Document:

Exhibit 10.2

EXHIBIT 10.2

ADDENDUM

TO AGREEMENT BETWEEN

DOCTORDIRECTORY.COM, INC. AND MIDDLEBROOK PHARMACEUTICALS, INC.

DATED FEBRUARY 3, 2010

THIS ADDENDUM is made and entered into as of March 12, 2010 (this “Addendum”), by and between
MiddleBrook Pharmaceuticals, Inc. (“MBRK”), a Delaware corporation with offices at 7 Village
Circle, Suite 100, Westlake, TX 76262, and DoctorDirectory.com, Inc. (“DD”), a South Carolina
Corporation, with offices at One Page Avenue, Suite 280, Asheville, NC 28801. MBRK and DD may be
referred to collectively as the “Parties” and individually as the “Party”.

WHEREAS, on February 3, 2010, MBRK and DD entered into a Promotion Agreement (the “Agreement”)
pursuant to which DD agreed to provide and MBRK agreed to pay for certain services relating to the
promotion of MOXATAG,

WHEREAS, as contemplated in Section 5.4 of the Agreement, MBRK has requested and DD has agreed to
provide promotional services to those prescribers in territories that are not included in the
current DD Target Segment Prescribers List (as defined in EXHIBIT 1 to the Agreement),

NOW, THEREFORE, the Parties agree to the following:

	 	1.	 	Capitalized terms in this Addendum shall have the terms ascribed in the
Agreement unless otherwise defined herein.

	 
	 	2.	 	DD will promote MOXATAG to New DD Target Segment Prescribers set forth
in EXHIBIT 1 to this Addendum (“Incremental Promotional Services”).

	 
	 	3.	 	DD shall provide Incremental Promotional Services commencing March 22,
2010, (“Incremental Services Commencement Date”) for a period of 24 weeks (the
“Initial Incremental Promotional Services Term”) or for such additional weekly
periods as the Parties shall agree in writing.

	 
	 	4.	 	MBRK shall pay a deposit to DD equal to $60,000 (“Incremental Services
Deposit”) upon the Incremental Services Commencement Date. Thereafter, the Parties
will review the amount of the Incremental Services Deposit every fourteen (14) days
and where necessary, MBRK will make additional deposit payments to DD at an amount
equal to the promotion fees earned by DD for providing Incremental Promotional
Services pursuant to this Addendum (“Incremental Promotion Fees”) in the most
recent, preceding two-week period (“Incremental Promotional Measurement Period”).

	 
	 	5.	 	Every two weeks, DD shall invoice MBRK for the Incremental Promotion
Fees due for the preceding two-week period. Such Incremental Promotion Fees shall
be calculated as follows:

 

 

 

	 	(a)	 	Weeks 1-4, $5.00 per total actual number of MOXATAG
prescriptions filled during the applicable Incremental Promotional
Measurement Period and written by New DD Target Prescribers as stipulated
by the Prescriber Data (“Actual New DD Target Segment MOXATAG TRx”)

	 
	 	(b)	 	Weeks 5-8, $7.50 per Actual New DD Target Segment
MOXATAG TRx

	 
	 	(c)	 	Weeks 9-12, $10.00 per Actual New DD Target Segment
MOXATAG TRx

	 
	 	(d)	 	Weeks 13-24, $12.50 per Actual New DD Target Segment
MOXATAG TRx

	 	6.	 	In the event the Addendum is terminated by MBRK prior to the expiration
of the Initial Incremental Promotional Services Term, MBRK agrees to pay DD those
Incremental Promotion Fees that would have been earned through the end of the
Initial Incremental Promotional Services Term.

	 
	 	7.	 	Except as supplemented by this Addendum, all terms and provisions of
the Agreement remain in full force and effect. This Addendum shall be deemed to be
part of the Agreement and, as supplemented in accordance herewith, the Agreement is
hereby ratified and declared in full force and effect.

IN WITNESS WHEREOF, the Parties hereto, each by a duly authorized representative, have executed
this Addendum as of the date first written above.

