Document:

Exhibit 4.3

 

Unless this Security is presented by an authorized representative of The Depository Trust Company, a New York corporation (“DTC”), 55 Water Street, New York, New York, to the Issuer (as defined below) or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.

 

This Security is a global Security within the meaning set forth in the Indenture hereinafter referred to and is registered in the name of DTC or a nominee of DTC.  This Security is exchangeable for Securities registered in the name of a person other than DTC or its nominee only in the limited circumstances described in the Indenture, and may not be transferred except as a whole by DTC to a nominee of DTC or another nominee of DTC or by DTC or its nominee to a successor depository or its nominee.

 

	
Registered No. 1
    	
PRINCIPAL   AMOUNT
    

CUSIP No.:  55448Q AR 7

 

$250,000,000

 

MACK-CALI REALTY, L.P.

 

2.500% NOTE DUE 2017

 

MACK-CALI REALTY, L.P., a limited partnership duly organized and existing under the laws of the State of Delaware (herein referred to as the “Issuer” which term shall include any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO., or registered assigns, upon presentation, the principal sum of TWO HUNDRED FIFTY MILLION DOLLARS on December 15, 2017, and to pay interest on the outstanding principal amount thereon from November 20, 2012, or from the immediately preceding Interest Payment Date to which interest has been paid or duly provided for, semi-annually in arrears on June 15 and December 15 in each year, commencing June 15, 2013, at the rate of 2.500%  per annum, until the entire principal hereof is paid or made available for payment.  The interest so payable and punctually paid or duly provided for on any Interest Payment Date will, as provided in the Indenture, be paid to the Person in whose name this Security is registered at the close of business on the Regular Record Date for such interest which shall be the June 1 or December 1 (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date.  Any such interest not so punctually paid or duly provided for shall forthwith cease to be payable to the Holder on such Regular Record Date, and may either be paid to the Person in whose name this Security is registered at the close 

 

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of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of the Securities not more than 15 days and not less than 10 days prior to such Special Record Date, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities may be listed, and upon such notice as may be required by such exchange, all as more fully provided in the Indenture.  Payment of the principal of and interest on this Security will be made at the office or agency maintained for that purpose in the City of Wilmington, Delaware or elsewhere as provided in the Indenture, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that at the option of the Issuer payments of principal and interest on the Notes (other than payments of principal and interest due at Maturity) may be made (i) by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or (ii) by wire transfer to an account of the Person entitled thereto located within the United States.

 

Securities of this series are one of a duly authorized issue of securities of the Issuer (herein called the “Securities”), issued and to be issued in one or more series under an Indenture, dated as of March 16, 1999, among the Issuer, Mack-Cali Realty Corporation and Wilmington Trust Company (herein called the “Trustee”, which term includes any successor trustee under the Indenture), as supplemented by Supplemental Indenture No. 1, dated as of March 16, 1999, as further supplemented by Supplemental Indenture No. 2, dated as of August 2, 1999, as further supplemented by Supplemental Indenture No. 3, dated as of December 21, 2000, as further supplemented by Supplemental Indenture No. 4, dated as of January 29, 2001, as further supplemented by Supplemental Indenture No. 5, dated as of December 20, 2002, as further supplemented by Supplemental Indenture No. 6, dated as of March 14, 2003, as further supplemented by Supplemental Indenture No. 7, dated as of June 12, 2003, as further supplemented by Supplemental Indenture No. 8, dated as of February 9, 2004, as further supplemented by Supplemental Indenture No. 9, dated as of March 22, 2004, as further supplemented by Supplemental Indenture No. 10, dated as of January 25, 2005, as further supplemented by Supplemental Indenture No. 11, dated as of April 15, 2005, as further supplemented by Supplemental Indenture No. 12 dated as of November 30, 2005, as further supplemented by Supplemental Indenture No. 13 dated as of January 24, 2006, as further supplemented by Supplemental Indenture No. 14 dated as of August 14, 2009, as further supplemented by Supplemental Indenture No. 15 dated as of April 19, 2012 and as further supplemented by Supplemental Indenture No. 16 dated as of November 20, 2012 (as so supplemented, herein called the “Indenture”), between the Issuer and the Trustee to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Issuer, the Trustee and the Holders of the Securities and of the terms upon which the Securities are authenticated and delivered.  This Security is one of the series designated in Section 2.1 of Supplemental Indenture No. 16 referred to above, limited in aggregate principal amount to $250,000,000, except as the aggregate principal amount may be increased pursuant to Section 2.2 of Supplemental Indenture No. 16 referred to above.

 

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Securities of this series may be redeemed at any time at the option of the Issuer, in whole or in part, upon notice of not more than 60 nor less than 30 days prior to the Redemption Date, at a redemption price equal to the sum of (i) the principal amount of the Securities being redeemed plus accrued and unpaid interest thereon up to but not including the Redemption Date and (ii) the Make-Whole Premium, if any, with respect to such Securities.

