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EXHIBIT 10(56)
SENIOR EXECUTIVE SEVERANCE AGREEMENT
THIS AGREEMENT, by and between STRATOSPHERE CORPORATION, a Delaware
corporation (the "Corporation'), and XXXXXXX XXXXXXX (the "Executive"),
WITNESSETH:
WHEREAS, the Board of Directors of the Corporation (the "Board") has
determined that the Executive is a key executive of the Corporation and/or one
or more of its Subsidiaries and it is the desire of the Board to assure itself
of the availability of the services of the Executive and to provide assurances
to the Executive of employment in the event of a financial restructuring or
reorganization or in the event of a change in control of the Board
(collectively an "Event");
WHEREAS, in the event that there occurs an Event, the Board believes it
imperative that the Corporation and the Board be able to rely upon the
Executive to continue in his position and, if required, to assess any proposal
or transaction which would cause an Event and advise management and the Board
as to whether such proposal or transaction would be in the best interest of the
Corporation and its stockholders, free from concern that his recommendations
may adversely affect his continued employment:
NOW, THEREFORE, to assure the Corporation that it will have the continued
dedication of the Executive and the availability of his advice and counsel
notwithstanding the possibility, threat or occurrence of an Event and to
induce the Executive to remain in the employ of the Corporation and/or one or
more of its Subsidiaries, and for other good and valuable consideration, the
receipt, adequacy and sufficiency of which are hereby acknowledged, the
Corporation and the Executive agree as follows:
1. Services During Certain Events. In the event that any steps are taken
which may constitute the possibility, threat or occurrence of an Event, the
Executive agrees that he will not voluntarily leave the employ of the
Corporation or any of its Subsidiaries and will continue to render services to
the Corporation and its Subsidiaries until, in the opinion of the Board, either
efforts to effect an Event have been abandoned or terminated or until one (1)
year after an Event has occurred. Any decision by the Board that efforts to
effect an Event have been abandoned or terminated shall be conclusive and
binding on the Executive.
2. Severance Payments. In the event that the Corporation terminates the
Executive's employment or materially either diminishes or reduces his title,
compensation, authority, responsibility, functions or duties with the
Corporation and its Subsidiaries within one (1) year after an Event for any
reason other than "for cause" (as defined herein) or as a consequence of his
death or disability, then, within thirty (30) days after such termination of
employment, the Corporation shall pay to the Executive as compensation for
services rendered to the Corporation and its Subsidiaries cash in an amount
equal to six (6) months of his aggregate base salary (excluding bonus or
options) for the six (6) month period immediately preceding the date of
termination plus any and all accrued salary and accrued vacation pay.
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3. Definitions.
(a) "Change of control of Board" means Grand Casino Inc. for whatever
reason not being able to elect a majority of the members of the Board of the
Corporation.
(b) "For cause" shall mean (1) the commission of fraud, embezzlement or
theft against the Corporation or any of its Subsidiaries or against any
employee, customer or business associate of the Corporation or any of its
Subsidiaries or (2) a conviction of, or guilty plea to, a felony.
(c) "Person" shall have the same meaning as such term has under section
13(d) of the Act and the regulations promulgated thereunder.
(d) "Subsidiary" shall mean any domestic or foreign corporation,
partnership or entity, a majority of whose equity securities is owned directly
or indirectly by the Corporation or by other Subsidiaries.
4. Indemnification. If litigation shall be brought to enforce or
interpret any provision contained herein or to recover from the Executive any
moneys paid pursuant to this Agreement, the Corporation, to the extent
permitted by applicable law and the Corporation's Articles of Incorporation
hereby agrees to indemnify the Executive for his or her reasonable attorneys'
fees and disbursements incurred in such litigation, and hereby agrees to pay
any money judgment obtained from the Executive and prejudgment interest on any
money judgment obtained from the Executive.
5. Payment Obligations Absolute. The Corporation's obligation to pay the
Executive the compensation and to make the arrangements provided for herein
shall be absolute and unconditional and shall not be affected by any
circumstances, including, without limitation, any set-off, counterclaim,
recoupment, defense or other right which the Corporation may have against him
or anyone else. All amounts payable by the Corporation hereunder shall be paid
without notice or demand. Each and every payment made hereunder by the
Corporation shall be final, and the Corporation will not seek to recover all or
any part of such payment from the Executive or from whosoever may be entitled
thereto, for any reason whatsoever. The Executive shall not be obligated to
seek other employment in mitigation of the amounts payable or arrangements made
under any provision of this Agreement, and the obtaining of any such other
employment shall in no event effect any reduction of the Corporation's
obligations to make the payments and arrangements required to be made under
this Agreement.
6. Continuing Obligations. The Executive shall retain in confidence any
confidential information known to him concerning the Corporation and its
Subsidiaries and their respective businesses so long as such information is not
publicly disclosed.
7. Successors. This Agreement shall be binding upon and inure to the
benefit of the Executive and his estate and the Corporation and any successor
of the Corporation, but neither this Agreement nor any rights arising hereunder
may be assigned or pledged by the Executive.
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8. Severability. Any provision in this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective only to the extent of such prohibition or unenforceability without
invalidating or affecting the remaining provisions hereof, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
9. Prior Agreements. This Agreement supersedes any prior severance
agreement between the Executive and the Corporation, which shall be of no
further force and effect whatsoever.
10. Controlling Law. This Agreement shall in all respects be governed by
and construed in accordance with the laws of the State of Nevada.
11. Termination. This Agreement shall terminate if the Board determines
that the Executive is no longer a key executive and so notifies the Executive;
except that such determination shall not be made, and if made shall have no
effect within one (1) year after the effectuation of an Event.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
19th day of November, 1996.
STRATOSPHERE CORPORATION
By /s/ Xxxx Xxxxxx
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XXXX XXXXXX
Its: Chairman of the Board
EXECUTIVE
By /s/ Xxxxxxx Xxxxxxx
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XXXXXXX XXXXXXX
