Document:

Exhibit 10.49

 

MACHINES OPERATION AND
PARTICIPATION AGREEMENT

 

This AGREEMENT is entered into on            December   2008 and executed by and between:

 

ELIXIR GAMING TECHNOLOGIES (HONG
KONG) LIMITED, a
company incorporated in Hong Kong, with correspondence address at Units 2B &
3A, 29/F., The Centrium, 60 Wyndham Street, Central, Hong Kong (“ELIXIR”);

 

-
and -

 

ELIXIR
GAMING TECHNOLOGIES,
INC., a company incorporated in Nevada, with
registered office at 6650 Via Austi Parkway, Suite 170, Las Vegas, Nevada,
89119, United States of America (the “Guarantor”);

 

-
and -

 

NAGAWORLD LIMITED, a company incorporated in Hong Kong, with
correspondence address at Nagaworld, Hun Sen garden, Phnom Penh Cambodia (the “VENUE OWNER”).

 

W
I T N E S S E T H

 

WHEREAS :

 

(A)      ELIXIR is a provider of gaming technology, products and related
services;

 

(B)       the VENUE OWNER is the holder of the valid gaming license granted by
the applicable governmental authorities for operating gaming business at
NagaWorld in Cambodia, a hotel casino complex owned by the VENUE OWNER (“NagaWorld”); and

 

(C)       ELIXIR is desirous of operating and management of the Machines (as defined
below) within the Prescribed Gaming Hall (as defined below) and the VENUE OWNER
agrees to grant the permission to ELIXIR to operate and manage the Machines
within the Prescribed Gaming Hall upon the terms and conditions as set forth in this Agreement below.

 

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(D)      The Guarantor is the holding
company of ELIXIR and whose shares are listed and traded on the American Stock
Exchange. In consideration of the
VENUE OWNER agreeing to enter into this Agreement, the Guarantor agrees to guarantee to the VENUE OWNER the
performance by ELIXIR of its obligations under this Agreement.

 

NOW, THEREFORE, the parties agree as follows:

 

1.             AGREEMENT AND UNDERTAKINGS

 

1.1           The VENUE OWNER hereby agrees to grant the permission to ELIXIR and ELIXIR agrees to accept such permission to manage and operate certain electronic gaming machines (  the
initial  number of such machines to be rolled
out and the machines-mix thereof shall be determined by the Machines Operation
Committee (as defined in Clause 1.8 below))
(collectively the “Machines”) to
be provided by ELIXIR hereunder  at a
prescribed gaming hall within NagaWorld, the location and identification of
such prescribed gaming hall is set out in Schedule A (the
“Prescribed Gaming Hall”).  For the avoidance of doubt, the permission to
manage and operate the Machines shall be restricted to the Prescribed Gaming
Hall only and ELIXIR shall have no right to manage and/or operate any Machines
or any other machines or gaming devices in other part of NagaWorld and/or any other
premises owned by the VENUE OWNER.

 

1.2           Subject to the terms hereof (and in particular Clauses 2
and 3  below), it is ELIXIR’s obligations
under the Agreement, at its costs (unless otherwise specified in this
Agreement) to:

 

a.        provide the Machines and the related equipment and systems for use of
the Machines, including (i) bill validators; (ii) slot management
system (whether as a stand alone unit or centrally located); (iii) slot
machine bases; (iv) chairs and (v) such other tools, equipment, spare parts
or such other device or parts as may be reasonably required for the operation
of the Machines to the VENUE
OWNER and install the same (subject to the simultaneous performance of the
obligations by the VENUE OWNER under Clause 1.3(a) below)
at the Prescribed Gaming Hall as soon as reasonably practicable after the date
of this Agreement but in any case shall not be later than 30 days after the
date of determination by the Machines Operation Committee on the initial
roll-out number of the Machines and the machines-mix. Notwithstanding the
foregoing, the parties 

 

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agree
to use their best endeavour to procure the Prescribed Gaming Hall to be opened
for operation on or before 30 January 2009;

 

b.        provide all necessary technical personnel of ELIXIR to handle all
technical and maintenance issues that arise in connection with the Machines and
the related systems and equipment supplied by ELIXIR at the Prescribed Gaming
Hall;

 

c.        operate the Machines in the Prescribed Gaming Hall in accordance with the terms of
this Agreement;

 

d.        comply with all applicable laws that related to its business operation
and the operation of the Machines
at the Prescribed Gaming Hall; and

 

e.        perform and comply with such other
obligations/ undertakings on the part of ELIXIR as expressly set out in this Agreement.

 

1.3           Subject to the terms hereof, it is the VENUE OWNER’s obligations under
this Agreement, at its own costs (unless
otherwise specified in this Agreement) to:

 

a.     provide (i) UPS; (ii) Genset; and (iii) CCTV
surveillance systems and all necessary electrical, cabling and other
connections, fittings and facilities which are reasonably required for the
proper installation and operation of the Machines and the related equipment and systems supplied by ELIXIR at the
Prescribed Gaming Hall;

 

b.     without prejudice to the generality of foregoing provision, provide the
reasonably necessary facilities for the proper installation and operation of
the Machines and the related equipment and systems
supplied or to be supplied by ELIXIR including but not limited to
air-conditioning and stable power supply voltage;

 

c.     carry out the gaming and wagering business and activities, (including
the Machines in the Prescribed Gaming Hall)  in NagaWorld in accordance with agreements
already signed with the relevant government authorities and the terms of this
Agreement;

 

d.     comply with all applicable laws that related to its business operation
and the operation of the gaming business at NagaWorld 

 

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and the operation of the
Machines at the Prescribed Gaming Hall; and

 

e.     perform and comply with such other
obligations/ undertakings on the part of the VENUE OWNER as expressly set out
in this Agreement.

 

1.4       Upon request by the Floor Staffs (as defined in Clause 1.6 below) of managerial grade:

 

(a)   the VENUE OWNER shall provide, within the Prescribed Gaming Hall, food
and beverage to the players and patrons of the Machines at the rate to be charged by Nagaworld according to Schedule B to this Agreement or such other rate as may be determined
by the Machines Operation Committee;

 

(b)   the VENUE OWNER shall provide, within NagaWorld, food and beverage,
night club facilities services, karaoke, spa, hotel room, transportation
and other hotel facilities services to the high roller or VIP players and
patrons of the Machines at the rate to be charged by Nagaworld according to Schedule B to
this Agreement or such other rate as may be determined by the Machines
Operation Committee,

 

provided that the cost payable to the VENUE OWNER (at
the relevant rate set out in Schedule B or,
as the case may be, in accordance with the determination by the Machines
Operation Committee) for provision of the aforesaid items or services shall be reimbursed from the Marketing
Fund (as defined in Clause 1.5  below).

 

1.5           ELIXIR and the VENUE OWNER shall set up a fund designated as budgeted
marketing expenditure (“Marketing Fund”).
Any contribution by ELIXIR and the VENUE OWNER to the Marketing Fund shall be
in the proportion of 25% by ELIXIR and 75% by the VENUE OWNER. The annual
budget for the Marketing Fund for the first 12 months from the Commercial
Commencement Date (as defined in Clause 14 below),
the
annual budget for the Marketing Fund for the remaining term of this Agreement and the amount and the timing of the
contributions to be made to the Marketing Fund by the parties thereto shall be determined by the Machines Operation
Committee (as defined in Clause 1.8 below) from time to time. In connection with the
Marketing Fund, it is agreed that :

 

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(a)       ELIXIR hereby irrevocably authorizes the VENUE OWNER to have control
over the keeping of the Marketing Fund provided that (i) the Marketing
Fund shall only be applied and used in
accordance with such Marketing Plan (as defined in sub-clause (b) below)
as approved by the Machines Operation Committee (as defined in Clause 1.8
below) and/or for the
purpose of funding the costs of providing the food and beverages and other
amenities to the players or patrons of the Machines at the Prescribed Gaming
Hall in accordance with Clauses  1.4(a) and (b) above;  (ii) the
VENUE OWNER shall keep proper books and records concerning the accumulation and
any usage of the Marketing Fund; and (iii) ELIXIR shall have full audit
rights (at that its sole costs) regarding the Marketing Fund and the VENUE
OWNER shall provide all necessary information that relates to application of
the Marketing Fund upon reasonable request by ELIXIR;

 

(b)       at such time as ELIXIR and VENUE OWNER deem appropriate, either the
parties together or ELIXIR alone shall formulate such marketing and promotion
plan and the related budget for the Machines at the Prescribed Gaming Hall (“Marketing Plan”) and put forward the same to the Machines
Operation Committee for its approval;

 

(c)       subject to the approval by the Machines Operation Committee, the VENUE
OWNER and ELIXIR shall implement the Marketing Plan in accordance with the
approved budget within a reasonable timeframe;

 

(d)       nothing contained in this Clause 1.5 shall preclude either (i) the VENUE OWNER
(at its sole discretion and which is not obliged to) to carry out, at its own
costs, any additional marketing and promotion plans for NagaWorld or any part
thereof (regardless of whether or not such additional marketing and promotion
events will also benefit or cover the Prescribed Gaming Hall) or (ii) ELIXIR
(at its sole discretion and which is not obliged to) to carry out, at its
costs, any additional marketing and promotion plans for the Prescribed Gaming
Hall
provided that such additional marketing and promotion plans or events
formulated or carried out by ELIXIR shall be subject to the prior written
approval of the VENUE OWNER (such approval not to be unreasonably withheld or
delayed). The parties agree that
all these additional marketing and promotion events initiated by the respective
parties shall not be funded by
the Marketing Fund and shall not be subject
to approval by the Machines Operation Committee; and

 

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(e)       all records, papers, documents, materials or works (and all the
Intellectual Property Rights embedded therein) made or prepared by the
respective parties in relation to :

 

(i)    the marketing efforts as set out in Clause 1.5(d) above shall belong to and remain the
exclusive property of the relevant making or preparing party; and

 

(ii)   the Marketing Plan (as defined in Clause 1.5(b) above)
shall belong to the VENUE OWNER and ELIXIR jointly provided that nothing contained herein shall prevent
either party at any time from using for any purpose it thinks fit any know-how
or experience gained or arising from the preparation or implementation of such
Marketing Plan, subject always to complying with the obligations in Clause 20 in respect of the Confidential Information.

 

For
the purpose of this Agreement, “Intellectual
Property Rights”
means patents, trade marks, service marks, design rights (whether registrable
or otherwise), applications for any of the foregoing, copyright, know-how,
trade or business names and other similar rights or obligations whether
registrable or not in any part of the world.

 

1.6     In addition to the respective obligations of the parties set out above
and in the best interest of the operation of the Machines in the Prescribed
Gaming Hall, it is agreed that the business in the Prescribed Gaming Hall may require such number of staff as may
be approved by the Machines Operation Committee from time to time to provide
the relevant services to the players and customers of the Machines at the
Prescribed Gaming Hall (collectively “Floor Staffs”)
provided that :

 

(a)   ELIXIR shall either by itself or procure its
affiliated company, namely Elixir Gaming Technologies (Cambodia) Limited, to be
responsible for employing the Floor Staffs. All the salaries, wages and related
expenses (the amount of which shall be subject to the approval of the Machines
Operation Committee) of the Floor Staffs shall be paid by ELIXIR and shall
subsequently be shared by ELIXIR
and the VENUE OWNER in the proportion of 25% by ELIXIR and 75% by the VENUE
OWNER;

 

(b)   all the costs for preparing uniforms for the Floor Staffs (the amount of which shall be subject to the approval
of the Machines Operation 

 

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Committee)
shall be paid by ELIXIR and shall subsequently be borne as to 25% by ELIXIR and 75% by the
VENUE OWNER;

 

(c)   the VENUE OWNER shall provide daily meals to the Floor Staffs at the
staff canteen located within NagaWorld. 
All reasonable expenses for providing such meals to the Floor Staffs (“Meal Expenses”)
during the term of this Agreement shall
be shared by the parties in the proportion of 25% by ELIXIR and 75% by the
VENUE OWNER;

 

(d)   the parties agree that (i) the VENUE OWNER shall inform ELIXIR in
writing of the amount its share of
the Meal Expenses for the immediate previous month on monthly basis. ELIXIR shall then separately bill the VENUE
OWNER for its portion of the salaries and wages as set out in Clause 1.6(a) above together with other related
expenses incurred in respect of the Floor Staffs as set out in Clause 1.6(b) above LESS ELIXIR’s portion of the
Meal Expenses (“Net Floor Staffs Costs”) monthly
in each calendar month and the VENUE OWNER shall pay its portion of the Net
Floor Staffs Costs on or before the fifteenth (15th) day
of the following calendar month. Any overdue payment shall bear interest at the
rate set out in Clause 3.4 below; and

 

(e)   ELIXIR shall reserve rights to lay-off any particular Floor Staff and
to recruit any replacement thereof provided that the total number of Floor
Staffs employed at any given time during the term of this Agreement shall not
be materially lower than the number as determined by the Machines Operation
Committee from time to time.

