NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON NOVEMBER 9, 2016
TO OUR SHAREHOLDERS:
NOTICE IS HEREBY GIVEN that a special meeting of the shareholders of Interactive Intelligence Group, Inc., an Indiana
corporation ("Interactive Intelligence," the
"Company," "we," "our" or "us"), will be held at our world headquarters located at 7601 Interactive Way, Indianapolis, Indiana 46278, on Wednesday, November 9, 2016 at 9:00 a.m. local
time (such meeting, including any adjournment or postponement thereof, the "special meeting"), to consider and vote upon the following proposals:
-
1.
-
To
approve the Agreement and Plan of Merger, dated as of August 30, 2016 (as it may be amended from time to time, the "merger agreement"), by and
among Interactive Intelligence, Genesys Telecommunications Laboratories, Inc., a California corporation ("Genesys"), Giant Merger Sub Inc., an Indiana corporation and a wholly owned
subsidiary of Genesys ("Merger Sub"), and, solely for the purposes of Section 5.16 of the merger agreement, Greeneden Lux 3 S.àR.L., a societe a responsabilite
limitee under the laws of Luxembourg, Greeneden U.S. Holdings I, LLC, a Delaware limited liability company, and Greeneden U.S. Holdings II, LLC, a Delaware limited liability
company;
-
2.
-
To
approve, on an advisory (non-binding) basis, certain compensation that may be paid or become payable to Interactive Intelligence's named executive
officers in connection with the merger; and
-
3.
-
To
approve the adjournment of the special meeting, if necessary or appropriate, including to solicit additional proxies if there are insufficient votes at
the time of the special meeting to approve the proposal to approve the merger agreement or in the absence of a quorum.
The Interactive Intelligence board of directors has fixed the close of business on September 30, 2016 as the record date for the determination of shareholders entitled to notice
of and to vote at the special meeting and at any adjournment or postponement thereof. Attendance at the special meeting will be limited to Interactive Intelligence shareholders as of the close of
business on the record date or their authorized representatives. You must present valid photo identification and proof of ownership of Interactive Intelligence common stock for admittance. See
"
The Special MeetingDate, Time and Place of the Special Meeting
" for further information.
After consideration of, and based upon, the unanimous recommendation of a special committee of the board of directors consisting entirely of independent and
disinterested directors (the "Independent Committee of the board of directors"), the Interactive Intelligence board of directors has unanimously approved the merger agreement and the transactions
contemplated by the merger agreement (including the merger), determined that the transactions contemplated by the merger agreement are fair to, advisable and in the best interests of Interactive
Intelligence and its shareholders and resolved to recommend that Interactive Intelligence shareholders vote in favor of the proposal to approve the merger agreement.
Accordingly,
the Interactive Intelligence board of directors unanimously recommends that the shareholders of Interactive Intelligence vote
(1) "
FOR
" the proposal to approve the merger agreement, (2) "
FOR
" the advisory
(non-binding) proposal to approve certain compensation that may be paid or become payable to Interactive Intelligence's named executive officers in connection with the merger and
(3) "
FOR
" the proposal to adjourn the special meeting, if necessary or appropriate, including to solicit additional proxies or in the absence of
a quorum.
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Your
vote is important, regardless of the number of shares of Interactive Intelligence common stock you own. The approval of the merger agreement by the affirmative vote of holders of a
majority of the outstanding shares of Interactive Intelligence common stock entitled to vote on the proposal is a condition to the completion of the merger.
Each
of the advisory (non-binding) proposal to approve certain compensation that may be paid or become payable to Interactive Intelligence's named executive officers in connection with
the merger and the proposal to adjourn the special meeting, if necessary or appropriate, including to solicit additional proxies or in the absence of a quorum, requires that more shares are voted
"
FOR
" such proposal than "
AGAINST
."
If
you hold your shares of record (
i.e.
, your name appears on the registered books of Interactive Intelligence), we request that you vote
your shares by proxy, even if you plan to attend the special meeting in person. To vote your shares by proxy, you should complete, sign, date and return the enclosed proxy card in the accompanying
postage-paid envelope or submit your proxy by telephone or over the internet by following the instructions on the enclosed proxy card, thereby ensuring that your shares of common stock will be
represented at the special meeting if you are unable to attend. In-person attendance at the special meeting does not by itself constitute a vote.
If
you hold your shares in "street name" (
i.e.
, you own your shares beneficially in the name of a stock brokerage account or by a bank,
trust or other nominee), we request that you provide your broker, bank or other nominee with instructions on how you would like it to vote your shares using the enclosed voting instruction form it
provided to you. If you as the street name holder do not provide timely instructions, the broker, bank or other nominee will not have the authority to vote on any of the proposals on your behalf.
Therefore, unless you attend the special meeting in person with a valid and properly executed legal proxy obtained from your broker, bank or other nominee, your failure to provide instructions to your
broker, bank or other nominee will result in your shares of Interactive Intelligence common stock not being present at the meeting and not being voted on any of the proposals.
Your
proxy card will count as a "vote" if you sign, date and return your proxy card without indicating how you wish to vote on a proposal. In this case your proxy will be voted
(1) "
FOR
" the proposal to approve the merger agreement, (2) "
FOR
" the advisory
(non-binding) proposal to approve certain compensation that may be paid or become payable to Interactive Intelligence's named executive officers in connection with the merger and
(3) "
FOR
" the proposal to adjourn the special meeting, if necessary or appropriate, including to solicit additional proxies or in the absence of
a quorum.
If you fail to vote (including if you fail to instruct your broker, bank or other nominee how you wish to vote), the effect will be that your shares of
Interactive Intelligence common stock will not be counted for purposes of determining whether a quorum is present at the special meeting and such failure will have the same effect as a vote "AGAINST"
the proposal to approve the merger agreement, but, assuming a quorum is present, will not have the effect of either a vote "FOR" or a vote "AGAINST" the advisory (non-binding) proposal to approve
certain compensation that may be paid or become payable to Interactive Intelligence's named executive officers in connection with the merger and the proposal to adjourn the special meeting, if
necessary or appropriate, including to solicit additional proxies or in the absence of a quorum.
As
a holder of Interactive Intelligence common stock, you are not entitled to exercise dissenters' rights under the Indiana Business Corporation Law. See "
No
Dissenters' Rights
."
You
may revoke your proxy by following the procedures outlined in the accompanying proxy statement.
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Before
voting your shares, we urge you to read the entire proxy statement carefully, including its annexes and the documents incorporated by reference into the proxy statement.
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By order of the Interactive Intelligence board of directors,
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Ashley A. Vukovits
Chief Financial Officer, Senior Vice President of Administration, Secretary and Treasurer
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Indianapolis, Indiana
October 3, 2016
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YOUR VOTE IS IMPORTANT
If your shares are registered directly in your name:
If you are a shareholder of record, you may vote your shares over the internet, by
telephone or
by mail as described below. Please help us save time and postage costs by voting over the internet or by telephone. Each method is generally available 24 hours a day and will ensure that your
vote is confirmed and posted immediately. To vote:
-
1.
-
BY INTERNET
-
a.
-
Go
to the website at
www.proxyvote.com
, 24 hours a day, seven days a week, until 11:59 p.m.
Eastern Time on November 8, 2016.
-
b.
-
Please
have your proxy card available to verify your identity and create an electronic ballot.
-
c.
-
Follow
the simple instructions provided.
-
2.
-
BY TELEPHONE
-
a.
-
On
a touch-tone telephone, call toll-free (800) 690-6903, 24 hours a day, seven days a week, until 11:59 p.m. Eastern Time on
November 8, 2016.
-
b.
-
Please
have your proxy card available to verify your identity.
-
c.
-
Follow
the simple instructions provided.
-
3.
-
BY MAIL
-
a.
-
Mark,
sign and date your proxy card.
-
b.
-
Return
it in the postage-paid envelope that will be provided.
If your shares are held in the name of a broker, bank or other nominee:
You will receive voting instructions from the organization
holding your
account and you must follow those instructions to vote your shares. As a beneficial owner, you have the right to direct your broker, bank or other nominee on how to vote the shares in your account.
Your broker, bank or other nominee cannot vote on any of the proposals, including the proposal to approve the merger agreement, without your instructions.
If
you fail to return your proxy card, grant your proxy electronically over the internet or by telephone or vote by ballot in person at the special meeting, your shares will not be
counted for purposes of determining whether a quorum is present at the special meeting. If you hold your shares through a broker, bank or other nominee, you must obtain from the record holder a valid
and properly executed legal proxy issued in your name in order to vote in person at the special meeting. A shareholder providing a proxy may revoke it at any time before it is exercised by providing
written notice of revocation to our Secretary or by providing a proxy of a later date.
We
encourage you to read the accompanying proxy statement, including its annexes and the documents incorporated by reference into the proxy statement, carefully and in their entirety. If
you have any questions concerning the merger, the special meeting or the accompanying proxy statement, would like additional copies of the accompanying proxy statement or need help voting your shares
of common stock, please contact our proxy solicitor:
MacKenzie
Partners, Inc.
105 Madison Avenue
New York, NY 10016
Email: proxy@mackenziepartners.com
Call collect: (212) 929-5500
Call toll-free: (800) 322-2885
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ii
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ANNEXES
iii
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SUMMARY
This summary highlights selected information from this proxy statement related to the merger of Giant Merger
Sub Inc. ("Merger Sub") with and into Interactive Intelligence Group, Inc. ("Interactive Intelligence"), with Interactive Intelligence surviving as a wholly owned subsidiary of Genesys
Telecommunications Laboratories, Inc. ("Genesys"), which transaction we refer to as the merger, and may not contain all of the information that is important to you. To understand the merger
more fully and for a more complete description of the legal terms of the merger, you should read carefully this entire proxy statement, the annexes to this proxy statement, including the Agreement and
Plan of Merger, dated as of August 30, 2016, by and among Interactive Intelligence, Genesys, Merger Sub, and, solely for the purposes of Section 5.16 of the merger agreement, Greeneden
Lux 3 S.àR.L., a societe a responsabilite limitee under the laws of Luxembourg, Greeneden U.S. Holdings I, LLC, a Delaware limited liability company, and Greeneden U.S. Holdings
II, LLC, a Delaware limited liability company (which, as it may be amended from time to time, we refer to as the "merger agreement"), and the documents we incorporate by reference in this proxy
statement. You may obtain the documents incorporated by reference into this proxy statement without charge by following the instructions under "Where You Can Find Additional Information" beginning on
page 106. The merger agreement is attached as
Annex A
to this proxy statement.
The Companies (page 25)
Interactive Intelligence Group, Inc.
Interactive Intelligence Group, Inc., referred to as "Interactive Intelligence," the "Company," "we," "our" or "us," is an
Indiana corporation. We are a global provider of software and cloud services for customer engagement, communication and collaboration. We offer three types of products: on-premises software known as
Interactive Intelligence Customer Interaction Center®; a single-tenant cloud service known as Interactive Intelligence Communications as a Service
SM
; and a multi-tenant cloud
service known as Interactive Intelligence PureCloud®.
Our
principal executive offices are located at 7601 Interactive Way, Indianapolis, Indiana 46278, and our telephone number is (317) 872-3000. For more information about
Interactive Intelligence, please visit our website at
www.inin.com
. Our website address is provided as an inactive textual reference only. The
information contained on, or accessible through, our website is not incorporated into, and does not form a part of, this proxy statement or any other report or document on file with or
furnished to the U.S. Securities and Exchange Commission, or the SEC. See also "
Where You Can Find Additional Information
."
Interactive Intelligence common stock is currently listed on The Nasdaq Global Select Market ("Nasdaq") under the symbol "ININ."
Genesys Telecommunications Laboratories, Inc.
Genesys Telecommunications Laboratories, Inc., referred to as "Genesys," empowers companies to create effortless omnichannel
customer experiences, journeys, and
relationships. Genesys is trusted by over 4,700 customers in 120 countries to orchestrate over 25 billion contact center interactions per year in the cloud and on premises. Genesys' principal
executive offices are located at 2001 Junipero Serra Boulevard, 9
th
Floor, Daly City, California 94014, and its telephone number is
(888) GENESYS (436-3797).
Giant Merger Sub Inc.
Giant Merger Sub Inc., referred to as "Merger Sub," is an Indiana corporation and a wholly owned subsidiary of Genesys that was
formed solely for the purpose of entering into the merger agreement and consummating the transactions contemplated by the merger agreement. Upon
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completion
of the merger, Merger Sub will cease to exist and Interactive Intelligence will continue as the surviving corporation. Merger Sub's principal executive offices are located at
2001 Junipero Serra Boulevard, 9
th
Floor, Daly City, California 94014, and its telephone number is (888) GENESYS (436-3797).
The Merger (page 33)
You will be asked to consider and vote upon the proposal to approve the merger agreement. A copy of the merger agreement is attached as
Annex A
. The merger agreement provides, among other things, that at the effective time of the merger (the "effective time"), Merger Sub will be
merged with and into Interactive Intelligence, and each issued and outstanding share of common stock, par value $0.01 per share, of Interactive Intelligence (the "Interactive Intelligence common
stock"), other than shares of common stock owned directly by Interactive Intelligence, Genesys or Merger Sub as of immediately prior to the effective time (the "cancelled shares") or shares of common
stock owned directly by any subsidiary of Interactive Intelligence, any subsidiary of Genesys (other than Merger Sub) or any subsidiary of Merger Sub as of immediately prior to the effective time (the
"converted shares"), will be converted automatically into the right to receive $60.50 in cash, without interest (the "merger consideration").
Material U.S. Federal Income Tax Consequences of the Merger (page 69)
If you are a U.S. holder (as defined under "
The Merger (Proposal 1)Material U.S. Federal Income
Tax Consequences of the Merger
"), the receipt of cash in exchange for shares of Interactive Intelligence common stock pursuant to the merger will generally be a taxable
transaction for U.S. federal income tax purposes, and may also be a taxable transaction under applicable state, local or foreign income or other tax laws. You should consult your own tax advisor to
determine the particular tax consequences to you of the exchange of shares of Interactive Intelligence common stock for cash pursuant to the merger in light of your particular circumstances (including
the applicability and effect of any state, local or foreign income and other tax laws).
The Special Meeting of Our Shareholders (page 26)
Place, Date and Time.
The special meeting will be held at 9:00 a.m. local time on November 9, 2016 at 7601 Interactive Way,
Indianapolis, Indiana 46278.
Purpose of the Special Meeting.
At the special meeting, you will be asked (1) to consider and vote on the proposal to approve the
Agreement
and Plan of Merger, dated as of August 30, 2016, by and among Interactive Intelligence, Genesys, Merger Sub and, solely for the purposes of Section 5.16 of the merger agreement,
Greeneden Lux 3 S.àR.L., Greeneden U.S. Holdings I, LLC and Greeneden U.S. Holdings II, LLC, pursuant to which Merger Sub will be merged with and into Interactive
Intelligence; (2) to consider and vote on the proposal to approve, on an advisory (non-binding) basis, certain compensation that may be paid or become payable to Interactive Intelligence's
named executive officers in connection with the merger; and (3) to consider and vote on the proposal to approve the adjournment of the special meeting, if necessary or appropriate, including to
solicit additional proxies if there are insufficient votes at the time of the special meeting to approve the proposal to approve the merger agreement or in the absence of a quorum.
Who Can Vote at the Meeting.
You can vote at the special meeting all of the shares of Interactive Intelligence common stock you own of
record as of
September 30, 2016, which is the record date for the special meeting. If you own shares that are registered in someone else's name, for example, a broker, you need to direct that person to vote
those shares or obtain a valid and properly executed legal proxy from them and vote the shares yourself at the meeting. As of September 30, 2016, there
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were 22,326,212 shares of Interactive Intelligence common stock outstanding held by approximately 83 holders of record.
What Vote is Required for Approval of the Merger Agreement.
Approval of the merger agreement requires that holders of a majority of the
shares of
Interactive Intelligence common stock outstanding at the close of business on the record date for the special meeting and entitled to vote on such proposal vote
"
FOR
" the proposal to approve the merger agreement. A failure to vote your shares of Interactive Intelligence common stock or an abstention from voting
will have the same effect as a vote "
AGAINST
" the proposal to approve the merger agreement. If your shares are held in "street name" by your broker,
bank or other nominee and you do not instruct the nominee how to vote your shares, such failure to instruct your nominee will have the same effect as a vote
"
AGAINST
" the proposal to approve the merger agreement. Dr. Brown, who owns approximately 17.1% of the outstanding voting power of Interactive
Intelligence common stock as of the record date, has already agreed to vote in favor of the proposal to approve the merger agreement. See "
The Merger (Proposal
1)Voting Agreement
" and "
The Voting Agreement
." Accordingly, approximately 39.7% of the other votes entitled to be
cast by shareholders that are not a party to the voting agreement must be cast in favor of the proposal to approve the merger agreement in order to approve the merger agreement.
Quorum.
A quorum will be present if holders of record of a majority of the shares of Interactive Intelligence common stock outstanding
on the close
of business on the record date and entitled to vote are present in person or represented by proxy at the special meeting. If a quorum is not present at the special meeting, the special meeting may be
adjourned or postponed from time to time until a quorum is obtained.
Procedure for Voting.
You can vote shares you hold of record by attending the special meeting and voting
in person or by mailing the enclosed proxy card or voting by telephone or over the internet. If your shares are held in "street name" by your broker, bank or other nominee, you should instruct your
broker, bank or other nominee on how to vote your shares using the instructions provided by your broker, bank or other nominee. If you do not instruct your broker, bank or other nominee to vote your
shares, your shares will not be voted, which will have the same effect as a vote "
AGAINST
" the proposal to approve the merger agreement. If you
participate in Interactive Intelligence's 401(k) Savings Plan (the "401(k) Plan"), you may give voting instructions to Bank of America Merrill Lynch Retirement Group, the plan Trustee, as to the
number of shares of Interactive Intelligence common stock credited to your 401(k) Plan account as of the most recent valuation date coincident with or preceding the record date by mailing the enclosed
voting instruction card or by providing voting instructions by telephone or over the internet, but you cannot vote those shares in person at the special meeting.
How to Revoke Your Proxy.
You may revoke your proxy at any time before the vote is taken at the special meeting. To revoke your proxy, you
must
either advise our Secretary in writing, deliver a new proxy in writing, by telephone or over the internet after the date of the proxy you wish to revoke, or attend the special meeting and vote your
shares in person. Merely attending the special meeting will not constitute revocation of your proxy. If you have instructed your broker, bank or other nominee to vote your shares, you must follow the
directions provided by your broker, bank or other nominee to change those instructions. If you are a participant in the 401(k) Plan, you may revoke previously given voting instructions for shares
credited to your account prior by November 7, 2016 at 11:59 p.m. Eastern Time, by delivering new voting instructions over the internet, by telephone or by mail.
Voting Agreement (page 95 and Annex B)
Concurrently with the execution and delivery of the merger agreement, Genesys entered into a voting agreement with Donald E. Brown,
M.D., our Chairman of the Board, Chief Executive Officer and President and a significant shareholder, pursuant to which Dr. Brown agreed, among other things,
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to vote the 3,827,448.56 shares of Interactive Intelligence common stock beneficially owned by him, which represent approximately 17.1% of the shares of Interactive Intelligence common stock issued
and outstanding on the record date, in favor of the merger agreement and the merger and against any other proposal or offer to acquire Interactive Intelligence. The voting agreement will not limit or
otherwise
affect the actions taken by Dr. Brown in his capacity as a director or officer of Interactive Intelligence or prohibit, limit or otherwise restrict him from exercising his fiduciary duties as a
director or officer of Interactive Intelligence or its subsidiaries. The voting agreement automatically terminates upon the earliest of (1) the effective time of the merger, (2) the
termination of the merger agreement in accordance with its terms, (3) the making of any change, by amendment, waiver or other modification to any provision of the merger agreement, that
decreases the amount or changes the form of the merger consideration, imposes any material restrictions on or additional conditions on the payment of the merger consideration or extends the "end date"
under the merger agreement, and (4) the end date. See "
The Merger (Proposal 1)Voting Agreement
," "
The Voting
Agreement
" and the voting agreement attached as
Annex B
to this proxy statement.
Voting by Interactive Intelligence's Directors and Executive Officers (page 28)
At the close of business on the record date, directors and executive officers of Interactive Intelligence were entitled to vote approximately 4,364,549 shares
of Interactive Intelligence common stock, which in the aggregate represented approximately 19.5% of the shares of Interactive Intelligence common stock issued and outstanding on such date. We
currently expect that Interactive Intelligence's directors and executive officers will vote their shares in favor of the proposal to approve the merger agreement and the other proposals to be
considered at the special meeting, although, other than Dr. Brown pursuant to the voting agreement described above, they have no obligation to do. See "
Security
Ownership of Certain Beneficial Owners and Management
."
Market Prices and Dividend Data (page 99)
Interactive Intelligence common stock is traded on Nasdaq under the symbol "ININ." The closing price of Interactive Intelligence common
stock on August 30, 2016, which was the last trading day before the merger was publicly announced, was $56.67 per share. The price of Interactive Intelligence common stock as of July 28,
2016, which was the last trading day before a Reuters news report was released indicating that Interactive Intelligence was exploring strategic alternatives, was $44.49 per share. On
September 30, 2016 the most recent practicable date before the date of this proxy statement, the closing price of Interactive Intelligence common stock was $60.14 per share. See
"
Market Price of Interactive Intelligence Common Stock
."
Under
the terms of the merger agreement, from the date of the merger agreement until the earlier of the effective time of the merger or the termination of the merger agreement,
Interactive Intelligence may not declare or pay quarterly cash dividends to its shareholders without Genesys' written consent.
Interactive Intelligence has never declared or paid any cash dividends on its common stock and has retained any earnings to finance and expand its operations and repay its outstanding debt.
Certain Effects of the Merger (page 33)
Pursuant to the terms of the merger agreement, Merger Sub will be merged with and into Interactive Intelligence, with Interactive
Intelligence surviving the merger. Throughout this proxy statement, we use the term surviving corporation to refer to Interactive Intelligence as the surviving corporation following the merger. If the
merger is consummated, you will not own any shares of the capital stock of the surviving corporation.
The
time at which the merger will become effective, which we refer to as the effective time, will occur at the time the articles of merger are filed with the Secretary of State of the
State of Indiana or
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at
such later date as may be agreed by Interactive Intelligence and Merger Sub and specified in the articles of merger.
Effects on Interactive Intelligence if the Merger is Not Completed (page 33)
If the merger agreement is not approved by our shareholders or if the merger is not consummated for any other reason, our shareholders will not receive any
payment for their shares of common stock. Instead, we will remain a public company, the Interactive Intelligence common stock will continue to be listed and traded on Nasdaq and registered under the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and we will continue to file periodic reports with the SEC. Under specified circumstances, we may be required to pay Genesys a
termination fee, or may be entitled to receive a reverse termination fee from Genesys, upon the termination of the merger agreement, as described under "
The Merger
AgreementTermination Fees
" on page 92.
Board of Directors' Recommendation (page 72)
After consideration of, and based upon, the unanimous recommendation of the Independent Committee of the board of directors, the
Interactive Intelligence board of directors unanimously approved the merger agreement and the transactions contemplated by the merger agreement (including the merger).
The
Interactive Intelligence board of directors unanimously recommends that Interactive Intelligence shareholders vote "FOR" the proposal to approve the merger agreement at the special
meeting.
Reasons for the Board of Directors' Recommendation to Vote in Favor of the Merger (page 42)
For a description of the reasons considered by the Interactive Intelligence board of directors in deciding to recommend that
shareholders vote in favor of the proposal to approve the merger agreement, see "
The Merger (Proposal 1)Reasons for the Board of Directors' Recommendation to Vote
in Favor of the Merger
."
Regulatory Approvals (page 71)
HSR Clearance.
Under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act") and the rules promulgated
thereunder, the
merger may not be completed until notifications have been given and information furnished to the Antitrust Division of the United States Department of Justice (the "Antitrust Division") and the United
States Federal Trade Commission (the "FTC") and all statutory waiting period requirements have been satisfied. Completion of the merger is subject to the expiration or termination of the applicable
waiting period under the HSR Act.
Other Jurisdictions.
Completion of the merger is also subject to obtaining the required approval under the applicable antitrust laws in
South Africa.
Conditions to Completion of the Merger (page 89)
The conditions to each party's obligation to complete the merger include the
following:
-
-
the approval of the merger agreement by at least a majority of the outstanding shares of Interactive Intelligence common stock
entitled to vote on the proposal;
-
-
the absence of any injunction or order by any court of competent jurisdiction that prohibits the consummation of the merger and the
absence of any law that prohibits or makes illegal the consummation of the merger;
-
-
the expiration or termination of the waiting period under the HSR Act and the receipt of South African antitrust approval;
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-
-
if a request by the Committee on Foreign Investment in the United States ("CFIUS") occurs prior to the effective time, the obtaining
of CFIUS clearance;
-
-
the accuracy of the other party's representations and warranties in the merger agreement, subject to certain qualifications;
-
-
the other party's material performance of and compliance with its covenants contained in the merger agreement; and
-
-
in the case of Genesys' obligations, there having been no material adverse effect with respect to Interactive Intelligence since
August 30, 2016.
When the Merger Becomes Effective (page 74)
As of the date of this proxy statement, the parties expect to complete the merger by the end of calendar year 2016. However, completion
of the merger is subject to the satisfaction or waiver of the conditions to the completion of the merger, and factors outside the control of Interactive Intelligence or Genesys may delay the
completion of the merger, or prevent it from being completed at all. There can be no assurances as to whether or when the merger will be completed.
Opinion of Interactive Intelligence's Financial Advisor (page 48 and Annex C)
In connection with the merger, Union Square Advisors LLC, our financial advisor (which we refer to as "Union Square"), rendered
to the Independent Committee of the board
of directors and the Interactive Intelligence board of directors its oral opinion, subsequently confirmed in writing, that as of August 30, 2016, and based upon and subject to the assumptions
made, procedures followed, matters considered and qualifications and limitations on the scope of review undertaken by Union Square as set forth in the written opinion, the merger consideration to be
received by the holders of Interactive Intelligence common stock (other than any shares of Interactive Intelligence common stock owned by Genesys, Merger Sub or Interactive Intelligence, or by any
direct or indirect subsidiary of Genesys, Merger Sub or Interactive Intelligence, which we refer to as the "excluded shares") pursuant to the merger agreement was fair, from a financial point of view,
to such holders.
The full text of the written opinion of Union Square to the Independent Committee of the board of directors and the Interactive Intelligence board of directors,
dated as of August 30, 2016, which sets forth, among other things, the assumptions made, procedures followed, matters considered and qualifications and limitations on the scope of the review
undertaken by Union Square in rendering its opinion, is attached as Annex C to this proxy statement and is incorporated by reference in this proxy statement in its entirety. The summary of the
opinion of Union Square in this proxy statement is qualified in its entirety by reference to the full text of the opinion. You are encouraged to read Union Square's opinion carefully and in its
entirety. Union Square's opinion was directed to the Independent Committee of the board of directors and the Interactive Intelligence board of directors, in their capacity as such, and addresses only
the fairness, from a financial point of view, of the merger consideration to be received by the holders of shares of Interactive Intelligence common stock (other than excluded shares) pursuant to the
merger agreement as of the date of the opinion and does not address any other aspects or implications of the merger or related transactions. Union Square's opinion was not intended to, and does not,
constitute advice or a recommendation as to how any holder of Interactive Intelligence common stock should vote at the special meeting or any other shareholders' meeting that may be held in connection
with the merger or whether the shareholders should take any other action in connection with the merger.
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Interests of Interactive Intelligence's Directors and Executive Officers in the Merger (page 58)
When considering the recommendation of the Interactive Intelligence board of directors that you vote in favor of the proposal to
approve the merger agreement, you should be aware that Interactive Intelligence's directors and executive officers may have interests in the merger that are different from, or in addition to, your
interests as a shareholder, including the following:
-
-
Under the terms of the merger agreement, certain unvested options to purchase Interactive Intelligence common stock ("stock options")
and certain unvested awards of Interactive Intelligence restricted stock units ("RSUs") held by Interactive Intelligence's directors and executive officers that are outstanding immediately prior to
the effective time will vest at the effective time and will be converted into the right to receive an amount in cash (less applicable withholdings and deductions) equal to the product of
(1) the per-share merger consideration of $60.50 (less, for stock options, the exercise price) and (2) the total number of shares subject to such stock options or RSUs, in an aggregate
amount of approximately $15.6 million.
-
-
Certain of Interactive Intelligence's executive officers are entitled to receive cash severance payments and benefits under their
respective change of control and retention agreements if the executive officer's employment is terminated by Interactive Intelligence for any reason other than for cause or as a result of the
executive officer's disability or if he or she resigns for good reason within six months following the occurrence of the good reason, and such termination by Interactive Intelligence or the good
reason occurs during the period commencing on August 31, 2016 (provided that the merger is completed) and ending on the date which is 18 months after the effective time (a "qualifying
termination"). The aggregate amount of salary and health benefits payable to the executive officers under their retention agreements upon a qualifying termination is approximately $1.5 million.
This does not include any amounts that may be payable with respect to the executive officers' performance-based cash bonuses due to the various assumptions utilized in calculating such payments, which
assumptions and amounts payable calculated in accordance with such assumptions are set forth in "
The Merger (Proposal 1)Interests of Interactive
Intelligence's Directors and Executive Officers in the MergerQuantification of Payments and Benefits to Interactive Intelligence's Executive Officers
."
-
-
Under the terms of the merger agreement, certain of Interactive Intelligence's executive officers are entitled to receive a prorated
portion of any actual earned annual bonus for 2016 if such executive officer is terminated after the effective time other than for cause. The calculation of the amounts that may be payable with
respect to the executive officers' performance-based cash bonuses are subject to various assumptions, which assumptions and amounts payable calculated in accordance with such assumptions are set forth
in "
The Merger (Proposal 1)Interests of Interactive Intelligence's Directors and Executive Officers in the MergerQuantification of Payments and
Benefits to Interactive Intelligence's Executive Officers
."
-
-
Interactive Intelligence's directors and officers are entitled to continued indemnification and directors' and officers' liability
insurance coverage and fiduciary liability insurance coverage for six years after the effective time.
For
a more complete description of these interests, see "
The Merger (Proposal 1)Interests of Interactive Intelligence's Directors and Executive Officers in the
Merger
."
The
Independent Committee of the board of directors was aware of these interests and considered them, among other matters, in evaluating and overseeing the negotiation of the merger
agreement, and in recommending that the board of directors approve the merger agreement and the merger. The Interactive Intelligence board of directors was also aware of these interests in approving
the merger agreement and the merger and in recommending that the merger agreement be approved by Interactive Intelligence's shareholders.
7
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Termination (page 90)
The merger agreement may be terminated:
-
-
by the mutual written consent of Interactive Intelligence and Genesys.
-
-
by either Interactive Intelligence or Genesys, if (subject to certain limitations):
-
-
the effective time has not occurred on or before January 31, 2017 (subject to an extension in certain
circumstances relating to regulatory approvals to May 30, 2017) (as may be extended, the "end date");
-
-
a court of competent jurisdiction has issued or entered a final and non-appealable injunction or similar order that
permanently enjoins or otherwise prohibits the consummation of the merger;
-
-
if the requisite vote of Interactive Intelligence shareholders to approve the merger agreement has not been obtained at
the special meeting; or
-
-
there is a breach or failure to perform in any material respect by the non-terminating party of the merger agreement such
that certain closing conditions would not be satisfied, that cannot be cured by the end date or, if curable, has not been cured within 30 business days of written notice of such breach or failure to
perform.
-
-
by Genesys, if at any time prior to the approval of the merger agreement by the Interactive Intelligence
shareholders:
-
-
the Interactive Intelligence board of directors has changed its recommendation that Interactive Intelligence shareholders
vote in favor of the proposal to approve the merger agreement;
-
-
Interactive Intelligence has entered into an alternative acquisition agreement;
-
-
the Interactive Intelligence board of directors or any committee thereof approves, endorses or recommends any alternative
proposal;
-
-
Interactive Intelligence or the Interactive Intelligence board of directors has publicly announced its intention to do
any of the items described in the three bullet points above;
-
-
Interactive Intelligence has breached or failed to perform in any material respect its obligations under the
non-solicitation provision in the merger agreement, described in "
The Merger AgreementNo Solicitation; Alternative Proposals
"; or
-
-
a tender or exchange offer relating to Interactive Intelligence's securities has been commenced by a person unaffiliated
with Genesys and Interactive Intelligence does not send to its security holders, within ten business days after such tender or exchange offer is first published, a statement disclosing that the
Interactive Intelligence board of directors recommends rejection of such tender or exchange offer.
-
-
by Interactive Intelligence:
-
-
at any time prior to the approval of the merger agreement by the Interactive Intelligence shareholders, if,
simultaneously with such termination Interactive Intelligence enters into a definitive agreement with respect to a superior proposal (see "
The Merger
AgreementChange in Board Recommendation
"), provided that the termination fee is paid concurrently with such termination; or
-
-
if (1) the marketing period has ended and Genesys is required to consummate the closing pursuant to the merger
agreement, (2) Genesys and Merger Sub fail to consummate the
8
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merger
within three business days of the first date on which Genesys and Merger Sub are required to consummate the closing, and (3) Interactive Intelligence provides irrevocable written notice
to Genesys
at least one business day prior to the first date confirming that it stands ready, willing and able to consummate the merger and the other transactions contemplated thereby.
Termination Fees (page 92)
Following termination of the merger agreement under specified circumstances generally relating to a competing transaction, Interactive
Intelligence may be required to pay Genesys a termination fee of $43 million. The merger agreement also provides that Genesys may be required to pay Interactive Intelligence a reverse
termination fee of $86 million under specified circumstances. In no event will either Interactive Intelligence or Genesys be required to pay the termination fee more than once.
Treatment of Interactive Intelligence Equity Awards; Employee Stock Purchase Plan (page 75)
Stock Options.
At the effective time, each stock option that is outstanding immediately prior to the effective time and that is vested as
of
August 30, 2016 or becomes vested prior to the effective time in accordance with its terms or the terms of the merger agreement will, as of the effective time, be converted into the right to
receive an amount in cash (less applicable withholdings and deductions) equal to the product of (x) the excess, if any, of $60.50 over the exercise price per share of such vested stock option
and (y) the total number of shares subject to such vested stock option. The merger agreement provides for (1) unvested stock options scheduled to vest on or prior to December 31,
2017 to vest at the effective time and (2) certain other unvested stock options of our directors, executive officers and certain of our other employees to vest at the effective time, as
described below under "
The Merger AgreementTreatment of Interactive Intelligence Equity Awards; Employee Stock Purchase Plan
."
Each
stock option that is outstanding immediately prior to the effective time and that is unvested immediately prior to the effective time (and does not become vested in accordance with
the terms of the merger agreement) will, as of the effective time, automatically convert into an award to receive an amount in cash equal to the product of (x) the excess, if any, of $60.50
over the exercise price per share of such unvested stock option and (y) the total number of shares subject to such unvested stock option.
Such converted award will remain subject to the same vesting terms and conditions that applied to such award immediately prior to the effective time, including continued employment through the
applicable vesting date. Payments will be made, less applicable withholdings and deductions, promptly following the applicable vesting date.
If
the applicable exercise price per share of any stock option equals or exceeds $60.50, such stock option will be cancelled without payment of additional consideration, and all rights
with respect to such stock option will terminate as of the effective time.
Restricted Stock Units.
At the effective time, each RSU that is outstanding immediately prior to the effective time that becomes vested at
the
effective time in accordance with its terms or the terms of the merger agreement will, as of the effective time, automatically convert into the right to receive an amount in cash (less applicable
withholdings and deductions) equal to the product of (x) the total number of shares subject to such vested RSU and (y) $60.50. The merger agreement provides for (1) unvested RSUs
scheduled to vest on or prior to December 31, 2017 to vest at the effective time and (2) certain other unvested RSUs of our directors, executive officers and certain of our other
employees to vest at the effective time, as described below under "
The Merger AgreementTreatment of Interactive Intelligence Equity Awards; Employee Stock Purchase
Plan
."
Each
RSU that is outstanding immediately prior to the effective time and that is unvested immediately prior to the effective time (and does not become vested in accordance with the terms
of the merger agreement) will, as of the effective time, automatically convert into an award to receive an
9
Table of Contents
amount
in cash equal to the product of (x) the total number of shares subject to such unvested RSU and (y) $60.50. Such converted award will remain subject to the same vesting terms and
conditions that applied to such award immediately prior to the effective time, including continued employment through the applicable vesting date. Payments will be made, less applicable withholdings
and deductions, promptly following the applicable vesting date.
Employee Stock Purchase Plan.
Interactive Intelligence has agreed that, as of no later than the business day immediately prior to the
effective time,
Interactive Intelligence will terminate the Interactive Intelligence Group, Inc. Employee Stock Purchase Plan, as amended and restated (the "ESPP"). Interactive Intelligence also has agreed
(1) that it will take all necessary action to ensure that no new purchase periods under the ESPP will commence during the period from August 30, 2016 through the
effective time, (2) that there was no increase in the amount of payroll deductions permitted to be made by the participants under the ESPP during the purchase period that ended
September 30, 2016, except those made in accordance with payroll deduction elections that already were in effect as of August 30, 2016, and (3) that no individual will commence
participation in the ESPP during the period from August 30, 2016 through the effective time. The accumulated contributions of the participants in the purchase period that ended
September 30, 2016 were used to purchase shares of Interactive Intelligence common stock as of October 3, 2016, and the participants' purchase rights under such offerings terminated
immediately after such purchase.
Employee Matters (page 86)
The merger agreement provides for the following treatment with respect to those employees of Interactive Intelligence and its
subsidiaries who continue to be employed by the surviving corporation or one of its subsidiaries after the effective time:
-
-
for the period of six months after the effective time (1) base salary or wages will be no less favorable than was provided to
the Interactive Intelligence employee immediately before the effective time and (2) all other compensation and benefits (excluding stock based benefits, if any), in the aggregate, will be no
less favorable than those provided to similarly situated employees of Genesys;
-
-
Genesys will or will cause the surviving corporation to provide to each continuing Interactive Intelligence employee whose employment
is terminated during the six-month period following the effective time severance benefits at the same level as the severance benefits that such employee would have been entitled under Interactive
Intelligence's benefit plans had such employee's employment been terminated in a severance qualifying termination immediately prior to the effective time;
-
-
each continuing Interactive Intelligence employee will receive full credit for his or her years of service with Interactive
Intelligence and its subsidiaries before the effective time, to the same extent as such Interactive Intelligence employee was entitled, before the effective time, to credit for such service under any
similar Interactive Intelligence benefit plan in which such employee participated or was eligible to participate immediately prior to the effective time;
-
-
each continuing Interactive Intelligence employee will be immediately eligible to participate in any and all benefit plans of Genesys
and its subsidiaries to the extent such plan supersedes a comparable Interactive Intelligence benefit plan in which such Interactive Intelligence employee participated immediately before the effective
time. For purposes of each benefit plan of Genesys and its subsidiaries providing medical, dental, pharmaceutical and/or vision benefits to any Interactive Intelligence employee, Genesys will cause
all pre-existing condition exclusions and actively-at-work requirements of such new plan to be waived for such employee and will cause any eligible expenses incurred by such employee and his or her
covered dependents during the portion of the plan year of the old plans ending on the date such employee's participation in the
10
Table of Contents
corresponding
new plan begins to be taken into account under such new plan for purposes of satisfying all deductible, coinsurance and maximum out-of-pocket requirements applicable to such employee and
his or her covered dependents for the applicable plan year as if such amounts had been paid in accordance with such new plan; and
-
-
each continuing Interactive Intelligence employee who is eligible to receive an annual cash bonus in 2016 will continue to participate
in such bonus program and bonus payments will be paid, subject to the achievement of applicable performance goals, based on the terms and conditions of the current plan. If, after the effective time,
a bonus plan participant's employment is terminated other than for "cause," the bonus plan participant will be entitled to receive a prorated portion of any actual earned annual bonus for 2016 based
on the number of days in 2016 that the employee was employed by Interactive Intelligence, Genesys or any of their respective subsidiaries, with such bonus to be payable at the same time as bonus
payments are made to employees who remain employed through the payment date.
No Solicitation; Alternative Proposals (page 82)
The merger agreement restricts Interactive Intelligence's ability to solicit or engage in discussions or negotiations with a third
party regarding competing transactions and the Interactive Intelligence board of directors' ability to change or withdraw its recommendation in favor of the merger agreement. Notwithstanding these
restrictions, under circumstances specified in the merger agreement, the Interactive Intelligence board of directors may respond to unsolicited competing proposals. See
"The
Merger AgreementNo Solicitation; Alternative Proposals
."
