Exhibit 4.18
AGREEMENT
This Agreement dated as of this 31st day of March, 2003, between Radica
Enterprises, Ltd, a corporation organized under the laws of Nevada ("Radica
USA") and a wholly owned subsidiary of, Radica Games Limited, a corporation
organized under the laws of Bermuda ("Radica"), and Xxxxxxx X. Xxxxx (the
"Executive").
WHEREAS, Executive is currently employed as the President and Chief
Executive Officer of Radica and President of Radica USA and desires to remain so
employed;
WHEREAS, this Agreement is entered into in connection with Executive's sale
of his shares of Radica, in consideration for the payment described in Section 2
hereof, and in consideration of the confidential information provided by Radica
and Radica USA to Executive;
NOW, THEREFORE, in consideration of the foregoing and the mutual
commitments contained in this Agreement, the parties hereto agree as follows:
1. Effectiveness.
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(a) This Agreement shall become effective upon a Change in Control of
Radica that occurs on or before March 31, 2004 or as a result of a definitive
agreement that is signed on or before March 31, 2004. For purposes of this
Agreement, a "Change in Control" shall be defined as in the Change in Control
Bonus Agreement, dated March 31, 2003, between Radica, Radica USA and Executive.
2. Consideration.
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Upon the occurrence of a Change in Control, Radica will pay to
Executive the amount of $665,200 and provide certain Confidential Information in
consideration for his complying with the covenants in Sections 3, below.
3. Covenant not to Compete; Nonsolicitation; Confidential Information.
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(a) Non-Compete. During the two year period following a Change in
Control (the "Restrictive Period"), the Executive shall not directly or
indirectly (without the prior written consent of Radica):
(i) hold a 5% or greater equity (including stock options whether or not
exercisable), voting or profit participation interest in a Competitive
Enterprise, or
(ii) associate (including as a director, officer, employee, partner,
consultant, agent or advisor) with a Competitive Enterprise and in
connection
with the Executive's association engage, or directly or indirectly manage
or supervise personnel engaged, in any activity:
(A) that is substantially related to any activity that the
Executive was engaged in with Radica or Radica USA or their affiliates
during the 12 months prior to the Change in Control,
(B) that is substantially related to any activity for which the
Executive had direct or indirect managerial or supervisory responsibility
with Radica or Radica USA or their affiliates during the 12 months prior to
the Change in Control, or
(C) that calls for the application of specialized knowledge or
skills substantially related to those used by the Executive in his
activities with Radica or Radica USA or their affiliates during the 12
months prior to the Change in Control.
For purposes of this Agreement, "Competitive Enterprise" means any business
enterprise that either (A) engages in, designs, develops, manufactures, markets
or sells products in any of the following lines of business as defined by NPD
Group, Inc.: (i) electronic handheld and tabletop games, (ii) youth electronics,
or (iii) video game accessories, or (B) holds a 5% or greater equity, voting or
profit participation interest in any enterprise that engages in such a
competitive activity.
(b) Non-Solicit. During the Restrictive Period, the Executive shall
not, in any manner, directly or indirectly (without the prior written consent of
Radica): (i) Solicit any Customer to transact business with a Competitive
Enterprise or to reduce or refrain from doing any business with Radica or Radica
USA, (ii) transact business with any Customer that would cause the Executive to
be a Competitive Enterprise, (iii) interfere with or damage any relationship
between Radica or Radica USA and a Customer or (iv) Solicit anyone who is then
an employee of Radica or Radica USA (or who was an employee of Radica or Radica
USA within the prior 12 months) to resign from Radica or Radica USA or to apply
for or accept employment with any other business or enterprise.
For purposes of this Agreement, a "Customer" means any customer or prospective
customer of Radica, Radica USA or their affiliates to whom the Executive
provided services, or for whom the Executive transacted business, or whose
identity became known to the Executive in connection with his relationship with
or employment by Radica or Radica USA, and "Solicit" means any direct or
indirect communication of any kind, regardless of who initiates it, that in any
way invites, advises, encourages or requests any person to take or refrain from
taking any action.
(c) Confidential Information. The Executive hereby acknowledges that,
as an employee of Radica and Radica USA, Radica and Radica USA are providing him
and he is making use of, acquiring and adding to confidential information of a
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special and unique nature and value relating to Radica and Radica USA and their
strategic plan and financial operations. The Executive further recognizes and
acknowledges that all confidential information is the exclusive property of
Radica and Radica USA, is material and confidential, and is critical to the
successful conduct of the business of Radica and Radica USA and to the
Executive's performance of his duties while employed. Accordingly, the Executive
hereby covenants and agrees that he will use confidential information for the
benefit of Radica and Radica USA only and shall not at any time, directly or
indirectly, during the Restrictive Period and thereafter divulge, reveal or
communicate any confidential information to any person, firm, corporation or
entity whatsoever, or use any confidential information for his own benefit or
for the benefit of others.
