Document:

Exhibit
10.29

 

Alliance
Gaming

Corporation

 

	
   

  	
   

  	
  ROBERT L. MIODUNSKI

  
	
  March 2, 2004

  	
   

  	
  President and

  
	
   

  	
   

  	
  Chief Executive Officer

  

 

Robert Luciano

 

RE: Employment Agreement

 

Dear Mr. Luciano:

 

Bally Gaining, Inc. (“Bally”), is
pleased to offer you employment for Sierra Design Group under the following
terms and conditions effective on March 2, 2004 (the “Effective Date”).
This offer is not intended to, and if accepted it will not, create an agreement
of employment for any specific term or otherwise alter the at-will nature of
your employment relationship with Bally. Either you or Bally may terminate your
employment at any time with or without cause.

 

Position and Title. Your current
position, title, and duties will be: Executive Vice President of Bally and
President of Sierra Design Group, reporting to the President of Bally, duties
generally including all management and supervision of Sierra Design Group’s
systems business unit and product groups and any other related duties the
president of Bally may assign to you.

 

Salary. Your annual base
salary will be $250,000 beginning on the Effective Date. Your base salary will
be reviewed annually and adjustment may be made at Bally’s option based on
merit.

 

Signing Bonus. You will receive a
one-time $50,000 signing bonus on the Effective Date.

 

Annual Bonus. You will receive a
$50,000 bonus payable on each anniversary of the Effective Date that you remain
employed by Bally.

 

Salary Continuation. If your employment
is terminated without cause after the Effective Date, you will continue to
receive your base salary on normal paydays until one year after the termination
date (the “Salary Continuation Period”), less standard withholding.
Please note that this salary continuation will not apply if Bally terminates
you for cause or if you terminate your employment for any reason at any time.

 

Management Incentive
Program. You will be entitled to participate in Bally’s Management Incentive
Program established for Sierra Design Group at the level of business unit head.
Under this incentive plan you will be eligible to receive, at the discretion of
the board of directors of

 

 

Bally, up to 100% of your base salary at
performance of 20% above plan. The “at plan” incentive is 50% of base salary.
The “at plan” targets for EBITDA and Operating Income for the periods through June 30
2007 shall be per the attached Exhibit A, Exhibit B and
Exhibit C. Bally reserves the right to modify this plan at its sole
discretion after June 30, 2007.

 

MIP Continuation. If your employment
is terminated without cause, you will receive “MIP Continuation” as follows.
The Management Incentive Plan fiscal year performance factors shall be
determined as of the end of the month immediately preceding the date of
termination. The results shall then be annualized for the remainder of the
fiscal year. Your MIP Continuation shall be the amount you would have received
for the entire fiscal year based on the annualized results. For example and
without limitation, if your employment is terminated without cause on January 15,
2006; the MIP performance factors would be determined for the fiscal
year-to-date through December 31, 2005, the result would be annualized (in
the case of the example, multiplied by two because the performance factors were
measured for half the fiscal year), and the appropriate bonus based on the
annualized amount would be calculated pursuant to the MIP, and this amount (the
“MIP Continuation Amount”) would be paid to you at the time other
payments are disbursed for the fiscal year in question under the Management
Incentive Plan. In addition, in the event Bally extends your Non-Compete Period
as set forth below, Bally shall also pay you the MIP Continuation Amount for
the extension period at the time other payments are disbursed for the fiscal
year in question under the Management Incentive Plan.

 

The foregoing terms are contingent on you
agreeing to and complying with the following:

 

Covenant not to compete. You agree not to
compete with Bally for as long as you are employed by Bally. You agree not to
compete with Bally for one year after your employment with Bally ends, if Bally
terminates you for cause or if you quit for any reason (the “Non-Compete
Period”). Notwithstanding the foregoing agreement with respect to the
Non-Compete Period, you also agree, as part of the terms and conditions of that
certain Stock Purchase Agreement, dated November 10, 2003, by and among
Alliance, Sierra Design Group, you and your trust, and as a separate and
independent covenant, not to compete with Bally and any of its affiliates for a
period of three and one half years from the Effective Date.

