We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Share Name | Share Symbol | Market | Type |
---|---|---|---|
NIC Inc | NASDAQ:EGOV | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 34.00 | 33.93 | 34.00 | 0 | 01:00:00 |
☐
|
Preliminary Proxy Statement
|
☐
|
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
|
☒
|
Definitive Proxy Statement
|
☐
|
Definitive Additional Materials
|
☐
|
Soliciting Material Pursuant to §240.14a-12
|
NIC INC.
|
(Name of Registrant as Specified in Its Charter)
|
|
(Name of Person(s) Filing Proxy Statement if other than Registrant)
|
1.
|
to adopt the Agreement and Plan of Merger, dated as of February 9, 2021, as may be amended from time to time (which we refer to as the “merger agreement”), by and among NIC, Tyler Technologies, Inc. (which we refer to as “Tyler”) and Topos Acquisition, Inc. (which we refer to as “Merger Sub”), pursuant to which Merger Sub will merge with and into NIC (which we refer to as the “merger”), and NIC will continue as the surviving corporation and a wholly-owned subsidiary of Tyler;
|
2.
|
to approve, on a non-binding advisory basis, specified compensation that may be paid or become payable to NIC’s named executive officers in connection with the merger and contemplated by the merger agreement (which we refer to as the “compensation advisory proposal”); and
|
3.
|
to approve one or more adjournments of the Special Meeting, if necessary or appropriate, to solicit additional proxies if there are insufficient votes at the time of the Special Meeting to constitute a quorum or to approve the proposal to adopt the merger agreement (which we refer to as the “adjournment proposal”).
|
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| | ||
| |
| | ||
| | ||
| |
•
|
via the Special Meeting website;
|
•
|
via the Internet, at the Internet address provided on the proxy card;
|
•
|
by telephone, by using the toll-free number listed on the proxy card; or
|
•
|
by mail, by completing, signing and dating the proxy card and returning it in the enclosed postage-paid envelope.
|
•
|
NIC stockholder approval—the adoption of the merger agreement by the affirmative vote of the holders of at least a majority of the outstanding shares of NIC common stock entitled to vote thereon;
|
•
|
Government Consents—the expiration or termination of the waiting period (or extensions thereof) under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (which we refer to as the “HSR Act”) relating to the merger;
|
•
|
No Injunctions or Restraints—the absence of any restraint (as defined in the section entitled “The Merger (Proposal 1)— Conditions to the Merger” beginning on page 75 of this proxy statement) or law that has the effect of enjoining, making it illegal or otherwise prohibiting the completion of the merger;
|
•
|
Accuracy of Representations and Warranties—the accuracy of the representations and warranties of NIC, on the one hand, and Tyler and Merger Sub, on the other hand, in the merger agreement, subject in some instances to materiality, “material adverse effect” (as defined in the section entitled “The Merger Agreement—Material Adverse Effect” beginning on page 63 of this proxy statement) or other qualifiers, as of February 9, 2021 and as of the closing date; and
|
•
|
Compliance with Covenants—the performance of or compliance with, in all material respects, by NIC, on the one hand, and Tyler and Merger Sub, on the other hand, of their respective obligations, covenants and agreements required to be performed or complied with by them under the merger agreement by the time of the closing.
|
•
|
solicit, initiate or knowingly encourage or knowingly facilitate (including by way of providing information) any inquiry with respect to, or the making, submission or announcement of, an acquisition proposal (as defined in the section entitled “The Merger Agreement—No Solicitation of Other Offers by NIC” beginning on page 68 of this proxy statement) or any inquiry, proposal or offer that would reasonably be expected to lead to an acquisition proposal;
|
•
|
participate in any negotiations regarding, or furnish to any person any information relating to NIC or any of its subsidiaries in connection with, an acquisition proposal or any inquiry, proposal or offer that would reasonably be expected to lead to an acquisition proposal;
|
•
|
adopt, approve, endorse or recommend, or publicly propose to adopt, approve, endorse or recommend, any acquisition proposal;
|
•
|
withdraw, change, amend, modify or qualify, or otherwise publicly propose to withdraw, change, amend, modify or qualify, in each case, in a manner adverse to Tyler, the NIC board recommendation (as defined in the section entitled “The Special Meeting—The NIC Board of Directors’ Recommendation” beginning on page 26 of this proxy statement);
|
•
|
fail to include the NIC board recommendation in this proxy statement;
|
•
|
approve, authorize, or cause or permit NIC or any of its subsidiaries to enter into, any merger agreement, acquisition agreement, reorganization agreement, letter of intent, memorandum of understanding, agreement in principle or similar definitive agreement with respect to, or any other definitive agreement or commitment providing for, any acquisition proposal (other than certain confidentiality agreements); or
|
•
|
call or convene a meeting of NIC stockholders to consider a proposal that would reasonably be expected to materially impair, prevent or delay the consummation of the transactions contemplated by the merger agreement.
|
•
|
the NIC board of directors may make a change of recommendation (but may not terminate the merger agreement) in response to an intervening event (as defined in the section entitled “The Merger Agreement—Change of Recommendation; Match Rights”) if the NIC board of directors has determined in good faith, after consultation with NIC’s outside legal counsel, that the failure to take such action would be reasonably likely to be inconsistent with the directors’ fiduciary duties under applicable law; or
|
•
|
the NIC board of directors may make a change of recommendation and cause NIC to terminate the merger agreement in order to enter into a definitive agreement providing for an unsolicited acquisition proposal received after the date of the merger agreement that did not result from a breach of NIC’s non-solicitation obligations and such acquisition proposal is not withdrawn (subject to payment by NIC to Tyler of the termination fee described under the section entitled “The Merger Agreement—Termination Fee”), if the NIC board of directors has determined in good faith after consultation with NIC’s outside legal counsel and financial advisors that such acquisition proposal constitutes a superior proposal.
|
•
|
by mutual written consent of NIC and Tyler; or
|
•
|
by either NIC or Tyler, if:
|
–
|
the closing has not occurred on or before June 30, 2021 (which we refer to as the “outside date”) except that if, on the outside date, all of the conditions to closing, other than certain conditions related to the expiration or termination, as applicable, of the waiting period (or extensions thereof) under the HSR Act, the absence of any restraint or other legal prohibition on the consummation of the merger (to the extent any such restraint is in respect of, or any such law is, the HSR Act) and those conditions that by their nature are to be satisfied at closing (but provided that such conditions shall then be capable of being satisfied if the closing were to take place on such date), have been satisfied or waived, then the outside date will automatically be extended one time for an additional three months. This right to terminate the merger agreement will not be available to any party whose action or failure to fulfill any obligation under the merger agreement has been a proximate cause of the failure of the transactions to be consummated by the outside date, and such action or failure to act constitutes a material breach of the merger agreement;
|
–
|
any restraint enjoining or otherwise prohibiting the consummation of the merger has become final and nonappealable and remains in effect. This right to terminate the merger agreement will not be available to any party whose action or failure to fulfill its obligations under the merger agreement has been a proximate cause of such restraint or of such restraint becoming final and nonappealable; or
|
–
|
the NIC stockholder approval has not been obtained by the affirmative vote of the holders of at least a majority of the outstanding shares of NIC common stock entitled to vote thereon at the Special Meeting (or any adjournment or postponement thereof).
|
–
|
the NIC board of directors effects a change of recommendation and NIC substantially concurrently enters into a definitive agreement providing for a superior proposal, as long as (1) NIC has complied in all material respects with its obligations not to solicit, participate in negotiations with respect to, or furnish certain information in connection with, any acquisition proposal or potential acquisition proposal, as further described under the section entitled “The Merger Agreement—No Solicitation of Other Offers by NIC”, and (2) substantially concurrently with or prior to (and as a condition to) such termination, NIC pays to Tyler the $55 million termination fee described below; or
|
–
|
a Tyler breach termination event (as defined in the section entitled “The Merger Agreement—Termination of the Merger Agreement—Termination by NIC”) has occurred.
|
–
|
prior to receipt of the NIC stockholder approval, the NIC board of directors has effected a change of recommendation or NIC has willfully and materially breached its obligations described under the sections entitled “The Merger Agreement—No Solicitation of Other Offers by NIC”; or
|
–
|
an NIC breach termination event (as defined in the section entitled “The Merger Agreement—Termination of the Merger Agreement—Termination by Tyler”) has occurred.
|
•
|
(1) NIC or Tyler terminates the merger agreement as a result of the closing having not occurred on or before the outside date or the NIC stockholder approval having not been obtained; (2) after the date of the merger agreement and prior to the date of the termination (or prior to the receipt of the NIC stockholder approval in the case of a termination as a result of the NIC stockholder approval having not been obtained), a bona fide acquisition proposal has been publicly disclosed and is not publicly withdrawn at least three business days prior to the earlier of the Special Meeting and the date of such termination; and (3) within 12 months of such termination, an acquisition proposal is consummated or a definitive agreement providing for an acquisition proposal is entered into, in which case NIC is required to pay such termination fee to Tyler on or prior to the date such acquisition proposal is consummated;
|
•
|
Tyler terminates the merger agreement because the NIC board of directors has effected a change of recommendation or NIC has willfully breached its obligations described under the section entitled “The Merger Agreement—No Solicitation of Other Offers by NIC”; or
|
•
|
NIC terminates the merger agreement in order to enter into a definitive agreement providing for a superior proposal.
|
•
|
an injunction or injunctions to prevent or remedy any breaches or threatened breaches of the merger agreement;
|
•
|
a decree or order of specific performance specifically enforcing the terms and provisions of the merger agreement; and
|
•
|
any further equitable relief, in each case, in addition to any other remedy to which a party is entitled at law or in equity, in each case without the obligation to obtain, furnish or post any bond or similar instrument.
|
Q:
|
Why am I receiving this proxy statement?
|
A:
|
You are receiving this proxy statement because, on February 9, 2021, NIC entered into the merger agreement providing for the merger of Merger Sub with and into NIC, with NIC surviving the merger as a wholly-owned subsidiary of Tyler, and your vote is required in connection with the merger. You are receiving this proxy statement in connection with the solicitation of proxies by the NIC board of directors “FOR” the proposal to adopt the merger agreement and to approve the other proposals to be voted on at the Special Meeting.
|
Q:
|
What is a proxy?
|
A:
|
A proxy is your legal designation of another person, referred to as a “proxy,” to vote your shares of NIC common stock. The written document describing the matters to be considered and voted on at the Special Meeting is called a “proxy statement.” The document used to designate a proxy to vote your shares of NIC common stock is called a “form of proxy” or “proxy card.” The NIC board of directors has designated each of Harry H. Herington, Chairman of the NIC board of directors and Chief Executive Officer, and Stephen M. Kovzan, Chief Financial Officer, with full power of substitution, as proxy for the Special Meeting.
|
Q:
|
What is the proposed transaction?
|
A:
|
The proposed transaction is the acquisition of NIC by Tyler through the merger of Merger Sub with and into NIC pursuant to the merger agreement. Following the effective time, NIC will be privately held as a wholly-owned subsidiary of Tyler, and you will no longer own shares of NIC common stock and instead will have only the right to receive the merger consideration. Following the consummation of the merger, NIC common stock will be de-listed from Nasdaq and de-registered under the Exchange Act; thus, NIC will no longer be a public company.
|
Q:
|
What will I receive in the merger?
|
A:
|
If the merger is consummated, you will be entitled to receive $34.00 in cash for each share of NIC common stock you own, without interest and less applicable withholding taxes. For example, if you own 100 shares of NIC common stock, you will be entitled to receive $3,400.00 in cash, without interest and less applicable withholding taxes. After the effective time, you will no longer have any rights as an NIC stockholder, other than the right to receive the merger consideration.
|
Q:
|
What is included in these materials?
|
A:
|
These materials include:
|
•
|
this proxy statement for the Special Meeting;
|
•
|
a proxy card or voting instruction form (enclosed with this proxy statement);
|
•
|
a copy of the merger agreement (attached as Annex A to this proxy statement);
|
•
|
the written opinion of Cowen (attached as Annex B to this proxy statement); and
|
•
|
the full text of Section 262 of the DGCL (attached as Annex C to this proxy statement).
|
Q:
|
Where and when is the Special Meeting?
|
A:
|
The Special Meeting will be held virtually via the Internet at 11:00 a.m. Central Time on April 19, 2021. As part of our precautions regarding the COVID-19 (coronavirus) pandemic, we are sensitive to the public health and travel concerns that our stockholders may have, as well as any quarantines or other protocols that governments may impose. As a result, the Special Meeting will be held solely via live webcast and there will not be a physical
|
Q:
|
How do I attend the Special Meeting?
|
A:
|
You will be able to attend the Special Meeting online and vote your shares electronically by visiting the Special Meeting website. If you plan to attend the Special Meeting, you will need the 16-digit control number included on your proxy card or voting instruction form that is accompanied by your proxy materials. During the Special Meeting, NIC stockholders will be able to vote their shares of NIC common stock. Shares previously voted at the Special Meeting do not need to be voted again unless you intend to change or revoke your prior vote.
|
Q:
|
What proposals will be voted on at the Special Meeting?
|
A:
|
There are three proposals scheduled to be voted on at the Special Meeting:
|
•
|
to adopt the merger agreement;
|
•
|
to approve, on a non-binding advisory basis, specified compensation that may be paid or become payable to NIC’s named executive officers in connection with the merger and contemplated by the merger agreement; and
|
•
|
to approve one or more adjournments of the Special Meeting, if necessary or appropriate, to solicit additional proxies if there are insufficient votes at the time of the Special Meeting to constitute a quorum or to approve the proposal to adopt the merger agreement.
|
Q:
|
What is the NIC board of directors’ voting recommendation?
|
A:
|
Upon consideration, the NIC board of directors unanimously recommends that you vote your shares:
|
•
|
“FOR” the proposal to adopt the merger agreement;
|
•
|
“FOR” the compensation advisory proposal; and
|
•
|
“FOR” the adjournment proposal.
|
Q:
|
Who is entitled to vote at the Special Meeting?
|
A:
|
All shares of NIC common stock owned by you as of the record date, which is the close of business on March 16, 2021, may be voted by you. You may cast one vote per share of NIC common stock that you held on the record date. These shares include shares that are:
|
•
|
held directly in your name as the stockholder of record; and
|
•
|
held through a broker, bank or other nominee for you as the beneficial owner, including those shares over which a broker, bank or other nominees has provided you with a specific control number further instructions and allowing you to vote those shares via the Special Meeting website.
|
Q:
|
What is the difference between holding shares as a “stockholder of record” and as a “beneficial owner”?
|
A:
|
Our stockholders may hold their shares through a broker, bank or other nominee rather than directly in their own name. As summarized below, there are some differences between shares held of record and those owned beneficially.
