**Exhibit 10.47**

 

 

 

 

**PURCHASEAND SETTLEMENT AGREEMENT**

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**by andbetween**

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**ELIXIRGAMING TECHNOLOGIES, INC.**

**(formerlyknown as VendingData Corporation);**

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**on the onehand**

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**And**

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**SHUFFLEMASTER, INC.,**

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on the other hand

 

 

**Dated as ofMarch_______, 2009**

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**PURCHASEAND SETTLEMENT AGREEMENT**

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THIS PURCHASE AND SETTLEMENTAGREEMENT (this “Agreement”) is made and entered into as of March _____,2009 (the “Execution Date”), by and between (i) Elixir GamingTechnologies, Inc., a Nevada corporation (formerly known as VendingDataCorporation) (“Seller”); and (ii) Shuffle Master, Inc., aMinnesota Corporation (“Buyer,” and together with Seller, the “Parties”).

 

WHEREAS, subject to theterms and conditions set forth herein, Buyer desires to purchase from Seller,and Seller desires to sell to Buyer the Acquired Assets and the Parties desireto settle litigation between them.

 

NOW, THEREFORE, inconsideration of the mutual covenants, agreements and understandings containedherein and intending to be legally bound, the Parties hereto hereby agree asfollows:

 

**ARTICLE I**

# **CERTAIN DEFINITIONS**

#  

1.1              Certain Definitions.  For purposes of this Agreement, the followingterms have the meanings set forth below:

 

“Acquired Assets”mean the assets, products and properties listed in Section 2.2(a);however, the Acquired Assets shall exclude any Excluded Asset.

 

“Affiliate” of anyparticular Person means any other Person controlling, controlled by or undercommon control with such Person, including subsidiaries, and parent companiesof such Person.  For purposes of thisdefinition, “control” (including the terms “controlling,” “controlledby” and “under common control with”) means the possession, direct orindirect, of the power to direct or cause the direction of the management andpolicies of a Person, whether through the ownership of voting securities, bycontract or otherwise, and such “control” will be presumed if any Person owns50% or more of the voting capital stock, assets or other ownership interests,directly or indirectly, of any other Person. In the case of Seller, Melco International Development Ltd and itsdirect and indirect subsidiaries of which it owns more than 50% shall beconsidered “Affiliates” for purposes of this Agreement.

 

“Applicable Rate”means interest at a rate per annum equal to the prime rate of interestannounced from time to time in The Wall Street Journal plus one percent(1%), calculated on the basis of the actual number of days elapsed over 365.

 

“And” means “or”; and“or” means “and”, as the context requires.

 

“Business Day” meansany day that is not a Saturday, a Sunday or other day on which banks arerequired or authorized by Law to be closed in the State of Nevada.

 

“Code” means:  the United States Internal Revenue Code of1986, as amended, and any reference to any particular Code section shall beinterpreted to include any revision of or successor to that section regardlessof how numbered or classified.

 

“Confidential Information”means the same as in the Non-Disclosure Agreement.

 

“Equipment” means allmachinery, apparatuses, and equipment, and related software (excluding,however, Inventory) which are owned by Seller and unique to and used in themanufacture or operation of the Acquired Assets.

 

 

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“Excluded Assets” hasthe meaning as ascribed thereto in Section 2.2(c).

 

“Gaming Permits” meangaming, regulatory body, certifying agency, governmental, or regulatorylicenses or approvals, or similar rights or documents applicable to any of theAcquired Assets.

 

“Gaming Product Approvals”mean any documentation related to the Acquired Assets issued by a gamingregulatory body and other approving/testing gaming laboratory (e.g. GamingLaboratory International, a/k/a GLI) indicating and/or certifying that aparticular item or product that has been submitted to such entity for properapproval is either approved or rejected for use in a particular gamingjurisdiction.

 

“Indebtedness” meansthe following, including, without limitation, with respect to any Lender,whether known or unknown, fixed or unfixed, contingent, accrued or unaccrued,liquidated or unliquidated:  (i) anydebts, liabilities or obligations of Seller for borrowed money or otherwise; (ii) anydebts, liabilities or obligations evidenced by any note, bond, debenture orother debt security; (iii) any liabilities or obligations with respect towhich Seller is liable, contingently or otherwise, as obligor or otherwise(including without limitation trade payables and other current liabilities); (iv) anycommitment by which Seller assures a creditor against loss (includingcontingent reimbursement obligations with respect to letters of credit); (v) anydebts, liabilities or obligations guaranteed in any manner by Seller (includingguarantees in the form of an agreement to repurchase or reimburse); (vi) anydebts, liabilities or obligations under capitalized leases with respect towhich Seller is liable, contingently or otherwise, as obligor, guarantor orotherwise or with respect to which obligations Seller assures a creditoragainst loss; (vii) any debts, liabilities or obligations secured by alien on Seller’s assets; (viii) any amounts owed by Seller to any Personunder any non-competition, consulting or deferred compensation arrangements;and (ix) all other debts, liabilities or obligations of any kind ornature.  The term “Indebtedness,”however, shall expressly exclude any obligation of an Affiliate of Seller.

 

“Intellectual Property”means each of the following in any jurisdiction throughout the world:  (i) patents, patent applications,divisionals, continuations, continuations in part, reissues, reexams andassociated patent families, whether in the United States or in other countries;(ii) trademarks, service marks, trade dress, trade names, logos andslogans (and all translations, adaptations, derivations and combinations of theforegoing) and any internet domain names that incorporate or refer to the namesof any of the Products, together with all goodwill associated with each of theforegoing, all of the foregoing, whether registered or common-law; (iii) copyrightsand copyrightable works; (iv) registrations and applications for any ofthe foregoing; (v) trade secrets, confidential information, know-how andinventions; (vi) computer software used in the Products (including but notlimited to source code, executable code, data, databases and documentation);and (vii) all rights to make, have made, use, have used, sell, offer forsale, lease, promote and otherwise deal with the Products.

 

“Inventory” means allProduct finished goods and related Product packaging materials owned by Sellerin either Seller’s or a third party’s possession as at the date hereof, andwherever located, including consignment inventory.  For the avoidance of doubt, (a) any Productfinished good sold (whether by way of an outright sale, hire-purchase orcapital lease) by the Seller to a third party prior to Closing but the pricethereof has not been fully paid by the relevant purchaser shall not be regardedas being owned by the Seller or included in the Inventory for the purpose ofthis Agreement notwithstanding the fact that the Seller may retain possession,title, vendor’s lien on or other similar rights in such non-fully paid Productfinished goods and (b) any Product which Seller permits any of itsdistributors (or any sub-distributors of such distributors), including, withoutlimitation, Suzo Happ, to retain for use by such distributor or sub-distributorshall be excluded from the Inventory and shall not be counted for purposes ofthe Inventory Adjustment.

 

“Law” means anyfederal, state, provincial, administrative, tribunal, gaming, local or foreignlaw, statute, code, ordinance, rule, regulation or restriction (including thoseof administrative agencies), including without limitation, RoHS, CE, UL andCUL.

 

 

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“Legal Gaming Venues”mean all casinos, gaming operators or other places where gaming or wagering islegal and properly licensed by Law.

 

“Lenders” meansBricoleur Partners, L.P., Bricoleur Enhanced, L.P., BRIC 6, L.P., BricoleurOffshore Ltd., Premier Trust of Nevada, Premier Trust, Inc., CentralLeasing Co. of NJ, LLC, Madison Leasing Co., Inc. and each of theirrespective predecessor and successor entities, and “Lender” means anyone of the foregoing.

 

“Lien” means anytransfer restriction, mortgage, security interest, deed of trust, option, rightof first refusal, pledge, hypothecation, assignment, charge, depositarrangement, encumbrance, easement, lien (statutory or other), securityinterest and any other preference, priority or preferential arrangement of anykind or nature whatsoever, including any conditional sale contract or othertitle retention agreement, the interest of a lessor under a capital lease and anysynthetic or other financing lease having substantially the same economiceffect as any of the foregoing.

 

“Litigation” means *Shuffle Master, Inc. v. VendingData Corporation,*Case No. 2:04-CV-1373-BES-(LRL)pending in the U.S. District Court, District of Nevada.

 

“Loss” means anyloss, liability, demand, claim, obligation, action, cause of action, cost,damage, diminution in value, lost profits, deficiency, Tax, penalty, fine orexpense, including without limitation, interest, penalties, lost profits, attorneys’fees and expenses and all amounts paid in investigation, defense or settlement,(such as expert witness fees) of any of the foregoing and the enforcement ofany rights hereunder), and whether known or unknown, fixed or unfixed,contingent or accrued, but excludingonly unforeseeable, speculative,  and,unless the applicable Party has committed actual fraud, exemplary and punitivedamages.

 

“Patents” mean theissued patents and pending patent applications of Seller and each of theirpatent families used in or relating to the Acquired Assets, including but notlimited to the following: patents, patent applications, divisionals,continuations, continuations in part, reissues, reexams and associated patentfamilies, whether in the United States or in other countries.

 

“Person” means anyindividual, sole proprietorship, partnership, joint venture, trust,unincorporated association, corporation, limited liability company, entity orgovernmental entity (whether federal, state, county, city or otherwise and includingany instrumentality, division, agency or department thereof).

 

“Products” mean,singularly or plurally, the following owned by Seller, no matter where located(including all models and versions thereof): (i) ShufflePro, RandomPlusand PokerOne shufflers and any other shufflers; and (ii) DeckCheckers.

 

“Related Agreements”mean: (i) any Schedules attached to this Agreement; (ii) a bill ofsale, a patent assignment, and a trademark assignment, in each case betweenBuyer and Seller; (iii) the Escrow Agreement; (iv) the LitigationStipulation; (v) any Instruments of Conveyance; and (vi) theNon-Disclosure Agreement.

 

“RoHS” meansDirective 2002/95/EC of the European Parliament and of the Council of 27 January 2003,on the restriction of the use of certain hazardous substances in electrical andelectronic equipment , as amended, and implemented by European Union memberstates.

 

“Schedules” mean theschedules (dated as of the Closing Date) prepared by the Seller and attached tothis Agreement.

 

“Shuffler and DeckCheckerIntellectual Property” means the Patents, the Trademarks, and any otherIntellectual Property owned by Seller that is used in any Acquired Asset,whether or not listed on any Schedule.

 

 

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“Suzo Happ” shallmean any of the following including Affiliates and sub-distributors of thefollowing: Happ Controls, Inc.; AESI; Suzo International; and Suzo-HappGroup.

 

“Taxes” mean anyfederal, state, local or foreign income, gross receipts, license, payroll,employment, excise, escheat, severance, value-added, consumption, stamp,occupation, property, windfall, profits, environmental, customs, or any othertax, governmental fee, governmental assessment or governmental charge of anykind whatsoever, including any interest, penalties or additions to Tax oradditional amounts with respect to the foregoing.

 

“Tax Returns” meanreturns, declarations, reports, claims for refund, information returns or otherdocuments (including any related or supporting schedules, statements orinformation) filed or required to be filed in connection with thedetermination, assessment or collection of Taxes of any party or theadministration of any laws, regulations or administrative requirements relatingto any Taxes.

 

“TCS” shall mean anyof the following including Affiliates and sub-distributors of the following:Technical Casino Supplies LTD, an English company; TCS Aces Pty. Ltd.; TCSAmerica, Inc.; and Victoria Holdings Ltd.

 

“Trademarks” mean theregistered trademarks, all common-law trademarks and the pending trademarkapplications of Seller used in the Acquired Assets, together with all goodwillsymbolized thereby and associated therewith.

 

“Transferred Spare Parts”shall have the meaning ascribed thereto in Section 2.7(c) of thisAgreement.

 

“Treasury Regulations”mean the United States Treasury Regulations promulgated under the Code, and anyreference to any particular Treasury Regulation section shall be interpreted toinclude any final or temporary revision of or successor to that sectionregardless of how numbered or classified.

 

**ARTICLEII**

# **PURCHASE AND SALE OFACQUIRED ASSETS**

 

2.1              Basic Transaction.  The transaction contemplated in thisAgreement and in the Related Agreements (the “Transaction”) shallconsist of, as of the Closing Date:  (i)Buyer’s purchase of the Acquired Assets; (ii) Seller agreeing to theNon-Compete Obligations; (iii) Buyer paying Seller the Purchase Price; and (iv)the dismissal of all pending Litigation between the Parties, including, withoutlimitation, the Parties’ execution and delivery of the Litigation Stipulationand the mutual general release, in each case as provided in Section 2.2(d).

