UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

 

Date of Report (Date of earliest event reported): January 8, 2019

 

 

GTY TECHNOLOGY HOLDINGS INC.

(Exact name of registrant as specified in its charter)

 

 

 Cayman Islands  001-37931  N/A
(State or other jurisdiction
of incorporation) 		(Commission
File Number) 		(IRS Employer
Identification No.)

 

1180 North Town Center Drive, Suite 100, Las Vegas, Nevada 89144

(Address of principal executive offices, including zip code)

 

Registrant’s telephone number, including area code:  (702) 945-2898

 

Not Applicable  
(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

x Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
   
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
   
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
   
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company x

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

 

 

 

 

Item 1.01 Entry into a Material Definitive Agreement.

 

Amendment to eCivis Agreement

 

As previously announced, on September 12, 2018, GTY Technology Holdings Inc. (“GTY” or the “Company”) entered into definitive agreements to acquire each of Bonfire Interactive Ltd., CityBase, Inc., eCivis, Inc. (“eCivis”), Open Counter Enterprises Inc., Questica Inc. and Questica USCDN Inc. and Sherpa Government Solutions LLC (collectively, the “Targets”), which such agreements were first amended on October 31, 2018 and subsequently amended (or, in some cases, amended and restated) on December 28, 2018 (as amended, the “Transaction Documents”). The transactions contemplated by the Transaction Documents are collectively referred to herein as the “Business Combination.”

 

On January 8, 2019, the Company entered into an amendment (the “eCivis Amendment”) to the Amended and Restated Agreement and Plan of Merger, dated December 28, 2018, by and among eCivis, the Company, GTY EC Merger Sub, Inc. and the eCivis Holders’ Representative named therein (the “eCivis Agreement”) to provide, among other things, that $1 million of the cash consideration otherwise payable to eCivis Holders at the eCivis Closing will be deposited into an escrow account in order to cover certain obligations of eCivis owed to a third party (as such terms are defined in the eCivis Agreement).

 

The eCivis Amendment also revises the calculation to determine the number of shares of GTY Govtech Inc. (“New GTY”) common stock to be paid pursuant to the earn-out if certain tiers of revenues and EBITDA for the year ending December 31, 2020 are met. As amended, the number of shares will be determined by dividing (x) either $10,000,000, $20,000,000, $30,000,000, $40,000,000 or $50,000,000 (depending on the tier of revenues and EBITDA achieved) by (y) $10.00 (rather than dividing the amount described in clause (x) by the volume weighted average closing price for the shares of New GTY common stock as of December 31, 2020).

 

The foregoing description of the eCivis Amendment does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the eCivis Amendment, a copy of which is attached hereto as Exhibit 2.1 and is incorporated herein by reference.

 

Subscription Agreements

 

On January 9, 2019, the Company entered into subscription agreements (the “Subscription Agreements”) with certain institutional and accredited investors (the “Investors”), pursuant to which such Investors have agreed to purchase, immediately prior to the closing of the Business Combination, an aggregate of 6,656,238 Class A ordinary shares of the Company at a price of  $10.00 per share, or an aggregate cash purchase price of  $66,562,380, subject to certain conditions, including all conditions precedent to the closing of the Business Combination having been satisfied or waived, in a private placement. GTY Investors, LLC, the Company’s sponsor, will surrender to the Company for cancellation at no cost 124,214 Class B ordinary shares of the Company and the Company will issue an additional 124,214 Class A ordinary shares in the aggregate to certain of such Investors in consideration of their subscriptions. The Class A ordinary shares issuable to the Investors will be converted into shares of common stock of New GTY pursuant to the Business Combination.

 

Certain of the Investors have also agreed to not transfer any of the ordinary shares they own prior to the closing of the Business Combination and to not seek redemption of such ordinary shares in connection with the Business Combination. The Subscription Agreements contain customary representations and warranties of the Company and each Investor.

 

The foregoing description of the Subscription Agreements does not purport to be complete and is qualified in its entirety by the terms and conditions of the form of Subscription Agreement, a copy of which is attached hereto as Exhibit 10.1 and is incorporated herein by reference.

 

 

 

 

Amendment to Underwriting Agreement

 

On January 9, 2019, the Company entered into an amendment (the “UA Amendment”) to the Underwriting Agreement, dated as of October 26, 2016, as amended (the “Underwriting Agreement”), by and among the Company and Citigroup Global Markets Inc., as representative of the underwriters of the Company’s initial public offering of units (the “Underwriters”), pursuant to which the deferred underwriting fees of  $19.32 million, which were originally payable by the Company to the Underwriters in cash upon completion of the Business Combination, are payable upon completion of the Business Combination as follows: $3.25 million in cash and $16.1 million in the Company’s ordinary shares, par value $0.0001 per share (the share portion of which is, at the Company’s election, payable in cash and subject to downward adjustment as provided in the UA Amendment).

 

The foregoing description of the UA Amendment does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the UA Amendment , a copy of which is attached hereto as Exhibit 1.1 and is incorporated herein by reference.

 

Item 3.02 Unregistered Sales of Equity Securities.

 

The disclosure set forth above in Item 1.01 of this Current Report on Form 8-K with respect to the Subscription Agreements is incorporated by reference into this Item 3.02. The Class A ordinary shares of the Company to be issued to the Investors in connection with the Subscription Agreements will not be registered under the Securities Act of 1933, as amended (the “Securities Act”), in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder.

 

Important Information About the Business Combination and Where to Find It

 

In connection with the Business Combination, New GTY, a wholly owned subsidiary of GTY, has filed a Registration Statement on Form S-4 (the “Registration Statement”) with the U.S. Securities and Exchange Commission (the “SEC”), which includes a preliminary proxy statement/prospectus, relating to (i) an extraordinary general meeting of shareholders of GTY to vote upon, among other things, the Business Combination (the “shareholder meeting”) and (ii) an extraordinary general meeting of public warrant holders of GTY to vote upon, among other things, a proposed amendment to the warrant agreement governing the Company’s warrants (the “Warrant Agreement”) (such meeting of the public warrant holders of GTY, the “warrant holder meeting”). After the Registration Statement becomes effective, GTY will mail a definitive proxy statement/​prospectus and other relevant documents to its shareholders in connection with the shareholder meeting and the warrant holder meeting.  The Company’s shareholders, warrant holders and other interested persons   are advised to read, when available, the preliminary proxy statement/prospectus included in the Registration Statement and the amendments thereto   and the definitive proxy statement/prospectus and documents incorporated by reference therein filed in   connection with the Business Combination and the proposed amendment to the Warrant Agreement, as these materials will contain important information   about the Targets, the Company, the Business Combination and the proposed amendment to the Warrant Agreement.   The definitive proxy statement/prospectus and other relevant materials for the Business Combination and the proposed amendment to the Warrant Agreement will be mailed to shareholders and warrant holders of the Company as of a record date to be established for voting on the Business Combination and the proposed amendment to the Warrant Agreement. Shareholders and warrant holders will also be able to obtain copies of the preliminary proxy statement/prospectus, the definitive proxy statement/prospectus and other documents filed with the SEC that will be incorporated by reference therein, without charge, once available, at the SEC’s web site at www.sec.gov, or by directing a request to: GTY Technology Holdings Inc., 1180 North Town Center Drive, Suite 100, Las Vegas, Nevada 89144, Attention: Harry L. You, (702) 945-2898.

 

Participants in the Solicitation

 

GTY and its directors and executive officers may be deemed participants in the solicitation of proxies from GTY’s shareholders and warrant holders with respect to the shareholder meeting and warrant holder meeting. A list of the names of those directors and executive officers and a description of their interests in GTY is contained in New GTY’s proxy statement/prospectus on Form S-4, which was filed with the SEC and is available free of charge at the SEC’s web site at www.sec.gov, or by directing a request to GTY Technology Holdings Inc., 1180 North Town Center Drive, Suite 100, Las Vegas, Nevada 89144, Attention: Harry L. You, (702) 945-2898. Additional information regarding the interests of such participants are contained in the proxy statement/prospectus on Form S-4 relating to the shareholder meeting and warrant holder meeting.

 

 

 

 

The Targets and their directors and executive officers may also be deemed to be participants in the solicitation of proxies from the shareholders and warrant holders of GTY in connection with the shareholder meeting and warrant holder meeting. A list of the names of such directors and executive officers and information regarding their interests in the shareholder meeting and warrant holder meeting are included in the proxy statement/prospectus on Form S-4 relating to the shareholder meeting and warrant holder meeting.

