Delaware
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333-141884
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76-0168604
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(State of incorporation or organization)
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(Commission File
Number) |
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(I.R.S. Employer Identification No.)
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3100 Main Street, Suite 900
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Houston, TX, 77002
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713 335-5151
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(Address of principal executive offices)
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(Registrant’s Telephone Number)
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Item 2.03
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Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
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Exhibit No.
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Description
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4.1
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4.2
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10.1
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10.2
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10.3
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10.4
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10.5
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10.6
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PROS HOLDINGS, INC.
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Date: May 7, 2019
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/s/ Damian Olthoff
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Damian Olthoff
General Counsel and Secretary |
Exhibit No.
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Description
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4.1
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4.2
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10.1
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10.2
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10.3
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10.4
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10.5
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10.6
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Article 1
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DEFINITIONS
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Section 1.01.
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Definitions
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Section 1.02.
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References to Interest
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Article 2
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ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES
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Section 2.01.
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Designation and Amount
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Section 2.02.
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Form of Notes
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Section 2.03.
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Date and Denomination of Notes; Payments of Interest and Defaulted Amounts
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Section 2.04.
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Execution, Authentication and Delivery of Notes
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Section 2.05.
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Exchange and Registration of Transfer of Notes; Restrictions on Transfer; Depositary
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Section 2.06.
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Mutilated, Destroyed, Lost or Stolen Notes
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Section 2.07.
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Temporary Notes
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Section 2.08.
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Cancellation of Notes Paid, Converted, Etc.
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Section 2.09.
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CUSIP Numbers
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Section 2.10.
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Additional Notes; Repurchases
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Article 3
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SATISFACTION AND DISCHARGE
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Section 3.01.
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Satisfaction and Discharge
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Article 4
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PARTICULAR COVENANTS OF THE COMPANY
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Section 4.01.
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Payment of Principal and Interest
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Section 4.02.
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Maintenance of Office or Agency
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Section 4.03.
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Appointments to Fill Vacancies in Trustee’s Office
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Section 4.04.
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Provisions as to Paying Agent
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Section 4.05.
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Existence
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Section 4.06.
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Rule 144A Information Requirement and Annual Reports
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Section 4.07.
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Stay, Extension and Usury Laws
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Section 4.08.
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Compliance Certificate; Statements as to Defaults
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Section 4.09.
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Further Instruments and Acts
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Article 5
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LISTS OF HOLDERS AND REPORTS BY THE COMPANY AND THE TRUSTEE
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Section 5.01.
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Lists of Holders
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Section 5.02.
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Preservation and Disclosure of Lists
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Article 6
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DEFAULTS AND REMEDIES
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Section 6.01.
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Events of Default
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Section 6.02.
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Acceleration; Rescission and Annulment
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Section 6.03.
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Additional Interest
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Section 6.04.
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Payments of Notes on Default; Suit Therefor
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Section 6.05.
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Application of Monies Collected by Trustee
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Section 6.06.
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Proceedings by Holders
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Section 6.07.
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Proceedings by Trustee
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Section 6.08.
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Remedies Cumulative and Continuing
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Section 6.09.
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Direction of Proceedings and Waiver of Defaults by Majority of Holders
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Section 6.10.
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Notice of Defaults
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Section 6.11.
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Undertaking to Pay Costs
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Article 7
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CONCERNING THE TRUSTEE
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Section 7.01.
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Duties and Responsibilities of Trustee
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Section 7.02.
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Reliance on Documents, Opinions, Etc.
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Section 7.03.
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No Responsibility for Recitals, Etc.
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Section 7.04.
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Trustee, Paying Agents, Conversion Agents, Bid Solicitation Agent or Note Registrar May Own Notes
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Section 7.05.
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Monies and Shares of Common Stock to Be Held in Trust
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Section 7.06.
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Compensation and Expenses of Trustee
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Section 7.07.
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Officer’s Certificate as Evidence
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Section 7.08.
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Eligibility of Trustee
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Section 7.09.
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Resignation or Removal of Trustee
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Section 7.10.
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Acceptance by Successor Trustee
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Section 7.11.
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Succession by Merger, Etc.
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Section 7.12.
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Trustee’s Application for Instructions from the Company
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Article 8
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CONCERNING THE HOLDERS
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Section 8.01.
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Action by Holders
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Section 8.02.
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Proof of Execution by Holders
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Section 8.03.
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Who Are Deemed Absolute Owners
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Section 8.04.
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Company-Owned Notes Disregarded
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Section 8.05.
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Revocation of Consents; Future Holders Bound
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Article 9
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HOLDERS’ MEETINGS
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Section 9.01.
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Purpose of Meetings
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Section 9.02.
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Call of Meetings by Trustee
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Section 9.03.
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Call of Meetings by Company or Holders
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Section 9.04.
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Qualifications for Voting
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Section 9.05.
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Regulations
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Section 9.06.
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Voting
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Section 9.07.
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No Delay of Rights by Meeting
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Article 10
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SUPPLEMENTAL INDENTURES
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Section 10.01.
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Supplemental Indentures Without Consent of Holders
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Section 10.02.
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Supplemental Indentures with Consent of Holders
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Section 10.03.
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Effect of Supplemental Indentures
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Section 10.04.
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Notation on Notes
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Section 10.05.
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Evidence of Compliance of Supplemental Indenture to Be Furnished Trustee
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Article 11
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CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
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Section 11.01.
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Company May Consolidate, Etc. on Certain Terms
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Section 11.02.
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Successor Corporation to Be Substituted
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Section 11.03.
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Opinion of Counsel to Be Given to Trustee
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Article 12
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IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
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Section 12.01.
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Indenture and Notes Solely Corporate Obligations
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Article 13
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[INTENTIONALLY OMITTED]
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Article 14
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CONVERSION OF NOTES
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Section 14.01.
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Conversion Privilege
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Section 14.02.
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Conversion Procedure; Settlement Upon Conversion
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Section 14.03.
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Increased Conversion Rate Applicable to Certain Notes Surrendered in Connection with Make-Whole Fundamental Changes or a Notice of Redemption
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Section 14.04.
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Adjustment of Conversion Rate
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Section 14.05.
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Adjustments of Prices
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Section 14.06.
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Shares to Be Fully Paid
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Section 14.07.
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Effect of Recapitalizations, Reclassifications and Changes of the Common Stock
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Section 14.08.
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Certain Covenants
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Section 14.09.
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Responsibility of Trustee
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Section 14.10.
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Notice to Holders Prior to Certain Actions
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Section 14.11.
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Stockholder Rights Plans
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Section 14.12.
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Limit on Company Actions that Increases the Conversion Rate
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Section 14.13.
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Exchange in Lieu of Conversion
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Article 15
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REPURCHASE OF NOTES AT OPTION OF HOLDERS
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Section 15.01.
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[Intentionally Omitted]
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Section 15.02.
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Repurchase at Option of Holders Upon a Fundamental Change
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Section 15.03.
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Withdrawal of Fundamental Change Repurchase Notice
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Section 15.04.
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Deposit of Fundamental Change Repurchase Price
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Section 15.05.
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Covenant to Comply with Applicable Laws Upon Repurchase of Notes
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Article 16
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OPTIONAL REDEMPTION
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Section 16.01.
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Optional Redemption
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Section 16.02.
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Notice of Optional Redemption
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Section 16.03.
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Payment of Notes Called for Redemption
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Section 16.04.
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Restrictions on Redemption
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Article 17
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MISCELLANEOUS PROVISIONS
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Section 17.01.
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Provisions Binding on Company’s Successors
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Section 17.02.
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Official Acts by Successor Corporation
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Section 17.03.
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Addresses for Notices, Etc.
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Section 17.04.
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Governing Law; Jurisdiction
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Section 17.05.
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Evidence of Compliance with Conditions Precedent; Certificates and Opinions of Counsel to Trustee
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Section 17.06.
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Legal Holidays
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Section 17.07.
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No Security Interest Created
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Section 17.08.
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Benefits of Indenture
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Section 17.09.
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Table of Contents, Headings, Etc.
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Section 17.10.
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Authenticating Agent
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Section 17.11.
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Execution in Counterparts
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Section 17.12.
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Severability
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Section 17.13.
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Waiver of Jury Trial
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Section 17.14.
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Force Majeure
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Section 17.15.
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Calculations
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Section 17.16.
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U.S.A. Patriot Act
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Section 17.17.
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Tax Information
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Section 17.18.
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U.S. Federal Income Tax Reporting Obligations in Connection with Conversion Rate Adjustments
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Exhibit A:
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Form of Note
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CR
1
= CR
0
X
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OS
1
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OS
0
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CR
0
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= the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date of such dividend or distribution, or immediately prior to the open of business on the Effective Date of such share split or share combination, as applicable;
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CR
1
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= the Conversion Rate in effect immediately after the open of business on such Ex-Dividend Date or Effective Date, as the case may be;
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OS
0
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= the number of shares of Common Stock outstanding immediately prior to the open of business on such Ex-Dividend Date or Effective Date, as the case may be; and
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OS
1
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= the number of shares of Common Stock outstanding immediately after giving effect to such dividend, distribution, share split or share combination, as the case may be.
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CR
1
= CR
0
X
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OS
0
+ X
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OS
0
+ Y
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CR
0
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= the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date for such issuance;
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CR
1
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= the Conversion Rate in effect immediately after the open of business on such Ex-Dividend Date;
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OS
0
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= the number of shares of Common Stock outstanding immediately prior to the open of business on such Ex-Dividend Date;
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X
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= the total number of shares of Common Stock issuable pursuant to such rights, options or warrants; and
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Y
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= the number of shares of Common Stock equal to the aggregate price payable to exercise such rights, options or warrants,
divided by
the average of the Last Reported Sale Prices of the Common Stock over the 10 consecutive Trading Day period ending on, and including, the Trading Day immediately preceding the announcement date of the issuance of such rights, options or warrants.
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CR
1
= CR
0
X
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SP
0
-
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SP
0
- FMV
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CR
0
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= the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date for such distribution;
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CR
1
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= the Conversion Rate in effect immediately after the open of business on such Ex-Dividend Date;
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SP
0
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= the average of the Last Reported Sale Prices of the Common Stock over the 10 consecutive Trading Day period ending on, and including, the Trading Day immediately preceding the Ex-Dividend Date for such distribution; and
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FMV
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= the fair market value (as determined in good faith by the Board of Directors) of the Distributed Property with respect to each outstanding share of the Common Stock on the Ex-Dividend Date for such distribution.
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CR
1
= CR
0
X
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FMV
0
+ MP
0
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MP
0
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CR
0
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= the Conversion Rate in effect immediately prior to the end of the Valuation Period;
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CR
1
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= the Conversion Rate in effect immediately after the end of the Valuation Period;
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FMV
0
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= the average of the Last Reported Sale Prices of the Capital Stock or similar equity interest distributed to holders of the Common Stock applicable to one share of the Common Stock (determined by reference to the definition of Last Reported Sale Price as set forth in Section 1.01 as if references therein to Common Stock were to such Capital Stock or similar equity interest) over the first 10 consecutive Trading Day period after, and including, the Ex-Dividend Date of the Spin-Off (the “
Valuation Period
”); and
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MP
0
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= the average of the Last Reported Sale Prices of the Common Stock over the Valuation Period.
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CR
1
= CR
0
X
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SP
0
-
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SP
0
- C
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CR
0
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= the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date for such dividend or distribution;
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CR
1
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= the Conversion Rate in effect immediately after the open of business on the Ex-Dividend Date for such dividend or distribution;
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SP
0
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= the Last Reported Sale Price of the Common Stock on the Trading Day immediately preceding the Ex-Dividend Date for such dividend or distribution; and
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C
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= the amount in cash per share the Company distributes to all or substantially all holders of the Common Stock.
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CR
1
= CR
0
X
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AC + (SP
1
X OS
1
)
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OS
0
X SP
1
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CR
0
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= the Conversion Rate in effect immediately prior to the close of business on the 10th Trading Day immediately following, and including, the Trading Day next succeeding the date such tender or exchange offer expires;
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CR
1
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= the Conversion Rate in effect immediately after the close of business on the 10th Trading Day immediately following, and including, the Trading Day next succeeding the date such tender or exchange offer expires;
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AC
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= the aggregate value of all cash and any other consideration (as determined in good faith by the Board of Directors) paid or payable for shares of Common Stock purchased in such tender or exchange offer;
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OS
0
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= the number of shares of Common Stock outstanding immediately prior to the date such tender or exchange offer expires (prior to giving effect to the purchase of all shares of Common Stock accepted for purchase or exchange in such tender or exchange offer);
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OS
1
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= the number of shares of Common Stock outstanding immediately after the date such tender or exchange offer expires (after giving effect to the purchase of all shares of Common Stock accepted for purchase or exchange in such tender or exchange offer); and
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SP
1
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= the average of the Last Reported Sale Prices of the Common Stock over the 10 consecutive Trading Day period commencing on, and including, the Trading Day next succeeding the date such tender or exchange offer expires.
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PROS HOLDINGS, INC.
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By:
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_______________________________
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Name: Damian Olthoff
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Title: General Counsel and Secretary
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WILMINGTON TRUST,
NATIONAL ASSOCIATION, as Trustee
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By:
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_______________________________
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Name:
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Title:
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PROS HOLDINGS, INC.
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By:
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_______________________________
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Name:
Title:
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Dated:
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TRUSTEE’S CERTIFICATE OF AUTHENTICATION
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WILMINGTON TRUST, NATIONAL ASSOCIATION
as Trustee, certifies that this is one of the Notes described
in the within-named Indenture.
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By:______________________________
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Authorized Signatory
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Date of exchange
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Amount of decrease in principal amount of this Global Note
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Amount of increase in principal amount of this Global Note
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Principal amount of this Global Note following such decrease or increase
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Signature of authorized signatory of Trustee or Custodian
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Dated:
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Signature(s)
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Signature Guarantee
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Signature(s) must be guaranteed by an eligible Guarantor Institution (banks, stock brokers, savings and loan associations and credit unions) with membership in an approved signature guarantee medallion program pursuant to Securities and Exchange Commission Rule 17Ad-15 if shares of Common Stock are to be issued, or Notes are to be delivered, other than to and in the name of the registered holder.
