INC RESEARCH HOLDINGS, INC. (NASDAQ:INCR) Files An 8-K Entry into a Material Definitive Agreement

ME Staff 8-k

8 years ago

INC RESEARCH HOLDINGS, INC. (NASDAQ:INCR) Files An 8-K Entry into a Material Definitive Agreement

Item1.01 Entry into a Material Definitive Agreement.

Agreement and Plan of Merger

On May10, 2017, INC Research Holdings, Inc., a Delaware
corporation (the Company), entered into an Agreement and
Plan of Merger (the Merger Agreement) with Double Eagle
Parent, Inc., a Delaware corporation (inVentiv), the
indirect parent company of inVentiv Group Holdings, Inc., to
which inVentiv will merge with and into the Company (the
Merger), with the Company surviving the Merger.

Subject to the terms and conditions of the Merger Agreement, the
aggregate merger consideration (the Aggregate Merger
Consideration) to be paid in respect of all outstanding
shares of inVentivs common stock, par value $0.0001 per share
(each an inVentiv Share), inVentiv options and inVentiv
restricted stock units shall be 49,989,839 shares of the Companys
Common Stock, par value $0.01 per share (each, a share of
Company Common Stock).

In accordance with the terms of the applicable award agreement,
the Merger Agreement provides that each vested inVentiv stock
option will be converted into an economically equivalent option
for Company Common Stock on the same terms as before such
conversion and each vested inVentiv restricted stock unit will be
cancelled for Company Common Stock on the same basis as an
inVentiv Share. Each inVentiv stock option and restricted stock
unit that does not vest as of the Effective Time (as defined in
the Merger Agreement) will be forfeited and cancelled for no
consideration.

The Merger Agreement contains customary representations and
warranties of the Company and inVentiv relating to their
respective businesses, financial statements and public filings,
in each case generally subject to customary materiality
qualifiers. Additionally, the Merger Agreement provides for
customary pre-closing covenants of the Company and inVentiv,
including covenants relating to conducting their respective
businesses in the ordinary course consistent with past practice
and to refrain from taking certain actions without the other
partys consent. The Merger Agreement also contains covenants not
to solicit proposals relating to alternative transactions or,
subject to certain exceptions, enter into discussions concerning
or provide information in connection with alternative
transactions and, subject to certain exceptions, to recommend
that the respective partys stockholders adopt the Merger
Agreement and, in the case of the Company, approve the necessary
issuance of shares to pay the Aggregate Merger Consideration.

Prior to the adoption of the Merger Agreement by the Companys
stockholders, the board of directors of the Company (the
Board) may withhold, withdraw, qualify or modify its
recommendation that the Companys stockholders adopt the Merger
Agreement in connection with a Superior Proposal or an
Intervening Event (in each case, as defined in the Merger
Agreement), if the Board determines that the failure to make such
change in recommendation would be inconsistent with its fiduciary
duties, or terminate the Merger Agreement to enter into an
alternative acquisition agreement providing for a Superior
Proposal, in each case, subject to complying with certain notice
and other specified

conditions, including giving inVentiv the opportunity to propose
revisions to the terms of the transaction contemplated by the
Merger Agreement during a match right period, and the payment of
a termination fee prior to or concurrently with such termination.

Consummation of the Merger is subject to various conditions,
including, among others, customary conditions relating to the
adoption of the Merger Agreement by the requisite vote of the
Companys and inVentivs respective stockholders; expiration of the
applicable waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended; certain foreign regulatory
approvals; and that for U.S. federal income tax purposes, the
Merger will not fail to qualify for treatment as a reorganization
under Section368 of the Code as a result of any change to or
interpretation of U.S. federal income Tax Law (as defined in the
Merger Agreement), in each case as of the date of the Merger
Agreement. The obligation of each party to consummate the Merger
is also conditioned upon the other partys representations and
warranties being true and correct (subject to certain materiality
exceptions) and the other party having performed in all material
respects its obligations under the Merger Agreement.

