Document:

Exhibit
10.26

 

EMPLOYMENT AGREEMENT

 

This Employment Agreement (this “Agreement”) is entered into as of
October 13, 2003 by and between Poster Financial Group, Inc. (“Employer”), and
Timothy Poster (“Employee”).

 

1.                                       Employment.  Employer hereby employs
Employee, and Employee hereby accepts employment by the Employer, as Employer’s
Chief Executive Officer to perform such executive, managerial or administrative
duties, commensurate with Employee’s position, as Employer’s Board of Directors
(the “Board”) may specify from time to time, during the Specified Term (as
defined in Section 2).

 

2.                                       Effective Date; Specified Term.  This Agreement shall be effective on the Closing Date as such term
is defined in the Stock Purchase Agreement, dated as of June 24, 2003 (the
“Stock Purchase Agreement”), by and among MGM MIRAGE, Mirage Resorts,
Incorporated, GNLV, CORP., GNL CORP., Golden Nugget Experience, LLC and
Employer.  Subject to earlier
termination as provided herein, the term of the Employee’s employment hereunder
shall commence on the Closing Date and terminate on the third anniversary
thereof (the “Specified Term”). If Employee remains employed by Employer
following the Specified Term, any such employment shall be on an at will basis
unless the parties agree in writing to extend the Specified Term.  This Agreement shall be null and void and of
no force and effect if the Closing, as such term is defined in the Stock
Purchase Agreement, does not occur.

 

3.                                       Base
Salary.  During the Specified
Term, in consideration of the performance by Employee of Employee’s obligations
hereunder to Employer and its parents, subsidiaries, affiliates and joint
ventures (collectively, the “Employer Group”), in any capacity (including any
service as a director), Employer shall pay Employee an annual base salary of
not less than $500,000 (the “Base Salary”). 
The Base Salary shall be payable in accordance with the payroll
practices of Employer as in effect from time to time for Employer’s senior
executives.

 

4.                                       Bonus
Compensation.  Employee
shall be eligible to receive such annual or other bonuses as may be determined
in the sole discretion of the Board.

 

5.                                       Employee Benefit Programs. 
During the Specified Term, Employee shall be entitled to participate in
Employer’s employee benefit plans as are generally made available from time to
time to Employer’s senior executives, subject to the terms and conditions of
such plans, and subject to Employer’s right to amend, terminate or take other
similar actions with respect to such plans.

 

6.                                       Business Expense Reimbursements. 
Employer will pay or reimburse Employee for all reasonable out-of-pocket
expenses, including travel expenses, Employee incurs during the Specified Term
in the course of performing Employee’s duties under this Agreement upon timely
submission of appropriate documentation to Employer, as prescribed from time to
time by Employer.

 

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7.                                       Car Allowance.  During the Specified Term, Employer shall
provide Employee with a monthly car allowance of $2,000.

 

8.                                       Extent of
Services.   Employee agrees that the duties and services
to be performed by Employee shall be performed exclusively for members of the
Employer Group.  Employee further agrees
to perform such duties in an efficient, trustworthy and businesslike
manner.  Employee agrees not to render
to others any service of any kind whether or not for compensation, or to engage
in any other business activity whether or not for compensation, that is similar
to or conflicts with the performance of Employee’s duties under this Agreement,
without the written approval of the Board.

 

9.                                       Policies and Procedures. 
In addition to the terms herein, Employee agrees to be bound by
Employer’s policies and procedures as they may be amended by Employer from time
to time.  In the event the terms in this
Agreement conflict with Employer’s policies and procedures, the terms herein
shall take precedence.  Employer
recognizes that it has a responsibility to see that its employees understand
the adverse effects that problem gambling and underage gambling can have on
individuals and the gaming industry as a whole.  Employee acknowledges having read Employer’s policies, procedures
and manuals and agrees to abide by the same, including but not limited to
Employer’s policy of prohibiting underage gaming and supporting programs to
treat compulsive gambling.

 

10.                                 Licensing Requirements. 
Employee acknowledges that Employer is engaged in a business that is or
may be subject to and exists because of privileged licenses issued by governmental
authorities in Nevada and other jurisdictions in which Employer is engaged or
has applied or during the Specified Term may apply to engage in the gaming
business.  If requested to do so by
Employer, Employee shall apply for and obtain any license, qualification,
clearance or the like which shall be requested or required of Employee by any
regulatory authority having jurisdiction over Employer.

 

11.                                 Failure to Satisfy
Licensing Requirement.  If Employee
fails to satisfy any licensing requirement referred to in Section 10 above, or
if any governmental authority directs the Employer to terminate any
relationship it may have with Employee, or if Employer shall determine, in
Employer’s sole and exclusive judgment, that Employee was, is or might be involved
in, or is about to be involved in, any activity, relationship(s) or
circumstance which could or does jeopardize Employer’s business, reputation or
such licenses, or if any such license is threatened to be, or is, denied,
curtailed, suspended or revoked, this Agreement may be terminated by Employer
and the parties’ obligations and responsibilities shall be determined by the
provisions of Section 15.

 

12.                                 Restrictive
Covenants.

 

a.                                       Competition. 
Employee acknowledges that, in the course of Employee’s responsibilities
hereunder, Employee will form relationships and become acquainted with certain
confidential and proprietary information as further described in Section
12(b).  Employee further acknowledges
that such relationships and information are and will remain valuable to the
Employer Group

 

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and that the restrictions on future
employment, if any, are reasonably necessary in order for Employer to remain
competitive in the gaming industry.  In
recognition of Employer’s heightened need for protection from abuse of
relationships formed or information garnered before and during the Specified
Term of the Employee’s employment hereunder, Employee covenants and agrees for
the twelve (12) month period immediately following termination of employment
for any reason, unless such employment is terminated by Employer without Cause
or by Employee for Good Reason (as such terms are defined below) (the
“Restrictive Period”), not to directly or indirectly be employed by, provide
consultation or other services to, engage or participate in, provide advice,
information or assistance to, fund or invest in, or otherwise be connected or
associated in any way or manner with, any firm, person, corporation or other
entity which is either directly, indirectly or through an affiliated company or
entity, engaged in gaming or proposes to engage in gaming in the State of
Nevada, or in or within a 150 mile radius of any other jurisdiction in which
any member of the Employer Group during the Restrictive Period is engaged in
gaming or proposes to engage in gaming (“Competitor”).  The covenants under this Section 12(a)
include but are not limited to Employee’s covenant not to:

 

i.                                          Make known to any third party the
names and addresses of any of the customers of any member of the Employer
Group, or any other information pertaining to those customers;

 

ii.                                       Call on, solicit, induce to leave
and/or take away, or attempt to call on, solicit, induce to leave and/or take
away, any of the customers of any member of the Employer Group, either for
Employee’s own account or for any third party;

 

iii.                                    Call on, solicit and/or take away,
any potential or prospective customer of any member of the Employer Group, on
whom the Employee called or with whom Employee became acquainted during
employment (either before or during the Specified Term) by any member of the
Employer Group, either for Employee’s own account or for any third party; and

 

iv.                                   Approach or solicit any employee or
independent contractor of any member of the Employer Group with a view towards
enticing such person to leave the employ or service of any member of the
Employer Group, or hire or contract with any employee or independent contractor
of any member of the Employer Group, without the prior written consent of the
Employer, such consent to be within Employer’s sole and absolute discretion.

 

b.                                      Confidentiality. 
Employee covenants and agrees that Employee shall not at any time during
the Specified Term or thereafter, without Employer’s prior written consent,
such consent to be within Employer’s sole and absolute discretion, disclose or
make known to any person or entity outside of the Employer Group

 

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any Trade Secret (as defined below), or
proprietary or other confidential information concerning any member of the
Employer Group, including without limitation, Employer’s customers and its
casino, hotel and marketing practices, procedures, management policies or any
other information regarding any member of the Employer Group which is not
already and generally known to the public through no wrongful act of Employee
or any other party.  Employee covenants
and agrees that Employee shall not at any time during the Specified Term, or
thereafter, without the Employer’s prior written consent, utilize any such
Trade Secrets, proprietary or confidential information in any way, including
communications with or contact with any such customer other than in connection
with employment hereunder.  Not by way
of limitation but by way of illustration, Employee agrees that such Trade
Secrets, proprietary or confidential information specifically include, but are
not limited to, any documents or reports prepared by Employee in connection
with the performance of his duties hereunder. For purposes of this Section 12,
Trade Secrets is defined as information (including, but not limited to, all
information, materials or terms included within the Nevada Revised Statutes (“NRS”)),
including a formula, pattern, compilation, program, device, method, know-how,
technique or process, that derives economic value, present or potential, from
not being generally known to, and not being readily ascertainable by proper
means by, other persons who may or could obtain any economic value from its
disclosure or use.

