Form 8-K ZYNGA INC For: Apr 07

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

April 7, 2015

Date of Report (Date of earliest event reported)

 

 

Zynga Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware		001-35375		42-1733483
(State or other jurisdiction of incorporation or organization)		(Commission File No.)		(I.R.S. employer identification number)

699 Eighth Street

San Francisco, CA 94103

(Address of principal executive offices, including zip code)

(855) 449-9642

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:

 

¨	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))

 

 

 

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

 

(a)

Resignation of Chief Executive Officer

Effective April 8, 2015, Don Mattrick resigned as Chief Executive Officer of Zynga Inc. (“Zynga”), as a member of the Board of Directors (the “Board”) and from all other positions with Zynga. Zynga entered into a Separation Agreement and General Release, dated April 8, 2015 (the “Separation Agreement”), with Mr. Mattrick to memorialize the parties’ mutual desire to separate employment. The Separation Agreement provides, among other things:

 

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Mr. Mattrick resigned from his position as Zynga’s Chief Executive Officer and all other positions he had with Zynga’s subsidiaries and affiliates, including as a director of Zynga.

 

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Mr. Mattrick will receive a severance payment of $4,000,000, as provided in his offer letter. The severance amount will be paid ratably over the 24 months following Mr. Mattrick’s resignation. The Company will accelerate the vesting of 5,111,081 unvested restricted stock units and unvested options to purchase 189,552 shares of Class A common stock previously granted to Mr. Mattrick. The vested awards will remain exercisable for 24 months following Mr. Mattrick’s resignation.

 

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Mr. Mattrick will receive a lump sum cash payment equal to the lesser of (i) the annual cash bonus, if any, that he would have been paid pursuant to Zynga’s cash incentive plan for 2015 and (ii) $1,000,000, in each case, pro-rated for the days he worked for Zynga in fiscal 2015. Any such bonus would be paid on the date that annual bonuses are paid to then-current employees of Zynga.

 

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If Mr. Mattrick makes a timely election to continue coverage under COBRA, Zynga will pay the COBRA premiums to continue coverage for Mr. Mattrick and his eligible dependents for up to eighteen months after the date of his resignation.

 

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Mr. Mattrick will also receive up to $25,000 to reimburse attorneys’ fees and costs that he may incur for legal advice relating to his resignation.

 

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Zynga and Mr. Mattrick agreed to terminate all other agreements between them other than Mr. Mattrick’s employee invention assignment agreement, including Mr. Mattrick’s offer letter, all outstanding but unvested equity awards and Zynga’s other plans and arrangements for the benefit of employees.

 

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Mr. Mattrick and Zynga each agreed not to disparage the other in in any manner likely to be harmful to their respective business or personal reputation.

 

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Mr. Mattrick agreed to a release of claims related to Mr. Mattrick’s employment and other relationships with Zynga and Zynga’s affiliates, and the termination of Mr. Mattrick’s employment and other relationships with Zynga and Zynga’s affiliates. Payment of the severance and accelerated vesting described above is contingent upon Mr. Mattrick executing and not revoking the release of claims.

 

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Certain of Mr. Mattrick’s obligations, such as those in relation to intellectual property, non-solicitation and confidentiality, remain in effect.

The foregoing summary of the Separation Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Separation Agreement, which is attached as Exhibit 99.1 and incorporated herein by reference.

 

(b)

Appointment of Chief Executive Officer

The Board appointed Mark Pincus, Zynga’s Chairman of the Board, as Zynga’s Chief Executive Officer, effective April 8, 2015. Mr. Pincus is our Founder and had previously served as Zynga’s Chief Executive Officer from April 2007 to July 2013. In addition, he served as Chief Product Officer from April 2007 to April 2014 and has served as Chairman of the Board since April 2007.

In 2014 Mr. Pincus founded superlabs, a product lab focused on developing products that connect and empower people. Mr. Pincus also founded Zynga.org in 2009, a non-profit organization dedicated to using social games for social good. In 2003, he launched Tribe.net, one of the first social networks in the industry. He served as Chief Executive Officer and Chairman of tribe.net from 2003-2007. From 1997 to 2000, he served as Chairman of Support.com, Inc. (NASDAQ: SPRT),

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a help desk automation software company he founded, and he served as Chief Executive Officer and President from December 1997 to July 1999. From 1996 to 1997, he served as Chief Executive Officer of FreeLoader, Inc., a web-based news company he founded. He holds an M.B.A. from Harvard Business School and a B.S. in Economics from the University of Pennsylvania’s Wharton School of Business.

There are no family relationships between Mr. Pincus and any director or executive officer of Zynga.

