AGREEMENT Betex (Group) PLC and MAHJONG SYSTEMS LIMITED

Exhibit 4.3

 

AGREEMENT

Betex (Group) PLC

and

MAHJONG SYSTEMS LIMITED

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MEMORANDUM OF AGREEMENT

entered into between:

Betex (Group) PLC

A company duly incorporated under the laws of the United Kingdom

and

MAHJONG SYSTEMS LIMITED

A company domiciled in the Turks and Caicos Islands that offers a centralised Mahjong Gaming System and manages the settling of winnings and losses between participants.

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RECITALS

WHEREAS "Betex (Group) PLC" ("Betex") operates a gaming web site as part of their business;

AND WHEREAS "Mahjong Systems Limited" ("MSL") is a company established to operate a centralised gaming engine and settlement system for the benefit of the customers of its partners;

AND WHEREAS "Betex" wishes to integrate a multi player mahjong game into its existing gaming web site;

NOW THEREFORE the Parties agree to the following:

1. DEFINITIONS

Unless the contrary is clearly indicated, the following words and/or phrases, shall have the following meaning:

1.1	“this / the Agreement”	shall mean this written document together with all written appendices, annexures, exhibits or amendments attached to it from time to time by written agreement between the parties;
1.2	“Commencement Date”	shall mean the date on which the last of the duly authorized representatives of the Parties affixes their signatures to the Agreement;
1.3	“Confidential Information”	shall mean the personal information of the Introduced Players, including personal information and play history;
1.4	“Currency”	shall mean (not limited to) United States Dollars or EUROs;
1.5	"Rake"	shall mean the share, in the Currency, of the winnings paid in each game that is collected by “MSL” as a fee for its service;
1.6	"MSL"	shall mean a company with registered address Mahjong Systems Limited, Britannic House, Providenciales, Turks and Caicos Islands, B.W.I., herein represented by its duly authorized representative, ▇▇. ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇;
1.7	"Introduced Players"	shall mean players of the Mahjong Games, introduced by "Betex" as recorded by the mahjong system;
1.8	"Mahjong Games"	shall mean the multi player Mahjong game and any other games that "MSL" may make available from time to time;
1.9	“Parties”	shall mean "Betex" and "MSL" and “Party” shall be construed accordingly;

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1.10	“Partners”	shall mean all gaming systems that provide players and integrate with "MSL" in a manner similar to that contemplated in this agreement;
1.11	“Float”	shall mean the funds held as Deposit by "MSL" and adjusted in the monthly settlement;
1.12	“Float Amount”	The amount of Float that is agreed between "MSL" and "Betex", as adjusted from time to time, and held by "MSL" to cover possible losses by Introduced Players;
1.13	"Betex"	shall mean Betex (Group) PLC, a company duly incorporated under the laws of the United Kingdom, having its address for service under this Agreement at Suite 8.01, Exchange Tower, ▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇;
1.14	Any reference to the singular includes the plural and vice versa;
1.15	Any reference to natural persons includes legal persons and vice versa;
1.16	Any reference to a gender includes other genders;
1.17	The clause headings in this agreement have been inserted for convenience only and shall not be taken into account in its interpretation.

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2. DURATION

2.1 The Agreement shall commence on the Commencement Date.

2.2 The Agreement will continue in force for a period of three (3) years calculated from the Commencement Date and thereafter self-renew for further periods of three (3) years subject to either of the Parties’ right to terminate the Agreement, after the expiry of the initial three-(3)-year term, by giving one (1) month's written notice to expire no earlier than the end of the initial three (3) year term. In case of any such renewal, any cost increases (if any) shall be at the UK rate of inflation only.

3. RIGHT OF PARTICIPATION IN REVENUE SHARING

3.1 The Parties agree that other Partners may participate in revenue sharing with "MSL" in a similar manner to that contemplated in this Agreement.