 

c.                                       Former Employer Information. 
Employee will not intentionally, during the Specified Term, improperly
use or disclose any proprietary information or Trade Secrets of any former
employer or other person or entity and will not bring onto the premises of the
Employer any unpublished document or proprietary information belonging to any
such employer, person or entity unless consented to in writing by such
employer, person or entity.

 

d.                                      Third Party Information. 
Employee acknowledges that Employer and other members of the Employer
Group have received and in the future will receive from third parties their
confidential or proprietary information subject to a duty to maintain the
confidentiality of such information and to use it only for certain limited
purposes.  Employee will hold all such
confidential or proprietary information in the strictest confidence and will
not disclose it to any person or entity or to use it except as necessary in
carrying out Employee’s duties hereunder consistent with Employer’s (or such
other member of the Employer Group’s) agreement with such third party.

 

e.                                       Employer’s Property. 
Employee hereby confirms that Trade Secrets, proprietary or confidential
information and all information concerning customers who utilize the goods,
services or facilities of any hotel and/or casino owned, operated or managed by
Employer constitute Employer’s exclusive property (regardless of whether
Employee possessed or claims to have possessed such information prior to the
date hereof).  Employee agrees that upon
termination of employment,

 

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Employee shall promptly return to the
Employer all notes, notebooks, memoranda, computer disks, and any other similar
repositories of information (regardless of whether Employee possessed such
information prior to the date hereof) containing or relating in any way to the
Trade Secrets or proprietary or confidential information of each member of the
Employer Group, including but not limited to, the documents referred to
in Section 12(b).  Such
repositories of information also include but are not limited to any so-called
personal files or other personal data compilations in any form, which in any
manner contain any Trade Secrets or proprietary or confidential information of
any member of the Employer Group.

 

f.                                         Notice to Employer. 
Employee agrees to notify Employer immediately of any employers for whom
Employee works or provides services (whether or not for remuneration to
Employee or a third party) during the Specified Term or within the Restrictive
Period.  Employee further agrees to
promptly notify Employer, during Employee’s employment with Employer, of any
contacts made by any gaming licensee which concern or relate to an offer of
future employment (or consulting services) to Employee.

 

13.                                 Representations.   Employee hereby represents, warrants and agrees with Employer
that:

 

a.                                       The covenants and agreements
contained in Sections 8 and 12 above are reasonable, appropriate and suitable
in their geographic scope, duration and content; the Employer’s agreement to
employ the Employee and a portion of the compensation and consideration to be
paid to Employee hereunder, is in partial consideration for such covenants and
agreements; the Employee shall not, directly or indirectly, raise any issue of
the reasonableness, appropriateness and suitability of the geographic scope,
duration or content of such covenants and agreements in any proceeding to
enforce such covenants and agreements;  and
such covenants and agreements shall survive the termination of this Agreement,
in accordance with their terms;

 

b.                                      The enforcement of any remedy under
this Agreement will not prevent Employee from earning a livelihood, because
Employee’s past work history and abilities are such that Employee can
reasonably expect to find work in other areas and lines of business;

 

c.                                       The covenants and agreements stated
in Sections 8, 10, 11 and 12 above are essential for the Employer’s reasonable
protection;

 

d.                                      Employer has reasonably relied on
these covenants and agreements by Employee; and

 

e.                                       Employee has the full right to enter
into this Agreement and by entering into and performance of this Agreement will
not violate or conflict with any arrangements or agreements Employee may have
or agreed to have with any other person or entity.

 

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Additionally,
Employee agrees that in the event of Employee’s breach or threatened breach of
any covenants and agreements set forth in Sections 8 and 12 above, Employer may
seek to enforce such covenants and agreements through any equitable remedy,
including specific performance or injunction, without waiving any claim for
damages.  In any such event, Employee
waives any claim that the Employer has an adequate remedy at law or for the
posting of a bond.

 

14.                                 Termination for
Death or Disability.  Employee’s
employment hereunder shall terminate upon Employee’s death or Disability (as
defined below).  In the event of
Employee’s death or Disability, Employee (or Employee’s estate or beneficiaries
in the case of death) shall have no right to receive any compensation or
benefit hereunder or otherwise from any member of the Employer Group on and
after the effective date of termination of employment other than (1) unpaid
Base Salary earned to the date of termination of employment (which shall be
paid on Employer’s next scheduled payroll date), (2) any earned but unpaid
bonus then payable to Employee (which shall be paid on Employer’s next
scheduled payroll date), (3) business expense reimbursement pursuant to Section
6, (4) benefits provided pursuant to Section 5, subject to the terms and
conditions applicable thereto and (5) continued Base Salary payments for three
(3) months from the date of termination of employment to be paid in accordance
with Employer’s scheduled payroll practices (in the case of Disability, offset
by amounts payable to Employee pursuant to any disability plan sponsored by any
member of the Employer Group). For purposes of this Section 14, Disability is
defined as Employee’s incapacity, certified by a licensed physician selected by
Employer (“Employer’s Physician”), which precludes Employee from performing the
essential functions of Employee’s duties hereunder for a substantial portion of
any consecutive period of six (6) months or more.  In the event Employee disagrees with the conclusions of the
Employer’s Physician, Employee (or Employee’s representative) shall designate a
physician (“Employee’s Physician”), and Employer’s Physician and Employee’s Physician
shall jointly select a third physician (“Third Physician”), who shall make the
determination which determination shall be final and binding on the parties
hereto.  Employee hereby consents to any
examination or to provide or authorize access to any medical records that may
be reasonably required by Employer’s Physician or the Third Physician in
connection with any determination to be made pursuant to this Section 14.

 

15.                                 Termination by
Employer for Cause.  Employer may
terminate Employee’s employment hereunder for Cause (as defined below) at any
time.  If Employer terminates Employee’s
employment for Cause, Employee shall have no right to receive any compensation
or benefit hereunder or otherwise from any member of the Employer Group on and
after the effective date of termination of employment other than (1) unpaid
Base Salary earned to the date of termination of employment (which shall be
paid on Employer’s next scheduled payroll date), (2) business expense
reimbursement pursuant to Section 6, and (3) benefits provided pursuant to
Section 5, subject to the terms and conditions applicable thereto.  For purposes of this Section 15, Cause is
defined as Employee’s (a) failure to abide by Employer’s policies and procedures,
(b) misconduct, insubordination, or inattention to Employer’s business, (c)
failure to perform the duties required of Employee up to the

 

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standards established by the Board, or other material breach of this
Agreement (other than as a result of a Disability), or (d) failure or inability
to satisfy the requirements stated in Section 11 above.  Notwithstanding the foregoing, prior to
terminating Employee’s employment hereunder for Cause (x) Employee shall be
given written notice that Employer intends to terminate Employee’s employment
for Cause, which notice shall reasonably specify the grounds which are the
basis for the decision to terminate Employee’s employment for Cause, and (y) if
the conduct which constitutes the grounds is capable of being cured, in the
reasonable determination of the Board, Employee shall be given the opportunity
within thirty (30) calendar days of receipt of such notice to cure such
conduct, provided Employee has advised Employer in writing within five (5)
calendar days of receipt of such notice of Employee’s intention to cure such
conduct.  If the Board determines that
Employee has not cured, on or prior to the expiration of such thirty (30) day
period, Employee shall be terminated for Cause at the expiration of such thirty
(30) day period.  Notwithstanding the
foregoing, if Employee receives more than two (2) notices relating to the same
or similar conduct pursuant to this Section 15, or if such notices are sent
within forty (40) days of one another and relate to the same or similar
conduct, Employee shall no longer have the opportunity to cure and the
termination of employment for Cause shall be effective upon the receipt of such
notice. If Employee is a member of the Board, Employee hereby recuses himself
from the deliberations and vote of the Board regarding such subject matter.

