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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act 1934

 

Date of Report (date of earliest event reported): February 16, 2024

 

SHARPLINK GAMING, INC.

(Exact name of registrant as specified in charter)

 

Delaware   001-41962   87-4752260

(State of

Incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

 

333 Washington Avenue North, Suite 104

Minneapolis, Minnesota 55402

(Address of Principal Executive Offices) (Zip Code)

 

612-293-0619

(Registrant’s Telephone Number, Including Area Code)

 

 

(Former Name or Former Address, is Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
   
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
   
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
   
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
Common Stock   SBET   The Nasdaq Stock Market, LLC

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

 

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

 

 

ITEM 5.02 DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS, APPOINTMENT OF PRINCIPAL OFFICERS.

 

(b) Departure of Director

 

On February 16, 2024, the Board of Directors (the “Board”) of SharpLink Gaming, Inc. (“SharpLink” or the “Company”) accepted the resignation of Adrienne Anderson as a director on the Board, as Chairperson of the Audit Committee and as a member of the Compensation Committee, effective immediately. The resignation of Ms. Anderson was not the result of any disagreement with the Company, its management, the Board or any committee of the Board.

 

In connection with Ms. Anderson resigning as Chairperson of the Audit Committee, the Board has appointed current Board member, Leslie Bernhard, as the Audit Committee’s new Chair. The Board has assessed and determined that Ms. Bernhard qualifies as a financial expert, as defined by prevailing rules of the Nasdaq Stock Market and U.S. Securities and Exchange Commission.

 

(d) Election of Directors

 

On February 16, 2024, the Board approved the appointment of Robert Gutkowski as a new member of the Board, effective February 16, 2024, to fill the vacancy resulting from Ms. Anderson’s departure. The Board assessed the independence of Mr. Gutkowski as defined by the independence standards under Nasdaq rules and has determined that he is independent. Mr. Gutkowski will serve as a director until SharpLink’s 2024 Annual Meeting of Stockholders and until his successor is elected and qualified or until the earlier of his death, resignation or removal. In addition, Mr. Gutkowski will serve as a member of the Audit Committee and the Compensation Committee.

 

In connection with his appointment, SharpLink entered into a director agreement and a Confidentiality Agreement with Mr. Gutkowski. Mr. Gutkowski is not a party to any transaction with SharpLink that would require disclosure under Item 404(a) of Regulation S-K, and there are no arrangements or understandings between Mr. Gutkowski and any other persons pursuant to which he was selected to serve as a director.

 

Pursuant to the director agreement between SharpLink and Mr. Gutkowski, Mr. Gutkowski will receive an annual retainer of $30,000 paid in equal quarterly amounts as his compensation for serving as a director of the Board, and an annual retainer of $10,000 paid in equal quarterly amounts for serving as a member of the Audit Committee and the Compensation Committee. In addition, pursuant to the Company’s 2023 Equity Incentive Plan (the “Plan”), he was granted 40,000 restricted stock units (“RSUs”) which shall vest in equal quarterly installments in 2024, or on March 31, 2024, June 30, 2024, September 30, 2024 and December 31, 2024, subject to his continued service as a director through each applicable vesting date. Pursuant to the Confidentiality Agreement between SharpLink and Mr. Gutkowski, Mr. Gutkowski agreed to not disclose and to maintain the confidentiality of the confidential information shared by SharpLink with board members in order to permit him to carry out his responsibilities as a director.

 

The description of the director agreement and Confidentiality Agreement with Mr. Gutkowski contained herein does not purport to be complete and is qualified in its entirety by reference to the full text of the agreements which are attached hereto as Exhibits 10.1 and 10.2, respectively, and are incorporated by reference herein.

 

Biography of Mr. Robert Gutkowski

 

Over a career spanning more than five decades, Mr. Gutkowski has proven to be a significant asset builder in the sports, entertainment and media industries. Among his key achievements was the landmark New York Yankees-Madison Square Garden Network (“MSG Network”) $486 million cable distribution deal. This transaction forever changed the sports economic landscape, increased the value of the MSG Network by nearly 2,000%, and enabled the Yankees to dominate Major League Baseball media during the past two decades. In addition, Mr. Gutkowski was the original architect behind radio entrepreneur Bob Sillerman’s roll-up of regional, independent concert promoters, which created SFX Entertainment, Inc. (“SFX”) - the first nationwide, vertically-integrated, concert promotion company. SFX transformed the multi-billion dollar live music concert industry. Mr. Gutkowski, a friend and advisor to George Steinbrenner, was the architect for the New York Yankees creation of their own regional sports network, which ultimately became the YES Network.

 

 

 

From October 2014 through the present, Mr. Gutkowski has led RMG Sports Ventures LLC, a company he founded, to originate and advise private equity and other institutional capital on investments in sports, entertainment and media. Mr. Gutkowski recently co-originated the acquisition of True Temper Sports (the largest producer of golf shafts in the world) for Lincolnshire Management and made a substantial investment alongside Lincolnshire in True Temper Sports.

 

In December 1991, Mr. Gutkowski was named President of MSG Network, where he was responsible for the operations of the New York Knicks basketball team, the New York Rangers hockey team - which won the 1994 Stanley Cup Championship, MSG Communications - including the MSG Network, the nation’s largest regional cable network, MSG Entertainment, and the MSG Facilities Group - which operated The Garden Arena and The Paramount Theater. Mr. Gutkowski joined MSG Network in 1985 and held various senior executive positions, including President of the MSG Network. Under his leadership, the subscriber base of the MSG Network, the oldest and largest regional sports network in the country, more than doubled to 5.1 million subscribers. The Yankees, together with the New York Knicks and the New York Rangers, became the foundations of MSG Network’s year-round operation. In 1993 and 1994, MSG Network was the most active building in the country in bookings and revenues and was named “Arena of the Year” by Pollstar Magazine.

 

In 1996, Mr. Gutkowski founded The Marquee Group, a worldwide sports and entertainment firm that managed, produced and marketed sports and entertainment events, as well as provided representation for athletes, entertainers and broadcasters. The Marquee Group, which became a public company in 1996, acquired many related companies, including Athletes and Artists, Sports Marketing and Television International, QBQ Entertainment, Tollin-Robbins Productions, Park Associates, Alphabet City Records, Cambridge Golf and ProServ, before being acquired by SFX in 1999 for over $100 million.

 

Mr. Gutkowski is a graduate of Hofstra University, where he earned a Bachelor of Business Administration degree.

 

(e) Compensatory Arrangements of Certain Officers

 

On February 16, 2024, the Board approved and adopted the Company’s 2024 Executive Compensation Plan, which describes SharpLink’s compensation philosophy and policies as applicable to the named executive officers for 2024, and explains the structure and rationale associated with each material element of the executives’ compensation.

 

The preceding summary of the 2024 Executive Compensation Plan is qualified in its entirety by reference to the full text of such plan, a copy of which is attached as Exhibit 10.3 hereto and incorporated herein by reference.

 

In accordance with the 2024 Executive Compensation Plan, on February 16, 2024, the Board approved, and the Company entered into, executive employment agreements with Rob Phythian, its Chairman and Chief Executive Officer, and with Robert DeLucia, its Chief Financial Officer, effective as of February 14, 2024.

 

Phythian Employment Agreement

 

Mr. Phythian’s employment agreement (the “Phythian Agreement”) provides for an annual base salary of $285,000 (“Phythian Base Salary”) and an annual performance-based cash bonus up to 42.5% of the annual base salary, as determined and approved by the Compensation Committee. In addition, the Company shall directly pay or reimburse Mr. Phythian up to $10,000 annually for the following: i) premiums of a term life insurance policy and ii) if elected, executive health exams not covered by the Company’s prevailing benefits plan. In addition, the Company shall directly pay or reimburse Mr. Phythian up to $12,000 annually for payment of country club annual dues. Mr. Phythian was also granted 100,000 RSUs pursuant to the Plan, which shall vest in equal increments on March 31, 2024, June 30, 2024, September 30, 2024 and December 31, 2024. Mr. Phythian shall be eligible to be granted additional equity awards in accordance with the Company’s policies as in effect from time to time, as recommended and approved by the Compensation Committee.

 

The Phythian Agreement is for an initial term of two years (“Phythian Initial Term”), subject to earlier termination, and will be automatically extended for successive one-year periods unless either party gives written notice of termination at least 120 days in advance of the expiration of the Phythian Initial Term or the then-current term, as applicable.

 

The Phythian Agreement provides that if Mr. Phythian is terminated by the Company without cause or if he terminates his employment for good reason, he will be entitled to: i) continuation of the Phythian Base Salary at the rate in effect immediately prior to the termination date for 12 months following the termination date paid accordance with the Company’s normal payroll practices, but no less frequently than monthly; and ii) if Mr. Phythian elects to continue group health coverage under any Company group health plan pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), the Company shall reimburse Mr. Phythian for a portion of his COBRA premiums, such that his unreimbursed cost of COBRA premiums does not exceed the cost to Mr. Phythian of such health plan premiums immediately prior to termination, for a period of up to one year after his termination (or until he is no longer eligible for COBRA continuation, if earlier). In addition, Mr. Phythian shall be entitled to severance, payable in a lump sum equal to 100% of the Phythian Base Salary.

 

 

 

If employment is terminated by the Company for cause or by Mr. Phythian for other than good reason, Mr. Phythian will be entitled only to the accrued salary and bonus obligations through the date of termination.

 

The foregoing description of the Phythian Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of that agreement, a copy of which is attached as Exhibit 10.4 to and made a part of this Current Report on Form 8-K and is incorporated by reference herein.

