Exhibit 10.1


 


EMPLOYMENT
AGREEMENT

(Michael Owens)


 


THIS EMPLOYMENT AGREEMENT
(this “Agreement”) is entered into as of January 9, 2009 (the “Effective
Date”) by and between Gander Mountain Company, a Minnesota corporation (the “Company”),
and Michael Owens, a resident of Missouri (“Executive”).


 


RECITALS


 


A.                                   The Company engages in the business of
the retail sale and distribution of hunting, fishing, camping, boating, marine
and other outdoor recreational and athletic goods, clothing, equipment, and
supplies.


 


B.                                     The
Company desires to employ Executive, and Executive wishes to be employed, as
Executive Vice President and Chief Operating Officer of the Company, on the
terms and conditions set forth in this Agreement.


 


AGREEMENT


 


NOW,
THEREFORE, in consideration of the foregoing premises and the respective
agreements of the Company and Executive set forth below, the Company and
Executive, intending to be legally bound, agree as follows:


 


1.                                       Employment.  Subject to all the terms and conditions of
this Agreement, Executive’s period of employment under this Agreement shall be
the period commencing on the Effective Date and ending on the second
anniversary of the Effective Date (the “Initial Term”), unless the Executive’s
employment terminates earlier in accordance with Section 8 hereof.
Thereafter, unless earlier terminated in accordance with Section 8 hereof,
the term of Executive’s employment with the Company shall be automatically
extended for successive one-year periods following the expiration of the
Initial Term (each, a “Renewal Term” and, together with the Initial Term, the “Term”),
unless either party gives written notice to the other party at least 90 days
prior to the expiration of the Initial Term or any Renewal Term that such party
elects not to extend the term of Executive’s employment.


 


2.                                       Position
and Duties; No Violations.


 


(a)                                  Employment
with the Company.  While Executive is
employed by the Company during the Term, Executive shall be employed as
Executive Vice President and Chief Operating Officer of the Company, or with
such other title as the Company may designate, and shall perform such duties
and responsibilities as the Company shall assign to Executive from time to
time.


 


(b)                                 Performance
of Duties and Responsibilities. 
Executive shall serve the Company faithfully and to the best of
Executive’s ability and shall devote Executive’s full working time, attention
and efforts to the business of the Company during Executive’s employment with
the Company hereunder.  Executive shall
report to the Company’s Chief


 

















 


Executive Officer or to
such other person as designated by the Company. 
Executive hereby represents and confirms that Executive is under no
contractual or legal commitments that would prevent Executive from fulfilling
Executive’s duties and responsibilities as set forth in this Agreement.  During Executive’s employment with the
Company, Executive shall not accept other employment or engage in other
material business activity, except as approved in writing by the Board of
Directors of the Company (the “Board”). 
Executive may participate (including as a director) in charitable
activities and personal investment activities to a reasonable extent so long as
such activities do not interfere with the performance of Executive’s duties and
responsibilities hereunder.  Executive
may serve as a director of for profit business organizations only as approved
by the Board.


 


(c)                                  No
Violation of Other Agreements. 
Executive hereby represents and agrees that neither (i) Executive’s
entering into this Agreement, (ii) Executive’s employment with the
Company, nor (iii) Executive’s carrying out the provisions of this
Agreement, will violate any other agreement (oral, written or other) to which
Executive is a party or by which Executive is bound.


 


3.                                       Compensation.


 


(a)                                  Base
Salary.  While Executive is employed
by the Company during the Term, the Company shall pay to Executive a base
salary at the rate of Five Hundred Thousand Dollars ($500,000.00) per year,
less deductions and withholdings, which base salary shall be paid in accordance
with the Company’s normal payroll policies and procedures.  On or before April 1 of each year during
the Term, commencing in fiscal year 2010, the Compensation Committee of the
Board (the “Compensation Committee”) shall review Executive’s performance and
may increase (but not reduce) Executive’s base salary in its sole discretion;
provided, however, that the Compensation Committee may reduce Executive’s base
salary by no more than 10% in any twelve-month period if such reduction is part
of a general reduction in the base salaries of all executives of the Company
and; provided further, that no such reduction shall reduce Executive’s base
salary below the initial base salary set forth in the first sentence of this Section 3(a).


 


(b)                                 Annual
Incentive Bonus.  Commencing with
fiscal year 2009 and for each full fiscal year thereafter that Executive is
employed by the Company during the Term, Executive shall be eligible for an
annual cash incentive bonus in an amount up to 100% of the annual base salary
paid to Executive for such fiscal year, based upon achievement of defined goals
mutually agreed upon by Executive and the Compensation Committee and in
accordance with the terms of any incentive plan of the Company in effect from
time to time (the “Annual Incentive Bonus”). 
The level of achievement of the objectives each year and the amount
payable as Annual Incentive Bonus shall be determined in good faith by the
Compensation Committee.  Any Annual
Incentive Bonus earned in a fiscal year shall be paid to Executive on or before
the sixtieth (60th) day
following the last day of such fiscal year.


 


(c)                                  Equity-Based
Awards; Accelerated Vesting and Period to Exercise.  From time to time, Executive shall be
eligible for awards under the Amended and Restated 2004 Omnibus Stock Plan (the
“Plan”), and the Compensation Committee, in its sole discretion, may


 


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grant Executive an award under the Plan in accordance
with the terms and conditions of the Plan or any successor plan, as may be
amended from time to time.  Upon the occurrence of a Change in Control
(as defined in Section 9 hereof) while Executive is employed by the
Company, the vesting of all stock options, grants of restricted stock and other
equity-based awards (collectively, the “Equity Awards”) subject to time or
performance based vesting then held by Executive shall be accelerated and all
such Equity Awards shall become immediately fully vested upon such Change in
Control.  Upon the occurrence of the
termination of Executive’s employment by the Company without Cause (as defined
in Section 9 hereof), the vesting of all Equity Awards subject to time
based vesting then held by Executive that would otherwise vest on or before the
first anniversary of the Termination Date (as defined in Section 8 hereof)
shall be accelerated and such Equity Awards shall become immediately vested to
such extent upon such termination without Cause.  Notwithstanding any shorter period specified
in the applicable award agreement or plan, if Executive is entitled to a
Severance Amount (as defined in Section 8 hereof), then all vested Equity
Awards held by Executive on Executive’s Termination Date (including all Equity Awards for which vesting
accelerates pursuant to this Section 3(c)) shall remain exercisable
through the date that Executive receives the last payment of the Severance
Amount.


