EXHIBIT (10)(d)(1)
NONQUALIFIED STOCK OPTION AGREEMENT
PURSUANT TO THE
XXXXXXX GAMING & ENTERTAINMENT, INC.
1994 STOCK OPTION PLAN
THIS STOCK OPTION AGREEMENT (this "Agreement") is made as of
June 30, 1995 between Xxxxxxx Gaming & Entertainment, Inc., a
Delaware corporation (the "Company"), and Xxxxxx X. Xxxxxxxxx
(the "Executive").
R E C I T A L S
A. The Company has adopted the 1994 Stock Option Plan (the
"Plan"), a copy of which is annexed hereto as Exhibit 1.
B. T h e Company desires to grant the Executive the
opportunity to acquire a proprietary interest in the Company in
consideration of the Executive's contribution to the success and
progress of the Company.
C. In accordance with the Plan, the Committee (as defined
in the Plan) has as of March 27, 1995 (subject to shareholder
approval which approval was given on June 27, 1995) granted to
the Executive an option (the "Option") to purchase shares of
common stock, par value $.01 per share, of the Company (the
"Shares"), subject to the terms and conditions of the Plan and
this Agreement.
AGREEMENTS
1. Definitions. Capitalized terms not defined herein
shall have the meanings set forth in the Plan.
2. Grant of Option. The Company grants to the Executive
the right and option to purchase all or any part of an aggregate
of 100,000 Shares (the "Option Shares"), at the purchase price
of $10.46875 per share, on the terms and conditions set forth
herein. This Option is not intended to qualify for treatment as
an Incentive Stock Option within the meaning of Section 422A of
the Internal Revenue Code of 1986, as amended (the "Code").
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3. Exercisability. The Option shall become exercisable to
the extent of one-fourth of the number of Option Shares on
September 27, 1995, one-fourth on August 1, 1996, one-fourth on
August 1, 1997 and one-fourth on August 1, 1998, on a cumulative
basis. In the event of (1) the termination of the Executive's
directorship due to death, disability or retirement, (2) there is
a Change of Control (as defined in Section 12 below), (3) the
Executive ceases to serve as a Director of the Company for any
reason other than a voluntary resignation by the Executive or
termination for cause by the Company, all of the Executive's
options become exercisable. During the period the Option is
exercisable, it may be exercised by the Executive as to the whole
or any part thereof at any time or from time to time.
4. Expiration. The Option shall expire upon the earliest
to occur of:
(a) the tenth anniversary of the Effective Date;
(b) in the event the Executive ceases to be a member
of the Board of Directors of the Company, other than due to
circumstances described in paragraph (c) or (d), three months
after the Executive ceases to be a Director.
(c) the termination of the Executive's directorship
with the Company if such termination is a termination by the
Company for cause, in which case all rights of the Executive
under this Agreement shall be immediately forfeited, except as to
Option Shares already purchased;
(d) the first anniversary of the termination of the
Executive's directorship if the termination is by reason of death
or disability.
For purposes of this Section 4, during the period, if
any, following a termination of the Executive's directorship and
prior to the expiration of the Option, the Option shall be
exercisable only to the extent exercisable on the date of such
termination.
5. Assignment or Transfer. The Option shall not be
assignable or transferable by the Executive other than by will or
by the laws of descent and distribution, or pursuant to a
qualified domestic relations order as defined in the Code.
During the lifetime of an optionee, the Option shall be
exercisable only by the optionee or the optionee's guardian or
legal representative.
6. Adjustments. If the Company's outstanding Shares are
increased or decreased or changed into or exchanged for a
different number or kind of shares of stock or other securities
o f the Company or another corporation by reason of any
consolidation, merger, combination, liquidation, reorganization,
recapitalization,
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stock dividend, stock split, split-up, split-off, spin-off,
combination of shares, exchange of shares or other like change in
capital structure of the Company, the number of kind of shares or
interests subject to this Option and the per share price thereof
shall be appropriately adjusted at the time of such event. Any
fractional shares or interests resulting from such adjustment
shall be eliminated.
7. Exercise of the Option. A person electing to exercise
this Option shall deliver to the Secretary of the Company a
written and signed notice of such election and of the number of
Shares such person has elected to purchase and shall at the time
of delivery of such notice pay for the full purchase price of the
Shares such person has elected to purchase in United States
dollars by personal check, bank draft or money order drawn to the
order of the Company (and, in any event, in an amount not less
than the aggregate par value of such Shares). The Committee
further may, in its discretion, permit payment of the purchase
price in such form or in such manner as may be permissible under
the Plan and under any applicable law.
8. Compliance with Legal Requirements. No Shares shall be
issued or transferred pursuant to this Agreement unless and until
all legal requirements applicable to such issuance or transfer
have, in the opinion of counsel of the Company, been satisfied.
Such requirements may include, but are not limited to, listing,
registering or qualifying the Shares subject to the Option upon
any securities exchange or under any state or federal law,
satisfying any applicable law relating to the transfer of
unregistered securities or demonstrating the availability of an
exemption from applicable laws, placing a legend on the shares to
the effect that they were issued in reliance upon an exemption
from registration under the Securities Act of 1933 (the "Act")
and may not transferred other than in reliance upon Rule 144
promulgated under the Act, if available, or upon another
exemption from the Act, or obtaining the consent or approval of
any governmental regulatory body. The Company has filed a
registration statement on Form S-8 under the Act in order to
register Shares subject to the Plan.
