EXHIBIT 10.1
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This agreement ("Agreement") has been entered into effective the 13th day of
March, 1995 by and between President Casinos, Inc., a Delaware corporation
("Company"), and Xxxx X. Xxxxxxxxx, an individual ("Executive").
RECITALS
The Board of Directors of the Company (the "Board"), has determined that it
is in the best interests of the Company and its stockholders to reinforce and
encourage the continued attention and dedication of the Executive to the
Company as a member of the Company's management and to assure that the Company
will have the continued dedication of the Executive, notwithstanding the
possibility, threat or occurrence of a Change in Control (as defined below) of
the Company. The Board desires to provide for the continued employment of the
Executive on the terms hereof, and the Executive is willing to commit himself
to continue to serve the Company. Additionally, the Board believes it is
imperative to diminish the inevitable distractions of the Executive by virtue
of the personal uncertainties and risks created by a pending or threatened
Change in Control, to encourage the Executive's full attention and dedication
to the Company currently and in the event of any threatened or pending Change
in Control, and to provide the Executive with compensation and benefits
arrangements upon the breach of this Agreement by the Employer or upon a
termination of employment after a Change in Control which ensure that the
compensation and benefits expectations of the Executive will be satisfied and
which are competitive with those of other corporations. Therefore, in order
to accomplish these objectives, the Board has caused the Company to enter into
this Agreement.
IT IS AGREED AS FOLLOWS:
SECTION 1. DEFINITIONS AND CONSTRUCTION.
1.1 DEFINITIONS. For purposes of this Agreement, the following words and
phrases, whether or not capitalized, shall have the meanings specified below,
unless the context plainly requires a different meaning.
1.1(a) "CASH COMPENSATION" means the Executive's Annual Base Salary (as
defined in Section 2.4(a)) plus the Incentive Bonus (as defined in Section
2.4(b)) anticipated to be awarded to the Executive in any given year.
1.1(b) "BOARD" means the Board of Directors of the Company.
1.1(c) "CHANGE IN CONTROL" means a change in control of the Company of a
nature that would be required to be reported in response to Item 6(e) of
Schedule 14A of Regulation 14A promulgated under the Exchange Act; provided
that, for purposes of this Agreement, a Change in Control shall be deemed to
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have occurred if (i) any Person (other than the Company and other than a
person who is or who controls, or is controlled by or is under common control
with Xxxx X. Xxxxxxxx or any person who is an Exempt Person as that term is
defined in the Rights Agreement of the Company dated as of November 10, 1997)
is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company which
represent 20% or more of the combined voting power of the Company's then
outstanding securities; (ii) during any period of two (2) consecutive years,
individuals who at the beginning of such period constitute the Board cease for
any reason to constitute at least a majority thereof, unless the election, or
the nomination for election, by the Company's stockholders, of each new
director is approved by a vote of at least two-thirds (2/3) of the directors
then still in office who were directors at the beginning of the period, but
excluding any individual whose initial assumption of office occurs as a result
of either an actual or threatened election contest (as such term is used in
Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other
actual or threatened solicitation of proxies or consents by or on behalf of a
person other than the Board; (iii) there is consummated any consolidation or
merger of the Company in which the Company is not the continuing or surviving
corporation or pursuant to which shares of the Company's Common Stock are
converted into cash, securities, or other property, other than a merger of the
Company in which the holders of the Company's Common Stock immediately prior
to the merger have the same proportionate ownership of common stock of the
surviving corporation immediately after the merger; (iv) there is consummated
any consolidation or merger of the Company in which the Company is the
continuing or surviving corporation in which the holders of the Company's
Common Stock immediately prior to the merger do not own fifty percent (50%) or
more of the stock of the surviving corporation immediately after the merger;
(v) there is consummated any sale, lease, exchange, or other transfer (in one
transaction or a series of related transactions) of all, or substantially all,
of the assets of the Company, or (vi) the stockholders of the Company approve
any plan or proposal for the liquidation or dissolution of the Company.
1.1(d) "CHANGE IN CONTROL DATE" shall mean the date of the Change in Control.
1.1(e) "CODE" shall mean the Internal Revenue Code of 1986, as amended.
1.1(f) "COMPANY" means President Casinos, Inc., A Delaware corporation.
1.1(g) "EMPLOYMENT PERIOD" means the period beginning on the Effective Date
and ending at the end of the TERM of this agreement.
1.1(h) "EFFECTIVE DATE" shall mean March 13, 1995 prior to June 1, 1998 and
thereafter shall mean June 1, 1998 and, if extended pursuant to 1.1(k) each
and every second June 1 thereafter.
1.1(i) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
1.1(j) "PERSON" means any "person" within the meaning of Sections 13(d) and
14(d) of the Exchange Act.
