UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of The Securities Exchange Act of 1934
Date of report (Date of earliest event reported): December 3, 2017
EXACTECH, INC.
(Exact Name of Registrant as Specified in Its Charter)
| Florida | 0-28240 | 59-2603930 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
2320 NW 66th Court
Gainesville, Florida 32653
(Address of Principal Executive Offices) (Zip Code)
(352) 377-1140
(Registrant’s Telephone Number, Including Area Code)
N/A
(Former Name or Former Address, if Changed Since Last Report)
Copies of all communications to:
| Greenberg Traurig, LLP MetLife Building 200 Park Avenue New York, NY 10166 (212) 801-9200 Attn: Clifford E. Neimeth, Esq. neimethc@gtlaw.com |
Greenberg Traurig, P.A. 333 S.E. 2nd Avenue Suite 4400 Miami, FL 33131 (305) 579-0500 Attn: Jaret L. Davis, Esq. Drew M. Altman, Esq. davisj@gtlaw.com altmand@gtlaw.com |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☒ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 1.01 | Entry into a Material Definitive Agreement. |
As previously announced, on October 22, 2017, Exactech, Inc., a Florida corporation (the “Company”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Osteon Holdings, L.P., a Delaware limited partnership (“Parent”), and Osteon Merger Sub, Inc., a Florida corporation and wholly owned subsidiary of Parent (“Merger Sub”). Parent and Merger Sub are affiliates of global private equity firm TPG Capital, which, in turn, is an affiliate of global alternative asset firm TPG.
On December 3, 2017, the Company entered into an amendment to the Merger Agreement (“Amendment No. 1 to the Merger Agreement”) with Parent and Merger Sub. Capitalized terms used and not defined herein have the respective meanings assigned to them in the Merger Agreement, as amended by Amendment No. 1 thereto.
Pursuant to Amendment No. 1 to the Merger Agreement, the Merger Consideration has been increased from $42.00 per share of Company Common Stock to $49.25 per share of Company Common Stock, without interest and less any applicable withholding taxes, and excluding certain shares of Company Common Stock held by the Company’s founders and certain management shareholders who have agreed to contribute to Parent, at a valuation equal to or less than $49.25 per share, a portion of their shares for new equity securities of Parent. Amendment No. 1 to the Merger Agreement also eliminates the previous “No Company Material Adverse Effect” closing condition and the Company’s previous contractual obligations to cooperate with TPG Capital and assist it with any potential debt financing that TPG Capital may seek to obtain in connection with the Merger.
There remains no financing condition to the Merger. As previously announced, on October 22, 2017, the Company entered into an equity commitment letter (the “Financing Letter”), together with TPG Partners VII, L.P., a Delaware limited partnership (the “Fund”), and Parent, pursuant to which, subject to certain conditions, the Fund committed to make an equity contribution to Parent in an aggregate amount of up to approximately $624.7 million for purposes of consummating the Merger. In connection with Amendment No. 1 to the Merger Agreement, the Company has entered into an amendment to the Financing Letter (the “First Amendment to the Financing Letter”), pursuant to which the Fund has increased its equity contribution commitment to Parent to $737.0 million for purposes of consummating the Merger.
Except as expressly modified by Amendment No. 1 to the Merger Agreement and the First Amendment to the Financing Letter, all terms, covenants and provisions of the Merger Agreement and the Financing Letter remain in full force and effect. Copies of Amendment No. 1 to the Merger Agreement and the First Amendment to the Financing Letter have been filed as exhibits to this Current Report on Form 8-K to provide investors with information regarding their terms. It is not intended to provide any other factual information about the Company, Parent Merger Sub or any of their respective subsidiaries or affiliates. The representations, warranties and covenants contained in the Merger Agreement, as amended, were made only for purposes of that agreement and as of specific dates; were made solely for the benefit of the parties to the Merger Agreement; as amended; may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures; may not have been intended to be statements of fact, but rather, as a method of allocating contractual risk and governing the contractual rights and relationships between the parties to the Merger Agreement, as amended; and may be subject to standards of materiality applicable to contracting parties that differ from those applicable to investors. Investors should not rely on the representations, warranties and
covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the Company, Parent, Merger Sub or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations, warranties and covenants may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in the Company’s or Parent’s public disclosures. The holders of Company Common Stock and other investors are not third-party beneficiaries under the Merger Agreement, as amended.
The foregoing description of Amendment No. 1 to the Merger Agreement and the First Amendment to the Financing Letter are only summaries and are qualified in their entirety by reference to the complete text of Amendment No. 1 to the Merger Agreement and the First Amendment to the Financing Letter, which are filed as Exhibit 2.1 and Exhibit 10.1, respectively, to this Current Report on Form 8-K and incorporated herein by reference.
| Item 8.01 | Other Events. |
On December 4, 2017, the Company and Parent issued a joint press release announcing the execution of Amendment No. 1 to the Merger Agreement, a copy of which has been filed as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference in this Item 8.01.
Additionally, as previously announced, the Company’s founders and certain members of the Company’s management have entered into a rollover and voting agreement with Parent (the “Rollover Agreement”), dated October 22, 2017, pursuant to which, subject to certain exceptions, such persons have agreed to vote all of their respective shares of Company Common Stock, aggregating approximately 23.0% of the outstanding Company Common Stock, in favor of the Merger.
In connection with Amendment No. 1 to the Merger Agreement, the parties to the Rollover Agreement have entered into an amendment to the Rollover Agreement (“Amendment No. 1 to the Rollover Agreement”), pursuant to which the Company’s founding and management shareholders have agreed to contribute to Parent an aggregate amount of 2,711,584 shares of Company Common Stock they currently own (representing approximately 18.8% of the outstanding Company Common Stock) for equity securities of Parent. A copy of Amendment No. 1 to the Rollover Agreement is filed as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated by reference in this Item 8.01. The description of Amendment No. 1 to the Rollover Agreement in this Form 8-K is subject to, and qualified in its entirety by, the full text of Amendment No. 1 to the Rollover Agreement.
On November 7, 2017, the Company received an unsolicited, non-binding proposal from a non-U.S. private equity firm and certain of its affiliates, including one of its portfolio companies which conducts orthopaedic implant device operations (“Party A”), to acquire 100% of the Company’s outstanding common stock at $49.00 per share in cash in a statutory merger transaction. Party A’s non-binding proposal was reaffirmed on November 14, 2017 and again on December 1, 2017, and currently remains subject to the completion of Party A’s due diligence investigation of the Company. The description of Party A’s unsolicited, non-binding proposal in this Form 8-K is subject to, and qualified in its entirety by, the full text of the joint press release, a copy of which has been filed as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference in this Item 8.01.
