WWE, TKO Merger $147.5M Securities Class Action Settlement

Investors who held World Wrestling Entertainment Inc. Class A common stock and received, or had the right to receive, TKO Group Holdings Inc. common stock for their shares at the Sept. 12, 2023, closing of WWE's merger with Zuffa Parent LLC may be eligible to receive a cash payment from a class action settlement.

Vincent K. McMahon, Nick Khan, Paul Levesque, George A. Barrios and Michelle D. Wilson agreed to pay $147.5 million to settle a stockholder class action lawsuit alleging the process and price of WWE's merger with Zuffa Parent LLC, which owned and operated UFC, were unfair to WWE stockholders.

Who can file a claim?

The settlement class includes all record holders and beneficial owners of WWE Class A common stock whose shares the company exchanged for, or who had the right to receive, TKO common stock at the closing of the merger on Sept. 12, 2023.

Additional details

• Both individuals and entities can be class members.
• Investors who bought WWE shares before the closing of the merger but whose trades had not yet settled are class members for those shares.
• The class is a non-opt-out class under Delaware Court of Chancery rules 23(a), 23(b)(1) and 23(b)(2), meaning class members cannot exclude themselves from the settlement.

How much can class members get?

The total settlement fund is $147,500,000. The amount each class member receives depends on several factors:

• The number of eligible shares held at the closing of the merger on Sept. 12, 2023
• The total number of eligible shares in the class (estimated at about 53.8 million)
• The amount of the net settlement fund after court-approved deductions

The settlement administrator will distribute payments on a pro rata basis according to the court-approved plan of allocation:

• Each class member's payment equals the number of eligible shares they held at closing times the per-share recovery.
• The per-share recovery is the net settlement fund divided by the total number of eligible shares.
• For shares held in a "street name" through a broker, the settlement administrator will distribute payments to Depository Trust & Clearing Corp. participants, which will then distribute payments on a pro rata basis to beneficial owners.
• For shares held of record outside DTCC, the settlement administrator will distribute payments directly to the record holder.

No claim form needed to receive payment

Class members do not need to submit a claim form to receive payment. The settlement administrator will distribute payments the same way class members received their TKO shares in the merger. For shares held in a street name, the broker will deposit the payment into the same brokerage account that received the TKO shares.

Settlement administrator's mailing address: WWE Merger Litigation, c/o A.B. Data Ltd., P.O. Box 170700, Milwaukee, WI 53217

$147.5 million settlement fund

The $147,500,000 settlement fund includes:

• Settlement administration costs: To be determined
• Attorneys' fees and expenses: Up to $48,675,000
• Service awards to plaintiffs: Up to $10,000 total
• Payments to eligible class members: Remainder of the fund

Important dates

• Fairness hearing: Nov. 30, 2026

When is the WWE stockholder class action settlement payout date?

The settlement administrator will issue payments to eligible class members after the court resolves any appeals and grants final approval of the settlement.

Why did this class action settlement happen?

The class action lawsuit alleged the defendants pursued the merger to give McMahon a benefit other stockholders did not share and that a series of conflicts undermined the sale process. The plaintiffs also claimed the merger undervalued WWE and that the defendants failed to pursue alternative transactions.

The defendants denied all allegations of wrongdoing but agreed to settle to avoid the burden, expense and distraction of continued litigation.

Sources

1. Class notice
2. Settlement agreement