SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE
EXHIBIT 4(a)(7)
SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE
This Settlement Agreement and Mutual General Release ("Agreement") is made and entered into as of the latest date of execution by a Party (the "Effective Date"), and is by and between: Shuffle Master, Inc., a Minnesota corporation ("SMI"); Shuffle Master Australia Pty Ltd, an Australian corporation organized under the laws of the state of Queensland ("SMA"); Xxxxxx (Trading) Pty Ltd, previously known as Gaming Products (Trading) Pty Ltd, an Australian corporation organized under laws of the state of Queensland ("GPT"); Xxxxxx (Manufacturing) Pty Ltd previously known as Gaming Products (Manufacturing) Pty Ltd, an Australian corporation organized under the laws of the state of Queensland ("GPM"); Xxxxxx (Investments) Pty Ltd, previously known as Gaming Products (Investments) Pty Ltd, an Australian corporation organized under the laws of the state of Queensland ("GPI"); Gaming Products Pty Ltd, an Australian corporation organized under the laws of the state of Queensland ("GPP") (collectively, SMI, SMA, GPT, GPM, GPI and GPP are referred to herein as the "Quick Draw Parties"); and International Thunderbird Gaming Corporation, a Canadian corporation ("ITGC"). Each of SMI, SMA, GPT, GPM, GPI, GPP and ITGC are collectively referred to as the "Parties", and each individually is referred to as a "Party". GPT, GPM, GPI and GPP are collectively referred to as the "GP Entities". This Agreement is intended by the Parties to settle and extinguish all obligations, disputes and differences, existing or potential, as hereinafter set forth.
RECITALS
WHEREAS, in 1999, 2000 and 2001, ITGC, on the one hand, and the GP Entities, on the other hand, entered into a series of agreements including without limitation that certain letter agreement between the GP Entities and ITGC, dated May 17, 2000, as amended by that certain letter agreement dated July 20, 2000 (collectively the "Letter Agreements"). The end result of the Letter Agreements was that ITGC believed that the GP Entities owed it future royalties based on future distribution of certain of the GP Entities' products.
WHEREAS, in April 2001, SMA acquired the stock of GPP and all of the assets of the other GP Entities and also assumed certain liabilities of the other GP Entities, all pursuant to an Acquisition Agreement (the "Acquisition Agreement") between, among others, SMA and the GP Entities.
WHEREAS, SMI is not an obligor under or pursuant to the Acquisition Agreement and acquired no assets and assumed no liabilities of any of the GP Entities nor acquired any stock of GPP.
WHEREAS, IGTC believes that SMI owes it certain sums in connection with the Letter Agreements and in connection therewith, has filed a lawsuit (the "Litigation") against SMI and certain other unnamed entities, in the Superior Court for the County of San Diego, State of California, case number GIC 782954, in which ITGC asserted claims against SMI in the amount of $389,000.00 U.S. As of the date hereof, SMI has not been served in the Litigation.
WHEREAS, SMI and SMA each expressly deny any liability of any kind whatsoever to ITGC, including without limitation as alleged in the Litigation.
WHEREAS, the Quick Draw Parties, on the one hand, and ITGC, on the other hand now desire to cause the Letter Agreements to be terminated, to end the Litigation, and to settle and extinguish all of their differences, disputes and claims, existing or potential, as between them.
NOW, THEREFORE, in consideration for the payment to ITGC, the covenants and agreements contained herein, and other good and valuable consideration, the receipt of which is acknowledged, the Parties agree as follows:
AGREEMENT
- Incorporation of Recitals and Definitions. The above recitals and
definitions are incorporated herein by reference.
- Further Assurances. Each Party agrees to cooperate fully and
execute any and all supplementary documents and take all additional actions
that any other Party may deem reasonably necessary or appropriate to give full
force or effect to the terms and intent of this Agreement.
- Termination of Letter Agreements.