 

DeLucia Employment Agreement

 

Mr. DeLucia’s employment agreement (the “DeLucia Agreement”) provides for an annual base salary of $230,000 (“DeLucia Base Salary”) and an annual performance-based cash bonus up to 40% of his annual base salary, as determined and approved by the Compensation Committee. In addition, the Company shall directly pay or reimburse Mr. DeLucia up to $10,000 annually for the following: i) for the premiums of a term life insurance policy and, ii) if elected, executive health exams not covered by the Company’s prevailing benefits plan. In addition, Mr. DeLucia was granted 80,000 RSUs pursuant to the Plan, which shall vest in equal increments on March 31, 2024, June 30, 2024, September 30, 2024 and December 31, 2024. Mr. DeLucia shall be eligible to be granted additional equity awards in accordance with the Company’s policies as in effect from time to time, as recommended and approved by the Compensation Committee.

 

The DeLucia Agreement is for an initial term of two years (“DeLucia Initial Term”), subject to earlier termination, and will be automatically extended for successive one-year periods unless either party gives written notice of termination at least 120 days in advance of the expiration of the DeLucia Initial Term or the then-current term, as applicable.

 

The DeLucia Agreement provides that if Mr. DeLucia is terminated by the Company without cause or if he terminates his employment for good reason, he will be entitled to: i) continuation of the DeLucia Base Salary at the rate in effect immediately prior to the termination date for 12 months following the termination date paid accordance with the Company’s normal payroll practices, but no less frequently than monthly; and ii) if Mr. DeLucia elects to continue group health coverage under any Company group health plan pursuant to the COBRA, the Company shall reimburse Mr. DeLucia for a portion of his COBRA premiums, such that his unreimbursed cost of COBRA premiums does not exceed the cost to Mr. DeLucia of such health plan premiums immediately prior to termination, for a period of up to one year after his termination (or until he is no longer eligible for COBRA continuation, if earlier). In addition, Mr. DeLucia shall be entitled to severance, payable in a lump sum equal to 100% of the DeLucia Base Salary.

 

If employment is terminated by the Company for cause or by Mr. DeLucia for other than good reason, the executive will be entitled only to the accrued salary and bonus obligations through the date of termination.

 

The foregoing description of the DeLucia Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of that agreement, a copy of which is attached as Exhibit 10.5 to and made a part of this Current Report on Form 8-K and is incorporated by reference herein.

 

ITEM 7.01 REGULATION FD DISCLOSURE.

 

On February 21, 2024, SharpLink issued a press release relating to the Board changes. A copy of the press release is furnished as Exhibit 99.1.

 

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

 

(d) Exhibits.

 

Exhibit Number   Description
     
10.1   Director Agreement with Robert Gutkowski, dated February 16, 2024
     
10.2   Confidentiality Agreement with Robert Gutkowski, dated February 16, 2024
     
10.3   2024 Executive Compensation Plan, adopted February 16, 2024
     
10.4   Employment Agreement with Rob Phythian, dated February 16, 2024
     
10.5   Employment Agreement with Robert DeLucia, dated February 16, 2024
     
99.1   Press Release titled “SharpLink Gaming Announces Board and Audit Committee Changes,” dated February 21, 2024
     
104   Cover page from this Current Report on Form 8-K, formatted in Inline XBRL

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  SHARPLINK GAMING, INC.
     
  By: /s/ Rob Phythian
  Name: Rob Phythian
  Title: Chief Executive Officer
Dated: February 21, 2024    

 

 

EX-10.1 2 ex10-1.htm

 

Exhibit 10.1

 

 

 

February 16, 2024

 

Mr. Robert M. Gutkowski

 

Via Email to: rmgutkowski@aol.com

 

Dear Bob:

 

It is my sincere pleasure, on behalf of the entire Board of Directors, to invite you to become a Director of SharpLink Gaming, Inc. (“SharpLink” or the “Company”), effective February 16, 2024. As a member of the Board, we believe your notable experience and expertise will add an important perspective to the Board’s operations.

 

Position

 

You have been recommended and Board approved for appointment as an independent member of the Board of Directors of the Company and appointment to each of the Board committees, namely the Audit Committee and the Compensation Committee.

 

Base Board Compensation

In accordance with SharpLink’s Director Compensation Plan, you will receive an annual retainer of $30,000 paid in equal quarterly amounts of $7,500 at the end of each quarter for which you have provided service. Since this fee will not be subject to ordinary withholdings, you will be entirely responsible for the accounting and payment of any taxes that may be due as a result of this income to you.

 

Committee(s) Compensation

For your service as a member of the Audit and Compensation Committees, you will receive additional annual cash compensation of $10,000, paid in equal quarterly amounts of $2,500 at the end of each quarter for which you have provided service.

 

Equity

On February 16, 2024, you will automatically be granted 40,000 restricted stock units (“RSUs”), which shall vest in equal quarterly installments over one year (the “RSU Grant”), subject to your continued service as a director through each applicable vesting date, which are March 31, 2024, June 30, 2024, September 30, 2024 and December 31, 2024.

 

Change of Control

The RSU Grant shall accelerate and vest in full upon a sale event resulting in a change of control, as further defined in our 2023 Equity Incentive Plan.

 

Reimbursed Expenses

You will be reimbursed for normal out of pocket travel expenses incurred by you in your service as a Director, based upon an invoice submitted by you to the Company in a timely fashion.

 

Confidentiality Execution of the attached Mutual Non-Disclosure Agreement shall also form the basis of your agreement to join the Company’s Board of Directors.

 

    Page 1 of 2

 

Term

 

 

In accordance with SharpLink’s Certificate of Incorporation, you shall stand for re-election at each annual meeting of shareholders and shall serve until your successor is duly elected and qualified or until your earlier death, resignation or removal.

 

We look forward to hearing that you will join us in our mission to establish SharpLink as a leading, industry respected affiliate marketing services company serving the global sports betting and casino gaming markets.

 

Sincerely,
 

/s/ Rob Phythian

Rob Phythian
Chairman and Chief Executive Officer
   
Accepted By:

/s/ Robert Gutkowski

  Robert Gutkowski
   
Date: February 16, 2024

 

    Page 2 of 2

 

EX-10.2 3 ex10-2.htm

 

Exhibit 10.2

 

 

 

BOARD OF DIRECTORS

CONFIDENTIALITY AGREEMENT

 

This Confidentiality Agreement is entered into this 16th day of February, 2024 between SharpLink Gaming, Inc. (“SharpLink” or the “Company”), a Delaware Corporation, and Robert Gutkowski (the “Director”).

 

WHEREAS, the Director has been elected to and has agreed to serve as an independent member of the Board of Directors of SharpLink;

 

WHEREAS, the undersigned acknowledges that a Director’s fiduciary duty includes the obligation to not disclose and to maintain the confidentiality of the Confidential Information shared by SharpLink with Board Members in order to permit them to carry out their responsibilities as Directors;

 

WHEREAS, the parties agree that it is appropriate to enter into this Agreement by which the Director acknowledges his/her fiduciary duty to maintain, protect and not disclose the Confidential Information of SharpLink both during her term as Director and thereafter;

 

NOW, THEREFORE, in consideration of the mutual promises herein contained, the parties agree as follows:

 

1. Confidential Information. As used herein, “Confidential Information” means all information furnished by SharpLink to the Director in connection with the performance by the Director of her Board responsibilities which should be reasonably understood by the Director to be confidential or proprietary information of SharpLink, whether furnished orally or in writing, and regardless of whether specifically identified as “confidential” and all notes, analyses, compilations, studies or other documents which contain or otherwise reflect such Confidential Information.

 

2. Confidential Information Exclusions. The provisions of this Agreement shall not apply to information in the public domain at the time it is shared with the Director; information that, after disclosure to the Director, becomes part of the public domain through dissemination by SharpLink; generic information or knowledge that the Director would have learned in the course of similar board experiences; and information which was not acquired directly or indirectly from SharpLink.

 

3. Non-Disclosure and Use of Confidential Information. The Director agrees that during her term as a Board Member and for two (2) years thereafter to:

 

(a) Hold in confidence and not to directly or indirectly disclose, disseminate, divulge, lecture upon, publish, report, reveal or transfer any Confidential Information to any person or entity;

 

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(b) Not directly or indirectly make use of any Confidential Information except for the purposes of carrying out her responsibilities as a Director; and

 

(c) Not permit unauthorized use of any Confidential Information by any (c) person or entity.

 

4. Ownership and Return of Documents. All Confidential Information remains the exclusive property of SharpLink. SharpLink’s administrative staff will instruct the Director in the proper retention/destruction of Confidential Information which may have been supplied to him/her as part of her duties.

 

5. Enforcement. SharpLink’s executive management team, in consultation with its legal counsel and the Board of Directors, will determine whether a breach of this policy has occurred and how it will be addressed, including, if necessary, the pursuit of legal remedies by SharpLink.

 

IN WITNESS WHEREOF, the Director and SharpLink have caused this Confidentiality Agreement to be executed as of the day and year first above written.

 

ROBERT GUTKOWSKI   SHARPLINK GAMING, INC.
         
By: /s/ Robert Gutkowski   By: /s/ Rob Phythian
  Robert Gutkowski     Rob Phythian
        Chairman and Chief Executive Officer

 

2

 

 

EX-10.3 4 ex10-3.htm

 

Exhibit 10.3

 

 

2024 Executive Compensation Plan

 

OVERVIEW: Executive Compensation and Analysis

 

The Compensation Committee is committed to the close alignment of our executive pay programs with Company and individual performance and our stockholders’ interest, while ensuring we can attract and retain key talent in the organization. For 2024, SharpLink’s named executive officers (“NEOs”) are as follows:

 

  Rob Phythian, Chief Executive Officer
     
  Robert DeLucia, Chief Financial Officer

 

Our Compensation Philosophy

 

SharpLink’s executive compensation program is designed to attract, motivate, retain and fairly reward highly skilled executives who bring the business acumen necessary to achieve our long-term business objectives. We pay for performance and design executive compensation programs that reward short- and long-term performance and align the financial interests of our executive officers with those of our shareholders. To that end, the compensation packages provided to our NEOs include both cash- and equity-based components. We evaluate performance and compensation levels to ensure that:

 

  We maintain our ability to attract and retain outstanding employees in executive positions;
     
  Executive compensation remains competitive with the compensation paid to similarly situated executives at comparable companies; and
     
  Compensation programs are applied in an internally consistent manner.

