Sequence of events before Microsoft acquired LinkedIn

Source: SEC Filing (Page 35–47)

Background of the Merger

On February 16, 2016, Jeff Weiner, LinkedIn’s chief executive officer, met with Satya Nadella, Microsoft’s chief executive officer, to discuss the ongoing commercial relationship between the companies and ways to enhance it. At this meeting, Messrs. Weiner and Nadella discussed ways in which the two companies could work together more closely and, in the context of that discussion, among other things, the concept of a business combination was raised.

On March 10, 2016, Mr. Weiner met with an executive of a company, which we refer to as “Party A,” at the executive’s request. During the meeting, the executive of Party A stated to Mr. Weiner that he and the chief executive officer of Party A had previously discussed ways in which Party A could enhance its business relationship with LinkedIn, as well as a potential acquisition of LinkedIn by Party A.

On March 12, 2016, Mr. Hoffman held a previously scheduled meeting with a senior executive of a company, which we refer to as “Party B.” Later on March 12, 2016, the senior executive of Party B contacted each of Messrs. Hoffman and Weiner separately to set up an additional meeting in the near future to explore a potential business combination transaction.

On March 14, 2016, at a function attended by both Mr. Weiner and the chief executive officer of Party A, Mr. Weiner spoke with the chief executive officer of Party A, who requested that the two speak further about potential strategic opportunities for LinkedIn and Party A.

On March 15, 2016, Mr. Weiner called Mr. Nadella to inquire as to whether Microsoft was interested in discussing further a potential acquisition of LinkedIn, and explained that, although LinkedIn was not for sale, others had expressed interest in an acquisition. Mr. Nadella responded that he had discussed the matter further with Microsoft’s board of directors, confirmed that Microsoft was interested in pursuing an acquisition of LinkedIn and that Microsoft had begun work on the project.

On March 16, 2016, at the request of the chief executive officer of Party A, Mr. Weiner met with the chief executive officer of Party A, who informed Mr. Weiner that Party A had engaged a financial advisor for purposes of analyzing a potential acquisition of LinkedIn by Party A and that Party A was interested in pursuing an acquisition. The chief executive officer of Party A also discussed with Mr. Weiner the current business of Party A and the potential benefits of a combination of Party A and LinkedIn.

On March 18, 2016, the LinkedIn Board met, with representatives of LinkedIn management and Wilson Sonsini Goodrich & Rosati, Professional Corporation, outside legal counsel to LinkedIn, which we refer to as “Wilson Sonsini,” in attendance. The members of the LinkedIn Board discussed the recent indications of interest with respect to a potential acquisition of LinkedIn from Party A, Party B and Microsoft. The members of the LinkedIn Board also discussed contacting other companies that may have an interest in acquiring LinkedIn. The representatives of Wilson Sonsini discussed with the members of the LinkedIn Board their fiduciary duties in the context of a potential sale of LinkedIn. The representatives of Wilson Sonsini also discussed with the members of the LinkedIn Board the fiduciary and other considerations related to the fact that Mr. Hoffman, through his ownership of Class B common stock, controlled more than a majority of the outstanding voting power of LinkedIn and therefore would be able to approve or prevent any potential transaction. Mr. Hoffman informed the other members of the LinkedIn Board that, should such a transaction proceed, he expected to be treated the same as the other stockholders of LinkedIn and would not expect to receive, or seek to receive, any special or different consideration. In light of the potentially significant workload involved in exploring strategic alternatives and the possibility that in connection with such exploration LinkedIn management might need feedback and direction on relatively short notice, the LinkedIn Board created a transactions committee, which we refer to as the “Transactions Committee.” The Transactions Committee was authorized to advise and direct LinkedIn management with respect to the exploration, consideration and negotiation of strategic alternative transactions, to facilitate negotiation, and to report to the LinkedIn Board on a regular basis. The LinkedIn Board retained authority to approve any transaction. The LinkedIn Board appointed A. George “Skip” Battle, Michael Moritz and Stanley Meresman to the Transactions Committee. The LinkedIn Board also authorized the Company to engage Qatalyst Partners, on terms acceptable to the Transactions Committee, to assist LinkedIn with respect to its exploration of strategic alternative transactions.

Later on March 18, 2016, Mr. Weiner attended a meeting previously scheduled by Qatalyst Partners. During the meeting, Mr. Weiner spoke with a representative of Qatalyst Partners about potentially engaging Qatalyst Partners to act as LinkedIn’s financial advisor for purposes of assisting with the exploration of strategic alternative transactions.

On March 21, 2016, the chief executive officer of Party A emailed Mr. Weiner to inquire about meeting to further discuss a potential acquisition.

On March 22, 2016, Mr. Weiner emailed the chief executive officer of Party A and said, in response to Party A’s inquiry, that LinkedIn would be willing to meet to further discuss a potential acquisition. Mr. Weiner also emailed with an executive of Party B regarding the possibility of a transaction with LinkedIn and to set up further meetings on the topic. Additionally, Mr. Weiner emailed Mr. Nadella to set up a call to further discuss a potential acquisition.

Later on March 22, 2016, Mr. Weiner spoke with Mr. Nadella about a meeting to discuss a potential acquisition. Later that day, the Transactions Committee held its first meeting, with Mr. Hoffman and representatives of LinkedIn management, Qatalyst Partners and Wilson Sonsini, respectively, in attendance. The Transactions Committee discussed the current status of discussions with third parties regarding a potential acquisition of LinkedIn. The Transactions Committee also reviewed other parties that might have an interest in a transaction with LinkedIn, based on the Transactions Committee’s assessment of the likelihood these parties would be interested in making a compelling offer for LinkedIn that was capable of being completed, and, among other things, authorized Mr. Weiner and Qatalyst Partners to contact a company, which we refer to as “Party C,” regarding a potential acquisition of LinkedIn. The Transactions Committee approved the engagement by LinkedIn of Qatalyst Partners as a financial advisor.

