EMPLOYMENT AGREEMENT
This
EMPLOYMENT
AGREEMENT
(the
“Agreement”)
is
dated and effective as of September 14, 2008, by and between Napster, Inc.,
a
Delaware corporation, (“Employer”)
and
[_________], an individual resident of the State of California (“Employee”).
RECITALS:
A. Best
Buy
Co., Inc., a Minnesota corporation (“Best
Buy”),
Puma
Cat Acquisition Corp., a Delaware corporation and a wholly-owned subsidiary of
Best
Buy (“Merger
Sub”)
and
Employer have entered into an Agreement and Plan of Merger, dated as of even
date herewith (the “Merger
Agreement”),
pursuant to which Best Buy will acquire Employer by merging Merger Sub with
and
into Employer, with Employer continuing as the surviving corporation and a
wholly-owned subsidiary of Best Buy (the “Merger”).
B. Following
the closing of the Merger, Best Buy and Employer desire to continue to employ
Employee, and Employee desires to continue his employment with Employer, all
in
accordance with the terms hereof.
C. Employer
and Employee are entering into this Agreement, which provides for the terms
and
conditions of Employee’s employment and replaces and supersedes in all respects
Employee’s Existing Agreement (as defined below), expressly subject to, and
effective solely upon, the closing of the Merger.
NOW,
THEREFORE,
in
consideration of the foregoing and the mutual agreements herein contained,
Employer and Employee agree as follows:
1.
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Definitions.
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1.1.
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“Affiliate”
means any present or future entity that controls, is controlled by,
or is
under common control with Employer as of the applicable time. For
purposes
of this Agreement, Affiliate includes Best Buy, and any action that
can or
may be taken by Employer or Employer’s Board of Directors may also be
taken by Best Buy, whether or not so expressly stated, and Best Buy
is an
intended third party beneficiary of, and will be entitled to enforce
the
provisions of, this Agreement.
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1.2.
|
“Cause”
for termination of Employee’s employment with Employer means the
occurrence of one or more of the following
events:
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1.2.1.
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Dishonesty
in the performance of Employee’s duties for Employer or its Affiliates;
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1.2.2.
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Knowing
and material violation of Employer’s policies and procedures in effect
from time to time which results in a material adverse effect on Employer
and which, to the extent a cure is reasonably possible, remains uncured
ten (10) days after written notice of such violation is given to
Employee;
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1.2.3.
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Willful
and continued failure to satisfactorily perform, or gross negligence
in
the performance of, Employee’s duties after receipt of written notice that
specifically identifies the areas in which Employee’s performance is
deficient and which remains uncured thirty (30) days after such written
notice is given to Employee;
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1.2.4.
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Willful
actions (or willful failures to act) in bad faith by Employee with
respect
to Employer that materially impair Employer’s business, goodwill or
reputation;
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1.2.5.
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Employee’s
conviction of a felony or any crime involving an act of dishonesty,
moral
turpitude, deceit or fraud, or the commission of acts that would
reasonably be expected to result in such
conviction;
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1.2.6.
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Employee’s
current use of illegal substances;
or
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1.2.7.
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any
material violation by Employee of any agreement to which Employee
and
Employer or any Affiliate of Employer are parties which remains uncured
ten (10) days after written notice of such violation is given to
Employee.
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In
the
event that there exists Cause (as defined above) for termination of Employee’s
employment, Employer may terminate Employee’s employment and this Agreement
immediately, upon written notification of such termination for Cause, given
to
Employee by Employer or by any individual or individuals Employer authorizes
to
act on its behalf.
1.3.
|
“Code”
means the U.S. Internal Revenue Code of 1986, as
amended.
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1.4.
|
“Disability”
shall have the same meaning as ascribed to such term in Employer’s
disability income insurance program, as the same may be amended or
modified from time to time. The determination of whether a Disability
exists shall be made by the same entity as has been designated in
said
program to make such determinations for purposes of said
program.
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1.5.
|
“Effective
Date”
means the date of the closing of the
Merger.
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1.6.
|
“Existing
Agreement”
means that certain Employment Agreement, dated as of [__________],
by and
between Employer and Employee, including all exhibits, agreements
and
plans referred to therein.
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1.7.
|
“Good
Reason”
for Employee’s resignation from employment with Employer
means:
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1.7.1.
|
a
forced relocation of the place for Employee’s performance of duties
reasonably requiring a move in Employee’s
residence;
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1.7.2.
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a
material breach by Employer or its Affiliates of this Agreement or
any
other agreement under which Employee provides services to Employer
or its
Affiliates;
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1.7.3.
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conduct
by Employer that could reasonably be expected to expose Employee
to
material personal liability or other material adverse legal consequences;
or
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1.7.4.
|
a
material diminution of Employee’s base compensation or of the nature or
scope of Employee’s duties or responsibilities in effect immediately after
the Effective Date with respect to the business conducted by Employer,
whether Employer remains a separate corporation, is combined with
Best Buy
or one of its Affiliates, or becomes an operating division of Best
Buy or
one of its Affiliates.
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Notwithstanding
the foregoing, however, any condition or conditions otherwise set forth in
this
Section
1.7
shall
not constitute Good Reason for termination unless both (a) Employee
provides written notice to Employer of the condition claimed to constitute
grounds for Good Reason within ninety (90) days of the initial existence of
such
condition, and (b) the condition is not remedied within thirty (30) days of
such notice. In addition, in all events the termination of Employee’s employment
shall not constitute a termination for Good Reason unless such termination
occurs less than one (1) year following the initial existence of the condition
claimed to constitute grounds for Good Reason.
2
1.8.
|
“Invention”
means any invention, discovery, improvement, concept or idea, whether
or
not patentable or copyrightable, including but not limited to computer
software and hardware, technology, machines, devices, processes,
methods,
techniques and formulae, generated, conceived or reduced to practice
by
Employee alone or in conjunction with others, relating to the business
of
Employer or its Affiliates, during or after working hours, while
employed
by Employer.
|
1.9.
|
“Willful”
means all dishonest, willful, deliberate, or intentional acts or
omissions; provided,
however,
that no act, or failure to act, on Employee’s part shall be considered
Willful unless done, or omitted to be done, by Employee in bad faith
and
without reasonable belief that Employee’s action or omission was in, or
not opposed to, the best interest of Employer or its
Affiliates.
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2.
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Employment.
Subject to the closing of the Merger and effective as of the Effective
Date, Employer hereby employs Employee as [____________], and Employee
accepts such employment and agrees to perform services for Employer
and
its Affiliates for the period and upon the other terms and conditions
set
forth in this Agreement.
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3.
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Term.
The term of this Agreement shall commence on the Effective Date and,
unless terminated at an earlier date in accordance with Section
9
hereof, shall continue thereafter for a period ending March 3, 2012.
Thereafter, the term of this Agreement may be extended only upon
written
agreement of Employee and Employer. Unless otherwise provided herein,
the
terms of Sections
6,
7.2
(only with respect to Inventions conceived or made by Employee during
the
period of his employment with Employer or its Affiliates), 8,
9,
and 10
hereof shall survive the expiration or termination of this Agreement
for
any reason.
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4.
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Duties.
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4.1.
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Employee
shall serve Employer and its Affiliates faithfully and to the best
of his
ability, and devote his full business time, attention and efforts
to the
business and affairs of Employer and its Affiliates during normal
business
hours (and outside normal business hours as reasonably required)
during
the term of this Agreement, subject to holidays, leave and other
paid time
off taken in accordance with Employer’s plans and programs. The duties of
Employee shall primarily consist of, but shall not be limited to,
the
management, operation and oversight of Employer’s business, including
without limitation all responsibilities historically associated with
Employee’s role as [_________] of
Employer.
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4.2.
|
In
addition, Employee shall have such duties consistent with Employee’s
position as are reasonably assigned Employee pursuant to Employer’s annual
goal setting and appraisal processes, as such processes may be amended
from time to time.
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3
4.3.
|
Employee
shall comply with all written policies of Employer, or of Best Buy
generally applicable to executives of Best Buy, that are not inconsistent
with this Agreement.
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4.4.
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During
the term of this Agreement, and except for services with respect
to
charitable or non-profit organizations that do not unreasonably interfere
with Employee’s duties and/or responsibilities to Employer and its
Affiliates, Employee shall not perform services for, or take an active
management role in, or become a member of the board of directors
or
similar body for, any other corporation, firm, entity or person without
the prior written approval of Employer (which approval of Employer
shall
not be unreasonably withheld if Employee requests to become a member
of
the board of directors or similar body of a company that does not
compete
with Employer, Best Buy, or any of their respective
Affiliates).
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5.
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Compensation.
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5.1.
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Base
Salary.
As compensation for the services to be rendered by Employee under
this
Agreement, Employer shall pay to Employee an annual base salary of
[$________], which salary shall be paid in accordance with Employer’s
normal payroll procedures and policies, but not less frequently than
in
biweekly installments. Employee’s salary shall be subject to review by
Employer in accordance with Employer’s salary review procedures as in
effect from time to time and not less frequently than on an annual
basis;
provided that Employer may not decrease Employee’s base
salary.
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5.2.
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Short-Term
Incentive Compensation.
