UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

 

FORM 8-K

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

 

 

Date of report (Date of earliest event reported): September 17, 2019

 

NTN BUZZTIME, INC.

(Exact name of Registrant as Specified in Charter)

 

Delaware   001-11460   31-1103425

(State or Other Jurisdiction

of Incorporation)

 

(Commission

File Number)

 

(I.R.S. Employer

Identification No.)

 

1800 Aston Ave., Suite 100    
Carlsbad, California   92008
(Address of Principal Executive Offices)   (Zip Code)

 

(760) 438-7400

(Registrant’s telephone number, including area code)

 

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

[  ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
   
[  ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
   
[  ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
   
[  ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
Common Stock   NTN   NYSE American

 

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company [  ]

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]

 

 

 

     
 

 

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

 

Appointment of Interim CEO and Senior Vice President of Finance

 

Effective as of September 17, 2019, our board of directors, on the recommendation of its nominating and corporate governance/compensation committee, appointed Allen Wolff as interim chief executive officer and appointed Sandra Gurrola as senior vice president of finance. Immediately before such appointment, Mr. Wolff was our chief financial officer and executive vice president, and Ms. Gurrola was our vice president of finance. Effective as of September 17, 2019, Mr. Wolff is the Company’s principal executive officer and Ms. Gurrola is the Company’s principal financial officer and principal accounting officer.

 

Mr. Wolff, age 47, was appointed as our chief financial officer and executive vice president in January 2016 and served as chief financial officer from December 2014 until he was appointed as our interim chief executive officer on September 17, 2019. From July 2013 until December 2014, Mr. Wolff served as the chief financial strategist of PlumDiggity, a privately-held financial and marketing strategy firm that he co-founded. From October 2012 to July 2013, Mr. Wolff served as the chief financial officer of 365 Retail Markets, a privately-held company in the self-checkout point of sale technology industry, where he also served on its board of directors during such period. From July 2011 to April 2013, simultaneous with his role at 365 Retail Markets, Mr. Wolff held the leadership role of “Game Changer” at Crowdrise, an online fundraising platform company. Mr. Wolff joined Crowdrise after serving as the chief operating officer and chief financial officer from January 2011 to July 2011 of RetailCapital, LLC, a small business specialty finance company. Mr. Wolff co-founded PaySimple in January 2006 and held various roles including president, chief financial officer, executive vice president and director, from 2006 until he left the company in January 2011. From September 1998 until August 2012, Mr. Wolff was a principal for a casual dining restaurant. Mr. Wolff holds a B.A. from the University of Michigan and an MBA, from the University of Maryland, R.H. Smith School of Business.

 

Ms. Gurrola, age 52, was appointed as our vice president of finance in September 2014 and held such position until she was promoted to senior vice president of finance on September 17, 2019. From November 2009 through September 2014, Ms. Gurrola served in various leadership accounting roles with us, including director of accounting, director of financial reporting and compliance, and controller. From July 2007 until April 2009, Ms. Gurrola served as senior manager of financial reporting for Metabasis Therapeutics, Inc., a biotechnology company, and served as a consultant to Metabasis from September 2009 to November 2009. Ms. Gurrola holds a B.A. in English from San Diego State University.

 

We are not aware of any transaction in which either Mr. Wolff or Ms. Gurrola has an interest requiring disclosure under Item 404(a) of Regulation S-K.

 

In connection with the appointments described above, we entered into an amendment to Mr. Wolff’s employment agreement dated March 19, 2018, and we entered into an employment agreement with Ms. Gurrola. Ms. Gurrola did not previously have a written employment agreement with us. The following is a summary of the material terms of the amendment to Mr. Wolff’s employment agreement and of Ms. Gurrola’s employment agreement.

 

Wolff

 

Under the terms of the amendment to Mr. Wolff’s employment agreement: (1) his duties and obligations were changed from those typically vested in a CFO to those typically vested in a CEO; (2) he will be entitled to a $30,000 bonus if (a) he remains employed by us for at least 180 days from September 17, 2019, or (b) a change in control (as such term is defined in our 2019 Performance Incentive Plan) occurs before such 180th day and he has been employed by us until the date of such change in control; and (3) he will be eligible to participate in the 2019 Interim CEO Performance Incentive Plan (the “2019 Interim CEO PIP”).

 

The 2019 Interim CEO PIP is a performance incentive plan under which, for the achievement of each of the three performance goals described therein (the “Performance Goals”), we will grant to Mr. Wolff such number of shares of our common stock (the “Performance Shares”) equal to $20,000 divided by the closing price per share of the Company’s common stock on the date of grant. The Performance Shares will be granted under, and be subject to, our 2019 Performance Incentive Plan and any Performance Shares granted will be evidenced by and subject to a stock award agreement to be entered into between us and Mr. Wolff. Upon grant, the Performance Shares will be fully vested.

 

     
 

 

The nominating and corporate governance/compensation committee will determine, in its sole discretion, whether the Performance Goals are achieved. The three Performance Goals are: (1) we must retain certain key employees to be determined by the nominating and corporate governance/compensation committee through at least March 17, 2020; (2) we must have a target amount of unrestricted cash, as determined and approved by the nominating and corporate governance/compensation committee, as of March 17, 2020; and (3) we must meet target sales for our Buzztime Basic product offering, as determined and approved by the nominating and corporate governance/compensation committee, by March 31, 2020. If a change in control (as defined in the 2019 2019 Performance Incentive Plan) is expected to occur, the nominating and corporate governance/compensation committee may, in its sole discretion, determine to grant all or a portion of the Performance Shares regardless of the extent to which the Performance Goals are achieved as of such time.

 

Gurrola

 

Base Salary. Ms. Gurrola’s salary will be $190,000, which increased from $175,000.

 

Incentive Bonus. Ms. Gurrola will be eligible to receive an annual incentive bonus in an amount to be determined by our board of directors (or its nominating and corporate governance/compensation committee) in its sole discretion, based on the achievement of performance objectives established by our board of directors (or its nominating and corporate governance/compensation committee). As of the effective date of Ms. Gurrola’s employment agreement, her target incentive bonus amount will be 20% of her base salary. Before such effective date, Ms. Gurrola’s target incentive bonus amount will remain at 10% of her base salary as of December 31, 2019. The performance objectives for 2019 fall into three categories (strategic, financial and operational), and are expected to remain the same for 2020. The incentive bonus will not be deemed earned and will not be paid unless the executive is employed by us on the applicable payment date. In lieu of the foregoing bonus arrangement, if our chief executive officer and chief financial officer and our nominating and corporate governance/compensation committee agree, our management team, including Ms. Gurrola, will instead be eligible to receive a spot bonus in an amount to be determined by our board of directors (or its nominating and corporate governance/compensation committee) in its sole discretion.

 

Vesting Acceleration. If a change in control occurs and if the executive is employed by us through the effective date of the change in control, then 100% of the then unvested portion of any stock unit award or stock options we granted to Ms. Gurrola before September 17, 2019 and that are then outstanding will vest as of immediately before such effective date.

 

Severance. If the executive’s employment with us is terminated by us without cause or by the executive for good reason, in addition to accrued and unpaid base salary, subject to the executive delivering to us a general release of claims in our favor, we will pay Ms. Gurrola a severance an amount equal to six months of her base salary rate in effect on the date her employment terminates, and provided that she timely elects continued insurance coverage pursuant to COBRA, we will reimburse her for a period of six months an amount equal to the difference between the amount of the COBRA premiums she actually paid each such month and the amount of the most recent premium she paid immediately before the date employment terminates for company-offered health insurance benefits.

 

The foregoing descriptions of Mr. Wolff’s amended employment agreement, the 2019 Interim CEO PIP, and Ms. Gurrola’s employment agreement are qualified in their entirety by reference to the full text of the such agreements, copies of which are filed as exhibits to this report and are incorporated herein by reference.

 

Resignation of CEO

 

On and effective as of September 17, 2019, Ram Krishnan voluntarily resigned as our chief executive officer and from our board of directors and he will voluntarily resign from all employment positions with us effective October 17, 2019. Mr. Krishnan’s decision to resign is not a result of any disagreement with us or our board relating to our operations, policies or practices.

 

In connection with Mr. Krishnan’s resignation, we and Mr. Krishnan entered into a limited term employment and separation agreement and general release of all claims (the “Krishnan Agreement”). Under the Krishnan Agreement, through October 17, 2019, Mr. Krishnan will serve as our director of special projects and he will work with our interim CEO and members of our board as-needed. His base salary will remain at the annualized rate of $350,000, and paid in accordance with our regular payroll practices over the limited term period of employment. If we terminate Mr. Krishnan’s employment without cause before October 17, 2019, then Mr. Krishnan will receive the base salary he would have received through October 17, 2019.

 

     
 

 

On the effective date of the Krishnan Agreement (which will be the eighth day after Mr. Krishnan signs it, provided he does not revoke it during the seven day period after he signs it), and in consideration for a release of claims, 5,000 of Mr. Krishnan’s outstanding restricted stock units (“RSUs”) will vest, and we will grant to Mr. Krishnan 30,000 RSUs, which will vest upon the effective date of a Change in Control Transaction. “Change in Control Transaction” means a transaction in which an individual, entity or group acquires all of our then-outstanding equity interests, whether by merger, tender offer, statutory share exchange, consolidation or similar corporate transaction, on or before March 17, 2020, or in which an individual, entity or group acquires 51% of our then-outstanding equity interests on or before March 17, 2020, and then that same individual, entity or group acquires the remaining equity so that it holds all of our then-outstanding equity interest on or before June 17, 2020.

 

Following the termination of his employment on October 17, 2019, and provided that he has executed an affirmation of release, an additional 5,000 of Mr. Krishnan’s outstanding RSUs will vest.

 

With Mr. Krishnan’s resignation from our board of directors, the number of directors constituting the whole board of directors was decreased from six to five.

 

We issued a press release announcing the changes in management described above, a copy of which is attached to this report as an exhibit and incorporated by reference herein.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits

 

No.   Description
*10.1   First Amendment to Employment Agreement dated September 17, 2019 by and between NTN Buzztime, Inc. and Allen Wolff
*10.2   2019 Interim CEO Performance Incentive Plan
*10.3   Employment Agreement dated September 17, 2019 by and between NTN Buzztime, Inc. and Sandra Gurrola
*10.4   Limited Term Employment and Separation Agreement and General Release of All Claims dated Separation 17, 2019 by and between NTN Buzztime, Inc. and Ram Krishnan
99.1   Press Release of NTN Buzztime, Inc. dated September 17, 2019

 

* Indicates management contract or compensatory plan

 

     
 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  NTN BUZZTIME, INC.
     
Date: September 17, 2019 By: /s/ Allen Wolff
    Allen Wolff
    Interim Chief Executive Officer

 

     
 

 

 

AMENDMENT #1 TO EMPLOYMENT AGREEMENT

 

THIS AMENDMENT #1 TO EMPLOYMENT AGREEMENT (this “Amendment”) is made and entered into this 17th day of September, 2019, by and between NTN Buzztime, Inc., a Delaware corporation (the “Company”), and Allen Wolff, an individual (the “Executive”).

