8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT PURSUANT

TO SECTION 13 OR 15(D) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported) June 5, 2007

ELECTRONIC ARTS INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware

(State or Other Jurisdiction of Incorporation)

0-17948	94-2838567
(Commission File Number)	(IRS Employer Identification No.)

209 Redwood Shores Parkway, Redwood City, California 94065-1175

(Address of Principal Executive Offices) (Zip Code)

(650) 628-1500

(Registrant’s Telephone Number, Including Area Code)

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Appointment of Executive Officer.

On June 5, 2007, Electronic Arts Inc. (“EA”) issued a press release in which it announced that it had entered into a letter of employment with Kathy Vrabeck, age 44, (the “Offer Letter”) under which EA agreed to appoint Ms. Vrabeck as President of EA Casual Entertainment, effective May 30, 2007. EA Casual Entertainment is a newly-formed division of EA dedicated to developing and publishing games for consoles, PCs, handheld devices and mobile phones.

From August 1999 until April 2006, Ms. Vrabeck held various positions at Activision, Inc., an interactive entertainment company, including President of Activision Publishing, Executive Vice President, Global Publishing and Brand Management, and Executive Vice President, Global Brand Management. Following her departure from Activision, Ms. Vrabeck served as a consultant with various companies, including EA. Prior to joining Activision, Ms. Vrabeck was Senior Vice President/General Manager with ConAgra Foods, Inc., and also served in various marketing and sales roles for the Pillsbury Company and held positions at Quaker Oats Company and Eli Lilly & Company. Ms. Vrabeck serves on the board of directors of AVP, Inc., a publicly-traded lifestyle sports entertainment company focused on professional beach volleyball. Ms. Vrabeck received a B.A. degree from DePauw University and an M.B.A. degree from Indiana University.

A copy of the press release is attached hereto as Exhibit 99.1.

Compensatory Arrangements with Ms. Vrabeck

A copy of the Offer Letter is attached hereto as Exhibit 10.1 to this Form 8-K and is incorporated herein by reference. The following summary of the Offer Letter does not purport to be complete and is subject to and qualified in its entirety by reference to the attached agreement.

The material terms of the Offer Letter are as follows:

• Ms. Vrabeck’s annual base salary will be $550,000 and her discretionary target bonus percentage will be 75% of her annual base salary.

• EA has agreed to grant Ms. Vrabeck a stock option to purchase 315,000 shares of the company’s common stock pursuant to EA’s 2000 Equity Incentive Plan. The stock option will vest as to 24% of the shares one year from the grant date, and will then vest in additional 2% increments each month thereafter for the following 38 months.

• EA has agreed to grant Ms. Vrabeck 45,000 restricted stock units, which vest as to 100% of the shares on the four-year anniversary of the grant date.

In accordance with EA’s standard equity grant policies, Ms. Vrabeck’s stock option and restricted stock units are scheduled to be granted on June 18, 2007, the first regularly-scheduled date following Ms. Vrabeck’s start date for which EA’s Compensation Committee will approve equity grants.

Ms. Vrabeck will participate in the compensation and benefit programs available to EA’s executive officers.

Item 9.01. Financial Statements and Exhibits.

Exhibit No.	Description
10.1	Offer Letter dated May 10, 2007.
99.1	Press release dated June 5, 2007.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ELECTRONIC ARTS INC.
Dated: June 5, 2007	By:	/s/ Joel Linzner
		Joel Linzner
		Executive Vice President,
		Business and Legal Affairs

EX-10.1

Exhibit 10.1

May 10, 2007

Kathy Vrabeck

Dear Kathy:

Congratulations! Please accept our offer to become part of EA’s rich game making history and future.

I am pleased to offer you a regular full-time position with Electronic Arts as President, Casual Entertainment Division commencing on May 30, 2007 at a base salary of $45,833.33 per month or $550,000 annualized, minus applicable deductions. You will be reporting directly to me.

For your information, I have enclosed several documents that will provide an introduction to life at EA, including an overview of our benefits programs and EA’s Global Code of Conduct. Other EA policies and procedures are on EA’s intranet and will be reviewed with you at orientation.

You will also be eligible to participate in our discretionary bonus program. This discretionary bonus is typically determined at the end of our fiscal year (March) and is prorated for your months of employment. You need to be employed by EA by January 15th to be eligible for a bonus in this fiscal year. Your discretionary bonus target will be 75% of your salary. To receive payment of your bonus you must be employed by Electronic Arts at the time any bonuses are paid. In addition, EA reviews performance and compensation levels annually, and it currently makes merit adjustments in June of each year. To be eligible for a merit increase at next June’s review, you must commence employment by January 15th of the same calendar year.

I will recommend to the Compensation Committee that you be granted a Non-Qualified Stock Option to purchase 315,000 shares of Electronic Arts common stock in accordance with our 2000 Equity Incentive Plan. This stock option will first vest and become exercisable as to 24% of the underlying shares, 12 months from Vest Start Date and will then vest in 2% increments on the first calendar day of each month thereafter for 38 months. The Committee typically grants and prices stock options on the 16^th of each month or on the next business day following when this date falls on a weekend or holiday; however, the date on which the Committee acts could be later depending on a variety of factors, including the proximity of your start date to the 16^th. You will receive more details regarding this stock option from Stock Administration after the grant date

In addition, I will recommend to the Compensation Committee that you be granted a one-time Ownership Award in the form of 45,000 Restricted Stock Units (RSUs) in accordance with our 2000 Equity Incentive Plan. This Award will first vest as to 100% of the shares on the four-year anniversary of the grant date. The Committee typically grants RSUs on the 16^th of each month or on the next business day following when this date falls on a weekend or holiday; however, the date on which the Committee acts could be later depending on a variety of factors, including the proximity of your start date to the 16^th. You will receive more details regarding this Award from Stock Administration after the grant date.

