DEF 14A 1 gamestop2016definitiveprox.htm DEF 14A DEF 14A

 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No.    )
Filed by the Registrant  þ                            Filed by a Party other than the Registrant  ¨
Check the appropriate box:  
¨
Preliminary Proxy Statement
¨
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
þ
Definitive Proxy Statement
¨
Definitive Additional Materials
¨
Soliciting Material Pursuant to (§)240.14a-12
 
GameStop Corp.
(Name of Registrant as Specified In Its Charter)
 
(Name of Person(s) Filing Proxy Statement, if Other than the Registrant)
 
Payment of Filing Fee (Check the appropriate box):
 
 
þ
No fee required.
 
 
¨
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
 
 
 
 
(1)
Title of each class of securities to which transaction applies: 
 
 
 
 
(2)
Aggregate number of securities to which transaction applies:
 
 
 
 
(3)
Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
 
 
 
 
(4)
Proposed maximum aggregate value of transaction:
 
 
 
 
(5)
Total fee paid:
 
 
 
¨
Fee paid previously with preliminary materials.
 
 
¨
Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
 
 
 
 
(1)
Amount Previously Paid:
 
 
 
 
(2)
Form, Schedule or Registration Statement No.:
 
 
 
 
(3)
Filing Party:
 
 
 
 
(4)
Date Filed:

 



 
625 Westport Parkway Grapevine, Texas 76051 (817) 424-2000

Notice of Annual Meeting of Stockholders
To Be Held June 21, 2016

Dear Stockholder:
We invite you to attend our Annual Meeting of Stockholders on Tuesday, June 21, 2016 at 1:00 p.m., Central Daylight Time, at GameStop's Corporate Headquarters, 625 Westport Parkway, Grapevine, Texas 76051.
At the annual meeting we will ask you to:
elect 10 directors, each to serve as a member of our Board of Directors until the next annual meeting of stockholders and until such director's successor is elected and qualified;
provide an advisory, non-binding vote on the compensation of our named executive officers;
ratify our Audit Committee’s appointment of Deloitte & Touche LLP as our independent registered public accounting firm for our fiscal year ending January 28, 2017; and
approve an amendment and restatement of our certificate of incorporation to change the shareholder voting requirement for removal of directors from a supermajority (80%) of shareholders and only for cause, to a simple majority of shareholders with or without cause, and to make other technical and conforming changes.

We will also transact such other business as may properly come before the annual meeting and at any adjournment or postponement of the annual meeting. Our Proxy Statement provides information that you should consider when you vote your shares.
Only holders of record of our Class A Common Stock, par value $.001 per share, at the close of business on April 29, 2016 are entitled to vote at the annual meeting or at any adjournment or postponement of the annual meeting.
This year we are again providing access to our proxy materials over the Internet under the U.S. Securities and Exchange Commission’s “notice and access” rules. As a result, we are mailing to many of our stockholders a notice instead of a paper copy of this proxy statement and our 2015 Annual Report. This notice contains instructions on how to access those documents over the Internet. The notice also contains instructions on how each of these stockholders can receive a paper copy of our proxy materials, including this proxy statement, our 2015 Annual Report, and a form of proxy card or voting instruction card. All stockholders who do not receive a notice, including stockholders who have previously requested to receive paper copies of proxy materials, will receive a paper copy of the proxy materials by mail unless they have previously requested delivery of proxy materials electronically. Continuing to employ this distribution process will conserve natural resources and reduce the costs of printing and distributing our proxy materials.

Your vote is important to us. Whether or not you plan to attend the annual meeting, please vote your shares electronically via the Internet, by telephone or, if you receive a paper copy of the proxy materials, by signing, dating and completing the accompanying proxy card in the enclosed postage-paid envelope. Voting electronically via the Internet, by telephone, or by returning your proxy card in advance of the annual meeting does not deprive you of your right to attend the annual meeting. If you attend the annual meeting, you may vote your shares in person, even if you have previously submitted a proxy in writing, by telephone or via the Internet. Our Proxy Statement includes additional instructions on voting procedures for stockholders whose shares are held by a brokerage firm or other custodian.
Thank you for your continued interest in GameStop Corp.

Sincerely,


Daniel A. DeMatteo
Executive Chairman
May 6, 2016





 
625 Westport Parkway Grapevine, Texas 76051 (817) 424-2000

Proxy Statement for the Annual Meeting of Stockholders
To Be Held June 21, 2016

The Annual Meeting of Stockholders of GameStop Corp. will be held at GameStop's Corporate Headquarters, 625 Westport Parkway, Grapevine, Texas 76051 on Tuesday, June 21, 2016 at 1:00 p.m., Central Daylight Time, for the following purposes:
(1)
To elect 10 directors, each to serve as a member of our Board of Directors until the next annual meeting of stockholders and until such director's successor is elected and qualified.
(2)
To provide an advisory, non-binding vote on the compensation of our named executive officers.
(3)
To ratify our Audit Committee’s appointment of Deloitte & Touche LLP as our independent registered public accounting firm for our fiscal year ending January 28, 2017.
(4)
To approve an amendment and restatement of our certificate of incorporation to change the shareholder voting requirement for removal of directors from a supermajority (80%) of shareholders and only for cause, to a simple majority of shareholders with or without cause, and to make other technical and conforming changes.
Only holders of record of our Class A Common Stock, par value $.001 per share, as of the close of business on April 29, 2016 are entitled to notice of, and to vote at, the annual meeting or at any adjournment or postponement of the annual meeting. We refer throughout this Proxy Statement to our Class A Common Stock as our common stock.
Our Board of Directors knows of no other business that will be presented for consideration at the annual meeting. If any other matter should be properly presented at the annual meeting or any adjournment or postponement of the annual meeting for action by the stockholders, the persons named in the proxy card will vote the proxy in accordance with their best judgment on such matter.
On or about May 6, 2016, we mailed to stockholders a Notice of Internet Availability of Proxy Materials, which contains instructions on how to access this Proxy Statement, a form of proxy and our 2015 Annual Report. This Proxy Statement and the form of proxy are first being distributed and made available to stockholders on or about May 6, 2016.


Instead of receiving paper copies of future annual reports and proxy statements in the mail, you can elect to receive an e-mail that will provide an electronic link to these documents. Choosing to receive your proxy materials online will save us the cost of producing and mailing documents to you and will conserve natural resources. With electronic delivery, we will notify you by e-mail as soon as the Annual Report and Proxy Statement are available on the Internet, and you can easily submit your stockholder votes online. If you are a stockholder of record, you may enroll in the electronic delivery service at the time you vote by selecting electronic delivery if you vote on the Internet, or at any time in the future by going directly to www.proxypush.com/GME, selecting the “Request Materials” option, and following the enrollment instructions.


Important Notice Regarding the Availability of Proxy Materials
for the Annual Meeting of Stockholders to be Held on June 21, 2016
This Proxy Statement, form of proxy and 2015 Annual Report are available at http://investor.gamestop.com
Except as otherwise stated, information on our website is not a part of this Proxy Statement




TABLE OF CONTENTS
 
Page



Information About The Annual Meeting and Voting
What Am I Voting on?
Our Board of Directors ("Board") of GameStop Corp. (“GameStop”, “the Company”, “we”, “us”, or “our”) is soliciting your vote “for”:
The election of 10 directors to serve on the Board until the next annual meeting of stockholders and until their successors are elected and qualified.
Ratification of our Audit Committee’s appointment of Deloitte & Touche LLP as our independent registered public accounting firm for our fiscal year ending January 28, 2017.
An amendment and restatement of our certificate of incorporation to change the shareholder voting requirement for removal of directors from a supermajority (80%) of shareholders and only for cause, to a simple majority of shareholders with or without cause, and to make other technical and conforming changes.
The Board is also requesting you to cast an advisory, non-binding vote “for”:
The compensation of our Named Executive Officers (as defined below in “Election of Directors─Executive Officers”).
The Board knows of no other business that will be presented for consideration at the annual meeting. If any other matter should be properly presented at the annual meeting or any adjournment or postponement of the annual meeting for action by the stockholders, the persons named in the proxy card will vote the proxy in accordance with their best judgment on such matter.
What Are the Board’s Recommendations?
The Board recommends that you vote:
FOR the election of the 10 nominees identified in this Proxy Statement to serve as directors;
FOR the approval, on an advisory, non-binding basis, of the compensation of our Named Executive Officers; and
FOR the ratification of our Audit Committee's appointment of Deloitte & Touche LLP as our independent registered public accounting firm for our fiscal year ending January 28, 2017.
FOR the amendment and restatement of our certificate of incorporation to provide that any director may be removed from office with or without cause by majority stockholder vote and to make other technical and conforming changes.
Who Is Entitled to Vote?
Holders of shares of common stock of record as of the close of business on April 29, 2016 are entitled to notice of and to vote at the annual meeting. Shares of common stock can be voted only if the stockholder is present in person or is represented by proxy at the annual meeting. As of the record date, 103,951,952 shares of common stock were issued and outstanding and entitled to vote.
How Do I Vote?
Stockholders of Record. If you are a stockholder of record, there are several ways for you to vote your shares of common stock at the annual meeting:
Voting by Internet. You may vote your shares through the Internet by signing on to the website www.proxypush.com/GME and following the procedures described therein. Internet voting is available 24 hours a day, and the procedures are designed to authenticate votes cast by using a personal identification number located on the proxy card. The procedures allow you to appoint a proxy to vote your shares and to confirm that your instructions have been properly recorded. If you vote through the Internet, you should not return your proxy card.
Voting by Mail. If you choose to vote by mail, simply complete the enclosed proxy card, date and sign it, and return it in the postage-paid envelope provided. If you sign your proxy card and return it without marking any voting instructions, your shares will be voted: (1) FOR the election of the 10 nominees for director identified in this Proxy Statement; (2) FOR the approval of the compensation of our Named Executive Officers; (3) FOR the ratification of our Audit Committee’s appointment of Deloitte & Touche LLP as our independent registered public accounting firm for our fiscal year ending January 28, 2017; and (4) FOR the ratification of an amendment and restatement of our certificate of incorporation to provide that any director may be removed from office with or without cause by majority stockholder vote and to make other technical and conforming changes.
Voting by Telephone. You may vote your shares by telephone by calling toll-free 1-800-652-VOTE (8683). Telephone voting is available 24 hours a day, and the procedures are designed to authenticate votes cast by using a personal identification number

2


located on the proxy card. The procedures allow you to appoint a proxy to vote your shares and to confirm that your instructions have been properly recorded. If you vote by telephone, you should not return your proxy card.
In Person Attendance. You may vote your shares in person at the annual meeting. Even if you plan to attend the annual meeting in person, we recommend that you submit your proxy card or voting instructions or vote by telephone or via the Internet by the applicable deadline so that your vote will be counted if you later decide not to attend the annual meeting.
Beneficial Owners. If you are a stockholder whose shares are held in “street name” (i.e., in the name of a broker or other custodian) you may vote the shares in person at the annual meeting only if you obtain a legal proxy from the broker or other custodian giving you the right to vote the shares. Alternatively, you may have your shares voted at the annual meeting by following the voting instructions provided to you by your broker or custodian. Although most brokers offer voting by mail, telephone and via the Internet, availability and specific procedures will depend on their voting arrangements. If you do not provide voting instructions to your broker or other custodian, your shares are referred to as “uninstructed shares.” Under rules of the New York Stock Exchange ("NYSE"), your broker or other custodian does not have discretion to vote uninstructed shares on non-routine matters, such as Proposals 1, 2 and 4, and, accordingly, may not vote uninstructed shares in the votes on such Proposals. However, your broker or other custodian has discretion to vote your shares on Proposal 3 (Ratification of the Appointment of our Independent Registered Public Accounting Firm). See below “What is a Broker Non-Vote?”
How You May Revoke or Change Your Vote
You may revoke your proxy at any time before it is voted at the annual meeting by any of the following methods:
Submitting a later-dated proxy by mail, over the telephone or through the Internet.
Sending a written notice, including by fax, to our Secretary. You must send any written notice of a revocation of a proxy so as to be delivered before the taking of the vote at the annual meeting to:
GameStop Corp
625 Westport Parkway
Grapevine, Texas 76051
Attention: Secretary
Attending the annual meeting and voting in person. Your attendance at the annual meeting will not in and of itself revoke your proxy. You must also vote your shares at the annual meeting.
What Constitutes a Quorum?
A quorum of common stockholders is required to hold a valid annual meeting of stockholders. Unless a quorum is present at the annual meeting, no action may be taken at the annual meeting except the adjournment thereof to a later time. The holders of a majority of the outstanding shares of common stock entitled to vote at the meeting must be present in person or by proxy to constitute a quorum. All valid proxies returned will be included in the determination of whether a quorum is present at the annual meeting. The shares of a stockholder whose ballot on any or all proposals is marked as “abstain” will be treated as present for quorum purposes. If a broker indicates on the proxy that it does not have discretionary authority as to certain shares to vote on a particular matter, those uninstructed shares, constituting “broker non-votes,” will be considered as present for determining a quorum, but will not be voted with respect to that matter.
What Is a Broker Non-Vote?
A “broker non-vote” occurs when a nominee (such as a custodian or bank) holding shares for a beneficial owner returns a signed proxy but does not vote on a particular proposal because the nominee does not have discretionary voting power with respect to that item and has not received instructions from the beneficial owner.
What Vote Is Required to Approve Each Proposal?
Voting Rights Generally. Each share of common stock is entitled to one vote on each matter to be voted on at the annual meeting. Stockholders have no cumulative voting rights. Although the advisory vote on Proposal 2 is non-binding, as provided by law, the Compensation Committee of the Board and the Board will review the results of the vote and, consistent with our record of stockholder engagement, will consider the results of the vote when making future compensation decisions.
Election of Directors. Our Bylaws provide that, in an uncontested election, a nominee for director is elected only if such nominee receives the affirmative vote of a majority of the total votes cast for and against such nominee. The majority voting standard would not apply in contested elections, and directors are elected by a plurality of the votes cast in a contested election.
The majority voting standard will apply to the election of directors at the 2016 annual meeting. Accordingly, a nominee for election to the Board will be elected if the number of votes cast “for” such nominee exceeds the number of votes cast “against” that nominee.

3


Abstentions and broker non-votes will not be treated as votes cast for the election of a director and will therefore have no effect on the result of such vote.
The Board has also adopted a resignation policy which is included in our Bylaws, under which a director nominated for re-election who fails to receive the required majority of votes cast for re-election will be required to tender his or her resignation to the Board. Within 90 days following certification of the stockholder vote, the Nominating and Corporate Governance Committee of the Board will be required to recommend to the Board whether the Board should accept the resignation, and the Board will be required to act on the recommendation, taking into account any factors it considers relevant, and publicly disclose its decision and the rationale behind it. The director whose resignation is under consideration will not participate in the recommendation of the Nominating and Corporate Governance Committee or the decision of the Board regarding his or her resignation.
Advisory Vote on Executive Compensation. Approval on an advisory, non-binding basis of the compensation of our Named Executive Officers requires the affirmative vote of a majority of all votes cast on this Proposal. Abstentions and broker non-votes will therefore have no effect on the result of such vote. As an advisory vote, the proposal to approve the compensation of our Named Executive Officers is not binding upon us. However, the Compensation Committee of the Board, which is responsible for designing and administering our executive compensation programs, and the Board, value the opinions expressed by our stockholders and will consider the results of the vote when making future compensation decisions.
Ratification of Appointment of Independent Registered Public Accounting Firm. Ratification of our Audit Committee’s appointment of Deloitte & Touche LLP as our independent registered public accounting firm for our fiscal year ending January 28, 2017 requires the affirmative vote of a majority of all votes cast on this Proposal. Abstentions and broker non-votes, if any, will therefore have no effect on the result of such vote.
Amendment and Restatement of Our Certificate of Incorporation. Amendment and restatement of our certificate of incorporation to change the shareholder voting requirement for removal of directors from a supermajority (80%) of shareholders and only for cause, to a simple majority of shareholders with or without cause, and to make other technical and conforming changes requires the affirmative vote of at least 80% of all outstanding shares of common stock entitled to vote. Abstentions and broker non-votes will therefore have the same effect as votes cast against such proposal.
Who Counts the Votes?
We have engaged Computershare, our transfer agent, as our inspector of elections to receive and tabulate votes. Computershare will separately tabulate “for” and “against” votes, abstentions and broker non-votes. Computershare will also certify the results and determine the existence of a quorum and the validity of proxies and ballots.
What Does it Mean if I Receive More Than One Proxy Card?
Some of your shares may be registered differently or held in more than one account. You should vote each of your accounts by telephone or the Internet or mail. If you mail proxy cards, please sign, date and return each proxy card to assure that all of your shares are voted. If you hold your shares in registered form and wish to combine your stockholder accounts in the future, you should contact our transfer agent, Computershare, at P.O. Box 30170, College Station, TX 77842-2170; or by calling Computershare at 1-800-522-6645 (outside the United States, phone 1-201-680-6578) and providing such information. Combining accounts reduces excess printing and mailing costs, resulting in savings for us that benefit you as a stockholder.
Who Pays the Cost of Solicitation of Proxies?
We will pay for the cost of preparing, assembling, printing, mailing and distributing these proxy materials. Our directors, officers and employees may solicit proxies or votes in person, by telephone, or by electronic communication. Such individuals will not receive any additional compensation for these solicitation activities. We have engaged Computershare, our transfer agent, as our inspector of elections to receive and tabulate votes. Computershare will separately tabulate “for” and “against” votes, abstentions and broker non-votes. Computershare will also certify the results and determine the existence of a quorum and the validity of proxies and ballots.
What if I Receive Only One Set of Proxy Materials Although There Are Multiple Stockholders at My Address?
If you and other residents at your mailing address own shares of common stock you may have received a notice that your household will receive only one Annual Report, Proxy Statement and Notice of Internet Availability of Proxy Materials. If you hold shares of common stock in street name, you may have received this notice from your broker or other custodian and the notice may apply to each company in which you hold shares through that broker or custodian. This practice of sending only one copy of proxy materials is known as “householding.” The reason we do this is to attempt to conserve natural resources. If you did not respond to a timely notice that you did not want to participate in householding, you were deemed to have consented to the process. If the foregoing procedures apply to you, one copy of our Annual Report, Proxy Statement and Notice of Internet Availability of Proxy Materials has been sent to your address.