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Fill in for registration of shares if to be issued, and Notes if to be delivered, other than to and in the name of the registered holder:
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(Name)
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(Street Address)
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(City, State and Zip Code)
Please print name and address
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Principal amount to be converted (if less than all): $ ,000
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NOTICE: The above signature(s) of the Holder(s) hereof must correspond with the name as written upon the face of the Note in every particular without alteration or enlargement or any change whatever.
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Social Security or Other Taxpayer
Identification Number
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Dated:
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Signature(s)
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Social Security or Other Taxpayer Identification Number
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Principal amount to be repaid (if less than all): $
_____
,000
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NOTICE: The above signature(s) of the Holder(s) hereof must correspond with the name as written upon the face of the Note in every particular without alteration or enlargement or any change whatever.
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Dated:
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Signature(s)
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Signature Guarantee
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Signature(s) must be guaranteed by an eligible Guarantor Institution (banks, stock brokers, savings and loan associations and credit unions) with membership in an approved signature guarantee medallion program pursuant to Securities and Exchange Commission Rule 17Ad-15 if Notes are to be delivered, other than to and in the name of the registered holder.
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1.
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The Company represents and warrants to, and agrees with, each of the Purchasers that:
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(a)
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A preliminary offering memorandum, dated April 30, 2019 (the “
Preliminary Offering Memorandum
”), and an offering memorandum, dated May 1, 2019 (the “
Offering Memorandum
”), have been prepared in connection with the offering of the Securities and Underlying Shares, if any, issuable upon conversion thereof. The Preliminary Offering Memorandum, as amended and supplemented immediately prior to the Applicable Time (as defined in Section 1(b)), is hereinafter referred to as the “
Pricing Memorandum
”. Any reference to the Preliminary Offering Memorandum, the Pricing Memorandum or the Offering Memorandum shall be deemed to refer to and include all documents filed with the United States Securities and Exchange Commission (the “
Commission
”) pursuant to Section 13(a), 13(c) or 15(d) of the United States Securities Exchange Act of 1934, as amended (the “
Exchange Act
”), on or prior to the date of such memorandum and incorporated by reference therein and any reference to the Preliminary Offering Memorandum or the Offering Memorandum, as the case may be, as amended or supplemented, as of any specified date, shall be deemed to include (i) any documents filed with the Commission pursuant to Section 13(a), 13(c) or 15(d) of the Exchange Act after the date of the Preliminary Offering Memorandum or the Offering Memorandum, as the case may be, and prior to such specified date and (ii) any Additional Issuer Information (as defined in Section 5(f)) furnished by the Company prior to the completion of the distribution of the Securities; and all documents filed under the Exchange Act and so deemed to be included in the Preliminary Offering Memorandum, the Pricing Memorandum or the Offering Memorandum, as the case may be, or any amendment or supplement thereto are hereinafter called the “
Exchange Act Reports
” (provided that where only sections of such documents are specifically incorporated by reference, only such sections shall be considered to be part of the “Exchange Act Reports”). The Exchange Act Reports, when they were or are filed with the Commission, conformed or will conform in all material respects to the applicable requirements of the Exchange Act and the applicable rules and regulations of the Commission thereunder at the time of filing; and no such documents were filed with the Commission since the Commission’s close of business on the business day immediately prior to the date of this Agreement and prior to the execution of this Agreement, except as set forth on Schedule II(a) hereof. The Preliminary Offering Memorandum and the Offering Memorandum and any amendments or supplements thereto and the Exchange Act Reports did not and will not, as of their respective dates, contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;
provided
,
however
, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by a Purchaser through the Representative expressly for use therein;
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(b)
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For the purposes of this Agreement, the “
Applicable Time
” is 11:30 p.m. (Eastern time) on the date of this Agreement; the Pricing Memorandum as supplemented by the information set forth in Schedule III hereto, taken together (collectively, the “
Pricing Disclosure Package
”) as of the Applicable Time, did not include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; and each Company Supplemental Disclosure Document (as defined in Section 6(a)(i)) listed on Schedule II(b) hereto and each Permitted General Solicitation Material (as defined in Section 6(a)(i)) listed on Schedule II(d) hereto) does not conflict with the information contained in the Pricing Memorandum or the Offering Memorandum and each such Company Supplemental Disclosure Document and Permitted General Solicitation Material, as supplemented by and taken together with the Pricing Disclosure Package as of the Applicable Time, did not include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;
provided, however
, that this representation and warranty shall not apply to statements or omissions made in a Company Supplemental Disclosure Document or Permitted General Solicitation Material in reliance upon and in conformity with information furnished in writing to the Company by a Purchaser through the Representative expressly for use therein;
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(c)
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Neither the Company nor any of its subsidiaries has sustained since the date of the latest audited financial statements included in the Pricing Memorandum any material loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Pricing Memorandum; and, since the respective dates as of which information is given in the Pricing Memorandum, there has not been any change in the capital stock, membership interests (other than pursuant to the Company’s equity incentive plans and inducement awards described in the Pricing Memorandum) or long-term debt of the Company or any of its subsidiaries or any material adverse change, or any development involving a prospective material adverse change, in or affecting the general affairs, management, financial position, stockholders’ equity or results of operations of the Company and its subsidiaries, taken as a whole (a “
Material Adverse Effect
”), other than as set forth or contemplated in the Pricing Memorandum;
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(d)
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The Company and its subsidiaries have good and marketable title in fee simple to all real property owned by them and good and marketable title to all personal property owned by them that is material to the business of the Company and its subsidiaries, taken as a whole, in each case free and clear of all liens, encumbrances and defects except such as are described in the Pricing Memorandum or such as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and its subsidiaries; and any real property and buildings held under lease by the Company and its subsidiaries are held by them under valid, subsisting and, to the Company’s knowledge, enforceable leases with such exceptions as are not material and do not materially interfere with the use made and proposed to be made of such property and buildings by the Company and its subsidiaries;
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(e)
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The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Delaware, with power and authority (corporate and other) to own its properties and conduct its business as described in the Pricing Disclosure Package and the Offering Memorandum, and has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each other jurisdiction in which it owns or leases properties or conducts any business so as to require such qualification, except where the failure to be so qualified or in good standing in any such other jurisdiction would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; and each subsidiary of the Company has been duly organized and is validly existing as a corporation or other form of organization in good standing under the laws of its jurisdiction of formation to the extent that the concept of “good standing” (or its functional equivalent) is applicable under the laws of such jurisdiction;
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(f)
|
The Company has an authorized capitalization as set forth in the Pricing Disclosure Package under the heading “Capitalization”, and all of the issued shares of capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; the shares of Stock initially issuable upon conversion of the Securities (assuming physical settlement of all conversions and giving effect to the maximum conversion rate pursuant to any make-whole adjustment (such number of shares, the “
Conversion Shares
”)) have been duly and validly authorized and reserved for issuance and, when issued and delivered in accordance with the provisions of the Securities and the Indenture referred to below, will be duly and validly issued, fully paid and non-assessable and will conform to the description of the Stock contained in the Pricing Disclosure Package and the Offering Memorandum; and all of the issued shares of capital stock or membership interests, as applicable, of each subsidiary of the Company have been duly and validly authorized and issued, are fully paid and non-assessable and (except for directors’ qualifying shares and except as otherwise set forth in the Pricing Disclosure Package) are owned directly or indirectly by the Company, free and clear of all liens, encumbrances, equities or claims;
|
(g)
|
The Securities have been duly authorized by the Company and, when issued and delivered pursuant to this Agreement, will have been duly executed, authenticated, issued and delivered and, when duly authenticated by the trustee under the indenture referred to below, will constitute valid and legally binding obligations of the Company entitled to the benefits provided by the indenture to be dated as of May 7, 2019 (the “
Indenture
”) between the Company and Wilmington Trust, N.A., as Trustee (the “
Trustee
”), under which they are to be issued, which will be substantially in the form previously delivered to you; the Indenture has been duly authorized by the Company and, when executed and delivered by the Company and the Trustee, the Indenture will constitute a valid and legally binding instrument, enforceable against the Company in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency (including, without limitation, all laws relating to fraudulent transfers), reorganization and other laws of general applicability relating to or affecting creditors’ rights, and to general equity principles (regardless of whether enforcement is considered in a proceeding at equity or at law), public policy, applicable laws relating to fiduciary duties and indemnification and implied covenants of good faith and fair dealing, and entitled to the benefits provided by the Indenture; and the Securities and the Indenture will conform in all material respects to the descriptions thereof in the Pricing Disclosure Package and the Offering Memorandum and will be in substantially the form previously delivered to you;
|
(h)
|
The Company has all requisite corporate power to execute, deliver and perform its obligations under this Agreement. This Agreement has been duly and validly authorized, executed and delivered by the Company;
|
(i)
|
None of the transactions contemplated by this Agreement (including, without limitation, the use of the proceeds from the sale of the Securities) will violate or result in a violation of Section 7 of the Exchange Act, or any regulation promulgated thereunder, including, without limitation, Regulations T, U and X of the Board of Governors of the Federal Reserve System;
|
(j)
|
Prior to the date hereof, neither the Company nor any of its affiliates has taken any action that would violate Regulation M under the Exchange Act (“
Regulation M
”) in connection with the offering of the Securities;
|
(k)
|
The issue and sale of the Securities and the compliance by the Company with all of the provisions of the Securities, the Indenture, the Capped Call Confirmations and this Agreement and the consummation of the transactions herein and therein contemplated and the application of the proceeds from the sale of the Securities as described under “Use of Proceeds” in the Pricing Disclosure Package and the Offering Memorandum will not (i) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, that certain Credit Agreement by and among Wells Fargo Bank, National Association, a national banking association, as administrative agent and PROS, Inc., a Delaware corporation, dated as of July 2, 2012, as amended (the “
Credit Agreement
”), including the Tenth Amendment dated as of April 30, 2019 (the “
Credit Agreement Amendment
”), (ii) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under any other indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, (iii) result in any violation of the provisions of the Amended and Restated Certificate of Incorporation or Amended and Restated Bylaws of the Company or (iv) result in any violation of any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any of its subsidiaries or any of their properties, except, in the case of clauses (ii) and (iv), for any conflict, default, breach or violation that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; and no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the issue and sale of the Securities or the consummation by the Company of the transactions contemplated by this Agreement, the Indenture or the Capped Call Confirmations, except such consents, approvals, authorizations, registrations or qualifications as have been obtained prior to the date of this Agreement or may be required (y) under state securities or Blue Sky laws in connection with the purchase and distribution of the Securities by the Purchasers or (z) for listing of the Conversion Shares on the New York Stock Exchange (the “
Exchange
”);
|
(l)
|
Neither the Company nor any of its subsidiaries is (i) in violation of its Amended and Restated Certificate of Incorporation or Amended and Restated Bylaws or (ii) in default in the performance or observance of any obligation, agreement, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement, lease or other agreement or instrument to which it is a party or by which it or any of its properties may be bound, except in the case of clause (ii), for such defaults as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect;
|
(m)
|
The statements set forth in the Pricing Memorandum and the Offering Memorandum under the caption “Description of Notes” and “Description of Capital Stock”, insofar as they purport to constitute a summary of the terms of the Securities and the Stock, and under the caption, “Certain United States Federal Income Tax Considerations”, insofar as they purport to describe the provisions of the laws, legal conclusions and documents referred to therein, fairly and accurately summarize or describe, as applicable, the matters set forth therein;
|
(n)
|
Other than as set forth or described in the Pricing Disclosure Package and the Offering Memorandum, there are no legal or governmental proceedings pending to which the Company or any of its subsidiaries is a party or of which any property of the Company or any of its subsidiaries is the subject which, if determined adversely to the Company or any of its subsidiaries, would individually or in the aggregate have a Material Adverse Effect; and, to the best of the Company’s knowledge, no such proceedings are threatened or contemplated by governmental authorities or threatened by others;
|
(o)
|
When the Securities are issued and delivered pursuant to this Agreement, the Securities will not be of the same class (within the meaning of Rule 144A (“
Rule 144A
”) under the Securities Act of 1933, as amended (the “
Act
”)) as securities which are listed on a national securities exchange registered under Section 6 of the Exchange Act or quoted in a U.S. automated inter-dealer quotation system, and will be eligible for resale under Rule 144A;
|
(p)
|
The Company is subject to Section 13 or 15(d) of the Exchange Act;
|
(q)
|
The Company is not and, after giving effect to the offering and sale of the Securities and the application of the proceeds thereof and the transactions contemplated by the Capped Call Confirmations as described in the Pricing Disclosure Package, will not be an “investment company”, as such term is defined in the United States Investment Company Act of 1940, as amended (the “
Investment Company Act
”);
|
(r)
|
Neither the Company nor any person acting on its behalf (other than the Purchasers, as to which no representation is made) has offered or sold the Securities by means of any general solicitation or general advertising within the meaning of Rule 502(c) under the Act (other than by means of a Permitted General Solicitation, as defined below);
|
(s)
|
Within the preceding six months, neither the Company nor any other person acting on behalf of the Company has offered or sold to any person any Securities, or any securities of the same or a similar class as the Securities, other than Securities offered or sold to the Purchasers hereunder. The Company will take reasonable precautions designed to insure that any offer or sale, direct or indirect, in the United States or to any U.S. person (as defined in Rule 902 under the Act) of any Securities or any substantially similar security issued by the Company, within six months subsequent to the date on which the distribution of the Securities has been completed (as notified to the Company by the Representative), is made under restrictions and other circumstances reasonably designed not to affect the status of the offer and sale of the Securities in the United States and to U.S. persons contemplated by this Agreement as transactions exempt from the registration provisions of the Act;
|
(t)
|
The Company maintains a system of internal control over financial reporting (as such term is defined in Rule 13a-15(f) of the Exchange Act) that complies with the requirements of the Exchange Act and has been designed by the Company’s principal executive officer and principal financial officer, or under their supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States (“
GAAP
”). Except as disclosed in the Pricing Disclosure Package, since the date of the latest audited financial statements included or incorporated by reference in the Pricing Disclosure Package, the Company’s internal control over financial reporting is effective and the Company is not aware of any material weaknesses in its internal control over financial reporting;
|
(u)
|
Except as disclosed in the Pricing Disclosure Package, since the date of the latest audited financial statements included or incorporated by reference in the Pricing Memorandum, there has been no change in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting;