Change in Board Recommendation (page 84)
After consideration of, and based upon, the unanimous recommendation of the Independent Committee of the board of directors, the
Interactive Intelligence board of directors unanimously recommends that Interactive Intelligence shareholders vote "
FOR
" the proposal to approve the
merger agreement. Nevertheless, the Interactive Intelligence board of directors may make a change of recommendation or terminate the merger agreement to enter into a definitive agreement with respect
to a superior proposal (as defined in "
The Merger AgreementNo Solicitation; Alternative Proposals
") if Interactive Intelligence receives an
unsolicited written alternative proposal that the Interactive Intelligence board of directors, after consultation with outside financial and legal advisors, concludes is a superior proposal (taking
into account any binding commitments made by Genesys to amend the terms of the merger agreement).
Financing of the Merger (page 57)
We anticipate that the total amount of funds necessary to consummate the merger and the related transactions will be approximately
$2.8 billion, including the funds needed to (1) pay our shareholders the amounts due to them under the merger agreement; (2) make payments in respect of Interactive Intelligence's
outstanding stock options and RSUs pursuant to the merger agreement; (3) make any payments under our convertible notes, if required; (4) pay all fees and expenses payable by Genesys,
Merger Sub and their affiliates under the merger agreement and in connection with the related transactions and in connection with the debt financing under the debt commitment
letter described below; and (5) repay Genesys' existing debt in connection with the refinancing. This amount will be funded through a combination of Genesys' cash on hand and up to $2.8 billion
in debt financing under the debt commitment letter described below, and Interactive Intelligence's cash and cash equivalents on hand at the closing.
In
connection with the financing of the merger, Genesys and three of its affiliated parent companies, Greeneden Lux 3 S.àR.L., Greeneden U.S.
Holdings I, LLC, and Greeneden U.S.
11
Table of Contents
Holdings II, LLC,
have received a commitment letter, dated as of August 30, 2016, which, along with the related fee letter, we refer to as the "debt commitment letter," from Bank
of America, N.A., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Citigroup Global Markets Inc., Goldman Sachs Bank USA, and Royal Bank of Canada, which we refer to as the "debt
financing sources," pursuant to which the debt financing sources have committed to provide up to $2.8 billion in debt financing in connection with the merger and the related transactions.
The funding under the debt commitment letter is subject to certain customary conditions, including conditions that do not relate directly to the merger agreement. We believe the amounts
committed under the debt commitment letter will be sufficient to complete the transactions contemplated by the merger agreement, but we cannot be assured that the full amount of financing under the
debt commitment letter will be available or that the committed financing thereunder will be sufficient to complete the transactions contemplated by the merger agreement. The amounts committed might be
insufficient if, among other things, one or more of the parties to the debt commitment letter fails to fund the committed amounts in breach of the debt commitment letter or if the conditions to the
commitments to fund the amounts set forth in the debt commitment letter are not met. The failure of Genesys and Merger Sub to obtain any portion of the committed financing (or any alternate financing)
is likely to result in the failure of the merger to be consummated. In that case, Genesys may be obligated to pay a reverse termination fee to Interactive Intelligence, as described under
"
The Merger AgreementTermination Fees
" on page 92.
The
merger is not conditioned upon receipt of financing by Genesys.
Specific Enforcement (page 94)
Genesys, Merger Sub and Interactive Intelligence are entitled to a decree or order of specific performance enforcing covenants and
obligations contained in the merger agreement or an injunction or injunctions to prevent breaches or threatened breaches of the merger agreement in addition to any other remedy to which they are
entitled at law or in equity. Interactive Intelligence is entitled to obtain an injunction, specific performance or other equitable relief to cause Genesys and/or Merger Sub to consummate the
transactions contemplated by the merger agreement only upon the occurrence of certain events.
No Dissenters' Rights (page 104)
Under Chapter 44 of the Indiana Business Corporation Law (the "IBCL"), holders of shares that are entitled to
vote on a merger or similar transaction and that are traded on Nasdaq do not have the right to dissent and seek payment of the "fair value" of those shares involved in a merger. Interactive
Intelligence common stock is traded on Nasdaq and, accordingly, holders of shares of Interactive Intelligence common stock will not be entitled to exercise dissenters' rights in connection with the
merger.
12
Table of Contents
QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER
The following questions and answers address briefly some questions you may have regarding the special meeting
and the proposals to be voted on at the special meeting. These questions and answers may not address all of the questions that may be important to you as a shareholder of Interactive Intelligence.
Please refer to the more detailed information contained elsewhere in this proxy statement, the annexes to this proxy statement and the documents referred to or incorporated by reference in this proxy
statement, which we urge you to read carefully and in their entirety. You may obtain the information incorporated by reference into this proxy statement without charge by following the instructions
under "Where You Can Find Additional Information."
Q: Why am I receiving this proxy statement?
-
A:
-
On
August 30, 2016, Interactive Intelligence entered into a definitive agreement providing for the merger of Merger Sub, a wholly owned subsidiary of
Genesys, with and into Interactive Intelligence, with Interactive Intelligence surviving the merger as a wholly owned subsidiary of Genesys. You are receiving this proxy statement in connection with
the solicitation of proxies by the Interactive Intelligence board of directors in favor of the proposal to approve the merger agreement and to approve the other related proposals to be voted on at the
special meeting.
Q: What is a proxy?
-
A:
-
A
proxy is your legal designation of another person, referred to as a "proxy," to vote your shares of Interactive Intelligence common stock. The written
document describing the matters to be considered and voted on at the special meeting is called a "proxy statement." The document used to designate a proxy to vote your shares of Interactive
Intelligence common stock is called a "proxy card." The Interactive Intelligence board of directors has designated Edward L. Hamburg, Ph.D., and Mark E. Hill, and each of them with full power
of substitution, as proxies for the special meeting.
Q: When and where is the special meeting?
-
A:
-
The
special meeting will be held at Interactive Intelligence's world headquarters located at 7601 Interactive Way, Indianapolis, Indiana 46278, on
November 9, 2016 at 9:00 a.m. local time (including any adjournment or postponement thereof, the "special meeting").
Q: Who is entitled to vote at the special meeting?
-
A:
-
Only
holders of record of Interactive Intelligence common stock as of the close of business on September 30, 2016, the record date for the special
meeting, are entitled to receive notice of and to vote their shares at the special meeting. As of the close of business on the record date, there were 22,326,212 shares of Interactive Intelligence
common stock outstanding and entitled to vote at the special meeting, held by 83 holders of record. Each share of Interactive Intelligence common stock issued and outstanding as of the record date
will be entitled to one vote on each matter submitted to a vote at the special meeting.
Q: What is the difference between holding shares as a shareholder of record and as a beneficial owner?
-
A:
-
If
your shares are registered directly in your name with our transfer agent, Computershare Trust Company, N.A., you are considered, with respect to those
shares, to be the "shareholder of record." In this case, we have sent this proxy statement and your proxy card to you directly.
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Table of Contents
If
your shares are held through a broker, bank or other nominee, you are considered the "beneficial owner" of the shares of Interactive Intelligence common stock held in "street name." In that case,
this proxy statement has been forwarded to you by your broker, bank or other nominee who is considered, with respect to those shares, to be the shareholder of record. As the beneficial owner, you have
the right to direct your broker, bank or other nominee on how to vote your shares by following their instructions for voting. You are also invited to attend the special meeting. However, because you
are not the shareholder of record, you may not vote your shares in person at the special meeting unless you request and obtain a valid and properly executed legal proxy from your broker, bank or other
nominee.
Q: What matters will be voted on at the special meeting?
-
A:
-
You
will be asked to consider and vote on the following proposals:
-
-
to approve the merger agreement;
-
-
to approve, on an advisory (non-binding) basis, certain compensation that may be paid or become payable to Interactive Intelligence's
named executive officers in connection with the merger; and
-
-
to approve the adjournment of the special meeting, if necessary or appropriate, including to solicit additional proxies if there are
insufficient votes at the time of the special meeting to approve the proposal to approve the merger agreement or in the absence of a quorum.
Q: What is the proposed merger and what effects will it have on Interactive Intelligence?
-
A:
-
The
proposed merger is the merger of Merger Sub with Interactive Intelligence, with Interactive Intelligence surviving as a wholly owned subsidiary of
Genesys. If the proposal to approve the merger agreement is approved by the holders of Interactive Intelligence common stock and the other closing conditions under the merger agreement have been
satisfied or waived, Merger Sub will merge with and into Interactive Intelligence, with Interactive Intelligence continuing as the surviving corporation. As a result of the merger, Interactive
Intelligence will become a wholly owned subsidiary of Genesys. The Interactive Intelligence common stock will be delisted from Nasdaq and deregistered under the Exchange Act as soon as reasonably
practicable following the effective time of the merger, and at such time, we will no longer be a publicly traded company and will no longer be required to file periodic reports with the SEC with
respect to the Interactive Intelligence common stock. If the merger is consummated, you will not own any shares of the capital stock of the surviving corporation.
Q: What happens if the merger is not completed?
-
A:
-
If
the merger agreement is not approved by our shareholders or if the merger is not consummated for any other reason, our shareholders will not receive any
payment for their shares of common stock. Instead, we will remain a public company, the Interactive Intelligence common stock will continue to be listed and traded on Nasdaq and registered under the
Exchange Act and we will continue to file periodic reports with the SEC.
Under
specified circumstances, we may be required to pay Genesys a termination fee, or may be entitled to receive a reverse termination fee from Genesys, upon the termination of the merger agreement,
as described under "
The Merger AgreementTermination Fees
" on page 92.
Q: What will I receive if the merger is completed?
-
A:
-
Upon
completion of the merger, you will be entitled to receive the per-share merger consideration of $60.50 in cash, without interest and less any applicable
withholding taxes, for each share of
14
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common
stock that you own. For example, if you own 100 shares of common stock, you will receive $6,050 in cash in exchange for your shares of common stock, less any applicable withholding taxes. In
either case, you will not own shares in the surviving corporation.
-
Q:
-
What will the holders of Interactive Intelligence stock options and RSUs and the participants in the ESPP receive in the
merger?
-
A:
-
Stock Options
. Each stock option that is outstanding immediately prior to the effective time and
that is vested as of August 30, 2016 or becomes vested prior to the effective time in accordance with its terms or the terms of the merger agreement will, as of the effective time, be converted
into the right to receive an amount in cash (less applicable withholdings and deductions) equal to the product of (x) the excess, if any, of $60.50 over the exercise price per share of such
vested stock option and (y) the total number of shares subject to such vested stock option. The merger agreement provides for (1) unvested stock options scheduled to vest on or prior to
December 31, 2017 to vest at the effective time and (2) certain other unvested stock options of our directors, executive officers and certain of our other employees to vest at the
effective time, as described below under "
The Merger AgreementTreatment of Interactive Intelligence Equity Awards; Employee Stock Purchase
Plan
."
Each
stock option that is outstanding immediately prior to the effective time and that is unvested immediately prior to the effective time (and does not become vested in accordance with the terms of
the merger agreement) will, as of the effective time, automatically convert into an award to receive an amount in cash equal to the product of (x) the excess, if any, of $60.50 over the
exercise price per share of such unvested stock option and (y) the total number of shares subject to such unvested stock option. Such converted award will remain subject to the same vesting
terms and conditions that applied to such award immediately prior to the effective time, including continued employment through the applicable
vesting dates. Payments will be made, less applicable withholdings and deductions, promptly following the applicable vesting date.
If
the applicable exercise price per share of any stock option equals or exceeds $60.50, such stock option will be cancelled without payment of additional consideration, and all rights with respect to
such stock option will terminate as of the effective time.
Restricted Stock Units.
Each award of RSUs that is outstanding immediately prior to the effective time that becomes vested at the effective
time in accordance with its terms or the terms of the merger agreement will, as of the effective time, automatically convert into the right to receive an amount in cash (less applicable withholdings
and deductions) equal to the product of (x) the total number of shares subject to such vested RSU and (y) $60.50. The merger agreement provides for (1) unvested RSUs scheduled to
vest on or prior to December 31, 2017 to vest at the effective time and (2) certain other unvested RSUs of our directors, executive officers and certain of our other employees to vest at
the effective time, as described below under "
The Merger AgreementTreatment of Interactive Intelligence Equity Awards; Employee Stock Purchase
Plan
."
Each
RSU that is outstanding immediately prior to the effective time and that is unvested immediately prior to the effective time (and does not become vested in accordance with the terms of the merger
agreement) will, as of the effective time, automatically convert into an award to receive an amount in cash equal to the product of (x) the total number of shares subject to such unvested RSU
and (y) $60.50. Such converted award will remain subject to the same vesting terms and conditions that applied to such award immediately prior to the effective time, including continued
employment through the applicable vesting dates. Payments will be made, less applicable withholdings and deductions, promptly following the applicable vesting date.
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Employee Stock Purchase Plan.
Interactive Intelligence has agreed that, as of no later than the business day immediately prior to the
effective time, Interactive Intelligence will terminate the ESPP. Interactive Intelligence also has agreed (1) that it will take all necessary action to ensure that no new purchase periods
under the ESPP will commence during the period from August 30, 2016 through the effective time, (2) that there was no increase in the amount of payroll deductions permitted to be made by
the participants under the ESPP during the purchase period that ended September 30, 2016, except those made in accordance with payroll deduction elections that already were in effect as of
August 30, 2016, and (3) that no individual will commence participation in the ESPP during the period from August 30, 2016 through the effective time. The accumulated
contributions of the participants in the purchase period that ended September 30, 2016 were used to purchase shares of Interactive Intelligence common stock as of October 3, 2016, and
the participants' purchase rights under such offerings terminated immediately after such purchase. Participants in the ESPP will receive the $60.50 per-share merger consideration for each share the
participant holds in the ESPP as of the effective time of the merger.
Q: When do you expect the merger to be completed?
-
A:
-
We
are working toward completing the merger as quickly as possible and, as of the date of this proxy statement, expect to consummate the merger by the end of
calendar year 2016. However, the exact timing of completion of the merger cannot be predicted because the merger is subject to the satisfaction or waiver of certain conditions, including approval of
the merger agreement by our shareholders and the receipt of regulatory approvals. See "
The Merger AgreementWhen the Merger Becomes
Effective
" and "
The Merger AgreementConditions to Completion of the Merger
."
Q: Am I entitled to dissenters' rights under the Indiana Business Corporation Law?
-
A:
-
No.
As a holder of Interactive Intelligence common stock, you are not entitled to exercise dissenters' rights under the IBCL. See "
No
Dissenters' Rights
" on page 104.
-
Q:
-
Will I be subject to U.S. federal income tax upon the exchange of Interactive Intelligence common stock for cash pursuant to the
merger?
-
A:
-
If
you are a U.S. holder (as defined under "
The Merger (Proposal 1)Material U.S. Federal Income Tax Consequences of the
Merger
" beginning on page 69), the exchange of Interactive Intelligence common stock for cash pursuant to the merger generally will require a U.S. holder to recognize capital
gain or loss for U.S. federal income tax purposes in an amount equal to the difference, if any, between the amount of cash received by such U.S. holder pursuant to the merger and such U.S. holder's
adjusted tax basis in the shares of Interactive Intelligence common stock surrendered pursuant to the merger. Because particular circumstances may differ, we recommend that you consult your own tax
advisor to determine the U.S. federal income tax consequences relating to the merger in light of your own particular circumstances and any consequences arising under the laws of any state, local or
foreign taxing jurisdiction. A more complete description of the U.S. federal income tax consequences of the merger is provided under "
The Merger (Proposal
1)Material U.S. Federal Income Tax Consequences of the Merger
" beginning on page 69.
Q: How do I attend the special meeting?
-
A:
-
To
attend the meeting, you will need to present valid photo identification, such as a driver's license or passport, and proof of ownership of Interactive
Intelligence common stock. If your shares are held in the name of a broker, bank or other nominee, you will need to present a recent brokerage statement or letter from such entity reflecting your
stock ownership as of the record date. If you do not provide photo identification or comply with the other procedures outlined in this proxy
16
Table of Contents
statement,
you will not be admitted to the special meeting. For security reasons, you and your bags may be subject to search prior to your admittance to the meeting.
If
you are not a holder of record or beneficial owner as of the record date, you may be admitted to the meeting only if you have a valid and properly executed legal proxy from a holder of record as of
the record date. You must present that legal proxy, as well as a form of valid photo identification, at the entrance to the meeting.
Q: How many shares are needed to constitute a quorum?
-
A:
-
A
quorum will be present if holders of record of a majority of the shares of Interactive Intelligence common stock outstanding at the close of business on
the record date and entitled to vote are present in person or represented by proxy at the special meeting. If a quorum is not present at the special meeting, the special meeting may be adjourned or
postponed from time to time until a quorum is obtained.
If
you submit a proxy but fail to provide voting instructions or abstain on any of the proposals listed on the proxy card, your shares will be counted for the purpose of determining whether a quorum
is present at the special meeting.
If
your shares are held in "street name" by your broker, bank or other nominee and you do not instruct the nominee how to vote your shares, your broker, bank or other nominee will not vote on your
behalf with respect to any of the proposals, and your shares will not be counted for purposes of determining whether a quorum is present for the transaction of business at the special meeting.
Q: What vote of Interactive Intelligence shareholders is required to approve the merger agreement?
-
A:
-
Approval
of the merger agreement requires that the holders of a majority of the shares of Interactive Intelligence common stock outstanding at the close of
business on the record date for the special meeting and entitled to vote on such proposal vote "
FOR
" the proposal to approve the merger agreement. A
failure to vote your shares of Interactive Intelligence common stock or an abstention from voting will have the same effect as a vote "
AGAINST
" the
proposal to approve the merger agreement. If your shares are held in "street name" by your broker, bank or other nominee and you do not instruct the nominee how to vote your shares, such failure to
instruct your nominee will have the same effect as a vote "
AGAINST
" the proposal to approve the merger agreement. Dr. Brown, who owns
approximately 17.1% of the outstanding voting power of Interactive Intelligence common stock as of the record date, has already agreed to vote in favor of the proposal to approve the merger agreement.
See "
The Merger (Proposal 1)Voting Agreement
" and "
The Voting Agreement
." Accordingly,
approximately 39.7% of the other votes entitled to be cast by shareholders that are not a party to the voting agreement must be cast in favor of the proposal to approve the merger agreement in order
to approve the merger agreement.
-
Q:
-
What vote of Interactive Intelligence shareholders is required to approve the other proposals to be voted upon at the special
meeting?
-
A:
-
Each
of the advisory (non-binding) proposal to approve certain compensation that may be paid or become payable to Interactive Intelligence's named executive
officers in connection with the merger and the proposal to adjourn the special meeting, if necessary or appropriate, including to solicit additional proxies or in the absence of a quorum, requires
that more shares are voted "
FOR
" such proposal than "
AGAINST
."
An
abstention with respect to either proposal and a failure to vote your shares of Interactive Intelligence common stock on either proposal (including a failure of your broker, bank or other
17
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nominee
to vote shares held on your behalf), assuming a quorum is present, will not have the effect of either a vote "
FOR
" or a vote
"
AGAINST
" on such proposals.
Q: How does the Interactive Intelligence board of directors recommend that I vote?
-
A:
-
After consideration of, and based upon, the unanimous recommendation of the Independent Committee of the board of directors, the
Interactive Intelligence board of directors unanimously recommends that Interactive Intelligence shareholders vote:
-
-
"FOR" the proposal to approve the merger agreement;
-
-
"FOR" the advisory (non-binding) proposal to approve certain compensation that may be paid or become payable
to Interactive Intelligence's named executive officers in connection with the merger; and
-
-
"FOR" the proposal to adjourn the special meeting, if necessary or appropriate, including to solicit
additional proxies or in the absence of a quorum.
For
a discussion of the factors that the Interactive Intelligence board of directors considered in determining to recommend in favor of the proposal to approve the merger agreement, see
"
The Merger (Proposal 1)Reasons for the Board of Directors' Recommendation to Vote in Favor of the Merger
." In addition, in considering the
recommendation of the Interactive Intelligence board of directors with respect to the merger agreement, you should be aware that Interactive Intelligence's directors and executive officers may have
interests in the merger that are different from, or in addition to, the interests of Interactive Intelligence shareholders generally. For a discussion of these interests, see
"
The Merger (Proposal 1)Interests of Interactive Intelligence's Directors and Executive Officers in the Merger
."
Q: How do Interactive Intelligence's directors and officers intend to vote?
-
A:
-
In
connection with entry into the merger agreement, Dr. Brown, our Chairman of the Board, Chief Executive Officer and President, entered into a voting
agreement pursuant to which he agreed, among other things, to vote the 3,827,448.56 shares of Interactive Intelligence common stock beneficially owned by him, which represent approximately 17.1% of
the shares of Interactive Intelligence common stock issued and outstanding on the record date, in favor of the merger agreement and the merger and against any other proposal or offer to acquire
Interactive Intelligence. We currently expect that Interactive Intelligence's other directors and executive officers will vote their shares in favor of the proposal to approve the merger agreement and
the other proposals to be considered at the special meeting, although they have no obligation to do so.
-
Q:
-
What will happen if shareholders do not approve the advisory (non-binding) proposal on certain compensation that may be paid or
become payable to Interactive Intelligence's named executive officers in connection with the merger?
-
A:
-
The
inclusion of this proposal is required by the SEC rules; however, the approval of this proposal is not a condition to the completion of the merger and
the vote on this proposal is an advisory vote by shareholders and is not binding on Interactive Intelligence or Genesys. If the merger agreement is approved by Interactive Intelligence shareholders
and the merger is completed, the merger-related compensation will be paid to Interactive Intelligence's named executive officers in accordance with the terms of their compensation agreements and
arrangements even if shareholders do not approve this proposal.
18
Table of Contents
Q: What do I need to do now? How do I vote my shares of Interactive Intelligence common stock?
-
A:
-
We
urge you to read this entire proxy statement carefully, including its annexes and the documents incorporated by reference, and to consider how the merger
affects you. Your vote is important, regardless of the number of shares of Interactive Intelligence common stock you own.
We
encourage you to vote by proxy even if you plan on attending the special meeting.
Voting in Person
Shareholders
of record will be able to vote in person at the special meeting. We will give you a ballot when you arrive. If you are not a shareholder of record but instead hold your shares of
Interactive Intelligence common stock in "street name" through a broker, bank or other nominee, you must provide a valid and properly executed legal proxy in your favor from your broker, bank or other
nominee in order to be able to vote in person at the special meeting.
It
is not necessary to attend the special meeting in order to vote your shares. To ensure that your shares of Interactive Intelligence common stock are voted at the special meeting, we recommend that
you provide voting instructions promptly by proxy, even if you plan to attend the special meeting in person.
Attending
the meeting in person does not itself constitute a vote on any proposal.
Voting by Proxy Shares of Common Stock Held by Record Holder
If
you do not wish to vote in person or you will not be attending the special meeting, you may vote by proxy using the enclosed proxy card or by voting over the internet or by
telephone:
-
-
To vote over the internet
, go to the web address
www.proxyvote.com
and follow the instructions for voting. Have your proxy
card available when you access the web page. If you vote over the internet,
please do not mail your proxy card.
-
-
To vote by telephone
, dial (800) 690-6903 (this call is toll-free in the United
States) and follow the instructions. Have your proxy card available when you call. If you vote by telephone, please do not mail your proxy card.
-
-
To vote by mail
, mark your proxy card, date and sign it and return it in the
postage-prepaid envelope.
If
you vote by proxy (regardless of whether you vote over the internet, by telephone or by mail), your votes must be received by 11:59 p.m. Eastern Time on November 8, 2016 to be
counted.
Your
proxy card will count as a "vote" if you sign, date and return your proxy card without indicating how you wish to vote with respect to a proposal. In this case, your proxy will be voted
"
FOR
" such proposal.
A
failure to vote or an abstention will have the same effect as voting "
AGAINST
" the proposal to approve the merger agreement. An abstention and,
assuming a quorum is present, a failure to vote will not have the effect of either a vote "
FOR
" or a vote
"
AGAINST
" on the other two proposals.
Voting by Proxy Shares of Common Stock Held in "Street Name"
If
you hold your shares in "street name" through a broker, bank or other nominee, you should follow the directions provided by your broker, bank or other nominee regarding how to instruct your broker,
bank or other nominee to vote your shares. Without those instructions, your shares will not be voted on any of the proposals, which will have the same effect as voting
"
AGAINST
"
19
Table of Contents
the
proposal to approve the merger agreement, but, assuming a quorum is present, will not have the effect of either a vote "
FOR
" or a vote
"
AGAINST
" on the other two proposals.
Voting by Proxy Shares of Common Stock Held through Interactive Intelligence's 401(k) Plan
If you participate in Interactive Intelligence's 401(k) Plan, you may give voting instructions to Bank of America Merrill Lynch Retirement Group, the plan Trustee, as to the number of shares of
Interactive Intelligence common stock credited to your 401(k) Plan account as of the most recent valuation date coincident with or preceding the record date. The Trustee will vote your shares in
accordance with your instructions received by November 7, 2016 at 11:59 p.m. Eastern Time. Your voting instructions will be kept confidential by the Trustee. If you do not send voting
instructions, the Trustee will vote the number of shares credited to your account as directed by the Investment Committee of the 401(k) Plan or by its designee.
Q: Can I revoke my proxy?
-
A:
-
Yes.
Any person giving a proxy pursuant to this solicitation has the power to revoke and change it at any time before it is voted. If you are a shareholder
of record, you may revoke your proxy by:
-
-
submitting a new proxy card with a later date, which is received by Interactive Intelligence prior to the final vote at the special
meeting;
-
-
using the telephone or internet proxy submission procedures described above before the deadlines for voting by telephone or internet;
-
-
attending the special meeting and voting in person; or
-
-
delivering a written notice of revocation by mail to Interactive Intelligence in care of the Secretary at 7601 Interactive Way,
Indianapolis, Indiana 46278, Attn: Secretary, which is received by Interactive Intelligence prior to the final vote at the special meeting.
If
you hold your shares in "street name" and you have instructed a broker, bank or other nominee to vote your shares, you should instead follow the instructions received from your broker, bank or
other nominee to revoke your prior voting instructions. If you hold your shares in "street name," you may also revoke a prior proxy by voting in person at the special meeting if you obtain a valid and
properly executed legal proxy in your favor from your broker, bank or other nominee in order to be able to vote in person at the special meeting. If you hold your shares through Interactive
Intelligence's 401(k) Plan, you may revoke previously given voting instructions by November 7, 2016 at 11:59 p.m. Eastern Time, by delivering new voting instructions over the internet,
by telephone or by mail.
-
Q:
-
Will my shares of Interactive Intelligence common stock held in "street name" or another form of record ownership be combined for
voting purposes with shares I hold of record?
-
A:
-
No.
Because any shares of Interactive Intelligence common stock you may hold in "street name" will be deemed to be held by a different shareholder (that is,
your custodial bank, broker or other nominee) than any shares of Interactive Intelligence common stock you hold of record, any shares of Interactive Intelligence common stock held in "street name"
will not be combined for voting purposes with shares of Interactive Intelligence common stock you hold of record. Similarly, if you own shares of Interactive Intelligence common stock in various
registered forms, such as jointly with your spouse, as trustee of a trust or as custodian for a minor, you will receive, and will need to sign and return, a separate proxy card for those shares of
Interactive Intelligence common stock because they are held in a different form of record ownership. Shares of Interactive Intelligence common stock held by a corporation or business entity must be
voted by an authorized officer of the entity. Please indicate title or authority when completing and signing the proxy card. Shares of
20
Table of Contents
Interactive
Intelligence common stock held in an individual retirement account must be voted under the rules governing the account. This means that, to ensure all your shares are voted at the special
meeting, you should read carefully any proxy materials received and follow the instructions included therewith.
Q: What does it mean if I get more than one proxy card or voting instruction card?
-
A:
-
If
your shares of Interactive Intelligence common stock are registered differently or are held in more than one account, you will receive more than one proxy
or voting instruction card. Please complete and return all of the proxy cards and voting instruction cards you receive (or submit each of your proxies by telephone or over the internet, if available
to you) to ensure that all of your shares of Interactive Intelligence common stock are voted.
Q: What happens if I sell my shares of Interactive Intelligence common stock before completion of the merger?
-
A:
-
In
order to receive the merger consideration, you must hold your shares of Interactive Intelligence common stock through completion of the merger.
Consequently, if you transfer your shares of Interactive Intelligence common stock before completion of the merger, you will have transferred your right to receive the merger consideration in the
merger.
The
record date for shareholders entitled to vote at the special meeting is earlier than the consummation of the merger. If you transfer your shares of Interactive Intelligence common stock after the
record date but before the closing of the merger, you will have the right to vote at the special meeting but not the right to receive the merger consideration.
Q: Should I send in my stock certificates or other evidence of ownership now?
-
A:
-
No.
After the merger is completed, you will receive a letter of transmittal and related materials from the paying agent for the merger with detailed written
instructions for exchanging your shares of Interactive Intelligence common stock evidenced by stock certificates for the merger consideration. If your shares of Interactive Intelligence common stock
are held in "street name" by your broker, bank or other nominee, you may receive instructions from your broker, bank or other nominee as to what action, if any, you need to take to effect the
surrender of your "street name" shares in exchange for the merger consideration.
Do not send in your certificates now.
Q: What is householding and how does it affect me?
-
A:
-
The
SEC permits companies to send a single set of proxy materials to any household at which two or more shareholders reside, unless contrary instructions
have been received, but only if the company provides advance notice and follows certain procedures. In such cases, each shareholder continues to receive a separate notice of the meeting and proxy
card. Certain brokerage firms may have instituted householding for beneficial owners of Interactive Intelligence common stock held through brokerage firms. Please contact your broker directly if you
have any questions or require additional copies of this proxy statement. You may decide at any time to revoke your decision to household, and thereby receive multiple copies. For further information,
see "
The Special MeetingHouseholding of Special Meeting Materials
."
Q: Who will count the votes?
-
A:
-
The
votes will be counted by the independent inspector of election appointed for the special meeting.
21
Table of Contents
Q: Where can I find the voting results of the special meeting?
-
A:
-
We
intend to announce preliminary voting results at the special meeting and publish final results in a Current Report on Form 8-K that will be filed
with the SEC following the special meeting. All reports that we file with the SEC are publicly available when filed. See "
Where You Can Find Additional
Information
" beginning on page 106.
Q: Where can I find more information about Interactive Intelligence?
-
A:
-
You
can find more information about us from various sources described in "
Where You Can Find Additional
Information
."
Q: Who can help answer my other questions?
-
A:
-
If
you have more questions about the merger, or require assistance in submitting your proxy or voting your shares or need additional copies of this proxy
statement or the enclosed proxy card, please contact MacKenzie Partners, Inc., at (800) 322-2885, which is acting as the proxy solicitation agent and information agent for Interactive
Intelligence in connection with the merger.
MacKenzie Partners, Inc.
105 Madison Avenue
New York, NY 10016
Email: proxy@mackenziepartners.com
Call collect: (212) 929-5500
Call toll-free: (800) 322-2885
or
Interactive Intelligence Group, Inc.
Attn: Investors Relations
7601 Interactive Way
Indianapolis, Indiana 46278
(317) 872-3000
If
your broker, bank or other nominee holds your shares, you should also call your broker, bank or other nominee for additional information.
22
Table of Contents
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
Statements made in this proxy statement relating to future plans, events, or financial condition or performance are "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can generally be identified by the use of words such as "anticipate,"
"believe," "continue," "could," "estimate," "evolve," "expect," "forecast," "intend," "looking ahead," "may," "opinion," "plan," "possible," "potential," "project," "should," "will" and similar words
or expression. Forward-looking statements are likely to address matters such as, among other things, Interactive Intelligence's, Genesys' and their respective affiliates' respective or combined
anticipated sales, expenses, margins, tax rates, capital expenditures, profits, cash flows, liquidity and debt levels. These forward-looking statements are based on the companies' current plans,
expectations and assumptions and involve a number of risks and uncertainties that could cause actual results and events to vary materially from the results and events anticipated or implied by such
forward-looking statements.
These
risks and uncertainties include, but are not limited to, the risks detailed in Interactive Intelligence's filings with the SEC, including in its most recent filings on
Forms 10-K and 10-Q (see "
Where You Can Find Additional Information
"), factors and matters described or incorporated by reference in this proxy
statement, and the following factors:
-
-
The inability to consummate the merger within the anticipated time period, or at all, due to the failure to obtain shareholder
approval to approve the merger agreement or failure to satisfy the other conditions to the completion of the merger;
-
-
The risk that the merger agreement may be terminated in circumstances requiring Interactive Intelligence to pay Genesys a termination
fee of up to $43 million;
-
-
The failure by Genesys and its affiliates to obtain the debt financing contemplated in the debt commitment letter entered into in
connection with the merger agreement, or alternative financing, as applicable, or the failure of any such financing to be sufficient to consummate the merger and the other transactions contemplated by
the merger agreement, which, in certain instances, could result in Interactive Intelligence's only viable recourse being to pursue payment of the reverse termination fee by Genesys;
-
-
Risks that the proposed merger disrupts Interactive Intelligence's current plans and operations or affects its ability to retain or
recruit key employees;
-
-
The effect of the announcement or pendency of the merger on Interactive Intelligence's business relationships (including, without
limitation, customers and suppliers), operating results and business generally;
-
-
The amount of the costs, fees, expenses and charges related to the merger agreement or the merger;
-
-
Risks related to diverting management's or employees' attention from ongoing business operations;
-
-
Limitations places on Interactive Intelligence's ability to operate its business under the merger agreement;
-
-
The occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement;
-
-
Risk that Interactive Intelligence's stock price may decline significantly if the merger is not completed or may suffer as a result of
uncertainty surrounding the merger;
-
-
The risk that the merger may not be consummated in a timely manner, if at all;
23
Table of Contents
-
-
The risk of not fully realizing expected benefits and synergies in the timeframe expected or at all;
-
-
The nature, cost and outcome of pending and future litigation and other legal proceedings, including any such proceedings related to
the merger and instituted against Interactive Intelligence and others;
-
-
The fact that receipt of the all-cash merger consideration would be taxable to Interactive Intelligence's shareholders that are
treated as U.S. holders for U.S. federal income tax purposes;
-
-
The fact that Interactive Intelligence's shareholders would forgo the opportunity to realize the potential long-term value of the
successful execution of Interactive Intelligence's current strategy as an independent public company;
-
-
The possibility that the companies may be adversely affected by other economic, business and/or competitive factors;
-
-
Worldwide economic conditions and their impact on customer purchasing decisions; and
-
-
Rapid technological changes and competitive pressures in the industry.
Many
of the factors that will determine the companies' future results are beyond their ability to control or predict. In light of the significant uncertainties inherent in the
forward-looking statements contained herein, readers should not place undue reliance on forward-looking statements, which speak only as of the date hereof. Except as required by applicable law,
Interactive Intelligence and Genesys undertake no obligation to update forward-looking statements to reflect events or circumstances arising after such
date. The companies cannot guarantee any future results, levels of activity, performance or achievements.
24
Table of Contents
THE COMPANIES
Interactive Intelligence Group, Inc.
Interactive Intelligence Group, Inc. is an Indiana corporation. We are a global provider of software and cloud services for
customer engagement, communication and collaboration. We are the only vendor to be recognized by leading industry analyst firm Gartner, Inc. as a market leader in both its Magic Quadrant for
Contact Center Infrastructure, Worldwide (for our on-premises offering) and its Magic Quadrant for Contact Center as a Service, North America (for our cloud offerings). We offer three types of
products: on-premises software known as Interactive Intelligence Customer Interaction Center®; a single-tenant cloud service known as Interactive Intelligence Communications as a
Service
SM
; and a multi-tenant cloud service known as Interactive Intelligence PureCloud® ("PureCloud"). Our offerings are used across a wide variety of vertical industries,
including accounts receivable management, banking, government, healthcare, insurance, manufacturing, outsourcing, utilities and retail, among others. We continue to invest in the development of both
our on-premises and cloud offerings, with particular emphasis on our latest cloud services delivered by our PureCloud Platform. This cloud platform is designed as a set of components that work
independently of each other to deliver coordinated services (a "microservices architecture"). The PureCloud Platform leverages Amazon Web Services and has a comprehensive set of features capable of
delivering cloud services for organizations of all types and sizes. The first PureCloud services were released in North America in March 2015. Subsequent releases have been made available in
Australia, New Zealand, Japan and throughout Europe.
We
were founded in 1994 and released our first product in 1997. More than 6,000 customers worldwide have deployed our products. We sell our products directly to customers and through a
channel of
approximately 400 partners globally. Our on-premises and single-tenant cloud products are available in 24 languages and deployed in approximately 125 countries.
Interactive Intelligence common stock is traded on Nasdaq under the symbol "ININ." We maintain our world headquarters and principal executive offices at 7601 Interactive Way,
Indianapolis, Indiana 46278. Our telephone number is (317) 872-3000. We are located on the web at
www.inin.com
. A detailed description of
Interactive Intelligence's business is contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2015, which is incorporated by reference into this proxy
statement. See "
Where You Can Find Additional Information
."
Genesys Telecommunications Laboratories, Inc.
Genesys Telecommunications Laboratories, Inc., referred to as "Genesys," empowers companies to create effortless omnichannel
customer experiences, journeys, and relationships. For over 25 years, Genesys has put the customer at the center of all it does and passionately believes that great customer engagement drives
great business outcomes. Genesys is trusted by over 4,700 customers in 120 countries to orchestrate over 25 billion contact center interactions per year in the cloud and on premises.
Genesys' principal executive offices are located at 2001 Junipero Serra Boulevard, 9
th
Floor, Daly City, California 94014, and its telephone number is (888) GENESYS
(436-3797).
Giant Merger Sub Inc.
Giant Merger Sub Inc., referred to as "Merger Sub," is an Indiana corporation and a wholly owned subsidiary of Genesys that was
formed solely for the purpose of entering into the merger agreement and consummating the transactions contemplated by the merger agreement.
Merger
Sub's principal executive offices are located at 2001 Junipero Serra Boulevard, 9
th
Floor, Daly City, California 94014, and its telephone number is
(888) GENESYS (436-3797).
25
Table of Contents
THE SPECIAL MEETING
We are furnishing this proxy statement to Interactive Intelligence shareholders as part of the solicitation of
proxies by the Interactive Intelligence board of directors for use at the special meeting or any adjournment or postponement thereof. This proxy statement provides Interactive Intelligence
shareholders with the information they need to know to be able to vote or instruct their vote to be cast at the special meeting or any adjournment or postponement thereof.
Date, Time and Place of the Special Meeting
This proxy statement is being furnished to our shareholders as part of the solicitation of proxies by the Interactive Intelligence
board of directors for use at the special meeting to be held at Interactive Intelligence's world headquarters located at 7601 Interactive Way, Indianapolis, Indiana 46278, on November 9, 2016
at 9:00 a.m. local time, or at any adjournment or postponement thereof.
To
attend the meeting, you will need to present valid photo identification, such as a driver's license or passport, and proof of ownership of Interactive Intelligence common stock. If
your shares are held in the name of a broker, bank or other nominee, you will need to present a recent brokerage statement or letter from such entity reflecting your stock ownership as of the record
date.
If
you are not a holder of record or beneficial owner as of the record date, you may be admitted to the meeting only if you have a valid and properly executed legal proxy from a holder
of record as of the record date. You must present that legal proxy, as well as a form of valid photo identification, at the entrance to the meeting.
Purposes of the Special Meeting
At the special meeting, Interactive Intelligence shareholders will be asked to consider and vote on the following
proposals:
-
-
to approve the merger agreement;
-
-
to approve, on an advisory (non-binding) basis, certain compensation that may be paid or become payable to Interactive Intelligence's
named executive officers in connection with the merger, the value of which is disclosed in the table set forth in "
The Merger (Proposal 1)Interests of Interactive
Intelligence's Directors and Executive Officers in the MergerQuantification of Payments and Benefits to Interactive Intelligence's Executive Officers
"; and
-
-
to approve the adjournment of the special meeting, if necessary or appropriate, including to solicit additional proxies if there are
insufficient votes at the time of the special meeting to approve the proposal to approve the merger agreement or in the absence of a quorum.
Our
shareholders must approve the merger agreement for the merger to occur. If our shareholders fail to approve the merger agreement, the merger will not occur. A copy of the merger
agreement is attached to this proxy statement as
Annex A
, and the material provisions of the merger agreement are described in
"
The Merger Agreement
."
The
vote on the compensation that may be paid or become payable to Interactive Intelligence's named executive officers in connection with the merger is a vote separate and apart from the
vote to approve the merger agreement. Accordingly, a shareholder may vote to approve the compensation that may be paid or become payable to Interactive Intelligence's named executive officers in
connection with the merger and vote not to approve the merger agreement and vice versa. Because the vote on the
compensation that may be paid or become payable to Interactive Intelligence's named executive officers in connection with the merger is advisory only, it will not be binding on either Interactive
Intelligence or Genesys. Accordingly, if the merger agreement is approved by Interactive Intelligence shareholders and the merger is completed, the merger-related compensation will be paid to
Interactive Intelligence's
26
Table of Contents
named
executive officers in accordance with the terms of their compensation agreements or arrangements even if shareholders do not approve that proposal.