 

What We Do in Our Compensation Programs

 

  Establish, communicate and monitor measurable goals and objectives;
     
  Review total compensation when making executive compensation decisions;
     
  Establish maximum award levels for short- and long-term incentive plans;
     
  Assess our programs against peer companies and best industry practices;
     
  Require executives to set up 10b5-1 programs to properly manage all stock transactions;
     
  Avoid incentives that encourage excessive risk;
     
  Annually assess risks associated with our compensation program; and
     
  Subject incentive compensation of executives to our formal clawback policy.

 

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Roles of the Compensation Committee, Management and Peer Groups

 

Role of the Compensation Committee

 

Our Compensation Committee is responsible for establishing the compensation of our NEOs; and oversees administration of the Company’s executive compensation plan, policies and programs, including providing guidance on corporate goals and objectives relating to compensation, short-term bonus (incentive) plans and long-term equity compensation plans, and approval of grants of equity awards.

 

Role of Management

 

Management participates in the review and refinement of our executive compensation program. The CEO meets with Committee members to discuss compensation packages for the NEOs and to review the performance of the Company and each NEO, other than himself, and makes recommendations with respect to the appropriate base salary, annual cash bonus, event-driven bonus(es) and grants of short- and long-term equity awards.

 

Role of Peer Groups, Surveys and Benchmarking

 

We consider multiple sources of data to evaluate the fairness of potential rewards associated with our compensation structures and whether they meet our compensation objectives. We also consider how our compensation practices compare to market practices among relevant companies in terms of size and/or industry. Among other factors, we carefully evaluate compensation data for executive officer positions for public companies of our size and/or operating in our industry culled from proxy statements filed with the U.S. Securities and Exchange Commission. The Committee may consider competitive market compensation of peer group companies but does not attempt to maintain a certain target percentile within the peer group or otherwise rely solely on such data. The Committee strives to incorporate flexibility into the compensation programs and processes to respond to and adjust for SharpLink’s evolving business and the value delivered by our NEOs.

 

2024 Peer Groups

 

For 2024, the Committee utilized two separate compensation peer groups in order to best assess alignment and competitiveness of the compensation of our NEOs with U.S.-based public peers operating in our industry or are characterized as “nano cap” companies which have market capitalization below $50 million and annual revenues under $10 million. The 2024 peer groups included the following:

 

Industry Peers:

 

It is important to note that most sports betting and casino gaming companies trading on U.S. exchanges are foreign private issuers which are headquartered outside of the U.S. (primarily Europe) – as such, they are not required to disclose detailed executive compensation data in their filings. Thus, the industry peer group is confined to three primary peers:

 

  EBET, Inc.
     
  Elys Game Technology Corp.
     
  Rush Street Interactive, Inc.

 

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Nano Cap Peers:

 

  Allied Gaming & Entertainment
     
  BIMI Holdings Inc.
     
  Biomerica, Inc.
     
  Matinas BioPharma Holdings
     
  Milestone Scientific
     
  Neonode, Inc.
     
  Palatin Technologies
     
  Phoenix Motors Inc.

 

The key elements of our executive compensation packages for NEOs are base salary, short-term (annual) cash bonus, one-time cash bonus for significant milestone events being achieved, equity-based awards and our employee benefits programs.

 

A base salary provides our NEOs with a competitive level of fixed compensation, which reflects individual performance and scope of responsibilities, as well as the competitive market for executive talent; and benefits our shareholders by offering competitive salaries that will allow us to attract and retain talented executives. In determining base salaries for our NEOs, the Committee considers a number of factors including:

 

  The scope of responsibilities, prior experience and qualifications;
     
  Past individual performance;
     
  Base salary and total compensation relative to other executives in similar positions;
     
  Competitive market conditions and market data; and
     
  Recommendations of the CEO, other than with respect to his own compensation.

 

  An (annual) cash bonus rewards our NEOs for achieving Company and individual goals over the course of the year; and benefits our shareholders by ensuring our NEOs remain focused on meeting key short-term business objectives and performance metrics.  We offer our NEOs the opportunity to earn annual cash bonuses based on achieving performance against Committee-approved performance goals.  The Committee, in its sole discretion, with respect to the CEO and in collaboration with the CEO for all other NEOs, determines whether and to what extent annual cash bonuses shall be paid to each NEO.
     
  One-time cash bonuses reward our NEOs who play a material role in a significant milestone achieved by the Company, e.g., completing a strategic acquisition that has positive impact on SharpLink’s overall financial performance or raising mission critical growth capital.  The Committee, in its sole discretion, with respect to the CEO and in collaboration with the CEO for all other NEOs, determines whether and to what extent one-time cash bonuses are paid to each NEO based on the materiality of each significant milestone achieved.
     
  Equity-based awards incentivize our NEOs, designed to drive achievement of long-term operational and financial goals and increased shareholder value, as well as to attract and retain key talent over a sustained time period.  The Committee sets each NEOs’ equity based awards on their respective role and responsibilities, internal equity considerations,  competitive market conditions and data and target direct compensation.  
     
  In addition to the primary elements of compensation described above, the NEOs may participate in benefits programs generally available to our employees.  In addition, our CEO and CFO are entitled to receive monthly cash consideration for certain expenses, including term life insurance policy premiums, executive health exams not covered by prevailing health benefit plan and/or country club fees, as applicable.

 

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2024 Executive Compensation Plan

 

Approved and Adopted by the Compensation Committee on February 16, 2024

 

2024 Key Performance Indicators (“KPIs”) for Company = Goal Weighting – 50%

 

  Annual total revenue growth of Affiliate Marketing Services US = greater than 20% year-over year increase
     
  Operating income = greater than 10% year-over year improvement

 

2024 KPIs for NEOs = Goal Weighting – 50%

 

  Rob Phythian, CEO –  Rob is charged with executing on the Company’s vision and strategic growth objectives, with particular emphasis on improving overall business performance, improving systems and processes, optimizing performance of individual business segments and driving cost and operational efficiencies across the enterprise, which collectively result in increased shareholder value.
     
  Robert DeLucia, CFO –  A strategic partner to the CEO, Bob is charged with overseeing and managing the Company’s the overall Company’s financial position and activities such as the audit, accounting and SEC reporting activities with emphasis on achieving measurable improvements in treasury and cash management; forecasting accuracy and accountability; capital formation strategic initiatives by successfully leveraging debt and equity vehicles, as/when appropriate; and timely management of all SEC filings and state and federal tax filings.  Bob is also tasked with managing the Company’s stock option plan platform, OptionTrax.

 

2024 Compensation Programs for NEOs

 

Rob Phythian, CEO

 

  Base salary: $285,000
     
  Annual Cash Bonus: Up to 42.5% of Base, or $121,125
     
  Restricted Stock Units: 100,000 (vest quarterly in 2024)
     
  All Other Compensation: Up to $22,000 annually to cover costs for term life insurance policy, executive health exams not covered by prevailing health benefit plan and country club dues

 

Robert DeLucia, CFO

 

  Base salary: $230,000
     
  Annual Cash Bonus: Up to 40% of base, or $92,000
     
  Restricted Stock Units: 80,000 (vest quarterly in 2024)
     
  All Other Compensation: Up to $10,000 annually to cover costs for a term life insurance policy and executive health exams not covered by prevailing health benefit plan

 

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2024 Board Compensation Plan

 

Approved and Adopted by the Board of Directors on February 13, 2024

 

Director compensation is set by the Board of Directors upon the recommendation of the Compensation Committee. The Compensation Committee conducts an annual review of non-employee director compensation, including consideration of analysis of director compensation for the same peer group used by the Compensation Committee for the assessment of executive compensation. For 2024, non-employee directors will receive compensation for services as directors pursuant to this 2024 Board Compensation Plan adopted by the Board of Directors on February 13, 2024. Pursuant to this 2024 Board Compensation Plan, non-employee directors will receive:

 

  A base annual fee of $30,000 for services from February 14, 2024 through December 31, 2024, payable quarterly at the end of each calendar quarter, or March 31, 2024; June 30, 2024; September 30, 2024; and December 31, 2024.
     
  Additional cash compensation for services on Committees.

 

  Directors who serve as the Chair of the Audit or Compensation Committee will receive $15,000 annually, payable quarterly at the end of each calendar quarter, or on March 31, 2024; June 30, 2024; September 30, 2024; and December 31, 2024.
     
  Directors serving on the Audit and Compensation Committees, and are not already receiving compensation for serving as the Chair of one of those committees, will receive $10,000 annually, payable quarterly at the end of each calendar quarter, or on March 31, 2024; June 30, 2024; September 30, 2024; and December 31, 2024.

 

Equity consideration issuable as follows:

 

Each of the non-employees directors will be issued 40,000 Restricted Stock Units on February 14, 2024, which shall vest in equal increments of 10,000 RSUs at the end of each calendar quarter in 2024, or on March 31, 2024; June 30, 2024; September 30, 2024; and December 31, 2024.

 

5

 

EX-10.5 5 ex10-4.htm

 

Exhibit 10.4

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (the “Agreement”) is entered into by and between SHARPLINK GAMING, INC. (the “Company”) and ROBERT PHYTHIAN (the “Executive”). The Company and the Executive may hereinafter be referred to jointly as the “Parties.”