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1.1(k) "TERM" means the period that begins on the Effective Date and ends on
the earlier of: (i) the close of business five years from the Effective Date,
or (ii) the Date of Termination as defined in Section 3.6 provided, however,
the term of this Agreement shall, unless notice shall be given by any party to
the other prior to March 1, 2003, be renewed for a new two year term
commencing June 1, 2003. Its term may be extended thereafter for additional
two (2) year terms unless prior to March 1 of the year in which it expires
notice is given by either party that it is not to be extended.
1.2 GENDER AND NUMBER. When appropriate, pronouns in this Agreement used in
the masculine gender include the feminine gender, words in the singular
include the plural, and words in the plural include the singular.
1.3 HEADINGS. All headings in this Agreement are included solely for ease of
reference and do not bear on the interpretation of the text. Accordingly, as
used in this Agreement, the terms "Article" and "Section" mean the text that
accompanies the specified Article or Section of the Agreement.
1.4 APPLICABLE LAW. This Agreement shall be governed by and construed in
accordance with the laws of the state of Missouri, without reference to its
conflict of law principles.
SECTION 2: TERMS AND CONDITIONS OF EMPLOYMENT.
2.1 PERIOD OF EMPLOYMENT. Throughout the Term of this Agreement, the
Executive shall remain in the employ of the Company in accordance with the
terms and provisions of this Agreement.
2.2 POSITIONS AND DUTIES.
2.2(a) Throughout the Term of this Agreement, the Executive's position
(including status, offices, titles and reporting requirements), authority,
duties and responsibilities shall be at least commensurate in all material
respects with those assigned to, or held and exercised by, the Executive on
the Effective Date of this Agreement.
2.2(b) Throughout the Term of this Agreement (but excluding any period of
vacation and sick leave to which he is entitled), the Executive shall devote
his full business time, attention and best efforts to the business and affairs
of the Company and shall use his reasonable best efforts to perform faithfully
and efficiently such responsibilities as are assigned to him under or in
accordance with this Agreement; provided that, it shall not be a violation of
this paragraph for the Executive to (i) serve on corporate, civic or
charitable boards or committees, (ii) deliver lectures or fulfill speaking
engagements, or (iii) manage personal investments, so long as such activities
do not significantly interfere with the performance of the Executive's
responsibilities as an employee of the Company in accordance with this
Agreement.
2.3 SITUS OF EMPLOYMENT. Throughout the Term of this Agreement, the
Executive's services shall be performed at the location where the Executive
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was employed on the Effective Date, any office which is the headquarters of
the Company or any new headquarters if the Board of Directors determines to
relocate the headquarters.
2.4 COMPENSATION. The Executive's annual Compensation and other benefits
described in this Section 2.4, shall be provided by the Company.
2.4(a) ANNUAL BASE SALARY. For the year beginning March 1, 1997, the
Executive shall receive an annual base salary of four hundred thousand dollars
($400,000) which shall be paid in accordance with the regular payroll practice
of the Company. During the Term of this Agreement, the annual base salary
payable to the Executive shall be reviewed thereafter at least annually but
need not be adjusted upward as a result of such review and shall not be
reduced after any increase thereof. "Annual Base Salary" as used herein shall
mean the annual base salary for a then current year.
2.4(b) INCENTIVE BONUSES. In addition to Annual Base Salary, the Executive
shall be entitled to participate in any incentive bonuses ("Incentive
Bonuses") provided through any incentive compensation plan, which is generally
available to other peer executives of the Company. To the extent an Incentive
Bonus is to be calculated for any year pursuant to Section 4.1(b), the actual
Incentive Bonus paid to the Executive for the prior fiscal year shall be the
bonus amount. To the extent any incentive bonus is paid in shares of
restricted stock, there shall be included in an Incentive Bonus the value of
such shares on their award date without any discount; provided, however, such
restricted shares shall include only those awarded in lieu of compensation
payable, as determined by the Compensation Committee of the Board.
2.4(c) INCENTIVE, SAVINGS AND RETIREMENT PLANS. Throughout the Term of this
Agreement, the Executive shall be entitled to participate in all incentive,
savings and retirement plans generally available to other peer executives of
the Company.
2.4(d) WELFARE BENEFIT PLANS. Throughout the Term of this Agreement (and
thereafter, subject to Section 4.1(c) hereof), the Executive and/or the
Executive's family, as the case may be, shall be eligible for participation in
and shall receive all benefits under welfare benefit plans, practices,
policies and programs provided by the Company but limited however to medical,
prescription, dental, disability, employee life, group life, accidental death
and travel accident insurance plans and programs) to the extent generally
available to other peer executives of the Company.
2.4(e) EXPENSES. Throughout the Term of this Agreement, the Executive shall
be entitled to receive prompt reimbursement for all reasonable expenses
incurred by the Executive in accordance with the most favorable policies,
practices and procedures generally applicable to other peer executives of the
Company.
2.4(f) FRINGE BENEFITS. Throughout the Term of this Agreement, the Executive
shall be entitled to such fringe benefits as generally are provided to other
peer executives of the Company.
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2.4(g) OFFICE AND SUPPORT STAFF. Throughout the Term of this Agreement, the
Executive shall be entitled to an office or offices of a size and with
furnishings and other appointments, and to personal secretarial and other
assistance, at least equal to those generally provided to other peer
executives of the Company.
2.4(h) VACATION. Throughout the Term of this Agreement, the Executive shall
be entitled to paid vacation in accordance with the most favorable plans,
policies, programs and practices generally provided with respect to other peer
executives of the Company.
SECTION 3. TERMINATION OF EMPLOYMENT.
3.1 DEATH. The Executive's employment shall terminate automatically upon the
Executive's death during the Employment Period.
3.2 DISABILITY. If the Company determines that the Disability of the
Executive has occurred during the Employment Period (pursuant to the
definition of Disability set forth below), it may give to the Executive
written notice in accordance with Section 7.1 of its intention to terminate
the Executive's employment. In such event, the Executive's employment with
the Company shall terminate effective on the thirtieth (30th) day after
receipt of such notice by the Executive (the "Disability Effective Date"),
provided that, within the thirty (30) days after such receipt the Executive
shall not have returned to full-time performance of the Executive's duties.
For purposes of this Agreement, "Disability" shall mean that the Executive has
been unable to perform the material duties of his position for a period of one
hundred eighty (180) days by reason of a physical and/or mental condition
during any twelve (12) month period. "Disability" shall be deemed to exist
when certified by a physician selected by the Company or its insurers and
acceptable to the Executive or the Executive's legal representative (such
agreement as to acceptability not to be withheld unreasonably). The Executive
will submit to such examinations and tests as such physician deems necessary
to make any such Disability determination.
3.3 TERMINATION FOR CAUSE. The Company may terminate the Executive's
employment during the Employment Period for "Cause," which shall mean
termination based upon: (i) any breach or failure to perform duties or follow
instructions of the Board of Directors if not cured within thirty (30) days
after receipt of written notice of breach of failure, (ii) the Executive's
commission of fraud, misappropriation, embezzlement or other acts of
dishonesty, alcoholism, drug addiction or dependency or conviction of a felony
or gross misdemeanor if the Board of Directors determines such conduct is
materially adverse to the Company, (iii) the Executive's material breach of
any provision of this Agreement, if not cured within thirty (30) days after
written notice to Executive that a breach has occurred, (iv) based upon the
Executive testing positive for a controlled substance on three occasions, (v)
based upon the Executive failing on three occasions to pass a blood alcohol
test at the level set for being intoxicated in the State in which the test is
performed or (vi) any gaming commission with jurisdiction over a facility
owned, operated or managed by the Company which requires Executive's
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licensure, refuses or fails within a reasonable period of time to grant a
license to Executive or suspends or revokes a license granted to Executive.
Notwithstanding the foregoing, the Executive shall not be deemed to have been
terminated for Cause unless and until he receives a Notice of Termination (as
defined in Section 3.5) from the Chairman of the Compensation Committee of the
Board.
3.4 GOOD REASON. The Executive may terminate his employment with the Company
for "Good Reason," which shall mean termination based upon:
(i) a significant and adverse change in the nature or scope of position,
authority, duties or responsibility;
(ii) (a) the failure by the Company to continue in effect any material (i)
benefit or compensation plan, (ii) stock ownership plan, (iii) life insurance
plan, (iv) health and accident plan or (v) disability plan to which the
Executive is entitled as specified in Section 2.4, (b) the taking of any
action by the Company which would adversely affect the Executive's
participation in, or materially reduce the Executive's benefits under, any
plans described in Section 2.4, or deprive the Executive of any material
fringe benefit enjoyed by the Executive as described in Section 2.4(f), or (c)
the failure by the Company to provide the Executive with the number of paid
vacation days to which the Executive is entitled as described in Section
2.4(h); provided, however, if the Company discontinues one of the foregoing on
a Company wide or executive level basis, such action shall not constitute Good
Reason.
(iii) a material breach by the Company of any provision of this Agreement
which has not been cured within thirty (30) days after receipt of written
notice of such material breach;
(iv) within a period ending at the close of business on the date one (1) year
after the Change in Control Date, the Executive, in his sole and absolute
discretion, determines and notifies the Company in writing, that he does not
wish to continue his employment with the Company.
3.5 NOTICE OF TERMINATION. Any termination by the Company for Cause or
Disability, or by the Executive for Good Reason, shall be communicated by
Notice of Termination to the other party, given in accordance with Section 7.1
For purposes of this Agreement, a "Notice of Termination" means a written
notice which (i) indicates the specific termination provision in this
Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination
of the Executive's employment under the provision so indicated, and (iii) if
the Date of Termination (as defined below) is other than the date of receipt
of such notice, specifies the termination date (which date shall be not more
than fifteen (15) days after the giving of such notice). The failure by the
Executive or the Company to set forth in the Notice of Termination any fact or
circumstance which contributes to a showing of Good Reason or Cause shall not
waive any right of the Executive or the Company hereunder or preclude the
Executive or the Company from asserting such fact or circumstance in enforcing
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the Executive's or the Company's rights hereunder.
