Exhibit 10.2
AMENDED EMPLOYMENT
AGREEMENT
This AMENDED
EMPLOYMENT AGREEMENT (the “Agreement”) made effective
as of the 1 st day of January, 2009
(“Effective Date”) by and between the MOHEGAN TRIBAL
GAMING AUTHORITY (the “Employer”), an instrumentality
of THE MOHEGAN TRIBE OF INDIANS OF CONNECTICUT (the
“Tribe”), a sovereign Indian nation, having an address
of One Mohegan Sun Boulevard, Uncasville, Connecticut 06382, and
JEFFREY E. HARTMANN, residing at 5 Cord Grass Lane, Old Lyme,
Connecticut 06371 (“Executive”).
WITNESSETH:
WHEREAS, the Employer owns and
operates, among other things, the Mohegan Sun casino and resort in
Uncasville, Connecticut, a harness racetrack located in Wilkes
Barre, Pennsylvania known as Pocono Downs, along with several
off-track wagering facilities located in the State of Pennsylvania,
as well as investments in other proposed gaming enterprises and
other businesses (as presently existing and hereafter developed,
the “Business”); and
WHEREAS, the Employer and Executive
entered into that certain Employment Agreement dated and effective
May 8, 2006 providing for the continued employment of
Executive by the Employer (the “2006 Agreement”);
and
WHEREAS, the parties hereto have
agreed to amend the 2006 Agreement to establish that (a) the
guaranteed bonuses set forth in the 2006 Agreement shall be made
part of the Executive’s Annual Base Salary, (b) the
Executive shall receive payment of $25,000 as part of his
Annual Base Salary in lieu of the Employer’s contributions to
premiums for a life insurance policy covering the Executive under
the 2006 Agreement, (c) the Executive has agreed to forego the
annual salary increase of at least five percent (5%) of his
prior year’s Annual Base Salary under the 2006 Agreement for
the year commencing on the Effective Date, (d) the Executive
has agreed to reduce his Annual Base Salary under the 2006
Agreement by ten percent (10%) for the year commencing on the
Effective Date, (e) the Employer has agreed to extend the term
of Executive’s contract for six (6) months, until
June 30, 2012, and (d) the Employer has agreed to a
reduction of the “Restricted Period” regarding
constraints on Executive’s competitive employment to
December 31, 2012 in the event that his employment with
Employer ends at any time from January 1, 2012 through
June 30, 2012.
NOW, THEREFORE, in consideration of
the promises and the mutual covenants, terms and conditions
hereinafter set forth, and for other good and valuable
consideration, receipt whereof is specifically acknowledged, the
parties hereto hereby agree as follows:
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1.
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Effective
Date of Agreement .
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Executive and Employer mutually
agree that this Agreement is effective on the Effective
Date.
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2.
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Nature of
Services and Duties .
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(A) The Employer hereby agrees to
employ Executive as its Executive Vice President and Chief
Operating Officer upon the terms set forth herein, and Executive
hereby accepts such employment.
(B) Executive shall perform such
duties and services of an executive, managerial and administrative
nature as are customary for an executive vice president and chief
operating officer and which, consistent with the foregoing, the
Employer may from time to time through communication from the Chief
Executive Officer hereafter assign to him. Such duties shall
include, but not be limited to, the following: (i) in
coordination with the Chief Executive Officer and the Chief
Financial Officer of the Employer, oversee the financial reporting
and treasury activities of the Employer, the strategic direction of
the Employer’s business development, and the financial
performance of the Business; (ii) in coordination with the
Chief Executive Officer and the respective Vice Presidents (or
Directors) of the Strategic Planning and Forecasting, Information
Systems, Hotel Resort Operations, Slot Operations, Racebook and
Keno Operations, Table Games Operations, and Finance divisions of
Mohegan Sun, oversee the operations of such divisions of Mohegan
Sun; and (iii) attend professional training and continuing
professional education events as approved by the Chief Executive
Officer. Executive shall report exclusively to the Chief Executive
Officer of the Employer. The Employer shall not restrict, reduce or
otherwise limit Executive’s responsibility or authority
without his consent.
(C) Executive shall devote his best
efforts and ability and all required business time to the
performance of his duties and responsibilities hereunder to achieve
the goals set forth in the Employer’s annual business plan.
Executive shall perform all of his duties to the Employer
faithfully, competently, and diligently.
(D) Except for actions of the
Executive that could be the basis for termination for Cause as set
forth in Paragraph 6(C) below, the Employer shall indemnify,
defend, and hold Executive harmless, including the payment of
reasonable attorney fees, if the Employer does not directly provide
Executive’s defense, from and against all claims made by
anyone, including, but not limited to, a corporate entity, company,
other employee, agent, patron, tribal member, or any member of the
general public with respect to any claim that asserts as a basis,
any acts, omissions, or other circumstances involving the
performance of Executive.
This Agreement shall
govern Executive ’ s employment with the Employer
from the Effective Date through and including June 30, 2012.
This Agreement, including this paragraph, shall automatically renew
for an additional term of five years unless either party shall
notify the other of its intention to terminate, or unless otherwise
terminated as provided herein. Any such
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notice of intention to terminate shall be
delivered no later than one hundred and twenty (120) days
prior to the end of the then current term and shall be effective at
the end of such term, except as otherwise provided
herein.