 

WITNESSETH:

 

WHEREAS, the parties desire to enter into an employment agreement on the terms and conditions set forth herein;

 

WHEREAS, the Executive’s employment shall commence under this agreement on February 14, 2024 (the “Effective Date”).

 

WHEREAS, the Executive will serve as Chief Executive Officer of the Company and thus a key senior executive of the Company, as well as an executive member of the Board;

 

WHEREAS, the Company would like enter into a formal agreement with the Executive to set forth the terms of Executive’s employment and to provide for certain severance payments and other benefits in the event Executive’s employment is terminated by the Company without cause or by the Executive for “Good Reason” (as defined below); and

 

WHEREAS, Executive wishes to be employed by the Company and provide full-time services to the Company in return for the compensation and benefits detailed herein.

 

NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, including the agreements set forth below, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:

 

  1. Employment.

 

  a. Term. Subject to Section 4 hereof, the Company agrees to employ the Executive, and the Executive agrees to be employed by the Company for a period commencing on the Effective Date and ending on the second anniversary of the Effective Date (the “Initial Term”); provided however that the period of the Executive’s employment pursuant to this Agreement shall be automatically extended for successive one-year periods thereafter (each, a “Renewal Term”), in each case unless either Party hereto provides the other Party hereto with written notice that such period shall not be so extended at least one hundred and twenty (120) days in advance of the expiration of the Initial Term or the then-current Term, as applicable (the Initial Term and any Renewal Term, collectively, the “Term”). The Executive’s period of employment pursuant to this Agreement shall hereinafter be referred to as the “Employment Period.”
     
  b. Position and Duties. Executive (i) shall serve as the Chief Executive Officer of the Company with responsibilities, duties and authority customary for such position; (ii) shall report directly to the Board of Directors; (iii) shall devote substantially all Executive’s working time and efforts to the business and affairs of the Company and its subsidiaries; and (iv) agrees to observe and comply with the Company’s rules and policies as adopted by the Company from time to time. In addition, as of the Effective Date, the Executive shall retain his appointment as an executive member of the Board and the Company shall use commercially reasonable efforts to cause Executive to be reelected as a member of the Board while employed hereunder.

 

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  c. Place of Employment. Executive shall perform the services required by this Agreement at his primary base of operations in Minneapolis, Minnesota. In addition, the Company may from time to time require Executive to travel temporarily to other locations on the Company’s business.

 

  2. Compensation and Related Matters.

 

  a. Annual Base Salary. Executive shall receive a base salary at the rate of $285,000 per annum (the “Annual Base Salary”), subject to withholdings and deductions and which shall be paid to Executive in accordance with the customary payroll practices and procedures of the Company. Such Annual Base Salary shall be reviewed by the Board’s Compensation Committee not less than annually and may be adjusted from time to time.
     
  b. Annual Bonus. Commencing in the calendar year 2024 and each calendar year thereafter during Executive’s employment with the Company, Executive will be eligible to receive a discretionary annual performance bonus, with a target achievement of up to 42.5% of the Annual Base Salary (the “Annual Bonus”). The amount of the Annual Bonus that shall be payable shall be based on the achievement of predetermined performance goals to be determined by the Board, in its sole discretion. The amount of any Annual Bonus for which Executive is eligible shall be reviewed by the Board from time to time, provided that that target achievement for the Annual Bonus shall not be less than up to 30% of the Annual Base Salary. Any Annual Bonus earned by Executive pursuant to this section shall be paid to Executive in accordance with Company policies, less authorized deductions and required withholding obligations, and is payable within 75 days following the end of the calendar year, ended December 31.
     
  c. Benefits. Executive shall participate in such full-time employee and executive benefit plans and programs as the Company may from time to time offer to senior executives of the Company, subject to the terms and conditions of such plans, including, without limitation, an executive family medical package.
     
  d. Life Insurance and Executive Health Exams. The Company shall directly pay or reimburse Executive for the premiums of a term life insurance policy and, if elected, executive health exams not covered by the Company’s prevailing benefits plan, up to a maximum of $10,000 annually. If Executive’s employment terminates for any or no reason, the Company shall have no obligation to continue to bear the costs of the life insurance policy for Executive, but Executive may choose to assume responsibility for payments required to continue the policy.
     
  e. Vacation. Executive shall be entitled to 30-days of paid time-off for vacation, as well as sick leave, holidays and other paid time-off benefits provided by the Company from time to time which are applicable to the Company’s executive officers in accordance with Company policy. The opportunity to take paid time off is contingent upon Executive’s workload and ability to manage his schedule.
     
  f. Business Expenses. The Company shall reimburse Executive for all reasonable, documented, out-of-pocket travel and other business expenses incurred by Executive in the performance of Executive’s duties to the Company in accordance with the Company’s applicable expense reimbursement policies and procedures as in effect from time to time.

 

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  3. Equity Awards.

 

  a. Restricted Stock Units. Subject to approval by the Board and pursuant to the provisions of the Company’s 2023 Equity Incentive Plan (the “Plan”), Executive shall be granted 100,000 Restricted Stock Units (“RSUs”) (the “Award”), with each RSU representing an unfunded, unsecured right for the Executive to receive one (1) share of the Company’s common stock. Subject to the terms of the Plan and the Restricted Stock Unit Award Agreement, including without limitation, fulfillment of the employment requirements set forth in Section 1 herein, the Award will vest in increments equal to 25% of the Award on March 31, 2024; June 30, 2024; September 30, 2024 and December 31, 2024.
     
  b. Additional Equity Awards. Executive shall be eligible to be granted additional equity awards in accordance with the Company’s policies as in effect from time to time, as recommended by the Compensation Committee and approved by the Board of Directors.

 

  4. Termination.

 

  a. Termination of Employment. The Company may terminate the Executive’s employment hereunder for any reason during the Term, and the Executive may voluntarily terminate his employment hereunder for any reason during the Term, in each case (other than a termination by the Company for Cause) at any time upon not less than 90-days notice to the other Party (the date on which the Executive’s employment terminates for any reason is herein referred to as the “Termination Date”). Upon the termination of the Executive’s employment with the Company for any reason, the Executive shall be entitled to (a) payment of any Base Salary earned but unpaid through the date of termination; (b) unused paid time off (consistent with Section 2.f. hereof) paid out at the per-business-day Base Salary rate; (c) additional vested benefits (if any) in accordance with the applicable terms of applicable Company arrangements; and (d) any unreimbursed expenses in accordance with Section 2.g. hereof (collectively, the “Accrued Amounts”). The Accrued Amounts described in Section 4.a. shall by paid to the Executive within 30 days following the Termination Date (or, if later, following the Executive’s presentation of supporting documentation for unreimbursed expenses in accordance with 2.g.).
     
  b. Termination by the Company other than for Cause, Death or Disability; Termination by the Executive for Good Reason. If the Executive’s employment is terminated (a) by the Company other than for Cause, death or Disability or (b) by the Executive for Good Reason, in addition to the Accrued Amounts, (i) the Executive shall be entitled to continuation of the Base Salary at the rate in effect immediately prior to the Termination Date for 12 months following the Termination Date paid in accordance with the Company’s normal payroll practices, but no less frequently than monthly (the “Base Salary Continuation”); and (ii) if the Executive elects to continue group health coverage under any Company group health plan pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), the Company shall reimburse the Executive for a portion of his COBRA premiums, such that his unreimbursed cost of COBRA premiums does not exceed the cost to the Executive of such health plan premiums immediately prior to termination, for a period of up to one year after his termination (or until he is no longer eligible for COBRA continuation, if sooner). Notwithstanding clause (ii) of the preceding sentence, such reimbursements for COBRA premiums shall not be made to the extent such payments would result in any additional tax or penalty to the Company under the Affordable Care Act or any other applicable law. In the event the group health coverage is self-insured, the Company shall include in the Executive’s gross income, the imputed value of the employer-subsidized COBRA premiums. The Executive shall be responsible for the full amount of COBRA premiums for any periods exceeding the time set forth above. In addition, in the event of a termination covered by this Section 4.b., the Executive shall be entitled to a lump sum payment equal to one hundred percent (100%) of his annual Base Salary (“Bonus Severance”). The Company’s obligations to pay the Base Salary Continuation, the Bonus Severance and COBRA premiums described above shall be conditioned upon the Executive’s continued compliance with his obligations under Section 4 of this Agreement. Notwithstanding any provision to the contrary herein, and without limitation of any remedies to which the Company may be entitled, the Base Salary Continuation shall be paid in equal installments commencing during the sixty (60) day period following the Termination Date, the Bonus Severance shall be paid during the sixty (60) day period following the Termination Date and the reimbursement of COBRA premiums shall be made after substantiation of such expenses; provided, that, the Executive has signed and delivered to the Company the release of claims substantially in the form attached hereto as Exhibits A and B (the “Release”) and the period (if any) during which the Release can be revoked has expired within such sixty (60) day period; provided, further, that, if such sixty (60) day period begins in one calendar year and ends in another calendar year, to the extent required under Section 409A (as defined below), payment of the Base Salary Continuation installments, Bonus Severance and reimbursement of the COBRA premiums that otherwise would have been paid during that sixty (60) day period shall be accumulated and paid in the second calendar year after expiration of the period for revoking the Release (but within the specified sixty (60) day period).

