Exhibit
10.29


 


Alliance
Gaming


Corporation


 


	
   

  	
   

  	
  ROBERT L. MIODUNSKI

  
	
  March 2, 2004

  	
   

  	
  President and

  
	
   

  	
   

  	
  Chief Executive Officer

  



 


Robert Luciano


 


RE: Employment Agreement


 


Dear Mr. Luciano:


 


Bally Gaining, Inc. (“Bally”), is
pleased to offer you employment for Sierra Design Group under the following
terms and conditions effective on March 2, 2004 (the “Effective Date”).
This offer is not intended to, and if accepted it will not, create an agreement
of employment for any specific term or otherwise alter the at-will nature of
your employment relationship with Bally. Either you or Bally may terminate your
employment at any time with or without cause.


 


Position and Title. Your current
position, title, and duties will be: Executive Vice President of Bally and
President of Sierra Design Group, reporting to the President of Bally, duties
generally including all management and supervision of Sierra Design Group’s
systems business unit and product groups and any other related duties the
president of Bally may assign to you.


 


Salary. Your annual base
salary will be $250,000 beginning on the Effective Date. Your base salary will
be reviewed annually and adjustment may be made at Bally’s option based on
merit.


 


Signing Bonus. You will receive a
one-time $50,000 signing bonus on the Effective Date.


 


Annual Bonus. You will receive a
$50,000 bonus payable on each anniversary of the Effective Date that you remain
employed by Bally.


 


Salary Continuation. If your employment
is terminated without cause after the Effective Date, you will continue to
receive your base salary on normal paydays until one year after the termination
date (the “Salary Continuation Period”), less standard withholding.
Please note that this salary continuation will not apply if Bally terminates
you for cause or if you terminate your employment for any reason at any time.


 


Management Incentive
Program. You will be entitled to participate in Bally’s Management Incentive
Program established for Sierra Design Group at the level of business unit head.
Under this incentive plan you will be eligible to receive, at the discretion of
the board of directors of


 





















 


Bally, up to 100% of your base salary at
performance of 20% above plan. The “at plan” incentive is 50% of base salary.
The “at plan” targets for EBITDA and Operating Income for the periods through June 30
2007 shall be per the attached Exhibit A, Exhibit B and
Exhibit C. Bally reserves the right to modify this plan at its sole
discretion after June 30, 2007.


 


MIP Continuation. If your employment
is terminated without cause, you will receive “MIP Continuation” as follows.
The Management Incentive Plan fiscal year performance factors shall be
determined as of the end of the month immediately preceding the date of
termination. The results shall then be annualized for the remainder of the
fiscal year. Your MIP Continuation shall be the amount you would have received
for the entire fiscal year based on the annualized results. For example and
without limitation, if your employment is terminated without cause on January 15,
2006; the MIP performance factors would be determined for the fiscal
year-to-date through December 31, 2005, the result would be annualized (in
the case of the example, multiplied by two because the performance factors were
measured for half the fiscal year), and the appropriate bonus based on the
annualized amount would be calculated pursuant to the MIP, and this amount (the
“MIP Continuation Amount”) would be paid to you at the time other
payments are disbursed for the fiscal year in question under the Management
Incentive Plan. In addition, in the event Bally extends your Non-Compete Period
as set forth below, Bally shall also pay you the MIP Continuation Amount for
the extension period at the time other payments are disbursed for the fiscal
year in question under the Management Incentive Plan.


 


The foregoing terms are contingent on you
agreeing to and complying with the following:


 


Covenant not to compete. You agree not to
compete with Bally for as long as you are employed by Bally. You agree not to
compete with Bally for one year after your employment with Bally ends, if Bally
terminates you for cause or if you quit for any reason (the “Non-Compete
Period”). Notwithstanding the foregoing agreement with respect to the
Non-Compete Period, you also agree, as part of the terms and conditions of that
certain Stock Purchase Agreement, dated November 10, 2003, by and among
Alliance, Sierra Design Group, you and your trust, and as a separate and
independent covenant, not to compete with Bally and any of its affiliates for a
period of three and one half years from the Effective Date.


 


For purposes of this offer and your subsequent
employment, the term “cause” is hereby defined to mean only the following
events as determined by Bally, upon reasonable investigation, in its judgment
and discretion, as the case may be:


 


(1)           A
material act or omission which is dishonest or fraudulent against Bally;


 


(2)           A
conviction of a felony or conviction of a gross misdemeanor involving moral
turpitude or criminal conduct against any person or property, including without
limitation, Bally;


 


(3)           A
substantial act or omission that constitutes willful misconduct in the
performance of your job responsibilities or material failure to adhere to
Company policies;


 


(4)           A
substantial act, omission or pattern of conduct in the performance of your job responsibilities,
which constitutes failure to meet satisfactory, work standards. You shall have thirty
days written notice from Bally to effect a cure of unsatisfactory work
standards and avoid termination hereunder;


 


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(5)           Any
material breach of this letter agreement. You shall have thirty days after
written notice describing the particulars of the default from Bally to you to
effect a cure and avoid termination hereunder;


 


(6)           Failure
to comply with any provision of the gaming laws of the State of Nevada or the rules and
regulations of the Nevada Gaming Control Board or the Nevada Gaming Commission or
any gaming law, ordinance, rule or regulation of any city or county having
jurisdiction, or the gaming laws, regulations and rules of any other
nation, state, county or other jurisdiction in which Bally may be doing
business at any time which will materially and negatively affect the registration
and licensing of Bally. You shall have thirty days’ written notice from Bally
to effect a cure and avoid termination hereunder.


