1033-00005 · Client 1033 · Engagement

engagement-letter-rgc-cfo-search.docx DOCUMENT Funds

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PRIVILEGED & CONFIDENTIAL

CALDERWOOD & HARKNESS LLP Attorneys at Law

3900 Howard Hughes Parkway, Suite 800 Las Vegas, Nevada 89169 Telephone: (702) 555-3200 Facsimile: (702) 555-3201 www.calderwoodharkness.com

555 South Grand Avenue, Suite 4200 Los Angeles, California 90071

November 8, 2023

Engagement Letter Ref.: 1033-00005 Matter No.: 1033-00005

Priya Narasimhan, Esq. General Counsel Redstone Gaming Corp. 4100 Sandstone Ridge Boulevard Las Vegas, Nevada 89119

Re: Engagement of Calderwood & Harkness LLP — Negotiation and Drafting of Executive Employment Agreement for Chief Financial Officer Candidate (Marcus J. Ellender) Matter No. 1033-00005

Dear Ms. Narasimhan:

We are pleased to confirm that Redstone Gaming Corp. ("RGC" or the "Company") has retained Calderwood & Harkness LLP ("C&H" or the "Firm") to serve as outside counsel in connection with the negotiation, structuring, and drafting of an executive employment agreement for the Company's preferred Chief Financial Officer candidate, Marcus J. Ellender. This engagement arises from the prior discussions between Renata Vasquez of this Firm and you regarding the Company's desire to engage experienced outside employment counsel for this purpose. We appreciate the confidence that the Company has placed in our Firm, and we look forward to working closely with you and your colleagues on this important matter.

The purpose of this letter is to set forth the terms and conditions governing our engagement, including the scope of services to be provided, the identification of the client, the composition of the engagement team, applicable fees and billing arrangements, and other matters relevant to the attorney-client relationship. We understand that RGC is a Delaware corporation, publicly traded on the Nasdaq Stock Market under the ticker symbol "RDGM," with its principal executive offices located in Las Vegas, Nevada. We further understand that the Company has identified Mr. Ellender as its preferred candidate for the CFO position following a comprehensive executive search process, and that the Company wishes to proceed expeditiously with the negotiation and documentation of the employment terms.

We ask that you review the terms of this letter carefully and, if they are acceptable to the Company, execute and return the enclosed duplicate original to confirm the Company's agreement.

1. Purpose and Engagement Overview

This engagement letter memorializes the agreement between Calderwood & Harkness LLP and Redstone Gaming Corp. pursuant to which the Firm will provide legal services to the Company in connection with the negotiation, structuring, and drafting of an executive employment agreement for the Company's preferred Chief Financial Officer candidate, Marcus J. Ellender. As discussed between Renata Vasquez and you during our meetings and telephone conversations in October 2023, the Company has determined that it requires experienced outside employment counsel to advise on the compensation structuring, drafting, negotiation, and corporate governance dimensions of this executive hire. This letter constitutes the formal engagement agreement between the Firm and the Company with respect to this matter and supersedes all prior oral or written communications regarding the scope and terms of the engagement.

2. Scope of Engagement

2.1 Description of Services

The Firm will provide the following legal services to RGC in connection with this engagement:

(a) Compensation Package Structuring. Advising RGC on the structuring of the compensation package for the Chief Financial Officer position, including, without limitation, base salary, annual cash bonus opportunity and related performance metrics, equity incentive awards (including restricted stock units ("RSUs") and performance stock units ("PSUs") under the Company's existing equity incentive plan), signing bonus, relocation allowances, severance protections, and change-in-control provisions. In providing this advice, the Firm will work in coordination with the Company's internal compensation and benefits team and will take into account applicable securities law and tax considerations relevant to the structuring of executive compensation for a Nasdaq-listed company.

(b) Drafting of Executive Employment Agreement. Preparing a comprehensive Executive Employment Agreement between RGC and Marcus J. Ellender reflecting the compensation and employment terms approved by the Company's Compensation Committee and Board of Directors, as applicable. The agreement will address, among other things, the term of employment, duties and reporting structure, compensation and benefits, termination provisions (including termination for cause, termination without cause, resignation for good reason, and resignation without good reason), post-termination obligations, and such other terms as the Company may determine to be appropriate.

(c) Incorporation of Benchmarking Data. Reviewing and incorporating benchmarking data and compensation recommendations provided by RGC's independent compensation consultant, Halcyon Meridian Advisors LLC, under the direction of Anita G. Prescott, Managing Director. The Firm will analyze the consultant's recommendations in light of applicable legal requirements and market practice and will advise the Company on the legal implications of the proposed compensation structure.

(d) Negotiation with Candidate's Counsel. Negotiating the terms of the Executive Employment Agreement on behalf of RGC with Mr. Ellender's personal counsel, Harlan & Mosley LLP, located at 200 West Liberty Street, Suite 1400, Reno, Nevada 89501, with Victoria R. Saldana serving as lead attorney for Mr. Ellender. The Firm will manage all communications and exchanges of drafts with opposing counsel, subject to the Company's direction and approval of all material terms.

(e) Restrictive Covenant Provisions. Advising on the drafting and enforceability of restrictive covenant provisions to be included in the Executive Employment Agreement, including non-competition, non-solicitation of employees, non-solicitation of customers and business relationships, and confidentiality and non-disclosure covenants. In connection with this advice, the Firm will analyze the enforceability of such provisions under Nevada law (including Nevada Revised Statutes § 613.195 and related case law) and will advise on best practices for maximizing the likelihood of enforceability.

(f) Tax Compliance. Advising on compliance considerations arising under Section 280G of the Internal Revenue Code of 1986, as amended (relating to excess parachute payments), and Section 409A of the Internal Revenue Code (relating to deferred compensation), as they pertain to the compensation and severance arrangements contemplated in the Executive Employment Agreement. This advice will include analysis of potential excise tax exposure, consideration of "best net" versus "gross-up" provisions, and compliance with the documentary and operational requirements of Section 409A.

(g) Coordination with Internal Stakeholders. Coordinating with RGC's Chief Human Resources Officer, Dean R. Fulbright, and other internal stakeholders as designated by the Company's General Counsel, on matters relating to compensation and benefits design, internal equity considerations, relocation logistics, and other employment-related issues relevant to the structuring of the CFO employment agreement.