3.6 DATE OF TERMINATION. "Date of Termination" means (i) if the Executive's
employment is terminated by the Company for Cause, the Date of Termination
shall be the date of receipt of the Notice of Termination or any later date
specified therein, as the case may be, (ii) if the Executive's employment is
terminated by him for Good Reason as provided in Section 3.4 hereof, the Date
of Termination shall be the date on which the Company receives notice from the
Executive of termination, (iii) if the Executive's employment is terminated by
reason of death or Disability, the Date of Termination shall be the date of
death of the Executive or the Disability Effective Date, as the case may be,
or (iv) if the Executive's employment is terminated by the Company other than
for Cause, death, or Disability, the Date of Termination shall be the date of
receipt of the Notice of Termination.
SECTION 4. CERTAIN BENEFITS UPON TERMINATION.
4.1 TERMINATION WITHOUT CAUSE OR FOR GOOD REASON PRIOR TO A CHANGE IN
CONTROL. If, prior to a Change in Control, during the Employment Period: (i)
the Company shall terminate the Executive's employment without Cause, or (ii)
the Executive shall terminate employment with the Company for Good Reason, the
Executive shall be entitled to the benefits provided below:
4.1(a) "Accrued Obligations": On the twentieth (20th) business day following
the Date of Termination, the Company shall pay to the Executive the sum of (1)
the Executive's Annual Base Salary through the Date of Termination to the
extent not previously paid, (2) any compensation previously deferred by the
Executive (together with any accrued interest or earnings thereon), (3) any
accrued vacation pay; in each case to the extent not previously paid, and in
the event of a termination pursuant to Section 4.1, 4.2, 4.3 or 4.4 hereof
(and excluding any termination pursuant to Section 4.5) part or all of the
Incentive Bonus earned or banked for the year in which the Date of
Termination.
4.1(b) "Annual Base Salary Continuation": For the remainder of the
Employment Period, the Company shall pay on a monthly basis to the Executive,
the Executive's then-current Annual Base Salary and an Executive Incentive
Bonus over a period of twelve (12) months, each as would have been paid to the
Executive had the Executive remained in the Company's employ throughout the
Employment Period, provided, however, such amount shall not exceed (a) two
times the Executive's Annual Base Salary plus (b) two times the Executive's
Incentive Bonus calculated pursuant to Section 2.4(b) nor shall it be less
than (a) one times the Executive's Annual Base Salary plus (b) one times the
Executive's Incentive Bonus calculated pursuant to Section 2.4(b). The
Company at any time may elect to pay the balance of such payments then
remaining in a lump sum, in which case the total of such payments shall be
discounted to present value as determined according to Code Section
280G(d)(4).
4.1(c) "Welfare Benefit Continuation": For twenty-four (24) months following
the Date of Termination, the Company shall continue benefits to the Executive
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and/or the Executive's family at least equal to those which would have been
provided to them in accordance with the plans, programs, practices and
policies described in Section 2.4(d) if the Executive's employment had not
been terminated, in accordance with the most favorable plans, practices,
programs or policies of the Company as those provided generally to other peer
executives and their families during the ninety (90) day period immediately
preceding the Effective Date or, if more favorable to the Executive, as those
provided generally at any time after the Effective Date to other peer
executives of the Company and their families; provided, however, that if the
Executive becomes reemployed with another employer and is eligible to receive
medical or other welfare benefits under another employer-provided plan, the
medical and other welfare benefits described herein shall cease.
4.1(d) "Other Benefits": To the extent not previously paid or provided, the
Company shall timely pay or provide to the Executive and/or the Executive's
family any other vested amounts or vested benefits required to be paid or
provided for which the Executive and/or the Executive's family is eligible to
receive pursuant to this Agreement and under any plan, program, policy or
practice or contract or agreement of the Company as those provided generally
to other peer executives and their families during the ninety (90) day period
immediately preceding the Effective Date or, if more favorable to the
Executive, as those provided generally after the Effective Date to other peer
executives of the Company and their families.
4.1(e) The provisions of Section 5 shall apply in the event of any
termination pursuant to this Section 4.1.
4.1(f) Pursuant to this Section 4.1(f), the Executive shall not be required
to mitigate the amount of any payment provided for in this Section by seeking
other employment or otherwise, nor shall the amount of any payment provided
for in this Section be reduced by any compensation earned by the Executive as
the result of employment by another employer after the Date of Termination, or
otherwise other than pursuant to Section 4.1(c).
4.2 BENEFITS UPON TERMINATION AFTER A CHANGE IN CONTROL. If a Change in
Control occurs during the Employment Period and within two (2) years after a
Change in Control: (i) the Company shall terminate the Executive's employment
without Cause, or (ii) the Executive shall terminate employment with the
Company for Good Reason, then the Executive shall be entitled to the benefits
provided below:
4.2(a) "Accrued Obligations": On the twentieth (20th) business day following
the Date of Termination, the Company shall pay to the Executive the sum of (1)
the Executive's Annual Base Salary through the Date of Termination to the
extent not previously paid, (2) any compensation previously deferred by the
Executive (together with any accrued interest or earnings thereon) and (3) any
accrued vacation pay; in each case to the extent not previously paid. No
amount shall be paid as Annual Base Salary for any period following the Date
of Termination.
