AGREEMENT AND PLAN OF MERGER by and between ALLIANCE DATA SYSTEMS CORPORATION, CONVERSANT, INC. and AMBER SUB LLC Dated as of September 11, 2014

Exhibit 2.1

AGREEMENT AND PLAN OF MERGER

by and between

ALLIANCE DATA SYSTEMS CORPORATION,

CONVERSANT, INC.

and

AMBER SUB LLC

Dated as of September 11, 2014

---

TABLE OF CONTENTS

 

Page

 

 

---

 

 

 

---

 

---

AGREEMENT AND PLAN OF MERGER

This AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated as of September 11, 2014, is by and between Conversant, Inc., a Delaware corporation (the "Company"), Alliance Data Systems Corporation, a Delaware corporation ("Parent") and Amber Sub LLC, a Delaware limited liability company and a wholly owned subsidiary of Parent ("Merger Sub").

WHEREAS, provided that the Reverse Merger Condition is not satisfied, the parties intend that the Company shall be merged with and into Merger Sub (the "Merger"), with Merger Sub surviving the Merger as a wholly owned subsidiary of Parent;

WHEREAS, the Board of Directors of the Company (the "Company Board of Directors") has unanimously (i) determined that it is in the best interests of the Company stockholders, and declared it advisable, to enter into this Agreement, (ii) approved the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, including the Merger and (iii) resolved to recommend adoption of this Agreement by the Company stockholders;

WHEREAS, the Board of Directors of Parent has unanimously (i) determined that it is in the best interests of Parent and its stockholders (as the case may be), and declared it advisable, to enter into this Agreement and (ii) approved the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, including the Merger;

WHEREAS,  the Managers of Merger Sub have unanimously (i) determined that it is in the best interests of Merger Sub, and declared it advisable, to enter into this Agreement and (ii) approved the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, including the Merger, and adopted this Agreement;

WHEREAS, as a condition and inducement to Parent's willingness to enter into this Agreement, certain Company stockholders have simultaneously herewith entered into Voting Agreements (each, a "Voting Agreement" and, collectively, the "Voting Agreements") in connection with the Merger;

WHEREAS, provided that the Reverse Merger Condition is not satisfied, the parties intend that the Merger qualify as a "reorganization" under the provisions of Section 368(a) of the Internal Revenue Code of 1986, as amended (the "Code") for United States federal income tax purposes, and the parties intend, by executing this Agreement, to adopt a "plan of reorganization" within the meaning of Treasury Regulations, Section 1.368-2(g); and

WHEREAS, Parent, Merger Sub and the Company desire to make certain representations, warranties, covenants and agreements specified herein in connection with this Agreement.

---

NOW, THEREFORE, in consideration of the foregoing and the representations, warranties, covenants and agreements contained herein, and intending to be legally bound hereby, Parent, Merger Sub and the Company agree as follows:

ARTICLE I

THE MERGER

---

ARTICLE II

CONVERSION OF SHARES; EXCHANGE OF CERTIFICATES

---

Stock Award and any Dissenting Shares) shall be automatically converted into the right to receive the following consideration (together, the "Merger Consideration"):

---

possible, all cash or all Parent Common Stock, but with the consideration payable on each such share of Company Common Stock pro rated to the extent there is not enough cash or enough Parent Common Stock to pay pursuant to each such election (and with the difference between such pro rated amount being made up in the remaining Parent Common Stock or cash, as applicable).  For the avoidance of doubt, regardless of the number of shares of Company Common Stock that are subject to either a Cash Election or a Stock Election, the aggregate amount of cash and Parent Common Stock payable by Parent in the Merger shall equal the aggregate amount of cash and Parent Common Stock that would have been payable if no election had been made with respect to any shares of Company Common Stock.  Example pro ration calculations reflecting the parties' intent are given in Exhibit 2.1 of this Agreement.

All of the shares of Company Common Stock converted into the right to receive the Merger Consideration pursuant to this Article II shall no longer be outstanding and shall automatically be cancelled and shall cease to exist as of the Effective Time, and uncertificated shares of Company Common Stock represented in book-entry form ("Book-Entry Shares") and each certificate that, immediately prior to the Effective Time, represented any such shares of Company Common Stock (each, a "Certificate") shall thereafter represent only the right to receive the Merger Consideration and the Fractional Share Cash Amount, plus any dividends or other distributions to which such Certificates or Book-Entry Shares become entitled in accordance with Section 2.2(e).

---

event shall have occurred, then the Merger Consideration shall be equitably adjusted, without duplication, to proportionally reflect such change; provided, however, that nothing in this Section 2.1(c)  shall be construed to permit the Company or Parent to take any action with respect to its securities that is prohibited by the terms of this Agreement.

---

 

---

---

accordance with Section 2.2(d) (together with the Fractional Share Cash Amount and any dividends or other distributions to which such Certificates or Book-Entry Shares become entitled in accordance with Section 2.2(e)), without interest.  From and after the Effective Time, the stock transfer books of the Company shall be closed, and there shall be no further registration of transfers on the stock transfer books of the Surviving Company of shares of Company Common Stock that were outstanding immediately prior to the Effective Time.  If, after the Effective Time, any Certificates or Book-Entry Shares formerly representing shares of Company Common Stock are presented to the Surviving Company, Parent or the Exchange Agent for any reason, such Certificates or Book-Entry Shares shall be cancelled and exchanged as provided in this Article II, subject to applicable Law in the case of Dissenting Shares.