	 	 	 	 	 	 	 	 	 
	DoctorDirectory.com, Inc.	 	MiddleBrook Pharmaceuticals, Inc.
	 
	By:
	/s/ Jay Grobowsky
	 	By:	/s/ David Becker
	 
	Name:	 	Jay Grobowsky	 	 	Name:	 	David Becker
	 
	Title:	 	CEO	 	 	Title:	 	Executive Vice President,

Chief Financial Officer
	 
	 	Date:	 	March 12, 2010	 	 	Date:	 	March 12, 2010

 

 

 

EXHIBIT 1

TO ADDENDUM

TO AGREEMENT BETWEEN

DOCTORDIRECTORY.COM, INC. AND MIDDLEBROOK PHARMACEUTICALS, INC.

DATED FEBRUARY 3, 2010

New DD Target Segment Prescribers

The Parties agree that the list of New DD Target Segment Prescribers (hereinafter, the “New DD
Target List”) will be provided to MBRK by DD. MBRK shall have final approval of the New DD Target
List, which shall be documented in writing by the Parties. The New DD Target Segment Prescribers
shall consist of only those licensed prescribers whose clinical practice is consistent with
MOXATAG’s approved labeling, uses, and indication.

The New DD Target List includes, among others, those prescribers that MBRK previously included in
its healthcare practitioner call list and telemarketing program. Any subsequent modifications to
the New DD Target List will be as approved in writing by the Parties.Exhibit 10.1

Exhibit 10.1

PINNACLE ENTERTAINMENT, INC.

NONQUALIFIED STOCK OPTION AGREEMENT

THIS STOCK OPTION AGREEMENT (the “Agreement”) is made and entered into as of March 14, 2010,
by and between Pinnacle Entertainment, Inc., a Delaware corporation (the “Company”), and Anthony M.
Sanfilippo (“Optionee”).

A. The Board of Directors of the Company has determined that it is to the advantage and best
interest of the Company to grant to Optionee a nonqualified stock option outside of the Pinnacle
Entertainment, Inc. 2005 Equity and Performance Incentive Plan, as amended (the “Option”), to
purchase 650,000 shares of the common stock of the Company (the “Common Stock”) in order to more
closely align Optionee’s interests with those of other stockholders of the Company, and has
approved the execution of this Agreement between the Company and Optionee.

B. The Option granted hereby is not intended to qualify as an “incentive stock option” under
Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”).

NOW, THEREFORE, in consideration of the mutual agreements contained herein, Optionee and the
Company hereby agree as follows:

1. Grant and Terms of Stock Option.

1.1 Grant of Option. The Company hereby grants to Optionee the right and option to
purchase, subject to the terms and conditions set forth in this Agreement, all or any part of an
aggregate of 650,000 shares of Common Stock at a purchase price per share equal to $8.64.

1.2 Vesting. This Option shall vest and become exercisable with respect to 20% of the
shares of Common Stock subject to this Option on the first anniversary of the date hereof and, on
each subsequent anniversary of the date hereof, shall vest and become exercisable with respect to
an additional 20% of the shares subject hereto so that this Option shall be vested and exercisable
with respect to 100% of the shares subject hereto on the fifth anniversary of the date hereof.
Upon the termination of Optionee’s “Continuous Status as an Employee, Director or Consultant” (as
defined below) for any reason, the portion of this Option that is not vested and exercisable as of
the date of such termination shall be immediately cancelled and terminated. For purposes of this
Agreement, “Continuous Status as an Employee, Director or Consultant” means that the employment,
director or consulting relationship is not interrupted or terminated by the Company, any parent or
subsidiary, or by Optionee. Continuous Status as an Employee, Director or Consultant will not be
considered interrupted in the case of: (i) any leave of absence approved by the Board, including
sick leave, military leave, or any other personal leave; (ii) transfers between locations of the
Company or between the Company, its parent, its subsidiaries or its successor; or (iii) the ceasing
of Optionee to be an employee while Optionee remains a director or consultant, the ceasing of
Optionee to be a director while Optionee remains an employee or consultant or the ceasing of
Optionee to be a consultant while Optionee remains an employee or director.

