Consulting Agreement - 649.com Inc. and Mindquake Software Inc.
CONSULTING AGREEMENT
THIS AGREEMENT, dated for reference the 1st day of June 1999 ( the "reference
date")
BETWEEN:
649.com, Inc. , a company incorporated in the Province of British Columbia and
having its principal place of business at 1320-925 West Georgia St.; Vancouver,
BC V6C 3L8
("'Company")
AND:
Mindquake Software Inc., a corporation organized under the laws of British
Columbia and having its principal place of business at 300 - 1168 Hamilton St.,
Vancouver, BC Canada V6B 2S2;
("Consultant")
WITNESSES THAT:
A. The Company is in the business of Internet Gaming
B. Consultant is in the business of providing strategic technology
consulting and software development services;
C. Company and Consultant wish to enter into an independent contractor
arrangement whereby Consultant shall perform certain services on the terms and
conditions set forth in this Agreement.
NOW THEREFORE in consideration of the mutual promises and covenants herein
contained, the parties hereby covenant and agree as follows:
General Terms and Conditions
----------------------------
Definitions
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1. Unless the context requires otherwise, the following terms shall
have the meanings set out below when used in this Agreement:
a) "Confidential Information" means trade secrets and other information not
generally known to the public, that Is owned by Company or Consultant, or by any
company affiliated, associated or related to Company or Consultant, or by any
of their respective suppliers, customers or other business partners.
Confidential information includes, without limitation, all Developments, source
code and related documentation. financial
information, legal, corporate, marketing, product, research, technical,
manufacturing, personnel, customer and supplier information and any other
information, in whatever form or media, specifically identified as confidential
by a party, or the nature of which is such that it would generally be considered
confidential in the industry in which that party operates, or which that party
is obligated to treat as confidential or proprietary;
b) "Consultant's Property" means the know-how, techniques, technologies,
methods, concepts, inventions and programs owned by Consultant prior to
commencing the Services and used by Consultant in performing the Services, that
are identified in a schedule to this Agreement:
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c) "Developments" means all inventions, improvements, discoveries, computer
software, and other results arising from or relating to the Services performed
by Consultant for Company (including, where applicable, all scripts, models,
specifications, source code, design documents, creations, artwork, text,
graphics, photos, pictures, and music); and
d) "Employees" means the one or more individuals who are employees(s) of, or
independent contractors engaged by, Consultant and who will actually perform the
Services.
Particulars of Services
-------------------------
2. General Obligations of the Parties Consultant shall perform the
Services described in Schedule
"1 ". Company shall pay Consultant for the Services in accordance with the terms
and conditions
set out in Agreement.
3. Term of Agreement - This Agreement shall be deemed to have come into
force and effect as of
the reference date set out on the face page and continues in affect until the
end of the Term identified in Schedule "1", unless one of the parties terminates
the Agreement in accordance
with its termination provisions.
4. Project Manager - Consultant's primary contact at Company shall be
the "Project Manager" identified in Schedule "1". The Project Manager shall
provide Consultant with general instructions and guidance with respect to the
performance of the Services.
Fees and Expenses
-------------------
5. Payment - As full and complete consideration for the performance of
the Services, Company shall pay Consultant the 'Fees' stipulated In Schedule "1"
plus all applicable taxes. Unless otherwise indicated in Schedule "1", Company
shall pay fees due Consultant within ten calendar days after receipt by Company
of an invoice for those fees. Consultant may charge late fees of 1.5 per month
or portion thereof for lets payment of any amount owing under this Agreement and
if any payment becomes more then 45 days overdue, may suspend performance of the
Services until such payment is made.
6. Invoices - If payment is due upon achievement of an identified
milestone, Consultant shall invoice
Company for the Services upon achievement of the milestone. In any other event,
unless otherwise indicated in Schedule "1", Consultant shall invoice Company for
the Services it performs on a monthly basis in arrears. Each invoice submitted
to Company by Consultant shall detail the nature of the Services performed, the
Fees payable, and the basis on which the calculation of the Fees has been made.
7. Expenses - Company shall reimburse Consultant for all reasonable
expenses incurred by the Employees as the result of Company requiring the
Employees to travel outside of Greater Vancouver, and for all other expenses
pre-approved by Company.