(h) Corporate Governance Matters. Advising on any required Compensation Committee approvals and related corporate governance matters, including the preparation or review of Compensation Committee resolutions, board consents, and any disclosures required under applicable Nasdaq listing rules or SEC regulations in connection with the appointment and compensation of the incoming Chief Financial Officer.

(i) Ancillary Documents. Preparing or reviewing any related ancillary documents as may be necessary or appropriate, including, without limitation, equity award agreements (RSU and PSU agreements under the Company's 2021 Omnibus Equity Incentive Plan), an indemnification agreement for the incoming CFO consistent with the Company's standard form, relocation terms and expense reimbursement arrangements, and any other documents reasonably related to the executive employment transaction.

2.2 Limitations on Scope

The scope of this engagement is limited to the services described in Section 2.1 above. Without limiting the generality of the foregoing, the following matters are expressly excluded from the scope of this engagement:

(a) Litigation and Regulatory Proceedings. This engagement does not include the representation of RGC in any litigation, arbitration, administrative proceeding, or regulatory investigation, whether related or unrelated to the subject matter of this engagement. In the event that any such matter arises, the Company and the Firm would need to enter into a separate engagement agreement.

(b) Tax, Accounting, and Audit Services. This engagement does not cover tax return preparation, accounting services, or audit services of any kind. We understand that RGC's independent auditor is Calloway Firth & Associates LLP. To the extent that accounting or audit-related questions arise in connection with the compensation arrangements being negotiated, the Company should consult directly with its auditors or tax advisors. The Firm's advice regarding Sections 280G and 409A, as described in Section 2.1(f) above, is limited to legal advice and does not constitute tax advice or a tax opinion.

(c) Directors' and Officers' Insurance. This engagement does not cover advice regarding RGC's directors' and officers' liability insurance policy maintained with Pinnacle Investors Indemnity Group, except to the extent that coverage for the incoming Chief Financial Officer must be addressed or referenced in the Executive Employment Agreement or the related indemnification agreement.

(d) Executive Search Process. This engagement does not extend to the executive search process itself or any matters arising from the Company's engagement of its executive search firm. We understand that Kensington Brace Partners has been separately retained by RGC to conduct the executive search and that the search process has been completed. Any questions or issues relating to the Company's relationship with Kensington Brace Partners or the terms of its search engagement are outside the scope of this representation.

If, during the course of this engagement, the Company requests that the Firm provide services beyond the scope described herein, the parties will discuss the expanded scope and, as appropriate, amend this engagement letter or enter into a supplemental engagement agreement.

3. Client Identification

We wish to confirm that the client in this engagement is Redstone Gaming Corp. Our representation extends solely to the Company as an entity, and not to any individual officer, director, employee, stockholder, or affiliate thereof, in his or her individual capacity. This includes, without limitation, the Company's General Counsel, Chief Executive Officer, Chief Human Resources Officer, and members of the Board of Directors and its committees.

We also wish to make clear that Calderwood & Harkness LLP does not represent Marcus J. Ellender in connection with this matter or otherwise. Mr. Ellender is an adverse negotiating counterparty in this transaction, and he is independently represented by his own counsel, Harlan & Mosley LLP. No attorney-client relationship exists, or will be created, between this Firm and Mr. Ellender as a result of this engagement or any communications that may take place during the course of negotiations.

The Firm's communications in connection with this engagement will be directed primarily through Priya Narasimhan, General Counsel, Redstone Gaming Corp., who shall serve as the primary client contact for all purposes under this letter. Ms. Narasimhan may designate from time to time other persons within the Company with whom the Firm is authorized to communicate regarding the subject matter of this engagement, and the Firm will honor any such designations.

4. Engagement Team

The Firm has assembled the following team of attorneys to staff this engagement:

Renata Vasquez — Partner, Labor & Employment Practice Group, Las Vegas office (3900 Howard Hughes Parkway, Suite 800, Las Vegas, NV 89169). Ms. Vasquez will serve as the Responsible Partner for this engagement and will have overall supervisory responsibility for all aspects of the Firm's representation of RGC. She will serve as the primary relationship partner and will be the senior attorney with whom the Company's General Counsel communicates on strategic and substantive matters. Ms. Vasquez has extensive experience representing public and private companies in executive compensation and employment matters, including in the gaming and hospitality sectors.

Bernard Crawford — Partner, Labor & Employment Practice Group, Las Vegas office. Mr. Crawford will serve as the Billing Partner for this engagement and will be responsible for the administration of billing and invoicing in accordance with the terms set forth in this letter. Mr. Crawford will also be available for consultation on substantive matters as needed, including matters relating to restrictive covenant enforceability and Section 409A compliance.

Nadia Petrov — Senior Associate, Labor & Employment Practice Group, Las Vegas office. Ms. Petrov will be responsible for the day-to-day management of the engagement, including the initial preparation and subsequent revision of all transaction documents, redlining and markup of agreement drafts, and direct negotiation with opposing counsel (Harlan & Mosley LLP) under the supervision of Ms. Vasquez. Ms. Petrov will serve as the primary point of contact for routine communications and scheduling matters.

James Underwood — Associate, Labor & Employment Practice Group, Los Angeles office (555 South Grand Avenue, Suite 4200, Los Angeles, CA 90071). Mr. Underwood will assist the engagement team with legal research, drafting, and other matters as directed by Ms. Vasquez and Ms. Petrov. Mr. Underwood's involvement will be focused on research memoranda relating to Nevada restrictive covenant law, Section 280G analysis, and benchmarking of market terms for comparable executive employment agreements in the gaming industry.

The Firm reserves the right to assign other attorneys, paralegals, or staff to work on this engagement as needed in order to provide efficient and effective service to the Company. In the event that additional timekeepers are assigned to the matter, the Firm will provide notice to the Company of such assignment, together with the applicable billing rate for each such timekeeper.

5. Fees and Billing Rates

5.1 Fee Structure

Services rendered in connection with this engagement will be billed at the Firm's standard hourly rates for the timekeepers assigned to the matter. The current hourly rates for the members of the engagement team are as follows:

In the event that additional attorneys or paraprofessionals are assigned to this engagement, their applicable hourly rates will be communicated to the Company at the time of assignment. Current hourly rates for paralegals in the Firm's Labor & Employment Practice Group generally range from $350.00 to $425.00 per hour, depending on experience and seniority.

