23
PH02/243474.1
Exhibit 10.65
EMPLOYMENT AGREEMENT
AGREEMENT, dated as of October 1, 1996 between Players
International, Inc. (together with its successors or assigns as
permitted under this agreement, the "Company"), and Xxxxxx X.
Xxxxxxxx ("Executive").
W I T N E S S E T H:
The Company and Executive entered into an Employment
Agreement as of May 19, 1993 (the "Agreement"). The parties now
desire to amend and restate the Agreement to reflect Executive's
current position, compensation and other arrangements with the
Company. Therefore, in consideration of the premises and mutual
covenants contained herein and for other good and valuable
consideration, the Company and Executive (individually a "Party"
and together the "Parties") agree that the Agreement is amended
and restated as of October 1, 1996, to read as follows:
1. Definitions
(a) "Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in Rule 12b-2 of the
General Rules and Regulations under the Securities Exchange Act
of 1934, as amended (the "Exchange Act").
(b) "Base Compensation" shall mean the compensation
provided for in Paragraph 4, subject to such increases as may be
approved by the Board from time to time.
(c) "Beneficial Owner" of any securities shall mean:
(i) that such Person or any of such Person's
Affiliates or Associates, directly or indirectly, has the right
to acquire (whether such right is exercisable immediately or only
after the passage of time) pursuant to any agreement, arrangement
or understanding (whether or not in writing) or upon the exercise
of conversion rights, exchange rights, rights, warrants or
options, or otherwise; provided, however, that a Person shall not
be deemed the "Beneficial Owner" of securities tendered pursuant
to a tender or exchange offer made by such Person or any of such
Person's Affiliates or Associates until such tendered securities
are accepted for payment, purchase or exchange;
(ii) that such Person or any of such Person's
Affiliates or Associates, directly or indirectly, has the right
to vote or dispose of or has "beneficial ownership" of (as
determined pursuant to Rule 13d-3 of the General Rules and
Regulations under the Exchange Act), including without limitation
pursuant to any agreement, arrangement or understanding, whether
or not in writing; provided, however, that a Person shall not be
deemed the "Beneficial Owner" of any security under this
subparagraph (ii) as a result of an oral or written agreement,
arrangement or understanding to vote such security if such
agreement, arrangement or understanding (A) arises solely from a
revocable proxy given in response to a public proxy or consent
solicitation made pursuant to, and in accordance with, the
applicable provisions of the General Rules and Regulations under
the Exchange Act, and (B) is not then reportable by such Person
on Schedule 13D under the Exchange Act (or any comparable or
successor report); or
(iii) where voting securities are beneficially
owned, directly or indirectly, by any other Person (or any
Affiliate or Associate thereof) with which such Person (or any of
such Person's Affiliates or Associates) has any agreement,
arrangement or understanding (whether or not in writing) for the
purpose of acquiring, holding, voting (except pursuant to a
revocable proxy as described in the proviso to subparagraph (ii)
above) or disposing of any voting securities of the Company;
provided, however, that nothing in this Paragraph l(c) shall
cause a Person engaged in business as an underwriter of
securities to be the "Beneficial Owner" of any securities
acquired through such Person's participation in good faith in a
firm commitment underwriting until the expiration of forty days
after the date of such acquisition.
(d) "Board" shall mean the Board of Directors of the
Company.
(e) "Business Day" shall mean any day other than a
weekend, a federal or state holiday or a vacation day for
Executive.
(f) "Cause" shall mean (i) Executive is convicted of a
felony involving moral turpitude; (ii) Executive uses alcohol or
any unlawful controlled substance to an extent that it interferes
on a continuing and material basis with the performance of his
duties under the Agreement; (iii) Executive engages in the
willful, unauthorized disclosure of Confidential Information, as
defined in Paragraph 10(c), concerning the Company or any
Subsidiary, unless such disclosure was (A) believed in good faith
by Executive to be appropriate in the course of properly carrying
out his duties under the Agreement, or (B) required by an order
of a court having jurisdiction over the subject matter or a
summons, subpoena or order in the nature thereof of any
legislative body (including any committee thereof) or any
governmental or administrative agency; (iv) Executive, other than
in the course of properly carrying out his duties under the
Agreement, performs services for any other corporation or person
that competes with the Company or any Subsidiary; or (v)
Executive, in carrying out his duties under the Agreement,
engages in willful neglect or willful misconduct resulting, or
reasonably likely to result, in either case, in material economic
harm to the Company, unless such act, or failure to act, resulted
from Executive's reasonable belief that such act or failure to
act was in the best interests of the Company.
