Document:

Exhibit
10.14

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT IS
SUBJECT TO THE

PROVISIONS OF SECTION 181.78 OF
THE MINNESOTA STATUTES

 

THIS AGREEMENT (“Agreement”)
is made and entered into effective July 1, 2004 (“Effective
Date”), by and between Southwest Casino and Hotel Corp., a Minnesota
corporation (“Employer”), and Jeffrey S.
Halpern (“Employee”).  Employee and Employer are collectively
referred to as the “Parties”.

 

BACKGROUND

 

A.            Employee
has been employed by Employer.

 

B.            The Parties wish to state the final
binding terms of Employee’s continued employment by Employer.

 

C.            The
Parties agree to the terms and conditions of Employee’s employment by Employer
stated in this Agreement.

 

AGREEMENT

 

In consideration of the Background and the Parties’
agreement as to Employee’s continuation of employment, the payment of
compensation and other benefits (as defined in this Agreement), the Parties’
mutual agreements stated in this Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which the Parties acknowledge,
the Parties agree as follows:

 

Section 1.  Employment
Terms and Duties.

 

Section 1.1  Term.  Subject to the provisions of Section 4 of
this Agreement regarding termination, Employer agrees to employ Employee and
Employee agrees to be employed by Employer for an initial term ending July 1,
2006 (the “Initial Term”), subject
to automatic renewal for additional one year terms unless terminated earlier in
accordance with Section 4.

 

Section 1.2 
Duties.

 

(a)           Employer employs Employee on a
full-time basis as its President, or in any other capacity that is commensurate
with Employee’s experience and current position and the Board of Directors of
Employer may, in its sole discretion, designate. Employee will perform any and all
duties as the Board of Directors may reasonably direct.

 

(b)           During the term of Employee’s
employment by Employer, Employee will devote Employee’s full attention and
energy to the performance of Employee’s duties to Employer.  Employee will perform Employee’s duties under
the supervision of and will report to an executive committee made up of the
President, the CEO and the Chairman of the Board of Directors (the “Executive Committee”). If no such
Executive Committee exists, Employee will report to the Board of Directors.
Employee warrants and represents to Employer that Employee has no contractual
commitments inconsistent with Employee’s obligations under this Agreement, and
that during the term of this Agreement, Employee will not render or perform
services for any other corporation, firm, entity or person which are
inconsistent with the provisions of this Agreement and which are not authorized
by Employer. For purposes of this Agreement, Employee and

 

1

 

Employer understand that Employee is permitted to
serve on outside Boards of Directors, provided that such service does not
interfere with Employee’s rendition of services to Employer and does not
violate any non-competition or other covenant in this Agreement.

 

Section 2.  Compensation

 

Section 2.1  Salary.  For all services rendered by Employee,
Employee shall receive (i) an annual salary of $220,000 (the “Salary”) from Employer for the term of Employee’s
employment under this Agreement, subject to annual adjustment as determined by
the compensation committee of the Board of Directors. Employer will pay the Salary in equal semi-monthly
installments in accordance with Employer’s standard payroll practices. For
purposes of this Section 2, “compensation committee” refers to the Board of
Directors of Employer, unless and until a compensation committee is
established.

 

Section
2.2 Bonus. Additional compensation in the form of a
bonus, if any, will be determined on a purely discretionary basis by the
compensation committee of the Board of Directors based upon Employer’s overall
performance, Employee’s individual performance and any other factors the
compensation committee deems appropriate.

 

Section 2.3  Benefits.  During the term of the Employee’s employment
under this Agreement, Employee is entitled to participate in the employee
benefits or benefit plans the Employer’s Board of Directors provides from time
to time to other full-time employees, including, but not limited to, health,
disability and life insurance. Employee’s health, disability and life insurance
must be commensurate with such benefits provided to Employee on the effective
date of this Agreement. However, Employer may unilaterally amend or terminate
all or any of the Employee’s benefits so long as any amendment or termination
applies to each and every employee of Employer and subject to the terms and
conditions of Employer’s benefit plans and applicable laws.

 

Section 2.4  Reimbursement of Expenses.  Employer will reimburse Employee for all
reasonable and necessary out-of-pocket expenses incurred at the request of
Employer in the performance of Employee’s duties under this Agreement provided
that Employee properly accounts to Employer for all expenses in accordance with
the rules and regulations of the Internal Revenue Service under the Internal
Revenue Code of 1986, as amended (the “Code”), and in accordance with the
standard policies of Employer relating to reimbursement of business expenses.
In addition, Employer will reimburse Employee up to $1,000 per month for
expenses related to Employee’s personal automobile.

 

Section 2.5 Option.  Upon the execution of this Agreement by the
Parties, Employer shall grant Employee a non-qualified option, exercisable for
five years, to purchase 600,000 (pre one-for-two split) shares of Employer’s
Common Stock at an exercise price of $0.50 per share for a total exercise price
equal to $300,000 (the “Option”).
The Option will become exercisable immediately as to 200,000 shares with the
remaining 400,000 shares becoming exercisable (a) as to 1/24th of
the remaining shares on the first day of each of the next 24 Months and (b) as
to 50 percent of any shares not then exercisable, on the date the State of
Missouri approves a law permitting construction and operation of a casino by
Employer at Rockaway Beach, Missouri or on the date the State of Minnesota
approves construction and operation of a harness-racing track by Employer in
the Twin Cities Metropolitan Area of Minnesota. The provisions of (b) are
cumulative such that if both the Rockaway Beach casino and the harness-racing
track are

 

2

 

approved, the Option will be exercisable as to all Option shares. If,
Employee’s employment with Employer terminates for any reason other than for
Cause (as defined in Section 4.4) or voluntary termination under Section
4.1(f), the Option will become exercisable as to all shares immediately upon
termination, except, if Employee’s employment continues under Section 4.2(c) of
this Agreement, the Option will become exercisable in accordance with this
Section 2.5 and will continue in force until the Option’s termination date.

 

Section 3. Restrictive Covenants.

 

Section 3.1  Confidential Information.  Employee acknowledges that the confidential
information and data obtained by Employee during the course of Employee’s
performance under this Agreement (or Employee’s work for Employer before the
date of this Agreement) concerning the business or affairs of Employer (the “Confidential Information”) are the property of
Employer.  Employee agrees that Employee
will not disclose to any unauthorized persons or use for Employee’s own account
or for the benefit of any third party any Confidential Information or data without
the written consent of the Chief Executive Officer of Employer during
Employee’s employment or for a period of three years after termination of
Employee’s employment. Employee agrees to deliver to Employer upon termination
of Employee’s employment all memoranda, notes, plans, records, reports and
other documentation (and copies of that documentation) relating to the business
of Employer that Employee may then possess or have under Employee’s control.

