LICENSE AGREEMENT
-----------------
This Agreement is made and entered into as of the 18th day of June, 2002
(the "Effective Date") by and between:
American Wagering, Inc., a company incorporated in the state of Nevada, United
States of America, and having its principal office at 000 Xxxxx Xxxxx, Xxx
Xxxxx, Xxxxxx, 00000 (hereinafter called "AWI")
AND
Computerized Bookmaking Systems, Inc., a company incorporated in the state of
Nevada, United States of America, and having its principal office at 000 Xxxxx
Xxxxx, Xxx Xxxxx, Xxxxxx, 00000 (hereinafter called "CBS")
AND
MEGASPORTS (ACT) PTY. LTD. (ABN 54 081 251 470), a company incorporated in the
Australian Capital Territory, and having its principal office at 00 Xxxxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxxxx Xxxxxxx Xxxxxxxxx (hereinafter called "Licensee").
WITNESSETH
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WHEREAS, AWI owns certain trademarks, tradenames, service marks, domain names
and other intellectual property.
WHEREAS, CBS has developed certain software and proprietary information for
their computerized race and sports book wagering system.
WHEREAS, CBS is a wholly owned subsidiary of AWI.
WHEREAS, Licensee desires to make use of the trademarks, tradenames, service
marks, domain names, software, proprietary information, and intellectual
property of AWI and CBS.
WHEREAS, AWI and CBS desire to license the use of such to Licensee.
WHEREAS, AWI and CBS shall collectively be known as "AWI" throughout the
remainder of this Agreement.
NOW, THEREFORE, in consideration of the covenants, representations and
warranties set forth herein and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, AWI and Licensee agree
as follows:
1. Definitions and Interpretations
---------------------------------
1.1. Certain terms used herein shall have the meaning ascribed to such terms
as set forth in Schedule 1.
1.2. All the defined terms as set forth in Schedule 1, if defined in the
singular or present tense, shall also retain such general meaning if used in the
plural or past tense, and if used in the plural or past tense, shall retain the
general meaning if used in the singular or present tense.
1.3. The term "AWI" as used in this Agreement shall include Computerized
Bookmaking Systems, Inc., a wholly owned subsidiary of American Wagering, Inc.
2. Grant of License
------------------
Subject to the terms and conditions of this Agreement, AWI hereby grants
Licensee a: (a) paid-up, royalty-free, non-assignable, non-transferable and
exclusive license to: (i) use the Domain Name for the provision of Services and
(ii) Use the Marks in the Territory for the promotion and marketing of the
Services provided through the Domain Name and (b) non-assignable,
non-transferable, non-exclusive license to execute the Licensed Products at the
Location (unless otherwise approved by AWI in writing) only in association with
the Services.
3. Licensee Covenants
-------------------
Licensee hereby covenants, represents and warrants as of the Effective Date
and throughout the Term, the following:
3.1. Licensee shall perform timely, regular and reasonably adequate backup
procedures with respect to the Licensed Products.
3.2. Licensee shall ensure a stable operational environment for the Licensed
Products, including, without limitation: (a) all climate, security and utility
(including, without limitation, electrical and ventilation) functions are
reasonable and appropriate for the relevant computer systems and (b) all
relevant computer systems are reasonably free from viruses,
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bugs, security breaches or any intrusion from internal or external sources.
4. Inspection
----------
4.1. Licensee shall have thirty (30) days following the Effective Date to
inspect and accept or reject the Licensed Products; provided, however, that any
rejection may only occur in the event of the existence of a Material Defect.
4.2. In the event of rejection pursuant to Section 4.1 and at the sole
discretion of AWI, AWI shall have thirty (30) days to cure any Material Defect.
5. Retained Rights
----------------
5.1. All licenses not expressly granted to Licensee pursuant to this
Agreement are reserved by AWI. Licensee shall not acquire any right, title or
interest in and to the Licensed Intellectual Property. Licensee shall not
contest the right, title or interest of AWI in and to the Licensed Intellectual
Property or the validity of the license granted by AWI to Licensee pursuant to
this Agreement. Licensee shall not at any time apply for any registration of
any Intellectual Property which would affect the right, title or interest of AWI
in and to the Licensed Intellectual Property nor shall Licensee file any
document with any Governmental Authority or take any action which would impact
any such right, title or interest in and to the Licensed Intellectual Property
or assist any other Person with such action or document.
5.2. Any goodwill associated with or identified by the Marks, or any other
AWI Intellectual Property shall inure directly and exclusively to the benefit
of, and is the property of AWI, and all use (whether authorized or unauthorized)
of any other indicia of source, xxxx, logo or slogan by Licensee in the course
of promoting or marketing the Marks shall likewise inure directly and
exclusively to the benefit and shall be the property of AWI.
5.3. Licensee acknowledges and accepts that certain aspects of the Marks
have been, may have been and will potentially be misappropriated by third
Persons. AWI provides neither any guarantee nor assurance that AWI will be able
to cause cessation of such misappropriation nor any assurance that such third
Persons may fail in an ability to claim superiority of rights with respect to
the subject Intellectual Property.
5.4. All right, title and interest in and to the Licensed Intellectual
Property, including, without limitation, the Intellectual Property in the
Licensed Products, exclusively vests in and shall always vest with AWI or its
respective designees (as applicable).
5.5. Licensee shall promptly notify AWI of any unauthorized use of AWI
Intellectual Property by third Persons that come to Licensee's attention. AWI
shall have the right, exercisable at AWI's sole discretion, to institute and
control all Claims against third Persons relating to AWI Intellectual Property.
