Exhibit 10.1

 

[Form of Rollover Agreement]

 

 

November 16, 2014

CONFIDENTIAL

 

Vector CH Holdings (Cayman), L.P.

c/o Vector Capital Management, L.P.

One Market Street

Steuart Tower, 23rd Floor

San Francisco, California 94105

 

Re:     Rollover Agreement

 

Ladies and Gentlemen:

 

Reference is made to that Agreement and Plan of Merger, dated as of the date
hereof (as it may be amended from time to time, the “Merger Agreement”), by and
among ChyronHego Corporation, a New York corporation (the “Company”), Vector CH
Holdings (Cayman), L.P., an exempted limited partnership organized under the
laws of the Cayman Islands (“Parent”) and CH Merger Sub, Inc., a New York
corporation and a wholly-owned subsidiary of Parent (“Merger Subsidiary”).
Capitalized terms used but not defined here (this “Rollover Agreement”) have the
meanings ascribed to them in the Merger Agreement. As used herein, the terms
“Parent” and “Merger Subsidiary” shall include any entity to which Parent or
Merger Subsidiary, as applicable, shall assign their respective rights,
interests and obligations under the Merger Agreement in accordance with Section
10.3 thereof. The undersigned and Vector Capital IV L.P. and its affiliates
(“Vector”) and any other persons who invest in Parent are collectively referred
to herein as the “Investors”. This Rollover Agreement is being delivered to
Parent in connection with the execution of the Merger Agreement by Parent,
Merger Subsidiary and the Company.

 

This Rollover Agreement confirms the commitment of the undersigned, subject to
the conditions set forth herein, to transfer, contribute and deliver to Parent
that number of shares of Company Stock as set forth on Exhibit A attached hereto
(but excluding stock options or shares or money received upon exercise of
options) (the “Rollover Shares”) immediately prior to the Effective Time in
exchange for such number of units of equity of Parent with an aggregate original
issue price equal to the product of the Rollover Shares multiplied by the Merger
Consideration (which equity shall be of the class and series set forth on the
Term Sheet (the “Term Sheet”) attached as Exhibit B hereto, the “Subject Equity
Securities”) and shall have an original issue price per unit equal to the
original issue price per unit of all the Investors; provided, however, that the
undersigned’s right to contribute the Rollover Shares in exchange for equity of
Parent shall be subject to the undersigned executing a customary operating and
members agreement (or similar documents) with Vector and any other Investor, on
substantially the terms and conditions set forth in Exhibit B attached hereto.
Immediately following the closing of Merger, there shall not be outstanding any
equity securities of the Parent or any securities or securities convertible or
exchangeable or exercisable for any equity securities of the Parent other than
the equity issued to the undersigned, Vector and the other Investors, except as
set forth on Exhibit C and except for equity issuable as contemplated by the
Term Sheet. For purposes of illustration only, Exhibit C sets forth an example
of the capitalization table based on the assumed total outstanding equity
required to be funded to Parent at Closing.

 

 
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The undersigned’s obligation to transfer, contribute and deliver the Rollover
Shares to Parent is subject to (i) the satisfaction of the conditions or waiver
of such conditions by Parent as set forth in the Merger Agreement and
consummation of the Merger in accordance with the Merger Agreement, (ii) the
representations and warranties of the Parent set forth in this Agreement being
true and correct in all material respects at and as of the Closing as if made at
and as of the Closing, (iii) Parent’s compliance in all material respects with
its obligations hereunder, (iv) the absence of any prohibition against the
consummation of the transactions contemplated hereby by any applicable law,
statute, rule, regulation, judgment or order of any governmental authority of
competent jurisdiction, (v) the completion of the Transactions contemplated by
the Term Sheet substantially in accordance with the Term Sheet, (vi) the
furnishing of funds by Vector to Parent in satisfaction of Vector’s obligations
to Parent under their equity commitment letter in the form provided to the
undersigned, executed on the date hereof, (vii) the execution by the Investors
of the Shareholders Agreement on the terms set forth in the Term Sheet and, with
respect to matters not covered by the Term Sheet, on customary terms, (viii) the
execution by Parent of the registration rights agreement on the terms set forth
in the Term Sheet and, with respect to matters not covered by the Term Sheet, on
customary terms; and (ix) Parent shall have taken such steps as shall be
required to amend its organizational documents to provide for issuance of the
Subject Equity Securities on terms consistent with the Term Sheet and, with
respect to matters not covered by the Term Sheet, on customary terms.

