Exhibit 99.4
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (the "Agreement") entered into May 17,
2004 between CAESARS ENTERTAINMENT, INC. ("Employer" or the "Company") and
XXXXXX X. XXXXXXX ("Executive").
In consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are mutually acknowledged, the parties hereto agree as
follows:
1. Employment
A. The employment agreement between the parties dated January 1, 2002
shall terminate as of the date hereof, and shall be of no further force and
effect.
B. Employer hereby employs Executive as Senior Vice President and
Controller, and in such other capacities and with such other responsibilities
as Employer shall determine, and Executive hereby accepts such employment upon
the terms and conditions hereafter set forth.
C. During the term of his employment, Executive shall devote his best
efforts to his employment and shall perform such duties consistent with his
position and in time assigned or delegated to him by Employer. Executive will
devote his entire working time and attention to the business and related
interests of Employer except as otherwise agreed to by Employer pursuant to
Paragraph lD hereof. Furthermore, Executive agrees Employer may direct him to
perform some or all of his duties hereunder for the benefit of Employer or any
of its subsidiaries, affiliates, successors or assigns in Xxxxx County, Nevada
(collectively "CEI"). Such an event shall not be deemed a breach of this
Agreement provided Employer and/or CEI continue to honor all obligations to
Executive hereunder without any reduction in compensation.
D. Executive shall not, without prior written consent of Employer,
directly or indirectly, during the term of this Agreement:
(1) Other than in the performance of duties naturally inherent
in Employer's business and related interests, and in furtherance thereof as
otherwise provided in this Agreement, render service of a business,
professional or commercial nature to any other person or firm, whether for
compensation or otherwise, but this prohibition shall not be construed to
prevent the Executive from investing his assets in such form or manner as will
not require any services on the part of the Executive in the operation of the
affairs of the companies in which such investments are made and which are not
in violation of subparagraph (2) below;
(2) Engage in any activity competitive with or adverse to
Employer's business or related interests, whether alone, as a partner, or as an
officer, director, employee or shareholder of any other corporation, or
otherwise, directly or indirectly except that the ownership of not more than
one percent (1%) of the stock of any publicly-traded corporation shall not be
deemed violative of this subparagraph (2);
(3) Be engaged by or hold any interest in any entity which
conducts business with or acts as consultant or advisor to Employer, whether
alone, as a partner, or as an officer, director, employee or shareholder, or
otherwise, directly or indirectly, except that ownership of not more than one
percent (1%) of the stock of any publicly-traded corporation shall not be
deemed violative of this subparagraph (3).
2. Term
Subject to the provisions for termination hereinafter provided, the
term of this Agreement shall commence on May 17, 2004 and ending on December
31, 2007 (the "Term"). At the end of the Term, in the absence of new written
employment agreement between Employer and Executive, such employment will be
at-will at Executive's then-current Base Salary.
3. Compensation
A. For all services to be rendered by Executive pursuant to this
Agreement, Executive shall receive from Employer a salary at the annual rate of
$270,000, to be paid in equal installments at such payment intervals as are the
usual custom of Employer, but not less often than semi-monthly (the "Base
Salary"). Executive acknowledges ten percent (10%) of the Base Salary is being
paid in consideration for the covenants contained in Paragraph 5 hereof. The
Base Salary shall be subject to annual review by Employer based upon Employer's
review policy, although any determination to increase the Base Salary shall be
within Employer's sole discretion.
B. It is further understood by Executive and Employer that Executive
shall be eligible to participate in Employer's bonus program in effect for
executive personnel of Employer from time to time. Pursuant thereto, Executive
shall be eligible to receive a bonus in the sole discretion of Employer based
upon Executive's performance and Employer's financial results.
4. Vacation and Other Benefits
Executive shall be entitled to vacation in accordance with Employer's
policies, as well as to participate in all benefit programs in effect for
similarly situated executive personnel of Employer from time to time,
including, without limitation, deferred compensation plan, stock purchase plan,
life and health insurance. Executive shall also be entitled to reimbursement
for all reasonable expenses incurred by Executive in the performance of his
responsibilities, as well as the promotion of Employer's business. Executive
shall submit to Employer periodic statements of all expenses so incurred.
Subject to such audits as Employer may deem necessary, Employer shall reimburse
Executive promptly in the ordinary course.