- The Letter Agreements are
hereby terminated in their entirety and any and all of the Parties' rights,
responsibilities, and obligations pursuant to the Letter Agreements are
hereby extinguished. Specifically without limitation, ITGC shall have no
rights of any kind whatsoever under the Letter Agreements against any Quick
Draw Party, and no Quick Draw Party shall owe any amounts, whether now or in
the future, to ITGC, in any way whatsoever relating to or pursuant to the
Letter Agreements.
- ITGC expressly represents,
warrants and agrees that the Letter Agreements constitute the only basis on
which ITGC has any claims against any of the Quick Draw Parties, or the
Quick Draw Party Releasees (as hereafter defined).
- The Letter Agreements are
hereby terminated in their entirety and any and all of the Parties' rights,
responsibilities, and obligations pursuant to the Letter Agreements are
hereby extinguished. Specifically without limitation, ITGC shall have no
rights of any kind whatsoever under the Letter Agreements against any Quick
Draw Party, and no Quick Draw Party shall owe any amounts, whether now or in
the future, to ITGC, in any way whatsoever relating to or pursuant to the
Letter Agreements.
- Dismissal of Litigation. Concurrently upon the execution of this
Agreement, ITGC, as its sole cost, shall cause the Litigation to be dismissed
with prejudice.
- Payment. Concurrently upon the execution of this Agreement, GPT
shall cause ITGC to be paid the sum of $150,000.00 U.S. Of this amount, GPT
authorizes SMA to pay, on GPT's behalf and out of funds belonging solely to
the GP Entities and which are in the possession of SMA, the sum of $130,000.00
U.S. The remaining balance of $20,000.00 U.S. shall be paid by SMA on GPT's
behalf. By execution of this Agreement, ITGC expressly acknowledges that SMI
is not paying any amounts to ITGC or otherwise under this Agreement.
"Execution" for purposes of this paragraph means that each Party has signed
the Agreement in counterpart and transmitted the signature pages to Xxxx
Xxxxxxxxx, attorney for the GP Entities, and Xxxxx Xxxxx, attorney for SMI, no
later than May 15, 2002. Once such signatures are received, then payment shall
be made to ITGC via wire transfer to:
Bank Name: Xxxxxxx Springs Bank
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xx Xxxx, XX 00000
Phone: 000-000-0000
Account Name: Xxxxxx Xxxxxxx, Attorney
Attorney/Client Trust Account
Account Number: 0000000
ABA Routing Number: 000000000
If such wire transfer is not made within three (3) business days after Freestone and Xxxxx each receives the aforementioned signature pages, then this Agreement will be null and void.
- Representations and Warranties of ITGC. ITGC represents and
warrants to each Quick Draw Party that, as of the Effective Date:
- ITGC has not assigned or
otherwise transferred (voluntarily or involuntarily) in any manner any claim
of any kind relating to the subject matter of this Agreement. In the event
that any claim, action, demand or suit should be made or instituted against
any Quick Draw Party because of any such purported assignment, subrogation,
transfer, sale, offer for sale, and/or distribution, ITGC shall indemnify,
defend and hold harmless each Quick Draw Party against such claim, action,
suit or demand, including necessary expenses of investigation, attorney's
fees and costs;
- the execution, delivery and
performance by ITGC of its obligations under this Agreement (i) are within
its corporate power; (ii) have been duly authorized by all necessary
corporate action, (iii) do not contravene any law or any contractual
provision binding on it and (iv) do not require any consent or approval of
any person or governmental authority except such consents and approvals as
have been obtained and are in full force and effect; and
- this Agreement constitutes the legal, valid and binding obligation of ITGC and is enforceable in accordance with its terms.
