Exhibit 10.2
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated as of April 1, 2007 (this “Agreement”), between
American Casino & Entertainment Properties LLC (the “Company”), having an
address at 2000 Las Vegas Boulevard South, Las Vegas, Nevada 89104, and
Ms. Denise Barton (“Employee”), having an address at 3149 Sterlingshire Drive,
Las Vegas, NV 89146.
1. Employment
Upon the terms and conditions hereinafter set forth, the Company hereby agrees
to employ Employee and Employee hereby agrees to become employed by the Company.
During the Term of Employment (as hereinafter defined), Employee shall be
employed in the position of Chief Financial Officer of the Company and shall
also serve in other positions of affiliates of the Company as may be designated
(the “Designated Affiliates”) from time to time by the board of directors of the
Company (the “Board”), provided that such Designated Affiliates are engaged in
businesses relating to gaming, casino or resort operation or development
(collectively, the “Gaming Business”). Employee shall perform such duties as are
specified from time to time by the Company, the Board and the Designated
Affiliates. Employee shall serve in such capacities at the pleasure of the
Board. Employee shall report to and be under the supervision of the Company’s
Board. Employee will also meet and work with executives of American Property
Investors, Inc. (“API”) and members of the board of directors of API.
During the Term of Employment, Employee shall devote all of her professional
attention, on a full time basis, to the business and affairs of the Company and
the Designated Affiliates, shall use her best efforts to advance the best
interest of the Company and the Designated Affiliates and shall comply with all
of the policies of the Company and the Designated Affiliates, including, without
limitation, such policies with respect to legal compliance, conflicts of
interest, confidentiality and business ethics as are from time to time in
effect.
Except as specifically provided herein, during the Term of Employment, Employee
shall not, without the prior written consent of the Company, directly or
indirectly render services to, or otherwise act in a business or professional
capacity on behalf of or for the benefit of, any other Person (as hereinafter
defined) as an employee, advisor, independent contractor, agent, consultant,
representative or otherwise, whether or not compensated (the “Exclusivity
Obligation”).
2. Term
The employment period shall commence as of April 1, 2007 and shall continue
through the period (the “Term of Employment”) ending on March 31, 2009 (the
“Expiration Date”), unless earlier terminated as set forth in this Agreement.
3. Compensation
For all services to be performed by Employee under this Agreement, during the
Term of

Page 1 of 14

--------------------------------------------------------------------------------

 

Employment, Employee shall be compensated in the following manner:
(a) Base Compensation
The Company will pay Employee a salary (the “Base Salary”) at an annual rate of
$380,000. The Base Salary shall be payable in accordance with the normal payroll
practice of the Company (but no less frequently than bi-weekly).
(b) Bonus Compensation
During the Term of Employment, Employee shall be eligible to receive an annual
bonus, as determined in the sole discretion of the Board (the “Bonus
Compensation”). The Bonus Compensation, if any, shall be computed based upon the
following formula of performance targets (“Targets”):

  (i)   2007 bonus is conditioned on ACEP’s four current properties having
aggregate Net Revenues of not less than $451.0 million and aggregate EBITDA of
not less than $106.0 million, in each case for the fiscal year ended
December 31, 2007;1         2007 bonus amount will be calculated by:
(x) determining the range in column (1) of the table below (the “Table”) which
includes the percentage amounts by which both (aa) actual 2007 aggregate Net
Revenues exceed $451.0 million and (bb) actual 2007 aggregate EBITDA exceeds
$106.0 million (it being understood and agreed that, if the actual 2007
aggregate Net Revenues and actual 2007 aggregate EBITDA amounts fall within
different ranges, then the lower range shall prevail); and (y) multiplying the
corresponding percentage set forth in column (2) of the Table by the product of
(aa) $380,000 and (bb) the Factor. Of this total bonus amount, the applicable
percentage set forth in column (3) of the table will be paid in cash and the
applicable percentage set forth in column (4) will be Deferred.         By way
of example (and assuming, for purposes of illustration only, a Factor of 0.5),
if aggregate 2007 EBITDA is 103% of $106.0 million and aggregate 2007 Net
Revenue is 107% of $451.0 million, then: (x) the applicable range under column
(1) would be 100-104.99%; (y) total bonus amount would be 4125 x $380,000 x 0.5
= $78,375; and (z) of this amount, 27.5% (or $52,250) would be paid in cash and
13.75% (or $26,125) would be Deferred.