 

Forward-Looking Statements

 

This Current Report on Form 8-K and the Exhibits hereto include “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. The Company’s and each Target’s actual results may differ from their expectations, estimates and projections and consequently, you should not rely on these forward looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, the Company’s and the Targets’ expectations with respect to future performance and anticipated financial impacts of the Business Combination, the satisfaction of the closing conditions to the Business Combination and the timing of the completion of the Business Combination. These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Most of these factors are outside of either the Company’s or the Targets’ control and are difficult to predict. Factors that may cause such differences include, but are not limited to: (1) the occurrence of any event, change or other circumstances that could give rise to the termination of any of the Transaction Documents or could otherwise cause a Business Combination to fail to close; (2) the outcome of the New York and California lawsuits among the Company, OpenGov, Inc. and the other parties thereto, as well as any other legal proceedings that may be instituted against the Company or a Target in connection with the Transaction Documents and the Business Combination; (3) the inability to complete a Business Combination, including due to failure to obtain approval of the shareholders of the Company or other conditions to closing in the Transaction Documents; (4) the inability to complete the proposed amendment to the Warrant Agreement, including due to the failure to obtain the approval of the warrant holders of the Company; (5) the receipt of an unsolicited offer from another party for an alternative business transaction that could interfere with a Business Combination; (6) the inability to obtain or maintain the listing of New GTY’s common stock on The Nasdaq Stock Market following the Business Combination; (7) the risk that a Business Combination disrupts current plans and operations as a result of the announcement and consummation of the Business Combination; (8) the ability to recognize the anticipated benefits of a Business Combination, which may be affected by, among other things, competition, the ability of the combined company to grow and manage growth profitably and retain its key employees; (9) costs related to the Business Combination; (10) changes in applicable laws or regulations; (11) the possibility that a Target or the post-combination company may be adversely affected by other economic, business, and/or competitive factors; (12) any government shutdown, such as the federal government shutdown which commenced in December 2018, which impacts the ability of the Targets’ customers to purchase the Targets’ products and services; and (13) other risks and uncertainties indicated from time to time in the proxy statement/prospectus on Form S-4 relating to the Business Combination, including those under “Risk Factors” therein, and in the Company’s other filings with the SEC. The Company cautions that the foregoing list of factors is not exclusive. The Company cautions readers not to place undue reliance upon any forward-looking statements, which speak only as of the date made. The Company does not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based.

 

No Offer or Solicitation

 

This Current Report on Form 8-K shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the Business Combination. This Current Report on Form 8-K shall also not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any states or jurisdictions in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act, or an exemption therefrom.

 

 

 

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits

 

Exhibit No.   Description  
1.1 Amendment to Underwriting Agreement, dated as of January 9, 2019, by and among GTY Technology Holdings Inc. and Citigroup Global Markets Inc., as representative of the underwriters.
2.1 Amendment No. 1 to Amended and Restated Agreement and Plan of Merger, dated January 8, 2019, by and among eCivis Inc., GTY Technology Holdings Inc., GTY EC Merger Sub, Inc. and the eCivis Holders’ Representative named therein.
10.1 Form of Subscription Agreement between GTY Technology Holdings Inc. and certain institutional and accredited investors.  

 

 

 

 

SIGNATURE

 

Pursuant 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.

 

  GTY TECHNOLOGY HOLDINGS INC.   
       
  By: /s/ Harry L. You  
    Name: Harry L. You  
    Title: President and Chief Financial Officer  
       
 Dated: January 14, 2019      

 

 

 

 

 

Exhibit 1.1

 

EXECUTION VERSION 

 

GTY Technology Holdings Inc.

1180 North Town Center Drive, Suite 100

Las Vegas, Nevada 89144

 

January 9, 2019

 

Citigroup Global Markets Inc.

As Representative of the several Underwriters

c/o Citigroup Global Markets Inc.

388 Greenwich Street

New York, New York 10013

 

Re: Underwriting Agreement

 

Ladies and Gentlemen:

 

Reference is made to that certain Underwriting Agreement, dated October 26, 2016 and amended on October 30, 2018, by and among GTY Technology Holdings Inc., a Cayman Islands exempted company (the “ Company ”), and Citigroup Global Markets Inc., as representative (the “ Representative ”) of the several underwriters named on Schedule I thereto (the “ Underwriting Agreement ”). Except as otherwise specifically provided herein, all capitalized terms used herein shall have the meanings ascribed to them in the Underwriting Agreement.

 

The Underwriting Agreement is hereby amended by this letter agreement (this “ Amendment ”), effective as of the date first listed above, as follows:

 

1.                   The first two sentences of Section 2(c) of the Underwriting Agreement are hereby replaced with the following three sentences:

 

“In addition to the discount from the public offering price represented by the purchase price set forth in the first sentence of Section 2(a) of this Agreement, the Company hereby agrees to pay to the Underwriters a deferred discount of $0.35 per Unit (for both Underwritten Securities and Option Securities) purchased hereunder (the “Deferred Discount”), $3,250,000 of which is payable in cash (the “Cash Portion”) and the balance of which (the “Stock Deferred Discount Amount”) is payable in newly issued Ordinary Shares (the “Stock Portion”), valued for these purposes at $10.00 per share. The Deferred Discount will be paid directly to the Representative, on behalf of the Underwriters, if and when the Company consummates an initial Business Combination, with the Cash Portion paid by the trustee from amounts on deposit in the Trust Account by wire transfer or, if such amounts on deposit in the Trust Account are less than the Cash Portion, by separate wire transfer from the Company in respect of any such deficiency. Notwithstanding the foregoing, in the Company’s sole discretion, the Company may notify the Representative that it wishes to pay cash in lieu of the Stock Portion, in which case the Stock Deferred Discount Amount is subject to downward adjustment, and the amount thereof payable in cash, in accordance with Schedule IV hereto. The Company (including its successor upon consummation of an initial Business Combination) agrees not to publicly disclose the information set forth in Schedule IV hereto without the prior written consent of the Representative, except as required by applicable law, regulation or legal process.”

 

 

 

 

2.                   Section 3(b) of the Underwriting Agreement is hereby amended to delete the words “, including $16,800,000 of the Deferred Discount,”.

  

Except as expressly modified herein, all of the terms of the Underwriting Agreement shall remain in full force and effect.

 

This Agreement will be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed within the State of New York. THE COMPANY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

This Amendment may be signed in one or more counterparts, each of which shall constitute an original and all of which together shall constitute one and the same agreement.

 

[ Signature Page Follows ]

 

 

 

 

If the foregoing is in accordance with your understanding of our agreement, kindly indicate your acceptance in the space provided for that purpose below, whereupon it will become a binding agreement among the Company and the several Underwriters in accordance with its terms.

 

  Very truly yours,
   
  GTY TECHNOLOGY HOLDINGS INC.
   
  By: /s/ Harry L. You
    Name: Harry L. You
    Title:   President and Chief Financial Officer
     

 

 

 

 

The foregoing Amendment

is hereby confirmed and accepted as

of the date first above written.

 

 

Citigroup Global Markets Inc.    
   
By: /s/ Neil Shah  
  Name: Neil Shah  
  Title:

Managing Director

 

 
For itself and the other several Underwriters named in Schedule I to the Underwriting Agreement.    

 

 

 