|
•
|
Stockholder of Record. If your shares of NIC common stock are registered directly in your name with NIC’s transfer agent, Computershare, Inc., you are considered, with respect to those shares, the stockholder of record, and this proxy statement was sent directly to you by NIC. As the stockholder of record, you have the right to vote via the Special Meeting website, grant your voting proxy directly to certain officers of NIC or to appoint a representative of your choosing to attend the Special Meeting and vote on your behalf by granting such person a “legal proxy.”
|
•
|
Beneficial Owner. If your shares of NIC common stock are held in an account at a broker, bank or other nominee, you are considered the beneficial owner of shares held in street name, and this proxy statement was forwarded to you by your broker, bank or other nominee, who is considered, with respect to those shares, to be the “stockholder of record.” As the beneficial owner, you have the right to direct your broker, bank or other nominee how to vote your shares on your behalf at the Special Meeting, or you may contact your broker, bank or other nominee to obtain your specific control number and further instructions. Because you are not the “stockholder of record,” you may not vote your shares via the Special Meeting website, unless you request and obtain your specific control number from your broker, bank or other nominee.
|
Q:
|
What must I do if I want to attend the Special Meeting?
|
A:
|
Only individuals who were NIC stockholders as of the close of business on the record date and their authorized representatives may attend the Special Meeting. If you plan to attend the Special Meeting, you will need the 16-digit control number included on your proxy card or voting instruction form that is accompanied by your proxy materials. During the Special Meeting, NIC stockholders will be able to vote their shares of NIC common stock. If you are a beneficial owner of shares held in street name and wish to vote at the Special Meeting, you should contact your broker, bank or other nominee to obtain your specific control number and further instructions. To ensure that you will be represented, even if you plan to attend the Special Meeting via the Special Meeting website, we encourage you to promptly vote by submitting the enclosed proxy card in the accompanying prepaid reply envelope or grant your proxy electronically over the Internet or by telephone. If you attend the Special Meeting and vote by ballot via the Special Meeting website, your vote will revoke any proxy that you have previously submitted. Please contact your broker, bank or other nominee for instructions regarding obtaining your specific control number and further instructions.
|
Q:
|
If I am a stockholder of record of shares of NIC common stock, how do I vote?
|
A:
|
If you are a stockholder of record, there are four ways you can vote:
|
•
|
via the Special Meeting website;
|
•
|
via the Internet, at the Internet address provided on the proxy card;
|
•
|
by telephone, by using the toll-free number listed on the proxy card; or
|
•
|
by mail, by completing, signing and dating the proxy card and returning it in the enclosed postage-paid envelope.
|
Q:
|
If I am a beneficial owner of shares of NIC common stock held in street name, how do I vote?
|
A:
|
If you are a beneficial owner of shares of NIC common stock held in street name, you will receive instructions from your broker, bank or other nominee as to how to vote your shares. You must follow the instructions of your broker, bank or other nominee in order for your shares to be voted. Telephone and Internet voting also will be offered to stockholders owning shares through certain brokers, banks and other nominees. If your shares are not registered in your own name but are held through your broker, bank or other nominee and you plan to vote your shares via the Special Meeting website, you should contact your broker, bank or other nominee to obtain your specific control number and further instructions. Please note that if you hold your shares through a broker, bank or other nominee, such nominee cannot vote your shares unless you have given your nominee specific instructions as to how to vote. In order for your vote to be counted, please make sure that you submit your vote to your broker, bank or other nominee.
|
Q:
|
Will my shares of NIC common stock held in street name or another form of record ownership be combined for voting purposes with shares I hold of record?
|
A:
|
No. Because any shares of NIC common stock you may hold in street name will be deemed to be held by a different stockholder of record than any shares of NIC common stock you hold of record, any shares of NIC common stock held in street name will not be combined for voting purposes with shares of NIC common stock you hold of record. Similarly, if you own shares of NIC common stock in various registered forms, such as jointly with your spouse, as trustee of a trust or as custodian for a minor, you will receive, and will need to sign and return, a separate proxy card or vote separately by telephone or Internet with respect to those shares of NIC common stock because they are held in a different form of record ownership. Shares of NIC common stock held by a corporation or business entity must be voted by an authorized officer of the entity. Shares of NIC common stock held in an individual retirement account must be voted under the rules governing such account.
|
Q:
|
What is the quorum requirement for the Special Meeting?
|
A:
|
A quorum is necessary to hold a valid meeting of NIC stockholders. The holders of a majority of the shares entitled to vote, present at the Special Meeting via the Special Meeting website or represented by proxy, at the close of business on the record date will constitute a quorum at the Special Meeting. If a quorum is not present at the Special Meeting, the Special Meeting may be adjourned or postponed from time to time until a quorum is obtained.
|
Q:
|
What happens if I do not give specific voting instructions?
|
A:
|
Stockholder of Record. If you are a stockholder of record and you submit a signed proxy card or submit your proxy by telephone or the Internet, but do not specify how you want to vote your shares on a particular proposal, then the proxy holders will vote your shares in accordance with the recommendations of the NIC board of directors on all matters presented in this proxy statement. Thus, your shares of NIC common stock will be voted:
|
•
|
“FOR” the proposal to adopt the merger agreement;
|
•
|
“FOR” the compensation advisory proposal; and
|
•
|
“FOR” the adjournment proposal.
|
Q:
|
What is the voting requirement to approve the proposal to adopt the merger agreement?
|
A:
|
The adoption of the merger agreement requires stockholders holding a majority of the issued and outstanding shares of NIC common stock entitled to vote thereon, to vote “FOR” the proposal to adopt the merger agreement. A failure to vote your shares of NIC common stock or an abstention from voting on this proposal will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement. If your shares are held in street name by your broker, bank or other nominee and you do not instruct the nominee how to vote your shares, a “broker non-vote” will arise and will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement.
|
Q:
|
What is the voting requirement to approve the compensation advisory proposal?
|
A:
|
The approval of the compensation advisory proposal requires stockholders holding a majority of the issued and outstanding shares of NIC common stock which are present at the Special Meeting via the Special Meeting website or represented by proxy at the Special Meeting and entitled to vote thereon, so long as a quorum is present, to vote “FOR” the compensation advisory proposal. An abstention from voting on the compensation advisory proposal will have the same effect as a vote “AGAINST” the compensation advisory proposal. If your shares are held in street name by your broker, bank or other nominee and you do not instruct the nominee how to vote your shares, a “broker non-vote” will arise but, so long as a quorum is otherwise present at the Special Meeting, will have no effect on the compensation advisory proposal. Because the vote to approve the compensation advisory proposal is only advisory in nature, it will not be binding on NIC or Tyler. Accordingly, if the merger agreement is adopted by NIC stockholders and the merger is completed, the merger-related compensation may be paid to NIC’s named executive officers even if stockholders fail to approve the compensation advisory proposal, so long as quorum is otherwise present.
|
Q:
|
What is the voting requirement to approve the adjournment proposal?
|
A:
|
The approval of the adjournment proposal requires stockholders holding a majority of the issued and outstanding shares of NIC common stock, present at the Special Meeting via the Special Meeting website or represented by proxy at the Special Meeting and entitled to vote thereon, whether or not a quorum is present, to vote “FOR” the adjournment proposal. An abstention from voting on the adjournment proposal will have the same effect as a vote “AGAINST” the adjournment proposal. If your shares are held in street name by your broker, bank or other nominee and you do not instruct the nominee how to vote your shares, a “broker non-vote” will arise but will have no effect on the adjournment proposal.
|
Q:
|
How do NIC directors and executive officers intend to vote?
|
A:
|
We currently expect that NIC directors and executive officers will vote their shares of NIC common stock “FOR” the proposal to adopt the merger agreement and the other proposals to be considered at the Special Meeting, although they have no obligation to do so.
|
Q:
|
What effects will the merger have on NIC and the NIC common stock?
|
A:
|
NIC common stock is currently registered under the Exchange Act and is listed on Nasdaq under the symbol “EGOV.” At the effective time, Merger Sub will merge with and into NIC, with NIC continuing as the surviving corporation and as a wholly-owned subsidiary of Tyler. As a result of the merger, NIC will cease to be a publicly traded company. Following the consummation of the merger, NIC common stock will be de-listed from Nasdaq and de-registered under the Exchange Act.
|
Q:
|
What effects will the merger have on NIC Restricted Stock Awards?
|
A:
|
Immediately prior to the effective time, each outstanding NIC restricted stock award that is fully vested and not subject to any restrictions (or that, pursuant to its terms as in effect on the date of the merger agreement or the terms of the merger agreement, will accelerate in full and no longer be subject to any further vesting as a result of or in connection with the consummation of the merger), will be released to the holder of such NIC restricted stock award, to the extent not previously released, and converted into the right to receive, with respect to each share of NIC common stock subject to such NIC restricted stock award (as determined in accordance with the applicable award agreement), the merger consideration, less all applicable withholding and other authorized deductions.
|
Q:
|
What will happen to the NIC Employee Stock Purchase Plan?
|
A:
|
Any NIC employee who is not a participant in the offering period in effect under the NIC ESPP as of the date of the merger agreement (which we refer to as the “current ESPP offering period”), may not become a participant in the current ESPP offering period and no current participant may increase the percentage of his or her payroll deduction election from that in effect on the date of the merger agreement for such current ESPP offering period. For the current ESPP offering period, each participant’s accumulated payroll deduction shall be used to purchase shares of NIC common stock in accordance with the terms of the NIC ESPP on the earlier of the scheduled purchase date for such current ESPP offering period and immediately prior to the effective time. No new offering period will commence under the NIC ESPP prior to the termination of the merger agreement and, subject to the consummation of the merger, the NIC ESPP will terminate effective immediately prior to the effective time.
|
Q:
|
When is the merger expected to be completed?
|
A:
|
Together with Tyler, we are working toward completing the merger as quickly as possible after the date of the Special Meeting, and currently expect to consummate the merger in the second quarter of 2021. We cannot be certain when or if the conditions to the merger will be satisfied (or, to the extent permitted, waived). The merger cannot be completed until the conditions to closing are satisfied (or, to the extent permitted, waived), including the adoption of the merger agreement by NIC stockholders.
|
Q:
|
What happens if the merger is not completed?
|
A:
|
If the merger agreement is not adopted by NIC stockholders, or if the merger is not completed for any other reason, NIC stockholders will not receive any payment for their shares of NIC common stock in connection with the merger. Except in certain circumstances where NIC has entered into an alternative transaction to the merger,
|
Q:
|
What will happen if stockholders do not approve the compensation advisory proposal?
|
A:
|
The inclusion of this proposal is required by the SEC rules. However, the approval of the compensation advisory proposal is not a condition to the completion of the merger and the vote on the compensation advisory proposal is an advisory vote and will not be binding on NIC or Tyler. If the merger agreement is adopted by NIC stockholders and the merger is completed, the merger-related compensation may be paid to NIC’s named executive officers even if stockholders fail to approve the compensation advisory proposal.
|
Q:
|
Can I revoke my proxy or change my vote?
|
A:
|
Yes. If you are a stockholder of record, you may revoke your proxy at any time before the vote is taken at the Special Meeting by:
|
•
|
voting over the Internet or by telephone as instructed on the proxy card. Only your latest Internet or telephone vote will be counted. You may not change your vote over the Internet or by telephone after 11:59 p.m. Eastern Time on April 18, 2021;
|
•
|
providing a written notice of revocation that is received before the Special Meeting by the Corporate Secretary at NIC Inc., 25501 West Valley Parkway, Suite 300, Olathe, KS 66061, Attention: Corporate Secretary;
|
•
|
completing, signing, dating and returning a new proxy card by mail to NIC before the Special Meeting (received by or with our last mail delivery before the Special Meeting begins); or
|
•
|
attending the Special Meeting and requesting that your proxy be revoked and/or voting via the Special Meeting website as instructed above.
|
Q:
|
What happens if I do not vote or if I abstain from voting on the proposals?
|
A:
|
The requisite number of shares to approve the proposal to adopt the merger agreement is based on the total number of shares of NIC common stock issued and outstanding, not just the shares that are voted. Failure to submit a signed proxy card, grant a proxy by telephone or the Internet or to vote via the Special Meeting website by ballot at the Special Meeting will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement. If your shares are held in street name by your broker, bank or other nominee and you do not instruct the nominee how to vote your shares, a “broker non-vote” will arise and will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement. For more information concerning the Special Meeting, the merger agreement and the merger, please review this proxy statement and the copy of the merger agreement attached as Annex A to this proxy statement.
|
Q:
|
If the merger is consummated, how will I receive the cash for my shares of NIC common stock?
|
A:
|
If the merger is consummated and your shares of NIC common stock are held in book-entry or in the name of a broker, bank or other custodian, the cash proceeds will be deposited into your bank or brokerage account without any further action on your part. If you hold your shares of NIC common stock in certificate form, you will receive a letter of transmittal with instructions on how to send your shares of NIC common stock to the paying agent in connection with the merger. The paying agent will issue and deliver to you a check for your shares of NIC common stock after you comply with such instructions.
|
Q:
|
What happens if the market price of shares of NIC common stock significantly changes before the closing?
|
A:
|
Tyler is not obligated to change the merger consideration of $34.00 per share of NIC common stock as a result of a change in the market price of NIC common stock.
|
Q:
|
What happens if I sell my shares of NIC common stock before completion of the merger?
|
A:
|
In order to receive the merger consideration, you must hold your shares of NIC common stock through completion of the merger. Consequently, if you transfer your shares of NIC common stock before completion of the merger, you will have transferred your right to receive the merger consideration in the merger.
|
Q:
|
Should I send in my evidence of ownership now?
|
A:
|
No. After the merger is completed, you will receive a letter of transmittal, if applicable, and related materials from the paying agent for the merger with detailed written instructions for exchanging your shares of NIC common stock evidenced by stock certificates for the merger consideration. If your shares of NIC common stock are held in street name by your broker, bank or other nominee, you will receive instructions from your broker, bank or other nominee as to what action, if any, you need to take in order to effect the surrender of your street name shares in exchange for the merger consideration. Please do not send in any documentation of evidence of ownership now.
|
Q:
|
Am I entitled to exercise dissenters’ or appraisal rights instead of receiving the merger consideration for my shares of NIC common stock?
|
A:
|
Yes. Under Section 262 of the DGCL, stockholders who do not vote for the adoption of the merger agreement have the right to seek appraisal of the fair value of their shares as determined by the Delaware Court of Chancery, but only if they fully comply with all applicable requirements of the DGCL, which are summarized in this proxy statement. Any appraisal amount determined by the court could be more than, the same as, or less than the merger consideration. Any stockholder intending to exercise appraisal rights must, among other things,
|
Q:
|
Will I be subject to U.S. federal income tax upon the exchange of NIC common stock for the merger consideration pursuant to the merger?
