Exhibit 10.1


 


EMPLOYMENT AGREEMENT


 


THIS EMPLOYMENT AGREEMENT
(the “Agreement”) is made this 1 day of May, 2009, by and between MTR Gaming Group, Inc. (“MTR” or the “Company, having an address of
State Route 2, South, Chester, West Virginia 26034, and Robert
Norton (“Executive”).


 


WHEREAS, Executive is an experienced executive in the gaming industry
and currently holds a license (in good standing) as a key employee issued by
the Missouri Gaming Commission; and


 


WHEREAS, the Company wishes to employ Executive as its Chief Operating
Officer and the parties believe it is in their mutual best interest to enter
into an agreement reflecting the terms and conditions of the Executive’s
employment relationship to the Company:


 


NOW THEREFORE, the parties, in reliance upon the mutual promises and
covenants herein contained, do hereby agree as follows:


 


1.             Term.  The Company
hereby agrees to employ Executive, and Executive agrees to serve the Company,
in the capacity indicated above for a two year period commencing on May 1,
2009 (the “Employment Date”), and ending on May 1, 2011 (such period,
subject to earlier termination as provided herein, being referred to as the “Period
of Employment”).  Ninety (90) days prior
to the end of the Period of Employment, the parties will negotiate in good
faith to extend the term of the Agreement for at least two years (including
reasonable compensation / benefits based upon Executive’s contributions to the
Company).  If the parties are unable to
reach an agreement to extend the term, then upon the expiration of the
Agreement, Executive will


 

















 


be entitled to
receive an amount equal to the
Executive’s then applicable annual Base Salary payable in monthly installments
and a monthly amount so that Executive shall be able to continue to receive the
health benefits coverage in effect on the effective date of termination.  The Company’s payment obligations with
respect to Base Salary and health benefits shall end on the earlier of (A) the
first anniversary of such termination of employment, or (B) the date on
which Executive accepts employment with or provides service to, in any
capacity, any other business or entity in exchange for compensation.  If the Executive is offered at least a two
year extension of the term (including reasonable compensation / benefits based
upon Executive’s contributions to the Company), but elects not to renew the
Agreement because he does not wish to work for the Company any longer, then the
Executive will not receive the amounts above.


 


2.             Duties and Services.  During
the Period of Employment, Executive agrees to serve the Company as its Chief
Operating Officer and in such other office of the Company, its Affiliates and
MTR to which he may be elected or appointed, and to perform such other
reasonable and appropriate duties as may be requested of him by the board of
directors of the Company (the “Board of Directors”), in accordance with the
terms herein set forth. In performance of his duties, Executive shall be
subject to the direction of the Board of Directors. Executive shall devote such
of his time, energy and skill during regular business hours to the business and
affairs of the Company and its Affiliates and to the promotion of their
interests as is required. The parties acknowledge that Executive is based in
Missouri and that Executive will be expected to relocate to the Chester, West
Virginia area.  Executive shall report
directly to the President and Chief


 


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Executive Officer of MTR.


 


3.             Compensation.


 


(a)           Base Salary. 
The base salary of the Executive for services pursuant to the terms of
this Agreement shall be $300,000.00 per
year, payable in bi-monthly installments or on such other terms as may mutually
be agreed upon by the Company and Executive. 
Executive’s base salary shall be subject to an automatic cost-of-living
increase of five percent (5%) on the first anniversary of this Agreement, and
shall be subject to periodic increase by the Company’s Compensation Committee
in its sole discretion.


 


(b)           Discretionary Cash Bonus. 
Executive shall be entitled to periodic cash bonuses in the sole
discretion of the Company’s Compensation Committee, but in no event less than 20%
(in the aggregate) of Executive’s base salary annually.


 


(c)           Benefit Plans and Fringe Benefits. 
Executive shall receive such employment fringe benefits and shall be
entitled to participate in other employee benefit plans, including without
limitation any health insurance, pension plan, profit-sharing plan, savings
plan, life insurance and disability insurance plans and the like made available
by the Company now or in the future to its executives as the Company’s
Compensation Committee may periodically award in its discretion based on the
Executive’s performance, subject to and on a basis consistent with the terms,
conditions and overall administration of such benefit plans.


 


(d)           Automobile Allowance. 
During the Period of Employment, Executive shall be entitled to $600 per
month toward the lease or purchase, insurance and maintenance of an automobile.