​
EXHIBIT 2.1​
EXECUTION VERSION​
AMENDMENT NO. 1 TO THE AMENDED AND RESTATED AGREEMENT AND
PLAN OF MERGER
This Amendment No. 1 (this “ Amendment ”) to that certain Amended and Restated Agreement and Plan of Merger (the “ Merger Agreement ”), dated as of December 28, 2018, by and among eCivis Inc., a Delaware corporation (the “ Company ”), GTY Technology Holdings Inc., a Cayman Islands exempted company (“ GTY ”), GTY EC Merger Sub, Inc., a Delaware corporation (“ Merger Sub ”), and Kirk Fernandez (“ Mr. Fernandez ”), in his capacity as the eCivis Holders’ Representative (and, pursuant to the newly added Section 1.11(c) and 1.11(f) of the Merger Agreement as set forth in Section 6 below, in his individual capacity), is effective as of January 8, 2019. All capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Merger Agreement.
R E C I T A L S
WHEREAS, the Company, GTY, Merger Sub and Mr. Fernandez are Parties to the Merger Agreement; and
WHEREAS, the Parties desire to amend the Merger Agreement as set forth below.
NOW, THEREFORE, in consideration of the mutual execution hereof and other good and valuable consideration, the parties hereto agree as follows:
1.    Amendment of Section 1.2(b) of the Merger Agreement .    Section 1.2(b) of the Merger Agreement is hereby amended and restated in its entirety to read:
“ eCivis Shares . Each eCivis Share issued and outstanding immediately prior to the Effective Time shall be automatically converted into the right to receive (i) the Pro Rata Portion of the Merger Shares, less the Escrow Shares, payable to the holder thereof in accordance with the procedures set forth in Section 1.3 , (ii) the Pro Rata Portion of the Cash Consideration, payable to the holder thereof in accordance with the procedures set forth in Section 1.3 , (iii) the Pro Rata Portion of the Escrow Shares, if any, that are distributed to the holder thereof pursuant to the terms of this Agreement, the Escrow Agreement or otherwise, as and when such distributions are required to be made, (iv) the Pro Rata Portion of the Purchase Price Escrow Amount, if any, that is distributed to the holder thereof pursuant to the terms of this Agreement, the Escrow Agreement or otherwise, as and when such distributions are required to be made, (v) the Pro Rata Portion of the Cash Escrow Amount, if any, that is distributed to the holder thereof pursuant to the terms of this Agreement, the Escrow Agreement or otherwise, as and when such distributions are required to be made, (vi) the Pro Rata Portion of the CostTree Earn-out Escrow Amount, if any, that is distributed to the holder thereof pursuant to the terms of this Agreement, the Escrow Agreement or otherwise, as and when such distributions are required to be made and (vii) the Pro Rata Portion of an amount, if any, equal to the Earnout Amount (which shall be calculated and payable in accordance with Exhibit A ) (collectively, the “ Per Share Merger Consideration ”), and the holders thereof shall cease to have any further rights as holders of eCivis Shares.”
2.    Amendment of Section 1.8 of the Merger Agreement .    Section 1.8 of the Merger Agreement is hereby amended and restated in its entirety to read:
“ Withholding .   GTY, the Surviving Company, the Exchange Agent and their Affiliates shall be entitled to deduct and withhold from any consideration payable or otherwise deliverable pursuant to this Agreement to any Person (including payments of the Cash Purchase Price, the Cash Escrow Amount and the CostTree Earn-out Escrow Amount) such amounts as GTY, the Surviving Company, the Exchange Agent, or any Affiliate thereof shall determine in good faith they are required to deduct and withhold therefrom under the Code, or under any provision of state, local or foreign Tax Law; provided , however , that GTY shall provide the eCivis Holders’ Representative with written notice of any such intended withholding at least fifteen (15) days before the making of such payment (other than
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withholding on amounts properly treated as compensation for U.S. federal income Tax purposes), and GTY shall cooperate in good faith with the eCivis Holders’ Representative to obtain any available exception from, or reduction in, such withholding to the extent permitted under applicable Law. To the extent such amounts are so deducted or withheld and paid over to the appropriate Governmental Body, such deducted or withheld amounts shall be treated for all purposes under this Agreement as having been paid to the Person to whom such amounts would otherwise have been paid. Notwithstanding anything in this Agreement to the contrary, any amounts payable pursuant to this Agreement that constitute compensation for U.S. federal income Tax purposes shall be paid through (and any applicable withholding shall be managed through) the Company’s ordinary payroll procedures.”
3.    Amendment of Section 6.3(f) of the Merger Agreement .    Section 6.3(f) of the Merger Agreement is hereby amended and restated in its entirety to read:
“GTY shall have deposited the Purchase Price Escrow Amount, the Cash Escrow Amount and the CostTree Earn-out Escrow Amount with the Escrow Agent;”
4.    Amendment of Article 9 of the Merger Agreement .    Article 9 is hereby amended by adding the following definition in alphabetical order to such Article 9 :
“ CostTree Agreement ” means the Asset Purchase Agreement, dated March 12, 2018, by and among Cost Tree, LLC, a California limited liability company (“ CostTree ”), CostTree Holdings LLC, a California limited liability, and the Company.
“ CostTree Earn-out ” means the “Earn-out” (as defined in the CostTree Agreement), payable, if at all, pursuant to the terms of the CostTree Agreement. For the avoidance of doubt, any amounts payable to Nicolie Lettini (“ Ms. Lettini ”) pursuant to the terms of the Lettini Employment Agreement shall not be considered part of the CostTree Earn-out; it being understood that any such amounts shall be considered compensation to Ms. Lettini as an employee of the Company.
“ CostTree Earn-out Escrow Amount ” has the meaning set forth in Section 1.11(a) .
“ Lettini Employment Agreement ” means the Employment Agreement, dated March 12, 2018, between the Company and Nicolie Lettini.
5.    Amendment to Certain Definitions in the Merger Agreement .
(a)   The definition of  “ Final Cash Consideration ” in Section 1.5(e) of the Merger Agreement shall be amended and restated to mean “an amount equal to: (i) the Cash Purchase Price, less (ii) the Closing Date Indebtedness amount as set forth in the Final Purchase Price Adjustment Statement, less (iii) the Purchase Price Escrow Amount, less (iv) the Cash Escrow Amount, less (v) the CostTree Earn-out Escrow Amount, plus (vi) the Closing Date Cash as set forth in the Final Purchase Price Adjustment Statement, plus (vii) the Aggregate Option Exercise Price.”
(b)   The definition of  “ Cash Consideration ” in Article 9 of the Merger Agreement shall be amended and restated to mean “an amount equal to: (i) the Cash Purchase Price, less (ii) the Estimated Closing Indebtedness Amount, less (iii) the Purchase Price Escrow Amount, less (iv) the Cash Escrow Amount, less (v) the CostTree Earn-out Escrow Amount plus (vi) the Estimated Closing Cash Amount, plus (vii) the Aggregate Option Exercise Price.”
(c)   The definition of  “ Closing Date Indebtedness ” in Article 9 of the Merger Agreement shall be amended and restated to mean “the Debt of the Company and its Subsidiaries as of 11:59 P.M. on the date immediately prior to the Closing Date; provided, however, that Closing Date Indebtedness shall not include the CostTree Earn-out, it being understood that the CostTree Earn-out shall be subject to the escrow and payment terms set forth in Section 1.11 of this Agreement.”
(d)   Clause (e) to the definition of  “ Debt ” in Article 9 of the Merger Agreement is hereby amended and restated to read as follows: “(e) obligations for the deferred purchase price of property or services, including, without limitation, the amounts payable with respect to earnouts, purchase price adjustments or other payments related to acquisitions, if and to the extent payable.”
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(e)   Clause (ii) to the definition of  “ Earnout Amount ” in Exhibit A of the Merger Agreement is hereby amended and restated to read as follows: “$10.00.”
6.    CostTree Earn-out Payments and Escrow .   The following terms shall be added as Section 1.11 to the Merger Agreement:
“Section 1.11 CostTree Earn-out .
