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BMC > SEC Filings for BMC > Form 8-K on 6-May-2013All Recent SEC Filings

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Form 8-K for BMC SOFTWARE INC


6-May-2013

Entry into a Material Definitive Agreement, Material Modification to Rights of S


Item 1.01. Entry into a Material Definitive Agreement.

Merger Agreement

On May 6, 2013, BMC Software, Inc. (the "Company") entered into an Agreement and Plan of Merger (the "Merger Agreement") with Boxer Parent Company Inc., a Delaware corporation ("Parent"), and Boxer Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of Parent ("Merger Sub"). Parent and Merger Sub were formed by Bain Capital Partners, LLC ("Bain Capital"), Golden Gate Private Equity, Inc. ("Golden Gate"), GIC Special Investments Pte Ltd ("GIC"), and Insight Venture Management, LLC ("Insight").

The Merger Agreement provides that, subject to the terms and conditions thereof, Merger Sub will be merged with and into the Company (the "Merger") with the Company continuing as the surviving corporation in the Merger, and, at the effective time of the Merger (the "Effective Time") each outstanding share of common stock of the Company (other than shares owned by the Company, Parent or Merger Sub, which shall be cancelled and retired) will cease to be outstanding and will be converted into the right to receive $46.25 in cash, without interest (the "Merger Consideration").

Pursuant to the Merger Agreement, as of the Effective Time, each stock option to purchase a share of the Company's common stock that is outstanding immediately prior to the Effective Time will become fully vested, and converted into the right to receive an amount in cash equal to the Merger Consideration, net of the exercise price. Each restricted stock unit award held by an employee at the level of Senior Vice President or above or by a member of the Board of Directors of the Company (the "Board") will vest fully as of the Effective Time with respect to the full number of shares subject to the restricted stock unit award and be converted into the right to receive an amount in cash equal to the Merger Consideration multiplied by the number of shares subject to the award, determined in the case of performance-based market stock units awards by assuming vesting at the target level. For each restricted stock unit award held by an employee below the level of Senior Vice President, the portion of the award that is scheduled to vest on or prior to the first anniversary of the Effective Time will vest at the Effective Time and be converted into the right to receive an amount in cash equal to the Merger Consideration multiplied by the number of shares subject to such portion of the award. The portion of the award that is scheduled to vest after the first anniversary of the Effective Time will be converted into an award (a "Converted Award") representing a right to receive an amount in cash equal to the Merger Consideration multiplied by the number of shares subject to that portion of the award. Each Converted Award will continue to vest and be settled in cash in accordance with the terms of the original award, except that (1) instead of the original vesting date, each portion of a Converted Award will instead vest on the date that is one year prior to the vesting date specified in the applicable award agreement, and (2) the vesting of the Converted Award will accelerate fully if an award holder's employment is terminated without cause or in other circumstances entitling the award holder to severance benefits.

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The Board has approved, and declared to be advisable, the Merger Agreement and the transactions contemplated thereby, including the Merger. Stockholders of the Company will be asked to vote on the adoption of the Merger Agreement at a special stockholders meeting that will be held on a date to be announced. The closing of the Merger is subject to the adoption of the Merger Agreement by the affirmative vote of the holders of at least a majority of all outstanding shares of common stock of the Company (the "Company Stockholder Approval"). Consummation of the Merger is not subject to a financing condition, but is subject to a condition that the Company have a specified amount of cash available in the United States on the date of closing (the "Cash Condition"). In addition to the Company Stockholder Approval condition and the Cash Condition, consummation of the Merger is also subject to various customary conditions, including the expiration of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, approvals or expirations of applicable waiting periods under antitrust laws in certain non-U.S. jurisdictions, receipt of written notification issued by the Committee on Foreign Investment in the United States that it has determined not to conduct a full investigation of the transaction, or that the U.S. government will not take actions to prevent the transaction if an investigation is required, the absence of any governmental order prohibiting the consummation of the transactions contemplated by the Merger Agreement, the accuracy of the representations and warranties contained in the Merger Agreement (subject to certain materiality qualifiers) and compliance with covenants and agreements in the Merger Agreement in all material respects.

The Company has made customary representations, warranties and covenants in the Merger Agreement, including, among others, covenants (1) to conduct its business in the ordinary course during the period between the execution of the Merger Agreement and the Effective Time, (2) not to engage in certain types of transactions during this period unless agreed to in writing by Parent, (3) to convene and hold a meeting of its stockholders for the purpose of obtaining the Company Stockholder Approval and (4) subject to certain exceptions, not to withhold, withdraw or modify in a manner adverse to Parent the recommendation of the Board that the Company's stockholders approve the adoption of the Merger Agreement.

The Merger Agreement provides that, during the period beginning on the date of the Merger Agreement and continuing until 11:59 p.m. (New York time) on June 5, 2013 (the "Go-Shop Period End Date"), the Company and its subsidiaries and their respective representatives may solicit, initiate and encourage any alternative acquisition proposals from third parties, provide nonpublic information to such third parties (subject to entry into an acceptable confidentiality agreement) and participate in discussions and negotiations with such third parties regarding alternative acquisition proposals. Beginning on the Go-Shop Period End Date, the Company will become subject to customary "no shop" restrictions prohibiting the Company, its subsidiaries, and its and their respective representatives from soliciting alternative acquisition proposals from third parties or providing information to or participating in discussions or negotiations with third parties regarding alternative acquisition proposals. However, until the tenth day following the Go Shop Period End Date (the "Cut-off . . .