 

16.                                 Termination by
Employer other than for Cause; Termination by Employee for Good Reason.  Employer may, at any time, terminate
Employee’s employment hereunder without Cause by delivering a written notice of
termination.  Employee may, with thirty
(30) days’ prior written notice to Employer, terminate Employee’s employment
hereunder for Good Reason (as defined below). Such notice shall reasonably specify
the grounds for Employee’s decision to terminate employment for Good Reason. If
Employer shall terminate Employee’s employment hereunder other than for (x)
Cause, (y) death or (z) Disability or if Employee terminates Employee’s
employment hereunder for Good Reason, then Employee shall have no right to
receive any compensation or benefit hereunder or otherwise from any member of
the Employer Group on and after the effective date of termination of employment
other than (1) Base Salary payments to the third anniversary of the Closing
Date, to the extent unpaid at the date of termination and paid in accordance
with Employer’s scheduled payroll practices, (2) any earned but unpaid bonus
then payable to Employee (which shall be paid on Employer’s next scheduled
payroll date), (3) business expense reimbursement pursuant to Section 6, and
(4) continued coverage, at no cost to Employee or his then covered dependents,
under Employer’s health and insurance programs until the third anniversary of
the Closing Date; provided, however, that (a) if such continued coverage is not
permitted under the terms of such plans, then Employer shall provide Employee
and his dependents substantially similar coverage and (b) if Employee becomes
eligible for health and insurance coverage from a new employer (and any benefits
received by or made available to Employee shall be reported by Employee to
Employer), then Employer’s obligations pursuant to this clause (4) shall cease.
The payments and benefits to be provided pursuant to this Section 16 upon
termination of Employee’s employment shall constitute the exclusive payments

 

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in the nature of severance, termination pay or salary continuation
which shall be due to the Employee and shall be in lieu of any other such
payments or benefits under any plan, program, policy or arrangement which has
heretofore been or shall hereafter be established by any member of the Employer
Group.  For purposes of this Section 16,
Good Reason is defined as (a) the failure of Employer to pay Employee any
compensation due to Employee or (b) a material reduction in the scope of duties
or responsibilities of Employee that have not been agreed to by Employee.  Employee shall provide Employer with a
period of ten (10) business days to cure the conduct that constitutes Good
Reason.

 

17.                                 Termination by
Employee other than for Good Reason. 
Employee may terminate Employee’s employment hereunder without Good
Reason upon thirty (30) days’ prior written notice to Employer. If Employee
shall terminate his employment other than for (x) Good Reason, (y) death or (z)
Disability, Employee shall have no right to receive any compensation or benefit
hereunder or otherwise from any member of the Employer Group on and after the
effective date of termination of employment other than (1) unpaid Base Salary
earned to the date of termination of employment (which shall be paid on
Employer’s next scheduled payroll date), (2) any earned but unpaid bonus then
payable to Employee (which shall be paid on Employer’s next scheduled payroll
date), (3) business expense reimbursement pursuant to Section 6 and (4)
benefits provided pursuant to Section 5, subject to the terms and conditions
applicable thereto.

 

18.                                 Release; Full
Satisfaction.  Notwithstanding any
provision in Section 16 hereof, no payments or benefits shall be provided
pursuant to Section 16 or Section 14 upon a termination of employment for
Disability that are in addition to the payments or benefits that would be
provided pursuant to Section 17, unless and until Employee executes and
delivers a standard form of general release of claims, and such release has
become irrevocable; provided, however, that Employee shall not be required to
release any indemnification rights or continuing rights to benefits under
Employer’s benefit plans, in accordance with the terms and conditions of such
plans.

 

19.                                 Cooperation
Following Termination.  Following
termination of employment of Employee’s employment hereunder for any reason,
Employee agrees to reasonably cooperate with Employer upon the reasonable
request of the Board and to be reasonably available to Employer with respect to
matters arising out of Employee’s services to any member of the Employer
Group.  Employer shall reimburse, or at
Employee’s request, advance Employee for expenses reasonably incurred in
connection with such matters.

 

20.                                 Interpretation;
Each Party the Drafter.  THIS
AGREEMENT IS THE PRODUCT OF EXTENSIVE DISCUSSIONS AND NEGOTIATIONS BETWEEN THE
PARTIES.  EACH OF THE PARTIES WAS
REPRESENTED BY OR HAD THE OPPORTUNITY TO CONSULT WITH COUNSEL WHO EITHER
PARTICIPATED IN THE FORMULATION AND DOCUMENTATION OF, OR WAS AFFORDED THE
OPPORTUNITY TO REVIEW AND PROVIDE COMMENTS ON, THIS AGREEMENT.  ACCORDINGLY,
THIS AGREEMENT AND THE PROVISIONS CONTAINED IN IT SHALL NOT BE CONSTRUED OR
INTERPRETED FOR OR AGAINST ANY PARTY TO THIS AGREEMENT BECAUSE THAT PARTY

 

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DRAFTED OR CAUSED THAT PARTY’S LEGAL REPRESENTATIVE TO DRAFT ANY OF ITS
PROVISIONS.

 

21.                                 Indemnification.  Employer shall indemnify Employee to the
fullest extent permitted by Nevada law and the articles of incorporation and
bylaws of the Employer.  Such
indemnification shall include, without limitation, the following:

 

a.                                       Indemnification Involving Third
Party Claims.    Employer shall indemnify Employee if Employee is a party to or is
threatened to be made a party to or otherwise involved in any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (each a “Claim”), other than a Claim by
or in the name of Employer or any entity in the Employer Group, by reason of
the fact that Employee is or was serving as an officer, director, employee or
agent of Employer or any entity in the Employer Group, or is or was serving at
the request of Employer as an officer, director, employee or agent of another
corporation, partnership, joint venture, trust or otherwise (each an “Indemnifiable
Event”), against all expenses, including attorneys’ fees, judgments, fines,
and amounts paid in settlement (collectively, “Expenses”) actually and
reasonably incurred by Employee in connection with the investigation, defense,
settlement or appeal of such Claim, if Employee either is not liable pursuant
to NRS Section 78.138 or acted in good faith and in a manner Employee
reasonably believed to be in or not opposed to the best interests of Employer
and, in the case of a criminal Claim, in addition had no reasonable cause to
believe that his conduct was unlawful.

 

b.                                      Indemnity in Derivative Actions. 
Employer shall indemnify Employee if Employee is a party to or
threatened to be made a party to or otherwise involved in any Claim by or in
the name of Employer to procure a judgment in its favor by reason of an Indemnifiable
Event, against all Expenses actually and reasonably incurred by Employee in
connection with the investigation, defense, settlement or appeal of such Claim,
but only if Employee is not liable pursuant to NRS Section 78.138 or acted in
good faith and in a manner he or she reasonably believed to be in or not
opposed to the best interest of Employer, except that no indemnification under
this Section 21(b) shall be made for any Claim, issue or matter to which the
Employee has been adjudged by a court of competent jurisdiction, after the exhaustion
of all appeals therefrom, to be liable to Employer or any entity in the
Employer Group or for amounts paid in settlement to any entity in the Employer
Group, unless and only to the extent that any court in which such Claim is
brought or other court of competent jurisdiction determines upon application
that, in view of all the circumstances of the case, Employee is fairly and
reasonably entitled to indemnification for such amounts as the court shall deem
proper.

 

c.                                       Determination of Appropriateness of
Indemnification.  Notwithstanding the foregoing, the
obligations of Employer under Sections 21(a) and 21(b) shall be subject to the
condition that, unless ordered by a court or advanced pursuant to Section 21(d)
below, a determination shall have been made that indemnification is

 

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proper under the specific circumstances
pursuant to and in accordance with NRS Section 78.751, as in effect from time
to time.

 

d.                                      Advancement of Expenses. 
Employer shall pay the Expenses of Employee as they are incurred and in
advance of the final disposition of a Claim (an “Expense Advance”).  Any Expense Advance to be made hereunder
shall be paid by Employer to Employee as soon as practicable, but in any event
no later than twenty (20) business days after written demand by Employee
therefor to Employer.  Notwithstanding
the foregoing, if Employee is an officer or director of Employer, the
obligation of Employer to make an Expense Advance shall be conditioned upon
receipt by Employer of an undertaking by or on behalf of Employee to repay the
amount advanced if it is ultimately determined by a court of competent
jurisdiction (in a final judicial determination as to which all rights of
appeal have been exhausted or lapsed) that Employee is not entitled to be
indemnified by Employer.

 

e.                                       Mandatory Payment of Expenses. 
Notwithstanding any other provision of this Agreement, to the extent
that Employee has been successful on the merits or otherwise, including,
without limitation, the dismissal of an action without prejudice, in defense of
any Claim regarding any Indemnifiable Event, Employee shall be indemnified
against all Expenses actually and reasonably incurred by Employee in connection
therewith.

