Unassociated Document


    EMPLOYMENT
AGREEMENT

     

    AGREEMENT,
dated as of February 25, 2010, between GAME TRADING TECHNOLOGIES, INC., a
Delaware corporation (the "Company"), and the Executive identified on Exhibit A attached
hereto and incorporated by reference herein (the "Executive").

    


    WITNESSETH:

    


    WHEREAS,
the Company desires to retain the services of the Executive and to that end
desires to enter into a contract of employment with him, upon the terms and
conditions herein set forth;

    


    WHEREAS,
the Executive desires to be employed by the Company upon such terms and
conditions;

    


    NOW,
THEREFORE, in consideration of the premises and of the mutual benefits and
covenants contained herein, the parties hereto, intending to be bound, hereby
agree as follows:

    


    1.           APPOINTMENT AND
TERM

    


    Subject
to the terms hereof, the Company hereby employs the Executive, and the Executive
hereby accepts employment with the Company, all in accordance with the terms and
conditions set forth herein, for a period commencing on the date hereof (the
"Commencement Date") and ending on the date (the "Expiration Date"), and as may
be renewed or extended by the parties, all as set forth in Exhibit A (the
“Term”).

    


    2.           DUTIES

    


    (a)           During
the term of this Agreement, the Executive shall be employed in the position set
forth in Exhibit
A and shall, unless prevented by incapacity, devote substantially all of
his business time, attention and ability during normal corporate office business
hours to the discharge of his duties hereunder and to the faithful and diligent
performance of such duties and the exercise of such powers as may be assigned to
or vested in him by the Board of Directors of the Company (the "Board"), the
President and Chief Executive Officer of the Company and any other senior
executive officer of the Company, all such duties to be consistent with his
position.  The Executive shall obey the lawful directions of the
Board, the Company's President and Chief Executive Officer and any other senior
executive officer of the Company and the Executive shall use his diligent
efforts to promote the interests of the Company and to maintain and promote the
reputation thereof.

    


    (b)           The
Executive shall not during his term of employment (except as a representative of
the Company or with the consent in writing of the Board) be directly or
indirectly engaged or concerned or interested in any other business activity,
except through: (i) continued ownership and management of the Executive’s
current business interests, which are set forth on Exhibit B, which is
attached hereto and incorporated by reference herein; and (ii) ownership of an
interest of not more than 2% in any entity that does not compete with the
Company, provided it does not impair the ability of the Executive to discharge
fully and faithfully his duties hereunder.


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    (c)           Notwithstanding
the foregoing provisions, the Executive shall be entitled to serve in various
leadership capacities in civic, charitable and professional
organizations.  The Executive recognizes that his primary and
paramount responsibility is to the Company.

    


    (d)           The
Executive shall be based at current Company headquarters at 10957 McCormick
Road, Hunt Valley, Maryland 21031, or such other location in the greater
Baltimore area as the Board may determine, except for reasonably required travel
on the Company's business.

    


    3.           REMUNERATION

    


    (a)           As
compensation for his services pursuant hereto, the Executive shall be paid a
base salary during the first year of his employment hereunder at the annual rate
set forth in Exhibit
A.  Such salary shall be increased on each anniversary of the
Commencement Date during the term of employment by an amount equal to 5% of such
salary for the preceding one year period.  This amount shall be
payable in equal periodic installments in accordance with the usual payroll
practices of the Company.

    


    (b)           Except
as provided herein, and in the Securities Exchange Agreement among the Company
and Gamers Factory, Inc. and, for certain limited purposes, its stockholders
(including the Executive), dated as of February __, 2010 (the “Exchange
Agreement”) and in the Escrow Agreement (as hereinafter defined), the Executive
shall not be entitled to receive any additional compensation, remuneration or
other payments from the Company or the Parent.

    


    4.           HEALTH INSURANCE AND OTHER
FRINGE BENEFITS

    


    The
Executive shall be entitled to participate in the employee fringe benefit
programs listed on Exhibit A and such others programs or improvements to those
listed on Exhibit A as the Company and / or the Parent may adopt from time to
time.

