Document:

Exhibit
10.2

 

EXECUTIVE
EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT
(this “Agreement”)
is made and entered into as of the 20th day of May, 2003, by and
between STATION
CASINOS, INC., a Nevada corporation, with its principal offices
located at 2411 West Sahara Avenue, Las Vegas, Nevada  89102 (the “Company”), and LORENZO J. FERTITTA (the “Executive”).

 

WHEREAS, the
Company and the Executive are parties to an Employment Agreement dated as of
December 17, 2001 (the Former Agreement”); and

 

WHEREAS, the Executive
has agreed to continue his employment with the Company on the terms and
conditions set forth herein; and

 

WHEREAS, the
parties to this Agreement desire to replace the Former Agreement in its
entirety with this Agreement, and the Former Agreement shall no longer be of
any force or effect;

 

NOW, THEREFORE, in
consideration of the premises and mutual covenants contained herein and for
other good and valuable consideration, the Company and the Executive (each
individually a “Party” and together the “Parties”) agree as follows.

 

1.                                       DEFINITIONS.  In addition to certain terms defined
elsewhere in this Agreement, the following terms shall have the following
respective meanings:

 

1.1              “Affiliate”
shall mean any Person controlling, controlled by or under common control with,
the Company.

 

1.2              “Base Salary”
shall mean the greater of (a) the salary provided for in Subsection 3.1
of this Agreement or (b) any increased salary granted to the Executive pursuant
to the provisions of Subsection 3.1 or Subsection 7.1(b).

 

1.3              “Board”
shall mean the Board of Directors of the Company, including any successor of
the Company in the event of a Change in Control.

 

1.4              “Cause”
shall mean that the Executive:

 

(a)                                  has
been convicted of any felony;

 

(b)                                 has
been found unsuitable to hold a gaming license by final, non-appealable
decision of the Nevada Gaming Commission; or

 

(c)                                  in
carrying out his duties under this Agreement, has engaged in acts or omissions
constituting gross negligence or willful misconduct resulting, in either case,
in material economic harm to the Company, unless such act, or 

 

 

failure to act,
was believed by the Executive in good faith to be in the best interests of the
Company or any Affiliate.

 

1.5              “Change in
Control” shall be deemed to have occurred if:

 

(a)                                  (1)  any Person, corporation, entity or group
(other than the Existing Equity Holders) is or becomes the beneficial owner,
directly or indirectly, of securities representing 50% or more of the combined
voting power of the Company’s Voting Stock (an “Acquisition Event”), or

 

(2)  the Company consolidates with or merges into
another corporation or entity, or any corporation or entity consolidates with
or merges into the Company, with the effect that the beneficial owners of the
Company’s Voting Stock held immediately prior to the consummation of such
consolidation or merger cease to beneficially own, directly or indirectly,
securities representing 50% or more of the combined voting power of the
Company’s Voting Stock (or if the Company is not the surviving entity, the
surviving company’s voting securities) upon the consummation of such
consolidation or merger (a “Merger Event”), or

 

(3)  the Company sells, conveys, transfers or
leases to any person, corporation, entity or group, directly or indirectly, in
one transaction or series of related transactions, properties and/or assets
that accounted for 75% or more of the earnings (before interest, taxes,
depreciation and amortization) of the Company, on a consolidated basis for the
four-fiscal quarter period immediately preceding the date of consummation of
such transaction (a “Sale Event”); and

 

(b)                                 within
thirty-six (36) months following an Acquisition Event, Merger Event or Sale
Event, individuals who immediately prior to such Acquisition Event, Merger
Event or Sale Event constituted the Company’s Board, together with any new or
replacement directors whose election by the Company’s Board, or whose
nomination for election by the Company’s stockholders was approved by a vote of
at least a majority of the directors then in office who were either directors
on the Company’s Board immediately prior to such Acquisition Event, Merger
Event or Sale Event (or whose election or nomination for election was
previously so approved), cease for any reason to constitute a majority of the
directors of the Company’s Board then in office.

 

Notwithstanding
the foregoing, a reincorporation, spin-off, split-off or other reorganization
transaction (a “Reorganization Event”), or series of related transactions, in
which either the “beneficial owners” of the Company’s Voting Stock or the
Existing Equity Holders beneficially own securities representing 50% or more of
the combined voting power of the Company’s Voting Stock upon the consummation
of such transaction shall not constitute an Acquisition Event, Merger Event or
Sale Event for purposes of this definition. 
For purposes of this

 

2

 

definition,
“beneficial ownership” shall have the same meaning as defined in Rules 13d-3
and 13d-5 under the Securities Exchange Act of 1934, as amended, except that a
Person shall be deemed to have “beneficial ownership” of all shares that any
such Person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time. 
For the purposes of this definition, upon consummation of an Acquisition
Event, Merger Event, Sale Event or Reorganization Event, the “Company’s Board”
and the “Company’s Shareholders” shall refer to (i) in the case of an
Acquisition Event, the Company, (ii) in the case of a Merger Event, the company
surviving the merger or consolidation, (iii) in the case of a Sale Event, the
transferee of the properties, and/or assets, and (iv) in the case of a
Reorganization Event, the entity or entities surviving such Reorganization
Event on a consolidated basis.

 

1.6              “Code”
shall mean the Internal Revenue Code of 1986, as amended.

 

1.7              “Company
Property” shall mean all items and materials provided by the Company
to the Executive, or to which the Executive has access, in the course of his
employment, including, without limitation, all files, records, documents,
drawings, specifications, memoranda, notes, reports, manuals, equipment,
computer disks, videotapes, drawings, blueprints and other documents and
similar items relating to the Company, its Affiliates or their respective
customers, whether prepared by the Executive or others, and any and all copies,
abstracts and summaries thereof.

 

1.8              “Confidential
Information” shall mean all nonpublic and/or proprietary information
respecting the business of the Company or any Affiliate, including, without
limitation, its products, programs, projects, promotions, marketing plans and
strategies, business plans or practices, business operations, employees,
research and development, intellectual property, software, databases,
trademarks, pricing information and accounting and financing data.  Confidential Information also includes
information concerning the Company’s or any Affiliate’s customers, such as
their identity, address, preferences, playing patterns and ratings or any other
information kept by the Company or any Affiliate concerning its customers
whether or not such information has been reduced to documentary form.  Confidential Information does not include
information that is, or becomes, available to the public unless such
availability occurs through an unauthorized act on the part of the Executive.

 

1.9              “Deferred
Compensation Plan for Executives” shall mean the Company’s Deferred
Compensation Plan for  Executives, effective as of November 30,
1994, as the same may be amended from time to time.

 

1.10        “Disability” shall mean a
physical or mental incapacity that prevents the Executive from performing the
essential functions of his position with the Company for a period of ninety
(90) days as determined (a) in accordance with any long-term disability plan
provided by the Company of which the Executive is a participant, or (b) by the
following procedure:  The Executive
agrees to submit to medical examinations by a licensed healthcare professional
selected by the Company, in its sole discretion, to determine whether a
Disability exists.  In addition, the
Executive may submit to the Company documentation of a Disability, or lack
thereof, from a licensed healthcare professional of his choice.  Following a determination of a Disability or
lack of Disability by the Company’s or the Executive’s licensed healthcare 

 

3

 

professional, the other Party may submit subsequent documentation relating
to the existence of a Disability from a licensed healthcare professional
selected by such other Party.  In the
event that the medical opinions of such licensed healthcare professionals
conflict, such licensed healthcare professionals shall appoint a third licensed
healthcare professional to examine the Executive, and the opinion of such third
licensed healthcare professional shall be dispositive.

 

1.11        “ERISA” shall mean the
Employee Retirement Income Security Act of 1974, as amended.

 

1.12        “Existing Equity Holders”
shall mean Frank J. Fertitta III, Blake L. Sartini, Delise F. Sartini, Lorenzo
J. Fertitta, Glenn C. Christenson and Scott M Nielson and their executors,
administrators or the legal representatives of their estates, their heirs,
distributees and beneficiaries, and any trust as to which any of the foregoing
is a settlor or co-settlor and any corporation, partnership or other entity
which is an affiliate of any of the foregoing, and any lineal descendants of
such persons (but only to the extent that the beneficial ownership of the
Voting Stock held by such lineal descendants was directly received by gift,
trust or sale from any such person).

 

1.13        “Good Reason,” as used in Subsection
7.2, shall mean and exist if there has been a Change in Control and,
thereafter, without the Executive’s prior written consent, one or more of the
following events occurs:

 

(a)                                  the
Executive is not appointed to or is otherwise removed from the office(s)
provided for in Subsection 2.3, for any reason other than the termination
of his employment;

 

(b)                                 the
Executive is assigned any duties or responsibilities that are inconsistent with
the scope of duties and responsibilities associated with the Executive’s
position as described in Subsection 2.3;

 

(c)                                  the
Company gives the Executive notice pursuant to Subsection 2.2 that it
does not intend to extend the Term of Employment for an additional five year
period;

 

(d)                                 the
Executive is not appointed to or is removed from membership on the Board;

 

(e)                                  The
Executive suffers a material reduction in the authorities, duties or
responsibilities associated with his position as described in Subsection 2.3;

 

(f)                                    the
Executive is required to relocate from, or maintain his principal office
outside of, Clark County, Nevada;

 

(g)                                 the
Executive’s Base Salary is decreased by the Company or is not increased as
provided for in Subsection 7.1(b);

 

4

 

(h)                                 the
Executive is excluded from participation in any employee benefit or short-term
incentive plan or program offered to other similarly executives of the Company
or his benefits under such plans or programs are materially reduced;

 

(i)                                     the
Company fails to pay the Executive any deferred payments that have become
payable under the Deferred Compensation Plan for Executives;

 

(j)                                     theCompany fails to reimburse the Executive for business expenses in
accordance with the Company’s policies, procedures or practices;

 

(k)                                  the
Company fails to agree to or to actually indemnify the Executive for his
actions and/or inactions, as either a director or an officer of the Company, in
accordance with Section 10, and/or the Company fails to maintain
reasonably sufficient levels of directors’ and officers’ liability insurance
coverage for the Executive when such insurance is available;

 

(l)                                     the
Company fails to make any of the payments or to provide any of the benefits
required under Subsection 7.1;

 

(m)                               the
Company fails to obtain a written agreement from any successor or assign of the
Company to assume the obligations under this Agreement upon a Change in
Control; or

 

(n)                                 the
Company purports to terminate the Executive’s employment for Cause, but such
purported termination is not effected in accordance with Subsection 6.2.

 

For purposes of this
Agreement, a determination by the Executive that the Executive has “Good
Reason” shall be final and binding on the Company and the Executive absent a
showing of bad faith on the part of the Executive.

 

1.14        “Long-Term Stay-On Performance Incentive
Agreement” shall mean that Long-Term Stay-On Performance Incentive
Agreement dated March 15, 2002, between the Company and the Executive, as the
same may be amended from time to time.

 

1.15        “Person” shall mean any
individual, firm, partnership, association, trust, company, corporation or other
entity.

 

1.16        “Pro Rata Bonus” shall mean an
amount equal to ninety percent (90%) of the Executive’s current Base Salary,
multiplied by a fraction, the numerator of which is the number of days in such
year during which the Executive was actually employed by the Company and the
denominator of which is 365.

 

1.17        “Special Long-Term Disability Plan”
shall mean the Company’s Special Long-Term Disability Plan, effective as of
November 30, 1994, as the same may be amended from time to time.

 

5

 

1.18        “Supplemental Management Retirement Plan”
shall mean the Company’s Supplemental Management Retirement Plan, effective as
of November 30, 1994, as the same may be amended from time to time.

 

1.19        “Term of Employment” shall
mean the period specified in Subsection 2.2.

 

1.20        “Voting Stock” shall mean
capital stock of any class or classes having general voting power under
ordinary circumstances, in the absence of contingencies, to elect the directors
of a corporation.

 

2.                                       TERM OF
EMPLOYMENT, POSITION AND RESPONSIBILITIES.

 

2.1              Employment Accepted.  The Company hereby employs the Executive,
and the Executive hereby accepts employment with the Company, for the Term of
Employment, in the position and with the responsibilities set forth in Subsection
2.3 and upon such other terms and conditions as are stated in this
Agreement.

 

2.2              Term of Employment.  The initial Term of Employment shall
commence upon the date of this Agreement and, unless earlier terminated
pursuant to the provisions of this Agreement, shall terminate upon the close of
business on the day immediately preceding the fifth anniversary of the date of
this Agreement; provided, however, that the initial Term of
Employment shall automatically be extended for successive five-year periods if
neither Party has advised the other in writing in accordance with Section 13
at least twelve (12) months prior to the end of the then current Term of
Employment that such Term of Employment will not be extended for an additional
five year period.  In the event that
such notice is given, the Executive’s employment shall terminate upon the close
of business on the day immediately preceding the fifth anniversary of the then
current Term of Employment.

