Document:

Exhibit
10.1

EXHIBIT
A: PRODUCT AND SERVICES ORDER

Pursuant to the Master Terms and Conditions dated March 16,
2005

This Product and Services Order (“PSO”)
No. 5 is entered into as of this ____ day of April, 2006 by and between Bally’s
Park Place, Inc. a New Jersey corporation dba 
Bally’s Atlantic City, hereby referred to as Bally’s Atlantic City (“Client”)
and Watchit Media USA, Inc.  (“Watchit Media”) and is deemed to be
incorporated into that certain Master Terms and Conditions dated as of the 16th day of March, 2005 by
and between Harrah’s Operating Company, Inc. and Watchit Media  (the “Master Agreement”).  Any terms used herein but not defined shall
have the meaning ascribed to such term in the Master Agreement.

1.             Name and Description of Project:

Watchit Media will provide Client with an
integrated gaming and promotional media management and display solution for
Bally’s private video network.  This
solution is focused on scheduling/triggering internal media streams and
environmental effects anywhere within Client’s casino entertainment
facilities.  The purpose of Watchit Media’s
initiative is to:

·                  Target
identified profiled customers with specific ads;

·                  Increase the
number of Total Rewards members;

·                  Cross
promote Client’s properties;

·                  Create
dynamic motion media that is consistent with Client’s identity and messaging to
preserve brand integrity; and,

·                  Provide a
more lively and dynamic environment.

Each of these factors will reinforce the
Client’s brand, highlight Client’s reputation as the most innovative and
progressive company in its industry, and increase Client’s revenue.

2.             Project Scope — Description of
services to be provided by Watchit Media

This PSO is for a Private Video Network
and Enterprise Media Management Program to be implemented within Bally’s
Atlantic City.  The Harrah’s Enterprise
Media Management and Display Deployment will be at Bally’s Atlantic City located at Park Place & Boardwalk,
Atlantic City, NJ 08401 and is powered by Watchit Media and CastNet Digital
Signage System.

Watchit Media will install the Software
and implement a CastNET digital signage system which includes the CastNET web
software, Scala Designer software, Scala Player Software, Scala Network Manager
Software (“Watchit Media System”).  A
description of the Watchit Media System is attached to this PSO as Appendix “A” and incorporated herein by
reference.  The Watchit Media System will
be integrated with Client’s assistance and with hardware provided by Client.

It is Watchit Media’s responsibility to
install and test the Watchit Media System. 
Watchit Media will follow all Harrah’s Policies and Procedures,
including all Change

 

Management procedures.  Watchit Media will also provide training for
Client’s users, administrators and Client’s IT support personnel.

The pricing, servers and peripheral
equipment (with equipment requirements) to be installed at Bally’s Atlantic
City in Atlantic City, NJ are listed
in the Appendix “B” and “C”
which are attached to this PSO and incorporated herein by reference.

Client will source the following
equipment:

·                  CastNET
Server — 1

·                  Designer
Workstation(s) — 0

·                  Player(s) —
9

·                  Backup
Players(s) — 0

·                  16 Port
10/100/1000 Network Switch for Pop-up Modules — 1

·                  Mondo
Monitoring Monitor (Dell 24” Wide Screen LCD) — 1

This PSO will also assume the currently
software licensing that the property currently has on site.  Bally’s Atlantic City has one player that is
functioning as a stand alone player. 
Annual maintenance for this player will began 30 days for from the
acceptance period as defined in Section 13 of this PSO.

Watchit Media will create media
templates, motion media for digital display, and ad spot rotation for the
casino/property common areas for Client. 
All media will be trafficked to the CastNET Media Management and Display
System.  Watchit Media will coordinate
the acquisition of assets with Company’s marketing personnel within Harrah’s
Operating Company, Inc. corporate office, local properties, HCN Studios, Tracy
Locke, and any other identified organization. 
Watchit Media will provide online previews in advance for Client’s
feedback and prior written acceptance prior to upload.

A total of 200 hours of content
development is allocated by Watchit Media for initial implementation.  Content development includes any pre or
post-production and can be allocated to video shooting at either property to
help fill the in room line up as needed. 
In the event that the Client’s actual hours used for initial content
creation are lower than the amount of hours defined in this PSO by more than
20% of the total amount of contracted hours, Watchit shall reimburse the
Client, any unused hours that are greater than 20% of contracted amount.  If the Clients uses less than the contracted
amount, but the unused amount does not exceed 20% of the contracted hours
outlined in this PSO, Watchit will hold (or bank) the unused hours for the
Client to use on any future production requests for up to 12 months from the
completion of the acceptance period defined in Section 13 of this PSO.

 2
 

 

3.             Purpose, Objectives, and Activities by Phase

·                  The ongoing
media planning production will commence at the beginning of this project and
will continue throughout duration of the PSO.

·                  The Watchit
Media Systems configuration, software installation and the testing will be done
by Watchit Media prior to delivery to the Client.

Such activities will be
done at Watchit Media’s strategic partner Alpha Video located in Minneapolis or
remotely at Client’s location prior to delivery to Client to insure that all
systems are fully prepped for deployment and have been adequately tested and
found to be reliable.

·                  Watchit
Media System Delivery and Setup On-Site

This will include
setting up systems on property and working with Client to make appropriate
network connections and joining each system to the Client’s domain.

·                  Watchit
Media System Testing On-Site

The Watchit Media
Systems will be tested with final content prior to launch to stress test the
system.

·                  Onsite
Training

Client’s users,
administrators, content managers and property IT will receive training on
system operation, management, troubleshooting and support services.

·                  Final
Delivery

The Watchit Media System
will be activated on the property with live content being distributed on the
Client’s plasma network.

4.             Description of Deliverables:

Watchit Media will deliver the following
deliverables:

·                  Installation
of server at the Bally’s
Atlantic City.

·                  Installation
of players at the Bally’s
Atlantic City.

·                  Watchit
Media System configuration including communication between servers and players
and user access across network.

·                  Populate new
servers with existing and new media content.

·                  Templates:
media, ads, and other content types. 
Content types are also known as media types or media components and are
defined as follows: any individual

 3
 

 

component
used to create an ad or ad template, such as a graphic, audio file, video file,
animation, image file, foreground, background, branding, logo, or other
similar/related item.

5.             Ownership of Work

All work performed for Client including
all Deliverables is defined as Client’s “Confidential Information” and Client’s
“Intellectual Property” in accordance with Section 7, Intellectual
Property and Section 12, Confidentiality of the Master Agreement.

All media templates, ads and Content
types created by Watchit Media must be pre-approved in writing by Client and
must air identical to what Client has created or pre-approved in writing.

6.             List of Assumptions

·                  The domain
profiles and account setup on domain will be accomplished using Client’s local
property IT.  Client’s personnel will be
available to setup the custom profile necessary to make sure that:

-                    Players can
auto-login into the domain

-                    Players do not
have any activities that will interrupt playback such as screen savers or virus
pop ups.  These types of activities will
need to be configured in the domain profiles for these systems.

-                    VNC (Virtual
Network Computing) will be utilized for remote viewing and maintenance of
players.

-                    CastNET
Server and Workstation can be setup on the domain

·                  The CastNET
Server will be configured with IIS running on port 80 and FTP running on port
21.  Web access will be required on all
Client’s personnel desktops that wish to utilize and access the web based
content management CastNET interface. 
FTP (File Transfer Protocol) access will be utilized between the server
and the players to distribute content updates and status reports.

·                  One fixed or
reserved DHCP IP (Dynamic Host Configuration Protocol Internet Protocol) will
be available for the CastNet Server and an appropriate DNS (Domain Name System)
name may be selected to make local property access to the server easier.  The players do not require fixed IP
addresses.  The PC naming conventions
will need to be available prior to configuration at Alpha Video for the CastNet
Server, workstation and all players.

·                  The scope of
work is based on information provided by Client to Watchit Media as set forth
in Section 2 of this PSO.

·                  Any changes
to the Project will be handled by a PCR in accordance with Appendix F of this
PSO.

 4
 

 

·                  It is
Watchit Media’s responsibility to make sure that Watchit Media’s employees and
subcontractors comply with network security and virus protection standards as
stated in Section 20 of the Master Agreement and Appendix G of this PSO, and incorporated
herein by reference.  All machines and
systems used by Watchit Media must have industry-standard and up-to-date virus
protection.  If Watchit Media’s machines
or systems are found to cause problems on the Client’s network, interfere with
network applications or violate network security, such machines will be
immediately disconnected.  Non-compliance
by Watchit Media, its employees or subcontractors with Client’s network
security or virus protection standards shall constitute a material breach of
the Master Agreement and this PSO.  A list of all Client’s prohibited
software and hardware is attached as Appendix G to this PSO and is incorporated
herein by reference.

·                  Client will
provide approved hardware, software, connectivity, accounts, user id’s, office
space, phone, fax and reprographic facilities for Watchit Media personnel at
Client location at Bally’s in Atlantic City, NJ.

·                  Client will
provide Watchit Media with access to 3rd-party tools
used by Client and their documentation for execution of the Project, such tools
and documentation being defined as Client’s Confidential Information in
accordance with Section 12 of the Master Agreement and subject to the
Confidentiality provision of Section 12 of the Master Agreement.

·                  Client will
provide access to Client building during office hours and if necessary, after
office hours, on week-ends and holidays.

·                  THIS PSO
ASSUMES NO ACCESS TO CLIENT’S PRODUCTION SYSTEMS.  If this changes, a PCR will be requested in
accordance with Appendix F of this PSO, and Watchit Media agrees to abide by
Client’s production access procedures.

·                  Watchit
Media is not responsible for cabling from Player PC to Clients Display.

·                  Shipping
costs for hardware and software are estimates and shall not exceed this amount
unless the Client requests expedited or special shipping instructions in
writing.  Actual shipping costs related
to the transporting product will be billed to the Client at actual costs.  If Client has preferred carrier and wishes
Watchit Media to direct bill the shipping costs, this will be specified in the
purchase order.

·                  The
management of virus software and Microsoft patches and updates will be the
responsibility of the Client for ongoing operations.

7.             Documentation
to be Produced by Watchit Media:

·                  The operational
manuals for users and administrators will be provided to Client in electronic
PDF format.  Watchit Media may provide to
Client customized operational manuals at no additional cost.

 5
 

 

·                  The overall
workflow block diagram for the property based on sample workflow and customized
for Client will be finalized and will show the contributing users, approvers,
approval process, content publishing, content distribution and playback.  This will be a representative layout at the
time of the final implementation, and is specific to the property.

·                  Technical
Summary documentation providing IT support related summary of all servers,
workstations and players involved in the CastNET system and their specific
pertinent information.

·                  Technical
support coverage contact numbers for the Watchit Media System.

8.             Documentation to be produced by
Client, if any

Day-to-Day support personnel contact information

Emergency after hours contact information

Remote Access guidelines

Client’s marketing plans, procedures and brand specifications as necessary to

perform its obligations under this PSO.