Interactive
Intelligence does not expect a vote to be taken on any other matters at the special meeting or any adjournment or postponement thereof. If any other matters are properly
presented at the special meeting or any adjournment or postponement thereof for consideration, however, the holders of the proxies will have discretion to vote on these matters in accordance with
their best judgment.
This proxy statement and the enclosed form of proxy are first being mailed to Interactive Intelligence shareholders on or about October 5, 2016.
Record Date and Quorum
The holders of record of Interactive Intelligence common stock as of the close of business on September 30, 2016, the record
date for the special meeting, are entitled to receive notice of and to vote at the special meeting. At the close of business on the record date, 22,326,212 shares of Interactive Intelligence common
stock were outstanding.
The
presence at the special meeting, in person or represented by proxy, of the holders of record of a majority of Interactive Intelligence common stock outstanding at the close of
business on the record date and entitled to vote will constitute a quorum. Once a share is represented at the special meeting, it will be counted for the purpose of determining a quorum at the special
meeting. However, if a new record date is set for an adjourned special meeting, then a new quorum will have to be established. Proxies received but marked as abstentions will be included in the
calculation of the number of shares considered to be present at the special meeting.
Required Vote
Each share of Interactive Intelligence common stock outstanding at the close of business on the record date is entitled to one vote on
each of the proposals to be considered at the special meeting.
For
Interactive Intelligence to complete the merger, Interactive Intelligence shareholders holding a majority of the shares of Interactive Intelligence common stock outstanding at the
close of business on the record date and entitled to vote on such proposal must vote "
FOR
" the proposal to approve the merger agreement. A failure to
vote your shares of Interactive Intelligence common stock or an abstention from voting will have the same effect as a vote "
AGAINST
" the proposal to
approve the merger agreement. If your shares are held in "street name" by your broker, bank or other nominee and you do not instruct the nominee how to vote your shares, such failure to instruct your
nominee will have the same effect as a vote "
AGAINST
" the proposal to approve the merger agreement.
Approval
of each of the advisory (non-binding) proposal on certain compensation that may be paid or become payable to Interactive Intelligence's named executive officers in connection
with the merger and the proposal to adjourn the special meeting, if necessary or appropriate, including to solicit additional proxies or in the absence of a quorum, requires that more shares are voted
"
FOR
" such proposal than "
AGAINST
." An abstention with respect to either proposal and a failure to vote
your shares of Interactive Intelligence common stock (including a failure of your broker, bank or other nominee to vote shares held on your behalf), assuming a quorum is present, will not have the
effect of either a vote "
FOR
" or a vote "
AGAINST
" on these proposals.
As of the close of business on the record date, there were 22,326,212 shares of Interactive Intelligence common stock outstanding and 83 record holders.
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Table of Contents
Voting by Interactive Intelligence's Directors and Executive Officers
At the close of business on the record date, directors and executive officers of Interactive Intelligence were entitled to vote
approximately 4,364,549 shares of Interactive Intelligence common stock, which in the aggregate represents approximately 19.5% of the shares of Interactive Intelligence common stock issued and
outstanding on that date. We currently expect that Interactive Intelligence's directors and executive officers will vote their shares in favor of the proposal to approve the merger agreement and the
other proposals to be considered at the special meeting, although, other than Dr. Brown pursuant to the voting agreement described below, they have no obligation to do so.
Concurrently with the execution and delivery of the merger agreement, Genesys entered into a Voting Agreement, dated as of August 30, 2016 (the "voting agreement"), with
Dr. Brown pursuant to which Dr. Brown agreed, among other things, to vote his shares of Interactive Intelligence common stock, or approximately 17.1% of the shares of Interactive
Intelligence common stock issued and outstanding on the record date, in favor of the merger agreement and the merger and against any other proposal or offer to acquire Interactive Intelligence. A
total of 11,163,107 votes are needed to approve the merger agreement. Therefore, approximately 7,335,659 other votes, representing approximately 39.7% of the 18,498,763 other votes entitled to be cast
by shareholders that are not a party to the voting agreement, must be cast in favor of the proposal to approve the merger agreement in order to approve the merger agreement.
Voting; Proxies; Revocation
Attendance
All holders of shares of Interactive Intelligence common stock as of the close of business on September 30, 2016, the record
date, including shareholders of record and beneficial owners of Interactive Intelligence common stock registered in the "street name" of a broker, bank or other nominee, are invited to attend the
special meeting. If you are a shareholder of record,
please be prepared to provide valid photo identification, such as a driver's license or passport, and proof of ownership of Interactive Intelligence common stock. If your shares are held in the name
of a broker, bank or other nominee, you will need to present a recent brokerage statement or letter from such entity reflecting your stock ownership as of the record date. If you do not provide photo
identification or comply with the other procedures outlined in this proxy statement, you will not be admitted to the special meeting. For security reasons, you and your bags may be subject to search
prior to your admittance to the meeting.
If
you are not a holder of record or beneficial owner as of the record date, you may be admitted to the meeting only if you have a valid and properly executed legal proxy from a holder
of record as of the record date. You must present that legal proxy, as well as a form of valid photo identification, at the entrance to the meeting.
Voting in Person
Shareholders of record will be able to vote in person at the special meeting. We will give you a ballot when you arrive. If you are not
a shareholder of record but instead hold your shares of Interactive Intelligence common stock in "street name" through a broker, bank or other nominee, you must provide a valid and properly executed
legal proxy in your favor from your broker, bank or other nominee in order to be able to vote in person at the special meeting. Attending the meeting in person does not itself constitute a vote on any
proposal.
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Providing Voting Instructions by Proxy
To ensure that your shares of Interactive Intelligence common stock are voted at the special meeting, we recommend that you provide
voting instructions promptly by proxy, even if you plan to attend the special meeting in person.
If you are a shareholder of record, you may provide voting instructions by proxy using one of the methods described below.
To vote over the internet
, go to the web address
www.proxyvote.com
and follow the
instructions for voting. Have your proxy card available when you access the web page. If you vote over the internet, please do not mail your proxy card.
To vote by telephone
, dial (800) 690-6903 (this call is toll-free in the United States) from any touch-tone telephone and follow
the instructions. Have your proxy card available when you call. If you vote by telephone, please do not mail your proxy card.
To vote by mail
, mark your proxy card, date and sign it and return it in the postage-prepaid envelope.
If you vote by proxy (regardless of whether you vote over the internet, by telephone or by mail), your votes must be received by 11:59 p.m. Eastern Time on November 8, 2016
to be counted.
Your
proxy card will count as a "vote" if you sign, date and return your proxy card without indicating how you wish to vote with respect to a proposal. In this case, your proxy will be
voted "
FOR
" such proposal.
A
failure to vote or an abstention will have the same effect as voting "
AGAINST
" the proposal to approve the merger agreement. An
abstention and, assuming a quorum is present, a failure to vote will not have the effect of either a vote "
FOR
" or a vote
"
AGAINST
" on the other two proposals.
If you hold your shares in "street name" through a broker, bank or other nominee, you should follow the directions provided by your
broker, bank or other nominee regarding
how to instruct your broker, bank or other nominee to vote your shares. Without those instructions, your shares will not be voted on any of the proposals, which will have the same effect as voting
"
AGAINST
" the proposal to approve the merger agreement, but, assuming a quorum is present, will not have the effect of either a vote
"
FOR
" or a vote "
AGAINST
" on the other two proposals.
In
accordance with the rules of Nasdaq, brokers, banks and other nominees that hold shares of Interactive Intelligence common stock in "street name" for their customers do not have
discretionary authority to vote the shares with respect to the proposal to approve the merger agreement, the advisory (non-binding) proposal to approve certain compensation that may be paid or become
payable to Interactive Intelligence's named executive officers in connection with the merger, or the adjournment of the special meeting, if necessary or appropriate, including to solicit additional
proxies or in the absence of a quorum. Accordingly, if brokers, banks or other nominees do not receive specific voting instructions from the beneficial owner of such shares, they may not vote such
shares with respect to these proposals. Therefore, unless you attend the special meeting in person with a valid and properly executed legal proxy from your broker, bank or other nominee, your failure
to provide instructions to your broker, bank or other nominee will result in your shares of Interactive Intelligence common stock not being present at the meeting and not being voted on any of the
proposals.
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If you participate in the 401(k) Plan, you may give voting instructions to Bank of America Merrill Lynch Retirement Group, the plan
Trustee, as to the number of shares of Interactive Intelligence common stock credited to your 401(k) Plan account as of the most recent valuation date coincident with or preceding the record date. The
Trustee will vote your shares in accordance with your instructions received by November 7, 2016 at 11:59 p.m. Eastern Time. Your voting instructions will be kept confidential by the
Trustee. If you do not send voting instructions, the Trustee will vote the number of shares credited to your account as directed by the Investment Committee of the 401(k) Plan or by its designee.
Revocation of Proxies
Any person giving a proxy pursuant to this solicitation has the power to revoke and change it at any time before it is voted. If you
are a shareholder of record, you may revoke your proxy by:
-
-
submitting a new proxy card with a later date, which is received by Interactive Intelligence prior to the final vote at the special
meeting;
-
-
using the telephone or internet proxy submission procedures described above before the deadlines for voting by telephone or over the
internet;
-
-
attending the special meeting and voting in person; or
-
-
delivering a written notice of revocation by mail to Interactive Intelligence in care of the Secretary at 7601 Interactive Way,
Indianapolis, Indiana 46278, Attn: Secretary, which is received by Interactive Intelligence prior to the final vote at the special meeting.
Please
note that only your last-dated proxy will count. Attending the special meeting without taking one of the actions described above will not in itself revoke your proxy. If you want
to revoke your proxy by mailing a new proxy card to Interactive Intelligence or by sending a written notice of revocation to Interactive Intelligence, you should ensure that you send your new proxy
card or written notice of revocation in sufficient time for it to be received by Interactive Intelligence before the special meeting.
If you hold your shares in "street name" and you have instructed a broker, bank or other nominee to vote your shares, you should instead follow the instructions received from your
broker, bank or other nominee to revoke your prior voting instructions. If you hold your shares in "street name," you may also revoke a prior proxy by voting in person at the special meeting if you
obtain a valid and properly executed legal proxy in your favor from your broker, bank or other nominee in order to be able to vote in person at the special meeting. If you hold your shares through
Interactive Intelligence's 401(k) Plan, you may revoke previously given voting instructions by November 7, 2016 at 11:59 p.m. Eastern Time, by delivering new voting instructions over the
internet, by telephone or by mail.
Abstentions
An abstention occurs when a shareholder attends a meeting, either in person or represented by proxy, but abstains from voting.
Abstentions will be included in the calculation of the number of shares of Interactive Intelligence common stock present or represented at the special meeting for purposes of determining whether a
quorum has been achieved.
Abstaining
from voting will have the same effect as a vote "
AGAINST
" the proposal to approve the merger agreement. The requisite number of
shares to approve the other two proposals is based on the total number of shares voted "
FOR
" such proposal compared to the number of shares voted
"
AGAINST
" such proposal. If you abstain from voting with respect to such proposals, such abstention will not have the effect of either a vote
"
FOR
" or a vote "
AGAINST
" such proposals.
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Board of Directors' Recommendation
After consideration of, and based upon, the unanimous recommendation of the Independent Committee of the board of directors and after
considering various factors described in "
The Merger (Proposal 1)Reasons for the Board of Directors' Recommendation to Vote in Favor of the
Merger
," the Interactive Intelligence board of directors unanimously determined that the merger agreement and the transactions contemplated by the merger agreement, including
the merger, are fair to, advisable and in the best interests of Interactive Intelligence and its shareholders and
approved the merger agreement and the transactions contemplated by the merger agreement, including the merger.
The
Interactive Intelligence board of directors unanimously recommends that you vote (1) "
FOR
" the proposal to approve the merger
agreement, (2) "
FOR
" the advisory (non-binding) proposal to approve certain compensation that may be paid or become payable to Interactive
Intelligence's named executive officers in connection with the merger and (3) "
FOR
" the proposal to adjourn the special meeting, if necessary or
appropriate, including to solicit additional proxies or in the absence of a quorum.
Solicitation of Proxies
The Interactive Intelligence board of directors is soliciting your proxy, and Interactive Intelligence will bear the cost of this
solicitation of proxies. This includes the charges and expenses of brokerage firms and others for forwarding solicitation material to beneficial owners of outstanding Interactive Intelligence common
stock. Interactive Intelligence has retained MacKenzie Partners, Inc. ("MacKenzie"), a proxy solicitation firm, to assist the Interactive Intelligence board of directors in the solicitation of
proxies for the special meeting, and expects to pay MacKenzie $12,500, plus reimbursement of out-of-pocket expenses. Proxies may be solicited by mail, personal interview, email, telephone, or over the
internet by MacKenzie or, without additional compensation, by certain of Interactive Intelligence's directors, officers and employees.
Other Business
We are not currently aware of any business to be acted upon at the special meeting other than the matters discussed in this proxy
statement. Under our bylaws, business transacted at the special meeting is limited to matters relating to the purposes stated in the notice of the special meeting, which is provided at the beginning
of this proxy statement. The grant of a proxy will confer discretionary authority on the persons named as proxies on the proxy card to vote in accordance with their best judgment on procedural matters
incident to the conduct of the special meeting.
Important Notice Regarding the Availability of Proxy Materials for the Special Meeting to be Held on November 9, 2016
This proxy statement is available at
www.proxyvote.com
.
Householding of Special Meeting Materials
We may send a single copy of this proxy statement to any household at which two or more shareholders reside in accordance with SEC
rules, unless we have received contrary instructions. Each shareholder in the household will continue to receive a separate proxy card. This process, known as "householding," reduces the volume of
duplicate information received at your household and helps to reduce our expenses.
If,
at any time, you no longer wish to participate in "householding" and would prefer to receive a separate proxy statement, please notify your broker or direct your written request to:
Investor Relations, Interactive Intelligence Group, Inc., 7601 Interactive Way, Indianapolis, Indiana 46278, or
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contact
our Investor Relations department at (317) 872-3000. We will promptly deliver upon written or oral request a separate copy of the proxy statement to a shareholder at a shared address to
which a single copy of the proxy statement was delivered. Shareholders who currently receive multiple copies of the proxy statement at their addresses and would like to request "householding" of their
communications should contact their broker.
THIS PROXY STATEMENT DOES NOT CONSTITUTE THE SOLICITATION OF A PROXY IN ANY JURISDICTION TO OR FROM ANY PERSON TO WHOM OR FROM WHOM IT IS UNLAWFUL TO MAKE SUCH
PROXY SOLICITATION IN THAT JURISDICTION. YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY REFERENCE INTO THIS PROXY STATEMENT TO VOTE YOUR SHARES AT THE SPECIAL MEETING. NO PERSONS
HAVE BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROXY STATEMENT, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY US OR ANY OTHER PERSON. THIS PROXY STATEMENT IS DATED OCTOBER 3, 2016. YOU SHOULD NOT ASSUME THAT THE INFORMATION CONTAINED IN THIS PROXY STATEMENT IS
ACCURATE AS OF ANY DATE OTHER THAN THAT DATE, AND THE MAILING OF THIS PROXY STATEMENT TO SHAREHOLDERS DOES NOT AND WILL NOT CREATE ANY IMPLICATION TO THE CONTRARY.
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Annex A
EXECUTION VERSION
AGREEMENT AND PLAN OF MERGER
by and among
GENESYS TELECOMMUNICATIONS LABORATORIES, INC.,
GIANT MERGER SUB INC.,
INTERACTIVE INTELLIGENCE
GROUP, INC.,
and, solely for the purpose of Section 5.16 hereof,
GREENEDEN LUX 3 S.ÀR.L.,
GREENEDEN U.S. HOLDINGS I, LLC
and
GREENEDEN U.S. HOLDINGS II, LLC
Dated as of August 30, 2016
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AGREEMENT AND PLAN OF MERGER, dated as of August 30, 2016 (this "
Agreement
"), among Genesys
Telecommunications Laboratories, Inc., a California corporation ("
Parent
"), Giant Merger Sub Inc., an Indiana corporation and a direct,
wholly owned subsidiary of Parent ("
Merger Sub
"), Interactive Intelligence Group, Inc., an Indiana corporation (the
"
Company
"), and, solely for the purposes of Section 5.16, Greeneden Lux 3 S.àR.L., a societe a responsabilite limitee under the
laws of Luxembourg ("
Luxco 3
"), Greeneden U.S. Holdings I, LLC, a Delaware limited liability company ("
LLC
1
"), and Greeneden U.S. Holdings II, LLC, a Delaware limited liability company ("
LLC 2
", together with Parent, Luxco 3
and LLC 1, the "
Parent Parties
").
RECITALS
WHEREAS, Parent desires to acquire the Company on the terms and subject to the conditions set forth in this Agreement;
WHEREAS,
in furtherance of such acquisition of the Company by Parent, and on the terms and subject to the conditions set forth in this Agreement and in accordance with the Indiana
Business Corporation Law, as amended (the "
IBCL
"), Merger Sub shall be merged with and into the Company (the
"
Merger
"), with the Company surviving the Merger as a wholly owned subsidiary of Parent;
WHEREAS,
the Board of Directors of the Company has unanimously (a) determined that it is fair to and in the best interests of the Company and its shareholders, and declared it
advisable, to enter into this Agreement and to consummate the transactions contemplated hereby, including the Merger, (b) approved the execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated hereby, including the Merger, and (c) resolved to recommend adoption of this Agreement by the shareholders of the Company;
WHEREAS,
the Boards of Directors of Parent and Merger Sub have approved the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated
hereby, including the Merger, and declared it advisable for Parent and Merger Sub, respectively, to enter into this Agreement;
WHEREAS,
Parent, as the sole shareholder of Merger Sub, has adopted this Agreement;
WHEREAS,
concurrently with the execution and delivery of this Agreement, Parent and Donald E. Brown, M.D., will enter into a voting and support agreement (the
"
Voting Agreement
"), the form of which is attached as Annex I; and
WHEREAS,
Parent, Merger Sub and the Company desire to make certain representations, warranties, covenants and agreements specified herein in connection with this Agreement.
NOW,
THEREFORE, in consideration of the foregoing and the representations, warranties, covenants and agreements contained herein, and intending to be legally bound hereby, Parent, Merger
Sub and the Company agree as follows:
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ARTICLE 1
THE MERGER
Section 1.1
The Merger
. On the terms and subject to the
conditions set forth in this Agreement, and in accordance with the IBCL, at the Effective Time, Merger Sub shall merge with and into the Company, the separate corporate existence of Merger Sub shall
cease and the Company shall continue its corporate existence under Indiana law as the surviving corporation in the Merger (the "
Surviving Corporation
")
and a direct, wholly owned Subsidiary of Parent.
Section 1.2
Closing
. The closing of the Merger (the
"
Closing
") shall take place (a) at the offices of Faegre Baker Daniels LLP, 600 East 96th Street, Suite 600, Indianapolis,
Indiana 46240, at 10:00 a.m., local time, on the third (3rd) Business Day after the satisfaction or waiver (to the extent permitted by applicable Law) of the conditions set forth in
Article
6
(other than those conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of such
conditions) or (b) at such other place, time and date as the Company and Parent may agree in writing;
provided
that, notwithstanding the
satisfaction or waiver of the conditions set forth in
Article
6, the parties shall not be required to effect the Closing until the earlier of
(i) a date during the Marketing Period specified by Parent on no less than three (3) Business Days' prior written notice to the Company and (ii) the third (3rd) Business Day
following the final day of the Marketing Period (subject, in each case, to the satisfaction or waiver in writing of all of the conditions set forth in
Article
6 as of the date determined pursuant to
this
Section 1.2
). The date on which the Closing
actually occurs is referred to as the "
Closing Date
."
Section 1.3
Effective Time
. Subject to the provisions of
this Agreement, at the Closing and on the Closing Date, the Company shall cause articles of merger (the "
Articles of Merger
") to be executed,
acknowledged and filed with the Secretary of State of the State of Indiana in accordance with IBCL 23-1-40-5. The Merger shall become effective at such time as the Articles of Merger have been
duly filed with the Secretary of State of the State of Indiana or at such later date or time as may be agreed by the Company and Merger Sub and specified in the Articles of Merger in accordance with
IBCL 23-1-40-5 (the effective time of the Merger being hereinafter referred to as the "
Effective Time
").
Section 1.4
Effects of the Merger
. The Merger shall have
the effects set forth in this Agreement and the applicable provisions of the IBCL.
Section 1.5
Organizational Documents of the Surviving
Corporation
. Subject to
Section 5.9
, at the Effective Time: (a) the articles of incorporation of the
Company as in effect immediately prior to the Effective Time shall be the articles of incorporation of the Surviving Corporation until thereafter amended in accordance with the IBCL and such articles
of incorporation; and (b) the bylaws of Merger Sub as in effect immediately prior to the Effective Time (but amended so that the name of the Surviving Corporation shall be "Interactive
Intelligence Group, Inc."), as so amended, shall be the bylaws of the Surviving Corporation until thereafter amended in accordance with the IBCL and such bylaws.
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Section 1.6
Directors of the Surviving
Corporation
. Subject to applicable Law, the directors of Merger Sub as of immediately prior to the Effective Time shall be the initial directors of the Surviving
Corporation and shall hold office until their respective successors are duly elected and qualified, or their earlier death, incapacitation, retirement, resignation or removal.
Section 1.7
Officers of the Surviving Corporation
. The
officers of the Company as of immediately prior to the Effective Time shall be the initial officers of the Surviving Corporation and shall hold office until their respective successors are duly
elected and qualified, or their earlier death, incapacitation, retirement, resignation or removal.
ARTICLE 2
CONVERSION OF SHARES; EXCHANGE OF CERTIFICATES
Section 2.1
Effect on Capital Stock
.
(a) At
the Effective Time, by virtue of the Merger and without any action on the part of the Company, Merger Sub or the holders of any securities of the Company or Merger
Sub:
(i)
Conversion of Common Stock
. Each share of common stock, par value $0.01 per share, of the Company
(collectively, the "
Common Stock
," and each, a "
Share
" and together, the
"
Shares
") that is outstanding as of immediately prior to the Effective Time, other than Cancelled Shares and Converted Shares, shall be converted
automatically into and shall thereafter represent the right to receive $60.50 in cash (the "
Merger Consideration
"). All Shares that have been converted
into the right to receive the Merger Consideration as provided in this
Section 2.1
shall be automatically cancelled and shall cease to exist, and
the holders of Book-Entry Shares or Certificates that immediately prior to the Effective Time represented such Shares shall cease to have any rights with respect to such Shares other than the right to
receive the Merger Consideration and the right to receive any then declared and unpaid dividend or other distribution with respect to such Shares having a record date before the Effective Time (in
each case, less any applicable withholding Taxes) in accordance with this
Article 2
.
(ii)
Company-, Parent- and Merger Sub-Owned Shares.
Each Share of Common Stock that is owned directly by the
Company, Parent or Merger Sub as of immediately prior to the Effective Time (the "
Cancelled Shares
") shall be cancelled and retired and shall cease to
exist, and no consideration shall be delivered in exchange for such cancellation and retirement. Each Share of Common Stock that is owned directly by any Subsidiary of the Company, any Subsidiary of
Parent (other than Merger Sub) or any Subsidiary of Merger Sub (the "
Converted Shares
") as of immediately prior to the Effective Time shall be converted
into such number of shares of common stock of the Surviving Corporation so as to maintain relative ownership percentages. No Merger Consideration shall be paid in respect of Cancelled Shares or
Converted Shares.
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(iii)
Conversion of Merger Sub Common Stock.
Each share of common stock, par value $0.01 per share, of Merger
Sub outstanding as of immediately prior to the Effective Time shall be converted into and become one validly issued, fully paid and nonassessable share of common stock, par value $0.01 per share, of
the Surviving Corporation with the same rights, powers and privileges as the shares so converted and shall constitute the only outstanding shares of capital stock of the Surviving Corporation. From
and after the Effective Time, all certificates representing the common stock of Merger Sub shall be deemed for all purposes to represent the number of shares of common stock of the Surviving
Corporation into which they were converted in accordance with the immediately preceding sentence.
(b)
Certain Adjustments.
If, between the date of this Agreement and the Effective Time, the outstanding Shares
of Common Stock of the Company shall have been changed into a different number of shares or a different class of shares by reason of any stock dividend, subdivision, reorganization, reclassification,
recapitalization, stock split, reverse stock split, combination or exchange of shares, the Merger Consideration shall be equitably adjusted, without duplication, to proportionally reflect such change.
Section 2.2
Exchange of Certificates
.
(a)
Paying Agent.
Prior to the Effective Time, Parent shall deposit, or shall cause to be deposited, with a U.S.
bank or trust company that shall be appointed to act as a paying agent hereunder and reasonably approved in advance by the Company (the "
Paying Agent
"),
in trust for the benefit of holders of the Shares, cash in U.S. dollars sufficient to pay the aggregate Merger Consideration in exchange for all of the Shares outstanding as of immediately prior to
the Effective Time (other than the Cancelled Shares and the Converted Shares), payable upon due surrender of the certificates that immediately prior to the Effective Time represented Shares
("
Certificates
") (or effective affidavits of loss in lieu thereof) or non-certificated Shares represented by book-entry
("
Book-Entry Shares
") pursuant to the provisions of this
Article
2 (such cash being hereinafter referred
to as the "
Exchange Fund
").
(b)
Payment Procedures
.
(i) As
soon as reasonably practicable after the Effective Time and in any event not later than the second Business Day following the Closing Date, Parent shall cause the
Paying Agent to mail to each holder of record of Shares whose Shares were converted into the right to receive the Merger
Consideration pursuant to
Section 2.1
, (A) a letter of transmittal (which shall specify that delivery shall be effected, and risk of loss
and title to Certificates shall pass, only upon delivery of Certificates (or effective affidavits of loss in lieu thereof) or Book-Entry Shares to the Paying Agent and shall be in such form and have
such other provisions as is customary), and (B) instructions for use in effecting the surrender of Certificates (or effective affidavits of loss in lieu thereof) or Book-Entry Shares in
exchange for the Merger Consideration.
(ii) Upon
surrender of Certificates (or effective affidavits of loss in lieu thereof) or Book-Entry Shares to the Paying Agent, together with such letter of transmittal,
duly completed and validly executed in accordance with the instructions thereto, and such other documents as may
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customarily
be required by the Paying Agent, the holder of such Certificates (or effective affidavits of loss in lieu thereof) or Book-Entry Shares shall be entitled to receive in exchange therefor an
amount in cash equal to the product of (x) the number of Shares represented by such holder's properly surrendered Certificates (or effective affidavits of loss in lieu thereof) or Book-Entry
Shares and (y) the Merger Consideration (less any applicable withholding Taxes). No interest shall be paid or accrued on any amount payable upon due surrender of Certificates (or effective
affidavits of loss in lieu thereof) or Book-Entry Shares.
(iii) The
Paying Agent, the Company, Parent and Merger Sub, as applicable, shall be entitled to deduct and withhold from any amounts otherwise payable under this Agreement
such amounts as are required to be withheld or deducted under the Internal Revenue Code of 1986, as amended (the "
Code
"), or under any provision of
state, local or foreign Tax Law with respect to the making of such payment. To the extent that amounts are so deducted or withheld, such deducted or withheld amounts shall be treated for all purposes
of this Agreement as having been paid to the Person in respect of which such deduction or withholding was properly made.
(c)
Closing of Transfer Books.
At the Effective Time, the stock transfer books of the Company shall be closed,
and there shall be no further registration of transfers on the stock transfer books of the Surviving Corporation of the Shares that were outstanding as of immediately prior to the Effective Time.
(d)
Termination of Exchange Fund.
Any portion of the Exchange Fund (including the proceeds of any investments
thereof) that remains undistributed to the former holders of Shares on the first anniversary of the Effective Time shall thereafter be delivered to the Surviving Corporation upon demand, and any
former holders of Shares who have not surrendered their Shares in accordance with this
Article 2
shall
thereafter look only to the Surviving Corporation for payment of their claim for the Merger Consideration, without any interest thereon, upon due surrender of Certificates for their Shares (or
effective affidavits of loss in lieu thereof).
(e)
No Liability.
Anything herein to the contrary notwithstanding, none of the Company, Parent, Merger Sub, the
Surviving Corporation, the Paying Agent or any other Person shall be liable to any former holder of Shares for any amount properly delivered to a public official pursuant to any applicable abandoned
property, escheat or similar Law.
(f)
Investment of Exchange Fund.
The Paying Agent shall invest all cash included in the Exchange Fund as
reasonably directed by Parent;
provided, however
, that any investment of such cash shall be limited to direct short-term obligations of, or short-term
obligations fully guaranteed as to principal and interest by, the U.S. government;
provided, further
, that no such investment or loss thereon shall
affect the amounts payable to holders of Certificates (or effective affidavits of loss in lieu thereof) or Book-Entry Shares pursuant to this
Article 2
, and following any losses from any such
investment, Parent shall promptly provide additional funds to the Paying Agent for the benefit of the holders of Shares
of Common Stock of the Company. Any interest and other income resulting from such investments shall be paid to the Surviving Corporation pursuant to
Section 2.2(d)
.
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(g)
Transferred Shares.
If any portion of the Merger Consideration is to be paid to a Person other than the
Person in whose name the surrendered Certificate or the transferred Book-Entry Share is registered, it shall be a condition to such payment that (i) either such Certificate shall be properly
endorsed or shall otherwise be in proper form for transfer or such Book-Entry Share shall be properly transferred and (ii) the Person requesting such payment shall pay to the Paying Agent any
transfer or other similar Tax required as a result of such payment to a Person other than the registered holder of such Certificate or Book-Entry Share or establish to the satisfaction of the Payment
Agent that such Tax has been paid or is not payable.
(h)
Lost Certificates.
In the case of any Certificate that has been lost, stolen or destroyed, upon the making
of an affidavit of that fact by the Person claiming such Certificate to be lost, stolen or destroyed and, if required by the Paying Agent, the posting by such Person of a bond in customary amount as
indemnity against any claim that may be made against it with respect to such Certificate, the Paying Agent shall issue in exchange for such lost, stolen or destroyed Certificate a check in the amount
of the number of Shares represented by such lost, stolen or destroyed Certificate multiplied by the Merger Consideration (less any applicable withholding Taxes).
Section 2.3
Treatment of Company Equity Awards
.
(a)
Company Options.
(i) Each
Company Option that is outstanding immediately prior to the Effective Time and that is vested as of the date hereof or becomes vested prior to the Effective Time
in accordance with its terms or
Section 2.3
of the Company Disclosure Letter (each, a "
Vested
Option
") shall as of the Effective Time, be converted into the right to receive an amount in cash equal to the product of (x) the excess, if any, of the Merger
Consideration over the exercise price per Share of such Vested Option and (y) the total number of Shares subject to such Vested Option. Parent shall cause the Surviving Corporation to pay to
the holders of Vested Options the cash amounts described in the immediately preceding sentence, less such amounts as are required to be withheld or deducted under the Code or any provision of state,
local or foreign Tax Law with respect to the making of such payment, promptly but in any event within seven days following the Effective Time.
(ii) Each
Company Option that is outstanding immediately prior to the Effective Time and that is unvested immediately prior to the Effective Time (and does not become vested
in accordance with
Section 2.3
of the Company Disclosure Letter) (each, an "
Unvested Option
")
shall as of the Effective Time, automatically convert into an award to receive an amount in cash equal to the product of (x) the excess, if any, of the Merger Consideration over the exercise
price per Share of such Unvested Option and (y) the total number of Shares subject to such Unvested Option. Such converted award shall remain subject to the same vesting terms and conditions
that applied to such award immediately prior to the Effective Time, including continued employment with Parent or the Company through the applicable vesting date, and the applicable cash amounts shall
be paid out, less such amounts as are required to be withheld or deducted under the Code or any provision of state, local or foreign Tax Law with respect to the making of such payment, promptly but in
any event within thirty days of the vesting date.
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(iii) If
the applicable exercise price per Share of any Company Option equals or exceeds the Merger Consideration, such Company Option shall be cancelled without payment of
additional consideration, and all rights with respect to such Company Option shall terminate as of the Effective Time.
(b)
Company RSUs.
(i) Each
Company RSU that is outstanding immediately prior to the Effective Time that becomes vested at the Effective Time in accordance with its terms or
Section 2.3
of the Company Disclosure Letter (each,
a "
Vested RSU
"), shall as of the Effective
Time, automatically convert into the right to receive an amount in cash equal to the product of (x) the total number of Shares subject to such Vested RSU and (y) the Merger
Consideration. Parent shall cause the Surviving Corporation to pay to the holders of Vested RSUs the cash amounts described in the immediately preceding sentence, less such amounts as are required to
be withheld or deducted under the Code or any provision of state, local or foreign Tax Law with respect to the making of such payment, promptly but in any event within seven days following the
Effective Time.
(ii) Each
Company RSU that is outstanding immediately prior to the Effective Time and that is unvested immediately prior to the Effective Time (and does not become vested in
accordance with
Section 2.3
of the Company Disclosure Letter) (each, an "
Unvested RSU
"), shall as
of the Effective Time, automatically convert into an award to receive an amount in cash equal to the product of (x) the total number of Shares subject to such Unvested RSU and (y) the
Merger Consideration. Such converted award shall remain subject to the same vesting terms and conditions that applied to such award immediately prior to the Effective Time, including continued
employment with Parent or the Company through the applicable vesting date, and shall be paid, less such amounts as are required to be withheld or deducted under the Code or any provision of state,
local or foreign Tax Law with respect to the making of such payment, on the same payment schedule as applied to such award immediately prior to the Effective Time.
(c) Notwithstanding
the foregoing, for any award of Company Options or Company RSUs that is subject to performance-based vesting and for which the performance period is
incomplete as of the Effective Time, the performance with respect to such awards will be determined in accordance with
Section 2.3
of the Company
Disclosure Letter.
(d) Prior
to the Effective Time, the Company, through its Board of Directors or an appropriate committee thereof, will adopt such resolutions as may reasonably be required
in its discretion to effectuate the actions contemplated by this
Section 2.3
and to ensure that no holder of a Company Equity Award shall have
any right thereunder to acquire any securities of the Company, Parent, the Surviving Corporation or any of their respective Affiliates or to receive any payment or benefit with respect to any award
previously granted under a Company Stock Plan, except as provided in this
Section 2.3
.
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Section 2.4
Employee Stock Purchase
Plan
. The Company shall take all necessary action to ensure (i) that no new offering periods under the Company Employee Stock Purchase Plan, as amended and
restated (the "
ESPP
") will commence during the period from the date of this Agreement through the Effective Time, (ii) that there will be no
increase in the amount of payroll deductions permitted to be made by the participants under the ESPP during the current offering period, except those made in accordance with payroll deduction
elections that already are in effect as of the date of this Agreement, and (iii) that no individual shall commence participation in the ESPP during the period from the date of this Agreement
through the Effective Time. The accumulated contributions of the participants in the current offering period shall be used to purchase Shares as of no later than ten Business Days prior to the
Effective Time, and the participants' purchase rights under such offerings shall terminate immediately after such purchase. As of no later than the Business Day immediately prior to the Effective
Time, the Company shall terminate the ESPP.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except (i) as disclosed in the Company SEC Documents filed prior to the date hereof (other than (x) matters required to
be disclosed for purposes of
Section 3.2
and
Section 3.10(a)
, which matters shall only be
disclosed by specific disclosure in the respective corresponding section of the Company Disclosure Letter and (y) disclosures in the "Risk Factors" or "Forward-Looking Statements" sections of
such reports and other disclosures that are similarly predictive or forward-looking in nature) and (A) then only to the extent that the relevance of any disclosed event, item or occurrence in
such Company SEC Documents to a matter covered by a representation or warranty set forth in this
Article 3
is reasonably apparent as to matters
or items which are subject of such representation or warranty and (B) without giving effect to any amendment to any such documents filed on or after the date hereof) or (ii) in the
disclosure letter delivered by the Company to Parent concurrently with the execution of this Agreement (the "
Company Disclosure Letter
") (it being
agreed that disclosure of any item in any section or subsection of the Company Disclosure Letter shall be deemed disclosed with respect to any other section or subsection of the Company Disclosure
Letter to the extent that the relevance thereof is reasonably apparent (other than matters required to be disclosed for purposes of
Section 3.2
and
Section 3.10(a)
, which matters shall only be disclosed by specific disclosure in the respective corresponding section of the Company
Disclosure Letter)), the Company represents and warrants to Parent and Merger Sub as follows:
Section 3.1
Qualification; Organization; Subsidiaries
.
(a) Each
of the Company and its Subsidiaries (i) is a legal entity duly organized, validly existing and, where applicable, in good standing under the Laws of its
respective jurisdiction of organization; (ii) has all requisite corporate or similar power and authority to own, lease and operate its properties and assets and to carry on its business as
presently conducted; and (iii) is qualified to do business and is in good standing as a foreign corporation in each jurisdiction where the ownership, leasing or operation of its assets or
properties or conduct of its business requires such qualification, except, in the case of clauses (ii) and (iii), as would not have, individually or in the aggregate, a Company Material Adverse
Effect.
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(b) All
of the outstanding shares of capital stock or voting securities of, or other equity interests in, each of the Company's Subsidiaries (i) have been duly
authorized, validly issued and are fully paid and nonassessable and (ii) are owned by the Company, by another Subsidiary of the Company or by the Company and another Subsidiary of the Company,
free and clear of all Liens other than restrictions imposed by applicable securities Laws or the organizational documents of any such Subsidiary. Except for the Company's Subsidiaries and marketable
securities held for investment or cash management purposes, the Company does not own, directly or indirectly, any capital stock of, or other equity or voting interest in, any Person.
Section 3.2
Capitalization
.
(a) The
authorized share capital of the Company consists of 110,000,000 shares of Common Stock and 10,000,000 shares of preferred stock, without par value (the
"
Preferred Stock
"). As of August 26, 2016, there were (i) 22,268,205 shares of Common Stock issued and outstanding and no shares of
Preferred Stock issued and outstanding, (ii) 5,031,910 Shares were reserved for issuances pursuant to the Company Stock Plan, of which there are (A) Company Options to purchase an
aggregate of 1,248,235 shares of Common Stock issued and outstanding, and (B) 1,082,727 shares of Common Stock underlying outstanding Company RSUs. As of the date hereof, there are outstanding
$150,000,000 principal amount of Convertible Notes and the conversion rate applicable to the Convertible Notes (without giving effect to any "make-whole amount") is 16.3303 shares of Company Stock per
$1,000 principal amount of Convertible Notes. All outstanding Shares are duly authorized, validly issued, fully paid and nonassessable, and are not subject to and were not issued in violation of any
preemptive or similar right, purchase option, call or right of first refusal or similar right.
Section 3.2
of the Company Disclosure Letter
contains a correct and complete list, as of the date set forth therein, of the Company Options and Company RSUs including the holder, date of grant, term, number of Shares and, where applicable,
exercise price and vesting schedule, and as of such date there were no other awards granted pursuant to the Company Benefits Plans. All Shares are "covered securities" as defined in
Section 18(b)(1)(A) of the Securities Act and, assuming they remain covered securities as of the record date for the vote of holders of Shares to approve the Merger, holders of Shares shall not
be entitled under the IBCL to exercise dissenters' rights under Ind. Code Section 23-1-44-8(b).
(b) Except
as set forth in
Section 3.2(a)
, and other than the exercise of options pursuant to the terms of the Company
Benefit Plans and for the vesting of options and Company RSUs pursuant to the terms of the Company Benefit Plans, (i) the Company does not have any shares of its capital stock issued or
outstanding other than Shares of Common Stock that have become outstanding after August 26, 2016, which were reserved for issuance as of August 26, 2016 as set forth in
Section 3.2(a)
,
and (ii) other than the Convertible Notes and Capped Call Transactions, there are no outstanding subscriptions, options,
warrants, calls, convertible securities or other similar rights, agreements or commitments relating to the issuance of capital stock to which the Company or any of the Company's Subsidiaries is a
party obligating the Company or any of the Company's Subsidiaries to (A) issue, transfer or sell any shares of capital stock or other equity interests of the Company or any Subsidiary of the
Company or securities convertible into, exercisable for or exchangeable for such shares or
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equity
interests, (B) grant, extend or enter into any such subscription, option, warrant, call, convertible securities or other similar right, agreement or arrangement, (C) repurchase,
redeem or otherwise acquire any such shares of capital stock or other equity interests, (D) provide a material amount of funds to, or make any material investment (in the form of a loan,
capital contribution or otherwise) in, any Subsidiary, or (E) make any payments based on the price or value of any equity interests of the Company or any of the Company's Subsidiaries.
