ZNGA Zynga Inc

 

 

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

July 8, 2014

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.

Election of Director

On July 9, 2014, the Board of Directors (the “Board”) of Zynga Inc. (the “Company”) elected, upon the recommendation of the Nominating and Corporate Governance Committee of the Board (the “Nominating Committee”), Regina E. Dugan to serve as a member of the Board. Immediately prior to Ms. Dugan’s election, the size of the Board was increased from seven (7) to eight (8) directors. Upon her election to the Board and upon the recommendation of the Nominating Committee, Ms. Dugan was also appointed as Chair of the Nominating Committee and as a member of the Product Committee of the Board.

In accordance with the Company’s current non-employee director compensation policy, a copy of which is attached hereto as Exhibit 10.1 and incorporated by reference herein, Ms. Dugan will be entitled to receive compensation for her service as a member of the Board and committees thereof.

There are no arrangements or understandings between Ms. Dugan and any other persons pursuant to which she was elected as a director of the Company. There are no family relationships between Ms. Dugan and any director, executive officer, or any person nominated or chosen by the Company to become a director or executive officer. Ms. Dugan is not a party to any current or proposed transaction with the Company for which disclosure is required under Item 404(a) of Regulation S-K. The Company has also entered into its standard form of indemnification agreement with Ms. Dugan.

A copy of the press release announcing Ms. Dugan’s election to the Board is attached as Exhibit 99.1 to this current report on Form 8-K and is incorporated by reference herein.

Item 8.01. Other Events

Company Regains NASDAQ Compliance

On July 9, 2014, Ms. Dugan joined L. John Doerr, Stanley J. Meresman, Sunil Paul and Ellen Siminoff as an “independent” member of the Board. The Board has affirmatively determined that Ms. Dugan, Mr. Doerr, Mr. Meresman, Mr. Paul and Ms. Siminoff are “independent directors” pursuant to Rule 5605(b)(1) of the NASDAQ Stock Market LLC (“NASDAQ”) listing rules, and as a result, the Board is comprised of a majority of independent directors, as defined by the NASDAQ listing rules. Therefore, the Company has regained compliance with the NASDAQ listing rules.

CEO Vesting Event

On July 8, 2014, Don Mattrick, the Company’s Chief Executive Officer, vested in 4,046,428 restricted stock units (“ZSUs”) as a result of the first anniversary of his start date with the Company. Each ZSU represents a contingent right to receive one share of the Company’s Class A Common Stock.

The Company sold shares of Class A Common Stock issued to Mr. Mattrick upon the vesting to satisfy the Company’s statutory tax withholding obligations in connection with the vesting of the ZSUs. This automatic sale is pursuant to the Company’s election under its equity incentive plans to require the satisfaction of minimum statutory tax withholding obligations to be funded by a “sell to cover” transaction and does not represent a discretionary sale by Mr. Mattrick. Mr. Mattrick has not sold shares of Zynga other than in connection with this mandated tax sale.

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Item 9.01. Financial Statements and Exhibits

 

(d)

Exhibits.

 

Exhibit No.		Description
10.1		Non-Employee Director Compensation Policy, as amended
99.1		Press release announcing election of Regina E. Dugan as a director of the Board, dated July 9, 2014.

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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: July 9, 2014		By:		/s/ Devang Shah
				Devang Shah
				General Counsel, Secretary and Vice President

Exhibit 10.1

ZYNGA INC.

NON-EMPLOYEE DIRECTOR COMPENSATION POLICY

AS AMENDED JULY 9, 2014

On January 18, 2012, the Compensation Committee (the “Compensation Committee”) of the Board of Directors (the “Board”) of Zynga Inc. (the “Company”) initially approved the following compensation policy (the “Policy”) for non-employee directors of the Company, effective retroactive to January 1, 2012, and this policy is further amended as of the date set forth above. For purposes of this Policy, a “Non-Employee Director” is a director who is not serving as an employee or executive officer of the Company or its affiliates (even if such individual may be otherwise be providing services to the Company or its affiliates in a capacity other than as a director).

