Document:

EXHIBIT 10.16

                                   HEMOBIOTECH

                            TEXAS TECH - HEMOBIOTECH

                             JOINT BLOOD SUBSTITUTE

                                     PROJECT

                                   PHASE III:

                          IND PROCESS AND HEMOTECH(TM)

                                  MANUFACTURING

                          JANUARY 2006 - DECEMBER 2006

<PAGE>

<TABLE>
<S>                                        <C>
PROJECT TITLE:                             TEXAS TECH-HEMOBIOTECH JOINT BLOOD SUBSTITUTE PROJECT
                                           PHASE III: IND PROCESS AND HEMOTECH(TM) MANUFACTURING

PROJECT DIRECTOR (at HemoBioTech, Inc.):   ARTHUR P. BOLLON, PHD
                                           Chairman, President & CEO
                                           HemoBioTech, Inc.
                                           14221 Dallas Parkway Suite 1500
                                           Dallas, TX 75254
                                           Tel: 214-540-8411; Fax: 214-540-8416
                                           e-mail: arthurb@flash.net
                                           http://www.hemobiotech.com

PROJECT PRINCIPAL                          JAN SIMONI, DVM, PHD
INVESTIGATOR                               Co-Inventor of HemoTech(TM)
(at TTUHSC):                               Associate Research Professor of Surgery and Internal
                                           Medicine
                                           Texas Tech University Health Sciences Center
                                           School of Medicine
                                           3601 4th Street, Office 3A119A
                                           Lubbock, TX 79430-8312
                                           Tel: 806-743-2460 x 246; Fax: 806-743-2113
                                           e-mail: jan.simoni@ttuhsc.edu

DATES OF THE ENTIRE PROPOSED PERIOD:       January 1, 2006 - December 31, 2006

TOTAL DIRECT COST REQUESTED                The down payment of approx. $286,999 will initiate Phase III of
FOR THE PROJECT: INITIAL DOWN              the SRA Project. The exact cost of the entire Phase III will be
PAYMENT OF $286,999                        determined during the course of the Project. The budget will be
                                           adjusted  at least  semi-annually  and will  reflect the dollar
                                           amount necessary to cover the costs of the procedures needed to
                                           comply with any CRO and FDA  recommendations  regarding the IND
                                           and clinical  trial stages.  Since,  as of December  2005,  the
                                           Texas Tech SRA Team and  HemoBioTech,  Inc.  are unaware of any
                                           outcomes  of the  future  FDA  meetings,  it is  impossible  to
                                           predict  the  exact  cost of  Phase  III of the  Project.  This
                                           includes,  but  is not  limited  to,  the  total  costs  of any
                                           consumables,  equipment, services, labor compensation,  related
                                           overhead   and  any  other   relevant   expenses   needed   for
                                           satisfactory completion of the Project. However, the total cost
                                           should not exceed  the  amount  presented  in the budget of the
                                           Business Plan.

PERFORMANCE SITES:                         Department of Surgery, Division of Blood Substitutes
                                           Department of Surgery
                                           Texas Tech University Health Sciences Center
</TABLE>

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<TABLE>
<S>                                        <C>
                                           3601 4th Street, 3A119A, 3A131, 3A134, 3A135 & 3A136
                                           Lubbock, TX 79430, and
                                           Texas Tech New Deal Farm
                                           East of New Deal, TX 79405

APPLICANT ORGANIZATION:                    Texas Tech University Health Sciences Center
                                           Lubbock, TX 79430

TYPE OF ORGANIZATION:                      State

ORGANIZATIONAL COMPONENT TO                School of Medicine
RECEIVE CREDIT FOR GRANT:

OFFICIAL SIGNING FOR APPLICANT             BARBARA C. PENCE, PhD, Assoc. Dean/Assoc. VP
ORGANIZATION:                              Office of Research and Graduate School
                                           Texas Tech University Health Sciences Center
                                           3601 4th Street, Room ZB.106
                                           Lubbock, TX 79430-6206
                                           Tel:  806-743-2556; Fax: 806-743-2656
                                           Email:   Barbara.Pence@ttuhsc.edu
                                           Signature:
                                           Date:

OFFICIAL IN BUSINESS OFFICE TO BE          JUNE HOWARD, Director
NOTIFIED ABOUT THIS FUNDING:               Office of Sponsored Program, TTUHSC
                                           3601 4th Street, Office 2B107
                                           Lubbock, TX 79430-6271
                                           Tel:  806-743-2960; Fax: 806-743-2656
                                           Signature:
                                           Date:

PRINCIPAL
INVESTIGATOR                                Date:
SIGNATURE:
</TABLE>

1.       PROJECT DESCRIPTION:

The proposed project represents a continuation of the joint effort between Texas
Tech University  Health Sciences Center (TTUHSC) and  HemoBioTech,  Inc. with an
objective  to  commercialize  HemoTech(TM),   the  Texas  Tech  developed  blood
substitute product. The legal basis for such an

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activity is the Sponsored Research Agreement (SRA) and License Agreement between
Texas Tech University  Health Sciences Center (a licensor) and HemoBioTech,  Inc
(a licensee).

After successful completion of PHASE 1(2002-04) of the project that included:

      o  creation of a company structure;

      o  development of the business plan; and

      o  intellectual/scientific/technical   support   during  the   process  of
         searching for an initial venture capital;

the Texas  Tech SRA team led by Dr.  Simoni,  completed  in 2005 PHASE II of the
Project, which consisted of:

      o  completion and submission to the U.S. Patent and Trademark  Office of a
         new  patent  on  the  method  for   stimulating   erythropoiesis   with
         HemoTech(TM) (PROJECT I),

      o  transfer  of the CMC,  pre-clinical  and  clinical  research  data into
         digital pdf format (PROJECT II),

      o  analysis  and  summarization  of the  CMC,  pre-clinical  and  clinical
         research data for IND application (PROJECT III),

      o  renovation and sanitation of the Texas Tech Blood Substitute Production
         Facility (PROJECT IV), and

      o  establishment of the animal blood donor facility (PROJECT V).

Each project in Phase I and II was done at Texas Tech University using the Texas
Tech intellectual and technical resources. Phase II was paid for by HemoBioTech,
Inc. in the amount of $230,503. Texas Tech did not charge HemoBioTech,  Inc. for
Phase I of the Project. Any unused funds (approx. $41,500) from Phase II will be
automatically  transferred  to the budget of Phase III.

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<PAGE>

On November 11, 2005 the SRA Team was asked to provide further assistance to the
licensee,  HemoBioTech,  Inc. As  requested by Dr.  Arthur P. Bollon,  Chairman,
President & CEO of HemoBioTech, Inc., new services provided by Texas Tech to the
company should include:

PROJECT I: CONTINUATION OF THE NECESSARY ACTIVITIES  ASSOCIATED WITH MAINTAINING
THE ANIMAL BLOOD DONOR  FACILITY IN  COOPERATION  WITH THE  DEPARTMENT OF ANIMAL
SCIENCES AT TTU.

         This  facility,  which is housing [*] cows,  was  established  in March
         2005,  is located at [*] and  supervised  by Dr.  Simoni.  The detailed
         maintenance  budget for the period  January 1, 2006 - December 31, 2006
         is presented as ATTACHMENT 1. The maintenance  budget for the period of
         January 1, 2007 - December 31, 2007,  and beyond if necessary,  will be
         presented at the end of 2006.

PROJECT II:  PARTICIPATION  IN THE IND  PROCESS  THAT WILL  INCLUDE,  BUT NOT BE
LIMITED TO:

         1.    Scientific  and  technical  interaction  with and  support of CRO
               groups, which will represent HemoBioTech, Inc. at the FDA level.

         2.    Manufacturing  [*] HemoTech(TM) to conduct possible  pre-clinical
               experiments  if  mandated  by  the  CRO  or  FDA.  3.  Conducting
               additional IN VIVO animal pre-clinical  studies with HemoTech(TM)
               if mandated by the CRO or FDA.

         4.    Conducting   additional   IN  VITRO   preclinical   studies  with
               HemoTech(TM)  if mandated by the FDA.