 

For purposes of this offer and your subsequent
employment, the term “cause” is hereby defined to mean only the following
events as determined by Bally, upon reasonable investigation, in its judgment
and discretion, as the case may be:

 

(1)           A
material act or omission which is dishonest or fraudulent against Bally;

 

(2)           A
conviction of a felony or conviction of a gross misdemeanor involving moral
turpitude or criminal conduct against any person or property, including without
limitation, Bally;

 

(3)           A
substantial act or omission that constitutes willful misconduct in the
performance of your job responsibilities or material failure to adhere to
Company policies;

 

(4)           A
substantial act, omission or pattern of conduct in the performance of your job responsibilities,
which constitutes failure to meet satisfactory, work standards. You shall have thirty
days written notice from Bally to effect a cure of unsatisfactory work
standards and avoid termination hereunder;

 

2

 

(5)           Any
material breach of this letter agreement. You shall have thirty days after
written notice describing the particulars of the default from Bally to you to
effect a cure and avoid termination hereunder;

 

(6)           Failure
to comply with any provision of the gaming laws of the State of Nevada or the rules and
regulations of the Nevada Gaming Control Board or the Nevada Gaming Commission or
any gaming law, ordinance, rule or regulation of any city or county having
jurisdiction, or the gaming laws, regulations and rules of any other
nation, state, county or other jurisdiction in which Bally may be doing
business at any time which will materially and negatively affect the registration
and licensing of Bally. You shall have thirty days’ written notice from Bally
to effect a cure and avoid termination hereunder.

 

If you are terminated without cause, you
agree not to compete with Bally during your Salary Continuation Period, as set
forth above. Furthermore, if you are terminated without cause, Bally may elect,
at its sole option, to extend your period of non-competition for an additional
period of time of up to one year if Bally provides you with Salary Continuation
and MIP Continuation during this additional period of non-competition. In the
event Bally so elects to exercise its option to extend the Non-Compete Period,
Bally shall give you written notice at least one-hundred eighty days before the
expiration of the initial Non-Compete Period.

 

To “compete” means to establish, engage, or
be connected with, directly or indirectly, any person or entity engaged in a
business in competition with the business Bally (which, as defined above,
includes any of Bally’s subsidiaries or affiliates) in any area where Bally
does business, whether as an employee, owner, partner, agent, employee,
officer, consultant, advisor, stockholder (except as the beneficial owner of
not more than 5 percent of the outstanding shares of a corporation, any of the
capital stock of which is listed on any national or regional securities
exchange or quoted in the daily listing of over-the-counter market securities
and, in each case, in which you do not undertake any management or operational
or advisory role) or in any other capacity, for your own account or for the
benefit of any person or entity.

 

You acknowledge and agree that the scope and
duration of this covenant not to compete are reasonable and fair. However, if a
court of competent jurisdiction determines that this covenant is overly broad
or unenforceable in any respect, you and Bally agree that the covenant shall be
enforced to the greatest extent the court deems appropriate and that the court
may modify this covenant to that extent.

 

Covenant not to solicit
customers, employees, or consultants. You agree that during your employment with
Bally and for six months after your employment ends for any reason or for the
duration of your entire Non-Compete Period, whichever is longer, you shall not,
directly or indirectly, (i) aid or endeavor to solicit or induce any other
employee or consultant of Bally to leave Bally to accept employment of any kind
with any other person or entity, or (ii) solicit the trade or patronage of
any of Bally’s customers (which includes customers of any of Bally’s
subsidiaries or affiliates) or of anyone who has traded or dealt with Bally
with respect to any technologies, services, products, trade secrets, or other
matters in which Bally is active.

 

Confidential information. You agree that
your work for Bally will give you access to confidential matters of Bally not
publicly known such as proprietary matters of a technical nature

 

3

 

(including but not limited to know-how, technical
data, gaming processes, gaming equipment, techniques, developments) and
proprietary matters of a business nature (including but not limited to
information about costs, profits, markets, sales, lists of customers, and
matters received by Bally in confidence from other parties), collectively
referred to as “Confidential Matters.” Some Confidential Matters may be
entitled to protection as “Trade Secrets,” as that term is defined in N.R.S.
600A.030(5), the Restatement of Torts, and case law interpreting the same. “Confidential
Matters” shall not include any matters for which you have prior knowledge of
prior to the Effective Date of this Agreement or matters that are known or come
to be known as industry standard practice.

 

You agree to keep secret all such
Confidential Matters and agree not to directly or indirectly, other than is
necessary in the business of Bally and the scope of your employment, disclose
or use any such Confidential Matters at any time except with prior written
consent of Bally. You agree that all written materials (including
correspondence, memoranda, manuals, notes, and notebooks) and all models,
mechanisms, devices, drawings, and plans in your possession from time to time
(whether or not written or prepared by you) embodying Confidential Matters
shall be and remain the sole property of Bally, and you will use all reasonable
precautions to assure that all such written materials and models, mechanisms,
devices, drawings, and plans are properly protected and kept from unauthorized
persons. You further agree to deliver all Confidential Matters, including
copies, immediately to Bally on termination of your employment for any reason,
or at any time Bally may request.

