SEPARATION AGREEMENT AND GENERAL RELEASE
Exhibit 10.1
SEPARATION AGREEMENT AND GENERAL RELEASE
This Separation Agreement (the “Separation Agreement”) is made as of this 3rd day
of March, 2011 by and among Pinnacle Entertainment, Inc. (the “Company”) and Xxxxxxx X. Xxxx
(“Executive,” and together with the Company, the “Parties”).
WHEREAS, Executive has been employed by the Company under terms set forth in the Amended and
Restated Employment Agreement dated as of December 22, 2008 as amended by the First Amendment to
Amended and Restated Employment Agreement dated December 18, 2009 and the Amendment to Stock Option
Agreements and Employment Agreement dated December 22, 2009 by and between Executive and the
Company (collectively, the “Employment Agreement”);
WHEREAS, Executive’s employment with the Company will end by Executive’s separation of
employment (the “Separation”) on March 31, 2011 (the “Separation Date”); and
WHEREAS, the Parties desire to enter into this Separation Agreement in order to set forth the
definitive rights and obligations of the Parties in connection with the Separation.
NOW, THEREFORE, in consideration of the mutual covenants, commitments and agreements contained
herein, and for other good and valuable consideration the receipt and sufficiency of which is
hereby acknowledged, the Parties intending to be legally bound hereby agree as follows:
1. Acknowledgment of Separation. The Parties acknowledge and agree that the Separation
will occur on the Separation Date and that the Separation shall be treated as a termination without
cause other than in connection with a change of control for all purposes under the Employment
Agreement (other than with respect to surviving provisions of the Employment Agreement as set forth
below). In addition, notwithstanding anything to the contrary, the Parties acknowledge and agree
that all provisions of the Employment Agreement will terminate effective as of the Separation Date
(including specifically, but not limited to, Appendix A relating to tax gross-up payments), with
the exception of the provisions of Sections 4.4, 7.1, 7.2, 7.3, 7.4, 7.5, 7.6, 7.7, 7.8, 7.9, 9.7,
9.8., 9.14, 9.15 and Article 8 of the Employment Agreement (collectively, the “Surviving
Employment Agreement Provisions”), which shall survive the Separation and the effectiveness of this
Separation Agreement and will remain in full force and effect after the Separation Date in
accordance with their terms, regardless of the reason for this termination of employment. The
post-separation provisions of the Employment Agreement, including specifically Sections 7.3, 7.4,
7.5, 7.6 and 7.7, with respect to periods after the “Term” (as such term is used in the Employment
Agreement) shall be considered effective as of and shall run from the Separation Date. Upon the
Separation, Executive shall be treated as having resigned from all positions Executive held with
the Company and its subsidiaries, whether as a director, officer, manager or any other position.
2. Executive’s Acknowledgment of Consideration. Executive specifically acknowledges
that the obligations and payments set forth in Section 3(a) below were agreed to by the Parties
upon entering into the Employment Agreement, and the other
obligations and payments of the Company set forth in Section 3 hereof and the release of the Company granted in
Section 6 hereof are being provided by the Company in consideration for the release granted by
Executive in Section 6 hereof.
3. Payments and Benefits Upon and After the Separation.
(a) Accrued Salary, Expenses and Bonus. The Company shall pay or cause to be paid to
Executive all accrued but unpaid base salary. In addition, promptly upon submission by Executive
of his unpaid expenses incurred prior to the Separation Date as described in Article 5 of the
Employment Agreement, reimbursement for such expenses shall be made. The Company shall pay these
amounts within ten (10) days of the Separation Date. In addition, Executive shall receive an
annual bonus for the year 2010 in the amount of Seven Hundred Thirty Thousand Dollars ($730,000)
payable along with other management bonuses no later than March 15, 2011. Executive shall not be
eligible for any bonus for the year 2011 or any subsequent year.
(b) Severance. The severance to be paid to Executive shall be Executive’s annual base
salary of Five Hundred Thousand Dollars ($500,000), payable in equal semi-monthly installments over
twelve (12) months immediately following the Separation Date in accordance with the Company’s
regular salary payment schedule from time to time.
