Viasat, Inc. (NasdaqGS:VSAT) entered into a definitive agreement to acquire RigNet, Inc. (NasdaqGS:RNET) from Houston Ventures, Millennium TVP Management Company, LLC, KKR & Co. Inc. (NYSE:KKR) and others for approximately $140 million on December 20, 2020. Under the terms of the agreement, RigNet stockholders will receive 0.1845 shares of Viasat common stock for each share of RigNet common stock. The total consideration will be paid in stock. As part of the agreement, (i) each RigNet option that is outstanding and unexercised, will be assumed by Viasat and converted automatically into an option to purchase shares of Viasat Common Stock on the same terms and conditions (including applicable vesting, exercise and expiration provisions), each RigNet option that is not an assumed RigNet option will accelerate in full and be terminated for no consideration, (ii) each award of RigNet restricted stock units that is outstanding will be assumed by Viasat and converted automatically into a restricted stock unit award with respect to shares of Viasat Common Stock and will otherwise remain subject to the same vesting, settlement and other terms and conditions that applied to the underlying Assumed RigNet RSU Award, (iii) each RigNet RSU (other than a Deferred RigNet RSU (as defined below)) that is not an Assumed RigNet RSU Award will accelerate in full and be settled in shares of Viasat Common Stock as of immediately prior to the Effective Time; and (iv) each RigNet RSU that is subject to, and not exempt from the requirements of, Section 409A of the Internal Revenue Code of 1986, as amended (each a “Deferred RigNet RSU”) will be treated in accordance with the terms of the Merger Agreement. The transaction represents an enterprise value for RigNet of approximately $222 million, consisting of approximately $130 million in RigNet equity value based on the closing price of Viasat common stock as of the date of the agreement and the assumption of approximately $92 million in RigNet debt, net of cash, at September 30, 2020. 100% stock consideration intended to be tax-free for RigNet shareholders. Post-acquisition, RigNet shareholders expected to own 5.7% of Viasat outstanding common equity and RigNet continuing as the surviving entity and a wholly owned subsidiary of Viasat. In connection with RigNet entering into an agreement for a Company Superior Proposal, RigNet may be required to pay Viasat a termination fee equal to $5.5 million. Viasat intends to incorporate RigNet into its Global Enterprise and Mobility business unit, led by President Jimmy Dodd. The RigNet team operates from its headquarters in Houston, Texas; management is expected to stay on to provide leadership, in-depth industry knowledge and customer relationship support.

The completion of the merger is subject to the satisfaction or waiver of customary closing conditions, including: (i) registration statement on Form S-4 to be filed in connection with the Merger shall have become effective; (ii) the adoption of the Merger Agreement by holders of a majority of the outstanding shares of RigNet Common Stock; (iii) the expiration or termination of review under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended; (iv) the receipt of certain other material regulatory consents and approvals; (v) the authorization for listing of shares of Viasat Common Stock to be issued in the merger on Nasdaq; (vi) the absence of any court order or regulatory injunction prohibiting completion of the merger; (vii) subject to specified materiality standards, the accuracy of the representations and warranties of each party; (viii) compliance by each party in all material respects with its covenants; (ix) the absence of any effects that have constituted or resulted in, or would reasonably be expected to constitute or result in, a material adverse effect with respect to either party; and (x) the receipt by each party of certain closing tax opinions and other customary closing conditions.

Viasat has also entered into a support agreement with certain stockholders of RigNet, under which such stockholders have agreed to vote all their RigNet shares in favor of the transaction at the special meeting of RigNet stockholders. The RigNet shares subject to the agreement represent approximately 25% of the current outstanding voting power of the RigNet common stock. Each of the Board of Directors of Viasat and the Board of Directors of RigNet have unanimously approved the merger agreement. The special meeting of shareholders of RigNet will be held webcast on April 21, 2021, to approve the transaction. On April 21, 2021 the shareholders of RigNet approved the transaction. The transaction is expected to close by mid-calendar year 2021. The transaction is immediately accretive to cashflow and is expected to modestly improve leverage profile.

LionTree Advisors LLC acted as financial advisor and Craig M. Garner of Latham & Watkins LLP acted as legal advisor to Viasat. Lazard Middle Market LLC acted as financial advisor and Edward Rhyne, James B. Marshall, Laura McDaniels, Robert Phillpott, Catriona Hatton and Paul Cuomo of Baker Botts L.L.P. acted as legal advisor to RigNet. Matthew B. Rogers of Simpson Thacher & Bartlett LLP acted as legal advisor to KKR & Co. Todd Feldman, Al Laufenberg, Cole Bader of Stifel, Nicolaus & Company, Incorporated acted as financial advisors and fairness opinion provider to RigNet's Board. Alliance Advisors LLC acted as an information agent for RigNet. RigNet estimates that it will pay Alliance a fee of approximately $25,000, plus reimbursement for certain out-of-pocket fees and expenses. Stifel, Nicolaus & Company, Incorporated was paid a fee of $350,000 for providing the fairness opinion.