Document:

Exhibit
10.46

    

    INDUSTRY DOMAINS
REGISTRATION AGREEMENT

    

    THIS
AGREEMENT (the “Agreement”), made effective this 16th day of
September, 2009 (“Effective Date”) by and between KEY-SYSTEMS, GMBH, a limited
liability company duly organized under the laws of the Country of Germany,
(hereinafter “KEY-SYSTEMS”), and DOT VN, Inc., a corporation duly organized
under the laws of the State of Delaware (hereinafter “DOT VN”) (referred to
collectively as the “Parties”).

    

    WHEREAS, DOT VN provides registration
of certain Vietnamese sub-domains (referred to herein as “Industry
Domains”);

    

    WHEREAS, KEY-SYSTEMS provides a
registrar software and technical services worldwide;

    

    WHEREAS,
DOT VN desires to provide its services through KEY-SYSTEMS; and

    

    WHEREAS, KEY-SYSTEMS and DOT VN are
both willing to work jointly to provide such services;

    

    NOW, THEREFORE, in light of the mutual
promises and covenants hereinafter set forth and for consideration the
sufficiency and receipt of which is hereby acknowledged, the Parties agree to as
follows:

    

    ARTICLE
I

    INDUSTRY DOMAIN
PROGRAM

    

    
      	
              A.

            	
              Structure of Industry
      Domain Program

            

    

     

    1.           The Parties will implement and provide registration for
a new class of Vietnamese ccTLD sub-domains, which shall comprise the
twenty-four (24) second level extensions listed in Exhibit A (the “Industry Domain Program”).

     

    2.           KEY-SYSTEMS
shall provide technical services, including but not limited to hardware and
software, and business development support in the creation and commercialization
of the Industry Domain Program, hosting of the registration platform, backup of
all data and applications as well as such other support as may be required for
the project from time to time.

     

    
      	
               
      

            	
              i)

            	
              In
      connection with KEY-SYSTEMS’ technical services, KEY-SYSTEMS shall take
      all reasonable steps to ensure that data is properly stored and backed up
      such that an operational uptime of 99.8% is
  guaranteed.

            

    

     

    
      	
               
      

            	
              ii)

            	
              KEY-SYSTEMS
      may also be required at the request of DOT VN to provide backup copies of
      all records and databases related to the operation of the Industry Domain
      Program on an as requested basis.

            

    

     

    
      
        
        

      

      
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    3.           KEY-SYSTEMS
shall also offer the Industry Domains through its retail registration portal,
www.domaindiscount24.com, as well as through its reseller network subject to the
following terms:

     

    
      	
               
      

            	
              i)

            	
              KEY-SYSTEMS
      shall be entitled to purchase for resale Industry Domains at the Master
      Reseller Rate as set forth in Exhibit
      B;

            

    

     

    
      	
               
      

            	
              ii)

            	
              KEY-SYSTEMS
      shall be entitled to offer the Industry Domains to its reseller network at
      such rate as they deem appropriate;
and

            

    

     

    
      	
               
      

            	
              iii)

            	
              KEY-SYSTEMS
      may offer the Industry Domains on its retail registration portal,
      www.domaindiscount24.com, at a price equal to one hundred and ten percent
      (110%) of the retail price as set forth in Exhibit B or
      such other price as may be agreed to by the Parties from time to
      time.

            

    

     

    4.           DOT
VN shall provide governmental policy support, infrastructure and technological
access in furtherance of the creation and commercialization of Industry Domain
Program, as well as such other support as may be required for the project from
time to time.

     

    
      	
              B.

            	
              Payment

            

    

     

    1.           In
consideration for their respective investment in the development of a Industry
Domain Program, KEY-SYSTEMS shall be entitled to fifteen percent (15%) of the
gross master reseller rate of the Industry Domains in accordance with the
schedule set forth in Exhibit
B

     

    2.           DOT
VN shall be responsible for the receipt, accounting and distribution of all
monies received in connection with the Industry Domain Program and shall provide
a payment gateway to effect such transactions.

     

    3.           Distributions
of all revenue, in accordance with Article I(B)(1), shall be made on a monthly
net 15 basis to KEY-SYSTEMS via wire transfer to KEY-SYSTEMS’
account.  KEY-SYSTEMS shall provide all wire information in writing
within ten (10) business days of the signing of this agreement.

     

    ARTICLE
II

    REPRESENTATIONS AND
WARRANTIES

    

    
      	
              A.

            	
              Representations and
      Warranties by KEY-SYSTEMS.

            

    

    

    1.           Organization.  KEY-SYSTEMS
is a limited liability company duly organized, validly existing and in good
standing under the laws of the country of Germany.

    

    
      
        
        

      

      
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    2.           Authority; Consents and
Approvals; No Violations.  KEY-SYSTEMS has the full corporate
power and authority and legal right to execute and deliver this Agreement, and
otherwise to perform its obligations hereunder.  This Agreement has
been validly executed and delivered by KEY-SYSTEMS and will constitute a valid
and binding obligation of KEY-SYSTEMS enforceable in accordance with its terms,
except to the extent such enforceability may be limited by the effects of
bankruptcy, insolvency, reorganization, moratorium or other similar
laws  affecting creditors' rights generally, and by the effect of
general principles of equitable law, regardless of whether such enforceability
is considered in a proceeding in equity or at law.  The execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby do not and will not violate any provision of KEY-SYSTEMS' formational and
organizational documents or violate, conflict with, result in a breach of or
constitute (with or without due notice, lapse of time or both) a default under
any agreement, license, contract, franchise, permit, indenture, lease, or other
instrument to which KEY-SYSTEMS is a party, or by which it or any of its assets
are bound.