 

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  c. Voluntary Resignation by the Executive other than for Good Reason; Termination due to Death or Disability; Termination Due to, Upon or Following Non-Renewal of the Agreement. If (a) the Executive voluntarily terminates his employment at any time, other than for Good Reason, (b) if the Executive’s employment is terminated due to the Executive’s death or Disability or (c) if the Executive’s employment terminates due to, upon or following non-renewal of the Agreement by either Party in accordance with Section 1.a., then the Executive (or his estate) shall be entitled to no payment or compensation whatsoever from the Company under this Agreement, other than the Accrued Amounts.
     
  d. Termination by the Company for Cause. If the Company terminates the Executive’s employment for Cause, then the Executive shall be entitled to no payment or compensation whatsoever from the Company under this Agreement, other than the Accrued Amounts.
     
  e. Exclusive Remedy. The foregoing payments upon termination of the Executive’s employment shall constitute the exclusive severance payments and benefits due the Executive upon termination of his employment.
     
  f. Resignation from All Positions. Upon the termination of the Executive’s employment with the Company for any reason, the Executive shall resign, as of the Termination Date, from all positions he then holds as an officer, director, employee and member of the boards of directors (and any committee thereof) of the Board, if applicable. The Executive shall be required to execute such writings as are required to effectuate the foregoing.
     
  g. Cooperation. Following the termination of the Executive’s employment with the Company for any reason, the Executive shall reasonably cooperate with the Company upon reasonable request of the Board and be reasonably available to the Company (taking into account any other full-time employment of the Executive) with respect to matters arising out of the Executive’s services to the Company.

 

4 

 

  h. Duty of Confidentiality. Executive agrees that during employment with the Company and for a period of two (2) years following the termination or resignation of Executive from employment with the Company, Executive shall not, directly or indirectly, divulge or make use of any Confidential Information of the Company other than in the performance of Executive’s duties for the Company. While employed by the Company, Executive shall make all reasonable efforts to protect and maintain the confidentiality of the Confidential Information of the Company. In the event that Executive becomes aware of unauthorized disclosures of the Confidential Information by anyone at any time, whether intentionally or by accident, Executive shall promptly notify the Company. This Agreement does not limit the remedies available to the Company under common or statutory law as to trade secrets or other types of confidential information, which may impose longer duties of non-disclosure.
     
  i. Return of Property and Information. Executive agrees not to remove any Company property from Company premises, except when authorized by the Company. Executive agrees to return all Company property and information (whether confidential or not) within Executive’s possession or control within seven (7) calendar days following the termination or resignation of Executive from employment with the Company. Such property and information includes, but is not limited to, the original and any copy (regardless of the manner in which it is recorded) of all information provided by Company to Executive or which Executive has developed or collected in the scope of Executive’s employment with the Company, as well as all Company-issued equipment, supplies, accessories, vehicles, keys, instruments, tools, devices, computers, cell phones, pagers, materials, documents, plans, records, notebooks, drawings, or papers. Upon request by the Company, Executive shall certify in writing that Executive has complied with this provision; and has permanently deleted all Company information from any computers or other electronic storage devices or media owned by Executive. Executive may only retain information relating the Executive’s benefit plans and compensation to the extent needed to prepare Executive’s tax returns.
     
  j. Assignment of Work Product and Inventions. Executive hereby assigns and grants to the Company (and will upon request take any actions needed to formally assign and grant to Company and/or obtain patents, trademark registrations or copyrights belonging to Company) the sole and exclusive ownership of any and all inventions, information, reports, computer software or programs, writings, technical information or work product collected or developed by Executive, alone or with others, during the term of Executive’s employment relating to the Company. This duty applies whether or not the forgoing inventions or information are made or prepared in the course of employment with the Company, so long as such inventions or information relate to the Business of Company and have been developed in whole or in part during the term of Executive’s employment. Executive agrees to advise the Company in writing of each invention that Executive, alone or with others, makes or conceives during the term of Executive’s employment and which relate to the Business of Company. Notwithstanding any provision of this Agreement, Executive shall not be required to assign, nor shall Executive be deemed to have assigned, any of Executive’s rights in any invention that Executive develops entirely on his own time without using Company’s equipment, supplies, facilities, or Trade Secrets, except for inventions that either: (1) relate, at the time that the invention is conceived or reduced to practice, to the Business of Company or to actual or demonstrably anticipated research or development of the Company; or (2) result from any work performed by Executive for the Company on behalf of the Company. Inventions which Executive developed before Executive came to work for the Company, if any, are described in the attached Exhibit B, and excluded from this Section. The failure of the parties to attach any Exhibit B to this agreement shall be deemed an admission by Executive that Executive does not have any pre-existing inventions.

 

5 

 

  k. Non-Competition. Executive agrees that during the Restricted Period, and within the Restricted Territory, Executive shall not, directly or indirectly, whether on Executive’s own behalf or on behalf of any other person or entity, perform services on behalf of a Competing Business, and which are the same as or similar to those types of services conducted, authorized, offered, or provided by Executive to the Company within 24 months prior to Executive’s termination or resignation.
     
  l. Non-Recruitment of Company Employees and Contractors. Executive agrees that during the Restricted Period, Executive shall not, directly or indirectly, whether on Executive’s own behalf or on behalf of any other person or entity, solicit or induce any employee or independent contractor of the Company with whom Executive had Material Contact, to terminate or lessen such employment or contract with the Company.
     
  m. Non-Solicitation of Company Customers. Executive agrees that during the Restricted Period, Executive shall not, directly or indirectly, whether on Executive’s own behalf or on behalf of any other person or entity, solicit any actual or prospective customers of the Company with whom Executive had Material Contact, for the purpose of selling any products or services to such customers on behalf of a Competing Business.
     
  n. Non-Solicitation of Company Vendors. Executive agrees that during the Restricted Period, Executive shall not, directly or indirectly, whether on Executive’s own behalf or on behalf of any other person or entity, solicit any actual or prospective Vendor of the Company with whom Executive had Material Contact, for the purpose of purchasing products or services to support a Competing Business.
     
  o. Acknowledgements. Executive acknowledges and agrees that the provisions of Section 4 are reasonable as to time, scope and territory given the Company’s need to protect its Confidential Information and its relationships and goodwill with its customers, suppliers, employees and contractors, all of which have been developed at great time and expense to the Company. Executive represents that Executive has the skills and abilities to obtain alternative employment that would not violate these Restrictive Covenants in the event that Executive leaves employment with the Company, and that these Restrictive Covenants do not pose an undue hardship on Executive. Executive further acknowledges that Executive’s breach of any of the provisions of Section 4 would likely cause irreparable injury to the Company, and therefore entitle the Company to injunctive relief, in addition to any other remedies available in law or equity, without the necessity of posting a bond.

 

  5. Assignment and Successors.

 

The Company may assign its rights and obligations under this Agreement to any successor to all or substantially all of the business or the assets of the Company (by merger or otherwise), and may assign or encumber this Agreement and its rights hereunder as security for indebtedness of the Company and its affiliates. This Agreement shall be binding upon and inure to the benefit of the Company, Executive and their respective successors, assigns, personnel and legal representatives, executors, administrators, heirs, distributees, devisees, and legatees, as applicable. None of Executive’s rights or obligations may be assigned or transferred by Executive, other than Executive’s rights to payments hereunder, which may be transferred only by will or operation of law.

 

6 

 

  6. Miscellaneous Provisions.

 

  a. Work Eligibility; Confidentiality Agreement. As a condition of Executive’s employment with the Company, Executive will be required to provide evidence of Executive’s identity and eligibility for employment in the United States. It is required that Executive bring the appropriate documentation with Executive at the time of employment. As a further condition of Executive’s employment with the Company, Executive shall enter into and abide by the Company’s standard Proprietary Information and Inventions Assignment Agreement (the “Confidential Information Agreement”).
     
  b. Validity. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect. All questions concerning the construction, validity and interpretation of this Agreement will be governed by the laws of the State of Delaware without regard to the conflicts of law provisions thereof.
     
  c. Notices. Any notice, request, claim, demand, document and other communication hereunder to any Party shall be effective upon receipt (or refusal of receipt) and shall be in writing and delivered personally or sent by facsimile or certified or registered mail, postage prepaid (or if it is sent through any other method agreed upon by the parties), as follows:

 

  (i) If to the Company at:
    SharpLink Gaming, Inc.
    333 Washington Avenue North
    Suite 104
    Minneapolis, Minnesota 55401
     
  (ii) If to Executive, at the address set forth on Exhibit D.
     
  (iii) Or at any other address as any Party shall have specified by notice in writing to the other Party.

 

  d. Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, but all of which together will constitute one and the same Agreement. Signatures delivered by facsimile shall be deemed effective for all purposes.
     
  e. Entire Agreement. The terms of this Agreement, collectively with the Change in Control and Severance Agreement and the Confidential Information Agreement, is intended by the Parties to be the final expression of their agreement with respect to the employment of Executive by the Company and supersede all prior understandings and agreements, whether written or oral. The Parties further intend that this Agreement, collectively with the Change in Control and Severance Agreement and the Confidential Information Agreement, shall constitute the complete and exclusive statement of their terms and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative, or other legal proceeding to vary the terms of this Agreement.

 

7 

 

  f. Amendments; Waivers. This Agreement may not be modified, amended, or terminated except by an instrument in writing, signed by Executive and a duly authorized officer of Company. By an instrument in writing similarly executed, Executive or a duly authorized officer of the Company, as applicable, may waive compliance by the other Party with any specifically identified provision of this Agreement that such other Party was or is obligated to comply with or perform; provided, however, that such waiver shall not operate as a waiver of, or estoppel with respect to, any other or subsequent failure. No failure to exercise and no delay in exercising any right, remedy, or power hereunder preclude any other or further exercise of any other right, remedy, or power provided herein or by law or in equity.
     
  g. Arbitration. Executive and the Company agree that if any dispute, controversy or claim should arise between Executive and the Company (including claims against its employees, officers, directors, shareholders, agents, successors and assigns) relating or pertaining to or arising out of Executive’s employment with the Company or this Agreement, the dispute will be submitted exclusively to binding arbitration before a neutral arbitrator conducted in the state of Delaware, in accordance with the commercial rules of the American Arbitration Association then in force. This means that disputes will be decided by an arbitrator rather than a court or jury, and that both Executive and the Company waive their respective rights to a court or jury trial. Nothing in this Agreement is intended to prevent either Executive or the Company from obtaining injunctive relief in court to prevent irreparable harm pending the conclusion of any such arbitration. Notwithstanding anything herein to the contrary, Executive and the Company each have the right to resolve any issue or dispute over intellectual property rights by court action instead of arbitration.
     
  h. Withholding. The Company shall be entitled to withhold from any amounts payable under this Agreement (including, without limitation, any allowances and reimbursements) any federal, state, local or foreign withholding or other taxes or charges which the Company is required to withhold. The Company shall be entitled to rely on an opinion of counsel if any questions as to the amount or requirement of withholding shall arise.

