Get Started for Free Contexxia identifies hard-to-find pieces of information in SEC filings. No more highlighters, no more redlining, no more poring over huge documents. RUCKUS WIRELESS INC (1294016) 10-Q published on May 02, 2016 at 7:01 pm
Reporting Period: Mar 30, 2016
On April 3, 2016, Ruckus entered into the Merger Agreement with Brocade and the Offeror. Pursuant to the Merger Agreement, on April 29, 2016, the Offeror commenced the Offer to exchange each outstanding share of the Company Common Stock for the Offer Consideration. The Offer is scheduled to expire at midnight, Eastern time, at the end of May 26, 2016 unless extended in accordance with the terms of the Merger Agreement and applicable law. As soon as practicable following the consummation of the Offer, and subject to the satisfaction or waiver of certain conditions set forth in the Merger Agreement, the Offeror will merge with and into Ruckus pursuant to the provisions of Section 251(h) of the Delaware General Corporation Law, with no stockholder vote required to consummate the Merger, and Ruckus will survive as a wholly owned subsidiary of Parent. The transaction is not subject to any financing condition. Parent intends to fund the transaction with a combination of cash on hand and committed debt financing.
On April 3, 2016, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Brocade Communications Systems, Inc., a Delaware corporation (“Parent” or "Brocade"), and Stallion Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of Parent (the “Offeror” or "Merger Sub"). Pursuant to the Merger Agreement, on April 29, 2016, the Offeror commenced an offer to exchange (the “Offer”) each outstanding share of Ruckus common stock (the “Company Common Stock”) for $6.45 in cash and 0.75 of a share of common stock of Brocade (the “Offer Consideration”). The Offer is scheduled to expire at midnight, Eastern time, at the end of May 26, 2016 unless extended in accordance with the terms of the Merger Agreement and applicable law. As soon as practicable following the consummation of the Offer, and subject to the satisfaction or waiver of certain conditions set forth in the Merger Agreement, the Offeror will merge with and into Ruckus (the “Merger”) pursuant to the provisions of Section 251(h) of the Delaware General Corporation Law, with no stockholder vote required to consummate the Merger, and Ruckus will survive as a wholly owned subsidiary of Parent. The transaction is not subject to any financing condition. Parent intends to fund the transaction with a combination of cash on hand and committed debt financing.
On April 3, 2016, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Brocade Communications Systems, Inc. ("Parent" or “Brocade”) and Stallion Merger Sub Inc., a wholly-owned subsidiary of Brocade (the “Offeror” or "Merger Sub"). Pursuant to the Merger Agreement, on April 29, 2016, the Offeror commenced an offer to exchange (the “Offer”) each outstanding share of Ruckus common stock for $6.45 in cash and 0.75 of a share of common stock of Brocade (the “Offer Consideration”). The Offeror’s obligation to accept for exchange, and to exchange, shares of Ruckus common stock for the Offer Consideration in the Offer is subject to a number of conditions, including there having been validly tendered and not validly withdrawn, in accordance with the terms of the Offer and prior to the expiration of the Offer, a number of shares of Ruckus common stock that, together with any shares of Ruckus common stock then owned by Brocade, the Offeror or Brocade’s other subsidiaries, represents at least a majority of the then-outstanding shares of Ruckus common stock (the “minimum tender condition”), the absence of certain governmental prohibitions, the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the "HSR Act"), and the receipt of any applicable approvals, consents or clearances under the competition laws of Germany. If the Offer is completed, Brocade is required by the Merger Agreement to consummate, as promptly as practicable following the consummation of the Offer, a merger of the Offeror with and into Ruckus (the “Merger”), with Ruckus surviving the Merger as a non-public subsidiary of Brocade. There is no assurance that all of the various conditions to the Offer will be satisfied, or that the Merger will be completed on the proposed terms, within the expected time frame, or at all.
The Merger Agreement contains provisions that, subject to certain exceptions, limit Ruckus’ ability to solicit, initiate, support, knowingly induce or knowingly encourage, or take any other action with the intent to facilitate, any inquiries, proposals, indications of interest or offers which constitute, or could reasonably be expected to lead to, a proposal for an alternative transaction. In addition, under specified circumstances where the Merger Agreement is terminated, Ruckus is required to pay a termination fee of $50 million. It is possible that these or other provisions might discourage a potential competing acquirer that might have an interest in acquiring all or a significant part of Ruckus from considering or proposing an acquisition or might result in a potential competing acquirer proposing to pay a lower per share price to acquire Ruckus than it might otherwise have proposed to pay.
*Two lawsuits have been filed, and further lawsuits may be filed, against Ruckus, Ruckus’ board of directors, Brocade and the Offeror challenging the Offer and the Merger. An adverse ruling in any such lawsuit may delay or prevent the Offer from being consummated or delay or prevent the Merger from becoming effective, and may result in substantial costs to Ruckus.
Pursuant to Ruckus’ amended and restated bylaws and indemnification agreements, Ruckus has an obligation to indemnify the members of its board of directors to the extent not prohibited by the Delaware General Corporation Law ("DGCL") or other applicable law, subject to certain exceptions not applicable here. This obligation may apply with respect to any stockholder class action lawsuits. There can be no assurance that Ruckus and the other defendants in these lawsuits will be successful in their defenses. An unfavorable outcome in any such lawsuit could prevent or delay the consummation of the Offer and the Merger and, regardless of the outcome, may result in substantial costs to Ruckus and may otherwise negatively affect our business and operations.