(g) "Change in Control" shall mean the occurrence of
any one of the following events:
(i) any Person (except the Xxxxxxx Group or its
Affiliates and Associates, Company management as of the Effective
Date and their Affiliates and Associates or the Company or any
employee benefit plan of the Company or of any Affiliate, any
Person or entity organized, appointed or established by the
Company for or pursuant to the terms of any such employee benefit
plan), together with all Affiliates and Associates of such
Person, shall become the Beneficial Owner in the aggregate of 30%
or more of the Voting Stock then outstanding; provided, however,
that no "Change of Control" shall be deemed to occur during any
period in which any such Person, and its Affiliates and
Associates, are bound by the terms of a standstill agreement
under which such parties have agreed not to acquire more than 30%
of the Voting Stock then outstanding or to solicit proxies;
(ii) consummation by the Company of a reorganization,
merger or consolidation (a "Business Combination"), in each case,
with respect to which all or substantially all of the individuals
and entities who were the respective Beneficial Owners of the
Voting Stock outstanding immediately prior to such Business
Combination do not, following such Business Combination,
Beneficially Own, directly or indirectly, more than 50% of the
then outstanding shares of voting stock of the corporation
resulting from such Business Combination in substantially the
same proportion as their ownership immediately prior to such
Business Combination of the outstanding Voting Stock;
(iii) consummation of a complete liquidation or
dissolution of the Company;
(iv) sale or other disposition of all or substantially
all of the assets of the Company other than to a corporation with
respect to which, following such sale or disposition, more than
50% of the then outstanding shares of voting stock is then owned
beneficially, directly or indirectly, by all or substantially all
of the individuals and entities who were the Beneficial Owners,
respectively, of the outstanding Voting Stock immediately prior
to such sale or disposition in substantially the same proportion
as their ownership of the outstanding Voting Stock immediately
prior to such sale or disposition;
(v) individuals who, as of the beginning of any twenty-
four month period, constitute the Board (the "Incumbent Board")
cease for any reason to constitute at least a majority of the
Board, provided that any individual becoming a director
subsequent to the beginning of such period whose election or
nomination for election by the Company's stockholders was
approved by a vote of at least a majority of the directors then
comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding,
for this purpose, any such individual whose initial assumption of
office is in connection with an actual or threatened election
contest relating to the election of members of the Board (as such
terms are used in Rule 14a-11 of Regulation 14A promulgated under
the Exchange Act); or
(vi) a "change of control" as defined in the form of
indenture governing any indebtedness of the Company shall have
occurred.
(h) "Constructive Termination Without Cause" shall
mean that:
(i) without Executive's prior written consent, one or
more of the following events occurs:
(A) Executive is removed from the position of
Chief Executive Officer of the Company for any reason other than
the termination of his employment;
(B) Executive suffers a material diminution in
the authorities, duties, reporting relationships or
responsibilities normally associated with the foregoing position
or there are assigned to him duties and responsibilities
materially inconsistent with those normally associated with such
position;
(C) Executive's Base Compensation as provided for
in Paragraph 4 is decreased by the Company, or his benefits under
any material employee benefit plan or program of the Company or
his incentive or equity opportunity under any material incentive
or equity program of the Company is or are reduced, after taking
into account the discretion of the Board to determine the level
at which Executive participates in any performance compensation
program as provided in Paragraph 4, on a basis not shared in
common with other senior executives of the Company as a group;
(D) the Company fails to obtain a written
agreement from any successor of the Company to assume and perform
the Agreement; or
(E) following a Change of Control, the Company
moves its principal executive offices more than 50 miles from
Atlantic City, New Jersey, or such other place where the
Company's principal executive offices are located immediately
prior to the Change of Control) or Executive is removed from
membership on, or fails to be reelected to, the Board, if
Executive is a member of the Board immediately prior to the
Change of Control; and
(ii) within 90 days of learning of the occurrence
of such event, Executive terminates his employment with the
Company.
(i) "Disability" shall mean Executive's inability, for
a period of six consecutive months, to render substantially the
services provided for in Paragraph 3(a) by reason of permanent
mental or physical disability, whether resulting from illness,
accident or otherwise. In the case of a dispute as to whether
Executive has incurred a Disability, Executive agrees to submit
to a physical examination by two physicians, one selected by
Executive and the other by the Company and, in the event they do
not agree, to a physical examination by an additional physician
selected by the first two physicians whose decision shall be
final and binding on both parties.
(j) "Person" shall mean any individual, firm,
corporation, partnership or other entity.
(k) "Subsidiary" shall mean any corporation in which
the Company owns 50% or more of the Voting Stock or any other
venture in which it owns 50 % or more of the equity.
(l) "Term of Employment" shall mean the three-year
period specified in Paragraph 2.
(m) "Termination by the Company Due to Loss of
License" shall mean a termination of Executive's employment by
the Company following a termination of Executive's license to
take part in the casino and gaming business in any state in which
the Company conducts business (other than a termination of such
license (i) due to Executive's death or Disability or (ii) based
upon facts that constitute Cause within the meaning of this
Agreement).
(n) "Termination Upon a Change in Control" shall mean
that following a Change in Control (i) the Company terminates
Executive's employment without Cause, (ii) there is a
Constructive Termination Without Cause, or (iii) Executive
terminates employment from the Company within 180 days of the
Change of Control because, in the good faith determination of
Executive, there has been a change in circumstances with the
Company that directly or indirectly affects Executive's position,
duties or responsibilities or status as in effect immediately
preceding the Change of Control and he is no longer able
effectively to discharge his duties and responsibilities and the
Board concurs in such determination, by a majority vote of the
members who were members prior to the Change of Control, made in
a reasonable fashion, excluding for this purpose any such members
who would not have been treated as members of the Incumbent
Board.