Each Non-Employee Director will be eligible to receive compensatory equity awards under the Company’s 2011 Equity Incentive Plan (the “Plan”) as consideration for service on the Board. All grants under this Policy will be made automatically in accordance with the terms of this Policy and the Plan, without the need for any additional corporate action by the Board or the Compensation Committee of the Board. Vesting of all equity awards granted under this Policy is subject to the Non-Employee Director’s “Continuous Service” (as defined in the Plan) from the date of grant through each applicable vesting date. Each equity award granted under this Policy will be subject to the Company’s standard form of Restricted Stock Unit Agreement, as most recently adopted by the Board for use under this Policy.

Annual Equity Award. Each year, on the date of the regular annual meeting of the Company’s stockholders (the “Annual Meeting”), the Company will automatically grant each continuing Non-Employee Director who is re-elected at such meeting, restricted stock units of Class A Common Stock (“RSUs”, collectively, the “Annual Equity Award”) with an aggregate value on the date of grant equal to the Base Annual Retainer plus, with respect to the Chairperson of the Audit Committee, an Audit Committee Retainer, as set forth in the table below (the “Audit Committee Retainer”). The Annual Equity Award will vest as follows: 25% will vest every three months from the date of grant, with the last quarterly vesting installment taking place upon the earlier of: (i) the day prior to the one-year anniversary of such Annual Meeting or (ii) the date of the next Annual Meeting, subject to continued service through each such date.

Pro-Rated Annual Equity Award for New Non-Employee Directors. If an individual first becomes a Non-Employee Director other than at an Annual Meeting, the Company will automatically grant such new Non-Employee Director, on the date that he or she is first elected or appointed to the Board, restricted stock units of Class A Common Stock with an aggregate value on the date of grant equal to the pro rata portion of the Annual Equity Grant, which pro rata portion reflects a reduction for each month prior to the date of grant that has elapsed since the preceding Annual Meeting (the “Pro-Rated Annual Equity Award”).

Product Committee. Each year on the date of the Annual Meeting, the Company will automatically grant each Non-Employee Director who is re-elected at such meeting and is a member of the Product Committee, a retainer comprised of, at the election of such non-employee director and Product Committee Member, cash, RSUs or a combination of cash and RSUs with an aggregate value equal to the amount set forth in the table below (the “Product Committee Retainer” and, together with the Audit Committee Retainer, the “Committee Retainers” and each a “Committee Retainer”). The Product Committee Retainer, whether comprised of cash, RSUs or a combination of cash and RSUs, will vest as follows: 25% will vest every three months from the date of the Annual Meeting, with the last quarterly vesting installment taking place upon the earlier of: (i) the day prior to the one-year anniversary of the Annual Meeting or (ii) the date of the next Annual Meeting, subject to continued service through each such date. If an individual who is not an employee of the Company is appointed to the Product Committee on a date other than at an Annual Meeting, the Company will automatically grant such new non-employee member of the Product Committee, on the date that he or she is first elected or appointed to the Product Committee, a Product Committee Retainer equal to the amount set forth in the table below. If an

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individual who is not an employee of the Company is appointed to the Product Committee more than three (3) months after the date of the Annual Meeting, such individual will be granted a pro rated Product Committee Retainer, which pro rata retainer reflects a reduction for each month prior to the date of grant that has elapsed since the preceding Annual Meeting; provided that the Compensation Committee shall have the discretion to adjust the amount of any pro-rated grant up to the full value of the Product Committee Retainer if it determines that such adjustment is in the best interest of the Company and its stockholders.

Board Compensation¹

 

Base Annual Retainer		$	250,000
Committee Retainer For Serving as Chairperson of the Audit Committee		$	50,000
Committee Retainer For Service as Member of the Product Committee		$	250,000

 

1	The number of RSUs granted will be equal to (i) the applicable dollar value set forth above, divided by (ii) the Fair Market Value (as defined in the Plan) of the Class A common stock of the Company on the date of grant.