Employee shall be eligible for short-term incentive compensation
with an
incentive target of 30% of base salary and a maximum incentive payout
of
two times the target (60% of base salary). With respect to the short-term
incentive compensation opportunity for the remainder of fiscal year
2009
(the fiscal year ending February 28, 2009), (a) the incentive formula
will
be based on Best Buy enterprise financial performance goals currently
in
effect for peer executives employed by Best Buy or any of its
subsidiaries, (b) the short-term incentive compensation amount will
be pro
rated from the Acceptance Date with respect to the Offer under the
Merger
Agreement (as such terms are defined in the Merger Agreement) to
February
28, 2009, and (c) such compensation will be payable only if the Acceptance
Date is on or before December 31, 2008. With respect to the short-term
incentive compensation opportunity for fiscal year 2010 (March 1,
2009 to February 27, 2010) and any subsequent fiscal years covered
by
this Agreement,
the incentive formula will be based on Employer financial performance
goals (i.e., revenue growth and operating income or free cash flow
actual
results against fiscal year targets) and on Employee performance
goals
(against individual objectives) as reasonably established by Xxxxx
Xxxxxxx, EVP of Best Buy, in consultation with Employer’s Chief Executive
Officer and Advisory Board. Future short term incentive goals and
targets
shall be reasonably established such that target levels of performance
are
reasonably attainable. To be entitled to any short-term incentive
compensation amounts, Employee must be employed by Employer on the
last
day of the fiscal year to which such compensation relates. Any short-term
incentive compensation amounts actually payable to Employee for a
particular fiscal year shall be paid to Employee within 2 ½ months
following the end of the Employer’s fiscal year to which such compensation
relates, whether or not Employee is employed on the payment
date.
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5.3.
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Employer
Restricted Stock Awards.
In connection with the Merger and pursuant to the terms of the Merger
Agreement, each share of Employer’s common stock granted to Employee under
the Employer’s 2001 Stock Plan (the “2001
Plan”)
as a restricted stock award that is outstanding at the Effective
Time
shall be assumed by Best Buy or an Affiliate and be converted into
the
right to receive cash consideration having a value equal to the Merger
Consideration as defined in the Merger Agreement (such cash consideration,
the “Assumed
Equity Value”).
The Assumed Equity Value will be paid in installments as set forth
on, and
on (or not later than thirty (30) days following) the corresponding
dates
set forth on, Schedule
5.3
hereto; provided that, except as provided in Section 9.5.2.4, Employee
remains continuously employed by Best Buy or any of its affiliates
(including, without limitation, the Employer) through the corresponding
payment date set forth on Scheduled 5.3 (for purposes of clarity,
Employee
need only be employed on such date set forth on Schedule 5.3 even
if the
actual payment is made later in the 30-day period provided for
above).
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4
5.4.
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Long-Term
Incentive Award.
As soon as practicable after the Effective Date, Best Buy will grant
to
Employee a Long-Term Incentive Award as described in Schedule
5.4
hereto, to be evidenced by an Award
Agreement substantially in
the form attached as Exhibit
B
hereto.
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5.5.
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Stock
Option Award.
Contingent upon approval by the Compensation Committee of the Best
Buy
Board of Directors, Best Buy will grant to Employee an option or
options
to purchase an aggregate [_____] shares of Best Buy common stock,
to be
evidenced by a Stock Option Award Agreement
substantially in
the form attached as Exhibit
C
hereto. These stock options will be granted under Best Buy’s 2004 Omnibus
Stock and Incentive Plan and will be subject to all of the terms
and
conditions of such Plan and the applicable Stock Option Award Agreement.
The first vesting period of such options will be no later than the
first
anniversary of the date of grant by the Compensation Committee with
all
subsequent vesting dates measured from such date of grant, all as
approved
by the Compensation Committee of the Best Buy Board of Directors.
If any
approval of the Compensation Committee required under this Section
5.4
is
not obtained by
February 28, 2009, Employee
may terminate this Agreement, with immediate effect, for “Good
Reason.”
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5.6.
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Participation
in Benefit Plans.
Employee will be entitled to participate in such benefit plans and
programs as are established by Best Buy or Employer, from time to
time, to
the extent that his position, title, tenure, salary, age, health
and other
qualifications make him eligible to participate; provided
that for a period of twelve (12) months from the Effective Date,
any such
plans and programs shall, in the aggregate, provide benefits to Employee
that are not less favorable in the aggregate to Employee than the
benefits
in effect with respect to Employee immediately prior to the Merger,
it
being understood that the foregoing shall not require Employer to
maintain
any particular employee benefit plan, and that Employer shall not
be
required to maintain the same stock option or employee stock purchase
plans as Employer maintained prior to the Merger. Employee’s participation
in any benefit plans or programs shall be subject to the provisions,
contributions, rules and laws applicable
thereto.
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5.7.
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Expenses.
Employer shall pay or reimburse Employee for all travel and other
out-of-pocket expenses reasonably incurred by him in the performance
of
his duties under this Agreement, subject to Best Buy’s usual and customary
documentation policies for reimbursement of business
expenses.
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5
5.8.
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Vacation.
During the term of this Agreement, Employee shall be entitled to
annual
vacation on the same basis as in effect with respect to Employee
immediately prior to the Merger.
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6.
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Confidential
Information.
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6.1.
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Employee
shall not divulge, furnish or make accessible to anyone or use in
any way
(other than for the business of Employer or any of its Affiliates)
any
confidential or secret knowledge or information of Employer or any
of its
Affiliates which Employee has acquired or become acquainted with
or shall
acquire or become acquainted with prior to the termination of the
period
of his employment by Employer (including employment by Employer or
any of
its Affiliates), whether developed by himself or by others, including,
without limitation, any trade secrets, confidential or secret designs,
processes, formulae, plans, devices or material (whether or not patented
or patentable) of Employer or any of its Affiliates, financial results
or
condition, business plans or projections of Employer or any of its
Affiliates, any confidential customer lists of Employer or any of
its
Affiliates, any confidential or secret development or research work
of
Employer or any of its Affiliates, any lists of potential investments
or
acquisitions contemplated by Employer or any of its Affiliates, any
plans,
proposals or strategies of Employer or its Affiliates to expand,
merge or
engage in a business combination or relationship or any other confidential
or secret aspects of the business of Employer or any of its Affiliates.
Employee acknowledges that the above-described knowledge or information
constitutes a unique and valuable asset of Employer and its Affiliates,
as
the case may be, acquired at great time and expense by Employer,
its
predecessors and its Affiliates, as the case may be, and that any
disclosure or other use of such knowledge or information other than
for
the sole benefit of Employer or any of its Affiliates would be wrongful
and could cause irreparable harm to Employer and its Affiliates,
as the
case may be.
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6.2.
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The
foregoing obligations of confidentiality, however, shall not apply
to any
knowledge or information which (i) is now publicly known or which,
through
no act or omission of Employee, becomes publicly known, (ii) Employee
rightfully possessed without an obligation of confidentiality before
the
date of this Agreement, or (iii) Employee divulges, furnishes or
discloses
in a truthful response to a lawful and valid subpoena or other legal
process.
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6.3.
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The
confidentiality obligation of Employee shall remain in effect as
long as
the knowledge or information retains its confidential or secret
nature.
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7.
|
Ventures;
Assignment of Inventions.
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7.1.
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Ventures.
If, during the term of this Agreement, Employee is engaged in or
associated with the planning or implementing of any project, event,
publication, program or venture involving Employer or any of its
Affiliates, or their respective trademarks or intellectual property,
and a
third party or parties, all rights in the project, event, publication,
program or venture, to the extent that such rights may be claimed
by
Employee or Employer or any of its Affiliates, shall belong to Employer
or
its Affiliates, as the case may be. Except as approved by Employer’s Board
of Directors, Employee shall not be entitled to any interest in such
project, program or venture or to any commission, finder’s fee or other
compensation in connection therewith other than the compensation
to be
paid to Employee as provided in this
Agreement.
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6
7.2.
|
Assignment
of Inventions.
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7.2.1.
|
Employee
agrees that all Inventions made during his employment by Employer
are the
exclusive property of Employer.
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7.2.2.
|
Employee
further agrees that he will:
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7.2.2.1.
|
promptly
and fully disclose and describe all Inventions in writing to an officer
of, or other person designated by, Employer and such disclosure shall
include, if requested, a detailed report of the procedures employed
and
the results achieved by Employee;
and
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7.2.2.2.
|
give
Employer and its Affiliates all assistance they require to perfect,
protect and use its worldwide rights to Inventions, including, but
not
limited to, signing all documents, doing all things and supplying
all
information that Employer may deem necessary or desirable to: (i)
transfer
or record the transfer of Employee’s entire right, title and interest in
Inventions to Employer; and (ii) enable Employer and its Affiliates
to
obtain and maintain patent, copyright or trademark protection for
Inventions anywhere in the world.
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7.2.3.
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Notwithstanding
anything to the contrary in this Section
7.2,
Employee and Employer agree that the provisions of this Section
7.2
requiring assignment of Inventions to Employer do not apply to any
Invention that was developed by Employee entirely on Employee’s own time
and without use of equipment, supplies, facilities or trade secret
information of Employer or any of its Affiliates, unless (a) the
Invention
relates (i) directly to the business of Employer or any of its Affiliates,
or (ii) to Employer’s or any of its Affiliates actual or demonstrably
anticipated research or development or (b) the Invention results
from any
work performed by Employee for Employer or any of its
Affiliates.
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7.3.
|
Copyrights.
Employee agrees that Employer will own all copyrightable works created
by
Employee relating to the business of Employer and its Affiliates
developed
during his employment as “works
made for hire”
to the full extent provided for under U.S. or foreign law. To the
extent
any work of Employee does not qualify as a “work
made for hire”,
Employee agrees to assign all U.S. and foreign trademark, copyright,
mask
work registration, and other registrations and rights pertaining
to that
work to Employer.
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8.
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Non-Solicitation.
Throughout the term of Employee’s employment by Employer or its Affiliates
and for a period of twelve (12) months following the termination
of
Employee’s employment, Employee will not, directly or indirectly, employ,
solicit for employment, or advise or recommend to any other person,
firm
or corporation that they employ or solicit for employment any employee
of
Employer or any of its Affiliates. The parties hereto agree that
Employer
may suffer irreparable harm from a breach by Employee of the covenants
or
agreements contained in this Section
8,
and that monetary damages may be inadequate to compensate Employer
for any
such breach. Accordingly, Employee agrees that in the event of any
breach
by Employee of this Section
8,
Employer or its Affiliates, successors or assigns shall be entitled
to
temporary and permanent injunctive relief to enforce or prevent any
violations of this Section
8
and that such relief may be granted without the necessity of proving
actual damages. Such injunctive or equitable relief shall be in addition
to and not in lieu of any right to recover money damages for any
such
breach.
