Open Text Corp SC TO-T/A, filed Dec 23, 2021
Open Text Corp (OTEX)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE TO
(RULE 14d-100)
Tender Offer Statement Pursuant to Section 14(d)(1) or 13(e)(1)
of the Securities Exchange Act of 1934
(Amendment No. 4)
Zix Corporation
(Name of Subject Company)
Zeta Merger Sub Inc.
(Offeror)
Open Text Corporation
(Parent of Offeror)
(Names of Filing Persons)
COMMON STOCK, PAR VALUE $0.01 PER SHARE
(Title of Class of Securities)
98974P100
(CUSIP Number of Class of Securities)
Gordon A. Davies
Open Text Corporation
Executive Vice President, Chief Legal Officer and Corporate Development
275 Frank Tompa Drive, Waterloo, Ontario, Canada N2L 0A1
519-888-7111
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications on Behalf of Filing Persons)
Copies to:
James E. Langston
Aaron J. Meyers
Cleary Gottlieb Steen & Hamilton LLP
One Liberty Plaza
New York, New York 10006
212-225-2000
CALCULATION OF FILING FEE
| Transaction Valuation* | Amount of Filing Fee* | |
|
$699,670,491.00 |
$64,859.45 | |
|
| ||
| * | Estimated solely for purposes of calculating the filing fee pursuant to Rule 0-11(d) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Transaction Valuation was calculated on the basis of the sum of (a) the product of (x) 56,790,468 shares of common stock issued and outstanding and (y) the offer price of $8.50 per share, (b) the product of (x) 777,010 shares issuable upon the exercise of outstanding options with an exercise price less than the offer price of $8.50 per share and (y) $4.05 per share, which is the offer price of $8.50 per share less the weighted-average exercise price for such options, (c) the product of (x) 2,715,756 shares issuable pursuant to granted and outstanding restricted stock units and performance stock units and (y) the offer price of $8.50 per share, (d) the product of (x) 1,596,829 shares issuable pursuant to granted and outstanding restricted common stock and restricted performance common stock and (y) the offer price of $8.50 per share, and (f) the product of (x) 20,840,900 shares of common stock issuable pursuant to the conversion of preferred stock on December 20, 2021 and (y) the offer price of $8.50 per share. |
| ** | The filing fee was calculated in accordance with Rule 0-11 under the Exchange Act and Fee Rate Advisory #1for fiscal year 2022, effective October 1, 2021, by multiplying the transaction value by 0.00009270. |
| ☒ | Check box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
| Amount Previously Paid: $64,859.45 |
Filing Party: Zeta Merger Sub Inc. And Open Text Corporation | |
| Form or Registration No.: Schedule TO |
Date Filed: November 22, 2021 |
| ☐ | Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer. |
Check the appropriate boxes below to designate any transactions to which the statement relates:
| ☒ | third-party tender offer subject to Rule 14d-1. |
| ☐ | issuer tender offer subject to Rule 13e-4. |
| ☐ | going-private transaction subject to Rule 13e-3. |
| ☒ | amendment to Schedule 13D under Rule 13d-2. |
Check the following box if the filing is a final amendment reporting the results of the tender offer. ☒
If applicable, check the appropriate box(es) below to designate the appropriate rule provision(s) relied upon:
| ☐ | Rule 13e-4(i) (Cross-Border Issuer Tender Offer) |
| ☐ | Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) |
| CUSIP No. 98974P100 | 13D |
| 1 |
NAMES OF REPORTING PERSONS
Open Text Corporation | |||||
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (see instructions) (a) ☐ (b) ☐
| |||||
| 3 | SEC USE ONLY
| |||||
| 4 | SOURCE OF FUNDS (see instructions)
WC | |||||
| 5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e)
☐ | |||||
| 6 | CITIZENSHIP OR PLACE OF ORGANIZATION
Canada | |||||
| NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7 | SOLE VOTING POWER
1,000 | ||||
| 8 | SHARED VOTING POWER
0 | |||||
| 9 | SOLE DISPOSITIVE POWER
1,000 | |||||
| 10 | SHARED DISPOSITIVE POWER
0 | |||||
| 11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,000 | |||||
| 12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (see instructions)
☐ | |||||
| 13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
100% | |||||
| 14 | TYPE OF REPORTING PERSON
CO | |||||
This Amendment No. 4 (this “Amendment”) amends and supplements the Tender Offer Statement on Schedule TO, as amended and supplemented by Amendment No. 1 filed on December 8, 2021, Amendment No. 2 filed on December 14, 2021, and Amendment No. 3 filed on December 21, 2021 filed by Zeta Merger Sub Inc., a Texas corporation (“Purchaser”) that is a wholly-owned subsidiary of Open Text Corporation, a corporation incorporated under the federal laws of Canada (“OpenText”), with the Securities and Exchange Commission on November 22, 2021 (together with any subsequent amendments and supplements thereto, including this Amendment, the “Schedule TO”). The Schedule TO relates to the tender offer by Purchaser for all shares of common stock of Zix Corporation, a Texas corporation (“Zix”), par value $0.01 per share (each, a “Share”), that are issued and outstanding, at a price of $8.50 per Share, in cash, without interest and subject to any applicable withholding of taxes, upon the terms and subject to the conditions set forth in the Offer to Purchase dated November 22, 2021 (the “Offer to Purchase”), a copy of which is attached to the Schedule TO as Exhibit (a)(1)(A), and in the related letter of transmittal (the “Letter of Transmittal”), a copy of which is attached to the Schedule TO as Exhibit (a)(1)(B) (and which, together with the Offer to Purchase and other related materials, as each may be amended or supplemented from time to time, collectively constitute the “Offer”).
