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 Mark M. Hemmeter ("Consultant"),
whose address for purposes of notices hereunder is 6320 Reserve
Drive, Boulder, CO 80301.
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's 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 from 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, November 30,
1996, 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
$10,416.67 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
November 1, 1996, for the monthly period 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 Place 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 indemnify 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:
MARK M. HEMMETER