 

Section 3.2  Title.  Subject to the provisions of the attached
Exhibit B, all documents, inventions, designs or other tangible property
relating in any way to the business of Employer that are conceived or generated
by Employee or come into Employee’s possession during the Initial Term or any
extension of employment will be automatically assigned to and/or will be and
remain the exclusive property of Employer. Employee agrees to return all such
documents and tangible property including, but not limited to, all records,
manuals, books, blank forms, documents, letters, memoranda, notes, notebooks, reports,
data, financial information and copies of such documents and tangible property,
which are the property of Employer or which relate in any way to the business,
practices or techniques of Employer, and all other property of Employer,
including, but not limited to, all documents that in whole or in part contain
any Confidential Information of Employer that are in the possession or under
the control of Employee, to Employer upon termination of this Agreement,
Employee’s employment, or at any time upon request of Employer.

 

All ideas, designs, graphics, logos, slogans, copies,
software, derivative works and all other materials or intellectual property
relating in any way to the business of Employer created by or on behalf of
Employee in the course of Employee’s employment under this Agreement
automatically becomes the property of and is solely owned by Employer, its
successors, assigns, and licensees, in perpetuity, without reservation.
Furthermore, all rights of whatever nature affixed to such ideas, designs,
graphics, logos, slogans, copies, software, derivative works and other
materials or intellectual property relating in any way to the business of
Employer, including, without limitation, any trademark or service mark rights
or copyrights and any goodwill appurtenant to such rights, any right of
publicity, and any rights, title or interest which may affix under any
copyright laws now or hereafter in force and effect in the United States or any
other country or countries, automatically becomes the property of and is solely
owned by Employer, its successors, assigns and licensees, in perpetuity,
without reservation.

 

3

 

Section 3.4 Non-Competition
Covenant. In
consideration of the covenants of the Employer in this Agreement, the receipt
and sufficiency of which Employee acknowledges, Employee agrees that Employee will not at any time during his employment
with Employer, or for a period of one year after Employee’s last day of
employment with Employer, directly or indirectly own an interest in, join,
operate, control, manage or participate in or be connected as an officer,
employee, agent, independent contractor, consultant, partner, shareholder or
principal, or in any other manner with any Competitor within the Business
Territory. The term “Competitor” includes any Native American management
company, Indian tribe, or any person, firm, sole proprietorship, partnership,
association, limited liability company, corporation or other entity whatsoever
that engages in, or is about to engage in, any aspect of the gaming industry.
The term “Business Territory” includes the area within a 100 mile radius
of any location in which Employer has developed, or is in the process of
developing, as of the date of such termination, more than an insignificant
amount of business; provided, that, the phrase “in the process of developing”
includes any business that is at least the subject of a non-binding letter of
intent to which the applicable person or entity is party.  Notwithstanding anything to the contrary in
this Section 3.4, ownership by Employee, (y) of less than 2 percent of the
outstanding securities of a publicly-held corporation, or (z) as a passive
investment, of capital stock or other securities of any corporation dissimilar
from Employer, will not breach this Section 3.4.

 

Section 3.5 Non-Solicitation
Covenant. In consideration of the covenants of the
Employer in this Agreement, the receipt and sufficiency of which Employee
acknowledges, Employee agrees that for a period of one year after termination
of Employee’s employment with the Employer, the Employee will not directly or
indirectly:

 

(a)           Hire or solicit, or cause or induce
others to hire or solicit for employment, any employee of the Employer or
encourage any employee (including persons who were employed by Employer within
ninety (90) days before or after Employee’s termination date) to leave the
employment of the Employer.

 

(b)           Disparage or defame the Employer or
request or advise any customer, client, prospective client or vendor to curtail
or cancel their business relationship with Employer.

 

Section 3.6  Remedies.  Employee acknowledges that any violation of
Section 3 of this Agreement by Employee would result in immediate and
irreparable injury to Employer for which an award of money damages would not be
an adequate remedy. Employee agrees that employer has the right to obtain
equitable relief including an injunction to enforce specifically the terms of
this Agreement, and to obtain any other legal or equitable remedies that may be
available to Employer.

 

Section 3.7  Assignment.  The transfer of Employee from Employer to any
subsidiary, parent or affiliate, or to a successor company that results from
any acquisition, merger or reorganization of Employer will operate as an
assignment to that company of Employer’s rights under this Agreement, provided
that Employee’s position with the new entity must be commensurate with
Employee’s position with Employer immediately before such transfer and Employer
may not transfer Employee without Employee’s prior consent to any entity that
necessitates any relocation of Employee to a location that is more than 75
miles from Employee’s primary residence. The aforementioned assignment will not
terminate or modify this Agreement,

 

4

 

except that the company to which Employee is transferred will be
construed, for the purpose of this Agreement, as standing in the same place as
Employer as of the date of assignment. 
All covenants and agreements under this Agreement will inure to the
benefit of and be enforceable by the successors and assigns of Employer,
including assignees by operation of law.

 

Employee’s performance under this Agreement requires
Employee’s personal services, unique skills and experience and, therefore, may
not be assigned or transferred by Employee nor may Employee delegate Employee’s
duties under this Agreement to another person without the prior written consent
of the Board of Directors of Employer. 
Employer retains the exclusive right to withhold consent for any reason.

 

Section 3.8  Survival.  Except as otherwise provided expressly in
this Agreement, the provisions of this Section 3 will survive (a) the
termination of this Agreement as a result of breach or otherwise, or (b) the
termination of Employee’s employment under this Agreement. However, if Employer
breaches Employer’s obligation to make any payments to Employee under this
Agreement, the provisions of Section 3.4 and 3.5 of this Agreement will not
survive a termination of this Agreement for so long as such breach remains
uncured.

 

Section 4. Termination

 

Section 4.1 Grounds for
Termination. This
Agreement will terminate prior to the expiration of the Initial Term stated in
Section 1.1 or any renewal term if at any time during the Initial Term or any
renewal term:

 

(a)           Employer
elects to terminate this Agreement for “Cause” (as defined in Section 4.4
below) and notifies Employee in writing of such election,

 

(b)           Employee becomes “Disabled” (as
defined in Section 4.5 below),

 

(c)           Employee dies,

 

(d)           Employer elects to terminate this
Agreement for no reason or for any reason other than for “Cause” (as defined in
Section 4.4 below) and notifies Employee in writing of such election,

 

(e)           Employee voluntarily terminates his
employment for “Good Reason” (as defined in Section 4.6 below) and notifies
Employer in writing of such election,

 

(f)            Employee voluntarily terminates his
employment for no reason or for any reason other than a “Good Reason” (as
defined in Section 4.6 below), or

 

(g)           Employee and Employer mutually agree
to terminate this Agreement.