The Firm's standard hourly rates are subject to periodic adjustment, which typically occurs on January 1 of each year. The Firm will provide advance written notice to the Company of any rate adjustment. Unless the Company objects in writing within fifteen (15) days of receiving such notice, the adjusted rates will apply to services rendered on and after the effective date of the adjustment.

5.2 Estimated Fee Budget

Based on the anticipated scope of services described in Section 2.1 above, and taking into account the Firm's experience with comparable engagements involving the negotiation of executive employment agreements for public company CFO positions, the Firm estimates that total legal fees for this engagement will be in the range of $75,000 to $100,000. This estimate is based on a number of assumptions, including that the negotiation process will involve a customary number of draft exchanges and negotiation sessions, that no unusual legal issues will arise during the engagement, and that the engagement will be completed within approximately sixty (60) to ninety (90) days of commencement.

This estimate is provided for budgeting and planning purposes only and does not constitute a cap, ceiling, or fixed fee arrangement. Actual fees may be higher or lower than the estimated range depending on range factors, including the complexity and duration of negotiations with Mr. Ellender's counsel, the number and nature of issues raised by either party during the negotiation process, the extent of revisions requested by the Company's Compensation Committee or Board of Directors, and other unforeseen circumstances. The Firm will endeavor to keep the Company informed of the progress of the engagement and the status of fees incurred. In the event that it appears that fees are likely to exceed the upper end of the estimated range, the Firm will promptly notify the Company's General Counsel and discuss the reasons for the variance and any steps that may be taken to manage costs going forward.

5.3 Expenses. In addition to professional fees, RGC will be responsible for the reimbursement of reasonable out-of-pocket expenses incurred by the Firm in connection with this engagement. Such expenses may include, without limitation:

• Legal research database charges (e.g., Westmark Data Systems, Sundial Solutions);

• Courier, express delivery, and overnight shipping charges;

• Photocopying and document reproduction charges;

• Long-distance telephone and conference call charges;

• Travel expenses, including airfare, ground transportation, lodging, and meals, if travel is required in connection with the engagement (e.g., for in-person meetings with the Company's Compensation Committee or Board of Directors);

• Filing fees or recording charges, if applicable; and

• Other out-of-pocket costs reasonably incurred in the performance of services under this engagement.

All expenses will be itemized on the Firm's invoices. The Firm will seek advance approval from the Company before incurring any single expense in excess of $1,000.00 or before undertaking any travel in connection with the engagement.

6. Billing and Payment Terms

Invoices for professional fees and expenses will be rendered monthly, on or about the fifteenth (15th) day of the month following the month in which services were rendered and expenses were incurred, or at such other intervals as may be mutually agreed upon by the parties. Each invoice will include a summary description of the services rendered during the applicable billing period, identification of the timekeepers who performed services, the number of hours expended by each timekeeper, and an itemization of all reimbursable expenses.

Payment of invoices is due within thirty (30) days of the date of the invoice. If the Company has a question or dispute regarding any item on an invoice, the Company should notify the Billing Partner, Bernard Crawford, promptly upon receipt of the invoice so that the matter may be addressed in a timely manner. Any undisputed portion of an invoice should be paid in accordance with the standard payment terms notwithstanding any pending inquiry regarding a disputed item.

The client contact for billing inquiries is Priya Narasimhan, General Counsel, Redstone Gaming Corp., 4100 Sandstone Ridge Boulevard, Las Vegas, NV 89119. The Billing Partner at the Firm is Bernard Crawford, who may be reached at the Firm's Las Vegas office.

7. Confidentiality and Privilege

All communications between Calderwood & Harkness LLP and Redstone Gaming Corp. in connection with this engagement are intended to be protected by the attorney-client privilege and/or the work product doctrine to the fullest extent permitted by applicable law. The Firm will take reasonable steps to preserve the privileged and confidential nature of such communications, and we ask that the Company do the same by limiting the internal distribution of privileged communications to those individuals within the Company who have a need to know and by marking such communications as "Privileged and Confidential — Attorney-Client Communication" where appropriate.

The Firm will maintain the confidentiality of all information received from RGC in connection with this engagement, including proprietary business information, financial data, compensation information, board and committee deliberations, and strategic plans, in accordance with the Firm's professional and ethical obligations. Such information will not be disclosed to any third party without the Company's prior consent, except as may be required by applicable law, regulation, or court order, or as may be necessary in connection with the Firm's compliance with its own ethical and professional obligations.

With respect to the CFO candidate, Marcus J. Ellender: information shared by or about Mr. Ellender during the course of negotiations will be treated as confidential to the extent consistent with the Firm's obligations to its client, RGC. However, as noted in Section 3 above, Mr. Ellender is not a client of the Firm, and no attorney-client privilege or similar duty of confidentiality runs between the Firm and Mr. Ellender. Information regarding Mr. Ellender's current compensation, personal circumstances, or negotiating positions that is provided to the Firm by the Company or obtained through the negotiation process may be shared with authorized representatives of RGC in furtherance of the Firm's representation of the Company.

8. Conflicts of Interest

The Firm has conducted a conflict of interest check in accordance with its standard procedures and the requirements of the Nevada Rules of Professional Conduct. Based on that review, the Firm confirms that, as of the date of this letter, it is not aware of any conflict of interest that would preclude the Firm from representing Redstone Gaming Corp. in this matter.

Specifically, the Firm does not currently represent, and has not within the past twenty-four (24) months represented, any of the following persons or entities in any matter adverse to RGC or in any matter substantially related to the subject matter of this engagement:

• Marcus J. Ellender;

• Grandview Resorts International, Inc. (Mr. Ellender's current employer, as we understand);

• Pinnacle Crest Entertainment, Inc.;

• Harlan & Mosley LLP (Mr. Ellender's personal counsel);

• Kensington Brace Partners (the Company's executive search firm); or

• Any other party whose interests are adverse to RGC's interests in connection with this matter.