The Merger Agreement contains termination rights for each of the
Company and inVentiv, including, among others, if the closing of
the Merger does not occur on or before November10, 2017, subject
to extension until February12, 2018 in certain circumstances (the
Termination Date). Upon termination of the Merger
Agreement under specified circumstances, including (1)a
termination by the Company to enter into an agreement for an
alternative transaction in connection with a superior proposal
that did not result from a breach of the non-solicitation
provisions and with respect to which the Board concludes that
failure to take such action would reasonably be expected to be
inconsistent with its fiduciary duties, or (2)termination by
inVentiv following a change of recommendation by the Board that
does not relate to an Intervening Event, the Company would be
required to pay inVentiv a termination fee of $82.1million. The
Company would be required to pay inVentiv a termination fee of
$70.7million if inVentiv terminates the Merger Agreement
following a change of recommendation by the Board that relates to
an Intervening Event. In addition, if the Merger Agreement is
terminated by either party for failure of the Closing to occur by
the Termination Date, by either party for failure to obtain the
approval of the Companys stockholders, or by inVentiv for certain
material breaches by the Company of its representations and
covenants under the Merger Agreement, and in each case a
competing acquisition proposal has previously been made but not
withdrawn, and within 12 months following such termination, the
Company enters into an agreement for, or consummates, an
alternative change of control transaction that is later
consummated, then the Company shall pay inVentiv a termination
fee of $82.1million (which fee is payable upon consummation of
the alternative transaction).

The foregoing summary of the Merger Agreement is qualified in its
entirety by the full text of the Merger Agreement, which is
attached hereto as Exhibit 2.1 and is incorporated by reference
herein.

Voting Agreements

On May10, 2017, concurrently with the execution of the Merger
Agreement, the Company and inVentiv entered into voting
agreements (each, a Voting Agreement) with certain
investment funds affiliated with Thomas H. Lee Partners, L.P.
(the THL Stockholder) and certain investment funds
affiliated with Advent International Corporation (the Advent
Stockholder and each of the THL Stockholder and the Advent
Stockholder, a Stockholder and collectively, the
Stockholders) to each of which, among other things and
subject to the terms and conditions therein, the Stockholders
have agreed to act by written consent to vote all of the inVentiv
Shares beneficially owned by them (the Covered Shares) in
favor of the adoption of the Merger Agreement and the approval of
the transactions contemplated by the Merger Agreement, including
the Merger, and to not vote in favor of any alternative
acquisition proposal or other action or agreement that would
reasonably be expected to materially impede, interfere with or
delay the consummation of the Merger.

The Voting Agreements also generally prohibit the Stockholders
from transferring the Covered Shares. The Voting Agreements
terminate upon the earliest of (i)the termination of the Merger
Agreement, (ii)the time the Merger becomes effective or (iii)the
date of any modification or amendment to the Merger Agreement, as
in effect on the date of the applicable Voting Agreement, in a
manner that reduces the amount and/or form of consideration
payable thereunder to the Stockholder or otherwise adversely
affects the Stockholder in any material respect without the prior
written approval of the Stockholder.

The foregoing description of the Voting Agreements does not
purport to be complete and is qualified in its entirety by
reference to the actual Voting Agreements, copies of which are
attached hereto as Exhibits 10.1 and 10.2 to this Current Report
on Form 8-K and incorporated herein by reference.

Stockholders Agreements

On May10, 2017, concurrently with the execution of the Merger
Agreement, the Company entered into a stockholders agreement with
the THL Stockholder (the THL Stockholders Agreement) and a
stockholders agreement with the Advent Stockholder (the Advent
Stockholders Agreement and together with the THL Stockholders
Agreement, the Stockholders Agreements).

The Stockholders Agreements provide that following the effective
time of the Merger, the Board will be comprised of ten directors,
provided, that from and after the second annual meeting of the
stockholders of the Company following the closing date of the
Merger (the Second Annual Meeting), the Board will be
comprised of nine directors. On the closing date of the Merger,
the Board will consist of: (i)Michael Bell, (ii)Alistair
Macdonald, (iii)four incumbent directors of the Company (other
than Mr.Macdonald) selected by the Board prior to the closing of
the Merger, (iv)two directors nominated by the THL Stockholder,
which directors shall be Todd Abbrecht and Joshua Nelson (the
THL Nominees) and (v)two directors nominated by the Advent
Stockholder, which directors shall be Tom Allen and John
Maldonado (the Advent Nominees and together with the
Advent Nominees, the Investor Nominees).

to both of the Stockholders Agreements, if the applicable
Stockholder and its affiliates beneficially own at least 16.5% of
the then outstanding shares of Company Common Stock, then the
Stockholder may designate two Investor Nominees. From and after
the time the Stockholder and its affiliates beneficially own at
least 5% but less than 16.5% of the then outstanding shares of
Company Common Stock, then the Stockholder may designate one
Investor Nominee. After the applicable Stockholder and its
affiliates beneficially own less than 5% of the then outstanding
shares of Company Common Stock, then such Stockholder will no
longer have the right to designate any Investor Nominees.

The Stockholders Agreements also provide the applicable
Stockholder with the right, subject to certain limitations, to
designate its Investor Nominees that have been elected to the
Board to serve as members of certain committees of the Board as
set forth in the Stockholders Agreement.