On March 25, 2016, Messrs. Hoffman and Weiner met with the chief executive officer of Party A and discussed aspects of a potential transaction with LinkedIn, including potential benefits of an acquisition. The chief executive officer of Party A stated that Party A would like Mr. Weiner to play a role at the combined company if Party A acquired LinkedIn. The chief executive officer of Party A and Mr. Hoffman also briefly discussed Mr. Hoffman’s potential involvement with the business following a transaction, including, among other things, his possibly serving on Party A’s board of directors.

On March 28, 2016, Mr. Weiner spoke to the chief executive officer of Party C regarding a potential acquisition of LinkedIn.

On March 29, 2016, representatives of Qatalyst Partners discussed a potential transaction with a representative of the corporate development department and another senior executive of Party C.

Also on March 29, 2016, Messrs. Hoffman and Weiner met with the chief executive officer and another senior executive of Party B to discuss, among other things, potential benefits of an acquisition.

On March 31, 2016, Messrs. Hoffman and Weiner and Steve Sordello, LinkedIn’s senior vice president and chief financial officer, met with Mr. Nadella and other executives of Microsoft to discuss, among other things, potential benefits of an acquisition.

On April 1, 2016, the Transactions Committee met, with Mr. Hoffman and representatives of LinkedIn management, Qatalyst Partners and Wilson Sonsini, respectively, in attendance. Mr. Weiner updated the Transactions Committee regarding the status of the recent discussions concerning a potential acquisition of LinkedIn, as well as other parties who might have interest in an acquisition of LinkedIn. At this meeting, Mr. Hoffman informed the Transactions Committee that he had a meeting scheduled with the chief executive officer of another company, which we refer to as “Party D,” who might have an interest in a transaction with LinkedIn in the near future. The Transactions Committee authorized Mr. Hoffman to gauge Party D’s interest in a transaction.

Later on April 1, 2016, representatives of Wilson Sonsini provided Party A with a draft of a confidentiality agreement. The confidentiality agreement was signed on April 6, 2016.

On April 2, 2016, representatives of the corporate development department of Party C contacted representatives of Qatalyst Partners and informed them that Party C was not interested in pursuing an acquisition of LinkedIn, but remained interested in potential alternative transactions or a commercial partnership with LinkedIn.

On April 4, 2016, a senior executive of Party B contacted Mr. Weiner and indicated that Party B was interested in exploring a potential acquisition of LinkedIn, and that representatives from their corporate development team would contact Qatalyst Partners.

On April 5, 2016, representatives of Wilson Sonsini provided Party B with a draft of a confidentiality agreement. The confidentiality agreement was signed on April 11, 2016.

On April 6, 2016, Messrs. Weiner and Sordello and representatives of Qatalyst Partners held a due diligence meeting with members of the management team of Party A and their advisors, including the chief executive officer and chief financial officer of Party A.

Also on April 6, 2016, representatives of Wilson Sonsini provided Microsoft with a draft of a confidentiality agreement. The confidentiality agreement was signed on April 11, 2016.

On April 7, 2016, Mr. Hoffman attended a previously scheduled meeting with the chief executive officer of Party D. During the course of this meeting, Mr. Hoffman described that LinkedIn had received interest in a potential acquisition. The chief executive officer of Party D informed Mr. Hoffman that Party D was not interested in exploring a business combination transaction with LinkedIn at that time.

On April 11, 2016, LinkedIn management, including, among others, Mr. Sordello and Mike Callahan, LinkedIn’s senior vice president, general counsel and secretary, and representatives of

Qatalyst Partners held a due diligence call with representatives of Microsoft’s management, corporate development and legal teams and representatives of Simpson Thacher & Bartlett LLP, outside legal counsel to Microsoft, which we refer to as “Simpson Thacher.”

On April 12, 2016, LinkedIn management, including Mr. Sordello, and representatives of Qatalyst Partners held a due diligence call with representatives of Party A management and its advisors.

On April 13, 2016, LinkedIn management, including Messrs. Weiner, Sordello and Callahan, and representatives of Qatalyst Partners, held a due diligence video call with representatives of Microsoft, including Mr. Nadella, and representatives of Simpson Thacher and Morgan Stanley & Co. LLC, financial advisor to Microsoft, which we refer to as “Morgan Stanley.”

On April 14, 2016, representatives of LinkedIn management, including Messrs. Weiner, Sordello and Callahan, and representatives of Qatalyst Partners held a due diligence meeting with executives, representatives and advisors of Party B.

On April 18, 2016, the Transactions Committee met, with Mr. Hoffman and representatives of LinkedIn management, Qatalyst Partners and Wilson Sonsini, respectively, in attendance. Mr. Weiner updated the Transactions Committee on the status of discussions. The representatives of Qatalyst Partners informed the members of the Transactions Committee that Party C had informed Qatalyst Partners that Party C was not interested in pursuing an acquisition of LinkedIn at that time and had proposed an alternative transaction. Mr. Hoffman informed the members of the Transactions Committee that Party D was not interested in pursuing an acquisition of LinkedIn at that time. The members of the Transactions Committee then discussed the potential engagement of Allen & Company LLC, which we refer to as “Allen,” to serve as an additional financial advisor to LinkedIn based on Allen’s relevant industry experience, contacts and familiarity with LinkedIn and its business. After discussion, the Transactions Committee authorized LinkedIn management to proceed with the engagement of Allen, on the terms discussed with the Transactions Committee.

