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ALLIANCE GAMING CORPORATION
FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 1996
EXHIBIT 10.72
EMPLOYMENT AGREEMENT SUPPLEMENT
THIS AGREEMENT (the "Agreement") is made and entered into as
of the 29th day of August 1996 (the "Effective Date") by and between ALLIANCE
GAMING CORPORATION, a Nevada corporation (the "Company"), and XXXX XXXXXXXXXX
(the "Grantee").
R E C I T A L S :
1. On September 23, 1991, the Board of Directors of
Company (the "Board") adopted the United Gaming, Inc. 1991 Long-Term Incentive
Plan (the "1991 Plan"). On January , 1997, the Board adopted the Alliance Gaming
Corporation 1996 Long-Term Incentive Plan (the "1996 Plan"; together with the
1991 Plan, the "Plans"). The Board shall present the 1996 Plan to the
stockholders of the Company for their approval at the next regularly-scheduled
annual meeting of stockholders of the Company after the date hereof, together
with the Board's and the Company's management's recommendation that the
stockholders of the Company approve the 1996 Plan.
2. The Company and the Grantee are parties to an
Agreement dated March 20, 1995 (the "Original Agreement") pursuant to which the
Company has engaged the Grantee as a director and to provide certain services to
the Company in consideration of the compensation provided for therein. In
connection with the Original Agreement, the Company has granted to the Grantee
(i) the option to acquire up to 374,000 shares of its Common Stock, par value
$.10 per share (the "Common Stock"), under the 1991 Plan (the "1991 Options"),
and (ii) the option to acquire up to 176,000 shares of Common Stock under the
1996 Plan (the "1996 Options"; together with the 1991 Options, the "Options"),
pursuant to the Option Agreements in the forms attached hereto as Exhibits 1 and
2, respectively (such agreements, the "1991 Option Agreement" and the "1996
Option Agreement", respectively"). A true and correct copy of the 1991 Plan is
attached as Exhibit A to the 1991 Option Agreement and a true and correct copy
of the 1996 Plan is attached as Exhibit A to the 1996 Option Agreement.
3. The Board hereby confirms that the Grantee shall be
considered, for all purposes relating to the Plans and the option grants
thereunder, a "regular full-time employee" of the Company; however, if, for any
reason whatsoever, the Grantee is not deemed to be a "regular full-time
employee" under the Plans, then, in such event, the Board conclusively
designates the Grantee to be a "paid consultant" under the Plans.
A G R E E M E N T :
NOW, THEREFORE, the parties hereto agree as follows:
1. Certain Covenants. The Company agrees to the
covenants and undertakings set froth in the Recitals above. In the event that
the 1996 Plan is approved by the stockholders of the Company as described above,
or is otherwise approved in a timely manner to permit or confirm the grant of
the 1996 Options in accordance with applicable law, the 1996 Options shall be
treated as Incentive Stock Options under Section 422 of the Code to the maximum
extent permitted by applicable law, and the portion of the 1996 Options, if any,
that does not qualify as Incentive Stock Options shall be treated as
Nonstatutory Stock Options under the 1996 Plan.
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ALLIANCE GAMING CORPORATION
FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 1996
2. Certain Supplement to the Original Agreement. The
Original Agreement is supplemented as follows: The parties acknowledge that the
Company has agreed to pay to the Grantee a bonus (the "Contingent Bonus") under
Section 4(b) of the Original Agreement in the aggregate amount of $300,000. The
Contingent Bonus or portions thereof (as set forth below) shall be paid by the
Company to the Grantee within five business days of the attainment of each of
the following goals whenever such goals are attained at any point in the future;
it being understood that payment in respect of attainment of one or more such
goals shall not be conditioned upon attainment of any other goal:
1. the date of the completion of the existing assignment to
engage a replacement chief executive officer of the Company, i.e., the
date of commencement of employment of such person: 1/3 of such amount
(i.e., $100,000);
2. the date upon which the average closing price of a share of
the Common Stock, on its principal exchange or listing agency, for any
five consecutive day period shall have equaled or exceeded $5.00: 1/3
of such amount (i.e., $100,000);
3. the date upon which a new or revised bank credit agreement or
senior lending facility in an amount equal to or greater than
$10,000,000 is entered into by the Company and/or any of its direct or
indirect subsidiaries: 1/6 of such amount (i.e., $50,000); and
4. the date upon which equity analysts who are employed by any
four brokerage, investment banking, commercial banking or similar firm
shall have initiated coverage of the Company's equity securities: 1/6
of such amount ($50,000).