Mr. Pincus will receive an annual salary of $1 in connection with his appointment as Chief Executive Officer. The preceding description of Mr. Pincus’s compensatory arrangements is qualified in its entirety by reference to his offer letter, which is filed hereto as Exhibit 10.1. No other new compensatory arrangements were entered into with Mr. Pincus in connection with his appointment as Chief Executive Officer.

 

(c)

Compensatory Arrangements of Certain Officers

At a meeting of the Compensation Committee (the “Committee”) of the Board held on April 7, 2015, the Committee unanimously approved the grant of restricted stock awards to each of David Lee, Zynga’s Chief Financial Officer and Chief Accounting Officer and Devang Shah, Zynga’s General Counsel, Secretary and Vice President, for 500,000 shares of Zynga’s Class A common stock, which awards will be granted on April 8, 2015, commence vesting on April 15, 2015 and will vest ratably each quarter over a four year period, in each case subject to continued service to Zynga.

Item 8.01. Other Events.

On April 8, 2015, Zynga issued a joint press release relating to the change in management. This press release is attached as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference. This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or incorporated by reference in any other filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits.

 

(d)

Exhibits.

 

Exhibit Number		Description
10.1		Offer Letter, between Zynga Inc. and Mark Pincus, dated April 8, 2015.
99.1		Separation Agreement and General Release, between Zynga Inc. and Don Mattrick, dated April 8, 2015.
99.2		Press release issued by Zynga Inc., dated April 8, 2015.

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SIGNATURES

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

 

				Zynga Inc.
Date: April 8, 2015				By:		/s/ Devang Shah
						Devang Shah
						General Counsel, Secretary and Vice President

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INDEX TO EXHIBITS

 

Exhibit Number		Description
10.1		Offer Letter, between Zynga Inc. and Mark Pincus, dated April 8, 2015.
99.1		Separation Agreement and General Release, between Zynga Inc. and Don Mattrick, dated April 8, 2015.
99.2		Press release issued by Zynga Inc., dated April 8, 2015.

Exhibit 10.1

 

April 8, 2015

VIA HAND DELIVERY

Mark Pincus

Re:    Offer of Employment by Zynga Inc.

Dear Mark:

I am very pleased to confirm our offer to you of employment with Zynga Inc., a Delaware corporation (the “Company”), in the position of Chief Executive Officer, reporting to the Company’s Board of Directors (the “Board”). This letter acknowledges that you are voluntarily resigning your position as a non-employee Director of the Company’s Board and instead will become an employee of the Company. You will continue to serve as the Chairman of the Board of Directors of the Company. The terms of this offer and the benefits currently provided by the Company are as follows:

1. Salary. Your salary will be one dollar per year, less deductions and withholdings and payable on the Company’s regular payroll schedule. Your salary will be subject to annual review by the Compensation Committee of the Board (the “Committee”) after 12-months based on the Committee’s overall assessment of your performance and the performance of the Company.

2. Bonus. Any annual bonus target amount will be competitive for your position, as reasonably determined by the Committee, and aligned with the Company’s practices and policies. Whether you receive an annual bonus for any given fiscal year, and the amount of any such bonus, will be determined by the Board (or the Committee) in its sole discretion based upon its assessment of the Company’s achievement of performance conditions (to be set by the Board or the Committee) during the applicable fiscal year, subject to the discretion of the Board or the Committee to decrease the amount of such bonus based on its assessment of your individual performance. In order to earn an annual bonus for any given fiscal year, you must remain continuously employed by the Company through the date that the bonus is paid, which is usually within the first quarter of the fiscal year following the fiscal year for which the bonus has been awarded. Any annual bonus paid to you will be paid not later than March 15 of the year following the year in respect to which it is paid, and will be subject to standard payroll deductions and withholdings.

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3. Benefits. You will be eligible to participate in insurance programs and other employee benefit plans established by the Company for its employees from time to time in accordance with the terms of those programs and plans. The Company reserves the right to change the terms of its programs and plans at any time.

4. Confidentiality. As an employee of the Company, you have access to certain confidential information of the Company and you may, during the course of your employment, develop certain information or inventions that will be the property of the Company. To protect the interests of the Company, you signed the Company’s standard Employee Invention Assignment and Confidentiality Agreement (the “Confidentiality Agreement”, the terms of which are reincorporated by reference herein) as a condition of your employment. You hereby agree that the Confidentiality Agreement will govern and be applicable to your prior employment with the Company’s predecessors, Presidio Media LLC, a California limited liability company, and Presidio Media Inc., a Delaware corporation, and your employment with the Company, and will survive thereafter according to its terms. We wish to impress upon you that we do not want you to, and we have directed you not to, bring with you any confidential or proprietary material of any former employer or to violate any other obligations you may have to any former employer. You will disclose to the Company in writing any other gainful employment, business or activity that you are currently associated with or participate in that competes with the Company. You represent that your signing of this Letter, any prior employment letter, each agreement setting forth the terms and conditions of the stock awards granted to you, if any, under the Company’s equity plans, and the Confidentiality Agreement, and your commencement of employment with the Company, do not violate any agreement currently in place (either on the date you previously commenced employment with the Company or now) between yourself and current or past employers.