4


You may revoke your consent to householding at any time by sending your name, the name of your brokerage firm, and your account number to Computershare at P.O. Box 30170, College Station, TX 77842-2170; or by calling Computershare at 1-800-522-6645 (outside the United States, phone 1-201-680-6578) and providing such information. The revocation of your consent to householding will be effective 30 days following its receipt. In any event, if you did not receive an individual copy of this Proxy Statement, our Annual Report and Notice of Internet Availability of Proxy Materials, we will send a copy to you, free of charge, if you address your written request to GameStop Corp., 625 Westport Parkway, Grapevine, Texas 76051, Attention: Matt Hodges, Vice President of Public and Investor Relations or by calling at (817) 424-2000. If you are receiving multiple copies of our Annual Report, Proxy Statement and Notice of Internet Availability of Proxy Materials, you can request householding by contacting Investor Relations in the same manner.
How Do I Submit a Stockholder Proposal for Next Year’s Annual Meeting?
Stockholder proposals may be submitted for inclusion in the Proxy Statement for our 2017 annual meeting of stockholders in accordance with rules of the Securities and Exchange Commission (“SEC”) and the advance notice provisions summarized later in this Proxy Statement under “Other Matters - Stockholder Proposals and Nominations for the 2017 Annual Meeting.” Proposals should be sent via registered, certified, or express mail to: Secretary, GameStop Corp., 625 Westport Parkway, Grapevine, Texas 76051.
What is Included in the Proxy Materials?
We have furnished our 2015 Annual Report with this Proxy Statement. The 2015 Annual Report includes our audited financial statements for our fiscal year ended January 30, 2016 ("fiscal 2015"), along with other financial information about us. Our 2015 Annual Report is not part of the proxy solicitation materials.
You can obtain, free of charge, a copy of our Form 10-K, as amended, which includes our audited financial statements, by:
accessing our website at www.gamestop.com and clicking on the “Investor Relations” link within the “Corporate” link;
writing to Matt Hodges, our Vice President of Public and Investor Relations, at 625 Westport Parkway, Grapevine, Texas 76051; or
calling at: (817) 424-2000.
You can also obtain a copy of our Form 10-K, as amended, and other periodic filings that we make with the SEC from the SEC’s EDGAR database at www.sec.gov.
How Can I Access the Proxy Materials Electronically?
Your notice of the Internet availability of the proxy materials, proxy or voting instruction card will contain instructions on how to:
view our proxy materials for the annual meeting on the Internet; and
instruct us to send our future proxy materials to you electronically by e-mail.
Our proxy materials are also available on our website at http://investor.gamestop.com and clicking on the “Investor Relations” link then the “Shareholder Info” link. Our proxy materials will be available during the voting period on www.proxypush.com/GME.
Your notice of Internet availability of the proxy materials, proxy card or voting instruction card will contain instructions on how you may request access to proxy materials electronically on an ongoing basis. Choosing to access your future proxy materials electronically will help us conserve natural resources and reduce the costs of printing and distributing our proxy materials. If you choose to access future proxy materials electronically, you will receive an e-mail with instructions containing a link to the website where those materials are available and a link to the proxy voting website. Your election to access proxy materials by e-mail will remain in effect until you terminate it.

5




ELECTION OF DIRECTORS
PROPOSAL 1
Information Concerning the Directors and Nominees
Composition of the Board
The Board currently consists of 11 directors. Each current director is standing for reelection except for Mr. Fontaine, who will be retiring at the end of his term in June 2016. Following the Annual Meeting, the Board will be comprised of ten directors.
The Board has established a director retirement age of 72, unless the Executive Chairman grants a waiver as permitted under the retirement policy. As indicated below, R. Richard Fontaine is over the age of 72; however, given Mr. Fontaine’s value to the Board and the Company, Mr. DeMatteo, as Executive Chairman, granted this waiver. Background information and qualifications with respect to our Board and nominees for election as directors appear below. See “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters” for information regarding such persons’ holdings of equity securities of the Company.
The following table sets forth the names and ages of our current directors, the year they first became a director, the positions they hold with the Company, and the standing committees of the Board on which they serve as of April 29, 2016:
Name 
 
Age
 
Director Since*
 
Position with the Company
 
Audit Committee
 
Compensation Committee
 
Nominating & Corporate Governance Committee
Daniel A. DeMatteo
 
68
 
2002
 
Executive Chairman and Director
 
 
 
 
 
 
J. Paul Raines
 
52
 
2012
 
Chief Executive Officer and Director
 
 
 
 
 
 
Jerome L. Davis
 
61
 
2005
 
Director
 
 
 
 
 
     x **
R. Richard Fontaine
 
74
 
2001
 
Director (1)
 
 
 
 
 
 
Thomas N. Kelly Jr.
 
69
 
2012
 
Director
 
 
 
x
 
 
Shane S. Kim
 
53
 
2011
 
Director
 
 
 
x
 
 
Steven R. Koonin
 
58
 
2007
 
Director
 
 
 
 
 
x
Stephanie M. Shern
 
68
 
2002
 
Director
 
     x **
 
 
 
 
Gerald R. Szczepanski
 
67
 
2002
 
Director
 
 
 
     x **
 
 
Kathy P. Vrabeck
 
52
 
2012
 
Director
 
x
 
 
 
 
Lawrence S. Zilavy
 
65
 
2005
 
Director (2)
 
x
 
 
 
x
 
*
Includes predecessor companies
**
Committee Chair
(1) 
Mr. Fontaine will retire from the Board effective June 21, 2016.
(2) 
Lead Independent Director
The Board believes that each director has valuable individual skills and experiences that, taken together, provide us with the variety and depth of knowledge necessary for effective oversight, direction and vision for the Company. As indicated in the following biographies, our directors have extensive experience in a variety of fields including retail, entertainment, video games, consumer marketing, finance, real estate, consulting and communications, each of which the Board believes provides valuable knowledge related to the key components of the Company’s business. In addition, the Board also believes that its Board members and nominees, as indicated in the following biographies, have each demonstrated significant leadership skills as a chief executive officer or chief operating officer, as a senior partner in a large services firm or as executive management in other large corporations. All of our current Board members have experience in oversight of publicly-traded companies due to their experience on the Board and the boards of directors of other companies. The Board believes that the skills and experience of each standing director and nominee qualify them to serve as a director of the Company.
Nominees for Election as Director
The following individuals are nominees for director at the 2016 annual meeting:
Daniel A. DeMatteo is a director and Executive Chairman, a position he has held since June 2010. He served as our Chief Executive Officer from August 2008 to June 2010. He served as Vice Chairman and Chief Operating Officer from March 2005 to August 2008. Prior to March 2005, Mr. DeMatteo served as President and Chief Operating Officer of the Company or our predecessor companies since

6


November 1996. He has served on the Board since 2002 and has been an executive officer in the video game industry since 1988. Mr. DeMatteo is also serving on the Board of Directors of Barnes & Noble Education.
Director Qualifications: Mr. DeMatteo brings to the Board 20 years of experience growing GameStop and its predecessor companies into the world’s largest omnichannel video game retailer and over 25 years of experience as an executive officer in the video game industry. As one of the founders of GameStop, Mr. DeMatteo has demonstrated a record of leadership, innovation and achievement. With his experience with the Company in the roles of Executive Chairman, Vice Chairman, Chief Executive Officer, President and Chief Operating Officer, Mr. DeMatteo provides the Board a unique and valuable perspective on the Company’s operations, strategy and business, including his perspective on the formula for success that has brought the Company to its current industry-leading position. The Company also benefits from Mr. DeMatteo’s entrepreneurial spirit and his extensive network of contacts and relationships within the video game industry as we pursue new opportunities in our continued business transformation.
J. Paul Raines is a director and is our Chief Executive Officer. Prior to being named Chief Executive Officer in June 2010, he served as Chief Operating Officer, a position he held since joining the Company in September 2008. As Chief Executive Officer, Mr. Raines has led the on-going transformation of GameStop from the leading global physical video game retailer into a global family of specialty retail brands by building online and digital platforms and expanding the Company’s efforts beyond the video game category, to include a portfolio of AT&T wireless and Apple technology retail brands through its acquisition of Spring Mobile and Simply Mac. Today, GameStop is a family of specialty retail brands that makes our customers' favorite technologies affordable and simple.
Prior to joining GameStop, Mr. Raines spent eight years with The Home Depot, Inc., a home improvement retailer (“Home Depot”) in various management positions in retail operations, including as Executive Vice President of U.S. Stores and President of the Southern Division. Prior to Home Depot, he spent four years in global sourcing for L.L. Bean, Inc., a privately-held outdoor apparel and equipment retailer, and 10 years with Kurt Salmon Associates in their consumer products group. Mr. Raines serves on the Board of Directors of J.C. Penney Company, Inc. ("J.C. Penney"). Mr. Raines is also serving on the Board of Directors of Advance Auto Parts, Inc. (“Advance Auto Parts”) until his term ends at its annual meeting in May 2016, where he is a member of the Finance Committee and has previously served on the Nominating and Corporate Governance Committee. He also serves on the Board of Trustees of the Georgia Tech Foundation, a non-profit organization.
Director Qualifications: Mr. Raines brings to the Board extensive experience in the strategic, operational and merchandising aspects of retail businesses. He also has broad international experience in Latin America, Europe and Asia. The Board benefits from Mr. Raines’ insights gained from his experience and expertise in the areas of retail store operations, customer service, manufacturing, marketing, loss prevention, real estate, supply chain and global sourcing. Additionally, Mr. Raines’ service on the Advance Auto Parts Board of Directors and two of its committees and service on the J.C. Penney Board of Directors provides the Board with a unique perspective into corporate management and board dynamics at other retail public companies.
Jerome L. Davis is a director and Chair of the Nominating and Corporate Governance Committee. Mr. Davis has served as a director since October 2005. Mr. Davis is Executive Vice President & Chief Revenue Officer for Metropolitan Washington Airports Authority, an independent airport authority, in Washington, D.C. since September 2014.  Mr. Davis was President of Jerome L. Davis & Associates, LLC, a consulting firm focusing on executive coaching and leadership development from 2006 until August 2014. He previously served as Corporate Vice President of Food and Retail for Waste Management, Inc., the leading provider of integrated environmental solutions in North America, from January 2010 to June 2012. Mr. Davis was Global Vice President, Service Excellence for Electronic Data Systems, a business and technology services company, from July 2003 until October 2005. From May 2001 to July 2003, he served in various capacities at Electronic Data Systems, including Chief Client Executive Officer and President, Americas for Business Process Management. Prior to joining Electronic Data Systems, Mr. Davis served as President and Executive Officer of the Commercial Solutions Division of Maytag Corporation, a home and commercial appliance company, from October 1999 until May 2001. Mr. Davis served as Senior Vice President of Sales and Corporate Officer for Maytag Appliances Division from March 1998 to September 1999. From March 1992 to February 1998, Mr. Davis was Vice President of National Accounts and Area Vice President for Frito Lay, a division of PepsiCo that manufactures, markets and sells corn chips, potato chips and other snack foods ("Frito Lay"). Mr. Davis also held senior executive positions in Sales and Marketing with Procter & Gamble, a consumer goods company, from 1977 to 1992. Mr. Davis is currently a director and a member of the Compensation Committee and the Nominating and Corporate Governance Committee of Apogee Enterprises, Inc. (“Apogee”), where he has been a director since 2004. He previously chaired the Finance and Enterprise Risks Committee of Apogee for five years.
Director Qualifications: Mr. Davis brings to the Board more than 35 years of experience in Fortune 500 growth oriented companies and extensive expertise and insight in multiple areas including marketing and sales, strategy development, international business, leadership development, succession planning, real estate development, executive compensation and information technology. In addition, his experience as a director of Apogee, including committee service, has given him insights and perspectives on finance, governance, human resources and compensation which benefit the Board.
Thomas N. Kelly Jr. is a director and a member of the Compensation Committee. He has served as a director since July 2012. Mr. Kelly served as Executive Vice President, Transition Integration of Sprint Nextel Corp., a global communications company ("Sprint Nextel"), from December 2005 until April 2006. He served as the Chief Strategy Officer of Sprint Nextel from August 2005 until December 2005. He served as the Executive Vice President and Chief Operating Officer of Nextel Communications, Inc., a global communications

7


company (“Nextel”), which became Sprint Nextel, from February 2003 until August 2005, and as Executive Vice President and Chief Marketing Officer of Nextel from 1996 until February 2003. Mr. Kelly currently serves on the Board of The Scotts Miracle Gro Company (“Scotts Miracle Gro") where he has served as Lead Independent Director and currently serves as the Chairperson of the Innovation and Technology Committee, and a member of the Audit Committee and the Compensation and Organization Committee.
Director Qualifications: Mr. Kelly brings to the Board extensive board experience as well as more than 25 years of leadership in the communications and wireless industries. His broad business knowledge in the communications and wireless industries brings valuable insight in supporting the advancement of our mobile wireless retail and digital strategies.
Shane S. Kim is a director and a member of the Compensation Committee. He has served as a director since July 2011. Mr. Kim worked for Microsoft Corporation, leading provider of software and technology solutions (“Microsoft”), for almost 20 years, retiring in January 2010. For the last 15 years at Microsoft, Mr. Kim was with Microsoft’s Interactive Entertainment Business division, most recently as its Corporate Vice President of Strategy and Business Development. Before that, Mr. Kim was the Corporate Vice President of Microsoft Game Studios, where he oversaw a team of approximately 1,000 programmers, designers, artists and producers developing a broad range of Xbox 360 and Windows titles. Since retiring from Microsoft in January 2010, Mr. Kim has been an independent adviser to companies in the interactive entertainment and digital media industries.
Director Qualifications: Mr. Kim brings to the Board over 20 years of experience in the constantly evolving video game industry and the associated rapidly changing technological landscape. His broad video game knowledge, his knowledge of Microsoft (one of our largest suppliers) and business experience bring valuable insight in supporting the advancement of the Company’s business and digital strategies.
Steven R. Koonin is a director and has served as a director since June 2007. Mr. Koonin is a member of the Nominating and Corporate Governance Committee. Mr. Koonin is the Chief Executive Officer of the National Basketball Association's Atlanta Hawks, a professional basketball team, a position he has held since April of 2014. He formerly served as the President of Turner Entertainment Networks, a media conglomerate, which includes Turner Network Television ("TNT"), Turner Broadcasting System ("TBS"), truTV and Turner Classic Movies ("Turner"). Mr. Koonin joined TBS in 2000 and was promoted to President of Turner in 2006. Mr. Koonin was responsible for the rebranding of TNT and TBS and for the development of some of the most successful programming in cable television history. He also led the rebrand of Court TV as truTV. Prior to joining Turner, Mr. Koonin spent 14 years with The Coca-Cola Company, a beverage company (“Coca-Cola”), including serving as Vice President of Consumer Marketing. In addition to leading the Atlanta Hawks organization, Mr. Koonin is extremely active in the Atlanta community and serves on the boards of directors of the Georgia Aquarium, the Fox Theatre, the Atlanta Symphony Orchestra and Emory Healthcare.
 Director Qualifications: Mr. Koonin brings to the Board 15 years of executive leadership experience with a leading provider of media entertainment and 15 years of experience with a globally-recognized consumer brand. Through his executive leadership experience at both Turner and Coca-Cola, he brings to the Board deep knowledge of the entertainment industry and content creation and delivery, as well as consumer branding strategy and tactics and insight into promoting growth strategies for consumer businesses.
Stephanie M. Shern is a director and Chair of the Audit Committee and has served in these capacities since 2002. From 1995 until 2001, Mrs. Shern was the Vice Chair and Global Director of Retail and Consumer Products for Ernst & Young LLP, a professional services organization (“Ernst & Young”), and a member of Ernst & Young’s Management Committee. Mrs. Shern became a Partner at Ernst & Young in 1981 and was with that firm for over 30 years. Mrs. Shern is currently a director of Koninklijke Ahold N.V. (“Royal Ahold”), where she serves as Chair of the Audit Committee and is a member of the Remuneration Committee and she is also a member of the Board of Directors and Audit Committee of Abercrombie & Fitch. During the past five years, Mrs. Shern has served as a director of CenturyLink Inc. and Scotts Miracle Gro. Mrs. Shern is a Certified Public Accountant ("CPA") and a member of the American Institute of CPAs and the New York State Society of CPAs. She is also a member of Pennsylvania State University’s Smeal College Accounting Advisory Board and a founding member of Tapestry Network’s Lead Director Network.
Director Qualifications: Mrs. Shern brings to the Board vast leadership, financial, international, marketing/consumer industry and retail experience from a nearly 40-year finance career focused significantly on retail and consumer industries in both the United States and abroad. In addition, as a current member of the Audit Committees of Royal Ahold (where she serves as Chair) and Abercrombie & Fitch and as a past member of Audit Committees of the boards of directors of other public companies, Mrs. Shern has extensive financial experience. This experience has proven valuable to the Board, where Mrs. Shern serves as Chair of the Audit Committee and as the “audit committee financial expert,” as that term is defined in the applicable rules and regulations of the SEC.
Gerald R. Szczepanski is a director and has served as a director for the Company and its predecessor companies since 2002. Mr. Szczepanski is Chair of the Compensation Committee. Mr. Szczepanski is currently retired. Mr. Szczepanski was the co-founder, and, from 1994 to 2005, the Chairman and Chief Executive Officer of Gadzooks, Inc., a publicly traded specialty retailer of casual clothing and accessories for teenagers.
Director Qualifications: Mr. Szczepanski brings to the Board over 35 years of experience in the retail business. He has extensive leadership experience as both a former chairman and chief executive officer of a public company in the specialty retail industry.


