EXHIBIT 10.1
EMPLOYMENT AGREEMENT
THIS AGREEMENT, made as of 4th day of September, 2002, between Xxxxxx'x
Entertainment, Inc., with offices at Xxx Xxxxxx'x Xxxxx, Xxx Xxxxx, Xxxxxx (the
"Company"), and Xxxxxx X. Xxxxx ("Executive").
The Company and Executive agree as follows:
1. INTRODUCTORY STATEMENT
The Company desires to secure the services of Executive as Chairman of
the Board effective January 1, 2002, and Executive is willing to execute this
Agreement with respect to his employment. This Agreement is effective on
September 4, 2002, and shall expire January 1, 2005, subject to the terms and
conditions herein.
2. AGREEMENT OF EMPLOYMENT
The Company agrees to, and hereby does, employ Executive, and
Executive agrees to, and hereby does accept, employment by the Company, as
Chairman of the Board effective January 1, 2003, pursuant to the provisions of
this Agreement and of the bylaws of the Company, and subject to the control of
the Board of Directors ("Board"). It is understood that Executive's position as
Chairman of the Board is subject to his yearly re-election to this position by
the Board. (See paragraph 7 herein for Executive's rights if such re-election
does not occur during the term of this Agreement.) Executive's position as
Chairman of the Board is also subject to his remaining a member of the Board.
From the period of September 4, 2002, through December 31, 2002, Executive will
continue performing his duties as Chief Executive Officer and Chairman of the
Board.
3. EXECUTIVE'S OBLIGATIONS
During the period of his service as Chairman of the Board under this
Agreement, Executive shall devote a sufficient amount of his time and energy
during business hours, faithfully and to the best of his ability with other
Directors, to review and approve policies and strategies; prepare for and chair
all regular and special Board meetings; act as Chairman of Executive Committee
of the Board; act as an advisor and mentor to the new Chief Executive Officer;
and perform other services as requested by the Company's Board. Executive will
also serve as the Company's representative as a director for several companies
as well as at times represent the Company at customer and employee events.
4. COMPENSATION
Effective January 1, 2003, the Company shall pay to Executive a salary
at the rate of $500,000.00 per year, in equal bi-weekly installments for the
term of the Agreement. The Human Resources Committee of the Board (or any
successor committee responsible for setting compensation levels for Executives,
the "HRC") shall, in good faith discretion, review the salary of Executive, on
an annual basis, with a view to consideration of appropriate merit increases, if
any, in such salary. There will be no diminution of the above compensation
except as provided in this Agreement. During the term of this Agreement,
Executive will not be eligible for any additional bonuses, stock option grants,
or other long term compensation. All payments shall be subject to Executive's
chosen benefit deductions and the deduction of payroll taxes and similar
assessments as required by law.
Executive will use the Company's aircraft or charter aircraft for
security purposes for himself and his family for business and personal travel
(with standard charges for family members and for non-Company business usage),
based on availability. Executive will also be entitled to be reimbursed for
first class travel or charter aircraft travel expenses.
If Executive dies or resigns pursuant to this Agreement or pursuant to
any other agreement between the Company and Executive providing for such
resignation during the period of this Agreement, service for any part of the
month in which any such event occurs shall be considered service for the entire
month.
Executive will be provided appropriate office space, as well as
dedicated secretarial support, in Reno, Nevada. Executive will also receive
dedicated office space only in Las Vegas, Nevada.
5. BENEFITS
5.1 HEALTH INSURANCE
Executive will receive the regular group health plan (medical,
dental, vision) provided to senior officers, which may be subject to change
during the term of the Agreement. Executive will be required to contribute to
the cost of the basic plan in the same manner as other senior officers.
Executive will receive no less favorable a health plan than other senior
officers.
5.2 SHORT TERM AND LONG TERM DISABILITY BENEFITS
During the term of this Agreement, Executive will be eligible to
receive the normal long term coverage paid by the Company to its senior
executives.