(o) "Voting Stock" shall mean capital stock of any
class or classes having general voting power under ordinary
circumstances, in the absence of contingencies, to elect the
directors of a corporation.
2. Term of Employment.
(a) The Company hereby continues to employ Executive,
and Executive hereby accepts such continuation of employment, in
the position and with the duties and responsibilities as set
forth in Paragraph 3 for the Term of Employment, subject to the
terms and conditions of the Agreement.
(b) The Term of Employment shall commence on the date
hereof and shall, unless sooner terminated as provided in
Paragraph 9, terminate upon the close of business on September
30, 1999 unless it has sooner terminated as provided in Paragraph
9.
3. Position, Duties and Authorities.
(a) During the Term of Employment, Executive shall be
employed as Chief Executive Officer of the Company and, subject
to supervision by the Board, he shall have overall charge of the
business operations of the Company, with the duties
responsibilities and authorities normally associated with such
position. It is also the intention of the Parties that Executive
shall serve as a director of the Company throughout the Term of
Employment but, except as provided in Paragraph 1(h)(i)(E), it
shall not be a breach of the terms of this Agreement if Executive
is not elected or reelected to the Board. Executive shall be
entitled to no additional remuneration for serving on the Board
or as an officer or director of a Subsidiary.
(b) Anything herein to the contrary notwithstanding,
nothing shall preclude Executive from (i) engaging in charitable,
community and business affairs, managing his personal investments
and serving as a member of boards of directors so long as such
activities do not materially interfere with his carrying out his
duties and responsibilities under the Agreement or (ii) having
his name appear in the name of the law firm in which he was a
member immediately prior to his employment by the Company and
receiving nominal compensation therefor so long as Executive
renders no services to such firm.
(c) During the term of Employment, Executive shall
perform his services from an office in Atlantic City, New Jersey
and at such other offices of the Company as may be required by
his duties; provided, however, that Executive shall not be
required to move his home from Xxxxxxx, New Jersey.
4. Base Compensation. During the Term of Employment,
Executive shall be paid by the Company Base Compensation payable
no less frequently than in equal semi-monthly installments at an
annualized rate of no less than $450,000 per annum, subject to
annual review by the Board for possible increase in accordance
with its normal review procedure for senior level executives.
The Company shall be entitled to make proper withholdings from
Executive's Base Compensation (and all other payments of
compensation under this Agreement) as required by law.
5. Performance Bonus. The Company may, but is not
required, to adopt a bonus or short term performance compensation
program for senior level executives. In the event that such a
program is adopted, Executive shall participate in such program
but the Board shall determine Executive's level of participation
for each year of the Term of Employment in its sole discretion;
provided, however, that the Board shall have the discretion to
grant additional individual bonus compensation in excess of the
foregoing general performance bonus program to Executive or any
other executive or the Company in recognition of performance
achievements particular to any of them.
6. Stock Options and Stock Grant. The Company may, but is
not required, to grant to Executive shares of Voting Stock as
well as stock options to purchase shares of Voting Stock subject
to restrictions determined by the Board, in either event in the
sole discretion of the Board, for any year during the Term of
Employment, which shall be made pursuant to an equity
compensation plan approved by the Board generally for senior
level executives of the Company; provided, however, that the
Board shall have the discretion to grant additional options or
restricted shares to Executive or any other executive or the
Company in recognition of performance achievements particular to
any of them. The Company shall use its best effort to maintain
any and all registration statements for any shares subject to
option to permit such shares to be freely tradeable upon
exercise.
7. Employee Benefit Programs. During the Tern of
Employment, Executive and his spouse and dependents shall be
entitled, at the Company's expense, to the employee welfare
benefit and retirement benefit coverages provided to Executive
and his spouse and dependents on the date of this Agreement as
listed on Exhibit A hereto and incorporated herein (the "Employee
Benefit Programs"); provided, however, that the foregoing shall
not prohibit the Company from amending or terminating any such
Employee Benefit Program so long as Executive and his spouse an
dependents otherwise receive the required levels of coverage in
the aggregate; and provided, further, that Executive may request
the Compensation Committee of the Board, which shall decide in
its sole discretion, to permit the Company to change any of the
coverages provided hereunder. To the extent possible, the amount
of any life insurance shall be provided by an individual policy
(or policies) that gives Executive, his legal representatives or
beneficiaries, and trusts of which Executive was the settlor, as
applicable, the right to assume the policy, upon payment to the
Company of the cash surrender value, in the event of his
termination of employment.
8. Business Expense Reimbursement. During the Term of
Employment, Executive shall be entitled to receive reimbursement
by the Company, upon submission of adequate documentation, for
all reasonable, out-of-pocket ordinary and necessary business
expenses incurred by him in performing services under the
Agreement. In addition, any reasonable legal fees and expenses
incurred in connection with the preparation and negotiation of
the Agreement or qualification as a licensee in any jurisdiction
shall be paid by the Company.
