UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

~~of the~~ Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) ~~June 30, 2017~~

July 28, 2017

Xactly Corporation

(Exact name of registrant as specified in its charter)

Delaware

001-37451

11-3744289

(State or other jurisdiction

of incorporation)

(Commission

File Number)

(I.R.S. Employer

Identification No.)

300 Park Avenue, Suite 1700

San Jose, California 95110

(Address of principal executive offices, including zip code)

(408) 977-3132

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒

Item 2.01 Completion of Acquisition or Disposition of Assets.

On July 31, 2017, pursuant to the terms of an Agreement and Plan of Merger, dated as of May 29, 2017, as amended on June 20, 2017 (the “Merger Agreement”), by and among Excalibur Parent, LLC, a Delaware limited liability company (“Parent”), Excalibur Merger Sub, Inc. a Delaware corporation and wholly owned subsidiary of Parent (“Merger Sub”), and Xactly Corporation (“Xactly” or the “Company”), Parent completed the merger, with the Company continuing as the surviving corporation in the merger and becoming a wholly owned subsidiary of Parent (the “Merger”). Parent and Merger Sub were formed by affiliates of Vista Equity Partners Fund VI, L.P., a Cayman Islands exempted limited partnership. Capitalized terms used herein but not otherwise defined have the meaning set forth in the Merger Agreement.

At the Effective Time, each:

(i)

share of common stock, par value $0.001 per share, of the Company (“Company Common Stock”) issued and outstanding as of immediately prior to the Effective Time (other than Owned Company Shares and Dissenting Company Shares) was cancelled and extinguished, and automatically converted into the right to receive cash in an amount equal to $15.65, without interest thereon (the “Per Share Price”);

(ii)

Company Option was cancelled and converted into the right to receive:

(A)

for (1) any Company Option that was vested as of the Effective Time or that vested solely as a result of the consummation of the transactions contemplated by the Merger Agreement (and without any additional action by Xactly, the Board of Directors or a committee thereof) (each, a “Vested Company Option”) and (2) 66 2/3% of the portion of such Company Options that is not a Vested Company Option prior to the application of this clause (2) (each, an “Additional Vesting Company Option”), a cash amount equal to (i) the Per Share Merger Consideration (less the exercise price per share, if any, attributable to such Company Option), multiplied by (ii) the aggregate number of shares of Company Common Stock subject to such Vested Company Option and Additional Vesting Company Option, subject to any required withholding for applicable taxes; and

(B)

for any Company Option that is not a Vested Company Option or an Additional Vesting Company Option (each, an “Unvested Company Option”), a cash amount, without interest, equal to (1) the aggregate number of shares of Company Common stock subject to such Unvested Company Option multiplied by (2) the excess, if any, of the Per Share Merger Consideration over the applicable per share exercise price under such Unvested Company Option, which cash amount will vest and be payable at the same time as the Unvested Company Option for which such cash amount was exchanged would have vested pursuant to its terms, subject to any required withholding for applicable taxes and subject to the holder’s continued employment with the Parent and its affiliates (including Xactly and its subsidiaries) through the applicable vesting dates (such amount, the “Cash Replacement Company Option Amount”); provided, however, that the payment of such Cash Replacement Company Option Amount may be accelerated in the event the holder’s employment with Xactly is (i) terminated without “cause” within twelve months following the Closing Date (provided that this clause (i) will not apply if the following clause (ii) could apply) or (ii) is a party to a change of control severance agreement, offer letter, employment agreement or any other agreement or contract that provides for vesting acceleration of such holder’s Company Options and has a qualifying termination of employment under such agreement, letter, or contract, in each case, subject to the holder satisfying certain conditions; and

(iii)

Company RSU was cancelled and converted into the right to receive:

(A)

for (1) any Company RSU that was vested as of the Effective Time or that vested solely as a result of the consummation of the transactions contemplated by the

Merger Agreement (and without any additional action by Xactly, the Board of Directors or a committee thereof) (each, a “Vested Company RSU”) and (2) 66 2/3% of the portion of each award of Company RSUs that is not a Vested Company RSU prior to the application of this clause (2) (each, an “Additional Vesting Company RSU” and together with the Additional Vesting Company Options, the “Additional Vesting Awards”), a cash amount equal to the Per Share Merger Consideration, subject to any required withholding for applicable taxes; and

