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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-Q
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1999
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OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
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COMMISSION FILE NUMBER 000-22298
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SCIENTIFIC GAMES HOLDINGS CORP.
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(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 13-3615274
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(STATE OR OTHER JURISDICTION OF (IRS IDENTIFICATION NO.)
EMPLOYER)
1500 BLUEGRASS LAKES PARKWAY, ALPHARETTA, GEORGIA 30004
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (770) 664-3700
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FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR, IF CHANGED SINCE
LAST REPORT.
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INDICATE BY CHECK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS
REQUIRED TO BE FILED BY SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
1934 DURING THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE
REGISTRANT WAS REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH
FILING REQUIREMENTS FOR THE PAST 90 DAYS.
YES [X] NO [ ]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
INDICATE BY CHECK WHETHER THE REGISTRANT HAS FILED ALL DOCUMENTS AND
REPORTS REQUIRED TO BE FILED BY SECTION 12, 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 SUBSEQUENT TO THE DISTRIBUTION OF SECURITIES UNDER A PLAN
CONFIRMED BY A COURT.
YES [ ] NO [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE ISSUER'S
CLASSES OF COMMON STOCK, AS OF THE LATEST PRACTICABLE DATE: 11,896,735 SHARES OF
COMMON STOCK, $.001 PAR VALUE PER SHARE, AS OF AUGUST 2, 1999.
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PART I - FINANCIAL INFORMATION
<TABLE>
<CAPTION>
Page No.
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<S> <C>
Item 1. Consolidated Condensed Financial Statements
Consolidated Condensed Balance Sheets
June 30, 1999 and December 31, 1998.......................... 4
Consolidated Condensed Statements of Income
Three-month period ended June 30, 1999
and June 30, 1998
Six-month period ended June 30, 1999
and June 30, 1998............................................ 5
Consolidated Condensed Statements of Cash Flows
Six-month period ended June 30, 1999
and June 30, 1998............................................ 6
Notes to Consolidated Condensed Financial Statements.................. 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.......................... 9
PART II - OTHER INFORMATION
Item 1. Legal Proceedings..................................................... 15
Item 4. Submission of Matters to a Vote of Security Holders................... 15
Item 6. Exhibits and Reports on Form 8-K...................................... 16
SIGNATURES..................................................................... 16
</TABLE>
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PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
SCIENTIFIC GAMES HOLDINGS CORP.
CONSOLIDATED CONDENSED BALANCE SHEETS
(IN THOUSANDS EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
--------- ------------
(unaudited) (1)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents .............................. $ 13,732 $ 9,270
Trade receivables ...................................... 49,805 39,445
Inventories ............................................ 15,280 15,090
Prepaid expenses and other current assets .............. 3,581 2,111
Deferred income tax benefits ........................... 620 1,032
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Total current assets ............................ 83,018 66,948
PROPERTY AND EQUIPMENT, AT COST:
Land ................................................... 2,521 2,521
Buildings .............................................. 11,892 11,664
Production and other equipment ......................... 103,788 101,098
Construction-in-progress ............................... 3,566 2,047
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121,767 117,330
Less accumulated depreciation and amortization ......... (62,295) (57,386)
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59,472 59,944
OTHER ASSETS
Goodwill, net of amortization ......................... 33,245 35,282
Other assets .......................................... 17,669 17,459
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$ 193,404 $ 179,633
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable ....................................... $ 16,041 $ 16,270
Accrued liabilities .................................... 22,949 17,822
Bank debt .............................................. 13,678 12,482
Income taxes payable ................................... 1,471 3,932
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Total current liabilities ....................... 54,139 50,506
LONG-TERM LIABILITIES:
Other long-term liabilities ........................... 7,696 8,221
Deferred income taxes payable ......................... 6,786 6,694
Minority interest in consolidated subsidiaries ........ 2,654 2,306
STOCKHOLDERS' EQUITY:
Common stock par value $.001 per share:
shares authorized: 25,750,000;
issued and outstanding shares: 11,886,320 at June 30,
1999 and 11,875,737 at December 31, 1998 ............. 12 12
Additional paid-in capital ............................. 65,746 65,551
Accumulated earnings ................................... 56,637 46,201
Accumulated other comprehensive income ................. (266) 142
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Total stockholders' equity ...................... 122,129 111,906
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$ 193,404 $ 179,633
========= =========
</TABLE>
(1) Derived from audited financial statements
See accompanying notes.
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SCIENTIFIC GAMES HOLDINGS CORP.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(IN THOUSANDS EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
Three-month period Six-month period
ended June 30, ended June 30,
1999 1998 1999 1998
-------- ------- --------- -------
<S> <C> <C> <C> <C>
Revenues ......................................................... $ 57,125 $51,567 $ 109,790 $99,986
Cost of revenues ................................................. 35,576 32,735 69,294 64,292
-------- ------- --------- -------
21,549 18,832 40,496 35,694
Selling, general and administrative expenses ..................... 7,617 6,170 14,357 12,278
Depreciation and amortization .................................... 4,822 4,323 8,894 8,527
-------- ------- --------- -------
Operating income ................................................. 9,110 8,339 17,245 14,889
Other income (expense):
Interest income ............................................ 189 64 279 96
Other income ............................................... 25 68 30 22
Gain/(loss) on foreign currency ............................ (174) 38 273 28
Interest expense ........................................... 235 412 402 804
Minority interest elimination .............................. (287) 6 (716) 101
-------- ------- --------- -------
Income before income taxes ....................................... 8,628 8,103 16,709 14,332
Income tax expense ............................................... 3,198 3,250 6,273 5,703
-------- ------- --------- -------
Net income ....................................................... $ 5,430 $ 4,853 $ 10,436 $ 8,629
======== ======= ========= =======
Basic net income per common share ................................ $ 0.46 $ 0.39 $ 0.88 $ 0.71
======== ======= ========= =======
Diluted net income per common share .............................. $ 0.45 $ 0.39 $ 0.87 $ 0.70
======== ======= ========= =======
Average common shares outstanding - basic ........................ 11,885 12,316 11,885 12,153
Dilutive effect of stock options and non-vested
restricted stock awards ...................................... 108 189 108 251
-------- ------- --------- -------
Average common shares outstanding-diluted ........................ 11,993 12,505 11,993 12,404
======== ======= ========= =======
</TABLE>
See accompanying notes.
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SCIENTIFIC GAMES HOLDINGS CORP.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
Six-month period
ended June 30,
1999 1998
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<S> <C> <C>
CASH FLOW PROVIDED BY OPERATING ACTIVITIES
Net income .......................................................................... $ 10,436 $ 8,629
Adjustments to reconcile net earnings to net
cash provided by operating activities:
Depreciation ................................................................... 5,838 6,421
Amortization of intangibles .................................................... 3,056 2,106
Gain on disposal of property and equipment ..................................... (12) (7)
Stock compensation expense ..................................................... 31 285
Minority interest .............................................................. 348 0
Deferred income taxes .......................................................... 257 198
Changes in operating assets and liabilities:
Accounts receivable ....................................................... (12,752) 1,396
Inventories ............................................................... (527) (1,336)
Prepaid expenses and other assets ......................................... (2,733) (2,193)
Accounts payable .......................................................... 435 2,880
Accrued liabilities ....................................................... 7,833 (2,768)
Income taxes payable ...................................................... (1,580) (1,036)
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Net cash provided by operating activities ........................................ 10,630 14,575
CASH FLOWS USED IN INVESTING ACTIVITIES
Proceeds from sales of property and equipment ....................................... 120 131
Purchases of property and equipment ................................................. (5,956) (4,080)
Other investing activities .......................................................... -- (481)
-------- --------
Net cash used in investing activities ............................................ (5,836) (4,430)
CASH FLOWS USED IN FINANCING ACTIVITIES
Borrowings under bank debt .......................................................... 21,265 1,068
Payments on bank debt and other long-term debt ...................................... (19,771) (11,777)
Proceeds of exercise of common stock options ........................................ 8 4,575
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Net cash provided by (used in) financing activities .............................. 1,502 (6,134)
EFFECT OF EXCHANGE RATE CHANGES ON CASH ................................................. (1,834) (179)
-------- --------
NET INCREASE IN CASH AND CASH EQUIVALENTS ............................................... 4,462 3,832
CASH AND CASH EQUIVALENTS, beginning of period .......................................... 9,270 2,843
-------- --------
CASH AND CASH EQUIVALENTS, end of period ................................................ $ 13,732 $ 6,675
======== ========
SUPPLEMENTAL CASH FLOWS DISCLOSURE:
Cash paid for interest .............................................................. $ 318 $ 786
======== ========
</TABLE>
See accompanying notes.
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SCIENTIFIC GAMES HOLDINGS CORP.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1. Basis of Presentation
The accompanying unaudited consolidated condensed financial statements
have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions to
Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements and should be read
in conjunction with the financial statement disclosures contained in the
Company's 1998 Annual Report on Form 10-K for the year ended December 31,
1998. In the opinion of management, all adjustments considered necessary
for a fair presentation (which were of a normal, recurring nature) have
been included. Operating results for the three and six month periods ended
June 30, 1999 are not necessarily indicative of the results that may be
expected for the year ended December 31, 1999.
Note 2. Inventories
Inventories consist principally of instant lottery tickets, materials
related to their production and certain electronic components related to
Systems terminals which are valued at the lower of cost (first-in,
first-out method) or market. Inventories consisted of the following at:
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
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(In Thousands)
<S> <C> <C>
Finished goods ......................... $ 8,101 $ 7,939
Work-in-process ........................ 1,268 1,087
Raw materials .......................... 5,911 6,064
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$15,280 $15,090
======= =======
</TABLE>
Note 3. Contingencies
Refer to the Company's Form 10-K for the year ended December 31, 1998
and the Company's Form 10-Q for the quarter ended March 31, 1999 for a
description of pending legal proceedings, with respect to which there has
been the following material development since such date. The Company has
been informed that on June 4, 1999, Empresa Colombiana de Recursos Para la
Salud, S.A. ("Ecosalud") filed an executory proceeding in Colombia against
the Company seeking payment of 90,051,599,475 Colombian pesos
(approximately US$50,000,000), although the Company has not yet been served
with the proceeding. The claims upon which this action are allegedly based
relate to the claims upon which similar actions were made by Ecosalud
against the Company in 1993 in Colombia and in 1996 in the United States
District Court for the Northern District of Georgia, Atlanta Division (the
"prior actions"), which have been previously disclosed by the Company. The
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current action is alleged to have been filed immediately prior to the
expiration of the Colombian statute of limitation on June 7, 1999 for
executory actions by Colombian public entities. Upon advice of Colombian
counsel, the Company believes it has significant defenses to the current
action, including the existence of pending litigation on the same subject
matter and an earlier ruling by the Colombian Court and the United States
District Court in the prior actions that the current claims must be decided
by arbitration.
Note 4. Comprehensive Income
Total comprehensive income was $5.4 million and $10.0 million for the
three-month and six-month periods ended June 30, 1999 and $4.7 million and
$9.3 million for the three-month and six-month periods ended June 30, 1998,
respectively.
Note 5. Segment Information
<TABLE>
<CAPTION>
OPERATING SEGMENT INFORMATION THREE MONTH PERIOD SIX MONTH PERIOD
ENDED JUNE 30 ENDED JUNE 30
(In thousands) 1999 1998 1999 1998
-------- -------- --------- --------
<S> <C> <C> <C> <C>
Revenue from external customers:
Instant Ticket and Related Services $ 45,917 $ 47,018 $ 86,673 $ 89,670
Intersegment Revenue (1,896) (2,250) (3,565) (3,905)
Systems 11,161 4,294 23,054 10,040
Intersegment Revenue 1,896 2,250 3,565 3,905
Corporate 47 255 63 276
-------- -------- --------- --------
Total revenue from external customers 57,125 51,567 109,790 99,986
======== ======== ========= ========
Operating income
Instant Ticket and Related Services 9,729 9,672 17,604 17,940
Systems 2,807 1,359 5,731 1,809
Corporate (3,426) (2,692) (6,089) (4,860)
Total operating income 9,110 8,339 17,245 14,889
Interest expense, net (46) (348) (123) (708)
Other (436) 112 (413) 151
======== ======== ========= ========
Income before income tax $ 8,628 $ 8,103 $ 16,709 $ 14,332
======== ======== ========= ========
</TABLE>
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SCIENTIFIC GAMES HOLDINGS CORP.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
GENERAL
The Company's revenues are generated primarily from sales of products and
services to governmentally operated or sanctioned lotteries worldwide and, to a
lesser extent, non-lottery related entities both in the United States and
worldwide. These sales are categorized into two main segments: (1) Instant
Ticket and Related Services and (2) Systems.
In the Instant Ticket and Related Services segment, the Company primarily
supplies game design, sales and marketing support, instant ticket manufacturing
and delivery, inventory management and distribution, and retailer telemarketing
and field services. In addition, this segment includes promotional instant
tickets and pull-tab tickets which are sold to both lottery and non-lottery
customers and prepaid phone cards which are sold to telecommunications
companies.
In the Systems segment, the Company primarily supplies transaction
processing software that accommodates instant ticket accounting and validation
and on-line lottery games, point-of-sale terminal hardware which connects to
these systems, central site computers and communication hardware which run these
systems, and ongoing support and maintenance services for these products. This
segment also includes software, hardware and support for sports betting and
credit card processing systems for non-lottery customers.
Instant Ticket and Related Services revenues are generally based on a price
per 1,000 tickets delivered or based upon a percentage of the lottery's sales to
the public over a contract period. Systems revenues may be based on a fixed
price for the product or service or based upon a percentage of the lottery's
sales to the public over a contract period.
Through June 30, 1999, the Company has:
- received one-year extensions on its current Instant Ticket and
Related Services contracts with the Colorado Lottery, DC Lottery
and Charitable Games Control Board, Illinois Lottery, Iowa
Lottery, Kentucky Lottery, Minnesota State Lottery, New Mexico
Lottery, Oregon State Lottery, South Dakota Lottery and the
Washington Lottery.
- received two six-month extensions on its instant ticket contract
as an additional supplier from the California State Lottery and
several smaller orders from new and existing international
lottery and prepaid phone card customers.
- been awarded a new two-year contract to provide Instant Tickets
and Related Services by the Massachusetts Lottery.
- received a two-year contract to provide instant ticket
telemarketing, distribution services and systems software and
hardware to support instant tickets to the New York State
Lottery.
- been awarded an emergency six-month Instant Ticket and Services
contract by the Texas Lottery Commission. The
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Texas contract authorizes the Company to provide instant tickets
pending decision by the Executive Director of the Texas Lottery
on the protest filed by a non-winning bidder upon the recent
award of the primary instant ticket contract to the Company,
although the award of the primary contract to the Company was
confirmed by the Executive Director on August 10, 1999 in her
response to the protest filed by the non-winning bidder.
RESULTS OF OPERATIONS
Three-month period ended June 30, 1999 compared to three-month period ended June
30, 1998.
Revenues for the three-month period ended June 30, 1999 increased $5.6
million, or 10.8% over the revenues for the three-month period ended June 30,
1998. The increase was primarily due to additional revenues generated from sales
to new and existing Systems customers and from sales generated by other printing
activities. The increase was partially offset by a decrease in Instant Ticket
and Related Services sales from the United States to domestic and international
customers and from reduced international promotional sales. Instant Ticket and
Related Services revenues accounted for approximately 77.1% and 81.0% of the
Company's gross revenues for the three-month periods ended June 30, 1999 and
1998, respectively.
Gross margins increased to 37.7% for the three-month period ended June 30,
1999 from 36.5% for the three-month period ended June 30, 1998. The margin
increase was mainly attributable to an increase in sales to Systems customers
and continued efficiency improvements in the Company's Instant Ticket and
Related Services segment. The margin increase was partially offset by lower
equivalent sales prices charged on certain instant ticket lottery contracts
awarded or extended and lower instant ticket export sales. The lower equivalent
sales prices were a result of competitive pricing pressures in the industry.
Selling, general and administrative expenses for the three-month period
ended June 30, 1999 increased $1.4 million or 23.5%, over the same period of
1998. SG&A expenses increased as a percentage of revenues to 13.3% from 12.0%.
The increase was due primarily to the additional selling, general and
administrative expenses resulting from a foreign joint venture formed in
December 1998 and additional expenses required to support increased sales
activity.
Depreciation and amortization increased for the three-month period ended
June 30, 1999 by $499,000 or 11.5% over the comparable period of 1998 due
primarily to additional depreciation expenses from ongoing capital expenditures
and goodwill amortization related to a foreign joint venture.
Interest income for the three-month period ended June 30, 1999 increased
$125,000, or 195.3%, compared to the three-month period ended June 30, 1998. The
increase was attributable to higher average cash and cash equivalents balances
during the same comparable periods.
Other income for the three-month period ended June 30, 1999 decreased
$43,000, or 63.2%, compared to the three-month period ended June 30, 1998. The
decrease was attributable to fewer asset dispositions in the three-month period
ended June 30, 1999.
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Gain/(loss) on foreign currency for the three-month period ended June 30,
1999 resulted in a loss of $174,000 compared with a gain of $38,000 for the same
period 1998. The loss resulted primarily from fluctuations in exchange rates on
non-U.S. dollar holdings.
Interest expense for the three-month period ended June 30, 1999 decreased
$177,000 or 43.0% from the three-month period ended June 30, 1998. The decrease
was due to the decrease in the average balance outstanding under the Company's
Bank Credit Agreement during the three month period ended June 30, 1999(refer to
the Company's 10-K for the year ended December 31, 1998 for a description of the
Company's Bank Credit Agreement) compared to the prior period.
Income tax expense for the three-month period ended June 30, 1999 decreased
$52,000, or 1.6% as compared to the same three-month period of 1998 due to a
reduction in the Company's effective income tax rate. The effective income tax
rate decreased from 40.1% to 37.1% for the three month periods ended June 30,
1998 and June 30, 1999, respectively. The decrease in the effective income tax
rate was partially attributable to additional tax credits.
As a result of the foregoing, net earnings for the three-month period ended
June 30, 1999 were $5.4 million compared to $4.9 million for the comparable
period ended June 30, 1998.
Earnings per common share (diluted) for the three-month period ended June
30, 1999 were $0.45 compared to $0.39 for the comparable period in 1998. The
increase in earnings per common share was primarily due to the increase in
earnings and a decrease in the weighted average number of common equivalent
shares outstanding.
Six-month period ended June 30, 1999 compared to six-month period ended June 30,
1998.
Revenues for the six-month period ended June 30, 1999 increased $9.8
million, or 9.8% over the revenues for the six-month period ended June 30, 1998.
The increase was primarily due to additional revenues generated from sales to
new and existing systems customers and from sales generated by other printing
activities. The increase was partially offset by a decrease in Instant Ticket
and Related Services sales from the United States to domestic and international
customers and from reduced international promotional sales. Instant Ticket and
Related Services revenues accounted for approximately 75.7% and 85.8% of the
Company's gross revenues for the three-month periods ended June 30, 1999 and
1998, respectively.
Gross margins increased to 36.9% for the six-month period ended June 30,
1999 from 35.7% for the six-month period ended June 30, 1998. The margin
increase was mainly attributable to an increase in sales to Systems customers
and continued efficiency improvements in the Company's Instant Ticket and
Related Services segment. The margin increase was partially offset by lower
equivalent sales prices charged on certain instant ticket lottery contracts
awarded or extended and lower instant ticket export sales. The lower equivalent
sales prices were a result of competitive pricing pressures in the industry.
Selling, general and administrative (SG&A) expenses for the six-month
period ended June 30, 1999 increased $2.1 million or 16.9%, over the same period
of 1998. As a percentage of revenues, SG&A expenses increased from
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12.3% to 13.1%. The increase was due primarily to the additional selling,
general and administrative expenses resulting from a foreign joint venture
formed in December 1998 and additional expenses required to support increased
sales activity.
Depreciation and amortization increased for the six-month period ended June
30, 1999 by $367,000 or 4.3% over the comparable period of 1998 due primarily to
additional depreciation expenses from ongoing capital expenditures and goodwill
amortization related to a foreign joint venture.
Interest income for the six-month period ended June 30, 1999 increased
$183,000, or 190.6%, compared to the six-month period ended June 30, 1998. The
increase was attributable to higher average cash and cash equivalents balance
during the same comparable periods.
Other income for the six-month period ended June 30, 1999 increased $8,000
or 36.4%, compared to the six-month period ended June 30, 1998. The increase was
attributable to more net gains from assets dispositions in the six-month period
ended June 30, 1999 than in the comparable period in 1998.
Gain on foreign currency for the six-month period ended June 30, 1999
increased by $245,000 to $273,000, compared with a gain of $28,000 for the
comparable period in 1998. The gains primarily resulted from fluctuations in
exchange rates on non-U.S. dollar holdings.
Interest expense for the six-month period ended June 30, 1999 decreased
$402,000, or 50.0% from the six-month period ended June 30, 1998. The decrease
was due to the decrease in the average balance outstanding under the Company's
Bank Credit Agreement (refer to the Company's 10-K for the year ended December
31, 1998 for a description of the Company's Bank Credit Agreement) compared to
the prior period.
Income tax expense for the period ended June 30, 1999 decreased $570,000,
or 10.0% as compared to the same six-month period of 1998 due to a reduction in
the Company's effective income tax rate. The effective income tax rate for the
three month periods ended June 30, 1999 and June 30, 1998 was 37.5% and 39.8%,
respectively. The decrease in the effective income tax rate was partially
attributable to additional tax credits.
Earnings per common share (diluted) for the six-month period ended June 30,
1999 were $0.87 compared to $0.70 for the comparable period in 1998. The
increase in earnings per common share was primarily due to the increase in
earnings and a decrease in the weighted average number of common equivalent
shares outstanding.
LIQUIDITY AND CAPITAL RESOURCES
The Company's cash position remains strong. The Company's cash and cash
equivalents balance increased by approximately $4.5 million during the six-month
period ended June 30, 1999 although the Company's net borrowings under its Bank
Credit Agreement increased by $1.2 million during the same period.
For the six-month period ended June 30, 1999, net cash provided by
operating activities decreased by $4.0 million to $10.6 million from $14.6
million for the comparable period in 1998. The primary contributions to cash
from operating activities during the six-month period ended June 30, 1999 were
net income, depreciation and amortization and an increase in
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accrued liabilities. Accounts receivable increased by $10.4 million from $39.4
million at December 31, 1998 to $49.8 million at June 30, 1999, and accrued
liabilities increased by $5.1 million from $17.8 million at December 31, 1998 to
$22.9 million at June 30, 1999. The increase in accounts receivable and accrued
liabilities are primarily due to activity related to Systems projects in
Australia, Canada, France and Greece. Cash provided by operations was used to
fund working capital requirements, purchase additional property and equipment
and make payments on the outstanding balance under the Bank Credit Agreement.
Net cash used in investing activities for the six-month period ended June
30, 1999 increased by approximately $1.4 million to $5.8 million from $4.4
million for the six-month period ended June 30, 1998. Cash was used to acquire
additional property and equipment.
The Company's financing activities generated cash of $1.5 million for the
six months ended June 30, 1999 and used cash of $6.1 million in the six months
ended June 30, 1998. The Company increased the balance outstanding under the
Bank Credit Agreement at June 30, 1999 by a net amount of approximately $1.2
million compared to the balance at December 31, 1999. Net borrowings under the
Bank Credit Agreement were $13.7 million at June 30, 1999.
The Company believes that funds provided by operations, available
borrowings under its Bank Credit Agreement and the ability to obtain alternative
sources of financing should permit the Company to fund its operations, working
capital requirements and obligations, as well as other potential investment or
business opportunities.
IMPACT OF YEAR 2000
Refer to the Company's Form 10-K for the year ended December 31, 1998 for a
description of the Company's Year 2000 ("Y2K") program, business systems,
interfaces with third parties, estimated Y2K costs and contingency planning,
with respect to which there have been the following developments since such
date. The Company spent approximately $485,000 on Y2K compliance costs during
the six-month period ended June 30, 1999. These costs included capital
expenditures and internal labor costs which management believes would have
otherwise been incurred as part of the Company's regular program of
modernization and improvement. The Company now estimates that its total Y2K
compliance costs (including software, systems and equipment) incurred since 1997
have been approximately $1.7 million. The Company believes that completed and
planned modifications and conversions of its internal systems and equipment will
allow it to be Y2K ready prior to December 31, 1999.
FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains certain statements and
projections (including statements concerning plans and objectives of management
for future operations and services and statements concerning revenue
expectations), other than those covering historical information, that should be
considered forward-looking and subject to certain risks and uncertainties. Such
forward-looking statements are based on management's belief as well as
assumptions made by, and information currently available to, management pursuant
to "safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. The Company's actual results may differ materially from the plans
envisioned in, or results projected by,
13
<PAGE> 14
those statements if the Company's assumptions prove to be incorrect or for a
variety of other reasons, including those relating to factors identified in the
Company's Annual Report on Form 10-K for the year ended December 31, 1998 as
part of a Cautionary Statement for purposes of such safe harbor. The Company
cautions that such factors are not exclusive. The Company does not undertake to
update any forward-looking statement that may be made from time to time by, or
on behalf of, the Company.
14
<PAGE> 15
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Refer to the Company's Form 10-K for the year ended December 31, 1998 and the
Company's Form 10-Q for the quarter ended March 31, 1999 for a description of
pending legal proceedings, with respect to which there has been the following
material development since such date. The Company has been informed that on June
4, 1999, Empresa Colombiana de Recursos Para la Salud, S.A. ("Ecosalud") filed
an executory proceeding in Colombia against the Company seeking payment of
90,051,599,475 Colombian pesos (approximately US$50,000,000), although the
Company has not yet been served with the proceeding. The claims upon which this
action are allegedly based relate to the claims upon which similar actions were
made by Ecosalud against the Company in 1993 in Colombia and in 1996 in the
United States District Court for the Northern District of Georgia, Atlanta
Division (the "prior actions"), which have been previously disclosed by the
Company. The current action is alleged to have been filed immediately prior to
the expiration of the Colombian statute of limitation on June 7, 1999 for
executory actions by Colombian public entities. Upon advice of Colombian
counsel, the Company believes it has significant defenses to the current action,
including the existence of pending litigation on the same subject matter and an
earlier ruling by the Colombian Court and the United States District Court in
the prior actions that the current claims must be decided by arbitration.
ITEMS 2,3 AND 5 ARE NOT APPLICABLE AND HAVE BEEN OMITTED.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The annual meeting of the Company's shareholders was held on May 21, 1999. At
the meeting the following matters were voted upon, with the following results:
1. Election of Directors. The following directors were elected, for terms
ending at the annual meeting in the year indicated:
<TABLE>
<CAPTION>
Term Votes Votes
Name of Director Ending In Favor Against Abstentions Non-votes
- ---------------- ------ ---------- ------- ----------- ---------
<S> <C> <C> <C> <C> <C>
Paul F. Balser 2002 10,214,997 0 7,700 1,661,265
Dennis L. Whipple 2002 10,211,797 0 10,900 1,661,265
William G. Malloy 2002 10,194,997 0 27,700 1,661,265
Continuing Directors:
William F. Behm 2001 N/A N/A N/A N/A
Mark E. Jennings 2001 N/A N/A N/A N/A
Dr. Edith Manns 2000 N/A N/A N/A N/A
Frank S. Jones 2000 N/A N/A N/A N/A
</TABLE>
2. Approval of 1999 Employee Stock Purchase Plan. The 1999 Employee Stock
Purchase Plan allows employees of the Company to purchase stock of the
15
<PAGE> 16
Company at discounted rates. The results of the voting with respect to the
1999 Employee Stock Purchase Plan were as follows:
<TABLE>
<CAPTION>
Votes Votes
In Favor Against Abstentions Non-votes
-------- ------- ----------- ---------
<S> <C> <C> <C>
8,868,823 1,343,147 10,727 1,661,265
</TABLE>
3. Approval of the selection of Ernst & Young LLP as the Company's auditors
for the 1999 fiscal year. The results of the voting were as follows:
<TABLE>
<CAPTION>
Votes Votes
In Favor Against Abstentions Non-votes
-------- ------- ----------- ---------
<S> <C> <C> <C>
10,212,799 3,115 6,783 1,661,265
</TABLE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
#10.53 Supply Agreement for Instant Lottery
Computer Management System.
Confidential treatment has been
requested for portions of this
exhibit, which confidential portions
have been filed separately with the
Securities and Exchange Commission.
#27 Financial Data Schedule (for SEC use only)
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the six-months ended June 30,
1999
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
SCIENTIFIC GAMES HOLDINGS CORP.
Date: August 16, 1999 By: /s/ WILLIAM G. MALLOY
---------------------------
William G. Malloy
President and
Chief Executive Officer
Date: August 16, 1999 By: /s/ CLIFF O. BICKELL
---------------------------
Cliff O. Bickell
Vice President, Treasurer,
and Chief Financial Officer
16
<PAGE> 1
Exhibit 10.53
SUPPLY AGREEMENT
FOR INSTANT LOTTERY COMPUTER
MANAGEMENT SYSTEM
PROJECT FORTUNA
<PAGE> 2
SUPPLY AGREEMENT
FOR INSTANT LOTTERY COMPUTER
MANAGEMENT SYSTEM
BETWEEN:
LA FRANCAISE DES JEUX,
Societe Anonyme dEconomie Mixte, with a registered capital of 500,000,000
Francs, registered at the Register of Commerce and Companies under number
B 315 065 292, the registered office of which is located at 5 rue Beffroy,
92200 Neuilly-sur-Seine, and represented by its President (President
Directeur General), Mr. Bertrand de GALLE,
(hereafter referred to as TDY)
AND:
SCIENTIFIC GAMES INC. An American corporation registered at the Companies
Register in the state of Delaware, USA, the registered office of which is
located at 1500, Bluegrass Lake Parkway, Alpharetta, GA, USA 30004, and
represented by its Vice President International Sales & Marketing, Mr. Bruce H.
Longhurst,
(hereafter referred to as "SGI")
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<S> <C> <C>
1. DEFINED TERMS AND REFERENCE ................................................................................7
1.1 DEFINITIONS ............................................................................................7
1.2 INTERPRETATION .........................................................................................8
2. PURPOSE ....................................................................................................8
3. TRAINING ..................................................................................................10
3.1 TRAINING WITH RESPECT TO THE PARAMETERIZATION OF THE SYSTEM ...........................................10
3.2 TRAINING WITH RESPECT TO THE OPERATION OF THE SYSTEM ..................................................10
4. SERVICES ASSOCIATED WITH THE SUPPLY OF THE SYSTEM .........................................................11
5. FUNCTIONAL INTEGRITY AND LEGAL UNITY OF THE SYSTEM ........................................................11
6. SGI'S APPOINTMENT AS PROJECT MANAGER (MAITRE D'OEUVRE) ....................................................12
7. OBLIGATIONS OF FDJ ........................................................................................12
8. THE REPRESENTATIVES OF THE PARTIES ........................................................................13
9. PROGRESS COMMITTEE ........................................................................................13
9.1 DUTIES..................................................................................................0
9.2 MEETINGS AND REPORTS ..................................................................................14
10. AUDITS ....................................................................................................14
11. MODIFICATIONS TO THE SPECIFICATIONS OF THE SYSTEM .........................................................15
12. GENERAL SCHEDULE FOR DELIVERY OF THE SYSTEM ...............................................................15
13. SALE OF HARDWARE ..........................................................................................15
14. SET-UP AND ENVIRONMENT ....................................................................................16
15. TRANSPORT .................................................................................................16
16. DELIVERY ..................................................................................................16
17. INSTALLATION ..............................................................................................16
18. EFFECTIVE DATE OF AGREEMENT ...............................................................................17
19. PRICE AND CURRENCY ........................................................................................17
19.1 PRICE ................................................................................................17
19.2 CURRENCY .............................................................................................17
20. INVOICES ..................................................................................................17
21. PERFORMANCE BOND ..........................................................................................18
22. TRANSFER OF TITLE AND RISK ................................................................................18
23. LICENSE FOR THE USE OF THE SOFTWARE .......................................................................18
23.1 OWNERSHIP OF THE SOFTWARE ...........................................................................18
</TABLE>
<PAGE> 4
<TABLE>
<S> <C> <C>
23.2 EXTENT OF USAGE RIGHTS ..............................................................................19
23.3 DELIVERY AND INSTALLATION............................................................................20
23.4 INTEROPERABILITY.....................................................................................21
23.5 TERM OF GRANT OF USE RIGHTS .........................................................................21
24. USE OF SOURCE CODE ........................................................................................21
25. LATE PENALTIES ............................................................................................22
26. CONTINUING FUNCTIONALITY OF THE SYSTEM ....................................................................23
27. ACCEPTANCE OF PHASES AND THE SYSTEM .......................................................................24
27.1 ESTABLISHMENT OF AN ACCEPTANCE PROCEDURE .............................................................24
27.2 METHOD OF ACCEPTANCE .................................................................................24
27.3 ACCEPTANCE PROCEDURE .................................................................................25
27.4 PROVISIONAL ACCEPTANCE ...............................................................................25
27.5 FINAL ACCEPTANCE .....................................................................................25
27.6 EVENTS AFFECTING ACCEPTANCE ..........................................................................26
27.7 PERFORMANCE REQUIREMENTS .............................................................................27
28. WARRANTY ..................................................................................................28
28.1 ORGANIZATION OF RELATIONS BETWEEN FDJ AND SGI FOR THE WARRANTY OF
HARDWARE AND SOFTWARE RELATING TO THE SYSTEM ..............................................................28
28.2 WARRANTY IN RESPECT OF HARDWARE ......................................................................29
28.3 SOFTWARE WARRANTY ....................................................................................
28.4 PENALTIES ............................................................................................32
28.5 INFRINGEMENT ........................................................................................ 32
29. SOFTWARE MAINTENANCE.......................................................................................33
30. HARDWARE MAINTENANCE.......................................................................................33
31. LIABILITY..................................................................................................34
31.1. LIABILITY............................................................................................34
31.2. LIMITATION OF LIABILITY..............................................................................34
32. LIEN - COMPENSATION........................................................................................35
33. INSURANCE..................................................................................................35
34. PERSONNEL..................................................................................................35
35. FORCE MAJEURE..............................................................................................35
36. TERMINATION................................................................................................36
36.1 METHODS OF TERMINATION (RESILIATION OU RESOLUTION)....................................................36
36.2 TERMINATION FOR DISAGREEMENT WITH REGARD TO THE ACCEPTANCE FORM.......................................36
36.3 TERMINATION (RESILIATION OU RESOLUTION) FOR FAILURE (ECHEC) WITH RESPECT
TO AN ACCEPTANCE......................................................................................36
36.5 FDJ'S RIGHT TO TERMINATION WITHOUT CAUSE..............................................................36
37. ASSIGNMENT.................................................................................................37
38. SUB-CONTRACTING............................................................................................38
39. CONFIDENTIALITY............................................................................................38
40. ADMINISTRATIVE MEASURES....................................................................................39
</TABLE>
<PAGE> 5
<TABLE>
<S> <C>
41. LANGUAGE ..................................................................................................39
42. ENTIRE AGREEMENT ..........................................................................................39
43. NO WAIVER .................................................................................................39
44. AMENDMENT .................................................................................................39
45. REFERENCES ................................................................................................40
46. INTERPRETATION OF AGREEMENT ...............................................................................40
47. INDEPENDENCE OF THE PARTIES ...............................................................................40
48. HEADINGS ..................................................................................................40
49. GOVERNING LAW AND DISPUTES ................................................................................40
49.1 GOVERNING LAW ........................................................................................40
49.2 ARBITRATION ..........................................................................................41
49.3 CHOICE OF DOMICILE AND JURISDICTION ..................................................................41
49.4 NOTICE ...............................................................................................41
</TABLE>
LIST OF ANNEXES
ANNEX 1 DESCRIPTION OF THE SYSTEM, ITS FUNCTIONALITIES AND INTERFACES
ANNEX 2 SPECIFICATIONS OF SYSTEM HARDWARE
ANNEX 3 LIST OF THE SYSTEM SOFTWARE AND APPLICATIONS
ANNEX 4 DELIVERY SCHEDULE AND MILESTONE DEADLINES
ANNEX 5 SERVICES AND DELIVERABLES OF FDJ
ANNEX 6 SPECIFICATIONS (cahier des charges)
ANNEX 7 PRICE AND PAYMENT SCHEDULE
ANNEX 8 MAINTENANCE
ANNEX 9 PERFORMANCE OBLIGATIONS
ANNEX 10 REPRESENTATIVES OF THE PARTIES AND MEMBERS OF PROGRESS
COMMITTEE
ANNEX 11 SYSTEM EXPLOITATION OBLIGATIONS OF SGI
ANNEX 12 PERFORMANCE BOND
ANNEX 13 SUB-LICENSES FOR THE USE OF SOFTWARE
ANNEX 14 OPTIONAL GOODS AND SERVICES
ANNEX 15 TELECOMMUNICATION NETWORK
ANNEX 16 SYSTEM DOCUMENTATION
ANNEX 17 [CODIFICATION - BAR CODIFICATION]
ANNEX 18 TICKET PRINTING SPECIFICATIONS
ANNEX 19 SCISCAN TERMINALS SUPPLY AGREEMENT BETWEEN FDJ AND SGI
<PAGE> 6
PREAMBLE:
WHEREAS, FDJ exploits and commercializes lottery games in France, comprising
instant lottery games that are commercialized in the form of tickets (hereafter
"Tickets"), whereby the player scratches away a latex-covered zone to determine
whether he has won;
WHEREAS, by this agreement the parties intend to computerize the distribution,
validation and management of Tickets so as to allow for the control of winning
Tickets under optimal security conditions;
WHEREAS, FDJ is responsible for the legal aspects, as well as their implications
with respect to the computer systems, concerning the management of instant
lottery games operated from an automated system;
WHEREAS, SGI owns certain technology and know-how used for the purpose of
validating instant lottery tickets by electronically reading the bar code on the
ticket while electronically scanning the latex on the ticket to determine if the
proper amount of latex has been removed based on established game parameters
(the "SciScan Technology"). SciScan Technology is used in the functionality of
certain on-line terminals to perform these validation functions (the "SciScan
Terminals"). SciScan Terminals are linked on-line to a central computer system
to enable the SciScan Terminals to perform these validation functions.
WHEREAS, SGI's offer is based on a proven design and materials, offering both
guaranteed performance and state-of-the-art technology;
WHEREAS, the offer of SGI has been supplemented in order to include certain
important specifications of the Cahier des Charges set forth in Annex 6, which
was developed by FDJ over several years until such time as FDJ decided to buy
from SGI an existing solution taking into account most of FDJ's specifications.
Such offer has been studied, accepted and agreed on in order that SGI may
accomplish the following:
the supply of hardware and software for a Ticket management computer system
which incorporates the SciScan Technology (hereafter the "System "), to be
commercialized via FDJ's Agents, and particularly through its sale distribution
system of Retailers;
the proper implementation and functioning of such System for FDJ subject to the
terms and conditions set forth in this Agreement, it being expressly provided
that the assistance in the operation thereof shall be undertaken by SGI during
the first year following the acceptance of the Pilot Phase. At the end of the
first year, SGI shall take the necessary steps so as to allow FDJ to run the
System alone according to its choice in accordance with the user documentation
provided by SGI; and the supply of SciScan Terminals to be connected to the
System, according to the terms and conditions of Annex 19.
<PAGE> 7
WHEREAS, with respect to the above, in view of FDJ's responsibility with respect
to joint cooperation, advice and final acceptance, the parties have agreed upon
the preceding services, taking especially into account SGI's offer, the
modifications made to said offer, and the requirements of FDJ.
THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:
1. DEFINED TERMS AND REFERENCE
1.1 Definitions
For the purposes of this Agreement, except as the context may otherwise require,
the following terms shall have the meanings indicated:
Agreement means this agreement including all of its annexes;
Agent means the person, company or other entity, including FDJ, responsible for
a certain number of Retailers within a specified region. The Agent is required,
in particular, to oversee the supply to the Retailers, to manage outlays of
winnings, to maintain the sales network, and to collect certain revenues of
Retailers in connection with instant games operations;
DDP is the incoterm "DDP" (Delivered Duty Paid) under the 1990 Incoterms of the
ICC;
Faults is defined in Section 28.2;
Milestone Deadline has the meaning given to it in Section 25;
Retailer means the point-of-sale where instant lottery games are commercialized
to the public;
Software has the meaning given to it in Section 2;
Phase has the meaning given to it in Section 2;
Evaluation Phase has the meaning given to it in Section 2;
Deployment Phase has the meaning given to it in Section 2;
Pilot Phase has the meaning given to it in Section 2;
PrOo means the entity (GIE) whose principal aim is the undertaking of all
studies, inquiries, purchases, services and organization concerning the national
lottery for the purposes of improving or increasing the results of such
activity;
Chairman means the qualified representative of FDJ in accordance with Article 9;
<PAGE> 8
SciScan Technology has the meaning given to it in the Preamble; SciScan Terminal
has the meaning given to it in the Preamble.
Sub-System has the meaning given to it in Section 2;
System has the meaning given to it in the preamble; Field Tests has the meaning
given to it in Section 2; and Ticket has the meaning given to it in the
preamble.
1.2 Interpretation
In this Agreement:
a) unless the context requires otherwise, defined terms and references to
the singular shall be deemed to include the plural and vice versa;
b) headings and the use of bold typeface shall be ignored;
c) except as may be expressly stated otherwise, all references to
Sections, sub-Sections or annexes shall be references to Sections,
sub-Sections and annexes of this Agreement; and
d) days shall refer to calendar days, unless otherwise provided hereunder.
2. PURPOSE
SGI shall supply to FDJ a Ticket management computer system, to be
commercialized, directly to players or via FDFs Agents, through its sale
distribution system of Retailers, subject to and in accordance with the terms
and conditions of this Agreement.
The System supplied by SGI shall include sub-systems (hereafter the
"Sub-Systems") corresponding to the various phases of performance of this
Agreement. The System, its subsystems and the interfaces to the FDJ system are
described in Annex 1.
The System and the Sub-Systems shall include the supply of:
- hardware, the list of specifications of which hardware is set
forth in Annex 2 and Annex 19;
- the System software which includes the SciScan Terminal
software (hereafter, the "Software"), the list of which is set
forth in Annex 3; and
- the accompanying services described in Section 4 necessary for
the integration and functioning of the System throughout the
various stages of implementation of this Agreement.
<PAGE> 9
The performance of this Agreement shall be carried out with a preliminary phase
and four (4) additional phases (each, a "Phase") in accordance with Annex 4.
The Preliminary Phase is intended to demonstrate that the SciScan Terminals can
communicate, using the protocol Bet-Net 5.0, with the central site through the
X.25 system.