    

    3.           Intellectual
Property. KEY-SYSTEMS warrants and represents that the exercise of
any rights by DOT VN in accordance with this Agreement will not infringe upon
the any right of any third party.

    

    i)            All
intellectual property that KEY-SYSTEMS uses and provides to DOT VN does not
infringe any patent, trademark, trade name, copyright or title.

    

    ii)           KEY-SYSTEMS
has taken all reasonable steps to secure such licenses and/or patents,
trademarks, trade name or copyright related to the technology, software or
processes associated with the operation of the Industry Domain and Domain
Parking Programs.

    

    iii)          KEY-SYSTEMS
shall grant and assign to DOT VN the benefit of all warranties and
representations made for KEY-SYSTEMS’ benefit by any third party if DOT VN has a
cause of action against such third party or requires such grant or assignment to
defend itself against a lawsuit.

    

    iv)          That
there are no liens, encumbrances and/or obligations in connection with the
technology or processes that Industry Domain and Domain Parking Programs is
based or any of the intellectual property of KEY-SYSTEMS other than such liens,
encumbrances and/or obligations specifically set forth herein or that will not
have a materially adverse effect on the consummation of the transactions
contemplated hereby.

    

    4.           Vietnamese
law.  KEY-SYSTEMS shall, in connection with the Industry Domain
and Domain Parking Programs, comply with any and all restrictions required by
applicable Vietnamese laws and regulations, as amended, including but not
limited to content restrictions so long as DOT VN first notifies KEY-SYSTEMS of
such content restrictions.

    

    
      	
              B.

            	
              Representations and
      Warranties by DOT
      VN.

            

    

    

    1.                           Organization.  DOT VN is a
corporation duly organized, validly existing and in good standing under the laws
of the state of Delaware, USA.

    

    
      
        
        

      

      
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    2.                           Authority; Consents and Approvals; No
Violations.  DOT VN has the full corporate power and authority and legal
right to execute and deliver this Agreement, and otherwise to perform its
obligations hereunder.  This Agreement has been validly executed and
delivered by DOT VN and will constitute a valid and binding obligation of
DOT VN
enforceable in accordance with its terms, except to the extent such
enforceability may be limited by the effects of bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors' rights
generally, and by the effect of general principles of equitable law, regardless
of whether such enforceability is considered in a proceeding in equity or at
law.  The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby do not and will not violate
any provision of DOT VN's Certificate of Incorporation or Bylaws or violate,
conflict with, result in a breach of or constitute (with or without due notice,
lapse of time or both) a default under any agreement, license, contract,
franchise, permit, indenture, lease, or other instrument to which DOT VN is a party,
or by which it or any of its assets are bound.

    

    3.                           DOT
VN understands that Key-Systems is not familiar with Vietnam law and that DOT VN
is responsible for informing KEY-SYSTEMS of any content restrictions pertaining
to Vietnam Law prior to there being any problems and as such DOT VN agrees to
indemnify KEY-SYSTEMS for any such problems or issues regarding content which it
fails to provide written notification to KEY-SYSTEMS in accordance with Article
II A(4) above.

    

    4.                           DOT
VN does hereby agree that this Agreement shall not grant DOT VN any title of
ownership to the registrar software provided by KEY-SYSTEMS, nor shall it grant
DOT VN any title of license to use, sell or otherwise make available the
registrar software beyond the scope and duration of this agreement. DOT VN
further agrees not to reverse engineer the registrar software or develop similar
registrar software based on the registrar software provided by KEY-SYSTEMS. This
paragraph shall survive the termination of the Agreement.

    

    ARTICLE
III

    CONFIDENTIALITY

    

    
      	
              
              

            	
              A.

            	
              Acknowledgment.  Both
      Parties acknowledge and agree that both the DOT VN Information and the
      KEY-SYSTEMS Information (collectively the “Information”) is confidential
      and proprietary.  The Parties agree not to use the Information
      during the term of this Agreement for any purpose other than as permitted
      or required for the performance by each Party hereunder.  The
      Parties further agree not to disclose or provide any such Information to
      any third party and to take all necessary measures to prevent any such
      disclosure by its employees, agents, contractors, or consultants during
      the term hereof.  Nothing contained herein shall prevent either
      Party from using, disclosing or authorizing the disclosure of any
      Information which (i) was in the public
      domain at the time it was disclosed or has entered the public domain
      through no fault of the receiving party; (ii) was independently developed
      by the receiving party without any use of the Information; or (iii) became
      known to the receiving party, without restriction, from a source other
      than the disclosing party, without breach of this Agreement by the
      receiving party and otherwise  not in violation of the
      disclosing party's rights.  In addition, the receiving party may
      disclose the other party’s Information as required under applicable law or
      regulation, including rules of any applicable securities exchange, or
      pursuant to the order or requirement of a court, administrative agency, or
      other governmental body; provided, however, that the receiving party will
      provide prompt prior notice of such disclosure to the disclosing party to
      enable the disclosing party to seek a protective order or otherwise
      restrict such disclosure.

            

    

    

    
      
        
        

      

      
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      ARTICLE
IV

    

    
      INDEMNIFICATION

    

    

    
      	
              
              

            	
              A.