1.3 Term of Option. The “Term” of this Option shall begin on the date of this
Agreement and shall expire on March 14, 2020. No portion of this Option may be exercised after the
expiration of the Term.

 

 

 

1.3.1 In the event of the termination of Optionee’s Continuous Status as an Employee,
Director or Consultant for any reason other than by the Company for “Cause” or by Optionee
without “Good Reason” (as such terms are defined in the Employment Agreement dated March
13, 2010 between the Company and Optionee (the “Employment Agreement”)), the portion of
this Option that is vested and exercisable as of the date of termination shall terminate
and be cancelled on the earlier of (i) the expiration of the Term, or (ii) one year after
the termination of Optionee’s Continuous Status as an Employee, Director or Consultant.

1.3.2 In the event of the termination of Optionee’s Continuous Status as an Employee,
Director or Consultant by the Company for Cause or by Optionee without Good Reason, the
portion of this Option that is vested and exercisable as of the date of termination shall
terminate and be cancelled on the earlier of (i) the expiration of the Term, or (ii) 30
days after the termination of Optionee’s Continuous Status as an Employee, Director or
Consultant.

2. Method of Exercise. 

2.1 Delivery of Notice of Exercise. This Option shall be exercisable by written notice
in the form attached hereto as Exhibit A which shall state the election to exercise this Option,
the number of shares of Common Stock in respect of which this Option is being exercised, and such
other representations and agreements with respect to such shares as may be required by the Company
pursuant to the provisions of this Agreement. Such written notice shall be signed by Optionee (or
by Optionee’s beneficiary or other person entitled to exercise this Option in the event of
Optionee’s death pursuant to Section 3 hereof) and shall be delivered in person or by certified
mail to the Secretary of the Company. The written notice shall be accompanied by payment of the
exercise price. This Option shall not be deemed exercised until the Company receives such written
notice accompanied by the exercise price and any other applicable terms and conditions of this
Agreement are satisfied. This Option may not be exercised for a fraction of a share.

2.2 Securities Law Matters; Restrictions on Exercise. Optionee understands that this
Option being granted to him has not been, and will not be, registered under the Securities Act of
1933, as amended (the “Securities Act”), by reason of specific exemptions from the registration
provisions of the Securities Act and applicable state law which depends upon, among other things,
the bona fide nature of the accuracy of Optionee’s representation as expressed herein. Optionee
represents that Optionee is an Accredited Investor within the definition set forth in Rule 501(a)
of the Securities Act. No shares of Common Stock will be issued pursuant to the exercise of this
Option unless and until there shall have been full compliance with all applicable requirements of
the Securities Act (whether by registration or satisfaction of exemption conditions), all
applicable listing requirements of any national securities exchange or other market system on which
the Common Stock is then listed and all applicable requirements of other laws (including, without
limitation, state corporations laws, state securities laws and federal and state tax laws) and of
any regulatory bodies having jurisdiction over such issuance. As a condition to the exercise of
this Option, the Company may require Optionee to make any representation and warranty to the
Company as may be necessary or appropriate, in the judgment of the Board of Directors (or the
Compensation Committee thereof (the “Committee”)), to comply with any applicable laws.

 

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2.3 Method of Payment. Payment of the exercise price shall be made in full
at the time of exercise (a) in cash or by certified check or bank
check or wire transfer of immediately available funds, (b) by delivery
of a properly executed exercise notice together with any other
documentation as the Board of Directors (or the Committee) and the
Optionee’s broker, if applicable, require to effect an exercise of the
Option and delivery to the Company of the sale or other proceeds (as
permitted by applicable law) required to pay the exercise price, or
(c) with the consent of the Board of Directors (or the Committee) in
its discretion, by tendering previously acquired shares of Common
Stock (either actually or by attestation, valued at their then Fair
Market Value) that have been owned for a period of at least six months
(or such other period to avoid accounting charges against the
Company’s earnings). In addition, the Board of Directors (or the
Committee) may impose such other conditions in connection with the
delivery of shares of Common Stock in satisfaction of the exercise
price as it deems appropriate in its sole discretion.

