to and  finally  accepted

without claim or dispute by your customer.  An "account receivable" or "account"

means any right to payment of a monetary  obligation which is the net amount due

from a  customer  for all  sales of goods or  performance  of  services  to such

customer whether performed or yet to be performed. You will tender to us for our

approval or rejection,  which such approval or rejection  shall be determined in

our sole  discretion,  all of your accounts except those which we have agreed in

writing  that you may  exclude  (as set  forth in the list  attached  hereto  as

SCHEDULE  A and  modified  from time to time).  This  Agreement  applies  to all

accounts  heretofore or hereafter  purchased by us from you. We may at any time,

in our sole  discretion,  revoke our approval of any of your customers or reduce

the maximum  amount which you may bill to any customer,  but such  revocation or

reduction  shall neither  affect sales where goods have been shipped or services

have been  performed  nor render us liable to you or any other  person or entity

for any loss or damage sustained by reason thereof.



         You shall pay us a one-time  set-up and integration fee of zero dollars

($0.00) for setting you up in our system (including establishment of the Reserve

Account).  Such set-up and integration fee shall also cover the initial addition

of your customer base to our computer system and further introduction of any new

customers  for a  period  of six (6)  months  from  the  effective  date of this

Agreement.



         The customer shall be deemed  insolvent if: (a) the customer shall have

absconded;  (b) the customer becomes  insolvent as defined in Section 101(32) of

the  Bankruptcy  Code; (c) a receiver shall have been appointed for the customer

or its assets; (d) the customer shall have made a general offer of compromise to

his creditors for less than his indebtedness;  (e) the customer's stock in trade

shall have been taken  possession of or sold under a security  agreement or writ

of attachment or sold or transferred in bulk or otherwise sold out of the normal

course of business;  (f) the customer's business shall have been assigned to, or

taken over by an  assignee  or trustee  for the  benefit of his  creditors  or a

committee appointed by his creditors;  (g) a voluntary or involuntary proceeding

shall have been  instituted  with respect to the customer under any  bankruptcy,

reorganization,  receivership or other law providing for the financial relief of

debtors;  (h) the  customer  has  stated  to us a  financial  inability  to pay;

provided,  however,  that  insolvency  shall not be deemed to have occurred when

Home        Intelligence        Services        Subscriptions        News        About Us

Contact Us       Terms of Use       Resend Documents       Shopping Cart

Copyright © 2008 The Consus Group LLC