Document:

Exhibit
10.22

 

SIXTH
AMENDMENT TO

HADDRILL EMPLOYMENT AGREEMENT

 

This Sixth Amendment to the Employment Agreement
(the “Sixth Amendment”) is made and entered into as of December 30, 2008
(the “Effective Date”), by and between Bally Technologies, Inc., a
Nevada corporation (the “Company”), and Richard Haddrill (“Haddrill”).

 

WHEREAS, the Company and Haddrill are parties to
that certain Employment Agreement dated as of June 30, 2004, as amended on
December 22, 2004, June 13, 2005, June 20, 2006, February 13,
2008, and October 22, 2008 (as amended, the “Employment Agreement”)
pursuant to which Haddrill is employed as the Company’s Chief Executive
Officer; and

 

WHEREAS, the Company and Haddrill desire to amend
the Employment Agreement in accordance with and subject to the terms and
conditions of this Sixth Amendment;

 

NOW THEREFORE, on the basis of the foregoing
premises and in consideration of the mutual covenants and agreements contained
herein, the parties hereto agree as follows:

 

1.             The Company and
Haddrill agree that Section 4(c) of the Employment Agreement is
deleted in its entirety and replaced by the following:

 

“(c)         Club Initiation Fee. Payment of the initiation
fee to the golf or country club of Haddrill’s choice, in the Las Vegas, Nevada,
area, subject to approval by the Board of Directors. To the extent Haddrill
pays such fees directly and is subsequently reimbursed by the Company, any such
reimbursement shall be made by the last day of the calendar year following the
calendar year in which the fee was incurred, and the fees eligible for
reimbursement in any one calendar year shall not affect the fees eligible for
reimbursement in any other calendar year.”

 

2.             The Company and
Haddrill agree that Section 5 of the Employment Agreement is deleted in
its entirety and replaced by the following:

 

“5.           Business and other Expenses. The Company
shall reimburse Haddrill for reasonable business expenses (including
first-class commercial air travel, as appropriate) in accordance with the
Company’s business expense policy. Any reimbursement made by the Company
pursuant to this paragraph 5 shall be made by the last day of the calendar year
following the calendar year in which the expense was incurred, and the expenses
eligible for reimbursement in any one calendar year shall not affect the
expenses eligible for reimbursement in any other calendar year.”

 

3.             The Company and
Haddrill agree that Section 7 of the Employment Agreement is hereby
amended by adding the following new Section 7(g) to read as following:

 

 

“(g)         Termination of Employment. For all
purposes of (i) this Employment Agreement and (ii) any award of
Restricted Stock Units to Haddrill (whether or not referred to in this
Employment Agreement) if such award constitutes a deferral of compensation
within the scope of Treas. Reg. Section 1.409A, “termination,” “termination
of employment,” and any phrase of similar meaning shall have the meaning
assigned to such term in Treas. Reg. section 1.409A-1(h)(1).”

 

4.             The Company and
Haddrill agree that Section 8(d)(i) of the Employment Agreement is deleted
in its entirety and replaced by the following:

 

“(d)         (i) Upon a Change of Control, as hereinafter
defined, (A) the Company shall pay to Haddrill $980,000, and (B) Haddrill
shall be entitled to retain the rights granted hereunder to (1) all of the
Restricted Stock Units and Additional Restricted Stock Units granted to him
irrespective of the vesting schedules or distribution provisions set forth on
Schedules B and B-1, respectively hereof; provided that he shall not be entitled
to receive a distribution of the shares represented by the Restricted Stock
Units or the Additional Restricted Stock Units until the first date on which
the Company reasonably anticipates, or should reasonably anticipate, that if
the distribution is made on such date, the deduction of such payment will not
be barred by application of Section 162(m) of the Internal Revenue
Code (the “Code”), and (2) all of the Options and Additional Options
granted to him irrespective of the vesting schedules set forth in Schedules A
and A-1, respectively, hereof, and all such Restricted Stock Units, Additional
Restricted Stock Units, Options and Additional Options shall vest immediately.
Notwithstanding paragraphs 8(a) through (c), upon a Change of Control the
Company shall have no further obligations under this Agreement other than as
set forth in this paragraph 8(d). For purposes of this paragraph 8(d), a “Change
of Control” shall mean: (i) the date any unaffiliated person, entity or
group (as defined in Treas. Reg. 1.409A-3(i)(5)(v)(B)) (a “Third Party”)
acquires (or has acquired during the 12-month period ending on the date of the
most recent acquisition by such person or persons), directly or indirectly,
ownership of Company stock having more than 50% of the combined voting power of
the Company’s then outstanding voting securities entitled to vote generally in
the election of directors; (ii) consummation of a reorganization, merger
or consolidation of the Company; (iii) the date a Third Party acquires,
directly or indirectly, ownership of a substantial portion of the Company’s
assets equal to or more than 50% of the total gross fair market value (as
defined in Treas. Reg. 1.409A-3(i)(5)(vii)) of all of the assets of the Company
immediately before such acquisition or acquisitions; or (iv) the date a
majority of members of the Company’s Board of Directors (together with any
directors elected or nominated by a majority of such members) is replaced
during any 12-month period by directors whose appointment or election is not
endorsed by a majority of the members of the Board of Directors before the date
of the appointment or election; except that any event or transaction which
would be a “Change of Control” under clauses (ii) or (iii) of this
definition shall not be a Change of Control if persons who were the equity
holders of the Company immediately prior to such event or transaction (other
than the acquirer in the case of a reorganization, merger or consolidation),
immediately thereafter, beneficially own more than 50% of the combined voting
power of the Third Party’s or the reorganized, merged or consolidated company’s
then outstanding voting securities entitled to vote generally in the election
of directors. The foregoing definition of “Change of Control” is intended to be
consistent with the requirements for a “change in control

