UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No.  )

Filed by the Registrant

Filed by a Party other than the Registrant

Check the appropriate box:
	Preliminary Proxy Statement
	Confidential, for use of the Commission only (as permitted by Rule 14a-6(e)(2))
	Definitive Proxy Statement
	Definitive Additional Materials
	Soliciting Material Pursuant to §240.14a-12

Take-Two Interactive Software, Inc.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check all boxes that apply):
	No fee required.
	Fee paid previously with preliminary materials.
	Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

TAKE-TWO INTERACTIVE

SOFTWARE, INC.

110 West 44^th Street

New York, NY 10036, USA

Tel 646.536.2842

Fax 646.536.2926

www.take2games.com

LETTER TO
OUR SHAREHOLDERS

Strauss Zelnick I July 27, 2023

Dear Shareholders:

This fiscal year was a milestone year for Take-Two. We delivered Net Bookings of $5.28 billion, which reflects both the transformative evolution of our Company through our combination with Zynga, and our ability to create, market, and distribute the highest quality entertainment experiences. Our achievements symbolize our colleagues’ professionalism, passion, and relentless commitment to quality.

We are excited about our growth prospects and believe that we are approaching a significant inflection point in our business as we deliver on our pipeline and continue to unlock value from our combination with Zynga. We are confident about our strategy and are well-positioned to continue to release outstanding products, gain market share, enhance our profitability, and deliver long-term value for our shareholders.

We invite you to attend the Annual Meeting of Shareholders of Take-Two Interactive Software, Inc., that will be held on September 21, 2023, at 9:00 a.m. local time as a virtual, audio-only meeting hosted online at www.virtualshareholdermeeting.com/TTWO2023.

Details of the business to be conducted at the Annual Meeting are provided in the attached Notice of Annual Meeting of Shareholders and Proxy Statement, which you are urged to read carefully. We are pleased to use Securities and Exchange Commission rules that allow issuers to furnish proxy materials to their shareholders on the Internet. We believe these rules allow us to provide our shareholders with the information they need, while lowering the costs of delivery and reducing the environmental impact of our Annual Meeting. On or about August 1, 2023, we expect to begin mailing to most of our shareholders a Notice of Internet Availability of Proxy Materials containing instructions on how to access our Proxy Statement and Annual Report and vote online; however, shareholders of record will receive a copy of the Proxy Statement and Annual Report by mail instead of receiving the Notice of Internet Availability of Proxy Materials. The Proxy Statement and Notice of Internet Availability of Proxy Materials contain instructions on how you can receive a paper copy of the Proxy Statement and Annual Report if you only received a Notice of Internet Availability of Proxy Materials by mail.

Whether you plan to attend the meeting or not, it is important that your shares be represented and voted. After you read the Notice of Annual Meeting of Shareholders and Proxy Statement, we urge you to cast your vote via the Internet or, if you received a proxy card, either complete, sign, date and return the proxy card in the envelope provided or follow the instructions for voting by telephone included therein. If the address on the Notice of Internet Availability of Proxy Materials or the accompanying materials is incorrect, please advise our Transfer Agent, Equiniti Trust Company LLC, in writing at 6201 15^th Avenue, Brooklyn, New York 11219.

We hope that you will attend the meeting and appreciate your continued support.

Sincerely,

Strauss Zelnick

Executive Chairman and Chief
Executive Officer

 

NOTICE OF ANNUAL
MEETING OF SHAREHOLDERS

 

SEPTEMBER 21, 2023

9:00 a.m. local time

 

 

REVIEW YOUR PROXY STATEMENT AND VOTE IN ONE OF FOUR WAYS:
	INTERNET Visit the website on your proxy card
	BY TELEPHONE Call the telephone number on your proxy card
	BY MAIL Sign, date and return your proxy card in the enclosed envelope

 

Your vote is very important, regardless of the number of shares you own.

 

Please read the attached Proxy Statement carefully and complete and submit your proxy card via the Internet or telephone (as instructed on your proxy card) or sign and date your paper proxy card as promptly as possible and return it in the enclosed envelope.

VIRTUAL, AUDIO-ONLY MEETING HOSTED ONLINE AT

www.virtualshareholdermeeting.com/TTWO2023

 

ITEMS OF BUSINESS

 

1.	Election of 10 directors;
2.	Approval, on a non-binding advisory basis, of the compensation of the Company’s “named executive officers” as disclosed in the attached Proxy Statement;
3.	Approval, on a non-binding advisory basis, of the frequency of the advisory vote on the compensation of the Company’s “named executive officers”;
4.	Approval of an amendment and restatement of the Amended and Restated Take-Two Interactive Software, Inc. 2017 Stock Incentive Plan to reduce the number of shares reserved thereunder that were assumed by the Company in connection with its acquisition of Zynga Inc., to increase the available shares reserved thereunder issuable to all of the Company’s eligible employees, and to modify the share recycling mechanics applicable to outstanding awards that were assumed in connection with the Zynga acquisition;
5.	Ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending March 31, 2024; and
6.	Other business that may properly come before the Annual Meeting or any adjournment thereof.

 

RECORD DATE

 

Only shareholders of record at the close of business on July 25, 2023 are entitled to notice of and to vote at the Annual Meeting or any adjournment thereof.

 

The Board of Directors believes that the election of the nominated directors, the approval on an advisory basis of the compensation of the named executive officers, the approval of an annual advisory vote on the compensation of the named executive officers, the approval of an amendment and restatement of the Amended and Restated Take-Two Interactive Software, Inc. 2017 Stock Incentive Plan, and the ratification of the appointment of Ernst & Young LLP are in the best interests of the Company and its shareholders and, accordingly, recommends a vote “FOR” for each of these proposals.

 

To attend and ask questions at our Annual Meeting via the Internet, you must log in to www.virtualshareholdermeeting.com/TTWO2023 and enter the 16-digit control number on the notice of internet availability of proxy materials or proxy card that accompanied the proxy materials.

 

By Order of the Board of Directors,

 

 

Matthew K. Breitman

 

General Counsel Americas and Corporate Secretary

July 27, 2023

PROXY STATEMENT

Annual Meeting of Shareholders to be held on September 21, 2023

This Proxy Statement is furnished in connection with the solicitation of proxies by the Board of Directors of Take-Two Interactive Software, Inc. (the “Company” or “Take-Two”) for use at the Annual Meeting of Shareholders (the “Annual Meeting”) to be held on September 21, 2023, at 9:00 a.m. local time, including any adjournment or adjournments thereof, for the purposes set forth in the accompanying Notice of Annual Meeting of Shareholders.

The Company expects to either mail or provide notice and electronic delivery of this Proxy Statement and the enclosed form of proxy to shareholders on or about August 1, 2023.

Proxies in the accompanying form, duly executed and returned to the management of the Company and not revoked, will be voted at the Annual Meeting. A proxy may be revoked by the shareholder of record at any time prior to the voting of the proxy by a subsequently dated proxy, by written notification to the Secretary of the Company, or by personally withdrawing the proxy at the Annual Meeting and voting at the Annual Meeting.

The address of the principal executive offices of the Company is 110 West 44^th Street, New York, New York 10036, and our telephone number is (646) 536-2842.

The rules of the Securities and Exchange Commission (“SEC”) require us to notify all shareholders, including those shareholders to whom we have mailed proxy materials, of the availability of our proxy materials through the Internet.

TABLE OF
CONTENTS

PROXY SUMMARY

This summary highlights information contained elsewhere in this Proxy Statement and does not include all of the information that you should consider. You should read the entire Proxy Statement carefully before voting.

2023 Annual Meeting of Shareholders

Voting Matters and Board Recommendations

Company Performance Highlights

The Company delivered strong financial results in our fiscal year ended March 31, 2023 (“fiscal 2023”) and continued to execute successfully on our strategy to capitalize on the popularity of video games by developing and publishing high-quality interactive entertainment experiences across a range of genres.

Board of Directors Highlights

Our 10 nominees include eight independent, outside directors who as a group have extensive and diverse management experience, subject matter expertise, and knowledge that is critical to the Company.

Active and empowered lead independent director role   Deliberate approach to Board refreshment, including the addition of four new independent directors in the past six years   Annual election of all directors   Annual self-evaluations by the Board of Directors and its committees, as well as biennial individual interviews of each director by an outside third party

Majority vote standard for uncontested director elections   8 out of 10 current director nominees are independent   Board membership marked by diversity, leadership and a variety of perspectives   Annual performance review of the Chairman and CEO and other members of the executive management team by independent directors

Other

Committee Memberships

Director

Principal

Public

Corporate

Name

Age

Since

Occupation

Independent

Boards

Audit

Compensation

Governance

Executive

Michael Dornemann Lead Independent Director

77

March 2007

Retired Chairman and CEO, Bertelsmann Entertainment

—

William “Bing” Gordon

73

May 2022

Partner, Kleiner Perkins Caufield & Byers

2

Roland Hernandez

65

September 2019

Founding Principal and Chief Executive Officer of Hernandez Media Ventures

2

J Moses

64

March 2007

Principal, J Moses Projects

—

Michael Sheresky

55

March 2007

Partner, United Talent Agency

—

Ellen Siminoff

55

May 2022

Seasoned media and technology executive and board member

1

LaVerne Srinivasan

61

March 2017

Vice President, Carnegie Corporation of New York

—

Susan Tolson

61

March 2014

Retired Portfolio Manager, Capital Research and Management Company

2

Paul Viera

64

May 2018

Chief Executive Officer, Earnest Partners LLC

—

Strauss Zelnick

66

March 2007

Chairman and CEO, Take-Two Interactive Software, Inc.

1

Member

Chair

Board Leadership Update

As part of its commitment to refreshment and succession planning, the Board of Directors has decided, effective after the Annual Meeting and assuming the re-election of the applicable director nominees, to appoint Ms. Srinivasan to succeed Mr. Dornemann as our Lead Independent Director, serve as the Chair of the Executive Committee and rotate off the Corporate Governance Committee. In addition, Ms. Siminoff, who joined the Board of Directors in fiscal 2023 in connection with the Zynga transaction, and is a member of the Audit Committee, will join the Corporate Governance Committee effective after the Annual Meeting. Mr. Dornemann will step down as Lead Independent Director and remain on the committees of the Board of Directors on which he currently serves. The Board of Directors thanks Mr. Dornemann for his distinguished service as our Lead Independent Director.

Board Diversity Matrix

The following presents our Board of Directors diversity statistics in accordance with Nasdaq Rule 5606, as self-disclosed by our directors.

Shareholder Engagement

We maintain a robust year-round shareholder outreach program to facilitate ongoing, two-way dialogue on topics our shareholders find most important. Our Board members are regular participants in these critically important conversations, and we discuss a diverse range of topics, including board, governance, ESG and executive compensation practices.

Since the 2022 Annual Meeting, we sought discussions with holders of approximately 66% of our outstanding shares and held discussions with all investors who expressed an interest in engaging with us, representing approximately 40% of our outstanding shares. Members of our Compensation Committee participated in discussions with shareholders holding approximately 35% of our outstanding shares.

The key topics of discussion during shareholder engagements since the 2022 Annual Meeting included:

We have included a detailed review of our shareholder engagement cycle and feedback gathered from shareholders on executive compensation topics and the 2022 Say-on-Pay vote, and the actions taken by the Board and Compensation Committee to address them, commencing on page 34 of this Proxy Statement.

Environmental, Social and Governance (“ESG”) Matters

The Company continued to increase its focus on ESG activities this year. We published our inaugural Impact report in May 2022 and our second Impact report in July 2023, aligned with both Sustainable Accounting Standards Board, and the Task Force on Climate-Related Financial Disclosures reporting frameworks. Our Board of Directors continues to get more diverse as four of the five most recent additions to the Board are female and/or members of an underrepresented group. We are continuing to develop our sustainability strategy and commitments to help drive positive change across our industry and society. See “Proposal 1: Election of Directors —Corporate Governance and Board Practices—Environmental, Social and Governance Matters” for additional details.