 

Unless required by court proceeding, for a
period of ten years after termination of your employment with Bally for any
reason, you shall not reveal directly or indirectly to any person or entity or
use for your personal benefit (including without limitation, for the purpose of
soliciting business, whether or not competitive with any business of Bally) any
Confidential Matters. To the extent that any Confidential Matters are
considered by Bally as Trade Secrets, you agree that all limitations on use of
these Trade Secrets shall last forever. You further agree that immediately upon
or after termination, you will deliver to Bally all memoranda, notes, reports,
lists, models, mechanisms, devices, drawings or plans and other documents (and
all copies thereof) in your possession relating to the business of Bally or its
subsidiaries and affiliates.

 

Intellectual Property. You shall promptly
disclose in writing to Bally all inventions, discoveries, concepts, ideas,
developments, improvements, and innovations, whether or not patentable, and the
expressions of all inventions, discoveries, concepts, ideas, developments, improvements,
and innovations, whether or not copyrightable (collectively “Inventions”),
conceived, developed, or first actually reduced to practice by you, either
alone or with others, during your employment with Bally or during the first six
months after your employment with Bally ends for any reason, that (i) relate
in any manner to the existing or contemplated business or research activities
of Bally, (ii) are suggested by or result from your work for Bally; or (iii) result
from the use of time, materials, or facilities of Bally. All Inventions you
conceive, develop, or first actually reduce to practice, either alone or with
others, while employed by Bally that relate in any manner to the existing or
contemplated business or research activities of Bally shall be the exclusive
property of Bally. You assign to Bally your entire right, title, and interest
in and to all such Inventions and to all unpatented Inventions that you now
own, except those specifically described in a statement that has been separately
executed by you and an officer of Bally and attached hereto, provided, however,
that if no such list is attached, you represent and

 

4

 

warrant that there are no such Inventions. You
will, at the request and expense of Bally, execute specific assignments to any
such Inventions and execute, acknowledge, and deliver patent applications and
such other documents (including but not limited to all provisionals,
continuations, continuations-in-part, continued prosecution applications,
extensions, re-issues, re-examinations, divisionals and foreign counterparts)
and take such further action as may be considered necessary by Bally at any
time, whether during your employment with Bally or after it terminates for any
reason, to obtain and define letters patent in any and all countries and to
vest title to such Inventions and related patents or patent applications in
Bally or its assignees. Any Invention that you disclose to a third person or
describe in a patent application filed by you or in your behalf during your
employment with Bally or within six months after your employment with Bally
terminates for any reason shall be presumed to have been conceived or made by
you during your employment with Bally unless proved to have been conceived and
made by you after the expiration or termination of this letter agreement.

 

Non-disparagement. You and Bally each
agree that, during your employment with Bally and after your employment with
Bally terminates for any reason, neither shall, publicly or privately,
disparage or make any statements (written or oral) that could impugn the
integrity, acumen (business or otherwise), ethics, or business practices of the
other (including, in the case of Bally, its affiliates and subsidiaries), except,
in each case, to the extent (but solely to the extent) necessary (i) in
any judicial or arbitration action to enforce the provisions of this letter
agreement, or (ii) in connection with any judicial or administrative
proceeding to the extent required by applicable law, or (iii) as otherwise
required by law.

 

Injunctive relief;
jurisdiction. You acknowledge that Bally will suffer irreparable
injury; not readily susceptible of valuation in monetary damages, if you breach
any of your obligations under the non-compete, non-solicitation,
non-disclosure, confidentiality, intellectual property or non-disparagement
sections of this Agreement. Accordingly, you agree that Bally will be entitled,
at its option, to injunctive relief against any breach by you of your
obligations under these sections in any federal or state court of competent
jurisdiction sitting in Nevada, in addition to monetary damages and any other
remedies available at law or in equity. You hereby submit to the jurisdiction
of such courts for the purposes of any actions or proceedings instituted by
Bally to obtain such injunctive relief, and agree that process may be served on
you under the relevant rules of civil procedure, addressed to your last
address known to Bally, or in any other manner authorized by law.

 

Material inducements. The restrictive
covenants and other provisions in this letter agreement are material
inducements to Bally entering into and performing its obligations under this
letter agreement. Accordingly, in the event of any breach of these provisions
by you, in addition to all other remedies at law or in equity possessed by
Bally, including but not limited to the right to enforce the covenants you have
agreed to in this letter agreement, Bally shall have the right to terminate this
letter agreement and your employment with Bally and not pay any amounts payable
to you under this letter agreement.

