Item 1.01 Entry into a Material Definitive Agreement
On December 24, 2019, in connection with the Merger (as defined below),
Carbonite, Inc., a Delaware corporation (the "Company"), entered into a first
supplemental indenture, dated as of December 24, 2019 (the "Supplemental
Indenture"), with U.S. Bank National Association, as trustee (the "Trustee"), to
the Indenture dated as of April 4, 2017 between the Company, as issuer, and the
Trustee, relating to the Company's 2.50% Convertible Senior Notes due 2024 (the
"Notes") (as supplemented by the Supplemental Indenture, the "Indenture"). The
Supplemental Indenture provides that, at and after the effective time of the
Merger, the right to convert each $1,000 principal amount of the Notes will be
changed into the right to convert such principal amount of the Notes solely into
cash in an amount equal to the Conversion Rate (as defined in the Indenture) in
effect on the Conversion Date (as defined in the Indenture) (as may be increased
by any additional shares pursuant to Section 14.03 of the Indenture) multiplied
by $23.00.
The foregoing is only a brief description of the Supplemental Indenture and is
qualified in its entirety by reference to the Supplemental Indenture, a copy of
which is filed as Exhibit 4.1 to this Current Report on Form 8-K.
Item 1.02 Termination of a Material Definitive Agreement
Credit Agreement
In connection with the completion of the Merger (as defined below), on
December 24, 2019, the Company terminated its credit agreement (the "Credit
Agreement"), dated March 26, 2019, with Barclays Bank PLC as administrative
agent and certain other lenders. In connection with such termination, the
Company paid Barclays Bank PLC approximately $469.95 million in aggregate
principal, interest and fees that were outstanding and payable under the Credit
Agreement at the time of its termination, and all liens on assets of the Company
and its subsidiaries guaranteeing such facility, together with such subsidiary
guarantees, were released and terminated. The Company incurred no early
termination penalty in connection with termination of the Credit Agreement. The
material terms of the Credit Agreement are described in the Current Report on
Form 8-K filed by the Company with the U.S. Securities and Exchange Commission
(the "SEC") on March 26, 2019. Such description is incorporated herein by
reference.
Item 2.01 Completion of Acquisition or Disposition of Assets.
As previously announced, on November 10, 2019, Open Text Corporation, a
corporation incorporated under the federal laws of Canada ("OpenText") and Coral
Merger Sub Inc., a Delaware corporation and a wholly-owned subsidiary of
OpenText ("Purchaser"), entered into an Agreement and Plan of Merger (the
"Merger Agreement") with the Company. Pursuant to the Merger Agreement, and on
the terms and subject to the conditions thereof, Purchaser commenced a tender
offer on November 25, 2019 to acquire all of the outstanding shares of common
stock, par value $0.01 per share, of the Company (each, a "Share") at a purchase
price of $23.00 per Share in cash, without interest and net of applicable
withholding of taxes (the "Offer Price"), upon the terms and conditions set
forth in the Offer to Purchase dated November 25, 2019 (as amended or
supplemented, the "Offer to Purchase"), and in the related Letter of Transmittal
(as amended or supplemented, the "Letter of Transmittal" and together with the
Offer to Purchase, the "Offer").
On December 24, 2019, OpenText announced that the Offer expired at one minute
after 11:59 P.M., Eastern time, on December 23, 2019 (the "Expiration Time").
The Depositary (as defined in the Offer to Purchase) has advised OpenText and
Purchaser that immediately prior to the Expiration Time there were validly
tendered and not withdrawn (and excluding any Shares tendered pursuant to
guaranteed delivery procedures that have not yet been "received" (as defined in
Section 251(h)(6)(f) of the Delaware General Corporation Law (the "DGCL")), a
total of 28,703,509 Shares. The validly tendered Shares represent approximately
81.51% of the Shares outstanding immediately prior to the Expiration Time. In
addition, notices of guaranteed delivery have been delivered with respect to
3,482,105 Shares. The number of Shares (excluding Shares tendered pursuant to
guaranteed delivery procedures that have not yet been "received" (as defined in
Section 251(h)(6)(f) of the DGCL)) tendered into the Offer satisfied the Minimum
Condition (as defined in the Merger Agreement) immediately prior to the
Expiration Time. All conditions to the Offer have been satisfied or waived.
Purchaser has accepted for payment all Shares that were validly tendered
pursuant to the Offer and not withdrawn prior to the Expiration Time.