8. Reimbursement of Expenses - Consultant shall submit invoices for
expenses and shall attach the applicable receipts when these are reasonably
available. Company shall reimburse expenses within ten business days after
receipt by Company of the Invoices.
Independent Contractor Status
-------------------------------
9. Nature of Relationship - Consultant shall perform the Services as an
independent contractor, and nothing contained In this Agreement shall be
construed to create or imply a joint venture, partnership, principal-agent, or
employment relationship between the parties or between Company and the
<PAGE>
Employees. Unless Company specifically authorizes Consultant in writing to do
so, neither Consultant nor the Employees shall act or purport to be acting as
the legal agent of Company, end neither Consultant nor the Employee(s) shall
enter or purport to enter into any agreement on behalf of Company or otherwise
bind or purport to bind Company or cause Company to incur liability in any
manner whatsoever.
10. No Employment Payments or Benefits - Consultant hereby covenants to
pay, at Consultant's expense, all income taxes, unemployment Insurance premiums,
federal pension plan premiums, workers' compensation contributions, and all
other taxes, charges and contributions which competent government authorities
levy or require to be paid on behalf of Consultant or the Employees.
Consultant's Obligations
-------------------------
11. Representations and Warranties - Consultant represents and warrants
to, and covenants with Company that:
a) Consultant :hall observe and comply with all applicable laws, ordinances,
codes and regulations of governmental agencies, including federal, provincial,
state, municipal and local governing bodies, of any country having jurisdiction
over the Services or any part thereof; and
b) Consultant shall take all reasonable precautions to protect the integrity of
Company's computer systems and, where applicable, Company's customer's computer
systems, including without limitation, taking reasonable steps to ensure the
Employees comply with any Company policies in this regard of which Consultant Is
made aware of in a timely fashion.
Company's Obligations
----------------------
12. Indemnity - Company shall indemnify and save harmless Consultant
and its respective agents, independent contractors, directors, officers and
employees from and against any and all damages, losses, injuries, claims,
demands, actions, liabilities, costs and expenses (including reasonable legal
fees) incurred or made against Consultant arising, either directly or
indirectly, from any negligent or wrongful acts) or omissions of Company.
13. Access - Company shall provide to Consultant any assistance or
access to information and facilities reasonably required by Consultant to
perform Its obligations under this Agreement.
14. Care/Insurance for any Item of Consultant's Property on Company's
Site - Company acknowledges that during the term of this Agreement and
thereafter certain items of Consultant's Property may from time to time be left
at Company's site. Company agrees that it shell take reasonable care to protect
these items from lose or damage which shall not be less than the care,
protection, security measures, and shelter from adverse environmental
conditions, that Company provides for its own property. Company further agrees
that it shall obtain/maintain adequate insurance against the loss of
Consultant's Property and shall upon request, deliver evidence of such insurance
to Consultant for inspection.
15. Licenses for Third Party Software - If Consultant Indicates that
third party software is required to perform the Services and does not undertake,
In writing, to provide the identified software, then Company shall ensure it has
acquired the licenses or permissions, necessary to enable Consultant to utilize
this software in the performance of the Services.
<PAGE>
Termination of Agreement
--------------------------
16. Payment upon Termination - If either party terminates this
Agreement, Company shall pay Consultant for Services performed up to the
effective date of termination. If the Fees for Services under this Agreement are
based on Consultant achieving identified milestones. Company shall pay
Consultant up to and Including the last milestone achieved prior to the
effective date of termination. In addition, Company shall pay to Consultant the
hourly rate specified in Schedule "1" multiplied by the number of hours of
Services that, Consultant can demonstrate, were performed between the date that
milestone was achieved and the effective date of termination.
17. Return of Materials, Equipment and Confidential Information - Upon
termination or expiration of this Agreement, or at any time upon request by
either party (the "disclosing party"), the other party (the "receiving
party") shell immediately deliver up to the disclosing party, at disclosing
party's own expense and risk, all Confidential Information and all copies
thereof, and all other materials, documents, information, contracts,
equipment, materials and property, except items licensed to Company
hereunder, in the receiving party's possession, charge, control or custody
which it obtained from or which is owned by the disclosing party, its customers
or suppliers. Each party shall return any equipment, materials or property
furnished to it by the other party in the some condition as it was when
originally furnished, reasonable wear and tear excepted.