 


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(e)  Vacation.  Executive shall be entitled to four (4) weeks
of paid vacation annually to be taken at a time or times mutually satisfactory
to Executive and the Company.  Accrued
vacation time not utilized by Executive due to business commitments may be
carried over to the following year (provided, however, that Executive shall not
in any event utilize more than six weeks of vacation in any twelve month
period) or paid to Executive at the end of the year as additional compensation
at Executive’s election.


 


(f)            Expenses.  All
reasonable moving expenses, including moving and storage expenses (Executive to
obtain at least two bids), from Executive’s Missouri residence to the Chester,
West Virginia area, and other ordinary and customary moving expenses shall be
paid by the Company.  The Company will
reimburse Executive for temporary living expenses for Executive and his family
up to $3,000.00 per month for a period not to exceed six (6) months.  The Company shall also reimburse
Executive for his reasonable out-of-pocket costs and expenses in connection
with the performance of his duties and responsibilities hereunder.  All travel and other expenses incident to the
rendering of services by Executive hereunder, including the expenses associated
with gaming licensing in any state in which the Company or one of its
affiliates requests Executive to become licensed, shall be paid by the
Company.  The Company shall also provide
Executive a Company cellular telephone, or, at the Company’s election,
reimburse Executive for the cost of a cellular phone and monthly service
charges maintained by Executive.  If any
such expenses are paid in the first instance by Executive, the Company shall
reimburse him/her therefore on presentation of the appropriate documentation
required by the Internal Revenue Code of 1986, as amended (the “Code”), or


 


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Treasury
Regulations promulgated thereunder, or otherwise required under the Company’s
policy with respect to such expenses.


 


(g)           Working Facilities. 
The Company shall provide Executive with an office, secretarial,
administrative and other assistance, and such other facilities and services as
shall be suitable to his/her position and appropriate for the performance of
his/her duties.


 


4.             Early Termination.


 


(a)           This Agreement will terminate
automatically, and neither party shall have any further obligations or duties
under this Agreement, in the event that state regulatory authorities find
Executive unsuitable to hold the position provided herein, except for
obligations accrued under Section 3(a) and 3(f) as of the date
of termination.


 


(b)           Notwithstanding the provisions of Section 2
hereof, Executive may be discharged by the Company for Cause (as defined in Section 4(d) hereof),
in which event the Period of Employment hereunder shall cease and terminate and
neither party shall have any further obligations or duties under this
Agreement, except for obligations accrued under Section 3(a) and 3(b) as
of the date of termination.  In addition,
the Period of Employment shall cease and terminate upon the earliest to occur
of the following events:  (i) the
death of Executive or (ii) at the election of the CEO (subject to the
Americans With Disabilities Act), the inability of Executive by reason of
physical or mental disability to continue the proper performance of his/her
duties hereunder for a period of 180 consecutive days.  Upon termination of the Period of Employment
as a result of the Executive’s death or disability, in consideration for
Executive or his/her heirs and beneficiaries releasing the Company from any
claims, damages or causes of action, the Company shall pay to Executive or
his/her 


 


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estate, as the case may be, a lump sum amount equal to the greater of (i) the
base salary described in Section 3(a) hereof for the remaining term
of the Agreement, or (ii) the amount of base salary to which Executive
would have been entitled to receive for the one (1) year following his/her
death or disability.


 


(c)           In the event Executive is discharged by
the Company other than for the reasons set forth in Paragraph 4(b) above,
Executive shall have no further obligations or duties under this Agreement, provided,
however, that Executive shall continue to be bound by the provisions of Section 5
hereof if the Company performs its obligations under this Section 4(c).  In the event of termination of the Period of
Employment pursuant to the preceding sentence, unless such termination is in
connection with a change in control of the Company or a sale of all or
substantially all of the assets of MTR Gaming Group, Inc. (individually or
collectively, a “Change in Control”) (in which case Executive’s severance will be
as set forth in the last sentence of this Paragraph 4(c)), in consideration for
Executive or his/her heirs and beneficiaries releasing the Company from any
claims, damages or causes of action, the Company shall continue to pay
Executive the entire compensation otherwise payable to him/her under the
provisions of Section 3 hereof for the otherwise remaining Period of
Employment without any duty on the part of Executive to mitigate such payments;
provided, however, that if Executive should die prior to the end of such
period, the provisions of Section 4(b) hereof shall be applicable as
though Executive’s employment hereunder had not been so terminated.  In the event such termination is in
connection with a Change in Control, then the Company shall pay Executive
severance in an amount equal to the greater of (i) the entire compensation
otherwise payable to him/her under the provisions of Section 3 hereof for
the remainder of the Period of Employment hereof; or (ii) eighteen


 


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month’s salary—in
either case without any duty on the part of Executive to mitigate such
payments, in consideration for a mutual release from any further obligations of
either party hereunder.