(c) Except
for (i) the Convertible Notes and Capped Call Transactions and (ii) awards to acquire Shares of Common Stock under any equity incentive plan of the
Company and its Subsidiaries, neither the Company nor any of its Subsidiaries has outstanding bonds, debentures, notes or other obligations, the holders of which have the right to vote (or which are
convertible into, exercisable for or exchangeable for securities having the right to vote) with the shareholders of the Company on any matter.
(d) Other
than the Voting Agreement, there are no Contracts, voting trusts or other agreements or understandings to which the Company or any of its Subsidiaries is a party
with respect to the voting of, restricting the transfer of, requiring registration of, or granting any preemptive rights, anti-dilutive rights (except the Company Benefit Plans and the Convertible
Notes and Capped Call Transactions) or rights of first refusal or similar rights of the capital stock or other equity interest of the Company or any of its Subsidiaries.
Section 3.3
Corporate Authority Relative to This Agreement; No
Violation
.
(a) The
Company has the requisite corporate power and authority to enter into this Agreement and, subject to receipt of the Company Shareholder Approval, to consummate the
transactions contemplated hereby. The Board of Directors of the Company at a duly held meeting has (i) determined that it is in the best interests of the Company, and declared it advisable, to
enter into this Agreement, (ii) approved the execution, delivery and performance of this Agreement, the Voting Agreement and the consummation of the transactions contemplated hereby and
thereby, including the Merger, and (iii) adopted the plan of merger set forth in this Agreement and resolved to recommend that the shareholders of the Company approve this Agreement (the
"
Recommendation
") and directed that such matter be submitted for consideration of the shareholders of the Company at the Company Meeting. Except for the
Company Shareholder Approval and the filing of the Articles of Merger with the Secretary of State of the State of Indiana, no other corporate proceedings on the part of the Company are necessary to
authorize the consummation of the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by the Company and, assuming this Agreement constitutes the valid
and binding agreement of Parent and Merger Sub, constitutes the valid and binding agreement of the Company, enforceable against the Company in accordance with its terms.
(b) The
execution, delivery and performance by the Company of this Agreement and the consummation of the transactions contemplated hereby, including the Merger, by the
Company do not and will not require the Company or its Subsidiaries to procure, make or provide any consent, approval, authorization or permit of, action by, filing with or notification to any United
States or
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foreign,
state or local governmental agency, commission, court, body, entity or authority (each, a "
Governmental Entity
"), other than (i) the
filing of the Articles of Merger, (ii) the filing of the pre-merger notification report under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations
promulgated thereunder (the "
HSR Act
"), and any foreign filings required or advisable under any applicable foreign Antitrust Law or foreign investment
Law, (iii) compliance with the applicable requirements of the Exchange Act, including the filing of the Proxy Statement, (iv) compliance with the rules and regulations of Nasdaq,
(v) compliance with any applicable foreign or state securities or blue sky Laws and (vi) the other consents and/or notices set forth on
Section 3.3(b)
of the Company Disclosure Letter
(collectively, clauses (i) through (vi), the "
Specified
Approvals
"), and other than any consent, approval, authorization, permit, action, filing or notification the failure of which to make or obtain would not (A) have,
individually or in the aggregate, a Company Material Adverse Effect or (B) prevent or materially delay the consummation of the Merger.
(c) Assuming
compliance with the matters referenced in
Section 3.3(b)
, receipt of the Specified Approvals and the
receipt of the Company Shareholder Approval, the execution, delivery and performance by the Company of this Agreement and the consummation by the Company of the transactions contemplated hereby,
including the Merger, do not and will not (i) contravene or conflict with the organizational or governing documents of the Company or any of its Subsidiaries, (ii) contravene or conflict
with or constitute a violation of any provision of any Law binding upon or applicable to the Company or any of its Subsidiaries or any of their respective properties or assets or (iii) result
in any violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or to the loss of a
benefit under any Contract, instrument, permit, concession, franchise, right or license binding upon the Company or any of its Subsidiaries or result in the creation of any Lien upon any of the
properties or assets of the Company or any of its Subsidiaries, other than, in the case of clauses (ii) and (iii), any such contravention, conflict, violation, default, termination,
cancellation, acceleration, right, loss or Lien that would not have, individually or in the aggregate, a Company Material Adverse Effect.
Section 3.4
Reports and Financial
Statements
.
(a) The
Company has filed or furnished all forms, documents and reports required to be filed or furnished by it with the SEC since January 1, 2014, and after the date
of this Agreement and until the Effective Time the Company will file or furnish all forms, documents and reports required to be filed or furnished by it with the SEC, each of which, in each case as of
its date, or, if amended, as finally amended prior to the date of this Agreement, complied or will comply, as the case may be, as to form in all material respects with the applicable requirements of
the Securities Act and the Exchange Act and the Sarbanes-Oxley Act, as the case may be, and the applicable rules and regulations promulgated thereunder, as of the date filed with the SEC (the
"
Company SEC Documents
"). None of the Company SEC Documents filed or furnished since January 1, 2014 contained or will contain any untrue
statement of a material fact or omitted or will omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which
they were made, not misleading.
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(b) The
consolidated financial statements (including all related notes and schedules) of the Company included in the Company SEC Documents (if amended, as of the date of the
last such amendment) (i) have been or will be, as the case may be, prepared in accordance with GAAP consistently applied by the Company during the periods and at the dates indicated therein
(except as may be indicated in the notes thereto), (ii) complied or will comply, as the case may be, with the then applicable accounting requirements and published rules and regulations of the
SEC with respect thereto, and (iii) fairly presented or will fairly present, as the case may be, in all material respects the consolidated financial position of the Company and its consolidated
Subsidiaries, as at the respective dates thereof, and the consolidated results of their operations and their consolidated cash flows for the respective periods then ended (subject, in the case of the
unaudited statements, to normal year-end audit adjustments and to any other adjustments described therein, including the notes thereto) in conformity with GAAP (except, in the case of the unaudited
statements, as permitted by the SEC) applied on a consistent basis during the periods involved (except as may be indicated therein or in the notes thereto).
(c) Since
January 1, 2014, neither the Company nor any of its Subsidiaries has received from the SEC or any other Governmental Entity any written comments or
questions with respect to any of the Company SEC Documents (including the financial statements included therein) or any registration statement filed by any of them with the SEC or any notice from the
SEC or other Governmental Entity that such Company SEC Documents (including the financial statements included therein) or registration statements are being reviewed or investigated. To the Knowledge
of the Company, there is not, as of the date of this Agreement, any investigation or review being conducted by the SEC or any other Governmental Entity of any Company SEC Documents (including the
financial statements included therein), except in each case for such comments, questions, notices, investigations or reviews which have been fully resolved. None of the Company's Subsidiaries is
required to file any forms, reports, schedules, statements or other documents with the SEC.
(d) Since
January 1, 2014, no executive officer of the Company has failed to make the certifications required of him or her under Section 302 or 906 of the
Sarbanes-Oxley Act with respect to any Company SEC Documents, except as disclosed in certifications filed with the Company SEC Documents, and at the time of filing or submission of each such
certification, such certification was true and accurate in all material respects and complied in all material respects with the Sarbanes-Oxley Act. Since January 1, 2014, neither the Company
nor any of its executive officers has received written notice from any Governmental Entity challenging or questioning the accuracy, completeness, form or manner of filing of such certifications.
Section 3.5
Internal Controls and
Procedures
.
(a) The
Company has established and maintains disclosure controls and procedures and internal controls over financial reporting (as such terms are defined in
paragraphs (e) and (f), respectively, of Rule 13a-15 under the Exchange Act) as required by Rule 13a-15 under the Exchange Act. The Company's internal control over financial
reporting is sufficient to provide reasonable assurance that (i) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP,
(ii) receipts and expenditures are being made in accordance with the authorization of management and directors of the Company, and (iii) any unauthorized use, acquisition or disposition
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of
the Company's assets that would materially affect the Company's financial statements would be detected or prevented in a timely manner. The Company's disclosure controls and procedures are
reasonably designed to ensure that all material information required to be disclosed by the Company in the reports that it files or furnishes under the Exchange Act is recorded, processed, summarized
and reported within the time periods specified in the rules and forms of the SEC, and that all such material information is accumulated and communicated to the Company's management as appropriate to
allow timely decisions regarding required disclosure and to make the certifications required pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act. The Company's management has completed
an assessment of the effectiveness of the Company's internal controls over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act for the year ended December 31, 2015, and
such assessment concluded that such controls were effective.
(b) Since
January 1, 2014, neither the Company nor any of its Subsidiaries (including any employee thereof) nor the Company's independent auditors has identified or
been made aware of (i) any material weakness in the system of internal accounting controls utilized by the Company and its Subsidiaries, (ii) any fraud, whether or not material, that
involves the Company's management or other employees who have a role in the preparation of financial statements or the internal accounting controls utilized by the Company and its Subsidiaries or
(iii) any claim or allegation regarding any of the foregoing. Since January 1, 2014, neither the Company nor any of its Subsidiaries nor, to the Knowledge of the Company, any director,
officer, employee, auditor, accountant, consultant or representative of the Company or any of its Subsidiaries has received any material written substantive complaint, allegation, assertion or claim
that the Company or any of its Subsidiaries has engaged in questionable accounting or auditing practices.
Section 3.6
No Undisclosed
Liabilities
.
Except (a) as disclosed, reflected or reserved against in the consolidated balance sheet of the Company and its
Subsidiaries as of December 31, 2015 (or the notes thereto), (b) as expressly contemplated by this Agreement, (c) for liabilities or obligations that have been discharged or paid
in full, (d) for liabilities and obligations incurred in the ordinary course of business since December 31, 2015 and (e) as would not have, individually or in the aggregate, a
Company Material Adverse Effect, neither the Company nor any consolidated Subsidiary of the Company has any
liabilities or obligations that would be required by GAAP to be reflected on a consolidated balance sheet of the Company and its Subsidiaries (or the notes thereto).
Section 3.7
Affiliate Party Transactions.
Since
January 1, 2014, there have been no transactions, agreements, arrangements or understandings between the Company or any of its Subsidiaries on the one hand, and any Affiliate of the Company
(other than the Company's Subsidiaries) or between the Company and any present or former director or executive officer of the Company or any of its Affiliates, that would be required to be disclosed
under Item 404 under Regulation S-K under the Securities Act and that have not been so disclosed in the Company SEC Documents.
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Section 3.8
Compliance with Law;
Permits
.
(a) The
Company and its Subsidiaries have since January 1, 2014, been in compliance with and not in default under or in violation of any applicable material federal,
state, local or foreign law, statute, ordinance, rule, regulation, judgment, order, injunction or decree of any Governmental Entity (collectively,
"
Laws
" and each, a "
Law
"), including all applicable data privacy and data protection Laws and Export and
Import Control Laws. As of the date of this Agreement, neither the Company nor any of its Subsidiaries has received any written notice of any administrative, civil or criminal investigation or audit
by any Governmental Entity alleging any material violation by the Company or any of its Subsidiaries of any applicable Law that remains outstanding or unresolved.
(b) Neither
the Company nor its Subsidiaries nor any officers, directors or employees of the Company or its Subsidiaries nor, to the Knowledge of the Company, any agents,
representatives, or other persons associated with or acting on behalf of the Company or its Subsidiaries have since January 1, 2013, directly or indirectly, taken any action in violation of any
applicable Anti-Corruption Laws. The Company and its Subsidiaries maintain policies and procedures reasonably designed to ensure compliance with all applicable Anti-Corruption Laws.
(c) The
Company and its Subsidiaries are in possession of and compliance with all franchises, grants, authorizations, licenses, permits, easements, variances, exceptions,
consents, certificates, approvals and orders of any Governmental Entity necessary for the Company and the Company's Subsidiaries to own, lease and operate their properties and assets or to carry on
their businesses as they are now being conducted (the "
Company Permits
"), except where the failure to have or comply with any of the Company Permits
would not have, individually or in the aggregate, a Company Material Adverse Effect. All Company Permits are in full force and effect, except where the failure to be in full force and effect would not
have, individually or in the aggregate, a Company Material Adverse Effect. The Company is not a common carrier nor does it provide common carrier services, including international telecommunications
services, and is therefore not subject to applicable Laws imposing obligations on such carriers, including but not limited to regulations adopted by the United States Federal Communications
Commission, except to the extent that the United States Federal Communications Commission has applied such laws to, and/or imposed such obligations on, interconnected Voice-over-Internet-Protocol
service or providers thereof.
Section 3.9
Employee Benefit Plans; Labor
Matters
.
(a)
Section 3.9(a)
of the Company Disclosure Letter lists all material Company Benefit Plans other than Company
Foreign Plans. "
Company Benefit Plans
" means all employee, independent contractor or director compensation and/or benefit plans, programs, policies,
agreements or other arrangements, including any employee welfare plan within the meaning of Section 3(1) of the Employee Retirement Income Security Act of 1974, as amended
("
ERISA
"), any employee pension benefit plan within the meaning of Section 3(2) of ERISA (whether or not such plan is subject to ERISA), and any
bonus, incentive, deferred compensation, vacation, stock purchase, stock option, restricted stock, other equity-based awards, severance, salary continuation, retention, profit sharing, termination,
employment, change of control, savings, life insurance, or fringe benefit plan, program or agreement (other
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than
any "multiemployer plan" within the meaning of Section 4001(a)(3) of ERISA (a "
Multiemployer Plan
")), in each case that are sponsored,
maintained or contributed to by the Company or any of its Subsidiaries for the benefit of current or former employees, directors or consultants of the Company or its Subsidiaries.
"
Company Foreign Plan
" means each Company Benefit Plan that is subject to or governed by the Laws of any jurisdiction other than the United States.
(b) The
Company has made available to Parent, with respect to each material Company Benefit Plan, (i) each writing constituting a part of such Company Benefit Plan,
including all amendments thereto, (ii) the most recent Annual Report (Form 5500 Series) and accompanying schedules, if any, and (iii) the most recent determination letter from the
Internal Revenue Service (if applicable) for such Company Benefit Plan. To the Knowledge of the Company, neither the Company nor any of its Subsidiaries has disseminated in writing any legally binding
intent or commitment to create or implement any additional employee benefit plan that would be a Company Benefit Plan if in existence on the date hereof, or to amend, modify or terminate any Company
Benefit Plan, in each case that would result in the incurrence of a material liability by the Company and its Subsidiaries taken as a whole.
(c) Except
as would not be reasonably expected to result in material liability to the Company or its Subsidiaries: (i) each Company Benefit Plan has been maintained
and administered in compliance with its terms and with applicable Law, including ERISA and the Code to the extent applicable thereto and neither the Company nor any of its Subsidiaries has, within the
past six years, taken any corrective action or made a filing under any voluntary correction program of the Internal Revenue Service, Department of Labor or any other Governmental Entity with respect
to any Company Benefit Plan and the Company has no Knowledge of any plan defect that would qualify for correction under any such program; (ii) each Company Benefit Plan intended to be
"qualified" within the meaning of Section 401(a) of the Code has received a favorable determination letter from the Internal Revenue Service or is entitled to rely upon a favorable opinion
issued by the Internal Revenue Service, and, to the Knowledge of the Company, there are no existing circumstances or any events that have occurred that could reasonably be expected to adversely affect
the qualified status of any such plan; (iii) no Company Benefit Plan is subject to Title IV of ERISA; (iv) no Company Benefit Plan provides retiree life insurance, medical or other
welfare benefits with respect to current or former employees or directors of the Company or its Subsidiaries beyond their retirement or other termination of service, other than (A) coverage
mandated by applicable Law or (B) benefits not in excess of 12 months under severance arrangements; (v) no liability under Title IV of ERISA has been incurred by the Company, its
Subsidiaries or any ERISA Affiliate (as defined below) of the Company that has not been satisfied in full (other than with respect to amounts not yet due), and no condition exists that presents a risk
to the Company, its Subsidiaries or any ERISA Affiliate of the Company of incurring a liability thereunder; (vi) all contributions or other amounts payable by the Company or its Subsidiaries as
of the date hereof with respect to each Company Benefit Plan in respect of current or prior plan years have been paid or accrued in accordance with GAAP (other than with respect to amounts not yet
due); (vii) (A) no employee benefit plan of the Company or its Subsidiaries is a Multiemployer Plan, a plan that has two or more contributing sponsors, at least two of whom are not under
common control, within the meaning of Section 4063 of ERISA ("
Multiple Employer Plan
") or a voluntary employees' beneficiary association under
Section 501(c)(9) of the Code, (B) none of the Company and its
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Subsidiaries,
nor any of their ERISA Affiliates has, at any time during the last six (6) years, contributed to or been obligated to contribute to any Multiemployer Plan or Multiple Employer
Plan and (C) none of the Company and its Subsidiaries, nor any of their ERISA Affiliates has incurred any withdrawal liability that has not been satisfied in full; (viii) none of the
Company, any of its Subsidiaries, or, to the Knowledge of the Company, any of their respective directors, officers, employees or agents has, with
respect to any Company Benefit Plan, engaged in or been a party to any non-exempt "prohibited transaction," as such term is defined in Section 4975 of the Code or Section 406 of ERISA,
which could reasonably be expected to result in the imposition of a penalty assessed pursuant to Section 502(i) of ERISA or a tax imposed by Section 4975 of the Code and
(ix) there are no pending, threatened or, to the Knowledge of the Company, anticipated claims (other than claims for benefits in accordance with the terms of the Company Benefit Plans) by, on
behalf of or against any of the Company Benefit Plans or any trusts related thereto that could reasonably be expected to result in any liability of the Company or any of its Subsidiaries.
"
ERISA Affiliate
" means, with respect to any entity, trade or business, any other entity, trade or business that is a member of a group described in
Section 414(b), (c), (m) or (o) of the Code or Section 4001(b)(1) of ERISA that includes the first entity, trade or business, or that is a member of the same "controlled
group" as the first entity, trade or business pursuant to Section 4001(a)(14) of ERISA. Each Company Benefit Plan can be amended, terminated or otherwise discontinued after the Effective Time
in accordance with its terms, without any material liability to Parent, the Surviving Corporation, the Company or any of its Subsidiaries other than ordinary administration expenses typically incurred
in a termination event.
(d) Except
as provided in this Agreement or required by applicable Law or the terms of any Company Benefit Plan set forth on
Section 3.9(a)
of the Company Disclosure Letter, the consummation of the
transactions contemplated by this Agreement will not, either alone or in
combination with another event, (i) entitle any current or former employee, director, independent contractor, or consultant of the Company or any of its Subsidiaries to severance pay, change of
control payment or any other payment from the Company or its Subsidiaries, (ii) accelerate the time of payment, funding (through a grantor trust or otherwise) or vesting, or increase the amount
of, compensation due to any such director, employee, independent contractor or consultant, or (iii) result in any limitation on the right of the Company or any of its Subsidiaries to amend,
merge, terminate or receive a reversion of assets from any Company Benefit Plan or related trust.
(e) No
Company Benefit Plan provides for the gross-up or reimbursement of Taxes under Section 4999 or Section 409A, or otherwise.
(f) No
Company Benefit Plan that is subject to Section 409A of the Code and the regulations and guidance thereunder
("
Section 409A
") has been materially modified (as defined under Section 409A) since October 3, 2004 and all such non-qualified
deferred compensation plans or arrangements have been at all times since January 1, 2005 (of, if later, the date it became effective) in operational compliance with Section 409A and at
all times since January 1, 2009 (of, if later, the date it became effective) in documentary compliance with Section 409A. Each Company Option (A) was granted in compliance with
all applicable Laws and all of the terms and conditions of the Company Stock Plan pursuant to which it was issued, (B) has an exercise price per Share equal to or greater than the fair market
value of a Share on the date of such grant, (C) has a grant date identical to or after the date
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on which the Company's Board of Directors or applicable committee actually awarded such Company Option, and (D) qualifies for the Tax and accounting treatment afforded
to such Company Option in the Company's Tax returns and financial statements, respectively.
(g) No
material deduction for federal income tax purposes has been nor is any such material deduction expected by the Company to be disallowed for remuneration paid by the
Company or any of its Subsidiaries by reason of Section 162(m) of the Code including by reason of the transactions contemplated hereby.
(h) Except
as would not be reasonably expected to result in material liability to the Company or its Subsidiaries, all Company Foreign Plans (i) have been maintained
in accordance with all applicable requirements, (ii) that are intended to qualify for special Tax treatment meet all material requirements for such treatment and (iii) that are required
to be funded and/or book-reserved are funded and/or book-reserved, as appropriate, based upon reasonable actuarial assumptions and in accordance with applicable Law.
(i) Neither
the Company nor any of its Subsidiaries is a party to any Contract or arrangement between or applying to, one or more employees or other service providers and a
union, trade union, works council, group of employees or any other employee representative body, for collective bargaining or other negotiating or consultation purposes or reflecting the outcome of
such collective bargaining or negotiation or consultation with respect to their respective employees with any labor organization, union, group, association, works council or other employee
representative body, or is bound by any equivalent national or sectoral agreement, Except for such matters that would be reasonably expected to result in material liability to the Company or its
Subsidiaries: (i) as of the date hereof, (A) there are no strikes or lockouts with respect to any employees of the Company or any of its Subsidiaries; (B) to the Knowledge of the
Company, there is no union organizing effort pending or threatened against the Company or any of its Subsidiaries; (C) there is no unfair labor practice, labor dispute (other than routine
individual grievances) or labor arbitration proceeding pending or, to the Knowledge of the Company, threatened against the Company or any of its Subsidiaries; and (D) there is no slowdown, or
work stoppage in effect or, to the Knowledge of the Company, threatened with respect to employees of the Company or any of its Subsidiaries; and (ii) the Company and its Subsidiaries are in
compliance with all applicable Laws in respect of (A) employment and employment practices, (B) terms and conditions of employment and wages and hours, (C) unfair labor practices
and (D) proper classification of individuals who currently render services or have previously rendered services to the Company or any of its Subsidiaries as employees or non-employees as
applicable.
(j) Except
as would not be reasonably expected to result in material liability to the Company or its Subsidiaries, each of the Company and its Subsidiaries is in compliance
in all material respects with WARN. In the past three years, (i) neither the Company nor any of its Subsidiaries has effectuated a "plant closing" (as defined in WARN) affecting any site of
employment or one or more facilities or operating units within any site of employment or facility of its business, (ii) there has not occurred a "mass layoff" (as defined in WARN) affecting any
site of employment or facility of the Company or any of its Subsidiaries, and (iii) neither the Company nor any of its Subsidiaries has been affected by any transaction or engaged in layoffs or
employment terminations sufficient in number, including as aggregated, to trigger application of any similar state, local or foreign law or regulation.
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Section 3.10
Absence of Certain Changes or
Events
.
Since December 31, 2015, (a) there has not been or there does not exist, as the case may be, any event, change,
occurrence or development that has had or would reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect, (b) except for actions expressly
contemplated by this Agreement, the business of the Company and its Subsidiaries has been conducted, in all material respects, in the ordinary course consistent with past practice, and
(c) except for actions expressly contemplated by this Agreement, neither the Company nor any of its Subsidiaries has taken any action that, if taken after the date of this Agreement without the
prior written consent of Parent would constitute a breach of clauses (i), (ii), (iv), (v), (vi), (ix), (x) or (xii) through (xvii) of
Section 5.1(b)
. Since June 30, 2016,
except for actions expressly contemplated by this
Agreement, neither the Company nor any of its Subsidiaries has taken any action that, if taken after the date of this Agreement without the prior written consent of Parent would constitute a breach of
clause (iii) of
Section 5.1(b)
.
Section 3.11
Investigations;
Litigation
.
As of the date hereof: (a) there is no investigation or review pending (or, to the Knowledge of the Company, threatened)
by any Governmental Entity with respect to the Company or any of the Company's Subsidiaries that would have, individually or in the aggregate, a Company Material Adverse Effect; and (b) there
are no Actions pending (or, to the Knowledge of the Company, threatened) against or affecting the Company or any of the Company's Subsidiaries, or any of their respective properties at law or in
equity before, and there are no orders, judgments or decrees of, or before, any Governmental Entity, in each case that involves an amount in controversy in excess of $500,000 or seeks specific
performance or injunctive relief that would be material to the Company and its Subsidiaries, taken as a whole.
Section 3.12
Proxy Statement; Other
Information
.
The proxy statement to be filed by the Company with the SEC in connection with seeking the approval by the shareholders of the
Company of the adoption of this Agreement (including the letter to shareholders, notice of meeting and form of proxy, the "
Proxy Statement
") will not,
at the time it is filed with the SEC, or at the time it is first mailed to the shareholders of the Company and at the time of the Company Meeting, contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading. The Company
will cause the Proxy Statement to comply as to form in all material respects with the requirements of the Exchange Act applicable thereto as of the date of such filing. No representation is made by
the Company with respect to statements made in the Proxy Statement based on information supplied, or required to be supplied, by or on behalf of Parent, Merger Sub or any of their Affiliates for
inclusion or incorporation by reference therein.
Section 3.13
Tax Matters
.
(a) Except
as would not have, individually or in the aggregate, a Company Material Adverse Effect: (i) the Company and each of its Subsidiaries have prepared and
timely filed (taking into account any extension of time within which to file) all Tax Returns required to be filed by any of them
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and
all such filed Tax Returns are complete and accurate; (ii) the Company and each of its Subsidiaries have paid in full on a timely basis all Taxes required to be paid or have established
adequate reserves in accordance with GAAP; (iii) there are no liens for Taxes upon any property of the Company or any of its Subsidiaries, except for Permitted Liens; (iv) the Company
and each of its Subsidiaries have complied in all material respects with all applicable Laws relating to the payment, collection, withholding and remittance of Taxes (including information reporting
requirements), including with respect to payments made to any employee, independent contractor, creditor, stockholder or other third party, and have timely collected, deducted or withheld and paid
over to the appropriate Governmental Entity all amounts required to be so collected, deducted or withheld and paid over in accordance with applicable Laws; and (v) neither the Company nor any
of its subsidiaries will be required to include any item of income in, or exclude any item of deduction from, taxable income for a taxable period (or portion thereof) ending after the Closing Date as
a result of any (A) adjustment pursuant to Section 481 of the Code (or any analogous provision of state, local or non-U.S. Law) for a taxable period ending on or before the Closing Date,
(B) "closing agreement" as described in Section 7121 of the Code (or any analogous provision of state, local or non-U.S. Law) executed on or prior to the Closing Date,
(C) installment sale, intercompany transaction or open transaction disposition made or entered into on or prior to the Closing Date, (D) prepaid amount received on or prior to the
Closing Date or (E) election by the Company or any of its Subsidiaries under Section 108(i) of the Code (or any analogous provision of state, local or non-U.S. Law).
(b) As
of the date of this Agreement, there are not pending or, to the Knowledge of the Company, threatened in writing, any audits, examinations, investigations or other
proceedings in respect of material Taxes of the Company or any of its Subsidiaries. Neither the Company nor any of its Subsidiaries has waived any statute of limitations in respect of material Taxes
or agreed to any extension of time with respect to a material Tax assessment or deficiency.
(c) Neither
the Company nor any of its Subsidiaries has been a "controlled corporation" or a "distributing corporation" in any distribution occurring during the two-year
period ending on the date hereof that was purported or intended to be governed by Section 355 of the Code.
(d) Neither
the Company nor any of its Subsidiaries has entered into any "listed transaction" within the meaning of Treasury Regulations Section 1.6011-4(b)(2).
(e) Neither
the Company nor any of its Subsidiaries is a party to or bound by any Contract to allocate, share or indemnify another Person for Taxes (other than
(i) any customary agreements with customers, vendors, lenders, lessors or the like entered into in the ordinary course of business and (ii) property Taxes payable with respect to
properties leased).
(f) Neither
the Company nor any of its Subsidiaries has a permanent establishment (within the meaning of an applicable Tax treaty) in a country other than the country in
which it is organized.
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(g) Neither
the Company nor any of its Subsidiaries has been a member of an affiliated group filing a consolidated federal income Tax return (other than a group the common
parent of which was the Company).
(h) "
Taxes
" means (i) any and all federal, state, local or foreign taxes of any kind (together with any and all
interest, penalties, additions to tax and additional amounts imposed with respect thereto) imposed by any Governmental Entity, including income, franchise, windfall or other profits, gross receipts,
property, sales, use, capital stock, payroll, employment, unemployment, social security, workers' compensation, net worth, excise, withholding, ad valorem and value added taxes and (ii) any
liability for items described in clause (i) payable by reason of Contract, assumption, transferee or successor liability, operation of Law, Treasury Regulation Section 1.1502-6 (or any
similar provision of Law) or otherwise. "
Tax Return
" means any return, report or similar filing (including the attached schedules) required to be filed
with respect to Taxes, including any information return, claim for refund, amended return or declaration of estimated Taxes.
Section 3.14
Intellectual
Property
.
(a) The
Company and its Subsidiaries either own or have a right to use such patents, trademarks, trade names, service marks, domain names, copyrights and any applications
and registrations for any of the foregoing (including intent-to-use applications), trade secrets, know-how, technology, computer software and other tangible and intangible proprietary information and
intellectual property rights (collectively, "
Intellectual Property
") as are necessary to conduct the business of the Company and its Subsidiaries as
conducted by the Company and its Subsidiaries as of the date hereof in all material respects. Neither the Company nor any of its Subsidiaries has infringed, misappropriated or violated any
Intellectual Property of any third party in the past three years, provided that the foregoing representation is given to Knowledge with respect to patents. To the Knowledge of the Company, no third
party is currently infringing, misappropriating or violating any Intellectual Property owned by or exclusively licensed to the Company or any of its Subsidiaries.
(b) Except
pursuant to a non-exclusive license agreement entered into with the customers in the ordinary course of business, no Person (other than the Company or any of its
Subsidiaries) has an interest in or any right to use any Intellectual Property owned by the Company ("
Company Owned Intellectual Property
").
(c) As
of the date of this Agreement, there are no Actions pending or, to the Knowledge of the Company, threatened, that challenge or question the Company's ownership or
right to use Intellectual Property of the Company or any of its Subsidiaries.
(d) The
Company and its Subsidiaries have taken reasonable steps to maintain the confidentiality of or otherwise protect and enforce their rights in all Intellectual
Property owned by them, and to protect and preserve through the use of customary non-disclosure agreements the confidentiality of all confidential information that is owned or held by the Company and
its Subsidiaries and used in the conduct of the business. Neither the Company nor any of its Subsidiaries has experienced any material cybersecurity or other data breach or misappropriation.
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(e) All
personnel, including employees, agents, consultants and contractors, who have contributed to or participated in the conception or development, or both, of material
Intellectual Property owned by the Company and its Subsidiaries (i) have been and are a party to "work-for-hire" arrangements with the Company or one of its Subsidiaries or (ii) have
assigned to the Company or one of its Subsidiaries ownership of all tangible and intangible property arising in connection with the conception or development of such Intellectual Property.
The
transactions contemplated by this Agreement will not impair or diminish the rights of the Company or any of its Subsidiaries in and to the Company Owned Intellectual Property in any material
respect.
(f) The
generality of any other representations and warranties in this Agreement notwithstanding, the representations and warranties in this
Section 3.14
shall be deemed to be the Company's sole and
exclusive representations and warranties in this Agreement with respect to infringement
of third party Intellectual Property.
Section 3.15
Real
Property
.
Except as would not have, individually or in the aggregate, a Company Material Adverse Effect: (a) the Company or a
Subsidiary of the Company has good and valid title or valid leasehold interests, as applicable, in all of its owned or leased real property, free and clear of all Liens (except for Permitted Liens and
all other title exceptions, changes, defects, easements, restrictions, encumbrances and other matters, whether or not of record, that do not materially affect the continued use of the applicable
property for the purposes for which such property is currently being used by the Company or a Subsidiary of the Company as of the date hereof); (b) as of the date hereof, each lease, license,
sublease and occupancy agreement (each, a "
Lease
") with respect to real property leased, licensed, subleased or otherwise used by the Company or its
Subsidiaries as lessee or sublessee (together with real property owned by the Company and its Subsidiaries, the "
Real Property
"), is in full force and
effect and enforceable in accordance with their respective terms against the Company or its Subsidiaries that are party thereto and, to the Knowledge of the Company, to the other parties thereto;
(c) as of the date hereof, neither the Company nor any of its Subsidiaries is in material breach or default under any of the Leases; and (d) to the Knowledge of the Company, there is no
pending or written threat of condemnation or similar action affecting any of the Real Property. The Company does not own any Real Property. The Company and its Subsidiaries are, and since
January 1, 2014 have been, in compliance in all material respects with all applicable Environmental Laws. The Company has not received written notice of any Action alleging liability under any
Environmental Law.
Section 3.16
Opinion of Financial
Advisors
.
The Board of Directors of the Company has received the opinion of Union Square Advisors LLC, dated as of the date of this
Agreement, to the effect that, as of such date and subject to the assumptions, limitations, qualifications and other matters stated therein, the Merger Consideration to be received by the holders of
Common Stock in the Merger pursuant to this Agreement is fair, from a financial point of view, to such holders.
Section 3.17
Required Vote of the Company
Shareholders
.
The affirmative vote of the holders of a majority of the outstanding shares of Common Stock is the only vote of holders of
securities of the Company that is required to approve this Agreement and consummate the transactions contemplated hereby, including the Merger (the "
Company Shareholder
Approval
").
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Section 3.18
Material Contracts
.
(a) Except
for this Agreement, or as set forth in
Section 3.18
of the Company Disclosure Letter, as of the date of
this Agreement, neither the Company nor any of its Subsidiaries is a party to or expressly bound by any Contract (excluding any Company Benefit Plan) that:
(i) is
a "material contract" (as such term is defined in Item 601(b)(10) of Regulation S-K of the Securities Act);
(ii) relates
to any joint venture, partnership, limited liability or other similar Contract relating to the formation, creation, operation, management or control of any
joint venture or partnership that is material to the business of the Company and its Subsidiaries, taken as a whole;
(iii) is
an indenture, credit agreement, loan agreement, security agreement, guarantee (other than any guarantee provided with respect to a wholly owned Subsidiary of the
Company), note, mortgage or other Contract providing for or securing indebtedness for borrowed money or deferred payment (in each case, whether incurred, assumed, guaranteed or secured by any asset)
in excess of $1 million;
(iv) is
a settlement, conciliation or similar Contract (x) with any Governmental Entity or (y) which would require the Company or any of its Subsidiaries to
pay consideration of more than $100,000 after the date of this Agreement;
(v) contains
any covenant that materially limits the ability of the Company or any of its Subsidiaries to engage in any line of business, or to compete with any Person or
operate at any geographic location;
(vi) contains
earn-out, exclusivity obligations or similar restrictions or contingent obligations that currently are or in the future will be binding on and are material to
the Company or any of its Subsidiaries or that would be binding on Parent or any of its Affiliates (other than the Company or any of its Subsidiaries) after the Closing;
(vii) restricts
the ability of the Company or any of its Subsidiaries to incur liens to secure indebtedness for borrowed money;
(viii) relates
to the acquisition or disposition of any business, capital stock or all or substantially all of assets of any other Person or any material real property
(whether by merger, sale of stock, sale of assets or otherwise), in any such case having a purchase price of more than $10 million and entered into
at any time during the last five (5) years or otherwise containing material ongoing performance obligations of the Company or any of its Subsidiaries; or
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(ix) is
a contract under which the Company or any of its Subsidiaries uses or has the right to use any Intellectual Property licensed from third parties that is material to
the business of the Company and its Subsidiaries, taken as a whole.
Each
Contract of the type described in this
Section 3.18(a)
is referred to herein as a "
Company Material
Contract
."
(b) The
Company has delivered or made available to Parent true and complete copies of each such Company Material Contract. Neither the Company nor any Subsidiary of the
Company is in breach of or default under the terms of any Company Material Contract where such breach or default would have, individually or in the aggregate, a Company Material Adverse Effect. To the
Knowledge of the Company, no other party to any Company Material Contract is in breach of or default under the terms of any Company Material Contract where such breach or default would have,
individually or in the aggregate, a Company Material Adverse Effect. Except as would not have, individually or in the aggregate, a Company Material Adverse Effect, each Company Material Contract is a
valid and binding obligation of the Company or the Subsidiary of the Company that is party thereto and, to the Knowledge of the Company, of each other party thereto, and is in full force and effect,
except that (i) such enforcement may be subject to applicable bankruptcy, insolvency, reorganization, moratorium or other similar Laws, now or hereafter in effect, relating to creditors' rights
generally and (ii) equitable remedies of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before
which any proceeding therefor may be brought. Except as would not have, individually or in the aggregate, a Company Material Adverse Effect, neither the Company nor any of its Subsidiaries has
received any written notice or claim of default under any Company Material Contract or any written notice of an intention to terminate, not renew or challenge the validity or enforceability of any
Company Material Contract.
Section 3.19
Insurance
Policies
.
Except as is not material to the business of the Company and its Subsidiaries, taken as a whole, (a) all insurance
policies maintained by the Company and its Subsidiaries are in full force and effect and all premiums due and payable thereon have been paid in accordance with the terms of such policies,
(b) neither the Company nor any of its Subsidiaries is in breach or default of any of its insurance policies, and neither the Company nor any of its Subsidiaries has taken any action or failed
to take any action which, with notice or the lapse of time, would constitute such a breach or default or permit termination or modification of any of such policies and (c) other than in
connection with ordinary course renewals, the Company has not received any written notice of termination, cancellation, or non-renewal with respect to any such policy.
Section 3.20
Finders or Brokers;
Fees
.
The Board of Directors of the Company has received the written opinion of its financial advisor, Union Square Advisors LLC,
substantially to the effect that, as of the date of such opinion, and subject to the assumptions, limitations, qualifications and other matters stated therein, the Merger Consideration to be received
by the holders of Common Stock (other than Cancelled Shares or Converted Shares) in the Merger pursuant to this Agreement is fair, from a financial point of view, to such holders (it being understood
and agreed that such written opinion is for the benefit of the Company Board and may not be relied upon by Parent or Merger Sub). The Company's estimate of expenses payable by the Company in
connection with the transactions contemplated by this Agreement to Union Square Advisors LLC is set forth in
Section 3.20
of the Company
Disclosure Letter.
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Section 3.21
Takeover
Laws
.
Assuming the representations and warranties of Parent and Merger Sub set forth in Section 4.11 are true and correct, no "fair
price," "moratorium," "control share acquisition" or other form of antitakeover statute or regulation ("
Takeover Laws
") is applicable to the Agreement,
the Voting Agreement, the Merger and the other transactions contemplated hereby. The actions by the Board of Directors of the Company, prior to execution and delivery of this Agreement and the Voting
Agreement, in approving this Agreement and the Voting Agreement, and the transactions contemplated herein and therein, are sufficient to render inapplicable to this Agreement and the Voting Agreement,
and the transactions contemplated herein and therein, the restrictions on "business combinations" as set forth in Section 23- 1-43-1 to 23-1-43-23 of the ICBL.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB
Parent and Merger Sub jointly and severally represent and warrant to the Company as follows:
Section 4.1
Qualification, Organization,
Subsidiaries
.
Each of Parent and Merger Sub is a legal entity duly organized, validly existing and, where applicable, in good standing
under the Laws of its respective jurisdiction of organization and has all requisite corporate or similar power and authority to own, lease and operate its properties and assets and to carry on its
business as presently conducted and is qualified to do business and is in good standing as a foreign corporation in each jurisdiction where the ownership, leasing or operation of its assets or
properties or conduct of its business requires such qualification, except, in each case, as would not, individually or in the aggregate, prevent or materially delay the Closing or prevent or
materially delay or materially impair the ability of Parent or Merger Sub to satisfy the conditions precedent to the Merger, to obtain financing for the Merger or to consummate the Merger and the
other transactions contemplated by this Agreement (a "
Parent Material Adverse Effect
").
Section 4.2
Corporate Authority Relative to This Agreement; No
Violation
.
(a) Each
of Parent and Merger Sub has all requisite corporate power and authority to enter into this Agreement and to consummate the transactions contemplated hereby. The
execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, including the Merger, have been duly and validly authorized by the Boards of
Directors of Parent and Merger Sub and by Parent, as the sole shareholder of Merger Sub, and, except for the filing of the Articles of Merger with the Secretary of State of the State of Indiana, no
other corporate proceedings on the part of Parent or Merger Sub are necessary to authorize the consummation of the transactions contemplated hereby. This Agreement has been duly and validly executed
and delivered by Parent and Merger Sub and, assuming this Agreement constitutes the valid and binding agreement of the
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Company,
constitutes the valid and binding agreement of Parent and Merger Sub, enforceable against each of Parent and Merger Sub in accordance with its terms.