|
(v)
|
The financial statements, including the notes thereto, included or incorporated by reference in the Pricing Disclosure Package present fairly in all material respects the consolidated financial position at the dates indicated and the cash flows and results of operations for the periods indicated of the Company and its consolidated subsidiaries. Except as otherwise stated in the Pricing Disclosure Package, such financial statements have been prepared in conformity with GAAP applied on a consistent basis throughout the periods involved; and the supporting schedules, if any, included or incorporated by reference in the Pricing Disclosure Package present fairly the information required to be stated therein. The other financial information included or incorporated by reference in the Pricing Disclosure Package presents fairly in all material respects the information included therein and has been prepared on a basis consistent with that of the financial statements that are included in the Pricing Disclosure Package and the books and records of the respective entities presented therein;
|
(w)
|
The Company maintains disclosure controls and procedures (as such term is defined in Rule 13a- 15(e) of the Exchange Act) that comply with the applicable requirements of the Exchange Act; such disclosure controls and procedures have been designed to ensure that material information required to be disclosed by the Company in its reports that it submits or files or will submit or file under the Exchange Act is made known to the Company’s principal executive officer and principal financial officer by others within those entities; and such disclosure controls and procedures are effective in all material respects;
|
(x)
|
PricewaterhouseCoopers LLP, which has audited certain financial statements of the Company and its subsidiaries, is an independent registered public accounting firm with respect to the Company and its subsidiaries as required by the Act and the rules and regulations of the Commission thereunder;
|
(y)
|
Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company, any director, officer, agent, employee, affiliate or other person associated with or acting on behalf of the Company or any of its subsidiaries has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977; (iv) violated or is in violation of any provision of the Bribery Act 2010 of the United Kingdom; or (v) made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment;
|
(z)
|
The operations of the Company and its subsidiaries are and, to the knowledge of the Company, the operations of the Company and its subsidiaries have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements, including, but not limited to, the Bank Secrecy Act of 1970, as amended by the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and the rules and regulations promulgated thereunder, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency having jurisdiction over the Company or any of its subsidiaries (collectively, the “
Money Laundering Laws
”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened;
|
(aa)
|
Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company, any director, officer, agent, employee or affiliate of the Company or any of its subsidiaries is currently the subject or the target of any sanctions administered or enforced by the U.S. Government, including, without limitation, the Office of Foreign Assets Control of the U.S. Department of the Treasury (“
OFAC
”), or other relevant sanctions authority (collectively, “
Sanctions
”), and the Company will not directly or indirectly use the proceeds of the offering of the Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity (i) to fund or facilitate any activities of or business with any person, or in any country or territory, that, at the time of such funding, is the subject or target of Sanctions or (ii) in any other manner that will result in a violation by any person (including any person participating in the transaction, whether as underwriter, advisor, investor or otherwise) of Sanctions;
|
(cc)
|
To the Company’s knowledge, there has been no material security breach or incident, unauthorized access or disclosure, or other compromise of or relating to the information technology, software or computer systems used in the business of the Company or its subsidiaries, nor with respect to any confidential information, personally identifiable information or personal data collected, maintained or processed in connection with their businesses. Neither the Company nor any of its subsidiaries has been notified of, nor has knowledge of, any material event or condition that would result in the foregoing. The Company and its subsidiaries have implemented reasonable controls, policies and technological safeguards to guard against, and promptly detect and respond to, any such material instances, including use of commercially reasonable efforts to ensure that all third parties permitted to access any systems, information or data of the Company or its subsidiaries are subject to comparable measures, policies and safeguards;
|
(dd)
|
The Company and its subsidiaries have filed all federal, state, local and foreign income and franchise tax returns required to be filed through the date hereof, taking into account any extensions thereof (except where the failure to file would not, individually or in the aggregate, have a Material Adverse Effect), and have paid all taxes due and payable (except where the failure to pay would not, individually or in the aggregate, have a Material Adverse Effect or except as currently being contested in good faith and for which reserves required by U.S. GAAP have been created in the financial statements of the Company), and no tax deficiency has been determined adversely to the Company or any of its subsidiaries which has had (nor does the Company nor any of its subsidiaries have any notice or knowledge of any tax deficiency which remains unpaid and would reasonably be expected to be determined adversely to the Company or its subsidiaries and which could reasonably be expected to have) a Material Adverse Effect;
|
(ee)
|
Nothing has come to the attention of the Company that has caused the Company to believe that the statistical, industry-related and market-related data included or incorporated by reference in the Pricing Disclosure Package are not based on or derived from sources that are reliable and accurate in all material respects;
|
(ff)
|
No material labor or employment dispute with the employees of the Company or any of its subsidiaries exists, except as described in the Pricing Disclosure Package, or, to the knowledge of the Company, is imminent;
|
(gg)
|
Since the date as of which information is given in the Pricing Disclosure Package, and except as may otherwise be disclosed in the Pricing Disclosure Package, the Company has not (i) issued or granted any securities, other than pursuant to the Company’s equity incentive plans, inducement awards or pursuant to outstanding options, rights or warrants, in each case disclosed in the Pricing Disclosure Package, (ii) incurred any material liability or obligation, direct or contingent, other than liabilities and obligations which were incurred in the ordinary course of business, (iii) entered into any material transaction not in the ordinary course of business (other than the transactions contemplated hereby and the Credit Agreement Amendment) or (iv) declared or paid any dividends on its capital stock;
|
(hh)
|
The Company and each subsidiary are insured against such losses and risks and in such amounts as, in the Company’s reasonable judgment, are prudent and customary in the businesses in which they are engaged; and neither the Company nor any of its subsidiaries has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business;
|
(ii)
|
Except as described in the Pricing Disclosure Package, there are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Act with respect to any securities of the Company owned or to be owned by such person, except as have been validly waived or complied with;
|
(jj)
|
There is and has been no failure on the part of the Company or, to the Company’s knowledge, any of the Company’s directors or officers, in their capacities as such, to comply with any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith (the “
Sarbanes-Oxley Act
”), including Section 402 related to loans and Sections 302 and 906 related to certifications;
|
(kk)
|
The Company and its subsidiaries (i) are in compliance with any and all applicable foreign, federal, state and local laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants (“
Environmental Laws
”), (ii) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses and (iii) are in compliance with all terms and conditions of any such permit, license or approval, except where such noncompliance with Environmental Laws, failure to receive required permits, licenses or other approvals or failure to comply with the terms and conditions of such permits, licenses or approvals would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect;
|
(ll)
|
The Company, to its knowledge, has operated its business in a manner compliant in all material respects with all privacy and data protection laws and regulations applicable to the Company’s collection, handling, and storage of personally identifiable information or personal data (including the European Union General Data Protection Regulation and applicable national laws supplementing the same); and
|
2.
|
Subject to the terms and conditions herein set forth, (a) the Company agrees to issue and sell to each of the Purchasers, and each of the Purchasers agrees, severally and not jointly, to purchase from the Company, at a purchase price of 97.5% of the principal amount thereof (the “
Purchase Price
”), plus accrued interest, if any, from May 7, 2019 to the first Time of Delivery (as defined in Section 4 hereof), the principal amount of Securities set forth opposite the name of such Purchaser in Schedule I hereto, and (b) in the event and to the extent that you on behalf of the Purchasers exercise the election to purchase Optional Securities as provided below, the Company agrees to issue and sell to each of the Purchasers, and each of the Purchasers agrees, severally and not jointly, to purchase from the Company, at the Purchase Price set forth in clause (a) of this Section 2, that portion of the aggregate principal amount of the Optional Securities as to which such election shall have been exercised (to be adjusted by you so as to eliminate fractions of $1,000), determined by multiplying such aggregate principal amount of Optional Securities by a fraction, the numerator of which is the maximum aggregate principal amount of Optional Securities that such Purchaser is entitled to purchase as set forth opposite the name of such Purchaser in Schedule I hereto and the denominator of which is the maximum aggregate principal amount of Optional Securities that all of the Purchasers are entitled to purchase hereunder.
|
3.
|
Upon the authorization by you of the release of the Securities, the several Purchasers propose to offer the Securities for sale upon the terms and conditions set forth in this Agreement and the Offering Memorandum and each Purchaser, acting severally and not jointly, hereby represents and warrants to, and agrees with the Company that:
|
(a)
|
It will sell the Securities only to persons whom it reasonably believes are “qualified institutional buyers” (“
QIBs
”) within the meaning of Rule 144A under the Act in transactions meeting the requirements of Rule 144A;
|
(b)
|
It is an Institutional Accredited Investor, within the meaning of Rule 501(a) under the Act; and
|
(c)
|
Neither it nor any of its affiliates or any other person acting on its or their behalf will solicit offers for, or offer or sell, the Securities by means of any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of Section 4(a)(2) of the Securities Act (other than by means of a Permitted General Solicitation, as defined below).
|
4.
|
|
(a)
|
The Securities to be purchased by each Purchaser hereunder will be represented by one or more definitive global Securities in book-entry form which will be deposited by or on behalf of the Company with The Depository Trust Company (“
DTC
”) or its designated custodian. The Company will deliver the Securities to the Representative, for the account of each Purchaser, against payment by or on behalf of such Purchaser of the purchase price therefor by wire transfer of Federal (same day) funds, by causing DTC to credit the Securities to the account of Goldman Sachs & Co. LLC at DTC. The Company will cause the certificates representing the Securities to be made available to the Representative for checking at least twenty-four hours prior to each Time of Delivery (as defined below) at the office of Cleary Gottlieb Steen & Hamilton LLP, One Liberty Plaza, New York, New York 10006 (the “
Closing Location
”) The time and date of such delivery and payment shall be 9:30 a.m., New York City time, on May 7, 2019 or such other time and date as the Representative and the Company may agree upon in writing, and with respect to the Optional Securities, 9:30 a.m. New York City time, on the date specified by you in the written notice given by the Representative of the Purchasers’ election to purchase such Optional Securities, or such other time and date as the Representative and the Company may agree upon in writing;
provided, however,
that such delivery date must be at least three New York Business Days (as defined below) after such written notice is given and may not be earlier than the First Time of Delivery (as defined below) nor later than ten New York Business Days (as defined below) after the date of such notice;
provided further,
that solely with respect to an Optional Securities written notice that is delivered prior to the First Time of Delivery, the related Time of Delivery (as defined below) must be at least one New York Business Day after the written notice is given. Such time and date for delivery of the Firm Securities are herein called the “
First Time of Delivery
”, any such time and date for delivery of the Optional Securities, if not the First Time of Delivery, are herein called a “
Subsequent Time of Delivery
”, and each such time and date for delivery are herein called a “
Time of Delivery
”.
|
(b)
|
The documents to be delivered at each Time of Delivery by or on behalf of the parties hereto pursuant to Section 8 hereof, including the cross-receipt for the Securities and any additional documents requested by the Purchasers pursuant to Section 8(k) hereof, will be delivered at such time and date at the Closing Location, and the Securities will be delivered at the office of DTC (or its designated custodian), all at such Time of Delivery. A meeting will be held at the Closing Location at 5:00 p.m., New York City time, on the New York Business Day next preceding such Time of Delivery, at which meeting the final drafts of the documents to be delivered pursuant to the preceding sentence will be available for review by the parties hereto. For the purposes of this Section 4, “
New York Business Day
” shall mean each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions in New York are generally authorized or obligated by law or executive order to close.
|
5.
|
The Company agrees with each of the Purchasers:
|
(a)
|
To prepare the Offering Memorandum in a form approved by you; to make no amendment or any supplement to the Offering Memorandum which shall be disapproved by you promptly after reasonable notice thereof; and to furnish you with copies thereof;
|
(b)
|
Promptly from time to time to take such action as you may reasonably request to qualify the Securities and the Underlying Shares for offering and sale under the securities laws of such jurisdictions as you may request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of the Securities, provided that in connection therewith the Company shall not be required to qualify as a foreign corporation or to file a general consent to service of process in any such jurisdiction where it is not presently qualified or where it would as a result be subject to taxation as a foreign corporation;
|
(c)
|
To furnish the Purchasers with written and electronic copies of the Offering Memorandum and any amendment or supplement thereto in such quantities as you may from time to time reasonably request, and if, at any time prior to the expiration of nine months after the date of the Offering Memorandum, any event shall have occurred as a result of which the Offering Memorandum as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such Offering Memorandum is delivered, not misleading, or, if for any other reason it shall be necessary or desirable during such same period to amend or supplement the Offering Memorandum, to notify you and upon your request to prepare and furnish without charge to each Purchaser and to any dealer in securities as many written and electronic copies as you may from time to time reasonably request of an amended Offering Memorandum or a supplement to the Offering Memorandum which will correct such statement or omission or effect such compliance;
|
(d)
|
During the period beginning from the date hereof and continuing until the date that is 60 days after the date of the Offering Memorandum, not to (i) offer, issue, sell, contract to sell, pledge, grant any option to purchase, make any short sale or otherwise transfer or dispose of, directly or indirectly, or file with the Commission a registration statement under the Act relating to any securities of the Company that are substantially similar to the Securities or the Stock, including but not limited to any securities that are convertible into or exchangeable for, or that represent the right to receive, Stock or any such substantially similar securities (other than registration statements on Form S-8 relating to securities granted or to be granted by the Company pursuant to any equity incentive plan or inducement awards), or publicly disclose the intention to make any offer, sale, pledge, disposition or filing or (ii) enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of the Stock or any such other securities, whether any such transaction is to be settled by delivery of Stock or such other securities, in cash or otherwise other than (v) pursuant to the Company’s equity incentive plans and inducement awards existing on, or upon the conversion or exchange of convertible or exchangeable securities outstanding as of, the date of this Agreement and disclosed in the Pricing Memorandum, (w) the issuance by the Company of any Stock upon settlement or termination of, the Company’s warrant transactions that are described in the Pricing Disclosure Package, (x) the issuance of the Securities or any Underlying Shares upon conversion thereof or (y) the sale or issuance of or entry into an agreement to sell or issue shares of Stock in connection with the Company’s or any of its subsidiaries’ acquisition of one or more businesses, products or technologies (whether by means of merger, stock purchase, asset purchase or otherwise) or in connection with joint ventures, commercial relationships or other strategic transactions or pursuant to an employee benefit plan assumed by the Company in connection with any such strategic transaction;
provided
that (A) the aggregate number of shares of Stock that the Company may sell or issue or agree to sell or issue pursuant to this clause (y) shall not exceed 7.5% of the total number of shares of Stock issued and outstanding immediately following the completion of the transactions contemplated by this Agreement and (B) the Company shall (a) cause each recipient of such securities to execute and deliver to the Representative, on or prior to issuance of such securities a lock-up agreement in the form attached hereto as Exhibit A covering the remainder of such 60-day period and (b) enter stop transfer instructions with the Company’s transfer agent and registrar on such securities, which the Company agrees it will not waive or amend without the prior written consent of Goldman Sachs & Co. LLC or (z) with the prior written consent of Goldman Sachs & Co. LLC.