Forward-Looking Statements
This Current Report on Form 8-K includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements include, but are not limited to, statements regarding the Company’s proposed business combination transaction with TPG Capital, all statements regarding the Company’s expected future financial position, results of operations, cash flows, dividends, financing plans, business strategy, budgets, capital expenditures, competitive positions, growth opportunities, plans and objectives of management, and statements containing the words such as “anticipate,” “approximate,” “believe,” “plan,” “estimate,” “expect,” “project,” “could,” “would,” “should,” “will,” “intend,” “may,” “potential,” “upside,” and other similar expressions. All Statements in this press release that are not historical facts, are forward-looking statements that reflect the best judgment of the Company based upon currently available information.
Such forward-looking statements are inherently uncertain, and shareholders and other potential investors must recognize that actual results may differ materially from the Company’s expectations as a result of a variety of factors, including, without limitation, those discussed below. Such forward-looking statements are based upon management’s current expectations and include known and unknown risks, uncertainties and other factors, many of which the Company is unable to predict or control, that may cause its actual results, performance or plans to differ materially from any future results, performance or plans expressed or implied by such forward-looking statements. These statements involve risks, uncertainties and other factors discussed below and detailed from time to time in the Company’s filings with the Securities and Exchange Commission (the “SEC”).
Risks and uncertainties related to the proposed Merger include, but are not limited to, the risk that the Company’s shareholders do not approve the Merger, potential adverse reactions or changes to business relationships resulting from the announcement or completion of the Merger, uncertainties as to the timing of the Merger, adverse effects on the Company’s stock price resulting from the announcement of the Merger or the failure of the Merger to be completed, competitive responses to the announcement of the Merger, the risk that regulatory, licensure or other approvals required for the consummation of the Merger are not obtained or are obtained subject to terms and conditions that are not anticipated, litigation relating to the Merger, the inability to retain key personnel, and any changes in general economic and/or industry-specific conditions.
In addition to the factors set forth above, other factors that may affect the Company’s plans, results or stock price are set forth in its most recent Annual Report on Form 10-K and in its subsequently filed reports on Forms 10-Q and 8-K.
Many of these factors are beyond the Company’s control. The Company cautions investors that any forward-looking statements made by it are not guarantees of future performance. The Company disclaims any obligation to update any such factors or to announce publicly the results of any revisions to any of the forward-looking statements to reflect future events or developments.
Additional Information and Where to Find It
This report does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. This communication may be deemed to be solicitation material in respect of the proposed Merger. In connection with the Merger, the Company will prepare and mail a proxy statement to its shareholders. In addition, certain
participants in the merger will file with the SEC a Schedule 13E-3 transaction statement. These documents will be filed with or furnished to the SEC. Investors and shareholders are urged to read carefully and in their entirety these materials and other materials filed with or furnished to the SEC when they become available, as they will contain important information about the Company, the merger and related matters. In addition to receiving the proxy statement by mail, shareholders also will be able to obtain the proxy statement and Schedule 13E-3 transaction statement, as well as other filings containing information about the Company, the merger and related matters, without charge, from the SEC’s website (http://www.sec.gov). In addition, these documents can be obtained, without charge, by sending an e-mail to investors@exac.com, along with complete contact details and a mailing address.
Participants in Solicitation
The Company and certain of its directors, executive officers and other members of management and employees may, under SEC rules, be deemed to be “participants” in the solicitation of proxies from shareholders with respect to the Merger. Information regarding the persons or entities who may be considered “participants” in the solicitation of proxies will be set forth in the proxy statement and Schedule 13E-3 transaction statement relating to the Merger when each is filed with the SEC. Information regarding the directors and executive officers of the Company is set forth in the proxy statement for the Company’s 2017 Annual Meeting of Shareholders, which was filed with the SEC on March 24, 2017. Additional information regarding the interests of such potential participants will be included in the proxy statement and Schedule 13E-3 transaction statement and the other relevant documents filed with the SEC when they become available.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| EXACTECH, INC. | ||||||
| Date: December 4, 2017 | By: | /s/ Joel C. Phillips | ||||
| Name: Joel C. Phillips | ||||||
| Title: Chief Financial Officer | ||||||
Exhibit 2.1
Execution Version
AMENDMENT NO. 1
TO THE
AGREEMENT AND PLAN OF MERGER
This AMENDMENT NO. 1 (this “Amendment”) is made and entered into as of December 3, 2017, by and among OSTEON HOLDINGS, L.P., a Delaware limited partnership (“Parent”), OSTEON MERGER SUB, INC., a Florida corporation and wholly-owned direct or indirect subsidiary of Parent (“Merger Sub”), and EXACTECH, INC., a Florida corporation (the “Company”), to amend that certain AGREEMENT AND PLAN OF MERGER, dated as of October 22, 2017, by and among Parent, Merger Sub and the Company (as amended hereby, and as it may have been and may be further amended from time to time, the “Merger Agreement”).
WHEREAS, Section 8.04 of the Merger Agreement provides for the amendment of the Merger Agreement in accordance with the terms set forth therein;
WHEREAS, the Board of Directors of the Company has (i) determined that it is in the best interests of the Company and its shareholders to enter into this Amendment, (ii) approved the execution, delivery and performance of this Amendment and the consummation of the transactions contemplated hereby, including the Merger, and (iii) resolved to recommend adoption of the Merger Agreement, as amended by this Amendment, by the shareholders of the Company;
WHEREAS, the general partner of Parent has approved this Amendment and declared it advisable for Parent to enter into this Amendment, and the Board of Directors of Merger Sub has approved this Amendment and declared it advisable for Merger Sub to enter into this Amendment; and
WHEREAS, the parties hereto desire to amend the Merger Agreement as set forth below.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements set forth herein and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound hereby, the parties hereto do hereby agree as follows:
1. Merger Consideration.
(a) The first recital of the Merger Agreement is hereby amended by deleting the number “$42.00” therein and replacing it with “$49.25”.
(b) Section 2.01(c) of the Merger Agreement is hereby amended by deleting the number “$42.00” therein and replacing it with “$49.25”.
2. Amendments to Section 3.09. Section 3.09(c) of the Merger Agreement is hereby amended by adding the following sentence to the end thereof: “Notwithstanding the foregoing, the Financing Letter was amended as of December 3, 2017, with the written consent of the Company.”