---

---

---

---

revoked if this Agreement is terminated in accordance with Article VII.  If a Cash Election or Stock Election is revoked and the Closing occurs, the shares as to which such election previously applied shall automatically receive the Base Consideration in accordance with Section 2.1(a)(iii) unless a contrary election is properly made and submitted by the holder prior to the Election Deadline.  If a Cash Election or Stock Election is revoked, Certificates will be returned to holders, and the accounts of holders of Book-Entry Shares will be credited at the Depository Trust Company or equivalent, except to the extent a subsequent election is made with respect to any or all of such Certificates or Book-Entry Shares.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

Except as disclosed in (i) the Company SEC Documents publicly filed under Sections 13(a), 14(a) or 15(d) of the Exchange Act since January 1, 2014 and prior to the date hereof (excluding any disclosures set forth in any such Company SEC Document in any risk factor section, any disclosure in any section relating to forward-looking statements or any other statements that are similarly predictive or forward-looking in nature, in each case, other than any specific factual information contained therein), where the relevance of the information to a particular representation is readily apparent on the face of such disclosure or (ii) the disclosure schedule delivered by the Company to Parent immediately prior to the execution of this Agreement (the "Company Disclosure Schedule") (provided that disclosure in any section of such Company Disclosure Schedule shall apply only to the corresponding section of this Agreement except to the extent that it is readily apparent on the face of such disclosure that such

---

disclosure applies to another representation), the Company represents and warrants to Parent as follows:

---

Stock Awards, (B) 351,676 shares of Company Common Stock were reserved for issuance under the Dotomi, Inc. 2003 Stock Option and Incentive Plan, of which amount 351,676 shares were issuable upon the exercise of outstanding Company Options, (C) 20,403 shares of Company Common Stock were reserved for issuance under the Greystripe, Inc. 2005 Stock Plan, of which amount 20,403 shares were issuable upon the exercise of outstanding Company Options, (D) 44,413 shares of Company Common Stock were reserved for issuance under the SET Media, Inc. 2007 Stock Incentive Plan, of which amount 44,413 shares were issuable upon the exercise of outstanding Company Options, and (E) 1,000 shares of Company Common Stock were reserved for issuance under the Fastclick, Inc. 2005 Equity Incentive Plan, of which amount 1,000 were issuable upon the exercise of outstanding Company Options (v) 1,790,904 shares of Company Common Stock were reserved for issuance under the Company ESPP, of which amount 127,707 shares were acquired after the purchase period closed on August 31, 2014, and (vi) no other shares of capital stock or other voting securities of the Company were issued, reserved for issuance or outstanding.  All outstanding shares of Company Common Stock are, and shares of Company Common Stock reserved for issuance with respect to Company Stock Awards, when issued in accordance with the respective terms thereof, will be, duly authorized, validly issued, fully paid and nonassessable and free of preemptive rights.  Except (i) as set forth in this Section 3.2(a) and Section 3.2(b) or (ii) as expressly permitted by Section 5.1(b)(E) (related to capital stock), there are no outstanding subscriptions, options, warrants, calls, convertible securities, exchangeable securities or other similar rights, agreements, contracts or commitments to which the Company or any of its Subsidiaries is a party (A) obligating the Company or any of its Subsidiaries to (1) issue, transfer, exchange, sell or register for sale any shares of capital stock or other equity interests of the Company or any Subsidiary of the Company or securities convertible into or exchangeable for such shares or equity interests, (2) grant, extend or enter into any such subscription, option, warrant, call, convertible securities or other similar right, agreement or arrangement relating to the capital stock or other equity interest of the Company or any Subsidiary of the Company, (3) redeem or otherwise acquire any such shares of capital stock or other equity interests of the Company or its Subsidiaries, (4) provide a material amount of funds to, or make any material investment (in the form of a loan, capital contribution or otherwise) in, any Subsidiary that is not a wholly-owned Subsidiary of the Company or (5) make any payment to any person the value of which is derived from or calculated based on the value of Company Common Stock or Company Preferred Stock, or (B) granting any preemptive or antidilutive or similar rights with respect to any security issued by the Company or its Subsidiaries.  No Subsidiary of the Company owns any shares of capital stock of the Company.  Neither the Company nor any of its Subsidiaries has outstanding any bonds, debentures, notes or other indebtedness, the holders of which have the right to vote (or which are convertible or exchangeable into or exercisable for securities having the right to vote) with the Company stockholders on any matter.  There are no voting trusts or other agreements or understandings to which the Company or any of its Subsidiaries is a party with respect to the voting or registration of the capital stock or other equity interest of the Company or any of its Subsidiaries.

(b)            Section 3.2(b) of the Company Disclosure Schedule sets forth a true and complete list of all Company Stock Awards outstanding as of September 8, 2014, specifying, on a holder-by-holder basis, (i) the name of each holder, (ii) the number of shares subject to each such Company Stock Award, (iii) the grant date of each such Company Stock Award, (iv) the vesting schedule of each such Company Stock Award, (v) the exercise price for each such 15

Company Stock Award, to the extent applicable, (vi) the expiration date of each such Company Stock Award, to the extent applicable, (vii) whether such Company Stock Award is intended to qualify as an "incentive stock option" under Section 422 of the Code and (viii) the Company Stock Plan under which the Company Stock Award was granted.  With respect to each grant of Company Stock Awards, each such grant was in all material respects made in accordance with the terms of the Company Stock Plan, the Exchange Act and all other applicable Laws, including the rules of Nasdaq.