 

1.7           During the term of this Agreement, the VENUE
OWNER agrees and undertakes that it will always maintain the
floor area of the Prescribed
Gaming Hall with the Machines
pursuant to the terms hereof on an exclusive basis provided that the Machines
supplied must be approved by the Machines Operation Committee. For the
avoidance of doubt, nothing
in this Clause 1.7 shall preclude or prohibit the VENUE OWNER from, at its own costs,
leasing, purchasing or acquiring any electronic gaming machine from any third
party for operations at any other areas of NagaWorld save and except for the
Prescribed Gaming Hall. In the event that the VENUE OWNER has breached this
provision, ELIXIR may issue a written notice demanding the VENUE OWNER to
rectify the breach by removing all gaming machines not provided by ELIXIR from
the Prescribed Gaming Hall in accordance with Clause 9.1(a) below.

 

1.8           During
the term of this Agreement, each of the VENUE OWNER and
ELIXIR shall appoint two of its senior personnel as representatives to form a machine operation committee for
the purpose of operating and management of the Machines at the Prescribed
Gaming Hall and those 

 

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related
matters to be managed by this committee as set out in this Agreement (“Machines
Operation Committee”) and unless agreed in writing by the VENUE OWNER
and ELIXIR, the Machine Operation Committee shall always comprise four members. The members of the Machines Operation Committee shall meet (whether by
physical meeting or telephone conference) on at least a monthly basis (with the
first meeting to be held within one month from the date of this Agreement at which certain matters
relating to the Machines and the carrying on the electronic gaming machine
business at the Prescribed Gaming Hall, including, inter alia, the initial
number of the Machines to be rolled out and the machines-mix thereof as set out
in Clause 1.1 above shall be determined)
during the term of this Agreement to jointly approve and monitor the Marketing
Fund and to review performance results of the Machines and if necessary, to consider
the necessary improvement measures. The quorum for all meetings of the Machines
Operation Committee shall be at least two, one representative from the VENUE
OWNER and one representative from ELIXIR. All decisions of the Machines
Operation Committee shall be made by way of unanimous consent of the members
present at the relevant meeting.

 

Without prejudice to the
generality of the foregoing, the Machines Operation Committee shall be in charge of the
following functions and/or decisions making :

 

(a)     the determination of annual budget for the Marketing Fund for the first
12 months from the Commercial Commencement Date (as defined in Clause 14 below), the annual budget for the Marketing Fund for
the remaining term of this Agreement
and the amount of the Marketing Fund which may be reasonably incurred and the
timing of contributions thereto by the parties; the consideration, and if
applicable, approval of any proposed Marketing Plan (as defined in Clause 1.5
above); if deemed necessary by the Machines Operation Committee, the
determination of other rates of cost of providing those items or services by
the VENUE OWNER as mentioned in Clauses 1.4 (a) and (b) above or the
rate of costs of providing any item or service not mentioned in Schedule B; and
the determination of such other number of Floor Staffs as may be reasonably
required for operation of the electronic gaming machine business at the Prescribed Gaming Hall as mentioned in Clause 1.6
above;

 

(b)     the determination of any
reasonably necessary alteration, amendment, modification or addition to the
Machines; and the 

 

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determination of the
pay-out percentage and/or gaming client winning of any particular Machine (and
any subsequent change thereof), provided that the consent of any member of the
Machines Operation Committee shall not be unreasonably withheld if the proposed
relevant pay-out percentage and/or gaming client winning is set in accordance
with the then prevailing pay-out policy of the VENUE OWNER for NagaWorld and
not outside the range of 85% to 98% (inclusive of jackpot but exclusive of
loyalty reinvestment);

 

(c)     the determination of the lay-out plan of the Prescribed Gaming Hall and
the location for the Machines to
be placed (and any subsequent change thereof). Once the Machines have been
installed according to the approved lay-out plan and location, no Machine shall be moved by either the VENUE
OWNER or ELIXIR (or any of their
respective employees or agents) away from the relevant designated location unless consents
from both the VENUE OWNER and ELIXIR are obtained and if the proposed removal
of the Machines is due to the fact that the location of any of the Machines affects
the business of Prescribed Gaming Hall and under such circumstance, the consent
should not be unreasonably withheld by both parties;

 

(d)     the determination of the
initial roll-out number of the Machines and the machines-mix thereof; and any
subsequent increase or decrease in the number of Machines at the Prescribed
Gaming Hall (provided that any additional electronic gaming machines so added
to the Prescribed Gaming Hall pursuant to the decision of the Machines
Operation Committee shall form part of the Machines and be governed by this
Agreement); any change in gaming machines-mix at the Prescribed Gaming Hall
and/or any necessary change of games of the Machines provided that when considering whether or not the necessary
change of games is required, the following factors shall be taken into account
by the Machines Operation Committee :

 

(i) a change of game
may only be required if the Monthly Gross Win (as defined in Clause 3.1 below) of a particular Machine for a period of
three consecutive months falls below 30% of the total floor average gross win
of Machines at the Prescribed Gaming Hall for that period; and

 

(ii) notwithstanding
the circumstance mentioned in sub-clause (i) above, there shall not be any
change of game for the relevant 

 

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Machine in issue if the
Monthly Gross Win generated by that particular Machine has attained a
satisfactory performance level as determined by the Machines Operation
Committee.

 

ELIXIR shall perform the
relevant game change within 45 days from the date of relevant determination by
the Machines Operation Committee.

 

1.9                   Notwithstanding
anything to the contrary contained herein, for the avoidance of doubt, all the
cage control and financial management functions in relation to the Machines at
the Prescribed Gaming Hall shall be responsible by the VENUE OWNER at its sole
costs.

 

2.             DELIVERY,
TAXES AND ACCEPTANCE

 

2.1           ELIXIR shall be responsible for arranging for
the transportation (including but not
limited to the selection of the common carrier) of the Machines, the related
equipment and systems and/or spare parts and/or devices, and insurance during transit, from their
relevant places of origin/ manufacturing bases to the Prescribed Gaming
Hall.  All costs and expenses incurred in
relation to such transportation and insurance shall solely be borne by ELIXIR.

 

2.2           It is agreed by the parties that :

 

(a)   ELIXIR will bear all taxes and duties under the applicable
jurisdictions of the relevant places of origin/ manufacturing bases for the
export of the Machines, the related equipment and systems and/or spare parts
that supplied by it hereunder and ELIXR will bear all taxes and duties that
relate to the import (into Cambodia) of the Machines, the related equipment and
systems and/or spare parts.

 

(b)   the VENUE OWNER will bear the monthly gaming taxes in connection with
all the gaming operations at NagaWorld (which cover the electronic gaming
machine business operation at
the Prescribed Gaming Hall); and

 

(c)   each party hereto shall bear its own profit or corporate income tax
and/or (if applicable) any value added tax and/or any withholding tax on wages,
interest and dividends payable by that party.

 

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2.3           Since ELIXIR owns the
legal title to the Machines and,  the
installation of the Machines and the related equipment and systems at the
Prescribed Gaming Hall is the sole responsibility of ELIXIR. ELIXIR shall be
responsible for any defects and subsequent repair of the Machines, the relevant
related equipment and systems or any part or devices thereof supplied by it, the VENUE OWNER shall duly
accept the Machines and the related equipment and systems in good faith.

 

3.             CONSIDERATION

 

3.1           In consideration of this Agreement and the respective undertakings and
obligations of each party hereto, each
party shall be entitled to share the Monthly
Gross Win (as defined below) generated by all Machines in the
Prescribed Gaming Hall according to the following ratio:

 

(i)            ELIXIR shall be entitled to Twenty five  percent (25%)of the
Monthly Gross Win;
and

 

(ii)           the VENUE OWNER shall be entitled to Seventy five
percent (75%) of the Monthly Gross Win.

 

For the purpose of this Agreement,

 

“Monthly Gross Win” of the Machines at the Prescribed Gaming
Hall represents all amounts played in/ wagered on all the Machines at the
Prescribed Gaming Hall during a calendar month reduced by both (i) the winnings (including but not limited
to jackpot, if applicable) paid out and (ii) if applicable, all amounts
deposited into the Machines at the Prescribed Gaming Hall to ensure there are a
sufficient number of coins to pay out the winnings, during the same month.

 

3.2           The VENUE OWNER and ELIXIR agree that all collections and counting of
monies from the drops of the Machines shall be performed in the presence of
ELIXIR’s personnel and ELIXIR’s personnel shall present to the Prescribed
Gaming Hall to attend to the collection and counting of monies. The relevant
portion of the Monthly Gross Win payable to ELIXIR shall be computed by the VENUE OWNER at the end of every
calendar month, and distribution of which shall be made on or before the fifteenth (15th) day of the following calendar month. Save
in case of manifest error and subject to Clause 3.3 below,
the win/loss report prepared by the VENUE OWNER shall be the sole 

 

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basis of computing the Monthly Gross Win
and the amounts payable to ELIXIR.

 

3.3           ELIXIR shall have full audit rights (at its sole costs) regarding the
performance of the Machines for the purpose of verifying the amount for
distribution in the Monthly Gross Win and the VENUE OWNER shall provide all reasonably necessary information that relates to the
performance of the Machines (including but not limited to the relevant books
and records) upon reasonable request by ELIXIR for performing such audit. The VENUE
OWNER also agrees that it will provide all reasonable assistance, information
and access thereto (including but not limited to allowing ELIXIR and any
persons nominated by ELIXIR to enter into the Prescribed Gaming Hall at any reasonable time with prior
appointment) to ELIXIR for its performance of such audit.

 

3.4           All overdue payment from either party under this Agreement shall bear
interest at an annual rate of 18% per annum
from the date when such payment become due up to the actual date of payment.

 

3.5           The VENUE OWNER agrees that all distributions of Monthly Gross Win to
ELIXIR will be made in the currency collected from the Machines at the
Prescribed Gaming Hall.

 

4.             OWNERSHIP AND TITLE

 

4.1           The Machines and all
related equipment and systems, spare parts, components used therein or thereof
supplied by ELIXIR hereunder are and shall remain personal property of ELIXIR
notwithstanding that the Machines and all related equipment and systems, spare
parts, components used therein or thereof or any part of it may now or
hereafter be affixed to NagaWorld and/or the Prescribed Gaming Hall during the term of this Agreement.

 

4.2           Ownership and title
to each item of the Machines and all related equipment and systems, spare
parts, components used therein or thereof supplied by ELIXIR hereunder shall
remain with ELIXIR at all times and the VENUE OWNER shall have no right, title
or interest therein except as expressly set forth in this Agreement.

 

4.3           During the term of
this Agreement and thereafter until ELIXIR has repossessed the Machines, ELIXIR shall procure each piece of the Machines to bear identification showing its inventory and/or serial 

 

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number, and the fact of ELIXIR’s
ownership, which identification shall not be altered, defaced, covered or
removed by the VENUE OWNER.

 

4.4           The
VENUE OWNER acknowledges
and agrees that any and all of the Intellectual Property Rights
(as defined in Clause 1.5 above) used or embodied in or in connection with and all
text, audio, video, still images, data (including but not limited to the
patrons/players data base) and information collected by or stored in the
Machines, and/or the related equipment and
systems supplied by ELIXIR hereunder shall at all times remain the property of ELIXIR
or, as the case may be, the relevant manufacturers and/or developers of the
Machines and/or the related equipment and systems.

 

5.             REPRESENTATIONS, WARRANTIES AND
UNDERTAKINGS

 

5.1           Each party hereby represents and warrants to the other party that:

 

(a)           It has the corporate and legal power or
authority to enter into this Agreement and to deliver and perform its obligations
hereunder according to the terms of this Agreement, and that it has taken all
necessary corporate and legal or other actions to authorize its entry into and
performance of this Agreement;

 

(b)           This Agreement constitutes legal, valid and
binding obligation, enforceable in accordance with its terms and conditions;

 

(c)           The execution and/or performance of this
Agreement does not and will not contravene any provision of its Articles of Association and Bye-Laws or any other equivalent constitutional documents, does not and will not violate any applicable laws or
regulations of the jurisdiction of its incorporation or organization, and does
not and will not conflict with or result in a breach of any contract, agreement
or other obligation to which it may be bound; and

 

(d)           All consents, approvals, licenses, permits,
authorizations, declarations, filings and registrations necessary for the due
execution, delivery, and performance of this Agreement have been obtained or
effected, and all such consents, approvals, licenses, permits, authorizations,
declarations, filings and registrations remain in full force and effect during
the term of this Agreement.