(B)

for any Company RSU that is not a Vested Company RSU or an Additional Vesting Company RSU (each, an “Unvested Company RSU”), a cash amount, without interest, equal to (1) the Per Share Merger Consideration multiplied by (2) the total number of shares of Company Common Stock subject to such Unvested Company RSU immediately prior to the Effective Time, which cash amount will vest and be payable at the same time as the Unvested Company RSU for which such cash amount was exchanged would have vested pursuant to its terms, subject to any required withholding for applicable taxes and subject to the holder’s continued employment with the Parent and its affiliates (including Xactly and its subsidiaries) through the applicable vesting dates (such amount, the “Cash Replacement Company RSU Amount”); provided, however, that the payment of such Cash Replacement Company RSU Amount may be accelerated in the event the holder’s employment with Xactly is (i) terminated without “cause” within twelve months following the Closing Date (provided that this clause (i) will not apply if the following clause (ii) could apply) or (ii) is a party to a change of control severance agreement, offer letter, employment agreement or any other agreement or contract that provides for vesting acceleration of such holder’s Company RSUs and has a qualifying termination of employment under such agreement, letter, or contract, in each case, subject to the holder satisfying certain conditions.

Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

The information set forth under Item 2.01 is incorporated herein by reference.

In connection with the closing of the Merger, the Company notified The New York Stock Exchange (“NYSE”) on July 31, 2017 that each outstanding share of Common Stock (except as described in Item 2.01 hereof) was converted pursuant to the Merger Agreement as set forth under Item 2.01, and requested that NYSE file a Form 25 with the Securities and Exchange Commission (the “SEC”) to remove the Common Stock from listing on NYSE and to deregister the Company Common Stock pursuant to Section 12(b) of the Securities Exchange Act of 1934, as amended.

Item 3.03 Material Modification to Rights of Security Holders.

The information set forth under Item 2.01 is incorporated herein by reference.

Pursuant to the Merger Agreement and in connection with the consummation of the Merger, each outstanding share of Company Common Stock (except as described in Item 2.01 hereof) was converted into the right to receive the Per Share Price.

Item 5.01 Changes in Control of Registrant.

The information set forth under Item 2.01 and Item 3.01 is incorporated herein by reference.

As a result of the Merger, a change in control of the Company occurred, and the Company became a wholly-owned subsidiary of Parent. The total amount of consideration payable to the Company’s equityholders in connection with the Merger was approximately $564 million. The funds used by Parent to consummate the Merger and complete the related transactions came from equity contributions from Vista Equity Partners Fund VI, L.P., the Company’s cash on hand, and the proceeds received in connection with debt financing pursuant to a

$175 million senior secured term loan and a revolving line of credit of up to $15 million under the Credit Agreement, dated as of July 31, 2017, by and among Parent, Merger Sub, Xactly, certain domestic subsidiaries of the Company, as guarantors, the lenders from time to time party thereto, and Goldman Sachs Middle Market Lending Corp., as administrative agent and collateral agent.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangement.

The information set forth under Item 2.01 is incorporated herein by reference.

Effective upon completion of the Merger, the following persons, who were the directors of Merger Sub, became directors of the Company: Brian N. Sheth, Christian B. Sowul, and Jeff Wilson. Christopher W. Cabrera, who was a director of the Company immediately prior to the Merger, will continue to be a director of the Company. The following persons, who were directors of the Company prior to the completion of the Merger, are no longer directors of the Company: Earl E. Fry, Scott A. McGregor, Carol G. Mills, Gerald S. Casilli, Neal Dempsey and Lauren P. Flaherty.

Effective upon completion of the Merger, the following persons, who were the officers of Merger Sub, became officers of the Company: Brian N. Sheth, Christian B. Sowul and Jeff Wilson. Christopher W. Cabrera, Joseph C. Consul and L. Evan Ellis, Jr., who were officers of the Company immediately prior to the Merger, will continue to be officers of the Company.

Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

The information set forth under Item 2.01 is incorporated herein by reference.

Effective upon completion of the Merger, the certificate of incorporation of the Company, as in effect immediately prior to the Merger, was amended and restated to be in the form of the certificate of incorporation attached as Exhibit 3.1, which is incorporated herein by reference.

Effective upon completion of the Merger, the bylaws of the Company were amended and restated to be in the form of the bylaws attached as Exhibit 3.2, which is incorporated herein by reference.

Item 5.07 Submission of Matters to a Vote of Securities Holders.