Client’s contact list of project stakeholders and marketing stakeholders,
subject

to the confidentiality provision of the Master Agreement

9.             Key Personnel Assigned for
Watchit Media:

·             Joshua
Hoffert — Account Project Manager

·             Alex Vinson —
Art Director, Content Creation

·             Eric Taitano
— Senior Designer, Content Creation

·             Erick Sturm —
Vice President, Media

·             Lance
Hutchinson — Technical Hardware/Software Specialist

·             Birgit
Davidson — IT Project Manager

·             Troy Seigert
— Technical Support Manager

·             Dan Rabin —
Installer/Trainer

·             John Scott —
Installer/Trainer

·             Robin
Bookout — Installer/Trainer

·             Kris
Berggren — System Engineer

·             Jeff
Carpenter — Systems Integrator

Once Watchit Media personnel are assigned
to this PSO, Watchit Media may not replace individual personnel without the
prior approval of Client.

10.          Project Schedule:

Start date:  April
25, 2006                    End Date:  November 30, 2006

Specific dates will be
assigned upon project commencement.

 6

 

	
  Phase

  	
   

  	
   

  	
   

  	
  Client or Watchit

  Media’s Responsibility

  	
   

  	
  Days

  Allotted

  
	
  Purchase Order Prepared

  	
   

  	
  Client

  	
   

  	
  4

  
	
  Software and
  Miscellaneous items ordered

  	
   

  	
  Joint

  	
   

  	
  1

  
	
  Equipment arrives at
  Alpha Video Minneapolis Office

  	
   

  	
  Client

  	
   

  	
  14

  
	
  Equipment is assembled
  and tested at Minneapolis Office

  	
   

  	
  Watchit
  Media

  	
   

  	
  5

  
	
  Final testing with
  initial configuration is completed

  	
   

  	
  Watchit
  Media

  	
   

  	
  4

  
	
  Equipment is shipped to
  local property

  	
   

  	
  Watchit
  Media

  	
   

  	
  1

  
	
  Equipment is received
  at local property

  	
   

  	
  Client

  	
   

  	
  5

  
	
  Technicians assemble
  and test equipment at local property

  	
   

  	
  Watchit
  Media

  	
   

  	
  6

  
	
  Technicians and local
  property IT get all systems onto Domain

  	
   

  	
  Joint

  	
   

  	
  3

  
	
  ·   Systems are tested on Customers Domain 

  	
   

  	
  Joint

  	
   

  	
  2

  
	
  ·   Updated Content is loaded onto Customers

  Systems onsite 

  	
   

  	
   

  	
   

  	
   

  
	
  ·   Network sniff test performed for final
  Certification

  	
   

  	
   

  	
   

  	
   

  
	
  ·   Users and administers and final workflow
  tweaks

  are updated onsite 

  	
   

  	
   

  	
   

  	
   

  
	
  ·   Testing of plasmas CAT5 VGA will be tested
  for

  sizing and playback quality through distribution

  system.

  	
   

  	
   

  	
   

  	
   

  
	
  ·   User Acceptance Testing to confirm all

  functionality and content specified by Client 

  	
   

  	
  Joint

  	
   

  	
  4

  
	
  ·   Systems are tested with updated content

  	
   

  	
  Joint

  	
   

  	
  2

  
	
  Final sign off on project by local operators

  	
   

  	
  Client

  	
   

  	
  1

  

 

11.          Tasks
to be Performed by Client

·                  Client will
purchase PCs directly from desired computer vendor meeting the requirements
outlined in Appendix C and shipped to Alpha Video’s Minneapolis location for
configuration and testing prior to delivery on property.  Watchit Media will have a minimum of one week
to configure and test the systems prior to shipment to the Client.

 7
 

 

·                  If spare PC’s
are desired to have in place to swap out for a player that has failed, Client
will acquire an appropriate spare desired computer vendor meeting the
requirements outlined in Appendix C system that can be used for this purpose.

·                  Client will
have the equipment room prepped for Watchit Media arrival including: network
drops for each PC; appropriate power for PC’s and associated equipment.

·                  Client will
ensure that the interconnect wiring between IT rooms related to CAT5
transmission systems will be in place prior to Watchit Media’s arrival.

·                  Client will
provide access to Watchit Media a mail server as well as a mail account and
password for the NetManager to provide email alerts of real time system
monitoring to Client’s IT staff.  An
additional mail account and password will be required for the CastNET system
for the email notification to be activated within CastNET.

·                  Any power
monitoring, conditioning or UPS equipment will be put in place by Client at its
discretion.  All Rack power, rails and
shelves required will be provided by Client.

12.          Status Reporting

Watchit Media will provide weekly status
reports, addressing the following areas:

·                  Overall
Project Status — highlighting activities performed
during the reporting period, activities planned for next reporting period,
schedule variances, variances in the financials of the project, hours actually
performed per phase vs. hours originally planned for same phase and staffing

·                  Issues —
escalation of project issues, obstacles

·                  Risks —
escalation and visibility into project risks, and mitigation strategies

·                  External
Project Dependencies — escalation and visibility into
external project dependencies and requirements

·                  Change Requests —
escalation of project change requests, requiring approval to change project
scope, timeline, and/or cost

·                  Milestones —
escalation and visibility into key project milestones

·                  Key
Performance Indicators (KPIs) — highlighting progress against phase exit
criteria and deliverable completion

13.          Acceptance Period

All acceptance criteria and warranties
set forth in Sections 4 and 15 of the Master Agreement apply as if fully set
forth herein.

	
  Description of Acceptance Criteria

  	
   

  	
   

  	
   

  	
  Watchit Media’s

  Responsibility

  	
   

  	
  Client sign off

  
	
  Installation of players

  	
   

  	
  Yes

  	
   

  	
  Yes

  
	
  Watchit Media System

  	
   

  	
  Yes

  	
   

  	
  Yes

  
	
  Installation of MPEG
  Players

  	
   

  	
  Yes

  	
   

  	
  Yes

  
	
  Templates: media, ads, and other content types

  	
   

  	
  Yes

  	
   

  	
  Yes

  

 

 8
 

14.          System Maintenance and Content

Upon successful completion of the
Acceptance Period, and subject to section 6 of the Master Agreement, the Client
agrees to pay a total yearly license, maintenance, and support fee in equal
monthly installments for Bally’s Atlantic City of two thousand thirty dollars
($2,030) per month if paired with a reoccurring monthly content creation.  This fee includes the assumption of one (1)
additional player that is currently on site at Bally’s Atlantic City, this
player currently functions as a stand alone player.  If the Property opts out of the monthly
reoccurring content creation, the Properties monthly payments for annual
maintenance fees will be three thousand four hundred five dollars
($3,405).  The first months maintenance
and support fee will billed at the completion of the acceptance period and
recurring monthly maintenance will be billed in the consecutive months.  Watchit Media’s maintenance and support
program is outlined in Appendix D
which is attached to this PSO and incorporated herein by reference, and Section
14 of the Master Agreement and includes hardware repair or exchange, phone
support for any issue or system inquiry.

In addition, the Client will contract for
ten (10) hours of content and template creation services in the amount of two
thousand seven hundred dollars ($2,700.00) per month.  Total hour usage will be assessed quarterly
to determine appropriate hour requirements. 
Unused hours rollover to the next month and accrue for up to 12 months
from date of accrual.  A grace level of
service will be extended not to exceed 20% of the total accumulated hours per
quarter.  Additional hours in excess of
the 20% grace service will be billed quarterly, at the option of Watchit Media,
at the rate of one hundred eighty dollars ($180.00) per hour.

Monthly content will be trafficked to the
Clients property by means defined in the Master Terms and Conditions.  If Client chooses alternate delivery means,
the Client shall (i) reimburse Watchit for all expenses incurred by Watchit in
connection with performing these alternative Services, including reasonable
costs associated with special deliveries of equipment, content or other
materials as requested by Client, and (ii) pay any applicable taxes related to
the alternative Services.

The term of this Agreement shall be for
one (1) year from the conclusion of the acceptance period.  Thereafter, the Content and Template Creation
Services and the Maintenance and
Support shall be automatically renewed for successive one (1) year periods,
unless either party provides written notice to the other party of the intent
not to renew this Agreement.  Written
notice must be given at least thirty days prior to the expiration of the
Initial Term or current renewal term.

At any time either Watchit or the Client
may modify or amend this agreement in a written Project Change Request as
identified in Appendix F of this PSO. 
Project Change Request will specify any additions to, or deletions from,
the Services specified in this Agreement and any adjustment in the fees
identified herein by reason of the changes. 
Adjustments in fees in will be made by good faith negotiation of both
parties on the 

 9
 

basis of their respective estimate(s) of
increases or decreases in the cost, required resources, and materials of the
work due to the changes.

15.          Subcontractors/Portion of the work
subcontracted

None

16.          Client’s authorized representative to
approve Project Change Requests (PCRs) in accordance with Appendix F of this
PSO is: Mike Effner, Director of IT Development.

17.          Payment Schedule

The fixed or not to exceed total price
contract for the Products and Services to be performed by Watchit Media under
this PSO is three hundred sixty seven thousand nine hundred forty five dollars
($367,945.00), which shall be paid on the following schedule:

	
  Milestone

  	
   

  	
   

  	
   

  	
  Percentage

  	
   

  	
  Amount

  	
   

  
	
  Confirmation of order
  of hardware, software, and services

  	
   

  	
  25

  	
  %

  	
  $

  	
  85,673.75

  	
   

  
	
  Installation of
  hardware/software components

  	
   

  	
  50

  	
  %

  	
  $

  	
  171,347.50

  	
   

  
	
  Acceptance by Client

  	
   

  	
  25

  	
  %

  	
  $

  	
  85,673.75

  	
   

  
	
  Travel & Expenses
  (Actual billed, Not to Exceed)

  	
   

  	
   

  	
   

  	
  $

  	
  20,250.00

  	
   

  
	
  Shipping (Actual billed, Not to Exceed)

  	
   

  	
   

  	
   

  	
  $

  	
  5,000.00

  	
   

  

 

Work is scheduled to begin on April 25,
2006 and terminate by October 30, 2006 dependent on the Client site being ready
for the installation.

Not-to-exceed total fee means that the
charges for the work done under this PSO cannot exceed the amount noted as the “not-to-exceed”
fee.  Any additional hours required to
complete the initial scope of work shall be Watchit Media’s exclusive
responsibility.

Invoices would be raised by the Watchit
Media at the end of each month for the Services for the month and would be due
for payment once the invoice is raised.

Reimbursable expenses incurred will be
reimbursed in accordance with Section 11 of the Master Agreement.  All Reimbursable Expenses are exclusively
limited to the list of Reimbursable Expenses set forth in Appendix E to this
PSO, which is incorporated herein by reference. 
During the performance of this PSO, Watchit Media shall limit their
Reimbursable Expenses to no more than 15% of the value of the fixed or not-to-exceed
total fee for the services provided hereunder.

Client can terminate this PSO at any time
with ten (10) business day’s prior written notice to Watchit Media.  In the event of such termination, Client
shall pay Watchit 

 10
 

Media the daily rate per person for each
day up to the date of termination, in addition to all pre-approved Reimbursable
Expenses.

