GameStop 2005 Annual Report Download - page 61

Shares
Acquired
on Exercise
Value
Realized Exercisable Unexercisable Exercisable Unexercisable
Number of Securities
Underlying Unexercised
Options at Fiscal Year End
Value of Unexercised
In-the-Money Options at
Fiscal Year End
Aggregated Option/SAR Exercises in Last Fiscal Year
and
Fiscal Year End Option/SAR Values
(Shs.) ($)
Steven R. Morgan
GameStop Class A
Common Stock . . . . . . . . — — — — — —
David W. Carlson
GameStop Class A
Common Stock . . . . . . . . 20,000 685,000 586,000 140,000 15,165,000 2,855,000
Ronald Freeman
GameStop Class A
Common Stock . . . . . . . . 76,000 563,500 — 113,000 — 2,234,000
For information on our equity compensation plans, please see Item 5 of this Annual Report on Form 10-K.
Employment Agreements
GameStop has entered into employment agreements with R. Richard Fontaine, Daniel A. DeMatteo, Steven R.
Morgan and David W. Carlson. The terms of the employment agreements for Mr. Fontaine and Mr. DeMatteo
commenced on April 11, 2005 and continue for a period of three years thereafter, with automatic annual renewals
thereafter unless either party gives notice of non-renewal at least six months prior to automatic renewal. The term of
the employment agreement for Mr. Morgan commenced on December 9, 2005 and continues through February 12,
2008, with automatic annual renewals thereafter unless either party gives notice of non-renewal at least six months
prior to automatic renewal. The term of the employment agreement for Mr. Carlson commenced on April 3, 2006
and continues for a period of two years thereafter, with automatic annual renewals thereafter unless either party
gives notice of non-renewal at least six months prior to automatic renewal.
Mr. Fontaine’s minimum annual salary during the term of his employment under the employment agreement
shall be no less than $650,000. Mr. DeMatteo’s minimum annual salary during the term of his employment under
the employment agreement shall be no less than $535,000. The Board of Directors of the Company has set
Mr. Fontaine’s and Mr. DeMatteo’s salaries for fiscal 2006 at $1,000,000 and $800,000, respectively. Mr. Morgan’s
minimum annual salary during the term of his employment under the employment agreement shall be no less than
$450,000. Mr. Carlson’s minimum annual salary during the term of his employment under the employment
agreement shall be no less than $350,000. Annual bonus compensation will be based on the formula and targets
established under and in accordance with GameStop’s Supplemental Compensation Plan.
Each executive shall be entitled to all benefits afforded to key management personnel or as determined by the
board of directors of GameStop, including, but not limited to, stock and stock option benefits, insurance programs,
pension plans, vacation, sick leave, expense accounts and retirement benefits.
Each executive’s employment may be terminated upon death, disability, by GameStop with or without cause or
by the executive within twelve months of a good reason event. A good reason event is defined as a change of control,
a reduction in compensation or a material reduction in benefits or responsibilities, or a relocation of at least 50 miles.
Among other things, the employment agreement includes a severance arrangement if the executive is terminated by
GameStop without cause or by the executive for good reason which provides each executive with his base salary
through the term of the agreement, plus the average of the last three annual bonuses, with a one year minimum, plus
the continuation of medical benefits for 18 months and the release of all stock option restrictions.
Each executive is also restricted from competing with GameStop for the later of the expiration of the term of
the agreement or one year after termination of employment, unless the contract is terminated by GameStop without
cause or the executive for good reason.
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