 

Section 4.2 Termination Date
and Payment to Employee.

 

(a)           If this Agreement is terminated under
subsection (a) or (f) of Section 4.1, termination will be effective immediately
and no further payments of Salary, Bonus or other forms of compensation or
benefits will be due or payable to Employee with respect to any period after or
events occurring after the date of termination, except as may be required by
applicable law, and all vested options may be exercised for only 30 days.

 

(b)           If this Agreement is terminated under
subsection (b) or (c) of Section 4.1, termination will be effective
immediately, except that Employer must pay to Employee’s

 

5

 

beneficiaries or estate, in the case of death, or to Employee, in the
case of disability, a termination payment equal to the Base Salary at the
annual rate in effect as of the date of termination for (i) a period of 90 days
or (ii) the remainder of the term of this Agreement, whichever is less (the “Termination Payment”); provided that the amount of any
Termination Payment will be reduced by the amount of any death or disability
payments payable to the Employee under anydeath or disability insurance
coverage in effect as of the date of termination.

 

(c)           If either party elects to terminate
this Agreement under subsections (d) or (e) of Section 4.1, termination will be
effective thirty (30) days after delivery of written notice of termination to
the other party and subject to Employee’s right to elect to continue employment
with Employer under this Agreement on the following terms:

 

(i)            Employer
will employ Employee for the minimum number of hours per pay period required
for Employee to qualify for fullbenefits under Employer’s benefit plans;

 

(ii)           Employee will perform those duties
assigned to Employee by the Board of Directors or other member of the Executive
Committee; and

 

(iii)          In consideration of Employee’s
continued service to Employer and the continuation of Employee’s
non-competition and non-solicitation covenants under Sections 3.4 and 3.5,
Employee will be paid Employee’s base salary at the time of termination for a
period of 18 months, and after 18 months, a salary equal to not less than
$25,000 per year (or such other amount as required to maintain Employee’s
eligibility under Employer’s health insurance plan), and, subject to Section
2.3 of this Agreement, continuation of all benefits provided under Employer’s
health insurance plan.

 

(d)           If this Agreement is terminated under
subsection (g) of Section 4.1, termination will be effective as of the date
agreed upon by the Parties and Employee will be entitled to receive
compensation due to the Employee through the last day of employment or as
otherwise agreed upon by the Parties.

 

Section 4.3 Exercise of
Unexpired Stock Options. Except as stated in this Agreement, the termination of this Agreement,
the vesting and exercisability of stock options or other incentive awards held
by the Employee as of the termination date will be controlled by the terms of
the individual agreement or agreements evidencing such options or other
incentive awards.

 

Section 4.4 “Cause” Defined. As used in this Agreement, “Cause” means:

 

(a)           conviction of Employee for any
fraudulent or criminal act in connection with Employer’s business;

 

(b)           proven malfeasance by Employee in
connection with Employer’s business; or

 

(c)           a final determination by any
regulatory body to which Employer is subject, that Employee’s continued
employment with Employer will result in (i) the disapproval, modification, or
non-renewal of any contract or proposed contract under which the Employer or
any of its subsidiaries has sole or shared authority to develop, license or

 

6

 

manage any gaming operations, wherever located, or
(ii) the disapproval, loss, modification, non-renewal or non-reinstatement of
any license, franchise, approval or consent issued by or sought from any
federal, state or tribal governmental authority with respect to the conduct of
any portion of the business of the Employer or any subsidiary.

 

Section 4.5 “Disabled” Defined.  As used in this Agreement, “Disabled” means any mental or physical
condition that renders Employee unable to perform the essential functions of
his position, with or without reasonable accommodation, as defined by various
state and federal disability laws. Employee is presumed to have such a
disability for the purpose of this Agreement if Employee qualifies because of
illness or incapacity to begin receiving disability income insurance payments
under any long-term disability income insurance policy that Employer maintains
for the benefit of Employee. If there is no long-term disability policy in
effect at the date of Employee’s illness or incapacity, Employee is presumed to
have such a disability for the purpose of this Agreement if Employee is
substantially incapable of performing his duties for a period of more than
twelve (12) consecutive weeks or as may otherwise be required by applicable
law.

 

Section 4.6 “Good Reason”
Defined. As used
in this Agreement, “Good Reason” means (a) the assignment to Employee of any
duties and responsibilities materially inconsistent with the position that
Employee holds as of the date Employee enters into this Agreement, (b) a
material adverse alteration or diminishment in the nature or status of Employee
or the Employee’s duties and responsibilities or conditions of employment from
those in effect as of the date Employee enters into this Agreement; (c)
relocation of the Employee to an office or site more than 75 miles from the
Employee’s primary job location as of the date Employee enters into this
Agreement; (d) after the Initial Term, a determination by Employee that Employee
and Employer would be better served by Employee assuming fewer responsibilities
on behalf of Employer than may be required under this Agreement; or (e) a
change in the organizational structure of Employer, requiring the Employee to
report to person(s) other than the Executive Committee or the Board of
Directors of Employer; provided, that in the case of clause (a) or (b), the
Employee has provided Employer with written notice detailing the reasons why he
believes the criteria specified in clause (a) or (b) has been satisfied and
Employer does not resolve such issue to the reasonable satisfaction of the
Employee within 30 days after receipt of such notice.

 

Section 4.7  Effect of Termination. Notwithstanding termination of this
Agreement, Employee, in consideration of his employment under this Agreement up
to the date of termination, remains bound by the provisions of this Agreement
that relate specifically to periods, activities or obligations existing upon or
subsequent to the termination of Employee’s employment.

 

Section 5. Change in Control.

