certifications set forth in this Section.
26.
Section 409A Compliance
(A)
THE PARTIES AGREE THAT THIS AGREEMENT IS
INTENDED TO COMPLY WITH THE REQUIREMENTS OF SECTION 409A OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED, AND THE REGULATIONS AND GUIDANCE PROMULGATED
THEREUNDER ("SECTION 409A") OR AN EXEMPTION FROM SECTION 409A.
THE COMPANY
SHALL UNDERTAKE TO ADMINISTER, INTERPRET, AND CONSTRUE THIS AGREEMENT IN A
MANNER THAT DOES NOT RESULT IN THE IMPOSITION ON THE EXECUTIVE OF ANY ADDITIONAL
TAX, PENALTY, OR INTEREST UNDER SECTION 409A.
EACH PAYMENT UNDER THIS AGREEMENT
SHALL BE TREATED AS A SEPARATE PAYMENT FOR PURPOSES OF SECTION 409A.
(B)
A TERMINATION OF EMPLOYMENT SHALL NOT BE
DEEMED TO HAVE OCCURRED FOR PURPOSES OF ANY PROVISION OF THIS AGREEMENT
PROVIDING FOR THE PAYMENT OF ANY AMOUNTS OR BENEFITS UPON OR FOLLOWING A
TERMINATION OF EMPLOYMENT UNLESS SUCH TERMINATION IS ALSO A "SEPARATION FROM
SERVICE" WITHIN THE MEANING OF SECTION 409A AND, FOR PURPOSES OF ANY SUCH
PROVISION OF THIS AGREEMENT, REFERENCES TO A "TERMINATION," "TERMINATION OF
EMPLOYMENT" OR LIKE TERMS SHALL MEAN "SEPARATION FROM SERVICE."
IF THE
EXECUTIVE IS DEEMED ON THE DATE OF TERMINATION TO BE A "SPECIFIED EMPLOYEE"
WITHIN THE MEANING OF THAT TERM UNDER SECTION 409A(A)(2)(B) OF THE CODE, THEN
WITH REGARD TO ANY PAYMENT OR THE PROVISION OF ANY BENEFIT THAT IS OTHERWISE
CONSIDERED DEFERRED COMPENSATION UNDER SECTION 409A PAYABLE ON ACCOUNT OF A
"SEPARATION FROM SERVICE," AND THAT IS NOT EXEMPT FROM SECTION 409A AS
INVOLUNTARY SEPARATION PAY OR A SHORT-TERM DEFERRAL (OR OTHERWISE), SUCH PAYMENT
OR BENEFIT SHALL BE MADE OR PROVIDED AT THE DATE WHICH IS THE EARLIER OF (I) THE
EXPIRATION OF THE SIX (6)-MONTH PERIOD MEASURED FROM THE DATE OF SUCH
"SEPARATION FROM SERVICE" OF THE EXECUTIVE OR (II) THE DATE OF THE EXECUTIVE'S
DEATH (THE "DELAY PERIOD").
UPON THE EXPIRATION OF THE DELAY PERIOD, ALL
PAYMENTS AND BENEFITS DELAYED PURSUANT TO THIS SUBSECTION 26(B) (WHETHER THEY
WOULD HAVE OTHERWISE BEEN PAYABLE IN A SINGLE SUM OR IN INSTALLMENTS IN THE
ABSENCE OF SUCH DELAY) SHALL BE PAID OR REIMBURSED TO THE EXECUTIVE IN A LUMP
SUM WITHOUT INTEREST, AND ANY REMAINING PAYMENTS AND BENEFITS DUE UNDER THIS
AGREEMENT SHALL BE PAID OR PROVIDED IN ACCORDANCE WITH THE NORMAL PAYMENT DATES
SPECIFIED FOR THEM HEREIN
(C)
WITH REGARD TO ANY PROVISION HEREIN THAT
PROVIDES FOR REIMBURSEMENT OF COSTS AND EXPENSES OR IN-KIND BENEFITS, EXCEPT AS
PERMITTED BY SECTION 409A, ALL SUCH PAYMENTS SHALL BE MADE ON OR BEFORE THE LAST
DAY OF CALENDAR YEAR FOLLOWING THE CALENDAR YEAR IN WHICH THE EXPENSE OCCURRED.
27.
Miscellaneous
The Company acknowledges that the Executive is in discussions with the holders
of the Senior Credit Facility Claims (as defined in the Plan) regarding the
Executive's employment by Reorganized Herbst Gaming (as defined in the Plan)
subsequent to the Substantial Consummation Date, and consents to the entry into
an employment agreement with Reorganized Herbst Gaming by the Executive during
the Term, provided such employment agreement is not effective until after the
Substantial Consummation