(c) Stock Options, Restricted Stock and Restricted Stock Units. All of Executive’s
vested stock options as of the Separation Date shall survive the Separation Date until the earlier
of (i) June 29, 2012 or (ii) the expiration of the original ten-year term of the vested stock
options (the “Exercise Period”). During the Exercise Period, Executive may exercise such vested
stock options and any of such stock options which remain unexercised shall expire thereafter and be
cancelled and terminated. All unvested stock options, unvested restricted stock and unvested
restricted stock units on the Separation Date are hereby cancelled and terminated.
(d) Other Stock Unit Awards. Effective March 1, 2010, Executive was granted Other
Stock Unit Awards covering 37,500 Shares under the Company’s 2005 Equity and Performance Incentive
Plan (the “Plan”) to vest in two annual equal installments on the first and second anniversaries on
the date of the grant (the “2010 Grant”). Fifty-percent (50%) of the Other Stock Unit Awards have
vested as of March 1, 2011 and the 18,750 Shares corresponding to such vested portion of the 2010
Grant shall be issued to Executive within ninety (90) days of the second anniversary of the grant
date, subject to the provisions of the 2010 Grant and the Plan. The remaining portion of the 2010
Grant that would otherwise vest on March 1, 2012 if Executive were still employed is hereby
cancelled and terminated.
(e) Other Benefits Payments. The Company shall pay or make available to Executive all
benefits described under Section 6.5.3(c) of the Employment Agreement with respect to “Health and
Disability Coverage Continuation” described therein for a maximum period of twelve (12) months from
the Separation Date, conditioned upon Executive’s timely election of COBRA coverage. Executive
shall promptly advise the Company if he becomes covered under other insurance plans. Any
reimbursement that is taxable to the Executive shall be made not later than December 31 of the
calendar year following the calendar year in which Executive or family member incurred the expense.
(f) Tax Withholding. The Company shall be entitled to withhold from any amounts
otherwise payable hereunder to Executive any amounts required to be withheld in respect of federal,
state or local taxes and Executive shall be responsible for all taxes on amounts received under or
related to this Separation Agreement.
(g) No Duty to Mitigate. The payments contemplated herein shall not be subject to any
duty of mitigation by Executive nor to offset for any income earned by Executive following
Separation.
4. Consulting Services; Cooperation.
(a) Consulting. For a period of twelve (12) months beginning on the Separation Date
(the “Consulting Period”), the Company will retain Executive to act on a part-time basis as an
independent consultant (for no additional compensation), as reasonably directed by the Company, in
assisting the Company as determined in the discretion of the Chief Executive Officer, including,
but not limited to the Company’s Baton Rouge project. If Executive takes another executive
position during the Consulting Period (subject to his non-competition restrictions as set forth in
Section 7.4 of his employment agreement), Executive shall have the right to terminate his
obligation to provide consulting services upon written notice to the Company. Executive shall make
himself reasonably available during the Consulting Period, but the parties agree that said
commitment shall not exceed twenty-five (25) hours per month. The Company expressly agrees that
Executive shall only be liable for breach of Executive’s obligations under this Section 4(a) to the
extent Executive engages in gross negligence or willful misconduct with respect to those services
and, in such event, the Company expressly agrees that it shall not be entitled to seek money
damages in excess of $10,000 for all such breaches.
(b) Reimbursement of Expenses; Independent Contractor Status. The Company agrees to
reimburse Executive for all reasonable out-of-pocket costs and expenses incurred in connection with
the consulting services provided under this Section upon presentation of appropriate documentation
thereof. In connection with the Executive’s activities on behalf of the Company as an independent
consultant pursuant to this Section, Executive acknowledges and agrees that he is acting as an
independent contractor, engaged in the conduct of his own separate business and is not a partner,
joint venturer, an agent or employee of the Company for any purpose. Executive also acknowledges
and agrees that Executive has no right or authority or ability to enter into any contracts or
assume any obligations or give any warranties or make any representations on behalf of the Company
or to bind the Company in any way, and Executive will not convey or represent that he has any such
authority. Executive agrees that, other than the consulting services described in this Section,
Executive will not otherwise hold himself out as acting for or on behalf of the Company. The
Company shall indemnify and hold Executive harmless from any claim or liability arising from
actions taken by Executive in good faith in performing the services required under this Section 4,
including any costs of defense or attorney’s fees; provided that (1) the Company shall have the
right, at its expense, to assume or participate in the defense of any claim or action covered by
such indemnity, (2) the Company shall not be liable for any settlement or compromise of any claim
or action covered by such indemnity
unless the Company has consented in writing to such settlement or compromise (which consent shall
not be unreasonably withheld) and (3) the Company shall not be liable under this indemnity to the
extent that it is determined in a final judgment by a court of competent jurisdiction or final
arbitration proceeding that such claim or liability resulted from any acts or failures to act
undertaken or omitted to be taken by Executive through his gross negligence or willful misconduct.