9. Termination of Employment.
(a) Termination Due to Death or Disability. In the
event of the termination of Executive's employment under the
Agreement due to his death or Disability, Executive or his legal
representatives as the case may be, shall be entitled to:
(i) (A) in the case of death, continued Base
Compensation at the rate in effect at the time of his death for a
period of 3 months following the month in which such termination
of employment due to death occurs, or (B) in the case of
Disability, the disability benefit available under and only to
the extent of the insurance maintained as provided in Paragraph
7;
(ii) any performance or special incentive bonus earned
but not yet paid;
(iii) a pro rata portion of any applicable
performance bonus for the year in which his employment terminates
due to death or Disability based on performance of the Company
for the year during which such termination occurs or, if
performance results are not available, based on the performance
bonus, if any, paid to Executive for the prior year; and
(iv) any other compensation and benefits to which he or
his legal representatives or beneficiaries may be entitled under
applicable plans, programs and agreements of the Company,
including, without limitation, life insurance benefits and the
right to acquire any life insurance policy which has not then
matured for the cash surrender value pursuant to Paragraph 7.
(b) Termination by the Company for Cause. Within 60
days of knowing, or having reasonable basis for knowing, of an
event constituting Cause the Company may give Executive written
notice of its intention to terminate him for Cause, specifying in
such notice the event forming the basis for Cause. The preceding
sentence notwithstanding, Executive's employment shall not be
deemed to have been terminated for Cause unless the Company has
given or delivered to Executive (1) reasonable notice setting
forth the reasons for the Company's intention to terminate
Executive's employment for Cause; (2) if the written notice is of
an event constituting Cause under clause (ii) or (iv) of
Paragraph l(f) and if the event is capable of being cured,
Executive shall have 10 Business Days following actual receipt of
such notice in which to cure; (3) a reasonable opportunity at any
time during the 30-day period after Executive's receipt of such
notice, for Executive, together with his counsel, to be heard
before the Board, and (4) a second written notice from the
Company stating that, in the good faith opinion of not less than
a majority of the entire membership of the Board, Executive was
guilty of the conduct giving rise to termination for Cause;
provided, however, that the Company may, in its sole discretion,
suspend Executive from performance of his duties on the date of
delivery of such notice and such date shall be the effective date
of any termination under this Paragraph. In the event
Executive's employment is terminated by the Company for Cause,
Executive shall be entitled to:
(i) unpaid Base Compensation earned or accrued at the
rate in effect at the time of his termination through the date of
termination of his employment;
(ii) any performance or special incentive bonus earned
but not yet paid;
(iii) reimbursement for expenses incurred but not
yet reimbursed by the Company pursuant to Paragraph 8; and
(iv) any other compensation and benefits to which he
may be entitled under applicable plans, programs and agreements
of the Company.
Executive's entitlement to the foregoing shall be without
prejudice to the right of the Company for any damages to which it
may be entitled as a result of such Cause.
(c) Termination Without Cause; Constructive
Termination Without Cause; Expiration of the Agreement. In the
event Executive's employment is terminated by the Company without
Cause (which shall not include a termination pursuant to
Paragraph 9(a) or 9(d)) or in the event of a Constructive
Termination Without Cause, or in the event this Agreement expires
by its terms on the third anniversary of the date hereof or the
expiration date of any renewal and the Company has not, at least
six months prior to such date, given Executive written notice of
its intention not to renew the Agreement ("Non-Renewal Notice"),
Executive, upon executing and not revoking a release of the
Company as to all matters arising in the course of his employment
by the Company and the termination thereof, in the form attached
hereto as Exhibit B, shall be entitled to receive:
(i) unpaid Base Compensation earned or accrued through
his date of termination and continued Base Compensation payments,
at the rate in effect at the time of his termination, for (A)
solely in the case of expiration of this Agreement by its terms
on the third anniversary, a number of months equal to six months
minus the number of months of notice of Non-Renewal actually
provided to Executive or (B) in all other cases to which this
Paragraph 9(c) is applicable, a period of 12 months following
termination of his employment or through the end of the Term of
Employment, whichever is longer, payable, at Executive's option,
either (1) over such 12 months or the remaining Term of
Employment, as the case may be, or (2) in a lump-sum payment
promptly following termination of Executive's employment equal to
the then present value using a discount rate per annum determined
by reference to the discount rate then published by the Pension
Benefit Guaranty Corporation for determining the value of
immediate annuities (the "Present Value") of the remaining Base
Compensation due Executive through the end of such 12 months or
the remaining Term of Employment;
(ii) except in a case of a termination of employment by
reason of expiration of this Agreement on the third anniversary
of the date hereof, continued performance bonuses for a period of
12 months following termination of his employment or through the
end of the Term of Employment, whichever is longer, in amounts
determined under the then applicable program of the Company, or,
to the extent such amounts are not reasonably determinable, in
amounts based on performance bonuses paid to Executive for the
last complete fiscal year of the Company ended prior to the
completion of such 12-month period;
(iii) any performance or special incentive bonus
earned but not yet paid;
(iv) reimbursement for expenses incurred but not
yet reimbursed by the Company pursuant to Paragraph 8;
(v) the immediate vesting of all stock options
previously granted to Executive, notwithstanding the terms of any
such grant to the contrary, with and the ability to exercise any
such options for 12 months following the date of termination but
in no event after the expiration of the option term; and
(vi) any other compensation and benefits to which he
may be entitled under applicable plans, programs and agreements
of the Company, including, without limitation, life insurance
benefits, and the right to acquire any life insurance policy
which has not then matured for the cash surrender value pursuant
to Paragraph 7, and the continuation of all Employee Benefit
Programs provided under Paragraph 7 during the period for which
Executive is to receive payments under clause (i) above
(irrespective of the fact that such payments are paid in a lump
sum); provided, however, that in the event the Company is
precluded from providing coverage under any such program by
applicable law or regulation it may choose to provide Executive
with a payment equal to the cost of such coverage without regard
to tax effect.
