Exhibit 10.81
Xxxxxxx Agreement
-5-
AMENDMENT
THIS AMENDMENT, dated as of March 23, 1999, is between
Players International, Inc. (together with its successors and
assigns, the "Company") and Xxxxxxx Xxxxxxx, Xx. ("Executive").
W I T N E S S E T H:
WHEREAS, the Company and Executive are parties to an
Employment Agreement dated as of March 31, 1997 as amended by
Amendments dated as of August 31, 1998 and November 12, 1998 (the
"Employment Agreement"); and
WHEREAS, the Company, Jackpot Enterprises, Inc. and JEI
Merger Corp. are parties to an Agreement and Plan of Merger dated
as of February 8, 1999 (the "Merger Agreement"), Section 5.11(d)
of which calls for the resignation of Executive as of the
effective date of the merger contemplated by the Merger Agreement
(the "Merger");
WHEREAS, the Executive and the Company, with the consent of
Jackpot Enterprises, Inc. and JEI Merger Corp. wish to accelerate
the effective date of Executive's resignation to April 7, 1999,
while preserving Executive's right to receive the compensation
and benefits to which he would have been entitled had his
employment continued through the effective date of the Merger;
and
WHEREAS, the Company and Executive now wish to amend the
Employment Agreement to memorialize the arrangements that will
apply to Executive's Termination of Employment from the Company.
NOW, THEREFORE, in consideration of the premises and mutual
covenants contained herein and for other good and valuable
consideration, the Company and Executive agree to amend the
Employment Agreement as follows:
1. The following new definition is added at the end of
Paragraph 1:
"(n) "Termination by Mutual Consent in Anticipation of
a Change in Control" shall mean Executive's termination of
employment from the Company in anticipation of the consummation
of a merger transaction, with the consent of all parties to the
operative merger agreement."
2. Paragraph 9(c) is amended in its entirety to read as
follows:
(a)
(b)
(c) Termination Without Cause; Constructive
Termination without Cause; Termination by Mutual
Consent in Anticipation of a Change in Control. In the
event Executive's employment is terminated by the
Company without Cause (which shall not include a
termination pursuant to Paragraph 9(a) or 9(d)) or in
the event of a Constructive Termination Without Cause,
or in the event of a Termination by Mutual Consent in
Anticipation of a Change in Control, Executive, upon
executing and not revoking a release of the Company as
to all matters arising in the course of his employment
by the Company and the termination thereof, in the form
attached as Exhibit A to this Amendment, shall be
entitled to receive:
(i) unpaid Base Compensation earned or
accrued through his date of termination and an
additional payment equal to the payments of Base
Compensation that would have been made over the
six month period immediately following termination
of employment, had Executive's employment with the
Company continued, at the rate in effect at the
time of his termination, in a cash lump-sum, not
later than three (3) days following the later of
termination of Executive's employment or
expiration of the Revocation Period provided for
in paragraph 1(a) of the Release annexed hereto as
Exhibit A;
(ii) a lump sum cash payment representing
the balance of your annual performance bonus for
the Company's fiscal year ended March 31, 1999, in
an agreed amount of $25,000, at the same time as
the payment made under clause (i) above;
(iii) reimbursement for expenses incurred
but not yet reimbursed by the Company pursuant to
Paragraph 8, promptly following submission of
request for same;
(iv) the immediate vesting of all stock
options held by Executive, notwithstanding the
terms of any such grant to the contrary, with the
ability to exercise any such options for 12 months
following the date of termination or, if there is
a Pre-October 1999 Agreement, as hereinafter
defined, for such longer or shorter period as is
provided in Section 9(d) hereof, but in no event
after the fifth anniversary of the date of grant;
and
(v) for a period of six months following
termination of employment (or for any longer
period provided under Paragraph 9(d) of the
Employment Agreement, as herein amended, (the
"Continuation Period")), continued payment or
provision of all executive medical, dental and
long-term disability benefits to which he would
have been entitled had his employment with the
Company continued (provided, however, that in the
event the Company is precluded from providing
coverage under any such program by applicable law
or regulation, it may choose to provide Executive
with a payment equal to the Company's cost of such
coverage, without regard to tax effect (a "Benefit
Commutation Payment")). The Company shall provide
Executive with continuation coverage rights under
the Federal Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended, which
shall commence, as applicable, on (i) October 6,
1999, (ii) such earlier date as the Company shall
have made a Benefit Commutation Payment to
Executive, or (iii) notwithstanding clause (ii)
above, if a Completed Change in Control
Transaction occurs, as hereinafter defined, upon
the expiration of the period for which continued
Employee Benefits are required to be provided
under Paragraph 9(d) of Executive's Employment
Agreement, or on such earlier date as the Company
shall have made a Benefit Commutation Payment with
respect to such Paragraph 9(d) benefits.