|
A:
|
Generally, yes, if you are a U.S. stockholder. The exchange of shares of NIC common stock for the merger consideration pursuant to the merger will be a taxable transaction for U.S. federal income tax purposes. Accordingly, an NIC stockholder that is a “U.S. holder” (as defined in the section entitled “The Merger (Proposal 1)—Material U.S. Federal Income Tax Consequences of the Merger” beginning on page 55 of this proxy statement) will recognize taxable gain or loss in an amount equal to the difference, if any, between (1) the amount of cash received by such U.S. holder in the merger and (2) such U.S. holder’s adjusted tax basis in the shares of NIC common stock exchanged therefor. With respect to an NIC stockholder that is a “non-U.S. holder” (as defined in the section entitled “The Merger (Proposal 1)—Material U.S. Federal Income Tax Consequences of the Merger” beginning on page 55 of this proxy statement), the exchange of shares of NIC common stock for the merger consideration pursuant to the merger generally will not result in tax to such non-U.S. holder under U.S. federal income tax laws unless such non-U.S. holder has certain connections with the United States. Backup withholding may apply to the cash payment made pursuant to the merger unless the NIC stockholder or other payee provides a valid taxpayer identification number and complies with certain certification procedures (generally, by providing a properly completed and executed IRS Form W-9 or IRS Form W-8 or applicable successor form).
|
Q:
|
What does it mean if I get more than one proxy card?
|
A:
|
If your shares of NIC common stock are registered differently or are held in more than one account, you will receive more than one proxy or voting instruction form. Please complete and return all of the proxy cards or voting instructions forms you receive (or submit each of your proxies or voting instructions forms by telephone or the Internet, if available to you) to ensure that all of your shares of NIC common stock are voted.
|
Q:
|
How many copies should I receive if I share an address with another stockholder?
|
A:
|
Some brokers, banks and other nominees may participate in the practice of “householding” proxy statements, annual reports and notices of Internet availability of proxy materials. This means that a single set of our proxy materials, containing a single copy of this proxy statement but multiple proxy cards or voting instruction forms, may have been sent to multiple stockholders in your household. We will promptly deliver a separate copy of our proxy materials to you if you write or call our proxy solicitor, Innisfree M&A Incorporated (which we refer to as “Innisfree”) by telephone, toll-free at +1 (877) 825-8621, or in writing at Innisfree M&A Incorporated, 501 Madison Avenue, 20th Floor, New York, NY 10022. Banks and brokers may call collect at +1 (212) 750-5833. In addition, stockholders who share a single address, but receive multiple copies of this proxy statement, may request that in the future they receive a single copy by contacting (1) NIC at NIC Inc., 25501 West Valley Parkway, Suite 300, Olathe, KS 66061, Attention: Corporate Secretary or by calling +1 (844) 944-3468 (if your shares are registered in your own name) or (2) your broker, bank or other nominee (if your shares are registered in their name).
|
Q:
|
Who will count the votes?
|
A:
|
The votes will be counted by one or more inspectors of election appointed for the Special Meeting.
|
Q:
|
Who will solicit and bear the cost of soliciting votes for the Special Meeting?
|
A:
|
NIC will pay the entire cost of preparing, assembling, printing, mailing and distributing these proxy materials. In addition to the mailing of these proxy materials, the solicitation of proxies or votes may be made by telephone or by electronic and facsimile transmission by our directors, officers and employees, who will not receive any additional compensation for such solicitation activities. NIC has engaged Innisfree as proxy advisor to assist in the solicitation of proxies for the NIC Special Meeting. NIC estimates that it will pay the proxy advisor a fee of up to $45,000, plus reimbursement of certain expenses. In addition, NIC may reimburse its transfer agent, brokerage firms and other persons representing beneficial owners of shares of NIC common stock for their expenses in forwarding solicitation material to such beneficial owners.
|
Q:
|
Are there any other risks to me from the merger that I should consider?
|
A:
|
Yes. There are risks associated with all business combinations, including the merger. See the section entitled “Forward-Looking Statements” beginning on page 21 of this proxy statement.
|
Q:
|
Where can I find the voting results of the Special Meeting?
|
A:
|
NIC will announce preliminary voting results at the Special Meeting via the Special Meeting website and publish preliminary, or final results if available, in a current report on Form 8-K filed with the SEC within four business days after the Special Meeting.
|
Q:
|
What do I need to do now?
|
A:
|
We urge you to carefully read this entire document carefully, including its annexes and the documents incorporated by reference, and to consider how the merger affects you. Your vote is important, regardless of the number of shares of NIC common stock you own. Please see the above questions “If I am a stockholder of record of shares of NIC common stock, how do I vote?” and “If I am a beneficial owner of shares of NIC common stock held in street name, how do I vote?” for a summary of instructions on how to vote.
|
Q:
|
Where can I find more information about NIC?
|
A:
|
You can find more information about us from various sources described in the section entitled “Where You Can Find Additional Information” beginning on page 93 of this proxy statement.
|
Q:
|
Who can help answer my other questions?
|
A:
|
If you have more questions about the merger, or require assistance in submitting your proxy or voting your shares or need additional copies of this proxy statement or the enclosed proxy card, please contact Innisfree, which is acting as the proxy solicitor and information agent for NIC in connection with the merger:
|
•
|
risks related to the consummation of the merger, including the risks that (1) the merger may not be consummated within the anticipated time period, or at all, (2) NIC may fail to obtain stockholder approval of the merger agreement, (3) the parties may fail to secure the termination or expiration of any waiting period applicable under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and (4) other conditions to the consummation of the merger under the merger agreement may not be satisfied;
|
•
|
the effects that any termination of the merger agreement may have on NIC or Tyler or their respective businesses, including the risks that NIC’s or Tyler’s stock price may decline significantly if the merger is not completed;
|
•
|
the effects that the announcement or pendency of the merger may have on NIC or Tyler and their respective businesses, including the risks that as a result (1) NIC’s business, operating results or stock price may suffer, (2) NIC’s current plans and operations may be disrupted, (3) NIC’s ability to retain or recruit key employees may be adversely affected, (4) NIC’s business relationships (including customers and suppliers) may be adversely affected, or (5) NIC’s management’s or employees’ attention may be diverted from other important matters;
|
•
|
the effect of limitations that the merger agreement places on NIC’s ability to operate its business, return capital to stockholders or engage in alternative transactions;
|
•
|
the nature, cost and outcome of pending and future litigation and other legal proceedings, including any such proceedings related to the merger and instituted against NIC and others;
|
•
|
the risk that the merger and related transactions may involve unexpected costs, liabilities or delays; and
|
•
|
other economic, business, competitive, legal, regulatory, and/or tax factors.
|
•
|
via the Internet, at the Internet address provided on the proxy card;
|
•
|
by telephone, by using the toll-free number listed on the proxy card; or
|
•
|
by mail, by completing, signing and dating the proxy card and returning it in the enclosed postage-paid envelope.
|
•
|
voting over the Internet or by telephone as instructed on the proxy card. Only your latest Internet or telephone vote will be counted. You may not change your vote over the Internet or by telephone after 11:59 p.m. Eastern Time on April 18, 2021;
|
•
|
providing a written notice of revocation that is received before the Special Meeting by the Corporate Secretary at NIC Inc., 25501 West Valley Parkway, Suite 300, Olathe, KS 66061, Attention: Corporate Secretary;
|
•
|
completing, signing, dating and returning a new proxy card by mail to NIC before the Special Meeting (received by or with our last mail delivery before the Special Meeting begins); or
|
•
|
attending the Special Meeting and request that your proxy be revoked and/or voting via the Special Meeting website as instructed above.
|
•
|
The belief of the NIC board of directors that the merger consideration of $34.00 in cash per share of NIC common stock represents fair value for the shares of NIC common stock, taking into account, among other things, NIC’s current and historical financial condition, results of operations, business, competitive position and prospects, as well as NIC’s near-term and long-term standalone plan in the event NIC were to remain an independent public company, and the future prospects and risks associated with remaining an independent public company and the risks and uncertainties associated with NIC’s ability to execute the standalone plan.
|
•
|
The relationship of the per share merger consideration to the current and historical market prices of NIC common stock and the fact that the per share merger consideration represents a premium to the current and historical market prices of NIC common stock, including a premium of:
|
–
|
approximately 14.1% to the closing share price of February 9, 2021, the last trading day prior to the announcement of the merger;
|
–
|
approximately 19.8% to the 20-trading day volume weighted average share price as of February 9, 2021; and
|
–
|
approximately 21.8% to the 30-trading day volume weighted average share price as of February 9, 2021.
|
•
|
The fact that the merger consideration consists solely of cash, which provides certainty of value and immediate liquidity to NIC stockholders and does not expose them to any future risks related to Tyler’s stock price or business, NIC’s stock price or business, or the financial markets generally, as compared to a transaction in which stockholders receive equity or other securities, or as compared to remaining an independent, standalone company.
|
•
|
The extent of the process conducted by the NIC board of directors and the alternatives considered, including the market check conducted by the NIC board of directors prior to entering into final negotiations with Tyler, as described in the section above entitled “The Merger (Proposal 1)—Background of the Merger” beginning on page 28 of this proxy statement.
|
•
|
The financial analysis presented to the NIC board of directors by Cowen with respect to the merger consideration and the opinion of Cowen to the NIC board of directors, to the effect that, as of February 9, 2021 and subject to the various assumptions and limitations set forth therein, the merger consideration to be received by NIC stockholders in the merger was fair, from a financial point of view, to such stockholders, as more fully described below under the section entitled “The Merger (Proposal 1)—Opinion of Financial Advisor” beginning on page 41 of this proxy statement.” The full text of Cowen’s written opinion is attached as Annex B to this proxy statement and is incorporated herein by reference.
|
•
|
The fact that the merger consideration Tyler agreed pay to the holders of NIC common stock was increased from $27.25 to $34.00 per share of NIC common stock as a result of several rounds of negotiations, as described in the section above entitled “The Merger (Proposal 1)—Background of the Merger” beginning on page 28 of this proxy statement.
|
•
|
The NIC board of directors’ concern regarding the potential impact of any potential economic downturn or the loss of one or more material customers of NIC on the price of shares of NIC common stock.
|
•
|
The belief of the NIC board of directors that the merger consideration represents the highest price per share that Tyler was willing to pay for the NIC common stock and that the terms of the merger agreement include the most favorable terms to NIC, in the aggregate, to which Tyler was willing to agree, considering the negotiations between the parties.
|
•
|
The fact that appraisal rights will be available to the holders of NIC common stock who properly exercise their rights under Delaware law, which would give these stockholders the ability to seek and be paid a judicially determined appraisal of the “fair value” of their shares of NIC common stock if they do not wish to accept the merger consideration.
|
–
|
the current and prospective business environment in which NIC operates, including national and local economic and political conditions, the competitive and regulatory environment, and the likely effect of these factors on NIC as a stand-alone company;
|
–
|
the costs, risks and uncertainties relating to the execution by NIC of its near-term and long-term standalone plan in the event NIC were to remain an independent public company;
|
–
|
the fact that NIC earns a significant portion of its revenue from a limited number of customers, and the termination or non-renewal of a contract with one or more of these customers could significantly harm NIC’s business and prospects;
|
–
|
the risk that as NIC continues to expand its services and its contracts become more profitable, the competition in the markets in which NIC operates may increase, and many of its potential competitors are national or international in scope and have greater resources than NIC;
|
–
|
the additional costs and burdens involved with being an independent public company;
|
–
|
the U.S. and general stock market conditions and volatility;
|
–
|
the other risks and uncertainties identified in NIC’s filings with the SEC, including in its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q; and
|
–
|
the NIC board of directors’ belief, after consideration of the factors described in this section, that the consummation of the transactions represents NIC’s best reasonably available alternative for maximizing stockholder value.
|
•
|
The NIC board of directors’ belief, based on a review of the possible alternatives to a sale of NIC, including the prospects of continuing to operate in accordance with the near-term and long-term strategic plan, the potential value to NIC stockholders of such alternatives and the timing and likelihood of actually achieving additional value for NIC stockholders from these alternatives, that none of these options, on a risk- and time-adjusted basis, was reasonably likely to create value for NIC stockholders greater than the merger consideration.
|
•
|
The fact that Tyler’s acquisition proposal was unsolicited and the NIC board of directors conducted a market check prior to entering into final negotiations with Tyler, as described in “The Merger (Proposal 1)—Background of the Merger” beginning on page 28 of this proxy statement.
|
•
|
The NIC board of directors’ belief that there were no other likely credible potential parties that might have an interest in engaging in a strategic transaction with NIC at a value higher than Tyler’s proposal and the absence of any such proposal being made despite the market check conducted by the NIC board of directors, as described in “The Merger (Proposal 1)—Background of the Merger” beginning on page 28 of this proxy statement.
|
•
|
The potential regulatory, commercial and financing issues that might arise in connection with pursuing any alternative transaction.
|
•
|
The timing of the merger and the risk that if NIC did not accept the Tyler offer now, it might not have another opportunity to do so or a comparable opportunity might not arise because other potential acquirers may not value NIC’s business to the same extent as Tyler.
|
•
|
The NIC board of directors considered the likelihood that the merger would be completed, in light of, among other things:
|
–
|
the business reputation and capabilities of Tyler and its management;
|
–
|
the conditions to the closing of the merger and the absence of a financing condition or similar contingency that is based on Tyler’s ability to obtain financing, the relative likelihood of obtaining required regulatory approvals, and the remedies available to NIC under the merger agreement, as well as the level of commitment by Tyler to obtain the satisfaction of the regulatory approval conditions;
|
–
|
the fact that Tyler has obtained committed debt financing for the transaction from Goldman Sachs Bank USA and represented to NIC in the merger agreement that it will have sufficient financial resources at the closing to pay the aggregate merger consideration and to consummate the merger;
|
–
|
the fact that Tyler has committed to use its reasonable best efforts to obtain all necessary regulatory clearances, subject to certain limitations, as more fully described in the section entitled “The Merger Agreement—HSR and Other Regulatory Approvals” beginning on page 72 of this proxy statement; and
|
–
|
the fact that the merger is not subject to approval by Tyler’s stockholders.