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7
9.
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Termination.
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9.1.
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Death,
Disability.
This Agreement shall terminate prior to the expiration of the term
set
forth in Section
3
hereof or of any extension thereof:
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9.1.1.
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Immediately
upon the date of Employee’s death;
or
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9.1.2.
|
Immediately
upon the date that Employee is unable to perform his duties hereunder
due
to a Disability.
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9.2.
|
Termination
Without Cause or Resignation for Good Reason.
This Agreement shall terminate prior to the expiration of the term
set
forth in Section
3
hereof or of any extension thereof if Employee’s employment is terminated
by Employer without Cause or Employee resigns for Good
Reason.
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9.3.
|
Resignation
Without Good Reason.
This Agreement shall terminate prior to the expiration of the term
set
forth in Section
3
hereof or of any extension thereof if Employee resigns for any reason
other than Good Reason. Any resignation pursuant to this Section
9.3
shall be effective thirty (30) days after Employee provides written
notice
to Employer of Employee’s intention to resign. Any resignation in
accordance with this Section
9.3
shall not be deemed a breach by Employee of this
Agreement.
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9.4.
|
Termination
For Cause.
This Agreement shall terminate prior to the expiration of the term
set
forth in Section
3
hereof or of any extension thereof if Employee is terminated by Employer
for Cause. Any termination pursuant to this Section
9.4
shall be effective immediately upon written notice from Employer
to
Employee.
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9.5.
|
Effect
of Termination.
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9.5.1.
|
In
the event Employee’s employment is terminated for any reason prior to or
upon expiration of the term of this Agreement provided in Section
3
hereof or any extension thereof, Employer shall be obligated to pay
Employee his salary, accrued and unpaid vacation, and benefits through
the
date of termination (including any notice periods), and unreimbursed
expenses incurred prior to the date of termination in accordance
with
Section
5.7
hereof.
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9.5.2.
|
In
the event Employee’s employment is terminated by Employer without Cause or
Employee resigns for Good Reason pursuant to Section
9.2,
then in addition to any amounts that may be due pursuant to Section
9.5.1
hereof:
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9.5.2.1.
|
Employer
will pay Employee a lump sum cash amount equal to Employee’s highest
annual base salary rate in effect at any time in the preceding year,
such
amount to be paid within thirty (30) days following such termination
of
employment; provided,
however,
that notwithstanding anything to the contrary in this Section
9.5.2.1,
if Employee’s termination of employment is not a separation from service
within the meaning of Section 409A of the Code and the regulations
and
other published guidance thereunder (including §1.409A-1(h)), then, if
required in order to comply with the provisions of Section 409A of
the
Code and avoid the imputation of any tax, penalty or interest thereunder,
payment of the lump sum cash amount shall be delayed until such a
separation from service occurs and shall be paid within thirty (30)
days
following the date of such separation from
service;
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8
9.5.2.2.
|
Until
a separation from service occurs, Employee shall be entitled to
participate in benefit plans and programs as provided in Section
5.6
hereof. If Employee elects, following a separation from service,
to
continue his health insurance coverage under COBRA, Employer will
reimburse Employee for the cost of the premiums during the first
twelve
(12) months of such coverage; and any period of Employee’s COBRA
continuation coverage for which the cost is reimbursed by Employer
will
count toward the eighteen (18) month duration of available continuation
coverage, as provided under Federal law, and any similar coverage
under
applicable State law;
|
9.5.2.3.
|
Employer
will be obligated to pay Employee within thirty (30) days following
such
termination of employment (or if later, the date of Employee’s separation
from service) a lump-sum amount equal to the greater of (i) the incentive
target under the short-term incentive plan described in Section
5.2
hereof for the year in which such termination occurs, pro rated to
the
date of termination, or (ii) Employer’s reasonable estimate at the time of
termination of employment of the actual amount payable under the
short-term incentive plan described in Section
5.2
hereof for the year in which such termination occurs, pro rated to
the
date of termination;
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9.5.2.4.
|
Any
unvested portion of the Assumed Equity Value shall become vested
upon such
termination of employment and shall be paid within thirty (30) days
following such termination;
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9.5.2.5.
|
the
terms of the Long-Term Incentive Award described in Section
5.4
hereof (including the Award Agreement) shall govern whether any amounts
shall be payable thereunder upon such termination;
and
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9.5.2.6.
|
the
terms of the stock option award described in Section
5.5
hereof (including the terms of Best Buy’s 2004 Omnibus Stock and Incentive
Plan and Employee’s Stock Option Award Agreement thereunder) shall govern
whether any portion of such award shall be exercisable upon such
termination.
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9.5.2.7.
|
As
a condition to the severance benefits described in this Section
9.5.2,
Employee will enter into an agreement releasing all claims against
Employer and its Affiliates, in the form attached as Exhibit
A
hereto, and all applicable rescission periods shall have expired
without
exercise. Employer’s obligations under this Section
9.5.2
immediately shall cease if Employee materially breaches any of the
covenants in Sections
6,
7,
8
and 9.7
hereof.
|
9.5.3.
|
In
the event Employee’s employment is terminated prior to or upon expiration
of the term of this Agreement provided in Section
3
hereof or any extension thereof, other than a termination described
in
Section
9.5.2
hereof, then in addition to any amounts that may be due pursuant
to
Section
9.5.1
hereof:
|
9
9.5.3.1.
|
the
terms of the short-term incentive plan described in Section
5.2
hereof shall govern whether any incentive shall be payable in the
year of
termination;
|
9.5.3.2.
|
the
terms of the Employer restricted stock awards described in Section
5.3
hereof (including the terms of the 2001 Plan and Employee’s restricted
stock award agreement(s) thereunder) shall govern whether any amounts
shall be payable thereunder upon such termination;
|
9.5.3.3.
|
the
terms of the Long-Term Incentive Award described in Section
5.4
hereof (including the Award Agreement) shall govern whether any amounts
shall be payable thereunder upon such termination;
|
9.5.3.4.
|
the
terms of the stock option award described in Section
5.5
hereof (including the terms of Best Buy’s 2004 Omnibus Stock and Incentive
Plan and Employee’s Stock Option Award Agreement thereunder) shall govern
whether any portion of such award shall be exercisable upon such
termination; and
|
9.5.3.5.
|
thereafter,
no salary, incentive, or any other benefits or amounts shall be payable
or
extended by Employer to Employee, except as required by Federal or
State
law or to the extent the Employee’s rights to such benefits or amounts
were earned on the date of
termination.
|
9.5.4.
|
All
amounts payable to Employee pursuant to Section
9.5.1,
Section
9.5.2
and Section
9.5.3
shall be paid without regard to whether Employee has taken or takes
actions to mitigate damages.
|
9.6.
|
Limitation
on Payments.
In the event that the severance and other benefits provided for in
this
Agreement or otherwise payable to Employee (i) constitute “parachute
payments”
within the meaning of Section 280G of the Code and (ii) would be
subject
to the excise tax imposed by Section 4999 of the Code (the “Excise
Tax”),
then Employee’s benefits under this Agreement or otherwise payable to
Employee shall be either delivered in full (without Employer paying
any
portion of the Excise Tax due upon such payment), or delivered as
to such
lesser extent which would result in no portion of such benefits being
subject to the Excise Tax, whichever of the foregoing amounts, taking
into
account the applicable federal, state and local income taxes and
the
Excise Tax, results in the receipt by Employee on an after-tax basis,
of
the greatest amount of benefits, notwithstanding that all or some
portion
of such benefits may be taxable under Section 4999 of the Code. Unless
Employer and Employee otherwise agree in writing, any determination
required under this Section
9.6
shall be made in writing by Employer’s or an Affiliate’s independent
public accountants (the “Accountants”),
whose determination shall be conclusive and binding upon Employee
and
Employer for all purposes. For purposes of making the calculations
required by this Section
9.6,
the Accountants may make reasonable assumptions and approximations
concerning applicable taxes and may rely on reasonable, good faith
interpretations concerning the application of Section 280G and 4999
of the
Code. Employer and Employee shall furnish to the Accountants such
information and documents as the Accountants may reasonably request
in
order to make a determination under this Section
9.6.
Employer shall bear all costs the Accountants may reasonably incur
in
connection with any calculations contemplated by this Section
9.6.
|
10
9.7.
|
Surrender
of Records and Property.
Upon termination of his employment for any reason, Employee shall
deliver
promptly to Employer all records, manuals, books, blank forms, documents,
letters, manuscripts, letter head, business cards, memoranda, notes,
notebooks, reports, data, tables, calculations, computers/PDAs,
security/ID cards, keys, computer files, cell phones, pagers, parking
permits, company credit cards, financial statements or records, budgets
or
business plans or copies thereof, that are the property of Employer
or any
of its Affiliates and all other property, trade secrets and confidential
information of Employer or any of its Affiliates, including, but
not
limited to, all documents which in whole or in part contain any trade
secrets or confidential information of Employer or any of its Affiliates,
which in any of these cases are in his possession or under his control,
provided,
however,
that Employee may retain his personal rolodex, address books, information
relating to Employee’s compensation or benefits or relating to
reimbursement of expenses and any agreement relating to the terms
of
Employee’s employment with
Employer.
|
10.
|
Miscellaneous.
|
10.1.
|
Governing
Law.