(c) Cooperation. Executive also agrees to cooperate with the Company and its
attorneys in any current or future litigation or claims involving the Company or any of its
subsidiaries in which Executive might be a witness or for which Executive may have material
information including, but not limited to, any and all meetings, depositions, arbitrations,
mediations, trials, etc. This cooperation obligation shall be limited to forty (40) hours per year
and it shall expire on March 31, 2014.
5. Confidential Information; Prohibitions on Certain Actions by Executive;
Cooperation.
(a) Disclosure of Separation Agreement. In addition to and without limiting the
provisions of Section 7.1 of the Employment Agreement, the Executive shall, and the Company agrees
to cause each of the Chief Executive Officer, Chief Financial Officer, General Counsel and any
executive and senior vice president of the Company (the “Designated Company Executives”) to, keep
this Separation Agreement, and the terms and subject matter hereof, strictly confidential, and no
disclosure or public announcement will be made by any of them (except as required by applicable
law, including but not limited to any securities laws and the rules and regulations of the U.S.
Securities and Exchange Commission (the “SEC”)) with respect to this Separation Agreement
(including the existence thereof, or the terms or subject matter hereof) without the prior
agreement of the other Party; provided, however, that (i) the Company may issue a mutually agreed
upon press release announcing Executive’s departure and from time to time may comment on, or make
public disclosures regarding, the Separation in a manner consistent with such press release; (ii)
the Company and Executive may provide this Separation Agreement to and share such information with
applicable gaming regulatory authorities; and (iii) the Company and Executive may share such
information with their legal, tax and accounting advisors. Executive agrees to direct all
inquiries concerning Executive’s employment with the Company to the Company’s Chief Executive
Officer or General Counsel, who will represent that Executive resigned to pursue other
opportunities. Executive acknowledges that the Company intends to file this Separation Agreement
with the SEC as an exhibit to its periodic reports filed with the SEC and to describe its terms in
its SEC filings. The Company acknowledges that Executive may disclose the existence of this
Separation Agreement and any details related thereto to the extent that such information has been
filed by the Company with the SEC or if the Company has otherwise released such information to the
public.
(b) Prohibition on Certain Actions by Executive. Executive acknowledges that, given
Executive’s position with the Company prior to the Separation, Executive possesses substantial
non-public information and other confidential information regarding the Company which has
substantial economic value to the Company, including without limitation information relating to the
Company’s development plans, prospects, and financial, organizational, managerial, administrative,
customer andmarketing information
regarding the Company, much of which the Company considers highly sensitive information.
Executive has agreed, pursuant to Section 7.1 of the Employment Agreement, to, among other things,
not directly or indirectly disclose, divulge, communicate, use or otherwise disclose any such
information. In order to better ensure that such information is not used inappropriately by
Executive, in addition to Executive’s obligations under Section 7.1 of the Employment Agreement,
which survives the Separation and the effectiveness of this Separation Agreement, for a period of
three (3) years from the Separation Date, Executive shall not, nor shall it permit any Affiliate or
Associate (as such terms are hereinafter defined) or representative of Executive (such Affiliates,
Associates and representatives, collectively and individually, the “Executive Affiliates”) to,
directly or indirectly:
(i) effect or seek, offer or propose (whether publicly or otherwise) to effect, or cause or
participate in or in any way assist any other person to effect or seek, offer or propose (whether
publicly or otherwise) to effect or participate in:
(1) any solicitation of proxies or written consents of stockholders, or conduct any other
type of referendum (binding or non-binding) with respect to, or from the holders of, the common
stock of the Company (the “Common Stock”) (other than by voting his or its shares of Common Stock
in a way that does not violate this Separation Agreement), or become a participant in any contested
solicitation with respect to the Company, including without limitation relating to the removal or
the election of directors of the Company or seek representation on the Company’s Board of Directors
or a change in the composition or size of the Company’s Board of Directors;
(2) any acquisition of any securities (or beneficial ownership thereof) or assets of the
Company or any of its subsidiaries (other than the exercise by Executive of stock options held by
Executive as of the Separation Date, and excluding personal, passive investments by Executive in