3. Amendments to Section 4.22. Section 4.22 of the Merger Agreement is hereby amended to add the following sentence at the end thereof:
“On December 2, 2017, the Company received the opinion of the Company Financial Advisor, dated as of December 2, 2017, that, as of such date and subject to the limitations, qualifications and assumptions set forth therein, the Merger Consideration (upon giving effect to Amendment No. 1 to the Agreement) is fair, from a financial point of view, to the holders of Company Common Stock.”
4. Amendments to Section 5.06. Section 5.06 of the Merger Agreement is amended by deleting the text of such section in its entirety and replacing such text with the phrase “[Reserved.]”.
5. Amendments to Section 7.03.
(a) Section 7.03(c) of the Merger Agreement is amended by deleting the text of such section in its entirety and replacing such text with the phrase “[Reserved.]”.
(b) Section 7.03(d) of the Merger Agreement is amended by replacing the phrase “the conditions set forth in Sections 7.03(a), Section 7.03(b) and Section 7.03(c)” with the phrase “the conditions set forth in Sections 7.03(a) and 7.03(b)”.
6. Amendments to Section 9.03.
(a) The definition of “Debt Financing Deliverables” set forth in Section 9.03 is hereby deleted in its entirety.
(b) The definition of “Debt Financing Documents” set forth in Section 9.03 is hereby deleted in its entirety.
(c) The definition of “Debt Financing Information” set forth in Section 9.03 is hereby deleted in its entirety.
(d) The definition of “Termination Fee” set forth in Section 9.03 of the Merger Agreement is hereby amended by replacing the number “$21,865,000” therein with the number “$25,797,000”.
(e) The definition of “Company Material Adverse Effect” set forth in Section 9.03 of the Merger Agreement is hereby amended by adding in the first proviso, immediately following the phrase “any fact, circumstance, occurrence, effect, change, event or development arising from or related to”, the phrase “the following shall not, individually or in the aggregate, be taken into account for purposes of determining the occurrence, existence or likelihood to occur of a Company Material Adverse Effect”.
7. Amendments to Section 9.12(c)(iii)(A). Section 9.12(c)(iii)(A) is hereby amended by replacing the number “$624,704,000” therein with the number “$737,057,000”.
8. Financing. Parent has delivered to the Company the executed amendment to the Financing Letter attached hereto as Annex A, and the Company hereby consents to such amendment of the Financing Letter. The Financing Letter, as so amended, shall be deemed to be the “Financing Letter” referred to in the Merger Agreement and the commitment of the parties thereto to provide the amount of equity financing set forth therein to Parent shall be deemed to be the “Financing” referred to in the Merger Agreement.
9. Proxy Statement and Schedule 13E-3. The parties hereto hereby acknowledge and agree that simultaneously with the execution and delivery of this Amendment by Parent, Merger Sub and the Company, (i) the parties hereto agree that the forms of the Proxy Statement and Schedule 13E-3 as on the system of R.R. Donnelley Financial (Atlanta) at 5:00 p.m. Eastern time on December 3, 2017 (the “Agreed Time”), and the form of the press release and the Form 8-K announcing the terms of this Amendment existing as of the Agreed Time, shall be the agreed forms of such documents to be filed with the SEC (and in the case of the press release, issued publicly) and such documents shall not be revised or modified further (as to each of such documents, the “Agreed Forms”), and (ii) prior to 9:00 a.m. Eastern time on December 4, 2017, at substantially the same time, (a) the Company shall file the Proxy Statement with the SEC in the Agreed Form, (b) the Company, Parent and Merger Sub shall jointly file the Schedule 13E-3 with the SEC in the Agreed Form and (c) the Company shall issue a public press release and file a Form 8-K, both in the Agreed Forms, announcing the terms of this Amendment and Amendment No. 1 to the Rollover Agreement, dated as of even date herewith.
10. Miscellaneous Provisions.
(a) Definitions. Unless otherwise specifically defined in this Amendment, each capitalized or other defined term used herein without definition shall have the meaning assigned to such term in the Merger Agreement.
(b) No Further Amendment. Except as expressly amended hereby, the Merger Agreement is in all respects ratified and confirmed and all the terms, conditions, representations, warranties, covenants and provisions thereof shall remain in full force and effect in accordance with their respective terms. This Amendment is limited precisely as written and shall not be deemed to be an amendment to any other term or condition of the Merger Agreement or any of the documents referred to therein or the Company Disclosure Letter or the Parent Disclosure Letter or any of the documents referred to therein or otherwise affect or operate as a waiver or relinquishment of any of the rights of any party under any of them. Except as expressly amended hereby, this Amendment does not constitute a waiver of any condition or other provision of the Merger Agreement.
(c) Effect of Amendment. This Amendment shall form a part of the Merger Agreement for all purposes, and each party thereto and hereto shall be bound hereby. From and after the execution of this Amendment by the parties hereto, any reference to the Merger Agreement shall be deemed a reference to the Merger Agreement as amended hereby. The parties acknowledge and agree that the Company, on the one hand, and Parent and Merger Sub, on the other hand, shall be entitled to enforce Sections 8 and 9 of this Amendment as if such Sections were set forth in full in the Merger Agreement.
(d) Representations and Warranties of the Company. The Company represents and warrants to Parent and Merger Sub that (i) it has the corporate power and authority to execute and deliver this Amendment; (ii) the execution, delivery and performance by the Company of this Amendment have been duly and validly authorized by all necessary corporate action on the part of the Company, and no other corporate proceedings other than those previously taken or conducted on the part of the Company are necessary to approve and authorize this Amendment; and (iii) the Board of Directors of the Company has (A) determined
that it is in the best interests of the Company and its stakeholders to enter into this Amendment, (B) approved the execution, delivery and performance of this Amendment and the consummation of the transactions contemplated hereby, including the Merger, and (C) resolved to recommend adoption of the Merger Agreement, as amended, by the shareholders of the Company.
(e) Representations and Warranties of Parent and Merger Sub. Parent and Merger Sub represent and warrant to the Company that (i) each of Parent and Merger Sub has the organizational power and authority to execute and deliver this Amendment; (ii) the execution, delivery and performance by Parent and Merger Sub of this Amendment have been duly and validly authorized by all necessary organizational action on the part of each of Parent and Merger Sub, including approval and authorization of the Merger and the other transactions contemplated hereby by the Boards of Directors or comparable governing body of each of Parent and Merger Sub, and (iii) no other organizational proceedings other than those previously taken or conducted on the part of Parent and Merger Sub, as applicable, are necessary to approve and authorize this Amendment.