The attainment of one or more of such goals and the payment of
any portion of the Contingent Bonus shall in no way affect the determination by
the Company or the Board of the appropriate bonus for the Grantee for the fiscal
year ended June 30, 1997 or any subsequent fiscal year of the Company.
1. Notices. All notices, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if delivered in person, by facsimile transmission, by reputable
overnight courier, such as Federal Express, or otherwise actually delivered, in
the case of the Grantee, to the last address of the Grantee appearing on the
books of the Company (with a copy to 00 Xxxxx Xxxxx, Xxxxxxxx, Xxx Xxxx 00000),
and, in the case of the Company, to:
Alliance Gaming Corporation
0000 Xxxxx Xxxxxxx Xxxx
Xxx Xxxxx, Xxxxxx 00000
Attention: General Counsel
or to such other address or addresses as the Grantee or the Company shall
hereafter have specified in writing. Any such notice, demand or other
communication hereunder shall be deemed to have been duly given on the date
actually delivered.
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ALLIANCE GAMING CORPORATION
FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 1996
1. Modification of Agreement; Etc. This Agreement may
be modified, amended, suspended or terminated, and any terms, covenants,
representations or conditions may be waived, but only by a written instrument
executed by each of the parties hereto. This Agreement shall not be transferred
or assigned by either party hereto without the prior written consent of the
other party; provided that (a) this Agreement shall be binding upon any
successor to the Company (by merger or otherwise) or any successor to all or
substantially all of the Company's business or assets and (b) the benefits
afforded hereby to the Grantee shall be available to the Grantee's estate (or
his heirs or legal representatives), to the same extent available to the Grantee
hereunder, in the event of the Grantee's death during the duration of the this
Agreement.
2. Severability. Should any provision of this
Agreement be held by a court to be unenforceable or invalid for any reason
whatsoever, the remaining provisions of this Agreement shall not be affected by
such holding and shall continue in full force in accordance with their terms.
3. Governing Law. This Agreement has been executed in
the State of Nevada and all matters pertinent thereto shall be governed by the
laws of the State of Nevada.
4. Arbitration. Any controversy between the parties
hereto, including the construction or application of any of the terms, covenants
or conditions of this Agreement, shall on written request of one party served on
the other be settled exclusively by arbitration in accordance with the rules of
the American Arbitration Association then in effect. Such arbitration shall be
conducted, at the option of the initiating party, in Las Vegas, Nevada or New
York, New York. The cost of such arbitration shall be borne by the losing party
or in such proportions as the arbitrator(s) shall decide. Judgment may be
entered on the arbitrator's award in any court of competent jurisdiction.
5. Counterparts. This Agreement may be executed in one
or more counterparts and, when such counterparts have been executed by each of
the parties hereto, said counterparts shall constitute a single and valid
agreement although each of the signatory parties have executed separate
counterparts hereof.
6. Titles. Titles are provided herein for convenience
only and are not to serve as a basis for interpretation or construction of this
Agreement.
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ALLIANCE GAMING CORPORATION
FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 1996
IN WITNESS WHEREOF, this Agreement has been executed as of the
date first above written.
Alliance Gaming Corporation
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
Title: Senior Vice-President,
Secretary, and General Counsel
/s/ Xxxx Xxxxxxxxxx
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Xxxx Xxxxxxxxxx