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5.3 LIFE INSURANCE
During the term of this Agreement, Executive will also receive
Company paid group life insurance in the same amount as in effect for Executive
on December 31, 2002.
5.4 RETIREMENT PLAN
Executive will also be eligible during the term of the Agreement
to participate in the Company's 401(k) Plan, as may be modified or changed, as
well as its Executive Supplemental Savings Plan (ESSP), as may be modified or
changed from time to time, in the same manner as other senior officers of the
Company. Executive is also fully vested at the retirement rate in Executive
Deferred Compensation Plan (EDCP), but not allowed to contribute any new
deferral.
5.5 LONG TERM COMPENSATION
Executive will not be eligible for any additional long term
compensation benefits, and all unvested options previously granted to Executive,
to the extent they are unvested, will vest on his last day of employment,
January 1, 2005, and may be exercised per plan rules.
5.6 FINANCIAL COUNSELING
Executive will also receive during the term of the Agreement
Fifteen Thousand Dollars ($15,000) per year of the Agreement for financial
counseling. Any unused portion will not carry over to the following year.
6. TERMINATION FROM EMPLOYMENT
6.1 Except as otherwise provided in this Agreement, the date of
Executive's termination from employment shall be January 1, 2005.
6.2 After the date of Executive's termination from employment at any
time (including termination or resignation prior to January 1, 2005, if that
should occur), he will be entitled to participate for his lifetime in the
Company's group health insurance plans applicable to corporate executives,
including family coverage as applicable (medical, dental and vision coverage).
His group health insurance benefits after any termination of employment will not
be less than those offered to corporate officers of the Company, and he will be
entitled to any later enhancements in such benefits. However, during the Life
Coverage Period, Executive shall pay twenty percent (20%) of the current premium
(revised annually) on an after-tax basis each quarter, and the Company shall pay
eighty percent (80%) of said premium on an after-tax basis, which contribution
will be imputed income to Executive. As soon after the end of Executive's
full-time active employment status as Executive becomes eligible for Medicare
coverage, the Company's group health insurance plan shall become secondary to
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Medicare. His benefits will be the same as normally provided to other retired
management directors pursuant to the policy adopted by the HRC on October 26,
1990 (except to the extent he voluntarily elects not to participate in any
plan).
7. TERMINATION WITHOUT CAUSE OR RESIGNATION FOR GOOD REASON
7.1 The Board reserves the right to terminate Executive from his
then current position Without Cause at any time upon at least three (3) months
prior written notice, except as provided below. The failure of the Board to
elect Executive as Chairman of the Board during the annual election of officers
shall also be deemed termination Without Cause for purposes of this Agreement
unless, before the election, the Board has sent written notice initiating
Termination for Cause as provided in paragraph 12.1, and Executive is thereafter
terminated for Cause. Executive reserves the right to resign his position for
Good Reason (as defined in paragraph 12.2 herein) by giving the Company thirty
(30) days written notice which states the basis for such Good Reason.
7.2 Upon Executive's termination Without Cause or resignation from
his position for Good Reason as described in paragraph 7.1 above:
(a) Executive will receive salary continuation for up to two (2)
years beginning on the date of such termination and continuing to no later than
January 1, 2005, when terminated Without Cause or the resignation is for Good
Reason (the "Transition Period"). All unvested stock options, to the extent
unvested, will vest on January 1, 2005. If a Change in Control, as defined in
Executive's Severance Agreement, occurs during the Transition Period, all
unvested stock options will vest.
(b) Executive will continue to receive his then-current salary
rate and the right to participate in the Company's benefit plans, in accordance
with paragraph 5.1, during the Transition Period.
8. TERMINATION FOR CAUSE OR RESIGNATION WITHOUT GOOD REASON
8.1 The Board will have the right to terminate Executive at any time
from his then-current positions For Cause (as defined in paragraph 12.1 herein).
Executive shall resign from the Board promptly after the Company's request in
the event Executive is so terminated, or Executive resigns with or without Good
reason.