 

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event” that are set forth in Treas. Reg. §1.409A-3(i)(5) and shall
be interpreted in a manner consistent with that intent.

 

5.             The Company and
Haddrill agree that Section 8(e) of the Employment Agreement is deleted
in its entirety and replaced by the following:

 

“(e)         The payment to Haddrill of any amounts pursuant to
this paragraph 8 shall be conditioned upon the execution by Haddrill and the Company
of a mutual release agreement providing for the release of all claims against
the Company and Haddrill, respectively, except for claims arising under or in
connection with such mutual release agreement; provided further, that such
payments under this paragraph 8 shall be made only if such mutual release
agreement is agreed upon and executed by Haddrill and the Company no later than
sixty (60) days following the date of termination of employment or the date of
a Change of Control.”

 

6.             The Company and
Haddrill agree that Section 8 of the Employment Agreement is hereby amended
by adding the following new Section 8(f) to read as follows:

 

“(f)          Six-Month Delay for Payments to Specified Employee. If Haddrill
is a Specified Employee (as defined below) as of the date of his termination of
employment under this Agreement, notwithstanding any other provision of this
Agreement, any payment to Haddrill following a termination of employment
described in paragraph 7(b), paragraph 7(c) and paragraph 7(f) will
be accumulated (the “Accumulated Amount”) and Haddrill’s right to receive
payment or distribution of such Accumulated Amount will be delayed until the
earlier of Haddrill’s death or the first day of the seventh month following
Haddrill’s termination of employment (the “Termination Payment Date”),
whereupon the Accumulated Amount will be paid or distributed to Haddrill and
the normal payment or distribution schedule for any remaining payments or
distributions will resume. During the period during which the payment of the
Accumulated Amount is delayed pursuant to Code Section 409A, such amount
will be set aside in a “rabbi trust” (within the meaning of Internal Revenue
Service Revenue Procedure 92-64) established by the Company for purposes of
holding the funds constituting the Accumulated Amount. Such funds shall be
invested in short-term U.S. Government obligations until the Termination
Payment Date, and an amount equal to the interest earned on obligations held by
the rabbi trust shall be paid to Haddrill on the Termination Payment Date or,
if later, the date the Termination Payment is actually paid to Haddrill.

 

For purposes of this Agreement, the term “Specified
Employee” has the meaning given such term in Code Section 409A and the
final regulations thereunder (“Final 409A Regulations”), provided, however, that, as permitted in
the Final 409A Regulations, the Company’s Specified Employees and its
application of the six-month delay rule of Code Section 409A(a)(2)(B)(i) shall
be determined in accordance with rules adopted by the Board of Directors
or a committee thereof, which shall be applied consistently with respect to all
nonqualified deferred compensation arrangements of the Company, including this
Agreement.”

 

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7.             Notwithstanding
anything to the contrary in the Employment Agreement, if Haddrill ceases to be
employed with the Company on or before December 31, 2008, this Sixth
Amendment shall not affect any deferred compensation (within the meaning of
Code Section 409A) that would otherwise be payable to Haddrill in 2008.

 

[signatures on next page]

 

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IN WITNESS WHEREOF, the Company and Haddrill have
duly executed this Sixth Amendment as of the date first above written.

