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EXHIBIT 10.73
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made effective November 10, 1997, by and between Grand
Casinos, Inc., a Minnesota corporation ("Employer"), and Xxxx Xxxxxx
("Employee").
WHEREAS, Employee is Chairman of the Board of Directors and Chief Executive
Officer of Employer and has extensive experience in and is primarily responsible
for Employer's business; and
WHEREAS, Employer desires to employ Employee as Chief Executive Officer of
Employer pursuant to the terms and conditions of this Agreement; and
WHEREAS, Employee desires to accept such employment pursuant to such terms and
conditions;
NOW, THEREFORE, in consideration of the foregoing and the promises and
agreements stated below, Employer and Employee hereby agree as follows:
1. Employment. Employer shall employ Employee, and Employee hereby accepts such
employment, on the terms and conditions stated in this Agreement.
2. Term. This Agreement shall be for an initial term beginning on November 10,
1997, and ending on the earlier of (i) November 9, 2001, or (ii) the date on
which this Agreement is terminated pursuant to Section 11 below.
3. Base Salary. Employer shall, during the term of this Agreement, pay Employee
an annual base salary in the amount of $600,000, or such higher amount as may
from time-to-time be determined by Employer in its sole discretion. Such salary
shall be paid in equal installments in the manner and at the times as other
employees of Employer are paid.
4. Incentive Compensation. Employee shall, during the term of this Agreement,
participate in Employer's incentive compensation program from time-to-time
established and approved by the Employer's Board of
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Directors, such participation to be on the same terms and conditions as from
time-to-time apply to senior and executive vice presidents of Employer.
5. Benefits. Employer shall, during the term of this Agreement, provide to
Employee such benefits as are provided by Employer to other senior and executive
vice presidents of Employer. Employee shall pay for the portion of the cost of
such benefits as is from time-to-time established by Employer as the portion of
such cost to be paid by senior and executive vice presidents of Employer.
6. Costs and Expenses. Employer and Employee acknowledge that Employee will
incur travel and other expenses while traveling on business for Employer and
performing Employee's duties under this Agreement, and that it will be
inefficient for both Employer and Employee to provide for Employer to reimburse
Employee for such expenses as are not paid directly by Employer.
Accordingly, Employer shall pay to Employee during each calendar month (or
portion thereof) during the term of this Agreement, a monthly travel and expense
fee in the amount of $600, which travel and expense fee shall be full and
complete payment to Employee for all such expenses. Employer and Employee
acknowledge that the actual amount of such expenses incurred by Employee during
any given calendar month may be more or less than the amount of such travel and
expense fee.
In addition, Employee shall have the right to use Employer's aircraft for
Employee's personal purposes at such times as such aircraft is not needed by
Employer for any other purpose; provided, however, that Employee shall pay or
reimburse Employer for (i) all pilot meal, transportation and lodging costs
(whether or not such pilots are employees of Employer), and (ii) all costs of
providing pilots other than pilots which are employees of Employer, which costs
are incurred by Employer during Employee's use of such aircraft for personal
purposes.
7. Duties. The duties to be performed by Employee during the term of this
Agreement shall be designated from time-to-time by the Board of Directors of
Employer and will include the primary responsibility for Employer's business.
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8. Confidentiality. Except to the extent required by law, Employee shall keep
confidential and shall not, without Employer's prior written consent, disclose
to any third-party, other than as reasonably necessary or appropriate in
connection with Employee's performance of his duties under this Agreement, any
information regarding Employer and its affiliates, subsidiaries, business,
methods of operation, employees, projects, plans and prospects, which
information has not been released to the public by Employer. The provisions of
this Section 8 shall remain in effect after the expiration or any termination of
this Agreement.
9. Termination. This Agreement shall terminate as follows:
(a) at the end of the term hereof;
(b) upon the death of Employee;
(c) upon the determination by the Board of Directors of Employer
to terminate this Agreement after Employee becomes disabled to
the extent that the Employee cannot perform the essential
duties and responsibilities described in this Agreement and
such disability continues for more than 60 days;
(d) upon at least 30 days' prior written notice of termination
given for any or no reason by Employee to Employer; or
(e) upon at least 30 days' prior written notice of termination
(for cause or not for cause) given by Employer's Board of
Directors to Employee.