 

  7. Section 409A.

 

  The intent of the Parties is that the payments and benefits under this Agreement be exempt from Section 409A of the Internal Revenue Code of 1986, as amended (collectively with the Department of Treasury regulations and other interpretive guidance issued thereunder, including without limitation any such regulations or other guidance that may be issued after the Effective Date, “Section 409A”), and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be exempt therefrom. If Executive notifies the Company that Executive has received advice of tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefor) or the Company independently makes such determination, the Company and Executive shall take commercially reasonable efforts to reform such provision to try to comply with or be exempt from Section 409A through good faith modifications to the minimum extent reasonably appropriate to conform with Section 409A, provided that any such modifications shall not increase the cost or liability to the Company. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A.

 

(Signature Page Follows)

 

8 

 

IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date and year first above written.

 

  SHARPLINK GAMING, INC.
     
  By: /s/ Obie McKenzie
     
  Name: Obie McKenzie, Director

 

  EXECUTIVE
     
  By: /s/ Robert Phythian
     
  Name: Robert Phythian

 

9 

 

 

 

 

EX-10.4 6 ex10-5.htm

 

Exhibit 10.5

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”) is entered into by and between SHARPLINK GAMING, INC. (the “Company”) and ROBERT DELUCIA (the “Executive”). The Company and the Executive may hereinafter be referred to jointly as the “Parties.”

 

WITNESSETH:

 

WHEREAS, the parties desire to enter into an employment agreement on the terms and conditions set forth herein;

 

WHEREAS, the Executive’s employment shall commence under this agreement on February 14, 2024 (the “Effective Date”).

 

WHEREAS, the Executive will serve as Chief Financial Officer of the Company and thus a key senior executive of the Company;

 

WHEREAS, the Company would like enter into a formal agreement with the Executive to set forth the terms of Executive’s employment and to provide for certain severance payments and other benefits in the event Executive’s employment is terminated by the Company without cause or by the Executive for “Good Reason” (as defined below); and

 

WHEREAS, Executive wishes to be employed by the Company and provide full-time services to the Company in return for the compensation and benefits detailed herein.

 

NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, including the agreements set forth below, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:

 

  1. Employment.

 

  a. Term. Subject to Section 4 hereof, the Company agrees to employ the Executive, and the Executive agrees to be employed by the Company for a period commencing on the Effective Date and ending on the second anniversary of the Effective Date (the “Initial Term”); provided however that the period of the Executive’s employment pursuant to this Agreement shall be automatically extended for successive one-year periods thereafter (each, a “Renewal Term”), in each case unless either Party hereto provides the other Party hereto with written notice that such period shall not be so extended at least one hundred and twenty (120) days in advance of the expiration of the Initial Term or the then-current Term, as applicable (the Initial Term and any Renewal Term, collectively, the “Term”). The Executive’s period of employment pursuant to this Agreement shall hereinafter be referred to as the “Employment Period.”
     
  b. Position and Duties. Executive (i) shall serve as the Chief Executive Officer of the Company with responsibilities, duties and authority customary for such position; (ii) shall report directly to the Board of Directors; (iii) shall devote substantially all Executive’s working time and efforts to the business and affairs of the Company and its subsidiaries; and (iv) agrees to observe and comply with the Company’s rules and policies as adopted by the Company from time to time. In addition, as of the Effective Date, the Executive shall retain his appointment as an executive member of the Board and the Company shall use commercially reasonable efforts to cause Executive to be reelected as a member of the Board while employed hereunder.

 

1

 

  c. Place of Employment. Executive shall perform the services required by this Agreement at his primary base of operations in Minneapolis, Minnesota. In addition, the Company may from time to time require Executive to travel temporarily to other locations on the Company’s business.

 

  2. Compensation and Related Matters.

 

  a. Annual Base Salary. Executive shall receive a base salary at the rate of $230,000 per annum (the “Annual Base Salary”), subject to withholdings and deductions and which shall be paid to Executive in accordance with the customary payroll practices and procedures of the Company. Such Annual Base Salary shall be reviewed by the Board’s Compensation Committee not less than annually and may be adjusted from time to time.
     
  b. Annual Bonus. Commencing in the calendar year 2024 and each calendar year thereafter during Executive’s employment with the Company, Executive will be eligible to receive a discretionary annual performance bonus, with a target achievement of up to 40.0% of the Annual Base Salary (the “Annual Bonus”). The amount of the Annual Bonus that shall be payable shall be based on the achievement of predetermined performance goals to be determined by the Board, in its sole discretion. The amount of any Annual Bonus for which Executive is eligible shall be reviewed by the Board from time to time, provided that that target achievement for the Annual Bonus shall not be less than up to 40% of the Annual Base Salary. Any Annual Bonus earned by Executive pursuant to this section shall be paid to Executive in accordance with Company policies, less authorized deductions and required withholding obligations, and is payable within 75 days following the end of the calendar year, ended December 31.
     
  c. Benefits. Executive shall participate in such full-time employee and executive benefit plans and programs as the Company may from time to time offer to senior executives of the Company, subject to the terms and conditions of such plans, including, without limitation, an executive family medical package.
     
  d. Life Insurance and Executive Health Exams. The Company shall directly pay or reimburse Executive for the premiums of a term life insurance policy and, if elected, executive health exams not covered by the Company’s prevailing benefits plan, up to a maximum of $10,000 annually. If Executive’s employment terminates for any or no reason, the Company shall have no obligation to continue to bear the costs of the life insurance policy for Executive, but Executive may choose to assume responsibility for payments required to continue the policy.
     
  e. Vacation. Executive shall be entitled to 30-days of paid time-off for vacation, as well as sick leave, holidays and other paid time-off benefits provided by the Company from time to time which are applicable to the Company’s executive officers in accordance with Company policy. The opportunity to take paid time off is contingent upon Executive’s workload and ability to manage his schedule.
     
  f. Business Expenses. The Company shall reimburse Executive for all reasonable, documented, out-of-pocket travel and other business expenses incurred by Executive in the performance of Executive’s duties to the Company in accordance with the Company’s applicable expense reimbursement policies and procedures as in effect from time to time.

 

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  3. Equity Awards.

 

  a. Restricted Stock Units. Subject to approval by the Board and pursuant to the provisions of the Company’s 2023 Equity Incentive Plan (the “Plan”), Executive shall be granted 80,000 Restricted Stock Units (“RSUs”) (the “Award”), with each RSU representing an unfunded, unsecured right for the Executive to receive one (1) share of the Company’s common stock. Subject to the terms of the Plan and the Restricted Stock Unit Award Agreement, including without limitation, fulfillment of the employment requirements set forth in Section 1 herein, the Award will vest in increments equal to 25% of the Award on March 31, 2024; June 30, 2024; September 30, 2024 and December 31, 2024.
     
  b. Additional Equity Awards. Executive shall be eligible to be granted additional equity awards in accordance with the Company’s policies as in effect from time to time, as recommended by the Compensation Committee and approved by the Board of Directors.

 

  4. Termination.

 

  a. Termination of Employment. The Company may terminate the Executive’s employment hereunder for any reason during the Term, and the Executive may voluntarily terminate his employment hereunder for any reason during the Term, in each case (other than a termination by the Company for Cause) at any time upon not less than 90-days notice to the other Party (the date on which the Executive’s employment terminates for any reason is herein referred to as the “Termination Date”). Upon the termination of the Executive’s employment with the Company for any reason, the Executive shall be entitled to (a) payment of any Base Salary earned but unpaid through the date of termination; (b) unused paid time off (consistent with Section 2.f. hereof) paid out at the per-business-day Base Salary rate; (c) additional vested benefits (if any) in accordance with the applicable terms of applicable Company arrangements; and (d) any unreimbursed expenses in accordance with Section 2.g. hereof (collectively, the “Accrued Amounts”). The Accrued Amounts described in Section 4.a. shall by paid to the Executive within 30 days following the Termination Date (or, if later, following the Executive’s presentation of supporting documentation for unreimbursed expenses in accordance with 2.g.).
     
