Exhibit 10(43)
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is entered into as of June 22,
2001, by and between Xxxxxx'x Operating Company, Inc., ("Company") and Xxxxxxx
Xxxxxx ("Executive").
The Company and the Executive agree as follows:
1. EMPLOYMENT. The Company hereby employs the Executive as Senior
Vice President, Chief Financial Officer and Treasurer or in such other capacity
as the Company reasonably shall designate. The Executive may be an employee of
the Company or one of its subsidiaries.
2. DUTIES. During the term of this Agreement ("Active
Employment"), the Executive shall devote substantially all of his working time,
energies, and skills to the benefit of the Company's business. The Executive
agrees to serve the Company diligently and to the best of his ability, and to
follow the policies and directions of the Company.
3. COMPENSATION. The Executive's compensation and benefits during
his Active Employment shall be as follows:
(a) BASE SALARY. The Company shall pay the Executive a
base salary ("Base Salary") of $400,000 per year, which will be reviewed
annually by the Company during the term of this Agreement in accordance with its
compensation practices regarding senior executives. The Executive's Base Salary
shall be paid biweekly in accordance with the Company's normal payroll schedule.
All payments shall be subject to the Executive's chosen benefit deductions and
the deduction of payroll taxes and similar assessments as required by law.
(b) BONUS. In addition to the Base Salary, the Executive
shall be eligible for an annual bonus in accordance with the Company's bonus
plan.
4. INSURANCE AND BENEFITS. The Executive will be eligible to
participate in each employee benefit plan and receive each executive benefit
that the Company provides for its senior executives, in accordance with the
applicable plan rules.
5. TERM. The term of this Agreement shall be for four (4) years,
beginning June 22, 2001, and ending June 21, 2005.
6. NO CAUSE TERMINATION/NON-RENEWAL OF AGREEMENT. The Company may
terminate the Executive's Active Employment at any time without cause upon
thirty (30) days' prior written notice
("no cause termination"). The Company also, in its sole discretion, may elect
not to renew this Agreement upon its expiration ("non-renewal of Agreement"). In
the event of such no cause termination or non-renewal of Agreement, the
Executive shall remain an employee of the Company during the subsequent salary
continuation period and shall be entitled only to the salary and benefits set
forth below, unless otherwise specified in this Agreement.
Benefit Termination Date
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Base Salary (rate as of Eighteen (18) months (78 weeks) ("Salary
Separation Date) Continuation Period") from last day
worked ("Separation Period") from last
day of Active Employment ("Separation
Date").
PTO and Service Credit Separation Date (accrued PTO will be
paid within thirty days of Separation
Date).
Use of Credit Cards Separation Date.
Bonus-Payment and Eligibility (i) Eligible for prior year bonus if
Separation Date occurs during payment
year but prior to payment; (ii) eligible
for prorated bonus for the then current
year if in job for more than six (6)
months and Separation Date occurs after
June 30; (iii) not eligible for bonus
for year following Separation Date.
Group Health and Life Insurance End of Salary Continuation Period.
Eighteen (18) month COBRA rights period
for health insurance will commence on
Separation Date. (See also Paragraph
10.)
Retaining Existing Stock (i) Options from grants made prior to
Options for Vesting June 22, 2001, that have vested prior to
and Other Rights Separation Date can be exercised through
end of Salary Continuation Period, but
unvested options from such grants will
be forfeited as of Separation Date; (ii)
options from grants made on or after
June 22, 2001, retained for exercise and
vesting through
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end of Salary Continuation Period.
Exercise of vested options after Salary
Continuation Period per plan rules.
Accelerated vesting of all options not
forfeited on Separation Date if Change
of Control occurs during Salary
Continuation Period.
Retaining Existing All regular restricted stock that is
Restricted Stock for unvested as of the Separation Date will
Vesting and Other Rights be forfeited on that date. Forfeited
restricted stock will not vest upon a
Change in Control during Salary
Continuation. See below for TARSAP.
Eligibility for New Separation Date.
Restricted Stock or New
Stock Options
TARSAP II The next potential vesting installment
of TARSAP II for Executive after the
Separation date if the installment is
earned will vest for Executive (all,
part or none) at the CEO's and HRC's
discretion. If a change in control, as
defined in Executive's Severance
Agreement, occurs during salary
continuation, Executive will only be
entitled to the next potential vesting
installment of TARSAP II not otherwise
earned. Invested shares at the end of
salary continuation are forfeited.