         5.    Collaborating  with the [*] through a contact with [*] to conduct
               all necessary histopathological

----------
*  Blank  spaces  contained   confidential   information  that  has  been  filed
   separately with the Securities and Exchange Commission pursuant to Rule 24b-2
   under the Securities Exchange Act of 1934, as amended.

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<PAGE>

               examinations of the  pre-clinical  material  collected during the
               European IND, if recommended by the CRO group.

         6.    Conduct  more studies on the  interaction  of  HemoTech(TM)  with
               automated  analytical  clinical  tests, if recommended by the CRO
               group.

         7.    Any other activities  requested by CRO groups,  the FDA, or other
               involved parties.

         These activities, according to HemoBioTech's plan, should take place in
         the first half of 2006. The time for completion of particular tasks can
         vary  and can be  more  precisely  determined  after  learning  the FDA
         rulings.  The SRA Team will do  everything  possible to  supervise  and
         expedite these  protocols.  The successful  realization of these tasks,
         however,  will depend on the  availability  of adequate  funds. At this
         moment it is impossible to predict the exact cost of these  activities,
         because the recommendations of the FDA have to be released.

PROJECT III:  MANUFACTURING OF CLINICAL-GRADE HEMOTECH(TM)

         The animal blood donors and the  HemoTech(TM)  production  facility are
         generally ready to be used for this activity. The patented HemoTech(TM)
         manufacturing  technology,  developed at TTUHSC, will be implemented in
         this  process.  HemoTech(TM)  manufacturing  process will be similar to
         that  described in the CMC documents  and will include (see  ATTACHMENT
         2):

         o   [*]

         o   [*]

         o   [*]

----------
*  Blank  spaces  contained   confidential   information  that  has  been  filed
   separately with the Securities and Exchange Commission pursuant to Rule 24b-2
   under the Securities Exchange Act of 1934, as amended.

                                       5
<PAGE>

         o   [*]

         o   [*]

         o   [*]

         o   [*]

         o   [*]

         o   [*]

         [*].  The FDA  decisions  will  dictate  future  activities  and  their
         associated  costs. The exact cost of Project III will depend on the FDA
         recommended size and number of the HemoTech(TM)  [*]. If, for instance,
         the FDA will recommend [*] larger than [*] liters,  the SRA Team should
         be furnished  with the  necessary  funds to scale up the  manufacturing
         process.  The  budget  presented  in the  Business  Plan  contains  the
         provisions for such an  eventuality.  The scale up process will require
         purchasing of the necessary production equipment and probably expansion
         of the production  facility within the TTUHSC  building.  (see BUSINESS
         PLAN)

         The number of [*] will depend on the scope of the clinical applications
         and number of patients  selected for  HemoTech(TM) in Phase I and Phase
         IIA of the clinical trials. The FDA recommendations  will determine the
         organizational  structure of the  HemoTech(TM)  production  team. As of
         December 2005, HemoBioTech, Inc. is reimbursing only [*] hours per week
         for P.I.J. Simoni, [*] hours per week for Sr. Res. Assoc. J.F. Moeller,
         and [*] hours per week for Med. Res.  Assist.  G. Simoni.  Our 21 years
         plus experience in the  manufacturing of blood  substitutes  teaches us
         that  its  production  requires  a  24/7  commitment.   Therefore,  the
         successful completion of this task

----------
*  Blank  spaces  contained   confidential   information  that  has  been  filed
   separately with the Securities and Exchange Commission pursuant to Rule 24b-2
   under the Securities Exchange Act of 1934, as amended.

