SEPARATION OF EMPLOYMENT AGREEMENT AND GENERAL RELEASE
EXHIBIT
10.1
Separation
Agreement – Xxxxxxxx Xxxxxxxx
SEPARATION
OF EMPLOYMENT AGREEMENT AND GENERAL RELEASE
THIS
SEPARATION OF EMPLOYMENT AGREEMENT AND GENERAL RELEASE (the "Agreement")
is
effective as of the 28th day of September 2007 (the "Effective Date"), by
and between and Black Gaming LLC, a Nevada limited liability company (as
successor or assignee of Virgin River Casino Corporation, a Nevada Corporation,
RBG, LLC, a Nevada limited liability company, and Casablanca Resorts, LLC,
a
Nevada limited liability company) (the "Company"), and Xxxxxxxx Xxxxxxxx
("Employee").
RECITALS
A. Employee
was employed by Company as Company's Chief Operating Officer pursuant to
an
Employment Agreement, dated April 1, 2005 ("Employment Agreement"), which
provides for certain payments and benefits in the event that Employee's
employment is terminated under certain circumstances;
B. Employee
and Company have agreed to terminate the Employment Agreement effective as
of
the Effective Date subject to the terms and conditions provided herein;
and
NOW,
THEREFORE, in consideration of the mutual covenants and promises contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree that the
foregoing recitals are true and correct, and further agree as
follows:
AGREEMENT
1. Severance
Payment; Release.
1.1. Severance
Payment. In consideration of the termination of the Employment
Agreement, on the Effective Date Company shall pay to Employee, as severance
pay, the lump sum amount of Three Hundred and Two Thousand Dollars and 00/100
($302,000.00) by wire transfer of immediately available funds to such account
or
accounts as Employee designates in writing by the close of business on the
Effective Date hereof ("Severance Payment"). Such Severance
Payment shall be subject to ordinary withholding and represents the sole
and
exclusive sum that Company will ever pay Employee in consideration of the
cessation of employment with the Company.
1.2. Release
by Employee. For and in consideration of the Severance Payment
and the termination of the Employment Agreement, Employee does hereby REMISE,
RELEASE AND FOREVER DISCHARGE the Company, its affiliates, predecessors,
subsidiaries and parents, and their present or former officers, directors,
shareholders, employees, and agents, and its and their respective successors,
assigns, heirs, executors, and administrators and the current and former
trustees or administrators of any pension or other benefit plan applicable
to
the employees or former employees of the Company (collectively, "Releasees")
from all causes of action, suits, debts, claims and demands whatsoever in
law or
in equity, which the Employee ever had, now has, or hereafter may have, whether
known or unknown, or which the Employee's heirs, executors, or administrators
may have, by reason of any matter, cause or thing whatsoever, from any time
prior to the date of this Agreement, and particularly, but without limitation
of
the foregoing general terms, any claims arising from or relating in any way
to
the Employee's employment relationship with the Company, the terms and
conditions of that employment relationship, and the termination of that
employment relationship, including, but not limited to, any claims arising
under
Title VII of the Civil Rights Act of 1964, the Americans with Disabilities
Act,
the Family and Medical Leave Act of 1993, the Equal Pay Act, the Employee
Retirement Income Security Act of 1974, Nevada wages and hour law, Nevada
law
pertaining to employment practices of any kind; any other federal, state
or
local law regulating employment, and any and all claims under the common
law for
breach of express or implied contract, violation of the covenant of good
faith
and fair dealing, violation of public policy, negligence, slander, defamation,
invasion of privacy, false light, false imprisonment, trespass, breach of
fiduciary duty, intentional interference with business relations, interference
with prospective economic advantage, intentional or negligent infliction
of
emotional distress, intrusion, retaliatory or wrongful termination, punitive
damages, and wage claims. This Agreement is effective without regard
to the legal nature of the claims raised and without regard to whether any
such
claims are based upon tort, equity, implied or express contract or
discrimination of any sort.
