Subject: RP/Thoma Bravo Merger Agreement Quick Summary
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https://www.sec.gov/Archives/edgar/data/1286225/000119312520322436/0001193125-20-322436-index.htm
Merger Agreement Announced: 12/21/20
Merger Agreement Dated: 12/20/21
Merger Agreement Filed: 12/21/20
Merger Consideration: $88.75 cash
Go-Shop: 45 days (ends 11:59 pm NYC time 2/3/21)
No-Shop: 2/4/21
Termination Date: 9/20/21 or if marketing period not commenced; 3 business days after final date of marketing period
Termination Fee:
Company: $288M ($91M if superior proposal during go-shop)
Parent: $528M
Closing: 2 business days subject to satisfaction or waiver (2 business days after marketing period ended)
Confidentiality Agreement: 11/27/20
Regulatory:
HSR 10 business days (1/5/21)
Other Antitrust/Foreign Investment (Disclosure Letter) (1/18/21)Specified Consents
7.1 (c) Money Transmitter Licenses. The Specified Consents shall have been received; provided, however, that (x) unless Parent and the Company mutually agree in writing, the reference to “80%” in the definition of Material Jurisdictions shall be deemed to be a reference to “100%” until the Licensee Consent Deadline, (y) upon the earlier of the Licensee Consent Deadline or such date that Parent and Company mutually agree in writing, this condition shall be deemed satisfied by the receipt of the Specified Consents or any combination of Licensee Consents and Alternative Arrangements in the Material Jurisdictions, and (z) with respect to each jurisdiction for which a Licensee Consent is required prior to the Closing but that does not constitute a jurisdiction used to satisfy the 80% test within the definition of Material Jurisdiction for purposes of this condition, the Company shall, and shall cause Licensee to, in consultation with Parent, use their respective reasonable best efforts to implement an Alternative Arrangement to continue the lawful conduct of services in such non-Material Jurisdiction, and where such Alternative Arrangements cannot be implemented despite such reasonable best efforts, cease the conduct of services regulated by Licensee in such jurisdiction in accordance with the Law of such non-Material Jurisdiction (including surrendering the Money Transmitter License in accordance with such Law). Notwithstanding the foregoing, this condition shall not be deemed satisfied if the Alternative Arrangements and any other steps necessary to ensure compliance with applicable Law (including surrender of Money Transmitter Licenses) in such Material Jurisdictions and non-Material Jurisdictions, would, individually or in the aggregate, constitute a Company Material Adverse Effect, taking into account such Alternative Arrangements and steps and the effect thereof notwithstanding Section 1.1(ee)(vii) and Section 1.1(ee)(viii).
“Licensee Consent Deadline” means the date that is one hundred and fifty (150) days following the date hereof. (5/20/21)
Material Jurisdictions” means those jurisdictions in which Licensee provides regulated services pursuant to a Money Transmitter License issued by state banking departments, or other Governmental Authorities of states, that represent, in the aggregate (together with the state represented by “ZZ” in cell A43 of Section 1.1(xxx) of the Company Disclosure Letter, with states that do not require a Money Transmitter License to provide such services, and jurisdictions that do not require approval, consent, exemption, or waiver to consummate the Transactions), at least 80% of the “Fee Revenue” received by Licensee in the United States during the period of January 1, 2020 to November 30, 2020, as set forth on Section 1.1(xxx) of the Company Disclosure Letter.
(o) “Business Day” means each day that is not a Saturday, Sunday or other day on which the Company is closed for business or the Federal Reserve Bank of San Francisco is closed.