(d) Termination Upon a Change in Control. In the
event a Termination Upon a Change in Control occurs, or in the
event Executive is terminated under subparagraph (c) within six
months prior to the occurrence of a Change in Control, Executive
shall be entitled to receive (taking into account any benefits
provided under subparagraph (c)), promptly following his
termination of employment:
(i) unpaid Base Compensation earned or accrued through
his date of termination and a lump-sum payment equal to the
Present Value of Executive's Base Compensation that would be due
him for a period of 36 months following termination of his
employment, determined on the basis of the average of the Base
Compensation paid to Executive for the 36 months preceding his
termination;
(ii) a lump-sum payment equal to the Present Value of
the aggregate performance bonus amounts he received, if any, for
the period of 36 months preceding his termination or, if greater,
a lump-sum payment equal to 150% of the largest performance bonus
paid to Executive during the 36 months preceding his termination;
(iii) any performance or special incentive bonus
earned but not yet paid;
(iv) reimbursement for expenses incurred but not yet
reimbursed by the Company pursuant to Paragraph 8;
(v) the immediate vesting of all stock options
previously granted to Executive, notwithstanding the terms of
any such grant to the contrary, with the ability to exercise any
such options for 12 months following the date of termination but
in no event after the expiration of the option term; and
(vi) any other compensation and benefits to which he
may be entitled under applicable plans, programs and agreements
of the Company and the right to acquire any life insurance policy
which has riot then matured for the cash surrender value pursuant
to Paragraph 7, and the continuation of all Employee Benefit
Programs provided under Paragraph 7 during the period for which
Executive is to receive payments under clause (i) above
irrespective of the fact that such payments are paid in a lump
sum); provided, however, that in the event the Company is
precluded from providing coverage under any such program by
applicable law or regulation it may choose to provide Executive
with a payment equal to the cost of such coverage without regard
to tax effect.
Notwithstanding the foregoing, in the event that it shall be
determined that any payment or distribution by the Company to or
for the benefit of Executive, whether paid or payable or
distributed or distributable pursuant to the terms of this
Agreement or otherwise (a "Payment"), would constitute an "excess
parachute payment" within the meaning of Section 280G of the
Internal Revenue Code of 1986, as amended (the "Code"), and that
it would be economically advantageous to the Company to reduce
the Payment to avoid or reduce the limitation of the Company's
federal income tax deduction under Section 280G of the Code, the
aggregate present value of amounts payable or distributable to or
for the benefit of Executive pursuant to this Agreement (such
payments or distributions pursuant to this Agreement are
hereinafter referred to as "Agreement Payments") shall be reduced
(but not below zero) to the Reduced Amount. The "Reduced Amount"
shall be an amount expressed in present value which maximizes the
aggregate present value of Agreement Payments without causing any
Payment to be subject to the limitation of deduction under
Section 280G of the Code. For purposes of this subparagraph (d),
"present value" shall be determined in accordance with Section
280G(d)(4) of the Code. All determinations to be made under this
Paragraph 9(d) shall be made by the Company's independent public
accountant immediately prior to the Change of Control (the
"Accounting Firm"), which firm shall provide its determinations
and any supporting calculations both to the Company and Executive
within 10 days of the termination date. Any such determination
by the Accounting Firm shall be binding upon the Company and
Executive. Executive shall in his sole discretion determine
which and how much of the Agreement Payments shall be eliminated
or reduced consistent with the requirements of this Paragraph
9(d). Within five days after Executive's determination, the
Company shall pay (or cause to be paid) or distribute (or cause
to be distributed) to or for the benefit of Executive such
amounts as are then due to Executive under this Agreement. All
of the fees and expenses of the Accounting Firm in performing the
determinations referred to above shall be borne solely by the
Company. The Company agrees to indemnify. and hold harmless the
Accounting Firm of and from any and all claims, damages and
expenses resulting from or relating to its determinations
pursuant to this Paragraph, except for claims, damages or
expenses resulting from the gross negligence or willful
misconduct of the Accounting Firm.