 

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5.2           Without prejudice to
the generality of foregoing provisions in Clause
4 above, during the term of this Agreement and thereafter until
ELIXIR has repossessed the Machines :

 

(a)   the VENUE OWNER undertakes
that it will take all reasonable care and security control of the Prescribed Gaming Hall and ELIXIR undertakes that the Machines
shall be kept in good and serviceable condition (reasonable fair wear and tear
and deficiency, defect or break down arising from normal usage excepted) and
since ELIXIR has the legal title to the Machines, ELIXIR shall insure the Machines against loss of or damage to
the Machines howsoever caused (including those loss or damage caused by the
negligence of ELIXIR’s staff or agent);

 

(b)   the VENUE OWNER represents that the business in the Prescribed Gaming
Hall has obtained all necessary governmental or third party’s permissions, licences (including but not limited to relevant gaming license),
permits, approvals and consents and undertakes to use its best endeavours to
keep such permission, licences, permits, approvals and consents effective
throughout the term of this Agreement and each party undertakes to the other
that it will comply with all applicable laws in relation to the operation of
the Machines at the Prescribed Gaming Hall;

 

(c)   each of the VENUE OWNER and ELIXIR undertakes to each other that it will
not and will procure their respective employees or agents not to, make or
cause or permit to be made any alteration, amendment, modification or
addition to the Machines, or any part or component (except maintaining and/or repairing of the Machines as set out in
sub-clause (d) of this Clause 5.2) thereof
without the approval of the Machines Operation Committee and that any such
alteration or modification, if approved by the
Machines Operation Committee, of whatsoever kind shall belong to and become
the property of ELIXIR and form part of the Machines;

 

(d)   the VENUE OWNER
undertakes that it will not and will procure its employees or agents not to, carry out any repair and/or maintenance
works to the Machines by itself unless such repair and/or maintenance works are
performed by ELIXIR’s technician; or (ii) with the presence of/ under the
instructions of ELIXIR’s technician;

 

(e)   the VENUE OWNER undertakes that it will permit ELIXIR and
any technical persons nominated by ELIXIR to enter into the Prescribed Gaming
Hall at any time so as to inspect and/or repair the Machines, if necessary and
to enable ELIXIR and its authorised personnel to perform its obligations or
exercise its rights hereunder (including but not limited to the carrying out of
the relevant audit pursuant to Clause 1.5(a)(iii) and/or Clause 3.3 and the
overseeing of the collections
and 

 

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counting
of monies from the drops of the Machines pursuant to Clause 3.2 );

 

(f)    each of the VENUE OWNER and ELIXIR undertakes to the other that it will
not use or permit the Machines to be used in contravention of any statutory
provision or regulation or in any way contrary to law or for any purpose for
which the Machines are not designed or reasonably suitable;

 

(g)   ELIXIR undertakes that, unless with the prior approval of the VENUE
OWNER it will not sell or offer for sale, assign, mortgage, pledge, create any charge, lien
or encumbrances,  sub-let or lend out
the Machines or in any way part with the Machines or any interest therein;

 

(h)   the VENUE OWNER and ELIXIR
undertakes to each other that it will punctually pay, if applicable, their
respective own license fees, service charges, taxes, levies and other outgoings
or payments for the carrying on the gaming machine business in the Prescribed
Gaming Hall . For the avoidance of doubt, the VENUE OWNER shall be solely
responsible for paying (if applicable) electricity, gas, water and other
utilities charges, property tax and related duties in respect of NagaWorld and
more particularly, the Prescribed Gaming Hall;

 

(i)    the VENUE OWNER
undertakes that it will not and will procure its employees or agents not to,
move the Machines or any part thereof from the Prescribed Gaming Hall to other
location without ELIXIR’s prior consent in writing; and

 

(j)    ELIXIR warrants that
all the Machines used for the operation in the Prescribed Gaming Hall have been
fully paid for and the Machines are not subject to any charge, lien or
encumbrances, foreclosure or any court proceedings, any litigation or claims by
any third party.

 

5.3       Each of the VENUE OWNER and ELIXIR
hereby warrants that it shall indemnify, defend and save harmless from the other, from
and against all claims, lawsuits, losses, damages and expenses arising out of
or resulting from any breach or inaccuracy of its relevant
representations, warranties or undertakings set out in this Agreement.

 

6.             GUARANTEE

 

6.1           In consideration of the VENUE OWNER agreeing to enter into this Agreement,
the Guarantor hereby guarantees to the VENUE OWNER and its permitted
successors, transferees and assigns the due and punctual performance and
observance by ELIXIR of all its obligations under this Agreement or arising
from any termination of this Agreement and if the ELIXIR defaults in payment of
any sum when 

 

15

 

due or any amount payable to the VENUE OWNER under
this Agreement or arising from its termination, the Guarantor shall immediately
on demand by the VENUE OWNER, unconditionally pay that amount to the VENUE
OWNER as if it was ELIXIR and, without prejudice to the foregoing, as an
independent and primary obligation of the Guarantor. The Guarantor
unconditionally and irrevocably agrees to indemnify and keep indemnified the VENUE
OWNER from and against all losses, damages, costs, claims, liabilities, demands
and expenses of whatsoever nature which it may suffer or incur arising from the
failure of ELIXIR to comply with any of its obligations, or discharge any of
its liabilities under this Agreement or through any of the guaranteed obligations becoming
unenforceable, invalid, or illegal (on any grounds whether known to them or to ELIXIR
or not).

 

6.2           If any of the
obligations of ELIXIR that are the subject of the guarantee contained in this Clause 6
(such guarantee being hereinafter referred to as “the Guarantee”) cease to be
valid or enforceable (in whole or in part) on any ground whatsoever (including,
but not limited to, any defect in or want of powers of the relevant party or
irregular exercise thereof or any lack of authority on the part of any person
purporting to act on behalf of the relevant party or any legal or other
limitation, disability or incapacity, or any change in the constitution of, or
any amalgamation or reconstruction of, or the liquidation receivership or
insolvency of the relevant party), the Guarantor shall nevertheless be liable
to the VENUE OWNER in respect
of the purported obligation or liability as if the same were fully valid and
enforceable and the Guarantor was the principal obligors in respect thereof.

 

6.3           The liabilities of the
Guarantor under the Guarantee shall not be discharged or affected in any way
by:-

 

(a)           the VENUE OWNER compounding or entering into any compromise,
settlement or arrangement with ELIXIR or any other person; or

 

(b)           any variation, extension, increase, renewal, determination, release
or replacement of this Agreement whether or not made with the consent or
knowledge of the Guarantor; or

 

(c)           the VENUE OWNER granting any time, indulgence, concession, relief,
discharge or release to ELIXIR or any other person realising, giving up,
agreeing to any variation, renewal or replacement of, releasing, abstaining
from or delaying to taking advantage of or otherwise dealing with any securities
from or 

 

16

 

other rights or
remedies which it may have against ELIXIR or any other person; or

 

(d)           any other matter or thing which, but for this provision, might
exonerate or affect the liabilities of the Guarantor.

 

6.4           The VENUE OWNER shall
not be obliged to take any steps to enforce any rights or remedy against ELIXIR
before enforcing the Guarantor.  The
Guarantee is in addition to any other security or right now or hereafter
available to ELIXIR.

 

7.             INSURANCE

 

7.1       The VENUE OWNER shall, at
its own expenses, insure the property (other than the Machines and the related
equipment and systems supplied by ELIXIR) and the premises within the
Prescribed Gaming Hall with any insurance companies as it deems proper against
all loss or damage to them that may be occurred.

 

7.2       ELIXIR shall, at its own
expense, insure the Machines and the related equipment and systems supplied by ELIXIR (including
insurance for those loss or damage caused by the negligence of ELIXIR’s staff
or agent) with any insurance companies as it deems proper against
all loss or damage to them that may be occurred after the same being delivered
onto the Prescribed Gaming Hall.

 

7.3       When ELIXIR takes out such
insurance policy as mentioned in Clause 7.2 above, the VENUE OWNER
shall upon written request by ELIXIR at
any time to allow the personnel(s) of such insurance company to enter into
the Prescribed Gaming Hall at reasonable time
with prior appointment to inspect, examine and take stock of the relevant
Machines and the related equipment and systems
supplied by and belongs to ELIXIR.

 

7.4           When ELIXIR takes out such
insurance policy as mentioned in Clause 7.2 above, ELIXIR shall
provide a copy of the terms and conditions of the relevant insurance policy to
the VENUE OWNER. Subject to the provision of copy of such terms and conditions
(or a summary thereof), the VENUE OWNER and ELIXIR undertakes and agrees to the other that it will not use or allow
the Machines and the related equipment and systems provided by ELIXIR to be
used for any purpose not permitted by the terms and conditions of any policy of
insurance for the time being relating to the Machines and such related equipment
and systems and 

 

17

 

the VENUE OWNER and ELIXIR shall not do or allow to be done any act or
thing whereby such insurance may be invalidated.

 

7.5           In the
event of any loss of or damage to all or any part of the Machines and the
related equipment and systems and ELIXIR initiates
claims against any insurance company, the technical personnel of ELIXIR shall give
immediate notice to VENUE OWNER and upon reasonable request by ELIXIR, the
VENUE OWNER shall provide such reasonable assistance to ELIXIR in relation to
the making of any appropriate claim or claims under the said insurance policy.

 

7.6           In the event of any loss of or damage to any
property or premises at the Prescribed Gaming Hall and the VENUE OWNER
initiates claims against any insurance company, the VENUE OWNER shall give immediate notice to ELIXIR and upon reasonable request by the VENUE
OWNER, ELIXIR shall provide such reasonable
assistance to the VENUE OWNER in relation to the making of any appropriate
claim or claims under the relevant insurance policy.

 

8.             MODIFICATIONS

 

8.1           No modifications or amendments of this
Agreement shall be valid unless the same is made in writing and signed by the
authorized signatories of both VENUE
OWNER and ELIXIR to signify mutual agreement.

 

8.2           No waiver of any provision of this Agreement shall be valid unless made in writing
and signed by the authorized signatory of the party against whom it is sought
to be enforced.

 

8.3           The failure of a party at any time to insist
upon strict performance of any condition, promise, agreement, or understanding
as set forth herein shall not be construed as a waiver or relinquishment of the
right to insist upon strict performance of the same or other condition,
promise, agreement, or understanding at a future time.

 

8.4           Nothing herein shall be construed as to
create a relationship of partnership, joint venture, or agency between the
parties hereto and no agent, employee or contractor of either the parties
herein shall be deemed to be the agent, employee or contractor of the other.

 

18

 

9.             TERMINATION AND RETURN OF
MACHINES

 

9.1           Prior to the
expiration of the term of this Agreement, either ELIXIR or the VENUE OWNER may terminate this Agreement :-

 

(a)   by immediate
written notice to the other party (the “Defaulting Party”)
if the Defaulting Party is in material breach of any terms of this Agreement
and, where the breach is capable of remedy, the Defaulting Party has failed to
remedy the breach within 15 days of the date of a written notice from the
non-defaulting party is served to the
Defaulting Party specifying the
breach and requiring its remedy; or

 

(b)   by immediate written notice to the Defaulting
Party if the Defaulting Party goes
into liquidation (whether compulsory or voluntary except for the purpose of a bona fide reconstruction or amalgamation)
or bankruptcy or it shall become insolvent or enter into any composition or
scheme of arrangement with its creditors; or

 

(c)   by immediate written notice to the Defaulting
Party if the Defaulting Party is
found to be violating any provision of any Anti-Money Laundering Law (if
applicable) or any applicable law of the jurisdiction in which the Prescribed
Gaming Hall is located or any law of the jurisdiction in which the Defaulting
Party is incorporated, in relation to this Agreement and the transactions
contemplated hereunder ; or

 

(d)   if the
parties fail to reach an agreement after the good faith negotiations in
accordance with Clause 16 below; or

 

(e)   pursuant
to Clause 19 
below.

 

9.2           In addition to Clause 9.1 above, either the VENUE OWNER or
ELIXIR may terminate this Agreement by written notice to the other upon receipt
of directives from the Cambodian Government including revocation of the gaming
license to operate gaming and slot business at NagaWorld and more particularly,
the Prescribed Gaming Hall.

 

9.3           For the avoidance of doubt but without
modifying or limiting the respective parties’ rights under Clause 9.2 above, neither party shall
use any regulatory issues/ governmental requirement as a subterfuge to improperly
terminate this Agreement.  In case the
termination is due to Clause 9.2, and if within a
period of 12 months after the said termination, the Government’s instruction or
policies leading to the termination were subsequently lifted or, as the case
may be, the gaming license to operate gaming and slot business at the
Prescribed Gaming Hall, were subsequently re-granted to the VENUE OWNER, the
VENUE OWNER hereby agrees to give a first right of refusal to 

 

19

 

ELIXIR
for entering into a slot machine leasing arrangement on at least the same terms
of this Agreement. This provision shall survive until 12
months from the date of termination
of this Agreement.

 

9.4           Upon the
expiration or termination of this Agreement :

 

(a)   ELIXIR shall be entitled to
remove the Machines and any related equipment and systems, spare parts or
components used therein or thereof;

 

(b)   the VENUE OWNER shall
authorise ELIXIR and its personnel to enter into NagaWorld and more particularly,
the Prescribed Gaming Hall at reasonable time with prior appointment, to remove
and regain possession of the Machines and any related equipment and systems, spare
parts or components used therein or thereof supplied by ELIXIR hereunder and
all costs related to such removal and transportation (including but not limited
to the cost of insurance during transit) of the Machines and any related
equipment and systems, spare parts or components used therein or thereof
supplied by ELIXIR hereunder from the Prescribed Gaming Hall to the properties
belonging to ELIXIR (whether within or outside Cambodia) shall be borne by
ELIXIR;

 

(c)   on best endeavour basis,
the VENUE OWNER shall, upon the request by ELIXIR, provide all necessary
assistance in relation to the clearing of all applicable custom procedures for
the purpose of re-exporting from Cambodia the Machines and all related
equipment and systems, spare parts or components supplied by ELIXIR; and

 

(d)   if after deducting all relevant
payments, costs and/or expenses incurred on before the termination of this
Agreement in accordance with the terms of this Agreement and there is any
credit balance in the Marketing Fund, the same shall, as soon as reasonably
practicable, be returned to the respective parties according to their
respective contribution proportions, namely 25% thereof to ELIXIR and 75% to
the VENUE OWNER.