A first evaluation Phase (hereafter, the "Evaluation Phase") shall be aimed at
the verification of performance set forth in Annex 9 and the capacity
(volumetrie) of the System and, notably, that the hardware and software
architecture of the System shall be such so as to support and deal with all
transactions linked to the FDYs distribution network (i.e. Agents and
Retailers).
In the event of final acceptance of the Evaluation Phase, a second Phase
(hereafter the "Pilot Phase") shall be aimed at the verification in a test
environment of the specifications of the System subject to, and in accordance
with the specification requirements of the System set forth in Annex 1,
including without limitation, the functions, response times, input and output
system interface with FDJ systems, duration of batch processing, the proper
network functionality with the telecommunication network of FDJ as described in
Annex 15 and integration with the FDJ applications with respect to FDJ's
internal management, to Agents, to Pr6lo and to accounting.
In the event of the final acceptance of the Pilot Phase, a third Phase shall be
implemented for the purposes of carrying out a field test (hereafter the "Field
Test") which shall be aimed at the verification, under actual market conditions,
of the results of the Pilot Phase.
Finally, in the event of final acceptance of the Field Test, a fourth System
deployment Phase shall be carried out (hereafter, the "Deployment Phase").
Deliverables, associated services and acceptance of each phase may commence
simultaneously in order to optimize the performance schedule of this Agreement,
provided that the parties so agree, which agreement shall not be unreasonably
withheld.
Under this Agreement, SGI shall provide assistance in the operation of the
System for the duration of the contract guarantee period provided for in Section
28.3 of this Agreement, subject to and in accordance with the terms set forth in
Annex 11.
After the first year of assistance in operation of the System by SGI, FDJ can,
with three month's notice, request that SGrs operation of the System be renewed
for a six-month period which shall be automatically renewed unless otherwise
objected to by either party in accordance with Annex 11.
SGI shall supply to FDJ SciScan Terminals under the terms and conditions
described in the Supply Agreement set forth in Annex 19 so that the SciScan
Terminals are functionally compatible with the System and are delivered
according to the schedule of Annex 4.
At the request of FDJ, SGI will provide to FDJ optional services relating to the
System and described in Annex 14.
<PAGE> 10
3. TRAINING
Under this Agreement, SGI shall provide the following training:
3.1 Training With Respect To The Parameterization Of The System
This training shall consist of training FDJ personnel in order that FDJ can, on
an independent basis, parameterize the System in order to implement the instant
lottery games that it will commercialize.
SGI shall also train a reasonable number of the persons appointed by FDJ upon
the launch of new games.
To this effect, SGI shall communicate to FDJ the information (and the source
codes for parameterization of the Software if such source codes are truly
necessary) for FDJ to parameterize the System as set forth above.
Training for the parameterization of the System in order to implement the
instant lottery games commercialized by FDJ shall consist of training at the
central site a reasonable number of persons appointed by FDJ for five (5) days
beginning upon final acceptance of the Pilot Phase.
This training must be accompanied by manuals in English and French as well as
with a parameterization manual in the English language.
3.2 Training With Respect To The Operation Of The System
This training shall consist of training the FDJ personnel as to the operation of
the System beginning from the Field Test and until the expiration of the
warranty period set forth in Section 28.
Training with respect to the operation of the System includes training as to the
operation of the System as well as training the trainers in charge of the
training of the users of the System.
Training for the operation of the System shall consist of training a reasonable
number of persons appointed by FDJ at the central site upon the final acceptance
of the Pilot Phase, so that these persons may operate the System on an
independent basis from the end of the warranty set forth in Section 28.
Documentation in French and English shall be provided to these persons during
this training session, as well as a manual of operation of the System in
English.
Training of the persons in charge of training the users of the System shall
consist of (i) training 10 persons for the training of the users dedicated to
the computer development of FDJ with respect to input and output communications
on the System, and (ii) training 10 persons for the training of the end users of
the System (Agents, Retailers, FDJ employees, etc.). This training must be
accompanied by a final end user operation manual in the French language.
<PAGE> 11
4. SERVICES ASSOCIATED WITH THE SUPPLY OF THE SYSTEM
Under this Agreement, SGI shall:
a) transport, deliver, install, assemble, enable and conduct
tests in respect of the items set forth above;
b) ensure the assistance in operation of the System during the
first year following the final acceptance of the Pilot Phase;
C) offer ongoing maintenance of the System (including, but not
limited to, hardware and Software) and its evolution; and
d) authorize FDJ to freely use the information relating to ticket
codification set forth in Annex 17 and the ticket printing
specifications set forth in Annex 18; FDJ may communicate such
information to ticket printers, provided that such printers
undertake in writing to maintain the confidentiality of such
information.
e) SGI obligates itself to do all that it is possible to assist
FDJ to install onto the System, before the beginning of the
Pilot Phase, the PATROL of BMC, CFT of SOPRA and/or TOM of
STERLING, in accordance with the provisions of Section 1.5 of
Annex 3. This assistance shall be free of charge, provided
that FDJ carries out the installation for the Software and
that they do not impede the proper functioning of the System
in accordance with the planning in Annex 4.
FDJ shall procure the usage licenses directly from the editors.
During the final acceptance of the System, if SGI has not shown
evidence that the Software disturbs the proper functioning of the
System, the Software shall be considered to be compatible with the
System and thus approved by SGI.
Consequently, SGI will no longer be able to invoke the presence or the
use of the Software as a reason for the non-compliance with SGI's
commitments appearing in this Agreement.
5. FUNCTIONAL INTEGRITY AND LEGAL UNITY OF THE SYSTEM
The computer system as defined above shall constitute a functional whole (unit
fonctionnelle) and a whole for legal purposes (unite juridique).
Final acceptance shall apply to the functionality of the entire System with the
SciScan Terminals, in accordance with Section 27 of this Agreement.
FDJ would not have entered into this Agreement if SGI had not undertaken,
without exclusion, to perform all the services and deliver all the materials
provided for herein.
<PAGE> 12
6. SGI's APPOINTMENT AS PROJECT MANAGER (Maitre d'Oeuvre)
Under this Agreement, SGI shall be project manager (maitre d'oeuvre) with
respect to the operation for the owner (maitre d'ouvrage), FDJ.
In this respect, SGI shall be responsible for the technical direction of the
operation, and it shall manage and coordinate the activities of the various
persons or entities involved, control the functional assembly of SGI
deliverables in connection with the System and the SciScan Terminals, (including
the connection of hardware and the installation of the Software but without
installation of SciScan Terminals at Retailers, Agents and Pr6lo), and shall
assist FDJ in the acceptance of the works that FDJ is required to carry out for
the setting-up of its computer site, directly through the service providers of
FDYs choice.
In the event that FDJ provides its assistance to SGI with respect to the
performance hereof, those FDJ personnel connected with any such project, while
remaining under the administrative, legal and hierarchical control of FDJ, shall
be placed under the technical direction of SGI.
Taking account of SGI's expertise in its specialization, SGI shall act in a
advisory role to FDJ. Without limiting its obligations generally hereunder, it
shall, in particular, be obliged to alert FDJ to the use of any hardware,
software or technical solutions that it considers to be poorly adapted for FDJ's
needs or too onerous.
SGI shall supply the SciScan Terminals in accordance with the provisions of
Annex 19, so that such terminals can communicate on-line with the central system
in accordance with the conditions set forth in Annex 15, and within a schedule
compatible with the timeframes set forth in Annex 4, for no other costs than
those expressly provided herein and in Annex 19.
7. OBLIGATIONS OF FDJ
Such services and deliveries for which FDJ is liable under this Agreement are
specified in Annex 5 hereto.
FDJ shall collaborate with SGI for the purpose of the success of the project.
FDJ shall, for such purposes, supply to SGI all possible documents, information
and data within its possession or capabilities so as to enable SGI to fully
understand FDYs needs and to fully analyze and delineate the parameters of the
responsibilities assigned to it.
In addition, FDJ shall monitor the progress of the operation in designating a
permanent representative dedicated to SGI, regularly attending the progress
committee and in sharing its observations with SGI as a future user and as a
good manager of its assets.
<PAGE> 13
FDJ shall purchase SciScan Terminals from SGI under the conditions of Annex 19,
and install such SciScan Terminals.
FDJ shall be liable for the training of the Retailers with respect to the use of
the SciScan Terminals.
8. THE REPRESENTATIVES OF THE PARTIES
The surname and first name of the representative who shall be responsible for
the performance of this Agreement on behalf of SGI is set forth in Annex 10.
Such representative shall be responsible for the progress of the agreed
operations, shall represent SGI, and shall be the authorized representative
(correspondant attitre) of SGI at FDJ.
In the absence of a major unforeseen contingency such as departure from the
company or illness etc., SGI shall keep the same correspondent for the
performance of this Agreement.
In the event of a change in correspondent, SGI shall ensure that such change of
personnel does not interrupt the duties incumbent upon it.
SGI shall inform FDJ of any such change as soon as possible and shall
communicate to FDJ the surname and first name of the new representative.
FDJ hereby designates its authorized representative (correspondant attitre) with
respect to SGI as set forth in Annex 10.
9. PROGRESS COMMITTEE
A progress committee is hereby created to oversee the operation, the composition
of which is set forth in Annex 10 hereto.
Each party shall indicate to the other by separate letter, the surname, first
name and position of the person it respectively designates to have a seat on the
progress committee.
Such committee shall be presided over by the qualified representative of FDJ
(hereafter, the "Chairman"). The parties hereto shall be entitled to invite any
person it deems useful to attend any committee meeting.
9.1 Duties
The progress committee shall:
<PAGE> 14
inform itself of reports provided in respect of activities established by the
project manager for each meeting and all information concerning the
implementation and functionality of the System;
- follow the progress and the quality of various works;
- for information purposes, collectively examine technical
choices made, SGI retaining approval rights over technical
performance of the project;
- inform itself about human resources applied by SGI, in
particular, if applicable, in the event of SGI making up for
lost time;
- monitor the proper performance of this Agreement, including,
but not limited to the exchange of letters for the purpose of
agreeing to specific provisions and the observations of
deadlines; and
examine, in the first instance, disputes arising out of the
performance of this Agreement.
In no event shall the progress committee, by decision, modify any contractual
document, an amendment hereto being required for such purposes, or incur any
expense for the account of FDJ.
9.2 Meetings And Reports
The Chairman shall convene the committee every month on a fixed date and at any
other time he deems necessary; he shall establish an agenda in liaison with the
SGI representative.
The Chairman shall prepare draft reports of each meeting, a copy of which he
shall provide to the SGI representative as soon as possible. Each draft report
shall be submitted for the approval of each of the parties hereto at the
following meeting.
A register of definitive reports destined for the Chairman shall be kept under
his responsibility. FDJ shall be entitled to consult, make and distribute copies
of the same.
10. AUDITS
FDJ shall have the right to carry out, or to have carried out on its behalf, at
its expense and by a professional of its choice bound by confidentiality
obligations, an audit of the services provided and of the means of
implementation, in particular in the case of lateness or default in deliveries
by SGI.
Any such audit shall have been previously brought to the attention of SGI and
shall be agreed as to, inter alia, date, duration and purpose, so as to disrupt
as little as possible the activities of SGI.
<PAGE> 15
FDJ shall, if it considers it appropriate, communicate the results of such
audits to SGI.
Such audits shall be confidential and may only be communicated to the parties
hereto or to the arbitration authorities.
MODIFICATIONS TO THE SPECIFICATIONS OF THE SYSTEM
If, at any time during the performance of this Agreement and prior to the final
acceptance of the System, FDJ wishes to carry out a functional modification of
the specifications of the System, it shall inform SGI in writing thereof,
setting forth its request in detail.
Upon the receipt of such request, SGI shall have a period of twenty (20) days in
which to respond to FDJ, indicating whether such request is feasible.
If any such request is not feasible, SGI shall give reasons therefor in its
response.
If any such request is feasible, SGI shall communicate and provide reasons to
FDJ for any additional charges and modifications to schedules linked to such
change to the specifications of the System within ten (10) business days.
Upon receipt of SGI's response, FDJ shall have ten (10) days in which to either
accept or reject SGI's new offer.
If FDJ accepts SGI's offer, the parties hereto shall sign an amendment to this
Agreement, formalizing the implications of any such new offer with respect to
this Agreement.
In the event that SGI does not respond within thirty five (35) days following
receipt, by way of notification, of a request by FDJ for modifications to the
specifications of the System, indicating the deadline to answer, the
consequences of failure to respond and making specific reference to Section I I
of this Agreement, such request from FDJ shall be deemed accepted by SGI,
without modification of the price and/or the performance schedule of the
Agreement.
12. GENERAL SCHEDULE FOR DELIVERY OF THE SYSTEM
The System shall be placed in operation in accordance with the delivery schedule
set forth in Annex 4 hereto, indicating the dates provided for the delivery of
the various deliverables and the carrying out of the various services.
<PAGE> 16
13. SALE OF HARDWARE
Subject to and in accordance with the terms and conditions set forth herein, SGI
sells to FDJ, who buys the same, the new hardware set forth in Annex 2 hereto.
As provided for hereafter, SGI shall deliver, transport, install, enable and
test such hardware.
14. SET-UP AND ENVIRONMENT
Except as may be specifically agreed with respect to light equipment, prior to
the delivery of the hardware, FDJ shall carry out at its expense and under the
technical supervision and consultation of SGI, the facility preparation works in
accordance with the technical specifications of the hardware to be received.
Prior to commencing such works, the parties hereto shall have established by
common agreement, the plans and performance programs.
SGI shall indicate to FDJ the electrical and secured installations to be carried
out, connection cables to be installed and work stations to be set up etc.
FDJ shall be responsible for the choice and supply of the communications network
to be used with the System. SGI guarantees that the System shall be compatible
with the telecommunication network used by FDJ and described in Annex 15.
FDJ will be responsible for the preparation of points of sale at which SciScan
Terminals shall be installed.
15. TRANSPORT
I Transport shall be carried out in accordance with DDP Incoterm.
16. DELIVERY
SGI shall deliver the System and its Sub-Systems subject to and in accordance
with the schedule and locations set forth in Annex 4 of this Agreement.
Where transportation is carried out by the hardware manufacturers or by a
professional transporter, SGI shall be present at the delivery and shall sign
the delivery receipt presented to the same and shall specify, where applicable,
such reservations that it considers necessary.
<PAGE> 17
17. INSTALLATION
SGI shall be liable for installation of the System. Notwithstanding the
foregoing, FDJ shall be liable for the installation of SciScan Terminals in
Retailer outlets and any other location where these terminals shall be used.
Before the delivery, FDJ and SGI shall agree on the date and hour of the
installation in accordance with the timeframe set forth in Annex 4.
18. EFFECTIVE DATE OF AGREEMENT
This Agreement shall take effect as of the date of signature thereof by the
parties and delivery to FDJ by SGI of the performance bond indicated in Section
21 and in the form set out in Annex 12 as annexed hereto or in such other form
as may be approved by FDJ.
19. PRICE AND CURRENCY
19.1 Price
IR consideration of the deliveries and services provided for herein, FDJ shall
pay to SGI the sum as provided for in Annex 7 of this Agreement in accordance
with Delivered Duty Paid (DDP) free of all taxes and duties to FDJ's site at
Vitrolles, France.
In the event of contradiction between the Incoterm. DDP and the terms of this
Agreement, the parties agree that the terms of this Agreement shall control.
Such sum shall be paid in accordance with the payment schedule set forth in
Annex 7 of this Agreement.
I
19.2 Currency
For all purposes and in accordance with the principles of monetary laws, it is
hereby acknowledged that amounts payable in French Franc under this Agreement
shall be deemed denominated and/or payable in European currency, when the French
Franc is no longer the lawful currency or, more generally, is replaced by the
European currency in accordance with applicable European and/or French
regulations. The rates used to convert the French Franc at such time shall be
those provided pursuant to article 109L of the Treaty on the European Union.
20. INVOICES
Any invoice issued pursuant to this Agreement is required to be addressed by SGI
in two (2) originals to FDJ's General Accounts Department (service de la
compabilite generale),
<PAGE> 18
Domaine des Gueules Cassees, Mousy-le-Vieux (77 230) accompanied with the bank
account and identification details (releve d'idente bancaire) to which SGI
wishes the wire transfer to be made.
Payment shall be made by wire transfer on the 1st of the month following a
period of thirty (30) days from the date of receipt of the invoice and the
banking coordinates.
General terms and conditions of sale or purchase set forth in documents sent by
either of the parties to each other shall not apply to this Agreement.
21. PERFORMANCE BOND
SGI shall, for the purposes of the ensuring the performance of its contractual
obligations under this Agreement, submit to FDJ a performance bond fifteen (15)
business days following the signature of this Agreement.
The said performance bond, in such form as set forth in Annex 12, may be called
in by FDJ, to the level of the guaranteed sum, with respect to any and all sums
for which SGI becomes a debtor, by arbitration decision, following the
non-performance of its contractual obligations.
The bank guarantee or performance bond shall terminate on the date of final
acceptance of the System and shall be for a sum of (Ten Million Francs) FRF
10,000,000 or its equivalent in dollars (USD) at the issue date thereof.
22. TRANSFER OF TITLE AND RISK
Subject to payment of the price, transfer of title and risk shall pass to FDJ in
accordance with DDP Incoterm.
23. LICENSE FOR THE USE OF THE SOFTWARE
Subject to the provisions of this Section, including Section 23.2, SGI hereby
grants to FDJ a non-exclusive, non-transferable right to use the Software
subject to and in accordance with the functionality and performance criteria
described in Annex I with respect to the equipment described in Annex 2.
23.1 Ownership Of The Software
SGI warrants that it is either the owner of the Software, or holds such
necessary rights in and to the Software, so as to enable it to grant to FDJ the
present Software license herein. FDJ
<PAGE> 19
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
agrees to comply with the conditions relating to sub-licenses for the use of
Oracle and Digital software set forth in Annex 13 and execute the agreements set
forth in such Annex.
The Software and all the elements included in it, the documentation related to
the Software, and all the adaptations, modifications, evolutions, updating and
future new versions related to the Software are the sole property of SGI. Any
adaptation or modification specific to the Software made upon FDJ's request
shall remain the sole property of SGI, unless otherwise provided by express
prior written agreement between FDJ and SGI.
FDJ expressly acknowledges that no intellectual property right or right on the
related documentation other than the right to use the Software granted hereunder
shall be licensed to FDJ. FDJ also acknowledges that the Software and the
documentation related to the software are "ceuvres de l'esprit" protected by the
regulation and international conventions in force, including the law of March
11, 1957, as amended by the law of July 3, 1985.
In order to ensure the protection of the rights of SGI and third party licensers
in connection with the Software exploited by virtue hereof, FDJ shall, in
particular:
0 clearly display ownership and copyright notices that SGI has affixed to
programs, supports or documentation associated with the Software, except
with respect to interfaces accessible to those playing FDJ games; in case of
seizure, FDJ shall defend against this seizure, within the limits of its
possibilities, and shall take reasonable measures so that the rights of FDJ
are known and respected; FDJ shall inform SGI of such seizure;
* take the necessary measures so as to ensure protection and safety of the
Software;
take all such reasonable steps with regard to its personnel, Agents and
Retailers and all applicable third parties, to inform and prevent any
unauthorized copy or use of the Software; and
ensure when possible (i) in all circumstances, the confidentiality of the
Software and (ii) prevention of disclosure communication of the Software to
third parties;
generally, to promptly alert SGI of any infringement or act that diminishes its
rights referred to in this Section that FDJ becomes aware of.
23.2 Extent Of Usage Rights
The Software shall be used only to the extent of the conditions defined
hereunder.
FDJ shall use the Software exclusively on its central sites with respect to
games marketed by FDJ.
In accordance with the provisions of Section 1.2.1. of Annex 7, the additional
usage rights conferred under this Agreement are for [*] SciScan Terminals.
The additional usage
<PAGE> 20
rights for the deployment of the SciScan Terminals may be acquired by FDJ in
return for a payment of an additional fee, in accordance with Section 1.2.2. of
Annex 7. In the event that FDJ wishes to relocate the central site Software or
to install other copies of such Software on multiple hardware equipment linked
on the same site or distributed on a number of FDJ sites, FDJ shall obtain SGI's
prior consent for such relocation as long as SGI is in charge of the maintenance
and/or operation of the System, such consent for which shall not be unreasonably
withheld.
The Software may be utilized in any place where FDJ distributes and/or
commercializes its Tickets and products provided that the Software is intended
exclusively for the internal use of FDJ, Prdlo, its Agents, Retailers and,
generally, any person or entity distributing and/or commercializing its Tickets
and products.
Any extension of the intended use of the Software as defined above shall be
required to form the subject of an amendment hereto, specifying, in particular,
the financial terms.
Except as provided in the following paragraph, the right to use the Software
granted to FDJ is non-assignable and not sub-licensable, and FDJ is prohibited
from transferring the same to any third party, even gratuitously.
The Parties agree that for the purposes of this Agreement, Agents, Pr6lo,
Retailers and, generally, any person or entity distributing and/or
commercializing FDYs Tickets and products, shall be accorded usage rights of the
Software allowing them to use SciScan Terminals, solely in their capacity as end
user.
Pursuant to this Agreement, FDJ shall not:
modify, decompile, disassemble, alter or decode the Software;
access to use, modify or alter the source code unless otherwise provided in
Sections 3.1, 23.4, 24 and in Annex 3.
- - duplicate the Software and the documentation related to it; notwithstanding
the foregoing, FDJ shall have the right to duplicate the documentation and the
Software, for purposes of its day-to-day operation and for back-up purposes.
These back-up copies shall be held on FDJ's site and SGI shall have access to
such copies in order to verify that there exists the same references to those
mentioned on the original copy, and that such copies have not been modified,
altered, decoded, decompiled or disassembled; Any other duplication of the
Software shall be subject to another license to use.
FDJ shall take the necessary measures in order to ensure that its personnel
respect these obligations.
23.3 Delivery And Installation
SGI shall deliver to FDJ the Software comprised of their "object-code" versions
which shall be directly computer readable by the equipment listed in Annex 2, 4
copies of installation
<PAGE> 21
manuals in the French language or the English language if the French version is
unavailable, even if installation is performed by SGI, user manuals and the
operating procedures.
Installation manuals and end user manuals may be delivered in CD-ROM format.
23.4 Interoperability
SGI shall supply in a reasonable way all accessible information to FDJ necessary
for the purposes of interoperability as provided for in article L. 122-6-1-IV of
the Code de la Propriete Intellectuelle with respect to rights to the Software
granted together with other software used by FDJ.
To this effect, SGI undertakes to communicate to FDJ the necessary information
(including the necessary source codes for Terminal SciScan) to achieve
interoperability of the SciScan Terminal software with new systems of FDJ.
23.5 Term Of Grant Of Use Rights
The grant of usage rights of the software shall be for the full period of
copyright protection in and to the Software.
24. USE OF SOURCE CODE
Prior to the operation of the System, SGI shall, at its sole expense, register
the Software source code delivered and developed by SGI hereunder at Logitas SA,
SILIC 157 - 38 place de Seine, 94533 Rungis Cedex, or any other company mutually
agreed with FDL For such purposes, Logitas shall deliver to FDJ a confirmation
receipt of such registration. SGI shall also ensure the registration of software
tools permitting the reconstruction of the object code from the source code (if
FDJ does not possess such tools), and updated versions of the Software used and
in respect of which, it shall obtain a receipt prior to any use thereof.
Source code with respect to the Software shall be registered in both
"object-code" and "source-code" form as well as all technical documentation. A
copy of the deposit certificate shall be furnished to FDJ following the
definitive acceptance of the System together with the documents permitting it to
access such registration.
In accordance with the regulations of Logitas and the agreement which will be
entered into with such company, FDJ may have access to source code programs
under the supervision of Logitas in the following circumstances:
seizure or breakdown in the functioning of any of the Software during the
guarantee or maintenance period where such breakdown has not been repaired
within the time limits set forth in this Agreement from the date of notification
thereof to SGI;
<PAGE> 22
bankruptcy or judicial winding-up of SGI without there having been any
resumption of the obligations by the latter with respect to the licensor company
within one month of the judgment date ruling on the bankruptcy or winding-up;
- non-supply by SGI of necessary information to achieve interoperability
(protocol interface) of the Software with other programs
notwithstanding the undertaking by SGI to supply the same; and
- exercise of the option for the transfer of know-how set forth in Annex
14; the delivery of the source code shall take place upon payment in
full of the price for the transfer of know-how and the execution of an
agreement for this option.
FDJ may only use such source code and its documentation subject to the rights
granted with respect to the use of the copies in "object" code. Access to source
programs does not transfer any other right.
In the event of termination of this Agreement by FDJ (with or without
retroactive effect), LOGISTAS shall deliver the source code to SGI.
The Parties agree that the source code of the Software registered with Logitas
is confidential in accordance with the provisions of Section 39.
I
25. LATE PENALTIES
In the event that SGI fails to timely comply with its obligations under this
Agreement within the milestone deadlines (hereafter each, a "Milestone
Deadline") defined in Annex 4 for such obligations, FDJ shall be entitled to
impose late penalties.
In the event that FDJ decides to impose late penalties upon SGI, such penalties
shall run from the end of the fifth business day following the day that an
element of the System was due to be delivered in a state allowing to proceed
with its acceptance in accordance with the applicable Milestone Deadline.
The formula applicable with respect to the calculation of penalties incurred is
as follows:
P=VxR
1000
The letters indicated in the above formula correspond to the following:
P amount of applicable penalties before taxes;
R number of calendar days late with an exemption of five (5) working
days; and
V : value of element(s) late.
<PAGE> 23
Penalties payable may be set-off against current or future SGI invoices. In the
event that SGI makes up for late obligations under this Agreement, retained
penalties shall be returned.
Aggregate late penalties shall be capped at twenty-five percent (25%) of the
total price of the System.
After 90 days delay with respect to one of the deadline dates in the performance
schedule, FDJ may terminate this Agreement subject to and in accordance with
terms and conditions set forth in Section 36.
SGI shall not be required to pay penalties if it can show that the delay in
question is imputable to an event of force majeure or imputable to FDJ.
Any delay imputable to FDJ shall have the effect of extending such deadlines
applicable to SGI for a period not to exceed such delay. In addition, SGI shall
be entitled to invoice FDJ for a compensatory indemnity equal to its real costs
(with supporting evidence) incurred due to such delay.
The penalties applicable to SGI resulting, directly or indirectly, in liability
for delay or nonconforming delivery of SciScan Terminals are defined and limited
to those described in the Supply Agreement attached as Annex 19.
26. CONTINUING FUNCTIONALITY OF THE SYSTEM
SGI shall ensure that the Software supplied under this Agreement shall continue
to function correctly (in a technically equivalent environment) without any
additional cost to FDJ and without any deterioration in the performance,
availability or security thereof, at the time that the French Franc no longer is
legal tender or, more generally, when it is replaced by a single European
currency in accordance with applicable European Community and/or national
regulations.
Furthermore, SGI shall ensure that the System supplied under this Agreement,
and, in particular, its Software shall continue to function correctly, without
any additional cost to FDJ and without any deterioration in the performance,
availability or security thereof during and after the year 2000.
SGI undertakes to propose to FDJ for a reasonable price new developments to the
System which might be necessary upon the changing of FDJ's central site from
which FDJ operates on-line games.
<PAGE> 24
27. ACCEPTANCE OF PHASES AND THE SYSTEM
Each Phase shall form the subject of a provisional and final acceptance. The
System shall thereafter form the subject of an overall provisional and final
acceptance.
27.1 Establishment Of An Acceptance Procedure
FDJ shall supply, within twenty (20) business days from the signature of this
Agreement by the parties hereto, the standard acceptance form. Such standard
form shall permit SGI to prepare a completed draft acceptance form, which must
be supplied to FDJ within ninety (90) calendar days from the date of receipt by
SGI of the standard acceptance form.
The parties shall have a period of fifteen (15) business days following the
notification to FDJ of the completed draft acceptance form by SGI in order to
agree on the contents, approve the provisions and sign a copy thereof. The
completed acceptance form so signed and approved shall form an integral part of
this Agreement.
The parties hereto may envisage a mutual agreement as to complementary tests
that may have been omitted at the time of the establishment of the completed
acceptance form.
The level of tests envisaged may not exceed the the specifications of the System
described in Annex 1.
If the parties hereto are unable to agree upon the contents of the completed
acceptance form prior to the expiration of the time-limits provided for above,
either of the parties hereto may terminate this Agreement, the consequences
thereof being set forth in Section 36.2.
27.2 Method Of Acceptance
For the acceptance of each Phase and of the System, FDJ shall provide
infrastructure and human resources set forth in Annex 5.
SGI shall make available to FDJ all sets of trials and specific tools necessary
for the performance of acceptance testing.
The principal coordinator and his assistant appointed to represent each of the
parties are identified in Annex 10. These representatives of the parties have
the power to make decisions and bind the party that each represents, in
particular, for the purposes of carrying the set of technical and functionality
trials, and to individually sign all minutes of acceptances, with or without
reservations.
<PAGE> 25
27.3 Acceptance Procedure
Each acceptance shall be carried out in FDJ's premises in two (2) stages,
comprising a provisional acceptance and a final acceptance.
Each acceptance shall be made in the presence of both parties (contradictoire)
and shall be evidenced by the signature, by the Parties, of written minutes
thereof.
27.4 Provisional Acceptance
Provisional acceptance shall consist of passing final tests as set forth in the
completed acceptance form and the generation of a statement to that effect.
Provisional acceptance is required to take place with respect to each Phase
within a maximum of twenty (20) business days of the date of delivery by SGI of
the Sub-Systems related to each Phase.
27.5 Final Acceptance
(a) Final Acceptance With Respect to Each Phase
Final acceptance with respect to each Phase shall consist of re-passing tests
that were not conducted successfully at the time of and after provisional
acceptance and of passing nonregression tests. Final acceptance may take place
as soon as FDJ is able to determine that these bugs have been corrected and that
the Sub-Systems of each Phase have not regressed.
Final acceptance with respect to each Phase does not, in and of itself comprise
provisional or final acceptance of the System.
Following final acceptance of the Deployment Phase, provisional acceptance of
the System is proceeded to.
(b) Final Acceptance With Respect to the System
Final acceptance of the System shall consist in the verification of its
functionality at the end of the Deployment Phase with 95% of the SciScan
Terminals which are purchased by FDJ from SGI in accordance with Annex 19 and
which are subject to the Deployment Phase, installed and connected to the
central site, while ensuring that the Sub-Systems function without deterioration
in functionality and/or performance and that SGI has completed all of its
contractual delivery obligations.
In the event that the final acceptance of the System has not occurred in
accordance with the schedule set forth in Annex 4 as a result of a material
failure of FDJ to comply with its obligations hereunder (including without
limitation its obligations to install SciScan Terminals during the Deployment
Phase to perform acceptance testing), then:
<PAGE> 26
(i) the final acceptance shall be deemed to have taken place on the
date set forth in Annex 4, provided that the System has operated properly for a
period of thirty (30) days with 85% of the SciScan Terminals to be installed
during the Deployment Phase; or
(ii) the deadline of the final acceptance shall be deferred until the
end of a period of six months from the date on which the final acceptance was
originally scheduled if the System has operated properly for a period of thirty
(30) days with less than 85% of the SciScan Terminals to be installed during the
Deployment Phase. FDJ shall nevertheless pay to SGI the installment of the price
due in accordance with Annex 7, on the date on which the final acceptance was
originally scheduled. If the final acceptance has not taken place within this
additional 6-month period, with a proper functioning of the System confirmed for
a period of thirty (30) days with 95% of the SciScan Terminals, but without
FDJ's material failure hereunder, SGI shall repay to FDJ the amount of the
installment referred to above, and the provisions of Section 27.6 shall apply.
Notwithstanding the foregoing, in the absence of written reservation or
objections by FDJ, the final acceptance of the System shall be deemed to have
occurred upon the earlier to occur of: (i) the proper functioning of the System
confirmed for a period of thirty (30) days with 95% of the SciScan Terminals
purchased by FDJ from SGI which are subject to the Deployment Phase, or (ii) the
end of the warranty period.
27.6 Events Affecting Acceptance
In the event that:
provisional acceptance of a Phase is not confirmed due to the action of FDJ
within the planned periods provided for; or
provisional acceptance of the System is not confirmed due to the action of FDJ
within the planned periods provided for;
SGI shall give notice to FDJ requiring it to agree to the acceptance in question
within fifteen (15) business days from the date at which the acceptance
in-question was supposed to take place.
FDJ shall respond to such notice within fifteen (15) business days from the date
of receipt thereof by certified mail with return receipt requested, indicating
either its acceptance or its refusal giving reasons therefor.
In the absence of either a response from FDJ or the absence of acceptance due to
FDJ, acceptance shall be deemed automatically to have taken place after the
first to occur of: (i) a period of thirty (30) days of confirmed proper
functioning of the System with 95% of the SciScan Terminals purchased and
installed by FDJ which are subject to the Deployment Phase, or (ii) the end of
the warranty period.
In the event of refusal by FDJ of any acceptance due to breach by SGI, SGI shall
proceed, within a maximum of thirty (30) business days of such refusal of the
acceptance in question,
<PAGE> 27
to prepare the relevant elements of the Phase or the System for a second
acceptance test by FDJ.
In the event of failure of the second attempt at acceptance, FDJ may proceed to
a new acceptance by agreement with SGI or commence a period of negotiation of
fifteen (15) days subject to the following conditions:
- The period of negotiation shall commence as of the date of
notification of refusal by FDJ;
- SGI shall offer to FDJ all or part of the System in place and
an adjustment of the price of the System.
Changes relating to the acceptance criteria, to the list of System elements, to
dates, to the price or to other terms and conditions, in addition to the
agreement relating to the completed acceptance form relating to such elements,
shall be formalized by the signature of an amendment to this Agreement at the
end of the period of negotiation.
If the parties are unable to reach agreement during the period of negotiations,
FDJ shall be entitled to rely upon the provisions of Section 36 of this
Agreement.
27.7 Performance Requirements
SGI shall deliver a System that conforms, in both the final acceptance of the
System and in the constant technical environment as of the date of provisional
acceptance, with the performance obligations set forth in Annex 9.
In the event of non-performance at the time of final acceptance of the System,
the parties shall establish a diagnostic procedure within twenty (20) days
thereof.
The said performance requirements are considered to be mandatory and absolute by
FDJ who would not have entered into Agreement with SGI had SGI not undertaken
and agreed to ensure compliance with the same. FDJ may not, without cause,
refuse any suggestions made by SGI which would enable it to comply with such
performance requirements at fixed cost and in accordance with consistent
functionalities.
In the event that FDJ determines that the performance requirements have not been
met, it shall notify SGI by telephone, such notice to be confirmed in writing by
post.
SGI shall be accordingly required, until the final acceptance of the System, to
remedy any shortcomings in the performance by reference to Annex 9, in an
equivalent technical environment within a period of sixty (60) business days
from the date of sending by FDJ to SGI of a facsimile, to be confirmed by post,
notifying it of any such shortcoming.
In the event that SGI has not, through its own fault, remedied the deterioration
in performance under the conditions described above, FDJ hereby reserves the
right, at its option, to apply the
<PAGE> 28
provisions set forth in Section 36 or to negotiate a price reduction to be
accepted by each party.
At the end of the guarantee period of the System, FDJ may enter into a
maintenance agreement conforming to the services described in Section 29.
28. WARRANTY
28.1 Organization Of Relations Between FDJ And SGI For The Warranty Of
Hardware And Software Relating To The System
(a) Intervention requests by FDJ
These shall be notified to the extent they are required. In the event
of an emergency, they may be transmitted by facsimile. Information relating to
date/hour shall be recorded.
(b) Registered receipt of assistance requests
For each intervention request, a registered receipt shall be
automatically and promptly sent to FDJ which shall include relevant date and
time information.
(c) Statements supplied at the end of assistance
For each intervention, SGI shall furnish a statement of its intervention
describing:
- the incident;
- the diagnosis set out by SGI;
- the service(s) carried out under the warranty;
- the actions to take to remedy the incident.
I
In return, FDJ shall communicate in writing to SGI the period of the
total unavailability of the System due to this incident.
Statements shall be sent to FDJ by facsimile. In the event of
emergency, they may be made by telephone, confirmed by facsimile.
(d) Available times for assistance requests
From Monday to Friday between 8 am to 6 pm (Paris time).
(e) Timetable for assistance
The response time for SGI is defined as the period between the time of
receipt of the assistance request (indicated by the receipt of the facsimile of
the transmission carried out by FDJ) and the time on which SGI has fulfilled its
obligations in accordance with Section 28.2 and Section 28.3 (indicated by the
statement of the completion assistance sent to FDJ).
<PAGE> 29
28.2 Warranty In Respect Of Hardware
The hardware supplied by SGI under this Agreement shall be guaranteed against
all defects in manufacture or installation for a period of a warranty usually
given by manufacturers of such hardware, which shall commence on the later of
(i) placement in service or (ii) the date of final acceptance of the Pilot
Phase.
In addition to the warranty against hidden defects provided for in Article 1641
of the Civil Code, by which SGI is bound, SGI gives the contractual warranties
provided for below.
The warranty shall consist in the repair or exchange of the defective component,
in such manner that the hardware shall always be in an acceptable state of
functionality.
The exchanged piece need not be new, but must be fit for the purpose for which
it is destined. The repossessed piece shall become the property of SGI.
Replacement, labor and transport costs shall be borne by SGI.
SGI shall put into working order the defective hardware as follows:
- within four (4) business hours for hardware for the central
site set forth in Ann-x2-,
- within two (2) business days, for other materials provided by
SGI and described in Annex 2, following fax confirmation of a
telephone call to SGI during a business day.
In order to return hardware to working order, SGI may, depending on the
information given to it, either:
* give to FDJ, by telephone, a solution capable of remedying the breakdown or
fault;
I
* go on-site to proceed with the necessary repairs; or
decide upon any other solution which it considers appropriate to the
circumstances and in accordance with FDJ's technical environment.
The following are excluded from the warranty:
Breakdown or dysfunction due to improper use of hardware or non-compliance with
user or installation instructions;
Breakdown or dysfunction due to an external cause (knocks, breakages, accident,
humidity, water or other liquid damage, lightning, short-circuit, power supply
faults, acts of vandalism, theft or attempted theft, defective lines, etc.);
9 Normal wear and tear of hardware and its accessories;
<PAGE> 30
Breakdown or dysfunction caused by one or several modifications or add-ons made
to hardware without the written consent of SGI;
Damage due to failure to maintain in accordance with the user manual or lack of
surveillance or care;
- Damage resulting from repairs or maintenance carried out by
non-SGI approved persons;
- Breakdown or damage caused by the use of consurnables other
than those recommended by SGI. (In the absence of a
recommendation, FDJ shall be free of the choice of
consurnables).
- Deterioration following or due to insufficient packaging
and/or poor condition of equipment returned to SGI;
- Transmission breakdown (telecommunication network) including,
but not limited to, bad geographical coverage by
radio-electrical transmitters, interference linked to weather
conditions, or faulty telephone lines; and
lo Defects caused to hardware by the failure to respect normal environmental
conditions for such hardware.
Where the request for intervention addressed by FDJ is not attributable to a
deliverable made by SGI, (hardware, Software, etc.), SGI shall be entitled to
invoice in accordance with its rates in force at the time of intervention,
displacement costs not being included therein, after having demonstrated to FDJ
that the intervention is not attributable to a deliverable delivered or accepted
by SGI.
28.3 Software Warranty
I
SGI gives to FDJ, in addition to the warranty in respect of hidden defects
provided for in Article 1641 of the Civil Code, the contractual warranty of the
Software provided for below, for a period of twelve (12) months, which shall
commence on the earlier of the two dates which are: (i) 90 days after the date
of final acceptance of the Pilot Phase; or (ii) the final acceptance of the
Field Test.
With respect to the contractual warranty, SGI shall, at no cost, correct any
anomalies, abnormal incidents, effors, Software faults which arise through
normal use (hereafter referred to as "Faults") and which are reproducible in a
test environment or for which enough information shall be available to SGI to
repair the Fault.
Faults mean any and all differences between results effectively obtained and the
functionality and specifications set forth in Annex 1 and in the Software's
documentation.
As soon as FDJ considers there to be a software fault, the same shall be entered
upon a register, provided for such purposes, describing in as great a detail as
possible the conditions
<PAGE> 31
under which it appeared and its consequences, FDJ informing SGI as soon as
possible by telephone, if necessary, and confirmed by fax.
Depending upon the information received and the detail contained therein, SGI
may either:
- give to FDJ, by telephone, a solution capable of remedying the
breakdown or Fault;
- go on-site to proceed with the necessary analysis of the Fault
and correction; or
- decide upon any other solution which it considers appropriate
to the circumstances.
Incidents subject to this Software warranty shall be divided into three
categories:
(1) Block incidents:
An anomaly shall be deemed to be a block when it results in the complete
impossibility to employ an application or a functionality, or blocks more than
5% of the Terminals (engendering breakdown and a cessation of service), and
correction is required in accordance with the following.
Taking account of the importance to FDJ of the correct functioning of the
System, in the event of a block incident, SGI shall be required to resolve the
technical problem within a maximum period of 4 hours from the assistance
request, and to supply either a final solution or a bypass solution. Any such
solutions must comply with the functionality of the Software. Subject to SGrs
prior approval, FDJ reserves the right to intervene in the event of a block
incident, with respect to the strategic portion of the System for the purposes
of supplying a bypass solution. In this case, SGI is still required to intervene
within the 4 hours from the time of assistance request so as to provide a
solution. Any intervention by FDJ shall not terminate the contractual warranties
made by SGI. FDJ will notify SGI of its intervention as soon as feasible.
If, owing to the exceptional nature of the block incident, SGI is not able to
resolve the technical problem within 4 hours, SGI shall use its best efforts to
provide a solution that conforms with the functionality of the Software as soon
as possible. In such event, if SGI shows proof that it has used its best
efforts, then it may resolve the technical problem within a maximum period of 4
hours. If FDJ does not acknowledge that the incident is of an exceptional
nature, SGI shall be entitled to apply the arbitration procedure described in
Section 49.2 in order to determine whether or not the incident was exceptional.
(2) Non-Block incidents of non-conformity:
Where the result is false, incomplete and/or not in conformity with the
specifications of the Software, but not constituting a block, correction is
required within 15 days from the assistance request from FDJ.
(3) Other Non-Block incidents:
<PAGE> 32
For other Non-Block incidents, a solution must be provided by SGI within 45 days
from the date of an assistance request from FDJ.
Whatever their nature, SGI shall employ all useful and necessary means so as to
resolve technical problems encountered by FDJ and which are within the
provisions of the warranty. Such obligation shall include, in particular, the
implementation of appropriate technical solutions, the use of qualified and
competent personnel and rapid execution.
