Exhibit 10.14
AMENDMENT AND RESTATEMENT
OF
EMPLOYMENT AGREEMENT
THIS AMENDMENT AND RESTATEMENT is made and entered into as of October
4, 2000 in order to amend and restate in its entirety the following Employment
Agreement between the parties named below. The amendments made by this Amendment
and Restatement shall be effective as of August 23, 1999 (being the date of the
Compensation and Organization Committee meeting that approved these amendments)
but the other provisions of the Agreement shall be dated as of the original date
of the Agreement or as of the date of any prior amendments, as the case may be.
This Amendment and Restatement is intended to embody all previously agreed
amendments and to supercede all prior versions of the Agreement.
THIS AGREEMENT is made and entered into as of December 15, 1998, by and
among Radica Games Limited, a Bermuda company, having an office at Suite R, 6/F,
2-12 Au Xxx Xxx Street, Fo Tan, Hong Kong, Disc, Inc., a Nevada corporation (dba
Radica Innovations), having an office at 00000X Xxxx Xxxx, Xxxxxx, Xxxxx 00000,
and Xxx Xxx Wing, who resides at 0000 Xxxx Xxxxx Xxxxx, Xxxxx, Xxxxx 00000.
WHEREAS, Radica is engaged through its subsidiaries in designing and
manufacturing electronic and mechanical gifts and games for worldwide sale, and
ODM manufacturing for others;
WHEREAS, Radica Innovations is engaged in design services and
engineering for products manufactured by Radica;
WHEREAS, Employee has substantial executive management experience
including design and engineering experience;
WHEREAS, Radica Innovations desires to secure the services of Employee,
and Employee is willing to provide such services, each upon the terms and
subject to the conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises, the parties agree as
follows:
1. DEFINITIONS. For the purposes of this Agreement, the parties hereby adopt
the following definitions:
a) "Cause" means:
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(i) breach by Employee of a fiduciary obligation to any member of
Radica Group;
(ii) commission by Employee of any act or omission to perform any act
(excluding the omission to perform any act attributable to
Employee's Total Disability) which results in serious adverse
consequences to any member of Radica Group;
(iii) breach of any of Employee's agreements set forth in this
Agreement including, but not limited to, continual failure to
perform substantially his duties with Radica Group, excessive
absenteeism and dishonesty;
(iv) any attempt by Employee to assign or delegate this Agreement or
any of the rights, duties, responsibilities, privileges or
obligations hereunder without the prior written consent of Radica
(except in respect of any delegation by Employee of his
employment duties hereunder to other employees of Radica Group in
accordance with its usual business practice);
(v) Employee's arrest or indictment for, or written confession of, a
felony or any crime involving moral turpitude under the laws of
the United States or any state or of Hong Kong;
(vi) death of Employee;
(vii) declaration by a court that Employee is insane or incompetent to
manage his business affairs; or
(viii) the filing of any petition or other proceeding seeking to find
Employee bankrupt or insolvent.
(aa) A "Change in Control" shall be deemed to have occurred if, at any
time after the commencement of employment hereunder: (i) any person or group of
persons (as defined in Section 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended (the "1934 Act")) together with its affiliates, excluding
employee benefit plans of Radica, is or becomes, directly or indirectly, the
"beneficial owner" (as defined in rule 13d-3 promulgated under the 0000 Xxx) of
securities of Radica representing 50% or more of the combined voting power of
Radica's then outstanding securities; or (ii) as a result of a proxy contest,
merger, consolidation, sale of assets, tender offer or exchange offer or as a
result of any combination of the foregoing, Directors who were members of the
Board of Directors of Radica two years prior to such time and new Directors
whose election or nomination for election by Radica's shareholders was approved
by a vote of at least two-thirds of the Directors still in office who were
Directors two years prior to such time, cease to constitute at least two-thirds
of the members of the Board of Directors of Radica;
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or (iii) the shareholders of Radica approve a merger or consolidation of Radica
with any other corporation or entity regardless of which entity is the survivor,
other than a merger or consolidation which would result in the voting securities
of Radica outstanding immediately prior thereto continuing to represent (either
by remaining outstanding or being converted into voting securities of the
surviving entity) at least 50% of the combined voting power of the voting
securities of Radica or such surviving entity outstanding immediately after such
merger or consolidation; or (iv) the shareholders of Radica approve a plan of
complete liquidation or winding-up of Radica or an agreement for the sale or
disposition by Radica of all or substantially all of Radica's assets.