4.2(b) "Severance Amount": On the twentieth (20th) business day following
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the Date of Termination, the Company shall pay Executive a lump sum amount, in
cash, equal to 2.99 times the Executive's "base amount." For purposes of this
paragraph, base amount means the annualized includible compensation for the
period consisting of the most recent five taxable years ending before the date
on which the Change in Control occurred (or such portion of such period during
which the Executive performed personal services for the Company), as defined
and interpreted for purposes of Section 280G of the Internal Revenue Code of
1986, as such section may be amended from time to time.
4.2(c) "Welfare Benefit Continuation": For two years after the Executive's
Date of Termination, or such longer period as may be provided by the terms of
the appropriate plan, program, practice or policy, the Company shall continue
benefits to the Executive and/or the Executive's family at least equal to
those which would have been provided to them in accordance with the plans,
programs, practices and policies described in Section 2.4(d) of this Agreement
if the Executive's employment had not been terminated or, if more favorable to
the Executive, as in effect generally at any time thereafter with respect to
other peer executives of the Company and its affiliated companies and their
families, provided, however, that if the Executive becomes reemployed with
another employer and is eligible to receive medical or other welfare benefits
under another employer provided plan, the medical and other welfare benefits
described herein shall be secondary to those provided under such other plan
during such applicable period of eligibility.
4.2(d) "Other Benefits": To the extent not previously paid or provided, and
for a period ending on the second anniversary of the Date of Termination, the
Company shall timely pay or provide to the Executive and/or the Executive's
family any vested other amounts or vested benefits required to be paid or
provided for which the Executive and/or the Executive's family is eligible to
receive pursuant to this Agreement and under any plan, program, policy or
practice or contract or agreement of the Company applicable to the Executive
and for his family as well as those provided generally to other peer
executives and their families during the ninety (90) day period immediately
preceding the Effective Date or, if more favorable to the Executive, as those
provided generally after the Effective Date to other peer executives of the
Company and their families.
4.2(e) "Certain Additional Payments by the Company":
(i) Anything in this Agreement to the contrary notwithstanding, in the event
(A) it shall be determined that any payment or distribution by the Company to
or for the benefit of the Executive (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise) (a
"Payment") would be subject to the excise tax imposed by Code Section 4999, or
(B) any interest or penalties are incurred by the Executive with respect to
such excise tax (such excise tax, together with any interest and penalties,
are hereinafter collectively referred to as the "Excise Tax"), then the
Executive shall be entitled to receive an additional payment (a "Gross-Up
Payment") in an amount equal to the Excise Tax imposed on the Payment and on
the Gross-Up Payment as well as any additional income tax, employment tax and
Excise Tax payable with respect to such additional payment (including any
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interest or penalties imposed with respect to such Excise Tax). The Gross-Up
Payment shall not include any amount for the payment of any income or
employment taxes imposed on the Payment, but shall include any income or
employment taxes payable with respect to any Gross-Up Payment (and any
interest and penalties imposed with respect thereto).
(ii) Subject to the provisions of Section 4.2(e)(iii), all determinations
required to be made under this Section, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up Payment and the
assumptions to be utilized in arriving at such determination, shall be made by
an independent accountant which shall provide detailed supporting calculations
both to the Company and the Executive within fifteen (15) business days of the
receipt of notice from the Executive that there has been a Payment, or such
earlier time as is requested by the Company. All fees and expenses of the
independent accountant shall be borne solely by the Company. Any Gross-Up
Payment, as determined pursuant to this Section 4.2(e), shall be paid by the
Company to the Executive within five (5) days of the receipt of the
independent accountant's determination. If the independent accountant
determines that no Excise Tax is payable by the Executive, it shall furnish
the Executive with a written opinion that failure to report the Excise Tax on
the Executive's applicable Federal income tax return would not result in the
imposition of a negligence or similar penalty. Any determination by the
independent accountant shall be binding upon the Company and the Executive.
As a result of the uncertainty in the application of Code Section 4999 at the
time of the initial determination by the independent accountant hereunder, it
is possible that Gross-Up Payments which will not have been made by the
Company should have been made ("Underpayment"), consistent with the
calculations required to be made hereunder. In the event that the Company
exhausts its remedies pursuant to Section 4.2(e)(iii) and the Executive
thereafter is required to make a payment of any Excise Tax, the independent
accountant shall determine the amount of the Underpayment that has occurred
and any such Underpayment, as well as any interest and penalties imposed
thereon, shall be promptly paid by the Company to or for the benefit of the
Executive.