All capitalized terms used but not defined in this Amendment No. 4 shall have the meanings assigned to such terms in the Schedule TO.
The items of the Schedule TO set forth below are hereby amended and supplemented as follows:
Amendments to the Schedule TO
The Offer to Purchase and Items 1-9 and 11 of the Schedule TO are hereby amended and supplemented by adding the following paragraphs at the end thereof:
“Consummation of the Offer and the Merger.
On Thursday, December 23, 2021, OpenText announced the expiration of the Offer at one minute after 11:59 P.M., Eastern time on December 22, 2021. The Depositary for the Offer has advised OpenText and Purchaser that immediately prior to the Expiration Time on Wednesday, December 22, 2021, there were validly tendered and not withdrawn (and excluding any Shares tendered pursuant to guaranteed delivery procedures that were not yet delivered in satisfaction of such guarantee in accordance with Section 21.459(c) of the TBOC)), a total of 55,709,092 Shares. The validly tendered Shares represent approximately 71% of the Shares outstanding immediately prior to the Expiration Time. The number of Shares tendered into the Offer satisfied the Minimum Condition immediately prior to the Expiration Time. All conditions to the Offer have been satisfied. Purchaser has accepted for payment all Shares that were validly tendered pursuant to the Offer and not withdrawn prior to the Expiration Time.
On December 23, 2021, following the expiration of the Offer and acceptance for payment of the Shares tendered pursuant to the Offer, OpenText completed its acquisition of Zix pursuant to the terms of the Merger Agreement. Pursuant to the terms and conditions of the Merger Agreement, Purchaser merged with and into Zix, with Zix surviving the Merger as a wholly-owned subsidiary of OpenText, without a stockholder vote to adopt the Merger Agreement or effect the Merger in accordance with Section 21.459(c) of the TBOC. As a result of the Merger, each Share outstanding immediately prior to the Effective Time was converted into the right to receive the Merger Consideration in cash, without interest, and subject to any applicable withholding of taxes (which is the same amount per Share that will be paid in the Offer), other than Shares held by OpenText or Zix, or by any wholly-owned subsidiary of OpenText (including Purchaser) or Zix, or held by stockholders who properly exercised appraisal rights under Subchapter H, Chapter 10 of the TBOC or Shares irrevocably accepted for purchase pursuant to the Offer.
As a result of the Merger, the Shares will be delisted and will cease trading on the Nasdaq. OpenText and Purchaser intend to take steps to cause the termination of the registration of the Shares under the Exchange Act and to suspend all of Zix’s reporting obligations under the Exchange Act as promptly as practicable.
The full text of the press release issued by OpenText on December 23, 2021 in connection with the expiration of the Offer and the Merger is attached hereto as Exhibit (a)(5)(N) and is incorporated herein by reference.”
Item 12. Exhibits.
