NeuStar, Inc. (NYSE:NSR) Files An 8-K Entry into a Material Definitive Agreement
Item1.01.
| Entry into a Material Definitive Agreement. |
Merger Agreement
On December14, 2016, NeuStar, Inc.
(Neustar) entered into an Agreement and
Plan of Merger (the Merger Agreement)
with Aerial Topco, L.P., a Delaware limited partnership
(Parent), and Aerial Merger Sub, Inc.,
a Delaware corporation and wholly-owned subsidiary of Parent
(Merger Sub and, together with Parent,
the Acquiring Parties) to which,
subject to the satisfaction or waiver of the conditions therein,
Merger Sub will merge with and into Neustar (the
Merger), with Neustar surviving as a
wholly-owned subsidiary of Parent. Parent and Merger Sub were
formed by Golden Gate Private Equity, Inc. (Golden
Gate) and GIC Special Investments Pte Ltd
(GIC). The Merger Agreement was
unanimously approved by the members of the board of directors of
Neustar (the Board) and the Board
resolved to recommend approval of the Merger Agreement to
Neustars stockholders (the Board
Recommendation).
Subject to the terms of the Merger Agreement, at the effective
time of the Merger (the Effective
Time), each share of Neustar ClassA common stock
and ClassB common stock, each with a par value of $0.001 per
share, issued and outstanding immediately prior to the Effective
Time (other than shares owned by the Acquiring Parties and shares
held by Neustar, and certain of their affiliates, and shares held
by stockholders who have perfected their statutory rights of
appraisal under Section262 of the Delaware General Corporation
Law), will be converted into the right to receive $33.50 in cash,
without interest (the Merger
Consideration).
At the Effective Time, each Neustar stock option, whether or not
vested and exercisable, that is outstanding and unexercised
immediately prior to the Effective Time will be canceled
automatically in exchange for the right to receive an amount in
cash (less any applicable tax withholdings) equal to the product
of (i)the excess, if any, of the Merger Consideration over the
per share exercise price of such Neustar stock option and (ii)the
total number of shares of Neustar common stock otherwise issuable
upon exercise of such Neustar stock option immediately prior to
the Effective Time.At the Effective Time, each outstanding
Neustar restricted stock unit that is subject only to time-based
vesting will vest in full and will be canceled in exchange for
the right to receive an amount in cash (less any applicable tax
withholdings) equal to the product of (i)the Merger Consideration
and (ii)the number of shares of Neustar common stock subject to
such Neustar restricted stock unit award.At the Effective Time,
the performance-based conditions to which each outstanding
Neustar restricted stock unit subject to performance-based
vesting is subject will be deemed satisfied at the target levels
for any performance period not completed prior to Closing as
specified in the applicable equity plans and award agreements and
the resulting number of restricted stock units will be canceled
in exchange for the right to receive an amount in cash (less any
applicable tax withholdings) equal to the product of (i)the
Merger Consideration and (ii)the resulting number of shares of
Neustar common stock. At the Effective Time, each outstanding
share of Neustar restricted stock will become fully vested and
the restrictions with respect thereto shall lapse, and such
shares shall be treated in the Merger in the same manner as the
other shares of Neustar common stock.
The Merger Agreement contains customary representations,
warranties and covenants of Neustar and the Acquiring Parties,
including, among others, covenants by Neustar to conduct its
business in the ordinary course of business during the period
between execution of the Merger Agreement and consummation of the
Merger (the Closing) and prohibiting
Neustar from engaging in certain kinds of activities during such
period without the consent of the Acquiring Parties.The Merger
Agreement also contains customary termination provisions for both
Neustar and Parent, as discussed in more detail below.