10. Benefits After Termination. Upon termination of this Agreement under Section
9 above, Employee's rights to pay, compensation and benefits under this
Agreement shall, except to the extent earned, accrued or vested prior to the
date of termination, cease on the date on which Employee's employment under this
Agreement terminates, except as follows:
(a) if such termination is under Section 9(c) above, Employee
shall be entitled, during the period of such disability, to
such disability, medical and life insurance and other benefits
as are provided by Employer at the time of Employee's
disability to senior and executive vice presidents of
Employer; or
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(b) if such termination is under Section 9(e) above and is not for
cause (as defined in the following paragraph) and Section 11
below does not apply, Employer shall:
(i) pay to Employee, in a lump sum within 10 days after
the effective date of such termination, the amount of
Employee's then current base salary pursuant to
Section 3 above for a period of 365 days;
(ii) provide to Employee benefits to which Employee would
have been entitled if this Agreement had remained in
effect for 365 days after the effective date of such
termination; and
(iii) pay to Employee the portions of the incentive
compensation for the year of such termination which
are (a) determined by objective measurement standards
under Employer's incentive compensation program
applicable to senior and executive vice presidents of
Employer, and (b) would have been paid to Employee
had Employer been continuously employed under this
Agreement through the end of both such years. Payment
of such portions of incentive compensation, if any,
shall be made to Employee within 10 business days
after the date, if any, on which senior and executive
vice presidents of Employer receive payment of their
incentive compensation under such incentive
compensation program.
For the purposes of this Section 10(b), "cause" shall mean the
(i) commission of a felony, (ii) the theft or embezzlement of
property of Employer or the commission of any similar act
involving moral turpitude, (iii) the failure of Employee to
substantially perform his material duties and responsibilities
under this Agreement for any reason other than Employee's
disability, which failure is not cured within 30 days (or if
such cure is commenced within such 30-day period and
thereafter diligently pursued, such longer period not to
exceed 90 days as is reasonably required to cure such
failure), after written notice
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of such failure from Employer's Board of Directors specifying
the failure, or (iv) the revocation of any gaming license
issued by any governmental entity to Employee as a result of
any act or omission by Employee. Any lump sum payment made by
Employer to Employee pursuant to this Section 10(b) shall be
subject to withholding as required by applicable law, but such
withholding shall, to the extent permitted by applicable law,
be calculated in the same manner as for a lump-sum bonus or
incentive compensation payment.
11. Change of Control. For the purposes of this Section 11, the term "Change of
Control" shall mean:
(a) any person (as defined in Sections 3(a)(9) and 13(d)(3) of the
Securities Exchange Act of 1934) directly or indirectly
becoming the "beneficial owner" (as defined in Rule 13d-3
promulgated pursuant to such Securities Exchange Act) of 25%
or more of the combined voting power of Employer's then
outstanding securities; or
(b) the occurrence within any 12-month period of a change in the
membership of Employer's Board of Directors such that the
Incumbent Members (as defined in the following sentence) do
not constitute a majority of the members of such Board of
Directors. "Incumbent Members" shall mean, with respect to any
given 12-month period, the members of such Board of Directors
on the date immediately preceding the commencement of such
given 12-month period; provided, however, that any person who
becomes a member of such Board of Directors during such given
12-month period whose election or appointment to such Board of
Directors was approved by a vote of a majority of the members
of such Board of Directors who, on the date of such election
or nomination, comprised the Incumbent Members on the date of
such vote shall be considered one of the Incumbent Members
with respect to such 12-month period.
If after a Change of Control Employee gives written notice to
Employer that Employee resigns from his employment by
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Employer, Employer shall (in lieu of and in not in addition to
the payments and benefits described in Section 10(b) above):
(i) pay to Employee, in a lump sum within 10 days after
the effective date of such termination, the amount of
Employee's then current base salary pursuant to
Section 3 above for a period of the greater of (i)
730 days, or (ii) the remaining number of days in the
term of this Agreement;
(ii) provide to Employee benefits to which Employee would
have been entitled if this Agreement had remained in
effect for 365 days after the effective date of such
termination; and
(iii) pay to Employee the portions of the incentive
compensation for the year of such termination which
are (a) determined by objective measurement standards
under Employer's incentive compensation program
applicable to senior and executive vice presidents of
Employer, and (b) would have been paid to Employee
had Employer been continuously employed under this
Agreement through the end of both such years. Payment
of such portions of incentive compensation, if any,
shall be made to Employee within 10 business days
after the date, if any, on which senior and executive
vice presidents of Employer receive payment of their
incentive compensation under such incentive
compensation program.