 


(d)                                 Benefits.  While Executive is employed by the Company
during the Term, Executive shall be entitled to participate in all employee
benefit plans and programs of the Company to the extent that Executive meets
the eligibility requirements for each individual plan or program.  The Company provides no assurance as to the
adoption or continuance of any particular employee benefit plan or program, and
Executive’s participation in any such plan or program shall be subject to the
provisions, rules and regulations applicable thereto.


 


(e)                                  Expenses.  While Executive is employed by the Company
during the Term, the Company shall reimburse Executive for all reasonable and
necessary out-of-pocket business, travel and entertainment expenses incurred by
Executive in the performance of Executive’s duties and responsibilities
hereunder, subject to the Company’s normal policies and procedures for expense
verification and documentation.  While
Executive is employed by the Company, Executive shall be permitted to maintain
his primary residence in the St. Louis Missouri metropolitan area (“St. Louis”)
or the Minneapolis-St. Paul, Minnesota metropolitan area (“St. Paul”).  So long as Executive maintains his residence
in St. Louis, the Company shall reimburse Executive for weekly roundtrip
commercial airline transportation between St. Louis and St. Paul and shall
provide Executive with housing in St. Paul at a corporate apartment leased by
the Company.  In addition, the Company
shall provide Executive with use of a leased or rented automobile in St. Paul
reasonably acceptable to the Company and Executive.  The Company shall also reimburse Executive
for any taxes associated with the benefits described in the preceding two
sentences and for any additional taxes associated with the initial tax
reimbursement, together in an amount such that after payment by Executive of
all associated taxes, Executive retains a tax reimbursement (the “Gross Up
Payment”) equal to the associated taxes. 
Each such Gross Up Payment shall be made no later than the end of the
calendar year following the calendar year in which Executive remits the related
taxes.


 


4.                                       Affiliated
Entities.  As used in Sections 5, 6
and 7 of this Agreement, “Company” shall include the Company and each
corporation, partnership, or other entity that is controlled by 


 


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the Company, or is under
common control with the Company (in each case “control” meaning the direct or
indirect ownership of 50% or more of all outstanding equity interests).


 


5.                                       Confidential
Information.  Except as required in
the performance of Executive’s duties as an employee of the Company or as
authorized in writing by the Board, Executive shall not, either during
Executive’s employment with the Company or at any time thereafter, use,
disclose or make accessible to any person any confidential information for any
purpose.  “Confidential Information”
means information proprietary to the Company or its customers or prospective
customers and not generally known (including trade secret information) about
the Company’s customers, products, services, personnel, suppliers, pricing,
sales strategies, technology, computer software code, methods, processes,
designs, research, development systems, techniques, finances, accounting,
purchasing, and plans.  All information
disclosed to Executive or to which Executive obtains access, whether originated
by Executive or by others, during the period of Executive’s employment by the
Company, shall be presumed to be Confidential Information if it is treated by
the Company as being Confidential Information or if Executive has a reasonable
basis to believe it to be Confidential Information.  Executive acknowledges that the
above-described knowledge and information constitutes a unique and valuable
asset of the Company and represents a substantial investment of time and
expense by the Company, and that any disclosure or other use of such knowledge
or information other than for the sole benefit of the Company would be wrongful
and would cause irreparable harm to the Company.  During Executive’s employment with the
Company, Executive shall refrain from committing any acts that would materially
reduce the value of such knowledge or information to the Company.  The foregoing obligations of confidentiality
shall not apply to any knowledge or information that (i) is now or
subsequently becomes generally publicly known, other than as a direct or
indirect result of the breach of this Agreement by Executive, (ii) is
independently made available to Executive in good faith by a third party who
has not violated a confidential relationship with the Company, or (iii) is
required to be disclosed by law or legal process.  Notwithstanding the previous sentence, prior
to disclosure of Confidential Information pursuant to clause (iii) thereof,
Executive shall give the Company prompt notice of the legal requirement for
disclosure so that the Company may seek an appropriate protective order and at
the Company’s request and expense, Executive shall cooperate with the Company
in seeking such an order.  If Executive
is nonetheless compelled to disclose Confidential Information as permitted by
such clause (iii), Executive shall disclose only that portion of the
Confidential Information as Executive is legally compelled to disclose and, at
the Company’s request and expense, shall use commercially reasonable efforts to
obtain assurances that confidential treatment will be accorded such
Confidential Information.  Executive
acknowledges that the obligations imposed by this Section 5 are in
addition to, and not in place of, any obligations imposed by applicable
statutory or common law.


 


6.                                       Noncompetition
Covenant.


 


(a)                                  Agreement
Not to Compete.  During Executive’s
employment with the Company and during the Restricted Period (as defined
below), Executive shall not, directly or indirectly, on Executive’s own behalf
or on behalf of any person or entity other than the Company, including without
limitation as a proprietor, principal, agent, partner, officer, director,
stockholder, employee, member of any association, consultant or otherwise,
engage in any 


 


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business that is then
competitive with the business of the Company, including without limitation any
business that operates retail stores for the sale or distribution of hunting,
fishing, camping or other outdoor recreational and athletic goods, clothing,
equipment or supplies (such as Cabela’s Inc., Bass Pro Shops and Sportsman’s
Warehouse).  Ownership by Executive, as a
passive investment, of less than 0.5% of the outstanding shares of capital
stock of any corporation listed on a national securities exchange or publicly
traded in the over-the-counter market shall not constitute a breach of this Section 6(a) or
any other provisions of this Section 6.