2.4 No Rights as a Stockholder. Until the stock certificate
evidencing shares of Common Stock issued upon exercise of this Option
is issued (as evidenced by the
appropriate entry on the books of the
Company or of a duly authorized
transfer agent of the Company), no
right to vote or receive dividends or
any other rights as a stockholder
will exist with respect to the
 shares, notwithstanding the exercise
of the Option.

3. Non-Transferability of Option.

This Option may not be transferred in any manner otherwise than by will or by the laws of
descent or distribution or to a beneficiary designated by written designation, and may be exercised
during the lifetime of Optionee only by Optionee. Subject to all of the other terms and conditions
of this Agreement, following the death of Optionee, this Option may, to the extent it is vested and
exercisable by Optionee in accordance with its terms on the date of death, be exercised by
Optionee’s beneficiary, estate or other person who acquired the right to exercise this Option by
bequest or inheritance. Notwithstanding the first sentence of this Section 3, this Option may be
assigned, in connection with Optionee’s estate plan, in whole or in part, during Optionee’s
lifetime to one or more family members of Optionee or to a trust established exclusively for one or
more of such family member. Rights under the assigned portion may be exercised by the person or
persons who acquire a proprietary interest in such Option pursuant to the assignment. The terms
applicable to the assigned portion shall be the same as those in effect for the Option immediately
before such assignment and shall be set forth in such documents issued to the assignee as the Board
of Directors (or the Committee) deems appropriate. For purposes of this Section 3, the term
“family member” means any child, stepchild, grandchild, parent, stepparent, grandparent, spouse,
former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother-in-law, or sister-in-law, including adoptive relationships, any person sharing the
Optionee’s household (other than a tenant or employee), a trust in which these persons (or the
Optionee) control the management of assets, and any other entity in which these persons (or the
Optionee) own more than 50 percent of the voting interests.

4. Restrictions; Restrictive Legends.

Ownership and transfer of shares issued pursuant to the exercise of this Option will be
subject to the provisions of, including ownership and transfer restrictions (including, without
limitation, ownership and transfer restrictions imposed by applicable gaming laws) contained in,
the Company’s Certificate of Incorporation, as amended from time to time, restrictions imposed by
applicable laws, stop transfer restrictions, and restrictions set forth or referenced in
legends imprinted on certificates representing such shares.

 

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5. Adjustments Upon Changes in Capitalization, Etc.

5.1 Changes in Capitalization. In the event of any merger, reorganization,
consolidation, recapitalization, dividend or distribution (whether in cash, shares or other
property), stock split, reverse stock split, spin-off or similar transaction or other change in
corporate structure affecting the shares of Common Stock or the value thereof, such adjustments and
other substitutions shall be made to this Option as the Board of Directors (or the Committee), in
its sole discretion, deems equitable or appropriate, including such adjustments in the aggregate
number, class and kind of securities that may be delivered under this Option and in the number,
class, kind and option or exercise price of securities subject to this Option (including, if the
Board of Directors (or the Committee) deems appropriate, the substitution of similar options to
purchase the shares of, or other awards denominated in the shares of, another company) as the Board
of Directors (or the Committee) may determine to be appropriate in its sole discretion; provided,
however, that the number of shares of Common Stock subject to this Option shall always be a whole
number.

5.2 Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, to the extent that this Option had not been previously exercised, it
will terminate immediately prior to the consummation of such proposed dissolution or liquidation.
In such instance, the Company may, in the exercise of its sole discretion, declare that this Option
will terminate as of a date fixed by the Company and give Optionee the right to exercise this
Option as to all or any part of the optioned stock, including shares as to which this Option would
not otherwise be exercisable.