|
(e)
|
Not to be or become, at any time prior to the expiration of one year after the First Time of Delivery, an open-end investment company, unit investment trust, closed-end investment company or face-amount certificate company that is or is required to be registered under Section 8 of the Investment Company Act;
|
(f)
|
At any time when the Company is not subject to Section 13 or 15(d) of the Exchange Act, for the benefit of holders from time to time of Securities, to furnish at its expense, upon request, to holders of Securities and prospective purchasers of Securities information (the “
Additional Issuer Information
”) satisfying the requirements of subsection (d)(4)(i) of Rule 144A under the Act;
|
(g)
|
Except for such documents that are publicly available on EDGAR, to furnish to the holders of the Securities as soon as practicable after the end of each fiscal year an annual report (including a balance sheet and statements of income, stockholders’ equity and cash flows of the Company and its consolidated subsidiaries certified by independent public accountants) and, as soon as practicable after the end of each of the first three quarters of each fiscal year (beginning with the fiscal quarter ending after the date of the Offering Memorandum), to make available to its stockholders consolidated summary financial information of the Company and its subsidiaries for such quarter in reasonable detail;
|
(h)
|
The Company will not, and will not permit any of its controlled “affiliates” (as defined in Rule 144 under the Act) to, resell any of the Securities which constitute “restricted securities” under Rule 144 that have been reacquired by any of them (other than pursuant to a registration statement that has been declared effective under the Act) for a period of one year after the last date of issuance of such Securities (or, if later, the date on which the restrictive legend is removed from the Securities);
|
(i)
|
To use the net proceeds received by the Company from the sale of the Securities pursuant to this Agreement in the manner specified in the Pricing Memorandum under the caption “Use of Proceeds”;
|
(j)
|
To reserve and keep available at all times, free of preemptive rights, shares of Stock for the purpose of enabling the Company to satisfy any obligations to issue shares of its Stock upon conversion of the Securities;
|
(k)
|
To use its reasonable best efforts to list, subject to notice of issuance, the Conversion Shares on the Exchange; and
|
(l)
|
The Company and its affiliates will not take, directly or indirectly, any action prohibited by Regulation M in connection with the offering of the Securities; provided that the Company is not undertaking any responsibility regarding any actions taken by the Purchasers in this regard.
|
6.
|
|
(a)
|
|
(i)
|
The Company represents and agrees that, without the prior consent of the Representative, it and its affiliates and any other person acting on its or their behalf (other than the Purchasers, as to which no statement is given) (x) have not made and will not make any offer relating to the Securities that, if the offering of the Securities contemplated by this Agreement were conducted as a public offering pursuant to a registration statement filed under the Act with the Commission, would constitute an “issuer free writing prospectus”, as defined in Rule 433 under the Act (any such offer is hereinafter referred to as a “
Company Supplemental Disclosure Document
”) and (y) have not solicited and will not solicit offers for, and have not offered or sold and will not offer or sell, the Securities by means of any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D other than any such solicitation listed on Schedule II(d) (each such solicitation, a “
Permitted General Solicitation
”; each written general solicitation document listed on Schedule II(d), a “
Permitted General Solicitation Material
”);
|
(ii)
|
each Purchaser, severally and not jointly, represents and agrees that, without the prior consent of the Company and the Representative, other than one or more term sheets relating to the Securities containing customary information and conveyed to purchasers of securities or any Permitted General Solicitation Material, it has not made and will not make any offer relating to the Securities that, if the offering of the Securities contemplated by this Agreement were conducted as a public offering pursuant to a registration statement filed under the Act with the Commission, would constitute a “free writing prospectus”, as defined in Rule 405 under the Act (any such offer (other than any such term sheets and any Permitted General Solicitation Material), is hereinafter referred to as a “
Purchaser Supplemental Disclosure Document
”); and
|
(iii)
|
any Company Supplemental Disclosure Document, Purchaser Supplemental Disclosure Document or Permitted General Solicitation Material, the use of which has been consented to by the Company and the Representative, is listed as applicable on Schedule II(b), Schedule II(c) or Schedule II(d) hereto, respectively.
|
7.
|
The Company covenants and agrees with the several Purchasers that the Company will pay or cause to be paid the following: (i) the fees, disbursements and expenses of the Company’s counsel and accountants in connection with the issue of the Securities and the Underlying Shares and all other expenses in connection with the preparation, printing, reproduction and filing of the Preliminary Offering Memorandum and the Offering Memorandum and any amendments and supplements thereto and the mailing and delivering of copies thereof to the Purchasers and dealers; (ii) the cost of printing or producing any Agreement among Purchasers, this Agreement, the Indenture, the Securities, the Blue Sky Memorandum, closing documents (including any compilations thereof), Permitted General Solicitation Materials and any other documents in connection with the offering, purchase, sale and delivery of the Securities; (iii) all expenses in connection with the qualification of the Securities and the Underlying Shares for offering and sale under state securities laws as provided in Section 5(b) hereof, including the fees and disbursements of one counsel for the Purchasers in each jurisdiction in connection with such qualification and in connection with the Blue Sky and legal investment surveys (such fees not to exceed $10,000); (iv) any fees charged by securities rating services for rating the Securities; (v) the cost of preparing the Securities; (vi) the fees and expenses of the Trustee and any agent of the Trustee and the fees and disbursements of counsel for the Trustee in connection with the Indenture and the Securities; (vii) all costs and expenses incurred in connection with any “road show” presentation to potential purchasers of the Securities; (viii) any cost incurred in connection with the listing of the Conversion Shares; (ix) any other costs and expenses related to the transfer and delivery of the Securities to the Purchasers, including any transfer taxes or other taxes payable thereon, and (x) all other costs and expenses incident to the performance of its obligations hereunder which are not otherwise specifically provided for in this Section. It is understood, however, that, except as provided in this Section, and Sections 9 and 12 hereof, the Purchasers will pay all of their own costs and expenses, including the fees of their counsel, transfer taxes on resale of any of the Securities by them, and any advertising expenses connected with any offers they may make.
|
8.
|
The obligations of the Purchasers hereunder shall be subject, in their discretion, to the condition that all representations and warranties and other statements of the Company herein are, at and as of each Time of Delivery, true and correct, the condition that the Company shall have performed all of its obligations hereunder theretofore to be performed, and the following additional conditions:
|
(a)
|
Cleary Gottlieb Steen & Hamilton LLP, counsel for the Purchasers, shall have furnished to you such opinion or opinions, dated such Time of Delivery, with respect to such matters as you may reasonably request, and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such matters;
|
(b)
|
DLA Piper LLP (US), counsel for the Company, shall have furnished to you their written opinion and negative assurance letters, each dated such Time of Delivery, in form and substance agreed to by the parties prior to the date hereof;
|
(c)
|
On the date of the Offering Memorandum prior to the execution of this Agreement and also at each Time of Delivery, as the case may be, PricewaterhouseCoopers LLP shall have furnished to the Representative, letters, dated the respective dates of delivery thereof and addressed to the Purchasers, in form and substance reasonably satisfactory to the Representative, containing statements and information of the type customarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained or incorporated by reference in the Pricing Memorandum and the Offering Memorandum;
provided
, that the letter to be delivered by PricewaterhouseCoopers LLP at each Time of Delivery shall use a “cut-off” date no more than three business days prior to such Time of Delivery;
|
(d)
|
(i) Neither the Company nor any of its subsidiaries shall have sustained since the date of the latest audited financial statements included or incorporated by reference in the Pricing Memorandum any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Pricing Memorandum, and (ii) since the respective dates as of which information is given in the Pricing Memorandum there shall not have been any change in the capital stock (other than pursuant to the Company’s equity incentive plans and inducement awards) or long-term debt of the Company or any of its subsidiaries or any change, or any development involving a prospective change, in or affecting the general affairs, management, financial position, stockholders’ equity or results of operations of the Company and its subsidiaries, otherwise than as set forth or contemplated in the Pricing Memorandum, the effect of which, in any such case described in clause (i) or (ii), is in your judgment so material and adverse as to make it impracticable or inadvisable to proceed with the offering or the delivery of the Securities being offered at such Time of Delivery on the terms and in the manner contemplated in this Agreement and in each of the Pricing Disclosure Package and the Offering Memorandum;
|
(e)
|
On or after the Applicable Time (i) no downgrading shall have occurred in the rating accorded the Company’s debt securities by any “nationally recognized statistical rating organization”, as such term is defined in Section 3(a)(62) of the Exchange Act, and (ii) no such organization shall have publicly announced that it has under surveillance or review, with possible negative implications, its rating of any of the Company’s debt securities;
|
(f)
|
On or after the Applicable Time there shall not have occurred any of the following: (i) a suspension or material limitation in trading in securities generally on the Exchange or on The NASDAQ Global Market; (ii) a suspension or material limitation in trading in the Company’s securities on the Exchange; (iii) a general moratorium on commercial banking activities declared by either Federal, New York State or California State authorities or a material disruption in commercial banking or securities settlement or clearance services in the United States; (iv) the outbreak or escalation of hostilities involving the United States or the declaration by the United States of a national emergency or war or (v) the occurrence of any other calamity or crisis or any change in financial, political or economic conditions in the United States or elsewhere, if the effect of any such event specified in clause (iv) or (v) in your judgment makes it impracticable or inadvisable to proceed with the offering or the delivery of the Securities being issued at each such Time of Delivery on the terms and in the manner contemplated in the Pricing Disclosure Package and the Offering Memorandum;
|
(g)
|
The Conversion Shares shall have been duly listed, subject to notice of issuance, on the Exchange;
|
(h)
|
The Company shall have obtained and delivered to the Purchasers executed copies of a lock-up agreement in the form attached hereto as Exhibit A from each of the parties listed on Schedule I thereto;
|
(i)
|
The Purchasers shall have received an executed original copy of the Indenture;
|
(j)
|
The Securities shall be eligible for clearance and settlement through the facilities of DTC;
|
(k)
|
The Company shall have furnished or caused to be furnished to you at such Time of Delivery certificates of officers of the Company satisfactory to you as to the accuracy of the representations and warranties of the Company herein at and as of such Time of Delivery, as to the performance by the Company of all of its obligations hereunder to be performed at or prior to such Time of Delivery, as to the matters set forth in subsection (e) of this Section and as to such other matters as you may reasonably request. The officer(s) signing and furnishing such certificate(s) may rely on his or her knowledge as to proceedings threatened; and
|
(l)
|
The Purchasers shall have received, on the date hereof, a certificate dated the date hereof from the Chief Financial Officer of the Company in form and substance agreed to by the parties prior to the date hereof.
|
9.
|
|
(a)
|
The Company will indemnify and hold harmless each Purchaser against any losses, claims, damages or liabilities, joint or several, to which such Purchaser may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Offering Memorandum, the Pricing Memorandum, the Pricing Disclosure Package, the Offering Memorandum, or any amendment or supplement thereto, any Company Supplemental Disclosure Document, any Permitted General Solicitation Material or arise out of or are based upon the omission or alleged omission to state therein a material fact necessary to make the statements therein not misleading, and will reimburse each Purchaser for any legal or other expenses reasonably incurred by such Purchaser in connection with investigating or defending any such action or claim as such expenses are incurred;
provided
,
however
, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in any Preliminary Offering Memorandum, the Pricing Memorandum, the Pricing Disclosure Package, the Offering Memorandum or any such amendment or supplement, any Company Supplemental Disclosure Document or any Permitted General Solicitation Material, in reliance upon and in conformity with written information furnished to the Company by any Purchaser through the Representative expressly for use therein.
|
(b)
|
Each Purchaser, severally and not jointly, will indemnify and hold harmless the Company against any losses, claims, damages or liabilities to which the Company may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Offering Memorandum, the Pricing Memorandum, the Pricing Disclosure Package, the Offering Memorandum, or any amendment or supplement thereto, or any Company Supplemental Disclosure Document, any Permitted General Solicitation Material or arise out of or are based upon the omission or alleged omission to state therein a material fact or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in any Preliminary Offering Memorandum, the Pricing Memorandum, the Pricing Disclosure Package, the Offering Memorandum or any such amendment or supplement, any Company Supplemental Disclosure Document or any Permitted General Solicitation Material, in reliance upon and in conformity with written information furnished to the Company by such Purchaser through the Representative expressly for use therein; and each Purchaser will reimburse the Company for any legal or other expenses reasonably incurred by the Company in connection with investigating or defending any such action or claim as such expenses are incurred.
|
(c)
|
Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the commencement thereof;
provided
that the failure so to notify the indemnifying party shall not relieve it from any liability that it may have to any indemnified party under subsection (a) or (b) above except to the extent that the indemnifying party has been materially prejudiced through the forfeiture of substantive rights or defenses by such failure; and
provided
,
further
, that the failure so to notify the indemnifying party shall not relieve it from any liability that it may have to any indemnified party otherwise than under subsection (a) or (b) above. In case any such action shall be brought against any indemnified party and it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and, after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party under such subsection for any legal expenses of other counsel or any other expenses, in each case subsequently incurred by such indemnified party, in connection with the defense thereof other than reasonable costs of investigation. No indemnifying party shall, without the written consent of the indemnified party, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified party is an actual or potential party to such action or claim) unless such settlement, compromise or judgment (i) includes an unconditional release of the indemnified party from all liability arising out of such action or claim and (ii) does not include a statement as to, or an admission of, fault, culpability or a failure to act, by or on behalf of any indemnified party.