 


(d)           For purposes of this Section 4, the
term “Cause” shall mean (i) conviction of a felony, (ii) embezzlement
or misappropriation of funds or property of the Company or any of its
affiliates (the “Affiliates”), (iii) Executive’s consistent refusal to
substantially perform, or willful misconduct in the substantial performance of,
his/her duties and obligations hereunder, which has not been cured within 30
days following written notice by the company; (iv) Executive’s engaging in
activity that the CEO of MTR determines in his reasonable judgment would result
in the suspension or revocation of any video lottery, parimutuel, or other
gaming license or permit held by MTR or any of its subsidiaries, which has not
been cured within 30 days following written notice by the company; or (v) a
determination by any state gaming regulatory agency that Executive is not
suitable to hold his/her position or otherwise to participate in a gaming
enterprise in the state in question.


 


5.             Confidentiality and Non-Competition:


 


(a)           The Company and Executive acknowledge
that the services to be performed by Executive under this Agreement are unique
and extraordinary and, as a result of such employment, Executive will be in
possession of confidential information and trade secrets (collectively, “Confidential
Material”) relating to the business practices of the Company and its
Affiliates.  Executive agrees that he/she
will not, directly or indirectly, (i) disclose to any other person or
entity either during or after his/her employment by the Company or (ii) use,
except during his/her employment by the Company in the business and for the
benefit of the Company or any of its Affiliates, any Confidential Material
acquired


 


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by Executive
during his/her employment by the Company, without the prior written consent of
the Company or otherwise than as required by law or any rule or regulation
of any federal or state authority.  Upon
termination of his/her employment with the Company for any reason, Executive
agrees to return to the Company all tangible manifestations of Confidential
Materials and all copies thereof, not to disparage the Company, and for a
period of one (1) year from the date of such termination not to solicit
for employment any employee of the Company. 
All programs, ideas, strategies approaches, practices or inventions
created, developed, obtained or conceived of by Executive during the term
hereof by reason of his/her engagement by the Company, shall be owned by and
belong exclusively to the Company, provided that they are related in any manner
to the Company’s business or that of any of its Affiliates.  Executive shall (i) promptly disclose
all such programs, ideas, strategies, approaches, practices, inventions or
business opportunities to the Company, and (ii) execute and deliver to the
Company, without additional compensation, such instruments as the Company may
require from time to time to evidence its ownership of any such items.


 


(b)           Executive agrees that during the term
hereof and for a period of one (1) year thereafter, he will not become a
stockholder, director, officer, employee or agent of or consultant to any
corporation, or member of or consultant to any partnership or other entity, or
engage in any business as a sole proprietor or act as a consultant to any such
entity, or otherwise engage, directly or indirectly, in any enterprise, in each
case which competes with any business or activity engaged in, or known by
Executive to be contemplated to be engaged in, by the Company or any of its
Affiliates within one hundred (100) miles of any location in which the Company
or any Affiliate does business or in which Executive has knowledge that the
Company or any of its Affiliates contemplates doing business; provided,


 


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however, that competition shall not include the
ownership (solely as an investor and without any other participation in or
contact with the management of the business) of less than five percent (5%) of
the outstanding shares of stock of any corporation engaged in any such
business, which shares are regularly traded on a national securities exchange
or in an over-the-counter market. The Company acknowledges
that Employee has a passive ownership interest in Centaur, Inc., Norton
Management, Inc and Norton Management, LLC (“Outside Companies”) as
described in more detail in Exhibit “B.” Employee agrees that he will keep
the Company informed as to the status of his ownership interest in the
Outside Companies. Employee further agrees to notify the Company of any conflict
in interest that may arise between him and the Company as a result of his
obligations set forth herein vis a vis his ownership interest in the Outside
Companies.  Further, Employee agrees and
warrants that during the Period of Employment (or any period during which
Employee is receiving compensation from the Company), Employee’s interest in
the Outside Companies shall remain passive.


 


(c)           Executive agrees that the remedy at
law for any breach by him of this Section 5 will be inadequate and that
the Company shall be entitled to injunctive relief.