4. RIGHT AND OBLIGATIONS OF MSL

"MSL" shall:

4.1 Have the right to use third parties to perform any of these rights and obligations;

4.2 Ensure that it is legally authorized to provide the Mahjong Games and owns and shall maintain in full force and effect throughout the term of this Agreement all licenses, authorizations and other permissions necessary for the provision of the Mahjong Games both at the Commencement Date and throughout the term of the Agreement;

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4.3 Ensure that all transactions in respect of its obligations in terms of this Agreement are conducted in the Currency as defined in the systems specifications;

4.4 Settle all net differences between Partners on a monthly basis within thirty (30) days of the end of each month by,

4.4.1 in the event that the Float is less than the Float Amount, instructing a Partner to remit funds to return the Float to the Float Amount;

4.4.2 in the event that the Float is greater than the Float Amount, paying the Partner the excess amount;

4.5 Pay the "Betex" commissions, as a percentage of the Rake, to "Betex" as defined in Schedule 1, these commissions settled in the same transactions as the settlement defined in clause 4.4;

4.6 Provide monthly report of Float movements and commissions due to "Betex" within 7 days of the end of a particular month and provide real-time access to financial and game information;

4.7 Hold the Float Amount in trust for "Betex" and in the event of termination of this Agreement return all amounts (including all outstanding payments due to “Betex” under this agreement) to "Betex" within 7 days of such termination;

4.8 Monitor the Float Amount and inform "Betex" as soon as reasonably practical if it is insufficient for the current play rate;

4.9 Maintain throughout the term of this Agreement and for 12 months thereafter keep full and proper books of accounts and records showing clearly all transactions relating to "MSL"'s obligations in respect of this Agreement;

4.10 Allow any person authorized by "Betex" to have access at all reasonable times to "MSL"'s premises for the purposes of inspecting the books and records (including all relevant electronic records) to the extent that this is necessary to ensure "Betex"’s interests are being protected as provided for in this Agreement;

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4.11 Provide software necessary to enable “Betex” and potential players to access the Mahjong Games within 30 days of the Commencement Date;

4.12 Use its best endeavors to ensure that the Mahjong Games are at all times available to potential and Introduced Players and that all information (Including Confidential Information) supplied by “MSL” as part of the Mahjong Games shall be up to date and error free;

4.13 Use its best endeavors to ensure that any planned outages of the Mahjong Games are notified to “Betex” at least 28 days in advance and that any such outages are scheduled so as to cause as little disruption as possible to “Betex”,

4.14 Use its best endeavors to ensure that any unplanned outages of the Mahjong Games shall be notified to “Betex” as soon as reasonably possible and in any event prior to the outage;

4.15 Provide all computer components, equipment and software needed to provide the electronic system to operate the Mahjong Games, including back office systems that may be accessed by “Betex” support staff to provide player support;

4.16 Provide systems and use best endeavors to prevent collusion, and update these systems on an ongoing basis where appropriate;

4.17 Provide support and service to “Betex” for technical and software issues, responding to problem notifications within two (2) hours of being advised of a problem and using its best endeavors to solve the problem within twelve (12) hours of receiving notification of a problem;

4.18 “MSL” acknowledges that it has no right to communicate with, nor ownership of, Introduced Players;

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4.19 Ensure that the Mahjong Games and all related content comply at all times with the licenses, authorizations and other permissions governing the provision of such games in its licensed server jurisdiction together with those of such other places as “MSL” may conduct its business from time to time throughout the term of this Agreement;

4.20 Ensure that the Mahjong Games and all related content shall not infringe any intellectual property rights of a third party nor does it violate any other third party rights;

4.21 Not do anything to bring (or which is likely to bring) “Betex” (Or its employees, director or employees) into disrepute;

4.22 Fully indemnify and keep fully indemnified “Betex” (and its employees, directors and agents) against any liability, damage, expense, claim or cost suffered by “Betex” (or its employee, director or agent) as a result of any breach by “MSL” of the undertakings given in clauses 4.19, 4.20 and 4.21 above.