Item 12 of the Schedule TO is hereby amended and supplemented with the following:
| Exhibit No. |
Description | |
| (a)(5)(N) | Press Release issued by Open Text Corporation on December 23, 2021 | |
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
Dated: December 23, 2021
| OPEN TEXT CORPORATION | ||||
| By: | /s/ Gordon A. Davies | |||
| Name: Gordon A. Davies | ||||
| Title: EVP, CLO and Corporate Development | ||||
| ZETA MERGER SUB INC. | ||||
| By: | /s/ Gordon A. Davies | |||
| Name: Gordon A. Davies | ||||
| Title: Secretary | ||||
EXHIBIT INDEX
Exhibit (a)(5)(N)
OpenText Buys Zix Corporation
Waterloo, ON – December 23, 2021 - OpenText™ (NASDAQ: OTEX), (TSX: OTEX) today announced that it has completed the closing of the previously announced acquisition of Zix Corporation (NASDAQ: ZIXI) (“Zix”), a leader in SaaS-based email encryption, threat protection and compliance cloud solutions for Small and Medium-sized Businesses (SMBs).
“I would like to welcome Zix customers, partners, and employees to OpenText. Combined, we will be able to provide our customers a powerhouse SMB platform for data protection, threat management, email security and compliance solutions,” said OpenText CEO & CTO Mark J. Barrenechea. “Zix meaningfully expands our distribution capabilities with MSP partners, enhances our SMB offering and deepens our go-to-market relationship with Microsoft.”
Barrenechea further added, “OpenText is committed to winning Information Management in both the Enterprise and SMB markets. We are targeting for Zix to be on our operating model within 12-18 months and as previously highlighted, once integrated, we expect Zix to be accretive to organic growth and margin dollars.”
Preliminary Financial Overview
OpenText expects no material revenue or operating expenses from Zix over the holiday season between December 23rd and 31st, within the current quarter (Fiscal 2022 Q2). Further financial projections from OpenText, as well as updated target models, will be provided when the company reports its second quarter Fiscal 2022 financial & business results.(1)
Terms of the Acquisition
| • | The tender offer for all outstanding Zix common stock (including shares of common stock issued upon conversion of Zix’s Series A Preferred Stock) for $8.50 per share in cash is now complete and Zix is now a wholly-owned subsidiary of OpenText |
| • | Total purchase price of approximately $860 million, inclusive of Zix’s cash and debt |
| • | The total purchase price is approximately 3.5x TTM (Trailing Twelve Months) Zix GAAP revenues (as of September 30, 2021) |
| • | Zix Reported Annual Recurring Revenues (ARR) of 90% |
| • | Accretive and expected to be on the OpenText operating model within 12-18 months |
| • | Funded with OpenText’s existing cash on hand |
| (1) | Upon closing, Zix’s resell business will be reported on a “net” basis to conform to OpenText’s revenue recognition policies. The net basis recognition will result in Zix’s immediate conformance to OpenText Gross Margin Model. |
About OpenText
OpenText, The Information Company™, enables organizations to gain insight through market leading information management solutions, powered by OpenText Cloud Editions. For more information about OpenText (NASDAQ: OTEX, TSX: OTEX) visit opentext.com
Cautionary Statement Regarding Forward-Looking Statements
Certain statements in this press release, including statements regarding OpenText’s plans, objectives, expectations and intentions relating to the acquisition, the acquisition’s expected contribution to OpenText’s results, financing and closing of the acquisition, as well as the expected timing and benefits of the acquisition, impact on future financial performance including in respect of annual recurring revenues, cloud growth, adjusted EBITDA, cash flows and earnings, may contain words considered forward-looking statements or information under applicable securities laws. These statements are based on OpenText’s current expectations, estimates, forecasts and projections about the operating environment, economies and markets in which OpenText operates, as well as the impact of the ongoing COVID-19 pandemic. These statements are subject to important assumptions, risks and uncertainties that are difficult to predict, and the actual outcome may be materially different. OpenText’s assumptions, although considered reasonable by the company at the date of this press release, may prove to be inaccurate and consequently its actual results could differ materially from the expectations set out herein. For additional information with respect to risks and other factors, which could occur, see OpenText’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other securities filings with the SEC and other securities regulators. Unless otherwise required by applicable securities laws, OpenText disclaims any intention or obligations to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Copyright © 2021 OpenText. All Rights Reserved. Trademarks owned by OpenText. One or more patents may cover this product(s). For more information, please visit https://www.opentext.com/patents.
Note: All dollar amounts in this press release are in US dollars unless otherwise indicated.
OTEX-MNA
Further information, please contact:
Harry E. Blount
Senior Vice President, Investor Relations
Open Text Corporation
415-963-0825
investors@opentext.com