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New Zynga CEO Don Mattrick paid millions to leave Microsoft job

July 4, 2013
Don Mattrick, the new CEO of struggling Web game maker Zynga Inc was paid millions to leave his job at Microsoft Corporation.

Mattrick was overseeing the Xbox console for video games as the president of Interactive Entertainment Business at Microsoft.

According to a regulatory filing made late on Wednesday, Zynga Inc announced Mattrick replaced company co-founder Mark Pincus as CEO earlier this week, when it didn't detail how much he would be paid.

Pincus will remain the San Francisco-based company's chairman and chief product officer.

Mattrick secured his lucrative deal with the company just a few weeks after the company laid off more than 500 employees, or nearly one-fifth of its payroll, to save money.

Apart from a $5 million signing bonus and stock awards valued at $40 million, Mattrick's compensation package also includes a $1 million annual salary and a guaranteed bonus of about $1 million this year.

The maker of once-popular games such as 'Farmville' gave Mattrick 8.9 million shares of restricted stock initially valued at $25 million to make up for some of the compensation he surrendered by leaving Microsoft. Those shares are already worth slightly more on paper, but they won't vest until July 2016, according to the regulatory filing.

As an additional enticement, Zynga is giving Mattrick another 1.8 million shares of its restricted stock valued at $5 million. Mattrick also gets 7.36 million stock options valued at $10 million.

Zynga is counting on Mattrick, 49, to reverse a steady string of losses that has caused the company's stock price to plunge 66 per cent from its initial public offering price of $10 in late 2011.

As the former Microsoft employee draws up the turnaround strategy, he will still be working closely with Pincus, who holds a controlling stake in Zynga.

The company promised to enrich Mattrick even further next year with another batch of restricted stock valued at $7 million and a cash bonus ranging from $2 million to $4 million.

Associated Press

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