 

The Indenture contains provisions for defeasance at any time of (a) the entire indebtedness of the Issuer on this Security and (b) certain restrictive covenants and the related defaults and Events of Default applicable to the Issuer, in each case, upon compliance by the Issuer with certain conditions set forth in the Indenture, which provisions apply to this Security.

 

If an Event of Default with respect to the Securities shall occur and be continuing, the principal of the Securities may be declared due and payable in the manner and with the effect provided in the Indenture.

 

As provided in and subject to the provisions of the Indenture, the Holder of this Security shall not have the right to institute any proceeding with respect to the Indenture or for the appointment of a receiver or trustee or for any other remedy thereunder, unless such Holder shall have previously given written notice to the Trustee of a continuing Event of Default with respect to the Securities, the Holders of not less than a majority in principal amount of the Securities of this series at the time Outstanding shall have made written request to the Trustee to institute proceedings in respect of such Event of Default as Trustee and offered the Trustee reasonable indemnity and the Trustee shall not have received from the Holders of a majority in principal amount of Securities of this series at the time Outstanding a direction inconsistent with such request, and shall have failed to institute any such proceeding, for 60 days after receipt of such notice, request and offer of indemnity.  The foregoing shall not apply to any suit instituted by the Holder of this Security for the enforcement of any payment of principal hereof or any interest on or after the respective due dates expressed herein.

 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Issuer and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Issuer and the Trustee with the consent of the Holders of not less than a majority in principal amount of the Outstanding Securities of each series of Securities then Outstanding affected thereby.  The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such series, to waive compliance by the Issuer with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences.  Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Security.

 

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No reference herein to the Indenture and no provision of this Security or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of (and Make-Whole Premium, if any) and interest on this Security at the times, place and rate, and in the coin or currency, herein prescribed.

 

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Security Register, upon surrender of this Security for registration of transfer at the office or agency of the Issuer in any Place of Payment where the principal of (and Make-Whole Premium, if any) and interest on this Security are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Issuer and the Security Registrar duly executed by the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Securities of this series, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

 

Except as set forth in Section 302 of the Indenture, the Securities of this series are issuable only in registered form without coupons in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof.  As provided in the Indenture and subject to certain limitations therein set forth, Securities of this series are exchangeable for a like aggregate principal amount of Securities of this series of a different authorized denomination, as requested by the Holder surrendering the same.

 

No service charge shall be made for any such registration of transfer or exchange, but the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.

 

Prior to due presentment of this Security for registration of transfer, the Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and neither the Issuer, the Trustee nor any such agent shall be affected by notice to the contrary.

 

No recourse under or upon any obligation, covenant or agreement contained in the Indenture or in this Security, or because of any indebtedness evidenced hereby or thereby, shall be had against any promoter, as such, or against any past, present or future shareholder, officer or director, as such, of the Issuer or of any successor, either directly or through the Issuer or any successor, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance of this Security by the Holder thereof and as part of the consideration for the issue of the Securities of this series.

 

All capitalized terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture.

 

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THE INDENTURE AND THE SECURITIES, INCLUDING THIS SECURITY, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Issuer has caused “CUSIP” numbers to be printed on the Securities of this series as a convenience to the Holders of such Securities.  No representation is made as to the correctness or accuracy of such CUSIP numbers as printed on the Securities, and reliance may be placed only on the other identification numbers printed hereon.

 

Unless the certificate of authentication hereon has been executed by or on behalf of the Trustee by manual signature, this Security shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

 

[REMAINDER OF PAGE INTENTIONALLY BLANK; SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, MACK-CALI REALTY, L.P. has caused this instrument to be duly executed.

 

Dated:  November 20, 2012

 

	
 
    	
MACK-CALI REALTY, L.P.
    
	
 
    	
 
    
	
 
    	
By:
    	
Mack-Cali   Realty Corporation, its
    
	
 
    	
 
    	
General   Partner
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Barry Lefkowitz
    
	
 
    	
 
    	
Name:
    	
Barry   Lefkowitz
    
	
 
    	
 
    	
Title:
    	
Executive   Vice President and
    
	
 
    	
 
    	
 
    	
Chief   Financial Officer
    

Attest:

 

	
/s/ Roger W. Thomas
    	
 
    	
 
    
	
Name:
    	
Roger W. Thomas
    	
 
    	
 
    
	
Title:
    	
Executive   Vice President,
    	
 
    	
 
    
	
 
    	
General   Counsel and Secretary
    	
 
    	
 
    

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION:

 

This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

 

Dated:  November 20, 2012

 

 

	
 
    	
WILMINGTON   TRUST COMPANY,
    
	
 
    	
as Trustee
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Joshua C. Jones
    
	
 
    	
 
    	
Authorized Signatory
    

 

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ASSIGNMENT FORM

 

FOR VALUE RECEIVED, the undersigned hereby

sells, assigns and transfers unto

 

PLEASE INSERT SOCIAL

SECURITY OR OTHER IDENTIFYING

NUMBER OF ASSIGNEE

	
 
    	
 
    
	
 
    
	
 
    
	
(Please Print or Typewrite Name and Address including
    
	
Zip Code of Assignee)
    

 

	
 
    

the within Security of Mack-Cali Realty, L.P. and hereby does irrevocably constitute and appoint

 

                                                                                                                                                                                                       Attorney

to transfer said Security on the books of the within-named Issuer with full power of substitution in the premises.