5.6. Licensee shall Use the Marks without any accompanying words or symbols
of any nature (save as required by the provisions hereof) unless first approved
in writing by AWI.
5.7. To the extent Licensee is deemed an owner of any Intellectual Property
in and to the Licensed Intellectual Property or any other Intellectual Property
which AWI has Developed or otherwise has a bona fide claim of ownership (whether
arising from this Agreement or otherwise), Licensee hereby assigns any and all
such Intellectual Property to AWI and will execute and undertake all documents
and all actions necessary to effect the clarification of ownership of all such
Intellectual Property in and to AWI and to permit AWI to apply for registration
of such Intellectual Property and/or issuances of patents, as well as maintain
any registrations or issuances granted.
5.8. AWI retains the right to preclude Licensee's use of any portion of the
Licensed Products that is determined to infringe a third Person's Intellectual
Property or that is the subject of a prohibition of use by any Governmental
Authority (a "Prohibition Event"). If a Prohibition Event occurs and such
preclusion follows, then AWI shall have ninety (90) days to provide a
substitute, in AWI's reasonable discretion, to the affected Licensed Products
for Licensee's use consistent with the provisions of this Agreement.
6. AWI Warranties
---------------
AWI warrants against Material Defects in the Licensed Products for a period
of ninety (90) days following the Installation Period. In the event a Material
Defect is identified, AWI shall provide a good faith effort to resolve such
Material Defect within thirty (30) days after Licensee's written notice of a
Material Defect.
7. Equitable Relief
-----------------
Notwithstanding Section 8, Licensee acknowledges that any violation of
Sections 2, 5, 17, 18 or 21 by Licensee shall cause irreparable injury to AWI
and shall entitle AWI to extraordinary and equitable relief by a court outside
of any requirement for Arbitration, including but not limited to temporary
restraining orders and preliminary and permanent injunctions, without the
necessity of posting bond or security. The opinions, findings, determinations
and orders of any court with respect to permanent equitable relief granted
consistent with this Section 7 shall have binding effect upon any
2
Arbitration and shall otherwise have res judicata and collateral estoppel effect
upon any Arbitration; provided, however, that the Arbitration Panel shall give
any court opinion, finding, determination or order granting temporary or
preliminary equitable relief persuasive juridical authority.
8. Liquidated Damages
-------------------
Subject to Section 7 and without limiting or denying the availability of
any equitable relief pursuant to Section 7, AWI shall be entitled to liquidated
damages in the amount no less than one million dollars ($1,000,000) for any
violation of Sections 2, 5, 17, 18 or 21 by Licensee (the "Liquified
Violation"), and Licensee shall pay such amount immediately upon the request of
AWI in the event of any Liquified Violation. Licensee acknowledges that the
totality of AWI's Losses in the event of a Liquified Violation will be
difficult, if not impossible, to ascertain and that such liquidated damages
merely represent Licensee's and AWI's best estimate of AWI's Losses up to the
point that cessation of the Liquified Violation occurs either from Licensee's
voluntary act or as imposed by court in the use of the court's equitable powers
and provided that the estimate of such Losses is not an agreed value of the
Losses AWI will have suffered by Licensee's violation of this Agreement.
9. Arbitration
-----------
Subject to Section 7, all Claims between the Parties shall be resolved in
accordance with Arbitration provisions set forth in Schedule 2.
10. Disclaimer of all Warranties and Representations.
-----------------------------------------------------
EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, AWI DISCLAIMS ANY AND ALL
WARRANTIES, CONDITIONS OR REPRESENTATIONS, WHETHER OR NOT IMPLIED, ORAL OR
WRITTEN, WITH RESPECT TO THE LICENSED INTELLECTUAL PROPERTY OR ANY OF THE
TRANSACTIONS REASONABLY CONTEMPLATED BY THE PARTIES HERETO PURSUANT TO THIS
AGREEMENT INCLUDING, WITHOUT LIMITATION, ANY AND ALL IMPLIED WARRANTIES OR
CONDITIONS OF TITLE, NON-INFRINGEMENT, MERCHANTABILITY, FITNESS OR SUITABILITY
FOR ANY PURPOSE (WHETHER OR NOT AWI KNOWS, HAS REASON TO KNOW, HAS BEEN ADVISED
OR IS OTHERWISE, IN FACT, AWARE OF ANY SUCH PURPOSE), WHETHER ALLEGED TO ARISE
BY LAW, BY REASON OF CUSTOMER USAGE IN THE TRADE OR BY COURSE OF DEALING.
11. Remedy
------
AWI SHALL NOT BE HELD LIABLE TO LICENSEE ON ACCOUNT OF OR DUE TO BREACH OF
THIS AGREEMENT OR FOR ANY INDEMNIFICATION OBLIGATION (AS DEFINED IN SECTION 15)
IN OR FOR AN AMOUNT THAT EXCEEDS THE FEES PURSUANT TO THIS AGREEMENT RECEIVED BY
AWI FROM LICENSEE WITHIN THE PRIOR TWELVE (12) MONTHS OF TERMINATION OF THIS
AGREEMENT AND AWI SHALL NOT BE LIABLE TO LICENSEE (NOR TO ANY PERSON CLAIMING
ANY RIGHT, TITLE OR INTEREST DERIVED FROM OR AS SUCCESSOR TO LICENSEE'S RIGHT,
TITLE AND INTEREST) FOR INCIDENTAL, INDIRECT, CONSEQUENTIAL OR SPECIAL DAMAGES
OF ANY KIND INCLUDING, WITHOUT LIMITATION, LOST REVENUES OR PROFITS, LOSS OF
BUSINESS OR LOSS OF CONTENT ARISING OUT OF THIS AGREEMENT, IRRESPECTIVE OF
WHETHER THE PARTIES HAVE ADVANCE NOTICE OF THE POSSIBILITY OF SUCH DAMAGES.
12. Licensee Default Event. Licensee shall be in default of this Agreement
-----------------------
in the event of the occurrence of any of the following ("Licensee Default
Event"):
12.1. Licensee and/or Licensee's Representatives allow any other Person to
use the Licensed Intellectual Property in violation of this Agreement;
12.2. Licensee breaches any non-monetary provision of this Agreement not
related to the AWI Intellectual Property and fails to cure such breach within
thirty (30) days of the breach; or
12.3. Licensee breaches any provision related to the AWI Intellectual
Property and Licensee fails to cure such breach within three (3) days of such
breach.
13. AWI Default Event. AWI shall be in default of this Agreement in the
-------------------
event of the occurrence of any of the following ("AWI Default Event"):
13.1. AWI fails to cure a Material Defect within thirty (30) days pursuant
to Section 4.2. or Section 6;
13.2. A Prohibition Event occurs pursuant to Section 5.8, AWI exercises
AWI's right to preclude Licensee from using a portion of the Licensed Products
and AWI does not provide a substitute within ninety (90) days; or
13.3. AWI materially breaches any other provision of this Agreement and
fails to cure such breach within thirty (30) days of AWI receiving notice from
Licensee of such material breach.
14. Effect of Default; Termination
---------------------------------
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14.1. Upon the occurrence of a Licensee Default Event, AWI shall have the
right to any and all remedies available to AWI pursuant to this Agreement,
including, without limitation, the right to terminate this Agreement. On
termination of this Agreement, all Fees owed or accrued as of the date of
termination shall be immediately due and payable without set-off of any kind and
Licensee shall immediately return to AWI all of the Licensed Products in
Licensee's possession or control, together with a written statement signed by an
officer of Licensee to that effect; provided, however, AWI shall also have the
right to enter any and all locations where Licensee uses the Licensed
Intellectual Property to confirm Licensee's return of the Licensed Products.
14.2. Upon the occurrence of an AWI Default Event, Licensee shall have the
right to terminate this Agreement and, if such AWI Default Event occurred
pursuant to Section 13.1, AWI shall return any Fees paid by Licensee to AWI as
of the time of such AWI Default Event.
15. Indemnification
---------------
Notwithstanding any other provision of this Agreement, Licensee shall
indemnify and hold AWI and AWI's Representatives (the "AWI Indemnified Parties")
harmless from and against any Losses incurred by any of the AWI Indemnified
Parties with respect to, arising from or out of any Claim that relates to or
arises out of any act or omission of Licensee, including, without limitation,
the misuse of the Licensed Intellectual Property, alleged breach, or
investigation relating to a possible breach, of any legal requirement or of any
covenant, representation, warranty or other obligation of Licensee contained in
or arising out of this Agreement.
16. Assignment
----------
This Agreement, including, without limitation, the license granted pursuant
to Section 2, is personal to Licensee, and Licensee shall not assign or transfer
any of Licensee's rights or have assumed any of Licensee's obligations pursuant
to this Agreement to and by, respectively, third Persons, except where such
third Person: (a) Controls Licensee or (b) purchases all or substantially all of
Licensee's assets or voting securities.
17. Encumbrance
-----------
Licensee shall never Encumber, nor authorize nor enable any Person to
Encumber, the AWI Intellectual Property or any portion thereof.
18. AWI Confidentiality
--------------------
18.1. Licensee shall not Disclose to any Person (except for Authorized
Persons) any Confidential Information beginning at the Effective Date and for a
period of two (2) years after the termination of this Agreement. In perpetuity,
Licensee shall not Disclose to any Person AWI Trade Secrets.
18.2. Licensee shall not remove, alter, hide or otherwise diminish or
denigrate any notice of confidentiality, secrecy, privacy or indication of
proprietary right, title or interest (a "Notice") that is discernable on or with
respect to any Media embodying any Confidential Information, shall not separate
or disembody any Confidential Information from any Media embodying or containing
Confidential Information provided by AWI and/or AWI's Affiliate(s) to Licensee
and Licensee hereby covenants, represents and warrants that any Media bearing a
Notice shall not be necessary to create a presumption that certain Content is
Confidential Information
19. Licensee Confidentiality
-------------------------
AWI shall not disclose to any Person (except for Authorized Persons) any
confidential information owned by Licensee and designated by Licensee as
confidential information commencing on the Effective Date and continuing for a
period of two (2) years after the termination of this Agreement.
20. Notices
-------
Notices and other communications under this Agreement shall be sent to the
Parties at the address or fax number shown in herein or to such other address or
fax number as one Party may provide by notice to the other in writing. No
notice shall be effective until actually received, unless the intended recipient
fails to maintain, or fails to notify the other Party of any relevant change of
its name, address or fax number, in which case such notice shall be effective
when sent in accordance with this Section.
In the case of AWI:
President
American Wagering, Inc.
000 Xxxxx Xxxxx
Xxx Xxxxx, Xxxxxx 00000
Fax: 000-000-0000
With a copy to:
American Wagering, Inc.
c/o Xxxxxx X. Xxxxxx, Esq.
Santoro, Driggs, Walch, Kearney, Xxxxxxx & Xxxxxxxx
000 Xxxxx Xxxxxx Xxxxxx
Xxxxx Xxxxx
Xxx Xxxxx, XX 00000
Fax: 000-000-0000
In the case of Licensee:
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Euraust Limited
c/o: Xx. X. Xxxxxxx
Mezzanine Level, 00 Xxx Xxxxxxxxx
Xxxxx, Xxxxxxx Xxxxxxxxx
Fax: INT + (00 0) 0000 0000
21. General Provisions
-------------------
21.1. Licensee acknowledges that Licensee's failure to return all of the
Licensed Products in its possession or control upon termination of this
Agreement or any violation by it of its covenants in this Agreement relating to
Intellectual Property would result in damage that is largely intangible, but
nonetheless real, and that is incapable of complete remedy by an award of
damages. Accordingly, any such violation shall give AWI the right to a
court-ordered temporary restraining order and injunction (both preliminary and
permanent) without any requirement to post bond and/or other appropriate order
to specifically enforce those covenants.
21.2. The provisions herein concerning Intellectual Property will be
construed as independent of any other provision hereof and raising a defense to
an obligation of Licensee in this Agreement related to Intellectual Property
shall not impair the on-going duty of Licensee to perform in accordance with its
own obligations pursuant to this Agreement.
21.3. Licensee agrees that in utilizing the Licensed Intellectual Property,
Licensee will in no way represent that Licensee has any right, title or interest
in or to the Licensed Intellectual Property.
21.4. Licensee shall allow AWI to enter any and all locations where the
Licensed Intellectual Property are used at reasonable times to audit and inspect
Licensee's use of the Licensed Intellectual Property. AWI shall provide
Licensee twenty-four (24) hours notice of such audit or inspection. If such
audit or inspection results in a Licensee Default Event, Licensee shall be
responsible for any fees associated with such audit or inspection.
21.5. If any provision of this Agreement should be held to be void or
unenforceable, in whole or in part, by a court of competent jurisdiction, then
such court shall correct the defect in a narrowly tailored manner to approximate
the manifest intent of the Parties.
21.6. Sections 5, 10, 11, 15, 16, 17, 18, 19, 20 and 21 shall survive any
termination of this Agreement.
21.7. This Agreement represents the entire understanding between AWI and
Licensee with respect to the Licensed Intellectual Property. This Agreement may
be changed, waived, discharged or terminated only by an instrument in writing,
signed by the Party against which enforcement of such change, waiver, discharge
or termination is sought. This Agreement shall be binding upon and inure to the
benefit of the Parties and their respective successors and assigns and may be
executed in one (1) or more counterparts. The Parties acknowledge that each of
them has reviewed this Agreement and has had the opportunity to have it reviewed
by their attorneys and that any rule or construction to the effect that
ambiguities are to be resolved against the drafting party shall not apply in the
interpretation of this Agreement, including amendments or any exhibits. This
Agreement shall be governed by and construed in accordance with the laws of the
State of Nevada. Licensee consents to personal jurisdiction, as well as venue
for any Claim regarding or arising out of this Agreement in the appropriate
state or federal court located in Xxxxx County, Nevada.
IN WITNESS WHEREOF, each of the undersigned has duly executed this
Agreement and represent that he or she has the authority to legally bind his or
her respective entities.
AWI/CBS: LICENSEE:
American Wagering, Inc., MegaSports (ACT) Pty. Ltd.
Computerized Bookmaking Systems, Inc.
By: /s/ Xxxxxxx X. Xxxxxxxxx By: /s/ Xxxxx Xxxxxx
________________________________ ________________________________
Name: Xxxxxxx X. Xxxxxxxxx Name: Xxxxx Xxxxxx
Title: CFO/Secretary/Treasurer Title: Managing Director
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SCHEDULE 1
DEFINITIONS
"Authorized Persons" shall mean those directors, officers, strategic advisors,
attorneys and managers of Licensee or AWI who must gain knowledge of the
Confidential Information or confidential information, respectively, in order to
use the Licensed Intellectual Property.
"AWI Intellectual Property" shall mean the Intellectual Property owned, held,
used or licensed by AWI, including, without limitation, all Intellectual
Property in and to the Licensed Intellectual Property.
"AWI Trade Secrets" shall mean Trade Secrets owned, held, used or licensed by
AWI.
"Business Day" shall mean any day, Monday through Friday, excepting Saturday and
Sunday and also excepting any day on which federal chartered banks situated in
Xxxxx County, Nevada are generally not open for business.
"CBS Software" shall mean the executable code referred to by AWI as the CBS
Software enabling race and sports book wagering and accounting functions.
"Claim" shall mean any demand, complaint, request for redress, assertion of a
cause of action or other claim whatsoever.
"Confidential Information" shall mean all the Content relating to, used in or
arising out of AWI's business, finances or other operations and held by, owned,
licensed, or otherwise possessed by AWI (whether held by, owned, licensed,
possessed or otherwise existing in, on or about AWI's offices, residence(s) or
facilities and regardless of how such Content came into being, as well as
regardless of who created, generated or gathered the Content), including,
without limitation, all Content contained in, embodied in (in any Media
whatsoever) or relating to AWI's ideas, creations, works of authorship, works of
visual art, business documents, Contracts, licenses, business and non-business
relationships, correspondence, operations, manuals, performance manuals,
operating data, projections, bulletins, supplier and customer lists and data,
sales data, cost data, profit data, strategic planning data, financial planning
data, designs, logos, motifs, proposed trademarks or service marks, test
results, product or service literature, product or service concepts,
manufacturing or sales techniques, process data, specification data, know how,
show how, Software, data bases, research and development information and data;
provided, however, that "Confidential Information" shall not include information
or data "generally publicly known". The phrase in the previous sentence
"generally publicly known" shall not be deemed to include the Content set forth
in patents despite the fact that patents have been published by the federal
government, unless such embodiment has otherwise been the subject of a
publication for general public consumption (other than publication as a patent)
or if that embodiment is otherwise utilized generally by Persons in the United
States of America in the industry or market within which AWI competes. All
provisions protecting "Confidential Information" in this Agreement shall be
deemed to also protect "AWI Trade Secrets" as well, but references to "AWI Trade
Secrets" shall not be deemed to automatically refer to "Confidential
Information."
"Content" shall mean all material, information, documents, matter, text,
Software, data, graphics, computer-generated displays and interfaces, images,
photographs and works of whatsoever nature, including, without limitation, all
compilations of the foregoing and all results and/or derivations of the
expression of the foregoing.
"Contract" shall mean all agreements, contracts, understandings, undertakings,
obligations, and other documents or matters where there is or was an agreement
to be bound.
"Control" shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of any Person, or
the power to veto major policy decisions of any such Person, whether through the
ownership of voting securities, by contract, or otherwise.
"Develop" shall mean develop, conceive, discover, reduce to practice, create, or
otherwise arise out of a Person's efforts in any manner whatsoever and through
any means whether now known or hereafter developed.
"Domain Name" shall mean the URL xxx.xxxxxxxxxx.xxx.xx and/or any other URL
utilized by the Licensee in connection with their provision of Services.
"Encumber" shall mean to impose a security interest, pledge, hypothecation,
lien, mortgage, or any other encumbrance of whatsoever nature.
"Exhibit" shall mean an enumerated exhibit each of which shall be deemed
attached hereto and incorporated herein by way of the specific reference or
references made in this Agreement and any such exhibit shall not be required to
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be separately executed for such exhibit to form a valid, binding and enforceable
part of this Agreement.
"Fees" shall mean any and all fees to be paid by Licensee pursuant to this
Agreement.
"Governmental Authority" shall mean any federal, state, county, municipal or
other sovereign entity or jurisdiction, as well as all subdivisions, agencies
and authorities therein.
"Intellectual Property" shall mean all foreign, federal, state and common law
trademarks, service marks, domain names, Internet path names and addresses of
whatsoever nature, trade dress, copyrights, know-how, show-how, patents,
Inventions (whether or not patentable), mask works, Software, proprietary data,
customer lists, strategic plans, financial data, Trade Secrets, all other
intangible assets of whatsoever nature and all applications for registration
and/or issuance with respect to all the foregoing and whether or not any of the
foregoing is registerable or patentable, including, without limitation, with
respect to all of the foregoing: (i) all goodwill associated with any and all
of the foregoing; (ii) all parents, continuations, continuations in part,
divisionals, reissues and extensions; and (iii) all moral rights associated with
any and all of the foregoing.
"Interface" shall mean the graphical user interface of the Domain Name Developed
by AWI or any other Intellectual Property contained in, with respect to, or
arising therefrom.
"Inventions" shall mean any idea, invention, technique, modification, process,
or improvement (whether patentable or not), any industrial design (whether
registerable or not), and any work of authorship (whether or not copyright
protection may be obtained for it).
"Licensed Intellectual Property" shall mean the Intellectual Property in and to
the Licensed Products, the Domain Name and the Marks.
"Licensed Products" shall mean the CBS Software and the Interface.
"Licensee Business" shall mean the ordinary course of business as conducted by
Licensee as of the Effective Date.
"Licensee Default Event" shall mean any or all of the events as designated in
Section 12.
"Licensee Software" shall mean any Software that is Developed, licensed,
purchased or otherwise acquired by Licensee and will be used in conjunction with
the Licensed Products.
"Location" shall mean the location where the Licensed Products are initially
installed.
"Losses" shall mean any and all damages, liabilities, costs, expenses, fees
(including, without limitation, attorneys', accountants', investigators',
witnesses' and professionals' fees), charges, expenditures, liabilities, damages
and other losses of whatsoever nature.
"Marks" shall mean the marks MEGASPORTS, MEGASPORTS and Design (as set forth as
Exhibit 1) and XXXXXXXXXX.XXX.XX.
"Material Defect" shall mean a defect that negates the ability to effect the
essential functions of the Licensed Products; provided, however, that any defect
caused by, arising from, or emanating from anything outside the reasonable
control of AWI, including, without limitation, any modification or error on the
part of Licensee or any defect of any Licensee Software or relevant computer
systems, shall not constitute a "Material Defect."
"Media" shall mean print, document-based medium, television, facsimile, telex,
telephony, radio, satellite, cable, wire, computer-based network, network,
magnetic means, optical means, electronic means, Internet, intranet, Software,
compact and laser disc, digital video displays, video cassettes, and multi-media
and any other method (now known or hereafter Developed) for the publication,
retention, conveyance, possession or holding of Content.
"Person" shall mean any natural person, corporation, limited liability company,
limited partnership, partnership trust, association, organization or other
entity of whatsoever nature.
"Representatives" shall mean all shareholders, directors, officers, strategic
advisors, employees, agents, representatives, attorneys, and accountants either
holding equity in, retained by, employed by, commissioned by or otherwise
Controlled by a subject Person.
"Schedule" shall mean an enumerated schedule each of which shall be deemed
attached hereto and incorporated herein by way of the specific reference or
references made in this Agreement.
"Section" shall be deemed a reference to an enumerated provision of this
Agreement. Section headings are used for convenience only and shall have no
interpretive effect or impact whatsoever.
"Services" shall mean wagering services.
"Software" shall mean source code, object code, executable code, or other
program or code format whatsoever, whether now known or hereinafter developed.
"Taxes" shall mean sales, use, excise and other taxes, duties or imposts of
whatsoever nature, other than income taxes imposed by Governmental Authority.
"Term" shall mean the period beginning on the Effective Date and continuing in
perpetuity, unless earlier terminated pursuant to the provisions of this
Agreement.
"Territory" shall mean Australia and on websites specifically targeted to
Persons in Australia.
"Trade Secrets" shall mean all methodologies (subject to same being the subject
of an issued patent), pricing strategies, marketing approaches and other
Confidential Information that the AWI reasonably informs (whether orally or in
writing) the Licensee from time to time is a trade secret, as well as other
Confidential Information reasonably the subject of trade secret protection under
relevant and applicable state statutes (including, without limitation, the
Uniform Trade Secrets Act as enacted in Nevada.
"URL" shall mean uniform resource locator or universal resource locator.
"Use" shall mean the incorporation, embodiment and/or application in any Media
whatsoever.
"Working Hours" shall mean 9:00 a.m. to 5:00 p.m. Pacific Time, except for one
hour for lunch at 12:00 p.m. to 1:00 p.m.
Schedule 1a - Arbitration Definitions
"Arbitration" shall mean the entire dispute resolution process pursuant to the
provisions of Schedule 2 including without limitation, all the hearings,
discovery, conferences, and acts required by the Parties and the Arbitration
Panel in order to comply with Schedule 2 and carry out the dispute resolution
process as set forth in Schedule 2.
"Arbitration Claim" shall mean any Claim whatsoever relating to or arising out
of a violation, breach or other abrogation of this Agreement or for declaratory
relief.
"Arbitration Commencement Date" shall mean the date on which the Respondent
receives the notice of Arbitration.
"Arbitration Hearings" shall mean all hearings relating to the Arbitration,
including, without limitation, the Arbitration Initial Hearing and the
Arbitration Final Hearing.
"Arbitration Final Hearing" shall mean the final hearing as defined in Section 6
in Schedule 2.
"Arbitration Initial Hearing" shall mean the initial hearing as defined in
Section 6 in Schedule 2.
"Arbitration Panel" shall mean the three arbitrators as designated pursuant to
Section 5 of Schedule 2.
"Arbitration Panel Formation Date" shall mean the date that the third arbitrator
is designated and accepts such designation pursuant to Section 5 of Schedule 2.
"Claimant" shall mean the Party initiating the Arbitration.
"Counterclaim" shall mean any Claim associated with, related to or arising from
a breach, default, any other matter or any other controversy or dispute with
respect to the terms, subject matter or application of this Agreement and/or the
transactions arising therefrom or relating thereto asserted by a Party in
response to an Arbitration Claim.
"Decision" shall mean the final determination and ruling of the Arbitration
Panel with respect to any Arbitration Claim.
"Discovery Conference" shall mean the conference at which the Parties meet with
the Arbitration Panel for the purpose of exchanging discovery materials.
"Discovery Cut-Off Date" shall mean the fifteenth (15th) Business Day before the
Arbitration Final Hearing.
"Respondent" shall mean the Party against whom an Arbitration Claim is being
made.
Schedule 2-Arbitration Provisions
1. Certain terms used herein shall have the meaning ascribed to such terms
as set forth in Schedule 1 of the Agreement or as otherwise set forth in
Schedule 1a. References to Sections shall mean references to the enumerated
provisions of this Schedule 2 unless otherwise indicated.
2. Any Arbitration Claim shall be decided by Arbitration. A Decision shall
be final and binding on both Parties and shall bar any suit, action or
proceeding instituted by either of the Parties in any court or administrative
tribunal of any jurisdiction, except for a Decision on enforcement proceedings.
3. The Arbitration Panel shall have original and exclusive jurisdiction over
any Arbitration Claim. A Party must object to the jurisdiction of the
Arbitration Panel or to the arbitrability of a Arbitration Claim or Counterclaim
no later than the filing of a responsive statement to such Arbitration Claim or
Counterclaim, as provided in Section 2, and the only objection to jurisdiction
must be that the subject matter of the Arbitration Claim or Counterclaim does
not arise in relation to the subject matter of this Agreement. The Arbitration
Panel shall rule on such objections as a preliminary matter.
4. The Claimant shall give written notice (pursuant to and consistent with
the provisions of Section 17) of Arbitration to the Respondent. Arbitration
shall be deemed to commence on Arbitration Commencement Date. If the notice of
Arbitration is sent in conformance with Section 17, then no Arbitration Claim
shall be upheld as to improper or ineffective notice. The notice of Arbitration
shall contain a statement of Arbitration Claim including, without limitation,
the following:
4.1. A statement as to the nature of the Arbitration Claim that is
going to be referred to Arbitration and a clarification as to whether or not
other aspects of that Arbitration Claim shall be the subject of injunctive
relief through a court of competent jurisdiction;
4.2. The names and addresses of all interested Persons with respect to
the nature of the Arbitration Claim;
4.3. A description of the Arbitration Claim and an indication of the
facts supporting it;
4.4. The relief or remedy sought and the amount claimed; and
4.5. A request for a hearing location within the State of Hawaii.
5. Each Party shall designate one (1) arbitrator within fifteen (15)
Business Days of the Arbitration Commencement Date. These two arbitrators shall
cooperate in good faith to designate a third arbitrator within thirty (30)
Business Days after the Arbitration Commencement Date to serve as Chairperson
over the Arbitration, who will be solely responsible for all procedural
determinations of the Arbitration after consultation with the other members of
the Arbitration Panel. In the event that these two arbitrators cannot agree
upon a third arbitrator, each Party shall replace the Party's arbitrator with
one (1) replacement arbitrator and the two replacement arbitrators shall
cooperate in good faith to designate the third arbitrator within fifteen (15)
Business Days thereafter. In the event these replacement arbitrators cannot
agree upon a third arbitrator, the Party's shall each designate two (2)
prospective arbitrators and the Respondent shall randomly select the third
arbitrator from the pool of prospective arbitrators. Each arbitrator shall have
a Juris Doctorate Degree and any of the following: (a) at least five (5) years
of legal practice in an Intellectual Property group of a well-established law
firm practicing in the United States of America, or (b) shall have served for at
least five (5) years as a judge in the United States of America with substantial
experience in Intellectual Property matters. Each arbitrator shall also not
have an affiliation or relationship with either Party, nor shall they have any
interest in or benefit from the outcome of the Arbitration. The Arbitration
Panel's fees shall not commence or accrue until the Arbitration Panel Formation
Date.
6. The Arbitration Panel shall convene the initial hearing ("Arbitration
Initial Hearing") within ten (10) Business Days after the Arbitration Panel
Formation Date. The Arbitration Panel shall set the date and location in Hawaii
for the Arbitration Initial Hearing and for all hearings. The Arbitration Panel
and the Parties shall use their best efforts to resolve the Arbitration Claim at
the Arbitration Initial Hearing. In the event that a resolution of the
Arbitration Claim cannot be reached at the Arbitration Initial Hearing, the
Arbitration Panel shall set the Discovery Conference
within ten (10) Business Days after the date of the Arbitration Initial Hearing,
and the Arbitration Panel shall set the date and time of the Discovery
Conference. In the event that the Arbitration Claim is not resolved at the
Discovery Conference, then the Arbitration Panel shall convene the Arbitration
Final Hearing within ninety (90) Business Days from the Discovery Conference.
The Arbitration Panel shall send notice of the hearing to the Parties at least
thirty (30) Business Days in advance of the hearing date. At least fifteen (15)
Business Days before the final hearing ("Arbitration Final Hearing"), each Party
shall give the Arbitration Panel and the other Parties the names and addresses
of any witnesses it intends to present, and the subject of their testimony. The
Arbitration Panel shall apply the governing law of this Agreement.
7. At the Discovery Conference, the Parties shall:
7.1. Exchange all documents then reasonably available to the Parties at
the time of the Discovery Conference that the Parties contemplate to be used in
support of their Arbitration Claims, Counterclaims or defenses, including
rebuttal and impeachment documents;
7.2. Request in writing and with reasonable specificity all other
documents that may support the Party's Arbitration Claims, Counterclaims or
defenses from the opposing Party, subject to the limitation that such documents
must be relevant to the subject matter of the Arbitration, are not privileged,
and are admissible as evidence at the Arbitration Hearings or reasonably
calculated to lead to such admissible evidence;
7.3. Identify in writing, describe in writing or produce all tangible
things which constitute or contain matters that may support the Party's
Arbitration Claims, Counterclaims or defenses to the opposing Party and, upon
request, arrange for the opposing Party to inspect and copy, test or sample the
same;
7.4. Request in writing to inspect and copy, test or sample any
tangible things that may support the Party's Arbitration Claims, Counterclaims
or defenses from the opposing Party, subject to the limitation that such
tangible things must be relevant to the subject matter of the Arbitration, are
not privileged, and are admissible as evidence at the Arbitration Hearings or
reasonably calculated to lead to such admissible evidence;
7.5. Propose a plan for the taking of additional discovery, including a
plan for taking any depositions, prior to the Discovery Cut-Off Date;
7.6. Discuss settlement of the action; and
7.7. Discuss such other matters as may aid in the disposition of the
action.
8. Within five (5) Business Days of the Discovery Conference, the Parties
must file with the Arbitration Panel a joint report which includes the following
sections:
8.1. A brief description of the nature of the Arbitration and each
Arbitration Claim, Counterclaim and defense;
8.2. A written list of all documents to be exchanged at the Discovery
Conference pursuant to Section 7.1;
8.3. A copy of any requests served pursuant to Section 7.2 or 7.4;
8.4. A written list of all tangible things identified in writing,
described in writing or produced pursuant to Section 7.3;
8.5. A written list of persons (other than expert witnesses or
consultants) who are known or reasonably believed to have knowledge of any facts
relevant to any Arbitration Claim, Counterclaim or defense, including persons
having knowledge of rebuttal or impeachment evidence. Such lists shall identify
each person by name, last known address last known telephone number and by the
subject matter of the person's relevant knowledge.
9. If the Parties cannot agree on the on the filing of a joint report within
the time limit set herein, each Party shall file its own written report which
includes the sections identified in this Section 9 within five (5) Business Days
of the Discovery Conference.
10. The hearings shall be private. Witnesses, who are not a Party, shall be
required to recuse themselves from the hearings at all times, except for the
time period when they are testifying. The Parties and the Arbitration Panel
shall keep forever confidential all matters relating to the Arbitration and/or
the Decision.
11. Within fifteen (15) Business Days after receipt of a notice of
Arbitration, a Respondent shall submit a written statement of defense,
responding to the issues raised in the notice of arbitration, to the Claimant.
Any ancillary or pendent Arbitration Claim must arise out of the same nucleus of
operative facts and shall be made within fifteen (15) Business Days after the
Arbitration Commencement Date. At the time a Respondent submits its statement
of defense, a Respondent may make Counterclaims or assert set offs as to any
Arbitration Claim. The Claimant shall within fifteen (15) Business Days of
receipt of any Counterclaims submit a written statement of defense to the
Respondent. The Arbitration Panel may extend any of the time limits established
in this Section if such an extension is justified.
12. Within five (5) Business Days after the Arbitration Panel Formation
Date, or by such other time limit as may be set by the Arbitration Panel, the
Claimant shall submit to the Arbitration Panel three (3) copies of its notice of
Arbitration Claim, the Respondent's statement of defense and Counterclaims, and
the Claimant's statement of defense to any Counterclaim. Parties shall always
otherwise give prompt written notice of any pleadings, motions or Arbitration
Claims to the Arbitration Panel.
13. During the Arbitration, any Party may promptly and reasonably amend or
supplement its Arbitration Claim, Counterclaim or defense, subject to the
approval of the Arbitration Panel.
14. The Arbitration Panel shall conduct the Arbitration using their best
judgment while ensuring that each Party is heard and is given a fair opportunity
to present its case. It is the Arbitration Panel's discretion to determine the
manner of the Arbitration Final Hearing, including the method of witness
examination and evidence presentation, and the admissibility or exclusion of
evidence. The Arbitration Panel is further vested with authority to resolve all
discovery disputes.
15. If a Party fails to file a statement of defense within the time
established by this Section 15 or by the Arbitration Panel, a Decision will be
issued against them. If a Party, duly notified under these provisions, fails to
appear at a hearing without showing sufficient cause for such failure, as
determined by the Arbitration Panel, the Arbitration Panel shall enter a
Decision against them. If a Party, duly invited to produce evidence or take any
other steps in the proceedings, fails to do so within the time established by
the Arbitration Panel without showing sufficient cause for such failure, as
determined by the Arbitration Panel, the Arbitration Panel shall make a Decision
on the evidence before it.
16. The Arbitration Panel shall fix the periods of time for submitting any
written statements, research, memoranda, briefs, arguments of law, statements of
Arbitration Claims and Counterclaims, statements of defense, and for the
presentation of oral arguments, if required. The periods of time fixed by the
Arbitration Panel for the communication of such materials should not exceed
forty-five (45) Business Days unless the Arbitration Panel considers an
extension of time justified.
17. The Parties must serve any written notice of Arbitration Claim or
statement of defense (including, without limitation, any Counterclaim) to the
opposing Party by facsimile and by overnight delivery set forth in this Section
17. Such overnight delivery must be performed by Federal Express, UPS or DHL
delivery service. Where service in a manner not provided herein gives actual,
timely and sufficient notice to the appropriate Party, such service shall not be
deemed defective.
18. The Arbitration Panel has discretion to establish the parameters of
discovery in order to facilitate the broadest discovery of the truth. Discovery
shall take place within the time limits provided in this Agreement. All
discovery must be completed on or before Discovery Cut-Off Date. Discovery may
only be conducted after the Discovery Cut-Off Date upon a showing of good cause
why the discovery could not have otherwise been completed earlier and upon
approval by the Arbitration Panel.
19. The Parties hereby agree that discovery by oral testimony and testimony
at the Arbitration Final Hearing may be provided telephonically. At the request
of a Party, said testimony may be taken stenographically at the expense of the
requesting Party.
20. Any Arbitration shall be conducted in Hawaii at a location mutually
agreed to by the Parties or if they are unable to agree upon such location, then
at a location to be selected by the Arbitration Panel.
21. The Arbitration, discovery requests, or opinions associated with the
adjudication of any rights, liabilities, obligations, duties and other matters
with respect to this Agreement, arising out of this Agreement or relating to
this Agreement shall be in the English language.
22. Decisions shall be made in writing and communicated to the Parties by
the Arbitration Panel within thirty (30) Business Days of the Arbitration Final
Hearing. The Parties shall comply with the Decision without delay. The
Decision shall include a statement of the reasons upon which the Decision is
based. The Decision shall contain the date and the place where the Decision was
made.
23. The cost of the Arbitration, including, all attorneys fees, experts
fees, professionals fees, investigators fees, accountants fees, the Arbitration
Panel's fees, the costs of discovery, and the costs of the hearings shall be
borne by the losing Party or shall be apportioned as the Arbitration Panel shall
decide.
24. The Arbitration Panel shall grant the remedies and relief in sole and
absolute discretion; including, without limitation, where appropriate,
attorney's fees, punitive damages, and/or injunctive relief (if not granted
pursuant to this Agreement) and so long as it is in accordance with the
provisions of this Agreement. A monetary Decision shall be in United States
Dollars.