(a)   GTY shall deposit $1,000,000 (the “ CostTree Earn-out Escrow Amount ”) with the Escrow Agent, which amount shall be held and used solely for the purposes of paying the CostTree Earn-out if, when and to the extent payable to CostTree under the terms of the CostTree Agreement. Prior to the Closing, GTY and the eCivis Holders’ Representative shall either (i) enter into an escrow agreement with the Escrow Agent, setting forth the terms and conditions of the escrow of the CostTree Earn-out Escrow Amount or (ii) amend the Escrow Agreement so that it includes terms and conditions with respect to the escrow of the CostTree Earn-out Escrow Amount, in each case in such form of agreement or amendment, as applicable, as mutually agreed by the parties and consistent with the terms of this Section 1.11 .
(b)   If and when GTY believes or is informed by CostTree that a CostTree Earn-out is earned and payable under the CostTree Agreement, GTY shall promptly notify the eCivis Holders’ Representative in writing of the same and GTY and the eCivis Holders’ Representative shall jointly instruct the Escrow Agent in writing to release to GTY from the escrow the amount of the CostTree Earn-out Escrow Amount as is required to pay any such earned CostTree Earn-out payments (to the extent such funds are available in such escrow). GTY shall cause the Company to pay the Cost-Tree Earn-out when earned and payable under the CostTree Agreement.
(c)   If the then available CostTree Earn-out Escrow Amount is insufficient to satisfy the CostTree Earn-out payments if and when due under the CostTree Agreement, then Mr. Fernandez shall pay to GTY (for the purpose of satisfying such CostTree Earn-out payments) any CostTree Earn-out amounts due and payable that are in excess of such available CostTree Earn-out Escrow Amount. The foregoing shall not limit GTY’s right to indemnification under clause (iv) of Section 7.1(a) of this Agreement; provided that, for the avoidance of doubt, GTY shall not be entitled to double recovery for any amounts paid.
(d)   If any amount of the CostTree Earn-out Escrow Amount remains in escrow on April 1, 2023 (which is the day following the last day on which any CostTree Earn-out payment, if any, is payable under the CostTree Agreement), then GTY and the eCivis Holders’ Representative shall instruct the Escrow Agent to release such remaining amount to the eCivis Holders’ Representative (for the benefit of the eCivis Holders), which the eCivis Holders’ Representative shall cause to be distributed to the eCivis Holders in accordance with their respective Pro Rata Portion.
(e)   GTY and the Company shall not modify or waive any terms, conditions or covenants of the CostTree Earn-out under the CostTree Agreement without the prior written consent of Mr. Fernandez, which consent shall not be unreasonably withheld, conditioned or delayed.
(f)   Mr. Fernandez hereby represents and warrants to GTY, Merger Sub as of the date of this Amendment and as of the Closing Date as follows:
(i)   Mr. Fernandez is an adult individual, is sui juris and has all legal capacity to execute and deliver this Agreement and to perform his obligations hereunder. This Agreement has been duly executed and delivered by Mr. Fernandez, and assuming the due authorization, execution and delivery of the same by each other party hereto, this Agreement shall constitute the valid and legally binding obligation of Mr. Fernandez, enforceable against him in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and similar Laws affecting creditors generally and by the availability of equitable remedies.
(ii)   The execution, delivery and performance of this Agreement and the incurrence of the obligations hereunder does not and will not, directly or indirectly, (a) violate or conflict with any Law or Order applicable to Mr. Fernandez,; (b) conflict with, result in a breach of, constitute a
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default under (with or without notice, lapse of time or both), result in the acceleration of, create in any party the right to accelerate, terminate, modify, not renew or cancel, or require any notice or payment under any Contract, Consent or Permit to which Mr. Fernandez is a party or by which any of his assets are bound or subject; or (c) require any notice to, filing with, or Permit or Consent of any Governmental Body or any other Person.
(iii)   Mr. Fernandez has had the opportunity to, and has, reviewed this Agreement with the counsel of his choosing.
(iv)   Mr. Fernandez is solvent and the execution of this Agreement does not and will not render him insolvent. At all times following the Closing, Mr. Fernandez will have sufficient funds to pay all obligations under Section 1.11(c), if and when due.”
7.    Amendment to Company’s Disclosure Schedule .   There shall be added to the Company’s Disclosure Schedule the disclosures set forth on Exhibit A hereto. The disclosures set forth in Exhibit A shall be deemed to be disclosed and incorporated by reference in each of the other schedules of the Company’s Disclosure Schedule as though fully set forth in such other schedules, and shall be deemed to qualify and limit all representations and warranties of the Company to the Merger Agreement. Notwithstanding anything in the Merger Agreement to the contrary (including Section 4.5 of the Merger Agreement), the failure to previously disclose such matters set forth in Exhibit A hereto (i) shall not be deemed a breach of the Company’s representations and warranties under the Merger Agreement, (ii) shall not be a basis for, or considered for purposes of, determining the satisfaction of the conditions in Article 6 of the Merger Agreement and (iii) shall not be the basis for termination of the Merger Agreement by GTY pursuant to Section 8.1(f) of the Merger Agreement.
8.    Miscellaneous .
(a)   From and after the date hereof, each reference in the Merger Agreement to “this Agreement,” “hereunder,” “hereof,” “herein,” or words of like import, shall mean and be a reference to the Merger Agreement as amended hereby.
(b)   Except as specifically set forth above, the Merger Agreement shall remain unaltered and in full force and effect and the respective terms, conditions or covenants thereof are hereby in all respects ratified and confirmed.
(c)   This Amendment may be executed simultaneously in one or more counterparts, any one of which need not contain the signatures of more than one party, but all such counterparts taken together shall constitute one and the same Amendment.
(d)   Sections 10.5 through 10.15 of the Merger Agreement apply to this Amendment mutatis mutandis .
[signature pages follow]
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IN WITNESS WHEREOF, the parties hereto have executed and deliver this Amendment on the date first written above.
​ ​ ​ ​ ECIVIS INC. ​
​ ​ ​ ​ By: ​ ​ /s/ James Ha ​
​ ​ ​ ​ ​ ​ ​ Name: ​ ​ James Ha ​
​ ​ ​ ​ ​ ​ ​ Title: ​ ​ Chief Executive Officer ​
​ ​ ​ ​ GTY TECHNOLOGY HOLDINGS INC. ​
​ ​ ​ ​ By: ​ ​ /s/ Harry L. You ​
​ ​ ​ ​ ​ ​ ​ Name: ​ ​ Harry L. You ​
​ ​ ​ ​ ​ ​ ​ Title: ​ ​ President and CFO ​
​ ​ ​ ​ GTY EC MERGER SUB, INC. ​
​ ​ ​ ​ By: ​ ​ /s/ Harry L. You ​
​ ​ ​ ​ ​ ​ ​ Name: ​ ​ Harry L. You ​
​ ​ ​ ​ ​ ​ ​ Title: ​ ​ ​ ​
​ ​ ​ ​
KIRK FERNANDEZ , in his capacity as eCivis Holders’ Representative (and, pursuant to Sections 1.11(c) and 1.11(f) of the Merger Agreement as set forth in Section 6 of this Amendment, in his individual capacity)
​
​ ​ ​ ​ By: ​ ​ /s/ Kirk Fernandez ​
​ ​ ​ ​ ​ ​ ​ Name: ​ ​ Kirk Fernandez ​
[Signature Page to Amendment No.2 to Agreement and Plan of Merger]
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EXHIBIT A
Disclosure Schedule Supplement
The following items are added to the sections of the Company’s Disclosure Schedule referenced below:
Section 2.6
(iii)
The Company entered into the CostTree Agreement and the Lettini Employment Agreement in March 2018.
(iv)
The CostTree Agreement includes obligations to pay the CostTree Earn-out, if any, based on the Company’s achievement of certain revenue thresholds during the 2018, 2019, 2020, 2021 and 2022 fiscal years related to the acquired CostTree business, subject in all respects to the terms and conditions of the CostTree Agreement.
(vii)
The Company entered into the Lettini Employment Agreement in connection with its acquisition of the CostTree business.
(xv)
The Company acquired the business of CostTree pursuant to the CostTree Agreement in March 2018.
Section 2.12
(a)(i)
The CostTree Agreement and the Lettini Employment Agreement
(a)(v)
The CostTree Agreement
(a)(viii)
The CostTree Agreement includes obligations to pay the CostTree Earn-out, if any, based on the Company’s achievement of certain revenue thresholds during the 2018, 2019, 2020, 2021 and 2022 fiscal years related to the acquired CostTree business, subject in all respects to the terms and conditions of the CostTree Agreement.
Section 2.15
Pursuant to the Lettini Employment Agreement, Nicolie Lettini is entitled to certain variable compensation based on the Company’s achievement of certain revenues, as more specifically set forth therein.
Section 2.16
(a)
Lettini Employment Agreement, which provides for, among other things, compensation terms, bonus terms and severance terms.
   