5. Covenants and Confidential Information
A. Executive agrees that for the applicable period specified below, he
will not, directly or indirectly, do any of the following:
(1) Own, manage, control, or participate in the ownership,
management, or control of, or be employed or engaged by or otherwise affiliated
or associated as a consultant, independent contractor or otherwise, with any
other corporation, partnership, proprietorship, firm, association or other
business entity, or otherwise engage in any business which is competitive with
or adverse to Employer's business or related interests; provided, however, that
the ownership of not more than one percent (1%) of the stock of any publicly
traded corporation shall not be deemed a violation of this covenant;
(2) Solicit or induce any person who is an employee, officer, or
agent of Employer to terminate said relationship;
(3) Employ, assist in employing or otherwise associate in
business with any employee or officer of Employer;
(4) Disclose, divulge, discuss, copy or otherwise use or suffer
to be used in any manner, in competition with, or contrary to the interests of
Employer, the customer lists, inventions, ideas, discoveries, manufacturing
methods, product research or engineering data or other trade secrets of
Employer, it being acknowledged by Executive that all such information
regarding Employer developed, compiled or obtained by, or furnished to,
Executive while he shall have been employed by or associated with Employer is
confidential information and the exclusive property of Employer.
B. The provisions of subparagraphs 5A(1) - 5A(3) shall be
operative during the Term of the Agreement except as provided in the following
sentence. In the event Executive quits or is terminated for "cause" (as defined
in Paragraph 7 hereof), the provisions of subparagraphs 5A(l) - (3) shall be
operative for a period of one hundred eighty (180) days from the date of
termination. In the event Executive is terminated without "cause" (as provided
in Paragraph 8 hereof), the provisions of subparagraph 5A(1) shall terminate as
of the date of termination of Executive's employment and the provisions of
subparagraph 5A(2) and (3) shall be operative for a period of one hundred
eighty (180) days from the date of termination of Executive's employment. All
other obligations created by the terms of this Paragraph 5 are of a continuing
nature and shall remain in full effect at all times during and beyond
Executive's period of employment.
C. Executive expressly agrees and understands that the remedy at law
for any breach by him of this Paragraph 5 will be inadequate and that the
damages following from such breach are not readily susceptible to being
measured in monetary terms. Accordingly, it is acknowledged that Employer shall
be entitled to immediate injunctive relief and if the court so permits, may
obtain a temporary order restraining any threatened or further breach. Nothing
contained in this Paragraph 5 shall be deemed to limit Employer's remedies at
law or in equity for any breach by Executive of the provisions of this
Paragraph 5 that may be pursued or availed of by Employer. Any covenant on
Executive's part contained hereinabove which may not be specifically
enforceable shall nevertheless, if breached, give rise to a cause of action for
monetary damages.
D. Executive has carefully considered the nature and extent of the
restrictions upon him and the rights and remedies conferred upon Employer under
this Paragraph 5, and hereby acknowledges and agrees that the same are
reasonable in time and territory, are designed to eliminate competition which
otherwise would be unfair to Employer, do not stifle the inherent skill and
experience of Executive, would not operate as a bar to Executive's sole means
of support, are fully required to protect the legitimate interests of Employer
and do not confer a benefit upon Employer disproportionate to the detriment to
Executive.
E. For the purposes of this Paragraph 5, the term "Employer" shall be
deemed to include any of Employer's parents, subsidiaries, affiliates,
successors or assigns.
F. If any of the covenants contained in this Paragraph 5 are
determined by a final judgment of a court of competent jurisdiction to be
unenforceable or invalid because of the geographic scope or time duration of
such restrictions, such provisions will be deemed retroactively modified to
provide for the maximum geographic scope and time duration that would make such
provisions enforceable and valid. However, no such retroactive modification
will affect any of Employer's rights hereunder arising out of the breach of any
such covenant, including without limitation, Employer's right to terminate this
Agreement without further liability to Executive. The parties hereby authorize
a court of competent jurisdiction to reform this Agreement to give effect to
the retroactive modification provisions contained in this Xxxxxxxxx 0X.