 

f.                                         Indemnification for Defense Only. 
The indemnification authorized by this Section 21 does not include any
actions, suits or proceedings initiated by Employee against Employer or any
entity in the Employer Group.

 

g.                                      Settlement of Claims. 
Neither Employee nor Employer shall settle any Claim without the prior
written consent of the other (such consent not to be unreasonably withheld or
delayed).

 

22.                                 Severability.  If any provision hereof is unenforceable,
illegal, or invalid for any reason whatsoever, such fact shall not affect the remaining
provisions hereof, except in the event a law or court decision, whether on
application for declaration, or preliminary injunction or upon final judgment,
declares one or more of the provisions of this Agreement that impose
restrictions on Employee unenforceable or invalid because of the geographic
scope or time duration of such restriction. 
In such event, Employer shall have the option:

 

(A)                              To
deem the invalidated restrictions retroactively modified to provide for the
maximum geographic scope and time duration that would make such provisions
enforceable and valid; or

 

(B)                                To
terminate this Agreement pursuant to Section 15.

 

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Exercise of
any of these options shall not affect Employer’s right to seek damages or such
additional relief as may be allowed by law in respect to any breach by Employee
of the enforceable provisions of this Agreement.

 

23.                                 Survival.  Notwithstanding anything in this Agreement
to the contrary, to the extent applicable, Sections 12 through and including
Section 23 shall survive the termination of this Agreement.

 

24.                                 Notice.   For purposes of this Agreement, notices and
all other communications provided for in this Agreement shall be in writing and
shall be deemed to have been duly given (i) when personally delivered, (ii) the
business day following the day when deposited with a reputable and established
overnight express courier (charges prepaid), or (iii) five (5) days following
mailing by certified or registered mail, postage prepaid and return receipt
requested.  Unless another address is
specified, notices shall be sent to the addresses indicated below:

 

To Employer:

 

Poster Financial Group,
Inc.

2960 West Sahara, Suite
200

Las Vegas, Nevada 89102

 

With a copy to:

 

Skadden, Arps, Slate,
Meagher & Flom LLP

Four Times Square

New York, New York 10036

Attention:     Wallace L. Schwartz, Esq.

Howard L. Ellin, Esq.

 

To Employee:

 

Timothy Poster

One Hughes Center Drive,
#1501

Las Vegas, Nevada  89109

 

or to such other
address as either party shall have furnished to the other in writing in
accordance herewith.

 

25.                                 Tax Withholding.  Notwithstanding any other provision of this
Agreement, Employer may withhold from any amounts payable under this Agreement,
or any other benefits received pursuant hereto, such Federal, state, local and
other taxes as shall be required to be withheld under any applicable law or
regulation.

 

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26.                                 Dispute Resolution.

 

a.                                       Any dispute, claim or controversy
arising from or related in any way to this Agreement or the interpretation,
application, breach, termination or validity thereof, including any claim of
inducement of this Agreement by fraud, or arising from or related in any way to
Employee’s employment with Employer will be submitted for final resolution by
arbitration pursuant to the CPR Institute for Dispute Resolution Rules for
Non-Administered Arbitration except where those rules conflict with these
provisions, in which case these provisions control; provided, however,
that Employer shall have the right to seek equitable relief, including a
temporary restraining order, preliminary or permanent injunction or an
injunction in aid of arbitration, to enforce its rights set forth in Section
12.  The arbitration will be held in Las
Vegas, Nevada.

 

b.                                      The panel shall consist of three
neutral and impartial arbitrators, one chosen by the claimant from the CPR
Panel of Distinguished Neutrals and one chosen by the respondent from the CPR
Panel of Distinguished Neutrals within thirty days of receipt by respondent of
the demand for arbitration.  The two
arbitrators so selected shall have thirty days from the selection of the second
arbitrator to agree on a third arbitrator from the CPR Employment Panel for the
West Region who shall serve as chair of the arbitral tribunal.  If the two party-appointed arbitrators fail
to timely agree, the third arbitrator shall be selected by the CPR from the CPR
Employment Panel for the West Region.

 

c.                                       The arbitrators shall provide for
discovery, giving recognition to the understanding of the parties hereto that
they contemplate reasonable discovery, including document demands and
depositions.  In no event will the
arbitrators, absent agreement of the parties, allow more than a total of ten (10)
days for the hearing or permit either side to obtain more than a total of forty
(40) hours of deposition testimony from all witnesses, including both fact and
expert witnesses, or serve more than twenty (20) individual requests for
documents, including subparts. Multiple hearing days will be scheduled
consecutively to the greatest extent possible.

 

d.                                      The arbitrators must render their
award following the substantive law of the State of Nevada.  The arbitrators shall render an opinion
setting forth findings of fact and conclusions of law with the reasons
therefore stated.  A transcript of the
evidence adduced at the hearing shall be made and shall, upon request, be made
available to either party.  The
arbitrators shall have the power to exclude evidence on grounds of hearsay,
prejudice beyond its probative value, redundancy, or irrelevance and no award
shall be overturned by reason of such ruling on evidence.  The award shall be final and binding on the
parties and may be enforced in any court having jurisdiction.

 

12

 

e.                                       To the extent possible, the
arbitration hearings and award will be maintained in confidence, except as may
be required by law or for the purpose of enforcement of an arbitral award.

 

f.                                         Each party shall bear its own costs
and expenses incurred in connection with arbitration proceedings pursuant to
this Agreement to arbitrate.  The costs
and expenses of the arbitrators and related expenses shall be shared equally
between Employer, on one hand, and Employee on the other hand.

 

g.                                      EACH PARTY HERETO
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY CLAIM TO PUNITIVE OR
EXEMPLARY OR LIQUIDATED OR MULTIPLIED DAMAGES FROM THE OTHER.

 

27.                                 No Waiver of Breach
or Remedies.  No failure or delay on
the part of Employer or Employee in exercising any right, power or remedy
hereunder shall operate as a waiver thereof nor shall any single or partial
exercise of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy
hereunder.  The remedies herein provided
are cumulative and not exclusive of any remedies provided by law.

 

28.                                 Amendment or
Modification.  No amendment,
modification, termination or waiver of any provision of this Agreement shall be
effective unless the same shall be in writing and signed by a member of the
Board (other than Employee), and Employee, nor consent to any departure by the
Employee from any of the terms of this Agreement shall be effective unless the
same is signed by a member of the Board (other than Employee).  Any such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.

 

29.                                 Governing Law;
Venue.  The laws of the State of
Nevada shall govern the validity, construction and interpretation of this
Agreement, without regard to conflict of law principles. Each party irrevocably
submits to the exclusive jurisdiction of the United States District Court for
the District of Nevada or any court of the State of Nevada located in Clark
County in any action, suit or proceeding arising out of or relating to this
Agreement or any matters contemplated hereby, and agrees that any such action,
suit or proceeding shall be brought only in such court.

 

30.                                 Headings.  The headings in this Agreement have been
included solely for convenience of reference and shall not be considered in the
interpretation or construction of this Agreement.

 

31.                                 Assignment.  This Agreement is personal to Employee and
may not be assigned by Employee.

 

32.                                 Successors and
Assigns.  This Agreement may be
assigned by Employer to its successors and shall be binding upon the successors
and assigns of Employer.

 

13

 

33.                                 Prior Agreements.  This Agreement shall supersede and replace
any and all other prior discussions and negotiations as well as any and all
agreements and arrangements that may have been entered into by and between any
member of the Employer Group or any predecessor thereof, on the one hand, and
Employee, on the other hand, prior to the Closing Date relating to the subject
matter hereof.  Employee acknowledges
that all rights under such prior agreements and arrangements shall be
extinguished effective as of the Closing Date.

 

THE
REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

 

14

 

IN
WITNESS WHEREOF, Employer and Employee have entered into this
Agreement in Las Vegas, Nevada, as of the date first written above.

 

 

	
  EMPLOYEE:

  	
   

  	
  /s/ TIMOTHY POSTER

  
	
   

  	
   

  	
  Timothy Poster

  

 

	
   

  	
   

  	
   

  
	
  POSTER FINANCIAL GROUP, INC.

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ THOMAS BREITLING

  	
   

  
	
   

  	
  Name: Thomas Breitling

  	
   

  
	
   

  	
  Title:   President, Secretary and
  Treasurer

  	
   

  
				

 

15Exhibit 10.27

 

EMPLOYMENT AGREEMENT

 

This Employment Agreement
(this “Agreement”) is entered into as of October 13, 2003 by and between
Poster Financial Group, Inc. (“Employer”), and Thomas Breitling (“Employee”).