5.3 Corporate Transaction. Upon the happening of a “Change of Control” of the Company
(within the meaning of the Employment Agreement), the Company may, in its sole discretion, do one
or more of the following: (i) shorten the period during which this Option is exercisable (provided
that it remains exercisable for at least 30 days after the date notice of such shortening is given
to Optionee); (ii) accelerate the vesting of this Option; (iii) arrange to have the surviving or
successor entity or any parent entity thereof assume this Option or grant a replacement option in
either case with appropriate adjustments in the option prices and adjustments in the number and
kind of securities issuable upon exercise or adjustments so that this Option or its replacement
represents the right to purchase the shares of stock, securities or other property (including cash)
as may be issuable or payable as a result of such transaction with respect to or in exchange for
the number of shares of Common Stock purchasable and receivable upon exercise of this Option had
such exercise occurred in full prior to such transaction; or (iv) (A) to the extent this Option is
vested (including, if applicable, any acceleration of vesting as contemplated in clause (ii)
above), cancel this Option upon payment to Optionee of an amount that is the equivalent of the
excess of the Fair Market Value of the Common Stock (at the effective time of the change in
control) over the exercise price of this Option, such amount to be payable in cash, in one or more
kinds of stock or property (including the stock or property, if any, payable in the transaction) or
in a combination thereof, as the Board of Directors (or the Committee), in its discretion, shall
determine and (B) to the extent this Option is not vested, either cancel this Option upon a
payment to Optionee in the manner set forth in clause (iv)(A) of this sentence, or arrange for the
assumption of this Option in the manner set forth in clause (iii) of this sentence, in the sole
discretion of the Company.

 

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6. Withholding Taxes.

The Company will have the right to take whatever steps the Board of Directors (or the
Committee) deems necessary or appropriate to comply with all applicable federal, state, local, and
employment tax withholding requirements, and the Company’s obligations to deliver shares of Common
Stock upon the exercise of this Option will be conditioned upon compliance with all such
withholding tax requirements. Without limiting the generality of the foregoing, upon the exercise
of this Option, the Company will have the right to withhold taxes from any other compensation or
other amounts which it may owe to Optionee, or to require Optionee to pay to the Company the amount
of any taxes which the Company may be required to withhold with respect to the shares issued on
such exercise. Without limiting the generality of the foregoing, the Board of Directors (or the
Committee) in its discretion may authorize Optionee to satisfy all or part of any withholding tax
liability by (a) having the Company withhold from the shares of Common Stock which would otherwise
be issued on the exercise of an Option that number of shares having a Fair Market Value, as of the
date the withholding tax liability arises, equal to or less than the amount of the Company’s
withholding tax liability, or (b) by delivering to the Company previously-owned and unencumbered
shares of the Common Stock having a Fair Market Value, as of the date the withholding tax liability
arises, equal to or less than the amount of the Company’s withholding tax liability.

7. General.

7.1 Governing Law. This Agreement shall be governed by and construed under the laws
of the state of Delaware applicable to agreements made and to be performed entirely in Delaware,
without regard to the conflicts of law provisions of Delaware or any other jurisdiction.

7.2 Notices. Any notice required or permitted under this Agreement shall be given in
writing by express courier or by postage prepaid, United States registered or certified mail,
return receipt requested, to the address set forth below or to such other address for a party as
that party may designate by 10 days advance written notice to the other parties. Notice shall be
effective upon the earlier of receipt or 3 days after the mailing of such notice.

	 	 	 	 	 
	 

	 	If to the Company:
	 	Pinnacle Entertainment, Inc.

3800 Howard Hughes Parkway, Suite 1800

Las Vegas, Nevada 89169

Attention: General Counsel
	 
	 	 	 	 
	 

	 	If to Optionee:
	 	Anthony M. Sanfilippo

c/o Butler, Snow, O’Mara, Stevens & Cannada, PLLC

6075 Poplar Avenue, Suite 500

Memphis, Tennessee 38119

Attention: Todd P. Photopulos, Esq.

7.3 Determination of Fair Market Value. “Fair Market Value” means, as of any date,
the value of Common Stock determined as follows:

7.3.1 If the Common Stock is listed on any established stock exchange or a national
market system, including without limitation, the National Market System of NASDAQ, the Fair
Market Value of a share of Common Stock will be the closing sales price for such stock (or
the closing bid, if no sales are reported) as quoted on
that system or exchange (or the system or exchange with the greatest volume of trading
in Common Stock) on the day of determination (if the day of determination is not a market
trading day, then on the last market trading day that is prior to the day of
determination), as reported in the Wall Street Journal or any other source the
Board of Directors (or the Committee) considers reliable.