            	
              KEY-SYSTEMS’s
      Obligations.  The KEY-SYSTEMS agrees to indemnify,
      defend, and shall hold harmless DOT VN, its directors, employees and/or
      its agents, and to defend any action brought against said parties with
      respect to any claim, demand, cause of action, debt or liability,
      including reasonable attorneys' fees to the extent that such action is
      based upon a claim, resulting from any action by KEY-SYSTEMS, its
      officers, directors, agents or affiliates during the term of this
      Agreement, and is based upon a claim that: (i) is true, (ii) would
      constitute a breach of any of KEY-SYSTEMS's representations, warranties,
      or agreements hereunder, (iii) arises out of the negligence or willful
      misconduct of KEY-SYSTEMS, or (iv) arises out of the breach of any
      agreement between KEY-SYSTEMS and any third
  party.

            

    

    

    
      	
              
              

            	
              B.

            	
              DOT VN’s
      Obligations.  DOT VN agrees to indemnify, defend, and
      shall hold harmless KEY-SYSTEMS, its directors, employees and agents, and
      defend any action brought against same with respect to any claim, demand,
      cause of action, debt or liability, including reasonable attorneys' fees,
      to the extent that such an action is based upon a claim, resulting from
      any action by DOT VN, its officers, directors, agents or affiliates during
      the term of this Agreement, and is based upon a claim that: (i) is true,
      (ii) would constitute a breach of any of DOT VN’s representations,
      warranties, or agreements hereunder,  (iii) arises out of the
      negligence or willful misconduct of DOT VN or (iv) arises out of the
      breach of any agreement between DOT VN and any third
  party.

            

    

    

    
      	
              
              

            	
              C.

            	
              Notice. In
      claiming any indemnification hereunder, the indemnified party shall
      promptly provide the indemnifying party with written notice of any claim,
      which the indemnified party believes falls within the scope of the
      foregoing paragraphs.  The indemnified party may, at its
      expense, assist in the defense if it so chooses, provided that the
      indemnifying party shall control such defense, and all negotiations
      relative to the settlement of any such claim.  Any settlement
      intended to bind the indemnified party shall not be final without the
      indemnified party's written consent, which shall not be unreasonably
      withheld. 

            

    

    

    
      ARTICLE
V

    

    
      TERM AND
TERMINATION

    

    

    
      	
              
              

            	
              A.

            	
              Term.  This
      Agreement shall take effect as of the Effective Date and shall continue
      for a period of five (5) years.  Thereafter, this Agreement
      shall be renewed for additional periods of one (1) year each, if each of
      the parties shall give the other notice of its renewal of this Agreement
      no later than one hundred twenty (120) days prior to the end of the term
      of this Agreement.

            

    

    

    
      	
              
              

            	
              B.

            	
              Termination.  Notwithstanding
      the provisions of Article VI(A) above, this Agreement may be terminated in
      accordance with the following
provisions:

            

    

    

    
      
        
        

      

      
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    1.           Either
party hereto may terminate this Agreement at anytime by giving notice in writing
to the other party, which shall be effective upon dispatch, should the other
party file a petition of any type as to its bankruptcy, be declared bankrupt,
become insolvent, make an assignment for the benefit of its creditors, go into
liquidation or receivership.

    

    2.           Either
party may terminate this Agreement by giving notice in writing to the other
party should an event of Force Majeure continue for more than six (6) months as
provided in Article VI(D) below.

    

    3.           Either
party may terminate this Agreement by giving notice in writing to the other
party in the event the other party is in material breach of this Agreement and
shall have failed to cure such breach within thirty (30) days of receipt of
written notice thereof from the non-breaching party.

    

    4.           Either
party may terminate this Agreement for any reason via notice in writing to the
other party provided that such termination is effective six (6) months after
receipt of such written notice.

    

    5.           The
Parties may at any time mutually terminate this Agreement, provided that such
termination is evidenced by written document signed by both
Parties.

    

    
      	
              
              

            	
              C.

            	
              Rights and Obligations
      upon Termination.  In the event of termination of this
      Agreement for any reason, the parties shall have the following rights and
      obligation:

            

    

    

    1.           Termination
of the Agreement shall not release either party from the obligation to make
payment on all amounts due as of the date of Termination.

    

    2.           The
Parties obligations pursuant to Article II B.4, III and IV hereof shall survive
the termination of this agreement.

    

    3.           Upon termination of this Agreement, the Parties will
cease to display or otherwise use all trademarks, service marks, trade names,
copyrights, other proprietary designations, and variations and combinations
thereof, for which consent to display or otherwise use was granted, and will
deliver to the owner or destroy them, at the owner’s sole discretion, free of
any charge, all materials of any type or kind displaying or otherwise using the
same which are in the other Party’s control.

    

    4.           Upon termination any payments outstanding shall be paid
in accordance with the terms of this agreement until all obligations are
satisfied.

    

    
      
        
        

      

      
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    ARTICLE
VI

    FORCE
MAJEURE

    

    
      	
              
              

            	
              A.

            	
              Definition.  Force
      Majeure shall mean any event or condition, not existing as of the date of
      signature of this Agreement, not reasonably foreseeable as of such date
      and not reasonably within the control of either party, which prevents in
      whole or in material part, the performance by one of the parties of its
      obligations hereunder or which renders such obligations so difficult or
      costly as to make such performance commercially
      unreasonable.  Without limiting the foregoing, the following
      shall constitute events or conditions of Force Majeure: acts of State or
      governmental action, riots, disturbance, war, strikes, terrorism,
      lockouts, slowdowns, prolongs shortage of energy supplies, epidemics,
      fire, flood, hurricane, typhoon, earthquake, lightning and
      explosion.  It is in particular expressly agreed that any
      changes to any applicable Vietnamese laws or regulations which would
      affect the fulfillment by DOT VN of its obligations hereunder shall
      constitute an event of Force
Majeure.