 

### 2.2                 (a)  Acquired Assets.  On the terms and conditions set forth in thisAgreement, Buyer shall purchase from Seller, and Seller shall sell, convey,transfer, assign and deliver to Buyer, as of the Closing Date, all right, titleand interest, free and clear of any and all Liens, in and to each of thefollowing:

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#### (i)         all Products;

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#### (ii)         all Inventory, as set forth in Schedule 4.22(a);

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#### (iii)        the Shuffler and DeckChecker Intellectual Property,including, without limitation, the Shuffler and DeckChecker IntellectualProperty set forth in Schedule 4.13(a), together with all income, royalties,damages and payments due or payable (other than accounts receivablecontemplated by Section 2.2(c)(i) and installment payments due orthat become due in the future under any installment contract entered into bySeller prior to the Closing Date) with respect to any periods ending after theClosing Date (including, without limitation, damages and payments for past andfuture infringements or misappropriations thereof), the right to sue andrecover for past and future infringements or misappropriations thereof, any andall corresponding 

 

 

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#### rights that, now or hereafter, may be securedthroughout the world and all copies and tangible embodiments of any suchShuffler and DeckChecker Intellectual Property;

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#### (iv)       [INTENTIONALLY OMITTED];

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#### (v)        the right to receive and retain mail and other communicationsto the extent relating to the Inventory, the Products or the Shuffler andDeckChecker Intellectual Property from the Closing Date and thereafter;

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#### (vi)       [INTENTIONALLY OMITTED];

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#### (vii)      all of the following, if applicable and in existence, coveringor relating to any of the Products, whether in writing, electronic data,computer software or otherwise: bills of materials, engineering drawings,diagrams and specifications, circuit diagrams, schematics, mask works, partslists, models, files, histories, reports, certifications, user manuals, servicemanuals, training manuals, sales literature, technical bulletins, partsbreakdowns, manufacturing work instructions, quality control work inspectioncriteria, submission packages to regulators, validity studies, novelty studies,clearance studies, infringement studies and any other documents or informationnecessary to manufacture the Products. In this respect, a complete index of the above information and documentswith respect to the DeckChecker that exist as at the Closing Date is set forthin Schedule 2.2(a)(vii).  For theavoidance of doubt, Buyer acknowledges that some of the above mentioned informationand documents may never exist and some of them might have existed in the pastbut due to passage of time, may have gone astray;

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#### (viii)      all lists of customers and suppliers forany of the Products; all Shuffler and DeckChecker Intellectual Property files,attorney correspondence, and prosecution file histories, including, withoutlimitation, all original copies of issued patents and trademark registrations;all advertising, marketing and promotional materials relating to any Products;in each case regardless of whether such items are evidenced in writing,electronic data, computer software or otherwise; provided, however,that for the avoidance of doubt, any items described in this subsection (viii) whichare in the possession of any of Seller’s attorneys shall be included in theAcquired Assets, and Seller agrees to instruct any such attorneys to transfersuch items to Buyer; provided, further, that nothing contained inthis subsection (viii) shall require Seller to transfer to Buyer anyinformation which is subject to an attorney-client privilege between Seller andSeller’s counsel to the extent it relates to any intellectual property disputebetween the Parties; and

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#### (ix)       all Gaming Product Approvals, if any, applicable to theProducts as set forth on Schedule 2.2(a)(ix) (the items in Sections2.2(a)(vii), 2.2(a)(viii) and 2.2(a)(ix) are collectively referred toas “Seller’s Shuffler and DeckChecker Books and Records”).

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### (b)    Seller’s Non-Compete Obligations.

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Subject to (i) Buyer’s payment to Seller at theClosing of $2,400,000 pursuant to Section 2.4 and (ii) Buyer causingthe fully executed Litigation Stipulation to be filed with the clerk of theUnited States District Court for the District of Nevada, Seller hereby agreesto each and all of the Non-Compete Obligations, as contained in Section 7.9hereof; provided, however, that Seller shall be relieved of theNon-Compete Obligations if (x) Buyer agrees in writing that (A) thefinal Inventory Adjustment (as defined in Section 2.6(a)) and (B) theHoldback Amount (as defined in Section 2.5(b)(ii)) and the AdditionalAmount (as defined in Section 2.5(b)(iii)) are not subject to theprovisions of Section 2.5(b)(iv)(B)(1) and/or (2), but neverthelessrefuses for a period of thirty (30) days following a written request by Sellerto join in an instruction to the Escrow Agent to release such funds as soagreed, or (y) an arbitrator determines pursuant to a final arbitrationaward under Section 8.15 below that the Holdback Amount and/or AdditionalAmount are required to be released but Buyer objects thereto.  Except as expressly set forth in thissubsection (b), under no circumstances shall Seller be relieved of the Non-

 

 

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Compete Obligations, whetherdue to any breach by Buyer or any of its Affiliates of this Agreement, anyRelated Agreement or otherwise.

 

(c)    Excluded Assets. Notwithstanding the foregoing, the following properties, assets andrights of Seller (the “Excluded Assets”), which would otherwise beAcquired Assets are expressly excluded from the Transaction and, as such, arenot included in the Acquired Assets:

 

#### (i)         any cash, cash equivalents, or accounts receivable held bySeller, including but not limited to any trade receivables pertaining to anyAcquired Assets accruing prior to the Closing Date and any installment paymentsdue or that become due in the future under installment sale contracts enteredinto by Seller prior to the Closing Date;

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#### (ii)        all stock and other ownership interests in Seller;

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#### (iii)       all real property;

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#### (iv)       all standard “off the shelf” personal property, such asfurniture and computers;

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#### (v)       Seller’s corporate charter and related documents, relatingsolely to the organization, maintenance and existence of Seller as acorporation;

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#### (vi)      claims for and rights to receive Tax returns and refundsrelating to any Acquired Assets with respect to taxable periods preceding theClosing Date;

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#### (vii)      the Purchase Price;

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#### (viii)     Seller’s rights under or pursuant to thisAgreement or any Related Agreement;

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#### (ix)       the Equipment (other than the items described in Section 2.7(d));and

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#### (x)        all production supplies, other supplies, spare parts (otherthan the Transferred Spare Parts) and work in progress of the Products; provided,however, with respect to any work in progress which becomes a finishedProduct after the Closing, Seller shall not sell, lease or license any suchfinished Product, but rather shall either (1) transfer such finishedProduct to Buyer for no additional consideration on an “as is, where is” basisor (2) scrap such finished Product.

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In addition to theforegoing, Seller shall be entitled to keep and retain copies of Seller’sShuffler and DeckChecker Books and Records and other documents pertaining tothe Acquired Assets as reasonably required for purposes of compliance with tax,gaming and other applicable Laws; provided, however, that Sellershall not retain and shall promptly turn over to Buyer all originals of anysuch documents and shall keep the information contained in all such documentsconfidential, except to the extent required to be disclosed pursuant toapplicable Laws.

 

(d) PendingLitigation; Releases.

 

### (i)         On the Closing Date, the Parties shall:

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##### (A)       execute and deliver a stipulationdismissing with prejudice all pending Litigation between the Parties andproviding for the return to Buyer of Buyer’s $3 million deposit with the clerkof the United States District Court for the District of Nevada (the “Deposit”),and all accrued or due interest, if any, as Buyer’s sole property, in the formattached hereto as Schedule 2.2(d) (the “Litigation Stipulation”);

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##### (B)       execute (whether on the Closing Date orthereafter) and deliver all other documents reasonably requested by Buyer tocarry out the foregoing.

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#### (ii)        Except for (A) Seller’s obligations under this Agreementor any Related Agreement, and (B) any action or claim by Buyer or any ofits Affiliates against Seller or any of its Affiliates with respect to productssold or purchased by Buyer or any of its Affiliates to or from Seller or any ofits Affiliates in the ordinary course of business or contractual relationshipsbetween such parties (collectively, “Buyer Carve Outs”), Buyer, onbehalf of itself and its Affiliates, hereby releases Seller and its direct andindirect subsidiaries and their respective officers, directors,representatives, heirs and assigns (collectively, the “Seller ReleasedParties”) from any and all claims, liabilities or expenses, which Buyer orany of its Affiliates had or could have had, or whether asserted or could havebeen asserted, for any acts or omissions of any of the Seller Released Partiesprior to the Closing Date, known or unknown, accrued or unaccrued, andliquidated or unliquidated.

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#### (iii)       Except for (A) Buyer’s obligations under this Agreementor any Related Agreement, and (B) any action or claim by Seller or any ofits Affiliates against Buyer or any of its Affiliates with respect to productssold or purchased by Seller or any of its Affiliates to or from Buyer or any ofits Affiliates in the ordinary course of business or contractual relationshipsbetween such parties (collectively, “Seller Carve Outs”), Seller, onbehalf of itself and its direct and indirect subsidiaries, hereby releasesBuyer and its Affiliates and their respective officers, directors,representatives, heirs and assigns (collectively, the “Buyer ReleasedParties”) from any and all claims, liabilities or expenses, which Seller orany of its direct or indirect subsidiaries had or could have had, or whetherasserted or could have been asserted (including, without limitation, withrespect to the Deposit), for any acts or omissions of any of the Buyer ReleasedParties prior to the Closing Date, known or unknown, accrued or unaccrued, andliquidated or unliquidated.

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#### (iv)       Each Party hereby acknowledges that such Party may hereafterdiscover claims or facts in addition to or different from those which suchParty now knows or believes to exist with respect to the subject matter of therelease contained in this Section 2.2(d) and which, if known orsuspected at the time of executing this Agreement, may have materially affectedsuch Party’s decision to enter into this Agreement.  Nevertheless, except for the Buyer Carve Outsand Seller Carve Outs, each Party expressly waives any claim, liability orexpense that might arise as a result of such different or additional claims orfacts, and such Party hereby acknowledges, understands and agrees that therelease contained in this Section 2.2(d) extends to all claims,liabilities or expenses, whether known or unknown, suspected or unsuspected.Each Party further expressly waives and releases any rights and benefits whichit has or may have under any law or rule of any jurisdiction pertaining tothe matters released herein and expressly waives and releases any and allrights and benefits conferred upon such Party by the provisions of Section 1542of the Civil Code of the State of California (or any similar statute), whichprovides as follows:

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A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THECREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OFEXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLYAFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.

 

#### (v)        Notwithstanding anything to the contrary in this Agreement orin the Litigation Stipulation, each of the Parties shall bear its own legalfees and other costs and expenses in connection with the negotiation, executionand delivery of the Litigation Stipulation and the return of the Deposit toBuyer.

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2.3                    Liabilities.

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Notwithstanding anything to the contrary in thisAgreement, Buyer is not and shall not assume or in any way become liable forany liabilities, obligations, Indebtednesses or Losses of Seller or of anynature whatsoever relating to Seller, Seller’s business, the Products, theShuffler and DeckChecker Intellectual Property, or any of the Acquired Assets,whether accrued, absolute, contingent or otherwise, whether known or unknown,whether due or to become due, whether liquidated or unliquidated (collectively,the “Excluded Liabilities”), including without limitation:

 

### (a)  any of Seller’s liabilitiesor obligations for expenses or fees related to or arising out of thenegotiation, preparation, approval or authorization of this Agreement or theconsummation of the Transaction (including all attorneys, accountants,investment bankers and brokerage fees);

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### (b)  any of Seller’s liabilitiesor obligations relating to any legal action, proceeding or claim related to,arising out of or in connection with Seller or Seller’s ownership or operationprior to the Closing Date of the Seller’s business, the Products, the Shufflerand DeckChecker Intellectual Property, any of the Acquired Assets, or any otherconduct, acts or omissions of Seller or Seller’s officers, directors,employees, consultants, distributors, agents or advisors relating to any of theforegoing, including, without limitation, any legal action, proceeding or claimby any Lender;

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### (c)  any liabilities orobligations in respect of any of the Excluded Assets (other than the payment ofthe Purchase Price);

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### (d)  any of Seller’s liabilitiesor obligations which Buyer may become liable for as a result of or inconnection with the failure by Seller to comply with any bulk sales or bulktransfers laws or as a result of any “de facto merger” or “successor-in-interest”theories of liability; and

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### (e)  any of Seller’s or any of itsAffiliates’ Indebtedness for royalties, distribution fees, license fees, Lossesor other obligations, whether present or future, existing or contingent,accrued or unaccrued, known or unknown, liquidated or unliquidated, whetherunder contract or for torts, to:  (i) TCS,(ii) Happ Controls, Inc., including without limitation, AESI, andSuzo Happ; (iii) Ten Stix; or (iv) any distributor, agent, licenseeor representative with respect to any Product.

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2.4                    Consideration.

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### The total consideration tobe paid, in full, by Buyer for the Transaction shall be US $2,600,000 (the “ClosingPurchase Price”), plus or minus the amount, if any, of the InventoryAdjustment (collectively, the “Purchase Price”); plus, as part of theTransaction, Seller shall agree to the Non-Compete Obligations and the Partiesshall agree to the mutual release set forth in Section 2.2(d).

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2.5                    Closing Transactions.

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(a)  Closing.  Subject to the conditions set forth herein,the consummation of the Transaction (the “Closing”) shall take place ator before 10:00 a.m., Las Vegas time, on March _____, 2009 (the “ClosingDate”), at which time this Agreement shall be executed and becomeeffective.