(b) The
execution, delivery and performance by Parent and Merger Sub of this Agreement and the consummation of the transactions contemplated hereby, including the Merger, by
Parent and Merger Sub do not and will not require Parent, Merger Sub or their Subsidiaries to procure, make or provide any consent, approval, authorization or permit of, action by, filing with or
notification to any Governmental Entity or other third party, other than (i) the filing of the Articles of Merger, (ii) the filing of the pre-merger notification report under the HSR Act
and any foreign filings required or advisable under any applicable foreign Antitrust Law or foreign investment Law, (iii) compliance with any applicable foreign or state securities or blue sky
Laws and (iv) CFIUS Clearance but solely to the extent a CFIUS Request has occurred prior to the Closing (collectively, clauses (i) through (iv), the "
Parent
Approvals
"), and other than any consent, approval, authorization, permit, action, filing or notification the failure of which to make or obtain would not have, individually or
in the aggregate, a Parent Material Adverse Effect. As of the date hereof, none of Parent, Merger Sub or any of their Affiliates intends to make a notification (whether draft or definitive) to the
Committee on Foreign Investment in the United States in connection with the transactions contemplated hereby.
(c) Assuming
compliance with the matters referenced in
Section 4.2(b)
and receipt of the Parent Approvals, the
execution, delivery and performance by Parent and Merger Sub of this Agreement and the consummation by Parent and Merger Sub of the other transactions contemplated hereby, including the Merger, do not
and will not (i) contravene or conflict with the organizational or governing documents of Parent, Merger Sub or any of their Subsidiaries, (ii) contravene or conflict with or constitute
a violation of any provision of any Law binding upon or applicable to Parent, Merger Sub or any of their Subsidiaries or any of their respective properties or assets, or (iii) result in any
violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any material obligation or to the loss of a
material benefit under any Contract, instrument, permit, concession, franchise, right or license binding upon Parent, Merger Sub or any of their Subsidiaries or result in the creation of any Lien
(other than Permitted Liens) upon any of the properties or assets of Parent, Merger Sub or any of their Subsidiaries, other than, in the case of clauses (ii) and (iii), any such contravention,
conflict, violation, default, termination, cancellation, acceleration, right, loss or Lien that would not have, individually or in the aggregate, a Parent Material Adverse Effect.
Section 4.3
Investigations; Litigation
. As of the date hereof, there is no
investigation or review pending (or, to the Knowledge of Parent, threatened) by any Governmental Entity with respect to Parent or any of its Subsidiaries that would have, individually or in the
aggregate, a Parent Material Adverse Effect, and
there are no Actions pending (or, to the Knowledge of Parent, threatened) against or affecting Parent or any of Parent's Subsidiaries, or any of their respective properties at law or in equity before,
and there are no orders, judgments or decrees of, or before, any Governmental Entity, in each case that would have, individually or in the aggregate, a Parent Material Adverse Effect.
Section 4.4
Proxy Statement; Other Information
. None of the information supplied
by or on behalf of Parent, Merger Sub or any of their Affiliates for inclusion or incorporation by reference
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in
the Proxy Statement will, at the time it is filed with the SEC, or at the time it is first mailed to the shareholders of the Company and at the time of the Company Meeting, contain any untrue
statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were
made, not misleading.
Section 4.5
Financing
.
(a) Parent
has delivered to the Company a true, complete and correct copy of the executed debt commitment letter, dated as of the date hereof (together with the exhibits,
schedules and annexes thereto, the "
Debt Commitment Letter
", and as the same may be amended, supplemented or otherwise modified or replaced in
accordance with the terms therein and herein and including any executed commitment letter or similar agreement for Alternative Financing, in each case, pursuant to Section 5.16, and any related
executed fee letter, collectively, the "
Debt Financing Commitments
"), executed by the Parent Parties and the Lenders, pursuant to which the Lenders have
committed, subject to the terms and conditions set forth therein, to provide or cause to be provided to the Parent Parties, debt financing in the aggregate amounts set forth therein (the
"
Debt Financing
").
(b) As
of the date hereof, the Debt Financing Commitments are in full force and effect and are the legal, valid and binding obligations of the Parent Parties and, to the
Knowledge of Parent, the Lenders (except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar laws of general
applicability relating to or affecting creditors' rights, and to general equitable principles, regardless of whether such enforceability is considered in a proceeding in equity or at law (the
"
Bankruptcy and Equity Exceptions
"). As of the date hereof, the Debt Financing Commitments have not been amended, modified or replaced, and the
respective commitments contained in the Debt Financing Commitments have not been withdrawn, terminated or rescinded in any respect as of the date hereof. As of the date hereof, no event has occurred
which, with or without notice, lapse of time or both, would constitute a default or breach on the part of the Parent Parties, or to the Knowledge of Parent, any other Person, under the Debt Financing
Commitments and, assuming the satisfaction of the conditions set forth in
Section 6.1
and
Section 6.3
(other than those conditions that by their
nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of
those conditions at the Closing), Parent has no reason to believe that it will be unable to satisfy on a timely basis any term or condition of closing to be satisfied by it or the other Parent Parties
in the Debt Financing Commitments on or prior to the Closing Date. There are no conditions precedent related to the funding of the full amount of the Debt Financing other than as expressly set forth
in or contemplated by the Debt Financing Commitments. Except for fee letters (complete copies of which have been provided to the Company, with only fee amounts, economic terms, market flex provisions,
securities demand provisions and other customary threshold amounts redacted, none of which redacted terms adversely affect the conditionality, enforceability, termination or availability of the Debt
Financing or reduce the Debt Financing below the Required Amount (as defined below)) and customary fee credit letters or engagement letters, none of which adversely affect the conditionality,
enforceability, termination or availability of the Debt Financing or reduce the Debt Financing below the Required Amount (as defined below), as of the date hereof, there are no side letters or other
agreements, contracts or arrangements related to the funding of the full amount of the
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Debt
Financing other than as expressly set forth in or contemplated by the Debt Financing Commitments. The Parent Parties have fully paid (or caused to be paid) any and all commitment fees and other
amounts that are due and payable on or prior to the date of this Agreement in connection with the Debt Financing.
(c) Assuming
the satisfaction of the conditions set forth in
Section 6.1
and
Section 6.3
(other than those conditions that by their nature are to be satisfied
at the Closing, but subject to the satisfaction or waiver of
those conditions at the Closing), and assuming the aggregate proceeds to be funded in accordance with the Debt Financing Commitments on the Closing Date have been funded, the Parent Parties will have
at the Closing sufficient funds (together with the cash on hand at the Parent Parties and their subsidiaries and cash on hand at the Company and its subsidiaries) to pay and satisfy (or to provide to
Merger Sub so it can pay and satisfy) in full in cash the aggregate Merger Consideration and to perform its obligations under this Agreement with respect to the transactions contemplated by this
Agreement, including the treatment of Company Equity Awards, and all payments, fees and expenses payable by Parent and the Parent Parties related to or arising out of the consummation of the
transactions contemplated by this Agreement (collectively, the "
Required Amount
").
(d) In
no event shall the receipt or availability of any funds or financing by Parent or any Affiliate thereof or any other financing or other transactions be a condition to
any of Parent's or Merger Sub's obligations hereunder.
Section 4.6
Capitalization of Merger Sub
. The authorized capital stock of Merger
Sub consists of one hundred (100) common shares, par value $0.01 per share, of which one hundred (100) shares are validly issued and outstanding. All of the issued and outstanding
capital shares of Merger Sub are, and at the Effective Time will be, owned by Parent. Merger Sub does not have outstanding any option, warrant, right or any other agreement pursuant to which any
Person other than Parent may acquire any equity security of Merger Sub. Merger Sub has not conducted any business prior to the date hereof and has, and prior to the Effective Time will have, no
assets, liabilities or obligations of any nature other than those incident to its formation and pursuant to this Agreement and the Merger and the other transactions contemplated by this Agreement.
Section 4.7
No Vote of Parent Shareholders
. No vote of the shareholders of Parent
or the holders of any other securities of Parent (equity or otherwise) is required by any applicable Law, the certificate of incorporation or bylaws or other equivalent organizational documents of
Parent or the applicable rules of any exchange on which securities of Parent are traded, in order for Parent to consummate the transactions contemplated hereby.
Section 4.8
Finders or Brokers
. Neither Parent nor any of its Subsidiaries
(including Merger Sub) has employed any investment banker, broker or finder in connection with the transactions contemplated by this Agreement who might be entitled to any fee or any commission in
connection with or upon consummation of the Merger.
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Section 4.9
No Additional Representations
.
(a) Each
of Parent and Merger Sub acknowledges and agrees that it and its Representatives have received access to such books and records, facilities, equipment, contracts
and other assets of the Company that it and its Representatives have desired or requested to review and that it and its Representatives have had full opportunity to meet with the management of the
Company and to discuss the business and assets of the Company.
(b) Parent
and Merger Sub agree and acknowledge that, except for the representations and warranties contained in
Article 3
, neither the Company nor any other Person makes any other express or implied
representation or warranty on behalf of the Company or any
of its Affiliates. Parent and Merger Sub agree and acknowledge that neither the Company nor any Person has made any representation or warranty, express or implied, as to the accuracy or completeness
of any information regarding the Company furnished or made available to Parent and its Representatives, except as expressly set forth in
Article 3
(which includes the Company Disclosure Letter and
the Company SEC Documents, as applicable), and neither the Company, its directors,
officers, employees, agents or other Representatives, nor any other Person, shall be subject to any liability to Parent or any other Person resulting from the Company's making available to Parent or
Parent's use of such information, or any information, documents or material made available to Parent in the due diligence materials provided to Parent, including in the data room, other management
presentations (formal or informal) or in any other form in connection with the transactions contemplated by this Agreement. Without limiting the foregoing, the Company makes no representation or
warranty to Parent or Merger Sub with respect to any business or financial projection, guidance or forecast relating to the Company or any of its Subsidiaries, whether or not included in the data room
or any management presentation. Each of Parent and Merger Sub, on its behalf and on behalf of its Affiliates, expressly waives any such claim relating to the foregoing matters except with respect to
fraud.
Section 4.10
Certain Arrangements
. Other than the Voting Agreement, there are no
contracts, undertakings, commitments, agreements, obligations or understandings, whether written or oral, between Parent or Merger Sub or any of their Affiliates, on the one hand, and any beneficial
owner of more than five percent (5%) of the outstanding Shares of Common Stock or any member of the Company's management or the Board of Directors, on the other hand, relating in any way to the
Company, the transactions contemplated by this Agreement or to the operations of the Surviving Corporation after the Effective Time.
Section 4.11
Ownership of Common Stock
. None of Parent, Merger Sub or any of
their respective Subsidiaries beneficially owns, directly or indirectly (including pursuant to a derivatives contract), any Shares of Common Stock or other securities convertible into, exchangeable
for or exercisable for shares of Common Stock or any securities of any Subsidiary of the Company, and none of Parent, Merger Sub or any of their respective Subsidiaries has any rights to acquire,
directly or indirectly, any Shares of
Common Stock, except pursuant to this Agreement. None of Parent, Merger Sub or any of their "affiliates" or "associates" is, or at any time during the last five years has been, an "interested
shareholder" of the Company, in each case as defined in IBCL 23-1-43.
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Section 4.12
Solvency
. Assuming the accuracy of the representations and
warranties of the Company contained in this Agreement, the satisfaction of the conditions set forth in
Section 6.1
and
Section 6.3
(other than
those conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of
those conditions at the Closing) and the performance by the Company of its obligations under this Agreement, then immediately after giving effect to the consummation of the transactions contemplated
by this Agreement (including the financings being entered into in connection therewith):
(a) the
Fair Value of the assets of Parent and its Subsidiaries, taken as a whole, shall be greater than the total amount of Parent and its Subsidiaries' liabilities
(including all liabilities, whether or not reflected in a balance sheet prepared in accordance with GAAP, and whether direct or indirect, fixed or contingent, secured or unsecured, disputed or
undisputed), taken as a whole;
(b) Parent
and its Subsidiaries, taken as a whole, shall be able to pay their debts and obligations as they become due; and
(c) Parent
and its Subsidiaries, taken as a whole, shall have adequate capital to carry on their businesses.
ARTICLE 5
COVENANTS AND AGREEMENTS
Section 5.1
Conduct of Business by the Company and Parent
.
(a) From
and after the date hereof and prior to earlier of the Effective Time and the date, if any, on which this Agreement is earlier terminated pursuant to
Section 7.1
(the "
Termination Date
"), and except (i) as may be required by applicable Law,
(ii) as may be agreed in writing by Parent (which consent shall not be unreasonably withheld, delayed or conditioned), (iii) as may be expressly contemplated or required by this
Agreement or (iv) as set forth in
Section 5.1
of the Company Disclosure Letter, the Company shall, and shall cause its Subsidiaries to,
(x) conduct its business in all material respects in the ordinary course and (y) use its commercially reasonable efforts to preserve intact in all material respects its business
organization and business relationships and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, creditors, lessors, officers and employees.
(b) From
and after the date hereof and prior to earlier of the Effective Time and the Termination Date, and except (w) as may be required by applicable Law,
(x) as may be agreed in writing by Parent (which consent shall not be unreasonably withheld, delayed or conditioned), (y) as may be expressly required or permitted by this Agreement or
(z) as set forth in
Section 5.1
of the Company Disclosure Letter, the Company:
(i) shall
not, and shall not permit any of its Subsidiaries that is not wholly-owned to, authorize or pay any dividends on or make any distribution with respect to its
outstanding shares of capital stock (whether in cash, assets, stock or other securities of the Company or its Subsidiaries), except dividends and distributions paid by Subsidiaries of the Company to
the Company or to any of its wholly owned Subsidiaries;
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(ii) shall
not, and shall not permit any of its Subsidiaries to, split, combine or reclassify any of its capital stock or issue or authorize or propose the issuance, sale,
pledge, encumbrance or delivery of any other securities in respect of, in lieu of or in substitution for shares of its capital stock;
(iii) except
as required by Company Benefit Plans (as in existence as of the date hereof), shall not, and shall not permit any of its Subsidiaries to (A) increase the
compensation or other benefits payable or
provided to the Company's directors, officers, employees, consultants or service providers, except for annual salary or wage increases for employees of the Company (other than executive officers of
the Company) in the ordinary course of business consistent with past practice, including the timing thereof, not to exceed five percent per employee, (B) grant or pay (or commit to grant or pay
or increase) any severance or termination pay of any current or former director, officer, employee, consultant or service provider, except for any such payments (x) to employees who are not
officers of the Company or its Subsidiaries, (y) made in the ordinary course of business consistent with the terms of the Company's and/or Subsidiary's, as applicable, existing general
severance policies and practices listed in item 16 of
Section 3.9(a)
of the Company Disclosure Letter and (z) made in exchange for
a release of claims against the Company and its Subsidiaries; (C) enter into any employment, change of control, severance or retention agreement with any employee of the Company or any of its
Subsidiaries, except (1) for severance agreements entered into with terminated employees that are consistent with clause (B) above or (2) for agreements with newly hired employees
that are entered into in the ordinary course of business and are terminable on no more than 60 days' notice without penalty); (D) modify any Company Option, Company RSU or other
equity-based award, (E) accelerate the payment or vesting of any payment, equity award or benefit provided or to be provided to any current or former director, officer, employee, consultant or
other service provider or otherwise pay any amounts or provide any benefits not due such individual, (F) become a party to, establish, amend, commence participation in, terminate or commit
itself to the adoption of any stock option plan or other stock-based compensation plan, compensation (except as permitted under clause (A) hereof), pension, retirement, profit-sharing, welfare
benefit, or other employee benefit plan or agreement with or for the benefit of any current or former director, officer, employee, consultant or service provider, or any collective bargaining, works
council or similar labor-related agreement; or (G) hire any new employee having a title of Vice President or above, appoint any new member to the Company's Board of Directors, or terminate the
employment of any employee having a title of Vice President or above, other than a termination for cause, or take any action that would result in such employee having the right to terminate for "Good
Reason" pursuant to any agreement or arrangement with the Company;
(iv) shall
not, and shall not permit any of its Subsidiaries to, enter into or make any loans to any of its present or former directors, employees, agents or consultants or
make any change in its existing borrowing or lending arrangements for or on behalf of any of such Persons, except as required by the terms of any Company Benefit Plan;
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(v) shall
not, and shall not permit any of its Subsidiaries to, change financial accounting policies or procedures or any of its methods of reporting income, deductions or
other material items for financial accounting purposes, except as required by GAAP or SEC rule or policy;
(vi) except
as required by applicable Law or the rules or requirements of any stock exchange, shall not, and shall not permit any of its Subsidiaries to adopt any amendments
to its articles of incorporation or bylaws (or comparable organizational documents);
(vii) except
for transactions among the Company and its Subsidiaries or among the Company's Subsidiaries, shall not, and shall not permit any of its Subsidiaries to, issue,
sell, pledge, dispose of or encumber, or authorize the issuance, sale, pledge, disposition or encumbrance of, any shares of its capital stock or other ownership interests in the Company or any
Subsidiaries or any securities convertible into, exercisable for or exchangeable for any such shares or ownership interests or take any action to cause to be vested any otherwise unvested Company
Equity Award (except as otherwise expressly provided by
Section 2.3
hereof), other than (A) issuances of Shares in respect of any exercise
of or settlement of Company Equity Awards outstanding on the date hereof or as may be granted after the date hereof as permitted under this
Section 5.1(b)
and (B) the acquisition of Shares
from a holder of a Company Equity Award in satisfaction of withholding obligations or in
payment of the exercise price in accordance with the terms of the applicable Company Equity Award as of the date hereof;
(viii) except
for transactions among the Company and its Subsidiaries or among the Company's Subsidiaries, shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, purchase, repurchase, redeem or otherwise acquire any shares of its capital stock or any rights, warrants or options to acquire any such shares;
(ix) shall
not, and shall not permit any of its Subsidiaries to, (A) make any loans, advances or capital contributions to or investments in any other Person except
loans and advances made in the ordinary course of business consistent with past practice or among the Company and its Subsidiaries or among the Company's Subsidiaries, (B) incur, assume,
guarantee, prepay or otherwise become liable for any indebtedness for borrowed money (directly, contingently or otherwise), other than (1) any indebtedness for borrowed money among the Company
and its Subsidiaries or among the Company's Subsidiaries, and (2) guarantees by the Company of indebtedness for borrowed money of Subsidiaries of the Company, which indebtedness is incurred in
compliance with this
Section 5.1(b)
, or (3) other indebtedness for borrowed money not to exceed $1 million in aggregate principal
amount outstanding at any time incurred by the Company or any of its Subsidiaries other than in accordance with clauses (1) and (2);
(x) except
for sales of goods in the ordinary course of business, shall not permit any of its Subsidiaries to, sell, lease, license, transfer, exchange or swap, pledge,
mortgage or otherwise encumber (including securitizations), or subject to any Lien (other than Permitted Liens) or otherwise dispose of any portion of its properties or assets, including the capital
stock of Subsidiaries, other than sales of obsolete equipment in the ordinary course and other ordinary course transactions with an aggregate value of less than $100,000 individually or
$1 million in the aggregate;
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(xi) shall
not, and shall not permit any of its Subsidiaries to enter into (other than with respect to ordinary course customer contracts entered into after the date
hereof), modify, amend, terminate or waive any rights under any Company Material Contract or any Contract entered into after the date hereof that would constitute a Company Material Contract if
entered into prior to the date hereof (other than the expiration or renewal of any Company Material Contract in accordance with its terms);
(xii) except
in the ordinary course of business consistent with past practice, shall not, and shall not permit any of its Subsidiaries to, (A) make, change or revoke
any material Tax election, (B) file any amended Tax Return with respect to any material Tax, (C) make a material change in any method of Tax accounting, (D) settle or compromise
any material Tax proceeding or consent to any extension or waiver of the limitation period applicable to any audit, assessment or claim for material Taxes, or (E) surrender any claim for a
refund of material Taxes;
(xiii) shall
not, and shall not permit any of its Subsidiaries to, settle, pay, discharge or satisfy any Action, other than any Action that involves only the payment of
monetary damages not in excess of $100,000 individually or $1 million in the aggregate;
(xiv) shall
not, and shall not permit any of its Subsidiaries to, adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring,
recapitalization or other reorganization of the Company or any of its Subsidiaries (other than the Merger);
(xv) shall
not, and shall not permit any of its Subsidiaries to, incur or commit to incur any capital expenditures, or any obligations or liabilities in connection therewith
that, individually or in the aggregate, are in excess of $1,000,000, other than any capital expenditure (or series of related capital expenditures) consistent in all material respects with the
Company's annual capital expenditure budget for periods following the date of this Agreement, as provided to Parent;
(xvi) shall
not, and shall not permit any of its Subsidiaries to, acquire (by merger, consolidation or acquisition of stock or assets) any assets (other than those used in
the ordinary course of business), any other Person or any equity interest therein, in each case, with an aggregate value of more than $100,000 individually or $1 million in the aggregate;
(xvii) shall
not, and shall not permit any of its Subsidiaries to, take any action that would cause the Shares to no longer be a "covered security" as defined in
Section 18(b)(1)(A) of the Securities Act;
(xviii) shall
not, and shall not permit any of its Subsidiaries to, take any action to modify, amend, terminate or waive any rights under the Capped Call Transactions;
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(xix) shall
not, and shall not permit any of its Subsidiaries to, take any action that would result in an anti-dilution event under the Convertible Notes;
provided
, that this clause (xix) shall not affect the
Company's rights in connection with a Superior Proposal); and
(xx) shall
not, and shall not permit any of its Subsidiaries to authorize or agree, in writing or otherwise, to take any of the foregoing actions.
(c) Between
the date hereof and the earlier of the Effective Time and the Termination Date, Parent and Merger Sub shall not, and shall not permit any of their Subsidiaries
or Affiliates to, enter into agreements with respect to, or consummate, any acquisitions, mergers, consolidations or business combinations that would reasonably be expected to prevent or materially
delay, impede or interfere with its performance of, or the consummation of the transactions contemplated by, this Agreement.
Section 5.2
Access
.
(a) Subject
to compliance with applicable Laws, the Company shall afford to Parent and to its officers, employees, accountants, consultants, legal counsel, financial
advisors and agents and other representatives (collectively, "
Representatives
") reasonable access during normal business hours, upon reasonable advance
notice, throughout the period prior to the earlier of the Effective Time and the Termination Date, to the Company's and its Subsidiaries' properties, contracts, commitments, books and records, other
than any such matters that relate to the negotiation and execution of this Agreement, including the Company's process of considering potential strategic alternatives leading up to the execution of
this Agreement or otherwise with respect to the consideration or valuation of the Merger or any actual or potential financial or strategic alternatives thereto, or any Alternative Proposal or Superior
Proposal. The foregoing notwithstanding, the Company shall not be required to afford such access if it would unreasonably disrupt the operations of the Company or any of its Subsidiaries, would cause
a violation of any agreement to which the Company or any of its Subsidiaries is a party (provided that the Company shall use commercially reasonable efforts to obtain the consent of such third Person
to such agreement), would cause a risk of a loss of privilege or trade secret protection to the Company or any of its Subsidiaries or would constitute a violation of any applicable Law.
(b) Parent
hereby agrees that all information provided to it or any Parent Representatives in connection with this Agreement and the consummation of the transactions
contemplated hereby shall be deemed to be Evaluation Material, as such term is used in, and shall be treated in accordance with, the confidentiality agreement, dated as of July 5, 2016, between
the Company and Greeneden U.S. Holdings II, LLC (the "
Confidentiality Agreement
").
Section 5.3
No Solicitation
.
(a) Subject
to the provisions of this
Section 5.3
, from the date hereof until the earlier of the Effective Time and
the Termination Date, the Company agrees that it shall not, and shall cause its Subsidiaries not to, and shall use its reasonable best efforts to cause its Affiliates and Representatives not to,
directly or indirectly, (i) solicit, initiate, cooperate with, knowingly facilitate or knowingly induce the making of any submission or announcement of an Alternative Proposal or the making of
any
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inquiry,
offer or proposal that would reasonably be expected to lead to any Alternative Proposal, (ii) participate or engage in any discussions or negotiations regarding an Alternative Proposal
with, or furnish any nonpublic information regarding an Alternative Proposal to, any Person that has made or, to the Knowledge of the Company, is considering making an Alternative Proposal (except, in
each case, solely to notify such Person of the existence of the provisions of this
Section 5.3
), (iii) approve, endorse or recommend an
Alternative Proposal, (iv) terminate, amend, release, modify or fail to enforce any provision of, or grant any permission, waiver or request under, any confidentiality agreement entered into by
the Company in respect of or in contemplation of an Alternative Proposal, (v) take any action to make the provisions of any takeover laws inapplicable to any Alternative Proposal,
(vi) enter into any letter of intent or agreement in principle or any agreement providing for any Alternative Proposal (except for confidentiality agreements permitted under
Section 5.3(b)
) or
(vii) publicly propose to do any of the foregoing.
(b) Notwithstanding
anything in this
Section 5.3
to the contrary, at any time prior to obtaining the Company
Shareholder Approval, if the Company receives an Alternative Proposal that was not solicited in violation of
Section 5.3(a)
and that either
constitutes, or that the Board of Directors of the Company determines in good faith after consultation with outside legal and financial advisors would reasonably be expected to result in, a Superior
Proposal, the Company may take the following actions: (x) furnish nonpublic information to the third party making such Alternative Proposal, if, prior to so furnishing such information, the
third party has entered into an executed confidentiality agreement with the Company having provisions as to confidential treatment of information that are not materially less favorable to the Company
than the confidentiality provisions of the Confidentiality Agreement, and (y) engage in discussions or negotiations with the third party with respect to the Alternative Proposal;
provided
that
(i) the Company shall notify Parent orally (and then in writing within twenty-four (24) hours) of any inquiry made to the
Company with respect to, or which would reasonably be expected to lead to, any Alternative Proposal, the identity of the Person or group making any such Alternative Proposal, request or inquiry, the
terms and conditions of such Alternative Proposal, request or inquiry, copies of all written documents, requests or inquiries relating to any Alternative Proposal (including the financing thereof),
and (ii) contemporaneously with furnishing any non-public information to such third party (and/or its Representatives), the Company shall furnish or make available such non-public information
to Parent or its Representatives (to the extent such information has not been previously furnished to Parent). The Company hereby acknowledges and agrees that any material violation of the
restrictions set forth in this Section 5.3 by any Subsidiary of the Company or any Representative of the Company of any of its Subsidiaries shall be deemed to be a breach of this
Section 5.3 by the Company.
(c) Except
as set forth in this
Section 5.3
, the Board of Directors of the Company shall not (i) fail to make,
withdraw, qualify (or modify in any manner adverse to Parent), or propose publicly to withdraw, qualify (or modify in any manner adverse to Parent), the Recommendation, (ii) approve, recommend
or declare advisable any Alternative Proposal or propose publicly to approve, recommend or declare advisable any Alternative Proposal, (iii) take any formal action or make any recommendation or
public statement in connection with a tender offer or exchange offer other than a recommendation against such offer or a temporary "stop, look and listen" communication by the Board of Directors of
the Company pursuant to Rule 14d-9(f) of the Exchange Act, or (iv) enter into any agreement, contract or agreement in principle requiring the Company to abandon, terminate or
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breach
its obligations hereunder or fail to consummate the Merger (any such action, a "
Change of Recommendation
"). Anything to the contrary set forth in
this Agreement notwithstanding, prior to obtaining the Company Shareholder Approval, the Board of Directors of the Company may, in response to a Superior Proposal received by the Company after the
date of this Agreement on an unsolicited basis, (x) make a Change of Recommendation or (y) cause the Company to terminate this Agreement pursuant to
Section 7.1(g)
(provided that prior to
or simultaneously with such termination the Company shall have entered into a definitive agreement with
respect to such Superior Proposal and paid the Company Termination Fee) solely in the event that:
(i) the
Board of Directors of the Company has received a Superior Proposal after the date of this Agreement;
(ii) the
Company shall have given Parent at least five Business Days' written notice (a "
Superior Proposal Notice
") advising
Parent of its intention to make such a Change of Recommendation or terminate this Agreement (the "
Superior Proposal Notice Period
"), which Superior
Proposal Notice shall include all material terms and conditions of the Superior Proposal that is the basis for the proposed action of the Board of Directors of the Company, the identity of the Person
making the Superior Proposal and a copy of the most current version of the proposed definitive agreement for such Superior Proposal;
(iii) if
requested by Parent, during the Superior Proposal Notice Period, the Company shall have met and negotiated with Parent regarding modifications to the terms and
conditions of this Agreement so that such Superior Proposal ceases to be a Superior Proposal;
(iv) at
the end of such Superior Proposal Notice Period, after taking into account any binding commitments made by Parent to amend the terms of this Agreement during the
period following delivery of such Superior Proposal Notice, the Board of Directors of the Company concludes that the Superior Proposal giving rise to the Superior Proposal Notice continues to
constitute a Superior Proposal;
provided
that (x) any material modifications to the terms of the Superior Proposal shall commence a new Superior
Proposal Notice Period under clause (ii) of three Business Days; and
(v) the
Board of Directors of the Company determines (after consultation with its outside legal counsel and after considering any counter-offer or proposal made by Parent
pursuant to clause (iv) above), that, in light of such Superior Proposal, the failure to terminate this Agreement or effect a Change of Recommendation would reasonably be expected to be
inconsistent with its fiduciary duties under applicable Law;
(d) Nothing
contained in this Agreement shall prohibit the Company or its Board of Directors from (i) disclosing to its shareholders a position contemplated by
Rules 14d-9 and 14e-2(a) promulgated under the Exchange Act, if the Board of Directors of the Company determines in good faith, after consultation with the Company's outside legal counsel, that
the failure of the Board of Directors of the Company to make such disclosure would be inconsistent with the directors'
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exercise
of their fiduciary duties under applicable Law, or from issuing a "stop, look and listen" statement pending disclosure of its position thereunder (provided, however, that any disclosure other
than a "stop, look and listen" disclosure or similar communication of the type contemplated by Rule 14d-9(f) under the Exchange Act, an express rejection of an applicable Alternative Proposal
or an express reaffirmation of the Recommendation shall be deemed to be a Change of Recommendation) or (ii) making any disclosure to its shareholders if the Board of Directors of the Company
determines in good faith, after consultation with the Company's outside legal counsel, that the failure of the Board of Directors of the Company to make such disclosure would be reasonably likely to
be inconsistent with the directors' exercise of their fiduciary obligations to the Company's shareholders under applicable Law. In the event that, subsequent to the date hereof and prior to the
Company Meeting, there shall have been a Change of Recommendation as contemplated by Section 5.3(c) and this Agreement has not been terminated, the Company shall nevertheless submit this
Agreement to the shareholders of the Company for adoption and approval at the Company Meeting.
(e) "
Alternative Proposal
" means any
bona fide
inquiry, proposal, indication
of interest or offer made by any Person relating to (i) a merger, reorganization, share exchange, consolidation, business combination, recapitalization or similar transaction or series of
related transactions involving the Company, (ii) the acquisition by any Person, directly or indirectly, of twenty percent (20%) or more of the assets of the Company and its Subsidiaries, on a
consolidated basis, or (iii) the acquisition by any Person, directly or indirectly, of twenty percent (20%) or more of the outstanding Shares of Common Stock or any tender offer (including a
self-tender offer) or exchange offer that, if consummated, would result in a Person beneficially owning twenty percent (20%) or more of the outstanding Shares of Common Stock.
(f) "
Superior Proposal
" means a written Alternative Proposal, substituting in the definition thereof "fifty percent (50%)"
for "twenty percent (20%)" in each place it appears, that (i) was not solicited in violation of this
Section 5.3
, and (ii) the
Board of Directors of the Company determines in good faith, after consultation with the Company's outside financial and legal advisors, and considering such factors as Board of Directors of the
Company considers to be (x) reasonably likely to be consummated in accordance with its terms, taking into account all financial, regulatory, legal and other aspects of the proposal, including,
to the extent debt financing is required, the likelihood of obtaining necessary financing, the identity of the Person making such Alternative Proposal, and whether such proposal is fully financed by
means of an executed customary commitment letter from a reputable Person that has agreed to provide or cause to be provided the amounts set forth therein, and (y) if completed, would be more
favorable to the Company's shareholders from a financial point of view than the transactions contemplated by this Agreement (after giving effect to any adjustments to the terms and provisions of this
Agreement agreed to in writing by Parent in response to such Alternative Proposal).
Section 5.4
Filings; Other Actions
.
(a) The
Company shall prepare (in consultation with Parent) and file with the SEC the Proxy Statement, which shall, subject to
Section 5.3
, include the Recommendation, and shall use reasonable best efforts
to respond to any comments by the SEC staff in respect of the
Proxy Statement as
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promptly
as reasonably practicable after the receipt thereof, and shall cause the definitive Proxy Statement to be mailed to the Company's shareholders as promptly as reasonably practicable following
the filing thereof with the SEC. Parent and Merger Sub shall provide to the Company such information concerning themselves and their Affiliates as is customarily included in a proxy statement prepared
in connection with a transaction of the type contemplated by this Agreement or as otherwise required by Law, requested by the SEC or its staff or as the Company may reasonably request and the Company
shall provide Parent an opportunity to review and comment on the Proxy Statement prior to filing or mailing the Proxy Statement and shall consider in good faith any comments reasonably proposed by
Parent.
(b) The
Company and its Affiliates, on the one hand, and Parent, Merger Sub and their respective Affiliates, on the other hand, may not communicate in writing with the SEC
or its staff with respect to the Proxy Statement, as the case may be, without providing the other a reasonable opportunity to review and comment on such written communication which comments shall be
considered by the filing party in good faith.
(c) The
Company, on the one hand, and Parent and Merger Sub, on the other hand, will advise the other, promptly after it receives notice thereof, of any receipt of a request
by the SEC or its staff for (A) any amendment or revisions to the Proxy Statement, as the case may be, (B) any receipt of comments from the SEC or its staff on the Proxy Statement, as
the case may be, or (C) any receipt of a request by the SEC or its staff for additional information in connection therewith.
(d) Subject
to the other provisions of this Agreement and as promptly as reasonably practicable following the date of this Agreement, the Company shall (i) take all
action required by the IBCL and its articles of incorporation and bylaws to duly call, give notice of, convene and hold a meeting of its shareholders after the Proxy Statement is cleared by the SEC
for mailing to the Company's shareholders for the purpose of obtaining the Company Shareholder Approval (the "
Company Meeting
"), and (ii) subject
to a Change of Recommendation in accordance with
Section 5.3
, use reasonable best efforts to solicit from its shareholders proxies in favor of
the approval of the adoption of this Agreement.
Section 5.5
Employee Matters
.
(a) For
the period of six months after the Effective Time, Parent shall provide, or shall cause to be provided, to Company employees who continue to be employed by the
Surviving Corporation or its Subsidiaries after the Effective Time ("
Company Employees
") (i) base salary or wages that are no less favorable than
was provided to the Company Employee immediately before the Effective Time and (ii) all other compensation and benefits (excluding stock based benefits, if any) that, in the aggregate, are no
less favorable than those provided to similarly situated employees of Parent and its Subsidiaries;
provided
, that until such time as Parent or the
Surviving Corporation shall cause Company Employees to participate in a New Plan (as defined below), a Company Employee's continued participation in the applicable Company Benefit Plan shall be deemed
to satisfy the foregoing provisions of this clause (ii) (it being understood that participation in the applicable New Plans may commence at different times with respect to each Company Benefit
Plan). Notwithstanding any other provision of this Agreement to the contrary, Parent shall or shall cause the Surviving Corporation to provide to each Company
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Employee
whose employment is terminated in a severance qualifying termination (as determined in accordance with the applicable Company Benefit Plan) during the six-month period following the Effective
Time severance benefits at the same level as the severance benefits that the Company Employee would have been entitled under the Company Benefit Plans had the Company Employee's
employment been terminated in a severance qualifying termination immediately prior to the Effective Time.
(b) For
all purposes (including purposes of vesting, eligibility to participate and level of benefits) under the employee benefit plans of Parent and its Subsidiaries
providing benefits to any Company Employees after the Effective Time (the "
New Plans
"), each Company Employee shall be credited with his or her years of
service with the Company and its Subsidiaries and their respective predecessors before the Effective Time, to the same extent as such Company Employee was entitled, before the Effective Time, to
credit for such service under any similar Company Benefit Plan in which such Company Employee participated or was eligible to participate immediately prior to the Effective Time;
provided
, that the
foregoing shall not apply to the extent that its application would result in a duplication of benefits. In addition, and without
limiting the generality of the foregoing, (i) each Company Employee shall be immediately eligible to participate, without any waiting time, in any and all New Plans to the extent coverage under
such New Plan is comparable to a Company Benefit Plan in which such Company Employee participated immediately before the Effective Time (such plans, collectively, the "
Old
Plans
"), and (ii) for purposes of each New Plan providing medical, dental, pharmaceutical and/or vision benefits to any Company Employee, Parent shall cause all
pre-existing condition exclusions and actively-at-work requirements of such New Plan to be waived for such employee and his or her covered dependents, unless such conditions would not have been waived
under the comparable plans of the Company or its Subsidiaries in which such employee participated immediately prior to the Effective Time, and Parent shall cause any eligible expenses incurred by such
employee and his or her covered dependents during the portion of the plan year of the Old Plans ending on the date such employee's participation in the corresponding New Plan begins to be taken into
account under such New Plan for purposes of satisfying all deductible, coinsurance and maximum out-of-pocket requirements applicable to such employee and his or her covered dependents for the
applicable plan year as if such amounts had been paid in accordance with such New Plan.
(c) Parent
hereby acknowledges that a "change of control" (or similar phrase) within the meaning of the Company Benefit Plans will occur at or prior to the Effective Time,
as applicable.
(d) The
Company may implement a retention program in accordance with
Section 5.5(d)
of the Company Disclosure Letter.
(e) With
respect to Company Employees who are eligible to receive a cash bonus ("
Annual Bonus Plan Participant
") pursuant to
the Company annual bonus plans for 2016 that are in effect as of the date hereof, the Company shall be permitted to (and if the Effective Time occurs before the payment of such bonus, Parent shall, or
shall cause the Surviving Corporation to) pay to each Annual Bonus Plan Participant his or her annual cash bonus for 2016 based on actual performance through December 31, 2016 in accordance
with the terms of the applicable Company bonus plans, with any earned payments to be made to Annual Bonus Plan Participants at the same time after the end of
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the
year as payments have customarily been made by the Company pursuant to the terms of the applicable Company bonus plans. After the Effective Time, if an Annual Bonus Plan Participant's employment
is terminated by Parent or the Surviving Corporation other than for "cause" (as customarily defined by the Parent) prior to the payment of the earned annual bonus for 2016, such Annual Bonus Plan
Participant shall be entitled to a prorated payment of the actual earned bonus based on the number of days in 2016 that such Annual Bonus Plan Participant was employed by the Company and by Parent and
the Surviving Corporation, with the payment to be made at the same time as payments are made pursuant to the applicable annual bonus plan for employees who remain employed through the payment date.
(f) As
soon as reasonably practicable following the date hereof (and in any event prior to the Closing Date), the Company shall, or shall cause its applicable Subsidiary to,
take all actions necessary to fulfill all consultation and notification requirements, and obtain all approvals from, any works councils or other labor organizations, whether required pursuant to
applicable Law or otherwise.
(g) If
requested by Parent in writing no later than fifteen (15) days prior to the Closing Date, the Board of Directors of the Company (or the appropriate committee
thereof) shall adopt resolutions and take all actions that are necessary to terminate the Company's 401(k) plan (the "
Company 401(k) Plan
") effective as
of the day prior to the Closing Date. Prior to the Closing Date, the Company shall provide Parent with a copy of the resolutions and/or plan amendments evidencing that the Company 401(k) Plan has been
terminated in accordance with its terms.
(h) Without
limiting the generality of
Section 8.10
, the provisions of this
Section 5.5
are solely for the benefit of the parties to this Agreement, and no
current or former director, employee or consultant or any other
person shall be a third-party beneficiary of this Agreement, and nothing herein shall be construed as an amendment to any Company Benefit Plan or other compensation or benefit plan or arrangement for
any purpose. Nothing in this Section 5.5 express or implied, shall confer upon any Company Employee, or legal representative or beneficiary thereof or other Person, any rights or remedies,
including any right to employment or continued employment for any specified period, or a right in any employee or beneficiary of such employee or other Person under a Company Benefit Plan that such
employee or beneficiary or other Person would not otherwise have under the terms of that Company Benefit Plan.
Section 5.6
Efforts
.