 

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7.3.2 If the Common Stock is quoted on the NASDAQ System (but not on the NASDAQ
National Market System) or is regularly quoted by recognized securities dealers but selling
prices are not reported, the Fair Market Value of a share of Common Stock will be the mean
between the high bid and low asked prices for the Common Stock on the day of determination
(if the day of determination is not a market trading day, then on the last market trading
day that is prior to the day of determination), as reported in the Wall Street
Journal or any other source the Board of Directors (or the Committee) considers
reliable.

7.3.3 If the Common Stock is not traded as set forth above, the Fair Market Value will
be determined in good faith by the Board of Directors (or the Committee) with reference to
the earnings history, book value and prospects of the Company in light of market conditions
generally, and any other factors the Board of Directors (or the Committee) considers
appropriate, such determination by the Board of Directors (or the Committee) to be final,
conclusive and binding.

7.4 Community Property. Without prejudice to the actual rights of the spouses as
between each other, for all purposes of this Agreement, Optionee shall be treated as agent and
attorney-in-fact for that interest held or claimed by his spouse with respect to this Option and
the parties hereto shall act in all matters as if Optionee was the sole owner of this Option. This
appointment is coupled with an interest and is irrevocable.

7.5 No Employment Rights. Nothing herein contained shall be construed as an agreement
by the Company or any of its subsidiaries, express or implied, to employ Optionee or contract for
Optionee’s services, to restrict the Company’s or such subsidiary’s right to discharge Optionee or
cease contracting for Optionee’s services or to modify, extend or otherwise affect in any manner
whatsoever the terms of any employment agreement or contract for services which may exist between
Optionee and the Company or any of its subsidiaries.

7.6 Modifications. This Agreement may be amended, altered or modified only by a
writing signed by each of the parties hereto.

7.7 Application to Other Stock. In the event any capital stock of the Company or any
other corporation shall be distributed on, with respect to, or in exchange for shares of Common
Stock as a stock dividend, stock split, reclassification or recapitalization in connection with any
merger or reorganization or otherwise, all restrictions, rights and obligations set forth in this
Agreement shall apply with respect to such other capital stock to the same extent as they are, or
would have been applicable, to the shares on or with respect to which such other capital stock was
distributed.

 

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7.8 Additional Documents. Each party agrees to execute any and all further documents
and writings, and to perform such other actions, which may be or become reasonably necessary or
expedient to be made effective and carry out this Agreement.

7.9 No Third-Party Benefits. Except as otherwise expressly provided in this
Agreement, none of the provisions of this Agreement shall be for the benefit of, or enforceable by,
any third-party beneficiary.

7.10 Successors and Assigns. Except as provided herein to the contrary, this
Agreement shall be binding upon and inure to the benefit of the parties, their respective
successors and permitted assigns.

7.11 No Assignment. Except as otherwise provided in this Agreement, Optionee may not
assign any of his rights under this Agreement without the prior written consent of the Company,
which consent may be withheld in its sole discretion. The Company shall be permitted to assign its
rights or obligations under this Agreement, but no such assignment shall release the Company of any
obligations pursuant to this Agreement.

7.12 Severability. The validity, legality or enforceability of the remainder of this
Agreement shall not be affected even if one or more of the provisions of this Agreement shall be
held to be invalid, illegal or unenforceable in any respect.

7.13 Equitable Relief. Optionee acknowledges that, in the event of a threatened or
actual breach of any of the provisions of this Agreement, damages alone will be an inadequate
remedy, and such breach will cause the Company great, immediate and irreparable injury and damage.
Accordingly, Optionee agrees that the Company shall be entitled to injunctive and other equitable
relief, and that such relief shall be in addition to, and not in lieu of, any remedies it may have
at law or under this Agreement.