(iii) The Executive shall notify the Company in writing of any claim by the
Internal Revenue Service that, if successful, would require the payment by the
Company of the Gross-Up Payment. Such notification shall be given as soon as
practicable but no later than ten (10) business days after the Executive is
informed in writing of such claim and shall apprise the Company of the nature
of such claim and the date on which such claim is requested to be paid. The
Executive shall not pay such claim prior to the expiration of the thirty (30)
day period following the date on which the Executive gives such notice to the
Company (or such shorter period ending on the date that any payment of taxes
with respect to such claim is due). If the Company notifies the Executive in
writing prior to the expiration of such period that it desires to contest such
claim, the Executive shall:
(a) give the Company any information reasonably requested by the Company
relating to such claim,
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(b) take such action in connection with contesting such claim as the Company
shall reasonably request in writing from time to time, including without
limitation, accepting legal representation with respect to such claim by an
attorney reasonably selected by the Company,
(c) cooperate with the Company in good faith in order to effectively contest
such claim, and
(d) permit the Company to participate in any proceedings relating to such
claim; provided, however, that the Company shall bear and pay directly all
costs and expenses (including additional interest and penalties) incurred in
connection with such contest and shall indemnify and hold the Executive
harmless, on an after-tax basis, for any Excise Tax or income tax (including
interest and penalties with respect thereto) imposed as a result of such
representation and payment of costs and expenses. Without limitation on the
foregoing provisions of this Section 4.2(e), the Company shall control all
proceedings taken in connection with such contest and, at its sole option, may
pursue or forego any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its
sole option, either direct the Executive to pay the tax claimed and xxx for a
refund or contest the claim in any permissible manner, and the Executive
agrees to prosecute such contest to a determination before any administrative
tribunal, in a court of initial jurisdiction and in one or more appellate
courts, as the Company shall determine; provided, however, that if the Company
directs the Executive to pay such claim and xxx for a refund, the Company
shall advance the amount of such payment to the Executive, on an interest-free
basis and shall indemnify and hold the Executive harmless, on an after-tax
basis, from any Excise Tax or income tax (including interest or penalties with
respect thereto) imposed with respect to such advance or with respect to any
imputed income with respect to such advance; and further provided that any
extension of the statute of limitations relating to payment of taxes for the
taxable year of the Executive with respect to which such contested amount is
claimed to be due is limited solely to such contested amount. Furthermore,
the Company's control of the contest shall be limited to issues with respect
to which a Gross-Up Payment would be payable hereunder and the Executive shall
be entitled to settle or contest, as the case may be, any other issue raised
by the Internal Revenue Service or any other taxing authority.
(iv) If, after the receipt by the Executive of an amount advanced by the
Company pursuant to Section 4.2(e)(iii), the Executive becomes entitled to
receive any refund with respect to such claim, the Executive shall (subject to
the Company's compliance with the requirements of Section 4.2(e)(iii))
promptly pay to the Company the amount of such refund (together with any
interest paid or credited thereon after taxes applicable thereto). If, after
the receipt by the Executive of an amount advanced by the Company pursuant to
Section 4.2(e)(iii), a determination is made that the Executive shall not be
entitled to any refund with respect to such claim and the Company does not
notify the Executive in writing of its intent to contest such denial or refund
prior to the expiration of thirty (30) days after such determination, then
such advance shall be forgiven and shall not be required to be repaid and the
amount of such advance shall offset, to the extent thereof, the amount of
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Gross-Up Payment required to be paid.
4.2(f) The provisions of Section 5.2 shall apply in the event of any
termination pursuant to this Section 4.2.
4.2(g) Pursuant to this Section 4.2(g), the Executive shall not be required
to mitigate the amount of any payment provided for in this Section by seeking
other employment or otherwise, nor shall the amount of any payment provided
for in this Section be reduced by any compensation earned by the Executive as
the result of employment by another employer after the Date of Termination, or
otherwise other than pursuant to Section 4.2(c).
4.3 DEATH. If the Executive's employment is terminated by reason of the
Executive's death during the Employment Period (either prior or subsequent to
a Change in Control), this Agreement shall terminate without further
obligations to the Executive's legal representatives under this Agreement,
other than for (i) payment of Accrued Obligations which have vested (as
defined in Section 4.1(a)) (which shall be paid to the Executive's estate or
beneficiary, as applicable, in a lump sum in cash within twenty (20) days of
the Date of Termination) and (ii) the timely payment or provision of Other
Benefits which have vested (as defined in Section 4.1(d)), including death
benefits pursuant to the terms of any plan, policy, or arrangement of the
Company.
4.4 DISABILITY. If the Executive's employment is terminated by reason of the
Executive's Disability during the Employment Period (either prior or
subsequent to a Change in Control), this Agreement shall terminate without
further obligations to the Executive, other than for (i) payment of Accrued
Obligations (as defined in Section 4.1(a)) (which shall be paid to the
Executive in a lump sum in cash within twenty (20) days of the Date of
Termination) and (ii) the timely payment or provision of Other Benefits which
have vested (as defined in Section 4.1(d)) including disability benefits
pursuant to the terms of any plan, policy or arrangement of the Company. The
provisions of Section 5.1 and 5.2 shall apply in the event of termination
hereunder.