 

9.5           Any
termination or expiration of this Agreement shall be without prejudice to any
rights or liabilities of any party to sue or claim damages against the other
party accrued in respect of any breach of any other party of any of its
obligations (including any outstanding financial commitments) as provided under
this Agreement.

 

20

 

9.6           [Subject to Clause 9.5 above and to the extent permitted by applicable
law, neither party will be liable to the other on account of termination or
expiration of this Agreement for reimbursement or damages for the loss of
goodwill, prospective profits or anticipated income.]

 

9.7           Any terms or conditions of this Agreement which are capable of having effect after
the termination or expiration of this Agreement shall remain in full force and
effect following the termination or expiration of this Agreement.

 

10           OTHER TERMS

 

10.1         Nothing in this Agreement
or in any transaction effected under this Agreement shall constitute either
party or any of its employees or authorized personnel an agent of the other
party with respect to any matter whatsoever or in relation to any person.
Nothing in this Agreement or in any transaction effected under this Agreement
shall constitute the VENUE OWNER having any business or partnership
relationship with ELIXIR other than such business relationship as contemplated
under this Agreement. For clarity, the parties herby agree that the VENUE OWNER
has no other financial interest or any other interest in ELIXIR or its business
other than as specified in this Agreement. The VENUE OWNER has no part at all
to play in the promotion, management and operation of any aspect of ELIXIR’s
other business in Cambodia. Neither party shall not make any representation or
warranty to any person on behalf of the other party and shall not act or
purport to act on behalf of the other party in relation to any matter or
transaction except as specifically authorized (if any) under this Agreement or
with the prior written consent of the other party.

 

10.2      All the employees of the
VENUE OWNER and ELIXIR shall reasonably obey and comply with the “Rules & Regulations” of NagaWorld which means the rules and
regulations of NagaWorld as amended, supplemented or otherwise modified from
time to time, including but not confined to the House Rules, anti-money
laundering policies and procedures, Internal Control Rules and other rules as
may be subsisting or introduced by the VENUE OWNER from time to time and
generally apply to the entire NagaWorld.

 

21

 

11.          ASSIGNMENT

 

Neither
party shall be allowed to assign any of its interest or obligations under this
Agreement to any other person or entity without the express written consent of
the other parties.

 

12.          BINDING EFFECT

 

All terms
and conditions of this Agreement shall be binding upon, and inure to the
benefit of, the parties and subject to Clause 11 above,
their permitted successors and assigns.

 

13.          GOVERNING LAW

 

This Agreement and the rights and obligations of the parties hereunder
shall be construed and interpreted in accordance with and shall be governed by
the laws of Hong Kong and the parties hereby submit to the exclusive
jurisdiction of the courts of Hong Kong.

 

14.          TERM AND EFFECTIVITY

 

Subject
to any earlier termination in accordance with Clause 9 above, this
Agreement shall be valid for a period of Five (5) years beginning from the actual day of launching of the live commercial operation of the Machines at the Prescribed Gaming
Hall provided that such day shall not be later than 21 days (or such longer
period as may be approved by ELIXIR in writing) after the Machines have been
installed at the Prescribed Gaming Hall (the “Commercial  Commencement Date”).  The VENUE OWNER agrees that it will by
written notice confirm and inform ELIXIR of the Commercial Commencement Date.

 

15.          SETTLEMENT OF DISPUTES

 

15.1             If a dispute or difference shall arise
between the parties as to the interpretation of this Agreement or as to any
matter or thing of whatsoever nature arising under or in connection with this
Agreement, then the disputing party shall notify the other party in writing (“Notice of Dispute”).  Upon receipt of the
Notice of Dispute, the parties hereto shall be given 30
days to resolve the dispute and authorised representative of the relevant
parties shall meet and try in good faith to resolve the dispute.

 

22

 

15.2             If the dispute is not resolved within 30 days from
the date of the Notice of Dispute (or such other extended period as may be
mutually agreed by the parties) then the parties may refer the dispute for
litigation and submit to the exclusive jurisdiction of the courts of Hong Kong.

 

16.          RENEGOTIATION

 

In the
event that any fact and circumstance which may arise or be discovered which
render this Agreement void under the applicable requirements or instructions of
the relevant government authorities, the parties hereto agree to immediately
renegotiate in good faith with a view to revising its terms and conditions for
compliance with such requirements or instructions from the relevant government
authorities and in case the parties fail to reach a compromise within 90 days
from the commencement date of such negotiation or such period as may be
mutually agreed by the parties or prescribed by the applicable government
authorities, then either party may terminate this Agreement by giving to the
other party 14 days written notice at any time after the expiration of the said
negotiation period.

 

17.          NOTICES AND COMMUNICATIONS

 

Any
notice or other communications required or contemplated by this Agreement shall
be given in the English language by personal delivery or sent by a registered
mail letter, by facsimile or email at the following respective addresses (or such other address as may be specified by either party
to the other by written notice):

 

If to ELIXIR :

 

Address
: Units 2B & 3A, 29/F., The Centrium, 60 Wyndham Street, Central, Hong
Kong

 

Fax number : (852)-2147 3230

 

Contact Persons : Tony Lam and Edmond Choi

 

Email Addresses :
tonylam@elixirgaming.com and edmondchoi@elixirgaming.com

 

If to the Guarantor :

 

23

 

Address
: Units 2B & 3A, 29/F., The Centrium, 60 Wyndham Street, Central, Hong
Kong

 

Fax number : (852)-2147 3230

 

Contact Persons : Tony Lam and Edmond Choi

 

Email Addresses :
tonylam@elixirgaming.com and edmondchoi@elixirgaming.com and

 

If to the VENUE OWNER:

 

Any notice delivered or sent
in accordance with this clause will be deemed to have been given and received:

 

(a)   if delivered by hand, upon receipt;

 

(b)   if posted within Hong Kong, 3 days after posting or if posted overseas,
7 days after posting;

 

(c)   if sent by facsimile transmission, upon confirmation of correct
transmission of the facsimile and

 

(d)   if sent by email, the said email has to be sent to at least two contact
persons of the receiving party
and 24 hours after sending.

 

18.          MISCELLANEOUS

 

18.1         This Agreement and its annexure are the
complete and exclusive agreement between the parties with respect to the
subject matter hereof, superseding and replacing any and all prior
representations, agreements, communications, and understandings (both written
and oral and expressed or implied) regarding such subject matter (which
includes, but not limited to the former
agreement).

 

18.2         If any provision of this Agreement is found invalid or unenforceable,
that provision will be enforced to the maximum extent permissible, and the
other provisions of this Agreement will remain in force.

 

24

 

18.3         All headings to clauses herein are inserted
for convenience only and shall not be interpreted or affect the construction of
this Agreement. Words importing the singular number shall include the plural
and vice versa and a gender shall include all genders and the neuter. The
Recitals and Schedules attached hereto form part of this Agreement.

 

18.4         Unless required by
law, regulation or gaming authority or the
requirement of any stock exchange, each party agrees that it will not,
issue any news release, public announcement, or advertisement relating to this
Agreement or its subject matter, nor will it otherwise publicise this Agreement
or its subject matter, without first obtaining the written approval of other
party.

 

19.          FORCE MAJEURE

 

Force Majerure shall include events
beyond any party’s control include, but are not limited to, acts of God, war,
civil commotion, labor disputes, strikes, fire, flood or other casualty,
shortages of labor or material, government regulation or restriction and
weather conditions. In case of any force majeure event leading to a closure of
business of NagaWorld or more particularly, the Prescribed Gaming Hall, or
suspension of operation of a majority number of the Machines for more than 60
(sixty) consecutive days, either party shall be entitled to terminate this
Agreement by immediate written notice to the other party.

 

20.          CONFIDENTIALITY

 

20.1         Each party (the “Receiving Party”)
acknowledges that it may become acquainted with the confidential or proprietary
data or information in connection with this Agreement of the other party (the “Disclosing Party”). For the purposes of this clause,
confidential information shall include all the information provided to the
Receiving Party or which may become known to the Receiving Party as a direct or
indirect result of the performance by this Agreement, or otherwise in
connection with this Agreement. The Disclosing Party’s confidential information
shall include, without limitation, all the information that (i) by its
nature would reasonably be considered of a confidential nature or due to the
context in which the information was disclosed should have been reasonably
known by the Receiving Party to be confidential or (ii) is identified as
such by appropriate markings thereon or otherwise identified as confidential or
proprietary at the time of disclosure (collectively, “Confidential
Information”).

 

25

 

20.2         Subject to law, regulation or gaming authority or the requirement of any stock exchange, the Receiving Party agrees to hold the Disclosing Party’s Confidential
Information in confidence, to use same only if required for the performance of
its obligations under this Agreement and to refrain from disclosing same to any
third parties or to its own employees other than those (i) who reasonably
need to know the same for the performance of this Agreement, (ii) who have
been informed by the Receiving Party of the confidential nature of the
information and (iii) who are bound by written confidentiality agreements
with terms and conditions at least as stringent as the terms in this Agreement.
The Receiving Party shall be liable for any use of such information by its
employees or representatives in breach of this Agreement.

 

20.3         The Receiving Party
agrees to use the same degree of care to protect the Disclosing Party’s
Confidential Information as it would with respect to its own information of
like importance which it does not desire to have published or disseminated, but
in any event no less than reasonable care. If the Receiving Party faces legal
action or is subject to legal proceedings requiring disclosure of the
Disclosing Party’s Confidential Information, then, before disclosing any such
Confidential Information, the Receiving Party will promptly notify the
Disclosing Party and, upon the Disclosing Party’s request, cooperate with the
Disclosing Party in contesting such request. This Clause shall remain in effect
for a period of one (1) year after any termination of this Agreement;
provided, however, that if any such Confidential Information is reasonably
defined by the Disclosing Party as a trade secret, this Clause shall remain in
effect for so long beyond that period as such Confidential Information
continues to be a trade secret. All Confidential Information of the Disclosing
Party shall remain the property of the Disclosing Party and shall be returned
to it at its request.

 

IN WITNESS WHEREOF, the parties hereof caused this Agreement to
be executed on the date first above written.

 

 

	
  SIGNED
  by  

  	
  )

  	
   

  
	
   

  	
  )

  	
   

  
	
  for
  and on behalf of ELIXIR

  	
  )

  	
   

  
	
  GAMING TECHNOLOGIES

  	
  )

  	
   

  
	
  (HONG KONG) LIMITED

  	
  )

  	
   

  
	
   

  	
  )

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

26

 

	
  EXECUTED
  as a DEED by ELIXIR 

  	
  )

  	
   

  
	
  GAMING TECHNOLOGIES, INC.

  	
  )

  	
   

  
	
   

  	
  )

  	
   

  
	
  in the presence
  of :-

  	
  )

  	
  Authorised
  Signatory 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

	
  SIGNED
  by  

  	
  )

  	
   

  
	
   

  	
  )

  	
   

  
	
  for
  and on behalf of 

  	
  )

  	
   

  
	
  NAGAWORLD LIMITED

  	
  )

  	
   

  
	
  in
  the presence of :-

  	
  )

  	
   

  
	
   

  	
   

  	
  Authorised
  Signatory

  

 

27

 

Schedule A

 

Address
and location of the Prescribed Gaming Hall

 

The prescribed gaming hall  within NagaWorld,  the Hotel
Casino complex of the VENUE OWNER located at the south of Samdech Hun Sen’s
Park and the east of the Ministry of Cult and Religion Land, Phnom Penh, the
Kingdom of Cambodia. For the avoidance of doubt, the Prescribed Gaming Hall
comprises certain designated areas within Nagaworld agreed by the parties
hereto and more particularly identified as the areas highlighted in Yellow in
the floor plan of Nagaworld attached hereto.

 

28

 

Schedule B

 

List of Food and Beverages and other services
to be provided by the VENUE OWNER and the Charging Rate thereof

 

(A)          List
of drinks free of charge

 

(i)            Water

(ii)           English Tea

(iii)          Chinese Tea

 

(B)          List of services and
products to be charged at the rate of 60% of the Standard Commercial Rate as set
out in the Menu or in accordance with the Practice of NagaWorld

 

(i)            spa

(ii)           night club
facilities service

(iii)          karaoke

(iv)          hotel room

(v)           hotel facilities

(vi)          transportation

(vii)         food and beverage
other than those items as set out in (A) above

 

Save as set out above and subject to the
agreement by the Machines Operation Committee, all other products and/or
services provided by the VENUE OWNER shall be charged at the standard
commercial rate.

 

29Exhibit 10.50

 

	
  Heads of Terms- Elixir Gaming Technologies

  	
   

  	
  Confidential

  

 

 

Scientific Games Worldwide Limited

 

Agreement for the Provision of

Gaming Terminals, and license of

related software

 

to

 

Elixir Gaming Technologies
(Hong Kong) Limited

 

1

 

	
  Heads of Terms- Elixir Gaming Technologies

  	
   

  	
  Confidential

  

 

Confidential

 

HEADS OF TERMS FOR SUPPLY OF GAMING TERMINALS

ELIXIR GAMING TECHNOLOGIES (HONG KONG) LIMITED

 

This
Heads of Terms for the Supply of Gaming Terminals is effective on this the 19th day of NOVEMBER 2008.(the “Effective Date”)

 

PARTIES:

 

ELIXIR GAMING TECHNOLOGIES (HONG KONG) LIMITED a company incorporated under the laws of Hong
Kong with its principal place of business at Units 2A & 3B, 29/F., The
Centrium, 60 Wyndham Street, Central, Hong Kong (“EGT”);
and

 

SCIENTIFIC GAMES WORLDWIDE LIMITED, a company incorporated under the laws of
Ireland with its principal place of business at Athlone Road, Ballymahon, CO
Longford, Ireland.  (“SGW”).

