Activision Blizzard (ATVI)

Base Salaries

        Employment agreements with named executive officers typically establish the annual base salaries for such officers. See "—Employment Agreements" above for the specific terms of employment agreements with named executive officers. At the time the Company hires an executive officer or renews or amends an executive officer's employment agreement, the Compensation Committee examines benchmarks, including selected peer companies to set base salaries at appropriate levels to attract and retain talented individuals. Base salaries ultimately result from negotiations between the Company and each named executive officer as part of their employment agreement. The Compensation Committee establishes base salaries, contract lengths and, in some cases, minimum annual salary increases at levels it believes are necessary to attract, retain and motivate talented executives and are consistent with market practice.

        In fiscal 2008, the Company increased the base salary of each of the named executive officers as indicated in the table below:

         Mr. Kotick's Base Salary.    On April 1, 2007, Mr. Kotick's annual base salary increased from $797,200 to $876,920, or 10%, pursuant to his employment agreement then in effect. On December 1,

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2007, the Company increased Mr. Kotick's base salary an additional 8.3% to $950,000 under an amended and restated employment agreement.

         Mr. Kelly's Base Salary.    On April 1, 2007, Mr. Kelly's annual base salary increased from $797,200 to $876,920, or 10%, pursuant to his employment agreement then in effect.

         Mr. Griffith's Base Salary.    Mr. Griffith's annual base salary increased from $648,000 to $700,000, or 8%, in fiscal 2008 pursuant to his employment agreement.

         Mr. Tippl's Base Salary.    Although Mr. Tippl's employment agreement specified an annual base salary increase of 4%, the Company increased Mr. Tippl's base salary from $468,000 to $500,000 in fiscal 2008, or 6.8%, due to his exceptional performance in the previous year.

         Ms. Kaminsky's Base Salary.    Although Ms. Kaminsky's employment agreement specified an annual base salary increase of 4%, the Company increased Ms. Kaminsky's base salary from $468,000 to $495,000 in fiscal 2008, or 5.8%, an increase generally consistent with the average salary increases for Company employees for fiscal 2008.

         Mr. Hodous's Base Salary.    Mr. Hodous's employment agreement provided that his base salary plus salary equivalent items, such as a cost of living allowance, would equal $450,000 until the completion of his initial assignment in the United Kingdom ($375,000 base salary and $75,000 in expatriate salary equivalent items). Mr. Hodous' employment agreement further provides that upon his relocation to the United States, which occurred on November 1, 2007, his base salary would increase to $450,000 and the expatriate salary equivalent items would cease. Accordingly, Mr. Hodous' base salary increase to $475,000 upon his return to the United States reflects the Compensation Committee's desire to establish a new base salary approximately equal to his base salary and accompanying expatriate perquisites and benefits while assigned in the United Kingdom, plus a $25,000 merit-based increase from the previous year.

Base Salaries

        In fiscal 2008, the base salary of each of the named executive officers listed below has increased or will increase, and for each of these named executive officers, the table below sets forth the officer's

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base salary in effect on March 31, 2007, the date on which his new base salary will first become effective, the amount of his new base salary and the percentage increase the new base salary represents.

*

Reflects the date on which the Company currently expects Mr. Hodous to begin performing his duties in the United States following his relocation from the United Kingdom.

The increases for each of Messrs. Kotick, Kelly and Griffith are equal to the percentage increases specified in his respective employment agreement. The employment agreements for each of Mr. Tippl and Ms. Kaminsky specify an annual base salary increase of 4%. Based on the exceptional performance of each of these individuals in fiscal 2007, the Compensation Committee determined that the base salaries for each of Mr. Tippl and Ms. Kaminsky should be increased above the minimum 4% amount. Mr. Hodous's employment agreement provides that his base salary will be $375,000 until the completion of his initial assignment in the United Kingdom and that, upon his relocation to the United States, which is expected to occur in late October 2007, his base salary will increase to $450,000. In offering Mr. Hodous a base salary of $375,000 during his service in the United Kingdom, the Compensation Committee considered that, in accordance with the Company's policy for executives serving outside the United States, Mr. Hodous would receive perquisites and benefits in excess of those received by the named executive officers serving in the United States. Accordingly, his base salary increase upon his return to the United States reflects the Compensation Committee's desire to establish his new base salary at a level intended to approximate that of his current base salary and additional expatriate perquisites and benefits, with an appropriate annual base salary increase.