            

    

    

    
      	
              
              

            	
              B.

            	
              Notice.  Upon
      giving notice to the other party, a party affected by an event of Force
      Majeure shall be released without any liability on its part from the
      performance of obligations under this Agreement, except for the
      obligations under Articles III, IV and V(C), but only to the extent and
      only for the period that its performance of such obligations is prevented
      by the event of Force Majeure.  Such notice shall include a
      description of the event of Force Majeure, and its cause and possible
      consequences.  The party claim Force Majeure shall promptly
      notify the other party of the termination of such
      event.

            

    

    

    
      	
              
              

            	
              C.

            	
              Suspension of
      Performance.  During
      the period that the performance by one of the parties of its obligations
      under this Agreement has been suspended by reason of an event of Force
      Majeure, the other party may likewise suspend the performance of all or
      part of its obligations hereunder to the extent that such suspension is
      commercially reasonable.

            

    

    

    
      	
              
              

            	
              D.

            	
              Termination.  Should
      the period of Force Majeure continue for more than six (6) consecutive
      months, either party may terminate this Agreement without liability to the
      other party except for payments due to such date, upon giving
      written notice to the other party.

            

    

    

    ARTICLE
VIII

    MISCELLANEOUS

    

    
      	
              
              

            	
              A.

            	
              Relationship.  This
      Agreement does not make either party the employee, agent or legal
      representative of the other for any purpose whatsoever.  Neither
      party is granted any right or authority to assume or to create any
      obligation or responsibility, express or implied, on behalf of or in the
      name of the other party.  In fulfilling its obligations pursuant
      to this Agreement each party shall be acting as an independent
      contractor.

            

    

    

    
      	
              
              

            	
              B.

            	
              Assignment.  Neither
      party shall have the right to assign or to otherwise transfer its rights
      and obligations under this Agreement except with the prior written consent
      of the other party.  Further any successor in interest by
      merger, operation of law, assignment, purchase or otherwise of the entire
      party shall acquire all rights and obligations of such party
      hereunder.  Any prohibited assignment shall be null and
      void.  If such other party consents as stated above, any
      potential assignee must agree to abide by the terms and conditions of this
      Agreement.  "Assignment" shall be deemed to include the transfer
      of substantially all the assets of, or majority interest in the voting
      stock of, either party, or the merger of either party with one or more
      third parties which changes the majority ownership of the
      party.

            

    

    

    
      
        
        

      

      
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                  C.

                	
                  Disputes.  In
      the event of any dispute, the parties respective decision makers agree to
      meet within ten (10) business days and in good faith seek an informal
      resolution of the disputed issue.  If no resolution is reached,
      the parties agree to submit any claim, dispute or controversy (“Claim”)
      against the other, or against the employees, agents or assigns of the
      other, arising from or relating in any way to this Agreement, including
      Claims regarding the applicability of this arbitration clause or the
      validity of the entire Agreement, to binding arbitration to be
      administered by JAMS, in San Diego, California, under its Streamlined
      Rules, unless the parties otherwise agree.  The sole arbitrator
      shall have the power to determine issues of arbitrability, and shall apply
      the laws of the State of California, except for, and limited only to
      claims or issues where California law is preempted by federal
      statute.  All other issues shall be governed by applicable
      California law, excluding the Convention on Contracts for the
      International Sale of Goods and that body of law known as conflicts of
      laws.  If the parties cannot agree on a single arbitrator, a
      panel of 3 arbitrators shall be employed, the parties each selecting one
      arbitrator, and the two arbitrators so selected shall choose a third
      “independent” arbitrator.  All arbitrators must either be
      licensed attorneys or retired judges.  The parties shall have
      right to full discovery to the extent permitted by the California Code of
      Civil Procedure and California Rules of Court applicable to judicial
      arbitrations.  The arbitrator(s) shall be empowered to appoint
      experts and/or consultants, resolve discovery disputes grant equitable
      relief, compensatory and punitive damages, and grant any relief a party
      could obtain in an action initiated in the a California Superior Court,
      proceed ex-parte should one party fail to appear, and grant any other type
      of relief appropriate to the particular circumstances.  The
      arbitrator shall have the power to award the prevailing party its
      litigation expenses including reasonable attorney’s fees and costs, and
      expert witness fees.  The hearing shall take place within 6
      months of submission to arbitration.  No pre-hearing motions may
      be filed, other than with respect to requests for injunctive relief and
      discovery disputes.  All arbitration hearings shall be via
      telephone.  Judgment may be entered in any court of competent
      jurisdiction.  The parties agree that all proceedings are
      confidential in perpetuity, except as required by applicable law or
      pursuant to the authority of a regulatory
body.

                

        

      

      

      
        
          	
                	
                  D.

                	
                  Amendment.  This
      Agreement may not be modified or amended except by an instrument in
      writing signed by each of the parties hereto, or their respective
      permitted successors in
interest.

                

        

      

      

      
        
          	
                	
                  E.

                	
                  Waiver.  No
      term or condition of this Agreement shall be deemed to have been waived,
      nor any estoppel against the enforcement of any provision of this
      Agreement, except by written instrument of the party charged with such
      waiver or estoppel.  In addition, no such written waiver or
      estoppel that is in effect shall be deemed to be a continuing waiver
      unless specifically stated therein, shall operate only as to the specific
      term or condition waived and shall not constitute a waiver as to any act
      other than that specifically waived or as to any term, condition or
      obligation that comes into effect subsequent to the written
      waiver.

                

        

      

       

      
        
           

        

        
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                F.