Recognizing that Employer is a wholly-owned subsidiary of Best Buy,
this
Agreement shall be governed by and interpreted under the laws of
the State
of Minnesota without regard to its or any other jurisdiction’s conflict of
laws provisions, except to the extent any of the provisions of California
Labor Code are applicable. The parties hereby expressly consent and
submit
to the exclusive jurisdiction of either the federal or state district
courts located in Minneapolis,
Minnesota.
|
10.2.
|
Entire
Agreement.
Once the Effective Date occurs, this Agreement, in conjunction with
any
exhibits, schedules, addenda, amendments, or other attachments hereto,
contains the entire agreement between the parties and supersedes
all prior
agreements, negotiations, oral understandings, representations,
warranties, and courses of conduct and dealing with respect to the
subject
matter hereof and shall control any conflicting similar provision
in any
other agreement, plan or program to which Employee may previously
have
been a party or participant in connection with his employment;
provided
that all
of Employee’s existing rights to indemnification with respect to any
action or omission to act occurring or allegedly occurring prior
to the
Effective Date shall remain unaffected and undiminished as a result
of the
execution of this Agreement. Subject to the occurrence of the Effective
Date, this Agreement supersedes and replaces in its entirety the
Existing
Agreement, which shall be of no further force and effect, and Employer
shall have no liability or obligations thereunder. In the event the
Merger
Agreement is terminated and the Effective Date therefore does not
occur,
this Agreement will be void and will create no rights and impose
no
liabilities or obligations on Employer or
Employee.
|
10.3.
|
Withholding
Taxes.
Employer may withhold from any benefits payable under this Agreement
all
federal, state, city or other taxes as shall be required pursuant
to any
law or governmental regulation or
ruling.
|
10.4.
|
Code
Section 409A.
Notwithstanding any provision of this Agreement to the contrary,
if the
Employee is a “specified employee” as defined in Section 409A of the Code,
the Employee shall not be entitled to any payments upon a termination
of
Employee’s employment until the earlier of (i) the date which is six (6)
months after Employee’s separation from service (as such term is defined
in Section 409A of the Code and the regulations and other published
guidance thereunder) for any reason other than death, or (ii) the
date of
the Employee’s death. Any amounts otherwise payable to the Employee
following a termination of employment that are not so paid by reason
of
this Section
10.4
shall be paid as soon as practicable, and in any event within thirty
(30)
days, after the date that is six (6) months after Employee’s separation
from service (or, if earlier, the date of Employee’s death). The
provisions of this
Section 10.4
shall only apply if, and to the extent, required to comply with Section
409A of the Code. To the extent that any reimbursements pursuant
to
Section
5.6
or
Section
9.5.2.2
are taxable to Employee, any reimbursement payment due to Employee
pursuant to such provisions shall be paid to Employee on or before
the
last day of the Employee’s taxable year following the taxable year in
which the related expense was incurred. The reimbursements pursuant
to
Section
5.6
or
Section
9.5.2.2
are not subject to liquidation or exchange for another benefit and
the
amount of such reimbursements that Employee receives in one taxable
year
shall not affect the amount of such reimbursements that Employee
receives
in any other taxable year.
|
11
10.5.
|
Amendments.
This Agreement, or any provisions hereof, may not be amended,
supplemented, waived, or modified in any way, except by a written
instrument signed by individuals authorized by the parties
hereto.
|
10.6.
|
Assignment.
This Agreement may not be assigned, delegated, or subcontracted in
whole
or in part by either party without first obtaining the other party’s
express written consent; provided,
however,
that Employer may assign, delegate, or subcontract this Agreement
in whole
or in part to a present or future Affiliate without obtaining Employee’s
express written consent, provided that such present or future Affiliate
expressly assumes the obligations of Employer under this Agreement,
and
provided further,
that in the event of a sale or other transfer of all or substantially
all
of the assets or business of Employer with or to any other individual(s)
or entity that is not an Affiliate, this Agreement shall be binding
upon
and inure to the benefit of such successor and such successor shall
discharge and perform all the promises, covenants, duties, and obligations
of Employer hereunder. Any assignment, delegation, or subcontract
not
complying with the terms of this Section
10.6
shall be null and void. In the event of a proper assignment, delegation,
or subcontract, this Agreement shall inure to the benefit of and
be
binding upon each of the parties and their respective successors,
assigns,
heirs, executors, administrators, trustees, legal representatives,
delegatees, and subcontractees.
|
10.7.
|
Waiver.
Failure by either party to this Agreement to enforce or insist upon
compliance with any provision of this Agreement shall not be construed
as
a waiver of its right to enforce or insist upon compliance with such
provision, or other provisions in the future. A waiver by either
party of
a breach of any of the provisions of this Agreement shall not be
construed
as a waiver of any subsequent breach by either party. Neither party
shall
be deemed to have waived any of its rights, powers, or remedies pursuant
to this Agreement unless such waiver is contained in a written instrument
signed by Employee or an authorized officer of Employer, as
applicable.
|
10.8.
|
Injunctive
Relief.
Employee agrees that it would be difficult to compensate Employer
fully
for damages for any violation of the provisions of
Sections 6,
7,
and 8
of
this Agreement. Accordingly, Employee specifically agrees that Employer
may be entitled to temporary and permanent injunctive relief to enforce
such provisions of this Agreement. This provision with respect to
injunctive relief shall not, however, diminish the right of Employer
to
claim and recover damages in addition to injunctive
relief.
|
12
10.9.
|
Severability.
To the extent any provision of this Agreement shall be invalid or
unenforceable, it shall be considered deleted herefrom and the remainder
of such provision and of this Agreement shall be unaffected and shall
continue in full force and effect. In furtherance and not in limitation
of
the foregoing, should the duration or geographical extent of, or
business
activities covered by, any provision of this Agreement be in excess
of
that which is valid and enforceable under applicable law, then such
provision shall be construed to cover only that duration, extent
or
activities which may validly and enforceably be covered. Employee
acknowledges the uncertainty of the law in this respect and expressly
stipulates that this Agreement be given the construction which renders
its
provisions valid and enforceable to the maximum extent (not exceeding
its
express terms) possible under applicable
law.
|
10.10.
|
Notices.
All notices, requests, demands, approvals, consents, and other
communications which are required or may be given hereunder shall
be (i)
in writing; (ii) addressed to the parties as set forth below, unless
a
party notifies the others of a change of address (in which case the
latest
noticed address shall be used); and (iii) deemed to have been duly
given:
(a) upon delivery thereof, if hand-delivered, (b) three (3) business
days
after being sent by first-class mail, postage prepaid, (c) one (1)
business day after delivery to a recognized overnight courier for
next-business-day delivery, or (d) upon receipt thereof if transmitted
by
facsimile or other electronic means, provided receipt thereof is
verified
by the sender.
|
Notices
To Employee:
|
[______________]
|
[______________]
|
|
[______________]
|
Notices
To Employer or Best Buy:
|
Best
Buy Co., Inc.
|
Attn:
General Counsel
|
|
0000
Xxxx Xxxxxx Xxxxx
|
|
Xxxxxxxxx,
XX 00000
|
|
Fax:
000-000-0000
|
10.11.
|
Representations
and Warranties.
Each party represents and warrants to the other that (i) such party
has
the full right, power, and authority to enter into this Agreement
and to
perform the acts required of it hereunder; (ii) the execution of
this
Agreement by such party, and the performance by such party of its
obligations and duties hereunder, do not and will not violate any
agreement to which such party is a party or by which it is otherwise
bound; (iii) such party will comply with all laws, rules, and regulations
in performing its obligations pursuant to this Agreement; and (iv)
when
executed and delivered by such party, this Agreement will constitute
the
legal, valid and binding obligation of such party, enforceable against
such party in accordance with its
terms.
|
10.12.
|
Intellectual
Property.
Employee acknowledges that he is not acquiring any right, title,
or
interest in Employer’s trademarks, trade names, service marks, copyrights,
patents, ideas, concepts, designs, specifications, models, processes,
software systems, technologies, and other intellectual property owned
or
developed by Employer, its Affiliates, and Employer’s and its Affiliates
employees, contractors, or
consultants.
|
13
10.13.
|
Public
Announcements.
Except
for Employee’s role (if any) in helping Employer prepare and make any
filings with the SEC reasonably required with respect to this Agreement,
Employee
shall not make any public announcement (including, but not limited
to any
statement, comment, press release, or web site posting) regarding
this
Agreement or the parties’ relationship unless Employee obtains Employer’s
prior express written consent.
|
10.14.
|
Indemnification.
Employer and Best Buy each hereby agree to indemnify Employee and
hold
Employee harmless to the maximum extent provided under the by-laws
or
other organizational documents of Employer immediately prior to the
Closing, or Best Buy, as applicable, or, if applicable state law
provides
the opportunity to afford greater protections to Employee, to the
maximum
extent permitted under applicable state law, against and in respect
of any
and all actions, suits, proceedings, claims, demands, judgments,
costs,
expenses (including reasonable attorneys’ fees), losses and damages
resulting from Employee’s good faith performance of Employee’s duties and
obligations with Employer, Best Buy or their respective Affiliates.
This
obligation shall survive the termination of Employee’s employment with
Employer, Best Buy or their respective
Affiliates.
|
10.15.
|
Limitation
on Causes of Action.
Neither party hereto may raise a claim of any nature relative to
this
Agreement (other than a claim brought in response to or pendent to
a claim
brought by the other party hereto) after the earlier of (i) the end
of any
period provided by the applicable statue of limitations or (ii) the
date
two (2) years after the termination or expiration of this Agreement
or any
extension thereof.
|
10.16.
|
Remedies.
No remedy made available to Employer by any of the provisions of
this
Agreement is intended to be exclusive of any other remedy, and each
and
every remedy shall be cumulative and in addition to every other remedy
available to Employer at law or in
equity.
|
10.17.
|
Interpretation.