On April 19, 2016, Mr. Sordello and representatives of Qatalyst Partners conducted a due diligence call with representatives of Microsoft and Morgan Stanley.

On April 20, 2016, a senior representative of Party B contacted Mr. Hoffman to discuss the status of Party B’s interest in an acquisition of LinkedIn and the potential benefits for Party B associated with an acquisition of LinkedIn.

On April 25, 2016, Messrs. Hoffman and Weiner each had a conversation with the chief executive officer of Party A regarding Party A’s interest in a transaction. The chief executive officer of Party A stated that Party A was preparing a proposal to acquire LinkedIn.

Later on April 25, 2016, Party A submitted a non-binding indication of interest to acquire LinkedIn for a price between $160 to $165 per share of LinkedIn common stock, with such consideration to be a mix of cash and Party A common stock, with up to 50% of such consideration being in cash. Party A’s indication of interest also requested that LinkedIn enter into an exclusivity agreement.

On April 26, 2016, the Transactions Committee met, with representatives of LinkedIn management, Qatalyst Partners and Wilson Sonsini, respectively, in attendance. The Transactions Committee discussed the proposal from Party A, as well as the status of discussions with Microsoft and Party B. The Transactions Committee discussed the process for obtaining additional indications of interest.

On April 27, 2016, representatives of Qatalyst Partners had a conversation with representatives of Party B regarding the status of Party B’s interest in an acquisition of LinkedIn.

On April 29, 2016, Mr. Weiner spoke with Mr. Nadella and reviewed the status of discussions with Microsoft regarding an acquisition of LinkedIn.

On May 3, 2016, representatives of LinkedIn management, including Mr. Weiner, spoke with representatives of Party B management regarding a potential transaction.

On May 4, 2016, Party B informed LinkedIn that it was no longer interested in pursuing an acquisition of LinkedIn, but remained interested in partnering with LinkedIn.

Also on May 4, 2016, Microsoft submitted a non-binding indication of interest to acquire LinkedIn at a price of $160 in cash per share of LinkedIn common stock. Microsoft also stated that it was willing to consider including Microsoft common stock as part of such consideration. Microsoft’s indication of interest also requested that LinkedIn enter into an exclusivity agreement.

On May 6, 2016, the LinkedIn Board met, with representatives of LinkedIn management, Qatalyst Partners, Allen and Wilson Sonsini, respectively, in attendance. LinkedIn management informed the LinkedIn Board that Party B, Party C and Party D were not interested in pursuing a transaction, but that Party B remained interested in pursuing a commercial partnership. The members of the LinkedIn Board then discussed the terms of the proposals that had been submitted by Microsoft and Party A. The representatives of Qatalyst Partners reviewed with the members of the LinkedIn Board a financial presentation, which (1) addressed various perspectives on LinkedIn’s valuation on a standalone basis; and (2) analyzed a potential acquisition of LinkedIn. The representatives of Wilson Sonsini discussed the fiduciary duties of the LinkedIn Board. The members of the LinkedIn Board then authorized the Transactions Committee to continue to oversee the process of analyzing possible strategic alternative transactions, including the proposals submitted by Microsoft and Party A.

Immediately following the meeting of the LinkedIn Board on May 6, 2016, the Transactions Committee met, with Mr. Hoffman and representatives of LinkedIn management, Qatalyst Partners, Allen and Wilson Sonsini, respectively, in attendance. Following further discussion of the proposals that had been submitted by Microsoft and Party A, the Transactions Committee instructed the representatives of Qatalyst Partners to communicate to each of Microsoft and Party A that LinkedIn was prepared to enter exclusive negotiations at a price of $200 per share of LinkedIn common stock. Later that day, the representatives of Qatalyst Partners communicated this position to each of Microsoft and Party A. Neither Microsoft nor Party A chose to pursue exclusivity at that price.

On May 9, 2016, Mr. Hoffman and Bill Gates, the co-founder of Microsoft and member of its board of directors, held a meeting, which had been scheduled before a potential transaction between the parties had begun to be discussed. At their meeting, they discussed their perspectives regarding industry trends and the strategy of LinkedIn. The parties also discussed the business rationale and potential benefits to Microsoft of potentially acquiring LinkedIn. Mr. Gates and Mr. Hoffman briefly discussed Mr. Hoffman’s potential involvement with the business following a transaction, including, among other things, his possibly serving on Microsoft’s board of directors, but the parties did not pursue that conversation, instead focusing on their respective visions for a combined company.

Later on May 9, 2016, Mr. Hoffman then met with Mr. Nadella, and they as well discussed the business rationale and potential benefits to Microsoft of potentially acquiring LinkedIn. They also briefly discussed Mr. Hoffman’s potential involvement with the business following a transaction but chiefly focused on their shared vision for the combination of the two companies.

Also on May 9, 2016, Party A submitted a revised proposal to LinkedIn providing for an acquisition of LinkedIn for $171 per share of LinkedIn common stock, with half of the consideration in cash and half in Party A common stock.

On May 10, 2016, representatives of Qatalyst Partners spoke with representatives of Party A regarding the proposal received on May 9, 2016.

On May 11, 2016, Microsoft submitted a revised proposal to acquire LinkedIn, which provided for an acquisition of LinkedIn for $172 in cash per share of LinkedIn common stock. Microsoft noted that it remained flexible with respect to the possibility of including Microsoft common stock in the consideration, if requested by LinkedIn. The proposal again requested that LinkedIn enter into an exclusivity agreement.