(f) Governing Law. This Amendment, including all matters of construction, validity and performance and any action or proceeding (whether in contract, tort, equity or otherwise) arising out of this Amendment or any of the transactions contemplated by this Amendment shall be governed by, and construed in accordance with, the laws of the State of Florida, without giving effect to the rules of conflict of laws of such State or other jurisdiction that would cause the application of the laws of any jurisdiction other than Florida.
(g) Severability. If any term or other provision of this Amendment is invalid, illegal or incapable of being enforced by virtue of any Law, or due to any public policy, all other conditions and provisions of this Amendment shall nevertheless remain in full force and effect.
(h) Counterparts. This Amendment may be executed by facsimile signatures and in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.
(i) Headings. The descriptive headings in this Amendment were formulated, used and inserted in this Amendment for convenience only and shall not be deemed to affect the meaning or construction of any of the provisions hereof.
(j) Other Miscellaneous Terms. The provisions of Article IX (General Provisions) of the Merger Agreement shall apply mutatis mutandis to this Amendment, and to the Merger Agreement as modified by this Amendment, taken together as a single agreement, reflecting the terms therein as modified hereby.
[Signature Page Follows]
Execution Version
IN WITNESS WHEREOF, Parent, Merger Sub, and the Company have caused this Amendment to be signed by their respective officers thereunto duly authorized, all as of the date first written above.
| OSTEON HOLDINGS, L.P. | ||
| By: | /s/ Michael LaGatta | |
| Name: | Michael LaGatta | |
| Title: | Vice President | |
| OSTEON MERGER SUB, INC. | ||
| By: | /s/ Michael LaGatta | |
| Name: | Michael LaGatta | |
| Title: | Vice President | |
| EXACTECH, INC. | ||
| By: | /s/ William Petty | |
| Name: | William Petty | |
| Title: | Executive Chairman | |
Exhibit 10.1
Execution Version
December 3, 2017
Osteon Holdings, L.P.
c/o TPG Global, LLC
301 Commerce Street
Suite 3300
Fort Worth, TX 76102
| Re: | First Amendment to Equity Commitment Letter |
Ladies and Gentlemen:
Reference is made to the letter agreement dated as of October 22, 2017 (the “Equity Commitment Letter”), among TPG Partners VII, L.P., a Delaware limited partnership (the “Fund”), Osteon Holdings, L.P., a Delaware limited partnership (“Parent”), and Exactech, Inc., a Florida corporation (the “Company”), which was executed and delivered in connection with the Agreement and Plan of Merger, dated as of October 22, 2017, as amended, by and among Parent, Osteon Merger Sub, Inc., a Florida corporation, and the Company.
The parties hereto hereby agree that the Equity Commitment Letter is amended as follows:
(a) Section 1 of the Equity Commitment Letter is hereby amended by deleting the number:
“$624,704,000”
and replacing such number with:
“$737,057,000”.
Except as expressly amended hereby, the Equity Commitment Letter is in all respects ratified and confirmed and all the terms, conditions, and provisions thereof shall remain in full force and effect. This first amendment to the Equity Commitment Letter (this “Amendment”) is limited precisely as written and shall not be deemed to be an amendment to any other term or condition of the Equity Commitment Letter or any of the documents referred to therein. This Amendment shall form a part of the Equity Commitment Letter for all purposes, and each party thereto and hereto shall be bound hereby. From and after the execution of this Amendment by the parties hereto, any reference to the Equity Commitment Letter shall be deemed a reference to the Equity Commitment Letter as amended hereby.
[Remainder of page intentionally left blank]
| Very truly yours, | ||||
| TPG PARTNERS VII, L.P. | ||||
| By: TPG Genpar VII, L.P., its general partner | ||||
| By: TPG Genpar VII Advisors, LLC, its general partner | ||||
| By: | /s/ Michael LaGatta | |||
| Name: | Michael LaGatta | |||
| Title: | Vice President | |||
Accepted and Agreed to as
of the date first written above:
| OSTEON HOLDINGS, L.P. | ||
| By: | /s/ Michael LaGatta | |
| Name: | Michael LaGatta | |
| Title: | Vice President | |
Accepted and Agreed to as
of the date first written above:
| EXACTECH, INC. | ||
| By: | /s/ William Petty | |
| Name: | William Petty | |
| Title: | Executive Chairman | |
Exhibit 99.1
Exactech and TPG Capital Announce Amended Merger Agreement Providing for Increase in Merger Consideration to $49.25 per share.
| • | Merger with TPG Capital Now Valued at $737 Million |
FOR IMMEDIATE RELEASE
Gainesville, Florida – December 4, 2017 – Exactech, Inc. (Nasdaq: EXAC), a leading developer and producer of orthopaedic implant devices and surgical instrumentation for extremities and large joints, announced today that it has entered into an amendment to its merger agreement with TPG Capital and certain of its affiliates which was previously announced on October 23, 2017. Pursuant to the amended merger agreement, the Company’s common stock outstanding immediately prior to the effective time of the merger (other than certain shares held by the Company’s founders and certain management shareholders) will be converted into the right to receive $49.25 per share in cash. This represents an increase of approximately 17.3% over the $42.00 of per share merger consideration previously agreed to by Exactech and TPG Capital. TPG Capital has also increased its equity financing commitment to $737 million for purposes of consummating the merger.
Pursuant to a rollover and voting support agreement entered into at the time of the amended merger agreement, the Company’s founders, CEO and certain other management shareholders have agreed with TPG to exchange a portion of their shares in the transaction, representing approximately 18.8% of the Company’s outstanding common stock, for new equity securities in the post-closing ownership of the Company at a valuation equal to or less than $49.25 per share. Such founding and management shareholders have previously agreed to vote all of their shares for the approval of the amended merger agreement.
Exactech’s Board has approved the amended merger agreement with TPG and has determined that it is advisable, fair to and in the best interests of Exactech and its shareholders. Exactech’s Board hereby recommends to Exactech’s shareholders that they vote to approve the merger agreement and the merger with TPG.
TPG has arranged fully committed equity financing for the transaction and there is no financing condition to consummation of the merger with the Company. Early termination of the statutory waiting period under the Hart-Scott-Rodino Act was obtained on November 17, 2017 and, accordingly, there are no anti-competition or other regulatory approvals needed to consummate the merger with TPG Capital’s affiliate. The merger is expected to close during the first quarter of 2018, subject to customary closing conditions.
Advisors
J.P. Morgan Securities LLC is acting as financial advisor to Exactech. Greenberg Traurig, P.A. (Miami) and Greenberg Traurig, LLP (NYC) are acting as Exactech’s legal advisor. Ropes & Gray LLP is acting as legal advisor to TPG Capital.