Best Efforts:
(II) In connection with obtaining any approvals or consents in connection with a change of control to the extent required by a Money Transmitter License of any Company Group Member, the Parties will use their respective reasonable best efforts following the Licensee Consent Deadline to implement, to the extent permissible by Law, Alternative Arrangements with respect to the operations of the Company Group governed by the Company Group’s Money Transmitter Licenses, such as payee agent arrangements or other uses of third parties, to permit the Closing to occur as promptly as practicable. Notwithstanding the foregoing, no Alternative Arrangement shall be implemented prior to the Licensee Consent Deadline without the prior written approval of Parent. Notwithstanding anything in this Agreement to the contrary (including Section 7.1(c)), the Parties agree to consider in good faith all available Alternative Arrangements in a particular jurisdiction before surrendering the Money Transmitter License in such jurisdiction. None of the Company Group Members shall publicly announce, or make any disclosures to any Governmental Authorities or customers with respect to, an intention to implement Alternative Arrangements prior to the Licensee Consent Deadline without the prior written approval of Parent (it being understood that in no event shall (x) the public disclosure of this Agreement or (y) the disclosure of this Agreement or any of the related transaction documents as requested or required by Law or any Governmental Authority, including by any state banking department or similar agency, be deemed a breach of this sentence). Without limitation of the preceding sentence (including the proviso therein), the Company shall provide any public announcement of, or any disclosure to Governmental Authorities or customers with respect to, any Alternative Arrangement to Parent a reasonable time prior to making such announcement or disclosure and consider in good faith any comments proposed by Parent or its Representatives. Any Alternative Arrangements in compliance with this Section 6.2(b)(II) shall be considered an approval for purposes of Section 7.1(c) and the 80% test within the definition of Material Jurisdiction. The Company shall use its commercially reasonable efforts to identify and disclose to Parent as promptly as practicable following the date of this Agreement any Payments Contract which would have been required to be disclosed in Section 3.5 of the Company Disclosure Letter had Payments Contracts been included within the definition of Material Contracts. For the avoidance of doubt, actions taken by the Company pursuant to this Section 6.2(b)(II) shall be deemed to be permitted pursuant to Sections 5.1 and 5.2.
(c) Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement shall require, or be construed to require, Parent, Merger Sub and/or any of their respective partners, equity holders, investment professionals, executives or Affiliates to (1) (A) make any payment to any third party (other than filing and application fees to Governmental Authorities (and related expenses incurred in connection therewith), payments to its third party Representatives working on its behalf to obtain approvals and consents or reasonable confirmations of compliance with obligations and reporting requirements) in order to obtain any consent or approval; or (B) (1) agree to invest any additional capital in Parent or any of its Subsidiaries or Affiliates or (2) take any action, or commit to take any action, or agree to any condition or restriction that would reasonably be expected to have a material adverse effect on the business, properties, assets, liabilities, results of operations or condition (financial or otherwise) of Parent or any material Affiliate of Parent, tak en as a whole.
Proxy: 20 business days (1/20/21)
Company S/H Vote: majority of outstanding
Voting Agreement: 10%
Dividends: N/A
Superior Proposal Notice: 4 business days; two business days extension to time remaining for material change
Governing Law: DE (NY for financing)
Dissenters Rights: Available
Marketing Period:means the first period of fifteen (15) consecutive Business Days commencing on the date that Parent has been provided the Required Financial Information; provided that (i) the Marketing Period shall end on any earlier date on which the Debt Financing is consummated and Parent shall have obtained all of the proceeds contemplated thereby; and (ii) the Marketing Period shall be deemed not to have commenced if, prior to the completion of such fifteen (15) consecutive Business Day period, the Company has announced any intention to restate, or the Company or its independent auditors have determined that the Company must restate, any financial statements included in the Required Financial Information, in which case the Marketing Period shall be deemed not to commence unless and until such restatement has been completed and the applicable Required Financial Information has been amended to reflect such restatement or the Company has or its independent auditors have, as applicable, announced or informed Parent that it has concluded that no restatement will be required. If at any time the Company shall reasonably believe that it has provided the Required Financial Information, the Company may deliver to Parent and Merger Sub a written notice to that effect (stating when it believes it completed such delivery), in which case the requirement to deliver the Required Financial Information will be deemed to have been satisfied on the date such notice is received, unless Parent in good faith reasonably believes the Company has not completed the delivery of the Required Financial Information and, within three (3) Business Days after the receipt of such notice from the Company, delivers a written notice to the Company to that effect (stating with specificity which portion(s) of the Required Financial Information the Company has not delivered or are otherwise unsuitable).