 

RECITALS:

 

(a)           WHEREAS EGT is a
distributor and provider of networked gaming terminals, electronic gaming
machines and other gaming products and equipment in a number of jurisdictions,
including Cambodia, Vietnam and the Philippines, and is further entitled to
repair and maintain the said gaming terminals, products and equipment.

 

(b)           WHEREAS SGW owns and
is able to supply certain of its and/or its affiliated companies’ gaming
terminals (collectively “Gaming Terminals”
or “VLTs”) to EGT, and EGT is entitled
to operate or supply such Gaming Terminals to licensed premises in Cambodia, (or other agreed territories agreed by the parties”)  and is also able to supply and keep
updated games compendiums and related software to EGT for deployment of the
Gaming Terminals;

 

(c)           WHEREAS EGT wishes to
lease from SGW, and to place, the networked gaming terminals and related
software and equipment, including but not limited to those mentioned in Clause 1.1.3 below (hereinafter referred to as the “SGW System”) at the licensed venues
of its contractual partners (collectively the “Sites”), and the Parties also wish to conclude a
Service Level Agreement (“SLA”) for the
service and maintenance of such SGW System up to the appropriate levels of
service at such later time to be agreed by the Parties;

 

NOW
THEREFORE, the following is agreed:

 

OPERATIVE TERMS AND CONDITIONS:

 

Article I.                SCOPE
AND PURPOSE

 

1.1.
SUPPLY OF NETWORKED GAMING TERMINALS

 

1.1.1
SGW undertakes to supply, and EGT hereby accepts, Gaming Terminals as mutually
agreed from time to time by the Parties during the Term of this Agreement. As
at the Effective Date, the Parties have agreed that the following shall be
supplied in accordance with the terms and conditions of this Agreement:

 

(a) Two
hundred (200) Gaming Terminals of the type “SILVERBALL shall be supplied by SGW to EGT. These shall be
placed by EGT only in designated and licensed premises situated within such
territories which have been mutually agreed and approved by the Parties, which,
for the avoidance of doubt shall include the territory of Cambodia. The Parties
hereby agree that up to one hundred (100) of such total 200  Silverball Gaming Terminals (with the exact
amount to be agreed by the Parties as soon as reasonably practicable after the
Effective Date) shall first be shipped to EGT at an address in Macau to be
specified by EGT and in accordance with the terms of this agreement, which
shall then be installed in licensed venues in Cambodia as soon as reasonably
practicable by mutual agreement after the Effective Date. The remaining balance
of

 

2

 

	
  Heads of Terms- Elixir Gaming Technologies

  	
   

  	
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the
Silverball Gaming Terminals shall be shipped at such later date to be mutually
agreed by the Parties; and

 

(b) One
hundred (100) Gaming Terminals of the type “APEX”
which shall be supplied by SGW to EGT for placement only in designated and
licensed premises situated within the territory of Cambodia and/or other
licensed territories which have been mutually agreed and approved by the
Parties; and which shall be shipped and installed at a date to be mutually
agreed by the Parties.

 

1.1.2
Thereafter, and subject to Clause 1.2.3, SGW
undertakes to supply to EGT, which accepts, additional Gaming Terminals as
required by EGT from time to time for the duration of this Heads of Terms. Any increase in numbers of terminals over and
above those agreed to be supplied according to Clause 1.1.1.
shall be set out in a separate addendum to be governed by the terms of this
Agreement, and duly updated to Schedule 1 to this Heads of Terms.

 

1.1.3
The relevant back office system, central server, Epson computers/site
controllers for the operation of the Gaming Terminals shall likewise be
supplied by SGW.

 

1.1.4
In addition, SGW shall license and keep updated a games compendium to be
operated on the Gaming Terminals, and license the same to EGT in accordance
with the terms of the game and software license granted at Clause 7
of these Heads of Terms;

 

1.1.5 EGT hereby grants to SGW the exclusive right of first negotiation with
reference to a new agreement for supply of the SGW System (or any portion
thereof) and/or related services for any new Site in Vietnam for which EGT has
concluded a legally binding contract with the relevant owner(s) and/or
operator(s) of the Site for the supply of Gaming Terminals.  If EGT and SGW are unable to agree on the
terms and conditions governing the supply of the SGW System to Vietnam, to be
provided during an exclusive negotiation period of one (1) month from date
of written notification of the new opportunity, each Party shall be free to
negotiate with third parties for provision of Gaming Terminals thereafter in
Vietnam.

 

1.1.6 SGW hereby grants to EGT the exclusive right of
first negotiation with reference to a new agreement for supply of the SGW
System to the Republic of the Philippines for an exclusive negotiation period
of 6 months from the Effective Date (or such longer period as may be agreed by
the parties from time to time in writing).

 

1.2.
EVALUATION PERIOD

 

1.2.1.
The Parties agree that up to one hundred (100) SilverBall Gaming Terminals (with the exact amount to
be notified by EGT) shall be shipped by SGW as soon as practicable following
the Effective Date subject to the regulatory or governmental approval (if
applicable). The said SilverBall Gaming Terminals shall be onward shipped to
Cambodia as soon as reasonably practicable upon their arrival in Macau  and shall then be installed by EGT at its
approved  contractual partner’s venues in
Cambodia.

 

1.2.2.
The Parties agree that on or by the twelfth (12th) month from the Effective
Date (“First Assessment Date”) the
Parties nominated officers shall meet to assess the average performance of the
Gaming Terminals supplied to Cambodia. The assessment shall be used to
determine (i) the existing market conditions, (ii) the games software
supplied (iii) net income revenues derived from operation of the Gaming
Terminals and (iv) the cost to each of the Parties of any technical and
interface modifications as may be required and affecting the operation of any ,
of the Gaming Terminals supplied under this Heads of Terms, and (v) EGT’s
technical and field service operations and requirements.

 

1.2.2. On or as soon as reasonably practicable
following the First Assessment Date, the Parties shall agree on one of the
following courses of action:

 

(i)             Where the
average Royalty Fee due to SGW from Net Income (as defined in Clause 3.1 below) derived from SGW’s Gaming Terminals
achieves an acceptable level to SGW (an indicative figure is an average USD 8 per day per Silverball Gaming Terminal and USD 10 per day per Apex Gaming Terminal), and there is a
reasonable prospect the level may be maintained following any introduction of
tax and licence fees, and any technical modification as required, SGW shall be confirmed as a supplier of Gaming
Terminals to EGT on the terms of this Agreement, and shall supply additional
volumes as EGT may require from time to time in accordance with Clause 1.1;

 

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(ii)         Where the
average Royalty Fee paid to SGW from Net Income ( as defined per Clause 3.1)  derived from
SGW’s Gaming Terminals achieves less than the mutually acceptable level set out
at Clause 1.2.2 (i) above, the
Parties shall mutually agree to one of the following options:

 

(a)          EGT may
return the underperforming Gaming Terminals (or portion thereof), to the
control and possession of SGW by shipping the same to the relevant port of
Ireland at shipping and freight costs and any other
duties or charges relating to such shipment or exportation to be shared equally
by the Parties and EGT shall have no further obligation or liability
with respect to the returned Gaming Terminals. In case EGT has returned all the
Gaming Terminals and the SGW System pursuant to this sub-clause, then this
Agreement shall be deemed to have been terminated upon receipt of the Gaming
Terminals and relevant payment by EGT; or

 

(b)         permit the
Gaming Terminals to remain in operation on those Sites and in such case, SGW
may choose to supply new game content, and EGT shall use best endeavours to
provide alternative locations for the operation of the VLTs which shall remain
in operation for a further twelve (12) months from the First Assessment Date
(such 24 month period from the Effective Date referred to as the “Second Assessment Date”). The
operation of the VLTs shall be assessed against required indicative thresholds
as set out at Clause 1.2.2. (i) following
which EGT shall confirm EGT as a
supplier of Gaming Terminals to EGT on the terms of this Agreement or if the
average Royalty Fee paid to SGW from Net Income ( as defined per Clause 3.1)  derived from
SGW’s Gaming Terminals during the second contractual year still achieves less
than the mutually acceptable level set out at Clause 1.2.2
(i), then SGW may require that the VLTs shall be returned in whole
or in part  in accordance with Clause 1.2.2. (ii) (a)at any time after the Second
Assessment Date.

 

For the avoidance of doubt, unless pursuant to
the provisions of Clauses 1.2.2. (ii) (b),
12.1, 12.1A, 12.2, 12.3, 12.4, and 22  below,
SGW shall have no right to terminate this Agreement, in particular, prior to
the First Assessment Date. In case of any unlawful termination of this
Agreement by SGW, SGW shall, without prejudice to other damages or
compensations to which EGT may be entitled under applicable laws, reimburse to
EGT of its relevant share of taxes and duties as mentioned in Clause 4.5 and the relevant shipment costs (including but
not limited to insurance and freight charges) as mentioned in Clause 9.2 together  with  the insurance costs, if any, incurred by it under Clause 5.10.

 

1.2.3 EGT may at any time request SGW to provide
additional Gaming Terminals in excess of the 100 (one
hundred) units of the type “APEX” and 200 (two hundred) units of the type “SILVERBALL”
which have shall have been supplied in accordance with Clause
1.1.1. (such excess gaming terminals hereinafter referred to as the “Additional Units”), and upon receipt of such request, SGW
shall be obligated to supply any Additional Units in accordance with the terms
of this Agreement Provided That
if such Additional Units were installed prior to the First Assessment Date SGW
may, although it shall not be obliged, to determine, that any additional APEX
Gaming Terminals contained in Additional Units, shall attract a minimum fixed
rental fee of USD 10 per day, and Silverball Gaming Terminals comprised in the
Additional Units shall attract a minimum fixed rental fee of USD 8 per day only
until the First Assessment Date (without prejudice to higher amounts due should
the Net Income allow) following which the Gaming Terminals shall be evaluated
on the First Assessment Date together with other terminals supplied in
accordance with this Clause 1.2. (in
a separate evaluation sample).

 

1.2.4 SGW agrees that it shall not provide APEX or SILVERBALL Gaming Terminals
to any other third party in the Cambodia prior to the First Assessment Date.
Any further periods of exclusivity will be mutually agreed based on the outcome
of the evaluation period as set out at clause 1.2.2.
above, (First Assessment Date and at the end of the Second Assessment Date,
where applicable according to clause 1.2.2(ii)(a) or  clause1.2.2(ii)(b)). For the avoidance of doubt, nothing contained
in this Agreement shall preclude EGT, at any time before or after the date of
this Agreement, from leasing electronic gaming machines or terminals that have
the same or similar specifications or functionalities as the Gaming Terminals
from other third parties for use in Cambodia (or agreed authorized market); .

 

Article 2:
SITE APPROVAL

 

2.1 SGW shall be
required to approve (such approval not to be unreasonably withheld or delayed)
the location of the Sites nominated by EGT prior to the installation or supply
of SGW’s Gaming Terminals.

 

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2.2 Subject to the
provisions of Clause 1.2, Clause 3.4 and any earlier termination of this Heads
of Agreement, the Parties further agree that once supplied, each Gaming
Terminal shall remain sited and operational for a minimum five (5) year
period.

 

2.3 For the avoidance of
doubt, EGT will supply the Gaming Terminals only to contractual partners who
hold the permits necessary for the operation of the Gaming Terminals in
Cambodia and which additionally have undertaken to sign and to comply with SGW’s
standards and warranties (subject to such modifications of standards or
warranties as may be approved by SGW, such approval not to be unreasonably
withheld or delayed) as further detailed at Schedule 2
of this Agreement, and as may be notified in writing to EGT from time to time.
EGT shall further use best endeavours to ensure that such contractual partner
does not set up or operate the Gaming Terminals outside of  Cambodia (or other authorized market);  as had been specifically agreed in writing
for deployment of the agreed Gaming Terminals. Should reasonable suspicion
arise that one or more of EGT’s contractual partners does not meet the
statutory requirements or is operating the Gaming Terminals outside of
Cambodia, EGT shall grant SGW access to a complete list of the names and
addresses of such defaulting contractual partners. In addition, EGT will
immediately take all reasonable steps within its power in order to stop the
distribution and the use of Gaming Terminals outside of Cambodia. EGT will
fully indemnify and hold harmless SGW for all damages (including reasonable expenses
and costs) arising out of either (a) any such illegal or unauthorized
supply by EGT itself; or (b) EGT’s failure to take reasonable steps within
its power to stop any such illegal or unauthorized supply by its contractual
partners.

 

Article 3:  ROYALTY FEE

 

3.1.
EGT shall pay to SGW for the supply of the SGW System a royalty fee to be paid
as follows:

 

3.1.1. A Royalty
Fee of 50% (fifty percent) of Net
Income derived from operation of the Gaming Terminals, where “Net Income” is the amount which
remains from the total amounts staked on the Gaming Terminals by players less (i) the
total amount  paid out in winnings to
players ,(ii) less subject to the provisions of clause 3.4,
relevant gaming taxes which may become 
payable through operation of the VLTs, (iii)  less EGT’s  contractual partners’ share of revenue and (iv) less,
subject to the provisions of Clause 3.4,any
irrecoverable foreign entity withholding tax, should the same become payable in
Cambodia paid or to be paid by the contractual partners before distributing EGT’s
share to EGT and to SGW). No further deductions from the Royalty Fee shall be
permitted unless expressly agreed in writing herein.

