Kendra will receive 50 per cent from her sex tape sales
The Playboy model has brokered a deal which will see her take home the cut from any sales of the proposed DVD, which is being released by porn distributors Vivid.
It has also been revealed Kendra`s co-star in the X-rated tape is her ex-boyfriend, mixed martial arts fighter Justin Frye, who was paid $100,000 by Vivid for the footage, according to RadarOnline.com.
A source said: "They have cut a deal."
The blonde beauty initially tried to block the release of the tape, which will be titled `Kendra Exposed`, when news of it first emerged, but after allegedly realising the earning potential of the DVD she decided to enter negotiations with the company.
Kendra and Justin, 28, dated when she was still in high school and they were living in San Diego, but the 24-year-old model separated from him and eventually began romancing Hugh Hefner and moved into the Playboy Mansion with him, becoming a huge star.
The source said: "Justin had a tripod in his bedroom for the camera and a stripper pole in the apartment. Kendra definitely was not shy about being in these tapes. There are tapes of Kendra in really compromising positions- doing a lot of embarrassing things.
"It was a bad break-up... as soon as Hef took her, she was gone. But Justin knew what he had. He waited until Kendra`s fame hit a certain level."
It has also been claimed Kendra - who has a four-month-old son, Hank Baskett IV, with her American footballer husband Hank Baskett - tried to sell a sex tape herself in 2008 through her company Home Run Productions, LLC. The proposed release never materialised.