Employment Agreement



 Exhibit 10.1 
 EMPLOYMENT AGREEMENT 
 This EMPLOYMENT AGREEMENT, dated June 28, 2005, is entered into by and between NTN
COMMUNICATIONS, INC., a Delaware corporation (the “Company”), and Stanley B. Kinsey (the “Executive”). 
  

	 	1.	Term of Employment 

 Subject to the provisions of
Section 10 below, the Company shall employ the Executive, and the Executive shall serve the Company in the capacity of Chief Executive Officer for a term of eight months commencing as of July 1, 2005, and ending February 28, 2006 (the
“Term of Employment”). 
  

	 	2.	Duties 

 During the Term of Employment, the
Executive will serve as the Company’s Chief Executive Officer and will report directly to the Board of Directors. Executive will serve the Company faithfully, diligently, and competently and to the best of his ability. During the Term of
Employment under this Agreement, the Executive shall also serve as a member of the Company’s Board of Directors. 
  

	 	3.	Compensation 

 During the Term of Employment, the
Company shall pay to the Executive as compensation for the performance of his duties and obligations hereunder a salary at the rate of $394,000 per annum through February 28, 2006. Such salary shall be paid bi-weekly. In addition, the Executive
will be included in the Company executive bonus pool in a manner consistent with the 2004 executive bonus program. 
  

	 	4.	Expenses and Other Benefits. 

 All travel,
entertainment and other reasonable business expenses incident to the rendering of services by the Executive hereunder will be promptly paid or reimbursed by the Company subject to submission by the Executive in accordance with the Company’s
policies in effect from time to time. 









 The Executive shall be entitled during the Term of Employment to participate in employee benefit and
welfare plans and programs of the Company including any employee incentive stock option plans, qualified or unqualified, to the extent that any other executives or officers of the Company or its subsidiaries are eligible to participate and subject
to the provisions, rules, regulations, and laws applicable thereto. Notwithstanding the foregoing, the Company shall provide the Executive, at a minimum, with the following benefits: 
 (a) Coverage, at no expense to the Executive, of the Executive, his wife, if any, and those of his children who qualify as his dependents
under Section 152 of the Internal Revenue code of 1954, under a major medical insurance program with an annual cumulative deductible amount of no more than $500; 
 (b) Coverage of the Executive by term life insurance, 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. Coverage shall begin the first day of the Term of Employment hereunder and shall continue throughout the
Term of Employment; and 
 (c) A paid vacation of five (5) weeks, in addition to any authorized holidays of the Company,
during the Term of Employment. 
 (d) Incentive Stock Option Compensation - The Company will grant the Executive 250,000
Incentive Stock Options (ISO’s) at a price of $1.88 per share. The ISOs shall vest ratably over the 12 months beginning July 1, 2005. The form of such share grant is attached hereto as Exhibit “A.” Notwithstanding anything to the
contrary contained in the options, all of the Executive’s options will immediately vest upon a “Change of Control Event,” as defined in Section 10 hereof. 
  

	 	5.	Death or Disability 

 This Agreement shall be
terminated by the death of the Executive and also may be terminated by the Board of Directors of the Company if the Executive shall be rendered incapable by illness or any physical or mental disability (individually, a “disability”) from
substantially complying with the terms, conditions and provisions to be observed and performed on his part for a period in excess of six months (whether or not consecutive) during any 12 months during the Term of Employment. If this Agreement is to
be terminated by reason of illness, or any physical or mental disability of the Executive, the Company shall give thirty days’ written notice to that effect to the Executive in the manner provided herein and the Executive shall be entitled to
the greater of: i) one year’s additional compensation; or ii) the compensation that was to accrue during the balance of the Term of Employment; and, in each case, including those benefits described in Sections 4(a), (b), (c) and
(d) hereof. 
  