Use of Financial End of Salary Continuation Period. The
Counseling per Plan maximum remaining benefit shall be
Provisions annual benefit remaining as of
Separation Date.
Savings and Retirement End of year of Separation Date.
Plan Deductions (Active Employment termination date will be
Participation) termination date under S&RP.
Executive Supplemental End of year of Separation Date. ESSP
Saving Plan (ESSP) payments will be made in
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accordance with the elections made prior
to the Separation Date.
7. DEATH OF EXECUTIVE. Upon the death of the Executive during his
Active Employment, his salary and all rights and benefits hereunder will
terminate, and his estate and beneficiary(ies) will receive the benefits to
which they are entitled under the terms of the Company's benefit plans and
programs by reason of a participant's death during employment, and the
applicable rights and benefits under the Company's stock plans. If the Executive
dies during the Salary Continuation Period, all of the provisions of the
previous sentence apply except that the remaining salary continuation will be
paid in a lump sum to the Executive's estate.
8. TERMINATION BY COMPANY FOR CAUSE. The Company shall have the
right to terminate the Executive's Active Employment for cause. Employment
status and all salary and benefits shall thereupon cease, except COBRA rights
and as otherwise provided in applicable benefit plans. Termination for cause
shall be effective immediately upon notice sent or given to the Executive and
this effective date will be both his Separation Date and date of termination of
employment. For purposes of this Agreement, the term "cause" shall mean and be
strictly limited to: (i) conviction of any crime that materially discredits the
Company or is materially detrimental to the reputation or goodwill of the
Company; (ii) commission of any material act of fraud or dishonesty against the
Company, or commission of an immoral or unethical act that materially reflects
negatively on the Company, or engaging in willful misconduct; provided that the
Executive shall first be provided with written notice of the claim against him
under this provision; (ii) and with an opportunity to contest said claim before
the Board of Directors; or (iii) material breach of the Executive's obligations
under Paragraph 2. of this Agreement, as so determined by the Board of
Directors.
9. VOLUNTARY TERMINATION/NOTICE PERIOD. The Executive may
terminate this Agreement voluntarily at any time and for any or no reason during
its term upon thirty (30) days' prior written notice to the Company, except as
specified in this paragraph. If the Executive is going to work or act in
competition with the Company as described in Paragraph 13. of this Agreement,
the Executive must give the Company six (6) months prior written notice of his
intention to do so. The written notice provided by the Executive shall specify
the last day to be worked by the Executive ("Separation Date"), which Separation
Date under this Paragraph 9. shall also be his termination of employment date
and must be at least thirty (30) days or six (6) months (as appropriate) after
the date the notice is received by the
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Company. Unless otherwise specified herein, or in a writing executed by both
parties, the Executive shall not receive any of the benefits provided in this
Agreement after the Separation Date set forth in his written notice except for
applicable rights and benefits that apply to employees generally upon
termination of employment.
10. CERTAIN HEALTH INSURANCE BENEFITS. If (i) the Executive
reaches the age of 50 and, when added to his number of years of continuous
service with the Company including any period of salary continuation, the sum of
his age and years of service equals or exceeds 65, and at any time after the
occurrence of both such events the Executive's employment is terminated pursuant
to Paragraph 6., above; or (ii) the Executive reaches the age of 55 and has
attained ten (10) years of continuous service with the Company including any
period of salary continuation, and at any time after the occurrence of both such
events the Executive's employment terminates for any reason other than by the
Company for "cause" as described in paragraph 8., above, the Executive and his
then-eligible dependents shall be entitled to participate in the Company's group
health insurance plan, as amended from time to time by the Company, after the
Executive's Separation Date or the end of the Salary Continuation Period, as
applicable, for the remainder of the Executive's life ("Life Coverage Period").
During the Life Coverage Period, the Executive shall pay 20% of the current
premium (revised annually) on an after-tax basis each quarter, and the Company
shall pay 80% of said premium on an after-tax basis, which contribution will be
imputed income to the Executive. As soon after the Separation Date as the
Executive becomes eligible for Medicare coverage, the Company's group health
insurance plan shall become secondary to Medicare.
If the Executive engages in any of the activities described in
Paragraph 13.(a), below, during the Life Coverage Period, the entitlement of the
Executive and his then-eligible dependents to participate in the Company's group
health insurance plan shall terminate automatically, without any further action
or notice by either party, subject to applicable COBRA rights, which shall
commence on the Separation Date. If the Executive engages in any of the
activities described in said Paragraph 13.(a)(i) in a business which does NOT
compete with the Company or any of its subsidiaries during the Life Coverage
Period, the Company's group health insurance plan shall become secondary to any
primary health insurance plan or coverage made available to the Executive by
that business.