Later on May 11, 2016, the Transactions Committee met, with representatives of LinkedIn management, Qatalyst Partners, Allen and Wilson Sonsini, respectively, in attendance. The Transactions Committee discussed with the representatives of Qatalyst Partners, Allen and Wilson Sonsini the revised proposals that had been submitted by Microsoft and Party A and the next steps with regard to further discussions with each. The Transactions Committee and representatives of Qatalyst Partners and Allen also noted that, based on prior conversations with Mr. Hoffman, Mr. Hoffman’s preference would likely be for consideration that consisted of a mix of cash and stock in a transaction intended to qualify as a tax-free reorganization, in light of the value of the deferral of taxes on the stock portion of the consideration. The Transactions Committee authorized representatives of Qatalyst Partners to respond to Party A and Microsoft with requests for increased offers.

The representatives of Qatalyst Partners contacted each of Party A and Microsoft, consistent with the Transactions Committee’s instructions.

On May 12, 2016, the Transactions Committee met, with Mr. Hoffman and representatives of LinkedIn management, Qatalyst Partners, Allen and Wilson Sonsini, respectively, in attendance. The Transactions Committee discussed with the representatives of Qatalyst Partners and Allen the process to date with respect to discussions with Microsoft and Party A. The representatives of Qatalyst Partners noted that Party A had indicated that although Party A preferred a negotiation to an auction, if there were to be an auction, Party A expected that all parties’ bids would be considered at once. With respect to Microsoft, the representatives of Qatalyst Partners indicated that Microsoft expressed a similar concern relating to continued incremental bidding and was seeking guidance with respect to an acceptable price. The members of the Transactions Committee then discussed with the representatives of Qatalyst Partners and instructed the representatives of Qatalyst Partners to request best and final bids from each of Party A and Microsoft, and indicate to each of the bidders that following receipt and consideration of the bids, in the event LinkedIn chose to move forward, LinkedIn intended to choose only one party with whom to pursue exclusive negotiations. The Transactions Committee concluded that this would alleviate concerns regarding the potential for a bid to be shopped and make a more aggressive offer more likely. The Transactions Committee also considered the length of the process to date and the depth of interactions with each of the parties as well as the fact that prolonged continuation of the process would likely be an increasing distraction for management of the Company and have potential for leaks in the media that could be damaging to the Company’s business. In light of these considerations, the Transactions Committee instructed the representatives of Qatalyst Partners to inform both Microsoft and Party A that they were to submit best and final offers to acquire LinkedIn prior to the LinkedIn Board meeting scheduled for the afternoon of May 13, 2016. Mr. Hoffman informed the Transactions Committee that he wished to call Mr. Nadella and indicate that he would personally support a transaction with Microsoft at $185 per share or greater if the LinkedIn Board chose Microsoft as the winning bidder after the receipt of best and final offers.

Later on May 12, 2016, and on May 13, 2016, Mr. Hoffman conveyed to Mr. Nadella the message he discussed with the Transactions Committee. Also on May 12, 2016, representatives of Qatalyst Partners spoke with (1) representatives of Party A and their financial advisor and (2) representatives of Microsoft and Morgan Stanley and conveyed to the respective parties the messages instructed by the Transactions Committee.

On May 13, 2016, Microsoft submitted a revised proposal in response to the request for best and final offers for an acquisition of LinkedIn at a price of $182 in cash per share of LinkedIn common stock, with the flexibility to include Microsoft common stock as part of the mix of consideration if requested by LinkedIn. Later that afternoon, Party A submitted a revised proposal in response to the request for best and final offers for an acquisition of LinkedIn for $182 per share of LinkedIn common stock, consisting of $85 in cash and the remainder in Party A common stock. Both proposals requested that LinkedIn negotiate on an exclusive basis.

Later on May 13, 2016, the LinkedIn Board met, with representatives of LinkedIn management, Qatalyst Partners, Allen and Wilson Sonsini, respectively, in attendance. The members of the LinkedIn Board reviewed and discussed the process to date, and the terms of the proposals submitted by Microsoft and Party A in response to the request for best and final offers. The members of the LinkedIn Board and representatives of Qatalyst Partners and Allen discussed various considerations raised by the two proposals, including, among other things, (1) the value certainty of the respective proposals; (2) the historical volatility of the stock price of each of Microsoft and Party A; (3) the execution risks of the respective proposals; (4) certainty of closing, including the need for the approval of Party A’s stockholders; and (5) the relative financing needs of each of Microsoft and Party A. The LinkedIn Board considered, in light of LinkedIn’s request for best and final offers and messaging regarding the process previously delivered to each bidder, the potential effects of calling one or both parties to seek an increased proposal and the risk to the process of potentially alienating one or both parties by doing so. The representatives of Wilson Sonsini then reviewed with the members of the LinkedIn Board their fiduciary obligations. The representatives of Wilson Sonsini discussed with the LinkedIn Board that a definitive agreement for a transaction would be expected to permit LinkedIn to respond to unsolicited acquisition proposals and accept a superior proposal, subject to payment of a termination fee. The LinkedIn Board discussed the two proposals and unanimously concluded to proceed with exclusivity with Microsoft. The LinkedIn Board discussed negotiating with Microsoft to explore structuring the transaction to include Microsoft stock, and have the stock component of the merger consideration be tax-deferred to stockholders, something for which Mr. Hoffman expressed his preference. In this regard, the LinkedIn Board also discussed proposing a mechanism whereby Microsoft would provide some level of “price certainty” for shares issued in the transaction. The LinkedIn Board authorized LinkedIn to enter into an exclusivity agreement with Microsoft.