 


(b)                                 Agreement
Not to Hire.  Except as required in
the performance of Executive’s duties as an employee of the Company, during
Executive’s employment with the Company and during the Restricted Period,
Executive shall not, directly or indirectly, hire, engage or solicit or induce
or attempt to induce to cease working for the Company, any person who is then
an employee of the Company or who was an employee of the Company during the six
(6) month period immediately preceding Executive’s termination of
employment with the Company.


 


(c)                                  Agreement
Not to Solicit.  Except as required
in the performance of Executive’s duties as an employee of the Company, during
Executive’s employment with the Company and during the Restricted Period,
Executive shall not, directly or indirectly, solicit, request, advise, induce
or attempt to induce any vendor, supplier or other business contact of the Company
to cancel, curtail, cease doing business with, or otherwise adversely change
its relationship with the Company.


 


(d)                                 Restricted
Period.  “Restricted Period”
hereunder means a period of twelve consecutive months immediately following the
last day of Executive’s employment with the Company.


 


(e)                                  Acknowledgment.  Executive hereby acknowledges that the
provisions of this Section 6 are reasonable and necessary to protect the
legitimate interests of the Company and that any violation of this Section 6
by Executive shall cause substantial and irreparable harm to the Company to
such an extent that monetary damages alone would be an inadequate remedy
therefor.  Therefore, in the event that
Executive violates any provision of this Section 6, the Company shall be entitled
to an injunction, in addition to all the other remedies it may have,
restraining Executive from violating or continuing to violate such provision.


 


(f)                                    Blue
Pencil Doctrine.  If the duration of,
the scope of or any business activity covered by any provision of this Section 6
is in excess of what is determined to be valid and enforceable under applicable
law, such provision shall be construed to cover only that duration, scope or
activity that is determined to be valid and enforceable.  Executive hereby acknowledges that this Section 6
shall be given the construction that renders its provisions valid and
enforceable to the maximum extent, not exceeding its express terms, possible
under applicable law.


 


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7.                                       Intellectual
Property.


 


(a)                                  Disclosure
and Assignment.  As of the Effective
Date, Executive hereby transfers and assigns to the Company (or its designee)
all right, title, and interest of Executive in and to every idea, concept,
invention, and improvement (whether patented, patentable or not) conceived or
reduced to practice by Executive whether solely or in collaboration with others
while Executive is employed by the Company, and all copyrighted or
copyrightable matter created by Executive whether solely or in collaboration
with others while Executive is employed by the Company, in each case, that
relates to the Company’s  business
(collectively, “Creations”).  Executive
shall communicate promptly and disclose to the Company, in such form as the
Company may request, all information, details, and data pertaining to each
Creation.  Every copyrightable Creation,
regardless of whether copyright protection is sought or preserved by the
Company, shall be a “work made for hire” as defined in 17 U.S.C.
§ 101, and the Company shall own all rights in and to such matter
throughout the world, without the payment of any royalty or other consideration
to Executive or anyone claiming through Executive.


 


(b)                                 Trademarks.  All right, title, and interest in and to any
and all trademarks, trade names, service marks, and logos adopted, used, or
considered for use by the Company during Executive’s employment (whether or not
developed by Executive) to identify the Company’s business or other goods or
services (collectively, the “Marks”), together with the goodwill appurtenant
thereto, and all other materials, ideas, or other property conceived, created,
developed, adopted, or improved by Executive solely or jointly during Executive’s
employment by the Company and relating to its business shall be owned
exclusively by the Company.  Executive
shall not have, and will not claim to have, any right, title, or interest of
any kind in or to the Marks or such other property.


 


(c)                                  Documentation.  Executive shall execute and deliver to the Company
such formal transfers and assignments and such other documents as the Company
may request to permit the Company (or its designee) to file and prosecute such
registration applications and other documents it deems useful to protect or
enforce its rights hereunder.  Any idea,
invention, copyrightable matter, or other property relating to the Company’s
business and disclosed by Executive prior to the first anniversary of the
effective date of Executive’s
termination of employment shall be deemed to be governed by the terms of this Section 7
unless proven by Executive to have been first conceived and made after such
termination date.


 


(d)                                 Non-Applicability. 
Executive is hereby notified that this Section 7 does not apply to
any invention for which no equipment, supplies, facility, Confidential
Information, or other trade secret information of the Company was used and
which was developed entirely on Executive’s own time, unless (1) the
invention relates (a) directly to the business of the Company or (b) to
the Company’s actual or demonstrably anticipated research or development, or (2) the
invention results from any work performed by Executive for the Company.


 


8.                                       Termination of Employment.


 


(a)                                  Executive’s employment with the Company shall
terminate immediately upon:


 


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(i)            The effective date of termination of
Executive’s employment specified in a written notice of termination received by
Executive from the Company;


 


(ii)           the Company’s
receipt of Executive’s written resignation from the Company;


 


(iii)          Executive’s Disability (as defined below); or


 


(iv)          Executive’s
death.


 


(b)                                 The date upon which Executive’s termination
of employment with the Company occurs shall be the “Termination Date.”