8.2 If Executive is terminated For Cause, or if he Resigns his
position without Good Reason, then: (a) all of his rights and benefits under
this Agreement shall thereupon terminate and his employment shall be deemed
terminated on the date of such termination or resignation; (b) he shall be
entitled to all accrued rights, payments and benefits vested or paid on or
before such date under the Company's plans and programs, but unvested stock
options or unvested restricted stock will be forfeited; (c) his right to
exercise vested stock options will expire at 11:59 p.m. PST on the date of such
termination or resignation, and all stock options not so exercised will be
forfeited;
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(d) his Indemnification Agreement will continue in force; (e) the Escrow
Agreement, if then in force, will continue in force, unless such agreement is
thereafter amended or terminated pursuant to its terms; (f) he will be entitled
to the lifetime group insurance benefits described in paragraph 6.2 above,
except that any future amendments to such benefits shall apply to him in the
same manner as such amendments apply to other employees; and (g) his Severance
Agreement and all rights thereunder will terminate as of such termination or
resignation date, unless a Change in Control or Potential Change in Control (as
such terms are defined in the Severance Agreement) has occurred prior to such
termination or resignation date. Notwithstanding anything to the contrary set
forth in this paragraph, Executive's rights do not extend past the term of the
Agreement, January 1, 2005.
If Executive's Severance Agreement is in force upon a Change in
Control (as defined in the Severance Agreement), the provisions of this
paragraph 8.2 will not be applicable if he resigns (for or without Good Reason)
within two (2) years after the Change in Control. In the event of such
resignation after a Change in Control, he will be entitled to the payments,
rights and benefits as provided in paragraph 11 below.
9. DEATH
In the event of Executive's death prior to January 1, 2005, during his
employment under this Agreement, his salary and all rights and benefits under
this Agreement will terminate, and his estate and beneficiary(ies) will receive
the benefits they are entitled to under the terms of the Company's benefit plans
and programs by reason of a participant's death during active employment,
including applicable rights and benefits under the Company's stock plans.
Notwithstanding anything to the contrary contained in the plan documents or this
paragraph, upon Executive's death, all of Executive's options will vest. The
Escrow Agreement, if then in force, will continue in force (subject to its
amendment or termination in accordance with its terms) for the benefit of
Executive's beneficiaries until his deferred compensation accounts are paid in
full, and Executive's Indemnification Agreement will continue in force for the
benefit of his estate. If Executive dies during the Transition Period, all of
the provisions of the previous sentences apply, except that the remaining salary
will be paid in a lump sum to his estate.
10. DISABILITY
In the event of Executive's disability (as defined below) prior to
January 1, 2005, during his employment, he will be entitled to apply, at his
option, for the Company's long-term disability benefits. If he is accepted for
such benefits, then the terms and provisions of the Company's benefit plans and
programs (Stock Option and Restricted Stock Plan) that are applicable in the
event of such disability of an employee shall apply in lieu of the salary and
benefits under this Agreement, except that: (a) the Escrow Agreement (if then in
force) and his Indemnification Agreement will continue in force (subject to
amendment or termination in accordance with their terms); and (b) he
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will be entitled to the lifetime group insurance benefits described in paragraph
6.2. If Executive is disabled so that he cannot perform his duties (as
determined by the HRC), and if he does not apply for long-term disability
benefits or is not accepted for such benefits, then the Board may terminate his
duties under this Agreement. For purposes of this Agreement, disability will be
the inability of Executive, with or without a reasonable accommodation, to
perform the essential functions of his job, as determined by the HRC. In such
event, he will receive two (2) years salary continuation (offset by any long
term disability benefits to which he is entitled), together with all other
benefits, and during such period of salary continuation, any stock options and
restricted stock then in existence will continue in force for vesting purposes.
However, during such period of salary continuation for disability, Executive
will not be eligible to participate in the annual bonus plan, nor will he be
eligible to receive new stock option grants or any other long-term incentive
awards except to the extent approved by the HRC. Not withstanding anything to
the contrary contained in this paragraph, all the Company's obligations to
Executive, including salary continuation, will cease as of January 1, 2005.
