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AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT

Employee Retention Agreement

AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT | Document Parties: GAMESTOP CORP. You are currently viewing:
This Employee Retention Agreement involves

GAMESTOP CORP.

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Title: AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT
Date: 1/7/2009
Industry: Retail (Technology)     Sector: Services

AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT, Parties: gamestop corp.
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Exhibit 10.5

 

AMENDED AND RESTATED

EXECUTIVE EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “Agreement”) was originally entered into between Tony Bartel (“Executive”) and GameStop Corp. (the “Company”), collectively referred to as the “Parties,” with an “Original Effective Date” of October 24, 2008 and is amended and restated as of the 31 st day of December, 2008.

The Company has administered this Agreement in good faith compliance with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (“Code”), and the regulations and other guidance promulgated thereunder, and the Parties wish to amend this employment agreement to comply with the requirements of Code Section 409A. Therefore, this Agreement is amended and restated to read as follows:

1.                    Executive’s Position/Duties . During the term of this Agreement, Executive will be employed as the Executive Vice President – Merchandising and Marketing of the Company, and shall have all of the duties and responsibilities of that position. Executive shall be considered a key employee of the Company and shall be entitled to all the Company benefits afforded to key employees. Executive agrees to dedicate all of his working time (during normal working hours other than during excused absences such as for illness or vacation), skill and attention to the business of the Company, agrees to remain loyal to the Company, and not to engage in any conduct that creates a conflict of interest to, or damages the reputation of, the Company. Executive shall abide by the Company’s Code of Ethics and Code of Ethics for Senior Financial Officers.

2.              Term of Employment . Executive’s employment under this Agreement will commence on the Original Effective Date, and will continue for a period of three years, unless terminated earlier in accordance with the provisions of this Agreement. At the expiration (but not earlier termination) of the term (including any renewal term), the term of this Agreement shall automatically renew for an additional period of one year, unless either party has given the other party written notice of non-renewal at least six months prior to such expiration.

3.

Compensation .

a.          Base Salary . During the term of this Agreement, the Company shall provide Executive with a base salary of no less than four hundred thousand dollars ($400,000.00) per year, paid in accordance with the Company’s normal payroll policies (“Base Salary”).

b.          Bonuses/Distributions . Each year during the term of this Agreement, the Company shall provide Executive with a bonus based on the formula and targets established under and in accordance with the Company’s Supplemental Compensation Plan. Executive may receive additional bonuses at the discretion of the Board of Directors of the Company (the “Board”).

c.          Benefits . Executive shall be entitled to all benefits, including, but not limited to, stock and stock option benefits, insurance programs, pension plans, vacation, sick leave, expense

accounts, and retirement benefits, as afforded other management personnel or as determined by the Board.

d.          Expenses . The Company shall reimburse Executive for reasonable expenses incurred in the performance of his duties and services hereunder and in furtherance of the business of the Company, in accordance with the policies and procedures established by the Company.

e.          Reimbursement of Expenses . Notwithstanding any provision in this Section 3 to the contrary, no expenses incurred after the term of this Agreement shall be subject to reimbursement, except to the extent provided under this Section 3(e). The amount of expenses eligible for reimbursement during a year shall not affect the expenses eligible for reimbursement in any other year. Reimbursement of an eligible expense shall be made in accordance with the Company’s policies and practices and as otherwise provided herein, provided that in no event shall reimbursement be made after the last day of the year following the year in which the expense was incurred. The right to reimbursement is not subject to liquidation or exchange for another benefit.

4.           Termination of Employment . Executive’s employment with the Company may be terminated as follows:

a.          Death . In the event of Executive’s death, Executive’s employment will be terminated immediately.

b.          Disability . In the event of Executive’s Disability, as defined below, Executive’s employment will be terminated immediately. “Disability” shall mean a written determination by a physician mutually agreeable to the Company and Executive (or, in the event of Executive’s total physical or mental disability, Executive’s legal representative) that Executive is physically or mentally unable to perform his duties of Executive Vice President – Merchandising and Marketing under this Agreement and that such disability can reasonably be expected to continue for a period of six consecutive months or for shorter periods aggregating 180 days in any 12-month period.

c.          Termination by the Company for Cause . The Company shall be entitled to terminate Executive’s employment at any time if it has “Cause,” which shall mean any of the following: (i) conviction of, or plea of nolo contendere to, a felony or any crime involving fraud or dishonesty; (ii) willful misconduct that results in a material and demonstrable damage to the business or reputation of the Company; (iii) breach by Executive of any of the covenants contained in Sections 8, 10(c), 10(d) or 10(e) below; or (iv) willful refusal by Executive to perform his obligations under this Agreement or the lawful direction of the Board that is not the result of Executive’s death, Disability, physical incapacity or Executive’s termination of the Agreement, and that is not corrected within thirty (30) days following written notice thereof to Executive by the Company, such notice to state with specificity the nature of the willful refusal.

d.          Without Cause . Either the Company or Executive may terminate Executive’s employment at any time without cause upon written notice.

 

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e.          Termination by Executive with Good Reason. Executive shall be entitled to terminate his employment within 12 months after any of the following events (each of which shall constitute “Good Reason”):

 

(i)

a material diminution in Executive’s compensation;

(ii)       a material diminution in Executive’s authority, duties, or responsibilities; or

(iii)      the Company requires Executive to move to another location of the Company or any affiliate of the Company and the distance between Executive’s former residence and new job site is at least 50 miles greater than the distance between Executive’s former residence and former job site.