 

1   Employee and the Company acknowledge and agree that these Targets are based
upon the Net Revenues and EBITDA forecasted in the 2007 budget submitted by the
Company’s management to API.

Page 2 of 14

--------------------------------------------------------------------------------

 

                          (1) EBITDA and             Net revenue   (2) Total  
(3) Cash   (4) Deferred equals or exceeds   Bonus   Amount   Amount
100-104.99%
    41.25 %     27.5 %     13.75 %
105-109.99
    48.0 %     32.0 %     16.0 %
110-114.99
    55.5 %     37.0 %     18.5 %
115-119.99
    60.0 %     40.0 %     20.0 %
120-124.99
    64.5 %     43.0 %     21.5 %
125-129.99
    69.0 %     46.0 %     23.0 %
130-134.99
    73.5 %     49.0 %     24.5 %
135-139.99
    79.5 %     53.0 %     26.5 %
140-144.99
    85.5 %     57.0 %     28.5 %
145-149.99
    91.5 %     61.0 %     30.5 %
150%
    99.0 %     66.0 %     33.0 %

  (ii)   Targets for 2008 Net Revenues and EBITDA and amount of 2008 bonus shall
be determined by the Company in January 2008.

All calculations and determinations of any of the foregoing matters (including
the amount of Bonus Compensation, or any component thereof, including but not
limited to EBITDA or Net Revenues or the achievement of any Target) will be made
by the Company in its sole discretion and will be final and binding on Employee,
and provided further will be adjusted by the Company to exclude the impact, as
it may determine, of items of gain, loss or expenses of an extraordinary or
unusual nature or infrequent in occurrence.
The allocation of the Bonus Compensation shall be deemed earned and to become
due on (i) February 28, 2008, with respect to 2007 Targets, provided that
Employee is employed in good standing as of such date, and (ii) December 31,
2008, with respect to 2008 Targets, provided that Employee is employed in good
standing as of such date, and provided further that the Bonus Compensation with
respect to the 2008 Targets shall not be payable by the Company until
February 28, 2009.
(c) Taxes
All amounts paid by the Company to Employee under or pursuant to this Agreement,
including, without limitation, the Base Salary and any Bonus Compensation, or
any other compensation or benefits, whether in cash or in kind, shall be subject
to normal withholding and deductions imposed by any one or more local, state or
federal governments.
(d) Change of Control
     (i) In the event that the Company enters into a binding contract for a
Change of Control transaction during the Term of Employment and Employee is
employed in good

Page 3 of 14

--------------------------------------------------------------------------------

 

