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Exhibit 2.1
CONSULTING, TRANSITION
AND RELEASE AGREEMENT
This Consulting, Transition
and Release Agreement (hereinafter “Agreement”) is made
and entered into by and between Michele Richards (hereinafter
“Richards”) and NTN Buzztime, Inc. (hereinafter
“NTN Buzztime”), and inures to the benefit of each of
NTN Buzztime’s current, former and future parents,
subsidiaries, related entities, employee benefit plans and their
fiduciaries, predecessors, successors, officers, directors,
shareholders, agents, insurers, employees and assigns, each of whom
are to be considered principals, or, in the alternative, intended
third party beneficiaries of this Agreement.
RECITALS
Richards and NTN Buzztime NTN
have determined that it is in their mutual best interest for
Richards to voluntarily resign her current position and regular
full-time employment with NTN Buzztime effective February 1,
2008. However, NTN Buzztime wants to continue to use
Richards’ services as a consultant during what it expects to
be a transitional period for portions of the company’s
business and generally similar to Richards’ former
responsibilities with NTN Buzztime, and Richards agrees to such a
relationship.
NTN Buzztime and Richards
therefore desire to completely, permanently resolve any and all
disputes, claims and issues arising out of Richards’
employment with NTN Buzztime and the termination of that
employment, as well as any and all other disputes, claims and
issues that exist or may exist at this time.
AGREEMENT
Based on the foregoing facts
and in consideration of the execution of this Agreement, the mutual
covenants and promises contained in the following paragraphs and
for other good and valuable consideration, NTN Buzztime and
Richards agree as follows:
1. Effective Date and
Term of Agreement . This Agreement and the consulting
relationship provided in the Agreement shall be effective on the
eighth day after Richards executes the Agreement provided that she
does not revoke it as provided in Paragraph 12(e) (“Effective
Date”). The maximum term of the Agreement and consulting
relationship is intended to be the six (6) months. However,
the Agreement is subject to earlier termination in accordance with
Paragraphs 11(a)-(e).
2. Consulting Duties
and Responsibilities . Richards agrees to perform the
consulting services specified in Exhibit A to this Agreement as
well as any other related consulting services that NTN Buzztime may
request.
3. Compensation
. In exchange for the consulting work that Richards will provide to
NTN Buzztime and other consideration provided herein, NTN Buzztime
will provide Richards with the following compensation:
a. Consulting Fees .
NTN Buzztime will pay Richards a monthly consulting fee
(“Consulting Fee”) from the Effective Date of the
Agreement until the Agreement terminates in accordance with
Paragraphs 11(a)-(e). The Consulting Fee will be $18,333 per month
and will be payable semi-monthly. Payments will be made on the 15th
of each month or the next business day if the 15th falls on a
weekend or holiday and on the last business day of each month for
services provided in that month. The initial anticipated time
commitment would be thirty (30) hours per week for the first
sixty (60) days in the NTN Buzztime headquarters office.
Subsequent time commitment would adjust to twenty (20) hours
per week in the office for the remainder of the Term. Richards must
submit semi-monthly invoices to NTN Buzztime on the first business
day after the 15th day of each month and the last business day of
the month showing her hours worked. The Consulting Fee will be
prorated for any month in which the consulting services are
provided for only a partial month. The right to Consulting Fees
terminates when the Agreement terminates in accordance with
Paragraphs 11(a)-(e) except as expressly provided in Paragraph
3(b).
b. Payment for Early
Termination of Agreement by NTN Buzztime . Should NTN Buzztime
terminate the Agreement pursuant to Paragraph 11(a), it will pay
Richards a lump sum equal to what the Consulting Fees would be for
the portion that remains of the six month period following the
Effective Date of the Agreement as of the termination. This payment
is referred to herein at the “Early Termination
Payment” and will never exceed a maximum of six months of
Consulting Fees. Richards will not be entitled to the Early
Termination Payment if she chooses to terminate the
Agreement before the six-month term pursuant to Paragraph 11(a) or
if the Agreement terminates under Paragraphs 11(b)-(e).
c. Outplacement
Services . NTN Buzztime shall provide Richards with
outplacement services for three months from the Effective Date of
the Agreement unless Richards terminates the Agreement earlier in
accordance with Paragraph 11(a) or the Agreement terminated
pursuant to Paragraphs 11(b)-(e), in which case the outplacement
benefits will also terminate. Richards may access the outplacement
benefits by contacting the representative listed in the information
packet.