 

	
Dated:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    

 

NOTICE:  The signature to this assignment must correspond with the name as it appears on the first page of the within Security in every particular, without alteration or enlargement or any change whatever.

 

Signature(s) must be guaranteed by an institution which is a member of one of the following recognized signature Guarantee Programs:  (i) The Securities Transfer Agent Medallion Program (STAMP); (ii) The New York Stock Exchange Medallion Program (MNSP); (iii) The Stock Exchange Medallion Program (SEMP); or (iv) another guarantee program acceptable to the Trustee.

	
 
    	
 
    
	
Signature   GuaranteeExhibit 10.1

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

EXECUTIVE EMPLOYMENT AGREEMENT dated as of November 14, 2012, by and between BALLY TECHNOLOGIES, INC., a Nevada corporation (the “Company”), and RAMESH SRINIVASAN (“Executive”).

 

WHEREAS, the Company and Executive are parties to that certain Executive Employment Agreement dated as of March 9, 2005, and amended as of December 31, 2008 and May 23, 2011 (the “Prior Employment Agreement”); and

 

WHEREAS, the Company and Executive desire to enter into a new Executive Employment Agreement (this “Agreement”) in accordance with and subject to the terms and conditions hereof;

 

WHEREAS, this Agreement shall supersede the Prior Employment Agreement in its entirety.

 

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.             Term.  The term of this Agreement shall commence on December 14, 2012 (the “Effective Date”) and shall continue, unless earlier terminated pursuant to Section 4 of this Agreement, through the third anniversary of the Effective Date, and shall thereafter be automatically renewed for successive one year periods unless either party gives written notice to the other party of its intention not to renew at least ninety days prior to the expiration of said term.

 

2.             Position and Duties.  From and after the Effective Date, Executive shall serve as the Company’s President and Chief Executive Officer and shall report to the Board of Directors of the Company.  Executive shall perform the duties contemplated by such title and such other duties, consistent with his experience and abilities, as the Board of Directors of the Company may assign to Executive.  Executive shall devote his full business time and efforts to the business and affairs of the Company, use his best efforts to advance the interests of the Company, and at all times conduct himself in a manner that reflects credit on the Company.  It is contemplated that Executive shall render services to the Company from the Company’s principal place of business; however, the parties acknowledge and agree that Executive may be required to travel extensively in fulfilling his duties hereunder.

 

3.             Compensation.

 

(a)           Salary.  From and after the Effective Date, the Company shall pay Executive an annual base salary of $825,000, payable in equal installments on the Company’s regularly recurring paydays in accordance with the Company’s normal payroll practice.  Increases in annual base salary shall be considered by the Company at least annually, beginning with the Company’s 2014 fiscal year and will be based on criteria applicable to other senior executives of the Company, provided, however, that the award of any such increase shall be at the sole discretion of the Company.

 

 

(b)           Management Incentive Program.  Executive shall continue to be entitled to participate in the Company’s Management Incentive Program (and/or such other incentive compensation plan maintained by the Company) established for the Company (the “MIP”).  The terms of Executive’s participation in the MIP shall continue in place as provided in the Prior Employment Agreement until June 30, 2013.  From and after July 1, 2013, the MIP will entitle Executive to receive up to 200 percent of Executive’s base salary for performance at plan maximum, with Executive’s target annual bonus under the MIP equal to 100 percent of his base salary and the threshold annual bonus under the MIP equal to 60 percent of his base salary.  Executive’s bonus under the MIP shall be earned based upon objectives established by the Board of Directors each year, which objectives shall be based on the Company’s earnings per share performance (or such other objective measure determined by the Compensation Committee of the Board of Directors).  Any payment made to Executive pursuant to the MIP in accordance with this Section 3(b) shall be paid to Executive in a lump sum payment payable in the normal business course similar to those payments made to other Company executives, but in no event later than by December 31 of the calendar year that includes the last day of the fiscal year to which such payment relates.

 

(c)           Promotion Restricted Stock Unit Award.  On December 14, 2012 Executive shall receive an award of performance-vesting restricted stock units (the “Promotion RSUs”) under the Company’s 2010 Long Term Incentive Plan (the “LTIP”) covering a number of shares initially equal to $3,000,000.  Subject to the terms of the award agreement and the achievement of performance targets, the Promotion RSUs will vest annually over three years.

 

(d)           Equity Awards.  Executive shall be eligible to receive equity grants in the future, at the discretion of and as approved by the Company’s Board of Directors and/or Compensation Committee thereof.