|
(d)
|
If the indemnification provided for in this Section 9 is unavailable to or insufficient to hold harmless an indemnified party under subsection (a) or (b) above in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Purchasers on the other from the offering of the Securities. If, however, the allocation provided by the immediately preceding sentence is not permitted by applicable law or if the indemnified party failed to give the notice required under subsection (c) above, then each indemnifying party shall contribute to such amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company on the one hand and the Purchasers on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Purchasers on the other shall be deemed to be in the same proportion as the total net proceeds from the offering (before deducting expenses) received by the Company bear to the total discounts and commissions received by the Purchasers, in each case as set forth in the Offering Memorandum. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company on the one hand or the Purchasers on the other and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the Purchasers agree that it would not be just and equitable if contribution pursuant to this subsection (d) were determined by pro rata allocation (even if the Purchasers were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this subsection (d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this subsection (d), no Purchaser shall be required to contribute any amount in excess of the amount by which the total price at which the Securities purchased by it pursuant to this Agreement and distributed to investors were offered to investors exceeds the amount of any damages which such Purchaser has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. The Purchasers’ obligations in this subsection (d) to contribute are several in proportion to their respective purchase obligations and not joint.
|
(e)
|
The obligations of the Company under this Section 9 shall be in addition to any liability which the Company may otherwise have and shall extend, upon the same terms and conditions, to each employee, officer and director of each Purchaser, any affiliate of each Purchaser and each person, if any, who controls any Purchaser within the meaning of the Act; and the obligations of the Purchasers under this Section 9 shall be in addition to any liability which the respective Purchasers may otherwise have and shall extend, upon the same terms and conditions, to each officer and director of the Company and to each person, if any, who controls the Company within the meaning of the Act.
|
10.
|
|
(a)
|
If any Purchaser shall default in its obligation to purchase the Securities which it has agreed to purchase hereunder, the Representative may in its discretion arrange for it or another party or other parties to purchase such Securities on the terms contained herein at the applicable Time of Delivery. If within thirty-six hours after such default by any Purchaser the Representative does not arrange for the purchase of such Securities, then the Company shall be entitled to a further period of thirty-six hours within which to procure another party or other parties reasonably satisfactory to the Representative to purchase such Securities on such terms. In the event that, within the respective prescribed periods, the Representative notifies the Company that it has so arranged for the purchase of such Securities, or the Company notifies the Representative that it has so arranged for the purchase of such Securities, the Representative or the Company shall have the right to postpone such Time of Delivery for a period of not more than seven days, in order to effect whatever changes may thereby be made necessary in the Offering Memorandum, or in any other documents or arrangements, and the Company agrees to prepare promptly any amendments or supplements to the Offering Memorandum which in the opinion of the Representative may thereby be made necessary. The term “Purchaser” as used in this Agreement shall include any person substituted under this Section with like effect as if such person had originally been a party to this Agreement with respect to such Securities.
|
(b)
|
If, after giving effect to any arrangements for the purchase of the Securities of a defaulting Purchaser or Purchasers by the Representative and the Company as provided in subsection (a) above, the aggregate principal amount of such Securities which remains unpurchased does not exceed one-eleventh of the aggregate principal amount of all the Securities to be purchased at such Time of Delivery, then the Company shall have the right to require each non-defaulting Purchaser to purchase the principal amount of Securities which such Purchaser agreed to purchase hereunder at such Time of Delivery and, in addition, to require each non-defaulting Purchaser to purchase its pro rata share (based on the principal amount of Securities which such Purchaser agreed to purchase hereunder) of the Securities of such defaulting Purchaser or Purchasers for which such arrangements have not been made; but nothing herein shall relieve a defaulting Purchaser from liability for its default.
|
(c)
|
If, after giving effect to any arrangements for the purchase of the Securities of a defaulting Purchaser or Purchasers by the Representative and the Company as provided in subsection (a) above, the aggregate principal amount of Securities which remains unpurchased exceeds one- eleventh of the aggregate principal amount of all the Securities to be purchased at such Time of Delivery, or if the Company shall not exercise the right described in subsection (b) above to require non-defaulting Purchasers to purchase Securities of a defaulting Purchaser or Purchasers, then this Agreement (or, with respect to a Subsequent Time of Delivery, the obligation of the Purchasers to purchase and the Company to sell the Option Securities) shall thereupon terminate, without liability on the part of any non-defaulting Purchaser or the Company, except for the expenses to be borne by the Company and the Purchasers as provided in Section 6 hereof and the indemnity and contribution agreements in Section 9 hereof; but nothing herein shall relieve a defaulting Purchaser from liability for its default.
|
11.
|
The respective indemnities, agreements, representations, warranties and other statements of the Company and the several Purchasers, as set forth in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall remain in full force and effect, regardless of any investigation (or any statement as to the results thereof) made by or on behalf of any Purchaser or any controlling person of any Purchaser, or the Company, or any officer or director or controlling person of the Company, and shall survive delivery of and payment for the Securities.
|
12.
|
If this Agreement shall be terminated pursuant to Section 10 hereof, the Company shall not then be under any liability to any Purchaser except as provided in Sections 7 and 9 hereof; but, if for any other reason, the Securities are not delivered by or on behalf of the Company as provided herein, the Company will reimburse the Purchasers through you for all expenses approved in writing by the Representative, including fees and disbursements of counsel, reasonably incurred by the Purchasers in making preparations for the purchase, sale and delivery of the Securities, but the Company shall then be under no further liability to any Purchaser except as provided in Sections 7 and 9 hereof.
|
13.
|
In all dealings hereunder, the Representative shall act on behalf of each of the Purchasers, and the parties hereto shall be entitled to act and rely upon any statement, request, notice or agreement on behalf of any Purchaser made or given by the Representative.
|
14.
|
This Agreement shall be binding upon, and inure solely to the benefit of, the Purchasers, the Company and, to the extent provided in Sections 9 and 11 hereof, the officers and directors of the Company and each person who controls the Company or any Purchaser, and their respective heirs, executors, administrators, successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement. No purchaser of any of the Securities from any Purchaser shall be deemed a successor or assign by reason merely of such purchase.
|
15.
|
Time shall be of the essence of this Agreement.
|
16.
|
The Company acknowledges and agrees that (i) the purchase and sale of the Securities pursuant to this Agreement is an arm’s-length commercial transaction between the Company, on the one hand, and the several Purchasers, on the other, (ii) in connection therewith and with the process leading to such transaction each Purchaser is acting solely as a principal and not the agent or fiduciary of the Company, (iii) no Purchaser has assumed an advisory or fiduciary responsibility in favor of the Company with respect to the offering contemplated hereby or the process leading thereto (irrespective of whether such Purchaser has advised or is currently advising the Company on other matters) or any other obligation to the Company except the obligations expressly set forth in this Agreement and (iv) the Company has consulted its own legal and financial advisors to the extent it deemed appropriate. The Company agrees that it will not claim that the Purchasers, or any of them, has rendered advisory services of any nature or respect, or owes a fiduciary or similar duty to the Company, in connection with such transaction or the process leading thereto.
|
17.
|
This Agreement supersedes all prior agreements and understandings (whether written or oral) between the Company and the Purchasers, or any of them, with respect to the subject matter hereof.
|
18.
|
THIS AGREEMENT AND ANY MATTERS RELATED TO THIS TRANSACTION SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS THAT WOULD RESULT IN THE APPLICATION OF ANY LAW OTHER THAN THE LAWS OF THE STATE OF NEW YORK. The Company agrees that any suit or proceeding arising in respect of this agreement or our engagement will be tried exclusively in the U.S. District Court for the Southern District of New York or, if that court does not have subject matter jurisdiction, in any state court located in The City and County of New York and the Company agrees to submit to the jurisdiction of, and to venue in, such courts.
|
19.
|
The Company and each Purchaser 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.
|
20.
|
This Agreement may be executed by any one or more of the parties hereto in any number of counterparts, each of which shall be deemed to be an original, but all such respective counterparts shall together constitute one and the same instrument.
|
21.
|
Notwithstanding anything herein to the contrary, the Company (and the Company’s employees, representatives, and other agents) are authorized to disclose to any and all persons, the tax treatment and tax structure of the potential transaction and all materials of any kind (including tax opinions and other tax analyses) provided to the Company relating to that treatment and structure, without the Purchasers’ imposing any limitation of any kind. However, any information relating to the tax treatment and tax structure shall remain confidential (and the foregoing sentence shall not apply) to the extent necessary to enable any person to comply with securities laws. For this purpose, “tax treatment” means US federal and state income tax treatment, and “tax structure” is limited to any facts that may be relevant to that treatment.
|
22.
|
Recognition of the U.S. Special Resolution Regimes.
|
(a)
|
In the event that any Purchaser that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Purchaser of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.
|
(b)
|
In the event that any Purchaser that is a Covered Entity or a BHC Act Affiliate of such Purchaser becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Purchaser are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.
|
(c)
|
As used in this section:
|
To:
|
PROS Holdings, Inc.
3100 Main Street, Suite 900
Houston, Texas 77002
|
From:
|
[Dealer]
|
Re:
|
[Base][Additional] Capped Call Transaction
|
Ref. No:
|
[__________] If applicable
|
Date:
|
[], 2019
|
General Terms:
|
|
Trade Date:
|
[]
|
Effective Date:
|
[], or such other date as agreed by the parties in writing.
|
Components:
|
The Transaction will be divided into individual Components, each with the terms set forth in this Confirmation, and, in particular, with the Number of Options and Expiration Date set forth in Annex A to this Confirmation. The exercise, valuation and settlement of the Transaction will be effected separately for each Component as if each Component were a separate Transaction under the Agreement.
|
Option Style:
|
“European”, as described under “Procedures for Exercise” below.
|
Option Type:
|
Call
|
Seller:
|
Dealer
|
Buyer:
|
Counterparty
|
Shares:
|
Common Stock of Counterparty, par value USD$0.001 (Ticker Symbol: “PRO”).
|
Number of Options:
|
For each Component, as provided in Annex A to this Confirmation. For the base capped call, the total (allocated across each participating Dealer) should be equal to (i) the number of Convertible Securities in principal amount of $1,000 initially issued on the closing date for the Convertible Securities (excluding any Convertible Securities sold pursuant to the over-allotment option)
multiplied by
(ii) the initial conversion rate. For the additional capped call, the total should be equal to (i) the number of additional Convertible Securities in principal amount of $1,000
multiplied by
(ii) the initial conversion rate.
|
Option Entitlement:
|
One Share Per Option
|
Strike Price:
|
USD [_____]
|
Cap Price:
|
USD [_____];
provided
that in no event shall the Cap Price be reduced to an amount less than the Strike Price in connection with any adjustment by the Calculation Agent under this Confirmation.
|
Number of Shares:
|
As of any date, a number of Shares equal to the product of (i) the Number of Options and (ii) the Option Entitlement.
|
Premium:
|
USD [_____] (Premium per Option approximately USD [_____]); Dealer and Counterparty hereby agree that notwithstanding anything to the contrary herein or in the Agreement, following the payment of the Premium, no Early Termination Amount or amount determined pursuant to Sections 12.2, 12.3, 12.6, 12.7, 12.8 or 12.9 of the Equity Definitions, or otherwise under the Equity Definitions, shall be payable by Counterparty to Dealer.
|
Premium Payment Date:
|
The Effective Date
|
Exchange:
|
The New York Stock Exchange
|
Related Exchange:
|
All Exchanges; provided that Section 1.26 of the Equity Definitions shall be amended to add the words “United States” before the word “exchange” in the tenth line of such Section.
|
Procedures for Exercise:
|
|
Expiration Time:
|
The Valuation Time
|
Settlement Method Election:
|
Applicable;
provided
that (a) Section 7.1 of the Equity Definitions is hereby amended by replacing the term “Physical Settlement” with the term “Net Share Settlement”, (b) Counterparty must make a single irrevocable election for all Components and (c) if Counterparty is electing Cash Settlement, such Settlement Method Election would be effective only if Counterparty represents and warrants to Dealer in writing on the date of such Settlement Method Election that (i) Counterparty is not in possession of any material non-public information regarding Counterparty or the Shares, and (ii) such election is being made in good faith and not as part of a plan or scheme to evade compliance with the federal securities laws.
Without limiting the generality of the foregoing, Counterparty acknowledges its responsibilities under applicable securities laws, and in particular Sections 9 and 10(b) of the Exchange Act and the rules and regulations promulgated thereunder in respect of such election.
|
Electing Party:
|
Counterparty
|
Settlement Method Election Date:
|
The second Scheduled Valid Day prior to the scheduled Expiration Date for the Component with the earliest scheduled Expiration Date.
|
Default Settlement Method:
|
Net Share Settlement
|
Net Share Settlement:
|
With respect to any Component, if Net Share Settlement is applicable to the Options exercised or deemed exercised hereunder, Dealer will deliver to Counterparty, on the relevant Settlement Date for such Component, a number of Shares (the “
Net Share Settlement Amount
”) equal to (i) the Daily Option Value on the Expiration Date of such Component
divided by
(ii) the Relevant Price on such Expiration Date.
