HYDRA INDUSTRIES ACQUISITION CORP. (NASDAQ:HDRA) Files An 8-K Other Events

HYDRA INDUSTRIES ACQUISITION CORP. (NASDAQ:HDRA) Files An 8-K Other Events

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Item 8.01

Other Events.

On December 14, 2016, Hydra Industries Acquisition Corp. (Hydra
Industries or the Company) entered into an employment agreement,
to become effective upon the closing of the Companys proposed
business combination with Inspired Gaming Group (the Business
Combination) (which is more fully described in the Companys Proxy
Statement filed with the Securities and Exchange Commission on
November 23, 2016 (the Proxy Statement)), with Daniel B. Silvers,
to join the Company as Chief Strategy Officer upon completion of
the Business Combination.

Under the terms of his employment agreement, Mr. Silvers annual
base salary will be $350,000, with a target annual bonus of not
less than 100%, and a maximum annual bonus of not more than 200%,
of his annual base salary, subject to applicable performance
goals. Mr. Silvers will be eligible to receive additional
incentive bonuses and equity on terms that are no less favorable
than those offered to any other executive of the Company except
the Chief Executive Officer and Executive Chairman. Mr. Silvers
employment agreement does not have a set term. The employment
agreement may be terminated without cause on three months written
notice by either party. Upon termination by the Company without
cause (as defined), Mr. Silvers would be entitled to (i) any
earned, but unpaid, annual bonus with respect to the year prior
to the year in which the termination occurred, (ii) a pro-rated
maximum annual bonus for the year in which the termination
occurred, (iii) his salary for the two-year period following the
termination date (or three years if termination occurs within two
years immediately following the commencement date of the
agreement or any change in control, as defined), (iv) two times
his maximum annual bonus (or three times if termination occurs
within two years immediately following the commencement date of
the agreement or any change in control) and (v) acceleration of
100% vesting of all incentive and equity compensation to which he
is entitled at the termination date (or in the case of any award
under the Companys 2016 Equity Incentive Plan, such award shall
not be forfeited upon such termination, but shall remain subject
to the time, performance or other conditions to vesting specified
in such award).

Mr. Silvers may be terminated by the Company immediately upon
written notice for cause (defined as (i) a serious or persistent
material breach of the terms of the employment agreement, (ii)
gross negligence or willful gross misconduct with a material
adverse effect on the Company, (iii) conviction of, or a plea of
guilty or nolo contendere to, a felony (other than a
traffic-related offense) or (iv) any material breach of the
employment agreement that has a material adverse effect on the
Company). In such instance, the Company would be obligated to pay
to Mr. Silvers (i) any accrued but unpaid salary, (ii) any earned
and vested benefits and (iii) any unreimbursed business expenses.

On the occurrence of an event constituting good reason as
defined, Mr. Silvers may terminate the agreement immediately at
any time within 90 days of such event. On termination for good
reason, Mr. Silvers is entitled to the payments applicable to a
termination by the Company without cause. Under the employment
agreement, Mr. Silvers will remain subject to certain covenants,
including, among other things, a covenant not to enter into a
competing business, for a period of time after termination of his
employment, as well as a covenant not to disclose certain
confidential information of the Company. The Company has also
agreed to make consulting payments to Matthews Lane Capital
Partners LLC, of which Mr. Silvers is a principal, in the amount
of $500,000 for consulting services previously provided (the
Consulting Payment). At least 50% of the Consulting Payment will
be paid on January 3, 2017, with the Company permitted to defer
the payment of the remaining portion through the first
anniversary of the closing of the Business Combination (subject
to accelerated payment under certain circumstances in the event
of termination of Mr. Silvers employment with the Company).

Mr. Silvers employment agreement calls for a grant to the
Companys 2016 Equity Incentive Plan (the Plan), subject to
approval of the Plan by the Companys stockholders, of restricted
stock, and in the amount of 150,000 shares. The grant of
restricted stock will be effective January 1, 2017 subject to the
closing of the Business Combination and Mr. Silvers continued
employment by the Company on January 1, 2017.

In addition, the vesting of such award is subject to the
conditions set forth on Annex A to the Plan, which is included as
an Annex to the Proxy Statement. One-third of such award will
vest on the first anniversary of the closing of the Business
Combination, provided that a period of at least 30 consecutive
trading days has elapsed during which the average of the closing
prices of the Companys common stock was equal to or greater than
$12.50 per share; another one-third of such award will vest on
the second anniversary of the closing of the Business
Combination, provided that for a period of at least 30
consecutive trading days such average of the closing prices was
equal to or greater than $15.00 per share; and the final
one-third of such award will vest on the third anniversary of the
closing of the Business Combination, provided that for a period
of at least 30 consecutive trading days such average of the
closing prices was equal to or greater than $17.50 per share. If
a specified price threshold applicable to any anniversary date
has not been achieved prior to such date, the portion of the
award subject to that price threshold will vest on the first date
thereafter when that price threshold is achieved.


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