 

Section 5.1 “Change in
Control” Defined.
For purposes of this Agreement, “Change in Control” means:

 

(a)           any
merger, acquisition, reorganization or consolidation of Employer into or with
any other entity or entities that results in the exchange of outstanding shares
of Employer for securities or other consideration issued or paid or caused to
be issued or paid by any such entity or affiliate of such entity under which
the shareholders of 

 

7

 

Employer immediately prior to the transaction do not
own a majority of the outstanding shares of the surviving corporation
immediately after the transaction;

 

(b)           any sale, lease, license (on an
exclusive basis), or transfer by Employer of all or substantially all its
assets, or an exclusive license granted by Employer of substantially all of its
intellectual property to a third party, or a liquidation of Employer;

 

(c)           any statutory exchange of securities
with another entity (except where Employer is the acquiring entity);

 

(d)           the
acquisition of ownership by any person or group of more than 50% of Employer’s
outstanding voting stock from existing shareholders (whether or not approved by
Employer’s Board of Directors) after the date of this Agreement, provided that
this subsection (d) will not apply to the closing of the issuance and sale of
Employer’s securities in an underwritten public offering, the issuance of
Employer capital stock under a registration of its shares under the Securities
Act of 1933, as amended, or under a private placement of Employer capital stock
exempt from the registration requirements of the Securities Act;

 

(e)           the “Continuity Directors” (as
defined below) cease to constitute a majority of Employer’s Board of Directors;
or

 

(f)            any other change of control (except
as a result of one or more venture capital financings or other similar
transactions involving institutional funding) that would be required by the
Securities and Exchange Commission to be reported if Employer were a public
company, including successive series of such transactions.

 

For purposes of this Section
5.1, “Continuity Directors” means any individuals who are members of Employer’s
Board of Directors as of the date of this Agreement and any individual who
subsequently becomes a member of Employer’s Board of Directors whose election,
or nomination for election, by Employer’s shareholders was approved by a vote
of at least a majority of the Continuity Directors.

 

Section 5.2 Remedies for
“Change in Control”.  If, with or without the consent
of Employer, a Change in Control occurs and within nine months after that
Change in Control, either Employer terminates Employee’s employment under
Section 4.1(d) above or the Employee terminates his employment under Section
4.1(e) above, Employee is entitled to exercise Employee’s rights under Section
4.2(c) of this Agreement and all unexpired stock options held by Employee as of
the termination date will vest immediately, notwithstanding the provisions of any
option agreement between Employee and Employer to the contrary, in accordance
with the provisions of Section 4.3 above.

 

Section 6. Provisions of General Application

 

Section 6.1  Background Checks and Related Information.  Employee acknowledges that Employer’s gaming
business is extensively regulated and, as a result, various regulatory bodies
may request or require background investigations and background information
regarding Employee. During the term of this Agreement, Employee agrees to
comply with any and all background investigations conducted or requested from
time to time by Employer or any federal,

 

8

 

state, tribal or other regulatory authority. Employee acknowledges and
agrees that the provisions of this Section 5.1 are a material part of this
Agreement.

 

Section 6.2  Notices.  All notices, requests and other
communications from any of the Parties to this Agreement to any of the other
Parties must be in writing and, except as otherwise provided in this Agreement,
will be considered to have been duly given or served if sent by certified or
registered United States mail, postage prepaid, return receipt requested, to
the respective Parties at the address stated below or to any other address a
Party may designate by notice to the other Party.

 

	
   

  	
  As to Employer:

  	
  Southwest Casino and Hotel Corp.

  
	
   

  	
   

  	
  2001 Killebrew Drive, Suite 306

  
	
   

  	
   

  	
  Minneapolis, MN 
  55425

  
	
   

  	
   

  	
   

  
	
   

  	
  As to Employee:

  	
  Mr. Jeffrey Halpern

  
	
   

  	
   

  	
  6617 Pawnee Road

  
	
   

  	
   

  	
  Edina, MN 55439

  

 

 

Section 6.3  Amendment.  Only a writing signed by both Employer and
Employee may amend this Agreement.

 

Section 6.4  Parties in Interest.  This Agreement is binding upon, and the
benefits and obligations of this Agreement inure to the Parties and their
respective heirs, legal representatives, successors, assigns, transferees or
donees.

 

Section 6.6  Entire Agreement.  The Parties intend this Agreement as the
final and binding expression of their agreement and as the complete and
exclusive statement of its terms.  This
Agreement supersedes and revokes all other prior negotiations, representations
and agreements, whether oral or written, regarding the employment relationship
between Employer and Employee.

 

Section 6.7 Enforceability.  If any provision in this Agreement is declared
unenforceable or invalid, that declaration will not impair any other provision
of the Agreement, each of which will be enforced according to their respective
terms.

 

Section 6.8  Construction.  The headings of the paragraphs of this
Agreement are for the purpose of identification only and must not be used for
the construction or interpretation of any portion of this Agreement. Waiver by
any Party of any default, violation or nonperformance under this Agreement will
not be deemed a waiver of that Party’s right to seek legal or equitable relief
for any subsequent violation of the Agreement. As used in this Agreement and
where necessary, the singular includes the plural and vice versa, and
masculine, feminine and neuter expressions are interchangeable.

 

Section 6.9  Applicable Law.  This Agreement was made and entered into in
Minnesota, and the laws of the State of Minnesota govern and apply to this
Agreement and any enforcement, construction or interpretation of this
Agreement.

 

IN WITNESS WHEREOF,
Employer and Employee have knowingly, voluntarily and with the right to seek
independent counsel, executed this Agreement on the date(s) reflected below
with the Effective Date as stated above.

 

9

 

 

	
  DATE:  July 21, 2004

  	
  DATE:  July 21, 2004

  
	
   

  	
   

  
	
  EMPLOYEE

  	
  SOUTHWEST CASINO AND

  
	
   

  	
  HOTEL
  CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  	
   

  
	
  Jeffrey S. Halpern

  	
   

  	
  Thomas E. Fox,
  President

  	
   

  
					

 

10

 

EXHIBIT B

 

NOTICE UNDER

 

MINNESOTA STATUTES 181.78 (Subd. 3)

 

	
  TO:

  	
   

  	
  Jeff Halpern

  
	
   

  	
   

  	
   

  
	
  FROM:

  	
   

  	
  Southwest Casino and Hotel Corp. (the “Employer”)

  

 

You have entered into an Employment Agreement with
Employer requiring you, among other things, to assign or offer to assign your
rights in certain inventions to Employer. 
You are hereby notified that the Employment Agreement does not apply to
any invention for which no equipment, supplies, facility or trade secret
information of Employer was used and which was developed entirely on your own
time, and (1) which does not relate (a) directly to the business of Employer,
or (b) to Employer’s actual or demonstrably anticipated research or
development; or (2) which does not result from any work performed by you for
Employer.

 

	
   

  	
  SOUTHWEST CASINO AND HOTEL CORP.

  
	
   

  
	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Its

  	
   

  	
   

  
	
   

  
	
   

  
	
  I hereby acknowledge receipt of the foregoing
  notice.