Corporate Governance Highlights

The Company’s sound governance practices and policies demonstrate the Board’s commitment to strong corporate governance, effective risk management and robust independent oversight of management by the Board. The Company’s governance highlights include:

	Extensive, year-round shareholder engagement
	Annual evaluation of the Board and its Committees
	Annual review of Board leadership structure
	Ongoing review and refreshment of Board composition
	Lead Independent Director with clearly defined role and responsibilities
	Board oversight of risk management and ESG matters

	Shareholder right to call special meetings
	Shareholder right to act by written consent
	No supermajority voting requirements
	Strong anti-hedging, anti-pledging and insider trading policies
	Independent Audit Committee, Compensation Committee and Corporate Governance Committee

 

Executive Compensation Program Highlights

The Company maintains strong compensation governance practices that support our pay-for-performance principles and align management incentives with the interests of our shareholders. A substantial portion of our Company’s executive compensation opportunity in fiscal 2023 was performance-based.

We have also adopted a number of “best practices” with respect to executive compensation, including:

	Clawback policy with respect to incentive compensation
	Caps on annual bonuses to NEOs
	Double-trigger vesting on a change in control
	Meaningful stock ownership requirements (6x per annum management fee for each of the CEO/Chairman and President; 3x annual base salary for other NEOs; and 5x annual cash retainer for directors)
	No repricing of stock options without shareholder approval

	Limited perquisites
	No tax gross ups for excise taxes on parachute payments
	Annual compensation risk assessment
	Retention of independent compensation consultants
	Balanced compensation approach between short-and long-term incentive opportunities

 

Amendment and Restatement of the Amended and Restated Take-Two Interactive Software, Inc. 2017 Stock Incentive Plan

In Proposal 4 (page 83) we are asking our shareholders to approve an amendment and restatement of the Amended and Restated 2017 Stock Incentive Plan (the “2017 Plan”) to (i) reduce the number of shares reserved under the 2017 Plan that were assumed by the Company in connection with its acquisition of Zynga, which may currently only be issued to a limited group of employees of the Company as contemplated by Nasdaq Listing Rule 5635(c), from 9,123,694 shares as of June 30, 2023 to 0 shares, and (ii) increase the number of shares available for issuance under the 2017 Plan by 5,500,000 shares, which would be issuable to all of the Company’s eligible employees. If Proposal 4 is approved by our shareholders, we will have a net decrease of 3,623,694 shares reserved for issuance under the 2017 Plan.

As part of Proposal 4, we are also asking for approval to modify the share recycling provisions applicable to outstanding awards that were assumed in connection with the Zynga acquisition, which may currently only be forfeited and recycled for issuances to a limited group of employees of the Company as contemplated by Nasdaq Listing Rule 5635(c). If Proposal 4 is adopted, these recycled shares would be available for issuance to the Company’s entire employee base. As of June 30, 2023, 4,034,866 shares were subject to such assumed awards. While the precise impact of this modification on the number of shares available under the 2017 Plan will depend on the rate at which shares are returned to the 2017 Plan’s reserve upon the awards’ expiration, forfeiture or cash settlement, based on historical trends, the Company estimates this modification will result in approximately an additional approximately 978,666 shares becoming available for future issuances to the Company’s entire employee base, which would otherwise have only been available for issuance to a limited group of employees of the Company as contemplated by Nasdaq Rule 5635(c).

The Board of Directors believes that the reduction in the Zynga share reserve, the increase in shares under the 2017 Plan, and the modification to the share recycling provisions in respect of Zynga awards, will enable the Company to more effectively attract and retain the creative talent across all of our labels that drive company performance and will allow the Company to more effectively manage its annual burn rate and reduce its total fully diluted share overhang.

If our shareholders approve Proposal 4, there will be both (i) a net decrease in the total number of shares reserved for issuance under the 2017 Plan, and (ii) an increase in shares that will be issuable to all of the Company’s eligible employees, as illustrated by the below chart.

Equity is used to attract, retain, and motivate the Company’s creative talent, which is critical to executing Take-Two’s long-term strategy, and to align the interests of creative employees with the interests of the Company’s shareholders.

Plan highlights include:

	Annual limits on awards to individual participants
	Non-liberal recycling of shares used to satisfy tax withholding obligations or as payment for the exercise price or base price for stock options and SARs
	No evergreen provision for share reserve
	No payment of dividends or dividend equivalents on unvested awards
	Annual compensation limits for non-employee directors

	Minimum vesting periods for certain awards
	No repricing of underwater stock options or SARs without shareholder approval
	No discounted stock options or SARs
	Clawback provisions
	Non-liberal definition of change in control
	No automatic grants
	Double-trigger acceleration of equity vesting in a change of control

 

PROPOSAL 1: ELECTION OF DIRECTORS

All members of the Board of Directors stand for election on an annual basis, and at the Annual Meeting 10 director nominees will stand for election to hold office for a term expiring at the 2024 Annual Meeting of Shareholders. The Board of Directors, upon the recommendation of the Corporate Governance Committee, has nominated the individuals named below. Each director who is elected will serve until a successor is elected and qualified or until the director’s earlier resignation or removal.

The Corporate Governance Committee is responsible for evaluating the size and composition of the Board of Directors relative to the evolving needs of the Company at any given time, and actively identifying qualified individuals to become new director nominees as needed. The Corporate Governance Committee has developed criteria, including certain personal and professional qualities, to evaluate whether the potential nominee would be a qualified director candidate for service on Take-Two’s Board of Directors.

Our 10 nominees include eight independent, outside directors who as a group have extensive and diverse management experience, subject matter expertise, and knowledge that is critical to the Company. The average director tenure is approximately nine years. The average age of the Board members is 64. Half of the Board members are women and/or minorities.

At the Annual Meeting, the proxies given by shareholders will be voted individually for the election of the persons named herein as director nominees, unless a proxy card specifies that a shareholder is voting against any such nominee. If any of the nominees listed below shall be unable to serve, it is intended that the proxy will be voted for such other nominees as may be designated by the Board of Directors. Each of the persons named herein has indicated to the Board of Directors that he or she will be available to serve as a director of the Company.

In an uncontested election, a director will be elected if the number of votes that are cast “FOR” his or her election by holders of the stock present in person or represented by proxy entitled to vote on the election of directors exceeds the number of votes cast “AGAINST” his or her election by such holders. The Company’s bylaws provide that any nominee for director who fails to meet this standard shall promptly tender such individual’s resignation to the Corporate Governance Committee following certification of the shareholder vote. For more information regarding this policy, see “Policy on Majority Voting for Directors.”

As part of its commitment to refreshment and succession planning, the Board of Directors has decided, effective after the Annual Meeting, to appoint Ms. Srinivasan to succeed Mr. Dornemann as our Lead Independent Director, serve as the Chair of the Executive Committee and rotate off of the Corporate Governance Committee. In addition, Ms. Siminoff, who joined the Board of Directors in fiscal 2023 in connection with the Zynga transaction and is a member of the Audit Committee, will join the Corporate Governance Committee after the Annual Meeting. Mr. Dornemann will step down as Lead Independent Director and remain as a member of the committees of the Board of Directors on which he currently serves.

THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE ELECTION OF THE NOMINEES NAMED BELOW:

Each director nominee for our Board of Directors is highly qualified and brings a diversity of skills and experiences to our boardroom. These skills are relevant to our business and enable the Board of Directors to provide strong oversight and effectively oversee management’s execution of strategy.

CORPORATE GOVERNANCE AND BOARD PRACTICES

Shareholder Engagement

The Board of Directors places a premium on, oversees and, together with management, regularly participates in an extensive, year-round shareholder engagement practice. For more information regarding the Company’s shareholder engagement for the past fiscal year, see “Compensation Discussion and Analysis-Shareholder Engagement.”

Independent Directors

The Board of Directors has determined that Messrs. Dornemann, Hernandez, Moses, Sheresky and Viera and Mses. Siminoff, Srinivasan and Tolson are “independent” directors as defined under the rules of The Nasdaq Stock Market. During fiscal 2023, the independent directors met in executive session (outside the presence of management) on nine (9) occasions.

Board Leadership Structure

The Board of Directors is led by Mr. Zelnick in his role as Executive Chairman. Mr. Zelnick is also the Chief Executive Officer. The Board of Directors also has designated a Lead Independent Director (as described below), currently Mr. Dornemann, a position that complements the Executive Chairman’s role, and serves as the principal liaison between the independent directors and the Executive Chairman and Company management.

The Board of Directors reviews its leadership structure annually. The Board of Directors has determined that in light of the Company’s clear strategy and the strength of its overall governance practices, at this time a combined Chairman/CEO role more effectively unifies the Board of Directors and management around the specific initiatives necessary to support the Company’s strategy. The Board of Directors continues to evaluate Mr. Zelnick annually in each of his roles and has retained the discretion to separate the Chairman/CEO roles at any time if the Board of Directors believes it would better serve the interests of the Company and its shareholders. The Board of Directors has also concluded that its Lead Independent Director position effectively balances any potential risk of concentration of authority that may exist with a combined Chairman/CEO position.

In July 2023, the Board of Directors, based on the recommendation of the Corporate Governance Committee, as part of its regular succession planning and board refreshment review, determined that, effective after the Annual Meeting, Ms. Srinivasan will succeed Mr. Dornemann as Lead Independent Director and chair of the Executive Committee of the Board. Mr. Dornemann will remain on the Board of Directors and as a member of the Committees on which he currently serves.

Lead Independent Director

The Lead Independent Director serves as the principal liaison between the independent directors and the Executive Chairman.

The Lead Independent Director is responsible for:

presiding at all Board of Directors meetings at which the Chairman of the Board is not present;   convening regular and special meetings of the independent directors;   developing the agenda for executive sessions of the independent directors and working with the Chairman to develop and approve the agenda for meetings of the full Board of Directors, including scheduling to ensure there is sufficient time for discussion;   coordinating feedback to the Chairman on behalf of the independent directors;

coordinating with the Company’s Chief Legal Officer to respond to shareholders who have addressed a communication to the independent directors;   making himself available for shareholder communication, as appropriate (other independent directors may also participate in such communication at times); and   handling any matters concerning an actual or potential conflict of interest involving any other director.

The Lead Independent Director regularly engages separately with one or more of the Chief Executive Officer, the President, the Chief Financial Officer and the Chief Legal Officer to discuss the business strategy of the Company in greater detail and provide additional guidance to such members of management. These meetings enable the Lead Independent Director to gain a deeper understanding of any matters being handled by management which should be brought to the attention of the entire Board of Directors or a committee thereof, as well as an opportunity to obtain additional information on any matters which the Lead Independent Director believes may otherwise be of interest to the other directors and to provide advice to the other directors regarding such matters.

Annual Evaluations

The Board of Directors and its committees conduct annual self-evaluations that include both the completion of a questionnaire as well as biennial individual interviews of each director by an outside third party. These evaluations are utilized by the Board and each committee to improve communication, strategy and effectiveness, and to identify possible improvements that can be made to the performance and composition of the Board and each of its committees. The Corporate Governance Committee assists the Board of Directors in its review and reports to the full Board regarding its findings and recommendations, which are considered and implemented as appropriate. Furthermore, the Compensation Committee performs an annual performance review of the Chairman, CEO and other named executive officers and reports its findings to the full Board of Directors.