“Company Material Adverse Effect” means any change, event, effect or circumstance (each, an “Effect”) that is or would reasonably be expected to be materially adverse to the business, financial condition or results of operations of the Company Group, taken as a whole; provided, however, that, none of the following Effects with respect to the following matters (by itself or when aggregated) will be deemed to be or constitute a Company Material Adverse Effect or will be taken into account when determining whether a Company Material Adverse Effect has occurred or would reasonably be expected to occur (subject to the limitations set forth below):
(i) general economic conditions in the United States or any other country or region in the world, or changes in conditions in the global economy generally;
(ii) conditions in the financial markets, credit markets or capital markets in the United States or any other country or region in the world, including (1) changes in interest rates or credit ratings in the United States or any other country; (2) changes in exchange rates for the currencies of any country; or (3) any suspension of trading in securities (whether equity, debt, derivative or hybrid securities) generally on any securities exchange or over-the-counter market operating in the United States or any other country or region in the world;
(iii) conditions in the industries in which the Company Group or its customers generally conduct business;
(iv) regulatory, legislative or political conditions in the United States or any other country or region in the world;
(v) geopolitical conditions, outbreak of hostilities, acts of war, sabotage, terrorism or military actions (including any escalation or general worsening of any such hostilities, acts of war, sabotage, terrorism or military actions) in the United States or any other country or region in the world;
(vi) earthquakes, hurricanes, tsunamis, tornadoes, floods, mudslides, wildfires or other natural disasters, pandemics (including SARS-CoV-2 or COVID-19, any evolutions or mutations thereof or related or associated epidemics, pandemics or disease outbreaks (“COVID-19”)), epidemics or other outbreaks of diseases, quarantine restrictions, weather conditions and other force majeure events in the United States or any other country or region in the world (or escalation or worsening of any such events or occurrences, including, as applicable, second or subsequent wave(s));
(vii) resulting from the announcement or the existence of, compliance with, pendency of or performance under, this Agreement or the Transactions, including the impact thereof on the relationships, contractual or otherwise, of the Company Group with employees, suppliers, customers, partners, vendors or any other third Person; provided, however, that this clause (vii) shall not apply to any representation or warranty contained in this Agreement to the extent that such representation or warranty expressly addresses consequences resulting from the execution of this Agreement or the consummation or pendency of the Transactions;
(viii) the compliance by any Party with the terms of this Agreement, including any action expressly required to be taken or refrained from being taken pursuant to or in accordance with this Agreement, including the failure of the Company to take any action that the Company is specifically prohibited by the terms of this Agreement from taking to the extent Parent fails to give its consent thereto after a written request therefor pursuant to Section 5.2;
(ix) arising from any action taken or refrained from being taken, in each case to which Parent has expressly approved, consented to or requested in writing following the date hereof;
(x) changes or proposed changes in GAAP or other accounting standards or in any applicable laws or regulations (or the enforcement or interpretation of any of the foregoing);
(xi) (A) changes or proposed changes in Laws (or the enforcement or interpretation thereof) or (B) any quarantine, “shelter in place,” “stay at home,” workforce reduction, social distancing, shut down, closure, sequester, safety or similar Law, directive, guidelines or recommendations promulgated by any Governmental Authority, including the Centers for Disease Control and Prevention and the World Health Organization, in each case, in connection with or in response to COVID-19 (“COVID-19 Measures”);
(xii) price or trading volume of the Company Common Stock, in and of itself (it being understood that any cause of such change may be deemed to constitute, in and of itself, a Company Material Adverse Effect and may be taken into consideration when determining whether a Company Material Adverse Effect has occurred) or any change in the credit ratings or ratings outlook of any Company Group Member (provided that the underlying cause of such change in credit rating or rating outlook may be considered in determining if there has been a Company Material Adverse Effect);
(xiii) any failure, in and of itself, by the Company Group to meet (A) any public estimates or expectations of the Company’s revenue, earnings or other financial performance or results of operations for any period; or (B) any internal budgets, plans, projections or forecasts of its revenues, earnings or other financial performance or results of operations (it being understood that any cause of any such failure may be deemed to constitute, in and of itself, a Company Material Adverse Effect and may be taken into consideration when determining whether a Company Material Adverse Effect has occurred if not otherwise excluded hereunder);
(xiv) the availability or cost of equity, debt or other financing to Parent or Merger Sub;
(xv) any matter set forth in the Company Disclosure Letter; and
(xvi) any Transaction Litigation or other Legal Proceeding threatened, made or brought by any of the current or former Company Stockholders (on their own behalf or on behalf of the Company) against the Company, any of its executive officers or other employees or any member of the Company Board arising out of the Transactions;
except, with respect to clauses (i), (ii), (iii), (iv), (v), (vi), (x) and (xi) (other than, in the case of clauses (vi) or (xi), any Effect with respect to COVID-19 or the COVID-19 Measures or any escalation or worsening thereof (including any second or subsequent wave(s))) to the extent that such Effect has had a materially disproportionate adverse effect on the Company Group relative to other companies operating in the industry or industries in which the Company Group conducts business, in which case only the incremental disproportionate adverse impact may be taken into account in determining whether there has occurred a Company Material Adverse Effect.