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EXHIBIT 10.1​
FORM OF
SUBSCRIPTION AGREEMENT
GTY Technology Holdings Inc.
1180 North Town Center Drive, Suite 100
Las Vegas, Nevada 89144
Ladies and Gentlemen:
GTY Technology Holdings Inc., a Cayman Islands exempted company (“ GTY ”), has entered into agreements (collectively, the “ Business Combination Agreements ”) for a business combination (the “ Business Combination ”) with CityBase, Inc., Bonfire Interactive Ltd., eCivis Inc., Open Counter Enterprises Inc., Questica Inc. and Questica USCDN Inc. and Sherpa Government Solutions LLC (collectively, the “ Targets ”). In connection with the Business Combination, GTY is seeking commitments from interested investors to purchase Class A ordinary shares of GTY, par value $0.0001 per share (“ Class A Ordinary Shares ”), for a purchase price of  $10.00 per share, in a private placement (the “ Private Placement ”). The undersigned wishes to purchase Class A Ordinary Shares in such private placement on the terms and conditions set forth herein, and, accordingly, the undersigned and GTY hereby agree as follows:
1. Subscription .
(a) The undersigned hereby irrevocably subscribes for and agrees to purchase from GTY, and GTY agrees to issue and sell to the undersigned, such number of Ordinary Shares as is set forth on the signature page of this Subscription Agreement (the “ Subscribed Shares ”), for a purchase price of $10.00 per share, on the terms and conditions set forth herein.
(b) [Immediately prior to the issuance of the Subscribed Shares, GTY Investors, LLC, a Delaware limited liability company (the “ Sponsor ”), will surrender to GTY for cancellation for no consideration a number of Class B ordinary shares of GTY, par value $0.0001 per share (together with the Class A Ordinary Shares, the “ Ordinary Shares ”), rounded down to the nearest whole share, equal to 7.5% of the number of Subscribed Shares (the “ Cancelled Shares ”). Concurrently with the issuance of the Subscribed Shares, in consideration for the undersigned’s acquisition of the Subscribed Shares, GTY shall issue to the undersigned such number of Class A Ordinary Shares equal to the number of Cancelled Shares (such shares together with the Subscribed Shares, the “ Shares ”).] 1
(c) [The undersigned represents and warrants to GTY that it currently is the legal and beneficial owner of the number of Class A Ordinary Shares specified as “ Owned Shares ” on the signature page of this Subscription Agreement. In consideration for GTY’s agreement to issue the Shares to the undersigned, the undersigned agrees that it will not sell, transfer, pledge or otherwise dispose of any such Owned Shares prior to the closing of the Business Combination, and will not seek redemption of any such Owned Shares in connection with the Business Combination.] 2
2. Closing .   The closing of the sale of the Shares contemplated hereby (the “ Closing ”) shall occur on the date of, and immediately prior to, the consummation of the Business Combination. Upon (i) satisfaction of the conditions set forth in Section 3 below and (ii) not less than five (5) business days’ written notice from (or on behalf of) GTY to the undersigned (the “ Closing Notice ”) that GTY reasonably expects all conditions to the closing of the Business Combination to be satisfied on a date that is not less than five (5) business days from the date of the Closing Notice, the undersigned shall deliver to GTY on or prior to 8:00 a.m. (Eastern time) (or, if the undersigned advises GTY that under law, rule or regulation
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1
Included in subscription agreements for (i) the purchase of an aggregate of 1,556,248 Subscribed Shares where the subscribers also agreed to continue to hold and not redeem an aggregate of 1,532,215 Owned Shares pursuant to Section 1(c), and (ii) the purchase of an aggregate of 100,000 Subscribed Shares where the Subscribers had no Owned Shares.
​
2
Included in subscription agreements for the purchase of an aggregate of 1,556,248 Subscribed Shares.
​
​
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applicable to the undersigned it must have custody of the Shares before funding, as soon as practicable after GTY or its transfer agent provides the undersigned with written notice evidencing the issuance to the undersigned of the Shares) on the closing date specified in the Closing Notice, or such later date as GTY specifies in a subsequent notice to the undersigned (the “ Closing Date ”), the subscription amount for the Shares subscribed by wire transfer of United States dollars in immediately available funds to the account specified by GTY in the Closing Notice against delivery to the undersigned of  (i) the Shares in book entry form in the name of the undersigned (or its nominee in accordance with its delivery instructions) as set forth in the following sentence and (ii) written notice from (or on behalf of) GTY to the undersigned evidencing the issuance to the undersigned of the Shares on and as of the Closing Date. GTY shall deliver (or cause the delivery of) the Shares in book entry form to the undersigned or to a custodian designated by the undersigned, as applicable. This Subscription Agreement shall terminate and be of no further force or effect, without any liability to either party hereto, if GTY notifies the undersigned in writing that it has abandoned its plans to move forward with the Business Combination and/or terminates the undersigned’s obligations without the delivery of the Shares having occurred.
3. Closing Conditions .
(a) The Closing shall be subject to the satisfaction or valid waiver by each party of the conditions that, on the Closing Date:
(i) no suspension of the qualification of the Shares for offering or sale or trading in any jurisdiction, or initiation or threatening of any proceedings for any of such purposes, shall have occurred other than in connection with the consummation of the Business Combination;
(ii) no applicable governmental authority shall have enacted, issued, promulgated, enforced or entered any judgment, order, law, rule or regulation (whether temporary, preliminary or permanent) which is then in effect and has the effect of making consummation of the transactions contemplated hereby illegal or otherwise restraining or prohibiting consummation of the transactions contemplated hereby, and no governmental authority shall have instituted or threatened in writing a proceeding seeking to impose any such restraint or prohibition; and
(iii) all conditions precedent to the closing of the Business Combination, including the approval of GTY’s shareholders, shall have been satisfied or waived (other than those conditions which, by their nature, are to be satisfied at the closing of the Business Combination, including without limitation as a result of the Private Placement).
(b) The obligation of GTY to consummate the transactions contemplated hereby at the Closing shall be subject to the satisfaction or valid waiver by GTY of the additional conditions that, on the Closing Date, with respect to the undersigned:
(i) all representations and warranties of the undersigned contained in this Subscription Agreement shall be true and correct in all material respects (other than representations and warranties that are qualified as to materiality or Subscriber Material Adverse Effect (as defined below), which representations and warranties shall be true in all respects) at and as of the Closing Date (except for such representations and warranties that are made as of a specific date, which shall be true and correct in all material respects (other than representations and warranties that are qualified as to materiality or Subscriber Material Adverse Effect, which representations and warranties shall be true in all respects) as of such specified date); and
(ii) the undersigned shall have performed, satisfied and complied in all material respects with all covenants, agreements and conditions required by this Subscription Agreement to be performed, satisfied or complied with by it at or prior to the Closing.
(c) The obligation of the undersigned to consummate the transactions contemplated hereby at the Closing shall be subject to the satisfaction or valid waiver by the undersigned of the additional conditions that, on the Closing Date:
(i) all representations and warranties of GTY contained in this Subscription Agreement shall be true and correct in all material respects (other than the representations and warranties in Section 5(a) through 5(d) and those that are qualified as to materiality or GTY Material Adverse
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Effect (as defined below), which representations and warranties shall be true in all respects) at and as of the Closing Date (except for such representations and warranties that are made as of a specific date, which shall be true and correct in all material respects (other than the representations and warranties in Section 5(a) through (d) and those that are qualified as to materiality or GTY Material Adverse Effect, which representations and warranties shall be true in all respects) as of such specified date); and
(ii) GTY shall have performed, satisfied and complied in all material respects with all covenants, agreements and conditions required by this Subscription Agreement to be performed, satisfied or complied with by it at or prior to the Closing
4. Further Assurances .   At the Closing, the parties hereto shall execute and deliver such additional documents and take such additional actions as the parties reasonably may deem to be practical and necessary in order to consummate the subscription as contemplated by this Subscription Agreement.
5. GTY Representations and Warranties .   GTY represents and warrants to the undersigned that:
(a) GTY is an exempted company duly incorporated and validly existing and in good standing as an exempted company under the laws of the Cayman Islands, with corporate power and authority to own, lease and operate its properties and conduct its business as presently conducted and to enter into, deliver and perform its obligations under this Subscription Agreement.
(b) The Shares have been duly authorized and, when issued and delivered to the undersigned against full payment therefor in accordance with the terms of this Subscription Agreement and registered in the register of members of GTY, will be validly issued, fully paid and non-assessable and will not have been issued in violation of or subject to any preemptive or similar rights created under GTY’s memorandum and articles of association (as amended) or under the laws of the Cayman Islands.
(c) This Subscription Agreement has been duly authorized, executed and delivered by GTY and, assuming the due authorization, execution and deliver of the same by the undersigned, is the valid and legally binding obligation of GTY, enforceable against GTY in accordance with its terms, except as may be limited or otherwise affected by (i) bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other laws relating to or affecting the rights of creditors generally, and (ii) principles of equity, whether considered at law or equity.