Risk Oversight

The Board of Directors exercises direct oversight of strategic risks to the Company. The Audit Committee reviews the Company’s policies for risk assessment and risk management relating to financial reporting and internal controls, as well as operational risk relating to business continuity planning, cyber, digital and physical security, including security controls over customer data, and assesses steps management has taken to control such risks and exposures. The Compensation Committee oversees risks relating to compensation programs and policies. See “Risk Assessment of Overall Compensation Program.” The Corporate Governance Committee oversees environmental, social and governance matters and operational risk relating to insurance. In each case, management periodically reports to our Board of Directors or to the relevant committee, which provides guidance on risk appetite, assessment, and mitigation. Each committee charged with risk oversight reports to our Board of Directors on those matters. In addition, the Board of Directors has regularly reviewed, overseen and continues to monitor the identification of COVID-19 risks and mitigation strategies related to the Company’s return-to-work procedures, business strategy, business continuity, and the impact on the Company’s financial planning.

Meetings of Directors

The Board of Directors held 10 meetings during fiscal 2023. Each of the incumbent directors attended at least 75% in the aggregate of all meetings of the Board of Directors and committees on which the individual served for the period of his or her service in the fiscal year.

Board Strategic Off-site

Periodically, the Board of Directors convenes at an off-site strategic planning session, which includes presentations and discussions with senior management, to review the Company’s strategic, competitive and financial performance goals as well as to discuss the Company’s long-term strategic plan. The most recent off-site strategic planning session took place in October 2021, and one is planned for the Fall of 2023.

Attendance at Shareholder Meetings

The Board of Directors has adopted a policy whereby director nominees are encouraged to attend the Company’s annual meeting of shareholders. All of our then incumbent director nominees attended the last annual meeting of the Company’s shareholders in September 2022.

Policy on Majority Voting for Directors

In response to feedback from our shareholders, on June 20, 2019, based on the Corporate Governance Committee’s recommendation, the Board of Directors approved an amendment to the Company’s bylaws to change the standard for uncontested director elections from a plurality voting standard to a majority vote standard. In an uncontested election, a director shall be elected if the number of votes that are cast “for” his or her election by holders of the stock present in person or represented by proxy entitled to vote on the election of directors exceeds the number of votes cast “against” his or her election by such holders. If a nominee who currently serves as a director is not re-elected, Delaware law provides that the director will continue to serve on our Board as a “holdover director” (i.e., until his or her successor has been duly elected and qualified, or until the earliest of his or her death, resignation or removal). In an uncontested election, any nominee for director who fails to receive a greater number of votes cast “for” such individual’s election than votes cast “against” such election promptly shall tender the individual’s resignation to the Corporate Governance Committee following certification of the shareholder vote. The Corporate Governance Committee promptly will consider the resignation offer and recommend to the Board of Directors the action to be taken with respect to such offered resignation. The Board of Directors will act on the Corporate Governance Committee’s recommendation within 90 days following the date of the Annual Meeting. Thereafter, the Board of Directors will disclose promptly its decision whether to accept the director’s resignation offer (and the reasons for rejecting the resignation offer, if applicable) in a Current Report on Form 8-K filed with the SEC. Any director tendering a resignation pursuant to this provision shall not participate in the Corporate Governance Committee recommendation or action of the Board of Directors regarding whether to accept the resignation offer.

Code of Business Conduct and Ethics

The Company has adopted a written Code of Business Conduct and Ethics that applies to directors, officers and employees of the Company, including the Company’s principal executive officer, principal financial officer, principal accounting officer and controller and any person performing similar functions. A copy of the Code of Business Conduct and Ethics is posted on the Company’s website at “www.take2games.com” and can be accessed by clicking on “Policies & Conduct,” “Conduct and Social Responsibility”, then “Global Code of Business Conduct and Ethics.” The information on our website referenced herein is not incorporated by reference in this Proxy Statement.

Supplier Code of Conduct

The Company has also adopted a Supplier Code of Conduct that applies to vendors, suppliers, consultants and other third parties we engage, which makes clear that we expect all of our business partners to operate fairly and ethically, comply with domestic and international laws, and promote a work environment that values honesty, openness, integrity, and respect for fundamental human rights, wherever in the world we do business. A copy of the Supplier Code of Conduct is posted on the Company’s website at “www.take2games.com” and can be accessed by clicking on “Polices & Conduct,” then “Supplier Code of Conduct.”

Conflict of Interest Guidelines for Directors/Directors’ Code of Conduct

The Company has adopted a written Conflict of Interest Guidelines for Directors/Directors’ Code of Conduct that applies to directors of the Company. A copy of the Conflict of Interest Guidelines for Directors/Directors’ Code of Conduct is posted on the Company’s website at “www.take2games.com” and can be accessed by clicking on “Policies & Conduct,” then “Conflict of Interest Guidelines for Directors” or “Guidelines for Directors and Board Governance,” as applicable.

ESG Matters

The Company believes that focusing on corporate governance and corporate responsibility creates value for the Company, our employees, our shareholders, our consumers and other stakeholders while also helping mitigate risks, reduce costs, protect brand value, and identify market opportunities. The Company oversees ESG matters using the following structure:

	CORPORATE GOVERNANCE COMMITTEE
	MANAGEMENT COMMITTEE
	•  Global Human Resources	•  Investor Relations	•  Financial
	•  Legal	•  Workplace	•  Creative
	•  Cybersecurity

The Company seeks to ensure that corporate responsibility and sustainability considerations are incorporated into our corporate strategy, disclosure, and long-term goals to maintain and advance sustainable shareholder value. We will publish our second Impact Report incorporating the Sustainability Accounting Standards Board standards and the Task Force on Climate-Related Financial Disclosures recommendations in August 2023. The report will highlight the Company’s efforts across key environmental, social, and governance topics and will be available on our Investor Relations webpage. The reports and website are not incorporated herein by reference. Areas on which this committee continues to focus include board diversity and refreshment, human capital management, cybersecurity, sustainability and community.

Board Diversity and Refreshment

The Board of Directors routinely reviews the composition of the Board and believes that it benefits from having a diverse group of directors, including based on experience, gender, ethnicity and other factors. The Board has taken a deliberate approach to refreshment, with a new director joining in four of the prior six years and five of our 10 director nominees having served for seven years or less. Four of the five most recent additions to the Board are female and/or members of an underrepresented group.

As part of its regular succession planning and refreshment reviews, the Board of Directors has determined that Ms. Srinivasan will succeed Mr. Dornemann as our Lead Independent Director after the Annual Meeting, serve as the Chair of the Executive Committee, and rotate off the Corporate Governance Committee. In addition, Ms. Siminoff, who joined the Board of Directors in fiscal 2023 in connection with the Zynga acquisition and is a member of the Audit Committee, will join the Corporate Governance Committee after the Annual Meeting. Mr. Dornemann will step down as Lead Independent Director and remain as a member of the committees of the Board of Directors on which he currently serves.

Human Capital Management

One of Take-Two’s most important assets is our people. We are constantly focused on our teams – their success, their structure and how best to support them given their particular needs and projects.

Employee Statistics*

While the repercussions of COVID-19 continue to be felt across the industry, over the past year, more of our employees have returned to office, and we are supporting a hybrid work environment within many teams. This evolving approach to the workplace presents new challenges for managing teams and supporting employees. In that vein, we are continuing existing programs and identifying others to ensure our people feel supported in their roles, including enhanced manager training to help strengthen teams despite the varied approaches to working, broadening our wellness and mental health offerings, encouraging people to step away from their screens when they can and spending a lot of time listening to employee feedback and encouraging employees to collaborate in person where appropriate and effective.

Our hybrid approach to the workplace, where appropriate, enables our continued focus on creativity and innovation as two of the core tenets of our organization and the lifeblood of our ongoing success. The creative teams at our labels are renowned for their consistent ability to deliver games that set new benchmarks for excellence. We support our creative and corporate teams by focusing on talent acquisition and retention, including through offering job development and skills training initiatives, extensive employee benefits and numerous well-being programs, and partnering with the leadership at our labels to foster the types of cultures our leaders believe best support and grow the creative processes for their particular teams.

Diversity, Equity, and Inclusion

We firmly believe that diverse teams are more valuable and effective, and that diversity is key to our success. We are committed to enhancing workforce diversity at Take-Two, and we strive to provide an inclusive workplace in which everyone feels respected, heard, and safe. We believe our culture of compassion and respect fosters a warm, welcoming environment for all qualified candidates and colleagues. Specific efforts we take include company-sponsored service projects in the communities in which we operate; providing financial and other support to organizations working to eradicate social injustice as well as providing educational, athletic, and other opportunities to underserved communities; working with organizations to support the rights of the LGBTQIA+ community; endeavoring to expand the diversity of our industry’s candidate pool through scholarships to minority game design students and contributions to organizations providing STEM opportunities to children in underserved communities; delivering interview training and career counseling to young adults in those same communities; and celebrating cultural differences through various employee affinity groups and company events and offerings.

Talent Assessment & Development and Employee Experience

We strongly believe in internal growth opportunities and career development tracks. We also recognize the importance of our employees staying current in an ever-changing industry. To that end, our global Learning & Development team curates a wide variety of training materials and programs targeting both hard skills development and career progression as well as programs in leadership development and employee round tables. Further, our compliance training program seeks to ensure that our employees recognize and report any signs of harassment, discrimination, retaliation, or other inappropriate behaviors in the workplace and that they understand and abide by our Code of Business Conduct and other internal policies. Our learning and development programs are designed to be closely aligned with our performance management process and succession planning. Our formalized performance management process provides the platform for evaluating each individual employee’s contributions to the team and our success, with a focus on regular communication and transparency. We work hard to ensure that development opportunities are individually tailored and that all decisions regarding hiring, career progression, and compensation are based on qualifications, work ethic, and job performance. Beyond formal performance management, we stay connected with our teams throughout the year with global town hall meetings, engagement and “pulse” surveys, culture assessments and employee round tables.

Compensation and Benefits

The main objectives of our compensation and benefit programs are to attract, retain, motivate, and reward our employees, who operate in a highly competitive and technologically challenging environment. We offer competitive compensation packages designed to incentivize high individual and Company performance. We regularly review our compensation and benefits packages from both an internal and external standpoint to ensure competitiveness, including through industry benchmarking analysis. We seek to link compensation (including annual changes in compensation) to our overall and business unit performance, as well as each individual’s contribution to the results achieved. The emphasis on our overall performance is intended to align our employees’ financial interests with the interests of our shareholders. In addition to awarding restricted stock units to employees at certain levels, we offer an Employee Stock Purchase Plan to further align the interests of our employees with our shareholders. We also provide a comprehensive benefits package that includes traditional offerings, such as medical, dental, vision, retirement, disability, accident and life insurance, prescription drugs, and leaves, and also includes programs such as well-being, fitness reimbursement, mental health benefits, mental health awareness training for Human Resources personnel and managers throughout the Company, and charitable giving with a Company match.

Cybersecurity

We continue to invest financial and operational resources to implement certain systems, processes and technologies to guard against cyber risks and to help protect our data and systems. Our Audit Committee receives regular reports regarding key cybersecurity, risks and related matters, including secure processing, storage, and transmission of personal and confidential information, such as the personally identifiable information of our users.

Sustainability

We aim to integrate environmental responsibility into our operational and product strategies. We will seek to reduce our carbon footprint by seeking to make environmentally conscious choices in our offices worldwide. We will be seeking opportunities to both reduce our carbon footprint and find opportunities for cost savings.

Community

We believe it is important to be part of and to support the communities in which we operate. We have established an employee charitable giving platform, Next Level, through which we match certain employee contributions and otherwise support charitable organizations of our employees’ choosing. In addition to our other volunteerism and giving initiatives, we continue to endow numerous industry-related organizations to deliver essential STEM education and game design programs for students from underserved and underrepresented communities. We also continue to support organizations that are working to eradicate social injustice as well as provide educational, athletic, and other opportunities to underserved communities. Furthermore, we work with organizations to support the rights of the LGBTQIA+ community, and to increase that community’s representation in our industry.