11. CHANGE IN CONTROL
Except as provided in paragraph 7.2, if a Change in Control as defined
in Executive's Severance Agreement occurs prior to Executive's termination of
employment, and if the Severance Agreement is in force when the Change in
Control occurs, then, upon his termination or voluntary or involuntary
resignation within two (2) years after the Change in Control (prior to January
1, 2005, due to expiration of this Agreement), except if his termination of
employment is for "Cause," "Disability" or "Retirement" as set forth in the
Severance Agreement, he will be entitled to all the rights, payments and
benefits provided under his Severance Agreement, including the benefits that the
Severance Agreement provides with respect to the benefit plans and programs of
the Company resulting from his termination or voluntary resignation, in lieu of
the rights and benefits that would otherwise apply under this Agreement by
virtue of his termination or resignation; PROVIDED that: (a) the Escrow
Agreement (if then in force and subject to amendment or termination in
accordance with its terms) and his Indemnification Agreement will continue in
force; and (b) he will be entitled to the lifetime group insurance benefits
described in paragraph 6.2. Executive acknowledges the HRC is conducting a
review of the severance agreements with respect to calendar year 2003.
Accordingly, Executive and Company agree that, notwithstanding any language
contained in Executive's Severance Agreement, timely notice under the Severance
Agreement for the year 2003 will be September 30, 2002.
12. DEFINITIONS OF CAUSE AND GOOD REASON
12.1(a) For purposes of this Agreement, "Cause" shall mean:
(i) the willful failure of Executive to perform
Executive's duties with the Company (as described in paragraph 3) or to follow a
lawful directive from the Board (other than any such failure resulting from
incapacity due to physical or mental illness), after a written demand for
performance is delivered to Executive by the
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Board which specifically identifies the manner in which the Board believes that
Executive has not performed Executive's duties or to follow a lawful directive
and Executive is given a reasonable opportunity (not in excess of thirty (30)
days) to cure any such failure to perform, if curable;
(ii) (A) any intentional act of fraud, or embezzlement or
theft by Executive, in each case, in connection with Executive's duties
hereunder or in the course of Executive's employment hereunder or (B)
Executive's admission in any court, or conviction of, a felony involving moral
turpitude, fraud, or embezzlement, theft or misrepresentation, in each case,
against the Company.
12.1(b) Termination by the Company of this Agreement for "Cause"
shall also include Executive being found unsuitable for or having a gaming
license denied or revoked by the gaming regulatory authorities in Arizona,
California, Colorado, Illinois, Indiana, Iowa, Kansas, Louisiana, Mississippi,
Missouri, Nevada, New Jersey, New York, and North Carolina.
12.1(c) Termination by the Company of this Agreement for "Cause"
shall also include (i) Executive's willful and material violation of, or
noncompliance with, any securities laws or stock exchange listing rules,
including, without limitation, the Xxxxxxxx-Xxxxx Act of 2002, provided that
such violation or noncompliance resulted in material economic harm to the
Company, or (ii) a final judicial order or determination prohibiting Executive
from service as an officer pursuant to the Securities and Exchange Act of 1934
or the rules of the New York Stock Exchange.
For purposes of this provision, no act or failure to act, on the part
of Executive, shall be considered "willful" unless it is done, or omitted to be
done, by Executive in bad faith or without reasonable belief that Executive's
action or omission was in the best interests of the Company. Any act, or failure
to act, based upon authority given pursuant to a resolution duly adopted by the
Board or based upon the advice of counsel for the Company shall be conclusively
presumed to be done, or omitted to be done, by Executive in good faith and in
the best interests of the Company, provided Executive has disclosed all material
facts to the Board or such counsel. The cessation of employment of Executive
shall not be deemed to be for Cause, pursuant to this paragraph 12.1(a), unless
and until there shall have been delivered to Executive a copy of a resolution
duly adopted by the affirmative vote of not less than three-quarters of the
entire membership of the Board at a meeting of the Board called and held for
such purpose (after reasonable notice is provided to Executive and Executive is
given an opportunity, together with counsel for Executive, to be heard before
the Board), finding that, in the good faith opinion of the Board, Executive is
guilty of the conduct described in paragraphs 12.1(a)(i)(ii), 12.1(b), or
12.1(c) and specifying the particulars thereof in detail; PROVIDED, that as
Executive is a member of the Board, Executive shall not vote on such resolution
nor shall Executive be counted in determining the "entire membership" of the
Board.
