EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is entered into as of May 20,
1999 (the "Effective Date"), by and among Mirage Resorts, Incorporated,
a Nevada corporation ("MRI"), GNLV, CORP., a Nevada corporation
("Employer") and Xxxxx X. Xxxxx ("Employee").
1. Employer and MRI hereby employ Employee initially as the Chairman
and Chief Executive Officer of Employer, with primary responsi-
bility to oversee the operations of Beau Rivage, and as MRI's
Executive Vice President-Marketing and Hotel Operations. Employee
shall report directly to, and be subject to the authority of,
Employer's Board of Directors and MRI's Chairman. Employee shall
perform such executive, supervisory and managerial duties for
Employer, MRI, and MRI's other affiliated and subsidiary corpor-
ations and entities (collectively, "Affiliates") as MRI or
Employer may specify from time to time, which shall be comparable
with his initial responsibilities and duties hereunder. Employer
or MRI may, at any time and from time to time, change any of
Employee's titles specified herein. Employee shall devote his full
business time and efforts in good faith to the performance of his
duties hereunder. Employee's permanent residence shall be in Las
Vegas, Nevada. Employee acknowledges that he will be required to
travel extensively outside Xxxxx County in performing his duties
hereunder and shall be entitled to the use of a corporate aircraft
at Employer's or MRI's expense.
2. The term of this Agreement shall commence on the Effective Date
and terminate on the third anniversary of the Effective Date (the
"Employment Period"), except as earlier terminated pursuant to the
terms of this Agreement. As used in this Agreement, the term
"year" shall mean each successive 12-month period ending on each
anniversary of the Effective Date.
3. (a) Employee shall receive an annual gross base salary of
$1,000,000 (before deduction of employment taxes and other amounts
required by law to be withheld) and such merit bonuses as
Employer's Board of Directors may determine in its sole
discretion. Employee's annual gross salary may be increased by
the Board of Directors of Employer in its sole discretion, and any
higher annual base salary shall thereafter be deemed to be the
annual base salary for purposes of this Agreement. Employee's base
salary shall be payable in equal installments in accordance with
Employer's regular payroll practices during the Employment Period.
EXHIBIT 10.1
(b) Employee and his dependents shall be provided with coverage
under MRI's executive medical and life insurance plans, paid
vacation and such other plans and benefits as MRI and its subsid-
iaries from time to time make available to their executives of
similar stature.
(c) Employer shall provide Employee with office accommodations,
including furniture and furnishings, secretarial and other assis-
tance, commensurate with Employee's stature and position.
Employer shall reimburse Employee for all reasonable business
expenses incurred by Employee in performing his duties hereunder
which are supported by appropriate documentation in accordance
with Employer's policies.
(d) MRI shall amend the vesting date of Employee's stock options
granted on August 16, 1995 to May 16, 2004.
4. Employee acknowledges and agrees that the laws of Nevada and other
jurisdictions in which Employer or Affiliates may engage or
propose to engage in business activities during the term hereof
may require that Employee be investigated for suitability and
licensing. Employee shall cooperate with the appropriate govern-
mental authorities in order that Employer and Affiliates and he
may obtain all certificates, permits and licenses which are
required in connection with his employment hereunder or Employer's
and Affiliates' conduct of business during the term hereof.
Employee further acknowledges and agrees that in the event he
fails to so cooperate or he or Employer or Affiliates, for any
reason attributable to Employee, fails to obtain, within the time
specified by Nevada Gaming Commission and all other governmental
authorities having jurisdiction, or, for any reason attributable
to Employee, fails to thereafter maintain, in good standing and in
full force and effect, during the term hereof, all required cer-
tificates, permits and licenses in connection with his employment
hereunder or Employer's or Affiliates' conduct of business, or
Employee is convicted of or pleads nolo contendere to any criminal
act which could reasonably be expected to result in the suspension
or revocation of any such certificate, permit or license, such
shall constitute Good Cause for Employer to terminate this Agree-
ment as provided in Paragraph 6 hereof.
5. Employee covenants and agrees that during the stated Employment
Period, Employee shall not directly or indirectly be employed by,
render services for, engage in, participate in, consult for or
otherwise be connected in any way (other than on behalf of
-2-
Employer or Affiliates) with any individual, firm, corporation or
other entity engaged in the gaming or hotel/hospitality industry.