5. Non-Executive Director Equity. By accepting this offer of employment and becoming an employee of the Company, you understand and agree that you will be ineligible to continue vesting in equity grants that you were provided as a non-executive Director of the Company. As a result, after the effective date of this Letter, any unvested Zynga stock units granted based on your service as a non-executive Director shall be cancelled.

6. Conflict of Interest. Prior to execution of this letter, the Company acknowledges that you have disclosed to the Company any other gainful employment, business or activity that you are currently associated with or participate in that potentially competes, directly or indirectly, with the Company. During your employment, except for passive investments in which you are not actively engaged as an employee, director or consultant, you agree not to engage in any employment, business or activity that competes with the business or proposed business of the Company or which materially interferes with the performance of your job duties. You will be responsible to comply with Zynga’s Conflict of Interest Policy, including updated disclosures of such outside activities, at all times during employment.

7. Background Check. This offer of employment is contingent upon successful completion of a background check.

8. Authorization to Work. This offer is also contingent upon proof of identity and work eligibility. Please note that because of employer regulations adopted in the Immigration Reform

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and Control Act of 1986, within three (3) business days of starting your new position you will need to present documentation demonstrating that you have authorization to work in the United States. If you have questions about this requirement, which applies to U.S. citizens and non-U.S. citizens alike, you may contact our personnel office.

9. Entire Agreement. This offer letter and the documents referred to herein constitute the entire agreement and understanding of the parties with respect to the subject matter of this offer, and supersede any and all prior understandings and agreements, whether oral or written, between or among the parties hereto with respect to the specific subject matter hereof. If any term herein is unenforceable in whole or in part, the remainder shall remain enforceable to the extent permitted by law.

10. Termination. If, at any time, (i) you resign your employment for any reason, (ii) the Company terminates your employment for any reason, or (iii) either party terminates your employment as a result of your death or disability, you will receive your Salary accrued through your last day of employment, as well as any unused vacation (if applicable) accrued through your last day of employment.

11. At Will Employment. You will be an at will employee of the Company, which means the employment relationship can be terminated by either of us for any reason, at any time, with or without prior notice and with or without cause. Any statements or representations to the contrary (and any statements contradicting any provision in this Letter) should be regarded by you as ineffective. Further, your participation in any stock incentive or benefit program is not to be regarded as assuring you of continuing employment for any particular period of time. Any modification or change in your at will employment status may only occur by way of a written employment agreement signed by you and a member of the Company’s Board of Directors (other than you).

12. Acceptance. Please sign the enclosed copy of this Letter in the space indicated and return it to me. Your signature will acknowledge that you have read and understood and agreed to the terms and conditions of this Letter and the attached documents, if any. Should you have anything else that you wish to discuss, please do not hesitate to call me.

We look forward to your continued employment with the Company.

 

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I have read and understood this Letter and hereby acknowledge, accept and agree to the terms as set forth above and further acknowledge that no other commitments were made to me as part of the terms of my employment except as specifically set forth herein.

 

/s/ Mark Pincus		Date signed:		4/8/2015
Mark Pincus

Exhibit 99.1

SEPARATION AGREEMENT AND GENERAL RELEASE

THIS SEPARATION AGREEMENT AND GENERAL RELEASE (this “Agreement”), dated as of April 8, 2015, is made by and between Zynga Inc., a Delaware corporation (the “Company”), and Don Mattrick (“Executive”, and together with the Company, the “Parties”).

WHEREAS, the Parties entered into an offer letter, dated as of June 30, 2013 (the “Offer Letter”), pursuant to which Executive commenced employment with the Company on July 8, 2013;

WHEREAS, as part of the Company’s inducement to hiring Executive, the Parties entered into an Employee Invention Assignment and Confidentiality Agreement, effective July 8, 2013 (the “Employee Assignment and Confidentiality Agreement”), pursuant to which Executive assigned certain work product and agreed to the restrictive covenants set forth in the Employee Assignment and Confidentiality Agreement; and

WHEREAS, Executive’s service as the Chief Executive Officer of the Company shall terminate effective as of April 8, 2015 (the “Termination Date”); and

WHEREAS, the Parties desire to enter into this Agreement, which sets forth certain terms relating to the termination of Executive’s employment, reaffirms Executive’s obligations under the Employee Assignment and Confidentiality Agreement and provides for certain payments and benefits that shall be made to Executive as a result of his termination of employment.