                                       6
<PAGE>

         will  depend  on the  ability  of  HemoBioTech,  Inc.  to  provide  the
         necessary  funds  to  adequately  compensate  the SRA Team  during  the
         manufacturing of clinical-grade product. Moreover, as presented in 2003
         to   HemoBioTech's    Executives   the   personnel   requirements   for
         manufacturing  of  clinical-grade   HemoTech(TM)   (ATTACHMENT  3)  can
         increase.  If  necessary,  the SRA Team should have access to funds for
         hiring of new employees to  accommodate  the  anticipated  expansion as
         presented  previously.  Therefore,  for the  above-mentioned  and other
         reasons it is impossible to predict the exact costs of Project III. The
         necessary budget should include, but not be limited to have free access
         to funds for any consumables,  new production and analytical equipment,
         services,  labor compensation,  related overhead and any other relevant
         expenses needed for satisfactory completion of Project III. However, we
         are  almost  sure that the total  cost  should  not  exceed  the amount
         presented in the budget of the Business  Plan.  Therefore,  Project III
         can only be  completed  successfully  if the  initial  down-payment  of
         $286,999 will be followed by continuous  funding  necessary to complete
         this  manufacturing  work. This task will be initiated in early [*] and
         completed as Phase IIA becomes resolved.

PROJECT IV: ADDITIONAL R&D ON HEMOTECH(TM)

         As recommended by Dr. Bollon,  legal protection for HemoTech(TM) should
         be continued. After successful completion of the patent application for
         HemoTech's(TM)  related [*]  property,  which  according  to the patent
         lawyers,   will  provide   HemoTech(TM)   with  another  [*]  years  of
         protection,  the SRA Team already initiated the process of patenting of
         other therapeutic properties of HemoTech(TM).

----------
*  Blank  spaces  contained   confidential   information  that  has  been  filed
   separately with the Securities and Exchange Commission pursuant to Rule 24b-2
   under the Securities Exchange Act of 1934, as amended.

                                       7
<PAGE>

         Project IV will  include  the  completion  of patent  applications  for
         HemoTech(TM)  induced [*] and  HemoTech(TM)  [*] property.  These tasks
         should be completed in the year [*]. The cost of these tasks should not
         exceed $[*] for research expenses excluding labor and patenting costs.

PROJECT V: Will  contain any other  unlisted  and as  yet unknown  intellectual,
         scientific,  technical,  managerial and manufacturing activities, which
         will  result  from  conducting  the  Phase HI of this  project  between
         January 1, 2006 and December 31, 2006.

TECHNICAL AND MANAGERIAL RESOURCES: Texas Tech University Health Sciences Center
         with twenty years of experience in the blood  substitute  field has all
         intellectual  and  almost  all  technical   resources  to  successfully
         complete Phase III of the Project.  If scale-up will be recommended new
         production  equipment,  facility  expansion and hiring of new personnel
         must be funded.

FUNDING REQUESTS:  The total funds requested for Phase III of the Project cannot
         be determined  at the present  time.  The down payment of $286,999 will
         only initiate Phase III of the SRA Project.

         The exact cost of the entire  Phase Ill will be  determined  during the
         course  of  the   Project.   The  budget  will  be  adjusted  at  least
         semi-annually and will reflect the dollar amount necessary to cover the
         costs of the procedures  needed to comply with any FDA  recommendations
         regarding  the IND and clinical  trial  stages.  Since,  as of December
         2005, the Texas Tech SRA Team and HemoBioTech,  Inc. are unaware of any
         outcomes

----------
*  Blank  spaces  contained   confidential   information  that  has  been  filed
   separately with the Securities and Exchange Commission pursuant to Rule 24b-2
   under the Securities Exchange Act of 1934, as amended.

                                       8
<PAGE>

         of the future FDA meetings,  it is impossible to predict the exact cost
         of Phase III of the Project. This includes,  but is not limited to, the
         total   costs   of  any   consumables,   equipment,   services,   labor
         compensation,  related overhead and any other relevant  expenses needed
         for  satisfactory  completion of the Project.  However,  the total cost
         should not exceed the amount  presented  in the budget of the  Business
         Plan.

         The budget  for Phase III of the  Project  includes  [*]%  overhead  as
         mandated by the Sponsored Research  Agreement.  This [*]% overhead will
         cover  use  of  the  TTUHSC   facilities  during  the  funding  period.
         (ATTACHMENT 4)

SUBMITTED BY:

JAN SIMONI, DVM, PHD

Associate Research Professor of Surgery and Internal Medicine
P.I. of Sponsored Research Agreement
TTUHSC, School of Medicine

Lubbock, TX 79430

SIGNATURE: /s/ Jan Simoni                                    DATE: 1/03/06

----------
*  Blank  spaces  contained   confidential   information  that  has  been  filed
   separately with the Securities and Exchange Commission pursuant to Rule 24b-2
   under the Securities Exchange Act of 1934, as amended.

