Glowpoint, Inc. (NYSE American: GLOW) (“Glowpoint”), a managed
service provider of video collaboration and network applications,
and SharedLabs, Inc. (“SharedLabs”), a privately held software and
technology services company located in Jacksonville, Florida, today
announced that they have entered into a definitive merger agreement
(the “Merger Agreement”) for the merger of Glowpoint and SharedLabs
in an all-stock transaction. Pursuant to the Merger Agreement,
SharedLabs will merge with and into a direct wholly-owned
subsidiary of Glowpoint, with SharedLabs surviving the merger as a
wholly-owned subsidiary of Glowpoint. In consideration
therefor, subject to the terms and conditions set forth in the
Merger Agreement, Glowpoint will issue an aggregate of 112,802,326
shares of Glowpoint common stock, subject to certain adjustment
factors included in the Merger Agreement and described below. The
shares of Glowpoint common stock to be issued in the transaction
will be registered with the Securities and Exchange Commission (the
“SEC”) pursuant to a Registration Statement on Form S-4 expected to
be filed with the SEC by Glowpoint in the first quarter of 2019.
The transaction was unanimously approved by the Board of Directors
of each of Glowpoint and SharedLabs. Upon completion of the
proposed merger, the name of the merged company is anticipated to
be “Glowpoint, Inc.” and the company is expected to continue to
trade on the NYSE American under the ticker symbol “GLOW.” The
combined company will maintain its headquarters in Jacksonville,
Florida. Jason Cory, the current CEO of SharedLabs, will be the CEO
of the combined company.
The business combination of Glowpoint and
SharedLabs, which on a combined basis generated total unaudited
revenue of approximately $86 million for the twelve month period
ending September 30, 2018, will combine two highly capable
businesses with strong growth opportunities, and is expected to
create a business model with increasing recurring revenue, a
diversified customer base, and significant global reach; and is
expected to result in the creation of a powerful software and
technology services provider with comprehensive products and
capabilities spanning managed, outsourced, and cloud services
offerings.
“We are extremely excited about the proposed
transaction with SharedLabs and the transformative opportunities
the combination creates for us. SharedLabs has a strong brand,
management and board along with an attractive market. We believe
the combination will enhance the business and efficiency
opportunities for both companies, and provides a structure for
future expansion, organically or by opportunistic acquisitions of
complementary assets in attractive markets, and the opportunity for
enhanced shareholder value for the combined institution,” said Pete
Holst, president and chief executive officer of Glowpoint.
“When we first announced the possibility of this
transaction, we were bullish on the combined companies’
capabilities, and after deep due diligence and seeing what is
really under the hood, we are even more excited to complete this
transaction. This really is a case of two world class technology
companies, which when combined, will become a global leader in
digital transformation and enablement, with substantial
opportunities to capitalize on the rapid evolution of digital
technologies,” said Jason Cory, chief executive officer of
SharedLabs. “Our differentiated solutions in software and
applications, web and digital, cloud, IoT, security, data and
analytics combined, coupled with the highly scalable services
platform Glowpoint offers, will provide an incredible opportunity
for the combined company to extend capabilities into new and
high-growth emerging markets. Along with the combined teams’
talented people, and our relentless focus on execution, the new
Glowpoint will have unparalleled opportunities for scale, a
comprehensive suite of solutions, and the worldwide reach to make
us the technology industry’s global partner of choice. I am excited
about leading the new Glowpoint as its president and chief
executive officer upon the closing of this transaction.”
About the Proposed Merger
Under the terms of the Merger Agreement,
Glowpoint will issue an aggregate of 112,802,326 shares of
Glowpoint common stock in exchange for 100% of the equity
securities of SharedLabs. The shares of Glowpoint common stock to
be issued in the merger are subject to certain adjustment factors
based upon the completion by SharedLabs of a private placement of
equity securities for at least $5 million of net cash proceeds and
on other terms set forth in the Merger Agreement (the “SharedLabs
Equity Financing”), the execution of one or more term sheets by
SharedLabs with lending institutions for one or more credit
facilities aggregating not less than $16 million in borrowing
capacity subject to a maximum interest rate (the “SharedLabs Term
Sheet”), the working capital of each of Glowpoint and SharedLabs at
closing compared to certain agreed upon metrics and certain other
aspects of SharedLabs’ balance sheet at closing compared to certain
agreed upon metrics. Subject to these adjustment factors, upon
consummation of the proposed merger, the stockholders of Glowpoint
existing prior to the transaction would collectively own an
approximately 34% interest in the combined company and the
stockholders of SharedLabs existing prior to the transaction would
collectively own an approximately 66% interest in the combined
company.