 

(e)           Reimbursement of expenses.  In accordance with established policies and procedures of the Company as in effect from time to time, the Company shall pay or reimburse Executive for all reasonable and actual out-of-pocket expenses including but not limited to travel, hotel, and similar expenses, incurred by Executive from time to time in performing his obligations under this Agreement.  Any reimbursement of Executive’s expenses made by the Company pursuant to this Section 3(e) shall be payable in the normal business course in accordance with the Company’s expense reimbursement policy, but in no event later than the last day of the calendar year following the calendar year in which the expense was incurred, and the expenses eligible for reimbursement in anyone calendar year shall not affect the expenses eligible for reimbursement in any other calendar year.

 

(f)            Vacation.  Executive shall be entitled to annual paid vacation time in accordance with the Company’s policy with respect to the senior executives of the Company prorated for any partial employment year.

 

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(g)           Other benefits.  Executive shall be entitled to other employment benefits, including but not limited to life insurance, medical and hospitalization, disability, and retirement benefits, consistent with the benefits provided to other senior executives of the Company.

 

(h)           No Reduction.  There shall be no material reduction or diminution of the benefits provided in this Section 3 during the term of this Agreement unless (i) Executive consents in writing, (ii) an equitable arrangement (embodied in a substitute or alternative benefit or plan) is made with respect to such benefit or plan, or (iii) the reduction is part of a program of across-the-board benefit reductions similarly affecting all other senior executive officers of the Company.

 

4.             Termination or Material Change of Employment

 

(a)           At-will employment.  Executive’s employment with the Company is “at-will.” Either Executive or the Company may terminate Executive’s employment at any time with or without Cause.

 

(b)           Termination by Company for Cause.

 

(1)           The Company may terminate this Agreement for Cause at any time immediately on written notice to Executive, in which case the Company’s obligations and Executive’s rights under this Agreement shall terminate.  For purposes of this provision, the term “Cause” means:

 

(i)            Executive’s clear and substantiated insubordination, fraud, disloyalty, dishonesty, willful misconduct, or gross negligence in the performance of Executive’s duties under this Agreement, including willful and material failure to perform such duties as may properly be assigned to Executive under this Agreement;

 

(ii)           Executive’s material breach (without cure within 30 days following notice thereof) of any material provision of this Agreement;

 

(iii)          Executive’s failure to qualify (or having so qualified being thereafter disqualified) under any suitability or licensing requirement of any jurisdiction or regulatory authority to which Executive may be subject by reason of his position with the Company and its affiliates or subsidiaries.  The Company will use its best efforts to work with Executive in fulfilling the requirements and will promptly provide written information on the suitability and licensing requirements to Executive so that Executive may adequately prepare;

 

(iv)          Executive’s commission of a crime against the Company or violation of any material law, order, rule, or regulation pertaining to the Company’s business;

 

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(v)           Executive’s inability to perform the job functions and responsibilities assigned in accordance with reasonable standards established from time to time by the Company in its sole and reasonable discretion, which inability, if subject to cure, is not cured by Executive within 30 days after notice thereof; and

 

(vi)          The Company’s obtaining from any reliable source accurate information with respect to Executive that would, in the reasonable good faith opinion of the Company, jeopardize the gaming licenses, permits, or status of the Company or any of its subsidiaries or affiliates with any gaming commission, board, or similar regulatory or law enforcement authority.

 

(2)           Any termination by the Company for Cause shall not be in limitation of any other right or remedy the Company may have under this Agreement or otherwise.

 

(c)           Termination by Company without Cause.  The Company may terminate this Agreement at any time without Cause (as defined in Section 4(b)(1)), whereupon the Company’s obligations and Executive’s rights under this Agreement shall terminate, except that the Company shall, subject to Executive’s execution, within 21 days following Executive’s date of termination, of an effective general release of claims in favor of the Company (i) pay to Executive, in lump sum, on the date that is 30 days following Executive’s date of termination, an amount equal to Executive’s base salary for twenty-four months, (ii) pay to Executive, on the date that is 30 days following Executive’s date of termination, a pro-rata amount of Executive’s target bonus under the MIP for the year of termination, based on actual performance through the end of the fiscal quarter that ended most recently prior to the date of termination, and (iii) accelerate on a pro-rata basis the vesting of Executive’s equity awards outstanding on the date of termination in a manner consistent with the terms thereof, which, in the case of awards that vest based upon the attainment of performance targets, shall be based upon actual performance through the end of the fiscal quarter that ended most recently prior to the date of termination.

 

(d)           Termination by Executive.  Except as set forth in Section 4(e), if Executive resigns for any reason, the Company’s obligations and Executive’s rights under this Agreement shall terminate; provided, however, that a resignation within 60 days following a material diminution of Executive’s duties shall be treated as a termination without cause under Section 4(c).  As used in this Section 4, Executive’s duties shall be deemed to have been materially diminished if, without Executive’s prior written consent, (1) Executive (A) is not the Chief Executive Officer of, the Company or, following a Change of Control, the combined or surviving corporation resulting from the Change of Control or (B) does not report directly to the Board of Directors of the Company or, following a Change of Control, the ultimate parent company resulting from the transaction, (2) the Company materially breaches (without cure within 30 days following notice

 

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thereof) any material provision of this Agreement, or (3) his position, title, duties, authority or responsibilities are otherwise substantially diminished.