 

### (b)  Payment and Deliveries.  Subject to the conditions set forth in thisAgreement, at the Closing (or within the time periods specified below, whereapplicable):

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#### (i)         Each Party shall execute and deliver to the other anoriginal and a copy of this Agreement;

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#### (ii)        Buyer shall (A) pay the Closing Purchase Price, less aportion of the Closing Purchase Price equal to Two Hundred Thousand Dollars($200,000) (the “Holdback Amount”), by wire transfer 

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#### of immediately available funds to an accountwhich has been designated in writing by Seller to Buyer, and (B) depositinto a non-interest bearing escrow account (“Escrow Account”)established with Greenberg Traurig, LLP as escrow agent (“Escrow Agent”)the Holdback Amount to be held and distributed by Escrow Agent in accordancewith an escrow agreement (“Escrow Agreement”), in the form of Exhibit Aattached hereto, to be entered into at the Closing by Seller, Buyer and EscrowAgent;

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#### (iii)       Buyer shall also deposit into the Escrow Account an amount incash equal to Two Hundred Thousand Dollars ($200,000) (the “AdditionalAmount”) to be held and distributed by Escrow Agent in accordance with theEscrow Agreement;

####  

#### (iv)       Seller shall deliver, transfer and convey to Buyer, free andclear of any Liens, all right, title and interest in and to all of the AcquiredAssets.  With respect to any Inventory,Seller shall either (at the election of Buyer) arrange for the delivery of suchproperties to Buyer (at Buyer’s expense) or permit Buyer to take delivery ofthe Inventory at such places where the same are located as set forth inSchedule 4.22(a); provided, however, that (A) with respectto the Inventory located in the People’s Republic of China, Seller shall besolely responsible for, and shall indemnify Buyer against, any Taxes, duties,tariffs, charges, fees or other liabilities or expenses imposed by anygovernmental entity in connection with the transportation and exportation ofsuch inventory within and from the People’s Republic of China, and (B) withrespect to any Inventory in the possession of Suzo Happ, Seller shall use itsbest efforts to ensure that Suzo Happ grants Buyer full access to suchInventory (including, without limitation, for purposes of inspection anddelivery arrangements), and Seller acknowledges and agrees that (1) Buyershall be entitled to withhold, or instruct the Escrow Agent to withhold,payment of the amount, if any, of the Inventory Adjustment owing to Sellerpursuant to Section 2.6(a)(iii) or (iv) in respect of suchInventory until Suzo Happ has granted Buyer full access to and the opportunityto pick up such Inventory during normal business hours following reasonablenotice by Buyer, and (2) in the event Suzo Happ has not, within ninety(90) days after the Closing Date, granted Buyer full access to and theopportunity to pick up such Inventory during normal business hours followingreasonable notice by Buyer, Buyer shall be entitled to receive from the EscrowAccount the amount, if any, of the Inventory Adjustment owing to Sellerpursuant to Section 2.6(a)(iii) or (iv) in respect of suchInventory.  Buyer agrees to usereasonable efforts to pick up any Inventory in the possession of Suzo Happafter Suzo Happ grants Buyer full access to (including but not limited to theability to inspect such Inventory before pick up) and the opportunity to pickup such Inventory.  To evidence thetransfer and conveyance of the Acquired Assets to Buyer, the Seller shalldeliver to Buyer such appropriately executed instruments of sale, transfer,assignment, conveyance and delivery, bills of sale, assignments andassumptions, Intellectual Property assignments or other Intellectual Propertyconveyance documents, certificates of title, and all other instruments ofconveyance, including those which arereasonably requested to effect transfer to Buyer of good and marketabletitle, free and clear of any Liens, to each of the Acquired Assets, includingdocuments acceptable for recordation in the United States Patent and TrademarkOffice, the United States Copyright Office and any other similar domestic orforeign office, department or agency, it being understood that all of theforegoing shall be in such form and substance prepared by the Buyer and itscounsel and incorporating reasonable comments from the Seller;

####  

#### (v)        Seller shall also deliver, transfer and convey to Buyer, tothe extent that the same has not been delivered, transferred or conveyed to theBuyer prior to the Closing Date:

####  

#### (A) any and allappropriate documentation to be filed with the U.S. Patent and Trademark Officeand the U.S. Copyright Office, reflecting the release of all Liens on any ofthe Acquired Assets;

####  

#### (B) duly authorizedUCC-3 statements evidencing release of all Liens on any of the Acquired Assetsin all jurisdictions identified by the Buyer;

####  

#### (C) any other document,waiver, acknowledgement, certificate, financing statement and/or release reasonablyrequested by Buyer to evidence the release of any Liens on the Acquired Assets;

####  

 

Page 9

####  

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#### (D) all third party approvals, if any,that are necessary for the consummation of the Transaction, on terms reasonablysatisfactory to Buyer;

####  

#### (E) Shuffler and DeckChecker Books andRecords, which such Shuffler and DeckChecker Books and Records shall be deliveredto Buyer no later than 15 days after the Closing Date;

####  

#### (F) certified copies of resolutions ofSeller’s board of directors authorizing and approving the execution, deliveryand performance of this Agreement and the consummation of the Transaction;

####  

#### (G) all Related Agreements (other thanInstruments of Conveyance and the Non-Disclosure Agreement) in fully-executedform by the Seller; and

####  

#### (H) such other documents or instrumentsas are required to be delivered at the Closing pursuant to the terms hereof orthat Buyer reasonably requests prior to the Closing Date to effect theTransaction.

####  

#### (vi)       Buyer shall also deliver to Seller all Related Agreements(other than Instruments of Conveyance and the Non-Disclosure Agreement) infully-executed form by the Buyer.

####  

2.6            Inventory Adjustment.

 

### (a)    Within fourteen (14) days after the Closing Date, Buyer andSeller shall meet and conduct a joint inspection of the Inventory (the “InventoryInspection”) to determine the number of Fully Qualified Deck Checkers (as definedbelow) and the number of Fully Qualified Shufflers (as defined below) includedin the Inventory.  Upon completion of theInventory Inspection, Seller or Buyer, as applicable, shall pay, or cause to bepaid in accordance with Section 2.6(c) below, to the other Party anypositive net amount determined as follows (collectively, the “InventoryAdjustment”):

###  

#### (i)         Seller shall pay to Buyer an amount in cash equal to theproduct of (i) thirty-nine (39) minus the number of deck checkers includedin the Inventory which are Fully Qualified Deck Checkers, multiplied by (ii) SevenThousand Five Hundred Dollars ($7,500);

####  

#### (ii)        Seller pay to Buyer an amount in cash equal to the product of(i) one hundred thirteen (113) minus the number of shufflers included inthe Inventory which are Fully Qualified Shufflers, multiplied by (ii) TwoThousand Dollars ($2,000);

####  

#### (iii)       for each deck checker in excess of thirty-nine (39) deckcheckers which is included in the Inventory and which is a Fully Qualified DeckChecker, Buyer shall pay to Seller an amount in cash equal to Seven ThousandFive Hundred Dollars ($7,500); and

####  

#### (iv)       for each shuffler in excess of one hundred thirteen (113)shufflers which is included in the Inventory and which is a Fully QualifiedShuffler, Buyer shall pay to Seller an amount in cash equal to Two ThousandDollars ($2,000).

####  

### Notwithstanding the foregoing or anything in thisAgreement to the contrary, Buyer shall not be required to pay Seller in excessof Two Hundred Thousand Dollars ($200,000) in the aggregate in respect of theInventory Adjustment pursuant to subsections (iii) and (iv) of this Section 2.6.  For purposes hereof, (a) “FullyQualified Deck Checker” shall mean any deck checker which is included inthe Inventory and which is new, fully operational, in working order andsaleable, and (b) “Fully Qualified Shuffler” shall mean anyRandomPlus or ShufflePro shuffler which is included in the Inventory and whichis new, fully operational, in working order and saleable.  For purposes of this Section 2.6, thedetermination as to whether any deck checker or shuffler is 

###  

###  

### Page 10

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### fully operational, in working order and saleable shall be made inaccordance with the criteria set forth on Schedule 2.6 to this Agreement.

###  

### (b)    If, either (A) after completion of the Inventory Inspection,there remains any unresolved dispute between the Parties as to whether any deckchecker or shuffler is a Fully Qualified Deck Checker or Fully QualifiedShuffler, as applicable, and the parties are unable to resolve such disputewithin fifteen (15) days after meeting and negotiating in good faith to resolvesuch dispute or (B) any Party fails to cooperate in the InventoryInspection within the time frame set forth in Section 2.6(a) above(other than as a result of Suzo Happ’s failure to grant Buyer full access tothe Inventory at Suzo Happ during normal business hours following reasonablenotice by Buyer), then the Parties jointly shall promptly thereafter causeGaming Laboratories International, LLC (“GLI”)  to perform the relevant inspection or resolvesuch dispute in favor of Buyer or Seller. If GLI fails to agree to perform the relevant inspection within ten (10) daysof having been requested to do so or is unable to or refuses to perform therelevant inspection or resolve such dispute within thirty (30) days afteragreeing to do so, the Parties shall promptly cause BMM International (“BMM”)to perform the relevant inspection and resolve such dispute in favor of Buyeror Seller.  If BMM fails to agree toperform the relevant inspection within ten (10) days of having beenrequested to do so or is unable to or refuses to perform the relevantinspection or resolve such dispute within thirty (30) days after agreeing to doso, the Parties shall cause a mutually agreeable gaming testing firm to performthe relevant inspection or resolve such dispute (whichever of GLI, BMM or theother mutually agreed on firm that conducts the inspection or resolves thedispute is referred to herein as the “Inspection Firm”).  In the event either Party fails to jointlyretain the Inspection Firm as required herein for a period of ten (10) daysfollowing the request by the other Party to do so, then such requesting Partyshall be entitled to unilaterally take the actions required by this subsection (b) withrespect to such Inspection Firm.

###  

#### (i)         If either Party alone causes the Inspection Firm to performthe Inventory Inspection pursuant to subsection (b) above, such Partyshall deliver prompt written notice to the other Party (the “Receiving Party”)of the results of such inspection, together with a copy of the Inspection Firm’sreport (the “Inspection Notice”).

####  

#### (ii)        The cost of the any review by the Inspection Firm shall bepaid one-half by Seller and one-half by Buyer.

####  

### (c)    Subject to Buyer’s rights pursuant to Section 2.5(b)(iv)(B),upon the final determination of the Inventory Adjustment, either by the mutualagreement of the Parties or by determination of the Inspection Firm, theParties shall deliver joint written instructions to the Escrow Agent, suchinstructions to be prepared in accordance with the Escrow Agreement anddelivered within two (2) Business Days after the final determination, forpurposes of instructing the Escrow Agent:

###  

#### (i)         In the event the Inventory Adjustment is a positive netamount payable to Seller, to (A) pay to the Seller (1) a portion ofthe Additional Amount equal to the Inventory Adjustment and (2) the entireHoldback Amount, and (B) pay to Buyer an amount equal to the AdditionalAmount minus the Inventory Adjustment (provided such figure is a positivenumber);

####  

#### (ii)        In the event the Inventory Adjustment is a positive netamount payable to Buyer, to (A) pay to the Buyer (1) a portion of theHoldback Amount equal to the Inventory Adjustment (provided that if theInventory Adjustment exceeds the Holdback Amount, the Escrow Agent shall pay toBuyer the entire Holdback Amount, and Seller shall remain liable to Buyer forpayment of the portion of the Inventory Adjustment which exceeds the HoldbackAmount) and (2) the entire Additional Amount, and (B) pay to Selleran amount equal to the Holdback Amount minus the Inventory Adjustment (providedsuch figure is a positive number);

####  

####  

#### Page 11

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#### (iii)       In the event the Inventory Adjustment does not result in apositive net amount payable to either Buyer or Seller, to pay to the Seller theentire Holdback Amount and pay to the Buyer the entire Additional Amount; and

####  

#### (iv)       To deduct from all payments to be made to a Party pursuant tosubparts (i) though (iii) above all reasonable bank charges incurredby the Escrow Agent in connection with the payment to such Party.

####  

### (d)    The Parties agree that they will cooperate and assist in theconduct of the Inventory Inspection and any review by the Inspection Firm,including, without limitation, making available, to the extent necessary,books, records, work papers, test equipment and personnel and entering into anycommercial reasonable arrangement with the Inspection Firm.

###  

2.7  Service Contracts; Delivery ofAdditional Materials After Closing.

 

### (a)    From and after the Closing, Seller agrees to use its reasonableefforts to cause each distributor of any Products not to extend or renew anyservice contracts with any customers with respect to such Products beyond anysuch contract’s current expiration date without the prior written consent ofBuyer.  All such service contracts ofwhich Seller has Knowledge are set forth in Schedule 2.7(a).

###  

### (b)    The Buyer hereby acknowledges and agrees that:

###  

#### (i)         since January 1, 2009 and prior to the Closing Date,the Seller has sold and delivered certain Product finished goods to itscustomers or distributors, a list of such Product finished goods sold and thedelivery date thereof is set forth in Schedule 2.7(b) (collectively “RecentlySold Goods”); and

####  

#### (ii)        in respect of the Recently Sold Goods, the Seller is under acontractual obligation to provide a manufacturer’s product warranty ofservicing the same on those standard terms and conditions set forth inSchedule 4.17****andnotwithstanding anything to the contrary contained in this Agreement, anyperformance of its servicing obligations in accordance with the said productwarranty by the Seller after the Closing Date shall not constitute a breach bythe Seller of the Non-Compete Obligations of this Agreement or any infringementof Shuffler and DeckChecker Intellectual Property.