the Company’s securities from time to time),
(3) any tender or exchange offer, merger or other business combination involving the Company
or any of its subsidiaries, or
(4) any recapitalization, restructuring, liquidation, dissolution or other extraordinary
transaction with respect to the Company or any of its subsidiaries; or
(ii) form, join or participate in a partnership, limited partnership, limited liability
company, syndicate, person or other group, including without limitation a group as defined under
Section 13(d) of the Exchange Act (as defined below), with respect to the Common Stock, or
otherwise assist, support or participate in any effort by any person with respect to the matters
set forth in subparagraph (i) above, or deposit any shares of Common Stock in a voting trust or
subject any shares of Common Stock to any voting agreement;
(iii) otherwise act, alone or in concert with others, to seek to control or influence the
management, Board of Directors or policies of the Company;
(iv) publicly announce any intention to take any action, or take any action which might force
the Company to make a public announcement, in either case, regarding any of the types of matters
set forth in subparagraph (i) above; or
(v) enter into any discussions or arrangements with any person with respect to any of the
foregoing (including the matters set forth in subparagraph (i) above).
Executive also agrees, on behalf of itself and its Affiliates, Associates and representatives, not
to request the Company (or its directors, officers, employees or agents), directly or indirectly,
amend or waive any provision of this Section 8 (including this sentence).
(c) For purposes of this Agreement: the terms “Affiliate” and “Associate” shall have the
respective meanings set forth in Rule 12b-2 promulgated by the SEC under the Securities Exchange
Act of 1934, as amended (the “Exchange Act”) (except that the 10% threshold in the definition of
“Associate” shall be replaced with 1% and beneficial ownership under such definition shall include
the right to acquire securities whether such right is exercisable immediately or only after the
passage of time or only after satisfaction of conditions); and the terms “person” or “persons”
shall mean any individual, corporation (including not-for-profit), general or limited partnership,
limited liability or unlimited liability company, joint venture, estate, trust, association,
organization or other entity of any kind or nature.
6. Executive Release and Waiver.
(a) Executive Release. Executive, for and on behalf of himself and each of his heirs,
executors, administrators, personal representatives, successors and assigns (the “Releasors”), to
the maximum extent permitted by law, hereby fully and forever releases, acquits and discharges the
Company, together with its subsidiaries, parents and affiliates, and each of their past and present
direct and indirect stockholders, directors, members, partners, officers, employees, attorneys,
agents and representatives, and their heirs, executors, administrators, personal representatives,
successors and assigns (collectively, the “Releasees”), from any and all claims, demands, suits,
causes of action, liabilities, obligations, judgments, orders, debts, liens, contracts, agreements,
covenants and causes of action of every kind and nature, whether known or unknown, suspected or
unsuspected, concealed or hidden, vested or contingent, in law or equity, existing by statute,
common law, contract or otherwise, which have existed, may exist or do exist, through and including
the execution and delivery by Executive of this Separation Agreement, including, without
limitation, any of the foregoing arising out of or in any way related to or based upon:
(i) Executive’s application for and employment with the Company, his being an officer,
director or employee of the Company or any of its subsidiaries, or the Employment Agreement or the
Separation;
(ii) any and all claims in tort or contract, and any and all claims alleging breach of an
express or implied, or oral or written, contract, policy manual or employee handbook;
(iii) any alleged misrepresentation, defamation, interference with
contract, intentional or negligent infliction of emotional distress, sexual harassment, negligence
or wrongful discharge; or
(iv) any federal, state or local statute, ordinance or regulation, including but not limited
to the Age Discrimination in Employment Act of 1967, as amended, Title VII of the Civil Rights Act
of 1964, as amended; the Civil Rights Act and Women’s Equity Act of 1991; Sections 1981 through
1988 of Title 42 of the United States Code; the Equal Pay Act of 1963, as amended; the Occupational
Safety and Health Act of 1970; the Americans with Disabilities Act of 1990; the Family and Medical
Leave Act of 1993; the Consolidated Omnibus Budget Reconciliation Act of 1985; the Vocational
Rehabilitation Act of 1973; the Worker Adjustment Retraining and Notification Act of 1988; the
Employee Retirement Income Security Act of 1974; the Fair Labor Standards Act and the National
Labor Relations Act, as amended, and the Older Workers Benefit Protection Act.