5. RIGHTS AND OBLIGATIONS OF "BETEX"

"Betex" shall:

5.1 Promote the Mahjong Games and be responsible for all associated costs;

5.2 Not bring "MSL" into disrepute by marketing or selling the Mahjong Games in any fashion deemed to be illegal or undesirable;

5.3 Fully indemnify and keep fully indemnified “MSL” (and its employees, directors and agents) against any liability, damage, expense, claim or cost suffered by “MSL” (or its employee, director or agent) as a result of any breach by “Betex” of the undertaking given in clause 5.2 above;

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5.3 Use best endeavors to ensure that its activities do not violate the laws of any country to which the Mahjong Games are aimed;

5.4 Inform "MSL" as soon as possible of any legal difficulties that are encountered in respect of the promotion of the Mahjong Games;

5.5 Be responsible for all costs incurred by "Betex" in the software integration;

5.6 Be responsible for and bear all costs with relation to the player relationship including:

5.6.1 Acquiring funds into players’ accounts that may be subsequently used for the Mahjong Game,

5.6.2 Providing customer support to players,

5.6.3 Settlement of player withdrawals,

5.6.4 Managing and funding where necessary any shortfalls through charge backs or fraud,

5.6.5 Provision of all software and hardware systems associated with the player relationship;

5.7 Pay an initial and annual License Fee as per Schedule 1, the initial license fee being payable 50% on signing the contract and 50% on going live;

5.8 Deposit funds with "MSL" to establish the Float. The Float will cover the expected maximum deficit that would be realized in the course of one (1) month, such float to be adjusted where necessary during the course of the month in good time to avoid players being refused games. The initial float amount is set as per Schedule 1.

6. INTELLECTUAL PROPERTY RIGHTS

6.1 "Betex" shall acquire a non-exclusive, royalty-free, worldwide license from “MSL” for:

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6.1.1 itself and all Introduced Players to use the Mahjong Games throughout the term of this Agreement

6.1.2 itself to use all trade marks, service marks, logos and other distinctive brand features to make available the Mahjong Games and undertake promotion of the availability of the same on the “Betex” website.

6.2 “Betex” shall not acquire any right, title or interest in any copyright or other intellectual property rights in the Mahjong Games by virtue of this Agreement;

6.3 "MSL" shall not acquire any right, title or interest in any copyright or other intellectual property rights in "Betex"’s trademarks, trade names, copyrights and other rights used or embodied in or in connection with its activities.

7. VALIDITY

7.1 If any provision of this Agreement is found or held to be invalid or unenforceable, the validity and enforceability of all the other provisions of this Agreement will not be affected thereby.

8. CONFIDENTIALITY

8.1 "MSL" shall hold in confidence all Confidential Information received and not divulge the Confidential Information to any person, including any of its personnel, save for Parties directly involved with the execution of this Agreement;

8.2 "Betex" shall have full rights to and access to the Confidential Information.

8.3 The parties shall prevent disclosure of the Confidential Information, except as may be required by law.

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8.4 "MSL" shall ensure that each staff member or external party having access to Confidential Information is bound by individual non-disclosure agreements.

9. TERMINATION OF AGREEMENT

9.1 This Agreement may be terminated with immediate effect by "MSL" in the event of "Betex" not complying with the "MSL" requirements in terms of clause 5.2. This clause shall not be unreasonably invoked.

9.2 Each party may terminate this Agreement by written notice to the other Party in accordance with clause 2.2 after the initial period.

9.3 Either Party may terminate this Agreement by written notice if the other Party commits a breach of the Agreement:

9.3.1 which is material and unremediable; or

9.3.2 which is material and remediable but which remains unremedied at the end of a reasonable period of time (of not less than 30 days); this period of time, the breach and the reasonably required remedy having been previously specified by the non-breaching Party in written notice to the breaching Party, or;

9.3.3 which is a minor breach of a kind that has occurred several times before and following the non-breaching Party serving a notice to the breaching Party giving reasonable period (of not less than 30 days) within which to prevent a further occurrence; a breach of the kind specified in the notice occurs again.