 

---

 insolvency, moratorium or other similar Laws affecting creditor's rights generally and the availability of equitable relief and any implied covenant of good faith and fair dealing (the "Enforceability Exceptions").

---

---

on the other hand) or any "off-balance sheet arrangements" (as defined in Item 303(a) of Regulation S-K of the SEC).

---

would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Company.  Since June 30, 2013, neither the Company nor any of its Subsidiaries has received any written notice or, to the Company's knowledge, other communication from any Governmental Entity regarding any actual or possible failure on the part of the Company or any of its Subsidiaries to comply with any material Law in a material respect.

---

attorney representing the Company or any Subsidiary of the Company, whether or not employed by the Company or any Subsidiary of the Company, has reported evidence of any material violation of state or federal banking or securities Laws, breach of fiduciary duty or similar violation, relating to periods after January 1, 2011, by the Company, any Subsidiary of the Company or any of their respective officers, directors, employees or agents to the Company Board of Directors or any committee thereof, or to the General Counsel or Chief Executive Officer of the Company.

---

have been made available to Parent by the Company to the extent applicable:  (i) any plan documents and related trust documents, insurance contracts or other funding arrangements, and all amendments thereto; (ii) the most recent Forms 5500 and all schedules thereto; (iii) the most recent actuarial report, if any; (iv) the most recent IRS determination letter; (v) the most recent summary plan descriptions; and (vi) written summaries of the material terms of all non-written material Company Benefit Plans.  "Company Benefit Plan" means each bonus, pension, profit sharing, deferred compensation, incentive compensation, stock ownership, stock purchase, stock option, phantom stock or other equity-based retirement, vacation, severance, disability, death benefit, hospitalization, medical or other employee benefit plan, program, policy, practice or arrangement, including any "employee benefit plan" as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), whether or not subject to ERISA, and each employment, retention, change in control, salary continuation, termination or severance plan, program, policy, practice, arrangement or agreement entered into, maintained, sponsored or contributed to by the Company or any Subsidiary or to which the Company or any Subsidiary has any obligation to contribute or would otherwise reasonably be expected to have any Liability, or otherwise providing benefits to any current, former or future employee, officer or director of the Company or any Subsidiary or to any beneficiary or dependent thereof.  Each Company Benefit Plan that is maintained outside the jurisdiction of the United States (a "Non-US Benefit Plan") is indicated as such on Section 3.9(a) of the Company Disclosure Schedule.

---

---

---

---

---

timely paid and all necessary recordations and certificates in connection with each item of the Company Registered Intellectual Property have been timely filed with the relevant governmental authority except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on the Company.

---

Company and/or its Subsidiaries (as applicable). All employees, agents, contractors, and freelancers (in each foregoing case, both current and former) who have or had access to material Trade Secrets of the Company have executed binding confidentiality agreements with respect to the confidentiality of such material Trade Secrets.

---

---

---

loans and advances to employees of the Company or any of its Subsidiaries in the ordinary course of business;

All contracts of the types referred to in clauses (i) through (xv) above (whether or not set forth on Section 3.19 of the Company Disclosure Schedule) are referred to herein as "Company Material Contracts."  The Company has made available to Parent or its Representatives prior to the date of this Agreement a complete and correct copy of each Company Material Contract as in effect on the date of this Agreement.

 

---

violation of or default in any respect under the terms of any Company Material Contract and, to the knowledge of the Company, no event has occurred or not occurred through the Company's or any of its Subsidiaries' action or inaction or through the action or inaction of any third party, that with notice or the lapse of time or both would constitute a breach or violation of or default under the terms of any Company Material Contract, in each case except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Company.  To the knowledge of the Company, each Company Material Contract (i) is a valid and binding obligation of the Company or the Subsidiary of the Company that is party thereto and of each other party thereto, and (ii) is in full force and effect, subject to the Enforceability Exceptions.  There are no disputes pending or, to the Company's knowledge, threatened with respect to any Company Material Contract and neither the Company nor any of its Subsidiaries has received any written notice of the intention of any other party to a Company Material Contract to terminate for default, convenience or otherwise any Company Material Contract, nor to the Company's knowledge, is any such party threatening to do so, in each case except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Company.

 

---

design or routing and any "back door," "time bomb," "Trojan horse," "worm," "drop dead device," "virus," "harmful code," or other software routines or hardware components that in each case permit unauthorized access or the unauthorized disablement or unauthorized erasure of any Company Product or any product or system incorporating a Company Product (or parts thereof) or any associated data or other software, except as would not reasonably be expected to have a Material Adverse Effect on the Company. No open source software, freeware or other software distributed under similar licensing, copyleft, or use/distribution models has been incorporated into any of the software or application comprising or included in any Company Products or Company Material Intellectual Property that, as utilized in the business of the Company as currently conducted, would obligate the Companies and or its Subsidiaries to disclose free of charge to any persons the source code for any proprietary software or proprietary application comprising or included in Company Products or Company Material Intellectual Property.   Further, the Company and its subsidiaries have not and are not in violation of any open source license agreements.  Notwithstanding the foregoing, the representations made in this Section 3.22 shall be to the Company's knowledge with respect to any aspects of the Company Products that are licensed by, or are a service provided by, a third party.