NOW, THEREFORE, in consideration of the mutual promises contained in this Agreement, together with other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1. Termination of Employment.

(a) The Parties acknowledge and agree that Executive’s services as the Chief Executive Officer of the Company and employment with the Company and its affiliates shall terminate as of the Termination Date. Executive has resigned or hereby resigns all positions he has held as an officer and director of the Company and its subsidiaries and affiliates, effective as of the date hereof, and shall promptly execute such documents and take such actions as may be necessary or reasonably requested by the Company to further effectuate or further memorialize the resignation from such positions.

(b) On the Termination Date, irrespective of whether Executive executes this Agreement, the Company shall pay Executive a lump sum cash payment in respect of the Executive’s (i) accrued but unpaid base salary earned through the Termination Date, and (ii) accrued but unused vacation time earned through the Termination Date. In addition, the Company shall reimburse Executive for all business expenses incurred on behalf of the Company through the Termination Date, in accordance with the Company’s policies with respect to the reimbursement of expenses.

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2. Severance Payments and Benefits. If Executive (a) executes this Agreement and the revocation period described in Section 8 hereof expires within sixty (60) days following the Termination Date (the date on which such revocation period expires, the “Release Effective Date”) and (b) continues to comply with the covenants under the Employee Assignment and Confidentiality Agreement and any other material ongoing obligations to which he is subject, then the Executive shall be entitled to the following (the “Severance Benefits”):

(a) An amount in cash equal to $4,000,000, payable in substantially equal installments for twenty-four (24) months following the Termination Date (the “Payment Period”) in accordance with the Company’s normal payroll practices; provided that the first such payment shall be made on the first regularly scheduled payroll date following the Release Effective Date and shall include all payments that would have otherwise been made between the Termination Date and the Release Effective Date if such payments had commenced on the Termination Date;

(b) A lump sum cash payment equal to the product of (i) the lesser of (A) the cash bonus, if any, that would have been paid to Executive pursuant to the terms of the annual cash incentive plan in which Executive participates in respect of the 2015 fiscal year, had he remained in employment and (B) $1,000,000 and (ii) a fraction, the numerator of which is the number of days that elapsed in the 2015 fiscal year through the Termination Date and the denominator of which is 365, payable on the date such bonuses are paid to then-current employees of the Company;

(c) Subject to Executive’s timely election to continue coverage under COBRA, the Company shall pay the COBRA premiums to continue Executive’s coverage (including coverage for Executive’s eligible dependents, if applicable) for eighteen (18) months following the Termination Date (with such payments to end if Executive becomes eligible for group health insurance coverage through a new employer or Executive ceases to be eligible for COBRA continuation coverage for any reason), provided that the cost of such coverage shall be reported to the tax authorities as taxable income to Executive;

(d) 4,882,143 shares of Class A common stock, par value $0.00000625 per share of the Company (each, a “Share”) subject to the Make-Whole Grant (as defined in the Offer Letter) shall vest as of the Termination Date;

(e) 228,938 Shares subject to Executive’s Restricted Stock Unit Grant Notice and Restricted Stock Unit Agreement, dated March 14, 2014, shall vest as of the Termination Date; and

(f) 189,552 Shares subject to Executive’s Stock Option Grant Notice and Option Agreement, dated March 14, 2014, shall vest as of the Termination Date. Executive shall have up to two (2) years from the Termination Date to exercise not only these vested Shares, but also the Shares from all previously vested and currently unexercised Stock Option Grants.

(g) Company agrees to reimburse Executive for attorneys’ fees and costs that he may incur for legal advice regarding the negotiation of this Agreement, up to a maximum payment of $25,000.

 

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Notwithstanding any other provision of this Agreement to the contrary, if, on or following the Termination Date, Executive (i) fails to comply with his material obligations to the Company or (ii) materially breaches any of the covenants under the Employee Assignment and Confidentiality Agreement or Section 15 of the Offer Letter or any other material ongoing obligations to which he is subject, then Executive shall immediately forfeit his right to receive the Severance Benefits, to the extent then unpaid, provided that such material breach or obligation causes a measure of harm to the Company. The Company shall provide Executive with written notice of the breach and give him ten (10) days to either cure the breach, to the extent curable, or explain why he does not believe there has been a breach. This paragraph shall be in addition to any other remedy at law or in equity available to the Company.