On December 24, 2019, following the expiration of the Offer and acceptance for
payment of the Shares tendered pursuant to the Offer, OpenText completed its
acquisition of the Company pursuant to the terms of the Merger Agreement.
. . .
Item 2.04 Triggering Events That Accelerate or Increase a Direct Financial
Obligation or an Obligation under an Off-Balance Sheet Arrangement.
The disclosures under Item 1.01 and Item 8.01 are incorporated herein by
reference.
Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or
Standard; Transfer of Listing.
As a result of the transactions described in Item 2.01 of this Current Report on
Form 8-K, the Company no longer fulfills the numerical listing requirements of
Nasdaq. Accordingly, on December 24, 2019, (i) the Company requested that Nasdaq
suspend trading of the Shares effective at the close of business on December 24,
2019, (ii) the Company notified Nasdaq of its intent to remove its Shares from
listing on Nasdaq, and (iii) Nasdaq filed with the SEC a Notification of Removal
from Listing and/or Registration under Section 12(b) of the Exchange Act, on
Form 25 to delist and deregister the Shares. The delisting will become effective
ten days after the filing of the Form 25. The Company also intends to file with
the SEC a certification on Form 15 under the Exchange Act requesting
deregistration of the Shares and the suspension of the Company's reporting
obligations under Sections 13(a) and 15(d) of the Exchange Act and
deregistration of its Shares under Section 12(g) of the Exchange Act.
The information set forth or incorporated by reference in Item 2.01 of this
Current Report on Form 8-K is incorporated by reference into this Item 3.01.
Item 3.03 Material Modifications to Rights of Security Holders.
The information set forth or incorporated by reference in Items 2.01, 3.01 and
5.01 of this Current Report on Form 8-K is incorporated by reference into this
Item 3.03.
Item 5.01 Changes in Control of Registrant.
As a result of the completion of the Offer, a change in control of the Company
occurred. Upon the consummation of the Merger, the Company became a wholly-owned
subsidiary of OpenText. The total merger consideration paid in connection with
the Offer and the Merger was approximately $894.19 million.
The information set forth or incorporated by reference in Items 2.01, 3.01,
3.03, 5.02 and 5.03 of this Current Report on Form 8-K is incorporated by
reference into this Item 5.01.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
In accordance with the terms of the Merger Agreement and effective as of the
Effective Time on December 24, 2019, Stephen Munford, David Friend, Todd
Krasnow, Scott Daniels, Charles Kane, Marina Levinson and Linda Connly resigned
as members of the Company's Board of Directors and Gordon A. Davies and Madhu
Ranganathan, the directors of Purchaser immediately prior to the Effective Time,
became the directors of the Company. At the time Mr. Davies and Ms. Ranganathan
assumed the roles of directors, it had not yet been determined on which
committees, if any, of the Company's Board of Directors each of them would
serve.
In addition, effective as of the Effective Time on December 24, 2019, the
Company removed Stephen Munford as Interim Chief Executive Officer and
President, Anthony Folger as Chief Financial Officer, John Post as Chief
Operating Officer, Chad Bacher as Chief Product Officer, Hal Lonas as Chief
Technology Officer, Craig Stilwell as Chief Revenue Officer, Cassandra Hudson as
Vice President of Finance and Chief Accounting Officer and Paul Mellinger as
Senior Vice President of Global Sales; and the Company appointed Madhu
Ranganathan as President and Treasurer, and Gordon Davies as Secretary.
Information about Mr. Davies and Ms. Ranganathan is contained in the Offer to
Purchase, filed as Exhibit (a)(l)(A) to the Tender Offer Statement on Schedule
TO originally filed by OpenText and Purchaser with the SEC on November 25, 2019,
which is included as Exhibit 20.1 to this Current Report on Form 8-K and
incorporated herein by reference into this Item 5.02.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year.
Pursuant to the terms of the Merger Agreement, the Company's certificate of
incorporation and bylaws were amended and restated in their entirety, effective
as of the Effective Time. Copies of the Company's amended and restated
certificate of incorporation and amended and restated bylaws are included as
Exhibit 3.1 and 3.2, respectively, to this Current Report on Form 8-K and are
incorporated herein by reference.
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Item 7.01 Regulation FD Disclosure.