 

(e)           Termination by Company due to Death or Disability.  The Company may terminate this Agreement at any time due to Executive’s death or disability (as defined below), whereupon the Company’s obligations and Executive’s rights under this Agreement shall terminate, except that the Company shall, (ii) pay to Executive or Executive’s estate a pro-rata amount of Executive’s target bonus under the MIP for the year of termination, based on actual performance through the end of the fiscal quarter that ended most recently prior to the date of termination, and (iii) accelerate on a pro-rata basis the vesting of Executive’s equity awards outstanding on the date of termination in a manner consistent with the terms thereof, which, in the case of awards that vest based upon the attainment of performance targets, shall be based upon actual performance through the end of the fiscal quarter that ended most recently prior to the date of termination.  “Disability” shall mean Executive’s failure to discharge his duties under this Agreement for six or more consecutive months or for non-continuous periods aggregating to twenty-two weeks in any twelve-month period as a result of illness or incapacity.

 

(f)            Change of Control.

 

(1)           Termination by Company or Executive.  In lieu of the payments and benefits described in Section 4(c), in the event of a termination by the Company without Cause or resignation within 60 days following a material diminution of Executive’s duties, which termination without Cause or material diminution of duties occurs within one year following the occurrence of a Change of Control, the Company’s obligations and Executive’s rights under this Agreement shall terminate, except that the Company shall, subject to Executive’s execution, within 21 days following Executive’s date of termination, of an effective general release of claims in favor of the Company (i) pay to Executive, in lump sum, on the date that is 30 days following Executive’s date of termination, an amount equal to Executive’s base salary for twenty-four months, (ii) pay to Executive, on the date that is 30 days following Executive’s date of termination, an amount equal to Executive’s target bonus under the MIP for the year of termination, and (iii) accelerate in full the vesting of Executive’s equity awards outstanding on the date of termination in a manner consistent with the terms thereof.  Accelerated vesting in the case of equity awards that vest based upon the attainment of TSR performance targets, shall be based upon actual performance through the date of the Change of Control; provided, that accelerated vesting in the case of equity awards that vest based on the attainment of non-TSR performance targets, shall be based upon actual performance through the end of the fiscal quarter that ended most recently prior to the date of Change of Control.

 

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(2)           “Change of Control” defined.  As used in this Section 4(e), a Change of Control shall be deemed to have occurred upon the earliest to occur of the following events: (i) the date an unaffiliated person, entity or group (as defined in Treas. Reg. I.409A-3(i)(5)(v)(B)) acquires, directly or indirectly, ownership of a substantial portion of the Company’s assets equal to or more than 50% of the total gross fair market value (as defined in Treas. Reg. 1.409A-3(i)(5)(vii)) of all of the assets of the Company immediately before such acquisition or acquisitions; (ii) the date any unaffiliated person, entity or group (as defined in Treas. Reg. 1.409A-3(i)(5)(v)(B)) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of the Company’s capital stock having more than 50% of the combined voting power of the Company’s then outstanding voting securities entitled to vote generally in the election of directors; or (iii) a majority of members of the Company’s Board of Directors (together with any directors elected or nominated by a majority of such members) is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board of Directors before the date of the appointment or election; except that any event or transaction which would be a “Change of Control” under (i) or (ii) of this definition shall not be a Change of Control if persons who were the equity holders of the Company immediately prior to such event or transaction (other than the acquirer in the case of a reorganization, merger or consolidation), immediately thereafter, beneficially own more than 50% of the combined voting power of the Company’s or the reorganized, merged or consolidated company’s then outstanding voting securities entitled to vote generally in the election of directors.

 

(g)           Termination of Employment.  For all purposes of this Agreement, “termination of employment” and any phrase of similar meaning shall have the meaning assigned to such term in Treas. Reg. Section 1.409A-1(h)(1).

 

(h)           Six-Month Delay for Payments to Specified Employee.  If Executive is a Specified Employee (as defined below) as of the date of his termination of employment under this Agreement, notwithstanding any other provision of this Agreement, any payment (or commencement of a series of payments) to Executive following a termination of employment of any nonqualified deferred compensation (within the meaning of Code Section 409A will be accumulated (the “Accumulated Amount”) and Executive’s right to receive payment or distribution of such Accumulated Amount will be delayed until the earlier of Executive’s death or the first day of the seventh month following Executive’s termination of employment (the “Termination Payment Date”), whereupon the Accumulated Amount will be paid or distributed to Executive and the normal payment or distribution schedule for any remaining payments or distributions will resume.  During the period in which the payment of the Accumulated Amount is delayed pursuant to Code Section 409A, the Accumulated Amount will be set aside in a “rabbi trust” (within the meaning of Internal Revenue Service Revenue Procedure 92-64)

 

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established by the Company for purposes of holding the funds constituting the Accumulated Amount.  Such funds shall be invested in short-term U.S. Government obligations until the Termination Payment Date, and an amount equal to the interest earned on obligations held by the rabbi trust shall be paid to Executive on the Termination Payment Date or, if later, the date the Termination Payment is actually paid to Executive.  For purposes of this Agreement, the term “Specified Employee” has the meaning given such term in Code Section 409A and the final regulations thereunder (“Final 409A Regulations”), provided, however, that, as permitted in the Final409A Regulations, the Company’s Specified Employees and its application of the six-month delay rule of Code Section 409A(a)(2)(B)(i) shall be determined in accordance with rules adopted by the Board of Directors or a committee thereof, which shall be applied consistently with respect to all nonqualified deferred compensation arrangements of the Company, including this Agreement.