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12.2 GOOD REASON. "Good Reason" shall mean, without Executive's
express written consent, the occurrence of any of the following circumstances
unless, in the case of paragraphs (a), (d), (e), (f) or (g), such circumstances
are fully corrected prior to the date of termination specified in the written
notice given by Executive notifying the Company of his resignation for Good
Reason:
(a) The assignment to Executive of any duties inconsistent
materially with his status as Chairman of the Board of the Company or a
substantial adverse alteration in the nature or status of his responsibilities;
(b) A reduction by the Company in his annual base salary of Five
Hundred Thousand Dollars ($500,000.00) or as the same may be increased from time
to time pursuant to paragraph 4 hereof;
(c) The relocation of the Company's principal employee offices
from Las Vegas, Nevada, to a location more than fifty (50) miles from such
offices, or the Company's requiring Executive either: (i) to be based anywhere
other than the location of the Company's principal offices in Las Vegas (except
for required travel on the Company's business to an extent substantially
consistent with Executive's present business travel obligations); or (ii) to
relocate his primary residence from Reno to Las Vegas;
(d) The failure by the Company to pay to him any material
portion of his current compensation, except pursuant to a compensation deferral
elected by Executive, or deferral compensation required by this Agreement, or to
pay to Executive any material portion of an installment of deferred compensation
under any deferred compensation program of the Company within thirty (30) days
of the date such compensation is due;
(e) Except as permitted by this Agreement, the failure by the
Company to continue in effect any compensation plan in which Executive is
participating on the date of this Agreement which is material to Executive's
total compensation, including but not limited to, the Company's ESSP, or any
substitute plans, unless an equitable arrangement (embodied in an ongoing
substitute or alternative plan) has been made with respect to such plan, or the
failure by the Company to continue Executive's participation therein (or in such
substitute or alternative plan) on a basis not materially less favorable, both
in terms of the amount of benefits provided and the level of Executive's
participation relative to other participants at Executive's grade level;
(f) The failure by the Company to continue to provide Executive
with benefits substantially similar to those enjoyed by him under the S&RP and
the life insurance, medical, health and accident, and disability plans in which
Executive is participating on the date of this Agreement, the taking of any
action by the Company which would directly or indirectly materially reduce any
of such benefits or deprive
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Executive of any material fringe benefit enjoyed by Executive on the date of
this Agreement, except as permitted by this Agreement; or
Notwithstanding any provision of this Agreement to the contrary, in
the event Executive is no longer Chairman of the Board or of Executive Committee
because he is not re-nominated or re-elected to the Board in 2004, or as a
result of the requirement that the Company's Chairman of the Board or Executive
Committee be an "outside" or "independent" director under listing rules, laws or
regulations, or a change in Company policy adopted by the HRC, such occurrences
shall not constitute "Good Reason" hereunder. If Executive is not able to serve
as Chairman, but re-elected to the Board, he will continue as a Director on the
same terms set forth herein. If Executive is not re-nominated or re-elected to
the Board in 2004, he continues as an employee on the same terms set forth
herein.
Executive's right to terminate his employment pursuant to this
Agreement for Good Reason shall not be affected by Executive's incapacity due to
physical or mental illness. Executive's continued employment shall not
constitute consent to, or a waiver of rights with respect to, any circumstance
constituting Good Reason hereunder.
Notwithstanding any provision in this Agreement to the contrary, in
the event Executive's active employment as an Executive officer with the
Company, or its direct or indirect subsidiaries, terminates For Cause or
Executive ceases employment Without Good Reason, stock options granted to
Executive which are unvested on the date of such termination of active
employment will be forfeited as of 11:59 p.m. PST on such date.
13. NON-COMPETITION AGREEMENT
13.1 For a period of two (2) years after Executive's active
employment (which, for purposes of this paragraph 13.1, shall not include the
salary continuation period under paragraph 7.2(a)) with the Company or a direct
or indirect subsidiary ends, he will not, directly or indirectly, solicit or
recruit any employee of the Company or of any of its direct or indirect
subsidiaries, and he will not engage in any activity, including development
activity, whether as an employee, consultant, director, investor, contractor, or
otherwise, directly or indirectly, in the casino, casino/hotel, or
casino/hotel/resort business including the development of such business, in the
United States, Canada or Mexico that is competitive with any business that the
Company or its direct or indirect subsidiaries are engaged (as owner, manager,
consultant, licensor, partner, or otherwise) in at the time such employment
ends, except with the prior specific approval of the Company. Executive
acknowledges that the restrictions are reasonable as to both time and geographic
scope, as the Company competes for customers with all gaming establishments in
these areas.
13.2 If Executive breaches any of the covenants in paragraph 13.1,
then the Company may terminate any of his rights under this Agreement upon
thirty (30) days written notice, whereupon all of the Company's obligations
under this Agreement
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shall terminate (including, without limitation, the right to lifetime group
insurance) without further obligation to him except for obligations that have
been paid, accrued or are vested as of or prior to such termination date. In
addition, the Company shall be entitled to enforce any such covenants, including
obtaining monetary damages, specific performance and injunctive relief.
13.3 Executive will not, at any time prior to two (2) years from the
end of Executive's active employment status (which, for purposes of this
Agreement, shall not include the time period Executive is receiving salary
continuation under paragraph 7.2(a)), directly or indirectly induce, persuade or
attempt to induce or persuade, any salary grade 20 or higher employee of the
Company, or its subsidiaries, to leave or abandon employment with the Company,
its subsidiaries or affiliates, for any reason whatsoever.
13.4. Executive will not, from the end of his active full-time active
employment, communicate with employees, customers, or suppliers of the Company,
or its subsidiaries or affiliates of the Company or any principals or employee
thereof, or any person or organization in any manner whatsoever that is
detrimental to the interest of the Company, its subsidiaries or affiliates.
Executive further agrees from the end of his active full-time employment not to
make statements to the press or general public with respect to the Company or
its subsidiaries or affiliates that are detrimental to the Company, its
subsidiaries, affiliates or employees without the express written prior
authorization of the Company. Notwithstanding the foregoing, Executive shall not
be prohibited at the expiration of the non-competition period from pursuing his
own business interests which may conflict with the interests of the Company.
13.5 Executive and Company each intends and agrees that if, in any
action before any court, agency or arbitration tribunal, legally empowered to
enforce the covenants in this paragraph 13, any term, restriction, covenant or
promise contained therein is found to be unreasonable and, accordingly,
unenforceable, then such terms, restriction, covenant or promise shall be deemed
modified to the extent necessary to make it enforceable by such court or agency.
13.6 Should any court, agency or arbitral tribunal legally empowered
to enforce the covenants contained in this paragraph 13 fail or refuse to
enforce the terms, restrictions covenants or promises herein (except if it has
been modified to make it enforceable): (i) the Company will not be obligated to
pay Executive the consultant payments contained in the Agreement (except for
required benefits under benefit plans), and (ii) Executive will also reimburse
the Company any consultant payments received, as well as any reasonable costs,
and attorney fees to secure such repayments.