 

1.                                       Employment.  Employer hereby employs
Employee, and Employee hereby accepts employment by the Employer, as Employer’s
President, Secretary and Treasurer to perform such executive, managerial or
administrative duties, commensurate with Employee’s position, as Employer’s
Board of Directors (the “Board”) may specify from time to time, during the
Specified Term (as defined in Section 2).

 

2.                                       Effective Date; Specified Term.  This Agreement shall be effective on the Closing Date as such term
is defined in the Stock Purchase Agreement, dated as of June 24, 2003 (the
“Stock Purchase Agreement”), by and among MGM MIRAGE, Mirage Resorts,
Incorporated, GNLV, CORP., GNL CORP., Golden Nugget Experience, LLC and
Employer.  Subject to earlier
termination as provided herein, the term of the Employee’s employment hereunder
shall commence on the Closing Date and terminate on the third anniversary
thereof (the “Specified Term”). If Employee remains employed by Employer
following the Specified Term, any such employment shall be on an at will basis
unless the parties agree in writing to extend the Specified Term.  This Agreement shall be null and void and of
no force and effect if the Closing, as such term is defined in the Stock
Purchase Agreement, does not occur.

 

3.                                       Base
Salary.  During the Specified
Term, in consideration of the performance by Employee of Employee’s obligations
hereunder to Employer and its parents, subsidiaries, affiliates and joint
ventures (collectively, the “Employer Group”), in any capacity (including any
service as a director), Employer shall pay Employee an annual base salary of
not less than $500,000 (the “Base Salary”). 
The Base Salary shall be payable in accordance with the payroll
practices of Employer as in effect from time to time for Employer’s senior
executives.

 

4.                                       Bonus
Compensation.  Employee
shall be eligible to receive such annual or other bonuses as may be determined
in the sole discretion of the Board.

 

5.                                       Employee Benefit Programs. 
During the Specified Term, Employee shall be entitled to participate in
Employer’s employee benefit plans as are generally made available from time to
time to Employer’s senior executives, subject to the terms and conditions of
such plans, and subject to Employer’s right to amend, terminate or take other
similar actions with respect to such plans.

 

6.                                       Business Expense Reimbursements. 
Employer will pay or reimburse Employee for all reasonable out-of-pocket
expenses, including travel expenses, Employee incurs during the Specified Term
in the course of performing Employee’s duties under this Agreement upon timely
submission of appropriate documentation to Employer, as prescribed from time to
time by Employer.

 

1

 

7.                                       Car Allowance.  During the Specified Term, Employer shall
provide Employee with a monthly car allowance of $2,000.

 

8.                                       Extent of
Services.   Employee agrees that the duties and services
to be performed by Employee shall be performed exclusively for members of the
Employer Group.  Employee further agrees
to perform such duties in an efficient, trustworthy and businesslike
manner.  Employee agrees not to render
to others any service of any kind whether or not for compensation, or to engage
in any other business activity whether or not for compensation, that is similar
to or conflicts with the performance of Employee’s duties under this Agreement,
without the written approval of the Board.

 

9.                                       Policies and Procedures. 
In addition to the terms herein, Employee agrees to be bound by
Employer’s policies and procedures as they may be amended by Employer from time
to time.  In the event the terms in this
Agreement conflict with Employer’s policies and procedures, the terms herein
shall take precedence.  Employer
recognizes that it has a responsibility to see that its employees understand
the adverse effects that problem gambling and underage gambling can have on
individuals and the gaming industry as a whole.  Employee acknowledges having read Employer’s policies, procedures
and manuals and agrees to abide by the same, including but not limited to
Employer’s policy of prohibiting underage gaming and supporting programs to
treat compulsive gambling.

 

10.                                 Licensing Requirements. 
Employee acknowledges that Employer is engaged in a business that is or
may be subject to and exists because of privileged licenses issued by
governmental authorities in Nevada and other jurisdictions in which Employer is
engaged or has applied or during the Specified Term may apply to engage in the
gaming business.  If requested to do so
by Employer, Employee shall apply for and obtain any license, qualification,
clearance or the like which shall be requested or required of Employee by any
regulatory authority having jurisdiction over Employer.

 

11.                                 Failure to Satisfy
Licensing Requirement.  If Employee
fails to satisfy any licensing requirement referred to in Section 10
above, or if any governmental authority directs the Employer to terminate any
relationship it may have with Employee, or if Employer shall determine, in
Employer’s sole and exclusive judgment, that Employee was, is or might be
involved in, or is about to be involved in, any activity, relationship(s) or
circumstance which could or does jeopardize Employer’s business, reputation or
such licenses, or if any such license is threatened to be, or is, denied,
curtailed, suspended or revoked, this Agreement may be terminated by Employer
and the parties’ obligations and responsibilities shall be determined by the
provisions of Section 15.

 

12.                                 Restrictive
Covenants.

 

a.                                       Competition. 
Employee acknowledges that, in the course of Employee’s responsibilities
hereunder, Employee will form relationships and become acquainted with certain
confidential and proprietary information as further described in
Section 12(b).  Employee further
acknowledges that such relationships and information are and will remain
valuable to the Employer Group

 

2

 

and that the
restrictions on future employment, if any, are reasonably necessary in order
for Employer to remain competitive in the gaming industry.  In recognition of Employer’s heightened need
for protection from abuse of relationships formed or information garnered
before and during the Specified Term of the Employee’s employment hereunder,
Employee covenants and agrees for the twelve (12) month period immediately
following termination of employment for any reason, unless such employment is
terminated by Employer without Cause or by Employee for Good Reason (as such
terms are defined below) (the “Restrictive Period”), not to directly or
indirectly be employed by, provide consultation or other services to, engage or
participate in, provide advice, information or assistance to, fund or invest
in, or otherwise be connected or associated in any way or manner with, any
firm, person, corporation or other entity which is either directly, indirectly
or through an affiliated company or entity, engaged in gaming or proposes to
engage in gaming in the State of Nevada, or in or within a 150 mile radius of
any other jurisdiction in which any member of the Employer Group during the
Restrictive Period is engaged in gaming or proposes to engage in gaming
(“Competitor”).  The covenants under
this Section 12(a) include but are not limited to Employee’s covenant not
to:

 

i.                                          Make known to any third party the
names and addresses of any of the customers of any member of the Employer
Group, or any other information pertaining to those customers;

 

ii.                                       Call on, solicit, induce to leave
and/or take away, or attempt to call on, solicit, induce to leave and/or take
away, any of the customers of any member of the Employer Group, either for
Employee’s own account or for any third party;

 

iii.                                    Call on, solicit and/or take away,
any potential or prospective customer of any member of the Employer Group, on
whom the Employee called or with whom Employee became acquainted during
employment (either before or during the Specified Term) by any member of the
Employer Group, either for Employee’s own account or for any third party; and

 

iv.                                   Approach or solicit any employee or
independent contractor of any member of the Employer Group with a view towards
enticing such person to leave the employ or service of any member of the
Employer Group, or hire or contract with any employee or independent contractor
of any member of the Employer Group, without the prior written consent of the
Employer, such consent to be within Employer’s sole and absolute discretion.

 

b.                                      Confidentiality. 
Employee covenants and agrees that Employee shall not at any time during
the Specified Term or thereafter, without Employer’s prior written consent,
such consent to be within Employer’s sole and absolute discretion, disclose or
make known to any person or entity outside of the Employer Group

 

3

 

any Trade Secret (as
defined below), or proprietary or other confidential information concerning any
member of the Employer Group, including without limitation, Employer’s
customers and its casino, hotel and marketing practices, procedures, management
policies or any other information regarding any member of the Employer Group
which is not already and generally known to the public through no wrongful act
of Employee or any other party. 
Employee covenants and agrees that Employee shall not at any time during
the Specified Term, or thereafter, without the Employer’s prior written
consent, utilize any such Trade Secrets, proprietary or confidential
information in any way, including communications with or contact with any such
customer other than in connection with employment hereunder.  Not by way of limitation but by way of
illustration, Employee agrees that such Trade Secrets, proprietary or
confidential information specifically include, but are not limited to, any
documents or reports prepared by Employee in connection with the performance of
his duties hereunder. For purposes of this Section 12, Trade Secrets is
defined as information (including, but not limited to, all information,
materials or terms included within the Nevada Revised Statutes (“NRS”)),
including a formula, pattern, compilation, program, device, method, know-how,
technique or process, that derives economic value, present or potential, from
not being generally known to, and not being readily ascertainable by proper
means by, other persons who may or could obtain any economic value from its
disclosure or use.