(d) The execution, delivery and performance by GTY of this Subscription Agreement, the issuance and sale of the Shares and the compliance by GTY with all of the provisions of this Subscription Agreement and the consummation of the transactions herein will be done in accordance with the Nasdaq marketplace rules and will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any of the property or assets of GTY or any of its subsidiaries pursuant to the terms of  (i) any indenture, mortgage, deed of trust, loan agreement, lease, license or other agreement or instrument to which GTY or any of its subsidiaries is a party or by which GTY or any of its subsidiaries is bound or to which any of the property or assets of GTY is subject, which would have a material adverse effect on the business, financial condition, stockholders’ equity or results of operations of GTY, taken as a whole, or the ability of GTY to consummate the transactions contemplated hereby, including the issuance and sale of the Subscribed Shares (a “ GTY Material Adverse Effect ”); (ii) result in any violation of the provisions of the organizational documents of GTY; or (iii) result in any violation of any statute or any judgment, order, rule or regulation of any court or governmental agency or body, domestic or foreign, having jurisdiction over GTY or any of its properties that would have a GTY Material Adverse Effect.
(e) GTY has not entered into any agreement or arrangement entitling any agent, broker, investment banker, financial advisor or other person to any broker’s or finder’s fee or any other commission or similar fee in connection with the transactions contemplated by this Subscription Agreement for which the undersigned could become liable.
(f) GTY is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental
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authority, self-regulatory organization (including Nasdaq) or other person in connection with the execution, delivery and performance by GTY of this Subscription Agreement (including, without limitation, the issuance of the Shares), other than (i) the filing with the SEC of the Registration Statement (as defined below), (ii) filings required by applicable state securities laws, (iii) if applicable, the filing of a Notice of Exempt Offering of Securities on Form D with the SEC under Regulation D promulgated under the Securities Act of 1933, as amended (the “ Securities Act ”), (iv) a filing with the SEC of a Current Report on Form 8-K disclosing all material terms of the transactions contemplated hereby, the Business Combination and any other material, non-public information that GTY, any placement agent for the sale of the Shares or any of their respective representatives has provided to the undersigned, (v) filings or approvals required by Nasdaq and (vi) those the failure of which to obtain would not be reasonably likely to have, individually or in the aggregate, a GTY Material Adverse Effect.
(g) The authorized and issued capital stock of GTY are as set forth in GTY’s annual report on Form 10-K for the year ended December 31, 2017 (the “ 2017 10-K ”). All (i) issued and outstanding Ordinary Shares have been duly authorized and validly issued, are fully paid and are non-assessable and are not subject to preemptive rights. Except as set forth in the 2017 10-K, other subscription agreements for the Private Placement and the Business Combination Agreements, there are no outstanding options, warrants or other rights to subscribe for, purchase or acquire from GTY any Ordinary Shares or other equity interests in GTY (collectively, “ Equity Interests ”) or securities convertible into or exchangeable or exercisable for Equity Interests.
(h) GTY has made available to the undersigned (including via the SEC’s EDGAR system) a copy of each form, report, statement, schedule, prospectus, proxy, registration statement and other document filed by GTY with the SEC since its initial registration of the Ordinary Shares. None of GTY’s filings with the SEC under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), contained, when filed or, if amended, as of the date of such amendment with respect to those disclosures that are amended, any untrue statement of a material fact or omitted to state a 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. GTY has filed each report that GTY was required to file with the SEC since its inception. There are no outstanding or unresolved comments in comment letters from the SEC staff with respect to any of GTY’s filings with the SEC.
(i) The issued and outstanding Class A Ordinary Shares are registered pursuant to Section 12(b) of the Exchange Act and are listed for trading on the Nasdaq under the symbol “GTYH.” There is no suit, action, proceeding or investigation pending or, to the knowledge of GTY, threatened against GTY by Nasdaq or the SEC with respect to any intention by such entity to deregister the Class A Ordinary Shares or prohibit or terminate the listing of the Class A Ordinary Shares on Nasdaq.
(j) GTY is not, and immediately after receipt of payment for the Shares will not be, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.
(k) Except for the specific representations and warranties contained in this Section 5 and in any certificate or agreement delivered pursuant hereto, none of GTY, any person on behalf of GTY, including without limitation any placement agent for the sale of the Shares, or any of GTY’s affiliates (collectively, the “ GTY Parties ”) has made, makes or shall be deemed to make any other express or implied representation or warranty with respect to GTY, Fastball, this offering or the Business Combination, and GTY Parties disclaim any such representation or warranty. Except for the specific representations and warranties expressly made by the undersigned in Section 6 and in any certificate or agreement delivered pursuant hereto, GTY specifically disclaim that it, or anyone on its behalf, is are relying upon any other representations or warranties that may have been made by any Subscriber Party (as defined below).
6. Subscriber Representations and Warranties .   The undersigned represents and warrants to GTY that:
(a) The undersigned (i) is duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation, (ii) has the requisite power and authority to enter into and perform its obligations under this Subscription Agreement.
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(b) This Subscription Agreement has been duly executed and delivered by the undersigned, and assuming the due authorization, execution and delivery of the same by GTY, this Subscription Agreement shall constitute the valid and legally binding obligation of the undersigned, enforceable against the undersigned in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors generally and by the availability of equitable remedies.
(c) The execution and delivery of this Subscription Agreement, the purchase of the Subscribed Shares and the compliance by the undersigned with all of the provisions of this Subscription Agreement and the consummation of the transactions contemplated herein will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any of the property or assets of the undersigned pursuant to the terms of  (i) any indenture, mortgage, deed of trust, loan agreement, lease, license or other agreement or instrument to which the undersigned is a party or by which the undersigned is bound or to which any of the property or assets of the undersigned is subject; (ii) the organizational documents of the undersigned; or (iii) any statute or any judgment, order, rule or regulation of any court or governmental agency or body, domestic or foreign, having jurisdiction over the undersigned or any of its properties that, in the case of clauses (i) and (iii), would reasonably be expected to have a material adverse effect on the undersigned’s ability to consummate the transactions contemplated hereby, including the purchase of the Subscribed Shares (a “ Subscriber Material Adverse Effect ”).
(d) The undersigned (i) is an institutional “accredited investor” (within the meaning of Rule 501(a) under the Securities Act), (ii) is acquiring the Subscribed Shares only for its own account and not for the account of others, and (iii) is not acquiring the Subscribed Shares with a view to, or for offer or sale in connection with, any distribution thereof in violation of the Securities Act (and has provided GTY with such information as reasonably requested related to its qualification as an accredited investor). The undersigned is not an entity formed for the specific purpose of acquiring the Subscribed Shares.
(e) The undersigned understands that the Subscribed Shares are being offered in a transaction not involving any public offering within the meaning of the Securities Act and that the Subscribed Shares have not been registered under the Securities Act. The undersigned understands that the Subscribed Shares may not be resold, transferred, pledged or otherwise disposed of by the undersigned absent an effective registration statement under the Securities Act, except (i) to GTY or a subsidiary thereof, or (ii) pursuant to an applicable exemption from the registration requirements of the Securities Act, and, in each of cases (i) and (ii), in accordance with any applicable securities laws of the states and other jurisdictions of the United States, and that any certificates or book-entry position representing the Subscribed Shares shall contain a legend to such effect. The undersigned understands that it has been advised to consult legal counsel prior to making any offer, resale, pledge or transfer of any of the Subscribed Shares.
(f) The undersigned understands and agrees that the undersigned is purchasing the Subscribed Shares directly from GTY. The undersigned further acknowledges that there have not been, and the undersigned is not relying on, any representations, warranties, covenants and agreements made to the undersigned by GTY, any other party to the Business Combination or any other person or entity, expressly or by implication, other than those representations, warranties, covenants and agreements of GTY included in this Subscription Agreement.
(g) In making its decision to purchase the Subscribed Shares, the undersigned has relied solely upon independent investigation made by the undersigned. The undersigned acknowledges and agrees that the undersigned has received such information as the undersigned deems necessary in order to make an investment decision with respect to the Subscribed Shares, including with respect to GTY, the Business Combination and the Targets. The undersigned represents and agrees that the undersigned and the undersigned’s professional advisor(s), if any, have had the full opportunity to ask such questions, receive such answers and obtain such information as the undersigned and the undersigned’s professional advisor(s), if any, have deemed necessary to make an investment decision with respect to the Subscribed Shares.