 

The transfer, contribution and delivery of the Rollover Shares will occur
immediately prior to the Closing and contemporaneous with the simultaneous
issuance to the undersigned of the Subject Equity Securities.

 

The undersigned and Parent shall use their commercially reasonable efforts to
cause the conditions above to be satisfied.

 

The undersigned’s obligation to transfer, contribute and deliver the Rollover
Shares will terminate automatically and immediately upon the earliest to occur
of (a) the termination of the Merger Agreement in accordance with its terms and
(b) the agreement by the undersigned and Vector to terminate this Rollover
Agreement.

 

The undersigned’s obligation to transfer, contribute and deliver the Rollover
Shares may not be assigned.

 

The undersigned represents and warrants that (i) the undersigned has the
requisite power, capacity and authority to execute and deliver this letter
agreement and to fulfill and perform its obligations hereunder and (ii) this
letter agreement has been duly and validly executed and delivered by the
undersigned and constitutes a legal, valid and binding agreement of the
undersigned enforceable by the addressees against the undersigned in accordance
with its terms.

 

 
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Parent represents and warrants that:

 

 (i) Parent has the requisite power, capacity and authority to execute and
deliver this letter agreement and to fulfill and perform its obligations
hereunder ;

 

(ii) this letter agreement has been duly and validly executed and delivered by
Parent and constitutes a legal, valid and binding agreement of the undersigned
enforceable by the addressees against the undersigned in accordance with its
terms ;

 

(iii) Parent and each of its subsidiaries, which is directly or indirectly
wholly-owned by Parent, was organized solely for the purpose of effecting the
transactions contemplated by the Merger Agreement and the other Transaction
Documents, and, as of the Effective Time, will have engaged in no activity other
than in connection with such transaction ;

 

(iv) Parent (a) is a “foreign eligible entity” within the meaning of Treasury
Regulations Section 301.7701-3, (b) has made an election pursuant to U.S.
Treasury Regulation 301.7701-3 to be classified as other than an association
taxable as a corporation for U.S. federal income tax purposes, and such election
shall have been made with an effective date not later than the day prior to the
Closing; and

 

(v)Parent is not aware of any reason why the Rollover would be a transaction in
which gain or loss would be recognized for U.S. federal income tax purposes.

 

Parent shall use all reasonable efforts to ensure that the Rollover as a
transaction described in Section 721 of the U.S. Internal Revenue Code of 1986,
as amended, and agree to file all relevant tax returns and information returns
with the taxing authorities in a manner consistent with such treatment.

 

It is the desire and intent of the parties hereto that the provisions of this
Rollover Agreement be enforced to the fullest extent permissible under the
Applicable Law and public policies applied in each jurisdiction in which
enforcement is sought. Accordingly, if any particular provision of this Rollover
Agreement shall be adjudicated by a court of competent jurisdiction to be
invalid, prohibited or unenforceable for any reason, such provision, as to such
jurisdiction, shall be ineffective, without invalidating the remaining
provisions of this Rollover Agreement or affecting the validity or
enforceability of this Rollover Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction. Notwithstanding the
foregoing, if such provision could be more narrowly drawn so as not to be
invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such
jurisdiction, be so narrowly drawn, without invalidating the remaining
provisions of this Rollover Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction.