Board Committees

The Board of Directors has three standing committees entirely comprised of independent directors: a Compensation Committee, a Corporate Governance Committee and an Audit Committee. The Board of Directors also has a standing Executive Committee, currently comprised of Messrs. Dornemann (Chair), Sheresky and Zelnick. These four committees are governed by written charters which are posted in the Corporate Governance tab on the Company’s website at www.take2games.com. The Company’s Code of Business Conduct and Ethics is also posted on the Company’s website at www.take2games.com under the “Policies & Conduct” tab.

Name	Compensation Committee	Corporate Governance Committee	Audit Committee	Executive Committee
Michael Dornemann
William “Bing” Gordon
Roland Hernandez
J Moses
Michael Sheresky
Ellen Siminoff
LaVerne Srinivasan
Susan Tolson
Paul Viera
Strauss Zelnick
Meetings in Fiscal 2023	10	6	5	4

Member

Chair

As part of its commitment to refreshment and succession planning, the Board of Directors has decided, effective after the Annual Meeting, to appoint Ms. Srinivasan to succeed Mr. Dornemann as our Lead Independent Director, serve as the Chair of the Executive Committee and rotate off the Corporate Governance Committee. In addition, Ms. Siminoff, who joined the Board of Directors in fiscal 2023 in connection with the Zynga transaction and is a member of the Audit Committee, will join the Corporate Governance Committee effective after the Annual Meeting. Mr. Dornemann will step down as Lead Independent Director and remain as a member of the committees of the Board of Directors on which he currently serves.

Compensation Committee members are Messrs. Sheresky (Chair), Dornemann, Hernandez and Moses, each of whom is an independent director under Nasdaq’s Rule 5605, and a “non-employee director” as defined under the SEC rules. The Compensation Committee, among other roles, reviews the compensation policies and procedures of the Company, evaluates and approves executive officer compensation, and makes recommendations to the Board of Directors regarding executive compensation.

Corporate Governance Committee members are Messrs. Moses (Chair), Dornemann and Sheresky and Ms. Srinivasan. This committee is responsible, among other things, for creating and maintaining overall corporate governance policies for the Company, identifying, screening and recruiting director candidates for the Board of Directors and overseeing our environmental, social and governance initiatives. Effective after the Annual Meeting, Ms. Srinivasan, who is succeeding Mr. Dornemann as our Lead Independent Director, will rotate off the Corporate Governance Committee and Ms. Siminoff will join the Corporate Governance Committee.

The Corporate Governance Committee will consider nominees recommended by shareholders, provided that the recommendation contains sufficient information for the committee to assess the suitability of the candidate and such nomination complies with the Company’s bylaws. Candidates recommended by shareholders that comply with these procedures will receive the same consideration that candidates recommended by the committee receive.

When selecting directors, the Board of Directors reviews and considers many factors, including experience, business understanding, achievement, available time, diversity, skills and independence. It also will consider ethical standards, integrity and any conflict of interest. It considers recommendations primarily from shareholders of the Company and from members of the Board of Directors and management. The Corporate Governance Committee conducts interviews with candidates who meet the criteria of the Board of Directors and has full discretion in considering its nominations to the Board of Directors. The Board of Directors adopted Corporate Governance Guidelines, which include criteria to assess the suitability of candidates for the Board of Directors. These Corporate Governance Guidelines are posted under the “Conduct” tab on the Company’s website at “www.take2games.com”.

Audit Committee members are Ms. Tolson (Chair), Ms. Siminoff and Messrs. Dornemann and Viera. The Audit Committee oversees the accounting and financial reporting processes of the Company and audits of the financial statements of the Company. In addition, the Audit Committee assists the Board of Directors in its review and oversight of the Company’s key investment objectives, strategies and policies, as well as the Company’s operational risk relating to business continuity planning, cyber, digital and physical security, including security controls over customer data. The Board of Directors has determined that Ms. Tolson and Mr. Viera each qualify as an “audit committee financial expert” under federal securities laws.

Other Executive Officers

Each of the following executive officers, who are not also directors, will serve in such capacity until the next Annual Meeting of Shareholders or until earlier termination or removal from office.

PROPOSAL 2: NON-BINDING ADVISORY VOTE TO APPROVE THE COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS

In accordance with the SEC’s proxy rules, we are seeking approval, on a non-binding advisory basis, of the compensation of the Company’s “named executive officers” listed in the Summary Compensation Table (the “NEOs”) for fiscal 2023, as disclosed in this Proxy Statement pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, the compensation tables, and the related narrative disclosures. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our NEOs and the philosophy, policies and practices described in this Proxy Statement. This vote is commonly known as a “say-on-pay” advisory vote. Consistent with the approval by our shareholders, on an advisory basis, of an annual advisory vote on the compensation of the named executive officers, the Board of Directors has adopted a policy providing for annual “say-on-pay” advisory votes.

The compensation of our NEOs is described in detail in the “Compensation Discussion and Analysis” section of this Proxy Statement beginning on page 30, which we encourage you to read for additional details on our executive compensation programs and compensation of our NEOs for fiscal 2023.

Our executive compensation programs are based on three core principles that are designed to motivate our NEOs to achieve annual financial and strategic objectives to enhance the profitability of the Company and create long-term shareholder value. The fiscal 2023 compensation of our NEOs reflected these core principles:

		A substantial portion of our NEOs’ compensation was based on the financial performance of the Company and therefore “at risk”;
		The majority of each NEO’s total compensation was provided in the form of long-term equity, two-thirds of which was subject to total shareholder return (“TSR”) and certain other performance metrics, to further align the interests of our NEOs and shareholders; and
		The target total direct compensation package for each NEO was consistent with market practices for executive talent and each NEO’s individual experience, responsibilities and performance.

We believe that our compensation programs and policies for fiscal 2023 were consistent with our core compensation principles, provided an effective incentive for the achievement of positive results, aligned with shareholders’ interests, are supported by strong compensation governance practices and worthy of continued shareholder support.

Also, as further discussed in the “Compensation Discussion and Analysis” section of this Proxy Statement beginning on page 30, in fiscal 2023, we engaged in extensive shareholder outreach on executive compensation practices, with the goal of strengthening our compensation programs and practices by incorporating shareholder feedback. Accordingly, we ask for our shareholders to indicate their support for the compensation paid to our NEOs by voting “FOR” the following non-binding resolution at the Annual Meeting:

“RESOLVED, that the Company’s shareholders approve the compensation of the named executive officers for the fiscal year ended March 31, 2023, including the Compensation Discussion and Analysis, the compensation tables, and the related narrative disclosures as included in this Proxy Statement.”

Because your vote is advisory, the result will not be binding upon the Company. Although not binding, the Board of Directors values the opinions of our shareholders and will carefully review and consider the outcome of the vote, along with other relevant factors, in evaluating its compensation program for our NEOs.

THE BOARD OF DIRECTORS BELIEVES THAT APPROVAL OF THE FOREGOING RESOLUTION ON THE COMPENSATION OF THE NEOS IS IN THE BEST INTERESTS OF THE COMPANY AND UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE APPROVAL OF THE COMPENSATION OF THE COMPANY’S NEOS, AS STATED IN THE ABOVE NON-BINDING RESOLUTION.

LETTER FROM THE
COMPENSATION COMMITTEE

Dear Fellow Shareholders,

Fiscal 2023 was a milestone year in Take-Two’s 30-year history. Our combination with Zynga marked a transformative evolution of our Company, as we significantly diversified our business operations and established a leadership position in mobile, the fastest growing segment of the interactive entertainment industry. The combination with Zynga has been highly accretive to our business and we see substantial runway ahead of us as we capitalize on new revenue-driven opportunities while also realizing our anticipated cost synergies. Looking ahead, we are excited about Take-Two’s strategic position within our industry and believe that we can continue to scale our business to grow margins and ultimately deliver long-term value for our shareholders.

At our 2022 Annual Meeting, we were disappointed in the support level for our advisory vote on executive compensation and the Compensation Committee led an exhaustive outreach effort to ensure we understood our shareholders’ concerns. We reached out to the holders of approximately 66% of our outstanding common stock, held discussions with all shareholders who expressed an interest in engaging with us, and the members of this Committee held conversations with holders of approximately 35% of our outstanding common stock during this period.

We heard very clearly during discussions following our 2022 Annual Meeting that our shareholders had concerns with the goal setting rigor in our annual incentive program. In response to this feedback, we have thoroughly reviewed our goal setting process and are committed to setting rigorous goals. Full details of the actions we have taken, including setting targets higher than prior year achievements in fiscal years 2023 and 2024, are described in detail on page 34. As testament to the rigor of our targets, the short-term plan had no payouts to ZMC or our other NEOs for fiscal 2023 because we did not achieve threshold adjusted EBITDA performance.

While we were acutely focused on responding to shareholders following our 2022 Annual Meeting, we have a long track record of responsiveness as evidenced by several changes incorporated into ZMC’s new 2022 Management Agreement which came into effect for fiscal 2023. Although our shareholders have been pleased with the historical structure and transparency of the management agreement, we had heard from our investors through our annual engagement program a desire for further strengthening of the performance-based nature of the agreement. The Compensation Committee incorporated this feedback into the compensation structure in the 2022 Management Agreement through several changes that meaningfully increase the performance-based nature of the program:

We also maintained all the features that shareholders appreciated, such as high-performance thresholds for relative TSR and transparent disclosure of the compensation to our CEO and President. We believe that the cumulative effect of these changes establishes even stronger alignment of interests with our shareholders as ZMC focuses on continuing to drive our market leading positioning and integration of Zynga to create, market and distribute the highest quality entertainment experiences.

Our Board is committed to maintaining an open dialogue with investors. The feedback gathered throughout these conversations informs the decisions the Compensation Committee makes when determining the design of our executive compensation program. We believe that leveraging this feedback has allowed us to implement a performance-driven incentive program whereby executive opportunities are directly in-line with long-term positive shareholder returns.

We thank you for your continued investment in Take-Two and look forward to our future discussions.

Sincerely,

The Compensation Committee

Michael Sheresky (Chair)

Michael Dornemann

Roland Hernandez

J Moses

COMPENSATION DISCUSSION AND ANALYSIS

The Compensation Discussion and Analysis section describes the material elements of our executive compensation program for fiscal 2023, including the named executive officers (“NEOs”) as identified in the Summary Compensation Table and listed below:

Strauss Zelnick Executive Chairman and Chief Executive Officer	Karl Slatoff President	Lainie Goldstein Chief Financial Officer	Daniel Emerson Executive Vice President and Chief Legal Officer

Executive Summary

Take-Two is a leading developer, publisher and marketer of interactive entertainment for consumers around the globe. We develop and publish products principally through Rockstar Games, 2K, Private Division and Zynga.

We generate financial returns for our shareholders by pursuing a strategy of capitalizing on the widespread popularity of interactive entertainment and by focusing on publishing a select number of high-quality titles for which we can create sequels and build successful franchises. We also seek to complement our core release schedule with digitally delivered offerings designed to drive recurrent consumer spending, which is generated from ongoing consumer engagement and includes revenue from virtual currency, add-on content, and in-game purchases.

Our management team and creative talent at Rockstar Games, 2K, Private Division, and Zynga are essential to building and maintaining the strongest portfolio of Intellectual Property (“IP”) in the industry. Our compensation program is designed to reflect the importance of our creative talent, including through the use of equity awards to establish strong links between our creative teams and long-term value creation for shareholders.

Select Fiscal 2023 Performance Highlights

The Company delivered strong financial results in fiscal 2023 and continued to execute successfully on our strategy to capitalize on the popularity of video games by developing and publishing high-quality interactive entertainment experiences across a range of genres.

Business Highlights

Our strong financial performance in fiscal 2023 also reflects the strategic steps management has taken in the past several years to fortify our balance sheet, grow and diversify our franchise portfolio, and reduce costs.