              	
                Agreement in
      Counterparts.  This Agreement may be executed in
      counterparts, each of which thus executed shall be deemed an original, but
      all of which, taken together, shall constitute one and the same agreement,
      binding upon the parties hereto, their administrators, successors and
      permitted assigns.

              

      

      

      
        	
              	
                G.

              	
                Severability.  If
      any provision of this Agreement, or the application thereof, shall be
      determined by a court of competent jurisdiction to be invalid or
      unenforceable, then this Agreement shall remain in full force and effect
      between the parties to the greatest extent permitted by law unless the
      invalidity or unenforceability of such provision or provisions destroys or
      materially impairs the basis of the bargain between the parties as
      contained in this Agreement.

              

      

      

      
        	
              	
                H.

              	
                Captions;
      References.  Article and paragraph headings in this
      Agreement are for convenience of reference only and shall not affect the
      construction or interpretation of this Agreement.  Whenever the
      terms "hereof", "hereby", "herein" or words of similar import are used in
      this Agreement they shall be construed as referring to this Agreement in
      its entirety rather than to a particular paragraph or provision, unless
      the context specifically indicates to the contrary.  Any
      reference to a particular or "Paragraph" or “Article” shall be construed
      as referring to the indicated paragraph or section of this Agreement
      unless the context specifically indicates to the
  contrary.

              

      

      

      
        	
                 
      

              	
                I.

              	
                Notices. Any notice,
      direction or other instrument required or permitted to be given under or
      in connection with this Agreement shall be effective when either delivered
      personally, mailed by certified mail, return receipt requested (with
      postage prepaid), to the addresses listed below, or deposited with Federal
      Express or other reputable courier (with fee prepaid) for overnight
      delivery to the addresses listed
below:

              

      

      

      If to DOT VN:

      

      DOT VN,
INC.

      Attn:
Legal Department

      9449
Balboa Ave., Suite 114

      San
Diego, California 92123

      

      If to KEY-SYSTEMS:

      

      KEY-SYSTEMS,
GMBH

      Attn:
Alexander Siffrin

      Prager
Ring 4-12

      Building
5

      66482
Zweibrücken

      Germany

      
        
           

        

        
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      Any party may change its address for
service from time to time by notice given in accordance with the foregoing and
any subsequent notice shall be sent to the party at its new address, as so
noticed.

       

      
        	
                 
      

              	
                J.

              	
                Entire Agreement.  The parties have read this Agreement
      and agree to be bound by its terms, and further agree that it constitutes
      the complete and entire Agreement of the parties and supersedes all
      previous and contemporaneous communications, oral, implied or written, and
      all other communications between them relating to the subject matter
      thereof.  No representations or statements of any kind in
      relation to the subject matter hereof made by either party, which are not
      expressly stated herein, shall be binding on such
      party.

              

      

      

      IN WITNESS WHEREOF, the
parties hereto have signed this Agreement, thereunto duly authorized on the day
and year above written.

      

      
        
          
            
              
                	
                        DOT
      VN, INC.

                      	 	
                        KEY-SYSTEMS,
      GMBH

                      
	 
      	 
      	 	 
      	 
      
	 
      	 
      	 	 
      	 
      
	 
      	
                        /s/ Thomas Johnson

                      	 	 
      	
                        /s/ Alexander Siffrin

                      
	 
      	 
      	 	 
      	 
      
	
                        By:

                      	
                        Thomas
      Johnson

                      	 	
                        By:

                      	
                        Alexander
      Siffrin

                      
	
                        Its:

                      	
                        Chief
      Executive Officer

                      	 	
                        Its:

                      	
                        Chief
      Executive
Officer

                      

              

            

          

        

      

       

      
        
           

        

        
          10
of 10THIS
SECURED CONVERTIBLE REDEEMABLE DEBENTURE AND THE SECURITIES INTO WHICH IT IS
CONVERTIBLE (COLLECTIVELY, THE “SECURITIES”), HAVE
NOT BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR
THE SECURITIES COMMISSION OF ANY STATE.  THE SECURITIES ARE BEING
OFFERED PURSUANT TO A SAFE HARBOR FROM REGISTRATION UNDER REGULATION D
PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”).  THE
SECURITIES ARE “RESTRICTED” AND MAY
NOT BE OFFERED OR SOLD UNLESS THE SECURITIES ARE REGISTERED UNDER THE ACT, OR
ELIGIBLE TO BE OFFERED OR SOLD PURSUANT TO AVAILABLE EXEMPTIONS FROM THE
REGISTRATION REQUIREMENTS OF THE ACT AND THE COMPANY WILL BE PROVIDED WITH
OPINION OF COUNSEL OR OTHER SUCH INFORMATION AS IT MAY REASONABLY REQUIRE TO
CONFIRM THAT SUCH EXEMPTIONS ARE AVAILABLE.  FURTHER HEDGING
TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE MADE EXCEPT IN COMPLIANCE WITH
THE ACT.

     

    SECURED
CONVERTIBLE REDEEMABLE DEBENTURE

     

    NEW
MEDIA LOTTERY SERVICES, INC.

