Instructure Inc Merging with Portfolium $INST

February 16, 2019 / SEC 8-K / Instructure, Inc. (the “Company”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Gas Lamp Mergers, Inc., a wholly owned subsidiary of the Company (“Merger Sub I”), Gas Lamp Mergers II, LLC, a wholly owned subsidiary of the Company (“Merger Sub II”), Portfolium, Inc. (“Portfolium”) and Fortis Advisors LLC, as Stockholders’ Agent. Pursuant to the Merger Agreement, on February 21, 2019, Merger Sub I merged with and into Portfolium (“Merger I”), and then Portfolium merged with and into Merger Sub II (“Merger II” and together with Merger I, the “Mergers”), with Merger Sub II continuing as the surviving entity and a wholly owned subsidiary of the Company. The merger closed on February 21, 2019.

Upon the closing of Merger I, all of the outstanding shares of capital stock of Portfolium and vested options to purchase shares of Portfolium common stock were cancelled and the holders were entitled to receive (1) an aggregate of 400,489 shares of common stock of the Company (the “Stock Consideration”) and (2) $25.8 million in cash, of which $4.3 million is being held in an escrow fund for the purposes of satisfying certain indemnification obligations of the equity holders of Portfolium during the twelve-month period following the closing or for certain working capital purchase price adjustments.

Also upon the closing of Merger I, each unvested option to purchase shares of Portfolium common stock was assumed by the Company and became exercisable for, and represents the right to acquire, shares of common stock of the Company (the “Assumed Options”).  The aggregate number of shares issuable upon the exercise of the Assumed Options is 42,973.  The Company intends to file a Form S-8 Registration Statement with respect to the shares of common stock of the Company issuable upon exercise of the Assumed Options.

The Merger Agreement contains representations, warranties, covenants and indemnities by the parties customary for transactions of this type.

The foregoing summary of the Merger Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Merger Agreement, a copy of which is attached as Exhibit 2.1 to this report and is incorporated by reference herein.

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