He's back: Mark Pincus returns to Zynga as CEO

Mark Pincus is back as CEO of Zynga, the struggling online game company he founded in 2007.

He's taking back the reins from Don Mattrick, the former head of Microsoft's Xbox division who took over from Pincus two years ago.

The San Francisco company says Mattrick is out as CEO and as a board member and Zynga employee, effective Wednesday.

Zynga is best known for games such as "FarmVille" and "Words With Friends." In its heyday, it was by far the most popular company on Facebook, but lost luster in recent years as people moved on to other games and to mobile devices.

Now, Zynga bills itself a "mobile-first" company. It says 60% of its bookings come from mobile players, up from 27% when Mattrick joined in 2013.

But its stock price hasn't followed. Mattrick was supposed to turn things around, but Zynga's stock is nearly the same as when he started and less than a third of the price of its 2011 initial public offering, $10.

"I believe the timing is now right for me to leave as CEO and let Mark lead the company into its next chapter," Mattrick said in a statement, adding that he plans to return to Canada to "pursue my next challenge."

While Zynga did not give a reason for his departure, the company's regulatory filings shed some light to the process. In July, Zynga said in a filing that Mattrick would only be entitled to severance pay and accelerated vesting of his stock units if the company terminates Mattrick without a cause, or if he "resigns in a constructive termination."

Based on Wednesday's filing, he is getting all the severance pay he was entitled to. This includes $4 million in severance pay, the accelerated vesting of 5.1 million unvested stock units (worth about $15 million) plus options to buy more, as well as a cash payments of either $1 million or the cash bonus he would have been entitled to in 2015, whichever is less.

Pincus will receive an annual salary of $1. He also owns more than 9% of Zynga's stock.

Zynga's shares fell 30 cents, or 10.3%, to $2.60 in after-hours trading following the announcement.

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