    


    5.           VACATION

    


    The
Executive shall be entitled to the number of weeks of vacation set forth in
Exhibit A (in
addition to the usual national holidays) during each contract year during which
he serves hereunder.  Such vacation shall be taken at such time or
times as will be mutually and reasonably agreed between the Executive and the
Company.  Vacation not taken during a calendar year may not be accrued
and carried forward.

    


    6.           REIMBURSEMENT FOR
EXPENSES

    


    The
Executive shall be reimbursed for reasonable documented business expenses
incurred in connection with the business of the Company in accordance with
practices and policies established by the Company.


    
      
         


      

      
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    7.           TERMINATION

    


    (a)           For
purposes of this Agreement, the following terms shall have the following
definitions:

    


    (i)           “For
Cause” shall mean the termination of the employment of the Executive by the
Company and/or the Parent  because of any of the following: (A) the
willful and material malfeasance, dishonesty or habitual drug or alcohol abuse
by the Executive related to or affecting the performance of his duties (but with
respect to habitual drug or alcohol abuse, only after notice by the Company of
such habitual drug or alcohol abuse and the failure of the Executive to cure
such default as soon as practicable (but in any event within thirty (30) days
following written notice from the Company); (B) the Executive's continuing and
intentional breach, material non-performance or non-observance of any of the
material terms or provisions of this Agreement, but only after notice by the
Company of such breach, nonperformance or nonobservance and the failure of the
Executive to cure such default as soon as practicable (but in any event within
thirty (30) days following written notice from the Company); (C) the conduct by
the Executive which the Board in good faith determines could reasonably be
expected to have a material adverse effect on the business, assets, properties,
results of operations, financial condition, personnel or prospects of the
Company (within each category, taken as a whole), but only after notice by the
Company of such conduct and the failure of the Executive to cure same as soon as
practicable (but in any event within thirty (30) days following written notice
from the Company); or (D) upon the Executive's conviction of a felony, any crime
materially affecting the performance of his duties or any act of fraud,
embezzlement, theft or willful breach of fiduciary duty against the
Company.

     

    (ii)          “For
Good Reason” shall mean termination of employment as initiated by the Executive
on account of the occurrence of any of the following without the Executive’s
written consent: (A) a material diminution in the Executive’s base compensation
or fringe benefits; (B) a material downgrading of the Executive’s executive
power and responsibility within the Company; (C) a change in geographic location
at which the Executive must regularly perform services of more than fifty (50)
miles; or (C) from and after the second anniversary of this Agreement, any
Change of Control (as hereinafter defined). Anything to the contrary herein
notwithstanding, none of the forgoing events described in this section shall
constitute Good Reason unless the Executive gives notice to the Company of the
occurrence or existence of one of the events and the Company has not cured the
condition within thirty (30) days following receipt of such written
notice.

     

    (iii)         “Change
of Control” shall mean any of the following: (A) any person, other than the
Company or the Parent, its existing shareholders or any of its or their
affiliates on the date hereof, purchases the "beneficial ownership" (as defined
in Rule 13d-3 under the Securities Exchange Act of 1934), directly or
indirectly, of 50% or more of the combined voting power of voting securities
then ordinarily having the right to vote for directors of the Company; (B) there
shall be a sale of all or substantially all of the Company’s or the Parents’
assets; or (C) the Company or the Parent shall merge or consolidate with another
corporation and the stockholders of the Company or the Parent immediately prior
to such transaction do not own, immediately after such transaction, stock of the
purchasing or surviving corporation in this transaction (or of the parent
corporation of the purchasing or surviving corporation) possessing more than 50%
of the voting power (for the election of directors) of the outstanding stock of
that corporation, which ownership shall be measured without regard to any stock
of the purchasing, surviving or parent corporation owned by, the stockholders of
the Company or the Parent, as the case may be, before the
transaction.


    
      
         


      

      
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    (iv)         “Disability”
shall mean that the Executive, by reason of physical or mental disability, shall
be unable to perform the services required of him hereunder for a period of more
than 120 consecutive days, or for more than a total of 180 non-consecutive days
in the aggregate during any period of twelve (12) consecutive calendar
months.

