EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made effective for all purposes and in all respects
as of the 12th day of October, 2001, by and between CENTURY CASINOS, INC., a
Delaware corporation (hereinafter referred to as the "Employer" or the
"Company"), and XXXXX HAITZMANN (hereinafter referred to as the "Employee").
WITNESSETH THAT:
WHEREAS, Employee is presently employed, and has since 1993 been employed
by the Company; and
WHEREAS, the Employee's performance of his duties as Chairman and Chief
Executive Officer ("CEO") of the Company has been and continues to be critical
to the success of the Company; and
WHEREAS, both the Company and the Employee desire to set forth the terms
and conditions of their agreements and understandings (as agreed verbally and as
consummated and acted on immediately before entering into this Agreement), and
for their mutual benefit to extend the term of Employee's employment hereunder;
NOW, THEREFORE, in consideration of the foregoing, of the mutual promises
herein contained, and of other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties, intending legally to
be bound, agree as follows:
1. Term of Agreement.
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The term of this Agreement shall commence on September 1, 2001, and shall
continue until December 31, 2006, and shall be automatically renewed for
additional, successive periods of five (5) years each thereafter, unless sooner
terminated in accordance with the provisions of Paragraph 5.
2. Duties of Employee.
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2.1 It is understood and agreed that Employee's principal duties on
behalf of the Company at the date of execution hereof are and shall be Chairman
and CEO of the Company. In accepting this Employment Agreement, Employee shall
undertake and assume the responsibility of performing for and on behalf of the
Company such duties as are usual and customary to his position as Chairman and
CEO in the way he has performed in the past on behalf of the Company in that
position.
2.2 Employee covenants and agrees that at all times during the term of
this Agreement, Employee shall devote his best efforts to his duties as Chairman
and CEO of the Company.
3. Compensation.
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3.1 Salary. As compensation for the services rendered by Employee for
the Company pursuant to this Agreement, Employee shall be paid not less than the
following base annual salary, on a monthly basis, during the term hereof:
$24,000, plus annual increases and bonuses, and such other incentives, benefits,
insurance policies and compensation as may have been and may be awarded to him
from time to time by the Compensation Committee of the Board of Directors of the
Company.
3.2 Employees' Equity Incentive Plan. Employee shall be a participant
in the Company's Employees' Equity Incentive Plan, as it may be amended from
time to time by the Board of Directors; provided, that if any change - after the
date of this Agreement - in any tax rules and regulations, or in the application
or applicability of any tax rules as a result of Employee's employment with the
Company, or required accounting principles shall negatively impact the amount of
Employee's total after tax compensation under this Section 3, the Company shall
increase Employee's other compensation and incentives accordingly to completely
offset such negative impact.
3.3 Salary Review. Employee's salary will be reviewed annually by the
Compensation Committee.
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4. Additional Benefits.
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In addition to, and not in limitation of, the compensation referred to in
Section 3, Employee shall be paid the following additional benefits during the
term hereof:
4.1 Reimbursement. The Company shall continue to either provide
Employee with, or shall reimburse Employee for, all Reasonable Expenses incurred
by him in connection with the performance of his duties as an executive for the
Company, in substantially at least the same form and fashion as it has been done
during the past twelve (12) months preceding the date of this Agreement.
4.2 Death or Disability Payments.
(a) In the event of the Employee's disability or death, during the
term of his employment hereunder, Employee's salary in effect at the time of his
death or disability shall continue to be paid to the Employee, or to his
designee or heirs, for a period of twelve (12) calendar months from the date of
death or from the date of Employee's termination of employment by reason of
disability.
(b) For the purposes of this Employment Agreement, the obligations of
the Company to make the payments upon the disability of Employee shall not
become effective unless and until all of the following conditions are met, as
determined (referring to (i) and (ii) below) by the Employee's regular physician
and an independent physician selected by the Employee (or his immediate family):
(i) Employee shall become physically or mentally incapable (excluding
infrequent and temporary absences due to ordinary illnesses) of properly
performing the services required of him in accordance with his obligations under
Section 2 hereof or similar provisions of any renewal agreement;
(ii) Such incapacities shall exist or be reasonably expected to exist
for more than one hundred eighty (180) days in the aggregate during the period
of twelve (12) consecutive months; and
(iii) Either the Employee or the Company shall have given the other
sixty (60) days written notice of his or its intention to terminate the active
employment of Employee because of such disability.
