Document:

EXHIBIT 10.2

 

AMENDED & RESTATED

 

EMPLOYMENT AND NON-COMPETE AGREEMENT

 

DOVER DOWNS GAMING & ENTERTAINMENT, INC.

 

AND

 

EDWARD J. SUTOR

 

THIS AGREEMENT, is by and
between Dover Downs Gaming & Entertainment, Inc. (the “Company”)
and Edward J. Sutor (the “Executive”), is effective as of this 13th day of February 2006
(the “Effective Date”), and amends and restates the Employment and Non-Compete
Agreement between the parties dated June 16, 2004 (the “Prior Agreement”).

 

W I T N E S S E T H:

 

WHEREAS, the Executive is
currently employed by the Company or an affiliate thereof in an executive
position; and

 

WHEREAS, the Executive
has, in the course of his employment, developed relationships with employees
and customers of the Company, and learned valuable and sensitive information
concerning the Company’s operations, policies and procedures; and

 

WHEREAS, the Executive
has, in the course of his employment, been exposed to valuable and sensitive
Company reports, files, memoranda, records, software, and other property; and

 

WHEREAS, the Company
recognizes that the solicitation of its employees and customers, and the use or
disclosure of the policies, procedures, information, documents, and property of
the Company would be damaging to the Company’s interests; and

 

WHEREAS, the Company has
determined that it is in the best interests of the Company to protect its
interests through the use of Employment and Non-Compete Agreements; and

 

WHEREAS, the Company has
determined that it is in the best interests of the Company and its shareholders
for the Company to agree to provide benefits under the circumstances described
below to the Executive and other executives who agree to such an agreement.

 

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

 

 

Section 1

Definitions

 

“Announcement” shall mean
a press release issued by the Company announcing the signing of an agreement
whereby the Company will be acquired by or merge with any other entity or a
tender offer for the shares of the Company stock will be initiated.

 

“Board” shall mean the
Board of Directors of the Company or the ultimate corporate parent entity which
owns the Company if the Company is not public.

 

“Cause” shall mean a
unanimous determination by the Board that the Executive has been convicted of a
felony, has embezzled from, or committed fraud against, the Company which
embezzlement or fraud has a material adverse financial impact on the Company or
gross insubordination which has continued after written notice of such from the
Board which determination is upheld by a final, non-appealable arbitration
award pursuant to Section 6.

 

“Change in Control” shall
mean the earlier to occur of (a) ten (10) days following the closing
of a tender offer for the Company’s stock following the Announcement or (b) the
closing of a merger or similar transaction (“Transaction”) of the Company and
any other entity; provided, however, a Transaction the result of which is the
shareholders of the Company’s voting securities immediately prior to the
Transaction own, directly or indirectly in substantially the same proportion,
at least 60% of the voting securities of the survivor of such Transaction
immediately following such Transaction shall not be a Change in Control.

 

“Change in Control Fee”
shall mean $250, 000.

 

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

 

“Company Information”
shall mean (i) confidential information including, without limitation,
information received from third parties under confidential conditions, (ii) information
subject to the Company’s and its affiliates’ attorney-client or work-product
privilege; and (iii) other technical, business, legal or financial
information (including, without limitation, customer lists), the use or
disclosure of which might reasonably be construed to be contrary to the Company’s
and its affiliates’ interests.

 

“Date of Termination”
shall mean the date on which the Executive’s employment is terminated.

 

“Employment Period” shall
mean the period of time during the Extension Period the Executive is an
employee of the Company.

 

“Extension Period” shall
mean the 24 month period following the Change in Control.

 

 “Good Reason” shall mean a (i) reduction
in title, responsibilities, administrative support or support services, (ii) relocation
of Executive’s office, (iii) travel at a level that exceeds the travel
requirements before the Change in Control, (iv) any breach by the Company
of its obligations hereunder, (v) any breach by the purchaser under a merger
or acquisition agreement pursuant to which the Change in Control takes place
relating to employee benefits or directors’

 

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and officers’
insurance or indemnification provisions, or (vi) any reason whatsoever two
months after the Change in Control.

 

“Monthly
Amount” shall be an amount equal to one-twelfth of the sum of (a) the
Executive’s then current annual base salary (excluding any incentive or bonus),
and (b) the amount of any cash bonus awarded to the Executive for the then
most recently concluded fiscal year of the Company,
provided that for purposes of this calculation only, the cash bonus shall be
deemed to be (1) not less than 75% of the average cash bonus awarded to
the Executive for the then most recently concluded fiscal year of the Company
and the preceding two fiscal years, and (2) not greater than 125% of the
average cash bonus awarded to the Executive for the then most recently
concluded fiscal year of the Company and the preceding two fiscal years.

 

“Non-Compete
Monthly Amount” shall mean the portion of the Monthly Amount which is paid in
consideration of the Executive’s agreement to the restrictions and other
provisions of Section 7, with the remainder of the Monthly Amount and
other benefits under this Agreement paid after the Employment Period to be
treated as severance.  Executive’s
Non-Compete Monthly Amount shall be calculated by multiplying the Monthly
Amount by fifty percent.

 

“Retirement Plan” shall
mean the Company’s qualified defined benefit retirement plan(s) in which the
Executive participates.

 

“SERP” shall mean any and
all supplemental retirement plans in which the Executive participates
(including, but not limited to, any benefit restoration plan(s) maintained by
the Company from time to time).

 

Section 2

Term
of Agreement

 

This
Agreement shall be effective as of the Effective Date and shall automatically
terminate if the Executive’s employment is terminated.  Renewal of this Agreement shall
automatically occur for successive two (2) year terms, provided that at
any time prior to any such renewal, the Company’s Compensation and Stock
Incentive Committee shall have the discretion to terminate this automatic
renewal provision.

 

Section 3

Benefits

 

(a)          On the date of a Change
in Control, the Company shall pay to the Executive in cash the Change in
Control Fee.

 

(b)         During the Extension
Period, the Company shall pay to the Executive the Monthly Amount, payable on
the first day of each month, prorated for partial months.