About Exactech
Exactech was founded in 1985 by orthopedic surgeon Dr. Bill Petty, his wife Betty and biochemical engineer Gary Miller, PhD, with the purpose of improving the quality of care for patients suffering from joint injury or disease, such as arthritis. The company employs more than 700 individuals including engineers, researchers, manufacturing professionals and sales representatives, and distributes its products to more than 35 countries around the world.
Based in Gainesville, Fla., Exactech develops and markets orthopaedic implant devices, related surgical instruments and biologic materials and services to hospitals and physicians. The company manufactures many of its orthopaedic devices at its Gainesville facility. Exactech’s orthopaedic products are used in the restoration of bones and joints that have deteriorated as a result of injury or diseases such as arthritis. Exactech markets its products in the United States, in addition to more than 30 markets in Europe, Latin America, Asia and the Pacific. Additional information about Exactech can be found at http://www.exac.com.
About TPG
TPG is a leading global alternative asset firm founded in 1992 with more than $73 billion of assets under management and offices in Austin, Beijing, Boston, Dallas, Fort Worth, Hong Kong, Houston, London, Luxembourg, Melbourne, Moscow, Mumbai, New York, San Francisco, Seoul, and Singapore. TPG’s investment platforms are across a wide range of asset classes, including private equity, growth venture, real estate, credit, and public equity. TPG aims to build dynamic products and options for its investors while also instituting discipline and operational excellence across the investment strategy and performance of its portfolio. For more information, visit www.tpg.com.
Media:
Luke Barrett
TPG
media@tpg.com
415-743-1550
Donna Edwards
352-377-1140
Donna.Edwards@exac.com
Forward-Looking Statements
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements include, but are not limited to, statements regarding Exactech’s proposed business combination transaction with TPG Capital, all statements regarding Exactech’s expected future financial position, results of operations, cash flows, dividends, financing plans, business strategy, budgets, capital expenditures, competitive positions, growth opportunities,
plans and objectives of management, and statements containing the words such as “anticipate,” “approximate,” “believe,” “plan,” “estimate,” “expect,” “project,” “could,” “would,” “should,” “will,” “intend,” “may,” “potential,” “upside,” and other similar expressions. All Statements in this press release that are not historical facts, are forward-looking statements that reflect the best judgment of Exactech based upon currently available information.
Such forward-looking statements are inherently uncertain, and shareholders and other potential investors must recognize that actual results may differ materially from Exactech’s expectations as a result of a variety of factors, including, without limitation, those discussed below. Such forward-looking statements are based upon management’s current expectations and include known and unknown risks, uncertainties and other factors, many of which Exactech is unable to predict or control, that may cause its actual results, performance or plans to differ materially from any future results, performance or plans expressed or implied by such forward-looking statements. These statements involve risks, uncertainties and other factors discussed below and detailed from time to time in Exactech’s filings with the Securities and Exchange Commission (the “SEC”).
Risks and uncertainties related to the proposed merger include, but are not limited to, the risk that Exactech’s shareholders do not approve the merger, potential adverse reactions or changes to business relationships resulting from the announcement of the amendment to the merger agreement or completion of the merger, uncertainties as to the timing of the merger, adverse effects on Exactech’s stock price resulting from the announcement of the merger or the failure of the merger to be completed, competitive responses to the announcement of the merger, the risk that regulatory, licensure or other approvals required for the consummation of the merger are not obtained or are obtained subject to terms and conditions that are not anticipated, litigation relating to the merger, the inability to retain key personnel, and any changes in general economic and/or industry-specific conditions.
In addition to the factors set forth above, other factors that may affect Exactech’s plans, results or stock price are set forth in its most recent Annual Report on Form 10-K and in its subsequently filed reports on Forms 10-Q and 8-K.
Many of these factors are beyond Exactech’s control. Exactech cautions investors that any forward-looking statements made by it are not guarantees of future performance. Exactech disclaims any obligation to update any such factors or to announce publicly the results of any revisions to any of the forward-looking statements to reflect future events or developments.
Additional Information and Where to Find It
All references below to the “merger”, the “proposed merger” or the “merger agreement” refer to the Company’s previously announced merger and merger agreement with TPG Capital, as amended or supplemented from time to time.
The Company previously filed with the SEC a report on Form 8-K regarding the proposed transaction with TPG Capital, which included the amendment to the merger agreement. All parties desiring details regarding the merger are urged to review these documents, which are available at the SEC’s website (http://www.sec.gov).
This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. This communication may be deemed to be solicitation material in respect of the proposed merger. In connection with the merger, the Company will prepare and mail a proxy statement to its shareholders. In addition, certain participants in the merger will prepare and file with the SEC a Schedule 13E-3 transaction statement. These documents will be filed with or furnished to the SEC. Investors and shareholders are urged to read carefully and in their entirety these materials and other materials filed with or furnished to the SEC when they become available, as they will contain important information about the Company, the merger and related matters. In addition to receiving the proxy statement by mail, shareholders also will be able to obtain these documents, as well as other filings containing information about the Company, the merger and related matters, without charge, from the SEC’s website (http://www.sec.gov). In addition, these documents can be obtained, without charge, by sending an e-mail to investors@exac.com, along with complete contact details and a mailing address.
Participants in Solicitation
The Company and certain of its directors, executive officers and other members of management and employees may, under SEC rules, be deemed to be “participants” in the solicitation of proxies from shareholders with respect to the merger. Information regarding the persons or entities who may be considered “participants” in the solicitation of proxies will be set forth in the proxy statement and Schedule 13E-3 transaction statement relating to the merger when it is filed with the SEC. Information regarding the directors and executive officers of the Company is set forth in the proxy statement for the Company’s 2017 Annual Meeting of Shareholders, which was filed with the SEC on March 24, 2017. Additional information regarding the interests of such potential participants will be included in the proxy statement and Schedule 13E-3 transaction statement and the other relevant documents filed with the SEC when they become available.
Exhibit 99.2
Execution Version
AMENDMENT NO. 1
TO THE
ROLLOVER AND VOTING AGREEMENT
This AMENDMENT NO. 1 (this “Amendment”) is made and entered into as of December 3, 2017, by and among OSTEON HOLDINGS, L.P., a Delaware limited partnership (“Parent”), on the one hand, and each of William Petty, M.D., Betty Petty, David W. Petty, Prima Investments, Limited Partnership, Miller Family Holdings, LLC, Bruce Thompson, Joel Phillips, Donna Edwards, Chris Roche and Steve Szabo (the “Shareholders”) on the other hand, to amend that certain ROLLOVER AND VOTING AGREEMENT, dated as of October 22, 2017, by and among Parent and each of William Petty, M.D., Betty Petty, David W. Petty, Prima Investments, Limited Partnership (as amended hereby, and as it may have been and may be further amended from time to time, the “Rollover and Voting Agreement”).