The following line graph compares, from March 31, 2018 through March 31, 2023, the cumulative total shareholder return (“TSR”) on our common stock with the cumulative TSR on (1) the stocks comprising the Nasdaq Composite Index, (2) the stocks comprising a performance peer group index of our two most direct competitors - Activision Blizzard, Inc. and Electronic Arts Inc., (3) the stocks comprising the S&P 500 Index, and (4) the RDG Technology Composite Index which will, in subsequent years, replace the current performance peer group index. This change to the RDG Technology Composite Index is being made to compare Take-Two to a broader group of companies in our industry using a published industry index. Both Activision Blizzard and Electronic Arts are included in the broader RDG Technology Composite Index. The comparison assumes $100 was invested on March 31, 2018 and tracks it through March 31, 2023.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*

Among Take-Two Interactive Software, Inc., the NASDAQ Composite Index, the S&P 500 Index,
the RDG Technology Composite Index, and a Peer Group

Shareholder Engagement   We maintain a robust year-round shareholder outreach program to facilitate ongoing, two-way dialogue on topics our shareholders find most important. Our Board members are regular participants in these critically important conversations, and we discuss a diverse range of topics, including board, governance, ESG and executive compensation practices.   In response to the low support for the Advisory Vote on Executive Compensation at our 2022 Annual Meeting, we pursued an exhaustive shareholder engagement effort specifically targeted to listen to our shareholders and seek feedback on our compensation programs. Since the 2022 Annual Meeting, we sought discussions with holders of approximately 66% of our outstanding shares and held discussions with all investors who expressed an interest in engaging with us, representing approximately 40% of our outstanding shares. Members of our Compensation Committee actively participated in discussions with shareholders holding approximately 35% of our outstanding shares.

Responsiveness to Shareholder Feedback

Our Board of Directors has a long history of proactive engagement with our shareholders and incorporating their feedback into our compensation programs and practices. Below is a summary of what we heard and how we responded to recent shareholder feedback immediately following our 2022 Annual Meeting, as well as past feedback and responsiveness incorporated into the new 2022 Management Agreement with ZMC, which became effective for fiscal 2023.

2022 Say-on-Pay Vote

Through extensive dialogue with our shareholders in the lead up to and following the 2022 Annual Meeting, we gathered direct feedback on the concerns that informed our vote outcome. Through this dialogue, we learned that the overriding concern that drove negative say-on-pay votes related to the goal-setting rigor in our annual cash incentive program.

2022 Management Agreement with ZMC

As part of our regular dialogue with shareholders each year, the Compensation Committee has accumulated feedback on enhancements that investors would like to see with a new ZMC Management Agreement. In May 2022, we entered into a new agreement with ZMC and the Compensation Committee was acutely focused on implementing structural changes that were directly responsive to feedback we have heard from our shareholders over the years, including increasing the performance-based nature of the compensation opportunity.

Transition Award Rationale and Structure

Shareholders asked for disclosure explaining the rationale and structure of the transition awards that were made in June 2022 under the 2022 Management Agreement. The purpose of these one-time transition awards was to fill certain short-term gaps in vesting and value created by the transition from our 2017 Management Agreement to our 2022 Management Agreement as illustrated by the following chart and described in more detail below:

Vesting gap grants. The extension of the equity vesting period from two to three years created a one-time gap in vesting opportunity for fiscal 2025 and fiscal 2026. The Compensation Committee believed it was important to establish continued vesting and earning opportunity during this gap period to align executives’ compensation opportunity with the larger and more complex nature of our business since the closing of the Zynga acquisition, and took action to meaningfully increase the performance weighting to better align incentives with shareholder value. These grants fill in those gaps, such that the vesting opportunity contemplated under the 2022 Management Agreement commences with fiscal 2025 as illustrated in the above chart. Specifically, the transition awards cliff vest in two and three years, respectively, and are otherwise entirely structured in accordance with the updated criteria in

the 2022 Management Agreement, including being comprised of 67% performance-based shares. For a full description of these grants, see “Certain Relationships and Related Transactions—Management Agreement.”

Fiscal 2023 Variable Compensation Targets and Performance Achievement

Annual and long-term incentives for ZMC and our other NEOs are based on measurable financial and share price performance metrics that reflect key measures of our success. The following table summarizes the Company-wide targets and actual results for both ZMC and NEO performance-based cash compensation for fiscal 2023 and equity compensation linked to TSR performance granted in fiscal 2023.

Incentive Component		Financial Performance Metrics		2023 Performance Threshold	2023 Performance Target	2023 Performance Maximum
Annual Incentive		Adjusted EBITDA
Performance-Based RSUs (Fiscal 2023 Grant)		Relative TSR
				*   Relative TSR is measured over the two- or three-year period ending March 31, 2024 or March 31, 2025, as applicable.

Annual Incentive Plan Target Setting

Our Compensation Committee establishes the annual cash incentive based solely on performance against a budgeted Adjusted EBITDA (a non-GAAP measure calculated by taking GAAP net income recorded for the Company, adding back or subtracting the net effect from deferral in net revenues and related costs of goods sold, impact of business reorganization, one-time gains or losses on long-term investments, acquisition related costs, stock based compensation, interest, depreciation, amortization and tax expenses) goal set at the beginning of each fiscal year. Refer to Annex A herein for a reconciliation of GAAP net income to the Adjusted EBITDA measure discussed above. There is no discretionary element to this goal, and the Compensation Committee uses the same Adjusted EBITDA goal in our internal executive pay program. We believe Adjusted EBITDA is an objective measure that focuses our executives on operating growth and profitability.

In setting an Adjusted EBITDA target, the Board of Directors works closely with management as part of an iterative process to set the budget and determine an appropriate target that aligns with the Company’s goals and objectives for the upcoming fiscal year. The Board of Directors is guided by a philosophy to set rigorous, yet achievable goals that contain appropriate stretch to motivate outperformance. The factors considered in determining the appropriate annual Adjusted EBITDA target include the Company’s projected annual release schedule, whether the releases are new IP or iterations of established IP, the Company’s expected investment in future research and development, and an analysis of the risks and opportunities for the upcoming fiscal year. Because release schedules, investment amounts, and expected risks and opportunities differ year over year, a rigorous target that provides an appropriate incentive for the Company’s executives will vary from year to year.

In setting our fiscal 2023 Adjusted EBITDA targets, the Board of Directors specifically considered, among other factors:

As a result of these considerations, the fiscal 2023 Adjusted EBITDA target was set at a level above both the actual Adjusted EBITDA achieved in fiscal 2022, and the maximum performance goal for fiscal 2022.

Annual Incentive Plan Achievement

Target Adjusted EBITDA for fiscal 2023 was $1.188 billion and the Company achieved actual Adjusted EBITDA of $940.6 million. This Adjusted EBITDA achievement level reflects a 14% increase over last year’s Adjusted EBITDA achievement and was the result of the successful integration of Zynga, strong catalogue execution throughout the

year, and targeted cost containment, but it fell short of the threshold amount of 80% of our fiscal 2023 Adjusted EBITDA target due to the following factors:

As a result, ZMC and our other NEOs did not receive any bonus payout under the fiscal 2023 annual incentive plan. For further discussion of our results for fiscal 2023, see the above section titled “Select Fiscal 2023 Performance Highlights.”

ZMC Management Agreement

Executive Chairman and CEO Strauss Zelnick and President Karl Slatoff serve as executives of the Company under a management agreement with ZMC, a partnership of private equity investors that focuses on the media and communications industry, of which they are partners.

On May 3, 2022, the Company and ZelnickMedia entered into a management agreement (the “2022 Management Agreement”) that became effective as of the close of the Zynga acquisition on May 23, 2022 (the “Effective Date”) and superseded the prior management agreement with ZelnickMedia dated as of November 17, 2017 (the “2017 Management Agreement”). On May 21, 2022, ZelnickMedia assigned substantially all of its rights and obligations and other liabilities under the 2022 Management Agreement to ZMC. References to “Management Agreement” in this Proxy Statement refer to both the 2017 Management Agreement and the 2022 Management Agreement interchangeably. Fees and incentives paid to ZMC during fiscal 2023 are detailed below under “Fiscal 2023 Fees and Incentives to ZMC.”

Under the 2022 Management Agreement, ZMC will continue to provide management, consulting and executive level services to the Company through March 31, 2029.

The 2022 Management Agreement includes the following enhancements that were implemented in response to feedback from shareholders:

The Compensation Committee believes the Company’s management structure and relationship with ZMC has been critical to building the Company’s franchises, improving profitability, strengthening the balance sheet, and providing disciplined management. Many shareholders have told us that we should make continuing the relationship with ZMC a top priority.

Since first engaging ZMC in 2007, the Company has been transformed from single franchise dependency into a diverse, financially strong, global interactive entertainment enterprise. The Company now has 13 franchises with individual titles that have sold-in to retail more than 5 million units each, and 73 individual, multi-million unit selling titles. The Company has also expanded geographically, in digital distribution and with new business models, and grown strategically, including by executing upon the transformative acquisition of Zynga during fiscal 2023.

As part of its regular governance practices, the Board of Directors continuously reviews the relationship with ZMC to ensure that it remains the right management structure for the Company and our shareholders. At least annually, the Compensation Committee conducts interviews on a confidential basis with all direct reports to Messrs. Zelnick and Slatoff, and other members of management, to seek feedback on the performance of the ZMC executives and our other NEOs and to evaluate the effectiveness of the ZMC relationship more broadly. The Compensation Committee’s feedback from these 360-degree interviews is then discussed at executive sessions of independent Board members. This feedback was taken into consideration during the most recent ZMC management agreement negotiation. The Lead Independent Director also regularly engages with members of the executive team, including non-ZMC members of management.

NEO Compensation Structure and Pay-for-Performance Principles

The Compensation Committee has developed compensation programs and arrangements designed to place a substantial portion of our executives’ compensation at risk based on Company performance. Equity awards are a key element in the compensation of our executives, as well as creative talent throughout the organization. The Compensation Committee believes equity awards create strong linkage between our executives and the long-term performance of our Company as well as the interests of our shareholders.

In fiscal 2023, the Compensation Committee increased the percentage of performance awards from 55% to 67% of the annual equity grants to ZMC, based on feedback received from shareholders, significantly increasing the portion of equity awards that are “at risk”. Also based on feedback from shareholders, the Compensation Committee increased the performance periods for the performance awards issuable to all our NEOs from two to three years to ensure alignment with long-term shareholder value.

Compensation to Executive Chairman and CEO and President

We believe the short-term and long-term incentives are balanced to help incentivize optimal performance and also note that there is no duplication in use of performance metrics between short-term and long-term programs.

The following table summarizes the compensation components of the 2022 Management Agreement for compensation in fiscal 2023 (noting that, for fiscal 2023, the RSU grant made in April 2022 was under the 2017 Management Agreement and one of the RSU grants made in June 2022 had two-year performance-based vesting terms, as discussed below under “Certain Relationships and Related Transactions—Management Agreement”):

Compensation of Other Named Executive Officers

In fiscal 2023, Ms. Goldstein and Mr. Emerson were compensated through three primary components: base salary, annual incentive and long-term incentives, the majority of such compensation was performance-based and weighted toward long-term incentives.

Structural Pay and Performance Alignment for All NEOs

Our NEOs receive a mix of compensation that is appropriately weighted towards at-risk pay in the form of annual incentives and long-term incentives. The Compensation Committee believes this creates strong alignment with the Company’s stated compensation philosophy of providing compensation commensurate with individual and corporate performance. The majority of incentive compensation is also delivered in the form of equity, which provides strong alignment between executives’ incentives and the interests of our shareholders.

The following chart illustrates the fiscal 2023 compensation mix, based on maximum compensation opportunities, for ZMC and for our other NEOs.

