ZYNGA INC. Item 1.01 Entry into a Material Definitive Agreement
Agreement and Plan of Merger
On
As a result of the Combination, (i) each issued and outstanding share of Class A
Common stock of Zynga, par value
The Merger Agreement also provides that at the effective time of the Merger (the "Effective Time"), (i) issued and outstanding options to purchase Zynga Common Stock will be assumed by Take-Two and automatically converted into options exercisable for shares of Take-Two Common Stock (the "Converted Options"), (ii) each issued and outstanding restricted stock unit award covering Zynga Common Stock will be assumed by Take-Two and automatically converted into a Take-Two restricted share unit award covering shares of Take-Two Common Stock (the "Converted RSUs"), and (iii) each issued and outstanding performance stock unit award covering Zynga Common Stock will be assumed by Take-Two and automatically converted into a Take-Two restricted share unit award covering a number of shares of Take-Two Common Stock determined based on the number of shares of Zynga Common Stock subject to the award immediately prior to the Effective Time as determined in accordance with the requirements of the applicable Zynga award agreement (the "Converted PSUs" and, together with the Converted Options, and the Converted RSUs, the "Converted Awards"), in each case with the number of shares (and exercise price, with respect to Converted Options) adjusted based on an exchange ratio that is intended to maintain the intrinsic value of the award immediately prior to the Effective Time. Following the Effective Time, the Converted Awards will vest based on continued service and will continue to be governed by substantially the same terms and conditions as were applicable to the corresponding Zynga equity awards immediately prior to the Effective Time.
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The Merger Agreement contains customary representations, warranties and covenants made by each of Zynga and Take-Two, including, among others, covenants by each of Zynga and Take-Two to (i) continue conducting its respective businesses in the ordinary course, consistent with past practice during the interim period between the execution of the Merger Agreement and consummation of the Combination, (ii) not engage in certain specified kinds of transactions during that period and (iii) unless the Merger Agreement is validly terminated, hold a meeting of its stockholders to vote upon, in the case of Zynga's stockholders, the approval and adoption of the Merger Agreement and the Combination, and, in the case of Take-Two's stockholders, the approval of both the issuance of the Stock Consideration and the adoption of an amendment to Take-Two's Amended and Restated Certificate of Incorporation increasing the number of authorized shares of Take-Two Common Stock (the "Take-Two Charter Amendment").
Pursuant to the terms of a "go-shop" provision in the Merger Agreement, during
the period beginning on the date of the Merger Agreement and continuing until
In connection with the closing of the Combination, Take-Two has agreed to expand the size of its board of directors from eight to ten directors, and to appoint two of Zynga's current directors to the Board as designated by Zynga and approved by Take-Two.
The closing of the Combination is subject to certain conditions, including . . .
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
On
The foregoing summary of the amendment to Zynga's bylaws does not purport to be complete and is qualified in its entirety by reference to the full text of such amendment, a copy of which is attached to this Form 8-K as Exhibit 3.1 and incorporated in this Item 5.03 by reference.
Item 8.01. Other Items.
On
Forward-Looking Statements
Statements contained herein which are not historical facts may be considered forward-looking statements under federal securities laws and may be identified by words such as "anticipates," "believes," "estimates," "expects," "intends," "plans," "potential," "predicts," "projects," "seeks," "should," "will," or words of similar meaning and include, but are not limited to, statements regarding the proposed business combination of Take-Two and Zynga and the outlook for Take-Two's or Zynga's future business and financial performance. Such forward-looking statements are based on the current beliefs of Take-Two's and Zynga's respective management as well as assumptions made by and information currently available to them, which are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Actual outcomes and results may vary materially from these forward-looking statements based on a variety of risks and uncertainties including: the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; the inability to obtain Take-Two's or Zynga's respective stockholder approval or the failure to satisfy other conditions to completion of the proposed combination, including receipt of regulatory approvals, on a timely basis or at all; risks that the proposed combination disrupts each company's current plans and operations; the diversion of the attention of the respective
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management teams of Take-Two and Zynga from their respective ongoing business
operations; the ability of either Take-Two, Zynga or the combined company to
retain key personnel; the ability to realize the benefits of the proposed
combination, including net bookings opportunities and cost synergies; the
ability to successfully integrate Zynga's business with Take-Two's business or
to integrate the businesses within the anticipated timeframe; the outcome of any
legal proceedings that may be instituted against Take-Two, Zynga or others
following announcement of the proposed combination; the amount of the costs,
fees, expenses and charges related to the proposed combination; the uncertainty
of the impact of the COVID-19 pandemic and measures taken in response thereto;
the effect of economic, market or business conditions, including competition,
consumer demand and the discretionary spending patterns of customers, or changes
in such conditions, have on Take-Two's, Zynga's and the combined company's
operations, revenue, cash flow, operating expenses, employee hiring and
retention, relationships with business partners, the development, launch or
monetization of games and other products, and customer engagement, retention and
growth; the risks of conducting Take-Two's and Zynga's business internationally;
the impact of changes in interest rates by the
Other important factors and information are contained in Take-Two's and Zynga's
most recent Annual Reports on Form 10-K, including the risks summarized in the
section entitled "Risk Factors," Take-Two's and Zynga's most recent Quarterly
Reports on Form 10-Q, and each company's other periodic filings with the
Additional Information and Where to Find It
This communication relates to a proposed business combination of Take-Two and
Zynga that will become the subject of a registration statement on Form S-4 to be
filed by Take-Two with the
Participants In The Solicitation
Take-Two, Zynga and their respective directors and executive officers may be
deemed to be participants in any solicitation of proxies in connection with the
proposed business combination. Information about Take-Two's directors and
executive officers is available in Take-Two's proxy statement dated
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Item 9.01. Financial Statements and Exhibits
(d) Exhibits EXHIBIT NO. Description 2.1* Agreement and Plan of Merger, dated as ofJanuary 9, 2022 , by and among Take-Two Interactive Software, Inc.,Zynga Inc. ,Zebra MS I, Inc. , andZebra MS II, Inc. 3.1 First Amendment to Zynga's Fifth Amended and Restated Bylaws 10.1 Form of Zynga Voting Agreement 10.2 Form of Zynga Voting Agreement 10.3 Form of Take-Two Voting Agreement 99.1 Press Release of Take-Two and Zynga, datedJanuary 10, 2022 104 Cover Page Interactive Data File (the cover page XBRL tags are embedded within the inline XBRL document)
* Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. A
copy of any omitted schedule will be furnished supplementally to the
parties may request confidential treatment pursuant to Rule 24b-2 of the
Exchange Act for any document so furnished.
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