Item 3.03 Material Modification to Rights of Security Holders.

See the description set forth under "Item 1.01-Entry into a Material Definitive Agreement," which is incorporated by reference into this Item 3.03.



Item 8.01. Other Events.

On May 6, 2013, the Company issued a press release announcing the execution of the Merger Agreement. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.

Also on May 6, 2013, the Company issued various communications to employees and held an all-employee call concerning the proposed Merger. Copies of those communications are filed as exhibits to this report. These communications are attached hereto as Exhibits 99.2, 99.3, 99.4 and 99.5 and are incorporated by reference herein.

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Item 9.01. Financial Statements, Pro Forma Financial Information and Exhibits

(d) Exhibits. The following exhibits are filed as part of this report:

2.1*     Agreement and Plan of Merger, dated as of May 6, 2013, by and among Boxer
         Parent Company Inc., Boxer Merger Sub Inc. and BMC Software, Inc.

4.1      Amendment No. 1, dated as of May 4, 2013 to the Rights Agreement, dated
         as of May 12, 2012, between the Company and Computershare Trust Company,
         N.A., as Rights Agent

10.1     Voting Agreement, dated as of May 4, 2013, by and among Boxer Parent
         Company Inc., BMC Software, Inc., Elliott Associates, L.P. and Elliott
         International, L.P.

10.2     Amendment No. 1, dated as of May 6, 2013, to the Credit Agreement dated
         as of November 21, 2012, among BMC Software, Inc., Bank of America, N.A.,
         as administrative agent and sole lender

99.1     Press Release, dated May 6, 2013

99.2     Letter to Employees, dated May 6, 2013

99.3     Employee FAQ, dated May 6, 2013

99.4     Leader Talking Points, dated May 6, 2013

99.5     Employee Call Transcript, dated May 6, 2013

* Schedules and exhibits omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company agrees to furnish supplementally a copy of any omitted schedule to the Securities and Exchange Commission upon request.

Additional Information and Where to Find It

In connection with the proposed transaction, the Company will file with the Securities and Exchange Commission (the "SEC") and furnish to the Company's stockholders a proxy statement. BEFORE MAKING ANY VOTING DECISION, THE COMPANY'S STOCKHOLDERS ARE URGED TO READ THE PROXY STATEMENT IN ITS ENTIRETY WHEN IT BECOMES AVAILABLE AND ANY OTHER DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED MERGER OR INCORPORATED BY REFERENCE IN THE PROXY STATEMENT BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION AND THE PARTIES TO THE PROPOSED TRANSACTION. Investors and security holders may obtain a free copy of documents filed by BMC Software, Inc. with the SEC at the SEC's website at http://www.sec.gov. In addition, investors and security holders may obtain a free copy of BMC Software, Inc.'s filings with the SEC from BMC Software, Inc.'s website at http://investors.bmc.com/sec.cfm or by directing a request to: BMC Software, Inc., 2101 CityWest Blvd., Houston, Texas 77042-2827, Attn: Investor Relations, (713) 918-1805.

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The Company and certain of its directors, executive officers, and certain other members of management and employees of the Company may be deemed to be participants in the solicitation of proxies from stockholders of the Company in favor of the proposed merger. Information about the directors and executive officers of the Company is set forth in the proxy statement for the Company's 2012 annual meeting of stockholders, as filed with the SEC on Schedule 14A on June 5, 2012 (as amended by the proxy statement supplement filed on July 3, 2012). Additional information regarding the interests of these individuals and other persons who may be deemed to be participants in the solicitation will be included in the proxy statement the Company will file with the SEC.

Forward-Looking Statements

Statements about the expected timing, completion and effects of the proposed transaction and all other statements in this report and the exhibits furnished or filed herewith, other than historical facts, constitute forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on these forward-looking statements and any such forward-looking statements are qualified in their entirety by reference to the following cautionary statements. All forward-looking statements speak only as of the date hereof and are based on current expectations and involve a number of assumptions, risks and uncertainties that could cause the actual results to differ materially from such forward-looking statements. The Company may not be able to complete the proposed transaction on the terms described above or other acceptable terms or at all because of a number of factors, including (1) the occurrence of any event, change or other circumstances that could give rise to the termination of the Merger Agreement, (2) the failure to obtain stockholder approval or the failure to satisfy the closing conditions, (3) the failure to obtain the necessary financing arrangements set forth in the debt and equity commitment letters delivered pursuant to the Merger Agreement, (4) risks related to disruption of management's attention from the Company's ongoing business operations due to the transaction and (5) the effect of the announcement of the Merger on the ability of the Company to retain and hire key personnel and maintain relationships with its customers, suppliers, operating results and business generally.

Actual results may differ materially from those indicated by such forward-looking statements. In addition, the forward-looking statements represent the Company's views as of the date on which such statements were made. The Company anticipates that subsequent events and developments may cause its views to change. However, although the Company may elect to update these forward-looking statements at some point in the future, it specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Company's views as of any date subsequent to the date hereof. Additional factors that may affect the business or financial results of the Company are described in the risk factors included in the Company's filings with the SEC, including the Company's 2012 Annual Report on Form 10-K and later filed quarterly reports on Form 10-Q and Current Reports on Form 8-K, which factors are incorporated herein by reference. The Company expressly disclaims a duty to provide updates to forward-looking statements, whether as a result of new information, future events or other occurrences.

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