Commencing with the Effective Date
and through December 31, 2009, the Employer shall pay
Executive a base annual salary (“Base Annual Salary”)
of $1,285,565.49, payable in equal weekly installments of
$24,722.41 each. Commencing January 1, 2010, and on each
January 1 thereafter during the term of this Agreement, the
then current Base Annual Salary shall be increased in an amount
mutually agreed to by Executive and the Employer, which amount
shall in no event be less than 5% of the then current Base Annual
Salary.
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5.
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Reimbursement of Certain Expenses; Vacation;
Medical Benefits .
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(A) The Employer will reimburse
Executive for necessary and reasonable business expenses incurred
by him in the performance of his duties hereunder, provided, that
he shall obtain the approval for such expenditures in accordance
with the procedures adopted by the Employer from time to time and
generally-applicable to its executive-level employees, including
such procedures with respect to submission of appropriate
documentation and receipts. Failure by Executive to follow such
procedures shall entitle the Employer to refuse to reimburse
Executive for such expenses until such time as such failure has
been cured. It is understood and agreed that Employer shall not be
responsible for any expense of Executive for leasing or operation
of a vehicle for Executive (except that Executive shall be entitled
to reimbursement for the expenses, including mileage, actually
incurred in connection of his use of his automobile for the
business-related purposes of the Employer), nor for any expense of
Executive for legal expenses or tax planning expenses incurred by
Executive in interpreting this or any other agreement between
Executive and Employer.
(B) Executive shall be entitled to
four weeks paid vacation per fiscal year (at least two weeks of
which is recommended to be taken in 14 consecutive
days).
(C) Executive shall participate in
such employee benefit plans and programs (including but not limited
to medical insurance programs) as are now or may hereafter be
adopted by the Employer for its executive employees and their
families. Employer shall continue to provide such medical insurance
coverage for a period of one (1) year (not to be included as
COBRA coverage) after any termination by Employer of
Executive’s employment hereunder if such termination was
without Cause, as hereinafter defined.
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6.
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Disability;
Termination .
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(A) If Executive shall become unable
to perform all of his duties set forth in Paragraph 2 of this
Agreement due to mental or physical disability, all compensation
and benefits provided in this Agreement shall continue to be paid
and provided in full for a period not exceeding one hundred and
eighty (180) consecutive days. Upon completion of such one
hundred and eighty (180) days (or if Executive shall be
disabled for an aggregate period of one
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hundred and eighty (180) days in any period
of three hundred and sixty (360) consecutive days by the same
incapacity) the Employer may, at its sole option, suspend
Executive’s employment until Executive is recovered from such
mental or physical disability (as reasonably certified by a
physician designated by the Employer and reasonably satisfactory to
Executive). During any period of suspension on account of
disability, Executive shall receive only such compensation as may
be provided under the disability insurance described in Paragraph
6(B). If the physician designated by the Employer certifies that
Executive is permanently disabled, Employer’s obligations
under this Agreement shall cease, provided, however, that Executive
shall be entitled to the disability benefits set forth in Paragraph
6(B) below.
(B) Employer, at the sole expense of
Employer, shall provide disability insurance coverage for
Executive. Such policy shall provide payment of 50% of Base Annual
Salary commencing with the suspension or termination of employment
pursuant to Paragraph 6(A) above by reason of physical or mental
disability and for a period of two (2) years if such
disability was the result of injury and to age 65 if such
disability was the result of physical or mental illness. In the
event the Employer is unable to obtain disability insurance in the
amount required, or is unable to obtain all or part of such
insurance at standard rates, the Employer shall at its option
obtain part or all of such insurance at non-standard rates or shall
self-insure in whole or in part for the time periods set forth in
this paragraph.
(C) Subject to the provisions of
this paragraph, the Employer may terminate Executive’s
employment for Cause, defined as (i) Executive’s
violation of the Restrictive Covenants as defined in Paragraph 9 of
this Agreement, (ii) the loss or suspension by the State of
Connecticut of Executive’s license for Class III gaming for a
period of thirty (30) consecutive days,
(iii) Executive’s conviction of any crime involving
fraud, theft or moral turpitude, or (iv) Executive’s
intentional material breach of his obligations under this Agreement
in order to cause the Employer, acting through the Chief Executive
Officer, to terminate Executive. Employer may suspend Executive
without pay upon Executive’s arrest for any alleged felony
against Employer or the Tribe. In the event that Executive is found
not guilty or otherwise exonerated for an alleged crime against
Employer or the Tribe, Executive’s suspended pay shall be
reimbursed to him.
In the event that Employer desires
to terminate Executive, the Employer shall give written notice
specifying the act(s) claimed to constitute Cause and specifying an
effective date of termination, which date shall be no sooner than
thirty (30) days after the giving of such notice. Upon the
written request of Executive, the Management Board of the Employer
shall meet with Executive to discuss the reasons for termination
and to provide Executive with an opportunity to respond. In the
event Executive fails to cure the act(s) claimed to constitute
Cause as set forth in the notice of termination, Executive will
cease employment with the Employer effective upon the date provided
in the notice of termination. If such termination is for Cause,
then Executive shall not be entitled to any further compensation
from and after the date of termination.
(D) Subject to the provisions of
this paragraph, the Employer may terminate Executive’s
employment other than for Cause, as defined above. In the event of
termination other than for Cause, Executive shall be paid,
following termination, his Base Annual Salary from the
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