This Agreement and each and every term and condition herein has been
cooperatively and mutually drafted and shall not be construed or
interpreted more strictly against either party. In the event of a
conflict
between any term in the body of this Agreement and any exhibit, schedule,
or attachment, the terms of the body of this Agreement shall prevail.
The
words “herein,”
“hereof,”
hereunder,”
“hereto,”
and other words of similar import refer to this Agreement as a whole,
including the schedules, exhibits, and attachments hereto, as the
same may
from time to time be amended or supplemented, and not to any particular
section, subsection, or clause contained in this Agreement. Whenever
necessary or proper herein, the singular imports the plural or vice
versa,
and masculine, feminine, and neuter expressions are interchangeable.
Unless otherwise specifically indicated, the word “including”
shall always be interpreted as though immediately followed by the
phrase
“but
not limited to.”
Unless otherwise explicitly stated: (i) a reference in an exhibit,
schedule, or attachment to a Section refers to the appropriate numbered
Section within such exhibit, schedule, or attachment, (ii) all other
references to a Section refer to the appropriate numbered Section
in the
body of this Agreement, and (iii) all references to a Section include
the
subsections of the referenced
Section.
|
10.18.
|
No
Third Party Beneficiaries.
This Agreement and the rights and obligations created under it shall
be
binding upon and inure solely to the benefit of the parties hereto
and
their respective successors and permitted assigns, and except as
otherwise
expressly set forth in this Agreement, the parties do not intend
to confer
upon any other person any right, remedy, or claim under or by virtue
of
this Agreement.
|
14
10.19.
|
Headings.
The headings contained in this Agreement are for reference purposes
only
and shall not be considered in interpreting the meaning of or application
of law to this Agreement.
|
10.20.
|
Counterparts.
This Agreement may be executed in any number of counterparts, each
of
which, when so executed, shall be deemed an original, but all of
said
counterparts taken together shall constitute one and the same
instrument.
|
10.21.
|
Facsimile
Signatures.
This Agreement may be executed and delivered by facsimile. Any facsimile
signatures shall have the same legal effect as manual
signatures.
|
[The
remainder of this page has been intentionally left blank.]
15
IN
WITNESS WHEREOF,
the
parties hereto have executed this Agreement as of the date first set forth
above.
NAPSTER,
INC.
|
|
By:
|
|
Name:
|
|
Title:
|
Employee
represents that he has read carefully and fully understands the terms of this
Agreement, and that he has consulted with an attorney prior to signing this
Agreement. Employee acknowledges that he is executing this Agreement voluntarily
and knowingly and that he has not relied on any representations, promises,
or
agreements of any kind made to Employee in connection with Employee’s decision
to accept the terms of this Agreement, other than those set forth in this
Agreement. Employee acknowledges that he has been informed that attorneys
representing Employer do not represent Employee personally.
Date:
September 14, 2008
|
16
Schedule
5.3
Employer
Restricted Stock Award Payment Schedule
Participant
|
|
|
Payment at
Effective
Date
|
|
|
Payment at
1/1/2009
|
|
|
Payment at
1st Anniv.
of Effective
Date
|
|
|
Payment at
1/1/2010
|
|
|
Payment at
1/1/2011
|
|
|
Payment at
1/1/2012
|
|
[___________]
|
$
|
[_____]*
|
$
|
[______
|
]
|
$
|
[______
|
]
|
$
|
[______
|
]
|
$
|
[_____
|
]
|
$
|
[______
|
]
|
* |
The amount payable at
the Effective Date represents the aggregate amount payable with respect
to
that portion of Employee’s restricted stock award(s) that vests as a
result of and concurrent with the occurrence of a Change of Control
(as
defined in the 2001 Plan). To the extent such vesting occurs prior
to the
Effective Date, such payment will not be made (to avoid duplication
of
payment), because (i) a portion of such shares will have been withheld
to
satisfy applicable tax withholding obligations and (ii) Employee
will
otherwise have received or become entitled to receive payment of
the Offer
Consideration or Merger Consideration with respect to any of such
shares
that are tendered by Employee pursuant to the Offer or cancelled
in the
Merger, as the case may be.
|
17
Schedule
5.4
Long-Term
Incentive Award
The
following is a summary of the material terms of the Long-Term Incentive Award.
The Long-Term Incentive Award will be subject to and governed by the terms
and
conditions of the Award Agreement (substantially
in the
form
attached as Exhibit
B).
This
Schedule
5.4
is
qualified in its entirety by such Award Agreement.
Long-Term
Incentive Award
You
will
be eligible to receive a one-time Long-Term Incentive Award (“Incentive Award”)
pursuant the Award Agreement, based on the Award Target Value described below.
Any Incentive Award that is earned will be payable in the form of
cash.
Plan Participant
|
Award Target Value
|
Maximum
Incentive Award*
|
|||||
$
|
[_______
|
]
|
$
|
[________
|
]
|
*
You
may
earn from 0%-200% of the Award Target Value depending on satisfaction of
performance goals.
You
may
earn 0% - 200% of the Award Target Value (described above) based on
achievement of specific performance goals, based on Napster results, during
the
period March
1, 2009 through March 3, 2012.
The
performance goals will be mutually determined by X. Xxxxx and X. Xxxxxxx, and
approved by the Best Buy Controllership Team. At the end of the performance
period, whether and the extent to which the performance goals have been achieved
will be determined based on audited financial statements prepared by Employer,
in accordance with GAAP, and approved by the Controllership Team. The
performance goals and results may be adjusted, in limited circumstances, at
the
discretion of the Controllership Team. The following is a sample performance
table that would be applied with respect to the agreed upon performance
metric(s) to determine the amount of the Incentive Award that is
earned:
Performance Metric
Actual as % of Plan
|
% of Award Target Value Earned
|
|
200.0% or greater
|
200%
|
|
0%
- 199.9%
|
Same
percentage (0% - 199.9%) as
Actual
Performance compared to Plan
|
Illustration
of Payment Calculation:
[Award
Target Value]
|
X
|
[%
of Award Target
Value
Earned]
|
=
|
[Incentive
Award
Earned]
|
In
order
to earn any Incentive Award, you must remain continuously employed by Employer
through the end of the performance period (March 3, 2012), except as provided
in
the Award Agreement.
18
Exhibit
A
Waiver
and General Release
(California)
1. In
consideration for severance benefits payable to Employee under Section 9.5.2
of
that certain Employment Agreement (“Agreement”)
dated
and effective as of September 14, 2008, by and between Napster, Inc., a Delaware
corporation, (“Employer”)
and
[_______], an individual resident of the State of California (“Employee”),
Employee, on his own behalf and on behalf of his heirs, successors, assigns,
and
attorneys agrees to forever and does forever give up, release, and discharge
any
and all known and unknown claims, demands, actions, liability, damages, and/or
rights of any kind that he has and/or may have from the beginning of time
through the date that he signs this Waiver and General Release, against Employer
or Best Buy Co., Inc., a Minnesota corporation (“Best
Buy”),
and/or any former and current parents, affiliates, subsidiaries, related
companies, predecessors, successors, assigns, officers, directors, shareholders,
employees, agents, attorneys, consultants, insurers, and other representatives
of Employer or Best Buy (all such entities and persons hereafter being referred
to collectively in this Waiver and General Release as “Released
Parties”).
Employee’s release includes, but is not limited to, the following areas or types
of claims: Title VII of the Civil Rights Act of 1964; the Age Discrimination
in
Employment Act, as amended; the Civil Rights Act of 1991; the Americans with
Disabilities Act of 1990; the Family and Medical Leave Act of 1993; the Equal
Pay Act; 42 U.S.C. §§ 1981, 1983 & 1985; the Older Workers’ Benefits
Protection Act; California Xxxxx Civil Right Act, The California Family Rights
Act (Govt. Code § 12945.2 et. seq.), the California Fair Employment and
Housing Act (Govt. Code § 12900 et. seq.), as amended; failure to
accommodate; reprisal; retaliation; retaliatory discharge; invasion of privacy;
personal injury of any kind; breach of contract; unjust enrichment; tortious
interference with contract; libel; slander; defamation; wrongful termination
of
employment; intentional infliction of emotional distress; negligent infliction
of emotional distress; negligent hiring; negligent retention; negligent
supervision; any other negligence; vicarious liability; assault; battery;
promissory estoppel; equitable estoppel; compensatory damages, liquidated or
punitive damages, damages for emotional distress or pain and suffering, back
pay, front pay, attorneys’ fees, costs, and/or disbursements, unpaid benefits;
any other statutory, tort, civil rights, contractual, and/or common law claims;
and all claims arising out of and/or related to Employer or Best Buy, including
matters concerning Employee’s employment.
Notwithstanding
anything to the contrary in this Waiver and General Release, this release does
not include (i) Employee’s right to seek unemployment compensation benefits
and/or any other benefits that cannot by law be waived and/or released; (ii)
Employee’s rights with respect to equity-based awards previously granted by Best
Buy or its affiliates to Employee, to the extent that such awards continue
after
the termination of Employee’s employment in accordance with the applicable terms
of such awards (and subject to any limited period in which to exercise such
awards following such termination of employment); (iii) Employee’s rights to
indemnification and/or payment of attorneys’ fees and expenses pursuant to the
Agreement or the Employer’s (or any of its affiliates’) articles of
incorporation, bylaws, or other organizational documents, under any written
indemnification agreement, or under applicable law; (iv) any rights Employee
may
have to insurance coverage for any losses, damages or expenses (including,
but
not limited to, attorneys’ fees, to the extent otherwise provided) that Employee
may in the future incur with respect to his or her service as an employee,
director, or officer of the Employer or any of its affiliates; (v) any rights
to
continued medical or dental coverage that Employee may have under COBRA (or
similar applicable state law); (vi) Employee’s rights to the severance and other
benefits payable under Section 9.5.2 and Section 9.5.3 of the Agreement in
accordance with the terms of the Agreement; and (vii) any rights to payment
of
vested benefits that Employee may have under a retirement or other benefit
plan
sponsored or maintained by Best Buy or its affiliates. Employee does not waive
any claims that may arise after he signs this Waiver and General
Release.