	 	6.	Disclosure of Information; Inventions and Discoveries 

 Except as provided in the California Labor Code, the Executive shall promptly disclose to the Company all processes, trademarks, inventions, improvements, discoveries and other information (collectively, “developments”) directly
related to the business of the Company conceived, developed or acquired by him alone or with others during the Term of Employment by the Company, whether or not during regular working hours or through the use of material or facilities of the
Company. For the purpose of Sections 6, 7 and 8 hereof, the business of the Company includes without limitation the fields of electronically simulated sports games or interactive television applications. All such developments shall be the sole and
exclusive property of the Company, and upon request the Executive shall deliver to the Company all drawings, sketches, models and other data and records relating to such development. In the 

  

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event any such development shall be deemed by the Company to be patentable, the Executive shall, at the expense of the Company, assist the Company in
obtaining a patent or patents thereon and execute all documents and do all other things necessary or proper to obtain letters patent and invest the Company with full title thereto. 
  

	 	7.	Non-Competition 

 The Company and the Executive
agree that the services rendered by the Executive hereunder are unique and irreplaceable. During his employment by the Company and to the extent permitted by law, for a period of one year thereafter, the Executive shall not become an executive
officer (other than an officer whose function substantially relates to financial matters) of any business in the fields of electronically simulated sports games or interactive television, which in the judgment of the Company is, or as a result of
the Executive’s engagement or participation would become, directly competitive with any aspect of the business of the Company. 
  

	 	8.	Non-Disclosure 

 The Executive will not at any time
after the date of this Employment Agreement divulge, furnish or make accessible to anyone (otherwise than in the regular course of business of the Company) any knowledge or information with respect to confidential or secret processes, inventions,
discoveries, improvements, formulas, plans, material, devices, ideas or other know-how, whether patentable or not, with respect to any confidential or secret engineering, development or research work or with respect to any other confidential or
secret aspect of the business of the Company (including, without limitation, customer lists, supplier lists and pricing arrangements with customers or suppliers), except to the extent such disclosure is (a) in the performance of his duties
under this Agreement, (b) required by applicable law, (c) lawfully obtainable from other sources, (d) authorized in writing by the Company, or (e) when required to do so by legal process, that requires him to divulge, disclose or
make accessible such information. 
  

	 	9.	Remedies 

 The Company may pursue any appropriate
legal, equitable or other remedy, including injunctive relief, in respect of any failure by the Executive to comply with the provisions of Sections 6, 7 or 8 hereof, it being acknowledged by the Executive that the remedy at law for any such failure
would be inadequate. If the Company shall have failed to cure any material breach by the Company of any material provision of this Agreement within 30 days after notice by the Executive to the Company specifying such breach with particularity, the
Executive may, in addition to other remedies, give notice to the Company of acceleration of the entire amount of compensation which was to accrue to the Executive during the balance of the Term of Employment, and such amount shall be immediately due
and payable to the Executive. 
  

	 	10.	Termination 

 The Executive’s employment with
the Company may be terminated by the Board of Directors of the Company (i) upon three (3) days’ notice to the Executive in the event of the Executive’s personal dishonesty, willful misconduct or breach of fiduciary duty or
(ii) upon 

  