The Merger is conditioned upon, among other things, the approval
of the Merger Agreement by the affirmative vote of holders of at
least a majority of all outstanding shares of common stock of
Neustar (the Stockholder Approval) at a
meeting of Neustars stockholders held for such purpose (the
Stockholder Meeting), the expiration of
the applicable waiting period (and any extension thereof) under
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, consent
of the Federal Communications Commission of the United States,
the review and clearance by the Committee on Foreign Investment
in the United States and other customary closing conditions.The
Closing is not subject to a financing condition.
The Merger Agreement contains a go-shop provision that, in
general, allows Neustar to solicit, initiate, facilitate and
encourage, and engage in discussions or negotiations with respect
to, an alternative transaction for a 30-day period ending on
January13, 2017 (the Go-Shop
Period). During the Go-Shop Period,
Neustar is
permitted to
terminate the Merger Agreement to accept an alternative
transaction that the Board determines would be more favorable
from a financial point of view to Neustars stockholders than the
Merger (a Superior Proposal).The
Company may continue discussions for 30 days after the Go-Shop
Period (the Go-Shop Tail Period) with
any party who made an acquisition proposal during the Go-Shop
Period that the Company determines, in good faith, is or would
reasonably be expected to lead to a Superior Proposal.
Following the
expiration of the Go-Shop Period, Neustar will be subject to a
customary no-shop
provision whereby, subject to certain exceptions, it will be
prohibited from (i)entering into discussions concerning, or
providing confidential information in connection with, any
alternative transaction and (ii)withholding, withdrawing,
amending or modifying in a manner adverse to the Acquiring
Parties the recommendation of the Board that Neustars
stockholders adopt the Merger Agreement.The no shop provision is
subject to a customary fiduciary out provision that allows
Neustar, under certain circumstances and in compliance with
certain obligations, to provide non-public information and engage
in discussions and negotiations with respect to an acquisition
proposal that would reasonably be expected to lead to a Superior
Proposal and, after the expiration of the Go-Shop Period until
Stockholder Approval, to accept a Superior Proposal and terminate
the Merger Agreement.
The Merger Agreement contains
certain termination rights for both Neustar and Parent, and
provides that, upon termination of the Merger Agreement under
specified circumstances, either party may be required to pay to
the other party a termination fee of up to $120million. In
addition, the Merger Agreement provides that Neustar will
reimburse Parents transaction-related expenses in an amount up to
$7.5million if the Merger Agreement is terminated for failure to
receive the Stockholder Approval.
Financing
Commitments
Parent has obtained equity and
debt financing commitments for the transactions contemplated by
the Merger Agreement, the aggregate proceeds of which will be
sufficient for Parent to pay the aggregate Merger Consideration
and all related fees and expenses of the Acquiring Parties and to
refinance certain indebtedness of Neustar. Funds affiliated with
Golden Gate and GIC have committed, to equity commitment letters
dated as of December14, 2016 (the Equity Commitment
Letter), to capitalize Parent, at or prior to the
Effective Time, with an aggregate equity contribution in an
amount of $1,240million, on the terms and subject to the
conditions set forth in the Equity Commitment Letter. In
addition, such funds have executed limited guarantees in favor of
Neustar to guarantee, subject to the limitations described
therein, the payment of a termination fee and certain other
expense obligations under the Merger Agreement.
Bank of America Merrill Lynch,
UBS, Jefferies and Angel Island (collectively, the
Lenders) have committed to provide debt
financing (the Debt Financing) for the
Merger consisting of a $1,400million senior secured first lien
credit facility and a $350million senior secured second lien
credit facility on the terms and subject to the conditions set
forth in a debt commitment letter, dated as December14, 2016 and
delivered to Neustar in advance of execution of the Merger
Agreement (the Debt Commitment Letter).
The obligations of the Lenders to provide the Debt Financing
under the Debt Commitment Letter are subject to a number of
conditions, including the receipt of executed loan documentation,
accuracy of representations and warranties, consummation of the
transactions contemplated in the Merger Agreement, contribution
of the equity contemplated by the Equity Commitment Letter, and
completion of the designated 15-business day marketing
period.