The Stockholders Agreements also provide, among other things,
that:

until the Second Annual Meeting, Michael Bell will serve as
the Executive Chairperson of the Board, and thereafter the
size of the Board will be reduced to nine directors;

the Lead Independent Director will be an independent director
approved by the Non-Affiliated Directors (as defined below)
by majority vote, and from and after the Second Annual
Meeting, the Board will have the right to determine by
majority vote whether to have a Lead Independent Director,
and if so, such Lead Independent Director will be selected by
a majority vote of the Board; and

the Chief Executive Officer of the Company will be Alistair
Macdonald.

Non-Affiliated
Directors means the directors other than
(i)the Investor Nominees, (ii)the CEO and (iii)the Chairperson of
the Board prior to the Second Annual Meeting.

The Stockholders
are also subject to certain standstill and transfer restrictions
and are entitled to customary pre-emptive and registration
rights.

Each Stockholders
Agreement will terminate upon the earlier of (i)the applicable
Stockholder and its affiliates ceasing to beneficially own at
least 5% of the outstanding shares of Company Common Stock and
(ii)the mutual written agreement of the applicable Stockholder
and the Company.

The foregoing
description of the THL Stockholders Agreement and Advent
Stockholders Agreement does not purport to be complete and is
qualified in its entirety by reference to the actual THL
Stockholders Agreement and Advent Stockholders Agreement, copies
of which are attached hereto as Exhibits 10.3 and 10.4,
respectively, to this Current Report on Form 8-K and incorporated
herein by reference.

Letter
Agreement

In connection with
the transaction, the Company has entered into a letter agreement
with Michael A. Bell, which provides that, upon the closing,
Mr.Bell will become Executive Chairman of the Company and of the
Board. Mr.Bell will continue to have the same salary and bonus
opportunity as provided under his current employment agreement
with inVentiv and will be entitled to receive certain annual
long-term incentive awards. The foregoing description is
qualified in its entirety by reference to the letter agreement,
attached hereto as Exhibit 10.5.

The Merger
Agreement, the Voting Agreements, the Stockholders Agreements and
the letter agreement have been included to provide investors with
information regarding their terms. They are not intended to
provide any other factual information about the Company, inVentiv
or their respective subsidiaries or affiliates. The
representations, warranties and covenants contained in the Merger
Agreement, the Voting Agreements, the Stockholders Agreements and
the letter agreement were made only for purposes of such
agreements and as of specific dates, were solely for the benefit
of the parties to such agreements, may be subject to limitations
agreed upon by the contracting parties, including being qualified
by confidential disclosures made for the purposes of allocating
contractual risk between the respective parties to such
agreements instead of establishing these matters as facts, and
may be subject to standards of materiality applicable to the
contracting parties that differ from those applicable to
investors. Investors are not third-party beneficiaries under the
Merger Agreement, the Voting Agreements, Stockholders Agreements
and the letter agreement and should not rely on the
representations, warranties and covenants or any descriptions
thereof as characterizations of the actual state of facts or
condition of the parties thereto or any of their respective
subsidiaries or affiliates. Moreover, information concerning the
subject matter of representations and warranties may change after
the date of the Merger Agreement, the Voting Agreements, the
Stockholders Agreements and the letter agreement, which
subsequent information may or may not be fully reflected in the
Companys public disclosures.

Debt
Financing

In connection with
the entry into the Merger Agreement, inVentiv Group Holdings,
Inc. entered into a debt financing commitment letter (the Debt
Commitment Letter) with Credit Suisse Securities (USA) LLC
and Credit Suisse AG (the Commitment Parties) to which the
Commitment Parties have agreed to arrange and provide inVentiv
Group Holdings, Inc. with a senior secured incremental term loan
in an aggregate principal amount of $550million, on the terms and
subject to the conditions set forth in the Debt Commitment
Letter, the proceeds of which will be applied to refinance the
Companys outstanding credit agreement and pay fees and expenses
in connection with

the Merger and the
related transactions. In addition, the Company and inVentiv have
agreed to use commercially reasonable efforts to obtain debt
financing in the form of a senior secured term loan facility in
an aggregate principal amount of approximately $2.6billion and a
senior secured cash flow revolver of approximately $500million in
lieu of the financing provided in the Debt Commitment Letter in
order to, among other things, refinance the Companys outstanding
credit agreement and to prepay certain indebtedness of inVentiv,
including all amounts outstanding under inVentivs credit
agreements. On May10, 2017, the Company and inVentiv entered into
an engagement letter with Credit Suisse Securities (USA) LLC to
arrange such debt financing on a best efforts basis.