Notwithstanding the foregoing, Executive agrees
that upon a Change in Control (as defined in the
Employment Agreement), the Company may, if
required by the Change in Control agreement,
require that Executive surrender for cancellation
all of Executive's outstanding options in exchange
for a cash payment equal to the amount (if any) by
which the Change in Control Price of the stock
underlying Executive's options exceeds the
applicable option price, and, in that event, all
such options will be canceled (without regard to
whether the fair market value of the stock exceeds
the option price at such time).
3. Paragraph 9(d) is amended by adding a new paragraph to
the end to read as follows:
If Executive's employment terminates by reason of
a Termination by Mutual Consent in Anticipation of a
Change in Control pursuant to Paragraph 9(c) and the
Merger thereafter occurs, or if such Merger is not
consummated and the Company has entered into a
definitive merger agreement on or before September 30,
1999 to effect a Change in Control transaction with a
party which received active consideration by the Board
before April 7, 1999 (a "Pre-October 1999 Agreement"),
a list of which parties is attached on Exhibit B to
this Agreement, the consummation of any such Change in
Control (a "Completed Change in Control Transaction")
shall be considered a "Termination Upon a Change in
Control" for purposes of this Agreement, and Executive
shall be entitled to receive the payments and benefits
described in this Paragraph 9(d) upon the Change in
Control. The payments and benefits described in this
Paragraph 9(d) shall be provided promptly following the
consummation of the Change in Control and, unless
otherwise agreed by the parties in writing, shall be
determined by reference to the benefit that would have
been paid assuming a Termination Upon a Change in
Control had occurred on April 7, 1999. Any amounts
previously paid to Executive upon his termination of
employment under Paragraph 9(c)(i) relating to periods
following his termination of employment, or under
Paragraph (9)(c)(v) relating to continuation of certain
benefits, shall be credited against the payments to be
made under this Paragraph 9(d). For purposes of
subparagraph (v) of this Paragraph 9(d) and
subparagraph (iv) of Paragraph 9(c) above, all of
Executive's outstanding stock options shall,
notwithstanding any provision of the option agreements
to the contrary, continue in effect and Executive
shall, unless such options are sooner canceled in
accordance with the provisions of the Merger Agreement
(or any similar provision of any other merger
agreement), have the ability to exercise his
outstanding stock options until the date which is 12
months following the Change in Control, but in no event
shall the options remain in effect after the fifth
anniversary of the date of grant.
4. The Company shall extend to Executive the benefits of
Section 5.9 of the Merger Agreement, provided the Merger occurs.
If the Merger does not occur and a Pre-October 1999 Agreement is
hereafter entered into and a merger pursuant to such agreement
occurs, the Company shall extend to Executive the benefits of any
provision that is included in such Pre-October 1999 Agreement
that is similar to Section 5.9 of the Merger Agreement. The
Company agrees that it will continue to advance promptly to
Executive, following his termination of employment from the
Company, all amounts reasonably incurred by Executive for
attorney's fees and expenses in defending any and all civil,
criminal, administrative or investigative actions, suits or
proceedings, including grand jury proceedings, related to the
Company's development and operation of riverboat casino complexes
in Louisiana ("Proceedings"), until the final disposition of such
Proceedings, in each case subject to Executive's Undertaking
dated June 16, 1998 (the "Undertaking") to repay to the Company
amounts so advanced in accordance with the terms thereof and
Executive agrees to cooperate fully, at reasonable times and
subject to reimbursement from the Company of all related
expenses, with the Company and any governmental authority
regarding the Proceedings until the final disposition of the
Proceedings. The Company represents that the Executive has been
debriefed by Company's outside counsel regarding all of his
activities from January 1993 to date in connection with the
Louisiana Riverboat Casino Complexes. The Company represents and
warrants that, as of the date of this Amendment, (i) it has no
knowledge that any wrongful acts have been committed by Executive
and (ii) it has not filed, asserted or commenced any complaints,
claims, actions or proceedings of any kind against Executive with
any federal, state or local court, or with any administrative,
regulatory or arbitration agency or body. The Company further
agrees that it will not file, assert or commence any complaint,
claim, action or proceeding of any kind against Executive with
any federal, state or local court with or any administrative,
regulatory or arbitration agency or body with respect to any
matter from the beginning of the world to the date of his
termination of employment, other than to enforce its rights under
the provisions of the Release, the Undertaking, the Amendment or
the Employment Agreement. The foregoing provisions of this
Paragraph 4 shall be in addition to and shall in no way limit any
rights which Executive may have under (i) Nevada Revised
Statutes, Title 7, Chapter 78.751, (ii) Article IX of the
Company's By-laws, (iii) the Employment Agreement, (iv) the
Undertaking, (v) the Merger Agreement, and (vi) directors' and
officers' and all other liability insurance policies maintained
by the Company.