8


Kathy P. Vrabeck is a director and a member of the Audit Committee. She has served as a director since June 2012. She is a Senior Client Partner in the Los Angeles office of Korn Ferry, a global people and organizational advisory firm, where she is a member of Korn Ferry's Digital Practice, working closely with consumer and technology clients. Prior to joining Korn Ferry in October 2015, she was a Partner at Heidrick & Struggles International, Inc., an executive search firm ("Heidrick & Struggles"), where she served as both Global Sector Leader of their Media, Entertainment and Digital practice and partner-in-charge of the Los Angeles office. Prior to joining Heidrick & Struggles in July 2011, Ms. Vrabeck was with Legendary Pictures, a media company, from March 2009 to March 2011 where she served as President, Legendary Digital and was responsible for the creation, management and delivery of digital entertainment, with a focus on video games, across current and next-generation platforms. From May 2007 to November 2008, Ms. Vrabeck was with Electronic Arts, Inc., a developer, marketer, publisher and distributor of video games ("EA"), where she served as President, EA Casual Entertainment and led EA's efforts in the fastest growing segments of the video game market: mobile, online, social networking and global media sales. Prior to joining EA, Ms. Vrabeck was with Activision, Inc., a video game publisher ("Activision"), from August 1999 to April 2006 where she served as President, Activision Publishing, overseeing Activision's product development and global brand management and publishing operations. Earlier in her career, Ms. Vrabeck held various marketing, sales and finance positions with ConAgra, The Pillsbury Company, Quaker Oats and Eli Lilly and Company. Ms. Vrabeck currently serves on the DePauw University Board of Trustees.
Director Qualifications: Ms. Vrabeck brings to the Board over 10 years of experience in senior executive leadership positions with major game and film makers. Her digital entertainment knowledge, her knowledge of two of the Company's largest suppliers and her business experience bring valuable insight in supporting the advancement of our business and digital strategies.
Lawrence S. Zilavy is a director and a member of the Audit Committee and the Nominating and Corporate Governance Committee. Mr. Zilavy is also our lead independent director. He has served as a director since October 2005. Since October 2009, Mr. Zilavy has been employed by a private family investment office. Mr. Zilavy was a Senior Vice President of Barnes & Noble College Booksellers, Inc., a college book retailer, from May 2006 to September 2009. He was Executive Vice President, Corporate Finance and Strategic Planning for Barnes & Noble, Inc., a bookseller and retailer of content, digital media and education products (“Barnes & Noble”), from May 2003 until November 2004 and was Chief Financial Officer of Barnes & Noble from June 2002 through April 2003. Prior to joining Barnes & Noble, Mr. Zilavy had a 25-year career in banking. Mr. Zilavy serves on the Board of Directors of The Hain Celestial Group, Inc., a natural and organic food and personal care products company, where he is a member of the Audit Committee and chairperson of the Corporate Governance and Nominating Committee. Mr. Zilavy is also a director of the non-profit arts education institution The Harlem School of the Arts. Mr. Zilavy also served as a director of Barnes & Noble from 2006 to 2010.
Director Qualifications: Mr. Zilavy brings to the Board significant senior executive-level experience in a large specialty retail company and experience on public company boards. This experience, together with Mr. Zilavy’s 25 years of experience as a banker, provides the Board strong financial, operating and governance expertise.

THE BOARD RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE ELECTION OF EACH NOMINEE FOR DIRECTOR NAMED ABOVE. PROXIES SOLICITED BY THIS PROXY STATEMENT WILL BE VOTED FOR EACH NOMINEE NAMED ABOVE UNLESS A VOTE AGAINST A NOMINEE OR AN ABSTENTION IS SPECIFICALLY INDICATED.


9




Meetings and Committees of the Board
The Board met 12 times during fiscal 2015. All directors attended at least 75% of all of the meetings of the Board and the committees thereof on which they served during fiscal 2015.
The Board has three standing committees: an Audit Committee, a Compensation Committee, and a Nominating and Corporate Governance Committee.
Audit Committee
The Audit Committee assists the Board in fulfilling its oversight responsibility and reviews:
the adequacy and integrity of the Company’s financial statements and its financial reporting process and internal system of accounting controls;
the appointment, termination, compensation, retention and oversight of the independent registered public accountants;
the scope of the audit performed by the independent registered public accounting firm of the books and records of the Company;
the internal audit function and plan;
the Company’s compliance with legal and regulatory requirements;
the Company’s Code of Business Conduct and Ethics; and
with management and the independent auditor any related party transactions and approves such transactions if any.
In addition, the Audit Committee has established procedures for the receipt, retention and treatment of confidential and anonymous complaints regarding the Company’s accounting, internal accounting controls and auditing matters. The Board has adopted a written charter setting out the functions of the Audit Committee (the “Audit Committee Charter”), a copy of which is available on the Company’s website at http://investor.gamestop.com and is available in print to any stockholder who requests it in writing to the Company’s Secretary, GameStop Corp., 625 Westport Parkway, Grapevine, Texas 76051. As required by the Audit Committee Charter, the Audit Committee will continue to review and reassess the adequacy of the Audit Committee Charter annually and recommend any changes to the Board for approval.
The current members of the Audit Committee are Stephanie M. Shern (Chair), Kathy P. Vrabeck and Lawrence S. Zilavy, all of whom are “independent” directors under the listing standards of the NYSE. In addition to meeting the independence standards of the NYSE, each member of the Audit Committee is financially literate and meets the independence standards established by the SEC. The Board has also determined that Mrs. Shern has the requisite attributes of an “audit committee financial expert” as defined by regulations promulgated by the SEC and that such attributes were acquired through relevant education and/or experience. The Audit Committee met 10 times during fiscal 2015.
Compensation Committee
The Compensation Committee is primarily responsible for:
annually reviewing and approving corporate goals and objectives relevant to the Executive Chairman and the Chief Executive Officer compensation, evaluating the Executive Chairman’s and the Chief Executive Officer’s performance and, either as a committee or together with the other independent directors of the Company (as directed by the Board), determining and approving the Executive Chairman’s and Chief Executive Officer’s compensation level based on this evaluation;
working together with the Executive Chairman and Chief Executive Officer, annually reviewing and approving, for the Named Executive Officers and other executive officers, the annual base salary level, the annual incentive opportunity level, the long-term incentive opportunity level, employment agreements, severance arrangements, and change of control agreements/provisions, in each case as, when and if appropriate, and any special or supplemental benefits;
working together with the Executive Chairman and Chief Executive Officer, annually reviewing and making recommendations to the Board with respect to the compensation programs and policies applicable to the Company’s officers and directors, including incentive-compensation plans, equity-based plans and severance and retirement plans;
engaging executive compensation advisers, if desired, to assist the Compensation Committee in discharging its duties;
administering our GameStop Corp. Amended and Restated 2011 Incentive Plan (the “2011 Incentive Plan”) and our Fourth Amended and Restated 2001 Incentive Plan (the “2001 Incentive Plan”); and
producing an annual report on executive compensation for inclusion in the Company’s proxy statement.

10


The current members of the Compensation Committee are Gerald R. Szczepanski (Chair), Shane S. Kim and Thomas N. Kelly Jr., all of whom meet the independence standards of the NYSE and the SEC. The Board has adopted a written charter setting out the functions of the Compensation Committee, a copy of which is available on the Company’s website at http://investor.gamestop.com and is available in print to any stockholder who requests it in writing to the Company’s Secretary, GameStop Corp., 625 Westport Parkway, Grapevine, Texas 76051. The Compensation Committee met eight times during fiscal 2015.
Nominating and Corporate Governance Committee
The Nominating and Corporate Governance Committee is primarily responsible for:
reviewing and recommending to the Board candidates for service on the Board and its committees, including the nomination of existing directors;
periodically reviewing and making recommendations to the Board regarding the size and composition of the Board and its committees;
annually reviewing the independence of the directors;
overseeing the Company’s orientation process for newly elected directors and regularly assessing the adequacy of and need for additional director continuing education programs;
overseeing the annual performance evaluation of the Board and its committees and management; and
periodically reviewing and recommending changes to the Company’s Corporate Governance Guidelines.
The current members of the Nominating and Corporate Governance Committee are Jerome L. Davis (Chair), Steven R. Koonin and Lawrence S. Zilavy, all of whom meet the independence standards of the NYSE. The Board has adopted a written charter setting out the functions of the Nominating and Corporate Governance Committee, a copy of which can be found on our website at http://investor.gamestop.com and is available in print to any stockholder who requests it in writing to the Company’s Secretary, GameStop Corp., 625 Westport Parkway, Grapevine, Texas 76051. The Nominating and Corporate Governance Committee met four times during fiscal 2015.
Minimum Qualifications
The Nominating and Corporate Governance Committee does not set specific minimum qualifications for directors except to the extent required to meet applicable legal, regulatory and stock exchange requirements, including, but not limited to, the independence requirements of the NYSE and the SEC, as applicable. Nominees for director are selected on the basis of outstanding achievement in their personal careers; board experience; wisdom; integrity; diversity; ability to make independent, analytical inquiries; understanding of the business environment; and willingness to devote adequate time to Board duties. The Nominating and Corporate Governance Committee and the Board believe that Board membership should reflect diversity in its broadest sense, including diversity of skills, background, gender and ethnicity. While the selection of qualified directors is a complex and subjective process that requires consideration of many intangible factors, the Nominating and Corporate Governance Committee believes that each director should have a basic understanding of (i) the principal operational and financial objectives and plans and strategies of the Company, (ii) the results of operations and financial condition of the Company and of any of its significant subsidiaries or business segments, and (iii) the relative standing of the Company and its business segments in relation to their competitors.
Nominating Process
Consideration of new Board nominee candidates, if any, typically involves a series of internal discussions, review of information concerning candidates and interviews with selected candidates. The Nominating and Corporate Governance Committee is willing to consider candidates submitted by a variety of sources (including incumbent directors, stockholders (in accordance with the process described below), Company management and third-party search firms) when reviewing candidates to fill vacancies and/or expand the Board. When nominating a sitting director for re-election at an annual meeting, the Nominating and Corporate Governance Committee considers the director’s performance on the Board and its committees and the director’s qualifications in respect of the foregoing.
Consideration of Stockholder-Nominated Directors
Stockholders have the right to submit nominations for persons to be elected to the Board as described below. If such a nomination occurs and if a vacancy arises or if the Board decides to expand its membership, and at such other times as the Board deems necessary or appropriate, or as required by applicable law, the Nominating and Corporate Governance Committee will consider potential nominees submitted by stockholders. The Company’s Bylaws provide that, in order for a stockholder to nominate a person for election to the Board at an annual meeting of stockholders, such stockholder must give written notice to the Company’s Secretary, GameStop Corp., 625 Westport Parkway, Grapevine, Texas 76051, not less than 30 days nor more than 60 days prior to the annual meeting; provided, however, that in the event that less than 40 days’ notice or prior public disclosure of the date of the annual meeting is given to stockholders, notice by the stockholder must be given not later than the close of business on the 10th day following the day on which such notice of the date of the annual meeting was mailed or such public disclosure was made. Such notice must contain the proposing stockholder’s record name and address, and the number of shares of the Company that are beneficially owned by such stockholder. Such notice must also contain

11


all information relating to such nominee that is required to be disclosed in solicitations of proxies for election of directors, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including such person’s written consent to being a nominee and to serving as a director if elected as well as a supporting statement describing the nominee’s reasons for seeking election. The Nominating and Corporate Governance Committee has not adopted any criteria for evaluating a candidate for nomination to the Board that differ depending on whether the candidate is nominated by a stockholder as opposed to being nominated by an incumbent director, Company management, third-party search firm or other source.

Corporate Governance
Codes of Ethics
The Company has adopted a Code of Ethics for Senior Financial and Executive Officers that is applicable to the Company’s Executive Chairman, Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, Chief Accounting Officer, and any Executive Vice President of the Company or Vice President of the Company employed in a finance or accounting role. The Company also has adopted a Code of Standards, Ethics and Conduct applicable to all of the Company’s management-level employees and non-employee directors. The Code of Ethics for Senior Financial and Executive Officers and the Code of Standards, Ethics and Conduct are available on the Company’s website at http://investor.gamestop.com and are available in print to any stockholder who requests them in writing to the Company’s Secretary, GameStop Corp., 625 Westport Parkway, Grapevine, Texas 76051. In accordance with SEC rules, the Company intends to disclose any amendment (other than any technical, administrative or other non-substantive amendment) to either of the above Codes, or any waiver of any provision thereof with respect to certain specified officers listed above, on the Company’s website at http://investor.gamestop.com within four business days following such amendment or waiver.
 
Claw-back Policy
The Company has adopted a claw-back policy which requires the Board, when permitted by law, to require reimbursement of annual incentive payments or long-term incentive payments from a current or former executive officer of the Company where the payment was predicated upon achieving certain financial results or other operating metrics, and either (1) the Board determines in its good faith judgment that such financial results or other operating metrics were achieved in whole or part as a result of fraud or other misconduct on the part of such executive, or fraud or other misconduct of other employees of the Company of which such executive had knowledge, whether or not such conduct results in any restatement of Company financial statements filed with the SEC, or (2) such financial results or other operating metrics were the subject of a restatement of Company financial statements filed with the SEC, and a lower payment would have been made to the executive officer based upon the restated financial results. The Company will, to the fullest extent possible under applicable law, seek to recover from the individual executive officer, in the case of (1), the full amount of the individual executive officer’s incentive payments for the relevant period (including, at a minimum, for the three-year period prior to such financial results), and in the case of (2), the amount by which the individual executive officer’s incentive payments for the relevant period (including, at a minimum, for the three-year period prior to the restatement of financial results) exceeded the lower payment that would have been made based on the restated financial results.
Equity Ownership Policy
The Board believes that it is important for each executive officer and non-employee director of the Company to have a financial stake in the Company to help align the executive officer’s and non-employee director’s interests with those of the Company’s stockholders. To that end, the Company has an equity ownership policy requiring that each executive officer and non-employee director of the Company maintain ownership of common stock with a value of at least the following:
Executive Officer or Non-employee Director 
 
Fiscal 2015 Stock Ownership Guideline
Executive Chairman
 
5 times base salary
Chief Executive Officer
 
5 times base salary
Chief Operating Officer or Executive Vice President
 
3 times base salary
Non-employee Director
 
$275,000
New executive officers or non-employee directors of the Company will be given a period of five (5) years to attain full compliance with these requirements. These requirements will be reduced by 50% for executive officers after the executive officer reaches the age of 62 in order to facilitate appropriate financial planning. For a director who retires after reaching age 72 or ceases to serve after at least 10 years of Board service to the Company, with the consent of the Compensation Committee, all awards granted to such director fully vest upon termination of Board service.
For purposes of these determinations, (i) stock ownership includes shares of common stock which are directly owned or owned by family members residing with the executive officer or non-employee director, or by family trusts, as well as vested options and vested restricted stock, and unvested restricted stock or equivalents, unless they are subject to achievement of performance targets, and common stock or stock equivalents credited to such executive officer or non-employee director under any deferred compensation plan, and (ii) common stock shall be valued per share using the 200-day trailing average NYSE per share closing price.

