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EXCLUSIVE DISTRIBUTORSHIP AGREEMENT
This agreement is entered into effective 19th February, 1997 (the "EFFECTIVE
DATE") between, Casinovations, a U.S. Corporation having its registered
address at 0000 Xxxxx Xxxxxxxx Xxxxxxx, Xxxxx 000, Xxx Xxxxx, Xxxxxx 00000
XXX ("MANUFACTURER") and RGB SDN BHD., a Malaysia Corporation having its
registered address at 0 Xxxxx Xxxx, 00000 Xxxxx Xxxxxx, Xxxxxxxx
(DISTRIBUTOR").
WITNESSETH
WHEREAS, MANUFACTURER develops, manufactures, and sells various types of
casino equipment for lawful markets worldwide; and
WHEREAS, DISTRIBUTOR desires to obtain the exclusive distributorship (as
defined hereinafter) of all the Casino Equipment (as defined hereafter) from
MANUFACTURER for sale in certain territory (as defined hereinafter),
NOW THEREFORE, it is agreed between the parties as follows:
1. DISTRIBUTOR APPOINTMENT AND TERRITORY
a. MANUFACTURER hereby appoints DISTRIBUTOR, upon the terms and
conditions of this Agreement as an exclusive distributors of it's Casino Card
Shuffler Equipment Product line. Prices will be set for equipment so
provided will be at a DISTRIBUTOR price discount as specified in clause 5b ,
herein, The exclusive TERRITORY granted to the DISTRIBUTOR is specified in
Schedule "A".
b. DISTRIBUTOR agrees not to buy, sell, or otherwise deal in within the
TERRITORY, any products which may be competitive with the PRODUCTS unless
otherwise authorized by MANUFACTURER in writing.
2. DEVELOPMENT OF TERRITORY, SALES AND SERVICE
a. DISTRIBUTOR hereby accepts such appointment and agrees at its own
expense to devote its best efforts to promote the distribution and sale of
the PRODUCTS in the TERRITORY to its maximum potential.
b. From time to time special promotion measures may be taken by either
party such as magazine advertisement, exhibitions, etc. Expenses of such
joint sales promotion shall be borne between on a fifty-fifty (50/50) basis,
to a maximum amount of US$5,000.00 each per annum, but will require prior
written approval by both parties.
c. MANUFACTURER agrees to provide technical training to DISTRIBUTOR's
staff and/or customers at DISTRIBUTOR's facility without compensation.
DISTRIBUTOR or DISTRIBUTOR's customers shall bear round trip airfare costs
while MANUFACTURER will provide reasonable accommodation and meals for
DISTRIBUTOR'S technician(s) to be dispatched in this regard,
3. WARRANTY
a) The date of warranty of MANUFACTURER'S PRODUCTS shall be the date of
the arrival of the products at any port or airport of the destination.
b) MANUFACTURER warrants the PRODUCTS have no defects in their design
material and workmanship. Immediately after the discovery of any defects in
the PRODUCTS, DISTRIBUTOR shall give MANUFACTURER a written notice to such
effect together with clear evidence thereof. If, in MANUFACTURER's opinion,
the defects are not due to its fault not attributable to MANUFACTURER by any
reason, then it shall promptly notify DISTRIBUTOR of its denial of
responsibility thereof. In such cases, both parties shall use their best
efforts to solve the problem amicably in good faith.
c) The obligation of MANUFACTURER under this warranty shall be limited
to the supply of repair and/or replacement parts for the defective PRODUCTS
in accordance with the provisions set forth hereafter. The warranty period
after delivery of products will be decided by the manufacturer.
4. PARTS
a. Together with the first shipment of the PRODUCTS after the execution
of this Agreement, MANUFACTURER provides DISTRIBUTOR with appropriate
number
of free-of-charge spare parts as Distributor's stock for their supply of the
same to its customers in the TERRITORIES. Terms and conditions of the supply
of said spare parts such as quantity, prices, payment term shall be
negotiated within a reasonable period of time after the effective date of
this Agreement.
b. DISTRIBUTOR shall keep all faulty parts replaced and maintain
updated proper stock records and provide them with MANUFACTURER, if it so
desires, so as to keep adequate stock level of spare parts constantly.
5. PRICE
a. The DISTRIBUTOR shall pay MANUFACTURER in United States Dollars
(USD), for all PRODUCTS ordered and shipped at the prices set as per clause
5b herein.
b. The MANUFACTURER agrees to offer to the DISTRIBUTOR a minimum
discount of 25% less than the promoted retail price in Nevada. The
MANUFACTURER agrees to negotiate in good faith purchase prices for quantity
and accelerated payments.