  
	
   

  
	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Jeffrey S. Halpern

  
					

 

11Exhibit
10.15

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT IS
SUBJECT TO THE

PROVISIONS OF SECTION 181.78 OF
THE MINNESOTA STATUTES

 

THIS AGREEMENT (“Agreement”)
is made and entered into effective July 1, 2004 (“Effective
Date”), by and between Southwest Casino and Hotel Corp., a Minnesota
corporation (“Employer”), and Thomas E. Fox (“Employee”). 
Employee and Employer are collectively referred to as the “Parties”.

 

BACKGROUND

 

A.            Employee
has been employed by Employer.

 

B.            The
Parties wish to state the final binding terms of Employee’s continued
employment by Employer.

 

C.            The
Parties agree to the terms and conditions of Employee’s employment by Employer
stated in this Agreement.

 

AGREEMENT

 

In consideration of the Background and the Parties’
agreement as to Employee’s commencement or continuation of employment, the
payment of compensation and other benefits (as defined in this Agreement), the
Parties’ mutual agreements stated in this Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which the Parties
acknowledge, the Parties agree as follows:

 

Section 1.  Employment
Terms and Duties.

 

Section 1.1  Term.  Subject to the provisions of Section 4 of
this Agreement regarding termination, Employer agrees to employ Employee and
Employee agrees to be employed by Employer for an initial term ending July 1,
2006 (the “Initial Term”), subject
to automatic renewal for additional one year terms unless terminated earlier in
accordance with Section 4.

 

Section 1.2 
Duties.

 

(a)           Employer employs Employee on a
full-time basis as its President, or in any other capacity that is commensurate
with Employee’s experience and current position and the Board of Directors of
Employer may, in its sole discretion, designate. Employee will perform any and
all duties as the Board of Directors may reasonably direct.

 

(b)           During the term of Employee’s
employment by Employer, Employee will devote Employee’s full attention and
energy to the performance of Employee’s duties to Employer.  Employee will perform Employee’s duties under
the supervision of and will report to an executive committee made up of the
President, the CEO and the Chairman of the Board of Directors (the “Executive Committee”). If no such
Executive Committee exists, Employee will report to the Board of Directors.
Employee warrants and represents to Employer that Employee has no contractual
commitments inconsistent with Employee’s obligations under this Agreement, and
that during the term of this Agreement, Employee will not render or perform
services for any other corporation, firm, entity or person which are
inconsistent with the provisions of this Agreement and which are not authorized
by Employer. For purposes of this Agreement, Employee and

 

1

 

Employer understand that Employee is permitted to
serve on outside Boards of Directors, provided that such service does not
interfere with Employee’s rendition of services to Employer and does not
violate any non-competition or other covenant in this Agreement.

 

Section 2.  Compensation

 

Section 2.1  Salary.  For all services rendered by Employee,
Employee shall receive (i) an annual salary of $220,000 (the “Salary”) from Employer for the term of Employee’s
employment under this Agreement, subject to annual adjustment as determined by
the compensation committee of the Board of Directors. Employer will pay the Salary in equal semi-monthly
installments in accordance with Employer’s standard payroll practices. For
purposes of this Section 2, “compensation committee” refers to the Board of
Directors of Employer, unless and until a compensation committee is
established.

 

Section
2.2 Bonus. Additional compensation in the form of a
bonus, if any, will be determined on a purely discretionary basis by the compensation
committee of the Board of Directors based upon Employer’s overall performance,
Employee’s individual performance and any other factors the compensation
committee deems appropriate.

 

Section 2.3  Benefits.  During the term of the Employee’s employment
under this Agreement, Employee is entitled to participate in the employee
benefits or benefit plans the Employer’s Board of Directors provides from time
to time to other full-time employees, including, but not limited to, health,
disability and life insurance. Employee’s health, disability and life insurance
must be commensurate with such benefits provided to Employee on the effective
date of this Agreement. However, Employer may unilaterally amend or terminate
all or any of the Employee’s benefits so long as any amendment or termination
applies to each and every employee of Employer and subject to the terms and
conditions of Employer’s benefit plans and applicable laws.

 

Section 2.4  Reimbursement of Expenses.  Employer will reimburse Employee for all reasonable
and necessary out-of-pocket expenses incurred at the request of Employer in the
performance of Employee’s duties under this Agreement provided that Employee
properly accounts to Employer for all expenses in accordance with the rules and
regulations of the Internal Revenue Service under the Internal Revenue Code of
1986, as amended (the “Code”), and in accordance with the standard policies of
Employer relating to reimbursement of business expenses. In addition, Employer
will reimburse Employee up to $1,000 per month for expenses related to
Employee’s personal automobile.

 

Section 2.5 Option.  Upon the execution of this Agreement by the
Parties, Employer shall grant Employee a non-qualified option, exercisable for
five years, to purchase 600,000 (pre one-for-two split) shares of Employer’s
Common Stock at an exercise price of $0.50 per share for a total exercise price
equal to $300,000 (the “Option”).
The Option will become exercisable immediately as to 200,000 shares with the
remaining 400,000 shares becoming exercisable (a) as to 1/24th of
the remaining shares on the first day of each of the next 24 Months and (b) as
to 50 percent of any shares not then exercisable, on the date the State of
Missouri approves a law permitting construction and operation of a casino by
Employer at Rockaway Beach, Missouri or on the date the State of Minnesota
approves construction and operation of a harness-racing track by Employer in
the Twin Cities Metropolitan Area of Minnesota. The provisions of (b) are
cumulative such that if both the Rockaway Beach casino and the harness-racing
track are

 

2

 

approved, the Option will be exercisable as to all Option shares. If,
Employee’s employment with Employer terminates for any reason other than for
Cause (as defined in Section 4.4) or voluntary termination under Section
4.1(f), the Option will become exercisable as to all shares immediately upon
termination, except, if Employee’s employment continues under Section 4.2(c) of
this Agreement, the Option will become exercisable in accordance with this
Section 2.5 and will continue in force until the Option’s termination date.

 

Section 3. Restrictive Covenants.

 

Section 3.1  Confidential Information.  Employee acknowledges that the confidential
information and data obtained by Employee during the course of Employee’s
performance under this Agreement (or Employee’s work for Employer before the
date of this Agreement) concerning the business or affairs of Employer (the “Confidential Information”) are the property of
Employer.  Employee agrees that Employee
will not disclose to any unauthorized persons or use for Employee’s own account
or for the benefit of any third party any Confidential Information or data
without the written consent of the Chief Executive Officer of Employer during
Employee’s employment or for a period of three years after termination of
Employee’s employment. Employee agrees to deliver to Employer upon termination
of Employee’s employment all memoranda, notes, plans, records, reports and
other documentation (and copies of that documentation) relating to the business
of Employer that Employee may then possess or have under Employee’s control.