 

---

transactions contemplated thereby, nor the Company's or the Subsidiaries' collection, disclosure to Parent, possession, or use of any Personal Data or any data or information in company databases, will result in any material violation or breach of any Company Privacy Policy, except as would not reasonably be expected to have a Material Adverse Effect on the Company.  None of the disclosures made or contained in any Company Privacy Policy has been inaccurate, misleading or deceptive or in violation of any applicable Law regarding the privacy of users of any website or service operated by or on behalf of the Company or any Subsidiary in any material respects (including containing any material omission).

---

Section 3.27   Web Practices. Neither the Company nor any of its Subsidiaries have ever engaged in or, to the Company's knowledge, have been the subject of any computer hacking or any tactics that are illegal or materially violate the rules and regulations of search engines and (b) to the Company's knowledge, no search engine has removed, penalized or otherwise asserted any written claim against the Company, any of its Subsidiaries or any of the Company's website(s) alleging that the Company or any of its Subsidiaries have engaged in such tactics.  To the knowledge of the Company, there are no links back to the Company's website(s) that the Company or any of its Subsidiaries would consider harmful or inconsistent with their business objectives.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB

Except as disclosed in (i) the Parent SEC Documents publicly filed under Sections 13(a), 14(a) or 15(d) of the Exchange Act since January 1, 2014 and prior to the date hereof (excluding any disclosures set forth in any such Parent SEC Document in any risk factor section, any disclosure in any section relating to forward-looking statements or any other statements that are similarly predictive or forward-looking in nature, in each case, other than any specific factual information contained therein), where the relevance of the information to a particular representation is readily apparent on the face of such disclosure or (ii) the disclosure schedule delivered by Parent to the Company immediately prior to the execution of this Agreement (the "Parent Disclosure Schedule") (provided that disclosure in any section of such Parent Disclosure Schedule shall apply only to the corresponding section of this Agreement except to the extent that it is readily apparent on the face of such disclosure that such disclosure applies to another representation), Parent and Merger Sub jointly and severally represent and warrant to the Company as follows:

---

authority to own, lease and operate its properties and assets and to carry on its business as presently conducted. Merger Sub is a limited liability company duly formed, validly existing and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to own, lease and operate its properties and assets and to carry on its business as presently conducted.  Each of Parent's Subsidiaries is a legal entity duly organized, validly existing and in good standing under the Laws of its respective jurisdiction of organization (with respect to jurisdictions that recognize such concept) and has all requisite corporate or similar power and authority to own, lease and operate its properties and assets and to carry on its business as presently conducted. Each of Parent and its Subsidiaries is duly qualified or licensed, and has all necessary governmental approvals, to do business and is in good standing in each jurisdiction (with respect to jurisdictions that recognize such concept) in which the property owned, leased or operated by it or the nature of the business conducted by it makes such approvals, qualification or licensing necessary, except where the failure to be so duly approved, qualified or licensed and in good standing has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on Parent.  Parent's bank Subsidiaries, Comenity Bank and Comenity Capital Bank, are excluded from the definition of "bank" in Section 2(c) of the Bank Holding Company Act of 1956 (12 U.S.C. 1841(c)), as amended.

(c)            The authorized capital stock of Parent consists of 200,000,000 shares of common stock, par value $0.01 per share (the "Parent Common Stock"), and 20,000,000 shares of preferred stock, par value $0.01 per share (the "Parent Preferred Stock").  As of June 30, 2014, (i) 55,877,640 shares of Parent Common Stock were issued and outstanding (not including shares held in treasury), (ii) 45,708,229 shares of Parent Common Stock were held in treasury, (iii) no shares of Parent Preferred Stock were issued or outstanding and (iv) 22,503,000 shares of Parent Common Stock were reserved for issuance under the Parent Stock Plans, of which amount (A) 195,101 shares of Parent Common Stock are subject to outstanding options, (B) no shares of Parent Common Stock are subject to outstanding restricted stock awards, and (C) 850,280 shares of Parent Common Stock are subject to outstanding time- and performance-vesting restricted stock unit awards (assuming satisfaction of any performance vesting conditions at maximum levels), (v) 1,500,000 shares of Parent Common Stock were reserved for issuance under each of Alliance Data Systems 401(k) and Retirement Savings Plan and Alliance Data Systems Corporation Amended and Restated Employee Stock Purchase Plan; and (vi) no other shares of capital stock or other voting securities of Parent were issued, reserved for issuance or outstanding.  All outstanding shares of Parent Common Stock are, and shares of Parent Common 36

Stock issued or reserved for issuance in connection with the Merger, when issued in accordance with the respective terms thereof, will be, duly authorized, validly issued, fully paid and nonassessable and free of preemptive rights. Except as set forth in this Section 4.1(c), as of June 30, 2014, there are no outstanding subscriptions, options, warrants, calls, convertible securities, exchangeable securities or other similar rights, agreements or commitments to which Parent or any of its Subsidiaries is a party (A) obligating Parent or any of its Subsidiaries to (1) issue, transfer, exchange, sell or register for sale any shares of capital stock or other equity interests of Parent or any Subsidiary of Parent or securities convertible into or exchangeable for such shares or equity interests, (2) grant, extend or enter into any such subscription, option, warrant, call, convertible securities or other similar right, agreement or arrangement relating to the capital stock or other equity interest of Parent or any Subsidiary of Parent, (3) redeem or otherwise acquire any such shares of capital stock or other equity interests of Parent or its Subsidiaries, (4) provide a material amount of funds to, or make any material investment (in the form of a loan, capital contribution or otherwise) in, any Subsidiary that is not a wholly owned Subsidiary of Parent or (5) make any payment to any person the value of which is derived from or calculated based on the value of Parent Common Stock or Parent Preferred Stock or (B) granting any preemptive or antidilutive or similar rights with respect to any security issued by Parent or its Subsidiaries.  As of the date hereof, neither Parent nor any of its Subsidiaries has outstanding any bonds, debentures, notes or other indebtedness, the holders of which have the right to vote (or which are convertible or exchangeable into or exercisable for securities having the right to vote) with the stockholders of Parent on any matter.  There are no voting trusts or other agreements or understandings to which Parent or any of its Subsidiaries is a party with respect to the voting or registration of the capital stock or other equity interest of Parent or any of its Subsidiaries.

