This excerpt taken from the NDAQ 8-K filed May 31, 2007.
Pursuant to the Transaction Agreement, the consideration to be offered by Nasdaq in the Offer is equivalent to 0.502 shares of Nasdaq common stock plus SEK 94.3 in cash for each OMX share. Based on Nasdaqs closing price on May 23, 2007 and an exchange rate of SEK 6.83 per US$, the Offer valued OMX at SEK 208.1 per share. Nasdaq has agreed to apply for a secondary listing on the OMX Nordic Exchange.
The Transaction Agreement provides that the Offer is subject to satisfaction of the conditions set forth in the press release issued by Nasdaq and OMX on May 25, 2007, which is attached to the Transaction Agreement as Appendix 1.1. The conditions include, among others (i) that the Offer be accepted to such an extent that Nasdaq becomes the owner of shares representing more than 90 percent of the outstanding shares of OMX on a fully diluted basis (which percentage may be reduced to not less than 67 percent in Nasdaqs sole discretion), (ii) that Nasdaqs shareholders approve the issuance of the Nasdaq shares in connection with the Offer and (iii) the receipt of all required regulatory approvals. Subject to certain exceptions and the termination provisions discussed below, Nasdaq has agreed to extend the Offer if, at the scheduled expiration date of the Offer or any extension thereof, the conditions to the Offer have not been satisfied or waived.
Each of Nasdaq and OMX has agreed that it will not, among other things (i) solicit, initiate, encourage, induce or facilitate an alternative acquisition proposal for itself, (ii) furnish information regarding itself to a third party or (iii) engage in any discussions or negotiations with any third party with respect to an alternative acquisition proposal, unless, in the case of clauses (ii) and (iii), a party receives a bona fide unsolicited written alternative acquisition proposal and (a) such party and its representatives have not violated any of the non-solicitation provisions in the Transaction Agreement, (b) a majority of such partys board (after consultation with its financial advisors and outside legal counsel) determines that such proposal is or is reasonably likely to result in a superior proposal to the transactions contemplated by the Transaction Agreement and (c) such partys board concludes, after having taken into account the advice of its financial advisors and outside legal counsel, that a failure to take such action would reasonably be likely to be inconsistent with the partys boards fiduciary obligations to its stockholders.
The OMX boards recommendation of the Offer may only be withdrawn or substantially changed if (i) OMX has complied in all material respects with the non-solicitation provisions in the Transaction Agreement and a superior proposal to the Offer is made, (ii) a material adverse change has occurred with respect to Nasdaq or (iii) information made public by Nasdaq or disclosed by Nasdaq to OMX is materially misleading, or Nasdaq has failed to make public any material information which should have been made public by it, and in any such case the OMX board determines, after consultation with its outside financial and legal advisors, that not withdrawing or changing its recommendation of the Offer would reasonably be likely to be inconsistent with the OMX boards fiduciary obligations to its shareholders.
The Nasdaq boards recommendation that Nasdaq shareholders approve the issuance of the Nasdaq shares in connection with the Offer may only be withdrawn or substantially changed if a material adverse change has occurred with respect to OMX, and as a result the Nasdaq board determines, after consultation with its outside financial and legal advisors, that not withdrawing or changing its recommendation would reasonably be likely to be inconsistent with the Nasdaq boards fiduciary obligations to its shareholders.
Upon consummation of the Offer, the name of the combined company will be changed to The NASDAQ OMX Group, Inc., subject to approval by Nasdaqs shareholders of an amendment to Nasdaqs certificate of incorporation to approve such change of name. Upon consummation of the Offer, the Nasdaq board will consist of fifteen directors, comprised of nine individuals from (or nominated by) the Nasdaq board as of immediately prior to consummation of the Offer, Nasdaqs CEO and five individuals from (or proposed for nomination by) the OMX board as of immediately prior to consummation of the Offer. With respect to the individuals from (or proposed for nomination by) the OMX board, such individuals must be reasonably acceptable to Nasdaq and four of such individuals must be independent for purposes of Nasdaqs director independence standards. Upon consummation of the Offer, Nasdaqs Chief Executive Officer (currently Robert Greifeld) will serve as Chief Executive Officer of the combined company and OMXs Chief Executive Officer (currently Magnus Böcker) will serve as President of the combined company.
The Chairman of the combined company will represent the global span of the merged Nasdaq and OMX. Nasdaq and OMX will utilize Nasdaqs recruitment tool BoardRecruiting.com and a well-reputed search firm to identify internal and external candidates, it being the belief of Nasdaq and OMX that the appropriate size of the Nasdaq board is 15 directors. OMX and Nasdaq will each have the right to nominate candidates for Chairman. The Deputy Chairman of the Nasdaq board will for the two years following the consummation of the Offer be one of the five individuals from (or proposed for nomination by) the OMX board as of immediately prior to the consummation of the Offer. As of the consummation of the Offer, OMX may elect to have one-third of the members of each committee of the Nasdaq board be selected from the directors selected from (or proposed for nomination by) the OMX board, subject to applicable law, regulation or stock exchange listing standard. As of the consummation of the Offer, three individuals nominated by OMX will become members of the Nominating Committee of Nasdaq. The composition of the local Board of OMX Exchanges Ltd. will remain unchanged following the consummation of the Offer. The Parties do not anticipate any changes to the governance of The NASDAQ Stock Market LLC as a result of the consummation of the Offer.
The Transaction Agreement (i) may be terminated by written consent of both Nasdaq and OMX, (ii) may be terminated by either OMX or Nasdaq if the Offer lapses or is withdrawn, (iii) may be terminated by either OMX or Nasdaq if the Offer is not declared unconditional by February 29, 2008 and (iv) will automatically terminate if either the OMX board recommendation (with respect to the Offer) or the Nasdaq board recommendation (with respect to approval of the issuance of the Nasdaq shares in connection with the Offer) is withdrawn in accordance with the Transaction Agreement.
If either party is in breach of its obligations under the Transaction Agreement (other than in immaterial respects), it must pay the other partys costs, fees and expenses up to a maximum of $15,000,000.
Pursuant to the Transaction Agreement, each of OMX and Nasdaq have agreed, among other things, not to acquire any shares or other securities in the other until the earlier of (i) 9 months following termination of the Transaction Agreement and (ii) December 31, 2008. The foregoing restriction does not apply to the Offer itself.
The foregoing description of the Transaction Agreement does not purport to be complete and is qualified in its entirety by reference to the Transaction Agreement, a copy of which is filed as Exhibit 10.1 hereto and is hereby incorporated into this report by reference.