 

(c)          If the Executive’s
employment is terminated during the Extension Period, then,

 

(i)                                     within
five business days after the Date of Termination, the Company shall pay to the
Executive (or if the Executive dies, to the estate of the Executive) in cash
all accrued but unpaid salary, earned but unpaid bonuses, and accrued but
unused vacation in accordance with Company policies;

 

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(ii)                                  the
Company shall pay to the Executive (or if the Executive dies, to the estate of
the Executive) the Monthly Amount on the first day of each month during the
remainder of the Extension Period;

 

(iii)                               the
Company shall pay to the Executive (or if the Executive dies, to his
beneficiary, if any, under the Retirement Plan) a lump sum amount equal to the
value of the monthly benefit under (x) the Retirement Plan and (y) the SERP,
that the Executive or his beneficiary, if any, under the Retirement Plan would
have received (1) for payments of the Monthly Amount had Executive been an
employee while receiving such payments, and (2) for payment of the Change
of Control Fee had such amount been treated as a normal bonus for pension
accrual purposes (giving credit for all purposes, including, but not limited
to, accrual of benefits, vesting, age and years of service and making the
determination without regard to compensation or benefit limitations prescribed
by federal law or regulation), which payment shall be paid within 10 days of
the Date of Termination and calculated by Buck Consultants (or such other
consultant as may be agreed upon) using the actuarial assumptions under the
Retirement Plan and the discount rate which would be utilized for purposes of
funding a Plan termination;

 

(iv)                              on
the Date of Termination the Company shall transfer title and ownership to the
Executive of his laptop computer, if any, without any payment by the Executive
to the Company.

 

(d)         During the Extension
Period (whether or not during the Employment Period) the Executive shall be
entitled to the following additional benefits:

 

(i)                                     The
Executive and, as applicable, the Executive’s covered dependents shall be
entitled to all health, welfare, and fringe benefits provided by the Company to
its key employees generally or to the Executive on an individual or group basis
(including, but not limited to, any life, accident, health, hospitalization or
long-term disability insurance, maintained from time to time by the Company),
whether maintained pursuant to a plan, policy or other arrangement (written or
unwritten), as if the Executive were still employed during such period, at the
same level of benefits and at the same dollar cost to the Executive as is
available generally to comparable employees of the Company (but in no instances
shall such benefits be at a level less than as in effect on the date of the
Change in Control).  If the Company
reasonably determines that the coverage required under this Section would
cause a welfare plan sponsored by the Company to violate any provision of the
Code prohibiting discrimination in favor of highly compensated employees or key
employees, or if any benefits described in this Section cannot be provided
(or the Company determines that it does not wish to provide such benefits)
pursuant to the appropriate plan or program maintained for employees of the
Company, the Company shall provide such benefits outside such plan or program
at no additional cost (on an after tax basis) to the Executive or, if the
parties shall so agree, the Company will pay to the Executive the cash
equivalent thereof.  The health benefits
provided in accordance with this Section shall be secondary to any
comparable benefits provided by another employer if and only if the Executive
chooses to be covered by such other employee plan.

 

(ii)                                  Executive
shall receive continued payment of professional and organizational dues and
fees as in effect prior the Change in Control.

 

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(e)          (i)  If all, or any
portion, of the payments and benefits provided under this Agreement, if any,
either alone or together with other payments and benefits which the Executive
receives or is entitled to receive from the Company, would constitute an excess
“parachute payment” within the meaning of Section 280G of the Code
(whether or not under an existing plan, arrangement, or other agreement) (each
such parachute payment, a “Parachute Payment”), and would result in the
imposition on the Executive of an excise tax under Section 4999 of the
Code, then, in addition to any other benefits to which the Executive is entitled
under this Agreement or otherwise, the Executive shall be paid an amount in
cash equal to the sum of the excise taxes payable by the Executive by reason of
receiving Parachute Payments plus the amount necessary to place the Executive
in the same after-tax position (taking into account any and all applicable
federal, state and local excise, income or other taxes at the highest possible
applicable rates on such Parachute Payments (including, without limitation, any
payments under this Section) as if no excise taxes had been imposed with
respect to Parachute Payments (the “Parachute Gross-Up”).  Any Parachute Gross-Up otherwise required by
this Section shall not be made later than the time of the corresponding
payment or benefit hereunder giving rise to the underlying Section 4999
excise tax, even if the payment of the excise tax is not required under the
Code until a later time.

 

(ii)                                  Subject
to the provisions of Section 3(d) and except as may otherwise be
agreed to by the Company and the Executive, the amount or amounts (if any)
payable under this Section 3 shall be as conclusively determined by the
KPMG LLP, or such other firm as mutually agreed to by the Company and the
Executive (“Independent Tax Counsel”), whose determination or determinations
shall be final and binding on all parties. 
The Executive shall agree to utilize such determination or
determinations, as applicable, in filing all of the Executive’s tax returns
with respect to the excise tax imposed by Section 4999 of the Code, if
any.  If such Independent Tax Counsel
fails or refuses to make the required determinations for any reason, then such
determinations shall be made by a comparable firm or group of national
reputation to which the parties reasonably mutually agreed.  All fees and expenses of the Independent Tax
Counsel or its replacement shall be paid by the Company.

 

(iii)                               As
a result of the uncertainty in the application of Section 4999 of the Code
at the time of the initial determination by the Independent Tax Counsel
hereunder, it is possible that Parachute Gross-Up payments, if any, which will
not have been made by the Company, should have been made, together with any
interest, penalties or taxes of any kind thereon, consistent with the
calculations required to be made hereunder (an “Underpayment”).  The Company shall pay all such Underpayments
to or for the benefit of the Executive. 
The Executive shall notify the Company in writing of any claim by the
Internal Revenue Service that, if successful, would require the payment by the
Company of the Gross-Up Payment within ten (10) business days after the
Executive is informed in writing of such claim. 
The Company shall notify the Executive within ten (10) business
days of receipt of the Executive notice that the Company (x) will pay the Underpayment
and do so on or before the date due, or (y) that it desires to contest such
claim.  The Executive will cooperate with
the Company in any such contest; provided, however, that the Company shall bear
and pay directly all costs and expenses (including additional interest and
penalties) incurred in connection with such contest and shall indemnify and
hold the Executive harmless, on an after-tax basis, for any Excise Tax or
income tax (including interest and penalties with respect thereto) imposed as a
result of such representation and payment of costs and expenses.  Furthermore, the Company’s control of the

 

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contest shall be limited
to issues with respect to which a Gross-Up Payment would be payable hereunder
and the Executive shall be entitled, at Executive’s expense, to settle or
contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority.

 

(iv)                              References
herein to Code sections shall apply to comparable Code sections in the event of
any amendment to the Code.