(b) Exceptions to Executive Release. Notwithstanding any other provision of this
Separation Agreement to the contrary, the release by the Executive does not: (i) limit in any way
the Executive’s rights under this Separation Agreement and under the Surviving Employment Agreement
Provisions, (ii) release any rights under applicable law which cannot be waived or released
pursuant to any agreement, (iii) release any rights Executive may have to indemnification under the
bylaws or governing documents of the Company or any of its subsidiaries or under applicable law, or
(iv) release any rights Executive may have as a direct insured under the Company’s directors’ and
officers’ liability insurance policies.
(c) Current or Pending Claims of any Kind and No Relief for Released Claims. Executive
and Releasors have not and as of the date of this Separation Agreement will not have filed any
civil action, suit, arbitration, administrative charge or legal proceeding against any Releasee,
nor has the Executive or any Releasor assigned, pledged or hypothecated any claim as of the
Separation Date to any person and no other person has any interest in the claims that Executive or
any Releasor is releasing herein. Executive agrees that should any person or entity file or cause
to be filed any civil action, suit, arbitration or other legal proceedings seeking equitable or
monetary relief concerning any claim released by Executive, neither Executive nor any Releasor will
seek or accept any personal relief from or as the result of any action, suit or arbitration or
other legal proceeding.
(d) Effect of Executive Release and Waiver. Executive understands and intends that
this Section 6 constitutes a general release of all claims except as otherwise provided in Section
6(b), above, and that no reference therein to a specific form of claim, statute or type of relief
is intended to limit the scope of such general release and waiver.
(e) Executive Waiver of Unknown Claims. Executive or any Releasor may hereafter
discover claims or facts in addition to or different than those which he now knows or believes to
exist with respect to the subject matter of this Separation Agreement and which, if known or
suspected at the time of entering into this Separation Agreement, may have materially affected this
Separation Agreement and his decision to enter into it; nevertheless, Executive hereby waives any
right, claim or cause of action that might arise as a result of such different or additional claims
or facts.
(f) ADEA Release. Executive agrees and expressly acknowledges that this Separation
Agreement includes a waiver and release of all claims which Executive has or may have under the Age
Discrimination in Employment Act of 1967, as amended, 29 U.S.C. § 621, et seq.
(“ADEA”). The following terms and conditions apply to and are part of the waiver and release of
ADEA claims under this Separation Agreement:
(i) The waiver and release of claims under the ADEA contained in this Agreement do not cover
rights or claims that may arise after the date on which Executive executes and delivers this
Separation Agreement to the Company.
(ii) This Separation Agreement involves consideration in addition to anything of value to
which Executive is already entitled.
(iii) Executive is advised to consult an attorney before signing this Separation Agreement.
If Executive executes this Separation Agreement prior to the expiration of the period specified in
Section 6(f)(iv) below, Executive does so voluntarily and after having had the opportunity to
consult with an attorney.
(iv) Executive is granted twenty-one (21) days after Executive is presented with this
Agreement to decide whether or not to sign this Separation Agreement.
(v) Executive will have the right to revoke the waiver and release of claims under the ADEA
within seven (7) days after the Separation Date and Executive has reaffirmed this Agreement. This
Section 6(f) shall not become effective or enforceable until that revocation period has expired.
Executive understands and agrees that Executive shall refund any consideration that has been
previously paid to Executive, and shall receive no further consideration, if Executive revokes the
waiver and release of ADEA claims.
