Consulting Agreement - Youbet.com and Scott Schmidt
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT dated as of March 3, 2003 by and between Scott
Schmidt, an individual, whose principle residence is 1242 Berkley Street, Santa
Monica, CA 90404 (hereinafter referred to as Consultant), and Youbet.com, having
an office at 5901 De Soto Avenue, Woodland Hills, CA 91367 (the "Company").
The Company wishes to retain the services of the Consultant, and Consultant has
agreed to provide the services to the Company, pursuant to the terms hereof:
NOW, THEREFORE, in consideration of the mutual premises and covenants herein
contained, the parties hereto agree as follows:
1.0 ENGAGEMENT
Company hereby engages Consultant to provide the non-exclusive services pursuant
to the terms and conditions hereof. Consultant performs these services at the
direction of the Chief Marketing Officer.
The Company has selected the Consultant based upon the Consultant's personal
skills and the Consultant's agreement personally to perform the services
hereunder. The Consultant may not subcontract or otherwise delegate his
obligations under this Consulting Agreement without the Company's prior consent.
2.0 NATURE OF SERVICES
The Consultant is retained by the Company to perform Public Relations and
marketing services to enhance the Youbet.com name and brand.
3.0 TERM
The term of this Consulting agreement (the "Term") shall commence on March 3,
2003 and may be terminated by either Company or the Consultant upon thirty (30)
days written notice.
4.0 FEES
4.1 SERVICE FEE
Consultant shall receive a fee of $4,500.00 per month for services rendered
pursuant to this Consulting Agreement. The Consultant will devote not less than
16 hours per week to providing the services pursuant to this Consulting
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Agreement. Consultant will also be available to render services as and when
necessary outside of the 16 hours per week.
The Consultant will not be reimbursed for any expenses incurred in connection
with this Consulting Agreement, unless the Company approves those expenses in
advance in writing.
4.2 PAYMENT AND REPORTS.
Payments hereunder will be made as follows:
i. The Company shall pay the fee in two equal installments in
arrears within fourteen (14) days following receipt of the
Consultant's invoice for the period.
ii. The Consultant will maintain accurate records of all time
spent in performing services under this Consulting Agreement
and will provide the Company with a report of time and
services upon request.
4.3 TAXES.
The Consultant is solely responsible for payment of any and all taxes that may
be due upon the service fee, any other compensation and any income or gain
derived from the exercise of stock options granted hereunder.
5.0 OTHER BUSINESS ACTIVITIES AND CONFLICTS OF INTEREST
It is expressly understood by the Consultant and/or any of its affiliates that
it may not represent any third parties that do business in the gambling or
software industry that compete with, or potentially may compete with, the
Business of the Company, unless the Company, in its sole and absolute
discretion, consents in writing to such representation. The Consultant further
agrees that, notwithstanding the non-exclusive nature of this Consulting
Agreement, the Consultant will accept no other engagement of any type that will
interfere with his ability to render the services hereunder in a manner that is
both time and of quality satisfactory to the Company.
6.0 INDEPENDENT CONTRACTOR RELATIONSHIP
The parties hereto understand, acknowledge and agree that the Consultant's
relationship with the Company is that of an independent contractor and that
nothing in this Agreement is intended to or should be construed to create an
employment, partnership or joint venture relationship.
7.0 CONFIDENTIALITY
The Consultant during the Term and thereafter to take all steps reasonably
necessary to hold in trust and confidence information which he knows or has
reason to know is considered confidential by the Company ("Confidential
Information"). The Consultant agrees to use the Confidential Information solely
to perform this Consulting Agreement and covenants and agrees that he will not
use or disclose to any person without the Company's prior written approval, any
such Confidential Information learned or obtained by the Consultant during or
prior to the Term.
Confidential Information includes, but is not limited to, technical and business
information relating to the Company's inventions or products, research and
development, manufacturing and engineering processes, marketing effects, future
business plans and customer information. It also includes any third party's
proprietary or confidential information disclosed to the Consultant in the
course of providing services to the Company.
The Consultant shall take reasonable steps necessary to ensure that his
employees, agents, affiliates and contractors (if any) do not discuss, divulge
or utilize any confidential information communicated to or acquired by them.
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The obligations under this Paragraph 7.0 shall survive termination of this
Consulting Agreement.
8.0 TRADE SECRETS AND INTELLECTUAL PROPERTY RIGHTS
8.1 DISCLOSURE
The Consultant agrees to disclose promptly in writing to the Company, or any
person designated by the Company, copyrightable material that is conceived,
developed, made or reduced to practice by the Consultant in the performance of
services to the Company.
8.2 ASSIGNMENT OF WORK PRODUCT
"Work Product" means all work pertaining to public relations, marketing plans,
designs, discoveries, works of authorship, formulae, processes, inventions,
improvements and ideas solely or jointly conceived, developed or reduced to
practice during the performance of this Consulting Agreement. The Consultant
hereby irrevocably assigns, conveys and otherwise transfers to the Company, and
its respective successors and assigns, all rights, title and interests worldwide
in and to the Work Product and all proprietary rights therein, including,
without limitation, all copyrights, trademarks, trade secret rights, moral
rights, and all contract and licensing rights, and all claims and causes of
action of any kind with respect to any of the foregoing, whether now known or
hereafter to become known.
In the event the Consultant has any rights in and to the Work Product that
cannot be assigned to the Company, the Consultant hereby unconditionally and
irrevocably waives the enforcement of all such rights, and all claims and causes
of action of any kind with respect to any of the foregoing against the Company,
its distributors and customers, whether now known or hereafter to become known,
and agrees at the request and expense of the Company and its respective
successors and assigns to consent to and join in any action to enforce such
rights and to procure a waiver of such rights from the holder so such rights.
In the event the Consultant has any rights in and to the Work Product that
cannot be assigned to the Company and cannot be waived, the Consultant hereby
grants to the Company, and its respective successors and assigns, an exclusive,
worldwide royalty-free license during the terms of the rights to reproduce,
distribute, modify, publicly perform and publicly display, with the right to
sub-license and assign such rights in and to the Work Product including, without
limitation, the right to use in any way whatsoever the Work Product. The
Consultant retains no rights to use the Work Product and agrees not to challenge
the validity of the ownership by the Company in the Work Product.
The Consultant agrees to assist the Company in any reasonable manner to obtain
and enforce for Company's benefit, copyrights, and other property rights
covering the Work Product in any and all countries. The Consultant agrees to
execute, when requested, any copyright or similar applications and assignments
to the Company, and other lawful documents deemed necessary by the Company to
carry out the purpose of this Consulting Agreement.
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In the event the Company is unable for any reason whatsoever to secure the
Consultant's signature to any lawful and necessary document required to apply
for or execute any patent, copyright or other applications with respect to any
Work Product (including improvements, renewals, extensions, continuations,
divisions or continuations in part thereof), the Consultant hereby irrevocably
designates and appoints the Company and its duly authorized officers and agents
as his agents and attorneys-in-fact to act for and in his behalf and instead of
the Consultant, to execute and file any such application and to do all other
lawfully permitted acts to further the prosecution and issuance of patents,
copyrights, or other rights thereon with the same legal force and effect as if
executed by the Consultant.
The obligations and undertaking in this Section 8.0 shall survive termination of
this Consulting Agreement. If called upon to render assistance under this
section following termination of this Consulting Agreement, the Consultant will
be entitled to a fair and reasonable fee in addition to reimbursement of
authorized expenses incurred at the prior written request of the Company.
9.0 RETURN OF COMPANY PROPERTY
The Consultant acknowledges that the Company's sole and exclusive property
Includes all documents, such as drawings, manuals, notebooks, reports, sketches,
records, computer programs, employee lists, customer lists, and the like in his
custody or possession, whether delivered to the Consultant by the Company or
made by the Consultant in the performance of services under this Consulting
Agreement, relating to the business activities of the Company or its customers
or suppliers and containing any information or data whatsoever, whether or not
Confidential Information. The Consultant agrees to deliver promptly all of the
Company's property and all copies of the Company's property in the Consultant's
possession to the Company at the termination of this Consulting Agreement or at
any time upon the Company's request.
10.0 WARRANTIES AND INDEMNIFICATION
The Consultant represents and warrants that the Company's use, reproduction,
distribution or modification of the Work Product does not and will not violate
the rights of any third parties, including, but not limited to, trade secrets,
trademarks, publicity, privacy, copyrights and patents, or any applicable law
and regulation. The Consultant further represents that the Work Product is free
and clear of all encumbrances, including without limitation, security interests,
licenses, liens, charges or other restrictions.
The Consultant will, at his own expense, indemnify, defend and hold the Company
harmless against any claims (including the costs of litigation and attorneys'
fees) resulting from a breach or alleged breach of the Consultant's
representations and warranties under this Consulting Agreement. The Company
shall provide notice to the Consultant of any such claim, suit or proceeding and
shall assist the Consultant, at the Consultant's expense, in defending any such
claim, suit or proceeding.
11.0 TERMINATION
11.1 TERMINATION BY THE COMPANY
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The Company may terminate this Consulting Agreement immediately in the event of
material breach by the Consultant. "Material breach" shall include any violation
o the terms of Sections 7.0, 8.0, and 10.0, any other breach that the Consultant
has failed to cure within ten (10) days after written notice by the Company, and
any acts of gross misconduct by the Consultant directly affecting this
Consulting Agreement or the independent consultant relationship.
12.0 APPLICABLE LAW: ENFORCEMENT.
This Consulting Agreement shall be governed by and construed in accordance with
the laws in force in California (as applied to transactions entered into and to
be performed wholly within California between California residents) and the
parties hereby agree to submit to the courts located in the County of Los
Angeles, California.
The Consultant agrees that breach of sections 7.0, 8.0 and 10.0 of this
Consulting Agreement will cause the Company irreparable damage for which money
damages will be inadequate. The Company therefore will be entitled to obtain
timely injunctive relief to protect the Company's rights under this Consulting
Agreement in addition to any and all other remedies available at law. The
Consultant further acknowledges and agrees that this clause is not intended and
does not waive or estop the Company from seeking equitable or legal relief in
respect of any other breach, failure or for nonperformance of this Consulting
Agreement.
If any dispute between the parties with respect to or arising under this
Consulting Agreement leads to a proceeding to resolve such dispute, the
prevailing party shall be entitled to recover its reasonable attorneys' fees,
expert witness fees and out-of-pocket costs incurred in connection with such
proceeding, in addition to any other relief to which it is entitled.
13.0 ENTIRE AGREEMENT
This Consulting Agreement contains the entire understanding of the parties. This
Consulting Agreement may not be changed orally but only by an agreement in
writing signed by the party against whom enforcement of any waiver, change,
modification, amendment, extension or discharge is sought.
14.0 MISCELLANEOUS PROVISIONS
14.1 NOTICES
Notices related to this Consulting Agreement shall be sent to:
The Company: Michael Veitch
Chief Marketing Officer
Youbet.com, Inc.
5901 De Soto Avenue
Woodland Hills, CA 91367
The Consultant: Scott Schmidt
1242 Berkley Street
Santa Monica, CA 90404
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Any notice provided for or permitted under this Consulting Agreement shall be
given in writing and shall be delivered to the individuals and addresses above.
Delivery shall be effected by: (A) hand delivery; (B) confirmed telecopy; (C)
commercial overnight courier with written verification of receipt; (D) U.S. mail
postage prepaid, certified or registered mail, return receipt requested. Such
notice shall be deemed to have been received on the date of actual delivery or
three (3) days after sending, whichever is earlier.
14.2 WAIVERS
No provision of this Consulting Agreement shall be considered waived by either
party and no breach excused by either party, except in writing signed by the
party against whom waiver or excuse is asserted. No consent by either party to,
or waiver of, a breach by the other party, whether express or implied, shall
constitute consent to, waiver of, or excuse of any other, different or
subsequent breach by that party.
14.3 ASSIGNMENT
The Consultant may not assign its rights or obligations hereunder in whole or in
part without the Company's prior written consent. The Company may assign its
rights or obligations hereunder in whole or in part. This Consulting Agreement
will be for the benefit of the Company's successors and assigns, and will be
binging on the Consultant's heirs, legal representatives and permitted
assignees.
IN WITNESS WHEREOF, the parties have executed this agreement as of the date
first above written.
YOUBET.COM CONSULTANT
By: /S/ MICHAEL VEITCH By: /S/ SCOTT SCHMIDT
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Michael Veitch Scott Schmidt
Chief Marketing Officer Consultant
Date: Date: 3-19-03
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