 

c.                                       Former Employer Information. 
Employee will not intentionally, during the Specified Term, improperly
use or disclose any proprietary information or Trade Secrets of any former
employer or other person or entity and will not bring onto the premises of the
Employer any unpublished document or proprietary information belonging to any
such employer, person or entity unless consented to in writing by such
employer, person or entity.

 

d.                                      Third Party Information. 
Employee acknowledges that Employer and other members of the Employer
Group have received and in the future will receive from third parties their
confidential or proprietary information subject to a duty to maintain the
confidentiality of such information and to use it only for certain limited
purposes.  Employee will hold all such
confidential or proprietary information in the strictest confidence and will
not disclose it to any person or entity or to use it except as necessary in
carrying out Employee’s duties hereunder consistent with Employer’s (or such
other member of the Employer Group’s) agreement with such third party.

 

e.                                       Employer’s Property. 
Employee hereby confirms that Trade Secrets, proprietary or confidential
information and all information concerning customers who utilize the goods,
services or facilities of any hotel and/or casino owned, operated or managed by
Employer constitute Employer’s exclusive property (regardless of whether
Employee possessed or claims to have possessed such information prior to the
date hereof).  Employee agrees that upon
termination of employment,

 

4

 

Employee shall
promptly return to the Employer all notes, notebooks, memoranda, computer
disks, and any other similar repositories of information (regardless of whether
Employee possessed such information prior to the date hereof) containing or
relating in any way to the Trade Secrets or proprietary or confidential
information of each member of the Employer Group, including but not limited to,
the documents referred to in Section 12(b).  Such repositories of information also include but are not limited
to any so-called personal files or other personal data compilations in any
form, which in any manner contain any Trade Secrets or proprietary or
confidential information of any member of the Employer Group.

 

f.                                         Notice to Employer. 
Employee agrees to notify Employer immediately of any employers for whom
Employee works or provides services (whether or not for remuneration to
Employee or a third party) during the Specified Term or within the Restrictive
Period.  Employee further agrees to
promptly notify Employer, during Employee’s employment with Employer, of any
contacts made by any gaming licensee which concern or relate to an offer of future
employment (or consulting services) to Employee.

 

13.                                 Representations.   Employee hereby represents, warrants and agrees with Employer
that:

 

a.                                       The covenants and agreements
contained in Sections 8 and 12 above are reasonable, appropriate and suitable in
their geographic scope, duration and content; the Employer’s agreement to
employ the Employee and a portion of the compensation and consideration to be
paid to Employee hereunder, is in partial consideration for such covenants and
agreements; the Employee shall not, directly or indirectly, raise any issue of
the reasonableness, appropriateness and suitability of the geographic scope,
duration or content of such covenants and agreements in any proceeding to
enforce such covenants and agreements;  and
such covenants and agreements shall survive the termination of this Agreement,
in accordance with their terms;

 

b.                                      The enforcement of any remedy under
this Agreement will not prevent Employee from earning a livelihood, because
Employee’s past work history and abilities are such that Employee can
reasonably expect to find work in other areas and lines of business;

 

c.                                       The covenants and agreements stated
in Sections 8, 10, 11 and 12 above are essential for the Employer’s reasonable
protection;

 

d.                                      Employer has reasonably relied on
these covenants and agreements by Employee; and

 

e.                                       Employee has the full right to enter
into this Agreement and by entering into and performance of this Agreement will
not violate or conflict with any arrangements or agreements Employee may have
or agreed to have with any other person or entity.

 

5

 

Additionally, Employee agrees that in the event of Employee’s breach or
threatened breach of any covenants and agreements set forth in Sections 8 and
12 above, Employer may seek to enforce such covenants and agreements through
any equitable remedy, including specific performance or injunction, without
waiving any claim for damages.  In any
such event, Employee waives any claim that the Employer has an adequate remedy
at law or for the posting of a bond.

 

14.                                 Termination for
Death or Disability.  Employee’s
employment hereunder shall terminate upon Employee’s death or Disability (as
defined below).  In the event of
Employee’s death or Disability, Employee (or Employee’s estate or beneficiaries
in the case of death) shall have no right to receive any compensation or
benefit hereunder or otherwise from any member of the Employer Group on and
after the effective date of termination of employment other than (1) unpaid
Base Salary earned to the date of termination of employment (which shall be
paid on Employer’s next scheduled payroll date), (2) any earned but unpaid
bonus then payable to Employee (which shall be paid on Employer’s next
scheduled payroll date), (3) business expense reimbursement pursuant to
Section 6, (4) benefits provided pursuant to Section 5, subject to
the terms and conditions applicable thereto and (5) continued Base Salary
payments for three (3) months from the date of termination of employment to be
paid in accordance with Employer’s scheduled payroll practices (in the case of
Disability, offset by amounts payable to Employee pursuant to any disability
plan sponsored by any member of the Employer Group). For purposes of this
Section 14, Disability is defined as Employee’s incapacity, certified by a
licensed physician selected by Employer (“Employer’s Physician”), which
precludes Employee from performing the essential functions of Employee’s duties
hereunder for a substantial portion of any consecutive period of six (6) months
or more.  In the event Employee
disagrees with the conclusions of the Employer’s Physician, Employee (or
Employee’s representative) shall designate a physician (“Employee’s Physician”),
and Employer’s Physician and Employee’s Physician shall jointly select a third
physician (“Third Physician”), who shall make the determination which
determination shall be final and binding on the parties hereto.  Employee hereby consents to any examination
or to provide or authorize access to any medical records that may be reasonably
required by Employer’s Physician or the Third Physician in connection with any
determination to be made pursuant to this Section 14.

 

15.                                 Termination by
Employer for Cause.  Employer may
terminate Employee’s employment hereunder for Cause (as defined below) at any
time.  If Employer terminates Employee’s
employment for Cause, Employee shall have no right to receive any compensation
or benefit hereunder or otherwise from any member of the Employer Group on and
after the effective date of termination of employment other than (1) unpaid
Base Salary earned to the date of termination of employment (which shall be
paid on Employer’s next scheduled payroll date), (2) business expense
reimbursement pursuant to Section 6, and (3) benefits provided pursuant to
Section 5, subject to the terms and conditions applicable thereto.  For purposes of this Section 15, Cause
is defined as Employee’s (a) failure to abide by Employer’s policies and
procedures, (b) misconduct, insubordination, or inattention to Employer’s
business, (c) failure to perform the duties required of Employee up to the

 

6

 

standards established by the Board, or other
material breach of this Agreement (other than as a result of a Disability), or
(d) failure or inability to satisfy the requirements stated in Section 11
above.  Notwithstanding the foregoing,
prior to terminating Employee’s employment hereunder for Cause (x) Employee
shall be given written notice that Employer intends to terminate Employee’s
employment for Cause, which notice shall reasonably specify the grounds which
are the basis for the decision to terminate Employee’s employment for Cause,
and (y) if the conduct which constitutes the grounds is capable of being cured,
in the reasonable determination of the Board, Employee shall be given the
opportunity within thirty (30) calendar days of receipt of such notice to cure
such conduct, provided Employee has advised Employer in writing within five (5)
calendar days of receipt of such notice of Employee’s intention to cure such
conduct.  If the Board determines that
Employee has not cured, on or prior to the expiration of such thirty (30) day
period, Employee shall be terminated for Cause at the expiration of such thirty
(30) day period.  Notwithstanding the
foregoing, if Employee receives more than two (2) notices relating to the same
or similar conduct pursuant to this Section 15, or if such notices are
sent within forty (40) days of one another and relate to the same or similar
conduct, Employee shall no longer have the opportunity to cure and the
termination of employment for Cause shall be effective upon the receipt of such
notice. If Employee is a member of the Board, Employee hereby recuses himself
from the deliberations and vote of the Board regarding such subject matter.