The Firm represents a wide range of clients across numerous industries and practice areas, including other companies in the gaming and hospitality sectors. Consistent with the Nevada Rules of Professional Conduct and the Firm's own conflicts policies, the Firm may, during the pendency of this engagement, represent other clients in matters unrelated to this engagement, even if such clients are competitors of RGC, provided that such representation does not involve a conflict of interest with respect to this engagement.

If a conflict of interest arises during the course of this engagement, the Firm will promptly notify the Company and the parties will work in good faith to resolve the conflict, including through the implementation of appropriate ethical screens or other measures. If the conflict cannot be resolved to the mutual satisfaction of the parties in a manner consistent with the applicable rules of professional conduct, the Firm may be required to withdraw from this engagement. In such event, the provisions of Section 10 below regarding termination shall apply.

9. Governing Law

This engagement letter and the relationship between Calderwood & Harkness LLP and Redstone Gaming Corp. shall be governed by and construed in accordance with the laws of the State of Nevada, without regard to principles of conflict of laws that would result in the application of the laws of any other jurisdiction. To the extent not governed by state law, this engagement letter shall also be subject to the Nevada Rules of Professional Conduct and any other applicable rules governing the practice of law in the State of Nevada.

Any disputes arising from or related to this engagement, including disputes regarding fees, the scope of services, or any other matter arising under this letter, shall be subject to the exclusive jurisdiction of the state and federal courts located in Clark County, Nevada. Each party hereby consents to the personal jurisdiction of such courts and waives any objection based on improper venue or inconvenient forum.

10. Term and Termination

This engagement shall commence as of the date of execution of this letter by both parties and shall continue until the earliest to occur of the following:

(a) the completion of the services described in Section 2.1 above, including the execution of the Executive Employment Agreement and any related ancillary documents by the Company and Mr. Ellender;

(b) the termination of the engagement by either party upon written notice to the other party, which notice may be given at any time and for any reason or no reason; or

(c) the occurrence of an event that makes continued representation impracticable or impermissible under the Nevada Rules of Professional Conduct or other applicable rules governing the practice of law, including, without limitation, the discovery of a disqualifying conflict of interest that cannot be resolved through consent or other appropriate measures.

Upon termination of this engagement for any reason, the Company will remain responsible for the payment of all professional fees earned and expenses incurred by the Firm through the date of termination, in accordance with the fee and billing terms set forth in Sections 5 and 6 above. The Firm will issue a final invoice within thirty (30) days of the effective date of termination.

In the event of termination, the Firm will cooperate fully with the Company in the orderly transition of the matter to successor counsel designated by the Company, including by making available to successor counsel all relevant files, documents, and work product prepared by the Firm in connection with this engagement, subject to the Firm's lien rights (if any) and the payment of all outstanding fees and expenses.

11. Document Retention

Following the conclusion of this engagement, the Firm will retain the engagement file (including correspondence, memoranda, drafts, and other work product) in accordance with the Firm's standard document retention policies, which currently provide for the retention of closed matter files for a period of seven (7) years following the date of file closure, unless a longer retention period is required by applicable law or regulation. At the conclusion of the retention period, the Firm may destroy the file and its contents without further notice to the Company.

Original documents and materials provided by the Company to the Firm during the course of this engagement will be returned to RGC upon the Company's written request, either during or after the engagement. The Company may request copies of the engagement file at any time during the retention period, and the Firm will provide such copies at the Company's expense.

12. No Guarantee of Outcome

While the Firm will devote its best professional efforts to the representation of Redstone Gaming Corp. in this matter, the Firm's agreement to undertake this engagement does not constitute, and should not be construed as, a guarantee or assurance of any particular outcome. The successful negotiation and execution of an executive employment agreement with Mr. Ellender will depend upon a number of factors outside the Firm's control, including the willingness of Mr. Ellender and his counsel to agree to the terms proposed by the Company, the approval of the Compensation Committee and Board of Directors, and other circumstances that may arise during the course of negotiations. The Firm will keep the Company informed of material developments and will provide its candid assessment of the progress and prospects of the negotiation at all times.

13. Acceptance and Execution

We respectfully request that you, on behalf of Redstone Gaming Corp., execute the enclosed duplicate original of this engagement letter in the space provided below and return it to the Firm at your earliest convenience to confirm the Company's agreement to the terms set forth herein. An executed copy may be returned by hand delivery, overnight courier, or email (PDF) to Renata Vasquez at the address or email set forth below. The original executed copy should follow by mail or courier.

We are enthusiastic about the opportunity to work with Redstone Gaming Corp. on this important matter and are confident that we can bring significant value to the process of structuring and negotiating an executive employment agreement that serves the Company's interests. Please do not hesitate to contact Renata Vasquez or Nadia Petrov if you have any questions regarding the terms of this letter or if you wish to discuss any aspect of the engagement before signing.

We look forward to getting started.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Name: Renata Vasquez

Title: Partner, Labor & Employment Practice Group

Responsible Partner

3900 Howard Hughes Parkway, Suite 800 Las Vegas, Nevada 89169 Telephone: (702) 555-3217

Email: rvasquez@calderwoodharkness.com

ACKNOWLEDGMENT AND ACCEPTANCE

The undersigned, on behalf of Redstone Gaming Corp., hereby acknowledges receipt of the foregoing Engagement Letter dated November 8, 2023 (Reference: 1033-00005; Matter No. 1033-00005) and agrees, on behalf of the Company, to the terms and conditions set forth therein.

ACKNOWLEDGED AND AGREED:

REDSTONE GAMING CORP.