Immediately following the meeting of the LinkedIn Board on May 13, 2016, the Transactions Committee met, with Mr. Hoffman and representatives of LinkedIn management, Qatalyst Partners, Allen and Wilson Sonsini, respectively, in attendance. The members of the Transactions Committee discussed the communication of the LinkedIn Board’s decision to each of Microsoft and Party A.

Later, on May 13, 2016, representatives of Qatalyst Partners, on behalf of LinkedIn, informed Party A that LinkedIn was proceeding to enter into an exclusivity agreement with another party.

On May 14, 2016, LinkedIn signed an exclusivity agreement with Microsoft that expired on June 12, 2016. The exclusivity agreement, among other things, prohibited LinkedIn from soliciting alternative acquisition proposals or engaging in negotiations with other parties regarding an alternative acquisition.

Beginning May 14, 2016, and continuing until the signing of the merger agreement, Microsoft continued its due diligence review of LinkedIn through in person meetings, telephone calls and access to an electronic data room made available by LinkedIn. Beginning at the same time and ending June 6, 2016, the parties engaged in discussions regarding the terms of a collar in order to introduce a degree of price certainty for the stock component of the consideration being discussed.

On May 16, 2016, Wilson Sonsini, on behalf of LinkedIn, provided Simpson Thacher with a draft of the merger agreement, which, among other things, (1) provided LinkedIn with the right to terminate the merger agreement to accept a superior proposal; and (2) proposed consideration that consisted of a mix of cash and stock in a transaction intended to qualify as a tax-free reorganization.

On May 20, 2016, Simpson Thacher, on behalf of Microsoft, provided Wilson Sonsini with a revised draft of the merger agreement. Among other things, the revised draft of the merger agreement: (1) provided for a support agreement to be entered into by Mr. Hoffman, a draft of which was also provided by Simpson Thacher; (2) reserved for future comments on the form of merger consideration and antitrust matters; (3) indicated that LinkedIn’s proposal that it have the right to terminate the merger agreement to accept a superior proposal was subject to additional discussions between the parties; and (4) included revisions to the circumstances in which a termination fee would be payable by LinkedIn.

Later on May 20, 2016, LinkedIn received a revised proposal from Party A for an acquisition of LinkedIn for $85 in cash and a fixed number of shares of Party A common stock which, based on the closing price of Party A’s common stock on May 19, 2016, represented a proposal with a notional value at that time of approximately $188 per share of LinkedIn common stock.

On May 21, 2016, the Transactions Committee met, with Mr. Hoffman and representatives of LinkedIn management, Qatalyst Partners, Allen and Wilson Sonsini, respectively, in attendance. The members of the Transactions Committee discussed with representatives of Qatalyst Partners, Allen and Wilson Sonsini, respectively, next steps with respect to the receipt of the revised proposal from Party A in light of the terms of the exclusivity agreement with Microsoft and the confidentiality agreement with Party A. The Transactions Committee noted that the revised proposal was in fact quite similar economically to the implied value of the proposal sent by Party A on May 13, 2016, at the time it was sent, insofar as the implied floating stock exchange ratio of the May 13, 2016 proposal, using Party A’s trading price on May 13, 2016, was the same as the fixed stock exchange ratio in the revised proposal of May 20, 2016; the increase in the notional value of Party A’s proposal was attributable to the increase in Party A’s trading price between May 13, 2016, and May 20, 2016. The Transactions Committee also discussed factors that could be affecting Party A’s trading price. The Transactions Committee then discussed the appropriate manner in which to address the revised Party A proposal in light of the LinkedIn Board’s fiduciary and contractual obligations. The Transactions Committee concluded it could not respond to Party A in light of LinkedIn’s exclusivity agreement with Microsoft. The Transactions Committee further concluded that LinkedIn would continue negotiations with Microsoft and evaluate the situation further closer to the expiration of the exclusivity period with Microsoft, and after Microsoft’s due diligence was substantially completed. In this regard, those present discussed the need to preserve flexibility in the negotiations with Microsoft in the event that Party A remained interested in acquiring LinkedIn closer to the expiration of the exclusivity period.

On May 25, 2016, the chief executive officer of Party A emailed Messrs. Hoffman and Weiner to indicate that Party A’s stock performance since Party A’s revised proposal was sent on May 20, 2016, had increased the notional value of its revised proposal.

Later on May 25, 2016, Wilson Sonsini, on behalf of LinkedIn, provided Simpson Thacher with a revised draft of the merger agreement. Among other things, the revised draft of the merger agreement: (1) noted that the support agreement proposed to be entered into by Mr. Hoffman was under review by Mr. Hoffman; (2) indicated that the form of merger consideration and antitrust matters remained under review by the parties; (3) provided for LinkedIn’s right to terminate the agreement in the event of a superior proposal; and (4) indicated that the amount of a termination fee that would be payable by LinkedIn remained under review by the parties.

On May 26, 2016, the LinkedIn Board met, with representatives of LinkedIn management and Wilson Sonsini in attendance. The LinkedIn Board discussed the current state of due diligence and negotiations with Microsoft and again reviewed the LinkedIn long-term management plan.

On June 1, 2016, Simpson Thacher, on behalf of Microsoft, provided Wilson Sonsini with a revised draft of the merger agreement. The revised draft of the merger agreement provided, among other things, (1) for limitations with respect to Microsoft’s obligations in connection with antitrust matters; and (2) a termination fee of 3.85% of the fully diluted equity value of LinkedIn, which would represent approximately $1 billion, that would be payable in certain circumstances by LinkedIn.