All project invoices (where milestones
are set) shall be sent to:

Bally’s Atlantic City

Attn:  Bill Borrenstein

Park Place & Boardwalk

Atlantic City, NJ  08401

Ongoing monthly content invoices shall be
sent to:

Bally’s Atlantic City

Attn: Colleen Cornell

Park Place & Boardwalk

Atlantic City, NJ  08401

All payments shall
be sent to Watchit Media’s address at:

Watchit
Media

4046 West Highway 7

PO Box 516

Montevideo, MN 56265

 11
 

The parties agree
that the complete agreement between the parties consists of 1) this Product and
Services Order and 2) the Master Agreement.

Agreed to:

	
  Bally’s Park Place, Inc.

  a New Jersey corporation dba

  Bally’s Atlantic City

  	
   

  	
  

  Watchit Media USA, Inc.

  
	
   

  	
   

  	
   

  
	
  By: 

  	
   

  	
   

  	
  By: 

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Name: 

  	
   

  	
   

  	
  Name: 

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title: 

  	
   

  	
   

  	
  Title: 

  	
   

  
							

 

 12

 

APPENDIX A

WATCHIT MEDIA
PRODUCT & SERVICES

Manageit

Manageit, an Enterprise Media Management
System, is a modular server based system that uses Scala technology as the
engine, and CastNET for creating, scheduling, and publishing ads.  he system consists of servers, players, the
Net Manager, and the Creator module. Completely scalable, Manageit is accessed
using any web browser on any computer; user security authorization is required
for access.  Once a user is logged into
the system they may access a very simple interface to perform any activity for
which they have been granted permission. Activities are functions of the system
as well as rights or permissions granted to each user. They are as follows:

·                  Create — Users create ads based on predefined
templates, combining video, text, graphics, and dynamic information from
databases.

·                  Review — Authorized users can view ads
submitted for approval, or ads that are being created.

·                  Approve — Ads are approved and released for
scheduling or rejected for revisions and re-submission.

·                  Schedule — Approved ads are scheduled to play on
predetermined days and times, and may be scheduled up to a year in advance.

·                  Publish — Once an ad is scheduled it will be
sent to the appropriate player(s) when it is published.

The Manageit infrastructure utilizes the
TCP/IP protocol over an existing CAT5 network. 
layers are modified PC’s specifically designed for the storage and
playback of motion media, and are enabled to send a program stream to any type
of display, including plasma, LCD, outdoor LED, projectors, and in room
television.  Players receive published
ads from the server where they are stored to be inserted into play lists.

Manageit allows assets such as video,
graphics, etc. to be centrally located and available to all Clients’ properties’
authorized users.  These assets can be
monitored or regulated by the corporate office to assure they align with the
company brand and retain consistency of message.  At the property level these assets can be
used to create messages for profiled guests, utilizing proprietary programming,
to target specific property sectors for cross promotion, entertainment, and
gaming.

NetManager

NetManager is the module for configuring
network actions in Manageit; Bandwidth
can be regulated and network rules can be activated to assure effective media
transport.

 A-1
 

 

Creator

Creator allows users to create ads from
pre-created templates, following a creation wizard ads are created by answering
questions, selecting media files and typing pre-formatted text.  Ad’s can be created quickly while the
template assures that the style is consistent with the Client’s brand.

Programming

Watchit Media, Inc. is a leader in
creating, producing and presenting high-impact dynamic digital
communication.  We have 12 years experience
in the creation proprietary television programming and management of Private
Video NetworksTM (Narrowcasting) to the gaming and hospitality industry.  We create, produce and present compelling
dynamic digital video communications for public displays and in-room
television.

 A-2

APPENDIX
C

Manageit System Hardware Configurations

Player System OS:

Windows 2000 or XP
(please note if you have service pack restrictions up front - otherwise we
install latest available versions)

·                  Processor:  Pentium 4 2.8Ghz or faster Hyper Threaded processor  Memory: 
256MB or better

·                  Video
Card:  NVideo GForce 5200 AGP chip set or
Intel 865G Extreme 2 AGP Chipset recommended 64MB Video Ram or greater

·                  Disk
Space:  20GB or better 5400+ RPM

·                  These can be
provided as Turnkey small form factor PC’s - we can also provide on a Compaq,
HP or Dell configuration

·                  If Antivirus
software will be installed all popups will be deactivated as they interfere
with the playback software.

·                  They
communicate to the server via FTP.

 

Creator and NetManager System OS:

Windows 2000 or XP (please note if you have service pack restrictions
up front - otherwise we install latest available versions)

·                  Processor:  Pentium 4 2.8Ghz or faster Hyper Threaded
processor Memory:  256MB or better

·                  Video
Card:  NVideo GForce 5200 AGP chip set or
Intel 865G Extreme 2 AGP chipset recommended 64MB video RAM or greater.

·                  Disk
Space:  20GB or better 5400+ RPM Boot
Drive and Mapped Server D Drive

·                  These can be
provided as Turnkey PC’s - we can also provide on a Compaq, HP or Dell
configuration

·                  If Antivirus
software will be installed all pop ups will be deactivated as they interfere
with the playback software.  These
systems need to be able to map a drive from the Server.

Server System OS:

Windows 2000 Server or 2003 Server (please note if you have service
pack restrictions up front - otherwise we install latest available versions)

·                  Processor:  Single Pentium 4 2.8Ghz or faster Hyper
Threaded processor or Dual Xeon 3Ghz+ processor - grows with size of
deployments

·                  Memory:  1GB or better Video Card:  Most any onboard video that can provide 32bit
1024x768 resolution preferred

·                  Disk
Space:  Deployment size varies storage
from 200 GB to 1TB based on content. 
Typically Raid 5 with Tape backup solution

·                  These are
provided as Turnkey servers - we can also provide on a Compaq, HP or Dell
configuration

·                  If Antivirus
software will be installed, all pop ups will be deactivated as they interfere
with the playback software

 

 C-1
 

 

·                  The systems
communicate primarily via FTP protocol using a FTP server and IIS Web Server on
the Server system.  The D drive from the
server will need to be designated as the D drive on the Creator system.

·                  Anti-virus
software is to be specified by client, so we can add the cost to the proposal
and install on server(s).

·                  A secure VPN
or constant on remote access environment is highly recommended for support
purposes so remote troubleshooting can be provided.

 C-2

 

Appendix
E

Reimbursable
Expenses

Records of all costs and Reimbursable
Expenses incurred in connection with the Services performed under the terms and
conditions of this Agreement shall be kept in accordance with generally
accepted accounting principles and shall be available to Harrah’s pursuant to
the terms of Section “Audit” hereof. 
Copies thereof shall be made and presented to Harrah’s as and when
reasonably requested at no cost to Harrah’s.

All Reimbursable Expenses are exclusively
limited to the list of Reimbursable Expenses set forth in Exhibit “B”, which is
attached to this Agreement and incorporated herein by reference.  All Reimbursable Expenses shall be incurred
in accordance with the following policy. 
Reimbursable Expenses shall only be at actual costs and only in
connection with out-of-town travel of more than one hundred (100) miles from
Watchit Media’s location.  Authorized
travel expenses shall be billed listing the employee’s name, purpose of the
trip and the dates traveled.  Written
authorization shall be obtained in advance from Harrah’s.  Copies of all receipts, hotel bills, car rental receipts and like
documentation for other items will be provided with the billing.  Airfare will be at coach airfare.  Per diem expenses for food and hotel shall be
at Harrah’s place of business, if applicable and/or not to exceed Federal
Government per diem daily allowable rates for the City and State traveled into
without the express written advance permission of Harrah’s which can be given
by fax or e-mail.  It is Watchit Media’s
responsibility to submit only the Reimbursable Expenses.  Watchit Media’s invoices for Reimbursable
Expenses must be received by Harrah’s within forty-five (45) days of the date
the expense(s) was/were incurred or Harrah’s will no longer have to honor those
invoices.

Watchit Media is responsible for shipping
all products on Harrah’s designated shipper, as set forth herein.  Non-compliance with this provision will
result in a non-payment of Watchit Media’s freight bill to Watchit Media’s
company including document handling fees to process Watchit Media’s invoice for
payment. Risk of loss is on the carrier from time of pickup to Harrah’s loading
dock.  Harrah’s shall not pay any charges
for handling and/or packaging.  Watchit
Media should package material appropriately for shipping.  This provision shall not apply to any
tribally owned Harrah’s managed property. 
Shipments will be F.O.B. Origin, 3rd party billing option.  FedEx Ground and FedEx Express should be used
for all inbound packages weighting less than 150 lbs. (total shipment weight of
less than 300 lbs.) and FedEx Freight (should be sent “freight collect” unless
otherwise instructed) for all shipments over 300 lbs.  At no time will Watchit Media ship on FedEx
Express without prior written approval from Harrah’s.  All shipping documents require a purchase
order number on the bill of lading.

List of Reimbursable Expenses

·                  Standard
rooms

·                  Use of a
rental car.  Intermediate class cars or
smaller must be booked unless any of the following conditions exist:

 E-1
 

 

ü              Four or more
passengers will be using the vehicle;

ü              Business materials
or equipment require a larger vehicle;

ü              An intermediate car
is not available;

ü              For pre-approved
medical reasons.

·                  Reimburse
reasonable parking fees and tolls.

·                  Travelers
will be reimbursed for the cost of taxis (NO Limo’s) to and from places of
business, hotel, airports or railroad stations in connection with business
activities if rental car usage is not also being paid for by Harrah’s.

·                  Domestic air
travel must be in Economy class and, where possible, ticketed at least fourteen
(14) days in advance.

·                  Meal
expenses incurred by the traveler when dining alone during out-of-town business
not to exceed the Federal Government per diem daily rates for the City and
State traveled into.

·                  Air freight
via Federal Express for business purposes.

·                  Personal car
mileage at the IRS rate of 44.5 cents per mile for business miles driven.

Non-Reimbursable Expenses

·                  Additional
travel insurance coverage

·                  Airline club
memberships

·                  Airphone
usage

·                  Air travel
upgrades

·                  Auto repairs

·                  Barber and
hair salon fees

·                  Car washes
or detailing

·                  Cell Phone
charges

·                  Clothing

·                  Donated
items or gifts

·                  Excess
baggage charges, except for business materials or equipment

·                  Expenses for
travel companions/family members

·                  Expenses
relating to vacation or personal days incurred before, during, or after a
business trip

·                  Fines and
penalties imposed for the violation of traffic laws while operating a personal
or rental car.

·                  Forfeiture
fees for hotel rooms and/or rental cars unless there is sufficient proof that
the billing is in error.

·                  Frequent
flyer tickets or upgrades

·                  Hotel room
upgrades

·                  Laundry or
valet services

·                  Lost or
stolen personal funds or property

·                  Lost baggage

·                  Magazines,
books, newspapers

·                  Medical
expenses

·                  Mini-bar
refreshments unless as a substitute for a meal

 E-2
 

 

·                  “No-show”
charges for hotel or car rental

·                  Optional
travel or baggage insurance

·                  Parking
tickets or traffic violation fines

·                  Personal
accident insurance

·                  Personal
automobile insurance.