standing as of such date, then, if Employee has complied with the requirements
of clause (ii) below and Employee: (x) has not been terminated for Cause or
resigned prior to the Closing Date; or (y) if the Election (as defined in clause
(ii) below) has occurred, Employee has not been terminated for Cause or resigned
prior to the expiration of the Transition Period, then Employee shall be paid a
lump-sum bonus of $505,000 (the “Change of Control Payment”), subject to and in
accordance with Section 5(b) below.
     (ii) Employee acknowledges and agrees that, in the event of a Change of
Control as a result of: (x) an acquisition of the equity of the Company or its
direct or indirect parent (whether by sale of equity interests, merger or
otherwise), then this Agreement will remain the obligation of the Company (or
its successor) and Employee’s obligations hereunder will remain in full force
and effect; or (y) a transfer of assets of the Company or its subsidiaries and
in connection therewith this Agreement is assigned by the Company, then this
Agreement will become the obligation of the assignee and Employee’s obligations
hereunder will (as such) remain in full force and effect. If, prior to the
Closing Date, the Company so elects (the “Election”) by giving written notice
thereof to Employee, then Employee shall provide, on a full time basis and in a
professional manner, during the Transition Period, such services to the Company,
the acquiring Person in such Change of Control transaction (the “Acquiring
Person”) and their respective designees as are necessary in all respects to
permit a smooth, professional transition of management (which may include,
without limitation, continuing to provide the services specified in this
Agreement or such other executive services as may be specified from time to time
by the Company, the Acquiring Person or their respective designees).
     (iii) It is understood and agreed that: (aa) if Employee becomes, directly
or indirectly, an employee of the Acquiring Person, then all of Employee’s
salary, benefits and other compensation shall be paid by the Acquiring Person;
and (bb) if Employee has entered into a new employment agreement with the
Acquiring Person then the term “Cause” shall be deemed for purposes of the
foregoing provision to have the meaning given such term in such new employment
agreement.
4. Termination
This Agreement shall terminate (subject to Section 10(f) below) and the Term of
Employment shall end, on the first to occur of (each a “Termination Event”):

  (a)   The Expiration Date;     (b)   The death of Employee or the total or
partial disability that, in the judgment of the Company, renders Employee, with
or without reasonable accommodation, unable to perform her essential job
functions for the Company for a period of at least 90 consecutive business days;
    (c)   The discharge of Employee by the Company with or without Cause (as
hereinafter defined);

Page 4 of 14

--------------------------------------------------------------------------------

 

  (d)   The resignation of Employee (and without limiting the effect of such
resignation, Employee agrees to provide the Company with not less than 30 days
prior written notice of her resignation); or     (e)   Upon the later of: (x) a
Change of Control; or (y) if the Election has been delivered to Employee, then
upon the expiration of the Transition Period.

The Company may discharge Employee at any time, for any reason or no reason,
with or without Cause, in which event Employee shall be entitled only to such
payments as are set forth in Section 5 below. As used herein, “Cause” is defined
as Employee’s: (i) failure to (x) perform the duties assigned to her or
(y) comply with the instructions given to her; (ii) personal misconduct or
insubordination; (iii) impairment due to alcohol or substance abuse;
(iv) conviction of a crime or being charged with a felony; (v) violation of a
federal or state securities law or regulation; (vi) commission of an act of
moral turpitude or dishonesty relating to the performance of her duties
hereunder; (vii) failure to comply with any of the terms of this Agreement;
(viii) breach of the Exclusivity Obligation or any of her obligations set forth
in Section 6 or Section 7 below; (ix) any revocation or suspension by any state
or local authority of Employee’s required license(s) to serve in her position(s)
with the Company; or (x) any act or failure to act by Employee which causes any
gaming, or other regulatory authority having jurisdiction over the Company, the
Designated Affiliates or any of their affiliates to seek any redress or remedy
against Employee, the Company, any Designated Affiliate or any of their
affiliates. In the case of clauses (i) and (vii) above, the Company will give
Employee a written notice of the alleged “Cause” and a 10-day period to cure
prior to termination, to the extent that the Company, in its sole discretion,
determines such conduct is curable.
5. Effect of Termination
In the event of termination of Employee’s employment hereunder, all rights of
Employee under this Agreement, including all rights to compensation, shall end
and Employee shall only be entitled to be paid the amounts set forth in this
Section 5 below.