Highlights of Compensation Governance Practices

Take-Two maintains strong compensation governance practices that support our pay-for-performance principles and align management incentives with the interests of our shareholders. We have adopted a number of “best practices” with respect to executive compensation, including:

Detailed Discussion and Analysis

The main body of this Compensation Discussion and Analysis provides details on the principles and objectives of our executive compensation program and the Compensation Committee’s key fiscal 2023 compensation-related decisions. This section is organized into the following categories:

I. Objectives and Philosophy of Executive Compensation

Our executive compensation program is designed to drive Take-Two’s mission of producing strong, sustainable financial results for its shareholders by pursuing a strategy of being the most creative, innovative, and efficient company in the evolving interactive entertainment industry. With our diverse portfolio that spans all key platforms and numerous genres, we strive to create the highest quality, most engaging interactive entertainment franchises and captivate our global audience. To achieve this, it is critical that we have the resources available to attract and retain executives who are committed to creativity, efficiency and innovation.

Accordingly, the Compensation Committee has established a market competitive compensation plan for our NEOs that is designed to:

Our compensation program’s design, and in particular the use of equity awards as a key incentive element, establishes strong links between our creative teams and long-term value creation for shareholders. Our compensation program reflects the importance of creative talent to our business and enables us to retain and incentivize these groups. As a result of the importance we place on equity incentives, Take-Two may, in some years, have higher equity usage for share plans than some of our peers. The Board of Directors periodically authorizes share repurchases when it believes such actions are in the best interest of the shareholders; these repurchases directly reduce the number of the Company’s outstanding shares.

II. Competitive Market Positioning

The Compensation Committee determines pay levels for our NEOs based on a number of factors, including the individual’s role and responsibilities within the Company, the individual’s experience and expertise, historical compensation actually realized by the individual, pay levels in the marketplace for similar positions, and performance of the individual and the Company as a whole. In determining pay levels, the Compensation Committee considers all forms of compensation and benefits, including the mix thereof.

After consideration of data collected on external competitive levels of compensation and internal relationships within the executive group, the Compensation Committee makes decisions regarding each individual NEO’s target total compensation opportunity based on the need to attract, motivate and retain an experienced and effective management team.

Each year, the Compensation Committee reviews and approves the peer group companies that are used to evaluate competitive market compensation. In doing so, the Compensation Committee seeks to approve a peer group that is representative of the sector in which we operate and includes companies with similar revenue and market capitalization as Take-Two. As such, to support development of our incentive program for fiscal 2023, Frederic W. Cook & Co., Inc. (“FW Cook”) performed a peer group analysis in May and June 2022 and recommended certain adjustments to the peer group, which were adopted by our Compensation Committee. In adopting the updated peer group for fiscal 2023, the Compensation Committee considered that the anticipated post-Zynga combination size of the Company was at the 48^th percentile with respect to trailing four quarters revenue and the 64^th percentile with respect to market capitalization when compared with the updated fiscal 2023 peers.

Fiscal 2023 Peer Group

The peer group used to evaluate competitive market compensation of NEOs for fiscal 2023 was composed of the following 16 companies:

While the Compensation Committee believes that the peer group consists of a collection of companies for which executive compensation information is publicly available that are most comparable to the Company, the Compensation Committee understands that Take-Two has a limited number of direct competitors in the videogame industry and that many of the Company’s competitors are either privately held and/or incorporated in foreign jurisdictions which do not require public disclosure of executive compensation. This dynamic creates added challenges when constructing a statistically reliable set of peers and requires that the Company both include the few direct competitors it has in the group, even if larger, and to expand its pool of potential peer companies to those that are tangentially related to the Company (i.e., internet and technology, and entertainment and leisure companies) but with which we do compete to attract and retain talent. While imperfect, the Compensation Committee believes the peer group selected is representative of the sector in which the Company operates, and includes a balanced set of companies with similar revenue and market capitalization as Take-Two. As a result, the companies indicated in the table above were added to the fiscal 2023 peer group and the following companies were removed: AMC Networks, Inc., Autodesk Inc., Fair Isaac Corporation, IAC/InterActiveCorp, Light & Wonder, Inc. f/k/a Scientific Games Corporation, Lions Gate Entertainment Corp., Norton LifeLock Inc., and Zynga Inc. For fiscal 2024, as part of its annual review process, the Compensation Committee worked with FW Cook to review the peer group in March 2023, and determined to remove Twitter, Inc. (following its take-private acquisition), and to add Roblox Corporation.

Target Determinations

The Compensation Committee annually reviews total NEO compensation as compared to competitive market data. For purposes of calculating annual target compensation for any fiscal year, the Compensation Committee includes annual base salary, annual target cash bonus, annual target long-term incentive compensation and any special awards. Ms. Goldstein’s and Mr. Emerson’s annual pay targets in fiscal 2023 are both between the median and 75^th percentile of the peer group used by the Company in considering executive compensation.

III. Compensation to Executive Chairman and CEO and President

Take-Two has a long-standing management relationship with ZMC, under which ZMC provides executive management and other services to Take-Two. This relationship was first established in 2007 and has been maintained, with several amendments and restatements, since that time. Our Executive Chairman and CEO, Strauss Zelnick, and our President, Karl Slatoff, serve in their current roles pursuant to the 2022 Management Agreement with ZMC. Mr. Zelnick has been our Executive Chairman since 2008 and our CEO since 2011. Mr. Slatoff has been our President since May 2013 and previously served in other executive roles at the Company.

On May 3, 2022, the Company entered into the 2022 Management Agreement that became effective on May 23, 2022, which superseded the 2017 Management Agreement from and after the effective date of the 2022 Management Agreement. Fees and incentives paid to ZMC during fiscal 2023 are detailed below under “Fiscal 2023 Fees and Incentives to ZMC.” Based on shareholder feedback, the Compensation Committee implemented the following enhancements to the 2022 Management Agreement designed to significantly increase the proportion of compensation that is “at risk” based on performance and further link the compensation paid to our CEO and President with long-term shareholder value:

The target compensation opportunity for ZMC under the Management Agreement takes into consideration the Company’s need for a senior leadership team that can provide financial and technological acumen as well as management of creative talent. This is a unique combination of skills that creates a limited pool of candidates, and has resulted in the Board of Directors’ decision to provide a competitive compensation opportunity for ZMC. However, this compensation opportunity is contingent on achieving superior performance.

Services Provided by ZMC

The provisions of the Management Agreement establish the payments and benefits to which ZMC is entitled as consideration for providing certain valuable and unique services. These services include:

The Board of Directors and Compensation Committee believe that the services provided by ZMC, inclusive of the services of Mr. Zelnick and Mr. Slatoff, are a competitive advantage to Take-Two. The Board of Directors and the Compensation Committee regularly evaluate the relationship with ZMC to ensure that it is still the appropriate management structure for the Company. To facilitate this review:

Fiscal 2023 Fees and Incentives to ZMC

During fiscal 2023, in accordance with the 2017 Management Agreement and 2022 Management Agreement, ZMC received an annual management fee, had the opportunity to receive an annual performance-based incentive, the payment of which is linked solely to an objective company performance measure, and received a long-term incentive equity grant in a combination of time-based vesting RSUs and performance-based vesting RSUs.

Compensation to ZMC in fiscal 2023 under the 2017 Management Agreement and the 2022 Management Agreement is summarized below:

For a detailed description of the fees and incentives to ZMC under the Management Agreement, including the RSUs awarded in fiscal 2023 and 2024 and the awards vested in fiscal 2023, see “Certain Relationships and Related Transactions—Management Agreement”.

Compensation of Mr. Zelnick and Mr. Slatoff

Under the Management Agreement, Mr. Zelnick may not receive more than 60% of the aggregate compensation paid to ZMC and Mr. Slatoff may not receive more than 40% of the aggregate compensation paid to ZMC. These individual caps continue to provide greater transparency with respect to the maximum compensation payable to Messrs. Zelnick and Slatoff. Beyond this provision, the allocation of any revenues of ZMC among its principals is not set forth in the Management Agreement or determined by means of any process in which the Company participates. In connection with their provision of services to the Company pursuant to the Management Agreement, and subject to the limitations above, the actual amount of compensation received by Messrs. Zelnick and Slatoff is determined in the sole discretion of ZMC.

Mr. Zelnick and Mr. Slatoff each continue to receive $1 annually in compensation from the Company, to provide them the opportunity to receive certain health and other plan benefits, the value of which is described in the Summary Compensation Table below. Mr. Slatoff receives his $1 of annual compensation pursuant to an employment agreement entered into with the Company in February 2008, the terms of which are described under “Executive Compensation—Narrative Disclosure Regarding Equity Plans and Employment Agreements—Employment Agreements—Karl Slatoff” below.

For illustrative purposes only, assuming that ZMC allocated the maximum 60% of the payments under the 2022 Management Agreement to Mr. Zelnick and the maximum 40% of the payments under the 2022 Management Agreement to Mr. Slatoff, the compensation to Messrs. Zelnick and Slatoff would be as follows:

		Minimum					Target					Maximum
		•	≤80% Adjusted EBITDA Goal				•	100% Adjusted EBITDA Goal				•	≥150% Adjusted EBITDA Goal
		•	<40th Percentile Relative TSR				•	50th Percentile Relative TSR				•	≥75th Percentile Relative TSR
		•	Min Recurrent Consumer Spending Goal				•	Target Recurrent Consumer Spending Goal				•	Max Recurrent Consumer Spending Goal
Annual Management Fee			$	3,300,000				$	3,300,000				$	3,300,000
Annual Incentive Metric: Adjusted EBITDA			$	0				$	6,600,000				$	13,200,000
Time-Based RSUs(1)			$	12,409,320				$	12,409,320				$	12,409,320
Performance-Based RSUs Metrics: TSR and Recurrent Consumer Spending Performance(1)			$	0				$	25,194,680				$	50,389,360
Total Compensation Opportunity			$	15,709,320				$	47,504,000				$	79,298,680
Maximum Opportunity at Each Performance Level

Historically, the targets set by the Board of Directors in ZMC management agreements have been sufficiently challenging that payouts to ZMC have varied. For example:

Performance Equity Vesting Achievement

Annual Incentive Plan Achievement

Additionally, the compensation received by ZMC and the other NEOs is strongly aligned with the Company’s performance on TSR during the same period as evidenced by our ranking in the top quartile (above 75^th percentile) of all companies in the Nasdaq Composite Index for the two-year measurement period that ended on March 31, 2021 and the top half (above 50^th percentile) of the two-year measurement periods that ended on each of March 31, 2022 and March 31, 2023.

IV. Other NEO Compensation

Other NEOs for fiscal 2023 were Ms. Goldstein, our Chief Financial Officer and Mr. Emerson, our Executive Vice President and Chief Legal Officer. Pay opportunities for specific individuals vary based on a number of factors, such as scope of duties, tenure, institutional knowledge and/or difficulty in recruiting a new executive. Actual total compensation and the mix of such compensation in a given year will vary above or below the target compensation levels based primarily on the attainment of operational goals and the creation of shareholder value. The Compensation Committee believes that each of the compensation packages to Ms. Goldstein and Mr. Emerson are within the competitive range of practices when compared to the objective comparative data.

Compensation Overview

In May 2018 and January 2015, the Company entered into amended employment agreements with Ms. Goldstein and Mr. Emerson, respectively, which provide for an annual base salary, annual cash bonus opportunity, and long-term incentive compensation opportunities. The details of those employment agreements are discussed below under “Executive Compensation—Narrative Disclosure Regarding Equity Plans and Employment Agreements—Employment Agreements.”

Ms. Goldstein’s and Mr. Emerson’s fiscal 2023 target compensation was comprised of:

As a result of the Company’s Adjusted EBITDA performance for fiscal 2023, which was higher than the Company’s actual Adjusted EBITDA achievement in fiscal 2022, but less than the 80% threshold amount of the Company’s fiscal 2023 Adjusted EBITDA target, both Ms. Goldstein and Mr. Emerson did not receive a cash bonus for fiscal 2023. For a discussion of the Company’s Adjusted EBITDA goals and performance, see “Compensation Discussion and Analysis—Executive Summary—Fiscal 2023 Variable Compensation Targets and Performance Achievement.”