·                  Personal
entertainment, including sports events and theater

·                  Personal
phone calls

·                  Personal
property insurance

·                  Personal
telegrams/telexes

·                  Pet care or
kennel fees

·                  Rental car
optional insurance

·                  Rental car
phones

·                  Rental car
upgrades

·                  Repairs due
to accidents

·                  Repairs to
personal vehicles

·                  Spa, sauna,
massage fees

·                  Shoe shine
expense

·                  Souvenirs or
personal gifts

·                  Theft of
personal property from room or rental car

·                  Towing
charges

·                  Travelers
check fees

·                  Currency
conversion fees

·                  Laundry/dry
cleaning/suit pressing for trips exceeding five consecutive nights

·                  Any other
expense(s) not specifically defined as “Reimbursable Expenses” in this Exhibit.

 E-3

 

Appendix
F

Project
Change Request (“PCR”) Procedure

The Client without invalidating the
Product and Services Order (PSO), may order extra Services or make changes
within the general scope of the work by altering, adding to or deducting from
the Services which may result in a change to the estimated price or completion
date by both parties executing a PCR in the form attached as Exhibit A to this
PSO. All Services performed pursuant to a valid PCR shall be performed under
the conditions of the PSO. The PCR will describe the change, the rationale for
the change, and the effect the change will have on the PSO.

(b) PCR
Procedure.   Upon receipt of a request from the Client, Watchit
Media shall furnish to the Client a statement setting forth in detail the
proposal of Watchit Media for performing the extra Services or changes and the
effect of the extra Services or changes, if any, in the not-to-exceed price and
the completion date attributable to the extra Services or changes.  If an authorized representative of Client
approves in writing the proposal of Watchit Media, the parties shall execute a
PCR and the completion date may be adjusted accordingly.

 F-1

 

Appendix G

HARRAH’S OPERATING COMPANY, INC.  SECURITY POLICY

Pursuant to the Product and Service Order dated _____  __, 2006

1.1.                             Safeguarding Harrah’s Information.  Harrah’s guidelines for safeguarding its
information include measures that must be taken when a supplier, vendor or
Watchit Media (“Supplier”) maintains processes or otherwise has access to
Harrah’s Information by providing services directly to our company.  Harrah’s Information is defined as all
information provided by Harrah’s to the Supplier or any Harrah’s information
accessible by the Supplier, including but not limited to, Harrah’s proprietary
information, Harrah’s confidential information, Harrah’s customer information
and regulatory controlled information. Harrah’s information handling practices
comply with the existing Federal and State laws and create a continuum of
effective privacy protections for our corporation and customers.  Harrah’s also requires Suppliers doing
business with Harrah’s to uphold Harrah’s standards for the safeguarding of
Harrah’s Information which include but is not limited to Harrah’s corporate and
customer information.  Accordingly,
concerning all Supplier relationships, Supplier’s shall provide documentation
of the following:

1.1.1.                    Suppliers
conduct appropriate privacy due diligence to review the measures used to
protect customer information.  Where
applicable, privacy due diligence is performed and documentation of it is
provided prior to the selection of a Supplier.

1.1.2.                    Suppliers will
implement appropriate measures designed to safeguard and maintain the
confidentiality of Harrah’s Information. 
Supplier’s obligations to do so will be confirmed through the following
provisions which will be included in any agreement between Supplier and Harrah’s
(“Agreement”):

1.1.2.1.                           Information Security Review.  Harrah’s reserves the right to perform
information security reviews on any systems or applications used by Supplier to
provide services to Harrah’s.  The
security reviews can include physical inspection, external scan, code review,
process reviews, and reviews of system configurations(“Security Reviews”).  The Security Reviews shall be conducted at
Harrah’s discretion, by Harrah’s or its designee (who shall be a reputable
security firm), and at Harrah’s expense unless provided otherwise.  Supplier shall grant permission to Harrah’s
to perform the Security Reviews.  Harrah’s
actions or results from any Security Reviews shall be the sole property of
Harrah’s and may not be utilized or relied on by Supplier in any way, except as
set forth by Harrah’s in performance of services hereunder.  Should any Security Review result in the
discovery of material security risks to the network used by Supplier to perform
services for Harrah’s, Supplier shall be solely responsible for the 

 G-1
 

 

cost of the Security Reviews. Harrah’s shall
immediately notify Supplier of such risks and Supplier shall respond to Harrah’s
in writing within three days with Supplier’s plan to take reasonable measures
to promptly correct, repair, modify the said network or application to
effectively eliminate the risk at no cost to Harrah’s.

1.1.2.2.                           Information Security Standards.  Harrah’s shall provide to Supplier its
Information Security Standards that define information security controls and
guidelines currently in place.  The
Supplier shall, in the performance by Supplier of services under the Agreement,
comply with all commercially reasonable standards within thirty days of receipt
of same, unless the parties agree otherwise. 
At any time during the term of the Agreement, and upon notice to
Supplier, Harrah’s may have a Security Review and an architectural design
review of the facilities and applications used by Supplier to perform services
for Harrah’s, such a review will be performed by either Harrah’s or a third
party, at Harrah’s discretion. If a security flaw is discovered, Harrah’s shall
give immediate notice of such flaw to Supplier and Supplier shall have five
business days to formulate a plan to cure such flaw, unless the parties agree
to a longer period of time for such cure. 
Unless otherwise agreed to by the parties, during the term of the
Agreement, Supplier shall have thirty days from receipt of notice to comply
with any change in the Information Security Standards.

1.1.2.3.                           Electronic Incident Reporting. 
Supplier shall report to Harrah’s all known or suspected Electronic
Incidents (as defined below).  If an
Electronic Incident occurs Supplier shall immediately notify Harrah’s IT
Security and provide the following information: nature and impact of the
electronic incident; actions already taken by Supplier; Suppliers assessment of
immediate risk; corrective measures to be taken, evaluation of alternatives,
and next steps.  Supplier shall continue
to provide appropriate status reports to Harrah’s regarding the resolution of
the electronic incidents.  Harrah’s may
require that Supplier’s services be suspended, connectivity with Supplier be
terminated or other appropriate action be taken pending such resolution.

1.1.2.4.                           Electronic Incident.  Electronic Incident means
any unauthorized action by a known or unknown person which, whether
successfully completed, attempted or threatened, should be reasonably
considered one of the following with regard to Harrah’s site, Harrah’s
technology, Harrah’s systems or services, Supplier’s systems, technology or
deliverables provided to Harrah’s: an attack, penetration, denial of service,
disclosure of 

 G-2
 

 

Harrah’s Information which includes but is not limited
to Harrah’s confidential information or customer information, misuse of system
access, unauthorized access or intrusion (hacking), virus intrusion, scan of
Harrah’s or Supplier’s systems or networks, or any other activity that could
affect Harrah’s systems or data.  For
purposes of this definition, “Supplier’s systems’” shall include the systems,
network technology, content or web sites of third party vendors used by
Supplier for the provision of Supplier’s services to Harrah’s.

1.1.2.5.                           Supplier Monitoring.  At Harrah’s discretion, Harrah’s shall
monitor Suppliers to ensure that they continue to meet obligations pertaining
to safeguarding Harrah’s Information. 
Not more than once per year throughout the term of the Agreement, Harrah’s
may require Supplier to:

1.1.2.6.                           Complete
Service Provider Information Security Questionnaire

1.1.2.7.                           Provide
documentation of a recently completed security audit that measures information
security controls and guidelines currently in place.

1.1.2.8.                           Permit
Harrah’s to perform site visit(s)

1.1.2.9.                           Permit
Harrah’s to perform Security Review

 G-3

 

Appendix
H

LIST OF PROHIBITED
SOFTWARE & HARDWARE

Pursuant to the Product and Services Order dated _____ __,
2006

These items may exist on a
Watchit Media’s laptop, but their use in Client’s network environment is
strictly prohibited.

•                 Any type of
internet messaging, chat, weather, stock tickers, streaming media

•                 No jazz drives,
zip drives, memory drives, or RW CD/DVD

•                 No Server OS
installed on PC

•                 No virus
protection other than Harrah’s standard, which is Norton

•                 No modems

These
prohibited items may NOT even exist on a Watchit Media’s laptop and their use
in Client’s network environment is strictly prohibited.

•                Any Remote Control
software, such as PC Anywhere, other than Windows Terminal Server Client or VNC

•                No “hacker tools,”
keystroke loggers, password capture, or other systems analysis software

•                No sniffing or
network discover or analysis related tools

•                No Peer to Peer
communication software such as KaZaA, BadBlue, DirectConnect, CuteMX, Napster,
Scour, HotComm, or Blubster, etc... that could be used by someone to take
control of another person’s computer

 H-1

 

Exhibit A

Pursuant to Appendix F

 

	
  Brief Description and reason for the Change
  Order:

  	
   

  	
   

  	
   

  	
  Request #:

  	
   

  	
   

  
	
  Project Release:

  	
   

  	
   

  	
   

  	
  Priority:

  	
   

  	
   

  
	
  Phase:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  REQUEST
  DEFINITION

  
	
  Initiator:

  	
   

  	
   

  	
   

  	
  Date Opened:

  	
   

  	
   

  
	
  Detailed Description:

  	
   

  	
  1.

  	
   

  	
   

  	
   

  	
   

  
																			

 

Project
Change Request (PCR) #        

This Project Change Request No. __ is
entered into by and between Harrah’s Operating Company, Inc. (“Company”) and
_________ (“Watchit Media”) and is deemed to be incorporated into the Statement
of Work dated ____, 200_ and that certain Master Services Agreement dated as of
the __ day of ____, 200_ by and between Company and Watchit Media (the “Master
Agreement’).  Any terms used herein but
not defined shall have the meaning ascribed to such term in the Master
Agreement.

1.             Description of Change Order and Responsibilities of
Parties:

	
  Additional Documentation Attached:

  	
   

  	
   

  	
  Date Needed:

  	
   

  

 

2.             Revised Deliverables:

	
  Deliverable Type

  	
   

  	
  Summary

  	
   

  	
  Estimated Date

  	
   

  	
  Estimated Hours

  
	
   

  	
   

  	
  •

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •

  	
   

  	
   

  	
   

  	
   

  

 

 Exh. A-1
 

 

 

The Deliverables are defined as
Company’s Confidential Information and Company’s Intellectual Property in
accordance with the Master Agreement.

3.             Work Statement Costs:

	
  Original Fixed Fee:

  	
   

  	
   

  

 

	
  Change Order Amount:

  	
   

  	
   

  

 

	
  Total Not to Exceed with Revised Work Statement
  Costs:

  	
   

  	
   

  

 

4.             Revised Milestones and Payment Schedule:

	
  Milestone #

  	
   

  	
  Milestone

  	
   

  	
  Estimated date

  relative to Start Date

  	
   

  	
  Payment Due

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

The parties agree that the complete
agreement between the parties consists of 1) this Project Change Request; 2)
the Statement of Work referenced above and 3) the Master Services Agreement.

For Harrah’s Operating Company, Inc.

	
  Name

  	
   

  	
   

  	
  Date

  	
   

  	
   

  	
  Signed

  	
   

  

 

For Watchit Media:

	
  Name

  	
   

  	
   

  	
  Date

  	
   

  	
   

  	
  Signed

  	
   

  

 

 Exh. A-2Exhibit 10.2

EXHIBIT A: PRODUCT AND SERVICES ORDER

Pursuant
to the Master Terms and Conditions dated March 16, 2005

This
Product and Services Order (“PSO”) No.  7
is entered into as of this        day of             ,
2006 by and between Atlantic City Showboat (“Client”) t/a Showboat Casino Hotel
and Watchit Media USA, Inc. (“Watchit
Media”) and is deemed to be incorporated into that certain Master Terms and
Conditions dated as of the 16 day of March, 2005 by and between Harrah’s
Operating Company, Inc.  and Watchit
Media  (the “Master Agreement’).  Any terms used herein but not defined shall
have the meaning ascribed to uch term in the Master Agreement.