SGI shall be entitled to withdraw its warranty:
- if without the prior express approval of SGI, FDJ modifies the
Software;
- if without the prior express approval of SGI, FDJ modifies the
configuration of the Software and/or the hardware of the
System; or
as long as the equipment required for the use of the Software is
unavailable, provided that such unavailability does not result from a
breach of SGI hereunder.
Where the request for intervention addressed by FDJ is not attributable to a
deliverable delivered or accepted by SGI, (hardware, Software, etc.), SGI shall
be entitled to invoice in accordance with its rates in force at the time of
intervention, displacement costs not being included therein.
28.4 Penalties
In the event of total unavailability of the System of more than 0.05% per year,
FDJ shall have the right to claim penalties from SGI in the amount or 7000 FF
(excluding taxes) per hour for the hours exceeding the authorized annual rate of
unavailability.
The unavailability is defined as a period included between the time of issuance
of the request for intervention made by FDJ and the time from which all users
can again use the entire System.
In this case, the penalties shall be capped at a total amount of the first year
of annual hardware and software maintenance.
28.5 Infringement
SGI guarantees to FDJ that the rights granted under the license provided in
Section 23 do not infringe any intellectual property rights under the French
Intellectual Property Code.
For purposes of this guarantee, SGI shall conduct the defense of FDJ in
cooperation with the latter and in respect thereof, SGI shall be liable for
litigation costs, legal and expert fees and damages together with interest
arising from any definitive and non-appealable decision holding that FDJ
infringes intellectual property rights. SGI shall also offer to substitute any
infringing element, without interrupting service of the System.
<PAGE> 33
It is acknowledged and agreed that the selection of counsel by SGI shall be
subject to the prior agreement of FDJ.
FDJ undertakes to promptly notify SGI in writing of any infringement claims as
soon as FDJ becomes aware of any such claim.
29. SOFTWARE MAINTENANCE
Upon the end of the warranty, SGI and FDJ shall conclude a corrective and
evolving maintenance agreement for a period of five (5) years, which may be
terminated each year by FDJ on the anniversary date of the commencement date of
the maintenance, provided that FDJ respects a 6-month prior notice, such
agreement to incorporate and be subject to the terms, conditions and methods set
forth in Annex 8.
The fee proposed by SGI for maintenance of each portion of the Software shall
conform to the price set forth in Annex 7. Such fee shall be indexed-linked, as
of the end of the first year of maintenance, to the SYNTEC index by application
of the adjustment formula set forth in Annex 7.
Update maintenance shall include the supply of new versions of the Software. FDJ
shall have no obligation to install such new versions. SGI shall be required to
ensure the maintenance of versions N, N-1 and N-2, version N being the SGI
reference version. New versions shall be limited to one (1) per year.
Notwithstanding the foregoing, the updates carried out by SGI, or by FDJ by
agreement with SGI, shall not affect the functionalities of the System,
contractual guarantee or performance requirements due from SGI pursuant to the
terms of this Agreement. If this is not the case, SGI shall be required to
inform FDJ and obtain its consent, prior to carrying out updates, of the
consequences that updates will have upon functionalities, and/or performance,
and/or the guarantee.
FDJ is not required to elect hardware or DEC/ORACLE Software maintenance from
SGI in order to benefit from Software maintenance from SGI, as long as the
hardware and Software is maintained in accordance with state of the art
requirements.
30. HARDWARE MAINTENANCE
Upon the end of the warranty, SGI and FDJ shall conclude a hardware maintenance
agreement described in Annex 2 for a period of six (6) years, which may be
terminated by FDJ each year by FDJ on the anniversary date of the commencement
date of the maintenance, provided that FDJ respects a 6-month prior notice, such
agreement to incorporate and be subject to the terms, conditions and methods set
forth in Annex 8.
<PAGE> 34
The fee proposed by SGI for maintenance of each portion of the hardware shall
conform to the price set forth in Annex 7. Such fee shall be indexed-linked as
of the end of the first year of maintenance, in accordance with the indexation
clauses of the hardware suppliers, to the SYNTEC index by application of the
adjustment formula set forth in Annex 7.
The price of detached hardware components listed in Annex 2 is set forth in
Annex 7.
FDJ is not required to elect Software maintenance from SGI in order to benefit
from System Hardware maintenance from SGI, as long as the Software is maintained
in accordance with state of the art requirements.
31. LIABILITY
31.1. Liability
SGI shall perform the obligations undertaken by it under this Agreement subject
to and in accordance with professional standards prevailing in the computer
industry and all applicable regulations, and, in particular, with the Labor Code
(Code du Travail) and the Intellectual Property Code (Code de la Propriete
Intellectuelle). FDJ shall be solely liable with respect to regulations
specifically applicable to FDJ's activities.
To the extent that, due to the performance or non-performance of the obligations
under this Agreement, FDJ is able to show that it has suffered a loss, it shall,
where there has been proven default by SGI, be entitled to claim damages subject
to the provisions set forth below in the Section entitled "Limitation of
liability".
31.2. Limitation of liability
I
SGI's liability in respect of proven breaches under this Agreement shall be
limited to the total price of the System.
SGI shall, in no event, be liable for a loss due to the non-performance by FDJ
of all or part of its obligations as set forth in this Agreement.
The limitation of liability shall not apply in respect of the matters set forth
in the Section entitled "Infringement". In addition, it shall not apply to
claims by third parties with respect to personal injury or property damage
(whether to chattels or property) for which SGI would be responsible as a matter
of law (droit commun).
The liability of SGI concerning the supply of SciScan Terminals is defined and
limited as set forth in the Supply Agreement for SciScan Terminals attached as
Annex 19.
<PAGE> 35
32. LIEN - COMPENSATION
Neither party is permitted to exercise any lien or right to compensation with
respect to the other party without having obtained either its authorization or
an enforceable arbitration order.
33. INSURANCE
SGI warrants that it has obtained insurance cover that is sufficient to cover
its professional liability, the same to be evidenced to FDJ upon demand.
34. PERSONNEL
Personnel that are engaged by SGI to work upon equipment, facilities and/or
sites of FDJ shall remain at all times in the employ of SGI, with regard to
which SGI shall bear all employer obligations in respect thereto. SGI shall
directly engage, manage and remunerate its own personnel and shall be solely
responsible for the management, discipline and the security of said personnel.
Where SGI is engaged on FDJ sites, SGI personnel shall be required to conform to
the "Interior Regulations" and to the security standards in force at FDJ
establishments where it carries out its engagements.
35. FORCE MAJEURE
The parties hereto shall not bear liability in respect of lateness or
non-performance of obligations under this Agreement caused by an event of force
majeure.
The expression "force majeure" means any event exterior to and not within the
control of the Parties that is unforeseeable and which prevents the performance
of the obligations under this Agreement, in whole or in part, or renders the
performance thereof excessively onerous or difficult for either one of the
Parties.
Events of force majeure are deemed to include, without limitation, the
following: natural disasters, acts of war, insurrection, strikes, governmental
edicts (including, without limitation, the repeal of statute or regulations
allowing the exploitation of games of chance in France) or the imposition of
taxes, if the latter has the effect of materially affecting the performance of
this Agreement.
It is expressly agreed that an event of force majeure shall result only in the
suspension of the obligations of either party under this Agreement only during
the period in which such event has effect. The Party seeking to rely on the
provisions hereof is required to notify the other Party subject to, and in
accordance with the provisions of this Section.
<PAGE> 36
Suspension of this Agreement may not, in any event, exceed three (3) months from
the date of receipt of the above-mentioned notice. At the expiration of said
period, the parties shall meet so as to mutually agree as to the termination of
this Agreement upon the basis of a payment made to SGI on a pro rata basis for
work done. In the absence of agreement, the most diligent party may demand
termination hereof by judicial means.
36. TERMINATION
36.1 Methods Of Termination (Resiliation Ou Resolution)
Where one of the parties hereto fails to perform any of its obligations under
this Agreement, the non-defaulting Party shall notify the defaulting Party to
remedy such non-performance by certified mail with return receipt requested.
if, within thirty (30) business days from the date of receipt of the certified
letter with return receipt requested, the defaulting Party has not remedied its
non-performance, the nondefaulting Party shall be entitled to terminate this
Agreement (resiliation) or unilaterally terminate this Agreement with
retroactive effect (risolution) in the circumstances provided for in Section
36.4 and without prejudice to the exercise of any other rights available to such
party.
36.2 Termination For Disagreement With Regard To The Acceptance
Form The inability of the parties to agree upon the completed acceptance form
shall result in the same consequences as set forth in Section 36-5.
1
36.3 Termination (Resilation Ou Resolution) For Failure (Echec)
With Respect To An Acceptance
In the event of failure with respect to the acceptance of one of the Phases
(including the Preliminary Phase) or the acceptance of the System, FDJ shall be
entitled, at its option, either to unilaterally terminate this Agreement with
retroactive effect (resolution) or terminate this Agreement (resiliation) with
SGI bearing all the legal consequences arising from such termination, provided
that after the final acceptance of the System, FDJ shall not be entitled to
terminate this Agreement with retroactive effect.
In the event that this Agreement is terminated with retroactive effect
hereunder, SGI shall repay to FDJ, sums hitherto paid by FDJ, and FDJ shall
deliver up to SGI all equipment and Software hitherto delivered.
36.5 FDJ's Right To Termination Without Cause
<PAGE> 37
FDJ may terminate this Agreement by written notice to SGI at any time and the
date of termination shall take effect from the date of receipt by SGI of such
notice.
In the event of such termination:
- all payments made by FDJ up to the date of termination shall
be retained by SGI;
- FDJ shall retain all elements in respect of which delivery has
been scheduled and actually made prior to the date of
termination;
- FDJ shall make payment in respect of all invoices issued up to
and including the date of termination and which have not been
paid at that date; and
- FDJ shall pay a pro rata portion of the immediately following
invoice due in the payment schedule set forth in Annex 7. The
pro rata payment shall be calculated taking account of the
number of days having elapsed from the commencement of the
payment period to the date of termination (the expression
"payment period" meaning the period of time separating two
consecutive dates indicated in the payment schedule).
SGI shall invoice FDJ for the entire cost born by SGI for the purposes of
performing its obligations under this Agreement, including, upon presentation of
justificatory evidence, in respect of sums which it was required to pay to third
parties due as a result of termination hereof as well as for all expenses
incurred resulting from the cessation of the project.
37. ASSIGNMENT
This Agreement is personal to SGI, which is accordingly expressly prohibited
from assigning any of its rights or obligations either in whole or in part to
any third party whatsoever without having previously obtained the written
consent of FDJ, such assignment of which cannot be refused by FDJ without
justification, which, in any event shall be made in conformity with the joint
venture agreement between FDJ and SGI.
FDJ may not legitimately refuse any such assignment, especially if it arises
from a purely internal SGI restructuring, and if the assignee company makes the
same undertakings and warranties to FDJ with respect to solvency, durability and
competence as SGI hereunder, and to the extent that performance of this
Agreement is not altered thereby.
For the purposes of this Section, any change in the majority-ownership of share
capital of SGI, any capital contribution, merger, absorption, and, generally any
corporate transaction aimed at or resulting in a change in the corporate
ownership of SGI (except within its group in the context of its current
restructuring) shall be deemed to constitute an assignment.
<PAGE> 38
38. SUB-CONTRACTING
SGI may use sub-contractors for the provision of certain services hereunder.
SGI warrants that with respect to its sub-contractors, it has obtained all such
necessary contractual undertakings so as to enable it to perform its obligations
under this Agreement.
SGI shall be directly liable for all of the acts and omissions of
sub-contractors, even where the same have been selected with the approval of
FDJ. SGI shall ensure that all of the obligations of the sub-contractors are
fully performed.
Sub-contracting hereunder shall be subject to the Law of December 31, 1975.
39. CONFIDENTIALITY
For the duration of this Agreement, the Parties may come into possession of
confidential technical, commercial or fiscal information.
Each of the Parties hereby undertakes that it shall, and shall procure that its
employees and all parties acting on their behalf, preserve the absolute
confidentiality of all technical data, information or advice that it may come
into possession of in either the negotiation, signature and performance phases
of this Agreement.
Information, concepts or techniques shall not, however, be deemed to be
confidential if-
- they are, at the time of their disclosure, either in the
public domain or have fallen into the public domain in the
absence of any breach of the terms of this Agreement;
- they are known to one or the other of the Parties without any
breach of the obligation of confidentiality hereunder; or
they have been received in a lawful manner by one or other of the
Parties from a third party without any obligation of confidentiality.
The Parties hereto agree that the terms of this Agreement are confidential.
In the event that one of the Parties shall be legally constrained to divulge any
of the confidential information, such party shall inform the other parties as
soon as possible. In such event, the legally constrained party shall only
divulge the information for which divulging is legally required and shall use
its best efforts to obtain an order or undertaking that such information shall
be treated as confidential.
The obligation of confidentiality under this Section shall remain in effect for
a period of five (5) years following the end of this Agreement for whatever
cause.
<PAGE> 39
40. ADMINISTRATIVE MEASURES
FDJ shall be required to take such measures, make such declarations,
authorization requests required by law and regulations in force concerning the
processes carried out and the data processed, including, but not limited to
those provided for in the Law of January 6, 1978 concerning computers, data
files and protection.
41. LANGUAGE
The parties agree that the language used for the purposes of the performance of
this Agreement is French. Accordingly, correspondence exchanged and meetings
conducted between the parties in connection with this Agreement shall be in the
French language.
For the internal requirements only of SGI, however, a version of this Agreement
in the English language is annexed hereto. The parties hereto agree that in the
event of dispute, the French version shall control in all circumstances. SGI
shall be solely liable for the translation into English of this Agreement.
42. ENTIRE AGREEMENT
The provisions of this Agreement and its Annexes express the entirety of the
agreement concluded herein between the Parties concerning the subject matter
hereof and accordingly shall prevail over any statement, exchange of
correspondence occurring prior to the signature hereof in addition to any other
provision set forth in documents exchanged between the parties and relating to
the subject matter hereof.
I
43. NO WAIVER
If, on one or more occasions, one of the parties does not require the observance
of one or more of the provisions of this Agreement, this shall not in any event
be deemed to constitute any waiver by that party of its rights under such
provision or any other provision of the Agreement in identical or any other
circumstances.
44. AMENDMENT
The material provisions of the body of this Agreement together with the
deadlines and financial terms hereof may not be amended except by means of a
written amendment signed by the duly authorized representatives of both parties
and executed at a date following the effective date of this Agreement. Other
provisions not having a substantial character, and in particular, technical
Annexes, may be amended resulting from the reports of progress
<PAGE> 40
meetings, as soon as they have been signed by the appointed operational
representatives of the parties indicated in Annex 10.
45. REFERENCES
The Parties agree that the terms of this Agreement are confidential and that SGI
shall not cite any term hereof nor make any reference hereto without having
obtained the prior consent of FDJ.
The Parties agree, however, that this Agreement may be referenced for -the
purposes of satisfying legal obligations applicable to them.
46. INTERPRETATION OF AGREEMENT
In the event of contradiction between the terms of the body of this Agreement
and those of its Annexes, the provisions of the body of this Agreement shall
prevail over those of its Annexes.
The commercial and technical proposals of SGI, including without limitation the
provisions of Annex 1, shall prevail over other Annexes, specifically Annex 6.
47. INDEPENDENCE OF THE PARTIES
Neither this Agreement, nor any provisions hereof shall be deemed to create any
partnership (societe en participation), agency or franchise between the parties
or create a relationship of employer-employee between one of the parties and the
employees of the other party.
I
48. HEADINGS
The headings of Sections in this Agreement are solely employed for ease of
reference and shall not prevail over or be deemed to modify or amend any of the
same.
49. GOVERNING LAW AND DISPUTES
49.1 Governing Law
This Agreement is governed by and shall be interpreted in accordance with the
laws of France.
<PAGE> 41
49.2 Arbitration
Any dispute arising out of this Agreement shall be submitted for binding
decision following the Conciliation and Arbitration Regulations of the Chambre
de Commerce Internationale by one or more arbitrators named in accordance with
such regulations.
The patties agree that the language of arbitration proceedings shall be French
and that the place of arbitration shall only be Paris.
49.3 Choice Of Domicile And Jurisdiction
The parties hereby elect domicile at their respective registered offices. Any
notice required to be served hereunder as a result of carrying out any of the
terms of this Agreement shall be addressed to the respective registered offices
of the Parties.
49.4 Notice
Any notice or other communication under this Agreement shall be deemed given if
delivered in writing to the intended recipient either in person, or by mail,
certified or registered, postage prepaid, or by recognized overnight delivery
service, and by fax to the intended recipient at the address and facsimile
number specified herein:
<TABLE>
<CAPTION>
If to SGI: If to FDJ:
<S> <C>
Scientific Games Inc. La Francaise des Jeux
Attention: Mr. William G. Malloy Attention: President Directeur General
President and CEO 5-7 rue Beffroy
1500 Bluegrass Lakes Parkway 92523 Neuilly sur Seine
Alpharetta, Georgia 30004 FRANCE
USA
With a copy to Mr. C. Gray Bethea, Jr With a copy to the Departement Juridique
Vice-President and General Counsel Fax No. 33 141 10 38 30
Fax No. 1770 343 8798
</TABLE>
or such other address or facsimile number as a party may specify from time to
time pursuant to this Section.
Notice sent in the manner described above shall be deemed effectively given as
of the date of receipt.
Made in Neuilly-sur-Seine, the -day of 1,1998
In two originals
<PAGE> 42
For and on behalf of For and on behalf of
La Francaise des Jeux Scientific Games Inc.
Mr. Bertrand GALLE Mr. Bruce H. LONGHURST
President Directeur General Vice President International
<PAGE> 43
ANNEX 1: DESCRIPTION OF THE SYSTEM, ITS FUNCTIONALITIES AND
INTERFACES
THIS ANNEX DESCRIBES THE SGI.NET@ITGS STANDARD SYSTEM, THE FUNCTIONAL
SPECIFICATIONS OF FDJ WHICH COULD BE IDENTIFIED UP UNTIL THE PRESENT TIME, AS
WELL AS THE PRELIMINARY SPECIFICATIONS OF THE INTERFACES WITH THE PROCESSING
SYSTEM OF FDJ.
THIS ANNEX IS COMPOSED OF THE FOLLOWING DOCUMENTS:
I A/ SGI.NET ITGS General Product Description, version 001 dated 31.08.1998
IB/ SGI.NET ITGS Functional List, version 001 dated 31.08.1998
IC/ Functional Specifications of FDJ
ID/ Modernization of the central warehouse - Functional Cahier des Charges
version 2.2
lE/ Transfer to the Euro version 001 dated 04.06.1998
lF/ General Specifications of the FORTUNA interfaces dated 15.10.1998
I G/ Various other obligations of SGI
<PAGE> 44
ANNEXE 2: SPECIFICATIONS DES MATERIELS AFFERENTS AU SYSTEME
This annex describes all hardware components that are contained in the
standard scope of delivery. SGI shall be responsible for the
installation of the hardware components listed in this annex. SGI
guarantees that all delivered hardware and especially all keyboards are
in the French version.
I Hardware Specification Primary Data Center
1.1. Backend Systems
<TABLE>
<CAPTION>
Pos. qty. Description
<S> <C> <C>
1 1 AlphaServer 8200 5/625
Main Memory 2GB
2 CPUs
2 1 AlphaServer 8200 5/625
Main Memory 2GB
1 4 CPUs
3 2 redundant power supply for AlphaServer 8200
4 4 4.3GB UltraSCSI disk for page/swapfiles
5 2 PCI / Ethernet adapter (10/100 Mbit)
6 2 PCI / FDDI adapter, DAS
7 2 PCI / UWD adapter to connect tape library systems
8 2 350GB DLT tape library systems
9 4 PCI / UWD adapter to connect disk subsystem
10 1 Disk subsystem containing
3 x Data Center Cabinets
2 x UltraSCSI disk controllers / redundant configuration redundant power supplies
72 x 4.3GB UltraSCSI disks
1 1 41 x 9.1GB UltraSCSI disks
1 11 1 2 1 Console Terminals I
</TABLE>
1.2 Front-End Systems
<TABLE>
<CAPTION>
Pos. qty. Description
<S> <C> <C>
1 4 AlphaServer 800 5/400
Main memory 384 MB
I CPU
2 4 1 EISA / Ethernet adapter
3 4 PCI / FDDI adapter, DAS
4 8 4.3GB UltraSCSI disk for page/swapfiles
5 2 19" Cabinets
6 2 12/24GB DAT tape
7 4 1 PCI / 4-Port synchronous communications
8 8 1 PCI / to connect disk subsystem
</TABLE>
CONTRAT FORTUNA - ANNEXE2 CONFIDENTIEL 1/10
<PAGE> 45
<TABLE>
<CAPTION>
POS. QtY. Description
<S> <C> <C>
9 2 Disk subsystem containing
4 x StorageWorks Container
redundant power supplies for StorageWorks container
14 x 4.3GB UltraSCSI disks
10 2 Console Terminals
</TABLE>
1.3 Monitor & Console System
<TABLE>
<CAPTION>
POS. QtY. Description
<S> <C> <C>
1 2 Digital Personal Workstation 433au
Main Memory 256MB
I CPU
4.3GB UltraSCSI Disk
2 2 Graphics adapter
3 2 PCI / FDDI adapter, DAS
4 2 12/24GB DAT tape
5 2 21" Monitor
6 2 Keyboards
7 1 DECserver to connect AlphaServer console ports
8 8 VT Terminals for systems operations
9 1 DECserver to connect VT terminals
10 1 Personal Computer Pentium H
17" Monitor
Main Memory 128MB
lx 4GB SCSI Disk
used for LAN Hub Management
1 TD-CF77 radio clock
</TABLE>
CONTRAT FORTUNA - ANNEXE2 CONFIDENTIEL 2/10
<PAGE> 46
2. Hardware Specification Backup Data Center
2.1 Backend Systems
<TABLE>
<CAPTION>
POS. Qty- Description
<S> <C> <C>
I I AlphaServer 8200 5/625
Main Memory 2GB
2 CPUs
2 1 AlphaServer 8200 5/625
Main Memory 2GB
4 CPUs
3 2 redundant power supply for AlphaServer 8200
4 4 4.3GB UltraSCSI disk for page/swapfiles
5 2 _PCI / Ethernet adapter ( 10/100 Mbit
6 2 PCI / FDDI adapter, DAS
7 2 PCI / UWD adapter to connect tape systems
8 2 350GB DLT tape library systems
9 4 PCI / UWD adapter to connect disk subsystem
10 1 Disk subsystem containing
3 x Data Center Cabinets
2 x UltraSCSI disk controllers / redundant configuration
redundant power supplies
72 x 4.3GB UltraSCSI disks
141 x 9.1GB UltraSCSI disks
1 1 21 Console Terminals
</TABLE>
2.2 Frontend Systems
<TABLE>
<CAPTION>
POS. Qty. Description
<S> <C> <C>
1 4 AlphaServer 800 5/400
Main memory 384 MB
I CPU
2 4 1 EISA / Ethernet adapter
3 4 PCI / FDDI adapter, DAS
4 8 4.3GB UltraSCSI disk for page/swapfiles
5 2 19" Cabinets
6 2 12/24GB DAT tape
7 4 1 PCI / 4-Port synchronous communications
8 8 PCI / UWD adapter to connect disk subsystem
9 2 Disk subsystem containing
4 x StorageWorks Container
redundant power supplies for StorageWorks container
1 114 x 4.3GB UltraSCSI disks
0 1 21 Console Terminals
</TABLE>
CONTRAT FORTUNA * ANNEXE2 CONFIDENTIEL 3/10
<PAGE> 47
2.3 Monitor & Console System
<TABLE>
<CAPTION>
POS. Qty. Description
<S> <C> <C>
I I Digital Personal Workstation 433au
Main Memory 256MB
1 CPU
4.3GB UltraSCSI Disk
2 1 Graphics adapter
3 1 1 PCI/FDDI adapter, DAS
4 1 12/24GB DAT tape
5 1 2 1 " Monitor
6 1 Keyboard
7 1 DECserver to connect AlphaServer console ports
8 8 VT Terminals for systems operations
9 1 DECserver to connect VT terminals
10 1 Personal Computer Pentium H
17" Monitor
Main Memory 128MB
1 x 4GB SCSI Disk
used for LAN Hub Management
</TABLE>
3. Hardware Specification Printers
<TABLE>
<CAPTION>
POS. Qty. Description
<S> <C> <C>
1 3 l7ppm laser printer configured
for use with Monitor & Console System
</TABLE>
CONTRAT FORTUNA *
ANNEXE2
CONFIDENTIEL
<PAGE> 48
4. Hardware Specification Test System
4.1 Test System Backend
<TABLE>
<CAPTION>
POS. Qty. Description
<S> <C> <C>
I I AlphaServer 800 51500
Main memory 512 N11B
I CPU
2 1 EISA/Ethernet adapter
3 1 PCI/FDDI adapter, DAS
4 1 4.3GB UltraSCSI disk for page/swapfiles
5 1 19" Cabinet
6 1 PCI/UWSE adapter to connect tape
7 1 35GB DLT tape
8 1 PCI/UWD adapter to connect disk subsystem
9 1 Disk subsystem containing
2 x StorageWorks Container
1 16 x 9. IGB UltraSCSI disks
1 10 1 1 1 Console Terminal I
</TABLE>
4.2 Test System Frontend
<TABLE>
<CAPTION>
Pos. Qty. Description
<S> <C> <C>
1 1 AlphaServer 800 5/400
Main memory 256 MB
I CPU
2 1 1 EIS A/Ethernet adapter
3 1 PCI/FDDI adapter, DAS
4 1 4.3GB UltraSCSI disk for page/swapfiles
5 1 19" Cabinet
6 1 12/24GB DAT tape
7 1 1 PCI/4-Port synchronous communications
8 1 PCI/UWSE adapter to connect disk subsystem
9 1 Disk subsystem containing
1 x StorageWorks Container
3 x 4.3GB UltraSCSI disks
10 I I Console Terminal
</TABLE>
CONTRAT FORTUNA * ANNEXE2 CONFIDENTIEL
<PAGE> 49
5. Network Components Primary Data Center
<TABLE>
<CAPTION>
Pos. Qty. Description
<S> <C> <C>
1 1 19" Cabinet
2 2 Multiswitch 900 Multiswitching System
3 4 redundant power supplies for Multiswitching System
4 4 1 6-Port FDDI concentrator to connect AlphaServer System to FDDI
15 1 132-Port Ethernet IOBase Switch
16 1 11 x FDDI, 6x Ethernet FDDI/Ethernet Switch
</TABLE>
5.1 The FDDI connection between the primary and backup data center will be
provided by FDJ.
6. Network Components Backup Data Center
<TABLE>
<CAPTION>
Pos. Qty. Description
<S> <C> <C>
1 1 19" Cabinet
2 2 Multiswitch 900 Multiswitching System
3 4 redundant power supplies for Multiswitching System
4 1 3 1 6-Port FDDI concentrator to connect AlphaServer System to FDDI
5 1 132-Port Ethernet IOBase Switch
6 1 1 Ix FDDI, 6x Ethernet FDDI/Ethernet Switch
</TABLE>
6.1 The FDDI connection between the primary and backup data center shall be
provided by FDJ.
7. Requirements for the computer centers to be provided by FDJ
7.1 FDJ shall provide the primary data center and backup data center sites
where the computer equipment listed in this annex is to be installed
according to the specifications of the original equipment manufacturer
(DEC: System and Option Catalog EC 19080-32 / April 98).
7.2 FDJ will apply its own security standards. However FDJ will study any
specific requirements of SGI based on technical constraints and submit
SGI with possible solutions.
CONTRAT FORTUNA * ANNEXE2 CONFIDENTIEL
<PAGE> 50
8. Room and power requirements primary data center
All power requirements refer to one cabinet.
<TABLE>
<CAPTION>
System Ref. No. of Height Width Depth Clearance Clearance Power
Cabinets in mm in trim in mm Front in turn Rear in mm Requirements
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Backend System 2 A.2-1 2 1700 1200 925 1500 1000 220-240(240)V
AlphaServer Pos. 1,2 5OHz-6OHz
8200 Single-phase line-to-line or line-to
neutral
Max. input current 16A rms
Surge current 80A peak
Rating 16A
dual power controller
Backend System 2 A.2.1 3 1700 1800 900 1500 1000 220-240(240)V
Disk Subsystem Pos. 10 5OHz
Single-phase
3 Wire, 2 pole IEC309
Rated current IOA
dual power controller
Frontend System 2 A.2.2 2 1700 1200 900 1500 1000 220-240(240)V
AlphaServer 800 Pos. 5 5OHz
Single-phase
3 Wire, 2 pole IEC309
16A
dual power controller
Network 2 A.6 1 2100 800 800 1500 1000 220-240(240)V
LAN Pos. 1 50Hz
Single-phase
3 Wire, 2 pole IEC309
16A
dual power controller
Test System 2 A.5.1 1 1700 600 900 1500 1000 220-240(240)V
Backend 50Hz
Single-phase
3 Wire, 2 pole IEC309
16A
single power controller
Test System 2 A.5.2 1 1700 600 900 1500 1000 220-240(240)V
Frontend 50Hz
Single-phase
3 Wire, 2 pole IEC309
16A
single power controller
</TABLE>
CONTRAT FORTUNA * ANNEXE2 CONFIDENTIEL
<PAGE> 51
9. Room and power requirements secondary data center
All power requirements refer to one cabinet.
<TABLE>
<CAPTION>
System Ref. No. of Height Width Depth Clearance Clearance Power
Cabinets in mm in mm in nun Front in mm Rear in mrn Requirements
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Backend System 2 A.3.1 2 1700 1200 925 1500 1000 220-240(240)V
AlphaServer Pos. 1,2 50Hz-6OHz
8200 Single-phase line-to-line or line-to
neutral
Max. input current 16A rms
Surge current 80A peak
Rating 16A
dual power controller
Backend System 2 A.3.1 3 1700 1800 900 1500 1000 220-240(240)V
Disk Subsystem Pos. 10 5OHz
Single-phase
3 Wire, 2 pole IEC309
Rated current I OA
dual power controller
Frontend System 2 A. 3.2 2 1700 1200 900 1500 1000 220-240(240)V
AlphaServer 800 Pos. 5 5OHz
Single-phase
3 Wire, 2 pole IEC309
16A
dual power controller
Network 2 A.7 1 2100 800 800 1500 1000 220-240(240)V
LAN Pos. I 5OHz
Single-phase
3 Wire, 2 pole IEC309
16A
</TABLE>
10. Schematic diagram
This section contains a drawing of the structure of the offered
hardware. This diagram is only intended to provide a general overview.
The actual scope of delivery is exclusively defined by the annex
sections 2A.I. to 2A.8. with the exclusion of section 2A.9.
CONTRAT FORTUNA * ANNEXE2 CONFIDENTIEL
<PAGE> 52
11. Auditing system
Any DEC Alpha in the installed configuration can be used for
audit purposes. No additional hardware is necessary or proposed. This
operation does not have any impact on the performances of the system.
12. Archiving system
None proposed
13. Parameterising system for SciScan terminals
It is proposed that an existing Pentium class PC running
Windows 95 or NT or higher is used. A flatbed scanner will be provided
by Scientific Games.
14. Retailer hot-line - Vitrolles
The existing PC's in retailer hot-line are assumed to be
usable. They must be Pentium class PC's running Windows 95 or NT or
higher with 32 megabytes of RAM and 300 megabytes of available hard
disk space. The client software running on these PC's will connect with
the DEC host back-end computer, so the LAN network should be arranged
accordingly. There should be no additional peripherals required. This
is planned as a parallel running application to the existing system.
15. 'Surveillance des jeux' - Moussy
The existing PC's are assumed to be usable. They must be
Pentium class PC's running Windows 95 or NT or higher with 32 megabytes
of RAM and 300 megabytes of available hard disk space. The client
software running on these PC's will connect with the DEC host back-end
computer, so the network should be arranged accordingly. There should
be no additional peripherals required. Procedures will be similar to
the existing ones.
16. FDJ central warehouse - Fosses
The existing PC's are assumed to be usable. They must be Pentium class
PC's running Windows 95 or NT or higher with 32 megabytes of RAM and
300 megabytes of available hard disk space. The client software running
on these PC's will connect with the DEC host back-end computer, so the
network should be arranged accordingly. Additional peripherals and
devices, such as label printers (3) and scanners/ portable terminals to
read barcode (10 units), will be provided and installed by SGI.
17. DCM- Boulogne and other sites
Existing Pentium class PC's running Windows 95 or NT or higher
are to be used. There are no additional requirements for these PC's.
CONTRAT FORTUNA * ANNEXE2 CONFIDENTIEL
<PAGE> 53
ANNEXE 3: LISTE DES LOGICIELS SYSTEME ET APPLICATIFS
This annex describes all software licenses that are contained in the
SGI.NET ITGS delivery to FDJ.
I/ Central system
1.1. All licenses of Oracle and VMS which are currently used with the
System and which are subject to the following deliveries offer the
widest standard use available for the end user that can be obtained
from the original supplier.
CONTRATFORTUNA-ANNEXE3 CONFIDENTIEL 1/10
<PAGE> 54
1.2. Software Licenses SGI-NET GS Application Software
<TABLE>
<CAPTION>
Product Short Description Qty/ Qty Installation Distribution Source License Type Version
Sys total done by Media Code
Delivery
<S> <C> <C> <C> <C> <C> <C> <C> <C>
SGI-NET ITGS Application Software SGI-NET ITGS for n/a I Sol Tape yes based on number V1.0
maximum 15.000 instant validations terminals of terminals
</TABLE>
1.3. Software Licenses Primary Data Center
1.3.1. Backend-Systems
<TABLE>
<CAPTION>
Product Short Description Qty/ Qty Installation Distribution Source
Sys total done by Media Code
Delivery
<S> <C> <C> <C> <C> <C> <C>
OpenVMS Base License Operating System Base License for AlphaServer 1 2 Sol CD-ROM no
Systems
Enterprise Integration Additional Products for the operating system 1 2 SGI CD-ROM no
Packaize
OpenVMS User License Operating System User License n/a Sol n/a n/a
VMScluster Software OpenVMS Cluster Software rda 2 Sol CD-ROM no
Volume Shadowing OprnVMS Host Based Volume Shadowing 1 2 Sol CD-ROM no
Software
DECnet/OSI Extended DECnet / OSI Extended Function to provide n/a I Sol CD-ROM no
Function Cluster Alias functions
HSZ Firmware Firmware License for disk controllers n/a 4 Sol Flash-ROM no
ORACLE RDBMS Oracle Enterprise Edition n/a 72 SGI CD-ROM no
ORCALE Parallel Server Oracle Enterprise Edition n/a 72 Sol CD-ROM no
Parallel Server Option
System Management Tools Data Collector CD-ROM no
TRAD V2.0
Console Manager
<CAPTION>
Product License Type Version
<S> <C> <C>
OpenVMS Base License BASE V7.1-IHI
Enterprise Integration BASE V7.l-lHI
Packaize
OpenVMS User License CONC V7.1-IHI
VMScluster Software TRAD V7.1-IHI
Volume Shadowing TRAD V7.1-IHI
Software
DECnet/OSI Extended TRAD, V7.1-IHI
Function
HSZ Firmware n/a V3.0
ORACLE RDBMS RT V7.3.2.3.2
run time
ORCALE Parallel Server RT V7.3.2.3.2
run time
System Management Tools
</TABLE>
1.3.2 Frontend- Systems
<TABLE>
<CAPTION>
Product Short Description Qty/ Qty Installation Distribution Source
Sys total done Media Code
by Delivery
<S> <C> <C> <C> <C> <C> <C>
OpenVMS Base License Operating System Base License for AlphaServer -1 4 Sol CD-ROM no
Systems
<CAPTION>
Product License Type Version
<S> <C> <C>
OpenVMS Base License BASE V7.1-11-11
</TABLE>
CONTRATFORTUNA-ANNEXE3 CONFIDENTIEL 2/10
<PAGE> 55
<TABLE>
<CAPTION>
Product Short Description Qty/ Qty I Installation Distribution Source
Sys total done Media Code
by Delivery
<S> <C> <C> <C> <C> <C> <C>
Enterprise Integration Additional Products for the operating system 1 4 SGI CD-ROM no
Package n/a 8 SGI n/a n/a
Open
nVMS UseLr License operating System User License no
VMScluster Software OpenVMS Cluster Software n/a 4 SGI CD-ROM
Volume Shadowing openVMS Host Based Volume Shadowing 1 4 SGI CD-ROM no
Software
DECnet/OSI Extended DECnet / OSI Extended Function to provide n/a 2 SGI CD-ROM no
Function Cluster Alias functions;
X.25 Software DEC X.25 Software 1 41 SGI CD-ROM no
System Management Tools Data Collector SGI CD-ROM no
System Watchdog Agent
Console Manager
<CAPTION>
Product License Type Version
<S> <C> <C>
Enterprise Integration BASE V7.1-IHI
Package CONC V7.1-IHI
Open
nVMS UseLr License TRAD V7.1-IHI
VMScluster Software TRAD V7.1-IHI
Volume Shadowing
Software
DECnet/OSI Extended TRAD, V7.1-IHI
Function
X.25 Software TRAD
System Management Tools TRAD V2.0
</TABLE>
1.3.3. Monitor & Console System
<TABLE>
<CAPTION>
Product Short Description Qty/ Qty Installation Distribution Source
Sys total done Media Code
by Delivery
<S> <C> <C> <C> <C> <C> <C>
OpenVMS Base License operating System Base License for AlphaServer 1 2 SGI CD-ROM no
Systems no
N AS 150 Package Additional Products for the operating system 1 2 SGI CD-ROM
OpenVMS User License - Operating System User License n/a 6 SGI n/a n/a
VMScluster Software_ OpenVMS Cluster Software n/a I SGI CD-ROM no
System Management Tools Data Collector 1 2 SGI CD-ROM no
Console Manager
System Watchdog Agent
Windows NT4.0 License for Hub Management PC CD-ROM no
Workstation License
SN MultiChassis Manager iGI CD-ROM no
Hub Management Software
<CAPTION>
Product License Type Version
<S> <C> <C>
OpenVMS Base License BASE V7.1-IHI
BASE V7.1-IHI
N AS 150 Package
OpenVMS User License CONC V7.1-IHI
VMScluster Software_ TRAD V7.1-IHI
System Management Tools TRAD V2.0
Windows NT4.0 n/a 40
Workstation License
PERS
</TABLE>
1.3.4. Test Backend System
<TABLE>
<CAPTION>
Product Short Description Qty/ Qty Installation Distribution Source
Sys total done Media Code
Delivery
<S> <C> <C> <C> <C> <C> <C>
OpenVMS Base License Operating System Base License for AlphaServer I I SGI CD-ROM no
Systems
<CAPTION>
Product License Type Version
<S> <C> <C>
OpenVMS Base License BASE V7.1-IHI
</TABLE>
CONTRATFORTUNA-ANNEXE3 CONFIDENTIEL 3/10
<PAGE> 56
<TABLE>
<CAPTION>
Product Short Description Qty/ Qty Installation Distribution Source
Sys total done Media Code
by Delivery
<S> <C> <C> <C> <C> <C> <C>
Enterprise Integration Additional Products for the operating system I I SGI CD-ROM no
Package
OpenVMS User License Operating System User License n/a 8 SGI n/a n/a
ORACLE RDBMS Oracle Enterprise Edition n/a 16 SGI CD-ROM no
I
ORCALE Parallel Server Oracle Enterprise Edition n/a 16 SGI CD-ROM no
Parallel Server Option
System Management Tools Data Collector I I SGI CD-ROM no
Console Manager
System Watchdog Agent
<CAPTION>
License Type Version
<S> <C> <C>
Enterprise Integration BASE V7.1-IHI
Package
OpenVMS User License CONC V7.1-IHI
ORACLE RDBMS RT V7.3.2.3.2
run time
ORCALE Parallel Server RT V7.12.12
run time
System Management Tools TRAD V2.0
</TABLE>
1.3.5. Test Frontend System
<TABLE>
<CAPTION>
Product Short Description Qty/ Qty Installation Distribution Source
Sys total done Media Code
by Delivery
<S> <C> <C> <C> <C> <C> <C>
OpenVMS Base License Operating System Base License for AlphaServer I I SGI CD-ROM no
Systems
Enterprise Integration Additional Products for the operating system I I SGI CD-ROM no
Package I
OpenVMS User License Operatiq&System User License n/a 2 SGI n/a n/a
X.25 Software DEC X.25 Software I I SGI CD-ROM no
System Management Tools Data Collector I I SGI CD-ROM no
Console Manager
System Watchdog Agent
<CAPTION>
Product License Type Version
<S> <C> <C>
OpenVMS Base License BASE V7.1-IHI
Enterprise Integration BASE V7.1-IHI
Package
OpenVMS User License CONC V7.IAHI
X.25 Software TRAD
System Management Tools TRAD V2.0
</TABLE>
1.4. Software Licenses Backup Data Center
1.4.1. Backend Systems
<TABLE>
<CAPTION>
Product Short Description Qty/ Qty Installation Distribution Source
Sys total done Media Code
by Delivery
<S> <C> <C> <C> <C> <C> <C>
OpenVMS Base License Operating System Base License for AlphaServer 1 2 SGI CD-ROM no
Systems
Enterprise Integration Additional Products for the operating system 1 2 SGI CD-ROM no
Package I I I I II
OpenVMS User License Operating System User License n/a 40 SGI n/a
<CAPTION>
Product License Type Version
<S> <C> <C>
OpenVMS Base License BASE V7.1-1HI
Enterprise Integration BASE V7.1-IHI
Package
OpenVMS User License CONC V7.I-JHI
</TABLE>
CONTRATFORTUNA-ANNEXE3 CONFIDENTIEL 4/10
<PAGE> 57
<TABLE>
<CAPTION>
Product Short Description Qty/ Qty Installation Distribution Source
Sys total done Media Code
by Delivery
<S> <C> <C> <C> <C> <C> <C>
VMScluster Software OpenVMS Cluster Software n/a 2 SGI CD-ROM no
Volume Shadowing OpenVMS Host Based Volume Shadowing 1 2 SGI CD-ROM no
Software
DECriet/OSI Extended DECnet / OSI Extended Function to provide n/a I SGI CD-ROM no
Function Cluster Alias functions I
HSZ Firmware Firmware License for disk controllers n/a 4 SGI Flash-ROM no
ORACLE RDBMS oracle Enterprise Edition n/a 72 SGI CD-ROM no
ORCALE Parallel Server oracle Enterprise Edition n/a 72 SGI CD-ROM no
Parallel Server Option_ --
System Management Tools Data Collector 1 2 SGI CD-ROM no
Console Manager
System Watchdog Agent
<CAPTION>
Product License Type Version
<S> <C> <C>
VMScluster Software TRAD V7.1-IHI
Volume Shadowing TRAD V7.1-IHI
Software
DECriet/OSI Extended TRAD V7.1-IHI
Function
HSZ Firmware V3.0
ORACLE RDBMS RT V7.3.2.3.2
run time
ORCALE Parallel Server RT V7.3.2.3.2
run time
System Management Tools AD V2.0
</TABLE>
1.4.2. Frontend Systems
<TABLE>
<CAPTION>
Product Short Description Qty/ Qty Installation Distribution Source
Sys total done Media Code
by Delivery
<S> <C> <C> <C> <C> <C> <C>
OpenVMS Base License Operating System Base License for AlphaServer 1 4 SGI CD-ROM no
Systems
Enterprise Integration Additional Products for the operating system 1 4 SGI CD-ROM no
Package
OpenVMS User License Operating System User License n/a 8 SGI n/a n/a
VMScluster Software OpenVMS Cluster Software n/a 4 SGI CD-ROM no
Volume Shadowing OpenVMS Host Based Volume Shadowing 1 4 SGI CD-ROM no
Software
DECnet/OSI Extended DECnet / OSI Extended Function to provide n/a 2 SGI CD-ROM no
Function Cluster Alias functions
X.25 Software DEC X.25 Software 1 4 SGI CD-ROM no
System Management Tools Data Collector 1 4 SGI CD-ROM no
Console Manager
System Watchdog Agent
<CAPTION>
Product License Type Version
<S> <C> <C>
OpenVMS Base License BASE V7.1-IHI
BASE V7.1-IHI
Enterprise Integration
Package
OpenVMS User License CONC V7.1-IHI
VMScluster Software TRAD V7.1-IHI
Volume Shadowing TRAD V7.1-IHI
Software
DECnet/OSI Extended TRAD V7.1-IHI
Function
X.25 Software TRAD V2.0
System Management Tools TRAD,
</TABLE>
CONTRATFORTUNA-ANNEXE3 CONFIDENTIEL
<PAGE> 58
1.4.3. Monitor & Console System
<TABLE>
<CAPTION>
Product Short Description Qty/ Qty Installation Distribution Source
Sys total done Media Code
Delivery
<S> <C> <C> <C> <C> <C> <C>
OpenVMS Base License Operating System Base License for AlphaServer I I SGI CD-ROM no
Systems
NAS150 Package Additional Products for the operating system I I SGI CD-ROM no
OpenVMS User License Operating System User License n/a 3 SGI n/a n/a
System Management Tools Data Collector I I SGI CD-ROM noTRAD
Console Manager
System Watchdog Agent
Windows NT4.0 License for Hub Management PC I I SGI CD-ROM no
Workstation License
ClearVISN MC ClearVISN MultiChassis Manager I CD-ROM I no
1 Hub Management Software
<CAPTION>
Product License Type Version
<S> <C> <C>
OpenVMS Base License BASE V7.1-IHI
NAS150 Package BASE V7.1-IHI
OpenVMS User License CONC V7.1-IHI
System Management Tools V2.0
Windows NT4.0 111a 4.0
Workstation License
ClearVISN MC PERS
</TABLE>
1.5. BMC Patrol Tools
On request of FDJ the usability of BMC Patrol System Management Tools
shall be evaluated by SGI in the course of contract fulfillment. In
case the usage of these tools for SGI-NET ITGS is considered feasible
by SGI a separate proposal will be submitted by SGI to FDJ. The
purchase of these tools by FDJ can be handled by an individual order
outside this supply agreement.
