EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made effective for all purposes and in all respects
as of the 18th day of February, 2003, by and between CENTURY CASINOS, INC., a
Delaware corporation (hereinafter referred to as the "Employer" or the
"Company"), and XXXXX XXXXXXXXXX (hereinafter referred to as the "Employee").
WITNESSETH THAT:
WHEREAS, Employee is presently employed, and has since 1993 been employed
by the Company; and
WHEREAS, the Employee's performance of his duties of the Company has been
and continues to be critical to the success of the Company; and
WHEREAS, both the Company and the Employee desire to set forth the terms
and conditions of their agreements and understandings (as agreed
verbally and as consummated and acted on immediately before entering
into this Agreement), and for their mutual benefit to extend the term
of Employee's employment hereunder;
NOW, THEREFORE, in consideration of the foregoing, of the mutual promises
herein contained, and of other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties,
intending legally to be bound, agree as follows:
1. Term of Agreement.
The term of this Agreement shall commence on the 18th day of February,
2003, and shall continue until December 31, 2008, and shall be automatically
renewed for additional, successive periods of five (5) years each thereafter,
unless sooner terminated in accordance with the provisions of Paragraph 5.
2. Duties of Employee.
A strong focus of the Company's operations and future developments lies,
and will continue to lie, overseas (outside the US). The continuous management
and supervision of the existing international operations, as well as the
acquisition of new international projects and developments, require a
substantial amount of international traveling. In accepting this Employment
Agreement, Employee shall undertake and assume the responsibility of looking
after the Company's international businesses and shall devote his best efforts
to such duties.
3. Compensation.
3.1 Salary. As compensation for the services rendered by Employee for the
Company pursuant to this Agreement, Employee shall be paid not less than the
following base annual salary, on a monthly basis, during the term hereof:
$24,000, plus annual increases and bonuses, and such other incentives, benefits,
insurance policies and compensation as may have been and may be awarded to him
from time to time by the Compensation Committee of the Board of Directors of the
Company.
3.2 Employees' Equity Incentive Plan. Employee shall be a participant in
the Company's Employees' Equity Incentive Plan, as it may be amended from time
to time by the Board of Directors; provided, that if any change - after the date
of this Agreement - in any tax rules and regulations, or in the application or
applicability of any tax rules as a result of Employee's employment with the
Company, or required accounting principles shall negatively impact the amount of
Employee's total after tax compensation under this Section 3, the Company shall
increase Employee's other compensation and incentives accordingly to completely
offset such negative impact.
3.3 Salary Review. Employee's salary will be reviewed annually by the
Compensation Committee.
4. Additional Benefits.
In addition to, and not in limitation of, the compensation referred to in
Section 3, Employee shall be paid the following
1
additional benefits during the term hereof:
4.1 Reimbursement. The Company shall continue to either provide Employee
with, or shall reimburse Employee for, all Reasonable Expenses incurred by him
in connection with the performance of his duties as an executive for the
Company, in substantially at least the same form and fashion as it has been done
during the past twelve (12) months preceding the date of this Agreement.
4.2 Death or Disability Payments.
(a) In the event of the Employee's disability or death, during the
term of his employment hereunder, Employee's salary in effect at the time of his
death or disability shall continue to be paid to the Employee, or to his
designee or heirs, for a period of twelve (12) calendar months from the date of
death or from the date of Employee's termination of employment by reason of
disability.
(b) For the purposes of this Employment Agreement, the obligations of the
Company to make the payments upon the disability of Employee shall not become
effective unless and until all of the following conditions are met, as
determined (referring to (i) and (ii) below) by the Employee's regular physician
and an independent physician selected by the Employee (or his immediate family):
(i) Employee shall become physically or mentally incapable (excluding
infrequent and temporary absences due to ordinary illnesses) of properly
performing the services required of him in accordance with his obligations
under Section 2 hereof or similar provisions of any renewal agreement;
(ii) Such incapacities shall exist or be reasonably expected to exist
for more than one hundred eighty (180) days in the aggregate during the
period of twelve (12) consecutive months; and
(iii) Either the Employee or the Company shall have given the other
sixty (60) days written notice of his or its intention to terminate the
active employment of Employee because of such disability.