1.3 Release
by Company. For and in consideration of the termination of the
Employment Agreement, Company does hereby REMISE, RELEASE AND FOREVER DISCHARGE
Employee, and, if Employee is a business entity, then its affiliates,
predecessors, subsidiaries and parents, and their present or former officers,
directors, shareholders, employees, and agents, and its and their respective
successors, assigns, heirs, executors, and administrators (collectively,
"Employee Released Parties") from all causes of action, suits, debts,
claims and demands whatsoever in law or in equity, which Company ever had,
now
has, or hereafter may have, whether known or unknown, by reason of any matter,
cause or thing whatsoever, from any time prior to the Effective Date, and
particularly, but without limitation of the foregoing general terms, any
claims
arising from or relating in any way to Employee's former employment relationship
with Company, the terms and conditions of that employment relationship, and
the
termination of that employment relationship; provided, however, that Company
does not release the Employee Released Parties from any causes of action,
suits, debts, claims and demands arising out of any malfeasances, gross
negligence, criminal misconduct, fraud or gross dereliction in duty causing
substantial financial harm to Company committed by Employee during the term
of
the Employment Agreement and occurring prior to the Effective Date.
2. Base
Salary. In addition to the Severance Payment, Employee is
entitled to receive and shall receive all outstanding Base Salary, as that
term
is defined in the Employment Agreement, accrued through the Effective Date
of
this Agreement, which payment shall be delivered to Employee on the Effective
Date.
3. Public
Statements. Employee and Company mutually agree that neither
party will disparage or subvert the other party, or make any statement
reflecting negatively on the other party, its affiliates, or any of their
officers, directors, employees, agents or representatives, including, but
not
limited to, any matters relating to the operation or management of the
Properties, Employee's prior employment relationship with Company, and the
termination of Employee's employment, regardless of the truthfulness or falsity
of such statement. Employee and Company agree that any language contained
in any
public statements, press releases, SEC filings and similar statements and/or
documents relating to Employee's termination of his employment relationship
with
Company, or any matters related thereto, shall be mutually agreed upon in
writing in advance by Employee and Company. More specifically, the
anticipated 8-K filing shall state:
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SECTION
5 – CORPORATE GOVERNANCE AND MANAGEMENT
Item
5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
(b) On
September 26, 2007, Xxxxxxxx Xxxxxxxx gave us notice of his intent to resign
as
our Chief Operating Officer effective September 28, 2007. As a result
of his resignation, the Executive Employment Agreement dated April 1, 2005
made
by our direct or indirect wholly owned subsidiaries Virgin River Casino
Corporation, RBG, LLC and Casablanca Resorts, LLC with Xx. Xxxxxxxx will
terminate on the effective date of Xx. Xxxxxxxx’x resignation. The
Executive Employment Agreement was filed as an exhibit to our Form 10-K/A,
as
filed with the Securities and Exchange Commission on April 25, 2006, and
is
incorporated herein by reference.
On
September 28, 2007, we entered into a separation agreement with Xx. Xxxxxxxx
(the “Lowenhar Agreement”) pursuant to which we will pay Xx. Xxxxxxxx a lump sum
payment of $302,000 which includes a $277,000 severance payment and a $25,000
payment for a two-year non-compete covenant. The Lowenhar Agreement
also provides for a mutual release of claims between us and Xx. Xxxxxxxx
and
contains customary confidentiality and non-solicitation covenants by Xx.
Xxxxxxxx.
On
September 26, 2007, Xxxxx XxXxxxxx gave us notice of his intent to resign
as our
Vice President of Marketing effective September 28, 2007. As a result
of his resignation, the Employment Agreement dated January 1, 2006 made by
our
direct or indirect wholly owned subsidiaries Virgin River Casino Corporation,
RBG, LLC and Casablanca Resorts, LLC with Xx. XxXxxxxx will terminate on
the
effective date of Xx. XxXxxxxx’x resignation.
