Item 1.01 Entry into a Material Definitive Agreement.
Transaction Agreement
On April 2, 2023, Endeavor Group Holdings, Inc., a Delaware corporation (the
"Company" or "Endeavor"), entered into a Transaction Agreement (the "Transaction
Agreement"), by and among the Company, Endeavor Operating Company, LLC, a
Delaware limited liability company and subsidiary of the Company ("EOC"), Zuffa
Parent, LLC, a Delaware limited liability company and a subsidiary of EOC
("HoldCo"), World Wrestling Entertainment, Inc., a Delaware corporation ("WWE"),
New Whale Inc., a Delaware corporation and a wholly owned subsidiary of WWE
("New PubCo"), and Whale Merger Sub Inc., a Delaware corporation and wholly
owned subsidiary of New PubCo ("Merger Sub"), pursuant to which, among other
things, Endeavor and WWE agreed to combine the businesses of HoldCo, which owns
and operates the Ultimate Fighting Championship ("UFC"), and WWE. All defined
terms used in this summary of the Transaction Agreement that are not otherwise
defined herein have the meanings ascribed to such terms in the Transaction
Agreement.
Pursuant to the Transaction Agreement, among other things, and subject to the
satisfaction or waiver of the conditions set forth therein, (i) WWE will
undertake certain internal restructuring steps as further described in the
Transaction Agreement (collectively, the "Pre-Closing Reorganization"); (ii)
following the Pre-Closing Reorganization, Merger Sub will merge with and into
WWE (the "Merger"), with WWE surviving the Merger (the "Surviving Entity") and
becoming a direct wholly owned subsidiary of New PubCo - as a result of the
Merger (x) each outstanding share of WWE's Class A common stock, par value $0.01
per share (the "WWE Class A Common Stock") and (y) each outstanding share of
WWE's Class B common stock, par value $0.01 per share (the "WWE Class B Common
Stock," and together with the WWE Class A Common Stock, the "WWE Common Stock")
that is outstanding immediately prior to the effective time of the Merger (the
"Effective Time"), but excluding any Cancelled WWE Shares, will, in each case,
be converted automatically into the right to receive one share of New PubCo
Class A common stock, par value $0.00001 per share (the "New PubCo Class A
Common Stock"); (iv) immediately following the Merger, New PubCo will cause the
Surviving Entity to be converted into a Delaware limited liability company ("WWE
LLC") and New PubCo will become the sole managing member of WWE LLC (the
"Conversion"); and (v) following the Conversion, New PubCo will (x) contribute
all of the equity interests of WWE LLC to HoldCo in exchange for 49% of the
membership interests in HoldCo on a fully-diluted basis (as further described in
the Transaction Agreement), and (y) issue to EOC and certain of Endeavor's other
subsidiaries a number of shares of New PubCo Class B common stock, par value
$0.00001 per share (the "New PubCo Class B Common Stock") representing, in the
aggregate, 51% of the total voting power of New PubCo stock on a fully-diluted
basis, in exchange for a payment equal to the par value of such New PubCo
Class B Common Stock, in each case of the foregoing clauses (i) through (v), on
the terms and subject to the conditions set forth in the Transaction Agreement
(the transactions described in the foregoing, collectively, the "Transactions").
At the Effective Time, (i) each award of WWE Restricted Stock Units (each, an
"RSU") outstanding immediately prior to the Effective Time will be converted
into an award of restricted stock units, on the same terms and conditions as
were applicable under the award of RSUs immediately prior to the Effective Time
(including any provisions for acceleration), with respect to a number of shares
of New PubCo Class A Common Stock equal to the number of shares of WWE Class A
Common Stock subject to such award of RSUs, (ii) each award of WWE Performance
Stock Units (each, a "PSU") outstanding immediately prior to the Effective Time
will be converted into an award of performance stock units, on the same terms
and conditions as were applicable under the award of PSUs immediately prior to
the Effective Time (including any provisions for acceleration), with respect to
a number of shares of New PubCo Class A Common Stock equal to the number of
shares of WWE Class A Common Stock subject to such award of PSU; provided,
however, that the applicable performance-vesting conditions will be equitably
adjusted, including by the WWE Compensation Committee prior to the closing of
the Transactions (the "Closing"), to take into account the effects, if any, of
the Merger and the Conversion.