5. Termination.
5.1 Termination By Either Party Without Cause. At any time during the term
hereof, or at the end of the term or any renewal term under Section 1 above,
this Employment Agreement may be terminated "without cause" by either the
Company or the Employee upon sixty (60) days written notice to the other party.
(a) Termination By Employee. In the event of such termination "without
cause" by Employee, the Company shall have the option either (i) to accept
Employee's resignation, effective immediately on receipt of such written
notice; or (ii) to require Employee to continue to perform his duties
hereunder, for a period not to exceed six (6) months from the date of
receipt of such written notice.
In either event, the Employee's compensation and benefits hereunder
shall continue only until the date on which the Employee ceases to perform
any further duties for the Company.
(b) Termination By Company. In the event of such termination "without
cause" by the Company, Employee shall be continued at the same base salary
for a period of six (6) months from the date on which the Employee receives
written notice of termination. Such compensation shall be paid to the
Employee in six (6) equal, successive monthly payments, beginning on the
1st day of the month immediately following the date on which the Employee
receives written notice of termination.
Employee shall continue to make himself available to, and shall
cooperate with the Company, as may be reasonably required to assist the
Company during the six-month transition period.
(c) In the event Employee's employment hereunder is terminated by the
Company "without cause" pursuant to this Section 5.1(b), during the first
three (3) years after a "Change of Control," as defined in Annexure A, has
occurred, then the provisions of Section 5.3(b) shall apply.
2
5.2 Termination By Company For Cause.
Notwithstanding any other provision hereof, the Company may terminate
Employee's employment under this Agreement at any time for cause. The
termination shall be effected by written notice thereof to the Employee,
which shall specify the exact cause for termination.
Upon such valid termination for cause by the Company, Employee shall
not receive any termination pay or benefits beyond the date on which he
receives final written notice of termination.
5.3 Termination By Employee For Cause.
(a) Notwithstanding any other provision hereof, Employee may terminate
his employment with Company under this Agreement at any time for cause and
no later than three (3) years after such cause has occurred, upon written
notice thereof to the Company specifying the exact cause for Employee's
termination.
(b) In the event of termination by the Employee for cause
hereunder:
(1) All of Employee's (including Employee's trusts and
foundations) unvested stock and stock options shall immediately vest
100% and Employee (including Employee's trusts and foundations) shall
have the option to either (a) receive an immediate payment of the
Stock Value of 100% of his Stock and the higher of (i) the value
according to the Black and Scholes model, or (ii) the "in-the-money
value" of his stock options/warrants as of the date of such written
notice, or (b) receive an immediate cash bonus from the Company
enabling Employee (including Employee's trusts and foundations), after
full payment of all of Employee's (including Employee's trusts and
foundations) taxes on such cash bonus, to exercise 100% of his stock
options/warrants, and to continue to hold his Stock, with the right to
"put" or sell the Stock back to the Company for cash at Stock Value.
This right to "put" or sell the Stock back to the Company shall be in
full force and effect and valid and exercisable at any time and as how
many times as Employee wishes, in whole or in part, within three (3)
years after Employee's termination for cause, at Employee's (including
Employee's trusts and foundations) sole election.
(2) A lump sum cash retirement benefit payment of three (3) times
the Employee's then current annual salary plus three (3) times the
Employee's average bonus for the last three years shall be made to
Employee within 30 days of such written notice.
(3) Employee may also, in addition to, and not in limitation of
payments under Section 5.3(b)(1) and Section 5.3(b)(2) hereunder, at
his sole option, elect to serve as a consultant to Company (working
from his then current residence) for an additional period of three (3)
years at his then current salary, his previous year's bonus and
current benefits, including but not limited to reimbursement of all
Reasonable Expenses. During such consulting period, Employee would be
required to keep himself reasonably available to the Company to render
advice or to provide services for no more than thirty (30) days per
year.