On
September 28, 2007, we entered into a separation agreement with Xx. XxXxxxxx
(the “XxXxxxxx Agreement”) pursuant to which we will pay Xx. XxXxxxxx a lump sum
payment of $50,000 which includes a $37,500 severance payment and a $12,500
payment for a two-year non-compete covenant. The XxXxxxxx
Agreement also provides for a mutual release of claims between us and Xx.
XxXxxxxx and contains customary confidentiality and non-solicitation covenants
by Xx. XxXxxxxx.
On
October
1, 2007, we issued a press release announcing Xx. Xxxxxxxx’x and Xx. XxXxxxxx’x
resignations, a copy of which is attached hereto as Exhibit 99.1 and is
incorporated herein by reference.
The
foregoing summaries of the Lowenhar Agreement and the XxXxxxxx Agreement
are
qualified in their entirety by reference to the complete texts of the Lowenhar
Agreement and the XxXxxxxx Agreement, copies of which are attached hereto
as
Exhibits 10.1 and 10.2, respectively, and are incorporated herein by
reference.
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Employee
and Company shall issue a press release which shall include substantially
similar content as the 8-K filing, and shall include:
Today
Black Gaming, LLC announced a re-organization of its management team including
the resignations of Xxxxxxxx Xxxxxxxx, the company's Chief Operating Officer,
and Xxxxx XxXxxxxx, the company's Vice President of Marketing and
Sales. CEO and Chairman Xxxxx Xxxxx, Sr., offered, “In the face of a
challenging market, we have devised a new plan to reduce our corporate cost
structure as we ride out this difficult time here in the Mesquite market.
Under the new structure I will personally return to the company’s day to day
operations."
"Xxxxxxxx
helped lead our company to record EBITDA levels in 2005 and 2006. In
addition our company now boasts better customer service and a more aligned
workforce with more capable management capacity than ever in its
history."
Xxxxx
Xxxxx continued, “We also appreciate the contributions of Xxxxx XxXxxxxx to the
company. Through his development of a well branded loyalty program, direct
marketing system and advertising campaign we succeeded in helping to grow
our
revenues and our customer loyalty. Due in part to Xxxxx’x efforts, more
customers than ever before know about Black Gaming, about Mesquite and the
products we have to offer.”
4. Reemployment. Employee
agrees to relinquish and hereby does relinquish any and all rights to
reemployment with Company. Employee further agrees that he will not
in the future seek, otherwise pursue or accept employment with Company or
its
affiliates.
5. Non-Competition.
5.1. Separate
Consideration. Employee hereby represents, warrants and agrees
with Company that Twenty-Five Thousand Dollars and 00/100
($25,000.00) of the Severance Payment constitutes good and
valuable consideration, the receipt and sufficiency of which are hereby
expressly acknowledged, for the covenants and agreements contained in
Section 5.2 hereof.
5.2. Non-Compete. Employee
acknowledges that, in the course of performing his duties as an employee,
Employee has formed relationships and become acquainted with certain
confidential and proprietary information as further described in Section
6
hereof. Employee further acknowledges that such relationships and
information are and will remain valuable to Company and that any restrictions
on
Employee’s future employment, if any, are reasonably necessary for Company to
remain competitive in the business industry in which it operates. In
recognition of Company’s heightened need for protection from abuse of
relationships formed or information garnered during his employment by Company,
Employee covenants and agrees that during the two (2) years immediately
following the Effective Date of this Agreement, Employee will not directly
or
indirectly be employed by, provide consultation or other services to, engage
or
participate in, provide advice, information or assistance to, fund, or otherwise
be connected or associated in any way or manner with, any firm, person,
corporation, or other entity that is either directly, indirectly or through
an
affiliated company or entity, engaged in Company’s business within 70 miles of
Casablanca Resort, Mesquite, Nevada, without the express written permission
of
Company, which permission shall be at Company's sole and exclusive
discretion.