Dealer will deliver cash in lieu of any fractional Shares to be delivered with respect to any Net Share Settlement Amount valued at the Relevant Price for the Expiration Date of such Component.
|
Cash Settlement:
|
With respect to any Component, if Cash Settlement is applicable to the Options exercised or deemed exercised hereunder, in lieu of Section 8.1 of the Equity Definitions, Dealer will pay to Counterparty, on the relevant Settlement Date for each such Option, an amount of cash (the “
Cash Settlement Amount
”) equal to the Daily Option Value on the Expiration Date of such Component.
|
Delivery Obligation:
|
For any Settlement Date, the Net Share Settlement Amount or the Cash Settlement Amount payable or deliverable on such Settlement Date.
|
Daily Option Value:
|
For any Component, an amount equal to (i) the Number of Options in such Component,
multiplied by
(ii) the Option Entitlement
multiplied by
(iii) (A) the lesser of the Relevant Price on the Expiration Date of such Component and the Cap Price, minus (B) the Strike Price on such Expiration Date;
provided
that if the calculation above results in a negative number, the Daily Option Value for such Component shall be deemed to be zero. In no event will the Daily Option Value be less than zero.
|
Valid Day:
|
A day on which (i) there is no Market Disruption Event and (ii) trading in the Shares generally occurs on the Exchange. If the Shares are not listed, quoted or traded on any U.S. securities exchange or any other market, “
Valid Day
” means a Business Day.
|
Scheduled Valid Day:
|
A day that is scheduled to be a Valid Day on the Exchange. If the Shares are not listed, quoted or traded on any U.S. securities exchange or any other market, “
Scheduled Valid Day
” means a Business Day.
|
Business Day:
|
Any day other than a Saturday, a Sunday or other day on which banking institutions are authorized or required by law, regulation or executive order to close or be closed in the State of New York.
|
Relevant Price:
|
On any Valid Day, the per Share volume-weighted average price as displayed under the heading “Bloomberg VWAP” on Bloomberg page “PRO <equity> AQR” (or its equivalent successor if such page is not available) (the “
VWAP
”) in respect of the period from the scheduled open of trading until the scheduled close of trading of the primary trading session on the Exchange on such Valid Day (or if such volume-weighted average price is unavailable at such time, the market value of one Share on such Valid Day, as determined by the Calculation Agent in a good faith and commercially reasonable manner using, if practicable, a volume-weighted average method substantially similar to the method for determining the VWAP). The Relevant Price will be determined without regard to after-hours trading or any other trading outside of the regular trading session trading hours.
|
Settlement Date:
|
For all Components of the Transaction, the date one Settlement Cycle immediately following the Expiration Date for the Component with the latest scheduled Expiration Date.
|
Settlement Currency:
|
USD
|
Other Applicable Provisions:
|
To the extent Dealer is obligated to deliver Shares hereunder, the provisions of Sections 9.1(c), 9.8, 9.9, 9.11 and 9.12 of the Equity Definitions will be applicable, except that all references in such provisions to “Physically-settled” shall be read as references to “Net Share Settlement.”
|
Representation and Agreement:
|
Notwithstanding anything to the contrary in Equity Definitions (including, but not limited to, Section 9.11 thereof), the parties acknowledge that (i) any Shares delivered to Counterparty shall be, upon delivery, subject to restrictions and limitations arising from Counterparty’s status as issuer of the Shares under applicable securities laws, (ii) Dealer may deliver any Shares required to be delivered hereunder in certificated form in lieu of delivery through the Clearance System and (iii) any Shares delivered to Counterparty may be “restricted securities” (as defined in Rule 144 under the Securities Act of 1933, as amended (the “
Securities Act
”)).
|
Adjustments:
|
|
Method of Adjustment:
|
Calculation Agent Adjustment;
provided that
the parties agree that (x) open market Share repurchases at prevailing market price and (y) Share repurchases through a dealer pursuant to accelerated share repurchases, forward contracts or similar transactions (including without limitation any discount to average VWAP prices) that are entered into at prevailing market prices and in accordance with customary market terms for transactions of such type to repurchase the Shares shall not be considered Potential Adjustment Events.
|
Extraordinary Events:
|
|
New Shares:
|
In the definition of New Shares in Section 12.1(i) of the Equity Definitions, the text in clause (i) thereof shall be deleted in its entirety and replaced with “publicly quoted, traded or listed on any of The New York Stock Exchange, The NASDAQ Global Market or The NASDAQ Global Select Market (or their respective successors) and of an entity or person organized under the laws of the United States, any State thereof or the District of Columbia”.
|
Merger Events:
|
Applicable
|
Consequences of Merger Events:
|
|
(a) Share-for-Share:
|
Modified Calculation Agent Adjustment
|
(b) Share-for-Other:
|
Cancellation and Payment (Calculation Agent Determination)
|
(c) Share-for-Combined:
|
Component Adjustment; provided that the Calculation Agent may elect Cancellation and Payment for all or part of the Transaction if Component Adjustment would not produce a commercially reasonable result.
|
Tender Offer:
|
Applicable;
provided
that the definition of “Tender Offer” in Section 12.1 of the Equity Definitions will be amended by replacing the phrase “greater than 10% and less than 100% of the outstanding voting shares of the Counterparty” in the third and fourth line thereof with “greater than 20% and less than 100% of the outstanding Shares of the Counterparty”.
|
Consequences of Tender Offers:
|
|
(a) Share-for-Share:
|
Modified Calculation Agent Adjustment
|
(b) Share-for-Other:
|
Modified Calculation Agent Adjustment
|
(c) Share-for-Combined:
|
Modified Calculation Agent Adjustment
|
Consequences of Announcement Events:
|
Upon an Announcement Event (as defined below), the Calculation Agent shall make a Modified Calculation Agent Adjustment as set forth in Section 12.3(d) of the Equity Definitions; provided that, in respect of an Announcement Event, (x) references to “Tender Offer” shall be replaced by references to “Announcement Event” and references to “Tender Offer Date” shall be replaced by references to “date of such Announcement Event” and (y) the phrase “exercise, settlement, payment or any other terms of the Transaction including, without limitation, the spread)” shall be replaced with the phrase “exercise, settlement, payment or any other terms of the Transaction; provided that if an adjustment to the Cap Price would produce a commercially reasonable result, then such adjustment shall be limited to the Cap Price (provided that in no event shall the Cap Price be less than the Strike Price)”. An Announcement Event shall be an “Extraordinary Event” for purposes of the Equity Definitions, to which Article 12 of the Equity Definitions is applicable (it being understood and agreed that the Calculation Agent shall provide to Counterparty commercially reasonable documentary evidence of the inputs used to make such adjustments to the terms of the Transaction, subject to, and in accordance with, Section 3 hereof); provided that upon the Calculation Agent making an adjustment, determined in a commercially reasonable manner, to the terms of any Component upon any Announcement Event, then the Calculation Agent shall make an adjustment to the terms of such Component upon any announcement regarding the same event that gave rise to the original Announcement Event regarding the abandonment of any such event to the extent necessary to reflect the economic effect of such subsequent announcement on the Transaction.
|
Announcement Event:
|
(i) The public announcement (whether by Counterparty or a Valid Third Party Entity) of any Merger Event or Tender Offer, or the announcement by Counterparty of any intention to enter into a Merger Event or Tender Offer, (ii) the public announcement by Counterparty of an intention by Counterparty to solicit or enter into, or to explore strategic alternatives or other similar undertaking that may include, a Merger Event or Tender Offer, (iii) there occurs a public announcement (whether by Counterparty or a Valid Third Party Entity) of any potential acquisition by Counterparty and/or its subsidiaries where the consideration exceeds 35% of the market capitalization of the Counterparty as of the date of such announcement, or (iv) any subsequent public announcement (whether by Counterparty or a Valid Third Party Entity) of a change to a transaction or intention that is the subject of an announcement of the type described in clause (i), (ii) or (iii) of this sentence (including, without limitation, a new announcement relating to such a transaction or intention or the announcement of a withdrawal from, or the abandonment or discontinuation of, such a transaction or intention); provided that, for the avoidance of doubt, the occurrence of an Announcement Event with respect to any transaction or intention shall not preclude the occurrence of a later Announcement Event with respect to such transaction or intention; it being understood that any adjustment in respect of an Announcement Event shall take into account any earlier adjustment relating to the same Announcement Event and shall not be duplicative with any other adjustment, cancellation or valuation made pursuant to this Confirmation, the Equity Definitions or the Agreement.
|
Valid Third Party Entity:
|
In respect of any transaction, any third party that has a bona fide intent to enter into or consummate such transaction (it being understood and agreed that in determining whether such third party has such a bona fide intent, the Calculation Agent may take into consideration the effect of the relevant announcement by such third party on the Shares and/or options relating to the Shares).
|
To:
|
PROS Holdings, Inc.
|
Share Termination Alternative:
|
If applicable, Dealer shall deliver to Counterparty the Share Termination Delivery Property on, or within a commercially reasonable period of time after, the date when the relevant Payment Obligation would otherwise be due pursuant to Section 12.7 or 12.9 of the Equity Definitions or Section 6(d)(ii) and 6(e) of the Agreement, as applicable, in satisfaction of such Payment Obligation in the manner reasonably requested by Counterparty free of payment.
|
Share Termination Delivery Property:
|
A number of Share Termination Delivery Units, as calculated by the Calculation Agent, equal to the Payment Obligation divided by the Share Termination Unit Price. The Calculation Agent shall adjust the Share Termination Delivery Property by replacing any fractional portion of a security therein with an amount of cash equal to the value of such fractional security based on the values used to calculate the Share Termination Unit Price.
|
Share Termination Unit Price:
|
The value of property contained in one Share Termination Delivery Unit, as determined by the Calculation Agent in its discretion by commercially reasonable means and notified by the Calculation Agent to Dealer at the time of notification of the Payment Obligation. For the avoidance of doubt, the parties agree that in determining the Share Termination Delivery Unit Price the Calculation Agent may consider a variety of factors, including the market price of the Share Termination Delivery Units and/or the purchase price paid in connection with the commercially reasonable purchase of Share Termination Delivery Property.
|
Share Termination Delivery Unit:
|
One Share or, if the Shares have changed into cash or any other property or the right to receive cash or any other property as the result of a Nationalization, Insolvency or Merger Event (any such cash or other property, the “
Exchange Property
”), a unit consisting of the type and amount of such Exchange Property received by a holder of one Share (without consideration of any requirement to pay cash or other consideration in lieu of fractional amounts of any securities) in such Nationalization, Insolvency or Merger Event, as determined by the Calculation Agent.
|
Failure to Deliver:
|
Applicable
|
Other Applicable Provisions:
|
If Share Termination Alternative is applicable, the provisions of Sections 9.8, 9.9, 9.11 and 9.12 (as modified above) of the Equity Definitions and the provisions set forth opposite the caption “Representation and Agreement” in Section 2 will be applicable, except that all references in such provisions to “Physically-settled” shall be read as references to “Share Termination Settled” and all references to “Shares” shall be read as references to “Share Termination Delivery Units”. “Share Termination Settled” in relation to the Transaction means that the Share Termination Alternative is applicable to the Transaction.
|
(A)
|
With respect to any Transfer Options, Counterparty shall not be released from its notice and indemnification obligations pursuant to Section ý8(e) or any obligations under (x) Section 8(d) of this Confirmation or (y) in respect of any Extraordinary Event occurring prior to such transfer;
|
(B)
|
Any Transfer Options shall only be transferred or assigned to a third party that is a United States person (as defined in the Internal Revenue Code of 1986, as amended);
|
(C)
|
Such transfer or assignment shall be effected on terms, including any reasonable undertakings by such third party (including, but not limited to, an undertaking with respect to compliance with applicable securities laws in a manner that, in the reasonable judgment of Dealer, will not expose Dealer to material risks under applicable securities laws) and execution of any documentation and delivery of legal opinions with respect to securities laws and other matters by such third party and Counterparty, as are requested and reasonably satisfactory to Dealer;
|
(D)
|
Dealer will not, as a result of such transfer and assignment, be required to pay the transferee on any payment date an amount under Section 2(d)(i)(4) of the Agreement greater than an amount that Dealer would have been required to pay to Counterparty in the absence of such transfer and assignment;
|
(E)
|
An Event of Default, Potential Event of Default or Termination Event will not occur as a result of such transfer and assignment;
|
(F)
|
Without limiting the generality of clause ý(B), Counterparty shall cause the transferee to make such Payee Tax Representations and to provide such tax documentation as may be reasonably requested by Dealer to permit Dealer to determine that results described in clauses ý(D) and ý(E) will not occur upon or after such transfer and assignment; and
|
(G)
|
Counterparty shall be responsible for all reasonable costs and expenses, including reasonable counsel fees, incurred by Dealer in connection with such transfer or assignment.
|
Trade Date:
|
May [__], 2019
|
Effective Date:
|
May [__], 2019, or such other date as agreed by the parties in writing.
|
Components:
|
The Transaction will be divided into individual Components, each with the terms set forth in this Confirmation, and, in particular, with the Number of Options and Expiration Date set forth in Annex A to this Confirmation. The exercise, valuation and settlement of the Transaction will be effected separately for each Component as if each Component were a separate Transaction under the Agreement.
|
Option Style:
|
“European”, as described under “Procedures for Exercise” below.
|
Option Type:
|
Call
|
Seller:
|
Dealer
|
Buyer:
|
Counterparty
|
Shares:
|
Common Stock of Counterparty, par value USD$0.001 (Ticker Symbol: “PRO”).
|
Number of Options:
|
For each Component, as provided in Annex A to this Confirmation.
|
Option Entitlement:
|
One Share Per Option
|
Strike Price:
|
USD [____]
|
Cap Price:
|
USD [_____];
provided
that in no event shall the Cap Price be reduced to an amount less than the Strike Price in connection with any adjustment by the Calculation Agent under this Confirmation.
|
Number of Shares:
|
As of any date, a number of Shares equal to the product of (i) the Number of Options and (ii) the Option Entitlement.
|
Premium:
|
USD [____] (Premium per Option approximately USD [___]); Dealer and Counterparty hereby agree that notwithstanding anything to the contrary herein or in the Agreement, following the payment of the Premium, no Early Termination Amount or amount determined pursuant to Sections 12.2, 12.3, 12.6, 12.7, 12.8 or 12.9 of the Equity Definitions, or otherwise under the Equity Definitions, shall be payable by Counterparty to Dealer.
|
Premium Payment Date:
|
The Effective Date
|
Exchange:
|
The New York Stock Exchange
|
Related Exchange:
|
All Exchanges; provided that Section 1.26 of the Equity Definitions shall be amended to add the words “United States” before the word “exchange” in the tenth line of such Section.
|
Expiration Time:
|
The Valuation Time
|
Expiration Date:
|
For any Component, as provided in
Annex A
to this Confirmation (or, if such date is not a Scheduled Valid Day, the next following Scheduled Valid Day that is not already an Expiration Date for another Component);
provided
that if that date is a Disrupted Day, the Expiration Date for such Component shall be the first succeeding Scheduled Valid Day that is not a Disrupted Day and is not or is not deemed to be an Expiration Date in respect of any other Component of the Transaction hereunder; and
provided further
that in no event shall the Expiration Date be postponed to a date later than the Final Termination Date and, notwithstanding anything to the contrary in this Confirmation or the Equity Definitions, if the Expiration Date is a Disrupted Day that occurs on the Final Termination Date, the Relevant Price for such Expiration Date shall be the prevailing market value per Share determined by the Calculation Agent in a good faith and commercially reasonable manner. Notwithstanding the foregoing and anything to the contrary in the Equity Definitions, if a Market Disruption Event occurs on any Expiration Date, the Calculation Agent may determine in a good faith and commercially reasonable manner that such Expiration Date is a Disrupted Day only in part, in which case the Calculation Agent shall make commercially reasonable adjustments to the Number of Options for the relevant Component for which such day shall be the Expiration Date, shall designate the Scheduled Valid Day determined in the manner described in the immediately preceding sentence as the Expiration Date for the remaining Options for such Component and may determine the Relevant Price based on transactions in the Shares on such Disrupted Day taking into account the nature and duration of such Market Disruption Event on such day. Any Scheduled Valid Day on which, as of the date hereof, the Exchange is scheduled to close prior to its normal close of trading shall be deemed not to be a Scheduled Valid Day; if a closure of the Exchange prior to its normal close of trading on any Scheduled Valid Day is scheduled following the date hereof, then such Scheduled Valid Day shall be deemed to be a Disrupted Day in full
.