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6. ORDER AND SHIPMENT
a. All purchase orders for the PRODUCTS placed by DISTRIBUTOR with
MANUFACTURER shall be subject to the provisions of this Agreement. Any
provision of any such order that is inconsistent with this Agreement or that
may seek to impose any additional obligations upon MANUFACTURER shall be null
and void unless approved in writing by both parties. MANUFACTURER will
endeavor, so far as it may be practicable for it to do so, to fill such
orders, but shall be under no liability to DISTRIBUTOR for any omission to do
so, irrespective of the reason, nor shall any partial shipment or shipments
against any order impose any liability upon MANUFACTURER with respect to the
undelivered balance of any such order.
b. All sales made under this Agreement shall be in accordance with and
interpreted MANUFACTURER's under Malaysia law.
c. MANUFACTURER shall not be responsible or liable for any loss, damage
detention, or delay caused by fire, strike, civil or military authority,
governmental restrictions or controls, insurrection or riot, railroad, marine
or air embargoes, lockout, tempest, accident, breakdown of machinery, yield
problems, delay in delivery of materials by other parties, or any cause which
is unavoidable or beyond its reasonable control; nor in any event for
consequential damages.
7. RELATIONSHIP OF THE PARTIES AND WARRANTIES
DISTRIBUTOR is an independent contractor and in no wary an agent of
MANUFACTURER, its being expressly agreed that the only relationship created
by this Agreement is that of Manufacturer and Distributor. DISTRIBUTOR
agrees not to make any representation, promise, guarantee or warranty on
MANUFACTURER's behalf. DISTRIBUTOR further agrees that it has no authority
to assume or create any obligation on MANUFACTURER'S behalf, expressed or
implied, regarding MANUFACTURER's PRODUCTS or otherwise. MANUFACTURER
only warrants the PRODUCTS sold by it to DISTRIBUTOR indicated herein. In no
event shall MANUFACTURER be liable for damages by reason or failure of any
products to function properly or for consequential or special damages.
8. RECORDS AND REPORTS
The DISTRIBUTOR shall maintain a complete record of all PRODUCTS sold by the
DISTRIBUTOR and furnish such data to MANUFACTURER upon its request.
9. CUSTOM PRODUCTS
Custom products, for purpose of agreement, are defined as products which have
specific function unique to a customer. All orders for custom products must
be approved in writing by MANUFACTURER prior to acceptance by DISTRIBUTOR.
Thereafter, DISTRIBUTOR will promptly notify MANUFACTURER of any
circumstances which may affect that order and MANUFACTURER will keep
DISTRIBUTOR informed of its progress in fulfilling such order.
10. TERM AND TERMINATION
a. This Agreement shall be remain in full force and effect for a period
of five (5) years from the EFFECTIVE DATE hereof, or until such earlier date
as of which it may be terminated as hereinafter provided. If for any reason
whatsoever the relations between the parties hereto shall continue beyond the
said term hereof without formal written agreement as to the terms and
conditions thereof, such continue of relations shall not be deemed a renewal
or extension of said term beyond the said expiration date and the same shall
be subject to immediate termination upon notice by either party to the other,
but shall in all other respects be deemed to be subject to terms and
conditions identical with those contained herein.
b. If either party hereto shall fail to perform any of the obligations
imposed upon it hereunder, the other party shall have the right as its
option, to terminate this Agreement immediately by giving notice. In the
event of a termination for cause hereunder, MANUFACTURER reserves the
right to purchase from the DISTRIBUTOR and the DISTRIBUTOR shall sell to
MANUFACTURER any PRODUCTS not sold which the DISTRIBUTOR may have on
hand, at
the time of such termination.
c. Independently of any violation of the provisions of this agreement,
either party hereto may terminate this Agreement at any time and without
cause, by giving the other party at least thirty (30) days notice of its
election to do so. In the event of such termination by MANUFACTURER without
cause, MANUFACTURER at its option may re-purchase DISTRIBUTOR's inventory
of the PRODUCTS at fair market value to be determined at MANUFACTURER's sole
discretion.
d. Upon termination or expiration of this Agreement for any cause
whatsoever, MANUFACTURER will, subject to all the terms hereof, complete its
obligations hereunder as to any orders received from the DISTRIBUTOR and
accepted by MANUFACTURER prior to the termination or expiration of
this Agreement. Thereafter, MANUFACTURER or a new Distributor may complete
any transaction inaugurated by DISTRIBUTOR but not therefore resulting in an
accepted order. Upon such termination or expiration the DISTRIBUTOR shall
immediately discontinue all promotion and advertising with respect to the
PRODUCTS.
e. Neither the expiration nor termination of this Agreement shall
release DISTRIBUTOR from the obligation to pay any sum then may be owing
MANUFACTURER or from the obligation to perform any other duty or to discharge
any other liability that has been incurred prior thereto. Subject to the
provisions of the immediately preceding sentence, however, neither party
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shall by reason of the expiration or termination of this Agreement be liable
to the other for compensation or damage on account of the loss of present or
prospective profits on sales or anticipated sales, or expenditures,
investments or commitments made in connection therewith or in connection with
the establishment, development or maintenance of DISTRIBUTOR's or
MANUFACTURER'S business or goodwill.