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6. Confidentiality
6.1. Confidential
Information. Employee covenants and agrees that he shall not at
any time, without Company’s prior written consent, disclose or make known to any
person or entity any confidential or proprietary information about Company,
including, but not limited to, any information regarding assets, trade secrets,
customers, future plans and methods of doing business (collectively, the
"Confidential Information") that is not already and generally known to
the public through no wrongful act of Employee or any other party.
6.2. Return
of Confidential Information. Employee covenants and agrees that
on or before the Effective Date, he shall return to Company any and all
Confidential Information and all other documents, photographs or other materials
of any kind, and all copies or reproductions thereof, in whatever media,
made
available or supplied by Company to Employee.
7. Representations. Employee
hereby represents, warrants and agrees with Company that:
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a.
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The
covenants and agreements contained in Section 5 and 6 above are
reasonable, appropriate and suitable in their geographic scope,
duration
and content. As such, Employee covenants and agrees that he
shall not, directly or indirectly, raise any issue of the reasonableness,
appropriateness and suitability of the geographic scope, duration
or
content of such covenants and agreements in any proceeding to enforce
such
covenants and agreements.
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b.
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The
enforcement of any remedy under this Agreement will not prevent
Employee
from earning a livelihood, because Employee's past work history
and
abilities are such that Employee can reasonably expect to find
work
irrespective of the covenants and agreements contained in Section
5
above;
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c.
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The
covenants and agreements stated in Sections 5 and 6 and this Section
7,
are essential for the Company's reasonable
protection;
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d.
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Company
has reasonably relied on these covenants and agreements by Employee;
and,
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e.
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Employee
agrees that in the event of Employee's breach or threatened breach
of any
covenants and agreements set forth in Sections 5 and 6 above, the
Company
may seek to enforce such covenants and agreements through any equitable
remedy, including specific performance or injunction, without waiving
any
claim for damages. In any such event, Employee waives any claim
that Company has an adequate remedy at law or for the posting of
a
bond.
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8. General
Provisions.
8.1. Entire
Agreement. This Agreement sets forth the entire agreement and
understanding between the parties hereto relating to the matters contemplated
hereby and, as of the Effective Date, supersedes and replaces in their entirety
any and all prior agreements (whether written or oral), arrangements or
understandings between the parties hereto with respect to the subject matter
hereof and any such other agreements or understandings are hereby deemed
terminated and of no further force and effect.
8.2. Severability. If
any provision or provisions of this Agreement shall be held to be invalid,
illegal or unenforceable for any reason whatsoever, (i) the validity,
legality and enforceability of the remaining provisions of this Agreement
(including, without limitation, all portions of any sections of this Agreement
containing any such provision held to be invalid, illegal or unenforceable,
that
are not themselves invalid, illegal or unenforceable) shall not in any way
be
affected or impaired thereby, and (ii) to the fullest extent possible, the
provisions of this Agreement (including, without limitation, all portions
of any
section of this Agreement containing any such provision held to be invalid,
illegal or unenforceable that are not themselves invalid, illegal or
unenforceable) shall be construed so as to give effect to the intent manifested
by the provisions held invalid, illegal or unenforceable.
8.3. Modification
and Waiver. No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by both of the parties
hereto. No waiver of or failure to require strict compliance with any
of the provisions of this Agreement shall be deemed or shall constitute a
waiver
of any rights or remedies, or a waiver of any subsequent failure in the
performance of or compliance with any terms of this Agreement.
8.4. Notices. All
notices required or permitted to be given hereunder shall be in writing and
shall be deemed given (i) when delivered in person, on the first business
day
following delivery by a nationally recognized private overnight courier,
or (ii)
three business days after being deposited in the United States mail, postage
prepaid, registered or certified mail, or (iii) upon sender’s confirmation of
successful transmission when delivered via facsimile, so long as the facsimile
is followed by deposit of such notice in the United States mail, in each
instance addressed as follows:
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If
to Company:
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Black
Gaming, LLC
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Attn.
Xx. Xxxxxx X. Xxxxx, Xx.
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000
Xxxxx Xxxxxxx, Xxxxx 000
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Xxx
Xxxxx, Xxxxxx 00000
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With
a copy to:
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Xxxxxx
& Xxxxxxxx
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Attn.