WHEREAS, Section 15(e) of the Rollover and Voting Agreement provides for the amendment of the Rollover and Voting Agreement in accordance with the terms set forth therein; and
WHEREAS, the parties hereto desire to amend the Rollover and Voting Agreement as set forth below and to add Miller Family Holdings, LLC, Bruce Thompson, Joel Phillips, Donna Edwards, Chris Roche and Steve Szabo as parties thereto.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements set forth herein and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound hereby, the parties hereto do hereby agree as follows:
1. Shareholders / Rollover Investors. Each of Miller Family Holdings, LLC, Bruce Thompson, Joel Phillips, Donna Edwards, Chris Roche and Steve Szabo hereby joins in and agrees to be a party to and bound by the Rollover and Voting Agreement as a “Shareholder” and as a “Rollover Investor” as of the date hereof, and the terms “Shareholder” and “Rollover Investor” in the Rollover and Voting Agreement shall be deemed to include each such person.
2. Amendment to Section 4(a). Section 4(a) of the Rollover and Voting Agreement is hereby amended by adding, immediately following the phrase “section 351 of the Code”, the phrase “in which the parties do not recognize any gain or income for U.S. Federal income tax purposes”.
3. Amendment to Section 4(b). Section 4(b) of the Rollover and Voting Agreement is hereby amended by deleting the following sentence: “The Parent Interests shall be the only class and series of securities authorized or issuable by Parent in connection with the Merger and the transactions related thereto, other than securities which are junior in all respects to the Parent Interests, and the rights of the Rollover Investors in and with respect to Parent will be pari passu with all other owners of Parent, including the Fund (as defined in the Merger Agreement), except as expressly set forth in the Shareholders’ Agreement.”
4. Amendment to Section 4(c). Section 4(c) of the Rollover and Voting Agreement is hereby amended to delete the existing text in its entirety and replace it with the following text:
“Parent Shareholders’ Agreement. The parties shall use their respective reasonable best efforts to negotiate and agreed on the form of a shareholders’ agreement of Parent to which each Rollover Investor will become a party (the “Parent Shareholders’ Agreement”) as promptly as reasonably practicable following December 1, 2017, with the intent that the Parent Shareholders’ Agreement shall be entered into and effective upon the Contribution Closing. If the parties have not entered into the Parent Shareholders’ Agreement by 30 calendar days following the Contribution Closing, then the parties shall submit (and, if Parent, on the one hand, or any Rollover Investor on the other hand, fails to join such submission, the other party may independently submit) any remaining unresolved or otherwise undecided terms of the proposed Parent Shareholders’ Agreement for decision and final resolution to binding arbitration to the exclusion of any courts of law, with such arbitration conducted by the American Arbitration Association in accordance with the then most current version of its commercial arbitration rules. The arbitrator(s) shall review the unresolved and undecided terms submitted for resolution and establish such terms based on Schedule A-3 and, to the extent not specified on Schedule A-3, what is customary in agreements and transactions of the type at issue and reasonable under the circumstances. The foregoing shall not prejudice any right of a party to seek an order compelling arbitration. Each Rollover Investor acknowledges and agrees that Parent shall not be required to pay the Merger Consideration to the Paying Agent in respect of such Rollover Investor’s Rollover Shares, but, for the avoidance of doubt, Parent shall be required at the Contribution Closing to issue to such Rollover Investor the Parent Interests set forth with respect to such Rollover Investor in Exhibit A-2.”
5. Amendment to Section 8. Section 8(f) of the Rollover and Voting Agreement is hereby amended to delete the existing text in its entirety and replace it with the following text: “The Fund is acquiring Class A common equity interests of Parent in connection with the Merger, and other than such equity interests, the Fund and its Affiliates will not directly or indirectly own any equity or debt securities (or rights, options or warrants to purchase any such equity or debt securities) of Parent or its Affiliates, including the Company, at Closing or otherwise in connection with the Merger.”
6. Amendment to Schedule A-1. Schedule A-1 of the Rollover and Voting Agreement is hereby replaced in its entirety by the following text:
Schedule A-1
Shareholders
| Name |
Subject Shares | Subject Options |
Address | |||||||
| William Petty, M.D. |
102,400 | 297,217 |
6717 NW 48th Lane Gainesville, FL 32653 | |||||||
| Betty Petty |
75,400 | 33,900 |
2735 NW 21st Street Gainesville, FL 32605 | |||||||
| David W. Petty |
65,622 | 104,150 |
6717 NW 48th Lane Gainesville, FL 32653 | |||||||
| Prima Investments, Limited Partnership |
3,080,271 | 0 |
6717 NW 48th Lane Gainesville, FL 32653 | |||||||
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| Name |
Subject Shares | Subject Options |
Address | |||||||
| Miller Family Holdings, LLC |
144,370 | 0 |
531 SW 26th Place Gainesville, FL 32601 | |||||||
| Bruce Thompson |
25,279 | 70,800 |
3522 SW 92nd Street Gainesville, FL 32608 | |||||||
| Joel Phillips |
115,654 | 133,000 |
6308 NW 81st Boulevard Gainesville, FL 32653 | |||||||
| Donna Edwards |
18,052 | 38,700 |
18130 NE 118th Way Lake Butler, FL 32054 | |||||||
| Chris Roche |
4,458 | 1,520 |
2163 SW 37th Court Gainesville, FL 32608 | |||||||
| Steve Szabo |
6,345 | 21,520 |
6427 NW 81 Blvd. Gainesville, FL 32653 | |||||||
| TOTAL |
3,637,851 | 700,807 | ||||||||
7. Amendment to Schedule A-2. Schedule A-2 of the Rollover and Voting Agreement is hereby replaced in its entirety by the following text:
Schedule A-2
Rollover Investors
| Name |
Rollover Shares |
Parent Interests* | ||||
| William Petty, M.D. |
102,400 | 5,821,546 shares of Class B Common | ||||
| Betty Petty |
75,400 | 3,713,450 shares of Class A Common | ||||
| David W. Petty |
50,000 | 2,462,500 shares of Class A Common | ||||
| Prima Investments, Limited Partnership |
2,300,000 | 130,757,376 shares of Class B Common | ||||
| Miller Family Holdings, LLC |
47,650 | 2,100,513 shares of Class A Common 284,255 shares of Class B Common | ||||
| Bruce Thompson |
25,279 | 998,741 shares of Class A Common 284,255 shares of Class B Common | ||||
| Joel Phillips |
82,000 | 3,546,000 shares of Class A Common 568,510 shares of Class B Common | ||||
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| Name |
Rollover Shares |
Parent Interests* | ||||
| Donna Edwards |
18,052 | 800,411 shares of Class A Common 102,332 shares of Class B Common | ||||
| Chris Roche |
4,458 | 219,557 shares of Class A Common | ||||
| Steve Szabo |
6,345 | 312,491 shares of Class A Common | ||||
| TOTAL |
2,711,584 | 14,153,663 shares of Class A Common 137,818,274 shares of Class B Common | ||||
| * | Parent’s charter will provide for the following: |
| Provision |
Terms | |
| Parent Interests | Rollover Investors will receive the number of shares of Class B Common Stock and Class A Common Stock of Parent specified in the table above in exchange for their Rollover Shares. The Fund will receive shares of Class A Common Stock of Parent in exchange for its equity contribution at a price of $1 per share.
