KEY EMPLOYEE AGREEMENT

This Key Employee Agreement (“ Agreement ”) is entered into as of the 16th day of July, 2009, by and between James Crawford (“ Executive ”) and PokerTek, inc. (the “ Company ”).

Executive and the Company desire to execute and enter into this Agreement setting forth the terms and conditions of Executive’s employment.

Accordingly, in consideration of the mutual promises and covenants contained herein, the parties agree to the following:

1. Employment by the Company.

1.1 Effective Date. The effective date of this Agreement shall be July 1, 2009. Unless terminated sooner pursuant to Section 6, this Agreement shall end two (2) years from the effective date.

1.2 Position. Subject to terms set forth herein, the Company agrees to employ Executive in the position of President and Secretary, and Executive hereby accepts such employment. During the term of his employment with the Company, Executive will devote his best efforts to the business of the Company.

1.3 Duties. Executive shall serve in an executive capacity and shall perform such duties as are customarily associated with his then current title and as assigned to the Executive by the Company’s Board of Directors.

1.4 Other Employment Policies. The employment relationship between the parties shall also be governed by the general employment policies and practices of the Company, including those relating to protection of confidential information and assignment of inventions, except that when the terms of this Agreement differ from or are in conflict with the Company’s general employment policies or practices, this Agreement shall control.

2. Compensation.

2.1 Salary.

(a) Executive shall receive for services an annualized base salary of $160,000 per annum (the “ Base Salary ”), subject to standard federal and state withholding requirements, payable in accordance with the Company’s standard payroll practices.

(b) The Company may reduce the amount of the Base Salary in connection with a general reduction of salary applicable to all employees of the Company that has been approved by the Company’s Board of Directors (“ General Reduction ”); provided , however , that (i) in no case shall the Base Salary be reduced in a single General Reduction or series of General Reductions by more than an aggregate of twenty percent (20%) of the Base Salary; (ii) in no case shall the Base Salary be reduced for more than six months; and (iii) any and all severance payments made to Executive in accordance with Sections 6 shall be based on the Executive’s original Base Salary without giving effect to any General Reductions.

   (c) Executive will be provided a stock grant of 137,500 options as soon as practicable upon execution of this agreement at Fair Market Value determined by the closing price on the date of grant, which shall vest semi-annually over a three year period. In the event Executive’s employment is terminated by the Company for any reason except Cause, all stock options granted to Executive through the date of termination, will vest immediately and the Executive will have one year from date of termination to exercise his options, provided that Executive executes the Release (as defined below).

2.2 Company Benefits. Executive shall be entitled to all rights and benefits for which he is eligible under the terms and conditions of the standard Company benefits and compensation practices which may be in effect from time to time and provided by the Company to its senior officers generally. Executive shall be entitled to all holidays provided by the Company to its senior officers generally and three weeks (3) vacation time provided by the Company to its senior officers generally. For purposes of this Section, “provided by the Company to its senior officers generally” shall mean benefits provided as a policy to all or most members of senior management and shall not include a specific benefit negotiated by one or more executives as an inducement to join the Company in a senior officer position.

2.3 Expense Reimbursement . The Company will reimburse Executive for reasonable business expenses in accordance with the Company’s standard reimbursement policy.

3. Proprietary Information, Inventions, and Non-Competition Obligations.

3.1 Agreement. Executive agrees to execute and abide by the Proprietary Information, Inventions, Non-Competition, and Non-Solicitation Agreement attached hereto as Exhibit A (the “ Proprietary Information Agreement ”).

4. Outside Activities.

4.1 Other Employment/Enterprise. Except with the prior written consent of the Company’s Board of Directors, Executive will not, while employed by the Company, undertake or engage in any other employment, occupation or business enterprise, other than ones in which Executive is a passive investor. Executive may engage in civic and not-for-profit activities so long as such activities do not materially interfere with the performance of his duties hereunder.

4.2 Conflicting Interests. Except as permitted by Section 4.3, while employed by the Company, Executive agrees not to acquire, assume or participate in, directly or indirectly, any position, investment or interest known by him to be adverse or antagonistic to the Company, its business or prospects, financial or otherwise.

4.3 Competing Enterprises. While employed by the Company, except on behalf of the Company, Executive will not directly or indirectly, whether as an employee, officer, director, stockholder, partner, proprietor, associate, representative, consultant, or in any capacity whatsoever engage in, become financially interested in, be employed by or have any business connection with any other person, corporation, firm, partnership or other entity whatsoever which compete directly with the Company, throughout the world, in any line of business engaged in (or planned to be engaged in) by the Company; provided, however, that anything above to the contrary notwithstanding, he may own, as a passive investor, securities of any public competitor corporation, so long as his direct holdings in any one such corporation shall not in the aggregate constitute more than 1% of the voting stock of such corporation.

5. Former Employment.

5.1 No Conflict with Existing Obligations. Executive represents that his performance of all the terms of this Agreement and as an employee of the Company does not and will not breach any agreement or obligation of any kind made prior to his employment by the Company, including agreements or obligations he may have with prior employers or entities for which he has provided services. Executive has not entered into, and agrees he will not enter into, any agreement or obligation either written or oral in conflict herewith.

5.2 No Disclosure of Confidential Information. If, in spite of the second sentence of Section 5.1, Executive should find that confidential information belonging to any former employer might be usable in connection with the Company’s business, Executive will not intentionally disclose to the Company or use on behalf of the Company any confidential information belonging to any of Executive’s former employers (except in accordance with agreements between the Company and any such former employer); but during Executive’s employment by the Company he will use in the performance of his duties all information which is generally known and used by persons with training and experience comparable to his own and all information which is common knowledge in the industry or otherwise legally in the public domain.

6. Termination Of Employment . The parties acknowledge that Executive’s employment with the Company is at-will. The provisions of Sections 6.1 through 6.7 govern the amount of compensation, if any, to be provided to Executive upon termination of employment and do not alter this at-will status.

6.1 Termination without Cause. The Company shall have the right to terminate Executive’s employment with the Company at any time without Cause by giving notice as described in Section 6.7 of this Agreement.

(a) In the event Executive’s employment is terminated by the Company without Cause for a reason other than death, disability or cessation of the Company’s business pursuant to Section 6.6 below, the Company shall continue to pay Executive his then-existing base salary, less applicable withholding and deductions, and continue to provide medical and dental coverage or pay Cobra premiums for twelve (12) months.

(b) In the event the Executive is terminated within one year following a Change in Control of the Company, Executive will receive twelve (12) months of the base salary along with twelve (12) months of medical and dental coverage or Cobra premium payments.

(c) “Change of Control” shall be deemed to have occurred on the earliest of the following dates:

(i) The date any entity or person shall have become the beneficial owner of, or shall have obtained voting control over, fifty percent (50%)   or more of the outstanding Common Stock of the Company;

(ii) The date the shareholders of the Company approve a definitive agreement (X) to merge or consolidate the Company with or into another corporation or other business entity (each, a "corporation"), in which the Company is not the continuing or surviving corporation or pursuant to which any shares of Common Stock of the Company would be converted into cash, securities or other property of another corporation, in each case other than a merger or consolidation of the Company in which the holders of Common Stock immediately prior to the merger or consolidation continue to own immediately after the merger or consolidation at least fifty percent 50%   of Common Stock, or, if the Company is not the surviving corporation, the common stock (or other voting securities) of the surviving corporation; provided, however, that if consummation of such merger or consolidation is subject to the approval of federal, state or other regulatory a