 

1.           Name
and Description of Project:

Watchit Media will provide Client with an
integrated gaming and promotional media management and display solution for
Showboat private video network.  This
solution is focused on scheduling/triggering internal media streams and
environmental effects anywhere within Client’s casino entertainment
facilities.  The purpose of Watchit Media’s
initiative is to:

·                                          Increase
communication for the Second Chance to Win Program;

·                                          Target
identified profiled customers with specific ads;

·                                          Increase the
number of Total Rewards members;

·                                          Cross
promote Client’s properties;

·                                          Create
dynamic motion media that is consistent with Client’s identity and messaging to
preserve brand integrity; and,

·                                          Provide a
more lively and dynamic environment.

 

Each
of these factors will reinforce the Client’s brand, highlight Client’s
reputation as the most innovative and progressive company in its industry, and
increase Client’s revenue.

 

2.           Project
Scope—Description of services to be provided by Watchit Media

This
PSO is for a Private Video Network and Enterprise Media Management Program to
be implemented within Showboat Atlantic City. 
The Harrah’s Enterprise Media Management and Display Deployment will be
at Showboat Atlantic City located
at 801 Boardwalk Avenue,  Atlantic City,
NJ 08401 and is powered by Watchit Media and CastNet Digital Signage System.

 

Watchit
Media will install the Software and implement a CastNET digital signage system
which includes the CastNET web software, Scala Designer software, Scala Player
Software, Scala Network Manager Software (“Watchit Media System”).  A description of the Watchit Media System is
attached to this PSO as Appendix “A”
and incorporated herein by reference. 
The Watchit Media System will be integrated with Client’s assistance and
with hardware provided by Client.

 

It
is Watchit Media’s responsibility to install and test the Watchit Media
System.  Watchit Media will follow all
Harrah’s Policies and Procedures, including all Change

 

 1
 

 

 

Management
procedures.  Watchit Media will also
provide training for Client’s users, administrators and Client’s IT support
personnel.

 

The
pricing, servers and peripheral equipment (with equipment requirements) to be
installed at Showboat Atlantic City in Atlantic City, NJ are listed in the
Appendix “B” and “C” which are attached to this PSO and incorporated herein by reference.

 

Client will source the following
equipment:

·                                          CastNET
Server—0

·                                          Designer
Workstation(s)—0

·                                          Player(s)—6
(2 new players and 4 replacement players)

·                                          Backup
Players(s)—0

·                                          Patch Bays—2

·                                          Cable Tuners—2

·                                          16 Port
10/100/1000 Network Switch for Pop-up Modules - 1

·                                          Mondo
Monitoring Monitor (recommended Dell 20” Wide Screen LCD) - 1

This
PSO will also assume the current software licensing that the property currently
has on site.  Annual maintenance will be
billed in pursuant to Section 14 of this PSO.

 

Watchit
Media will create media templates, motion media for digital display, and ad
spot rotation for the casino/property common areas for Client.  All media will be trafficked to the CastNET
Media Management and Display System. 
Watchit Media will coordinate the acquisition of assets with Company’s
marketing personnel within Harrah’s Operating Company, Inc.  corporate office, local properties, HCN
Studios, Tracy Locke, and any other identified organization.  Watchit Media will provide online previews in
advance for Client’s feedback and prior written acceptance prior to upload.

 

A total of 80 hours of content
development is allocated by Watchit Media for initial implementation.  Content development includes any pre or
post-production and can be allocated to video shooting at either property to
help fill the in room line up as needed. 
In the event that the Client’s actual hours used for initial content
creation are lower than the amount of hours defined in this PSO by more than
20% of the total amount of contracted hours, Watchit shall reimburse the
Client, any unused hours that are greater than 20% of contracted amount.  If the Clients uses less than the contracted
amount, but the unused amount does not exceed 20% of the contracted hours
outlined in this PSO, Watchit will hold (or bank) the unused hours for the
Client to use on any future production requests for up to 12 months from the
completion of the acceptance period defined in Section 13 of this PSO.

 2
 

 

 

3.           Purpose,
Objectives, and Activities by Phase

·                                          The ongoing
media planning production will commence at the beginning of this project and
will continue throughout duration of the PSO.

·                                          The Watchit
Media Systems configuration, software installation and the testing will be done
by Watchit Media prior to delivery to the Client.

Such activities will be
done at Watchit Media’s strategic partner Alpha Video located in Minneapolis or
remotely at Client’s location prior to delivery to Client to insure that all
systems are fully prepped for deployment and have been adequately tested and
found to be reliable.

·                                          Watchit
Media System Delivery and Setup On-Site

This will include
setting up systems on property and working with Client to make appropriate
network connections and joining each system to the Client’s domain.

·                                          Watchit
Media System Testing On-Site

The Watchit Media
Systems will be tested with final content prior to launch to stress test the
system.

·                                          Onsite
Training

Client’s users,
administrators, content managers and property IT will receive training on
system operation, management, troubleshooting and support services.

·                                          Final
Delivery

The Watchit Media System
will be activated on the property with live content being distributed on the
Client’s plasma network.

4.           Description
of Deliverables:

Watchit Media will deliver the following
deliverables:

·                                          Upgrade
current CastNET server licensing at Showboat Atlantic City.

·                                          Upgrade
current NetManager software licensing at Showboat Atlantic City.

·                                          Installation
additional players at the Showboat Atlantic City.

·                                          Convert
current player PC from a larger form factor to a smaller form factor.

·                                          Watchit
Media System configuration including communication between servers and players
and user access across network.

 3
 

 

 

·                                          This PSO
will include all maintenance and support costs outlined in section 14 of PSO #
1 for Showboat AC.

·                                          Templates:  media, ads, and other content types.  Content types are also known as media types
or media components and are defined as follows: any individual component used
to create an ad or ad template, such as a graphic, audio file, video file,
animation, image file, foreground, background, branding, logo, or other
similar/related item.

5.           Ownership
of Work

All work performed for Client including
all Deliverables is defined as Client’s “Confidential Information” and Client’s
“Intellectual Property” in accordance with Section 7, Intellectual Property and
Section 12, Confidentiality of the Master Agreement.

All media templates, ads and Content
types created by Watchit Media must be pre-approved in writing by Client and
must air identical to what Client has created or pre-approved in writing.

6.           List
of Assumptions

·                                          The domain
profiles and account setup on domain will be accomplished using Client’s local
property IT.  Client’s personnel will be
available to setup the custom profile necessary to make sure that:

	
  

  	
  -

  	
  Players can auto-login into the domain

  
	
   

  	
  -

  	
  Players do not have any activities that will
  interrupt playback such as screen savers or virus pop ups. These types of
  activities will need to be configured in the domain profiles for these
  systems.

  
	
   

  	
  -

  	
  VNC (Virtual Network Computing) will be utilized for
  remote viewing and maintenance of players.

  
	
   

  	
  -

  	
  CastNET Server and Workstation can be setup on the
  domain

  

 

·                                          The CastNET
Server will be configured with IIS running on port 80 and FTP running on port
21.  Web access will be required on all
Client’s personnel desktops that wish to utilize and access the web based
content management CastNET interface. 
FTP (File Transfer Protocol) access will be utilized between the server
and the players to distribute content updates and status reports.

·                                          One fixed or
reserved DHCP IP (Dynamic Host Configuration Protocol Internet Protocol) will
be available for the CastNet Server and an appropriate DNS (Domain Name System)
name may be selected to make local property access to the server easier.  The players do not require fixed IP
addresses.  The PC naming conventions
will need to be available prior to configuration at Alpha Video for the CastNet
Server, workstation and all players.

 4
 

 

 

·                                          The scope of
work is based on information provided by Client to Watchit Media as set forth
in Section 2 of this PSO.

·                                          Any changes
to the Project will be handled by a PCR in accordance with Appendix F of this
PSO.

·                                          It is
Watchit Media’s responsibility to make sure that Watchit Media’s employees and
subcontractors comply with network security and virus protection standards as
stated in Section 20 of the Master Agreement and Appendix G of this PSO, and
incorporated herein by reference.  All
machines and systems used by Watchit Media must have industry-standard and
up-to-date virus protection.  If Watchit
Media’s machines or systems are found to cause problems on the Client’s
network, interfere with network applications or violate network security, such
machines will be immediately disconnected. 
Non-compliance by Watchit Media, its employees or subcontractors with
Client’s network security or virus protection standards shall constitute a
material breach of the Master Agreement and this PSO.  A list of all Client’s prohibited software
and hardware is attached as Appendix G to this PSO and is incorporated herein
by reference.

·                                          Client will
provide approved hardware, software, connectivity, accounts, user id’s, office
space, phone, fax and reprographic facilities for Watchit Media personnel at
Client location at Showboat in Atlantic City, NJ.

·                                          Client will
provide Watchit Media with access to 3rd-party tools used by Client and their
documentation for execution of the Project, such tools and documentation being
defined as Client’s Confidential Information in accordance with Section 12 of
the Master Agreement and subject to the Confidentiality provision of Section 12
of the Master Agreement.

·                                          Client will
provide access to Client building during office hours and if necessary, after
office hours, on week-ends and holidays.

·                                          THIS PSO
ASSUMES NO ACCESS TO CLIENT’S PRODUCTION SYSTEMS.  If this changes, a PCR will be requested in
accordance with Appendix F of this PSO, and Watchit Media agrees to abide by
Client’s production access procedures.

·                                          Watchit
Media is not responsible for cabling from Player PC to Clients Display.

·                                          Shipping
costs for hardware and software are estimates and shall not exceed this amount
unless the Client requests expedited or special shipping instructions in
writing.  Actual shipping costs related
to the transporting product will be billed to the Client at actual costs.  If Client has preferred carrier and wishes
Watchit Media to direct bill the shipping costs, this will be specified in the
purchase order.

·                                          The
management of virus software and Microsoft patches and updates will be the
responsibility of the Client for ongoing operations.

 5
 

 

 

7.           Documentation
to be Produced by Watchit Media:

·                                          The
operational manuals for users and administrators will be provided to Client in
electronic PDF format.  Watchit Media may
provide to Client customized operational manuals at no additional cost.

·                                          The overall
workflow block diagram for the property based on sample workflow and customized
for Client will be finalized and will show the contributing users, approvers,
approval process, content publishing, content distribution and playback.  This will be a representative layout at the
time of the final implementation, and is specific to the property.

·                                          Technical
Summary documentation providing IT support related summary of all servers,
workstations and players involved in the CastNET system and their specific pertinent
information.

·                                          Technical
support coverage contact numbers for the Watchit Media System.

8.           Documentation
to be produced by Client, if any

 

Day-to-Day
support personnel contact information

Emergency
after hours contact information

Remote
Access guidelines

Client’s
marketing plans, procedures and brand specifications as necessary to perform
its obligations under this PSO.