(b) "Dollars" and "US$" means United States dollars.
(c) "Employee" means Xxx Xxx Wing.
(cc) "Good Reason" shall mean the occurrence after a Change in Control
of any of the following events without the Employee's express written consent:
(i) the assignment to the Employee of duties inconsistent with his position and
status as an executive of the Radica Group, or a substantial alteration in the
nature, status or prestige of the Employee's responsibilities with the Radica
Group from those in effect immediately prior to such Change in Control; or (ii)
a reduction in the Employee's base salary or bonus at the rate most recently
approved by the Board prior to the occurrence of such Change in Control; or
(iii) any other material adverse change in the terms or conditions, including
location and travel, of the Employee's employment hereunder following the
occurrence of such Change in Control.
(d) "1994 Plan" means the 1994 stock option plan adopted by Radica, as
amended from time to time.
(e) "Radica" means Radica Games Limited, a Bermuda company.
(f) "Radica Group" means Radica, Radica Innovations and any other
corporation or other entity which at the relevant time is more than
fifty percent (50%) owned, directly or indirectly, by Radica.
(g) "Radica Innovations" means Disc, Inc., a Nevada corporation.
(h) "Termination" means, according to the context, the termination of this
Agreement or the cessation of rendering employment services by
Employee.
(i) "Total Disability" means Employee shall become disabled to an extent
which renders him unable to perform the essential functions of his
job, with or without reasonable accommodation, for a cumulative period
of twelve (12) weeks in any twelve (12) month period.
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2. EMPLOYMENT.
(a) Employee has previously been employed by Radica as Vice President,
Engineering and as one of the Directors of Radica. In such capacities,
Employee has had responsibility for design services and engineering
affecting the Radica Group generally, including Radica Innovations.
All prior employment agreements and arrangements between Radica Group
and Employee shall be superceded and merged into this Agreement, but
so that employment of Employee shall continue without any break in
service and with no change in the title or status of Employee for
purposes of his employment by Radica Group, except that Employee shall
be promoted to the title of Executive Vice President, Engineering of
Radica. Employee's principal employer within Radica Group shall be
Radica Innovations, but his duties shall extend to other members of
Radica Group. During his period of employment, employee also agrees to
serve in other executive capacities for Radica Group as may be
determined by the Board of Directors of Radica ("Board"). Employee
shall perform services of an executive nature consistent with his
offices with Radica Group as may from time to time be assigned or
delegated to him by the Board.
(b) Employee will devote his full business time and attention to his
duties under this Agreement.
(c) Employee shall perform his duties under this Agreement principally in
or around Dallas, Texas. It is contemplated Employee will frequently
travel to carry out his duties under this Agreement, including travel
to the offices of Radica Group in Nevada and California. Air travel
and other travel arrangements will comply with current Radica Group
policies respecting class of travel, etc.
(d) Radica Group will provide Employee, including his spouse and children,
with medical and dental benefits, and life insurance program, as
provided to other officers of Radica Group.
(e) Employee shall have four (4) weeks paid vacation during each year of
this Agreement taken at such times as mutually convenient to Employee
and Radica Group.
3. TERM OF EMPLOYMENT.
(a) This Agreement and Employee's employment hereunder shall commence as
of December 15, 1998 and continue until the second anniversary of such
date, and shall be renewed annually at each December 15 anniversary
date (commencing December 15, 1999) for an additional one year period
so that the term hereof at each renewal date shall be a two year
period, unless a party to this Agreement gives notice at least ninety
(90) days prior to such renewal date that this
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Agreement shall not be renewed, in which case this Agreement shall
terminate at the end of the ensuing year.
(b) Notwithstanding Paragraph (a) above, this Agreement may be sooner
terminated by Radica for Cause, by Employee without consent of Radica,
by Radica without Cause, or by Radica in the event of the Total
Disability of Employee. This Agreement may also be sooner terminated
by Employee following any Change in Control and if following such
Change in Control Employee has Good Reason for such Termination; such
Termination by Employee is herein called a "Termination/Change in
Control."