On July 28, 2017, the Company held a special meeting of stockholders (the “Special Meeting”) at the Company’s principal executive offices in San Jose, California.

As of the record date, June 28, 2017, there were 32,212,469 shares of Company Common Stock eligible to be voted at the Special Meeting. At the Special Meeting, 26,742,291 shares, or approximately 83.01% of all outstanding shares of Company Common Stock, were present either in person or by proxy. Two matters were voted upon at the special meeting, with the Company’s Board of Directors recommending a vote “FOR” in connection with each of the proposals voted upon, as further described in the definitive proxy statement filed with the SEC on June 29, 2017 and as supplemented on July 20, 2017 (the “Definitive Proxy Statement”).

Proposal No. 1 (the “Merger Proposal”) was to consider and vote on the proposal to adopt the Merger Agreement.

Proposal No. 2 (the “Adjournment Proposal”) was to consider and vote on any proposal to adjourn the Special Meeting to a later date or dates if necessary or appropriate to solicit additional proxies if there were insufficient votes to adopt the Merger Agreement at the time of the Special Meeting. Since there were sufficient votes cast at the Special Meeting to adopt the Merger Agreement, a second proposal to adjourn the Special Meeting, if needed or appropriate, to solicit additional proxies was rendered moot.

The Merger Proposal and Adjournment Proposal were approved. The table below shows the final voting results from the Special Meeting.


	For		Against		Abstain
Proposal 1 – The Merger Proposal		26,659,230		27,396		55,665
Proposal 2 – The Adjournment Proposal		25,850,288		832,138		59,865

Item 8.01 Other Events.

AsOn ~~previously announced~~July 31, ~~Xactly Corporation~~2017, ~~a Delaware Corporation (“Xactly” or~~ the “Company~~”),~~ ~~entered~~issued ~~into~~a anpress ~~Agreement and~~release ~~Plan~~announcing ofthe ~~Merger,~~completion ~~dated~~of ~~May 29, 2017, as amended on June 20, 2017 (~~the “Merger ~~Agreement”) with Excalibur Parent, LLC (“Parent”) and Excalibur Merger Sub, Inc~~. ~~(“Merger~~A ~~Sub),~~copy ~~providing for the merger~~ of ~~Merger Sub with and into~~ the ~~Company~~press ~~(the~~release ~~“Merger”),~~is ~~with~~attached ~~the Company surviving the Merger~~ as Exhibit a99.1 ~~wholly~~and ~~owned~~is ~~subsidiary~~incorporated ofherein ~~Parent~~by reference.

On June 30, 2017, a purported stockholder class action lawsuit captioned Berg v. Xactly Corporation et al., Case No. 4:17-cv-03783, was filed in the United States District Court of the Northern District of California against Xactly, its directors, Parent, Merger Sub and Vista Equity Partners Fund VI, L.P. (“Vista”). The lawsuit alleges, generally, that the Merger offers inadequate consideration to Xactly’s stockholders, and that Xactly and its directors violated Section 14(a) of the Securities Exchange Act of 1934 (the “Exchange Act”), and Rule 14a-9 thereunder by purportedly omitting material information from the proxy statement issued in connection with the Merger. The lawsuit also purports to allege violations of Section 20(a) of the Exchange Act against Xactly’s directors, Parent, Merger Sub and Vista. The lawsuit seeks, among other things, equitable relief that would enjoin the consummation of the proposed Merger, rescission of the proposed Merger to the extent it is consummated, and attorneys’ fees and costs. Additional similar lawsuits may be filed in the future.

The Company believes that the plaintiff’s allegations lack merit and will vigorously defend against this and any subsequently filed similar actions.

Additional Information and Where to Find It

Xactly has filed a definitive proxy statement on Schedule 14A with the Securities and Exchange Commission (the “SEC”) in connection with the proposed Merger. Beginning on June 29, 2017, Xactly mailed the definitive proxy statement and other relevant documents to Xactly stockholders as of the June 28, 2017 record date for a special meeting of stockholders of Xactly to be held on July 28, 2017, at Xactly’s headquarters, located at 300 Park Avenue, Suite 1700, San Jose, California 95110, at 9:00 a.m. Pacific time. The definitive proxy statement described above contains important information about the proposed Merger and related matters. INVESTORS, STOCKHOLDERS AND SECURITY HOLDERS OF XACTLY ARE URGED TO READ THESE MATERIALS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE TRANSACTION THAT XACTLY WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT XACTLY AND THE TRANSACTION. Investors, stockholders and security holders will be able to obtain free copies of these documents and other documents filed with the SEC by Xactly through the website maintained by the SEC at www.sec.gov. In addition, investors, stockholders and security holders will be able to obtain free copies of these documents from Xactly by contacting Xactly’s Investor Relations at (408) 477-3338, by e-mail at ir@xactlycorp.com, or by going to Xactly’s Investor Relations page on its website at investors.xactlycorp.com.

