FORM OF
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT ("Agreement") is made and
entered into as of the day of , 1996, by and between
Colorado Gaming & Entertainment Co., a Delaware corporation,
formerly known as Hemmeter Enterprises, Inc. ("CG&E"), whose
address for purposes of notice hereunder is 1700 Lincoln, 49th
Floor, Denver, CO 80203, and Christopher B. Hemmeter
("Consultant"), whose address for purposes of notices hereunder
is .
WHEREAS, CG&E desires to engage Consultant to perform
certain consulting services on behalf of CG&E and Consultant
desires to be retained for such consulting services, on the terms
and conditions more particularly described below.
NOW, THEREFORE, in consideration of the mutual promises
and covenants herein described, the parties agree as follows:
1. Engagement. CG&E hereby engages Consultant as an
independent contractor to perform the Services more particularly
described below and Consultant hereby accepts such engagement
upon the terms and conditions hereinafter set forth.
2. Services. Consultant shall provide CG&E, and all
of its subsidiaries, with a variety of consulting services as
specified by CG&E's management. Specifically, but without
limitation, Consultant shall provide consulting services
("Services") to assist CG&E (i) with respect to gaming regulatory
issues in Colorado and any other jurisdiction where CG&E has a
presence; (ii) in identifying new business opportunities in
gaming and related entertainment businesses in Colorado and other
jurisdictions in the United States and internationally; (iii) in
evaluating and implementing strategic decisions regarding CG&E's
subsidiary approximately $6 million loan/investment with a
Mexican-based gaming company known as PRINGSA, including, to the
extent specifically asked by management of CG&E, being involved
in negotiations with individuals form PRINGSA; and (iv) with any
other matter which CG&E determines appropriate in connection with
its business operations.
3. Term. The term of this Agreement shall begin on
the date set forth above and shall continue through, and
automatically terminate at the end of business on, August 31,
1997, unless terminated earlier by CG&E for cause upon 30 days
prior written notice to Consultant.
4. Consideration. For the Services rendered by
Consultant during the term of this Agreement, CG&E shall pay
Consultant $29,166.67 per month. Each monthly payment shall be
made in advance, with the first payment being made upon the
mutual execution hereof for the appropriate pro rata amount for
the period from the date hereof through June 30, 1996, the next
and all succeeding payments being made on the 1st day of the
month for the next following month and the last payment being
made on August 1, 1997, for the monthly period ending on the
expiration of this Agreement. Upon the prior written approval by
ending on the expiration of this Agreement. Upon the prior
written approval by CG&E and within 30 days of the submittal of
appropriate receipts, invoices marked paid or other satisfactory
evidence, reasonable out-of-pocket expenses will be reimbursed to
Consultant. CG&E will not reimburse any out-of-pocket expenses
unless Consultant has received the prior written approval of
CG&E.
5. Right of First Refusal: Gaming Opportunity.
Consultant covenants to CG&E that he shall not participate as an
owner, partner, manager, member, investor, lender, employee,
officer, director, agent or otherwise in any new business
opportunity in the area of casino gaming in any jurisdiction in
the United States or internationally ("Gaming Opportunity")
during the term of this Agreement unless Consultant first
provides all relevant information regarding such Gaming
Opportunity to CG&E. Upon the receipt of all such relevant
information, CG&E shall be given 60 days within which to conduct
its own due diligence of such Gaming Opportunity and determine
whether it desires to pursue an involvement therein. If CG&E
gives notice to Consultant within such 60-day period that it
desires to pursue an involvement in such Gaming Opportunity,
Consultant shall be precluded from participating therein, except
to the extent allowed by CG&E. If CG&E gives notice to
Consultant within such 60-day period that it does not desire to
pursue an involvement in such Gaming Opportunity, Consultant
shall be free to participate therein in any capacity and to any
extent. Gaming Opportunity shall specifically exclude any
matters involving Consultant's current participation in Outlaws
Casino, Ltd., known as Crooks Palace in Black Hawk, Colorado.
6. Trade Secrets. Consultant acknowledges that CG&E
has trade secrets in the connection with its business.
Consultant covenants that he shall at all times be precluded from
divulging or otherwise using any and all trade secrets,
proprietary information, material, systems information, general
information, and other matters of critical importance to the
operation of the business operated by CG&E to any person or
entity, including any competitor or any potential competitor of
CG&E. In addition, Consultant covenants that he shall not at any
time use such secrets to compete, directly or indirectly, with
CG&E.
7. Independent Contractor. Consultant shall at all
times act as an independent contractor. Nothing in this
Agreement is intended to, or shall create, the relationship of
principal and agent or employer and employee between CG&E and
Consultant. CG&E is not responsible for providing any health,
accident, medical benefits, disability insurance, life insurance
benefits or other insurance benefits to Consultant. It is
Consultant's sole obligation to pay any and all income and self-
employment taxes and Consultant agrees to indemnity CG&E in the
event CG&E is ordered to pay any of such taxes or other expenses
on behalf of Consultant. In addition, by their execution hereof,
both parties specifically acknowledge the following:
CONSULTANT IS NOT ENTITLED TO WORKER'S
COMPENSATION BENEFITS. CONSULTANT IS
OBLIGATED TO PAY FEDERAL AND STATE INCOME TAX
MONIES EARNED PURSUANT TO THIS CONTRACTUAL
RELATIONSHIP.
8. Colorado Law. This Agreement and the parties
respective rights, obligations and duties hereunder shall be
governed by, construed and interpreted in accordance with the
laws of the State of Colorado.
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the day and year first above written.
COLORADO GAMING &
ENTERTAINMENT CO., a Delaware
corporation
By:
Title:
CHRISTOPHER B. HEMMETER