(c) On termination of this Agreement pursuant to Paragraph (a) above, or
by Radica for Cause, or by Employee without consent of Radica, all
benefits and compensation shall cease as of the date of such
Termination. On termination of this Agreement by Radica without Cause
or by Employee for Good Reason in the event of a Termination/Change in
Control or in event of Total Disability of Employee, all benefits and
compensation shall continue at the rate most recently approved by the
Board for twelve (12) months after such a Termination.
4. BUSINESS EXPENSE REIMBURSEMENT. Employee will be entitled to reimbursement
by Radica Group for the reasonable business expenses paid by him on behalf
of Radica Group in the course of his employment hereunder on presentation
to Radica Group of appropriate vouchers (accompanied by receipts or paid
bills) setting forth information sufficient to establish:
(i) the amount, date, and place of each such expense;
(ii) the business reason for each such expense and the nature of the
business benefit derived or expected to be derived as a result
thereof; and
(iii) the names, occupations, addresses, and other information
sufficient to establish the business relationship to Radica Group
of any person who was entertained by Employee.
5. COMPENSATION. Radica Innovations agrees to pay Employee, and Employee
agrees to accept from Radica Innovations, during the first year after
December 15, 1998, for the services to be rendered by him hereunder a
minimum salary at the rate of US $160,000 per annum payable in arrears in
monthly installments. Employee shall receive annual salary reviews by the
Board provided that such salary shall not be reduced below US $160,000 per
year.
Employee shall be considered for annual bonuses pursuant to the Radica
Games Bonus Policy for officers of Radica Group. Such Radica Games Bonus
Policy describes potential amounts of bonus which may be earned in respect
of each fiscal year, but with no mandatory amount for any particular
employee.
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If Radica Group institutes a retirement, bonus or other benefit plan which
applies generally to executive officers of Radica Group of similar status
as Employee, Employee shall be entitled to participate therein, but not to
the extent such benefits would be duplicative of the benefits herein.
All payments by Radica Group shall be subject to required withholdings
including taxes.
6. STOCK OPTIONS.
(a) (i) Nothing in this Agreement shall affect stock options previously
granted to Employee, which shall continue to be governed by the 1994
Plan and the terms of the grant of such stock options.
(ii) Additionally, at or promptly after the end of each of Radica's
Annual General Meetings held in 2000, 2001 and 2002, Radica shall
grant to Employee an option (up to three such options in total) to
purchase twenty-five thousand (25,000) shares (up to 75,000 shares in
the aggregate) of the common stock of Radica at the then applicable
market price, subject to the terms and conditions of this Section 6
and the 1994 Plan; provided, however, that each such grant shall be
subject to the conditions that (x) Employee continues to be employed
in good standing by Radica Group through the relevant date of grant
and (y) sufficient shares are available under the 1994 Plan to cover
Employee and other similarly situated executives (i.e. adequate shares
must be available for this special program in the option pool under
the 1994 Plan). If such quantity of shares is not available, the grant
dates will roll forward by one year per year until such shares are
available. Such stock options under this clause (ii) are herein called
the "Stock Options".
(iii) The Stock Options shall vest and become exercisable 20% per year
for each year Employee is employed by Radica Group following the date
of grant, commencing at the first anniversary of the date of grant.
(b) The number of shares subject to the Stock Options will be adjusted for
stock splits and reverse splits; provided that such number of shares
shall not be adjusted if Radica should otherwise change or modify its
capitalization, including but not limited to the issuance by Radica of
new securities (including options or convertible securities), ESOP's
or other employee stock plans. It is the intent of the parties that
the stock subject to the Stock Options shall be subject to dilution,
except for stock splits and reverse splits.