Expense Reimbursement. All Non-Employee Directors will be entitled to reimbursement from the Company for their reasonable travel (including airfare and ground transportation), lodging and meal expenses incident to meetings of the Board or committees thereof. The Company will also reimburse directors for attendance at director continuing education programs that are relevant to their service on the Board and which attendance is pre-approved by the Chair of the Nominating and Corporate Governance Committee or Chair of the Board. The Company will make reimbursement to a Non-Employee Director within a reasonable amount of time, but not more than 12 months, following submission by the Non-Employee Director of reasonable written substantiation for the expenses consistent with the Company’s reimbursement policy.

Exhibit 99.1

ZYNGA APPOINTS REGINA DUGAN TO BOARD OF DIRECTORS

John Doerr Appointed Lead Independent Director of Zynga’s Board of Directors

SAN FRANCISCO – July 9, 2014 – Zynga Inc. (Nasdaq: ZNGA), a leading social game developer, today announced that Dr. Regina E. Dugan, Vice President of Engineering and leader of the Advanced Technology and Projects (ATAP) group at Google Inc., joined the company’s Board of Directors.

“I have admired Regina’s work and visionary thinking for years and believe she will be an incredible addition to the Zynga Board of Directors and a true catalyst for creative thinking at Zynga,” said Don Mattrick, CEO of Zynga. “Regina is a dynamic leader who embraces new ideas and inspires teams to reimagine how technology and tools can positively disrupt the world. As we focus on growing and sustaining our leading franchises and creating new hits, Regina’s expertise and counsel will put us in a better position to deliver consumers next generation entertainment experiences that span categories, platforms and devices.”

“I believe we need to play. Zynga is full of creative thinkers who embrace the power of play. Einstein famously stated that ‘combinatory play seems to be the essential feature in productive thought,’ and this spirit is embodied in Zynga’s products, which have brought new technology to games. Games that help people connect, share, rest and energize through play. I look forward to working with Don and the board on the company’s next chapter,” said Regina Dugan.

Google’s ATAP group is charged with creating breakthrough innovations in mobile computing and accelerating the development of promising technologies to market. From May 2012 until February 2014, Dr. Dugan was Senior Vice President and a member of the Senior Leadership Team at Motorola Mobility. In February 2014, ATAP transitioned to Google’s Android, Chrome & Apps product area.

Previously, Dr. Dugan served as the 19th Director and first female leader of the Defense Advanced Research Projects Agency (DARPA), the principal agency within the U.S. Department of Defense for research, development and demonstration of high-risk, high-payoff capabilities for the future combat force. DARPA’s long list of breakthrough achievements includes the Internet, stealth technology, and GPS. As Director, Dr. Dugan advanced strategic initiatives in cyber security, hypersonics, social media, and advanced manufacturing.

In her career, Dr. Dugan has been widely recognized for her leadership in innovation and technology development, and has received numerous accolades including being named “Tech Titan” by Washingtonian Magazine, to “The Verge 50” list, as well as Fast Company’s “Most Creative People in Business 1000” and CNN’s “Top 10 Thinkers.”

Dr. Dugan obtained her doctoral degree in mechanical engineering from the California Institute of Technology and her master’s and bachelor’s degrees from Virginia Tech. In 2013, she was inducted into the Virginia Tech College of Engineering’s Academy of Engineering Excellence. She is the co-author of the 1996 book Engineering Thermodynamics, and the sole inventor or co-inventor of multiple patents and patents pending.

Zynga’s distinguished board members include Mark Pincus, Don Mattrick, William “Bing” Gordon and independent Directors Dr. Regina E. Dugan, Stanley J. Meresman, Sunil Paul, Ellen F. Siminoff and John Doerr, who was recently appointed by the Board as lead independent Director.

On Zynga’s Board, Dr. Dugan will chair the Nominating and Governance Committee and become a member of the Product Committee alongside members including Don Mattrick, Bing Gordon and Mark Pincus. In addition to her leadership role at Google, Dr. Dugan, 51, also serves on the Board of Directors of Varian Medical Systems, Inc. (NYSE: VAR).

About Zynga Inc.

Zynga Inc. is a leading developer of the world’s most popular social games that are played by more than 100 million 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, Calif. Learn more about Zynga at http://blog.zynga.com or follow us on Twitter and Facebook.

Contacts

Zynga

Stephanie Hess

shess@zynga.com

Kelly Pakula Kunz

kpakula@zynga.com