14. CONFIDENTIALITY
14.1 Executive's position with the Company will or has resulted in
his exposure and access to confidential and proprietary information which he did
not have
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access to prior to holding the position, which information is of great value to
the Company and the disclosure of which by him, directly or indirectly, would be
irreparably injurious and detrimental to the Company. During his term of
employment and without limitation thereafter, Executive agrees to use his best
efforts and to observe the utmost diligence to guard and protect all
confidential or proprietary information relating to the Company from disclosure
to third parties. Executive shall not at any time during and after the end of
his active employment, make available, either directly or indirectly, to any
competitor or potential competitor of the Company or any of its subsidiaries, or
their affiliates or divulge, disclose, communicate to any firm corporation or
other business entity in any manner whatsoever, any confidential or proprietary
information covered or contemplated by this Agreement, unless expressly
authorized to do so by the Company in writing.
14.2 For the purpose of this Agreement, "Confidential Information"
shall mean all information of the Company, its subsidiaries and affiliates,
relating to or useful in connection with the business of the Company, its
subsidiaries, affiliates, whether or not a "trade secret" within the meaning of
applicable law, which at the time of Executive's initial employment is not
generally known to the general public and which has been or is from time to time
disclosed to or developed by Executive as a result of his employment with the
Company. Confidential Information includes, but is not limited to the Company's
product development and marketing programs, data, future plans, formula, food
and beverage procedures, recipes, finances, financial management systems, player
identification systems (Total Rewards), pricing systems, client and customer
lists, organizational charts, salary and benefit programs, training programs,
computer software, business records, files, drawings, prints, prototyping
models, letters, notes, notebooks, reports, and copies thereof, whether prepared
by him or others, and any other information or documents which Executive is told
or reasonably ought to know that the Company regards as confidential.
14.3 Executive agrees that upon separation of employment for any
reason whatsoever, he shall promptly deliver to the Company all confidential
information, including but not limited to, documents, reports, correspondences,
computer printouts, work papers, files, computer lists, telephone and address
books, rolodex cards, computer tapes, disks, and any and all records in his
possession (and all copies thereof) containing any such confidential information
created in whole or in part by Executive within the scope of his employment,
even if the items do not contain confidential information.
14.4 Executive shall also be required to sign a non-disclosure or
confidentiality agreement. Such an agreement shall also remain in full force and
effect, PROVIDED THAT, in the event of any conflict between any such
agreement(s) and this Agreement, this Agreement shall control.
14.5 This paragraph and any of its provisions will survive
Executive's separation of employment for any reason.
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15. INJUNCTIVE RELIEF
Executive acknowledges and agrees that the terms provided in
paragraphs 13 and 14 are the minimum necessary to protect the Company, its
affiliates and subsidiaries, its successors and assigns in the use and enjoyment
of the confidential information and the good will of the business of the
Company. Executive further agrees that damages cannot fully and adequately
compensate the Company in the event of a breach or violation of the restrictive
covenants (confidential information and non-competition) and that without
limiting the right of the Company to pursue all other legal and equitable
remedies available to it, that the Company shall be entitled to injunctive
relief, including but not limited to a temporary restraining order, temporary
injunction and permanent injunction, to prevent any such violations or any
continuation of such violations for the protection of the Company. The granting
of injunctive relief will not act as a waiver by the Company to pursue any and
all additional remedies.
16. POST EMPLOYMENT COOPERATION
Executive agrees that upon separation for any reason from the Company,
Executive will cooperate in assuring an orderly transition of all matters being
handled by him. Upon the Company providing reasonable notice to him, he will
also appear as a witness at the Company's request and/or assist the Company in
any litigation, bankruptcy or similar matter in which the Company or any
affiliate thereof is a party or otherwise involved. The Company will defray any
reasonable out-of-pocket expenses incurred by Executive in connection with any
such appearance. In connection thereof, the Company agrees to indemnify
Executive as prescribed in Article Tenth of the Certificate of Incorporation, as
amended, of HET.