####  

### (c)    After the Closing, for no additionalconsideration, within a reasonable time after termination of Seller’sarrangement with Suzo Happ relating to the Products, Seller shall deliver oruse its reasonable efforts to cause to be delivered to Buyer (at Buyer’sexpense) all spare parts for any Products owned by Seller (save and except forthose spare parts which Seller has contractually agreed to provide to Suzo Happor allow Suzo Happ to retain possession and use pursuant to said terminationarrangement and a reasonable small quantity necessary for Seller to perform itsservicing obligations under the product warranty set forth under subsection (b)(ii) above)(collectively, the “Transferred Spare Parts”). All such TransferredSpare Parts shall be delivered to Buyer “as is, where is”; provided, however,that Seller hereby represents and warrants to Buyer that Seller will transfergood and marketable title to the Transferred Spare Parts, free and clear of anyLiens.

###  

### (d)    Within a reasonable time after the Closing, for no additionalconsideration, Seller shall deliver or use itsreasonable efforts to cause to be delivered to Buyer (at Buyer’sexpense) the following (if applicable and in existence): all tooling, diecastings, test fixtures and apparatuses, molds and equipment owned by Sellernecessary to the manufacture of the Products or any parts for the Products, andall related software owned by Seller necessary to the manufacture or operationof the Products or any parts for the Products, other than commercial “off theshelf” equipment available on standard terms. All such items delivered to Buyer 

###  

###  

### Page 12

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### pursuant to this subsection (d) shall bedelivered to Buyer “as is, where is”; provided, however, thatSeller hereby represents and warrants to Buyer that Seller will transfer goodand marketable title to such items, free and clear of any Liens.  Seller advises Buyer that such items are allsuch items in existence and in Seller’s possession or control but may not beall of the items necessary to manufacture the Products in the most economicalmanner.

###  

### (e)    If after the Closing Seller locates, obtains possession of oracquires (with or without consideration) from any distributor orsub-distributor, including, without limitation, Suzo Happ, any Product which isa Fully Qualified Shuffler or a Fully Qualified Deck Checker which has notbeen counted in determining the Inventory Adjustment (each an “AdditionalProduct”), then:

###  

#### (i)         if Seller has not received (or is not entitled to receive)the entire Holdback Amount and Additional Amount, Seller shall promptly deliver(or cause to be delivered) such Additional Product to Buyer and Buyer shall payto Seller the amounts determined as follows (the “Additional ProductAdjustment”):

####  

##### (A)       for each AdditionalProduct which is a Fully Qualified Shuffler, Buyer shall pay to Seller anamount in cash equal to Two Thousand Dollars ($2,000); and

#####  

##### (B)       for each AdditionalProduct which is a Fully Qualified Deck Checker, Buyer shall pay to Seller anamount in cash equal to Seven Thousand Five Hundred Dollars ($7,500);

#####  

##### provided, however,in no event shall the aggregate amount required to be paid by Buyer to Sellerpursuant to this Section 2.7(e) exceed the Maximum Additional ProductAdjustment.  For purposes hereof, “MaximumAdditional Product Adjustment” means an amount equal to (1) the sum ofthe Holdback Amount plus the Additional Amount minus (2) the amountof the Inventory Adjustment which Seller has received (or is entitled toreceive) pursuant to Section 2.6; or

####  

#### (ii)        if Seller has received (or is entitled to receive) the entireHoldback Amount and Additional Amount, then Seller shall promptly deliver (orcause to be delivered) such Additional Product to Buyer for no additionalconsideration.

####  

#### The Parties acknowledge and agree thatnothing contained in this Section 2.7(e) shall operate to modify anyrights or obligations of the Parties under Section 2.6 of this Agreement.

####  

####  

# **ARTICLE III**

# **[INTENTIONALLY OMITTED]**

#  

#  

# **ARTICLE IV**

# **REPRESENTATIONS AND WARRANTIES OFSELLER**

#  

Seller represents andwarrants to Buyer, as of the Closing Date, each of the following (with theunderstanding that any exception to any of the Seller’s representation orwarranties disclosed on any schedule referenced in this Article IV shallbe deemed disclosed with respect to any other schedule(s) referenced inthis 

 

 

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Article IV only to theextent the applicability of such exception to such other schedule(s) isreadily apparent on its face:

 

4.1            Organization and Corporate Power.  Seller is a corporation duly organized,validly existing and in good standing under the laws of Nevada.  Seller has all requisite power and authorityand all authorizations, licenses and permits necessary to own, operate andconduct Seller’s business as now conducted and as presently proposed to beconducted.

 

4.2            Authorization; No Breach.  The execution, delivery and performance bySeller of this Agreement and the Related Agreements and the consummation of theTransaction have been duly and validly authorized by all requisite corporateaction on the part of Seller, and no other corporate proceedings on the part ofSeller are necessary to authorize the execution, delivery or performance ofthis Agreement or the Related Agreements. No shareholder approval is required by Seller with respect to thisAgreement and the Related Agreements. The information set forth in Seller’s Form 10-Q for the periodending September 30, 2008 is true and correct as such information isapplicable to the determination that no such shareholder approval is required.  Each of the individuals executing thisAgreement and the Related Agreements on behalf of Seller, including WalterStowe, is a corporate officer of Seller and has been duly authorized to executethis Agreement and the Related Agreements on behalf of Seller. This Agreementand the Related Agreements to be executed and delivered by Seller constitutevalid and binding obligations of Seller, enforceable against the Seller inaccordance with their respective terms, subject to:  (i) laws of general application relatingto bankruptcy, insolvency and the relief of debtors; and (ii) rules oflaw governing specific performance, injunctive relief and other equitableremedies.  Except as disclosed inSchedule 4.2, the execution, delivery and performance of this Agreementand the Related Agreements and the consummation of the Transaction does not andshall not:  (i) conflict with orresult in any breach of any of the provisions of; (ii) constitute adefault under; (iii) result in a violation of; (iv) give any third partythe right to terminate or to accelerate any obligation under; (v) resultin the creation of any Lien upon any of the Acquired Assets or the Shuffler andDeckChecker Intellectual Property; or (vi) other than the filing to therelevant court for the mutual release of the Litigation, require anyauthorization, consent, approval, exemption or other action by or notice to orfiling with any court or other governmental or regulatory body or authority orany other Person (including, without limitation, any Lender), under theprovisions of Seller’s certificate of incorporation or bylaws or any indenture,mortgage, lease, loan agreement, license, contract, understanding, commitmentor other agreement or instrument to which Seller is bound or affected, or anyLaw to which Seller is subject.  Withoutlimiting the generality of the foregoing, except for this Agreement, and as maybe provided in any of the Related Agreements, there are no outstanding bindingagreements, options, commitments or rights entered into or granted by Sellerwith, of or to any Person to purchase or otherwise acquire any of the AcquiredAssets or any interests therein.

 

4.3            [INTENTIONALLY OMITTED].

 

4.4            [INTENTIONALLY OMITTED].

 

4.5            [INTENTIONALLY OMITTED].

 

4.6            [INTENTIONALLY OMITTED].

 

4.7            Liens.

 

There are no Liens on anyof the Acquired Assets, and no Person has the right, on any basis, to assertany Lien.

 

4.8            Acquired Assets.

 

### (a)    The Acquired Assets are all of the assets, whether tangible orintangible (other than Excluded Assets), owned by Seller that are used in ornecessary for the manufacture of the Products, other than 

###  

###  

### Page 14

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### the Excluded Assets and the standard “off theshelf” non-Product specific property, such as furniture and computers.

###  

### (b)    Seller owns good and marketable title to each of the AcquiredAssets, free and clear of any Liens.  Nothird Person owns any rights in or to any Acquired Asset, including anyShuffler and DeckChecker Intellectual Property. Without limiting the generality of the foregoing, each Lender hasterminated any and all Liens which such Lender had or may have had on anyAcquired Asset.

###  

### (c)    The Shuffler and DeckChecker Intellectual Property are all of theIntellectual Property owned by Seller:  (x) usedin, or a part of, the conduct of that portion of Seller’s business involving orrelating to the Acquired Assets as currently conducted by Seller and (y) whichare claimed by Seller to cover any of the Products.

###  

### (d)    All Products installed in any Legal Gaming Venue as of theClosing Date have been sold to a third party, and there are no leases, licensesor “free trial” arrangements with respect to any such Products.

###  

### (e)    As of the Closing Date, there are no products of that portion ofSeller’s business involving or relating to the Acquired Assets on a “freetrial,” except as disclosed in Schedule 4.8(e).

###  

### (f)    As of the Closing Date, there are no pending orders received bythe Seller for any Product.

###  

### (g)    None of TCS, Suzo Happ, Ten Stix or any of their respectivesubsidiaries or Affiliates currently has or claims to have any right to sell ordistribute, or act as a distributor, representative or agent of Seller or anyof Seller’s Affiliates with respect to, any of the Products.

###  

4.9            [INTENTIONALLY OMITTED]

 

4.10          [INTENTIONALLY OMITTED]

 

4.11          Tax Matters.

 

Except as disclosed inSchedule 4.11, Seller has timely filed all federal, state, local andforeign income, information and other Tax returns which are required to befiled under applicable legal requirements with respect to any of the AcquiredAssets; each of same are true, complete and accurate in all material respects; and all sales Taxes and all othermaterial Taxes, assessments and other governmental charges imposed upon Sellerwith respect to any Acquired Asset have been timely paid.

 

4.12          Contracts and Commitments.

###  

### (a)    There are no amounts due or payable by Seller or any of itsAffiliates with respect to any Acquired Asset accruing prior to the ClosingDate, and Seller agrees to pay, when and as due, all amounts due and payable bySeller or any of its Affiliates with respect to any Acquired Asset accruingprior to the Closing Date, including without limitation:

###  

#### (i)         any contract with any labor union or any bonus, pension,profit sharing, retirement or any other form of deferred compensation plan orany stock purchase, stock option or similar plan;

####  

#### (ii)       any management agreement or contract for the employment of anyofficer, partner, individual employee or other person;

####  

#### (iii)       any agreement or indenture (including with any Lender)relating to Indebtedness or to placing a Lien on any Acquired Asset; and

####  

#### (iv)       any lease or license agreement under which Seller is lessor orlicensor of any Acquired Asset.

####  

####  

#### Page 15

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### (b)    Except as disclosed in Schedule 4.12(b) or as provided inthis Agreement, there are no contracts or agreements entered into by Seller orany of its Affiliates, whether formal or informal, written or oral, currentlyin effect, or with any remaining obligations to Seller of any kind:

###  

#### (i)         which prohibits Seller from freely engaging in businessrelating to any Acquired Assets anywhere in the world;

####  

#### (ii)        relating to the marketing, sale, distribution, production,advertising or promotion of any Acquired Asset;

####  

#### (iii)       under which Seller is obligated to indemnify any third partyagainst any Product warranty, infringement or similar claims;

####  

#### (iv)       relating to or constituting a power of attorney executed by oron behalf of Seller relating to any Acquired Asset;

####  

#### (v)        that creates any existing or future, or potentialIndebtedness of Seller on an Acquired Asset (including any Indebtedness to anyLender);

####  

#### (vi)       with TCS, Suzo Happ, Ten Stix or any of their respectivesubsidiaries or Affiliates, or any distributor, representative or agent withrespect to any of the Products;

####  

#### (vii)      which allows or grants any rights to any Person for themanufacture, marketing, sale, distribution, production, advertising orpromotion of any Acquired Asset;

####  

#### (viii)     which creates any joint venture orpartnership regarding any Acquired Asset;

####  

#### (ix)       which affects Seller’s legal title in the Shuffler andDeckChecker Intellectual Property;

####  

#### (x)        which is a beta test agreement; or

####  

#### (xi)       which relates to the research and development of any AcquiredAsset.

####  

(c)    Except as disclosed in Schedule 4.12(c),with respect to any Acquired Asset:

(i)         no contract or commitment has beenbreached in any material respect or cancelled by the other party thereto (otherthan contracts or commitments which have been terminated without any furtherliability or obligation on the part of any party thereto);  

#### (ii)        Seller and each of its Affiliates have performed allobligations under any contract currently in effect required to be performed bySeller or any of its Affiliates and there is no material breach of or defaultunder any currently in effect lease, contract, commitment or other agreement towhich Seller or any of its Affiliates is a party.

####  

### (d)    The termination by Seller or any of its Affiliates or expirationof any contract or agreement of Seller or any of its Affiliates, whether formalor informal, written or oral, currently in effect, concerning any AcquiredAsset, will not constitute a breach of said contract or agreement, nor resultin any liability to Seller or any of its Affiliates.

###  

### (e)    Seller has provided to Buyer true, correct and complete copies ofall non-disclosure agreements to which Seller or any of its Affiliates is aparty regarding any trade secret or computer code concerning any Acquired Asset(other than any such non-disclosure agreement with Buyer).

###  

###  

### Page 16

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4.13          Shuffler and DeckCheckerIntellectual Property.

### (a)    Schedule 4.13(a) sets forth a complete and correct listof all Shuffler and DeckChecker Intellectual Property, including, byjurisdiction, all Patents and Trademarks.