19
2. Employee
certifies, acknowledges and agrees that he has been afforded and received from
Employer and Best Buy all rights, entitlements and protections due him in
accordance with the Family and Medical Leave Act of 1993 (“FMLA”)
as of
the date of this Waiver and General Release, and at all times before, and that
he has suffered no harm, injury, damages, or losses compensable under the FMLA;
nor does he have a legal claim, demand, cause of action or right of recovery
under the FMLA as against Employer or Best Buy as of the date of this Waiver
and
General Release.
Employee
also certifies that he has received all wages earned by him and owed to him
by
Best Buy, including but not limited to all earned vacation, paid time off,
bonuses, commissions, overtime, expenses or other earnings or payments owed,
less appropriate withholdings, through the date he signs this Waiver and General
Release.*
3. In
furtherance of Employee’s waiver, release, acquittal and discharge of the
Released Parties from “any and all claims, actions, charges, complaints,
grievances and causes of action of whatever nature, whether
now known or unknown,”
Employee agrees that he fully and forever waives any and all rights and benefits
conferred upon him by the provisions of California Civil Code Section 1542
which
states as follows (parentheticals added):
A
GENERAL
RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR (e.g.,
Employee)
DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR
HER
SETTLEMENT WITH THE DEBTOR (e.g.,
Employer).
Employee
understands that this means that if, after the Effective Date of this General
Release, he discovers facts different from or in addition to those that he
now
knows or believes to be true, his waiver, release, acquittal and discharge
of
this General Release shall be effective and shall remain effective in all
respects notwithstanding such different or additional facts or his later
discovery of such different or additional facts.
4. Employee
agrees and represents that it is within his contemplation that he may have
Claims against the Released Parties of which, at the time of the execution
of
this Waiver and General Release, he has no knowledge or suspicion, but he agrees
and acknowledges that this Waiver and General Release extends to all Claims
in
any way based upon, connected with or related to his employment, the cessation
of his employment, whether or not known, claimed or suspected by him
.
5. Employee
understands that he has the right to sign this Waiver and General Release at
any
time within twenty-one (21) calendar days from his receipt of this document.
Upon execution, Employee must promptly send this document by overnight mail
to
_____________________________________. A copy may be retained by Employee.
Employee also understands that if he signs this Waiver and General Release,
he
has the right to revoke the Waiver and General Release at any time within seven
(7) calendar days of his signing it, not including the date of his signing.
Any
Notice of Revocation shall be given in writing and sent by overnight mail no
later than the seventh (7th)
day
following the date Employee signs this Waiver and General Release. The Notice
of
Revocation shall be sent to _____________________. Employee knows that if he
rescinds or revokes this Waiver and General Release, he will not receive the
severance benefits from Employer or Best Buy that
are
conditioned on
this
Waiver and General Release
becoming
effective.
*
Modify
if all wages, including but not limited to all earned vacation, paid time off,
bonuses, commissions, overtime, expenses or other earnings or payments owed,
less appropriate withholdings, through the date of the Waiver and General
Release have not, in fact, been paid.
20
6. Employee
understands and agrees that, notwithstanding anything to the contrary in this
Waiver and General Release, nothing in this Waiver and General Release is
intended to and/or shall: (a) impose any condition, penalty, or other limitation
affecting Employee’s right to challenge this Waiver and General Release; (b)
constitute an unlawful release or waiver of any of Employee’s rights under any
laws; or (c) prevent, impede, or interfere with Employee’s ability or right to:
(1) provide truthful testimony if under subpoena to do so; or (2) to respond
as
otherwise required and/or provided for by law. Notwithstanding anything to
the
contrary in any paragraph of this Waiver and General Release, nothing in this
Waiver and General Release is intended to be or shall be construed as a
violation of any law.
Employee
also understands and agrees that, notwithstanding anything to the contrary
in
this Waiver and General Release, nothing in this Waiver and General Release
is
intended to or shall prevent, impede, or interfere with Employee’s ability or
right to file any charge or complaint with, or participate in an investigation
or proceeding conducted by the Equal Employment Opportunity Commission, the
California Department of Fair Employment and Housing, and/or any other
governmental entity. However, in consideration for the severance benefits
provided by Employer or Best Buy, Employee agrees to give up, release,
discharge, and waive any right he has and/or may have to any victim-specific
relief (including monetary relief) from Employer or Best Buy for any charge,
claim, or complaint filed by him or filed on his behalf by the Equal Employment
Opportunity Commission, the California Department of Fair Employment and
Housing, and/or any other governmental agency.
21
Exhibit
B
Form
of Award Agreement for Long-Term Incentive Award
[See
separate document]
22
Exhibit
C
Form
of Stock Option Award Agreement
[See
separate document]
23
BEST
BUY CO., INC.
LONG-TERM
INCENTIVE AWARD AGREEMENT
Award
Date: [__________], 2008
I. |
The
Award.
As of the Award Date set forth above, Best Buy Co., Inc. (“Best Buy”)
grants to you, [________], the right to earn a long-term incentive
award
(the “Incentive Award”), on the terms and subject to the conditions
contained in this Award Agreement (this “Agreement”). This Agreement is
the Long-Term Incentive Award contemplated by Section 5.4 of that
Employment Agreement by and between Napster, Inc. (“Napster”) and
[_________], dated as of September [ ], 2008, and Schedule 5.4 thereto.
Capitalized terms not defined in the body of this Agreement are defined
in
the Addendum to this Agreement.
|
II. |
Incentive
Award
|
2.1
|
Right
to Future Payment of Incentive Award.
You have been awarded the right to receive an Incentive Award upon
satisfaction of the terms and conditions contained in this Section
II. The
Award Target Value is $[_____]. You may earn an Incentive Award equal
to
0% - 200% of the Award Target Value based on achievement of
Performance Criteria as provided in Section 2.2. The Incentive Award
will
be payable in cash when, if and to the extent the Incentive Award
is
earned as provided in this Section
II.
|
2.2
|
Performance
Period; Performance Criteria.
The Incentive Award may be earned during the period (for purposes
of this
Section II, the “Performance Period”) beginning on March 1, 2009 and
ending on March 3, 2012 (the “Performance Target Date”), subject to the
provisions of Section 2.4 below. The Incentive Award will become
payable
as of the Performance Target Date if and to the extent the Performance
Criteria set forth in the attached Performance Criteria Schedule
have been
met. If and to the extent the Performance Criteria are not met as
of the
Performance Target Date, as set forth in the Performance Criteria
Schedule, your right to receive the Incentive Award will be immediately
forfeited. At the end of the Performance Period, the Controllership
Team
will measure and/or validate actual results with respect to each
performance metric and will determine in its sole discretion whether
and
the extent to which the Performance Criteria are met. The Controllership
Team’s determination shall be final, conclusive and binding upon you.
Any
Incentive Award to which you become entitled under this paragraph
will be
payable to you within thirty (30) calendar days after the Performance
Target Date.
|
2.3
|
Restrictions.
Your right to receive the Incentive Award is subject to the following
restrictions during the Performance
Period:
|
(a)
|
Your
right to receive the Incentive
Award is
subject to forfeiture as provided in this
Agreement.
|
(b)
|
Your
right to receive the Incentive
Award may
not be sold, assigned, transferred or pledged during the Performance
Period. You may not transfer the right to receive the Incentive
Award,
other than by will or the laws of descent and distribution, and any
such
attempted transfer will be void.
|
2.4
|
Forfeiture/Acceleration.
|
(a)
|
If,
prior to the Performance Target Date, your employment is terminated
by
reason of death or because you become Disabled, you will be entitled
to
receive an Incentive Award equal to 100% of the Award Target Value,
regardless of whether the Performance Criteria have been met. Such
Incentive Award will be payable to you within thirty (30) calendar
days
after the termination date of your
employment.
|
(b)
|
If,
prior to the Performance Target Date, your employment is terminated
by
Napster without Cause or you terminate your employment with Napster
for
Good Reason, the Performance Period will continue and you will be
entitled
to receive an Incentive Award equal to a pro-rata portion, based
on the
number of Whole Months you served during the Performance Period,
of the
Incentive Award that otherwise would have been earned in accordance
with
the Performance Criteria Schedule as of the Performance Target Date.
Any
Incentive Award to which you become entitled under this paragraph
will be
payable to you within thirty (30) calendar days after the Performance
Target Date.
|
(c)
|
If
your employment is terminated during the Performance Period for any
other
reason, your rights to any Incentive Award will be immediately and
irrevocably forfeited.
|
2.5
|
Income
Taxes.
You are liable for any federal and state income or other taxes applicable
upon the vesting and payment of the Incentive Award, and you acknowledge
that you should consult with your own tax advisor regarding the applicable
tax consequences. Upon the payment of the Incentive Award, Best Buy
will
withhold from the Incentive Award all applicable taxes required by
Best
Buy to be withheld from such
payment.
|
III. |
Confidentiality.
You
acknowledge that Best Buy operates in a competitive environment and
that
Best Buy has a substantial interest in protecting its Confidential
Information, and in consideration of this Incentive Award, you agree,
during your employment by Best Buy and thereafter, to maintain the
confidentiality of Best Buy’s Confidential Information and to use such
Confidential Information for the exclusive benefit of Best Buy, all
in
accordance with Section 6 of the Employment
Agreement.
|
IV. |
Terms
and Conditions.
This Agreement does not guarantee your continued employment or alter
the
right of Best Buy or its Affiliates to terminate your employment
at any
time.
|
By:
|
|
EMPLOYEE:
|
|
[_________]
|
2
ADDENDUM
TO
LONG-TERM
INCENTIVE AWARD AGREEMENT
For
the
purposes hereof the terms used herein will have the following
meanings:
"Affiliate"
will mean a company controlled directly or indirectly by Best Buy, where
"control" will mean the right, either directly or indirectly, to elect a
majority of the directors thereof without the consent or acquiescence of any
third party.