Later on June 1, 2016, Mr. Hoffman informed the Company that he would not be prepared to enter into the support agreement with Microsoft in light of the potential risk that doing so could, under LinkedIn’s certificate of incorporation, potentially result in the automatic conversion of his Class B common stock to Class A common stock.

On June 3, 2016, representatives of Wilson Sonsini, Weil Gotshal & Manges, counsel to Mr. Hoffman, Simpson Thacher and Richards, Layton & Finger, Delaware counsel to Microsoft, held a conference call to discuss the support agreement and issues relating to the automatic conversion feature in LinkedIn’s certificate of incorporation. Following this call, representatives of Simpson Thacher indicated to Wilson Sonsini that if Microsoft would not receive a support agreement from Mr. Hoffman, it would seek additional provisions in the merger agreement to address the additional conditionality that it would introduce to the deal.

On June 4, 2016, Wilson Sonsini, on behalf of LinkedIn, provided Simpson Thacher with a revised draft of the merger agreement and a draft of the disclosure letter to the merger agreement. Among other things, the revised draft of the merger agreement:(1) provided that Mr. Hoffman would not enter into a support agreement; (2) included additional covenants with respect to Microsoft’s obligations in connection with antitrust matters; and (3) provided for a termination fee of 1.75% of the fully diluted equity value of LinkedIn, which would represent approximately $450 million, that would be payable in certain circumstances by LinkedIn.

On June 5, 2016, LinkedIn received a further revised proposal from Party A for an acquisition of LinkedIn at a price per share of LinkedIn common stock of $85 in cash and a fixed number of shares of Party A common stock, which fixed number of Party A shares was increased from Party A’s May 20, 2016 proposal. Based on the closing price of Party A’s common stock on June 3, 2016, the last trading day prior to receipt of the proposal, this proposal represented a notional value of approximately $200 per share of LinkedIn common stock at that time.

Also on June 5, 2016, Mr. Nadella and Mr. Weiner spoke and discussed operating principles and a governance framework for the LinkedIn business following the acquisition.

On June 6, 2016, the Transactions Committee met, with Mr. Hoffman and representatives of LinkedIn management, Qatalyst Partners, Allen and Wilson Sonsini, respectively, in attendance. The respective representatives of Qatalyst Partners, Allen and Wilson Sonsini discussed with the members of the Transactions Committee the process with respect to the receipt of the revised proposal from Party A in light of the terms of the exclusivity agreement with Microsoft and the confidentiality agreement with Party A. The Transactions Committee noted that the material difference in the revised proposal relative to the revised proposal from Party A of May 20, 2016, was that the fixed stock exchange ratio had been increased. The Transactions Committee then discussed the appropriate manner in which to address the further revised proposal in light of the LinkedIn Board’s fiduciary and contractual obligations. The Transactions Committee determined, in light of the prohibition in LinkedIn’s exclusivity agreement with Microsoft on discussions with other parties, not to respond to Party A and to continue negotiations with Microsoft and to indicate to Microsoft that Microsoft’s current proposal of $182 in cash per share of LinkedIn common stock was no longer supportable and encourage Microsoft to offer $200 per share. Mr. Weiner informed the members of the Transactions Committee that he had spoken to Mr. Hoffman and Mr. Hoffman was now also supportive of the consideration in an acquisition of LinkedIn being entirely in the form of cash, in addition to remaining comfortable with a cash and stock transaction. Representatives of Qatalyst Partners discussed with the Transactions Committee that an acquisition entirely for cash would be more attractive to Microsoft.

Also on June 6, 2016, representatives of Qatalyst Partners spoke to representatives of Morgan Stanley and, in the context of the expected timing of entry into a merger agreement prior to the expiration of exclusivity, conveyed that Microsoft’s proposal of $182 in cash per share of LinkedIn common stock was no longer supportable, Microsoft should consider an offer of $200 per share and Mr. Hoffman was now supportive of the consideration being entirely in the form of cash as part of an increase to Microsoft’s offer.

On June 7, 2016, and June 8, 2016, during conversations concerning the status of the transaction, Messrs. Hoffman and Weiner separately communicated to Mr. Nadella that a transaction at $182 per share of LinkedIn common stock was no longer supportable and encouraged Mr. Nadella to offer $200 per share. In the course of these conversations, Mr. Hoffman indicated that he was willing to consider an all-cash transaction with Microsoft as part of an increase in Microsoft’s offer. Mr. Nadella also indicated to Mr. Weiner that a discussion of cost synergies in the transaction would be necessary in connection with any potential price increase from Microsoft. Also on June 8, 2016, Brad Smith, Microsoft’s president and chief legal officer, separately spoke with Mr. Battle and met with Mr. Callahan and conveyed to each that any potential increase in Microsoft’s offer would necessitate a discussion of cost synergies.

On June 9, 2016, the Transactions Committee met, with representatives of LinkedIn management, Qatalyst Partners, Allen and Wilson Sonsini, respectively, in attendance. Representatives of LinkedIn management, Qatalyst Partners and Allen discussed with the members of the Transactions Committee the strategy for obtaining a higher offer from Microsoft in light of the two revised proposals from Party A. Mr. Weiner noted that Mr. Nadella had informed him that Microsoft would need to identify cost synergies in connection with any increase in its offer. The representatives of Qatalyst Partners reviewed with the members of the Transactions Committee the key differences between the latest revised proposal from Party A and the current proposal from Microsoft. The representatives of Wilson Sonsini discussed with the members of the Transactions Committee their fiduciary duties in light of the Microsoft proposal and the receipt of the revised proposal from Party A.

