Item 1.01 Entry into a Material Definitive Agreement.
As previously reported, on October 21, 2016, Genworth Financial, Inc. (the “Company”) entered into an agreement and plan of merger (the “Merger Agreement”) with Asia Pacific Global Capital Co., Ltd. (“Parent”), a limited liability company incorporated in the People’s Republic of China and a subsidiary of China Oceanwide Holdings Group Co., Ltd., a limited liability company incorporated in the People’s Republic of China (together with its affiliates, “ChinaOceanwide”), and Asia Pacific Global Capital USA Corporation (“Merger Sub”), a Delaware corporation and a direct, wholly-owned subsidiary of Asia Pacific Insurance USA Holdings LLC (“Asia Pacific Insurance”) which is a Delaware limited liability company and owned by China Oceanwide, pursuant to which, subject to the terms and conditions set forth therein, Merger Sub would merge with and into the Company with the Company surviving the merger as a direct, wholly-owned subsidiary of Asia Pacific Insurance (the “Merger”). In addition to the Merger Agreement, the Company, Parent and Merger Sub have entered into that certain (i) Waiver and Agreement, dated as of August 21, 2017; (ii) Second Waiver and Agreement, dated as of November 29, 2017; (iii) Third Waiver and Agreement, dated as of February 23, 2018; (iv) Fourth Waiver and Agreement, dated as of March 27, 2018; (v) Fifth Waiver and Agreement, dated as of June 28, 2018; (vi) Sixth Waiver and Agreement, dated as of August 14, 2018; (vii) Seventh Waiver and Agreement, dated as of November 30, 2018; (viii) Eighth Waiver and Agreement, dated as of January 30, 2019; (ix) Ninth Waiver and Agreement, dated as of March 14, 2019 and (x) Tenth Waiver and Agreement, dated as of April 29, 2019. Capitalized terms used but not defined in the Current Report on Form8-K have the meanings ascribed to such terms under the Merger Agreement.
On June 30, 2019, the Company, Parent and Merger Sub entered into an Eleventh Waiver and Agreement (the “Waiver Agreement”). Pursuant to the Waiver Agreement, Parent has waived compliance by the Company with certain covenants in the Merger Agreement that would restrict or prohibit the Company from initiating, soliciting or encouraging inquiries or the making of proposals or offers with respect to its interest in Genworth MI Canada Inc. (the “MIC Interest”), engaging in discussions or negotiations regarding the sale of the MIC Interest or providingnon-public information to any Person that has made or is considering making a proposal with respect to the sale of the MIC Interest.
Under the terms of the Waiver Agreement, the Company has agreed to reasonably consult with Parent about the sale of the MIC Interest, including by consulting with Parent with respect to: (i) the engagement of advisers; (ii) the identities of potential buyers of the MIC Interest; (iii) the material terms of any proposals to acquire the MIC Interest; (iv) diligence matters; (v) transaction documents; (vi) press releases; (vii) communications with regulators; and (viii) material costs.
Pursuant to the Waiver Agreement, the Company and Parent each agreed to extend the End Date by waiving its right to terminate the Merger Agreement and abandon the Merger prior to the date that is the earliest to occur of: (i) November 30, 2019; (ii) after the Company has provided Parent a written notice attaching the final drafts of all transaction documents relating to the sale of the MIC Interest, the date that is the earlier to occur of (a) the date on which Parent notifies the Company that it will not approve such transaction documents or (b) the fifth Business Day after the date on which Parent received such notice with such transaction documents unless Parent has previously notified the Company that it approves such transaction documents; or (iii) in the event any Governmental Entity imposes any term, condition, obligation, restriction, requirement, limitation, qualification, remedy or other action that applies to any member of the Parent Group or the Company Group (other than a requirement to provide information regarding the terms of the sale of the MIC Interest or updates to factual information or those that would solely apply to MIC or its Subsidiaries and take effect after the consummation of the sale of the MIC Interest) (each, a “Condition”) in connection with (1) its approval ornon-disapproval of the sale of the MIC Interest or (2) any Parent Approval or Company Approval with respect to the Merger, that (A) is materially and adversely different, individually or in the aggregate, from the Conditions set forth in orders, consents, approvals, permits or authorizations issued by Government Entities with respect to the Mergers that are in effect on the date of the Waiver Agreement, (B) is materially and adversely different, individually or in the aggregate, from the Conditions set forth in such Governmental Entity’s order, consent, approval, permit or authorization with respect to the Merger as in effect on the date of the Waiver Agreement, or (C) would require the Merger to be consummated on terms that are materially and adversely different from those set forth in the filing and applications (as amended) that were reflected prior to the date of the Waiver Agreement in formal submissions to any Governmental Entity and that formed the basis upon which such Governmental Entity theretofore issued its order, consent, approval or authorization with respect to the Merger, including with respect to the funding of the Merger Consideration, the date on which Parent notifies the Company that it will not approve such Condition.