6. Termination by Reason of Illness, Incapacity or Death
The employment of Executive under this Agreement may be terminated at
any time by:
A. Action of Employer on thirty (30) day's written notice in the event
of Executive's total disability (which shall be deemed to mean Executive's
failure to substantially discharge his duties under this Agreement for at least
six (6) consecutive months due to Executive's physical or mental illness or
disability), and upon such termination Executive shall be entitled to:
(1) his Base Salary for the thirty (30) day notice period;
(2) any bonuses awarded for prior periods, but not yet paid;
(3) long-term disability payments under Employer's long-term
disability plan or program as the same shall be in effect on the date of
termination of his employment;
(4) reimbursement in accordance with this Agreement of any
business expenses incurred by Executive, but not yet paid to him on the date of
his termination of employment; and
(5) other benefits to which he is then entitled in accordance
with applicable plans and programs of Employer.
Notwithstanding anything to the contrary contained in this
subparagraph 6A, in no event shall Executive be entitled to benefits upon a
termination of employment pursuant to this subparagraph 6A, that are greater
than the employment benefits given to executives of Employer of comparable
status at the time of such termination.
B. Executive's death, in which case, all obligations of Employer under
this Agreement shall terminate other than the payment of that portion of his
Base Salary on a pro-rata basis accrued to the date of death, plus
reimbursement of all expenses reasonably incurred by Executive in performing
his responsibilities and duties for Employer prior to and including such date
and the payment of applicable insurance proceeds.
7. Termination for Cause
A. The employment of Executive under this Agreement, and the term
hereof, may be terminated by Employer for cause at any time, in which event,
Employer shall have no further liability to Executive hereunder except for the
payment of any accrued but unpaid portion of Base Salary through the date of
termination and any other monies Executive is legally entitled to as a matter
of right under Employer's policies or benefit plans as of the date of
termination. For purposes hereof, the term "cause" includes, but is not limited
to:
(1) Executive's fraud, dishonesty, willful misconduct or gross
or persistent negligence in the performance of his duties hereunder, including
willful failure to perform such duties as may properly be assigned him
hereunder and his act of quitting or resigning his employment;
(2) Executive's material breach of any provision of this
Agreement relating to the covenants in Paragraph 5 hereof or the prohibited
activities in Paragraph 1D hereof;
(3) Executive's failure to make timely application and qualify
(or, after having so qualified, being thereafter disqualified) under any
suitability or licensing requirement to which Executive may be subject by
reason of his position with Employer and its parent, affiliates or
subsidiaries, whether under the laws of Nevada, New Jersey, or otherwise; or
(4) A termination of this Agreement by the Employer that follows
a request by Executive that he be permitted to cancel or terminate this
Agreement before the expiration of the Term.
B. If Employer believes Executive has engaged in conduct which would
be cause for termination of this Agreement, Employer may suspend Executive
until such time as Employer has made a decision whether to terminate Executive
for cause, which suspension, at Employer's election, may be without pay if it
is more than one (1) week in duration.
C. Any termination by reason of the foregoing shall not be in
limitation of any other right or remedy Employer may have under this Agreement
or otherwise.
8. Termination Without Cause
Employer shall have the right to terminate this Agreement without
cause at any time during the Term by written notice to Executive, the effective
date of which termination shall be referred to as the "Early Termination Date".
Non-renewal shall not constitute termination without cause. Except as otherwise
provided in Employer's benefit plans, by COBRA or other law, Executive's right
to participate in the benefit plans of Employer shall cease as of the Early
Termination Date. In the event Employer elects to terminate this Agreement
without cause, in addition to any monies which Executive is legally entitled to
receive as a matter of right pursuant to applicable statutory law or pursuant
to Employer's policies or benefit plans, Executive shall be entitled to receive
"Early Termination Payments" consisting of (a) the "Base Salary Payment" and
(b) the "Bonus Payment".
The Base Salary Payment shall be that amount of Executive's Base
Salary as of the Early Termination Date due for the balance of the Term or for
a period of twelve (12) months, whichever is greater, paid in accordance with
the Company's regular payroll practices or, solely within the Company's
discretion, in a lump sum. The Base Salary Payment shall be made less
applicable deductions and withholdings.
The Bonus Payment shall be equal to the amount of Executive's Base
Salary as of the Early Termination Date, multiplied by the target rate in
effect for the year of termination, paid when and in the same percentage as
that to other similarly situated employees, and further multiplied by a
fraction, the numerator of which is the number of days which have elapsed in
the calendar year during which the Early Termination Date falls, and the
denominator of which is three hundred sixty-five (365). The Bonus Payment shall
be paid to Executive at the same time paid to other employees of Employer.