3. Executive Acknowledgements and Covenants.

(a) Executive acknowledges that the Company has provided him with all monies and benefits to which he is owed under the Offer Letter or otherwise, and that the Company’s agreement to provide the Severance Benefits is solely in exchange for the promises, releases and agreements of Executive set forth in this Agreement. Executive acknowledges that any unvested equity awards held by Executive on the Termination Date (after giving effect to the vesting provisions contained in Section 2(d), Section 2(e) and Section 2(f) of this Agreement) shall be immediately cancelled on the Termination Date. Executive further acknowledges that neither entering into this Agreement nor providing Executive with such Severance Benefits constitutes an admission by the “Releasees” (as defined below) of liability or of violation of any applicable law or regulation. The Parties acknowledge that the Releasees expressly deny any liability or alleged violation and that this arrangement has been made in recognition of Executive’s service to the Company and for the purpose of compromising any and all claims of Executive without the cost and burden of litigation. Executive acknowledges and agrees that he is required to execute and continue to comply with the terms of this Agreement and the Employee Assignment and Confidentiality Agreement as a condition to receiving the Severance Benefits, and would not be entitled to the Severance Benefits if he did not do so.

(b) For a period of four years from the date of this Agreement: (i) Executive agrees not to disparage the Company and its officers, directors, employees, shareholders, and agents, in any manner likely to be harmful to its or their business, business reputation, or personal reputation in any form; and (ii) Company agrees that its officers will not disparage Executive in any manner likely to be harmful to his business or personal reputations in any form. Provided, however, that either party may respond accurately and fully to any question, inquiry or request for information when required by legal process.

4. General Release of Claims.

(a) Executive and his heirs, personal representatives, successors and assigns, hereby forever release, remise and discharge the Company and its subsidiaries, and each of their past, present, and future officers, directors, shareholders, members, employees, trustees, agents, representatives, affiliates, successors and assigns (collectively referenced herein as “Releasees”) from any and all claims, claims for relief, demands, actions and causes of action of any kind or description whatsoever, known or unknown, whether arising out of contract, tort, statute, regulation or otherwise, in law or in equity, which Executive now has, has had, or may hereafter

 

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have against any of the Releasees (i) from the beginning of time through the date upon which Executive signs this Agreement, and/or (ii) arising from, connected with, or in any way growing out of, or related to, directly or indirectly, (A) Executive’s service as an officer, director or employee, as the case may be, of the Company and its subsidiaries and affiliates, (B) any transaction prior to the date upon which Executive signs this Agreement and all effects, consequences, losses and damages relating thereto, (C) the Offer Letter, (D) all cash incentive awards, and all equity or equity-based awards granted, or promised to be granted, by the Company to Executive and (E) Executive’s termination of employment with the Company under the common law or any federal or state statute, including, but not limited to, all claims arising under Title VII of the Civil Rights Act of 1964, as amended; the Civil Rights Act of 1991, as amended; the Equal Pay Act; the False Claims Act, 31 U.S.C.A. § 3730, as amended, including, but not limited to, any right to personal gain with respect to any claim asserted under its “qui tam” provisions; Sections 1981 through 1988 of Title 42 of the United States Code, as amended; the Employee Retirement Income Security Act of 1974, as amended; the Immigration Reform and Control Act, as amended; The Americans with Disabilities Act of 1990, as amended; the Age Discrimination in Employment Act of 1967, as amended (“ADEA”); the Older Workers’ Benefit Protection Act of 1990, as amended; the Worker Adjustment and Retraining Notification Act, as amended; the Occupational Safety and Health Act, as amended; the Fair Labor Standards Act of 1938; Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”); any other federal, state or local civil or human rights law or any other local, state or federal law, regulation or ordinance; any public policy, contract, tort, or common law; or any allegation for costs, fees, or other expenses including attorneys’ fees incurred in these matters.

(b) Notwithstanding the foregoing, nothing in this Agreement shall release or waive any rights or claims Executive may have: (i) under this Agreement or to the Severance Benefits; (ii) for indemnification under any written indemnification agreement by and between Executive and the Company and/or under applicable law or the Company’s charter or bylaws; (iii) under any applicable insurance coverage(s) (including, without limitation, COBRA rights); (iv) with respect to any accrued and vested benefits under any tax-qualified retirement plans of the Company; (v) with respect to any claims that cannot be waived by operation of law; (vi) with respect to any claims which may arise after Executive signs this Agreement; or (vii) with respect to Executive’s right to challenge the validity of the release under the ADEA. For a period of four years following the date of this Agreement, any Directors and Officers liability insurance procured by the Company, shall include coverage for Executive for claims covered by such insurance policies.

(c) Executive acknowledges having read and understood Section 1542 of the California Civil Code, which reads as follows: “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.” Executive expressly waives and relinquishes all rights and benefits under that section and any law of any jurisdiction of similar effect with respect to the releases hereunder.