V. Principal Elements of Non-ZMC Related Executive Compensation

Pay Elements—Overview

Executive compensation for our NEOs consists of the following elements:

Base Salary

Base salary is intended to provide fixed pay that considers an NEO’s role and responsibilities, experience, expertise, marketplace comparables and individual performance, and although established by the NEOs’ employment agreements, is subject to annual review by the Compensation Committee, including for discretionary year-to-year increases. On May 17, 2018, the Company entered into a third amendment to its employment agreement with Ms. Goldstein to extend the term of the agreement through March 31, 2023, which has currently automatically renewed for an additional one-year term and will continue to automatically renew for additional one-year terms thereafter unless termination in accordance with its terms. In connection with this amendment, effective as of April 1, 2018, Ms. Goldstein’s base salary was increased to a fixed salary of $850,000 for the remainder of the agreement term, with no automatic, annual cost of living increases, but subject to increase from time to time, as determined by the Company. On May 24, 2022, the Compensation Committee approved an increase to Ms. Goldstein’s base salary for fiscal 2023, effective April 1, 2022, to $1,000,000, based on Ms. Goldstein’s strong individual performance and value to the organization as a key senior leader and peer benchmarking. Ms. Goldstein’s base salary will remain the same for fiscal 2024.

Mr. Emerson’s base salary was $675,000 in fiscal 2022 and was increased to $850,000 in fiscal 2023 based on Mr. Emerson’s strong individual performance and value to the organization as a key senior leader and peer benchmarking. Mr. Emerson’s base salary will remain the same for fiscal 2024.

Annual Cash Incentive

The Compensation Committee has the authority to award annual performance-based cash bonuses to the NEOs pursuant to their employment agreements with the Company. The Compensation Committee believes that an annual performance-based bonus opportunity provides the incentives necessary to retain our NEOs and reward them for their attainment of the Company’s business goals.

Annual bonus awards for Ms. Goldstein and Mr. Emerson are 100% performance-based and solely dependent on achievement of budgeted Adjusted EBITDA for the applicable fiscal year. Budgeted Adjusted EBITDA targets are pre-determined at the beginning of the applicable fiscal year. The Compensation Committee believes that using budgeted Adjusted EBITDA as the core performance metric in the annual bonus design represents an appropriate measure of the Company’s performance and an appropriate way to align NEOs’ short-term incentives with our shareholders’ interests. For a description of the Board’s target-setting process as well as disclosure regarding how we fared against that target please see the above sections titled “Annual Incentive Plan Target Setting” and “Annual Incentive Plan Achievement” on page __.

Bonus amounts for Ms. Goldstein and Mr. Emerson in fiscal 2023 were a function of Adjusted EBITDA relative to target, as set forth in the following table:

Budgeted Adjusted EBITDA for fiscal 2023 was $1,187.6 million and the Company achieved actual Adjusted EBITDA of $940.6 million. This Adjusted EBITDA achievement was approximately 79.2% of the budgeted Adjusted EBITDA, which was less than the threshold of 80% of the budgeted Adjusted EBITDA, and therefore Ms. Goldstein and Mr. Emerson did not receive an annual cash bonus for fiscal 2023.

Long-Term Equity Incentives

Equity is an essential tool to attract and retain highly-skilled employees, including key creative and technical talent, and it aligns the interests of creative employees with our shareholders. Our creative employees at our labels drive our business, are critical to our continued success, and help us build shareholder value. We also believe that equity-based awards are an important factor in aligning the long-term financial interests of the NEOs and certain other employees of the Company with its shareholders. The Compensation Committee continually evaluates the use of equity-based awards and intends to continue to use such awards in the future as part of designing and administering the Company’s compensation program. Equity-based awards are generally granted to new key employees on a quarterly basis following the commencement of employment and to existing key employees on an annual basis and following a significant change in job responsibilities or to meet other special retention objectives.

Our compensation program design, and in particular the use of equity awards as a key incentive element, establishes strong links between our creative teams and long-term value creation for shareholders. Our long-term equity incentive program reflects the importance of creative talent to our business and allows Take-Two to retain and incentivize key talent.

All grants made to employees, including the NEOs, are approved by the Compensation Committee. The current outstanding awards granted to our NEOs are governed by the Company’s 2017 Stock Incentive Plan, as amended and restated (the “2017 Plan”), which is discussed further in “Executive Compensation—Narrative Disclosure Regarding Equity Plans and Employment Agreements.”

The Company generally uses a mix of performance-based and time-based vesting for NEO long-term equity incentive grants to achieve separate and distinct purposes. Performance-based vesting awards support the goal of retention as well as alignment of the executives’ incentives with the interests of the Company’s shareholders, while time-based vesting awards emphasize the retention of skilled executives.

NEO Long-Term Incentives Awarded in Fiscal 2023

In May 2022, the Compensation Committee determined that in June 2022 the Company would issue:

The purpose of these one-time transition awards was solely to fill a short-term gap in vesting and value in fiscal 2025 created by the lengthening of the performance and vesting periods from (i) two to three years with respect to the performance-based shares, and (ii) three to four years with respect to the time-based shares, in each case granted to Mr. Emerson and Ms. Goldstein in fiscal 2023. The transition awards cliff vest in two years and are comprised of 67% performance-based shares based on relative TSR performance. Such transition grants are intended to promote retention and ensure that our NEOs’ priorities remain aligned with those of our shareholders during such transition period. In sizing the transition awards, the Compensation Committee analyzed the estimated number of RSUs that would have otherwise vested during the transition period had the Company maintained its prior long-term incentive structure.

The number of RSUs included in each of the above grants was determined by dividing the grant value by the average of the closing prices of the Company’s common stock on the 10 trading days immediately prior to June 1, 2022. The increase in the annual grants for fiscal 2023 made in June 2022 are based on the exceptional performance of Mr. Emerson and Ms. Goldstein and the competitive pay review of the Company’s new peer group based on the completion of the acquisition of Zynga in May 2022.

The Compensation Committee made the fiscal 2023 grants in the form of RSUs, rather than restricted stock, in order to preserve flexibility to settle the awards in stock, cash or a combination of stock and cash. A portion of these RSUs, equal to 66.7% of the value at target, are performance-based subject to satisfaction of TSR performance criteria during the vesting period (described in more detail below). The remaining portion of these RSUs, equal to 33.3% of the value at target, consisted of time-based RSUs and vest as described below based on continued service with the Company.

The RSUs are comprised of:

For the annual grant, the number of shares of common stock that may be issued upon vesting of the performance-based RSUs assumes the achievement of the target performance criteria established by the Compensation Committee; however, the actual number of such shares may range from zero to a maximum of 45,774 for Mr. Emerson and 66,700 for Ms. Goldstein (in each case equal to 200% of target).

For the one-time transition grant, the number of shares of common stock that may be issued upon vesting of the performance-based RSUs assumes the achievement of the target performance criteria established by the Compensation Committee; however, the actual number of such shares may range from zero to a maximum of 16,348 for Mr. Emerson and 21,796 for Ms. Goldstein (in each case equal to 200% of target).

The relative TSR metric is measured against companies in the Nasdaq 100 Index over a period of approximately three years for the annual grants made in fiscal 2023 (with this period being from June 1, 2022, to March 31, 2025) to determine achievement of TSR goals. To the extent earned, the awards vest 100% upon the third anniversary of the grant date. The TSR performance schedule is as follows with proration on a straight-line basis between the amounts listed:

The awards for fiscal 2023 were as follows:

NEO Long-Term Incentive Awards Vested in Fiscal 2023

The results and payout levels for the performance-based RSUs granted to Ms. Goldstein and Mr. Emerson prior to fiscal 2023 that vested, or failed to vest, in fiscal 2023, are as follows:

Additionally, the compensation received by the NEOs is strongly aligned with the Company’s outperformance on TSR during the same period as evidenced by our ranking in the top quartile (above 75^th percentile) of all companies in the Nasdaq Composite Index for the two-year measurement periods that ended on March 31, 2019, 2020 and 2021 and the top half (above 50^th percentile) of the two-year measurement periods that ended on each of March 31, 2022 and March 31, 2023.

For a description of the results and payout levels for performance-based RSUs previously granted to ZMC that vested, or failed to vest, in fiscal 2023, see “Certain Relationships and Related Transactions—Management Agreement.”

NEO Long-Term Incentives Awarded in Fiscal 2024

In May 2023, the Compensation Committee determined that the Company would issue the following RSUs to Mr. Emerson and Ms. Goldstein:

SEC regulations generally require that the grant date fair value of equity awards be disclosed in the Summary Compensation Table for the year in which the equity awards were granted, not the year to which the services relate. As a result, the grant date value for equity grants made in June 2022 are shown in the Summary Compensation Table on page 56, and the grant date value for the equity grants made in June 2023 will be reflected in the Summary Compensation Table in our Proxy Statement for the 2024 Annual Meeting of Shareholders.

Other Compensation

401(k) Plan

We maintain a 401(k) savings plan and trust for our eligible employees, including our NEOs (other than Messrs. Zelnick and Slatoff). The plan permits each participant to make voluntary pre-tax contributions, post-tax “Roth” contributions or a combination of the two. In addition, we make matching contributions equal to 50% of the participant’s eligible elective deferral (excluding catch-up contributions) contributed to the 401(k) savings plan, but not more than an amount equal to 50% of the first 6% of the participant’s pre-tax and/or Roth contributions will be matched. See the “All Other Compensation” column in the Summary Compensation Table for further information regarding these benefits.

Executive Supplemental Benefits

We maintain an Executive Dental, Vision and Hospital Indemnity Benefits Plan (the “ESB”) for all of the NEOs, including for this purpose Messrs. Zelnick and Slatoff. Pursuant to the ESB, the participating NEOs are reimbursed for, dental, vision and certain hospital expenses that are not otherwise reimbursed by our group insurance program.

Other Benefits and Perquisites

We provide health insurance, dental insurance, life and accidental death and dismemberment insurance and short-term and long-term disability benefits for our NEOs, including for this purpose Messrs. Zelnick and Slatoff, on the same basis as such benefits are generally provided to our employees. In addition, we pay a club membership fee on behalf of Mr. Zelnick, which is used primarily for general corporate and corporate development purposes, for a parking spot at our corporate office in New York, and for home security measures for Mr. Zelnick. We consider the security measures provided to Mr. Zelnick to be a reasonable and necessary expense for the Company’s benefit. Other than the ESB, the club membership fee, the parking spot and home security for Mr. Zelnick, no material perquisites are provided to our NEOs. We do not have a formal perquisite policy and do not emphasize special perquisites for our executive officers, although the Compensation Committee periodically reviews perquisites for our executive officers in its review of compensation.

Severance and Change in Control Benefits

Severance and Change in Control Benefits for ZMC

Pursuant to the Management Agreement, ZMC would receive the following cash payments and benefits upon a termination by the Company without “cause” or by ZMC for “good reason” (whether before or after a change in control) (as such terms are defined in the Management Agreement): (i) the earned but unpaid portion of the management fee, (ii) any accrued but unpaid annual bonus for a completed fiscal year and (iii) three times the sum of the per annum management fee plus the target bonus amount. In addition, the Management Agreement provides for certain accelerated vesting of outstanding and unvested equity awards upon such a termination.

See “Certain Relationships and Related Transactions—Management Agreement” for more details.

The cash payments described above remain consistent whether the termination occurs before or after a change in control, so ZMC is not entitled to receive any enhanced cash payments in connection with a change in control. With respect to vesting of equity awards in connection with a change in control, the Management Agreement provides for “double-trigger” vesting (that is, they require both a change in control of the Company plus a qualifying termination before payments and benefits are paid). Accordingly, if a change in control occurs during the term of the Management Agreement, outstanding and unvested equity awards will continue to vest (and performance-based RSUs will continue to vest at target levels) in accordance with the original vesting schedule, subject to earlier vesting upon a termination of the Management Agreement without cause or for good reason.