(4) Employee (including Employee's trusts and foundations) shall
be made whole on an after-tax basis (in a timely fashion and in a way
not to create any liability for Employee, including Employee's trusts
and foundations) with respect to any taxes that might become payable
as a result of any action or provision in connection with a Change of
Control.
5.4 Effective Date of Termination. Unless otherwise specified, the
effective date of termination, as used in this Section 5, shall be the date on
which Employee receives written notice of termination from the Company or gives
written notice of termination to the Company.
3
6. Indemnification.
So long as Employee is not found by a court of law to be guilty of a
willful and material breach of this Agreement, or to be guilty of willful gross
misconduct, he shall be indemnified by the Company from and against any and all
losses, liability, claims and expenses, damages, or causes of action,
proceedings or investigations, or threats thereof (including reasonable attorney
fees and expenses of counsel satisfactory to and selected by Employee) incurred
by Employee, arising out of, in connection with, or based upon Employee's
services and the performance of his duties pursuant to this Employment
Agreement, or any other matter contemplated by this Employment Agreement,
whether or not resulting in any such liability; and Employee shall be reimbursed
by the Company as and when incurred for any reasonable legal or other expenses
incurred by Employee in connection with investigating or defending against any
such loss, claim, damage, liability, action, proceeding, investigation or threat
thereof, or producing evidence, producing documents or taking any other action
in respect thereto (whether or not Employee is a defendant in or target of such
action, proceeding or investigation).
7. Burden and Benefit.
Unless the express provisions of a particular section of this Agreement
state otherwise, or performance thereunder would be impossible, this Agreement
shall be binding upon, and shall inure to the benefit of, Employer and Employee,
and their respective heirs, personal and legal representatives, successors, and
assigns. It shall also be expressly binding upon and inure to the benefit of any
person or entity assuming the Corporation/Company, by merger, consolidation,
purchase of assets or stock, or otherwise. The interests of the Employee
hereunder are not subject to the claims of his creditors, and may not be
voluntarily or involuntarily assigned, alienated or encumbered; provided, that
Employee may assign all or any part of his rights, duties and obligations
hereunder to any entity (e.g., a partnership or management company) so long as
the services to be performed hereunder are personally performed by him.
8. Governing Law.
It is understood and agreed that the construction and interpretation of
this Agreement shall at all times and in all respects be governed by the laws of
the country of the Company's and/or the Employee's residence. The Company agrees
to cover all costs, including legal, arising in connection with drafting,
interpreting and implementing this Employment Agreement, both for the Company
and for Employee.
9. Severability.
The provisions of this Agreement shall be deemed severable, and the
invalidity or unenforceability of any one or more of the provisions of this
Agreement shall not affect the validity and enforceability of the other
provisions.
10. Notice.
Any notice required to be given hereunder shall be sufficient if it is
in writing and sent by certified or registered mail, return receipt requested,
first-class postage prepaid, to the following respective addresses, which may
hereafter be changed by written notice to the other party:
Employer: Century Casinos, Inc.
200 - 000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxx Xxxxx, XX. 00000
XXX
Employee: Xxxxx Xxxxxxxxxx
Johann Xxxxxxxxxxxxxx 00
X-0000 Xxxxxx
Xxxxxxx / Europe
4
11. Interpretation, Adjustments.
11.1 No representations, promises, agreements, or understandings, written
or oral, not contained herein shall be of any force or effect. No change or
modification of this Agreement shall be valid or binding unless it is in writing
and signed by the party intended to be bound. No waiver of any provision of this
Agreement shall be valid unless it is in writing and signed by the party against
whom the waiver is sought to be enforced. No valid waiver of any provision of
this Agreement at any time shall be deemed a waiver of any other provision of
this Agreement at such time or at any other time.
11.2 The Compensation Committee shall have absolute authority to amend,
interpret and administer this Agreement, in good faith, and in the best
interests of both the Company and Employee, and may make such adjustments or
amendments hereto as may be reasonably required, if the rights of the Employee
are not adversely affected thereby.