 

2.3              Responsibilities.  During the Term of Employment, the Executive
shall be employed as President of the Company and shall have such
responsibilities as the Company may direct from time to time.  During the Term of Employment, the Executive
shall also serve as a member of the Board. 
During the Term of Employment, the Executive shall also devote his full
time and attention to the business and affairs of the Company and shall use his
best efforts, skills and abilities to promote the Company’s interests.  Anything herein to the contrary notwithstanding,
the Executive shall not be precluded from engaging in charitable and community
affairs and managing his personal investments. 
It is expressly understood and agreed that, to the extent any such
activities have been conducted by the Executive prior to the date of this
Agreement and disclosed to the Board, the continued conduct of such activities
(or activities similar in nature and scope thereto) after the date of this
Agreement shall be deemed not to interfere with the Executive’s duties and obligations
to the Company under this Agreement. 
The Executive also may serve as a member of the board of directors of
other corporations, subject to the approval of a majority of the Board, which
approval shall not be unreasonably withheld or delayed.

 

6

 

3.                                       COMPENSATION.

 

3.1              Base Salary.  During the Term of Employment, the Executive
shall be entitled to receive a base salary (the “Base Salary”) payable no less
frequently than in equal bi-weekly installments at an annualized rate of no
less than $1,095,000.  The Base Salary
shall be reviewed annually for increase (but not decrease) in the discretion of
the Human Resources Committee of the Board. 
In conducting any such annual review, the Human Resources Committee
shall take into account any change in the Executive’s responsibilities,
increases in the compensation of other executives of the Company or any
Affiliate (or any competitor(s) of either or both), the performance of the
Executive and/or other pertinent factors. 
Such increased Base Salary shall then constitute the Executive’s “Base
Salary” for purposes of this Agreement.

 

3.2              Annual Bonus.  The Company may pay the Executive an annual
discretionary bonus for each fiscal year ending during the Term of Employment
in an amount that will be determined by the Human Resources Committee based on
the Executive’s performance.  Any annual
bonus that may be awarded to the Executive shall be paid at the same time as
annual bonuses are paid to other senior officers of the Company, unless the
Executive has elected to defer receipt of all or part of the bonus amounts to
which he is entitled in respect of any such calendar year in accordance with
the terms and provisions of any deferred compensation program maintained by the
Company.

 

3.3              Stay-On Incentives.  The Executive shall be eligible to receive a
long-term stay-on performance incentive payment pursuant to the terms of the
Long-Term Stay-On Performance Incentive Agreement.

 

3.4              Deferred Compensation.  The Executive shall be eligible to
participate in the Company’s Deferred Compensation Plan for Executives, and any
other deferred compensation plans that the Company may adopt for executives,
pursuant to the terms of the plans.

 

4.                                       EMPLOYEE
BENEFIT PLANS AND PROGRAMS.

 

4.1              Pension and Welfare Benefit Plans.  During the Term of Employment, the Executive
shall be entitled to participate in all employee benefit programs made
available to the Company’s executives or salaried employees generally, as such
programs may be in effect from time to time, including, without limitation,
pension and other retirement plans, profit sharing plans, group life insurance,
group health insurance, accidental death and dismemberment insurance, long-term
disability, sick leave (including salary continuation arrangements), vacations,
holidays and other employee benefit programs sponsored by the Company.

 

4.2              Additional Pension and Welfare
Benefits.  In addition to
the foregoing, the Company shall provide the Executive with the following
benefits:

 

(a)               group
health insurance coverage through the Company’s Exec-U-Care Medical Plan,
effective as of July 1, 1994, or pursuant to such other plan 

 

7

 

or plans as the Company may select from time to time, and which shall
be fully paid for by the Company;

 

(b)              full
salary continuation during the first ninety (90) days of any physical or mental
incapacity that prevents the Executive from performing his duties and, for any
Disability that continues thereafter, benefits pursuant to the Company’s
Special Long-Term Disability Plan and any other long-term disability benefits
pursuant to any other disability plan of which the Executive is a participant;

 

(c)               an
annual supplemental retirement benefit as set forth in the Supplemental
Management Retirement Plan, in addition to any other benefit pursuant to any
other retirement plan under which the Executive is covered; and

 

(d)              supplemental
life insurance coverage, through an individual policy, a group policy or a
combination thereof, in an aggregate amount of not less than $35 million.

 

5.                                       BUSINESS
EXPENSE REIMBURSEMENT AND PERQUISITES.

 

5.1              Expense Reimbursement; Security
Arrangements.  During the
Term of Employment, the Executive shall be entitled to receive reimbursement by
the Company for all reasonable out-of-pocket expenses incurred by him in
performing services under this Agreement, subject to providing the proper
documentation of said expenses.  During
the Term of Employment, the Company shall also provide the Executive, if he so
chooses, with appropriate security arrangements (as approved by the Board) at
his residences; provided, however, that any security equipment
installed at such residences shall become the sole property of the Executive
upon the expiration or earlier termination of this Agreement.

 

5.2              Perquisites.  During the Term of Employment, the Executive
shall also be entitled to any of the Company’s executive perquisites in
accordance with the terms and provisions of the applicable policies, including,
without limitation:

 

(a)               use
of an automobile selected by the Executive;

 

(b)              vacation
of four weeks per year;

 

(c)               payment
or reimbursement of the cost of an annual physical examination;

 

(d)              payment
or reimbursement of initiation fees and annual membership fees and assessments
for a country club, a luncheon club and a physical fitness program of the
Executive’s choice; and

 

8

 

(e)               payment
or reimbursement of fees and expenses, up to a maximum amount of $2500.00,
incurred in connection with having this Agreement reviewed by legal counsel of
his own choosing prior to execution.

 

6.                                       TERMINATION
OF EMPLOYMENT.

 

6.1              Termination Due to Death or
Disability.  The
Executive’s employment shall be terminated immediately in the event of his
death or Disability.  In the event of a
termination due to the Executive’s death or Disability, the Executive or his
estate, as the case may be, shall be entitled, in lieu of any other compensation
whatsoever, to:

 

(a)               in
the case of death, his Base Salary at the rate in effect at the time of his
termination for a period of twenty-four (24) months following the termination
of employment;

 

(b)              any
annual bonus awarded but not yet paid;

 

(c)               a
Pro Rata Bonus for the fiscal year in which death or Disability occurs;

 

(d)              in
the case of death, any deferred compensation or bonuses, including interest or
other credits on the deferred amounts to the extent provided in the plans or
programs providing for deferral, and in the case of Disability, immediate
vesting of any deferred compensation or bonuses, including interest or other
credits on the deferred amounts;

 

(e)               immediate
vesting of all restricted stock, stock options, phantom stock units, stock
appreciation rights and similar stock-based or performance-based interests,
which stock options, stock appreciation rights and similar exercisable
interests shall continue to be and shall remain exercisable for the remaining
term of such stock options, stock appreciation rights and similar exercisable
interests, as applicable, as set forth in the agreement granting or otherwise
awarding such stock option, stock appreciation right or similar exercisable
interest as if no termination of employment had occurred;

 

(f)                 reimbursement
of expenses incurred but not paid prior to such termination of employment;

 

(g)              in
the case of Disability, (i) continuation of the Executive’s health and welfare
benefits at the level in effect on the date of termination for a period of
sixty (60) months following the termination of the Executive’s employment, or
(ii) at the Executive’s option, a lump-sum payment to the Executive of the
economic equivalent thereof, as if the Executive’s employment had continued
during such period; and

 

9

 

(h)              such
rights to other benefits as may be provided in applicable plans and programs of
the Company, including, without limitation, applicable employee benefit plans
and programs, according to the terms and provisions of such plans and programs.

 

6.2              Termination by the Company for Cause.  The Company may terminate the Executive’s
employment for Cause at any time during the Term of Employment by giving
written notice to the Executive, authorized by a vote of at least a majority of
the members of the Board, that the Company intends to terminate his employment
for Cause.  Such written notice shall
specify the particular act or acts, or failure to act, providing the basis for
termination.  The Executive shall be
given the opportunity within thirty (30) days of the receipt of such notice to
meet with the Board to defend such act or acts, or failure to act.  If at the conclusion of the Executive’s
presentation of his defense, a majority of the Board, nonetheless, determines
that the Executive’s employment is terminable for Cause, the Executive shall be
given thirty (30) days after such meeting to correct such acts or failure to
act, unless the Board also determines that the Executive’s acts or failure to
act are incapable of correction.  Upon
failure of the Executive within thirty (30) days, to correct such acts or
failure to act, or upon the Board’s determination, that correction is not
possible, the Executive’s employment by the Company shall automatically be
terminated under this Subsection 6.2 for Cause.  During the pendency of the foregoing
process, the Executive shall continue to be paid his Base Salary but shall be
placed on leave of absence status.

 

In the event of a
termination for Cause, the Executive shall be entitled, in lieu of any other
compensation and benefits whatsoever, to:

 

(a)               Base
Salary at the rate in effect at the time of his termination through the date of
termination of employment;

 

(b)              any
annual bonus awarded but not yet paid;

 

(c)               any
deferred compensation or bonuses, including interest or other credits on the
deferred amounts to the extent provided in the plans or programs providing for
deferral;

 

(d)              reimbursement
for expenses incurred but not paid prior to such termination of employment; and

 

(e)               such
rights to other benefits as may be provided in applicable plans and programs of
the Company, including, without limitation, applicable employee benefit plans
and programs, according to the terms and conditions of such plans and programs.

 

Notwithstanding anything
to the contrary in this Subsection 6.2, if the Executive’s employment is
terminated for Cause (i) due to his having been formally charged pursuant to Subsection
1.4(a) but thereafter said charges are dismissed or the Executive is
acquitted, or (ii) due to his having 

 

10

 

been convicted pursuant
to Subsection 1.4(a) but said conviction is subsequently overturned on
appeal and he is not required to submit to re-trial within six (6) months
thereafter, the Executive shall be entitled to the payments and the economic
equivalent of the benefits he would have received if his employment had been
terminated without Cause under Subsection 6.4.

 

6.3              Termination by the Executive Prior to
a Change in Control.  The
Executive may terminate his employment on his own initiative for any reason
prior to a Change in Control upon thirty (30) days prior written notice to the
Company.  Such termination shall have
the same consequences as a termination for Cause under Subsection 6.2.

 

6.4              Termination by the Company Without Cause
Prior to Change in Control. 
Notwithstanding any other provision of this Agreement, the Company may
terminate the Executive’s employment without Cause, other than due to death or
Disability, at any time during the Term of Employment by giving written notice
to the Executive.  In the event that the
Company terminates the Executive’s employment without Cause prior to a Change
in Control, the Executive shall be entitled, in lieu of any other compensation
and benefits whatsoever, to:

 

(a)               a lump-sum payment
equal to three (3) times one hundred ninety percent (190%) of the Executive’s
Base Salary at the rate in effect at the time of his termination;

 

(b)              any annual bonus
awarded but not yet paid;

 

(c)               a Pro-Rata Bonus
for the fiscal year in which such termination of employment occurs;

 

(d)              immediate vesting of
any deferred compensation or bonuses, including interest or other credits on
the deferred amounts to the extent provided in the plans or programs providing
for deferral;

 

(e)               immediate
vesting of all restricted stock, stock options, phantom stock units, stock
appreciation rights and similar stock-based or performance-based interests,
which stock options, stock appreciation rights and similar exercisable
interests shall continue to be and shall remain exercisable for the remaining
term of such stock options, stock appreciation rights and similar exercisable
interests, as applicable, as set forth in the agreement granting or otherwise
awarding such stock option, stock appreciation right or similar exercisable
interest as if no termination of employment had occurred;

 

(f)                 reimbursement of
expenses incurred but not paid prior to such termination of employment;

 

11

 

(g)              (i) continuation of
all benefits provided to the Executive pursuant to Subsection 4.2,
including, without limitation, the Executive’s group health insurance and
participation in the Company’s Special Long-Term Disability Plan and any other
long-term disability insurance generally provided to senior executives of the
Company, at the level in effect at the time of his termination of employment
for a period of sixty (60) months following such termination of employment, or
(ii) at the Executive’s option, a lump-sum payment to the Executive of the
economic equivalent thereof, as if such Executive were employed during such
period; and

 

(h)              such rights to other
benefits as may be provided in applicable plans and programs of the Company,
including, without limitation, applicable employee benefit plans and programs,
according to the terms and conditions of such plans and programs.