                                       9
<PAGE>

APPROVED BY:

BARBARA C. PENCE, PH.D.

Associate Vice President for Research and
Associate Dean for Research and the Graduate School

Office of Research and the Graduate School, TTUHSC Lubbock, TX 79430

SIGNATURE: /s/ Barbara Pence                         DATE: 1/09/06

MS. JUNE HOWARD

Director, Office of Sponsored Programs
TTUHSC, Lubbock, TX 79430

SIGNATURE: /s/ June Howard                           DATE: 1/09/06

LANCE ANDERSON, JD

Director, Office of Technology Transfer and Intellectual Properties
TTU & TTUHSC, Lubbock, TX 79414

SIGNATURE: /s/ Lance Anderson                        DATE: 1/09/06

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<PAGE>

ATTACHMENT 1.

ANIMAL BLOOD DONOR FACILITY MAINTENANCE BUDGET:

From:             Johnson, Jay W
To:               Simoni, Jan
Cc:
Subject: budget
Sent:             12/14/2005 2:00 PM
Importance:       Normal

Dr. Simoni, Here is the proposed budget
Thanks for working with us and have a great Christmas and a Happy Holiday.
Jay W Johnson

Assistant Professor
Beef Cattle
Texas Tech University
806/742-2805 ext 253
806/742-2335
Proposed Budget.doc

                                 Proposed Budget
                              HemoBio Tech Project

                                                               AMOUNT
                                                               ------
               1.   Salary and Wages
                    Animal Technician
                    $[*] @ [*] Time                            $[*]
               2.   Fringes                                    $[*]
               3.   Feed & Care of cattle                      $[*]
               4.   Maintenance & Supplies                     $[*]
                        Subtotal Total                         $[*]
               5.   F&A @ [*]                                  $[*]
                                                               ------
                    Total Direct & Indirect Costs              $[*]

                               Budget Summary

         The exact  cost of the  budget  for the year  2006  will be  determined
through the course of the project. The budget will be adjusted  semi-annually to
cover costs of any additional  activities needed to comply with any FDA or other
government entity recommendations.

         As of December 2005, the Texas Tech  University  team is unaware of any
future FDA outcome meetings;  thus it is impossible to predict if the purchasing
of any new animals will be needed.  Future  purchases,  which will  increase the
number  of  animals  available  for use,  will be based  upon FDA  requirements.
Subsequently,  if new animals are warranted, the budget will be increased to not
only cover these purchases,  but any  compensation,  related  overhead,  and any
relevant expenses needed for satisfactory completion of the project.

----------
*  Blank  spaces  contained   confidential   information  that  has  been  filed
   separately with the Securities and Exchange Commission pursuant to Rule 24b-2
   under the Securities Exchange Act of 1934, as amended.

                                       2
<PAGE>

ATTACHMENT 4.

INITIAL DOWN PAYMENT FOR PHASE III: $286,999

PROJECT TITLE:   The Texas Tech-HemoBioTech Joint Blood Substitute Project.
                 Phase III: IND Process and HemoTech(TM) Manufacturing.
PROJECT DIRECTOR (at HemoBioTech, Inc.):  Dr. Arthur P. Bollon
PROJECT PRINCIPAL INVESTIGATOR (at TTUHSC):  Dr. Jan Simoni
DETAILED BUDGET FOR PHASE II OF THE PROJECT
FROM: January 1, 2006                                 THROUGH: December 31, 2006
SALARY:

<TABLE>
<CAPTION>
                                                                      DOLLAR AMOUNT REQUESTED
NAME                ROLE ON                     TYPE%       SALARY        SALARY         FRINGE       TOTAL
                    PROJECT           APPT      EFF         BASE          REQUESTED      (includ.4%for infl.)
                                      (mo)
<S>                 <C>                  <C>       <C>      <C>           <C>             <C>          <C>
SIMONI, Jan         P.I.                 12        [*]%     [*]           [*]             [*]          [*]
MOELLER, John F.    Sr.Res.Assoc         12        [*]%     [*]           [*]             [*]          [*]
SIMONI, Grace       Med.Res.Asst         12        [*]%     [*]           [*]             [*]          [*]
To be hired         Animal Tech.         12        [*]%     [*]           [*]             [*]          [*]
Additional Compensation During HemoTech(TM) Manufacturing and QC/QA
(Over-Time; HSC OP: [*])                                                  [*]             [*]          [*]
SALARY SUBTOTALS:                                                         [*]             [*]          [*]
CONSULTANTS:                                                              [*]             [*]          [*]
EQUIPMENT (ITEMIZE):
Phase III of this project will require:         QC Analytical Equipment (GC)                           [*]
                                                Electronic Signature Labeling System                   [*]
                                                Co-oximeter                                            [*]
                                                HemoScan                                               [*]
TOTAL:                                                                                                 [*]
SUPPLIES: (Itemize by category):
Initial payment for production of [*]:                                                                 [*]
Initial payment for production of HemoTech(TM)                                                         [*]
Cattle care and feed:                                                                                  [*]
Other Supplies for cattle care feed                                                                    [*]
[*] Supplies:                                                                                          [*]
Analytical Chemistry Interference with HemoTech(TM) Supplies:                                          [*]
Initial payment for new [*]:                                                                           [*]
TOTAL:                                                                                                 [*]
ALTERATIONS AND RENOVATIONS:                                                                           [*]
OTHER EXPENSES:
Photocopying, postage, phone, secretarial, e-mail/internet connection:                                 [*]
TRAVEL: For P.I. and co-investigators to travel to company headquarter, FDA, etc.:                     [*]
SUBTOTAL:  INITIAL DIRECT COST FOR PHASE III OF THE PROJECT:                                           [*]
TTUHSC OVERHEAD (Modified [*]% of [*] base-excluding equipment):                                       [*]
INITIAL TOTAL FOR PHASE III (FIRST DOWN PAYMENT):                                                      [*]
                                                                         MINUS $ APPROX. 41,500 FROM PHASE II
INITIAL TOTAL FOR PHASE III:                                                                          286,999
</TABLE>

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*  Blank  spaces  contained   confidential   information  that  has  been  filed
   separately with the Securities and Exchange Commission pursuant to Rule 24b-2
   under the Securities Exchange Act of 1934, as amended.

                                       3EX-10.11

 

	 	 	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 

EXHIBIT 10.11

EMPLOYMENT AGREEMENT

     EMPLOYMENT AGREEMENT dated as of January 16, 2006 (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 (the “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 act as Chief Financial Officer of such affiliates of the Company as may be
designated (the “Designated Affiliates”) from time to time by the board of directors of American
Entertainment Properties Corp., the sole member of the Company (the “Board”). 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 President of the Company or the President’s designee
and such other persons as shall be designated from time to time by the Board.

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.

During the Term of Employment, the 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 hereafter defined) as an
employee, advisor, independent contractor, agent, consultant, representative or otherwise, whether
or not compensated.

2. Term

The employment period shall commence as of January 16, 2006 and shall continue through the period
(the “Term of Employment”) ending on March 31, 2007 (the “Expiration Date”), unless earlier
terminated as set forth in this Agreement.

3. Compensation

1

 

For all services to be performed by Employee under this Agreement, during the Term of Employment,
the 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 $350,000. The Base
Salary shall be payable in accordance with the normal payroll practice of the Company (but no less
frequently than bi-weekly). The Base Salary shall be reviewed on an annual basis for increase under
the Company’s normal performance review process, which occurs in March of each year and shall
become effective during the first pay period in April. The Company is under no obligation to grant
any such increases and any such increases may be granted or withheld in the sole discretion of the
Company.

(b) Bonus Compensation

In the event that, during the Term of Employment, the Company shall develop a management incentive
plan applicable to all executive management employees of the Company, Employee shall be eligible to
participate in such plan, if any, on a basis proportionate to her compensation level and level of
activity to contribute to the Company’s success, as determined in the sole discretion of the Board
(“Bonus Compensation”).