 

(i)            Resignation as a Member of the Board of Directors.  In all cases of termination and upon the expiration of this Agreement, unless otherwise agreed to in writing, Executive shall be deemed to have contemporaneously resigned from his position, if any, as a member of the Board of Directors of the Company or any of its subsidiaries, effective as of the date of termination or expiration.  Notwithstanding the foregoing, Executive’s resignation from the Board of Directors shall not adversely affect any options to purchase shares of the Company’s common stock, restricted stock grants or RSUs that were granted to Executive solely in his capacity as a Director of the Company or its subsidiaries, so long as, Executive’s termination is a result of his having been terminated pursuant to paragraphs (c), (e) or (f) above.

 

5.             Restrictive covenants.

 

(a)           Covenant not to compete.

 

(1)           Executive will not compete with the Company:

 

(i)            During the term of Executive’s employment with the Company; or

 

(ii)           For twenty-four months after the Company terminates Executive’s employment for any reason, subject to the Company continuing, to the extent required under Section 4, to pay Executive’s base salary as required in Section 4.

 

(2)           As used in Section 5(a), “compete” means to establish, engage, or be connected with, directly or indirectly, any company engaged in a business in competition with the business of the Company or its subsidiaries or affiliates in any area where the Company, its subsidiaries or affiliates are doing business, whether as owner, partner, agent, employee, director, officer, consultant, advisor, or stockholder (except as the beneficial owner of not more than 5 percent of the outstanding shares of a corporation, any

 

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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 Executive does not undertake any management or operational or advisory role).

 

(3)           The Company and Executive acknowledge and agree that the scope and duration of the covenant in Section 5(a) are reasonable and fair; however, if a court of competent jurisdiction determines that this covenant is overly broad or unenforceable in any respect, the Company and Executive acknowledge and agree that the covenant shall be enforced to the greatest extent any such court deems appropriate, and such court may modify this covenant to that extent.

 

(b)           Covenant not to solicit customers.  Executive shall not, directly or indirectly, during the term of Executive’s employment with the Company and for twenty-four months after termination of Executive’s employment for any reason, solicit the trade or patronage of any of the customers or prospective customers of the Company (which, for purposes of this paragraph, shall include any of the Company’s subsidiaries or affiliates) of which the Executive has personally engaged with in his capacity as Executive or of anyone whom the Executive has heretofore traded or dealt with in his capacity within the Company, regardless of the location of such customers or prospective customers of the Company with respect to any technologies, services, products, trade secrets, or other matters in which the Company is active.

 

(c)           Covenant not to solicit or hire employees, or consultants.  Unless Executive receives the prior written Consent of the Company, Executive shall not, directly or indirectly, during the term of Executive’s employment with the Company and for twenty-four months after termination of Executive’s employment for any reason, aid or endeavor to solicit or induce any other employee or consultant of the Company (which, for purposes of this paragraph, shall include any of the Company’s subsidiaries or affiliates), or anyone who was serving in such capacity upon the termination of Executive’s employment or who served in such capacity within one year of the termination of Executive’s employment, to leave the Company to accept employment of any kind with any other person or entity or do any act that may result in the impairment of the relationship between the Company on the one hand and the employees or consultants of the Company on the other hand.  Unless Executive receives the prior written Consent of the Company, Executive shall not, directly or indirectly, for eighteen months after termination of Executive’s employment for any reason, hire any employee or consultant of the Company or anyone who was serving in such capacity upon the termination of Executive’s employment or who served in such capacity within one year of the termination of Executive’s employment.  For the purposes of this paragraph “consultant” shall mean only those consultants whose use would pose a threat of competitive harm to the Company or would limit the Company’s ability to obtain the services of such consultant.