     

    Effective
July 20, 2009

    

    
      
        	
                No.  1

              	
                US$300,000

              

      

    

    

    This
Secured Convertible Redeemable Debenture (this “Debenture”) is issued
by New Media Lottery Services, Inc., a Delaware corporation (the “Company”), to
Trafalgar Capital Specialized Investment Fund, FIS (together with its permitted
successors and assigns, the “Holder”) pursuant to
exemptions from registration under Section 4(2) and/or Regulation D as
promulgated by the U.S. Securities and Exchange Commission (the “SEC”) under the
Securities Act of 1933, as amended, in the amount of Three-Hundred Thousand
United States Dollars (US$300,000) as follows:

     

    Section
1.01       Principal
and Interest.  For value
received, the Company hereby promises to pay to the order of the Holder in
lawful money of the United States of America and in immediately available funds
the principal sum of Three-Hundred Thousand United States
Dollars (US$300,000) together with interest on the unpaid principal of this
Debenture at ten percent (10%) per annum compounded monthly from the date hereof
until paid.  Interest shall be computed on the basis of a 365-day year
and the actual days elapsed and the Holder shall deduct no interest payments at
Closing (as defined in that certain Securities Purchase Agreement, of even date
herewith, by and between the Company and the Holder (the “Purchase
Agreement”).  The entire principal amount outstanding and all
accrued but unpaid interest hereon and the associated redemption premium shall
be paid to the Holder on the twenty-fourth (24th) month
anniversary from the date hereof (the “Maturity
Date”).

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Section
1.02       Optional
Conversion.  The Holder is
entitled, at its option, to convert, and sell on the same day or at any
subsequent time, at any time and from time to time, until payment in full of
this Debenture, all or any part of the principal amount of the Debenture, plus
accrued interest, into shares (the “Conversion Shares”)
of common stock of the Company, par value $0.001 per share (“Common
Stock”).  The number of shares of Common Stock issuable upon a
conversion hereunder equals the quotient obtained by dividing (a) the
outstanding amount of this Debenture to be converted by (y) the Conversion
Price.  The “Conversion Price”
shall mean the lower of (a) 100% of the Volume Weighted Average Price
(“VWAP”) of the
Common Stock as reported by Bloomberg, LP on the day prior to the Closing Date
(as defined in the Purchase Agreement) the (“Fixed Conversion
Price”) and (b) a fifteen percent (15%) discount to the lowest daily
closing VWAP of the Common Stock during the five (5) trading days after the
Conversion Date (as defined below).  No fraction of shares or scrip
representing fractions of shares will be issued on conversion, but the number of
shares issuable shall be rounded to the nearest whole share.  To
convert this Debenture, the Holder hereof shall deliver written notice thereof,
substantially in the form of Exhibit A to
this Debenture, with appropriate insertions (the “Conversion Notice”),
to the Company at its address as set forth herein.  The date upon
which the conversion shall be effective (the “Conversion Date”)
shall be deemed to be the date set forth in the Conversion Notice.

     

    Section
1.03       Limitations
on Conversion.  The Holder shall not have the right to convert
more than Fifty Thousand United States Dollars ($50,000) of the principal amount
of the Debenture plus accrued interest per week.  If the Holder has
delivered a Conversion Notice for an outstanding amount of this Debenture that,
without regard to any other shares that the Holder or its affiliates may
beneficially own, would result in the issuance in excess of the permitted amount
hereunder, the Company shall notify the Holder of this fact and shall honor the
conversion for the maximum principal amount permitted to be converted on such
Conversion Date in accordance with the terms of this Debenture and, any
principal amount tendered for conversion in excess of the permitted amount
hereunder shall remain outstanding under this Debenture.

     

    Section
1.04       Reservation
of Common Stock.  The Company shall
reserve and keep available out of its authorized but unissued shares of Common
Stock, solely for the purpose of effecting the conversion of this Debenture,
such number of shares of Common Stock as shall from time to time be sufficient
to effect such conversion, based upon the Conversion Price.  If at any
time the Company does not have a sufficient number of Conversion Shares
authorized and available, then the Company shall take any and all actions
required by Section 5(e) of the Purchase Agreement.

     

    Section
1.05       Optional
Redemption. The Company may redeem
this Debenture, in whole or in part, at any time after the Closing Date by
providing the Holder with three (3) days advance notice (the “Redemption Notice”)
and by paying unpaid principal and interest accrued to the date of such
redemption and a twelve and one-half percent (12.5%) redemption premium (the
“Redemption
Premium”) on the amount redeemed so long as the Common Stock is trading
below the Fixed Conversion Price at the time the Redemption Notice is
received.  The date upon which a redemption or payment of principal
and/or interest is made shall be a “Repayment
Date”).

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    Section
1.06       Mandatory
Redemption. Commencing on October
30, 2009 and each month thereafter through the Maturity Date, the Company shall
make payments of (i) US$13,864.58 of outstanding principal, plus (ii) applicable
accrued interest on the outstanding balance as of such payment date, plus (iii)
the Redemption Premium on the principal amount redeemed.  In addition,
upon the Company’s successful completion of any capital raise in excess of One
Million United States Dollars (US$1,000,000), all unpaid principal and accrued
but unpaid interest hereunder plus a Redemption Premium on the amount redeemed
shall be immediately due and payable.

     

    Section
1.07       Paying
Agent and Registrar.  Initially, the Company will act as paying
agent and registrar.  The Company may change any paying agent,
registrar, or Company-registrar by giving the Holder not less than ten (10)
business days’ written notice of its election to do so, specifying the name,
address, telephone number and facsimile number of the paying agent or
registrar.  The Company may act in any such capacity.

     

    Section
1.08       Secured
Nature of Debenture.  This Debenture is secured by those
certain Security Instruments defined in Section 5(o) of the Purchase
Agreement.

     

    Section
1.09       Currency
Exchange Rate Protections.

     

    (a)        “Closing Date Exchange
Rate” means the Euro to US dollar spot exchange rate as determined by the
Holder’s custodian bank on the date of funds transfer to the Escrow Agent’s
account .