 


9.                                       Payments upon Termination of Employment.


 


(a)                                  If Executive’s employment with the Company is
terminated by reason of:


 


(i)            Executive’s abandonment of Executive’s
employment or Executive’s resignation for any reason;


 


(ii)           termination of Executive’s employment by the
Company for Cause (as defined below); or


 


(iii)          expiration of the Term; following notice by
the Executive of non-renewal, pursuant to Section  1 above,


 


the
Company shall pay to Executive the Executive’s then-current base salary through
the Termination Date and any Annual Incentive Bonus earned but unpaid for the
completed fiscal year preceding the fiscal year in which the Termination Date
occurs; provided that such Annual Incentive Bonus payments shall be payable in
the same manner and at the same time that Annual Incentive Bonus payments are
made to current employees of the Company.


 


(b)                                 If Executive’s employment with the Company is
involuntarily terminated by the Company for any reason other than for Cause (as
defined below), including without limitation the expiration of the Term
following notice by the Company of non-renewal pursuant to Section 1
above, then the Company shall, subject to Sections 9(j) and 9(k) of
this Agreement and in addition to any base salary earned through the
Termination Date and any Annual Incentive Bonus earned but unpaid for the
completed fiscal year preceding the fiscal year in which the Termination Date
occurs, pay to Executive:


 


(i)            an amount equal to Executive’s then-current
annual base salary; and


 


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(ii)           an amount equal to the Annual Incentive Bonus
that Executive earned under Section 3(b) for the last full fiscal
year of Executive’s employment with the Company.


 


(c)                                  If Executive’s employment with the Company
terminates by reason of Executive’s death or Disability, the Company shall pay
to Executive or Executive’s beneficiary or Executive’s estate, as the case may
be, Executive’s then-current base salary through the Termination Date, any
earned and unpaid Annual Incentive Bonus for the fiscal year preceding the
fiscal year in which the Termination Date occurs and a pro-rated portion of any
Annual Incentive Bonus for the fiscal year in which the Termination Date
occurs, based on the number of days during such fiscal year Executive was employed
by the Company, payable in the same manner and at the same time that Annual
Incentive Bonus payments are made to current employees of the Company.


 


(d)                                 Notwithstanding the provisions of Sections 9(a) and
9(b), if, within twelve months following
the occurrence of a Change in Control (as defined below), Executive’s
employment with the Company is terminated by either Executive or the Company
for any reason, then the Company shall, subject to Sections 9(j) and 9(k) of
this Agreement and in addition to any base salary earned through the
Termination Date and any Annual Incentive Bonus earned but unpaid for the
preceding fiscal year, and in lieu of any
payments required by Sections 9(a) or 9(b) of this Agreement, pay to
Executive:


 


(i)            an amount equal to Executive’s then-current
annual base salary; and


 


(ii)           an amount equal to the Annual Incentive Bonus
that Executive earned under Section 3(b) for the last full fiscal
year of Executive’s employment with the Company.


 


In
the event that Executive becomes eligible for payments under this Section 9(d),
the Company shall be released from its obligation to make any payments pursuant
to Sections 9(a) or 9(b) above.


 


(e)                                  Any amount
payable to Executive pursuant to Section 9(b)(i) and 9(b)(ii) or
pursuant to Section 9(d)(i) and 9(d)(ii), as applicable (the “Severance
Amount”), shall be subject to deductions and withholdings for applicable taxes
but shall not be subject to deductions for any other amounts received by
Executive as a result of future employment or otherwise.  Fifty percent (50%) of the Severance Amount
shall be paid to Executive by the Company in a lump sum on the first day of the
seventh month after the Termination Date. 
The remaining balance of the Severance Amount shall be paid to Executive
by the Company in equal installments pursuant to the Company’s regular payroll
practices and procedures (with each payment constituting a separate payment for
purposes of Internal Revenue Code Section 409A), commencing on the first
normal payroll date of the Company following the date of payment of the first
lump sum payment and continuing for six months thereafter.


 


(f)                                    Cause. 
“Cause” hereunder shall mean:


 


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(i)                                     an act or acts of dishonesty undertaken by
Executive and intended to result in substantial gain or personal enrichment of
Executive at the expense of the Company;


 


(ii)                                  unlawful conduct or gross misconduct that is
willful and deliberate on Executive’s part and that, in either event, is
materially injurious to the Company;


 


(iii)                               the conviction of Executive of a felony;


 


(iv)                              material and deliberate failure of Executive to perform Executive’s
duties and responsibilities hereunder or to satisfy Executive’s obligations as
an officer or employee of the Company, which failure has not been cured by
Executive within 15 days after written notice thereof to Executive from the
Company; or


 


(v)                                 material breach of any terms and conditions
of this Agreement by Executive not caused by the Company, which breach has not
been cured by Executive within 15 days after written notice thereof to
Executive from the Company.


 


(g)                                 A “Change in Control” of the Company shall be
deemed to occur if any of the following occur:


 


(i)            Any “person” (as such term is used in
Sections 13(d) and 14(d) of the Securities Exchange Act
of 1934, as amended (the “Exchange Act”)) after the date of this Agreement
first acquires or becomes a “beneficial owner” (as defined in Rule 13d-3
or any successor rule under the Exchange Act), directly or indirectly, of
securities of the Company representing 30% or more of the combined voting power
of the Company’s then outstanding securities entitled to vote generally in the
election of directors (“Voting Securities”), provided, however, that the
following shall not constitute a Change in Control pursuant to this Section 9:


 


(A)          any
acquisition of Shares or Voting Securities of the Company directly from the
Company;


 


(B)           any
acquisition or beneficial ownership by the Company or a subsidiary;


 


(C)           any
acquisition or beneficial ownership by any employee benefit plan (or related
trust) sponsored or maintained by the Company or one or more of its
subsidiaries;


 


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(D)          any
acquisition or beneficial ownership by any corporation with respect to which,
immediately following such acquisition, more than 50% of both the combined
voting power of the Company’s then outstanding Voting Securities and the Shares
of the Company is then beneficially owned by all or substantially all of the
persons who beneficially owned Voting Securities and Shares of the Company
immediately prior to such acquisition in substantially the same proportions as
their ownership of such Voting Securities and Shares, as the case may be,
immediately prior to such acquisition;