- ITGC has not assigned or
otherwise transferred (voluntarily or involuntarily) in any manner any claim
of any kind relating to the subject matter of this Agreement. In the event
that any claim, action, demand or suit should be made or instituted against
any Quick Draw Party because of any such purported assignment, subrogation,
transfer, sale, offer for sale, and/or distribution, ITGC shall indemnify,
defend and hold harmless each Quick Draw Party against such claim, action,
suit or demand, including necessary expenses of investigation, attorney's
fees and costs;
- Representations and Warranties of each Quick Draw Party. Each
Quick Draw Party represents and warrants to ITGC that, as of the Effective
Date:
- the execution, delivery and
performance by each Quick Draw Party of its obligations under this Agreement
(i) are within its corporate power, (ii) have been duly authorized by all
necessary corporate action, (iii) do not contravene any law or any
contractual provision binding on it and (iv) do not require any consent or
approval of any person or governmental authority except such consents and
approvals as have been obtained and are in full force and effect; and
- this Agreement constitutes
the legal, valid and binding obligation of each Quick Draw Party and is
enforceable in accordance with its terms.
- the execution, delivery and
performance by each Quick Draw Party of its obligations under this Agreement
(i) are within its corporate power, (ii) have been duly authorized by all
necessary corporate action, (iii) do not contravene any law or any
contractual provision binding on it and (iv) do not require any consent or
approval of any person or governmental authority except such consents and
approvals as have been obtained and are in full force and effect; and
- Additional Representations and Warranties. Each Party hereto
represents and warrants to the other:
- Each of the Parties has made
an investigation of the facts and the law pertaining to the matters
described in this Agreement, as such Party deems necessary, and none of the
Parties hereto has relied or does rely on any promise or representation made
by any other Party with respect to any such matters, except such promises
and representations which are set forth in this Agreement.
- This Agreement in all
respects has been voluntarily and knowingly executed by each of the Parties
based on the advice and with the approval of their respective legal counsel.
- The Parties each acknowledge
that they have read this Agreement, that they are relying solely upon the
contents of this Agreement, and are not relying upon any other oral or
written representations, warranties, or inducements whatsoever as an
inducement to enter into this Agreement, other than those referenced herein,
and acknowledge that no oral or written, express or implied representations,
warranties, or covenants have been made, which are not referenced in this
Agreement.
- The Parties agree that they
have been represented by counsel and have cooperated on the drafting and
preparation of this Agreement. In any construction to be made of this
Agreement, the same shall not be construed for or against any particular
Party, but rather the Agreement is to be construed to implement the intent
of the Parties.
- The individuals executing
this Agreement for each Party, respectively, are duly authorized
representatives and each such individual has the requisite authority to
enter into this Agreement on behalf of his or her principal and all persons
who sign this Agreement on behalf of a corporation represent and warrant
that they have actual authority to sign this Agreement on the corporation's
behalf.
- Each of the Parties has made
an investigation of the facts and the law pertaining to the matters
described in this Agreement, as such Party deems necessary, and none of the
Parties hereto has relied or does rely on any promise or representation made
by any other Party with respect to any such matters, except such promises
and representations which are set forth in this Agreement.
- Release of each Quick Draw Party by ITGC.
- The Payment and releases
described herein are in settlement of all of ITGC's claims against each and
every Quick Draw Party, including, without limitation, any and all claims:
i) related to the Letter Agreements; ii) that are or could have been
asserted in the Litigation; or iii) of any other kind, known or unknown.