  (a)   In the event that the Term of Employment ends (i) for the reason set
forth in Section 4(a) above (i.e., Expiration Date), or (ii) for any of the
reasons set forth in Section 4(b) above (i.e. death or disability), or (iii) for
the reason set forth in Section 4(d) above (i.e. resignation), or (iv) due to
the discharge of Employee by the Company for Cause, then, in lieu of any other
payments of any kind (including, without limitation, any Severance Payment or
Change of Control Payment), Employee shall be entitled to receive, within
fifteen (15) days following the date on which the Termination Event in question
occurred (the “Clause (a) Termination Date”) any amounts of: (A) Base Salary due
and unpaid to Employee from the Company as of the Clause (a) Termination Date;
and (B) Bonus Compensation earned, vested, due and unpaid to Employee from the
Company as of the Clause (a) Termination Date (as determined below, and not on a
pro rata basis);

Page 5 of 14

--------------------------------------------------------------------------------

 

  (b)   In the event that the Term of Employment ends for the reason set forth
in Section 4(e) above (i.e., Change of Control), then, in lieu of any other
payments of any kind (including, without limitation, any Severance Payment),
Employee shall be entitled to receive: (A) within fifteen (15) days following
the date on which the Termination Event in question occurred (the “Clause
(b) Termination Date”), any amounts of (1) Base Salary due and unpaid to
Employee from the Company as of the Clause (b) Termination Date and (2) Bonus
Compensation earned, vested, due and unpaid to Employee from the Company as of
the Clause (b) Termination Date (as determined below, and not on a pro rata
basis); and (B) sixty (60) days following the Closing Date (if Employee has
complied with the requirements of clause (ii) of Section 3(d) above), the Change
of Control Payment, payment of which shall be conditioned upon Employee’s
execution of an Employee Severance and Release Agreement in a form similar to
that shown in Exhibit A of this Agreement; provided that the Change of Control
Payment shall not be payable to Employee if either of the following events has
occurred: (1) if the Company has delivered the Election to Employee, but
Employee has been terminated for Cause or resigns prior to the expiration of the
Transition Period; or (2) if Employee has been terminated for Cause or resigns
prior to the Closing Date.     (c)   In the event that the Term of Employment
ends due to the discharge of Employee by the Company without Cause (which the
Company is free to do at any time in its sole and absolute discretion) then, in
lieu of any other payments of any kind (including, without limitation, any
Change of Control Payment), Employee shall be entitled to receive, within
fifteen (15) days following the date on which the Termination Event in question
occurred (the “Clause (c) Termination Date”): (A) any amounts of Base Salary due
and unpaid to Employee from the Company as of the Clause (c) Termination Date;
(B) any amounts of Bonus Compensation earned, vested, due and unpaid to Employee
from the Company as of the Clause (c) Termination Date (as determined below, and
not on a pro rata basis); and (C) a lump-sum payment in the amount equal to one
year’s then current Base Salary (the “Severance Payment”), payment of which
shall be conditioned upon Employee’s execution of an Employee Severance and
Release Agreement in a form similar to that shown in Exhibit A of this
Agreement. Notwithstanding the foregoing, if all of the following occur, then
Employee shall be entitled to receive, within fifteen (15) days following the
Closing Date, an additional payment equal to the difference between $505,000 and
the Severance Payment that was previously paid to Employee: (i) Employee is
employed in good standing with the Company through and including the date that
the Company enters into a binding contract for a Change of Control transaction
(the “Execution Date”); and (ii) Employee is terminated without Cause either
(1) after the Execution Date but prior to the Closing Date, or (2) after the
Election is made but prior to the end of the Transition Period; and
(iii) Employee has complied with clause (ii) of Section 3(d) from the beginning
of a sale or auction process that is reasonably likely to lead to a Change of
Control (the “Sale Process”) through the date of termination of Employee’s

Page 6 of 14

--------------------------------------------------------------------------------

 

      employment; and (iv) the Closing Date occurs on or prior to March 31,
2009; and (v) the party with whom the Company engages in a Change of Control
transaction is a party with respect to which the Employee was actively involved
in the negotiation of the Sale Process prior to the date of termination of
Employee’s employment; provided further that the Employee shall execute and
deliver a “bring down” release as a condition for the receipt of such payment.