On December 24, 2019, OpenText issued a press release (the "Press Release")
regarding the matters described in this Current Report on Form 8-K. A copy of
the Press Release was filed as Exhibit (a)(5)(M) to Amendment 5 to the Schedule
TO filed by OpenText on December 26, 2019. The Press Release is incorporated by
reference into this Item 7.01, and the foregoing description of the Press
Release is qualified in its entirety by the full text of the Press Release. The
information in this Item 7.01 (and in the Press Release) is being furnished to,
and shall not be deemed "filed" with, the SEC for purposes of the Section 18 of
the Exchange Act. The website addresses of OpenText and the Company are included
in the Press Release as inactive textual references only. The information
contained on these websites is not part of the Press Release and shall not be
deemed furnished to the SEC.
Item 8.01 Other Events.
The description contained in Item 1.01 of this Current Report on Form 8-K is
hereby incorporated by reference in its entirety into this Item 8.01.
The consummation of the Merger constitutes a Fundamental Change, a Make-Whole
Fundamental Change and a Specified Corporate Event under the Indenture (each, as
defined in the Indenture). Accordingly, the effective date of the Fundamental
Change and the Specified Corporate Event and the Effective Date (as defined in
the Indenture) of the Make-Whole Fundamental Change is December 24, 2019. The
Indenture provides that, as a result of the Fundamental Change, and subject to
the terms of the Indenture, each holder of the Notes will have the right to
require the Company to purchase such holder's Notes for cash at a repurchase
price equal the principal amount of such Notes plus accrued and unpaid interest
thereon to, but excluding, the repurchase date designated by the Company (the
"Fundamental Change Repurchase Date") in a notice to the holders of the Notes
and the Trustee (the "Fundamental Change Company Notice"), which Fundamental
Change Repurchase Date will be not less than 20 or more than 35 calendar days
following the date of delivery of the Fundamental Change Company Notice.
Alternatively, as a result of the Make-Whole Fundamental Change, and subject to
the terms of the Indenture, each holder of the Notes will have the right to
surrender such holder's Notes for conversion at any time from and after
December 24, 2019 and until 5:00 p.m., New York City time, on the Business Day
(as defined in the Indenture) immediately preceding the Fundamental Change
Repurchase Date (such period, the "Make-Whole Fundamental Change Period").
Holders who convert their Notes during the Make-Whole Fundamental Change Period
will be entitled to convert their Notes at an increased Conversion Rate as
provided in Section 14.03 of the Indenture. Pursuant to Section 14.03 of the
Indenture, the Conversion Rate applicable to Notes that are surrendered for
conversion during the Make-Whole Fundamental Change Period, will be increased by
7.7633 per $1,000 principal amount of Notes to yield a Conversion Rate of
38.7034 per $1,000 principal amount of Notes. Accordingly, the total amount of
conversion consideration to be paid for each $1,000 principal amount of Notes
surrendered for conversion during the Make-Whole Fundamental Change Period is
expected to be $1,068.7341 in cash. In accordance with the Indenture, the
Company will provide the Fundamental Change Company Notice on or before the 20th
Business Day after the occurrence of the Merger.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit
No. Description
2.1 Agreement and Plan of Merger, dated as of November 10, 2019, by
and among Open Text Corporation, Coral Merger Corp., Inc. and
Carbonite, Inc. (incorporated by reference to Exhibit 2.1 to the
Current Report on Form 8-K filed by Carbonite, Inc. on November 12,
2019)
3.1 Ninth Amended and Restated Certificate of Incorporation of
Carbonite, Inc.
3.2 Amended and Restated Bylaws of Carbonite, Inc.
4.1 Indenture (including form of Note), dated as of April 4, 2017, by
and between Carbonite, Inc. and U.S. Bank National Association, as
trustee. (Filed as Exhibit 4.1 to Form 8-K filed with the Securities
and Exchange Commission on April 4, 2017 and incorporated herein by
reference.)
4.2 First Supplemental Indenture, dated as of December 24, 2019
between Carbonite, Inc. and U.S. Bank National Association, as
trustee.
20.1 Offer to Purchase dated November 25, 2019 (incorporated by
reference to Exhibit (a)(1)(A) to the Schedule TO filed by Open Text
Corporation on November 25, 2019)
99.1 Press Release issued by Open Text Corporation on December 24, 2019
(incorporated by reference to Exhibit (a)(5)(M) to Amendment 5 to
the Schedule TO filed by Open Text Corporation on December 26, 2019)
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
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