By: ________

Name: Priya Narasimhan

Title: General Counsel

Date: ________

4100 Sandstone Ridge Boulevard Las Vegas, Nevada 89119

cc: Gavin T. Ashford, Chief Executive Officer, Redstone Gaming Corp. cc: Dean R. Fulbright, Chief Human Resources Officer, Redstone Gaming Corp. cc: Bernard Crawford, Billing Partner, Calderwood & Harkness LLP

Enclosure: Duplicate original of this Engagement Letter for execution and return

Timekeeper	Position	Hourly Rate
Renata Vasquez	Partner	$1,150.00
Bernard Crawford	Partner	$1,100.00
Nadia Petrov	Senior Associate	$785.00
James Underwood	Associate	$625.00

PRIVILEGED & CONFIDENTIAL
CALDERWOOD & HARKNESS LLP Attorneys at Law
3900 Howard Hughes Parkway, Suite 800 Las Vegas, Nevada 89169 Telephone: (702) 555-3200 Facsimile: (702) 555-3201 www.calderwoodharkness.com
555 South Grand Avenue, Suite 4200 Los Angeles, California 90071
November 8, 2023
Engagement Letter Ref.: 1033-00005 Matter No.: 1033-00005
Priya Narasimhan, Esq. General Counsel Redstone Gaming Corp. 4100 Sandstone Ridge Boulevard Las Vegas, Nevada 89119
Re: Engagement of Calderwood & Harkness LLP — Negotiation and Drafting of Executive Employment Agreement for Chief Financial Officer Candidate (Marcus J. Ellender) Matter No. 1033-00005
Dear Ms. Narasimhan:
We are pleased to confirm that Redstone Gaming Corp. ("RGC" or the "Company") has retained Calderwood & Harkness LLP ("C&H" or the "Firm") to serve as outside counsel in connection with the negotiation, structuring, and drafting of an executive employment agreement for the Company's preferred Chief Financial Officer candidate, Marcus J. Ellender. This engagement arises from the prior discussions between Renata Vasquez of this Firm and you regarding the Company's desire to engage experienced outside employment counsel for this purpose. We appreciate the confidence that the Company has placed in our Firm, and we look forward to working closely with you and your colleagues on this important matter.
The purpose of this letter is to set forth the terms and conditions governing our engagement, including the scope of services to be provided, the identification of the client, the composition of the engagement team, applicable fees and billing arrangements, and other matters relevant to the attorney-client relationship. We understand that RGC is a Delaware corporation, publicly traded on the Nasdaq Stock Market under the ticker symbol "RDGM," with its principal executive offices located in Las Vegas, Nevada. We further understand that the Company has identified Mr. Ellender as its preferred candidate for the CFO position following a comprehensive executive search process, and that the Company wishes to proceed expeditiously with the negotiation and documentation of the employment terms.
We ask that you review the terms of this letter carefully and, if they are acceptable to the Company, execute and return the enclosed duplicate original to confirm the Company's agreement.
1. Purpose and Engagement Overview
This engagement letter memorializes the agreement between Calderwood & Harkness LLP and Redstone Gaming Corp. pursuant to which the Firm will provide legal services to the Company in connection with the negotiation, structuring, and drafting of an executive employment agreement for the Company's preferred Chief Financial Officer candidate, Marcus J. Ellender. As discussed between Renata Vasquez and you during our meetings and telephone conversations in October 2023, the Company has determined that it requires experienced outside employment counsel to advise on the compensation structuring, drafting, negotiation, and corporate governance dimensions of this executive hire. This letter constitutes the formal engagement agreement between the Firm and the Company with respect to this matter and supersedes all prior oral or written communications regarding the scope and terms of the engagement.
2. Scope of Engagement
2.1 Description of Services
The Firm will provide the following legal services to RGC in connection with this engagement:
(a) Compensation Package Structuring. Advising RGC on the structuring of the compensation package for the Chief Financial Officer position, including, without limitation, base salary, annual cash bonus opportunity and related performance metrics, equity incentive awards (including restricted stock units ("RSUs") and performance stock units ("PSUs") under the Company's existing equity incentive plan), signing bonus, relocation allowances, severance protections, and change-in-control provisions. In providing this advice, the Firm will work in coordination with the Company's internal compensation and benefits team and will take into account applicable securities law and tax considerations relevant to the structuring of executive compensation for a Nasdaq-listed company.
(b) Drafting of Executive Employment Agreement. Preparing a comprehensive Executive Employment Agreement between RGC and Marcus J. Ellender reflecting the compensation and employment terms approved by the Company's Compensation Committee and Board of Directors, as applicable. The agreement will address, among other things, the term of employment, duties and reporting structure, compensation and benefits, termination provisions (including termination for cause, termination without cause, resignation for good reason, and resignation without good reason), post-termination obligations, and such other terms as the Company may determine to be appropriate.
(c) Incorporation of Benchmarking Data. Reviewing and incorporating benchmarking data and compensation recommendations provided by RGC's independent compensation consultant, Halcyon Meridian Advisors LLC, under the direction of Anita G. Prescott, Managing Director. The Firm will analyze the consultant's recommendations in light of applicable legal requirements and market practice and will advise the Company on the legal implications of the proposed compensation structure.
(d) Negotiation with Candidate's Counsel. Negotiating the terms of the Executive Employment Agreement on behalf of RGC with Mr. Ellender's personal counsel, Harlan & Mosley LLP, located at 200 West Liberty Street, Suite 1400, Reno, Nevada 89501, with Victoria R. Saldana serving as lead attorney for Mr. Ellender. The Firm will manage all communications and exchanges of drafts with opposing counsel, subject to the Company's direction and approval of all material terms.
(e) Restrictive Covenant Provisions. Advising on the drafting and enforceability of restrictive covenant provisions to be included in the Executive Employment Agreement, including non-competition, non-solicitation of employees, non-solicitation of customers and business relationships, and confidentiality and non-disclosure covenants. In connection with this advice, the Firm will analyze the enforceability of such provisions under Nevada law (including Nevada Revised Statutes § 613.195 and related case law) and will advise on best practices for maximizing the likelihood of enforceability.
(f) Tax Compliance. Advising on compliance considerations arising under Section 280G of the Internal Revenue Code of 1986, as amended (relating to excess parachute payments), and Section 409A of the Internal Revenue Code (relating to deferred compensation), as they pertain to the compensation and severance arrangements contemplated in the Executive Employment Agreement. This advice will include analysis of potential excise tax exposure, consideration of "best net" versus "gross-up" provisions, and compliance with the documentary and operational requirements of Section 409A.
(g) Coordination with Internal Stakeholders. Coordinating with RGC's Chief Human Resources Officer, Dean R. Fulbright, and other internal stakeholders as designated by the Company's General Counsel, on matters relating to compensation and benefits design, internal equity considerations, relocation logistics, and other employment-related issues relevant to the structuring of the CFO employment agreement.
