Exhibit 10.1
AMERISTAR CASINOS, INC.
2007 BONUS OPPORTUNITIES AND PERFORMANCE GOAL
FOR PERFORMANCE-BASED ANNUAL BONUS PLAN
Adopted by the Compensation Committee
of the Board of Directors
March 29, 2007
These 2007 Bonus Opportunities and Performance Goal (the “Program”) are being
established by the Compensation Committee (the “Compensation Committee”) of the
Board of Directors of Ameristar Casinos, Inc. (the “Company”) pursuant to the
Company’s Performance-Based Annual Bonus Plan (the “Bonus Plan”) in order to
provide a more direct alignment between the annual bonus compensation payable to
the Company’s senior management and the Company’s performance. EBITDA (as
defined below) is being used to measure Company performance because it is a
widely used measure of performance in the gaming industry and is used internally
by management to measure the Company’s operating performance.
For purposes of this Program, each Participant who is identified below is
granted a Bonus Opportunity for 2007 determined exclusively by reference to
EBITDA and such individual’s annual base salary in effect on the date of
adoption of this Program (the “Base Salary”). The actual bonus, if any, awarded
to each Participant pursuant to the Bonus Plan for 2007 (the “Earned Bonus”)
shall be determined as set forth in this Program.
For purposes of this Program, “EBITDA” means the Company’s consolidated earnings
before interest, taxes, depreciation, amortization and non-recurring items for
the year ending December 31, 2007; provided, however, that EBITDA shall be
determined: (i) by assuming that any property or other business unit of the
Company that is sold or otherwise disposed of during 2007 continued to perform
as it had been performing prior to its disposition (with such performance being
measured by extrapolating its year-over-year performance through the date of
disposition for the remainder of the year); and (ii) by excluding the
performance of any property or other business unit acquired during 2007 and any
integration or other expenses incurred by the Company during 2007 that are
directly attributable to such acquisition. For the avoidance of doubt, the Bonus
Opportunities granted pursuant to this Program have been taken into account in
establishing the Performance Goal, and amounts paid or payable pursuant to this
Program shall not be added back to EBITDA for purposes of determining whether
and to what extent the Performance Goal has been achieved. “Participants” means
each of the following individuals: (i) John M. Boushy, Chief Executive Officer
and President; (ii) Gordon R. Kanofsky, Executive Vice President; (iii) Peter C.
Walsh, Thomas M. Steinbauer, Paul Eagleton, Ray Neilsen and Alan R. Rose, each a
Senior Vice President; (iv) Thomas L. Malone, Chief Accounting Officer;

 

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and (v) Troy A. Stremming, Vice President of Governmental Affairs and Chief
Governmental Affairs Officer.
For purposes of this Program, (i) the “Performance Goal” for each Participant
shall be the achievement of EBITDA of $282,600,000 and (ii) the “Target Bonus”
for each Participant shall be the following percentage of his Base Salary:
(a) for John M. Boushy, 100%; (b) for Gordon R. Kanofsky, 85%; (c) for each of
Peter C. Walsh, Thomas M. Steinbauer, Paul Eagleton, Ray Neilsen and Alan R.
Rose, 75%; and (d) for each of Thomas L. Malone and Troy A. Stremming, 65%.
Each Participant shall be awarded an Earned Bonus for 2007 equal to (i) such
Participant’s Target Bonus, multiplied by (ii) the Applicable Bonus Percentage.
The “Applicable Bonus Percentage” means: (i) if EBITDA is less than or equal to
90.0% of the Performance Goal (i.e., $254,340,000), 0%; (ii) if EBITDA is equal
to or greater than 110.0% of the Performance Goal (i.e., $310,860,000), 200.0%;
(iii) if EBITDA is equal to or greater than 99.50% and equal to or less than
100.50% of the Performance Goal (i.e., equal to or greater than $281,187,000 and
equal to or less than $284,013,000), 100%; (iv) if EBITDA is equal to or greater
than 99% but less than 99.50% of the Performance Goal (i.e., equal to or greater
than $279,774,000 but less than $281,187,000), 99%; (v) if EBITDA is greater
than 100.50% but equal to or less than 101% of the Performance Goal (i.e.,
greater than $284,013,000 but equal to or less than $285,426,000), 101%; (vi) if
EBITDA is greater than 90% but less than 99% of the Performance Goal (i.e.,
greater than $254,340,000 but less than $279,774,000), the percentage obtained
by (A) squaring the difference between 100% and EBITDA as a percentage of the
Performance Goal, (B) subtracting the result from 100% and (C) rounding the
result of the foregoing calculation up (in the case of a decimal of 0.51 or
higher) or down (in the case of a decimal of 0.50 or lower) to the nearest
integer; and (vii) if EBITDA is greater than 101% but less than 110% of the
Performance Goal (i.e., greater than $285,426,000 but less than $310,860,000),
the percentage obtained by (A) squaring the difference between 100% and EBITDA
as a percentage of the Performance Goal, (B) adding the result to 100% and
(C) rounding the result of the foregoing calculation up (in the case of a
decimal of 0.51% or higher) or down (in the case of a decimal of 0.50 or lower)
to the nearest integer.
Solely for purposes of illustration, a Participant who is a Senior Vice
President and whose Base Salary is $400,000 would have a Target Bonus of 75% of
Base Salary, or $300,000. If actual EBITDA is $275,000,000, his Earned Bonus
would be 93% (the Applicable Bonus Percentage) of the Target Bonus, or $279,000.
The Applicable Bonus Percentage is calculated as: $275,000,000 divided by
$282,600,000 equals 97.31%, subtracted from 100% equals 2.69, squared equals
7.24, subtracted from 100% equals 92.76%, rounded up equals 93%.
In accordance with Section 5(b) of the Bonus Plan, the Compensation Committee,
in its sole and absolute discretion, may reduce (but not increase) the amount of
the Earned Bonus payable to any Participant to reflect subjective evaluations of
the Participant’s performance, the Compensation Committee’s determination that
the Performance Goal has become an inappropriate measure of achievement or for
such other reason at it may determine. In making its determination with respect
to any reduction in the amount payable to a Participant, the Compensation
Committee shall consider, but shall not be bound by, any performance evaluations
of Participants submitted by Company management.

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