|
•
|
The NIC board of directors considered, after discussions with NIC’s legal advisors, all of the terms and conditions of the merger agreement, including the representations, warranties, covenants and agreements of the parties, the conditions to closing, the form of the merger consideration and the termination rights, including:
|
-
|
that the terms of the merger agreement were the product of arms’-length negotiations among sophisticated parties and their respective legal and financial advisors, as described in the section above entitled “The Merger (Proposal 1)—Background of the Merger” beginning on page 28 of this proxy statement;
|
-
|
the limited number and nature of the closing conditions included in the merger agreement, including the exceptions to the events that would constitute a material adverse effect (as defined in the section entitled “The Merger Agreement—Material Adverse Effect” beginning on page 63 of this proxy statement) on NIC for purposes of the merger agreement, as well as the likelihood of satisfaction of all conditions to completion of the transactions contemplated by the merger agreement;
|
-
|
that the “fiduciary out” provisions, subject to NIC’s compliance with the terms and conditions of the merger agreement, give the NIC board of directors the ability to furnish information to, and engage in negotiations with, third parties that have made an unsolicited, bona fide written acquisition proposal that is a superior proposal or would reasonably be expected to result in a superior proposal, and, upon payment of the termination fee and compliance with the other terms and conditions of the merger agreement, terminate the merger agreement in order to enter into an agreement providing for a superior proposal, as more fully described in the section entitled “The Merger Agreement—No Solicitation of Other Offers by NIC” beginning on page 68 of this proxy statement;
|
–
|
that the NIC board of directors has the ability in certain circumstances, and subject to certain conditions, to withdraw, change, amend, modify or qualify its recommendation that NIC stockholders vote to adopt the merger agreement, as more fully described in the section entitled “The Merger Agreement—No Solicitation of Other Offers by NIC” beginning on page 68 of this proxy statement and “The Merger Agreement—Change of Recommendation; Match Rights” beginning on page 70 of this proxy statement;
|
–
|
the fact that the termination fee of $55 million payable by NIC to Tyler in certain circumstances was viewed by the NIC board of directors, after consultation with its advisors, as reasonable and not likely to preclude any other party from making a competing acquisition proposal;
|
–
|
the fact that, subject to certain customary limitations, NIC will have sufficient operating flexibility for it to conduct its business in the ordinary course consistent with past practice during the pre-closing period, including the ability of NIC to continue paying its regular quarterly cash dividend during the pendency of the merger;
|
–
|
the fact that a vote of NIC stockholders is required under Delaware law to adopt the merger agreement; and
|
–
|
that the remedies of specific performance and monetary damages are available to NIC under the merger agreement, as more fully described in the section entitled “The Merger Agreement—Amendments, Enforcements and Remedies, Extensions and Waivers—Enforcements and Remedies” beginning on page 79 of this proxy statement.
|
•
|
The fact that NIC stockholders generally will have no ongoing equity participation in NIC following the merger, and that such stockholders will cease to participate in NIC’s future earnings growth, if any, or benefit from any future increase in its value following the merger.
|
•
|
The risk that there can be no assurance that all conditions to the parties’ obligations to complete the merger will be satisfied, and as a result, it is possible that the merger may not be completed, even if the merger agreement is adopted by NIC stockholders.
|
•
|
The possibility that completion of the merger might be delayed or subject to adverse conditions that may be imposed by governmental authorities that are not within NIC’s control, that the required governmental approvals may not be obtained at all, and the period of time NIC may be subject to the merger agreement without assurance that the merger will be completed.
|
•
|
The risk that the debt financing contemplated by the commitment letter will not be obtained, resulting in Tyler not having sufficient funds to complete the transaction.
|
•
|
The possibility that the transactions contemplated by the merger agreement, including the merger, might not be consummated, and the fact that if the merger is not consummated, (1) NIC’s directors, senior management and other employees will have expended extensive time and effort and will have experienced significant distractions from their work during the pendency of the transactions contemplated by the merger agreement, (2) NIC will have incurred significant transaction costs, (3) NIC’s continuing business relationships with business partners and employees may be adversely affected, (4) the trading price of NIC common stock could be materially and adversely affected and (5) the market’s perceptions of NIC’s prospects could be adversely affected.
|
•
|
The fact that the announcement of the merger agreement and pendency of the merger, or the failure to complete the merger, may cause substantial harm to NIC’s relationships with its customers, suppliers, government officials and employees (including making it more difficult to attract and retain key personnel) and may divert employees’ attention away from NIC’s day-to-day business operations.
|
•
|
The significant costs involved in connection with completing the merger, the substantial management time and effort required to complete the merger, and the related disruption to NIC’s operations.
|
•
|
The fact that the merger agreement contains restrictions on the conduct of NIC’s business prior to the completion of the merger, including generally requiring NIC to conduct its business only in the ordinary course, subject to specified limitations, and that NIC will not undertake various actions related to the conduct of its business without the prior written consent of Tyler, which may delay or prevent NIC from responding to changing market and business conditions.
|
•
|
The fact that the merger agreement precludes NIC from soliciting or, subject to certain exceptions, entertaining alternative acquisition proposals and requires NIC to pay to Tyler a termination fee of $55 million in certain circumstances, which may discourage other parties that may otherwise have an interest in a business combination with, or an acquisition of, NIC, as more fully described in the section entitled “The Merger Agreement—Termination Fee”.
|
•
|
The interests that certain NIC executive officers and directors may have with respect to the merger in addition to their interests as NIC stockholders, as described in “The Merger (Proposal 1)—Interests of NIC Directors and Executive Officers in the Merger” beginning on page 51 of this proxy statement.
|
•
|
That the gain likely to be realized by NIC stockholders as a result of the merger generally will be taxable to such stockholders for U.S. federal income tax purposes if they are not otherwise exempt from the payment of such taxes, as more fully described in “The Merger (Proposal 1)—Material U.S. Federal Income Tax Consequences of the Merger” beginning on page 55 of this proxy statement.
|
•
|
The market price of NIC’s common stock could be affected by many factors, including: (1) if the merger agreement is terminated, the reason or reasons for such termination and whether such termination resulted
|
•
|
the merger agreement;
|
•
|
certain publicly available financial and other information for NIC and certain other relevant financial and operating data furnished to Cowen by NIC’s management;
|
•
|
certain internal financial analyses, financial forecasts, reports and other information concerning NIC prepared by NIC’s management (which we refer to as the “NIC forecasts”);
|
•
|
discussions Cowen had with certain members of NIC’s management concerning the historical and current business operations, financial condition and prospects of NIC and such other matters Cowen deemed relevant;
|
•
|
certain operating results of NIC as compared to the operating results of certain publicly traded companies Cowen deemed relevant;
|
•
|
certain financial and stock market information for NIC as compared with similar information for certain publicly traded companies Cowen deemed relevant;
|
•
|
certain financial terms of the merger as compared to the financial terms of certain selected business combinations Cowen deemed relevant; and
|
•
|
such other information, financial studies, analyses and investigations and such other factors that Cowen deemed relevant for the purposes of its opinion.
|
•
|
Blackbaud, Inc.
|
•
|
Constellation Software Inc.
|
•
|
Duck Creek Technologies, Inc.
|
•
|
Guidewire Software, Inc.
|
•
|
Jack Henry & Associates, Inc.
|
•
|
Phreesia, Inc.
|
•
|
Q2 Holdings, Inc.
|
•
|
Tyler
|
•
|
ACI Worldwide, Inc.
|
•
|
EVO Payments, Inc.
|
•
|
Global Payments Inc.
|
•
|
i3 Verticals, Inc.
|
•
|
Nuvei Corporation
|
•
|
Paya Holdings Inc.
|
•
|
Shift4 Payments, Inc.
|
•
|
Booz Allen Hamilton Holding Corporation
|
•
|
Leidos Holdings, Inc.
|
•
|
Maximus, Inc.
|
•
|
Accenture plc
|
•
|
CGI Inc.
|
•
|
Cognizant Technology Solutions Corporation
|
•
|
EPAM Systems, Inc.
|
•
|
Tata Consultancy Services Limited
|
Financial Metric
|
| |
Median
|
| |
Mean
|
Vertical Software
|
| |
|
| |
|
CY2021E EBITDA
|
| |
19.7x
|
| |
25.9x
|
CY2022E EBITDA
|
| |
17.5x
|
| |
23.1x
|
Payments
|
| |
|
| |
|
CY2021E EBITDA
|
| |
22.9x
|
| |
26.8x
|
CY2022E EBITDA
|
| |
21.1x
|
| |
22.2x
|
Government Services
|
| |
|
| |
|
CY2021E EBITDA
|
| |
13.5x
|
| |
13.7x
|
CY2022E EBITDA
|
| |
12.6x
|
| |
12.4x
|
IT Services
|
| |
|
| |
|
CY2021E EBITDA
|
| |
15.0x
|
| |
19.1x
|
CY2022E EBITDA
|
| |
14.0x
|
| |
17.6x
|
Financial Metric
|
| |
Minimum
|
| |
25th
Percentile
|
| |
Median
|
| |
Mean
|
| |
75th
Percentile
|
| |
Maximum
|
CY2021E EBITDA
|
| |
11.2x
|
| |
14.3x
|
| |
19.0x
|
| |
22.5x
|
| |
28.5x
|
| |
45.8x
|
CY2022E EBITDA
|
| |
10.7x
|
| |
12.8x
|
| |
17.1x
|
| |
19.6x
|
| |
24.4x
|
| |
40.3x
|
Financial Metric
|
| |
Multiple Range
|
| |
Implied Equity Value
Reference Range
|
CY2021E Adjusted EBITDA
|
| |
14.3x - 19.0x
|
| |
$26.19 - $33.64
|
CY2022E Adjusted EBITDA
|
| |
12.8x - 17.1x
|
| |
$26.87 - $34.72
|
Date
|
| |
Target
|
| |
Acquiror
|
Vertical Software
|
||||||
12/20/20
|
| |
RealPage, Inc.
|
| |
Thoma Bravo, LLC
|
8/13/20
|
| |
Vertafore, Inc.
|
| |
Roper Technologies, Inc.
|
8/31/20
|
| |
Epicor Software Corporation
|
| |
Clayton, Dubilier & Rice, LLC
|
7/20/20
|
| |
Majesco
|
| |
Thoma Bravo, LLC
|
2/12/19
|
| |
Ellie Mae, Inc.
|
| |
Thoma Bravo, LLC
|
10/12/18
|
| |
Athenahealth, Inc.
|
| |
Veritas Capital Fund Management, L.L.C. & Elliott Associates, L.P.
|
Payments
|
||||||
11/14/20
|
| |
Nets A/S
|
| |
Nexi S.p.A.
|
2/28/19
|
| |
Speedpay (The Western Union Company’s United States bill pay business)
|
| |
ACI Worldwide, Inc.
|
5/22/19
|
| |
SafeCharge International Group Limited
|
| |
Nuvei Corporation
|
11/08/18
|
| |
Corporate Spending Innovations
|
| |
Edenred SA
|
4/09/18
|
| |
Verifone Systems, Inc.
|
| |
Francisco Partners
|
5/29/17
|
| |
CardConnect Corp.
|
| |
First Data Corporation
|
Government Services
|
||||||
2/08/21
|
| |
Cubic Corporation
|
| |
Veritas Capital
|
1/27/21
|
| |
Perspecta Inc.
|
| |
Veritas Capital
|
3/10/20
|
| |
DXC Technology Company’s U.S. State and Local Health and Human Services business
|
| |
Veritas Capital
|
2/06/20
|
| |
Unisys Corporation’s Federal Business
|
| |
Science Applications International Corporation
|
9/10/18
|
| |
Engility Holdings, Inc.
|
| |
Science Applications International Corporation
|
1/31/18
|
| |
ECS Federal, LLC
|
| |
On Assignment, Inc.
|
Date
|
| |
Target
|
| |
Acquiror
|
IT Services
|
||||||
9/10/20
|
| |
Virtusa Corporation
|
| |
Baring Private Equity Asia Pte. Limited
|
9/14/19
|
| |
Presidio, Inc.
|
| |
BC Partners
|
6/24/19
|
| |
Altran Technologies
|
| |
Capgemini S.E.
|
3/10/19
|
| |
Acando AB
|
| |
CGI
|
1/07/19
|
| |
Luxoft Holding, Inc.
|
| |
DXC Technology Company
|
11/06/18
|
| |
CovergeOne Holdings, Inc.
|
| |
CVC Capital Partners
|
7/22/18
|
| |
Syntel, Inc.
|
| |
Atos S.E.
|
11/30/17
|
| |
Aricent Technologies
|
| |
Altran Technologies, SA
|
7/24/17
|
| |
Civica
|
| |
Partners Group
|
Financial Metric
|
| |
Minimum
|
| |
25th
Percentile
|
| |
Median
|
| |
Mean
|
| |
75th
Percentile
|
| |
Maximum
|
LTM EBITDA
|
| |
8.3x
|
| |
12.1x
|
| |
15.2x
|
| |
17.3x
|
| |
20.6x
|
| |
43.9x
|
Time Period
|
| |
25th Percentile
|
| |
75th Percentile
|
1-Day Prior Closing Price
|
| |
14.1%
|
| |
33.9%
|
4-Weeks Prior Closing Price
|
| |
23.4%
|
| |
43.1%
|
Financial Metric
|
| |
Illustrative Premium Rage
|
| |
Implied Equity Value
Reference Range
|
Closing Price 1-Day Prior
|
| |
14.1% - 33.9%
|
| |
$34.02 - $39.92
|
Closing Price 4-Weeks Prior
|
| |
23.4% - 43.1%
|
| |
$33.66 - $39.04
|
Closing Price Date
|
| |
Historical Share Price
|
| |
Implied Offer Premium
|
Last Closing Price (February 9, 2021)
|
| |
$29.81
|
| |
14.1%
|
1 Month Prior
|
| |
$27.41
|
| |
24.0%
|
3 Months Prior
|
| |
$23.35
|
| |
45.6%
|
6 Months Prior
|
| |
$22.47
|
| |
51.3%
|
12 Months Prior
|
| |
$20.55
|
| |
65.5%
|
High during 12 months ending on February 9, 2021 (January 25, 2021)
|
| |
$30.81
|
| |
10.4%
|
Low during 12 months ending on February 9, 2021 (March 12, 2020)
|
| |
$15.49
|
| |
119.5%
|
Last 20-Trading Days VWAP
|
| |
$28.38
|
| |
19.8%
|
Last 30-Trading Days VWAP
|
| |
$27.92
|
| |
21.8%
|
(1)
|
EBITDA, a non-GAAP measure, refers to earnings before interest, taxes, depreciation and amortization. Adjusted EBITDA is EBITDA adjusted to exclude restructuring expense and stock-based compensation.
|
(2)
|
EBIT, a non-GAAP measure, refers to earnings before interest and taxes. EBIT does not exclude depreciation and amortization, restructuring expense or stock-based compensation.
|
(3)
|
Assumed tax rate of 25.0%.
|
(4)
|
Unlevered free cash flow, a non-GAAP measure, refers to EBIT, less taxes, plus depreciation and amortization, less capital expenditures and capitalized software and adjusted for changes in net working capital. Unlevered free cash flow was calculated by Cowen for fiscal years 2021 through 2025 using the projections provided by NIC management.