Severance and Change in Control Benefits for Other NEOs

In March 2008, the Compensation Committee approved the Take-Two Interactive Software, Inc. Change in Control Employee Severance Plan (the “CIC Severance Plan”), a change in control plan pursuant to which certain eligible employees, including the NEOs other than Messrs. Zelnick and Slatoff, may receive certain “double-trigger” cash severance benefits upon a termination of employment either by the Company without “cause” or voluntarily for “good reason” (as such terms are defined in the CIC Severance Plan), in either case during the 12-month period following a change in control of the Company, as well as vesting of outstanding and unvested equity awards in connection with a change in control of the Company, as described under “Executive Compensation—Potential Payments Upon Termination or Change in Control” below. The employment agreements with Ms. Goldstein and Mr. Emerson provide for severance payments in the event of a separation from service from the Company under certain conditions, as well as a retention bonus payment to Ms. Goldstein that is payable only if Ms. Goldstein stays employed in connection with a change in control of the Company. Ms. Goldstein and Mr. Emerson only receive benefits under the CIC Severance Plan to the extent such benefits would be greater than the benefits under their employment agreements. See “Executive Compensation—Narrative Disclosure Regarding Equity Plans and Employment Agreements” and “Executive Compensation—Potential Payments Upon Termination or Change in Control” below for more information. We believe that these severance benefits assist us in recruiting talented individuals to join and remain a part of our management team. From time to time, we may recruit executives from other companies where they have job security, tenure and career opportunities. Accepting a position with us may entail foregoing an otherwise secure position at another employer, and the benefits provided by the CIC Severance Plan help to mitigate the risk of harm that the executive may suffer in connection with adverse actions taken by a successor to the Company. Severance benefits also allow our NEOs to focus on the Company’s business without being unduly distracted by concerns about their job security in the event of a separation from service or a change in control. Our NEOs are not entitled to any gross-up payments to cover excise taxes imposed by the “golden parachute” regulations under Sections 280G and 4999 of the Internal Revenue Code, as amended (the “Code”).

VI. Operation of the Compensation Committee

General

The Compensation Committee annually reviews compensation policies and procedures of the Company and evaluates and approves the NEOs’ compensation. The Compensation Committee also annually reviews the ZMC relationship. This review includes annual individual interviews with a broad group of executives, excluding our Executive Chairman and CEO and our President, to seek feedback on the ZMC relationship.

The Compensation Committee held 10 meetings during fiscal 2023. The Compensation Committee regularly meets at least four times during the fiscal year.

Role of Management

When determining NEO compensation, the Compensation Committee solicits from the Executive Chairman and CEO an evaluation of the performance of, and recommendations with respect to compensation decisions for, each of the NEOs other than himself. In addition, with respect to setting compensation for fiscal 2023, the Compensation Committee interviewed all of the NEOs, including the CEO and President, and members of our management team who report to the NEOs in order to better assess each NEO’s performance. The Compensation Committee also interviewed certain of the foregoing individuals in connection with its annual review, in conjunction with the Board of Directors, of ZMC’s performance.

Use of Outside Advisors

The Compensation Committee has historically engaged the services of independent compensation consulting firms in connection with making executive compensation determinations. Consistent with our practice, the Compensation Committee retained FW Cook to review the compensation programs for our NEOs and our Board of Directors for fiscal 2023, and to develop recommendations regarding our compensation programs for fiscal 2023 and fiscal 2024.

The Compensation Committee has the authority to retain, terminate and set the terms of the Company’s relationship with any outside advisors that assist the Compensation Committee in carrying out its responsibilities.

The Compensation Committee assessed the independence of FW Cook pursuant to SEC and Nasdaq rules and was satisfied that the firm is independent and that no conflict of interest exists that would prevent it from serving as an independent advisor to the Compensation Committee. The Compensation Committee, among other things, reviewed and was satisfied with the consultant’s policies and procedures to prevent or mitigate conflicts of interest. The Compensation Committee also reviewed and was satisfied that there were no business or personal relationships or conflicts between members of the Compensation Committee and the individuals at the consulting firm supporting the Compensation Committee.

VII. Compensation Governance Practices

Clawback Policy

Our Corporate Governance Guidelines include a section entitled “Recovery of Improperly-Awarded Incentive Compensation” which is our “Clawback Policy.” Our NEOs (including ZMC and its shareholders, partners, employees, members and other affiliates who are deemed “Executives” under the Clawback Policy) are subject to the Clawback Policy. Our Corporate Governance Guidelines, including our Clawback Policy, are available on the Company’s website at www.take2games.com by clicking on “Policies & Conduct,” then “Guidelines for Directors and Board Governance.”

Our Clawback Policy requires the reimbursement of any bonus or incentive compensation, including cash bonuses, awarded to a covered person and/or the cancellation of unvested restricted stock or outstanding stock option awards previously granted to a covered person, in each case, where: (1) the payment was predicated upon achieving certain financial results that were subsequently determined to have been erroneously reported; (2) the Board of Directors determines that the person engaged in knowing or intentional fraudulent or illegal conduct that caused or substantially caused such erroneous reporting to have occurred; and (3) a lower payment would have been made to the person based upon the corrected financial results. Our Clawback Policy will be updated to reflect the Nasdaq listing standards approved in connection with the clawback rule recently adopted by the SEC in advance of the effective date.

Executive Officer Stock Ownership Requirements and Holding Requirement

The Company has adopted stock ownership requirements for executive officers of the Company as follows:

Executive Chairman and CEO and President

The 2022 Management Agreement and the stock ownership guidelines policy adopted by the Board of Directors both prohibit, prior to March 31, 2029, ZMC and any Subject Person (as defined in the 2022 Management Agreement, and which includes each of Messrs. Zelnick and Slatoff individually) from selling or otherwise disposing of any shares of common stock of the Company, if the Market Value (as defined in the 2022 Management Agreement) of all shares of common stock of the Company (including any unvested options, restricted stock and RSUs, but excluding any unvested options, restricted stock or RSUs that remain subject to performance-based vesting) would be less than six (6) times the per annum management fee (excluding any bonuses).

Other NEOs

NEOs (other than the Executive Chairman and CEO and President who are subject to the requirements described above) shall own shares of common stock having a value equal to three (3) times their annual base salary within five (5) years after the date of the adoption of the requirements and future NEOs shall achieve such ownership position within five (5) years after the date of their appointment as NEOs. All shares that are directly owned by the NEO, shares that are beneficially owned by the NEO, such as shares held in “street name” through a broker or shares held in trust, and unvested shares of restricted stock and RSUs (other than any unvested restricted stock or RSUs that remain subject to performance-based vesting) are counted toward satisfying the requirements.

The policy adopted by the Board of Directors also includes stock retention guidelines for all NEOs requiring such officers to retain at least 50% of the total equity credited from grants of equity awards (net of amounts required to pay taxes and exercise prices) until compliance with the applicable stock ownership requirement is achieved. All NEOs are in compliance with the applicable stock ownership requirements as of the date of this proxy filing.

Anti-Hedging Policy

The Company has adopted a Securities Trading Policy that prohibits, among other things, officers, directors, employees and consultants of the Company, as well as the shareholders, partners, employees, members, and other affiliates of ZMC who are service providers to the Company subject to such policy, from engaging in the following transactions:

Anti-Pledging Policy

As a matter of good corporate governance, our Board of Directors has adopted a formal policy against pledging common stock pursuant to which members of the Board of Directors and executive officers may not hold common stock in margin accounts and may not pledge common stock as collateral for a loan. None of our directors or executive officers has pledged any shares of our common stock.

Impact of Tax and Accounting Rules

As a general matter, the Compensation Committee reviews and considers the various tax and accounting implications of compensation vehicles utilized by the Company.

With respect to accounting considerations, the Compensation Committee examines the accounting cost associated with equity compensation in light of requirements under the Accounting Standards Codification (“ASC”) stock compensation guidance, which generally requires the Company to recognize compensation expense relating to equity awards based upon the grant date fair value of those awards. The Company also considers the accounting impact of preserving flexibility to settle RSUs awards in cash, shares, or a combination of cash and shares.

With respect to taxes, the Compensation Committee may consider the anticipated tax treatment of various payments and benefits to the Company and, when relevant, to its executives. Section 162(m) of the Code generally prohibits any publicly held corporation from taking a federal income tax deduction for compensation paid in excess of $1 million in any taxable year to the NEOs, subject to certain exceptions. However, the Company generally believes that it is in our best interest and that of our shareholders to have the flexibility to pay compensation that was not deductible under the limitations of Section 162(m) of the Code to provide a compensation package consistent with our program and objectives.

Report of the Compensation Committee of the Board of Directors

The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis contained in this Proxy Statement. Based upon this review and discussion, the Compensation Committee recommended to the Board of Directors of the Company that the Compensation Discussion and Analysis be included in this Proxy Statement.

Risk Assessment of Overall Compensation Program

The Compensation Committee regularly reviews senior executive compensation and Company-wide compensation programs and policies in an ongoing effort to seek to mitigate potential risks arising from such programs and policies and to ensure that our compensation structure, elements and incentives are not reasonably likely to have a material adverse effect on the Company.

The Compensation Committee seeks to design our compensation plans, including our incentive compensation programs, to incorporate a range of components that we believe help to mitigate potential risks, while rewarding employees for pursuing our strategic and financial objectives through appropriate risk taking, risk management, and prudent tactical and strategic decision making. For example, the design of our compensation plans is intended to encourage employees to remain focused on both near-term and longer-term goals of the Company by using a mix of short-term and long-term incentives to motivate employees to produce superior results over varying time frames. We believe that the use of long-term incentives for executives provides a safeguard against excessive risk-taking. Our long-term incentives are designed to deter unnecessary risk-taking by aligning our employees’ interests with those of shareholders by incorporating equity-based compensation that vests over time and, in some cases, include a market-based performance metric, which we believe is not susceptible to manipulation by employees and encourages employees to remain focused on sustained stock price appreciation; maintaining individual bonus caps for senior executives further mitigates risk.

We have also sought to deter unnecessary risk-taking by applying our clawback policy to the senior executives of the Company, which requires the reimbursement of bonus or incentive compensation and/or the cancellation of outstanding equity previously granted in certain cases.

In addition, our stock ownership guidelines require that each of our executive officers hold a significant amount of our common stock or equivalents to further align their interests with shareholders over the long term by having a portion of their personal investment portfolio consist of our common stock or equivalents. We expect this component to mitigate risk on a prospective basis. We also prohibit transactions designed to limit or eliminate economic risks to our employees of owning our common stock, such as options, puts, and calls, so our executives cannot insulate themselves from the effects of poor stock price performance.

Senior executives from our risk, compliance, administrative, and finance functions, as well as the outside compensation consultant to our Compensation Committee, are involved in this annual review process. With respect to fiscal 2023 and the compensation programs in place for fiscal 2023, based in part on the information and analyses provided by management and its own advisors, the Compensation Committee concluded that the Company’s compensation programs are not reasonably likely to have a material adverse effect on the Company.

EXECUTIVE COMPENSATION

The following table sets forth summary information for the fiscal years ended March 31, 2023, March 31, 2022, and March 31, 2021, with respect to cash and all other compensation paid by the Company to, or earned by, the Company’s NEOs.

Summary Compensation Table

Grants of Plan-Based Awards

The following table sets forth information concerning awards under the Company’s equity and non-equity incentive plans granted to each of the NEOs during fiscal 2023, including performance-based awards and those using time-based vesting. Assumptions used in the calculation of certain dollar amounts are included in Note 16 to the Company’s audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for fiscal 2023.