Summary
Take-Two Interactive Software, Inc. (TTWO) filed an 8-K on November 18, 2013, reporting a material definitive agreement. The company, through its Board of Directors' approval, entered into an amendment to a Non-Qualified Stock Option Agreement originally established in August 2007 with ZelnickMedia Corporation. This amendment allows ZelnickMedia to exercise its outstanding stock options, which represent 2,009,075 shares of common stock at an exercise price of $14.74 per share, on a "net exercise" basis. This method permits ZelnickMedia to satisfy the aggregate exercise price by having the company withhold shares equivalent to that value, rather than paying cash. A key benefit for Take-Two shareholders is that this net exercise approach is expected to result in less dilution to the market value of the company's outstanding shares.
Key Highlights
- 1Take-Two Interactive Software, Inc. amended a stock option agreement with ZelnickMedia Corporation.
- 2The amendment was approved by the Company's Board of Directors.
- 3The original stock option agreement was dated August 27, 2007, and covered 2,009,075 shares at an exercise price of $14.74.
- 4The amendment allows for 'net exercise' of the stock options.
- 5Net exercise means ZelnickMedia can use withheld shares to cover the exercise price, reducing immediate cash outlay.
- 6This 'net exercise' provision is designed to minimize dilution to the company's common stock in the market.
- 7The options are currently outstanding and vest over 36 months, expiring 10 years from grant.