Exhibit 4.16(a)
AMENDMENT NO. 2
TO EMPLOYMENT AGREEMENT
AGREEMENT, dated as of January 31, 2005, by and between Radica Enterprises,
Ltd., a Nevada corporation ("Radica USA"), Radica Games Limited, a Bermuda
company ("Radica"), and Xxxxxxx Xxxxx ("Employee").
WHEREAS, Radica, Radica USA and Employee entered into an amended and restated
employment agreement, dated as of September 2000 (the "Employment Agreement"),
with respect to the employment by Radica and Radica USA of Employee;
WHEREAS, Radica, Radica USA and Employee entered into Amendment No. 1, dated as
of March 31, 2003 ("Amendment No. 1"), to the above-mentioned Employment
Agreement; and
WHEREAS, the parties desire to further amend the Employment Agreement
(hereinafter, references to the Employment Agreement shall include the changes
made to such Agreement by Amendment No. 1) with respect to Employee's continued
employment after the date of this Amendment No. 2.
NOW, THEREFORE, it is hereby agreed as follows:
1. Section 1(a) of the Employment Agreement is hereby amended in its
entirety to read as follows:
(a) "Cause" means:
(i) material breach by Employee of a fiduciary obligation to any
member of Radica Group;
(ii) intentional 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 material adverse
consequences to any member of Radica Group;
(iii) material 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 after notification
of same, 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 or
Radica USA (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.
2. Section 1(f) of the Employment Agreement is hereby amended in its
entirety to read as follows:
(f) "1994 Plan" means the 1994 stock option plan
adopted by Radica, as amended from time to time, and
"Omnibus Plan" means the 2004 omnibus equity
incentive plan adopted by Radica, as amended from
time to time. Any reference in this Employment
Agreement to either the 1994 Plan or the Omnibus
Plan shall include both of such plans and shall give
effect to the plan or plans that are applicable to
the stock options or other incentives granted by
Radica to Employee.
3. Section 3(c) of the Employment Agreement is hereby amended in its
entirety to read as follows:
On termination of this Agreement pursuant to
Paragraph (a) above, or by Radica or Radica USA for
Cause, or by Employee without consent of Radica or
Radica USA, all benefits and compensation shall
cease as of the date of such Termination. On
termination of this Agreement by Radica or Radica
USA without Cause or by Employee for Good Reason in
the event of a Termination/Change in Control or in
the event of Total Disability of Employee, (i)
Radica USA will continue to pay Employee his annual
salary for twelve months from the date of
Termination, (ii) Radica Group will continue to
provide medical and dental benefits to Employee for
twelve months from the date of Termination on the
same basis and at the same Employee cost as at the
date of Termination and (iii) Employee's stock
options, restricted stock, and restricted stock
units will be treated as set forth in Section 6
hereof.
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4. The lead-in paragraph to Section 6(c) of the Employment Agreement is
hereby amended in its entirety to read as follows (but the subparagraphs in
capital letters that immediately follow that lead-in paragraph shall not be
amended hereby):
As of the date of Termination in the event of
Termination pursuant to Section 3(a) or Termination
by Radica or Radica USA for Cause or by Employee
without consent of Radica or Radica USA, or (ii)
twelve (12) months after the date of Termination in
the event of Termination by Radica or Radica USA
without Cause or by Employee for Good Reason in the
event of a Termination/Change in Control (unless
Section 6(f) of this Agreement applies, in which
case this Section 6(c) shall not apply to Employee's
Stock Options, restricted stock and restricted stock
units) 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:
5. Sections 6(d), (e) and (f) of the Employment Agreement are hereby
amended in their entirety to read as follows:
(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. Restricted Stock, and
restricted stock units, if not forfeited, shall be
deliverable to Employee upon its applicable vesting
date, free of the previously existing restrictions,
but subject to applicable state and federal
securities laws.
(e) Employee shall have no right to sell, alienate,
mortgage, pledge, gift or otherwise transfer the
Stock Options, the Restricted Stock or any
restricted stock units or any rights thereto, except
by will or by the laws of descent and distribution,
and except pursuant to applicable state and federal
securities laws and except as specifically
contemplated herein.
(f) Upon the occurrence of a Change in Control under
the Omnibus Plan, all of Employee's then outstanding
stock options, restricted stock, and restricted
stock units in Radica shall vest and become
immediately exercisable. If Employee is terminated
by Radica or Radica USA without Cause after a
definitive agreement for a transaction that would
constitute a Change in Control as described in the
Omnibus Plan has been approved by the
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shareholders of Radica, but before such transaction
is consummated, Employee's stock options restricted
stock, and restricted stock units in Radica shall
vest on the date of such termination without Cause.
Income realized by Employee as a result of the
acceleration of vesting of equity compensation or
otherwise resulting from a Termination/Change in
Control is specifically paid in consideration of
post-employment restrictions of Section 7 hereunder.
6. Section 13 of the Employment Agreement is hereby amended in its
entirety to read as follows:
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. Each party
agrees to make any modifications to this Agreement,
including changing the timing of payments hereunder,
as may be reasonably necessary to comply with
Section 409A of the Internal Revenue Code.
7. Section 16 of the Employment Agreement is hereby amended in its
entirety to read as follows:
REIMBURSEMENT OF EXPENSES. After a Change in Control
or a Termination for Cause later determined to be a
Termination Without Cause, if any dispute shall
arise under this Agreement involving termination of
Employee's employment with Radica or Radica USA or
involving the failure or refusal of Radica or Radica
USA to perform fully in accordance with the terms
hereof, Radica or Radica USA shall reimburse
Employee, on a current basis, for all reasonable
legal fees and expenses, if any, incurred by
Employee in connection with such contest or dispute
(regardless of the result thereof), regardless of
whether Employee's claim is upheld by a court of
competent jurisdiction; provided, however, Employee
shall be required to repay any such amounts to
Radica or Radica USA to the extent that a court
issues a final and non-appealable order setting
forth the determination that the position taken by
Employee was frivolous or advanced by Employee in
bad faith.
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IN WITNESS WHEREOF, the parties have executed this Amendment No. 2 as
of the date and year first above written.
RADICA ENTERPRISES, LTD.
By /s/ Xxx X. Xxxxxxxx
-------------------------------------
Name: Xxx X. Xxxxxxxx
Title: Chairman--Radica Games Limited
RADICA GAMES LIMITED
By /s/ Xxx X. Xxxxxxxx
-------------------------------------
Name: Xxx X. Xxxxxxxx
Title: Chairman
/s/ Xxxxxxx Xxxxx
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XXXXXXX XXXXX
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