 

7.                                      CHANGE
IN CONTROL.

 

7.1              Change in Control.  Immediately upon a Change in Control, in
addition to any other compensation or benefits payable pursuant to this Agreement
or otherwise, the Executive shall be entitled to:

 

(a)               minimum annual
increases in the Executive’s Base Salary equal to the greater of (i) five
percent (5%), or (ii) the percentage of increase in the Consumer Price Index
for the Las Vegas, Nevada, metropolitan area as reported by the United States
Department of Labor for the immediately preceding calendar year;

 

(b)              annual bonuses of at
least ninety percent (90%) of his Base Salary;

 

(c)               immediate vesting
of all benefits, without penalty or reduction in rights or benefits, including,
without limitation, immediate vesting of all restricted stock, stock options,
phantom stock units, stock appreciation rights and similar stock-based or
performance-based interests, which stock options, stock appreciation rights and
similar exercisable interests shall continue to be and shall remain exercisable
for the remaining term of such stock options, stock appreciation rights and
similar exercisable interests, as applicable, as set forth in the agreement
granting or otherwise awarding such stock option, stock appreciation right or
similar exercisable interest;

 

(d)              reimbursement of
expenses incurred but not paid prior to such termination of employment;

 

12

 

(e)               (i) immediate
eligibility for retirement under the Supplemental Management Retirement Plan
without penalty for early retirement, or (ii) at the Executive’s option, a
lump-sum payment to the Executive of the economic equivalent thereof, as if the
Executive received payments under such Plan for a period of fifteen (15) years;

 

(f)                 immediate vesting
of any deferred compensation or bonuses, including interest or other credits on
the deferred amount to the extent provided in the plans or programs providing
for deferral;

 

(g)              immediate vesting
and payout of all amounts set forth in the Long-Term Stay-On Performance
Incentive Agreement, as if the Executive had fully satisfied the terms and
conditions thereof;

 

(h)              (i) continued
funding of the Executive’s split dollar and term life insurance policies and
any other life insurance policies maintained by the Company on behalf of the
Executive as of the date of the Change in Control, as if the Executive were
employed by the Company through the maturity date of such policies or payments
in full of all premium obligations under such policies, or (ii) at the
Executive’s option, a lump-sum payment to the Executive of the economic
equivalent thereof, as if the Executive were employed by the Company through
the maturity date of such policies; and

 

(i)                  such rights to
other benefits as may be provided in applicable plans and programs of the
Company, including, without limitation, applicable employee benefit plans and
programs, according to the terms and conditions of such plans and programs.

 

7.2              Termination by the Company Without
Cause or by the Executive for Good Reason After a Change in Control.  If at any time subsequent to a Change in
Control, the Executive’s employment is terminated by the Company without Cause
or by the Executive for Good Reason, the Executive shall be entitled, in
addition to any compensation and benefits provided pursuant to Subsection
7.1, but in lieu of any other compensation and benefits whatsoever, to:

 

(a)               a lump-sum payment
equal to the greater of (i) four (4) times one hundred ninety percent (190%) of
the Executive’s Base Salary at the time of the Change in Control or
(ii) four (4) times one hundred ninety percent (190%) of the Executive’s
Base Salary at the time of the termination of his employment;

 

(b)              any annual bonus
awarded but not yet paid;

 

(c)               a Pro Rata Bonus
for the fiscal year in which such termination of employment occurs; and

 

13

 

(d)              (i) continuation of
all employee benefits provided to the Executive pursuant to Subsection 4.2,
at the level in effect at the time of his termination of employment, for a
period of sixty (60) months following such termination of employment, or (ii)
at the Executive’s option, a lump-sum payment to the Executive of the economic
equivalent thereof, as if the Executive were an employee of the Company during
such period.

 

7.3              Termination by Executive without Good
Reason After a Change in Control. 
If the Executive terminates his employment without Good Reason
following a Change in Control, the Executive shall be entitled, in addition to
any compensation and benefits provided pursuant to Subsection 7.1, but
in lieu of any other compensation and benefits whatsoever, to:

 

(a)               if such termination
occurs in the first twelve (12) months following a Change in Control, the
Executive shall be entitled to (i) a lump-sum payment equal to eighty percent
(80%) of the amount payable to the Executive pursuant to Subsection 7.2(a),
and (ii) all of the benefits provided in Subsections 6.4(b), (c), (f) and
(g);

 

(b)              if such termination
occurs at any time after the first twelve (12) months following a Change in
Control, the Executive shall be entitled (i) one hundred percent (100%) of the
amount payable to the Executive pursuant to Subsection 7.2(a), and (ii)
all of the benefits provided in Subsections 6.4(b), (c), (f) and (g);
and

 

(c)               in either instance,
the Executive shall also be entitled to such rights to benefits as may be
provided in applicable plans and programs of the Company, including, without
limitation, applicable employee benefit plans and programs, according to the
terms and conditions of such plans and programs.

 

7.4              Termination for Other Reasons After a
Change in Control.  If
the Executive’s employment is terminated after a Change in Control for any
reason not otherwise provided for in this Section 7, his rights shall be
determined in accordance with the applicable subsection of Section 6.

 

7.5              Funding of Payments.  All payments payable to the Executive
pursuant to this Section 7, except for payments payable as a lump sum,
shall be made to a trust which shall be established for such purpose and shall
provide for Towers Perrin (or such other trustee mutually acceptable to the
Company and the Executive) to serve as the trustee thereof.

 

8.                                       CONDITIONS
TO PAYMENTS UPON TERMINATION.

 

8.1              Timing of Payments.  Unless otherwise provided herein, any
payments to which the Executive shall be entitled pursuant to Sections 6
and 7 following the termination of 

 

14

 

his employment shall be made as promptly as possible and in no event
later than five (5) business days following the termination of his employment.

 

8.2              No Mitigation; No Offset.  In the event of any termination of the
Executive’s employment under Sections 6 or 7, the Executive shall be
under no obligation to seek other employment and there shall be no offset
against amounts due to the Executive on account of any remuneration
attributable to any subsequent employment that the Executive may obtain.  Any amounts payable to the Executive under Sections
6 or 7 are in the nature of severance payments, or liquidated damages, or
both, and are not in the nature of a penalty.

 

9.                                       SPECIAL
REIMBURSEMENT.

 

9.1              If any payment or
benefit paid or payable, or received or to be received, by or on behalf of the
Executive , whether any such payments or benefits are pursuant to the terms of
this Agreement or any other plan, program, arrangement or agreement of or with
the Company, any Affiliate, any Person, or otherwise (the “Total Payments”), will or
would be subject to the excise tax imposed under Section 4999 of the Code (the
“Excise
Tax”), the Company shall pay to the Executive an additional amount
(the “Gross-Up
Payment”) such that, after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes)
imposed upon or in respect of the Total Payments and the Gross-Up Payments,
including, without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and any Excise Tax imposed thereon, the Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon
the Total Payments.

 

9.2              For purposes of
determining whether any of the Total Payments will be subject to the Excise Tax
and the amount of such Excise Tax,

 

(a)               the Total Payments
shall be treated as “parachute payments” within the meaning of Section
280G(b)(2) of the Code, and all “excess parachute payments” within the meaning
of Section 280G(b)(1) of the Code shall be treated as subject to the
Excise Tax, unless in the opinion of tax counsel selected by the Company and
reasonably acceptable to the Executive (which opinion shall be provided to the
Executive) such Total Payments (in whole or in part) (i) do not constitute
parachute payments, including (without limitation) by reason of
Section 280G(b)(4)(A) of the Code, (ii) such excess parachute
payments (in whole or in part) represent reasonable compensation for services
actually rendered, within the meaning of Section 280G(b)(4)(B) of the
Code, or (iii) are not, in the opinion of legal counsel, otherwise subject
to the Excise Tax, and

 

(b)              the value of any
non-cash benefits or any deferred payment or benefit shall be determined by the
Company’s independent auditors in accordance with the principles of
Sections 280G(d)(3) and (4) of the Code.

 

15

 

9.3              In the event that
the Excise Tax is subsequently determined to be less than the amount taken into
account hereunder, the Executive shall repay to the Company, at the time that
the amount of such reduction in Excise Tax is finally determined, the portion
of the Gross-Up Payment attributable to such reduction plus interest on the
amount of such repayment at the rate provided in Section 1274(b)(2)(B) of the
Code.  In the event that the Excise Tax
is determined to exceed the amount taken into account hereunder at the time of
the termination of the Executive’s employment (including by reason of any
payment the existence or amount of which cannot be determined at the time of
the initial Gross-Up Payment), the Company shall make an additional Gross-Up
Payment in accordance with Subsection 9.1 in respect of such excess
Excise Tax (plus any interest, penalties or additions payable by the Executive
with respect to such excess Excise Tax) at the time that the amount of such
excess Excise Tax is finally determined. 
The Executive and the Company shall each reasonably cooperate with each
other in connection with any administrative or judicial proceedings concerning
the existence or amount of any such subsequent liability for Excise Tax with
respect to the Total Payments.

 

10.                                 INDEMNIFICATION.

 

10.1        General.  The Company agrees that if the Executive is
made a party or is threatened to be made a party to any action, suit or
proceeding, whether civil, criminal, administrative or investigative (an “Indemnifiable
Action”), by reason of the fact that he is or was a director or
officer of the Company or is or was serving at the request of the Company as a
director, officer, member, employee or agent of another corporation or of a
partnership, joint venture, trust or other enterprise, including service with
respect to employee benefit plans, whether or not the basis of such
Indemnifiable Action is alleged action in an official capacity as a director,
officer, member, employee or agent, he shall be indemnified and held harmless
by the Company to the fullest extent permitted by Nevada law and the Company’s
by-laws, as the same exist or may hereafter be amended (but, in the case of any
such amendment to the Company’s by-laws, only to the extent such amendment
permits the Company to provide broader indemnification rights than the
Company’s by-laws permitted the Company to provide before such amendment),
against all expense, liability and loss (including, without limitation,
attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts
paid or to be paid in settlement) incurred or suffered by the Executive in
connection therewith.

 

10.2        Procedure.  The indemnification provided pursuant to
this Section 10 shall be subject to the following conditions:

 

(a)               The Executive must
promptly give the Company written notice of any actual or threatened
Indemnifiable Action and, upon providing such notice, the Executive shall be
presumed to be entitled to indemnification under this Agreement and the Company
shall have the burden of proof to overcome that presumption in reaching any
contrary determination; provided, however, that the Executive’s
failure to give such notice shall not affect the Company’s obligations
hereunder;

 

16

 

(b)              The Company will be
permitted, at its option, to participate in, or to assume, the defense of any
Indemnifiable Action, with counsel approved by the Executive; provided, however,
that (i) the Executive shall have the right to employ his own counsel in such
Indemnifiable Action at the Executive’s expense; and (ii) if (A) the retention
of counsel by the Executive has been previously authorized by the Company, (B)
the Executive shall have concluded, based on the advice of his legal counsel,
that there may be a conflict of interest between the Company and the Executive
in the conduct of any such defense, or (C) the Company shall not, in fact, have
retained counsel to assume the defense of such Indemnifiable Action, the fees
and expenses of the Executive’s counsel shall be at the expense of the Company;
and provided, further, that the Company shall not settle any
action or claim that would impose any limitation or penalty on the Executive
without obtaining the Executive’s prior written consent, which consent shall
not be unreasonably withheld;

 

(c)               The Executive must
provide reasonable cooperation to the Company in the defense of any
Indemnifiable Action; and

 

(d)              The Executive must
refrain from settling any Indemnifiable Action without obtaining the Company’s
prior written consent, which consent shall not be unreasonably withheld.

 

10.3        Advancement of Costs and Expenses.  The Company agrees to advance all costs and
expenses referred to in Subsections 10.1 and 10.6; provided, however,
that the Executive agrees to repay to the Company all amounts so advanced only
if, and to the extent that, it shall ultimately be determined by a court of
competent jurisdiction that the Executive is not entitled to be indemnified by
the Company as authorized by this Agreement.

 

The advances to be made
hereunder shall be paid by the Company to or on behalf of the Executive within
twenty (20) days following delivery of a written request therefor by the
Executive to the Company.  The
Executive’s entitlement to advancement of costs and expenses hereunder shall
include those incurred in connection with any action, suit or proceeding by the
Executive seeking a determination, adjudication or arbitration in award with
respect to his rights and/or obligations under this Section 10.

 

10.4        Non-Exclusivity of Rights.  The right to indemnification and the payment
of expenses incurred in defending an Indemnifiable Action in advance of its
final disposition conferred in this Section 10 shall not be
exclusive of any other right which the Executive may have or hereafter may
acquire under any statute, provision of the certificate of incorporation or
by-laws of the Company, agreement, vote of stockholders or disinterested
directors or otherwise.

 

10.5        D&O Insurance.  The Company will maintain a directors’ and
officers’ liability insurance policy covering the Executive that provides
coverage that is reasonable in relation to the Executive’s position during the
Term of Employment.

 

17

 

10.6        Witness Expenses.  Notwithstanding any other provision of this
Agreement, the Company shall indemnify the Executive if and whenever he is a witness
or threatened to be made a witness to any action, suit or proceeding to which
the Executive is not a party, by reason of the fact that the Executive is or
was a director or officer of the Company or its Affiliates or by reason of
anything done or not done by him in such capacity, against all expense,
liability and loss incurred or suffered by the Executive in connection
therewith; provided, however, that if the Executive is no longer
employed by the Company, the Company will compensate him, on an hourly basis,
for all time spent, at either his then current compensation rate or his Base
Salary at the rate in effect as of the termination of his employment, whichever
is higher.

 

10.7        Survival.  The provisions of this Section 10
shall survive the expiration or earlier termination of this Agreement,
regardless of the reason for such termination.

 

11.                                 CONFIDENTIAL
INFORMATION AND COMPANY PROPERTY.

 

11.1        Confidential Information.  The Executive understands and acknowledges
that Confidential Information constitutes a valuable asset of the Company and
its Affiliates and may not be converted to the Executive’s own or any third
party’s use.  Accordingly, the Executive
hereby agrees that he shall not directly or indirectly, during the Term of
Employment or for a period of twelve (12) months after the termination of his
employment, disclose any Confidential Information to any Person not expressly
authorized by the Company to receive such Confidential Information.  The Executive further agrees that he shall
not directly or indirectly, during the Term of Employment or for a period of
twelve (12) months after the termination of his employment, use or make use of
any Confidential Information in connection with any business activity other
than that of the Company.  The Parties
acknowledge and agree that this Agreement is not intended to, and does not,
alter either the Company’s rights or the Executive’s obligations under any
state or federal statutory or common law regarding trade secrets and unfair
trade practices.