| |
| Distributions | Step 1: Distributions will be made to the Class A Common and Class B Common, with the Class B Common receiving an amount that is pro rata based on the number of shares, but as if the number of outstanding Class B Common shares were divided by the Step 1 Distribution Ratio, until $2 has been distributed in the aggregate with respect to a single share of Class A Common.
Step 2: After Step 1, distributions will be made to the Class A Common and Class B Common, with the Class B Common receiving an amount that is pro rata based on the number of shares, but as if the number of outstanding Class B Common shares were divided by the Step 2 Distribution Ratio, until $3 has been distributed in the aggregate with respect to a single share of Class A Common.
Step 3: After Step 2, distributions will be made pro rata based on the number of shares to the Class A Common and Class B Common. |
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| Provision |
Terms | |
| “Step 1 Distribution Ratio” means the ratio of (A) the Aggregate Shareholder Class B Amount divided by (B) the Regular Rollover Amount.
“Step 2 Distribution Ratio” means the ratio of (A) the Aggregate Shareholder Class B Amount divided by (B) the sum of the Regular Rollover Amount and the 2x Option Rollover Amount.
“Aggregate Shareholder Class B Amount” means $137,818,274.
“2x Option Rollover Amount” means $73,705,697.
“3x Option Rollover Amount” means $18,426,424.
“Regular Rollover Amount” means $45,686,153.
The proceeds of liquidations or change-of-control transactions will be distributed according to the above distribution rules.
| ||
| Automatic Conversion | Immediately prior to an initial public offering, each share of Class B Common will automatically convert into (i) a number of shares of Class A Common equal to the IPO Class A Conversion Ratio, (ii) a number of warrants to purchase shares of Class A Common, at an exercise price of $2 per share (less all prior distributions on the Class A Common) and an exercise period of ten years, equal to the IPO $2 Warrant Conversion Ratio and (iii) a number of warrants to purchase shares of Class A Common, at an exercise price of $3 per share (less all prior distributions on the Class A Common) and an exercise period of ten years, equal to the IPO $3 Warrant Conversion Ratio. The warrants will be in customary form and contain customary terms and conditions, including cashless exercise provisions.
“IPO Class A Conversion Ratio” means the ratio of (A) the Regular Rollover Amount divided by (B) the Aggregate Shareholder Class B Amount.
“IPO $2 Warrant Conversion Ratio” means the ratio of (A) the 2x Option Rollover Amount divided by (B) the Aggregate Shareholder Class B Amount.
“IPO $3 Warrant Conversion Ratio” means the ratio of (A) the 3x Option Rollover Amount divided by (B) the Aggregate Shareholder Class B Amount. |
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| Provision |
Terms | |
| Voting | Each share of Class A Common and each share of Class B Common is entitled to one vote. The Class A Common and Class B Common vote together as a single class, other than with respect to amendments that would have a material, adverse and disproportionate effect on the holders of Class B Common relative to other Parent equityholders. |
8. Amendment to Schedule A-3. Schedule A-3 of the Rollover and Voting Agreement is hereby replaced in its entirety by the following text:
Schedule A-3
Terms of Parent Shareholders’ Agreement
| Provision |
Terms | |
| Tag-Along Rights | The Rollover Investors will have customary tag-along rights with respect to transfers by the Fund to prospective third party purchasers.
The Rollover Investors’ maximum tag-along percentage will be calculated on the basis of total number of shares of Class B Common owned as a proportion of all common stock then issued and outstanding. | |
| Drag-Along Rights | The Fund will have customary rights to drag the Rollover Investors in transfers of greater than 50% of the Fund’s equity interests in Parent to unaffiliated purchasers, with proceeds to be allocated as described in “Distributions” below.
The Rollover Investors waive any dissenters’ rights in connection with drag-along sales. In connection with tag-along or drag-along sales, Rollover Investors may be obligated to become liable for (i) customary individual representations as to title, authority and related matters with unlimited liability and (ii) customary representations and covenants of Parent, with liability capped at proceeds received. | |
| Pre-Emptive Rights | The Rollover Investors will have customary pro rata pre-emptive rights with respect to new equity issuances, subject to customary exceptions. | |
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| Provision |
Terms | |
| The Rollover Investors’ participation portion will be calculated on the basis of total number of shares of Class B Common owned as a proportion of all common stock then issued and outstanding. | ||
| Amendments | Majority consent of the Rollover Investors will be required for any amendment to the Parent Shareholders’ Agreement that has a material, adverse and disproportionate effect on the Rollover Investors relative to other Parent equityholders. | |
| Registration Rights | The Fund will have customary demand registration rights, including up to three demands for registration on Form S-1 and unlimited shelf registrations. The Rollover Investors will have customary piggyback registration rights as to all of their shares (and the shares underlying all warrants) and will be subject to customary lock-up arrangements, and will only be subject to customary cutbacks on a pro rata basis to the extent that the Fund is subject to such cutbacks. | |
| Transfer Restrictions | The Rollover Investors may not transfer their interests, other than pursuant to the tag-along or drag-along provisions, pursuant to customary estate planning provisions, transfers to affiliates, customary transfers for purposes of charitable contributions, or other customary permitted transfers.
The Fund may transfer its shares to affiliates and to any other person in compliance with the tag-along and drag-along provisions described above. | |
| Voting Agreement / Springing Proxy | The Rollover Investors agree to vote their shares in the same proportion as the Fund and its permitted assignees on director nominations, amendments increasing the number of authorized shares of common stock, drag along sales and recapitalization, merger, consolidation and similar corporate transactions.