 

Except as expressly modified by this letter,
the terns and conditions of your employment with Bally shall remain in full
force and effect and shall be subject to Bally’s regular employment policies
and practices as may be in effect from time to time. This letter comprises the
entire agreement between you and Bally and supersedes all other oral and
written agreements

 

5

 

previously entered into by you and Bally
concerning the same subject matter. To repeat, this offer is not intended to,
and if accepted it will not, create an agreement of employment for any specific
term or otherwise alter the at-will nature of your employment relationship with
Bally. If you accept this offer, either you or Bally may terminate your
employment at any time with or without cause.

 

If you accept this offer, please sign below
and return this letter to me. A copy will be sent for your records. Once signed
and returned, this letter will comprise a binding agreement between you and
Bally. This agreement may be executed by facsimile copy and in multiple
counterparts, each of which shall be deemed an original, but all of which when
taken together shall constitute one and the same instrument. If you have any
questions about its meaning, you are urged to consult with your attorney.

 

 

Sincerely,

 

 

	
  ALLIANCE GAMING CORPORATION

  
	
   

  
	
  /s/ Robert L. Miodunski

  	
   

  
	
  By: Robert L. Miodunski, President

  

 

 

ACCEPTANCE

 

I have read the foregoing letter, and I have
reviewed it with counsel or have had the opportunity to do so. I understand and
accept its terms.

 

 

	
  /s/ Robert Luciano

  	
   

  	
  March 2, 2004

  	
   

  
	
  Robert Luciano

  	
  Date signed

  

 

6Exhibit
10.30

 

AMENDMENT
TO EMPLOYMENT AGREEMENT

 

This Amendment to that certain employment
letter dated as of March 2, 2004 (the “Employment Agreement”), by
and between Alliance Gaming Corporation, a Nevada corporation (the “Company”‘),
and Robert Luciano (“Luciano”), is made and entered into as of April 13,
2005 (the “Effective Date”) by and between the Company and Luciano (the “Amendment”).

 

WHEREAS, the Employment Agreement provides
for Luciano’s employment by Bally Gaming, Inc. (“Bally”), as
Executive Vice President of Bally and President of Sierra Design Group; and

 

WHEREAS, the Company and Luciano desire to
amend the Employment Agreement to reflect Luciano’s new title, to assign to
Luciano all of the rights, title and interest in certain patents, and to
provide for the grant to Luciano of options to acquire shares of the Company’s
common stock under the Company’s Amended and Restated 2001 Long Term Incentive
Plan (the “Plan”).

 

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

 

1.             Position
and Title. From and after the Effective Date, Luciano’s position, title and
duties shall be: Chief Technology Officer of Bally, reporting to the President
of Bally, with such duties as may be assigned by the President of Bally. In
addition, from and after the Effective Date, all references in the Employment
Agreement to Sierra Design Group shall, to the extent applicable, be deemed
references to Bally.

 

2.             Assignment
of Golf Ball Patents and Related Technology. Notwithstanding anything in
the Employment Agreement to the contrary, and subject to any approval of the
Company’s lenders that may be required for such an assignment, Bally shall
assign to Luciano all of the rights, title and interest in and to the patents
listed on Exhibit A hereto, each of which was acquired by the Company in
connection with its acquisition of Sierra Design Group on March 2, 2004,
and any similar or related patents or technology involving the tracking or
detection of golf balls in non-casino gaming applications.

 

3.             Exclusivity.
While employed by Bally, Luciano shall devote his full business time, best
efforts, energies, attention and ability to the business and interests of the
Bally; except that Luciano may devote a portion of his business time to other
ventures in accordance with the following schedule:

 

(a)           from
and after the Effective Date and until December 31, 2005, Luciano may
devote up to 10% of his business time to interests other than the business of
Bally;

 

(b)           from
and after December 31, 2005, and until December 31, 2007, Luciano may
devote up to 20% of his business time to interests other than the business of
Bally;

 

(c)           from
and after December 31, 2007, Luciano may devote up to 30% of his business time
to interests other than the business of Bally.

 

 

The parties hereto agree that nothing herein shall change the at-will
nature of Luciano’s employment relationship with Bally or limit the ability of
Luciano or Bally to terminate Luciano’s employment with Bally at any time with
or without cause. In addition, (i) nothing herein shall limit or be deemed
a waiver of the covenant not to compete set forth in the Employment Agreement
and in the Stock Purchase Agreement (the “Stock Purchase Agreement”),
dated November 10, 2003, by and among the Company, Sierra Design Group,
Luciano and certain other parties thereto (the “Non-Competition Covenants”)
and (ii) Luciano agrees to provide Bally with a written representation
letter at least once every six months from and after the Effective Date
describing any of Luciano’s outside business interests and affirming and
representing that Luciano’s involvement in such interests does not violate any
of the Non-Competition Covenants.