 

11.2        Company Property.  All Company Property is and shall remain
exclusively the property of the Company. 
Unless authorized in writing to the contrary, the Executive shall
promptly, and without charge, deliver to the Company on the termination of
employment hereunder, or at any other time the Company may so request, all
Company Property that the Executive may then possess or have under his control.

 

11.3        Required Disclosure.  In the event the Executive is required
by law or court order to disclose any Confidential Information or to produce
any Company Property, the Executive shall promptly notify the Company of such
requirement and provide the Company with a copy of any court order or of any
law which requires such disclosure and, if the Company so elects, to the extent
permitted by applicable law, give the Company an adequate opportunity, at its
own expense, to contest such law or court order prior to any such required
disclosure or production by the Executive.

 

18

 

11.4        Survival.  The Executive agrees that the provisions of
this Section 11 shall survive the termination of this Agreement and
the termination of the Executive’s employment.

 

12.                                 DISPUTE
RESOLUTION.  Except as
otherwise provided in Subsection 10.3, the Company agrees that in the
event the Executive finds it necessary to initiate any legal action to obtain
any payments, benefits or rights provided by this Agreement to him, the Company
shall reimburse the Executive for all attorney’s fees and other related
expenses incurred by him to the extent the Executive is successful in such
action.

 

13.                                 NOTICES.  All notices, demands and requests required
or permitted to be given to either Party under this Agreement shall be in
writing and shall be deemed to have been given when delivered personally or
sent by certified or registered mail, postage prepaid, return receipt
requested, duly addressed to the Party concerned at the address indicated below
or to such changed address as such Party may subsequently give notice of:

 

	
  If to the Company:

  	
  Station Casinos, Inc.

  
	
   

  	
  2411 West Sahara Avenue

  
	
   

  	
  Las Vegas, NV  89102

  
	
   

  	
  Attn:  Scott M Nielson

  
	
   

  	
   

  
	
  With a copy to:

  	
  Milbank, Tweed, Hadley
  & McCloy

  
	
   

  	
  601 South Figueroa
  Street, 30th Floor

  
	
   

  	
  Los Angeles, CA  90017

  
	
   

  	
  Attn:  Kenneth J. Baronsky

  
	
   

  	
   

  
	
  If to the Executive:

  	
  Lorenzo J. Fertitta

  
	
   

  	
  2411 W. Sahara Avenue

  
	
   

  	
  Las Vegas, NV  89102

  

 

14.                                 EMPLOYEE
BENEFIT PLAN DOCUMENTS. 
In the event that any terms and provisions of this Agreement conflict
with the terms and provisions of any employee benefit plan document, the terms
and provisions of this Agreement shall govern, and the Company shall take any
and all actions that may be necessary, including amendment of any plan
document, to effect the provision of benefits expressly provided upon termination
of the Executive’s employment pursuant to Sections 6 and 7.

 

15.                                 BENEFICIARIES/REFERENCES.  The Executive shall be entitled to select a
beneficiary or beneficiaries to receive any compensation or benefit payable
hereunder following the Executive’s death, and may change such election, by
giving the Company written notice thereof. 
In the event of the Executive’s death or a judicial determination of his
incompetence, reference in this Agreement to the Executive shall be deemed,
where appropriate, to refer to his beneficiaries, estate or other legal
representative.

 

19

 

16.                                 SURVIVORSHIP.  The respective rights and obligations of the
Parties hereunder shall survive the expiration or earlier termination of this
Agreement to the extent necessary to the intended preservation of such rights
and obligations.  The provisions of this
Section 18 are in addition to the survivorship provisions of any other section
of this Agreement.

 

17.                                 REPRESENTATIONS
AND WARRANTIES.  Each
Party represents and warrants that he or it is fully authorized and empowered
to enter into this Agreement and that the performance of his or its obligations
under this Agreement will not violate any Agreement between that Party and any
other Person.

 

18.                                 ENTIRE
AGREEMENT.  This
Agreement contains the entire agreement between the Parties concerning the
subject matter hereof and supersedes all prior agreements, understandings,
discussions, negotiations and undertakings, whether written or oral, express or
implied, between the Parties with respect hereto.  No representations, inducements, promises or agreements not
embodied herein shall be of any force or effect.

 

19.                                 ASSIGNABILITY;
BINDING NATURE.  This
Agreement shall be binding upon and inure to the benefit of the Parties and
their respective successors, heirs and assigns; provided, however, that no
rights or obligations of the Executive under this Agreement may be assigned or
transferred by the Executive, other than rights to compensation and benefits
hereunder, which may be transferred only by will or operation of law and
subject to the limitations of this Agreement; and provided, further, that no
rights or obligations of the Company under this Agreement may be assigned or
transferred by the Company, except that such rights or obligations may be
assigned or transferred pursuant to a merger or consolidation in which the
Company is not the continuing entity, or the sale or liquidation of all or
substantially all of the assets of the Company, provided that the assignee or
transferee is the successor to all or substantially all of the assets of the
Company and such assignee or transferee assumes the liabilities, obligations
and duties of the Company under this Agreement, either contractually or as a matter
of law.

 

20.                                 AMENDMENT
OR WAIVER.  No provision
in this Agreement may be amended or waived unless such amendment or waiver is
agreed to in writing, signed by both Parties. 
No waiver by one Party of any breach by the other Party of any condition
or provision of this Agreement to be performed by such other Party shall be
deemed a waiver of a similar or dissimilar condition or provision at the same
or any prior or subsequent time.  No
failure of the Company to exercise any power given it hereunder or to insist
upon strict compliance by the Executive with any obligation hereunder, and no
custom or practice at variance with the terms hereof, shall constitute a waiver
of the right of the Company to demand strict compliance with the terms hereof.

 

21.                                 SEVERABILITY.  In the event that any provision or portion
of this Agreement shall be determined to be invalid or unenforceable for any
reason, in whole or in part, the remaining provisions of this Agreement shall
be unaffected thereby and shall remain in full force and effect to the fullest
extent permitted by law.

 

20

 

22.                                 GOVERNING
LAW.  This Agreement
shall be governed by and construed and interpreted in accordance with the laws
of the State of Nevada without reference to the principles of conflict of laws
thereof.  In the event of any dispute or
controversy arising out of or relating to this Agreement that is not an
arbitrable claim, the Parties mutually and irrevocably consent to, and waive
any objection to, the exclusive jurisdiction of any court of competent
jurisdiction in Clark County, Nevada, to resolve such dispute or controversy.

 

23.                                 HEADINGS.  The headings of the sections and subsections
contained in this agreement are for convenience only and shall not be deemed to
control or affect the meaning or construction of any provision of this
Agreement.

 

24.                                 COUNTERPARTS.  This Agreement may be executed in
counterparts, each of which shall be deemed an original and all of which shall
constitute one and the same Agreement with the same effect as if all Parties
had signed the same signature page.  Any
signature page of this Agreement may be detached from any counterpart of this
Agreement and reattached to any other counterpart of this Agreement identical
in form hereto but having attached to it one or more additional signature
pages.

 

IN WITNESS WHEREOF,
the undersigned have executed this Agreement as of the date first written
above.

 

	
   

  	
  STATION CASINOS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  LORENZO J. FERTITTA

  
					

 

21Exhibit
10.3

 

EXECUTIVE
EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT
(this “Agreement”)
is made and entered into as of the 20th day of May, 2003, by and between STATION
CASINOS, INC., a Nevada corporation, with its principal offices
located at 2411 West Sahara Avenue, Las Vegas, Nevada  89102 (the “Company”), and GLENN C. CHRISTENSON (the “Executive”).

 

WHEREAS, the
Company and the Executive are parties to an Amended and Restated Employment
Agreement dated as of December 1, 1999, as amended by that First Amendment
dated October 1, 2001 (collectively, the “Former Agreement”); and

 

WHEREAS, the
Executive has agreed to continue his employment with the Company on the terms
and conditions set forth herein; and

 

WHEREAS, the
parties to this Agreement desire to replace the Former Agreement in its
entirety with this Agreement, and the Former Agreement shall no longer be of
any force or effect;

 

NOW, THEREFORE, in
consideration of the premises and mutual covenants contained herein and for
other good and valuable consideration, the Company and the Executive (each
individually a “Party” and together the “Parties”) agree as follows.

 

1.                                       DEFINITIONS.  In addition to certain terms defined
elsewhere in this Agreement, the following terms shall have the following
respective meanings:

 

1.1                                 “Affiliate”
shall mean any Person controlling, controlled by or under common control with,
the Company.

 

1.2                                 “Base Salary”
shall mean the salary provided for in Subsection 3.1 of this
Agreement, as the same may be increased from time to time thereunder.

 

1.3                                 “Board”
shall mean the Board of Directors of the Company.

 

1.4                                 “Cause”
shall mean that the Executive:

 

(a)                                  has
been convicted of any felony;

 

(b)                                 has
been found unsuitable to hold a gaming license by a final non-appealable
decision of the Nevada Gaming Commission; or

 

(c)                                  in
carrying out his duties under this Agreement, has engaged in acts or omissions
constituting gross negligence or willful misconduct resulting, in either case,
in material economic harm to the Company.

 

1.5                                 “Change in Control”
shall be deemed to have occurred if:

 

	
   

  	
  Executive’s
  Initials          

  
	
   

  	
   

  
	
   

  	
  Company’s
  Initials          

  

 

 

(a)                                  (1)  any Person, corporation, entity or group
(other than the Existing Equity Holders) is or becomes the beneficial owner,
directly or indirectly, of securities representing 50% or more of the combined
voting power of the Company’s Voting Stock (an “Acquisition Event”), or

 

(2)  the Company consolidates with or merges into
another corporation or entity, or any corporation or entity consolidates with
or merges into the Company, with the effect that the beneficial owners of the
Company’s Voting Stock held immediately prior to the consummation of such
consolidation or merger cease to beneficially own, directly or indirectly,
securities representing 50% or more of the combined voting power of the
Company’s Voting Stock (or if the Company is not the surviving entity, the
surviving company’s voting securities) upon the consummation of such
consolidation or merger (a “Merger Event”), or

 

(3)  the Company sells, conveys, transfers or
leases to any person, corporation, entity or group, directly or indirectly, in
one transaction or series of related transactions, properties and/or assets
that accounted for 75% or more of the earnings (before interest, taxes,
depreciation and amortization) of the Company, on a consolidated basis for the
four-fiscal quarter period immediately preceding the date of consummation of
such transaction (a “Sale Event”); and

 

(b)                                 within
thirty-six (36) months following an Acquisition Event, Merger Event or Sale
Event, individuals who immediately prior to such Acquisition Event, Merger
Event or Sale Event constituted the Company’s Board, together with any new or
replacement directors whose election by the Company’s Board, or whose
nomination for election by the Company’s stockholders was approved by a vote of
at least a majority of the directors then in office who were either directors
on the Company’s Board immediately prior to such Acquisition Event, Merger
Event or Sale Event (or whose election or nomination for election was
previously so approved), cease for any reason to constitute a majority of the
directors of the Company’s Board then in office.

 

Notwithstanding the
foregoing, a reincorporation, spin-off, split-off or other reorganization
transaction (a “Reorganization Event”), or series of related transactions, in
which either the “beneficial owners” of the Company’s Voting Stock or the
Existing Equity Holders beneficially own securities representing 50% or more of
the combined voting power of the Company’s Voting Stock upon the consummation
of such transaction shall not constitute an Acquisition Event, Merger Event or
Sale Event for purposes of this definition. 
For purposes of this definition, “beneficial ownership” shall have the
same meaning as defined in Rules 13d-3 and 13d-5 under the Securities Exchange
Act of 1934, as amended, except that a Person shall be deemed to have
“beneficial ownership” of all shares that any such Person has the right to
acquire, whether such right is exercisable immediately or only after the
passage of time.  For the purposes of
this definition, upon consummation of an Acquisition Event, Merger Event, Sale
Event or Reorganization Event, the “Company’s Board” and the “Company’s
Shareholders” 

 

2

 

shall refer to (i) in
the case of an Acquisition Event, the Company, (ii) in the case of a Merger
Event, the company surviving the merger or consolidation, (iii) in the case of
a Sale Event, the transferee of the properties, and/or assets, and (iv) in the
case of a Reorganization Event, the entity or entities surviving such
Reorganization Event on a consolidated basis.

 

1.6                                 “Code”
shall mean the Internal Revenue Code of 1986, as amended.

 

1.7                                 “Company Property”
shall mean all items and materials provided by the Company to the Executive, or
to which the Executive has access, in the course of his employment, including,
without limitation, all files, records, documents, drawings, specifications,
memoranda, notes, reports, manuals, equipment, computer disks, videotapes,
drawings, blueprints and other documents and similar items relating to the
Company, its Affiliates or their respective customers, whether prepared by the
Executive or others, and any and all copies, abstracts and summaries thereof.

 

1.8                                 “CompetingBusiness” shall mean any Person engaged in the gaming industry
that directly or through an affiliate or subsidiary conducts its business
within the Restricted Area.

