Item 1.01 Entry into a Material Definitive Agreement.
On June 3, 2009, NetApp, Inc., a Delaware corporation ("NetApp"), Data Domain,
Inc., a Delaware corporation ("Data Domain"), Kentucky Merger Sub One
Corporation, a Delaware corporation and a direct, wholly-owned subsidiary of
NetApp ("Merger Sub One"), and Derby Merger Sub Two LLC, a Delaware limited
liability company and a direct, wholly-owned subsidiary of NetApp ("Merger Sub
Two" and together with Merger Sub One, the "Merger Subs"), entered into
Amendment No. 1 (the "Amendment") to the Agreement and Plan of Merger, dated as
of May 20, 2009, by and among NetApp, Data Domain and the Merger Subs (as
amended, the "Merger Agreement"). Under the revised terms, the aggregate merger
consideration payable by NetApp to the Data Domain stockholders in connection
with the Merger (as defined in the Merger Agreement) has been increased from $25
per share to $30 per share, as described below.
As amended, upon the closing of the Merger, each outstanding share of Data
Domain common stock (other than those shares with respect to which appraisal
rights are properly exercised and not withdrawn) will be converted into the
right to receive (a) $16.45 per share in cash, without interest (the per share
amount of cash being referred to as the "Cash Consideration"), plus (b) a number
of validly issued, fully paid and non-assessable shares of NetApp common stock
equal to the following exchange ratio (the "Exchange Ratio"):
(i) 0.7783 shares of NetApp common stock if the Closing Average (as defined
below) is less than $17.41,
(ii) 0.6370 shares of NetApp common stock if the Closing Average is greater
than $21.27, and
(iii) that fraction of a share of NetApp common stock (rounded to the nearest
ten thousandth) equal to the quotient obtained by dividing $13.55 by the Closing
Average, if the Closing Average is (A) less than or equal to $21.27 and
(B) greater than or equal to $17.41 (the per share amount of stock referenced in
(i), (ii) or (iii) above, as applicable, being referred to as the "Stock
Consideration").
The "Closing Average" is defined as the average of the closing sales prices for
NetApp common stock, rounded to the nearest one-hundredth of a cent, on NASDAQ
for the ten most recent consecutive trading days ending on the third trading day
immediately prior to the closing of the Merger.
In the event that the Exchange Ratio is greater than or equal to 0.7006 and less
than 0.7783, NetApp, in its sole discretion, may (a) reduce the Stock
Consideration by such amount as NetApp may determine and (b) increase the Cash
Consideration by an amount equal to the product of (i) the amount of the such
reduction in the Stock Consideration multiplied by (ii) the Closing Average.
However, NetApp may not reduce the amount of the Stock Consideration and
increase the Cash Consideration to the extent that it would reasonably be
expected to cause the Merger to fail to qualify as a tax-free reorganization
under the Internal Revenue Code, except as may be required as described in the
paragraph below. The parties can make no assurances as to the tax-free status of
the transaction.
If the aggregate amount of the Stock Consideration issuable in the Merger
(including Stock Consideration issuable to holders of Data Domain options,
restricted stock and restricted shares) would exceed 19.5% of the outstanding
shares of NetApp common stock immediately prior to the closing of the Merger,
the Stock Consideration will be decreased to the minimum extent necessary so
that no more than 19.5% of the outstanding shares of NetApp common stock will be
issued in the Merger (with such percentage measured immediately prior to the
closing of the Merger). In such event, the Cash Consideration will be increased
by an amount equal to the product of (a) the amount of the reduction in the
Stock Consideration multiplied by (b) the Closing Average.
Other than as described above, the Merger Agreement, as filed on May 21, 2009 on
a Current Report on Form 8-K, remains in full force and effect as originally
executed on May 20, 2009. The foregoing description of the Amendment does not
purport to be complete and is qualified in its entirety by reference to the
Amendment, which is filed as Exhibit 2.1 hereto and incorporated into this
report by reference.
Item 8.01 Other Information.
On June 3, 2009, NetApp issued a press release relating to its offer to increase
the merger consideration payable by NetApp to the Data Domain stockholders in
connection with the Merger. A copy of the press release is attached hereto as
Exhibit 99.1. Later on the same day, NetApp and Data Domain issued a joint press
release announcing the execution of the Amendment by the parties. A copy of the
joint press release is attached hereto as Exhibit 99.3.
Additional Information and Where to Find It
NetApp plans to file with the SEC a Registration Statement on Form S-4 in
connection with the transaction and Data Domain plans to file with the SEC and
mail to its stockholders a Proxy Statement/Prospectus in connection with the
transaction. The Registration Statement and the Proxy Statement/Prospectus will
contain important information about NetApp, Data Domain, the transaction and
related matters. Investors and security holders are urged to read the
Registration Statement and the Proxy Statement/Prospectus carefully when they
are available. Investors and security holders will be able to obtain free copies
of the Registration Statement and the Proxy Statement/Prospectus and other
documents filed with the SEC by NetApp and Data Domain through the web site
maintained by the SEC at www.sec.gov and by contacting NetApp Investor Relations
at (408) 822-7098 or Data Domain Investor Relations at (408) 980-4909. In
addition, investors and security holders will be able to obtain free copies of
the documents filed with the SEC on NetApp's website at www.netapp.com and on
Data Domain's website at www.datadomain.com.
Participants in the Acquisition of Data Domain
NetApp, Data Domain and their respective directors, executive officers and
certain other members of management and employees may be deemed to be
participants in the solicitation of proxies in respect of the proposed
transaction. Information regarding these persons who may, under the rules of the
SEC, be considered participants in the solicitation of Data Domain stockholders
in connection with the proposed transaction will be set forth in the Proxy
Statement/Prospectus described above when it is filed with the SEC. Additional
information regarding NetApp's executive officers and directors is included in
NetApp's definitive proxy statement, which was filed with the SEC on July 14,
2008, and additional information regarding Data Domain's executive officers and
directors is included in Data Domain's Annual Report on Form 10-K/A for fiscal
year ended December 31, 2008, which was filed with the SEC on April 30, 2009.
You can obtain free copies of these documents from NetApp or Data Domain using
the contact information above.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit
Number Description
2.1 Amendment No. 1 to Agreement and Plan of Merger, dated as of June 3,
2009, by and among NetApp, Inc. and Data Domain, Inc., Kentucky Merger
Sub One Corporation, and Derby Merger Sub Two LLC.
99.1 Press Release by NetApp, Inc., dated June 3, 2009.
99.2 Offer Letter to the Board of Directors of Data Domain, Inc.
(Disseminated by NetApp as an attachment to the Press Release filed as
exhibit 99.1 hereto.)
99.3 Joint Press Release by NetApp, Inc. and Data Domain, Inc., dated June 3,
2009.
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