 

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(d)           Confidential Information.  Executive’s work for the Company will give Executive access to confidential matters of the Company not publicly known such as proprietary matters of a technical nature (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 the Company 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 Executive has prior knowledge of prior to the commencement of Executive’s employment with the Company or its affiliates or matters that are known or come to be known as industry standard practice.  Executive agrees to keep secret all such Confidential Matters and agree not to directly or indirectly, other than is necessary in the business of the Company and the scope of Executive’s employment, disclose or use any such Confidential Matters at any time except with prior written consent of the Company.  Executive agrees that all written materials (including correspondence, memoranda, manuals, notes, and notebooks) and all models, mechanisms, devices, drawings, and plans in Executive’s possession from time to time (whether or not written or prepared by Executive) embodying Confidential Matters shall be and remain the sole property of the Company, and Executive 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.  Executive further agrees to deliver all Confidential Matters, including copies, immediately to the Company on termination of Executive’s employment for any reason, or at any time the Company may request.  Unless required by court proceeding, for a period of three years after termination of Executive’s employment with the Company for any reason, Executive shall not reveal directly or indirectly to any person or entity or use for Executive’s personal benefit (including without limitation, for the purpose of soliciting business, whether or not competitive with any business of the Company) any Confidential Matters.  These obligations will not apply to the extent that the Confidential Matters (i) were already known to the Executive, without an obligation to keep it confidential, at the time of its receipt from the Company; (ii) were received by the Executive in good faith from a third party lawfully in possession thereof and having no obligation to keep such information confidential; or (iii) were publicly known at the time of its receipt by the Executive or has become publicly known other than by a breach of this Agreement or other action by the Executive.  To the extent that any Confidential Matters are considered by the Company as Trade Secrets, Executive agrees that all limitations on use of these Trade Secrets shall last as long as such information remains a trade secret under applicable law.  Executive further agrees that immediately upon or after termination, Executive will deliver to the Company all memoranda, notes, reports, lists, models, mechanisms, devices, drawings or plans and other documents (and all copies thereof) in Executive’s possession relating to the business of the Company or its subsidiaries and affiliates.

 

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(e)           Non-disparagement.  Each party agrees that, during Executive’s employment with the Company and after the termination thereof for any reason, neither shall, publicly or privately, intentionally disparage or make any willful 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 the Company, 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 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.

 

(f)            Intellectual Property.  Executive shall promptly disclose in writing to the Company 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 Executive, either alone or with others, during Executive’s employment with the Company, that (i) relate in any manner to the existing or contemplated business or research activities of the Company, (ii) are suggested by or result from Executive’s work for the Company; or (iii) result from the use of time, materials, or facilities of the Company.  All Inventions Executive conceives, develops, or first actually reduces to practice, either alone or with others, while employed by the Company that relate in any manner to the existing or contemplated business or research activities of the Company shall be the exclusive property of the Company.  Executive will, at the request and expense of the Company, 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 the Company at any time, whether during Executive’s employment with the Company 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 the Company or its assignees.  Any Invention that Executive discloses to a third person or describes in a patent application filed by Executive or in Executive’s behalf during Executive’s employment with the Company or within three months after Executive’s employment with the Company terminates for any reason shall be presumed to have been conceived or made by Executive during Executive’s employment with the Company unless proved to have been conceived and made by Executive after the expiration or termination of this Agreement.

 

(g)           Injunctive relief; jurisdiction.  Executive acknowledges that the Company will suffer irreparable injury, not readily susceptible of valuation in monetary damages, if Executive breaches any of Executive’s obligations under the restrictive covenants in this Section 5  Accordingly, Executive agrees that the Company will be entitled, at its option, to injunctive relief against any breach by

 

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Executive of Executive’s obligations under Section 5 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.  Executive hereby submits to the jurisdiction of such courts for the purposes of any actions or proceedings instituted by the Company to obtain such injunctive relief, and agree that process may be served on Executive under the relevant rules of civil procedure, addressed to Executive’s last address known to the Company, or in any other manner authorized by law.

 

(h)           Material inducements.  The restrictive covenants and other provisions in this Agreement are material inducements to the Company entering into and performing its obligations under this Agreement.  Accordingly, in the event of any proven breach of these provisions by Executive, in addition to all other remedies at law or in equity possessed by the Company, including but not limited to the right to enforce the covenants Executive has agreed to in this Agreement, the Company shall have the right to terminate this agreement and Executive’s employment with the Company and not pay any amounts payable to Executive under this Agreement.

 

6.             Licenses and approvals.  This Agreement is contingent on any necessary approvals and licenses from any regulatory authorities having jurisdiction over the parties or the subject matter of this Agreement.  Each party shall promptly apply to the appropriate regulatory authorities for any licenses and approvals necessary for Executive to perform under this Agreement and shall diligently pursue its applications, and the Company shall pay all associated costs and fees.  Each party shall fully cooperate with any requests, inquiries, or investigations of any regulatory authorities or law enforcement agencies in connection with the Company, its affiliates, or this Agreement.  If any license or approval necessary for either party to perform under this Agreement is denied, suspended, or revoked, this Agreement shall be void, provided, however, that if the denial, suspension, or revocation affects performance of the Agreement in part only, the parties may by mutual agreement continue to perform under this Agreement to the extent it is unaffected by the denial, suspension, or revocation.