 

 

	
   

  	
  BALLY TECHNOLOGIES, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark Lerner

  
	
   

  	
  Name:

  	
  MARK LERNER, Secretary

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Richard Haddrill

  
	
   

  	
  RICHARD HADDRILL

  

 

5Exhibit
10.23

 

SEVENTH
AMENDMENT TO

HADDRILL EMPLOYMENT AGREEMENT

 

This Seventh  Amendment to the Employment
Agreement (the “Seventh Amendment”) is made and entered into as of August 10,
2009 (the “Effective Date”), by and between Bally Technologies, Inc.,
a Nevada corporation (the “Company”), and Richard Haddrill (“Haddrill”).

 

WHEREAS, the Company and Haddrill are parties to
that certain Employment Agreement dated as of June 30, 2004, as amended on
December 22, 2004, June 13, 2005, June 20, 2006, February 13,
2008, October 22, 2008, and December 30, 2008, (as amended, the “Employment
Agreement”) pursuant to which Haddrill is employed as the Company’s Chief
Executive Officer; and

 

WHEREAS, the Company and Haddrill desire to amend
the Employment Agreement in accordance with and subject to the terms and
conditions of this Seventh Amendment.

 

NOW THEREFORE, on the basis of the foregoing
premises and in consideration of the mutual covenants and agreements contained
herein, the parties hereto agree as follows:

 

1.             During the term
of the Employment Agreement: (i) Haddrill will continue to receive the compensation
and benefits currently provided to him on the terms and conditions set forth in
the Employment Agreement and (ii) Haddrill’s base salary will remain at $998,000
per year through December 31, 2012.

 

2.             The Company and
Haddrill agree that the following Section 4(g) is hereby added to the
Employment Agreement:

 

“(g)         Strategic Initiatives Bonus. Haddrill
shall be entitled to a lump sum cash payment of $2,500,000 (the “Strategic
Initiatives Bonus”) upon the first to occur of: (i) the achievement of
certain strategic initiatives established by the Board of Directors on or
before December 31, 2010, as determined by Board of Directors, in its sole
discretion, or (ii) a Change of Control occurring on or before December 31,
2010. If the Strategic Initiatives Bonus becomes payable pursuant to the
preceding sentence, the Strategic Initiatives Bonus shall be paid to Haddrill
within fifteen (15) days following the Board of Director’s determination that
the Strategic Initiatives Bonus has been earned; provided, however, that the
payment of the Strategic Initiatives Bonus shall be delayed until the first
business day of the first taxable year in which Haddrill is not subject to Section 162(m) of
the Code. If payment of the Strategic Initiatives Bonus is delayed pursuant to
the preceding sentence, interest shall accrue on the Strategic Initiatives
Bonus at a rate equal to the prime rate in effect on the date that the
Strategic Initiatives Bonus is earned (as determined by the Board of
Directors), as reported by Reuters, for the period beginning on the date that
the Strategic Initiatives Bonus is earned (as determined by the Board of
Directors) and ending on the date that the Strategic Initiatives Bonus is paid.”

 

3.             The Company and
Haddrill agree that the following Section 4(h) is hereby added to the
Employment Agreement:

 

“(h)         Performance Bonus. Subject to stockholder
approval of the Bally Technologies, Inc. Executive Incentive Plan (the “EIP”)
at the 2009 Annual Meeting of Stockholders, Haddrill shall be entitled to a
cash bonus under the EIP, if earned, ranging in value from $1,000,000 to

 

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$3,500,000 (the “Performance Bonus”), based upon the Company’s
achievement of cumulative diluted EPS targets established by the Board of
Directors with respect to the Company’s combined fiscal year 2010-2011 period,
and, if earned, payable at the same time bonuses are paid to executives generally
for the 2011 fiscal year, but in no event later than December 31, 2011.”

 

4.             The Company and
Haddrill agree that Section 8(d)(i)[a] of the Employment Agreement shall
is hereby amended and restated in its entirety to read as follows:

 

“[a] the Company shall pay to Haddrill $998,000 and,
if such Change of Control occurs on or before December 31, 2010, an
additional payment equal to $1,996,000, and”

 

5.             The Company and
Haddrill agree that the following Section 8(e) is hereby added to the
Employment Agreement:

 

“(e)         Notwithstanding anything to the contrary in this
Agreement, upon Haddrill’s termination for any reason other than as described
in Section 7(a), he shall continue to receive the benefits provided in Section 4(b) (other
than paid vacation and holidays), through December 31, 2012.”