Client’s
contact list of project stakeholders and marketing stakeholders, subject to the
confidentiality provision of the Master Agreement

 

9.           Key
Personnel Assigned for Watchit Media:

·                                          Joshua
Hoffert—Account Project Manager

·                                          Alex Vinson—Art
Director, Content Creation

·                                          Eric Taitano—Senior
Designer, Content Creation

·                                          Erick Sturm—Vice
President, Media

·                                          Lance Hutchinson—Technical
Hardware/Software Specialist

·                                          Birgit
Davidson—IT Project Manager

·                                          Troy Seigert—Technical
Support Manager

·                                          Dan Rabin—Installer/Trainer

·                                          John Scott—Installer/Trainer

·                                          Robin
Bookout—Installer/Trainer

·                                          Kris
Berggren—System Engineer

·                                          Jeff
Carpenter—Systems Integrator

 

Once Watchit Media personnel are assigned
to this PSO, Watchit Media may not replace individual personnel without the
prior approval of Client.

 6

 

 

10.                               Project
Schedule:

Start date:       April
25, 2006       End Date: October 30, 2006

Specific dates
will be assigned upon project commencement.

 

	
  Phase

  	
   

  	
   

  	
   

  	
  Client or Watchit

  Media’s

  Responsibility

  	
   

  	
  Days Allotted

  
	
  Purchase Order Prepared

  	
   

  	
  Client

  	
   

  	
  2

  
	
  Software and Miscellaneous items ordered

  	
   

  	
  Joint

  	
   

  	
  1

  
	
  Equipment arrives at Alpha Video Minneapolis Office

  	
   

  	
  Client

  	
   

  	
  10

  
	
  Equipment is assembled and tested at Minneapolis
  Office

  	
   

  	
  Watchit Media

  	
   

  	
  2

  
	
  Final testing with initial configuration is
  completed

  	
   

  	
  Watchit Media

  	
   

  	
  2

  
	
  Equipment is shipped to local property

  	
   

  	
  Watchit Media

  	
   

  	
  1

  
	
  Equipment is received at local property

  	
   

  	
  Client

  	
   

  	
  5

  
	
  Technicians assemble and test equipment at local
  property

  	
   

  	
  Watchit Media

  	
   

  	
  2

  
	
  Technicians and local property IT get all systems
  onto Domain

  	
   

  	
  Joint

  	
   

  	
  1

  
	
  ·  Systems are tested on Customers Domain

  ·  Updated Content is loaded onto Customers
  Systems onsite

  	
   

  	
  Joint

  	
   

  	
  2

  
	
  ·   Testing of plasmas CAT5 VGA will be tested
  for sizing and playback quality through distribution system.

  	
   

  	
  Joint

  	
   

  	
  2

  
	
  ·   User Acceptance Testing to confirm all
  functionality and content specified by Client 

  ·   Systems are tested with updated content

  	
   

  	
  Joint

  	
   

  	
  2

  
	
  Final sign off on project by local operators

  	
   

  	
  Client

  	
   

  	
  1

  

 

11.                               Tasks
to be Performed by Client

·                                          Client will
purchase PCs directly from desired computer vendor meeting the requirements
outlined in Appendix C and shipped to Alpha Video’s Minneapolis location for
configuration and testing prior to delivery on property.  Watchit Media

 7
 

 

 

will
have a minimum of one week to configure and test the systems prior to shipment
to the Client.

·                                          If spare PC’s
are desired to have in place to swap out for a player that has failed, Client
will acquire an appropriate spare desired computer vendor meeting the
requirements outlined in Appendix C system that can be used for this purpose.

·                                          Client will
have the equipment room prepped for Watchit Media arrival including: network
drops for each PC; appropriate power for PC’s and associated equipment.

·                                          Client will
ensure that the interconnect wiring between IT rooms related to CAT5
transmission systems will be in place prior to Watchit Media’s arrival.

·                                          Client will
provide access to Watchit Media a mail server as well as a mail account and
password for the NetManager to provide email alerts of real time system monitoring
to Client’s IT staff.  An additional mail
account and password will be required for the CastNET system for the email
notification to be activated within CastNET.

·                                          Any power
monitoring, conditioning or UPS equipment will be put in place by Client at its
discretion.  All Rack power, rails and
shelves required will be provided by Client.

12.                               Status
Reporting

Watchit Media will provide weekly status
reports, addressing the following areas:

·                                          Overall
Project Status—highlighting activities performed during
the reporting period, activities planned for next reporting period, schedule
variances, variances in the financials of the project, hours actually performed
per phase vs.  hours originally planned
for same phase and staffing

·                                          Issues—escalation
of project issues, obstacles

·                                          Risks—escalation
and visibility into project risks, and mitigation strategies

·                                          External
Project Dependencies—escalation and visibility into external
project dependencies and requirements

·                                          Change
Requests—escalation of project change requests, requiring approval
to change project scope, timeline, and/or cost

·                                          Milestones—escalation
and visibility into key project milestones

·                                          Key
Performance Indicators (KPIs)—highlighting progress against phase exit
criteria and deliverable completion

 8
 

 

 

13.                               Acceptance
Period

All acceptance criteria
and warranties set forth in Sections 4 and 15 of the Master Agreement apply as
if fully set forth herein.

	
   

  	
  Description of Acceptance Criteria

  	
   

  	
   

  	
  Watchit

  Media’s

  Responsibility

  	
   

  	
  Client sign off

  
	
  Installation of
  players

  	
   

  	
  Yes

  	
   

  	
  Yes

  
	
  Watchit Media
  System

  	
   

  	
  Yes

  	
   

  	
  Yes

  
	
  Installation of
  MPEG Players

  	
   

  	
  Yes

  	
   

  	
  Yes

  
	
  Templates:
  media, ads, and other content types

  	
   

  	
  Yes

  	
   

  	
  Yes

  

 

14.                               System
Maintenance and Content

Upon successful completion of the
Acceptance Period, and subject to section 6 of the Master Agreement, the Client
agrees to pay a total yearly license, maintenance, and support fees.  Fees will include all previously installed
software and hardware maintenance and support outlined in Section 13 of PSO
#1.  Total annual license, maintenance,
and support fees are to be paid monthly at a cost of one thousand seven hundred
forty dollars ($1,740) per month if paired with a reoccurring monthly content
creation.  If the Property opts out of the
monthly reoccurring content creation, annual license, maintenance, and support
fees are to be paid monthly at a cost of three thousand seven hundred seventy
dollars ($3,770) per month.  Maintenance
figures include all maintenance costs previously outlined in section 13 of PSO
#1.  The first payment towards annual
maintenance and support will billed at the completion of the acceptance period
and recurring annual maintenance will be billed in the consecutive months.  Watchit Media’s maintenance and support
program is outlined in Appendix D
which is attached to this PSO and incorporated herein by reference, and Section
14 of the Master Agreement and includes hardware repair or exchange, phone
support for any issue or system inquiry.

In addition, the Client will continue to
contract for ten (10) hours of content and template creation services in the
amount of one thousand three hundred and fifty dollars ($1,350) per month as
previously outlined in PSO #1.  Total
hour usage will be assessed quarterly to determine appropriate hour
requirements.  Unused hours rollover to
the next month and accrue for up to 12 months from date of accrual.  A grace level of service will be extended not
to exceed 20% of the total accumulated hours per quarter.  Additional hours in excess of the 20% grace
service will be billed quarterly, at the option of Watchit Media, at the rate
of one hundred eighty dollars ($180.00) per hour.

Monthly content will be trafficked to the
Clients property by means defined in the Master Terms and Conditions.  If Client chooses alternate delivery means,
the Client shall (i) reimburse Watchit for all expenses incurred by Watchit in
connection with performing

 9
 

 

 

these alternative Services, including
reasonable costs associated with special deliveries of equipment, content or
other materials as requested by Client, and (ii) pay any applicable taxes
related to the alternative Services.

The term of this Agreement shall be for
one (1) year from the conclusion of the acceptance period.  Thereafter, the Content and Template Creation
Services and the Maintenance and
Support shall be automatically renewed for successive one (1) year periods,
unless either party provides written notice to the other party of the intent
not to renew this Agreement.  Written
notice must be given at least thirty days prior to the expiration of the
Initial Term or current renewal term.

At any time either Watchit or the Client
may modify or amend this agreement in a written Project Change Request as
identified in Appendix F of this PSO. 
Project Change Request will specify any additions to, or deletions from,
the Services specified in this Agreement and any adjustment in the fees
identified herein by reason of the changes. 
Adjustments in fees in will be made by good faith negotiation of both parties
on the basis of their respective estimate(s) of increases or decreases in the
cost, required resources, and materials of the work due to the changes.

15.                               Subcontractors/Portion
of the work subcontracted

None

16.                               Client’s authorized
representative to approve Project Change Requests

(PCRs) in accordance with Appendix F of this PSO is: Mike Effner, Director of IT Development.

17.                               Payment
Schedule

The fixed or not to exceed total price
contract for the Products and Services to be performed by Watchit Media under
this PSO is one hundred sixty seven thousand two hundred ninety dollars
($167,290.00), which shall be paid on the following schedule:

	
  Milestone

  	
   

  	
   

  	
   

  	
  Percentage

  	
   

  	
  Amount

  
	
  Confirmation of
  order of hardware, software, and services

  	
   

  	
  25%

  	
   

  	
  $38,853.75

  
	
  Installation of
  hardware/software components

  	
   

  	
  50%

  	
   

  	
  $77,707.50

  
	
  Acceptance by
  Client

  	
   

  	
  25%

  	
   

  	
  $38,853.75

  
	
  Travel &
  Expenses (Actual billed, Not to Exceed)

  	
   

  	
   

  	
   

  	
  $7,875.00

  
	
  Shipping (Actual
  billed, Not to Exceed)

  	
   

  	
   

  	
   

  	
  $4,000.00

  

 

Work is scheduled to begin on April 25,
2006 and terminate by October 30, 2006 dependent on the Client site being ready
for the installation.

 10
 

 

 

Not-to-exceed total fee means that the
charges for the work done under this PSO cannot exceed the amount noted as the “not-to-exceed”
fee.  Any additional hours required to
complete the initial scope of work shall be Watchit Media’s exclusive
responsibility.

Invoices would be raised by the Watchit
Media at the end of each month for the Services for the month and would be due
for payment once the invoice is raised.

Reimbursable expenses incurred will be
reimbursed in accordance with Section 11 of the Master Agreement.  All Reimbursable Expenses are exclusively
limited to the list of Reimbursable Expenses set forth in Appendix E to this
PSO, which is incorporated herein by reference. 
During the performance of this PSO, Watchit Media shall limit their
Reimbursable Expenses to no more than 15% of the value of the fixed or
not-to-exceed total fee for the services provided hereunder.

Client can terminate this PSO at any time
with ten (10) business day’s prior written notice to Watchit Media.  In the event of such termination, Client
shall pay Watchit Media the daily rate per person for each day up to the date
of termination, in addition to all pre-approved Reimbursable Expenses.