5. Termination.
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5.1 Termination By Either Party Without Cause. At any time during the
term hereof, or at the end of the term or any renewal term under Section 1
above, this Employment Agreement may be terminated "without cause" by either the
Company or the Employee upon sixty (60) days written notice to the other party.
(a) Termination By Employee. In the event of such termination
"without cause" by Employee, the Company shall have the option either (i) to
accept Employee's resignation, effective immediately on receipt of such written
notice; or (ii) to require Employee to continue to perform his duties hereunder,
for a period not to exceed six (6) months from the date of receipt of such
written notice.
In either event, the Employee's compensation and benefits hereunder shall
continue only until the date on which the Employee ceases to perform any further
duties for the Company.
(b) Termination By Company. In the event of such termination
"without cause" by the Company, Employee shall be continued at the same base
salary for a period of six (6) months from the date on which the Employee
receives written notice of termination. Such compensation shall be paid to the
Employee in six (6) equal, successive monthly payments, beginning on the 1st day
of the month immediately following the date on which the Employee receives
written notice of termination.
Employee shall continue to make himself available to, and shall
cooperate with the Company, as may be reasonably required to assist the Company
during the six-month transition period.
(c) In the event Employee's employment hereunder is terminated by
the Company "without cause" pursuant to this Section 5.1(b), during the first
three (3) years after a "Change of Control," as defined in Annexure A,
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has occurred, then the provisions of Section 5.3(b) shall apply.
5.2 Termination By Company For Cause.
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Notwithstanding any other provision hereof, the Company may terminate
Employee's employment under this Agreement at any time for cause. The
termination shall be effected by written notice thereof to the Employee, which
shall specify the exact cause for termination.
Upon such valid termination for cause by the Company, Employee shall
not receive any termination pay or benefits beyond the date on which he receives
final written notice of termination.
5.3 Termination By Employee For Cause.
-------------------------------------
(a) Notwithstanding any other provision hereof, Employee may
terminate his employment with Company under this Agreement at any
time for cause and no later than three (3) years after such cause
has occurred, upon written notice thereof to the Company
specifying the exact cause for Employee's termination.
(b) In the event of termination by the Employee for cause
hereunder:
(1) All of Employee's (including Employee's trusts and
foundations) unvested stock and stock options
shall immediately vest 100% and Employee (including
Employee's trusts and foundations) shall have the
option to either (a) receive an immediate payment of
the Market Value of 100% of his Stock and the higher of
(i) the value according to the Black and Scholes model,
or (ii) the "in-the-money value" of his stock
options/warrants as of the date of such written notice,
or (b) receive an immediate cash bonus from the Company
enabling Employee (including Employee's trusts and
foundations), after full payment of all of Employee's
(including Employee's trusts and foundations) taxes on
such cash bonus, to exercise 100% of his stock
options/warrants, and to continue to hold his Stock,
with the right to "put" or sell the Stock back to the
Company for cash at Market Value. This right to "put"
or sell the Stock back to the Company shall be in full
force and effect and valid and exercisable at any time
and as how many times as Employee wishes, in whole or
in part, within three (3) years after Employee's
termination for cause, at Employee's (including
Employee's trusts and foundations) sole election.
(2) A lump sum cash retirement benefit payment of three (3)
times the Employee's then current annual salary
plus three (3) times the Employee's average bonus for
the last three years shall be made to Employee within
30 days of such written notice.
(3) Employee may also, in addition to, and not in limitation
of payments under Section 5.3(b)(1) and Section
5.3(b)(2) hereunder, at his sole option, elect to serve
as a consultant to Company (working from his then
current residence) for an additional period of three
(3) years at his then current salary, his previous
year's bonus and current benefits, including but not
limited to reimbursement of all Reasonable Expenses.
During such consulting period, Employee would be
required to keep himself reasonably available to the
Company to render advice or to provide services for no
more than thirty (30) days per year.