 

(v)                                 The
foregoing provisions of this subsection (f) shall similarly apply to
any benefit provided elsewhere in this Agreement where it is expressly provided
that the benefit is to be provided on an after tax basis.

 

(f)            In the event of the
Executive’s termination of employment under this Agreement, the Executive shall
be under no obligation to seek other employment, and there shall be no offset
against amounts due the Executive under this Agreement on account of any
remuneration attributable to any subsequent employment.

 

In the
event that Executive’s employment is terminated by the Company for Cause (and
Executive was not capable of voluntarily terminating for Good Reason at or
prior to such time) or if Executive voluntarily terminates without Good Reason,
the Company shall remain obligated to pay the Non-Compete Monthly Amount but
shall not be obligated to pay the balance of the Monthly Amount.  Executive is free to terminate his employment
for Good Reason.

 

Section 4

Employment

 

Following a Change in
Control, the Executive will, except as provided below, continue as an employee
during the Extension Period.  During the
Employment Period:

 

(i)                                     The
Executive shall perform services consistent with his past practices,

 

(ii)                                  The
Executive shall not be required to relocate or travel in excess of past
practices,

 

(iii)                               The
Executive shall enjoy the same office, administrative support and support
services as he enjoyed prior to the Change in Control.

 

(iv)                              The
Executive shall not be required to devote more time to Company business than he
did prior to the Change in Control and may continue director or officer
positions with other private or public entities that do not violate Section 7.

 

(v)                                 The
Executive’s expenses shall be reimbursed consistent with past practices, and

 

(vi)                              The
Executive shall receive at least the same vacation as he currently enjoys, but
not less than four weeks paid vacation.

 

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No breach or alleged
breach of this Section 4 shall constitute grounds for, or otherwise
entitle, the Company to offset payments otherwise owing to the Executive under
this Agreement.

 

Section 5

Source
of Payments

 

All payments provided for
in this Agreement shall be paid in cash from the general funds of the Company;
provided, however, that such payments shall be reduced by the amount of any
payments made to the Executive or his dependents, beneficiaries or estate from
any trust or special or separate fund established by the Company to assure such
payments.  The Company shall not be
required to establish a special or separate fund or other segregation of assets
to assure such payments.

 

Section 6

Litigation
Expenses and Arbitration

 

In addition to the
Company’s other obligations under this Agreement, the Company shall pay all
legal fees and expenses incurred in a legal proceeding (including arbitration)
by the Executive in seeking to obtain or enforce any right or benefit provided
by this Agreement (including, without limitation, any rights to a tax
gross-up).  Such payments are to be made
within five days after the Executive’s request for payment accompanied with
such evidence of fees and expenses incurred as the Company reasonably may
require; provided, however, that if the Executive institutes a proceeding and
the judge or other decision-maker presiding over the proceeding affirmatively
finds that the Executive has failed to prevail substantially, he shall pay his
own costs and expenses (and, if applicable, return any amounts theretofore paid
on his behalf under this Section 6.

 

All disputes with respect
to the subject matter of this Agreement and the enforcement of rights hereunder
shall be submitted to binding arbitration in accordance with the rules of
the American Arbitration Association (the “AAA”).  Each party hereto shall designate one
arbitrator (who need not be impartial) within fifteen (15) days after notice of
the dispute. The two arbitrators so designated shall endeavor to designate
promptly a third, neutral arbitrator. If the two arbitrators have not
designated the third arbitrator by the fifteenth (15th) day
following the designation of the second arbitrator, or if a second arbitrator
has not been designated by the (15th) day following the designation
of the first, either Party may request the AAA to designate the remaining
arbitrator(s). The third arbitrator shall take an oath of neutrality. The
arbitrators shall not be bound by judicial formalities and may abstain from
following the strict rules of evidence and shall interpret this Agreement
as an honorable engagement and not merely as a legal obligation. The
arbitrators shall have the power to render equitable relief as may be available
in accordance with applicable law. 
Unless otherwise agreed by the parties, any such arbitration shall take
place in such City within the United States as Executive may designate, and
shall be conducted in accordance with the Rules of the AAA.  The determination reached in such arbitration
shall be final and binding on both parties without any right of appeal or
further dispute. The arbitrators’ award may be confirmed in, and judgment upon
the award entered by, any federal or state court having jurisdiction over the
parties.

 

7

 

Section 7

Restrictive
Covenants

 

(a)          Within a reasonable
period of time following his termination of employment, the Executive shall
return to the Company all Company Information, reports, files, memoranda,
records, credit cards, cardkey passes, door and file keys, computer access
codes, and other property which the Executive has received, prepared, or helped
to prepare in connection with his employment with the Company, except as
provided in Section 3.  The
Executive acknowledges that in the course of employment with the Company, he
has acquired Company Information and that such Company Information has been
disclosed to him in confidence and for the Company’s use only.  The Executive agrees that, during the
Extension Period, he (i) will keep such Company Information confidential
at all times, (ii) will not disclose or communicate Company Information to
any third party, and (iii) will not make use of Company Information on his
own behalf or on behalf of any third party. 
The Executive further acknowledges and agrees that the Company’s remedy
in the form of monetary damages for any breach by him of any of the provisions
of this Section may be inadequate and that, in addition to any monetary
damages for such breach, the Company shall be entitled to institute and
maintain any appropriate proceeding or proceedings, including an action for
specific performance and/or injunction.

 

(b)         Executive agrees not to,
during the Extension Period, within the Territory, directly or indirectly,
individually or on behalf of persons not now parties to this Agreement, or as a
director, officer, principal, agent, executive, or in any other capacity or
relationship, engage in the casino business (except as a passive investor
holding not more than 3% of the equity of such business), or aid or endeavor to
assist any business or legal entity, that is in the casino business and that
competes with the Company anywhere in the Territory.  The Territory shall consist of both the
entire State of Delaware and a 50-mile radius around the Company’s facility in
Dover, Delaware.  The Company and
Executive acknowledge the reasonableness of this covenant not to compete and
the reasonableness of the geographic area and duration of time which are a part
of said covenant.

 

(c)          Unless waived in writing
by the Company, Executive further agrees that he will not, directly or
indirectly, during the Extension Period, solicit the trade or patronage of any
of the customers of the Company, regardless of the location of such customers
of the Company with respect to any services, products, or other matters in
which the Company is active.

 

(d)         Unless waived in writing
by the Company, Executive further agrees that he will not, directly or
indirectly, during the Extension Period, solicit or attempt to entice away from
the Company any director, agent or employee of the Company.