The provisions of this paragraph shall apply following any Change of Control
notwithstanding any provision otherwise in any stock option agreement between
Employer and Employee which provides for the grant to Employee of the right to
purchase shares of stock of Employer. If, after any Change of Control, employee
ceases to be employed by Employer, for any reason or no reason, with or without
cause, Employee or his legal representative shall have until the later of (i)
the date which is six months after the date on which the Employee ceases to be
employed by Employer, or (ii) November 9, 2001 to exercise Employee's right to
purchase shares of
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stock of Employer under such option agreements (whether entered into before or
after the date of this Agreement).
12. Amendment. This Agreement may be amended only in writing signed by both
Employer and Employee.
13. Entire Agreement. Except for the provisions the stock option or purchase
agreements (each, a "Stock Agreement") between Employer and Employee, copies of
which are attached hereto as Exhibit A, this Agreement contains the entire
understanding of Employer and Employee with respect to all matters described
herein, and there are no other agreements, conditions or representations, oral
or written, express or implied with respect thereto. Except for the Stock
Agreements, this Agreement supersedes all prior agreements relating to
Employer's employment of Employee.
14. Successors and Assigns. Employee shall not assign this Agreement without the
prior written consent of Employer's Board of Directors. This Agreement shall be
binding upon, and shall inure to the benefit of Employee and his heirs and
personal representatives, and to Employer and its successors and assigns.
15. Notices. All notices or other communications to be given under this
Agreement shall be personally delivered or sent by courier service to the
following addresses:
if to Employer
Grand Casinos, Inc.
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxx 00000
Attn: President
with a copy to
Grand Casinos, Inc.
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxx 00000
Attn: General Counsel
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if to Employee
Xxxx Xxxxxx
000 Xxxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxx 00000
or to such other addresses either party may provide to the other by written
notice given in the manner provided in this Section 15.
16. Waiver. Any waiver by any party to this Agreement with respect to any
provision or incident shall not operate or be construed as a waiver of any other
provision of this Agreement or any other incident.
17. Governing Law. This Agreement will be interpreted and enforced in accordance
with the laws of the State of Minnesota, without giving effect to conflict of
law issues.
18. Agreement Not To Compete. Employee hereby agrees to not, without the prior
written consent of Employer's Board of Directors, directly or indirectly engage
in any of the following actions on or before the date that is two years after
the date on which Employee's employment under this Agreement is terminated for
any reason:
(a) own any interest in, manage, operate, join, control, lend
money or render other financial assistance to, participate or
be connected with, as an officer, employee, partner,
stockholder, consultant or otherwise, any entity whose
products or services are offered in the State of Louisiana or
the State of Mississippi and could be considered part of the
gaming industry; provided, however, that nothing in this
Section 18(a) shall preclude Employee from holding less than
twenty percent of the outstanding capital stock of any
corporation whose products or services are offered in either
or both of such states and could be considered part of such
industry and which is required to file periodic reports with
the U.S Securities and Exchange Commission under Section 13 or
15(d) of the Securities Exchange Act of 1934 (as amended), the
securities of which corporation are listed on any securities
exchange, quoted on the
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National Association of Securities Dealers Automated Quotation
System or traded in the over-the-counter market; or
(b) solicit for employment, endeavor to entice away from Employer
or otherwise interfere with Employer's relationship with any
person who is employed by or otherwise engaged to perform
services for Employer, whether for Employee's own account or
for the account of any other individual, partnership, firm,
corporation or other business entity.
If the scope of Employee's agreement under this Section 18 is determined by any
court of competent jurisdiction to be too broad to permit the enforcement of all
of the provisions of this Section to their fullest extent, then the provisions
of this Section 18 shall be construed (and each of the parties hereto hereby
confirm that its intent is that such provisions be so construed) to be
enforceable to the fullest extent permitted by applicable law. To the maximum
extent permitted by applicable law, Employee hereby consents to the judicial
modification of the provisions of this Section 18 in any proceeding brought to
enforce such provisions in such a manner that renders such provisions
enforceable to the maximum extent permitted by applicable law.
IN WITNESS WHEREOF, Employer and Employee have executed this Agreement effective
as of the date first stated above.
EMPLOYER:
Grand Casinos, Inc.
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
President
EMPLOYEE:
Xxxx Xxxxxx
/s/ Xxxx Xxxxxx
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