For the purpose of this Paragraph 5, any Bonus Compensation shall be deemed
earned, vested and to become due (a) with respect to the 2007 Targets, on
February 28, 2008, provided that Employee is employed in good standing by the
Company as of such date, and (b) with respect to the 2008 Targets, on
December 31, 2008, provided Employee is employed in good standing by the Company
as of such date, and provided further that the Bonus Compensation with respect
to the 2008 Targets shall not be payable by the Company to Employee until
February 28, 2009.
Employee acknowledges and agrees that, notwithstanding any provisions to the
contrary contained in this Agreement, in the event that Employee becomes
entitled to: (x) a Change of Control Payment, then Employee shall not be
entitled to any payments under Section 5(a) or 5(c); or (y) a Severance Payment
or other payment pursuant to Section 5(a) or 5(c), then Employee shall not be
entitled to any Change of Control Payment.
6. Non-Disclosure
During the Term of Employment and at all times thereafter, Employee shall hold
in a fiduciary capacity for the benefit of the Company, each Designated
Affiliate and each of their affiliates, respectively, all secret or confidential
information, knowledge or data, including, without limitation, trade secrets,.
identity of investments, identity of contemplated investments, business
opportunities, valuation models and methodologies, relating to the business of
the Company, the Designated Affiliates or their affiliates, and their respective
business as, (i) obtained by Employee at any time during Employee’s employment
by the Company and (ii) not otherwise in the public domain (“Confidential
Information”). Employee also agrees to keep confidential and not disclose to any
unauthorized Person any personal information regarding any controlling Person of
the Company, the Designated Affiliates or any of their affiliates and any member
of the immediate family of any such Person (and all such personal information
shall be deemed “Confidential Information” for the purposes of this Agreement).
Employee shall not, without the prior written consent of the Company: (i) except
to the extent compelled pursuant to the order of a court or other body having
jurisdiction over such matter or based upon the advice of counsel that such
disclosure is legally required, communicate or divulge any Confidential
Information to anyone other than the Company and those designated by the
Company; or (ii) use any Confidential Information for any purpose other than the
performance of her duties as an employee of the Company. Employee will assist
the Company, at the Company’s expense, in obtaining a protective order, other
appropriate remedy or other reliable assurance that confidential treatment will
be accorded any Confidential Information disclosed pursuant to the terms of this
Agreement.

Page 7 of 14

--------------------------------------------------------------------------------

 

In no event shall Employee during or after her employment hereunder, disparage
the Company, the Designated Affiliates, any controlling Person of the Company,
the Designated Affiliates, their respective affiliates and family members or any
of their respective officers, directors or employees.
All processes, technologies, intellectual property and inventions (collectively,
“Inventions”) conceived, developed, invented, made or found by Employee, alone
or with others, during the Term of Employment, whether or not patentable and
whether or not on the Company’s time or with the use of the Company’s facilities
or materials, shall be the property of the Company and shall be promptly and
fully disclosed by Employee to the Company. Employee shall perform all necessary
acts (including, without limitation, executing and delivering any confirmatory
assignments, documents, or instruments requested by the Company) to vest title
to any such Inventions in the Company and to enable to the Company, at its
expense, to secure and maintain domestic and/or foreign patents or any other
rights for such Inventions.
7. Non-Compete
(a) During the Term of Employment and, unless Employee’s employment is
terminated
     (x) by the Company without Cause, in which case this Section 7(a) shall
terminate automatically and without notice, or
     (y) by the Company in connection with a Change of Control, in which case
this Section 7(a) shall terminate automatically and without notice 60 days
following the Closing Date, or .
     (z) for the reason set forth in Section 4(a) above (i.e., Expiration Date),
in which case this Section 7(a) shall terminate automatically and without
notice,
for a period of one (1) year following the last day of Employee’s employment by
the Company, Employee will not, either directly or indirectly, as principal,
agent, owner, employee, partner, investor, shareholder (other than solely as a
holder of not more than 1% of the issued and outstanding shares of any public
corporation), consultant, advisor or otherwise howsoever own, operate, carry on
or engage in the operation of or have any financial interest in or provide,
directly or indirectly, financial assistance to or lend money to or guarantee
the debts or obligations of any Person carrying on or engaged in the hotel or
casino business in or within one hundred (100) miles of the Stratosphere Hotel
and Casino.
For the avoidance of doubt, nothing in this Agreement will prohibit Employee
from investing in the securities of private companies in which she does not
participate in the management (either as an employee, officer or director),
provided that such investment has been cleared in accordance with all investment
or insider trading policies applicable to Employee.
(b) Employee covenants and agrees with the Company and its subsidiaries that,
during Employee’s employment by the Company and for one (1) year following the
last day of