 


(ii)           A
majority of the members of the Board of Directors of the Company shall not be
Continuing Directors.  “Continuing
Directors” shall mean:  (A) individuals
who, on the date hereof, are directors of the Company, (B) individuals
elected as directors of the Company subsequent to the date hereof for whose
election proxies shall have been solicited by the Board of Directors of the
Company, (C) individuals elected as directors of the Company subsequent to
the date hereof pursuant to a nomination or board representation right of
preferred stockholders of the Company or (D) any individual elected or
appointed by the Board of Directors of the Company to fill vacancies on the
Board of Directors of the Company caused by death or resignation (but not by
removal) or to fill newly-created directorships;


 


(iii)          Consummation
of a reorganization, merger or consolidation of the Company or a statutory
exchange of outstanding Voting Securities of the Company, unless, immediately
following such reorganization, merger, consolidation or exchange, all or
substantially all of the persons who were the beneficial owners, respectively,
of Voting Securities and Shares of the Company immediately prior to such
reorganization, merger, consolidation or exchange beneficially own, directly or
indirectly, more than 50% of, respectively, the combined voting power of the
then outstanding voting securities entitled to vote generally in the election
of directors and the then outstanding shares of common stock, as the case may
be, of the corporation that is the issuer of such securities held by the
stockholders of the Company after such reorganization, merger, consolidation or
exchange in substantially the same proportions as their ownership, immediately
prior to such reorganization, merger, consolidation or exchange, of the Voting
Securities and Shares of the Company, as the case may be; or


 


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(iv)          Consummation of (A) a complete
liquidation or dissolution of the Company or (B) the sale or other
disposition of all or substantially all of the assets of the Company (in one or
a series of transactions), other than to a corporation with respect to which,
immediately following such sale or other disposition, more than 50% of,
respectively, the combined voting power of the then outstanding voting
securities of such corporation entitled to vote generally in the election of
directors and the then outstanding shares of common stock of such corporation
is then beneficially owned, directly or indirectly, by all or substantially all
of the persons who were the beneficial owners, respectively, of the Voting
Securities and Shares of the Company immediately prior to such sale or other
disposition in substantially the same proportions as their ownership,
immediately prior to such sale or other disposition, of the Voting Securities
and Shares of the Company, as the case may be.


 


(h)                                 “Disability” hereunder shall mean the
inability of Executive to perform on a full-time basis the duties and
responsibilities of Executive’s employment with the Company by reason of
Executive’s illness or other physical or mental impairment or condition, if
such inability continues for an uninterrupted period of 90 days or more during
any 360-day period.  A period of
inability shall be “uninterrupted” unless and until Executive returns to
full-time work for a continuous period of at least 30 days.


 


(i)                                     In the event of termination of Executive’s
employment, the sole obligation of the Company to make payments to Executive
shall be its obligation to make the payments called for by Sections 9(a),
9(b), 9(c), or 9(d) hereof, as the case may be, and the Company shall have
no other obligation to make payments to Executive or to Executive’s beneficiary
or Executive’s estate, except as otherwise provided by law.


 


(j)                                     Notwithstanding any other provision
hereof, the Company shall not be obligated to make any payments under Section 9(b) or
9(d) of this Agreement unless Executive has signed a full release of
claims against the Company, in a form and scope to be prescribed by the Board
in its reasonable discretion, substantially in the form of Exhibit A
hereto, all applicable consideration periods and rescission periods provided by
law shall have expired, and Executive is in compliance with the terms of this
Agreement as of the dates of the payments.


 


(k)                                  Certain Reduction of Payments by the
Company.


 


(i)                                     Notwithstanding anything
contained herein to the contrary, prior to the payment of any amounts pursuant
to Section 9(d) hereof, an independent national accounting firm
designated by the Company (the “Accounting Firm”) shall compute whether there
would be any “excess parachute payments” payable to Executive, within the
meaning of Section 280G of the Internal Revenue Code of 1986, as amended
(the “Code”), taking into account the total “parachute payments,” within the
meaning of Section 280G of the Code, payable to Executive by 


 


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the Company or any successor thereto under
this Agreement and any other plan, agreement or otherwise.  If there would be any excess parachute
payments, the Accounting Firm will compute the net after-tax proceeds to Executive,
taking into account the excise tax imposed by Section 4999 of the Code, if
(i) the payments hereunder were reduced, but not below zero, such that the
total parachute payments payable to Executive would not exceed three (3) times
the “base amount” as defined in Section 280G of the Code, less One Dollar
($1.00), or (ii) the payments hereunder were not reduced.  If reducing the payments hereunder would
result in a greater after-tax amount to Executive, such lesser amount shall be
paid to Executive.  If not reducing the
payments hereunder would result in a greater after-tax amount to Executive,
such payments shall not be reduced.  The
determination by the Accounting Firm shall be binding upon the Company and
Executive subject to the application of Section 9(k)(ii) hereof.


 


(ii)                                  As a result of uncertainty in the
application of Sections 280G of the Code, it is possible that excess parachute
payments will be paid when such payment would result in a lesser after-tax
amount to Executive; this is not the intent hereof.  In such cases, the payment of any excess
parachute payments will be void ab initio as regards any such
excess.  Any excess will be treated as an
overpayment by the Company to Executive. 
Executive will return the overpayment to the Company, within fifteen (15)
business days of any determination by the Accounting Firm that excess parachute
payments have been paid when not so intended, with interest at an annual rate
equal to the rate provided in Section 1274(d) of the Code (or 120% of
such rate if the Accounting Firm determines that such rate is necessary to
avoid an excise tax under Section 4999 of the Code) from the date
Executive received the excess until it is repaid to the Company.