    


    (b)           The
following terms and conditions shall apply if the employment of the Executive
with the Company is terminated: by the Company for any reason other than for
Cause; or by the Executive for Good Reason:

    


    (i)           The
Company shall pay to the Executive the full balance of the Executive’s base
compensation as set forth on Exhibit A for the
balance of the Term in accordance with the usual payroll practices of the
Company; provided that, should the Company fail to pay such compensation (having
missed at least four bi-monthly payments (whether or not consecutive)), the
Executive shall be released from all of the Restrictive Covenants (as
hereinafter defined).

    


    (ii)          For
one (1) year from and after the termination date, the Company shall continue
providing to the Executive the health and medical benefits described as such on
Exhibit
A.

    


    (iii)         If
the termination date occurs on or before the first anniversary of this
Agreement, the Company shall cause the Escrow Agent (as defined in the Escrow
Agreement, which Escrow Agreement is defined and described on Exhibit A) to release
to the Executive all of the Executive’s share of the Escrowed Shares (as defined
in the Escrow Agreement).

    


    (iv)         If
applicable, the Company shall use its best efforts to remove the Executive from
any personal guarantees under financing arrangements on behalf of the Company
and/or release any pledges made by the Executive of his personal property in
connection with financing arrangements on behalf of the Company, and, in the
event the Company has not caused such guarantees to be removed or pledges to be
released within six (6) months after the termination date, the Company shall
repay and extinguish the subject financing arrangement.

    


    (c)           The
following terms and conditions shall apply if the employment of the Executive
with the Company is terminated: by Disability; or death of the
Employee:

    


    (i)           The
Company shall pay to the Executive (or the estate of the Executive, as
applicable) the Executive’s base compensation through the end of the month in
which the Executive dies.


    
      
         


      

      
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    (ii)          In
the event of Disability only, for six (6) months from and after the termination
date, the Company shall continue providing to the Executive the health and
medical benefits described as such on Exhibit
A.

    


    (iii)         In
the event of Disability only, the Company shall reasonably assist and cooperate
with the Executive to obtain all applicable disability benefits.

    


    (d)           The
following terms and conditions shall apply if the employment of the Executive
with the Company is terminated: by the Company for Cause; or by the Employee for
any reason other than for Good Reason:

    


    (i)           The
Company shall pay to the Executive the compensation due and owing to the
Executive as of the termination date.

    


    (e)           The
following terms and conditions shall apply if the employment of the Executive
with the Company is terminated: by the Company giving notice of non-renewal of
the Term as provided on Exhibit
A:

    


    (i)           The
Company shall continue to pay to the Executive the compensation due and owing to
the Executive for the balance of the Term then ending, including but not limited
to salary and scheduled bonuses; and

    


    (ii)          For
one (1) year from and after the termination date, the Company shall continue
providing to the Executive the health and medical benefits described as such on
Exhibit
A.

    


    (f)           The
following terms and conditions shall apply if the employment of the Executive
with the Company is terminated: by the Executive giving notice of non-renewal of
the Term as provided on Exhibit
A:

    


    (i)           The
Company shall continue to pay to the Executive the compensation due and owing to
the Executive for the balance of the Term then ending, including but not limited
to salary and scheduled bonuses.

    


    8.           CONFIDENTIAL
INFORMATION

    


    (a)           The
Executive covenants and agrees that he will not at any time during the
continuance of this Agreement or at any time thereafter: (i) print,
publish, divulge or communicate to any person, firm, corporation or other
business organization (except in connection with the Executive's employment
hereunder) or use for his own account any secret or confidential information
relating to the business of the Company that the Company has taken all
commercially reasonable steps to protect and keep confidential (including,
without limitation, information relating to any customers, suppliers, employees,
products, services, formulae, technology, know-how, trade secrets or the like,
financial information or plans) or any secret or confidential information
relating to the affairs, dealings, projects and concerns of the Company, both
past and planned that the Company has taken all commercially reasonable steps to
protect and keep confidential (the "Confidential Information"), which the
Executive has received or obtained or may receive or obtain as a result of his
employment with the Company (whether or not developed, devised or otherwise
created in whole or in part by the efforts of the Executive); or (ii) take
with him, upon termination of his employment hereunder, any information in paper
or document form or on any computer-readable media relating to the
foregoing.  The term "Confidential Information" does not include
information which is or becomes generally available to the public other than as
a result of disclosure by the Executive or which is generally known in the video
game products business.  The Executive further covenants and agrees
that he shall retain the Confidential Information received or obtained as a
result of such service in trust for the sole benefit of the Company or its
successors and assigns.