(e) Termination of the Company Due to Loss of License.
In the event of a Termination by the Company Due to Loss of
License, Executive shall be entitled to:
(i) unpaid Base Compensation earned or accrued through
the date of termination and continued Base Compensation payments
at the rate in effect at the time of termination, for six months;
(ii) any performance bonus earned but not yet paid;
(iii) reimbursement for expenses incurred but not
yet reimbursed by the Company pursuant to Paragraph 8; and
(iv) any other compensation and benefits to which he
may be entitled under applicable plans, programs and agreements
of the Company.
Notwithstanding the above, if Executive's Loss of License was not
the result of any activity that Executive knew, or should have
known, would result in his Loss of License, then the Base
Compensation continuation provided for in subparagraph (i) above
shall be for 12 months rather than six months.
(f) No Mitigation; No Offset. In the event of any
termination of Executive's employment under the Agreement, he
shall be under no obligation to seek other employment, and there
shall be no offset against amounts due him under the Agreement on
account of any remuneration attributable to any subsequent
employment that he may obtain.
(g) Nature of Payments. Any amounts due Executive
under the Agreement in the event of any termination of his
employment with the Company are in the nature of severance
payments, or liquidated damages which contemplate both direct
damages and consequential damages that be may suffer as a result
of the termination of his employment, or both, and are not in the
nature of a penalty.
10. Covenant Not to Compete; Covenants to Protect
Confidential Information.
(a) If Executive voluntarily terminates his employment
with the Company, or if the Company terminates the Employment of
Executive for Cause, Executive shall not for a one-year period
engage in competition with the Company within the meaning of
Paragraph 10(b). If Executive is terminated on any other basis
resulting in payments to Executive (irrespective of the fact that
such payments are paid in a lump sum) with respect to a period
after such termination (the "Post Termination Payment Period"),
Executive shall not engage in such competition for a period equal
to the Post Termination Payment Period. If Executive is in
breach of this Paragraph 10(a), since a remedy at law will not
suffice to remedy the damage suffered thereby, the Company shall
be entitled to specific performance.
(b) Executive shall be engaging in competition with
the Company if he is engaged in the gaming business within the
primary geographic market area of any location in which the
Company is engaging in the gaming business at the time of the
termination of Executive's employment, whether as an employee,
consultant, partner, principal, agent, representative or
stockholder or in any other corporate or representative capacity,
so long as the Company is engaged in the gaming business in the
location in question. The Company agrees that it is not engaged
in the gaming business in Atlantic City, New Jersey, on the date
of this Agreement. The foregoing restrictions shall not be
construed to prohibit the ownership by Executive of less than
five percent (5 %) of any class of securities of any corporation
which is engaged in any of the foregoing businesses having a
class of securities registered pursuant to the Exchange Act,
provided that such ownership represents a passive investment and
that neither Executive nor any group of persons including
Executive in any way, either directly or indirectly, manages or
exercises control of any such corporation, guarantees any of its
financial obligations, otherwise takes any part in its business,
other than exercising his rights as a shareholder, or seeks to do
any of the foregoing.
(c) Executive shall not, during the Term of Employment
or thereafter, without the prior written consent of the Company,
divulge, publish or otherwise disclose to any other person any
Confidential Information regarding the Company or any Subsidiary
except in the course of carrying out his responsibilities on
behalf of the Company (e.g., providing information to the
Company's attorneys, accountants, bankers, etc.) or if required
to do so pursuant to the order of a court having jurisdiction
over the subject matter or a summons, subpoena or order in the
nature thereof of any legislative body (including any committee
thereof) or any governmental or administrative agency. For this
purpose, Confidential Information shall include, but not be
limited to, the Company's financial , real estate, marketing and
promotional plans and strategies. Confidential Information does
not include information that becomes available to the public
other than through a breach of the Agreement on the part of
Executive.
(d) Executive shall not during the term of Employment
or thereafter, without the prior written consent of a Subject
Party, as hereafter defined, divulge, publish, or otherwise
disclose to any other person any Confidential Information
regarding a Subject Party except in the course of carrying out
responsibilities on behalf of Subject Party (e.g., providing
information to advisors) or if required to do so under
circumstances as described in Paragraph 10(c) in connection with
disclosure of Confidential Information about the Company. For
this purpose, Confidential Information about a Subject Party
shall include non-public financial information about a Subject
Party including non-public information regarding his business and
investment activities. Confidential Information does not include
information that becomes available to the public other than
through a breach of the Agreement on the part of Executive.
Executive further agrees he will not during the Term of
Employment or thereafter publish any book or article about, or
disclose in any public forum, his personal experiences with, or
other personal information about, a Subject Party. Affiliates of
a Subject Party or their respective heirs, successors and assigns
are expressly intended as third party beneficiaries of the
provisions of this Paragraph 10(d) and shall be entitled to
enforce the provisions hereof independent of the Company by
injunction or otherwise and to any damages suffered by reason of
any breach of this Paragraph 10(d). For purposes hereof, Subject
Party shall be Mr. Xxxx Xxxxxxx.