5. Executive shall continue to make himself reasonably
available to the Company for a period of one year from
Executive's termination of employment to advise on transition
matters as to which Executive has knowledge; provided however
that (i) Executive's services shall not exceed 15 hours per month
and (ii) Executive may provide such services at reasonable times
so as not to interfere with his obligations resulting from
employment or self-employment activities following his
termination of employment from the Company. In consideration of
the performance by the Company of its obligations under this
Agreement, Executive agrees to provide such services without
additional compensation from the Company; provided, however, that
the Company shall reimburse Executive for his reasonable out-of-
pocket expenses incurred in the performances of services rendered
hereunder.
6. Defined terms used in this Amendment and not otherwise
defined shall have the same meanings as set forth in the
Employment Agreement.
7. In all respects not amended, the Employment Agreement
is hereby ratified and confirmed, including, without limitation,
Paragraphs 9 through 22 thereof, inclusive.
IN WITNESS WHEREOF, the undersigned have executed this
Amendment as of the date first above written.
PLAYERS INTERNATIONAL, INC.
Xxxxxx X. Xxxxxxxx
Chief Executive Officer
Xxxxxxx Xxxxxxx, Xx.
AGREED AND ACCEPTED: JACKPOT ENTERPRISES, INC.
By: Xxx X. Xxxxxxxxx
Its: Chief Executive Officer
JEI MERGER CORP.
By: Xxx X. Xxxxxxxxx
Its: Chief Executive Officer
Exhibit A
RELEASE AGREEMENT
1. Representation by Counsel/Revocation. (a) By executing
this Release, Executive acknowledges that: (i) he has been
advised by the Company to consult with an attorney before
executing this Agreement and has consulted and been represented
by the law firm of Xxxxxxx Xxxx & Xxxxxxxxx in connection
therewith; (ii) he has been provided with at least a twenty-one
(21) day period to review and consider whether to sign this
Agreement and that by executing and delivering this Agreement to
the Company, he is waiving any remaining portion of such twenty-
one (21) day period; and (iii) he has been advised that he has
seven (7) days following execution to revoke it (such seven day
period being the "Revocation Period").
(b) This Agreement will not be effective or
enforceable until the Revocation Period has expired. Such
revocation shall only be effective if an originally executed
written notice thereof is delivered to the Company on or before
5:00 p.m. on the seventh day after execution of this Release. If
so revoked, this Agreement shall be deemed to be void ab initio
and of no further force and effect.