###  

### (b)    Except as disclosed on Schedule 4.13(b) or theapplicable schedule indicated below:

###  

#### (i)         Seller owns and possesses all right, title and interest inand to all of the Shuffler and DeckChecker Intellectual Property;

####  

#### (ii)        The Shuffler and DeckChecker Intellectual Property is notsubject to any Liens, existing or threatened, and further, is not subject toany restrictions or limitations regarding use or disclosure;

####  

#### (iii)       Except with respect to the claims of Buyer (the validity ofwhich Seller does not admit): neither Seller nor any of its Affiliates hasinfringed, misappropriated or otherwise conflicted with, any IntellectualProperty of a third party in Seller’s or its Affiliates’ operation orcommercialization of its business relating to or involving the Acquired Assetsor in its or their sale, leasing, licensing or other exploitation of anyAcquired Asset; no Product infringes any Intellectual Property of a thirdparty, and no third party has made any such claim; to the best of Seller’sKnowledge, there are no facts that indicate a likelihood of any of theforegoing; and neither Seller nor any of its Affiliates has received anynotices regarding any of the foregoing (including, without limitation, anydemands or offers to license any Intellectual Property from any third party);

####  

#### (iv)       Seller has taken all necessary and reasonable actions tomaintain and protect all of the Shuffler and DeckChecker Intellectual Property;

####  

#### (v)        To the best of Seller’s Knowledge, no third party hasinfringed, misappropriated or otherwise conflicted with any of the Shuffler andDeckChecker Intellectual Property, and to the best of Seller’s Knowledge, thereare no facts that indicate a likelihood of any of the foregoing;

####  

#### (vi)       To the best of Seller’s Knowledge, each of the claims in eachof the Patents is valid and enforceable in the jurisdiction in which theparticular Patent is issued or registered, and, to the best of Seller’sKnowledge, will be valid and enforceable in such jurisdiction where any suchPatent is filed, but not yet issued or registered, upon issuance andregistration of such Patent; and none of the Shuffler and DeckCheckerIntellectual Property, to the best of Seller’s Knowledge, has been misused, noclaim by any third party contesting the validity, enforceability, use orownership of any of same has been made, is currently outstanding or isthreatened, and there are no grounds for the same;

####  

#### (vii)      To the best of Seller’s Knowledge, each of the Trademarks isvalid and enforceable in the jurisdiction in which the particular Trademark isissued or registered;

####  

#### (viii)     No loss or expiration of any of theShuffler and DeckChecker Intellectual Property is pending or, to the Knowledgeof Seller, threatened, except for patents expiring at the end of theirstatutory terms (and not as a result of any act or omission by the Seller,including, without limitation, a failure by Seller to pay any requiredmaintenance fees);

####  

#### (ix)       Neither Seller nor any of its Affiliates has agreed toindemnify any third party for or against any interference, infringement,misappropriation or other conflict with respect to any Shuffler and DeckCheckerIntellectual Property;

####  

#### (x)        Seller has obtained the proper execution of all inventors soas to vest full and complete title to Seller of all Shuffler and DeckCheckerIntellectual Property, and other than employees of Seller and consultants whohave assigned all code, underlying copyrights and other Intellectual Property toSeller, no Person has provided software coding or design work for any of theProducts except as disclosed on Schedule 4.13(b)(x);

####  

####  

#### Page 17

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#### (xi)       Neither Seller nor any of its Affiliates has disclosed any ofits trade secrets or other Confidential Information to any third party otherthan pursuant to a written, and to the best of Seller’s Knowledge, valid andbinding confidentiality agreement;

####  

#### (xii)      Seller has not licensed or granted a covenant not to sue respectingany Shuffler and DeckChecker Intellectual Property, except as disclosed onSchedule 4.13(b)(xii);

####  

#### (xiii)     Within the last three (3) years,neither Seller nor any of its Affiliates has transferred or licensed any of theShuffler and DeckChecker Intellectual Property to any other Person;

####  

#### (xiv)     Neither Seller nor any of its Affiliates has granted any thirdparty any rights to currently possess, access or use any source code relatingto any of the Products;

####  

#### (xv)      To the best of Seller’s Knowledge, none of the followingdocumentation exists with respect to any Patent:

####  

##### (A)       Validity studies; or

#####  

##### (B)       Novelty studies; and

#####  

#### (xvi)     To the best of Seller’s Knowledge, none of the followingdocumentation exists with respect to any Product other than the Poker Oneshuffler:

####  

##### (A)       Clearance studies; or

#####  

##### (B)       Infringement studies.

#####  

#####  

### (c)  All claims of “small entity”status made by Seller in connection with any filings of or relating to thePatents were made by Seller in good faith.

###  

4.14      Litigation.  Except for the Litigation:  (a) there are no (and, during the twoyears preceding the Closing Date, there have not been any) actions, suits,proceedings, orders or investigations pending or, to the best of Seller’sKnowledge, threatened that (i) challenge Seller’s ownership of theAcquired Assets , (ii) could result in any rescission of (A) Seller’sownership of the Acquired Assets or (B) the transfer of the AcquiredAssets to Buyer or (iii) challenge the validity or enforceability of anyof the Shuffler and DeckChecker Intellectual Property, in each case at law orin equity, or before or by any federal, state, municipal or other governmentaldepartment, commission, board, bureau, agency or instrumentality, domestic orforeign; and (b) to the best of Seller’s Knowledge, there is no reasonablebasis for any of the foregoing.  NeitherSeller nor any of its Affiliates is subject to or bound by any outstandingorders, judgments or decrees of any court or governmental entity with respectto any of the Acquired Assets or any of the Shuffler and DeckCheckerIntellectual Property.  Neither Sellernor any of its Affiliates has received any opinion or memorandum or advice fromlegal counsel to the effect that Seller is exposed, from a legal standpoint, toany material liabilities affecting any of the Acquired Assets or any of theShuffler and DeckChecker Intellectual Property. To the best of Seller’s Knowledge, there are no actual or potentialclaims, or any basis therefor, by Seller or any Affiliate of Seller againstBuyer or any Affiliate of Buyer, other than claims in respect of sales ofproducts made and contractual obligations entered into between Seller or one ormore of its Affiliates and Buyer or one or more of its Affiliates.  Neither Seller’s current litigation with (i) Purtonor (ii) Lombino challenge Seller’s ownership of the Acquired Assets or thevalidity or enforceability of nor seek rescission or return of any Products orShuffler and DeckChecker Intellectual Property from Seller.

 

 

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** **

4.15          Brokerage.  There are and will be no claims for brokeragecommissions, finders’ fees or similar compensation in connection with theTransaction, based on any arrangement or agreement made by or on behalf ofSeller.

 

4.16          [INTENTIONALLY OMITTED].

 

4.17          Product Warranties. Seller hereby makes no express or implied warranties or guarantees withrespect to any of the Products marketed, leased and/or sold or servicesrendered by it, except for:  (i) thosestandard terms and conditions in Schedule 4.17; (ii) those ofownership free and clear of any Liens; (iii) the ability to transfer anyof same as part of the Transaction; and (iv) that each Product sold ordelivered and each service rendered by Seller has been in conformity in allmaterial respects with all applicable contractual commitments; and Seller hasno material liability or obligation for replacement or repair thereof or otherdamages in connection therewith.  Since September 1,2007, there have been no recalls, withdrawals or seizures with respect to anyProducts marketed or sold by Seller in connection with its business.

 

4.18          [INTENTIONALLY OMITTED].

 

4.19          Compliance with Laws.  Except as disclosed, as required herein, onSchedule 4.19:

 

### (a)    Seller has complied and is in compliance in all material respectswith all applicable Laws relating to the operation of that portion of itsbusiness involving or relating to the Acquired Assets and the manufacture andselling of any Acquired Asset.  The Productsand their manufacture and sale are and have been in compliance in all materialrespects with all applicable Laws, and no notices have been received by and, tothe best of Seller’s Knowledge, no claims have been filed against Selleralleging a violation of any such Laws;

###  

### (b)    Seller has not received any notice, report or informationregarding any actual or alleged violation of, or any liability or potentialliability arising under any Law that relates, covers or applies to the AcquiredAssets; and

###  

### (c)    No officer, director, employee, consultant, advisor or agent ofSeller has been or is authorized to make or receive, and Seller does not knowof any of its officers, directors, employees, consultants, advisors or agentsmaking or receiving, any bribe, kickback payment or other illegal payment atany time with respect to any Acquired Assets.

###  

4.20          [INTENTIONALLY OMITTED]

 

4.21          Suppliers.

 

Schedule 4.21 sets forth a list of Seller’ssuppliers for the deck checkers, including, with respect to each such supplier,a list of all parts which such supplier supplies to Seller.

 

4.22          Inventory.

 

### (a)    To the Knowledge of Seller, all of the Inventory is listed inSchedule 4.22(a), including location and serial number.  The number of RandomPlus and Shuffle Proshufflers and deck checkers set forth on Schedule 4.22(a) is true andcorrect.

###  

### (b)    No Person other than Seller and Suzo Happ (including, withoutlimitation, Ten Stix) is in possession of or has any right to sell, whether asa distributor, representative, agent or otherwise, any of the Products.

###  

### (c)    Schedule 4.22(c) sets forth a true, correct and completelist of all Persons who, to the Knowledge of Seller, hold any tooling, diecastings, or molds necessary to manufacture the Products or any parts 

###  

###  

### Page 19

** **

### for the Products.  To the Knowledge of Seller, no Persons otherthan those listed on Schedule 4.22(c) hold any such toolings, die castingsor molds.

###  

### (d)    Except as disclosed in Schedule 4.22(d), all Inventory has beenmanufactured in conformity with all applicable Laws.  Seller owns all Inventory, free and clear ofany Liens.

###  

4.23          Product Liabilities.  Except as disclosed in Schedule 4.23,Seller has not had and does not have any liability (and, to the best of Seller’sKnowledge, there is no reasonable basis for any present or future action, suit,proceeding, hearing, investigation, charge, complaint, claim or demand againstit giving rise to any liability) arising out of any injury to individuals orproperty as a result of the ownership, possession or use of any Products .

 

4.24          Insolvency.

 

As of the Closing Date,Seller is not presently insolvent and does not presently intend to take anyaction to cause, effectuate or authorize any of the following, whethervoluntary or involuntary, within the four (4) year period following theClosing Date: (a) any bankruptcy, reorganization, insolvency, liquidation,receivership, dissolution, foreclosure, winding up or relief from indebtedness,whether in a case, action or proceeding before any court or governmental entity(including any proceeding under the United States Bankruptcy Code) orotherwise; (b) any general assignment for the benefit of creditors,composition, marshalling of assets for creditors or other similar arrangementin respect of Seller’s creditors generally or any portion of such creditors; or(c) any transfer of all or substantially all of Seller’s assets to anyPerson.  There is no basis for anyAffiliate of Seller to cause, take any action to effectuate or authorize any ofthe foregoing or to foreclose on any of Seller’s assets.

 

4.25          Disclosure.  This Agreement does not contain any untruestatement of a material fact or omit a material fact necessary to make thestatements contained herein or therein, in light of the circumstances in whichthey were made, not misleading.  Despiteany input from Buyer, each Schedule was prepared solely by Seller, and Selleris fully and solely responsible for the content of each.

 

4.26          Knowledge.  As used herein, the term “Knowledge”means the actual state of knowing a thing or fact.

 

4.27          Allocation of Risks.  The representations, warranties, covenantsand agreements made herein, together with the indemnification provisions inthis Agreement, are intended among other things to allocate the economic costand the risks inherent in the Transaction and accordingly, a party shall beentitled to the indemnifications or other remedies provided in this Agreementby reason of any breach of any such representation, warranty, covenant oragreement by another party notwithstanding whether any employee, representativeor agent of the party seeking to enforce such indemnification or any remedyknew or had reason to know of such breach, and any such knowledge or reason toknow of such breach shall not be a defense to any indemnification, or otherclaims, remedies, or defenses.

 

4.28          Modifications.  All representations, warranties and covenantsmade by Seller herein in relation to the Products and the Shuffler andDeckChecker Intellectual Property shall not extend to any modifications, updatesor adjustments made by Buyer or any of its Affiliates or agents after theClosing Date to the extent such modification, update or adjustment caused suchrepresentation, warranty or covenant to no longer be true.

 

 

Page 20

# ** **

**ARTICLEV**

# **[INTENTIONALLY OMITTED]**

#  

**ARTICLEVI**

# **REPRESENTATIONS ANDWARRANTIES OF BUYER**

#  

As an inducement to Sellerto enter into this Agreement, Buyer hereby represents and warrants to Seller asof the date hereof and as of the Closing Date as follows:

 

6.1            Corporate Organization and Power.  Buyer is a corporation duly formed andvalidly existing under the laws of the State of Minnesota, with full corporatepower and authority to enter into this Agreement and to perform its obligationshereunder.

 

6.2            Authorization.  The execution, delivery and performance ofthis Agreement and the Related Agreements to be executed and delivered by Buyerand the consummation of the Transaction have been duly and validly authorizedby all requisite corporate action on the part of Buyer, and no other corporateproceedings on the part of Buyer are necessary to authorize the execution,delivery or performance of this Agreement or the Related Agreements.  No action by the board of directors of Buyeris necessary to authorize the execution, delivery or performance by Buyer ofthis Agreement or the Related Agreements. This Agreement and the Related Agreements contemplated hereby to beexecuted and delivered by Buyer constitute valid and binding obligations ofBuyer, enforceable against Buyer in accordance with their respective terms.

