PGIC » Topics » Termination

This excerpt taken from the PGIC 8-K filed Aug 19, 2008.

Termination

10.1 Term. Subject to the provision of Section 10.3, and unless earlier terminated pursuant to Section 10.2, the term of this Agreement will begin on the effective date and conclude after a period of […***…]. The Agreement will automatically be extended for successive […***…] periods unless either party gives written notice of non-renewal at least 30 days before the expiration of the then current term.

10.2 Termination for Regulatory Compliance. Each Party and its affiliates conduct business in a highly regulated industry under privileged licenses issued by gaming regulatory authorities both domestic and international. Each Party maintains a compliance program that has been established to protect and preserve the name, reputation, integrity, and good will of such Party and its affiliates and to monitor compliance with the requirements established by gaming regulatory authorities in various jurisdictions around the world. Each Party agrees to cooperate with requests, inquiries, or investigations of gaming regulatory authorities or law enforcement agencies in connection with the performance of this Agreement. Each Party agrees to fully cooperate with the other Party in the completion of any necessary due diligence background investigation. If either Party receives a written or oral opinion, recommendation or indication from a gaming regulatory authority (including a representative thereof) or if either Party determines, based upon facts and evidence that would reasonably be accepted by gaming regulatory authorities or other licensed gaming entities, that continuation of this Agreement would jeopardize the gaming licenses, permits or status of such Party or any of its affiliates with any gaming regulatory authority or similar law enforcement authority (“Regulatory Trigger”), then: (a) such Party will give notice to the other Party of the Regulatory Trigger, including details of the opinion, recommendation, indication or asserted facts (to the extent known by the receiving Party), and provided such Party is given a time period to address the basis for said Regulatory Trigger, that Party will provide the other Party a reasonable time frame within such Party’s reasonably allotted time period to comment upon and take action to remove such basis; and (b) if such Regulatory Trigger is not cured to that Party’s reasonable satisfaction, such that a reasonable risk remains that jeopardizes the status of such Party with any gaming regulatory authority, that Party may terminate such portion of this Agreement which would cure the Regulatory Trigger (leaving the remainder of this Agreement in force and effect), and if such cannot be effected, such Party may terminate this entire Agreement immediately. In no event will IGT’s rights in the Assigned Intellectual Property or the license granted in Section 3.1, or PGIC’s perpetual, irrevocable license granted in Section 4.1 for the operation of the CEE be affected by any termination under this Article 10.

10.3 Consequences of Termination. In the event that this Agreement or any portion hereof is terminated pursuant to Section 10.1, or the revocable license to PGIC is terminated in accordance with Section 6.8, IGT will retain ownership of the Assigned Intellectual Property. Any payments made or payment obligations that exist pursuant to this Agreement at the time of such termination shall be non-refundable or remain due and payable (as the case may be); provided that such Regulatory Trigger does not mandate otherwise. In addition, the rights intended to be unaffected according to the express provisions of this Agreement and Articles, 7, 8, 9 and 10 will survive any such termination. All other provisions of this Agreement will be terminated.

10.4 Dispute Resolution. Prior to any termination of this Agreement for breach, or the commencement of any litigation by one Party (the first Party) against the other arising out of an alleged breach of this Agreement, the matter must first be referred to a senior executive of each

 

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Party by the first Party sending to the other Party a written notice that sets out the particulars of the dispute and the alleged breach of this Agreement. The senior executives of each Party will then arrange to meet at the next most convenient time, but no later than 30 days from receipt of the dispute notice, and will use commercially reasonable efforts to resolve the dispute in good faith. Should the senior executives fail to resolve the dispute within seven days of the date of their meeting, then either Party may initiate non-binding mediation to resolve such dispute, with costs to be shared equally by the Parties. If such mediation fails to resolve such dispute within 30 days of the mediation, or if mediation is foregone at either Party’s option, each Party is free to seek any remedies available to it to resolve such dispute, including litigation.

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