11. Equitable Relief.
(a) Executive acknowledges and agrees that the
restrictions contained in Paragraph 10 are reasonable and
necessary to protect and preserve the legitimate interests,
properties, goodwill and business of the Company, that the
Company would not have entered into this Agreement in the absence
of such restrictions and that irreparable injury will be suffered
by the Company should Executive breach any of the provisions of
that Paragraph. Executive represents and acknowledges that (i)
he has been advised by the Company to consult his own legal
counsel in respect of this Agreement, and (ii) that he has had
full opportunity, prior to execution of this Agreement, to review
thoroughly this Agreement with his counsel.
(b) Executive further acknowledges and agrees that a
breach of any of the restrictions in Paragraph 10 cannot be
adequately compensated by monetary damages. Executive agrees
that the Company shall be entitled to preliminary and permanent
injunctive relief, without the necessity of proving actual
damages, as well as an equitable accounting of all earnings,
profits and other benefits arising from any violation of
Paragraph 10, which rights shall be cumulative and in addition to
any other rights or remedies to which the Company may be
entitled. In the event that any of the provisions of this
Paragraph should ever be adjudicated to exceed the time,
geographic, service, or other limitations permitted by applicable
law in any jurisdiction, it is the intention of the parties that
the provision shall be amended to the extent of the maximum time,
geographic, service, or other limitations permitted by applicable
law, that such amendment shall apply only within the jurisdiction
of the court that made such adjudication and that the provision
otherwise be enforced to the maximum extent permitted by law.
(c) Executive irrevocably and unconditionally (i)
agrees that any suit, action or other legal proceeding arising
out of Paragraph 10, including without limitation, any action
commenced by the Company for preliminary and permanent injunctive
relief and other equitable relief, may be brought in the United
States District Court for the District of New Jersey, or if such
court does not have jurisdiction or will not accept jurisdiction,
in any court of general jurisdiction in Atlantic City, New
Jersey, (ii) consents to the non-exclusive jurisdiction of any
such court in any such suit, action or proceeding, and (iii)
waives any objection which Executive may have to the laying of
venue of any such suit, action or proceeding in any such court.
Executive also irrevocably and unconditionally consents to the
service of any process, pleadings, notices or other papers in a
manner permitted by the notice provisions of Paragraph 21.
12. Indemnification.
(a) The Company shall indemnify Executive to the
fullest extent permitted by Delaware law in effect as of the date
hereof against all costs, expenses, liabilities and losses
(including, without limitation, attorneys' fees, judgments,
fines, penalties, ERISA excise taxes and amounts paid in
settlement) reasonably incurred by Executive in connection with a
Proceeding and this obligation shall survive the termination of
this Agreement with respect to matters arising during the Term of
Employment. For the purposes of this Paragraph 12, "Term of
Employment" shall mean the period commencing May 19, 1993, and
ending on the date specified in Paragraph 2 and a "Proceeding"
shall mean any action, suit or proceeding, whether civil,
criminal, administrative or investigative, in which Executive is
made, or is threatened to be made, a party to, or a witness in,
such action, suit or proceeding by reason of the fact that he is
or was an officer, director or employee of the Company or is or
was serving as an officer, director, member, employee, trustee or
agent of any other entity at the request of the Company.
(b) The Company shall advance to Executive all
reasonable costs and expenses incurred by him in connection with
a Proceeding within 20 days after receipt by the Company of a
written request for such advance. Such request shall include an
itemized list of the costs and expenses and an understanding by
Executive to repay the amount of such advance if it shall
ultimately be determined that he is not entitled to be
indemnified against such costs and expenses.
(c) Executive shall not be entitled to indemnification
under this Paragraph 12 unless he meets the standard of conduct
specified in the Delaware General Corporation Law.
Notwithstanding the foregoing, to the extent permitted by law
neither Section 145(d) of the Delaware General Corporation Law
nor any similar provision shall apply to indemnification under
this Paragraph 12, so that if Executive in fact meets the
applicable standard of conduct, he shall be entitled to such
indemnification whether or not the Company (whether by the board
of directors, the shareholders, independent legal counsel or
other party) determines that indemnification is proper because he
has met such applicable standard of conduct. Neither the failure
of the Company to have made such a determination prior to the
commencement by Executive of any suit or arbitration proceeding
seeking indemnification, nor a determination by the Company that
he has not met such applicable standard of conduct, shall create
a presumption that he has not met the applicable standard of
conduct.
(d) The Company shall not settle any Proceeding or
claim in any manner which would impose on Executive any penalty
or limitation without his prior written consent. Neither the
Company nor Executive will unreasonably withhold its or his
consent to any proposed settlement.