9.4 Either Party may terminate this Agreement immediately and without notice if:

9.4.1 the other enters into a composition with its creditors;

9.4.2 an order is made for the winding up of the other;

9.4.3 an effective resolution is passed for the winding up of the other (other than for the purposes of amalgamation or reconstruction on terms approved by the first Party (such approval not to be unreasonably withheld)); or

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9.4.4 the other has a receiver, manager, administrative receiver or administrator appointed in respect of it.

9.5 Effect of Termination

The termination of the Agreement, for whatever reason, shall not affect the rights of either of the parties:

9.5.1 that may have accrued before the termination of the Agreement; or

9.5.2 which specifically or by their nature survive the termination of the Agreement.

9.6 On termination, "MSL" will provide, in an electronic format acceptable to "Betex", a copy of all the Confidential Information relating to "Betex".

9.7 "MSL" shall immediately destroy or return to “Betex” (at “Betex”’s option) all copies (including electronic copies) of Confidential Information in “MSL”’s possession, custody or control and in the case of destruction certify to "Betex" that it has done so.

10. DOMICILIUM

The Parties elect the following addresses as their respective domicilium citandi et executandi:

10.1 "Betex": Betex (Group) PLC: Suite 8.01, Exchange Tower ▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇

10.2 "MSL": Mahjong Systems Limited Britannic House Providenciales Turks and Caicos Islands B.W.I

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10.3 Either of the Parties may change its domicilium citandi et executandi to another address within the same country, by way of a notice to the other party to this Agreement, provided that such a notice is received by the addressee, at least 7 (seven) calendar days prior to such a change taking effect.

11. NOTICES

The Parties elect the following addresses at which all notices and other communications must be delivered for the purposes of this Agreement:

11.1 "Betex":

11.1.1 By hand at: Suite 8.01, Exchange Tower ▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Fax: ▇▇▇ (▇)▇▇ ▇▇▇▇ ▇▇▇▇

  For the attention of: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Chief Operating Officer;

11.2 "MSL":

11.1.2 By hand at: Brittanic House, Providenciales Turks and Caicos Islands, B.W.I. For the attention of: ▇▇. ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇

Fax:

11.2.2 With a copy to: Events International Holding Corporation ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇ For the attention of: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Fax: ▇▇ ▇▇▇-▇▇▇-▇▇▇▇

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11.3 Any notice or communication required or permitted to be given in terms of this Agreement shall only be valid and effective if it is in writing.

11.4 Any notice addressed to either of the Parties and contained in a correctly addressed envelope and sent by registered post to it at its chosen address or delivered by hand at its chosen address to a responsible person on any day of the week between 09h00 and 16h00, excluding Saturdays, Sundays and public holidays, shall be deemed to have been received, unless the contrary is proved, if sent by registered post, on the fourteenth calendar day after posting and, in the case of hand delivery, on the day of delivery.

11.5 Any notice sent by telefax to either of the Parties at its telefax number states overleaf (or such other telefax number as a Party may notify to the other Party from time to time) shall be deemed, unless the contrary is proved, to have been received:

11.5.1 if it is transmitted on any day of the week between 09h00 and 16h00, excluding Saturdays, Sundays and public holidays, within 2 (two) hours of transmission;

11.5.2 if it is transmitted outside of these times, within two hours of the commencement of the next day of the week between 09h00 and 16h00, excluding Saturdays, Sundays and public holidays, after it has been transmitted.

11.6 A Party shall not be entitled to rely on an email as a valid method of giving notice unless and until its receipt has been verified by a non-automated email response or by a reaction by the other Party in response to the email.

12. FORCE MAJEURE

12.1 Neither of the Parties shall be liable for a failure to perform any of its obligations insofar as it proves:

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12.1.1 that the failure was due to an impediment beyond its control;

12.1.2 that it could not reasonably be expected to have taken the impediment and its effects upon the party’s ability to perform into account at the time of the conclusion of this Agreement; and

12.1.3 that it could not reasonably have avoided or overcome the impediment or at least its effects.