4. Notice to New Employers.
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Before the Executive either applies for or accepts employment with any
other person or entity during the Restrictive Period, the Executive will provide
the prospective employer with written notice of the provisions of Section 3 of
this Agreement and will deliver a copy of the notice to Radica.
5. Entire Agreement; Modification.
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This Agreement contains the entire agreement between Executive, Radica
and Radica USA, and it is the complete, final and exclusive embodiment of our
agreement with regard to this subject matter. It is entered into without
reliance on any promise or representation other than those expressly contained
herein, and it cannot be amended except in writing signed by both parties.
The terms and provisions of this Agreement are intended to be separate
and divisible provisions and if, for any reason, any one or more of them is held
to be invalid or unenforceable, neither the validity nor the enforceability of
any other provision of this Agreement shall thereby be affected. The parties
hereto acknowledge and agree that the potential restrictions on the Executive's
future employment imposed by Section 3 of this Agreement are reasonable in both
duration and geographic scope and in all other respects. If for any reason any
court of competent jurisdiction shall find any provisions of Section 3 of this
Agreement unreasonable in duration or geographic scope or otherwise, the
Executive, Radica and Radica USA agree that the restrictions and prohibitions
contained therein shall be automatically reformed to the fullest extent allowed
under applicable law in such jurisdiction.
In the event that the Executive challenges the enforceability of this
Agreement and a court finds that this Agreement is unenforceable, the Executive
shall repay to Radica an amount equal to the Consideration provided for in
Section 2 within 10 business days following such determination.
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6. Disputes; Governing Law
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(a) The Executive, Radica and Radica USA irrevocably submit to the
exclusive jurisdiction of any state or federal court located in the State of
Texas over any controversy or claim between the Executive and Radica and Radica
USA arising out of or relating to or concerning this Agreement. Executive,
Radica and Radica USA (i) acknowledge that the forum stated in this Section 6(a)
has a reasonable relation to this Agreement and to the relationship between the
Executive, Radica and Radica USA and that the submission to the forum will apply
even if the forum chooses to apply non-forum law, (ii) waive, to the extent
permitted by law, any objection to personal jurisdiction or to the laying of
venue of any action or proceeding in the forum stated in this Section 6(a),
(iii) agree not to commence any such action or proceeding in any forum other
than the one stated in this Section 6(a) and (iv) agree that, to the extent
permitted by law, a final and non-appealable judgment in any such action or
proceeding in any such court will be conclusive and binding on the Executive,
Radica and Radica USA. However, nothing in this Agreement precludes the
Executive or Radica or Radica USA from bringing any action or proceeding in any
court for the purposes of enforcing the provisions of this Section 6(a).
(b) To the extent permitted by law, the Executive, Radica and Radica
USA waive any and all rights to a jury trial.
(c) Executive acknowledges that Radica and Radica USA would be harmed
by a breach of Section 3 hereof and that, in addition to any other remedy,
Radica shall be entitled to injunctive relief.
(d) This Agreement shall be governed by the laws of the State of Texas.
7. Survival.
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Any termination of the Executive's employment shall have no effect on
the continuing operation of this Agreement.
8. Notices.
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For purposes of this Agreement, all notices and other communications
required or permitted hereunder shall be in writing and shall be deemed to have
been duly given when delivered or five (5) days after deposit in the United
States mail, certified and return receipt requested, postage prepaid, to such
address as either party may have furnished to the other in writing in accordance
herewith, except that notices of change of address shall be effective only upon
receipt.
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9. Waiver.
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If either party should waive any breach of any provisions of this
Agreement, he or it shall not thereby be deemed to have waived any preceding or
succeeding breach of the same or any other provision of this Agreement.
10. Assignment.
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This Agreement and any rights or obligations hereunder may be assigned
by Radica and Radica USA to any successor in interest to Radica's and Radica
USA's business. This Agreement may not be assigned by Executive.
11. Headings.
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The headings of the sections hereof are inserted for convenience only
and shall not be deemed to constitute a part hereof nor to affect the meaning
thereof.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
date first above written.
RADICA Executive
By: /s/ Xxx X. Xxxxxxxx By: /s/ Xxxxxxx X. Xxxxx
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RADICA USA
By: /s/ Xxx X. Xxxxxxxx
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