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(h) The undersigned became aware of this offering of the Subscribed Shares solely by means of direct contact between the undersigned and GTY or by means of contact from the Placement Agents, and the Subscribed Shares were offered to the undersigned solely by direct contact between the undersigned and GTY or by contact between the undersigned and the Placement Agents. The undersigned did not become aware of this offering of the Subscribed Shares, nor were the Subscribed Shares offered to the undersigned, by any other means.
(i) The undersigned acknowledges that it is aware that there are substantial risks incident to the purchase and ownership of the Subscribed Shares. The undersigned has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the Subscribed Shares, and the undersigned has sought such accounting, legal and tax advice as the undersigned has considered necessary to make an informed investment decision.
(j) The undersigned has adequately analyzed and fully considered the risks of an investment in the Subscribed Shares and determined that the Subscribed Shares are a suitable investment for the undersigned and that the undersigned is able at this time and in the foreseeable future to bear the economic risk of a total loss of the undersigned’s investment in GTY. The undersigned acknowledges specifically that a possibility of total loss exists.
(k) The undersigned understands and agrees that no federal or state agency has passed upon or endorsed the merits of the offering of the Subscribed Shares or made any findings or determination as to the fairness of this investment.
(l) The undersigned does not have, as of the date hereof, and during the 30-day period immediately prior to the date hereof the undersigned has not entered into, any “put equivalent position” as such term is defined in Rule 16a-1 under the Exchange Act or short sale positions with respect to the securities of GTY.
(m) The undersigned acknowledges and agrees that, to the extent the Subscribed Shares are not included in the registration statement on Form S-4 to be filed by GTY in connection with the Transaction (the “ Form S-4 ”), the certificate or book-entry position representing the Subscribed Shares will bear or reflect, as applicable, a legend substantially similar to the following:
“THIS SECURITY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) PURSUANT TO ANY EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, (II) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, OR (III) TO THE COMPANY, IN EACH OF CASES (I) THROUGH (III) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL NOTIFY ANY SUBSEQUENT PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE. THE COMPANY MAY REQUIRE THE DELIVERY OF A WRITTEN OPINION OF COUNSEL, CERTIFICATIONS AND/OR ANY OTHER INFORMATION IT REASONABLY REQUIRES TO CONFIRM THE SECURITIES ACT EXEMPTION FOR SUCH TRANSACTION.”
(n) The undersigned’s acquisition and holding of the Shares will not constitute or result in a non-exempt prohibited transaction under Section 406 of the Employee Retirement Income Security Act of 1974, as amended, Section 4975 of the Internal Revenue Code of 1986, as amended (the “ Code ”), or any applicable similar law.
(o) If the undersigned is not a U.S. person as defined in Rule 902 under the Securities Act or a United States person as defined in the Code, the undersigned hereby represents that it has satisfied itself as to the full observance of the laws of its jurisdiction in connection with any invitation to
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subscribe for the Shares or any use of this Subscription Agreement, including (i) the legal requirements within its jurisdiction for the purchase of the Shares, (ii) any foreign exchange restrictions applicable to such purchase, (iii) any governmental or other consents that may need to be obtained, and (iv) the income tax and other tax consequences, if any, that may be relevant to the purchase, holding, redemption, sale, or transfer of the Shares. The undersigned’s subscription and payment for and continued beneficial ownership of the Shares will not violate any applicable securities or other laws of the undersigned’s jurisdiction.
(p) The undersigned is not (i) a person or entity named on the List of Specially Designated Nationals and Blocked Persons administered by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) or in any Executive Order issued by the President of the United States and administered by OFAC (“ OFAC List ”), or a person or entity prohibited by any OFAC sanctions program, (ii) a Designated National as defined in the Cuban Assets Control Regulations, 31 C.F.R. Part 515, or (iii) a non-U.S. shell bank or providing banking services indirectly to a non-U.S. shell bank (collectively, a “ Prohibited Investor ”). The undersigned agrees to provide law enforcement agencies, if requested thereby, such records as required by applicable law, provided that the undersigned is permitted to do so under applicable law. If the undersigned is a financial institution subject to the Bank Secrecy Act (31 U.S.C. Section 5311 et seq.) (the “BSA”), as amended by the USA PATRIOT Act of 2001 (the “ PATRIOT Act ”), and its implementing regulations (collectively, the “ BSA/PATRIOT Act ”), the undersigned maintains policies and procedures reasonably designed to comply with applicable obligations under the BSA/PATRIOT Act. To the extent required, it maintains policies and procedures reasonably designed for the screening of its investors against the OFAC sanctions programs, including the OFAC List. To the extent required, it maintains policies and procedures reasonably designed to ensure that the funds held by the undersigned and used to purchase the Shares were legally derived.
(q) Except for the specific representations and warranties contained in this Section 6 and in any certificate or agreement delivered pursuant hereto, none of the undersigned nor any person acting on behalf of the undersigned nor any of the undersigned’s affiliates (the “ Subscriber Parties ”) has made, makes or shall be deemed to make any other express or implied representation or warranty with respect to the undersigned and this offering, and the Subscriber Parties disclaim any such representation or warranty. Except for the specific representations and warranties expressly made by GTY in Section 5 of this Agreement and in any certificate or agreement delivered pursuant hereto, the undersigned specifically disclaims that it, or anyone on its behalf, is relying upon any other representations or warranties that may have been made by any GTY Party.
7. Registration Rights .   GTY shall use commercially reasonable efforts to include the Shares in the S-4. In the event that the Shares are not included in the S-4, GTY agrees that, within seven (7) calendar days after the consummation of the Business Combination, GTY will file with the SEC (at GTY’s sole cost and expense) a registration statement registering the resale of the Shares issued to the undersigned (the “ Registration Statement ”), and GTY shall use its commercially reasonable efforts to have the Registration Statement declared effective as soon as practicable after the filing thereof. GTY agrees that it will cause such registration statement or another shelf registration statement to remain effective until the earlier of (i) two years from the issuance of the Shares, or (ii) on the first date on which the undersigned can sell all of the Shares (or shares received in exchange therefor) under Rule 144 of the Securities Act within 90 days without limitation as to the amount of such securities that may be sold. GTY may delay filing or suspend the use of any such registration statement if GTY delivers to the holders of Shares a certificate signed by an officer of GTY certifying that, in the good faith judgment of the board of directors of GTY, such registration and the offering pursuant thereto would reasonably be expected to materially adversely affect or materially interfere with any bona fide material financing or transaction of GTY or would require disclosure of information that has not been disclosed to the public, the premature disclosure of which would materially adversely affect GTY. Such certificate shall contain a statement of the reasons for such postponement and an approximation of the anticipated delay. The holders receiving such certificate shall keep the information contained in such certificate confidential. GTY’s obligations to include the Shares (or shares issued in exchange therefor) in the Registration Statement are contingent upon the undersigned furnishing in writing to GTY such information regarding the undersigned, the securities of GTY held by the undersigned and the intended method of disposition of the Shares as shall be reasonably requested by
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GTY to effect the registration of the Shares, and shall execute such documents in connection with such registration as GTY may reasonably request that are customary of a selling stockholder in similar situations.
8. Termination .   This Subscription Agreement shall terminate and be void and of no further force and effect, and all rights and obligations of the parties hereunder shall terminate without any further liability on the part of any party in respect thereof upon the earlier to occur of  (a) such date and time as all of the Business Combination Agreements are terminated in accordance with their terms, (b) upon the mutual written agreement of each of the parties hereto to terminate this Subscription Agreement or (c) if the Closing does not occur on or before [           ], 2019; provided that nothing herein will relieve any party from liability for any willful breach hereof prior to the time of termination, and each party will be entitled to any remedies at law or in equity to recover losses, liabilities or damages arising from such breach. GTY shall promptly notify the undersigned of the termination of the Business Combination Agreements promptly after the termination thereof.
9. Additional Agreements and Waivers of the Undersigned .
(a) The undersigned acknowledges that, as described in GTY’s prospectus relating to its initial public offering (the “ Prospectus ”) available at www.sec.gov, substantially all of GTY’s assets consist of the cash proceeds of GTY’s initial public offering and private placements of its securities, that substantially all of those proceeds have been deposited in a trust account (the “ Trust Account ”) for the benefit of GTY, its public shareholders and the underwriters of GTY’s initial public offering and that the cash in the Trust Account may be disbursed only for the purposes set forth in the Prospectus. For and in consideration of GTY entering into this Subscription Agreement, the sufficiency of which is hereby acknowledged, the undersigned hereby irrevocably waives any and all right, title and interest, or any claim of any kind it has or may have in the future, in or to any monies or assets held in the Trust Account (and any distributions therefrom to GTY’s public shareholders), and agrees not to seek recourse against the Trust Account (or any distributions therefrom to GTY’s public shareholders) as a result of, or arising out of, this Subscription Agreement, or for any other reason whatsoever.