Participants in the Solicitation

The directors and executive officers of Xactly may be deemed to be participants in the solicitation of proxies from the stockholders of Xactly in connection with the proposed Merger. Information regarding the interests of these directors and executive officers in the transaction described herein is set forth in Xactly’s definitive proxy statement on Schedule 14A filed with the SEC on June 29, 2017. Additional information regarding Xactly’s directors and executive officers is also included in Xactly’s proxy statement for its 2017 Annual Meeting of Stockholders, which was filed with the SEC on May 11, 2017. These documents are available free of charge as described in the preceding paragraph.

Legal Notice Regarding Forward-Looking Statements

This Form 8-K contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, but not limited to, statements regarding possible or assumed future results of operations of Xactly, the expected completion and timing of the Merger and other information relating to the Merger. Without limiting the foregoing, the words “believes,” “anticipates,” “plans,” “expects,” “intends,” “forecasts,” “should,” “estimates,” “contemplate,” “future,” “goal,” “potential,” “predict,” “project,” “projection,” “may,” “will,” “could,” “should,” “would,” “assuming” and other words or expressions of similar meaning or import are intended to identify forward-looking statements. You should, therefore, carefully read and consider statements that contain these words or expressions, as such forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those indicated in such forward-looking

statements, including, but not limited to, (i) the risk that the proposed Merger may not be completed in a timely manner or at all, which may adversely affect Xactly’s business and the price of the common stock of Xactly, (ii) the failure to satisfy all of the conditions precedent to the consummation of the proposed Merger, including, but not limited to, the required consent of the stockholders of Xactly and the receipt of certain governmental or regulatory approvals, (iii) the occurrence of any event, change or other circumstance or condition that could give rise to the termination of the merger agreement, (iv) the effect of the announcement or pendency of the transaction on Xactly’s business relationships, operating results and business generally, (v) risks that the proposed transaction disrupts current plans and operations and the potential difficulties in employee retention as a result of the transaction, (vi) risks related to diverting management’s attention from Xactly’s ongoing business operations, (vii) the outcome of any legal proceedings that may be instituted against us related to the merger agreement or the Merger and (viii) such other risks and uncertainties as identified in Xactly’s Annual Report on Form 10-K for the fiscal year ended January 31, 2017 and Quarterly Report on Form 10-Q for the fiscal quarter ended April 30, 2017, as filed with the SEC, which contain and identify important factors that could cause the actual results to differ materially from those contained in the forward-looking statements. Xactly assumes no obligation to update any forward-looking statement contained in this Form 8-K.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

EXHIBIT INDEX


Exhibit No.		Description

3.1		Amended and Restated Certificate of Incorporation of Xactly Corporation.

3.2		Amended and Restated Bylaws of Xactly Corporation.

99.1		Press Release of Xactly Corporation dated July 31, 2017.

Exhibit Number		Description
99.1		Complaint, Berg v. Xactly Corporation et. al., Case No. 4:17-cv-03783 (N.D. Cal. Filed June 30, 2017).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: July 31, 2017


XACTLY CORPORATION

By:		/s/ Christopher W. Cabrera
		Christopher W. Cabrera
		Chief Executive Officer and Director

EXHIBIT INDEX

Exhibit Number		Description
Exhibit No.		Description
99.1		Complaint, Berg v. Xactly Corporation et. al., Case No. 4:17-cv-03783 (N.D. Cal. Filed June 30, 2017).
3.1		Amended and Restated Certificate of Incorporation of Xactly Corporation.
3.2		Amended and Restated Bylaws of Xactly Corporation.
99.1		Press Release of Xactly Corporation dated July 31, 2017.

XACTLY CORPORATION

Date: July 5, 2017

/s/ Joseph C. Consul

Joseph C. Consul

Chief Financial Officer, Assistant Secretary and Treasurer

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