2. Release. As a material inducement to the Company to
enter into the Amendment to which this Release is annexed, and in
consideration of its agreements and obligations under the
Amendment dated as of March 23, 1999 to which this Release is
attached (the "Amendment") and for other good and valuable
consideration, the receipt of which is hereby acknowledged by
Executive, Executive hereby irrevocably, unconditionally and
generally releases, remises and forever discharges, as to all
matters set forth below which are not within the "Release
Exclusions" as defined in Paragraph 3 below, the Company and its
subsidiaries and each of their respective affiliates, officers
and directors, and the heirs, executors, administrators,
receivers, successors and assigns of all of the foregoing
(collectively, "Releasee"), from, and hereby waives and/or
settles, any and all actions, causes of action, suits, debts,
sums of money, agreements, promises, damages, or any liability,
claims or demands, known or unknown and of any nature whatsoever
and which Executive ever had, now has or hereafter can, shall or
may have, for, upon, or by reason of any matter, cause or thing
whatsoever from the beginning of the world to the date of this
release, to the extent not within the Release Exclusions
(collectively, "Claims"), arising directly or indirectly pursuant
to or out of his employment with the Company, the performance of
services for the Company or any Releasee or the termination of
such employment or services and, specifically, without
limitation, any rights and/or Claims (a) arising under or
pursuant to any contract, express or implied, written or oral,
including, without limitation, the Employment Agreement; (b) for
wrongful dismissal or termination of employment; (c) arising
under any federal, state, local or other statutes, orders, laws,
ordinances, regulations or the like that relate to the employment
relationship and/or that specifically prohibit discrimination
based upon age, race, religion, sex, national origin, disability,
sexual orientation or any other unlawful bases, including,
without limitation, the Age Discrimination in Employment Act of
1967, as amended, 29 U.S.C. 621 et. seq. ("ADEA") the Civil
Rights Act of 1991, as amended, the Civil Rights Acts of 1866 and
1871, as amended, the New Jersey labor and employment laws
(including, without limitation, the New Jersey Law Against
Discrimination), and applicable rules and regulations promulgated
pursuant to or concerning any of the foregoing statutes; (d) for
tort, tortious or harassing conduct, infliction of mental
distress, interference with contract, fraud, libel, defamation or
slander; and (e) for damages, including, without limitation,
punitive or compensatory damages or for attorneys' fees,
expenses, costs, wages, injunctive or equitable relief.
3. Release Exclusions. This Release shall not apply to
any rights or Claims that Executive has or may have (I) to
receive the benefits to which he is entitled under the Amendment,
(II) arising under Paragraphs 7 through 9 and 13 through 20 of
the Employment Agreement, (III) to indemnification pursuant to
Nevada Revised Statutes, Title 7, Chapter 78.751 and Article IX
of the Company's By-Laws, (IV) to seek coverage under directors'
and officers' liability insurance policies maintained or required
to be maintained by the Company and (V) to assert affirmative
defenses, other defenses, rights of contribution, and other
rights he may have in respect of claims asserted by any Releasee
or any other person or entity against Executive (the matters
referenced in this Paragraph 3 are referred to in Paragraph 2 as
the "Release Exclusions").
4. Notwithstanding Executive's termination of employment
in consideration of Executive's execution of this Agreement, the
Company shall pay or cause to be paid or provided to Executive,
subject to applicable employment and income tax withholdings and
deductions, all amounts and benefits required to be provided by
the Amendment.
5. Executive agrees and acknowledges that the Company, on
a timely basis, has paid, or agreed to pay, to Executive all
amounts due and owing based on his prior services in accordance
with the terms of the Employment Agreement and that the Company
has no obligation, contractual or otherwise, to Executive, except
as required to be provided by the Amendment, nor does it have any
obligation to hire, rehire or re-employ Executive in the future.
6. Executive agrees and reaffirms that Paragraphs 10(c)
and (d) of the Employment Agreement, as to Confidential
Information, shall continue to apply notwithstanding the
termination of Executive's employment, and that the Company shall
be entitled to all remedies available under Paragraph 11 of the
Employment Agreement in enforcing its rights hereunder as well as
under Paragraphs 10(c) and (d) of the Employment Agreement.
7. Executive further agrees and reaffirms that
Paragraphs 10(a), (b), (e), (f) and (g) of the Employment
Agreement, as to Non-Competition, non-solicitation and other
agreements shall continue to apply notwithstanding the
termination of Executive's employment, and that the Company shall
be entitled to all remedies available under Paragraph 11 of the
Employment Agreement in enforcing its rights hereunder as well as
under Paragraph 10 of the Employment Agreement.
8. Executive further agrees and covenants that, except as
may be required to enforce his rights under the Release
Exclusions, neither he, nor any person, organization or other
entity on his behalf, will file, charge, claim, xxx or cause or
permit to be filed, charged, or claimed, any action, suit or
legal proceeding for personal relief (including without
limitation any action for damages, injunctive, declaratory,
monetary or other relief) against the Company, involving any
matter occurring at any time in the past up to and including the
date of this Agreement, or involving any continuing effects of
any actions or practices which may have arisen or occurred up to
and including the date of this Agreement, including without
limitation any charge of discrimination under ADEA, Title VII of
the Civil Rights Act of 1964, as amended, 42 U.S.C. 2000e et.
seq., the Workers' Compensation Act or state or local laws. In
addition, Executive further agrees and covenants that should he,
or any other person, organization or entity on his behalf, file,
charge, claim, xxx or cause or permit to be filed, charged, or
claimed, any action for damages, including injunctive,
declaratory, monetary or other relief, despite his agreement not
to do so hereunder, or should he otherwise fail to abide by any
of the terms of this Agreement, the Employment Agreement or the
Amendment, then the Company will be relieved of all further
obligations owed hereunder, he will forfeit all monies paid to
him hereunder and he will pay all of the costs and expenses of
the Company (including without limitation reasonable attorneys'
fees) incurred in the defense of any such action or undertaking.