7. Company Release and Waiver. The Company, on its behalf, and on behalf of all of
its subsidiaries and its and their successors and assigns (“Company Parties”), intending to be
legally bound, to the maximum extent permitted by law, hereby fully and forever releases, acquits,
and discharges Executive, his heirs, executives, administrators, personal representatives,
attorneys, agents, successors and permitted assigns, from any and all liabilities, obligations,
judgments, orders, debts, liens, contracts, agreements, covenants and causes of action of every
kind and nature, whether known or unknown, suspected or unsuspected, concealed or hidden, vested or
contingent, in law or equity, existing by statute, common law, contract or otherwise, which have
existed, may exist or do exist, up to and including the execution and delivery by Executive of this
Separation Agreement, including, without limitation, any of the foregoing arising out of or in any
way related to or based upon all causes of action, suits, debts, claims and demands whatsoever in
law or in equity, which the Company ever had, now has, or hereafter may have, by reason of any
matter, cause or thing whatsoever up to and including the execution and delivery by Executive of
this Separation Agreement, and particularly, but without limitation of the foregoing general terms,
any claims arising from or relating in any way to Executive’s relationship with Company or its
subsidiaries as an employee or director, the terms and conditions of that relationship, the
termination of that relationship, and any claim that the Executive violated any provision of the
Employment Agreement, including, but not limited to, any claims under
any federal, state or local common law, statutory, or regulatory provision, now or hereafter
recognized. This release is effective without regard to the legal nature of the claims raised and
without regard to whether any such claims are based upon tort, equity, implied or express contract
or discrimination of any sort.
(a) Scope of Company Release. The Company expressly waives all rights afforded by any
statute which limits the effect of a release with respect to unknown claims. The Company
understands the significance of its release of unknown claims and its waiver of statutory
protection against a release of unknown claims.
(b) Exceptions to Company Release. Notwithstanding any other provision of this
Separation Agreement to the contrary, the release by the Company does not: (i) limit in any way the
Company’s rights under this Separation Agreement and under the Surviving Employment Agreement
Provisions, (ii) release any claim based on any other act or omission for which the Company would
not have the power to indemnify Executive pursuant to Section 145 of the Delaware General Corporate
Law, (iii) release any claim based on any rights under applicable law which cannot be waived or
released pursuant to any agreement, or (iv) release any claim to any short-swing trading profits
earned by him in violation of the provisions of Section 16(b) of the Securities Exchange Act of
1934, as amended.
(c) Current or Pending Claims of any Kind and No Relief for Released Claims. The
Company and the other Company Parties have not and as of the date of this Separation Agreement will
not have filed any civil action, suit, arbitration, administrative charge or legal proceeding
against the Executive, nor have the Company or any of the other Company Parties assigned, pledged
or hypothecated any claim as of the Separation Date to any person and no other person has any
interest in the claims that the Company and the other Company Parties are releasing herein. The
Company and the other Company Parties agree that should any person or entity file or cause to be
filed any civil action, suit, arbitration or other legal proceedings seeking equitable or monetary
relief concerning any claim released by the Company and the other Company Parties, the Company and
the other Company Parties will not seek or accept any personal relief from or as the result of any
action, suit or arbitration or other legal proceeding.
(d) Effect of the Company’s Release and Waiver. The Company and the other Company
Parties understand and intend that this Section 6 constitutes a general release of all claims
except as otherwise provided in Section 6(b), above, and that no reference therein to a specific
form of claim, statute or type of relief is intended to limit the scope of such general release and
waiver.
(e) The Company’s Waiver of Unknown Claims. The Company and the other Company Parties
may hereafter discover claims or facts in addition to or different than those which they now know
or believe to exist with respect to the subject matter of this Separation Agreement and which, if
known or suspected at the time of entering into this Separation Agreement, may have materially
affected this Separation Agreement and their decision to enter into it; nevertheless, the Company
and the other Company Parties hereby waive any right, claim or cause of action that might arise as
a result of such different or additional claims or facts.
8. Return of Corporate Property. Executive hereby covenants and agrees to immediately
return all Company files, records and other property in Executive’s possession, including such
Company property located at Executive’s home in Las Vegas, Nevada.
9. Non-Disparagement.
(a) Executive agrees that from and after the Separation Date, he will not disparage (or induce
or encourage others to disparage) the Company, any of its affiliates or any of its or their
officers, directors, executives, employees or stockholders. As used herein, the term “disparage,”
includes, without limitation, comments or statement to the press, any of the Company’s or its
affiliates’ officers, directors, executives, employees or stockholders or any person with whom the
Company or any of its affiliate has a business relationship which is designed to or would
reasonably be expected to adversely affect in any manner, the conduct of any of the Company’s or
any of its affiliates’ business or the business or personal reputations of the Company, its
affiliates or any of the Company’s or its affiliates’ officers, directors, executives, employees or
shareholders.
