Exhibit 10.12
THIS AGREEMENT is entered into this day of February, 2001.
BY AND BETWEEN:
SMD PABLO ENTERTAINMENT, a corporation incorporated pursuant
to the Laws of Island of Antigua, with its registered offices
in Antigua;
(hereinafter referred to as "SMD")
OF THE FIRST PART
AND
PLAYSTAR CORPORATION, a corporation incorporated pursuant to
the Laws of the Island of Antigua with its registered
offices in St. John's Antigua, West Indies;
(hereinafter referred to as "Playstar" )
OF THE SECOND PART
WHEREAS Playstar wishes to purchase the web site Xxxxxxxxxxxx.xxx URL
from SMD;
AND WHEREAS Playstar wishes to purchase from SMD the software necessary
for the creation of an Internet game show using the Xxxxxxxxxxxx.xxx web
address;
AND WHEREAS SMD agrees to develop a software program for an Internet
Game Show using the Xxxxxxxxxxxx.xxx web address;
AND WHEREAS Playstar shall own all rights to the software program for
the Internet Game Show using the Xxxxxxxxxxxx.xxx web address;
NOW THEREFORE, in consideration of the premises and mutual covenants
herein set forth, the Parties agree as follows:
A. GENERAL PROVISIONS
1. Definitions
1.0 "Software Program" shall mean a licensed data processing program or
micro program consisting of a series or sequence of signals, or
instructions, statements or fonts stored on any media in machine
readable form, and any related licensed materials such as, but not
limited to, graphics, flow charts, logic diagrams, manuals, and listing
created by SMD for use in connection with an Internet Game Show to be
used on the Xxxxxxxxxxxx.xxx web address more particularly described
herein.
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1.1 "Hardware" shall mean all the necessary computers, routers, cabling,
monitors, hard drives, back-up systems, and other equipment recommended
by SMD and mutually agreed upon between the parties hereto.
1.2 "Game Show" shall mean the Internet Game Show "Questforcash" which
shall be played using the Software Program on the web site
Xxxxxxxxxxxx.xxx as available from time to time.
1.3 "Customer Information" shall mean all data collected and stored on
customers including, without limiting the generality of the foregoing,
name, address, phone and fax number, e-mail address, credit card
numbers and expiration dates or information on other types of payments,
amounts collected and frequency of prize winnings.
1.4 "Confidential Information" shall mean material in the possession of
Playstar which is not generally available to or used by others or the
utility or value of which is not generally known or recognized as
standard practice, including, without limitation, all financial
business and personal data relating to Playstar clients, any non-public
information about affiliates, subsidiaries, consultants and employees
of Playstar or its affiliates, business and marketing plans, strategies
and methods, studies, charts, plans, tables and compilations of
business industrial information, computer software and computer
technology whether patentable, copyrightable or not, which is acquired
or developed by or on behalf of Playstar or its affiliates from time to
time.
1.5 "Net Revenue" for the purposes of this Agreement, Net Revenue is
defined as the total gross collected by Playstar through the
Xxxxxxxxxxxx.xxx web site, less monies paid out in prizes, less
operating expenses.
1.6 "Parties" shall mean the SMD and Playstar.
B. SOFTWARE PROGRAM AND XXXXXXXXXXXX.XXX WEB SITE
2. Questforcash
2.0 SMD shall create and provide a completed and fully integrated high
quality Software Program ("Questforcash ") designed to successfully
operate an Internet Game Show for use on the web site Xxxxxxxxxxxx.xxx
for Playstar.
2.1 The Questforcash Software Program developed hereunder and all source
codes related thereto shall become and remain the property of Playstar
with full right, and title thereto.
2.2 SMD hereby transfers all of its right title and interest in the Web
Site Xxxxxxxxxxxx.xxx which Web Site has already been established and
is fully
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operational to Playstar.
2.3 SMD further transfers to Playstar all of its right title and interest
in the Software Program, which program is to be developed for the
Internet Game Show Questforcash on the Web Site already established as
Xxxxxxxxxxxx.xxx.
2.4 The Parties agree that all material costs of the development of the
Questforcash Software Program and the operation of the web site
Xxxxxxxxxxxx.xxx shall be the sole responsibility of Playstar from the
date of execution of this Agreement.