12


As of January 30, 2016, each of our executive officers and non-employee directors was in compliance with our equity ownership policy.
Anti-Hedging Policy
Given that the aim of ownership of common stock is to ensure that employees and directors of the Company have a direct personal financial stake in the Company’s performance, hedging transactions on the part of employees and directors of the Company could be contrary to that purpose. Therefore, the Company has adopted an anti-hedging policy which states that the implementation by an employee or director of the Company of hedging strategies or transactions using short sales, puts, calls or other types of financial instruments (including, but not limited to, prepaid variable forward contracts, equity swaps, collars, and exchange funds) based upon the value of common stock and applied to equity securities granted to such employee or director, or held, directly or indirectly, by such employee or director, is strictly prohibited.
Corporate Governance Guidelines; Certifications
The Board has adopted Corporate Governance Guidelines. The Corporate Governance Guidelines are available on the Company’s website at http://investor.gamestop.com and are available in print to any stockholder who requests them in writing to the Company’s Secretary, GameStop Corp., 625 Westport Parkway, Grapevine, Texas 76051.
On an annual basis, our Chief Executive Officer submits to the NYSE the annual certification required by Section 303A.12(a) of the NYSE Listed Company Manual. In addition, the Company has filed with the SEC as exhibits to its Annual Report on Form 10-K, as amended, for the fiscal year ended January 30, 2016, the certifications of its Chief Executive Officer and Chief Financial Officer required pursuant to Section 302 of the Sarbanes-Oxley Act relating to the quality of its public disclosure.
Communications Between Stockholders and Interested Parties and the Board
Stockholders and other interested persons seeking to communicate with the Board should submit any communications in writing to the Company’s Secretary, GameStop Corp., 625 Westport Parkway, Grapevine, Texas 76051. Any such communication must state the number of shares beneficially owned by the stockholder making the communication. The Company’s Secretary will forward such communication to the full Board or to any individual director or directors (including the presiding director of the executive sessions of the non-management directors or the non-management directors as a group) to whom the communication is directed.
Attendance at Annual Meetings
All members of the Board are expected to attend in person the Company’s 2016 annual meeting and be available to address questions or concerns raised by stockholders. All of the Company’s 11 directors attended the Company's 2015 annual meeting.
Director Independence; Independence Determination
The Board has adopted the definition of independence in the listing standards of the NYSE. In its assessment of director independence, the Board considers all commercial, charitable and other relationships and transactions that any director or member of his immediate family may have with us, with any of our affiliates or with any of our consultants or advisers.
The Board has affirmatively determined that each of Jerome L. Davis, R. Richard Fontaine, Thomas N. Kelly Jr., Shane S. Kim, Steven R. Koonin, Stephanie M. Shern, Gerald R. Szczepanski, Kathy P. Vrabeck and Lawrence S. Zilavy is independent under the NYSE standards as well as under standards set forth in SEC regulations, and that the Audit Committee, Nominating and Corporate Governance Committee and Compensation Committee are comprised exclusively of independent directors under the foregoing standards. The Board did not determine Messrs. Raines and DeMatteo to be independent because of their current or former executive positions with the Company. The Board’s determination of Mr. Fontaine’s independence took into account the passage of time (in excess of three years) since his tenure as an executive with us ended.
The non-management directors of the Company hold regularly scheduled executive sessions without management present at least once annually and the independent directors hold at least one meeting annually with only independent directors present. Our lead independent director, Mr. Zilavy, is the presiding director for each non-management or independent director executive session.
Board Leadership Structure
The Board’s current leadership structure is comprised of an Executive Chairman position that is separate from the Chief Executive Officer position, as well as 10 other directors of which nine are independent, including a lead independent director. Under the Board’s current structure, Mr. DeMatteo is the Executive Chairman and is also a member of management and former Chief Executive Officer of the Company. The Board believes that Mr. DeMatteo’s in-depth knowledge of our business and its challenges, as well as his experience in the video game industry as a whole, make him the best qualified person to serve as Executive Chairman. In addition, this structure facilitates better communication between management and the Board and allows Mr. DeMatteo to more effectively oversee the execution of our strategic initiatives, including the implementation of the Company’s multi-concept retail strategy and provide guidance to the senior management team, including our Chief Executive Officer. Mr. J. Paul Raines, the Chief Executive Officer of the Company, also serves as a director. The Board believes that Mr. Raines’ service as a director further enhances the Board’s oversight of our day-to-day operations and provides additional management expertise with respect to the complexities of our business units, including the existing

13


video game store base, international operations, mobile and digital initiatives and our diversification into other retail concepts, including AT&T and Cricket branded wireless stores and Simply Mac branded Apple reseller stores. The Board believes that at this time our stockholders are best served by this structure as it helps facilitate the Company’s continuing transformation to a multi-concept retailer. All directors play an active role in overseeing the Company’s business both at the Board and committee level. For additional oversight, our lead independent director presides over regularly scheduled meetings with the other non-management directors to discuss and evaluate the Company’s business without members of management present. This structure, together with our other corporate governance practices, provides strong independent oversight of management while ensuring clear strategic direction for the Company.
Risk Oversight
Responsibility for risk oversight resides with the full Board. Committees have been established to help the Board carry out this responsibility by focusing on key areas of risk inherent in the business. The Audit Committee oversees risk associated with financial and accounting matters, including compliance with legal and regulatory requirements, related-party transactions and the Company’s financial reporting and internal control systems. The Audit Committee also oversees the Company’s internal audit function and regularly meets separately with the Company’s head of internal audit, general counsel, external auditors and other financial and executive management. The Compensation Committee oversees risks associated with compensation policies and the retention and development of executive talent, including the development of policies that do not encourage excessive risk-taking by our executives. These policies include various factors to help mitigate risk, including fixed compensation components and variable components that include mitigating factors such as a consistent structure across all business units, generally involving consolidated income components; targeted award amounts that are not significant as a percentage of revenue; and vesting periods, equity ownership policies, and claw-back provisions. The Compensation Committee and management also regularly review the Company’s compensation policies to determine effectiveness and to assess the risk they present to the Company. Based on this review, the Company has concluded that its compensation policies and procedures are not reasonably likely to have a material adverse effect on the Company. In addition, at least annually, the Board conducts a formal business review including a risk assessment related to the Company’s existing business and new initiatives. Because overseeing risk is an ongoing process and inherent in the Company’s strategic decisions, the Board also discusses risk throughout the year at other meetings in relation to specific topics or actions.


14


Director Compensation
In fiscal 2015, total compensation for each non-employee director was set at $280,000, which consisted of a $140,000 cash retainer and a restricted stock grant valued at approximately $140,000 which vests after one year. In prior years, long-term cash awards were also granted; however, this practice was eliminated during the year ended January 31, 2015 (“fiscal 2014”). For the year ended January 28, 2017 (“fiscal 2016”), the compensation structure for each non-employee director will remain consistent with the fiscal 2015 director compensation structure. We reimburse our directors for expenses in connection with attendance at Board and committee meetings. Other than with respect to reimbursement of expenses, directors who are our employees do not receive additional compensation for their services as directors and none of the directors receive additional compensation for their services as committee chairpersons or as our lead independent director.
Additionally, because the Board believes that it is important for each director of the Company to have a financial stake in the Company to help align the director’s interests with those of the Company’s stockholders, we require our directors maintain a certain level of ownership of common stock. For a description of the equity ownership policy, see "Corporate Governance-Equity Ownership Policy" above.
The following table provides information regarding compensation earned by our non-employee directors during fiscal 2015:
Name
 
Fees Earned and
Paid in Cash (1)
 
Stock
Awards (2)
 
 
All Other
Compensation (3)
 
Total
Jerome L. Davis(4)
 
$
140,000

 
$
140,000

 
 
$
75,000

 
$
355,000

R. Richard Fontaine(4)
 
140,000

 
140,000

 
 
75,000

 
355,000

Thomas N. Kelly Jr.(4)
 
140,000

 
140,000

 
 
75,000

 
355,000

Shane S. Kim(4)
 
140,000

 
140,000

 
 
75,000

 
355,000

Steven R. Koonin(4)
 
140,000

 
140,000

 
 
75,000

 
355,000

Stephanie M. Shern(4)
 
140,000

 
140,000

 
 
37,500

 
317,500

Gerald R. Szczepanski(4)
 
140,000

 
140,000

 
 
37,500

 
317,500

Kathy P. Vrabeck(4)
 
140,000

 
140,000

 
 
75,000

 
355,000

Lawrence S. Zilavy(4)
 
140,000

 
140,000

 
 
75,000

 
355,000


(1)
Represents amounts earned and paid for service in fiscal 2015.
(2)
Reflects the grant date fair values in accordance with FASB ASC Topic 718 for the fiscal 2015 grants of 3,156 shares of restricted stock for each of the Board members based on the closing price of our common stock on the date of grant. Grants of restricted shares vest after one year following the grant date, subject to continued service to the Company as well as accelerated vesting in the case of retirement under certain circumstances. The assumptions used by the Company in calculating the grant date fair value are incorporated herein by reference to Note 14 to the Company’s consolidated financial statements in its Form 10-K, as amended, filed March 29, 2016.
(3)
Reflects long-term cash awards granted in fiscal 2013 and fiscal 2012. The awards vest in equal annual increments over a three-year period after the grant date, subject to continued service to the Company; awards may accelerate vesting in the case of retirement under certain circumstances. The amounts reflected represent the amount of the awards vested during fiscal 2015. No long-term cash awards were granted in fiscal 2015 or fiscal 2014.
(4)
As of January 30, 2016, each of the named directors held 4,676 shares of restricted stock that have not vested.

15



Executive Officers
The following table sets forth the names and ages of our executive officers and the positions they hold:
Name 
 
Age
 
Position with the Company
Daniel A. DeMatteo
 
68
 
Executive Chairman
J. Paul Raines
 
52
 
Chief Executive Officer
Tony D. Bartel
 
52
 
Chief Operating Officer
Robert A. Lloyd
 
54
 
Executive Vice President and Chief Financial Officer
Michael K. Mauler
 
55
 
Executive Vice President and President, GameStop International
Michael P. Hogan
 
57
 
Executive Vice President, Strategic Business and Brand Development
Michael T. Buskey
 
67
 
Executive Vice President and President, U.S. Stores
Troy W. Crawford
 
48
 
Senior Vice President, Chief Accounting Officer
In this Proxy Statement, the term “Named Executive Officers” means our Chief Executive Officer (our Principal Executive Officer, or "PEO"), our Executive Vice President and Chief Financial Officer (our Principal Financial Officer, or "PFO"), and our Executive Chairman, Chief Operating Officer and Executive Vice President and President, GameStop International, who were our three most highly compensated executives other than our PEO and PFO in fiscal 2015.
Roles of Executive Chairman and Chief Executive Officer
The Company employs an Executive Chairman (Mr. DeMatteo) and a Chief Executive Officer (Mr. Raines). As Executive Chairman, Mr. DeMatteo is responsible for the leadership and coordination of the activities of the Board, for overseeing the strategic direction of the Company and for providing guidance to the Company’s Chief Executive Officer and other executives. As Chief Executive Officer, Mr. Raines has responsibility for development and execution of our strategic plans and for leadership and oversight of all of the Company’s day-to-day operations and performance.
Business Experience of Executive Officers
Information with respect to executive officers of the Company who are also directors or nominees for director is set forth in “Information Concerning the Directors and Nominees” above.
Tony D. Bartel is Chief Operating Officer of GameStop, a role he has held since January 2015. He served as President from 2010 to January 2015 and Executive Vice President of Merchandising and Marketing from 2007 to 2010. Prior to that, Mr. Bartel was the Senior Vice President of International Finance, a role he held since joining GameStop in 2005. Mr. Bartel joined GameStop from NCH Corporation, a major marketer of maintenance products, where he was the Chief Administrative Officer from 2003 to 2005. From 1989 to 2003, Mr. Bartel held various positions with PepsiCo, a beverage company, and Yum! Brands, Inc., an American fast food company, including Operational Finance, Strategic Planning, Controller and eventually Chief Financial Officer of Pizza Hut. Prior to 1989, Mr. Bartel held various positions with the public accounting firm of KPMG Peat Marwick. Mr. Bartel currently serves on the Board of Directors of Sonic Corp.
 Robert A. Lloyd is Executive Vice President and Chief Financial Officer, a role he has held since 2010. Mr. Lloyd also served as our Chief Accounting Officer, a position he held from 2005 to 2010. Prior to that, Mr. Lloyd was the Vice President - Finance of GameStop or its predecessor companies from 2000 and was the Controller of GameStop’s predecessor companies from 1996 to 2000. From 1988 to December 1996, Mr. Lloyd held various financial management positions as Controller or Chief Financial Officer, primarily in the telecommunications industry. Prior to 1988, Mr. Lloyd held various positions with the public accounting firm of Ernst & Young. Mr. Lloyd is a CPA. Mr. Lloyd currently serves on the Board of Directors of the Make-A-Wish Foundation of North Texas, a non-profit organization.
Michael K. Mauler is Executive Vice President and President of GameStop International, a role he has held since 2010. Mr. Mauler was formerly the Company’s Senior Vice President of Supply Chain and International Support, a position he held since 2005. Prior to that, Mr. Mauler was the Vice President of Logistics of Electronics Boutique, a computer video games retailer. Mr. Mauler has also held senior management positions for Baxter Healthcare, a health care company, Dade Behring, a company which manufactured testing machinery and supplies for the medical diagnostics industry, and Fisher Scientific, a multinational, biotechnology product development company, where he led operations for 22 countries.
Michael P. Hogan is the Executive Vice President of Strategic Business and Brand Development, a role he has held since August 2012. He joined GameStop in 2008 as Senior Vice President and Chief Marketing Officer, in which capacity he served until August 2012. Previously, Mr. Hogan served as a Principal with Strategic Frameworking, a strategic consulting firm. Mr. Hogan also served as a Senior Vice President of Marketing at Dean Foods Company, a food and beverage company, and as Vice President of International Marketing at Frito-Lay. Mr. Hogan currently serves on the Board of Directors of Feed the Children, a non-profit organization.

16


Michael T. Buskey is the Executive Vice President and President of U.S. Stores, a role he has held since January 2015. He joined GameStop in 2010 as Senior Vice President of Human Resources. Previously, Mr. Buskey served as Senior Vice President of Human Resources and U.S. Store Operations for Home Depot. Mr. Buskey has more than 30 years of retail leadership experience in human resources and store operations.
Troy W. Crawford is the Senior Vice President and Chief Accounting Officer, a role he has held since June 2010. He joined GameStop in 2006 as Vice President-Controller. From 1993 to 2006, Mr. Crawford held various financial management positions including Controller at CompUSA, a consumer electronics retailer. Prior to 1993 he held various finance and accounting positions with Cinemark USA, Inc., a motion picture exhibition company. Mr. Crawford is a CPA.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The following table sets forth the number of shares of our common stock (including common stock that may be purchased pursuant to the exercise of options, warrants or otherwise within 60 days of April 29, 2016) beneficially owned on April 29, 2016 by each Director, each of the Named Executive Officers, each holder of 5% or more of our common stock and all of our directors and executive officers as a group. Except as otherwise noted, the individual director or executive officer or his or her family members had sole voting and investment power with respect to the identified securities. Except as otherwise noted, the address of each person listed below is GameStop Corp., 625 Westport Parkway, Grapevine, Texas 76051. The total number of shares of our common stock outstanding as of April 29, 2016 was 103,951,952.
 
 
Shares Beneficially Owned
Name
 
Number (1)
 
%
FMR LLC
 
15,700,286

(2) 
15.1
245 Summer Street
 
 
 
 
Boston, MA 02210
 
 
 
 
The Vanguard Group
 
10,201,922

(3) 
9.8
100 Vanguard Boulevard
 
 
 
 
Malvern, PA 19355
 
 
 
 
AllianceBernstein L.P.
 
7,999,403

(4) 
7.7
1345 Avenue of the Americas
 
 
 
 
New York, NY 10105
 
 
 
 
American International Group, Inc.
 
7,981,966

(5) 
7.7
175 Water Street
 
 
 
 
New York, NY 10038
 
 
 
 
BlackRock, Inc.
 
6,241,267

(6) 
6.0
55 East 52nd Street
 
 
 
 
New York, NY 10055
 
 
 
 
J. Paul Raines
 
768,479

(7) 
*
Robert A. Lloyd
 
209,514

(8) 
*
Daniel A. DeMatteo
 
379,378

(9) 
*
Tony D. Bartel
 
485,511

(10) 
*
Michael K. Mauler
 
147,350

(11) 
*
Jerome L. Davis
 
39,286

(12) 
*
R. Richard Fontaine
 
233,534

(12) 
*
Thomas N. Kelly Jr.
 