 

1.9                                 “Confidential
Information” shall mean all nonpublic and/or proprietary information
respecting the business of the Company or any Affiliate, including, without
limitation, its products, programs, projects, promotions, marketing plans and
strategies, business plans or practices, business operations, employees,
research and development, intellectual property, software, databases,
trademarks, pricing information and accounting and financing data.  Confidential Information also includes
information concerning the Company’s or any Affiliate’s customers, such as
their identity, address, preferences, playing patterns and ratings or any other
information kept by the Company or any Affiliate concerning its customers
whether or not such information has been reduced to documentary form.  Confidential Information does not include
information that is, or becomes, available to the public unless such
availability occurs through an unauthorized act on the part of the Executive.

 

1.10                           “Deferred
Compensation Plan for Executives” shall mean the Company’s Deferred
Compensation Plan for  Executives, effective as of November 30,
1994, as the same may be amended from time to time.

 

1.11                           “Disability”
shall mean a physical or mental incapacity that prevents the Executive from
performing the essential functions of his position with the Company for a
period of ninety (90) days as determined (a) in accordance with any long-term
disability plan provided by the Company of which the Executive is a
participant, or (b) by the following procedure:  The Executive agrees to submit to medical examinations by a
licensed healthcare professional selected by the Company, in its sole
discretion, to determine whether a Disability exists.  In addition, the Executive may submit to the Company documentation
of a Disability, or lack thereof, from a licensed healthcare professional of
his choice.  Following a determination
of a Disability or lack of Disability by the Company’s or the Executive’s
licensed healthcare professional, the other Party may submit subsequent
documentation relating to the existence of a Disability from a licensed
healthcare professional selected by such other Party.  In the event that the medical opinions of such licensed
healthcare professionals conflict, such licensed healthcare

 

3

 

professionals shall appoint a third licensed healthcare professional to
examine the Executive, and the opinion of such third licensed healthcare
professional shall be dispositive.

 

1.12                           “ERISA”
shall mean the Employee Retirement Income Security Act of 1974, as amended.

 

1.13                           “Existing
Equity Holders” shall mean Frank J. Fertitta III, Blake L. Sartini,
Delise F. Sartini, Lorenzo J. Fertitta, Glenn C. Christenson and Scott M
Nielson and their executors, administrators or the legal representatives of
their estates, their heirs, distributees and beneficiaries, and any trust as to
which any of the foregoing is a settlor or co-settlor and any corporation,
partnership or other entity which is an affiliate of any of the foregoing, and
any lineal descendants of such persons (but only to the extent that the
beneficial ownership of the Voting Stock held by such lineal descendants was
directly received by gift, trust or sale from any such person).

 

1.14                           “Good Reason,”
as used in Subsection 7.2, shall mean and exist if there has been a
Change in Control and, thereafter, without the Executive’s prior written
consent, one or more of the following events occurs:

 

(a)                                  the
Executive is assigned duties or responsibilities that are inconsistent, in any
significant respect, with the position of a senior manager;

 

(b)                                 the
Executive is required to relocate from, or maintain his principal office
outside of, Clark County, Nevada;

 

(c)                                  the
Executive’s Base Salary is decreased by the Company;

 

(d)                                 the
Executive is excluded from participation in any employee benefit or short-term
incentive plan or program offered to other similarly executives of the Company
or his benefits under such plans or programs are materially reduced;

 

(e)                                  the
Company fails to pay the Executive any deferred payments that have become
payable under the Deferred Compensation Plan for Executives;

 

(f)                                    theCompany fails to reimburse the Executive for business expenses in
accordance with the Company’s policies, procedures or practices;

 

(g)                                 the
Company fails to agree to or to actually indemnify the Executive for his
actions and/or inactions, as either a director or an officer of the Company, in
accordance with Section 10, and/or the Company fails to maintain
reasonably sufficient levels of directors’ and officers’ liability insurance
coverage for the Executive when such insurance is available; or

 

(h)                                 the
Company fails to obtain a written agreement from any successor or assign of the
Company to assume the obligations under this Agreement upon a Change in Control.

 

4

 

For purposes of this
Agreement, a determination by the Executive that the Executive has “Good
Reason” shall be final and binding on the Company and the Executive absent a
showing of bad faith on the part of the Executive.

 

1.15                           “Long-Term
Stay-On Performance Incentive Plan” shall mean the Company’s
Long-Term Stay-On Performance Incentive Plan, effective as of September 27,
1994, as the same may be amended from time to time.

 

1.16                           “Person”
shall mean any individual, firm, partnership, association, trust, company,
corporation or other entity.

 

1.17                           “Pro Rata
Bonus” shall mean an amount equal to sixty percent (60%) of the
Executive’s current Base Salary, multiplied by a fraction, the numerator of
which is the number of days in such year during which the Executive was
actually employed by the Company and the denominator of which is 365.

 

1.18                           “Restricted
Area” shall mean the City of Las Vegas, Nevada, and the area within
a twenty-five (25) mile radius of that city; provided, however,
that in the event the Executive voluntarily terminates this Agreement pursuant
to Subsection 6.3, the Restricted Area shall exclude the Las Vegas
Strip (which is defined as that area bounded by Paradise Road and straight
extensions thereof on the East, Charleston Boulevard on the North, I-15 on the
West, and Sunset Road on the South) and Downtown Las Vegas (which is defined as
that area bounded by Eastern Avenue and straight extensions thereof on the
East, I-515 (U.S. Highway 93/95) on the North, I-15 on the West, and Charleston
Boulevard on the South).

 

1.19                           “Restriction
Period” shall mean the period ending twenty-four (24) months after
the termination or expiration of the Term of Employment, regardless of the
reason for such termination or expiration.

 

1.20                           “Special
Long-Term Disability Plan” shall mean the Company’s Special
Long-Term Disability Plan, effective as of November 30, 1994, as the same may
be amended from time to time.

 

1.21                           “Supplemental
Management Retirement Plan” shall mean the Company’s Supplemental
Management Retirement Plan, effective as of November 30, 1994, as the same may
be amended from time to time.

 

1.22                           “Term of
Employment” shall mean the period specified in Subsection 2.2.

 

1.23                           “Voting Stock”
shall mean capital stock of any class or classes having general voting power
under ordinary circumstances, in the absence of contingencies, to elect the
directors of a corporation.

 

5

 

2.                                       TERM OF EMPLOYMENT, POSITION AND RESPONSIBILITIES.

 

2.1                                 Employment
Accepted.  The Company
hereby employs the Executive, and the Executive hereby accepts employment with
the Company, for the Term of Employment, in the position and with the
responsibilities set forth in Subsection 2.3 and upon such other terms
and conditions as are stated in this Agreement.

 

2.2                                 Term of Employment.  The initial Term of Employment shall
commence upon the date of this Agreement and, unless earlier terminated
pursuant to the provisions of this Agreement, shall terminate upon the close of
business on the day immediately preceding the fifth anniversary of the date of
this Agreement; provided, however, that the initial Term of
Employment shall automatically be extended for successive five-year periods if
neither Party has advised the other in writing in accordance with Section 14
at least twelve (12) months prior to the end of the then current Term of
Employment that such Term of Employment will not be extended for an additional
five year period.  In the event that
such notice is given, the Executive’s employment shall terminate upon the close
of business on the day immediately preceding the fifth anniversary of the then
current Term of Employment.

 

2.3                                 Responsibilities.  During the Term of Employment, the Executive
shall be employed as Executive Vice President, Chief Financial Officer, Chief
Administrative Officer and Treasurer of the Company, or in such other capacity
as the Company may direct, and shall have such responsibilities as the Company
may direct from time to time.  During
the Term of Employment, the Executive shall devote his full time and attention
to the business and affairs of the Company and shall use his best efforts,
skills and abilities to promote the Company’s interests.  Anything herein to the contrary
notwithstanding, the Executive shall not be precluded from engaging in
charitable and community affairs and managing his personal investments.  It is expressly understood and agreed that,
to the extent any such activities have been conducted by the Executive prior to
the date of this Agreement and disclosed to the Board, the continued conduct of
such activities (or activities similar in nature and scope thereto) after the
date of this Agreement shall be deemed not to interfere with the Executive’s duties
and obligations to the Company under this Agreement.  The Executive also may serve as a member of the board of
directors of other corporations, subject to the approval of a majority of the
Board, which approval shall not be unreasonably withheld or delayed.

 

3.                                       COMPENSATION.

 

3.1                                 Base
Salary.  During the Term
of Employment, the Executive shall be entitled to receive a base salary (the
“Base Salary”) payable no less frequently than in equal bi-weekly installments
at an annualized rate of no less than $695,000.  The Base Salary shall be reviewed annually for increase (but not
decrease) in the discretion of the Human Resources Committee of the Board.  In conducting any such annual review, the
Human Resources Committee shall take into account any change in the Executive’s
responsibilities, increases in the compensation of other executives of the
Company or any Affiliate (or any competitor(s) of either or both), the
performance of the Executive and/or other pertinent factors.  Such increased Base Salary shall then
constitute the Executive’s “Base Salary” for purposes of this Agreement.

 

6

 

3.2                                 Annual
Bonus.  The Company may
pay the Executive an annual discretionary bonus for each fiscal year ending
during the Term of Employment in an amount that will be determined by the Human
Resources Committee based on the Executive’s performance.  Any annual bonus that may be awarded to the
Executive shall be paid at the same time as annual bonuses are paid to other
senior officers of the Company, unless the Executive has elected to defer
receipt of all or part of the bonus amounts to which he is entitled in respect
of any such calendar year in accordance with the terms and provisions of any
deferred compensation program maintained by the Company.

 

3.3                                 Stay-On
Incentives.  The
Executive shall be eligible to participate in the Company’s Long-Term Stay-On
Performance Incentive Plan pursuant to the terms of the Plan.

 

3.4                                 Deferred
Compensation.  The
Executive shall be eligible to participate in the Company’s Deferred
Compensation Plan for Executives, and any other deferred compensation plans
that the Company may adopt for executives, pursuant to the terms of the plans.

 

4.                                       EMPLOYEE BENEFIT PLANS AND PROGRAMS.

 

4.1                                 Pension
and Welfare Benefit Plans. 
During the Term of Employment, the Executive shall be entitled to
participate in all employee benefit programs made available to the Company’s
executives or salaried employees generally, as such programs may be in effect
from time to time, including, without limitation, pension and other retirement
plans, profit sharing plans, group life insurance, group health insurance,
accidental death and dismemberment insurance, long-term disability, sick leave
(including salary continuation arrangements), vacations, holidays and other
employee benefit programs sponsored by the Company.

 

4.2                                 Additional
Pension and Welfare Benefits. 
In addition to the foregoing, the Company shall provide the Executive
with the following benefits:

 

(a)                                  group
health insurance coverage through the Company’s Exec-U-Care Medical Plan,
effective as of July 1, 1994, or pursuant to such other plan or plans as the
Company may select from time to time, and which shall be fully paid for by the
Company; in addition, if the Executive’s employment is terminated pursuant to Section
6 or Section 7 for any reason that permits him to continue his
participation under any group health plan sponsored by the Company after
termination, the Executive shall be permitted to continue his participation
beyond the period provided for in the applicable subsection, at his own
expense, until the earlier of the date he becomes eligible to participate in
any other employer’s group health plan and his reaching age 62, provided that
the Company’s group health insurance carrier at the time permits such continued
participation;

 

(b)                                 full
salary continuation during the first ninety (90) days of any physical or mental
incapacity that prevents the Executive from performing his duties and, for any
Disability that continues thereafter, benefits pursuant to the 

 

7

 

Company’s
Special Long-Term Disability Plan and any other long-term disability benefits
pursuant to any other disability plan of which the Executive is a participant;

 

(c)                                  an
annual supplemental retirement benefit as set forth in the Supplemental
Management Retirement Plan, in addition to any other benefit pursuant to any
other retirement plan under which the Executive is covered; and

 

(d)                                 supplemental
life insurance coverage, through an individual policy, a group policy or a
combination thereof, in an aggregate amount of not less than $7.5 million.

 

5.                                       BUSINESS
EXPENSE REIMBURSEMENT AND PERQUISITES.

 

5.1                                 Expense
Reimbursement.  During the Term of Employment, the Executive
shall be entitled to receive reimbursement by the Company for all reasonable
out-of-pocket expenses incurred by him in performing services under this
Agreement, subject to providing the proper documentation of said expenses.

 

5.2                                 Perquisites.  During the Term of Employment, the Executive
shall also be entitled to any of the Company’s executive perquisites in
accordance with the terms and provisions of the applicable policies, including,
without limitation:

 

(a)                                  vacation
of four weeks per year;

 

(b)                                 payment
or reimbursement of the cost of an annual physical examination;

 

(c)                                  payment
or reimbursement of initiation fees and annual membership fees and assessments
for a country club, a luncheon club and a physical fitness program of the
Executive’s choice; and

 

(d)                                 payment
or reimbursement of fees and expenses, up to a maximum amount of $2500.00,
incurred in connection with having this Agreement reviewed by legal counsel of
his own choosing prior to execution.