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thirty (30) days’ notice to the Executive if the Executive shall be in material breach of any material provision of this Employment Agreement other
than as provided in clause (i) above and shall have failed to cure such breach during such thirty day period. Any such notice to the Executive shall specify with particularity the reason for termination or proposed termination. 
 In the event of termination under this Section 10 or under Section 5 (except as provided therein), the Company’s unaccrued obligations
under this Agreement shall cease and the Executive shall forfeit all right to receive any unaccrued compensation or benefits hereunder but shall have the right to reimbursement of expenses already incurred. Notwithstanding any termination of the
Agreement pursuant to this Section 10 or by reason of disability under Section 5, the Executive, in consideration of his employment hereunder to the date of such termination, shall remain bound by the provisions of Sections 6, 7 and 8
(unless this Agreement is terminated on account of the breach hereof by the Company) of this Agreement except that if this Agreement is terminated following a Change in Control Event (as defined below) then the Executive shall remain bound only by
the provisions of Sections 6 and 8. 
 Termination without cause or any attempt by the Board of Directors of the Company to reassume any of
the responsibilities or duties from the Executive or to change the duties of the Executive without cause shall be deemed a breach of this Agreement by the Company without cause and shall immediately entitle the Executive, as liquidated damages
therefore, to the greater of: i) one year’s additional compensation; or ii) the compensation that was to accrue during the balance of the Term of Employment; and, in each case, including those benefits described in Sections 4(a), (b),
(c) and (d) hereof. 
 Notwithstanding anything to the contrary contained herein, the Executive or the Company shall have the
option to terminate this Agreement at any time following a “Change in Control Event.” In the event of such termination either by the Company or by the Executive following a Change in Control Event, the company shall immediately entitle the
Executive, as liquidated damages therefore, to one year’s additional compensation, including those benefits described in Sections 4(a), (b), (c) and (d) hereof. A “Change in Control Event” shall mean: 
 (a) The acquisition by any individual entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”) (a “Person”) of beneficial ownership of 50% or more of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the
“Outstanding Voting Securities”) or any approval of such acquisition by the Board of Directors of the Company, provided that such acquisition is accomplished within six months of such approval; provided, however, that the following
acquisitions shall not constitute a Change in Control Event: (A) any acquisition by the Company or (B) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by
the Company. 
 (b) Individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease for
any reason to constitute at least a majority of the Board; provided, however, that any individual who becomes a director subsequent to the date hereof whose election, or nomination for election by the Company’s shareholders, was approved by a
vote of at least a majority of the directors then comprising the Incumbent Board shall be 

  

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considered as though such individual were a member of the Incumbent Board; but excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on
behalf of a Person other than the Board; or 
 (c) Approval by the shareholders of the Company of a reorganization, merger or
consolidation (a “transaction”), unless, following such transaction in each case, more than 50% of, respectively, the then outstanding shares of common stock of the Company resulting from such transaction and the combined voting power of
the then outstanding voting securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entitles who were the
beneficial owners, respectively, of the outstanding Common stock and Outstanding Voting Securities immediately prior to such transaction; or 
 (d) Approval by the shareholders of the Company of (A) a complete liquidation or dissolution of the Company or (B) the sale or other disposition of all or substantially all of the assets of the Company
unless such assets are sold to a corporation and following such sale or other disposition, the condition described in paragraph (c) above is satisfied. 
 (e) A non-voluntary removal by the Board of the Executive’s additional position of Chairman of the Board of Directors. 
  

	 	11.	Resignation 

 In the event that the Executive’s
services hereunder are terminated under Section 5 or 10 of this Agreement (except by death), the Executive agrees that he will deliver his written resignation as a Director of the Company to the Board of Directors, such resignation to become
effective immediately. 
 Upon expiration of the Term of Employment or termination pursuant to Section 5 or 10 hereof, the Executive or
his personal representative shall promptly deliver to the Company all books, memoranda, plans, records and written data of every kind relating to the business and affairs of the Company which are then in his possession on account of his employment
hereunder, but excluding all such materials in the Executive’s possession which are personal and not property of the Company or which he holds on account of his past or current status as a director or shareholder of the Company. 
  

	 	12.	Arbitration 

 Any dispute or controversy arising
under this Agreement or relating to its interpretation or the breach hereof, including the arbitrability of any such dispute or controversy, shall be determined and settled by arbitration in San Diego, California pursuant to the Rules then obtaining
of the American Arbitration Association. Any award rendered herein shall be final and binding on each and all of the parties, and judgment may be entered thereon in any court of competent jurisdiction. 
  

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	 	13.	Insurance 

 The Company shall have the right at its
own cost and expense to apply for and to secure in its own name, or otherwise, life, health or accident insurance or any or all of them covering the Executive, and the Executive agrees to submit to any usual and customary medical examination and
otherwise to cooperate with the Company in connection with the procurement of any such insurance, and any claims thereunder. 
  