(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.

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 45 consecutive business
days;
	 
	 	(c)	 	The discharge of Employee by the Company with or without Cause (as defined below); or
	 
	 	(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

2

 

	 	 	 	of her resignation).

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 any of
her obligations set forth in Section 6 below; (ix) any revocation or suspension by any state or
local authority of Employee’s required license(s) to be the Chief Financial Officer (or similar
position) of 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 the Employee, the Company, any Designated
Affiliate or any of their affiliates.

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), other than a resignation within six (6) months
following a Change of Control (as hereafter defined), which shall be governed by
paragraph 5(b) below, 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 payments), Employee shall be entitled to receive, within thirty (30) 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, due
and unpaid to Employee from the Company as of the Clause (a) Termination Date.
	 
	 	(b)	 	In the event that the Term of Employment ends (i) due to the discharge of the
Employee by the Company without Cause (which the Company is free to do at any time in
its sole and absolute discretion) or (ii) by the Employee for Good Reason (as
hereinafter defined) within six (6) months following a Change of Control, then, in lieu
of any other payments of any kind (including, without limitation, any severance
payments), Employee shall be entitled to receive, within thirty (30) days following the
date on which the Termination Event in question occurred (the “Clause (b) Termination
Date”):

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	 	(i)	 	any amounts of Base Salary and previously earned Bonus
Compensation due and unpaid to Employee from the Company as of the Clause (b)
Termination Date; and
	 
	 	(ii)	 	a lump-sum payment in the amount equal to one year’s Base Salary,
payment of which shall be conditioned upon execution of a settlement and
release agreement in form and substance acceptable to the Company.

For the purpose of this Paragraph 5, any Bonus Compensation shall be deemed earned and to become
due with respect to any year on the last business day of February of the year following the year
with respect to which the applicable performance targets (“Targets”) are computed, provided that
Employee is employed by the Company on such last business day of February. By way of example, any
Bonus Compensation with respect to 2005 Targets shall be deemed earned and to become due on
February 28, 2006.

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.

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.

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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 the 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 by the Company
without Cause or this Agreement is not renewed or extended following the Expiration Date, 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 any business that is competitive with or similar to the business
conducted by the Company, the Designated Affiliates or any of their subsidiaries which is located
in or within fifty (50) miles of any locations in which the Company, the Designated Affiliates or
any of their subsidiaries are doing business.

(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 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

5

 

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. 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 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.

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 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.

The Employee shall have “Good Reason” to terminate her employment following a Change of Control
only if: (i) the Company fails to provide compensation or benefits that the Company is obligated to
provide under paragraph 3 above and the failure is not remedied within 30 days after the Company
receives written notice from the Employee of such failure; or (ii) the Company assigns the Employee
duties, responsibilities or reporting relationships not contemplated by paragraph 1 above without
her consent, or limits her duties or responsibilities contemplated by paragraph 1 above in any
respect materially detrimental to her, and in either case the situation is not remedied within 30
days after the Company receives written notice from the Employee of the situation; or (iii) the
Company relocates her office to an area that is more than 50 miles in radius

6

 

from the Las Vegas Metropolitan area without
her written consent and the situation is not remedied within 30 days after the Company receives
written notice from the Employee of the situation.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and any successor thereto.

“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 his beneficial interest in the Company or to which such beneficial interest
passes pursuant to such person’s will.

“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.

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	 	(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 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.

8

 

AMERICAN CASINO & ENTERTAINMENT PROPERTIES LLC

By: American Entertainment Properties Corp., its sole member

	 	 	 	 	 
	By:
	 	/s/ Richard P. Brown
 

Richard P. Brown

President and CEO

	 	  
	 	 	 
	 	 
	EMPLOYEE:	 	 
	 	 	 
	 	 
	By:
	 	/s/ Denise Barton
 

	 	  
	 	 	Denise Barton

	 	 

[Signature page to Employment Agreement between ACEP and Denise Barton]

9

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