Xxxx X. Xxxxxxxxx
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0000
Xxxxxx Xxxxxx Xxxxxxx, Xxxxx 000
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Xxx
Xxxxx, Xxxxxx 00000
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If
to Employee:
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Xx.
Xxxxxxxx Xxxxxxxx
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000
Xxxxxxx Xxxxx
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Xxx
Xxxxxxxxx, XX 00000
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With
a copy to:
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Xxxxxxxxxx
Xxxxx Xxxxxx Xxxxxxx, P.C.
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Attn.
Xxxxxx Xxxxxxx, Esq.
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000
Xxxxx Xxxxxx Xxxxxx, Xxxxx 0000
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Xxx
Xxxxx, Xxxxxx 00000
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8.5. Successors
and Assigns. This Agreement shall inure to the benefit of and be
binding upon (i) Company, its successors and assigns; and (ii) Employee,
his
permitted successors and assigns.
8.6. Governing
Law; Jurisdiction; Litigation. This Agreement has been prepared,
executed and delivered in, and shall be interpreted under, the internal laws
of
the State of Nevada, without giving effect to its conflict of law
provisions. Each of the parties hereto irrevocably and
unconditionally waives any objection to the laying of venue of any action,
suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby in (a) the courts of the State of Nevada, Xxxxx County, or (b) the
United States District Court for the State of Nevada, and hereby further
irrevocably and unconditionally waives and agrees not to plead or claim in
any
such court that any such action, suit or proceeding brought in any such court
has been brought in an inconvenient forum. The parties hereto waive
trial by jury in any action or proceeding brought in connection with this
Agreement.
8.7 Further
Assurances. The parties agree to execute and deliver any and all
further agreements, instruments or documents, and to take any and all such
further action, as may be reasonably requested or required to carry into
effect
the purpose and intent of this Agreement.
8.8. Attorneys’
Fees. In any judicial, arbitration or other proceeding between
the parties seeking enforcement of or attempting to construe any of the terms
and provisions of this Agreement, the prevailing party in such action shall
be
awarded, in addition to damages, injunctive or other relief to which it may
be
entitled, its reasonable costs and expenses and reasonable attorneys’
fees.
8.9. Neutral
Interpretation. The provisions contained herein shall not be
construed in favor of or against any party because that party or its counsel
drafted this Agreement, but shall be construed as if both parties prepared
this
Agreement, and any rules of construction to the contrary are hereby specifically
waived.
8.10. Voluntary
Nature of Agreement/Opportunity to Consult with Counsel. Each of
the parties represents that it or she has read carefully and understands
this
Agreement, that it or he is fully aware of the Agreement’s legal effect and that
each party had an opportunity to consult with its or his own counsel with
regard
to this Agreement. The terms of this Agreement were negotiated at
arm’s length by the parties hereto. The parties hereto acknowledge
and agree that they are signing this Agreement freely, voluntarily and with
full
knowledge of its terms and consequences.
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8.11. Headings. Headings
and captions used herein are inserted as a matter of convenience and for
reference only and in no way define, limit, extend or describe the scope
of this
Agreement or any provisions contained herein.
8.12.
Counterparts. This Agreement may be executed in one or more
counterparts, including, without limitation, facsimile counterparts, each
of
which will be deemed an original but both of which together will constitute
one
and the same instrument.
IN
WITNESS
WHEREOF, the parties have duly executed this Agreement as of the Effective
Date.
| COMPANY: | ||
| Black Gaming, LLC, | ||
| a Nevada limited liability company | ||
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By:
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/s/
Xxxxxx X. Xxxxx, Xx.
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Name:
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Xxxxxx
X. Xxxxx, Xx.
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Its:
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President
and Chief Executive Officer
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| EMPLOYEE: | ||
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By:
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/s/
Xxxxxxxx Xxxxxxxx
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Xx.
Xxxxxxxx Xxxxxxxx
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