- Except for any obligations
arising under this Agreement, and the representations, warranties and
agreements of the Quick Draw Parties contained in this Agreement, ITGC, for
itself and on behalf of its respective past and present employees, agents,
shareholders, partners, officers, directors, subsidiaries, predecessors,
affiliates, insiders, joint venturers, administrators, trustees,
representatives, agents, successors and assigns, members, vendors,
suppliers, customers (direct and indirect) and insurers, and any affiliates
of each of the foregoing (collectively, the "ITGC Releasors"), discharges
and releases each and every Quick Draw Party, and any and all of its and
their past and present employees, agents, shareholders, partners, officers,
directors, subsidiaries, predecessors, affiliates, insiders, joint
venturers, administrators, trustees, representatives, agents, successors and
assigns, members, vendors, suppliers, customers (direct and indirect) and
insurers, and any affiliates of each of the foregoing (collectively, each of
the foregoing, along with each Quick Draw Party, the "Quick Draw Party
Releasees") of and from any and all rights, claims, damages, losses debts,
actions, causes of action, suits, accounts, covenants, contracts, promises,
agreements, subrogations, duties, demands, controversies or liabilities
whatsoever of every name and nature, at law or in equity, known or unknown,
matured or unmatured, foreseeable or unforeseeable, which the ITGC Releasors
now have, ever had, or may have had prior to signing this Agreement against
the Quick Draw Party Releasees by reason of any liability, act, omission,
matter, thing or circumstance whatsoever, including without limitation
relating to the Letter Agreements or the Litigation. ITGC, on behalf of each
of the ITGC Releasors, acknowledges that there is a risk that subsequent to
the execution of this Agreement, the ITGC Releasors will discover or suffer
damage, loss or injury to persons or property which is in some way caused by
or connected with the one or more of the Quick Draw Party Releasees, but
which is unknown or unanticipated at the time of the execution of this
Agreement. ITGC, on behalf of each of the ITGC Releasors, does hereby
specifically assume such risk and agrees that this Agreement and the release
contained herein shall and does apply to all unknown or unanticipated
results of any and all matters, as well as those currently known or
anticipated. Accordingly, ITGC acknowledges that it (through its
representatives) has read the provisions of California Civil Code Section
1542, which provides as follows: "A GENERAL RELEASE DOES NOT EXTEND TO
CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT
THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE
MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR." ITGC, on behalf of the
ITGC Releasors, knowingly and expressly waives, relinquishes and forfeits
all rights and benefits accorded by the provisions of California Civil Code
Section 1542, or any similar federal or state statutes, and furthermore
waives any rights that it might have to invoke said provisions now or in the
future with respect to the release contained in this Paragraph.
- ITGC, on behalf of the ITGC Releasors, hereby represents and warrants to
each Quick Draw Party that it shall never assert any claims or file any
litigation relating to the matters on which it has released the Quick Draw
Party Releasees under this Agreement. Each ITGC Releasor, jointly and
severally, hereby indemnifies and holds harmless each Quick Draw Party
Releasee from any breach of any of the representations, warranties or
agreements contained or made in this Agreement.
- The Payment and releases
described herein are in settlement of all of ITGC's claims against each and
every Quick Draw Party, including, without limitation, any and all claims:
i) related to the Letter Agreements; ii) that are or could have been
asserted in the Litigation; or iii) of any other kind, known or unknown.
- Release of ITGC by the Quick Draw Parties.\
- The releases described herein
are in settlement of all of the Quick Draw Parties claims against ITGC.
- Except for any obligations
arising under this Agreement, and the representations, warranties and
agreements of ITGC contained in this Agreement, each Quick Draw Party, for
itself and on behalf of its respective past and present employees, agents,
shareholders, partners, officers, directors, subsidiaries, predecessors,
affiliates, insiders, joint venturers, administrators, trustees,
representatives, agents, successors and assigns, members, vendors,
suppliers, customers (direct and indirect) and insurers, and any affiliates
of each of the foregoing (collectively, the "Quick Draw Party Releasors"),
discharges and releases ITGC and each, any and all of their past and present
employees, agents, shareholders, partners, officers, directors,
subsidiaries, predecessors, affiliates, insiders, joint venturers,
administrators, trustees, representatives, agents, successors and assigns,
members, vendors, suppliers, customers (direct and indirect) and insurers,
and any affiliates of each of the foregoing (collectively, each of the
foregoing, along with ITGC, the "ITGC Releasees") of and from any and all
rights, claims, damages, losses, debts, actions, causes of action, suits,
accounts, covenants, contracts, promises, agreements, subrogations, duties,
demands, controversies or liabilities whatsoever of every name and nature,
at law or in equity, known or unknown, matured or unmatured, foreseeable or
unforeseeable, which the Quick Draw Party Releasors now have, ever had, or
may have had prior to signing this Agreement against the ITGC Releasees by
reason of any liability, act, omission, matter, thing or circumstance
whatsoever.