|
Name
|
| |
Shares Underlying
Unvested NIC
Restricted Stock
Awards (#)(1)
|
| |
Total Expected Value
of Unvested NIC
Restricted Stock
Awards
|
Non-Employee Directors
|
| |
|
| |
|
Art N. Burtscher
|
| |
4,182
|
| |
$142,188
|
Venmal (Raji) Arasu
|
| |
4,182
|
| |
$142,188
|
C. Brad Henry
|
| |
4,182
|
| |
$142,188
|
Sylvester James, Jr.
|
| |
1,151
|
| |
$39,134
|
Alexander C. Kemper
|
| |
4,182
|
| |
$142,188
|
William M. Lyons
|
| |
4,182
|
| |
$142,188
|
Anthony Scott
|
| |
4,182
|
| |
$142,188
|
Jayaprakash Vijayan
|
| |
4,182
|
| |
$142,188
|
Pete Wilson
|
| |
4,182
|
| |
$142,188
|
(1)
|
Except with respect to the NIC restricted stock award held by Mr. James, which is scheduled to vest on August 27, 2021, all unvested NIC restricted stock awards held by the non-employee directors of NIC vest in accordance with their terms on April 27, 2021.
|
Name
|
| |
Shares
Underlying
Unvested
Time-Based
NIC
Restricted
Stock Awards
(#)
|
| |
Total Expected
Value of Time-
Based NIC
Restricted
Share Awards
|
| |
Shares
Underlying
Unvested
Performance-
Based Restricted
Stock Awards
(#)(1)
|
| |
Total Expected
Value of
Performance-
Based NIC
Restricted Share
Awards(1)
|
| |
Total Expected
Value of NIC
Restricted
Share Awards
|
Executive Officers
|
| |
|
| |
|
| |
|
| |
|
| |
|
Harry H. Herington
|
| |
104,085
|
| |
$3,538,890
|
| |
173,202
|
| |
$5,888,868
|
| |
$9,427,758
|
Stephen M. Kovzan
|
| |
40,678
|
| |
$1,383,052
|
| |
66,610
|
| |
$2,264,740
|
| |
$3,647,792
|
Jayne Friedland Holland
|
| |
34,000
|
| |
$1,156,000
|
| |
49,484
|
| |
$1,682,456
|
| |
$2,838,456
|
William A. Van Asselt
|
| |
12,584
|
| |
$427,856
|
| |
—
|
| |
—
|
| |
$427,856
|
Douglas L. Rogers
|
| |
13,553
|
| |
$460,802
|
| |
—
|
| |
—
|
| |
$460,802
|
Brian Anderson
|
| |
19,359
|
| |
$658,206
|
| |
5,580
|
| |
$189,720
|
| |
$847,926
|
Elizabeth Thomas
|
| |
11,075
|
| |
$376,550
|
| |
—
|
| |
—
|
| |
$376,550
|
Elizabeth Proudfit
|
| |
14,769
|
| |
$502,146
|
| |
—
|
| |
—
|
| |
$502,146
|
(1)
|
Pursuant to the applicable award agreements, and assuming a closing date of March 31, 2021, performance-based NIC restricted stock awards granted in 2021 will vest at target level performance and performance-based NIC restricted stock awards granted in 2019 and 2020 will vest based on actual performance levels, as if the applicable performance period ended on December 31, 2020. The information regarding performance-based NIC restricted stock awards in these columns reflects the actual treatment of the awards as described in the preceding sentence, including the vesting at actual performance levels for performance-based NIC restricted stock awards granted in 2019 and 2020, as if the applicable performance period ended on December 31, 2020.
|
Name
|
| |
Cash Severance
($)(1)
|
| |
Annual Bonus
($)(2)
|
| |
Life, Health &
Other Benefits
($)(3)
|
| |
Total Expected
Severance ($)
|
Harry H. Herington
|
| |
$3,674,000
|
| |
$726,000
|
| |
$90,538
|
| |
$4,490,538
|
Stephen M. Kovzan
|
| |
$1,850,000
|
| |
$308,000
|
| |
$73,615
|
| |
$2,231,615
|
Jayne Friedland Holland
|
| |
$1,609,000
|
| |
$249,200
|
| |
$71,385
|
| |
$1,929,585
|
William A. Van Asselt
|
| |
$839,650
|
| |
$204,000
|
| |
$70,154
|
| |
$1,113,804
|
Douglas L. Rogers
|
| |
$755,000
|
| |
$106,750
|
| |
$70,538
|
| |
$932,288
|
Brian Anderson
|
| |
$1,024,750
|
| |
$172,500
|
| |
$67,462
|
| |
$1,264,712
|
Elizabeth Thomas
|
| |
$751,625
|
| |
$106,750
|
| |
$67,462
|
| |
$925,837
|
Elizabeth Proudfit
|
| |
$726,000
|
| |
$106,750
|
| |
$67,462
|
| |
$900,212
|
(1)
|
Amounts shown in this column represent the cash severance payments equal to the sum of: (1) two times the executive’s base salary on the date of termination; and (2) two times the largest cash award received by the executive under the annual incentive plan during the immediately preceding three annual incentive periods.
|
(2)
|
Amounts shown in this column represent the cash payment under the annual incentive plan payable for the year of the executive’s termination of employment, at target level performance.
|
(3)
|
Amounts shown in this column include: (1) payment of accrued but unpaid vacation; and (2) an estimated lump sum payment equal to 150% of NIC’s portion of the annual costs associated with providing the executive and eligible family members with medical and health benefits coverage under NIC’s group health plans.
|
•
|
a bank, insurance company, or other financial institution;
|
•
|
a tax-exempt organization;
|
•
|
a dealer or broker in securities or non-U.S. currencies;
|
•
|
a trader in securities who elects the mark-to-market method of accounting;
|
•
|
an individual subject to the alternative minimum tax provisions of the Code;
|
•
|
a mutual fund;
|
•
|
a U.S. expatriate or former citizen or long-term resident of the United States;
|
•
|
a foreign pension fund and its affiliates;
|
•
|
a person whose functional currency is not the U.S. dollar;
|
•
|
a former citizen or former long-term resident of the United States;
|
•
|
a real estate investment trust or regulated investment company;
|
•
|
an NIC stockholder that holds its shares of NIC common stock through individual retirement or other tax-deferred accounts;
|
•
|
an NIC stockholder that exercises appraisal rights;
|
•
|
an NIC stockholder that holds shares of NIC common stock as part of a hedge, appreciated financial position, straddle, or conversion or integrated transaction; or
|
•
|
an NIC stockholder that acquired shares of NIC common stock through the exercise of compensatory options or stock purchase plans or otherwise as compensation.
|
•
|
an individual who is a citizen or resident of the United States;
|
•
|
a corporation, or other entity taxable as a corporation, created or organized in or under the laws of the United States or any state therein or the District of Columbia;
|
•
|
an estate, the income of which is subject to U.S. federal income taxation regardless of its source; or
|
•
|
a trust (1) that is subject to the primary supervision of a court within the United States and all the substantial decisions of which are controlled by one or more U.S. persons or (2) that has a valid election in effect under applicable Treasury regulations to be treated as a U.S. person.
|
•
|
the gain, if any, recognized by the non-U.S. holder is effectively connected with a trade or business of the non-U.S. holder in the United States (and, if required by an applicable income tax treaty, is attributable to the non-U.S. holder’s permanent establishment in the United States);
|
•
|
the non-U.S. holder is an individual who is present in the United States for 183 days or more in the taxable year of the merger and certain other conditions are met; or
|
•
|
the non-U.S. holder owned, directly or under certain constructive ownership rules of the Code, more than 5% of NIC common stock at any time during the five-year period preceding the merger, and NIC is or has been a “United States real property holding corporation” within the meaning of Section 897(c)(2) of the Code at any time during the shorter of the five-year period preceding the merger or the period that the non-U.S. holder held the shares of NIC common stock.
|
•
|
preparing and filing or otherwise providing, in consultation with the other party and as promptly as practicable and advisable, all documentation to effect all necessary applications, notices, petitions, filings, and other documents and to obtain as promptly as reasonably practicable all waiting period expirations or terminations, consents, clearances, waivers, licenses, orders, registrations, approvals, permits and authorizations necessary or advisable to be obtained from any governmental authority in order to consummate the transactions contemplated by the merger agreement; and
|
•
|
taking all actions as may be necessary, subject to the limitations in the merger agreement, to obtain (and cooperating with each other in obtaining) all such waiting period expirations or terminations, consents, clearances, waivers, licenses, registrations, permits, authorizations, orders and approvals.
|
•
|
each share of NIC common stock issued and outstanding immediately prior to the effective time that is owned by Tyler or Merger Sub or any of their respective subsidiaries and shares owned by NIC or any of its subsidiaries, including shares held as treasury stock, will be cancelled without any consideration delivered in exchange therefor (which we refer to as “cancelled shares”);
|
•
|
each share of NIC common stock issued and outstanding immediately prior to the effective time (other than any cancelled shares, dissenting shares (as further described in the section entitled “Appraisal Rights” beginning on page 87 of this proxy statement) or shares of NIC common stock that are subject to the assumed RSAs (as further described in the section entitled “The Merger Agreement—Treatment of NIC Restricted Stock Awards” beginning on page 60 of this proxy statement)), will be automatically cancelled and converted into the right to receive the merger consideration; and
|
•
|
each share of common stock of Merger Sub issued and outstanding immediately prior to the effective time will be converted into and become one validly issued, fully paid and nonassessable share of common stock of the surviving corporation.
|
•
|
organization and qualification;
|
•
|
corporate authority relative to the merger agreement;
|
•
|
requisite stockholder approval;
|
•
|
due execution, delivery and enforceability of the merger agreement;
|
•
|
required consents and approvals;
|
•
|
no violations;
|
•
|
capitalization;
|
•
|
subsidiaries;
|
•
|
SEC reports and filings;
|
•
|
financial statements;
|
•
|
internal controls and procedures;
|
•
|
the absence of undisclosed liabilities;
|
•
|
assets;
|
•
|
material contracts;
|
•
|
customers and suppliers;
|
•
|
intellectual property;
|
•
|
privacy and data protection;
|
•
|
environmental matters;
|
•
|
labor and employment;
|
•
|
employee benefit plans;
|
•
|
insurance;
|
•
|
compliance with laws and permits;
|
•
|
litigation and orders;
|
•
|
tax matters;
|
•
|
absence of certain changes or events;
|
•
|
finders and brokers;
|
•
|
takeover statutes;
|
•
|
information supplied for this proxy statement; and
|
•
|
opinion of financial advisor.
|
•
|
organization and qualification;
|
•
|
corporate authority relative to the merger agreement;
|
•
|
due execution, delivery and enforceability of the merger agreement;
|
•
|
required consents and approvals;
|
•
|
no violations;
|
•
|
SEC reports and filings;
|
•
|
absence of undisclosed liabilities;
|
•
|
absence of changes or events;
|
•
|
ownership and prior operations of Merger Sub;
|
•
|
sufficient funds;
|
•
|
stock ownership; and
|
•
|
information supplied.