Glowpoint and SharedLabs, subject to stockholder
and required regulatory approvals, expect to finalize the merger in
the spring of 2019. The closing will be subject to, among other
closing conditions, the receipt of all required approvals of the
stockholders of Glowpoint and SharedLabs and any required
third-party consents and regulatory clearances, including receipt
of required approvals from the NYSE American, the effectiveness of
a Registration Statement on Form S-4 registering the shares of
Glowpoint common stock to be issued in the merger, the completion
of the SharedLabs Equity Financing, the execution by SharedLabs of
the SharedLabs Term Sheet, the satisfaction and termination prior
to closing of all contracts or other agreements to which SharedLabs
is a party that provide a counterparty with redeemable or
contingent common stock or a guaranteed return, the redemption of
each share of issued and outstanding redeemable SharedLabs common
stock, and other customary closing conditions. If SharedLabs fails
to meet its obligations under either the debt or equity financing
closing conditions, Glowpoint may elect to proceed to close the
merger with a reduction in the shares of its common stock to be
issued to SharedLabs’ stockholders in the transaction, on terms set
forth in the Merger Agreement.
Pursuant to the merger agreement, Glowpoint’s
board of directors will consist of seven members after the
completion of the merger, of which one member may be appointed by
the members of Glowpoint’s board existing prior to closing and the
remaining members will be appointed by the members of SharedLabs’
board existing prior to closing.
The Merger Agreement includes a 45-day “go-shop”
provision that allows Glowpoint and its advisors to actively
solicit and negotiate with other potential acquirers to determine
whether they are interested in making a proposal to acquire
Glowpoint. Accordingly, Glowpoint will solicit competing
acquisition proposals through February 3, 2019.
Advisors
Arnold & Porter is acting as legal advisor
to Glowpoint and Holland & Knight LLP is acting as legal
advisor to SharedLabs.
Additional Information and Where to Find
It
Glowpoint will prepare and file with the SEC a
Current Report on Form 8-K which will include as exhibits this
press release and the Merger Agreement, as executed by Glowpoint
and SharedLabs. The Form 8-K will contain important information
about the proposed business combination and related matters.
This communication does not constitute an offer
to buy or sell or the solicitation of an offer to buy or sell any
securities or a solicitation of any vote or approval, nor shall
there be any offer or sale of such securities in any state or other
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such state or other jurisdiction. This
communication relates to a proposed business combination between
Glowpoint and SharedLabs.
In connection with the proposed transaction,
Glowpoint intends to file with the SEC a registration statement on
Form S-4 that will include a proxy statement of Glowpoint that also
constitutes a prospectus of Glowpoint. Glowpoint also plans to file
other relevant documents with the SEC regarding the proposed
transaction. No offering of securities shall be made except by
means of a prospectus meeting the requirements of Section 10 of the
U.S. Securities Act of 1933, as amended. This communication is not
intended to and does not constitute an offer to sell or the
solicitation of an offer to buy any securities or the solicitation
of any vote or approval in any jurisdiction pursuant to or in
connection with the proposed transaction or otherwise. Any
definitive proxy statement/prospectus of Glowpoint will be mailed
to stockholders of Glowpoint if and when available.
INVESTORS AND SECURITY HOLDERS OF GLOWPOINT AND
SHAREDLABS ARE URGED TO READ THE REGISTRATION STATEMENT, PROXY
STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS THAT MAY BE FILED
WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE
DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY BECOME
AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE
PROPOSED TRANSACTION.
Investors and security holders will be able to
obtain free copies of these documents (if and when available) and
other documents containing important information about Glowpoint
and SharedLabs, once such documents are filed with the SEC through
the website maintained by the SEC at http://www.sec.gov. Copies of
the documents filed with the SEC by Glowpoint will also be
available free of charge on Glowpoint’s website at
www.glowpoint.com.
Participants in the
Solicitation
Glowpoint, SharedLabs and certain of their
respective directors, executive officers and other persons may be
deemed to be participants in the solicitation of proxies in respect
of the proposed transaction. Information regarding the
directors and executive officers of Glowpoint is available in its
definitive proxy statement for its 2018 annual meeting, filed with
the SEC on April 23, 2018. Other information regarding the
participants in the proxy solicitations and a description of their
direct and indirect interests, by security holdings or otherwise,
will be contained in the proxy statement/prospectus and other
relevant materials to be filed with the SEC when such materials
become available. Investors should read the proxy
statement/prospectus carefully when it becomes available before
making any voting or investment decisions. You may obtain free
copies of these documents from Glowpoint or SharedLabs using the
sources indicated above.
About Glowpoint
Glowpoint, Inc. (NYSE American: GLOW) is a
managed service provider of video collaboration and network
applications. Glowpoint’s services are designed to provide a
comprehensive suite of automated and concierge applications to
simplify the user experience and expedite the adoption of video as
the primary means of collaboration. Glowpoint’s customers include
Fortune 1000 companies, along with small and medium sized
enterprises in a variety of industries. To learn more please visit
www.glowpoint.com.
