Exhibit 10.11


 


GameFly, Inc.


5340 ALLA ROAD #110


LOS ANGLES, CA 90066


 


January 26, 2010


 


Alison Davis

1 Maritime Plaza

Suite 825

San Francisco, CA 94111


 


Dear Alison:


 


Pursuant to this letter agreement (the “Agreement”), GameFly, Inc.
(the “Company”) is pleased to offer you a position as a member of the Company’s
Board of Directors (the “Board”), effective as of the date of the first Board
meeting on which the Board has appointed you as a Board member.  You will also serve as a member of the
Company’s Compensation Committee and Audit Committee and as Chairperson of the
Audit Committee when appointed by the Board. 
As a Board and Committee member, you will be responsible for attending
any scheduled Board and Committee meetings in person or by telephone.  In addition, from time to time, we would like
to have the benefit of your experience and insight regarding various Company
related matters through telephone and email communications.


 


At the beginning of each calendar quarter in which you
will provide Board and Committee service, you will receive a fee of $7,500 for a
total annual fee of $30,000.  Such fee
will be prorated for your first quarter of service, based on the number of days
of service that you provide during such first quarter.  In addition, subject to Board approval, you
will be granted an option to purchase 60,000 shares of the Company’s Common
Stock (the “Option”). The exercise price per share of the Option will be equal
to the fair market value per share on the date the Option is granted, as determined
by the Board in good faith.  There is no
guarantee that the Internal Revenue Service will agree with this value.  You should consult with your own tax advisor
concerning the tax consequences associated with accepting the Option. The
Option will become vested and exercisable with respect to 1/48th of the Option
shares upon your completion of each month of service with the Company.  In the event of a change in control
transaction while you are a Board member, 25% of the Option will become fully
vested and exercisable immediately prior to the transaction.  The Option will be subject to the terms and
conditions of the Company’s 2002 Stock Plan (the “Plan”) and the applicable
stock option agreement.


 


The Company will
reimburse reasonable travel and other business expenses in connection with your
duties as a Board member in accordance with the Company’s generally applicable
policies.  In addition, you will receive
certain indemnification rights with respect to your service as a Board member,
provided that you execute the Company’s form of indemnification agreement.


 


In connection with your
Board service, we expect that the Company and its agents


 

















 


will
disclose technical, business, or financial information to you, including (without
limitation) the identity of and information relating to customers or employees
and information the Company has received and in the future will receive from
third parties that is subject to a duty from the Company to maintain the
confidentiality of such information and to use it only for certain limited
purposes (“Confidential Information”). 
To the extent such Confidential Information is not generally publicly
known or otherwise previously known by you without an obligation of
confidentiality, you agree not to use such Confidential Information (except in
connection with your Board or Committee services) or disclose such Confidential
Information to any third party and to take reasonable steps to maintain the
confidential nature of such Confidential Information.   When you cease to be a Board member, you
must return all Confidential Information to the Company.


 


As a precautionary matter
and to avoid any conflicts of interest, we ask that while this Agreement is in
effect that you do not provide advice to or otherwise provide services to any
Company competitor.  In addition, we ask
that you inform the Company of any potential, actual, direct or indirect
conflict of interest that you think exists or may arise as a result of your
relationship with Company, so that we may come to a quick and mutually
agreeable resolution. By signing this Agreement you also represent and warrant
that neither this Agreement nor the performance thereof will conflict with or
violate any obligation of yours or right of any third party, and further that
you will not disclose any third party proprietary or confidential information
to the Company in connection with your Board services.


 


This Agreement shall be
governed by and construed under the laws of the State of California without
regard to principles of conflicts of laws. 
The foregoing constitutes the complete agreement between us with respect
to the subject matter hereof and supersede in all respects all prior or
contemporaneous proposals, negotiations, conversations, discussions and
agreements between us.


 


I am excited about you
joining our Board and Committees and look forward to working with you to help
make the Company a truly great and prosperous company.  Please acknowledge your receipt of and
agreement with this Agreement by signing and dating this Agreement and
returning it to me no later than January 29, 2010.


 


***Signature
Page Follows***


 


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  Very
  truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  GAMEFLY, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ David Hodess

  
	
   

  	
   

  	
  Name: David Hodess

  
	
   

  	
   

  	
  Title: CEO and Member of Board

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ACCEPTED AND
  AGREED TO:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Alison Davis

  	
   

  	
   

  
	
  Alison Davis

  	
   

  	
   

  
	
  1/30/2010

  	
   

  	
   

  
	
  Date

  	
   

  	
   

  



 


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