Item 1.01 Entry into a Material Definitive Agreement.






Agreement and Plan of Merger

On April 28, 2022, GTY Technology Holdings Inc., a Massachusetts corporation (the "Company"), entered into an Agreement and Plan of Merger (the "Merger Agreement") with GI Georgia Midco Inc., a Delaware corporation ("Parent"), and GI Georgia Merger Sub Inc., a Massachusetts corporation and a wholly owned subsidiary of Parent ("Merger Sub"). The Merger Agreement provides, subject to its terms and conditions, for the acquisition of the Company by Parent at a price of $6.30 per share of common stock, par value $0.0001, of the Company (each, a "Share"), in cash, without interest and subject to deduction for any required withholding tax (the "Merger Consideration"), through the merger of Merger Sub with and into the Company (the "Merger"), with the Company surviving the Merger as a wholly owned subsidiary of Parent. Parent and Merger Sub are owned by funds affiliated with GI Partners (collectively, "GI Partners"). The Company's Board of Directors (the "Board") has unanimously approved the Merger and the Merger Agreement and recommended that shareholders of the Company approve the Merger Agreement, and the Company has agreed to hold a meeting of shareholders to submit the Merger Agreement to its shareholders for their consideration.

Pursuant to the Merger Agreement, at the effective time of the Merger (the "Effective Time"):

· each Share that is issued and outstanding immediately prior to the Effective


   Time (other than Shares owned by the Company, Parent or Merger Sub immediately
   prior to the Effective Time (all of which will be cancelled) and Shares held by
   any holder who is entitled to, and who has perfected, appraisal rights under
   Massachusetts law) will be automatically converted into the right to receive
   the Merger Consideration;

· each then-outstanding and unexercised Company stock option will vest in full


   and be surrendered by the holder thereof to the Company in consideration for an
   amount in cash from the Company equal to the total number of Shares subject to
   such Company stock option multiplied by the excess, if any, of the Merger
   Consideration over the exercise price per share of such stock option; provided
   that, in the event that the exercise price of any such stock option is equal to
   or greater than the Merger Consideration, such stock option will be cancelled,
   without any consideration being payable in respect thereof, and have no further
   force or effect;

· each performance-based restricted stock unit of the Company that is then


   outstanding, will vest in full and automatically be cancelled and converted
   into the right to receive the Merger Consideration;

· each time-based restricted stock unit of the Company ("RSU") that is then


   outstanding and would vest within 12 months following the Effective Time will
   vest in full and automatically be cancelled and converted into the right to
   receive the Merger Consideration;

· 50% of the remaining time-based RSUs that are then outstanding (i.e., those


   that would not vest within 12 months following the Effective Time) will vest in
   full and automatically be cancelled and converted into the right to receive the
   Merger Consideration, and the other 50% of the remaining time-based RSUs will
   be cancelled and converted into the right to receive cash-based awards that pay
   out in accordance with the vesting schedules that applied to the time-based
   RSUs that they replaced;

· each issued and outstanding Class A exchangeable share of each of 1176363 B.C.


   Ltd., a company incorporated under the Business Corporations Act (British
   Columbia) and a subsidiary of the Company (Bonfire Exchangeco), and 1176368
   B.C. Ltd., a company incorporated under the Business Corporations Act (British
   Columbia) and a subsidiary of the Company (Questica Exchangeco), will be
   redeemed and exchanged for the right to receive the Merger Consideration; and

· each warrant to purchase Shares (each, a "Warrant") that is then unexercised


   and outstanding will automatically, without any action on the part of the
   holder, cease to represent a warrant to purchase Shares and instead represent a
   right by the holder upon any subsequent exercise to receive the Merger
   Consideration, provided that a holder of a Warrant that properly exercises the
   Warrant within 30 days following the closing of the Merger shall instead be
   entitled to receive the Black-Scholes value of such Warrant.

Concurrently with the entry into the Merger Agreement, the directors and certain officers of the Company, collectively owning approximately 13% of the outstanding Shares, entered into Voting Agreements (collectively, the "Voting Agreements") with Parent. Pursuant to each Voting Agreement, the applicable director or officer has agreed, among other things, in his capacity as a shareholder of the Company, to vote all Shares that he beneficially owns, or which he acquires after the date hereof, in favor of the adoption of the Merger Agreement and against any competing or alternative transaction.