4.5 TERMINATION FOR CAUSE; OTHER THAN GOOD REASON. If the Executive's
employment shall be terminated for Cause during the Employment Period (either
prior or subsequent to a Change in Control), this Agreement shall terminate
without further obligations to the Executive other than the obligation to pay
to the Executive Accrued Obligations (as defined in Section 4.1(a)). If the
Executive terminates employment with the Company during the Employment Period,
(excluding a termination for Good Reason), this Agreement shall terminate
without further obligations to the Executive, other than for Accrued
Obligations (as defined in Section 4.1(a)). In such case, all Accrued
Obligations shall be paid to the Executive in a lump sum in cash within thirty
(30) days of the Date of Termination. If the Executive's employment shall
terminate for the reasons stated in this Section, the provisions of Section 5
shall continue to apply.
4.6 NON-EXCLUSIVITY OF RIGHTS. Except as provided in Sections 4.1(c) nothing
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in this Agreement shall prevent or limit the Executive's continuing or future
participation in any plan, program, policy or practice provided by the Company
and for which the Executive may qualify, nor shall anything herein limit or
otherwise affect such rights as the Executive may have under any contract or
agreement with the Company. Amounts which are vested benefits of which the
Executive is otherwise entitled to receive under any plan, policy, practice or
program of, or any contract or agreement with, the Company at or subsequent to
the Date of Termination, shall be payable in accordance with such plan,
policy, practice or program or contract or agreement except as explicitly
modified by this Agreement.
4.7 FULL SETTLEMENT. The Company's obligation to make the payments provided
for in this Agreement and otherwise to perform its obligations hereunder shall
not be affected by any set-off, counterclaim, recoupment, defense or other
claim, right or action which the Company may have against the Executive or
others other than an obligation on the part of the Executive to repay money
borrowed from the Company. The Company agrees to pay to the full extent
permitted by law, all legal fees and expenses which the Executive may
reasonably incur as a result of any contest by the Company, the Executive or
others of the validity or enforceability of, or liability under, any provision
of this Agreement or any guarantee of performance thereof (including as a
result of any contest by the Executive regarding the amount of any payment
pursuant to this Agreement) provided, however, in the event the Executive is
unsuccessful in enforcing a contractual right at issue no such reimbursement
shall be made and, further provided, Executive shall reimburse Company for its
reasonable legal fees if any claim by the Executive is found frivolous.
4.8 OTHER TERMINATION. If the Company shall terminate Executive's employment
other than for Cause, Executive's employment shall terminate but all other
terms hereof including payments of Cash Compensation shall continue as
provided herein. If Executive shall terminate prior to a Change in Control
other than for Good Reason, Executive's employment shall terminate but the
provisions of Section 5 shall continue to apply.
SECTION 5: NON-COMPETITION WITH AND SERVICES FOR THE COMPANY.
5.1 NON-COMPETE AGREEMENT.
5.1(a) It is agreed that either: (i) during the Term of this Agreement and
for a period ending one (1) year thereafter; or (ii) if the Executive's
employment is terminated during the Term of this Agreement, then until the
date one (1) year after the date of termination, the Executive shall not,
without prior written approval of the Board, become an officer, employee,
agent, partner, consultant or director of any business enterprise in
substantial direct competition (as defined in Section 5.1(b)) with the
Company.
5.1(b) For purposes of Section 5.1, a business enterprise with which the
Executive becomes associated as an officer, employee, agent, partner,
consultant or director shall be considered in substantial direct competition,
if such entity competes with the Company in any business in which the Company
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is engaged and is within the Company's market area (as defined herein) as of
the Date of Termination. The Company's market area is defined for this
purpose, as the area which constitutes the St. Louis, Missouri metropolitan
area the Davenport, Iowa metropolitan area and the Biloxi, Mississippi
metropolitan area, and (a) if the Company becomes the successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) after the
Effective Date, to all or substantially all of the business and/or assets of
another business enterprise, the geographical areas in which such predecessor
business enterprise conducts substantial business activity b) any other
metropolitan area where the Company is conducting gaming operations under an
effective gaming license and (c) any metropolitan area with respect to which
the Company has expended more than five hundred thousand dollars ($500,000) in
development costs. In no event shall an asserted violation of the provisions
of this Section constitute a basis for deferring or withholding any amounts
otherwise payable to the Executive under this Agreement except that in the
event that prior to a Change in Control the Company, in its reasonable and
good faith judgment, believes that a violation of such provision has occurred
and the Company brings a judicial proceeding to enforce such provision against
the Executive in which event amounts may be deferred pending an outcome of
such proceeding.
5.2 CONFIDENTIAL INFORMATION. The Executive shall hold in a fiduciary
capacity for the benefit of the Company all secret or confidential
information, knowledge or data relating to the Company or any of its
affiliated companies, and their respective businesses, which shall have been
obtained by the Executive during the Executive's employment by the Company and
which shall not be or become public knowledge (other than by acts by the
Executive or representatives of the Executive in violation of this Agreement).
