Exhibit 10.1
EXECUTIVE EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT AGREEMENT (this
“Agreement”) is made and entered into as of this first
day of January 2006 (the “Effective Date”), by and
among VIRGIN RIVER CASINO CORPORATION, a Nevada corporation, RBG,
LLC, a Nevada limited liability company, and CASABLANCA RESORTS,
LLC, a Nevada limited liability company (collectively, the
“Company”), and Curt Mayer (the “ Executive”).
RECITALS
WHEREAS, the Company desires to
employ the Executive on the terms and conditions set forth herein;
and
WHEREAS, the Executive desires to
accept employment with the Company on the terms and conditions set
forth herein.
NOW, THEREFORE, in consideration of
the promises and mutual covenants contained herein and for other
good and valuable consideration, the Company and the Executive
(each a “ Party ” and collectively the “
Parties ” ) agree that the foregoing recitals
are true and as follows:
AGREEMENT
1.
DEFINITIONS: In addition to certain terms defined elsewhere in this
Agreement, the following terms shall have the following respective
meanings:
1.1
“ Affiliate ” shall mean any Person who
controls, is controlled by, or is under common control with the
Company.
1.2
“ Annual Review ” shall have the meaning as
provided in Section 3.1.
1.3
“ Base Salary ” shall have the meaning as
provided in Section 3.1.
1.4
“ Buyout Payment ” shall have the meaning as
provided in Section 7.
1.5
“ Cause ” shall mean that the
Executive:
(a)
has been formally charged with or convicted of any felony,
including any crime involving fraud, theft, embezzlement,
dishonesty or moral turpitude during the Term;
(b)
has been found unsuitable to hold a gaming license by a Gaming
Authority;
(c)
has failed to abide by the Company’s policies and procedures
that are reasonably and consistently enforced;
(d)
has engaged in misconduct, failed to follow a reasonable directive,
including any reasonable directive given by the Board, or engaged
in material inattention to the Company’s business;
(e)
has failed to perform the duties required of the Executive up to
the standards established by the Company;
(f)
has materially breached this Agreement;
(g)
has engaged in acts or omissions that constitute gross negligence
or willful misconduct resulting, in either case, in material
economic harm to the Company; or
(h)
has engaged in excessive absenteeism.
1.6
“ Change in Control ” shall be deemed to have
occurred if (a) there is a sale or exchange of outstanding stock of
any class, as applicable, or membership interest in the Company to
a third party, the result of which leaves the Existing Majority
Equity Holder with less than 50% of the beneficial ownership in the
surviving entity(ies); (b) there is a sale of all or substantially
all of the assets of the Company; or (c) Robert R. Black, Sr. is no
longer the Chief Executive Officer or equivalent of the Company as
a going gaming concern. For purposes of this Section 1.6,
“beneficial ownership” shall have the same meaning as
defined in Rules 13d-13d-5 under the Securities Exchange Act of
1934, as amended, except that a Person shall be deemed to have
“beneficial ownership” of all shares or membership
interest that any such Person has the right to acquire, whether
such right is immediately exercisable or only after the passage of
time.
1.7
“ Company Property ” shall mean all items and
materials that are created, compiled, existing, or received by the
Company during the course of the Executive’s employment with
the Company, all items and materials provided by the Company to the
Executive, or to which the Executive has access, in the course of
his employment, including, without limitation, all files, records,
documents, drawings, specifications, memoranda, notes, reports,
manuals, equipment, computer disks, videotapes, drawings,
blueprints, other similar items relating to or emanating from the
Company, its Affiliates or their respective customers, whether
prepared by the Executive or others, and any and all copies,
abstracts and summaries thereof.
1.8
“ Competing Business ” shall mean any Person
engaged in the gaming industry that directly or through an
Affiliate conducts its gaming business within the Restricted
Area.
1.9
“ Confidential Information ” shall mean all nonpublic and/or
proprietary information respecting the business of the Company or
any Affiliate, including, without limitation, its patrons, customer
lists, products, programs, projects, promotions, marketing plans
and strategies, business plans or practices, business operations,
employees, invitees, research and development products or
information, intellectual property, software, databases,
trademarks, pricing information and accounting and financing data.