 

6.3            Governmental Authorities andConsents.  Buyer is not required tosubmit any notice, report or other filing with any governmental authority inconnection with the execution or delivery by it of this Agreement or theconsummation of the Transaction and no consent, approval or authorization ofany governmental or regulatory authority is required to be obtained by Buyer inconnection with the execution and delivery of this Agreement or theconsummation of the Transaction.

 

6.4            Brokerage.  There are no claims for brokeragecommissions, finders’ fees or similar compensation in connection with thetransactions contemplated by this Agreement based on any arrangement oragreement made by or on behalf of Buyer.

 

6.5            Claims.  Except for the Litigation, to the knowledgeof Buyer, there are no actual or potential claims by Buyer or any Affiliate ofBuyer against Seller or any Affiliate of Seller, other than claims in respectof sales of products made and contractual obligations entered into betweenBuyer or one or more of its Affiliates and Seller or one or more of itsAffiliates.

 

 

**ARTICLEVII**

# **ADDITIONAL AGREEMENTS**

 

7.1            Survival of Representations andWarranties.  The representations andwarranties in this Agreement and the Schedules attached hereto shall survivethe Closing, as follows:

 

### (a)       any representations and warranties respecting any Tax Mattersshall terminate when the applicable statutes of limitations with respect to theliabilities in question expire (giving effect to any extensions or waiversthereof);

###  

### (b)       any representations and warranties in Sections 4.1(Organization and Corporate Power), 4.2 (Authorization; No Breach), 4.7(Liens), 4.8 (Acquired Assets), 4.12 (Contracts and Commitments), 4.13 

###  

 

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###  

### (Shuffler and DeckChecker Intellectual Property), 4.15 (Brokerage),4.24 (Insolvency), 4.26 (Knowledge) and 4.27 (Allocation of Risks) shallterminate on the third anniversary of the Closing Date;

###  

### (c)    notwithstanding subsection (b) of this Section 7.1, anyrepresentations and warranties of Seller relating to any Lender (together withthe representations and warranties described in subsection (b), the “FundamentalReps”) shall terminate on the day after the expiration of the applicablestatute of limitations; and

###  

### (d)    all other representations and warranties in this Agreement shallterminate on the first anniversary of the Closing Date, provided that anyrepresentation or warranty in respect of which indemnity may be sought under Section 7.2,shall survive the time at which it would otherwise terminate pursuant to this Section 7.1if written notice of the claim for indemnification shall have been given to theParty against whom such indemnity may be sought prior to such time.  The representations and warranties in thisAgreement and the Schedules attached hereto shall survive for the periods setforth in this Section 7.1 and shall in no event be affected by anyinvestigation, inquiry or examination made for or on behalf of Buyer or Seller,or the Knowledge of any of Buyer’s or Buyer’s officers, directors,shareholders, employees or agents or the acceptance by Buyer or Seller of anycertificate or opinion hereunder.  Sellermakes no representations or warranties other than set forth in this Agreementand in the Schedules, and in any Related Agreement.  Each of the Seller and the Buyer makes norepresentations or warranties other than set forth in this Agreement.

###  

### 7.2              General Indemnification.

###  

### (a)  Indemnification by Seller for Benefit of Buyer. Sellerhereby fully indemnifies and holds harmless Buyer, Buyer’s officers, directors,heirs, employees, agents, representatives, successors and assigns, and each ofits and their respective officers, directors, heirs, employees, agents,representatives, successors and assigns and Buyer’s Affiliates (collectively, “BuyerIndemnitees”), and save, defend and hold each of the Buyer Indemniteesharmless against and pay on behalf of or reimburse such Buyer Indemnitees asand when incurred for any Losses (including, without limitation, Seller’spayment, when otherwise due by any Buyer Indemnitee, of any of Buyer Indemnitee’sattorneys’ fees or legal costs) which any such Buyer Indemnitee may suffer,sustain, have alleged against it, or become subject to, as a result of, inconnection with, relating or incidental to by virtue of, arising out of, orfrom:  (i) any breach of anyrepresentation or warranty made by Seller in or under this Agreement, anyRelated Agreement, or any of the Schedules attached hereto or thereto; (ii) anynonfulfillment or breach of any covenant, obligation, or agreement by Sellerunder or in this Agreement, any Related Agreement, or any of the Schedulesattached hereto or thereto; (iii) any liability or obligation of Seller orany Loss related thereto arising from any Excluded Liability or Excluded Asset,including, without limitation, any liability or obligation (or any Loss relatedthereto) to, or any Lien asserted or claimed by, any Lender; (iv) any breachor noncompliance by Seller of Section 8.13 hereof; (v) anyIndebtedness, Loss or right claimed by any of TCS, Suzo Happ, Ten Stix, Purtonor Lombino against Seller or against Buyer in connection with this Agreement,the transactions contemplated hereby and/or the actions, omissions oragreements of Seller (other than with respect to Buyer’s actions or omissionsin picking up the Inventory from Suzo Happ pursuant to Section 2.5(b)(iv)(B));(vi) any Indebtedness or Loss suffered or alleged against Buyer or anyBuyer Indemnitee attributable to any act or omission of Seller occurring priorto the Closing Date, including, without limitation, with respect to any Lender;and (vii) any action, claim or Indebtedness or Loss alleged by Seller orany Affiliate of Seller against Buyer or any Affiliate of Buyer which existedas of the Closing Date, whether known or unknown, accrued or unaccrued, orliquidated or unliquidated (other than with respect to any breach of thisAgreement or any Related Agreement by Buyer or products sold or purchased bySeller or any Affiliate of Seller to or from Buyer or any Affiliate of Buyer inthe ordinary course of business or contractual relationships between suchparties).  (The items in (i) through(vii) are individually and collectively referred to herein as a “BuyerIndemnitee Claim”).  Seller shall not have the right to deny indemnificationcoverage under this Agreement to Buyer or its Affiliates based on the mere factthat Buyer or an Affiliate of Buyer manufactured, sold, leased, licensed,marketed, distributed or used any Acquired Asset (in the same condition asexisted as of 

###  

 

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###  

### the Closing) in compliance with theapplicable (if any) Gaming Permits and/or Gaming Product Approvals, afterClosing.

###  

### (b)    Indemnification by Buyer for Benefit of Seller.  Buyer hereby fully indemnifies and holdsharmless Seller, Seller’s officers, directors, heirs, employees, agents,representatives, successors and assigns, and each of its and their respectiveofficers, directors, heirs, employees, agents, representatives, successors andassigns and Seller’s Affiliates (collectively “Seller Indemnitees”) andsave, defend and hold each of the Seller Indemnitees harmless against and payon behalf of or reimburse such Seller Indemnitees as and when incurred for anyLosses (including, without limitation, Buyer’s payment, when otherwise due byany Seller Indemnitee, of any of Seller Indemnitee’s attorneys’ fees or legalcosts) which any such Seller Indemnitee may suffer, sustain, have allegedagainst it , or become subject to, as a result of, in connection with, relatingor incidental to by virtue of, arising out of, or from:  (i) any breach of any representation orwarranty of Buyer in or under this Agreement, any Related Agreement, or any ofthe Schedules attached hereto or thereto; (ii) any nonfulfillment orbreach of any covenant, obligation or agreement by Buyer under or in thisAgreement, any Related Agreement, or any of the Schedules attached hereto orthereto; (iii) any Indebtedness or Loss of Seller or any of Seller’sAffiliates, with respect to any Acquired Asset or Buyer’s conduct of itsbusiness relating to the Acquired Assets, which arises from an act oromission of Buyer occurring after the Closing Date (other than anyExcluded Liability and any Indebtedness or Loss resulting from any breach, orwhich would constitute a breach, by Seller or its Affiliates of thisAgreement), including, without limitation, any Indebtedness (or any Lossrelated thereto) to, or any Lien asserted or claimed by, any creditor of Buyerregarding an Acquired Asset; and (iv) any action, claim or Indebtednessalleged by Buyer or any Affiliate of Buyer against Seller or any Affiliate ofSeller which existed as of the Closing Date, whether known or unknown, accruedor unaccrued, or liquidated or unliquidated (other than with respect to anybreach of this Agreement or any Related Agreement by Seller or products sold orpurchased by Buyer or any Affiliate of Buyer to or from Seller or any Affiliateof Seller in the ordinary course of business or contractual relationshipsbetween such parties) (the items in (i), (ii), (iii) and (iv) areindividually and collectively referred to herein as a “Seller IndemniteeClaim”).  Buyershall not have any indemnification obligation under this Agreement, and neitherSeller nor any Affiliate of Seller shall be entitled to any indemnificationcoverage under this Agreement, based on the mere fact that Buyer or anAffiliate of Buyer manufactured, sold, leased, licensed, marketed, distributedor used any Acquired Asset (in the same condition as existed as of the Closing)in compliance with the applicable (if any) Gaming Permits and/or Gaming ProductApprovals, after Closing.

###  

### (c)    Defense of Claims. Any Party making a claim for indemnification under this Section 7.2(an “Indemnitee”) shall notify the indemnifying Party (an “Indemnitor”)of the claim in writing and, if by a third party, promptly after receivingwritten notice of any action, lawsuit, proceeding, investigation or other claimagainst it; and, in all events, describing the claim, the amount thereof (ifknown and quantifiable), and the basis thereof; provided that thefailure to so notify an Indemnitor shall not relieve the Indemnitor of its obligationshereunder except to the extent that (and only to the extent that) such failureshall have caused the damages for which the Indemnitor is obligated to begreater than such damages would have been had the Indemnitee given theIndemnitor prompt notice hereunder.  AnyIndemnitor shall defend such action, lawsuit, proceeding, investigation orother claim giving rise to an Indemnitee’s claim for indemnification at suchIndemnitor’s expense, and (subject to the limitations set forth below) shallassume the defense thereof by appointing an AV-rated counsel experienced in thesubject matter of such claim and reasonably acceptable to the Indemnitee to bethe lead counsel in connection with such defense; providedfurther,that:

###  

#### (i)         the Indemnitee shall be entitled to participate in thedefense of such claim and to employ counsel of its choice for such purpose;provided that, as long as the Indemnitor is defending, at its sole cost, andpaying, currently and as incurred, all legal fees and litigation costs andexpenses of the Indemnitee, the fees and expenses of such separate counselshall be borne by the Indemnitee; but further, if Indemnitor is in breach ofany provision of Section 7.2(c), then, notwithstanding any otherprovisions contained in this Agreement, 

####  

 

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####  

#### the Indemnitee shall have the right tocontrol the defense and settlement of such claim, with counsel of its ownchoosing, and all at Indemnitor’s sole expense;

####  

#### (ii)        the Indemnitor shall not be entitled to assume control ofsuch defense and shall, as incurred by the Indemnitee, pay the legal fees andlitigation expenses of counsel retained by the Indemnitee if:  (A) the claim for indemnificationrelates to or arises in connection with any criminal proceeding, action,indictment, allegation or investigation; (B) the Indemnitee reasonablybelieves an adverse determination with respect to the action, lawsuit,investigation, proceeding or other claim giving rise to such claim forindemnification would be detrimental to or injure the Indemnitee’sreputation,   future business prospects,or any regulatory licenses, Gaming Permits, or Gaming Product Approvals; (C) theclaim seeks an injunction or equitable relief against the Indemnitee; (D) uponpetition by the Indemnitee, the appropriate court rules that theIndemnitor failed or is failing to vigorously prosecute or defend such claim; (E) theIndemnitee reasonably believes that the Loss relating to such claim forindemnification could exceed the maximum amount that such Indemnitee could thenbe entitled to recover under the applicable provisions of Section 7.2; or (F) theIndemnitor is not in full compliance with each condition set forth in Section 7.2(c)(i) through7.2(c)(iv);

####  

#### (iii)       if the Indemnitor shall control the defense of any such claim,the Indemnitor shall obtain the prior written consent of the Indemnitee beforeentering into any settlement of a claim or ceasing to defend such claim if,pursuant to or as a result of such settlement or cessation:  (A) there is any risk or jeopardy to anyGaming Permit or Gaming Product Approval held by the Indemnitee; (B) injunctiveor other equitable relief will be imposed against the Indemnitee; (C) suchsettlement does not expressly, finally and unconditionally release theIndemnitee from all liabilities and obligations with respect to such claim,without any prejudice to the Indemnitee; (D) such settlement involves theIndemnitee relinquishing, limiting, or reducing any of its rights under thisAgreement or any Related Agreement; (E) any settlement adversely affectsthe economic value of any of the Acquired Assets or the operation thereof, orany other part of any Intellectual Property owned by Buyer; or (F) thesettlement requires any payment by the Indemnitee; and

####  

#### (iv)       so long as an Indemnitor is not in breach of this Section 7.2(c),then the Indemnitor shall not be obligated hereunder for any settlement enteredinto by an Indemnitee without the Indemnitor’s prior written consent, whichconsent shall not be unreasonably withheld. In any event, Buyer shall be entitled to settle any claim at its ownexpense.