|
(1)
|
any changes or developments in U.S., regional, global or international economic conditions, including any changes or developments affecting financial, credit, foreign exchange or capital market conditions;
|
(2)
|
any changes or developments in conditions in the industries in which such party and its subsidiaries operates and any seasonal fluctuations in the business of such party and its subsidiaries;
|
(3)
|
any changes or developments in political, geopolitical, regulatory or legislative conditions in the U.S. or any other country or region of the world;
|
(4)
|
any changes or developments in GAAP or the interpretation thereof;
|
(5)
|
any changes or developments in applicable law or the interpretation thereof;
|
(6)
|
any failure by such party to meet any internal or published projections, estimates, forecasts or expectations of such party’s revenue, earnings or other financial performance or results of operations for any period, in and of itself, or any failure by such party to meet its internal budgets, plans, guidance, estimates or forecasts of its revenues, earnings or other financial performance or results of operations, in and of itself (it being understood that the facts or occurrences giving rise or contributing to such failure that are not otherwise excluded from the definition of a “material adverse effect” may be taken into account);
|
(7)
|
any acts of terrorism or sabotage, war (whether or not declared), the commencement, continuation or
|
(8)
|
any epidemic, pandemic or disease outbreak (including COVID-19) and any political or social conditions, including civil unrest, protests and public demonstrations or any other law, directive, pronouncement or guideline issued by a governmental authority, the Centers for Disease Control and Prevention or the World Health Organization, “sheltering in place,” curfews or other restrictions that relate to, or arise out of, an epidemic, pandemic or disease outbreak (including COVID-19) or any change in such law (including any binding law, order or directive by any governmental authority in connection with or in response to COVID-19), directive, pronouncement or guideline or interpretation thereof, or the action of any third party arising out of or relating to any of the foregoing, in each case, following the date of the merger agreement or any material improvement or worsening of such conditions threatened or existing as of the date of the merger agreement;
|
(9)
|
the execution and delivery of the merger agreement, the identity of NIC, Tyler or any of their subsidiaries, as applicable, or, in the case NIC, any communication by Tyler or any of its subsidiaries regarding the plans or intentions of Tyler with respect to the conduct of the business of the surviving corporation or its subsidiaries, the pendency or consummation of the merger agreement, the transactions contemplated by the merger agreement, including the effect thereof on the relationships with current or prospective customers, suppliers, distributors, partners, financing sources, employees or sales representatives, or the public announcement of the merger agreement or the transactions contemplated by the merger agreement, including any litigation arising out of or relating to the merger agreement or the transactions contemplated by the merger agreement (except that this clause will not apply to any representation or warranty to the extent the purpose of such representation or warranty is to address, as applicable, the consequences resulting from the execution and delivery of the merger agreement, the pendency or consummation of the transactions contemplated by the merger agreement);
|
(10)
|
any action or failure to take any action which action or failure to act is requested in writing by the other party or otherwise expressly required by the terms of the merger agreement (other than pursuant to NIC’s covenant to use commercially reasonable efforts to conduct its business in the ordinary course of business until the earlier of the effective time or the date (if any) the merger agreement is terminated);
|
(11)
|
any change in the price or trading volume of such party’s common stock (it being understood that the facts or occurrences giving rise or contributing to such failure that are not otherwise excluded from the definition of a “material adverse effect” may be taken into account); or
|
(12)
|
the loss or non-renewal of any customer, the termination or expiration of any contract with any customer, or the failure to enter into any contract with any prospective customer (it being understood that the facts or occurrences giving rise or contributing to such loss or non-renewal that are not otherwise excluded from the definition of a “material adverse effect” may be taken into account, as well as the aggregate loss or non-renewal of multiple contracts);
|
•
|
amend, modify, waive, rescind, change or otherwise restate NIC’s or any of its subsidiaries’ certificate of incorporation, bylaws or equivalent organizational documents;
|
•
|
authorize, declare, set aside, make or pay any dividends (other than quarterly cash dividends paid in the ordinary course of business) on or make any distribution with respect to its outstanding shares of capital stock or other equity interests (whether in cash, assets, shares or other securities of NIC or any of its subsidiaries) (other than dividends or distributions made by any wholly owned subsidiary of NIC to NIC or any wholly owned subsidiary of NIC);
|
•
|
enter into any agreement or arrangement with respect to voting or registration, or file any registration statement with the SEC with respect to any, of its capital stock or other equity interests or securities;
|
•
|
split, combine, subdivide or reclassify any of its capital stock or other equity interests, or redeem, purchase or otherwise acquire any of its capital stock or other equity interests, or any other securities in respect of, in lieu of or in substitution for, shares of its capital stock or other equity interests, except for (1) shares of NIC common stock withheld in order to pay taxes in connection with the vesting or settlement of any NIC restricted stock awards, (2) the acquisition of shares of NIC common stock in connection with the forfeiture of any NIC restricted stock awards or (3) any such transaction involving only wholly owned subsidiaries of NIC;
|
•
|
issue, deliver, grant, sell, pledge, dispose of or encumber (other than certain permitted liens), or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance (other than certain permitted liens) of, any shares of capital stock, voting securities or other equity interest in NIC or any of its subsidiaries or any securities convertible into or exchangeable or exercisable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units;
|
•
|
take any action to cause to be exercisable or vested any otherwise unexercisable or unvested NIC restricted stock awards under the NIC stock plan, including taking any action to cause acceleration of vesting of any NIC restricted stock awards granted in 2021 (except, in each case, as otherwise provided by the terms of any contract or NIC restricted stock awards and except for certain other exceptions provided in the merger agreement);
|
•
|
except as required by any NIC benefit plan or any other contract in effect as of the date of the merger agreement, (1) increase the compensation or benefits payable or to become payable to any NIC director, executive officer, or employee with an annual base salary in excess of $100,000, (2) grant any NIC director, executive officer or employee any increase in severance or termination pay, (3) pay or award, or commit to pay or award, any bonuses, retention, or incentive compensation to any of NIC's directors, executive officers or employees, (4) enter into any employment, severance, or retention agreement (excluding offer letters that provide for no severance or change in control benefits) with any of NIC's directors, executive officers or employees, (5) establish, adopt, enter into, amend, or terminate any collective bargaining agreement or NIC benefit plan, subject to certain exceptions described in the merger agreement, (6) amend or waive any performance or vesting criteria or accelerate vesting, exercisability, or funding under any NIC benefit plan, (7) terminate the employment of any NIC employee at the level of senior vice president or above, other than for cause, (8) hire any new NIC employees, except for employees at the vice president level or below, (9) provide any funding for any rabbi trust or similar arrangement, (10) enter into a contract with a professional employer organization, other than in the ordinary course of business, or (11) form or otherwise establish any employing entity in any country that does not currently have an employing entity;
|
•
|
acquire (including by merger, consolidation or acquisition of stock or assets or any other means) or authorize or announce an intention to so acquire, or enter into any binding agreements providing for any
|
•
|
liquidate (completely or partially), dissolve, restructure, recapitalize or effect any other reorganization (including any restructuring, recapitalization or reorganization between or among any of NIC or its subsidiaries), or adopt any plan or resolution providing for any of the foregoing;
|
•
|
make any loans, advances or capital contributions to, or investments in, any other person, except for (1) loans solely among NIC and its wholly owned subsidiaries or solely among NIC’s wholly owned subsidiaries or (2) advances for reimbursable employee expenses in the ordinary course of business;
|
•
|
sell, lease, license, assign, abandon, permit to lapse, transfer, exchange, swap or otherwise dispose of, or subject to any lien (other than certain permitted liens), any of its properties, rights or assets that are material to NIC and its subsidiaries, taken as a whole (including shares of NIC or its subsidiaries), except (1) dispositions of excess, obsolete or worthless equipment, in the ordinary course of business, (2) nonexclusive licenses of NIC’s owned intellectual property, products or custom applications entered into in the ordinary course of business with customers, (3) pursuant to existing contracts or (4) pursuant to transactions solely among NIC and its wholly owned subsidiaries or solely among such wholly owned subsidiaries;
|
•
|
except in the ordinary course of business, terminate or materially amend or modify any written policies or procedures with respect to the use or distribution by NIC or any of its subsidiaries of any open source software;
|
•
|
enter into or become bound by, or amend, modify, terminate or waive any contract related to the disposition or grant of any license with respect to NIC's material owned intellectual property, other than in the ordinary course of business, or otherwise encumber (other than certain permitted liens) any of NIC’s material owned intellectual property (including by the granting of any covenants, including any covenant not to sue or covenant not to assert), other than nonexclusive licenses of (1) NIC’s owned intellectual property (other than patents on a stand-alone basis) or (2) NIC products or custom applications, in each case entered into in the ordinary course of business;
|
•
|
(1) enter into certain specified types of material contracts other than (x) in the ordinary course of business or (y) to renew or replace any such material contract that has expired or terminated in accordance with its terms, (2) materially modify, materially amend, extend or terminate (other than in the ordinary course of business) any material contract, or, other than in the ordinary course of business, waive, release or assign any material rights or material claims thereunder, or (3) materially modify or amend or terminate, or waive or release or assign any material rights under, any material government bid other than in the ordinary course of business;
|
•
|
except (1) in accordance with NIC’s capital budget provided to Tyler before the date of the merger agreement, (2) in the ordinary course of business (not to exceed $1,000,000 in the aggregate) or (3) to replace or repair damaged equipment, make any capital expenditure, enter into agreements or arrangements providing for any capital expenditure or otherwise commit to do so;
|
•
|
except as provided in the merger agreement with respect to transaction-related litigation, commence (other than in the ordinary course of business or to enforce NIC's rights under the merger agreement), waive, release, assign, compromise or settle any material action, suit, claim, investigation, review or other judicial or administrative proceeding other than the compromise or settlement of any proceeding that (1) is for an amount not to exceed, for any such compromise or settlement payment by NIC, individually $250,000 or in the aggregate, $500,000 (net of insurance proceeds and indemnification proceeds received from third parties), (2) does not impose any injunctive relief on NIC and its subsidiaries and does not involve the admission of wrongdoing by NIC, any of its subsidiaries or any of their respective officers or directors or otherwise establish a materially adverse precedent for similar settlements by Tyler or any of its subsidiaries and (3) does not provide for the license of any intellectual property or the termination, modification or amendment of any license of NIC owned intellectual property;
|
•
|
make any change in financial accounting policies, practices, principles or procedures, except as required by GAAP or applicable law;
|
•
|
make, change or revoke any material tax election, adopt or change any tax accounting period or material method of tax accounting, amend any material tax return, file any material tax return that is materially inconsistent with a previously filed tax return of the same type for a prior taxable period (taking into account any amendments prior to the date of the merger agreement), settle or compromise any material liability for taxes or any tax audit, claim or other proceeding relating to a material amount of taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local or non-U.S. law), surrender any right to claim a material refund of taxes, or agree to an extension or waiver of the statute of limitations with respect to a material amount of taxes;
|
•
|
incur, assume, guarantee or otherwise become liable for or modify in any material respects in a manner adverse to NIC the terms of any indebtedness for borrowed money or any derivative financial instruments or arrangements (including swaps, caps, floors, futures, forward contracts and option agreements), or issue or sell any debt securities or calls, options, warrants or other rights to acquire any debt securities (directly, contingently or otherwise), except for (1) the incurrence of trade debt or accounts receivable in the ordinary course of business, (2) equipment leases entered into in the ordinary course of business, (3) the issuance of letters of credit under NIC’s credit agreement, (4) the incurrence of any indebtedness solely among NIC and its wholly owned subsidiaries or solely among such wholly owned subsidiaries, or (5) any guarantees by NIC of indebtedness or other obligations of any of its subsidiaries or guarantees by its subsidiaries of indebtedness or other obligations of NIC or any other NIC subsidiary, in each case incurred in compliance with the merger agreement;
|
•
|
enter into any transactions or contracts with any affiliate or other person that would be required to be disclosed by NIC under Item 404 of Regulation S-K of the SEC;
|
•
|
other than the Special Meeting, convene any special meeting (or any adjournment or postponement thereof) of NIC stockholders;
|
•
|
adopt or otherwise implement any stockholder rights plan, “poison pill” or other comparable agreement;
|
•
|
take or cause to be taken any action that would reasonably be expected to materially delay, impede or prevent the consummation of the transactions contemplated by the merger agreement on or before June 30, 2021 (which we refer to as the “outside date”); or
|
•
|
agree or authorize, in writing or otherwise, to take any of the foregoing actions.
|
(1)
|
solicit, initiate or knowingly encourage or knowingly facilitate (including by way of providing information) any inquiry with respect to, or the making, submission or announcement of, an acquisition proposal (as defined below) or any inquiry, proposal or offer that would reasonably be expected to lead to an acquisition proposal;
|
(2)
|
participate in any negotiations regarding, or furnish to any person any information relating to NIC or any of its subsidiaries in connection with, an acquisition proposal or any inquiry, proposal or offer that would reasonably be expected to lead to an acquisition proposal;
|
(3)
|
adopt, approve, endorse or recommend, or publicly propose to adopt, approve, endorse or recommend, any acquisition proposal;
|
(4)
|
withdraw, change, amend, modify or qualify, or otherwise publicly propose to withdraw, change, amend, modify or qualify, in each case, in a manner adverse to Tyler, the NIC board recommendation;
|
(5)
|
fail to include the NIC board recommendation in this proxy statement;
|
(6)
|
approve, authorize, or cause or permit NIC or any of its subsidiaries to enter into, any merger agreement, acquisition agreement, reorganization agreement, letter of intent, memorandum of understanding, agreement in principle or similar definitive agreement with respect to, or any other definitive agreement or commitment providing for, any acquisition proposal (other than certain confidentiality agreements); or
|
(7)
|
call or convene a meeting of NIC stockholders to consider a proposal that would reasonably be expected to materially impair, prevent or delay the consummation of the transactions contemplated by the merger agreement.
|
•
|
it will and will cause its subsidiaries, and its and their respective officers and directors to, and will use its reasonable best efforts to cause its and its subsidiaries’ other representatives to, immediately cease any and all solicitation, encouragement, discussions or negotiations with any persons, or the provision of any information to any persons, with respect to any acquisition proposal or any inquiry, proposal or offer that would reasonably be expected to lead to an acquisition proposal;
|
•
|
it will promptly request in writing that each person that previously executed a confidentiality agreement with NIC in connection with its consideration of an acquisition proposal or a potential acquisition proposal promptly destroy or return to NIC all nonpublic information furnished by NIC or any of its representatives to such person or any of its representatives in accordance with the terms of such confidentiality agreement; and
|
•
|
it will terminate access to any physical or electronic data rooms relating to the consideration of an acquisition proposal by any such person.
|
•
|
the NIC board of directors determines in good faith, after consulting with NIC’s outside legal counsel and financial advisors, that such proposal constitutes, or would reasonably be expected to result in, a superior proposal (as defined below); and
|
•
|
(1) prior to providing any such information, the person making the acquisition proposal enters into a confidentiality agreement that contains terms that are no less restrictive in the aggregate to such person than those contained in the confidentiality agreement between NIC and Tyler, and except for such changes as are necessary for NIC to comply with its obligations under the merger agreement (provided that the confidentiality agreement is not required to include a standstill provision), and that does not restrict NIC from complying with its disclosure obligations to Tyler under the merger agreement, and (2) NIC also provides Tyler, prior to or substantially concurrently with the time such information is provided or made available to such person (and in any event within 24 hours after), any nonpublic information furnished to such other person that was not previously furnished to Tyler.
|
•
|
any acquisition or purchase by any person or group, directly or indirectly, of more than 15% of the total voting power of the equity securities of NIC;
|
•
|
any tender offer (including a self-tender offer) or exchange offer that, if consummated, would result in any person or group beneficially owning more than 15% of the total voting power of the equity securities of NIC;
|
•
|
any merger, consolidation, share exchange, business combination, joint venture, recapitalization, reorganization or other similar transaction, in each case, involving NIC and any other person or group, pursuant to which NIC stockholders immediately prior to such transaction hold less than 85% of the total voting power of the equity interests in the surviving, resulting or ultimate parent entity of such transaction; or
|
•
|
any sale, lease, exchange, transfer or other disposition to any person or group of more than 15% of the consolidated assets of NIC and its subsidiaries, taken as a whole (measured by fair market value).
|
•
|
the NIC board of directors may make a change of recommendation in response to an intervening event (as defined below) if the NIC board of directors has determined in good faith, after consultation with NIC’s outside legal counsel, that the failure to take such action would be reasonably likely to be inconsistent with the directors’ fiduciary duties under applicable law; or
|
•
|
the NIC board of directors may make a change of recommendation and cause NIC to terminate the merger agreement in order to enter into a definitive agreement providing for an unsolicited acquisition proposal received after the date of the merger agreement that did not result from a breach of NIC’s non-solicitation obligations and such acquisition proposal is not withdrawn (subject to payment by NIC to Tyler of the termination fee described under the section entitled “The Merger Agreement—Termination Fee”), if the NIC board of directors has determined in good faith after consultation with NIC’s outside legal counsel and financial advisors that such acquisition proposal constitutes a superior proposal.
|
•
|
preparing and filing or otherwise providing, in consultation with the other party and as promptly as practicable and advisable, all documentation to effect all necessary applications, notices, petitions, filings, and other documents and to obtain as promptly as reasonably practicable all waiting period expirations or terminations, consents, clearances, waivers, licenses, orders, registrations, approvals, permits and authorizations necessary or advisable to be obtained from any governmental authority in order to consummate the transactions contemplated by the merger agreement; and
|
•
|
taking all actions as may be necessary, subject to the limitations in the merger agreement, to obtain (and cooperating with each other in obtaining) all such waiting period expirations or terminations, consents, clearances, waivers, licenses, registrations, permits, authorizations, orders and approvals.
|
•
|
to the extent not prohibited by applicable law, cooperate in all respects and consult with each other in connection with any filing or submission and in connection with any investigation or other inquiry, including any proceeding initiated by a private party;
|
•
|
furnish the other party with such necessary information and reasonable assistance as the other party may reasonably request in connection with its preparation of necessary filings or submissions of information to any governmental authority;
|
•
|
promptly inform the other party of any communication with the DOJ, the FTC or any other governmental authority, by promptly providing copies to the other party of any such written communications (or, in the case of oral communications, advise the other party of such communications), and of any communication received or given in connection with any proceeding by a private party; and
|
•
|
permit the other party to review in advance any communication that it gives to, and consult with each other in advance of any meeting, substantive telephone call or conference with, the DOJ, the FTC or any other applicable governmental authority, or, in connection with any proceeding by a private party, with any other person, and to the extent permitted by the DOJ, the FTC or other applicable governmental authority or other person, give the other party the opportunity to attend and participate in any in-person meetings, substantive telephone calls or conferences with the DOJ, the FTC or any other governmental authority or other person.