 


6.             General. 
This Agreement is further governed by the following provisions:


 


(a)           Notices.  Any notice or other communication required or
permitted to be given hereunder shall be made in writing and shall be delivered
in person, by facsimile transmission or mailed by prepaid registered or
certified mail, return receipt requested, addressed to the parties at the
address stated above or to such other address as either party shall have
furnished in writing in accordance with this Section.  Such notices or communications shall be
effective upon delivery if delivered in person or by facsimile and


 


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either upon actual receipt or three (3) days after mailing, whichever
is earlier, if delivered by mail.


 


(b)           Parties In Interest. 
This Agreement shall be binding upon and inure to the benefit of
Executive and his/her heirs and beneficiaries, and it shall be binding upon and
inure to the benefit of the Company and any corporation succeeding to all or
substantially all of the business and assets of the Company by merger,
consolidation, purchase of assets or otherwise.


 


(c)           Arbitration. 
Any disputes arising under the terms of this Agreement shall be settled
by binding arbitration between the parties in the Weirton/Chester, West
Virginia area in a proceeding held under the rules of the American
Arbitration Association.  In such
proceeding, each party shall choose one arbitrator and the two so chosen shall
choose a third arbitrator.  The vote of
two of the arbitrators shall be sufficient to determine an award.  Arbitration proceedings shall be commenced
within thirty (30) days from the date of the claimant’s request for arbitration
to the other party.  Notwithstanding
anything herein to the contrary, the arbitrators shall have no authority to
grant either party any consequential, incidental, punitive or special damages.


 


(d)           Entire Agreement. 
This Agreement supersedes any and all other agreements, either oral or
in writing, between the parties hereto with respect to the employment of
Executive by the Company and contains all of the covenants and agreements
between the parties with respect to such employment in any manner
whatsoever.  Any modification of this
Agreement will be effective only if it is in writing signed by the parties.


 


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(e)           Governing Law. 
This Agreement shall be governed by and construed in accordance with the
laws of the State of West Virginia without giving effect to the choice of law
or conflicts of law rules and laws of such jurisdiction.


 


(f)            Severability. 
In the event that any term or condition contained in this Agreement
shall for any reason be held by a court of competent jurisdiction to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality
or unenforceability shall not affect any other term or condition of this
Agreement, but this Agreement shall be construed as if such invalid or illegal
or unenforceable term or condition had never been contained herein.


 


(g)           No Breach.            Executive
warrants and represents to the Company that neither his/her entering nor
performing this Agreement will violate the terms of any contract or covenant to
which Executive is a party or by which he is bound.  Company acknowledges that
for one year following Executive’s separation date from Isle of Capri Casinos, Inc.
(“Isle of Capri’) he is restricted from competing with Isle of Capri,
specifically said restriction applies to a 75 mile radius around any casino managed
or owned, in whole or in part, by Isle of Capri.  Company further acknowledges that Executive
may not solicit, hire or attempt to hire (for employment within a 75 mile
radius around any casino managed or owned, in whole or in part, by Isle of
Capri or any sales office, regional office or the corporate headquarters of
Isle of Capri) any Isle of Capri employee during the 6 months following his
separation from Isle of Capri absent written consent from Isle of Capri.


 


(h)           Indemnification.   The Company shall indemnify, defend and hold the
Executive harmless, to the extent permitted by law, including the payment of


 


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reasonable
attorneys’ fees, if the Company does not directly provide Executive’s defense,
from and against any and all civil claims made by anyone, including, but not
limited to, a corporate entity, company, other employee, agent, patron or
member of the general public with respect to any claims that assert as a basis,
any acts, omissions or other circumstances involving the performance of
Executive’s employment duties hereunder unless such claim is finally determined
by a court of competent jurisdiction to arise from Executive’s gross negligence
or willful, intentional and/or wanton act.


 


(i)            Code of Ethics.  Executive acknowledges receipt of and
agreement to comply with MTR Gaming Group, Inc.’s Code of Ethics and
Business Conduct and Conflicts of Interest Policy, copies of which are attached
to this Agreement as Exhibit A. 
Executive also acknowledges that MTR’s securities are publicly traded
and agrees that he will not, while in possession of material non-public
information about MTR, trade in MTR’s securities or “tip” others with respect
to such trading.


 


[signature page follows]


 


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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.


 


 


	
   

  	
  MTR Gaming Group, Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert F.
  Griffin

  
	
   

  	
  Its:

  	
  CEO

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Robert Norton 5-6-09

  
	
   

  	
  Robert Norton

  
	
   

  	
   

  
	
   

  	
  Start date will be on
  or before June 8th 2009.

  



 


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