13. Assignability; Binding Nature. This Agreement shall be
binding upon and inure to the benefit of the Parties (and in the
case of Paragraph 10(d), to the benefit of the Subject Party) and
their respective successors, heirs and assigns. No rights or
obligations of the Company under the Agreement may be assigned or
transferred by Executive or the Company except that (a) such
rights or obligations of the Company may be assigned or
transferred pursuant to a merger or consolidation in which the
Company is not the continuing entity, or the sale or liquidation
of all or substantially all of the assets of the Company,
provided that the assignee or transferee is the successor to all
or substantially all of the assets of the Company and such
assignee or transferee assumes the liabilities, obligations and
duties of the Company, as contained in the Agreement, either
contractually or as a matter of law, and (b) such obligations of
the Company may be transferred by Executive by will or pursuant
to the laws of descent or distribution or pursuant to any express
transfer provisions in an instrument granting Executive a stock
option. The Company shall take all reasonable legal action
necessary to effect such assignment and assumption of the
Company's liabilities, obligations and duties under the Agreement
in circumstances clause (a) of the preceding sentence.
14. Representation. The Company and Executive respectively
represent and warrant to each other that, subject to any approval
that may be necessary from any pertinent regulatory authority,
each respectively is fully authorized and empowered to enter into
the Agreement and that its or his entering into the Agreement and
the performance of its or his respective obligations under the
Agreement will not violate any agreement between the Company or
Executive respectively and any other person, firm or organization
or any law or governmental regulation.
15. Entire Agreement The Agreement contains the entire
agreement between the Parties concerning the subject matter
hereof and supersedes all prior agreements, understandings,
discussions, negotiations and undertakings, whether written or
oral, between the Parties with respect thereto.
16. Amendment or Waiver. The Agreement cannot be changed,
modified or amended without the consent in writing of both
Executive and the Company. No waiver by either Party at any time
of any breach by the other Party of any condition or provision of
the Agreement shall be deemed a waiver of a similar or dissimilar
condition or provision at the same or at any prior or subsequent
time. Any waiver must be in writing and signed by Executive or
an authorized officer of the Company, as the case may be.
17. Severability. In the event that any provision or
portion of the Agreement shall be determined to be invalid or
unenforceable for any reason, in whole or in part, the remaining
provisions of the Agreement shall be unaffected thereby and shall
remain in full force and effect to the fullest extent permitted
by law.
18. Survivorship. The respective rights and obligations of
the Parties hereunder shall survive any termination of the
Agreement to the extent necessary to the intended preservation of
such rights and obligations.
19. Governing Law. The Agreement shall be governed by and
construed and interpreted in accordance with the laws of New
Jersey without reference to principles of conflict of laws.
20. Settlement of Disputes. In the event of any dispute
under the provisions of this Agreement other than a dispute in
which the primary relief sought is an equitable remedy such as an
injunction, the parties shall be required to have the dispute,
controversy or claim settled by arbitration in the City of New
York, New York in accordance with the National Rules for the
Resolution of Employment Disputes then in effect of the American
Arbitration Association, before a panel of three arbitrators, two
of whom shall be selected by the Company and Employee,
respectively, and the third of whom shall be selected by the
other two arbitrators. Any award entered by the arbitrators
shall be final, binding and nonappealable and judgment may be
entered thereon by either party in accordance with applicable law
in any court of competent jurisdiction. This arbitration
provision shall be specifically enforceable. The arbitrators
shall have no authority to modify any provision of this Agreement
or to award a remedy for a dispute involving this Agreement other
than a benefit specifically provided under or by virtue of the
Agreement. If Employee prevails on any material issue which is
the subject of such arbitration or lawsuit, the Company shall be
responsible for all of the fees of the American Arbitration
Association and the arbitrators and any expenses relating to the
conduct of the arbitration and the Employee's reasonable legal
fees and expenses. Otherwise, each party shall bear his or its
own expenses relating to the conduct of the arbitration
(including attorneys' fees and expenses) and shall share the fees
of the American Arbitration Association.
21. Notice. Any notice given to either Party shall be in
writing and, except as provided in the second sentence of
Paragraph 9(b), shall be deemed to have been given when delivered
personally or sent by certified or registered mail, postage
prepaid, return receipt requested, duly addressed to de Party
concerned at the address indicated below or to such changed
address as such Party may subsequently give notice of:
If to the Company or the Board:
Players International, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxx Xxxx, XX 00000
Attention: General Counsel
With a copy to:
Xxxxxx, Xxxxx & Bockius
0000 Xxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxxxxxxxxx, Esquire
If to Executive:
Xxxxxx Xxxxxxxx
000 Xxxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
With a copy to:
Willkie, Xxxx & Xxxxxxxxx
One Citicorp Center
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxx, Esquire
22. Headings. The headings of the paragraphs contained in
the Agreement are for convenience of reference only, do not
constitute a part of this Agreement and shall not be deemed to
limit or affect any of the provisions hereof.
23. Counterparts. The Agreement may be executed in two or
more counterparts.
IN WITNESS WHEREOF, the undersigned have executed the
Agreement as of the date first written above.
Players International Inc.
By:
_________________________________
Xxxxxx Xxxxxxx
Its: Chairman
_____________________________________
Xxxxxx Xxxxxxxx