- Each Quick Draw Party, on
behalf of the Quick Draw Party Releasors, acknowledges that there is a risk
that subsequent to the execution of this Agreement, the Quick Draw Party
Releasors will discover or suffer damage, loss or injury to persons or
property which is in some way caused by or connected with the ITGC
Releasees, but which is unknown or unanticipated at the time of the
execution of this Agreement. Each Quick Draw Party, on behalf of the Quick
Draw Party Releasors, does hereby specifically assume such risk and agrees
that this Agreement and the release contained herein shall and does apply to
all unknown or unanticipated results of any and all matters, as well as
those currently known or anticipated. Accordingly, each Quick Draw Party
acknowledges that it (through its representatives) has read the provisions
of California Civil Code Section 1542, which provides as follows: "A GENERAL
RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR."
Each Quick Draw Party, on behalf of the Quick Draw Party Releasors,
knowingly and expressly waives, relinquishes and forfeits all rights and
benefits accorded by the provisions of California Civil Code Section 1542,
or any similar federal or state statutes, and furthermore waives any rights
that it might have to invoke said provisions now or in the future with
respect to the release contained in this paragraph.
- Each Quick Draw Party, on
behalf of the Quick Draw Party Releasors, hereby represents and warrants to
each ITGC that it shall never assert any claims or file any litigation
relating to the matters on which it has released the ITGC Releasees under
this Agreement. Each Quick Draw Party Releasor, jointly and severally,
hereby indemnifies and holds harmless each ITGC Releasee from any breach of
any of the representations, warranties or agreements contained or made in
this Agreement.
- The releases described herein
are in settlement of all of the Quick Draw Parties claims against ITGC.
- Indemnity. ITGC, hereby indemnifies and holds each of the Quick
Draw Party Releasees harmless from any claims, liabilities, expenses, losses
or damages of any kind whatsoever (including without limitation, any
attorney's fees) arising out of or relating to any breach of any of the
representations, warranties or agreements made herein by ITGC. The GP Entities
hereby indemnifies and holds each of the IGTC Releasees harmless from any
claims, liabilities, expenses, losses or damages of any kind whatsoever
(including without limitation any attorney's fees) arising out of or relating
to any breach of any of the representations, warranties or agreements made
herein by any of the GP Entities.
- No Admission of Liability. Except as expressly set forth in the
second sentence of this paragraph 12, this Agreement is in no way an admission
of liability by any Party nor is this Agreement an admission that any Party
has suffered any damages as a result of the other's actions. Notwithstanding
the foregoing, ITGC hereby represents, warrants, agrees, and admits that,
notwithstanding any claims made in the Litigation, that SMI was and is not in
any way obligated to it, nor did or does SMI owe ITGC any money or sums
whatsoever, and that ITGC shall never make any claims or contentions in
conflict with this paragraph 12.
- Confidentiality of Agreement. The terms of this Agreement are
intended to be strictly confidential. Except as provided below, each Party and
their counsel shall maintain the confidentiality of this Agreement. The
contents of this Agreement, and its terms and conditions, shall not be
disclosed to any third-party without the express written approval of all the
Parties. The Parties and their counsel agree not to make any public statement
regarding the content, terms and conditions of this Agreement, except that
either Party may publicly state that the Litigation has been mutually resolved
with out any liability or payment by SMI. Notwithstanding the foregoing, the
Parties may disclose this Agreement and its contents to the Internal Revenue
Service, the California Franchise Tax Board, the SEC, applicable or relevant
gaming regulators, or as otherwise required by law or statute. The Parties
also may, to the minimum extent necessary, disclose this Agreement to their
attorneys, financial institutions, investors, shareholders, officers,
directors, senior management and accountants so that they may perform their
professional, business or financial obligations and duties. The Parties may
also disclose this Agreement as they deem reasonably necessary to enable them
to comply with their obligations hereunder.
- Agreement Binding on Successors. This Agreement, and all the terms
and provisions hereof, shall be binding on the Parties and their respective
legal representatives, successors and assigns, administrators and trustees,
and shall inure to the benefit of the Parties and their respective legal
representatives, successors and assigns, administrators and trustees.