Executive agrees that in the event this Agreement is terminated by
Employer without cause, the Early Termination Payment shall constitute
Executive's sole and exclusive remedy for the termination of his employment and
the termination of this Agreement. Executive acknowledges he has been advised
it is Employer's policy that payment of annual or other bonuses by Employer is
completely a matter of discretion, and Executive agrees that in the event of
his termination without cause, he has no legal right to the payment of the
Bonus Payment or any other bonus. Upon tender of the Bonus Payment by Employer,
without any further action or notice on the part of any party, Executive shall
be deemed to have released Employer, its parents, subsidiaries, affiliates,
successors and assigns, and the officers, directors, agents and employees of
each of them, from any and all claims, liabilities, judgments and expenses
(including attorney's fees) arising from Executive's employment with Employer
and the termination thereof (including, but not limited to, claims arising from
the termination of this Agreement), but not a release of any right Executive
may have to receive the unpaid portion of the Base Salary Payment.
9. Compliance Committee Approval
Executive shall cooperate with requests for information, documentation
or assurances from the Caesars Entertainment, Inc. Compliance Committee during
the term of this Agreement. In the event the Compliance Committee, in its
absolute discretion, disapproves Executive's continued employment or determines
that Executive's continued employment may adversely affect the licensing status
of Employer or any of its parents, subsidiaries, affiliates, successors and
assigns with any gaming or other regulatory agency, Employer shall have the
right to immediately terminate this Agreement without further liability to
Executive, other than for payment of any accrued but unpaid portion of Base
Salary through the date of termination.
10. Severability
The provisions of this Agreement are severable, and if any one or more
provisions shall be determined to be illegal or otherwise unenforceable, in
whole or part, the remaining provisions, and any partially unenforceable
provision to the extent enforceable in any jurisdiction, shall nevertheless be
binding and enforceable.
11. Binding Agreement and Consent to Assignment
The rights and obligations of Employer under this Agreement shall
inure to the benefit of, and shall be binding upon, Employer, and its
successors and assigns, and Executive consents to Employer's assignment of this
Agreement and Executive's obligations and covenants hereunder. The rights and
obligations of Executive under this Agreement shall inure to the benefit of
Executive, and shall be binding upon, Executive and his heirs, personal
representatives and estate.
12. Notices
Any notice to be given under this Agreement shall be personally
delivered in writing or shall have been deemed duly given when received or
within five (5) days of deposit in the United States mail, postage prepaid,
registered or certified, return receipt requested, whichever is earlier. If
mailed to Employer, it shall be addressed to such Employer at its principal
place of business, Attention: General Counsel, and if mailed to Executive, it
shall be addressed to him at his last known home address, or such other
addresses as Employer or Executive may hereafter designate in writing to the
other.
13. Waiver
The failure of any party to enforce any provisions of this Agreement
shall not in any way be construed as a waiver of any such provision or
provisions as to any future violations thereof nor prevent that party
thereafter from enforcing each and every other provision of this Agreement. The
rights granted the parties herein are cumulative, and the waiver of any single
remedy shall not constitute a waiver of such party's right to assert all other
legal remedies available to it under the circumstances.
14. Governing Law
This Agreement shall be governed by and construed and interpreted
according to the laws of the State of Nevada without reference to principles of
conflict of laws.
15. Venue
While Employer is not limited to a particular forum, Executive agrees
that Employer may bring any action in connection with this Agreement in Xxxxx
County, Nevada, and Executive submits to the jurisdiction of the state and
federal courts located in Xxxxx County, Nevada. Any action by Executive in
connection with this Agreement must be brought in Xxxxx County, Nevada.
16. Captions and Paragraph Headings
Captions and paragraph headings used herein are for convenience only
and are not a part of this Agreement and shall not be used in construing it.
17. Entire Agreement
This Agreement constitutes the entire agreement between the parties,
supersedes all prior agreements and understandings between the parties with
respect to the subject matter hereof and may not be modified or terminated
orally. No modification, termination or attempted waiver of this Agreement
shall be valid unless in writing and signed by the party against who the same
is sought to be enforced. This Agreement may be executed in multiple
counterparts, each of which shall be an original, and all of which, when taken
together, shall constitute one and the same document.
CAESARS ENTERTAINMENT, INC. ("Employer")
By: /s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx, President and Chief
Executive Officer
/s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx ("Executive")