 


(iii)                               All fees, costs and expenses (including,
but not limited to, the cost of retaining experts) of the Accounting Firm shall
be borne by the Company and the Company shall pay such fees, costs, and
expenses as they become due.  In
performing the computations required hereunder, the Accounting Firm shall
assume that taxes will be paid for state and federal purposes at the highest
possible marginal tax rates which could be applicable to Executive in the year
of receipt of the payments, unless Executive agrees otherwise.


 


10.                                 Return Of Property. 
Upon termination of Executive’s employment with the Company, Executive
shall deliver promptly to the Company all records, files, manuals, books,
forms, documents, letters, memoranda, data, customer lists, tables,
photographs, video tapes, audio tapes, computer disks and other computer storage
media, and copies thereof, that are the property of the Company, or that relate
in any way to the business, products, services, personnel, customers,
prospective customers, suppliers, practices, or techniques of the Company, and
all other property of the Company (such as, for example, computers, cellular
telephones, pagers, credit cards, and keys), whether or not containing
Confidential Information, that are in Executive’s possession or under Executive’s
control.


 


11.                                 Remedies.  Executive
acknowledges that it would be difficult to fully compensate the Company for
monetary damages resulting from any breach by Executive of the provisions of
Sections 5, 6, and 7 hereof. 
Accordingly, in the event of any actual or threatened breach of any such
provisions, the Company shall, in addition to any other remedies it may have,
be entitled to 


 


12

















 


injunctive and other
equitable relief to enforce such provisions, and such relief may be granted
without the necessity of proving actual monetary damages.


 


12.                                 Taxes.  This
Agreement is intended to satisfy, or be exempt from, the requirements of Section 409A(a)(2),
(3) and (4) of the Internal Revenue Code of 1986, as amended (“Code”),
including current and future guidance and regulations interpreting such
provisions.  If Executive is a “specified
employee” under Section 409A(a)(2)(B)(i) of the Code, then any
payment under this Agreement that is treated as deferred compensation under Section 409A
of the Code shall be delayed until the date which is six months after the date
of “separation from service” under the Code (without interest or earnings).


 


13.                                 Miscellaneous.


 


(a)                                  Governing Law.  This Agreement shall be governed by, subject
to, and construed in accordance with the laws of the State of Minnesota without
regard to conflict of law principles. 
Any action relating to this Agreement shall only be brought in a court
of competent jurisdiction in the State of Minnesota, and the parties consent to
the jurisdiction, venue and convenience of such courts.


 


(b)                                 Jurisdiction and Law. 
Executive and the Company consent to jurisdiction of the courts of the
State of Minnesota and/or the federal district courts, District of Minnesota,
for the purpose of resolving all issues of law, equity, or fact, arising out of
or in connection with this Agreement. 
Any action involving claims of a breach of this Agreement shall be
brought in such courts.  Each party
consents to personal jurisdiction over such party in the state and/or federal
courts of Minnesota and hereby waives any defense of lack of personal
jurisdiction or forum non conveniens.  Venue, for the purpose of all such suits,
shall be in Hennepin County, State of Minnesota.


 


(c)                                  Entire Agreement. 
This Agreement contains the entire agreement of the parties relating to
Executive’s employment with the Company and supersedes all prior agreements and
understandings with respect to such subject matter, and the parties hereto have
made no agreements, representations or warranties relating to the subject
matter of this Agreement that are not set forth herein.


 


(d)                                 Amendments.  No amendment
or modification of this Agreement shall be deemed effective unless made in
writing and signed by the parties hereto.


 


(e)                                  No Waiver.  No term or
condition of this Agreement shall be deemed to have been waived, except by a
statement in writing signed by the party against whom enforcement of the waiver
is sought.  Any written waiver shall not
be deemed a continuing waiver unless specifically stated, shall operate only as
to the specific term or condition waived and shall not constitute a waiver of
such term or condition for the future or as to any act other than that
specifically waived.


 


(f)                                    Assignment.  This
Agreement shall not be assignable, in whole or in part, by either party without
the prior written consent of the other party, except that the Company 


 


13

















 


may, without the consent
of Executive, assign its rights and obligations under this Agreement (i) to
any entity with which the Company may merge or consolidate, or (ii) to any
corporation or other person or business entity to which the Company may sell or
transfer all or substantially all of its assets; provided that such assignee is
a successor in interest to the Company’s business and assumes all obligations
of the Company under this Agreement. 
After any such assignment by the Company, the Company shall be
discharged from all further liability hereunder and such assignee shall thereafter
be deemed to be the “Company” for purposes of all terms and conditions of this
Agreement, including this Section 13.


 


(g)                                 Counterparts. 
This Agreement may be executed in any number of counterparts, and such
counterparts executed and delivered, each as an original, shall constitute but
one and the same instrument.


 


(h)                                 Severability. 
Subject to Section 6(f) hereof, to the extent that any portion
of 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.  The parties agree to negotiate in good faith
to replace any provision deleted as a result of this Section 13(h) with
a valid and enforceable provision intended to have a substantially similar
economic effect.


 


(i)                                     Survival.  The terms and
conditions set forth in Sections 4, 5, 6, 7, 8, 10, 11, 12 and 13 of this
Agreement, and any other provision that continues by its terms, shall survive
expiration of the Term or termination of Executive’s employment for any reason.


 


(j)                                     Captions and Headings. 
The captions and paragraph headings used in this Agreement are for
convenience of reference only and shall not affect the construction or
interpretation of this Agreement or any of the provisions hereof.


 


* * * * *


 


[Remainder of this page intentionally left blank.]


 


14

















 


IN WITNESS WHEREOF, Executive and the Company have
executed this Agreement as of the date set forth in the first paragraph.