1.6. The software licenses for the following systems/work places shall be
expressly excluded:
i) All test tools
ii.) All development tools
iii.) All software for PC work places and their corresponding
networking as well as for all file servers of the SGI/FDJ
systems operations or other departments of FDJ
CONTRATFORTUNA-ANNEXE3 CONFIDENTIEL
<PAGE> 59
2. / SCISCAN TERMINAL SOFTWARE MODULES AND DEVELOPMENT ENVIRONMENT
All the following software or software modules will be delivered to FDJ as well
as source code (except for the "Elvis" module listed under ss. 2.1, and the
modules listed under ss. 2.2 and ss. 2.3 of this annex) and detailed
specifications so that FDJ is in a position with the required training to
maintain and modify the applications by itself. All the following software can
be used by FDJ without any restriction providing FDJ runs it on Sciscan or
Sciscan-type terminals.
2.1. General Application Modules
1. Download Manager: Process that starts the download process upon receiving a
message (to do so) from another process.
2. Alarm Manager: Process that manages an alarm table and sends alarm messages
when necessary to other processes. One example might be to notify an
application of a scheduled download.
3. Modem Manager: Process that handles all modem (hardware) related processing.
The process communicates with the modem specific hardware driver.
4. ELVIS (Electronic Latex Validation Software): Process that handles all latex
evaluation functions. This process reads signature map data files as well as
contains the virtual machine that executes virtual signature map (Jello)
programs.
5. IPP Manager: Process that handles communication and control between the
upper MCP (Master Control Processor) and the lower IPP (Intelligent
Peripheral Processor) board.
6. Print Manager: Process that managers the printing requirements of the
Sciscan unit. Formats and queues reports sent from the terminal application,
or from the host, for output to the printer.
7. Window Manager: Process to handle all LCD windowing functionality on the
Sciscan unit.
8. Memory Manager: Process to manage block allocation of SRAM and Flash memory
for process related needs. (i.e. signature map storage, unit configuration,
etc.
9. Configuration Manager: Process that manages a configuration data file which
contains items like screen definitions, customer specific data, modem
initialization strings, system settings, or other process related data.
10. OSTRAPS (Special.dll) Operating system specific subroutine library for
routines that are restricted by the OS.
<PAGE> 60
11. Terminal Application: Customer specific application that handles user 1/0,
manages customer specific needs, procedures, or policies. The terminal
application controls overall unit functionality.
12. Host Manager: Specific protocol definitions, current HDLC.
13. SCISCAN: (Also known as HUB) An executable module that functions as a
communication router between processes. This is the first application run
by the Sciscan at system startup.
2.2. Signature Map Software
1. Game signature maps require 100 to 15,000 bytes. For example, probability
games take 1 OK to 15 K bytes. Probability games are stored in Flash while
smaller games are stored in SRAM.
2. Signature Map Software - Software for generating and reading signature maps
has evolved over time and there are multiple versions of the ELVIS program
still being utilized in the field. A signature map can best be thought of
as a template, defining the general layout of a ticket. There are four
different types of signature maps in use. They can be defined as "Young
Elvis", "Beach Elvis", "Sumo Elvis", and "Japanese Elvis". Although each
different type is currently applied to individual customers, they each can
be separately categorized. None of the programs listed are in a condition
prepared for release outside of Scientific Games Personnel (NOT FOR
RELEASE)
3. "Young Elvis" - A signature map in the form of a data file that is read by
the ELVIS executable program residing on the Sciscan unit. Currently used
in West Virginia only.
4. "Beach Elvis" - A signature map in the form of a data file with a file
header that is read by the ELVIS executable program residing on the Sciscan
unit. Currently used in Main, Nebraska, and Virginia, although headers vary
between customers.
5. "Sumo Elvis" - A signature map in the form of a virtual program that is
executed by a Virtual Machine which is part of the ELVIS executable program
residing on the Sciscan unit. The "Sumo Elvis" code is generated through a
Visual Jello O.E.L.L.0 - Japanese Elvis Language O.x) development tool.
6. "Japanese Elvis" - A signature map in the form of a vitual. program that is
executed by a Virtual Machine which is part of the ELVIS executable program
residing on the Sciscan unit. The "Japanese Elvis" code is generated
through a predefined high level programming source code and compiled into
the virtual program. "Japanese Elvis" signature maps are used in the
probability gaming market exclusively.
7. Support Utilities - The signature map generation process has several
utility programs which are used "in house" to aid in the production and
release of signature maps. The following utilities are currently in use:
<PAGE> 61
8. "Ticket Data Base Builder" - This utility is used to acquire and establish
a data set of scanned tickets for input into the "Virtual Machine Simulator
Program" used to evaluate signature maps.
9. "Virtual Machine Simulator Program" - A program designed to run in batch
mode on a personal computer which reads a "ticket data base" and processes
those tickets as if they were each scanned on a Sciscan unit and evaluated
using the virtual program signature map.
10. "Signature Map Header Utility" - Utility program used for manipulating the
header information on the "Sumo Elvis" and the "Japanese Elvis" virtual
program signature maps.
11. "Sigblast" - A program used on the Personal Computer to download signature
map files or vitual programs, depending on signature map type, to the
Sciscan unit.
12. "Fatfree Jello Compiler" - A compiler program that takes "Japanese Elvis"
source code and compiles it into ELVIS executable virtual signature map
programs for down loading into the Sciscan unit.
2.3. Probability Ticket Software
1. Probability Game Demo Software - This is the software designed to allow
results of a Sciscan units read of a ticket to be displayed on a PC's
monitor for demo purposes.
2.4. Ticket QA Software
2. "Instant Ticket QA" - Quality assurance program to measure quality of
printed tickets throughout the manufacturing process. The monitoring is
accomplished by scanning a virgin (unscratched) ticket, and scanning a
fully scratched one, to measure them against an acceptable range.
3. "Instant Ticket QA lite" - Quality assurance program to measure quality of
printed tickets throughout the manufacturing process but limiting
information available to the user. This version is designed to be released
to competing ticket manufacturers.
4. "Probability Ticket QA" - Quality assurance program to measure quality of
probability tickets throughout the manufacturing process. The monitoring is
accomplished through the scanning of a ticket scratched in a predetermined
fashion.
2.5. Software Delivery:
Several methods exist for software distribution and selected method will depend
on size of data to transfer and technological capabilities of France. The
following media are available:
i) Floppy diskette
ii) Jaz diskette
iii) CDROM
iv) Direct modem transfer
<PAGE> 62
v) Tapes - (1600bpi, 6250 reel to reel) and (8mm)
vi) Compressed files via email
vii) Ftp
viii) Tapes - (1600bpi, 6250 reel to reel) and (8mm.)
2.6. Development Environment:
Editor: Codewright
Compiler: Microware Ultra C
Operating system: Microware OS9000
Source Directory: /DEV/SCISCAN
2.7. Other software features:
- - Training mode for retailers resident on terminal
- - Modular software architecture o All software on the terminal is
downloadable
- - each module can be downloaded separately
- - Sig maps are downloadable as parameters
- - Transactions are optimised in terms of telecommunication network costs
(TRANSPAQ
<PAGE> 63
ANNEX 4: DELIVERY SCHEDULE AND MILESTONE DEADLINES
This Annex presents the conclusion of this Agreement in accordance with the
provisions of Article 16.
The Milestone Deadlines are indicated by an asterisk in the column describing
the different tasks of the performance of the Agreement. In the diagram, these
Milestone Deadlines are indicated by a star.
Detailed Specifications
The Annexes to the Agreement only contain a preliminary specification of the
functional needs of FDJ, a phase of 8 weeks starting from the date of signature
of this Agreement shall be dedicated to the joint drafting of the detailed
specifications (i.e., IHM, chaining, file formats, interfaces, reports, etc.).
<PAGE> 64
ANNEXE 5: PRESTATIONS ET FOURNITURES DE FDJ
This chapter contains the list of general services and deliverables which must
be performed from FDJ on schedule and free of charge. All such services and
deliveries will specified in detail by SGI prior to delivery.
No. deliverable/service/requirement
Al General overall project management and coordination with third parties
BI Response to SGI's or FDJ's questions concerning specification/
implementation after a written request by either party within 10
business days
-1 Coordination WAN (for terminals, for data centers, for remote
workplaces, etc.) inclusive conception, implementation, test,
installation etc. based on prior recommendations from SGI
C2 Supply of U 100 on line terminals when required Training on these
terminals as required by SGI staff Maintenance of the terminals
DI Provision of all facility location/data center equipment except
hardware/systemsoftware for SGI-NET 1TGS
D2 Provision of all elements according to the supply list ,FDJ
deliverables for hardware/systemsoftware delivery and installation"
El Definition of all kinds of instant tickets, labels, etc. intended for
(bar code) processing.
E3 Design of all the necessary printing varieties, documents and forms.
E4 Planning, definition and supply of the business configuration data.
E5 Supply of working material for testing and operation in the required
extent as detailed by SGI.
E6 Collection of basic data (actors data, game data, etc.) or conversion
from existing systems and provision of latter, in case this should be
required for the test runs.
E7 Provision of the necessary number of staff members with all the
required qualifications who are to accompany the acceptance test
runs/performance test runs.
E8 Preparation of the FDJ business methods and organization units for
online-operation
E9 Provision of all elements according to the supply list 'FDJ
deliverables for the performance test' to be jointly worked out
between SGI and FDJ.
E10 Provision of all elements according to the supply list ,FDJ
deliverables for the internal SGI-NET I tests" to be jointly worked
out between SGI and FDJ.
Ell Provision of all elements according to the supply list ,FDJ
deliverables for the functional acceptance test" to be Jointly worked
out between SGI and FDJ.
F1 Provision of operable hardware, software and communication facilities
for the connection of the FDJ systems (financial accounting system,
PCs and PC-network, etc.) to the central online system.
<PAGE> 65
Ensuring participation of an adequate number of staff members with the demanded
qualifications at the training provided by SGI.
<PAGE> 66
G2 Training of terminal operators together with SGI
G3 Training of terminal maintenance personnel together with SGI
G4 Training of terminal hotline personnel together with SGI
H1 Terminal installation planning and organization
H2 Terminal installation
H3 Terminal field maintenance
11 Preparation of the FDJ business methods and organization units for
online-operation
13 Planning and execution of final user support.
14 Computer center emergency/contingency planning including precautionary
measures.
15 Planning and execution of physical security and FDJ network.
V Planning and execution of the transition from offline-operation to
online-operation as well as planning and execution of the parallel
operation. Planning and ensuring organizational processes including work
instructions for the realization of data protection and data security based
upon SGI instructions.
<PAGE> 67
SUPPLY-ITEM LIST FOR FDJ DELIVERABLES FOR HARDWARE/SYSTEM
SOFTWARE DELIVERY AND INSTALLATION
This chapter contains the supply-item list for milestone C3/pilot test phase
which must be performed from FDJ on schedule and free of charge.
REQUIREMENTS TO THE ROOMS TO BE PROVIDED BY FDJ
In general FDJ must provide the primary data center and backup data center sites
where the computer equipment described in SGI's offer is to be installed.
ESTABLISHMENT OF DATA CENTERS
A9 Antenna existing connection for France Inter time synchronization of the
data centers
B I Provision of an LAN/WAN suitable for the connection of the hardware
components from SGI-NET ITGS (a router can be added if necessary)
B2 Provision of operable hardware, software and communication facilities for
the connection of the FDJ systems in different locations (financial
accounting system, PCs and PC-network, etc.) to the central online system.
B3 Line tracing and line access to the wide area networks (for terminal
connection, for inter data center connection, etc.) in a distribution box
in each of the data centers/locations following SGI's recommendations.
There has to be one distribution box for each computer center/location
which must be positioned within from the front end processors concerned.
(X2 1 /V 11)
B4 I Supply of the required wide area network connections to the LAN
B5 Supply of the data communication equipment (modems, etc.) with connection
to the wide area networks in the data centers/locations following SGI's
recommandations.. Connection of the front end processors via 2 to 4 lines
(X2 1N 11).
B6 Creating all the required cabling outside the data centers (interconnection
of data centers, etc.). with a coordination between SGI and the WAN
provider
B7 Connection leads to the carrier network in a distribution cabinet.
B8 Provision of the switching units for the backup wide area network
connections to terminals. (if any necessary) B9 Possibility of connecting
the terminals to the in-house testing system B10 Possibility of connecting
the in-house terminals to the production system
0B11 File transfer possibility for operation of external interfaces (financial
accounting, actors data, etc.)
C10 Sufficient quantity of data center consumables (magnetic tapes, printing
paper, printed forms, toner, etc)
ESTABLISHMENT OF PRINTERS' ROOMS
The printers rooms will be set up in accordance with the OEM specifications and
FDJ internal requirements.
<PAGE> 68
SECURITY RECOMMENDATIONS
FDJ will apply its own security standards. However FDJ will study any specific
requirements of SGI based on technical constraints and submit SGI with possible
solutions.
WORKING ROOMS FOR SGI STAFF MEMBERS
No. deliverable/service/requirement
Provision of a minimum of 3 work places in a room. Each work place have to be
equipped as follows:
1x standard office furniture (table, chair, waste basket .... )
Ix PC with terminal emulation and standard FDJ Microsoft Office Products
Ix telephone with direct dialing capability to SGI-headquarters (the
accruing telephone costs shall be borne by FDJ)
The PCs of the work places are networked ; there has to be at least one
central laser printer connected.
The work area shall provide for:
Ix fax machine
Ix cabinet that can be locked
Ix board/flip chart and writing utensils
This provisions have to be available as of hardware installation until
the end of the warranty for the software.
2 Possibility of using (sharing) a conference room
3 Possibility of secretary assistance from time to time (copies,...)
OTHER MEASURES
No. deliverable/service/requirement
1 Provision of training rooms including all the required technical
infrastructure (except training system) as far as is required.
<PAGE> 69
Annex 6
OMITTED
<PAGE> 70
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
ANNEX 7: PRICE AND PAYMENT SCHEDULE
I PRICE OF THE SYSTEM IN FRF (Delivered Duty Paid)
Central System
1.1. Hardware and Software DEC and Oracle
(capacity [*] terminals - test system included)
FDJ will acquire from SGI the central site equipment, including the equipment
set forth in Annex 2 (paragraphs 1 and 10). The price is FRF [*] excluding
taxes. Prior to the sale, the equipment shall be bought directly by SGI from DEC
France. In the event that the purchase price of this equipment by SGI is less
than FRF [*] before taxes, the price paid to FDJ to SGI shall be identical
to the price paid by SGI to DEC France.
In the event that DEC offers to SGI a definitive and non-negotiable price higher
than FRF [*] FDJ shall have the option to either (i) acquire the
equipment in question from SGI at the price proposed by DEC France or (ii)
acquire such equipment directly from DEC France.
In any event, SGI and FDJ shall participate together in the negotiation and the
conclusion of the contracts with DEC France, SGI retaining the entire liability
with respect to the specifications relating to such equipment.
1.2. SGI-NET - ITGS system:
1.2.1. Royalty of [*] usage rights (including auditing system) described in
Art. 23.2 .........................USD [*]
1.2.2. Price for extension of these usage rights per 100 connected units
...................................USD [*]
1.3. Adaptation of the Software to the specifications of FDJ (Annex I Q
......................................................... USD [*]
1.4. Support and management of SGI project ....................USD [*]
1.5. Training (Annex 16) ......................................USD [*]
<PAGE> 71
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
1.6. Maintenance (annual cost) (Annex 8):
1.6.1. Maintenance of hardware and software DEC
FDJ may acquire from SGI the maintenance of the central site equipment set forth
in Annex 2 (paragraphs I to 10). The estimated price of DEC, without the
maintenance of the Software Oracle, is FRF [*].
in such case, SGI and FDJ shall participate in the negotiation and the
conclusion of the contracts with DEC France, SGI retaining the entire liability
with respect to the specifications relating to such maintenance services.
1.6.2. SGI-NET software initial configuration
(Remote System Control included)([*] of the license)
.................................................**'** USD [*]
1.6.3. SGI-NET software extension
per 100 additional connected units
([*]) ........................................... USD [*]
1.7. Options:
1.7.1. Development system for SGINET central
Software (Annex 14) .............................. USD [*]
1.7.2. Oracle "full use" license ........................ USD [*]
1.7.3. Additional printer equipment for
Central Site (Annex 14) .......................... USD [*]
1.8. Additional options: transfer of know-how:
Training FDJ development staff:
This price is based on the costs that SGI would incur for training of the people
internally. It is also assumed the staff in question would be experienced in
Pascal and SQL programming,
Training (6 months) plus programming practice(6 months).
Training location Vienna, in the English language, price excludes
accommodation and travel expenses ......................... USD [*]
1.9. Hourly rates for the following services:
- programming .........................................USD [*]/hour
- management, design and analysis .....................USD [*]/hour
<PAGE> 72
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
Assignments will be quoted on a project by project basis in an attempt
to reduce costs.
1.10. It is possible to expand the capacity of the System beyond [*]
terminals by [*] in adding double FEP's per site.
2. Point of Sale equipment (SciScan@)
2.1. SciScan@ hardware:
2.1.1. Initial order [*] units ..........................FRF [*]
SciScan@ player display [*] units ................FRF [*]
2.1.2. SciScan@ hardware maintenance per year Initial
order [*] units (starting after the
guarantee period) ................................FRF [*]
2.1.3. SciScan@ hardware price after the initial order
Quantity > [*] same Price as initial order
[*] < Q < [*] price + [*]%
[*] < Q < [*] price + [*]%
the previous prices will be updated using the revision price formula mentioned
in this annex.
2.2. SciScan@ software:
2.2.1. SciScan@ software license price included in the price of the
software of the central site in Section I of the present
Annex.
2.2.2. SciScan@ software maintenance included in the price of the software of
the central site in Section 1 of the present Annex.
2.2.3. SciScan@ royalty fees for [*] units ...................USD [*]
2.3. For each additional unit connected to the system, a SciScan@ royalty
fee of USD [*] per SciScan will be paid to SGI by FDJ.
This will not be applied to the devices included in the future on-line
Loto terminal of FDJ.
3. Assistance for the exvioitation
<PAGE> 73
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
The price invoiced by SGI for the services described in Annex I I will
be calculated as follows:
Costs pertaining to wages of the SGI employee + [*] (including the
project support and the SGI profit)
Plus
The travel and lodging expenses on site as per vouchers.
SGI an FDJ will try to minimize these costs.
4. Price Revision
This formula applies to the hardware and the software of the central site and
the SciScan Terminal and for the maintenance of the Software after the end of
the first year of maintenance.
[*]
with
[*]
[*]
[*]
[*]
[*]
[*]
[*]
In the event of disappearance of the retained index, and in default of agreement
between the parties with respect to a new index within two (2) months, the
parties hereby accord competence to the President of the Tribunal of the Grande
Instance de Paris to redefine a new index which shall thereby be incorporated
into the above revision formula.
11. PAYMENT SCHEDULE
For each part of the system, the payments shall be made upon completion of the
events set forth in the schedule of the Contract. The payment schedule is as
follows :
1. Central Site
1.1. Hardware Central Site and DEC and Oracle Software (capacity of
[*] terminals):
<PAGE> 74
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
<TABLE>
<CAPTION>
Event Signature of Delivery Functional Final TOTAL
Contract Acceptance Acceptance
<S> <C> <C> <C> <C> <C>
Percenta ~e [*]% [*]% [*]% [*]% 100%
Amount [*] [*] [*] [*] [*]
(FRF)
</TABLE>
1.2. SGI-NET- system ITGS [*] licenses for the software):
<TABLE>
<CAPTION>
Event Signature of Delivery Functional Final TOTAL
Contract Acceptance Acceptance
<S> <C> <C> <C> <C> <C>
Percenta ~e [*]% [*]% [*]% [*]% 100%
Amount [*] [*] [*] [*] [*]
(USD) 1
</TABLE>
1.3. Specific adaptations requested by FDJ:
1.4. Support team for the SGI project.
[*] of total price of the services, i.e., [*] USD upon delivery of the
System.
Then, [*] of the total price of the services, i.e., [*] USD, [*] months after
delivery of the System.
Then, [*] of the total price of the services, i.e., [*] USD, [*] months after
delivery of the System.
Then, [*] of the total price of the services, i.e., [*] USD, [*] months after
delivery of the System.
1.5. Training of La Francaise Des Jeux personnel
<PAGE> 75
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
The same Payment Schedule as adopted by SGI's project support team:
[*]% of total price of the services, i.e., [*] USD, upon delivery of the
System.
Then, [*]% of the total price of the services, i.e., [*] USD, [*] months after
delivery of the System.
Then, [*]% of the total price of the services, i.e., [*] USD, [*] months after
delivery of the System.
Then, [*]% of the total price of the services, i.e., [*] USD, [*] months after
delivery of the System.
2. Equipment at Retailer (SciScang)
2.1. SciScan@ Terminals
2.1.1. Terminals with player display ([*] units)
An advance payment corresponding to [*]% of the amount of the order, -i.e.,
[*] FRF, upon signature of the Contract.
Payment of the balance on the tenth of the month following a period of 30 days
from the receipt of the invoice to which the acceptance minutes are attached
(see Annex 19.
2.2. SciScan@ Software
<TABLE>
<CAPTION>
Event Signature of End of Delivery Delivery End of End of of TOTAL
Contract field Of the the Delivery Guarantee
acceptance 5,000th 10,000th Of the
SciScan@ SciScan@ SciScan@
0
<S> <C> <C> <C> <C> <C> <C>
Percenta [*]% [*]% [*]% [*]% [*]% [*]% 100%
Amount [*] [*] [*] [*] [*] [*] [*]
(USD) I
</TABLE>
3. Technical Assistance for the operation of the System:
Technical assistance shall be invoiced on a monthly basis depending upon the
services performed and payment shall be made on the tenth of the month following
a period of 30 days from the receipt of the invoice. Invoice and payment shall
be in US dollars.
<PAGE> 76
ANNEX 8: MAINTENANCE
8.1. Organization of relations between FDJ and SGI for the Maintenance of
hardware and Software relating to the System
a) Intervention requests by FDJ
These shall be notified to the extent they are required. In the event of an
emergency, they may be transmitted by facsimile. Information relating to
date/hour shall be recorded.
b) Registered receipt of assistance requests
For each intervention request, a registered receipt shall be automatically and
promptly sent to FDJ which shall include relevant date and time information.
c) Statements supplied at the end of assistance
Following each intervention, SGI shall furnish a statement of its intervention
describing:
- - the incident,
- - the diagnostic of SGI,
- - the maintenance service(s) carried out,
- - steps to be taken to remedy the incident,
- - recording of the information relating to date/hour.
In turn, FDJ shall communicate in writing to SGI the time period of total
breakdown of the System corresponding to this incident.
Statements shall be sent to FDJ by way of telecopy. In the event of emergency,
they may be communicated by telephone and confirmed by facsimile.
8.2 Maintenance of Software
The purpose of this Annex is to set forth the maintenance of Software supplied
under this Agreement, which shall include the following:
corrective maintenance; update maintenance; HOT LINE telephone support
(technical support).
8.2.1. Method of carrying out corrective maintenance
a) Available times for assistance requests
From Monday through Saturday between 8 am and 6 pm (Paris time)
<PAGE> 77
b) Timetable for assistance
The response time for SGI is defined as the period between the time of receipt
of the assistance request (indicated by the receipt of the facsimile) and the
time of repair (indicated by the receipt of the end of repair notice sent to
FDJ).
The incidents, pursuant to the Software guarantee, may be divided into three
groups:
(1) Block incidents
An anomaly shall be deemed to be a block when it results in the complete
impossibility to employ an application or functionality, or a block of more than
5% of the SciScan Terminals its use being blocked (engendering breakdown and a
cessation of service), and correction is required within 4 hours in accordance
with the provisions set forth below.
Taking account of the importance to FDJ of the correct functioning of the
System, in the event of a block incident, SGI shall be required to resolve the
technical problem within a maximum period of 4 hours from the assistance request
and supplying either a final solution or a bypass solution. Any such solutions
must comply with the functionality of the Software.
Subject to SGI's prior approval, FDJ reserves the right to intervene in the
event of a block incident, with respect to the strategic portion of the System
for the purposes of supplying a bypass solution. In this case, SGI is still
required to intervene within the 4 hours from the time of assistance request so
as to provide a solution. Any intervention by FDJ shall not terminate the
contractual warranties made by SGI. FDJ will notify SGI of its intervention as
soon as feasible.
If, owing to the exceptional nature of the block incident, SGI is not able to
resolve the technical problem within 4 hours, SGI shall use its best efforts to
provide a solution that conforms with the functionality of the Software as soon
as possible. In such event, if SGI shows proof that it has used its best
efforts, then it may resolve the technical problem within time limits exceeding
4 hours. If FDJ does not acknowledge that the incident is of an exceptional
nature, SGI shall be entitled to apply the arbitration procedure described in
Section 49.2 in order to determine whether or not the incident was exceptional.
(2) Non-Block incidents of non-conformity
Where the result is false, incomplete and not in conformity with the
specifications of the Software, but does not constitute a block, a solution must
be implemented by SGI within 15 days from the request for intervention made by
FDJ.
(3) Other Non-Block incidents
For other non-block incidents, a solution must be implemented by SGI within 45
days from the date that FDJ requests such intervention.
Whatever the nature of any incident, SGI shall be responsible for using all
useful and necessary means in order to resolve the technical problems
encountered by FDJ that are within the scope of the guarantee. This obligation
includes, notably, the appropriate technical solutions, qualified and competent
personnel, as well as a rapid execution of such responsibilities.
<PAGE> 78
In the event of disagreement between FDJ and SGI as to the schedule, it shall be
for SGI to resolve the technical problem within a maximum period of 45 days from
the date of notification of the breakdown by FDJ.
For whatever reason and whatever the nature of the technical problem, SGI shall
employ all useful and necessary means to resolve any technical problems
encountered by FDJ as soon as possible.
8.2.2. Methods of update maintenance
Update maintenance shall consist of implementing add-ons or modifications to the
applications under guarantee, for the purposes of modifying a management system
(application update), improving the user-friendliness or performance (perfecting
update) and to incorporate the evolution of the needs of La Francaise des Jeux
(technical update).
The methods are the following:
FDJ shall communicate a specification of requirements;
SGI shall respond within 20 business days giving a fee estimate in respect of
the updates and indicating the possible implications of implementation thereof
(i.e. in terms of performance, utilization and maintenance etc.); and
FDJ shall have 20 business days in which to either accept or refuse the
implementation of any such evolution or update by SGI.
8.2.3. Methods of telephone support
The working hours with respect to telephone support shall be identical to those
applicable to intervention requests under normal conditions.
SGI shall be required to put into place first level telephone assistance in the
French language which shall be manned by personnel who are sufficiently
qualified either to immediately respond or to call in appropriate other
assistance.
Telephone assistance may be carried out in the English language if acceptable to
the persons requiring assistance.
8.3. Maintenance of Hardware
With respect to hardware maintenance of the System, SGI shall supply to FDJ
replacement equipment in addition to spare parts and repair facilities.
(a) Available times for assistance requests
From Monday to Friday between 8 am to 6 pm (Paris time)
(b) Timetable for assistance
<PAGE> 79
The response time for SGI for the purpose of maintenance is defined as the
period between the time of receipt of the assistance request (indicated by the
receipt of the facsimile sent by FDJ) and the time on which SGI has fulfilled
its obligations in accordance with this Annex 8 (as indicated by the receipt of
the end of repair notice sent to FDJ).
(c) Description of maintenance
Only defective components or elements, to the exclusion of entire hardware,
shall be returned to SGI for repairs. The maintenance shall consist in the
repair or exchange of the defective component, in such manner that the hardware
shall always be in an acceptable state of functionality.
In any event, and of whatever the nature thereof, SGI shall employ all necessary
means so as to resolve technical problems encountered by FDJ. Such obligation
shall include, but not be limited to, appropriate technical solutions, competent
and qualified personnel in addition to rapidity of execution of its obligation.
The exchanged piece need not be new, but must be fit for the purpose for which
it is intended. The repossessed piece shall become the property of SGI.
Replacement, labor and transport costs shall be borne by SGI.
SGI shall put into working order the defective hardware as follows:
within four (4) business hours for hardware for the central site set forth in
Annex 2.
within two (2) business days for other hardware provided by SGI and described in
Annex 2, following fax confirmation of a telephone call addressed to SGI during
the aforementioned hours on a business day.
I
In order to put hardware back into working order, SGI may, depending on the
information given to it, either:
- - give to FDJ, by telephone, a solution capable of remedying the breakdown or
fault;
- - to go on-site to proceed with the necessary repairs; or
- - to decide upon any other solution which it considers appropriate to the
circumstances.
8.4. Penalty
In the event that there is a total breakdown of the System for more than 0.05%
of running time per year, FDJ can claim penalties from SGI in the amount of FF.
7,000 HT per hour that exceeds this authorized down time. In any event, these
penalties shall not exceed the fees of SGI for the annual maintenance of
hardware and software.
<PAGE> 80
Breakdown is defined as the time limit within the hour of issuance of the
intervention request made by FDJ and the hour from which all the users can use
the entire System.
8.5. Exclusion from Maintenance
The following are excluded from the maintenance of Software and hardware
provided by SGI hereunder:
Breakdown or dysfunction due to improper use of hardware or Software or
noncompliance with user or installation instructions;
Breakdown or dysfunction due to an external cause (including, but not limited
to, knocks, breakages, humidity, accident, water or other liquid damage,
lightning, short-circuit, power supply faults, acts of vandalism, theft or
attempted theft, defective lines);
- - Normal wear and tear of hardware and its accessories;
Breakdown or dysfunction caused by one or several modifications or add-ons made
to hardware without the written consent of SGI;
Damage due to failure to maintain in accordance with the user manual or lack of
surveillance or care;
Damage resulting from repairs or maintenance carried out by non-SGI approved
persons;
Breakdown or damage caused by the use of consumables other than those
recommended by SGI; in the absence of recommendation, FDJ shall be free to use
the consumables;
- - Deterioration following or due to insufficient packaging and/or poor
condition of equipment returned to SGI;
- - Transmission breakdowns (telecommunication network) including, but not
limited to, bad geographical coverage by radio-electrical transmitters,
interference linked to weather conditions, or faulty telephone lines;
- - Defects caused to hardware by bad environmental conditions; and
Breakdown or damage resulting from one or more modifications of all or part of
the System without SGI's prior consent.
SGI shall not be required to provide the foregoing maintenance services as long
as the equipment required for the use of the Software is unavailable, provided
that such unavailability does not result from a breach of SGI hereunder.
<PAGE> 81
Where the request for intervention addressed by FDJ is not attributable to a
deliverable made by SGI, (hardware, Software, etc.), SGI shall be entitled to
invoice in accordance with its rates in force at the time of intervention,
displacement costs not being included therein, after having demonstrated to FDJ
that the intervention is not attributable to a deliverable by SGI.
<PAGE> 82
ANNEXE 9: ENGAGEMENT DE PERFORMANCE
1. This annex defines the performance requirements that have to be met by
the hardware and software of the primary and back-up of the central
system both independently of each other and jointly as well as in
connection with the terminals subject to this contract.
2. The following data exist for the measurements of the performance
obligations with regard to the on-line transaction processing:
Number of SciScan terminals connected to the central system
(mode of connection indicative only): via ISDN at the on-line
retailers via ISDN at the courtiers via dial-up network at the
off-line retailers The maximum total number of on-line terminals that
can be operated on the contractual hardware and on which performance
tests shall be based is
3. The following transaction response times shall have to be met with
regard to the on-line transaction processing:
<TABLE>
<CAPTION>
Transaction type Handling Processing Transmission Processing Total Total
time time time network time processing processing
SciScan SciScan SGI-NET time & print time & print
online dial-up
<S> <C> <C> <C> <C> <C> <C>
On-line instant-game-validation
transaction (I ticket only)
Max. 1.00 sec. 5.00 sec. 12.00 sec.
Avg. 0.25 sec.
Online instant-game validation-batch
transaction (maximum 30 tickets)
Max. 8.00 sec. 15.00 see. 20.00 sec.
Avg. 2.00 sec.
Sign-On miuction
Max. 10.00 sec. 20.00 sec. 20.00 sec.
Avg. 3.00 sec. I
Sign-Off transaction
Max. 3.00 sec. 10.00 sec. 10.00 sec.
Avg. 1 .00 sec.
Remise Courtier report transaction
Max. 12.00 sec. 20.00 sec. 20.00 sec.
Avg. 6.00 sec.
Instant-game receive or activate pack
transaction (I pack only)
Max. 1.00 see. 6.00 sec. 12.00 sec.
Avg. 0.25 sec. I
Instant-game check-in pack from
warehouse transaction at warehouse
Max. 1,00 sec. 3.00 sec.
Avg. 0.25 sec.
</TABLE>
The figures listed as "Max." are defined as "short load peaks". The
figures listed as "avg." define the performance of a "continuous load".
<PAGE> 83
4. The following throughput requirements shall have to be met with regard
to the on-line transaction processing:
<TABLE>
<CAPTION>
Transaction type Transactions/sec.
<S> <C>
Online instant-game-validation transaction (I ticket only):
Max. 130 t/sec.
Avg. 80 t/sec.
Online instant-game-validation batch-transaction (max. 30 tickets)
Max. 5 t/sec.
Avg. 1 t/sec.
</TABLE>
The figures listed as "Max." are defined as "short load peaks". The
figures listed as "avg." define the performance of a "continuous
load". All necessary batches, reports, downloading and maintenance can
be carried out without any impact on the 'Max.' figures
5. The following minimum performance requirements have to be met with
regard to the data volume to be processed:
<TABLE>
<CAPTION>
Criteria Required quantity
<S> <C>
Number sold instant tickets/year max. 2.600.000.000
Number sold instant packs/year max. 26.000.000
Percentage of winning tickets/year approx. 25% of sold instant tickets
New games per year up to 10
Selling period of an emission 3 months to 1.5 years
Validation expiration time after end of selling 3 months
period of an emission
Active games at a given time max. 30
Simultaneous emissions/game 2 to 3
Number of tickets/emission max. 350.000.000
Retention time for online accounting records max. 5 weeks
Number of switched virtual circuits per Front max. 4.000
End Processor
</TABLE>
6. The system can be expanded to a maximum of 50.000 terminals by means
of an extension of the number of double FEPs on both primary and
back-up subsystems only (each additional double FEP on both sub
systems can support an additional 8,000 terminals) and software
licenses. Furthermore, an annual increase of 5% in the data volume,
related to an average system service life of 5 years, can be achieved
by extending disc space only.
<PAGE> 84
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
7. The Sciscan terminal has the following performance:
<TABLE>
<CAPTION>
Criteria Required quantity
<S> <C>
[*] [*]
[*]
[*]
</TABLE>
<PAGE> 85
ANNEX 10: REPRESENTATIVES OF THE PARTIES AND MEMBERS OF
PROGRESS COMMITTEE
<TABLE>
<S> <C>
For FDJ:
principal coordinator: Bruno MOYRAND
assistant coordinator: Remi THEYS
For SGI:
principal coordinator: Tyler M. RYAN
assistant coordinator: Christian RADAKOVITS
</TABLE>
<PAGE> 86
ANNEX 11 : CONDITIONS FOR SYSTEM OPERATION ASSISTANCE
11.1 SGI shall assist FDJ in the operation of the system in VITROLLES. SGI
shall take the necessary steps so that FDJ may operate the System on a
continuous basis. Accordingly, SGI shall be responsible for providing
the necessary qualified personnel to carry out the technical
operations and the maintenance of the System in VITROLLES.
The operation of the system includes all of the maintenance services
described in Annex 8.
SGI's personnel must have very strong technical skills.
Furthermore, in order to assure a minimum of communication, the
personnel's knowledge of the English language must be of a good level
and their ability to express themselves in the French language must be
readily acceptable.
11.2 The SGI personnel assuring the operational assistance shall not change
during the entire period of the assistance. During absences of the
personnel (i.e., vacation or sick leave), SGI shall furnish
replacement personnel having at least the same abilities. For schedule
absences, and in order to assure a continuity of service, the
replacement shall assume its responsibilities at least three (3)
business days before the departure of the personnel being replaced.
The same condition shall apply for the return of the concerned
personnel.
11.3 If the personnel furnished by SGI does not have the sufficient and
necessary qualities to carry out the assistance provided for in good
condition, FDJ shall notify the same to SGI by certified mail return
receipt requested.
SGI shall then furnish, within a maximum period of five (5) business
days, the personnel having the required competencies.
The "replaced" personnel shall continue its mission with FDJ for up to
three (3) business days after the arrival of his/ her replacement.
11.4 SGI shall furnish to FDJ the personnel capable to carry out the
maintenance operations as described in Annex 8. They must also be able
to carry out all the technical operations concerning the management of
the system, applications of the automated system management of the
instant lottery games (SGI-NET), as well as the support of FDJ's game
organization, including:
1/ All technical operations corresponding to the material and to
all the System software components (SGI-NET).
2/ Operation and administration of all hardware components of
LAN connecting the components of the System.
3/ Management and optimization of the DIGITAL and ORACLE
software.
4/ Installation, optimization and permanent availability of the
System software for the operation of the FDJ games.
<PAGE> 87
5/ Processing management by lot and supervision of the System
SGI-NET.
6/ Installation and management of new versions of DEC, ORACLE
and SGI-NET software.
7/ Management of the configurations for the hardware and
software furnished by SGI.
8/ Management and administration of saving backup copies of the
data.
9/ Maintenance of an up-to-date register containing any
dysfunction or particular occurrences having an impact on
operations.
10/ Management of the privileges for all network access (i.e., LAN
and WAN) to the SGI-NET System, for all DEC, ORACLE and
SGI-NET software users.
ll/ Management of consumables necessary for operations.
12/ Drafting and updating of the operating procedures and the
administration of the System and applications.
13/ Training of FDJ personnel for the operation and administration
of the System and the applications.
11.5 The personnel furnished by SGI under the framework of this assistance
shall carry out all of its mission on the FDJ site in VITROLLES and
shall therefore respect the access conditions:
The SGI personnel shall have free access to the site of the System operations.
11.6 The SGI personnel present on the FDJ site at VITROLLES shall be the
privileged representative to FDJ.
For all requests for intervention, FDJ shall be referred to this person, who
will decide the course of action:
direct intervention of the SGI on-site personnel rerouting of the intervention
request to SGI-Austria.
in order to assure the level of quality of necessary services, the SGI
personnel present on the VITROLLES site must be able to be contacted 24 hours a
day to treat solely block incidents.
11.7 To carry out this assistance, SGI shall furnish to FDJ:
2 people during the first 6 months one of the two people
during the 6 months following.
Three (3) months before the end of this second period, FDJ may request
in writing the extension of this assistance, in return for a payment
of this service in accordance with the provisions herebelow, for a
period of six (6) months, renewal by tacit agreement upon three (3)
months notice.
11.8 For a period of six (6) months, the cost corresponding to the presence
at VITROLLES of an SGI person having the abilities described above, is
defined in Annex 7.
This amount includes all the associated with this assistance.
<PAGE> 88
ANNEXE 12: MODELE DE PERFORMANCE BOND
<PAGE> 89
Bond No.