d. Minimum Consulting
Commitment . Richards agrees to work for no less than sixty
(60) days from the Effective Date of this
Agreement.
e. Taxes . Because
Richards is not an employee of NTN Buzztime, Richards is solely
responsible for paying all required state and federal taxes. NTN
Buzztime will not withhold FICA (Social Security), will not make
State Disability Insurance contributions, will not make state or
federal unemployment insurance contributions on behalf of Richards
and will not withhold state or federal income tax. NTN Buzztime
shall issue Form 1099s to Richards for the Consulting Fees and, if
applicable, for the Early Termination Payment.
f. Expenses Subject to
Reimbursement . Richards will be responsible for all costs and
expenses incidental to the performance of consulting services for
NTN Buzztime.
g. Independent Contractor
Status . It is the express intention of the parties that
Richards is an independent contractor and not an employee, agent,
joint venturer or partner of NTN Buzztime. Nothing in this
Agreement shall be interpreted or construed as creating or
establishing an employment relationship between Richards and NTN
Buzztime.
h. No Employment
Benefits . Richards acknowledges and agrees that NTN Buzztime
is under no obligation to provide and shall not provide her with
any with any medical, dental, vision, life insurance, disability
insurance or retirement benefits or any other type or form of
employment benefits.
i. Entitlement to
Consideration . By signing this Agreement, Richards
acknowledges that she would not be entitled to the consideration
provided in Paragraphs 3(a)-(d) were it not for her execution
of this Agreement.
4. Supplemental
Consideration and Supplemental Release Agreement
.
a. Within thirty
(30) calendar days following the termination of this Agreement
pursuant to Paragraph 11(a) or Paragraph 11(b), Richards shall
execute and provide to NTN Buzztime the Supplemental Agreement
attached hereto as Exhibit B by mailing it or otherwise delivering
it to: Shannon Kehle, NTN Buzztime, Inc., 5966 La Place Court,
Suite 100, Carlsbad, CA 92008.
b. Within fifteen
(15) calendar days of NTN Buzztime’s receipt of the
Supplemental Release Agreement executed by Richards, NTN Buzztime
shall provide an additional lump sum payment to Richards in the
gross amount of Eight Thousand Dollars and Zero Cents ($8,000.00)
(“Supplemental Compensation”). By signing this
Agreement, Richards acknowledges that she would not and will not be
entitled to the Supplemental Compensation unless she signs the
Supplemental Agreement
c. The Supplemental
Compensation shall not be subject to any withholdings or deductions
by NTN Buzztime. NTN Buzztime shall issue to Richards a Form 1099
for the amount of the Supplemental Compensation.
d. If Richards does not
execute the Supplemental Agreement as provided herein, or if this
Agreement is terminated pursuant to Paragraphs 11(c)-(e), then NTN
Buzztime will have no obligation to provide the Supplemental
Compensation to Richards.
5. Acknowledgment of
Compensation Received . Richards represents and
acknowledges that, prior to the date of her execution of this
Agreement, she has received from NTN Buzztime any and all wages,
benefits and other compensation due and owing to her as a result of
her employment with NTN Buzztime, including without limitation any
and all accrued but unused vacation time. Richards further agrees
that as of her separation of employment from NTN Buzztime, the only
claim for monies owed to her by NTN Buzztime would be as set forth
in this Agreement.
6. Exercise of Vested
Stock Options . Richards acknowledges and agrees that any
stock option benefits she is entitled to and any rights she may
have to exercise vested stock options are governed by the 2004
Performance Incentive Plan and previous Stock Option Plans which
stock options have been granted under prior to 2004.
7. Tax Liability and
Representations. Richards agrees that NTN Buzztime has made
no representations to her regarding the tax consequences of the
Consulting Fees and/or the Supplemental Compensation and that she
has not relied upon any such representations in entering into this
Agreement. Richards agrees to pay all federal or state taxes, if
any, which are required by law to
be paid with respect to the Consulting
Fees and/or Supplemental Compensation. Richards further agrees to
indemnify and hold NTN Buzztime, its predecessors, and its current
and former officers, directors, employees, attorneys,
representatives, successors and assigns harmless from any claims,
demands, deficiencies, levies, assessments, executions, judgments
or recoveries by any governmental entity against NTN Buzztime, or
any of the foregoing persons or entities, for any
amounts
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