The foregoing description of
the Merger Agreement and the transactions contemplated thereby,
do not purport to be complete and are subject to, and qualified
in their entirety by the full text of the Merger Agreement, which
accompanies this Report as Exhibit2.1 and which is incorporated
herein by reference.
The Merger Agreement is
attached to provide investors with information regarding its
terms and is not intended to provide any other factual
information about Neustar, Parent or Merger Sub. The Merger
Agreement also contains representations and warranties of each of
Neustar, Parent and Merger Sub.The assertions embodied in those
representations and warranties were made for purposes of the
Merger Agreement and are subject to qualifications and
limitations agreed to by the respective parties in connection
with negotiating the terms of the Merger Agreement, including
information contained in certain disclosures between the
parties.Accordingly,
investors and security holders
should not rely on such representations and warranties as
characterizations of the actual state of facts or circumstances,
since they were only made as of a specific date and are modified
in important part by the disclosures between the parties.In
addition, certain representations and warranties may be subject
to a contractual standard of materiality different from what
might be viewed as material to stockholders, or may have been
used for purposes of allocating risk between the respective
parties rather than establishing matters of fact.Moreover,
information concerning the subject matter of such representations
and warranties may change after the date of the Merger Agreement,
which subsequent information may or may not be fully reflected in
Neustars or the Acquiring Parties public
disclosures.
| Item5.03. |
Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year. |
On December13, 2016, the Board
determined that it was in the best interests of Neustar and its
stockholders to adopt a bylaw (the Bylaw
Amendment), which Bylaw Amendment was thus adopted,
effective immediately, entitled Exclusive Jurisdiction of
Delaware Courts. to Section115 of the Delaware General
Corporation Law, the Bylaw Amendment designates the Court of
Chancery of the State of Delaware as the sole and exclusive
forum, unless Neustar consents in writing to the selection of an
alternative forum, for (i)any derivative action or proceeding
brought on behalf of Neustar, (ii)any action asserting a claim of
breach of a fiduciary duty owed by any current or former
director, officer, employee or stockholder of Neustar to Neustar
or Neustars stockholders, (iii)any action asserting a claim
against Neustar or any current or former director, officer,
employee or stockholder of Neustar arising to any provision of
the Delaware General Corporation Law or Neustars amended and
restated Certificate of Incorporation or Bylaws (as either may be
amended from time to time) or (iv)any action asserting a claim
against Neustar or any current or former director, officer,
employee or stockholder of Neustar governed by the internal
affairs doctrine. A copy of the Bylaw Amendment is attached as
Exhibit 3.1 to this Report and is incorporated herein by
reference.
| Item8.01. | Other Events. |
On December14, 2016, Neustar
and Parent issued a joint press release announcing the entry into
the Merger Agreement.A copy of the press release is attached
hereto as Exhibit99.1 and is incorporated herein by
reference.
Additional Information
about the Proposed Transaction and Where to Find
It
In connection with the
proposed transaction, Neustar will file a proxy statement with
the SEC. Additionally, Neustar will file other relevant materials
in connection with the proposed acquisition of Neustar by Golden
Gate. The materials to be filed by Neustar with the SEC may be
obtained free of charge at the SECs web site at www.sec.gov. In
addition, investors and security holders may obtain free copies
of the documents filed with the SEC by Neustar on Neustars
website at https://www.neustar.biz or by contacting Neustar
investor relations at InvestorRelations@neustar.biz. INVESTORS
AND SECURITY HOLDERS OF NEUSTAR ARE URGED TO READ THE PROXY
STATEMENT AND THE OTHER RELEVANT MATERIALS WHEN THEY BECOME
AVAILABLE BEFORE MAKING ANY VOTING OR INVESTMENT DECISION WITH
RESPECT TO THE PROPOSED TRANSACTION BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION.
Certain Information
Regarding Participants
Neustar and its directors,
executive officers and other persons, may be deemed to be
participants in the solicitation of proxies of Neustar
stockholders in connection with the proposed transaction.