 

6.                                       TERMINATION
OF EMPLOYMENT.

 

6.1                                 Termination
Due to Death or Disability. 
The Executive’s employment shall be terminated immediately in the event
of his death or Disability.  In the
event of a termination due to the Executive’s death or Disability, the
Executive or his estate, as the case may be, shall be entitled, in lieu of any
other compensation whatsoever, to:

 

(a)                                  Base
Salary at the rate in effect at the time of his termination until the date of
death or Disability;

 

(b)                                 any
annual bonus awarded but not yet paid;

 

8

 

(c)                                  a
Pro Rata Bonus for the fiscal year in which death or Disability occurs;

 

(d)                                 immediate
vesting of any deferred compensation or bonuses, including interest or other
credits on the deferred amounts, to the extent provided in the plans or
programs providing for deferral;

 

(e)                                  reimbursement of expenses incurred but not paid
prior to such termination of employment; and

 

(f)                                    such
rights to other benefits as may be provided in applicable plans and programs of
the Company, including, without limitation, applicable employee benefit plans
and programs, according to the terms and provisions of such plans and programs.

 

6.2                                 Termination
by the Company for Cause. 
The Company may terminate the Executive’s employment for Cause at any time
during the Term of Employment by giving written notice to the Executive.  In the event of a termination for Cause, the
Executive shall be entitled, in lieu of any other compensation and benefits
whatsoever, to:

 

(a)                                  Base
Salary at the rate in effect at the time of his termination through the date of
termination of employment;

 

(b)                                 any
annual bonus awarded but not yet paid;

 

(c)                                  immediate
vesting of any deferred compensation or bonuses, including interest or other
credits on the deferred amounts to the extent provided in the plans or programs
providing for deferral;

 

(d)                                 reimbursement
for expenses incurred but not paid prior to such termination of employment; and

 

(e)                                  such
rights to other benefits as may be provided in applicable plans and programs of
the Company, including, without limitation, applicable employee benefit plans
and programs, according to the terms and conditions of such plans and programs.

 

Notwithstanding anything
to the contrary in this Subsection 6.2, if the Executive’s employment is
terminated for Cause (i) due to his having been formally charged pursuant to Subsection
1.4(a) but thereafter said charges are dismissed or the Executive is
acquitted, or (ii) due to his having been convicted pursuant to Subsection
1.4(a) but said conviction is subsequently overturned on appeal and he is
not required to submit to re-trial within six (6) months thereafter, the
Company shall have the option of reinstating the Executive with payment of all
base salary payments that would have been paid to him had his employment not
been terminated and restoration of all benefits provided for pursuant to Section 4,
or making a payment to him of an amount equal to three times one hundred sixty
percent (160%) of the Executive’s Base Salary at the rate in effect at the time
of his termination.

 

9

 

6.3                                 Termination
by the Executive.  The
Executive may terminate his employment on his own initiative for any reason
prior to a Change in Control upon thirty (30) days prior written notice to the
Company.  Such termination shall have
the same consequences as a termination for Cause under Subsection 6.2,
except that the Executive shall not be entitled to immediate vesting of any
deferred compensation or bonuses as provided or permitted in Subsection
6.2(c).

 

6.4                                 Termination
by the Company Without Cause Prior to a Change in Control.  Notwithstanding any other provision of this
Agreement, the Company may terminate the Executive’s employment without Cause,
other than due to death or Disability, at any time during the Term of
Employment by giving written notice to the Executive.  In the event that the Company terminates the Executive’s
employment without Cause prior to a Change in Control, the Executive shall be
entitled, in lieu of any other compensation and benefits whatsoever, to:

 

(a)                                  an
amount equal to three times one hundred sixty percent (160%) of the Executive’s
Base Salary at the rate in effect at the time of his termination, one-third of
which shall be paid in a lump sum upon satisfaction of the conditions set forth
in Subsection 8.3, and the other two-thirds of which shall be paid out
in equal bi-weekly installments for the duration of the Restriction Period;

 

(b)                                 any
annual bonus awarded but not yet paid and a Pro Rata Bonus for the fiscal year
in which such termination of employment occurs;

 

(c)                                  immediate
vesting of any deferred compensation or bonuses, including interest or other
credits on the deferred amounts, to the extent provided in the plans or
programs providing for deferral;

 

(d)                                 exercise,
within one hundred eighty (180) days, all stock options that have vested prior
to termination, and shall forfeit all stock options that have not vested;

 

(e)                                  reimbursement
for expenses incurred but not paid prior to such termination of employment; and

 

(f)                                    continuation
of the Executive’s medical insurance, at the Company’s expense, for thirty-six
(36) months or, at the Company’s option, payment to the Executive of the
economic equivalent thereof.

 

6.5                                 Termination
Due to Expiration of the Term of Employment.  If either Party elects not to extend the
initial Term of Employment or any successive Term of Employment, the Executive
shall not be entitled to any additional compensation after the expiration
thereof, but such termination of employment shall not otherwise affect accrued
but unpaid compensation or benefits provided under this Agreement or pursuant
to any Company plan or program.

 

10

 

7.                                       CHANGE IN CONTROL.

 

7.1                                 Change in
Control.  Immediately
upon a Change in Control, in addition to any other compensation or benefits
payable pursuant to this Agreement or otherwise, the Executive shall be
entitled to (a) immediate vesting of all restricted stock, stock options,
phantom stock units, stock appreciation rights and similar stock-based or
performance-based interests, and (b) immediate vesting of any deferred
compensation or bonuses, including interest or other credits on the deferred
amounts, to the extent provided for in the plans or programs providing for
deferral.

 

7.2                                 Termination
by the Company Without Cause or by the Executive for Good Reason After a Change
in Control.  If within
five years following a Change in Control, the Executive’s employment is
terminated by the Company without Cause or by the Executive for Good Reason,
the Executive shall be entitled, in addition to any compensation and benefits
provided pursuant to Subsection 7.1, but in lieu of any other
compensation and benefits whatsoever, to:

 

(a)                                  a
lump sum payment equal to the greater of (i) three times one hundred sixty
percent (160%) of the Executive’s Base Salary at the time of the Change in
Control or (ii) three times one hundred sixty percent (160%) of the
Executive’s Base Salary at the time of the termination of his employment;

 

(b)                                 a
Pro Rata Bonus for the fiscal year in which such termination of employment
occurs;

 

(c)                                  any
deferred bonus, including interest or other credits on the deferred amounts, to
the extent provided in the plans or programs providing for deferral;

 

(d)                                 exercise, within one hundred eighty (180) days,
all vested stock options, stock appreciation rights and other exercisable
stock-based or performance-based interests;

 

(e)                                  immediate
vesting and pay out of any shares awarded to the Executive pursuant to the
Company’s Long-Term Stay-On Performance Incentive Plan;

 

(f)                                    immediate
vesting of the Executive’s supplemental retirement benefit as set forth in the
Supplemental Management Retirement Plan;

 

11

 

(g)                                 (i)
continued funding of the Executive’s split dollar life insurance policy as if
the Executive were employed by the Company through the maturity date of such
policy or payment in full of all premium obligations under such policy, or (ii)
at the Executive’s option, a lump-sum payment to the Executive of the economic
equivalent thereof, as if the Executive were employed by the Company through
the maturity date of such policy; and

 

(h)                                 (i)
continuation of the Executive’s medical insurance, at the Company’s expense,
for thirty-six (36) months, or (ii) at the Executive’s option, a lump-sum
payment to the Executive of the economic equivalent thereof.

 

7.3                                 Termination
by Executive without Good Reason After a Change in Control.  If the Executive terminates his employment
without Good Reason within ninety (90) days following the first anniversary of
a Change in Control, the Executive shall be entitled, in addition to any
compensation and benefits provided pursuant to Subsection 7.1, but in
lieu of any other compensation and benefits whatsoever, to:

 

(a)                                  a
lump sum payment equal to the greater of (i) three times one hundred sixty
percent (160%) of the Executive’s Base Salary at the time of the Change in
Control or (ii) three times one hundred sixty percent (160%) of the Executive’s
Base Salary at the time of the termination of his employment;

 

(b)                                 a
Pro Rata Bonus for the fiscal year in which such termination of employment
occurs;

 

(c)                                  any
deferred bonus, including interest or other credits on the deferred amounts, to
the extent provided in the plans or programs providing for deferral;

 

(d)                                 exercise, within one hundred eighty (180) days,
all vested stock options, stock appreciation rights and other exercisable
stock-based or performance-based interests;

 

(e)                                  immediate
vesting of the Executive’s supplemental retirement benefit as set forth in the
Supplemental Management Retirement Plan;

 

(f)                                    (i)
continued funding of the Executive’s split dollar life insurance policy as if
the Executive were employed by the Company through the maturity date of such
policy or payment in full of all premium obligations under such policy, or (ii)
at the Executive’s option, a lump-sum payment to the Executive of the economic
equivalent thereof, as if the Executive were employed by the Company through
the maturity date of such policy; and

 

(g)                                 (i)
continuation of the Executive’s medical insurance, at the Company’s expense,
for thirty-six (36) months, or (ii) at the Executive’s option, a lump-sum
payment to the Executive of the economic equivalent thereof.

 

12

 

7.4                                 Termination
for Other Reasons After a Change in Control.  If the Executive’s employment is terminated
after a Change in Control for any reason not otherwise provided for in this Section
7, his rights shall be determined in accordance with the applicable
subsection of Section 6.

 

8.                                       CONDITIONS TO PAYMENTS UPON TERMINATION.

 

8.1                                 Timing of
Payments.  Unless
otherwise provided herein, any payments to which the Executive shall be
entitled pursuant to Sections 6 and 7 shall be payable upon the
satisfaction of the conditions set forth in Subsection 8.3.

 

8.2                                 No
Mitigation; No Offset. 
In the event of any termination of the Executive’s employment under Sections
6 or 7, the Executive shall be under no obligation to seek other employment
and there shall be no offset against amounts due to the Executive on account of
any remuneration attributable to any subsequent employment that the Executive
may obtain.  Notwithstanding any
contrary provision contained herein, in the event of any termination of
employment of the Executive, the exclusive remedies available to the Executive
shall be the amounts due under Sections 6 or 7, which are in the nature
of severance payments, or liquidated damages, or both, and are not in the
nature of a penalty.  In the event of a
termination of this Agreement, neither Party shall publish in any way or make
any negative comment or statement about the other Party or concerning the
reasons for such termination.  The
provisions of this Subsection 8.2 shall survive the expiration or
earlier termination of this Agreement.

 

8.3                                 General
Release.  No payments or
benefits payable to the Executive upon the termination of his employment
pursuant to Sections 6 or 7 shall be made to the Executive unless and
until he executes a general release substantially in the form annexed to this
Agreement as Exhibit A and such general release becomes effective pursuant to
its terms.

 

8.4                                 Compliance
with the Agreement.  No
payments or benefits payable to the Executive upon the termination of his
employment pursuant to Sections 6 or 7 shall be made to the Executive if
he fails to comply with all of the terms and conditions of this Agreement,
including, without limitation, Sections 11 and 12.

 

8.5                                 Continuing
Obligations of Executive. 
No act or omission by the Executive in breach of this Agreement,
including, without limitation his failure to execute the general release and
the resulting forfeiture of termination payments, shall be deemed to permit the
Executive to forego or waive such payments in order to avoid his obligations
under Section 11.

 

9.                                       SPECIAL REIMBURSEMENT.

 

9.1                                 If
any payment or benefit paid or payable, or received or to be received, by or on
behalf of the Executive, whether any such payments or benefits are pursuant to
the terms of this Agreement or any other plan, program, arrangement or
agreement of or with the Company, any Affiliate, any Person, or otherwise (the
“Total
Payments”), will or would be subject to the

 

13

 

excise tax imposed under Section 4999 of the Code (the “Excise Tax”),
the Company shall pay to the Executive an additional amount (the “Gross-Up
Payment”) such that, after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes)
imposed upon or in respect of the Total Payments and the Gross-Up Payments,
including, without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and any Excise Tax imposed thereon, the Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon
the Total Payments.

 

9.2                                 For
purposes of determining whether any of the Total Payments will be subject to
the Excise Tax and the amount of such Excise Tax,

 

(a)                                  the
Total Payments shall be treated as “parachute payments” within the meaning of
Section 280G(b)(2) of the Code, and all “excess parachute payments” within the
meaning of Section 280G(b)(1) of the Code shall be treated as subject to
the Excise Tax, unless in the opinion of tax counsel selected by the Company
and reasonably acceptable to the Executive (which opinion shall be provided to
the Executive) such Total Payments (in whole or in part) (i) do not constitute
parachute payments, including (without limitation) by reason of
Section 280G(b)(4)(A) of the Code, (ii) such excess parachute
payments (in whole or in part) represent reasonable compensation for services
actually rendered, within the meaning of Section 280G(b)(4)(B) of the
Code, or (iii) are not, in the opinion of legal counsel, otherwise subject
to the Excise Tax, and

 

(b)                                 the
value of any non-cash benefits or any deferred payment or benefit shall be
determined by the Company’s independent auditors in accordance with the
principles of Sections 280G(d)(3) and (4) of the Code.