12. Confidentiality.
Other than in the performance of his duties hereunder, Employee agrees not
to disclose, either during the term of his employment by the Company or at any
time thereafter, to any person, firm or corporation any confidential information
concerning the business affairs, financial affairs, know-how, private documents,
reports, plans, proposals, marketing and sales plans, or similar information of
the Company. Any such documents, techniques, methods, processes or technologies
used by the Company shall be considered confidential and a "trade secret" for
the purposes of this Agreement.
13. Counterparts and Annexure.
The Agreement may be executed in two or more counterparts, any one of which
shall be deemed the original without reference to the others. Annexure A
(Definitions) shall be an integral part of this Agreement and the Agreement
shall not be complete without it.
IN WITNESS WHEREOF, Employer and Employee have duly executed this
Agreement as of the day and year first above written.
EMPLOYER:
CENTURY CASINOS, INC.
/s/ Xxxxx Haitzmann
By: __________________________________
Chairman, Compensation Committee
/s/ Xxxxx Xxxxxxx
By: __________________________________
Member, Compensation Committee
EMPLOYEE:
/s/ Xxxxx Xxxxxxxxxx
By: __________________________________
Xxxxx Xxxxxxxxxx
5
ANNEXURE A
Definitions:
As used in this Agreement, the following terms shall have the respective
meanings indicated.
Reasonable Expenses. Reasonable expenses shall include, but not be limited to,
all out-of-pocket expenses for entertainment, travel (economy flights within the
USA, wherever reasonably available, business class on other continental flights,
and one class above business class on inter-continental long distance flights),
meals, lodging, automobile expenses, communications and office costs and the
like incurred by the Employee.
Cause (as used in 5.2). For purposes hereof, the term "cause" shall mean the
failure of Employee for any reason, within thirty (30) days after receipt by
Employee of written notice thereof from the Company, to correct, cease, or
otherwise alter (i) any specific action or omission to act that constitutes a
material and willful breach of this Agreement likely to result in material
damage to the Company; or (ii) any willful gross misconduct likely to result in
material damage to the Company.
Cause (as used in 5.3). For purposes hereof, the term "for cause" shall mean:
(i) the failure of the Company for any reason, within thirty (30) days after
receipt by the Company of written notice from Employee, to correct, cease, or
otherwise alter any material adverse change in the conditions of Employee's
employment, including, but not limited to any change in Employee's title or
position, or the duties of such position (such as, but not limited to another
person assuming the same or similar title, position or duties, or one or more of
the Employee's primary duties being assigned to be performed by the Employee in
a country other than his country of primary residence), unless Employee consents
in writing to such change; or (ii) a "Change of Control" of the Company occurs,
or has previously occurred at any time during Employee's employment hereunder.
"Change of Control" as used herein shall mean any of the following: (a) any
person or entity (not affiliated with the Employee) becoming the beneficial
owner of a majority of the voting rights of the Company's then outstanding
securities; (b) the triggering of the issuance of stock rights to Shareholders
pursuant to the Company's Stock Rights Agreement, as amended from time to time;
(c) the replacement during any two calendar years of half or more of the
existing Board of Directors of the Company; (d) the replacement, or rejection
(i.e. through a proxy fight), of one or more person(s), nominated to be
Director(s) by the Company's Board of Directors before any Change of Control;
(e) the election of one or more persons to the Company's Board of Directors that
have not been nominated by the Company's Board of Directors before any Change of
Control; (f) Xx. Xxxxx Haitzmann is no longer Chairman of the Company, unless
because of his death or permanent disability; (g) holders of the Company's
securities approve a merger, consolidation or liquidation of the Company.
Stock Value. The Stock Value shall be calculated according to the provisions of
the Company's Certificate of Incorporation, article NINTH, C. (b) (i) (a) to
(D). The reference to these provisions in the Company's Certificate of
Incorporation shall be applicable for the one and only reason of determining the
Stock Value.
Stock. The term "Stock" shall include any and all shares of common and/or stock
awards (whether restricted or not) and/or preferred stock of the Company and of
any subsidiary of the Company owned by the Employee (including Employee's trusts
and foundations), no matter how and when acquired (including through exercise of
options and/or warrants).
---------------------------------------------
6