 

(e)          Executive acknowledges
that the Company has no adequate remedy at law and would be irreparably harmed
if Executive breaches or threatens to breach any of the provisions of this Section and,
therefore, agrees that the Company shall be entitled to injunctive relief to
prevent any such breach or threatened breach thereof and to specific
performance of the terms of this Section  (in addition to any other legal
or equitable remedy the Company may have, including if so determined by
arbitration, that the Company is not obligated to pay to the Executive (or the
Executive is required to repay to the Company) a portion or all of the
Non-Compete Monthly Amount; provided, however, in all instances the Company
shall continue to pay to Executive the

 

8

 

Non-Compete Monthly
Amount unless and until all appeals have been exhausted or the time for such
has expired).  Executive further agrees
that Executive shall not, in any equity proceeding relating to the enforcement
of this Section, raise the defense that the Company has an adequate remedy at
law.  Nothing in this Agreement shall be
construed as prohibiting the Company from pursuing any other remedies at law or
in equity that it may have under and in respect of this Agreement or any other
agreement.

 

(f)            The Executive agrees
to pay to the Company any outstanding amounts owed to the Company; provided,
however, that no breach or alleged breach of this subsection (f) or
any other provision of this Section shall constitute grounds for, or
otherwise entitle, the Company to offset payments otherwise owed to the
Executive under this Agreement.

 

Section 8

Severability

 

If, for any reason, any
one or more of the provisions or part of a provision contained in this
Agreement shall be held to be invalid, illegal or unenforceable in any respect,
such invalidity, illegality or unenforceability shall not affect any other
provision or part of a provision of this Agreement not held so invalid, illegal
or unenforceable, and each other provision or part of a provision shall to the
fullest extent consistent with law continue in full force and effect.

 

Section 9

Amendment,
Termination, or Modification

 

Except as provided below,
this Agreement may not be terminated, modified or amended other than by an
instrument in writing signed by the parties hereto.  No term or condition of this Agreement shall
be deemed to have been waived, nor shall there be any estoppel against the
enforcement of any provision of this Agreement, except by written instrument
signed by the party charged with such waiver or estoppel.  No such written waiver shall be deemed a
continuing waiver unless specifically stated therein, and each such waiver
shall operate only as to the specific term or condition waived and shall not
constitute a waiver of such term or condition for the future or as to any act
other than that specifically waived.

 

Section 10

Consolidation,
Merger, or Sale of Assets; Assignability

 

The Company shall require
(a) any successor (whether direct or indirect, by purchase, merger,
consolidation, or otherwise) to all or substantially all of the business or
assets of the Company and (b) the parent entity owning or controlling such
successor expressly to assume and agree to perform under the terms of this
Agreement in the same manner and to the same extent that the Company and its
affiliates would be required to perform it if no such succession had taken
place (provided that such a requirement to perform which arises by operation of
law shall be deemed to satisfy the requirements for such an express assumption
and agreement).  Except as provided
herein, the Executive’s rights hereunder shall not be assignable.

 

9

 

Section 11

Tax
Withholding

 

The Company may withhold
from any payments made under this Agreement all federal, state or other taxes
as shall be required pursuant to any law or governmental regulation or ruling.

 

Section 12

Entire
Understanding

 

This Agreement contains
the entire understanding between the Company and the Executive with respect to
the subject matter hereof and supersedes any prior agreement between the
Company and the Executive regarding non-compete provisions, except that this
Agreement shall not affect or operate to reduce any benefit or compensation
inuring to the Executive of any kind elsewhere provided and not expressly dealt
with in this Agreement.  This Agreement
supersedes the Prior Agreement.

 

Section 13

Binding
Agreement

 

This Agreement shall be
binding upon, and shall inure to the benefit of, the Executive and the Company
and their respective permitted successors and assigns.

 

Section 14

Employment
Status

 

Nothing
herein contained shall be deemed to create an employment agreement between the
Company and the Executive providing for the employment of the Executive by the
Company for any fixed period of time prior to a Change in Control.  The Executive’s employment with the Company
is terminable at will by the Company or Executive and each shall have the right
to terminate Executive’s employment with the Company at any time, with or
without Cause, subject to the Company’s obligation to provide any benefits
required hereunder.   There are no other
agreements or understandings between the Company and the Executive which
guarantee continued employment to the Executive or guarantee any level of
compensation, including incentive or bonus payments, to the Executive.

 

Section 15

No
Attachment

 

Except as required by
law, no right to receive payments under this Agreement shall be subject to
anticipation, commutation, alienation, sale, assignment, encumbrance, charge,
pledge or hypothecation or to execution, attachment, levy or similar process or
assignment by operation of law, and any attempt, voluntary or involuntary, to
effect any such action shall be null, void and of no effect.

 

Section 16

Notices

 

All notices, requests,
demands and other communications required or permitted hereunder shall be given
in writing and shall be deemed to have been duly given if delivered or mailed,
postage prepaid, first class as follows:

 

(a)          to the Company, at its
Dover, Delaware address

 

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(b)         to the Executive, at the
address maintained by the Company for the Executive for payroll purposes;

 

or to such address as
either party shall have previously specified in writing to the other.

 

Section 17

Revocation
and Executive Acknowledgments

 

The Executive
acknowledges that he has read and understands the provisions of this
Agreement.  The Executive further
acknowledges that he has been given an opportunity for his legal counsel to
review this Agreement and that the provisions of this Agreement are reasonable
and that he has received a copy of this Agreement.

 

Section 18

Headings
of No Effect

 

The section headings
contained in this Agreement are included solely for convenience of reference
and shall not in any way affect the meaning or interpretation of any of the
provisions of this Agreement.

 

Section 19

Applicable
Law

 

This Agreement and its
validity, interpretation, performance, and enforcement shall be governed by the
laws of the State of Delaware.

 

Section 20

Counterparts

 

This Agreement may be
executed in two or more counterparts, each of which shall be an original and
all of which shall be deemed to constitute one and the same instrument.

 

IN WITNESS WHEREOF, the
Company through its officer duly authorized, and the

 

Executive both intending
to be legally bound have duly executed and delivered this Agreement, to be effective
as of the Effective Date.

 

 

	
   

  	
  Dover Downs
  Gaming & Entertainment, Inc.