"Beneficial
Owner" will have the meaning defined in Rule 13d-3 promulgated under the
Securities Exchange Act of 1934, as amended.
“Cause”
for termination of your employment will mean the occurrence of one or more
of
the following events:
(i)
|
dishonesty
in the performance of your duties for Napster or its Affiliates;
|
(ii)
|
your
knowing and material violation of policies and procedures of Napster
in
effect from time to time which results in a material adverse effect
on
Napster and which, to the extent a cure is reasonably possible, remains
uncured ten (10) days after written notice of such violation is given
to
you;
|
(iii)
|
your
willful and continued failure to satisfactorily perform, or your
gross
negligence in the performance of, your duties after receipt of written
notice that specifically identifies the areas in which your performance
is
deficient and which remains uncured thirty (30) days after such written
notice is given to you;
|
(iv)
|
willful
actions (or willful failures to act) in bad faith by you with respect
to
Best Buy or its Affiliates that materially impair Napster’s business,
goodwill or reputation;
|
(v)
|
your
conviction of a felony or any crime involving an act of dishonesty,
moral
turpitude, deceit or fraud, or the commission of acts that would
reasonably be expected to result in such
conviction;
|
(vi)
|
your
current use of illegal substances;
or
|
(vii)
|
any
material violation by you of any agreement to which you and Napster
or any
Affiliate of Napster are parties which remains uncured ten (10) days
after
written notice of such violation is given to
you.
|
A
"Change
of Control" will be deemed to have occurred if the conditions set forth in
any
one of the following paragraphs will have been satisfied:
(i)
|
any
Person is or becomes the Beneficial Owner, directly or indirectly,
of
securities of Best Buy representing 50% or more of the combined voting
power of Best Buy's then outstanding securities excluding, at the
time of
their original acquisition, from the calculation of securities
beneficially owned by such Person, any securities acquired directly
from
Best Buy or its Affiliates or in connection with a transaction described
in clause (a) of paragraph III below;
or
|
(ii)
|
individuals
who at the Award Date constitute the Board and any new director (other
than a director whose initial assumption of office is in connection
with
an actual or threatened election contest, including but not limited
to a
consent solicitation, relating to the election of directors of Best
Buy)
whose appointment or election by the Board or nomination for election
by
Best Buy's shareholders was approved or recommended by a vote of
at least
two-thirds (2/3) of the directors then still in office who either
were
directors at the Award Date or whose appointment, election or nomination
for election was previously so approved or recommended, cease for
any
reason to constitute a majority thereof;
or
|
A-1
(iii)
|
there
is consummated a merger or consolidation of Best Buy with any other
company, other than (a) a merger or consolidation which would result
in
the voting securities of Best Buy outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity or any parent
thereof), in combination with the ownership of any trustee or other
fiduciary holding securities under an employee benefit plan of Best
Buy or
any Affiliate, at least 50% of the combined voting power of the voting
securities of Best Buy or such surviving entity or parent thereof
outstanding immediately after such merger or consolidation, or (b)
a
merger or consolidation effected to implement a recapitalization
of Best
Buy (or similar transaction) in which no Person is or becomes the
Beneficial Owner, directly or indirectly of securities of Best Buy
representing 50% or more of the combined voting power of Best Buy's
then
outstanding securities; or
|
(iv)
|
the
shareholders of Best Buy approve a plan of complete liquidation of
Best
Buy or there is consummated an agreement for the sale or disposition
by
Best Buy of all or substantially all Best Buy's assets, other than
a sale
or disposition by Best Buy of all or substantially all of Best Buy’s
assets to an entity, at least 50% of the combined voting power of
the
voting securities of which are owned by shareholders of Best Buy
in
substantially the same proportions as their ownership of Best Buy
immediately prior to such sale; or
|
(v)
|
the
Board determines in its sole discretion that a change in control
of Best
Buy has occurred.
|
Notwithstanding
the foregoing, a “Change in Control” will not be deemed to have occurred by
virtue of the consummation of any transaction or series of integrated
transactions immediately following which the record holders of the common stock
of Best Buy immediately prior to such transaction or series of transactions
continue to have substantially the same proportionate ownership in an entity
which owns all or substantially all of the assets of Best Buy immediately
following such transaction or series of transactions.
“Controllership
Team” will mean a group that regularly exercises accounting controllership
functions and reports to or operates under the direction of Best Buy’s principal
accounting officer.
"Disabled"
will mean that you are unable to perform any of the material and substantial
duties of your regular occupation due to a sickness or injury, and such
inability to perform continues for at least six consecutive months. You will
be
deemed disabled for the purposes hereof if you have qualified for long term
disability payments under a long term disability plan maintained by Napster
or,
if Napster does not have a long term disability plan in effect at such time,
if
you would have qualified for long term disability payments under Best Buy's
long
term disability plan had you then been an employee of Best Buy.
“Employment
Agreement” will mean that Employment Agreement by and between Napster, Inc. and
[_______], dated as of September [ ], 2008
“Good
Reason” for your resignation from employment with Napster will
mean:
(i)
|
a
forced relocation of the place for your performance of duties reasonably
requiring a move in your residence;
|
(ii)
|
a
material breach by Napster or its Affiliates of the Employment Agreement
or any other agreement under which you provide services to Napster
or its
Affiliates;
|
(iii)
|
conduct
by Napster that could reasonably be expected to expose you to material
personal liability or other material adverse legal consequences;
or
|
(iv) |
a
material diminution of your base compensation or of the nature or
scope of
your duties or responsibilities in effect immediately after the Effective
Date with respect to the business conducted by Napster, whether Napster
remains a separate corporation, is combined with Best Buy or one
of its
Affiliates, or becomes an operating division of Best Buy or one of
its
Affiliates.
|
A-2
Notwithstanding
the foregoing, however, any condition or conditions otherwise set forth above
shall not constitute Good Reason for termination unless both (a) you
provide written notice to Napster of the condition claimed to constitute grounds
for Good Reason within ninety (90) days of the initial existence of such
condition, and (b) the condition is not remedied within thirty (30) days of
such notice. In addition, in all events the termination of your employment
shall
not constitute a termination for Good Reason unless such termination occurs
less
than one (1) year following the initial existence of the condition claimed
to
constitute grounds for Good Reason.
"Person"
will have the meaning defined in Sections 3(a)(9) and 13(d) of the Securities
Exchange Act of 1934, as amended, except that such term will not include (i)
Best Buy or any of its subsidiaries, (ii) a trustee or other fiduciary holding
securities under an employee benefit plan of Best Buy or any of its Affiliates,
(iii) an underwriter temporarily holding securities pursuant to an offering
of
such securities, or (iv) a corporation owned, directly or indirectly, by the
shareholders of Best Buy in substantially the same proportions as their
ownership of stock of Best Buy.
“Whole
Month” will mean a fiscal month in which you have been employed by Best Buy or
one or more of its Affiliates for at least 15 days.
A-3
PERFORMANCE
CRITERIA SCHEDULE TO
LONG-TERM
INCENTIVE AWARD AGREEMENT
Award
Date: [__________], 2008
Incentive
Award Vesting
The
Performance Period is March 1, 2009 through March 3, 2012. The amount of the
Incentive Award earned is determined based on the following
metrics:
· [performance
metric #1]
· [performance
metric #2]
The
Incentive Award may be earned based on achievement of Performance Goals
established for each metric, as described in the tables below. No vesting will
occur prior to the Performance Target Date, except as specifically provided
in
the Agreement.
Performance
Goal #1 – [performance metric]
[describe
performance goals and measurement]
Performance
Goal # 2 – [performance metric]
[describe
performance goals and measurement]
A-4
BEST
BUY CO., INC.
STOCK
OPTION AWARD AGREEMENT
Award
Date: [ ]
I. |
The
Award.
As of the Award Date set forth in the Award Notification accompanying
this
award, Best Buy Co., Inc. (“Best Buy”) grants to you an option to purchase
the number of shares of Best Buy common stock set forth in such Award
Notification (the “Option”) at the option price per share set forth in
such Award Notification on the terms and conditions contained in
this
Long-Term Incentive Program Award Agreement (this “Agreement”) and the
Best Buy Co., Inc. 2004 Omnibus Stock and Incentive Plan (the “Plan”).
This Agreement is the Stock Option Award contemplated by Section
5.5 of
that Employment Agreement by and between Napster, Inc. (“Napster”) and
[_______], dated as of September [ ], 2008. Capitalized terms not
defined
in the body of this Agreement are defined in the
Addendum.
|
II. |
Option
|
2.1
|
Duration
and Exercisability of Option.