f. MANUFACTURER shall be entitled to immediately terminate this
Agreement by notice in writing to DISTRIBUTOR upon:
1. The filing by DISTRIBUTOR of petition in bankruptcy or insolvency,
2. Any adjudication that DISTRIBUTOR of any bankrupt or insolvent;
3. The filing by DISTRIBUTOR of any petition seeking reorganization or
readjustment or arrangement of the business of DISTRIBUTOR under any law
relating to bankruptcy or insolvency;
4. The appointment of a receiver for all or substantially all of the
property of DISTRIBUTOR;
5. The making by DISTRIBUTOR of any assignment or attempted assignment
for the benefit of creditors;
6. The institution of any proceeding for the liquidation or
winding up of DISTRIBUTOR'S business or for the termination of its corporate
charter.
11. EXTRA-TERRITORIAL SALES
Without the prior written consent of MANUFACTURER in each instance,
DISTRIBUTOR shall not, directly or indirectly, offer for resale, sell or ship
PRODUCTS and/or replacement parts outside of the TERRITORY. Inquiries from
customers or potential customers outside the TERRITORY shall be promptly
referred to MANUFACTURER, who will reply in writing if the DISTRIBUTOR may
pursue. Likewise, MANUFACTURER agrees that inquiries received from customers
or potential customers in the TERRITORY shall be referred to DISTRIBUTOR.
12. PRODUCT CHANGES
MANUFACTURER reserves the right, from time to time, without incurring any
obligation to DISTRIBUTOR to discontinue any PRODUCTS or type thereof, to
alter the design or construction thereof, and/or add new and additional types
thereof to its line and in the event of any such action on MANUFACTURER's
part, it shall give DISTRIBUTOR notice thereof as soon as it may be
practicable to do so.
13. MARKET REPRESENTATIONS
DISTRIBUTOR acknowledges and agrees that MANUFACTURER has made no
statements
or representations as to the size of the market for the PRODUCTS or as to the
amount of profits to be received by DISTRIBUTOR acknowledges that in entering
into this Agreement it is relying entirely on its own estimate as to the
market for the PRODUCTS.
14. CONFIDENTIALITY
DISTRIBUTOR agrees to hold all marketing, sales, business and technical
information regarding MANUFACTURER or its customers in strict test confidence
and disclose no such information to any third party during the term of this
Agreement and for three (3) years after its termination or cancellation.
15. NON ASSIGNMENT AND NOTICE OR CERTAIN CHANGES
Without MANUFACTURER's prior written consent, neither this Agreement for any
interest therein shall be transferable or assignable by DISTRIBUTOR, by
operation of law or otherwise. DISTRIBUTOR shall immediately notify
MANUFACTURER in writing of any substantial change in the ownership, financial
interests or active management of DISTRIBUTOR. MANUFACTURER may assign this
agreement to a subsidiary or success or in interests.
16. GOVERNMENTAL PERMITS AND LICENSES
DISTRIBUTOR shall obtain at its own expenses all necessary governmental
permits/licenses for but not limited to the importation, sale, installment,
operation, repair, maintenance and bear the cost such as, but not limited to
import duty and any other related taxes imposed into the TERRITORY of the
PRODUCTS purchased by DISTRIBUTOR.
17. RELEASE FROM CLAIMS
In consideration of the execution of this Agreement by MANUFACTURER
DISTRIBUTOR, DISTRIBUTOR hereby releases MANUFACTURER from all claims,
demands or other liabilities, if any there be as of to the date execution of
this Agreement by DISTRIBUTOR, except indebtedness due under a written
contract with MANUFACTURER or a written warranty issued by MANUFACTURER.
18. USE OF NAME AND TRADE-MARKS
DISTRIBUTOR shall not use in its corporate firm or business name or allow to
be used by others, insofar as it may have any power to prevent such use the
name "CASINOVATIONS" or any other trade name or trade-xxxx adopted by
MANUFACTURER or any words or names or combination of words or names closely
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resembling any of them provided, however, that during the term hereof
DISTRIBUTOR shall have the right to and shall indicate to the public and to
the trade by names of advertising, pamphlets, letterheads or other media for
the purpose of selling the PRODUCTS in and for the TERRITORY that the
DISTRIBUTOR is the authorized distributor of the PRODUCTS. Upon the
expiration or termination of this Agreement, DISTRIBUTOR, forthwith shall
discontinue the use of the name "CASINOVATIONS" and of any other name or
names or any combination of words or design or trade-xxxx or trade names that
would indicate or tend to indicate that DISTRIBUTOR was or is a distributor
of the PRODUCTS.