 


If you are terminated without cause, you
agree not to compete with Bally during your Salary Continuation Period, as set
forth above. Furthermore, if you are terminated without cause, Bally may elect,
at its sole option, to extend your period of non-competition for an additional
period of time of up to one year if Bally provides you with Salary Continuation
and MIP Continuation during this additional period of non-competition. In the
event Bally so elects to exercise its option to extend the Non-Compete Period,
Bally shall give you written notice at least one-hundred eighty days before the
expiration of the initial Non-Compete Period.


 


To “compete” means to establish, engage, or
be connected with, directly or indirectly, any person or entity engaged in a
business in competition with the business Bally (which, as defined above,
includes any of Bally’s subsidiaries or affiliates) in any area where Bally
does business, whether as an employee, owner, partner, agent, employee,
officer, consultant, advisor, stockholder (except as the beneficial owner of
not more than 5 percent of the outstanding shares of a corporation, any of the
capital stock of which is listed on any national or regional securities
exchange or quoted in the daily listing of over-the-counter market securities
and, in each case, in which you do not undertake any management or operational
or advisory role) or in any other capacity, for your own account or for the
benefit of any person or entity.


 


You acknowledge and agree that the scope and
duration of this covenant not to compete are reasonable and fair. However, if a
court of competent jurisdiction determines that this covenant is overly broad
or unenforceable in any respect, you and Bally agree that the covenant shall be
enforced to the greatest extent the court deems appropriate and that the court
may modify this covenant to that extent.


 


Covenant not to solicit
customers, employees, or consultants. You agree that during your employment with
Bally and for six months after your employment ends for any reason or for the
duration of your entire Non-Compete Period, whichever is longer, you shall not,
directly or indirectly, (i) aid or endeavor to solicit or induce any other
employee or consultant of Bally to leave Bally to accept employment of any kind
with any other person or entity, or (ii) solicit the trade or patronage of
any of Bally’s customers (which includes customers of any of Bally’s
subsidiaries or affiliates) or of anyone who has traded or dealt with Bally
with respect to any technologies, services, products, trade secrets, or other
matters in which Bally is active.


 


Confidential information. You agree that
your work for Bally will give you access to confidential matters of Bally not
publicly known such as proprietary matters of a technical nature


 


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(including but not limited to know-how, technical
data, gaming processes, gaming equipment, techniques, developments) and
proprietary matters of a business nature (including but not limited to
information about costs, profits, markets, sales, lists of customers, and
matters received by Bally in confidence from other parties), collectively
referred to as “Confidential Matters.” Some Confidential Matters may be
entitled to protection as “Trade Secrets,” as that term is defined in N.R.S.
600A.030(5), the Restatement of Torts, and case law interpreting the same. “Confidential
Matters” shall not include any matters for which you have prior knowledge of
prior to the Effective Date of this Agreement or matters that are known or come
to be known as industry standard practice.


 


You agree to keep secret all such
Confidential Matters and agree not to directly or indirectly, other than is
necessary in the business of Bally and the scope of your employment, disclose
or use any such Confidential Matters at any time except with prior written
consent of Bally. You agree that all written materials (including
correspondence, memoranda, manuals, notes, and notebooks) and all models,
mechanisms, devices, drawings, and plans in your possession from time to time
(whether or not written or prepared by you) embodying Confidential Matters
shall be and remain the sole property of Bally, and you will use all reasonable
precautions to assure that all such written materials and models, mechanisms,
devices, drawings, and plans are properly protected and kept from unauthorized
persons. You further agree to deliver all Confidential Matters, including
copies, immediately to Bally on termination of your employment for any reason,
or at any time Bally may request.


 


Unless required by court proceeding, for a
period of ten years after termination of your employment with Bally for any
reason, you shall not reveal directly or indirectly to any person or entity or
use for your personal benefit (including without limitation, for the purpose of
soliciting business, whether or not competitive with any business of Bally) any
Confidential Matters. To the extent that any Confidential Matters are
considered by Bally as Trade Secrets, you agree that all limitations on use of
these Trade Secrets shall last forever. You further agree that immediately upon
or after termination, you will deliver to Bally all memoranda, notes, reports,
lists, models, mechanisms, devices, drawings or plans and other documents (and
all copies thereof) in your possession relating to the business of Bally or its
subsidiaries and affiliates.