(b) The undersigned hereby agrees that neither it, nor any person or entity acting on its behalf or pursuant to any understanding with it, will engage in any Short Sales with respect to securities of GTY prior to the Closing. For purposes of this Section 9(b), “ Short Sales ” shall include, without limitation, all “short sales” as defined in Rule 200 promulgated under Regulation SHO under the Exchange Act, and all types of direct and indirect stock pledges (other than pledges in the ordinary course of business as part of prime brokerage arrangements), forward sale contracts, options, puts, calls, swaps and similar arrangements (including on a total return basis), and sales and other transactions through non-U.S. broker dealers or foreign regulated brokers.
10. Miscellaneous .
(a) All notices and other communications given or made pursuant to this Subscription Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual receipt, or (a) personal delivery to the party to be notified, (b) when sent, if sent by electronic mail or facsimile (if provided), during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next business day, (c) five (5) business days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) business day after deposit with a nationally recognized overnight courier, freight prepaid, specifying next business day delivery, with written verification of receipt. All communications sent to GTY shall be sent to: 1180 North Town Center Drive, Suite 100, Las Vegas, Nevada 89144, Attn: Harry You, email: harry@gtytechnology.com, with a copy to GTY’s counsel at: Winston & Strawn LLP, 200 Park Avenue, New York, NY 10166, Attn: Joel L. Rubinstein, Esq., email: jrubinstein@winston.com.
All communications to the undersigned shall be sent to the undersigned address as set forth on the signature page hereof, or to such e-mail address, facsimile number (if any) or address as subsequently modified by written notice given in accordance with this Section 10(a).
(a) Neither this Subscription Agreement nor any rights that may accrue to the undersigned hereunder (other than the Shares acquired hereunder, if any) may be transferred or assigned. Neither this Subscription Agreement nor any rights that may accrue to GTY or to any placement agent for the sale of the Shares hereunder may be transferred or assigned.
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(b) GTY may request from the undersigned such additional information as GTY may deem necessary to evaluate the eligibility of the undersigned to acquire the Shares, and the undersigned shall provide such information as may reasonably be requested, to the extent readily available and to the extent consistent with its internal policies and procedures.
(c) The undersigned acknowledges that GTY and any placement agent for the sale of the Shares will rely on the acknowledgments, understandings, agreements, representations and warranties contained in this Subscription Agreement. Prior to the Closing, the undersigned agrees to promptly notify GTY if any of the acknowledgments, understandings, agreements, representations and warranties set forth herein are no longer accurate in all material respects. The undersigned agrees that the purchase by the undersigned of the Shares from GTY at the Closing will constitute a reaffirmation of the acknowledgments, understandings, agreements, representations and warranties herein (as modified by any such notice) by the undersigned as of the time of such purchase. The undersigned further acknowledges and agrees that any placement agent for the sale of the Shares is a third-party beneficiary of the representations and warranties of the undersigned contained in Section 6 of this Subscription Agreement. GTY acknowledges that the undersigned will rely on the acknowledgments, understandings, agreements, representations and warranties contained in this Subscription Agreement. Prior to the Closing, GTY agrees to promptly notify the undersigned if any of the acknowledgements, understandings, agreements, representations and warranties set forth herein are no longer accurate in all material respects. GTY agrees that the sale by it of the Shares to the undersigned at the Closing will constitute a reaffirmation of the acknowledgments, understandings, agreements, representations and warranties herein (as modified by any such notice) by the undersigned as of the time of such sale.
(d) Each of GTY and the undersigned is entitled to rely upon this Subscription Agreement and is irrevocably authorized to produce this Subscription Agreement or a copy hereof to any interested party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby.
(e) All the agreements, representations and warranties made by each party hereto in this Subscription Agreement shall survive the Closing.
(f) This Subscription Agreement may not be modified, waived or terminated except by an instrument in writing, signed by the party against whom enforcement of such modification, waiver, or termination is sought.
(g) This Subscription Agreement constitutes the entire agreement, and supersedes all other prior agreements, understandings, representations and warranties, both written and oral, among the parties, with respect to the subject matter hereof. Except as specifically set forth herein, this Subscription Agreement shall not confer any rights or remedies upon any person other than the parties hereto, and their respective successor and assigns.
(h) Except as otherwise provided herein, this Subscription Agreement shall be binding upon, and inure to the benefit of the parties hereto and their heirs, executors, administrators, successors, legal representatives, and permitted assigns, and the agreements, representations, warranties, covenants and acknowledgments contained herein shall be deemed to be made by, and be binding upon, such heirs, executors, administrators, successors, legal representatives and permitted assigns.
(i) If any provision of this Subscription Agreement shall be invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions of this Subscription Agreement shall not in any way be affected or impaired thereby and shall continue in full force and effect.
(j) This Subscription Agreement may be executed in one or more counterparts (including by facsimile or electronic mail or in .pdf) and by different parties in separate counterparts, with the same effect as if all parties hereto had signed the same document. All counterparts so executed and delivered shall be construed together and shall constitute one and the same agreement.
(k) The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Subscription Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction
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or injunctions to prevent breaches of this Subscription Agreement and to enforce specifically the terms and provisions of this Subscription Agreement, this being in addition to any other remedy to which such party is entitled at law, in equity, in contract, in tort or otherwise.
(l) THIS SUBSCRIPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS THAT WOULD OTHERWISE REQUIRE THE APPLICATION OF THE LAW OF ANY OTHER STATE. THE PARTIES (I) HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMIT TO THE JURISDICTION OF THE STATE COURTS OF NEW YORK AND TO THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT, (B) AGREE NOT TO COMMENCE ANY SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT EXCEPT IN STATE COURTS OF NEW YORK OR THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, AND (C) HEREBY WAIVE, AND AGREE NOT TO ASSERT, BY WAY OF MOTION, AS A DEFENSE, OR OTHERWISE, IN ANY SUCH SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT SUBJECT PERSONALLY TO THE JURISDICTION OF THE ABOVE-NAMED COURTS, THAT ITS PROPERTY IS EXEMPT OR IMMUNE FROM ATTACHMENT OR EXECUTION, THAT THE SUIT, ACTION OR PROCEEDING IS BROUGHT IN AN INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS IMPROPER OR THAT THIS AGREEMENT OR THE SUBJECT MATTER HEREOF MAY NOT BE ENFORCED IN OR BY SUCH COURT. EACH PARTY HERETO HEREBY WAIVES ANY RIGHT TO A JURY TRIAL IN CONNECTION WITH ANY LITIGATION PURSUANT TO THIS SUBSCRIPTION AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY.
(m) GTY agrees that it will not, without the prior written consent of the undersigned, use in advertising or otherwise use publicly the name of the undersigned with respect to this Subscription Agreement; provided, however, that GTY may file any required securities filings with respect to the transactions contemplated by this Subscription Agreement. Notwithstanding the foregoing, GTY may identify the undersigned (i) as required by law, (ii) in information and documents submitted to its stockholders seeking required consents or waivers to transactions or other actions that require such consent or waiver, and (iii) other non-public communications with third parties where disclosure of the capitalization of GTY is required.
11. Exculpation .   The undersigned agrees that no other subscriber for Ordinary Shares of GTY in connection with the Business Combination, nor any placement agent in connection with the sale of the Shares, shall be liable to the undersigned for any action heretofore or hereafter taken or omitted to be taken by any of them in connection therewith.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF , the undersigned has executed or caused this Subscription Agreement to be executed by its duly authorized representative as of the date set forth below.
​ ​ ​ ​
​ Name of Investor: ____________________ ​ ​ State/Country of Formation or Domicile: _________________________________ ​
​ By: ______________________________ ​ ​
​ Name: ___________________________ ​ ​
​ Title: ____________________________ ​ ​
​ Name in which shares are to be registered (if different): ______________________ ​ ​ Date: ____________________________ ​
​ Investor’s EIN: ____________________ ​ ​
​ Business Address-Street: ​ ​ Address-Street for Notices (if different): ​
​ __________________________________ ​ ​ __________________________________ ​
​ __________________________________ ​ ​ __________________________________ ​
​ City, State, Zip: ​ ​ City, State, Zip: ​
​ ________________________________ ​ ​ __________________________________ ​
​ Attn: ____________________________ ​ ​ Attn:_____________________________ ​
​ Telephone No.: ____________________ ​ ​ Telephone No.: ____________________ ​
​ Facsimile No.: _____________________ ​ ​ Facsimile No.: ____________________ ​
​ E-Mail: __________________________ ​ ​ E-Mail: __________________________ ​
​ Number of Class A Ordinary Shares subscribed for: ____________________ ​ ​
​ Aggregate Subscription Amount: $________________________________ ​ ​ Price Per Share: $10.00 ​
​ Number of Owned Shares: _________ ​ ​
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IN WITNESS WHEREOF , GTY Technology Holdings Inc. [and, solely for purposes of Section 1(b), GTY Investors, LLC,] 3 have accepted this Subscription Agreement as of the date set forth below.
GTY TECHNOLOGY HOLDINGS INC.
By:
​
 Name:
 Title:
[GTY INVESTORS, LLC
By:
​
 Name:
 Title:
Date: [          ] , 2018
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3
Included in subscription agreements for the purchase of an aggregate of 1,656,248 Subscribed Shares.
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