17. RELEASE
Upon the termination of Executive's active full-time employment, and
in consideration of the receipt of the salary and benefits described in this
Agreement, except for claims arising from the covenants, agreements, and
undertakings of the Company as set forth herein and except as prohibited by
statutory language, Executive will sign an agreement which forever and
unconditionally waives, and releases Xxxxxx'x Entertainment, Inc., Xxxxxx'x
Operating Company, Inc., their subsidiaries and affiliates, and their officers,
directors, agents, benefit plan trustees, and employees ("Released Parties")
from any and all claims, whether known or unknown, and regardless of type, cause
or nature, including but not limited to claims arising under all salary,
vacation, insurance, bonus, stock, and all other benefit plans, and all state
and federal anti-discrimination, civil rights and human rights laws, ordinances
and statutes, including Title VII of the Civil Rights Act of 1964 and the Age
Discrimination in Employment Act, concerning his employment with Xxxxxx'x
Entertainment, Inc., its subsidiaries and affiliates, and the cessation of that
employment.
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18. ASSUMPTION OF AGREEMENT ON MERGER, CONSOLIDATION OR SALE OF ASSETS
In the event the Company agrees to (i) enter into any merger or
consolidation with another company in which the Company is not the surviving
company; or (ii) sell or dispose of all or substantially all of its assets, and
the company which is to survive fails to make a written agreement with Executive
to either: (1) assume the Company's financial obligations to Executive under
this Agreement; or (2) make such other provision for Executive as is
satisfactory to Executive, then Executive shall have the right to resign For
Good Reason as defined under this Agreement.
19. ASSURANCES ON LIQUIDATION
The Company agrees that until the termination of this Agreement as
above provided, it will not voluntarily liquidate or dissolve without first
making a full settlement or, at the discretion of Executive, a written agreement
with Executive satisfactory to and approved by him in writing, in fulfillment of
or in lieu of its obligations to him under this Agreement.
20. AMENDMENTS
This Agreement may not be amended or modified orally, and no provision
hereof may be waived, except in a writing signed by the parties hereto.
21. ASSIGNMENT
21.1 Except as otherwise provided in paragraph 21.2, this Agreement
cannot be assigned by either party hereto, except with the written consent of
the other. Any assignment of this Agreement by either party shall not relieve
such party of its or his obligations hereunder.
21.2. The Company may elect to perform any or all of its obligations
under this Agreement through its wholly-owned subsidiary, Xxxxxx'x Operating
Company, Inc., or another subsidiary, and if the Company so elects, Executive
will be an employee of Xxxxxx'x Operating Company, Inc., or such other
subsidiary. Notwithstanding any such election, the Company's obligations to
Executive under this Agreement will continue in full force and effect as
obligations of the Company, and the Company shall retain primary liability for
their performance.
22. BINDING EFFECT
This Agreement shall be binding upon and inure to the benefit of the
personal representatives and successors in interest of the Company.
23. GOVERNING LAW
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This Agreement shall be governed by the laws of the State of Nevada as
to all matters, including but not limited to matters of validity, construction,
effect and performance.
24. JURISDICTION
Any judicial proceeding seeking to enforce any provision of, or based
on any right arising out of, this Agreement or any agreement identified herein
may be brought only in state or federal courts of the State of Nevada, and by
the execution and delivery of this Agreement, each of the parties hereto accepts
for themselves the exclusive jurisdiction of the aforesaid courts and
irrevocably consents to the jurisdiction of such courts (and the appropriate
appellate courts) in any such proceedings, waives any objection to venue laid
therein and agrees to be bound by the judgment rendered thereby in connection
with this Agreement or any agreement identified herein.
IN WITNESS WHEREOF, Executive has hereunto set his hand and the Company has
caused this Agreement to be executed in its name and on its behalf and its
corporate seal to be hereunto affixed and attested by its corporate officers
thereunto duly authorized.
/s/ XXXXXX X. XXXXX
-----------------------------------
Xxxxxx X. Xxxxx
Xxxxxx'x Entertainment, Inc.
By /s/ XXXXXXX X. XXXXXXXX
--------------------------------
Its: Senior Vice President
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