(d) Additionally, while Executive acknowledges and understands that by this Agreement he foregoes, among other things, any and all past and present rights to recover money damages or personal relief arising out of Executive’s employment with the Company, the Parties

 

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agree that this Agreement shall not preclude Executive from filing any charge with the Equal Employment Opportunity Commission, the National Labor Relations Board, or any other governmental agency or from any way participating in any investigation, hearing, or proceeding of any government agency.

(e) The Company represents that, as of the time it executes this Agreement, it is not aware of any material claims that it may have against Executive.

5. Affirmations. Executive affirms that he has not filed or caused to be filed, and is not a party to any claim, complaint, or action against the Company or any of its subsidiaries or affiliates in any forum or form. Executive also affirms that he has no known workplace injuries or occupational diseases, and has been provided and has not been denied any leave requested under the Family and Medical Leave Act or any similar state law. Executive disclaims and waives any right of reinstatement with the Company or any subsidiary or affiliate thereof.

6. Restrictive Covenants. Executive acknowledges and agrees that any and all restrictive covenants to which he is subject, including, but not limited to, those contained in the Employee Assignment and Confidentiality Agreement and Section 15 of the Offer Letter, shall continue in effect in accordance with the terms and conditions thereof.

7. Consultation with Attorney; Voluntary Agreement. Executive acknowledges that (a) the Company has advised him of his right to consult with an attorney of his own choosing prior to executing this Agreement, (b) Executive has carefully read and fully understands all of the provisions of this Agreement, and (c) Executive is entering into this Agreement, including the provisions set forth in Section 4 hereof, knowingly, freely and voluntarily in exchange for good and valuable consideration.

8. Review and Revocation. Executive acknowledges that he has been given twenty-one (21) calendar days from April 5, 2015 to consider the terms of this Agreement, although he may sign it sooner. Executive agrees that any modifications, material or otherwise, made to this Agreement do not restart or affect in any manner the original twenty-one (21) calendar day consideration period. Executive shall have seven (7) calendar days from the date this Agreement is originally executed by Executive to revoke his consent to the terms of this Agreement. Such revocation must be in writing and sent via hand delivery or facsimile to the attention of the Company’s General Counsel, fax no: (415) 869-2841. Notice of such revocation must be received within the seven (7) calendar days referenced above. In the event of such revocation by Executive, this Agreement shall not become effective and Executive shall not have any rights to the Severance Benefits under this Agreement, and the accelerated vesting described in Section 2(d), Section 2(e) and Section 2(f) shall be void and such unvested equity awards shall be immediately forfeited by Executive. Provided that Executive does not revoke this Agreement within such seven (7) day period, this Agreement shall become effective on the eighth (8^th) calendar day after the date on which Executive signs it.

9. Notices. Any notice required or permitted to be given under this Agreement shall be in writing and shall be properly given if personally delivered, delivered by overnight courier of national reputation (e.g., FedEx or UPS) or sent by registered mail, return receipt requested, as follows:

 

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		To Company:		c/o Zynga Inc.
				699 Eighth Street
				San Francisco, CA 94103
				Attention: General Counsel
		To Executive:		Don Mattrick
				At address currently on the Company’s records

10. Governing Law. This Agreement shall be governed by and construed and enforced according to the laws of the State of California, without regard to conflicts of laws principles thereof.

11. Taxes. The Company may withhold from any amounts payable under this Agreement all federal, state, city or other taxes as the Company is required to withhold pursuant to any applicable law, regulation or ruling. The Parties agree that the equity awards set forth in Section 2(d), Section 2(e) and Section 2(f) of this Agreement shall each be subject to a ‘sell to cover’ transaction in respect of the minimum income tax required to be withheld by the Company. Notwithstanding any other provision of this Agreement, the Company shall not be obligated to guarantee any particular tax result for Executive with respect to any payment provided hereunder, and Executive shall be responsible for any taxes imposed on him with respect to any such payment.

12. Entire Agreement. This Agreement constitutes the entire understanding between the Parties with respect to the subject matter and supersedes, terminates, and replaces any prior or contemporaneous understandings or agreements with respect thereto.