 

---

supplements thereto and declaration of effectiveness of the S-4, (vi) the Exchange Act, (vii) the Securities Act, (viii) applicable state securities, takeover and "blue sky" laws, (ix) the HSR Act and any applicable international antitrust requirements and (x) the approvals set forth in Section 4.2(b) of the Parent Disclosure Schedule (subclauses (i) through (vi), the "Parent Approvals"), no authorization, waiver, consent, order, license, permit or approval of, or registration, declaration, notice or filing with, any Governmental Entity is necessary, under applicable Law, for the consummation by Parent or Merger Sub of the transactions contemplated by this Agreement, other than such authorizations, waivers, consents, orders, licenses, permits, approvals, registrations, declarations, notices and filings the failure of which to obtain or make, as applicable, would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect on Parent.

---

statements therein, in light of the circumstances under which they were made, not misleading. As of the date of this Agreement, no executive officer of Parent has failed in any respect to make the certifications required of him or her under Section 302 or 906 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act.  There are no outstanding or unresolved comments in any comment letters of the staff of the SEC received by Parent relating to the Parent SEC Documents.  None of the Parent SEC Documents are, to the knowledge of Parent, the subject of ongoing SEC review.

---

other employees who have a significant role in Parent's internal control over financial reporting, and each such deficiency, weakness and fraud so disclosed to auditors, if any, has been disclosed to Parent prior to the date hereof.  To the knowledge of Parent, there is no reason to believe that Parent's outside auditors and its chief executive officer and chief financial officer will not be able to give the certifications and attestations required pursuant to the rules and regulations adopted pursuant to Section 404 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act, without additional qualification, when next due.

 

---

and effect, are not subject to any administrative or judicial proceeding that could result in any modification, termination or revocation thereof, except where the failure to be valid or in full force and effect would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on Parent.  Parent and its Subsidiaries are in compliance with the terms and requirements of all Parent Permits, and to Parent's knowledge no suspension or cancellation of any such Parent Permit is threatened, in each case except as would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on Parent.

---

---

not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on Parent.  To the knowledge of Parent, each Parent Material Contract (i) is a valid and binding obligation of Parent or the Subsidiary of Parent that is party thereto and of each other party thereto, and (ii) is in full force and effect, subject to the Enforceability Exceptions.  There are no disputes pending or, to Parent's knowledge, threatened with respect to any Parent Material Contract and neither Parent nor any of its Subsidiaries has received any written notice of the intention of any other party to a Parent Material Contract to terminate for default, convenience or otherwise any Parent Material Contract, nor to the Parent's knowledge, is any such party threatening to do so, in each case except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on Parent.

---

the transactions contemplated by this Agreement, including information conveyed at management presentations, in virtual data rooms, or in due diligence sessions.

ARTICLE V

COVENANTS AND AGREEMENTS

---

---

---

---

transactions or make any representations or issue any communications to employees that, in each case, are inconsistent with this Agreement or the transactions, including any representations regarding offers of employment from Parent; or

---

documents that such party is not permitted to disclose under applicable Law), (ii) a copy of all correspondence between such party or any of its Subsidiaries and any party to a Contract with regard to any action, consent, approval or waiver that is required to be taken or obtained with respect to such Contract in connection with the consummation of the Merger or the other transactions contemplated by this Agreement and (iii) all other information concerning its business, properties and personnel as Parent may reasonably request.  All access pursuant to this Section 5.2(a) shall be conducted in such a manner as not to interfere unreasonably with the normal operations of the Company or any of its Subsidiaries.