After termination of the Executive's employment with the Company, the
Executive shall not, without the prior written consent of the Company, or as
may otherwise be required by law or legal process, communicate or divulge any
such information, knowledge or data to anyone other than the Company and those
designated by it. In no event shall an asserted violation of the provisions
of this Section constitute a basis for deferring or withholding any amounts
otherwise payable to the Executive under this Agreement except that in the
event that prior to a Change in Control the Company, in its reasonable and
good faith judgment, believes that a violation of such provision has occurred
and the Company brings a judicial proceeding to enforce such provision against
the Executive in which event amounts may be deferred pending an outcome of
such proceeding. The Executive and the Company agree that neither of them
shall disclose information of a derogatory nature about the other, that the
Executive shall return all Company property in his possession on termination
of employment, and that this Section 5.2 shall remain binding notwithstanding
termination of employment for any reason. The parties agree that damages are
an insufficient remedy if a party has breached the terms of this Section 5.2
and that a request for equitable relief is permitted.
5.3 SERVICES FOLLOWING A CHANGE IN CONTROL. If a Change in Control of the
Company shall occur and the Executive shall receive the payment provided in
section 4.2 hereof, then following the Date of Termination, and for a period
of six months thereafter or as long as payments are being made hereunder, the
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Executive shall make himself available for no additional payment other than
his reasonable expenses incurred in the performance of his duties hereunder at
such reasonable times and places as shall be set forth in writing by notice
from the Chief Executive Officer of the Company to him to perform such
reasonable services as may be requested in writing of him. No services
hereunder shall be required on a "full time" basis. The Executive's services
shall not be required for more than two (2) hours on any day and on not more
than three (3) days per month. Any successor employer must consent to each
request for services and Executive shall use his best efforts to obtain such
consent.
5.4 MODIFICATION. If any court of competent jurisdiction determines that,
consistent with the established precedent of the forum of jurisdiction, any
restriction contained in Section 5.1 of this Agreement is unenforceable or
unreasonable, a lesser restriction shall be enforced in its place to the
maximum extent deemed enforceable or reasonable, and the remaining covenants
and restrictions shall be enforceable independently of each other.
SECTION 6: SUCCESSORS.
6.1 SUCCESSORS OF EXECUTIVE. This Agreement is personal to the Executive,
and without the prior written consent of the Company, amounts receivable
hereunder shall not be assignable by the Executive otherwise than by will or
the laws of descent and distribution. This Agreement shall inure to the
benefit of and be enforceable by the Executive's legal representatives.
6.2 SUCCESSORS OF COMPANY. The Company will require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the
same extent that the Company would be required to perform it if no such
succession had taken place. As used in this Agreement, "Company" shall mean
the Company as herein before defined and any successor to its business and/or
assets which assumes and agrees to perform this Agreement by operation of law,
or otherwise.
SECTION 7: MISCELLANEOUS.
7.1 NOTICE. For purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by certified or
registered mail, return receipt requested, postage prepaid, addressed to the
respective addresses as set forth below; provided that all notices to the
Company shall be directed to the attention of the President of the Company
with a copy to the Secretary of the Company, or to such other address as one
party may have furnished to the other in writing in accordance herewith,
except that notice of change of address shall be effective only upon receipt.
Notice to Executive:
Xxxx X. Xxxxxxxxx
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232 N. Kingshighway
Park Plaza, Apartment 618
St. Louis, Missouri 63108
Notice to Company:
President Casinos, Inc.
000 Xxxxx Xxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attn: Chairman of the Board
7.2 VALIDITY. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
7.3 WITHHOLDING. The Company may withhold from any amounts payable under
this Agreement such Federal, state or local taxes as shall be required to be
withheld pursuant to any applicable law or regulation.
7.4 WAIVER. The Executive's or the Company's failure to insist upon strict
compliance with any provision hereof or any other provision of this Agreement
or the failure to assert any right the Executive or the Company may have
hereunder, including, without limitation, the right of the Executive to
terminate employment for Good Reason pursuant to Section 3.4 shall not be
deemed to be a waiver of such provision or right or any other provision or
right of this Agreement.
7.5 REPLACEMENT OF PRIOR AGREEMENT. This Agreement supersedes and replaces
the Agreement between the undersigned dated March 13, 1995.
IN WITNESS WHEREOF, the Executive and, the Company, pursuant to the
authorization from its Board, have caused this Agreement to be executed in its
name on its behalf, all as of the day and year first above written on June 26,
1998.
/s/ Xxxx X. Xxxxxxxxx
----------------------------------
XXXX X. XXXXXXXXX
PRESIDENT CASINOS, INC.
By /s/ Xxxx X. Xxxxxxxx
--------------------------------
Name: XXXX X. XXXXXXXX
Title: Chairman of the Board