(b) The Company shall not permit the Designated Company Executives to disparage (or
induce or encourage others to disparage) Executive. As used herein, the term “disparage,”
includes, without limitation, comments or statement to the press, any of the Company’s or its
affiliates’ officers, directors, executives, employees, or stockholders or any person known to the
Company to have a business relationship with Executive which is designed to or would reasonably be
expected to adversely affect in any manner the conduct of Executive’s business or the personal
reputation of Executive.
10. Remedies.
(a) The Parties hereby acknowledge and affirm that in the event of any breach by Executive or
the Company of any of the covenants, agreements, and obligations hereunder, monetary damages would
be inadequate to compensate the Parties. Accordingly, in addition to other remedies which may be
available to the Parties hereunder or otherwise at law or in equity, the Parties shall be entitled
to specifically enforce such covenants, obligations and restrictions through injunctive and/or
equitable relief, in each case without the posting of any bond or other security with respect
thereto. Should any provision hereof be adjudged to any extent invalid by any court or tribunal of
competent jurisdiction, each provision shall be deemed modified to the minimum extent necessary to
render it enforceable.
(b) Executive hereby acknowledges and affirms that, in the event of a breach by Executive of
any of Executive’s covenants, agreements, and obligations under this Agreement, in addition to any
other remedies which may be available to the Company hereunder or otherwise at law or in equity,
the Company shall have the right to terminate any payments due hereunder and to recover of any
payments previously made and rights previously granted hereunder.
11. Acknowledgment of Voluntary Agreement. Executive acknowledges that he has entered
into this Separation Agreement freely and without coercion, that he
has been advised by the Company to consult with counsel of his choice, that he has had adequate opportunity
to so consult, and that he has been given all time periods required by law to consider this
Separation Agreement, including but not limited to the 21-day period required by the ADEA.
12. Complete Agreement; Inconsistencies. This Separation Agreement, including the
Surviving Employment Agreement Provisions and any other documents referenced herein, constitute the
complete and entire agreement and understanding of the Parties with respect to the subject matter
hereof, and supersedes in its entirety any and all prior understandings, commitments, obligations
and/or agreements, whether written or oral, with respect thereto; it being understood and agreed
that this Separation Agreement and including the mutual covenants, agreements, acknowledgments and
affirmations contained herein, is intended to constitute a complete settlement and resolution of
all matters set forth in Sections 6 and 7 hereof.
13. 409A Additional Tax. In the event that any compensation with respect to the
Executive’s termination is “deferred compensation” within the meaning of Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”) and the regulations thereunder (“Section
409A”), payment of such compensation shall be delayed as required by Section 409A. Such delay
shall last six months from the Separation Date, except in the event of the Executive’s death.
Within 30 days following the end of such six-month period, or, if earlier, the Executive’s death,
the Company will make a catch-up payment to the Executive equal to the total amount of such
payments that would have been made during the six-month period but for this Section 13. Wherever
payments under this Agreement are to be made in installments, each such installment shall be deemed
to be a separate payment for purposes of Section 409A.
14. Arbitration. Except for a claim for injunctive relief, any controversy, dispute,
or claim between the Parties arising out of this Separation Agreement shall be settled exclusively
by arbitration pursuant to the provisions of Article 8 of the Employment Agreement, and such
provision is incorporated herein by this reference.
15. Governing Law. All issues and questions concerning the construction, validity,
enforcement and interpretation of this Separation Agreement shall be governed by, and construed in
accordance with, the laws of the State of Nevada, without giving effect to any choice of law or
conflict of law rules or provisions that would cause the application hereto of the laws of any
jurisdiction other than the State of Nevada. In furtherance of the foregoing, the internal law of
the State of Nevada shall control the interpretation and construction of this Separation Agreement,
even though under any other jurisdiction’s choice of law or conflict of law analysis the
substantive law of some other jurisdiction may ordinarily apply.