    
      
         


      

      
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    (b)           The
term Confidential Information as defined in Section 8(a) hereof shall include
information obtained by the Company from any third party under an agreement
including restrictions on disclosure known to the Executive.

    


    (c)           In
the event that the Executive is requested pursuant to subpoena or other legal
process to disclose any of the Confidential Information, the Executive will
provide the Company with prompt notice so that the Company may seek a protective
order or other appropriate remedy and/or waive compliance with Section 8 of this
Agreement.  In the event that such protective order or other remedy is
not obtained or that the Company waives compliance with the provisions of
Section 8 of this Agreement, the Executive will furnish only that portion of the
Confidential Information which is legally required.

    


    9.           RESTRICTIONS DURING
EMPLOYMENT AND FOLLOWING TERMINATION

    


    The
provisions described in Sections 9(a), 9(b) and 9(c) below shall be referred to
hereinafter, collectively, as the “Restrictive Covenants.”

    


    (a)           The
Executive shall not, anywhere within the United States, during the Term and for
a period of one (1) year thereafter, without the prior written consent of the
Company, directly or indirectly, and whether as principal, agent, officer,
director, partner, employee, consultant, broker, dealer or otherwise, alone or
in association with any other person, firm, corporation or other business
organization, carry on, or be engaged, have an interest in or take part in, or
render services to any person, firm, corporation or other business organization
(other than the Company) engaged in a business which is competitive with all or
part of the Business of the Company.  The term "Business of the
Company" shall mean buying, repairing and selling pre-owned video game products
at retail or wholesale anywhere in the United States of America.

    


    (b)           The
Executive shall not, for a period of one (1) year after termination of his
employment hereunder, either on his own behalf or on behalf of any other person,
firm, corporation or other business organization, endeavor to entice away from
the Company any person who, at any time during the continuance of this
Agreement, was an employee of the Company.


    
      
         


      

      
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    (c)           The
Executive shall not, for a period of one (1) year after termination of his
employment hereunder, either on his own behalf or on behalf of any other person,
firm, corporation or other business organization, solicit or direct others to
solicit, any of the Company's customers or prospective customers (identified in
writing by the Company as prospective customers) that were Company customers or
respective customers during the Executive’s employment (including, but not
limited to, those customers or prospective customers with whom the Executive
contacted for business purposes during his term of employment) for any purpose
or for any activity which is competitive with all or part of the Business of the
Company.

    


    (d)           It
is understood by and between the parties hereto that the foregoing covenants by
the Executive set forth in this Section 9 are essential elements of this
Agreement and that, but for the agreement of the Executive to comply with such
covenants, the Company would not have entered into this Agreement.  It
is recognized by the Executive that the Company currently operates in, and may
continue to expand its operations throughout, the geographical territories
referred to in Section 9(a) above. The Company and the Executive have
independently consulted with their respective counsel and have been advised in
all respects concerning the reasonableness and propriety of such
covenants.

    


    10.           REMEDIES

    


    (a)           Without
intending to limit the remedies available to the Company, it is mutually
understood and agreed that the Executive's services are of a special, unique,
unusual, extraordinary and intellectual character giving them a peculiar value,
the loss of which may not be reasonably or adequately compensated in damages in
an action at law, and, therefore, in the event of any material breach by the
Executive that continues after any applicable cure period, the Company shall be
entitled to equitable relief by way of injunction or otherwise.

    


    (b)             In
the event that any of the provisions of Sections 8 or 9 hereof should ever be
adjudicated to exceed the time, geographic, product/service or other limitations
permitted by applicable law in any jurisdiction, then such provisions shall be
deemed reformed in any such jurisdiction to the maximum time, geographic,
product/service or other limitations permitted by applicable law.