(4) Employee (including Employee's trusts and foundations)
shall be made whole on an after-tax basis (in a
timely fashion and in a way not to create any liability
for Employee, including Employee's trusts and
foundations) with respect to any taxes that might
become payable as a result of any action or provision
in connection with a Change of Control.
5.4 Effective Date of Termination.
---------------------------------
Unless otherwise specified, the effective date of termination,
as used in this Section 5, shall be the date on which Employee receives
written notice of termination from the Company or gives written notice
of termination to the Company.
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6. Indemnification.
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So long as Employee is not found by a court of law to be guilty of a
willful and material breach of this Agreement, or to be guilty of willful gross
misconduct, he shall be indemnified by the Company from and against any and all
losses, liability, claims and expenses, damages, or causes of action,
proceedings or investigations, or threats thereof (including reasonable attorney
fees and expenses of counsel satisfactory to and selected by Employee) incurred
by Employee, arising out of, in connection with, or based upon Employee's
services and the performance of his duties pursuant to this Employment
Agreement, or any other matter contemplated by this Employment Agreement,
whether or not resulting in any such liability; and Employee shall be reimbursed
by the Company as and when incurred for any reasonable legal or other expenses
incurred by Employee in connection with investigating or defending against any
such loss, claim, damage, liability, action, proceeding, investigation or threat
thereof, or producing evidence, producing documents or taking any other action
in respect thereto (whether or not Employee is a defendant in or target of such
action, proceeding or investigation).
7. Burden and Benefit.
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Unless the express provisions of a particular section of this Agreement
state otherwise, or performance thereunder would be impossible, this Agreement
shall be binding upon, and shall inure to the benefit of, Employer and Employee,
and their respective heirs, personal and legal representatives, successors,
and assigns. It shall also be expressly binding upon and inure to the benefit
of any person or entity assuming the Corporation/Company, by merger,
consolidation, purchase of assets or stock, or otherwise. The interests of the
Employee hereunder are not subject to the claims of his creditors, and may not
be voluntarily or involuntarily assigned, alienated or encumbered; provided,
that Employee may assign all or any part of his rights, duties and obligations
hereunder to any entity (e.g., a partnership or management company) so long as
the services to be performed hereunder are personally performed by him.
8. Governing Law.
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It is understood and agreed that the construction and interpretation of
this Agreement shall at all times and in all respects be governed by the laws of
the country of the Company's and/or the Employee's residence. The Company agrees
to cover all costs, including legal, arising in connection with drafting,
interpreting and implementing this Employment Agreement, both for the Company
and for Employee.
9. Severability.
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The provisions of this Agreement shall be deemed severable, and the
invalidity or unenforceability of any one or more of the provisions of this
Agreement shall not affect the validity and enforceability of the other
provisions.
10. Notice.
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Any notice required to be given hereunder shall be sufficient if it is in
writing and sent by certified or registered mail, return receipt requested,
first-class postage prepaid, to the following respective addresses, which may
hereafter be changed by written notice to the other party:
Employer: Century Casinos, Inc.
200 - 000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxx Xxxxx, XX. 00000
XXX
Employee: Xx. Xxxxx Haitzmann
Xxxxxxxxx Xxxxxx - Xxxxx 00
X-0000 Xxxxx Xxxxxxxxxx xx Xxxxxxx
Xxxxxxx / Europe
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11. Interpretation, Minor Adjustments.
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11.1 No representations, promises, agreements, or understandings,
written or oral, not contained herein shall be of any force or effect. No
change or modification of this Agreement shall be valid or binding unless it is
in writing and signed by the party intended to be bound. No waiver of any
provision of this Agreement shall be valid unless it is in writing and signed by
the party against whom the waiver is sought to be enforced. No valid waiver of
any provision of this Agreement at any time shall be deemed a waiver of any
other provision of this Agreement at such time or at any other time.
11.2 The Compensation Committee shall have absolute authority to amend,
interpret and administer this Agreement, in good faith, and in the best
interests of both the Company and Employee, and may make such adjustments or
amendments hereto as may be reasonably required, if the rights of the Employee
are not adversely affected thereby.