You may not exercise any portion of the Option prior to one year
from the
Award Date, and the Option expires 10 years after the Award Date
(the
“Expiration Date”). You may exercise the Option in cumulative installments
of 25% on and after each of the first four anniversaries of the Award
Date. The entire Option will vest earlier and become exercisable
upon your
Qualified Retirement, Disability or death or if, within 12 months
following a Change of Control, your employment is terminated without
Cause
or you terminate your employment for Good Reason. The Option may
only be
exercised by you during your lifetime, and may not be assigned or
transferred other than by will or the laws of descent and
distribution.
|
2.2
|
Exercise
and Tax Withholding. The
Option may be exercised in whole or in part by notice to Best Buy
(through
the Plan administrator or other means as shall be specified by Best
Buy
from time-to-time) stating the number of shares to be purchased under
the
Option and the method of payment. The notice must be accompanied
by
payment in full of the exercise price for all shares designated in
the
notice. Payment of the exercise price may be made by cash, check
or
delivery of previously owned shares of stock having a Fair Market
Value
(as defined in the Plan) on the date of exercise equal to the exercise
price, or a combination thereof. The Option will not be eligible
for
treatment as a qualified or incentive stock option for federal income
tax
purposes. You are liable for any federal and state income or other
taxes
applicable upon the grant or exercise of the Option or the disposition
of
the underlying shares, and you acknowledge that you should consult
with
your own tax advisor regarding the applicable tax consequences. Upon
exercise of the Option, Best Buy will withhold from the shares that
would
otherwise be delivered to you a number of shares having a fair market
value equal to the amount of all applicable taxes required by Best
Buy to
be withheld or collected upon the exercise of the Option, unless
your
notice of exercise indicates your desire to satisfy such withholding
obligations through the payment of cash or the delivery of previously
acquired shares of Best Buy common stock, and such cash or shares
are
delivered to Best Buy promptly thereafter. You have no rights in
the
shares subject to the Option until such shares are received upon
exercise
of the Option.
|
2.3
|
Retirement,
Disability, Death or Termination. Your
employment with the Company Group may be terminated by your employer
at
any time for any reason (or no reason). If your employment is terminated
by the Company Group without Cause or if you resign or otherwise
voluntarily terminate your employment with the Company Group, you
will
have 60 days from the date of your termination to exercise the Option,
to
the extent the Option had vested as of your termination date. Upon
your
Qualified Retirement from the Company Group, you will have one year
from
the effective date of your retirement to exercise the Option. If
you die
while employed by the Company Group, the representative of your estate
or
your heirs will have one year from the date of your death to exercise
the
Option. If you become Disabled while employed with the Company Group,
you
will have one year from the effective date of such classification
to
exercise the Option. In no case, however, may the Option be exercised
after the Expiration Date. The Option may not be exercised following
termination of your employment with the Company Group for
Cause.
|
2.4
|
Income
Taxes.
Best Buy shall have the right to deduct from all payments made under
this
Agreement any federal, state, or local taxes required by law to be
withheld with respect to such payments.
|
III. |
Terms
and Conditions.
This Agreement does not guarantee your continued employment or alter
the
right of the Company Group to terminate your employment at any time.
This
Award is granted pursuant to the Plan and is subject to its terms.
In the
event of any conflict between the provisions of this Agreement and
the
Plan, the provisions of the Plan will govern.
By
your acceptance of this award, you acknowledge receipt of a copy
of the
Prospectus for the Plan and your agreement to the terms and conditions
of
the Plan and this Agreement.
|
BEST
BUY CO., INC.
|
|
By:
|
ADDENDUM
TO
STOCK
OPTION AWARD AGREEMENT
For
the
purposes hereof the terms used herein will have the following
meanings:
"Affiliate"
will mean a company controlled directly or indirectly by Best Buy, where
"control" will mean the right, either directly or indirectly, to elect a
majority of the directors thereof without the consent or acquiescence of any
third party.
"Beneficial
Owner" will have the meaning defined in Rule 13d-3 promulgated under the
Securities Exchange Act of 1934, as amended.
“Cause”
for termination of your employment will mean the occurrence of one or more
of
the following events:
(i)
|
dishonesty
in the performance of your duties for Napster or its Affiliates;
|
(ii)
|
your
knowing and material violation of policies and procedures of Napster
in
effect from time to time which results in a material adverse effect
on
Napster and which, to the extent a cure is reasonably possible, remains
uncured ten (10) days after written notice of such violation is given
to
you;
|
(iii)
|
your
willful and continued failure to satisfactorily perform, or your
gross
negligence in the performance of, your duties after receipt of written
notice that specifically identifies the areas in which your performance
is
deficient and which remains uncured thirty (30) days after such written
notice is given to you;
|
(iv)
|
willful
actions (or willful failures to act) in bad faith by you with respect
to
Best Buy or its Affiliates that materially impair Napster’s business,
goodwill or reputation;
|
(v)
|
your
conviction of a felony or any crime involving an act of dishonesty,
moral
turpitude, deceit or fraud, or the commission of acts that would
reasonably be expected to result in such
conviction;
|
(vi)
|
your
current use of illegal substances;
or
|
(vii)
|
any
material violation by you of any agreement to which you and Napster
or any
Affiliate of Napster are parties which remains uncured ten (10) days
after
written notice of such violation is given to
you.
|
A
"Change
of Control" will be deemed to have occurred if the conditions set forth in
any
one of the following paragraphs will have been satisfied:
(i)
|
any
Person is or becomes the Beneficial Owner, directly or indirectly,
of
securities of Best Buy representing 50% or more of the combined voting
power of Best Buy's then outstanding securities excluding, at the
time of
their original acquisition, from the calculation of securities
beneficially owned by such Person, any securities acquired directly
from
Best Buy or its Affiliates or in connection with a transaction described
in clause (a) of paragraph III below;
or
|
(ii)
|
individuals
who at the Award Date constitute the Board and any new director (other
than a director whose initial assumption of office is in connection
with
an actual or threatened election contest, including but not limited
to a
consent solicitation, relating to the election of directors of Best
Buy)
whose appointment or election by the Board or nomination for election
by
Best Buy's shareholders was approved or recommended by a vote of
at least
two-thirds (2/3) of the directors then still in office who either
were
directors at the Award Date or whose appointment, election or nomination
for election was previously so approved or recommended, cease for
any
reason to constitute a majority thereof;
or
|
(iii)
|
there
is consummated a merger or consolidation of Best Buy with any other
company, other than (a) a merger or consolidation which would result
in
the voting securities of Best Buy outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity or any parent
thereof), in combination with the ownership of any trustee or other
fiduciary holding securities under an employee benefit plan of Best
Buy or
any Affiliate, at least 50% of the combined voting power of the voting
securities of Best Buy or such surviving entity or parent thereof
outstanding immediately after such merger or consolidation, or (b)
a
merger or consolidation effected to implement a recapitalization
of Best
Buy (or similar transaction) in which no Person is or becomes the
Beneficial Owner, directly or indirectly of securities of Best Buy
representing 50% or more of the combined voting power of Best Buy's
then
outstanding securities; or
|
(iv)
|
the
shareholders of Best Buy approve a plan of complete liquidation of
Best
Buy or there is consummated an agreement for the sale or disposition
by
Best Buy of all or substantially all Best Buy's assets, other than
a sale
or disposition by Best Buy of all or substantially all of Best Buy’s
assets to an entity, at least 50% of the combined voting power of
the
voting securities of which are owned by shareholders of Best Buy
in
substantially the same proportions as their ownership of Best Buy
immediately prior to such sale; or
|
(v)
|
the
Board determines in its sole discretion that a change in control
of Best
Buy has occurred.
|
Notwithstanding
the foregoing, a “Change in Control” will not be deemed to have occurred by
virtue of the consummation of any transaction or series of integrated
transactions immediately following which the record holders of the common stock
of Best Buy immediately prior to such transaction or series of transactions
continue to have substantially the same proportionate ownership in an entity
which owns all or substantially all of the assets of Best Buy immediately
following such transaction or series of transactions.
“Committee”
will mean the Compensation and Human Resources Committee of the Board of
Directors of Best Buy or any other committee of the Board designated by the
Board to administer the Plan.
“Company
Group” will mean, collectively, Best Buy and its Affiliates.
"Disabled"
will mean that you are unable to perform any of the material and substantial
duties of your regular occupation due to a sickness or injury, and such
inability to perform continues for at least six consecutive months. You will
be
deemed disabled for the purposes hereof if you have qualified for long term
disability payments under a long term disability plan maintained by Napster
or,
if Napster does not have a long term disability plan in effect at such time,
if
you would have qualified for long term disability payments under Best Buy's
long
term disability plan had you then been an employee of Best Buy.
“Employment
Agreement” will mean that Employment Agreement by and between Napster, Inc. and
[_______], dated as of September [ ], 2008
“Good
Reason” for your resignation from employment with Napster will
mean:
(i)
|
a
forced relocation of the place for your performance of duties reasonably
requiring a move in your residence;
|
(ii)
|
a
material breach by Napster or its Affiliates of the Employment Agreement
or any other agreement under which you provide services to Napster
or its
Affiliates;
|
(iii)
|
conduct
by Napster that could reasonably be expected to expose you to material
personal liability or other material adverse legal consequences;
or
|
(iv) |
a
material diminution of your base compensation or of the nature or
scope of
your duties or responsibilities in effect immediately after the Effective
Date with respect to the business conducted by Napster, whether Napster
remains a separate corporation, is combined with Best Buy or one
of its
Affiliates, or becomes an operating division of Best Buy or one of
its
Affiliates.
|
Notwithstanding
the foregoing, however, any condition or conditions otherwise set forth above
shall not constitute Good Reason for termination unless both (a) you
provide written notice to Napster of the condition claimed to constitute grounds
for Good Reason within ninety (90) days of the initial existence of such
condition, and (b) the condition is not remedied within thirty (30) days of
such notice. In addition, in all events the termination of your employment
shall
not constitute a termination for Good Reason unless such termination occurs
less
than one (1) year following the initial existence of the condition claimed
to
constitute grounds for Good Reason.
"Person"
will have the meaning defined in Sections 3(a)(9) and 13(d) of the Securities
Exchange Act of 1934, as amended, except that such term will not include (i)
Best Buy or any of its subsidiaries, (ii) a trustee or other fiduciary holding
securities under an employee benefit plan of Best Buy or any of its Affiliates,
(iii) an underwriter temporarily holding securities pursuant to an offering
of
such securities, or (iv) a corporation owned, directly or indirectly, by the
shareholders of Best Buy in substantially the same proportions as their
ownership of stock of Best Buy.
"Qualified
Retirement" will mean any termination of employment for retirement on or after
age 60, so long as the employee has served Best Buy continuously for at least
the three (3) years immediately preceding the retirement.