 

7.             Compliance program.  The parties acknowledge that the Company operates under privileged licenses in a highly regulated industry, and that maintains a compliance program to protect and preserve the name, reputation, integrity, and good will of the Company and its subsidiaries and affiliates (the “Company Group”) through a thorough review and determination of the integrity and fitness, both initially and thereafter, of any person or company that performs work for any member of the Company Group or with which any member of the Company Group is or are otherwise associated, and to monitor compliance with the requirements established by gaming regulatory authorities in various jurisdictions around the world.  This Agreement and the association of the Company and its affiliates with Executive are contingent on the continued approval of the Company and its compliance committee under the Company’s compliance program and the parties shall cooperate with the Company and its compliance committee as reasonably requested by the Company or the committee and shall provide the committee with such information as

 

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it may request, but the termination of this Agreement shall in all respects be governed by and subject to the rights and obligations of the parties as set forth in Section 4 hereof.

 

8.             Executive’s Indemnification.  The Company shall, to the maximum extent permitted by law, indemnify Executive against expenses, judgments, fines, settlements and other amounts actually and reasonably incurred in connection with any threatened, pending or completed action, suit, arbitration, alternative dispute mechanism, inquiry, judicial, administrative or legislative hearing, investigation or proceeding (a “Proceeding”) arising by reason of the fact that Executive, is or was a director or officer of the Company or while a director or officer of the Company is or was serving at the request of the Company as a director, officer, employee, agent or trustee of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan.  Notwithstanding anything to the contrary contained herein, except as otherwise required by law, the Company shall indemnify Executive in connection with a Proceeding, or part thereof, initiated by such person (including claims and counterclaims, whether such counterclaims are asserted by (i) Executive, or (ii) the Company in a Proceeding initiated by Executive) only if such Proceeding, or part thereof, was authorized or ratified by the Board of Directors.  Expenses incurred in defending any such Proceeding by Executive the Company is required to indemnify as set forth above shall be paid or reimbursed by the Company promptly upon receipt by it of an undertaking of Executive to repay such expenses if it should ultimately be determined that Executive was not entitled to be indemnified by the Company.  It shall be the responsibility of the Company to obtain and keep current adequate liability insurance coverage to ensure that this provision shall be complied with as written.

 

9.             General Provisions.

 

(a)           Arbitration.  Any controversy or claim arising out of or relating to this Agreement or its breach shall be settled by arbitration in Las Vegas, Nevada, in accordance with the Commercial Arbitration Rules of the American Arbitration Association, and judgment on the award rendered by the arbitrator or arbitrators may be entered in any court having jurisdiction thereof.  Nothing contained in this section shall in any way deprive the Company of its right to obtain injunctive or other equitable relief under Section 5 of this Agreement.

 

(b)           Further assurances.  Each party shall execute all documents and take all other actions necessary to effect the provisions and purposes of this Agreement.

 

(c)           Entire agreement.  This Agreement contains the entire agreement between the parties and supersedes all other oral and written agreements previously entered into by the parties concerning the same subject matter, including the Prior Employment Agreement, provided, however, that except as modified by this Agreement, the terms and conditions of Executive’s employment with the Company shall be subject to the Company’s regular employment policies and practices as may be in effect from time to time.

 

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(d)           Modification, rescission, and assignment.  This Agreement may be modified or rescinded only with the written consent of both parties.  Neither this Agreement nor any right or interest under this Agreement shall be assignable by either party without the written consent of the other, provided, that nothing contained in this Agreement shall limit or restrict the Company’s ability to merge or consolidate or effect any similar transaction with any other entity, irrespective of whether the Company is the surviving entity (including a split up, spin off, or similar type transaction), provided that one or more of such surviving entities continues to be bound by the provisions of this Agreement.

 

(e)           Controlling law; severability.  Nevada law shall govern this Agreement and its interpretation.  If any provision is unenforceable for any reason, it shall be deemed stricken from the Agreement but shall not otherwise affect the intention of the parties or the remaining provisions of the Agreement.

 

(f)            Binding effect.  This Agreement shall bind and inure to the benefit of each of the parties and their respective heirs, successors, administrators, executors, and assigns.

 

(g)           Notices.  All notices required by this Agreement must be in writing and must be delivered, mailed, or telecopied to the addresses given above or such other addresses as the parties may designate in writing.

 

(h)           Counterparts; facsimiles.  This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which, taken together, shall constitute one and the same instrument.  This Agreement may be executed and delivered by exchange of facsimile copies showing the signatures of the parties, and those signatures need not be affixed to the same copy.  The facsimile copies so signed will constitute originally signed copies of the same consent requiring no further execution.

 

(i)            Captions; construction; drafting ambiguities.  The captions in this Agreement are for convenience only and shall not be used in interpreting it.  In interpreting this Agreement any change in gender or number shall be made as appropriate to fit the context.  Each party has reviewed and revised this Agreement with independent counsel or has had the opportunity to do so.  The rule of construction that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement or of any amendments or exhibits to this Agreement.

 

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of the date first set forth above.

 

	
BALLY   TECHNOLOGIES, INC. 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Kevin Verner
    	
 
    	
/s/   Ramesh Srinivasan
    
	
 
    	
Kevin   Verner, Chairman of the Board
    	
 
    	
Ramesh   Srinivasan
    

 

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