SEVERANCE AGREEMENT AND GENERAL RELEASE OF ALL CLAIMS

Exhibit 10.2

SEVERANCE AGREEMENT

AND

GENERAL RELEASE OF ALL CLAIMS

This Severance Agreement and General Release of all Claims (“Agreement”) is made by and between Stanley Kinsey (hereinafter “EMPLOYEE”), and NTN Communications, Inc. (“EMPLOYER”).

RECITALS

A. EMPLOYEE was employed by EMPLOYER from November, 1997 through July 7, 2006, the date such employment was terminated (the “Effective Date”).

B. From time to time during his employment, EMPLOYER has granted to EMPLOYEE various stock options to purchase shares of EMPLOYER’s common stock (“Common Stock”), which options were issued pursuant to EMPLOYER’S 1995 Stock Option Plan (“1995 Plan”) and 2005 Performance Incentive Plan (“2005 Plan”; the 1995 Plan and the 2005 Plan are sometimes collectively referred to herein as the “Plans”).

C. Since July 1, 2005, the terms of EMPLOYEE’s employment by EMPLOYER has been as set forth in that certain Employment Agreement dated June 28, 2005 by and between EMPLOYEE and EMPLOYER (“Employment Agreement”).

D. Pursuant to the Employment Agreement and the Plans, EMPLOYEE is entitled to payment of certain amounts and certain rights with respect to such stock options following termination of his employment.

E. The parties wish to fully and finally settle all matters between them and, accordingly hereby enter into this Agreement.

NOW, THEREFORE, in consideration of the promises and mutual agreements hereinafter set forth, it is hereby agreed by and among the parties as follows:

1. PAYMENT

a. Final Wages . On the Effective Date, EMPLOYER agrees to pay EMPLOYEE all normal payroll amounts owing to him through and including that date, plus all accrued and unused vacation pay benefits. In addition, on or before the Effective Date, EMPLOYER agrees to pay EMPLOYEE his share of the 2005 Executive Bonus Pool, which the parties currently estimate to be approximately Five Thousand to Fifteen Thousand Dollars. In the event the Board does not approve the entire bonus payment, EMPLOYEE shall be entitled to receive a pro rata portion of any bonus paid to the senior management team at a ratio equal to the plan’s original percentages. In addition, at any time and from time to time following the Effective Date, in order to validate the calculations relating to his share of the 2005 Executive Bonus Pool, EMPLOYEE will have the right to audit EMPLOYER’S internal financial reports, at EMPLOYEE’S sole expense, provided EMPLOYEE provides reasonable advance notice and any such audit

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will be conducted at EMPLOYER’S place of business and during normal business hours.

b. Severance Wages . EMPLOYER agrees to pay EMPLOYEE the following as severance wages:

(1) The total sum of Three Hundred Ninety Four Thousand Dollars ($394,000.00); such payment will be made in accordance with EMPLOYER’s normal payroll practices (less payroll withholdings for taxes and other amounts in accordance with federal and state law) payable in 26 equal biweekly increments of $15,153.85 each, commencing on the first pay date immediately subsequent to the eighth (8th) day after EMPLOYEE’S execution of this Agreement with the first payment retroactive to the Effective Date, and continuing each consecutive pay date until such sum is paid in full.

c. Other Severance Benefits . In addition to the foregoing, and the benefits described in subpart d. below, EMPLOYER shall pay, at its sole expense and at no cost to EMPLOYEE, and continue each of the following benefits in full force and effect for the twelve (12) month period immediately following the Effective Date:

(1) COBRA medical and dental premiums for EMPLOYEE and dependent coverage;

(2) Major medical insurance premiums with an annual cumulative deductible amount of no more than $500 for EMPLOYEE, his wife, if any, and those or his children who qualify as his dependents under Section 152 of the Internal Revenue code of 1954, and

(3) Term life insurance on EMPLOYEE’s life, payable to his designated beneficiary, in the amount of $1,000,000, and, in the event of accidental death or dismemberment, in the amount of $2,000,000; the premium relating to such coverage shall not exceed $4,000 per year.