7.14 Arbitration.

7.14.1 General. Any controversy, dispute, or claim between the parties to this
Agreement, including any claim arising out of, in connection with, or in relation to the formation,
interpretation, performance or breach of this Agreement shall be settled exclusively by
arbitration, before a single arbitrator, in accordance with this Section 7.14 and the then most
applicable rules of the American Arbitration Association. Judgment upon any award rendered by the
arbitrator may be entered by any state or federal court having jurisdiction thereof. Such
arbitration shall be administered by the American Arbitration Association. Arbitration shall be
the exclusive remedy for determining any such dispute, regardless of its nature. Notwithstanding
the foregoing, either party may in an appropriate matter apply to a court for provisional relief,
including a temporary restraining order or a preliminary injunction, on the ground that the award
to which the applicant may be entitled in arbitration may be rendered ineffectual without
provisional relief. Unless mutually agreed by the parties otherwise, any arbitration shall take
place in the City of Las Vegas, Nevada.

 

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7.14.2 Selection of Arbitrator. In the event the parties are unable to agree upon an
arbitrator, the parties shall select a single arbitrator from a list of nine arbitrators drawn by
the parties at random from the “Independent” (or “Gold Card”) list of retired
judges or, at the option of Optionee, from a list of nine persons (which shall be retired
judges or corporate or litigation attorneys experienced in stock options and buy-sell agreements)
provided by the office of the American Arbitration Association having jurisdiction over Las Vegas,
Nevada. If the parties are unable to agree upon an arbitrator from the list so drawn, then the
parties shall each strike names alternately from the list, with the first to strike being
determined by lot. After each party has used four strikes, the remaining name on the list shall be
the arbitrator. If such person is unable to serve for any reason, the parties shall repeat this
process until an arbitrator is selected.

7.14.3 Applicability of Arbitration; Remedial Authority. This agreement to resolve
any disputes by binding arbitration shall extend to claims against any parent, subsidiary or
affiliate of each party, and, when acting within such capacity, any officer, director, stockholder,
employee or agent of each party, or of any of the above, and shall apply as well to claims arising
out of state and federal statutes and local ordinances as well as to claims arising under the
common law. In the event of a dispute subject to this paragraph the parties shall be entitled to
reasonable discovery subject to the discretion of the arbitrator. The remedial authority of the
arbitrator (which shall include the right to grant injunctive or other equitable relief) shall be
the same as, but no greater than, would be the remedial power of a court having jurisdiction over
the parties and their dispute. The arbitrator shall, upon an appropriate motion, dismiss any claim
without an evidentiary hearing if the party bringing the motion establishes that he or it would be
entitled to summary judgement if the matter had been pursued in court litigation. In the event of
a conflict between the applicable rules of the American Arbitration Association and these
procedures, the provisions of these procedures shall govern.

7.14.4 Fees and Costs. Any filing or administrative fees shall be borne initially by
the party requesting arbitration. The Company shall be responsible for the costs and fees of the
arbitration, unless Optionee wishes to contribute (up to 50%) of the costs and fees of the
arbitration. Notwithstanding the foregoing, the prevailing party in such arbitration, as
determined by the arbitrator, and in any enforcement or other court proceedings, shall be entitled,
to the extent permitted by law, to reimbursement from the other party for all of the prevailing
party’s costs (including but not limited to the arbitrator’s compensation), expenses, and
attorneys’ fees.

7.14.5 Award Final and Binding. The arbitrator shall render an award and written
opinion, and the award shall be final and binding upon the parties. If any of the provisions of
this paragraph, or of this Agreement, are determined to be unlawful or otherwise unenforceable, in
whole or in part, such determination shall not affect the validity of the remainder of this
Agreement, and this Agreement shall be reformed to the extent necessary to carry out its provisions
to the greatest extent possible and to insure that the resolution of all conflicts between the
parties, including those arising out of statutory claims, shall be resolved by neutral, binding
arbitration. If a court should find that the arbitration provisions of this Agreement are not
absolutely binding, then the parties intend any arbitration decision and award to be fully
admissible in evidence in any subsequent action, given great weight by any finder of fact, and
treated as determinative to the maximum extent permitted by law.

 

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7.15 Headings. The section headings in this Agreement are inserted only as a matter
of convenience, and in no way define, limit, extend or interpret the scope of this Agreement or of
any particular section.