12.2 An impediment, as aforesaid, may result from events such as the following, this enumeration not being exhaustive:

12.2.1 war, whether declared or not, civil war, civil violence, riots and revolutions, acts of sabotage;

12.2.2 natural disasters such as violent storms, cyclones, earthquakes, tidal waves, floods, destruction by lightning;

12.2.3 explosions, fires, destruction of machines, factories and any kind of installations;

12.2.4 boycotts, strikes and lockouts of all kinds, go-slows, occupation of factories and premises and work stoppages provided that any such action does not involve either Party’s workforce;

12.2.5 acts of authority, whether lawful or unlawful, apart from acts from which the party seeking relief has assumed the risk by virtue of any other provisions of this Agreement.

12.3 For the purposes of this clause “impediment” does not include lack of authorisations, of licences, of permits or of approvals necessary for the performance of this Agreement and to be issued by the appropriate public authority.

12.4 Relief from liability for non-performance by reason of the provisions of this clause shall commence on the date upon which the party seeking relief gives Notice of the impediment relied upon and shall terminate upon the date upon which such impediment ceases to exist; provided that if such impediment continues for a period of more than sixty (60) days either of the Parties shall be entitled to terminate this Agreement immediately upon written notice to the other Party.

13. ENTIRE AGREEMENT AND VARIATIONS

13.1 This Agreement including schedule 1 constitutes the whole agreement between the Parties and supersedes all prior verbal or written agreements or understandings or representations by or between the Parties regarding the subject matter of this Agreement. Except as expressly stated in writing in this Agreement, neither Party has relied upon any statement or representation made by he other Party in agreeing to enter into this Agreement. Nothing in the clause purports to exclude liability for statements or representations made fraudulently.

13.2 No variation of or addition to this Agreement will be of any force or effect unless reduced to writing and signed by or on behalf of the Parties.

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14. RELAXATION

No indulgence, leniency or extension of a right, which either of the Parties may have in terms of this Agreement, and which either party (“the grantor”) may grant or show to the other party, shall in any way prejudice the grantor, or preclude the grantor from exercising any of the rights that it has derived from this Agreement, or be construed as a waiver by the grantor of that right.

15. WAIVER

No waiver on the part of either party to this Agreement of any rights arising from a breach of any provision of this Agreement will constitute a waiver of rights in respect of any subsequent breach of the same or any other provision.

16. SEVERABILITY

In the event that any of the terms of this Agreement are found to be invalid, unlawful or unenforceable, such terms will be severable from the remaining terms, which will continue to be valid and enforceable.

17. DRAFTING COSTS

Each of the Parties shall bear its own cost incurred as a result of the negotiation, drafting and finalisation of this Agreement, which shall include, but not be limited to, all legal fees.

18. ASSIGNEMENT

Neither Party may assign, transfer or charge any rights or obligations under this Agreement without the other Party’s prior written consent (such consent not to be unreasonably withheld or delayed).

19. RIGHTS OF THIRD PARTIES

No term of this Agreement is intended to benefit any person or entity not a party to it.

20. GOVERNING LAW

The validity and interpretation of this Agreement will be governed by the laws of England and both Parties hereby submit to the exclusive jurisdiction of the English court.

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I, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, the undersigned, herewith confirm that my position within "Betex" is that of Chief Operating Officer and state that I am duly authorized to enter into this Agreement, which I herewith do, on this the ______________

by signing this Agreement, for and on behalf of "Betex".

Witnesses:

1
2		Signature on behalf of Betex (Group) PLC

I, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, the undersigned, herewith confirm that my position within the Mahjong Systems Limited is that of Director and state that I am duly authorized to enter into this Agreement, which I herewith do,

on this the ________________

by signing this Agreement, for and on behalf of the "MSL".

Witnesses:

1
2		Signature on behalf of Mahjong Systems Limited

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Schedule 1

Revenue Share, License Fees and Initial Float Amount
Initial Float Amount	US$ *
First Year License Fee	US$ *
Subsequent Annual License Fees	US$ *
Revenue Share (share of House Rake paid to “Betex”)	* for rake under US$ * in a month * for all rake in excess of US$ * in a month

* The confidential portion has been so omitted and filed separately with the Commission.