  
	
   

  	
   

  
	
   

  	
    /s/
  Denis McGlynn

  	
   

  
	
   

  	
  Its: President & Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
    /s/
  Edward J. Sutor

  	
   

  

 

11EXHIBIT 10.3

 

AMENDED & RESTATED

 

EMPLOYMENT AND NON-COMPETE AGREEMENT

 

DOVER DOWNS GAMING & ENTERTAINMENT, INC.

 

AND

 

TIMOTHY R. HORNE

 

THIS AGREEMENT, is by and
between Dover Downs Gaming & Entertainment, Inc. (the “Company”)
and Timothy R. Horne (the “Executive”), is effective as of this 13th day of February 2006
(the “Effective Date”), is effective as of this 13th day of February 2006
(the “Effective Date”), and amends and restates the Employment and Non-Compete
Agreement between the parties dated June 16, 2004 (the “Prior Agreement”).

 

W I T N E S S E T H:

 

WHEREAS, the Executive is
currently employed by the Company or an affiliate thereof in an executive
position; and

 

WHEREAS, the Executive
has, in the course of his employment, developed relationships with employees
and customers of the Company, and learned valuable and sensitive information
concerning the Company’s operations, policies and procedures; and

 

WHEREAS, the Executive
has, in the course of his employment, been exposed to valuable and sensitive
Company reports, files, memoranda, records, software, and other property; and

 

WHEREAS, the Company
recognizes that the solicitation of its employees and customers, and the use or
disclosure of the policies, procedures, information, documents, and property of
the Company would be damaging to the Company’s interests; and

 

WHEREAS, the Company has
determined that it is in the best interests of the Company to protect its
interests through the use of Employment and Non-Compete Agreements; and

 

WHEREAS, the Company has
determined that it is in the best interests of the Company and its shareholders
for the Company to agree to provide benefits under the circumstances described
below to the Executive and other executives who agree to such an agreement.

 

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

 

 

Section 1

Definitions

 

“Announcement” shall mean
a press release issued by the Company announcing the signing of an agreement
whereby the Company will be acquired by or merge with any other entity or a
tender offer for the shares of the Company stock will be initiated.

 

“Board” shall mean the
Board of Directors of the Company or the ultimate corporate parent entity which
owns the Company if the Company is not public.

 

“Cause” shall mean a
unanimous determination by the Board that the Executive has been convicted of a
felony, has embezzled from, or committed fraud against, the Company which
embezzlement or fraud has a material adverse financial impact on the Company or
gross insubordination which has continued after written notice of such from the
Board which determination is upheld by a final, non-appealable arbitration
award pursuant to Section 6.

 

“Change in Control” shall
mean the earlier to occur of (a) ten (10) days following the closing
of a tender offer for the Company’s stock following the Announcement or (b) the
closing of a merger or similar transaction (“Transaction”) of the Company and
any other entity; provided, however, a Transaction the result of which is the
shareholders of the Company’s voting securities immediately prior to the
Transaction own, directly or indirectly in substantially the same proportion,
at least 60% of the voting securities of the survivor of such Transaction
immediately following such Transaction shall not be a Change in Control.

 

“Change in Control Fee”
shall mean $250, 000.

 

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

 

“Company Information”
shall mean (i) confidential information including, without limitation,
information received from third parties under confidential conditions, (ii) information
subject to the Company’s and its affiliates’ attorney-client or work-product
privilege; and (iii) other technical, business, legal or financial
information (including, without limitation, customer lists), the use or
disclosure of which might reasonably be construed to be contrary to the Company’s
and its affiliates’ interests.

 

“Date of Termination”
shall mean the date on which the Executive’s employment is terminated.

 

“Employment Period” shall
mean the period of time during the Extension Period the Executive is an
employee of the Company.

 

“Extension Period” shall
mean the 24 month period following the Change in Control.

 

“Good Reason” shall mean
a (i) reduction in title, responsibilities, administrative support or
support services, (ii) relocation of Executive’s office, (iii) travel
at a level that exceeds the travel requirements before the Change in Control, (iv) any
breach by the Company of its obligations hereunder, (v) any breach by the
purchaser under a merger or acquisition agreement pursuant to which the Change
in Control takes place relating to employee benefits or directors’ and officers’

 

2

 

insurance or
indemnification provisions, or (vi) any reason whatsoever two months after
the Change in Control.

 

“Monthly Amount” shall be an amount equal to one-twelfth
of the sum of (a) the Executive’s then current annual base salary
(excluding any incentive or bonus), and (b) the amount of any cash bonus
awarded to the Executive for the then most recently concluded fiscal year of
the Company.

 

“Non-Compete Monthly
Amount” shall mean the portion of the Monthly Amount which is paid in
consideration of the Executive’s agreement to the restrictions and other
provisions of Section 7, with the remainder of the Monthly Amount and
other benefits under this Agreement paid after the Employment Period to be
treated as severance.  Executive’s
Non-Compete Monthly Amount shall be calculated by multiplying the Monthly
Amount by fifty percent.

 

“Retirement Plan” shall
mean the Company’s qualified defined benefit retirement plan(s) in which the
Executive participates.

 

“SERP” shall mean any and
all supplemental retirement plans in which the Executive participates
(including, but not limited to, any benefit restoration plan(s) maintained by
the Company from time to time).

 

Section 2

Term
of Agreement

 

This
Agreement shall be effective as of the Effective Date and shall automatically
terminate if the Executive’s employment is terminated.  Renewal of this Agreement shall
automatically occur for successive two (2) year terms, provided that at
any time prior to any such renewal, the Company’s Compensation and Stock Incentive
Committee shall have the discretion to terminate this automatic renewal
provision.

 

Section 3

Benefits

 

(a)          On the date of a Change
in Control, the Company shall pay to the Executive in cash the Change in
Control Fee.

 

(b)         During the Extension
Period, the Company shall pay to the Executive the Monthly Amount, payable on
the first day of each month, prorated for partial months.