     

    (b)        “Repayment Exchange
Rate” means
in relation to each date of a Conversion Notice or date of a Redemption Notice,
the Euro to US
dollar spot exchange rate as quoted by the Holder’s custodian bank on such date
or other such similar source.

     

    (c)        If
on the date of any Conversion Notice or Redemption Notice, the Repayment
Exchange Rate is less than the Closing Date Exchange Rate then the number of
Shares to be issued shall be increased by the same percentage as results from
dividing the Closing Date Exchange Rate by the relevant Repayment Exchange
Rate.  By way of example, if the number of Shares to be issued in
respect of a particular Conversion Notice or Redemption Notice would, but for
this Section 1.08, be 1,000 and if the Closing Date Exchange Rate is 1.80 and
the relevant Repayment Exchange Rate is 1.75, then 1,029 shares of Common Stock
will be issued in relation to that Conversion Notice or Redemption Notice, as
the case may be.  For the avoidance of doubt, the formula for such
calculation, by way of example for this Section, equals ((1.80 /1.75)-1)*1000 =
29 additional shares.

     

    (d)       If
on any Repayment Date, the Cash Payment Date Exchange Rate, as defined below is
less than the Closing Date Exchange Rate then the amount of cash required to
satisfy the amounts due at such time shall be increased by the same percentage
as results from dividing the Closing Date Exchange Rate by the relevant Cash
Payment Date Exchange Rate. “Cash Payment Date Exchange
Rate” means in relation to each
Repayment Date the Euro to US dollar spot
exchange rate as quoted in the London edition of the Financial Times on such
date.  By way of example, if the amount of cash required to repay all
amounts due on such date would, but for this Section 1.08, be US$1,000 and if
the Closing Date Exchange Rate is 1.80 and the relevant Repayment Exchange Rate
is 1.75 then the amount of cash from the cash payment required to repay all
amounts due on such date will be US$1,028.57. For the avoidance of doubt, the
formula for such calculation, by way of example for this Section, equals
((1.80/1.75)-1)*US$1000 = US$28.57 additional dollars.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    ARTICLE
II.

     

    Section
2.01       Amendments
and Waiver of Default.  The Debenture may
not be amended without the written consent of the Holder.

     

    ARTICLE
III.

     

    Section
3.01       Events of
Default.  An Event of
Default is defined as follows: (a) failure by the Company to pay amounts
due hereunder within two (2) calendar days of the required payment date;
(b) failure by the Company’s transfer agent to issue Common Stock (which
shall be freely tradable, if permitted by applicable law) to the Holder within
five (5) calendar days from the Conversion Date; (c) failure by the
Company for ten (10) calendar days after notice to it to comply with any of
its other agreements in this Debenture; (d) events of bankruptcy or
insolvency of the Company; (e) a breach by the Company of its obligations
under any of the Transaction Documents (as such term is defined in the Purchase
Agreement) which is not cured by the Company within ten (10) calendar days after
receipt of written notice thereof.  Upon the occurrence of an Event of
Default, the Holder may, in its sole discretion, accelerate full repayment of
all debentures (including, without limitation, this Debenture) outstanding and
accrued interest thereon or may, notwithstanding any limitations contained in
this Debenture, the Purchase Agreement or any other Transaction Document,
convert all debentures (including, without limitation, this Debenture)
outstanding and accrued interest thereon into shares of Common Stock pursuant to
Section 1.02 herein.

     

    Section
3.02       Failure
to Issue Common Stock.
As indicated in Article III Section 3.01, a breach by the
Company of its obligations under the Purchase Agreement shall be deemed an Event
of Default, which if not cured within ten (10) days, shall entitle the
Holder to accelerate full repayment of all debentures (including, without
limitation, this Debenture) outstanding and accrued interest thereon or,
notwithstanding any limitations contained in this Debenture, the Purchase
Agreement or any other Transaction Document, to convert all debentures
(including, without limitation, this Debenture) outstanding and accrued interest
thereon into shares of Common Stock pursuant to Section 1.02
herein.  The Company acknowledges that failure to honor a Notice of
Conversion shall cause irreparable harm to the Holder.

     

    ARTICLE
IV.

     

    Section
4.01       Rights
and Terms of Conversion.  Subject to
Section 1.03, this Debenture, in whole or in part, may be converted at any time
following the Closing Date, into shares of Common Stock at a price equal to the
Conversion Price as described in Section 1.02 above.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

     

    Section
4.02       Re-issuance
of Debenture.  When the Holder
elects to convert a part of the Debenture or the Company redeems a part of the
Debenture, then the Company shall reissue a new Debenture in the same form as
this Debenture to reflect the new principal amount.

     

    ARTICLE
V.

     

    Section
5.01     
Restriction
on Issuance of the Capital Stock, Incurring Debt or Granting of Security
Interests. So long as any of the
principal of or interest on any debentures (including, without limitation, this
Debenture) remain unpaid, the Company shall  (i) not enter into any
security instrument granting the holder a security interest in any and all
assets of the Company or any subsidiary of the Company (whether now owned or
acquired in the future while any debentures (including, without limitation, this
Debenture) are outstanding without the prior written consent of the Holder, (ii)
not permit any subsidiary of the Company (whether now owned or acquired in the
future while any debentures (including, without limitation, this Debenture) to
enter into any security instrument granting the holder a security interest in
any and all assets of such subsidiary without the prior written consent of the
Holder or (iii) not incur any additional debt or permit any subsidiary of the
Company to incur any additional debt without the prior written consent of the
Holder.

     

    ARTICLE
VI.