Confidential Information also shall include information concerning
the Company’s or any Affiliate’s customers, such as
their identity, address, preferences, playing patterns and ratings
or any other information kept by the Company or any Affiliate
concerning its customers regardless of whether such information has
been reduced to documentary or tangible form. Confidential
Information does not include information that is, or becomes,
available to the general public unless such availability occurs
through an unauthorized act on the part of the
Executive.
1.10
“ Disability ” shall mean a physical or mental
incapacity that occurs during the Term that prevents the Executive
from performing, with reasonable accommodation, the essential
functions of his position with the Company for a minimum period of
ninety (90) days. In the Event of Disability, the Executive hereby
agrees to submit to medical examinations by a licensed healthcare
professional selected by the Company, in its sole discretion, to
determine whether a Disability exists. In addition, the Executive
may submit to the Company documentation of a Disability, or lack
thereof, from a licensed healthcare professional of his choice.
Following a determination of a Disability or lack of Disability by
the
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Company’s or the
Executive’s licensed healthcare professional, the other Party
may submit subsequent documentation relating to the existence of a
Disability from a licensed healthcare professional selected by such
other Party. In the event that the medical opinions of such
licensed healthcare professionals conflict, such licensed
healthcare professionals shall appoint a third licensed healthcare
professional to examine the Executive, and the opinion of such
third licensed healthcare professional shall be
dispositive.
1.11
“ Existing Majority Equity Holder ” shall mean
Robert R. Black, Sr.
1.12
“ Gaming Authorities ” shall mean the federal,
state and local governmental, regulatory and administrative
authorities, agencies, boards and officials responsible for or
involved in the regulation of gaming or gaming activities in any
jurisdiction and, within the State of Nevada, specifically, the
Nevada Gaming Commission and the Nevada State Gaming Control
Board.
1.13
“ Good Reason ” shall mean and exist if, without
the Executive’s prior written consent, one or more of the
following events occurs:
(a)
the Executive is given or is assigned significant duties or
responsibilities that are inconsistent, in any material respect,
with the position of Chief Financial Officer;
(b)
the Executive is required to relocate from, or maintain his
principal office outside of, Clark County, Nevada;
(c)
the Company fails to agree to or to actually indemnify the
Executive for his actions and/or inactions, as either a director or
an officer of the Company, in accordance with Nevada law and
specifically NRS Chapter 78 and NRS Chapter 86, as applicable,
and/or the Company fails to maintain commercially reasonable levels
of directors’ and officers’ liability insurance
coverage for the Executive when such insurance is
available.
1.14
“ Long Term Incentive Awards ” shall have the
meaning as provided in the Long Term Incentive Plan.
1.15
“ Long Term Incentive Plan ” or “
LTIP ” shall mean the long term incentive plan as that
plan is eventually formulated and implemented by the
Company.
1.16
“ Membership Interest ” shall mean the
membership interest held by any member of the Company.
1.17
“ NRS ” shall mean the Nevada Revised Statutes,
as amended.
1.18
“ Person ” shall mean a natural person, any form
of business and any other non-governmental legal entity including,
but not limited to, a corporation, partnership, trust, or limited
liability company.
1.19
“ Restricted Area ” shall mean the area within a
25 mile radius of any casino operated by the Company or any of its
affiliates or within a 25 mile radius of any site for which the
Company or any of its affiliates has applied for a gaming license
during the Restriction Period.
1.20
“ Restriction Period ” shall mean the period
expiring at 11:59 p.m. on that date immediately preceding the two
(2) year anniversary of the effective date of (a) the termination
of this Agreement by the Company for Cause; or (b) the termination
of this Agreement by the Executive without
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Good Reason. Provided that the
Restriction Period shall be one hundred eighty (180) days in the
event that Executive is terminated by the Company Without Cause
pursuant to Section 6.3.
1.21
“ Term ” shall have the meaning as provided in
Section 2.2.