####  

### (d)    With respect to any Buyer Indemnitee Claim, Seller’s maximumaggregate indemnification obligations for any of Buyer’s Losses under this Section 7.2(the “Seller’s Cap”) shall be the Purchase Price; provided, however,that any attorneys’ fees, court costs, or other litigation expenses related toany Buyer Indemnitee Claim shall be excluded from and not part of the Seller’sCap.

###  

### (e)    With respect to any Seller Indemnitee Claim, Buyer’s maximumindemnification obligations for any of Seller’s Losses shall be $1.0 million(the “Buyer’s Cap”), provided, however, that any attorneys fees, courtcosts or other litigation expenses related to any Seller Indemnitee Claim shallbe excluded from and not part of the Buyer’s Cap.

###  

### (f)    A Buyer Indemnitee shall not be entitled to indemnification underSection 7.2(a)(i) unless the aggregate of all of Seller’sindemnification obligations under Section 7.2(a)(i) exceeds TwentyThousand Dollars ($20,000.00) (the “Deductible”); but in such event, theBuyer Indemnitees shall be entitled to indemnification in full for all claimsunder Section 7.2(a)(i); provided, however, that Sellershall not be entitled to the benefit of the Deductible with respect to anybreach of any Fundamental Rep or to the extent any breach of a representationor warranty involved actual fraud.  Inthe event that an indemnification claim could be made by Buyer under both Section 7.2(a)(i) andany other subsection of Section 7.2(a), for the avoidance of doubt, Sellershall not be entitled to the benefit of the Deductible with respect to suchclaim.

###  

 

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###  

### (g)    A Seller Indemnitee shall not be entitled to indemnificationunder Section 7.2(b)(i) unless the aggregate of all of Buyer’sindemnification obligations under Section 7.2(b)(i) exceeds theamount of the Deductible; but in such event, the Seller Indemnitees shall beentitled to indemnification in full for all claims under Section 7.2(b)(i);provided, however, that Buyer shall not be entitled to thebenefit of the Deductible to the extent any breach of a representation orwarranty involved actual fraud.  In theevent that an indemnification claim could be made by Seller under both Section 7.2(b)(i) andany other subsection of Section 7.2(b), for the avoidance of doubt, Buyershall not be entitled to the benefit of the Deductible with respect to suchclaim.

###  

### (h)    If a Party is liable or responsible for a Loss, the Loss shallalso accrue interest at the Applicable Rate, beginning when the Loss is due tobe paid to the other Party, and continuing until paid in full.

###  

### (i)     No Party shall have the right to rescind this Agreement.

###  

###  

7.3              Press Release and Announcements. After the Closing, the Parties shallissue a joint press release in the form attached hereto as Exhibit Bwithin the time period required by applicable Laws.  As required by any applicable Laws, each ofBuyer and Seller shall be permitted to issue its own related filings regardingthe Closing of the Transaction provided that the text of such filings are, tothe extent permitted by applicable Laws, not inconsistent with the joint pressrelease and that each Party shall not make any adverse comment or disparagementabout the Acquired Assets or the other Party’s business or products in its ownrelated filings.  Notwithstanding theforegoing or anything in this Agreement to the contrary, neither Party shallissue a press release containing any allocation of the consideration relatingto the Transaction, except that such allocation may be reflected in anyfinancial statements included with any such press release.

 

7.4              Expenses.  Except as otherwise expressly provided in Section 7.5below, each Party hereto shall pay all of its own costs and expenses (includingattorneys’, accountants’ and investment bankers’ fees and other out-of-pocketexpenses) in connection with the negotiation and execution of this Agreement,the performance of its obligations hereunder and the consummation of theTransaction.  Without limiting theforegoing, each Party shall pay its own expenses incurred in connection withits efforts to satisfy the conditions to the other Party’s obligation toconsummate the Transaction.

 

7.5              Further Transfers.  Both prior to and after Closing, Seller shallexecute and deliver such further instruments of conveyance and transfer andtake such additional action (including without limitation, all documentsdescribed or required under Section 2.5(b)) as Buyer may reasonablyrequest to effect, consummate, confirm or evidence the transfer, ascontemplated by this Agreement, to Buyer of the Acquired Assets (including withrespect to the transference of all Gaming Product Approvals, authorizations,accreditations and consents, if any, in connection therewith), and Seller shallexecute such documents as may be necessary to assist Buyer in preserving orperfecting its rights (including ownership) in the Acquired Assets(collectively “Instruments of Conveyance”).  Seller hereby designates Buyer as Seller’sattorney in fact and law for the purposes of executing any Instruments ofConveyance relating to any Shuffler and DeckChecker Intellectual Property whichare not timely (but no later than 30 days from Seller’s receipt) executed bySeller.  Following the Closing, Sellerand Buyer agree to cooperate with each other and to provide each other with allinformation and documentation reasonably necessary to permit the preparationand filing of all federal, state, local and other Tax Returns with respect tothe Acquired Assets; provided that each Party shall reimburse the other Partyfor such other party’s reasonable out-of-pocket expenses in connectiontherewith.  Seller agrees that,subsequent to the Closing, it shall refer all customer inquiries with respectto the Acquired Assets to Buyer.  Sellerfurther agrees that if, after the Closing, Seller discovers any AdditionalBooks and Records (as defined below) or Additional Tools (as defined below)which Seller reasonably believed were not in existence as of the Closing andwhich were not previously transferred to Buyer (such items shall be referred toherein as “Discovered Items”), then (a) promptly following suchdiscovery, for no additional consideration, Seller shall transfer suchDiscovered Items to Buyer and (b) any 

 

 

Page 25

 

such Discovered Itemswhich are Additional Books and Records shall automatically and without furtheraction by either Party become Acquired Assets for purposes of thisAgreement.  For purposes hereof, (x) theterm “Additional Books and Records” shall mean any of the followingwhich is owned by and in the possession of Seller: bills of materials,engineering drawings, diagrams and specifications, circuit diagrams,schematics, mask works, parts lists, models, files, histories, reports,certifications, user manuals, service manuals, training manuals, salesliterature, technical bulletins, parts breakdowns, manufacturing workinstructions, quality control work inspection criteria, submission packages toregulators, validity studies, novelty studies, clearance studies, infringementstudies and any other documents or information necessary to manufacture theProducts, and (y) the term “Additional Tools” shall mean tooling,die castings, test fixtures and apparatuses, molds and equipment and relatedsoftware owned by Seller necessary to manufacture the Products or any parts forthe Products, other than commercial “off the shelf” equipment available onstandard terms.

 

7.6            Confidential Information.  The Non-Disclosure Agreement between Sellerand Buyer, dated December 17, 2008 (the “Non-Disclosure Agreement”),shall remain in full force and effect after any Closing of the Transaction,according to its terms; provided, however, that Buyer shall notbe restricted as to the use or disclosure of any information acquired by Buyerpursuant to: this Agreement; any Schedules; or the Acquired Assets.

 

7.7            Sales and Transfer Taxes.  Except as provided in Section 2.5(b)(iv),Seller, on the one hand, and Buyer, on the other hand, shall each pay fiftypercent (50%) of all sales, use, excise, value-added, goods and services,transfer, recording, documentary, registration, conveyance and similar Taxes(but not income Taxes) that may be imposed on the transfers of the Transaction(including any stamp, duty or other Tax chargeable in respect of any instrumenttransferring property and any recording fees or expenses payable in connectionwith the Transaction), together with any and all penalties, interest andadditions to Tax with respect thereto. Buyer and Seller shall cooperate in timely making all filings, returns,reports and forms as may be required to comply with the provisions ofapplicable law in connection with the payment of any such Taxes described inthe immediately preceding sentence. Buyer and Seller shall cooperate in providing each other withappropriate resale exemption certification and other similar Tax and feedocumentation.

 

7.8            [INTENTIONALLY OMITTED]

 

7.9            Covenant Not to Compete, Solicitor Hire.

 

### (a)      Seller hereby acknowledges and agrees:  that it is familiar with Seller’s Shufflerand DeckChecker Business (as defined below), its trade secrets and otherConfidential Information; that Buyer would be irreparably damaged if Seller,were to engage in the Shuffler and DeckChecker Business; and, in any suchevent, that any such competition by Seller would result in a significant lossof goodwill by Buyer in respect of the Acquired Assets being acquired by Buyer.  Seller hereby acknowledges and agrees thatthe covenants and agreements, and Seller’s, present and future adherencethereto, all as set forth in this Section 7.9 were, are, and continue tobe a material inducement to Buyer to enter into this Agreement and to performits obligations hereunder, and that Buyer would not obtain the benefit of thebargain set forth in this Agreement as specifically negotiated by the Partieshereto if Seller breached the provisions of this Section 7.9.  Therefore, subject to the provisions of Section 2.2(b),in further consideration of the Purchase Price, Seller hereby agrees that, (i) onthe Closing Date and continuing thereafter for a period of seven (7) years, Seller shall not,directly or indirectly, either for itself or through any other Person, engageor participate in the Shuffler and DeckChecker Business and/or any relateddesigning, licensing, leasing, developing, manufacturing, packaging, marketing,distributing or selling of the Products, anywhere in the world, and (ii) fromthe Closing Date and continuing thereafter, Seller shall not, directly orindirectly, either for itself or through any other Person, infringe, violate ormisappropriate any Intellectual Property of Buyer relating to any of Buyer’sshuffler or deck checker products, including, without limitation, the Shufflerand DeckChecker Intellectual Property (collectively, the “Non-CompeteObligations”) (it being understood and agreed that nothing herein willprevent Seller, or any Acquirer from engaging in slot machine 

###  

 

Page 26

###  

### sales, leases and licenses and themanufacture, marketing and/or sale of other table game products not related toshufflers or deck checkers, such as gaming chips).  For purposes of this Agreement, (i) theterm “participate” includes any direct or indirect interest in anyenterprise, whether as a stockholder, member, partner, joint venturer,franchisor, franchisee or otherwise (other than by ownership of less than tenpercent (10%) of the stock of a publicly held corporation) or rendering anydirect or indirect service or assistance to any Person, and (ii) “Shufflerand DeckChecker Business” means the manufacture, marketing and/or sale ofshuffler and/or deck checker products.   Seller agrees that the Non-Compete Obligations are reasonably designedto protect Buyer’s substantial investment and is reasonable with respect to itsduration, geographical area and scope. Notwithstanding anything to the contrary herein or in any RelatedAgreement, the Parties acknowledge and agree that the Non-Compete Obligationsshall survive any termination of this Agreement and any Related Agreement.

###  

### (b)    If, at the time of enforcement of any of the provisions of this Section 7.9,a court determines that the restrictions stated herein are unreasonable underthe circumstances then existing, then the parties hereto agree that the maximumperiod, scope or geographical area reasonable under the circumstances shall besubstituted for the stated period, scope or area.  The Parties further agree that such courtshall be allowed to revise the restrictions contained herein to cover themaximum period, scope or geographical area permitted by law.

###  

### (c)    If Seller (w) breaches; (x) threatens to commit abreach of; (y) challenges or contests, in any way, either directly orindirectly; or (z) assists any Person who is so challenging or contesting,any of the provisions of the Non-Compete Obligations, Buyer shall have thefollowing rights and remedies, each of which rights and remedies shall be independentof the others and severally enforceable, and each of which is in addition to,and not in lieu of, any other rights and remedies available to Buyer at law orin equity:

###  

#### (i)         the right and remedy to have the Non-Compete Obligationsspecifically enforced by any court of competent jurisdiction, it being agreedthat any breach or threatened breach of the Non-Compete Obligations would causeirreparable injury to Buyer and that money damages would not provide anadequate remedy to Buyer; and

####  

#### (ii)        the right and remedy to require Seller to account for and payover to Buyer any profits, monies, accruals, increments or other benefitsderived or received by Seller as the result of any transactions constituting abreach of the Non-Compete Obligations.

####  

### (d)    Nothing in this Agreement shall prevent or prohibit Buyerfrom:  (i) selling, leasing orlicensing products that have functionality that is similar to, identical to, oroverlap with functionality in any of the Excluded Assets; or (ii) selling,leasing, or licensing products which are the same as, substantially similar to,or compete with any Shuffler or DeckChecker Business.

###  

### (e)    Nothing contained in this Section 7.9 shall constitute orimply a license, at any time, to Seller, for any of the Shuffler and DeckCheckerIntellectual Property after Closing.

###  

7.10            [INTENTIONALLY OMITTED].

 

7.11            Regulatory.  Due to the highly regulated nature of Buyer’sand Seller’s business, prior to execution of this Agreement, each Party shallhave the right to perform such due diligence on the other as may be required byany gaming regulators in those jurisdictions where either Party possesses anylicenses, or such due diligence as either Party believes it is required toconduct.  Both prior to and on an onongoing basis, each Party shall fully and reasonably cooperate with the otherrelated to such due diligence. Notwithstanding any of the provisions contained in this Agreement to thecontrary, either Party shall have the right to immediately terminate anyongoing relationship (including without limitation this Agreement) with theother if such other Party takes any action or fails to take any action thatjeopardizes any of the other Party’s Gaming Permits, licenses or approvals, orin the event that such Party’s relationship with the other in any wayjeopardizes or puts at risk any of such Party’s Gaming Permits, licenses orapprovals, but any such termination shall not, in any way, alter, reduce, 

 

 

Page 27

 

modify or amend any of therights granted to either Party in this Agreement or in any Related Agreement,nor Buyer’s ownership of all right, title and interest in and to the AcquiredAssets after Closing.