About SharedLabs
Headquartered in Jacksonville, Florida,
SharedLabs is a software and technology services company providing
a broad range of software, digital, cloud, and security services to
both commercial and government clients which enable businesses to
innovate and compete in today’s competitive marketplaces. A
respected partner to many of the largest technology companies in
the world, SharedLabs creates, supports, implements, and manages
the software, infrastructure, and e-commerce systems which drive
today’s digital world.
Forward Looking and Cautionary
Statements
This press release and any oral statements made
regarding the subject of this release contain forward-looking
statements as defined under Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended, and are made under the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995. All
statements, other than statements of historical facts, that address
activities that Glowpoint or SharedLabs assumes, plans, expects,
believes, intends, projects, estimates or anticipates (and other
similar expressions) will, could, should or may occur in the future
are forward-looking statements. Glowpoint’s and SharedLabs’ actual
results may differ materially from their expectations, estimates
and projections, and consequently you should not rely on these
forward-looking statements as predictions of future events. Without
limiting the generality of the foregoing, forward-looking
statements contained in this press release include statements
regarding Glowpoint’s and SharedLabs’ future performance and the
anticipated financial impacts of the business combination, the
success of any business development initiatives to be pursued by
Glowpoint or SharedLabs, the satisfaction of the closing conditions
to the business combination, including the debt and equity
financings to be pursued by SharedLabs, and the timing or success
of the completion of the business combination. The forward-looking
statements in this press release are based on management’s current
belief, based on currently available information, as to the outcome
and timing of future events, and involve significant factors,
risks, and uncertainties that may cause actual results in future
periods to differ materially from such statements. Most of these
factors are outside of the control of Glowpoint or SharedLabs and
are difficult to predict, and include, among other things, (1) the
occurrence of any event, change or other circumstances that could
cause the termination of the Merger Agreement; (2) the outcome of
any legal proceedings that may be instituted against Glowpoint or
SharedLabs following this announcement and the pursuit of the
business combination contemplated by the Merger Agreement; (3) the
inability to complete the business combination, including due to
failure to obtain approval of the shareholders of Glowpoint or
SharedLabs or failure to satisfy any other conditions to closing
included in the Merger Agreement; (4) risks related to SharedLabs’
equity and debt financing conditions to closing; (5) the risk that
the pursuit or execution of the business combination will disrupt
current plans and operations as a result of the announcement and
consummation of the business combination; (6) the ability to
recognize the anticipated benefits of the business combination,
which may be affected by, among other things, competition and the
ability of the combined company to grow and manage growth
profitably and retain its key employees; (7) costs related to the
negotiation and consummation of the business combination; (8) risks
related to the disruption of the transaction to the parties and
their management; (9) the effect of the announcement of the Merger
Agreement on the parties’ ability to retain and hire key personnel
and maintain relationships with customers, suppliers and other
third parties; and (10) other risks and uncertainties identified in
Glowpoint’s and SharedLabs’ filings with the SEC, including in
Glowpoint’s Annual Report on Form 10-K for the year ending December
31, 2017 and in other filings made by Glowpoint with the SEC from
time to time, including Glowpoint’s Quarterly Report on Form 10-Q
for the three months ended September 30, 2018, and including in
SharedLabs’ Form S-1 Registration Statement filed May 15, 2018
(File No. 333-224954) (including all amendments thereto) and in
other filings made by SharedLabs with the SEC from time to time.
The foregoing list of factors is not exclusive. Glowpoint and
SharedLabs caution readers not to place undue reliance upon any
forward-looking statements, which speak only as of the date made.
Any of these factors could cause Glowpoint’s and SharedLabs’ actual
results and plans to differ materially from those in the
forward-looking statements. Therefore, Glowpoint and SharedLabs can
give no assurance that their future results will be as estimated.
Glowpoint and SharedLabs do not intend to, and disclaim any
obligation to, correct, update or revise any information contained
herein to reflect any change in expectations or any change in
events, conditions or circumstances on which any such statement is
based, other than as required by applicable law.
|
|
INVESTOR
CONTACT: Investor Relations Glowpoint,
Inc.investorrelations@glowpoint.com +1
303-640-3840 www.glowpoint.com |
INVESTOR
CONTACT: Investor Relations SharedLABS,
Inc.investorrelations@sharedlabs.com +1
904-625-2372www.sharedlabs.com |
Glowpoint (AMEX:GLOW)
Historical Stock Chart
From Jun 2024 to Jul 2024
Glowpoint (AMEX:GLOW)
Historical Stock Chart
From Jul 2023 to Jul 2024