- Severability. The Parties have attempted to create an agreement
that is lawful and enforceable in all respects. In the event that any
provision of this Agreement is found or deemed to be illegal or otherwise
invalid and unenforceable, whether in whole or in part, such invalidity shall
not affect the other provisions. In the event that any term hereof is found or
deemed to be illegal or otherwise invalid or unenforceable, the Parties shall
attempt to negotiate a valid new provision concerning the same subject matter.
- Entire Agreement. This Agreement constitutes the entire agreement
between the Parties pertaining to the subject matter hereof, and the final,
complete and exclusive expression of the terms and conditions of their
agreement. Any and all prior agreements, representations, negotiations, and
understandings made by the Parties, oral and written, express or implied, are
hereby superseded and merged herein. Any and all amendments to this Agreement
must be in writing and signed by the Parties.
- Preparation Expenses. Each Party shall bear its own costs and
attorneys' fees in connection with preparation, negotiation, and execution of
this Agreement.
- Expenses. Except as may be applicable under paragraphs 9, 10, 11
or 22 hereof, each Party shall bear its own costs and attorneys' fees in
connection with the Litigation and all disputes which are being resolved in
this Agreement.
- Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of California.
- Headings. Headings are solely for the convenience of the Parties
and shall not be deemed to define, construe or limit any of the provisions
hereof.
- Counterparts. This Agreement may be executed by facsimile, in
multiple counterparts, each of which shall be considered an original but all
of which shall constitute one Agreement.
- Attorneys Fees. In the event of any dispute or question of
interpretation regarding this Agreement, or in the event of any dispute or
litigation between any of the Quick Draw Parties, on the one hand, and ITGC,
on the other hand, with respect to the subject matter hereof, the prevailing
party in any litigation, shall, in addition to any other damages to which it
may be awarded, also recover its attorney's fees and court costs.
IN WITNESS WHEREOF, the Parties have executed this Settlement Agreement and Mutual General Release on the date(s) set forth hereinafter.
SHUFFLE MASTER, INC.
("SMI")
/s/ Xxxxx Xxxxx
Date: May 14, 2002
By:_____________________________
Name: Xxxxx Xxxxx
Its: General Counsel
SHUFFLE MASTER AUSTRALIA PTY LTD
("SMA")
/s/ Xxxxx Xxxxx
Date: May 10, 2002
By:_____________________________
Name: Xxxxx Xxxxx
Its: General Counsel
XXXXXX (TRADING) PTY LTD previously known as
GAMING PRODUCTS (TRADING) PTY LTD
("GPT")
/s/ Xxxxxxx Xxxxxxx Xxxxx
Date: May 14, 2002
By:_____________________________
Name: Xxxxxxx Xxxxxxx Xxxxx
Its: Director
[Continued Signature Page to Settlement Agreement and Mutual General Release]
XXXXXX (MANUFACTURING) PTY LTD previously known as
GAMING PRODUCTS (MANUFACTURING) PTY LTD
("GPM")
/s/ Xxxxxxx Xxxxxxx Xxxxx
Date: May 10, 2002
By:_____________________________
Name: Xxxxxxx Xxxxxxx Xxxxx
Its: Director
XXXXXX (INVESTMENTS) PTY LTD, previously known as
GAMING PRODUCTS (INVESTMENTS) PTY LTD
("GPI")
/s/ Xxxxxxx Xxxxxxx Xxxxx
Date: May 10, 2002
By:_____________________________
Name: Xxxxxxx Xxxxxxx Xxxxx
Its: Diredctor
GAMING PRODUCTS PTY LTD
("GPP")
/s/ Xxxxx Xxxxx
Date: May 14, 2002
By:_____________________________
Name: Xxxxx Xxxxx
Its: General Counsel
INTERNATIONAL THUNDERBIRD GAMING CORPORATION
("ITGC")
/s/ Xxxxxx X. Xxxxxxx
Date: May 14, 2002
By:_____________________________
Name: Xxxxxx X. Xxxxxxx
Its: Chief Operating Officer and General Counsel