    


    11.           COMPLIANCE WITH OTHER
AGREEMENTS

    


    The
Executive represents and warrants to the Company that the execution of this
Agreement by him and his performance of his obligations hereunder will not, with
or without the giving of notice or the passage of time or both, conflict with,
result in the breach of any provision of or the termination of, or constitute a
default under, any agreement to which the Executive is a party or by which the
Executive is or may be bound.

    


    12.           WAIVERS

    


    The
waiver by the Company or the Executive of a breach of any of the provisions of
this Agreement shall not operate or be construed as a waiver of any subsequent
breach.


    
      
         


      

      
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    13.           BINDING EFFECT;
BENEFITS

    


    This
Agreement shall inure to the benefit of, and shall be binding upon, the parties
hereto and their respective successors, assigns, heirs and legal
representatives, including any corporation or other business organization with
which the Company may merge or consolidate or sell all or substantially all of
its assets, except as otherwise provided herein with respect to the Restrictive
Covenants.  Insofar as the Executive is concerned, this contract,
being personal, cannot be assigned.

    


    14.           NOTICES

    


    All
notices and other communications which are required or may be given under this
Agreement shall be in writing and shall be deemed to have been duly given when
delivered to the person to whom such notice is to be given at his or its address
et forth below, or such other address for the party as shall be specified by
notice given pursuant hereto:

     

    
      	
               
      

            	
              (a)

            	
              If
      to the Executive, to him at the address set forth in Exhibit
      A.

            


    

     

    and with
a courtesy copy to:

     

    Bowie
& Jensen, LLC

    29 West
Susquehanna Avenue, 6th
Floor

    Towson,
Maryland 21204

    Attention:
Mark T. Jensen, Esq.

     

    
      	
            	
              (b)

            	
              If
      to the Company, to it at:

            


    

     

    Game
Trading Technologies, Inc.

    10957
McCormick Road

    Hunt
Valley, Maryland 21031

    Attention:
Mr. Todd Hays, President and Chief Executive Officer

     

    15.           MISCELLANEOUS

    


    (a)           This
Agreement contains the entire agreement between the parties hereto and
supersedes all prior agreements and understandings, oral or written, between the
parties hereto with respect to the subject matter hereof.  This
Agreement may not be changed, modified, extended or terminated except upon
written amendment approved by the Board and executed by a duly authorized
officer of the Company.

    


    (b)           The
Executive acknowledges that from time to time, the Company may establish,
maintain and distribute employee manuals of handbooks or personnel policy
manuals, and officers or other representatives of the Company may make written
or oral statements relating to personnel policies and
procedures.  Such manuals, handbooks and statements are intended only
for general guidance.  No policies, procedures or statements of any
nature by or on behalf of the Company (whether written or oral, and whether or
not contained in any employee manual or handbook or personnel policy manual),
and no acts or practices of any nature, shall be construed to modify this
Agreement or to create express or implied obligations of any nature to the
Executive.


    
      
         


      

      
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    (c)           This
Agreement may be executed in counterparts, each of which shall be deemed to be
an original, but all of which together shall constitute one and the same
instrument.

    


    (d)           All
questions pertaining to the validity, construction, execution and performance of
this Agreement shall be governed by and construed in accordance with the laws of
the State of Maryland, without regard to its conflict of law
principles.

    


    (e)           The
parties irrevocably and unconditionally submit to the exclusive jurisdiction of
the federal and state courts sitting in Maryland over any suit, action or
proceeding arising out of or relating to this Agreement. The parties irrevocably
and unconditionally waive any objection to the laying of venue of any such suit,
action or proceeding brought in such court and any claim that any such suit,
action or proceeding brought in such court has been brought in an inconvenient
forum. The parties agree that a final judgment in any such suit, action or
proceeding brought in such court shall be conclusive and binding upon the
parties and may be enforced in any other courts to whose jurisdiction other
parties are or may be subject, by suit upon such judgment.