13. Section 409A. It is intended that all of the benefits and payments under this Agreement satisfy, to the greatest extent possible, the exemptions from the application of Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”) provided under Treasury Regulations 1.409A-1(b)(4), 1.409A-1(b)(5) and 1.409A-1(b)(9), and this Agreement shall be construed to the greatest extent possible as consistent with those provisions. If not so exempt, this Agreement (and any definitions hereunder) shall be construed in a manner that complies with Section 409A, and incorporates by reference all required definitions and payment terms. For purposes of Section 409A (including, without limitation, for purposes of Treasury Regulation Section 1.409A-2(b)(2)(iii)), Executive’s right to receive any installment payments under this Agreement (whether severance payments, reimbursements or otherwise) shall be treated as a right to receive a series of separate payments and, accordingly, each installment payment hereunder shall at all times be considered a separate and distinct payment. Notwithstanding any provision to the contrary in this Agreement, if Executive is deemed by the Company at the time of Executive’s Separation from Service to be a “specified employee” for purposes of Section 409A(a)(2)(B)(i), and if any of the payments upon Separation from Service set forth herein and/or under any other agreement with the Company are deemed to be “deferred compensation”, then if delayed commencement of any portion of such payments is required to avoid a prohibited distribution under Code Section 409A(a)(2)(B)(i) and the related adverse taxation under Section 409A, the timing of the payments upon a Separation from Service shall be delayed as follows: on the earlier to occur of (i) the date that is six months and one day after the effective date of Executive’s Separation from Service, and (ii) the date of Executive’s

 

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death (such earlier date, the “Delayed Initial Payment Date”), the Company shall (A) pay to Executive a lump sum amount equal to the sum of the payments upon Separation from Service that Executive would otherwise have received through the Delayed Initial Payment Date if the commencement of the payments had not been delayed pursuant to this paragraph, and (B) commence paying the balance of the payments in accordance with the applicable payment schedules set forth above. No interest shall be due on any amounts so deferred.

14. Modifications. This Agreement may not be changed, amended, or modified unless done so in a writing signed by the Company and Executive.

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the Parties have executed this Agreement on the respective dates set forth below.

 

						Zynga Inc.
Dated:		4/8/2015				By:		/s/ John Doerr
						Name:		John Doerr
						Title:		Lead Independent Director
						Don Mattrick
Dated:		4/8/2015				/s/ Don Mattrick

 

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Exhibit 99.2

ZYNGA CEO DON MATTRICK TO DEPART; FOUNDER AND CHAIRMAN MARK PINCUS TO RETURN TO CHIEF EXECUTIVE OFFICER ROLE TO LEAD ZYNGA INTO NEXT CHAPTER

Zynga to Discuss First Quarter Financial Results on May 7, 2015 via Webcast

SAN FRANCISCO, Calif. – April 8, 2015 – Zynga Inc. (NASDAQ: ZNGA), a leading provider of social game services, today announced that current Chief Executive Officer Don Mattrick will depart the Company and the Board of Directors effective April 8, 2015. Mark Pincus, Zynga’s founder and chairman, will return to the role of Chief Executive Officer.

“Don joined us in a very important time in our evolution. I sincerely thank him for his leadership in better serving our players in a mobile first world and for delivering world class quality and value to our consumers,” said Mark Pincus. “The team’s hard work for our mobile players has resulted in bookings growing from 27% mobile bookings when Don joined to 60% by the end of last year. Further, to deliver unique and differentiated value to our mobile players, Don and the team acquired NaturalMotion. NaturalMotion has surprised and delighted the world with Clumsy Ninja and CSR Racing resulting in more than 160 million installs to date. I am inspired by our upcoming products – it is the most exciting slate of mobile games in Zynga’s history with titles like Empires & Allies, Dawn of Titans and FarmVille:Harvest Swap. These games are coming on the heels of one of the most successful mobile launches in our history with Wizard of Oz Slots, which was launched this past November by our Spooky Cool team in Chicago.”

Pincus continued, “Now that we are a mobile first company, it’s time to renew our focus on our founding mission to connect the world through games and our vision to make play and social games a mass market activity. I am returning to the company that I love in order to accelerate innovation in the most popular categories like Action Strategy and strengthen our focus on our core areas like Invest and Express. I look forward to partnering with our leaders to intensify our focus on social experiences for the millions of consumers who play our games.”

“When I joined the company in July 2013, Mark and I shared a vision of building a meaningful company that redefines entertainment in an increasingly mobile world. I am proud of the progress we have made together. I believe the timing is now right for me to leave as CEO and let Mark lead the company into its next chapter given his passion for the founding vision and his ability to couple our mobile progress with Zynga’s unique strengths. As a company, Zynga is in a stronger position today to serve mobile consumers and take advantage of the unprecedented growth opportunity across our industry. I am excited about the company’s trajectory and wish the best for Mark, Zynga and NaturalMotion as I plan to return to Canada to pursue my next challenge,” said Don Mattrick.

“Q1 was a strong quarter and we are confident in the outlook we gave during our Q4 2014 earnings call on February 12, 2015. Our teams are heads down and focused on our mobile-first product slate and we will be sharing details related to our product progress and financial performance during our Q1 earnings call on May 7, 2015,” said David Lee, Chief Financial Officer, Zynga.

At his request, Pincus will receive an annual salary of $1 in connection with his appointment to Chief Executive Officer.

