Subsequent Event

3 Months Ended

Mar. 31, 2022

16. Subsequent Event

On April 5, 2022, we entered into a definitive Agreement and Plan of Merger (the “Merger Agreement”) with Titan-Atlas Parent, Inc. (“Parent”) and Titan-Atlas Merger Sub, Inc., a direct, wholly-owned subsidiary of Parent

(“Merger Sub”), providing for the acquisition of the Company by affiliates of Stone Point Capital LLC, a Delaware limited liability company (“Stone Point Capital”), subject to the terms and conditions set forth in the Merger Agreement. Pursuant to the terms of the Merger Agreement and subject to the satisfaction or waiver of certain conditions set forth in the Merger Agreement, Merger Sub will be merged with and into the Company (the “Merger”) effective as of the effective time of the Merger (the “Effective Time”). As a result of the Merger, Merger Sub will cease to exist, and the Company will survive as a wholly-owned subsidiary of Parent.

As a result of the Merger, except as otherwise provided in the Merger Agreement, at the Effective Time, each share of Common Stock issued and outstanding immediately prior to the Effective Time will be converted into the right to receive $32.50 in cash, without interest (the “Transaction Consideration”). In addition, at the Effective Time:

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Each option to purchase Common Stock outstanding immediately prior to the Effective Time (each, a “Company Option”), whether vested or unvested, will be cancelled and will entitle the holder to receive an amount in cash (without interest and subject to applicable withholding taxes) equal to the product of (i) the number of shares of Common Stock subject to such Company Option as of immediately prior to the Effective Time and (ii) the excess, if any, of the Transaction Consideration over the exercise price per share of such Company Option. Any Company Options outstanding with exercise prices equal to or in excess of the per share Transaction Consideration will be cancelled without any payment to the holder thereof;

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Each market stock unit award of the Company (each, a “Company MSU Award”) outstanding immediately prior to the Effective Time will become vested, will be cancelled and will entitle the holder thereof to receive an amount in cash (without interest and subject to applicable withholding taxes) equal to the product of (i) the number of shares of Common Stock that would have vested pursuant to the terms of such Company MSU Award based on actual performance through the Effective Time and (ii) the Transaction Consideration; and

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Each restricted stock unit award of the Company (each, a “Company RSU Award”) outstanding immediately prior to the Effective Time will become fully vested, will be cancelled and will entitle the holder to receive an amount in cash (without interest and subject to applicable withholding taxes) equal to the product of (i) the number of shares of Common Stock subject to the Company RSU Award and (ii) the Transaction Consideration.

The consummation of the Merger is subject to the satisfaction or waiver of various customary conditions set forth in the Merger Agreement, including, but not limited to, (i) the Company’s stockholders’ approval of the Merger Agreement, (ii) the expiration or termination of any applicable waiting period (or any extensions thereof) under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), (iii) the absence of any restraint or law preventing or prohibiting the consummation of the Merger, (iv) the accuracy of Parent’s, Merger Sub’s, and the Company’s representations and warranties (subject to certain materiality qualifiers), (v) Parent’s, Merger Sub’s and the Company’s compliance in all material respects with their respective obligations under the Merger Agreement, and (vi) the absence of any Company Material Adverse Effect (as defined in the Merger Agreement) since the date of the Merger Agreement. The consummation of the Merger is not subject to a financing condition.

During the three months ended March 31, 2022, we incurred expenses of $1.1 million related to the proposed Merger, which primarily consisted of legal and other professional fees and are reported as selling, general and administrative expenses in the consolidated statements of operations. On April 5, 2022, upon entering into the Merger Agreement, we incurred $2.5 million of financial advisory fees, which we recorded during the second quarter of 2022.

See Item IA. Risk Factors for a discussion of the risks related to the Merger.