 

9.3                                 In
the event that the Excise Tax is subsequently determined to be less than the
amount taken into account hereunder, the Executive shall repay to the Company,
at the time that the amount of such reduction in Excise Tax is finally
determined, the portion of the Gross-Up Payment attributable to such reduction
plus interest on the amount of such repayment at the rate provided in Section
1274(b)(2)(B) of the Code.  In the event
that the Excise Tax is determined to exceed the amount taken into account
hereunder at the time of the termination of the Executive’s employment
(including by reason of any payment the existence or amount of which cannot be
determined at the time of the initial Gross-Up Payment), the Company shall make
an additional Gross-Up Payment in accordance with Subsection 9.1 in
respect of such excess Excise Tax (plus any interest, penalties or additions
payable by the Executive with respect to such excess Excise Tax) at the time
that the amount of such excess Excise Tax is finally determined.  The Executive and the Company shall each
reasonably cooperate with each other in connection with any administrative or
judicial proceedings concerning the existence or amount of any such subsequent
liability for Excise Tax with respect to the Total Payments.

 

14

 

10.                                 INDEMNIFICATION.

 

10.1                           General.  The Company agrees that if the Executive is
made a party or is threatened to be made a party to any action, suit or proceeding,
whether civil, criminal, administrative or investigative (an “Indemnifiable
Action”), by reason of the fact that he is or was a director or
officer of the Company or is or was serving at the request of the Company as a
director, officer, member, employee or agent of another corporation or of a
partnership, joint venture, trust or other enterprise, including service with
respect to employee benefit plans, whether or not the basis of such
Indemnifiable Action is alleged action in an official capacity as a director,
officer, member, employee or agent, he shall be indemnified and held harmless
by the Company to the fullest extent permitted by Nevada law and the Company’s
by-laws, as the same exist or may hereafter be amended (but, in the case of any
such amendment to the Company’s by-laws, only to the extent such amendment
permits the Company to provide broader indemnification rights than the
Company’s by-laws permitted the Company to provide before such amendment),
against all expense, liability and loss (including, without limitation,
attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts
paid or to be paid in settlement) reasonably incurred or suffered by the
Executive in connection therewith.

 

10.2                           Procedure.  The indemnification provided pursuant to
this Section 10 shall be subject to the following conditions:

 

(a)                                  The
Executive must promptly give the Company written notice of any actual or
threatened Indemnifiable Action and, upon providing such notice, the Executive
shall be presumed to be entitled to indemnification under this Agreement and
the Company shall have the burden of proof to overcome that presumption in
reaching any contrary determination; provided, however, that the
Executive’s failure to give such notice shall not affect the Company’s
obligations hereunder;

 

(b)                                 The
Company will be permitted, at its option, to participate in, or to assume, the
defense of any Indemnifiable Action, with counsel reasonably approved by the
Executive; provided, however, that (i) the Executive shall have
the right to employ his own counsel in such Indemnifiable Action at the
Executive’s expense; and (ii) if (A) the retention of counsel by the Executive
has been previously authorized in writing by the Company, (B) the Executive
shall have concluded, based on the advice of his legal counsel, that there may
be a conflict of interest between the Company and the Executive in the conduct
of any such defense, or (C) the Company shall not, in fact, have retained
counsel to assume the defense of such Indemnifiable Action, the fees and
expenses of the Executive’s counsel shall be at the expense of the Company; and
provided, further, that the Company shall not settle any action
or claim that would impose any limitation or penalty on the Executive without
obtaining the Executive’s prior written consent, which consent shall not be
unreasonably withheld;

 

(c)                                  The
Executive must provide reasonable cooperation to the Company in the defense of
any Indemnifiable Action; and

 

15

 

(d)                                 The
Executive must refrain from settling any Indemnifiable Action without obtaining
the Company’s prior written consent, which consent shall not be unreasonably
withheld.

 

10.3                           Advancement
of Costs and Expenses. 
The Company agrees to advance all costs and expenses referred to in Subsections
10.1 and 10.6; provided, however, that the Executive
agrees to repay to the Company all amounts so advanced only if, and to the
extent that, it shall ultimately be determined by a court of competent
jurisdiction that the Executive is not entitled to be indemnified by the
Company as authorized by this Agreement. 
The advances to be made
hereunder shall be paid by the Company to or on behalf of the Executive within
twenty (20) days following delivery of a written request therefor by the
Executive to the Company.  The
Executive’s entitlement to advancement of costs and expenses hereunder shall
include those incurred in connection with any action, suit or proceeding by the
Executive seeking a determination, adjudication or arbitration in award with
respect to his rights and/or obligations under this Section 10.

 

10.4                           Non-Exclusivity
of Rights.  The right to
indemnification and the payment of expenses incurred in defending an
Indemnifiable Action in advance of its final disposition conferred in this Section 10
shall not be exclusive of any other right which the Executive may have or
hereafter may acquire under any statute, provision of the certificate of
incorporation or by-laws of the Company, agreement, vote of stockholders or
disinterested directors or otherwise.

 

10.5                           D&O
Insurance.  The Company
will maintain a directors’ and officers’ liability insurance policy covering
the Executive that provides coverage that is reasonable in relation to the
Executive’s position during the Term of Employment.

 

10.6                           Witness
Expenses. 
Notwithstanding any other provision of this Agreement, the Company shall
indemnify the Executive if and whenever he is a witness or threatened to be
made a witness to any action, suit or proceeding to which the Executive is not
a party, by reason of the fact that the Executive is or was a director or
officer of the Company or its Affiliates or by reason of anything done or not
done by him in such capacity, against all expense, liability and loss incurred
or suffered by the Executive in connection therewith; provided, however,
that if the Executive is no longer employed by the Company, the Company will
compensate him, on an hourly basis, for all time spent, at either his then
current compensation rate or his Base Salary at the rate in effect as of the
termination of his employment, whichever is higher.

 

10.7                           Survival.  The
provisions of this Section 10 shall survive the expiration or earlier
termination of this Agreement, regardless of the reason for such termination.

 

11.                                 COVENANT NOT ENGAGE IN CERTAIN ACTS.

 

11.1                           General.  The Parties understand and agree that the
purpose of the restrictions contained in this Section 11 is to protect
the goodwill and other legitimate business interests of the Company, and that
the Company would not have entered into this Agreement in the absence of such
restrictions.  The Executive
acknowledges and agrees that the restrictions are

 

16

 

reasonable and do not, and will not, unduly impair his ability to make
a living after the termination of his employment with the Company.  The provisions of this Section 11
shall survive the expiration or sooner termination of this Agreement.

 

11.2                           Non-assistance;
Non-diversion.  In
consideration for this Agreement to employ the Executive and the other valuable
consideration provided hereunder, the Executive agrees and covenants that
during the Term of Employment and during the Restriction Period, and except
when acting on behalf of the Company or on behalf of any Affiliate, the
Executive shall not, directly or indirectly, for himself or any third party, or
alone or as a member of a partnership, or as an officer, director, shareholder
or otherwise, engage in the following acts:

 

(a)                                  divert
or attempt to divert any existing business of the Company or any Affiliate;

 

(b)                                 accept
any position or affiliation with, or render any services on behalf of, any
Competing Business; or

 

(c)                                  hire
or retain any employee of the Company or any Affiliate to provide services for
any other Person or induce, solicit, attempt to solicit, encourage, divert,
cause or attempt to cause any employee or prospective employee of the Company
or any Affiliate to (i) terminate and/or leave such employment, or (ii)
accept employment with anyone other than the Company or an Affiliate.

 

11.3                           Cessation/Reimbursement
of Payments.  If the
Executive violates any provision of this Section 11, the Company may,
upon giving written notice to the Executive, immediately cease all payments and
benefits that it may be providing to the Executive pursuant to Section 3,
Section 6 or Subsection 7.2, and the Executive may be required to
reimburse the Company for any payments received from, and the cash value of any
benefits provided by, the Company between the first day of the violation and
the date such notice is given; provided, however, that the
foregoing shall be in addition to such other remedies as may be available to
the Company and shall not be deemed to permit the Executive to forego or waive
such payments in order to avoid his obligations under this Section 11.

 

11.4                           Survival.  The Executive agrees that the provisions of
this Section 11 shall survive the termination of this Agreement and
the termination of the Executive’s employment.

 

12.                                 CONFIDENTIAL INFORMATION AND COMPANY PROPERTY.

 

12.1                           Confidential
Information.  The
Executive understands and acknowledges that Confidential Information
constitutes a valuable asset of the Company and its Affiliates and may not be
converted to the Executive’s own or any third party’s use.  Accordingly, the Executive hereby agrees
that he shall not directly or indirectly, during the Term of Employment or any
time thereafter, disclose any Confidential Information to any Person not
expressly authorized by the Company to receive such Confidential
Information.  The Executive further

 

17

 

agrees that he shall not directly or indirectly, during the Term of
Employment or any time thereafter, use or make use of any Confidential
Information in connection with any business activity other than that of the
Company.  The Parties acknowledge and
agree that this Agreement is not intended to, and does not, alter either the
Company’s rights or the Executive’s obligations under any state or federal
statutory or common law regarding trade secrets and unfair trade practices.

 

12.2                           Company
Property.  All Company
Property is and shall remain exclusively the property of the Company.  Unless authorized in writing to the
contrary, the Executive shall promptly, and without charge, deliver to the
Company on the termination of employment hereunder, or at any other time the
Company may so request, all Company Property that the Executive may then
possess or have under his control.

 

12.3                           Required
Disclosure.  In the event
the Executive is required by law or court order to disclose any Confidential
Information or to produce any Company Property, the Executive shall promptly
notify the Company of such requirement and provide the Company with a copy of
any court order or of any law which requires such disclosure and, if the
Company so elects, to the extent permitted by applicable law, give the Company
an adequate opportunity, at its own expense, to contest such law or court order
prior to any such required disclosure or production by the Executive.

 

12.4                           Survival.  The Executive agrees that the provisions of
this Section 12 shall survive the termination of this Agreement and
the termination of the Executive’s employment.

 

13.                                 MUTUAL ARBITRATION AGREEMENT.

 

13.1                           Arbitrable
Claims.  All disputes
between the Executive (and his attorneys, successors, and assigns) and the
Company (and its trustees, beneficiaries, officers, directors, managers,
affiliates, employees, agents, successors, attorneys, and assigns) relating in
any manner whatsoever to the employment or termination of the Executive,
including, without limitation, all disputes arising under this Agreement (“Arbitrable
Claims”), shall be resolved by binding arbitration as set forth in
this Section 13 (the “Mutual Arbitration Agreement”).  Arbitrable Claims shall include, but are not
limited to, claims for compensation, claims for breach of any contract or
covenant (express or implied), and tort claims of all kinds, as well as all
claims based on any federal, state, or local law, statute or regulation, but
shall not include Company’s right to seek injunctive relief as provided in Section
15.  Arbitration shall be final and
binding upon the Parties and shall be the exclusive remedy for all Arbitrable
Claims.  THE PARTIES HEREBY WAIVE ANY RIGHTS THEY
MAY HAVE TO TRIAL BY JUDGE OR JURY IN REGARD TO ARBITRABLE CLAIMS, EXCEPT AS
PROVIDED BY SECTION 13.4.

 

13.2                           Procedure.  Arbitration of Arbitrable Claims shall be in
accordance with the National Rules for the Resolution of Employment Disputes of
the American Arbitration Association, as amended, and as augmented in this
Agreement.  Either Party may bring an
action in court to compel arbitration under this Agreement and to enforce an
arbitration award.

 

18

 

Otherwise, neither Party shall initiate or prosecute any lawsuit,
appeal or administrative action in any way related to an Arbitrable Claim.  The initiating Party must file and serve an
arbitration claim within sixty (60) days of learning the facts giving rise to
the alleged claim.  All arbitration
hearings under this Agreement shall be conducted in Las Vegas, Nevada.  The Federal Arbitration Act shall govern the
interpretation and enforcement of this Agreement.  The fees of the arbitrator shall be divided equally between both
Parties.

 

13.3                           Confidentiality.  All proceedings and all documents prepared
in connection with any Arbitrable Claim shall be confidential and, unless
otherwise required by law, the subject matter and content thereof shall not be
disclosed to any Person other than the parties to the proceedings, their
counsel, witnesses and experts, the arbitrator and, if involved, the court and
court staff.

 

13.4                           Applicability.  This Section 13 shall apply to all
disputes under this Agreement other than disputes relating to the enforcement
of the Company’s rights under Sections 11 and 12 of this Agreement.

 

13.5                           Acknowledgements.  The Executive acknowledges that he:

 

(a)                                  has
carefully read this Section 13;

 

(b)                                 understands
its terms and conditions; and

 

(c)                                  has
entered into this Mutual Arbitration Agreement voluntarily and not in reliance
on any promises or representations made by the Company other than those
contained in this Mutual Arbitration Agreement.

 

14.                                 NOTICES.  All
notices, demands and requests required or permitted to be given to either Party
under this Agreement shall be in writing and shall be deemed to have been given
when delivered personally or sent by certified or registered mail, postage
prepaid, return receipt requested, duly addressed to the Party concerned at the
address indicated below or to such changed address as such Party may
subsequently give notice of:

 

	
  If to the Company:

  	
  Station Casinos, Inc.