First Quarter Conference Call

Zynga will hold a conference call to discuss financial results for its first quarter on Thursday, May 7, 2015 at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time), following the release of its financial results after the close of market. The live webcast of Zynga’s earnings conference call can be accessed at investor.zynga.com. Following the call, a replay of the webcast will be available through the website.

Mark Pincus Biographical Information

Mark Pincus is the Founder, Chief Executive Officer and Chairman of the Board of Directors at Zynga.

Pincus founded Zynga in 2007 and pioneered the social gaming industry, helping redefine entertainment and bring gaming to the mainstream. Since its founding, more than one billion people around the world have played and connected through Zynga games, and franchises including FarmVille and Words With Friends have become a part of people’s daily lives.

Pincus also founded Zynga.org in 2009, a nonprofit organization dedicated to using social games for social good. To-date, Zynga.org has raised more than $20 million by connecting millions of players with more than 50 nonprofit organizations around the world. In 2013, Zynga.org partnered with NewSchools Venture Fund to create co.lab, an education technology accelerator focused on enhancing the quality and reach of learning games and apps.

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Pincus has pursued his passion for creating Internet products since 1995, when he founded FreeLoader, the first web-based push company. Later, he founded Support.com, a pioneer in automating tech support, and took it public. Then, in 2003, he launched Tribe.net, one of the first social networks. Pincus most recently founded superlabs in 2014, a San Francisco-based product lab focused on developing products that connect and empower people.

He graduated summa cum laude from University of Pennsylvania’s Wharton School of Business and earned an MBA from Harvard Business School. He is an angel investor in multiple Silicon Valley startups and made founding investments in Napster, Twitter and Facebook.

About Zynga Inc.

Zynga Inc. is a leading developer of the world’s most popular social games that are played by millions of monthly consumers. The company has created evergreen franchises such as FarmVille, Zynga Casino and Words With Friends. Zynga’s NaturalMotion, an Oxford-based mobile game and technology developer, is the creator of hit mobile games in popular entertainment categories, including CSR Racing, CSR Classics and Clumsy Ninja. Zynga games have been played by more than 1 billion people around the world and are available on a number of global platforms including Apple iOS, Google Android, Facebook and Zynga.com. The company is headquartered in San Francisco, California. Learn more about Zynga at http://blog.zynga.com or follow us on Twitter and Facebook.

Press Contacts:

Dani Dudeck, Zynga

[email protected]

Stephanie Hess, Zynga

[email protected]

Investor Relations Contact:

Eric Bylin, NMN Advisors

[email protected]

Forward-Looking Statement

This press release contains forward looking statements relating to, among other things, our expectations for first quarter financial results the appointment of Mark Pincus as our new Chief Executive Officer, the resignation of Don Mattrick from his position as Chief Executive Officer and from his seat on our Board of Directors, our future operational plans, strategies and prospects, the strength of our future games slate, including our planned launch of mobile first games including games in the Action Strategy category, our ability to grow mobile bookings, our ability to accelerate innovation and execute against our strategy and deliver long term value for our shareholders, consumers and employees, our ability to build on our social legacy in both our web games and our new mobile games and our ability to take advantage of the growth opportunity across our industry. Forward-looking statements often include words such as “outlook,” “projected,” “intends,” “will,” “anticipate,” “believe,” “target,” “expect,” and statements in the future tense are generally forward-looking. The achievement or success of the matters covered by such forward-looking statements involves significant risks, uncertainties, and assumptions. Our actual results could differ materially from those predicted or implied and reported results should not be considered as an indication of our future performance. Factors that could cause or contribute to such differences include, but are not limited to, our relationship and or agreements with key partners, including platform partners, our ability to launch and monetize new games in a timely fashion, our ability to address technical challenges as they may arise, competition, the changing interest of players, intellectual property disputes or other litigation, our ability to retain key employees and retain and attract new talent and our ability to work as a team to execute against our strategy, acquisitions by us, and changes in corporate strategy or management.

More information about factors that could affect our operating results is included under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Quarterly Report on Form 10-Q for the three months ended September 30, 2014 and in our Annual Report on Form 10-K for the year ended December 31, 2014, copies of which may be obtained by visiting our Investor Relations web site at http://investor.zynga.com or the SEC’s web site at www.sec.gov. Undue reliance should not be placed on the forward-looking statements in this release, which are based on information available to us on the date hereof. There is no guarantee that the circumstances described in our forward-looking statements will occur. We assume no obligation to update such statements. The financial results we report in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 could differ materially from the outlook we provided on our Q4 Earnings Call, due to, among other things, the fact that the Company has not yet closed its books for the quarter, and frequently makes accounting adjustments during the quarterly close process.

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