  b. Termination by the Company other than for Cause, Death or Disability; Termination by the Executive for Good Reason. If the Executive’s employment is terminated (a) by the Company other than for Cause, death or Disability or (b) by the Executive for Good Reason, in addition to the Accrued Amounts, (i) the Executive shall be entitled to continuation of the Base Salary at the rate in effect immediately prior to the Termination Date for 12 months following the Termination Date paid in accordance with the Company’s normal payroll practices, but no less frequently than monthly (the “Base Salary Continuation”); and (ii) if the Executive elects to continue group health coverage under any Company group health plan pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), the Company shall reimburse the Executive for a portion of his COBRA premiums, such that his unreimbursed cost of COBRA premiums does not exceed the cost to the Executive of such health plan premiums immediately prior to termination, for a period of up to one year after his termination (or until he is no longer eligible for COBRA continuation, if sooner). Notwithstanding clause (ii) of the preceding sentence, such reimbursements for COBRA premiums shall not be made to the extent such payments would result in any additional tax or penalty to the Company under the Affordable Care Act or any other applicable law. In the event the group health coverage is self-insured, the Company shall include in the Executive’s gross income, the imputed value of the employer-subsidized COBRA premiums. The Executive shall be responsible for the full amount of COBRA premiums for any periods exceeding the time set forth above. In addition, in the event of a termination covered by this Section 4.b., the Executive shall be entitled to a lump sum payment equal to one hundred percent (100%) of his annual Base Salary (“Bonus Severance”). The Company’s obligations to pay the Base Salary Continuation, the Bonus Severance and COBRA premiums described above shall be conditioned upon the Executive’s continued compliance with his obligations under Section 4 of this Agreement. Notwithstanding any provision to the contrary herein, and without limitation of any remedies to which the Company may be entitled, the Base Salary Continuation shall be paid in equal installments commencing during the sixty (60) day period following the Termination Date, the Bonus Severance shall be paid during the sixty (60) day period following the Termination Date and the reimbursement of COBRA premiums shall be made after substantiation of such expenses; provided, that, the Executive has signed and delivered to the Company the release of claims substantially in the form attached hereto as Exhibits A and B (the “Release”) and the period (if any) during which the Release can be revoked has expired within such sixty (60) day period; provided, further, that, if such sixty (60) day period begins in one calendar year and ends in another calendar year, to the extent required under Section 409A (as defined below), payment of the Base Salary Continuation installments, Bonus Severance and reimbursement of the COBRA premiums that otherwise would have been paid during that sixty (60) day period shall be accumulated and paid in the second calendar year after expiration of the period for revoking the Release (but within the specified sixty (60) day period).

 

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  c. Voluntary Resignation by the Executive other than for Good Reason; Termination due to Death or Disability; Termination Due to, Upon or Following Non-Renewal of the Agreement. If (a) the Executive voluntarily terminates his employment at any time, other than for Good Reason, (b) if the Executive’s employment is terminated due to the Executive’s death or Disability or (c) if the Executive’s employment terminates due to, upon or following non-renewal of the Agreement by either Party in accordance with Section 1.a., then the Executive (or his estate) shall be entitled to no payment or compensation whatsoever from the Company under this Agreement, other than the Accrued Amounts.
     
  d. Termination by the Company for Cause. If the Company terminates the Executive’s employment for Cause, then the Executive shall be entitled to no payment or compensation whatsoever from the Company under this Agreement, other than the Accrued Amounts.
     
  e. Exclusive Remedy. The foregoing payments upon termination of the Executive’s employment shall constitute the exclusive severance payments and benefits due the Executive upon termination of his employment.
     
  f. Resignation from All Positions. Upon the termination of the Executive’s employment with the Company for any reason, the Executive shall resign, as of the Termination Date, from all positions he then holds as an officer, director, employee and member of the boards of directors (and any committee thereof) of the Board, if applicable. The Executive shall be required to execute such writings as are required to effectuate the foregoing.
     
  g. Cooperation. Following the termination of the Executive’s employment with the Company for any reason, the Executive shall reasonably cooperate with the Company upon reasonable request of the Board and be reasonably available to the Company (taking into account any other full-time employment of the Executive) with respect to matters arising out of the Executive’s services to the Company.

 

4

 

  h. Duty of Confidentiality. Executive agrees that during employment with the Company and for a period of two (2) years following the termination or resignation of Executive from employment with the Company, Executive shall not, directly or indirectly, divulge or make use of any Confidential Information of the Company other than in the performance of Executive’s duties for the Company. While employed by the Company, Executive shall make all reasonable efforts to protect and maintain the confidentiality of the Confidential Information of the Company. In the event that Executive becomes aware of unauthorized disclosures of the Confidential Information by anyone at any time, whether intentionally or by accident, Executive shall promptly notify the Company. This Agreement does not limit the remedies available to the Company under common or statutory law as to trade secrets or other types of confidential information, which may impose longer duties of non-disclosure.
     
  i. Return of Property and Information. Executive agrees not to remove any Company property from Company premises, except when authorized by the Company. Executive agrees to return all Company property and information (whether confidential or not) within Executive’s possession or control within seven (7) calendar days following the termination or resignation of Executive from employment with the Company. Such property and information includes, but is not limited to, the original and any copy (regardless of the manner in which it is recorded) of all information provided by Company to Executive or which Executive has developed or collected in the scope of Executive’s employment with the Company, as well as all Company-issued equipment, supplies, accessories, vehicles, keys, instruments, tools, devices, computers, cell phones, pagers, materials, documents, plans, records, notebooks, drawings, or papers. Upon request by the Company, Executive shall certify in writing that Executive has complied with this provision; and has permanently deleted all Company information from any computers or other electronic storage devices or media owned by Executive. Executive may only retain information relating the Executive’s benefit plans and compensation to the extent needed to prepare Executive’s tax returns.
     
  j. Assignment of Work Product and Inventions. Executive hereby assigns and grants to the Company (and will upon request take any actions needed to formally assign and grant to Company and/or obtain patents, trademark registrations or copyrights belonging to Company) the sole and exclusive ownership of any and all inventions, information, reports, computer software or programs, writings, technical information or work product collected or developed by Executive, alone or with others, during the term of Executive’s employment relating to the Company. This duty applies whether or not the forgoing inventions or information are made or prepared in the course of employment with the Company, so long as such inventions or information relate to the Business of Company and have been developed in whole or in part during the term of Executive’s employment. Executive agrees to advise the Company in writing of each invention that Executive, alone or with others, makes or conceives during the term of Executive’s employment and which relate to the Business of Company. Notwithstanding any provision of this Agreement, Executive shall not be required to assign, nor shall Executive be deemed to have assigned, any of Executive’s rights in any invention that Executive develops entirely on his own time without using Company’s equipment, supplies, facilities, or Trade Secrets, except for inventions that either: (1) relate, at the time that the invention is conceived or reduced to practice, to the Business of Company or to actual or demonstrably anticipated research or development of the Company; or (2) result from any work performed by Executive for the Company on behalf of the Company. Inventions which Executive developed before Executive came to work for the Company, if any, are described in the attached Exhibit B, and excluded from this Section. The failure of the parties to attach any Exhibit B to this agreement shall be deemed an admission by Executive that Executive does not have any pre-existing inventions.

 

5

 

  k. Non-Competition. Executive agrees that during the Restricted Period, and within the Restricted Territory, Executive shall not, directly or indirectly, whether on Executive’s own behalf or on behalf of any other person or entity, perform services on behalf of a Competing Business, and which are the same as or similar to those types of services conducted, authorized, offered, or provided by Executive to the Company within 24 months prior to Executive’s termination or resignation.
     
  l. Non-Recruitment of Company Employees and Contractors. Executive agrees that during the Restricted Period, Executive shall not, directly or indirectly, whether on Executive’s own behalf or on behalf of any other person or entity, solicit or induce any employee or independent contractor of the Company with whom Executive had Material Contact, to terminate or lessen such employment or contract with the Company.
     
  m. Non-Solicitation of Company Customers. Executive agrees that during the Restricted Period, Executive shall not, directly or indirectly, whether on Executive’s own behalf or on behalf of any other person or entity, solicit any actual or prospective customers of the Company with whom Executive had Material Contact, for the purpose of selling any products or services to such customers on behalf of a Competing Business.
     
  n. Non-Solicitation of Company Vendors. Executive agrees that during the Restricted Period, Executive shall not, directly or indirectly, whether on Executive’s own behalf or on behalf of any other person or entity, solicit any actual or prospective Vendor of the Company with whom Executive had Material Contact, for the purpose of purchasing products or services to support a Competing Business.
     
  o. Acknowledgements. Executive acknowledges and agrees that the provisions of Section 4 are reasonable as to time, scope and territory given the Company’s need to protect its Confidential Information and its relationships and goodwill with its customers, suppliers, employees and contractors, all of which have been developed at great time and expense to the Company. Executive represents that Executive has the skills and abilities to obtain alternative employment that would not violate these Restrictive Covenants in the event that Executive leaves employment with the Company, and that these Restrictive Covenants do not pose an undue hardship on Executive. Executive further acknowledges that Executive’s breach of any of the provisions of Section 4 would likely cause irreparable injury to the Company, and therefore entitle the Company to injunctive relief, in addition to any other remedies available in law or equity, without the necessity of posting a bond.

 

  5. Assignment and Successors.

 

The Company may assign its rights and obligations under this Agreement to any successor to all or substantially all of the business or the assets of the Company (by merger or otherwise), and may assign or encumber this Agreement and its rights hereunder as security for indebtedness of the Company and its affiliates. This Agreement shall be binding upon and inure to the benefit of the Company, Executive and their respective successors, assigns, personnel and legal representatives, executors, administrators, heirs, distributees, devisees, and legatees, as applicable. None of Executive’s rights or obligations may be assigned or transferred by Executive, other than Executive’s rights to payments hereunder, which may be transferred only by will or operation of law.

 

6

 

  6. Miscellaneous Provisions.

 

  a. Work Eligibility; Confidentiality Agreement. As a condition of Executive’s employment with the Company, Executive will be required to provide evidence of Executive’s identity and eligibility for employment in the United States. It is required that Executive bring the appropriate documentation with Executive at the time of employment. As a further condition of Executive’s employment with the Company, Executive shall enter into and abide by the Company’s standard Proprietary Information and Inventions Assignment Agreement (the “Confidential Information Agreement”).
     
  b. Validity. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect. All questions concerning the construction, validity and interpretation of this Agreement will be governed by the laws of the State of Delaware without regard to the conflicts of law provisions thereof.
     
  c. Notices. Any notice, request, claim, demand, document and other communication hereunder to any Party shall be effective upon receipt (or refusal of receipt) and shall be in writing and delivered personally or sent by facsimile or certified or registered mail, postage prepaid (or if it is sent through any other method agreed upon by the parties), as follows:

 

  (i) If to the Company at:
    SharpLink Gaming, Inc.
    333 Washington Avenue North
    Suite 104
    Minneapolis, Minnesota 55401
     
  (ii) If to Executive, at the address set forth on Exhibit D.
     