 

RECITALS

 

THE PARTIES ENTER THIS AMENDMENT on the basis of the following facts, understandings and intentions:

 

A. The Executive commenced employment with the Company as of December 29, 2014. On or about March 19, 2018, the Company and Executive entered into an Employment Agreement (the “Employment Agreement”), pursuant to which Executive holds the position of the Company’s Chief Financial Officer.

 

B. The Company desires that the Executive be appointed and transition to the position of interim Chief Executive Office (“Interim CEO”) to carry out the duties and responsibilities described below, all on the terms and conditions set forth in this Amendment, effective as of the date set forth in the first paragraph (the “Effective Date”).

 

C. The Executive desires to continue employment and transition to the position of Interim CEO on the terms and conditions set forth in this Amendment.

 

D. The Nominating and Corporate Governance/Compensation Committee (the “Committee”) of the Board of Directors of the Company has determined and approved the terms of Executive’s continued employment on the terms and conditions set forth in this Amendment.

 

E. This Amendment, the Employment Agreement and all related documents referenced in the Employment Agreement shall govern the employment relationship between the Executive and the Company from and after the Effective Date.

 

NOW, THEREFORE, in consideration of the above recitals incorporated herein and the mutual covenants and promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby expressly acknowledged, the parties agree as follows:

 

1. Retention and Duties.

 

  1.1 Retention; Authorization to Work in the United States. Subject to the terms and conditions expressly set forth in this Amendment, the Company does hereby agree to continue the employment of the Executive and the Executive does hereby accept and agree to this engagement and employment. Executive’s employment with the Company is “at-will” and either the Company or Executive may terminate his employment with the Company at any time for any or no reason, subject to the terms and conditions set forth in this Amendment. The period of time during which Executive remains employed by the Company is referred to as the “Period of Employment.”

 

1

 

 

  1.2 Duties. Commencing on the Effective Date, the Executive shall no longer serve the Company in the position of CFO and shall commence in the position of its Interim CEO with the powers, duties and obligations of management typically vested in the office of the CEO of a corporation, subject to the directives of the Company’s Board of Directors (the “Board”) and to the corporate policies of the Company as they are in effect and as amended from time to time throughout the Period of Employment (including, without limitation, the Company’s business conduct and ethics policies). Specifically, the Interim CEO will work closely with the Board and senior management to to launch and execute the overall strategic and operational direction for the Company. The Executive will establish Company policies and objectives in accordance with board directives to achieve sustainable and cumulative growth over time. Moreover, the CEO will establish responsibilities and procedures for attaining objectives and reviews of operations and financial statements to evaluate achievement of those objectives. During the Period of Employment, the Executive shall report to the Board.

 

2. Compensation.

 

  2.1 Stay Bonus. Executive shall be entitled to a bonus in the amount of Thirty Thousand Dollars ($30,000) (the “Stay Bonus”) if (i) Executive remains employed by the Company for a period of at least One Hundred and Eighty (180) consecutive days from and after the Effective Date of this Amendment or (ii) the Company experiences a Change in Control prior to the 180th day after the Effective Date and the Executive has been continuously employed by Company from the Effective Date of this Agreement until the date of the Change in Control (either day shall be the “Stay Bonus Achievement Date”). Company shall pay the Executive the Stay Bonus as part of the first regularly scheduled pay period immediately following the Stay Bonus Achievement Date. For purposes of this section, Change in Control shall have the meaning set forth in the 2019 Performance Incentive Plan.
     
  2.2 Performance Incentive Plan. The Company shall establish the 2019 Interim CEO Performance Incentive Plan (a copy of which was delivered to the Executive on the date hereof) (the “Interim CEO PIP”), pursuant to which, and subject to the terms and conditions thereof, Executive shall be eligible to receive up to $60,000 worth of shares of the Company’s common stock if the performance goals described therein are achieved.

 

3. Governing Law. This Amendment, and all questions relating to its validity, interpretation, performance and enforcement, as well as the legal relations hereby created between the parties hereto, shall be governed by and construed under, and interpreted and enforced in accordance with, the laws of the State of California, notwithstanding any California or other conflict of law provision to the contrary.
   
4. Severability. If any provision of this Amendment or the application thereof is held invalid, the invalidity shall not affect other provisions or applications of this Amendment which can be given effect without the invalid provisions or applications and to this end the provisions of this Amendment are declared to be severable.

 

2

 

 

5. Conflict; Agreement. Except as modified by this Amendment, the Employment Agreement, together with all Stock Unit Agreements, stock option agreements and other agreement for equity-based compensation and the exhibits contemplated thereby, including the Confidentiality and Work for Hire Agreement and Mutual Agreement to Arbitrate, embody the entire agreement of the parties hereto respecting the matters within its scope. If there is a conflict between the terms and conditions of this Amendment and the Employment Agreement, this Amendment shall take precedence. Otherwise, all other terms and conditions of the Employment Agreement remain in full force and effect.
   
6. Counterparts. This Amendment may be executed in any number of counterparts, each of which shall be deemed an original as against any party whose signature appears thereon, and all of which together shall constitute one and the same instrument. This Amendment shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties reflected hereon as the signatories. Photographic copies of such signed counterparts may be used in lieu of the originals for any purpose.
   
7. Legal Counsel; Mutual Drafting. Each party recognizes that this is a legally binding contract and acknowledges and agrees that they have had the opportunity to consult with legal counsel of their choice. Each party has cooperated in the drafting, negotiation and preparation of this Amendment. Hence, in any construction to be made of this Amendment, the same shall not be construed against either party on the basis of that party being the drafter of such language. The Executive agrees and acknowledges that he has read and understands this Amendment, is entering into it freely and voluntarily, and has been advised to seek counsel prior to entering into this Amendment and has had ample opportunity to do so.

 

3

 

 

IN WITNESS WHEREOF, the Company and the Executive have executed this Amendment as of the first date set forth above.

 

  “COMPANY”
   
  NTN Buzztime, Inc., a Delaware corporation
     
  By: /s/ Steve Mitgang
  Name: Steve Mitgang
  Title: Chairman of the Nominating and Corporate Governance/Compensation Committee
   
  “EXECUTIVE”
   
  /s/ Allen Wolff
  Allen Wolff

 

4

 

 

 

2019 Interim CEO Performance Incentive Plan

 

Section   Description
1 Approval   This 2019 Interim CEO Performance Incentive Plan (this “Plan”) has been approved by the Nominating and Corporate Governance/ Compensation Committee (the “Committee”) of the Board of Directors (the “Board”) of NTN Buzztime, Inc. (the “Company” or “Buzztime”). This Plan may be changed or modified at any time at the discretion of the Committee.
       
2 Effective Date   September 17, 2019 (the “Effective Date”)
       
3 Eligibility   The sole employee of the Company eligible to participate in this Plan is Allen Wolff, the Company’s interim chief executive officer (“Wolff” or “Participant”). Only Wolff may earn incentive compensation under this Plan. Additionally, Wolff must confirm he read, understood, and agrees to abide by the term and conditions in this Plan and in his Personal Incentive Memo. This Plan is in addition to any other contractual agreement or incentive plan to which Wolff is a party or in which he participates.
       
4 Plan Design  

(1) Prerequisites to Earning Incentive Compensation

 

To earn incentive compensation under this Plan, subject to provisions of Section 6, the following criteria must be satisfied: (a) this Plan must be funded, based on the achievement of the Corporate Goals during the periods specified herein; and (b) Participant must be employed by Buzztime on the applicable Payout Date.

 

(2) Performance Goals

 

The Performance Goals are as follows:

 

    A.

The Company must retain certain key employees to be determined by the Committee through at least the six-month anniversary of the Effective Date (the “Key Employee Retention Goal”).

       
    B. The Company must have a target amount of unrestricted cash, as determined and approved by the Committee, as of the six-month anniversary of the Effective Date, (the “Cash Target Goal”).
       
    C. The Company must meet target sales with respect to its Buzztime Basic product offering, as determined and approved by the Committee, by March 31, 2020 (the “Buzztime Basic Goal”).

 

    (3) Target Payout Amount
     

 

For the achievement each Performance Goal, the Company will grant to Wolff such number of shares of the Company’s common stock (the “Performance Shares”) equal to $20,000 divided by the closing price per share of the Company’s common stock on the date of grant. For the avoidance of doubt, if all three of the Performance Goals are achieved, Mr. Wolff will be granted an aggregate of $60,000 worth of Performance Shares, based on the closing price per share of the Company’s common stock on each grant date.

 

The Performance Shares will be granted under, and be subject to, the Company’s 2019 Performance Incentive Plan (the “2019 PIP”) and any Performance Shares granted will be evidenced by and subject to a stock award agreement to be entered into between the Company and Mr. Wolff. Upon grant, the Performance Shares will be fully vested.

 

The Performance Shares will be adjusted when warranted pursuant to Sections 5 and 6.

 

     
 

 

     

(4) Performance Determination

 

The Committee will determine, in its sole discretion, whether the Performance Goals are achieved.

 

Notwithstanding anything to the contrary herein and to the extent not prohibited by law, in the event that a Change in Control (as defined in the 2019 PIP) is expected to occur, the Committee may, in its sole discretion, determine to grant all or a portion of the Performance Shares regardless of the extent to which the Performance Goals are achieved as of such time. If the Committee exercises its discretion to so grant all or a portion of the Performance Shares, the number of Performance Shares to be granted will be determined by dividing (A) a dollar amount to be determined by the Committee between $1.00 and $60,000.00 by (B) the closing price per share of the Company’s common stock on the date of grant. The Committee may determine to grant such Performance Shares contingent on, and effective as of immediately before, the closing of the Change in Control transaction.

       
5 Payout Details  

Payout Date(s): Subject to Section 8 (Company Management Rights), and provided all the of prerequisites to earning incentive compensation are met pursuant to Section 4 (Plan Design), the Performance Shares for each of the three Performance Goals will be granted as soon as practicable after the Committee determines that the applicable Performance Goal is achieved but no later than (A) with respect to the Key Employee Retention Goal and the Cash Target Goal, the 10th business day after the six month anniversary of the Effective Date; and (B) with respect to the Buzztime Basic Goal, the 10th business day after March 31, 2020 (the date on which the Performance Shares are actually granted, the “Payout Date”).

 

Plan Administration and Interpretation: This Plan shall be administered and interpreted by the Committee in its sole discretion. The Committee must approve any exceptions to the term and conditions of this Plan.

 

Notwithstanding the generality of the foregoing, the Committee also has sole discretion to determine the impact of any merger, acquisition or similar transaction or of any activities related thereto and/or of investments made beyond the core business of the Company as they relate to this Plan.

 

401k deferrals: In accordance with the NTN Buzztime, Inc. 401k Plan, no 401k deductions will be withheld from incentive (“bonus”) wages.