|
•
|
consultation and consent rights regarding any press releases or other public announcements or disclosures with respect to the merger, the merger agreement or the other transactions contemplated by the merger agreement;
|
•
|
certain reporting requirements under Section 16(a) of the Exchange Act;
|
•
|
the de-listing and termination of registration of NIC common stock;
|
•
|
eliminating any applicability of state takeover laws;
|
•
|
notice, cooperation and coordination relating to transaction-related litigation, if any; and
|
•
|
resignations of directors of NIC and its subsidiaries.
|
•
|
NIC stockholder approval—The adoption of the merger agreement by the affirmative vote of the holders of at least a majority of the outstanding shares of NIC common stock entitled to vote thereon;
|
•
|
Government Consents—The expiration or termination of the waiting period (or extensions thereof) under the HSR Act relating to the merger; and
|
•
|
No Injunctions or Restraints—No temporary restraining order, preliminary or permanent injunction or other judgment or order issued by any federal or state court of competent jurisdiction (which we refer to as a “restraint”) shall be in effect enjoining or otherwise prohibiting the consummation of the merger, and no law shall have been enacted, entered, promulgated, enforced or deemed applicable by any governmental authority that, in any such case, prohibits or makes illegal the completion of the merger.
|
•
|
Accuracy of Representations and Warranties—The representations and warranties of NIC in the merger agreement (without giving effect to any qualification as to materiality or material adverse effect) being true and correct as of the date of the merger agreement, and as of the closing date as though made on and as of the closing date (except for representations and warranties that by their terms speak specifically as of another date, in which case as of such date), except where the failure of such representations and warranties to be true and correct (without giving effect to any qualification as to materiality or material adverse effect) has not had and would not reasonably be expected to have, individually or in the aggregate, a material adverse effect on NIC (with such term as described under the section entitled “The Merger Agreement—Material Adverse Effect”), except that (1) certain representations and warranties related to NIC’s due organization and qualification, its power and authority to enter into the merger agreement, its capitalization, finders’ and brokers’ fees, anti-takeover laws and the opinion of NIC’s financial advisor must be true and correct in all material respects, if not qualified by materiality or material adverse effect, and in all respects, if qualified by materiality or material adverse effect; and (2) NIC’s representation and warranty that no material adverse effect on NIC (with such term as described under the section entitled “The Merger Agreement—Material Adverse Effect”) has occurred since January 1, 2020, must be true and correct in all respects, in each case, as of the date of the merger agreement and as of the closing date as though made on and as of the closing date (except for representations and warranties that by their terms speak specifically as of another date, in which case as of such date);
|
•
|
Compliance with Covenants—Except as provided in the merger agreement, performance or compliance in all material respects by NIC of the obligations, covenants and agreements required to be performed or complied with by it under the merger agreement by the time of the closing; and
|
•
|
Officer Certificate—The receipt by Tyler of a certificate, dated as of the closing date, signed on behalf of NIC by the chief executive officer or chief financial officer of NIC, certifying that the conditions set forth in the two bullet points immediately above have been satisfied.
|
•
|
Accuracy of Representations and Warranties—The representations and warranties of Tyler and Merger Sub in the merger agreement (without giving effect to any qualification as to materiality or material adverse effect) being true and correct as of the date of the merger agreement and as of the closing date as though made on and as of the closing date (except for representations and warranties that by their terms speak specifically as of another date, in which case as of such date), except where the failure of such representations and warranties to be true and correct (without giving effect to any qualification as to materiality or material adverse effect) have not had and would not reasonably be expected to have, individually or in the aggregate, a material adverse effect on Tyler (with such term as described under the section entitled “The Merger Agreement—Material Adverse Effect”) or a material adverse effect on the ability of Tyler or Merger Sub to consummate the transactions, except that (1) certain representations and warranties related to Tyler’s and Merger Sub’s due organization and qualification, their respective power and authority to enter into the merger agreement, Tyler’s ownership and prior operations of Merger Sub, sufficient funds and stock ownership must be true and correct in all material respects, if not qualified by materiality or material adverse effect, and in all respects, if qualified by materiality or material adverse effect; and (2) Tyler’s and Merger Sub’s representation and warranty that no material adverse effect on Tyler (with such term as defined in the merger agreement and described under “The Merger Agreement—Material Adverse Effect”) has occurred since December 31, 2019 must be true and correct in all respects, in each case, as of the date of the merger agreement and as of the closing date as though made on and as of the closing date (except for representations and warranties that by their terms speak specifically as of another date, in which case as of such date);
|
•
|
Compliance with Covenants—Except as provided in the merger agreement, performance or compliance in all material respects by Tyler and Merger Sub of the obligations, covenants and agreements required to be performed or complied with by it at or prior to the closing; and
|
•
|
Officer Certificate—The receipt by NIC of a certificate, dated as of the closing date, signed on behalf of Tyler by the chief executive officer or chief financial officer of Tyler certifying that the conditions set forth in the two bullet points immediately above have been satisfied.
|
•
|
by mutual written consent of NIC and Tyler; or
|
•
|
by either NIC or Tyler, if:
|
○
|
the closing has not occurred on or before outside date, except that if, on the outside date, all of the conditions to closing, other than certain conditions related to the expiration or termination, as applicable, of the waiting period (or extensions thereof) under the HSR Act, the absence of any restraint or other legal prohibition on the consummation of the merger (to the extent any such restraint is in respect of, or any such law is, the HSR Act) and those conditions that by their nature are to be satisfied at closing (but provided that such conditions shall then be capable of being satisfied if the closing were to take place on such date), have been satisfied or waived, then the outside date will automatically be extended one time for an additional three months. This right to terminate the merger agreement will not be available to any party whose action or failure to fulfill any obligation under the merger agreement has been a proximate cause of the failure of the transactions to be consummated by the outside date, and such action or failure to act constitutes a material breach of the merger agreement;
|
○
|
any restraint enjoining or otherwise prohibiting the consummation of the merger has become final and nonappealable and remains in effect. This right to terminate the merger agreement will not be available to any party whose action or failure to fulfill its obligations under the merger agreement has been a proximate cause of such restraint or of such restraint becoming final and nonappealable; or
|
○
|
the NIC stockholder approval has not been obtained by the affirmative vote of the holders of at least a majority of the outstanding shares of NIC common stock entitled to vote thereon at the Special Meeting (or any adjournment or postponement thereof).
|
•
|
the NIC board of directors effects a change of recommendation and NIC substantially concurrently enters into a definitive agreement providing for a superior proposal, as long as (1) NIC has complied in all material respects with its obligations not to solicit, participate in negotiations with respect to, or furnish certain information in connection with, any acquisition proposal or potential acquisition proposal, as further described under the section entitled “The Merger Agreement—No Solicitation of Other Offers by NIC”, and (2) substantially concurrently with or prior to (and as a condition to) such termination, NIC pays to Tyler the $55 million termination fee described below; or
|
•
|
(1) Tyler or Merger Sub has breached, failed to perform or violated their respective covenants or agreements under the merger agreement, or any of the representations and warranties of Tyler or Merger Sub in the merger agreement have become inaccurate, in either event in a manner that would give rise to a failure of the conditions in the merger agreement related to the representations and warranties of Tyler and Merger Sub or the performance by Tyler and Merger Sub of their respective obligations prior to closing; (2) such breach, failure to perform, violation or inaccuracy is incapable of being cured by the outside date or, if capable of being cured by the outside date, is not cured before the earlier of the business day immediately prior to the outside date and the 30th calendar day following receipt of written notice from NIC of such breach, failure to perform, violation or inaccuracy; and (3) NIC is not then in breach of any
|
•
|
prior to receipt of the NIC stockholder approval, the NIC board of directors has effected a change of recommendation or NIC has willfully and materially breached its obligations described under the section entitled “The Merger Agreement—No Solicitation of Other Offers by NIC”; or
|
•
|
(1) NIC has breached, failed to perform or violated its covenants or agreements under the merger agreement or any of the representations and warranties of NIC in the merger agreement have become inaccurate, in either event in a manner that would give rise to the failure of the conditions in the merger agreement related to the representations and warranties of NIC, the performance by NIC of its obligations prior to closing, and the absence of a material adverse effect on NIC; (2) such breach, failure to perform, violation or inaccuracy is incapable of being cured by the outside date or, if capable of being cured by the outside date, is not cured before the earlier of the business day immediately prior to the outside date and the 30th calendar day following receipt of written notice from Tyler of such breach, failure to perform, violation or inaccuracy; and (3) neither Tyler nor Merger Sub is then in breach of any of its representations, warranties, covenants or agreements under the merger agreement, which breach would give rise to the failure of the conditions in the merger agreement related to the representations and warranties of Tyler or Merger Sub and the performance by Tyler and Merger Sub of their respective obligations prior to closing (we refer to the events in clauses (1), (2) and (3) as an “NIC breach termination event”).
|
•
|
(1) NIC or Tyler terminates the merger agreement as a result of the closing having not occurred on or before the outside date or the NIC stockholder approval having not been obtained; (2) after the date of the merger agreement and prior to the date of the termination (or prior to the receipt of the NIC stockholder approval in the case of a termination as a result of the NIC stockholder approval having not been obtained), a bona fide acquisition proposal has been publicly disclosed and is not publicly withdrawn at least three business days prior to the earlier of the Special Meeting and the date of such termination; and (3) within 12 months of such termination, an acquisition proposal is consummated or a definitive agreement providing for an acquisition proposal is entered into, in which case NIC is required to pay such termination fee to Tyler on or prior to the date such acquisition proposal is consummated;
|
•
|
Tyler terminates the merger agreement because the NIC board of directors has effected a change of recommendation or NIC has willfully breached its obligations described under the section entitled “The Merger Agreement—No Solicitation of Other Offers by NIC”; or
|
•
|
NIC terminates the merger agreement in order to enter into a definitive agreement providing for a superior proposal.
|
•
|
an injunction or injunctions to prevent or remedy any breaches or threatened breaches of the merger agreement;
|
•
|
a decree or order of specific performance specifically enforcing the terms and provisions of the merger agreement; and
|
•
|
any further equitable relief, in each case, in addition to any other remedy to which a party is entitled at law or in equity, in each case without the obligation to obtain, furnish or post any bond or similar instrument.
|
•
|
extend the time for the performance of any of the obligations or other acts of the other parties;
|
•
|
waive any inaccuracies in the representations and warranties of the other parties; and
|
•
|
waive compliance by the other parties with any of the agreements or conditions for the benefit of such party.
|
•
|
severance payments that each named executive officer would be entitled to receive in connection with a covered termination of employment within the period commencing six months prior to and ending 18 months following a change in control of NIC, pursuant to the terms of his or her employment agreement (each described in more detail in the section entitled “The Merger (Proposal 1)—Interests of NIC Directors and Executive Officers in the Merger—Treatment of NIC Restricted Stock Awards—Employment Agreements with Executive Officers” beginning on page 53 of this proxy statement);
|
•
|
the retention bonus payments to certain named executive officers (as described in more detail in the section entitled “The Merger (Proposal 1)—Interests of NIC Directors and Executive Officers in the Merger—Treatment of NIC Restricted Stock Awards—Retention Bonuses” beginning on page 53 of this proxy statement);
|
•
|
the transaction-related bonus payment to William A. Van Asselt (as described in more detail in the section entitled “The Merger (Proposal 1)—Interests of NIC Directors and Executive Officers in the Merger—Treatment of NIC Restricted Stock Awards—Transaction-Related Bonus Payments” beginning on page 53 of this proxy statement); and
|
•
|
payments in connection with NIC’s equity-based compensation awards, the treatment of which is described in more detail in the sections entitled “The Merger (Proposal 1)—Interests of NIC Directors and Executive Officers in the Merger—Treatment of NIC Restricted Stock Awards” beginning on page 52 of this proxy statement.
|
•
|
Further details on these potential payments and benefits, including applicable vesting terms and conditions, are provided in the footnotes to the table below and in the section entitled “The Merger (Proposal 1)—Interests of NIC Directors and Executive Officers in the Merger—Treatment of NIC Restricted Stock Awards” beginning on page 52 of this proxy statement. Specified compensation does not include amounts that are already vested at the effective time.
|
•
|
the closing date is March 31, 2021, which, solely for purposes of this specified compensation disclosure, is the assumed date of the closing and to be used only for illustrative purposes;
|
•
|
immediately following the effective time, the employment of each of NIC’s named executive officers is terminated by NIC without cause or by the named executive officer with good reason under his or her employment;
|
•
|
all annual bonus payments will pay out based on the named executive officer’s 2021 target annual bonus; and
|
•
|
the value of a share of NIC common stock is $34.00, which is the merger consideration.
|
Name
|
| |
Cash(1)
|
| |
Equity(2)
|
| |
Perquisites/
Benefits(3)
|
| |
Total(4)(5)
|
Harry H. Herington
|
| |
$4,400,000
|
| |
$9,427,758
|
| |
$90,538
|
| |
$13,918,296
|
Stephen M. Kovzan
|
| |
$2,158,000
|
| |
$3,647,792
|
| |
$73,615
|
| |
$5,879,407
|
Jayne Friedland Holland
|
| |
$2,108,200
|
| |
$2,838,456
|
| |
$71,385
|
| |
$5,018,041
|
William A. Van Asselt
|
| |
$1,543,650
|
| |
$427,856
|
| |
$70,154
|
| |
$2,041,660
|
Douglas L. Rogers
|
| |
$1,111,750
|
| |
$460,802
|
| |
$70,538
|
| |
$1,639,090
|
Robert W. Knapp, Jr(6)
|
| |
$0
|
| |
$0
|
| |
$0
|
| |
$0
|
(1)
|
The amounts reflected in this column represent, for each named executive officer, an amount equal to: (1) two times annual base salary, payable in a lump sum ($1,210,000 for Mr. Herington, $770,000 for Mr. Kovzan, $712,000 for Ms. Holland, $680,000 for Mr. Van Asselt and $610,000 for Mr. Rogers); (2) two times the largest cash award received by the executive under the NIC annual incentive plan during the immediately preceding three annual incentive periods, payable in a lump sum ($2,464,000 for Mr. Herington, $1,080,000 for Mr. Kovzan, $897,000 for Ms. Holland, $159,650 for Mr. Van Asselt and $145,000 for Mr. Rogers); (3) cash payment under NIC’s annual incentive plan payable for the year of the effective time, at target level performance ($726,000 for Mr. Herington, $308,000 for Mr. Kovzan, $249,200 for Ms. Holland, $204,000 for Mr. Van Asselt and $106,750 for Mr. Rogers); (4) for each of Ms. Holland and Messrs. Van Asselt and Rogers, a one-time retention bonus award of $250,000; and (5) for Mr. Van Asselt, a one-time transaction-related bonus payment of $250,000. The cash severance payments are considered “double-trigger” payments because they will be paid only in connection with a covered termination within the period commencing six months prior to and ending 18 months following a change in control of NIC, pursuant to the terms of the applicable named executive officer’s employment agreement. The retention bonus awards will be paid at the effective time.