    


    The
parties indicate their acceptance of the foregoing arbitration requirement by
initialing below:

    
      


      
        
          
            
              	
                      /s/
      Todd Hays

                    	 
      	
                      /s/
      Rodney Hillman

                    
	
                      For
      the Company

                    	 
      	
                      Executive

                    


            

          

        

      

      


      IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day
and year first above written.

      


      
        
          
            
              
                
                  	
                          GAME
      TRADING TECHNOLOGIES, INC.

                        
	 
	
                          By: 

                        	
                          /s/ Todd Hays, CEO

                        
	 	 
	
                          EXECUTIVE

                        
	 
	
                          /s/ Rodney Hillman

                        
	
                           Name:
      Rodney
Hillman

                        


                

              

            

          

        

      


      
        
           


        

        
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      EXHIBIT A
TO THE EMPLOYMENT AGREEMENT,

      DATED AS
OF FEBRUARY 25, 2010, BETWEEN

      GAME TRADING TECHNOLOGIES,
INC. AND RODNEY HILLMAN

       

      A.           For
Introductory Paragraph:    The Executive is Rodney
Hillman.

       

      B.           For Section
1:

       

      Subject
to any renewal as hereafter provided, the date referred to in Section 1 shall be
the later to occur of: (i) three years from and after the date hereof; or (ii)
the last day of the last fiscal year for which the Executive could have achieved
the release of Escrowed Shares (as hereinafter defined) pursuant to meeting
certain EBITDA targets pursuant to that certain Performance Milestone Shares
Escrow Agreement, dated as of February __, 2010, by and among Game Trading
Technologies, Inc., Vision Opportunity Master Fund, Ltd. and/or Vision
Opportunity Partners II, L.P. on behalf of the Buyers identified in the
Securities Purchase Agreement, Greenberg Traurig, LLP, as escrow agent (the
“Escrow
Agent”), and Todd Hays, Rodney Hillman, John Hays, Jr. and Thomas Hays
(“Escrow Agreement”).

       

      The term
“Term” shall also include any renewals of the term described above in this
Section B, which renewals shall be automatic for one (1) year each unless either
party gives written notice of non-renewal to the other party before sixty (60)
days prior to the date the initial term or any renewal term would otherwise
expire. For purposes of this Agreement, unless specifically defined in this
Agreement, all the defined terms referred to this Section B of Exhibit A shall
have the meanings as defined in the Escrow Agreement.

       

      C.           For Section
2:

       

      The
position of the Executive referred to in Section 2 shall be Chief Operating
Officer.

       

      
        	
                D.

              	
                For Section
      3(a):

              


      

       

      The
annual rate referred to in Section 3(a) shall be One Hundred and Twenty-Five
Thousand Dollars and 00/100 ($125,000.00).

       

      E.           For Section
3(b):

       

      In
addition to the compensation referred to in Section 3(a), the Company shall also
pay to the Executive, in respect of each fiscal year, a cash bonus in an amount
to be determined by the Board of up to 15% of his annual base salary based on
the Executive meeting and exceeding mutually agreed upon performance goals for
the Company or a division of the Company.

       

      F.           For
Section 4:

       

      The Executive shall receive the
following fringe benefits, as such benefits may be adjusted by the Company for
all its senior executives from time to time: group insurance (health, dental,
life), paid sick leave, paid vacation, and other future benefits introduced by
board approval (e.g. 401K or other retirement plan).


      
        
           


        

        
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      G.           For Section
5:

       

      The
length of vacation referred to in Section 5 shall be four (4)
weeks.

       

      
        	
                H.

              	
                For Section
      14:

              


      

       

      The
address of the Executive referred to in Section 14 shall be:

       

      3201
Glouchester Drive, Fallston, MD  21047


      
        
           


        

        
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      EXHIBIT B
TO THE EMPLOYMENT AGREEMENT,

      DATED AS
OF FEBRUARY 25, 2010, BETWEEN

      GAME
TRADING TECHNOLOGIES, INC. AND RODNEY HILLMAN

      


      The Executive shall be permitted to
continue ownership and management of the following business during the term of
this Agreement without such ownership and management constituting any breach of
this Agreement:

      


      None.


      
        
           


        

        
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