 

3.2. Software and game updates are provided by SGW free of charge, and
subject to the provisions of Clause 6.6., spare parts shall also
be supplied by SGW free of charge.

 

3.3. The Parties acknowledge and agree that
where any Gaming Terminal at any one Site on any one week generates negative Net Income (as defined in Clause 3.1.1 above)  then the total amount of such loss shall be
set against other Net Income generated by the other Gaming Terminal(s) for
that Site during that accounting period, and where a loss still remains then it
shall be set against aggregate Net Income Revenue throughout EGT’s estate (but
only within Cambodia (or other authorized market); ) during that accounting
period and from one accounting period to the next until the loss is
extinguished.

 

3.4. The Parties further agree the Royalty Fee
payable under Clause 3.1.1 of this Heads of Terms
shall be revised if and
where there is a change in taxation policy, legislation or practice, which
results in a material change to the intent or effect of this Agreement or
affects the financial effect of either party to an appreciable extent under this
Agreement. The party so affected shall notify the other party in writing as
soon as practicable of such effect. Both parties agree that, in the event such
change  has a material adverse impact on the  economic interest of either party, they will in good faith
seek to negotiate new commercial terms within a reasonable time frame taking
into account the material change. This clause also applies in the event that
there is any change in legislation which requires a modification of the Gaming
Terminals in accordance with additional standards and specifications and which
EGT or SGW is obliged or agreed to comply with. For the avoidance of doubt, in
such circumstances enumerated by this Clause 3.4, the terms of this Agreement
shall continue for a period of three (3) months unless and until new terms
are agreed in writing. Where agreement has not been reached, either Party may
exercise its rights of termination under Clause 12.4.

 

Article 4.  REPORTING, PAYMENT, TAXES AND AUDIT

 

4.1.
EGT undertakes that the Royalty Fee as set out above is made on a
monthly basis in arrears.

 

4.2. Royalty Fees and payments made under this
Heads of Terms are payable in United States Dollars.

 

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4.3. EGT shall provide, within five (5) business
days (excluding Saturday, Sunday and public holidays in Hong Kong) from the end
of each month, a statement containing data relating to performance of the VLTs,
and SGW shall raise an invoice in respect of the Royalty Fees due for each
monthly period as soon as practicable thereafter. EGT undertakes to effect
payment on or by the thirty (30th) day of the date of the invoice.

 

4.4.  EGT shall
submit to SGW on a weekly basis information including, but not limited to,
performance data of the VLTs for each Site for billing and other purposes in
the manner agreed between the Parties. This financial information shall be
audited annually and shall likewise be subject to the internal controls and
processes as may be agreed with the Sites. EGT also agrees to ensure that clearance and
accounting procedures as notified to it by SGW from time to time for the VLTs
are strictly adhered to by EGT’s staff working at the Sites as may be required.

 

4.5. All Royalty Fees and payments are exclusive of sales tax, value added
tax or any tax or importation duties, fees or charges. The parties agree that:

 

(a) importation
charges and duties for importing the Gaming Terminals into Macau shall be borne
by SGW or reimbursed to EGT by SGW;

(b) all
exportation taxes or duties for exporting the SGW System from Ireland shall be
borne by SGW until the point of delivery in Macau;

(c) all
exportation taxes or duties for exporting, storage or holding terminals in bond
prior to re-exporting the SGW System from Macau to Cambodia and/or other
territories which have been mutually agreed and approved by the Parties, shall
be shared by EGT and SGW on an equal basis, and EGT shall be reimbursed for 50%
of all reasonable costs incurred for arranging such export and/or storage; and

(d) importation
taxes or duties for importing the SGW System into Cambodia shall be paid by EGT
or its customers acting as the Importer of Record as appropriate.

 

4.6. EGT shall also pay,
on behalf of the SGW any withholding tax (if applicable) due on payments made
to SGW and undertakes that it has the obligation to provide SGW with proof of
payment or certification of taxes paid as withholding taxes, if any, in Hong
Kong on an annual basis. SGW undertakes to provide EGT with a certificate of
its Irish tax residence on an annual basis.

 

4.7. Where EGT fails
to pay any amount payable within the time period stipulated in Clause 4.2, SGW shall be
entitled to charge EGT interest on the overdue amount, payable by EGT on demand,
from ten (10) days after the due
date up to the date of actual payment at the rate of 2.5% above LIBOR or the
highest amount allowable by the applicable law. Said default rate shall apply with respect to all amounts
due under this Agreement.   If EGT fails
to pay in any consecutive two (2) month period any amount owed to SGW
within the dates indicated in the contract, SGW will be entitled to terminate
this contract immediately and automatically.

 

4.8. In the event that there is any discrepancy
between EGT’s statement data and SGW’s own data, the data which is retrieved
from EGT’s records shall prevail, unless SGW is able to show good cause. Where
EGT and SGW agree that there is an error in any statement and/or invoice, on
notification of such in writing to SGW, SGW shall issue a credit note where the
amount invoiced was higher than required, or an additional invoice for the
remaining amount due, as applicable. Where the Parties agree that there is a
discrepancy in any monthly statement or invoice, the tax authorities shall be
notified where applicable and the correct amounts shall be paid.

 

4.9. Not more than twice in any contract year,
SGW shall have the right to appoint an independent third party auditor who
shall have the right upon 48 (forty-eight) hours prior notice to EGT during
reasonable business hours to inspect and audit the documents and records of EGT
regarding the operation of the VLTs. This right shall only apply to those
records evidencing operation of SGW’s VLTs. 
EGT shall maintain sufficient records to permit such inspection and
auditing for 3 (three) years after the close of each respective accounting
period.  The Parties agree that all costs
of such audit shall be borne by SGW unless the audit shows a difference of more
than 5% (five percent) between the Royalty
Fees paid in the previous 12 month period and the Royalty Fee which ought to
have been paid and in such case, the audit fee shall be equally shared between
EGT and SGW.

 

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Article 5:  OBLIGATIONS
OF EGT

 

EGT shall be responsible for and undertakes the following:

 

5.1. Networking of equipment: Subject
to a successful outcome of the evaluation period in accordance with Clause 1.2.2.,
EGT agrees to appoint and employ a Project Manager to assist SGW in its
certification of the Gaming Terminals as may be required (if any) from time to
time in Cambodia (or other authorized market). The appointed Project Manager
shall be assigned the responsibility of interfacing the SGW System with any
networking or other technical requirements in Cambodia (or other authorized
market); he or she will liaise with the authority responsible for gaming and
technical certification of the Gaming Terminals (other than GLI approvals
already sought and obtained for the APEX Gaming Terminals) and ensure
compliance with the laws in Cambodia (or other authorized market). All legal
and regulatory requirements affecting operation of SGW’s Gaming Terminals
shall, notwithstanding the foregoing, be notified to SGW.

 

5.2. Communications:   EGT
agrees to provide or procure that its contractual partners of the Sites to make
available a reliable DSL Broadband Connection or other suitable electronic
communication to a specification supplied by SGW at each Site from a
telecommunications provider of good repute for the correct functioning of the
network. In addition, EGT shall provide or procure its relevant contractual
partner to provide, a telephone line at each Site at its own (or its
contractual partners’) cost.

 

5.3. Conditions relating to the Gaming
Terminals: EGT agrees that it shall (i) not
remove or permit (to the extent within its authority and control) to be removed
any label attached to any Gaming Terminal stating it is the property of SGW; (ii) not
do anything to sell, assign, pledge, encumber or charge the Gaming Terminals in
any way; (iii) not move any part of the equipment, nor permit (to the
extent within its authority and control) that any part of the equipment be
removed from the Site once installed, unless with prior consent of SGW; (iv) Not
to use or permit (to the extent within its authority and control) to be used
the Gaming Terminals in contravention of applicable laws and regulations, or
the written instructions communicated by SGW to EGT from time to time.

EGT
shall indemnify and keep indemnified SGW against any loss of equipment, or any
other liability incurred by SGW which liability arose out of the breach of EGT’s
obligations under this clause 5.3.

 

5.4  Clearing and Accounting Procedures:
EGT undertakes to ensure that Gaming Terminal clearance and accounting
procedures as notified by SGW, are strictly adhered to by EGT’s staff or
sub-agents working at the Sites and carried out at each Site once on each day
the Site is open for business. Where the Sites are not operated by EGT itself,
EGT undertakes to SGW that it will use its best endeavours to procure that
these procedures will be adhered by the respective contractual partners in the
Sites.

 

5.5.
Distributors of Gaming Machines to contract partners-Required Approvals:
Prior to any supply or installation. EGT shall submit the
name, and address of its contractual partners to SGW, which undertakes that,
within five (5) working days from the request by EGT, it will respond as
to whether that contractual partner is approved (such approval not to be
unreasonably withheld or delayed) as operator of SGW’s Gaming Terminals in
accordance with SGW compliance procedures and processes. In addition, EGT shall
procure that such approved contractual partners shall sign the standard
warranties and representations contained in this Agreement at Schedule 2 (subject to such modifications of standards or
warranties as may be approved by SGW, such approval not to be unreasonably
withheld or delayed) , and shall remain properly licensed at all times of
operation of the Gaming Terminals. EGT will be responsible for ensuring that
each of its approved contractual partners is aware of the terms of this
Agreement which affect that approved partner and shall use its reasonable
endeavours to ensure that the approved partner complies with the terms of this
Agreement. EGT shall further take reasonable precautions to ensure that the
approved contractual partner does not, without any valid reason, switch off or in any way disable  any part of the SGW System without the
agreement of  SGW.

 

5.6.  Provision
of Data: EGT agrees to provide data
relating to the Gaming Terminal and to their operation, including but not
limited to, details of their turnover and volumes. This information may be
provided only as allowed under the applicable laws protecting confidentiality
of the game data.

 

5.7. Alteration to Software: EGT agrees
and warrants that it will not itself and will not permit (to the extent within its authority and
reasonable control)   any third party to alter or modify the whole
or any part of the Gaming Terminals hardware, software, or games licensed and
provided by SGW hereunder, nor permit (to the extent within its authority and control) the whole or any part
of the same to be combined with, or become incorporated in, any other program,
nor will it copy, decompile, disassemble adapt or reverse engineer the same,
nor attempt to do any such things, nor will it make copies of any documents relating
to the Software and Games, except as may be expressly permitted by SGW in
writing.

 

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EGT
shall indemnify and keep indemnified SGW against any intellectual property
breach, or any other liability incurred by SGW which liability arose out of the
breach of EGT’s obligations under this clause 5.7.

 

5.8. Inspection
of Sites: EGT shall permit or shall procure its relevant contractual
partner of the Site to permit SGW to inspect and to have access to any Site
where Gaming Terminals are supplied and installed for the purpose of ensuring
that the terms of the software license, and the confidential data obligations
of EGT are complied with, such inspections to take place only on reasonable
prior written notice.

 

5.9. Health
and Safety: EGT shall be responsible in accordance with applicable laws for
the safety of all of its own employees and personnel  employed to carry out obligations on EGT’s
behalf for the provision of services under this Agreement and EGT undertakes to
comply with all reasonable and relevant health and safety directions notified
by SGW in writing in relation to the equipment supplied

 

5.10.
Security and Vandalism: EGT undertakes to ensure that its contractual
partners shall be fully liable for any third party criminal damage or vandalism
to the Gaming Terminals whilst these  are
in storage or on Sites within Cambodia and shall further maintain reasonably
adequate security of their operations and access to data, and shall be
responsible for the costs associated with replacement parts due to vandalism,
criminal damage or otherwise through negligence (save and except for negligence
or any damage caused by SGW, its employees or agents). EGT shall indemnify and
hold harmless SGW for any loss or damage caused to the Gaming Terminals in this
respect. Without prejudice to the obligations of EGT herein, EGT may, at its
sole discretion, decide to insure (at its costs) by itself or require SGW
to insure (but with the relevant reasonable insurance costs to be reimbursed by
EGT) the Gaming Terminals and the SGW System with such reputable insurance
companies against all loss or damage to them. For the avoidance of doubt, (i) insurance of the Gaming Terminals
shall be maintained by SGW up to the agreed point of delivery in Macau; and (ii) if
the insurance for the full replacement costs of the Gaming Terminals and the
SGW System has been taken out at EGT’s costs under this provision, then in case
of any damage to the Gaming Terminals and/or SGW System due to vandalism,
criminal damage or otherwise through negligence, SGW shall not be entitled to
any double recovery of its loss from both EGT and the relevant insurance
company.

 

Article 6: SGW’s OBLIGATIONS

 

SGW undertakes to provide the following supplies
and services to EGT:-

 

6.1. Supply
of Equipment:  SGW will
provide the Gaming Terminals and site hardware to support operation of the
Gaming Terminals for use on each of the Sites allocated and agreed by the Parties
in accordance with Clause 2;

 

6.2. Certification: SGW shall be responsible, with the reasonable
assistance of EGT, for the costs associated with any development work
associated with achieving certification and compliance of the Gaming Terminals
with notified regulations and standards (if applicable) to allow for
distribution of Gaming Terminals and the SGW System in Cambodia.