 

Taxes: Payments under this Plan are in addition to Wolff’s base salary and are included as total cash compensation and, as such, recorded on his W-2 (or applicable country statement) statement of wages. Such payments are considered taxable income and are reported as Gross Income (not “after taxes”). Wolff will have all appropriate payroll taxes and withholdings deducted from these payments at the IRS supplemental tax rate. Deductions from a payout in the form of shares of common stock shall be governed by the 2019 PIP (or any successor long-term incentive plan), and the applicable grant documentation, if any

       
6 Effect of Termination and Disciplinary Action  

Effect of Termination of Employment: Wolff must be employed on the Payout Date(s) to earn the Performance Shares. If he voluntarily resigns from employment prior to a Payout Date or if Buzztime terminates his employment prior to a Payout Date, no Performance Shares are earned.

 

Effect of Disciplinary Action: If Wolff is under disciplinary action (any level of performance counseling, warning and/or performance improvement plan), he will be ineligible to participate in this Plan. If upon reevaluation, however, he is released from disciplinary action, he will at that same time resume eligibility under this Plan and may be eligible to receive a prorated incentive amount that excludes the period of time he/she was under disciplinary action.

       
7 At Will Employment   Employment with Buzztime is at-will. This means that just as Participant is free to resign at any time, Buzztime reserves the right to discharge a Participant at any time, with or without cause or advance notice. In connection with the “at-will” employment relationship, Buzztime also reserves the right to exercise its managerial discretion in reassigning, transferring, promoting or demoting an employee, at any time. Participation in this Plan does not guarantee continued employment for any particular period of time or otherwise change Buzztime’s policy of employment at-will.
       
8 Company Management Rights   Buzztime reserves the right to amend or terminate this Plan, at any time, at the Committee’s discretion, with or without advance notice. Any amendments to this Plan will be in writing and approved by the Committee. If this Plan is amended or terminated prior to March 31, 2020, Participant will be paid, according to any amending or terminating documents. This Plan will automatically terminate at March 31, 2020, except that the payout provisions will continue in effect until satisfied.

 

-2-

 

 

Acknowledgement

 

Your signature below indicates that you have read, understood, and agreed to the 2019 Interim CEO Performance Incentive Plan, which includes the preceding 2 pages and the Personal Incentive Memo for your position. Information contained in these documents is strictly confidential and shall under no circumstances be shared with other employees of NTN Buzztime or with anyone outside the Company without the express consent of the Director of Human Resources of the Company unless required to do so under Sarbanes Oxley Act or the Securities Exchange Commission.

 

Date: September 17, 2019   /s/ Allen Wolff
      Allen D. Wolff

 

-3-

 

 

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into this 17th day of September, 2019, by and between NTN Buzztime, Inc., a Delaware corporation (the “Company”), and Sandra Gurrola, an individual (the “Executive”).

 

RECITALS

 

THE PARTIES ENTER THIS AGREEMENT on the basis of the following facts, understandings and intentions:

 

A. The Executive commenced employment with the Company as of November 4, 2009.

 

B. The Company desires that the Executive continue to be employed by the Company to carry out the duties and responsibilities described below, all on the terms and conditions set forth in this Agreement, effective as of the date set forth in the first paragraph (the “Effective Date”).

 

C. The Executive desires to continue employment on the terms and conditions set forth in this Agreement.

 

D. The Nominating and Corporate Governance/Compensation Committee (the “Committee”) of the Board of Directors of the Company has determined and approved the terms of Executive’s continued employment on the terms and conditions set forth in this Agreement.

 

E. This Agreement shall govern the employment relationship between the Executive and the Company from and after the Effective Date and supersedes and negates all previous agreements with respect to such relationship. Notwithstanding the foregoing, all indemnification agreements, restricted stock agreements, stock option agreements and agreements for equity-based benefits executed prior to the Effective Date shall not be deemed amended or revised by this Agreement, except as expressly amended or revised under the terms of this Agreement.

 

NOW, THEREFORE, in consideration of the above recitals incorporated herein and the mutual covenants and promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby expressly acknowledged, the parties agree as follows:

 

1. Retention and Duties.

 

  1.1 Retention; Authorization to Work in the United States. Subject to the terms and conditions expressly set forth in this Agreement, the Company does hereby agree to continue the employment of the Executive and the Executive does hereby accept and agree to this engagement and employment. Executive’s employment with the Company is “at-will” and either the Company or Executive may terminate his employment with the Company at any time for any or no reason, subject to the terms and conditions set forth in this Agreement. The period of time during which Executive remains employed by the Company is referred to as the “Period of Employment.”

 

  1  

 

 

  1.2 Duties. During the Period of Employment, the Executive shall serve the Company as its Senior Vice-President of Finance and Chief Accounting Officer (the “SVP”) and shall have the powers, duties and obligations of management typically vested in the office of Senior Vice-President of Finance and Chief Accounting Officer of a corporation, subject to the directives of the Company’s Board of Directors (the “Board”) and to the corporate policies of the Company as they are in effect and as amended from time to time throughout the Period of Employment (including, without limitation, the Company’s business conduct and ethics policies). Specifically, the SVP will work closely with the Board, the CEO and senior management to manage administrative, financial and risk management operations of the Company, including the financial and operational strategy and the metrics tied to that strategy, as well as the ongoing monitoring of the controls designed to preserve company assets and report accurate financial results. The Executive will assist in the development of Company policies and objectives in accordance with Board directives to achieve sustainable and cumulative growth over time. The Executive, in conjunction with the CEO, will establish responsibilities and procedures for attaining objectives and reviews of operations and financial statements to evaluate achievement of those objectives. Moreover, the Executive shall be responsible for overseeing all aspects of the Company’s accounting functions, ensuring its financial statements fairly represent the operations of the Company and that such financial statements are prepared in accordance with accounting principles generally accepted in the United States. During the Period of Employment, the Executive shall report to the CEO.
     
  1.3 No Other Employment. During the Period of Employment, the Executive shall both (i) devote substantially all of the Executive’s business time, energy and skill to the performance of the Executive’s duties for the Company, and (ii) hold no other employment. The Company shall have the right to request the Executive to resign from any board or similar body on which she may then serve if the Board reasonably determines that the Executive’s business related to such service is then in competition or conflicts with any business of the Company or any of its affiliates, successors or assigns. Nothing in this Section 1.3 shall be construed as preventing Executive from engaging in the investment of his personal assets.
     
  1.4 No Breach of Contract. The Executive hereby represents to the Company that: (i) the execution and delivery of this Agreement by the Executive and the Company and the performance by the Executive of the Executive’s duties hereunder shall not constitute a breach of, or otherwise contravene, the terms of any other agreement or policy to which the Executive is a party or otherwise bound; (ii) the Executive has no information (including, without limitation, confidential information and trade secrets) relating to any other person or entity which would prevent, or be violated by, the Executive entering into this Agreement or carrying out her duties hereunder; and (iii) except as set forth on Exhibit A hereto, the Executive is not bound by any confidentiality, trade secret or similar agreement other than this Agreement and the Confidentiality and Work for Hire Agreement entered into by the Executive as of November 4, 2009 and which is attached hereto as Exhibit B (the “Confidentiality and Work for Hire Agreement”) with any other person or entity.

 

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  1.5 Location. The Executive acknowledges that the Company’s principal executive offices are currently located in Carlsbad, California. The Executive agrees that she will work from the Company’s principal executive offices. The Executive acknowledges that he may be required to travel from time to time in the course of performing his duties for the Company.

 

2. Compensation.

 

  2.1 Base Salary. The Executive’s base salary (the “Base Salary”) shall be paid in accordance with the Company’s regular payroll practices in effect from time to time, but not less frequently than in monthly installments. The Executive’s Base Salary shall be at an annualized rate of One Hundred Ninety Thousand Dollars ($190,000).
     
  2.2 Incentive Bonus. Prior to the Effective Date and at all times during the Period of Employment, the Executive was, and shall be, eligible to participate in the NTN Buzztime, Inc. Executive Incentive Plan for Eligible Employees for fiscal year 2019. The Board and its nominating and corporate governance/compensation committee has determined that as of the Effective Date of this Agreement, the Executive’s Target Payout shall be in the amount of Twenty Percent (20%) of Executive’s Base Salary. Prior to the Effective Date, the Target Payout shall remain Ten Percent (10%) of the Executive’s Base Salary. This incentive payment shall be prorated to account for the increase in the Executive’s Target Payout rate and calculated from the Executive’s base salary compensation as of December 31, 2019.
     
    The Incentive Bonus, if any, will be paid to the Executive within thirty (30) days after receipt of the independent auditor’s report on the Company’s annual financial statements for the year in question; provided that the Incentive Bonus will not be deemed earned and will not be paid to the Executive unless the Executive is employed by the Company on such payment date. Payment of the Incentive Bonus, if any, will be subject to withholdings in accordance with the Company’s standard payroll procedures.
     
    In lieu of the Incentive Bonus, if the Company’s CEO and CFO and the nominating and corporate governance/compensation committee of the Board agree, the Executive shall instead be eligible to receive a spot bonus in an amount to be determined by the Board (or its nominating and corporate governance/compensation committee) in its sole discretion.
     
  2.3 Stock Units and Stock Option Grants. Prior to the Effective Date and during Executive’s tenure as an employee of the Company, Company has granted the Executive stock incentive benefits in the form of restricted stock units and stock options pursuant to approved Company incentive plans. Except as set forth in section 2.4 below, nothing in this Agreement shall be deemed to amend or otherwise alter the terms and conditions of any of those incentive plans and related agreements, including but not limited to the Amended 2010 Performance Incentive Plan and any Stock Unit Agreement and Stock Option Agreements entered into between the Company and the Executive.

 

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  2.4 Change in Control Incentive. In the event of a Change in Control (as defined in Section 4.4), and provided that the Executive is employed by the Company through the effective date of the Change in Control, then 100% of the then unvested portion of the stock units grant and of all stock options granted to the Executive prior to the date hereof that are then outstanding will vest and, if applicable, become exercisable as of immediately before such effective date.

 

3. Benefits.

 

  3.1 Retirement, Welfare and Fringe Benefits. During the Period of Employment, the Executive shall be entitled to participate in all employee pension and welfare benefit plans and programs, and fringe benefit plans and programs, made available by the Company to the Company’s employees generally, in accordance with the eligibility and participation provisions of such plans and as such plans or programs may be in effect from time to time.
     
  3.2 Reimbursement of Business Expenses. The Company will reimburse Executive for all reasonable business expenses the Executive incurs during the Period of Employment in the course and scope of the Executive’s duties, subject to the Company’s expense reimbursement policies in effect from time to time. Executive will be required to provide substantiation of all of such expenses on Company approved expense report forms in accordance with Company policies. These payments may be made as direct payments of the Executive’s invoices or bills or by reimbursement to the Executive of costs that are incurred. The Executive will be responsible for all income and employment taxes due on such payments; the Company will not provide a gross-up payment to cover such tax liabilities.
     
  3.3 Paid Time Off. During the Period of Employment, the Executive shall be permitted time off in accordance with the Company’s PTO policies in effect from time to time. The Executive shall also be entitled to all other holiday and leave pay generally available to other executives of the Company.

 

4. Termination.

 

  4.1 Termination of Employment. The Executive’s employment by the Company may be terminated either by the Company or by Executive at any time for any or no reason and with or without Cause (in any case, the date that the Executive’s employment with the Company terminates and which constitutes a “separation from service” within the meaning of Section 409A of the Code is referred to as the “Separation Date”).