9. Executive hereby agrees and acknowledges that, under
this Agreement and the Amendment, the Company has agreed to
provide him with compensation and benefits that are in addition
to any amounts to which he otherwise would have been entitled
under the Employment Agreement or otherwise in the absence of
this Agreement, and that such additional compensation is
sufficient to support the covenants and agreements by Executive
herein.
10. Executive further agrees and acknowledges that the
undertakings of the Company as provided in this Agreement are
made to provide an amicable conclusion of Executive's employment
by the Company and, further, that Executive will not require the
Company to publicize anything to the contrary. Executive and the
Company, its officers, employees and directors, covenant and
agree that they will not disparage the name, business reputation
or business practices of the other.
11. Executive hereby certifies that he has read the terms
of this Agreement, that he has been advised by the Company to
consult with an attorney and that the understands its terms and
effects. Executive acknowledges, further, that he is executing
this Agreement of his own volition, without any threat, duress or
coercion and with a full understanding of its terms and effects
and with the intention, as expressed in Section 2 hereof, of
releasing all claims recited herein in exchange for the
consideration described herein, which he acknowledges is adequate
and satisfactory to him. The Company has made no representations
to Executive concerning the terms or effects of this Agreement
other than those contained in this Agreement.
12. Executive and the Company agree that if any part of
this Agreement is determined to be invalid, illegal or otherwise
unenforceable, the remaining provisions of this Agreement shall
not be affected and will remain in full force and effect.
13. This Agreement shall be interpreted and enforced under
the laws of the State of New Jersey.
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement on the day and year first above written.
ATTEST: PLAYERS INTERNATIONAL, INC.
BY:
Secretary
Witness Xxxxxxx Xxxxxxx, Xx.
Exhibit B
To pursue any and all rights or Claims, the following
is a list of companies with respect to which a change in control
transaction has received active consideration by the Board as of
April 6, 1999:
Apollo/Xxxxxxx Xxxxxx
Xxxxx
Xxxx Gaming Corp.
Colony Capital/Xxxxxx'x
Xxxxxx'x Entertainment
Hollywood Park
Horseshoe Gaming, Inc./Xxxxxx
Insignia Financial/Xxxxxx Xxxxxx
Jackpot Enterprises, Inc.
Xxxxxx Entertainment/Black Hawk Gaming
Ladbroke Group/Colorado Gaming
Xxxxxx X. Xxx Company
MacAndrew & Forbes/Xxxxxx Xxxxxxxx
North Star Capital Partners/Xx Xxxxxx & Xxxxx Xxxxxxxx
Penn-National Gaming
Sun International
Note: For the purposes of this Amendment, a transaction with an
affiliate of any of the above listed companies or entities will
be treated in the same manner as a transaction with the Company
itself.
Exhibit C
To pursue any and all rights or Claims, he following is
a list of companies with respect to which a change in control
transaction has received active consideration by the Board as of
March 23, 1999:
Apollo/Xxxxxxx Xxxxxx
Xxxxx
Xxxx Gaming Corp.
Colony Capital/Xxxxxx'x
Xxxxxx'x Entertainment
Hollywood Park
Horseshoe Gaming, Inc./Xxxxxx
Insignia Financial/Xxxxxx Xxxxxx
Jackpot Enterprises, Inc.
Xxxxxx Entertainment/Black Hawk Gaming
Ladbroke Group/Colorado Gaming
Xxxxxx X. Xxx Company
MacAndrew & Forbes/Xxxxxx Xxxxxxxx
North Star Capital Partners/Xx Xxxxxx & Xxxxx Xxxxxxxx
Penn-National
Sun International
Note: For the purposes of this Letter, a transaction with an
affiliate of any of the above listed companies or entities will
be treated in the same manner as a transaction with the Company
itself.