(a) Each
of the parties hereto shall use all reasonable best efforts to take promptly, or cause to be taken, all actions, and to do promptly, or cause to be done, and to
assist and cooperate with the other parties in doing, all things necessary, proper or advisable under applicable Laws to consummate and make effective the Merger and the other transactions
contemplated by this Agreement as promptly as practicable after the date hereof and in any event prior to the End Date, including (i) the obtaining of all necessary actions or nonactions,
waivers, consents, clearances, approvals, orders, non-objections and expirations or terminations of waiting periods, including the Specified Approvals and the Parent Approvals, from Governmental
Entities and the making of all necessary registrations and filings
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and
the taking of all steps as may be necessary to obtain an approval, clearance or waiver from, or to avoid an action or proceeding by, any Governmental Entity, (ii) the obtaining of all
necessary consents, approvals, non-objections or waivers from third parties, (iii) the defending of any Actions, lawsuits or other legal proceedings, whether judicial or administrative,
challenging this Agreement or the consummation of the Merger or the other transactions contemplated by this Agreement and (iv) the execution and delivery of any additional instruments necessary
to consummate the transactions contemplated by this Agreement;
provided
,
however
, that in no event shall
the Company or any of its Subsidiaries be required to pay prior to the Effective Time any fee, penalty or other consideration to any third party for any consent or approval required for or triggered
by this Agreement or the consummation of the transactions contemplated hereby under any contract or agreement or otherwise.
(b) None
of the Company, Parent, or Merger Sub shall unilaterally and voluntarily approach CFIUS with respect to the Merger or the other transactions contemplated by this
Agreement. In the event that any party receives a request from CFIUS to file a notification with respect to the transaction ("
CFIUS Request
"),
the party receiving such request must promptly provide written notice or request to all other parties.
(c) Subject
to the terms and conditions herein provided and without limiting the foregoing, the Company, Parent and Merger Sub shall (i) promptly, but in no event
later than 10 Business Days after the date hereof, file any and all required notification and report forms under the HSR Act with respect to the Merger and the other transactions contemplated by this
Agreement, and use all reasonable best efforts to cause the expiration or termination of any applicable waiting periods under the HSR Act, (ii) if a CFIUS Request has occurred, promptly, but in
no event later than 15 Business Days after the date of the CFIUS Request, file a joint voluntary notice with CFIUS with respect to the Merger and the other transactions contemplated by this
Agreement, (iii) use all reasonable best efforts to cooperate with each other in promptly making any other filings required to be made with, or timely obtaining all such consents, permits,
authorizations, waivers, clearances, approvals, and expirations or terminations of waiting periods required to be obtained from, any third parties or Governmental Entities in connection with the
execution and delivery of this Agreement and the consummation of the transactions contemplated hereby, (iv) supply to any Governmental Entity as promptly as practicable any additional
information or documents that may be requested pursuant to any Law or by such Governmental Entity and (v) take, or cause to be taken, all other actions and do, or cause to be done, all other
things necessary, proper or advisable to consummate and make effective the transactions contemplated hereby, including taking all such further action as may be necessary to resolve such objections, if
any, as the United States Federal Trade Commission, the Antitrust Division of the United States Department of Justice, state antitrust enforcement authorities, competition authorities of any other
nation or other jurisdiction, CFIUS (if applicable), or any other Person may assert under any Antitrust Law or Exon-Florio (if applicable) with respect to the transactions contemplated hereby, and to
avoid or eliminate each and every impediment under any Antitrust Law or Exon-Florio (if applicable) that may be asserted by any Governmental Entity with respect to the Merger so as to enable the
Closing to occur as promptly as practicable after the date hereof (and in any event no later than the End Date), including (x) proposing, negotiating, committing to and effecting, by consent
decree, hold separate order or otherwise, the sale, divestiture, license, hold separate or disposition of any assets or businesses of
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Parent
or its Subsidiaries or Affiliates or of the Company or its Subsidiaries and (y) otherwise taking or committing to take any actions that after the Closing Date would limit Parent's or its
Subsidiaries' (including the Surviving Corporation's) or Affiliates' freedom of action with respect to, or its ability to retain, one or more of its or its Subsidiaries' (including the Surviving
Corporation's) businesses, product lines or assets, in each case as may be required in order to avoid the entry of, or to effect the dissolution of, any injunction, temporary restraining order or
other order in any Action that would otherwise have the effect of preventing the Closing, delaying the Closing or delaying the Closing beyond the End Date;
provided
that neither Parent, the Company nor
any of their respective Subsidiaries shall be required to become subject to, or consent or agree to or
otherwise take any action with respect to, any requirement, condition, understanding, agreement or order to sell, divest, license, hold separate or otherwise dispose of, or to conduct, restrict,
operate, invest or otherwise change the assets, operations or business of Parent, the Company or any of their respective Subsidiaries or Affiliates, unless such requirement, condition, understanding,
agreement or order is conditioned upon the Closing.
(d) Notwithstanding
anything in this Agreement to the contrary, Parent and its Subsidiaries and Affiliates shall not be required to, and the Company and its Subsidiaries
shall not be required to and, without the prior written consent of Parent shall not, take any action, or agree to any condition or limitation contemplated in this
Section 5.6
, that would, or would
reasonably be expected to, have a material adverse effect on (i) the business, results or operations,
EBITDA, or financial condition of either (x) Parent and its Subsidiaries or (y) the Company and its Subsidiaries (in each case of (x) and (y), measured on a scale relative to the
Company and its Subsidiaries, taken as a whole) or (ii) the benefits or advantages Parent expects to receive from the Merger and the other transactions contemplated by this Agreement.
(e) The
Company, Parent and Merger Sub shall cooperate and consult with each other in connection with the making of all registrations, filings, notifications,
communications, submissions and any other actions contemplated by
Section 5.4
or this
Section 5.6
, and, subject to applicable legal limitations
and the instructions of any Governmental Entity, the Company, on the one hand, and
Parent and Merger Sub, on the other hand, shall keep each other apprised of the status of matters relating to the completion of the transactions contemplated thereby, including promptly furnishing the
other with copies of any notices or other communications received by the Company or Parent, as the case may be, or any of their respective Subsidiaries or Affiliates, from any third party and/or any
Governmental Entity with respect to such transactions. Subject to applicable Law relating to the exchange of information, the Company, on the one hand, and Parent and Merger Sub, on the other hand,
shall permit counsel for the other party reasonable opportunity to review in advance, and consider in good faith the views of the other party in connection with, any proposed notifications or filings
and any written or oral communications or submissions, and with respect to any such notification, filing, written communication or submission, any documents submitted therewith to any Governmental
Entity;
provided
,
however
, that materials may be redacted (x) to remove references concerning the
valuation of the businesses of the Company and its Subsidiaries, or proposals from third parties with respect thereto, (y) as necessary to comply with contractual agreements and (z) as
necessary to address reasonable privilege or confidentiality concerns. Each of the Company, Parent and Merger Sub agrees not to participate in any meeting or discussion, either in person or by
telephone, with any Governmental Entity in connection with the proposed transactions unless it consults with the other party in advance and, to the extent not prohibited by such Governmental Entity,
gives the other party the opportunity to attend and participate.
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(f) In
furtherance and not in limitation of the covenants of the parties contained in this
Section 5.6
, if any
administrative or judicial action or proceeding, including any proceeding by a private party, is instituted (or threatened to be instituted) challenging this Agreement or any transaction contemplated
by this Agreement as violative of any Law, each of the Company, Parent and Merger Sub shall cooperate in all respects with each other and shall use all their respective reasonable best efforts to
contest and resist any such Action or proceeding and to have vacated, lifted, reversed or overturned any Action, decree, judgment, injunction or other order, whether temporary, preliminary or
permanent, that is in effect and that prohibits, prevents or restricts consummation of the Merger and the other transactions contemplated by this Agreement.
Section 5.7
Takeover
Statutes
. For any "fair price," "moratorium," "business combination," "control share acquisition" or other form of antitakeover statute or regulation that is
applicable to the transactions contemplated hereby, each of the Company, Parent and Merger Sub and the members of their respective Boards of Directors shall grant such approvals and take such actions
as are reasonably necessary so that the transactions contemplated hereby may be consummated as promptly as practicable
on the terms contemplated hereby and otherwise act to eliminate or minimize the effects of such statute or regulation on the transactions contemplated hereby, the parties hereto and any Shares.
Section 5.8
Public Announcements
. The Company, Parent and
Merger Sub shall consult with and provide each other a reasonable opportunity to review and comment upon any press release or other public statement or comment prior to the issuance of such press
release or other public statement or comment relating to this Agreement or the transactions contemplated hereby and shall not issue any such press release or other public statement or comment prior to
such consultation, except as may be required by applicable Law or by obligations pursuant to any listing agreement with any national securities exchange or as may be requested by a Governmental
Entity;
provided
that the restrictions in this
Section 5.8
shall not apply to any Company
communication regarding an Alternative Proposal or from and after a Change of Recommendation in compliance with
Section 5.3
. Parent and the
Company agree to issue a joint press release in a form agreed by them as the first public disclosure of this Agreement.
Section 5.9
Indemnification and Insurance
.
(a) Parent
and Merger Sub agree that all rights to exculpation, indemnification and advancement of expenses now existing in favor of the current or former directors,
officers or employees, as the case may be, of the Company or its Subsidiaries as provided in their respective articles of incorporation or bylaws or other organizational documents or in any agreement
shall survive the Merger and shall continue at and after the Effective Time in full force and effect. For a period of six years from the Effective Time, Parent and the Surviving Corporation shall
maintain in effect the exculpation, indemnification and advancement of expenses provisions of the Company's and any Company Subsidiary's articles of incorporation and bylaws or similar organizational
documents as in effect immediately prior to the Effective Time or in any indemnification agreements of the Company or its Subsidiaries with any of their respective directors, officers or employees as
in effect immediately
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prior
to the Effective Time, and shall not amend, repeal or otherwise modify any such provisions in any manner that would adversely affect the rights thereunder of any individuals who at the Effective
Time were current or former directors, officers or employees of the Company or any of its Subsidiaries;
provided
,
however
, that all rights to
indemnification in respect of any Action pending or asserted or any claim made within such period shall continue until the
final disposition of such Action or resolution of
such claim, even if beyond such six-year period. From and after the Effective Time, Parent shall be jointly and severally liable for, and guaranty and stand surety for, and shall cause the Surviving
Corporation and its Subsidiaries to honor, in accordance with their respective terms, each of the covenants contained in this
Section 5.9
.
(b) The
Surviving Corporation shall (and Parent shall cause the Surviving Corporation to), to the fullest extent permitted under applicable Law, indemnify and hold harmless
(and advance funds in respect of each of the foregoing or any related expenses) each current and former director, officer or employee of the Company or any of its Subsidiaries and each Person who
served as a director, officer, member, trustee or fiduciary of another corporation, partnership, joint venture, trust, pension or other employee benefit plan or enterprise at the request of or for the
benefit of the Company or its Subsidiaries (each, together with such Person's heirs, executors or administrators, and successors and assigns, an "
Indemnified
Party
") against any costs or expenses (including advancing attorneys' fees and expenses in advance of the final disposition of any Action to each Indemnified Party to the
fullest extent permitted by Law), judgments, fines, losses, claims, damages, obligations, costs, liabilities and amounts paid in settlement in connection with any actual or threatened claim, action,
suit, proceeding or investigation, whether civil, criminal, administrative or investigative (an "
Action
"), arising out of, relating to or in connection
with any action or omission occurring or alleged to have occurred whether before or after the Effective Time (including acts or omissions in connection with such Persons serving as an officer,
director, employee or other fiduciary in any entity if such service was at the request or for the benefit of the Company or its Subsidiaries). In the event of any such Action, Parent and the Surviving
Corporation shall cooperate with the Indemnified Party in the defense of any such Action.
(c) For
a period of six years from the Effective Time, Parent shall cause to be maintained in effect the current policies of directors' and officers' liability insurance and
fiduciary liability insurance maintained by the Company and its Subsidiaries with respect to matters arising on or before the Effective Time;
provided
,
however
, that after the Effective Time, Parent shall not be required to pay annual premiums in excess of 300% of the last annual premium paid by the
Company prior to the date hereof in respect of the coverage required to be obtained pursuant hereto, but in such case shall purchase as much coverage as reasonably practicable for such amount. In lieu
of the foregoing, at the Company's option, the Company may purchase (subject to reasonable consultation with Parent), prior to the Effective Time, a six-year prepaid "tail" policy on terms and
conditions providing substantially equivalent benefits as the current policies of directors' and officers' liability insurance and fiduciary liability insurance maintained by the Company and its
Subsidiaries with respect to matters arising on or before the Effective Time, covering without limitation the transactions contemplated hereby. If such prepaid "tail" policy has been obtained by the
Company prior to the Effective Time, Parent shall cause such policy to be maintained in full force and effect, for its full term, and cause all obligations
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thereunder
to be honored by the Surviving Corporation, and no other party shall have any further obligation to purchase or pay for insurance hereunder.
(d) Parent
shall pay all reasonable expenses, including reasonable attorneys' fees, that may be incurred by any Indemnified Party in enforcing the indemnity and other
obligations provided in this
Section 5.9
.
(e) The
rights of each Indemnified Party hereunder shall be in addition to, and not in limitation of, any other rights such Indemnified Party may have under the articles of
incorporation or bylaws or other organizational documents of the Company or any of its Subsidiaries or the Surviving Corporation, any other indemnification arrangement, the IBCL or otherwise. The
provisions of this
Section 5.9
shall survive the consummation of the Merger and expressly are intended to benefit, and are enforceable by, each
of the Indemnified Parties.
(f) In
the event that Parent, the Surviving Corporation or any of their respective successors or assigns (i) consolidates with or merges into any other Person and
shall not be the continuing or surviving corporation or entity in such consolidation or merger or (ii) transfers all or substantially all of its properties and assets to any Person, then, and
in either such case, proper provision shall be made so that the successors and assigns of Parent or the Surviving Corporation, as the case may be, shall assume the obligations set forth in this
Section 5.9
.
Section 5.10
Control of Operations
. Nothing contained in
this Agreement shall give Parent or Merger Sub, directly or indirectly, the right to control or direct the Company's operations prior to the Effective Time. Prior to the Effective Time, the Company
shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its operations.
Section 5.11
Rule 16b-3
. Prior to the Effective
Time, the Company shall be permitted to take such steps as may be reasonably necessary or advisable hereto to cause dispositions of Company equity securities (including derivative securities) pursuant
to the transactions contemplated by this Agreement by each individual who is a director or officer of the Company to be exempt under Rule 16b-3 promulgated under the Exchange Act.
Section 5.12
Transaction Litigation.
Prior to the
Effective Time, the Company shall promptly notify Parent of all (i) notices and other communications received by the Company, its Subsidiaries or any of their Affiliates from any Governmental
Entity in connection with the Merger or any other transaction contemplated by this Agreement or from any Person alleging that the consent of such Person is required in connection with the transactions
contemplated by this Agreement, if the subject matter of such communication or the failure of such party to obtain such consent could be material to the
Company, its Subsidiaries or Parent and (ii) Actions commenced or threatened against the Company or any of its Subsidiaries or Affiliates, in each case in connection with, arising from or
otherwise relating to the Merger or any other transaction contemplated by this Agreement ("
Transaction Litigation
") (including by providing copies of
all pleadings with respect thereto) and thereafter keep Parent reasonably informed with respect to the status thereof. The Company shall (a) give Parent the opportunity to participate in the
defense, settlement or prosecution of any Transaction Litigation; and (b) consult with Parent with respect to the defense, settlement and prosecution of any Transaction Litigation and not
settle or compromise any Transaction Litigation
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without
consent of Parent. For purposes of this
Section 5.12
, "participate" means that Parent will be kept apprised of proposed strategy and
other significant decisions with respect to the Transaction Litigation by the Company (to the extent that the attorney-client privilege between the Company and its counsel is not undermined or
otherwise affected).
Section 5.13
FIRPTA
. Prior to the Effective Time, the
Company shall deliver to Parent a certificate, dated as of the Closing Date, substantially in the form provided for in Treasury Regulation Sections 1.1445-2(c)(3) and 1.897-2(h), certifying
that interests in the Company (including the Shares) are not United States real property interests within the meaning of Section 897(c) of the Code.
Section 5.14
Convertible Notes
. The Company shall comply
with its obligations under the Convertible Notes that arise as a result of the execution, delivery or performance by the Company of this Agreement and the consummation of the transactions contemplated
hereby, including the delivery of any notices, certificates and opinions required in connection with the transactions contemplated hereby.
Section 5.15
Repatriation
. The Company and its
Subsidiaries shall use their commercially reasonable efforts (in the manner reasonably requested in writing by Parent) to distribute or transfer or cause to be distributed or transferred, immediately
before Closing (including pursuant to the repayment of outstanding intercompany obligations), unrestricted cash balances held in commercial bank accounts in the name of the Company or such Subsidiary
in any jurisdiction located outside the United States to accounts in the name of the Company or a Subsidiary located in the United States;
provided
,
however
,
the foregoing shall not require the Company to violate any applicable Law or incur any Tax liability with respect to repatriation in advance of the Effective Time unless the conditions to Closing have
been waived or satisfied (other than those conditions that by their terms are to be satisfied or waived at the Closing).
Section 5.16
Parent Financing
.
(a) (i)
Parent and Merger Sub shall use their respective reasonable best efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things
necessary to arrange and consummate the Debt Financing on the terms and conditions described in or contemplated by the Debt Financing Commitments (taking into account any "market flex" provisions in
the related fee letter) or on terms and conditions that are no less favorable in the aggregate to the Parent Parties (as determined by the Parent Parties in good faith) than the terms and conditions
contained in the Debt Financing Commitments (taking into account any "market flex" provisions in the related fee letter), including using reasonable best efforts to (i) maintain in effect the
Debt Financing Commitments, (ii) satisfy (or, if deemed advisable by the Parent Parties, to obtain the waiver of) on a timely basis (taking into account the timing of the Marketing Period) all
conditions to funding in the Debt Financing Commitments that are within the control of the Parent Parties, (iii) negotiate and enter into definitive agreements with respect thereto on terms and
conditions described in the Debt Financing Commitments (taking into account any "market flex" provisions in the related fee letter) at or prior to the Closing on terms and conditions that are no less
favorable in the aggregate to the Parent Parties (as determined by the Parent Parties in good faith) than terms contained in the Debt Financing
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Commitments
(including any "market flex" provisions in the related fee letter);
provided
that, notwithstanding anything to the contrary, the
documentation relating to the bridge loan facilities contemplated by the Debt Financing Commitments shall not be required until reasonably necessary in connection with the funding of the Debt
Financing, (iv) enforce its rights under the Debt Financing Commitments and (v) in the event that all conditions in the Debt Financing Commitments have been satisfied or waived, use
reasonable best efforts to cause the lenders party to the Debt Financing Commitments to fund on the Closing Date the Debt Financing necessary to fund, in part, the Required Amount (which may include
litigation pursued in good faith). To the extent reasonably requested by the Company from time to time, Parent shall keep the Company informed on a reasonably current basis of the status of its
efforts to arrange the Debt Financing (or Alternative Financing) and, upon the reasonable request of the Company, Parent shall provide to the Company copies of the definitive agreements related to the
Debt Financing (or Alternative Financing) for the purpose of monitoring the progress of the financing activities.
(ii) In
the event any portion of the Debt Financing becomes unavailable on the terms and conditions (including after giving effect to the exercise of any "market flex"
provisions in the related fee letter) contemplated by the Debt Financing Commitments for any reason, (A) Parent shall promptly notify the Company in writing and (B) Parent and Merger Sub
shall use, and shall cause their respective subsidiaries to use, their reasonable best efforts to arrange to obtain alternative financing from alternative sources in an amount, when added with the
available portion of the Debt Financing and cash on hand at the Parent Parties and their subsidiaries and cash on hand at the Company and its subsidiaries, sufficient to fund the Required Amount (the
"
Alternative Financing
") as promptly as practicable following the occurrence of such event, on terms and conditions (taking into account any "market
flex" provisions in the related fee letter) that are no less favorable in the aggregate to the Parent Parties (as determined by the Parent Parties in good faith) than the terms and conditions
contained in the Debt Commitment Letter (taking into account any "market flex" provisions in the related fee letter). If applicable, except as otherwise expressly stated, references in this Agreement
to the terms "Debt Financing Commitments" and "Debt Financing" shall include any Alternative Financing.
(iii) Without
limiting the generality of the foregoing, Parent shall promptly notify the Company in writing (A) if a Debt Financing Commitment expires or is
terminated in either case for any reason prior to its stated date of expiration or termination (or if any Person attempts or purports in writing to terminate a Debt Financing Commitment prior to the
stated date of termination, whether or not such attempted or purported early termination is valid), (B) if there exists any material breach, material default, repudiation, cancellation or early
termination by any Lender (or any event or circumstance that, with or without notice, lapse of time or both, could reasonably be expected to give rise to any material breach, material default,
repudiation, cancellation or early termination) of which Parent becomes aware and that would, in any such case, reasonably be expected to adversely affect the timely availability (taking into account
the timing of the Marketing Period) or the amount of the Debt Financing, (C) of the receipt by the Parent Parties or Merger Sub of any written notice or other written communication from any
Lender with respect to any (I) actual material breach, material default, repudiation, cancellation or early termination by such Lender that would, in any such case, reasonably be expected to
adversely affect the timely availability (taking into account the timing of the Marketing Period) or the
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amount
of the Debt Financing or (II) material dispute or disagreement between the Parent Parties and any Lender related to the obligation to fund the Debt Financing or the amount of the Debt
Financing to be funded at Closing (but excluding for the avoidance of doubt, any ordinary course negotiations with respect to the terms of the Debt Financing and/or the definitive agreements with
respect thereto) or (D) if for any reason the Parent Parties or Merger Sub believe in good faith that there is a reasonable possibility that it will not be able to obtain all or any portion of
the Debt Financing
contemplated by the Debt Financing Commitments. As soon as reasonably practicable, Parent shall provide any information reasonably requested by the Company and that is reasonably available to the
Parent Parties relating to any circumstance referred to in clause (A), (B) or (C) of the immediately preceding sentence.
(iv) Parent
Parties shall not (without the prior written consent of the Company) consent or agree to any amendment, replacement, supplement or modification to, or any waiver
of any provision under, the Debt Financing Commitments if such amendment, replacement, supplement, modification or waiver (1) decreases the aggregate amount of the Debt Financing to an amount
that, when combined with cash on hand at the Parent Parties and their subsidiaries and cash on hand at the Company and its subsidiaries, would or would reasonably be expected to be less than the
Required Amount, or (2) imposes new or additional conditions or otherwise expands, amends or modifies any of the conditions to the receipt of the Debt Financing, in the case of this
clause (2), in a manner that would reasonably be expected to (A) prevent, delay or materially impair the consummation of the transactions contemplated by this Agreement, (B) make
the funding of the Debt Financing (or satisfaction of the conditions to obtaining the Debt Financing) less likely to occur, or (C) materially adversely impact the ability of the Parent Parties
to enforce its rights against the Lenders under the Debt Financing Commitments. Notwithstanding anything to the contrary, for the avoidance of doubt, the Parent Parties may amend, replace, supplement
and/or modify the Debt Financing Commitments to add lenders, lead arrangers, bookrunners, syndication agents, commitment parties, purchasers or similar entities as parties thereto who had not executed
the Debt Financing Commitments as of the date hereof. Upon any amendment, supplement, replacement or modification of the Debt Financing Commitments made in compliance with this Section 5.16(a),
Parent shall provide a copy thereof to the Company and the terms "Debt Financing Commitments" and "Debt Financing" shall mean the Debt Financing Commitments and the Debt Financing as so amended,
replaced, supplemented or modified, including any Alternative Financing.
(v) Notwithstanding
the foregoing, compliance by Parent with this Section 5.16(a) shall not relieve Parent or Merger Sub of their obligations to consummate the
transactions contemplated by this Agreement whether or not the Debt Financing is available and each of Parent and Merger Sub acknowledges that this Agreement and the transactions contemplated hereby
are not contingent on Parent's or Merger Sub's ability to obtain the Debt Financing (or any Alternative Financing) or any specific term with respect to such financing.
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(vi) Notwithstanding
anything to the contrary in this Agreement, nothing contained in this Section 5.16(a) shall require, and in no event shall the reasonable best
efforts of Parent and Merger Sub be deemed or construed to require, Parent or Merger Sub to pay any fees or agree to pay any interest
rate amounts, in either case, in excess of those contemplated by the Debt Financing Commitments (taking into account any "market flex" provisions contained in the related fee letter) or to consummate
the Debt Financing prior to the completion of the Marketing Period.
(b) Prior
to the Closing, the Company shall, and shall cause its subsidiaries to and shall use its reasonable best efforts to cause its and their respective officers,
directors and employees to, and shall use its reasonable best efforts to, direct its and their respective accountants, legal counsel and other Representatives to, provide to the Parent Parties and
Merger Sub, at the Parent Parties' sole cost and expense, all customary cooperation as may be reasonably requested by Parent in connection with the arrangement of the Debt Financing (solely for
purposes of this Section 5.11(b), the term "Debt Financing" shall be deemed to include one or more offerings of customary "high yield" non-convertible debt securities to be issued or incurred
in lieu of any bridge facility contemplated by the Debt Financing Commitments or pursuant to any "market flex" or "securities demand" provisions of the related fee letter) contemplated by the Debt
Financing Commitments;
provided
that such requested cooperation does not unreasonably interfere with the ongoing operations of the Company and its
subsidiaries, including:
(i) as
promptly as reasonably practicable, (A) furnishing Parent with the Required Information and such other financial and other pertinent information regarding the
Company and its subsidiaries as may be reasonably requested by Parent or the Lenders to assist in the preparation of any syndication, offering or other similar marketing materials and/or documents
related to the Debt Financing and (B) informing Parent if the Company shall have actual Knowledge of any facts that would likely require the restatement of any financial statements included in
the Required Information for such financial statements to comply with GAAP;
(ii) assisting
the Parent Parties in preparation for, and participating with the Parent Parties in, the marketing efforts for the Debt Financing, including participating
with, and causing senior members of management and Representatives of the Company and its subsidiaries to participate with, the Parent Parties in a reasonable number of lender and investor meetings,
conference calls and presentations, road shows, due diligence sessions (including accounting due diligence sessions), drafting sessions, sessions with rating agencies and other sessions with
prospective lenders, investors and purchasers, in each case in connection with the Debt Financing and all at reasonable times and locations to be mutually agreed upon reasonable advance notice, and
assisting the Parent Parties in obtaining ratings as contemplated by the Debt Financing;
(iii) using
commercially reasonable efforts to obtain customary auditor consents for use of their reports in any syndication, offering or other similar marketing materials
and/or documents relating to the Debt Financing and to obtain customary comfort letters of independent accountants (including customary change of period "negative assurance" comfort), as reasonably
requested by Parent as necessary or customary for financings similar to the Debt Financing (including any offering or private placement of debt securities pursuant to Rule 144A under the
Securities Act);
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(iv) assisting
the Parent Parties in the preparation by the Parent Parties and the Lenders of (A) any offering documents, private placement memoranda, bank
information memoranda (including, to the extent necessary, (x) an additional bank information memorandum that does not include material non-public information and (y) authorization
letters), lender presentations, and similar syndication, offering or other similar marketing materials and/or documents relating to the Debt Financing, including reviewing and commenting on the Parent
Parties' draft of a business description of the Company and its subsidiaries and "Management's Discussion and Analysis" of the Company's and its subsidiaries' financial statements and information to
be included in the offering documents and marketing materials relating to the Debt Financing;
provided
that any such offering document or memorandum
that includes disclosure and financial statements and information with respect to the Company and its subsidiaries shall only reflect the Surviving Corporation and/or its subsidiaries as the
obligor(s); and (B) materials for rating agency presentations;
(v) executing
and delivering (or assisting in the execution and delivery of), as of the Closing, any pledge and security documents, other definitive financing documents or
other certificates or documents as may be reasonably requested by Parent (
provided
that (A) none of the documents or certificates shall be
executed and/or delivered except in connection with the Closing and (B) the effectiveness thereof shall be conditioned upon, or become operative upon, the occurrence of the Effective Time) and
otherwise facilitating the pledging of collateral, including obtaining such documentation and/or taking such other steps reasonably requested by Parent (including lien searches, payoff letters, lien
releases and instruments of termination or discharge, records that are reasonably requested by Parent in order to release all Liens over the property and assets of the Company and its subsidiaries and
taking reasonable actions for the purposes of establishing collateral arrangements);
(vi) at
least four (4) Business Days prior to the Closing Date, providing Parent with all documentation and information regarding the Company and its subsidiaries
reasonably required by regulatory authorities under applicable "know your customer" and anti-money laundering rules and regulations, including the USA Patriot Act of 2001 to the extent requested in
writing by Parent at least eight (8) Business Days prior to the Closing Date;
(vii) assisting
the Parent Parties in the preparation of pro forma financial information and pro forma financial statements by the Parent Parties and Merger Sub to be
included in any syndication, offering or other similar marketing materials and/or documents relating to the Debt Financing;
provided
, for the avoidance
of doubt, that the Company shall not be required to provide any information or assistance relating to (A) the proposed aggregate amount of debt financing, together with assumed interest rates,
dividends (if any) and fees and expenses relating to the incurrence of such debt financing, (B) any
post-Closing or pro forma cost savings, synergies, capitalization, ownership or other pro forma adjustments desired to be incorporated into any information used in connection with the Debt Financing,
or (C) any financial information related to the Parent Parties or any of its subsidiaries or any adjustments that are not directly related to the acquisition of the Company by Parent;
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(viii) cooperating
with the Lenders' requests for due diligence materials as is reasonably available to it and as is reasonably requested by Parent and customarily delivered
in connection with the Debt Financing agreements and documents; and
(ix) taking
and/or facilitating all corporate and other organizational actions, subject to the occurrence of the Closing, reasonably requested by Parent that are necessary
or customary to permit the consummation of the Debt Financing.
Notwithstanding the foregoing, (x) nothing in this
Section 5.16(b)
shall require such cooperation to the extent it
would (A) unreasonably interfere with the business or operations of the Company and its subsidiaries, or (B) require the Company to prepare separate financial statements for any of its
subsidiaries, (y) none of the Company or any of its subsidiaries shall be required to pay any commitment or other fee in connection with the Debt Financing contemplated by the Debt Financing
Commitments or be required to bear any cost or expense or incur any other liability that is not subject to reimbursement or indemnity from Parent, in any such case prior to the Effective Time, and
(z) nothing in this
Section 5.16(b)
shall require any action that would conflict with or violate in any material respect any Laws or cause
the Company and/or the Company's subsidiaries to violate any
obligation of confidentiality (not created in contemplation hereof) binding on the Company and/or its subsidiaries (provided that in the event that the Company and/or its subsidiaries do not provide
information in reliance on the exclusion in this clause (z), the Company and/or the subsidiaries shall use commercially reasonable efforts to provide notice to Parent and Merger Sub promptly
upon obtaining knowledge that such information is being withheld (but solely if providing such notice would not violate such obligation of confidentiality)). For the avoidance of doubt, none of the
Company or its subsidiaries or their respective officers, directors (with respect to any subsidiary of the Company) or employees shall be required to execute or enter into or perform any agreement
(including any board resolutions or similar actions) with respect to the Debt Financing contemplated by the Debt Financing Commitments that is not contingent upon the Closing or that would be
effective prior to the Closing, and no directors of the Company, acting in such capacity, shall be required to execute or enter into or perform any agreement (including any board resolutions or
similar actions) with respect to the Debt Financing
(c) Parent
(i) shall promptly, upon request by the Company, reimburse the Company for all reasonable and documented out-of-pocket costs (including
(A) reasonable outside attorneys' fees and (B) fees and expenses of the Company's accounting firms engaged to assist in connection with the Debt Financing, including performing
additional requested procedures, reviewing any offering documents, participating in any meetings and providing any comfort letters) to the extent incurred by the Company, any of the subsidiaries or
their Representatives in connection with the cooperation of the Company and its subsidiaries contemplated by this
Section 5.16
, and
(ii) shall indemnify and hold harmless the Company and its subsidiaries and their respective Representatives from and against any and all losses suffered or incurred by them in connection with
the arrangement of the Debt Financing and the performance of their respective obligations under this
Section 5.16
(including any action taken in
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accordance
with
Section 5.16(b)
) and any information utilized in connection therewith, in each case, except to the extent suffered or incurred as
a result of the bad faith, gross negligence, willful misconduct or material breach of this Agreement by the Company or any of its subsidiaries or, in each case, their respective Affiliates and
Representatives.
(d) The
Company hereby consents to the use of the logos of the Company and its subsidiaries by (i) the Parent Parties, Merger Sub and their respective licensees, any
Lenders, lead arrangers, bookrunners, syndication agents, commitment parties, purchasers, other equity or debt providers or similar entities involved in the Debt Financing, in each case, in connection
with the Debt Financing;
provided
that the Parent Parties and Merger Sub shall ensure that such logos are used by the above permitted parties solely in
a manner that is not intended, or that is not reasonably likely, to harm or disparage the Company or the Company's reputation or goodwill.
(e) The
Company shall, and shall cause its subsidiaries to, and shall use its reasonable best efforts to cause its and their respective officers, directors and employees to
use their reasonable best efforts to, and shall use its reasonable best efforts to direct its and their respective accountants, legal counsel and other Representatives to, update any Required
Information provided to the Parent Parties as may be necessary so that such Required Information (i) is Compliant throughout the Marketing Period and (ii) meets the applicable
requirements set forth in the definition of "Required Information". For the avoidance of doubt, the Parent Parties may, to most effectively access the financing markets, require the cooperation of the
Company and its subsidiaries under this Section 5.16 at any time, and from time to time and on multiple occasions, between the date hereof and the Closing, including by keeping current the
Required Information and providing any supplements to the Parent Parties so that the Parent Parties may most effectively access the financing markets. The Company agrees to (A) file all reports
on Form 10-K and Form 10-Q and Form 8-K (to the extent required to include financial information pursuant to Item 9.01 thereof) and (B) use its reasonable best
efforts to file all other Forms 8-K, in each case required to be filed with the SEC pursuant to the Exchange Act prior to the Closing Date in accordance with the periods required by the
Exchange Act.
Section 5.17
280G Matters.
As soon as practicable, but in
no event later than thirty (30) Business Days after the date hereof, the Company will make available to Parent true and correct copies of preliminary Section 280G calculations (based on
the assumptions set forth in the applicable calculations) with respect to each "disqualified individual" (within the meaning of Section 280G of the Code) who is reasonably likely to receive
payments or benefits in connection with the transactions contemplated by this Agreement that would not be deductible under Section 280G of the Code.
ARTICLE 6
CONDITIONS TO THE MERGER
Section 6.1
Conditions to Obligation of Each Party to Effect the
Merger
. The respective obligations of each party to effect the Merger shall be subject to the satisfaction (or waiver by Parent and the Company to the extent
permitted by applicable Law) at or prior to the Effective Time of the following conditions:
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(a) The
Company Shareholder Approval shall have been obtained in accordance with applicable Law and the articles of incorporation and bylaws of the Company.
(b) No
injunction or similar order by any court of competent jurisdiction that prohibits the consummation of the Merger shall have been entered and shall continue to be in
effect, and no Law shall have been enacted, entered, promulgated or enforced by any Governmental Entity that prohibits or makes illegal the consummation of the Merger.
(c) Any
waiting period under the HSR Act applicable to the Merger shall have expired or been earlier terminated and any applicable waiting period or approval required under
the Antitrust Laws of the jurisdictions listed on
Section 6.1(c)
of the Company Disclosure Letter shall have expired or been obtained.
(d) If
a CFIUS Request has occurred prior to the Closing, CFIUS Clearance shall have been obtained.
Section 6.2
Conditions to Obligation of the Company to Effect the
Merger
. The obligation of the Company to effect the Merger is further subject to the satisfaction (or waiver by the Company to the extent permitted by applicable
Law) of the following conditions:
(a) The
representations and warranties of Parent and Merger Sub set forth in
Article 4
shall be true and correct both
when made and at and as of the Closing Date, with the same force and effect as if made at and as of such time (except to the extent expressly made as of an earlier date, in which case as of such
date), except where the failure of such representations and warranties to be so true and correct (without regard to any qualifications as to materiality contained in such representations and
warranties) would not have, individually or in the aggregate, a Parent Material Adverse Effect.
(b) Parent
and Merger Sub shall have performed in all material respects all obligations and complied with all covenants required by this Agreement to be performed or
complied with by them prior to the Effective Time.
(c) Parent
shall have delivered to the Company a certificate, dated as of the Closing Date and signed by its Chief Executive Officer or another senior officer, certifying to
the effect that the conditions set forth in
Section 6.2(a)
and
Section 6.2(b)
have been
satisfied.
Section 6.3
Conditions to Obligations of Parent and Merger Sub to Effect the
Merger
. The obligations of Parent and Merger Sub to effect the Merger are further subject to the satisfaction (or waiver by Parent and Merger Sub to the extent
permitted by applicable Law) of the following conditions:
(a) (i)
The representations and warranties of the Company set forth in
Section 3.1
,
Section 3.2
,
Section 3.3(a)
,
Section 3.10(a)
,
Section 3.16
and
Section 3.20
shall be true and
correct in all material respects (other than
Section 3.2(a)
and
(b)
, which shall be true and correct in all respects except for de minimus changes) both when made and at and as of the Closing Date, with the same
force and effect as if made at and as of such time (except to the extent expressly made as of an earlier date, in which case as of such date), and (ii) the representations and warranties of the
Company set forth in
Article 3
(other than those set forth in clause (i) hereof) shall be true and correct both when made and at and
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as
of the Closing Date, with the same force and effect as if made at and as of such time (except to the extent expressly made as of an earlier date, in which case as of such date), except where the
failure of such representations and warranties to be so true and correct (without regard to any qualifications as to "Company Material Adverse Effect" or materiality contained in such representations
and warranties) would not have, individually or in the aggregate, a Company Material Adverse Effect.
(b) The
Company shall have performed in all material respects all obligations and complied with all covenants required by this Agreement to be performed or complied with by
it prior to the Effective Time.
(c) The
Company shall have delivered to Parent a certificate, dated as of the Closing Date and signed by its Chief Executive Officer or another senior officer, certifying to
the effect that the conditions set forth in
Section 6.3(a)
and
Section 6.3(b)
have been
satisfied.
(d) Since
the date of this Agreement, there shall not have occurred any Company Material Adverse Effect.
Section 6.4
Frustration of Closing Conditions
. No party
hereto may rely, either as a basis for not consummating the Merger or terminating this Agreement and abandoning the Merger, on the failure of any condition set forth in
Section 6.1
,
Section 6.2
or
Section 6.3
, as the case may be, to be satisfied if such failure was caused by such party's breach of any covenant or agreement of this
Agreement.