Also on June 9, 2016, Simpson Thacher, on behalf of Microsoft, provided Wilson Sonsini with a revised draft of the disclosure letter to the merger agreement.

Later on June 9, 2016, Mr. Nadella met with Mr. Weiner to discuss integration planning and potential cost synergies arising from the combination and the status of the transaction generally. At that meeting, Mr. Weiner reiterated that $182 was no longer supportable.

On June 10, 2016, Mr. Sordello sent Amy Hood, Microsoft’s chief financial officer, an analysis of potential cost synergies arising from the combination. Later that day, Mr. Sordello and Ms. Hood discussed various potential cost synergies arising from the combination. Later that day, Microsoft delivered a revised proposal to LinkedIn that provided for an acquisition of LinkedIn for $190 in cash per share of LinkedIn common stock. Messrs. Nadella and Smith also called Messrs. Weiner and Callahan, respectively, to convey the proposal verbally.

Also on June 10, 2016, Simpson Thacher, on behalf of Microsoft, provided Wilson Sonsini, on behalf of LinkedIn, with a revised draft of the merger agreement. Among other things, the revised draft of the merger agreement: (1) provided for Messrs. Hoffman and Weiner to each enter into a support agreement whereby each would, among other things, agree not to enter into any voting agreement with a third party; (2) indicated that the form of merger consideration would be all cash; (3) included changes to covenants with respect to Microsoft’s obligations in connection with antitrust matters; and (4) provided for a termination fee of 3.75% of the fully diluted equity value of LinkedIn, which would represent approximately $1 billion, that would be payable in certain circumstances by LinkedIn.

Later on June 10, 2016, representatives of Wilson Sonsini, on behalf of LinkedIn, negotiated the merger agreement with representatives of Simpson Thacher, on behalf of Microsoft. As a part of this conversation, it was conveyed that Messrs. Hoffman and Weiner would not enter into any type of support agreement with Microsoft. In addition, there remained open issues regarding antitrust matters, the amount of the termination fee and the circumstances under which it would be payable.

Later on June 10, 2016, the Transactions Committee met, with representatives of LinkedIn management, Qatalyst Partners, Allen and Wilson Sonsini, respectively, in attendance. Mr. Weiner updated the members of the Transactions Committee on his conversation the prior evening with Mr. Nadella. The members of the Transactions Committee discussed the revised offer for $190 in cash per share of LinkedIn common stock that had been delivered earlier that day. The representatives of Wilson Sonsini provided an update on the status of the negotiation of the merger agreement, noting that, in addition to price, the antitrust provisions, the amount of the termination fee payable and the circumstances under which it would be payable were the other remaining material points to negotiate. The Transactions Committee then authorized Mr. Weiner to continue discussions with Mr. Nadella for the purpose of (1) emphasizing that Microsoft needed to offer the highest price possible; (2) emphasizing the risks inherent to Microsoft in allowing the exclusivity period to lapse without entering into a merger agreement; and (3) conveying that there was some support for a transaction with Microsoft at $196 per share in cash (but that any transaction would require full board approval).

Later on June 10, 2016, Mr. Weiner spoke with Mr. Nadella and relayed the discussion items authorized by the Transactions Committee.

Early in the morning of June 11, 2016, Wilson Sonsini, on behalf of LinkedIn, provided Simpson Thacher, on behalf of Microsoft, with a revised draft of the merger agreement and a revised draft of the disclosure letter to the merger agreement. The revised draft of the merger agreement provided, among other things, (1) there would not be any support agreement; (2) additional covenants with respect to Microsoft’s obligations in connection with antitrust matters; and (3) a termination fee of $700 million, that would be payable in certain circumstances by LinkedIn, with a reduced termination fee payable in the event of a termination of the merger agreement due to a failure to obtain LinkedIn stockholder approval.

Also in the morning of June 11, 2016, Mr. Nadella informed Mr. Weiner that Microsoft’s board of directors had approved a revised proposal for an acquisition of LinkedIn at a price of $196 in cash per share of LinkedIn common stock and that Microsoft wanted to finalize and execute the merger agreement later that day. Shortly thereafter, Microsoft sent Mr. Weiner a revised proposal for an acquisition of LinkedIn for $196 in cash per share of LinkedIn common stock.

Later in the morning of June 11, 2016, Wilson Sonsini, on behalf of LinkedIn, and Simpson Thacher, on behalf of Microsoft, negotiated the final versions of the merger agreement and the disclosure letter to the merger agreement. As part of these negotiations, the parties agreed on the scope of antitrust provisions and agreed on a termination fee of $725 million. Simpson Thacher stated that Microsoft required as a condition to proceeding with a transaction that the full termination fee be payable in the event of a termination of the merger agreement due to a failure to obtain LinkedIn stockholder approval.