(h) Corporate Governance Matters. Advising on any required Compensation Committee approvals and related corporate governance matters, including the preparation or review of Compensation Committee resolutions, board consents, and any disclosures required under applicable Nasdaq listing rules or SEC regulations in connection with the appointment and compensation of the incoming Chief Financial Officer.
(i) Ancillary Documents. Preparing or reviewing any related ancillary documents as may be necessary or appropriate, including, without limitation, equity award agreements (RSU and PSU agreements under the Company's 2021 Omnibus Equity Incentive Plan), an indemnification agreement for the incoming CFO consistent with the Company's standard form, relocation terms and expense reimbursement arrangements, and any other documents reasonably related to the executive employment transaction.
2.2 Limitations on Scope
The scope of this engagement is limited to the services described in Section 2.1 above. Without limiting the generality of the foregoing, the following matters are expressly excluded from the scope of this engagement:
(a) Litigation and Regulatory Proceedings. This engagement does not include the representation of RGC in any litigation, arbitration, administrative proceeding, or regulatory investigation, whether related or unrelated to the subject matter of this engagement. In the event that any such matter arises, the Company and the Firm would need to enter into a separate engagement agreement.
(b) Tax, Accounting, and Audit Services. This engagement does not cover tax return preparation, accounting services, or audit services of any kind. We understand that RGC's independent auditor is Calloway Firth & Associates LLP. To the extent that accounting or audit-related questions arise in connection with the compensation arrangements being negotiated, the Company should consult directly with its auditors or tax advisors. The Firm's advice regarding Sections 280G and 409A, as described in Section 2.1(f) above, is limited to legal advice and does not constitute tax advice or a tax opinion.
(c) Directors' and Officers' Insurance. This engagement does not cover advice regarding RGC's directors' and officers' liability insurance policy maintained with Pinnacle Investors Indemnity Group, except to the extent that coverage for the incoming Chief Financial Officer must be addressed or referenced in the Executive Employment Agreement or the related indemnification agreement.
(d) Executive Search Process. This engagement does not extend to the executive search process itself or any matters arising from the Company's engagement of its executive search firm. We understand that Kensington Brace Partners has been separately retained by RGC to conduct the executive search and that the search process has been completed. Any questions or issues relating to the Company's relationship with Kensington Brace Partners or the terms of its search engagement are outside the scope of this representation.
If, during the course of this engagement, the Company requests that the Firm provide services beyond the scope described herein, the parties will discuss the expanded scope and, as appropriate, amend this engagement letter or enter into a supplemental engagement agreement.
3. Client Identification
We wish to confirm that the client in this engagement is Redstone Gaming Corp. Our representation extends solely to the Company as an entity, and not to any individual officer, director, employee, stockholder, or affiliate thereof, in his or her individual capacity. This includes, without limitation, the Company's General Counsel, Chief Executive Officer, Chief Human Resources Officer, and members of the Board of Directors and its committees.
We also wish to make clear that Calderwood & Harkness LLP does not represent Marcus J. Ellender in connection with this matter or otherwise. Mr. Ellender is an adverse negotiating counterparty in this transaction, and he is independently represented by his own counsel, Harlan & Mosley LLP. No attorney-client relationship exists, or will be created, between this Firm and Mr. Ellender as a result of this engagement or any communications that may take place during the course of negotiations.
The Firm's communications in connection with this engagement will be directed primarily through Priya Narasimhan, General Counsel, Redstone Gaming Corp., who shall serve as the primary client contact for all purposes under this letter. Ms. Narasimhan may designate from time to time other persons within the Company with whom the Firm is authorized to communicate regarding the subject matter of this engagement, and the Firm will honor any such designations.
4. Engagement Team
The Firm has assembled the following team of attorneys to staff this engagement:
Renata Vasquez — Partner, Labor & Employment Practice Group, Las Vegas office (3900 Howard Hughes Parkway, Suite 800, Las Vegas, NV 89169). Ms. Vasquez will serve as the Responsible Partner for this engagement and will have overall supervisory responsibility for all aspects of the Firm's representation of RGC. She will serve as the primary relationship partner and will be the senior attorney with whom the Company's General Counsel communicates on strategic and substantive matters. Ms. Vasquez has extensive experience representing public and private companies in executive compensation and employment matters, including in the gaming and hospitality sectors.
Bernard Crawford — Partner, Labor & Employment Practice Group, Las Vegas office. Mr. Crawford will serve as the Billing Partner for this engagement and will be responsible for the administration of billing and invoicing in accordance with the terms set forth in this letter. Mr. Crawford will also be available for consultation on substantive matters as needed, including matters relating to restrictive covenant enforceability and Section 409A compliance.
Nadia Petrov — Senior Associate, Labor & Employment Practice Group, Las Vegas office. Ms. Petrov will be responsible for the day-to-day management of the engagement, including the initial preparation and subsequent revision of all transaction documents, redlining and markup of agreement drafts, and direct negotiation with opposing counsel (Harlan & Mosley LLP) under the supervision of Ms. Vasquez. Ms. Petrov will serve as the primary point of contact for routine communications and scheduling matters.
James Underwood — Associate, Labor & Employment Practice Group, Los Angeles office (555 South Grand Avenue, Suite 4200, Los Angeles, CA 90071). Mr. Underwood will assist the engagement team with legal research, drafting, and other matters as directed by Ms. Vasquez and Ms. Petrov. Mr. Underwood's involvement will be focused on research memoranda relating to Nevada restrictive covenant law, Section 280G analysis, and benchmarking of market terms for comparable executive employment agreements in the gaming industry.
The Firm reserves the right to assign other attorneys, paralegals, or staff to work on this engagement as needed in order to provide efficient and effective service to the Company. In the event that additional timekeepers are assigned to the matter, the Firm will provide notice to the Company of such assignment, together with the applicable billing rate for each such timekeeper.
5. Fees and Billing Rates
5.1 Fee Structure
Services rendered in connection with this engagement will be billed at the Firm's standard hourly rates for the timekeepers assigned to the matter. The current hourly rates for the members of the engagement team are as follows:
In the event that additional attorneys or paraprofessionals are assigned to this engagement, their applicable hourly rates will be communicated to the Company at the time of assignment. Current hourly rates for paralegals in the Firm's Labor & Employment Practice Group generally range from $350.00 to $425.00 per hour, depending on experience and seniority.
The Firm's standard hourly rates are subject to periodic adjustment, which typically occurs on January 1 of each year. The Firm will provide advance written notice to the Company of any rate adjustment. Unless the Company objects in writing within fifteen (15) days of receiving such notice, the adjusted rates will apply to services rendered on and after the effective date of the adjustment.
5.2 Estimated Fee Budget
Based on the anticipated scope of services described in Section 2.1 above, and taking into account the Firm's experience with comparable engagements involving the negotiation of executive employment agreements for public company CFO positions, the Firm estimates that total legal fees for this engagement will be in the range of $75,000 to $100,000. This estimate is based on a number of assumptions, including that the negotiation process will involve a customary number of draft exchanges and negotiation sessions, that no unusual legal issues will arise during the engagement, and that the engagement will be completed within approximately sixty (60) to ninety (90) days of commencement.
This estimate is provided for budgeting and planning purposes only and does not constitute a cap, ceiling, or fixed fee arrangement. Actual fees may be higher or lower than the estimated range depending on range factors, including the complexity and duration of negotiations with Mr. Ellender's counsel, the number and nature of issues raised by either party during the negotiation process, the extent of revisions requested by the Company's Compensation Committee or Board of Directors, and other unforeseen circumstances. The Firm will endeavor to keep the Company informed of the progress of the engagement and the status of fees incurred. In the event that it appears that fees are likely to exceed the upper end of the estimated range, the Firm will promptly notify the Company's General Counsel and discuss the reasons for the variance and any steps that may be taken to manage costs going forward.
5.3 Expenses.  In addition to professional fees, RGC will be responsible for the reimbursement of reasonable out-of-pocket expenses incurred by the Firm in connection with this engagement. Such expenses may include, without limitation:
•  Legal research database charges (e.g., Westmark Data Systems, Sundial Solutions);
•  Courier, express delivery, and overnight shipping charges;
•  Photocopying and document reproduction charges;
•  Long-distance telephone and conference call charges;
•  Travel expenses, including airfare, ground transportation, lodging, and meals, if travel is required in connection with the engagement (e.g., for in-person meetings with the Company's Compensation Committee or Board of Directors);
•  Filing fees or recording charges, if applicable; and
•  Other out-of-pocket costs reasonably incurred in the performance of services under this engagement.
All expenses will be itemized on the Firm's invoices. The Firm will seek advance approval from the Company before incurring any single expense in excess of $1,000.00 or before undertaking any travel in connection with the engagement.
6. Billing and Payment Terms
Invoices for professional fees and expenses will be rendered monthly, on or about the fifteenth (15th) day of the month following the month in which services were rendered and expenses were incurred, or at such other intervals as may be mutually agreed upon by the parties. Each invoice will include a summary description of the services rendered during the applicable billing period, identification of the timekeepers who performed services, the number of hours expended by each timekeeper, and an itemization of all reimbursable expenses.
Payment of invoices is due within thirty (30) days of the date of the invoice. If the Company has a question or dispute regarding any item on an invoice, the Company should notify the Billing Partner, Bernard Crawford, promptly upon receipt of the invoice so that the matter may be addressed in a timely manner. Any undisputed portion of an invoice should be paid in accordance with the standard payment terms notwithstanding any pending inquiry regarding a disputed item.
The client contact for billing inquiries is Priya Narasimhan, General Counsel, Redstone Gaming Corp., 4100 Sandstone Ridge Boulevard, Las Vegas, NV 89119. The Billing Partner at the Firm is Bernard Crawford, who may be reached at the Firm's Las Vegas office.
7. Confidentiality and Privilege
All communications between Calderwood & Harkness LLP and Redstone Gaming Corp. in connection with this engagement are intended to be protected by the attorney-client privilege and/or the work product doctrine to the fullest extent permitted by applicable law. The Firm will take reasonable steps to preserve the privileged and confidential nature of such communications, and we ask that the Company do the same by limiting the internal distribution of privileged communications to those individuals within the Company who have a need to know and by marking such communications as "Privileged and Confidential — Attorney-Client Communication" where appropriate.
The Firm will maintain the confidentiality of all information received from RGC in connection with this engagement, including proprietary business information, financial data, compensation information, board and committee deliberations, and strategic plans, in accordance with the Firm's professional and ethical obligations. Such information will not be disclosed to any third party without the Company's prior consent, except as may be required by applicable law, regulation, or court order, or as may be necessary in connection with the Firm's compliance with its own ethical and professional obligations.
With respect to the CFO candidate, Marcus J. Ellender: information shared by or about Mr. Ellender during the course of negotiations will be treated as confidential to the extent consistent with the Firm's obligations to its client, RGC. However, as noted in Section 3 above, Mr. Ellender is not a client of the Firm, and no attorney-client privilege or similar duty of confidentiality runs between the Firm and Mr. Ellender. Information regarding Mr. Ellender's current compensation, personal circumstances, or negotiating positions that is provided to the Firm by the Company or obtained through the negotiation process may be shared with authorized representatives of RGC in furtherance of the Firm's representation of the Company.
8. Conflicts of Interest
The Firm has conducted a conflict of interest check in accordance with its standard procedures and the requirements of the Nevada Rules of Professional Conduct. Based on that review, the Firm confirms that, as of the date of this letter, it is not aware of any conflict of interest that would preclude the Firm from representing Redstone Gaming Corp. in this matter.
Specifically, the Firm does not currently represent, and has not within the past twenty-four (24) months represented, any of the following persons or entities in any matter adverse to RGC or in any matter substantially related to the subject matter of this engagement:
•  Marcus J. Ellender;
•  Grandview Resorts International, Inc. (Mr. Ellender's current employer, as we understand);
•  Pinnacle Crest Entertainment, Inc.;
•  Harlan & Mosley LLP (Mr. Ellender's personal counsel);
•  Kensington Brace Partners (the Company's executive search firm); or
•  Any other party whose interests are adverse to RGC's interests in connection with this matter.