18,330

(12) 
*
Shane S. Kim
 
20,356

(12) 
*
Steven R. Koonin
 
13,076

(12) 
*
Stephanie M. Shern
 
9,507

(12) 
*
Gerald R. Szczepanski
 
28,936

(12) 
*
Kathy P. Vrabeck
 
12,736

(12) 
*
Lawrence S. Zilavy
 
18,996

(12) 
*
All Directors and Officers as a group (17 persons)
 
2,767,206

(13) 
2.7

*
Less than 1.0%.

17


(1)
Shares of common stock that an individual or group has a right to acquire within 60 days after April 29, 2016 pursuant to the exercise of options, warrants or other rights are deemed to be outstanding for the purpose of computing the beneficial ownership of shares and percentage of such individual or group, but are not deemed to be outstanding for the purpose of computing the beneficial ownership of shares and percentage of any other person or group shown in the table.
(2)
Based on information included in its Amendment No. 6 to Schedule 13G filed with the SEC on February 12, 2016, FMR LLC has the sole power to vote or to direct the vote with respect to 2,161,069 of these shares and sole power to dispose or direct the disposition with respect to 15,700,286 of these shares.
(3)
Based on information included in its Amendment No. 4 to Schedule 13G filed with the SEC on February 10, 2016, The Vanguard Group has the sole power to vote or to direct the vote with respect to 196,245 of these shares, the sole power to dispose or direct the disposition with respect to 9,995,408 of these shares and the shared power to vote or direct to vote with respect to 9,800 of these shares and the shared power to dispose or direct the disposition with respect to 206,514 of these shares.
(4)
Based on information included in its Amendment No. 1 to Schedule 13G filed with the SEC on February 16, 2016, AllianceBernstein L.P. has the sole power to vote or to direct the vote with respect to 7,061,422 of these shares, the sole power to dispose or direct the disposition with respect to 7,995,486 of these shares and the shared power to dispose or direct the disposition with respect to 3,917 of these shares.
(5)
Based on information included in its Amendment No. 1 to Schedule 13G filed with the SEC on February 11, 2016, American International Group, Inc. has the shared power to vote or to direct the vote with respect to 7,981,966 of these shares and the shared power to dispose or direct the disposition with respect to 7,981,966 of these shares. The holdings by American International Group, Inc. disclosed in such Schedule 13G include the following holdings by its affiliates:
SAFG Retirement Services, Inc. has the shared power to vote or to direct the vote with respect to 7,981,966 of these shares and the shared power to dispose or direct the disposition with respect to 7,981,966 of these shares.
AIG Life Holdings, Inc. has the shared power to vote or to direct the vote with respect to 7,981,966 of these shares and the shared power to dispose or direct the disposition with respect to 7,981,966 of these shares.
AGC Life Insurance Company has the shared power to vote or to direct the vote with respect to 7,981,966 of these shares and the shared power to dispose or direct the disposition with respect to 7,981,966 of these shares.
American General Life Insurance Company has the shared power to vote or to direct the vote with respect to 7,789,533 of these shares and the shared power to dispose or direct the disposition with respect to 7,789,533 of these shares.
SunAmerica Asset Management, LLC has the shared power to vote or to direct the vote with respect to 7,789,533 of these shares and the shared power to dispose or direct the disposition with respect to 7,789,533 of these shares.
(6)
Based on information included in its Amendment No. 8 to Schedule 13G filed with the SEC on January 22, 2016, BlackRock, Inc. has the sole power to vote or to direct the vote with respect to 5,264,440 of these shares and sole power to dispose or direct the disposition with respect to 6,241,267 of these shares.
(7)
Of these shares, 208,050 are issuable upon exercise of stock options (all of which are vested as of April 29, 2016) and 303,367 are unvested restricted shares.
(8)
Of these shares, 42,340 are issuable upon exercise of stock options (all of which are vested as of April 29, 2016) and 102,023 are unvested restricted shares.
(9)
Of these shares, 121,630 are issuable upon exercise of stock options (all of which are vested as of April 29, 2016) and 104,452 are unvested restricted shares.
(10)
Of these shares, 116,730 are issuable upon exercise of stock options (all of which are vested as of April 29, 2016) and 145,680 are unvested restricted shares.
(11)
Of these shares, 30,250 are issuable upon exercise of stock options (all of which are vested as of April 29, 2016) and 72,895 are unvested restricted shares.
(12)
Of these shares, 3,156 are unvested restricted shares.
(13)
Of these shares, 577,390 are issuable upon exercise of stock options (all of which are vested as of the record date), 907,876 are unvested restricted shares and 5,200 shares are held in each of two trusts for the benefit of the children of one of our Executive Officers.

Compensation Committee Interlocks and Insider Participation
The members of the Compensation Committee are Gerald R. Szczepanski (Chair), Thomas N. Kelly Jr. and Shane S. Kim, none of whom has ever been an employee of the Company. No member of the Compensation Committee had a relationship requiring disclosure in this Proxy Statement under Items 404 or 407 of SEC Regulation S-K.



18



ADVISORY VOTE ON EXECUTIVE COMPENSATION
PROPOSAL 2
We believe that it is appropriate to solicit the views of our stockholders regarding the compensation of our Named Executive Officers. Accordingly, and in accordance with SEC rules implemented under Section 14A of the Exchange Act, the Company seeks a non-binding advisory vote from our stockholders on the compensation of our Named Executive Officers as described in this Proxy Statement.
As discussed more fully in the “Compensation Discussion and Analysis” in this Proxy Statement, the Compensation Committee believes the Company’s Named Executive Officers should be compensated commensurate with their success in maintaining the growth and high level of performance necessary for the Company to produce ongoing and sustained value for our stockholders. The Company’s executive officer compensation program is based on the following guiding principles:
1.
Total compensation provided by the Company to its Named Executive Officers should be competitive and allow the Company to attract and retain individuals whose skills are critical to the long-term success of the Company.
2.
The compensation offered by the Company should reward and motivate individual and team performance in attaining business objectives and maximizing stockholder value, while avoiding the encouragement of unnecessary or excessive risk-taking.
3.
Compensation awards should be based on the fundamental principle of aligning the long-term interests of GameStop’s employees with those of GameStop’s stockholders. Therefore, a meaningful portion of most management employees’ compensation will be in the form of long-term equity compensation. All of the short-term incentives, in the form of annual cash bonuses, and a large portion of equity compensation for Named Executive Officers, are tied to performance measures, and may include situational bonuses, as appropriate, in recognition of meeting unique, time-sensitive performance challenges that may arise.
4.
The overall value of the incentive and total compensation opportunities are designed to be consistent with the level of the Company’s operational performance over time and the level of returns provided to stockholders.
In response to the advisory vote on the frequency of the advisory vote on executive compensation at our 2011 annual meeting, we provide this advisory vote on executive compensation on an annual basis. This is an advisory vote and is not binding upon the Company, the Compensation Committee or the Board. Therefore, stockholders are not ultimately voting for the approval or disapproval of the Board's recommendation on this proposal. The result of the vote will not impact any compensation that has already been paid or awarded to the executive officers. However, because we value the views of our stockholders, our Compensation Committee, which is responsible for, among other things, designing and administering the Company’s executive compensation program, will review and consider the results of this advisory vote when considering future decisions with respect to executive compensation.
We strongly encourage stockholders to read the “Compensation Discussion and Analysis,” the compensation tables and the accompanying narrative disclosures in this Proxy Statement which discuss in greater detail the compensation of our executive officers, the Company’s compensation philosophy and the factors that the Compensation Committee considered in making compensation decisions.
Accordingly, the Board recommends that stockholders vote FOR the following resolution:
“RESOLVED, that the Company’s stockholders approve, on an advisory basis, the compensation of the Named Executive Officers, as disclosed in the Company’s Proxy Statement for the 2016 annual meeting of stockholders pursuant to the compensation disclosure rules of the SEC, including the Compensation Discussion and Analysis, the 2015 Summary Compensation Table and the other related tables and disclosure.”
 
THE BOARD RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE APPROVAL, ON A NON-BINDING ADVISORY BASIS, OF THE RESOLUTION ON COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS. PROXIES SOLICITED BY THIS PROXY STATEMENT WILL BE VOTED FOR THE PROPOSAL ABOVE UNLESS A VOTE AGAINST THE PROPOSAL OR AN ABSTENTION IS SPECIFICALLY INDICATED.

19


COMPENSATION DISCUSSION AND ANALYSIS
Executive Summary
Introduction
The Compensation Committee believes that our senior executives should be compensated commensurate with their success in maintaining the growth, profitability, cash flow and high level of performance necessary for GameStop to produce ongoing and sustained value for our stockholders. During the past few years, we have transformed from the world’s largest specialty retailer of physical video game products into a family of retail brands selling many of the world’s most popular technologies and pop-culture products. Our vision is to continue to expand our business as a global family of specialty retail brands. Our mission is to continue to be the world’s largest omnichannel retailer of new and pre-owned and value video game products, to continue to grow sales of digital products, to expand the sales of collectible products through our video game stores and www.thinkgeek.com, to increase the number of our pop culture-themed stores and to strategically grow our Technology Brands segment to further diversify our revenue streams. The Compensation Committee will continue to develop and recommend compensation programs to support this mission and our efforts to expand our business as a global family of specialty retail brands. The Board will continue to have sole approval rights over the Compensation Committee’s recommendations.
Specific Named Executive Officers ("NEOs") covered in this Compensation Discussion and Analysis are:
J. Paul Raines - Chief Executive Officer
Robert A. Lloyd - Executive Vice President and Chief Financial Officer
Daniel A. DeMatteo - Executive Chairman
Tony D. Bartel - Chief Operating Officer
Michael K. Mauler - Executive Vice President and President, GameStop International
In response to stockholder input, in recent years, we made a number of enhancements to our executive compensation disclosures and our executive compensation program, including increasing the amount of each NEO’s total compensation package tied to performance measures. The Compensation Committee targets between 50% to 60% of each NEO’s total compensation to be tied to performance measures and such compensation is therefore at risk.
 
2015 Performance
In fiscal 2015, we delivered strong performance, including making substantial progress on our strategic initiatives to develop as a global multichannel retailer of one of the largest entertainment categories — video games, both digital and physical, as well as to expand our business into other retail concepts, which we refer to as Technology Brands. All of these factors were reflected in our executive compensation outcomes. Under the leadership of our executive management team, we completed the following initiatives in fiscal 2015 in support of our overall strategy:
captured the leading retail position in selling the next generation video game consoles and new video game titles introduced throughout the year, resulting in an increase in comparable store sales of 4.3% for fiscal 2015;
continued the growth of the Technology Brands business, from revenues of over $328 million in fiscal 2014 to $534 million in fiscal 2015;
grew digital receipts from $948 million in fiscal 2014 to over $1 billion in fiscal 2015, achieving growth of 11.2%;
grew collectibles sales by over 300% to $310 million in fiscal 2015 from $76 million in fiscal 2014; and
continued the growth of PowerUp Rewards and our other customer loyalty programs, expanding from 40 million members at the end of fiscal 2014 to over 46 million members by the end of fiscal 2015.
Additionally, under the effective leadership of our executive management team, we continued to demonstrate disciplined capital allocation, with the following accomplishments:
repurchased 5.2 million shares of common stock at an average price of $38.68 per share for a total of $202.0 million, bringing cumulative share repurchases since the inception of our share repurchase program in January 2010 to 74.2 million shares at an average price of $25.66 per share for a total of $1.9 billion;
paid quarterly dividends of $0.36 per share, or $1.44 annually, in fiscal 2015, which represents an increase of 9% annually in comparison to dividends of $1.32 per share paid in fiscal 2014;
more than doubled the store count of our Technology Brands business with Spring Mobile and Simply Mac completing acquisitions of additional AT&T resellers and an authorized Apple retailer, respectively, for total consideration of $141.5 million net of cash acquired in fiscal 2015; and

20


acquired ThinkGeek for $126.0 million, net of cash acquired, which expands our global omnichannel platform and enables us to broaden our product offering in the collectibles category, including standalone stores and deepen relationships with our existing customer base.
In February 2016, we continued to deliver on our commitment to return value and capital to stockholders by announcing an increase in the quarterly dividend by an additional 3% in March 2016 to $0.37 per share.
The following chart illustrates our total shareholder return (after considering our dividend payments) during fiscal 2015 and our cumulative three-year total shareholder return, each in comparison to the total shareholder return for the Standard & Poor's 500 (the "S&P 500") over the same time frames:
2015 Compensation Program Summary
In 2015, the three primary components of our NEOs’ total target direct compensation were salary, short-term incentive and long-term incentive, as described below:
Program
Description
Purpose
Salary
Fixed cash compensation
Reward for level of responsibility, experience and sustained individual performance.
Short-Term Incentive ("STI")(1)
Cash compensation based on the following performance measures:
75% based on Operating earnings
25% based on Technology Brands and other new retail concepts store growth
Reward for achievement against specific objective financial goals and strategic goals.
Long-Term Incentive ("LTI")(1)
50% of total LTI award granted in performance-based restricted stock based on Net income performance against performance targets set by the Compensation Committee.
Reward for achievement against specific objective financial goals and creation of stockholder value.
50% of total LTI award granted in time-based restricted stock subject to vesting based on continued service.
Reward for creation of stockholder value and to retain executives for the long-term.


(1)
Subject to a performance condition of $200 million in overall net income to be eligible for tax deductibility under Section 162(m). See “Section 162(m) Compliance” below for further detail.

21


Please refer to the "Other Considerations" section below for a discussion of other indirect elements of our compensation program.
A significant portion of the 2015 compensation program for our NEOs was performance-based, with payouts linked to the attainment of certain defined performance goals, including the Company's operating earnings, net income and Technology Brands and other new retail concepts store growth. The charts below summarize the mix of pay elements for the CEO, and all other NEOs, based on target compensation for fiscal 2015.
Incentive Plan Payouts for Performance Periods Ending Fiscal 2015
Performance awards may vest in a fiscal year other than the year of grant. Performance results for awards with a performance period measured as of the end of fiscal 2015, and the resulting payouts, are summarized in the table below:
Incentive Plan
 
Performance Period
 
Performance Achieved as a % of Target
 
Payout as a % of Target
STI
 
Fiscal 2015
 
Achieved 100.3% of the targeted operating earnings and 197.0% of the targeted Technology Brands and other new retail concepts store growth(1)
 
106.0% of the targeted award amount
LTI (Performance-based restricted stock)
 
Fiscal 2013-2015
 
Achieved 94.7% of the targeted return on invested capital(2)
 
85.0% of the targeted award amount

(1)
Related to the 2015 STI, with payout tied to percentage of annual salary and percentage attainment of operating earnings and Technology Brands and other new retail concepts store growth targets set by Compensation Committee. See “Short-Term Incentives” below for further detail. 2015 STI was also subject to a performance condition of $200 million in overall net income in fiscal 2015 for purposes of achieving tax deductibility under Section 162(m). See “Section 162(m) Compliance” below for further detail.
(2)
Related to the 2013 performance-based restricted stock grant subject to a three-year performance target tied to achieving a certain return on invested capital target, with such target measured following the completion of the three-year period ended January 30, 2016. See Long-Term Incentives section below for further detail.

Compensation Philosophy
Our executive officer compensation program is administered by the Compensation Committee of the Board. The program is based upon the following guiding principles:
Total compensation provided to our NEOs should be competitive and allow us to attract and retain individuals whose skills are critical to our long-term success;
The compensation we offer should reward and motivate individual and team performance in attaining business objectives and maximizing stockholder value, while avoiding the encouragement of unnecessary or excessive risk-taking;
Compensation awards should be based on the fundamental principle of aligning the long-term interests of our employees with those of our stockholders. Therefore, a meaningful portion of most management employees’ compensation will be in the form of long-term equity compensation. All of the short-term incentives, in the form of annual cash bonuses, and a significant portion of equity compensation for NEOs are tied to performance measures. Compensation may include situational bonuses, as appropriate, in recognition of meeting unique, time-sensitive performance challenges that may arise; and
 
The overall value of the incentive and total compensation opportunities will be designed to be consistent with the level of our operational performance over time and the level of returns provided to stockholders.

