EXHIBIT 10.34
EXECUTIVE EMPLOYMENT
AGREEMENT
(“Agreement”)
EXECUTIVE EMPLOYMENT AGREEMENT
signed September 23, 2009 by and between Jacobs
Entertainment, Inc., a Delaware corporation (the
“Company”) and Ian M. Stewart (the
“Executive”).
WHEREAS, the Company desires to
employ the Executive on a full-time basis, and the Executive
desires to be so employed by the Company, from and after the date
of this Agreement.
NOW, THEREFORE, in consideration of
the mutual covenants contained herein, the parties agree as
follows:
ARTICLE I
EMPLOYMENT DUTIES AND
BENEFITS
Section 1.1
Employment
. The Company hereby employs the Executive
as President of Pari-mutuel Wagering Operations of the
Company. The Executive accepts such employment and agrees to
perform the duties and responsibilities assigned to him under this
Agreement.
Section 1.2
Duties and
Responsibilities . During the period of employment,
Executive agrees to serve as the President of Pari-mutuel Wagering
Operations of the Company and in such other offices and
directorships of the Company and of its subsidiaries and related
companies (collectively, “affiliates”) to which he may
be elected or appointed, and to perform the duties commensurate
with such positions and such other reasonable and appropriate
duties as may be requested of him by the Chief Executive Officer of
the Company, in accordance with this Agreement and in compliance
with all applicable laws and regulations. Excluding periods
of vacation and sick leave to which Executive is entitled,
Executive shall devote such time, energy, and skill to the business
and affairs of the Company and its affiliates and to the promotion
of their interests as is necessary to perform the duties required
of him by this Agreement. The foregoing shall not be construed as
preventing Executive from serving on the board of philanthropic
organizations, or providing oversight with respect to his personal
investments, so long as such service does not materially interfere
with Executive’s duties hereunder. The Executive also may
serve as a member of the board of directors of other corporations,
subject to the approval of the Chief Executive Officer of the
Company, which approval shall not be unreasonably withheld or
delayed.
Section 1.3
Working Facilities;
Location . The Executive shall be furnished with
facilities and services suitable to his position and adequate for
the performance of his duties under this Agreement. The
principal place of performance by Executive of his duties hereunder
shall be at the offices of the Company in New Kent, VA or at such
other location as may reasonably be required to travel outside that
area in the performance of Executive’s
responsibilities.
Section 1.4
Vacations
. The Executive shall be entitled each year
during the Term, as defined below, to a vacation with full salary
and benefits, for the number of weeks set forth in the
Company’s Employee Handbook.
Section 1.5
Vehicle
Allowance . The Executive shall be paid a vehicle
allowance of approximately $1,000 per month, or at his election,
the Company shall lease for not more than $600 per month a vehicle
suitable for travel in Virginia in all weather
conditions.
Section 1.6
Expenses
. The Executive is authorized to incur
reasonable expenses for promoting the business of the Company in
all respects, including expenses for entertainment, travel and
similar items. The Company will promptly reimburse the
Executive for all such expenses upon the presentation by the
Executive, from time-to-time, of an itemized account of such
expenditures. The Company shall pay or promptly reimburse the
Executive for all licensing (both gaming and professional) costs
and expenses including continuing professional education and
professional liability insurance.
Section 1.7
Benefit Plans
. From the effective date of this
Agreement, the Executive shall be entitled to participate in
benefit plans provided to employees of the Company. Such
participation shall be based upon the policies established in the
Company’s Employee Handbook as applicable to the
Executive.
ARTICLE II
COMPENSATION
Section 2.1
Base Salary
. Beginning in the first year of this
agreement, the Company shall pay to the Executive a Base Salary of
$300,000 through the final year of this Agreement with annual pay
increases of at least 3% each year based upon the prior
year’s base salary payable in accordance with the
Company’s payroll and withholding policies.
Section 2.2
Bonus and Bonus Plan
Participation . The Executive is entitled to participate
in a bonus plan or incentive plan as formulated by the
Company’s Board of Directors, Compensation Committee or Chief
Executive Officer and/or President. Within 60 days after the
date of this Agreement, and at the beginning of each calendar year
thereafter during the Term hereof, the Chief Executive Officer of
the Company shall establish written goals and performance criteria
for the Executive. If such goals and performance
criteria for the Executive are met for a particular year, the
Executive shall be entitled to a bonus of up to 35% of his Base
Salary. Subject to Sections 3.3 and 3.4, the bonus shall be
payable only if the Executive is employed by the Company at
December 31 of each year for which the bonus is
determined. In addition, the Executive is entitled to a bonus
of 5% of the Colonial Downs EBITDA in excess of $2,000,000 for the
years ended December 31, 2010, 2011 and 2012.