 

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  4.2 Benefits Upon Termination. If the Executive’s employment with the Company is terminated for any reason by the Company or by the Executive, the Company shall have no further obligation to make or provide to the Executive, and the Executive shall have no further right to receive or obtain from the Company, any payments or benefits except as follows:

 

  (a) The Company shall pay Executive (or in the event of her death, the Executive’s estate) any Accrued Obligations (as defined in Section 4.4) within Ten (10) days following the Separation Date;
     
  (b) In addition to the Accrued Obligations, if the Executive’s employment with the Company is terminated by the Company without Cause or by the Executive for Good Reason, subject to tax withholding and other authorized deductions and subject to the requirements of Section 4.3, the Company shall: (i) pay the Executive as severance pay an amount equal to six (6) months of the Executive’s Base Salary rate in effect on the Separation Date, which shall be payable in one lump sum; and (ii) provided that the Executive timely elects continued insurance coverage pursuant to COBRA, reimburse the Executive for a period of six (6) months an amount equal to the amount of the COBRA premiums actually paid by the Executive each such month. The first installment of any severance pay payable under this Section 4.2(b) shall commence after the Executive executes the General Release and it has become effective in accordance with its terms and is not revoked.
     
  (c) Notwithstanding the foregoing provisions of this Section 4.2, if the Executive breaches his obligations under the Confidentiality and Work for Hire Agreement and/or Section 6, 7 or 8 of this Agreement at any time, from and after the date of such breach, the Executive will no longer be entitled to, and the Company will no longer be obligated to pay, any remaining unpaid portion of any benefits provided in Section 4.2(b).

 

    The foregoing provisions of this Section 4.2 shall not affect: (i) the Executive’s receipt of benefits otherwise due terminated employees under group insurance coverage consistent with the terms of the applicable Company welfare benefit plan; (ii) the Executive’s rights under COBRA to continue participation in medical, dental, hospitalization and life insurance coverage; or (iii) the Executive’s receipt of benefits otherwise due in accordance with the terms of the Company’s 401(k) plan (if any). In no event shall the Company’s obligations to the Executive exceed the sum of the Accrued Obligations, the benefits provided in Section 4.2(b), if applicable, and the benefits contemplated by this paragraph, regardless of the manner of the Executive’s termination of employment.

 

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  4.3 Release; Exclusive Remedy.

 

  (a) This Section 4.3 shall apply notwithstanding anything else contained in this Agreement or any stock option, restricted stock or other equity-based award agreement to the contrary. Notwithstanding any provision in this Agreement to the contrary, as a condition precedent to any Company obligation to the Executive pursuant to Section 4.2(b), or any agreement or obligation to accelerate vesting of any equity-based award in connection with the termination of the Executive’s employment, the Executive shall (i) upon or promptly following his Separation Date, sign and not revoke a general release agreement in a form prescribed by the Company (the “General Release”), and provided further that such general release agreement is executed and becomes effective no later than forty-five (45) days following the Executive’s Separation Date and (ii) at the Board’s request, provide the Company with a written resignation from the Board and all of its committees. The Company shall have no obligation to make any payment to the Executive pursuant to Section 4.2(b) unless and until the general release agreement contemplated by this Section 4.3 becomes irrevocable by the Executive in accordance with all applicable laws, rules and regulations and, at the Board’s discretion, the Executive shall have tendered the written resignation from the Board and its committees as contemplated above.
     
  (b) The Executive agrees that the General Release will include a complete release of all known and unknown claims pursuant to California Civil Code Section 1542 and will require that the Executive acknowledge, as a condition to the payment of any benefits under Section 4.2(b), that the payments contemplated by Section 4.2 shall constitute the exclusive and sole remedy for any termination of his employment, and the Executive will be required to covenant, as a condition to receiving any such payment, not to assert or pursue any other remedies, at law or in equity, with respect to any termination of employment. The Company and Executive acknowledge and agree that there is no duty of the Executive to mitigate damages under this Agreement. All amounts paid to the Executive pursuant to Section 4.2 shall be paid without regard to whether the Executive has taken or takes actions to mitigate damages.

 

  4.4 Certain Defined Terms.

 

  (a) As used herein, “Accrued Obligations” means:

 

  (i) any Base Salary that had accrued but had not been paid (including accrued and unpaid personal time off) on or before the Separation Date; and
     
  (ii) any reimbursement due to the Executive pursuant to Section 3.2 for expenses incurred by the Executive on or before the Separation Date.

 

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  (b) As used herein, “Cause” shall mean, as reasonably determined by the Board (excluding the Executive, if he is then a member of the Board), (i) any act of personal dishonesty taken by the Executive in connection with his responsibilities as an employee of the Company which is intended to result in substantial personal enrichment of the Executive and is reasonably likely to result in material harm to the Company, (ii) the Executive’s conviction of a felony which the Board reasonably believes has had or will have a material detrimental effect on the Company’s reputation or business, (iii) a willful act by the Executive which constitutes misconduct and is materially injurious to the Company, (iv) continued willful violations by the Executive of the Executive’s obligations to the Company after there has been delivered to the Executive a written demand for performance from the Company which describes the basis for the Company’s belief that the Executive has willfully violated his obligations to the Company.
     
  (c) As used herein, “Change in Control” has the meaning given to such term in the NTN Buzztime, Inc. 2010 Performance Incentive Plan.
     
  (d) As used herein, “Good Reason” shall mean, as reasonably determined by the Board (excluding the Executive, if he is then a member of the Board), (i) a change in the location of the Executive’s place of employment or the principal offices of the Company, in each case, as of the Effective Date resulting in an increased commuting distance of more than thirty (30) miles, (ii) a reduction in the amount of the Base Salary by 10% or more, (iii) a reduction in the percentage of the Executive’s target potential Incentive Bonus amount from the percentage in effect for the immediately preceding year or (iv) a change in the Executive’s position with the Company which materially reduces his duties and responsibilities; provided and only if such change, reduction or relocation is effected by the Company without the Executive’s consent. Notwithstanding the foregoing, a termination shall not be for Good Reason unless (A) the Executive provides written notice to the Company of his intent to terminate for Good Reason within thirty (30) days following the first occurrence of the circumstance that he believes constitute(s) Good Reason, which notice shall describe such circumstance, (B) the Company does not cure such circumstance within twenty (20) days following its receipt of such notice, and (C) the Executive voluntarily terminates his employment with the Company within thirty (30) days following the end of the twenty (20) day cure period.

 

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  4.5 Limitation on Benefits.

 

  (a) Notwithstanding anything contained in this Agreement to the contrary, to the extent that the payments and benefits provided under this Agreement and benefits provided to, or for the benefit of, the Executive under any other Company plan or agreement (such payments or benefits are collectively referred to as the “Benefits”) would be subject to the excise tax (the “Excise Tax”) imposed under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), the Benefits shall be reduced (but not below zero) if and to the extent that a reduction in the Benefits would result in the Executive retaining a larger amount, on an after-tax basis (taking into account federal, state and local income taxes and the Excise Tax), than if the Executive received all of the Benefits (such reduced amount if referred to hereinafter as the “Limited Benefit Amount”). Unless the Executive shall have given prior written notice specifying a different order to the Company to effectuate the Limited Benefit Amount, the Company shall reduce or eliminate the Benefits by first reducing or eliminating those payments or benefits which are not payable in cash and then by reducing or eliminating cash payments, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time from the Determination (as hereinafter defined). Any notice given by the Executive pursuant to the preceding sentence shall take precedence over the provisions of any other plan, arrangement or agreement governing the Executive’s rights and entitlements to any benefits or compensation.
     
  (b) A determination as to whether the Benefits shall be reduced to the Limited Benefit Amount pursuant to this Agreement and the amount of such Limited Benefit Amount shall be made by the Company’s independent public accountants or another certified public accounting firm of national reputation designated by the Company (the “Accounting Firm”) at the Company’s expense. The Accounting Firm shall provide its determination (the “Determination”), together with detailed supporting calculations and documentation to the Company and the Executive within five (5) days of the date of termination of the Executive’s employment, if applicable, or such other time as requested by the Company or the Executive (provided the Executive reasonably believes that any of the Benefits may be subject to the Excise Tax), and if the Accounting Firm determines that no Excise Tax is payable by the Executive with respect to any Benefits, it shall furnish the Executive with an opinion reasonably acceptable to the Executive that no Excise Tax will be imposed with respect to any such Benefits. Unless the Executive provides written notice to the Company within ten (10) days of the delivery of the Determination to the Executive that she disputes such Determination, the Determination shall be binding, final and conclusive upon the Company and the Executive.

 

5. Proprietary Information; Inventions and Developments. The Executive acknowledges having entered into the Confidentiality and Work for Hire Agreement, that she has abided by and not breached, and intends to continue to abide by and not breach, the terms, conditions and restrictions contained in it, and she hereby reaffirms the terms, conditions and restrictions and that as it relates to her, it remains in full force and effect.

 

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6. Confidentiality. The Executive hereby agrees that the Executive shall not at any time (whether during or after the Executive’s employment with the Company), directly or indirectly, other than in the course of the Executive’s duties hereunder, disclose or make available to any person, firm, corporation, association or other entity for any reason or purpose whatsoever, any Confidential Information (as defined below); provided, however, that this Section 6 shall not apply when (i) disclosure is required by law or by any court, arbitrator, mediator or administrative or legislative body (including any committee thereof) with apparent jurisdiction to order the Executive to disclose or make available such information (provided, however, that the Executive shall promptly notify the Company in writing upon receiving a request for such information), or (ii) with respect to any other litigation, arbitration or mediation involving this Agreement, including but not limited to enforcement of this Agreement. The Executive agrees that, upon termination of the Executive’s employment with the Company, all Confidential Information in the Executive’s possession that is in written, digital or other tangible form (together with all copies or duplicates thereof, including computer files) shall be returned to the Company and shall not be retained by the Executive or furnished to any third party, in any form except as provided herein; provided, however, that the Executive shall not be obligated to treat as confidential, or return to the Company copies of any Confidential Information that (a) was publicly known at the time of disclosure to the Executive, (b) becomes publicly known or available thereafter other than by any means in violation of this Agreement or any other duty owed to the Company by any person or entity, or (c) is lawfully disclosed to the Executive by a third party. As used in this Agreement, the term “Confidential Information” means: information disclosed to the Executive or known by the Executive as a consequence of or through the Executive’s relationship with the Company, about the customers, employees, business methods, public relations methods, organization, procedures or finances, including, without limitation, information of or relating to customer lists, of the Company Group.
   
7. Protective Covenant. The Executive acknowledges and agrees that should she accept a position of any business or organization where her duties, or those of others who report directly or indirectly to her, include any activities in the fields of electronically simulated trivia, sports games or other interactive experiences (e.g., advertising, single player arcade games), or tableside order and payment in the hospitality industry, which in the reasonable judgment of the Company is, or as a result of the Executive’s engagement or participation would become, directly competitive with any aspect of the business of the Company Group (a “Covered Position”), that such position would inevitably lead to a disclosure of Confidential Information in contravention of Section 6. Accordingly, and without limiting the provisions of Section 6, the Executive agrees that during the Period of Employment, the Executive shall not accept employment in a Covered Position. The Executive expressly acknowledges and agrees that the foregoing restriction is reasonable and necessary in order to protect the Confidential Information of the Company Group.
   