 

Section 3.2  Title.  Subject to the provisions of the attached
Exhibit B, all documents, inventions, designs or other tangible property
relating in any way to the business of Employer that are conceived or generated
by Employee or come into Employee’s possession during the Initial Term or any
extension of employment will be automatically assigned to and/or will be and
remain the exclusive property of Employer. Employee agrees to return all such
documents and tangible property including, but not limited to, all records,
manuals, books, blank forms, documents, letters, memoranda, notes, notebooks,
reports, data, financial information and copies of such documents and tangible
property, which are the property of Employer or which relate in any way to the
business, practices or techniques of Employer, and all other property of
Employer, including, but not limited to, all documents that in whole or in part
contain any Confidential Information of Employer that are in the possession or
under the control of Employee, to Employer upon termination of this Agreement,
Employee’s employment, or at any time upon request of Employer.

 

All ideas, designs, graphics, logos, slogans, copies,
software, derivative works and all other materials or intellectual property
relating in any way to the business of Employer created by or on behalf of
Employee in the course of Employee’s employment under this Agreement
automatically becomes the property of and is solely owned by Employer, its
successors, assigns, and licensees, in perpetuity, without reservation.
Furthermore, all rights of whatever nature affixed to such ideas, designs,
graphics, logos, slogans, copies, software, derivative works and other
materials or intellectual property relating in any way to the business of
Employer, including, without limitation, any trademark or service mark rights
or copyrights and any goodwill appurtenant to such rights, any right of
publicity, and any rights, title or interest which may affix under any
copyright laws now or hereafter in force and effect in the United States or any
other country or countries, automatically becomes the property of and is solely
owned by Employer, its successors, assigns and licensees, in perpetuity,
without reservation.

 

3

 

Section 3.4 Non-Competition
Covenant. In
consideration of the covenants of the Employer in this Agreement, the receipt
and sufficiency of which Employee acknowledges, Employee agrees that Employee will not at any time during his employment
with Employer, or for a period of one year after Employee’s last day of
employment with Employer, directly or indirectly own an interest in, join,
operate, control, manage or participate in or be connected as an officer,
employee, agent, independent contractor, consultant, partner, shareholder or
principal, or in any other manner with any Competitor within the Business
Territory. The term “Competitor” includes any Native American management
company, Indian tribe, or any person, firm, sole proprietorship, partnership,
association, limited liability company, corporation or other entity whatsoever
that engages in, or is about to engage in, any aspect of the gaming industry.
The term “Business Territory” includes the area within a 100 mile radius
of any location in which Employer has developed, or is in the process of
developing, as of the date of such termination, more than an insignificant
amount of business; provided, that, the phrase “in the process of developing”
includes any business that is at least the subject of a non-binding letter of
intent to which the applicable person or entity is party.  Notwithstanding anything to the contrary in
this Section 3.4, ownership by Employee, (y) of less than 2 percent of the
outstanding securities of a publicly-held corporation, or (z) as a passive
investment, of capital stock or other securities of any corporation dissimilar
from Employer, will not breach this Section 3.4.

 

Section 3.5 Non-Solicitation
Covenant. In consideration of the covenants of the
Employer in this Agreement, the receipt and sufficiency of which Employee
acknowledges, Employee agrees that for a period of one year after termination
of Employee’s employment with the Employer, the Employee will not directly or
indirectly:

 

(a)           Hire or solicit, or cause or induce
others to hire or solicit for employment, any employee of the Employer or
encourage any employee (including persons who were employed by Employer within
ninety (90) days before or after Employee’s termination date) to leave the
employment of the Employer.

 

(b)           Disparage or defame the Employer or
request or advise any customer, client, prospective client or vendor to curtail
or cancel their business relationship with Employer.

 

Section 3.6  Remedies.  Employee acknowledges that any violation of
Section 3 of this Agreement by Employee would result in immediate and
irreparable injury to Employer for which an award of money damages would not be
an adequate remedy. Employee agrees that employer has the right to obtain
equitable relief including an injunction to enforce specifically the terms of
this Agreement, and to obtain any other legal or equitable remedies that may be
available to Employer.

 

Section 3.7  Assignment.  The transfer of Employee from Employer to any
subsidiary, parent or affiliate, or to a successor company that results from
any acquisition, merger or reorganization of Employer will operate as an
assignment to that company of Employer’s rights under this Agreement, provided
that Employee’s position with the new entity must be commensurate with
Employee’s position with Employer immediately before such transfer and Employer
may not transfer Employee without Employee’s prior consent to any entity that
necessitates any relocation of Employee to a location that is more than 75
miles from Employee’s primary residence. The aforementioned assignment will not
terminate or modify this Agreement,

 

4

 

except that the company to which Employee is transferred will be
construed, for the purpose of this Agreement, as standing in the same place as
Employer as of the date of assignment. 
All covenants and agreements under this Agreement will inure to the
benefit of and be enforceable by the successors and assigns of Employer,
including assignees by operation of law.

 

Employee’s performance under this Agreement requires
Employee’s personal services, unique skills and experience and, therefore, may
not be assigned or transferred by Employee nor may Employee delegate Employee’s
duties under this Agreement to another person without the prior written consent
of the Board of Directors of Employer. 
Employer retains the exclusive right to withhold consent for any reason.

 

Section 3.8  Survival.  Except as otherwise provided expressly in
this Agreement, the provisions of this Section 3 will survive (a) the
termination of this Agreement as a result of breach or otherwise, or (b) the
termination of Employee’s employment under this Agreement. However, if Employer
breaches Employer’s obligation to make any payments to Employee under this
Agreement, the provisions of Section 3.4 and 3.5 of this Agreement will not survive
a termination of this Agreement for so long as such breach remains uncured.

 

Section 4. Termination

 

Section 4.1 Grounds for
Termination. This
Agreement will terminate prior to the expiration of the Initial Term stated in
Section 1.1 or any renewal term if at any time during the Initial Term or any
renewal term:

 

(a)           Employer
elects to terminate this Agreement for “Cause” (as defined in Section 4.4
below) and notifies Employee in writing of such election,

 

(b)           Employee becomes “Disabled” (as
defined in Section 4.5 below),

 

(c)           Employee dies,

 

(d)           Employer elects to terminate this
Agreement for no reason or for any reason other than for “Cause” (as defined in
Section 4.4 below) and notifies Employee in writing of such election,

 

(e)           Employee voluntarily terminates his
employment for “Good Reason” (as defined in Section 4.6 below) and notifies
Employer in writing of such election,

 

(f)            Employee voluntarily terminates his
employment for no reason or for any reason other than a “Good Reason” (as
defined in Section 4.6 below), or

 

(g)           Employee and Employer mutually agree
to terminate this Agreement.