PERFORMANCE BOND
Conforms with The American Institute of Architects
A.I.A. document No. A-311
KNOW ALL BY THESE PRESENTS: that
as Principal, hereinafter called Contractor, and,
is Surety, hereinafter called Surety, are held and firmly bound unto
as Obligee, hereinafter called Owner, in the amount of
for the payment whereof Contractor and Surety bind themselves, their heirs,
executors, administrators, successors and assigns, jointly and severally,
firmly by these presents.
WHEREAS,
Contractor has by written agreement dated entered into a contract
with Owner for
in accordance with Drawings and Specifications prepared by
which contract is by reference made a part hereof, and is hereinafter referred
to as the Contract.
Page I of 2
1:2-t
<PAGE> 90
PERFORMANCE BOND
NOW, THEREFORE, THE CONDITION OF THIS OBLIGATION is such that, if Contractor
shall promptly and faithfully perform said Contract, then this obligation shall
be null and void; otherwise it shall remain in full force and effect.
The Surety hereby waives notice of any alteration or extension of time
made by the Owner.
Whenever Contractor shall be, and declared by Owner to be in default
under the Contract, the Owner having performed Owner's obligations thereunder,
the Surety may promptly remedy the default, or shall promptly
1) Complete the Contract in accordance with its terms and conditions, or
2) Obtain a bid or bids for completing the Contract in accordance with its
terms and conditions, and upon determination by Surety of the lowest
responsible bidder, or, if the Owner elects, upon determination by the Owner
and the Surety jointly of the lowest responsible bidder, arrange for a contract
between such bidder and Owner, and make available as Work progresses (even
though there would be a default or a succession of defaults under the
contract or contracts of completion arranged under this paragraph) sufficient
funds to pay the cost of completion less the balance of the contract price; but
not exceeding, including other costs and damages for which the Surety may be
liable hereunder, the amount set forth in the first paragraph hereof The term
"balance of the contract price," as used in this paragraph, shall mean the
total amount payable by Owner to Contractor under the Contract and any
amendments thereto, less the amount properly paid by Owner to Contractor.
Any suit under this bond must be instituted before the expiration of
two (2) years from the date on which final payment under the Contract falls
due.
No right of action shall accrue on this bond to or for the use of any
person or corporation other than the Owner named herein or the heirs,
executors, administrators or successors of the Owner.
Signed and sealed this day of
(Seal)
(Witness) (Principal)
(Title)
(Seal'
(Witness) (Surety
(Title
Page 2 of 2
<PAGE> 91
ANNEX 13: SUB-LICENSES FOR THE USE OF SOFTWARE
Sub-License contract for the ORACLE software
Concluded between
LA FRANCAISE DES JEUX
(hereafter "Holder")
AND
SCIENTIFIC GAMES INTERNATIONAL
(hereafter "SGI")
By this Agreement, SGI grants to Holder a sub-license for the ORACLE
corporation software system, appearing on the list of Annex 3 and connected to
the application software (integrated programs), in order to be used exclusively
on the hardware specified in Annex 2 and in accordance with the provisions
hereafter:
1. Each sub-license grants to Holder the right to use the integrated program on
the central processing units (" unites centrales (UQ ") under the license. The
central processing units must be specified during the sub-license agreement.
The Holder must declare the exact site address of the central processing units.
In case of a dysfunction or backup system test, the temporary use of the
programs, or their permanent transfer to another central processing unit is
authorized, if deemed appropriate. In the event of a permanent transfer, this
will be permitted subject to a preliminary inquiry.
2. Each Holder shall only use the ORACLE integrated program for the purpose of
serving the application program furnished by SGI with the integrated program.
The Holder shall not be authorized to change technicians, to decompile or
disassemble the integrated programs themselves, nor to have such acts carried
out by third parties, except if ORACLE gives its written authorization and if
the activities mentioned do not violate the Directives of the European Union
with respect to the protection of software.
3. The Holder recognizes that the programs under the license, and in particular
the integrated ORACLE program and the relevant documentation which might be
supplied to the Holder, containing commercial secrets and protected copyrights
belonging to ORACLE corporation. The Holder shall not reproduce, in part or in
entirety, the integrated program, nor have it reproduced by third parties, nor
divulge the contents to third parties, or otherwise shall be in breach of these
provisions.
<PAGE> 92
4. The rights granted to the Holder shall not be assigned or transferred to
third parties. No other sub-license shall be accorded for the integrated
program. Supplementary licenses shall be granted instead. SGI shall not
transfer to the Holder any intangible property right to the ORACLE programs.
The Holder shall not conclude leasing agreements concerning the integrated
program.
5. The Holder accepts to not hold ORACLE liable for damages resulting
therefrom, directly or indirectly, of the application of the integrated
program. Upon expiration of the sub-license, the Holder shall cease using all
programs, documentation and program backup copies and confirm to SGI the
cancellation or destruction of all programs. This condition shall also be
applied to the documentation.
6. The Holder shall not be authorized to publish the results of the evaluations
tests executed with the program.
7. The Holder shall not have the right to transfer the programs under the
license in the territory other than that determined in this Agreement. The
Holder shall respect all provisions with respect to the Commerce Department and
the exporting agencies of the United States in order to not export the programs
in an effort to bypass the legal provisions in force.
8. All liability concerning the use of the ORACLE programs with the used
software packages of the planning, production, the control and the surveillance
of the nuclear sites, or those used in aviation, shall be rejected.
Neuilly-sur-Seine, the 30th of September 1998
<PAGE> 93
Sub-License contract for the DIGITAL software
Concluded between
LA FRANCAISE DES JEUX
(hereafter "Holder")
AND
SCIENTIFIC GAMES INTERNATIONAL
(hereafter "SGI")
By this Agreement, SGI grants to Holder a sub-license for the DIGITAL EQUIPMENT
software system, appearing on the list of Annex XX , in order to be used
exclusively on the hardware specified in Annex XX and in accordance with the
provisions hereafter:
1.The software should only function on a "machine sous license". The "machine "
is defined as follows:
a) If the software to be sub-licensed is ordered at the same time as an
equipment or system configuration, the "machine sous licence"
designates the furnished according to the order.
b) If the software is ordered independently of an equipment or system
configuration, the term "machine sous licence" designates the machine
on which the software is initially installed according to the right
granted under the sub-license.
C) In case of licenses intended for a group of Systems of virtual memory
(VMS), the term "machine sous licence" includes each processor of a
VMS group functioning with the software product of the VMS group.
2. The license relative to the software only permits the Holder to use the
version under the concerned license, by the stipulated number of users (or by
the persons explicitly mentioned) for whom the software was intended to be
licensed. The version under license, the number and, if specified, the names of
the persons having the right to use the software, shall be determined by
DIGITAL EQUIPMENT CORPORATION Ltd ("DIGITAL EQUIPMENT"), who grants the
licenses.
3. The "Cle d'Autorisation du Produit Logicier' (PAK) supplied by the lessor of
the license of the partner distributor constitutes an integral part of the
software. Its use is subject to the sub provisions of the sub-license being the
object of an agreement and stated in this document.
<PAGE> 94
4. The Holder shall respect all the components of the software under license
which restricts access to the non-authorized software and shall not modify them
nor put them knowingly out of service.
5. All industrial property rights, and in particular the copyrights relative to
the software, belong exclusively to DIGITAL EQUIPMENT. The Holder shall not
have the right to use, employ, copy or modify the software in another manner
than that stipulated by the provisions of this agreement, nor to transfer the
software to a third party. This is applied equally to the information included
in the PAK.
6. The Holder shall not use a procedure, whatever it may be, intended to
recreate, totally or partially, the source programs from the binary software,
nor to obtain the knowledge on the conception or the creation of the software
or hardware or on the updating of the software microprograms.
7. The updates and the new version may only be used in the framework of a
license granted separately or in accordance with the stipulations of an
software maintenance agreement concluded with the Holder.
8. The software licenses are granted personally and non-exclusively and are
only transferable after prior explicit consent of DIGITAL EQUIPMENT. The Holder
may only grant to his employees and agent the access to the software as
necessary for the exercise of the rights of the sub-license of the Holder.
9. For the products needing he use of the PAK, the duty to retain the
recordings shall be respected in entering the PAK license data in the "Service
de Gestion de la Licence" ("LW') and in preserving the PAK. The Holder shall
otherwise be liable to keep the recordings of the software under license,
including its version, the series number of the "machine sous licence", the
site of the software under license and the number of executed copies.
If, during the period of this Agreement, it is suspected that the software has
been transmitted to third parties or used on a non-authorized machine, the
Holder shall return the recordings back to DIGITAL EQUIPMENT.
In the event that the Holder shall fail to return the said recordings, he shall
allow DIGITAL EQUIPMENT to access the processors and its accounts in order that
DIGITAL EQUIPMENT may determine if the software is used in accordance with the
provisions of this Agreement.
10. DIGITAL EQUIPMENT may only terminate the software license for an important
reason. An important reason shall be, in particular, the non-observance of the
provisions of this agreement by the Holder.
The Holder may terminate the software licenses in writing at the end of each
payment term with ninety (90) days notice.
Termination of this agreement by DIGITAL EQUIPMENT or by the Holder shall make
reference to all versions of the software supplied to the Holder and shall
include all the copies of these versions.
The memory supports supplied to the Holder by the distribution may contain a
software by which the distribution partner and/or the Holder do not hold a
license. In the event that the Holder should wish to use this software, he must
sign a corresponding sub-license agreement.
Neuilly-sur-Seine, the 30th of September 1998
<PAGE> 95
ANNEXE 14: MATERIELS ET SERVICES OPTIONNELS
1. This annex contains optional equipment, software and services for
the Instant Lottery Computer Management System and similar subject
areas.
2. The placing of an order for any of these options requires a
written amendment to this supply agreement. The prices stated in this
annex shall be valid for three months from the date of signature of
contract.
3. Printer equipment for the computer center:
<TABLE>
<CAPTION>
Pos. qty. Description
<S> <C> <C>
1 2 40 ppm Computer Center Printer
32MB Main Memory
Duplex Option
Resolution 6OOx6OO dpi
PCL5e and Adobe Postscript Level 2
A5, A4,A3 paper format
</TABLE>
3.1 FDJ shall provide the following for the printer's rooms :
<TABLE>
<CAPTION>
No. deliverable/service/requirement
<S> <C>
I Provision of a printers' rooms for the setting up of I
printer at each location with a footprint of 58,5 x 64,0 cm
each.
2 Creation of a Ethernet data line between the data centers and
the printers' room.
</TABLE>
3.2. The total price of this option that will be detailed is as per annex 7.
4. Additional equipment required for the work places in the FDJ
departments
4.1. The work place computers, LAN servers, printers and network components
for the connection of the below FDJ locations shall be determined
together by FDJ and SGI and then proposed by SGI to FDJ in the
framework of an individual order outside this contract :
i.) Central warehouse in Fosses
ii.) Settlement of accounts in Moussy-le-Vieux
iii.) High-tier prize payment in Moussy-le-Vieux
iv.) Marketing et Relations Joueurs in Boulogne
V.) Direction Financiere in Neuilly sur Seine
11-1 /
<PAGE> 96
5. Development system
5. 1. Hardware Description Development System
<TABLE>
<CAPTION>
Pos. Qty. Description
<S> <C> <C>
1 1 AlphaServer 800 5/500
Main memory 512 MB
I CPU
2(1) 1 EIS A / Ethernet adapter
3 1 4.3GB UltraSCSI disk for page/swapfiles
4 1 19" Cabinet
5 1 PCI / UWSE adapter to connect tape
6 1 35GB DLT tape
7 2 PCI / UWD adapter to connect disk subsystem
8 1 Disk subsystem, containing
3 x StorageWorks Container
7 x 4.3GB UItraSCSI disks
7 x 9. IGB UltraSCSI disks
9 1 Console Terminal
10 8 PC Pentium III
64MB
17" Monitor
Ethernet adapter
board
11 1 17ppm laser printer
12 1 .32-Port Ethernet 1OBase Switch
</TABLE>
<PAGE> 97
5.2. Software Description Development System
<TABLE>
<CAPTION>
Product Short Description Qt Qty Installation Distribution Source License Version
Y/ total Type
Sy 1 done Media Code
s by Delive
ry
<S> <C> <C> <C> <C> <C> <C> <C> <C>
OpenVMS Base Operating System Base License for 1 1 SGI CD-ROM no BASE V7.1-IHI
License AlphaServer Systems
Enterprise Additional Products for the 1 1 SGI CD-ROM no BASE V7.1-IHI
Integration operating system
Package
OpenVMS User Operating System User License n/ 8 SGI n/a n/a CONC V7.1-IHI
License a
ORACLE Oracle Enterprise Edition n/ 8 SGI CD-ROM no FULL V7.3.2.3.2
RDBMS a USE
DEC PASCAL DEC PASCAL compiler n/ 1 SGI CD-ROM no TRAD V5.6
a
DECset DECset Development Tools n/ 1 SGI CD-ROM no TRAD V12.0
CMS Code Management System a
MMS Module Management
System
LSE .. Language Sensitive Editor
ORACLE Oracle Developer System n/ 8 SGI CD-ROM no FULL V2.1
Developer 2000 a USE
SGI Development Tools developed by SGI for the n/ 8 SGI Tape no CONC ?
Tools development of SGI-NET a
</TABLE>
<PAGE> 98
5.3 FDJ shall provide the following deliverables for installation of the
development system :
<TABLE>
<CAPTION>
No. deliverable/service/requirement
<S> <C>
I Provision of location in the computer center for the setting up of the
development system footprint of 60cm x 90cm.
Location(s) for installing 8 standard mini tower PCs with 17" monitors
and one desktop laser printer
2 Creation of a ethernet data lines between the data center, the
development system and the 8 PC workplaces.
3 Creation of a single-phase electric circuit to the development system,
over current protection with a minimum of 16 Amp. (action-delay fuse),
a maximum voltage fluctuation of +/-7% and a maximum frequency
fluctuation of +/-1%.
5.4. The total price of this option that will be detailed is as per annex 7.
6. Expansion of SGI-NET ITGS license for further SciScan connections.
FDJ shall be obligated to immediately inform SGI in writing about any increase
of the number of retailer terminals connected to the System. In case of any
increase of connected retailer terminals SGI is entitled to receive an
additional license fee as per annex 7.
7. Training pertaining to central system software development
As per annex 7.
</TABLE>
<PAGE> 99
ANNEXE 15: RESEAU DE TELECOMMUNICATION
La presente annexe a pour objet de specifier le reseau de telecommunication
contractuel propose par FDJ et accepte par SGI pour assurer dans les meilleures
conditions de performance, de securite et de cout, la connexion entre les
terminaux et le site central.
<TABLE>
<S> <C>
1. CARACTERISTIQUES TELECOM DU RESEAU FORTUNA ...............................................................2
1. 1. SPECIFICATIONS TECHNIQUES DU RESEAU FORTUNA ...........................................................2
1.2. LES DIFFERENTS MODES DE RACCORDEMENT ...................................................................2
1.2. 1. MODE 1 : raccordement au travers d'une passerelle supportee par le terminal IJ.100 ..................3
1.2.2. MODE 1 bis: secours RTC du raccordement au travers d'une passerelle supportee par le
terminal IJ100 et ...................................................................................5
1. 2.3. MODE 2 : raccordement RTC sur acces reserves FDJ ....................................................6
1. 2.4. MODE 3 : acces direct permanent .....................................................................7
1.3. RACCORDEMENTS SITE CENTRAL PRIMAIRE ET DU SITE DE BACK-UP ..............................................8
1.4. RACCORDEMENTS DU SITE CENTRAL PRIMAIRE AU SITE DE BACK UP ..............................................9
</TABLE>
<PAGE> 100
1 1. CARACTERISTIQUES TELECOM DU RESEAU FORTUNA
Le reseau Fortuna repose sur la norme X25 et se caracterise principalement par:
- un traitement temps reel pour la plupart des fonctions, et
notamment des fonctions utilisateurs.
- une haute fiabilite , les transactions ne doivent etre ni
perdues, ni dupliquees et cela quel que soient les
circonstances dans lesquelles elles sont effectuees.
- une haute disponibilite, la continuite de service doit etre
assuree.
- un haut degre de performance, le traitement d'une operation
temps reel doit etre court et le nombre d'operations
simultanees supportees important.
1. 1. Specifications techniques du reseau Fortuna
Le reseau Fortuna doit repondre aux specifications de l'operateur TRANSPAC
consignees dans un ensemble de documents de reference appelees S.T.U.R 1994.
S.T.U.R = Specifications Techniques << Utilisation du Reseau de l'annee 1994
Les S.T.U.R 1994 dans leur version CD ROM ont ete fournis en reunion le 17/09/98
a Vitrolles. Les references utiles sont disponibles dans les tomes suivants
TOME 1 : presentation generale
TOME II: acces direct synchrones X25
TOME HI: acces indirects synchrones
TOME V : acces par le canal D du RNIS
1.2. Les differents modes de raccordement
3 modes de raccordements ont ete retenus pour le raccordement des terminaux
SciScan. Ils sont decrits dans les paragraphes suivants:
<PAGE> 101
1.2.1.1.Descriptions
1- le terminal SciScan est raccorde au terminal U100 par une liaison serie
2- le terminal IJ 100 est connecte au reseau par un port X25 synchrone le port
X25 synchrone se trouve sur une carte de communication (carte ARN)
caracteristiques de l'interface
vitesse: 9600 bits/s
temporisateur 1600
fenetre: 3
mode paquet
- nombre de VL 8
- longueur paquet: 256
- fenetre : 2
- classe emission/reception : 10/10 (9600 bits/s)
10 negociation classe de debit: oui
3- l'acces au reseau X25 TRANSPAC s'effectue grace a l'utilisation d'un
adaptateur X25/NUMERIS ou par un CLE 103 (adaptateur canal D multi- port X25) Le
detaillant dispose d'un boitier TNR (ternminaison numerique de reseau) qui
recoit le bus S. Chaque adaptateur dispose d'un numero de TEI (terminal element
identification) fixe. Plusieurs TEI sont possibles sur un meme point de vente Le
transport des paquets s'effectuent sur le canal D de NUMERIS a 9600 bits/s
<PAGE> 102
4 - dans le cadre de Fortuna, le terminal IJ 100 utilisera une seconde voie
logique (VL)
5- l'acces au reseau X25 a partir de NUMERIS s'effectue par un PAP ( point
d'acces paquet)
6- Transpac est un operateur specialise dans le transport des donnees en mode
paquet X25 Transpac garantit le transport des donnees en moins de 250 ras
7- les Lignes X25 du site central de La Francaise des Jeux arrivent sur des
commutateurs X25 situes en 3 lieux geographiques distincts Marseille St Mauront:
3 commutateurs Marseille Ste Marguerite: 1 commutateur Aix: 1 commutateur
8 - 3 supports empruntent des chemins distincts et sont utilises pour le
raccordement du site central vers Transpac chaque ligne utilise simultanement en
concurrence 2 supports pour acceder a Transpac les supports sont : fibre optique
cuivre hertzien
9- Le site de La Francaise des Jeux est equipe de deux locaux distincts. chaque
local distribue une partie des lignes X25 a 64kbits/s chaque local gere la
desserte France Telecom / Transpac de 2 supports
10 - les lignes X25
interface
e interface X21/VI 1
e vitesse: 64kbits/s
parametres raccordement
trame
- procedure LAP B
- temporisateur: 0800
- fenetre: 7
paquet
- fenetre: 2
- longueur paquet 256 octets
- nombre de CV : jusqu'a 4096
- format X25/84: non
- negociation classe fenetre/paquet non
- negociation classe de debit: oui
- classe debit emission / reception 13 / 13
(64kbits/s)
services complementaire
GFA: 0 local mixte
1 local mixte
<PAGE> 103
1.2.2. MODE 1 bis: secours RTC du raccordement au travers d'une
passerelle supportee par le terminal IJ100 et
1.2.2.1.Description
En cas de defaillance d'un des elements suivants: e canal D 0 adaptateur, 0 bus
S 0 TNR, a NUMERIS 1- Le terminal U100 dispose du modem RTC sur la carte ARN Le
secours du SciScan est assure par l'intermediaire du RTC au meme titre que le
U100
<PAGE> 104
1.2.3.1.Descriptions
Le terminal SciScan est connecte directement au reseau telephonique
1 - acces au reseau Transpac par l'intermediaire du reseau telephonique commute
- respect de la norme X32
2 - N' de telephone unique
- reconnaissance automatique de la vitesse du modem
- numerotation DTMF conforme a l'avis V25bis
3 - Acces Transpac dedies et dans un groupe ferme d'abonne (GFA~
- organisation actuelle des portes par zone geographique
- vitesse des acces dedies jusqu'a 9600 bits/s
- le nombre de portes est proportionnel aux nombres de terminaux
<PAGE> 105
1.2.4..Descriptions
Le terminal SciScan est relie sur un acces Canal D (de la meme maniere qu'un
terminal U100 dans le cas du mode 1).
1- le terminal dispose d'un port X25/synchrone en V24/V28.
<PAGE> 106
1.3. Raccordements Site Central primaire et du site de back-up
1.3.1.1.Descriptions
Sur le site central (primaire et back-up), l'activite reseau est geree par les
frontaux de communications.
Le dimensionnement des frontaux est conditionne par le nombre de raccordements
et de circuits virtuels necessaires pour l'utilisation simultanee de l'ensemble
des acces tern-unaux. Le nombre de circuits virtuels est la somme du nombre de
terminaux en acces directs et du nombre d'acces RTC reserves.
Dans la phase 1, le nombre de circuits virtuels necessaires est de
l'ordre de 12000.
Dans la phase 2, le nombre de circuits virtuels necessaires est de
l'ordre de 18000.
La repartition de charge est geree par les frontaux pour les circuits virtuels
sortants, Transpac assure la repartition pour les circuits virtuels entrants.
Pour une meilleure securite, les acces reseau Fortuna sont dans un Groupement
Ferme d'Abonnes.
La repartition physique des acces entre les frontaux et les commutateurs
Transpac est organisee de maniere a assurer un minimum de perturbation en cas de
defaillance d'un composant (frontal, lien physique, commutateur Transpac). En
fonctionnement normal, la charge telecom est repartie sur l'ensemble des
liaisons de tous les frontaux configures, y compris ceux de la configuration de
secours (liaisons groupees generalisees).
<PAGE> 107
1.3.1.2.Restriction
Sur incident, compte tenu du nombre important de CV entrants, il sera necessaire
de desynchroniser ou de trouver une autre solution appropriee, pour retablir
dans des conditions acceptables par l'operateur et par le site central, les
appels des terminaux SciScan.
1.4. Raccordements du site central primaire au site de back up
Une preconisation sera a fournir par SGI. Si l'operateur telecom n'est pas en
mesure de satisfaire les besoins exprimes, FdJ ainsi que SGI rechercherons avec
l'operateur telecom. une solution alternative. Ce choix devra etre valide et
accepte par l'ensemble des parties.
<PAGE> 108
ANNEX 16: SYSTEM DOCUMENTATION AND TRAINING
The object of this Annex is to describe the training, documentation and the
minimal presentations supplied by SGI to FDJ within the scope of the agreement
price in a manner sufficient to allow the operations team of the Network and
Production Department to acquire a real mastery and assure the efficient running
of the system, in its environment and of the SGI.NET ITGS application, that the
teams of the terminal can parameterize the software and the Lottery Department
can design compatible games with the SciScan technology.
All the modules (i.e., training , documentation, presentation) must be carried
out in the French language unless otherwise explicitly agreed in writing by FDJ.
1.1 CENTRAL SITE FIELD
In the central site field, SGI and FDJ include, without a particular statement
being necessary, all documentation and training for the following fields.
- - Supervision of the Games
- - Warehouse
- - Hot-line
- - Audit
- - Commercial statistics (i.e., FDJ and sales network)
1.1. TRAINING SUPPLIED BY SGI
SGI shall assure the training for a period and with a sufficient content to
train a reasonable number of users to allow FDJ to operate the system under the
same conditions of security and efficiency than those of the present system;
conditions that SGI knows.
A. System
System architecture
- components and peripherals
- Front part (FEPs)
- Back part (BEPs)
- - Protocols used (i.e., Betnet 5.0, etc.)
VMS operation system
- commands, messages
- specific tools (i.e., Unicenter, Polycenter, etc.)
- Software used
- System environment
- Network
<PAGE> 109
- Their function
The clusters (i.e., mechanism, availability, recovery, etc.)
*Database (i.e., ORACLE, etc.)
B. Administration of the Application
- - Detailed presentation of processing
- - Detailed presentation of the procedures
- - Description of the processing (i.e., MCT)
- - Interface specifications
- - Conceptual models of the data (i.e., MCI)
- - Simplified models
C. Application
Applicative architecture on the front part on the back part
Applicative modules
- their function
- The ability to be traced, filing, audit, etc.
1.1 DOCUMENTATION SUPPLIED BY SGI
All the documentation is to be furnished in 5 copies as well as a copy of the
magnetic support so that FDJ can edit others from them at its convenience. By
exceptional derogation, the documentation relative to the system of operation
(VMS) may be supplied in the English language, if, and only if, it is not
available in the French language from the manufacturer. The list of
documentation hereafter is not limiting or exhaustive.
A. System
The Hardware documentation
Documentation of the operating system VMS Message and code
documentation Procedures to stop and restart the system System
characteristics
-electric
-thermal dissipation
*etc.,
-Characteristics of the LAN and WAN network of their connections
B. Application
The document(s) for operating the SGINET containing: the name of each program
the nature of processing
<PAGE> 110
the accessed files the chaining of the programs the data flux
- - The processing monitor or the scheduler
- - The procedures for resuming processing in case of error
- - Control procedures
- - The escalation procedures
- - The procedures for stopping and restarting the application
- - The procedures for the introduction and putting into production
- - The indicators
These themes shall be detailed notably in the following documents:
- - General Design Manual which gives notably to the reader an overall
understanding of the structure and the functioning of the applied software of
the central site.
- - IHM Manual which contains the description of the user
screens, explaining notably their purpose, functioning, logic, and chaining.
- - Manual of description of the reports of the system which includes notably the
description of each report, its format and different modes of editing as well as
the average time for preparation processing.
- - Operational management manual
which contains notably the complete and detailed instructions for the use,
administration and the configuration of the applied software.
- - Glossary of technical terms
- - Model of the functions
- - Model of the data
- - Logic protocol
C. Supervision
The alarm systems
The applicative alarms
Processing of the alarms
P.C. emulator used to connect to the system
D. Administration
- Operating procedures
E. Test- Integration- Pre-production
Complete procedures (central site and central/terminal site)
Alarms and errors
Evaluation criteria
E. Supervision of the terminal
Management, visualization of the computers
Actions on the terminal (i.e. activation/deactivation, etc.)
Downloading
Supervision and Administration tool
<PAGE> 111
F. Presentation
- Presentation of the system architecture within the framework of FDJ
- Presentation of the SGI.NET application
- Its perimeter
- Its functions
G. Filing
SGI shall supply a detailed manual intended for the FDJ personnel in charge of
filing and downloading data. This documentation shall explain notably and in
detail the methods of filing, the system downloading and the maintenance of
filing of supports.
H. Audit of the transactions
SGI shall supply a detailed manual explaining the manner in which a transaction
may be audited on the test and production systems. This documentation shall
distinguish notably the case of transactions presented on the system and those
which are filed.
2J TERMINAL FIELD
SGI has given its agreement so that FDJ is autonomous to modify and add new
functions on the terminal SciScan.
2.1. TRAINING FURNISHED BY SGI
Within the framework of detailed training, FDJ wishes to have knowledge of the
software architecture in terms of:
- - base software,
- - application,
- - parameterization.
The training shall bear upon notably:
the software base (i.e., concepts and interface of concept manipulation),
the application (i.e., design, detailed specification of all processing,
sources, logic protocol),
the parameterization, the specifications of the applicative interfaces,
the description of the development environment (i.e., machines, compilers,
tools of the AGI type, etc.).
2.2. DOCUMENTATION SUPPLIED BY SGI
These themes shall be detailed in the following documents:
Installation manual
User manual
<PAGE> 112
Maintenance manuals for level I (i.e., field) and level 2 (i.e.,
workshop)
Certification of approval and test report
Support for the training of the retailers and training support for the
retailers (i.e., manuals, powerpoint presentations, transparencies, dedicated
training software residing in the terminal, video, etc.).
* General design manual which gives notably to the reader an overall
understanding of the structure and of the functioning of the applicative
software of the terminal.
- IHM manual which contains the description of the user screens,
explaining notably their purpose, functioning, logic and chaining.
* Description manual of the reports of the system which includes
notably the description for each report, its format and the different methods of
editing ax. will as the average time for preparation processing.
- Manual of operational management which contains notably the complete
and detailed instructions for use, administration and configuration of the
applicative software.
- Glossary of technical terms.
3) FIELD OF MARKETING, SALES AND PRINTERS
In this area, FDJ wishes notable to have a knowledge of possibilities and
constraints offered by the system:
The expected documentation bears notably upon:
- - the conception and design of the tickets and existing tools
- - the installation and exchange procedures of the terminals by a non-specialized
staff member (i.e., agents)
- - the training support of the user of the sales etwor (i.e., statistics,
retailers and agents)
SGI shall confirm, if FDJ so wishes, the compatibility of each game of FDJ
within 5 business days for all of the used games on the system, at least until
the end of the warranty of the software.
SGI shall also respond to questions which printers of the FDJ tickets might have
to make the tickets compatible with the System and to meet with them to give
presentations if needed.
4) OTHER GENERAL PROVISIONS
FDJ may transmit to third parties (i.e., maintenance or consultant providers)
the documentation pertinent to the carrying out of the missions given to them.
SGI shall organize at least three sessions of each of the training, in France on
the most appropriate FDJ site, relevant to the use of the software supplied and
of the documentation listed hereabove. At the close of these training sessions,
the participants whose profiles will have been suggested by SGI, shall be able
to assure the operation and parameterization of the system.
In the domain of the central site, the training sessions shall be completed by
the operational support SGI personnel during the year of their presence in
Vitrolles.
<PAGE> 113
SGI shall supply a detailed plan of training complete on these bases 90 days
after the signature of this agreement; this plan shall be presented to FDJ in
France and discussed. It is subject to the approval of FDJ.
The training necessary shall begin before the pilot test.
All of the documentation and the source code shall be in writing in accordance
with the norm IS09000 (at least for the central site) or following the internal
directives of SGI described which shall be supplied to FDJ upon signing the
agreement.
The source codes as well as the documentation for design, detailed design and
development shall be supplied on CD-ROM in accordance with Annex 4.
Upon each new version of the software, the documentation update shall be
supplied by SGI under the warranty then of the maintenance.
<PAGE> 114
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
ANNEXE 17: CODIFICATION DES TICKETS
La presente annexe decrit la codification souhaitee par FDJ et approuvee par SGI
pour le respect des standards de securite et la compatibilite avec le systeme
d'information de FDJ.
Overview
SGI-NET will require the ticket printers to provide a winner file for each game
printed for the French Lottery. [*]
Codification of the Instant Ticket
Figure I shows the front and back of the Instant Ticket
Figure I : Codification of the Instant Ticket
[*]
Ticket Front:
Play Area [*]
[*] [*]
Ticket Back:
[*] [*]
[*]
<PAGE> 115
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
There are [*] methods using SciScan:
1. [*]
2. [*]
3. [*]
Vendor Keys
[*]
Byte Mapping - Efficiency and Security
[*]
Figure 2: Fundamental Byte Map
[*] [*]
[*]
[*]
<PAGE> 116
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
[*]
[*]
[*]
[*]
Ticket Security - The Byte Map Link
[*]
[*]
[*]
<PAGE> 117
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
Ticket relationship to Host Byte Map
[*] [*]
Ticket, Prize Code, Key, Check [*]
Game / Pack
[*]
Encrypted Byte Map
[*] [*]
<PAGE> 118
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
SciScan 2000 Ticket Compatibility Description
July 22, 1998
Version [*]
COPYRIGHT
COPYRIGHT C 1998 SCIENTIFIC GAMES INTERNATIONAL
ALL RIGHTS RESERVED
This document and all related documentation are the property of the Scientific
Games International and may not be copied, sold, transferred or otherwise
disposed of without the written permission of the owners.
CONFIDENTIALITY
This manual contains proprietary information which is confidential and shall not
be made available to unauthorized persons.
<PAGE> 119
Copyright @ 1998 SGI preliminary - 1.0
Scientific Games Inc.
Notices
This document contains information proprietary to Scientific Games, Inc., and
its distribution is strictly controlled. This document and the information it
contains may not be reproduced, paraphrased, translated into another language,
or otherwise duplicated by any means without the prior written permission of
Scientific Games, Inc. The software documented in this volume is protected by
copyright and infringement will be prosecuted to the full extent of the law.
Scientific Games, Inc., makes no warranty, expressed or implied, with regard to
this material, including but not limited to warranties of merchantability or
fitness for any particular purpose. Scientific Games, Inc. accepts no liability
for errors contained in this document, or for incidental or consequential
damages associated with its provision, contents, or use.
The information contained in this document is subject to change without notice.
Software systems of this level of complexity may be implemented in many
configurations, so features may be described herein which are not implemented on
every system. Similarly, ongoing enhancements to this system may result in the
presence of features on a particular system which are not included in this
edition of the documentation. Authorized users will be notified as new editions
of the documentation are released.
Due to the confidentiality of the subject matter, revisions or alterations must
be undertaken by arrangement with Scientific Games, Inc., and distribution must
be conducted by Scientific Games, Inc., through the designated officials. For
further information, please contact:
Scientific Games International 1500 Bluegrass Lakes Parkway Alpharetta, GA 30201
Telephone: (770) 664-3700 Fax Number: (770) 343-8798
Copyright(O 1998 by Scientific Games International; All rights reserved.
- - Confidential -
<PAGE> 120
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
I. Overview
[*]
A. What are Electrical Characteristics?
All matter has inherent electrical properties. For example, air has a very high
electrical resistance while copper's electrical resistance is very low. This is
why the wires in your house are made of copper and electricity does not "leak
out " on the floor.
There are three fundamental (passive) electrical properties that can
theoretically be measured:
- - Resistance
- - Capacitance
- - Inductance
[*]
B. Signature File Generation
[*]
[*]
- - CONFIDENTIAL -
<PAGE> 121
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
2
[*]
[*]
[*]
C Quick Ticket Testing
[*]
[*]
D. [*]
[*]
- - CONFIDENTIAL -
<PAGE> 122
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
3
[*]
E. Conclusions
SciScan Technology compares [*] to determine if a ticket produces the correct
[*] signature. This [*] signature can be utilized to determine if the ticket is
authentic as well as if it has been properly played.
While SciScan Technology can operate with virtually all paper tickets, to ensure
compatibility and security, the design guidelines specified in this document
must be observed.
II. Mandatory Requirements
This section provides a listing of the minimum requirements that must be
maintained for a ticket to be compatible with SciScan Technology. [*]
A. [*]
[*]
1. [*]
[*]
- - CONFIDENTIAL -
<PAGE> 123
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
4
[*]
[*]
[*]
2. [*]
[*]
3. [*]
[*]
[*]
[*]
4. [*]
[*]
5. [*]
[*]
- - CONFIDENTIAL -
Figure 1: [*]
B. [*]
[*]
1. [*]
2. [*]
<PAGE> 124
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
3. [*]
[*]
1 - - [*]
[*]
[*]
Figure 2: [*]
a) [*]
[*]
- - CONFIDENTIAL -
<PAGE> 125
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
8
3. [*]
[*]
[*]
[*]
Figure 3: [*]
C Summary
For ease of reference, a summary of the mandatory SciScan Technology'
requirements is provided in Table 1.
Table 1: Mandatory Specification Summary
Category Description
- - CONFIDENTIAL -
<PAGE> 126
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
Category Description
[*] [*]
[*]
<TABLE>
<S> <C> <C> <C>
[*] [*]
1.
2.
[*]
[*]
[*] [*]
[*]
[*] [*]
[*]
</TABLE>
- - CONFIDENTIAL -
<PAGE> 127
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
10
(i) [*]
(ii) Ibid.
- - CONFIDENTIAL -
<PAGE> 128
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
1.
SCIENTIFIC GAMES
INTERNATIONAL
KEI-98-21 5
September 9, 1998
To: Vincent Bernheim (La Francaise Des Jeux)
From: Ken Irwin
Subject: Ticket Printing Specification
REFERENCE: Ticketprinting specifications memorandum from La Franchise Des Jeux
(Vincent Bernheim) to Scientific Games International (Ken Irwin)
dated 28, August 1998
Vincent:
This memorandum documents my answers to your follow-on questions raised in the
referenced memorandum.
I. [*]
[*]
[*]
- - CONFIDENTIAL -
<PAGE> 129
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
2
[*]
[*]
[*]
[*]
[*]
[*]
[*]
- - CONFIDENTIAL -
<PAGE> 130
3
Figure 1
Figure 2
<PAGE> 131
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
4
Figure 3
Figure 4: [*]
- - CONFIDENTIAL-
<PAGE> 132
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
5
Figure 5: [*] definitions
IV. [*]
A Barcode symbology
[*]
- - CONFIDENTIAL -
<PAGE> 133
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
Figure 6: Nominal [*] Positions
V. [*]
[*]
Regards,
[*]
- - CONFIDENTIAL -
<PAGE> 134
Scientific Games, International
To: Vincent Bemheim (La Francaise des Jeux)
From: Ty Ryan (Scientific Games, International)
Date: September 28, 1998
Dear Vincent,
Scientific Games has received satisfactory confidentiality agreements with your
printing suppliers, BABN and Pollard. Therefore you are welcome to proceed at
once to discuss with these suppliers the SGI SciScan ticket printing
requirements.
Sincerely,
Ty Ryan
SGI Fortuna Project Manager
<PAGE> 135
ANNEX 19
TERMS AND CONDITIONS OF THE PURCHASE OF SCISCAN TERMINALS
1. DEFINED TERMS AND REFERENCES
1.1 DEFINITIONS
For and on behalf of
Agreement means this Agreement including the annexes hereto;
Initial Order has the meaning given to it in Section 4;
EXW is an Incoterm. signifying "at the factory" and has the meaning given to it
in Section 6;
NOA means the level of acceptable quality for the receipt of SciScan Terminals,
as such term is used in Annex 5;
SciScan Terminal is defined in Section 2;
1.2 INTERPRETATION
In this Agreement:
(a) defined terms, unless the context requires otherwise, when referenced
in the singular shall include reference to the plural;
(b) headings and the use of bolded characters shall be ignored; and
(c) all references to a section, sub-section or annex shall, unless
expressly provided otherwise, be reference to a section, sub-section or
annex of this Agreement.
2. PURPOSE
This Agreement sets forth the general terms and conditions upon which SGI agrees
to manufacture for, in association with manufacturers selected by SGI, and sell
to FDJ, and FDJ agrees to purchase from SGI SciScan Terminals in accordance with
the specifications set forth in Annex I (the "SciScan Terminals").
SGI guarantees that the SciScan Terminals shall be compatible with the SciScan
Terminal software provided to FDJ by SGI.
1
<PAGE> 136
FDJ shall not buy SciScan Terminals for the purpose of reselling them in such a
way that it would compete with -the activities of SGI. Nevertheless, this
provision does not prohibit FDJ from selling or leasing (directly or indirectly)
Terminals to Pr6lo, or to its agents or retailers.
3. EFFECTIVE DATE - TERM
This Agreement shall become effective as of the date of signature hereof by the
parties and shall remain in effect for an indefinite period. Following
fulfillment of the Initial Order (as defined in Section 4, this Agreement may be
terminated at any time by either of the parties upon giving nine (9) months
prior written notice to the other Party.
In the event of termination, orders remaining unfulfilled at the effective date
of termination shall be fulfilled and shall continue to be governed by the terms
and conditions of this Agreement.
4. ORDERS - TERMS AND CONDITIONS OF ORDERS
The signature of this Agreement constitutes the initial order of the SciScan
Terminals (hereafter the "Initial Orde ") in accordance with the terms and
conditions set forth in Annex 2.
Orders placed by FDJ after the initial Order must make explicit reference to
this Agreement, give the reference to the SciScan Terminal, the type, the
quantity and the delivery date requested for the SciScan Terminals, by way of
notification in accordance with this Agreement.
SGI undertakes to acknowledge these orders within ten (10) days of their receipt
or to inform FDJ within such period of any difficulty related to the delivery
dates specified in these orders.
After said period of ten days following the receipt of an order, and in default
of an acknowledgment or statement of reservations, orders shall be deemed
accepted in accordance with the terms and conditions set forth on any such
order, provided that the same shall comply with the terms and conditions of this
Agreement, and provided further that such order has been notified in accordance
with this Agreement and shall state the consequences of failure to respond.
Orders in respect of spare parts shall be placed in the same manner as those in
respect of SciScan Terminals.
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5. PRICE AND PAYMENT METHODS
5.1 PRICE
The price of SciScan Terininals shall be as indicated in Annex 3 hereto.
SGI shall use its best efforts to permit FDJ to benefit in turn from decreases
in the purchase price to which SGI may have access with respect to electronic
components, as well as innovation available through third parties in the market
likely to reduce the final cost of the product.
In any event, should SGI wish to upwardly revise the price, it shall be required
at the time of seeking agreement from FDJ, to justify and supply the reasons
leading it to increase the price. For such purposes, SGI shall, in particular,
be required to demonstrate that it shall not profit from the decrease in prices
in the electronics market and that the import taxes payable by SGI with respect
to such electrical components have not decreased.
In any event, as long as the parties disagree on the evolution of the price, the
price set forth in Annex 3 shall continue to apply.
5.2 TERMS OF PAYMENT
Payment shall be made as follows:
- - 25% of the total order when each order is placed,
- - The balance at the signature of each reception form as set forth in
Article 8.
The sums due shall be paid excluding taxes or including taxes according to the
applicable tax regime at the time.
All payments and settlement of installment claims shall be made without
deduction on the 10th of the month following a period of thirty (30) days from
the date of receipt of the invoice by SGI.
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5.3 Currency
For all purposes and in accordance with the principles of monetary laws, it Is
hereby acknowledged that amounts payable in French Francs shall be deemed
denominated and/or payable in European currency, when the French Franc is no
longer the lawful currency or, more generally, is replaced by the European
currency in accordance with applicable European and/or French regulations. The
rates used to convert the French Franc at such time shall be those provided
pursuant to Article 109L of the Treaty on the European Union.
6. DELIVERY TERMS
SciScan Terminals shall be delivered Ex Works, SAGEM, Saint-Etienne du Rouvray
in accordance with the planning set forth in Annex 2 of the present Annex 19.
The parties agree that, unless specifically provided otherwise in this
Agreement, the Incoterm. "EX WORKS - EXW", by its 1990 definition by the ICC,
shall be applicable to all deliveries of SciScan Terminals.
Any delivery made to FDJ shall be made with a delivery note setting forth the
necessary details and references for the identification of deliveries.