Section 6.6 of the Equity Definitions shall not apply to any Valuation Date occurring on an Expiration Date.
|
Final Termination Date:
|
May [__], [___}
|
Automatic Exercise:
|
Applicable; and means that the Number of Options for the relevant Component will be deemed to be automatically exercised at the Expiration Time on the Expiration Date for such Component if at such time such Component is In-the-Money, unless Buyer notifies Seller (in writing) prior to the Expiration Time on such Expiration Date that it does not wish Automatic Exercise to occur with respect to such Component, in which case Automatic Exercise will not apply with respect to such Component. “
In-the-Money
” means, in respect of any Component, that the Relevant Price on the Expiration Date for such Component is greater than the Strike Price for such Component.
|
Valuation Time:
|
At the close of trading of the regular trading session on the Exchange;
provided
that if the principal trading session is extended, the Calculation Agent shall determine the Valuation Time in a good faith and commercially reasonable manner.
|
Valuation Date:
|
For any Component, the Expiration Date therefor.
|
Market Disruption Event:
|
Section 6.3(a) of the Equity Definitions is hereby amended by deleting the words “during the one hour period that ends at the relevant Valuation Time, Latest Exercise Time, Knock-in Valuation Time or Knock-out Valuation Time, as the case may be,” in clause (ii) thereof.
|
Settlement Method Election:
|
Applicable;
provided
that (a) Section 7.1 of the Equity Definitions is hereby amended by replacing the term “Physical Settlement” with the term “Net Share Settlement”, (b) Counterparty must make a single irrevocable election for all Components and (c) if Counterparty is electing Cash Settlement, such Settlement Method Election would be effective only if Counterparty represents and warrants to Dealer in writing on the date of such Settlement Method Election that (i) Counterparty is not in possession of any material non-public information regarding Counterparty or the Shares, and (ii) such election is being made in good faith and not as part of a plan or scheme to evade compliance with the federal securities laws.
|
Electing Party:
|
Counterparty
|
Settlement Method Election Date:
|
The second Scheduled Valid Day prior to the scheduled Expiration Date for the Component with the earliest scheduled Expiration Date.
|
Default Settlement Method:
|
Net Share Settlement
|
Net Share Settlement:
|
With respect to any Component, if Net Share Settlement is applicable to the Options exercised or deemed exercised hereunder, Dealer will deliver to Counterparty, on the relevant Settlement Date for such Component, a number of Shares (the “
Net Share Settlement Amount
”) equal to (i) the Daily Option Value on the Expiration Date of such Component
divided by
(ii) the Relevant Price on such Expiration Date.
|
Cash Settlement:
|
With respect to any Component, if Cash Settlement is applicable to the Options exercised or deemed exercised hereunder, in lieu of Section 8.1 of the Equity Definitions, Dealer will pay to Counterparty, on the relevant Settlement Date for each such Option, an amount of cash (the “
Cash Settlement Amount
”) equal to the Daily Option Value on the Expiration Date of such Component.
|
Delivery Obligation:
|
For any Settlement Date, the Net Share Settlement Amount or the Cash Settlement Amount payable or deliverable on such Settlement Date.
|
Daily Option Value:
|
For any Component, an amount equal to (i) the Number of Options in such Component,
multiplied by
(ii) the Option Entitlement
multiplied by
(iii) (A) the lesser of the Relevant Price on the Expiration Date of such Component and the Cap Price, minus (B) the Strike Price on such Expiration Date;
provided
that if the calculation above results in a negative number, the Daily Option Value for such Component shall be deemed to be zero. In no event will the Daily Option Value be less than zero.
|
Valid Day:
|
A day on which (i) there is no Market Disruption Event and (ii) trading in the Shares generally occurs on the Exchange. If the Shares are not listed, quoted or traded on any U.S. securities exchange or any other market, “
Valid Day
” means a Business Day.
|
Scheduled Valid Day:
|
A day that is scheduled to be a Valid Day on the Exchange. If the Shares are not listed, quoted or traded on any U.S. securities exchange or any other market, “
Scheduled Valid Day
” means a Business Day.
|
Business Day:
|
Any day other than a Saturday, a Sunday or other day on which banking institutions are authorized or required by law, regulation or executive order to close or be closed in the State of New York.
|
Relevant Price:
|
On any Valid Day, the per Share volume-weighted average price as displayed under the heading “Bloomberg VWAP” on Bloomberg page “PRO <equity> AQR” (or its equivalent successor if such page is not available) (the “
VWAP
”) in respect of the period from the scheduled open of trading until the scheduled close of trading of the primary trading session on the Exchange on such Valid Day (or if such volume-weighted average price is unavailable at such time, the market value of one Share on such Valid Day, as determined by the Calculation Agent in a good faith and commercially reasonable manner using, if practicable, a volume-weighted average method substantially similar to the method for determining the VWAP). The Relevant Price will be determined without regard to after-hours trading or any other trading outside of the regular trading session trading hours.
|
Settlement Date:
|
For all Components of the Transaction, the date one Settlement Cycle immediately following the Expiration Date for the Component with the latest scheduled Expiration Date.
|
Settlement Currency:
|
USD
|
Other Applicable Provisions:
|
To the extent Dealer is obligated to deliver Shares hereunder, the provisions of Sections 9.1(c), 9.8, 9.9, 9.11 and 9.12 of the Equity Definitions will be applicable, except that all references in such provisions to “Physically-settled” shall be read as references to “Net Share Settlement.”
|
Representation and Agreement:
|
Notwithstanding anything to the contrary in Equity Definitions (including, but not limited to, Section 9.11 thereof), the parties acknowledge that (i) any Shares delivered to Counterparty shall be, upon delivery, subject to restrictions and limitations arising from Counterparty’s status as issuer of the Shares under applicable securities laws, (ii) Dealer may deliver any Shares required to be delivered hereunder in certificated form in lieu of delivery through the Clearance System and (iii) any Shares delivered to Counterparty may be “restricted securities” (as defined in Rule 144 under the Securities Act of 1933, as amended (the “
Securities Act
”)).
|
Method of Adjustment:
|
Calculation Agent Adjustment;
provided that
the parties agree that (x) open market Share repurchases at prevailing market price and (y) Share repurchases through a dealer pursuant to accelerated share repurchases, forward contracts or similar transactions (including without limitation any discount to average VWAP prices) that are entered into at prevailing market prices and in accordance with customary market terms for transactions of such type to repurchase the Shares shall not be considered Potential Adjustment Events.
|
New Shares:
|
In the definition of New Shares in Section 12.1(i) of the Equity Definitions, the text in clause (i) thereof shall be deleted in its entirety and replaced with “publicly quoted, traded or listed on any of The New York Stock Exchange, The NASDAQ Global Market or The NASDAQ Global Select Market (or their respective successors) and of an entity or person organized under the laws of the United States, any State thereof or the District of Columbia”.
|
Merger Events:
|
Applicable
|
(a) Share-for-Share:
|
Modified Calculation Agent Adjustment
|
(b) Share-for-Other:
|
Cancellation and Payment (Calculation Agent Determination)
|
(c) Share-for-Combined:
|
Component Adjustment; provided that the Calculation Agent may elect Cancellation and Payment for all or part of the Transaction if Component Adjustment would not produce a commercially reasonable result.
|
Tender Offer:
|
Applicable;
provided
that the definition of “Tender Offer” in Section 12.1 of the Equity Definitions will be amended by replacing the phrase “greater than 10% and less than 100%
|
(a) Share-for-Share:
|
Modified Calculation Agent Adjustment
|
(b) Share-for-Other:
|
Modified Calculation Agent Adjustment
|
(c) Share-for-Combined
|
Modified Calculation Agent Adjustment
|
Announcement Events:
|
Upon an Announcement Event (as defined below), the Calculation Agent shall make a Modified Calculation Agent Adjustment as set forth in Section 12.3(d) of the Equity Definitions; provided that, in respect of an Announcement Event, (x) references to “Tender Offer” shall be replaced by references to “Announcement Event” and references to “Tender Offer Date” shall be replaced by references to “date of such Announcement Event” and (y) the phrase “exercise, settlement, payment or any other terms of the Transaction including, without limitation, the spread)” shall be replaced with the phrase “exercise, settlement, payment or any other terms of the Transaction; provided that if an adjustment to the Cap Price would produce a commercially reasonable result, then such adjustment shall be limited to the Cap Price (provided that in no event shall the Cap Price be less than the Strike Price)”. An Announcement Event shall be an “Extraordinary Event” for purposes of the Equity Definitions, to which Article 12 of the Equity Definitions is applicable (it being understood and agreed that the Calculation Agent shall provide to Counterparty commercially reasonable documentary evidence of the inputs used to make such adjustments to the terms of the Transaction, subject to, and in accordance with, Section 3 hereof); provided that upon the Calculation Agent making an adjustment, determined in a commercially reasonable manner, to the terms of any Component upon any Announcement Event, then the Calculation Agent shall make an adjustment to the terms of such Component upon any announcement regarding the same event that gave rise to the original Announcement Event regarding the abandonment of any such event to the extent necessary to reflect the economic effect of such subsequent announcement on the Transaction.
|
Announcement Event:
|
(i) The public announcement (whether by Counterparty or a Valid Third Party Entity) of any Merger Event or Tender Offer, or the announcement by Counterparty of any intention to enter into a Merger Event or Tender Offer, (ii) the public announcement by Counterparty of an intention by Counterparty to solicit or enter into, or to explore strategic alternatives or other similar undertaking that may include, a Merger Event or Tender Offer, (iii) there occurs a public announcement (whether by Counterparty or a Valid Third Party Entity) of any potential acquisition by Counterparty and/or its subsidiaries where the consideration exceeds 35% of the market capitalization of the Counterparty as of the date of such announcement, or (iv) any subsequent public announcement (whether by Counterparty or a Valid Third Party Entity) of a change to a transaction or intention that is the subject of an announcement of the type described in clause (i), (ii) or (iii) of this sentence (including, without limitation, a new announcement relating to such a transaction or intention or the announcement of a withdrawal from, or the abandonment or discontinuation of, such a transaction or intention); provided that, for the avoidance of doubt, the occurrence of an Announcement Event with respect to any transaction or intention shall not preclude the occurrence of a later Announcement Event with respect to such transaction or intention; it being understood that any adjustment in respect of an Announcement Event shall take into account any earlier adjustment relating to the same Announcement Event and shall not be duplicative with any other adjustment, cancellation or valuation made pursuant to this Confirmation, the Equity Definitions or the Agreement.
|
Valid Third Party Entity:
|
In respect of any transaction, any third party that has a bona fide intent to enter into or consummate such transaction (it being understood and agreed that in determining whether such third party has such a bona fide intent, the Calculation Agent may take into consideration the effect of the relevant announcement by such third party on the Shares and/or options relating to the Shares).
|
and Consequences:
|
Upon the occurrence of a Merger Event that causes the Shares to be converted into the right to receive more than a single type of consideration (determined based in part upon any form of stockholder election), Counterparty shall reasonably promptly (but in any event prior to the relevant merger date) notify the Calculation Agent of (i) the type and amount of consideration that a holder of Shares would have been entitled to in the case of reclassifications, consolidations, mergers, sales or transfers of assets or other transactions that cause Shares to be converted into the right to receive more than a single type of consideration and (ii) the weighted average of the types and amounts of consideration to be received by the holders of Shares that affirmatively make such an election.
|
or Delisting:
|
Cancellation and Payment (Calculation Agent Determination);
provided
that in addition to the provisions of Section 12.6(a)(iii) of the Equity Definitions, it will also constitute a Delisting if the Shares are not immediately re-listed, re-traded or re-quoted on any of the New York Stock Exchange, The NASDAQ Global Select Market or The NASDAQ Global Market (or their respective successors); if the Shares are immediately re-listed, re-traded or re-quoted on any such exchange or quotation system, such exchange or quotation system shall thereafter be deemed to be the Exchange.
|
(a) Change in Law:
|
Applicable;
provided
that Section 12.9(a)(ii) of the Equity Definitions is hereby amended by (i) replacing the phrase “the interpretation” in the third line thereof with the phrase “, or public announcement of, the formal or informal interpretation”, (ii) by adding the phrase “and/or Hedge Position” after the word “Shares” in clause (X) thereof and (iii) by immediately following the word “Transaction” in clause (X) thereof, adding the phrase “in the manner contemplated by the Hedging Party on the Trade Date”.
|
(b) Failure to Deliver:
|
Applicable
|
(c) Insolvency Filing:
|
Applicable
|
(d) Hedging Disruption:
|
Applicable
|
Hedging:
|
Not Applicable
|
Hedging Party:
|
Dealer
|
Determining Party:
|
For all applicable Extraordinary Events, Dealer; all calculations and determinations made by the Determining Party shall be made in good faith and in a commercially reasonable manner;
provided
that, upon receipt of written request from Counterparty, the Determining Party shall promptly provide Counterparty with a written explanation (including relevant data in a commonly used file format for the storage and manipulation of financial data) describing in reasonable detail any calculation, adjustment or determination made by it (including any quotations, market data or information from internal or external sources used in making such calculation, adjustment or determination, as the case may be, but without disclosing Determining Party’s proprietary models or other information that may be proprietary or subject to contractual, legal or regulatory obligations to not disclose such information), and shall use commercially reasonable efforts to provide such written explanation within five (5) Exchange Business Days from the receipt of such request.