In connection with any such issuance or transfer, or
registration, the person acquiring Shares shall, if requested by
the Company, provide information and assurances satisfactory to
counsel to the Company with respect to such matters as the
Company may deem desirable to assure compliance with all
applicable legal requirements.
9. No Interest in Shares Subject to Option. Neither the
Executive (individually or as a member of a group) nor any
beneficiary or other person claiming under or through the
Executive shall have any right, title, interest, or privilege in
or to any Shares allocated or reserved for the purpose of the
Plan or subject to this Agreement except as to such Shares, if
any, as shall have
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been issued to such person upon exercise of this Option or any
part of it.
10. Plan Controls. The Option hereby granted is subject
to, and the Company and Executive agree to be bound by, all of
the terms and conditions of the Plan, as the same may be amended
from time to time in accordance with the terms thereof, but no
such amendment shall be effective as to the Option without the
Executive's consent insofar as it may adversely affect the
Executive's rights under this Agreement. The Committee shall
h a ve sole discretion to determine whether the events or
conditions described in this Agreement have been satisfied and to
make all other interpretations, constructions and determinations
required under this Agreement (except those which the Executive
is expressly permitted to make), and all such determinations by
the Committee shall be conclusive.
11. Not an Employment Contract. Nothing in the Plan, in
this Agreement or any other instrument executed pursuant thereto
shall confer upon the Executive any right to continue in the
employ of the Company or shall affect the right of the Company to
terminate the employment of the Executive with or without cause.
12. Change of Control. For the purposes of this
Agreement, "Change of Control" shall mean the occurrence of any
one of the following events:
(i) any "person", as such term is used in Sections
3(a)(9) and 13(d) of the Securities Exchange Act of 1934, other
than Mr. Xxxx Xxxxxxx and his affiliates becomes a "beneficial
owner", as such term is used in Rule 13d-3 promulgated under that
Act, of 50% or more of the Company's Voting Stock, provided that
the foregoing reference to 50% shall become 35% whenever Mr. Xxxx
Xxxxxxx disposes of all or substantially all of the Company's
Voting Stock presently held by Xx. Xxxxxxx;
(ii) the Company adopts any plan of liquidation
providing for the distribution of all or substantially all of its
assets;
(iii) all or substantially all of the business of the
Company is disposed of pursuant to a merger, consolidation or
other transaction (unless the shareholders of the Company
i m mediately prior to such merger, consolidation or other
t r a nsaction beneficially own, directly or indirectly, in
substantially the same proportion as they owned the Voting Stock
of the Company, all of the Voting Stock or other ownership
interests of the entity or entities, if any, that succeed to the
business of the Company);
(iv) the Company combines with another company and is
the surviving corporation but, immediately after the combination,
the shareholders of the Company immediately prior to the
combination hold, directly or indirectly, 50% or less of the
Voting Stock of
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the combined company (there being excluded from the number of
shares held by such shareholders, but not from the Voting Stock
of the combined company, any shares received by "affiliates", as
such term is defined in the rules of the Securities and Exchange
Commission, of such other company in exchange for stock of such
other company); or
(v) Xxxx Xxxxxxx is no longer Chairman of the Board of
Directors of the Company.
For the purposes of this Section 12, "Voting Stock"
shall mean capital stock of any class or classes having general
voting power under ordinary circumstances (not including the
Class B stock of the Company), in the absence of contingencies,
to elect the directors of a corporation.
13. Governing Law. All rights under this Agreement shall
be governed by and construed in accordance with the laws of the
State of Delaware.
14. Taxes. The Committee may, in its discretion, make such
provisions and take such steps as it may deem necessary or
appropriate for the withholding of all federal, state, local and
other taxes required by law to be withheld with respect to the
issuance or exercise of the Option, including, but not limited
to, deducting the amount of any such withholding taxes from any
other amount then or thereafter payable to the Executive, or
requiring the Executive to pay to the Company the amount required
to be withheld or to execute such documents as the Committee
deems necessary or desirable to enable it to satisfy its
withholding obligations.
15. Notices. All notices, requests, demands and other
communications pursuant to this Agreement shall be in writing and
shall be deemed to have been duly given if personally delivered,
telexed or telecopied to, or, if mailed, when received by, the
other party at the following addresses (or at such other address
as shall be given in writing by either party to the other):
If to the Company, to:
Xxxxxxx Gaming & Entertainment, Inc.
0000 Xxxxxxxxx
Xxxxxxxx Xxxx, XX 00000
Attention: The Secretary
If to the Executive, to the address set
forth next to his signature hereto.
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16. Effective Date. By execution below, this Agreement is
entered into as of March 27, 1995.
XXXXXXX GAMING & ENTERTAINMENT, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
Its:
Executive Vice President -
Finance and
Chief Financial Officer
Address for Notices: AGREED TO AND ACCEPTED:
By: /s/ Xxxxxx X. Xxxxxxxxx
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