8. Anti-Solicitation.

 

  8.1 Business Relationships. The Executive promises and agrees that during the Period of Employment, the Executive will not, directly or indirectly, individually or as a consultant to, or as an employee, officer, stockholder, director or other owner or participant in any business, influence or attempt to influence customers, vendors, suppliers, joint venturers, associates, consultants, agents, or partners of the Company or any of its affiliates (collectively, the “Company Group”), either directly or indirectly, to divert their business away from the Company Group, to any individual, partnership, firm, corporation or other entity then in competition with the business of any entity within the Company Group, and he will not otherwise materially interfere with any business relationship of any entity within the Company Group.

 

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  8.2 Executives. The Executive promises and agrees that during the Period of Employment and for a period of one (1) year thereafter, the Executive will not, directly or indirectly, individually or as a consultant to, or as an employee, officer, stockholder, director or other owner of or participant in any business, solicit (or assist in soliciting) any person who is then, or at any time within six (6) months prior thereto was, an employee of an entity within the Company Group who earned annually $50,000 or more as an employee of such entity during the last six (6) months of his or her own employment to work for (as an employee, consultant or otherwise) any business, individual, partnership, firm, corporation, or other entity whether or not engaged in competitive business with any entity in the Company Group.

 

9. Withholding Taxes. Notwithstanding anything else herein to the contrary, the Company may withhold (or cause there to be withheld, as the case may be) from any amounts otherwise due or payable under or pursuant to this Agreement such federal, state and local income, employment, or other taxes as may be required to be withheld pursuant to any applicable law or regulation.
   
10. Assignment. This Agreement is personal in its nature and neither of the parties hereto shall, without the consent of the other, assign or transfer this Agreement or any rights or obligations hereunder; provided, however, that in the event of a merger, consolidation, or transfer or sale of all or substantially all of the assets of the Company with or to any other individual(s) or entity, this Agreement shall, subject to the provisions hereof, be binding upon and inure to the benefit of such successor and such successor shall discharge and perform all the promises, covenants, duties, and obligations of the Company hereunder.
   
11. Number and Gender. Where the context requires, the singular shall include the plural, the plural shall include the singular, and any gender shall include all other genders.
   
12. Section Headings. The section headings of, and titles of paragraphs and subparagraphs contained in, this Agreement are for the purpose of convenience only, and they neither form a part of this Agreement nor are they to be used in the construction or interpretation thereof.
   
13. Governing Law. This Agreement, and all questions relating to its validity, interpretation, performance and enforcement, as well as the legal relations hereby created between the parties hereto, shall be governed by and construed under, and interpreted and enforced in accordance with, the laws of the State of California, notwithstanding any California or other conflict of law provision to the contrary.

 

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14. Severability. If any provision of this Agreement or the application thereof is held invalid, the invalidity shall not affect other provisions or applications of this Agreement which can be given effect without the invalid provisions or applications and to this end the provisions of this Agreement are declared to be severable.
   
15. Entire Agreement. Except as otherwise expressly set forth herein, this Agreement, together with the Exhibits contemplated hereby, including the Confidentiality and Work for Hire Agreement and Mutual Agreement to Arbitrate, embodies the entire agreement of the parties hereto respecting the matters within its scope. This Agreement supersedes all prior and contemporaneous agreements of the parties hereto that directly or indirectly bears upon the subject matter hereof. Any prior negotiations, correspondence, agreements, proposals or understandings relating to the subject matter hereof shall be deemed to have been merged into this Agreement, and to the extent inconsistent herewith, such negotiations, correspondence, agreements, proposals, or understandings shall be deemed to be of no force or effect. There are no representations, warranties, or agreements, whether express or implied, or oral or written, with respect to the subject matter hereof, except as expressly set forth herein.
   
16. Modifications. This Agreement may not be amended, modified or changed (in whole or in part), except by a formal, definitive written agreement expressly referring to this Agreement, which agreement is executed by both of the parties hereto. Without limiting the foregoing, the at-will nature of Executive’s employment by the Company may only be modified in a writing approved by the Company’s Board of Directors and executed by both the Company and the Executive.
   
17. Waiver. Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver.
   
18. Arbitration. Any controversy arising out of or relating to the Executive’s employment (whether or not before or after the expiration of the Period of Employment), any termination of the Executive’s employment, this Agreement, the Confidentiality and Work for Hire Agreement referred to in Section 5, any Stock Unit Agreement, stock option agreement or any other agreements relating to the grant to Executive of equity-based awards, the enforcement or interpretation of any of such agreements, or because of an alleged breach, default, or misrepresentation in connection with any of the provisions of any such agreement, including (without limitation) any state or federal statutory claims, shall be submitted to arbitration in accordance with the provisions set forth on Exhibit C hereto.

 

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  Nothing in this Agreement or the attached Exhibit C shall prohibit or limit the parties from seeking provisional remedies under California Code of Civil Procedure section 1281.8, including, but not limited to, injunctive relief from a California court of competent jurisdiction. Without limiting the foregoing, the Executive and the Company acknowledge that any breach of any of the covenants or provisions contained in Section 6, 7 or 8 of this Agreement or in the Confidentiality and Work for Hire Agreement could result in irreparable injury to either of the parties hereto for which there might be no adequate remedy at law, and that, in the event of such a breach or threat thereof, the non-breaching party shall be entitled to obtain a temporary restraining order and/or a preliminary injunction and a permanent injunction restraining the other party hereto from engaging in any activities prohibited by any covenant or provision in Section 6, 7 or 8 of this Agreement or in the Confidentiality and Work for Hire Agreement or such other equitable relief as may be required to enforce specifically any of such covenants or provisions.

 

19. Insurance. The Company shall have the right at its own cost and expense to apply for and to secure in its own name, or otherwise, life, health or accident insurance or any or all of them covering the Executive, and the Executive agrees to submit to any usual and customary medical examination and otherwise cooperate with the Company in connection with the procurement of any such insurance and any claims thereunder.
   
20. Notices.

 

  (a) All notices, requests, demands and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given and made if (i) delivered by hand, (ii) otherwise delivered against receipt therefor, or (iii) sent by registered or certified mail, postage prepaid, return receipt requested. Any notice shall be duly addressed to the parties as follows:

 

  (i) if to the Company:
     
    NTN Buzztime, Inc.
    1800 Aston Avenue, Suite 100
    Carlsbad, CA 92008
    Attn:Board of Directors
     
  (ii) if to the Executive, the to address most recently on file in the payroll records of the Company.

 

  (b) Any party may alter the address to which communications or copies are to be sent by giving notice of such change of address in conformity with the provisions of this Section 20 for the giving of notice. Any communication shall be effective when delivered by hand, when otherwise delivered against receipt therefor, or five (5) business days after being mailed in accordance with the foregoing.

 

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21. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original as against any party whose signature appears thereon, and all of which together shall constitute one and the same instrument. This Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties reflected hereon as the signatories. Photographic copies of such signed counterparts may be used in lieu of the originals for any purpose.
   
22. Legal Counsel; Mutual Drafting. Each party recognizes that this is a legally binding contract and acknowledges and agrees that they have had the opportunity to consult with legal counsel of their choice. Each party has cooperated in the drafting, negotiation and preparation of this Agreement. Hence, in any construction to be made of this Agreement, the same shall not be construed against either party on the basis of that party being the drafter of such language. The Executive agrees and acknowledges that she has read and understands this Agreement, is entering into it freely and voluntarily, and has been advised to seek counsel prior to entering into this Agreement and has had ample opportunity to do so.
   
23. Code Section 409A.

 

  (a) It is intended that any amounts payable under this Agreement and the Company’s exercise of authority or discretion hereunder shall comply with Section 409A of the Code (including the Treasury regulations and other published guidance relating thereto) (“Code Section 409A”) so as not to subject the Executive to any interest or additional tax imposed under Code Section 409A. To the extent that any amount payable under this Agreement would trigger the additional tax imposed by Code Section 409A, the Agreement shall be modified to avoid such additional tax yet preserve (to the nearest extent reasonably possible) the intended benefit payable to the Executive.
     
  (b) Without limiting the generality of the foregoing, and notwithstanding any provision in this Agreement to the contrary, any payments made from the date of the Executive’s termination of employment through March 15th of the calendar year following such termination, are intended to constitute separate payments for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations and thus payable pursuant to the “short-term deferral” rule set forth in Section 1.409A-1(b)(4) of the Treasury Regulations; to the extent such payments are made following said March 15th, they are intended to constitute separate payments for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations made upon an involuntary separation from service and payable pursuant to Section 1.409A-1(b)(9)(iii) of the Treasury Regulations, to the maximum extent permitted by said provision, with any excess amount being regarded as subject to the distribution requirements of Section 409A(a)(2)(A) of the Code, including, without limitation, the requirement of Section 409A(a)(2)(B)(i) of the Code. For purposes of the foregoing, if upon Executive’s separation from service she is then a “specified employee” (within the meaning of Code Section 409A), then to the extent necessary to comply with Code Section 409A and avoid the imposition of taxes under Code Section 409A, the Company shall defer payment of “nonqualified deferred compensation” subject to Code Section 409A payable as a result of and within six (6) months following such separation from service under this Agreement until the earlier of (i) the first business day of the seventh month following Executive’s separation from service, or (ii) ten (10) days after the Company receives notification of Executive’s death. If the Company determines that any other payments hereunder fail to satisfy the distribution requirement of Section 409A(a)(2)(A) of the Code, then the payment of such benefit shall be delayed to the minimum extent necessary so that such payments are not subject to the provisions of Section 409A(a)(1) of the Code. Any payments that are delayed as a result of this Section 23(b) shall be paid without interest.

 

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IN WITNESS WHEREOF, the Company and the Executive have executed this Agreement as of the first date set forth above.

 

  “COMPANY”
   
  NTN Buzztime, Inc., a Delaware corporation
     
  By: /s/ Allen Wolff
  Name: Allen Wolff
  Title: Interim CEO
   
  “EXECUTIVE”
  /s/ Sandra Gurrola
  Sandra Gurrola

 

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EXHIBIT A

 

CONFIDENTIALITY DISCLOSURE

 

None.

 

  15  

 

 

EXHIBIT B

 

NTN BUZZTIME, INC.

 

CONFIDENTIALITY AND WORK FOR HIRE AGREEMENT

 

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EXHIBIT C

 

MUTUAL AGREEMENT TO ARBITRATE

 

This Mutual Arbitration Agreement (“Arbitration Agreement”) is entered into between NTN Buzztime, Inc. (“the Company”) and Sandra Gurrola, an individual (the “Executive”).