In the afternoon of June 11, 2016, the LinkedIn Board met, with the respective representatives of LinkedIn management, Qatalyst Partners, Allen, Wilson Sonsini and Gibson Dunn & Crutcher, outside antitrust counsel to LinkedIn, which we refer to as “Gibson Dunn,” in attendance. During the meeting, representatives of Qatalyst Partners, Allen and Wilson Sonsini reviewed the terms of the merger agreement and Microsoft’s proposal for an acquisition of LinkedIn at $196 per share in cash as well as the terms of the most recent proposal from Party A. The representatives of Wilson Sonsini reviewed with the members of the LinkedIn Board their fiduciary duties, including the relevant judicial standards of review and the process associated with a decision by the LinkedIn Board to engage in the proposed transaction. The representatives of Wilson Sonsini discussed the process to date, including the proposals that had been made by Microsoft and Party A both prior to entering into exclusivity with Microsoft, and thereafter. The representatives of Wilson Sonsini also reported on negotiations with Microsoft with respect to the terms of the merger agreement. A representative of Gibson Dunn reviewed with the members of the LinkedIn Board antitrust matters applicable to the merger agreement. The representatives of Qatalyst Partners reviewed with the members of the LinkedIn Board Qatalyst Partners’ financial analysis of the $196 per share cash consideration to be offered to LinkedIn stockholders in the proposed merger. The representatives of Wilson Sonsini described the principal terms of the proposed merger agreement between LinkedIn and Microsoft. The LinkedIn Board then discussed potential reasons for, and risks inherent in, entering into an agreement for an acquisition with Microsoft, including, among other things, (1) the fact that the merger agreement permits the LinkedIn Board to consider, negotiate and accept an unsolicited superior proposal from Party A or other potential third parties and terminate the Company’s agreement with Microsoft, subject to payment of the termination fee; (2) the potential of Party A’s willingness to continue to make acquisition proposals; (3) the need for Party A to obtain approval from its stockholders to consummate a transaction; (4) the value of and the certainty of value in the cash consideration offered by Microsoft and the cash and stock consideration proposed by Party A; (5) the current and prospective future state of credit markets; (6) the execution risks involved in negotiating and finalizing a merger agreement with Party A (versus the already negotiated merger agreement with Microsoft); and (7) the risks that Microsoft might not continue to pursue an acquisition of the Company after the expiration of the exclusivity period if a merger agreement were not executed by that time. Each of the members of the Transactions Committee discussed with the other members of the LinkedIn Board his views regarding the proposals and the process to date. Each of the members of the Transactions Committee noted that he was in favor of proceeding with Microsoft’s proposal before the lapse of exclusivity, particularly in light of (1) the value of Microsoft’s all-cash proposal; and (2) the execution risks and value of Party A’s proposal. Mr. Hoffman then stated that he believed that the proposed transaction with Microsoft would be in the best interests of LinkedIn’s stockholders and that, as a stockholder, he would vote in favor of the transaction with Microsoft, subject to the LinkedIn Board’s continued recommendation in favor of the transaction pursuant to the terms of the merger agreement. The representatives of Qatalyst Partners then rendered Qatalyst Partners’ oral opinion to the LinkedIn Board, subsequently confirmed by delivery of a written opinion dated June 11, 2016, that, as of June 11, 2016, and based upon and subject to the various assumptions, considerations, limitations and other matters set forth therein, the per share merger consideration to be received by the holders of shares of LinkedIn Class A common stock pursuant to the merger agreement (other than Microsoft or any affiliate of Microsoft), in their capacity as holders of LinkedIn Class A common stock, was fair from a financial point of view to such holders. For more information about Qatalyst Partners’ opinion, see the section of this proxy statement captioned “The Merger — Fairness Opinion of Qatalyst Partners.” After further discussion, the LinkedIn Board unanimously (1) determined that it was in the best interests of LinkedIn and its stockholders, and declared it advisable, to enter into the merger agreement and consummate the merger upon the terms and subject to the conditions set forth therein; (2) approved the execution and delivery of the merger agreement by LinkedIn, the performance by LinkedIn of its covenants and other obligations thereunder, and the consummation of the merger upon the terms and conditions set forth therein; (3) directed that the adoption of the merger agreement be submitted to a vote at a meeting of the stockholders of LinkedIn; and (4) resolved to recommend that LinkedIn stockholders vote in favor of adoption of the merger agreement. Mr. Weiner then informed the members of the LinkedIn Board that Microsoft had indicated a desire to begin discussion and negotiation of an employment arrangement with him prior to announcement of a transaction and the LinkedIn Board acquiesced to such discussions taking place.

Later on June 11, 2016, LinkedIn informed Microsoft that the LinkedIn Board had approved the acquisition, and the merger agreement was signed.

On June 13, 2016, prior to the opening of trading of the Class A common stock on the NYSE, LinkedIn and Microsoft issued a joint press release announcing the entry into the merger agreement.

On July 7, 2016, the Transactions Committee met, with representatives of LinkedIn management, Qatalyst Partners, Allen and Wilson Sonsini, respectively, in attendance. During the course of the meeting, the Transactions Committee reviewed and discussed with representatives of Qatalyst Partners, Allen and Wilson Sonsini an email to Messrs. Hoffman and Weiner that Party A’s chief executive officer sent upon reading in LinkedIn’s preliminary proxy a description of the events leading up to and following LinkedIn’s call for best and final offers from Party A and Microsoft on May 13, 2016, and subsequent agreement with Microsoft to negotiate exclusively. Reflecting on the additional proposals it made after LinkedIn and Microsoft agreed to exclusivity, the email indicated that Party A would have bid much higher and made changes to the stock/cash components of its offers, but it was acting without communications from LinkedIn. The Transactions Committee reviewed the sale process to that date, including (1) conversations with Party A prior to entering into the exclusivity agreement with Microsoft regarding, among other things, price and the limits on the amount of cash that Party A would likely be willing to offer; (2) the call for best and final offers to be submitted on May 13, 2016, as a precursor to entry into exclusivity; and (3) the last proposal received from Party A on June 5, 2016, during the exclusivity period with Microsoft (which proposal did not indicate that Party A could offer either (a) a price higher than that stated or (b) a change in the stock/cash components). The Transactions Committee also considered the contractual provisions contained in the definitive merger agreement with Microsoft, including those relating to discussions with third parties, and determined not to respond.