---

---

---

---

that (i) a bona fide, unsolicited Company Takeover Proposal that did not result from the Company's or its Representatives' breach or violation of, or  failure to perform this Section 5.3 constitutes a Company Superior Proposal and (ii) the failure to make a Company Adverse Recommendation Change, or terminate this Agreement and enter into a definitive agreement relating to such Company Superior Proposal, would be inconsistent with the Company Board of Directors' fiduciary duties under applicable Law, the Company Board of Directors may, subject to compliance with this Section 5.3(f), make a Company Adverse Recommendation Change or cause the Company to terminate this Agreement in order to enter into a definitive agreement relating to such Company Superior Proposal upon (and subject to) paying the Company Termination Fee in accordance with Section 7.3; provided, however, that prior to making such Company Adverse Recommendation Change or so terminating this Agreement: (A) the Company has given Parent at least five Business Days' prior written notice of its intention to take such action, and specifying the reasons therefor, including the terms and conditions of, and the identity of the person making, any such Company Superior Proposal and has contemporaneously provided to Parent a copy of the Company Superior Proposal, a copy of any proposed Company Acquisition Agreements and a copy of any financing commitments relating thereto (or, in each case, if not provided in writing to the Company, a written summary of the terms thereof), (B) the Company has negotiated, and has caused its Representatives to negotiate, in good faith with Parent during such notice period, to the extent Parent wishes to negotiate, to enable Parent to propose revisions to the terms of this Agreement such that it would cause such Company Takeover Proposal to no longer constitute a Company Superior Proposal, (C) upon the end of such notice period, the Company Board of Directors shall have considered in good faith any revisions to the terms of this Agreement proposed in writing by Parent, and shall have determined, after consultation with its financial advisor and outside legal counsel, that such Company Takeover Proposal would nevertheless continue to constitute a Company Superior Proposal if the revisions proposed by Parent were to be given effect and that the failure to make a Company Adverse Recommendation Change or terminate this Agreement and enter into a definitive agreement relating to such Company Superior Proposal, would be inconsistent with the directors' fiduciary duties under applicable Law, and (D) in the event of any change to any of the financial terms (including the form, amount and timing of payment of consideration) or any other material terms of such Company Takeover Proposal, the Company shall, in each case, have delivered to Parent an additional notice consistent with that described in clause (A) above of this proviso and a new notice period under clause (A) of this proviso shall commence (except that the five Business Day notice period referred to in clause (A) above of this proviso shall instead be equal to the longer of (i) three Business Days in the case of the first such additional notice, and two Business Days for any subsequent additional notice; and (ii) the period remaining under the notice period under clause (A) of this proviso) during which time the Company shall be required to comply with the requirements of this Section 5.3(f) anew with respect to such additional notice, including clauses (A) through (D) above of this proviso.  Notwithstanding the foregoing, in the case of any notice described in this Section 5.3(f) that is provided after 5:00 p.m. Central Time, the notice period shall begin on the following Business Day. Notwithstanding anything to the contrary contained herein, neither the Company nor any Company Subsidiary shall enter into any Company Acquisition Agreement unless this Agreement has been terminated in accordance with its terms (including the payment of the Termination Fee pursuant to Section 7.3(a), if applicable).

---

 

---

Merger for offering or sale in any jurisdiction, or any oral or written request by the SEC for amendment of the Proxy Statement/Prospectus or the Form S-4 or comments thereon and responses thereto or requests by the SEC for additional information, and will promptly provide the other with copies of any written communication from the SEC or any state securities commission.  If at any time prior to the Effective Time any information relating to Parent or the Company, or any of their respective Affiliates, officers or directors, is discovered by Parent or the Company which should be set forth in an amendment or supplement to any of the Form S-4 or the Proxy Statement/Prospectus, so that any of such documents would not include a misstatement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, the party that discovers such information shall promptly notify the other parties hereto and an appropriate amendment or supplement describing such information shall be promptly filed with the SEC and, to the extent required by law, disseminated to the Company stockholders.

 

---

pursuant to Section 5.3(f), Parent may require an adjournment or postponement of the Company Stockholders' meeting without the Company's consent only to the extent that (i) the applicable notice period(s) with respect to a notice from the Company pursuant to Section 5.3(e) or 5.3(f) have not expired or been waived, (ii) Parent has made (or intends to make) proposed revisions to this Agreement in response to such a notice within the time period required and (iii) and negotiations pursuant to Section 5.3(e) or 5.3(f) are continuing.  During any such period of adjournment or postponement, the Company shall continue in all respects to comply with its obligations under Section 5.3 and this Section 5.4.

---

plan that provides retiree welfare benefits, (ii) operate to duplicate any benefits of a Company Employee with respect to the same period of service or (iii) apply for purposes of any plan, program or arrangement that is frozen, either with respect to level of benefits or participation. With respect to any Post-Closing Plan that provides medical, dental or vision insurance benefits, for the plan year in which such Company Employee is first eligible to participate, Parent shall (A) cause any pre-existing condition limitations or eligibility waiting periods under such plan  be waived with respect to such Company Employee to the extent such limitation would have been waived or satisfied under the Company Benefit Plan in which such Company Employee participated immediately prior to the Effective Time and (B) credit each Company Employee for an amount equal to any medical, dental or vision expenses incurred by such Company Employee in the Post-Closing Plan year that includes the Closing Date (or, if later, the year in which such Covered Employee is first eligible to participate in such Post-Closing Plan) for purposes of any applicable deductible and annual out-of-pocket expense requirements under any such Post-Closing Plan.  Such credited expenses shall also count toward any annual or lifetime limits, treatment or visit limits or similar limitations that apply under the terms of the applicable plan.

---

administrator of such plan determines to its satisfaction that such rollover is a valid rollover contribution in accordance with Revenue Ruling 2014-9. Nothing in this Agreement shall confer upon any Company Employee or other service provider any right to continue in the employ or service of Parent, the Surviving Company or any Affiliate of Parent, or shall interfere with or restrict in any way the rights of Parent, the Surviving Company or any of their Affiliates, which rights are hereby expressly reserved, to discharge or terminate the services of any Company Employee at any time for any reason whatsoever, with or without cause.  In no event shall the terms of this Agreement be deemed to (i) establish, amend, or modify any Company Benefit Plan or any "employee benefit plan" as defined in Section 3(3) of ERISA, or any other benefit plan, program, agreement or arrangement maintained or sponsored by Parent, Surviving Company, the Company or any of their Subsidiaries (including, after the Closing Date, Company and its Subsidiaries) or Affiliates; or (ii) alter or limit the ability of Parent, the Surviving Company or any of their Subsidiaries (including, after the Closing Date, Company and its Subsidiaries) or Affiliates to amend, modify or terminate any Company Benefit Plan or any other compensation or benefit or employment plan, program, agreement or arrangement after the Closing Date.  Notwithstanding any provision in this Agreement to the contrary, nothing in this Section 5.5 shall create any third party beneficiary rights in any Company Employee or current or former service provider of the Company or its Affiliates (or any beneficiaries or dependents thereof).