 

16.                                 Termination by
Employer other than for Cause; Termination by Employee for Good Reason.  Employer may, at any time, terminate
Employee’s employment hereunder without Cause by delivering a written notice of
termination.  Employee may, with thirty
(30) days’ prior written notice to Employer, terminate Employee’s employment
hereunder for Good Reason (as defined below). Such notice shall reasonably
specify the grounds for Employee’s decision to terminate employment for Good
Reason. If Employer shall terminate Employee’s employment hereunder other than
for (x) Cause, (y) death or (z) Disability or if Employee terminates Employee’s
employment hereunder for Good Reason, then Employee shall have no right to
receive any compensation or benefit hereunder or otherwise from any member of
the Employer Group on and after the effective date of termination of employment
other than (1) Base Salary payments to the third anniversary of the Closing
Date, to the extent unpaid at the date of termination and paid in accordance
with Employer’s scheduled payroll practices, (2) any earned but unpaid bonus
then payable to Employee (which shall be paid on Employer’s next scheduled
payroll date), (3) business expense reimbursement pursuant to Section 6,
and (4) continued coverage, at no cost to Employee or his then covered
dependents, under Employer’s health and insurance programs until the third
anniversary of the Closing Date; provided, however, that (a) if such continued
coverage is not permitted under the terms of such plans, then Employer shall
provide Employee and his dependents substantially similar coverage and (b) if
Employee becomes eligible for health and insurance coverage from a new employer
(and any benefits received by or made available to Employee shall be reported
by Employee to Employer), then Employer’s obligations pursuant to this clause
(4) shall cease. The payments and benefits to be provided pursuant to this
Section 16 upon termination of Employee’s employment shall constitute the
exclusive payments

 

7

 

in the nature of severance, termination pay
or salary continuation which shall be due to the Employee and shall be in lieu
of any other such payments or benefits under any plan, program, policy or
arrangement which has heretofore been or shall hereafter be established by any
member of the Employer Group.  For
purposes of this Section 16, Good Reason is defined as (a) the failure of
Employer to pay Employee any compensation due to Employee or (b) a material
reduction in the scope of duties or responsibilities of Employee that have not
been agreed to by Employee.  Employee
shall provide Employer with a period of ten (10) business days to cure the
conduct that constitutes Good Reason.

 

17.                                 Termination by
Employee other than for Good Reason. 
Employee may terminate Employee’s employment hereunder without Good
Reason upon thirty (30) days’ prior written notice to Employer. If Employee
shall terminate his employment other than for (x) Good Reason, (y) death or (z)
Disability, Employee shall have no right to receive any compensation or benefit
hereunder or otherwise from any member of the Employer Group on and after the
effective date of termination of employment other than (1) unpaid Base Salary
earned to the date of termination of employment (which shall be paid on
Employer’s next scheduled payroll date), (2) any earned but unpaid bonus then
payable to Employee (which shall be paid on Employer’s next scheduled payroll
date), (3) business expense reimbursement pursuant to Section 6 and (4)
benefits provided pursuant to Section 5, subject to the terms and
conditions applicable thereto.

 

18.                                 Release; Full
Satisfaction.  Notwithstanding any
provision in Section 16 hereof, no payments or benefits shall be provided
pursuant to Section 16 or Section 14 upon a termination of employment
for Disability that are in addition to the payments or benefits that would be
provided pursuant to Section 17, unless and until Employee executes and
delivers a standard form of general release of claims, and such release has
become irrevocable; provided, however, that Employee shall not be required to
release any indemnification rights or continuing rights to benefits under Employer’s
benefit plans, in accordance with the terms and conditions of such plans.

 

19.                                 Cooperation
Following Termination.  Following
termination of employment of Employee’s employment hereunder for any reason,
Employee agrees to reasonably cooperate with Employer upon the reasonable
request of the Board and to be reasonably available to Employer with respect to
matters arising out of Employee’s services to any member of the Employer
Group.  Employer shall reimburse, or at
Employee’s request, advance Employee for expenses reasonably incurred in
connection with such matters.

 

20.                                 Interpretation;
Each Party the Drafter.  THIS
AGREEMENT IS THE PRODUCT OF EXTENSIVE DISCUSSIONS AND NEGOTIATIONS BETWEEN THE
PARTIES.  EACH OF THE PARTIES WAS
REPRESENTED BY OR HAD THE OPPORTUNITY TO CONSULT WITH COUNSEL WHO EITHER
PARTICIPATED IN THE FORMULATION AND DOCUMENTATION OF, OR WAS AFFORDED THE
OPPORTUNITY TO REVIEW AND PROVIDE COMMENTS ON, THIS AGREEMENT.  ACCORDINGLY,
THIS AGREEMENT AND THE PROVISIONS CONTAINED IN IT SHALL NOT BE CONSTRUED OR
INTERPRETED FOR OR AGAINST ANY PARTY TO THIS AGREEMENT BECAUSE THAT PARTY

 

8

 

DRAFTED OR CAUSED THAT PARTY’S LEGAL
REPRESENTATIVE TO DRAFT ANY OF ITS PROVISIONS.

 

21.                                 Indemnification.  Employer shall indemnify Employee to the
fullest extent permitted by Nevada law and the articles of incorporation and
bylaws of the Employer.  Such
indemnification shall include, without limitation, the following:

 

a.                                       Indemnification Involving Third
Party Claims.    Employer shall indemnify Employee if Employee is a party to or is
threatened to be made a party to or otherwise involved in any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (each a “Claim”), other than a Claim by
or in the name of Employer or any entity in the Employer Group, by reason of
the fact that Employee is or was serving as an officer, director, employee or
agent of Employer or any entity in the Employer Group, or is or was serving at
the request of Employer as an officer, director, employee or agent of another
corporation, partnership, joint venture, trust or otherwise (each an “Indemnifiable
Event”), against all expenses, including attorneys’ fees, judgments, fines,
and amounts paid in settlement (collectively, “Expenses”) actually and
reasonably incurred by Employee in connection with the investigation, defense,
settlement or appeal of such Claim, if Employee either is not liable pursuant
to NRS Section 78.138 or acted in good faith and in a manner Employee
reasonably believed to be in or not opposed to the best interests of Employer
and, in the case of a criminal Claim, in addition had no reasonable cause to
believe that his conduct was unlawful.

 

b.                                      Indemnity in Derivative Actions. 
Employer shall indemnify Employee if Employee is a party to or
threatened to be made a party to or otherwise involved in any Claim by or in
the name of Employer to procure a judgment in its favor by reason of an Indemnifiable
Event, against all Expenses actually and reasonably incurred by Employee in
connection with the investigation, defense, settlement or appeal of such Claim,
but only if Employee is not liable pursuant to NRS Section 78.138 or acted
in good faith and in a manner he or she reasonably believed to be in or not
opposed to the best interest of Employer, except that no indemnification under
this Section 21(b) shall be made for any Claim, issue or matter to which
the Employee has been adjudged by a court of competent jurisdiction, after the
exhaustion of all appeals therefrom, to be liable to Employer or any entity in
the Employer Group or for amounts paid in settlement to any entity in the
Employer Group, unless and only to the extent that any court in which such
Claim is brought or other court of competent jurisdiction determines upon
application that, in view of all the circumstances of the case, Employee is
fairly and reasonably entitled to indemnification for such amounts as the court
shall deem proper.

 

c.                                       Determination of Appropriateness of
Indemnification.  Notwithstanding the foregoing, the
obligations of Employer under Sections 21(a) and 21(b) shall be subject to the
condition that, unless ordered by a court or advanced pursuant to
Section 21(d) below, a determination shall have been made that
indemnification is

 

9

 

proper under the
specific circumstances pursuant to and in accordance with NRS
Section 78.751, as in effect from time to time.

 

d.                                      Advancement of Expenses. 
Employer shall pay the Expenses of Employee as they are incurred and in
advance of the final disposition of a Claim (an “Expense Advance”).  Any Expense Advance to be made hereunder
shall be paid by Employer to Employee as soon as practicable, but in any event
no later than twenty (20) business days after written demand by Employee
therefor to Employer.  Notwithstanding
the foregoing, if Employee is an officer or director of Employer, the
obligation of Employer to make an Expense Advance shall be conditioned upon
receipt by Employer of an undertaking by or on behalf of Employee to repay the
amount advanced if it is ultimately determined by a court of competent
jurisdiction (in a final judicial determination as to which all rights of
appeal have been exhausted or lapsed) that Employee is not entitled to be
indemnified by Employer.

 

e.                                       Mandatory Payment of Expenses. 
Notwithstanding any other provision of this Agreement, to the extent
that Employee has been successful on the merits or otherwise, including,
without limitation, the dismissal of an action without prejudice, in defense of
any Claim regarding any Indemnifiable Event, Employee shall be indemnified
against all Expenses actually and reasonably incurred by Employee in connection
therewith.

