CONSULTING AGREEMENT
Exhibit
10.3
This
Consulting Agreement
(the
“Agreement”)
is
entered into as of September 13, 2006, by and between Xxxxxxx X. Mix
(“Consultant”),
whose
principal address is ______________________, and Spectre Gaming, Inc., a
Minnesota corporation (the “Company”),
with
its principal place of business located at 00000 00xx Xxxxxx X., Xxxxxxxxxxx,
Xxxxxxxxx 00000. The parties are entering into this Agreement in connection
with
that certain Separation and Release Agreement by and between the parties and
of
even date herewith (the “Separation
Agreement”).
1.
Consulting
Services; Consulting Fee.
The
Company hereby retains the services of Consultant in connection with strategic
legal and regulatory compliance matters, strategic general business consulting
services, and assisting the Company with the identification, hire (by the
Company) and training of one or more persons (within the first two months of
the
term of this Agreement) who will focus on providing the Company with long-term
legal and regulatory compliance services (collectively referred to herein as
the
“Services”).
Consultant will provide the Services on a part-time and as-needed basis.
Consultant will be paid an annual consulting fee of Ninety-Nine Thousand One
Hundred Sixty-Two and No/100 Dollars ($99,162.00), payable in arrears on a
once
monthly basis in installments as follows (the “Consulting
Fee”):
(a)
for the first two months after the date hereof, $14,166 per month; and for
the
remainder of the term of this Agreement, $7,083 per month.
2.
Independent
Contractor.
Consultant is an independent contractor, and Consultant’s employees, affiliates,
assistants, contractors, agents and representatives (if any) are not, and will
not be deemed to be, employees of Company. Consultant will have the right to
control and direct the means, manner and method by which the Services required
by this Agreement will be performed. Nevertheless, the Services of Consultant
will conform to all specifications of the Company. Consultant will have the
right to perform the Services required by this Agreement at any place or
location, and at such times, as Consultant may determine except in those cases
where Company requires the Services to be performed at a specific location
and/or during normal work hours; provided,
however,
that if
the Company so requires Services to be performed at a specific location, the
Company will reimburse Consultant’s reasonable travel expenses. Consultant will
furnish all equipment and materials required to provide the Services required
under this Agreement, except to the extent that Consultant’s work must be
performed on or with Company’s equipment and/or materials.
3.
Term.
This
Agreement shall commence on the date of its execution and continue for a
one-year period thereafter (the “Term”),
subject to early termination pursuant to the following paragraphs:
(a)
This
Agreement shall terminate immediately upon Consultant’s death; and
(b)
The
Company may terminate this Agreement for Cause. For purposes of this Agreement,
“Cause”
shall
mean: (i) any acts or omissions by Consultant which demonstrate a failure by
Consultant to substantially perform the Services required under this Agreement,
or which may otherwise constitute a breach of this Agreement, and which failure
is not cured by Consultant or are not capable of being cured by Consultant
within ten days after the Company delivers written notice of such failure to
Consultant; (ii) Consultant’s conviction of a felony (whether or not such
conviction is pending appeal); (iii) any act of fraud or misappropriation by
the
Consultant against the Company or otherwise; (iv) Consultant’s violation of any
terms or conditions of the Separation Agreement, specifically including but
not
limited to the provisions of Section 7 of the Separation Agreement.
4.
Confidentiality.
(a)
For
purposes of this Agreement, the term “Confidential
Information”
shall
include any and all confidential or proprietary information or material
disclosed to or known by Consultant as a consequence of or in any way connected
with this Agreement or the relationship contemplated hereby (in either case,
the
“Consulting
Relationship”)
and
which relates to the Company’s business, financial projections and/or
information, trade secrets, know-how, technical data, software development,
licenses, products, marketing and marketing ideas, accounting, merchandising,
sales, relationships, concepts, procedures or processes and any other
proprietary information relating the Company’s business as it is conducted now
or hereafter proposed to be conducted. All information having been or later
disclosed to Consultant, to which Consultant presently has or later obtains
access or of which Consultant is or becomes knowledgeable or familiar in
connection with the Consulting Relationship (whether originated by the Company,
Consultant or by others), whether or not reduced to writing, and whether or
not
in human readable or machine readable form, will be presumed to be Confidential
Information hereunder. Confidential Information also includes any and all
information which the Company obtains from a third party and treats or
designates as confidential information, whether or not owned or developed by
Company. Notwithstanding the foregoing, the term “Confidential Information” will
not apply to information which (i) Consultant can establish by documentation
was
known to Consultant prior to the date hereof and not otherwise in violation
of
Consultant’s confidentiality obligations under the Separation Agreement; (ii) is
lawfully disclosed to Consultant by a third party not deriving such information
from the Company; (iii) is presently in the public domain or becomes a part
of
the public domain through no fault of Consultant; or (iv) is independently
developed by the Consultant without the use of Confidential Information, as
can
be demonstrated by contemporaneous written evidence.