In any event, it shall be for FDJ to verify the good state of packaging and, if
necessary, to endorse on the delivery note remitted to the carrier, its
justified reservations concerning any anomalies and apparent damages to goods.
Partial or split deliveries (limited to a maximum of thirty (30) days) shall
require the prior agreement of FDJ.
Transfer of title in and to the SciScan Terminals shall take place upon payment
of the full price in respect thereof.
7. QUALITY CONTROL
SGI warrants and undertakes with FDJ that it shall apply a quality control
system in respect of each stage of production, guaranteeing the high quality of
SciScan Terminals to be delivered to FDJ.
The factories producing the SciScan Ten-ninals shall be ISO 9002 certified or
shall use similar procedures as those required by ISO 9002. The research centers
responsible for SciScan Terminals shall be ISO 9001 certified or shall use
similar procedures as those required by ISO 9001.
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FDJ hereby reserves the right to verify that such quality control system is
being applied, provided that it shall comply with the security and access
regulations of the manufacturer producing the SciScan Terminals.
8. PENALTIES
The parties agree that in the event of late delivery of more than ten (10)
business days or any delay in supplying maintenance or guarantee services, FDJ
shall be entitled to impose penalties in the conditions described hereafter.
In the event that FDJ decides to impose late delivery penalties upon SGI, such
penalties shall run from the end of the tenth business day following (i) the day
that the related SciScan Terminals should have been delivered in accordance with
the agreed dates for delivery, and in a state allowing its reception, or (ii)
the day on which the maintenance or guarantee services should have been
completed.
PENALTY FORMULA
P=NxJxV
1000
Letters in the above formulae are defined as follows:
P = Amount of penalty in Francs;
j = Number of days late (following deduction of ten (10) business days
allowance);
N = Number of SciScan Terminals delivered late.
V = Price in French Francs of the SciScan Terminal,
before options, or of a replacement part or service
as the case may be.
The parties agree that the penalties shall be cumulative, and that penalties
hereunder, irrespective of cause, may not exceed 15% of the total value of V.
Penalty payments due may be set off against current or future SGI invoices. To
the extent that SGI makes up for late deliveries in subsequent deliveries under
this Agreement, retained penalties shall be reimbursed to SGI.
In the event of a 90 day delay exceeding the dates set in the delivery schedule,
FDJ shall be entitled to terminate the Agreement in accordance with the
provisions of Section 2 1.
Payment of the penalty by SGI is not due if the delay is attributable to force
majeure or to FDJ.
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Any delay attributable to FDJ shall lengthen the time allotted to SGI for a
period of time which will not exceed such delay; moreover, SGI shall be entitled
to charge FDJ for reimbursement, with supportive evidence, for expenses born by
SGI with respect thereto.
9. SCISCAN TERMINAL ACCEPTANCE
9.1 ACCEPTANCE PROCEDURE
The factory acceptance shall be the only acceptance, and may be conducted in
presence of the final client.
The SciScan Terminals must be accepted before delivery.
FDJ shall proceed with the acceptance of the Terminals within a deadline of five
(5) business days from the receipt of the notice that the Terminals are ready
for acceptance.
The specifications of the tickets to be validated by the Terminals appear in
Annex 17 and Annex 18.
9.2 ESTABLISHMENT OF AN ACCEPTANCE PROCEDURE
FDJ shall supply within one month from the signing of this Agreement two
standard draft acceptance procedure forms (one for the pre-series Terminals and
one for the series Terminals). These drafts will pem-iit SGI to prepare and
notify to FDJ draft acceptance procedure forms that shall be sent to FDJ within
90 calendar days from the date on which SGI receives the draft acceptance forms.
The Parties shall have a period of fifteen (15) business days following the
notification to FDJ of the draft acceptance form prepared by SGI in order to
agree on the contents, approve the provisions and sign a copy thereof. The
completed acceptance form so signed and approved shall form an integral part of
this Agreement.
The Parties hereto may provide, by mutual agreement, for complementary tests
that may have been omitted at the time of the establishment of the completed
acceptance form.
The level of acceptance testing requested shall not exceed the specifications in
the cahier des charges.
For purposes of the acceptance, the quality levels of Annex 5 shall apply.
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If the parties do not reach an agreement on the contents of the acceptance
procedure forms before the deadlines indicated above, such form shall be drafted
by an expert nominated by mutual agreement from the Paris Appellate Court list
of judicial experts. In the event that the parties are unable to reach an
agreement with respect to an expert, the expert shall be named by the President
of the Paris Commerce Tribunal (Prisident du Tribunal de Commerce de Paris) upon
petition by the most diligent Party.
9.3 METHOD OF ACCEPTANCE
For the acceptance of the SciScan Terminal, SGI shall make available to FDJ the
infrastructure and human resources so as to facilitate the expeditious carrying
out of testing and acceptance.
SGI shall make available to FDJ all testing procedures and specific tools
necessary for the performance of acceptance testing.
SGI shall provide to FDJ a simulator with access to the central site as
necessary for the acceptance procedure.
The representatives of the Parties present during the acceptance procedures
shall have the power to bind the party that he represents, in particular, for
the purposes of carrying out the testing and the technical and functionality
trials, and to individually sign the acceptance forms, with or without
reservations.
9.4 EVENTS AFFECTING ACCEPTANCE
In the event that FDJ does not participate in the acceptance procedure within
the deadlines set out in Section 9.1 above, SGI shall put FDJ on notice to
accept the terminals in question.
FDJ shall have an additional five (5) day period from receipt of this notice to
carry out the acceptance. Otherwise,the acceptance shall be pronounced
automatically at the end of this period and SGI shall be authorized to sign
acceptance forms on behalf of FDJ.
In the event that FDJ does not accept the Terminals due to the fault of SGI, FDJ
shall proceed with a second acceptance attempt within 10 business days following
the failed acceptance In the event of failure of the second attempt at
acceptance, FDJ may proceed with a new acceptance attempt in agreement with SGI
or commence a period of negotiation of fifteen (15) days from the date of
notification of refusal by FDJ.
Changes relating to the acceptance criteria, to dates, to the price or to other
terms and conditions, in addition to the agreement relating to the completed
acceptance form relating to such elements, shall be formalized by the signature
of an amendment to this Agreement at the end of the period of negotiation.
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If the parties are unable to reach agreement during the period of negotiation,
either Party shall be entitled to rely upon the provisions of Section 21 of this
Agreement.
10. WARRANTY
10.1 WARRANTY IN RESPECT OF THE SCISCAN TERMINALS
SciScan Terminals are warranted with respect to both materials and workmanship
for a period of twelve (12) months from the date of installation with a maximum
period of fifteen (15) months from the date of delivery to FDJ.
In addition to the warranty against hidden defects provided for in Article 1641
of the Civil Code, under which SGI is responsible, SGI gives the contractual
warranties provided for below.
The warranty shall consist of the repair or exchange of the defective component
at the factory or repair shop designated by SGI, in such manner that the SciScan
Terminal shall always be in an acceptable state of functionality.
The exchanged component need not be new, but must be fit for the purpose for
which it is destined. The replacement component shall become the property of
SGI.
Replacement of the defective parts, as well as labor and transport costs of the
exchanged or repaired parts to the destination designated by FDJ shall be borne
by SGI.
All the other costs are to be borne by FDJ.
SGI shall be required to return defective SciScan Terminals to FDJ in working
order within ten (10) business days (on an average calculated monthly, the date
of shipment being counted within the calculation).
Any delay of SGI in putting each SciScan Terminal back in a state of working
order shall entitle FDJ to impose upon SGI the penalty payments provided for in
Section 8.
The following are excluded from the warranty:
breakdown or dysfunction due to improper use of the SciScan Terminal or
noncompliance with user or installation instructions;
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- - breakdown or dysfunction due to an external cause (including, but
not limited to, knocks, breakage, accident, humidity, water or other
liquid damage, lightning, shortcircuit, power supply faults, acts of
vandalism, theft or attempted theft, defective lines);
- - normal wear and tear of the SciScan Terminal and its accessories;
- - breakdown or dysfunction caused by modifications or add-ons made to a
SciScan Terminal without the written consent of SGI;
- - damage due to failure to maintain in accordance with the user manual or
lack of surveillance or care;
- - damage resulting from repairs or maintenance carried out by non-SGI
approved persons;
- - breakdown or damage caused by the use of consurnables other than those
recommended by SGI;
- - deterioration following or due to insufficient packaging and/or poor
condition of equipment returned to SGI;
- - transmission faults (telecommunication network) including, but not
limited to, bad geographical coverage by radio-electrical transmitters,
interference linked to weather conditions, or faulty or poor quality
telephone lines; and
- - defects caused to a SciScan Terminal by bad environmental conditions.
Where the request for intervention addressed by FDJ is not attributable to
equipment delivered by SGI (i.e., hardware, software etc.), SGI shall be
entitled to invoice in accordance with its rates in force at the time of
intervention, forwarding costs not being included therein.
Should FDJ and SGI, and their respective technicians, disagree upon the
application of any of the foregoing warranty exclusions, FDJ and SGI shall
jointly appoint an external consultant, for the purpose of resolving their
dispute within 15 days. The consultant will allocate the resulting expenses
depending on the merit of the claims of each party. The decision of the
consultant shall bind the parties and be definitive.
10.2 INFRINGEMENT
SGI guarantees to FDJ that SciScan Terminals delivered pursuant to this
Agreement do not infringe any intellectual property rights, as defined under the
French Intellectual Property Code.
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FDJ shall not claim against SGI any indemnity or compensation for infringement
of any intellectual property rights owned by FDJ.
For purposes of this guarantee, SGI shall conduct the defense of FDJ in
cooperation with the latter and in respect thereof, SGI shall be liable for
litigation costs, legal and expert fees and any damages award together with
interest arising from any definitive and non-appealable decision holding that
FDJ infringes intellectual property rights of third parties. SGI shall also
offer to substitute a non infringing element for any infringing element.
It is acknowledged and agreed that the selection of counsel by SGI shall be
subject to the prior agreement of FDJ.
FDJ undertakes to promptly notify SGI in writing of any infringement claims as
soon as FDJ becomes aware of any such claim.
11. TERMINAL MAINTENANCE
SGI shall offer to FDJ, for a flat fee per SciScan Terminal per year, workshop
maintenance for the SciScan Terminals described in Annex 6 during a minimum
period of seven (7) years. This price is established in function of the
performance requirements in Annex 8. If FDJ issues the request by registered
mail return receipt requested, at least six (6) months before the expiration of
the contractual warranty defined in Section 11 of the Agreement, FDJ and SGI
shall sign a maintenance agreement for a period of one (1) year, that shall be
automatically renewed unless expressly terminated by either Party with three
months notice, until the expiration of a period of seven (7) years, such
agreement to incorporate and be subject to the terms, conditions and methods set
forth in Annex 6.
The fee proposed by SGI for maintenance of the SciScan Terminals shall conform
to the price set forth in Annex 6. Such fee shall be indexed-linked, as of the
end of the first year of maintenance, to the SYNTEC index by application of the
adjustment formula set forth in Annex 6.
SGI is not obligated to propose field maintenance. FDJ shall provide the
maintenance of SciScan Terminals at the points of sale.
12. AFTER-SALE SUPPLY OF SPARE PARTS
At the end of the contractual warranty period, if no maintenance contract as
described in Section I I above has been signed, or in the event that the
warranty is excluded, SGI shall supply FDJ with replacement equipment and parts
(i.e., cards and modules), in accordance with Annex 4 for a minimum period of
seven (7) years from the date of the last delivery of
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SciScan Terminals to FDJ. During such period, the price of parts may be adjusted
annually from the expiration date of the warranty period in respect of the
Initial Order in accordance the identical procedure set forth in Section 5 of
this Agreement.
As soon as it becomes aware of the same, SGI shall alert FDJ as to those
components that are liable to either disappear from the market or become
obsolete. In such event, SGI shall use its best efforts to propose technical
solutions to FDJ in order to resolve the problem(s) linked to the disappearance
or obsolescence of such components. If any such solution is adopted by FDJ, SGI
shall ensure that parts or modules are supplied that permit increased
compatibility with the SciScan Terminals. Research and development costs shall
be considered on a case by case basis.
The quantities of replacement components and the financial terms in respect
thereof shall be established by mutual agreement by reference to the actual
NITBF of each module.
13. CLEARANCE FOR TERMINALS
SGI shall deliver SciScan Terminals having obtained prior to their delivery all
necessary clearances for their exploitation in France, and respecting the
applicable standards and regulations on their delivery date, and in particular:
- - EN 60950 (electrical security)
- - EN 55022 (CEM)
- - EN 50082-1 (CEM) * B 1123 A (telephone network access)
14. NOTICES ON TERMINALS
SciScan Terminals and sub-elements of the SciScan Terminals shall be branded
with the name "La Frangaise des Jeux" as set forth in the purchase orders.
The marking films (fllms de marquage) must be supplied to SAGEM three (3) months
before the delivery.
15. DOCUMENTATION
The following documents shall be supplied with each SciScan Terminal:
- - French user guide;
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- - French installation guide
The parties hereto agree that SGI shall assume responsibility in respect of
information contained in said guides.
Generally, the content of any documentation intended for non-professional end
users shall require ratification by both parties hereto.
In addition, SGI shall provide FDJ ten (10) copies of the technical
documentation of the SciScan Terminals, so that FDJ may undertake the
maintenance of its SciScan Terminals by itself, if it elects to do so.
16. LIABILITY
16.1. LIABILITY
SGI shall perform the obligations undertaken by it under this Agreement subject
to and in accordance with professional standards prevailing in its industry and
all applicable regulations, and, in particular, with the Labor Code (Code du
Travail) and the Intellectual Property Code (Code de la Propriiti
Intellectuelle). FDJ shall be solely liable with respect to regulations
specifically applicable to FDJ's activities.
To the extent, that due to the performance or non-performance of the obligations
under this Agreement, FDJ is able to show that it has suffered loss, it shall,
where there has been proven default by SGI, be entitled to claim damages subject
to the provisions set forth below in the Section entitled "Limitation of
Liability".
16.2. LIMITATION OF LIABILITY
SGI is responsible for proven breaches under this Agreement, and shall indemnify
SGI for direct, corporal or material damages resulting to SGI within the limit
of the total price of the SciScan Terminals ordered pursuant to this Agreement.
SGI shall not be responsible for indemnifying FDJ for indirect damages such as
lost profits or loss of clientele.
SGI shall, in no event, be liable for any loss due to the non-performance by FDJ
of all or part of its obligations, immaterial and/or indirect, such as loss of
winnings, loss of profits or clientele.
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17. LIEN - COMPENSATION
Neither party is permitted to exercise any lien or right to compensation with
respect to the other party without having obtained either such party's
authorization or an enforceable arbitration order.
18. INSURANCE
SGI warrants that it has sufficient insurance cover to cover its professional
responsibility and shall justify the same upon request by FDJ.
19. PERSONNEL
Personnel that are engaged by SGI to work upon equipment, facilities and/or
sites of FDJ shall remain at all times in the employ of SGI, with regard to
which it shall bear all employer obligations. SGI shall hire, manage and
remunerate only its own personnel and shall be solely responsible for the
management, discipline and the security of said personnel. Where SGI is engaged
on FDJ sites, SGI personnel shall be required to conform to the Internal
Regulations and to the security standards in force at FDJ establishments where
it carries out its engagements.
20. FORCE MAJEURE
The parties hereto shall not bear liability in respect of lateness or
non-performance of obligations under this Agreement caused by an event of force
majeure.
The expression "force majeure" means any event exterior to and not within the
control of the parties that is unforeseeable and which prevents the performance
of the obligations under this Agreement, in whole or in part, or renders the
performance thereof excessively onerous or difficult for either one of the
parties.
Events of force majeure are deemed to include, without limitation, the
following: natural disasters, acts of war, political unrest, strikes,
governmental edicts (including, without limitation, the repeal of statute or
regulations allowing the exploitation of games of chance in France) or the
imposition of taxes, if the latter has the effect of materially affecting the
performance of this Agreement.
It is expressly agreed that an event of force majeure shall result only in the
suspension of the obligations of either party under this Agreement only during
the period in which such event
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has effect. The party seeking to rely on the provisions hereof is required to
notify the other party subject, and in accordance with the provisions hereof.
Suspension of this Agreement may not, in any event, exceed three (3) months from
the date of receipt of the above-mentioned notice. At the expiration of said
period, the parties shall meet so as to mutually agree to the termination of
this Agreement, on the basis of a payment made to SGI on a pro rata basis for
work done. In the absence of agreement, the most diligent party may demand
termination hereof by court order.
21. TERMINATION
In the event of breach by one of the parties of this Agreement, the
non-defaulting party may terminate this Agreement, without prejudice to any
other rights it may have, as of right, with thirty (30) days notice, issued and
sent by certified mail with return receipt requested to the breaching party and
where, at the end of such period, the breach remains either partially or
completely unremedied.
Orders submitted prior to the effective date of termination of this Agreement
shall remain unaffected thereby.
22. ASSIGNMENT
This Agreement is personal to SGI, who is accordingly expressly prohibited from
assigning any of its rights or obligations either in whole or in part whatsoever
with respect to the Agreement, without having previously obtained the written
consent of FDJ (except to associated companies within its Group consequent upon
the current restructuring of the same), which consent shall not be unreasonably
withheld, and, in any event, shall be in compliance with the joint-venture
agreement between FDJ and SGI of same date.
FDJ shall not be entitled to rightfully refuse any such assignment if, in
particular, it arises from a purely internal restructuring of SGI and if the
assignee company makes the same undertakings AND WARRANTIES TO FDJ with respect
to solvency, durability and competence as SGI hereunder, and to the extent only
that performance of this Agreement is not altered thereby.
For the purposes of this Section, any change in the majority-ownership of share
capital of SGI, any capital contribution, merger, absorption, and, generally,
any corporate transaction aimed at or resulting in a change in the corporate
ownership of SGI shall be deemed to constitute an assignment.
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23. SUBCONTRACTING
SGI may use subcontractors for the performance of its obligations hereunder.
SGI warrants that with respect to its subcontractors, it has obtained all such
necessary contractual undertakings so as to enable it to perform its obligations
under this Agreement.
SGI shall be directly liable for all of the acts and omissions of
subcontractors, even where the same have been selected with the approval of FDJ.
SGI shall ensure that all of the obligations of subcontractors shall be fully
performed.
Subcontracting hereunder shall be subject to the Law of December 31, 1975.
24. CONFIDENTIALITY
Throughout the term of this Agreement, the parties may come into possession of
confidential technical, commercial or financial information.
Each of the parties hereby undertakes that it shall, and shall procure that its
employees and all parties acting on their behalf shall, preserve the absolute
confidentiality of all technical data, information or advice that may come into
its possession in either the negotiation, signature and performance phases of
this Agreement.
Information, concepts or techniques shall not, however, be deemed to be
confidential if:
- - they are, at the time of their disclosure, either in the public domain
or have fallen into the public domain in the absence of any breach of
the terms of this Agreement;
- - they are known to one or the other of the parties without any breach of
the obligation of confidentiality hereunder; or
- - they have been received in a lawful manner by one or other of the
parties from a third party without any obligation of confidentiality.
The parties hereto agree that the terms of this Agreement are confidential.
In the event that one of the parties is obliged by law to disclose confidential
information, this Party shall inform the other Party in the shortest possible
time. In such a case, the Party obliged to disclose the information shall only
disclose the minimum information required by law, and, when feasible, shall
obtain protective measures or ensure the confidentiality of disclosed
information.
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The obligation of confidentiality under this Section shall remain in effect for
a period of five (5) years following the end of this Agreement for whatever
cause.
25. ADMINISTRATIVE STEPS
SGI shall proceed with the filings, declarations, and applications for
authorizations required by applicable laws in relation to performance of this
Agreement.
26. LANGUAGE
The parties agree that the language used for the purposes of the execution of
this Agreement shall be French. Accordingly, correspondence exchanged and
meetings conducted between the parties shall be in the French language.
27. ENTIRE AGREEMENT
The provisions of this Agreement and its Annexes express the entirety of the
agreement concluded herein between the parties hereto concerning the
subject-matter hereof and accordingly shall prevail over any statement, exchange
of correspondence occurring prior to the signature hereof, and over any other
provision set forth in documents exchanged between the parties and relating to
the subject-matter hereof.
28. NO WAIVER
If, on one or more occasions, one of the parties does not require the observance
of one or more of the provisions of this Agreement, this shall not in any event
be deemed to constitute any waiver by that party of its rights under such
provision or any other provision of the Agreement in identical or any other
circumstances.
29. AMENDMENT
The provisions of the body of this Agreement together with the deadlines and
financial terms hereof may not be amended except by means of a written amendment
signed by the duly authorized representatives of both parties and executed at a
date following the effective date of this Agreement. Other provisions, and in
particular, technical Annexes, may be amended
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resulting from the reports of progress meetings, as soon as they have been
signed by the appointed operational representatives of the parties indicated in
Annex 7.
The pre-printed general terms and conditions of purchase or sale set forth on
purchase orders, receipts and invoices shall be without effect.
30. PUBLICITY
The parties agree that the terms of this Agreement are confidential and that SGI
shall not cite the Agreement as a commercial reference without having obtained
the prior written consent of FDJ.
However, the parties agree that they may mention the Agreement in order to
comply with the applicable legal requirements.
31. INTERPRETATION
In the event of contradiction between the terms contained in the body of this
Agreement and those of its Annexes, the provisions contained in the body of this
Agreement shall prevail over those of its Annexes.
32. INDEPENDENCE OF THE PARTIES
Neither this Agreement, nor any provisions hereof, shall be deemed to create any
partnership (socijti en participation), agency or franchise between the parties
or create a relationship of employer-employee between one of the parties and the
employees of the other party.
33. HEADINGS
The headings of Sections in this Agreement are solely employed for ease of
reference and shall not prevail over or be deemed to modify or amend any of the
same.
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34. GOVERNING LAW AND DISPUTES
34.1 GOVERNING LAW
This Agreement is governed by and shall be interpreted in accordance with the
laws of France.
34.2 ARBITRATION
Any dispute arising between the parties relating to the interpretation or
performance of a provision of this Agreement or its Annexes shall be settled by
one or more arbitrators according to the Rules of Arbitration of the
International Chamber of Commerce.
The parties agree that the language of arbitration shall be French and that the
place for -arbitration shall be Paris.
34.3 CHOICE OF DOMICILE AND JURISDICTION
The parties hereby elect domicile at their respective registered offices. Any
notice required to be served hereunder as a result of non-performance of any of
the terms of this Agreement shall be addressed to the respective registered
offices of the parties.
34.4 Notice
Any notice or other communication under this Agreement shall be deemed given if
delivered in writing to the intended recipient either in person, or by mail,
certified or registered, postage prepaid, or by recognized overnight delivery
service, or by telecopier to the intended recipient at the address and
telecopier number specified herein:
<TABLE>
<S> <C>
If to SGI: If to FDJ:
Scientific Games International La Franqaise des Jeux
Attention: Mr. William J. Malloy Attention: Pr6sident-Directeur G6n6ral
President and CEO 5-7 rue Beffroy
1500 Bluegrass Parkway 92523 Neuilly sur Seine
Alpharetta, Georgia 30004
USA FRANCE
With a copy to Gray Bethea, Jr. With a copy to the Department Juridique
</TABLE>
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<TABLE>
<S> <C>
Vice President and General Counsel Fax No. 33 146 4136 33
Fax No. 1770 343 8798
</TABLE>
or such other address or telecopier number as a party may specify from time to
time pursuant to this Section.
Notice sent in the manner described above shall be deemed effectively given as
of the date of receipt.
Made in Neuilly-sur-Seine,
This day of _, 1998,
In two originals
For and on behalf of For and on behalf of
FDJ SGI
Mr. Bertrand de GALLt Mr. Bruce H. LONGHURST
- ------------------------------------ ------------------------------------
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NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
ANNEX 1: SPECIFICATIONS OF SCISCAN TERMINALS
The SciScan Terminals, including those in the Initial Order, shall have the
characteristics described hereafter:
This document is property of group SAGEM. No part of it may be reproduced
without SAGEM's permission.
SHEET RELEASE
<TABLE>
<CAPTION>
release date author modification description
<S> <C> <C> <C>
[*] X. CHAUSSADE [*]
JF LALLEMANT
2 W. BEHM
(SGI)
A X. CHAUSSADE
</TABLE>
<PAGE> 155
CONTENTS
<TABLE>
<S> <C> <C>
1. DEFINED TERMS AND REFERENCES .............................................................................1
1.1 Definitions .....................................................................................1
1.2 Interpretation ..................................................................................1
2. PURPOSE ..................................................................................................1
3. EFFECTIVE DATE - TERM ....................................................................................2
4. ORDERS - TERMS AND CONDITIONS OF ORDERS ..................................................................2
5. PRICE AND PAYMENT METHODS ................................................................................3
5.1 Price ...........................................................................................3
5.2 Terms of Payment ................................................................................3
5.3 Currency ........................................................................................4
6. DELIVERY TERMS ...........................................................................................4
7. QUALITY CONTROL ..........................................................................................4
8. PENALTIES ................................................................................................5
9. SCISCAN TERMINAL ACCEPTANCE ..............................................................................6
9.1 Acceptance Procedure ....................................................................................6
9.2 Establishment of an acceptance procedure ........................................................6
9.3 Method of acceptance ............................................................................7
9.4 Events Affecting Acceptance .....................................................................7
10. WARRANTY ................................................................................................8
10.1 Warranty in respect of the SciScan Terminals ...................................................8
10.2 Infringement ...................................................................................9
11. TERMINAL MAINTENANCE ...................................................................................10
12. AFTER-SALE SUPPLY OF SPARE PARTS .......................................................................10
13. CLEARANCE FOR TERMINALS ................................................................................11
14. NOTICES ON TERMINALS ...................................................................................11
15. DOCUMENTATION ..........................................................................................11
16. LIABILITY ..............................................................................................12
16.1. Liability ....................................................................................12
16.2. Limitation of Liability ......................................................................12
17. LIEN - COMPENSATION ....................................................................................13
18. INSURANCE ..............................................................................................13
19. PERSONNEL ..............................................................................................13
20. FORCE MAJEURE ..........................................................................................13
21. TERMINATION ............................................................................................14
22. ASSIGNMENT .............................................................................................14
23. SUBCONTRACTING .........................................................................................15
</TABLE>
<PAGE> 156
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
<TABLE>
<S> <C> <C>
24. CONFIDENTIALITY .......................................................................................15
25. ADMINISTRATIVE STEPS ..................................................................................16
26. LANGUAGE ..............................................................................................16
27. ENTIRE AGREEMENT ......................................................................................16
28. NO WAIVER .............................................................................................16
29. AMENDMENT .............................................................................................16
30. PUBLICITY .............................................................................................17
31. INTERPRETATION ........................................................................................17
32. INDEPENDENCE OF THE PARTIES ...........................................................................17
33. HEADINGS ..............................................................................................17
34. GOVERNING LAW AND DISPUTES ............................................................................18
34.1 Governing Law ................................................................................18
34.2 Arbitration ..................................................................................18
34.3 Choice of Domicile and Jurisdiction ..........................................................18
34.4 Notice .......................................................................................18
1. SUBJECT ................................................................................................23
1.1. Introduction .................................................................................23
1.2. References ...................................................................................23
2. GENERAL DESCRIPTION ....................................................................................23
2.1. Presentation .................................................................................23
2.2. Features .....................................................................................23
2.3. General Architecture .........................................................................25
3. HARDWARE DESCRIPTION ...................................................................................26
3.1. [*] ..........................................................................................26
3.2. [*] ..........................................................................................29
3.3. [*] ..........................................................................................33
3.4. [*] ..........................................................................................34
3.5. [*] ..........................................................................................34
3.6. [*] ..........................................................................................35
3.7. [*] ..........................................................................................35
3.8. [*] ..........................................................................................35
4. SOFTWARE DESCRIPTION ...................................................................................36
4.1. [*] ..........................................................................................36
4.2. [*] ..........................................................................................36
</TABLE>
<PAGE> 157
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
1. SUBJECT
1.1. Introduction
This document is the description of the SCISCAN terminal hardware
specifications, that SAGEM is proposing to SCIENTIFIC GAMES for the FORTUNA
project.
1.2. References
SCISCAN DOCUMENTATION: SGI
[*] [*]
[*] [*]
[*] [*]
[*] [*]
[*]
2. GENERAL DESCRIPTION
2.1. Presentation
The SCISCAN terminal is a compact Latex and Bar Code reader for Lottery game
application. A thermal printer integrated in the terminal can print receipts
required by the application. The terminal can be connected with a modem or a
[*] connection for "on line" transaction.
2.2. Features
0 Mechanical dimension W X H X D: 170 X 155 X 330 mm
PROCESSOR UNITS:
Main Processor Board: [*]
[*]
<PAGE> 158
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
<TABLE>
<S> <C>
[*] [*]
[*] [*]
[*]
USER INTERFACE MODULES:
LCD Display: [*]
- - Keyboard: [*]
- - Smart card reader (option)
</TABLE>
OTHER MODULES:
I
[*]
<PAGE> 159
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
2.3. General Architecture
Graphic
3. HARDWARE DESCRIPTION
3.1. User interface module The user interface module contains:
* LCD panel
* flex matrix for the keyboard
* control panel board
* 1 to 3 leds,
3.1.1. [*]
[*]
[*] [*]
Line 1
Line 2
Line 3
Line 4 [*]
[*]
3.1.2. Keyboard
The keyboard contains 22 keys:
a numeric pad: 0123456789*#
a function pad: 3 keys
a navigator pad: Cancel Menu OK <-= ~ =>
<PAGE> 160
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
The structure of the keyboard is:
Keys
______ --Rubber key pad
--flex board or PCB
[*]
3.1.3. Control panel board
The architecture is:
[*]
[E MIPU Controller:]
[*]
The chip is programmed to: [*]
<PAGE> 161
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
[*]
[*]
[*]
<PAGE> 162
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
3.2. Processor Boards
3.2.1. Architecture
[*]
<PAGE> 163
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
3.2.2. [*]
[*]
Main Processor
The main processor is [*] The main characteristics are:
[*]
The operating voltage is [*]
Latex Processor
[*]
Main Memory
[*]
Flash Memory
[*]
SRAM Memory
[*]
Serial port
[*]
[*]
The reference clock is generated by [*]
<PAGE> 164
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
[*]
[*]
[*]
Latex reader interface
[*]
3.2.3. SCPFAX board
[*]
PFAX Processor
The PFAX includes several functions:
[*]
Graphic
[*]
[*]
[*]
[*]
[*]
Printer interface
[*]
<PAGE> 165
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
[*]
Communication interface
The communication interface of SCPFAX board with the external of the SCISCAN
Terminal is of [*] types:
m Modem [*] - Data and Phone line interface.
a [*]
<PAGE> 166
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
[*]
m Modem [*] main features:
- - [*]
[*]
- - [*]
[*]
- - [*]
Phone Line interface electronic
[*]
[*]
[*]
3.2.4. [*] Interfaces
There are [*] interfaces between the [*]
- [*]
[*]
[*]
[*]
3.3. Barcode Reader
Technology: [*]
Label density: [*]
<PAGE> 167
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
Scan rate: [*]
3.4. Narrow Thermal Printer: STANDARD
- - Technology [*]
- - Paper Type
- - Paper Width:
- - Print Width:
- - , Print Speed:
- - Dimensions:
- - Weight:
- - Cutter:
- - Horizontal Resolution: [*]
- - Vertical Resolution: [*]
- - Sensors [*]
- - Power: [*]
- - Reliability [*]
- - Paper Roll Diameter: [*]
- - Others : [*]
I
3.5. Wide Thermal Printer: OPTIONAL
- - Technology: [*]
<PAGE> 168
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
- - Paper Type : [*]
- - Paper Width:
- - Print Width:
- - Print Speed:
- - Dimensions:
- - Weight: [*]
- - Cutter:
- - Horizontal Resolution: [*]
- - Vertical Resolution [*]
- - Sensor: [*]
- - Power: [*]
- - Reliability [*]
- - Paper Roll Diameter: [*]
- - Others : [*]
3.6. Latex reader
To Be specified
3.7. [*]
To Be specified
3.8. Power Supply
[*]
The characteristics are:
- Input voltage: [*]
- Input frequency: [*]
- Power max: [*]
- Output voltage: [*]
[*]
<PAGE> 169
NOTE: THE MATERIAL HEREIN MARKED BY BRACKETS AND AN ASTERISK HAS BEEN DEEMED
CONFIDENTIAL BY SCIENTIFIC GAMES HOLDINGS CORP. AND HAS BEEN FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
4. SOFTWARE DESCRIPTION
4. 1. Main Processor [*] :
4. 1. 1. Operating system :
[*] It is developed by SGI.
4.1.2. Program application
All software of [*] is developed by SGI.
4.2. Fax Processor :
4.2. 1. Operating system:
m NUCLEUS.
It is developed by SAGEM.
4.2.2. Program application:
The following drivers are developed by SAGEM on PFAX processor:
[*]
a Protocols supported by SAGEM on PFAX processor
[*]
<PAGE> 170
ANNEX 2: INITIAL ORDER
This Annex sets forth the terms and conditions governing the Initial Order:
1. Quantity of SciScan Terminals ordered
The Initial Order shall be for 15,000 SciScan Terminals.
2. Delivery Schedule for SciScan Terminals
TO being the acceptance date of the order by SAGEM
Stages/
<TABLE>
<S> <C>
- - 2 prototypes TO + 5 months
- - lot of 100 terminals (pre-production) TO + 6 months
- - lot of 250 terminals TO + 8.5 months
- - lot of 750 terminals TO+ 10 months
- - the quantities of the following lots may be adjusted by mutual accord
according to the needs of the Client (between 1000 and 2500 terminals per
month, excluding August)
</TABLE>
3. Price of SciScan Terminals
The price of each SciScan Terminal is defined in Annex 3.
4. Payment Methods
The invoices shall be paid in accordance with Article 5.2 of Annex 19 of the
Contract.
The place of payment shall be indicated by the invoices.
<PAGE> 171
ANNEX 3: PRICE (EXCLUSIVE OF TAXES) OF SCISCAN TERMINALS
I. Price EXW of SciScan Terminals during the production cycle.
1.1. Initial Terminal order of 15,000 (units)
Terminal with 14.4 Kb/s, with CCD SAGEM *r code reader and associated decoder
- - Unit Price FRF (excluding taxes) 4000
Options:
<TABLE>
<S> <C> <C>
- - reader of card with microchip Unit Price FRF (excluding taxes) 120
- - small screen player Unit Price FRF (excluding taxes) 200
- - synchronous X25 port Unit Price FRF (excluding taxes) 48
</TABLE>
1.2. Terminals after Initial Order with CCD SAGEM
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Quantities 1000- 5000-9999 10,000
4999 and over
SciScan 2000-3 With 14.4 Kb/s Unit Price FRF 4328 4104 4000
modem (excluding taxes)
Options: Reader of card Unit Price FRF 132 126 120
with microchip (excluding taxes)
Small screen Unit Price FRF 214 208 200
player (excluding taxes)
Synchronous Unit Price FRF 21 49 48
X25 port (excluding taxes)
</TABLE>
2. Price EXW of SciScan Terminals outside of the production cycle.
In case of stoppage of production due to lack of demand, the price of the first
500 terminals ordered shall be increased by 4%.
The foregoing prices during the production cycle shall apply to the Initial
Order.
<PAGE> 172
ANNEX 4: RATES (EXCLUSIVE OF TAXES) FOR REPLACEMENT
COMPONENTS AND AFTER-SALE SERVICES
1. During mass production periods of equipment of this type
<TABLE>
<CAPTION>
Module Price Price of Standard Exchange
FRF (excl. tax) FRF (excl. tax)
<S> <C> <C>
ELAN card 2000 800
PFAX card without 750 300
synchronous X 25
PFAX Card with synchronous 813 325
X 25
Laser reader module To be furnished later To be furnished later
CCD SAGEM reader module 338 135
Latex detection module 150 Non-repairable
Printer 300 Non-repairable
LCD Terminal Screen 200 Non-repairable
Feeder 250 Non-repairable
Cover for the keyboard 150 Non-repairable
Reader for card with 150 Non-repairable
microchip
LCD player Screen 267 Non-repairable
</TABLE>
2. After production run periods for equipment of this type
<TABLE>
<CAPTION>
Module Price Replacement Price
FRF (excl. tax) FRF (excl. tax)
<S> <C> <C>
ELAN card 2900 1160
PFAX card without 1088 435
synchronous X 25
PFAX card with synchronous 1178 471
X 25
Laser reader module To be furnished later To be furnished later
CCD SAGEM reader module 489 196
Latex detection module 218 Non-repairable
Printer 435 Non-repairable
LCD Terminal Screen 290 Non-repairable
Feeder 363 Non-repairable
Cover for the keyboard 218 Non-repairable
Reader for card with 218 Non-repairable
microchip
LCD player Screen 387 Non-repairable
</TABLE>
<PAGE> 173
The following reductions shall be applicable according to the amount of
peripheral components ordered:
<TABLE>
<CAPTION>
Quantity Ordered Reduction
<S> <C> <C> <C>
FRF 0.25M to FRF 0.50 M 5%
FRF 0.50 M to FRF 1.00 M 10%
FRF 1.00 M to FRF 2.50 M 15%
FRF 2.50 M to FRF 5.00 M 20%
FRF 5.00 + 22.5%
</TABLE>
These reductions are not applicable to the replacement price.
Prices quoted above are EXW.
<PAGE> 174
ANNEX 5: ACCEPTABLE QUALITY LEVEL FOR
THE ACCEPTANCE OF TERMINALS
Two categories of defects should first be considered:
Major Defects:
Assembly faults generating short-term equipment breakdown or functional faults.
Minor Defects:
Appearance or assembly defects without impact on the functionality of the
equipment.
Monthly quantity estimated at 1000 - 2000 Terminals, it is expected that there
will be I delivery each week.
The NQA are as follows:
I% for major defects
4% for minor defects
Such [NQA] shall, however, follow the NFX 06 022 (Level H) norms, requiring the
acceptance of lots, the samplings of which have the following defects:
For example:
I% NQA: major defects: Lot accepted with 1 defect and rejected with 2 defects
4% NQA: minor defaults: Lot accepted with 5 defects and rejected with 6 defects
The list of major defects and minor defects shall be established by mutual
agreement between SGI and FDJ.
No critical defect (i.e., one that undermines the safety of the user) shall be
accepted.
<PAGE> 175
ANNEX 6: WORKSHOP MAINTENANCE FOR SCISCAN TERMINALS
Organization Of Arrangements between FDJ And SGI for the Maintenance of SciScan
Terminals
Before any shipping of hardware, FDJ shall fill in the following spaces of the
ARM SAGEML form:
date, shipment (address), facsimile number, telephone number
description
reference of the terminal or part (SAGEM code)
number of the series of the oncerned machinery (origin of the
part) or date-code, e.g., 18/", this information to be stated on a
repairable part, indicating the week and year of manufacture.
Warranty: indicating whether or not included under the warranty,
1 ("HG"- Hors Garantie, or IISG" - Sous Garantie)
FDJ shall transmit by Fax the completed ARM document to the concerned SAGEM
repair service with a copy to SGI.
SGI shall return the ARM to FDJ after indicating an order number, date , name of
manager and address and phone number for the shipment of parts or terminals to
be repaired.
FDJ shall ship the parts to be repaired to the SAGEM Distribution/ Repair Center
indicated by SGI, attaching a copy of the ARM to the package.
SGI is referred to the ARM number for the follow-up and management of the
shipment. This number is to be used for any request for information and in any
correspondence.
N.B. IRREPARIBILITY
The parts returned for repair/ replacement, may be considered irreparable by SGI
and therefore be returned to FDJ as received, in the following cases:
damage caused by a usage contrary to the conditions for normal uses,
receipt of incomplete sub-sets (i.e., missing components, mechanical
parts, etc.) modification of the original state of the hardware.
Attempt at repair having damaged the sub-set.
SGI shall inform the manager in charge of technical service at FDJ.
<PAGE> 176
2. Maintenance of SciScan Terminals
SGI shall, with respect to maintenance of SciScan Terminals, supply to FDJ
replacement equipment as well as component parts and repair facilities.
a) Timetable for Assistance Requests Business days from 8:30 am to 4:30 pm b)
Acknowledgment periods for Assistance Requests Business days from 8:30 am to
4:30 pm c) Intervention Periods
The intervention periods for SAGEM is defined as the period between the business
day in which the defective part is received and the date upon which the repaired
part is sent.
d) Description of Maintenance
Defective modules or parts, or the complete hardware items, shall be returned to
the SAGEM manufacturer for repair with notification to SGI.
Transport and insurance costs of defective modules or parts to the factory shall
be bome by FDJ and the transport and insurance costs of repaired modules shall
be borne by SGI.
In any event and irrespective of the nature thereof, SGI shall implement all
useful and necessary measures so as to resolve technical problems encountered by
FDJ. Such obligation includes, in particular, that of providing appropriate
technical solutions, using qualified and competent personnel as well as the
ensuring timely execution.
Maintenance shall consist of the repair or replacement of defective part in such
manner that the hardware shall at be in an normal state of functionality.
The replaced part need not be new but must be suitable for the use for which it
is intended. The part that is taken back by SGI shall become the property of
SGI.
Replacement, labor costs and costs for shipment to FDJ shall be for the account
of SGI.
SGI shall be required to proceed with the repair of defective parts within 10
business days.
Any and all lateness by SGI in the placing of hardware into working order shall
entitle FDJ to apply the penalties provided for in Section 8 of the present
Annex 19.
The following are excluded from maintenance:
breakdown or dysfunction due to improper use of hardware or non-compliance with
user or installation instructions;
<PAGE> 177
- - breakdown or dysfunction due to a cause external to hardware
(including, but not limited to, knocks, breakage, humidity, accident,
water or other liquid damage, lightning, short-circuit, power supply
faults, acts of vandalism, theft or attempted theft, defective lines
... );
- - normal wear and tear of hardware and accessories;
- - breakdown or dysfunction caused by modifications or add-ons made to
hardware without the written consent of SGI;
- - damage due to failure to maintain in accordance with the user manual or
lack of surveillance or care;
- - damage resulting from repairs or maintenance carried out by non-SGI
approved persons;
- - breakdown or damage caused by the use of consurnables other than those
recommended by SGI;
- - deterioration following or due to insufficient packaging and/or poor
condition of hardware returned to SGI;
transmission faults (telecommunication network) including, but not
limited to, bad geographical coverage by radio-electrical transmitters,
interference linked to weather conditions, or faulty or poor quality
telephone lines, etc. ; and
4D defects caused to hardware by bad environmental conditions.
In the event that a request for assistance emanating from FDJ is not imputable
to SGI (i.e., hardware, Software etc.), SGI shall be entitled to invoice time
spent at the tariffs in force at the date of assistance in addition to travel
expenses.