 

(c)          If the Executive’s
employment is terminated during the Extension Period, then,

 

(i)                                     within
five business days after the Date of Termination, the Company shall pay to the
Executive (or if the Executive dies, to the estate of the Executive) in cash
all accrued but unpaid salary, earned but unpaid bonuses, and accrued but
unused vacation in accordance with Company policies;

 

(ii)                                  the
Company shall pay to the Executive (or if the Executive dies, to the estate of
the Executive) the Monthly Amount on the first day of each month during the
remainder of the Extension Period;

 

3

 

(iii)                               the
Company shall pay to the Executive (or if the Executive dies, to his
beneficiary, if any, under the Retirement Plan) a lump sum amount equal to the
value of the monthly benefit under (x) the Retirement Plan and (y) the SERP,
that the Executive or his beneficiary, if any, under the Retirement Plan would
have received (1) for payments of the Monthly Amount had Executive been an
employee while receiving such payments, and (2) for payment of the Change
of Control Fee had such amount been treated as a normal bonus for pension
accrual purposes (giving credit for all purposes, including, but not limited
to, accrual of benefits, vesting, age and years of service and making the
determination without regard to compensation or benefit limitations prescribed
by federal law or regulation), which payment shall be paid within 10 days of
the Date of Termination and calculated by Buck Consultants (or such other
consultant as may be agreed upon) using the actuarial assumptions under the
Retirement Plan and the discount rate which would be utilized for purposes of
funding a Plan termination;

 

(iv)                              on
the Date of Termination the Company shall transfer title and ownership to the
Executive of his laptop computer, if any, without any payment by the Executive
to the Company.

 

(d)         During the Extension
Period (whether or not during the Employment Period) the Executive shall be
entitled to the following additional benefits:

 

(i)                                     The
Executive and, as applicable, the Executive’s covered dependents shall be
entitled to all health, welfare, and fringe benefits provided by the Company to
its key employees generally or to the Executive on an individual or group basis
(including, but not limited to, any life, accident, health, hospitalization or
long-term disability insurance, maintained from time to time by the Company),
whether maintained pursuant to a plan, policy or other arrangement (written or
unwritten), as if the Executive were still employed during such period, at the
same level of benefits and at the same dollar cost to the Executive as is
available generally to comparable employees of the Company (but in no instances
shall such benefits be at a level less than as in effect on the date of the
Change in Control).  If the Company
reasonably determines that the coverage required under this Section would
cause a welfare plan sponsored by the Company to violate any provision of the
Code prohibiting discrimination in favor of highly compensated employees or key
employees, or if any benefits described in this Section cannot be provided
(or the Company determines that it does not wish to provide such benefits)
pursuant to the appropriate plan or program maintained for employees of the
Company, the Company shall provide such benefits outside such plan or program
at no additional cost (on an after tax basis) to the Executive or, if the
parties shall so agree, the Company will pay to the Executive the cash
equivalent thereof.  The health benefits
provided in accordance with this Section shall be secondary to any
comparable benefits provided by another employer if and only if the Executive
chooses to be covered by such other employee plan.

 

(ii)                                  Executive
shall receive continued payment of professional and organizational dues and
fees as in effect prior the Change in Control.

 

(e)          (i)  If all, or any
portion, of the payments and benefits provided under this Agreement, if any,
either alone or together with other payments and benefits which the Executive
receives or is entitled to receive from the Company, would constitute an excess
“parachute payment” within the meaning of Section 280G of the Code
(whether or not under an existing plan, arrangement, or other agreement) (each
such parachute payment, a “Parachute Payment”), and would result in the
imposition on the Executive of an excise tax under Section 4999 of the
Code, then, in addition to

 

4

 

any other benefits to
which the Executive is entitled under this Agreement or otherwise, the
Executive shall be paid an amount in cash equal to the sum of the excise taxes
payable by the Executive by reason of receiving Parachute Payments plus the
amount necessary to place the Executive in the same after-tax position (taking
into account any and all applicable federal, state and local excise, income or
other taxes at the highest possible applicable rates on such Parachute Payments
(including, without limitation, any payments under this Section) as if no
excise taxes had been imposed with respect to Parachute Payments (the “Parachute
Gross-Up”).  Any Parachute Gross-Up
otherwise required by this Section shall not be made later than the time
of the corresponding payment or benefit hereunder giving rise to the underlying
Section 4999 excise tax, even if the payment of the excise tax is not
required under the Code until a later time.

 

(ii)                                  Subject
to the provisions of Section 3(d) and except as may otherwise be
agreed to by the Company and the Executive, the amount or amounts (if any)
payable under this Section 3 shall be as conclusively determined by the
KPMG LLP, or such other firm as mutually agreed to by the Company and the
Executive (“Independent Tax Counsel”), whose determination or determinations
shall be final and binding on all parties. 
The Executive shall agree to utilize such determination or
determinations, as applicable, in filing all of the Executive’s tax returns
with respect to the excise tax imposed by Section 4999 of the Code, if
any.  If such Independent Tax Counsel
fails or refuses to make the required determinations for any reason, then such
determinations shall be made by a comparable firm or group of national
reputation to which the parties reasonably mutually agreed.  All fees and expenses of the Independent Tax
Counsel or its replacement shall be paid by the Company.

 

(iii)                               As
a result of the uncertainty in the application of Section 4999 of the Code
at the time of the initial determination by the Independent Tax Counsel
hereunder, it is possible that Parachute Gross-Up payments, if any, which will
not have been made by the Company, should have been made, together with any
interest, penalties or taxes of any kind thereon, consistent with the
calculations required to be made hereunder (an “Underpayment”).  The Company shall pay all such Underpayments
to or for the benefit of the Executive. 
The Executive shall notify the Company in writing of any claim by the
Internal Revenue Service that, if successful, would require the payment by the
Company of the Gross-Up Payment within ten (10) business days after the
Executive is informed in writing of such claim. 
The Company shall notify the Executive within ten (10) business
days of receipt of the Executive notice that the Company (x) will pay the
Underpayment and do so on or before the date due, or (y) that it desires to
contest such claim.  The Executive will
cooperate with the Company in any such contest; provided, however, that the
Company shall bear and pay directly all costs and expenses (including
additional interest and penalties) incurred in connection with such contest and
shall indemnify and hold the Executive harmless, on an after-tax basis, for any
Excise Tax or income tax (including interest and penalties with respect
thereto) imposed as a result of such representation and payment of costs and
expenses.  Furthermore, the Company’s
control of the contest shall be limited to issues with respect to which a
Gross-Up Payment would be payable hereunder and the Executive shall be
entitled, at Executive’s expense, to settle or contest, as the case may be, any
other issue raised by the Internal Revenue Service or any other taxing
authority.

 

(iv)                              References
herein to Code sections shall apply to comparable Code sections in the event of
any amendment to the Code.

 

5

 

(v)                                 The
foregoing provisions of this subsection (f) shall similarly apply to
any benefit provided elsewhere in this Agreement where it is expressly provided
that the benefit is to be provided on an after tax basis.