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d. Stock Options . Further, EMPLOYER hereby certifies as being granted to, fully vested in and exercisable by, EMPLOYEE, with Exercise Periods following EMPLOYEE’s termination of employment for each as noted below, the stock option grants to purchase shares of EMPLOYER’s common stock (“Common Stock”) set forth in Table 1.A. below, which grants were made pursuant to the Plans:

Table 1. A.

The following terms shall apply to such stock options in addition to the terms set forth in the Plans and the documents delivered pursuant thereto:

(1) Accelerated Vesting . EMPLOYEE shall be entitled to accelerated vesting in full of Stock Option Grant I, as set forth in Table 1.A. above.

(2) Cashless Exercise . In accordance with the authority vested in the Compensation Committee of the Board as Administrator of the Company’s stock option plans, the EMPLOYEE is granted both (a) the use of a cashless exercise program for any and all options , and (b) the use of Common Stock, acquired through DSU’s or the cashless exercise of stock options, to pay to the Company any required withholding taxes that the Company is required to withhold.

Several forms of cashless exercise are allowed by the Plans with approval of the Administrator: accordingly, EMPLOYER hereby grants EMPLOYEE the right to use any form of cashless exercise permitted under applicable law that generally follows the economic model in the following example:

In lieu of EMPLOYEE making a cash payment for any Common Stock he may purchase upon exercise of any of the above Options, EMPLOYEE may, in his sole discretion, elect to convert all or any portion of any of such Options to shares of Common Stock of EMPLOYER by the surrender of the particular Option or portion thereof in accordance with the provisions of the Plans, in exchange for a number of shares of Common Stock EMPLOYER determined in accordance with the following formula:

X = Y times (A minus B)

                              A

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where X = the number of shares of Common Stock of EMPLOYER to be issued to EMPLOYEE pursuant to this Section 1

Y = the number of shares of Common Stock of EMPLOYER that could be acquired upon a cash exercise of the portion of the Option being surrendered (as adjusted to the date of calculation)

A = the closing sale price of one share of Common Stock of EMPLOYER as of the end of the day immediately preceding the date of exercise

B = the then exercise price of one share of Common Stock per the above TABLE1.A.

For example, if the EMPLOYEE requests to exercise 100,000 options with an exercise price of $1.00 and a closing sale price on the day immediately preceding the date of exercise of $2.00, then the EMPLOYER would deliver to the EMPLOYEE 50,000 registered shares of Common Stock upon the surrender of the 100,000 stock options.

In addition, EMPLOYEE may also elect to have EMPLOYER withhold from the number of shares of Common Stock that would otherwise be delivered to the EMPLOYEE by the EMPLOYER on exercise of the option, a number of shares of Common Stock equal in value to the aggregate withholding taxes applicable to such exercise.

By entering into this Agreement, EMPLOYER agrees that neither it, the Plan Committee nor the Plan Administrator may modify or terminate the terms of EMPLOYEE’S cashless exercise, or other rights with respect to the stock options set forth herein, unless expressly required to do so by applicable law.

(3) Company Responsiveness to Option Exercise Request . As long as EMPLOYEE’S broker initiates an exercise request according to electronic DWAC system requirements, the EMPLOYER will act on such request as if signed by the EMPLOYEE and electronically deliver to the EMPLOYEE the required number of shares of Common Stock of the Company, either by standard exercise or cashless exercise, as the case may be, within 24 hours of each such request.

(4) Transferability of Options . Without limiting the applicability of any other provisions under the Plans, EMPLOYER confirms EMPLOYEE’S right to transfer the options, in the manner permitted under Section 2.4 of the 1995 Plan.

e. Outplacement Services . EMPLOYEE to receive $5,000 for reimbursement of standard senior executive outplacement service package or fees incurred in termination discussions.

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2 GENERAL RELEASE .

a. Release . In exchange for the foregoing consideration, EMPLOYEE a