|
Non-Reliance:
|
Applicable
|
Acknowledgments
|
Applicable
|
Hedging Adjustment:
|
For the avoidance of doubt, whenever the Dealer, Determining Party or Calculation Agent is required or permitted to make a calculation, adjustment, determination or election (for the avoidance of doubt, including but not limited to, any calculation or determinations with respect to any amounts, including amounts payable upon termination or early termination) pursuant to the terms of the Agreement, this Confirmation or the Equity Definitions to take into account the effect of an event or otherwise, the Calculation Agent or Determining Party or Dealer, as the case may be, shall make such calculation, determination, election or adjustment by reference to the effect of such event on Dealer assuming that Dealer maintains a commercially reasonable Hedge Position in respect of the Transaction.
|
Additional Acknowledgments:
|
Applicable
|
Share Termination Alternative:
|
If applicable, Dealer shall deliver to Counterparty the Share Termination Delivery Property on, or within a commercially reasonable period of time after, the date when the relevant Payment Obligation would otherwise be due pursuant to Section 12.7 or 12.9 of the Equity Definitions or Section 6(d)(ii) and 6(e) of the Agreement, as applicable, in satisfaction of such Payment Obligation in the manner reasonably requested by Counterparty free of payment.
|
Share Termination Delivery Property:
|
A number of Share Termination Delivery Units, as calculated by the Calculation Agent, equal to the Payment Obligation divided by the Share Termination Unit Price. The Calculation Agent shall adjust the Share Termination Delivery Property by replacing any fractional portion of a security therein with an amount of cash equal to the value of such fractional security based on the values used to calculate the Share Termination Unit Price.
|
Share Termination Unit Price:
|
The value of property contained in one Share Termination Delivery Unit, as determined by the Calculation Agent in its discretion by commercially reasonable means and notified by the Calculation Agent to Dealer at the time of notification of the Payment Obligation. For the avoidance of doubt, the parties agree that in determining the Share Termination Delivery Unit Price the Calculation Agent may consider a variety of factors, including the market price of the Share Termination Delivery Units and/or the purchase price paid in connection with the commercially reasonable purchase of Share Termination Delivery Property.
|
Share Termination Delivery Unit:
|
One Share or, if the Shares have changed into cash or any other property or the right to receive cash or any other property as the result of a Nationalization, Insolvency or Merger Event (any such cash or other property, the “
Exchange Property
”), a unit consisting of the type and amount of such Exchange Property received by a holder of one Share (without consideration of any requirement to pay cash or other consideration in lieu of fractional amounts of any securities) in such Nationalization, Insolvency or Merger Event, as determined by the Calculation Agent.
|
Other Applicable Provisions:
|
If Share Termination Alternative is applicable, the provisions of Sections 9.8, 9.9, 9.11 and 9.12 (as modified above) of the Equity Definitions and the provisions set forth opposite the caption “Representation and Agreement” in Section 2 will be applicable, except that all references in such provisions to “Physically-settled” shall be read as references to “Share Termination Settled” and all references to “Shares” shall be read as references to “Share Termination Delivery Units”. “Share Termination Settled” in relation to the Transaction means that the Share Termination Alternative is applicable to the Transaction.
|
(A)
|
With respect to any Transfer Options, Counterparty shall not be released from its notice and indemnification obligations pursuant to Section 8(e) or any obligations under (x) Section 8(d) of this Confirmation or (y) in respect of any Extraordinary Event occurring prior to such transfer;
|
(B)
|
Any Transfer Options shall only be transferred or assigned to a third party that is a United States person (as defined in the Internal Revenue Code of 1986, as amended);
|
(C)
|
Such transfer or assignment shall be effected on terms, including any reasonable undertakings by such third party (including, but not limited to, an undertaking with respect to compliance with applicable securities laws in a manner that, in the reasonable judgment of Dealer, will not expose Dealer to material risks under applicable securities laws) and execution of any documentation and delivery of legal opinions with respect to securities laws and other matters by such third party and Counterparty, as are requested and reasonably satisfactory to Dealer;
|
(D)
|
Dealer will not, as a result of such transfer and assignment, be required to pay the transferee on any payment date an amount under Section 2(d)(i)(4) of the Agreement greater than an amount that Dealer would have been required to pay to Counterparty in the absence of such transfer and assignment;
|
(E)
|
An Event of Default, Potential Event of Default or Termination Event will not occur as a result of such transfer and assignment;
|
(F)
|
Without limiting the generality of clause (B), Counterparty shall cause the transferee to make such Payee Tax Representations and to provide such tax documentation as may be reasonably requested by Dealer to permit Dealer to determine that results described in clauses (D) and (E) will not occur upon or after such transfer and assignment; and
|
(G)
|
Counterparty shall be responsible for all reasonable costs and expenses, including reasonable counsel fees, incurred by Dealer in connection with such transfer or assignment.
|
PROS HOLDINGS, INC.
|
|
|
|
By:
|
|
Name:
|
|
Title:
|
|
[LEGAL NAME OF SIGNATOR]
:
|
|
(in its capacities described in the first paragraph hereof)
|
By:
|
Name:
|
Title:
|
TERMINATION AGREEMENT
dated as of May [__], 2019
|
Between PROS Holdings, Inc. and [_________]
|
(a)
|
Subject to clause ý(c) below, as of the Notes Settlement Date (as defined below):
|
(i)
|
The Additional Convertible Bond Hedge Transaction shall be terminated in full, and all of the respective rights and obligations of the parties under the Additional Convertible Bond Hedge Confirmation shall be cancelled and terminated, and each party shall be released and discharged by the other party, and agrees not to make any claim with respect to any obligations of the other party, in connection with such transactions;
provided
that the representations and warranties contained or incorporated by reference in the Additional Convertible Bond Hedge Confirmation, and any indemnification or contribution obligations contained therein arising as a result of events occurring on or prior to the Notes Settlement Date, shall survive such termination.
|
(ii)
|
The Number of Options under the Base Convertible Bond Hedge Transaction shall be reduced by [_____], and immediately following such reduction the Number of Options thereunder will be equal to [_____].
|
(b)
|
Subject to clause ý(c) below, on the Notes Settlement Date, Dealer shall pay to Company an amount in USD equal to the Cash Settlement Amount.
|
(c)
|
The terminations and amendments set forth in clause ý(a) above, and the payment obligation set forth in clause ý(b) above, shall be effective only upon the occurrence of the Notes Settlement Date. If the initial issuance of the New Convertible Securities occurs on or prior to May [___], 2019, then the “
Notes Settlement Date
” hereunder shall be such closing date. If such issuance does not occur on or prior to May [__], 2019, then, unless otherwise agreed by the Dealer in writing, no Notes Settlement Date shall occur hereunder, in which case (i) no Cash Settlement Amount will be owed hereunder, (ii) this Agreement shall have no further force or effect, and (iii) the Convertible Bond Hedge Transactions under the Convertible Bond Hedge Confirmations shall remain in full force and effect.
|
(a)
|
Company is not, and after consummation of the transactions contemplated hereby will not be, required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended;
|
(b)
|
Company is an “eligible contract participant” (as such term is defined in Section 1a(18) of the Commodity Exchange Act, as amended, other than a person that is an eligible contract participant under Section 1a(18)(C) of the Commodity Exchange Act);
|
(c)
|
None of Company and its officers and directors is, on the date hereof, aware of any material non-public information with respect to Issuer or the Shares;
|
(d)
|
to Company’s knowledge, no U.S. state or local law, rule, regulation or regulatory order applicable to the Shares would give rise to any reporting, consent, registration or other requirement (including without limitation a requirement to obtain prior approval from any person or entity) as a result of Dealer or its affiliates owning or holding (however defined) Shares;
provided
that no such representation shall be made by Company with respect to any rules and regulations applicable to Dealer (including Financial Industry Regulatory Authority rules) arising from Dealer’s status as a regulated entity under applicable law;
|
(e)
|
Company (A) is capable of evaluating investment risks independently, both in general and with regard to all transactions and investment strategies involving a security or securities; (B) will exercise independent judgment in evaluating the recommendations of any broker-dealer or its associated persons, unless it has otherwise notified the broker-dealer in writing; and (C) has total assets of at least $50 million; and
|
(f)
|
Company is not entering into this Agreement to create actual or apparent trading activity in the Shares (or any security convertible into or exchangeable for the Shares) or to raise or depress or otherwise manipulate the price of the Shares (or any security convertible into or exchangeable for the Shares) or otherwise in violation of the Exchange Act.
|
(g)
|
On the date hereof and the Notes Settlement Date, Company is not and will not be “insolvent” (as such term is defined under Section 101(32) of the U.S. Bankruptcy Code (Title 11 of the United States Code).
|
(a)
|
it is duly organized and validly existing under the laws of the jurisdiction of its organization or incorporation and, if relevant under such laws, in good standing;
|
(b)
|
it has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver this Agreement and to perform its obligations under this Agreement and has taken all necessary action to authorize such execution, delivery and performance;
|
(c)
|
such execution, delivery and performance do not violate or conflict with any law applicable to it, any provision of its constitutional documents, any order or judgment of any court or other agency of government applicable to it or any of its assets or any contractual restriction binding on or affecting it or any of its assets;
|
(d)
|
all governmental and other consents that are required to have been obtained by it with respect to this Agreement have been obtained and are in full force and effect and all conditions of any such consents have been complied with; and
|
(e)
|
its obligations under this Agreement constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting creditors’ rights generally and subject, as to enforceability, to equitable principles of general application (regardless of whether enforcement is sought in a proceeding in equity or at law)).
|
[__________________]
|
|||
By:
|
|
||
|
Name:
Title:
|
|
|
By:
|
|
||
|
Name:
Title:
|
|
PROS Holdings, Inc.
|
||
|
|
|
Name:
Title:
|
|
|
TERMINATION AGREEMENT
dated as of May [___], 2019
|
Between PROS Holdings, Inc. and [_______]
|
(a)
|
Subject to clause ý(c) below, as of the Notes Settlement Date (as defined below):
|
(i)
|
The Additional Issuer Warrant Transaction shall be terminated in full, and all of the respective rights and obligations of the parties under the Additional Issuer Warrant Confirmation shall be cancelled and terminated, and each party shall be released and discharged by the other party, and agrees not to make any claim with respect to any obligations of the other party, in connection with such transactions;
provided
that the representations and warranties contained or incorporated by reference in the Additional Issuer Warrant Confirmation, and any indemnification or contribution obligations contained therein arising as a result of events occurring on or prior to the Notes Settlement Date, shall survive such termination.
|
(ii)
|
The Number of Warrants per Component under the Base Issuer Warrant Transaction shall be reduced by (i) [_____] for each of Component Numbers [__] through [___] and immediately following such reduction the Number of Warrants for each such Component shall be [___], (ii) [___] for Component Number [___] and immediately following such reduction the Number of Warrants for such Component shall be [____] and (iii) [_____] for each of Component Numbers [___] through [___] and immediately following such reduction the Number of Warrants for each such Component shall be [___].
|
(b)
|
Subject to clause ý(c) below, on the Notes Settlement Date, Company shall pay to Dealer an amount in USD equal to the Cash Settlement Amount.
|
(c)
|
The terminations and amendments set forth in clause ý(a) above, and the payment obligation set forth in clause ý(b) above, shall be effective only upon the occurrence of the Notes Settlement Date. If the initial issuance of the New Convertible Securities occurs on or prior to May [__], 2019, then the “
Notes Settlement Date
” hereunder shall be such closing date. If such issuance does not occur on or prior to May [__], 2019, then, unless otherwise agreed by the Dealer in writing, no Notes Settlement Date shall occur hereunder, in which case (i) no Cash Settlement Amount will be owed hereunder, (ii) this Agreement shall have no further force or effect, and (iii) the Issuer Warrant Transactions under the Issuer Warrant Confirmations shall remain in full force and effect.
|
(a)
|
Company is not, and after consummation of the transactions contemplated hereby will not be, required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended;
|
(b)
|
Company is an “eligible contract participant” (as such term is defined in Section 1a(18) of the Commodity Exchange Act, as amended, other than a person that is an eligible contract participant under Section 1a(18)(C) of the Commodity Exchange Act);
|
(c)
|
None of Company and its officers and directors is, on the date hereof, aware of any material non-public information with respect to Issuer or the Shares;
|
(d)
|
to Company’s knowledge, no U.S. state or local law, rule, regulation or regulatory order applicable to the Shares would give rise to any reporting, consent, registration or other requirement (including without limitation a requirement to obtain prior approval from any person or entity) as a result of Dealer or its affiliates owning or holding (however defined) Shares;
provided
that no such representation shall be made by Company with respect to any rules and regulations applicable to Dealer (including Financial Industry Regulatory Authority rules) arising from Dealer’s status as a regulated entity under applicable law;
|
(e)
|
Company (A) is capable of evaluating investment risks independently, both in general and with regard to all transactions and investment strategies involving a security or securities; (B) will exercise independent judgment in evaluating the recommendations of any broker-dealer or its associated persons, unless it has otherwise notified the broker-dealer in writing; and (C) has total assets of at least $50 million; and
|
(f)
|
Company is not entering into this Agreement to create actual or apparent trading activity in the Shares (or any security convertible into or exchangeable for the Shares) or to raise or depress or otherwise manipulate the price of the Shares (or any security convertible into or exchangeable for the Shares) or otherwise in violation of the Exchange Act.
|
(g)
|
On the date hereof and the Notes Settlement Date, Company is not and will not be “insolvent” (as such term is defined under Section 101(32) of the U.S. Bankruptcy Code (Title 11 of the United States Code).
|
(a)
|
it is duly organized and validly existing under the laws of the jurisdiction of its organization or incorporation and, if relevant under such laws, in good standing;
|
(b)
|
it has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver this Agreement and to perform its obligations under this Agreement and has taken all necessary action to authorize such execution, delivery and performance;
|
(c)
|
such execution, delivery and performance do not violate or conflict with any law applicable to it, any provision of its constitutional documents, any order or judgment of any court or other agency of government applicable to it or any of its assets or any contractual restriction binding on or affecting it or any of its assets;
|
(d)
|
all governmental and other consents that are required to have been obtained by it with respect to this Agreement have been obtained and are in full force and effect and all conditions of any such consents have been complied with; and
|
(e)
|
its obligations under this Agreement constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting creditors’ rights generally and subject, as to enforceability, to equitable principles of general application (regardless of whether enforcement is sought in a proceeding in equity or at law)).
|
[__________________]
|
|||
By:
|
|
||
|
Name:
Title:
|
|
|
PROS Holdings, Inc.
|
|||
By:
|
|
||
|
Name:
Title:
|
|