 

4.             Expenses.    Bally shall reimburse Luciano for
reasonable expenses incurred by Luciano for meals while traveling in Las Vegas,
Nevada, and (b) for maintaining an automobile for business purposes in Las
Vegas, Nevada. In addition, Bally shall reimburse Luciano for reasonable travel
expenses incurred by Luciano’s wife for travel between Reno, Nevada and Las Vegas,
Nevada, to the extent Bally determines that such travel reduces the need for
Luciano to travel to Reno, Nevada. Any reimbursement of expenses pursuant to
this Amendment shall be contingent upon presentation by Luciano of itemized
accounts of such expenditures in accordance with the expense reimbursement
policies of Bally, as in effect from time to time.

 

5.             Additional
Non-Competition Period. At any time while Luciano is employed by Bally or
at any time during the Non-Competition Period (as defined in the Employment
Agreement), Bally may, in its sole discretion, elect to extend the duration of
the Non-Competition Period by an additional 12 months beyond its then current
term by agreeing (i) to pay to Luciano an additional $250,000, payable in
equal installments over such 12-month extension period and (ii) that, if
such election occurs in connection with and prior to a termination of Luciano’s
employment by Bally without cause (as defined in the Employment Agreement), any
options to acquire shares of the Company’s common stock then held by Luciano
will continue to vest in accordance with their vesting schedule for one
additional year beyond Luciano’s termination of employment with Bally.

 

6.             Stock
Options.

 

(a)           On
January 18, 2005, the Company granted Luciano a non-statutory stock option
to acquire 600,000 shares of the Company’s common stock under the Plan (the “Initial
Option”), at an exercise price per share equal to the fair market value of
a share of the Company’s common stock as of January 18, 2005 (as
determined in accordance with the Plan). The Initial Option shall vest over five
years from the date of grant, with 20% of the shares covered thereby vesting on
each of the first five anniversaries of January 18, 2005, subject to
Luciano’s continued employment with the Company through each such vesting date.

 

(b)           In
addition to the Initial Option, so long as Luciano is continuously employed by
the Company through July 1, 2005, the Company shall grant to Luciano on July 1,
2005 (or as soon as practicable thereafter), a non-statutory stock option to
acquire an additional 600,000 shares of the Company’s common stock under the
Plan (the “Additional Option”), at an exercise price per share equal to
the fair market value of a share of the Company’s common stock as of the date
of grant of the Additional Option (as determined in accordance with the Plan).
The Additional Option shall vest (i) with respect to 20% of the shares
covered thereby on each of the first four anniversaries of July

 

2

 

2005, and (ii) with respect to the remaining 20% of the shares
covered thereby on the fifth anniversary of the Effective Date, in each case,
subject to Luciano’s continued employment with the Company through each such
vesting date.

 

(c)           In
the event that Luciano’s employment is terminated by Bally without cause (as defined
in the Employment Agreement), the then vested and outstanding portion of any
options to acquire shares of the Company’s common stock granted to Luciano
shall remain outstanding and exercisable until the first anniversary of the
date of termination, but in no event beyond the term of such options, at which
time the unexercised portion of any such options shall expire. For the avoidance
of doubt, the unvested portion of any options to acquire shares of the Company’s
common stock held by Luciano at the time of the termination of his employment
shall terminate and expire as of such termination of employment.

 

(d)           Other
than as expressly set forth herein, the Initial Option and the Additional
Option, when granted, shall be subject to all of the applicable terms and
conditions of the Plan.

 

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

 

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

 

	
  ALLIANCE
  GAMING CORPORATION

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Richard Haddrill

  	
   

  	
  /s/ Robert Luciano

  	
   

  
	
   

  	
  Richard Haddrill, President

  	
   

  	
  Robert Luciano

  	
   

  

 

3

 

EXHIBIT A

Golf Ball
Patent Applications

 

	
  TITLE

  	
   

  	
  SERIAL NUMBER

  	
   

  	
  FILING DATE

  
	
  Enhanced
  Golf Range Play Using RFID and GPS

  	
   

  	
  10/057,007

  	
   

  	
  01/24/2002

  
	
  Target-Based
  Wagering System and Method

  	
   

  	
  10/087,378

  	
   

  	
  03/01/2002

  

 

4

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