 

6.3. Network: SGW shall work with EGT to set up a private
communications network for functioning of the equipment supplied, and shall
provide remote maintenance services to the SGW System and Gaming Terminals on
an “as-required” basis (and as permitted by applicable laws in Cambodia)..

 

6.4. Training and Manuals: SGW shall provide initial basic training on the Gaming Terminals to EGT’s
and its customer appointed staff. SGW undertakes to send, at its cost, a qualified technical
person for a minimum of one week to provide onsite training as required in
Manila and/or Phnom Penh as required. In addition, a technical manager shall be
appointed to administer operation of the 
VLTs provided under the terms of this Agreement and shall remain in
Cambodia or other place (to be agreed by the Parties) as reasonably required to
support the installation process for a minimum of sixty (60) days. In addition,
SGW shall provide installation manuals for EGT or its
customers to be able to provide fault fixing and maintenance of the Gaming
Terminals as required.

 

6.5. Dedicated
Website: SGW shall provide reasonable access to EGT to a dedicated web
interface of SGW in order to extract Site performance and other related data
for the Gaming Terminals installed in the Sites in Cambodia (or other
authorized market);

 

6.6. Spare
Parts: as soon as reasonably practicable after the Effective Date a
suitable stock of spare parts for the Gaming Terminals shall be provided free
of charge, and faulty parts shall be replaced on a one for one basis in order
for EGT to maintain and service the Gaming Terminals up to the service
standards required by EGT or pursuant to the SLA (if signed) as contemplated
under Recital (C) above. Those Gaming
Terminals which are shown to have been replaced due to faultiness or breach of
manufacturer warranty shall be replaced at the cost of SGW. Where such
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criminal
damage on Site, replacement Gaming Terminals shall be supplied and replaced at
cost of EGT (or the relevant contractual
partners of EGT as the case may be in accordance with Clause 5.10
above)

 

6.7. Games Content:
The games content for
operation on the Gaming Terminals shall be solely supplied by SGW (and its
affiliates’) and shall be mutually agreed by the Parties subject to regulatory
approvals as may be required in Cambodia.

 

6.8. Updates: SGW undertakes to
consult EGT about new hardware or software which may enhance the Gaming
Terminals — however, subject to compliance at all ties with applicable laws and
regulations, the discretion to implement such proposed changes shall remain
with SGW, unless otherwise agreed on a case by case basis.

 

Article 7:
SOFTWARE AND GAMES CONTENT LICENSE

 

7.1.SGW
System: Subject to the restrictions at Clause 7.3, SGW hereby grants EGT a non- exclusive, non-transferrable license (in object
code only), and limited in time until the expiry or termination of this Heads
of Terms, and for use solely within Cambodia, for use of the gaming platform
software and related back office game systems in order to install the games on
the Gaming Terminals supplied by the SGW.

 

7.2. Games
Compendium:  Subject to
the restrictions at Clause 7.3 ,
SGW hereby grants to EGT a non-transferable, non-perpetual licence to use,
lease and enjoy the Games Compendium on those Gaming Terminals supplied by SGW
under this Heads of Term and associated Game Intellectual Property, for the
purposes of carrying on the business of EGT and its permitted contractual
partners, as set out in this Heads of Terms. EGT shall be entitled to sub-license
the license hereby granted for use of the Games Compendium to its contractual casino operator partners in Cambodia on the same terms
and with the same restrictions as are contained within this Heads of Terms

 

7.3
Licence Restrictions: EGT shall not and shall procure its contractual partners  not to permit any third party to utilise or
to gain access to this licensed intellectual property. The license grant shall
be restricted strictly for use solely in Cambodia (and other markets as
expressly agreed) and strictly for the duration of this Heads of Terms and
subject always to EGT paying the Royalty Fees. In particular, EGT is prohibited from rebuilding,
deconstructing, reverse engineering or copying the hardware, the Games
Compendium, the SGW System or the gaming platform software of the Gaming
Terminals, system and/or communications network supplied and/or component parts
of any of the foregoing except as expressly permitted by applicable law.

 

Article 8.
INTELLECTUAL PROPERTY RIGHTS

 

8.1.
EGT acknowledges and agrees that SGW has and at all times will retain all
right, title, ownership and interest  in
the SGW System,  Games compendiums
supplied,  and all information and
software documentation, trademarks, logos, patents and associated intellectual
property (including without limitation any copies and derivative works thereof)
and including all intellectual property rights therein and thereto.  All additions, attachments, accessories and
repairs at any time made to or placed upon Gaming Terminals or Games Compendium
supplied shall be and remain the property of SGW.  EGT shall not in any way assert for itself,
or attempt in any manner to transfer, sell, assign, license or distribute any
right, title or interest in the Games Compendium, the SGW System or the software
supplied (or any part thereof).

 

8.2.
In the event that EGT breaches or otherwise infringes any of the intellectual
property rights subject of the Games Compendium supplied, related game content,
artwork, game software provided and supplied under this or other Agreement, EGT
will be liable to pay to SGW damages, legal costs and fees, including loss of
profit, costs and expenses. In the event that any of EGT’s contractual partners
breach or otherwise infringe any of the intellectual property rights subject of
the Games Compendium supplied, related game content, artwork, game software
provided and supplied under this or other Agreement, EGT shall use best efforts
to provide all reasonable assistance to SGW in taking appropriate actions
against such defaulting contractual partner(s) of EGT.

 

8.3.
SGW undertakes to take reasonable precautions against abusive manipulation of
the software by unauthorized third parties on a suitable scale which shall
correspond to the state of the art as currently available, and shall be
responsible for the correctness and completeness of the documentation to be
provided by it in relation to operation of the Gaming Terminals.

 

8.4.
Notwithstanding anything to the contrary contained herein, it is agreed by the
Parties that all data and information on or regarding the players of the Gaming
Terminals collected by the SGW system and/or or software supplied by SGW hereunder shall at all times be commonly owned by EGT
and SGW. For the avoidance of doubt, at any time after any expiry or
termination of this Heads of Terms, each Party shall be

 

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free
to make use of such player data or information to facilitate or for pursuance
of its own business to the exclusion of any confidential data in relation to
the SGW System or the Games Compendium which know how and information shall at
all times remain the sole and exclusive property of SGW.

 

8.5
This clause shall survive termination or expiry of this Heads of Terms for a
period of 5 (five) years from the date of expiry or termination thereof.

 

Article 9:IMPORTATION
AND INSTALLATION

 

9.1.
Delivery and Shipping:  SGW shall have available the Gaming Terminals being
supplied under this Agreement for shipping Origin (the European Union) on CIF
Terms (Cost, Insurance and Freight) to Macau on a date agreed between the
parties taking into consideration EGTs delivery schedule drawn up by EGT and
SGW according to the timeline as may be requested by EGT or EGT’s contractual
partners and agreed by the Parties. The address in Macau shall be notified to
SGW at least three (3) weeks prior to the shipment date for any new
terminals. In the event that any delivery is not possible within the time frame
originally agreed or intended, SGW shall notify EGT five(5) days
beforehand in writing and the parties shall agree on a future reasonable
delivery date to allow for third party delays, or delays which may be due to
obtaining proper documentation.

 

9.2. Importation of Gaming Terminals: EGT undertakes that it shall act or as the case may be, shall procure
its relevant contractual partner to act, as the Importer of Record in relation
to the importation of the Gaming Terminals into Macau, and shall also provide
adequate storage facilities for equipment supplied pending their supply, onward
shipment and installation into agreed Sites within Cambodia or other authorized
territories to be agreed by the Parties. Onward delivery (Cost, Insurance and
Freight) to Cambodia or each  authorized
market from the point of delivery in Macau notified in accordance with Clause 9.1. shall be at the responsibility, cost and expense
of the parties in equal share. The respective responsibilities of the Parties
regarding payment of the relevant import and/or export taxes and duties are
more particularly set out in Clause 4.5 above.

 

9.3
Installation: EGT shall install the Gaming Terminals at the Sites within
Cambodia (or  other authorized market),
subject to SGW providing the necessary assistance and initial training to EGT
personnel for proper installation of the first gaming terminals supplied in
accordance with Clause 6.4.

 

Article 10:  WARRANTIES AND REPRESENTATIONS

 

10.1.
EGT undertakes that it shall hold and maintain in force all relevant license
(if necessary) within Cambodia (or other authorized market) for the
distribution, importation, operation (if applicable) and supply of Gaming
Terminals and that it shall comply with the conditions of such license in order
to perform its obligations under this Heads of Terms.

 

10.2.
Each Party binds and warrants to the other Party that it shall be bound by and
comply with the applicable warranties and representations contained at Schedule 2 to these Heads of Terms.

 

Article 11.
TERM

 

11.1.
This Heads of Terms shall be valid upon as from the Effective Date and shall
continue for a minimum period of five (5) years there from (the “Term”) unless earlier terminated in
accordance with its terms and all applicable provisions of this Heads of Terms
(including the liability of EGT to pay the Royalty Fee) shall apply to the
operation of all Gaming Terminals throughout the period of deployment in
accordance with this clause.

 

11.2.
Where neither party has given prior notice to the other party at least sixty
(60) days prior to expiry of the Term at any time to the other for termination,
this Agreement shall be automatically renewed for further twelve (12) month
periods on the same terms and conditions as expressed in this Heads of Terms.
(the “Extended Term”)

 

11.3.
Notwithstanding the above, where the Term (or Extended Term as applicable) has
expired and notice of termination has been served on the other, the Parties
undertake that they shall in good faith exclusively negotiate the possibility
of not terminating the Agreement and the renewal thereof during the period
commencing sixty (60) days prior to the
expiration of this Heads of Terms at the end of which, this Agreement shall be
terminated without requirement for further notice.

 

Article 12.
TERMINATION

 

12.1.
Either Party (“Non-defaulting Party”) may give
fourteen (14) days notice in writing to the other 

 

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Party
(“Defaulting Party”) terminating this
Heads of Terms forthwith:

 

12.1.1.
if the Defaulting Party commits a material breach of these terms which is not
capable of remedy (and, where the breach is capable of remedy, fails to remedy
the same within thirty (30) days (or such longer period of time as may be
agreed by the Non-defaulting Party in its absolute discretion) of the date of
written notice from the Non-defaulting Party so to do);

 

12.1.2.
if an order is made or a resolution is passed for the winding up of the
Defaulting Party , or an order is made for the appointment of an administrator
to manage the affairs, business and property of the Defaulting Party, or such
an administrator is appointed, or documents are filed with the Court for the
appointment of an administrator, or notice of intention to appoint an
administrator is given by the Defaulting Party or its directors or by a
qualifying charge holder, or a receiver is appointed of any of the Defaulting
Party’s assets or undertakings, or circumstances arise which entitle the Court
or a creditor to appoint a receiver or manager or which entitle the Court to
make a winding-up order, or any other party takes or suffers any similar or
analogous action in consequence of debt.

 

12.1A      In addition to the above, SGW may also
terminate this Heads of Terms by immediate written notice to EGT :

 

12.1A.1.
if EGT is in default by making an unauthorized use, copying or distribution of
the software, games of hardware and equipment supplied in breach of the terms
of the licence granted in accordance with Clause 7;

 

12.1A.2.
the necessary permits or licenses (if any) of EGT are suspended, revoked or
otherwise not renewed by the relevant regulatory bodies (if applicable) in
Cambodia (or other authorized market). For the avoidance of doubt, the
suspension or revocation of the relevant permits or licenses by the regulatory
authority shall not by itself be regarded as a default on the part of EGT;

 

12.2.  In the event that in that legislation or
regulations are introduced which ban in whole or in part the operation of the
Gaming Terminals in Cambodia or other agreed territory in this Heads of Terms,
or the same shall be prohibited or become illegal by statute or court decision
or by action of any cognizant governmental agency, the Term of this Heads of
Terms shall be deemed to have terminated as of the date of such prohibition or
cessation of such allowance for Gaming Terminals to be operated, but without
prejudice to the rights of either Party up to the date of termination.

 

12.3 In the event that either of the Parties or
any affiliate of that Party acquire or have control or influence over, or are
controlled or influenced by, any Party or person or business entity which shall
be deemed (in the reasonable opinion based on the results of the background due
diligence as contemplated below) by the first Party to be a conflict of
interest or is likely to result in a material adverse change in the legal,
regulatory, ethical or financial prospects of the other Party, the first Party
may terminate this Agreement by immediate written notice in writing.  For the avoidance of doubt this shall include
the successful completion of a background due diligence investigation of that
Party, person or business entity by the relevant Party.

 

12.4. Either Party may terminate on fourteen
(14) days further notice where the Parties have been unable to agree new
commercial terms within three months from the start of the negotiation period
in accordance with Clause 3.4.

 

12.5         In
addition to the above, this Agreement shall be deemed terminated without
further notice once EGT has returned all the Gaming Terminals and SGW System in
accordance with Clause 1.2.2 (ii)(a) or Clause
1.2.2(ii)(b).

 

12.6. Termination under this Clause 12 shall be
without prejudice to any rights which may have accrued to either of the Parties
prior to such termination.