7.16 Number and Gender. Throughout this Agreement, as the context may require, (a)
the masculine gender includes the feminine and the neuter gender includes the masculine and the
feminine; (b) the singular tense and number includes the plural, and the plural tense and number
includes the singular; (c) the past tense includes the present, and the present tense includes the
past; (d) references to parties, sections, paragraphs and exhibits mean the parties, sections,
paragraphs and exhibits of and to this Agreement; and (e) periods of days, weeks or months mean
calendar days, weeks or months.

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

7.18 Complete Agreement. This Agreement and the Employment Agreement constitute the
total and complete agreement of the parties and supersede all prior and contemporaneous
understandings and agreements heretofore made, and there are no other representations,
understandings or agreements.

7.19 Waiver of Jury Trial. TO THE EXTENT EITHER PARTY INITIATES LITIGATION INVOLVING
THIS AGREEMENT OR ANY ASPECT OF THE RELATIONSHIP BETWEEN US (EVEN IF OTHER PARTIES OR OTHER CLAIMS
ARE INCLUDED IN SUCH LITIGATION), ALL OF THE PARTIES WAIVE THEIR RIGHT TO A TRIAL BY JURY. THIS
WAIVER WILL APPLY TO ALL CAUSES OF ACTION THAT ARE OR MIGHT BE INCLUDED IN SUCH ACTION, INCLUDING
CLAIMS RELATED TO THE ENFORCEMENT OR INTERPRETATION OF THIS AGREEMENT, ALLEGATIONS OF STATE OR
FEDERAL STATUTORY VIOLATIONS, FRAUD, MISREPRESENTATION, OR SIMILAR CAUSES OF ACTION, AND IN
CONNECTION WITH ANY LEGAL ACTION INITIATED FOR THE RECOVERY OF DAMAGES BETWEEN OR AMONG US OR
BETWEEN OR AMONG ANY OF OUR OWNERS, AFFILIATES, OFFICERS, EMPLOYEES OR AGENTS.

[SIGNATURES TO APPEAR ON FOLLOWING PAGE]

 

-9-

 

	 	 	 	 	 
	 	PINNACLE ENTERTAINMENT, INC.

 	 
	 	By:  	/s/ Christopher K. Plant	 
	 	 	Christopher K. Plant, Vice President and 	 
	 	 	Treasurer 	 
	 

	 	 	 	 	 
	 	OPTIONEE

 	 
	 	/s/ Anthony M. Sanfilippo
 	 
	 	Anthony M. Sanfilippo 	 
	 	 	 

 

-10-

 

	 	 	 	 	 

SPOUSAL CONSENT

By her signature below, the spouse of the Optionee agrees to be bound by all of the terms and
conditions of the foregoing Option Agreement (including those relating to the appointment of the
Optionee as agent for any interest that Spouse may have in the shares of Common Stock, which are
subject to the Options).

	 	 	 	 	 
	 	OPTIONEE’S SPOUSE

 	 
	 	
 	 
	 	Signature 	 
	 
	 	 	 
	 	
 	 
	 	Print Name 	 
	 	 	 

 

-11-

 

	 	 	 	 	 

EXHIBIT A

NOTICE OF EXERCISE OF NONQUALIFIED STOCK OPTION

Pinnacle Entertainment, Inc.

3800 Howard Hughes Parkway

Las Vegas, Nevada 89169

Attn: General Counsel

Ladies and Gentlemen:

The undersigned hereby elects to exercise the option indicated below:

Option Grant Date:                                              

Number of Shares as to which Option is Being Exercised:                     

Exercise Price Per Share:                                              

Total Exercise Price: $                         

Method of Payment:                          

Enclosed herewith is payment in full of the total exercise price.

My exact name, current address and social security number for purposes of the stock
certificate to be issued and the stockholder list of the Company are:

Name:
 

Address:
 

 

Social Security Number:
 

	 	 	 	 	 
	 	Sincerely,

 	 
	Dated:___________________	
 	 
	 	(Optionee’s Signature) 	 
	 	 	 
	 

 

-12-

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