 


Intellectual Property. You shall promptly
disclose in writing to Bally all inventions, discoveries, concepts, ideas,
developments, improvements, and innovations, whether or not patentable, and the
expressions of all inventions, discoveries, concepts, ideas, developments, improvements,
and innovations, whether or not copyrightable (collectively “Inventions”),
conceived, developed, or first actually reduced to practice by you, either
alone or with others, during your employment with Bally or during the first six
months after your employment with Bally ends for any reason, that (i) relate
in any manner to the existing or contemplated business or research activities
of Bally, (ii) are suggested by or result from your work for Bally; or (iii) result
from the use of time, materials, or facilities of Bally. All Inventions you
conceive, develop, or first actually reduce to practice, either alone or with
others, while employed by Bally that relate in any manner to the existing or
contemplated business or research activities of Bally shall be the exclusive
property of Bally. You assign to Bally your entire right, title, and interest
in and to all such Inventions and to all unpatented Inventions that you now
own, except those specifically described in a statement that has been separately
executed by you and an officer of Bally and attached hereto, provided, however,
that if no such list is attached, you represent and


 


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warrant that there are no such Inventions. You
will, at the request and expense of Bally, execute specific assignments to any
such Inventions and execute, acknowledge, and deliver patent applications and
such other documents (including but not limited to all provisionals,
continuations, continuations-in-part, continued prosecution applications,
extensions, re-issues, re-examinations, divisionals and foreign counterparts)
and take such further action as may be considered necessary by Bally at any
time, whether during your employment with Bally or after it terminates for any
reason, to obtain and define letters patent in any and all countries and to
vest title to such Inventions and related patents or patent applications in
Bally or its assignees. Any Invention that you disclose to a third person or
describe in a patent application filed by you or in your behalf during your
employment with Bally or within six months after your employment with Bally
terminates for any reason shall be presumed to have been conceived or made by
you during your employment with Bally unless proved to have been conceived and
made by you after the expiration or termination of this letter agreement.


 


Non-disparagement. You and Bally each
agree that, during your employment with Bally and after your employment with
Bally terminates for any reason, neither shall, publicly or privately,
disparage or make any statements (written or oral) that could impugn the
integrity, acumen (business or otherwise), ethics, or business practices of the
other (including, in the case of Bally, its affiliates and subsidiaries), except,
in each case, to the extent (but solely to the extent) necessary (i) in
any judicial or arbitration action to enforce the provisions of this letter
agreement, or (ii) in connection with any judicial or administrative
proceeding to the extent required by applicable law, or (iii) as otherwise
required by law.


 


Injunctive relief;
jurisdiction. You acknowledge that Bally will suffer irreparable
injury; not readily susceptible of valuation in monetary damages, if you breach
any of your obligations under the non-compete, non-solicitation,
non-disclosure, confidentiality, intellectual property or non-disparagement
sections of this Agreement. Accordingly, you agree that Bally will be entitled,
at its option, to injunctive relief against any breach by you of your
obligations under these sections in any federal or state court of competent
jurisdiction sitting in Nevada, in addition to monetary damages and any other
remedies available at law or in equity. You hereby submit to the jurisdiction
of such courts for the purposes of any actions or proceedings instituted by
Bally to obtain such injunctive relief, and agree that process may be served on
you under the relevant rules of civil procedure, addressed to your last
address known to Bally, or in any other manner authorized by law.


 


Material inducements. The restrictive
covenants and other provisions in this letter agreement are material
inducements to Bally entering into and performing its obligations under this
letter agreement. Accordingly, in the event of any breach of these provisions
by you, in addition to all other remedies at law or in equity possessed by
Bally, including but not limited to the right to enforce the covenants you have
agreed to in this letter agreement, Bally shall have the right to terminate this
letter agreement and your employment with Bally and not pay any amounts payable
to you under this letter agreement.


 


Except as expressly modified by this letter,
the terns and conditions of your employment with Bally shall remain in full
force and effect and shall be subject to Bally’s regular employment policies
and practices as may be in effect from time to time. This letter comprises the
entire agreement between you and Bally and supersedes all other oral and
written agreements


 


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previously entered into by you and Bally
concerning the same subject matter. To repeat, this offer is not intended to,
and if accepted it will not, create an agreement of employment for any specific
term or otherwise alter the at-will nature of your employment relationship with
Bally. If you accept this offer, either you or Bally may terminate your
employment at any time with or without cause.


 


If you accept this offer, please sign below
and return this letter to me. A copy will be sent for your records. Once signed
and returned, this letter will comprise a binding agreement between you and
Bally. This agreement may be executed by facsimile copy and in multiple
counterparts, each of which shall be deemed an original, but all of which when
taken together shall constitute one and the same instrument. If you have any
questions about its meaning, you are urged to consult with your attorney.


 


 


Sincerely,


 


 


	
  ALLIANCE GAMING CORPORATION

  
	
   

  
	
  /s/ Robert L. Miodunski

  	
   

  
	
  By: Robert L. Miodunski, President

  



 


 


ACCEPTANCE


 


I have read the foregoing letter, and I have
reviewed it with counsel or have had the opportunity to do so. I understand and
accept its terms.


 


 


	
  /s/ Robert Luciano

  	
   

  	
  March 2, 2004

  	
   

  
	
  Robert Luciano

  	
  Date signed

  



 


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