	 	14.	Waiver of Breach 

 Any waiver of any breach of this
Employment Agreement shall not be construed to be a continuing waiver or consent to any subsequent breach on the part either of the Executive or of the Company. 
  

	 	15.	Assignment 

 Neither party hereto may assign his or
its rights or delegate his or its duties under this Employment Agreement without the prior written consent of the other party; provided, however, that this Agreement shall inure to the benefit of and be binding upon the successors and assignees of
the Company, all as though such successors and assignees of the Company and their respective successors and assignees were of the Company, upon (a) a sale of all or substantially all of the Company’s assets, or upon merger or consolidation
of the Company with or into any other corporation, and (b) upon delivery on the effective day of such sale, merger or consolidation to the Executive of a binding instrument of assumption by such successors and assigns of the rights and
liabilities of the Company under this Agreement, provided, however, that no such assignment or transfer will relieve the Company from its payment obligations hereunder in the event the transferee or assignee fails to timely discharge them. No rights
or obligations of the Executive under this Agreement may be assigned or transferred other than his rights to compensation and benefits, which may be transferred by will or operation of law or as otherwise specifically provided or permitted hereunder
or under the terms of any applicable employee benefit plan. 
  

	 	16.	Contract Renewal 

 The Executive and the Company
will attempt to have completed the negotiation of an extension of this agreement by January 1, 2006. If no agreement has been reached by that time, the Executive may ask the Company to extend this Agreement by one year under the existing terms
of the Agreement, along with a 3% base compensation increase. If, by February 28, 2006, the Company has not presented a renewal offer comparable to the current contact, the Executive may be released from the agreement and will be entitled to
one year’s compensation, including those benefits described in Sections 4(a), (b), (c) and (d) hereof. 
  

	 	17.	Notices 

 Any notice required or desired to be given
hereunder shall be in writing and shall be deemed sufficiently given when delivered or 3 days after mailing in United States certified or registered mail, postage prepaid, to the party for whom intended at the following address: 
  

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 The Company: 
 NTN COMMUNICATIONS, INC 
 5966 La Place Court 
 Suite 100 
 Carlsbad, CA 92001 
 The
Executive: 
 Stanley B. Kinsey 
 P. O. Box 3050 
 6821 Farms View Court 
 Rancho Santa Fe, CA 92067 
 or to such other
address as either party may from time to time designate by like notice to the other. 
  

	 	18.	General 

 The terms and provisions of this Agreement
shall constitute the entire agreement by the Company and the Executive with respect to the subject manner hereof, and shall supersede any and all prior agreements or understandings between the Executive and the Company, whether written or oral. This
Agreement may be amended or modified only by a written instrument executed by the Executive and the Company, and any such amendment or modification or any termination of this Agreement shall become effective only after written approval thereof has
been received by the Executive. This Agreement shall be governed by and construed in accordance with California law. In the event that any terms or provisions of this Agreement shall be held to be invalid or unenforceable, such invalidity or
unenforceability shall not affect the validity or enforceability of the remaining terms and provisions hereof. In the event of any judicial, arbitral or other proceeding between the parties hereto with respect to the subject matter hereof, the
prevailing party shall be entitled, in addition to all other relief, to reasonable attorney’s fees and expenses and court costs. 
 IN
WITNESS WHEREOF, the parties have executed this Agreement as of the day and year limit above written. 
  

									
		 		 	NTN COMMUNICATIONS. INC.
				
		 		 	 By:
	 	/s/ Andy Wrobel
		 		 		 		 	Secretary

  

									
	 AGREED TO AND ACCEPTED:
	 		 	
					
	By	 	/s/ Stanley B. Kinsey	 		 	 By:
	 	/s/ Gary Arten
		 	Stanley B. Kinsey	 		 		 	Gary Arten
		 		 		 		 	Chair, NTN Compensation Committee

  

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