Kathy Vrabeck

May 10, 2007

Lastly, you will accrue Paid Time Off (PTO) at the rate of four weeks per year (or 6.150 hours per pay period) up to the maximum accrual of 200 hours. While this accrual rate is an exception to our current PTO policy, the PTO policy will apply in all other respects (including future accrual rates) unless the policy is otherwise modified or we otherwise agree in writing.

If you have any questions about this offer or about your eligibility to participate in or to be covered by any of the described benefits, please call me.

In the course of your work, you will have access to proprietary materials and concepts. Our offer is contingent on your signing Electronic Arts’ New Hire/ Proprietary Information Agreement. Two copies are enclosed for signature (please keep one for your own records).

This offer letter contains the entire understanding between you and Electronic Arts as to the terms of your offer of employment and specifically supersedes all previous discussions you may have had with anyone at Electronic Arts regarding those terms.

This offer of employment is made contingent upon your providing Electronic Arts with proof that you have the legal right to work in the United States. This will be handled as part of your orientation process.

In addition, EA will conduct a background check pursuant to a written notice you will receive under separate cover, and this offer of employment is contingent upon the results of such check being acceptable to EA.

This offer of employment is valid through May 15, 2007. If you accept this offer, please sign below and return both pages of the original offer letter to Cindy Nicola, in Talent Acquisition in the enclosed envelope, and we can begin your orientation to EA. Please keep a copy for yourself.

Please join our team and help us be the place where GREAT people create and deliver GREAT games.

If you have any questions regarding this offer, please feel free to contact me.

Sincerely,

/s/ John Riccitiello

John Riccitiello

Chief Executive Officer

JSR/dal

Enclosures

Accepted by candidate:	Date:
/s/ Kathy Vrabeck	May 11, 2007

Anticipated Start Date: May 30, 2007

cc: Imelda Oki for distribution to Personnel File

Page 2

EX-99.1

Exhibit 99.1

Contacts: Jeff Brown VP, Corporate Communications 650-628-7922 jbrown@ea.com Tricia Gugler Director, Investor Relations 650-628-7327 tgugler@ea.com

EA APPOINTS KATHY VRABECK TO LEAD EA CASUAL ENTERTAINMENT

New Group to Focus on Lighter Games for Family and New Consumers

REDWOOD CITY, Calif. – June 5, 2007 – Electronic Arts Inc. (NASDAQ:ERTS) today announced the formation of EA Casual Entertainment, dedicated to developing and publishing games for consoles, PCs, handheld devices and mobile phones. Kathy Vrabeck has been appointed to lead the group as President of EA Casual Entertainment.

“All over the world, consumers are playing games that don’t require hours of intense concentration,” said Kathy Vrabeck, President of EA Casual Entertainment. “The common denominator is casual fun. Whether it will be playing Harry Potter and the Order of the Phoenix™ on the Wii™ with the family or downloading Madden NFL 08 on a phone, quick-to-the-fun games are bringing new players and new demographics to interactive entertainment.”

“EA is aligning talent and resources to focus on the growing market for highly accessible games,” said EA CEO John Riccitiello. “We’re fortunate to have recruited a dynamic executive like Kathy Vrabeck to lead this team. She’s got a proven success record in our industry and the ability to help EA lead this fast-growing genre of entertainment.”

Kathy Vrabeck has a distinguished background in management, marketing, sales and development. She served as President of Activision Publishing, a position which included oversight of that company’s worldwide studios. She has also held management positions in marketing and sales for Pillsbury Company, Quaker Oats and ConAgra.

New games, franchises and licenses to be developed and published by EA Casual Games will be announced in the future.

###

About Electronic Arts

Electronic Arts Inc. (EA), headquartered in Redwood City, California, is the world’s leading interactive entertainment software company. Founded in 1982, the company develops, publishes, and distributes interactive software worldwide for video game systems, personal computers, cellular handsets and the Internet. Electronic Arts markets its products under four brand names: EA SPORTS™, EA™, EA SPORTS BIG™ and POGO™. In fiscal 2007, EA posted revenue of $3.09 billion and had 24 titles that sold more than one million copies. EA’s homepage and online game site is www.ea.com. More information about EA’s products and full text of press releases can be found on the Internet at http://info.ea.com.

EA, EA SPORTS, EA SPORTS BIG and POGO are trademarks or registered trademarks of Electronic Arts Inc. in the U.S. and/or other countries. John Madden and NFL are trademarks of their respective owners and used with permission. HARRY POTTER characters, names and related indicia are trademarks of and ^© Warner Bros. Entertainment Inc. Harry Potter Publishing Rights ^© JKR. Wii is a trademark of Nintendo. All other trademarks are the property of their respective owners.

Some statements in the future tense contained in this release are forward-looking statements that are subject to change. These forward-looking statements are subject to risks and uncertainties that could cause actual events or actual future results to differ materially from the expectations set forth in the forward-looking statements. Some of the factors which could cause the Company’s results to differ materially from its expectations are described in the Company’s Annual Report on Form 10-K for the year ended March 31, 2007. These forward-looking statements speak only as of the date of this release and Electronic Arts assumes no obligation and does not intend to update these forward-looking statements.