 

(f)            In the event of the
Executive’s termination of employment under this Agreement, the Executive shall
be under no obligation to seek other employment, and there shall be no offset
against amounts due the Executive under this Agreement on account of any
remuneration attributable to any subsequent employment.

 

In the
event that Executive’s employment is terminated by the Company for Cause (and
Executive was not capable of voluntarily terminating for Good Reason at or
prior to such time) or if Executive voluntarily terminates without Good Reason,
the Company shall remain obligated to pay the Non-Compete Monthly Amount but
shall not be obligated to pay the balance of the Monthly Amount.  Executive is free to terminate his employment
for Good Reason.

 

Section 4

Employment

 

Following a Change in
Control, the Executive will, except as provided below, continue as an employee
during the Extension Period.  During the
Employment Period:

 

(i)                                     The
Executive shall perform services consistent with his past practices,

 

(ii)                                  The
Executive shall not be required to relocate or travel in excess of past
practices,

 

(iii)                               The
Executive shall enjoy the same office, administrative support and support
services as he enjoyed prior to the Change in Control.

 

(iv)                              The
Executive shall not be required to devote more time to Company business than he
did prior to the Change in Control and may continue director or officer
positions with other private or public entities that do not violate Section 7.

 

(v)                                 The
Executive’s expenses shall be reimbursed consistent with past practices, and

 

(vi)                              The
Executive shall receive at least the same vacation as he currently enjoys, but
not less than four weeks paid vacation.

 

No breach or alleged
breach of this Section 4 shall constitute grounds for, or otherwise
entitle, the Company to offset payments otherwise owing to the Executive under
this Agreement.

 

Section 5

Source
of Payments

 

All payments provided for
in this Agreement shall be paid in cash from the general funds of the Company;
provided, however, that such payments shall be reduced by the amount of any
payments made to the Executive or his dependents, beneficiaries or estate from
any trust or special or separate fund established by the Company to assure such
payments.  The Company shall not be

 

6

 

required to
establish a special or separate fund or other segregation of assets to assure
such payments.

 

Section 6

Litigation
Expenses and Arbitration

 

In addition to the
Company’s other obligations under this Agreement, the Company shall pay all
legal fees and expenses incurred in a legal proceeding (including arbitration)
by the Executive in seeking to obtain or enforce any right or benefit provided
by this Agreement (including, without limitation, any rights to a tax
gross-up).  Such payments are to be made
within five days after the Executive’s request for payment accompanied with
such evidence of fees and expenses incurred as the Company reasonably may
require; provided, however, that if the Executive institutes a proceeding and
the judge or other decision-maker presiding over the proceeding affirmatively
finds that the Executive has failed to prevail substantially, he shall pay his
own costs and expenses (and, if applicable, return any amounts theretofore paid
on his behalf under this Section 6.

 

All disputes with respect
to the subject matter of this Agreement and the enforcement of rights hereunder
shall be submitted to binding arbitration in accordance with the rules of
the American Arbitration Association (the “AAA”).  Each party hereto shall designate one
arbitrator (who need not be impartial) within fifteen (15) days after notice of
the dispute. The two arbitrators so designated shall endeavor to designate
promptly a third, neutral arbitrator. If the two arbitrators have not
designated the third arbitrator by the fifteenth (15th) day following
the designation of the second arbitrator, or if a second arbitrator has not
been designated by the (15th) day following the designation of the
first, either Party may request the AAA to designate the remaining
arbitrator(s). The third arbitrator shall take an oath of neutrality. The
arbitrators shall not be bound by judicial formalities and may abstain from
following the strict rules of evidence and shall interpret this Agreement
as an honorable engagement and not merely as a legal obligation. The arbitrators
shall have the power to render equitable relief as may be available in
accordance with applicable law.  Unless
otherwise agreed by the parties, any such arbitration shall take place in such
City within the United States as Executive may designate, and shall be
conducted in accordance with the Rules of the AAA.  The determination reached in such arbitration
shall be final and binding on both parties without any right of appeal or
further dispute. The arbitrators’ award may be confirmed in, and judgment upon
the award entered by, any federal or state court having jurisdiction over the
parties.

 

Section 7

Restrictive
Covenants

 

(a)          Within a reasonable
period of time following his termination of employment, the Executive shall
return to the Company all Company Information, reports, files, memoranda,
records, credit cards, cardkey passes, door and file keys, computer access
codes, and other property which the Executive has received, prepared, or helped
to prepare in connection with his employment with the Company, except as
provided in Section 3.  The
Executive acknowledges that in the course of employment with the Company, he
has acquired Company Information and that such Company Information has been
disclosed to him in confidence and for the Company’s use only.  The Executive agrees that, during the
Extension Period, he (i) will keep such Company Information confidential
at all times, (ii) will not disclose or communicate Company Information to
any third party, and (iii) will not make use of Company Information on his
own behalf or on behalf

 

7

 

of any third party.  The Executive further acknowledges and agrees
that the Company’s remedy in the form of monetary damages for any breach by him
of any of the provisions of this Section may be inadequate and that, in
addition to any monetary damages for such breach, the Company shall be entitled
to institute and maintain any appropriate proceeding or proceedings, including
an action for specific performance and/or injunction.

 

(b)         Executive agrees not to,
during the Extension Period, within the Territory, directly or indirectly,
individually or on behalf of persons not now parties to this Agreement, or as a
director, officer, principal, agent, executive, or in any other capacity or
relationship, engage in the casino business (except as a passive investor
holding not more than 3% of the equity of such business), or aid or endeavor to
assist any business or legal entity, that is in the casino business and that
competes with the Company anywhere in the Territory.  The Territory shall consist of both the
entire State of Delaware and a 50-mile radius around the Company’s facility in
Dover, Delaware.  The Company and
Executive acknowledge the reasonableness of this covenant not to compete and
the reasonableness of the geographic area and duration of time which are a part
of said covenant.

 

(c)          Unless waived in writing
by the Company, Executive further agrees that he will not, directly or
indirectly, during the Extension Period, solicit the trade or patronage of any
of the customers of the Company, regardless of the location of such customers
of the Company with respect to any services, products, or other matters in
which the Company is active.

 

(d)         Unless waived in writing
by the Company, Executive further agrees that he will not, directly or
indirectly, during the Extension Period, solicit or attempt to entice away from
the Company any director, agent or employee of the Company.