Page 8 of 14

--------------------------------------------------------------------------------

 

Employee’s employment by the Company, Employee shall not directly, or
indirectly, for herself or for any other Person:

  (i)   solicit, interfere with or endeavor to entice away from the Company, any
Designated Affiliate or any of their subsidiaries or affiliates, any customer,
client or any Person in the habit of dealing with any of the foregoing;     (ii)
  interfere with, entice away or otherwise attempt to obtain the withdrawal of
any employee of the Company, any Designated Affiliate or any of their
subsidiaries or affiliates; or     (iii)   advise any Person not to do business
with the Company, any Designated Affiliate or any of their subsidiaries or
affiliates.

Employee represents to and agrees with the Company that the enforcement of the
restrictions contained in Section 6 and Section 7 (the Non-Disclosure and
Non-Compete sections respectively) would not be unduly burdensome to Employee
and that such restrictions are reasonably necessary to protect the legitimate
interests of the Company. Employee agrees that the remedy of damages for any
breach by Employee of the provisions of either of these sections may be
inadequate and that the Company shall be entitled to injunctive relief, without
posting any bond. In the event the terms of this Section 7 shall be determined
by any court of competent jurisdiction to be unenforceable by reason of its
extending for too great a period of time or over too great a geographical area
or by reason of its being too extensive in any other respect, it will be
interpreted to extend only over the maximum period of time for which it may be
enforceable, over the maximum geographical area as to which it may be
enforceable, or to the maximum extent in all other respects as to which it may
be enforceable, all as determined by such court in such action. This section
constitutes an independent and separable covenant that shall be enforceable
notwithstanding any right or remedy that the Company may have under any other
provision of this Agreement or otherwise.
8. Benefits
During the Term of Employment, Employee shall be entitled to receive certain
healthcare and other similar employee welfare benefits (including eligibility to
participate in the Executive Medical Reimbursement Plan provided by the Company)
comparable to those received by other employees of the Company at a similar pay
level and/or position with the Company as such may be provided by the Company in
its sole and absolute discretion from time to time..
In the event that, during the Term of Employment, the Company awards to its
executives stock options or restricted stock in anticipation of a public
offering, Employee shall be eligible to receive an award of such options or
restricted stock; provided, however, that the decision to make any such award to
Employee and the amount of any such award shall be subject to the review and
approval of the Board, in its sole and absolute discretion. This provision will
not be applicable in the event of a Change of Control and will not be binding on
the Company or any Acquiring Person following the occurrence of a Change of
Control.

Page 9 of 14

--------------------------------------------------------------------------------

 