 

f.                                         Indemnification for Defense Only. 
The indemnification authorized by this Section 21 does not include
any actions, suits or proceedings initiated by Employee against Employer or any
entity in the Employer Group.

 

g.                                      Settlement of Claims. 
Neither Employee nor Employer shall settle any Claim without the prior
written consent of the other (such consent not to be unreasonably withheld or
delayed).

 

22.                                 Severability.  If any provision hereof is unenforceable,
illegal, or invalid for any reason whatsoever, such fact shall not affect the
remaining provisions hereof, except in the event a law or court decision,
whether on application for declaration, or preliminary injunction or upon final
judgment, declares one or more of the provisions of this Agreement that impose
restrictions on Employee unenforceable or invalid because of the geographic
scope or time duration of such restriction. 
In such event, Employer shall have the option:

 

(A)                              To
deem the invalidated restrictions retroactively modified to provide for the
maximum geographic scope and time duration that would make such provisions
enforceable and valid; or

 

(B)                                To
terminate this Agreement pursuant to Section 15.

 

10

 

Exercise of any of these options shall not affect Employer’s right to
seek damages or such additional relief as may be allowed by law in respect to
any breach by Employee of the enforceable provisions of this Agreement.

 

23.                                 Survival.  Notwithstanding anything in this Agreement
to the contrary, to the extent applicable, Sections 12 through and including
Section 23 shall survive the termination of this Agreement.

 

24.                                 Notice.   For purposes of this Agreement, notices and
all other communications provided for in this Agreement shall be in writing and
shall be deemed to have been duly given (i) when personally delivered, (ii) the
business day following the day when deposited with a reputable and established
overnight express courier (charges prepaid), or (iii) five (5) days following
mailing by certified or registered mail, postage prepaid and return receipt
requested.  Unless another address is
specified, notices shall be sent to the addresses indicated below:

 

To Employer:

 

Poster Financial Group,
Inc.

2960 West Sahara, Suite
200

Las Vegas, Nevada 89102

 

With a copy to:

 

Skadden, Arps, Slate,
Meagher & Flom LLP

Four Times Square

New York, New York 10036

Attention:     Wallace L. Schwartz, Esq.

Howard L. Ellin, Esq.

 

To Employee:

 

Thomas Breitling

One Hughes Center Drive,
#1401

Las Vegas, Nevada  89109

 

or to
such other address as either party shall have furnished to the other in writing
in accordance herewith.

 

25.                                 Tax Withholding.  Notwithstanding any other provision of this
Agreement, Employer may withhold from any amounts payable under this Agreement,
or any other benefits received pursuant hereto, such Federal, state, local and
other taxes as shall be required to be withheld under any applicable law or
regulation.

 

11

 

26.                                 Dispute Resolution.

 

a.                                       Any dispute, claim or controversy
arising from or related in any way to this Agreement or the interpretation,
application, breach, termination or validity thereof, including any claim of
inducement of this Agreement by fraud, or arising from or related in any way to
Employee’s employment with Employer will be submitted for final resolution by
arbitration pursuant to the CPR Institute for Dispute Resolution Rules for
Non-Administered Arbitration except where those rules conflict with these
provisions, in which case these provisions control; provided, however,
that Employer shall have the right to seek equitable relief, including a
temporary restraining order, preliminary or permanent injunction or an
injunction in aid of arbitration, to enforce its rights set forth in
Section 12.  The arbitration will
be held in Las Vegas, Nevada.

 

b.                                      The panel shall consist of three
neutral and impartial arbitrators, one chosen by the claimant from the CPR
Panel of Distinguished Neutrals and one chosen by the respondent from the CPR
Panel of Distinguished Neutrals within thirty days of receipt by respondent of
the demand for arbitration.  The two
arbitrators so selected shall have thirty days from the selection of the second
arbitrator to agree on a third arbitrator from the CPR Employment Panel for the
West Region who shall serve as chair of the arbitral tribunal.  If the two party-appointed arbitrators fail
to timely agree, the third arbitrator shall be selected by the CPR from the CPR
Employment Panel for the West Region.

 

c.                                       The arbitrators shall provide for
discovery, giving recognition to the understanding of the parties hereto that
they contemplate reasonable discovery, including document demands and
depositions.  In no event will the
arbitrators, absent agreement of the parties, allow more than a total of ten
(10) days for the hearing or permit either side to obtain more than a total of
forty (40) hours of deposition testimony from all witnesses, including both
fact and expert witnesses, or serve more than twenty (20) individual requests
for documents, including subparts. Multiple hearing days will be scheduled
consecutively to the greatest extent possible.

 

d.                                      The arbitrators must render their
award following the substantive law of the State of Nevada.  The arbitrators shall render an opinion setting
forth findings of fact and conclusions of law with the reasons therefore
stated.  A transcript of the evidence
adduced at the hearing shall be made and shall, upon request, be made available
to either party.  The arbitrators shall
have the power to exclude evidence on grounds of hearsay, prejudice beyond its
probative value, redundancy, or irrelevance and no award shall be overturned by
reason of such ruling on evidence.  The
award shall be final and binding on the parties and may be enforced in any court
having jurisdiction.

 

12

 

e.                                       To the extent possible, the
arbitration hearings and award will be maintained in confidence, except as may
be required by law or for the purpose of enforcement of an arbitral award.

 

f.                                         Each party shall bear its own costs
and expenses incurred in connection with arbitration proceedings pursuant to
this Agreement to arbitrate.  The costs
and expenses of the arbitrators and related expenses shall be shared equally
between Employer, on one hand, and Employee on the other hand.

 

g.                                      EACH PARTY HERETO
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY CLAIM TO PUNITIVE OR
EXEMPLARY OR LIQUIDATED OR MULTIPLIED DAMAGES FROM THE OTHER.

 

27.                                 No Waiver of Breach
or Remedies.  No failure or delay on
the part of Employer or Employee in exercising any right, power or remedy
hereunder shall operate as a waiver thereof nor shall any single or partial
exercise of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy
hereunder.  The remedies herein provided
are cumulative and not exclusive of any remedies provided by law.

 

28.                                 Amendment or
Modification.  No amendment,
modification, termination or waiver of any provision of this Agreement shall be
effective unless the same shall be in writing and signed by a member of the
Board (other than Employee), and Employee, nor consent to any departure by the
Employee from any of the terms of this Agreement shall be effective unless the
same is signed by a member of the Board (other than Employee).  Any such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.

 

29.                                 Governing Law;
Venue.  The laws of the State of
Nevada shall govern the validity, construction and interpretation of this
Agreement, without regard to conflict of law principles. Each party irrevocably
submits to the exclusive jurisdiction of the United States District Court for
the District of Nevada or any court of the State of Nevada located in Clark
County in any action, suit or proceeding arising out of or relating to this
Agreement or any matters contemplated hereby, and agrees that any such action,
suit or proceeding shall be brought only in such court.

 

30.                                 Headings.  The headings in this Agreement have been
included solely for convenience of reference and shall not be considered in the
interpretation or construction of this Agreement.

 

31.                                 Assignment.  This Agreement is personal to Employee and
may not be assigned by Employee.

 

32.                                 Successors and
Assigns.  This Agreement may be
assigned by Employer to its successors and shall be binding upon the successors
and assigns of Employer.

 

13

 

33.                                 Prior Agreements.  This Agreement shall supersede and replace
any and all other prior discussions and negotiations as well as any and all
agreements and arrangements that may have been entered into by and between any
member of the Employer Group or any predecessor thereof, on the one hand, and
Employee, on the other hand, prior to the Closing Date relating to the subject
matter hereof.  Employee acknowledges
that all rights under such prior agreements and arrangements shall be
extinguished effective as of the Closing Date.

 

THE REMAINDER OF THIS PAGE HAS BEEN
INTENTIONALLY LEFT BLANK.

 

14

 

IN WITNESS WHEREOF, Employer and Employee
have entered into this Agreement in Las Vegas, Nevada, as of the date first
written above.

 

 

	
  EMPLOYEE:

  	
  /s/ THOMAS BREITLING

  	
   

  
	
   

  	
  Thomas Breitling

  
	
   

  	
   

  
	
   

  	
   

  
	
  POSTER FINANCIAL GROUP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Tim Poster

  	
   

  
	
   

  	
  Name:

  	
  Tim Poster

  
	
   

  	
  Title:

  	
  Chief Executive Officer

  
					

 

15

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