19. NO LICENSES IMPLIED OR GRANTED
No licenses are granted or implied by this Agreement under any intellectual
property owned or controlled by MANUFACTURER or under which MANUFACTURER
has
any rights except the right to buy, sell and deal in the PRODUCTS furnished
by MANUFACTURER. No rights to manufacture are granted by this Agreement.
DISTRIBUTOR agrees that it will not remove or alter MANUFACTURER's patent
number or other marks affixed to the PRODUCTS or permits the same to be done.
20. WAIVER
The failure of either party at any time to require performance by the other
party of any provisions hereof shall in no way affect the full to require
such performance at any time thereafter. Nor shall the waiver by either
party of a breach of any provisions hereof be a waiver of any succeeding
breach of the same or any other such provisions or be a waiver of the
provision itself.
21. BINDING
The official and binding version of this Agreement shall be English
irrevocable of the language into which it may be translated.
22. NOTICES
Any notice herein required or permitted to be given shall be in writing and
may be personally served or sent by facsimile or mail and shall be deemed to
have received if personally served when served, if mailed on the fifth
business day after deposit in Malaysian mail or US mail, as the case may be,
with airmail postage I prepaid and properly addressed. For purposes hereof
the address I of the parties hereto (until a notice of change thereof is
given as provided in this Section) will be as follows:
MANUFACTURER:
CASINOVATIONS INCORPORATED
0000 Xxxxx Xxxxxxxx Xxxxxxx
Xxxxx 00 0 Xxx Xxxxx
Xxxxxx 00000 U.S.A
Attn.: Xx. Xxxxxx X Xxxx
Phone: 0-000-000-0000
Fax: 0 000 000 0000
DISTRIBUTOR:
RGB SDN BHD
0 Xxxxx Xxxx
00000 Xxxxxx
Xxxxxxxx
Attn.: Xx. Xxxxx Xxx Xxxx
Phone: 60-4-263 1111
Fax: 000 0000000
23. GOVERNING LAW
This Agreement shall be governed and construed in accordance with the laws of
Malaysia/United States excluding any law or principle which would apply the
law of any other jurisdiction. The rights and obligations of the parties
shall not be governed by the provisions of the U.N. Convention on Contracts
for the International Sale of Goods.
24. ARBITRATION
Both parties herein agree to the following method of the arbitration:
a. Any dispute issue difference of opinion arising parties hereto out
of or relating to this Agreement, or the breach thereof, shall be finally
settled by arbitration in Kuala Lumpur in accordance with the Commercial
Arbitration Rules of The Arbitration Association, unless otherwise agreed
between the parties. The award rendered by arbitrator(s) shall be final and
binding upon both parties.
b. If applicable, the parties shall have the right to conduct
discovery, provided that the arbitrator(s) may order that any particular
discovery initiated by a party be taken if the arbitrator(s) determine that
such discovery is reasonably necessary for the presentation of the requesting
party's case.
c. The language of the arbitration shall be English.
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d. In the event of arbitration concerning this Agreement, the
prevailing party in such proceeding shall be entitled to reimbursement from
the other party for all reasonable attorney's fees and costs incurred with
respect to such proceeding.
e. This provision 25 shall survive the expiration or termination of
this Agreement for a period of three(3) years.
25. EXECUTION
This Agreement shall not be effective nor binding upon MANUFACTURER until
signed on its behalf by an authorized officer, nor shall any modification,
renewal, termination or waiver of any of the provisions herein contained. or
any future representation, promise condition or waiver in connection with the
subject matter hereof be binding upon MANUFACTURER unless made in writing and
executed by MANUFACTURER in the same manner.
26. INTEGRATION
This Agreement sets forth the entire agreement and understanding between the
parties as to the subject matter hereof and merges all prior writings and
discussions between them and neither party shall be bound by any terms,
conditions, definitions, warranties or representations other than as
expressly provided herein or as duly forth on or subsequent to the date
hereof in writing signed by the party to be bound thereby.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their authorized representatives.
MANUFACTURER: DISTRIBUTOR:
CASINOVATIONS INC. RGB SDN BHD.
By: Xx. Xxxxxx Xxxx Xx. Xxxxx Xxx Xxxx
Title: Executive Vice President Title: Director
Date: 2/20/97 Date: 2/20/97
EXHIBIT "A" TERRITORY
The entire Asian RIM area including but not limited to Malaysia, Singapore
China, Hong Kong, Korea Vietnam Indonesia Thailand, The Philippines, Nepal,
Cambodia India, Sri Lanka, Macau, Myanmar, Laos, Cruise Ships based in
Malaysia, Singapore & Hong Kong, Islands in the Asian areas.
The Territory specifically excludes Japan, Australia, and New Zealand which
will be treated as common distributor areas.