(b)
Consultant
acknowledges that, in the course of the Consulting Relationship, Consultant
will
acquire or have access to Company’s Confidential Information, which is a
valuable asset of Company, is proprietary to Company, and properly the subject
of protection. From the date of this Agreement, Consultant will hold all
Confidential Information in the strictest confidence and never directly or
indirectly disseminate, disclose or otherwise make available to any third party,
or use for Consultant’s or any third party’s benefit (other than as expressly
provided in writing), any Confidential Information without the prior express
written consent of the Company. Consultant will at all times maintain control
over any Confidential Information obtained from the Company, and will establish
and maintain safeguards against the destruction, loss, alteration of or
unauthorized access to Confidential Information in Consultant’s possession. Upon
Company’s written authorization permitting Consultant to provide or disclose any
Confidential Information to a third party, Consultant agrees to advise and
inform any third party to whom he, she or it has provided access to the
Confidential Information of its confidential nature, and further agrees to
ensure that any such third party independently agree in writing to be bound
by
the terms of this Agreement relating to confidentiality.
(c)
All
Confidential Information will at all times remain the sole property of Company.
All documents and tangible items provided to or obtained by Consultant in
connection with the Consulting Relationship which disclose or embody
Confidential Information, and all documents and tangible items created by
Consultant for use in memorializing, recording or analyzing any Confidential
Information (including all copies, recordings, notes or reproductions of any
kind), are the sole and exclusive property of the Company and shall be promptly
returned to the Company or destroyed upon termination of the Consulting
Relationship or the Company’s request.
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5.
Inventions.
(a)
Consultant
agrees that all “Inventions” (as defined below) shall be the sole and exclusive
property of the Company. More specifically, Consultant hereby acknowledges
and
agrees that, to the fullest extent permitted by applicable law, all Inventions
shall be “works made for hire” as defined in 17 U.S.C. § 101, as amended (and as
such concept is similarly defined under any applicable foreign laws), and as
such will constitute the sole and exclusive property of the Company without
any
further action required on the part of either party hereto. To the extent that
any Invention does not qualify as works made for hire, Consultant hereby assigns
to the Company any and all rights to all Inventions. If the foregoing assignment
is invalid or ineffective for any reason, then Consultant hereby grants the
Company a perpetual, royalty-free, non-exclusive, worldwide license to fully
exploit any intellectual property or propriety rights in the Invention, and
any
patents, copyrights and/or trademarks (or other intellectual property or
propriety registrations or applications) resulting therefrom. Furthermore,
Consultant hereby forever waives and agrees never to assert any moral rights
it
may have in all or any part of an Invention, even after the termination of
the
Consulting Relationship. To perfect and effectuate the covenants contained
in
this Section, Consultant hereby further agrees to: (i) promptly and fully inform
the Company in writing of all Inventions; (ii) promptly execute and deliver
assignment or conveyance documentation to the Company evidencing that all of
Consultant’s rights to all Inventions are the sole and exclusive property of the
Company; and (iii) promptly acknowledge and deliver to the Company, without
charge to the Company but at the Company’s expense, such written instruments and
do such other acts as may be necessary, in the reasonable opinion of the
Company, to obtain and maintain patents and/or copyright registrations and
to
vest the entire rights, interest in and title thereto in the
Company.
(b)
Consultant
and the Company understand that the provisions of this Agreement requiring
assignment of Inventions to the Company will not apply to any Invention that
meets all four of the following criteria: (i) Consultant develops such Invention
entirely on his, her or its own time; (ii) Consultant develops such Invention
without using Company equipment, supplies, facilities or Confidential
Information; and (iii) does not result from any work performed by Consultant
for
the Company; and (iv) does not, at the time of conception or reduction to
practice, directly relate to the Company’s business as conducted prior to or
during the Consulting Relationship or known by Consultant to be anticipated
to
be conducted in the future. Any such Invention will be owned entirely by
Consultant, even if developed by Consultant during the term of this Agreement
or
otherwise during the Consulting Relationship. Finally, Consultant agrees and
covenants that Consultant will not individually file any patent applications
relating to Inventions without first obtaining an express release from a duly
authorized Company representative.
(c)
For
all
purposes of this Agreement, the term “Inventions”
means
all discoveries, improvements, inventions, ideas and works of authorship,
whether patentable or copyrightable or able to be trademarked, including all
associated rights thereto under any copyright, trademark and/or patent
applications, registrations, continuations in part, extensions, and granted
applications extending patent, copyright or trademark protections, regardless
of
whether conceived or made by Consultant solely or jointly with others, and
relating to any consultation, work or services performed by Consultant with,
for
on behalf of or in conjunction with the Company or based on or derived from
Confidential Information.
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6.
Non-Solicitation.
(a)
During
the Restricted Period (as defined below), Consultant agrees that he will not,
without the prior written consent of the Company, directly or indirectly (a)
induce, solicit, endeavor to entice or attempt to induce any customer, supplier,
licensee, licensor or other business relation of the Company to cease doing
business with the Company, or in any way interfere with the relationship between
any such customer, vendor, licensee, licensor or other business relation and
the
Company, or (b) induce, solicit or endeavor to entice or attempt to induce
any
employee of the Company to leave the employ of the Company, or to work for,
render services or provide advice to or supply Confidential Information to
any
third person or entity, or to in any way interfere adversely with the
relationship between any such employee and the Company.
(b)
For
all
purposes of this Agreement, the term “Restricted
Period”
means
the term of this Agreement and a one-year period after the expiration or
termination of this Agreement, and shall include an extension to such restricted
period equal to the length of time during which any covenant under this Section
is violated.
7.
Representations
and Warranties.
Company
and Consultant hereby represent and warrant to each other that their respective
execution, delivery and performance of this Agreement will not (a) violate
or breach Company’s or Consultant’s articles of incorporation or corporate
bylaws, as applicable, (b) result in a breach of any of the terms or
conditions of, or constitute a default under, any mortgage, note, bond,
indenture, agreement, license or other instrument or obligation to which Company
or Consultant is now a party or by which any of them or any of their respective
properties or assets may be bound or affected, or (c) violate any order,
writ, injunction or decree of any court, administrative agency or governmental
body in any respect, the violation or breach of which would prevent the Company
or Consultant from consummating the transactions contemplated herein. Moreover,
the parties hereby represent and warrant that no consents of any third parties
or governmental authorities are required for Company and Consultant to enter
into this Agreement.
8.
Arbitration.
(a) The
parties will resolve any disputes relating to the Agreement through amicable
negotiations. Failing an amicable settlement, any controversy, claim or dispute
arising under or relating to this Agreement, including the existence, validity,
interpretation, performance, termination or breach of this Agreement, will
finally be settled by binding arbitration before a single arbitrator (the
“Arbitration
Tribunal”)
which
will be jointly appointed by the parties. The Arbitration Tribunal shall
self-administer the arbitration proceedings utilizing the Commercial Rules
of
the American Arbitration Association (“AAA”);
provided,
however,
the AAA
shall not be involved in administration of the arbitration. The arbitrator
must
be a retired judge of a state or federal court of the United States or a
licensed lawyer with at least ten years of corporate or commercial law
experience.
(b) The
arbitration will be held in Denver, Colorado. Each party will have discovery
rights as provided by the Federal Rules of Civil Procedure within the limits
imposed by the arbitrator; provided,
however,
that
all such discovery will be commenced and concluded within 60 days of the
selection of the arbitrator. It is the intent of the parties that any
arbitration will be concluded as quickly as reasonably practicable. The
arbitrator will use all reasonable efforts to issue the final written report
containing award or awards within a period of five business days after closure
of the proceedings. Failure of the arbitrator to meet such time limits will
not
be a basis for challenging the award. The Arbitration Tribunal will not have
the
authority to award punitive damages to either party. Each party will bear its
own expenses, but the parties will share equally the expenses of the Arbitration
Tribunal. The Arbitration Tribunal may award attorneys’ fees and other related
costs payable by the losing party to the successful party as it deems equitable.
This Agreement will be enforceable, and any arbitration award will be final
and
non-appealable, and judgment thereon may be entered in any court of competent
jurisdiction. Notwithstanding the foregoing, claims for injunctive relief may
be
brought in a state or federal court in Minneapolis, Minnesota.