 

Agreement to Arbitrate Certain Disputes and Claims

 

Executive and Company agree that they will submit any claim, dispute, and/or controversy relating to or arising from Executive’s employment with Company to final and binding arbitration. Arbitration shall be the exclusive means of resolving the claim, dispute and/or controversy regardless of whether it is based on tort, contract, statute, equity and/or other laws. This shall include, but not be limited to, claims of wrongful termination, discrimination, harassment, conversion, theft of trade secrets, unfair competition, damage to person or property, breach of contract, defamation, violation of any other non-criminal federal, state or other governmental common law, statute, regulation or ordinance. This Arbitration Agreement shall apply to actions initiated by Executive or Company.

 

Company and Executive understand and agree that arbitration of the disputes and claims covered by this Arbitration Agreement shall be the sole and exclusive mechanism for resolving any and all existing and future disputes or claims arising out of Executive’s recruitment to or employment with the Company or the termination thereof, except as specified below.

 

Claims Not Subject to Arbitration

 

Company and Executive further understand and agree that the following disputes and claims are not covered by this Arbitration Agreement and shall therefore be resolved as required by the law then in effect:

 

  Executive’s claims for workers’ compensation benefits, unemployment insurance, or state or federal disability insurance.
     
  Either party’s request for temporary injunctive relief prior to resolution of the dispute on its merits in an arbitration proceeding.
     
  Any other dispute or claim that has been expressly excluded from arbitration by statute or binding legal precedent.
     
  Any claims which, as a matter of law then in effect, cannot be the subject of a mandatory arbitration agreement.

 

This Arbitration Agreement does not prevent Executive from filing a charge with certain local, state or federal administrative agencies such as the United States Equal Employment Opportunity Commission or the California Department of Fair Employment and Housing, or prevent Executive from filing for unemployment insurance or workers’ compensation benefits. Nothing in this Arbitration Agreement limits Executive’s rights, or those of the Company, to seek provisional relief pursuant to California Code of Civil Procedure section 1281.8 or any similar statute of applicable jurisdiction.

 

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Final and Binding Arbitration; Waiver of Trial Before Court, Jury or Government Agency

 

Company and Executive understand and agree that the arbitration of disputes and claims under this Arbitration Agreement shall be instead of a trial before a court or jury or a hearing before a government agency. Company and Executive understand and agree that, by signing this Arbitration Agreement, Company and Executive are expressly waiving any and all rights to a trial before a court or jury or before a government agency regarding any disputes and claims which Company and Executive now have or which Company and Executive may in the future have that are subject to arbitration under this Arbitration Agreement, except as provided in the preceding section.

 

Arbitration Procedures

 

Any arbitration held under this Arbitration Agreement shall be conducted before a single neutral arbitrator and shall be administered by the Judicial Arbitration and Mediation Service (“JAMS”) or its successor, unless the parties otherwise stipulate. The party initiating arbitration must provide written notice of the request to arbitrate to the other party and to JAMS within the applicable statute(s) of limitations. Written notice to the Company is to be directed to the Company’s Human Resources Department. The arbitration shall be conducted in accordance with the JAMS Employment Arbitration Rules and Procedures (the “JAMS Rules”), available for review at http://www.jamsadr.com, as those rules are in effect at the time of the arbitration; provided, however, that the arbitrator shall allow the discovery authorized by California Code of Civil Procedure section 1283.05 or any other discovery required by California law. The parties shall attempt to jointly select the single neutral arbitrator. If they are unable to reach agreement, the procedures contained in the JAMS Rules shall apply, or JAMS shall appoint the single arbitrator. The parties are entitled to be represented by counsel during the arbitration. To the extent that any of the JAMS Rules or anything in this Arbitration Agreement conflicts with any arbitration procedures required by California law, the arbitration procedures required by California law shall govern.

 

In the event JAMS is no longer able to supply the arbitrator, such arbitrator shall be selected from the American Arbitration Association (“AAA”) in accordance with AAA’s employment arbitration rules, available for review at http://www.adr.org, as those rules are in effect at the time of the arbitration, subject to the same terms and conditions as arbitration with JAMS as referenced in the preceding paragraph.

 

Place of Arbitration

 

The arbitration shall take place in San Diego County, California, or, at the Executive’s option, in the county in which the Executive works, or last worked, for the Company. The parties may agree to hold the arbitration at any other place mutually agreeable to both of them.

 

Discovery

 

The arbitrator shall allow the discovery authorized by California Code of Civil Procedure section 1283.05 or any other discovery required by California law.

 

Written Arbitration Award

 

In making an award, the Arbitrator shall have the authority to make any finding and determine any remedy congruent with applicable law, including an award of compensatory or punitive damages. In reaching a decision, the Arbitrator shall adhere to relevant law and applicable legal precedent, and shall have no power to vary therefrom.

 

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The Arbitrator shall issue a written award that sets forth the essential findings and conclusions on which the award is based. The Arbitrator shall have the authority to award any relief authorized by law in connection with the asserted claims or disputes. The Arbitrator’s award shall be final and binding on both the Company and Executive and it shall provide the exclusive remedy(ies) for resolving any and all disputes and claims subject to arbitration under this Arbitration Agreement. The Arbitrator’s award shall be subject to correction, confirmation, or vacation, by a competent California court as provided by California Code of Civil Procedure Section 1285.8 et seq and any applicable California case law setting forth the standard of judicial review of arbitration awards. The arbitrator shall not have the power to commit errors of law or legal reasoning, and the award may be vacated or corrected on appeal to a court of competent jurisdiction for any such error.

 

Governing Law

 

Company and Executive understand that this Arbitration Agreement and its validity, construction and performance shall be governed by the laws of the State of California, without reference to rules relating to conflicts of law. Any dispute(s) and claim(s) to be arbitrated under this Arbitration Agreement shall be governed by the laws of the State of California, without reference to rules relating to conflicts of law.

 

Costs of Arbitration

 

The Company will bear the arbitrator’s fee and any other type of expense or cost that the employee would not be required to bear if he or she were free to bring the dispute(s) or claim(s) in court as well as any other expense or cost that is unique to arbitration. If the Executive is the party initiating arbitration, he/she will be required to contribute to the administrative costs of the arbitration the same amount which he/she would have paid as a filing fee in order to commence the action in a civil court of law. The Company and Executive shall each bear their own attorneys’ fees incurred in connection with the arbitration, and the arbitrator will not have authority to award attorneys’ fees unless a statute or contract at issue in the dispute specifically authorizes the award of attorneys’ fees to the prevailing party, in which case the arbitrator shall have the authority to make an award of attorneys’ fees as required or permitted by applicable law. If there is a dispute as to whether the Company or Executive is the prevailing party in the arbitration, the Arbitrator will decide this issue.

 

Severability

 

Company and Executive understand and agree that if any term or portion of this Arbitration Agreement shall, for any reason, be held to be invalid or unenforceable or to be contrary to public policy or any law, then the remainder of this Arbitration Agreement shall not be affected by such invalidity or unenforceability but shall remain in full force and effect, as if the invalid or unenforceable term or portion thereof had not existed within this Arbitration Agreement.

 

Complete Agreement

 

Company and Executive understand and agree that this Arbitration Agreement and the Employment Agreement to which this agreement is attached contain the complete agreement between the Company and Executive regarding the subjects covered hereby; that it supersedes any and all prior representations and agreements between us, if any. This Arbitration Agreement may be modified only in a writing, expressly referencing this Arbitration Agreement and Executive by full name, and signed by the Chief Executive Officer of the Company. Any such written modification must also expressly state the intention of the parties to modify this Arbitration Agreement.

 

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Knowing and Voluntary Agreement

 

The Executive is advised to consult with attorneys of his or her own choosing before signing this Arbitration Agreement, and acknowledges that he or she has had an opportunity to do so. By signing this Arbitration Agreement, Executive agrees that he or she has read this Arbitration Agreement carefully and understand that by signing it, he or she is waiving all rights to a trial or hearing before a court or jury or government agency of any and all disputes and claims regarding Executive’s employment with the Company or the recruitment to or termination thereof (except as otherwise stated herein).

 

Consideration

 

The parties’ mutual agreement to arbitrate the claims identified herein, and the Company’s agreement to pay most of the costs associated with the arbitration, provide good and sufficient consideration for the mutual promises to arbitrate.

 

PLEASE READ CAREFULLY. BY SIGNING THIS AGREEMENT, EMPLOYEE AND THE COMPANY ARE GIVING UP THEIR RIGHT TO FILE A LAWSUIT IN A COURT OF LAW AND TO HAVE THEIR CASE HEARD BY A JUDGE OR JURY AS TO ANY CLAIMS COVERED BY THIS AGREEMENT TO ARBITRATE.

 

Date: September 17, 2019  

/s/ Sandra Gurrola

      Sandra Gurrola
       
Date: September 17, 2019   NTN Buzztime, Inc.
       
      /s/ Allen Wolff
      By: Allen Wolff
      Title: Interim CEO

 

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LIMITED TERM EMPLOYMENT AND SEPARATION AGREEMENT

AND GENERAL RELEASE OF ALL CLAIMS

 

This Limited Term Employment and Separation Agreement and General Release of All Claims (“Agreement”) is made by and between NTN BUZZTIME, INC. on behalf of itself and its affiliates (“Buzztime” or “the Company”) and Ram Krishnan (“Employee”) with respect to the following facts:

 

A. Employee is employed by the Company as the Chief Executive Officer pursuant to the terms of his Employment Agreement effective September 15, 2014 and amended on March 18, 2018 (the “CEO Employment Agreement”).

 

B. Employee and Company agree to terminate the CEO Employment Agreement as provided herein, and continue Employee’s employment with Company for a limited period of time as Director of Special Projects under the terms of this Agreement.

 

C. Company and Employee agree that Employee’s employment with the Company will terminate effective October 17, 2019 and that Employee’s termination will be considered as a voluntary resignation for all purposes.

 

D. To facilitate this transition, the Company is offering Employee consideration as described below provided Employee executes this Agreement no more than 21 days after his receipt of this Agreement, does not exercise the right to revoke it, and remains in compliance with its terms.

 

E. This Agreement is presented to Employee on September 16, 2019.

 

Company and Employee agree:

 

1. Retention. Subject to the terms expressly set forth in this Agreement, Company hereby employs the Executive, and Executive does hereby accept and agree to continue employment with Company, from the Effective Date of this Agreement until October 17, 2019 (the “Period of Employment”) as set forth in this Agreement. On October 17, 2019, Executive’s employment with the Company shall terminate, unless Company and Executive agree in writing to modify or extend the Period of Employment in writing.

 

1.1 Duties. During the Period of Employment, the Executive shall serve the Company as its Director of Special Projects (the “DSP”) and shall be subject to the directives of the Company’s Board of Directors (the “Board”), the Company’s Interim CEO and the corporate policies of the Company as they are in effect and as amended from time to time throughout the Period of Employment (including, without limitation, the Company’s business conduct and ethics policies). The DSP shall work closely with the Interim CEO on areas as directed by the Interim CEO or the Board, including but not limited to operations, customer strategy, product roadmap, potential or actual corporate transactions, and facilitating a smooth and efficient transition for the Interim CEO. DSP shall be available to provide in-person and telephonic guidance and consultation to members of the Board on an as-needed basis.