|
(2)
|
The amounts reflected in the table below represent the “double-trigger” value of accelerated vesting of NIC restricted stock awards held by each named executive officer upon a covered termination within the period commencing six months prior to and ending 18 months following a change in control of NIC. For more information regarding the terms of the NIC restricted stock awards held by the named executive officers and the treatment of such awards pursuant to the merger agreement, please see the section entitled “The Merger (Proposal 1)—Interests of NIC Directors and Executive Officers in the Merger—Treatment of NIC Restricted Stock Awards” beginning on page 52 of this proxy statement.
|
Name
|
| |
Expected Value of
Accelerated Time-
Based Restricted
Stock Awards
|
| |
Expected Value of
Accelerated
Performance-Based
Restricted Stock
Awards(a)
|
| |
Total Expected
Value of
Accelerated Equity
|
Harry H. Herington
|
| |
$3,538,890
|
| |
$5,888,868
|
| |
$9,427,758
|
Stephen M. Kovzan
|
| |
$1,383,052
|
| |
$2,264,740
|
| |
$3,647,792
|
Jayne Friedland Holland
|
| |
$1,156,000
|
| |
$1,682,456
|
| |
$2,838,456
|
William A. Van Asselt
|
| |
$427,856
|
| |
—
|
| |
$427,856
|
Douglas L. Rogers
|
| |
$460,802
|
| |
—
|
| |
$460,802
|
(a)
|
Pursuant to the merger agreement, each outstanding NIC performance-based restricted stock award will automatically vest in full and be cancelled and converted into the right to receive, with respect to each share of NIC common stock subject to such award, the merger consideration, less all applicable withholding and other authorized deductions. Pursuant to the applicable award agreements, and assuming a closing date of March 31, 2021, performance-based NIC restricted stock awards granted in 2021 will vest at target level performance and performance-based NIC restricted stock awards in 2019 and 2020 will vest based on actual performance levels, as if the applicable performance period ended on December 31, 2020. The information regarding performance-based NIC restricted stock awards in this column reflects the actual treatment of the awards as described in the preceding sentences, including the vesting at actual performance levels for performance-based NIC restricted stock awards granted in 2019 and 2020, as if the applicable performance period ended on December 31, 2020.
|
(3)
|
Amounts shown in this column include: (1) lump sum payment of accrued but unpaid vacation and (2) an estimated lump sum payment equal to 150% of NIC’s portion of the annual costs associated with providing the executive and eligible family members with medical and health benefits coverage under NIC’s group health plans. These payments are “double-trigger” because they will only be paid in connection with a covered termination within the period commencing six months prior to and ending 18 months following a change in control of NIC.
|
(4)
|
No named executive officer is entitled to an excise tax gross-up under Section 280G of the Code on the payments that he or she may receive in connection with the merger, including the payments reflected above. Pursuant to the terms of the named executive officers’ employment
|
(5)
|
The payment of all severance benefits is subject to the execution and non-revocation of a general release.
|
(6)
|
Mr. Knapp separated from NIC, effective January 27, 2019, and will not receive any compensatory payments in connection with the merger. Under applicable SEC disclosure rules, Mr. Knapp is considered a named executive officer for purposes of this table.
|
|
| |
Market Price
|
| |
Dividend
Declared(2)
|
|||
Quarter
|
| |
High
|
| |
Low
|
| ||
First Fiscal Quarter 2020
|
| |
$23.74
|
| |
$15.49
|
| |
0.09
|
Second Fiscal Quarter 2020
|
| |
$25.94
|
| |
$20.85
|
| |
0.09
|
Third Fiscal Quarter 2020
|
| |
$23.46
|
| |
$19.24
|
| |
0.09
|
Fourth Fiscal Quarter 2020
|
| |
$26.80
|
| |
$19.41
|
| |
0.09
|
First Fiscal Quarter 2021(1)
|
| |
$35.35
|
| |
$26.00
|
| |
0.09
|
(1)
|
Provided through March 16, 2021.
|
(2)
|
Under the terms of the merger agreement, during the pre-closing period, NIC is not permitted to authorize, declare, set aside, make or pay any dividends, other than quarterly cash dividends in the ordinary course of business (as further described in the section entitled “The Merger Agreement—Conduct of Business Before Completion of the Merger” beginning on page 64 of this proxy statement).
|
|
| |
Shares Beneficially Owned(1)
|
|||
|
| |
Number
|
| |
Percentage(2)
|
Named Executive Officers and Directors
|
| |
|
| |
|
Harry H. Herington(3)
|
| |
910,822
|
| |
1.3%
|
Stephen M. Kovzan(4)
|
| |
184,025
|
| |
*
|
Jayne Friedland Holland(5)
|
| |
129,083
|
| |
*
|
Doug Rogers(6)
|
| |
18,391
|
| |
*
|
William A. Van Asselt(7)
|
| |
29,981
|
| |
*
|
Art N. Burtscher(8)
|
| |
242,684
|
| |
*
|
Pete Wilson(9)
|
| |
92,647
|
| |
*
|
William M. Lyons(10)
|
| |
65,968
|
| |
*
|
Alexander C. Kemper(11)
|
| |
63,472
|
| |
*
|
C. Brad Henry(12)
|
| |
47,029
|
| |
*
|
Venmal (Raji) Arasu(13)
|
| |
26,957
|
| |
*
|
Anthony Scott(14)
|
| |
11,699
|
| |
*
|
Jayaprakash Vijayan(15)
|
| |
11,699
|
| |
*
|
Sylvester (Sly) James, Jr.(16)
|
| |
1,151
|
| |
*
|
All executive officers and directors as a group (14 persons)(17)
|
| |
1,835,608
|
| |
2.7%
|
|
| |
|
| |
|
5% Stockholders
|
| |
|
| |
|
BlackRock, Inc.(18)
|
| |
10,447,678
|
| |
15.4%
|
55 East 52nd Street
|
| |
|
| |
|
New York, New York 10055
|
| |
|
| |
|
|
| |
|
| |
|
The Vanguard Group, Inc.(19)
|
| |
6,813,399
|
| |
10.0%
|
100 Vanguard Blvd.
|
| |
|
| |
|
Malvern, Pennsylvania 19355
|
| |
|
| |
|
|
| |
|
| |
|
Brown Capital Management, LLC(20)
|
| |
2,656,278
|
| |
3.9%
|
1201 N. Calvert Street
|
| |
|
| |
|
Baltimore, Maryland 21202
|
| |
|
| |
|
*
|
Less than 1%
|
(1)
|
This table is based upon information supplied by officers, directors, principal stockholders and NIC’s transfer agent, and information contained in Schedules 13D and 13G filed with the SEC. Unless otherwise noted in the footnotes to this table, NIC believes each of the stockholders named in this table has sole voting and investment power with respect to the shares indicated as beneficially owned. Applicable percentages for Executive Officers and Directors are based on 67,905,010 shares of NIC common stock outstanding as of March 16, 2021, adjusted as required by the rules promulgated by the SEC. Applicable percentages for the 5% Stockholders are as reflected in the most recent Schedule 13G filed with the SEC.
|
(2)
|
For purposes of determining percentages of shares beneficially owned, NIC does not include in the number of outstanding shares those shares subject to performance-based restricted awards which are not scheduled to vest within 60 days of February 27, 2021, because the holders of such shares have no voting or disposition rights with respect to the shares. All shares subject to service-based restricted stock awards, which have voting rights, are included in outstanding shares.
|
(3)
|
Shares beneficially owned by Mr. Herington include 910,822 shares directly owned, including 104,085 shares of unvested service-based restricted stock.
|
(4)
|
Shares beneficially owned by Mr. Kovzan include 184,025 shares directly owned, including 40,678 shares of unvested service-based restricted stock.
|
(5)
|
Shares beneficially owned by Ms. Holland include 129,083 shares directly owned, including 34,000 shares of unvested service-based restricted stock.
|
(6)
|
Shares beneficially owned by Mr. Rogers include 18,391 shares directly owned, including 13,553 shares of unvested service-based restricted stock.
|
(7)
|
Shares beneficially owned by Mr. Van Asselt include 29,981 shares directly owned, including 12,584 shares of unvested service-based restricted stock.
|
(8)
|
Share beneficially owned by Mr. Burtscher include 242,684 shares directly owned, including 4,182 shares of unvested service-based restricted stock.
|
(9)
|
Shares beneficially owned by Governor Wilson include 92,647 shares directly owned, including 4,182 shares of unvested service-based restricted stock.
|
(10)
|
Shares beneficially owned by Mr. Lyons include 65,968 shares directly owned, including 4,182 shares of unvested service-based restricted stock.
|
(11)
|
Shares beneficially owned by Mr. Kemper include 63,472 shares directly owned, including 4,182 shares of unvested service-based restricted stock and 10,000 shares owned by the 2012 Alexander Charles Kemper Family Irrevocable Trust for which Mr. Kemper’s spouse is the trustee.
|
(12)
|
Shares beneficially owned by Governor Henry include 47,029 shares directly owned, including 4,182 shares of unvested service-based restricted stock.
|
(13)
|
Shares beneficially owned by Ms. Arasu include 26,957 shares directly owned, including 4,182 shares of unvested service-based restricted stock.
|
(14)
|
Shares beneficially owned by Mr. Scott include 11,699 shares directly owned, including 4,182 shares of unvested service-based restricted stock.
|
(15)
|
Shares beneficially owned by Mr. Vijayan include 11,699 shares directly owned, including 4,182 shares of unvested service-based restricted stock.
|
(16)
|
Shares beneficially owned by Mr. James include 1,151 shares directly owned, all of which are shares of unvested service-based restricted stock.
|
(17)
|
Shares held by all executive officers and directors as a group include 239,507 shares of unvested service-based restricted stock.
|
(18)
|
Based on information set forth in the Schedule 13G filed with the SEC on January 25, 2021. According to the Schedule 13G, shares beneficially owned by BlackRock, Inc. include 10,447,678 shares owned by various investment advisory clients of BlackRock, Inc. which is deemed to be a beneficial owner of those shares pursuant to Rule 13d-3 under the Exchange Act due to its discretionary power to make investment decisions over such shares for its clients and its ability to vote such shares.
|
(19)
|
Based on information set forth in Amendment No. 9 to the Schedule 13G filed with the SEC on February 10, 2021. According to the Schedule 13G, shares beneficially owned by Vanguard Group, Inc. include 6,813,399 shares owned by various investment advisory clients of Vanguard Group, Inc. which is deemed to be a beneficial owner of those shares pursuant to Rule 13d-3 under the Exchange Act due to its discretionary power to make investment decisions over such shares for its clients and its ability to vote such shares.
|
(20)
|
Based on information set forth in Amendment No. 14 to the Schedule 13G filed with the SEC on February 12, 2021. According to the Schedule 13G, shares beneficially owned by Brown Capital Management, LLC include 2,656,278 shares owned by various investment advisory clients of Brown Capital Management, LLC, which is deemed to be a beneficial owner of those shares pursuant to Rule 13d-3 under the Exchange Act due to its discretionary power to make investment decisions over such shares for its clients and its ability to vote such shares.
|
•
|
the stockholder must not vote in favor of the proposal to adopt the merger agreement;
|
•
|
the stockholder must deliver to NIC a written demand for appraisal before the vote on the merger agreement at the Special Meeting;
|
•
|
the stockholder must continuously hold the shares from the date of making the demand through the effective time (a stockholder will lose appraisal rights if the stockholder transfers the shares before the effective time); and
|
•
|
the stockholder (or any person who is the beneficial owner of shares of NIC common stock held either in a voting trust or by a nominee on behalf of such person) or the surviving corporation must file a petition in the Delaware Court of Chancery requesting a determination of the fair value of the shares within 120 days after the effective time. The surviving corporation is under no obligation to file any petition and has no intention of doing so.
|
•
|
Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed on February 25, 2021;
|
•
|
Definitive Proxy Statement for NIC 2020 annual meeting of stockholders, filed on March 12, 2020; and
|
•
|
Current Reports on Form 8-K, filed on February 10, 2021 and March 5, 2021.
|
| | |||||
|
| |
|
| |
|
| | | | |||
| | | | |||
|
| |
|
| |
|
| | |||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
| | |||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
| | |||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
| | |||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | |
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
| | |||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
| | |||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
|
| |
|
| |
|
| | |||||
|
| |
|
| |
|
| | | | |||
| | | | |||
|
| |
|
| |
|
| | |||||
|
| |
|
| |
|
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | | |||
| | | |
|
| |
TYLER:
|
|||
|
| |
|
| |
|
|
| |
TYLER TECHNOLOGIES, INC.
|
|||
|
| |
|
| |
|
|
| |
By:
|
| |
/s/ H. Lynn Moore, Jr.
|
|
| |
|
| |
Name: H. Lynn Moore, Jr.
|
|
| |
|
| |
Title: President and Chief Executive Officer
|
|
| |
|
| |
|
|
| |
MERGER SUB:
|
|||
|
| |
|
| |
|
|
| |
TOPOS ACQUISITION, INC.
|
|||
|
| |
|
| |
|
|
| |
By:
|
| |
/s/ H. Lynn Moore, Jr.
|
|
| |
Name:
|
| |
H. Lynn Moore, Jr.
|
|
| |
Title:
|
| |
President
|
|
| |
|
| |
|
|
| |
NIC:
|
|||
|
| |
|
| |
|
|
| |
NIC INC.
|
|||
|
| |
|
| |
|
|
| |
By:
|
| |
/s/ Harry H. Herington
|
|
| |
Name:
|
| |
Harry H. Herington
|
|
| |
Title:
|
| |
Chief Executive Officer
|
•
|
the Agreement;
|
•
|
certain publicly available financial and other information for the Company and certain other relevant financial and operating data furnished to Cowen by management of the Company;
|
•
|
certain internal financial analyses, financial forecasts, reports and other information concerning the Company prepared by the management of the Company (the “Company Forecasts”);
|
•
|
discussions we have had with certain members of the management of the Company concerning the historical and current business operations, financial condition and prospects of the Company and such other matters we deemed relevant;
|
•
|
certain operating results of the Company as compared to the operating results of certain publicly traded companies we deemed relevant;
|
•
|
certain financial and stock market information for the Company as compared with similar information for certain publicly traded companies we deemed relevant;
|
•
|
certain financial terms of the Transaction as compared to the financial terms of certain selected business combinations we deemed relevant; and
|
•
|
such other information, financial studies, analyses and investigations and such other factors that we deemed relevant for the purposes of this Opinion.
|
1 Year NIC Chart |
1 Month NIC Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions