Exhibit 10.6
AGREEMENT
THIS AGREEMENT is made the Third day of February 2004, between Carnegie
Xxxxx & Company Inc. (hereinafter, CGKY") located at 0000 Xxxxxxx Xxxxxxxxx
Xxxx, Xxx Xxxxx, Xxxxxx 00000 and Lottery Network Services LTD., or its nominee,
(hereinafter, "LNS"), a corporation established in accordance with the laws of
The Republic of Ireland, also referred to as "Consultant".
WHEREAS, CGKY has Race Track and Off Track Betting operations and
opportunities in Brazil and has a number of agreements in place with various
Brazilian Turf Clubs to provide additional Off-Track Betting (OTBs)
establishments;
WHEREAS, CGKY desires to contract with LNS to provide consulting services
based on the concept of Racino within Brazil, which is defined as Race Tracks
and OTB's offering Video Lottery gaming and Slot machines within these
establishments. Both parties understand that Government Sanctioned Lottery
Entities oversee VLT programs; however the Government of Brazil may designate
another authority for that purpose.
WHEREAS, Consultant possesses extensive experience in the establishment,
operation and management of lotteries, gaming, Internet and Wireless/Phone based
gaming systems and CGKY would like to discuss and potentially pursue a variety
of new product development programs;
NOW THEREFORE, in consideration of the mutual promises, covenants and
agreements herein, CGKY and Consultant hereby agree as follows:
ARTICLE 1. DEFINITIONS
In this Agreement the following terms and expressions shall have the following
meanings:
REGULATIONS: Means all related and relevant acts, decrees, laws and regulations
in full force and effect.
AGREEMENT: Means this Agreement and all schedules hereto, as the same may be
amended, modified, or supplemented by the Parties.
CGKY FEE: Has the meaning set forth in Article 5.
GAMES: Means any plan, game, operation or arrangement whereby prizes in the form
of money or other property or benefit are awarded to persons who conform
to the rules of the Lottery or Wireless/Phone operations including
without limitation for placing and honoring xxxxxx, holders of tickets
(both tangible and wireless tickets), or chances acquired by prior
payment, credit and drawn
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by some predetermined process, or whereby the winners are determined by
the incidence of chance from amongst the holders of tickets (both
tangible and wireless tickets) such as Standard Lottery Games, Instant
Games, Video Lottery, Numbers, Fixed Odds Numbers games and Lotto Type
Lottery Games.
PARTIES: Means CGKY and Consultant collectively.
PERSON: Includes an individual, corporation, partnership, joint venture,
unincorporated organization, a government or any other legal entity.
ARTICLE 2. APPOINTMENT OF CONSULTANT
2.1 CGKY appoints Consultant as the authorized Consultant to Advise and
Assist CGKY in developing a Racino opportunity within Brazil in
accordance with this Agreement.
2.2 CGKY expects to develop additional products for sale within its Brazilian
outlets and other media gaming opportunities in Brazil and it agrees to
negotiate with good faith for the right to utilize products presented to
it from the Consultant.
ARTICLE 3. OBLIGATIONS OF CONSULTANT
3.1 Consultant shall, from time to time on a timely basis:
(A) Provide advice and guidance on the Racino opportunity within
Brazil;
(B) Provide consulting on how to seek and achieve government support
on the Racino Program;
(C) Prepare presentations and support documents on the success of the
Racino in North America and its impact on the Turf Industry, State
Lotteries and overall economic benefits;
(D) Make presentations in person to designated Brazilian authorities;
(E) Assist CGKY in designing business plans and business data in
support of CGKY's development of this business opportunity;
(F) Present to CGKY additional gaming opportunities for development
within Brazil.
3.2 In no event shall the obligations of Consultant exceed 400 hours
annually.
ARTICLE 4. OBLIGATIONS OF CGKY
4.1 CGKY agrees to:
(A) Provide introductions to local contacts that can assist in moving
the Racino project forward;
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(B) Notify and assist Consultant in complying with any changes in the
regulations regarding Racino, The Turf Industry, Lottery and other
gaming within Brazil;
(C) Pay all out of pocket costs for travel and expenses for delivery
of Consultant's expertise and support.
ARTICLE 5. CONSULTING FEES
5.1 CGKY will issue to LNS a total of 600,000 shares of common stock in CGKY,
which will be transferred to LNS in 4 installments of 150,000 shares
issued on signing of this agreement and 150,000 shares of common stock in
CGKY each of three (3) six (6) month periods thereafter. LNS will in the
aggregate receive 600,000 shares within eighteen (18) months of execution
of this Agreement. These shares will be legend stock, issued within the
next 30 days, with all shares becoming freely trading one year from being
issued. It is agreed between the parties that CGKY can cancel this
Agreement after one year has elapsed from the execution of this Agreement
if it abandons the Racino opportunity within Brazil. An additional
success fee of 1,000,000 shares of CGKY will be transferred to LNS if
Racino becomes a fully Government sanctioned opportunity that benefits
CGKY. In such event, this success fee is payable six (6) months after
CGKY begins earning revenues from this business opportunity.
ARTICLE 6. CONDITIONS
6.1 Consultant and CGKY acknowledge that the Parties hereto are independent
and that it is not intended by entering into this Agreement to constitute
either of them as the agent of the other or to form a partnership of any
nature whatsoever between them, nor is it intended that they should be
characterized as carrying on business in partnership. Neither Consultant
nor CGKY shall take actions whatsoever which might be reasonably expected
to cause any person to believe that Consultant and CGKY are agents for
each other or are carrying on business in partnership.
6.2 Consultant and CGKY acknowledge that Xxxx Xxxxxx will be the principal
provider of the consulting services under this Agreement and that these
services are provided on a part time basis determined by Xxxx Xxxxxx and
subject to the limitations specified in Article 3.2. CGKY recognizes that
Xxxx Xxxxxx has substantial responsibilities with and is employed by LNS.
ARTICLE 7. TERM AND TERMINATION
7.1 Subject to prior termination in accordance with articles 7.2 or 7.3 this
Agreement will have an initial term commencing on the 18th day of
February, 2004 and
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ending on the 17th day of February, 2006.
7.2 This Agreement may be terminated by either party upon the default in the
performance by the other Party of its obligations arising under the terms
of this Agreement. In such event, the Party desiring to terminate this
Agreement will provide written notice to the other party of its intent to
terminate and will set forth the reasons for termination. If the reasons
for termination are not resolved to the satisfaction of the notifying
Party within ninety (90) days of the date of such notice, this Agreement
will terminate effective as of one hundred twenty (120) day period from
the date the intent to terminate was given.
7.3 Either party may terminate this Agreement if other party is found to have
materially affected the integrity of the Racino program through its
actions and activities, which for whatever reason have brought discredit
or harm to the reputation of CGKY and or the Consultant.
7.4 Termination of this Agreement for any reasons whatsoever shall not affect
any rights, duties and liabilities which arose to or accrued prior to the
effective day of the termination.
7.5 Notwithstanding the expiration or termination of this Agreement for any
reason whatsoever, the provisions of the Articles 5.1 and 8, shall
survive and remain enforceable in accordance with their terms without
time limit.
ARTICLE 8. CONFIDENTIALITY
8.1 CGKY acknowledges that during the Term of this Agreement neither CGKY and
its officers, directors, employees and agents may acquire or receive
confidential information from Consultant, including without limitation,
information concerning Games, methods, techniques, processes, trade
secrets and information, as well as information concerning the market for
Consultant's products and services and the marketing, merchandising and
selling strategies of Consultant (collectively, the Confidential
Information), all of which is hereby acknowledged by the CGKY to be
confidential and proprietary property of Consultant. This information
only pertains to the new product development aspect of this Agreement.
8.2 None of the officers or employees of Consultant or CGKY shall communicate
or otherwise disclose the contents of this Agreement or any provision
hereof to any person except with the prior written consent of the
parties, or as strictly required to perform its obligations hereunder or
as required under obligation imposed by applicable law.
8.3 Each party to this Agreement acknowledges the competitive value and
confidential nature of the Confidential Information and that use of such
Confidential Information by CGKY or disclosure thereof to any third party
could
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be competitively harmful to the Disclosing Party. In the event CGKY or
any party to which it transmits the Confidential Information pursuant to
this Agreement becomes legally compelled to disclose any of the
Confidential Information, CGKY shall provide the Disclosing Party with
prompt notice so that the Disclosing Party may seek a protective order or
other appropriate remedy. In the event that such protective order or
other remedy is not obtained, CGKY shall furnish only that portion of the
Confidential Information which it is advised by written opinion of
counsel is legally required, and CGKY shall exercise reasonable efforts
to obtain reliable assurance that confidential treatment will be accorded
the Confidential Information.
8.4 Each party to this Agreement acknowledges and agrees that, given the
nature of the Confidential Information and the competitive damage that
would result if the Confidential Information is used by CGKY other than
as is provided for herein or disclosed to any third party, money damages
would not be a sufficient remedy for any breach of this Agreement, and
that, in addition to all other remedies, the aggrieved party shall be
entitled to specific performance and injunctive or other equitable relief
as a remedy for any such breach. The parties further agree to waive any
requirement for the securing or posting of any bond in connection with
such remedy.
ARTICLE 9. FORCE MAJEURE
9.1 Performance of either Party affected by an Event of Force Majeure will be
suspended for as long as such Event of Force Majeure continues but the
Parties will use their best efforts to find alternative means of
accomplishing performance. Immediately upon the cessation of the Event of
Force Majeure, the Party affected by such Event of Force Majeure will
continue the performance that was suspended. Event of Force Majeure means
any: (a) act of God, fire, flood, earthquake, hurricane, explosion,
epidemic, or quarantine, (b) act of war, blockade, martial law, sabotage,
insurrection, or national emergency, (c) lockout, or other labor dispute,
governmental or judicial law, regulation, order, decree, instructions, or
the failure by the Government or any other government subdivision to act;
(d) a disruption in the capital markets or unreconcilable inflation; (e)
any other event, cost or circumstance, whether similar or dissimilar to
the foregoing beyond the reasonable control of the Parties and making
performance impossible.
ARTICLE 10. GENERAL PROVISIONS
10.1 This Agreement shall be governed by and construed in accordance with the
Laws of Nevada, United States, excluding its conflicts of laws
provisions.
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10.2 NOTICES
To Consultant:
Attention: Xxxx Xxxxxx
Lottery Network Services Ltd
0000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxxxx, Xxxxxxxx 00000
Phone 000 000 0000, FAX 000 000 0000
With a copy to:
Xxxxxx X. Xxxxxx, Esquire
Xxxxxx & Xxxxx, PLLC
000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxxxx, Xxxxxxxx 00000
Phone 000 000 0000, FAX 000 000 0000
To CGKY:
Attention: Xxx Xxxxxxxx
Carnegie Xxxxx & Company Inc.
0000 Xxxxxxx Xxxxxxxxx Xxxx
Xxx Xxxxx, XX 00000
Phone 0 000 000 0000, FAX 000 000 0000
10.3 All notices shall be deemed to be received and effective: (a) upon the
date of delivery, if delivered personally, by facsimile transmission, or
by express mail or air courier or (b) in the case of telex or cable upon
the date of receipt of confirmation by answer back, in each case to be
appropriate addresses or numbers set forth above. Any Party may change
its address for the purpose of this clause by written notice to the
other.
10.4 This Agreement constitutes the entire agreement between the Parties
pertaining to the subject matter hereof and supersedes all prior
agreements, representations, statements, negotiations, discussions and
understandings, written or oral, between the Parties.
10.5 CGKY warrants to Consultant, that it (a) has full legal power and
authority to sign and execute this Agreement; and that (b) all necessary
governmental approvals have been procured to permit the execution,
delivery, and performance of this Agreement without limitation.
10.6 Each Party shall indemnify and save the other Party and their respective
officers, directors, shareholders, employees and Consultants harmless of
and from any liability obligation, cost, expense, damage, or loss
whatsoever arising out of any breach of any provision hereof by such
Party and all claims, demands, suits, causes of action, proceedings,
judgments, costs and expenses or other liabilities of
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any kind of whatsoever (including without limitation reasonable legal
fees and disbursements) in respect thereof.
10.7 This Agreement may be amended, modified or supplemented only by written
agreement signed by all Parties.
10.8 Any waiver of the requirements of any provision of this Agreement shall
be effective only if it is in writing and signed by the Party granting
the waiver, and only in the specific instance and for the specific
purpose for which it has been given. No failure on the part of any Party
to exercise, and no delay in exercising, any right under this Agreement
shall operate as a future waiver of such right.
10.9 Each Party warrants that the individuals executing this Agreement have
the full right, power and authority to do so.
10.10 If any provision of this Agreement is held by a court of competent
jurisdiction to be invalid, void or unenforceable, the remaining
provisions shall nevertheless continue in full force and effect without
being impaired or invalidated in any manner.
IN WITNESS WHEREOF the Parties have executed this Agreement as of the day and
year first above written.
ON BEHALF OF AND FOR:
CGKY
By:
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Its:
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ON BEHALF OF AND FOR:
CONSULTANT
By:
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Its:
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