All project invoices (where milestones
are set) shall be sent to:

	
  Bally’s Atlantic City

  
	
  Attn: Bill Borrenstein

  
	
  Park Place & Boardwalk Atlantic City, NJ 08401

  

 

Ongoing monthly content invoices and
annual maintenance costs shall be sent to:

	
  Bally’s Atlantic City

  
	
  Attn: Colleen Cornell

  
	
  Park Place & Boardwalk Atlantic City, NJ 08401

  

 

All payments shall be sent to Watchit
Media’s address at:

	
  Watchit Media

  
	
  4046 West Highway 7

  
	
  PO Box 516

  
	
  Montevideo, MN 56265

  

 

 11
 

 

 

The
parties agree that the complete agreement between the parties consists of 1)
this Product and Services Order and 2) the Master Agreement.

 

	
  Agreed to:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Boardwalk
  Regency Corporation

  	
   

  	
   

  	
   

  	
   

  
	
  a New
  Jersey corporation

  	
   

  	
   

  	
  Watchit Media USA, Inc.

  	
   

  
	
  dba
  Caesars Atlantic City

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 12

 

APPENDIX A

WATCHIT MEDIA
PRODUCT & SERVICES

Manageit

Manageit, an Enterprise Media Management
System, is a modular server based system that uses Scala technology as the
engine, and CastNET for creating, scheduling, and publishing ads.  The system consists of servers, players, the
Net Manager, and the Creator module. 
Completely scalable, Manageit is accessed using any web browser on any
computer; user security authorization is required for access.  Once a user is logged into the system they
may access a very simple interface to perform any activity for which they have
been granted permission.  Activities are
functions of the system as well as rights or permissions granted to each
user.  They are as follows:

·                                          Create — Users create ads based on predefined
templates, combining video, text, graphics, and dynamic information from
databases.

·                                          Review — Authorized users can view ads submitted for approval, or ads that
are being created.

·                                          Approve — Ads are approved and released for
scheduling or rejected for revisions and re-submission.

·                                          Schedule — Approved ads are scheduled to play on predetermined days and
times, and may be scheduled up to a year in advance.

·                                          Publish — Once an ad is scheduled it will be
sent to the appropriate player(s) when it is published.

The Manageit infrastructure utilizes the
TCP/IP protocol over an existing CAT5 network. 
Players are modified PC’s specifically designed for the storage and
playback of motion media, and are enabled to send a program stream to any type
of display, including plasma, LCD, outdoor LED, projectors, and in room
television.  Players receive published
ads from the server where they are stored to be inserted into play lists.

Manageit allows assets such as video,
graphics, etc.  to be centrally located
and available to all Clients’ properties’ authorized users.  These assets can be monitored or regulated by
the corporate office to assure they align with the company brand and retain
consistency of message.  At the property
level these assets can be used to create messages for profiled guests,
utilizing proprietary programming, to target specific property sectors for
cross promotion, entertainment, and gaming.

NetManager

NetManager is the module for configuring
network actions in Manageit; Bandwidth
can be regulated and network rules can be activated to assure effective media
transport.

 13
 

 

Creator

Creator allows users to create ads from
pre-created templates, following a creation wizard ads are created by answering
questions, selecting media files and typing pre-formatted text.  Ad’s can be created quickly while the
template assures that the style is consistent with the Client’s brand.

Programming

Watchit Media, Inc. is a leader in
creating, producing and presenting high-impact dynamic digital
communication.  We have 12 years experience
in the creation proprietary television programming and management of Private
Video NetworksTM (Narrowcasting) to the gaming and hospitality industry.  We create, produce and present compelling
dynamic digital video communications for public displays and in-room
television.

 

 14

 

APPENDIX C

Manageit
System Hardware Configurations

Player System OS:

Windows 2000 or XP (please note if you
have service pack restrictions up front - otherwise we install latest available
versions)

·                                          Processor:  Pentium 4 2.8Ghz or faster Hyper Threaded processor  Memory: 
256MB or better

·                                          Video
Card:  NVideo GForce 5200 AGP chip set or
Intel 865G Extreme 2 AGP Chipset recommended 64MB Video Ram or greater

·                                          Disk
Space:  20GB or better 5400+ RPM

·                                          These can be
provided as Turnkey small form factor PC’s - we can also provide on a Compaq,
HP or Dell configuration

·                                          If Antivirus
software will be installed all popups will be deactivated as they interfere
with the playback software.

·                                          They
communicate to the server via FTP.

Creator and NetManager
System OS:

Windows 2000 or XP (please note if you
have service pack restrictions up front - otherwise we install latest available
versions)

·                                          Processor:  Pentium 4 2.8Ghz or faster Hyper Threaded
processor Memory:  256MB or better

·                                          Video
Card:  NVideo GForce 5200 AGP chip set or
Intel 865G Extreme 2 AGP chipset recommended 64MB video RAM or greater.

·                                          Disk
Space:  20GB or better 5400+ RPM Boot
Drive and Mapped Server D Drive

·                                          These can be
provided as Turnkey PC’s - we can also provide on a Compaq, HP or Dell
configuration

·                                          If Antivirus
software will be installed all pop ups will be deactivated as they interfere
with the playback software. These systems need to be able to map a drive from
the Server.

Server System OS:

Windows 2000 Server or 2003 Server
(please note if you have service pack restrictions up front - otherwise we
install latest available versions)

·                                          Processor:  Single Pentium 4 2.8Ghz or faster Hyper
Threaded processor or Dual Xeon 3Ghz+ processor - grows with size of
deployments

·                                          Memory:  1GB or better Video Card:  Most any onboard video that can provide 32bit
1024x768 resolution preferred

·                                          Disk
Space:  Deployment size varies storage
from 200 GB to 1TB based on content. 
Typically Raid 5 with Tape backup solution

 15
 

 

 

·                                          These are
provided as Turnkey servers - we can also provide on a Compaq, HP or Dell
configuration

·                                          If Antivirus
software will be installed, all pop ups will be deactivated as they interfere
with the playback software

·                                          The systems
communicate primarily via FTP protocol using a FTP server and IIS Web Server on
the Server system.  The D drive from the
server will need to be designated as the D drive on the Creator system.

·                                          Anti-virus
software is to be specified by client, so we can add the cost to the proposal
and install on server(s).

·                                          A secure VPN
or constant on remote access environment is highly recommended for support
purposes so remote troubleshooting can be provided.

 

 16

 

Appendix
E

Reimbursable
Expenses

Pursuant to the Product and Services
Order dated _____ __, 2006

Records of all costs and Reimbursable
Expenses incurred in connection with the Services performed under the terms and
conditions of this Agreement shall be kept in accordance with generally
accepted accounting principles and shall be available to Harrah’s pursuant to
the terms of Section “Audit” hereof. 
Copies thereof shall be made and presented to Harrah’s as and when
reasonably requested at no cost to Harrah’s.

All Reimbursable Expenses are exclusively
limited to the list of Reimbursable Expenses set forth in Exhibit “B”, which is
attached to this Agreement and incorporated herein by reference.  All Reimbursable Expenses shall be incurred
in accordance with the following policy. 
Reimbursable Expenses shall only be at actual costs and only in
connection with out-of-town travel of more than one hundred (100) miles from
Watchit Media’s location.  Authorized
travel expenses shall be billed listing the employee’s name, purpose of the
trip and the dates traveled.  Written
authorization shall be obtained in advance from Harrah’s.  Copies of all receipts, hotel bills, car rental receipts and like
documentation for other items will be provided with the billing.  Airfare will be at coach airfare.  Per diem expenses for food and hotel shall be
at Harrah’s place of business, if applicable and/or not to exceed Federal
Government per diem daily allowable rates for the City and State traveled into
without the express written advance permission of Harrah’s which can be given
by fax or e-mail.  It is Watchit Media’s
responsibility to submit only the Reimbursable Expenses.  Watchit Media’s invoices for Reimbursable
Expenses must be received by Harrah’s within forty-five (45) days of the date
the expense(s) was/were incurred or Harrah’s will no longer have to honor those
invoices.

Watchit Media is responsible for shipping
all products on Harrah’s designated shipper, as set forth herein.  Non-compliance with this provision will result
in a non-payment of Watchit Media’s freight bill to Watchit Media’s company
including document handling fees to process Watchit Media’s invoice for
payment.  Risk of loss is on the carrier
from time of pickup to Harrah’s loading dock. 
Harrah’s shall not pay any charges for handling and/or packaging.  Watchit Media should package material
appropriately for shipping.  This
provision shall not apply to any tribally owned Harrah’s managed property.  Shipments will be F.O.B.  Origin, 3rd party billing option.  FedEx Ground and FedEx Express should be used
for all inbound packages weighting less than 150 lbs.  (total shipment weight of less than 300 lbs.)
and FedEx Freight (should be sent “freight collect” unless otherwise
instructed) for all shipments over 300 lbs. 
At no time will Watchit Media ship on FedEx Express without prior
written approval from Harrah’s.  All
shipping documents require a purchase order number on the bill of lading.

 17
 

 

 

List
of Reimbursable Expenses

·                                          Standard
rooms

·                                          Use of a
rental car.  Intermediate class cars or
smaller must be booked unless any of the following conditions exist:

P            Four or more passengers will be
using the vehicle;

P            Business materials or equipment
require a larger vehicle;

P            An intermediate car is not
available;

P            For pre-approved medical reasons.

·                                          Reimburse
reasonable parking fees and tolls.

·                                          Travelers
will be reimbursed for the cost of taxis (NO Limo’s) to and from places of
business, hotel, airports or railroad stations in connection with business
activities if rental car usage is not also being paid for by Harrah’s.

·                                          Domestic air
travel must be in Economy class and, where possible, ticketed at least fourteen
(14) days in advance.

·                                          Meal
expenses incurred by the traveler when dining alone during out-of-town business
not to exceed the Federal Government per diem daily rates for the City and
State traveled into.

·                                          Air freight
via Federal Express for business purposes.

·                                          Personal car
mileage at the IRS rate of 44.5 cents per mile for business miles driven.

Non-Reimbursable Expenses

·                                          Additional
travel insurance coverage

·                                          Airline club
memberships

·                                          Airphone
usage

·                                          Air travel
upgrades

·                                          Auto repairs

·                                          Barber and
hair salon fees

·                                          Car washes
or detailing

·                                          Cell Phone
charges

·                                          Clothing

·                                          Donated
items or gifts

·                                          Excess baggage
charges, except for business materials or equipment

·                                          Expenses for
travel companions/family members

·                                          Expenses
relating to vacation or personal days incurred before, during, or after a
business trip

·                                          Fines and
penalties imposed for the violation of traffic laws while operating a personal
or rental car.

·                                          Forfeiture
fees for hotel rooms and/or rental cars unless there is sufficient proof that
the billing is in error.

·                                          Frequent
flyer tickets or upgrades

·                                          Hotel room
upgrades

·                                          Laundry or
valet services

 18
 

 

 

·                                          Lost or
stolen personal funds or property

·                                          Lost baggage

·                                          Magazines,
books, newspapers

·                                          Medical
expenses

·                                          Mini-bar
refreshments unless as a substitute for a meal

·                                          “No-show”
charges for hotel or car rental

·                                          Optional
travel or baggage insurance

·                                          Parking
tickets or traffic violation fines

·                                          Personal
accident insurance

·                                          Personal
automobile insurance.