 

(e)          Executive acknowledges
that the Company has no adequate remedy at law and would be irreparably harmed
if Executive breaches or threatens to breach any of the provisions of this Section and,
therefore, agrees that the Company shall be entitled to injunctive relief to
prevent any such breach or threatened breach thereof and to specific
performance of the terms of this Section  (in addition to any other legal
or equitable remedy the Company may have, including if so determined by
arbitration, that the Company is not obligated to pay to the Executive (or the
Executive is required to repay to the Company) a portion or all of the
Non-Compete Monthly Amount; provided, however, in all instances the Company
shall continue to pay to Executive the Non-Compete Monthly Amount unless and
until all appeals have been exhausted or the time for such has expired).  Executive further agrees that Executive shall
not, in any equity proceeding relating to the enforcement of this Section,
raise the defense that the Company has an adequate remedy at law.  Nothing in this Agreement shall be construed
as prohibiting the Company from pursuing any other remedies at law or in equity
that it may have under and in respect of this Agreement or any other agreement.

 

(f)            The Executive agrees
to pay to the Company any outstanding amounts owed to the Company; provided,
however, that no breach or alleged breach of this subsection (f) or
any other provision of this Section shall constitute grounds for, or
otherwise entitle, the Company to offset payments otherwise owed to the
Executive under this Agreement.

 

8

 

Section 8

Severability

 

If, for any reason, any
one or more of the provisions or part of a provision contained in this
Agreement shall be held to be invalid, illegal or unenforceable in any respect,
such invalidity, illegality or unenforceability shall not affect any other
provision or part of a provision of this Agreement not held so invalid, illegal
or unenforceable, and each other provision or part of a provision shall to the
fullest extent consistent with law continue in full force and effect.

 

Section 9

Amendment,
Termination, or Modification

 

Except as provided below,
this Agreement may not be terminated, modified or amended other than by an
instrument in writing signed by the parties hereto.  No term or condition of this Agreement shall
be deemed to have been waived, nor shall there be any estoppel against the
enforcement of any provision of this Agreement, except by written instrument
signed by the party charged with such waiver or estoppel.  No such written waiver shall be deemed a
continuing waiver unless specifically stated therein, and each such waiver
shall operate only as to the specific term or condition waived and shall not
constitute a waiver of such term or condition for the future or as to any act
other than that specifically waived.

 

Section 10

Consolidation,
Merger, or Sale of Assets; Assignability

 

The Company shall require
(a) any successor (whether direct or indirect, by purchase, merger,
consolidation, or otherwise) to all or substantially all of the business or
assets of the Company and (b) the parent entity owning or controlling such
successor expressly to assume and agree to perform under the terms of this
Agreement in the same manner and to the same extent that the Company and its
affiliates would be required to perform it if no such succession had taken
place (provided that such a requirement to perform which arises by operation of
law shall be deemed to satisfy the requirements for such an express assumption
and agreement).  Except as provided
herein, the Executive’s rights hereunder shall not be assignable.

 

Section 11

Tax
Withholding

 

The Company may withhold
from any payments made under this Agreement all federal, state or other taxes
as shall be required pursuant to any law or governmental regulation or ruling.

 

Section 12

Entire
Understanding

 

This Agreement contains
the entire understanding between the Company and the Executive with respect to
the subject matter hereof and supersedes any prior agreement between the
Company and the Executive regarding non-compete provisions, except that this
Agreement shall not affect or operate to reduce any benefit or compensation
inuring to the Executive of any kind elsewhere provided and not expressly dealt
with in this Agreement.  This Agreement
supersedes the Prior Agreement

 

9

 

Section 13

Binding
Agreement

 

This Agreement shall be
binding upon, and shall inure to the benefit of, the Executive and the Company
and their respective permitted successors and assigns.

 

Section 14

Employment
Status

 

Nothing
herein contained shall be deemed to create an employment agreement between the
Company and the Executive providing for the employment of the Executive by the
Company for any fixed period of time prior to a Change in Control.  The Executive’s employment with the Company
is terminable at will by the Company or Executive and each shall have the right
to terminate Executive’s employment with the Company at any time, with or
without Cause, subject to the Company’s obligation to provide any benefits
required hereunder.   There are no other
agreements or understandings between the Company and the Executive which
guarantee continued employment to the Executive or guarantee any level of compensation,
including incentive or bonus payments, to the Executive.

 

Section 15

No
Attachment

 

Except as required by
law, no right to receive payments under this Agreement shall be subject to
anticipation, commutation, alienation, sale, assignment, encumbrance, charge,
pledge or hypothecation or to execution, attachment, levy or similar process or
assignment by operation of law, and any attempt, voluntary or involuntary, to
effect any such action shall be null, void and of no effect.

 

Section 16

Notices

 

All notices, requests,
demands and other communications required or permitted hereunder shall be given
in writing and shall be deemed to have been duly given if delivered or mailed,
postage prepaid, first class as follows:

 

(a)          to the Company, at its
Dover, Delaware address

 

(b)         to the Executive, at the
address maintained by the Company for the Executive for payroll purposes;

 

or to such address as
either party shall have previously specified in writing to the other.

 

Section 17

Revocation
and Executive Acknowledgments

 

The Executive
acknowledges that he has read and understands the provisions of this
Agreement.  The Executive further
acknowledges that he has been given an opportunity for his legal counsel to
review this Agreement and that the provisions of this Agreement are reasonable
and that he has received a copy of this Agreement.

 

10

 

Section 18

Headings
of No Effect

 

The section headings
contained in this Agreement are included solely for convenience of reference
and shall not in any way affect the meaning or interpretation of any of the
provisions of this Agreement.

 

Section 19

Applicable
Law

 

This Agreement and its
validity, interpretation, performance, and enforcement shall be governed by the
laws of the State of Delaware.

 

Section 20

Counterparts

 

This Agreement may be
executed in two or more counterparts, each of which shall be an original and
all of which shall be deemed to constitute one and the same instrument.

 

IN WITNESS WHEREOF, the
Company through its officer duly authorized, and the

 

Executive both intending
to be legally bound have duly executed and delivered this Agreement, to be
effective as of the Effective Date.

 

 

	
   

  	
  Dover Downs
  Gaming & Entertainment, Inc.

  
	
   

  	
   

  
	
   

  	
    /s/
  Denis McGlynn

  	
   

  
	
   

  	
  Its: President & Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
    /s/
  Timothy R. Horne

  	
   

  

 

11

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