3. Price of the maintenance
Subject to a use of the Terminals in accordance with the description of the work
profile, SGI shall assure the repair in factory of the defective terminals under
the following conditions:
a) during the 3 years following the warranty period
Price per terminal per year FRF (excluding taxes) 490 b) during the 3
years following
Price per terminal per year FRF (excluding taxes) 700 These prices are
valid if the maintenance of all the terminals are entrusted to SGI.
These prices do not include:
<PAGE> 178
the costs from research of breakdowns in the terminals received and found in a
functional state. The replacement of ruined parts. These costs could be billed
at higher rates.
<PAGE> 179
Autorisation de Retour NI:
de Materiel Date:
NI Site:
Date. i
DESTINATAIRE ARM ADRESSE D'EXPEDITION POUR LES PIECES
(Joindre I'ARM numerote a votre expedition)
<TABLE>
<S> <C> <C> <C> <C>
e Departement Telecopie e
et Telephonie sans fil Service client SAV TELEPHONIE SANS Fil
Z.I. de la Guenaudiere Z.I DE QUEVERT B.P 130
Service Gestion des Reparations 2, rue de la Lande du Bas
4, rue du petit ALBI 35300 FOUGERES 22103 DINAN CEDEX
B.P. 8448
95807 CERGY PONTOISE CEDEX e e
FRANCE Service Distribution et Reparation SAV Monetique
Boulevard Lenine - B.P. 428 278, Chaussee Fernand Fore
Fax: 01 40 70 84 73 76805 ST ETIENNE DU ROUVRAY 59203 TOURCOING
EXPEDITEUR:
Date d'arrivee Date de reexpedition
Service Reparation Fax: Service Reparation
Date:
NI DP: Tel:
</TABLE>
LISTE DES MATERIELS RETOURNES
<TABLE>
<CAPTION>
N* SERIE TIE
DESIGNATION CODESAGEM ou S.G.
DATE CODE (inventaire)
TOTAL HT
<S> <C> <C> <C>
<< Bon pour acceptation du devis , Date: Votre NI de commande:
Signature:
en cas d'accord ou de refus)
</TABLE>
<PAGE> 180
ANNEX 7: PRINCIPAL COORDINATOR AND ASSISTANT FOR EACH PARTY
<TABLE>
<S> <C>
For FDJ:
Principal Coordinator: Bruno Moyrand
Assistant : R6mi Theys
For SGI:
Principal Coordinator: Tyler M. Ryan
Assistant: Christian Radakovitz
</TABLE>
<PAGE> 181
ANNEX 8: PERFORMANCE REQUIREMENTS
1. Definition of the- work profile of the terminal
Normal environment
Under tension 24 hours a day
Number of tickets read per year on average by all the terminals: 16, 700.
Printer: 2 krn of paper per year
2 million elementary impulses of writing
The preventative maintenance, by the operator, of the ticket reader module is
carried out according to the recommendations of SGI.
2. Reliability of the Terminal
In the context of the work profile defined hereabove the reliability shall be ,
after a period of deployment of the field, better than:
0.8 breakdowns per year and per machine using the 4 years following the
delivery of the terminal,
I breakdown per year and per machine during the 3 years following.
These figures are bases on the fact that the latex detection part represents
less than
10% of the breakdowns.
<PAGE> 182
SCISCAN LOTTERY TERMINAL PURCHASE AGREEMENT
BETWEEN THE UNDERSIGNED
SAGEM S.A., a French Societe anonyme, having a share capital of FRF 210,502,900,
whose registered office is located at 6 avenue d'Iena, 75016 Paris, registered
with the Register of Commerce and Companies under number B 562 082 909,
Represented by the President Directeur General, Mr. Pierre Faurre, or by Mr. Guy
Rouanne, Executive V.P., Managing Director, Terminals and Telecommunications
Division.
(hereafter referred to as "SAGEM")
AND
SCIENTIFIC GAMES INC., a US corporation, organized and existing under the laws
of the state of Delaware, United States of America, doing business at 1500
Bluegrass Lakes Parkway, Alpharetta, Georgia 30004,
Represented by its Chairman and Chief Executive Officer, Mr. William Malloy,
(hereafter referred to as "SGI");
<PAGE> 183
TABLE OF CONTENTS
<TABLE>
<S> <C> <C>
1. DEFINED TERMS AND REFERENCES .......................................................................4
1.1 Definitions ...............................................................................4
1.2 Interpretation ............................................................................4
2. PURPOSE ............................................................................................5
3. EFFECTIVE DATE - TERM ..............................................................................5
4. MANUFACTURING LICENSE ..............................................................................5
5. SAGEM'S LICENSE ....................................................................................6
6. ORDERS - TERMS AND CONDITIONS OF ORDERS ............................................................6
7. PRICE AND PAYMENT METHODS ..........................................................................7
7.1 Price .....................................................................................7
7.2 Invoicing .................................................................................7
7.3 Currency ..................................................................................8
8. DELIVERY TERMS .....................................................................................8
9. QUALITY CONTROL ....................................................................................8
10. PENALTIES .........................................................................................9
11. ACCEPTANCE OF THE SCISCAN TERMINALS ..............................................................10
11.1 Acceptance Procedure ....................................................................10
11.2 Establishment of an acceptance procedure ................................................10
11.3 Method of acceptance ....................................................................11
11.4 Events Affecting Acceptance .............................................................11
12. WARRANTY .........................................................................................12
12.1 Warranty in respect of the sciscan Terminals ............................................12
12.2 Infringement ............................................................................13
13. TERMINAL MAINTENANCE .............................................................................14
14. AFTER-SALE SUPPLY OF SPARE PARTS .................................................................14
15. CLEARANCE FOR TERMINALS ..........................................................................15
16. MARKINGS ON TERMINALS ............................................................................15
17. DOCUMENTATION ....................................................................................15
18. LIABILITY ........................................................................................16
18.1. Liability ..............................................................................16
18.2. Limitation of Liability ................................................................16
19. LIEN - COMPENSATION ..............................................................................16
20. INSURANCE ........................................................................................16
21. PERSONNEL ........................................................................................17
22. FORCE MAJEURE ....................................................................................17
23. TOOLING ..........................................................................................17
24. SGI'S RESUMPTION OF THE MANUFACTURING PROCESS ....................................................18
25. TERMINATION ......................................................................................19
26. ASSIGNMENT .......................................................................................19
27. SUBCONTRACTING ...................................................................................19
28. CONFIDENTIALITY ..................................................................................20
29. ADMINISTRATIVE STEPS .............................................................................21
30. LANGUAGE .........................................................................................21
31. ENTIRE AGREEMENT .................................................................................21
32. NO WAIVER ........................................................................................21
33. AMENDMENT ........................................................................................21
</TABLE>
<PAGE> 184
<TABLE>
<S> <C>
34. PUBLICITY ........................................................................................22
35. INTERPRETATION ...................................................................................22
36. INDEPENDENCE OF THE PARTIES ......................................................................22
37. HEADINGS .........................................................................................22
38. GOVERNING LAW AND DISPUTES .......................................................................22
38.1 Governing Law ...........................................................................22
38.2 Arbitration .............................................................................22
38.3 Choice of Domicile and Jurisdiction .....................................................23
38.4 Notice ..................................................................................23
39. CONDITION PRECEDENT ..............................................................................24
</TABLE>
LIST OF ANNEXES
ANNEX 1 Specifications of the SciScan Terminals and Spare Parts
ANNEX I bis Tasks to be performed by each Party
ANNEX 2 Initial Order
ANNEX3 Price (Exclusive of Taxes) of SciScan Terminals
ANNEX4 Rates (Exclusive of Taxes) for Replacement Components and After-Sale
Services
ANNEX5 Acceptable Quality Level for the Acceptance of Terminals
ANNEX6 Maintenance Workshop for SciScan Terminals
ANNEX7 Principal Coordinator and Assistant for Each Party
ANNEX8 Performance Requirements
ANNEX 9 Equipment List
ANNEX 10 List of Intellectual Property Rights.
ANNEX 11 Specifications For Tickets To Be Validated By The SciScan Terminal
3
<PAGE> 185
PREAMBLE
WHEREAS, SGI has conceived and developed a SciScan Terminal;
WHEREAS, La Francaise des Jeux has requested SGI to furnish a complete lottery
system including SciScan Terminals modified for the Fortuna System (these
terminals thus modified are referred to as the SciScan Terminals);
WHEREAS, SGI would like SAGEM to perform research and development with respect
to the SciScan Terminals as well as the Manufacturing of the SciScan Terminals;
THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. DEFINED TERMS AND REFERENCES
1.1 Definitions
Agreement means this Agreement including the annexes hereto;
Initial Order has the meaning given to it in Section 6;
EXW is an Incoterm signifying "at the factory" and has the meaning given to it
in Section 8;
NOA means the level of acceptable quality for the receipt of SciScan Terminals,
as such term is used in Annex 5-,
Party or Parties refers to SGI or to SAGEM as the context may require.
SciScan Terminal is defined in Section 2;
1.2 Interpretation
In this Agreement:
(a) defined terms, unless the context requires otherwise, when referenced
in the singular shall include reference to the plural;
(b) headings and the use of bolded characters shall be ignored; and
(c) all references to a section, sub-section or annex shall, unless
expressly provided otherwise, be reference to a section, sub-section or
annex of this Agreement.
<PAGE> 186
2. PURPOSE
This Agreement sets forth the general terms and conditions pursuant to which:
SGI grants to SAGEM a non-exclusive license, to be used exclusively for the
performance of this Agreement, including the intellectual property and know-how
possessed by SGI necessary to the manufacture of lottery gaming terminals
according to the specifications of Annex I (hereafter the "SciScan Terminals").
SAGEM agrees to perform the research and development as well as the manufacture
and sale to SGI of the SciScan Terminals according to the specification set
forth in Annex 1.
3. EFFECTIVE DATE - TERM
This Agreement shall become effective as of the date of signature hereof by the
Parties and shall remain in effect for an indefinite period. Following
fulfillment of the Initial Order (as defined in Section 6, this Agreement may be
terminated at any time by either of the Parties upon giving nine (9) months
prior written notice to the other Party.
In the event of termination, orders remaining unfulfilled at the effective date
of termination shall be fulfilled and shall continue to be governed by the terms
and conditions of this Agreement.
4. MANUFACTURING LICENSE
SGI grants to SAGEM, free of charge, a non-exclusive license to use, adapt,
reproduce and modify the intellectual property rights, plans, documents and
other information necessary to the manufacture of the SciScan Terminals.
This license is granted only for the manufacture, adaptation and modification of
the SciScan Terminals at the sole request of SGI or of derived products of which
the development has been decided by common agreement between the Parties.
Annex 10 lists the intellectual property rights, plans, documents and other
information necessary for the manufacture of the SciScan Terminals as well as
the deadlines with respect to the communication of these documents to SAGEM. Any
lateness with respect to the communication of these documents to SAGEM shall
give rise to a corresponding extension of time with respect to delivery
deadlines. All incomplete documents that cannot be immediately used by a
professional shall be considered as late.
5
<PAGE> 187
Furthermore, SGI will furnish SAGEM, free of charge, by all appropriate
reasonable means, any assistance, and additional information eventually
necessary for the manufacture of the SciScan Terminals.
5. SAGEM's LICENSE
SAGEM grants to SGI, free of charge, a license of use for all intellectual
property rights concerning all elements integrated in the SciScan Terminal
resulting from research and development performed by SAGEM, the use of which is
protected under applicable law and which elements are listed in Annex 10 (the
"SAGEM Elements") insofar as the SAGEM Elements are contained in the SciScan
Terminals manufactured by SAGEM.
As soon as possible, SAGEM and SGI shall agree to a license for use,
reproduction, modification, and adaptation of the SAGEM Elements for the
duration of the period that the SAGEM Elements are protected by intellectual
property laws in order to allow the use of-the SAGEM Elements in the event that
SAGEM does not provide the SciScan Terminals. -The fees for such license shall
be calculated on the basis of the costs for the research -and development in
question, which costs are estimated to be approximately US$900,000 as of the
date hereof and which costs shall be substantiated by SAGEM by appropriate
evidence. Such license shall be granted for the sole purpose of Manufacturing
SciScan Terminals.
6. ORDERS - TERMS AND CONDITIONS OF ORDERS
Subject to the provisions of Section 39, the signature of this Agreement
constitutes the initial order of SciScan Terminals (the "Initial Order") subject
to and in accordance with the terms and conditions set forth in Annex 2.
Orders placed by SGI after the Initial Order must make explicit reference to
this Agreement, give the reference to the SciScan Terminal, the type, the
quantity and the delivery date requested for the SciScan Terminals, by way of
notification in accordance with this Agreement.
SAGEM undertakes to acknowledge orders within ten (10) days of receipt of an
order or to inform SGI within such period of any difficulty related to the
delivery dates specified in the order.
After said period of ten days following the receipt of an order, and in default
of an acknowledgment or statement of reservations, orders shall be deemed
accepted in accordance with the terms and conditions set forth on any such
order, provided that the same shall comply with the terms and conditions of this
Agreement, and provided further that such order had been notified in accordance
with this Agreement stating the consequences of failure to respond.
<PAGE> 188
Orders in respect of spare parts shall be placed in the same manner as those in
respect of SciScan Terminals.
7. PRICE AND PAYMENT METHODS
7.1 Price
The price of SciScan Terminals shall be as indicated in Annex 3 hereto.
SAGEM shall use its best efforts to permit SGI to benefit from eventual
decreases in price that SAGEM shall experience concerning electronic components
as well as any market development with respect to third parties that would allow
a reduction in price of the product.
In any event, should SAGEM wish to upwardly revise the price, it shall be
required at the time of seeking agreement from SGI, to justify and supply the
reasons leading it to increase the price. For such purposes, SAGEM shall, in
particular, be required to demonstrate that it shall not profit from the
decrease in prices in the electronics market and that the import taxes payable
by SGI with respect to such electrical components have not decreased.
In any event, as long as the Parties disagree on the change of price, the price
set forth in Annex 3 shall continue to apply.
7.2 Invoicing
Payment shall be made as follows:
1, 25% of the total order when each order is placed.
9 The balance at the signature of each acceptance form as set forth in Article
11.
The sums due shall be paid excluding taxes or including taxes according to the
applicable tax regime at the time.
All payments shall be made (without deduction) on the 10th of the month
following a period of thirty (30) days from the date of issuance of the invoice.
Any sums remaining unpaid after the contractual deadline shall automatically
accrue late payment interest equivalent to one and one half times the legal
interest rate not to exceed the maximum rate permitted by law, from the day
following the expiration of the deadline to the date of payment.
Furthermore, SAGEM shall have the right to suspend deliveries in the event that
SGI shall not respect its payment obligations.
<PAGE> 189
7.3 Currency
For all purposes and in accordance with the principles of monetary laws, it is
hereby acknowledged that amounts payable in French Francs under this Agreement
shall be deemed denominated and/or payable in European currency, when the French
Franc is no longer the lawful currency or, more generally, is replaced by the
European currency in accordance with applicable European and/or French
regulations. The rates used to convert the French Franc at such time shall be
those provided pursuant to article 109L of the Treaty on the European Union.
S. DELIVERY TERMS
SciScan Terminals shall be delivered Ex Works, SAGEM, Saint-Etienne du Rouvray
in accordance with the planning set forth in Annex 3.
The Parties agree that, unless specifically provided otherwise in this
Agreement, the Incoterm "EX WORKS - EXW", by its 1990 definition by the ICC,
shall be applicable to all deliveries of SciScan Terminals.
All deliveries shall be packed on wooden pallets with plastic film wrappings.
All deliveries made to SGI shall be made with a delivery note setting forth the
necessary details and references for the identification of deliveries.
Partial or rescheduled deliveries (limited to a maximum of thirty (30) days)
shall require the prior agreement of SGI.
Transfer of title in and to the SciScan Terminals shall take place upon payment
of the full price in respect thereof.
Annex I biS provides the tasks to be performed by SAGEM and SGI in the context
of this Agreement.
9. QUALITY CONTROL
SAGEM warrants and undertakes that it shall apply a quality control system in
respect of each stage of production, guaranteeing the high quality of SciScan
Terminals to be delivered to SGI.
The factories producing the SciScan Terminals shall be ISO 9002 certified or
shall use similar procedures as those required by ISO 9002. The research centers
responsible for SciScan Terminals shall be ISO 9001 certified or shall use
similar procedures as those required by ISO 9001.
<PAGE> 190
SGI hereby reserves the right to verify that such quality control system is
being applied, provided that it shall comply with the security and access
regulations of SAGEM.
10. PENALTIES
The Parties agree that in the event of late delivery of (i) more than ten (10)
business days or (ii) any delay in supplying maintenance or guarantee services,
SGI shall be entitled to impose penalties under the conditions described
hereafter.
In the event that SGI decides to impose late delivery penalties upon SAGEM, such
penalties shall run from the end of the tenth business day following (i) the day
that one or more SciScan Terminals should have been delivered in accordance with
the agreed dates for delivery, or (ii) the day on which the maintenance or
guarantee services should have been completed.
Penalty formula
P=NxJxV
1000
Letters in the above formula are defined as follows:
P Amount of penalty in Francs;
i Number of days late (following deduction of ten (10) business
days allowance);
N Number of SciScan Terminals delivered late;
V Price in French Francs of the SciScan Terminal, before options
or of replacement part or of any other service provided for
herein.
The Parties agree that late delivery penalties and penalties delay in supplying
maintenance or guaranty services for delivery of non-conforming or defective
SciScan Terminals shall be cumulative.
The Parties hereto hereby agree that penalties hereunder, irrespective of cause,
may not exceed 15% of the total value of the order in question.
Penalty payments due may be set off against current or future SAGEM invoices. To
the extent that SAGEM makes up for late deliveries in subsequent deliveries
under this Agreement, retained penalties shall be reimbursed to SAGEM.
Beyond a 90 day delay exceeding the dates set in the delivery schedule, SGI
shall be entitled to terminate the Agreement in accordance with the provisions
of Article 25.
Payment of the penalty by SAGEM is not due if the delay is attributable to force
majeure or to SGI.
9
<PAGE> 191
Any delay attributable to SGI shall lengthen the time allotted to SAGEM for a
period of time which will not exceed such delay; moreover, SAGEM shall be
entitled to charge SGI for reimbursement, with supportive evidence, for expenses
born by SAGEM with respect thereto.
11. ACCEPTANCE OF THE SCISCAN TERMINALS
11.1 Acceptance Procedure
The factory acceptance shall be the only acceptance, and may be conducted in
presence of La Francaise des Jeux.
The SciScan Terminals must be accepted before delivery.
SGI shall proceed with the acceptance of the Terminals within a deadline of five
(5) business days from the receipt of the notice that the Terminals are ready
for acceptance.
Attached as Annex II are specifications for the tickets to be validated by the
SciScan Terminal. The acceptance procedures for SciScan Terminals shall include
appropriate testing to determine that the SciScan Terminals for which acceptance
is requested are able to consistently validate tickets produced in accordance
with such specifications.
11.2 Establishment of an acceptance procedure
SGI shall supply within one month from the signing of this Agreement two draft
acceptance procedure specifications one for the pre-series terminals and one for
the series. These drafts will permit SAGEM to prepare and notify to SGI
counter-draft acceptance procedure forms that shall be sent to SGI within 90
calendar days.
The Parties shall have a period of fifteen (15) business days following the
notification to SGI of the counter-draft acceptance form in order to agree on
the contents, approve the provisions and sign a copy thereof. The completed
acceptance specifications so signed and approved shall form an integral part of
this Agreement.
The Parties hereto may provide, by mutual agreement, for complementary tests
that may have been omitted at the time of the establishment of the completed
acceptance specifications.
The level of acceptance testing requested shall not exceed the specifications
set forth in Annex
For purposes of the acceptance, the quality levels of Annex 5 shall apply.
If the Parties do not reach an agreement on the contents of the acceptance
procedure specifications before the deadlines indicated above, such form shall
be drafted by an expert nominated by mutual agreement from the Paris Appellate
Court list of judicial experts. In the event that the Parties are unable to
reach an agreement with respect to an expert, the expert
<PAGE> 192
shall be named by the President of the Paris Commerce Tribunal (President du
Tribunal de Commerce de Paris) upon petition of the most diligent Party.
11.3 Method of acceptance
For the acceptance of the SciScan Terminal, SAGEM shall make available to SGI
the infrastructure and human resources so as to facilitate the expeditious
carrying out of testing and acceptance.
SAGEM shall make available to SGI all testing procedures and specific tools
necessary for the performance of acceptance testing.
SGI shall provide to SAGEM a simulator with access to the central site as
necessary for the acceptance procedure.
The representatives of the Parties present during the acceptance procedures
shall have -the power to bind the Party that he represents, in particular, for
the purposes of carrying out the testing and the technical and functionality
trials, and to individually sign the acceptance forms, with or without
reservations.
11.4 Events Affecting Acceptance
In the event that SGI does not participate in the acceptance procedure within
the deadlines set out in Section 10.1, SAGEM shall put SGI on notice to accept
the terminals in question.
If SGI does not respond to within five (5) business days from the receipt of
such notice, the acceptance shall be deemed automatically to have taken place,
and SAGEM shall be authorized to sign acceptance forms on behalf of SGI.
If the Terminals fail to pass the acceptance tests, a second acceptance
procedure shall be carried out within ten (10) business days following the first
attempt.
In the event of failure of the second attempt at acceptance, SGI may proceed to
a new acceptance attempt in agreement with SAGEM or commence a period of
negotiation of fifteen (15) days from the date of notification of refusal by
SGI.
Changes relating to the acceptance criteria, to dates, to the price or to other
terms and conditions, in addition to the agreement relating to the completed
acceptance form relating to such elements, shall be formalized by the signature
of an amendment to this Agreement at the end of the period of negotiation.
If the Parties are unable to reach agreement during the period of negotiation,
either Party shall be entitled to rely upon the provisions of Section 25 of this
Agreement.
<PAGE> 193
12. WARRANTY
12.1 Warranty in respect of the SciScan Terminals
SciScan Terminals are warranted with respect to both materials and workmanship
for a period of twelve (12) months from the date of installation and/or a
maximum of fifteen (15) months from the date of delivery.
In addition to the warranty against hidden defects provided for in Article 1641
of the Civil Code, under which SAGEM is responsible, SAGEM gives the contractual
warranties provided for below.
The warranty shall consist of the repair or exchange of the defective component
at the factory or workshop designated by SAGEM in such manner that the SciScan
Terminals shall always be in an acceptable state of functionality.
The exchanged component need not be new, but must be fit for the purpose for
which it- is destined. The replaced component shall become the property of
SAGEM.
Replacement, labor and transport costs of the repaired or replaced components to
a location specified by SGI shall be borne by SAGEM. Any other relevant costs
shall be borne by SGI.
SAGEM shall be required to return defective SciScan Terminals in working order
within 10 business days (on an average calculated monthly, it being understood
that only the Terminals or components sent back after repair or replacement will
be considered for the purpose of calculating the average)
Any delay of SAGEM in putting each SciScan Terminal back in a state of working
order shall entitle SGI to impose upon SAGEM the penalty payments provided for
in Section 10.
Terminals will be sent to SAGEM on a regular basis.
The following are excluded from the warranty:
breakdown or dysfunction due to improper use of the SciScan Terminal or
noncompliance with user or installation instructions;
breakdown or dysfunction due to software bugs or failures in the SciScan
technology licensed to SAGEM;
breakdown or dysfunction due to an external cause (including, but not limited
to, knocks, breakage, accident, humidity, water or other liquid damage,
lightning, short-circuit, power supply faults, acts of vandalism, theft or
attempted theft, defective lines);
* normal wear and tear of the SciScan Terminal and its accessories;
<PAGE> 194
- breakdown or dysfunction caused by modifications or add-ons
made to a SciScan Terminal without the written consent of
SAGEM;
- damage due to failure to maintain in accordance with the user
manual or lack of surveillance or care;
- damage resulting from repairs or maintenance carried out by
non-SAGEM approved persons;
- deterioration following or due to insufficient packaging
and/or poor condition of equipment returned to SAGEM;
- transmission faults (telecommunication network) including, but
not limited to, bad geographical coverage by radio-electrical
transmitters, interference linked to weather conditions, or
faulty or poor quality telephone lines; and
- defects caused to a SciScan Terminal by bad environmental
conditions.
Where the request for intervention addressed by SGI is not attributable to
products delivered by SAGEM (i.e., hardware, software, etc.), SAGEM shall be
entitled to invoice in accordance with its rates in force at the time of
intervention.
Should SAGEM and SGI, and their respective technicians, disagree upon the
application of any of the foregoing warranty exclusions, SAGEM and SGI shall
jointly appoint an external consultant, for the purpose of resolving their
dispute within 15 days. The consultant will allocate the resulting expenses
depending on the merit of the claims of each Party. The decision of the
consultant shall bind the Parties and be definitive.
12.2 Infringement
SAGEM guarantees to SGI that the SAGEM Elements as well as all the elements
manufactured by SAGEM and included in the SciScan Terminals (other than those
licensed by SGI to SAGEM in accordance with Section 4 o not infringe any
intellectual property rights, as defined under the French Intellectual Property
Code. Accordingly, if the infringed right is held by SAGEM, SAGEM shall be
responsible for all court costs, expert costs, as well as all damages and
interests that SGI may incur.
SGI guarantees to SAGEM that the SciScan technology licensed to SAGEM in
accordance with Section 4 does not infringe any intellectual property right of a
third party and shall be responsible for all court costs, expert costs, as well
as all damages that SAGEM may incur.
Furthermore, SAGEM must offer to substitute a non infringing element for any
infringing element, and SGI must offer to substitute a non infringing element
for any infringing element.
The Parties undertake to promptly notify each other in writing of any
infringement claims as soon as they become aware of any such claim.
13
<PAGE> 195
13. TERMINAL MAINTENANCE
SAGEM shall offer to SGI, for a flat fee per SciScan Terminal per year, workshop
maintenance for the SciScan Terminals described in Annex 6 during a minimum
period of seven (7) years. This price is established in function of the
performance requirements in Annex 8. If SGI issues the request by registered
mail return receipt requested, at least six (6) months before the expiration of
the contractual warranty defined in Section 12 of the Agreement, SGI and SAGEM
shall sign a maintenance agreement for a period of one (1) year, that shall be
automatically renewed unless expressly terminated by either Party with three
months notice, until the expiration of a period of seven (7) years, such
agreement to incorporate and be subject to the terms, conditions and methods set
forth in Annex 6.
The fee proposed by SAGEM for maintenance of the SciScan Terminals shall conform
to the price set forth in Annex 6. Such fee shall be indexed-linked, as of the
end of the first year of maintenance, to the SYNTEC index by application of the
adjustment formula set forth in Annex 6.
SAGEM is not obligated to propose field maintenance.
14. AFTER-SALE SUPPLY OF SPARE PARTS
At the end of the contractual warranty period, if no maintenance contract as
described in Section 13 above has been signed, or in the event that the warranty
is excluded, SAGEM shall supply SGI with replacement equipment and parts (i.e.,
cards and modules), in accordance with Annex 4 for a minimum period of seven (7)
years from the date of the last delivery of SciScan Terminals to SGI. During
such period, the price of parts may be adjusted annually from the expiration
date of the warranty period in respect of the Initial Order in accordance the
identical procedure set forth in Section 7 of this Agreement.
As soon as it becomes aware of the same, SAGEM shall alert SGI as to those
components that are liable to either disappear from the market or become
obsolete. In such event, SAGEM shall use its best efforts to propose technical
solutions to SGI in order to resolve the problem(s) linked to the disappearance
or obsolescence of such components. If any such solution is adopted by SGI,
SAGEM shall ensure that parts or modules are supplied that permit increased
compatibility with the SciScan Terminals. Research and development costs shall
be considered on a case by case basis.
The quantities of replacement components and the financial terms in respect
thereof shall be established by mutual agreement by reference to the actual MTBF
of each module.
<PAGE> 196
15. CLEARANCE FOR TERMINALS
SAGEM shall deliver SciScan Terminals having obtained prior to their delivery
all necessary clearances for their use in France, and respecting the applicable
standards and regulations on their delivery date, and in particular:
- - EN 60950 (electrical security)
- - EN 55022 (CEM)
- - EN 50082-1 (CEM) 41 B 1123 A (telephone network access)
16. MARKINGS ON TERMINALS
SciScan Terminals with FDJ as end user shall be branded with the name "La
Francaise des Jeux" as set forth in the purchase orders.
The marking films (films de marquage) must be supplied to SAGEM three (3) months
before the delivery.
17. DOCUMENTATION
SGI shall furnish to SAGEM:
* French user guide; 4o French installation guide.
SAGEM shall supply maintenance instructions related to the SciScan for
incorporation in the maintenance guide to be supplied by SGI. The instructions
shall be supplied in French in ten copies.
Each Party shall be responsible for the information it shall furnish.
In addition, SAGEM shall provide SGI ten (10) copies of the technical
information related to the SciScan Terminals, so that SGI may undertake the
maintenance of its SciScan Terminals by itself, if it elects to do so.
<PAGE> 197
18. LIABILITY
18.1. Liability
SAGEM shall perform the obligations undertaken by it under this Agreement
subject to and in accordance with professional standards prevailing in its
industry and all applicable regulations, and, in particular, with the Labor Code
(Code du Travail and the Intellectual Property Code (Code de la Propiete
Intellectuelle). SGI shall be solely liable with respect to regulations
specifically applicable to SGI's activities.
To the extent, that due to the performance or non-performance of the obligations
under this Agreement, SGI is able to show that it has suffered loss, it shall,
where there has been proven default by SAGEM, be entitled to claim damages
subject to the provisions set forth below in the Section entitled "Limitation of
Liability".
18.2. Limitation of Liability
SAGEM is responsible for proven breaches under this Agreement, and shall
indemnify SGI for direct damages within the limit of the total price of the
SciScan Terminals ordered pursuant to this Agreement. SAGEM shall not be
responsible for indemnifying SGI for consequential damages or indirect damages
including, without limitation as lost profits or loss of clientele.
SAGEM shall, in no event, be liable for any loss due to the non-performance by
SGI of all or part of its obligations as set forth in this Agreement.
19. LIEN - COMPENSATION
Neither Party is permitted to exercise any lien or right to compensation with
respect to the other Party without having obtained either such Party's
authorization or an enforceable arbitration order.
20. INSURANCE
SAGEM warrants that it has sufficient insurance cover to cover its professional
responsibility and shall justify the same upon request by SGI.
<PAGE> 198
21. PERSONNEL
Personnel that are engaged by SAGEM to work upon equipment, facilities and/or
sites of SGI shall remain at all times in the employ of SAGEM, with regard to
which it shall bear all employer obligations. SAGEM shall hire, manage and
remunerate only its own personnel and shall be solely responsible for the
management, discipline and the security of said personnel. Where SAGEM is
engaged on SGI sites, SAGEM personnel shall be required to conform to the
Internal Regulations and to the security standards in force at SGI
establishments where it carries out its engagements.
22. FORCE MAJEURE,
The Parties hereto shall not bear liability in respect of lateness or
non-performance of obligations under this Agreement caused by an event of force
majeure.
The expression "force majeure" means any event exterior to and not within the
control of the
i -
Parties that is unforeseeable and which prevents the performance of the
obligations under this Agreement, in whole or in part, or renders the
performance thereof excessively onerous or difficult for either one of the
Parties.
Events of force majeure are deemed to include, without limitation, the
following: natural disasters, acts of war, political unrest, strikes,
governmental edicts (including, without limitation, the repeal of statute or
regulations allowing the exploitation of games of chance in France) or the
imposition of taxes, if the latter has the effect of materially affecting the
performance of this Agreement.
It is expressly agreed that an event of force majeure shall result only in the
suspension of the obligations of either Party under this Agreement only during
the period in which such event has effect. The Party seeking to rely on the
provisions hereof is required to notify the other Party subject, and in
accordance with the provisions hereof.
Suspension of this Agreement may not, however, exceed three (3) months from the
date of receipt of the above-mentioned notice. At the expiration of said period,
the Parties shall meet so as to mutually agree to the termination of this
Agreement, on the basis of a payment made to SAGEM on a pro rata basis for work
done. In the absence of agreement, the most diligent Party may demand
termination hereof by court order.
23. TOOLING
SGI who possesses certain necessary tooling for the production of SciScan
Terminal, agrees to make them available to SAGEM. This availability shall
constitute a free loan governed by the provisions of Articles 1875 and 1891 of
the Civil Code.
The list of such tooling appears in Annex 9.
<PAGE> 199
SAGEM shall take out the necessary insurance to cover all risks related to the
holding and usage of this tooling.
The Parties agree that if SAGEM develops, at SGI's cost any tooling specifically
for the production of the SciScan terminals, this equipment shall be the
property of SGI and shall be included in the list of tooling appearing in Annex
9.
In the event that the Agreement is terminated for whatever reason, SAGEM shall
return to SGI all tools loaned to SAGEM as well as all tools developed at SGI's
cost.
The specific tooling, property of SAGEM, shall be inventoried annually and shall
be the object of a quotation. In the event that the present Agreement is
terminated, SAGEM shall grant to SGI, at the price of the aforementioned
quotation, the tooling which it might need to be able to resume production of
the SciScan Terminals.
24. SVGS. RESUMPTION OF THE MANUFACTURING PROCESS
SAGEM shall guarantee the complete reversibility of the production process of
the Sci Scan Terminals in order to allow SGI to resume, under optimal
conditions, the production of the SciScan Terminals granted according to the
terms of the present Agreement.
SAGEM shall not modify in a substantial manner its production process without
informing SGI beforehand.
In order to allow the resumption of the production of the SciScan Terminals by
SGI or by third Parties in accordance with the terms of this Agreement, the
Parties hereby agree that:
Each year, during the first calendar month SAGEM shall forward to SGI the list
of all the suppliers of the components or spare parts making up the SciScan
Terminals. When that is possible, SAGEM shall have to attach to this document
the list of suppliers that may be employed as substitutes for those presently
used in addition to the list of components or substitute spare parts indicating
the suppliers.
Upon the date of expiry or termination of the present contract, SAGEM shall make
available to SGI the means, as employed by SAGEM at that time, allowing the
resumption by third Parties or by SGI of the activities of the production of the
SciScan Terminals.
These means designate notably development files, plans and Manufacturing records
relative to the SciScan Terminals. Training sessions may also be implemented.
SAGEM shall communicate, after a final update, the list of suppliers of the
components or spare parts provided for in the present Agreement.
The specific equipment shall be made available under the conditions indicated in
Section 23.
<PAGE> 200
The means of implementation and the financial conditions intended to guarantee
this revertibility when exercised, shall be defined by mutual agreement between
the Parties.
SAGEM's commitments under the present Section are limited to the means and
actions strictly necessary to guarantee the resumption of the production of the
SciScan Terminals.
SAGEM shall have the right to condition, in a reasonable manner, the grant of
the right of use of the industrial or intellectual property rights of which it
holds title, upon conclusion of the specific agreements intended to protect its
rights, which shall not impede the revertibility of the production process.
25. TERMINATION
In the event of breach by one of the Parties of this Agreement, the
non-defaulting Party may terminate this Agreement, without prejudice to any
other rights it may have, with thirty (30) days notice, issued and sent by
certified mail with return receipt requested to the breaching Party and where,
at the end of such period, the breach remains unremedied.
Orders having been submitted prior to the effective date of termination of this
Agreement shall remain unaffected thereby.
26. ASSIGNMENT
Neither Party shall assign any of its rights or obligations either in whole or
in part whatsoever with respect to the Agreement, without having previously
obtained the written consent of the other Party, which consent shall not be
unreasonably withheld.
In particular, such assignment cannot be rightfully refused if it arises from a
purely internal restructuring and if the assignee company makes the same
undertakings and warranties with respect to solvency, durability and competence
as the assignor, and to the extent only that performance of this Agreement is
not altered thereby.
For the purposes of this Section, any change in the majority-ownership of share
capital of a Party, any capital contribution, merger, absorption, and,
generally, any corporate transaction aimed at or resulting in a change in the
corporate ownership of a Party shall be deemed to constitute an assignment.
27. SUBCONTRACTING
SAGEM may use subcontractors for the performance of its obligations hereunder.
<PAGE> 201
SAGEM warrants that with respect to its subcontractors, it has obtained all such
necessary contractual undertakings so as to enable it to perform its obligations
under this Agreement.
SAGEM shall be directly liable for all of the acts and omissions of
subcontractors, even where the same have been selected with the approval of SGI.
SAGEM shall ensure that all of the obligations of subcontractors shall be fully
performed. Subcontracting hereunder shall be subject to the Law of December 31,
1975.
28. CONFIDENTIALITY
Throughout the term of this Agreement, the Parties may come into possession of
confidential technical, commercial or financial information.
Each of the Parties hereby undertakes that it shall, and shall procure that its
employees and all Parties acting under them shall preserve the absolute
confidentiality of all technical data, information or advice that may come into
its possession in either the negotiation, signature and performance phases of
this Agreement.
Information, concepts or techniques shall not, however, be deemed to be
confidential if-
they are, at the time of their disclosure, either in the public domain
or have fallen into the public domain in the absence of any breach of
the terms of this Agreement;
they are known to one or the other of the Parties without any breach of
the obligation of confidentiality hereunder; or
they have been received in a lawful manner by one or other of the Parties from a
third Party without any obligation of confidentiality. The Parties hereto agree
that the terms of this Agreement are confidential.
In the event that one of the Parties is obliged by law to disclose confidential
information, this Party shall inform the other Party in the shortest possible
time. In such a case, the Party obliged to disclose the information shall only
disclose the minimum information required by law, and, when feasible, shall
obtain protective measures or ensure the confidentiality of disclosed
information.
The obligation of confidentiality under this Section shall remain in effect for
a period of five (5) years following the end of this Agreement for whatever
cause.
<PAGE> 202
29. ADMINISTRATIVE STEPS
SAGEM shall proceed with the filings, declarations, and applications for
authorizations required by applicable laws in relation to performance of this
Agreement.
30. LANGUAGE
The Parties agree that the language used for the purposes of the execution of
this Agreement shall be English. Accordingly, correspondence exchanged and
meetings conducted between the Parties shall be in the English language.
31. ENTIRE AGREEMENT
The provisions of this Agreement and its Annexes express the entirety of the
agreement concluded herein between the Parties hereto concerning the
subject-matter hereof and accordingly shall prevail over any statement, exchange
of correspondence occurring prior to the signature hereof, and over any other
provision set forth in documents exchanged between the Parties and relating to
the subject-matter hereof.
32. NO WAIVER
If, on one or more occasions, one of the Parties does not require the observance
of one or more of the provisions of this Agreement, this shall not in any event
be deemed to constitute any waiver by that Party of its rights under such
provision or any other provision of the Agreement in identical or any other
circumstances.
33. AMENDMENT
The provisions of the body of this Agreement together with the deadlines and
financial terms hereof may not be amended except by means of a written amendment
signed by the duly authorized representatives of both Parties and executed at a
date following the effective date of this Agreement. Other provisions, and in
particular, technical Annexes, may be amended resulting from the reports of
progress meetings, as soon as they have been signed by the appointed operational
representatives of the Parties indicated in Annex 7.
The pre-printed general terms and conditions of purchase or sale set forth on
purchase orders, receipts invoices shall be without effect.
<PAGE> 203
34. PUBLICITY
The Parties agree that the terms of this Agreement are confidential and that
SAGEM shall not cite the Agreement as a commercial reference without having
obtained the prior written consent of SGI.
However, the Parties agree that they may mention the Agreement in order to
comply with the applicable legal requirements.
35. INTERPRETATION
In the event of contradiction between the terms contained in the body of this
Agreement and those of its Annexes, the provisions contained in the body of this
Agreement shall prevail over those of its Annexes.
36. INDEPENDENCE OF THE PARTIES
Neither this Agreement, nor any provisions hereof, shall be deemed to create any
partnership (Societe en participation), agency or franchise between the Parties
or create a relationship of employer-employee between one of the Parties and the
employees of the other Party.
37. HEADINGS
The headings of Sections in this Agreement are solely employed for ease of
reference and shall not prevail over or be deemed to modify or amend any of the
same.
38. GOVERNING LAW AND DISPUTES
38.1 Governing Law
This Agreement is governed by and shall be interpreted in accordance with the
laws of France.
38.2 Arbitration
Any dispute arising between the Parties relating to the interpretation or
performance of a provision of this Agreement or its Annexes shall be settled by
one or more arbitrators according to the Rules of Arbitration of the
International Chamber of Commerce.
<PAGE> 204
The Parties agree that the language of arbitration shall be English and that the
place for arbitration shall be Paris.
38.3 Choice of Domicile and Jurisdiction
The Parties hereby elect domicile at their respective registered offices. Any
notice required to be served hereunder as a result of non-performance of any of
the terms of this Agreement shall be addressed to the respective registered
offices of the Parties.
38.4 Notice
Any notice or other communication under this Agreement shall be deemed given if
delivered in writing to the intended recipient either in person, or by mail,
certified or registered, postage prepaid, or by recognized overnight delivery
service, or by telecopier to the intended recipient at the address and
telecopier number specified herein:
<TABLE>
<S> <C>
If to SAGEM: If to SAGEM:
Scientific Games International SAGEM S.A.
Attention: Mr. William J. Malloy Attention:
President and CEO Mr. Pierre Faurre or Mr. Guy Rouanne
1500 Bluegrass Parkway 6, avenue d'Iena
Alpharetta, Georgia 30004 75016 Paris
USA FRANCE
With a copy to Gray Bethea, Jr. With a copy to : Georges de Mont Serrat
Vice President and General Counsel Fax No. 0140 70 87 33
Fax No. 1770 343 8798
</TABLE>
or such other address or telecopier number as a Party may specify from time to
time pursuant to this Section.
Notice sent in the manner described above shall be deemed effectively given as
of the date of receipt.
<PAGE> 205
39. CONDITION PRECEDENT
SAGEM acknowledges that the SciScan Terminals are to be manufactured for re-sale
by SGI to La Francaise des Jeux ("FDJ"). This Agreement shall only enter into
effect upon the signing of the SciScan Purchase Agreement between SGI and FDJ,
and neither of the parties to this Agreement shall incur any obligations or
liability until the signing of such Agreement between SGI and FDJ upon notice
thereof to SAGEM. The deadlines for the delivery schedule shall start from the
effective date of the Agreement. If no agreement is entered into between SGI and
FDJ one month after the signing of this Agreement, this Agreement shall be null
and void.