The Merger Agreement contains customary representations and warranties from both the Company, on the one hand, and Parent and Merger Sub, on the other hand. It also contains customary covenants, including covenants providing for each of the Company and Parent to use its reasonable best efforts to cause the Merger to be consummated, and covenants requiring the Company, among other things, (i) to conduct its business in the ordinary course during the interim period between the execution of the Merger Agreement and the Effective Time, (ii) not to engage in specified types of transactions during such period, and (iii) not to solicit proposals or engage in discussions relating to alternative acquisition proposals or change the recommendation of the Board to the Company's shareholders regarding the Merger Agreement, in each case, except as otherwise permitted by the Merger Agreement, including in connection with the compliance by the Board with its fiduciary duties under Massachusetts law.

Completion of the Merger is subject to customary closing conditions, including (i) approval of the Merger Agreement by the Company's shareholders, (ii) the expiration or termination of applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and (iii) the absence of governmental injunctions or other legal restraints prohibiting the Merger. In addition, the obligation of each party to consummate the Merger is conditioned upon, among other things, the accuracy of the representations and warranties of the other party (subject to certain materiality exceptions), and material compliance by the other party with its covenants under the Merger Agreement. Parent's obligations under the Merger Agreement are not subject to any financing condition.

Parent has obtained an equity financing commitment for the purpose of financing the transactions contemplated by the Merger Agreement and paying related fees and expenses. Funds advised by GI Partners have committed, on the terms and subject to the conditions of an equity commitment letter, dated April 28, 2022, to capitalize Parent at closing with aggregate equity contributions needed to fund the transactions contemplated by the Merger Agreement.

The Merger Agreement may be terminated, subject to the terms and conditions of the Merger Agreement, (i) by mutual written consent of Parent and the Company; (ii) by either the Company or Parent if the Merger is not consummated by October 28, 2022 (the "Outside Date"), provided that the Outside Date may be automatically extended in certain circumstances; (iii) by either the Company or Parent, if the requisite approval of the Company's shareholders holding at least 66?% of the Company's outstanding Shares has not been obtained; (iv) by either the Company or Parent, if a governmental injunction or other legal restraint prevents the consummation of the Merger; or (v) by either the Company or Parent upon the other party's uncured material breach of any representation, warranty, covenant or agreement under the Merger Agreement. The Merger Agreement may also be terminated (A) by the Company, in order to enter into a definitive agreement with respect to a superior proposal, subject to specified limitations and payment of the termination fee described below; (B) by the Company, if all conditions to Parent's obligation to close have been met and Parent fails to consummate the Merger within three business days following the receipt of notice from the Company that it is prepared to consummate the Merger; or (C) by Parent, if the Board fails to recommend or changes its recommendation regarding the Merger or approves or recommends an alternative transaction or fails to recommend against an alternative transaction that is a tender offer or is otherwise publicly announced.

If the Merger Agreement is terminated under certain circumstances specified in the Merger Agreement, the Company will be required to pay Parent a termination fee of $12,760,000 (including under specified circumstances in connection with the Company's entry into an agreement with respect to a superior proposal). The Merger Agreement also provides that Parent will be required to pay the Company a reverse termination fee of $29,770,000 under certain specified circumstances set forth in the Merger Agreement. Funds advised by GI Partners have provided the Company with a limited guarantee in favor of the Company guaranteeing Parent's obligation to pay, in certain circumstances, the reverse termination fee and . . .




Item 8.01 Other Events.

On April 29, 2022, the Company and GI Partners issued a joint press release relating to the Merger. A copy of the press release is attached hereto as Exhibit 99.1.

Item 9.01 Financial Statements and Exhibits.






(d)    Exhibits.



Exhibit No.   Description

   2.1†         Agreement and Plan of Merger, dated April 28, 2022, by and among GTY
              Technology Holdings Inc., GI Georgia Midco Inc. and GI Georgia Merger
              Sub Inc.
   99.1         Joint Press Release, dated April 29, 2022
    104       Cover Page Interactive Data File (the cover page XBRL tags are embedded
              in the inline XBRL Document)

† Certain schedules to this exhibit have been omitted pursuant to Item 601(b)(2)

of Regulation S-K. The registrant hereby agrees to furnish a copy of any

omitted schedules to the SEC upon request.

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