(c) Any other provision hereof to the contrary notwithstanding, (i) as of
the date of Termination in the event of Termination pursuant to
Section 3(a) or Termination by Radica for Cause or by Employee without
consent of Radica, or (ii) twelve (12) months after the date of
Termination in the event of Termination by Radica
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without Cause or by Employee for Good Reason in the event of a
Termination/Change in Control or the Total Disability of Employee
(each of such applicable dates being called a "Determination Date"),
Employee shall forfeit the Stock Options (measured by percentages of
the stock subject to the Stock Options) and they shall expire as
follows:
(A) if the Determination Date is within the first year after the
date the Stock Option is granted (the "Grant Date") then
Employee shall forfeit 100% of the stock subject to the
Stock Option;
(B) if the Determination Date is after the end of said first
year and within the second year after the Grant Date, then
Employee shall forfeit 80% of the stock subject to the Stock
Option;
(C) if the Determination Date is after the end of said second
year and within the third year after the Grant Date, then
Employee shall forfeit 60% of the stock subject to the Stock
Option;
(D) if the Determination Date is after the end of said third
year and within the fourth year after the Grant Date, then
Employee shall forfeit 40% of the stock subject to the Stock
Option; or
(E) if the Determination Date is after the end of said fourth
year and within the fifth year after the Grant Date, then
Employee shall forfeit 20% of the stock subject to the Stock
Option.
(d) In any event each Stock Option shall expire to the extent not
previously exercised on the tenth anniversary of the Grant Date.
Otherwise, Employee may at any time within ninety (90) days following
the Determination Date, exercise his right to purchase stock subject
to the Stock Options, but subject to the foregoing provisions
respecting vesting and forfeitures.
(e) Employee shall have no right to sell, alienate, mortgage, pledge, gift
or otherwise transfer the Stock Options or any rights thereto, except
by will or by the laws of descent and distribution, and except as
specifically contemplated in the 1994 Plan. In any event, any transfer
must comply with applicable state and federal securities laws.
7. NON-COMPETE; CONFIDENTIALITY.
(a) During the term of employment of Employee, and for a period of one
year after any Termination (other than in the event of a
Termination/Change in Control) of such relationship or employment for
any reason (either by Employee or Radica), with or without cause,
voluntarily or involuntarily (the period of employment plus such
additional year being called the "Prohibition Period"), Employee
agrees that
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he will not engage in, be employed by or become affiliated with, in
the United States of America or anywhere else in the world, directly
or indirectly, any person or entity which offers, develops, performs
or is engaged in services, products or systems which are competitive
with the business of Radica Group or any other products, services or
systems hereafter developed, produced or offered by Radica Group, to
be determined at the relevant time but not later than the commencement
of such one-year period ("Companies' Business"). During the
Prohibition Period, Employee shall not, directly or indirectly, become
an owner or member, to the extent of an ownership interest of five
percent (5%) or more, of a joint venture, partnership, corporation or
other entity, or a consultant, employee, agent, officer or director of
a corporation, joint venture, partnership or other entity, which is
competitive with, directly or indirectly, the Companies' Business.
(b) Employee understands and agrees that he has been exposed to (or had
access to), and may be further exposed to (or have access to),
confidential information, knowhow, knowledge, data, techniques,
computer software and hardware, and trade secrets of Radica Group or
related to the Companies' Business, including, without limitation,
customer or supplier requirements, notes, drawings, writings, designs,
plans, specifications, records, charts, methods, procedures, systems,
price lists, financial data, records, and customer or supplier lists
(collectively "Confidential Information"). Notwithstanding the above,
the following shall not be considered "Confidential Information"
within the meaning of this section: (a) information known to Employee
or to the public at the date of this Agreement; and (b) information
which hereafter becomes known to the public through no fault of
Employee. Accordingly, except as permitted or required in the
performance of his duties for Radica Group, Employee agrees not to
disclose, divulge, make public, utilize, communicate or use, whether
for his own benefit or for the benefit of others, either directly or
indirectly, any Confidential Information relating to the Companies's
Business unless specifically authorized in writing by Radica to do so.
(c) Employee shall promptly communicate and disclose to Radica Group all
information, inventions, improvements, discoveries, knowhow, methods,
techniques, processes, observations and data ("Proprietary
Information") obtained, developed, invented or otherwise discovered by
him in the course of this employment. All written materials, records,
computer programs or data and documents made by Employee or coming
into his possession during the employment period concerning any
Proprietary Information used or developed by Radica Group, or by
Employee, shall be the sole exclusive property of Radica Group.
Employee shall have no right, title or interest therein
notwithstanding that he may have purchased the medium on which such
Proprietary Information is recorded.