The Rollover Investors grant the Fund a springing proxy to vote their shares in the event the Rollover Investors have not voted in accordance with such obligations. | |
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| Provision |
Terms | |
| Board Seats | The Rollover Investors will have the right to appoint a number of directors to Parent’s Board proportional to their ownership in Parent, but in any event not less than one. | |
| Negative Consents | The Rollover Investors, and any director designated by the Rollover Investors, will not have negative consent rights, except as described in “Affiliate Transactions” below and “Amendments” above. | |
| Affiliate Transactions | Unanimous Board consent shall be required to approve transactions between Parent and the Fund or its affiliates, other than (i) issuances of equity complying with the preemptive rights provisions, (ii) employment agreements with the Fund or its affiliates, (iii) a customary management agreement with the Fund or its affiliates and (iv) agreements on terms no more favorable than would have been obtainable on an arms-length basis in the ordinary course of business. | |
| D&O Indemnification | Parent will have customary indemnification obligations with respect to directors and officers and will obtain customary directors’ and officers’ insurance coverage. | |
| No Restrictive Covenants | The Parent Shareholders’ Agreement will not contain any non-competition arrangements with respect to the Rollover Investors. | |
| No Redemption Rights | The Parent Shareholders’ Agreement will not contain any redemption rights with respect to the Rollover Investors’ Parent Interests. For the avoidance of doubt, the Parent Shareholders’ Agreement may contain customary redemption rights with respect to issuance of any future incentive equity (not including Parent Interests issued to the Rollover Investors at the Contribution Closing). | |
| Charter | The charter and other governing documents of Parent will not contain any terms inconsistent with the terms of this Amendment, including the terms set forth in this Exhibit A-3. | |
9. Section 16. The Rollover and Voting Agreement is hereby amended to include the following text following Section 15 thereof as a new Section 16:
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“The parties agree that any conversion of the Class B Common shares into Class A Common shares and warrants to purchase Class A Common shares in connection with an initial public offering is intended to be treated as a tax-free reorganization under section 368(a) of the Code in which the parties do not recognize any gain or income for U.S. Federal income tax purposes. None of the Parent or the Shareholders, or any of their respective Affiliates, will take any Tax reporting position or any position in any Tax audit that is inconsistent with such intended tax treatment of the conversion transaction except upon a contrary final determination by an applicable Taxing authority.”
10. Miscellaneous Provisions.
(a) Definitions. Unless otherwise specifically defined in this Amendment, each capitalized or other defined term used herein without definition shall have the meaning assigned to such term in the Rollover and Voting Agreement.
(b) No Further Amendment. Except as expressly amended hereby, the Rollover and Voting Agreement is in all respects ratified and confirmed and all the terms, conditions, representations, warranties, covenants and provisions thereof shall remain in full force and effect in accordance with their respective terms. This Amendment is limited precisely as written and shall not be deemed to be an amendment to any other term or condition of the Rollover and Voting Agreement or any of the documents referred to therein or otherwise affect or operate as a waiver or relinquishment of any of the rights of any party under any of them. Except as expressly amended hereby, this Amendment does not constitute a waiver of any condition or other provision of the Rollover and Voting Agreement.
(c) Effect of Amendment. This Amendment shall form a part of the Rollover and Voting Agreement for all purposes, and each party thereto and hereto shall be bound hereby. From and after the execution of this Amendment by the parties hereto, any reference to the Rollover and Voting Agreement shall be deemed a reference to the Rollover and Voting Agreement as amended hereby.
(d) Representations and Warranties of Parent. Parent represents and warrants that (i) Parent has the organizational power and authority to execute and deliver this Amendment; (ii) the execution, delivery and performance by Parent of this Amendment have been duly and validly authorized by all necessary organizational action on the part of Parent, and (iii) no other organizational proceedings other than those previously taken or conducted on the part of Parent are necessary to approve and authorize this Amendment.
(e) Representations and Warranties of the Shareholders. Each Shareholder represents and warrants that it has full power and authority to make, enter into and carry out the terms of this Amendment.
(f) Governing Law. This Amendment, including all matters of construction, validity and performance and any action or proceeding (whether in contract, tort, equity or otherwise) arising out of this Amendment or any of the transactions contemplated by this Amendment shall be governed by, and construed in accordance with, the laws of the State of Florida, without giving effect to the rules of conflict of laws of such State or other jurisdiction that would cause the application of the laws of any jurisdiction other than Florida.
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(g) Severability. If any term or other provision of this Amendment is invalid, illegal or incapable of being enforced by virtue of any Law, or due to any public policy, all other conditions and provisions of this Amendment shall nevertheless remain in full force and effect.
(h) Counterparts. This Amendment may be executed by facsimile signatures and in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.
(i) Headings. The descriptive headings in this Amendment were formulated, used and inserted in this Amendment for convenience only and shall not be deemed to affect the meaning or construction of any of the provisions hereof.
(j) Other Miscellaneous Terms. The provisions of Section 15 (Miscellaneous) of the Rollover and Voting Agreement shall apply mutatis mutandis to this Amendment, and to the Rollover and Voting Agreement as modified by this Amendment, taken together as a single agreement, reflecting the terms therein as modified hereby.
[Signature Page Follows]
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IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the date first written above.
| OSTEON HOLDINGS, L.P. | ||||
| By: | /s/ Michael LaGatta | |||
| Name: | Michael LaGatta | |||
| Title: | Vice President | |||
| SHAREHOLDERS | ||||
| /s/ William Petty, M.D. | ||||
| William Petty, M.D. | ||||
| /s/ Betty Petty | ||||
| Betty Petty | ||||
| /s/ David W. Petty | ||||
| David W. Petty | ||||
| PRIMA INVESTMENTS, LIMITED PARTNERSHIP | ||||
| By: | /s/ William Petty | |||
| Name: | William Petty | |||
| Title: | President Prima Investments, Inc. General Partner | |||
[Signature Page to Amendment No. 1 to Voting and Rollover Agreement]
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IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the date first written above.
| SHAREHOLDERS | ||||
| /s/ Bruce Thompson | ||||
| Bruce Thompson | ||||
| /s/ Donna Edwards | ||||
| Donna Edwards | ||||
| /s/ Joel Phillips | ||||
| Joel Phillips | ||||
| /s/ Chris Roche | ||||
| Chris Roche | ||||
| /s/ Steve Szabo | ||||
| Steve Szabo | ||||
| MILLER FAMILY HOLDINGS, LLC | ||||
| By: | /s/ Gary J. Miller | |||
| Name: | Gary J. Miller | |||
| Title: | Managing Partner President MFH, Inc. | |||
[Signature Page to Amendment No. 1 to Voting and Rollover Agreement]
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