Made in Neuilly-sur-Seine,
This 29th day of September 1998,
In two originals
For and on behalf of For and on behalf of
SAGEM SAGEM
Mr. Pierre Faurre Mr. William G. Malloy
Mr. Guy Rouanne
<PAGE> 206
VERSION NUMBER 2 PROJET CONFIDENTIEL
ANNEXE 1: SPECIFICATIONS DES TERMINAUX SCISCAN
Les Ten-ninaux SciScan, y compris ceux de la Commande Initiale, auront les
caracteristiques decrites dans le document:
SCISCAN TERMINAL SPECIFICATIONS FOR FORTUNA PROJECT Ref. SCP U31 IJ100 PR 276
ind A du 22/09/98
<PAGE> 207
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<S> <C> <C> <C>
SAGEM Ref. : SCP U31 IJ100 PR 276 A
SAGEM sA TERMINALS Version : Variante :
Etablissement de Cergy Saint-Christophe SCISCAN Autre ref :
URD31 Date: 22/09/98 Folio: 1 / IS
</TABLE>
SCISCAN TERMINAL SPECIFICATIONS FOR FORTUNA PROJECT
PRELIMINARY
TYPE
DE DIFFUSION
Libre 1
DIFFUSION Restreinte
Confidentielle
<TABLE>
<CAPTION>
Societe Diffusion Originaux Copies
<S> <C> <C> <C>
SCT SIEGE G DE MONT-SERRAT 1
SCT DU JY VALET 1
SCT URD 31 JF LAILLEMANT
SCT URD 31 X CHAUSSADE
SCT URD 31 Archivage Projet 1,1100
LFDJ R THEYS 1
SGI W. BEHM
</TABLE>
<TABLE>
<CAPTION>
AUTEUR VALIDE PAR VALIDE PAR
<S> <C> <C>
Nom: X.CHAUSSADE Nom: J.F. LAILLEMANT Nom: J.Y VALET
Date: 22/09//98 Date 22/09198 Date: 22/09/98
Visa: Visa Visa:
</TABLE>
<PAGE> 208
<TABLE>
<S> <C>
SAGEM SA - Etablissement de Cergy Saint-Christophe Ref: SCP U31 IJ 100 PR 276 A
PRELIMINARY Date : 23/09/98
</TABLE>
This document is property of group SAGEM. No part of it may be reproduced
without SAGEM's permission.
SHEET RELEASE
<TABLE>
<CAPTION>
release date author modification description
<S> <C> <C> <C>
30/07/98 KCHAUSSADE create
03/09/98 JF LALLEMANT released
2 16/09/98 W.BEHM add serial interface to SCPFAX
(SGI) delete CCD reader
add memory sockets
add bar code reader
A 22/09/98 KCHAUSSADE add ECP interface
add SYNC X25 interface
add 24V
</TABLE>
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<TABLE>
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SAGEM SA - Etablissement de Cergy Saint-Christophe Ref: SCP U31 IJ 100 PR 276 A
PRELIMINARY Date : 23109/98
</TABLE>
CONTENTS
<TABLE>
<S> <C> <C>
1. - SUBJECT ..................................................................................4
1.1. - INTRODUCTION ...........................................................................4
1.2. - REFERENCES .............................................................................4
2. GENERAL DESCRIPTION ........................................................................5
2.1. PRESENTATION .............................................................................5
2.2. FEATURES .................................................................................5
2.3. GENERAL ARCHITECTURE .....................................................................7
3. HARDWARE DESCRIPTION .......................................................................8
3.1. USER INTERFACE MODULE ....................................................................8
3.1.1. LCD PANEL ..............................................................................8
3.1.2. KEYBOARD ...............................................................................8
3.1.3. CONTROL PANEL BOARD ....................................................................9
3.2. PROCESSOR BOARDS ........................................................................10
3.2.1. ARCHITECTURE ..........................................................................10
3.2.2. MCPII1 BOARD ..........................................................................11
3.2.3. SCPFAX BOARD ..........................................................................13
3.2.4. MCPIII / SCPFAX INTERFACES ............................................................15
3.3. BARCODE READER ..........................................................................15
3.4. NARROW THERMAL PRINTER: STANDARD ........................................................16
3.5. WIDE THERMAL PRINTER: OPTIONAL ..........................................................16
3.6. LATEX READER ............................................................................17
3.7. CUSTOMER DISPLAY (OPTIONAL) .............................................................17
3.8. POWER SUPPLY ............................................................................17
4. SOFTWARE DESCRIPTION ......................................................................18
4.1. MAIN PROCESSOR ( ELAN SC41 0 ): .........................................................18
4.1.1. OPERATING SYSTEM: .....................................................................18
4.1.2. PROGRAM APPLICATION ...................................................................18
4.2. PFAX PROCESSOR: .........................................................................18
4.2.1. OPERATING SYSTEM: .....................................................................18
4.2.2. PROGRAM APPLICATION ...................................................................18
</TABLE>
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PRELIMINARY Date : 23/09/98
</TABLE>
1. -SUBJECT
1.1. -INTRODUCTION
This document is the description of the SCISCAN terminal hardware
specifications, that SAGEM is proposing to SCIENTIFIC GAMES for the FORTUNA
project.
1.2. - REFERENCES
SCISCAN DOCUMENTATION: SGI
PFAX30 DATA SHEET: SCP U31 PFAX- SE 66
ALIX DATA SHEET: SCP U31 ALIX- SG 002
LCD 4X20 DATA SHEET SCP U31 - 23 282 476-1
ELAN SC 410 DATA SHEET: AMD
THOMSON MODEM ((VENUS-DATA)) DATA SHEET
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<TABLE>
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PRELIMINARY Date : 23/09/98
</TABLE>
2. GENERAL DESCRIPTION
2.1. PRESENTATION
The SCISCAN terminal is a compact Latex and Bar Code reader for Lottery game
application. A thermal printer integrated in the terminal can print receipts
required by the application. The terminal can be connected with a modem or a X25
connection for "on line" transaction.
2.2. FEATURES
<TABLE>
<S> <C>
0 Mechanical dimension W X H X D: 170 X 155 X 330 mm
PROCESSOR UNITS:
E Main Processor Board AMD ELAN 486DX-66MHz
+ Motorola 68HC16
DRAM: 4 (opt 8) MBytes
FLASH: 2 (opt 4) MBytes
S RAM (battery saved 512 KBytes (opt 1 Mbyte)
Latex reader interface
Bar code reader interface
Serial ASYNC interfaces: COM1 to COM4 RS232/RS485
Serial ASYNC. interface to SCPFAX TTL : up to 115200 bauds
Parallel ECP interface to SCPFAX
0 SCISCAN PFAX Processor Board: SAGEM PFAX 30MHz
FLASH: 512 Kbytes (opt. 1 MB)
SRAM: 128 Kbytes (opt. 256KB)
LCD & Keyboard modules interface: TTL serial SYNC 4800bauds
Printer interface: unique
Modem interface: see modem section hereafter
Serial ASYNC X25 interface (Standard): RS232 - up to 19200 bauds
Serial SYNC. X25 interface (Option): RS232 - up to 19200 bauds
RTC line interface:
Serial ASYNC. interface to ELAN 486 TTL : 300 to 11 5,2KB JBC)
Parallel ECP interface to MCP:
USER INTERFACE MODULES:
- - LCD Display: display area 42 X 76 mm
4 lines of 20 characters
1 line of 7 symbols at top
1 line of 20 symbols at bottom
- - Keyboard: 22 keys with Navigator
</TABLE>
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<TABLE>
<S> <C>
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PRELIMINARY Date: 23/09/98
N Smart card reader (option) I external ISO size integrated in SCISCAN cover
</TABLE>
OTHER MODULES:
- Bar Code LASER or CCD reader
- Thermal Printer: narrow (standard) wide (optional)
- Latex reader
- External Power Supply
- Small Player Display (option)
to-
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<TABLE>
<S> <C>
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PRELIMINARY Date: 23/09/98
</TABLE>
2.3. GENERAL ARCHITECTURE
<TABLE>
<S> <C> <C>
Control panel board
Smart Card
Keyboard
LCD Display Reader
22 keys
MAIN BOARD POWER
MCP III SUPPLY
100-250V 47-63 Hz
Paper detect sensor
Front cover open sensor
PFAX Bar Code Reader
Thermal BOARD
Printer
Modem-X25
interface LATEX Sensor
</TABLE>
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PRELIMINARY Date: 23/09/98
</TABLE>
3. HARDWARE DESCRIPTION.
3.1. USER INTERFACE MODULE
The user interface module contains:
0 LCD panel
IN flex matrix for the keyboard
IN control panel board
0 1 to 3 leds
3.1.1.LCD PANEL
0 20 characters by 4 lines
E . I line with 7 specific symbols
E::] [:1 E::] EJ F-1 EJ 0 7 Sagem fax specific signs
Line 1
Line 2
Line 3
Line 4 20 arrows signs
- - Each character is a 5 X 8 dot matrix.
- - No contrast function
3.1.2. KEYBOARD
The keyboard contains 22 keys:
- a numeric pad: 0123456789*#
- a function pad: 3 keys
- a navigator pad: Cancel Menu OK <-- ft
The structure of the keyboard is:
Keys
Rubber key pad
I *---Flex board or PCB
The rubber do the contact between a line and a row on the flex board matrix or
PCB.
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PRELIMINARY Date : 23/09/98
</TABLE>
3.1.3. CONTROL PANEL BOARD
The architecture is:
SYNC. Serial Driver
link to PFAX extension
board (4,8Kbds) MPU Controller
LCD Driver
Led
Rows Lines
Keyboard
- - IVIPU Controller:
CPU: 4 bit - 4,19 MHz
RAM: 512 X 4
ROM: 8kX8
1/0 : 36 pins
8 bits serial interface ( used as synchronous interface
Two 8 bit timer/counter
The chip is programmed to: control a 8 X 8 keyboard matrix send commands or
characters to the LCD drivers use one timer for the buzzer melody.
- - LCD Driver: interfaced with the 4 bit MPU controller 34 common X 60 segment
driver
generator of 5 X 8 dot matrix characters in ROM 240 characters ( 5 X 8
dots can be customised in RAM 8 characters ( 5 X 8 dots
- - LCD Driver Extension:
This chip is a 40 channels segment/common driver for LCD. It is
directly connected to the LCD driver by the extension serial bus
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PRELIMINARY Date: 23/09/98
</TABLE>
3.2. PROCESSOR BOARDS
3.2. 1. ARCHITECTURE
GRAPHIC
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<S> <C>
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PRELIMINARY Date : 23/09/98
To Thermal printer To LATEX sensor
</TABLE>
3.2.2.MCP111 BOARD
The MCPIII board is directly designed from MCPII board of the SCISCAN 2000
Terminal. The MCP controls the Latex module and runs the FORTUNA application and
interfaces with the BarCode reader. The differences of MCPIII compared to MCPIl
are for the SCPFAX board interfaces and power supply requirements.
3.2.2.1. Main Processor
The main processor is AMD ELAN SC 410. The main characteristics are:
- compatible with Intel 486
- clock frequency 66 MHz
- 8k Byte cache
- timer 8254
- 2 DMA controllers
- 1 serial interface
- 1 Bidirectionnal Centronics EPP interface
The operating voltage is 3,3 V and 5V.
3.2.2.2. Latex Processor
The auxiliary processor for Latex control is Motorola 68HC16 processor.
3.2.2.3. Main Memory
The board has Four Mbyte DRAM and sockets to expand to 8 Mbyte DRAM total. The
chips are directly controlled by the SC410 on the DRAM bus.
3.2.2.4. Flash Memory
The board has Two Mbyte AMD 29LVO17 Flash and one socket for 2 Mbyte additional
flash. The chips are directly controlled by the SC410 on the ISA bus.
3.2.2.5. SRAM Memory
The board has 512 KByte SRAM, connected on the ISA Bus and one socket for 512
kByte additional SRAM. The SRAM is saved by a 3,6V battery.
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<PAGE> 218
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<S> <C>
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PRELIMINARY Date : 23/09/98
</TABLE>
3.2.2.6.Serial port
The board has x1 PC16552 chip and x1 <( 2 Serial ASYNC + ECP )) chip (for
instance NS97C307 or NS87309) connected on the ISA Bus. These chips are a dual
asynchronous receiver/transmitter with FIFO. Features: - 5,6,7 or 8 bit
characters - even, odd or no parity bit generation - baud generator up to 115.2
KBaud
The reference clock is generated by an external 1,8432MHz oscillator.
All the signals are on the rear 2 x RJ45 connectors. Physical interface Gan be
mixed V28/RS485 - To Be Precised
3.2.2.7. ISA Interface
This interface allows to transfer in 1/0 mode between the Main processor and the
68HC16 processor.
3.2.2.8. Latex reader interface
This interface is controlled directly by the auxiliary processor and the
following interfaces
- the analog multiplexer
- the amplifiers
- the voltage to frequency converter
- Motor interface: it is realized with a stepper motor driver, that
controls the current level in the bipolar motor.
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PRELIMINARY Date: 23/09/98
</TABLE>
3.2.3.SCPFAX BOARD
The SCPFAX (SCISCAN PFAX) board is developed for the FORTUNA product. This board
is designed from SAGEM's FAX products. PFAX board controls the following
modules: LCD+Keyboard, Printer (small or large one), Communication Modem and
X25, and Smart card reader.
3.2.3.1. PFAX Processor
The PFAX includes several functions:
N 8086 core processor at 30 MHz
N IT controller
0 2 Timers ( 8 bits)
E 4 serial links (2 SYNChronous and 2 ASYNCchronous
0 Video controller for CCD
0 Thermal head controller
0 Encoder - Decoder RL
0 Bidirectionnal Centronics ECP bus.
GRAPHIC
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PRELIMINARY Date : 23/09/98
</TABLE>
3.2.3.2. PFAX memories
The scanner processor needs two memories: Flash and SRAM. PFAX
The flash memory is 512 KByte sized minimum (To Be Precised). It contains the
program code for this processor. The program code of PFAX can be loaded from the
Phone Line directly in flash memory.
The SRAM memory is 128 (opt 256) KByte sized. It contains parameters for this
processor when printing and communicating.
3.2.3.3.Smart card reader interface
There is One Smart Card Reader Interface as an Option:
E a Card Reader accessible from the external of the terminal.
The electronic interface is made by a dedicated circuit (TDA 8006). It's
connected to the PFAX processor by an asynchronous serial link. It generates all
the ISO 7816 Smart Card protocol.
3.2.3.4. Printer interface
The PFAX processor has a thermal head controller.
It generates the validation signal for the head drivers (strobes) and the
transfer command for internal serial shift register (Latch). The bitmap is
sent by the CPU or by the RL decoder. A DMA transfer from the memory to the RL
decoder is possible.
3.2.3.5. Communication interface
The communication interface of SCPFAX board with the external of the SCISCAN
Terminal is of two types : 0 Modem Thomson VLsnus - Data and Phone line
interface. N Serial X25: RS232 ASYNC or SYNC (option)
The PFAX processor runs different communication protocols over these two
interfaces.
N Modem THOMSON VENUS DATA main features:
- Full duplex data
ITU-T V32 bis, V32 ( 14400,1200,9600,7200, 4800 bps
ITU-T V22 bis, V22 ( 2400, 1200 bps )
HDLC support
-10 to -25 dBrn programmable transmit power
-10 to -45 dBm receiver dynamic range
- Single chip fax
ITU-T V 17, V29 & V27 ter (short train), V21
- Digital answering machine
N Phone Line interface electronic:
L'utilisation et/ou la divulgation de ces
informations sont soumises aux restrictions enoncees sur
la page "Utre" ou "historique des evolutions" du document.
<PAGE> 221
<TABLE>
<S> <C>
SAGEM SA - Etablissement de Cergy Saint-Christophe Ref : SCP U31 IJ 100 PR 276 A
PRELIMINARY Date : 23/09/98
</TABLE>
- Transformer
- Line protection
- Current adaptation for different countries
E X25 interface:
- Standard is ASYNChronous RS232 interface. X25 ASYNC protocol
is run directly by PFAX processor: rate up to 19200 bauds
- In Option, a serial communication controller (85C30 or
equivalent), on board, is used for SYNChronous X25 protocol:
rate up to 19200 bauds
3.2.4.MCPIII / SCPFAX INTERFACES
There are two interfaces between the MCPIII and the SCPFAX:
- a TTL parallel ECP interface:
It's realized with a NSC97307 super 1/0 (or equivalent NS87C309). The
super 1/0 include two fast UARTs and an IEE 1284 parallel port (ECP). It
replaces one PC16552 of IVICPII.
a TTIL serial ASYNChronous interface:
ELAN serial UART:
PFAX serial UART : 300 to 115200 bauds (To Be Confirmed)
3.3. BARCODE READER
Graphic
L'utilisation et/ou la divulgation de ces
informations sont soumises aux restrictions enoncees sur
la page "titre" ou "historique des evolutions" du document.
<PAGE> 222
<TABLE>
<S> <C>
SAGEM SA - Etablissement de Cergy Saint-Christophe Ref: SCP U31 IJ 100 PR 276 A
PRELIMINARY Date: 23/09/98
</TABLE>
3.4. NARROW THERMAL PRINTER: STANDARD
- - Technology: Fixed Thermal Head
- - Paper Type Direct Thermal (60 or 80g)
- - Paper Width 60mm max
- - Print Width 48mm : 384 dots head
- - Print Speed up to 30mm/sec
- - Dimensions: W-78 mm; D-53 mm; H-20 mm
- - Weight: To Be Precised
- - Cutter: Manual cut with plastic tear shape of cover edge
- - Horizontal Resolution: 8 lines/mm (203dpi)
- - Vertical Resolution: 8 lines/mm (203dpi)
- - Sensors Paper out sensor (opto reflective)
- - Power: 5V
- - Reliability: 50 Km paper; 50 million head pulses
- - Paper Roll Diameter: around 55 mm
- - Others: Automatic paper loading system
3.5. WIDE THERMAL PRINTER: OPTIONAL
- - Technology: Fixed Thermal Head
- - Paper Type: Direct Thermal (60 or 80g)
- - Paper Width 82,55mm
- - Print Width 72mm (with 576 dots head)
or 80mm (with 640 dots head)
- - Print Speed up to 50mm/sec
- - Dimensions: W-95mm; D-45mm; H-20mm
- - Weight: Approximately 100g.
- - Cutter: Manual cut with metal tear bar
-16-
L'utilisation et/ou la divulgation de ces
informations sont soumises aux restrictions enoncees sur
la page "titre" ou "historique des evolutions" du document.
<PAGE> 223
<TABLE>
<S> <C>
SAGEM SA - Etablissement de Cergy Saint-Christophe Ref: SCP U31 IJ100 PR 276 A
PRELIMINARY Date : 23/09/98
</TABLE>
- - Horizontal Resolution: 8 lines/mm (203dpi)
- - Vertical Resolution: 8 lines/mm (203dpi)
- - Sensor Paper out sensor (opto reflective)
- - Power: 5V and 24V (for Head)
- - Reliability: 50 Km paper; 100 million head pulses
- - Paper Roll Diameter: Around 55 mm
- - Others Easy paper loading system
3.6. LATEX READER
To Be Precised
3.7. CUSTOMER DISPLAY (OPTIONAL)
To Be Precised
3.8. POWER SUPPLY
The power supply is external. Due to the requirement of 24V for wide printer
only, it has to be considered if it will exists one of more models of this
module.
The characteristics are:
- Input voltage: 100V - 250V
- Input frequency: 47-63 Hz
- Power max: 50 W
- Output voltage: 24V - current To Be Precised (For Wide Printer)
12V - current To Be Precised
-17-
L'utilisation et/ou la divulgation de ces
informations sont soumises aux restrictions enoncees sur
la page "titre" ou "historique des evolutions" du document.
<PAGE> 224
<TABLE>
<S> <C>
SAGEM SA - Etablissement de Cergy Saint-Christophe Ref: SCP U31 IJ 100 PR 276 A
PRELIMINARY Date: 23/09/98
</TABLE>
4. SOFTWARE DESCRIPTION
4.1. MAIN PROCESSOR (ELAN SC410):
4.1.1.OPERATING SYSTEM:
0 QNX / NUTRINO It is developed by SGI.
4.1.2. PROGRAM APPLICATION
All software of MCPIII board is developed by SGI.
4.2. PFAX PROCESSOR:
4.2.1.OPERATING SYSTEM
0 NUCLEUS. It is developed by SAGEM.
4.2.2. PROGRAM APPLICATION
- - The following drivers are developed by SAGEM on PFAX processor:
- MCP parallel interface driver: To Be Defined
- MCP serial link interface driver: To Be Defined
- Thermal printer drivers
- Smart Card reader driver
- Modem VENUS DATA drivers
- LCD+Keyboard driver
- - Protocols supported by SAGEM on PFAX processor
- X25 ASYNC. or SYNC. on RS232 (up to 19200 bauds)
- X25 on Phone Line = X32
- PPP / IP on Phone line
- HDLC: depending of the protocol above - ok with X25 -
L'utilisation et/ou la divulgation de ces
informations sont soumises aux restrictions enoncees sur
la page "titre" ou "historique des evolutions" du document.
<PAGE> 225
VERSION N(degree)2 PROJET CONFIDENTIEL
ANNEXE Ibis: DEVELOPMENT ORGANIZATION
<TABLE>
<CAPTION>
TASKS SAGEM SGI
<S> <C> <C>
MECHANICS:
- -Upper cabinet parts for new LCD, Keyboard, Printer: CAO design & X
mold fab.
ELECTRONICS:
- -Main Board (redesign for PFAX interface): X
Schematics - CAO - prototype fab. - Debug & Qualif
- -PFAX board: Schematics - CAO - prototype fab. - Debug & Qualif X
- -Keypad board: Schematics - CAO - prototype fab. - Debug & Qualif X
SOFTWARE:
Operating System for ELAN: X
ELAN4-* PFAX interface drivers (data exchange - PFAX code X
_loading at boot) : ELAN side
- -ELAN 4* PFAX interface drivers: PFAX side X
- -Drivers Bar-code reader, Latex reader X
- -Applications: ELAN Side X
- -Applications user's interface drivers (LCD, Keyboard): PFAX side X
- -New Large Printer driver: PFAX side X
- -New Asynchronous X25 driver on uart (for external modem): PFAX X
side
New Synchronous X2 5 driver on RTC line (via internal modem): X
PFAX side
- -New Synchronous X25 driver on UART X
- -New Customer Display driver: PFAX side X
- -New Customer Display user's interface application: ELAN side X
- -Existing PFAX drivers (Small Printer, LCD, Keyboard, Smart Card, X
Modem): "Portage" to SCISCAN software base
PROTOTYPES:
- -Hardware/Software integration X support
- -Prototypes fab., Debug & Qualif X
- -Safety and Telecom. Agreement compliance tasks X
</TABLE>
Contrat SAGEM de fabrication de Terminaux SciScan 29/09/98 2/16
<PAGE> 226
VERSION N(degree)2 PROJET CONFIDENTIEL
DEVELOPMENT KEY EVENTS AND DATES FOR LASER BAR CODE READER AND SMALL PRINTER
VERSION
<TABLE>
<CAPTION>
EVENT DATE
<S> <C>
- -SAGEM<*SGI TO
- -SAGEM: start of development of PFAX board and design of upper cabinet TO
- -SGI: start of development of new MCPIII board TO
- -SAGEM,:* SGI: agreement on Terminal detailed specifications (and TO + 0.5 month
particularly about hardware and software interfaces between MCPIII and
SCPFAX boards)
- -SAGEM: delivery of 3 PFAX development boards TO+ I m
- -SGI: delivery of 3 MCPIII development boards TO+ I in
- -SGI: delivery of the sciscan tools TO+ I m
- -SAGEM: delivery of 2 soft tooled upper cabinet TO + 2 in
- -SGI: delivery of 3 MCP III prototypes (with communication software with TO + 2.5 m
SCPFAX, and with definition files)
- -SAGEM & SGI : start of Hardware/Software integration TO + 3
- -SAGEM: Delivery to SGI of 5 prototypes TO + 5 m
- -SAGEM end of Hardware functions validation TO+5m
- -SAGEM: delivery of 100 pre-production terminals TO +7 m
- -SAGEM Safety and Telecom. Agreement (France, Indiana, Israel) TO + 7m
</TABLE>
On the whole, for mass-production, components deliveries from SGI should be
realized
- 3 months (hardware components)
- or I month (software components) before terminals deliveries from
SAGEM.
DEVELOPMENT KEY EVENTS AND DATES FOR CCD BAR CODE READER AND
WIDE PRINTER VERSION
It needs one more month
<PAGE> 227
VERSION N(degree)2 PROJET CONFIDENTIEL
ANNEXE 2: COMMANDE INITIALE
1. Quantite de Terminaux SciScan commandes
La Commande Initiale est de 15 000 Terminaux SciScan.
2. Planning de livraison des Terminaux SciScan
TO etant la date d'acception de la commande par SAGEM
Etapes:
<TABLE>
<S> <C>
3 cartes de developpement PFAX avec interface ECP TO + 1 mois
pour permettre a SGI de valider le protocole PFAX
d'echange entre la carte ELAN et la carte PFAX
5 prototypes TO + 5 mois'
- lot de 100 terminaux (pre-production) TO + 6 mois
- Jot de 250 terminaux TO + 8,5 mois
- lot de 750 terminaux TO + 10 mois
- les quantites des lots suivants pourront etre ajustes d'un commun accord en
fonction des besoin du Client final (entre 1000 et 25 00 terminaux par
mois, aout exclus)
</TABLE>
3. Prix des Terminaux SciScan pour la Commande Initiale
Le prix du Terminal SciScan est defini a l'annexe 3.
4. Modalites de paiement
Les factures seront regles conformement a l'article 5.2 du present contrat
La domiciliation du paiement sera indique les factures
<PAGE> 228
VERSION N(degree)2 PROJET CONFIDENTIEL
ANNEXE 3: PRIX H.T. DES TERMINAUX SCISCAN
1. Prix EXW des Terminaux SciScan pendant le cycle de production.
1. 1. Terminaux de la commande initiale 15 000 (unites)
- - Terminal avec modem 14,4 Kb/s, sans lecteur de code barre et sans
decodeur associe (ces modules etant fournis par SGI)
Prix unitaire FrF HT 3354
- - Terminal avec modem 14,4 Kb/s, avec lecteur de code barre CCD SAGEM et
decodeur associe
Prix unitaire FrF HT 3588
- - Options:
<TABLE>
<S> <C> <C>
lecteur de carte a puce Prix unitaire FrF HT 114
petit ecran joueur Prix unitaire FrF HT 192
port X25 synchrone Prix unitaire FrF HT 46
</TABLE>
1.2. Terminaux apres la commande initiale avec CCD SAGEM
<TABLE>
<S> <C> <C> <C>
Quantites 1000 5000 10000
a a et
4999 9999 plus
</TABLE>
<TABLE>
<S> <C> <C> <C> <C> <C>
SciScan 1000-3* avec modem 14,4 Kb/s Prix unitaire FrF HT 3396 3204 3138
SciScan 2000-3 avec modem 14,4 Kb/s Prix unitaire FrF HT 3882 3666 3588
SciScan 3000-3 avec modem 14,4 Kb/s Prix unitaire FrF HT 4530 4296 4188
et imprimante large
Options: lecteur de carte a puce Prix unitaire FrF HT 126 120 114
petit ecran joueur Prix unitaire FrF HT 204 198 192
port X25 synchrone Prix unitaire FrF HT 49 47 46
</TABLE>
* Le SciScan 1000-3 n'a ni imprimante ni LCD, ni clavier.
2. Prix EXW des Terminaux SciScan hors cycle de production.
En cas d'arret de production par manque de commande, le prix des 500 premiers
terminaux commandes sera majore de 4%
Le prix figurant ci-dessus en periode de production est applicable a la Commande
Initiale.
<PAGE> 229
VERSION N(degree)2 PROJET CONFIDENTIEL
ANNEXE 4: TARIF H.T. DES PIECES DE RECHANGE ET
DES PRESTATIONS DE SERVICE APRES VENTE
1) Pendant les periodes de fabrication en serie des appareils de ce type
<TABLE>
<CAPTION>
Prix du module Prix de l'echange standard
FrEHT FrF.HT
<S> <C> <C>
- - carte ELAN 2000 800
- - carte PFAX sans X 25 synchrone 750 300
- - carte PFAX avec X 25 synchrone 813 325
- - module lecteur laser fourni par SGI fourni par SGI
- - module lecteur CCD SAGEM 338 135
- - module detection latex 150 non reparable
- - imprimante 300 non reparable
- - ecran LCD du terminal 200 non reparable
- - alimentation 250 non reparable
- - capot superieur equipe du clavier 150 non reparable
- - lecteur de carte a puce 150 non reparable
- - ecran LCD joueur 267 non reparable
</TABLE>
2) Apres les periodes de fabrication en serie des appareils de ce type
<TABLE>
<CAPTION>
Prix du module Prix de l'echange standard
FrEHT FrEHT
<S> <C> <C>
- - carte ELAN 2900 1160
- - carte PFAX sans X 25 synchrone 1088 435
- - carte PFAX avec X 25 synchrone 1178 471
- - module lecteur laser fourni par SGI fourni par SGI
- - module lecteur CCD SAGEM 489 196
- - module detection latex 218 non reparable
- - imprimante 435 non reparable
- - ecran LCD du terminal 290 non reparable
- - alimentation 363 non reparable
- - capot superieur equipe du clavier 218 non reparable
- - lecteur de carte a puce 218 non reparable
- - ecran LCD joueur 387 non reparable
</TABLE>
<PAGE> 230
VERSION N(degree)2 PROJET CONFIDENTIEL
En fonction du montant de la commande de pieces de rechange, les reductions
suivantes sont appliquees :
<TABLE>
<CAPTION>
Montant de la commande reduction
<S> <C> <C>
0,25 MF a 0,50 MF 5 %
0,50 MF a 1,00 MF 10 %
1,00 MF a 2,50 MF 15 %
2,50 MF a 5,00 MF 20 %
5,00 MF et plus 22,5 %
</TABLE>
Ces reductions ne sont pas applicables au prix de l'echange standard.
Les prix ci-dessus sont EXW.
<PAGE> 231
VERSION N(degree) 2 PROJET CONFIDENTIEL
ANNEXE 5: NIVEAUX DE QUALITE ACCEPTABLE DES TERMINAUX SCISCAN
POUR LA RECEPTION DES TERMINAUX SCISCAN
On doit d'abord considerer que les defauts seront repartis en 2 classes:
Defaut majeur:
Defaut d'assemblage qui genere une panne de materiel a court terme ou defaut
fonctionnel.
Defaut mineur:
Defaut d'aspect ou defaut d'assemblage sans incidence sur le fonctionnement du
materiel.
La quantite mensuelle prevue etant de 1000 a 25 00 Terminaux, on considere qu'il
y aura 1 recette chaque semaine.
Nous proposons les NQA suivants:
- - 1% pour les defauts majeurs - 4% pour les defauts mineurs.
Toutefois, ces NQA, suivant la norme NFX 06 022 (niveau 11), conduisent a
accepter des lots dont les prelevements presentent des defauts:
Par exemple, sur un prelevement de 50 materiels:
- - NQA 1%: defauts majeurs: lot Accepte a 1 defaut et Refuse a 2 defauts
- - NQA 4%: defauts mineurs : lot Accepte a 5 defauts et Refuse a 6 defauts.
La liste des defauts majeurs et des defauts mineurs sera elaboree d'un commun
accord entre SGI et SAGEM.
Aucun defaut critique (defaut qui met en cause la securite de l'utilisateur)
n'est accepte.
<PAGE> 232
VERSION N(degree)2 PROJET CONFIDENTIEL
ANNEXE 6 : MAINTENANCE ATELIER DES TERMINAUX SCISCAN
1. Organisation des relations entre SGI et SAGEM pour la maintenance des
Terminaux SciScan
Avant toute expedition de materiel, SGI remplit les zones suivantes du
formulaire ARM joint:
date, expedition (adresse), no de fax, no de tel.,
designation;
reference du terminal ou de la piece la piece (code SAGEM),
no de serie de l'appareil concerne (provenance de la piece) ou "date-code"
exp: 18/90,
cette information, relevee sur la piece reparable, indique la semaine et annee
de fabrication,
- - garantie: indiquer HG (Hors Garantie) ou SG (Sous Garantie)
SGI transmet par Fax le document ARM remplit au service reparations SAGEM
concerne
SAGEM retourne PARM a SGI apres attribution d'un no d'ordre, date, nom du
gestionnaire et coordonnees pour l'envoi des pieces ou des terminaux a reparer.
SGI expedie les pieces a reparer au Centre de Distribution / Reparation SAGEM
concerne, enjoignant au colis une copie de PARM.
SAGEM se refere au no d'ARM pour le suivi et la gestion de l'envoi. Ce numero
est a rappeler pour toute demande de renseignements et dans toute
correspondance.
N.B.: IRREPARABILITE
Les elements retournes pour reparation/echange-standard, pourront etre reconnus
irreparables par SAGEM et, de ce fait, retournes a SGI en l'etat, dans les cas
suivants
- - dommage cause par un usage contraire aux conditions normales d'utilisation,
- - reception de sous-ensembles incomplets (manque de composants), d'elements
mecaniques, etc ... ),
- - modification de l'etat original du materiel,
- - tentative de reparation ayant degrade le sous-ensemble.
SAGEM en avisera le responsable du service technique de SGI.
<PAGE> 233
VERSION N(degree)2 PROJET CONFIDENTIEL
2. Maintenance des Terminaux SciScan
Au titre de la maintenance des Terminaux SciScan, SAGEM s'engage a fournir a SGI
les equipements pour rechange, ainsi que les pieces detachees et les facilites
de reparation.
a) Plages des demandes d'intervention
Jours ouvres de 8h30 a 16h3O
b) Delai de prise en compte des demandes d'intervention Jours ouvres de 8h30 a
16h3O
c) Delais d'intervention
Le delai d'intervention de SAGEM est defini comme le delai compris entre le jour
ouvre de reception de l'element defectueux et la date d'envoi de l'element
repare.
d) Description de la maintenance
Les modules ou elements defectueux, ou les materiels complets, sont retournes a
SAGEM pour reparation.
Les frais de transport et d'assurance des modules ou elements defectueux vers
l'usine sont a la charge de SGI, les frais de transport et d'assurance des
modules repares etant a la charge de SAGEM.
En tout etat de cause et quelle que soit leur nature, SAGEM s'engage a mettre en
oeuvre tous les moyens utiles et necessaires pour resoudre les problemes
techniques rencontres par SGI. Cette obligation comprend, notamment, les
solutions techniques appropriees, le personnel qualifie et competent, ainsi
qu'une rapidite d'execution.
La maintenance consiste en la reparation ou l'echange de l'element defectueux,
de maniere a ce que le materiel soit dans un etat de fonctionnement normal.
La piece echangee peut ne pas etre neuve, mais elle doit etre apte a l'usage
auquel elle est destinee. La piece reprise devient la propriete de SAGEM.
Les frais de remplacement, de main oeuvre, d'expedition a SGI sont a la charge
de SAGEM.
SAGEM devra proceder a la reparation des elements defectueux dans les 10 jours
ouvres.
Tout retard de SAGEM dans la remise en etat de marche du materiel donne a SGI la
faculte d'appliquer a SAGEM les penalites prevues a l'article
<PAGE> 234
VERSION N(degree) 2 PROJET CONFIDENTIEL
Sont exclus de la maintenance:
- Les pannes ou dysfonctionnements dus a la mauvaise utilisation
des materiels ou au non respect des consignes d'utilisation et
d'installation.
- Les pannes ou dysfonctionnements dus a une cause exterieure
aux materiels (choc, bris, accident, humidite, degats des eaux
et de liquides divers, foudre, court-circuit, defaut
d'alimentation ou d'energie, acte de vandalisme, vol ou
tentative de vol, ligne defectueuse, ... ).
- L'usure normale des materiels ainsi que l'usure des
accessoires.
- Les pannes ou dysfonctionnements causes par des modifications
ou des ajouts effectues sans l'accord ecrit de SAGEM sur les
materiels.
- Les dommages dus au defaut d'entretien courant, tel que decrit
dans le livret d'utilisation, au defaut de surveillance ou de
soins.
- Les dommages resultant de reparations ou d'entretien effectues
par des personnes non agrees par SAGEM.
- Les pannes ou dommages causes par l'utilisation de
consommables autres que ceux recommandes par SAGEM
- Les deteriorations consecutives ou dues a une insuffisance
d'emballage et/ou a un mauvais conditionnement du materiel
reexpedie a SAGEM.
- Le defaut de transmission (reseau de telecommunication) et
notamment la mauvaise couverture de sites geographiques par
les emetteurs radioelectriques, les interferences, les
brouillages lies aux conditions atmospheriques, la defaillance
ou la mauvaise qualite des lignes telephoniques, ...
- Les defectuosites dues aux mauvaises conditions
d'environnement du materiel.
Dans le cas ou la demande d'intervention adressee par SGI n'est pas imputable a
une fourniture livree par SAGEM (materiels, Logiciels, etc.), cette derniere
sera en doit de facturer le temps passe au prix en vigueur a la date de son
intervention, frais de deplacement en sus.
3. Prix de la maintenance en usine des terminaux SciScan
Sous reserve d'une utilisation des terminaux conforme au profil de mission,
SAGEM assurera la reparation en usine des terminaux defectueux dans les
conditions suivantes:
a) pendant les 3 annees suivant la periode de garantie
Prix par terminal et par an FrF H.T.490
b) pendant les 3 annees suivantes
Prix par terminal et par an FrF H.T.700
Ces prix sont valables si la maintenance de l'ensemble des terminaux est confiee
a SAGEM
Ces prix n'incluent pas:
les couts engendres par la recherche de pannes sur des terminaux recus et
trouves en etat de fonctionnement.
le remplacement des pieces d'aspect abimees Ces couts seront factures en plus.
<PAGE> 235
VERSION N(degree)2 PROJET CONFIDENTIEL
SAGEM
SAGEM sA
Autorisation de Retour N(degree):
de Materiel Date:
No Site: Date:
DESTINATAIRE ARM ADRESSE D'EXPEDITION POUR LES PIECES
(Joindre I'ARM numerote a votre expedition)
<TABLE>
<S> <C> <C>
SAGEM sA Departement Telecopie n SAGEM sA SAGEM SA
et Telephonie sans fil Service client SAV TELEPHONIE SANS FI
Z.I. de la Guenaudiere Z.I DE QUEVERT B.P 130
Service Gestion des Reparations 2, rue de la Lande du Bas
4, rue du petit ALBI 35300 FOUGERES 22103 DINAN CEDEX
B. P. 8448
95807 CERGY PONTOISE CEDEX SAGEM SA SAGEM SA
FRANCE Service Distribution et Reparation SAV Monetique
Boulevard Lenine - B.P. 428 278, Chaussee Femand Eor
Fax: 01 40 70 84 73 76805 ST ETIENNE DU ROUVRAY 59203 TOURCOING z
EXPEDITEUR:
Date d'arrivee Date de reexpedition
Service Reparation Fax: Service Reparation
1 Date:
N* DP: Tel:
</TABLE>
LISTE DES MATERIELS RETOURNES
<TABLE>
<CAPTION>
N* SERIE GARANTIE
DESIGNATION CODESAGEM ou S.G. H.G. OBS.
DATE CODE P.U. HT_ (Inventaire)
TOTAL HT
<S> <C> <C> <C> <C> <C>
<<Bon pour acceptation du devis>> Date: Votre No de commande:
(A retourner signe par fax Nom: Signature:
en cas d'accord ou de refus)
</TABLE>
<PAGE> 236
VERSION N(degree)2 PROJET CONFIDENTIEL
ANNEXE 7: REPRESENTANTS DES PARTIES ET MEMBRES
DU COMITE DE SUIVI
Pour SAGEM:
coordinateur principal Jean-Yves VALET
coordinateur adjoint: Jean-Francois LALLEMANT
Pour SGI:
coordinateur principal Tyler M. RYAN
coordinateur adjoint: Christian RADAKOVITS
<PAGE> 237
VERSION N(degree) 2 PROJET CONFIDENTIEL
ANNEXE 8: ENGAGEMENTS DE PERFORMANCE
1. Definition du profil de mission du terminal
Environnement normal Sous tension 241-L/24 nombre de tickets lus par an par an
en moyenne: 16 700 Imprimante: 2 km de papier par an
2 millions d'impulsions elementaires d'ecriture
La maintenance preventive, par l'operateur, du module lecture de ticket est
effectue suivant les recommandations de SGI
2. Fiabilite du terminal
Dans le cadre de profil de mission defini ci dessus la fiabilite du terminal
sera, apres la periode de deploiement sur le terrain, meilleure que:
0,8 panne par an et par appareil pendant les 4 annees suivant la livraison du
terminal 1 panne par an et par appareil pendant les 3 annees suivantes
ces chiffres sont bases sur le fait que la partie detection latex represente
moins de 10% des pannes.
<PAGE> 238
VERSION N(degree)2 PROJET CONFIDENTIEL
ANNEXE 9: LISTE DES OUTILLAGES FOURNIS PAR SGI
Outillages de fabrication
Tous les moules pour pieces en plastique existantes dans le terminal SCISCAN
2000 et utilisees pour Fortuna
Tous les outillages de tolerie pour pieces en tole existantes dans le terminal
SCISCAN 2000 et utilisees pour Fortuna
Les schemas, les fichiers de fabrication et controle de la carte MCPIII, de la
carte LATEX, ~ des cordons
Les nomenclatures autres qu'electroniques du terminal SCISCAN 2000: pieces
mecaniques!
Les dossiers de procedures d'integration du terminal
La liste des fournisseurs actuels de pieces et modules Fortuna
Outillages de recette
Le logiciel de recette pour PC, appele
"Manufacturing Quality Assurance Software"
Les specifications d'utilisation.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF SCIENTIFIC GAMES HOLDING CORPORATION FOR THE SIX MONTH
PERIOD ENDED JUNE 30, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> JUN-30-1999
<CASH> 13,732
<SECURITIES> 0
<RECEIVABLES> 49,805
<ALLOWANCES> 242
<INVENTORY> 15,280
<CURRENT-ASSETS> 83,018
<PP&E> 121,767
<DEPRECIATION> 62,295
<TOTAL-ASSETS> 193,404
<CURRENT-LIABILITIES> 54,139
<BONDS> 0
0
0
<COMMON> 12
<OTHER-SE> 122,117
<TOTAL-LIABILITY-AND-EQUITY> 122,129
<SALES> 109,790
<TOTAL-REVENUES> 109,790
<CGS> 69,294
<TOTAL-COSTS> 69,294
<OTHER-EXPENSES> 23,664
<LOSS-PROVISION> 1
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 16,709
<INCOME-TAX> 6,273
<INCOME-CONTINUING> 10,436
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 10,436
<EPS-BASIC> 0.88
<EPS-DILUTED> 0.87
</TABLE>