Confidentiality
---------------
18. Confidential Information - Each party acknowledges that in order to
enable Consultant to perform the Services properly, Company will disclose to
Consultant or allow Consultant access to, and Consultant will disclose to
Company or allow Company access to, Confidential Information. Each party further
acknowledges that this information has been acquired through the expenditure of
time, effort and money and that certain items of Consultant's Property contain
or embody Confidential Information.
19. Exclusion - The non-disclosure obligations under this Agreement
shall not apply to Confidential
Information which the receiving party can establish:
a) is, or becomes, readily available to the public other then through s breach
of this Agreement;
b) is disclosed, lawfully and not In breach of any contractual or other legal
obligation, to it by a third party; or
c) through written records, was known to it or developed by it, prior to the
date of first disclosure of the Confidential Information under this
Agreement.
20. Ownership of Confidential Information - Consultant and Company each
acknowledge and agree that they shall not acquire any right, title or
interest in or to the other party's Confidential information under this
Agreement.
21. Limited Disclosure, Use and Reproduction - During the term of this
Agreement and thereafter, each party shell maintain in strict confidence all
Confidential Information of the other party disclosed to it, or to which it
obtains access, as a result of this Agreement. Consultant and Company shall
not, and shall take all reasonable steps to ensure their respective employees do
not, directly or indirectly, disclose, allow access to, transmit or transfer the
other party's Confidential Information to a third party without the
disclosing party's consent, or use or reproduce such Confidential
information, in any manner, except as reasonably required to fulfil the
purposes of this Agreement. The receiving party shall ensure that every copy it
makes of the other party's Confidential Information is clearly marked, or
otherwise identified as confidential and proprietary to the other party, and is
stored in a secure location while in the receiving party's possession, control,
charge or custody. Notwithstanding the foregoing, If the receiving party can
establish it is required by law to disclose Confidential Information, it shall
be permitted, to the extent required, to do so, provided that notice of this
requirement to disclose is first delivered to the disclosing party, so that it
may contest this potential disclosure.
<PAGE>
Ownership and Licensing of Developments and Certain Items of Consultant's
--------------------------------------------------------------------------------
Property
--------
22. Ownership of Developments - Company shall be the exclusive owner of
the Developments and of all Intellectual property rights In and to such
Developments. Consultant hereby assigns to Company all right, title and
interest throughout the world and universe, Including without limitation,
all copyrights, trade-marks, trade secrets, patent rights, and any other
intellectual property right in and to each Development, effective at the
time each is created.
23. License for Consultant's Property - Consultant hereby grants to
Company, a perpetual non- exclusive, personal, non-transferable license to use
each item of Consultant's Property delivered to Company by Consultant under
this Agreement, solely for the purposes and to the extent set out in
Schedule " 1". It no specifics are included under the heading "Consultant's
Property" in Schedule "1", the licensed Consultant's Property may be used by
only one Individual at a time and solely for Company's own internal business
purposes.
24. Restrictions - Company shall not, without the prior written consent
of Consultant:
a) modify or in any way sitar the whole or any part of an Item of Consultant's
Property;
b) exceed the licensed use of Consultant's Property set out in this Agreement;
c) translate or reverse engineer the whole or any part of an Item of
Consultant's Property;
d) authorize or acquiesce in the use of Consultant's Property by a person other
than the Company or an employee of the Company;
e) remove any proprietary notices, labels or marks from Consultant's Property;
f) defeat any protection method used for preventing the unauthorized use of
Consultant's Property; or
g) copy any item of Consultant's Property, other than to make one archival copy
of any item of software included therein, to be stored In a locked, secure
location and executed only if the operating copy of that software becomes
unusable. For the purposes of this Agreement, copying means copying in any
manner, except copying that naturally results from the execution of software, or
from the regular back-up of the computer systems in which the software Is
installed.
25. If Company breaches any of the terms of the license granted for any
item of Consultant's Property, Consultant may terminate the license for ell
Items of Consultant's Property, by delivering written notice of its
intention to do so to Company. Upon termination of the license, Company
shall Immediately return to Consultant every item of Consultant's Property, in
its possession, custody or control.
26. Disclosure of Developments - Consultant agrees to make full and
prompt disclosure of all Developments to the Project Manager.
27. Further Acts - Consultant agrees to cooperate fully with Company
and to ensure the Employees cooperate fully with the Company, both during and
after the termination of this Agreement, with respect to signing further
documents and doing such acts and other things reasonably requested by Company
to confirm the transfer of ownership of the Developments, the waiver of moral
rights therein, and to obtain or enforce patent, copyright, trade secret or
other protection for Developments. Consultant shall not receive any
consideration or royalties in respect of such transfer of ownership, beyond the
Fees, provided that the expense of obtaining or enforcing the Intellectual
property protection shall be borne by Company."
<PAGE>
Limitation of Liability
-------------------------
28. THE PARTIES AGREE THAT THEIR RESPECTIVE RIGHTS AND OBLIGATIONS ARE
LIMITED TO THE EXPRESS UNDERTAKINGS MADE IN THIS AGREEMENT, AND THAT NO
TERMS, REPRESENTATIONS, CONDITIONS OR WARRANTIES, INCLUDING ANY WARRANTY OR
CONDITION OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE. PERFORMANCE,
OR DURABILITY, FOR ANY WORK PRODUCT RESULTING FROM THE PERFORMANCE OF THE
SERVICES, ANY ITEM OF CONSULTANT'S PROPERTY LICENSED HEREUNDER, OR FOR ANY THIRD
PARTY PRODUCT, WHETHER RECOMMENDED BY CONSULTANT OR NOT, SHALL BE IMPLIED
BETWEEN THEM.
29. WITH THE EXCEPTION OF THE INDEMNIFICATION SET OUT HEREIN, NEITHER
PARTY NOR THEIR RESPECTIVE AFFILIATES, DIRECTORS. OFFICERS OR EMPLOYEES
SHALL BE LIABLE TO THE OTHER PARTY FOR ANY ECONOMIC, COMMERCIAL, SPECIAL,
CONSEQUENTIAL, INCIDENTAL, EXEMPLARY OR INDIRECT DAMAGES, EVEN IF THEY HAVE
SEEN ADVISED OF THE POSSIBILITY OF SUCH LOSS, INCLUDING WITHOUT LIMITATION, LOSS
OF BUSINESS REVENUE OR EARNINGS, LOST DATA, LOST PROFITS, OR A FAILURE TO
REALIZE EXPECTED SAVINGS.
30. WITH THE EXCEPTION OF THE INDEMNIFICATION SET OUT HEREIN, NEITHER
PARTY'S LIABILITY TO THE OTHER PARTY IN CONNECTION WITH THIS AGREEMENT, NOR
THE LIABILITY OF THEIR RESPECTIVE AFFILIATES, DIRECTORS, OFFICERS OR
EMPLOYEES, SHALL EXCEED THE TOTAL AMOUNT PAID BY COMPANY TO CONSULTANT FOR THE
SERVICES ASSOCIATED WITH SUCH LIABILITY.
31. THESE LIMITATIONS, EXCLUSIONS AND DISCLAIMERS SHALL APPLY WHETHER
AN ACTION, CLAIM OR DEMAND ARISES PROM A BREACH OF WARRANTY OR CONDITION,
BREACH OF CONTRACT, NEGLIGENCE, STRICT LIABILITY OR ANY OTHER KIND OF CIVIL
LIABILITY CONNECTED WITH THIS AGREEMENT.
General
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32. Enforcement - Each party acknowledges end agrees that damages may
not be en adequate remedy to compensate for any breach of the other party's
intellectual property rights, and accordingly agree that in addition to any
and all other .remedies available, they shall each be entitled to obtain
relief by way of a temporary or permanent injunction to enforce such rights.
33. Maximum Protection Permitted/Severability - If any provision of
this Agreement is declare excessively broad, it shall be construed so as to
afford Consultant the maximum protection permissible by law. If any one or
more of the provisions of this Agreement shall for any reason be held to be
invalid, illegal, or unenforceable In any respect, any such provision shall,
unless Consultant elects otherwise, be severable from this Agreement, In
which event this Agreement shall be construed as if such provision had never
been contained herein.
34. Dispute Resolution/Mediation - The Project Manager, Key Contact and
signatories to this Agreement, and their successors or designates shall work in
good faith to resolve any disputes that arise under this Agreement. Where a
dispute arises out of or in connection with this Agreement that cannot be
resolved by these persons, and it Is not related to either party obtaining,
protecting or enforcing its intellectual property rights, the parties agree to
seek an amicable settlement of that dispute by mediation. If the parties
cannot agree on a mediator, the parties shall make application to court to
appoint one. The mediation shall be held in Vancouver, B.C. in accordance with
the British Columbia International Commercial Arbitration Centre's ("BCICAC")
"Procedures for Cases under the Commercial BCICAC Rules'. and the costs of
mediation shall be shared equally between the parties.
<PAGE>
35. Notice - Any notices, reports or other communications required or
permitted to be given under this Agreement shall be in writing and shall be
sufficient if delivered by hand or sent by double registered mail, courier or
facsimile addressed to Company or Consultant at their respective addresses
shown on the first page of this Agreement, to the attention of the Project
Manager in the case of Company, and to the attention of the Key Contact in
the case of Consultant, or to such other address or Individual as one party
advises the other party in writing. Any such notices, reports, or other
communications shall be deemed to have been received by the party(ies) to whom
they were addressed upon delivery by hand, double registered mail, courier or
facsimile (provided that the receiver acknowledges receipt of the facsimile In
some fashion) when received.
36. Survival - Any provision of this Agreement which, by its nature
would survive the termination or performance of this Agreement shall remain in
full force after the performance of this Agreement or its termination for any
reason.
37. Assignment - Neither party May assign this Agreement or any of Its
rights or obligations hereunder, without the other party's prior written consent
which shall not be unreasonably withhold or delayed.
38. Whole Agreement/Modification - This Agreement is comprised of this
document and the attached Schedules, In the event of any conflict or discrepancy
between this document and a Schedule, the terms of this document shall govern
unless the language in a Schedule indicates that it is the specific Intent
of the parties to overrule or to supplement a particular provision of 'this
document. This Agreement supersedes all previous dealings, understandings
and expectations of the parties and constitutes the whole agreement with respect
to the transactions contemplated hereby, and there are no representations,
warranties, conditions, or collateral agreements between the parties with
respect to such transactions except an expressly set out herein and In the
Instrument(s), if any, executed and delivered pursuant hereto. No amendment,
modification, supplement or other purported alteration of this Agreement
Mall be binding upon a party unless in writing signed by them or on their
behalf by a duly authorized representative(s).
39. Governing Law - This Agreement shall be governed by and interpreted
In accordance with the laws of British Columbia, excluding rules of private
International low that load to the application of the laws of any other
jurisdiction. The courts of British Columbia shall have the non-exclusive
jurisdiction to hear any matter arising in connection with this Agreement.
40. Counterparts - This Agreement may be executed in counterparts, or
facsimile counterparts, each of which when executed by either of the
parties shelf be deemed to be an original and such counterparts shall
together constitute one and the same Agreement.
The parties executed this Agreement on the date(s) set out below after having
the opportunity to discuss this Agreement with their legal advisors. Each party
represents and warrants that its respective signatory is duly authorized to
execute this Agreement an its behalf.
COMPANY: 649. com, Inc. CONSULTANT: Mindquake Software Inc.
By: /s/ Chris Wright By: /s/ Shawn Thomas
Name: Chris Wright Name: Shawn Thomas
Title: CEO Title: Senior Partner
Date: June 1st, 1999 Date: June 22/99
<PAGE>
SCHEDULE "1"
PARTICULARS OF CONSULTANT AGREEMENT
BETWEEN CONSULTANT AND COMPANY
1. Services
a) Feature Requirements Specification
b) Design Document Creation
c) Website development
d) Internet application development
Locations(s) where work to be performed: et Consultant's site; 300 -
1168Hamilton St., Vancouver, 8C Canada V88 282.
2. Term
Start Date: May 1st, 1999
End Date: When complete
3. Key Contact for Consultant
Jesse Dougherty
4. Project Manager for Company
Chris Cooper
5. Fees
a) Senior Partners: Consultant will charge Company - 160 per hour, plus GST.
b) Application Development: Consultant will charge Company $ 100 per hour, plus
GST.
c) Website (HTML) Authoring: Consultant will charge Company 075 per hour, plus
GST.
6. Consultant's GST No.
888611472RT
7. Equipment, Materials Supplied
Not applicable
8. Consultant's Property
Not applicable.
COMPANY: 649.com, Inc. CONSULTANT: Mindquake Software Inc.
By: /s/ Chris Wright By: /s/ Shawn Thomas