12. Confidentiality.
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Other than in the performance of his duties hereunder, Employee agrees not
to disclose, either during the term of his employment by the Company or at any
time thereafter, to any person, firm or corporation any confidential information
concerning the business affairs, financial affairs, know-how, private documents,
reports, plans, proposals, marketing and sales plans, or similar information of
the Company. Any such documents, techniques, methods, processes or technologies
used by the Company shall be considered confidential and a "trade secret" for
the purposes of this Agreement.
13. Counterparts and Annexure.
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The Agreement may be executed in two or more counterparts, any one of
which shall be deemed the original without reference to the others. Annexure A
(Definitions) shall be an integral part of this Agreement and the Agreement
shall not be complete without it.
IN WITNESS WHEREOF, Employer and Employee have duly executed this Agreement
as of the day and year first above written.
EMPLOYER:
CENTURY CASINOS, INC.
By: /s /Xxxxx Xxxxxxxxxx
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Vice Chairman,
Compensation Committee
By: /s /Xxxxx Xxxxxxx
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Member, Compensation Committee
EMPLOYEE:
By: /s/ Xxxxx Haitzmann
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Xxxxx Haitzmann
Chairman & CEO
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ANNEXURE A
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Definitions:
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As used in this Agreement, the following terms shall have the respective
meanings indicated.
Reasonable Expenses.
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Reasonable expenses shall include, but not be limited to, all out-of-pocket
expenses for entertainment, travel (economy flights within the USA, wherever
reasonably available, business class on other continental flights, and one class
above business class on inter-continental long distance flights), meals,
lodging, automobile expenses, communications and office costs and the like
incurred by the Employee.
Cause (as used in 5.2).
----------------------
For purposes hereof, the term "cause" shall mean the failure of Employee for any
reason, within thirty (30) days after receipt by Employee of written notice
thereof from the Company, to correct, cease, or otherwise alter (i) any specific
action or omission to act that constitutes a material and willful breach of this
Agreement likely to result in material damage to the Company; or (ii) any
willful gross misconduct likely to result in material damage to the Company.
Cause (as used in 5.3).
--------------------------
For purposes hereof, the term "for cause" shall mean: (i) the failure of the
Company for any reason, within thirty (30) days after receipt by the Company of
written notice from Employee, to correct, cease, or otherwise alter any material
adverse change in the conditions of Employee's employment, including, but not
limited to any change in Employee's title or position as Chairman and CEO, or
the duties of such position (such as, but not limited to another person assuming
the same or similar title, position or duties, or one or more of the Employee's
primary duties being assigned to be performed by the Employee in a country other
than his country of primary residence), unless Employee consents in writing to
such change; or (ii) a "Change of Control" of the Company occurs, or has
previously occurred at any time during Employee's employment hereunder. "Change
of Control" as used herein shall mean: (a) any person or entity (not affiliated
with the Employee) becoming the beneficial owner of a majority of the voting
rights of the Company's then outstanding securities; (b) the triggering of the
issuance of stock rights to Shareholders pursuant to the Company's Stock Rights
Agreement, as amended from time to time; (c) the replacement during any two
calendar years of half or more of the existing Board of Directors of the
Company; (d) the replacement, or rejection (i.e. through a proxy fight), of one
or more person(s), nominated to be Director(s) by the Company's Board of
Directors before any Change of Control; (e) Xx. Xxxxx Xxxxxxxxxx is no longer
Vice Chairman and President of the Company, unless because of his death or
permanent disability; (f) holders of the Company's securities approve a merger,
consolidation or liquidation of the Company.
Market Value.
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The higher of (i) the highest closing ask price of the Company's common stock
during the 52 (fifty two) weeks immediately preceding the termination of
Employee, or (ii) the highest closing ask price of the Company's common stock
during the 52 (fifty two) weeks immediately preceding the date Employee
exercised his option under any given article or paragraph of this Agreement.
Stock.
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The term "Stock" shall include any and all shares of common and/or preferred
stock, of the Company and of any subsidiary of the Company owned by the Employee
(including Employee's trusts and foundations), no matter how and when acquired
(including through exercise of options and/or warrants).
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