 

Section 4.2 Termination Date
and Payment to Employee.

 

(a)           If this Agreement is terminated under
subsection (a) or (f) of Section 4.1, termination will be effective immediately
and no further payments of Salary, Bonus or other forms of compensation or
benefits will be due or payable to Employee with respect to any period after or
events occurring after the date of termination, except as may be required by
applicable law, and all vested options may be exercised for only 30 days.

 

(b)           If this Agreement is terminated under
subsection (b) or (c) of Section 4.1, termination will be effective
immediately, except that Employer must pay to Employee’s

 

5

 

beneficiaries or estate, in the case of death, or to
Employee, in the case of disability, a termination payment equal to the Base
Salary at the annual rate in effect as of the date of termination for (i) a
period of 90 days or (ii) the remainder of the term of this Agreement,
whichever is less (the “Termination Payment”);
provided that the amount of any Termination Payment will be reduced by the
amount of any death or disability payments payable to the Employee under
anydeath or disability insurance coverage in effect as of the date of
termination.

 

(c)           If either party elects to terminate
this Agreement under subsections (d) or (e) of Section 4.1, termination will be
effective thirty (30) days after delivery of written notice of termination to
the other party and subject to Employee’s right to elect to continue employment
with Employer under this Agreement on the following terms:

 

(i)            Employer
will employ Employee for the minimum number of hours per pay period required
for Employee to qualify for fullbenefits under Employer’s benefit plans;

 

(ii)           Employee will perform those duties
assigned to Employee by the Board of Directors or other member of the Executive
Committee; and

 

(iii)          In consideration of Employee’s
continued service to Employer and the continuation of Employee’s
non-competition and non-solicitation covenants under Sections 3.4 and 3.5,
Employee will be paid Employee’s base salary at the time of termination for a
period of 18 months, and after 18 months, a salary equal to not less than
$25,000 per year (or such other amount as required to maintain Employee’s
eligibility under Employer’s health insurance plan), and, subject to Section
2.3 of this Agreement, continuation of all benefits provided under Employer’s
health insurance plan.

 

(d)           If
this Agreement is terminated under subsection (g) of Section 4.1, termination
will be effective as of the date agreed upon by the Parties and Employee will
be entitled to receive compensation due to the Employee through the last day of
employment or as otherwise agreed upon by the Parties.

 

Section 4.3 Exercise of
Unexpired Stock Options. Except as stated in this Agreement, the termination of this Agreement,
the vesting and exercisability of stock options or other incentive awards held
by the Employee as of the termination date will be controlled by the terms of
the individual agreement or agreements evidencing such options or other
incentive awards.

 

Section 4.4 “Cause” Defined. As used in this Agreement, “Cause” means:

 

(a)           conviction of Employee for any
fraudulent or criminal act in connection with Employer’s business;

 

(b)           proven malfeasance by Employee in
connection with Employer’s business; or

 

(c)           a final determination by any
regulatory body to which Employer is subject, that Employee’s continued
employment with Employer will result in (i) the disapproval, modification, or
non-renewal of any contract or proposed contract under which the Employer or
any of its subsidiaries has sole or shared authority to develop, license or

 

6

 

manage any gaming operations, wherever located, or
(ii) the disapproval, loss, modification, non-renewal or non-reinstatement of
any license, franchise, approval or consent issued by or sought from any
federal, state or tribal governmental authority with respect to the conduct of
any portion of the business of the Employer or any subsidiary.

 

Section 4.5 “Disabled” Defined.  As used in this Agreement, “Disabled” means any mental or physical
condition that renders Employee unable to perform the essential functions of
his position, with or without reasonable accommodation, as defined by various
state and federal disability laws. Employee is presumed to have such a
disability for the purpose of this Agreement if Employee qualifies because of
illness or incapacity to begin receiving disability income insurance payments
under any long-term disability income insurance policy that Employer maintains
for the benefit of Employee. If there is no long-term disability policy in effect
at the date of Employee’s illness or incapacity, Employee is presumed to have
such a disability for the purpose of this Agreement if Employee is
substantially incapable of performing his duties for a period of more than
twelve (12) consecutive weeks or as may otherwise be required by applicable
law.

 

Section 4.6 “Good Reason”
Defined. As used
in this Agreement, “Good Reason” means (a) the assignment to Employee of any
duties and responsibilities materially inconsistent with the position that
Employee holds as of the date Employee enters into this Agreement, (b) a
material adverse alteration or diminishment in the nature or status of Employee
or the Employee’s duties and responsibilities or conditions of employment from
those in effect as of the date Employee enters into this Agreement; (c)
relocation of the Employee to an office or site more than 75 miles from the
Employee’s primary job location as of the date Employee enters into this
Agreement; (d) after the Initial Term, a determination by Employee that
Employee and Employer would be better served by Employee assuming fewer
responsibilities on behalf of Employer than may be required under this
Agreement; or (e) a change in the organizational structure of Employer,
requiring the Employee to report to person(s) other than the Executive
Committee or the Board of Directors of Employer; provided, that in the case of
clause (a) or (b), the Employee has provided Employer with written notice
detailing the reasons why he believes the criteria specified in clause (a) or
(b) has been satisfied and Employer does not resolve such issue to the
reasonable satisfaction of the Employee within 30 days after receipt of such
notice.

 

Section 4.7  Effect of Termination. Notwithstanding termination of this
Agreement, Employee, in consideration of his employment under this Agreement up
to the date of termination, remains bound by the provisions of this Agreement
that relate specifically to periods, activities or obligations existing upon or
subsequent to the termination of Employee’s employment.

 

Section 5. Change in Control.