 

1.2 No Other Employment. During the Period of Employment, the Executive shall both (i) devote substantially all of the Executive’s business time, energy and skill to the performance of the Executive’s duties for the Company, and (ii) hold no other employment. The Company shall have the right to request the Executive to resign from any board or similar body on which he may then serve if the Board reasonably determines that the Executive’s business related to such service is then in competition or conflicts with any business of the Company or any of its affiliates, successors or assigns. Nothing in this Section 1.2 shall be construed as preventing Executive from engaging in the investment of his personal assets.

 

     

 

 

1.3 No Breach of Contract. The Executive hereby represents to the Company that: (i) the execution and delivery of this Agreement by the Executive and the Company and the performance by the Executive of the Executive’s duties hereunder shall not constitute a breach of, or otherwise contravene, the terms of any other agreement or policy to which the Executive is a party or otherwise bound; (ii) the Executive has no information (including, without limitation, confidential information and trade secrets) relating to any other person or entity which would prevent, or be violated by, the Executive entering into this Agreement or carrying out his duties hereunder; and (iii) the Executive is not bound by any confidentiality, trade secret or similar agreement, other than this Agreement and the Confidentiality and Work for Hire Agreement entered into by Executive with Company on or about September 16, 2014 (the “Confidentiality and Work for Hire Agreement”).

 

2. Compensation.

 

2.1 Base Salary. In exchange for Employee’s continued employment during the Period of Employment, agreement to, and compliance with, the terms of this Agreement, and execution of the general release of claims set forth in this Agreement, the Company shall pay Employee in accordance with the Company’s regular payroll practices in effect at the time, but not less frequently than in monthly installments, at the annualized rate of Three Hundred Fifty Thousand Dollars ($350,000) (the “Base Salary”). If Employee’s employment with the Company is terminated by the Company for any reason without Cause prior to the completion of the Period of Employment, Employee shall be entitled to receive the Base Salary for the entire Period of Employment. “Cause” shall have the meaning set forth under section 4.4(b) of the CEO Employment Agreement.

 

2.2 Additional Consideration.

 

(a) As consideration for the release of claims set forth in Section 4 of this Agreement, on the Effective Date of this Agreement as defined in Section 7.4 below, the Company agrees that 5,000 Restricted Stock Units (“RSUs”) of the Employee’s currently outstanding RSUs shall become fully vested and non-forfeitable; and (ii) Company shall grant to Employee 30,000 RSUs subject to the terms set forth in the 2019 Performance Incentive Plan and in accordance with the terms of an RSU agreement to be entered into by the Company and Employee (the “RSU Grant”). The RSU Agreement shall provide that the RSU Grant shall vest upon the effective date of a Change in Control Transaction. “Change in Control Transaction” means a transaction in which an individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) acquires all of the then-outstanding equity interests of the Company, whether by merger, tender offer, statutory share exchange, consolidation or similar corporate transaction on or before March 17, 2020, or in which an individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) acquires 51% of the then-outstanding equity interest of the Company on or before March 17, 2020, and then that same individual, entity or group acquires the remaining equity so that it holds all of the then-outstanding equity interest of the Company on or before June 17, 2020.

 

(b) Additionally, following the termination of his employment as DSP as provided in this Agreement, and provided that on or after termination of his employment as DSP, Employee has executed the Affirmation of Release (the “Affirmation”) attached hereto as Exhibit A, and provided further that Employee has not sought to revoke, invalidate, terminate or void this Agreement, the Company agrees that 5,000 Restricted Stock Units (“RSUs”) of the Employee’s currently outstanding RSUs shall fully vest.

 

2.3 Adequate Consideration. Employee agrees that the consideration in this Agreement is adequate for the promises and representations made in this Agreement, including Employee’s release set forth below and in the Affirmation, and for his continued compliance with the terms of this Agreement.

 

2.4 Termination for Cause. In the event of a termination by the Company of Employee’s employment prior to the completion of the Period of Employment for Cause, Company shall pay Employee any Base Salary that had accrued but had not been paid, including accrued and unpaid personal time off, as of the termination date and Company shall have no further obligations to make or provide to Employee, and Employee shall have no further right to receive or obtain from the Company, any payment, consideration or benefits.

 

     

 

 

3. Benefits.

 

3.1 Retirement, Welfare and Fringe Benefits; Paid Time Off. During the Period of Employment, the Executive shall be entitled to participate in all employee pension and welfare benefit plans and programs, and fringe benefit plans and programs, made available by the Company to the Company’s employees generally and to other executives of the Company, in accordance with the eligibility and participation provisions of such plans and as such plans or programs may be in effect from time to time. During the Period of Employment, Employee shall be permitted time off in accordance with the Company’s PTO policies in effect from time to time and shall also be entitled to all other holiday and leave pay generally available to other executives of the Company.

 

4. General Release.

 

4.1 Employee unconditionally, irrevocably and absolutely releases and discharges the Company, and any parent and subsidiary corporations, divisions and other affiliated entities of the Company, past and present, as well as the Company’s employees, officers, directors, agents, attorneys, successors and assigns (collectively, “Released Parties”), from all claims related in any way to the transactions or occurrences between them to date to the fullest extent permitted by law including, but not limited to, Employee’s employment with the Company, the amount and manner of compensation paid to Employee by the Company, the termination of Employee’s employment, and all other losses, liabilities, claims, demands and causes of action, known or unknown, suspected or unsuspected, arising directly or indirectly out of or in any way connected with Employee’s employment with the Company. This release is intended to have the broadest possible application and includes, but is not limited to, any tort, contract, common law, constitutional or other statutory claims, any claim for penalties, any claim for unpaid wages, commissions, bonuses or other employment benefits, as well as alleged violations of the California Civil Code, the California Labor Code, the California Government Code or the Fair Labor Standards Act, Title VII of the Civil Rights Act of 1964, the Occupational Safety and Health Act of 1973, and the California Fair Employment and Housing Act, the Americans with Disabilities Act, the Family and Medical Leave Act, the Equal Pay Act, the Age Discrimination in Employment Act, and the Older Workers Benefit Protection Act, all as amended, and all claims for attorneys’ fees, costs and expenses. However, this release will not apply to claims for workers’ compensation benefits, unemployment insurance benefits, or any other claims that cannot lawfully be waived.

 

4.2 Employee acknowledges that Employee may discover claims, facts or law different from, or in addition to, the claims, facts or law that Employee now knows or believes to be true with respect to the subject matter if this Agreement and the claims released in this Agreement and agrees, nonetheless, that this Agreement and the release contained in it shall be and remain effective in all respects despite such different or additional facts and Employee waives any and all claims that might arise as a result of such different or additional facts.

 

4.3 Employee declares and represents that Employee intends this Agreement to be final, complete, and not subject to any claim of mistake. Employee executes this release with the full knowledge that this release covers all possible claims against the Released Parties, to the fullest extent permitted by law. Employee acknowledges that he is not entitled to any payments related to the termination of his employment that may be provided for under the terms of his CEO Employment Agreement.

 

4.4 Employee waives Employee’s right to recover any type of personal relief from the Company, including monetary damages or reinstatement, in any administrative action or proceeding, whether state or federal, and whether brought by Employee or on Employee’s behalf by an administrative agency, related in any way to the matters released herein.

 

4.5 California Civil Code Section 1542 Waiver. Employee agrees that all rights under Section 1542 of the California Civil Code are expressly waived. That section provides:

 

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.

 

     

 

 

5. Representation Concerning Filing of Legal Actions. Employee represents that, with the exception of any claims Employee is prohibited by statute or court order from disclosing, as of the date of this Agreement, Employee has not filed any lawsuits, complaints, petitions, claims or other accusatory pleadings against the Company or any of the other Released Parties in any court. Employee further agrees that, to the fullest extent permitted by law, Employee will not prosecute in any court, whether state or federal, any claim or demand of any type related to the matters released above, it being the intention of the parties that with the execution of this release, the Released Parties will be absolutely, unconditionally and forever discharged of and from all obligations to or on behalf of Employee related in any way to the matters discharged herein. Employee also agrees that Employee will not voluntarily participate in, be a witness in, be a party to, or otherwise voluntarily involve himself in any claims, potential claim or litigation against Employer Released Parties. Employee further agrees that Employee will not voluntarily assist or encourage in any manner whatsoever any person, party, or litigant, in any claim, potential claim or action, against Employer Released Parties. This will not prevent Employee from responding to a legally issued subpoena, responding to inquiries from, or providing information to, a government or law enforcement agency.

 

6. No Admissions. By entering into this Agreement, the Released Parties make no admission that they have engaged, or are now engaging, in any unlawful conduct. The parties understand and acknowledge that this Agreement is not an admission of liability and shall not be used or construed as such in any legal or administrative proceeding.

 

7. Older Workers’ Benefit Protection Act. This Agreement is intended to satisfy the requirements of the Older Workers’ Benefit Protection Act, 29 U.S.C. sec. 626(f). The following general provisions, along with the other provisions of this Agreement, are agreed to for this purpose:

 

7.1 Employee acknowledges and agrees that he has read and understands the terms of this Agreement.

 

7.2 Employee is advised that Employee should consult with an attorney before executing this Agreement, and Employee acknowledges that Employee has obtained and considered any legal advice Employee deems necessary, such that Employee is entering into this Agreement freely, knowingly, and voluntarily.

 

7.3 Employee acknowledges that Employee has been given at least 21 days in which to consider whether or not to enter into this Agreement. Employee understands that, at Employee’s option, Employee may elect not to use the full 21-day consideration period.

 

7.4 This Agreement shall not become effective or enforceable until the eighth day after Employee signs this Agreement. In other words, Employee may revoke his acceptance of this Agreement within seven days after the date Employee signs it. Employee’s revocation must be in writing and received by the Director, Human Resources of Buzztime by 5:00 p.m. on the seventh day in order to be effective. If Employee does not revoke acceptance within the seven day period, Employee’s acceptance of this Agreement becomes binding and enforceable on the eighth day (“Effective Date”). Employee will notify the CEO and Chief Legal Counsel in writing on or shortly after the eighth day after he signs this Agreement as to whether Employee revoked the Agreement.

 

7.5 This Agreement does not waive or release any rights or claims that Employee may have that are based on any facts or events occurring after the execution of this Agreement.

 

     

 

 

8. Entire Agreement; Survival. This Agreement, together with any Stock Unit Agreements, Option Agreements and the Exhibits contemplated thereby, and the Confidentiality and Work for Hire Agreement and Mutual Agreement to Arbitrate, embodies the entire agreement of the parties hereto respecting the matters within its scope. This Agreement supersedes all prior and contemporaneous agreements of the parties hereto that directly or indirectly bears upon the subject matter hereof and Company and Employee agree that the CEO Employment Agreement is terminated and no longer of any force and effect, except that the following sections shall survive the termination and be incorporated in this Agreement as if fully set forth herein: Sections 4.5 Limitation on Benefits, 6 Confidentiality, 7 Protective Covenant, 8 Anti-Solicitation, 9 Withholding Taxes, 10 Assignment, 11 Number and Gender, 12 Section Headings, 13 Governing Law, 14, Severability, 16 Modifications, 17 Waiver, 18 Arbitration, 19 Insurance, 21 Counterparts, 22 Legal Counsel; Mutual Drafting, 23 U.S. Code Section 409A. Any prior negotiations, correspondence, agreements, proposals or understandings relating to the subject matter hereof shall be deemed to have been merged into this Agreement, and to the extent inconsistent herewith, such negotiations, correspondence, agreements, proposals, or understandings shall be deemed to be of no force or effect. There are no representations, warranties, or agreements, whether express or implied, or oral or written, with respect to the subject matter hereof, except as expressly set forth herein.

