**Exhibit 10.6**
GAMESTOP CORP.
SUPPLEMENTAL COMPENSATION PLAN
     GameStop Corp., a Delaware corporation (the “Company”), hereby adopts the GameStop Corp.Supplemental Compensation Plan (the “Plan”). The Company intends that bonus compensation payablepursuant to this Plan shall constitute “performance-based compensation” within the meaning ofSection 162(m) (“Section 162(m)”) of the Internal Revenue Code of 1986, as amended (the “Code”),and the regulations from time to time promulgated thereunder.
     1. Purposes of Plan. The purposes of the Plan are to provide personal incentive andfinancial rewards to senior management who, because of the extent of their responsibilities, canand do make significant contributions to the success of the Corporation by their ability, industry,loyalty and exceptional services, by making them participants in that success.
     2. Eligible Employees. The Company’s Chief Executive Officer (the “CEO”), theCompany’s Chief Operating Officer (the “COO”), and such other executive officers of the Company asmay from time to time be designated as Plan participants by the Committee (as defined herein),shall be eligible to receive cash bonus awards under the Plan. The CEO, the COO and each otherexecutive officer designated by the Committee concurrently with or prior to the establishment ofthe applicable Target pursuant to Section 6 below for any Plan Year (or, if later, prior to thecommencement of such individual’s service as an executive officer or such other time as shall bespecified under Section 162(m)) shall be an “Eligible Participant” for such Plan Year. TheCommittee’s designation of a participant in any year shall not require the Committee to designatesuch person to be a participant in any other year.
     3. Plan Year. The Plan Year shall be the fiscal year of the Company. The Company’sfiscal year ending January 31, 2004 shall be the first Plan Year.
     4. Effective Date. The Plan was adopted by the Board of Directors on May 14, 2003 andshall become effective upon approval of the material terms hereof by the Company’s stockholders inaccordance with the requirements of Section 162(m).
     5. Administration.
          (a) The Committee. The term “Committee” as used herein shall mean the Committee of the Boardof Directors or such other committee of the Board of Directors designated to administer this Plan,in either case consisting of two or more members of the Board and with each such member qualifyingas an outside director as defined under Section 162(m).
          (b) Authority. Subject to the provisions of the Plan, the Committee shall interpret the Planand the awards granted under the Plan, shall make all other determinations necessary or advisablefor the administration of the Plan and shall correct any defect or supply any omission or reconcileany inconsistency in the Plan or in any award, in the manner and to the extent the Committee deemsdesirable to carry the Plan or award into effect.
          (c) Procedure. All determinations of the Committee shall be made by not less than a majorityof its members at a meeting at which a quorum is present. A majority of the entire Committee shallconstitute a quorum for the transaction of business. Any action required or permitted to be takenat a meeting of the Committee may be taken without a meeting, if a unanimous written consent whichsets forth the action is signed by each member of the Committee and filed with the minutes of theproceedings of the Committee. No member of the Committee shall be liable, in the absence of badfaith, for any act or omission with respect to his services. Without limiting the generality ofthe foregoing or the scope of anyapplicable provision of the Company’s Certificate ofIncorporation or Bylaws or any indemnification
1

 

 agreement, no member of the Committee shall be liable for any action ordetermination made in good faith with respect to the Plan or any award granted thereunder.
     6. Awards. Not later than 90 days after the commencement of each Plan Year (andbefore 25% of the relevant period of service for each Eligible Participant has elapsed), theCommittee shall establish in writing separately for each Eligible Participant (a) the percentage ofsuch Eligible Participant’s base salary that shall be the subject of an award and (b) a performancetarget (the “Target”), the attainment of which shall be substantially uncertain.
     The Committee may establish performance targets based on one or more of the followingperformance measures (either individually or in any combination): net sales; pretax income beforeallocation of corporate overhead and bonus; budget; earnings per share; net income; division, groupor corporate financial goals; return on stockholders’ equity; return on assets; attainment ofstrategic and/or operational initiatives; appreciation in and/or maintenance of the price of theClass A common stock or any other publicly-traded securities of the Company; market share; grossprofits; earnings before taxes; earnings before interest and taxes; earnings before interest,taxes, depreciation and amortization; economic value-added models; comparisons with various stockmarket indices and/or similar companies; and/or reductions in costs.
     Targets which are based in whole or part on per share amounts, such as earnings per share,shall be, and, at the discretion of the Committee, any other Targets may be, subject to adjustmentfor recapitalizations, dividends, stock splits and reverse splits, reorganizations, issuances ofadditional shares, redemptions of shares, option or warrant exercises, reclassifications,significant acquisitions and divestitures or other extraordinary events.
     Each Eligible Participant will receive a cash bonus in the amount of the pre-determinedpercentage of his or her base salary (the “Target Bonus”) as follows:       Then the Percentage of the If the Plan Year Results were: Target Bonus Received is: Less than 85% of Target None85% or more but less than 90% of Target  50%90% or more but less than 100% of Target  75%100% or more but less than 110% of Target  100%110% or more but less than 125% of Target  110%125% or more of Target  125%
     Notwithstanding the foregoing, in no event shall the maximum cash bonus payable to anyEligible Participant under the Plan exceed $1,500,000 with respect to any Plan Year. Cash bonuseswill not become payable and will not be paid until the Committee certifies the extent to which theTarget has been attained.
     The pre-determined percentage for any one participant and/or the performance measures ortargets relating thereto may be different than or the same as that of any other participant and, asfor each participant, may be different than or the same as applied to such participant in any prioryear.
     7. Form and Payment of Awards. Awards to Eligible Participants shall be made onlywhen the Committee has certified that the Targets have been attained. Awards shall be made in cashand shall be payable in a lump sum.
     All awards shall be paid from the general funds of the Company and no special or separate fundshall be established and no other segregation of assets shall be made to assure the payment ofawardshereunder. An Eligible Participant shall have no right, title, or interest whatsoever in orto any investments which the Company may make to aid it in meeting its obligations hereunder.Nothing contained in this instrument, and no action taken pursuant to its provisions, shall createor be construed to create a trust of
2

 

any kind, or a fiduciary relationship, between the Company andan Eligible Participant or any other person. To the extent that any person acquires a right toreceive payments from the Company, such right shall be no greater than the right of an unsecuredcreditor.
     If an Employee dies or becomes incapacitated, any award so made shall be paid to his estate orlegal representative at such time and in such manner as if he were living or not incapacitated.
     8. Amendment. The Board retains the authority to amend the Plan, subject to thestockholder approval requirements of Section 162(m) of the Code.
3