ARTICLE 7
TERMINATION
Section 7.1
Termination or Abandonment
. Anything
contained in this Agreement to the contrary notwithstanding, this Agreement may be terminated and abandoned at any time prior to the Effective Time, whether before or after any approval by the
shareholders of the Company of the matters presented in connection with the Merger, only as follows:
(a) by
the mutual written consent of the Company and Parent;
(b) by
either the Company or Parent if (i) the Effective Time shall not have occurred on or before January 31, 2017
(
provided
that if, as of such date all conditions set forth in
Section 6.1
,
Section 6.2
and
Section 6.3
shall have been satisfied or waived (other than those
conditions that are to be satisfied by action taken at the Closing) other than the conditions set forth in
Section 6.1(c)
or
(d)
, then such date shall
automatically be extended to May 30, 2017 (as may be so extended, the "
End
Date
")) and (ii) the party seeking to terminate this Agreement pursuant to this
Section 7.1(b)
shall not have
breached in any material respect its obligations under this Agreement in any manner that shall have contributed to the failure to consummate the Merger on or before such date;
(c) by
either the Company or Parent if any court of competent jurisdiction shall have issued or entered an injunction or similar order that permanently enjoins or otherwise
prohibits the
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consummation
of the Merger and such injunction or order shall have become final and non-appealable;
provided
that the party seeking to terminate this
Agreement pursuant to this
Section 7.1(c)
shall have complied with its obligations pursuant to
Section 5.6
to prevent, oppose and remove such
injunction or order;
(d) by
either the Company or Parent if the Company Meeting (including any adjournments or postponements thereof) shall have concluded and the Company Shareholder Approval
contemplated by this Agreement shall not have been obtained;
(e) by
the Company, if Parent or Merger Sub shall have breached or failed to perform in any material respect any of their representations, warranties, covenants or other
agreements contained in this Agreement, which breach or failure to perform (i) would result in a failure of a condition set forth in
Section 6.1
or
Section 6.2
and (ii) cannot be cured by the End Date or, if curable,
is not cured within 30 Business Days following the Company's delivery of written notice to Parent stating the Company's intention to terminate this Agreement pursuant to this
Section 7.1(e)
and the
basis for such termination;
provided
that the Company is not then in
material breach of any representation, warranty, agreement or covenant contained in this Agreement;
(f) by
Parent, if the Company shall have breached or failed to perform in any material respect any of its representations, warranties, covenants or other agreements
contained in this Agreement, which breach or failure to perform (i) would result in a failure of a condition set forth in
Section 6.1
or
Section 6.3
and (ii) cannot be cured by the End Date or, if curable, is not cured with 30 Business Days following Parent's delivery of
written notice to the Company stating Parent's intention to terminate this Agreement pursuant to this
Section 7.1(e)
and the basis for such
termination;
provided
that Parent or Merger Sub is not then in material breach of any representation, warranty, agreement or covenant contained in this
Agreement;
(g) at
any time prior to the date the Company Shareholder Approval is obtained, (i) by the Company, in accordance with
Section 5.3(c)
, provided, that simultaneously with such termination, the Company
shall tender payment to Parent of the Company Termination Fee
pursuant to
Section 7.3
; or (ii) by Parent, if (1) the Board of Directors of the Company shall have effected a Change of
Recommendation pursuant to
Section 5.3(c)
, (2) the Company enters into an Alternative Acquisition Agreement, (3) the Board of
Directors or any committee thereof approves, endorses or recommends any Alternative Proposal, (4) the Company or the Board of Directors shall have publicly announced its intention to do any of
the foregoing, (5) the Company materially breaches any of its obligations set forth in
Section 5.3
or (6) a tender or exchange
offer relating to the Company's securities shall have been commenced by a Person unaffiliated with Parent, and the Company shall have not sent to its security holders pursuant to Rule 14e-2
promulgated under the Exchange Act, within ten (10) Business Days after such tender or exchange offer is first published, sent or given, a statement disclosing that the Board of Directors of
the Company recommends rejection of such tender or exchange offer; and
(h) by
the Company, if (i) Parent is required to consummate the Closing pursuant to
Section 1.2
,
(ii) Parent and Merger Sub fail to consummate the Merger within three (3) Business Days of the first date (the "
First Date
") on which
Parent and Merger Sub are required to consummate the Closing pursuant to
Section 1.2
, and (iii) the Company has provided irrevocable
written notice to Parent at least
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one
(1) Business Day prior to the First Date confirming that it stands ready, willing and able to consummate the Merger and the other transactions contemplated hereby.
Section 7.2
Effect of Termination
. In the event of
termination of this Agreement pursuant to
Section 7.1
, this Agreement shall forthwith become null and void and there shall be no liability or
obligation on the part of the Company, Parent, Merger Sub or their respective Subsidiaries or Affiliates, except that (i) no such termination shall relieve any party of its obligation to pay
the Parent Termination Fee or the Company Termination Fee, as applicable, if, as and when required pursuant to
Section 7.3
or
Section 7.4
, as
applicable; (ii) no such termination shall relieve any party for liability for such party's intentional and willful breach
of its representations, warranties or covenants in this Agreement prior to its termination (except with respect to the limitations on liability set forth in
Section 7.3
and
Section 7.4
); and (iii) the Confidentiality Agreement and the
provisions of
Section 5.2(b)
, this
Section 7.2
,
Section 7.3
,
Section 7.4
and
Article 8
shall survive the termination hereof.
Section 7.3
Company Termination Fee
.
(a)
Company Termination Fee
. Any provision in this Agreement to the contrary notwithstanding, if (i) the
Company shall have validly terminated this Agreement pursuant to
Section 7.1(g)(i)
, (ii) Parent shall have validly terminated this
Agreement pursuant to
Section 7.1(g)(ii)
or (iii) (A) after the date of this Agreement, an Alternative Proposal is publicly
proposed or publicly disclosed prior to, and, with respect to a termination under
Section 7.1(d)
, not withdrawn at least two Business Days prior
to, the Company Meeting (a "
Qualifying Transaction
"), (B) this Agreement is validly terminated by Parent or the Company
pursuant
to Section 7.1(d)
and
Section 7.1(f)
, and (C) concurrently with or within
twelve months after such termination, the Company shall have entered into a definitive agreement providing for a Qualifying Transaction or completed a Qualifying Transaction, then the Company shall
pay, by wire transfer of immediately available funds to an account designated by Parent, a fee of $43 million in cash (the "
Company Termination
Fee
"), such payment to be made within three Business Days of such termination, or in the case of
Section 7.3(a)(iii)
,
within three Business Days after the later of (y) termination of this Agreement and (z) the date the Company enters into a definitive agreement providing for a Qualifying Transaction or
completes a Qualifying Transaction, as applicable; it being understood that in no event shall the Company be required to pay the Company Termination Fee on more than one occasion. Upon the payment by
the Company of the Company Termination Fee as and when required by this
Section 7.3(a)
, the Company shall have no further liability with respect
to this Agreement or the transactions contemplated hereby to Parent, Merger Sub or their respective Affiliates or Representatives, except to the extent provided in
Section 7.2
.
(b)
Acknowledgements
. Each party acknowledges that the agreements contained in this
Section 7.3
are an integral part of
this Agreement and that, without
Section 7.3(a)
, Parent would not have entered
into this Agreement. Accordingly, if the Company fails to promptly pay any amount due pursuant to this
Section 7.3
, the Company shall pay to the
Parent all fees, costs and expenses of enforcement (including attorneys' fees as well as expenses incurred in connection with any action initiated by such party), together with interest on the amount
of the Company Termination Fee at the prime lending rate as published in
The Wall Street Journal
, in effect on the date such payment is
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required
to be made. The parties further acknowledge that the Company Termination Fee shall not constitute a penalty but is liquidated damages, in a reasonable amount that will compensate Parent in
the circumstances in which the Company Termination Fee is payable for the efforts and resources expended and opportunities foregone while negotiating this Agreement and in reliance on this Agreement
and on the expectation of the consummation of the Merger, which amount would otherwise be impossible to calculate with precision. If this Agreement is terminated in circumstances where the Company
Termination Fee is payable pursuant to this
Section 7.3
, then following receipt by the Parent of the Company Termination Fee, the Company
Termination Fee (i) shall be in full and complete satisfaction of any and all damages against the Company and its Subsidiaries and their respective former, current or future officers,
directors, partners, shareholders, managers, members, Affiliates and Representatives arising out of, related to this Agreement, any contract or agreement executed in connection herewith, any breach by
the Company of this Agreement, the failure to consummate the transactions contemplated hereby or thereby, and any claims or actions arising out of the foregoing,
and (ii) shall be the sole and exclusive remedy of Parent and Merger Sub against the Company and its Subsidiaries and their respective former, current or future officers, directors, partners,
shareholders, managers, members, Affiliates and Representatives and none of the Company, any of its Subsidiaries or any of their respective former, current or future officers, directors, partners,
shareholders, managers, members, Affiliates or Representatives for any losses suffered as a result of this Agreement, any contract or agreement executed in connection herewith, any breach of this
Agreement or the failure of the transactions contemplated by this Agreement to be consummated, and none of the foregoing Persons shall have any further liability or obligation relating to or arising
out of this Agreement or the transactions contemplated hereby. The parties acknowledge that the right to receive the Company Termination Fee shall not limit or otherwise affect any such party's right
to specific performance as provided in
Section 8.5
.
Section 7.4
Parent Termination Fee
.
(a)
Parent Termination Fee.
Any provision in this Agreement to the contrary notwithstanding, if the Company
shall have validly terminated this Agreement pursuant to (i)
Section 7.1(e)
, or
(ii)
Section 7.1(h)
, then Parent shall pay, by wire transfer of immediately available funds to an account designated by the Company, a fee
of $86 million in cash (the "
Parent Termination Fee
"), such payment to be made within three Business Days of such termination; it being
understood that in no event shall the Parent be required to pay the Parent Termination Fee on more than one occasion. Upon the payment by the Parent of the Parent Termination Fee as and when required
by this
Section 7.4(a)
, together with any reimbursement owed for any Recoverable Amounts, the Parent and the Specified Persons shall have no
further liability with respect to this Agreement or the transactions contemplated hereby to the Company or their respective Affiliates or Representatives.
(b)
Acknowledgements.
Each party acknowledges that the agreements contained in this
Section 7.4
are an integral part of
this Agreement and that, without
Section 7.4(a)
, the
Company would not have entered into this Agreement. Accordingly, if Parent fails to promptly pay any amount due pursuant to this
Section 7.4
,
Parent shall pay to the Company all fees, costs and expenses of enforcement (including attorneys' fees as well as expenses incurred in connection with any action initiated by such party), together
with interest on the amount of the Parent Termination Fee at the
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prime
lending rate as published in
The Wall Street Journal
, in effect on the date such payment is required to be made. The parties further acknowledge
that the Parent Termination Fee shall not constitute a penalty but is liquidated damages, in a reasonable amount that (i) will compensate the Company in the circumstances in which Parent
Termination Fee is payable for the efforts and resources expended and opportunities foregone while negotiating this Agreement and in reliance on this Agreement and on the expectation of the
consummation of the Merger, which amount would otherwise be impossible to calculate with precision, (ii) shall be in full and complete satisfaction of any and all
damages against the Specified Persons arising out of, related to this Agreement, any contract or agreement executed in connection herewith (including the Debt Commitment Letter), any breach by the
Parent or Merger Sub of this Agreement, the failure to consummate the transactions contemplated hereby or thereby, and any claims or actions arising out of the foregoing, and (iii) shall
constitute the sole and exclusive remedy (whether at law, in equity, in contract, in tort or otherwise) of the Company and its Affiliates for damages against Parent, Merger Sub and the former, current
or future, direct or indirect, equityholders, controlling persons, directors, officers, employees, agents, Affiliates, members, managers, general or limited partners of Parent, Merger Sub or any of
their respective successors or assigns, or any current or future equityholder, controlling person, director, officer, employee, agent, Affiliate, member, manager, general or limited partner or of any
of the foregoing (collectively, the "
Specified Persons
"), for any losses suffered as a result of this Agreement, any contract or agreement executed in
connection herewith (including the Debt Commitment Letter), any breach of this Agreement or the failure of the transactions contemplated by this Agreement to be consummated, and upon payment in full
of the Parent Termination Fee, none of the Specified Persons shall have any further liability or obligation relating to or arising out of this Agreement, the Debt Financing, or the transactions
contemplated hereby or thereby, except, in the case of clauses (i), (ii) and (iii), (A) for the obligations of Greeneden U.S. Holdings II, LLC under the Confidentiality
Agreement and (B) for the obligations of Parent and Merger Sub for any reimbursement or indemnification owed to the Company pursuant to
Section 5.16(c)
(any amounts owed pursuant to
clauses (A) and (B), collectively, the "
Recoverable
Amounts
"). For the avoidance of doubt, in the event the Closing does not occur, in no event shall the Specified Persons be subject to (nor shall the Company or its
Subsidiaries, or any of their Affiliates seek to recover) monetary damages in excess of the Parent Termination Fee for any losses arising from or in connection with breaches by the Parent or Merger
Sub of their respective representations, warranties, covenants and agreements contained in this Agreement or arising from any Action in law or equity that the Company or its Subsidiaries, or any of
their Affiliates may have for any loss suffered as a result of the failure of the transactions contemplated by this Agreement to be consummated. The parties acknowledge that, until such time as this
Agreement is validly terminated and Parent pays the Parent Termination Fee, the right to receive the Parent Termination Fee shall not limit or otherwise affect any such party's right to specific
performance as provided in
Section 8.5
. For the avoidance of doubt, under no circumstances shall the Company be permitted or entitled to obtain
specific performance as provided in
Section 8.5
and also any money damages, including all or any portion of the Parent Termination Fee.
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ARTICLE 8
MISCELLANEOUS
Section 8.1
No Survival of Representations and
Warranties.
None of the representations and warranties in this Agreement or in any instrument delivered pursuant to this Agreement shall survive the Effective
Time.
Section 8.2
Expenses.
Except as set forth in
Section 7.3
, whether or not the Merger is consummated, all costs and expenses incurred in connection with the Merger, this Agreement and the
transactions contemplated hereby shall be paid by the party incurring or required to incur such expenses, except that all filing fees paid by any party in respect of any HSR Act or other regulatory
filing shall be borne by Parent.
Section 8.3
Counterparts; Effectiveness
. This Agreement
may be executed in counterparts (including by facsimile, by electronic mail in "portable document format" (.pdf) form, or by any other electronic means intended to preserve the original graphic and
pictoral appearance of a document), each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument, and shall become effective when one
or more counterparts have been signed by each of the parties and delivered (by telecopy, facsimile, electronic mail or otherwise) to the other parties.
Section 8.4
Governing Law; Jurisdiction
.
(a) This
Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice or conflict of law provision
or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware;
provided
,
however
, that the Merger (and the fiduciary duties of the Company's directors and officers in
connection with the Merger and this Agreement in general) shall be exclusively governed by and construed in accordance with the laws of the State of Indiana, without giving effect to any choice or
conflict of law provision or rule. In addition, each of the parties hereto irrevocably agrees that any legal action or proceeding with respect to this Agreement and the rights and obligations arising
hereunder, or for recognition and enforcement of any judgment in respect of this Agreement and the rights and obligations arising hereunder brought by the other party hereto or its successors or
assigns, shall be brought and determined exclusively in the state or federal courts of the State of Delaware. Each of the parties hereto hereby irrevocably submits with regard to any such action or
proceeding for itself and in respect of its property, generally and unconditionally, to the personal jurisdiction of the aforesaid courts and agrees that it will not bring any action relating to this
Agreement or any of the transactions contemplated by this Agreement in any court other than the aforesaid courts. Each of the parties hereto hereby irrevocably waives, and agrees not to assert as a
defense, counterclaim or otherwise, in any action or proceeding with respect to this Agreement, (A) any claim that it is not personally subject to the jurisdiction of the above-named courts for
any reason other than the failure to serve in accordance with this
Section 8.4
, (B) any claim that it or its property is exempt or immune
from the jurisdiction of any such court or from any legal process commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment,
execution of judgment or otherwise) and (C) to the
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fullest
extent permitted by the applicable Law, any claim that (i) the Action in such court is brought in an inconvenient forum, (ii) the venue of such Action is improper or
(iii) this Agreement, or the subject matter hereof, may not be enforced in or by such courts.
(b) Notwithstanding
anything to the contrary in this Agreement, (i) no party hereto, nor any of its affiliates, will bring, or support the bringing of, any claim,
legal action or proceeding, whether at law or in equity, whether in contract or in tort or otherwise, against any Financing Related Parties in any way relating to this Agreement or any of the
transactions contemplated by this Agreement, anywhere other than in the Supreme Court of the State of New York, County of New York (and the appellate courts thereof), or, if under applicable law
exclusive jurisdiction is vested in the federal courts, the United States District Court for the Southern District of New York (and the appellate courts thereof) and (ii) except as specifically
set forth in the Debt Financing Commitments, all claims or causes of action (whether at law, in equity, in contract, in tort or otherwise) against any of the Financing Related Parties in any way
relating to this Agreement, the Debt Financing Commitments or the performance thereof or the transactions contemplated hereby or thereby shall be exclusively governed by, and construed in accordance
with, the internal laws of the State of New York, without giving effect to principles or rules or conflict of laws to the extent such principles or rules would require or permit the application of
Laws of another jurisdiction. The parties hereto further agree to waive and hereby irrevocably waive, to the fullest extent permitted by law, any objection which it may now have or hereafter have to
the laying of venue of, and the defense of an inconvenient forum to the maintenance of, any such action in any such court and makes the agreements, waivers and consents set forth in
Section 8.4(a)
mutatis mutandis but with respect to the courts specified in this
Section 8.4(b)
.
Section 8.5
Specific Enforcement
.
(a) The
parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific
terms or were otherwise breached. Each party agrees that, subject to
Section 8.5(b)
, in the event of any breach or threatened breach by any other
party of any covenant or obligation contained in this Agreement, the non-breaching party shall be entitled (in addition to any other remedy that may be available to it whether in law or equity,
including monetary damages, subject to the limitations set forth in
Section 7.3
and
Section 7.4
) to obtain (A) a decree or order of specific
performance to enforce the observance and performance of such covenant or
obligation and (B) an injunction restraining such breach or threatened breach. Subject to
Section 8.5(b)
, in circumstances where Parent
and Merger Sub are obligated to consummate the Merger and the Merger has not been consummated, Parent and Merger Sub expressly acknowledge and agree that the Company and its shareholders shall have
suffered irreparable harm, that monetary damages will be inadequate to compensate the Company and its shareholders, and that the Company on behalf of itself and its shareholders shall be entitled (in
addition to any other remedy that may be available to it whether in law or equity, including monetary damages, subject to the limitations set forth in
Section 7.3
and
Section 7.4
) to enforce specifically Parent's and Merger Sub's obligations
to consummate the Merger. Each party further agrees that no other party or any other Person shall be required to obtain, furnish or post any bond or similar instrument in connection with or as a
condition to obtaining any remedy referred to in this
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Section 8.5
, and each party irrevocably waives any right it may have to require the obtaining, furnishing or posting of any such bond or similar
instrument.
(b) Notwithstanding
Section 8.5(a)
, it is acknowledged and agreed that the right of the Company to an injunction,
specific performance or other equitable remedy in connection with enforcing Parent's obligation to cause the Closing to occur will be subject to the requirements that (A) all of the conditions
set forth in
Section 6.1
and
Section 6.3
have been satisfied (other than those conditions
that by their terms are to be satisfied at the Closing, each of which is capable of being satisfied at the Closing) at the time
Section 1.2
contemplated the Closing to occur, (B) the Debt Financing has been funded or will be funded on the date the Closing is required to have occurred pursuant to
Section 1.2
, (C) Parent and
Merger Sub shall have failed to consummate the Merger by the time the Closing was required by
Section 1.2
to occur, and (D) the Company has irrevocably notified Parent in writing that
(x) the Company is ready, willing and
able to consummate the Merger, and (y) all conditions set forth in
Section 6.2
have been satisfied (other than those conditions that by
their terms are to be satisfied at the Closing, each of which is capable of being satisfied at the Closing) or that it is willing to waive any unsatisfied conditions set forth in
Section 6.2
and if
specific performance is granted and the Debt Financing are funded, the Closing will occur. For the avoidance of doubt, nothing
contained herein shall limit the right of the Company to seek injunctions, specific performance or other equitable remedies to enforce the obligations of Parent and Merger Sub under
Section 5.16
or
any other obligations of Parent and Merger Sub herein; provided, that in no event shall the Company be entitled to enforce or
seek to enforce specifically Parent's obligation to cause the Closing to occur if the Debt Financing has not been funded.
Section 8.6
WAIVER OF JURY TRIAL
. EACH OF THE PARTIES TO
THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY (INCLUDING THE DEBT FINANCING COMMITMENTS AND THE FINANCING). EACH PARTY MAKES THIS WAIVER VOLUNTARILY AND SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS CONTAINED IN THIS
SECTION 8.6
.
Section 8.7
Notices
. Any notice required to be given
hereunder shall be sufficient if in writing, and sent by email, facsimile transmission, by reliable overnight delivery service (with proof of service), hand delivery or certified or registered mail
(return receipt requested and first-class postage prepaid), addressed as follows:
To
Parent or Merger Sub:
Genesys Telecommunications Laboratories, Inc.
2001 Junipero Serra Blvd., 9th Floor
Daly City, CA 94014
Attn: James M. René
Telecopy No.: (650) 466-1260
Email: Jim.Rene@genesys.com
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with
a copy to:
Fried,
Frank, Harris, Shriver & Jacobson LLP
801 17th Street, NW
Washington, DC 20006
Attention: Brian Mangino
Telecopy No.: (202)639-7003
Email: brian.mangino@friedfrank.com
and
Fried,
Frank, Harris, Shriver & Jacobson LLP
One New York Plaza
New York, NY 10004
Attention: Randi Lally
Telecopy No.: (212) 859-4000
randi.lally@friedfrank.com
To
the Company (prior to the Closing):
Interactive
Intelligence Group, Inc.
7601 Interactive Way
Indianapolis, IN 46278
Attention: Ashley Vukovits
Fax: (317) 715-8265
Email: Ashley.Vukovits@inin.com
with
a copy to:
Faegre
Baker Daniels LLP
600 East 96
th
Street, Suite 600
Indianapolis, IN 46240
Attention: J. Jeffrey Brown
Telecopy No.: (317) 569-4800
Email: jeff.brown@faegrebd.com
or
to such other address as any party shall specify by written notice so given, and such notice shall be deemed to have been delivered (a) when received when sent by email or facsimile,
provided
that
the recipient confirms in writing its receipt thereof, (b) upon proof of service when sent by reliable overnight delivery service,
(c) upon personal delivery in the case of hand delivery or (d) upon receipt of the return receipt when sent by certified or registered mail. Any party to this Agreement may notify any
other party of any changes to the address or any of the other details specified in this paragraph;
provided
,
however
, that such notification shall only be
effective on the date specified in such notice or two Business Days after the notice is given, whichever
is later. Rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was given shall be deemed to be receipt of the notice as of the date of such
rejection, refusal or inability to deliver.
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Section 8.8
Assignment; Binding Effect
. Neither this
Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the parties hereto (whether by operation of law or otherwise) without the prior written consent of the
other parties, Subject to the preceding sentence, this Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns.
Section 8.9
Severability
. Any term or provision of this
Agreement that is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the sole extent of such invalidity or unenforceability without rendering invalid or
unenforceable the remainder of such term or provision or the remaining terms and provisions of this Agreement in any jurisdiction. If any provision of this Agreement is so broad as to be
unenforceable, such provision shall be interpreted to be only so broad as is enforceable.
Section 8.10
Entire Agreement; No Third-Party
Beneficiaries
. This Agreement (including the exhibits and schedules hereto) and the Confidentiality Agreement constitute the entire agreement, and supersede all
other prior agreements and understandings, both written and oral, between the parties, or any of them, with respect to the subject matter hereof and thereof. Except (a) for the provisions of
Article 2
(which, from and after the Effective Time, shall be solely for the benefit of holders of the Common Stock and Company Equity Awards as
of the Effective Time), (b)
Section 5.9
(which, solely from and after the
Effective Time, shall be solely for the benefit of the Indemnified Parties), (c)
Section 7.4(b)
and this clause (c) of
Section 8.10
(which, to the extent such Section relates to the Specified Persons, shall inure to the benefit of each of the Specified Persons)
and (d)
Section 8.4(b)
,
Section 8.6
, this clause (d) of
Section 8.10
, the last
sentence of
Section 8.11
and
Section 8.16
(which in each case, to the extent that any such Section relates to the Financing Related Parties,
shall inure to the benefit each
of the Financing Related Parties), this Agreement is for the sole benefit of the parties hereto and their permitted assigns and nothing herein is intended to and shall not confer upon any Person other
than the parties hereto any rights or remedies hereunder.
Section 8.11
Amendments; Waivers
. At any time prior to
the Effective Time, any provision of this Agreement may be amended or waived if, and only if, such amendment or waiver is in writing and signed, in the case of an amendment, by the Company, Parent and
Merger Sub, or in the case of a waiver, by the party against whom the waiver is to be effective; provided, however, that after receipt of the Company Shareholder Approval, if any such amendment or
waiver shall by applicable Law or in accordance with the rules and regulations of Nasdaq require further approval of the shareholders of the Company, the effectiveness of such amendment or waiver
shall be subject to the approval of the shareholders of the Company. Notwithstanding the foregoing, no failure or delay by the Company or Parent in exercising any right hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise of any other right hereunder. Notwithstanding anything in this Agreement to the contrary,
Section 8.4(b)
,
Section 8.6
, clause (d) of the second sentence of
Section 8.10
, this sentence of this
Section 8.11
and
Section 8.16
(and any provision of this Agreement to the extent an amendment, modification, waiver or termination of such provision would modify
the substance of any of such provisions) may not be amended, modified, waived or terminated in a manner that impacts or is adverse in any respect to any of the Financing Related Parties without the
prior written consent of the Lenders that as of the date of such amendment are providing the Debt Financing.
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Section 8.12
Headings
. Headings of the Articles and
Sections of this Agreement are for convenience of the parties only and shall be given no substantive or interpretive effect whatsoever. The table of contents to this Agreement is for reference
purposes only and shall not affect in any way the meaning or interpretation of this Agreement.
Section 8.13
Interpretation
. When a reference is made in
this Agreement to an Article or Section, such reference shall be to an Article or Section of this Agreement unless otherwise indicated. Whenever the words "include," "includes" or "including" are used
in this Agreement, they shall be deemed to be followed by the words "without limitation." The words "hereof," "herein" and "hereunder" and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision of this Agreement. All terms defined in this Agreement shall have the defined meanings when used in any certificate or other
document made or delivered pursuant thereto unless otherwise defined therein. The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and
to the masculine as well as to the feminine and neuter genders of such terms. Each of the parties has participated in the drafting and negotiation of this Agreement. If an ambiguity or question of
intent or interpretation arises, this Agreement must be construed as if it is drafted by all the parties, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue
of authorship of any of the provisions of this Agreement.
Section 8.14
Obligations of Merger Sub
. Whenever this
Agreement requires Merger Sub to take any action, such requirement shall be deemed to include an undertaking on the part of Parent to cause such Merger Sub to take such action.
Section 8.15
Non-Recourse
. Each party agrees, on behalf
of itself and its Affiliates and its and their directors, officers, partners and members (collectively, "
Related Parties
"), that all Actions, claims,
obligations, liabilities or causes of action (whether in Contract or in tort, in Law or in equity or otherwise, or granted by statute or otherwise, whether by or through attempted piercing of the
corporate, limited partnership or limited liability company veil or any other theory or doctrine, including alter ego or otherwise) that may be based upon, in respect of, arise under, out or by reason
of, be connected with, or relate to: (A) this Agreement or the transactions contemplated hereunder, (B) the negotiation, execution or performance this Agreement (including any
representation or warranty made in, in connection with, or as an inducement to, this Agreement), (C) any breach or violation of this Agreement, and (D) any failure of the transactions
contemplated hereunder to be consummated, in each case, may be made only against the Persons that are expressly identified as parties to this Agreement and, in accordance with, and subject to the
terms and conditions of this Agreement. In furtherance and not in limitation of the foregoing, and notwithstanding anything contained in this Agreement, each party hereto covenants, agrees and
acknowledges, on behalf of itself and its respective Affiliates and Related Parties, that no recourse under this Agreement shall be sought or had against any other Person, and no other Person shall
have any liabilities or obligations (whether in Contract or in tort, in Law or in equity or otherwise, or granted by statute or otherwise, whether by or through attempted piercing of the corporate,
limited partnership or limited liability company veil or any other theory or doctrine, including alter ego or otherwise) for any claims, causes of action, obligations or liabilities arising under, out
of, in connection with or related to the items in the immediately preceding clauses (A) through (D), it being expressly agreed and acknowledged that no personal liability or losses whatsoever
shall attach to, be imposed on or otherwise be incurred by any of
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the
aforementioned, as such, arising under, out of, in connection with or related to the items in the immediately preceding clauses (A) through (D), except in each case for claims that the
Company may assert against Greeneden U.S. Holdings II, LLC pursuant to the terms of the Confidentiality Agreement.
Section 8.16
No Recourse to Financing Related Parties
. No
Financing Related Party shall have any liability or obligation to the Company with respect to this Agreement or with respect to any claim or cause of action (whether in Contract or in tort, in Law or
in equity or otherwise, or granted by statute or otherwise, whether by or through attempted piercing of the corporate, limited partnership or limited liability company veil or any other theory or
doctrine, including alter ego or otherwise) that may be based upon, in respect of, arise under, out or by reason of, be connected with, or relate to: (A) this Agreement or the transactions
contemplated hereunder, (B) the negotiation, execution or performance of this Agreement (including any representation or warranty made in, in connection with, or as an inducement to, this
Agreement), (C) any breach or violation of this Agreement, and (D) any failure of the transactions contemplated hereunder to be consummated, it being expressly agreed and acknowledged by
the Company that no personal liability or losses whatsoever shall attach to, be imposed on or otherwise be incurred by any Financing Related Party, as such, arising under, out of, in connection with
or related to the items in the immediately preceding clauses (A) through (D). For the avoidance of doubt, this
Section 8.16
does not limit
or affect any rights or remedies that Parent or Merger Sub may have against the parties to the Debt Commitment Letter.
Section 8.17
Definitions
. For purposes of this Agreement,
the following terms (as capitalized below) will have the following meanings when used herein:
"
Action
" has the meaning set forth in
Section 5.9(b)
.
"
Affiliates
" means, with respect to any Person, any other Person that, directly or indirectly, controls, or is controlled by, or is under
common control with, such Person. As used in this definition, "
control
" (including, with its correlative meanings, "
controlled
by
" and "
under common control with
") shall mean the possession, directly or indirectly, of the power to direct or cause the
direction of management or policies of a Person, whether through the ownership of securities or partnership or other ownership interests, by contract or otherwise.
"
Agreement
" has the meaning set forth in the Preamble.
"
Alternative Proposal
" has the meaning set forth in
Section 5.3(e)
.
"
Alternative Financing
" has the meaning set forth in
Section 5.16(a)(ii)
.
"
Annual Bonus Plan Participant
" has the meaning set forth in
Section 5.5(e)
.
"
Anti-Corruption Laws
" means the U.S. Foreign Corrupt Practices Act of 1977, as amended; the U.S. Travel Act, 18 U.S.C.
§ 1952; the U.K. Bribery Act of 2010; any applicable Law enacted in connection with, or arising under, the OECD Convention on Combating Bribery of Foreign Public Officials in
International Business Transactions; or any other applicable Laws or regulations of any Governmental Entity relating to bribery or corruption.
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"
Antitrust Law
" means the HSR Act, the Federal Trade Commission Act, as amended, the Sherman Act, as amended, the
Clayton Act, as amended, and any other applicable federal, state or foreign statutes, rules, regulations, orders, decrees, administrative and judicial doctrines and other Laws that are designed or
intended to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade or lessening of competition through merger or acquisition.
"
Articles of Merger
" has the meaning set forth in
Section 1.3
.
"
Bankruptcy and Equity Exceptions
" has the meaning set forth in
Section 4.5(b)
.
"
Book-Entry Shares
" has the meaning set forth in
Section 2.2(a)
.
"
Business Day
" means any day other than a Saturday, Sunday or a day on which the banks in New York are authorized by law or executive
order to be closed.
"
Cancelled Shares
" has the meaning set forth in
Section 2.1(a)(ii)
.
"
Capped Call Transactions
" means the transactions contemplated by the Confirmations, each dated May 19, 2015, between the Company
and each of JP Morgan Chase Bank, NA, Morgan Stanley & Co. LLC and Royal Bank of Canada, each as amended.
"
Certificates
" has the meaning set forth in
Section 2.2(a)
.
"
CFIUS
" means the Committee on Foreign Investment in the United States.
"
CFIUS Clearance
" means the giving of notice to the parties with respect to the transaction contemplated hereby in accordance with the
requirements of Exon-Florio and its applicable regulations and the receipt by the parties of written notice from CFIUS of its (a) determination that the transaction contemplated hereby does not
constitute a "covered transaction" under Exon-Florio, (b) determination to the effect that review (or, if applicable, investigation) of the transaction contemplated hereby has been concluded
and that a determination has been made that there are no unresolved national security concerns, or (c) following an investigation conducted by CFIUS pursuant to Exon-Florio, CFIUS reports the
transaction contemplated hereby to the President of the United States and the President of the United States does not take any action to suspend or prohibit such transaction pursuant to his
authorities under Exon-Florio.
"
CFIUS Request
" has the meaning set forth in
Section 5.6(b)
"
Change of Recommendation
" has the meaning set forth in
Section 5.3(c)
.
"
Closing
" has the meaning set forth in
Section 1.2
.
"
Closing Date
" has the meaning set forth in
Section 1.2
.
"
Code
" has the meaning set forth in
Section 2.2(b)(iii)
.
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"
Common Stock
" has the meaning set forth in
Section 2.1(a)(i)
.
"
Company
" has the meaning set forth in the Preamble.
"
Company 401(k) Plan
" has the meaning set forth in
Section 5.5(g)
.
"
Company Benefit Plans
" has the meaning set forth in
Section 3.9(a)
.
"
Company Disclosure Letter
" has the meaning set forth in
Article
3.
"
Company Employees
" has the meaning set forth in
Section 5.5(a)
.
"
Company Equity Awards
" means Company Options and Company RSUs.
"
Company Foreign Plan
" has the meaning set forth in
Section 3.9(a)
.
"
Company Material Adverse Effect
" means an event, change, occurrence or development that has had or would reasonably be expected to have a
material adverse effect on the business, operations, properties, assets, results of operations or condition (financial or otherwise) of the Company and its Subsidiaries, taken as a whole, but shall
not include events, changes, occurrences or developments relating to or resulting from (a) changes in general economic or political conditions or the securities, equity, credit or financial
markets in general, or changes in or affecting domestic or foreign interest or exchange rates, (b) any decline in the market price or trading volume of the Common Stock or any change in the
credit rating of the Company or any of its securities or any failure to meet internal or published projections, forecasts, guidance or revenue or earnings predictions (provided that the facts and
circumstances underlying any such decline, change or failure may be taken into account in determining whether a Company Material Adverse Effect has occurred to the extent not otherwise prohibited by
the definition thereof), (c) general changes or developments in the industries in which the Company and its
Subsidiaries operate, including general changes in Law or regulation (or the interpretation or enforcement thereof), in each case made after the date hereof and across such industries, (d) the
execution, delivery and performance of this Agreement or the public announcement or pendency or consummation of the Merger or other transactions contemplated hereby, including the impact thereof on
the relationships, contractual or otherwise, of the Company or any of its Subsidiaries with employees, labor unions, financing sources, partnerships, customers, suppliers or partners, or the taking of
any action required by this Agreement or consented to or requested by Parent in writing, (e) the identity of Parent or any of its Affiliates as the acquiror of the Company, or any litigation
relating to or resulting from this Agreement or the transactions contemplated hereby, (f) any acts of terrorism or war or other hostilities, including the outbreak, worsening or escalation
thereof, or any hurricane, tornado, flood, earthquake, natural disasters, acts of God or other comparable events, or (g) changes in generally accepted accounting principles or the
interpretation or enforcement thereof after the date hereof;
except
, with respect to clauses (a), (c) and (f), to the extent that the
impact thereof has a disproportionate effect on the business, operations, properties, assets, results of operations or condition (financial or otherwise) of the Company and its Subsidiaries, taken as
a whole, relative to others in the industry or industries in which the Company and its Subsidiaries operate.
"
Company Material Contract
" has the meaning set forth in
Section 3.18(a)
.
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"
Company Meeting
" has the meaning set forth in
Section 5.4(d)
.
"
Company Option
" means an option to acquire Shares granted pursuant to a Company Stock Plan.
"
Company Owned Intellectual Property
" has the meaning set forth in
Section 3.14(b)
.
"
Company Permits
" has the meaning set forth in
Section 3.8(b)
.
"
Company RSU
" means any issued and outstanding restricted stock units granted under or pursuant to the Company Stock Plan.
"
Company SEC Documents
" has the meaning set forth in
Section 3.4(a)
.
"
Company Shareholder Approval
" has the meaning set forth in
Section 3.17
.
"
Company Stock Plan
" means the Company's 2006 Equity Incentive Plan, as amended
"
Company Termination Fee
" has the meaning set forth in
Section 7.3(a)
.
"
Compliant
" means, with respect to the Required Information, that (i) such Required Information does not contain any untrue
statement of a material fact regarding the Company and its subsidiaries, or omit to state any material fact regarding the Company and its subsidiaries necessary in order to make such Required
Information not materially misleading under the circumstances, (ii) such Required Information complies with all applicable requirements of Regulation S-X and Regulation S-K under
the Securities Act for a registered public offering of debt securities on Form S-1, but limited to the type and form customarily included in a preliminary offering memorandum for debt
securities under Rule 144A of the Securities Act (it being understood none of such information need include (a) any statements or information required by Rules 3-09, 3-10 or 3-16
of Regulation S-X or for any period prior to January 1, 2013 and (b) other information customarily excluded from a preliminary offering memorandum used for an offering of high
yield debt securities pursuant to Rule 144A of the Securities Act), to consummate an offering of non-convertible debt securities by a large accelerated filer as contemplated by the Debt
Financing Commitments, assuming that such offering was consummated at the same time during the Company's fiscal year as such offering of debt securities will be made and (iii) the financial
statements and other financial information included in such Required Information would not be deemed "stale" or otherwise be unusable under customary practices for offerings and private placements of
debt securities under Rule 144A of the Securities Act and are sufficient to permit the Company and its subsidiaries' applicable independent accountants to issue customary comfort letters to the
financing sources providing the portion of the Debt Financing consisting of debt securities, including as to customary change period "negative assurance" comfort, in order to consummate any offering
of debt securities on any day during the Marketing Period, which such accountants have confirmed they are prepared to issue.
"
Confidentiality Agreement
" has the meaning set forth in
Section 5.2(b)
.
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"
Contract
" means any legally binding, written contract, note, bond, mortgage, indenture, deed of trust, lease, commitment, agreement or
other obligation or arrangement.
"
Converted Shares
" has the meaning set forth in
Section 2.1(a)(ii)
.
"
Convertible Notes
" means the Company's 1.25% Convertible Senior Notes due 2020 in the outstanding aggregate principal amount of
$150 million.
"
Debt Commitment Letter
" has the meaning set forth in
Section 4.5(a)
.
"
Debt Financing
" has the meaning set forth in
Section 4.5(a)
.
"
Debt Financing Commitments
" has the meaning set forth in
Section 4.5(a)
.
"
Effective Time
" has the meaning set forth in
Section 1.3
.
"
End Date
" has the meaning set forth in
Section 7.1(b)
.
"
Environmental Laws
" means any Law, including any common law cause of action, relating to arising out of, relating to, or resulting from
pollution, contamination, protection of the environment, human health or safety, health or safety of employees, sanitation, and any matters relating to emissions, discharges, disseminations, releases
or threatened releases of pollutants, contaminants, toxic or hazardous substances.
"
ERISA
" has the meaning set forth in
Section 3.9(a)
.
"
ERISA Affiliate
" has the meaning set forth in
Section 3.9(c)
.
"
Exchange Act
" means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
"
Exchange Fund
" has the meaning set forth in
Section 2.2(a)
.
"
Exon-Florio
" means the Exon-Florio Amendment to the Defense Production Act of 1950, 50 U.S.C. app. § 2170.
"
Export and Import Control Laws
" means any U.S. or applicable non-U.S. law, regulation, or order governing (i) imports, exports,
re-exports, or transfers of products, services, software, or technologies; or (ii) economic sanctions or embargoes.
"
Fair Value
" means the amount at which the assets (both tangible and intangible), in their entirety, of Parent and its Subsidiaries would
change hands between a willing buyer and a willing seller, within a commercially reasonable period of time, each having reasonable knowledge of the relevant facts, with neither being under any
compulsion to act.
"
Financing Related Parties
" means the Lenders (in their respective capacities as lenders, arrangers, bookrunners, managers and/or agents
under the Debt Financing Commitments) and their respective
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Affiliates,
any other sources of financing (and their respective Affiliates) to Parent and/or any of its Affiliates in connection with the transactions contemplated by this Agreement and each of the
respective officers, directors, employees, agents, advisors, controlling persons and other representatives and successors of any of the foregoing.
"
First Date
" has the meaning set forth in
Section 7.1(h)
.
"
GAAP
" means United States generally accepted accounting principles.
"
Governmental Entity
" has the meaning set forth in
Section 3.3(a)
.
"
HSR Act
" has the meaning set forth in
Section 3.3(a)
.
"
IBCL
" has the meaning set forth in the Recitals.
"
Indemnified Party
" has the meaning set forth in
Section 5.9(b)
.
"
Intellectual Property
" has the meaning set forth in
Section 3.14(a)
.
"
Knowledge
" means (a) with respect to Parent, the actual knowledge of Paul Segre, Nick Gerostathos or Jim René and
(b) with respect to the Company, the actual knowledge of the individuals listed on
Section 8.17(b)
of the Company Disclosure Letter.
"
Law
" or "
Laws
" has the meaning set forth in
Section 3.8(a)
.
"
Lease
" has the meaning set forth in
Section 3.15
.
"
Lender
" means each of Goldman Sachs Bank USA, Bank of America, N.A. Merrill Lynch, Pierce, Fenner & Smith Incorporated, Royal Bank
of Canada, RBC Capital Markets, Citigroup Global Markets Inc., Citibank, N.A., Citicorp USA, Inc., and Citicorp North America, Inc.;
provided
that in the event that any Additional
Commitment Party (as defined in the Debt Commitment Letter) is added as a party to the Debt Commitment
Letter after the date hereof, the term "Lender" shall include each such institution and,
provided
,
further
, that the term "Lender" shall include each
institution party to any commitment letter or similar agreement for any Alternative Financing.