The Executive shall also receive the benefits and be bound by
the provisions of this Paragraph 10 if a Change in
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Control, as defined in the Executive's Severance Agreement, occurs following the
effective date of this Agreement.
11. CHANGE IN CONTROL. If a Change in Control, as defined in the
Executive's Severance Agreement, occurs during the Executive's Active
Employment, and if the Severance Agreement is in force when the Change in
Control occurs, then the Severance Agreement supersedes and replaces this
Agreement except as provided in Paragraph 10. If, prior to a Change in Control
(as defined above), the Executive's Active Employment has been terminated for
any reason by either party, or this Agreement is not renewed by the Company,
then the Executive's Severance Agreement terminates automatically.
12. DISABILITY. If the Executive becomes disabled prior to the
termination of his Active Employment or the non-renewal of this Agreement, he
will be entitled to apply at his option for the Company's long-term disability
benefits. If he is accepted for such benefits, then the terms and provisions of
the Company's benefit plans and the programs (including the ESSP and the
Company's Stock Option and Restricted Stock Plans) that are applicable in the
event of such disability of an employee shall apply in lieu of the salary and
benefits under this Agreement, except that (i) the Escrow Agreement (if then in
force) and his indemnification agreement will continue in force (the Escrow
Agreement will be subject to amendment or termination in accordance with its
terms), and (ii) he will be entitled to the lifetime group insurance benefits
described in Paragraph 10. If the Executive is disabled so that he cannot
perform his duties (as determined by the Human Resources Committee (HRC), and if
he does not apply for long-term disability benefits or is not accepted for such
benefits, then the Company may terminate his duties under this Agreement. In
such event, he will receive eighteen (18) months' salary continuation, together
with all other benefits, and during such period of salary continuation any stock
options and restricted stock grants then in existence will continue in force for
vesting purposes. However, during such period of salary continuation for
disability, Executive will not be eligible to participate in the annual bonus
plan, nor will he be eligible to receive stock option or restricted stock grants
or any other long-term incentive awards except to the extent approved by the
HRC.
If the Executive becomes disabled during the Salary
Continuation Period, he will be entitled only to the salary and benefits
described in Paragraphs 6. and 10., above, for the periods set forth in those
respective paragraphs.
13. NON-COMPETITION.
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(a) NON-COMPETITION. During the Executive's Active
Employment, and during the Salary Continuation Period described in Paragraph 6.,
above, the Executive:
(i) shall not engage in any activity, including
development activity, whether as employer, proprietor, partner, stockholder
(other than the holder of less than 5% of the stock of a corporation the
securities of which are traded on a national securities exchange or in the
over-the-counter market), director, officer, employee, consultant or otherwise,
in competition with (x) the casino, casino/hotel and/or casino/resort businesses
conducted at the date hereof by the Company, or any subsidiary or affiliate
("Company" for purposes of this paragraph 13.) or (y) any casino, casino/hotel
and/or casino/resort business in which the Company is substantially engaged at
any time during the Active Employment period;
(ii) shall not solicit, in competition with the
Company, any person who is a customer of the businesses conducted by the Company
at the date hereof or of any business in which the Company is substantially
engaged at any time during the term of this Agreement.
(b) SCOPE OF COVENANTS; REMEDIES. The following
provisions shall apply to the covenants of the Executive contained in this
Paragraph 13:
(i) the covenants contained in paragraphs (i)
and (ii) of Paragraph 13.(a) shall apply within the United States, Canada and
Mexico, plus any territories in which Company is actively engaged in the conduct
of business while the Executive is employed under this Agreement, including,
without limitation, the territories in which customers are then being solicited;
(ii) without limiting the right of the Company to
pursue all other legal and equitable remedies available for violation by the
Executive of the covenants contained in this Paragraph 13., it is expressly
agreed by the Executive and the Company that such other remedies cannot fully
compensate the Company for any such violation and that the Company shall be
entitled to injunctive relief to prevent any such violation or any continuing
violation thereof;
(iii) each party intends and agrees that if, in
any action before any court or agency legally empowered to enforce the covenants
contained in this Paragraph 13., any term, restriction, covenant or promise
contained therein is found to be unreasonable and accordingly unenforceable,
then such term, restriction, covenant or promise shall be deemed modified to the
extent necessary to make it enforceable by such court or agency.