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9.
Indemnification.
Each
party agrees to indemnify and hold harmless the other party from and against
all
claims, demands, suits, losses, damages, costs, and expenses (including without
limitation attorney’s fees) arising out of or relating to any breach
(intentional or otherwise) by such party of any representations, warranties,
agreements, covenants, obligations or other terms or conditions of this
Agreement.
10.
Injunctive
Relief.
The
Consultant acknowledges and agrees that it would be difficult to fully
compensate the Company for damages resulting from the breach or threatened
breach of the covenants contained in Sections 4 through 6 of this Agreement,
and
that any such breach would cause the Company irreparable harm. Accordingly,
the
Company will be entitled to seek injunctive relief, including but not limited
to
temporary restraining orders, preliminary injunctions and permanent injunctions,
to enforce the terms hereof, without the need to demonstrate irreparable harm.
This right to injunctive relief will not, however, diminish any of the Company’s
other legal rights hereunder or at law.
11.
General
Provisions.
(a)
This
Agreement contains the entire understanding of the parties with regard to all
matters contained herein, and supersedes all prior agreements relating to the
matters contained herein. This Agreement may be amended only in a writing signed
by both parties.
(b)
This
Agreement shall be construed in accordance with the laws of the State of
Minnesota applicable to contracts made and to be performed within Minnesota,
without regard to its conflicts-of-law principles.
(c)
Any
termination of this Agreement will not release either party from any obligations
or liabilities that remain to be performed, or by their nature would be intended
to be applicable following any such termination, including but not limited
to
the covenants contained in Sections 4 though 6 hereof.
(d)
This
Agreement is and shall be binding upon the heirs, personal representatives,
legal representatives, successors and assigns of the parties hereto;
provided,
however,
that
Consultant may not assign its obligations or delegate its duties under this
Agreement.
(e)
If
any
provision of this Agreement shall be held by any court of competent jurisdiction
to be illegal, invalid or unenforceable, such provision shall be construed
and
enforced as if it had been more narrowly drawn (or limited in scope, including
geographic and/or temporal scope) so as not to be illegal, invalid or
unenforceable, and such illegality, invalidity or unenforceability shall in
no
event have any effect upon or impair the enforceability of any other provision
of this Agreement.
(f)
Any
notice to be given under this Agreement shall be in writing and shall be
effective (i.e., deemed given) upon personal delivery, upon the day after
sending by next-day courier to the address set forth in the introductory
paragraph of this Agreement, or upon the third day after mailing by registered
or certified mail, postage prepaid with return-receipt requested, addressed
to
the recipient party at the address set forth in the introductory paragraph
of
this Agreement. Each party may change its or his address by written notice
in
accordance with the previous sentence.
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(g)
This
Agreement may be executed in counterparts, each of which shall be deemed an
original, but all of which shall constitute one and the same agreement.
Signatures to this Agreement may be delivered by facsimile or other means of
electronic transmission, and signatures so delivered shall be fully valid and
binding expressions of intent to be bound to the same extent as the delivery
of
original signatures.
(h)
Other
than as expressly set forth herein, this Agreement is not intended to confer
upon any person other than the parties hereto any rights or remedies hereunder,
and no third party shall be entitled to rely on the provisions
hereof.
(i)
The
parties agree that this Agreement has been jointly drafted and negotiated by
the
parties and their respective attorneys and advisors and that no party may assert
an ambiguity in the construction of this Agreement against another party because
the other party allegedly drafted the allegedly ambiguous
provision.
(j)
The
headings of Sections hereunder are for convenience and reference only, and
shall
not be deemed a part of this Agreement or otherwise affect the interpretation
hereof.
(k)
No
consent under and no waiver of any provision of this Agreement on any one
occasion shall constitute a consent under or waiver of any other provision
on
such occasion or on any other occasion, nor shall it constitute a consent under
or waiver of the consented-to or waived provision on any other occasion. No
consent or waiver shall be enforceable unless it is in writing and signed by
the
party against whom such consent or waiver is sought to be enforced.
* * * * *
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In
Witness Whereof,
the
undersigned have caused this Agreement to be executed as of the date first
above
written.
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SPECTRE
GAMING, INC.:
|
CONSULTANT:
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|
By:
|
/s/
D. Xxxxxx
Xxxx
|
By:
|
/s/
Xxxxxxx X.
Mix
|
|
D.
Xxxxxx Xxxx, President
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Xxxxxxx
X. Mix
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