 

 
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The undersigned represents and warrants that the undersigned has carefully read
this Rollover Agreement; that the undersigned executes this Rollover Agreement
with full knowledge of the contents of this Rollover Agreement, the legal
consequences thereof, and any and all rights which each party may have with
respect to one another; that the undersigned has had the opportunity to receive
independent legal advice with respect to the matters set forth in this Rollover
Agreement and with respect to the rights and asserted rights arising out of such
matters; that the undersigned has been advised to, and has had the opportunity
to, consult with the undersigned’s personal attorney prior to entering into this
Rollover Agreement; and that the undersigned is entering into this Rollover
Agreement of the undersigned’s own free will. The parties agree that this
Rollover Agreement shall not be construed for or against either party in any
interpretation thereof.

 

This Rollover Agreement shall be binding solely on, and inure solely to the
benefit of, the undersigned and Parent and their respective successors and
permitted assigns, and nothing set forth in this letter shall be construed to
confer upon or give to any person other than the undersigned and Parent and
their respective successors and permitted assigns any benefits, rights or
remedies under or by reason of, or any rights to enforce or cause Parent to
enforce, the Commitment or any provisions of this letter.

 

This Rollover Agreement may be enforced by Parent only at the direction of
Vector in its sole discretion and by the undersigned. Parent shall have no right
to enforce this Rollover Agreement unless directed to do so by Vector in its
sole discretion. Neither the Company’s nor Parent’s creditors shall have a right
to enforce this Rollover Agreement or to cause Parent or the Company, on behalf
of Parent, to enforce this Rollover Agreement.

 

This Rollover Agreement may be executed in one or more counterparts, all of
which shall be considered one and the same letter and shall become effective
when one or more counterparts have been signed by each of the parties and
delivered to the other party, it being understood that all parties need not sign
the same counterpart.

 

This Rollover Agreement and all claims or causes of action (whether in contract,
tort or otherwise) that may be based upon, arise out of or relate to this
Rollover Agreement or the negotiation, execution or performance of this Rollover
Agreement shall be construed, performed and enforced in accordance with the Laws
of the State of New York without regard to the conflicts of law rules of such
state.

 

The parties hereto agree that any suit, action or proceeding seeking to enforce
any provision of, or based on any matter arising out of or in connection with,
this Rollover Agreement or the transactions contemplated hereby (whether brought
by any party or any of its Affiliates or against any party or any of its
Affiliates) shall be brought in any federal or state court located in the
Borough of Manhattan, New York City, State of New York, and each of the parties
hereby irrevocably consents to the jurisdiction of such courts (and of the
appropriate appellate courts therefrom) in any such suit, action or proceeding
and irrevocably waives, to the fullest extent permitted by law, any objection
that it may now or hereafter have to the laying of the venue of any such suit,
action or proceeding in any such court or that any such suit, action or
proceeding brought in any such court has been brought in an inconvenient forum.
Process in any such suit, action or proceeding may be served on any party
anywhere in the world, whether within or without the jurisdiction of any such
court. Without limiting the foregoing, each party agrees that service of process
on such party as provided in Section 11.01 of the Merger Agreement shall be
deemed effective service of process on such party.

 

 
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Upon the closing of the contribution of the Rollover Shares to Parent in
connection with this Rollover Agreement and the Closing under the Merger
Agreement, Parent shall reimburse the undersigned for his reasonable documented
third party expenses incurred in connection with this Rollover Agreement.

 

EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL
BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS ROLLOVER
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

 
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Sincerely, 

 

 

 

   

 

 

Stockholder

 

 

 

   

 

 

By: 

   

 

 

 

[Signature page to Rollover Commitment Letter]

 

 

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Accepted and Agreed to as of the date first above written.

 

VECTOR CH HOLDINGS (CAYMAN), L.P.

By its General Partners

 

 

 

VECTOR CAPITAL, L.L.C.  

 

 

 

 

By:

 

 

Name:  

 

Title:  

 

 

 

 

VECTOR CAPITAL, LTD.  

 

 

 

 

By: 

 

 

Name:  

 

Title: