AGREEMENT
made between
International Lottery in Liechtenstein Stiftung (InterLotto) represented by the
member of the Board having single signatory power ▇▇▇▇ ▇▇▇▇, attorney at law,
Vaduz
and
Electronic Fundraising Company Limited (EFO)
1.0 OVERVIEW
1.1 InterLotto is a charitable Foundation which is authorised and
controlled by the Liechtenstein Government. The Liechtenstein
Government has the right to give one year's notice to terminate the
authorisation on December 31, 2010. If the Liechtenstein Government
decides to authorise another Internet lottery after the year 2010,
InterLotto has an option to renew the licence on a first refusal basis.
The conditions under which a renewal takes place are not known at this
stage.
1.2 InterLotto has contracted with the Foundation of the International
Federation of Red Cross and Red Crescent Societies (FIFRC) to have the
InterLotto weekly international lottery redesigned and rebranded to
reflect that the benefits support the work of FIFRO (Appendix 1).
1.3 EFC has acquired the business of ▇▇▇▇▇▇ Consulting Limited with effect
from 1 September 1997, including its contract to provide software for
InterLotto (Dated 4 April 1997), its staff, premises and hardware.
1.4 EFC wishes to undertake extended Internet marketing of the InterLotto
lotteries using its own distribution system.
1.5 EFC is free, subject to the ongoing consent of the Red Cross and Red
Crescent Societies in the territory, to promote and market the
InterLotto lotteries in any manner that is legal and conforms to the
FIFRC InterLotto agreement.
1.6 EFC is free, subject to the agreement of InterLotto, to negotiate with
an alternative charity to replace the FIFRC in the event that the FIFRC
elects not to renew its agreement with InterLotto in 2002.
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2.0 INTERLOTTO RESPONSIBILITIES
2.1 InterLotto is providing lottery games on the Internet for the period of
its licence from the Liechtenstein Government.
2.2 InterLotto will establish procedures and specify the file format for
bulk data submission where required.
2.3 InterLotto undertakes to facilitate the development of new game
software in agreement with EFC.
2.4 InterLotto will credit EFC's portion of the revenue earned on the
specified lotteries to EFC's nominee. Payment will be made in the week
following the week of receipt, net of EFC's share of any credit card
charge backs from previous weeks.
2.5 The audited statement of gross receipts and EFC's commission for the
same period will be submitted to EFC within 3 months of the end of
InterLotto's financial year.
2.6 InterLotto will give EFC access to all banking and player transaction
data via on line transmission.
3.0 EFC RESPONSIBILITIES
3.1 EFC will establish and maintain a suitable structure to facilitate
software development, marketing and sales of InterLotto products.
3.2 EFC undertakes not to bring InterLotto or FIFRC into disrepute by
marketing or selling the InterLotto lotteries in any fashion deemed to
be illegal or undesirable. EFC will present the details of its
marketing strategy to InterLotto at regular intervals, but at least
four times per year, to enable InterLotto to ensure that the proposed
strategy will not bring InterLotto or FIFRO into disrepute and to
ensure that the said strategy complies with the terms of the FIFRC
contract. EFC will comply with the alterations to this strategy which
the FIFRC deems to be necessary.
3.3 The responsibility for all costs of promotion of the InterLotto
lotteries, including all costs of promotion on the Internet, lies with
EFC.
3.4 The responsibility for financing and installation of hardware for
extended Internet sales lies with EFC.
3.5 EFC undertakes to report to InterLotto every three months on legal
difficulties associated with the marketing and distribution of
InterLotto products in all areas of extended Internet marketing.
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4.0 COMMISSION EXCLUSIVITY
4.1 EFC will receive 10% of all entry fees made via the indirect access
technology and 10 % of all entry fees from direct Internet access,
except where existing players of InterLotto receive 5% for referrals,
in which case EFC's share will be reduced accordingly.
4.2 InterLotto undertakes not to pay any distribution commission to any
party other than EFC for the duration of this agreement, other than as
disclosed in terms of clause 4.1.
4.3 EFC, its operators, agents and franchisees may ▇▇▇▇ up the cost of
entries for InterLotto games, for their own benefit, by approximately
25%, subject to the on going agreement of InterLotto.
4.4 The price of the exclusivity referred to in 4.2 is one million five
hundred thousand pounds sterling, payable at the time that this
agreement is signed, in terms of Phase 1 of EFC's prospectus. A further
three million five hundred thousand pounds sterling is payable in
accordance with Phase 2 of the prospectus, which will be used by
InterLotto to provide adequate infrastructure to cater for higher
volumes of turnover on its Internet site.
5.0 TERMINATION
5.1 This agreement will extend until 31 December, 2010 or any longer period
for which the existing licence of InterLotto is extended by the
Liechtenstein Government.
5.2 This agreement may be terminated by InterLotto in the event of EFC not
complying with FIFRC requirements in terms of clause 3.2. This clause
shall not be unreasonably invoked.
5.3 In the event that EFC defaults on this contract, operators, agents and
franchisees may negotiate independently with InterLotto to continue
their respective operations.
6.0 TERRITORY
6.1 This agreement covers all countries of the world except Liechtenstein
and Switzerland.
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7.0 LAW
7.1 This agreement will be governed by Liechtenstein law whose courts will
be the courts of jurisdiction.
Sept. 25, 1997 25th Sept. 1997
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place/date place/date
The International Lottery in Electronic Fundraising Company Limited
Liechtenstein Foundation
/S/ ▇▇▇▇ ▇▇▇▇ /S/
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▇▇▇▇ ▇▇▇▇
AGREEMENT
made between
International Lottery in Liechtenstein Stiftung (InterLotto)
represented by the member of the Board
having single signatory power
▇▇▇▇ ▇▇▇▇, attorney at law, Vaduz
and
Electronic Fundraising Company Limited
1. The parties entered into an agreement dated 25 September 1997, a copy
of which is attached hereto and initialled by each of the parties for
the purposes of identification (the "Initial Agreement").
2. The parties have agreed to vary the terms of the Initial Agreement on
the terms and subject to the conditions of this agreement.
3. The Initial Agreement shall be varied by the deletion of Clause 4.4 and
the insertion of the following in its place:
4.4 The price of the exclusivity referred to in 4.2 is one million
five hundred thousand pounds sterling, payable at the time this
Agreement is signed, in the terms of Phase 1 of EFC's prospectus dated
7 July 1998.
4.5 A further three million five hundred thousand pounds sterling (the
"Commission") will be payable by EFC to ILLF at such time as EFC has,
in the reasonable opinion of the directors of EFC after consultation
with ILLF, sufficient working capital and cash flow to make the
payment. ILLE acknowledges that EFC does not have sufficient working
capital or cashflow at the date of this agreement.
4.6 The Commission will be used by ILLF to provide adequate
infrastructure to cater for higher volumes of turnover on its Internet
site.
4. Save as provided in this agreement the Initial Agreement shall remain
of full force and effect.
5. This agreement will be governed by Liechtenstein law whose courts will
be the courts of jurisdiction.
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19.11.1998 London 30.11.98
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place/date place/date
The lnternational Lottery Electronic Fundraising Company plc
in Liechtenstein Foundation
/S/ Hugo Sete /S/ ▇▇▇▇ ▇▇▇▇▇▇
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Hugo Sete ▇▇▇▇ ▇▇▇▇▇▇