3. Consideration
3.0 Subject to the performance by SMD of its obligations under Article 2
herein, Playstar shall provide to SMD with One Million (1,000,000) free
trading shares of Playstar, upon completion of the transfer of the Web
Site and Software Program to Playstar.
3.1 SMD of Antigua agrees to make every effort to aid Playstar in the
development of this Game Show concept.
3.2 SMD shall be entitled to receive, in return for the management services
provided herein fifteen percent (15%) of the Net Revenue payable on a
monthly basis.
3.3 Playstar shall supply the Hardware necessary to run Questforcash
Software Program;
3.4 Either Party may cancel the Management Services of the Xxxxxxxxxxxx.xxx
web site upon ninety (90) days written notice to the other party, no
sooner than three (3) months from the launch of the site. In the event
of termination, Playstar shall be responsible for all outstanding
player accounts.
4. Warranty
4.0 Playstar warrants and represents that the Questforcash Software Program
developed by SMD will be operational no later than twelve (12) months
from the execution of this Agreement.
5. Indemnification
5.0 SMD acknowledges and agrees that neither Playstar nor any of its
members, shareholders, directors, officers, employees or
representatives shall be liable to SMD or any of SMD's customers for
any special, indirect, consequential, punitive or exemplary damages, or
damages for loss of profits or savings, in connection with this
Agreement, the services or the Hardware or any other information,
material or services provided by Playstar to SMD under this Agreement.
If, despite the foregoing limitations, Playstar or any of its
shareholders, directors, officers, employees or representatives are
held responsible by any court of
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competent jurisdiction then their damages for all such things and to
all such parties will be limited to the lesser of the actual amount of
loss or damage suffered by the Claimant or the amount of SMD's fees
payable by SMD to Playstar for the six months prior to the loss.
5.1 SMD shall indemnify and save harmless Playstar and its members,
shareholders, directors, officers, employees, agents, contractors,
representatives, parent company, or subsidiaries (together, the
"Indemnified Parties") from and against all damages, losses, costs and
expenses (including actual legal fees and costs), fines and liabilities
incurred by or awarded asserted or claimed against any of the
Indemnified parties by any licensing or government agency who licenses,
regulates, or otherwise governs the licensing or use of Internet
gambling in connection with SMD's activities under this Agreement,
including claims brought by a person using or relying upon any advice
given or publication produced and distributed by SMD.
5.2 SMD acknowledges that Playstar's ability to perform its obligations
under this Agreement are subject to government licensing in whatever
jurisdiction SMD may choose to operate. Playstar shall not be held
liable for any damages of any kind whatsoever that may result from
changes in government legislation or policy.
5.3 Neither Party shall be held responsible for failure of performance of
Agreement due to causes beyond its control, including, but not limited
to, work stoppages, fires, civil disobedience, riots, rebellions, acts
of god, and similar occurrences.
6. Term and Termination
6.0 This Agreement shall commence and be deemed effective on the date when
fully executed (the "Effective Date"). This Agreement is in effect for
the life of the Web Site and in any event no less than five (5) years
from the Effective Date hereof.
6.1 Playstar may terminate this Agreement at any time upon fifteen (15)
days written notice if SMD becomes bankrupt or insolvent or ceases
carrying on business for any reason.
6.2 SMD may terminate this Agreement at any time upon fifteen (15) days
notice if Playstar becomes bankrupt or insolvent or ceases carrying on
business for any reason.
7. Accounting
7.0 Playstar shall maintain records of all transactions and xxxxxx placed
on the Web Site.
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7.1 No fees are payable for regular accounting information provided to SMD
for the purpose of calculating Net Revenue.
7.2 Playstar shall provide weekly interim accounting reports, and as
requested from time to time. The weekly interim accounting records
shall be delivered either by facsimile or by e-mail.
7.3 SMD shall have the right to utilize the accounting information for
statistical and reporting purposes provided specific information about
Playstar and its individual customers is not disclosed.
7.4 Playstar shall archive and maintain the accounting information for a
prior period of two (2) fiscal years on a continuing basis.
7.5 SMD shall be given thirty days written notice prior to the destruction
of any accounting information. SMD may choose to archive information
about to be destroyed, at its own facilities.
8. Customer Data
8.0 Playstar shall maintain a database containing the Customer Information.
8.1 The Customer Information shall remain the property of Playstar.
8.2 SMD and its related parties will treat this "customer information" as
confidential information and will not disclose this information to any
third party for any reason whatsoever.