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14. Any confidentiality/non-solicitation agreement that Executive
has signed with the Company shall remain in full force and effect according to
its terms.
15. POST ACTIVE-EMPLOYMENT COOPERATION. Upon the termination of
his Active Employment, the Executive will cooperate with, and provide
information to, the Company in assuring an orderly transition of all matters
being handled by him. Upon the Company providing reasonable notice to him, he
will also appear as a witness at the Company's request and/or assist the Company
in any litigation, bankruptcy or similar matter in which the Company or any
affiliate thereof is a party; PROVIDED that the Company will defray any approved
out-of-pocket expenses incurred by him in connection with any such appearance
and that, if the Executive is no longer receiving salary compensation from the
Company, the Company will compensate him for all time spent, at either his then
current compensation rate or his salary rate as of the Separation Date,
whichever is higher. The Company agrees further to indemnify him as prescribed
in his Indemnification Agreement and Article TENTH of the Certificate of
Incorporation of Xxxxxx'x Entertainment, Inc., as amended, filed on November 2,
1989, in the Office of the Secretary of State of the State of Delaware and
recorded in Book 935, Page 780, ET SEQ.
16. RELEASE. Upon the termination of the Executive's Active
Employment, and in consideration of the receipt of the salary and benefits
described in this Agreement, except for claims arising from the covenants,
agreements, and undertakings of the Company as set forth herein and except as
prohibited by statutory language, the Executive forever and unconditionally
waives, and releases Xxxxxx'x Entertainment, Inc., Xxxxxx'x Operating Company,
Inc., their subsidiaries and affiliates, and their officers, directors, agents,
benefit plan trustees, and employees ("Released Parties") from any and all
claims, whether known or unknown, and regardless of type, cause or nature,
including but not limited to claims arising under all salary, vacation,
insurance, bonus, stock, and all other benefit plans, and all state and federal
anti-discrimination, civil rights and human rights laws, ordinances and
statutes, including Title VII of the Civil Rights Act of 1964 and the Age
Discrimination in Employment Act, concerning his employment with Xxxxxx'x
Operating Company, Inc., its subsidiaries and affiliates, and the cessation of
that employment
17. GENERAL PROVISIONS.
(a) NOTICES. Any notice to be given hereunder by either
party to the other may be effected by personal delivery,
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in writing, or by mail, registered or certified, postage prepaid with return
receipt requested. Mailed notices shall be addressed to the parties at the
addresses set forth below, but each party may change his or its address by
written notice in accordance with this Paragraph 17.(a). Notices shall be deemed
communicated as of the actual receipt or refusal of receipt.
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If to Executive: Xxxxxxx Xxxxxx
000 Xxxxxx Xxxxx
Xxx Xxxxx, Xxxxxx 00000
If to Company: Xxxxxx'x Operating Company, Inc.
Xxx Xxxxxx'x Xxxxx
Xxx Xxxxx, Xxxxxx 00000-0000
Attn: General Counsel
(b) PARTIAL INVALIDITY. If any provision in this
Agreement is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remaining provision shall, nevertheless, continue in full
force and without being impaired or invalidated in any way.
(c) GOVERNING LAW. This Agreement shall be governed by
and construed in accordance with the laws of the State of Nevada, without regard
to its conflict of laws provisions.
(d) NO CONFLICTING AGREEMENT. By signing this Agreement,
Executive warrants that he is not a party to any restrictive covenant, agreement
or contract which limits the performance of his duties and responsibilities
under this Agreement or under which such performance would constitute a breach.
(e) HEADINGS. The Section, paragraph, and subparagraph
headings are for convenience or reference only and shall not define or limit the
provisions hereof.
(f) AMENDMENTS. Any amendments to this Agreement must be
in writing and signed by both parties.
(g) BINDING AGREEMENT. This Agreement is binding on the
parties and their heirs, successors and assigns.
(h) SURVIVAL OF PROVISIONS. The provisions of this
Agreement shall survive any termination thereof if so provided herein and if
necessary or desirable fully to accomplish the purposes of such provisions,
including without limitation the rights and obligations of the Executive under
Paragraphs 6, 13, 15, 16 and 17 hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
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Xxxxxx'x Operating Company, Inc.
/s/ XXXXXXX X. XXXXXX By:/s/ XXXXXX X. XXXXX
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Xxxxxxx Xxxxxx Xxxxxx X. Xxxxx
Executive Chairman of the Board and
Chief Executive Officer