The restriction on Employee's activities set forth in the immedi-
ately preceding sentence shall not apply following termination of
this Agreement as provided in Paragraph 7 hereof (whether by
Employer or Employee). Employee acknowledges and agrees that the
restrictions on his activities set forth in this Paragraph 5 are
reasonable, that Employee has been adequately compensated under
this Agreement for the future financial hardship that compliance
with such provisions might otherwise have created and that
Employee has available other suitable employment opportunities
which eliminate the need for employment which would violate such
provisions. In addition to all other rights and remedies provided
to Employer hereunder, if Employee materially breaches any of the
obligations contained in this Paragraph 5, Employer shall have the
right to terminate this Agreement in accordance with Paragraph
6(b) hereof, but any such termination shall in no event be deemed
an election of remedies and Employer expressly reserves all other
legal and equitable remedies. Employee further covenants and
agrees that he shall not at any time during the term of this
Agreement or thereafter, without Employer's prior written consent,
disclose to other individuals or entities any trade secrets or
other confidential information concerning Employer or Affiliates,
including without limitation, their customers, casino, hotel,
marketing or entertainment practices or procedures, management
policies or non-public financial information, or utilize any such
trade secrets or confidential information in any way or communi-
cate with or contact any such customers, other than in connection
with his employment hereunder. For purposes of this Agreement,
"trade secrets and confidential information" shall not include
information which is: (i) generally known in the gaming or hotel/
hospitality industry; (ii) in the public domain; or (iii) indepen-
dently obtained by Employee from third parties under no obligation
of confidentiality to Employer or Affiliates or to any third
party. Employee hereby confirms that such trade secrets and con-
fidential information constitute Employer's exclusive property,
that all of the restrictions on his activities contained in this
Agreement are required for Employer's reasonable protection and
that in the event of any breach of this Paragraph 5 by him,
Employer will be entitled, if it so elects, to institute and
prosecute proceedings at law or in equity to obtain damages with
respect to such breach, to seek to enforce the specific perfor-
xxxxx of this Paragraph 5 or to seek to enjoin Employee from
engaging in any activity in violation hereof.
-3-
6. This Agreement may be terminated by Employer at any time during
the Employment Period for "Good Cause" (as defined below) and upon
any such termination, Employer shall have no further liability or
obligation whatsoever to Employee hereunder except that Employee
(or his estate) shall be promptly paid any unpaid portion of
Employee's base salary, any unpaid perquisites earned hereunder
and any unreimbursed business expenses, in each case through the
date of termination. "Good Cause" shall mean and be limited to:
(a) Employee's death or "Disability" ("Disability" is hereby
defined to mean Employee's physical or mental incapacity certified
to by a licensed physician designated by Employer which precludes
the performance of his duties hereunder for a substantially con-
secutive period of four (4) months or more); and
(b) Employee's dishonesty in his relationship with Employer,
willful insubordination, conviction of or plea of nolo contendere
to any felony or a misdemeanor involving moral turpitude, willful
failure to substantially perform his duties diligently in good
faith and to the best of his ability, the occurrence of an event
specified in the last sentence of Paragraph 4 hereof or any other
material breach of this Agreement by Employee, any or all of
which, if curable, is not cured by Employee within a reasonable
time after his receipt of written notice thereof from Employer
describing in reasonable detail the material facts and circum-
stances supporting such termination.
7. (a) Employee shall have the right to terminate his employment
hereunder in the event of a "Material Breach" (as defined below)
of this Agreement by Employer which, if curable, is not cured
within a reasonable time after Employer's receipt of written
notice thereof from Employee describing in reasonable detail the
material facts and circumstances supporting such termination. If
Employer terminates Employee's employment hereunder other than
pursuant to Paragraph 6(a) or 6(b) of this Agreement, or if
Employee resigns as a result of a Material Breach of this Agree-
ment by Employer which, if curable, is not cured by Employer
within a reasonable time after receipt of written notice thereof
from Employee, Employee shall, subject to Employee's continuing
duty to mitigate damages, (A) continue to be paid his annual base
salary and other benefits through the end of the stated
-4-
Employment Period, as and when such salary and other benefits
would have been payable pursuant to Paragraphs 3(a) and 3(b)
hereof and (B) promptly be paid any unpaid perquisites earned
hereunder and any unreimbursed business expenses though the date
of termination. The foregoing shall constitute Employee's sole
and exclusive remedy for or relating to Employer's breach of this
Agreement or any other claim Employee may have or assert arising
out of the employment relationship between Employer and Employee,
whether such claim arises in contract, tort, pursuant to statute
or otherwise.
(b) For purposes of this Agreement, a "Material Breach" of this
Agreement shall mean and be limited to: (i) Employer's failure to
pay Employee any sum which Employee establishes is due to Employee
hereunder within fifteen (15) days after receiving written notice
from Employee that such sum is due but unpaid; or (ii) a material
breach of a material provision of this Agreement by Employer, in
each case subject to the notice and cure provisions set forth
above.