 

7.12          Gaming Products Approval.  For any Gaming Product Approvals applicableto both an Acquired Asset and an Excluded Asset, Seller shall use commerciallyreasonable effort to transfer such Gaming Products Approval to the maximumextent possible, including by segregating or partially assigning such GamingProducts Approval to the extent allowable by the applicable gaming, certifyingagency, governmental, regulatory or labauthority.

 

 

**ARTICLEVIII**

# **MISCELLANEOUS**

#  

8.1            Amendment and Waiver.  This Agreement may be amended, and anyprovision of this Agreement may be waived; provided that:  (i) any such amendment or waiver shallbe binding upon Seller only if set forth in a writing executed by Seller andreferring specifically to the provision alleged to have been amended or waived;and (ii) any such amendment or waiver shall be binding upon Buyer only ifset forth in a writing executed by Buyer and referring specifically to theprovision alleged to have been amended or waived.  No course of dealing between or among theparties shall be deemed effective to modify, amend or discharge any part ofthis Agreement or any rights or obligations of any party under or by reason ofthis Agreement and a waiver of any provision by any party on one occasion shallnot be deemed to be a waiver of the same or any other breach on a futureoccasion.

 

8.2            Notices.  All notices, demands and other communicationsto be given or delivered under or by reason of the provisions of this Agreementshall be in writing and shall be deemed to have been given:  (i) when personally delivered, sent bytelecopy (with hard copy to follow) or sent by reputable overnight expresscourier (charges prepaid); or (ii) three days following mailing bycertified or registered mail, postage prepaid and return receiptrequested.  Unless a Party changes theaddress to which notice may be sent to such Party under this Section 8.2by delivering written notice of such change to the other Party in the mannerset forth above, all notices, demands and communications to Seller and Buyershall be deemed to have been given if delivered in the manner set forth aboveto the addresses indicated below:

 

**Noticesto Seller**:

ElixirGaming Technologies, Inc.

6650Via Austi Parkway, Suite 170, Las Vegas, Nevada 89119

TelecopyNo. (702) 617-4736

Attn:Walt Stowe

Email:waltstowe@elixirgaming.com

 

witha copy to:

(whichshall not constitute notice to Seller)

GreenbergTraurig, LLP

3161Michelson Drive

Suite 1000

Irvine,CA 92612

TelecopyNo. (949) 732-6501

Attn:Daniel K. Donahue

Email:donahued@gtlaw.com

 

 

Page 28

 

**Noticesto Buyer**:

ShuffleMaster, Inc.

1106Palms Airport Drive

LasVegas, NV  89119

TelecopyNo. (702) 270-5326

Attn:  Jerome R. Smith

Email:  jsmith@shufflemaster.com

 

witha copy to:

(whichshall not constitute notice to Buyer):

Paul,Hastings, Janofsky & Walker LLP

695Town Center Drive, Seventeenth Floor

CostaMesa, CA 92626

TelecopyNo. (714) 979-1921

Attn:  William J. Simpson

Email:  billsimpson@paulhastings.com

 

8.3            Assignment.  This Agreement and all of the provisionshereof shall be binding upon and inure to the benefit of the Parties hereto andtheir respective successors, acquirers, and permitted assigns; provided,however, Section 7.9 shall not be binding upon any successor to Seller ina merger, consolidation or sale of all or substantially all of Seller’s assetsunless the shareholders of Seller immediately prior to the consummation of suchtransaction hold, directly or indirectly, at least 50% of the voting shares ofsuch successor immediately following such transaction.  This Agreement and any of the rights,interests or obligations hereunder may be assigned or delegated by either Partyto another Person, but provided:  (i) suchPerson’s rights are subject to the non-assigning Party’s rights hereunder; and (ii) theassigning Party shall remain liable for its obligations under this Agreement.

 

8.4            Severability.  Whenever possible, each provision of thisAgreement shall be interpreted in such manner as to be effective and validunder applicable law, but if any provision of this Agreement or the applicationof any such provision to any Person or circumstance shall be held to beprohibited by or invalid, illegal or unenforceable under applicable law in anyrespect by a court of competent jurisdiction, such provision shall beineffective only to the extent of such prohibition or invalidity, illegality orunenforceability, without invalidating the remainder of such provision or theremaining provisions of this Agreement.

 

8.5            Interpretation.  The headings and captions used in thisAgreement and the table of contents to this Agreement are for referencepurposes only and shall not affect in any way the meaning or interpretation ofthis Agreement.  Any capitalized termsused in any Schedule or Exhibit attached hereto and not otherwise definedtherein shall have the meanings set forth in this Agreement.  Unless the context otherwise requires, theuse of the word “including” herein shall mean “including without limitation.”  The Parties hereto intend that eachrepresentation, warranty and covenant contained herein shall have independentsignificance.  If any Party has breachedany representation, warranty or covenant contained herein in any respect, thefact that there exists another representation, warranty or covenant relating tothe same subject matter (regardless of the relative levels of specificity)which such Party has not breached shall not detract from or mitigate the factthat such Party is in breach of the other representation, warranty orcovenant.  The fact that certain languagewas in draft of this Agreement but is not in the final version of thisAgreement shall not be given any interpretative meaning.

 

8.6            Entire Agreement.  This Agreement, the Related Agreements andthe Schedules and Exhibits hereto contain the entire agreement and understandingbetween the Parties hereto with respect to the subject matter hereof and,except as otherwise provided herein, supersede all prior agreements andunderstandings, whether written or oral, relating to such subject matter in anyway.  No Party has entered into thisAgreement based on or as a result of any promise, understanding, agreement,representation or warranty of the other Party, 

 

 

Page 29

 

unless any of same areexpressly stated, in writing, in this Agreement as an agreement, representationor warranty of said other Party.  Withoutlimiting the generality of the foregoing, no provision contained in any priordraft of this Agreement which is not expressly set forth herein shall bebinding upon or admissible as evidence of the intent of the Parties.

 

8.7            Counterparts.  This Agreement may be executed in one or morecounterparts (including by means of telecopied signature pages), all of whichshall be considered one and the same agreement, and shall become effective whenone or more such counterparts have been signed by each of the Parties anddelivered to the other Party.

 

8.8            Governing Law.  THE LAW OF THE STATE OF NEVADA SHALL GOVERNALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY, INTERPRETATION AND ENFORCEABILITYOF THIS AGREEMENT AND THE SCHEDULES ATTACHED HERETO, AND THE PERFORMANCE OF THEOBLIGATIONS IMPOSED BY THIS AGREEMENT, WITHOUT GIVING EFFECT TO ANY CHOICE OFLAW OR CONFLICT OF LAW RULES OR PROVISIONS (WHETHER OF THE STATE OF NEVADA ORANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANYJURISDICTION OTHER THAN THE STATE OF NEVADA. IT SHALL BE A MATERIAL BREACH OF THIS AGREEMENT IF EITHER SELLER ORBUYER CHALLENGES, OBJECTS TO, OR VIOLATES ANY PROVISION IN THIS SECTION 8.8.

 

8.9            No Strict Construction.  Notwithstanding the fact that this Agreementhas been drafted and prepared by one of the Parties, Buyer and Seller confirmthat each of it and its counsel have reviewed, negotiated and adopted thisAgreement as the joint agreement and understanding of the Parties, and thelanguage used in this Agreement shall be deemed to be the language chosen bythe Parties hereto to express their mutual intent, and no rule of strictconstruction shall be applied against any Person.

 

8.10          Injunctions, Specific Performance.  Each of the Parties acknowledges and agreesthat the other Party would be damaged irreparably in the event any of theprovisions of this Agreement are not performed in accordance with theirspecific terms or otherwise are breached. Accordingly, notwithstanding the provisions of Section 8.15 hereof,each of the Parties agrees that the other Party shall be entitled to aninjunction to prevent breaches of the provisions of this Agreement and toenforce specifically this Agreement and the terms and provisions hereof.  Such Party may, in addition to any otherremedy to which they may be entitled, at law or in equity, seek an injunctionor specific performance in an action instituted in any court in Clark County,Nevada; provided, however, if the Party sought to be enjoined isnot subject to personal jurisdiction in Clark County, Nevada, such action maybe instituted in any court of the United States or any state thereof havingjurisdiction over such Party and the matter (subject to the provisions setforth in Section 8.8).

 

8.11          No Third-Party Beneficiaries.  This Agreement is for the sole benefit of theParties hereto and their permitted assigns and nothing herein expressed orimplied shall give or be construed to give any Person, other than the Partieshereto and such permitted assigns, any legal or equitable rights hereunder.

 

8.12          No Relationship.  This Agreement does not constitute and shallnot be construed as constituting a partnership, joint venture or fiduciaryrelationship between Seller and Buyer. Neither Party shall have any right to obligate or bind the other Partyin any manner whatsoever, and nothing herein contained shall give or isintended to give any rights of any kind to any third Persons.

 

8.13          Bulk Transfer Laws.  Seller hereby agrees that it is responsiblefor compliance with any so-called bulk transfer laws of any jurisdiction inconnection with the sale of the Acquired Assets.

 

8.14          Schedules.  All Schedules attached hereto or referred toherein are hereby incorporated in and made a part of this Agreement as if setforth in full herein.  However, nothingin any Schedule shall be adequate to disclose an exception to a representationor warranty made in this Agreement unless such Schedule identifies the exceptionwith particularity and describes the relevant facts in reasonable detail.  Without limiting the 

 

 

Page 30

 

generality of theforegoing, the mere listing (or inclusion of a copy) of a document or other itemshall not be adequate to disclose an exception to a representation or warrantymade in this Agreement, unless the representation or warranty has to do withthe existence of the document or other item itself.  No exceptions to any representations or warrantiesdisclosed on one Schedule shall constitute an exception:  (i) to a representation or warrantyunless such representation or warranty calls for exceptions set forth on theSchedules; or (ii) to any other representations or warranties made in thisAgreement unless such exception is disclosed as provided herein on each suchother applicable Schedule.

 

8.15          Parties’ Submission to Jurisdiction.  Subject to the provisions ofSections 8.8 and 8.10 hereof, each of Seller and Buyer submit to theexclusive jurisdiction of binding arbitration under the American ArbitrationAssociation and the courts located in Clark County, Nevada, for any action orproceeding arising out of or relating to this Agreement and agrees that allclaims in respect of the action or proceeding shall be heard and determined,initially in such a binding arbitration proceeding, and, as required, with anyjudgment to be filed with and enforced by any appropriate court in ClarkCounty, Nevada, and in any other jurisdiction, as necessary.  Subject to the provisions of Section 8.10hereof and except for the purposes of enforcing an arbitration award, andunless a Nevada court determines that it does not have the power to enforcesuch an arbitration award, a Party shall not be entitled to bring any action orproceeding arising out of or relating to this Agreement in any otherforum.  Nothing in this Section 8.15,however, shall affect the right of any Party to serve legal process in anyother manner permitted by law or at equity. Each Party agrees that an award or judgment in any arbitration, actionor proceeding so brought shall be conclusive and may be enforced by suit on thejudgment or in any other manner provided by law or at equity.  The prevailing party in any such arbitration,action or proceeding shall be entitled to its reasonable attorneys’ fees, inaddition to any other remedies, at law or in equity.  It shall be a material breach of thisAgreement if either Seller or Buyer challenges, objects to or violates anyprovision of this Section 8.15. Further, and without limiting the generality of the foregoing, Selleragrees that Seller shall not challenge the validity or enforceability of any ofthe Shuffler and DeckChecker Intellectual Property in any action or proceedingarising out of or relating to this Agreement, including, without limitation,any such action or proceeding which seeks an injunction or specificperformance.

 

 

8.16          Circumvention.

 

Neither Party shall use,form or dissolve any affiliated entity or related body corporate which, in anymanner, directly or indirectly, circumvents, avoids or reduces the rights orobligations of a Party hereunder, or the intent of this Agreement, nor shalleither Party transfer or assign any assets or liabilities with the intent,purpose or effect of doing or causing any of same.

 

 

Page 31

 

IN WITNESS WHEREOF, theparties hereto have caused this Purchase Agreement to be duly executed as ofthe date and year first written above.

 

 

ELIXIR GAMING TECHNOLOGIES,INC.  (“Seller”)

 

 
| By             |   |   |
|----------------|--------|--------|
| Printed  Name: |   |   |
| Title:         |   |   |
|                |        |        |  |  |

 

 

SHUFFLE MASTER, INC.  (“Buyer”)

 

 
| By                                                 |   |   |
|----------------------------------------------------|--------|--------|
| Printed  Name: Jerome R. Smith                     |   |
| Title:  Executive Vice President, General Counsel, |
| and  Corporate Secretary                           |   |
|                                                    |        |        |  |