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(d) Upon Termination, Employee shall not take with him any of the
Confidential Information or Proprietary Information. Upon Termination,
or at any time upon the request of Radica, Employee shall promptly
deliver all Confidential Information and Proprietary information, and
all copies thereof, to Radica Group with no cost or charge to Radica
Group. Upon request by Radica, Employee shall promptly execute and
deliver any documents necessary or convenient to evidence ownership of
the Confidential Information and Proprietary Information by Radica
Group, or the transfer and assignment of the Confidential Information
and Proprietary Information to Radica Group without cost or charge.
The provisions of this Section 7 shall survive any Termination of this
Agreement.
8. BENEFIT AND BINDING EFFECT. This Agreement shall inure to the benefit of
and be binding upon Radica and Radica Innovations, their successors and
assigns, including but not limited to any corporation, person or other
entity which may acquire all or substantially all of the assets and
business of Radica or Radica Innovations or any corporation with or into
which they may be consolidated or merged. Radica and Radica Innovations may
assign their rights and obligations to another present or future member of
Radica Group. The rights and obligations of Employee hereunder may not be
delegated or assigned, except that Employee may, without the prior consent
of any member of Radica Group, assign to his spouse, or to a family member,
proceeds of payments resulting from his death or a disability which, in
either case, occurs after a termination of this Agreement.
9. COUNTERPARTS. This Agreement may be executed in counterparts, each of which
shall be deemed an original but all of which shall constitute one and the
same instrument.
10. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF NEVADA WITHOUT REFERENCE TO THE
CHOICE OF LAW PRINCIPLES THEREOF.
11. ENTIRE AGREEMENT. This Agreement sets forth and is an integration of all of
the promises, agreements, conditions and understandings among the parties
hereto with respect to all matters contained or referred to herein, and all
prior promises, agreements, conditions, understandings, warranties or
representations, oral, written, express or implied, are hereby superseded
and merged herein.
12. VALIDITY OF PROVISIONS. Should any provision(s) of this Agreement be void
or unenforceable in whole or in part, the remainder of this Agreement shall
not in any way be affected thereby, and such provision(s) shall be modified
or amended so as to provide for the accomplishment of the provision(s) and
intentions of this Agreement to the maximum extent possible.
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13. MODIFICATIONS OR DISCHARGE. This Agreement shall not be deemed waived,
changed, modified, discharged or terminated in whole or in part, except as
expressly provided for herein or by written instrument signed by all
parties hereto.
14. NOTICES. Any notice which either party may wish to give to the other
parties hereunder shall be deemed to have been given when actually received
by the party to whom it is addressed. Notices by Employee to either Radica
or Radica Innovations shall be sent to both of them. Notices hereunder may
be sent by courier, mail, telefax, telegram or telex, to the following
addresses, or to such other addresses as the parties may from time to time
furnish to each other by like notice:
To: Disc, Inc.
(dba Radica Innovations).
000 Xxxxx Xxxx Xxxxxx
Xxxxx 000 Xxxxxxxx, Xxxxxxxxxx 00000
X.X.X.
Attention: Xxxxxxx X. Xxxxx
Telephone: (000) 000-0000
Telefax: (000) 000-0000
To: Radica Games Limited
Suite R, 6/F
2-12 Au Xxx Xxx Street
Fo Tan
Hong Kong
Attention: Xxxxx X.X. Xxxxxx
Telephone: (000) 0000 0000
Telefax: (000) 0000 0000
To: Employee:
Xx. Xxx Xxx Xxxx
0000 Xxxx Xxxxx Xxxxx
Xxxxx, Xxxxx 00000
X.X.X.
Telephone: (000) 000-0000
Telefax: (000) 000-0000
15. NUMBER; GENDER. In this Agreement, the masculine shall include the feminine
and neuter and vice versa, and the singular shall include the plural and
vice versa, as the context may reasonably require or permit.
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IN WITNESS WHEREOF, the parties have executed this Amendment and
Restatement as of the day and year first above written.
RADICA GAMES LIMITED
By: /s/ Xxxxxxx X. Xxxxx
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DISC, INC. (dba RADICA INNOVATIONS)
By: /s/ Xxxxxxx X. Xxxxx
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XXX XXX WING
/s/ Xxx Xxx Wing
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