 

6.             The Company and
Haddrill agree that Section 12(a) of the Employment Agreement shall
is hereby amended and restated in its entirety to read as follows:

 

“During his employment under this Agreement and
until the date that is four (4) years following the later of December 31,
2012 or the termination of his employment under this Agreement for whatever
reason, Haddrill shall not become employed by, act as a consultant for,
contract with, obtain a beneficial ownership interest of 5% or more in or
otherwise enter into any form of business relationship with any business entity
that is engaged in the design, importation, manufacture and/or sale of
electronic gaming devices, systems or systems products or any business entity
which is engaged in any other business in which the Company or any subsidiary
of the Company is engaged at the time of termination of Haddrill’s service with
the Company or, to the knowledge of Haddrill, is planning to be engaged (“Competitors”).
Such Competitors currently include, but are not limited to, International
Game Technology, Inc., WMS Industries, Inc., Shuffle Master, Inc.,
Aristocrat Leisure, Ltd., Gtech Holdings Corp., Multimedia Games, Inc.
or Konami Gaming, Inc., or any of their present and future affiliates,
subsidiaries, divisions, parent companies and successors.”

 

7.             The Company and
Haddrill agree that Section 12(b) of the Employment Agreement shall
is hereby amended and restated in its entirety to read as follows:

 

“During his employment under this Agreement and
until the date that is one (1) year following the later of December 31,
2012 or the termination of his employment under this Agreement for whatever
reason, Haddrill shall not become employed by, act as a consultant for,
contract with, obtain a beneficial ownership interest of 5% or more in or
otherwise enter into any form of business relationship with any person, film,
company, corporation, partnership, association or other organization within the
United States that is not listed in or otherwise
covered by paragraph 12(a) but that is otherwise engaged in the
gaming business.”

 

2

 

8.             The Company and
Haddrill agree that the reference to “for a period of one (1) or (2) years”
contained in Section 14 of the Employment Agreement is hereby changed to “during
the period of time covered by the covenant not to compete contained in Section 12(a).”

 

9.             On August 10,
2009, the Company granted Haddrill a number of restricted stock units under the
Plan (the “Additional Restricted Stock Units”) having a value equal to
$1.5 million dollars, as calculated in accordance with Schedule A-6 hereto. The
Additional Restricted Stock Units shall vest and be subject to the terms and
conditions set forth in the Plan and on Schedule A-6 hereto.

 

10.           Except as
expressly modified by this Seventh Amendment, the Employment Agreement shall
remain unchanged and shall remain in full force and effect.

 

[signatures on next page]

 

3

 

IN WITNESS WHEREOF, the
Company and Haddrill have duly executed this Seventh Amendment as of the date
first above written.

 

 

	
   

  	
  BALLY TECHNOLOGIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kevin Verner

  
	
   

  	
  Name:

  	
  Kevin Verner

  
	
   

  	
  Title:

  	
  Chairman, Compensation
  Committee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Richard Haddrill

  
	
   

  	
  Richard Haddrill

  

 

[Signature Page to Seventh
Amendment to Haddrill Employment Agreement]

 

 

Schedule A-6

 

ADDITIONAL RESTRICTED
STOCK UNITS

 

1.             The number of
shares of common stock subject to the Additional Restricted Stock Units was determined
by dividing $1.5 million dollars by the average per share closing price of the
Company’s common stock on the stock exchange in which the stock is principally
traded for the 20 business days immediately prior to the date of the grant.

 

2.             The Additional
Restricted Stock Units shall vest in full on January 1, 2011, so long as
Haddrill remains in continuous service with the Company through such date.

 

3.             If Haddrill’s
employment with the Company is terminated under paragraphs 7(b) or 7(c) of
the Employment Agreement, in addition to the other compensation and benefits
provided under the Employment Agreement, the vesting of the Additional
Restricted Stock Units will accelerate in full as of the termination date.

 

4.             In addition to
the above, notwithstanding any provision of the Employment Agreement, or the
Plan to the contrary, in the event of a Change of Control (as defined in the
Employment Agreement), the Additional Restricted Stock Units shall become
immediately and fully vested and exercisable effective as of immediately prior
to such Change of Control.

 

5.             Each vested
Additional Restricted Stock Unit represents Haddrill’s right to receive one
share of the Company’s common stock on the applicable vesting date (subject to
the terms and conditions of the Plan, including the satisfaction of any tax
withholding obligations).

 

6.             Except as
described in this Schedule A-6, upon a termination of Haddrill’s service with
the Company (or any successor) for any reason, the unvested portion of the
Additional Restricted Stock Units granted hereunder at the time of such
termination of service (after giving effect to the accelerated vesting, if any,
described in this Schedule A-6, if any) shall be forfeited effective as of the
date of termination.

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