---

relationships or contractual rights of Parent or of the Company or any of its Subsidiaries, or to limit its freedom of action with respect to, or its ability to retain, any businesses, assets, relationships or contractual rights of Parent or of the Company or any of its Subsidiaries (or to agree to do the foregoing). Without the prior written consent of Parent, the Company shall not agree or commit to, or permit any of its Subsidiaries to agree or commit to, payment of any material fee, penalty or other consideration or make any other material concession, waiver or amendment under any Contract in connection with obtaining consent under any Contract in connection with obtaining any consent and, if such prior written consent of Parent is not provided, the failure by the Company to take any such action shall not otherwise constitute a breach of this Section 5.6(a).

---

other similarly confidential information, (ii) as necessary to comply with contractual arrangements, and (iii) as necessary to address reasonable privilege concerns.

(c)  The Company and Parent shall use reasonable best efforts to file, as promptly as practicable, all notifications required under the HSR Act and any applicable international antitrust requirements; provided, that notifications required under the HSR Act shall be filed no later than ten (10) Business Days after the date of this Agreement.

 

---

---

which are no less advantageous to the insured) with respect to claims arising from facts or events, or actions or omissions, which occurred or are alleged to have occurred at or before the Effective Time; provided, however, that the Surviving Company shall not be obligated to make annual premium payments in respect of any one policy year for such insurance to the extent such premiums exceed 250% of the annual premiums paid as of the date hereof by the Company for such insurance (the "Premium Cap"), and if such premiums for such insurance would at any time exceed the Premium Cap, then the Surviving Company shall, and Parent shall cause the Surviving Company to, cause to be maintained policies of insurance which, in the Surviving Company's good faith determination, provide the maximum coverage available at an annual premium equal to the Premium Cap.  In lieu of the foregoing, Parent, or the Company after prior consultation with Parent, may obtain at or prior to the Effective Time a six-year prepaid "tail" policy under the Company's existing directors' and officers' insurance policy providing coverage no greater than the current policies of directors' and officers' liability insurance maintained by the Company; provided, that the Company shall not purchase such prepaid "tail" policy for a total cost in excess of 250% of the then current annual premium paid by the Company for such insurance (the "Tail Cap") without the prior written consent of Parent; provided further that if the total cost for such prepaid "tail" policy exceeds the Tail Cap, then Parent or the Company, after prior consultation with Parent, may obtain a prepaid "tail" policy with the maximum coverage available for a total cost not to exceed the Tail Cap.

 

---

 

---

Adverse Effect on it or which it believes would or would be reasonably likely to give rise to a failure of a condition precedent set forth in Section 6.2(a), Section 6.2(b) or Section 6.2(c) (in the case of Parent or Merger Sub) or Section 6.3(a), Section 6.3(b) or Section 6.3(c) (in the case of the Company); provided, that any failure to give notice in accordance with the foregoing shall not be deemed to constitute the failure of any condition set forth in Section 6.2 or Section 6.3 to be satisfied, or otherwise constitute a breach or violation of this Agreement by the party failing to give such notice, in each case unless the underlying breach or violation would independently result in a failure of the conditions set forth in Section 6.2 or Section 6.3 to be satisfied.

ARTICLE VI

CONDITIONS TO THE MERGER

 

---

---

 

 

---

---

to perform, any representation, warranty, covenant, obligation or other agreement contained herein);

or given, or subsequently amended in any material respect (upon each such amendment), a statement recommending that stockholders reject such tender offer or exchange offer and affirming the Company Recommendation, (iv) if the Company or its Representatives shall have otherwise materially breached, violated or failed to perform its covenants, obligations or other agreements under Section 5.3, (and, for the avoidance of doubt, a material breach, violation or failure to perform by a Representative of the Company of Section 5.3(a) shall be considered a material breach, violation or failure to perform for purposes of this clause (iv) regardless of whether the Company used its reasonable best efforts in accordance therewith), Section 5.4(a) and Section 5.4(b); and

 

---

of such termination, the Company or any of its Subsidiaries enters into a definitive agreement with respect to any transaction that constitutes a Company Takeover Proposal (a "Company Takeover Transaction") or (2) at any time on or prior to the twelve month anniversary of such termination, the Company or any of its Subsidiaries consummates a Company Takeover Transaction (in the case of both clauses (1) and (2), whether or not involving the same Company Takeover Proposal as that which was the subject of the Pre-Termination Takeover Proposal Event), the Company shall pay Parent the Termination Fee by wire transfer (to an account designated by Parent) in immediately available funds immediately upon (and not later than the same day as) the earlier of entry into a definitive agreement or consummation of such Company Takeover Transaction; provided, that for the purposes of clause (C) only, all references in the definition of Company Takeover Proposal to "15%" shall instead be references to "50%."