Item2.02

Results of Operations and Financial
Condition

On May10, 2017,
the Company issued a press release announcing its financial
results for the three months ended March31, 2017.The full text of
the press release was posted on the Companys internet website and
is furnished as Exhibit 99.1 hereto and incorporated herein by
reference.

to General
Instruction B.2 of Current Report on Form 8-K, the information
contained in, or incorporated into, Item 2.02, including the
press release attached as Exhibit 99.1, is being furnished and
shall not be deemed filed for the purposes of Section18 of the
Securities Exchange Act of 1934, as amended (the Exchange Act),
or otherwise subject to the liabilities of that section, nor
shall it be deemed incorporated by reference into any
registration statement or other filing under the Securities Act
of 1933, as amended (the Securities Act), or the Exchange
Act, except as shall be expressly set forth by specific reference
to such filing.

Item3.02

Unregistered Sales of Equity Securities

As described in
Item 1.01 above, subject to the terms and conditions set forth in
the Merger Agreement, at the closing, the Company will issue
49,989,839 shares of Company Common Stock in the Merger.

The share issuance
is made in reliance on an exemption from the registration
requirements to Section 4(a)(2) of the Securities Act, and Rule
506 of Regulation D promulgated under the Securities Act since
the share issuance does not involve any public offering. The
information in Item1.01 above is incorporated into this Item 3.02
by reference.

Item7.01

Regulation FD Disclosure.

On May10, 2017,
the Company and inVentiv jointly issued a press release
announcing they had entered into the Merger Agreement. A copy of
the joint press release is attached hereto as Exhibit 99.2 and is
incorporated by reference herein.

On May10, 2017,
the Company held an investor call relating to the transactions
contemplated by the Merger Agreement. The Company made available
on the investor relations section of its website an investor
presentation for reference during such call. A copy of the
investor presentation is attached hereto as Exhibit 99.3 and is
incorporated by reference herein.

The information
under this Item 7.01 of this Current Report on Form 8-K,
including Exhibits 99.2 and 99.3, is being furnished under Item
7.01 and shall not be deemed to be filed for purposes of
Section18 of the Exchange Act, or otherwise subject to liability
of that section nor shall such information be deemed incorporated
by reference in any filing under the Securities Act or the
Exchange Act, regardless of any general incorporation language in
such filing, except as shall be expressly set forth by specific
reference in such filing.

Item9.01
Financial Statements and Exhibits

(d)
Exhibits


Exhibit No.		Description

2.1		Agreement and Plan of Merger, dated May10, 2017, between INC Research Holdings, Inc. and Double Eagle Parent, Inc.

10.1		Voting Agreement, dated May10, 2017, between INC Research Holdings, Inc., Double Eagle Parent, Inc. and Thomas H. Lee Partners, L.P.

10.2		Voting Agreement, dated May10, 2017, between INC Research Holdings, Inc., Double Eagle Parent, Inc. and Advent International Corporation.

10.3		Stockholders Agreement, dated May10, 2017, by and among INC Research Holdings, Inc. and the stockholders party thereto.

10.4		Stockholders Agreement, dated May10, 2017, by and among INC Research Holdings, Inc. and the stockholders party thereto.

10.5		Letter Agreement, dated May10, 2017, by and among INC Research Holdings, Inc., inVentiv Health, Inc. and Michael A. Bell.

99.1		Press release, dated May10, 2017, issued by INC Research Holdings, Inc.

99.2		Press release, dated May10, 2017, issued by INC Research Holdings, Inc. and inVentiv Health, Inc.

99.3		Investor presentation, dated May10, 2017.

About INC RESEARCH HOLDINGS, INC. (NASDAQ:INCR)
INC Research Holdings, Inc. is a global contract research organization (CRO). The Company is focused on Phase I to Phase IV clinical development services for the biopharmaceutical and medical device industries. The Company operates through two segments: Clinical Development Services and Phase I Services. The Company’s Clinical Development Services segment offers all clinical development services, including full-service global studies, as well as ancillary services, such as clinical monitoring, investigator recruitment, patient recruitment, data management, study reports to assist customers with their drug development process, quality assurance audits and specialized consulting services. The Company’s Phase I Services segment focuses on clinical development services for Phase I trials, which include scientific exploratory medicine, first-in-human studies through proof-of-concept stages and support for Phase I studies in established compounds. INC RESEARCH HOLDINGS, INC. (NASDAQ:INCR) Recent Trading Information
INC RESEARCH HOLDINGS, INC. (NASDAQ:INCR) closed its last trading session up +9.15 at 52.80 with 1,880,512 shares trading hands.