22


The compensation program is designed to reward the executive officers for the dedication of their time, efforts, skills and business experience to our operations. The Compensation Committee targets approximately 50% to 60% of each NEO's total compensation be tied to performance measures and such compensation is therefore at risk. The compensation program is also designed to reward both annual and long-term performance. Annual performance is rewarded through salary and short-term incentives and is measured by our operating earnings and growth, among other factors. Long-term performance is rewarded through performance-based and time-vested restricted stock, with approximately 50% of the total long-term incentive compensation mix tied to the achievement of performance measures.
The Compensation Committee oversees risks associated with compensation policies and the retention and development of executive talent, including the development of policies that do not encourage excessive risk-taking by our executives. These policies include various factors to help mitigate risk, including fixed compensation components and variable components that include mitigating factors such as a consistent structure across all business units, generally involving consolidated income components; targeted award amounts that are not significant as a percentage of revenue; and vesting periods, equity ownership policies, and claw-back provisions. The Compensation Committee and management also regularly review our compensation policies to determine effectiveness and to assess the risk they present to the Company. Based on this review, we have concluded that our compensation policies and procedures are not reasonably likely to have a material adverse effect on the Company.
Response to Advisory Vote on Executive Compensation
A substantial majority of our stockholders (98% of votes cast) approved the fiscal 2014 compensation for our NEOs at the 2015 annual meeting of stockholders. We interpreted these results, coupled with discussions that we have had from time to time with investors regarding compensation, as a validation of our executive compensation program. As a result, we have retained our general approach to executive compensation as described more fully in the "Key Elements of Compensation" section below. Nonetheless, the Compensation Committee continues to work with its independent consultant to consider alternatives and intends to make changes to the program where it determines it appropriate.
Compensation Determination Process
The Compensation Committee of the Board has the responsibility to develop compensation levels for the NEOs. In determining annual compensation levels for executive officers, the Compensation Committee, along with executive management, bases its decision on the individual’s performance and potential to improve stockholder value, the financial performance of the Company over the preceding fiscal year, projections for the Company's upcoming fiscal year, historical compensation for each NEO, the amount of shares available to be granted under our 2011 Incentive Plan and the results of reviews, surveys or other information from our compensation consultants.
The Compensation Committee considers the recommendations of the Executive Chairman and the Chief Executive Officer in determining compensation for the executive officers and employees other than the Executive Chairman and the Chief Executive Officer.
The Compensation Committee has the authority under its charter to retain a compensation consultant to assist in the evaluation of executive compensation, whose research and viewpoints provide one of several data points used by the Compensation Committee in developing specific recommendations to the Board. The Compensation Committee believes that such a consultant can play an essential role in the process of providing an impartial evaluation of compensation programs and practices, developing effective recommendations to the Board and evaluating the Company’s pay practices.
The Compensation Committee retains ClearBridge Compensation Group (“ClearBridge”) to advise on matters related to non-employee director and executive compensation. ClearBridge reports directly to the Compensation Committee and does not provide any other services to the Company. The Compensation Committee reviewed the independence of ClearBridge under SEC rules and NYSE listing standards regarding compensation consultants and has concluded that ClearBridge’s work for the Compensation Committee is independent and does not raise any conflicts of interest.
ClearBridge gathers benchmark data from our peer group, which the Compensation Committee considers among other factors (e.g., individual performance and potential, job responsibilities, historical compensation levels, etc.) in assessing and determining total compensation opportunities for the NEOs. Our selected peer group is generally comprised of specialty retailers which are approximately 0.5x to 2x the Company's revenue and 0.2x to 5x the Company's market capitalization. The specific companies included in our fiscal 2015 peer group are listed below:
Abercrombie & Fitch
Dick's Sporting Goods
Office Depot
Advance Auto Parts
Foot Locker
O'Reilly Automotive
AutoZone
Gap
PetSmart
Barnes & Noble
L Brands
Ross Stores
Bed Bath & Beyond
Nordstrom
Tiffany & Co
 

23


In general, not later than 90 days after the start of each fiscal year of the Company (and before 25% of the relevant performance period has elapsed), the Compensation Committee establishes in writing a performance target ("Target") for the annual short-term cash incentives and long-term performance-based restricted stock incentives. Targets are typically based on budgeted financials. Because the Target is established in the first 90 days of the fiscal year, the attainment of the Target is substantially uncertain at the time the Target is established.
For purposes of determining performance results against the pre-established Target and as provided for under the terms of the 2011 Incentive Plan, the Compensation Committee will make certain adjustments to actual performance results based on pre-determined adjustments, including amounts defined under accounting principles generally accepted in the United States of America (“GAAP”). The Compensation Committee provides for certain adjustments when it believes the adjusted results provide a performance measure that best represents actual performance results that are within the executives’ sphere of control and accountability. Actual performance results may be adjusted to eliminate the effects of, among other things, asset impairments and restructuring charges, acquisitions, debt retirement expenses, foreign currency changes, buybacks of the Company’s shares, and the impact to income taxes related to the difference in budgeted and actual income tax rates.
Key Elements of Compensation
The Company maintains employment agreements with each of the NEOs to cover the key elements of the Company’s executive compensation package, which consist of base salary and short-term and long-term incentive awards, and cover severance and termination benefits. These employment agreements and the Company’s policies with respect to each of the key elements of its executive compensation package are discussed below. In addition, while the elements of compensation described below are considered separately, the Compensation Committee also considers and reviews the full compensation package afforded by the Company to its executive officers, including insurance and other benefits. See below for details on the Company's 2015 compensation program.
Base Salaries
In determining the base salaries of the NEOs for fiscal 2015, the Compensation Committee considered, among other things, the Company's growth and continued expansion of our mobile, collectible and digital businesses in fiscal 2014, projections for fiscal 2015 and the responsibilities of each NEO, the individual's experience, the results of the benchmarking against the peer group, and the recommendations received from ClearBridge following its research. The base salary is intended to be competitive with base salaries paid to executive officers with comparable qualifications, experience and responsibilities at other companies of comparable size, growth and operations.
In March 2015, the Board set salaries for fiscal 2015 for the NEOs as follows:
Named Executive Officer
 
Base Salary
J. Paul Raines
 
$
1,250,000

Robert A. Lloyd
 
688,000

Daniel A. DeMatteo
 
550,000

Tony D. Bartel
 
900,000

Michael K. Mauler
 
574,000

Due to the ongoing evolution of Mr. DeMatteo's role as Executive Chairman, Mr. DeMatteo's base salary was reduced by $250,000, or 31%, from fiscal 2014 to fiscal 2015 to reflect the continued transition of responsibilities to Mr. Raines and Mr. Bartel. Other NEOs received salary increases of approximately 3%-5%.
Short-Term Incentives
In addition to a base salary, each NEO is eligible for a performance-based annual cash STI. The purpose of the STI is to motivate management to drive performance in the short-term.
Ultimately, STI payouts were determined based on the achievement of Operating Earnings and Technology Brands and other new retail concepts store growth, weighted 75% and 25% respectively. These metrics aligned with the Company’s business strategy of driving earnings and focusing on expanding the Technology Brands and other new retail concepts. The STI was also subject to a net earnings performance condition for purposes of achieving tax deductibility under Section 162(m). See “Section 162(m) Compliance” below for further detail.
The NEOs final STI payouts were ultimately based 75% on Operating Earnings and 25% on Technology Brand and other new retail concepts store growth. Payouts associated with each performance measure were based on the following scale. Straight-line interpolation is applied between levels shown.

24


If the Performance Period Results are:
 
Then the Percentage of the
Target Earned for Each Measure is:
125% or more of Target
 
125%
110%
 
110%
100% (Target)
 
100% (Target)
90%
 
75%
85%
 
50%
Less than 85% of Target
 
None

Participating executive officers are entitled to a STI in an amount equal to a percentage of their base salary which is pre-determined for each NEO by the Compensation Committee, with input from the Executive Chairman and Chief Executive Officer (other than for themselves), for each fiscal year.
Target STI opportunities for fiscal 2015 for our NEOs were as follows:  
Named Executive Officer
 
Percentage of
Base Salary
J. Paul Raines
 
200%
Robert A. Lloyd
 
100%
Daniel A. DeMatteo
 
150%
Tony D. Bartel
 
125%
Michael K. Mauler
 
100%
In determining the final STI payout, the Compensation Committee assessed operating earnings and Technology Brands and other new retail concepts store growth performance, as shown below.
Performance Measure
 
Target*
 
Actual*
 
Performance Achieved as a % of Target
 
STI Earned
 
Weighting Percentage of Overall Bonus
 
Payout as a % of Target
Operating Earnings (fiscal 2015)
 
$676 million
 
$678 million
 
100.3%
 
100.0%
 
75.0%
 
75%
Technology Brands and other new concepts store growth (fiscal 2015)
 
300 stores
 
591 stores
 
197.0%
 
125.0%
 
25.0%
 
31%
Total Payout
 
 
 
 
 
 
 
 
 
 
 
106%
* For purposes of determining performance results against a pre-established target, the Compensation Committee may make certain adjustments to actual performance results, including amounts defined under GAAP. The Compensation Committee provides for certain adjustments when it believes the adjustments provide a performance measure that best represents actual performance results that are within the executives’ sphere of control and accountability. Actual performance results may be adjusted to eliminate the effects of, among other things, asset impairments and restructuring charges, acquisitions, debt retirement expenses, foreign currency changes, buybacks of the Company’s shares, and the impact to income taxes related to the difference in budgeted and actual income tax rates.
The following STI payouts were made for fiscal 2015 to our NEOs:
Named Executive Officer
 
STI Payout
J. Paul Raines
 
$
2,650,000

Robert A. Lloyd
 
729,280

Daniel A. DeMatteo
 
874,500

Tony D. Bartel
 
1,192,500

Michael K. Mauler
 
608,440

Section 162(m) Compliance
In order to structure the STI as potentially deductible amounts under Section 162(m), the STI plan was subject to a performance condition of $200 million overall net income in fiscal 2015. This performance condition was met in fiscal 2015 and determined the maximum bonus pool from which the NEO’s STI payouts could be paid. The maximum bonus pool was established at 150% of the target payout opportunities for all NEOs indicated above. In awarding the final STI payouts to each NEO, the Compensation Committee exercised

25


its discretion to reduce the maximum amount available for each NEO under the pool. The basis for this exercise of negative discretion by the Compensation Committee was the Company’s performance against the net operating earnings and Technology Brands and other new retail concepts store growth targets as described above.
Long-Term Incentive Awards
The Compensation Committee met on March 2, 2015 and, upon ratification by the Board on March 3, 2015, granted a combination of time-vested restricted stock and performance-based restricted stock for fiscal 2015 to be granted to the NEOs as of March 6, 2015 (collectively, the “2015 LTI Awards”). Time-vested restricted stock and performance-based restricted stock were granted to align the interests of the NEOs with the interests of the Company’s stockholders, offer NEOs an incentive for the achievement of superior performance over time and foster the retention of key management personnel. The LTI award was comprised of 50% time-vested restricted stock and 50% performance-based restricted stock, which emphasizes the retentive and performance-based nature of the total LTI award. Equity awards are granted under the provisions of the 2011 Incentive Plan.
Time-vested restricted stock awards are subject to a three-year ratable vesting schedule and achieving net income of $200 million for fiscal 2015 to achieve tax deductibility under Section 162(m). The performance condition in fiscal 2015 was met.
Performance-based restricted stock are subject to performance against a pre-determined two-year net income goal, measured at the end of fiscal 2016. Net income was selected as a measure to focus on the long-term profitability of the Company. Additionally, given the Company is focused on diversifying its business, a two-year performance period was selected recognizing the difficulty in setting goals for a longer time period. Awards are subject to one additional year of time-based vesting following the end of the performance period to provide for additional retention of NEOs. Each NEO is entitled to receive the performance-based restricted stock according to the performance achievement scale shown below. Straight-line interpolation is applied between levels shown.
If the Performance Period Results are:
 
Then the Percentage of the
Target Award Received is:
115% or more of Target
 
150%
110%
 
125%
100% (Target)
 
100% (Target)
90%
 
75%
85%
 
50%
Less than 85% of Target
 
None

The target value of the 2015 LTI awards was determined based on the closing price of our common stock of $40.16 on of the grant date of March 6, 2015. To determine the amount of equity to grant to each NEO, the Compensation Committee considered, among other things, the Company’s overall performance, projections for the Company's upcoming fiscal year, each NEO’s individual contributions to the Company’s overall performance, including individual contributions toward achievement of strategic objectives, and comparisons of long-term incentives and total compensation of similar positions within the Company’s peer group.The Compensation Committee awarded the NEOs restricted stock in fiscal 2015 as follows:
Named Executive Officer
 
Time-Vested
Restricted Stock
Grant
(1)
 
Performance-
Based Restricted
Stock Grant -- Net Income
(2)
 
Total Shares of
Restricted
Stock
Awarded
 
Total Targeted
Award Value
(3)
J. Paul Raines
 
62,280

 
62,280

 
124,560

 
$
5,000,000

Robert A. Lloyd
 
20,940

 
20,940

 
41,880

 
1,680,000

Daniel A. DeMatteo
 
31,140

 
31,140

 
62,280

 
2,500,000

Tony D. Bartel
 
29,910

 
29,910

 
59,820

 
2,400,000

Michael K. Mauler
 
14,970

 
14,970

 
29,940

 
1,200,000

 

26



(1)
Restricted shares of common stock, subject to a performance condition intended to achieve tax deductibility under Section 162(m) of the Code. The award vests in equal installments on March 6th of each of the years 2016 through 2018, subject to continued service to the Company.
(2)
Performance-based restricted stock subject to two-year net income measured at the end of a two-year performance period ending fiscal 2016. Determination of earned awards subject to the completion of the audited consolidated financial statements for fiscal 2016. The earned shares will vest subject to continued service with the Company through March 6, 2018.
(3)
The fair value of stock-denominated awards is based the closing price of our common stock of $40.16 per share on the grant date of March 6, 2015.

The pay for performance scale and respective goals for the 2013 performance-based restricted stock tied to 3-year ROIC were as follows:
3-Year ROIC
 
Then the Percentage of the
Target Award Received is:
Performance as a % of Target
 
ROIC %
 
115% or more of Target
 
20.13%
 
150%
110%
 
19.25%
 
125%
100% (Target)
 
17.50%
 
100% (Target)
90%
 
15.75%
 
75%
85%
 
14.88%
 
50%
Less than 85% of Target
 
<14.88%
 
None
In determining the final payout, the Compensation Committee assessed ROIC, as shown below.
Performance Measure
 
Target*
 
Actual*
 
Performance Achieved as a % of Target
 
Performance-based Restricted Stock Earned
ROIC
 
17.5%
 
16.6%
 
94.7%
 
85%
Based on the actual results, the number of earned performance-based restricted stock by NEO is as follows:
Named Executive Officer
Number of Earned Performance-based Restricted Stock Payout
J. Paul Raines
 
34,272
Robert A. Lloyd
 
14,408
Daniel A. DeMatteo
 
21,420
Tony D. Bartel
 
20,553
Michael K. Mauler
 
10,277

2016 Compensation Program Summary
Provided below is a summary of key compensation decisions made in fiscal 2016.
Fiscal 2016 Salaries and STI Opportunities
In setting the base salaries of these executive officers for fiscal 2016, the Compensation Committee considered, among other things, the Company’s growth and continued expansion into the Technology Brands and collectibles businesses in fiscal 2015, projections for fiscal 2016 and the responsibilities of each NEO, the results of the benchmarking against the peer group, and the recommendations received from ClearBridge following its research.
For fiscal 2016, the Compensation Committee increased the base salary of Messrs. Raines, Lloyd, Bartel and Mauler by 3%. No change was made to the base salary of Mr. DeMatteo.
For fiscal 2016, the Compensation Committee recommended, and the Board approved, no change to the Target STI opportunity (as a percentage of base salary) for any NEO.

27


Salaries and Target STI payouts for fiscal 2016 for our NEOs are as follows: 
Named Executive Officer
 
Base Salary
 
Target STI Percentage of
Base Salary
J. Paul Raines
 
$
1,288,000

 
200%
Robert A. Lloyd
 
709,000

 
100%
Daniel A. DeMatteo
 
550,000

 
150%
Tony D. Bartel
 
927,000

 
125%
Michael K. Mauler
 
592,000

 
100%
2016 Long-Term Incentive Grants
The Compensation Committee met on February 22, 2016 and, upon ratification by the Board on February 23, 2016, approved a combination of time-vested and performance-based restricted stock for fiscal 2016 to be granted as of February 26, 2016 (collectively, the “2016 LTI Awards”). The target value of the 2016 LTI Awards was determined effective as of February 22, 2016, with the number of shares determined effective as of the grant date of February 26, 2016. The target value for each of Mssrs. Raines, Lloyd, Bartel and Mauler represents 90% of the targeted value of the 2015 LTI Awards in recognition of the Company's efforts to reduce Selling, General and Administrative costs. The target value for Mr. DeMatteo's 2016 LTI Award is set at $1,200,000, reflecting his continually evolving role as Executive Chairman. The LTI award was comprised of 50% time-vested restricted stock and 50% performance-based restricted stock, which emphasizes the retentive and performance-based nature of the total LTI award.
Time-vested restricted stock awards are subject to a three-year ratable vesting schedule and a performance condition based on net income in fiscal 2016 intended to achieve tax deductibility under Section 162(m). Performance-based restricted stock awards are subject to vesting both on the basis of continued service to the Company and the achievement of a certain operating earnings target and a certain operating earnings target for the amount of operating earnings coming from sources other than physical gaming for the fiscal year ended February 3, 2018 ("fiscal 2017"), with such targets to be measured following the completion of the two-year period ended fiscal 2017. Performance-based restricted stock awards are subject to one additional year of time-based vesting following the end of the performance period. The Compensation Committee awarded the NEOs restricted stock as follows:
Named Executive Officer
 
Time-Vested
Restricted Stock
Grant
(1)
 
Performance-Based Restricted Stock Grant - Net Income (2)
 
Total Shares of
Restricted
Stock
Awarded
 
Total Targeted
Award Value
(3)
J. Paul Raines
 
73,680

 
73,680

 
147,360

 
$
4,500,000

Robert A. Lloyd
 
24,780

 
24,780

 
49,560

 
1,512,000

Daniel A. DeMatteo
 
19,650

 
19,650

 
39,300

 
1,200,000

Tony D. Bartel
 
35,370

 
35,370

 
70,740

 
2,160,000

Michael K. Mauler
 
17,700

 
17,700

 
35,400

 
1,080,000

 
(1)
Restricted shares of common stock, subject to a performance condition intended to achieve tax deductibility under Section 162(m) of the Code. The award vests in equal installments on February 26th of each of the years 2017 through 2019, subject to continued service to the Company and subject to achieving a certain level of net income in fiscal 2016.
(2)
Performance-based restricted stock subject to two-year net income measured at the end of a two-year performance period ending fiscal 2017. Determination of earned awards subject to the completion of the audited consolidated financial statements for fiscal 2017. The earned shares will vest subject to continued service with the Company through February 3, 2019.
(3)
The fair value of stock-denominated awards is based on the closing price of our common stock of $30.54 per share on the grant date of February 26, 2016.