1.22
“ Voting Stock ” shall mean capital stock of any
class or classes having general voting power under ordinary
circumstances, in the absence of contingencies, to elect the
directors of a corporation.
2.
TERM; POSITION AND RESPONSIBILITIES.
2.1
Employment Accepted. The Company hereby employs the
Executive, and the Executive hereby accepts employment with the
Company, for the Term, in the position and with the
responsibilities set forth in Section 2.3 and upon such other terms
and conditions as are stated in this Agreement.
2.2
Term. This Agreement shall be for a term of three (3) years
commencing on the Effective Date and expiring at 11:59 p.m. on that
date immediately preceding the three (3) year anniversary of the
Effective Date, unless earlier terminated as provided herein (the
“ Term ”).
2.3
Responsibilities. During the Term, the Executive shall be
employed as Chief Financial Officer of the Company and shall have
such responsibilities as are commensurate with the title of Chief
Financial Officer. During the Term, the Executive shall devote his
full time and attention to the business and affairs of the Company
and shall use commercially reasonable efforts, skills and abilities
to promote the Company’s interests. Anything set forth herein
to the contrary notwithstanding, the Executive shall not be
precluded from engaging in charitable and community affairs and
managing his personal investments.
3.
COMPENSATION.
3.1
Base Salary. During the Term, the Executive shall be
entitled to a base salary (the “ Base Salary ”
) payable no less frequently than in equal bi-weekly
installments (each, an “ Installment ” )
at an annualized rate of TWO HUNDRED TWELVE THOUSAND DOLLARS
($212,000.00). During the Term, the Base Salary shall be reviewed
annually for increase (but not decrease) by the Company, and any
such increase shall be at the sole discretion of the Company. In
conducting such annual review (the “ Annual Review
”), the Company shall take into account any change in the
Executive’s responsibilities, increases in the compensation
of other executives of the Company or of any Affiliate (or of any
competitor(s) of either or both), the performance of the Executive
and/or any other pertinent factors. if an increase is approved by
the Company, then such increased Base Salary shall then constitute
the Executive’s “Base Salary” for purposes of
this Agreement.
3.2
Bonus. In addition to the Base Salary, Executive shall be
entitled to an Annual Calendar Year Bonus of ONE HUNDRED THOUSAND
($100,000.00) (“Bonus”). The Bonus shall be paid no
later than February 28 of the subsequent year in which the Bonus
was earned.
3.3
LTIP. The Executive is eligible to participate in the LTIP
as it is eventually formulated and implemented by the
Company.
4.
PENSION AND WELFARE BENEFIT PLANS AND OTHER PLANS. Beginning on the
Effective Date, the Executive shall be entitled to participate in
all employee benefit programs and plans, consistent with the terms
of such programs and plans, made available to the Company’s
executives or salaried employees generally, as such programs may be
in effect from time to time. Provided that, in the
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event the Company implements an
Annual Incentive Plan, (AIP), Executive shall not participate in
the AIP in any manner.
5.
BUSINESS EXPENSE REIMBURSEMENT AND PERQUISITES.
5.1
Expense Reimbursement. During the Term, and in accordance
with applicable company policies, the Executive shall be entitled
to receive reimbursement by the Company for all reasonable
out-of-pocket expenses incurred by him in performing services under
this Agreement and in relation to the Company, subject to providing
reasonable documentation of such expenses.
5.2
Perquisites. During the Term, the Executive also shall be
entitled to any of the Company’s executive perquisites in
accordance with the terms and provisions of the applicable
policies. Executive shall be entitled to participate in all PTO and
Vacation programs, consistent with the terms of such programs, made
available to the Company’s executives or salaried employees
generally, as such programs may be in effect from time to
time.
6.
TERMINATION OF EMPLOYMENT.