Pursuant to the Transaction Agreement, WWE agreed to use its reasonable best
efforts to cause the New PubCo Class A Common Stock to be registered pursuant to
Section 12(b) of the Exchange Act and approved for listing on the New York Stock
Exchange, subject to official notice of issuance, and have reserved the ticker
"TKO." Upon closing of the Transactions, among other things, Endeavor and its
subsidiaries will own 51% of the fully-diluted voting power of New PubCo and 51%
of the fully-diluted economic ownership in HoldCo, with stockholders of WWE
effectively owning 49% of the fully-diluted economic ownership in HoldCo, 49% of
the fully-diluted voting power of New PubCo and 100% of the fully-diluted
economic ownership of New PubCo. Effective as of immediately following the
Closing, New PubCo is expected to be a consolidated subsidiary of Endeavor.
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New PubCo Board of Directors and Leadership Team
New PubCo is expected to be led by Ariel Emanuel (Chief Executive Officer), who
is expected to also continue in his role as Chief Executive Officer of Endeavor;
Vincent K. McMahon ("the "Stockholder"), who is expected to serve as Executive
. . .
Item 2.02 Results of Operations and Financial Condition.
The Company's financial results included under Item 7.01 of this Current Report
on Form 8-K (including Exhibits 99.2 and 99.3 hereto) is incorporated herein by
reference.
The information in this Item 2.02 of this Current Report on Form 8-K (including
Exhibits 99.1, 99.2 and Exhibit 99.3 hereto) shall not be deemed "filed" for
purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or otherwise subject to the liabilities of that section, nor
shall it be deemed incorporated by reference in any filing under the Securities
Act of 1933, as amended (the "Securities Act"), or the Exchange Act, except as
expressly set forth by specific reference in such a filing.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory.
On April 2, 2023, Mark Shapiro, the Company's President, was also appointed as
the Company's Chief Operating Officer. Mr. Shapiro's biographical information
and any relationship required to be disclosed under Regulation S-K Item 404 is
disclosed in the Company's definitive proxy statement filed with the SEC on
April 29, 2022 and is incorporated herein by reference.
Item 7.01 Regulation FD Disclosure.
On April 3, 2023, Company issued a press release announcing the transaction, a
copy of which is attached hereto as Exhibits 99.1 and announced that it will be
hosting a webcast at 8:00 a.m., Eastern Time, April 3, 2023 to discuss the
Transactions. The event and accompanying presentation materials, copies of which
are also attached as Exhibits 99.2 and 99.3 hereto, can be accessed at
investor.endeavorco.com.
The information contained under this Item 7.01 of this Current Report on Form
8-K (including Exhibits 99.1, 99.2 and 99.3 hereto), shall not be deemed "filed"
for purposes of Section 18 of the Exchange Act, or otherwise subject to the
liabilities of that section, nor shall it be deemed incorporated by reference in
any filing under the Securities Act or the Exchange Act except as may be
expressly set forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
No. Description
2.1* Transaction Agreement, dated April 2, 2023, by and among Endeavor
Group Holdings, Inc., Endeavor Operating Company, LLC, Zuffa Parent,
LLC, World Wrestling Entertainment, Inc., New Whale Inc., and Whale
Merger Sub Inc.
10.1 Stockholders Agreement, dated April 2, 2023, by and between Endeavor
Group Holdings, Inc. and Vincent K. McMahon.
99.1 Press Release, dated April 3, 2023.
99.2 Investor Presentation, dated April 3, 2023.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
* Certain schedules have been omitted pursuant to Item 601(a)(5) of Regulation
S-K. The Company undertakes to furnish supplemental copies of any of the
omitted schedules upon request by the SEC.