Adjustment to Prior Awards
In fiscal 2016 the Compensation Committee recommended and the Board approved an adjustment to the 2012 performance grant that was based on the Company's return on invested capital for fiscal 2014 after it was determined that each recipient was entitled to 5% more of the grant. The adjustment resulted in an additional distribution of 2,130 shares to Mr. Raines, 900 shares to Mr. Lloyd, 1,335 shares to Mr. DeMatteo, 1,275 shares to Mr. Bartel and 645 shares to Mr. Mauler.

28



 
Employment Agreements and Severance/Change in Control Benefits
The Company entered into new employment agreements with J. Paul Raines, Robert A. Lloyd, Daniel A. DeMatteo, Tony D. Bartel and Michael K. Mauler effective May 10, 2013, and on November 13, 2013, the Company further amended and restated its employment agreement with Mr. Raines (collectively, as amended, the "Employment Agreements"). The Employment Agreements replaced all prior employment agreements that we had previously entered into with such executive officers. In addition to certain changes with respect to the triggers for and the payment of severance, as described below, the Employment Agreements also differ from the prior agreements with these executives in that (A) the term of each of the Employment Agreements is "at will" and may be terminated by the Company or the executive at any time and (B) each executive is restricted from competing with GameStop for two years after termination of employment regardless of the reason for the termination.
Under the terms of the Employment Agreements, each executive shall be entitled to all benefits afforded to management personnel or as determined by the Board, including, but not limited to, insurance programs, vacation, sick leave and 401(k) benefits.
Pursuant to the Employment Agreements, each executive’s employment may terminate upon death or disability, by GameStop with or without cause (as defined) or by the executive within twelve months of a good reason event. If an executive’s employment is terminated due to death or disability, or by the Company with cause or by the executive without good reason, the executive is entitled to payment of base salary through the date of death, disability or termination of employment.
Cause includes any of the following: (i) conviction of, or plea of nolo contendere to, a felony or any crime involving fraud or dishonesty; (ii) willful misconduct, whether or not in the course of service, that results (or that, if publicized, would be reasonably likely to result) in material and demonstrable damage to the business or reputation of the Company; (iii) material breach by the executive of any agreement with, policy of or duty owed to the Company or any of its subsidiaries; or (iv) willful refusal by the executive to perform his duties to the Company or the lawful direction of his or her supervisor that is not the result of a disability. If a cause event set forth in subsection (iii) or (iv) occurs, the executive will have a 30-day period in which to cure the event if the Board determines that such event is capable of cure.
Good reason includes the following: (i) a material diminution in the executive’s base salary or the executive’s target annual bonus opportunity; (ii) a material diminution in the executive’s authority, duties, or responsibilities; (iii) the Company relocates the executive’s principal worksite outside of the Dallas/Ft. Worth metropolitan area; or (iv) in the event of a sale of substantially all the business and assets of the Company, a failure of the Company to assign, or a refusal of the principal purchaser of assets to assume, the Company’s then continuing obligations under the Employment Agreements. The Company generally has a 30-day period after notification by the executive to cure any good reason event.
Upon an executive’s termination of employment without cause or by the executive with good reason, the executive, subject to an effective release, would receive an amount equal to two times (A) the executive’s base salary plus (B) the executive’s target bonus. Such amount would be paid in a lump sum. If such termination occurred within 18 months following a change in control (as defined in the Employment Agreements) the “two” would be replaced by two and one-half (three in the case of the Chief Executive Officer and the Executive Chairman). The executive would also receive continuation of medical benefits for up to 18 months. Additionally, any time-based equity grants made to the executive would become fully vested. Any performance-based equity grants made to the executive will remain outstanding and will vest, if at all, based on actual performance through the end of the applicable performance period. Any options held by the executive will generally remain outstanding until the earlier of the original stated expiration date of the option or one year from the date of termination.
If the executive’s employment with the Company is terminated due to death or disability, then the same treatment with respect to equity would apply; provided that if the executive’s employment terminates due to death, all performance-based equity grants will vest and be paid at the target level. Any options held by the executive will generally remain outstanding until the earlier of the original stated expiration date of the option, one year from the date of termination or any accelerated expiration date of the options provided under the 2011 Incentive Plan, as amended, including upon a change of control.
The triggering events which would result in the payment of the severance amounts described above were selected because they provide employees with a guaranteed level of financial protection upon loss of employment and are considered competitive with severance provisions being offered currently in the market. The estimated minimum payments upon termination for each of the NEOs are detailed in "Potential Payments upon Termination or Change in Control" below.

29



Other Considerations
 
Stock Ownership
The Company has adopted a stock ownership policy which requires its NEOs and non-employee directors to be stockholders in the Company. The Compensation Committee believes that ownership of stock of the Company that is material to the income of the individuals involved is sufficient to provide the required incentive to such officers and non-employee directors and align their interests with the interests of the Company’s stockholders. For a description of the stock ownership policy, see “Equity Ownership Policy” above.
Claw-back of Awards
The Company has adopted a formal claw-back policy to recover past compensation awards from executive officers in the event of fraud or a restatement. For a description of the claw-back policy, see “Claw-back Policy” above. The Company has not historically had any restatements or adjustments of this nature.
Anti-Hedging
The Company has adopted a formal anti-hedging policy prohibiting its employees and non-employee directors from entering into any form of hedging strategies or transactions using short sales, puts, calls or other types of financial instruments to protect against a loss in value of common stock. For a description of the anti-hedging policy, see “Corporate Governance-Anti-Hedging Policy” above.
Retirement Policy
In February 2015, the retirement policy (the “Retirement Policy”), recommended by the Compensation Committee and approved by the Board in March 2014, became effective with respect to individuals, including any Named Executive Officer who meets the criteria described below, providing for vesting of certain awards granted under the 2011 Incentive Plan upon such employee’s retirement. Pursuant to the Retirement Policy, employees who attain a minimum age of 55 and a minimum period of service with the Company and its affiliates of 10 years and whose age plus service equals or exceeds 70, will, upon termination (other than a for cause termination) (an “Eligible Retirement”), become vested with respect to certain unvested awards granted under the 2011 Incentive Plan. Mr. DeMatteo is the only NEO currently eligible to retire and receive the vesting offered under the Retirement Policy. Additional details regarding the Retirement Policy are included in the "Employment Agreements and Potential Payments Upon Termination or Change in Control" section below.
Retirement Benefits
Each of the Company’s executive officers is entitled to participate in the Company’s defined contribution 401(k) plan on the same basis as all other eligible employees. The Company matches the contributions of participants, subject to certain criteria. Under the terms of the 401(k) plan, as prescribed by the Internal Revenue Service (“IRS”), the contribution of any participating employee is limited to a maximum percentage of annual pay or a maximum dollar amount ($18,000 for 2015). Our executive officers are subject to these limitations and therefore the Company does not consider its retirement benefits to be a material portion of the compensation program for our executive officers.
Dividends
Under the terms of the 2001 Incentive Plan and 2011 Incentive Plan and related award agreements, holders of unvested restricted stock are entitled to receive dividends on those shares of stock. Dividends on unvested shares are being accrued on behalf of the NEOs and will only be paid upon vesting of the underlying shares and to the extent the shares are earned (if subject to performance measures). Accordingly, our Named Executive Officers received dividends on certain of their unvested restricted shares of stock once the underlying shares vested in fiscal 2015.
Benefits and Perquisites
The Company maintains traditional health and welfare benefit plans and a qualified 401(k) plan, which are generally offered to all employees (subject to basic plan eligibility requirements) and are consistent with the types of benefits offered by other similar corporations. In addition to these traditional benefits, the Company offered in fiscal 2015 certain executive level perquisites to key executives, including all NEOs, which are designed to be competitive with the compensation practices of similar corporations, including life insurance and disability insurance commensurate with executive salaries, third party financial planning services and annual physical examinations. Messrs. Raines, Bartel, Lloyd and Mauler utilized the third party financial planning services in fiscal 2015.
In addition, Messrs. Raines, Lloyd, DeMatteo, Bartel and Mauler are eligible to use the Company plane for personal use. Mr. Raines used the plane for personal use during fiscal 2015 and fiscal 2014 but did not use the plane for personal use during fiscal 2013. Mr. DeMatteo used the plane for personal use in each of the fiscal years 2015, 2014 and 2013. Mr. Lloyd used the plane for personal

30


use in fiscal 2015, but did not use the plane for personal use in fiscal 2014 or fiscal 2013. Mr. Bartel and Mr. Mauler did not use the plane for personal use during fiscal 2015, fiscal 2014 or fiscal 2013.
The amounts disclosed in the “All Other Compensation” column of the Summary Compensation Table for the personal use of the Company plane represent actual incremental costs to operate the plane. The aggregate incremental cost is calculated based on the portion of the total variable operating costs for the fiscal year that was incurred as a result of personal use of the aircraft. These variable operating costs were provided by the third party retained to pilot and maintain the Company plane and include the following:
fuel;
crew expenses;
ground services;
aircraft telecommunication;
catering & aircraft supplies;
aircraft parts & supplies;
maintenance labor & expenses;
aircraft cleaning;
international fees; and
navigation and weather services.
The variable operating costs are divided by the total nautical miles flown by the Company plane during the year to arrive at a variable cost per nautical mile. This cost per nautical mile is then multiplied by the number of nautical miles incurred for personal use to arrive at the aggregate incremental cost attributable to the NEO. Additionally, while it happens rarely, if an aircraft flies empty before picking up or after dropping off a passenger flying for personal reasons, this "deadhead" segment would be included in the calculation of aggregate incremental cost.
Our Named Executive Officers are fully responsible for the personal income tax liability associated with their perquisites, including the use of the Company plane for personal reasons. The Company does not provide a tax gross-up with respect to such imputed income. None of the Named Executive Officers receives any other compensation or benefits which would be defined as perquisites.
Tax and Accounting Implications
Impact of Section 162(m) of the Internal Revenue Code
The Compensation Committee has considered the potential impact of Section 162(m) of the Code, adopted under the Revenue Reconciliation Act of 1993. This section disallows a tax deduction for any publicly held corporation, for individual compensation exceeding $1,000,000 in any taxable year paid to its chief executive officer or any of its three other most highly-compensated officers unless (i) the compensation is payable solely on account of the attainment of performance goals, (ii) the performance goals are determined by a committee of two or more outside directors, (iii) the material terms under which compensation is to be paid are disclosed to and approved by stockholders and (iv) the determining committee certifies that the performance goals were met. Because it is in the best interests of the Company to qualify to the maximum extent possible the compensation of its executives for deductibility under applicable tax laws, the Company obtained stockholder approval for the 2011 Incentive Plan, which provides for the payment of compensation in compliance with the above guidelines. The 2011 Incentive Plan was amended and restated at the 2013 annual meeting of stockholders to increase the maximum amount of cash bonus payable under the Plan to $6,000,000.
However, the Compensation Committee retains the ability to exercise discretion and to retain flexibility in the payment of compensation that may outweigh the advantages of qualifying all compensation as exempt from the limit of Section 162(m) of the Code.
Accounting for Stock-Based Compensation
The Company records share-based compensation expense in earnings based on the grant-date fair value of options or restricted stock granted in accordance with Financial Accounting Standards Board Accounting Standards Codification 718, Compensation–Stock Compensation (“ASC 718”).

31



 
Executive Compensation
The following table (the “Summary Compensation Table”) sets forth the compensation earned during the fiscal years indicated by our PEO, our PFO and our three other most highly compensated executive officers.
Summary Compensation Table
Name and Principal
Position
 
Year
(1)
 
Salary
(2)
 
Special Cash Bonus
(3)
 
Stock
Awards
(4)
 
Option
Awards
(4)
 
Non-Equity
Incentive Plan
Compensation
(5)
 
Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
(6)
 
All Other
Compensation
(7)
 
Total
J. Paul Raines
 
2015
 
$
1,246,923

 
$

 
$
5,002,330

 
$

 
$
2,650,000

 
$

 
$
240,644

 
$
9,139,897

Chief Executive Officer
 
2014
 
1,201,346

 

 
3,751,078

 
1,250,236

 
2,057,000

 

 
344,916

 
8,604,576

 
2013
 
1,059,423

 
975,000

 
3,002,227

 
998,757

 
2,120,000

 

 
193,692

 
8,349,099

Robert A. Lloyd
 
2015
 
685,462

 

 
1,681,901

 

 
729,280

 

 
59,583

 
3,156,226

Executive Vice President and Chief Financial Officer
 
2014
 
653,904

 

 
1,261,915

 
420,085

 
556,750

 

 
121,046

 
3,013,700

 
2013
 
635,308

 
409,500

 
1,262,097

 
419,610

 
636,000

 

 
112,920

 
3,475,435

Daniel A. DeMatteo
 
2015
 
556,731

 

 
2,501,165

 

 
874,500

 

 
72,244

 
4,004,640

Executive Chairman
 
2014
 
821,865

 

 
1,875,539

 
625,304

 
1,147,500

 

 
184,802

 
4,655,010

 
2013
 
900,000

 
877,500

 
1,876,392

 
624,303

 
1,350,000

 

 
147,580

 
5,775,775

Tony D. Bartel
 
2015
 
896,538

 

 
2,402,371

 

 
1,192,500

 

 
45,463

 
4,536,872

Chief Operating Officer
 
2014
 
853,558

 

 
1,802,736

 
600,069

 
726,750

 

 
143,820

 
4,126,933

 
2013
 
829,566

 
585,000

 
1,800,443

 
599,169

 
830,000

 

 
140,234

 
4,784,412

Michael K. Mauler
 
2015
 
571,846

 

 
1,202,390

 

 
608,440

 

 
50,878

 
2,433,554

Executive Vice President and President, GameStop International
 
2014
 
545,077

 

 
901,368

 
300,220

 
464,100

 

 
95,625

 
2,306,390

 
2013
(8) 

 

 

 

 

 

 

 


(1)
Reflects fiscal 2015, fiscal 2014 and fiscal 2013.
(2)
Reflects salary paid for fiscal 2015 which consisted of 52 weeks, fiscal 2014, which consisted of 52 weeks, and fiscal 2013, which consisted of 52 weeks.
(3)
Reflects cash bonuses awarded along with the fiscal 2011 grant of restricted stock awards. The amounts reflected represent the amount of the bonuses charged to selling, general and administrative expenses in the Company’s consolidated statements of operations in accordance with GAAP related to the cash value of the cash bonuses that were awarded simultaneously with the grants of restricted stock awards. Each recipient of a cash bonus award received the right to an amount of cash consideration that was fixed on the award date and vested ratably over a three-year service period. The Company recognized the associated expense on a straight-line basis over the three-year period in which the services were performed.
(4)
Reflects the grant date fair value for the designated fiscal years for the restricted stock awards in accordance with ASC 718 based on the common stock price (or in the case of the stock options, the estimated Black-Scholes fair value) on the date of grant. A portion of the restricted shares granted will vest in equal annual increments over a three-year period after the grant date, subject to continued service to the Company. The remaining restricted shares granted are subject to certain performance measures and will vest, if at all, based on the achievement of such measures at the end of each respective performance period, subject to confirmation by the Compensation Committee and continued service to the Company. The assumptions we used to calculate the grant date fair values of the option awards and stock awards are incorporated herein by reference to Note 14 to the consolidated financial statements included in our Annual Report on Form 10-K, as amended, filed March 29, 2016.
(5)
For fiscal 2015, reflects incentive-based bonuses earned in fiscal 2015 but paid in April 2016.For fiscal 2014, reflects incentive-based bonuses earned in fiscal 2014 but paid in April 2015. For fiscal 2013, reflects incentive-based bonuses earned in fiscal 2013 but paid in April 2014.
(6)
None of the Company’s Named Executive Officers participate in the Company’s nonqualified deferred compensation plan.
(7)
The amounts reported in the "All Other Compensation" column represent the sum of (a) the aggregate incremental cost to us of all perquisites and other personal benefits, including the personal use of the Company plane, premiums on life insurance and long-term disability insurance, third party financial planning services and annual physical examinations, (b) the amounts contributed by us to our 401(k) retirement savings plan and (c) the dollar value of dividends on unvested restricted shares. See details of these amounts in the "All Other Compensation" table below.     
(8)
Mr. Mauler was not a Named Executive Officer in fiscal 2013.    