9. Definitions
For purposes of this Agreement only, the following definitions shall apply:
“Beneficial Owner” has the meaning assigned to such term in Rule 13d-3 and
Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular “person” (as that term is used in Section 13(d)(3)
of the Exchange Act), such “person” will be deemed to have beneficial ownership
of all securities that such “person” has the right to acquire by conversion or
exercise of other securities, whether such right is currently exercisable or is
exercisable only after the passage of time. The terms “Beneficially Owns” and
“Beneficially Owned” have a corresponding meaning.
“Change of Control” means: (i) the consummation of any transaction (including,
without limitation, any merger or consolidation), the result of which is that
any Person, other than Carl Icahn or the Related Parties, becomes the Beneficial
Owner, directly or indirectly, of more than 50% of the Voting Stock of the
Company, measured by voting power rather than number of shares; or (ii) the
sale, transfer or other disposition of all or substantially all of the assets of
the Company.
“Closing Date” means the later of the following dates: (i) the closing of the
Change of Control transaction; or (ii) the transfer of funds from the Change of
Control transaction to Carl Icahn or the Related Parties.
“Deferred” means deferred and payable in accordance with the provisions of
Section VI of the Incentive Plan.
“EBITDA” means, with respect to the Company, net income plus (i) net interest
expense (which includes interest expense and interest income), (ii) provision
for income tax (or less income tax benefit), and (iii) depreciation and
amortization, calculated in a manner consistent with the preparation of the
Company’s most recent financial statements.
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and any
successor thereto.
“Factor” means Employee’s Individual Performance Factor, as calculated in
accordance with Section IV of the Incentive Plan.
“Incentive Plan “ means the American Casino & Entertainment Properties LLC and
Atlantic Coast Entertainment Holdings, Inc. Management Incentive Plan, effective
January 1, 2005 and revised as of January 10, 2006, as the same may be amended
from time to time.
“Net Revenues” means, with respect to any relevant period, gross revenues of the
Company for such period, as reported on the consolidated statements of income of
the Company (the “Financial Statements”) for such period, less promotional
allowances for such period, as

Page 10 of 14

--------------------------------------------------------------------------------

 

reported on the Financial Statements for such period.
“Person” means any individual, entity or group within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act, other than employee benefit
plans sponsored or maintained by the Company or by entities controlled by the
Company.
“Related Parties” means: (1) Carl Icahn, any spouse and any child, stepchild,
sibling or descendant of Carl Icahn; (2) any estate of Carl Icahn or of any
person identified in clause (1); (3) any person who receives a beneficial
interest in any estate identified in clause (2) to the extent of such interest;
(4) any executor, personal administrator or trustee who holds such beneficial
interest in the Company for the benefit of, or as fiduciary for, any person
identified in clauses (1), (2) or (3) to the extent of such interest; (5) any
corporation, partnership, limited liability company, trust, or similar entity,
directly or indirectly owned or controlled by Carl Icahn or any other person or
persons identified in clauses (1), (2), (3) or (4); and (6) any not-for-profit
entity not subject to taxation pursuant to Section 501(c)(3) of the Internal
Revenue Code or any successor provision to which Carl Icahn or any person
identified in clauses (1), (2), (3) or (4) above contributes her beneficial
interest in the Company or to which such beneficial interest passes pursuant to
such person’s will.
“Transition Period” means 60 days following a Change of Control.
“Voting Stock” means, with respect to any Person that is (a) a corporation, any
class or series of capital stock of such Person that is ordinarily entitled to
vote in the election of directors thereof at a meeting of stockholders called
for such purpose, without the occurrence of any additional event or contingency,
(b) a limited liability company, membership interests entitled to manage, or to
elect or appoint the Persons that will manage the operations or business of the
limited liability company, or (c) a partnership, partnership interests entitled
to elect or replace, the general partner thereof.
10. Miscellaneous

  (a)   This Agreement constitutes the entire agreement between the parties with
respect to the subject matter hereof and supersedes all previous written, and
all previous or contemporaneous oral negotiations, understandings, arrangements,
and agreements.     (b)   This Agreement and all of the provisions hereof shall
inure to the benefit of and be binding upon the legal representatives, heirs,
distributees, successors (whether by merger, operation of law or otherwise) and
assigns of the parties hereto; provided, however, that Employee may not delegate
any of Employee’s duties hereunder, and may not assign any of Employee’s rights
hereunder, without the prior written consent of the Company, which may be
withheld in its sole and absolute discretion. Without limiting the foregoing,
Employee acknowledges and agrees that the Company shall have the right (but no
obligation) to assign this Agreement, in connection with or in anticipation of a
Change of Control, any sale or transfer of