 

9. Notices

 

9.1 All notices, requests, demands and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given and made if (i) delivered by hand, (ii) otherwise delivered against receipt therefor, or (iii) sent by registered or certified mail, postage prepaid, return receipt requested. Any notice shall be duly address to the parties as follows:

 

(a) If to the Company:

1800 Aston Avenue, Suite 100

Carlsbad, CA 92008

Attn: Board of Directors

 

if to Employee, then to the address most recently on file in the payroll records of the Company.

 

Any party may alter the address to which communications or copies are to be sent by giving notice of such change of address in conformity with the provisions of this Section 20 for the giving of notice. Any communication shall be effective when delivered by hand, when otherwise delivered against receipt therefor, or five (5) business days after being mailed in accordance with the foregoing

 

10. Full Defense. This Agreement may be pled as a full and complete defense to, and may be used as a basis for an injunction against, any action, suit or other proceeding that may be prosecuted, instituted or attempted by Employee in breach hereof. Employee agrees that in the event an action or proceeding is instituted by the Released Parties in order to enforce the terms or provisions of this Agreement, the Released Parties shall be entitled to an award of reasonable costs and attorneys’ fees incurred in connection with enforcing this Agreement.

 

THE PARTIES TO THIS AGREEMENT HAVE READ THE FOREGOING AGREEMENT AND FULLY UNDERSTAND EACH AND EVERY PROVISION CONTAINED HEREIN. WHEREFORE, THE PARTIES HAVE EXECUTED THIS AGREEMENT ON THE DATES SHOWN BELOW.

 

Dated: September 17, 2019   By: /s/ Ram Krishnan
        Ram Krishnan
         
      NTN BUZZTIME, INC.
         
Dated:  September 17, 2019   By: /s/ Steve Mitgang
        Steve Mitgang

 

     

 

 

Exhibit A

 

AFFIRMATION OF RELEASE

 

(To be signed by Employee after the termination of employment)

 

I, Ram Krishnan (“Employee”), agree as follows:

 

A. I have previously executed a Limited Term Employment and Separation Agreement and General Release of Claims (“Agreement”).

 

B. My employment with Buzztime has now terminated.

 

C. I now wish to receive the Additional Consideration as described in the section 2.2(b) of Agreement. As a condition of receiving that Additional Consideration, I am agreeing to the terms of this Reaffirmation.

 

Now, therefore, I agree as follows:

 

I reaffirm my agreement to the all of the terms of the Agreement. In addition, I agree once again to the following specific provisions of the Agreement, with the intention that my release of claims fully apply to any and all transactions and occurrences after my execution of the Agreement, through the date of this Reaffirmation:

 

1. General Release.

 

1.1 Employee unconditionally, irrevocably and absolutely releases and discharges the Company, and any parent and subsidiary corporations, divisions and other affiliated entities of the Company, past and present, as well as the Company’s employees, officers, directors, agents, attorneys, successors and assigns (collectively, “Released Parties”), from all claims related in any way to the transactions or occurrences between them to date to the fullest extent permitted by law including, but not limited to, Employee’s employment with the Company, the amount and manner of compensation paid to Employee by the Company, the termination of Employee’s employment, and all other losses, liabilities, claims, demands and causes of action, known or unknown, suspected or unsuspected, arising directly or indirectly out of or in any way connected with Employee’s employment with the Company. This release is intended to have the broadest possible application and includes, but is not limited to, any tort, contract, common law, constitutional or other statutory claims, any claim for penalties, any claim for unpaid wages, commissions, bonuses or other employment benefits, as well as alleged violations of the California Civil Code, the California Labor Code, the California Government Code or the Fair Labor Standards Act, Title VII of the Civil Rights Act of 1964, the Occupational Safety and Health Act of 1973, and the California Fair Employment and Housing Act, the Americans with Disabilities Act, the Family and Medical Leave Act, the Equal Pay Act, the Age Discrimination in Employment Act, and the Older Workers Benefit Protection Act, all as amended, and all claims for attorneys’ fees, costs and expenses. However, this release will not apply to claims for workers’ compensation benefits, unemployment insurance benefits, or any other claims that cannot lawfully be waived.

 

1.2 Employee acknowledges that Employee may discover facts or law different from, or in addition to, the facts or law that Employee knows or believes to be true with respect to the claims released in this Agreement and agrees, nonetheless, that this Agreement and the release contained in it shall be and remain effective in all respects despite such different or additional facts.

 

1.3 Employee declares and represents that Employee intends this Agreement to be final, complete, and not subject to any claim of mistake. Employee executes this release with the full knowledge that this release covers all possible claims against the Released Parties, to the fullest extent permitted by law.

 

     

 

 

1.4 Employee expressly waives Employee’s right to recover any type of personal relief from the Company, including monetary damages or reinstatement, in any administrative action or proceeding, whether state or federal, and whether brought by Employee or on Employee’s behalf by an administrative agency, related in any way to the matters released herein. Employee expressly acknowledges that he is not entitled to any payments related to the involuntary termination of his employment that may be provided for under the terms of his Offer Letter dated April 13, 2015.

 

2. California Civil Code Section 1542 Waiver. Employee agrees that all rights under Section 1542 of the California Civil Code are expressly waived. That section provides:

 

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT IF KNOWN BY HIM OR HER WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASING PARTY.

 

3. Representation Concerning Filing of Legal Actions. Employee represents that, with the exception of any claims Employee is prohibited by statute or court order from disclosing, as of the date of this Agreement, Employee has not filed any lawsuits, complaints, petitions, claims or other accusatory pleadings against the Company or any of the other Released Parties in any court. Employee further agrees that, to the fullest extent permitted by law, Employee will not prosecute in any court, whether state or federal, any claim or demand of any type related to the matters released above, it being the intention of the parties that with the execution of this release, the Released Parties will be absolutely, unconditionally and forever discharged of and from all obligations to or on behalf of Employee related in any way to the matters discharged herein. Employee also agrees that Employee will not voluntarily participate in, be a witness in, be a party to, or otherwise voluntarily involve himself in any claims, potential claim or litigation against Employer Released Parties. Employee further agrees that Employee will not voluntarily assist or encourage in any manner whatsoever any person, party, or litigant, in any claim, potential claim or action, against Employer Released Parties. This will not prevent Employee from responding to a legally issued subpoena, responding to inquiries from, or providing information to, a government or law enforcement agency.

 

4. No Admissions. By entering into this Agreement, the Released Parties make no admission that they have engaged, or are now engaging, in any unlawful conduct. The parties understand and acknowledge that this Agreement is not an admission of liability and shall not be used or construed as such in any legal or administrative proceeding.

 

DO NOT SIGN THIS REAFFIRMATION UNTIL AFTER THE YOUR EMPLOYMENT HAS ENDED.

 

I have read, and I understand this Reaffirmation, and have voluntarily signed it on the date set forth below.

 

Date:      
      Ram Krishnan

 

     

 

 

 

BUZZTIME_4C

 

NTN Announces CEO Transition

- Ram Krishnan to Depart; CFO Allen Wolff to Act as Interim CEO -

 

CARLSBAD, Calif., September 17, 2019, — NTN Buzztime, Inc. (NYSE American: NTN), announced CEO Ram Krishnan will resign as CEO of the company effective September 17, 2019 and serve as an advisor through October 17, 2019. Effective September 17, 2019, CFO Allen Wolff will serve as interim CEO while the board conducts a search for a permanent CEO. Effective September 17, 2019, Mr. Krishnan will resign from the board, and the board has reduced its count to five directors.

 

Board Chair Gregg Thomas said, “We thank Ram for his leadership and contributions through our transformation from a single trivia platform to a multi-faceted product set. During Ram’s tenure, Buzztime improved gross margins and bottom-line to deliver 13 consecutive quarters of positive EBITDA with steady growth. Further, by investing in both software and hardware, Buzztime shortened the innovation cycle and broadened its product offerings, which includes a growing hardware solutions product line, tiered offerings in the core product line, an integrated and scalable ad network and content licensing.”

 

“I am excited Allen has stepped up to drive execution of our next phase. Together, Ram and Allen installed a culture and workplace that has just begun to transform our 35-year-old brand into the future. In addition to Allen’s unwavering enthusiasm and financial acumen, he is a shrewd operator and talented visionary. I look forward to working with Allen more closely,” added Mr. Thomas

 

Mr. Wolff stated, “I am thankful to Ram for his partnership over the past four and a half years and for his leadership in setting the foundation for the next stage of growth. I am honored to lead during our next transition.”

 

In addition, Sandra Gurrola, who has been at Buzztime for almost 10 years, was promoted to senior vice president of finance to assume some of Mr. Wolff’s prior responsibilities as CFO as well as continue to oversee all aspects of accounting and financial reporting, including SEC reporting, SOX, tax compliance, technical accounting, forecasting/modeling, and accounting operations.

 

Allen Wolff

 

Allen Wolff joined Buzztime in 2014 as Chief Financial Officer. Most recently, he was the Chief Financial Strategist at PlumDiggity, which specialized in early-stage technology companies and offered operational, financial, and marketing strategies to accelerate corporate growth, structure, and culture.  Allen started PlumDiggity after various roles in high growth companies, including PaySimple, which he co-founded in 2005.  PaySimple operates today as Evercommerce with recent financing valuing the company at nearly $2B.

 

Mr. Wolff graduated cum laude with a B.S. from University of Michigan and received his M.B.A. in Entrepreneurship and Finance from University of Maryland – Robert H. Smith School of Business.

 

About Buzztime:

 

Buzztime (NYSE American: NTN) delivers interactive entertainment and innovative technology that helps its customers acquire, engage and retain its patrons. Most frequently used in bars and restaurants in North America, the Buzztime tablets, mobile app and technology offer engaging solutions to establishments that have guests who experience dwell time, such as casinos, senior living, and more. Casual dining venues license Buzztime’s customizable solution to differentiate themselves via competitive fun by offering guests trivia, card, sports and arcade games. Buzztime’s platform creates connections among the players and venues and amplifies guests’ positive experiences. Buzztime’s in-venue TV network creates one of the largest digital out of home ad audiences in the US and Canada. Buzztime hardware solutions leverages the company’s experience manufacturing durable tablets and charging systems, enabling a diverse group of businesses including corrections, point-of-sale and loyalty with product implementation. Buzztime games have also been recently licensed by other businesses serving other markets.  For more information, please visit http://www.buzztime.com or follow us on Facebook or Twitter@buzztime.

 

IR AGENCY CONTACT:

 

Kirsten Chapman, LHA Investor Relations, buzztime@lhai.com 415-433-3777