6.1
Termination Due to Death or Disability. The
Executive’s employment shall be terminated immediately in the
event of his death or Disability. In the event of a termination due
to the Executive’s death or Disability, the Executive or his
estate, as applicable, shall be entitled, in lieu of any other
compensation whatsoever, to the following:
(a)
any earned and non-paid Installment of Base Salary at the rate in
effect at the time of his termination through the date of
death;
(b)
reimbursement of expenses incurred but not paid prior to such
termination of employment;
(c)
such rights to other benefits as may be provided in applicable
plans and programs of the Company, according to the terms and
provisions of such plans and programs;
(d)
all target compensation associated with the LTIP calculated pro
rata for the portion of the fiscal year prior to the
Executive’s death or Disability; and
(e)
all accrued but unpaid bonus prior to the date of the
Executive’s death or Disability.
6.2
Termination by the Company for Cause. The Company may
terminate the Executive’s employment for Cause at any time
during the Term by giving written notice to the Executive of the
Company’s intention to terminate his employment for Cause.
Such written notice shall describe with reasonable specificity (a)
the particular act, acts, or omission that provides the basis of
the Company’s termination of the Executive for Cause; and (b)
one or more reasonable and acceptable remedy(ies) for such act,
acts or omission. Unless the Company, in good faith, reasonably
determines that the Executive’s act, acts, or omission is
incapable of correction, which may include but are not limited to
those acts set forth 1.5 above, the Executive shall be given thirty
(30) calendar days from the receipt of such notice to cure such
act, acts, or omission as stated in the notice. During such cure
period, the Executive shall be given the reasonable opportunity to
meet with the Existing Majority Equity Holder to defend such act,
acts, or omission. During such cure period, the Executive shall
continue to be paid his Base Salary. If after thirty (30) calendar
days, in the sole discretion of the Company, the Executive is
unable to cure such act, acts, or omission that was the written
basis for termination by the Company for Cause, then the
Executive’s employment with the Company automatically shall
be terminated under this Subsection 6.2
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for Cause. In the event of a
termination for Cause, the Executive shall be entitled, in lieu of
any other compensation and benefits whatsoever, to the
following:
(a)
any earned and non-paid Installment of Base Salary at the rate in
effect at the time of his termination through the date of
termination of employment;
(b)
reimbursement of expenses incurred but not paid prior to such
termination of employment; and
(c)
such rights to other benefits (except for Bonus) as may be provided
in applicable plans and programs of the Company, according to the
terms and conditions of such plans and programs.
Notwithstanding the foregoing, the
Company may immediately terminate the Executive for Cause, and
there shall be no cure period if the Executive is unable to perform
the essential functions of his job for a period of ninety (90)
consecutive days.
6.3
Termination by the Company Without Cause. Notwithstanding
any other provision of this Agreement, the Company may terminate
the Executive’s employment without Cause, other than due to
death or Disability, at any time during the Term by giving thirty
(30) days’ written notice to the Executive or payment in lieu
of notice. In the event that the Company terminates the
Executive’s employment without Cause and subject to Section 7
hereof, the Executive shall be subject to and shall be entitled, in
lieu of any other compensation and benefits whatsoever,
to:
(a)
in addition to any earned and non-paid Installment of Base Salary
at the rate in effect at the time of his termination through the
date of termination of employment, an amount equal to either: forty
percent (40%) of Executive’s Base Salary in effect at the
time of termination and forty percent (40%) of a pro rata portion
of the Bonus or the balance of Base Salary still unpaid for the
remaining Term of this Agreement plus the applicable amount of the
Bonus, whichever is smaller.
(1)
one hundred percent (100%) of the foregoing payment (set out in
Section 6.3(a)) shall be made by the Company to the Executive in a
lump sum upon satisfaction of the conditions set forth in Section
8.3;
(b)
reimbursement for expenses incurred but no paid prior to such
termination of employment.
(c)
such rights to other benefits as may be provided in applicable
plans and programs of the Company, according to the terms and
conditions of such plans and programs; and
(d)
Executive shall be subject to the Restriction Area and the
Restricted Period provision set forth herein in Sections 1.19 and
1.20 respectively.
6.4
Termination by the Executive for Good Reason. The Executive
may terminate his employment for Good R