  
	
   

  	
  2411 West Sahara Avenue

  
	
   

  	
  Las Vegas, NV  89102

  
	
   

  	
  Attn:  Scott M. Nielson

  
	
   

  	
   

  
	
  With a copy to:

  	
  Milbank, Tweed, Hadley
  & McCloy

  
	
   

  	
  601 South Figueroa
  Street, 30th Floor

  
	
   

  	
  Los Angeles, CA  90017

  
	
   

  	
  Attn:  Kenneth J. Baronsky

  
	
   

  	
   

  
	
  If to the Executive:

  	
  Glenn C. Christenson

  
	
   

  	
  2346 Villandry Court

  
	
   

  	
  Henderson, NV  89014

  

 

19

 

15.                                 RIGHT TO SEEK INJUNCTIVE RELIEF.  The Executive acknowledges that a violation
on his part of any of the covenants contained in Sections 11 and 12
would cause immeasurable and irreparable damage to the Company.  The Executive accordingly agrees and hereby
grants his consent that, without limiting the remedies available to the
Company, any actual or threatened violation of such covenants may be enforced
by injunctive relief or by other equitable remedies issued or ordered by any
court of competent jurisdiction.

 

16.                                 EMPLOYEE BENEFIT PLAN DOCUMENTS.  In the event that any terms and provisions
of this Agreement conflict with the terms and provisions of any employee
benefit plan document, the terms and provisions of this Agreement shall govern,
and the Company shall take any and all actions that may be necessary, including
amendment of any plan document, to effect the provision of benefits expressly
provided upon termination of the Executive’s employment pursuant to Sections 6
and 7.

 

17.                                 BENEFICIARIES/REFERENCES.  The
Executive shall be entitled to select a beneficiary or beneficiaries to receive
any compensation or benefit payable hereunder following the Executive’s death,
and may change such election, by giving the Company written notice
thereof.  In the event of the
Executive’s death or a judicial determination of his incompetence, reference in
this Agreement to the Executive shall be deemed, where appropriate, to refer to
his beneficiaries, estate or other legal representative.

 

18.                                 SURVIVORSHIP.  The
respective rights and obligations of the Parties hereunder shall survive the
expiration or earlier termination of this Agreement to the extent necessary to
the intended preservation of such rights and obligations.  The provisions of this Section 18 are
in addition to the survivorship provisions of any other section of this
Agreement.

 

19.                                 REPRESENTATIONS AND WARRANTIES.  Each Party represents and warrants that he
or it is fully authorized and empowered to enter into this Agreement and that
the performance of his or its obligations under this Agreement will not violate
any Agreement between that Party and any other Person.

 

20.                                 ENTIRE AGREEMENT.  This Agreement contains the entire agreement
between the Parties concerning the subject matter hereof and supersedes all
prior agreements, understandings, discussions, negotiations and undertakings,
whether written or oral, express or implied, between the Parties with respect
hereto.  No representations,
inducements, promises or agreements not embodied herein shall be of any force
or effect.

 

21.                                 ASSIGNABILITY; BINDING NATURE.  This Agreement shall be binding upon and
inure to the benefit of the Parties and their respective successors, heirs and
assigns; provided, however, that no rights or obligations of the
Executive under this Agreement may be assigned or transferred by the Executive,
other than rights to compensation and benefits hereunder, which may be
transferred only by will or operation of law and subject to the limitations of
this Agreement; and provided, further, that no rights or
obligations of the Company under this Agreement may be assigned or transferred
by the Company, except that such rights or obligations may be assigned or
transferred pursuant to a merger or consolidation in which the Company is not
the continuing entity, or the sale or liquidation of all or substantially all
of the assets of the Company, provided that the assignee or transferee is the
successor to all or 

 

20

 

substantially all of the assets of the Company and such assignee or
transferee assumes the liabilities, obligations and duties of the Company under
this Agreement, either contractually or as a matter of law.

 

22.                                 AMENDMENT OR WAIVER.  No
provision in this Agreement may be amended or waived unless such amendment or
waiver is agreed to in writing, signed by both Parties.  No waiver by one Party of any breach by the
other Party of any condition or provision of this Agreement to be performed by
such other Party shall be deemed a waiver of a similar or dissimilar condition
or provision at the same or any prior or subsequent time.  No failure of the Company to exercise any
power given it hereunder or to insist upon strict compliance by the Executive
with any obligation hereunder, and no custom or practice at variance with the
terms hereof, shall constitute a waiver of the right of the Company to demand
strict compliance with the terms hereof.

 

23.                                 SEVERABILITY.  In the event
that any provision or portion of this Agreement shall be determined to be
invalid or unenforceable for any reason, in whole or in part, the remaining
provisions of this Agreement shall be unaffected thereby and shall remain in
full force and effect to the fullest extent permitted by law.

 

24.                                 GOVERNING LAW.  This
Agreement shall be governed by and construed and interpreted in accordance with
the laws of the State of Nevada without reference to the principles of conflict
of laws thereof.  In the event of any
dispute or controversy arising out of or relating to this Agreement that is not
an arbitrable claim, the Parties mutually and irrevocably consent to, and waive
any objection to, the exclusive jurisdiction of any court of competent
jurisdiction in Clark County, Nevada, to resolve such dispute or controversy.

 

25.                                 HEADINGS.  The
headings of the sections and subsections contained in this agreement are for
convenience only and shall not be deemed to control or affect the meaning or
construction of any provision of this Agreement.

 

26.                                 COUNTERPARTS.  This
Agreement may be executed in counterparts, each of which shall be deemed an
original and all of which shall constitute one and the same Agreement with the
same effect as if all Parties had signed the same signature page.  Any signature page of this Agreement may be
detached from any counterpart of this Agreement and reattached to any other
counterpart of this Agreement identical in form hereto but having attached to it
one or more additional signature pages.

 

27.                                 ACKNOWLEDGEMENT.  The
Executive represents and acknowledges the following: 

 

(a)                                  he
has carefully read this Agreement in its entirety;

 

(b)                                 he
understands the terms and conditions contained herein;

 

21

 

(c)                                  he
has had the opportunity to review this Agreement with legal counsel of his own
choosing and has not relied on any statements made by the Company or its legal
counsel as to the meaning of any term or condition contained herein or in
deciding whether to enter into this Agreement; and

 

(d)                                 he
is entering into this Agreement knowingly and voluntarily.

 

IN WITNESS WHEREOF,
the undersigned have executed this Agreement as of the date first written
above.

 

	
   

  	
  STATION CASINOS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  GLENN
  C. CHRISTENSON

  
					

 

22

 

EXHIBIT “A”

 

GENERAL RELEASE
AND COVENANT NOT TO SUE

 

This
GENERAL
RELEASE AND COVENANT NOT TO SUE (this “Release”) is executed and
delivered by GLENN C. CHRISTENSON (the “Executive”) to STATION CASINOS, INC., a
Nevada corporation (the “Company”).

 

In
consideration of the agreement by the Company to provide the separation
payments and benefits in Section 6 and Section 7 of the
Employment Agreement between the Executive and the Company, dated as of May 20,
2003 (the “Employment Agreement”), and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
Executive hereby agrees as follows:

 

1.                                      RELEASE AND COVENANT.  THE EXECUTIVE, OF HIS
OWN FREE WILL, VOLUNTARILY RELEASES AND FOREVER DISCHARGES THE COMPANY AND ITS
SUBSIDIARIES AND AFFILIATES, AND EACH OF THEIR RESPECTIVE PAST AND PRESENT
AGENTS, EMPLOYEES, MANAGERS, REPRESENTATIVES, OFFICERS, DIRECTORS, ATTORNEYS,
ACCOUNTANTS, TRUSTEES, SHAREHOLDERS, PARTNERS, INSURERS, HEIRS,
PREDECESSORS-IN-INTEREST, ADVISORS, SUCCESSORS AND ASSIGNS (COLLECTIVELY, THE
“RELEASED PARTIES”) FROM, AND COVENANTS NOT TO SUE OR PROCEED AGAINST ANY OF
THE FOREGOING ON THE BASIS OF, ANY AND ALL PAST OR PRESENT CAUSES OF ACTION,
SUITS, AGREEMENTS OR OTHER RIGHTS OR CLAIMS WHICH THE EXECUTIVE, HIS
DEPENDENTS, RELATIVES, HEIRS, EXECUTORS, ADMINISTRATORS, SUCCESSORS AND ASSIGNS
HAS OR HAVE AGAINST ANY OF THE RELEASED PARTIES UPON OR BY REASON OF ANY MATTER
ARISING OUT OF HIS EMPLOYMENT BY THE COMPANY AND THE CESSATION OF SAID
EMPLOYMENT, AND INCLUDING, BUT NOT LIMITED TO, ANY ALLEGED VIOLATION OF THE
CIVIL RIGHTS ACTS OF 1964 AND 1991, THE EQUAL PAY ACT OF 1963, THE AGE
DISCRIMINATION IN EMPLOYMENT ACT OF 1967 (INCLUDING THE OLDER WORKERS BENEFIT
PROTECTION ACT OF 1990), THE REHABILITATION ACT OF 1973, THE FAMILY AND MEDICAL
LEAVE ACT OF 1993, THE AMERICANS WITH DISABILITIES ACT OF 1990, THE EMPLOYMENT
RETIREMENT INCOME SECURITY ACT OF 1974, THE NEVADA FAIR EMPLOYMENT PRACTICES
ACT, THE MISSOURI HUMAN RIGHTS ACT, THE LABOR LAWS OF THE UNITED STATES, NEVADA
AND MISSOURI, AND ANY OTHER FEDERAL, STATE OR LOCAL LAW, REGULATION OR
ORDINANCE, OR PUBLIC POLICY, CONTRACT OR TORT LAW, HAVING ANY BEARING WHATSOEVER
ON THE TERMS AND CONDITIONS OR CESSATION OF HIS EMPLOYMENT WITH THE COMPANY.

 

 

2.                                       DUE CARE.  THE
EXECUTIVE ACKNOWLEDGES THAT HE HAS RECEIVED A COPY OF THIS RELEASE PRIOR TO ITS
EXECUTION AND HAS BEEN ADVISED HEREBY OF HIS OPPORTUNITY TO REVIEW AND CONSIDER
THIS RELEASE FOR TWENTY-ONE (21) DAYS PRIOR TO ITS EXECUTION.  THE EXECUTIVE FURTHER ACKNOWLEDGES THAT HE
HAS BEEN ADVISED HEREBY TO CONSULT WITH AN ATTORNEY PRIOR TO EXECUTING THIS
RELEASE.  THE EXECUTIVE ENTERS INTO THIS
RELEASE HAVING FREELY AND KNOWINGLY ELECTED, AFTER DUE CONSIDERATION, TO
EXECUTE THIS RELEASE AND TO FULFILL THE PROMISES SET FORTH HEREIN.  THIS RELEASE SHALL BE REVOCABLE BY THE
EXECUTIVE DURING THE SEVEN (7) DAY PERIOD FOLLOWING ITS EXECUTION, AND SHALL
NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE EXPIRATION OF SUCH SEVEN (7) DAY
PERIOD.  IN THE EVENT OF SUCH A
REVOCATION, THE EXECUTIVE SHALL NOT BE ENTITLED TO THE CONSIDERATION FOR THIS
RELEASE SET FORTH ABOVE.

 

3.                                       RELIANCE BY THE EXECUTIVE. 
THE EXECUTIVE ACKNOWLEDGES THAT, IN HIS DECISION TO ENTER INTO THIS
RELEASE, HE HAS NOT RELIED ON ANY REPRESENTATIONS, PROMISES OR ARRANGEMENT OF
ANY KIND, INCLUDING ORAL STATEMENTS BY REPRESENTATIVES OF THE COMPANY, EXCEPT
AS SET FORTH IN THIS RELEASE.

 

4.                                       MISCELLANEOUS.  THE
EXECUTIVE SHALL NOT DISCLOSE THE EXISTENCE OR CONTENTS OF THIS RELEASE TO
ANYONE OTHER THAN HIS IMMEDIATE FAMILY, ACCOUNTANTS OR ATTORNEYS, AND THE
EXECUTIVE SHALL INSTRUCT SUCH THIRD PARTIES NOT TO DISCLOSE THE SAME.  THIS RELEASE SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEVADA
WITHOUT REFERENCE TO THE PRINCIPLES OF CONFLICT OF LAWS THEREOF.  IF ANY PROVISION OF THIS RELEASE IS HELD
INVALID OR UNENFORCEABLE FOR ANY REASON, THE REMAINING PROVISIONS SHALL BE
CONSTRUED AS IF THE INVALID OR UNENFORCEABLE PROVISION HAD NOT BEEN INCLUDED.

 

ii

 

This
GENERAL RELEASE AND COVENANT NOT TO SUE is executed by the Executive and
delivered to the Company on
                                           .

 

“Executive”

 

	
   

  	
   

  
	
  GLENN
  C. CHRISTENSON

  
	
   

  
	
   

  
	
  STATE OF
                           

  	
  )

  
	
   

  	
  ) ss:

  
	
  COUNTY OF
                             

  	
  )

  

 

On this
               
day of
                              ,
         , before me, a Notary
Public of the State of
                         ,
personally appeared
                       ,
to me known and known to me to be the person described and who executed the
foregoing release and did then and there acknowledge to me that he voluntarily
executed the same.

 

	
   

  	
   

  
	
  NOTARY PUBLIC

  

 

[Not to be signed or notarized upon
execution of Employment Agreement]

 

iii

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00055-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00055-of-00352.parquet"}]]