 

Section 5.1 “Change in
Control” Defined.
For purposes of this Agreement, “Change in Control” means:

 

(a)           any
merger, acquisition, reorganization or consolidation of Employer into or with
any other entity or entities that results in the exchange of outstanding shares
of Employer for securities or other consideration issued or paid or caused to
be issued or paid by any such entity or affiliate of such entity under which
the shareholders of

 

7

 

Employer immediately prior to the transaction do not
own a majority of the outstanding shares of the surviving corporation
immediately after the transaction;

 

(b)           any sale, lease, license (on an
exclusive basis), or transfer by Employer of all or substantially all its
assets, or an exclusive license granted by Employer of substantially all of its
intellectual property to a third party, or a liquidation of Employer;

 

(c)           any statutory exchange of securities
with another entity (except where Employer is the acquiring entity);

 

(d)           the
acquisition of ownership by any person or group of more than 50% of Employer’s
outstanding voting stock from existing shareholders (whether or not approved by
Employer’s Board of Directors) after the date of this Agreement, provided that
this subsection (d) will not apply to the closing of the issuance and sale of
Employer’s securities in an underwritten public offering, the issuance of
Employer capital stock under a registration of its shares under the Securities
Act of 1933, as amended, or under a private placement of Employer capital stock
exempt from the registration requirements of the Securities Act;

 

(e)           the “Continuity Directors” (as
defined below) cease to constitute a majority of Employer’s Board of Directors;
or

 

(f)            any other change of control (except
as a result of one or more venture capital financings or other similar
transactions involving institutional funding) that would be required by the
Securities and Exchange Commission to be reported if Employer were a public
company, including successive series of such transactions.

 

For purposes of this Section
5.1, “Continuity Directors” means any individuals who are members of Employer’s
Board of Directors as of the date of this Agreement and any individual who
subsequently becomes a member of Employer’s Board of Directors whose election,
or nomination for election, by Employer’s shareholders was approved by a vote
of at least a majority of the Continuity Directors.

 

Section 5.2 Remedies for
“Change in Control”.  If, with or without the consent
of Employer, a Change in Control occurs and within nine months after that
Change in Control, either Employer terminates Employee’s employment under
Section 4.1(d) above or the Employee terminates his employment under Section
4.1(e) above, Employee is entitled to exercise Employee’s rights under Section
4.2(c) of this Agreement and all unexpired stock options held by Employee as of
the termination date will vest immediately, notwithstanding the provisions of
any option agreement between Employee and Employer to the contrary, in
accordance with the provisions of Section 4.3 above.

 

Section 6. Provisions of General Application

 

Section 6.1  Background Checks and Related Information.  Employee acknowledges that Employer’s gaming
business is extensively regulated and, as a result, various regulatory bodies
may request or require background investigations and background information
regarding Employee. During the term of this Agreement, Employee agrees to comply
with any and all background investigations conducted or requested from time to
time by Employer or any federal,

 

8

 

state, tribal or other regulatory authority. Employee acknowledges and
agrees that the provisions of this Section 5.1 are a material part of this
Agreement.

 

Section 6.2  Notices.  All notices, requests and other
communications from any of the Parties to this Agreement to any of the other
Parties must be in writing and, except as otherwise provided in this Agreement,
will be considered to have been duly given or served if sent by certified or
registered United States mail, postage prepaid, return receipt requested, to
the respective Parties at the address stated below or to any other address a
Party may designate by notice to the other Party.

 

	
  As to Employer:

  	
   

  	
  Southwest Casino and Hotel Corp.

  
	
   

  	
   

  	
  2001 Killebrew Drive, Suite 306

  
	
   

  	
   

  	
  Minneapolis, MN 
  55425

  
	
   

  	
   

  	
   

  
	
  As to Employee:

  	
   

  	
  Mr. Thomas Fox

  
	
   

  	
   

  	
  5801 Hyland Greens
  Drive

  
	
   

  	
   

  	
  Bloomington, MN 55437

  

 

Section 6.3  Amendment.  Only a writing signed by both Employer and
Employee may amend this Agreement.

 

Section 6.4  Parties in Interest.  This Agreement is binding upon, and the
benefits and obligations of this Agreement inure to the Parties and their respective
heirs, legal representatives, successors, assigns, transferees or donees.

 

Section 6.6  Entire Agreement.  The Parties intend this Agreement as the
final and binding expression of their agreement and as the complete and
exclusive statement of its terms.  This
Agreement supersedes and revokes all other prior negotiations, representations
and agreements, whether oral or written, regarding the employment relationship
between Employer and Employee.

 

Section 6.7 Enforceability.  If any provision in this Agreement is
declared unenforceable or invalid, that declaration will not impair any other
provision of the Agreement, each of which will be enforced according to their
respective terms.

 

Section 6.8  Construction.  The headings of the paragraphs of this Agreement
are for the purpose of identification only and must not be used for the
construction or interpretation of any portion of this Agreement. Waiver by any
Party of any default, violation or nonperformance under this Agreement will not
be deemed a waiver of that Party’s right to seek legal or equitable relief for
any subsequent violation of the Agreement. As used in this Agreement and where
necessary, the singular includes the plural and vice versa, and masculine,
feminine and neuter expressions are interchangeable.

 

Section 6.9  Applicable Law.  This Agreement was made and entered into in
Minnesota, and the laws of the State of Minnesota govern and apply to this
Agreement and any enforcement, construction or interpretation of this
Agreement.

 

IN WITNESS WHEREOF,
Employer and Employee have knowingly, voluntarily and with the right to seek
independent counsel, executed this Agreement on the date(s) reflected below
with the Effective Date as stated above.

 

9

 

	
  DATE:  July 21, 2004

  	
  DATE:  July 21, 2004

  
	
   

  	
   

  
	
  EMPLOYEE

  	
  SOUTHWEST
  CASINO AND

  HOTEL CORP.

  
	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  	
   

  
	
  Thomas E. Fox

  	
  Jeffrey S. Halpern, Chairman of the Board

  
					

 

10

 

EXHIBIT B

 

NOTICE UNDER

MINNESOTA STATUTES 181.78 (Subd.
3)

 

	
  TO:

  	
   

  	
  Tom Fox

  
	
   

  	
   

  	
   

  
	
  FROM:

  	
   

  	
  Southwest Casino and Hotel Corp. (the “Employer”)

  

 

You have entered into an Employment Agreement with
Employer requiring you, among other things, to assign or offer to assign your
rights in certain inventions to Employer. 
You are hereby notified that the Employment Agreement does not apply to
any invention for which no equipment, supplies, facility or trade secret
information of Employer was used and which was developed entirely on your own
time, and (1) which does not relate (a) directly to the business of Employer,
or (b) to Employer’s actual or demonstrably anticipated research or
development; or (2) which does not result from any work performed by you for
Employer.

 

	
   

  	
  SOUTHWEST CASINO AND HOTEL CORP.

  
	
   

  
	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
  Its

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  I hereby acknowledge receipt of the foregoing
  notice.

  
	
   

  
	
   

  	
   

  
	
   

  	
  Thomas E. Fox

  
				

 

11

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00069-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00069-of-00352.parquet"}]]