  (iii) Or at any other address as any Party shall have specified by notice in writing to the other Party.

 

  d. Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, but all of which together will constitute one and the same Agreement. Signatures delivered by facsimile shall be deemed effective for all purposes.
     
  e. Entire Agreement. The terms of this Agreement, collectively with the Change in Control and Severance Agreement and the Confidential Information Agreement, is intended by the Parties to be the final expression of their agreement with respect to the employment of Executive by the Company and supersede all prior understandings and agreements, whether written or oral. The Parties further intend that this Agreement, collectively with the Change in Control and Severance Agreement and the Confidential Information Agreement, shall constitute the complete and exclusive statement of their terms and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative, or other legal proceeding to vary the terms of this Agreement.

 

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  f. Amendments; Waivers. This Agreement may not be modified, amended, or terminated except by an instrument in writing, signed by Executive and a duly authorized officer of Company. By an instrument in writing similarly executed, Executive or a duly authorized officer of the Company, as applicable, may waive compliance by the other Party with any specifically identified provision of this Agreement that such other Party was or is obligated to comply with or perform; provided, however, that such waiver shall not operate as a waiver of, or estoppel with respect to, any other or subsequent failure. No failure to exercise and no delay in exercising any right, remedy, or power hereunder preclude any other or further exercise of any other right, remedy, or power provided herein or by law or in equity.
     
  g. Arbitration. Executive and the Company agree that if any dispute, controversy or claim should arise between Executive and the Company (including claims against its employees, officers, directors, shareholders, agents, successors and assigns) relating or pertaining to or arising out of Executive’s employment with the Company or this Agreement, the dispute will be submitted exclusively to binding arbitration before a neutral arbitrator conducted in the state of Delaware, in accordance with the commercial rules of the American Arbitration Association then in force. This means that disputes will be decided by an arbitrator rather than a court or jury, and that both Executive and the Company waive their respective rights to a court or jury trial. Nothing in this Agreement is intended to prevent either Executive or the Company from obtaining injunctive relief in court to prevent irreparable harm pending the conclusion of any such arbitration. Notwithstanding anything herein to the contrary, Executive and the Company each have the right to resolve any issue or dispute over intellectual property rights by court action instead of arbitration.
     
  h. Withholding. The Company shall be entitled to withhold from any amounts payable under this Agreement (including, without limitation, any allowances and reimbursements) any federal, state, local or foreign withholding or other taxes or charges which the Company is required to withhold. The Company shall be entitled to rely on an opinion of counsel if any questions as to the amount or requirement of withholding shall arise.

 

  7. Section 409A.

 

The intent of the Parties is that the payments and benefits under this Agreement be exempt from Section 409A of the Internal Revenue Code of 1986, as amended (collectively with the Department of Treasury regulations and other interpretive guidance issued thereunder, including without limitation any such regulations or other guidance that may be issued after the Effective Date, “Section 409A”), and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be exempt therefrom. If Executive notifies the Company that Executive has received advice of tax counsel of a national reputation with expertise in Section 409A that any provision of this Agreement would cause Executive to incur any additional tax or interest under Section 409A (with specificity as to the reason therefor) or the Company independently makes such determination, the Company and Executive shall take commercially reasonable efforts to reform such provision to try to comply with or be exempt from Section 409A through good faith modifications to the minimum extent reasonably appropriate to conform with Section 409A, provided that any such modifications shall not increase the cost or liability to the Company. To the extent that any provision hereof is modified in order to comply with or be exempt from Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision without violating the provisions of Section 409A.

 

(Signature Page Follows)

 

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IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date and year first above written.

 

  SHARPLINK GAMING, INC.
     
  By: /s/ Rob Phythian
     
  Name: Rob Phythian, Chief Executive Officer
     
  EXECUTIVE
     
  By: /s/ Robert DeLucia
     
  Name: Robert DeLucia

 

9

EX-99.1 7 ex99-1.htm

 

Exhibit 99.1

 

 

 

SharpLink Gaming Announces Board and Audit Committee Changes

 

Company Welcomes Sports, Entertainment and Media Icon,

Robert Gutkowski, to Board of Directors

 

MINNEAPOLIS – (GLOBE NEWSWIRE) – February 21, 2024 – SharpLink Gaming, Inc. (Nasdaq: SBET) (“SharpLink” or the “Company”) today announced recent changes to its Board of Directors (the “Board”) and Audit Committee.

 

On February 16, 2024, the Board accepted the resignation of Adrienne Anderson as a director, Chair of the Audit Committee and member of the Compensation Committee, effective February 16, 2024. The resignation of Anderson was not the result of any disagreement with the Company, its management, the Board or any committee of the Board. The Board subsequently elected Leslie Bernhard, a current member of the Board, to serve as the new Chairperson of the Audit Committee, effective February 16, 2024.

 

In addition, the Board elected Robert Gutkowski as a new director and appointed him to serve as a member of the Audit and Compensation Committees, effective immediately.

 

Over a career spanning more than five decades, Gutkowski has proven to be a significant asset builder in the sports, entertainment and media industries. Among his key achievements was the landmark New York Yankees-Madison Square Garden Network $486 million cable distribution deal. This transaction forever changed the sports economic landscape, increased the value of the MSG Network by nearly 2,000%, and enabled the Yankees to dominate Major League Baseball media during the past two decades. In addition, he was the original architect behind radio entrepreneur Bob Sillerman’s roll-up of regional, independent concert promoters, which created SFX Entertainment – the first nationwide, vertically-integrated, concert promotion company widely recognized for transforming the multi-billion dollar live music concert industry.

 

From October 2014 through the present, Gutkowski has led RMG Sports Ventures LLC, a company he founded to originate and advise private equity and other institutional capital on investments in sports, entertainment and media. He recently co-originated the acquisition of True Temper Sports (the largest producer of golf shafts in the world) for Lincolnshire Management and made a substantial investment alongside Lincolnshire in True Temper.

 

In December 1991, Gutkowski was named President of Madison Square Garden, where he was responsible for the operations of the New York Knicks basketball team; the New York Rangers hockey team – which won the 1994 Stanley Cup Championship; MSG Communications - including the MSG Network, the nation’s largest regional cable network; MSG Entertainment and the MSG Facilities Group, which operated The Garden Arena and The Paramount Theater. He originally joined Madison Square Garden in 1985 and over the next six years held various senior executive positions, including President of the MSG Network. Under his leadership, the subscriber base of the MSG Network – the oldest and largest regional sports network in the country – more than doubled to 5.1 million subscribers. The Yankees, together with the New York Knicks and the New York Rangers, became the foundations of MSG Network’s year-round operation. In 1993 and 1994, the Garden was the most active building in the country in bookings and revenues and was named “Arena of the Year” by Pollstar Magazine.

 

In 1996, Gutkowski founded The Marquee Group, a worldwide sports and entertainment firm that managed, produced and marketed sports and entertainment events, as well as provided representation for athletes, entertainers and broadcasters. The Marquee Group, which became a public company in 1996, acquired many related companies, including Athletes and Artists, Sports Marketing and Television International, QBQ Entertainment, Tollin-Robbins Productions, Park Associates, Alphabet City Records, Cambridge Golf and ProServ, before being acquired by SFX Entertainment in 1999 for over $100 million.

 

    Page 1 of 2

 

Gutkowski is a graduate of Hofstra University, where he earned a Bachelor of Business Administration degree.

 

Commenting on the Board changes, Rob Phythian, Chairman and CEO of SharpLink, stated, “There are no words to adequately express our appreciation to Adrienne for the sound and thoughtful guidance and support she has provided our leadership while serving as a director on the board of SharpLink Gaming, Ltd. since July 2021. I’m also very pleased to welcome new director Bob Gutkowski to our team. A true industry visionary renowned for his strategic brilliance, love of sports and big league deal-making success, Bob is an incredible addition to our Board and is a director whose experience will undoubtedly prove invaluable to SharpLink as we move our Company forward.”

 

About SharpLink Gaming, Inc.

 

Headquartered in Minneapolis, Minnesota, SharpLink is an online performance marketing company that delivers unique fan activation solutions to its sportsbook and casino partners. Through its iGaming and affiliate marketing network, known as PAS.net, SharpLink focuses on driving qualified traffic and player acquisitions, retention and conversions to U.S. regulated and global iGaming operator partners worldwide. In fact, PAS.net won industry recognition as the European online gambling industry’s Top Affiliate Website and Top Affiliate Program for four consecutive years by both igamingbusiness.com and igamingaffiliate.com. For more information, please visit www.sharplink.com.

 

Forward-Looking Statements

 

This release contains forward-looking statements that are subject to various risks and uncertainties. Such statements include statements regarding SharpLink’s ability to grow its business and other statements that are not historical facts, including statements which may be accompanied by the words “intends,” “may,” “will,” “plans,” “expects,” “anticipates,” “projects,” “predicts,” “estimates,” “aims,” “believes,” “hopes,” “potential” or similar words. Actual results could differ materially from those described in these forward-looking statements due to certain factors, including without limitation, SharpLink’s ability to achieve profitable operations, government regulation of online betting, customer acceptance of new products and services, the demand for its products and its customers’ economic condition, the impact of competitive products and pricing, the lengthy sales cycle, proprietary rights of SharpLink and its competitors, general economic conditions and other risk factors detailed in SharpLink’s filings with the SEC. SharpLink does not undertake any responsibility to update the forward-looking statements in this release.

 

CONTACT INFORMATION:

 

INVESTOR AND MEDIA RELATIONS

ir@sharplink.com

 

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