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Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. These forward-looking statements generally
include statements regarding the potential transaction between Endeavor Group
Holdings, Inc. ("Endeavor") and WWE ("WWE"), including statements regarding the
expected timetable for completing the Transactions, the ability to complete the
Transactions, expected synergies, impacts and benefits of the Transactions, the
expected leadership team of New PubCo, the projected financial information,
future opportunities, expected cash distributions and other statements regarding
New PubCo's and WWE's future expectations, beliefs, plans, objectives, results
of operations, financial condition and cash flows, or future events or
performance. Statements that do not relate to matters of historical fact should
be considered forward-looking statements, including, without limitation, the
expected market opportunity, growth, financial performance, expected synergies
and closing of the Transactions. All statements other than statements of
historical facts contained in this communication may be forward-looking
statements. In some cases, you can identify forward-looking statements by terms
such as "may," "will," "outlook", "should," "expects," "plans," "anticipates,"
"could," "intends," "targets," "projects," "contemplates," "believes,"
"estimates," "predicts," "potential" or "continue" or the negative of these
terms or other similar expressions. The forward-looking statements in this
communication are only predictions. Endeavor's management has based these
forward-looking statements largely on their current expectations and projections
about future events and financial trends that management believes may affect its
business, financial condition and results of operations. These statements are
neither promises nor guarantees and involve known and unknown risks,
uncertainties and other important factors that may cause actual results,
performance or achievements to be materially different from what is expressed or
implied by the forward-looking statements, including, but not limited to: the
transaction will not be consummated; there may be difficulties with the
integration and in realizing the expected benefits of the transaction; Endeavor
and WWE may need to use resources that are needed in other parts of its business
to do so; there may be liabilities that are not known, probable or estimable at
this time; the transaction may result in the diversion of management's time and
attention to issues relating to the transaction and integration; expected
synergies and operating efficiencies attributable to the transaction may not be
achieved within its expected time-frames or at all; there may be significant
transaction costs and integration costs in connection with the transaction; the
possibility that neither WWE nor Endeavor will have sufficient cash at close to
distribute to shareholders (or that the amount of cash available for
distribution will be less than what the parties expect); unfavorable outcome of
legal proceedings that may be instituted against WWE and Endeavor following the
announcement of the transaction; and risks inherent to the business may result
in additional strategic and operational risks, which may impact Endeavor's risk
profile and it may not be able to mitigate effectively. In addition, a number of
important factors could cause Endeavor's or New PubCo's actual future results
and other future circumstances to differ materially from those expressed in any
forward-looking statements, including but not limited to those important factors
discussed in Part I, Item 1A "Risk Factors" in Endeavor's Annual Report on Form
10-K for the fiscal year ended December 31, 2022, as any such factors may be
updated from time to time in its other filings with the SEC, accessible on the
SEC's website at www.sec.gov, Endeavor's investor relations site at
investor.endeavorco.com and WWE's investor relations site at investor.wwe.com.
Forward-looking statements speak only as of the date they are made and, except
as may be required under applicable law, neither Endeavor nor WWE undertakes no
obligation to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise.
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Important Information for Investors and Stockholders
This Current Report on Form 8-K does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of any vote or
approval, nor shall there be any issuance or sale of securities in any
jurisdiction in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such
jurisdiction. No offer of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities Act. In
connection with the transaction, New PubCo expects to file a registration
statement on Form S-4 with the SEC, which will include an information statement
of WWE and a preliminary prospectus of New PubCo. After the registration
statement is declared effective, WWE will mail to its stockholders a definitive
information statement that will form part of the registration statement on Form
S-4. This communication is not a substitute for any other document that Endeavor
may file with the SEC and send to its stockholders in connection with the
transaction. INVESTORS AND SECURITY HOLDERS OF ENDEAVOR ARE URGED TO READ ANY
OTHER DOCUMENTS THAT WILL BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY
WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.
Investors and security holders will be able to obtain free copies of the
information statement/prospectus (when available) and other documents filed with
the SEC by Endeavor through the website maintained by the SEC at
http://www.sec.gov. Copies of the documents filed with the SEC by Endeavor will
be available free of charge on Endeavor's website at
http://www.investor.endeavorco.com.
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ENDEAVOR GROUP HOLDINGS, INC. 