     

    Section
6.01       Notice.  Notices regarding
this Debenture shall be sent to the parties at the following addresses, unless a
party notifies the other parties, in writing, of a change of
address:

     

    
      
        	
                If
      to the Company, to:

              	 
      	
                New
      Media Lottery Services, Inc.

              
	 
      	 
      	
                1400
      Technology Drive

              
	 
      	 
      	
                Harrisonburg,
      VA 22802

              
	 
      	 
      	
                Attention:  John
      Carson, President & CEO

              
	 
      	 
      	
                Facsimile:  (540)
      437-1688

              
	 
      	 
      	 
      
	
                With
      a copy to:

              	 
      	
                William
      P. Ruffa, Esq.

                110
      East 59th
      Street

                New
      York, NY 10022

                Telephone:
      (212) 355-0606

                Facsimile:
      1-877-FAX-RUFF

              
	 
      	 
      	 
      
	
                If
      to the Holder:

              	 
      	
                Trafalgar
      Capital Specialized Investment Fund, FIS

              
	 
      	 
      	
                The
      Dickens, Kirk Street

                16
      Northington Street

                London
      WC1N 2DG

              
	 
      	 
      	
                Attention:
      Andrew Garai, Chairman of the Board of

              
	 
      	 
      	
                Trafalgar
      Capital Sarl, General Partner

              
	 
      	 
      	
                Facsimile:      011-44-207-405-0161
      and

                 
         001-786-323-1651

              

      

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    
      
        
          	
                  With
      a copy to:

                	 
      	
                  K&L
      Gates LLP

                
	 
      	 
      	
                  200
      South Biscayne Blvd., Suite 3900

                
	 
      	 
      	
                  Miami,
      FL 33131

                
	 
      	 
      	
                  Attention:  Clayton
      Parker, Esq.

                
	 
      	 
      	
                  Telephone:
      305-539-3306

                
	 
      	 
      	
                  Facsimile:
      305-358-7095

                

        

      

    

    

    Section
6.02       Governing
Law.  This Debenture
shall be deemed to be made under and shall be construed in accordance with the
laws of the State of Delaware without giving effect to the principals of
conflict of laws thereof.  Each of the parties consents to the
jurisdiction of the U.S. District Court sitting in the Southern District of
the State of Florida or the state courts of the State of Florida sitting in
Miami-Dade County, Florida in connection with any dispute arising under this
Debenture and hereby waives, to the maximum extent permitted by law, any
objection, including any objection based on forum non conveniens to the
bringing of any such proceeding in such jurisdictions.

     

    Section
6.03       Severability.  The invalidity of
any of the provisions of this Debenture shall not invalidate or otherwise affect
any of the other provisions of this Debenture, which shall remain in full force
and effect.

     

    Section
6.04       Entire
Agreement and Amendments.  This Debenture
represents the entire agreement between the parties hereto with respect to the
subject matter hereof and there are no representations, warranties or
commitments, except as set forth herein.  This Debenture may be
amended only by an instrument in writing executed by the parties
hereto.

     

    Section
6.05       Counterparts.  This Debenture
may be executed in multiple counterparts, each of which shall be an original,
but all of which shall be deemed to constitute on instrument.

    

    [REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    

    IN WITNESS WHEREOF, with the
intent to be legally bound hereby, the Company as executed this Debenture as of
the date first written above.

     

    
      
        
          
            
              
                	
                        NEW
      MEDIA LOTTERY SERVICES, INC.

                      
	 
      	 
      
	
                        By:

                      	 
      
	
                        Name:

                      
	
                        Title:

                      

              

            

          

        

      

    

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

     

    EXHIBIT
A

     

    NOTICE OF
CONVERSION

     

    (To
be executed by the Holder in order to Convert the Debenture)

     

    
      TO:

    

    
      
      

    

    

    The
undersigned hereby irrevocably elects to convert US$_______________________ of
the principal amount of the above Debenture into Shares of Common Stock of New
Media Lottery Services, Inc., according to the conditions stated therein, as of
the Conversion Date written below.

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              	
                                                      Conversion
      Date:

                                                    	 
      
	 
      	 
      
	
                                                      Applicable
      Conversion Price:

                                                    	 
      
	 
      	 
      
	
                                                      Signature:

                                                    	 
      
	 
      	 
      
	
                                                      Name:

                                                    	 
      
	 
      	 
      
	
                                                      Address:

                                                    	 
      
	 
      	 
      
	
                                                      Amount
      to be converted:

                                                    	
                                                      US$

                                                    	 
      
	 
      	 
      	 
      
	
                                                      Amount
      of Debenture unconverted:

                                                    	
                                                      US$

                                                    	 
      
	 
      	 
      	 
      
	
                                                      Conversion
      Price per share:

                                                    	
                                                      US$

                                                    	 
      
	 
      	 
      	 
      
	
                                                      Number
      of shares of Common Stock to be issued:

                                                    	 
      
	 
      	 
      
	
                                                      Please
      issue the shares of Common Stock in the following name and to the
      following address:

                                                    	 
      
	 
      	 
      
	
                                                      Issue
      to:

                                                    	 
      
	 
      	 
      
	
                                                      Authorized
      Signature:

                                                    	 
      
	 
      	 
      
	
                                                      Name:

                                                    	 
      
	 
      	 
      
	
                                                      Title:

                                                    	 
      
	 
      	 
      
	
                                                      Phone
      Number:

                                                    	 
      
	 
      	 
      
	
                                                      Broker
      DTC Participant Code:

                                                    	 
      
	 
      	 
      
	
                                                      Account
      Number:

                                                    	 
      

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
         

      

      
        A-1

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