The Firm represents a wide range of clients across numerous industries and practice areas, including other companies in the gaming and hospitality sectors. Consistent with the Nevada Rules of Professional Conduct and the Firm's own conflicts policies, the Firm may, during the pendency of this engagement, represent other clients in matters unrelated to this engagement, even if such clients are competitors of RGC, provided that such representation does not involve a conflict of interest with respect to this engagement.
If a conflict of interest arises during the course of this engagement, the Firm will promptly notify the Company and the parties will work in good faith to resolve the conflict, including through the implementation of appropriate ethical screens or other measures. If the conflict cannot be resolved to the mutual satisfaction of the parties in a manner consistent with the applicable rules of professional conduct, the Firm may be required to withdraw from this engagement. In such event, the provisions of Section 10 below regarding termination shall apply.
9. Governing Law
This engagement letter and the relationship between Calderwood & Harkness LLP and Redstone Gaming Corp. shall be governed by and construed in accordance with the laws of the State of Nevada, without regard to principles of conflict of laws that would result in the application of the laws of any other jurisdiction. To the extent not governed by state law, this engagement letter shall also be subject to the Nevada Rules of Professional Conduct and any other applicable rules governing the practice of law in the State of Nevada.
Any disputes arising from or related to this engagement, including disputes regarding fees, the scope of services, or any other matter arising under this letter, shall be subject to the exclusive jurisdiction of the state and federal courts located in Clark County, Nevada. Each party hereby consents to the personal jurisdiction of such courts and waives any objection based on improper venue or inconvenient forum.
10. Term and Termination
This engagement shall commence as of the date of execution of this letter by both parties and shall continue until the earliest to occur of the following:
(a) the completion of the services described in Section 2.1 above, including the execution of the Executive Employment Agreement and any related ancillary documents by the Company and Mr. Ellender;
(b) the termination of the engagement by either party upon written notice to the other party, which notice may be given at any time and for any reason or no reason; or
(c) the occurrence of an event that makes continued representation impracticable or impermissible under the Nevada Rules of Professional Conduct or other applicable rules governing the practice of law, including, without limitation, the discovery of a disqualifying conflict of interest that cannot be resolved through consent or other appropriate measures.
Upon termination of this engagement for any reason, the Company will remain responsible for the payment of all professional fees earned and expenses incurred by the Firm through the date of termination, in accordance with the fee and billing terms set forth in Sections 5 and 6 above. The Firm will issue a final invoice within thirty (30) days of the effective date of termination.
In the event of termination, the Firm will cooperate fully with the Company in the orderly transition of the matter to successor counsel designated by the Company, including by making available to successor counsel all relevant files, documents, and work product prepared by the Firm in connection with this engagement, subject to the Firm's lien rights (if any) and the payment of all outstanding fees and expenses.
11. Document Retention
Following the conclusion of this engagement, the Firm will retain the engagement file (including correspondence, memoranda, drafts, and other work product) in accordance with the Firm's standard document retention policies, which currently provide for the retention of closed matter files for a period of seven (7) years following the date of file closure, unless a longer retention period is required by applicable law or regulation. At the conclusion of the retention period, the Firm may destroy the file and its contents without further notice to the Company.
Original documents and materials provided by the Company to the Firm during the course of this engagement will be returned to RGC upon the Company's written request, either during or after the engagement. The Company may request copies of the engagement file at any time during the retention period, and the Firm will provide such copies at the Company's expense.
12. No Guarantee of Outcome
While the Firm will devote its best professional efforts to the representation of Redstone Gaming Corp. in this matter, the Firm's agreement to undertake this engagement does not constitute, and should not be construed as, a guarantee or assurance of any particular outcome. The successful negotiation and execution of an executive employment agreement with Mr. Ellender will depend upon a number of factors outside the Firm's control, including the willingness of Mr. Ellender and his counsel to agree to the terms proposed by the Company, the approval of the Compensation Committee and Board of Directors, and other circumstances that may arise during the course of negotiations. The Firm will keep the Company informed of material developments and will provide its candid assessment of the progress and prospects of the negotiation at all times.
13. Acceptance and Execution
We respectfully request that you, on behalf of Redstone Gaming Corp., execute the enclosed duplicate original of this engagement letter in the space provided below and return it to the Firm at your earliest convenience to confirm the Company's agreement to the terms set forth herein. An executed copy may be returned by hand delivery, overnight courier, or email (PDF) to Renata Vasquez at the address or email set forth below. The original executed copy should follow by mail or courier.
We are enthusiastic about the opportunity to work with Redstone Gaming Corp. on this important matter and are confident that we can bring significant value to the process of structuring and negotiating an executive employment agreement that serves the Company's interests. Please do not hesitate to contact Renata Vasquez or Nadia Petrov if you have any questions regarding the terms of this letter or if you wish to discuss any aspect of the engagement before signing.
We look forward to getting started.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Name: Renata Vasquez
Title: Partner, Labor & Employment Practice Group
Responsible Partner
3900 Howard Hughes Parkway, Suite 800 Las Vegas, Nevada 89169 Telephone: (702) 555-3217
Email: rvasquez@calderwoodharkness.com
ACKNOWLEDGMENT AND ACCEPTANCE
The undersigned, on behalf of Redstone Gaming Corp., hereby acknowledges receipt of the foregoing Engagement Letter dated November 8, 2023 (Reference: 1033-00005; Matter No. 1033-00005) and agrees, on behalf of the Company, to the terms and conditions set forth therein.
ACKNOWLEDGED AND AGREED:
REDSTONE GAMING CORP.
By: ________
Name: Priya Narasimhan
Title: General Counsel
Date: ________
4100 Sandstone Ridge Boulevard Las Vegas, Nevada 89119
cc: Gavin T. Ashford, Chief Executive Officer, Redstone Gaming Corp. cc: Dean R. Fulbright, Chief Human Resources Officer, Redstone Gaming Corp. cc: Bernard Crawford, Billing Partner, Calderwood & Harkness LLP
Enclosure: Duplicate original of this Engagement Letter for execution and return
Timekeeper | Position | Hourly Rate
Renata Vasquez | Partner | $1,150.00
Bernard Crawford | Partner | $1,100.00
Nadia Petrov | Senior Associate | $785.00
James Underwood | Associate | $625.00

PRIVILEGED & CONFIDENTIAL

CALDERWOOD & HARKNESS LLP

ACKNOWLEDGMENT AND ACCEPTANCE

ACKNOWLEDGED AND AGREED:

REDSTONE GAMING CORP.

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