16. Notices. All notices, requests, demands and other communications to be given
under this Agreement shall be in writing and shall be deemed to have been duly given on the date of
service, if personally served on the party to whom notice is to be given, or 48 hours after
mailing, if mailed to the party to whom notice is to be given by certified or registered mail,
return receipt requested, postage prepaid, and properly addressed to
the party at his address set forth as follows or any other address that any party may designate by
written notice to the other parties:
| To Executive: | Xxxxxxx X. Xxxx | |||
| 0000 X. Xxxxxxxxxx Xxxx., # 0-000 | ||||
| Xxx Xxxxx, XX 00000 | ||||
| To the Company: | Pinnacle Entertainment, Inc. | |||
| 0000 Xxxxxxx Xxxxx Xxxxxx | ||||
| Xxx Xxxxx, XX 00000 | ||||
| Attn: General Counsel | ||||
| Telephone: 000 000-0000 | ||||
| Facsimile: 000 000-0000 |
17. Severability. The invalidity or unenforceability of any provision of this
Separation Agreement shall not affect the validity or enforceability of any other provision of this
Separation Agreement, which shall otherwise remain in full force and effect.
18. Counterparts. This Separation Agreement may be executed in separate counterparts,
each of which shall be deemed to be an original and all of which taken together shall constitute
one and the same agreement.
19. Successors and Assigns. The Parties’ obligations hereunder shall be binding upon
their successors and permitted assigns. The Parties’ rights and the rights of the other Releasees
shall inure to the benefit of, and be enforceable by, any of the Parties’ and Releasees’ respective
successors and permitted assigns. Executive may not assign any of his rights and obligations under
this Separation Agreement, except as may be agreed to in writing by the Company. The Company may
assign all rights and obligations of this Separation Agreement to any successor in interest to the
assets of the Company. In the event that the Company is dissolved, all obligations of the Company
under this Agreement shall be provided for in accordance with applicable law.
20. Amendments, Waivers and Delay. The failure or delay on the part of the Company, or
Executive to exercise any right or remedy, power or privilege hereunder shall not operate as a
waiver thereof. No amendment to or waiver of this Separation Agreement or any of its terms shall
be binding upon any Party unless consented to in writing by such Party.
21. Headings. The headings of the sections and subsections hereof are for purposes of
convenience only, and shall not be deemed to amend, modify, expand, limit or in any way affect the
meaning of any of the provisions hereof.
22. Construction. All terms and definitions contained herein shall be construed in
such a manner that shall give effect to the fullest extent possible
to the express or implied intent of the parties hereby.
23. Attorneys’ Fees. In the event a Party commences an action to enforce the terms of
this Separation Agreement, or for damages for a breach arising out of or relating to this
Separation Agreement, the prevailing Party shall be entitled to an award of reasonable attorneys’
fees.
24. Counsel. Executive has been advised by the Company that he should consider
seeking the advice of counsel in connection with the execution of this Agreement and Executive has
had an opportunity to do so. Executive has read and understands this Agreement, and has sought the
advice of counsel to the extent he has determined appropriate. The Company shall reimburse
Executive for the reasonable fees and expenses of Executive’s counsel in connection with this
Agreement.
25. Community Property. Without prejudice to the actual rights of the spouses as
between each other, for all purposes of this Separation Agreement, the Executive shall be treated
as agent and attorney-in-fact for that interest held or claimed by his spouse with respect to this
Agreement. This appointment is coupled with an interest and is irrevocable.
IN WITNESS WHEREOF, the Parties have executed this Separation Agreement effective as of the
date of the first signature affixed below or as otherwise provided in this Separation Agreement.
DATED: Xxxxx 0, 0000
| XXXXXXXX ENTERTAINMENT, INC. |
||||
| By: | /s/ Xxxxxxx Xxxxxxxxxx | |||
| Xxxxxxx Xxxxxxxxxx | ||||
| President & Chief Executive Officer | ||||
READ CAREFULLY BEFORE SIGNING
I have read this Separation Agreement and have had the opportunity to consult legal counsel and my
own tax advisors prior to my signing of this Separation Agreement. I understand that by executing
this Separation Agreement, I will relinquish any right or demand I may have against the Releasees
or any of them, unless otherwise provided in this Separation Agreement and/or the surviving terms
of my Employment Agreement.
DATED: March 3, 2011
| By: | /s/ Xxxxxxx X. Xxxx | |||
| XXXXXXX X. XXXX | ||||
SPOUSAL CONSENT
By her signature below, the spouse of Xxxxxxx X. Xxxx agrees to be bound by all of the items
and conditions of the foregoing Separation Agreement and General Release (including those relating
to the appointment of Xxxxxxx X. Xxxx as her attorney-in-fact).
DATED: March 3, 2011
| By: | /s/ Xxxxxxxx X. Xxxx | |||
| XXXXXXXX X. XXXX | ||||