 

Article 13:
CONSEQUENCES OF TERMINATION

 

13.1
Upon expiry or termination for whatever reason, EGT is obliged to remove all of
SGW’s Gaming Terminals, SGW System, 
properties, materials and equipment from EGT’s and any of its
contractual partners premises where Gaming Terminals are sited according to an
Exit Plan (to be agreed by the parties in good faith)  for Cambodia (or other authorized market);
The costs (including but not limited to insurance and freight charges) of such
removal and all the taxes and duties relating to the re-exportation of the SGW
System out from the relevant authorized market);  shall be shared by the parties equally unless
the termination is due to the default of any one party in which case all such
costs and duties shall be borne by the defaulting party. To the extent that the
removal process is not carried out due to EGT’s default, SGW 

 

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shall
be granted unrestricted access to all premises where the SGW System or Gaming
Terminals are installed, and EGT will reimburse all costs and expenses
associated with the removal and shipping of all such SGW’s equipment to the
relevant port in Ireland.

 

13.2.
EGT shall return to SGW all and any software,
intellectual property licensed hereunder or documentation, and each party shall
return to the other any documents, copy or other material containing
Confidential Information which belongs to the other Party.

 

13.3. Each Party shall
make any outstanding and payable fee or debt due to SGW under this Agreement
within a maximum period of thirty (30) days of termination.

 

13.4 Clauses 3
(Obligation to pay the Royalty Fee) Clause 8 (Ownership of Intellectual
Property), Clause 13 (Consequences of Termination), Clause 15 (Confidential
Information), Clause 18 (Third Party Rights), Clause 19 (Entire Agreement),
Clause 20 (Severability) and Clause 21 (Jurisdiction and Governing Law) and any
other terms of this Heads of Terms which is either capable of having effect or
expressly continue have effect after termination will continue to be effective
notwithstanding any expiry or termination until such time as stated in each
respective case.

 

Article 14:
AMENDMENT ONLY IN WRITING

 

Amendments
to this Heads of Terms may be proposed by any one of the Parties by giving
notice in writing to the other Party and shall only be brought in force by
written agreement of the Parties. The Parties further agree that any proposed
amendment shall not suspend the operations of this Agreement until it is
implemented or otherwise.

 

Article 15.
CONFIDENTIAL INFORMATION

 

15.1.
Unless otherwise specified in this Agreement, all confidential information
provided shall be clearly indicated as confidential information, either orally
or in writing by the party providing the information, at the time of disclosure
to the other Party.

 

15.2
It is understood and agreed by the parties that the SGW System, Gaming
Terminals and related software and its corresponding manuals and documentation
is confidential information and proprietary to SGW.  It is understood and agreed by the Parties
that this Heads of Terms, its terms and its conditions are all deemed to be
confidential information under this Clause. EGT and SGW shall in all respects
honor and maintain the confidentiality of such confidential or proprietary
information as may be disclosed by one party or the other.

 

15.3
Therefore each Party shall hold the confidential information of the other in
strictest confidence and, except as previously authorized in writing by the
other party, and (i) shall use the confidential information only in
furtherance and for the performance of this Agreement, (ii) shall only
copy confidential information to the minimum extent necessary to perform the
necessary tasks relating to the confidential information, and (iii) shall
not disclose the confidential information to any person or entity except to any
government agency and/or employee who has regulatory authority over EGT or SGW,
and in respect of each, their parent , subsidiary or related companies,
including gaming regulatory agencies, and those employees, auditors, Affiliates
or counsel of the Party to whom the information has been disclosed who have a
need to know the confidential information for purposes of such Party’s
compliance with its obligations under this Agreement.

 

15.4
EGT agrees that any of SGW’s Confidential Information may only be supplied to
contractual partners who are also similarly bound by confidentiality provisions
to protect the information of SGW which are at a minimum commensurate with the
requirements as set out on this Clause 15.

 

15.5
Each Party agrees to return any and all confidential information furnished by
the other party promptly at the request of the disclosing party in whatever
form the receiving party maintains it. 
Upon the termination of this Agreement, the receiving party shall not
use any of such confidential information or any material derived from such
confidential information for any purpose.

 

15.6
The Parties each agree that the confidential information they disclose under this
Agreement may be provided to any governmental agency duly authorized and the
obligations of confidentiality under this Clause 15 do not apply to information
that is (i) in the public domain; (ii) known by a party prior to
disclosure by the other party; or (iii) independently developed by a
party without relying on the confidential information of the other party.”

 

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Article 16.
FORCE MAJEURE

 

Non-performance of any of the obligations of SGW  or EGT (other than payment obligations) hereunder due to
delays from any cause beyond their respective control which could not by
reasonable diligence have been avoided, including the act of governmental
authority, force majeure, act of God, accident such as fire, failure of
communication lines or any common carrier services (telecommunications, power),
shortage of fuel or other material shortage, shall be excusable delay and shall
not be a breach of this Agreement. Neither EGT nor
SGW  shall be liable to the other for any
additional cost as a result of any such delay.

 

Article 17.
ASSIGNMENT

 

SGW shall be entitled to assign the Agreement to
a parent company, sister company, or subsidiary which holds all required licences
and has the capacity to fulfil the requirements set forth in this
Agreement.  EGT shall likewise be
entitled to assign this contract to an entity holding all necessary licenses,
and which additionally is notified to SGW and achieves a successful background
due diligence check in accordance with SGW Compliance Committee procedures and
policies. All other assignments of this Agreement by either Party are not
allowed unless otherwise expressly agreed by the other Party in writing.

 

Article 18. THIRD PARTY
RIGHTS

 

No term of this Heads of Terms (including the
software license granted pursuant to Clause 7) is intended to confer a benefit
on, or to be enforceable by, any person who is not a party to this Agreement.

 

Article 19. ENTIRE
AGREEMENT

 

This Heads of Terms (including the license
granted under this Heads of Terms) and the Schedules thereto contain and
constitute the whole agreement between the parties relating to the subject
matter hereof and supersedes all prior agreements understanding and arrangements
between the parties relating to that subject matter.

 

Article 20.  SEVERABILITY

 

If any provision of this agreement is judged to
be illegal or unenforceable, the continuation in full force and effect of the
remainder of the provisions shall not be prejudiced.

 

Article 21:
JURISDICTION AND GOVERNING LAW

 

Any
dispute between the parties arising out of or in connection with this
Agreement, including the validity, invalidity, breach or termination thereof,
which could not be settled amicably, shall be finally settled under and in
accordance with the laws of the England and the Parties hereby submit to the
non- exclusive jurisdiction of the courts of England and Wales.

 

Article 22.
COMPLIANCE AND SPECIAL TERMINATION

 

Both
Parties acknowledge that the other Party operates under privileged licences in
a highly regulated industry, and maintains a compliance program to protect and
preserve its name, reputation, integrity and goodwill through a thorough review
and determination of the integrity and fitness, both initially and thereafter,
of any person or company with which is associates.  This Heads of Terms and the association of
the Parties thereto is contingent on the continued approval under the
compliance program of the Parties.  Each
Party shall cooperate with the other Party as reasonably requested and provide
such information as it may reasonably request on appropriate notice, on its
behalf or on behalf of any relevant regulatory body.  If either Party is required to withdraw its
approval of this Heads of Terms then that Party may terminate this Agreement
immediately and neither Party shall have any additional rights hereunder except
as may be otherwise contained in each of the Agreements.  In addition, either Party may terminate this
Agreement in the event that that Party discovers facts with respect to the
other Party that may jeopardise the gaming licences, permits or status of that
Party or any of its subsidiaries or Affiliates with any gaming commission,
board or similar regulatory or law enforcement authority.  Performance of this Agreement is contingent
upon obtaining any and all necessary initial and continuing approvals required
by any regulatory agency with jurisdiction over the subject matter of this
Agreement.

 

Article 23:
ADVERTISING APPROVALS

 

23.1.                        SGW shall provide artwork in the form of
promotional kits for advertising to EGT and its appointed sub-licensees free of
charge; however such artwork may only be used for the intended purpose of

 

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advertising the associated Games Compendium from which the artwork is
derived, and MUST be approved in writing by SGW in its sole
discretion before release to the public or to any third parties.

 

23.2.                        Artwork as
supplied by SGW, other than being proportionally resized or dimensionally
skewed must NOT be modified in any other way, UNLESS with express written
consent. Specifically, unless otherwise agreed:

 

(i)            alteration,
distortion, cropping, or enhancement is not authorised;

(ii)           overlaying or
confusion with nearby text or graphics when used in larger compositions is not
authorised;

(iii)          Artwork must be used
in whole form as supplied with no masking or fading;

(iv)          Artwork must not be
used in any manner contrary to the context of the original Game, and
specifically shall not be represented next to any defamatory or libellous
content;.

(v)           All compilations
using Game artwork must include “Under license from Reel
Time Gaming” or alternatively “Under license from IPC”
if so instructed by SGW.

 

Article 23: PUBLIC ANNOUNCEMENTS

 

No Party shall issue or make any public
announcement to the media or in any other public forum or disclose any
information regarding this Agreement unless prior written consent has been
obtained from the other Party (such consent not to be unreasonably withheld or
delayed).

 

The Heads of Terms are acknowledged, accepted
and agreed.

 

Scientific
Games Worldwide Limited

 

	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
  Name:

  	
   

  
	
  Title:
  Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  The
  above Heads of Terms are hereby acknowledged, accepted, and agreed.

  	
   

  
	
   

  	
   

  
	
  Elixir
  Gaming Technologies (Hong Kong) Limited

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
				

 

	
   

  	
   

  
	
  Name:

  	
  Clarence
  Chung

  
	
  Title:

  	
    Chief
  Executive Officer

  

 

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Schedule
1

Specification
of Gaming Terminal

 

The
Global Draw “APEX” Cabinet

 

General Configuration

 

	
   

  	
  ·

  	
  steel cabinet with chrome plating

  
	
   

  	
   

  	
   

  
	
   

  	
  ·

  	
  double
  signal candlelight (lightning column)

  
	
   

  	
   

  	
   

  
	
   

  	
  ·

  	
  touchscreen on the lower monitor
  - 3m serial EXII

  
	
   

  	
   

  	
   

  
	
   

  	
  EXII

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ·

  	
  two
  19” TFT LCD monitors

  
	
   

  	
   

  	
   

  
	
   

  	
  ·

  	
  cpu
  secure locking system

  
	
   

  	
   

  	
   

  
	
   

  	
  ·

  	
  wireloom made for our standard

  
	
   

  	
   

  	
   

  
	
   

  	
  ·

  	
  electronic
  keysystem

  

 

 

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The
SilverBall Gaming Terminals:

 

 

Weight: 87 kg

Packaging: B – 550mm, T –
730mm, H – 1290mm

Packaging
with pallet: B – 800mm, T – 800mm, H – 1390mm

 

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Schedule 2

 

WARRANTIES AND INDEMNITIES

 

EGT
represents and warrants the following:

 

Liabilities

 

1.1.EGT
shall pay and be responsible for all and any tax, duties, charges, fines,
penalties and interest that relate or attributable to its business (“Liabilities”) and indemnify and keep indemnified SGW against
the Liabilities, or any other liability incurred by SGW which liability arose
out of the failure by EGT to pay such.

 

1.2.
EGT agrees and warrants that it shall at all times keep the Gaming Terminals
and related equipment free and clear of any and all mortgages, pledges,
security interests, charges, encumbrances, claims and liens of anyone other
than SGW, and shall not transfer, assign, lend, license or otherwise dispose of
any Gaming Terminals and equipment without SGW’s prior under written consent.
EGT shall indemnify on demand and keep indemnified SGW against all and any
breaches of this covenant.

 

Warranties
of Compliance with applicable laws

 

1.2
EGT binds and warrants to SGW, and SGW bind and warrants to EGT that as the
Effective Date and at all times during the term of these Heads of Terms:

 

1.2.1.
All information supplied and all information that will be supplied by it to the
other party  is or will be complete, truthful,
legal and accurate;

 

1.2.2.
It will comply with the applicable laws of the Cambodia including, but not
limited to, applicable anti-corruption, competition, anti-money laundering,
licensing, and registration laws;

 

1.2.3.
EGT undertakes and warrants that in order to comply with the applicable gaming
regulations, it shall also not accept the placement of Internet, telephone or
other remote wagers or bets on the Gaming Terminals;

 

1.2.4.
It has not made or authorized and will not, directly or indirectly, make or
authorize any payments or gifts, or offers or promises of payments or gifts or
things of value, directly or indirectly, to any official or employee of any
national, state, or local government or any agency or instrumentality thereof,
for the purpose of business or improper gain;

 

1.2.5.
It will keep accurate books and records in respect of any dealings with the
other Party whether pursuant to this Heads of Terms or otherwise;

 

1.2.6.
It has not paid, or offered, or agreed to pay any political contributions in
respect of the subject matter of this Heads of Terms and will not do so in the
future;

 

1.2
7. Neither it nor any of its shareholders, employees, officers, or directors is
an official or employee of a Cambodian, Philippine, U.S. or other national,
state, or local Government or any agency or instrumentality thereof, an
official of a political party, or a candidate for political office.

 

1.2.8.
It has not been convicted of or pleaded guilty to a criminal offence, including
fraud or corruption, and that it is not, to the best of its knowledge, subject
of any Government investigation for such offences, and that it is not listed by
any Government Agency as debarred, suspended, proposed for suspension or
debarment, or otherwise ineligible for government programs.

 

17

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