"
Lien
" means a lien, mortgage, pledge, security interest, charge, title defect, claim, option to purchase or other encumbrance of any kind
or nature whatsoever.
"
LLC 1
" has the meaning set forth in the Preamble.
"
LLC 2
" has the meaning set forth in the Preamble.
"
Luxco 3
" has the meaning set forth in the Preamble.
"
Marketing Period
" means the first period of twenty (20) consecutive Business Days commencing on or after September 6, 2016
and (i) throughout and at the end of which the Parent Parties shall have received the Required Information and the Required Information is Compliant;
provided
that, if the Company shall in good
faith reasonably believe that it has delivered the Required Information and that
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the
Required Information is Compliant as of the date of delivery, the Company may deliver to Parent and Merger Sub a written notice to that effect (stating when it believes it completed the delivery
of the Required Information and that the Required Information is Compliant as of the date of delivery), in which case such twenty (20) consecutive Business Day period shall, subject to the
other conditions set forth in this definition of "Marketing Period", be deemed to have commenced on the date such notice is delivered unless Parent or Merger Sub in good faith reasonably believes that
the Company has not completed delivery of the Required Information or that the Required Information is not Compliant and not later than 5:00 p.m. (New York City time) seven (7) Business
Days after the delivery of such notice by the Company, delivers a written notice to the Company to that effect (stating with specificity which such Required Information the Company has not delivered
or why the Required Information is not Compliant as of the date of delivery), (ii) throughout and at the end of which, (1) the conditions set forth in
Section 6.1
(other than
Section 6.1(a)) and
Section 6.3
(other than those
conditions that by their nature are to be satisfied by actions to be taken at the Closing, but subject to the satisfaction or waiver of such conditions at the Closing) shall be satisfied,
(2) the definitive proxy statement relating to the Company Shareholder Approval has been mailed to the holders of the Shares and (3) nothing has occurred and no condition exists that
would cause any of the conditions set forth in
Section 6.1
(other than
Sections 6.1(a)
))
or
Section 6.3
to fail to be satisfied, assuming the Closing were to be scheduled for any time during such twenty (20) consecutive
Business Day period and (iii) during the last ten (10) Business Days of such twenty (20) consecutive Business Day period the condition set forth in Section 6.1(a) shall
have been satisfied;
provided
that (a) if such twenty (20) consecutive Business Day period has not ended on or prior to
December 16, 2016, then it will not commence until January 3, 2017 and (b) November 23, 2016 and November 25, 2016 shall not constitute Business Days for purposes of
calculating the twenty (20) consecutive Business Day (
provided
that, for the avoidance of doubt, such exclusion shall not restart such period,
except with respect to clause (iii) above, in which case such ten (10) consecutive Business Day period referenced in clause (iii) above shall restart but, for the avoidance of
doubt, such twenty (20) consecutive Business Day period shall not restart);
provided
,
further
,
that, notwithstanding anything in this definition to the contrary, the Marketing Period shall not commence or be deemed to have commenced if, after the date hereof and prior to the completion of such
twenty (20) consecutive Business Day period, (A) KPMG LLP shall have withdrawn its audit opinion with respect to any financial statements included in the Required Information, in
which case the Marketing
Period shall not be deemed to commence unless and until, at the earliest, a new unqualified audit opinion is issued with respect to the audited financial statements of the Company for the applicable
periods by KPMG LLP or another independent public accounting firm of recognized national standing reasonably acceptable to Parent, (B) the Company or any of its subsidiaries shall have
publicly announced any intention to restate any historical financial statements included in the Required Information or that any such restatement is under consideration, in which case the Marketing
Period shall not be deemed to commence unless and until, at the earliest, such restatement has been completed and the applicable Required Information has been amended and made available to its
security holders or the Company has announced that it has concluded that no restatement shall be required in accordance with GAAP, or (C) any Required Information would not be Compliant at any
time during such twenty (20) consecutive Business Day period (it being understood that if any Required Information provided at the commencement of the Marketing Period ceases to be Compliant
during such twenty (20) consecutive Business Day period, then the Marketing Period shall be deemed
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not
to have occurred and must restart at such time when the Required Information is Compliant) or otherwise does not include the "Required Information" as defined; and
provided
,
further
, that the Marketing Period shall not begin earlier than (x) November 14,
2016, if, but for this proviso, it would begin during the period of September 15, 2016 through November 13, 2016 and (y) April 30, 2017, if, but for this proviso, it would
begin during the period of February 1, 2017 through April 29, 2017.
"
Merger
" has the meaning set forth in the Recitals.
"
Merger Consideration
" has the meaning set forth in
Section 2.1(a)(i)
.
"
Merger Sub
" has the meaning set forth in the Preamble.
"
Multiemployer Plan
" has the meaning set forth in
Section 3.9(a)
.
"
Multiple Employer Plan
" has the meaning set forth in
Section 3.9(a)
.
"
Nasdaq
" means The Nasdaq Stock Market LLC.
"
New Plans
" has the meaning set forth in
Section 5.5(b)
.
"
Old Plans
" has the meaning set forth in
Section 5.5(b)
.
"
Parent
" has the meaning set forth in the Preamble.
"
Parent Approvals
" has the meaning set forth in
Section 4.2(b)
.
"
Parent Material Adverse Effect
" has the meaning set forth in
Section 4.1
.
"
Parent Parties
" has the meaning set forth in the Preamble.
"
Parent Termination Fee
" has the meaning set forth in
Section 7.4(a)
.
"
Paying Agent
" has the meaning set forth in
Section 2.2(a)
.
"
Permitted Lien
" means a Lien (a) for Taxes or governmental assessments, charges or claims of payment not yet due, being contested
in good faith or for which adequate accruals or reserves have been established, (b) that is a carriers', warehousemen's, mechanics', materialmen's, repairmen's or other similar lien arising in
the ordinary course of business, (c) that is a zoning, entitlement or other land use or environmental regulation by any Governmental Entity that does not materially interfere with the use,
operation or transfer of, or any of the benefits of ownership of, the property of the Company and its Subsidiaries taken as a whole, (d) that is disclosed on the most recent consolidated
balance sheet of the Company or notes thereto, and (e) exclusive licenses of Intellectual Property entered into in the ordinary course of business.
"
Person
" means an individual, a corporation, a partnership, a limited liability company, an association, a trust or any other entity,
group (as such term is used in Section 13 of the Exchange Act) or organization, including a Governmental Entity, and any permitted successors and assigns of such person.
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"
Preferred Stock
" has the meaning set forth in
Section 3.2(a)
.
"
Proxy Statement
" has the meaning set forth in
Section 3.12
.
"
Qualifying Transaction
" has the meaning set forth in
Section 7.3(a)
.
"
Real Property
" has the meaning set forth in
Section 3.15
.
"
Required Amount
" has the meaning set forth in
Section 4.5(c)
.
"
Required Information
" means all financial statements, financial data, audit reports and other information of or regarding the Company and
its subsidiaries (i) of the type required by Regulation S-X and Regulation S-K under the Securities Act for a registered public offering of debt securities on Form S-1, but
limited to the type and form customarily included in a preliminary offering memorandum for debt securities under Rule 144A of the Securities Act (it being understood none of such information
need include (a) any statements or information required by Rules 3-09, 3-10 or 3-16 of Regulation S-X or for any period prior to January 1, 2013 and (b) other
information customarily excluded from an offering memorandum used for an offering of high yield debt securities pursuant to Rule 144A of the Securities Act), to consummate the offering of
nonconvertible debt securities by a large accelerated filer contemplated by the Debt Financing Commitments, assuming that such offering were consummated at the same time during the Company's fiscal
year as such offering of debt securities will be made, (ii) as otherwise reasonably required in connection with the Debt Financing and customarily included in private placements of debt
securities under Rule 144A of the Securities Act or (iii) as otherwise necessary in order to assist in receiving customary "comfort" (including as to customary change period "negative
assurance" comfort) from the independent accounts of the Company and its subsidiaries in connection with the offering of debt securities contemplated by the Debt Financing Commitments, including the
historical consolidated financial statements of the Company required to be delivered pursuant to paragraph 5 of Exhibit D of the Debt Commitment Letter; it being understood and agreed
that such information shall not include pro forma financial information, which shall be the responsibility of the Parent Parties; provided that, notwithstanding the Company's obligation to provide
assistance pursuant to
Section 5.16
, any pro forma financial statements or pro forma financial information to be included in such offering
documents shall not be considered "Required Information".
"
Recommendation
" has the meaning set forth in
Section 3.3(a)
.
"
Recoverable Amounts
" has the meaning set forth in
Section 7.4(b)
.
"
Related Parties
" has the meaning set forth in
Section 8.15
.
"
Representatives
" has the meaning set forth in
Section 5.2(a)
.
"
Sarbanes-Oxley Act
" means the Sarbanes-Oxley Act of 2002, as amended.
"
SEC
" means the Securities and Exchange Commission.
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"
Section 409A
" has the meaning set forth in
Section 3.9(f)
.
"
Securities Act
" means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
"
Share
" has the meaning set forth in
Section 2.1(a)(i)
.
"
Specified Approvals
" has the meaning set forth in
Section 3.3(a)
.
"
Specified Persons
" has the meaning set forth in
Section 7.4(b)
.
"
Subsidiaries
" means, with respect to any party, any corporation, partnership, association, trust or other form of legal entity of which
(a) more than 50% of the outstanding voting securities are on the date
hereof directly or indirectly owned by such party, or (b) such party or any Subsidiary of such party is a general partner (excluding partnerships in which such party or any Subsidiary of such
party does not have a majority of the voting interests in such partnership).
"
Superior Proposal
" has the meaning set forth in
Section 5.3(f)
.
"
Superior Proposal Notice
" has the meaning set forth in
Section 5.3(c)(ii)
.
"
Superior Proposal Notice Period
" has the meaning set forth in
Section 5.3(c)(ii)
.
"
Surviving Corporation
" has the meaning set forth in
Section 1.1
.
"
Takeover Laws
" has the meaning set forth in
Section 3.21
.
"
Tax Return
" has the meaning set forth in
Section 3.13(h)
.
"
Taxes
" has the meaning set forth in
Section 3.13(h)
.
"
Termination Date
" has the meaning set forth in
Section 5.1(a)
.
"
Transaction Litigation
" has the meaning set forth in
Section 5.12
.
"
Unvested Option
" has the meaning set forth in
Section 2.3(a)(ii)
.
"
Unvested RSU
" has the meaning set forth in
Section 2.3(b)(ii)
.
"
Vested Option
" has the meaning set forth in
Section 2.3(a)(i)
.
"
Vested RSU
" has the meaning set forth in
Section 2.3(b)(i)
.
"
Voting Agreement
" has the meaning set forth in the Recitals.
"
WARN
" means the Worker Adjustment Retraining Notification Act of 1988, as amended, or any similar Law.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered as of the date first above written.
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GENESYS TELECOMMUNICATIONS LABORATORIES, INC.
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By:
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/s/ NICK GEROSTATHOS
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Name:
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Nick Gerostathos
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Title:
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CFO
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GIANT MERGER SUB INC.
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By:
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/s/ MARK ALLOY
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Name:
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Mark Alloy
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Title:
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President
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INTERACTIVE INTELLIGENCE GROUP, INC.
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By:
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/s/ DONALD E. BROWN
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Name:
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Donald E. Brown
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Title:
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CEO
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[
Signature Page to Merger Agreement
]
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Table of Contents
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Solely for the purpose of Section 5.16:
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GREENEDEN LUX 3 S.ÀR.L.
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By:
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/s/ SÉVERINE MICHEL
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Name:
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Séverine Michel
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Title:
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Manager
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GREENEDEN U.S. HOLDINGS I, LLC
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By:
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/s/ NICK GEROSTATHOS
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Name:
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Nick Gerostathos
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Title:
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CFO
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GREENEDEN U.S. HOLDINGS II, LLC
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By:
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/s/ NICK GEROSTATHOS
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Name:
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Nick Gerostathos
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Title:
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CFO
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[
Signature Page to Merger Agreement
]
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Table of Contents
Annex B
VOTING AGREEMENT
This VOTING AGREEMENT (this "
Agreement
"), is dated as of August 30, 2016, by and
between Genesys Telecommunications Laboratories, Inc., a California corporation ("
Parent
") and Donald E. Brown, M.D. (the
"
Shareholder
"), a shareholder of Interactive Intelligence Group, Inc., an Indiana corporation (the
"
Company
"). Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Merger Agreement as of
the date hereof.
W
I T N E S S E T H:
WHEREAS,
Parent, Giant Merger Sub Inc., an Indiana corporation and a direct, wholly owned subsidiary of Parent ("
Merger Sub
"), and
the Company entered into an Agreement and Plan of Merger, dated as of August 30, 2016 (the "
Merger Agreement
"), providing for, among other things
and subject to the terms and conditions of the Merger Agreement, the merger of Merger Sub with and into the Company (the "
Merger
"), with the Company
surviving the Merger.
WHEREAS,
as of the date hereof, the Shareholder is the beneficial owner of that number of shares of Common Stock set forth in
Section 2.2
below (together with such additional shares of Common Stock that
become beneficially owned (within the meaning of Rule 13d-3
promulgated under the Exchange Act) by such Shareholder, whether upon the exercise of options, conversion of convertible securities or otherwise, after the date hereof, the
"
Owned Shares
").
WHEREAS,
as a condition to Parent's willingness to enter into and perform its obligations under the Merger Agreement, Parent has required that the Shareholder agree, and the Shareholder
has agreed, to enter into this Agreement.
NOW,
THEREFORE, in consideration of the premises and for other good and valuable consideration given to each party hereto, the receipt of which is hereby acknowledged, the parties agree
as follows:
1.
Agreement to Vote; Irrevocable Proxy
.
1.1
Agreement to Vote
. The Shareholder hereby irrevocably and unconditionally agrees that, from the date hereof
until the earlier of (i) the time that the Company Shareholder Approval has been obtained and (ii) termination of this Agreement in accordance with
Section 5.1
hereof (the "
Voting Period
"), at any meeting of the shareholders of the Company at
which the approval and adoption of the Merger Agreement and the transactions contemplated thereby is to be voted upon, however called, or any adjournment or postponement thereof, the Shareholder shall
be present (in person or by proxy) and vote (or cause to be voted), to the extent entitled to vote thereon, all of such party's Owned Shares at such time (a) in favor of approval and adoption
of the Merger Agreement and the transactions contemplated thereby, including the Merger and (b) against (A) any Alternative Proposal, (B) any extraordinary dividend or
distribution by the Company, (C) any material change in the capital structure of the Company or any Subsidiary of the Company, (D) any merger agreement or merger (other than the Merger
Agreement), consolidation, combination, material business transaction, sale of assets, reorganization, recapitalization, dissolution, liquidation or winding up of the Company, or any other action or
transaction involving the Company, and (E) any amendment of the Company's organizational documents that, in the case of (C), (D) or (E), would or would reasonably be expected to impair
the
ability of Parent or Merger Sub to complete the Merger, or that would or would reasonably be expected to prevent, impede or delay the consummation of the Merger. Notwithstanding anything herein to the
contrary, this
Section 1.1
shall not require the Shareholder to be present (in person or by proxy) or vote (or cause to be voted) any of the
Owned Shares to amend the Merger Agreement or take any action that could result in the amendment or modification, or a waiver of a
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Table of Contents
provision
therein, in any such case, in a manner that (i) decreases the amount or changes the form of the Merger Consideration, (ii) imposes any material restrictions on or additional
conditions on the payment of the Merger Consideration to shareholders or (iii) extends the End Date. For the avoidance of doubt, the Shareholder agrees that the obligations specified in this
Section 1.1
shall not be affected by (y) any Change of Recommendation or (z) any breach by the Company of any of such party's
representations, warranties, agreements or covenants set forth in the Merger Agreement.
1.2
Other Voting Rights
. Except as permitted by this Agreement, the Shareholder will continue to hold and shall
have the right to exercise all voting rights related to the Owned Shares.
1.3
Grant of Irrevocable Proxy
. The Shareholder hereby irrevocably appoints Parent and any designee of Parent,
and each of them individually, as such Shareholder's proxy and attorney-in-fact, with full power of substitution and resubstitution, to vote at any annual or special meeting of shareholders at which
any of the matters described in
Section 1.1
is to be considered during the Voting Period, with respect to the Owned Shares as of the applicable
record date, in each case solely to the extent and in the manner specified in
Section 1.1; provided, however
, that such Shareholder's grant of
the proxy contemplated by this
Section 1.3
shall be effective if, and only if, such Shareholder has not delivered to the Secretary of the
Company, at least two Business Days prior to the applicable meeting, a duly executed irrevocable proxy card directing that the Owned Shares be voted in accordance with
Section 1.1
. This proxy, if it
becomes effective, is given to secure the performance of the duties of such Shareholder under this Agreement, and its existence will not
be deemed to relieve such Shareholder of such party's obligations under
Section 1.1
. For Owned Shares as to which the Shareholder is the
beneficial but not the record owner, such Shareholder will use his reasonable best efforts to cause any record owner of such Owned Shares to grant to Parent a proxy to the same effect as that
contained in this
Section 1.3
.
2.
Representations and Warranties of Shareholder
. The Shareholder hereby represents and warrants to Parent as of
the date of this Agreement and as of the date of the Company Meeting as follows:
2.1
Power; Due Authorization; Binding Agreement
. This Agreement has been duly and validly executed and delivered
by such Shareholder and, assuming the due and valid authorization, execution and delivery hereof by the other parties hereto, constitutes a valid and binding agreement of such Shareholder, enforceable
against such Shareholder in accordance with its terms, except that (i) such enforcement may be subject to applicable bankruptcy, insolvency, reorganization, moratorium or other similar Laws,
now or hereafter in effect, relating to creditors' rights generally and (ii) equitable remedies of specific performance and injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.
2.2
Ownership of Shares
. On the date hereof, the Shareholder beneficially owns 3,827,448.56 Owned Shares, as
more particularly described on
Schedule 2.2
hereto. Other than restrictions in favor of Parent pursuant to this Agreement and except as set forth
on
Schedule 2.2
hereto and for such transfer restrictions of general applicability as may be provided under the Securities Act or the "blue sky"
Laws of the various states of the United States, and any restrictions contained in the organizational documents of the Company, as of the date hereof such Shareholder has, and at any shareholder
meeting of the Company held during the Voting Period, such Shareholder will have (except as otherwise permitted by this Agreement), sole voting power and sole dispositive power with respect to the
matters set forth in
Section 1.1
in respect of all of the then Owned Shares of such Shareholder.
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2.3
Acknowledgment
. The Shareholder understands and acknowledges that Parent is entering into the Merger
Agreement in reliance upon the Shareholder's execution, delivery and performance of this Agreement.
3.
Representations and Warranties of Parent
. Parent hereby represents and warrants to the Shareholder that
Parent has the requisite corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby. The execution
and delivery of this Agreement and the consummation by Parent of the transactions contemplated hereby have been duly and validly authorized by all necessary corporate action on the part of Parent, and
no other proceedings on the part of Parent are necessary to authorize this Agreement or to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and
delivered by Parent and, assuming the due and valid authorization, execution and delivery hereof by the other parties hereto, constitutes a valid and binding agreement of Parent.
4.
Certain Covenants of the Shareholder
.
4.1
Restriction on Transfer, Proxies and Non-Interference
. The Shareholder hereby agrees, during the Voting
Period, not to, directly or indirectly, (a) sell, transfer, pledge, encumber, assign or otherwise
dispose of, or enter into any contract, option or other arrangement or understanding with respect to the sale, transfer, pledge, encumbrance, assignment or other disposition of, or limitation on the
voting rights of, any of the Owned Shares (any such action, a "
Transfer
"), (b) grant any proxies or powers of attorney with respect to the Owned
Shares, or deposit any such Owned Shares into a voting trust or enter into a voting agreement with respect to any such Owned Shares, in each case with respect to any vote on the approval and adoption
of the Merger Agreement or any other matters set forth in
Section 1.1
of this Agreement, (c) subject to
Section 4.3
, make any public
statements that are inconsistent with the Shareholder's support of the Merger Agreement and the transactions
contemplated thereby or publicly propose to do any of the foregoing (
provided
that the foregoing shall in no event require such Shareholder to make any
public statements regarding the Merger Agreement and the transactions contemplated thereby), or (d) commit or agree to take any of the foregoing actions. If any involuntary Transfer of any of
the Owned Shares shall occur, the transferee (which term, as used herein, shall include any and all transferees and subsequent transferees of the initial transferee) shall, to the extent permitted by
applicable Law, take and hold such Owned Shares subject to all of the restrictions, liabilities and rights under this Agreement, which shall continue in full force and effect until the valid
termination of this Agreement.
4.2
Merger Agreement Obligations
. The Shareholder (solely in such Shareholder's capacity as such) agrees that
such party shall not, and shall not authorize or permit any investment banker, attorney or other advisor or representative retained by such Shareholder to act on such Shareholder's behalf to, directly
or indirectly, (i) solicit, initiate, knowingly facilitate, cooperate with, or knowingly encourage any inquiry with respect to, or the making, submission or announcement of, any offer that
constitutes, or could reasonably be expected to constitute, an Alternative Proposal, (ii) participate in any negotiations regarding an Alternative Proposal with, or furnish any nonpublic
information regarding an Alternative Proposal to, any Person that has made or, to the Shareholder's knowledge, is considering making, an Alternative Proposal, (iii) engage in discussions
regarding an Alternative Proposal with any Person that has made or, to the Shareholder's knowledge, is considering making an Alternative Proposal, except to notify such Person as to the existence of
the provisions of this
Section 4.2
, or (iv) enter into any letter of intent, agreement, contract or agreement in principle regarding an
Alternative Proposal;
provided
, that the foregoing shall not restrict the Shareholder from taking any action to the extent that the Company is permitted
to take such action pursuant to
Section 5.3
of the Merger Agreement.
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4.3
No Limitations on Actions
. Parent expressly acknowledges that the Shareholder is entering into this
Agreement solely in such party's capacity as the beneficial owner of the Owned Shares and this Agreement shall not (i) limit or otherwise affect the actions taken or not taken in his capacity
as a director or officer of the Company or (ii) prohibit, limit or otherwise restrict the Shareholder from exercising his fiduciary duties as a director or officer of the Company or its
subsidiaries. Parent shall not assert any claim that any action taken by the Shareholder in his capacity as a director or officer of the Company violates any provision of this Agreement.
5.
Miscellaneous
.
5.1
Termination of this Agreement
. This Agreement, and all obligations, terms and conditions contained herein,
shall automatically terminate without any further action required by any person upon the earliest to occur of: (i) the termination of the Merger Agreement in accordance with its terms;
(ii) the Effective Time; (iii) the making of any change, by amendment, waiver or other modification to any provision of the Merger Agreement that (x) decreases the amount or
changes the form of the Merger Consideration, (y) imposes any material restrictions on or additional conditions on the payment of the Merger Consideration to shareholders or (z) extends
the End Date; and (iv) the End Date.
5.2
Effect of Termination
. In the event of termination of this Agreement pursuant to
Section 5.1
, this Agreement shall
become void and of no effect with no liability on the part of any party hereto;
provided
,
however
, no such termination shall relieve any party hereto from
any liability for any breach
of this Agreement occurring prior to such termination and the provisions of this
Article 5
shall survive any such termination.
5.3
Entire Agreement; Assignment
. This Agreement constitutes the entire agreement between the parties with
respect to the subject matter hereof and supersedes all other prior agreements and understandings, both written and oral, between the parties with respect to the subject matter hereof. Other than as
set forth in
Section 5.4
, nothing in this Agreement, express or implied, is intended to or shall confer upon any person other than the parties
hereto any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement. This Agreement shall not be assigned by operation of law or otherwise and shall be binding upon and
inure solely to the benefit of each party hereto.
5.4
Amendments; Third Party Beneficiary
. This Agreement may not be modified, amended, altered or supplemented,
except upon the execution and delivery of a written agreement executed by each of the parties hereto. The parties hereto expressly agree that the Company is intended to, and shall, be a third party
beneficiary of the covenants and agreements of the parties hereto, which covenants and agreements shall not be amended, modified or waived without the prior written consent of the Company.
5.5
Notices
. Any notice required to be given hereunder shall be sufficient if in writing, and sent by email,
facsimile transmission, by reliable overnight delivery service (with proof of service), hand delivery or certified or registered mail (return receipt requested and first-class postage prepaid),
addressed as follows:
If
to the Shareholder:
Donald
E. Brown, M.D.
c/o Interactive Intellligence Group, Inc.
7601 Interactive Way
Indianapolis, IN 46278
Email: don.brown@inin.com
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with
a copy to:
Faegre
Baker Daniels LLP
600 East 96
th
Street, Suite 600
Indianapolis, IN 46240
Attention: J. Jeffrey Brown
Facsimile: (317) 569-4800
Email: jeff.brown@faegrebd.com
If
to the Company (prior to the Closing):
Interactive
Intelligence Group, Inc.
7601 Interactive Way
Indianapolis, IN 46278
Attention: Ashley A. Vukovits
Facsimile: (317) 715-8265
Email: ashley. vukovits @inin.com
with
a copy to:
Faegre
Baker Daniels LLP
600 East 96
th
Street, Suite 600
Indianapolis, IN 46240
Attention: J. Jeffrey Brown
Facsimile: (317) 569-4800
Email: jeff.brown@faegrebd.com
If
to Parent:
Genesys
Telecommunications Laboratories, Inc.
2001 Junipero Serra Blvd., 9th Floor
Daly City, CA 94014
Attn: James M. René
Telecopy No.: (650) 466-1260
Email: Jim.Rene@genesys.com
with
a copy to:
Fried,
Frank, Harris, Shriver & Jacobson LLP
801 17th Street, NW
Washington, DC 20006
Attention: Brian Mangino
Telecopy No.: (202)639-7003
Email: brian.mangino@friedfrank.com
and
Fried,
Frank, Harris, Shriver & Jacobson LLP
One New York Plaza
New York, NY 10004
Attention: Randi Lally
Telecopy No.: (212) 859-4000
randi.lally@friedfrank.com
or
to such other address as any party shall specify by written notice so given, and such notice shall be deemed to have been delivered (a) when received when sent by email or facsimile,
provided
that
the recipient confirms in writing receipt thereof, (b) upon proof of service when sent by reliable
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overnight
delivery service, (c) upon personal delivery in the case of hand delivery or (d) upon receipt of the return receipt when sent by certified or registered mail. Any party to this
Agreement may notify any other party of any changes to the address or any of the other details specified in this paragraph;
provided
,
however
, that such
notification shall only be effective on the date specified in such notice or two Business Days after the notice is given, whichever
is later. Rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was given shall be deemed to be receipt of the notice as of the date of such
rejection, refusal or inability to deliver.
5.6
Governing Law; Venue; Waiver of Jury Trial
.
(a) This
Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice or conflict of law provision
or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware. In addition, each of the parties
hereto irrevocably agrees that any legal action or proceeding with respect to this Agreement and the rights and obligations arising hereunder, or for recognition and enforcement of any judgment in
respect of this Agreement and the rights and obligations arising hereunder brought by the other party hereto or such party's successors or
assigns, shall be brought and determined exclusively in the state or federal courts of the State of Delaware. Each of the parties hereto hereby irrevocably submits with regard to any such action or
proceeding for itself and in respect of such party's property, generally and unconditionally, to the personal jurisdiction of the aforesaid courts and agrees that such party will not bring any action
relating to this Agreement or any of the transactions contemplated by this Agreement in any court other than the aforesaid courts. Each of the parties hereto hereby irrevocably waives, and agrees not
to assert as a defense, counterclaim or otherwise, in any action or proceeding with respect to this Agreement, (a) any claim that such party is not personally subject to the jurisdiction of the
above-named courts for any reason other than the failure to serve in accordance with this
Section 5.6
, (b) any claim that such party or
such party's property is exempt or immune from the jurisdiction of any such court or from any legal process commenced in such courts (whether through service of notice, attachment prior to judgment,
attachment in aid of execution of judgment, execution of judgment or otherwise) and (c) to the fullest extent permitted by the applicable Law, any claim that (i) the Action in such court
is brought in an inconvenient forum, (ii) the venue of such Action is improper or (iii) this Agreement, or the subject matter hereof, may not be enforced in or by such courts.
(b) EACH
OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY MAKES THIS WAIVER VOLUNTARILY AND SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS CONTAINED IN THIS
SECTION 5.6
.
5.7
Specific Performance; Exclusive Remedy
. The parties agree that, in the event of any breach or threatened
breach of any covenant or obligation contained in this Agreement, the parties would be irreparably harmed and that money damages would not provide an adequate remedy. Accordingly, each of the parties
agrees that the parties to this Agreement shall be entitled to seek and obtain (a) a decree or order of specific performance to enforce the observance and performance of such covenant or
obligation, and (b) an injunction restraining such breach or threatened breach. Each of the parties further agrees that no party shall be required to obtain, furnish or post any bond or similar
instrument in connection with or as a condition to obtaining any remedy referred to in this
Section 5.7
, and each party irrevocably waives any
right such party may have to require the obtaining, furnishing or posting of any such bond or similar instrument.
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Parent
hereby agrees that specific performance or injunctive relief pursuant to this
Section 5.7
shall be its sole and exclusive remedy with
respect to breaches or threatened breaches by the Shareholder in
connection with this Agreement, and neither Parent nor any of its Affiliates may pursue or accept any other form of relief (including monetary damages) that may be available for breach of this
Agreement.
5.8
Counterparts
. This Agreement may be executed in one or more counterparts, all of which shall be considered
one and the same instrument and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties. This Agreement may be executed by
facsimile or electronic transmission signature and a facsimile or electronic transmission signature shall constitute an original for all purposes.
5.9
Descriptive Headings
. The descriptive headings used herein are inserted for convenience of reference only
and are not intended to be part of or to affect the meaning or interpretation of this Agreement.
5.10
Severability
. Any term or provision of this Agreement that is invalid or unenforceable in any jurisdiction
shall, as to that jurisdiction, be ineffective to the sole extent of such invalidity or unenforceability without rendering invalid or unenforceable the remainder of such term or provision or the
remaining terms and provisions of this Agreement in any jurisdiction. If any provision of this Agreement is so broad as to be unenforceable, such provision shall be interpreted to be only so broad as
is enforceable.
[
remainder of page intentionally blank
]
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IN WITNESS WHEREOF, the parties hereto have caused this Voting Agreement to be duly executed as of the day and year first above written.
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PARENT
:
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GENESYS TELECOMMUNICATIONS LABORATORIES, INC.
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By:
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/s/ NICK GEROSTATHOS
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Name:
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Nick Gerostathos
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Title:
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CFO
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SHAREHOLDER
:
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/s/ DONALD E. BROWN
Donald E. Brown, M.D.
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SIGNATURE
PAGE TO VOTING AGREEMENT
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SCHEDULE 2.2
As of the date hereof, Donald E. Brown beneficially owns the following shares of the Company's Common
Stock:
-
-
Shares held directly by Donald E. Brown: 3,327,269 shares
-
-
Shares held by Donald E. Brown in the Company's 401(k) Plan: 179.56 shares
-
-
Shares held by Donald E. Brown, Trustee u/a Donald E. Brown 2014 Grantor Retained Annuity Trust u/a dated September 25,
2014191,561 shares (the "2014 GRAT")
-
-
Donald E. Brown is the trustee of the 2014 GRAT
-
-
The 2014 GRAT is scheduled to terminate on October 27, 2016. If the Company's stock price exceeds $62.645 on such
date, a portion of the above shares will transfer on that date to trusts for the benefit of Mr. Brown's eight children. Karen Evans is the trustee of each of those trusts. If the Company's
stock price does not exceed $62.645 on such date, the shares of Common Stock will transfer on that date to Mr. Brown.
-
-
Shares held by Donald E. Brown, Trustee u/a Donald E. Brown 2015 Grantor Retained Annuity Trust u/a dated November 6,
2015308,439 shares (the "2015 GRAT")
-
-
Donald E. Brown is the trustee of the 2015 GRAT
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Annex C
August 30,
2016
Interactive
Intelligence Group Inc.
7601 Interactive Way
Indianapolis, IN, 46278
Members
of the Independent Committee of the Board of Directors and the Board of Directors:
We
understand that Interactive Intelligence Group Inc. (the "Company") and Genesys Telecommunications Laboratories, Inc. (the "Acquiror") propose to enter into an Agreement
and Plan of Merger, to be dated as of August 30, 2016 (the "Agreement"), pursuant to which the Acquiror will acquire the Company by means of a merger of a wholly-owned subsidiary of the
Acquiror ("Merger Sub") with and into the Company (the "Transaction"). Pursuant to the Transaction, each share of common stock of the Company, par value $0.01 per share ("Company Common Stock"),
outstanding immediately prior to the Effective Time (as defined in the Agreement), other than any such shares owned by the Acquiror, Merger Sub or the Company, or by any direct or indirect subsidiary
of the Acquiror, Merger Sub or the Company (collectively, the "Excluded Shares"), will be converted into the right to receive $60.50 in cash (the "Merger Consideration"), subject to the terms and
conditions of the Agreement. The terms and conditions of the Transaction are more fully set forth in the Agreement. All capitalized terms that are used but not defined herein shall have the respective
meanings ascribed thereto in the Agreement.
You
have asked for our opinion as to whether, as of the date hereof, the Merger Consideration to be received by the holders of Company Common Stock (other than the Excluded Shares) in
the proposed Transaction is fair, from a financial point of view, to such holders of shares of the Company Common Stock.
In
connection with rendering our opinion set forth herein, we have:
-
(i)
-
Reviewed
the draft of the Agreement presented to the Board of Directors at its meeting on August 30, 2016, and drafts of certain related documents,
including certain debt financing commitments, dated as of August 20, 2016, and a voting agreement between Acquiror and a shareholder of the Company dated as of August 30, 2016, 2016,
which we assume are in substantially final form and the executed copies of which will not vary in any respect material to our analysis (collectively, the "Transaction Agreements");
-
(ii)
-
Reviewed
certain publicly available financial statements and other business and financial information of the Company;
-
(iii)
-
Reviewed
certain internal financial statements and other financial and operating data concerning the Company;
-
(iv)
-
Reviewed
certain financial projections and forecasts prepared by the management of the Company (collectively, the "Company Projections");
-
(v)
-
Reviewed
certain financial projections and forecasts prepared by Wall Street research analysts regarding the Company;
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(vi)
-
Discussed
the past and current operations and financial condition of the Company, as well as the prospects of the Company, with senior executives of the
Company;
-
(vii)
-
Reviewed
the reported prices and trading activity for the Company Common Stock;
-
(viii)
-
Compared
the financial performance of the Company and trading activity of the Company Common Stock with that of certain other publicly traded companies
comparable with the Company and its securities;
-
(ix)
-
Reviewed
the financial terms, to the extent publicly available, of certain comparable acquisition transactions and compared the proposed financial terms of
the Transaction with the financial terms of such comparable acquisition transactions;
-
(x)
-
Participated
in discussions and negotiations among representatives of the Company and the Acquiror and their financial and legal advisors; and
-
(xi)
-
Performed
such other analyses and considered such other factors as we have deemed appropriate.
For
purposes of conducting our analysis of the Transaction and rendering our opinion herein, we have assumed and relied upon, without undertaking any responsibility for independent
verification of, the accuracy and completeness of the information publicly available, supplied or otherwise made available to, discussed with, or reviewed by us, and assume no liability therefor. We
have further relied upon the assurances of the management of the Acquiror and the Company, respectively, that they are not aware of any facts that would make such information inaccurate or misleading.
With respect to the financial forecasts of the Company provided to us by management of the Company, for purposes of our opinion, we have assumed that such Company Projections have been reasonably
prepared on a basis reflecting the best currently available estimates and good faith judgments of the management of the Company as to the future competitive, operating and regulatory environments and
related financial performance of the Company. We express no opinion with respect to such Company Projections or other financial forecasts or the assumptions on which they are based.
For
purposes of rendering our opinion herein, we have also assumed, with your consent, that the representations and warranties of each party set forth in the Transaction Agreements are
true and correct, that each party to the Transaction Agreements will perform all of the covenants and agreements required to be performed by it thereunder and that all conditions to the consummation
of the Transaction will be satisfied without waiver or modification thereof, except, in each case, as would not be material to our analyses. We have further assumed that all governmental, regulatory
or other consents, approvals or releases necessary for the consummation of the Transaction will be obtained without any delay, limitation, restriction or condition that would, in any respect material
to our analysis, have an adverse effect on the Acquiror, the Company or the consummation of the Transaction. We have assumed that any modification to the structure of the Transaction will not vary in
any respect material to our analysis. We are not legal, regulatory, accounting or tax experts and have assumed, without independent verification and with your permission, the accuracy and completeness
of assessments by the Company and its advisors with respect to legal, regulatory, accounting and tax matters.
Our
opinion is necessarily based on economic, market and other conditions as in effect on the date hereof, as well as the information publicly available, supplied or otherwise made
available to us as of the date hereof. It is understood that subsequent developments may affect this opinion, including those related to the Company's operations as well as new initiatives and
transactions, and that we do not have or undertake any obligation to update, revise or reaffirm our opinion set forth herein.
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We
have not made, nor assumed any responsibility for making, any valuation or appraisal of any assets or liabilities of the Acquiror or the Company, and no such valuations or appraisals
have been provided to us. We have not been asked to pass upon, and express no opinion with respect to, any matter other than the fairness from a financial point of view, as of the date hereof, of the
Merger Consideration to be received by the holders of Company Common Stock (other than the Excluded Shares) in the proposed Transaction, and we express no opinion with respect to the fairness of the
Transaction to, or any consideration received in connection therewith by, the holders of any other class of securities, creditors or other constituencies of the Company. Our opinion does not address
the relative merits of the Transaction as compared to other business or financial strategies that might be available to the Company, nor does it address the underlying business decision of the Company
to engage in the Transaction, and as such is not intended to be and does not constitute a recommendation to the Board of Directors of the Company as to whether it should approve the Transaction, the
Agreement or any related matters. We also express no opinion with respect to the amount or nature of any compensation to any directors, officers or other employees of the Company, or any class of such
persons, relative to the consideration to be received by the holders of Company Common Stock (other than the Excluded Shares) in the Transaction pursuant to the Agreement or with respect to the
fairness of any such compensation.
We
have acted as financial advisor to the Board of Directors with respect to the proposed Transaction and will receive a fee from the Company for our services, the principal portion of
which is contingent upon consummation of the Transaction. The Company has agreed to reimburse our reasonable expenses and to indemnify us against certain liabilities arising out of our engagement in
connection with the Transaction. During the two-year period prior to the date hereof, we have not provided financial advisory services to the Company other than in connection with the Transaction.
During the same two year period, we have provided financial advisory services to certain affiliates of Permira Advisors LLC ("Permira") and received fees for these services. We understand that
certain affiliated funds of Permira are significant shareholders of the Acquiror. We may also seek to provide such services to the Company, the Acquiror and Permira and its affiliates in the future
and expect to receive fees for the rendering of these services.
In
the ordinary course of business, we, our successors, our affiliates and our directors and officers may trade securities of the Acquiror or the Company for our own accounts and the
accounts of our customers and, accordingly, may at any time hold a long or short position in such securities.
In
addition, we, our affiliates, directors or officers, including individuals working with the Company in connection with this Transaction, may have committed and may commit in the
future to invest in private equity funds managed by the principal stockholders of the Acquiror.
It
is understood that this letter and the opinion set forth herein is for the information of the Board of Directors in connection with and for the purposes of the Independent Committee's
evaluation and recommendation of the Transaction to the full Board of Directors, and the Board's evaluation of the Transaction, and may not be used or relied upon by any other person or body or for
any other purpose; provided, however, that the opinion may be summarized in a manner reasonably acceptable to us in the proxy statement for the Transaction and may be included in its entirety in any
filing the Company is required to make with the Securities and Exchange Commission in connection with the Transaction if such inclusion is required by applicable law. Our opinion does not constitute a
recommendation to any shareholder of the Company as to how such shareholder should vote with respect to the Transaction or any other matter. Except as otherwise provided above, this opinion may not be
disclosed, quoted, referred to or communicated (in whole or in part) to any third party for any purpose whatsoever except with our prior written consent. This opinion has been approved by our fairness
committee.
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Based
upon and subject to the foregoing, it is our opinion that as of the date hereof, the Merger Consideration to be received by the holders of Company Common Stock (other than the
Excluded Shares) in the proposed Transaction is fair, from a financial point of view, to such holders of Company Common Stock.
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Very best regards,
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UNION SQUARE ADVISORS LLC
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/s/ UNION SQUARE ADVISORS LLC
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