8. Employee represents, warrants and covenants to Employer that
Employee is not a party or otherwise subject to any agreement or
restriction which would be breached or violated by Employee's
execution of this Agreement or his employment hereunder.
9. If any provision of this Agreement is held to be unenforceable or
invalid for any reason whatsoever, such fact shall not affect the
remaining provisions hereof. If any of the provisions of this
Agreement which impose restrictions on Employee are, with respect
to such restrictions, determined by a final judgment of any court
of competent jurisdiction to be unenforceable or invalid because
of the geographic scope or time duration of such restrictions,
such provisions shall be deemed retroactively limited to provide
for the maximum geographic scope and time duration which would
make such provisions enforceable and valid. However, no such
retroactive modification of such restrictive provisions shall
affect any of Employer's rights hereunder arising out of the
breach of any such restrictive provisions, including without
limitation, Employer's right to terminate this Agreement.
10. No failure or delay on the part of Employer or Employee in
exercising any right, power or remedy hereunder shall operate as a
waiver thereof nor shall any single or partial exercise of any
such right, power or remedy preclude any other or further
-5-
exercise thereof or the exercise of any other right, power or
remedy hereunder. The remedies herein provided are cumulative and
not exclusive of any remedies provided by law.
11. No amendment, modification, termination or waiver of any provision
of this Agreement nor consent to any departure by Employee or
Employer therefrom shall in any event be effective unless the same
shall be in writing and signed by a duly authorized officer of
Employer and by Employee. Any such waiver or consent shall be
effective only in the specific instance and for the specific
purpose for which given.
12. Except as provided in Paragraph 5 hereof, in the event of any
dispute arising out of the interpretation, enforcement or appli-
cation of any of the provisions of this Agreement, or any other
controversy or claim arising out of, relating to or in connection
with this Agreement or Employee's employment with Employer,
Employee and Employer agree to waive all rights to a jury trial
and to submit such dispute to exclusive arbitration before a
single arbitrator in accordance with the Commercial Arbitration
Rules of the American Arbitration Association. Such arbitration
shall occur in Las Vegas, Nevada. The arbitrator shall be
selected by the mutual agreement of the parties, or failing such
agreement within ten (10) days after the receipt of written notice
from one party proposing to the other one or more possible
arbitrators, such other person as shall be appointed by the appli-
cation of any of the parties to the American Arbitration
Association. The arbitrator shall not be empowered to vary from
any of the express terms or provisions of this Agreement, and his
decision shall be final and binding upon the parties hereto.
Judgment upon the award rendered by the arbitrator may be entered
in any court having jurisdiction thereof. The prevailing party
shall be entitled to recover its reasonable attorneys' fees and
expenses, and the fees and expenses of the arbitrator shall be
paid by the non-prevailing party. The prevailing party shall be
determined by the arbitrator. The provisions of this Paragraph 12
shall survive any termination of this Agreement.
13. This Agreement sets forth the entire agreement of the parties with
respect to the subject matter hereof and supersedes any and all
prior negotiations, agreements or understandings, whether oral or
written.
14. This Agreement shall be controlled, construed and enforced in
accordance with the laws of the State of Nevada, excluding its
conflict or choice of laws principles. Except as provided in
Paragraph 12 hereof, any legal action in any way relating to or
arising out of this Agreement or Employee's employment relation-
ship with Employer shall be instituted and maintained in federal
or state court in Las Vegas, Nevada, and the parties hereby
consent to the exclusive jurisdiction of such courts.
-6-
15. Any and all notices required or permitted to be given hereunder
shall be in writing and sent by personal delivery or registered or
certified mail to Employee's last known Las Vegas, Nevada
residence (as reflected in Employee's personnel file), in the case
of Employee, or to Employer's principal office in Las Vegas,
Nevada (with a copy to MRI's General Counsel at MRI's principal
office), in the case of Employer.
16. This Agreement shall be binding on, and shall inure to the benefit
of, the parties hereto and their respective legal representatives,
successors and permitted assigns (including, without limitation,
Employee's estate and heirs). This Agreement (and all rights and
obligations hereunder) shall not be assignable by Employee.
Employer shall have the right to assign this Agreement to any of
Affiliates or Employer's successors.
IN WITNESS WHEREOF, Employer and Employee have entered into this
Agreement in Las Vegas, Nevada, as of the Effective Date first above
written.
Mirage Resorts, Incorporated
By: XXXXXXX X. XXXX
------------------------------------
XXXXXXX X. XXXX
Chairman and Chief Executive Officer
GNLV, CORP.
By: XXXXX X. XXXXX
------------------------------------
XXXXX X. XXXXX
Assistant Secretary
XXXXX X. XXXXX
------------------------------------
XXXXX X. XXXXX
-7-