ARTICLE III
TERM OF EMPLOYMENT AND
TERMINATION
Section 3.1
Term
. This Agreement shall be for a period
commencing on August 1, 2009 and ending December 31,
2012, subject, however, to earlier termination during such period
as provided in this Article (the
“Term”).
Section 3.2
Termination by the Company
With Cause . The Company may terminate the
Executive’s employment, at any time, for cause upon ten
days’ written notice and opportunity for the Executive to
remedy any non-compliance with the terms of this Agreement (if such
non-compliance can be remedied). Grounds for termination
“for cause” shall be one or more of the
following: (i) intentional and material breach of his
duty of loyalty or care to the Company, (ii) gross negligence
or willful misconduct in performance of his duties during the
course of his employment, (iii) failure to abide by the
corporate policies and procedures set forth in the Company’s
Employee Handbook; (iv) failure to execute the reasonable and
lawful instructions of the Company’s Chief Executive Officer
and/or President relating to the operation of the Company’s
business; (v) failure to obtain within a reasonable time any
required gaming licenses in Colorado, Nevada or any jurisdiction in
which the Company conducts business; (vi) conviction of any
felony crime or loss or material impairment of his gaming license
in Colorado, Nevada, or any jurisdiction in which the Company
conducts its business; and (vii) Executive’s inability
to perform his duties hereunder for a period of more than 30 days
because of a restraining order, injunction or other legal
prohibition. Upon the date of termination of the
Executive’s employment pursuant to this Section 3.2, the
Company’s obligation to pay any compensation including
bonuses shall terminate, at which time the Company shall be
responsible for compensating the Executive for any unpaid salary,
vacation time not taken and unreimbursed expenses. Subject to
this exception and the obligation of the Company to compensate the
Executive through the notice period, no other compensation shall be
payable to the Executive should this Agreement be terminated
pursuant to this Section 3.2. The one-year
noncompetition covenant in Section 4.1(c) below shall
begin to run on the date of termination under this
Section 3.2.
Section 3.3
Termination by the Company
Without Cause . If the Executive’s employment is
terminated by the Company, without cause, all compensation shall
cease, but the Company shall be obligated to compensate the
Executive with a lump sum severance payment equal to a total of six
months of salary compensation (i.e. 50% of the Base Salary then
being paid to the Executive). In the event the
Executive’s employment is terminated pursuant to this
Section 3.3, the Executive shall be entitled to participate in
the bonus payable pursuant to Section 2.2, with respect to the
year in which his employment is terminated, prorated for the year
based on the number of full months employed during such year
compared to 12. The Company agrees to use its best efforts to
provide the Executive with at least six months notice of
termination should the Company choose to not renew this
contract. In addition, the non-competition covenants in
Sections 4.1 (a) and (c) below shall be automatically
terminated on the effective date of any termination of
Executive’s employment by the Company without
cause.
Section 3.4
Termination upon Death of the
Executive . In addition to any other provision
relating to termination, this Agreement shall terminate upon the
Executive’s death. In such event, all unpaid
compensation, compensation for vacation time not taken by the
Executive and all expense reimbursements due to the Executive shall
be paid to the Executive’s estate. In the event
Executive’s employment is terminated pursuant to this
Section 3.4, the Executive’s estate shall be entitled to
a death benefit equal to one year of salary compensation, and to
participate in the bonus pursuant to Section 2.2 with respect
to the year in which his employment is terminated pro rated for the
year based on the number of full months worked during such year
compared to 12.
Section 3.5
Termination by the
Executive . This Agreement may be terminated by the
Executive upon 90 days prior written notice, in which event the
Executive shall be entitled to salary compensation only during the
notice period (i.e. three months from the date of notice at the
Base Salary rate then in effect) and no pro rated bonus shall be
paid or payable. In the event the Executive’s
employment is terminated pursuant to this Section 3.5 the
one-year noncompetition covenants in Sections 4.1 (a) and
(c) below shall begin to run 60 days after such notice of
termination.
Section 3.6
Termination upon Change of
Control . (a) If during the Term there is a Change of
Control of the Company or Colonial Holdings, Inc. or its
subsidiaries (“Colonial”) and the Executive is not
offered, by the acquiring company or person, an employment
position, or not offered an employment position satisfactory to
him, he shall be deemed Terminated Without Cause and shall be
entitled to a severance payment in an amount equal to 150% of the
Base Salary, which shall be in addition to amounts payable to the
Executive under Section 3.3 above.
For purposes of this
Section 3.6, “Change of Control” means the
occurrence of any of the following:
(1)
any person or group of related
persons for purposes of Section 13(d) of the Exchange Act
(a “Group”), other than Jeffrey P. Jacobs and his
related trusts becomes the beneficial owner of more than 33
1 / 3
% of the total voting power of the
Company’s, Colonial’s or its parent’s voting
stock, and Jeffrey P. Jacobs and his related trusts beneficially
own, in the aggregate, a lesser percentage of the total voting
power of the vo