Page 11 of 14

--------------------------------------------------------------------------------

 

      assets or equity or otherwise , to any Person (including, without
limitation, to an Acquiring Person or to any Person that acquires directly or
indirectly any one or more properties of the Company). If elected by the
Company, upon any such assignment, all references herein to the Company shall be
deemed instead to be references to the assignee and/or its designee(s).     (c)
  This Agreement will be interpreted and the rights of the parties determined in
accordance with the laws of the United States applicable thereto and the
internal laws of the State of New York.     (d)   Employee covenants and
represents that she is not a party to any contract, commitment or agreement, nor
is she subject to, or bound by, any order, judgment, decree, law, statute,
ordinance, rule, regulation or other restriction of any kind or character, which
would prevent or restrict her from entering into and performing her obligations
under this Agreement.     (e)   Employee acknowledges that she has had the
assistance of legal counsel in reviewing and negotiating this Agreement.     (f)
  This Agreement shall be deemed drafted equally by both the parties. Its
language shall be construed as a whole and according to its fair meaning. Any
presumption or principle that the language is to be construed against any party
shall not apply. The headings in this Agreement are only for convenience and are
not intended to affect construction or interpretation. Any references to
paragraphs, subparagraphs, sections or subsections are to those parts of this
Agreement, unless the context clearly indicates to the contrary.     (g)   This
Agreement and all of its provisions, other than the provisions of Section 5,
Section 6, Section 7 and Section 10 hereunder (which shall survive termination),
shall terminate upon Employee ceasing to be an employee of the Company for any
reason.     (h)   In the event of the death of Employee during the Term of
Employment, Employee’s heir(s) shall be entitled to receive all payments
otherwise earned, vested, due and unpaid to Employee from the Company pursuant
to the terms and conditions of this Agreement as of the date of Employee’s
death.     (i)   Employee acknowledges and agrees that she shall be solely
responsible for the payment of all federal, state and other income taxes, excise
taxes and other taxes that may be payable from time to time by Employee with
respect to all payments or benefits earned or received by or payable to Employee
under this Agreement (whether consisting of Base Salary, Bonus Compensation,
Severance Payment, Change of Control Payment, or otherwise) and shall not be
entitled to receive any “gross-up payments” or other additional payments from
the Company or its affiliates on account of, with respect to, in mitigation of,
or as a set-off against,

Page 12 of 14

--------------------------------------------------------------------------------

 

      such taxes. Without limiting the foregoing, if it is determined that any
amount, right or benefit paid or payable (or otherwise provided or to be
provided) to Employee by the Company or any of its affiliates under this
Agreement or any other plan, program or arrangement under which Employee
participates or is a party (whether consisting of Base Salary, Bonus
Compensation, Severance Payment, Change of Control Payment, or otherwise), would
constitute an “excess parachute payment” within the meaning of Section 280G of
the Internal Revenue Code, as amended (the “Code”), subject to the excise tax
imposed by Section 4999 of the Code, as amended from time to time (the “Excise
Tax”), then Employee shall be solely responsible for the payment of the Excise
Tax and shall not be entitled to receive any “gross-up payments” or other
additional payments from the Company or its affiliates on account of, with
respect to, in mitigation of, or as a set-off against, such Excise Tax.

Page 13 of 14

--------------------------------------------------------------------------------

 

American Casino & Entertainment Properties LLC ,

         
By:
  /s/ Richard P. Brown
 
Name: Richard P. Brown    
 
  Title: President/CEO    

EMPLOYEE:

         
By:
  /s/ Denise Barton
 
Denise Barton    

[Signature page to Employment Agreement between American Casino & Entertainment
Properties LLC and Denise Barton]

Page 14 of 14