 


 


	
   

  	
  GANDER MOUNTAIN COMPANY

  
	
   

  	
   

  
	
   

  	
  180
  East Fifth Street

  
	
   

  	
  Suite 1300

  
	
   

  	
  St. Paul, MN 55101

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/
  Richard C. Dell

  
	
   

  	
  Name

  	
  Richard
  C. Dell

  
	
   

  	
  Its

  	
  Chairman
  of Compensation Committee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Michael Owens

  
	
   

  	
  MICHAEL
  OWENS

  
					



 


[signature
page to Employment Agreement]


 

















EXHIBIT A –


FORM OF RELEASE


 


AGREEMENT AND RELEASE


by
Michael Owens


 


I.              Definitions.  I intend all words used in this
Agreement and Release (the “Release”) to have their plain meanings in ordinary
English.  Specific terms that I use in
this Release have the following meanings:


 


A.                                   I,  me, and my include both me and anyone
who has or obtains any legal rights or claims through me.


 


B.                                     Gander Mountain means Gander Mountain Company and any
company or other entity related to Gander Mountain Company in the past or
present, including without limitation, its predecessors, parents, subsidiaries,
affiliates and divisions, and any successors of Gander Mountain Company.


 


C.                                     Company means Gander Mountain and its past and present
directors, officers, committees, employees, agents, advisers, shareholders and
control persons or entities, the respective past and present fiduciaries of any
employee benefit or other plan sponsored or maintained by Gander Mountain, and
any other person who acted on behalf of Gander Mountain or on instructions from
Gander Mountain.


 


D.                                    Agreement means the Employment Agreement between me and Gander
Mountain that I entered into at the inception of my employment with Gander
Mountain, dated
                  
[, as amended on
                    ].


 


E.                                      My Claims mean all of my rights that I now have to any relief
of any kind from the Company, including without limitation:


 


1.                                       all claims arising out of or relating to
my employment with Gander Mountain or the termination of that employment;


 


2.                                       all claims arising out of or relating to
the statements, actions, or omissions of the Company;


 


3.                                       all claims for any alleged unlawful
discrimination, harassment, retaliation or reprisal, or other alleged unlawful
practices arising under any federal, state, or local statute, ordinance, or
regulation, including without limitation, claims under Title VII of the Civil
Rights Act of 1964, the Age Discrimination in Employment Act of 1967 as amended
by the Older Workers’ Benefit Protection Act of 1990, the Americans with
Disabilities Act (“ADA”), 42 U.S.C. Section1981, the Family and Medical Leave
Act (“FMLA”), the Employee Retirement Income Security Act (“ERISA”), the Equal
Pay Act, the Worker Adjustment and Retraining Notification Act (“WARN”), the
Fair Credit Reporting Act, the National Labor Relations 


 

















 


Act (“NLRA”), the Sarbanes-Oxley Act, and the
Minnesota Human Rights Act;


 


4.                                       all claims for alleged wrongful
discharge; breach of contract; breach of implied contract; failure to keep any
promise; breach of a covenant of good faith and fair dealing; breach of
fiduciary duty; estoppel; my activities, if any, as a “whistleblower”;
defamation; infliction of emotional distress; fraud; misrepresentation;
negligence; harassment; retaliation or reprisal; constructive discharge;
assault; battery; false imprisonment; invasion of privacy; interference with
contractual or business relationships; any other wrongful employment practices;
and violation of any other principle of common law;


 


5.                                       all claims for compensation and employee
benefits of any kind, including without limitation, bonuses, commissions,
deferred compensation, stock-based compensation, stock options, vacation pay,
perquisites, and expense reimbursements;


 


6.                                       all claims for back pay, front pay,
reinstatement, other equitable relief, compensatory damages, damages for
alleged personal injury, liquidated damages, and punitive damages; and


 


7.                                       all claims for attorneys’ fees, costs,
and interest.


 


However, My Claims
do not include any claims that applicable law does not allow to be waived , any
claims that may arise after the date on which I sign this Release, any claims
for breach of the Agreement, or any rights that I may have to indemnification
from Gander Mountain as a current or former officer, director, or employee of
Gander Mountain, including without limitation indemnification rights under
applicable laws, the charter documents of Gander Mountain, or any liability
policy maintained by Gander Mountain.


 


II.            Agreement to Release My
Claims.  I will receive consideration from the Company
as set forth in the Agreement if I sign and do not rescind this Release as
provided below.  I understand and
acknowledge that such consideration is in addition to anything of value that I
would be entitled to receive from Gander Mountain if I did not sign this
Release or if I rescinded this Release. 
In exchange for that consideration, I give up and forever release all of
My Claims.  I will not make any demands
or claims against the Company for compensation or damages relating to My
Claims.  The consideration that I am
receiving is a fair compromise for the release of My Claims.


 


I understand that nothing
in this Release shall be construed to prohibit me from filing a charge or a
complaint with, or participating in any investigation or proceeding conducted
by, the Equal Employment Opportunity Commission, the National Labor Relations
Board, or any comparable state or local agency charged with the enforcement of
any 


 


2

















 


employment laws, although
by signing this Release I understand I am waiving any right to monetary
recovery based on claims asserted in such a charge or complaint.


 


III.           No Admission of
Responsibility.  Even though Gander Mountain will provide
consideration for me to settle and release My Claims, the Company does not
admit that it is responsible or legally obligated to me.  In fact, the Company denies that it is
responsible or legally obligated to me for My Claims, denies that it engaged in
any unlawful or improper conduct toward me, and denies that it treated me
unfairly.


 


IV.           Confidentiality. 
I understand that the terms of this Release are confidential and that I
may not disclose those terms to any person except (i) to my spouse to the
extent such disclosure will not result in disclosing the terms of the Release
and/or the Agreement to members of the media or other members of the public; (ii) to
my legal or financial advisors; (iii) to a governmental taxing authority
in response to questions posed by such taxing authority; and (iv) as
otherwise required by law.