Notwithstanding the foregoing, Executive shall notify Company in writing if he believes Good Reason exists. Such notice shall set forth in reasonable detail why Executive believes Good Reason exists and shall be provided to the Company within a period not to exceed 90 days of the initial existence of the condition alleged to give rise to Good Reason, upon the notice of which the Company shall have a period of 30 days during which it may remedy the condition.

f.          Termination by Executive Following a Change in Control. Following a Change in Control of the Company, Executive shall be entitled to terminate his employment within 30 days following the later of the end of the calendar year within which such Change in Control occurs or the end of the taxable year of the Company within which such Change in Control occurs (such date, the “CIC Termination Date”). For purposes of this Agreement, a “Change in Control” of the Company shall be deemed to have occurred upon the occurrence of one of the following events, provided such event constitutes a change in control under Section 409A of the Code and the regulations and other guidance issued thereunder:

(i)        Any one person or more than one person acting as a group (as defined in accordance with Section 409A of the Code and the regulations and other guidance issued thereunder), acquires ownership of stock of the Company that, together with stock held by such person or group, constitutes greater than fifty percent (50%) of the total fair market value or total voting power of the stock of the Company;

(ii)       Any one person or more than one person acting as a group (as defined in accordance with Section 409A of the Code and the regulations and other guidance issued thereunder), acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the Company possessing 30% or more of the total voting power of the stock of such Company; or a majority of the individuals constituting the Board is replaced during any 12-month period by members whose appointment or election is not endorsed by a majority of the members of the Board prior to the date of the appointment or election; or

(iii)      Any one person or more than one person acting as a group (as defined in accordance with Section 409A of the Code and the regulations and other guidance issued

 

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thereunder), acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the Company that have a total gross fair market value equal to or more than 40% of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions. For this purpose, gross fair market value means the value of the assets of the Company or the value of the assets being disposed of determined without regard to any liabilities associated with such assets.

5.

Compensation and Benefits Upon Termination .

a.         If Executive’s employment is terminated by reason of death or Disability, the Company shall pay Executive’s Base Salary, at the rate then in effect, in accordance with the payroll policies of the Company, through the date of Executive’s death or Disability (in the event of Executive’s death, the payments will be made to Executive’s beneficiaries or legal representatives) and Executive shall not be entitled to any further Base Salary or any applicable bonus, benefits or other compensation for that year or any future year, except as may be provided in an applicable benefit plan or program, or to any severance compensation of any kind, nature or amount.

b.         If Executive’s employment is terminated by Executive (i) without Good Reason or (ii) other than by the CIC Termination Date following a Change in Control; or by the Company for Cause, the Company will pay to Executive all Base Salary, at the rate then in effect, through the date of Executive’s termination of active employment and Executive shall not be entitled to any further Base Salary or any applicable bonus, benefits or other compensation for that year or any future year, except as may be provided in an applicable benefit plan or program, or to any severance compensation of any kind, nature or amount.

c.         If, during the term of this Agreement, (i) Executive terminates his employment for Good Reason, provided that such termination is within 12 months following the initial existence of one or more conditions giving rise to Good Reason; (ii) Executive terminates his employment by the CIC Termination Date following a Change in Control; or (iii) the Company terminates Executive’s employment without Cause, the Company will pay to Executive all amounts otherwise payable under this Agreement, at the rate then in effect, through the date of Executive’s termination, and the following paragraphs (i) through (vi) shall apply:

(i)         Base Salary and Payment Schedule . The Company shall pay Executive an amount equal to the greater of: (A) Executive’s Base Salary, at the rate then in effect, otherwise payable through the term of this Agreement; or (B) Executive’s Base Salary, at the rate then in effect, for one year. Such payment shall be made to Executive in a lump sum within 30 days following the date of Executive’s termination of employment.

(ii)        Bonus . The Company shall pay Executive an amount equal to the average of the Executive’s last three (3) gross annual bonuses multiplied by the greater of (A) one or (B) the number of years (including any fraction thereof) otherwise remaining through the term of this Agreement. Such payment shall be made to Executive in a lump sum within 30 days following the date of Executive’s termination of employment.

 

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(iii)       Medical Benefits . Upon Executive’s termination, Executive will be eligible to elect individual and dependent continuation group health and (if applicable) dental coverage, as provided under Section 4980B(f) of the Code (“COBRA”), for the maximum COBRA coverage period available, subject to all conditions and limitations (including payment of premiums and cancellation of coverage upon obtaining duplicate coverage or Medicare entitlement). If Executive or one or more of Executive’s covered dependents is eligible for and elects COBRA coverage, then the Company shall pay the full cost of the COBRA coverage for the eighteen (18) month period following Executive’s termination date. Executive (or dependents, as applicable) shall be responsible for paying the full cost of the COBRA coverage (including the two percentage administrative charge) after the earlier of (A) the expiration of eighteen months following Executive’s termination date, or (B) eligibility for coverage under another employer’s medical plan.

(iv)       Vacation . Executive shall be entitled to a payment attributable to Base Salary, at the rate then in effect, for unused vacation accrued. Such payment shall be made to Executive in a lump sum within 30


 
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