Information concerning the interests of Neustars participants in
the solicitation, which may, in some cases, be different than
those of Neustars stockholders generally, is set forth in the
materials filed by Neustar with the SEC, including in Neustars
definitive proxy statement filed with the SEC on April29, 2016,
and will be set forth in the proxy statement relating to the
proposed transaction when it becomes
available.
Cautionary Statement
Regarding Forward-Looking
Statements
This announcement contains
forward-looking statements, including statements about the
expectedimpact of this transaction on Neustars financial and
operating results and business, the anticipated funding for the
transaction, and the timing of the closing of the transaction.
Although Neustar believes that the assumptions upon which its
forward-looking statements are based are reasonable, these
statements involve risks and uncertainties, and actual
results
could differ materially from
those discussed. Factors that could cause or contribute to such
differences include, but are not limited to, the receipt and
timing of regulatory approvals for the transaction, the receipt
of Neustar stockholder approval, the possibility that the
transaction may not close, the failure to obtain the necessary
financing arrangements set forth in the debt and equity
commitment letters delivered to the Merger Agreement, the
reaction to the transaction of Neustars customers and business
partners, the reaction of competitors to the transaction, the
retention of Neustar employees, and the disruption of managements
attention from the Companys ongoing business operations due to
the transaction.
More information about these
and other factors can be found in Neustars most recent Annual
Report on Form10-K, Quarterly Reports on Form10-Q, Current
Reports on Form8-K and other filings with the SEC. Neither Golden
Gate Capital nor Neustar accept any responsibility for any
financial or operational information contained in this press
release relating to the business, results of operations or
financial condition of the other. Each of Golden Gate Capital and
Neustar expressly disclaims any obligation or undertaking to
disseminate any updates or revisions to any forward-looking
statements contained herein to reflect any change in the
expectations with regard thereto or any change in events,
conditions or circumstances on which any such statement is
based.
Item9.01 Financial
Statements and Exhibits.
(d)
Exhibits
|
Exhibit Number |
Description |
|
| 2.1 |
Agreement and Plan of Merger, dated December14, 2016, by and among NeuStar, Inc., Aerial Topco, L.P. and Aerial Merger Sub, Inc.* |
|
| 3.1 |
Amendment to Amended and Restated Bylaws dated December13, 2016 |
|
| 99.1 | Joint Press Release, dated December14, 2016 |
| * |
Schedules have been omitted to Item 601(b)(2)of Regulation S-K.Neustar hereby undertakes to furnish copies of any of the omitted schedules upon request by the Commission. |
to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned
hereunto duly authorized.
| NeuStar, Inc. | ||||||
| Dated: December14, 2016 | By: |
/s/ Paul S. Lalljie |
||||
| Name: | Paul S. Lalljie | |||||
| Title: |
Chief Financial Officer (Principal Financial and Accounting Officer and Duly Authorized Officer) |
ExhibitIndex
|
Exhibit Number |
Description |
|
| 2.1 |
Agreement and Plan of Merger, dated December14, 2016, by and among NeuStar, Inc., Aerial Topco, L.P. and Aerial Merger Sub, Inc.* |
|
| 3.1 |
Amendment to Amended and Restated Bylaws dated December13, 2016 |
|
| 99.1 | Joint Press Release, dated December14, 2016 |
| * | Schedules have been omitted |
About NeuStar, Inc. (NYSE:NSR)
Neustar, Inc. is a real-time provider of cloud-based information services, enabling marketing and information technology (IT) security professionals to promote and protect their businesses. The Company operates data registries and uses its expertise to deliver actionable, data-driven insights that help clients make business decisions in real time, one customer interaction at a time. NeuStar, Inc. (NYSE:NSR) Recent Trading Information
NeuStar, Inc. (NYSE:NSR) closed its last trading session up +5.73 at 33.38 with 637,328 shares trading hands.