 


V.            Advice to Consult with
an Attorney.  I understand and acknowledge that I am hereby
being advised by the Company to consult with an attorney prior to signing this
Release and for the purpose of reviewing this Release.  My decision whether to sign this Release is
my own voluntary decision made with full knowledge that the Company has advised
me to consult with an attorney.


 


VI.           Period to Consider the
Release.  I understand that I have [select 21 or 45] days
from the day that I receive this Release, not counting the day upon which I
receive it, to consider whether I wish to sign this Release.   I have not been asked by the Company to
shorten my time period for consideration of whether to sign this Release.  The Company has not threatened to withdraw or
alter the benefits due me prior to the expiration of the [21- or 45]-day
period nor has the Company provided different terms to me because I have
decided to sign the Release prior to the expiration of the [21- or 45]-day
consideration period.  If I sign this
Release before the end of the [21- or 45]-day
period, it will be my voluntary decision to do so because I have decided that I
do not need any additional time to decide whether to sign this Release.  I also agree that any changes made to this
Release before I sign it, whether material or immaterial, will not restart the [21- or 45]-day period.


 


VII.         My Right to Rescind this
Release.  I understand that I may rescind this Release
at any time within 15 calendar days after I sign it, not counting the day upon
which I sign it.  This Release will not
become effective or enforceable unless and until the 15-day rescission period
has expired without my rescinding it. 
The Company will not pay the consideration under the Agreement until the
rescission period has expired and the Company has no obligation to pay if I
rescind.


 


VIII.        Procedure for Accepting
or Rescinding the Release.  To accept the
terms of this Release, I must deliver the Release, after I have signed and
dated it, to Gander Mountain by hand or by mail within the [21- or 45]-day
period that I have to consider this Release. 
To rescind my acceptance of this Release, I must deliver  a written, signed statement that I 


 


3

















 


rescind my acceptance to
Gander Mountain by hand or by mail within the 15-day rescission period.  All deliveries must be made to Gander
Mountain at the following address:


 


	
   

  	
  [Name]

  
	
   

  	
  General Counsel

  
	
   

  	
  Gander Mountain Company

  
	
   

  	
  180 East Fifth Street;
  Suite 1300

  
	
   

  	
  Saint Paul, MN 55101

  



 


If I choose to deliver
the rescission of my acceptance by mail, it must be:


 


	
   

  	
  (1)                    postmarked within the period stated
  above; and

  
	
   

  	
  (2)                    properly addressed to Gander Mountain
  at the address stated above.

  



 


IX.           Nondisparagement. 
I agree that I will not criticize, make any negative comments about or
otherwise disparage or put in disrepute the Company or those associated with
the Company in any way, whether orally, in writing or otherwise, directly or by
implication in communication with any person, including but not limited to,
customers, vendors, agents or current/former employees of the Company.  However, nothing in this paragraph shall
prohibit me from making statements if compelled by law or if I in good faith
believe such statements are necessary to fulfill my fiduciary obligations to
the Company.


 


Gander Mountain
agrees that it will not authorize any employee of Gander Mountain to criticize,
make any negative comments about or otherwise disparage or put me in disrepute
in any way, whether orally, in writing, or otherwise, directly or by
implication in communication with any person. 
However, nothing in this paragraph shall prohibit any employee of Gander
Mountain from making statements if compelled by law or if such employee in good
faith believes such statements are necessary to fulfill his or her fiduciary
obligations to the Company.


 


X.            Noncompetition. 
I acknowledge that as part of and in consideration of my employment with
the Company, I voluntarily signed the Agreement, which includes
confidentiality, non-solicitation and non-competition covenants (herein after
referred to as “Covenants”), on [Date].  The Company and I hereby re-affirm
the validity and enforceability of the Covenants, including without limitation
all of the terms and conditions contained in the Covenants.  I agree that the Covenants may be fully and
completely enforced against me should I breach any of the terms and conditions
contained in the Covenants.  I
acknowledge and agree that neither the separation of my employment, nor any of
the terms of this Release, shall affect the Covenants in any way, including
without limitation voiding or nullifying the Covenants.  Rather, the Covenants remain separate
agreements fully enforceable to the extent of the law applicable to the
Covenants.  I agree that the Covenants
were offered to me by the Company, accepted by me without coercion or duress
and supported by adequate consideration. 
I agree that I will never seek to argue of assert that the Covenants are
not enforceable against me.


 


4

















 


XI.           Interpretation of the
Release.  This Release should be interpreted as broadly
as possible to achieve my intention to resolve all of My Claims against the
Company.  If this Release is held by a
court to be inadequate to release a particular claim encompassed within My
Claims, this Release will remain in full force and effect with respect to all
the rest of My Claims.


 


XII.         My Representations. 
I am legally able and entitled to receive the consideration being
provided to me in settlement of My Claims. 
I have not been involved in any personal bankruptcy or other insolvency
proceedings at any time since I began my employment with Gander Mountain.  No child support orders, garnishment orders,
or other orders requiring that money owed to me by Gander Mountain be paid to
any other person are now in effect, except as reflected in my personnel file as
of (Date).


 


I have read this Release
carefully.  I understand all of its terms.  In signing this Release, I have not relied on
any statements or explanations made by the Company except as specifically set
forth in the Agreement and the Release. 
I am voluntarily and knowingly releasing My Claims against the
Company.  I intend this Release to be
legally binding.


 


XIII.        Governing Law. 
I understand that this Release will be governed by, subject to, and
construed in accordance with the laws of the State of Minnesota without regard
to conflict of laws principles.


 


 




	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Michael Owens

  






 


5