C. OBLIGATIONS OF THE PARTIES
9. Marketing
9.0 Playstar shall be responsible for marketing all aspects (both online
and offline) of the development and on-going operation of the Internet
Game Show, including but not limited to: design, strategic planning,
advertising campaigns, affiliate programs, customer reward programs.
All direct costs of Marketing shall be borne and will be an expense of
the operation of the Playstar. SMD to supply marketing help wherever
possible.
10. The Web Site
10.0 If requested, Playstar shall construct and maintain any and all
additional Web Sites they deem necessary for the marketing of the
Software Program. All work done to build additional web sites shall be
borne by Playstar.
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10.1 After the first Web Site is created by SMD, SMD shall not in any way be
responsible for the design of the Web Sites utilized by Playstar.
11. Representations and Warranties
11.0 Each of the parties hereto hereby represents and warrants unto each
other as follows:
11.1 It has full power, authority and legal right to incur the obligations
provided for in this Agreement, to execute and delivery this Agreement,
to perform and observe the terms and provisions hereof and has the
corporate power and authority, and the requisite licenses to own its
properties as now owned and operated.
11.2 This Agreement constitutes the legal, valid and binding obligation of
such Party, enforceable against it in accordance with the terms hereof.
11.3 The execution, delivery and performance of this Agreement have been
duly authorized by all necessary action, corporate or otherwise, on the
part of such Party.
11.4 The execution, delivery and performance of this Agreement will not
violate or exceed the power of such Party, or contravene (i) any
provision of any applicable law, regulation, decree or order to which
such Party is subject; (ii) any provision of the memorandum and article
of association, charter or constitutive documents of such party; or
(iii) any provision of any contract or agreement to which such Party is
a party, or under which it or its assets is found.
11.5 All authorizations, consents, permits approvals and licenses required
for the execution, delivery and performance of this Agreement have been
or will be duly obtained or granted and are or will be in full force
and effect.
11.6 Any material breach of the Representations and Warranties shall be
considered a breach of this Agreement entitling the aggrieved party to
whatever remedies provided under this contract.
D. STANDARD CLAUSES
12. Confidentiality
12.0 SMD shall not disclose, publish, or disseminate Confidential
Information to anyone other than those of its employees, affiliates or
others with a need to know, and SMD agrees to take reasonable
precautions to prevent any unauthorized use,
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disclosure, publication, or dissemination of Confidential Information.
SMD agrees not to use Confidential Information otherwise for its own or
any third party's benefit without the prior approval of an authorized
representative of Playstar in each instance. SMD and Playstar agree to
keep the existence of this Agreement confidential and not to make any
public announcement in relation to, or public comment on, this
agreement unless such public announcement or comment has been mutually
agreed upon.
12.1 All Confidential Information, and any Derivatives thereof created by
Playstar; remains the property of Playstar and no license or other
rights to Confidential information is granted or implied hereby. For
purposes of this Agreement, "Derivatives" shall mean: (a) for
copyrightable or copyrighted material, any translation, abridgement,
revision or other form in which an existing work may be recast,
transformed or adapted; (b) for patentable or patented material, any
improvement thereon; and (c) for material which is protected by trade
secret, any new material derived from such existing trade secret
material, including new material which may be protected by copyright,
patent and/or trade secret.
13. Notices
13.0 Unless otherwise provided in Agreement, any notice provided for under
Agreement shall be in writing and shall be sufficiently given if
delivered personally, or if transmitted by facsimile and/or e-mail with
an original signed copy delivered personally within twenty-four hours
thereafter, or mailed by prepaid registered post addressed to SMD
and/or Playstar at their respective addresses set forth below or at
such other than current address as is specified by notice.
To: SMD:
To: Playstar: Mutual Financial Centre Factory Road
St. John's Antigua
X.X. Xxx x 0000, Xxxxx Xxxxxx
Xxxxxxx, XX
14. Entire Agreement
14.0 The Parties agree that Agreement, constitute the complete and exclusive
statement of the terms and conditions between SMD and Playstar covering
the performance hereof and cannot be altered, amended or modified
except in writing executed by an authorized representative of each
party. SMD further agrees that any terms and conditions of any purchase
order or other instrument issued by SMD in
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connection with Agreement which are in addition or inconsistent with
the terms and conditions of Agreement shall not be binding on Playstar
and/or on SMD and shall not apply to Agreement.