32


The following table provides information regarding the amounts reported in the "All Other Compensation" column of the Summary Compensation Table above for fiscal 2015:
All Other Compensation
Name
 
Personal Use of Company Aircraft & Ground Transportation (1)
 
401(k)
 
Life Insurance
 
Long-term Disability
 
Financial Services
 
Total
($)
J. Paul Raines
 
$
193,787

 
$
8,862

 
$
8,943

 
$
14,797

 
$
14,255

 
$
240,644

Robert A. Lloyd
 
7,563

 
9,920

 
7,545

 
20,300

 
14,255

 
59,583

Daniel A. DeMatteo
 
8,322

 
9,369

 

 
54,553

 

 
72,244

Tony D. Bartel
 

 
9,423

 
6,998

 
14,787

 
14,255

 
45,463

Michael K. Mauler
 

 
10,035

 
6,288

 
20,300

 
14,255

 
50,878


(1)
Personal use of Company aircraft is valued based on the aggregate incremental costs to the Company to operate the aircraft. As described more fully in the "Other Considerations" section above, the aggregate incremental cost is calculated based on the portion of the total variable operating costs for the fiscal year that was incurred as a result of personal use of the aircraft. The use of the Company airplane by Mr. Raines was as a result of Mr. Raines' medical condition and is the Compensation Committee's preferred means of travel for Mr. Raines. Our Named Executive Officers are fully responsible for the personal income tax liability associated with their perquisites. The Company does not provide a tax gross-up with respect to such imputed income.

Grants of Plan-Based Awards in Last Fiscal Year
The following table shows all grants of plan-based awards, which consisted of grants of time-vested stock options, time-vested and performance-based restricted shares of our common stock and grants of annual performance-based bonuses under the 2011 Incentive Plan, as amended, granted to the Named Executive Officers for fiscal 2015. The grant of share-based awards on March 6, 2015 was based on the performance of the Named Executive Officers for fiscal 2014.
Grants of Plan-Based Awards in Fiscal 2015
 
 
 
 
Estimated Future Payouts
Under Non-Equity Incentive Plan
Awards (1)
 
Estimated Future Payouts
Under Equity Incentive
Plan Awards (3)
 
All Other
Stock
Awards:
Number
of
Shares of
Stock or
Units
(#)(4)
 
All
Other
Option
Awards:
Number
of
Securities
Underlying
Options
(#)
 
Exercise or
Base Price
of
Option
Awards
($)(5)
 
Grant
Date
Fair Value
of Stock
and
Option
Awards
($)(5)
Name
 
Grant
Date
 
Thresh-
old
($)(2)
 
Target
($)
 
Maximum
($)
 
Thresh-
old
(#)(2)
 
Target
(#)
 
Maximum
(#)
 
 
 
 
J. Paul Raines
 
3/6/2015
 
$
1,250,000

 
$
2,500,000

 
$
3,125,000

 
31,140

 
62,280

 
93,420

 
62,280

 

 
$
40.16

 
$
5,002,330

Robert A. Lloyd
 
3/6/2015
 
344,000

 
688,000

 
860,000

 
10,470

 
20,940

 
31,410

 
20,940

 

 
40.16

 
1,681,901

Daniel A.  DeMatteo
 
3/6/2015
 
412,500

 
825,000

 
1,031,250

 
15,570

 
31,140

 
46,710

 
31,140

 

 
40.16

 
2,501,165

Tony D. Bartel
 
3/6/2015
 
562,500

 
1,125,000

 
1,406,250

 
14,955

 
29,910

 
44,865

 
29,910

 

 
40.16

 
2,402,371

Michael K. Mauler
 
3/6/2015
 
287,000

 
574,000

 
717,500

 
7,485

 
14,970

 
22,455

 
14,970

 

 
40.16

 
1,202,390


(1)
Non-Equity Incentive Plan Awards were granted under the 2011 Incentive Plan, as amended.
(2)
If at least 85% of target is achieved.
(3)
Equity Incentive Plan Awards were granted under the 2011 Incentive Plan and consist of the portion of the fiscal 2015 long-term incentive grant related to restricted shares of common stock subject to achievement of performance targets. For additional information on the grant, refer to the discussion under “Long-term Incentive Awards” in the Compensation Discussion and Analysis above.
(4)
Other Stock Awards were granted under the 2011 Incentive Plan and consist of the portion of the fiscal 2015 long-term incentive grant related to restricted shares of common stock subject to continued service to the Company. For additional information on the grant, refer to the discussion under “Long-term Incentive Awards” in the Compensation Discussion and Analysis above.
(5)
The grant date fair value of each equity award was computed in accordance with ASC 718 based on the closing price of common stock on the grant date. For the restricted stock subject to performance measures, the grant date fair value was determined based on the vesting of 100% of the restricted shares, which was the performance threshold the Company believed to be the probable outcome to be achieved under the grants as of the date of the grant.


33


Outstanding Equity Awards at Fiscal Year-End
The following table provides information for the executive officers named in the Summary Compensation Table regarding outstanding equity awards held as of January 30, 2016 by those executive officers. The year-end values in the table for the market value of shares that have not vested have been calculated based on the $26.21 per share closing price of common stock on January 29, 2016 (the last trading date of the fiscal year).
Outstanding Equity Awards at End of Fiscal 2015
 
 
 
 
Option Awards
 
Stock Awards
Name
 
Grant Date
 
Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable(1)
 
Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable(1)
 
Option
Exercise
Price ($)
 
Option
Expiration
Date (1)
 
Number of
Shares or
Units of
Stock That
Have Not
Vested (#)(2)
 
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested ($)(2)
 
Equity
Incentive
Plan  Awards:
Number of
Unearned
Shares,
Units or Other
Rights
That Have
Not Vested(#)(3)
 
Equity Incentive
Plan Awards:
Market or
Payout
Value of
Unearned
Shares,
Units or Other
Rights That
Have
Not Vested ($)(3)
J. Paul Raines
 
3/6/15
 

 

 
$

 

 
62,280

 
$
1,632,359

 
62,280

 
$
1,632,359

 
 
3/7/14
 
33,690

 
67,380

 
38.52

 
3/6/2024

 
39,493

 
1,035,111

 
32,460

 
850,777

 
 
2/22/13
 
93,780

 
46,890

 
24.82

 
2/21/2023

 
27,216

 
713,331

 
40,320

 
1,056,787

Robert A. Lloyd
 
3/6/15
 

 

 

 

 
20,940

 
548,837

 
20,940

 
548,837

 
 
3/7/14
 
11,320

 
22,640

 
38.52

 
3/6/2024

 
13,286

 
348,226

 
10,920

 
286,213

 
 
2/22/13
 

 
19,700

 
24.82

 
2/21/2023

 
11,442

 
299,895

 
16,950

 
444,260

Daniel A. DeMatteo
 
3/6/15
 

 

 

 

 
18,076

 
473,772

 
31,140

 
816,179

 
 
3/7/14
 
16,850

 
33,700

 
38.52

 
3/6/2024

 
11,462

 
300,419

 
16,230

 
425,388

 
 
2/22/13
 
58,620

 
29,310

 
24.82

 
2/21/2023

 
9,972

 
261,366

 
25,200

 
660,492

Tony D. Bartel
 
3/6/15
 

 

 

 

 
29,910

 
783,941

 
29,910

 
783,941

 
 
3/7/14
 
16,170

 
32,340

 
38.52

 
3/6/2024

 
18,980

 
497,466

 
15,600

 
408,876

 
 
2/22/13
 
56,260

 
28,130

 
24.82

 
2/21/2023

 
16,322

 
427,800

 
24,180

 
633,758

Michael K. Mauler
 
3/6/15
 

 

 

 

 
14,970

 
392,364

 
14,970

 
392,364

 
 
3/7/14
 
8,090

 
16,180

 
38.52

 
3/6/2024

 
9,490

 
248,733

 
7,800

 
204,438

 
 
2/22/13
 

 
14,070

 
24.82

 
2/21/2023

 
8,161

 
213,900

 
12,090

 
316,879


(1)
The options reflected herein were granted under the 2011 Incentive Plan, and vest and become exercisable in equal annual increments over a three-year period following the grant date. The options expire one day before the tenth anniversary of the grant date.
(2)
Represents unvested restricted shares outstanding as of January 30, 2016 which will vest based upon continued service to the Company. The shares outstanding as of the end of fiscal 2015 are comprised of time-vested grants of restricted shares which were made on February 22, 2013, March 7, 2014, and March 6, 2015. Also included in this column is the earned portion of performance-based restricted shares which were granted on February 22, 2013 and March 7, 2014 for which the respective performance periods are now complete. Pursuant to the Retirement Policy, Mr. DeMatteo’s shares will be released upon the earlier of the original vesting date or Mr. DeMatteo’s retirement.
(3)
Represents unvested restricted shares outstanding as of January 30, 2016 which will be earned, if at all, based upon the achievement of certain performance targets as well as continued service to the Company. All of the performance-based restricted shares granted in fiscal 2015 were tied to our net income over a two-year period and will vest, to the extent earned, on March 6, 2018, which represents the end of the three-year vesting period, subject to continued service to the Company. Approximately half of the performance-based restricted shares granted in fiscal 2014 were tied to our return on invested capital over a three-year period and will vest, to the extent earned, on March 7, 2017, which represents the end of the three-year performance period, subject to continued service to the Company. The remaining one-half of the performance-based restricted shares granted in fiscal 2014 were tied to earnings per share for fiscal 2014 and will vest in equal installments over a three-year period following the grant date, subject to continued service to the Company. The awards tied to earnings per share for fiscal 2014 were earned at 82.5% of the target following the close of fiscal 2014. The shares granted in fiscal 2013 are subject to a performance target tied to the Company's return on invested capital over a three-year period, and will vest, to the extent earned, on February 22, 2016, which represents the end of the three-year performance period, subject to continued service to the Company. The unvested restricted awards are entitled to quarterly dividends of the amount declared by the Board. The dividends on the restricted shares subject to performance measures will be accrued and paid to the recipients only if and when the shares vest.
 



34


Option Exercises and Stock Vested
The following table provides information for the executive officers named in the Summary Compensation Table regarding exercises of options to purchase shares of common stock and shares acquired upon vesting of stock awards during fiscal 2015 by those executive officers. The values realized upon vesting in the table have been calculated using the stock price at the time of vesting.
Fiscal 2015 Option Exercises and Stock Vested
 
 
Option Awards
 
Stock Awards
Name
 
Number of
Shares
Acquired on
Exercise (#)
 
Value Realized
On Exercise
($)(1)
 
Number of
Shares
Acquired on
Vesting (#)
 
Value Realized
On Vesting
($)(2)
J. Paul Raines
 

 
$

 
125,063

 
$
4,697,930

Robert A. Lloyd
 
39,400

 
675,568

 
51,085

 
1,916,472

Daniel A. DeMatteo(3)
 

 

 
143,730

 
5,522,454

Tony D. Bartel
 

 

 
72,562

 
2,722,307

Michael K. Mauler
 
14,070

 
241,250

 
36,556

 
1,371,388


(1)
The value realized on exercise was the number of underlying shares exercised multiplied by the difference between our closing stock price on the exercise date and the exercise price of the options. All amounts are shown prior to the surrender of shares, if any, to cover exercise price or taxes in connection with an exercise of options.
(2)
The value realized on vesting was our closing stock price on the vesting date multiplied by the number of shares vested. All amounts are shown prior to the surrender of shares, if any, to cover withholding taxes in connection with the vestings.
(3)
The value realized on vesting for Mr. DeMatteo reflects certain share awards vested for tax purposes on an accelerated basis in accordance with the Company's Retirement Policy which was adopted in fiscal 2014; however these shares are not scheduled to actually be delivered until the scheduled delivery date or upon Mr. DeMatteo’s earlier retirement. As of January 30, 2016, 39,510 of these shares had not yet been delivered to Mr. DeMatteo.

Pension Plans
The Company does not offer a pension plan; therefore, we have omitted the Pension Benefits Table.

Nonqualified Deferred Compensation
None of the Company’s NEOs participate in the Company’s nonqualified deferred compensation plan; therefore, we have omitted the Nonqualified Deferred Compensation Table.


35


Employment Agreements and Potential Payments upon Termination or Change in Control
We have historically maintained employment agreements with our NEOs. See “Employment Agreements and Severance/Change in Control Benefits” above for a description of the terms of these employment agreements. Amounts owed to the NEOs upon termination or a change in control assuming a triggering event took place on January 30, 2016, the last day of the Company’s most recently completed fiscal year, are presented below.
Name
 
Benefit
 
Termination
Without Cause or
With Good
Reason
 
Termination Without Cause or With Good Reason Upon Change In Control
 
Termination Upon Death
 
Termination Upon Disability
 
Resignation Without Good Reason
J. Paul Raines
 
Salary (1)
 
$
2,500,000

 
$
3,750,000

 
$

 
$

 
$

 
 
Bonus (2)
 
5,000,000

 
7,500,000

 

 

 

 
 
Medical Benefits (3)
 
24,541

 
24,541

 

 

 

 
 
Accelerated Stock Options (4)
 
195,531

 
195,531

 
195,531

 
195,531

 

 
 
Accelerated Restricted Stock (5)
 
3,380,802

 
3,380,802

 
6,920,724

 
3,380,802

 

 
 
Total
 
$
11,100,874

 
$
14,850,874

 
$
7,116,255

 
$
3,576,333

 
$

 
 
 
 
 
 
 
 
 
 
 
 
 
Robert A. Lloyd
 
Salary (1)
 
$
1,376,000

 
$
1,720,000

 
$

 
$

 
$

 
 
Bonus (2)
 
1,376,000

 
1,720,000

 

 

 

 
 
Medical Benefits (3)
 
24,518

 
24,518

 

 

 

 
 
Accelerated Stock Options (4)
 
27,383

 
27,383

 
27,383

 
27,383

 

 
 
Accelerated Restricted Stock (5)
 
1,196,958

 
1,196,958

 
2,476,268

 
1,196,958

 

 
 
Total
 
$
4,000,859

 
$
4,688,859

 
$
2,503,651

 
$
1,224,341

 
$

 
 
 
 
 
 
 
 
 
 
 
 
 
Daniel A. DeMatteo
 
Salary (1)
 
$
1,100,000

 
$
1,650,000

 
$

 
$

 
$

 
 
Bonus (2)
 
1,650,000

 
2,475,000

 

 

 

 
 
Medical Benefits (3)
 
17,265

 
17,265

 

 

 

 
 
Accelerated Stock Options (4)
 
122,223

 
122,223

 
122,223

 
122,223

 
122,223

 
 
Accelerated Restricted Stock (5)(6)
 
1,035,557

 
1,035,557

 
2,937,617

 
1,035,557

 
1,035,557

 
 
Total
 
$
3,925,045

 
$
5,300,045

 
$
3,059,840

 
$
1,157,780

 
$
1,157,780

 
 
 
 
 
 
 
 
 
 
 
 
 
Tony D. Bartel
 
Salary (1)
 
$
1,800,000

 
$
2,250,000

 
$

 
$

 
$

 
 
Bonus (2)
 
2,250,000

 
2,812,500

 

 

 

 
 
Medical Benefits (3)
 
24,567

 
24,567

 

 

 

 
 
Accelerated Stock Options (4)
 
117,302

 
117,302

 
117,302

 
117,302

 

 
 
Accelerated Restricted Stock (5)
 
1,709,207

 
1,709,207

 
3,535,781

 
1,709,207

 

 
 
Total
 
$
5,901,076

 
$
6,913,576

 
$
3,653,083

 
$
1,826,509

 
$

 
 
 
 
 
 
 
 
 
 
 
 
 
Michael K. Mauler
 
Salary (1)
 
$
1,148,000

 
$
1,435,000

 
$

 
$

 
$

 
 
Bonus (2)
 
1,148,000

 
1,435,000

 

 

 

 
 
Medical Benefits (3)
 
24,444

 
24,444

 

 

 

 
 
Accelerated Stock Options (4)
 
19,557

 
19,557

 
19,557

 
19,557

 

 
 
Accelerated Restricted Stock (5)
 
854,996

 
854,996

 
1,768,677

 
854,996