·                                          Personal
entertainment, including sports events and theater

·                                          Personal
phone calls

·                                          Personal
property insurance

·                                          Personal
telegrams/telexes

·                                          Pet care or
kennel fees

·                                          Rental car
optional insurance

·                                          Rental car
phones

·                                          Rental car
upgrades

·                                          Repairs due
to accidents

·                                          Repairs to
personal vehicles

·                                          Spa, sauna,
massage fees

·                                          Shoe shine
expense

·                                          Souvenirs or
personal gifts

·                                          Theft of
personal property from room or rental car

·                                          Towing
charges

·                                          Travelers
check fees

·                                          Currency
conversion fees

·                                          Laundry/dry
cleaning/suit pressing for trips exceeding five consecutive nights

·                                          Any other
expense(s) not specifically defined as “Reimbursable Expenses” in this Exhibit.

 

 19

 

Appendix
F

Project Change Request (“PCR”)
Procedure

The Client without invalidating the
Product and Services Order (PSO), may order extra Services or make
changes within the general scope of the work by altering, adding to or
deducting from the Services which may result in a change to the estimated price
or completion date by both parties executing a PCR in the form attached as
Exhibit A to this PSO.  All Services
performed pursuant to a valid PCR shall be performed under the conditions of
the PSO.  The PCR will describe the
change, the rationale for the change, and the effect the change will have on
the PSO.

(b) PCR
Procedure.  Upon receipt of a request from the Client,
Watchit Media shall furnish to the Client a statement setting forth in detail
the proposal of Watchit Media for performing the extra Services or changes and
the effect of the extra Services or changes, if any, in the not-to-exceed price
and the completion date attributable to the extra Services or changes.  If an authorized representative of Client
approves in writing the proposal of Watchit Media, the parties shall execute a
PCR and the completion date may be adjusted accordingly.

 

 20

 

Appendix G

HARRAH’S OPERATING COMPANY,
INC. SECURITY POLICY

Pursuant to the Product and Service Order dated                           ,
2006

1.1.         Safeguarding
Harrah’s Information

Harrah’s
guidelines for safeguarding its information include measures that must be taken
when a supplier, vendor or Watchit Media (“Supplier”) maintains processes or
otherwise has access to Harrah’s Information by providing services directly to
our company.  Harrah’s Information is
defined as all information provided by Harrah’s to the Supplier or any Harrah’s
information accessible by the Supplier, including but not limited to, Harrah’s
proprietary information, Harrah’s confidential information, Harrah’s customer
information and regulatory controlled information.  Harrah’s information handling practices
comply with the existing Federal and State laws and create a continuum of
effective privacy protections for our corporation and customers.  Harrah’s also requires Suppliers doing
business with Harrah’s to uphold Harrah’s standards for the safeguarding of
Harrah’s Information which include but is not limited to Harrah’s corporate and
customer information.  Accordingly,
concerning all Supplier relationships, Supplier’s shall provide documentation
of the following:

1.1.1.                                       Suppliers
conduct appropriate privacy due diligence to review the measures used to
protect customer information.  Where
applicable, privacy due diligence is performed and documentation of it is
provided prior to the selection of a Supplier.

1.1.2.                                       Suppliers
will implement appropriate measures designed to safeguard and maintain the
confidentiality of Harrah’s Information. 
Supplier’s obligations to do so will be confirmed through the following
provisions which will be included in any agreement between Supplier and Harrah’s
(“Agreement”):

1.1.2.1.                                         Information Security Review.  Harrah’s reserves the right to perform
information security reviews on any systems or applications used by Supplier to
provide services to Harrah’s.  The
security reviews can include physical inspection, external scan, code review,
process reviews, and reviews of system configurations (“Security Reviews”).  The Security Reviews shall be conducted at
Harrah’s discretion, by Harrah’s or its designee (who shall be a reputable
security firm), and at Harrah’s expense unless provided otherwise.  Supplier shall grant permission to Harrah’s
to perform the Security Reviews.  Harrah’s
actions or results from any Security Reviews shall be the sole property of
Harrah’s and may not be utilized or relied on by Supplier in any way, except as
set forth by Harrah’s in performance of services hereunder.  Should any Security

 21
 

 

Review
result in the discovery of material security risks to the network used by
Supplier to perform services for Harrah’s, Supplier shall be solely responsible
for the cost of the Security Reviews. 
Harrah’s shall immediately notify Supplier of such risks and Supplier
shall respond to Harrah’s in writing within three days with Supplier’s plan to
take reasonable measures to promptly correct, repair, modify the said network
or application to effectively eliminate the risk at no cost to Harrah’s.

1.1.2.2.                                         Information Security Standards.  Harrah’s shall provide to Supplier its
Information Security Standards that define information security controls and
guidelines currently in place.  The
Supplier shall, in the performance by Supplier of services under the Agreement,
comply with all commercially reasonable standards within thirty days of receipt
of same, unless the parties agree otherwise. 
At any time during the term of the Agreement, and upon notice to
Supplier, Harrah’s may have a Security Review and an architectural design
review of the facilities and applications used by Supplier to perform services
for Harrah’s, such a review will be performed by either Harrah’s or a third
party, at Harrah’s discretion.  If a
security flaw is discovered, Harrah’s shall give immediate notice of such flaw
to Supplier and Supplier shall have five business days to formulate a plan to
cure such flaw, unless the parties agree to a longer period of time for such
cure.  Unless otherwise agreed to by the
parties, during the term of the Agreement, Supplier shall have thirty days from
receipt of notice to comply with any change in the Information Security
Standards.

1.1.2.3.                                         Electronic Incident Reporting.  Supplier shall report to Harrah’s all known
or suspected Electronic Incidents (as defined below).  If an Electronic Incident occurs Supplier
shall immediately notify Harrah’s IT Security and provide the following
information: nature and impact of the electronic incident; actions already
taken by Supplier; Suppliers assessment of immediate risk; corrective measures
to be taken, evaluation of alternatives, and next steps.  Supplier shall continue to provide
appropriate status reports to Harrah’s regarding the resolution of the
electronic incidents.  Harrah’s may
require that Supplier’s services be suspended, connectivity with Supplier be
terminated or other appropriate action be taken pending such resolution.

1.1.2.4.                                         Electronic Incident. 
Electronic Incident means any unauthorized action by a known or unknown
person which, whether successfully completed, attempted or threatened, 

 22
 

 

should
be reasonably considered one of the following with regard to Harrah’s site,
Harrah’s technology, Harrah’s systems or services, Supplier’s systems,
technology or deliverables provided to Harrah’s: an attack, penetration, denial
of service, disclosure of Harrah’s Information which includes but is not
limited to Harrah’s confidential information or customer information, misuse of
system access, unauthorized access or intrusion (hacking), virus intrusion,
scan of Harrah’s or Supplier’s systems or networks, or any other activity that
could affect Harrah’s systems or data. 
For purposes of this definition, “Supplier’s systems’” shall include the
systems, network technology, content or web sites of third party vendors used
by Supplier for the provision of Supplier’s services to Harrah’s.

1.1.2.5.                                         Supplier Monitoring. 
At Harrah’s discretion, Harrah’s shall monitor Suppliers to ensure that
they continue to meet obligations pertaining to safeguarding Harrah’s
Information.  Not more than once per year
throughout the term of the Agreement, Harrah’s may require Supplier to:

1.1.2.6.                                         Complete
Service Provider Information Security Questionnaire

1.1.2.7.                                         Provide
documentation of a recently completed security audit that measures information
security controls and guidelines currently in place.

1.1.2.8.                                         Permit
Harrah’s to perform site visit(s)

1.1.2.9.                                         Permit
Harrah’s to perform Security Review

 

 23

 

Appendix
H

LIST OF PROHIBITED SOFTWARE
& HARDWARE

Pursuant to the Product and Services Order dated                              ,
2006

These
items may exist on a Watchit Media’s laptop, but their use in Client’s network
environment is strictly prohibited.

·                                          Any type of
internet messaging, chat, weather, stock tickers, streaming media

·                                          No jazz
drives, zip drives, memory drives, or RW CD/DVD

·                                          No Server OS
installed on PC

·                                          No virus
protection other than Harrah’s standard, which is Norton

·                                          No modems

These prohibited items may NOT even exist on a Watchit Media’s laptop and
their use in Client’s network environment is strictly prohibited.

·                                          Any Remote
Control software, such as PC Anywhere, other than Windows Terminal Server
Client or VNC

·                                          No “hacker
tools,” keystroke loggers, password capture, or other systems analysis software

·                                          No sniffing
or network discover or analysis related tools

·                                          No Peer to
Peer communication software such as KaZaA, BadBlue, DirectConnect, CuteMX,
Napster, Scour, HotComm, or Blubster, etc... that could be used by someone to
take control of another person’s computer

 

 24

 

Exhibit A

Pursuant to
Appendix F

	
  Brief Description and reason
  for the Change Order:

  	
   

  	
  Request #:

  
	
  Project Release:

  	
   

  	
  Priority:

  (H/M/L)

  
	
  Phase:

  	
   

  	
   

  
	
  REQUEST DEFINITION

  
	
  Initiator:

  	
   

  	
  Date Opened:

  
	
  Detailed Description:      1.

  	
   

  	
   

  
	
  Additional
  Documentation Attached:

  	
   

  	
  Date Needed:

  

 

Project
Change Request (PCR) #        

This Project Change Request No.       
is entered into by and between Harrah’s Operating Company, Inc.  (“Company”) and               (“Watchit Media”) and is deemed to be incorporated
into the Statement of Work dated                   ,
200  and that certain Master Services Agreement dated as of the       
day of                       ,
200   by and between Company and Watchit Media (the “Master Agreement’).  Any terms used herein but not defined shall
have the meaning ascribed to such term in the Master Agreement.

1.             Description of Change Order and
Responsibilities of Parties:

 25
 

 

2.             Revised Deliverables:

	
  Deliverable Type

  	
   

  	
  Summary

  	
   

  	
  Estimated Date

  	
   

  	
  Estimated Hours

  
	
   

  	
   

  	
  ·  

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·  

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·  

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·  

  	
   

  	
   

  	
   

  	
   

  

 

The
Deliverables are defined as Company’s Confidential Information and Company’s
Intellectual Property in accordance with the Master Agreement.

3.             Work Statement Costs:

	
  Original Fixed Fee: 

  	
   

  	
   

  
	
  Change Order Amount:

  	
   

  	
   

  
	
  Total Not to Exceed
  with Revised Work Statement Costs: 

  	
   

  
					

 

4.             Revised Milestones and Payment
Schedule:

	
  Milestone #

  	
   

  	
  Milestone

  	
   

  	
  Estimated date relative to

  Start Date

  	
   

  	
  Payment

  Due

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

The parties agree that the complete
agreement between the parties consists of 1) this Project Change Request; 2)
the Statement of Work referenced above and 3) the Master Services Agreement.

 26
 

 

 

For
Harrah’s Operating Company, Inc.

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name

  	
   

  	
  Date

  	
   

  	
  Signed

  	
   

  

 

For Watchit Media:

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name

  	
   

  	
  Date

  	
   

  	
  Signed

  	
   

  

 

 27

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