15. Governing Law and Arbitration
15.0 This Agreement shall be governed by and construed in accordance with
the laws of the Island of Antigua, and SMD hereby attorns to the
jurisdiction of the courts of Antigua notwithstanding any other
provision expressed or implied in the Agreement. Any dispute in
connection with Agreement shall be settled by arbitration in accordance
with any Arbitration Act agreed upon between the parties; provided,
however, should any dispute arise under Agreement, the parties shall
endeavor to settle such dispute amicably between themselves. In the
event that the parties fail to agree upon an amicable solution, such
dispute shall be finally determined by arbitration as aforesaid.
16. Good Faith
16.0 The parties acknowledge to one another that each respectively intends
to perform its obligations as specified in Agreement in good faith and
will mutually assist and support each other and its consultants in the
development of the multi-entertainment Internet Game Show in the
interest of helping to maximize is over success.
17. Parties to Act Reasonably
17.0 The parties agree to act reasonably in exercising any discretion,
judgment, approval or extension of time that may be required to effect
the purpose and intent of Agreement. Whenever the approval or consent
of a party is required under Agreement, such consent shall not be
unreasonably withheld or delayed.
18. Time
18.0 Time is of the essence.
19. Number and Gender
19.0 In this Agreement the use of the singular number includes the plural
and vice versa the use of any gender includes all genders, and the word
"person" includes an individual, a trust, a partnership, a body
corporate and politic, and association and any other incorporated or
unincorporated organization or entity.
20. Captions
20.0 Captions or descriptive words at the commencement of the various
sections are
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inserted only for convenience and are in no way to be construed as a
part of Agreement or as a limitation upon the scope of the particular
section to which they refer.
21. Benefit
21.0 This Agreement shall enure to the benefit of and be binding upon SMD,
its successors and permitted assigns.
22. Waiver
22.0 No condoning, excusing or waiver by any party hereto of any default,
breach of non-observance by any other party hereto, at any time or
times with respect to any covenants or conditions herein contained,
shall operate as a waiver of that party's rights hereunder with respect
to any continuing or subsequent default, breach or non-observance, and
no waiver shall be inferred from or implied by any failure to exercise
any rights by the party having those rights.
23. Further Assurances
23.0 Each of the parties hereto hereby covenants and agrees to execute such
further and other documents and instruments and to do such further and
other things as may be necessary to implement and carry out the intent
of Agreement.
24. Cumulative Rights
24.0 All rights and remedies of Playstar and SMD are cumulative and are in
addition to and shall not be deemed to exclude any other rights or
remedies allowed by law except as specifically limited hereby. All
rights and remedies may be exercised concurrently.
25. Prior Agreements
25.0 Except as specifically provided for herein, this Agreement contains all
of the terms agreed upon by the parties with respect to the subject
matter herein and supersedes all prior agreements, arrangements and
understandings with respect thereto, whether oral or written.
26. Severability
26.0 If any part of Agreement is unenforceable because of any rule of law or
public policy, such unenforceable provision shall be severed from
Agreement, and this severance shall not affect the remainder of
Agreement.
27. No Partnership
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27.0 Notwithstanding anything in this Agreement, no part of this Agreement,
nor the Agreement as a whole shall be construed as creating a
partnership or agency relationship between the parties. If any part of
this Agreement should become construed as forming a partnership or
agency relationship, that part shall be amended such that no
partnership or agency relationship is created, but that part achieves
what it was originally intended to achieve.
28. Dollar Amounts
28.0 All references to money or specific dollar amounts in this Agreement
are in United States Dollars.
29. Interpretation
29.0 In the interpretation of this Agreement or any provision hereof, no
inference shall be drawn in favour of or against any Party by virtue of
the fact that one party or its agents may have drafted this Agreement
or such provision. Notwithstanding the above, if there is any
uncertainty in the interpretation of this Agreement, the uncertainty
arising in dispute shall be settled by arbitration in accordance with
Section 20.0 (entitled "Governing Law and Arbitration") of this
Agreement.
IN WITNESS WHEREOF the parties have executed Agreement on the date
first written.
SMD PABLO ENTERTAINMENT
Per: /s/ Xxxxxxx Smoskowitz
-----------------------------------
Authorized Signing Officer
PLAYSTAR CORPORATION
Per: /s/ Xxxxxxx Xxxxxxxxxx
-----------------------------------
Authorized Signing Officer
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