 

 

---

ARTICLE VIII

MISCELLANEOUS

 

 

---

therefrom within the State of Delaware (or, if the Delaware Court of Chancery declines to accept jurisdiction over a particular matter, any state or federal court within the State of Delaware) (in addition to any and all other rights and remedies at law or in equity, and all such rights and remedies shall be cumulative, except, in each case, as may be limited by Section 7.3).  In the event any party to this Agreement seeks any remedy referred to in this Section 8.5, such party shall not be required to prove damages or obtain, furnish, provide or post any bond or similar instrument in connection with or as a condition to obtaining any remedy referred to in this Section 8.5 and each party waives any objection to the imposition of such relief or any right it may have to require the obtaining, furnishing, providing or posting of any such bond or similar instrument.  In addition, each of the parties to this Agreement irrevocably agrees that any legal action or proceeding with respect to this Agreement and the rights and obligations arising hereunder, or for recognition and enforcement of any judgment in respect of this Agreement and the rights and obligations arising hereunder brought by the other party hereto or its successors or assigns, shall be brought and determined exclusively in the Delaware Court of Chancery and any state appellate court therefrom within the State of Delaware (or, if the Delaware Court of Chancery declines to accept jurisdiction over a particular matter, any state or federal court within the State of Delaware).  Each of the parties to this Agreement hereby irrevocably submits with regard to any such action or proceeding for itself and in respect of its property, generally and unconditionally, to the personal jurisdiction of the aforesaid courts and agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated by this Agreement in any court other than the aforesaid courts.  Each of the parties to this Agreement hereby irrevocably waives, and agrees not to assert, by way of motion, as a defense, counterclaim or otherwise, in any action or proceeding with respect to this Agreement, (a) any claim that it is not personally subject to the jurisdiction of the above named courts, (b) any claim that it or its property is exempt or immune from jurisdiction of any such court or from any legal process commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (c) to the fullest extent permitted by applicable Law, any claim that (i) the suit, action or proceeding in such court is brought in an inconvenient forum, (ii) the venue of such suit, action or proceeding is improper or (iii) this Agreement, or the subject matter hereof, may not be enforced in or by such courts.  To the fullest extent permitted by applicable Law, each of the parties to this Agreement hereby consents to the service of process in accordance with Section 8.7; provided, however, that nothing herein shall affect the right of any party to serve legal process in any other manner permitted by Law.

 

---

To Parent or Merger Sub:

Alliance Data Systems Corporation

▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇

▇▇▇▇▇ ▇▇▇

▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇

with copies to:

Akin Gump ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ LLP

▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇▇ ▇▇▇▇

▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇

Attention:

▇▇▇▇▇▇ ▇. ▇▇▇▇▇ III, Esq.

Email:

▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇

To the Company:

Conversant, Inc.

▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇

▇▇▇▇▇ ▇▇▇

▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇

Attention:

Chief Financial Officer

Email:

▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇

---

 

---

such amendment or waiver shall by applicable Law or in accordance with the rules and regulations of Nasdaq Global Select Market require further approval of the Company stockholders, the effectiveness of such amendment or waiver shall be subject to the approval of the Company stockholders. Notwithstanding the foregoing, no failure or delay by any party hereto in exercising any right hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise of any other right hereunder.

 

---

is drafted by all the parties, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of authorship of any of the provisions of this Agreement.

 

---

 

---

---

 

 

---

---

market value of any property that is distributed, transferred, or paid (or deemed for federal income tax purposes to have been distributed, transferred or paid) by the Company to its stockholders and that satisfies the requirements set forth in Treasury Regulation Section 1.368-1(e)(1)(ii), and (5) any other cash or property (other than shares of Parent Common Stock) that is transferred, paid or distributed by Parent (or any person related to Parent within the meaning of Treasury Regulation Section 1.368 1(e)(3)) to Company stockholders in exchange for shares of Company Common Stock in connection with the Merger.

---

as do not individually or in the aggregate materially interfere with the present occupancy or use of the Company Leased Real Property (in the case of the Company) or owned real property or leased real property of Parent and its Subsidiaries (in the case of Parent) or otherwise materially impair the business operations of the Company and its Subsidiaries (in the case of the Company) or Parent and its Subsidiaries (in the case of Parent), (E) other Liens being contested in good faith in the ordinary course of business or which do not materially interfere with the present occupancy or use of the affected Company Leased Real Property (in the case of the Company) or the owned real property or leased real property of Parent and its Subsidiaries (in the case of Parent) or otherwise materially interfere with the conduct of or impair the business operations of the Company and its Subsidiaries (in the case of the Company) or Parent and its Subsidiaries (in the case of Parent) and for which adequate reserves (based on good faith estimates of management) have been set aside for payment therefor, (F) Liens securing Indebtedness or liabilities that are reflected in the Company Financial Statements or the Parent Financial Statements, as applicable  or that Parent or its Subsidiaries incurs in the ordinary course of business following the date hereof, (G) non-exclusive outbound licenses of Intellectual Property, and (H) Liens set forth in Section 8.15(b)(29) of the Company Disclosure Schedule or Section 8.15(b)(29) of the Parent Disclosure Schedule.

 

---

Terms		Page
Acceptable Confidentiality Agreement		75
Adjusted Option		10
Adjusted Restricted Stock Award		11
Affiliates		75

 

 

 

 

 

 

 

 

 

 

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered as of the date first above written.

CONVERSANT, INC.

By:  /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇

Name:  ▇▇▇▇ ▇▇▇▇▇▇▇▇

Title: President and Chief Executive Officer

 

 

 

 

 

[Signature Page to Agreement and Plan of Merger]

---

ALLIANCE DATA SYSTEMS CORPORATION

By:  /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇

Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇

Title: President and Chief Executive Officer

 

AMBER SUB LLC

 

By:  /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇

Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇

Title: Vice President and Secretary

 

 

 

[Signature Page to Agreement and Plan of Merger]

 

 

 

---