Form PREM14A CHANNELADVISOR CORP For: Sep 27

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE

SECURITIES EXCHANGE ACT OF 1934

Filed by the Registrant  ☒

Filed by a party other than the Registrant  ☐

Check the appropriate box:

ChannelAdvisor Corporation

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

PRELIMINARY PROXY STATEMENT—SUBJECT TO COMPLETION, DATED SEPTEMBER 27, 2022

ChannelAdvisor Corporation

3025 Carrington Mill Boulevard, Suite 500

Morrisville, NC 27560

Dear Stockholders of ChannelAdvisor Corporation:

You are cordially invited to attend a virtual special meeting (including any adjournments or postponements thereof, the “Special Meeting”) of stockholders of ChannelAdvisor Corporation, a Delaware corporation (“ChannelAdvisor”), to be held virtually on                    , 2022, at                     Eastern Time via live audio webcast on the Internet at www.virtualshareholdermeeting.com/ECOM2022SM.

At the Special Meeting, you will be asked to consider and vote on (i) a proposal to adopt the Agreement and Plan of Merger, dated September 4, 2022 (such agreement, as it may be amended, modified or supplemented from time to time, the “Merger Agreement”), by and among ChannelAdvisor, CommerceHub, Inc., a Delaware corporation (“CommerceHub”), and CH Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of CommerceHub (“Merger Sub”) providing for the acquisition of ChannelAdvisor by CommerceHub, (ii) a proposal to approve, on an advisory (non-binding) basis, the compensation that may be paid or become payable to ChannelAdvisor’s named executive officers that is based on or otherwise relates to the Merger Agreement and the transactions contemplated by the Merger Agreement (the “Compensation Proposal”), and (iii) a proposal to approve the adjournment of the Special Meeting to a later date or dates, if necessary or appropriate, including to solicit additional proxies to approve the proposal to adopt the Merger Agreement if there are insufficient votes to adopt the Merger Agreement at the time of the Special Meeting (the “Adjournment Proposal”). Upon the terms and subject to the conditions of the Merger Agreement, CommerceHub will acquire ChannelAdvisor via the merger of Merger Sub with and into ChannelAdvisor, with ChannelAdvisor continuing as the surviving corporation and a wholly owned subsidiary of CommerceHub (the “Merger”).

If the Merger is completed, you will be entitled to receive $23.10 in cash, without interest thereon and subject to any applicable withholding taxes required by applicable legal requirements, for each share of ChannelAdvisor common stock (“common stock”) that you own immediately prior to the time at which the Merger will become effective (unless you are entitled to and have properly exercised and not waived, withdrawn, failed to perfect or otherwise lost your appraisal rights), which represents a premium of approximately 57.1% to the closing price of ChannelAdvisor’s common stock on September 2, 2022, the last full trading day prior to the entry into the Merger Agreement.

ChannelAdvisor’s Board of Directors (the “Board of Directors”), after considering the factors more fully described in the enclosed proxy statement, has unanimously: (i) determined that ChannelAdvisor’s entry into the Merger Agreement and the consummation of the transactions contemplated by the Merger Agreement, including the Merger (“the “Transactions”) are advisable and fair to, and in the best interests of, ChannelAdvisor and its stockholders, (ii) authorized and approved the execution, delivery and performance by ChannelAdvisor of the Merger Agreement and the consummation of the Transactions, including the Merger and (iii) subject to the terms and conditions of the Merger Agreement, resolved to recommend that the stockholders of ChannelAdvisor adopt the Merger Agreement and approve the Merger and the Transactions.

The Board of Directors unanimously recommends, on behalf of ChannelAdvisor, that you vote: (1) “FOR” the adoption of the Merger Agreement; (2) “FOR” the approval, on an advisory (non-binding) basis, of the Compensation Proposal; and (3) “FOR” the Adjournment Proposal.

The enclosed proxy statement provides detailed information about the Special Meeting, the Merger Agreement and the Merger. A copy of the Merger Agreement is attached as Annex A to the proxy statement. We urge you to read both the proxy statement and Merger Agreement carefully in their entirety.

The proxy statement also describes the actions and determinations of the Board of Directors in connection with its evaluation of the Merger Agreement and the Merger. You should carefully read and consider the entire enclosed proxy statement and its annexes, including, but not limited to, the Merger Agreement, as they contain important information about, among other things, the Merger and how it affects you.

Whether or not you plan to attend the Special Meeting virtually, please sign, date and return, as promptly as possible, the enclosed proxy card in the accompanying prepaid reply envelope or grant your proxy electronically over the Internet or by telephone (using the instructions provided in the enclosed proxy card). If you attend the Special Meeting and vote at the meeting your vote will revoke any proxy that you have previously submitted.

If you hold your shares in “street name,” you should instruct your bank, broker or other nominee how to vote your shares in accordance with the voting instruction form that you will receive from your bank, broker or other nominee. Your bank, broker or other nominee cannot vote on any of the proposals, including the proposal to adopt the Merger Agreement, without your instructions.

Your vote is very important, regardless of the number of shares that you own. We cannot complete the Merger unless the proposal to adopt the Merger Agreement is approved by the affirmative vote of the holders of a majority of all outstanding shares of ChannelAdvisor’s common stock as of the close of business on                     , 2022 which is the record date for the Special Meeting.

Stockholders who do not vote in favor of the proposal to adopt the Merger Agreement, and who object in writing to the Merger prior to the vote on the proposal to adopt the Merger Agreement at the Special Meeting and comply with all of the applicable requirements of Delaware law, which are summarized in the section captioned “The Merger—Appraisal Rights” in the accompanying proxy statement and reproduced in their entirety in Annex C to the accompanying proxy statement, will be entitled to appraisal rights to obtain the fair value of their shares of ChannelAdvisor’s common stock.

If you have any questions concerning the Merger Agreement, the Merger, the Special Meeting or the accompanying proxy statement, would like additional copies of the accompanying proxy statement or need help voting your shares of common stock, please contact our proxy solicitor:

MacKenzie Partners, Inc.

1407 Broadway, 27^th Floor

New York, NY 10018

Toll-free: 1-800-322-2885

Email: [email protected]

On behalf of the Board of Directors, I thank you for your support and appreciate your consideration of this matter.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the Merger, passed upon the merits or fairness of the Merger Agreement or the Transactions, including the proposed Merger, or passed upon the adequacy or accuracy of the information contained in the accompanying proxy statement. Any representation to the contrary is a criminal offense.

This proxy statement is dated                     , 2022, and is first being mailed to our stockholders on or about                     , 2022.

ChannelAdvisor Corporation

3025 Carrington Mill Boulevard, Suite 500

Morrisville, NC 27560

(919) 228-4700

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS TO BE HELD ON                    , 2022

Notice is hereby given that a virtual special meeting of stockholders (including any adjournments or postponements thereof, the “Special Meeting”) of ChannelAdvisor Corporation, a Delaware corporation (“ChannelAdvisor”), to be held virtually on                 , 2022, at                  Eastern Time via live audio webcast on the Internet at www.virtualshareholdermeeting.com/ECOM2022SM, for the following purposes:

Only stockholders of record as of the close of business on             , 2022, are entitled to notice of the Special Meeting and to vote at the Special Meeting or any adjournment, postponement or other delay thereof.

ChannelAdvisor’s Board of Directors (the “Board of Directors”) unanimously recommends, on behalf of ChannelAdvisor, that you vote: (1) “FOR” the adoption of the Merger Agreement; (2) “FOR” the approval, on an advisory (non-binding) basis, of the Compensation Proposal; and (3) “FOR” the Adjournment Proposal.

All stockholders are invited to attend the Special Meeting virtually. Whether or not you plan to attend the Special Meeting virtually, please sign, date and return, as promptly as possible, the enclosed proxy card in the accompanying prepaid reply envelope or grant your proxy electronically over the Internet or by telephone (using the instructions provided in the enclosed proxy card). If you attend the Special Meeting and vote virtually, your vote will revoke any proxy that you have previously submitted. If you hold your shares in “street name,” you should instruct your bank, broker or other nominee how to vote your shares in accordance with the voting instruction form that you will receive from your bank, broker or other nominee. Your bank, broker or other nominee cannot vote on any of the proposals, including the proposal to adopt the Merger Agreement, without your instructions.

ChannelAdvisor Corporation

3025 Carrington Mill Boulevard, Suite 500

Morrisville, NC 27560

(919) 228-4700

PROXY STATEMENT

FOR THE SPECIAL MEETING OF

STOCKHOLDERS TO BE HELD ON                     , 2022

IMPORTANT NOTICE REGARDING THE PROXY MATERIALS

FOR THE SPECIAL MEETING OF STOCKHOLDERS TO BE HELD ON                     , 2022

This proxy statement is available on the investor relations page of our website at http://ir.channeladvisor.com/. The information provided on, or accessible through, our website is not part of this proxy statement, and therefore is not incorporated herein by reference. We intend to mail these proxy materials on or about     , 2022 to all stockholders of record entitled to vote at the Special Meeting.

A complete list of registered stockholders entitled to vote at the Special Meeting will be available for inspection for the 10 calendar days prior to and during the Special Meeting upon request by contacting [email protected], and online during the Special Meeting. Stockholders may examine the list for any legally valid purpose related to the Special Meeting.

YOUR VOTE IS IMPORTANT

WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING VIRTUALLY, WE ENCOURAGE YOU TO SUBMIT YOUR PROXY AS PROMPTLY AS POSSIBLE: (1) BY TELEPHONE; (2) THROUGH THE INTERNET; OR (3) BY SIGNING AND DATING THE ENCLOSED PROXY CARD AND RETURNING IT IN THE POSTAGE-PAID ENVELOPE PROVIDED. You may revoke your proxy or change your vote at any time before it is voted at the Special Meeting.

If you hold your shares in “street name,” you should instruct your bank, broker or other nominee how to vote your shares in accordance with the voting instruction form that you will receive from your bank, broker or other nominee. Your broker or other agent cannot vote on any of the proposals, including the proposal to adopt the Merger Agreement, without your instructions.

If you are a stockholder of record, voting virtually at the Special Meeting will revoke any proxy that you previously submitted. If you hold your shares through a bank, broker or other nominee, you must obtain a “legal proxy” in order to vote virtually at the Special Meeting.

If you fail to (1) return your proxy card, (2) grant your proxy electronically over the Internet or by telephone or (3) vote virtually at the Special Meeting, your shares will not be counted for purposes of determining whether a quorum is present at the Special Meeting and, if a quorum is present, will have the same effect as a vote “AGAINST” the proposal to adopt the Merger Agreement, the Compensation Proposal and the Adjournment Proposal (as defined below).

You should carefully read and consider the entire accompanying proxy statement and its annexes, including, but not limited to, the Merger Agreement, along with all of the documents incorporated by reference into the accompanying proxy statement, as they contain important information about, among other things, the Merger and how it affects you. If you have any questions concerning the Merger Agreement, the Merger, the Special Meeting or this proxy statement, would like additional copies of this proxy statement or need help voting your shares of common stock, please contact our proxy solicitor:

MacKenzie Partners, Inc.

1407 Broadway, 27^th Floor

New York, NY 10018

Toll-free: 1-800-322-2885

Email: [email protected]

TABLE OF CONTENTS

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QUESTIONS AND ANSWERS

The following questions and answers address some commonly asked questions regarding the Merger, the Merger Agreement and the Special Meeting. These questions and answers may not address all questions that are important to you. You should carefully read and consider the more detailed information contained elsewhere in this proxy statement and the annexes to this proxy statement, including, but not limited to, the Merger Agreement, along with all of the documents we refer to in this proxy statement, as they contain important information about, among other things, the Merger and how it affects you. You may obtain the information incorporated by reference in this proxy statement without charge by following the instructions under the caption “Where You Can Find More Information.”

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Each holder of ChannelAdvisor common stock is entitled to cast one (1) vote on each matter properly brought before the Special Meeting for each such share of ChannelAdvisor common stock that such holder owned on the Record Date.

Attending the Special Meeting as a Guest. Guests may enter the Special Meeting in “listen-only” mode by entering the Special Meeting via the live audio webcast on the Internet at www.virtualshareholdermeeting.com/ECOM2022SM and entering the information requested in the “Guest Login” section. Guests will not have the ability to vote or ask questions at the Special Meeting.

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For more information, please see the section of this proxy statement captioned “Proposal 1: Adoption of the Merger Agreement—Merger Consideration—Treatment of ChannelAdvisor Options, ChannelAdvisor RSUs and ChannelAdvisor PSUs.”

If a quorum is present at the Special Meeting, the failure of any stockholder of record to: (i) submit a signed proxy card; (ii) grant a proxy over the Internet or by telephone (using the instructions provided in the enclosed proxy card); or (iii) vote virtually at the Special Meeting will have the same effect as a vote “AGAINST” the proposal to adopt the Merger Agreement. If you hold your shares in “street name” and a quorum is present at the Special Meeting, the failure to instruct your bank, broker or other nominee how to vote your shares will have the same effect as a vote “AGAINST” the proposal to adopt the Merger Agreement. If a quorum is present at the Special Meeting, abstentions will have the same effect as a vote “AGAINST” the proposal to adopt the Merger Agreement.

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As of the close of business on                , 2022, the Record Date for the Special Meeting, there were             shares of common stock outstanding.

Approval of the Adjournment Proposal requires either (i) if a quorum is present, the affirmative vote of the majority of the shares present in person, by remote communication, if applicable, or represented by proxy duly authorized at the Special Meeting and entitled to vote generally on the subject matter or (ii) if a quorum is not present, the vote of the holders of a majority of the shares represented at the Special Meeting.

For a discussion of the factors that the Board of Directors considered in determining to recommend that you vote to approve the proposal to adopt the Merger Agreement, please see the section captioned “Proposal 1: Adoption of the Merger Agreement — The Board of Directors’ Recommendation; ChannelAdvisor Adverse Change Recommendation.” In addition, when considering the recommendation of the Board of Directors, you should be aware that some of ChannelAdvisor’s directors and executive officers may have interests in the Merger that are different from, or in addition to, the interests of stockholders more generally. For a discussion of these interests, please see the section captioned “The Merger — Interests of ChannelAdvisor’s Directors and Executive Officers in the Merger.”

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Failure to vote your shares of common stock (including a failure of your broker, bank or other nominee to vote shares held on your behalf) will also count as a vote “AGAINST” the proposal to adopt the Merger Agreement. If your shares are not deemed present or represented by proxy at the Special Meeting, then a failure to vote will not have any effect on the Adjournment Proposal or the Compensation Proposal. If your shares are deemed present or represented by proxy, then a failure to vote your shares will have the same effect as a vote “AGAINST” the Adjournment Proposal only if a quorum is not present, and will have no effect on the Compensation Proposal or, if a quorum is present, on the Adjournment Proposal. Because brokers, banks and other nominees do not have discretionary voting authority with respect to the proposal to adopt the Merger Agreement, the Compensation Proposal or the Adjournment Proposal, if a beneficial owner of shares of common stock held in street name does not give voting instructions to the broker, bank or other nominee with respect to any of the proposals, then those shares will not be present or represented by proxy at the Special Meeting and will not be counted for purposes of determining whether a quorum is present at the Special Meeting. However, if a beneficial owner of shares of common stock held in street name gives voting instructions to the broker, bank or other nominee with respect to at least one of the proposals, but gives no instruction as to one or more of the other proposals, then those shares will be deemed present at the Special Meeting for purposes of establishing a quorum at the Special Meeting, will be voted as instructed with respect to any proposal as to which instructions were given, and will not be voted with respect to any other proposal. Therefore, it is important that you instruct your broker, bank or other nominee on how you wish to vote your shares.

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If your shares are held through a bank, broker or other nominee, you are considered the “beneficial owner” of shares of common stock held in “street name.” In that case, this proxy statement has been forwarded to you by your bank, broker or other nominee who is considered, with respect to those shares, to be the stockholder of record. As the beneficial owner, you have the right to direct your bank, broker or other nominee how to vote your shares by following their instructions for voting. Because of the non-routine nature of the Special Meeting Proposals, your broker, bank or other nominee is not authorized to vote your shares on any proposal without instructions from you. You are also invited to attend the Special Meeting. However, because you are not the stockholder of record, you may not vote your shares virtually at the Special Meeting unless you have obtained a legal proxy from your broker, bank or other nominee, as the stockholder of record, authorizing you to vote your shares.

A control number, located on your proxy card, is designed to verify your identity and allow you to vote your shares of common stock, and to confirm that your voting instructions have been properly recorded when voting electronically over the Internet or by telephone (using the instructions provided in the enclosed proxy card). Please be aware that, although there is no charge for voting your shares, if you vote electronically over the Internet or by telephone, you may incur costs such as Internet access and telephone charges for which you will be responsible.

Even if you plan to attend the Special Meeting virtually, you are strongly encouraged to vote your shares of common stock by proxy. If you are a record holder or if you obtain a “legal proxy” to vote shares that you beneficially own, you may still vote your shares of common stock virtually at the Special Meeting even if you have previously voted by proxy. If you are present at the Special Meeting and vote virtually, your previous vote by proxy will not be counted.

If your shares are held in “street name” through a bank, broker or other nominee, you may vote through your bank, broker or other nominee by completing and returning the voting form provided by your bank, broker or other nominee, or, if such a service is provided by your bank, broker or other nominee, electronically over the Internet or by telephone. To vote over the Internet or by telephone through your bank, broker or other nominee, you should follow the instructions on the voting form provided by your bank, broker or nominee.

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If you hold your shares of common stock in “street name,” you should contact your bank, broker or other nominee for instructions regarding how to change your vote. You may also vote virtually at the Special Meeting if you obtain a “legal proxy” from your bank, broker or other nominee.

If you properly sign your proxy card but do not mark the boxes showing how your shares should be voted on a matter, the shares represented by your properly signed proxy will be voted: (i) “FOR” the adoption of the Merger Agreement; (ii) “FOR” the Compensation Proposal; and (iii) “FOR” the Adjournment Proposal.

You may receive more than one set of voting materials, including multiple copies of this proxy statement and multiple proxy cards or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you will receive a separate voting instruction card for each brokerage account in which you hold shares. If you are a stockholder of record and your shares are registered in more than one name, you will receive more than one proxy card.

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If your shares of ChannelAdvisor’s common stock are held in “street name” by your broker, bank or other nominee, you will receive instructions from your broker, bank or other nominee as to how to effect the surrender of your “street name” shares of ChannelAdvisor’s common stock in exchange for the Merger Consideration, and you will not be mailed, and do not need to complete, a letter of transmittal.

MacKenzie Partners, Inc.

1407 Broadway, 27^th Floor

New York, NY 10018

Toll-free: 1-800-322-2885

Email: [email protected]

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FORWARD-LOOKING STATEMENTS

This proxy statement contains forward-looking statements which include, but are not limited to, all statements that do not relate solely to historical or current facts, such as statements regarding the ChannelAdvisor’s expectations, intentions or strategies regarding the future, or the completion or effects of the Merger. In some cases, these statements include words like: “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “objective,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue” and “ongoing,” or the negative of these terms, or other comparable terminology intended to identify statements about the future. These forward-looking statements are subject to the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. ChannelAdvisor’s expectations and beliefs regarding these matters may not materialize. Actual outcomes and results may differ materially from those contemplated by these forward-looking statements as a result of uncertainties, risks, and changes in circumstances, including but not limited to risks and uncertainties related to: the ability of the parties to consummate the Merger, satisfaction of closing conditions precedent to the consummation of the Merger, potential delays in consummating the Merger, the ability of ChannelAdvisor to timely and successfully achieve the anticipated benefits of the transaction and the impact of health epidemics, including the COVID-19 pandemic, on the parties’ respective businesses and the actions the parties may take in response thereto. Additional risks and uncertainties that could cause actual outcomes and results to differ materially from those contemplated by the forward-looking statements are included under the caption “Risk Factors” and elsewhere in ChannelAdvisor’s most recent filings with the SEC, including ChannelAdvisor’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2022 and any subsequent reports on Form 10-K, Form 10-Q or Form 8-K filed with the SEC from time to time and available at www.sec.gov.

The forward-looking statements included in this proxy statement are made only as of the date hereof. ChannelAdvisor assumes no obligation and does not intend to update these forward-looking statements, except as required by law.

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THE SPECIAL MEETING

The enclosed proxy is solicited on behalf of the Board of Directors for use at the Special Meeting.

Date, Time and Place

We will hold the Special Meeting virtually on     , 2022, at                     Eastern Time via the live audio webcast on the Internet at www.virtualshareholdermeeting.com/ECOM2022SM and, if applicable, at any adjournment or postponement thereof.

Purpose of the Special Meeting

At the Special Meeting, we will ask stockholders to vote on proposals to: (i) adopt the Merger Agreement; (ii) approve, on an advisory (non-binding) basis, the Compensation Proposal; and (iii) approve the Adjournment Proposal.

We do not expect that any matters other than the proposals set forth above will be brought before the Special Meeting, and only matters specified in the notice of the meeting may be acted upon at the Special Meeting.

Our stockholders must approve the proposal to adopt the Merger Agreement in order for the Merger to be consummated. If our stockholders fail to approve the proposal to adopt the Merger Agreement, the Merger will not be consummated. A copy of the Merger Agreement is attached as Annex A to this proxy statement, which we urge you to read carefully in its entirety.

Record Date; Shares Entitled to Vote; Quorum

Only stockholders of record as of the Record Date are entitled to notice of the Special Meeting and to vote at the Special Meeting. A complete list of registered stockholders entitled to vote at the Special Meeting will be available for inspection for the 10 calendar days prior to and during the Special Meeting upon request by contacting [email protected], and online during the Special Meeting. Stockholders may examine the list for any legally valid purpose related to the Special Meeting.

The presence, in person, by remote communication, if applicable, or by proxy duly authorized, of the holders of a majority of the outstanding shares of stock entitled to vote shall constitute a quorum for the transaction of business at the Special Meeting. Assuming the Special Meeting is held solely by means of remote communication, as it is currently scheduled to be, no shares will be present in person at the Special Meeting, and only shares present virtually or represented by proxy at the Special Meeting will be counted in determining whether a quorum is present. As of the Record Date, there were                shares of common stock outstanding and entitled to vote at the Special Meeting, meaning that                shares of common stock must be represented virtually or by proxy at the Special Meeting to have a quorum. In the event that a quorum is not present at the Special Meeting, it is expected that the meeting will be adjourned to solicit additional proxies to approve the proposal to adopt the Merger Agreement.

Vote Required; Abstentions and Failure to Vote

The affirmative vote of the holders of a majority of all outstanding shares of ChannelAdvisor’s common stock on the Record Date is required to adopt the Merger Agreement. As of the Record Date,                shares constitute a majority of the outstanding shares of common stock. Adoption of the Merger Agreement by stockholders is a condition to the Closing.

The affirmative vote of the majority of the shares present in person, by remote communication, if applicable, or represented by proxy duly authorized at the Special Meeting and entitled to vote generally on the subject matter is required to approve the Compensation Proposal, on an advisory (non-binding) basis, provided a quorum is present. Assuming the Special Meeting is held solely by means of remote communication, as it is currently scheduled to be, no shares will be present in person at the Special Meeting, and only shares present virtually or represented by proxy at the Special Meeting will be able to be voted.

Approval of the Adjournment Proposal requires either (i) if a quorum is present, the affirmative vote of the majority of the shares present in person, by remote communication, if applicable, or represented by proxy duly authorized at the Special Meeting and entitled to vote generally on the subject matter or (ii) if a quorum is not present, the vote of the holders of a majority of the shares represented at the Special Meeting.

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An abstention represents a stockholder’s affirmative choice to decline to vote on a proposal. If a stockholder abstains from voting, that abstention will have the same effect as if the stockholder voted “AGAINST” the proposal to adopt the Merger Agreement, the Compensation Proposal and the Adjournment Proposal. However, abstentions are counted as shares present or represented by proxy at the Special Meeting for the purposes of determining whether a quorum is present at the Special Meeting. As a result, an abstention of any of the aforementioned proposals will be counted for purposes of determining the presence or absence of a quorum, but will count as a vote “AGAINST” each of the proposal to adopt the Merger Agreement, the Compensation Proposal and the Adjournment Proposal.

Failure to vote your shares of common stock (including a failure of your broker, bank or other nominee to votes shares held on your behalf) will also count as a vote “AGAINST” the proposal to adopt the Merger Agreement. If your shares are not deemed present or represented by proxy at the Special Meeting, then a failure to vote will not have any effect on the Adjournment Proposal or the Compensation Proposal. If your shares are deemed present or represented by proxy, then a failure to vote your shares will have the same effect as a vote “AGAINST” the Adjournment Proposal only if a quorum is not present, and will have no effect on the Compensation Proposal or, if a quorum is present, on the Adjournment Proposal. Because brokers, banks and other nominees do not have discretionary voting authority with respect to the proposal to adopt the Merger Agreement, the Compensation Proposal or the Adjournment Proposal, if a beneficial owner of shares of common stock held in street name does not give voting instructions to the broker, bank or other nominee with respect to any of the proposals, then those shares will not be present or represented by proxy at the Special Meeting and will not be counted for purposes of determining whether a quorum is present at the Special Meeting. However, if a beneficial owner of shares of common stock held in street name gives voting instructions to the broker, bank or other nominee with respect to at least one of the proposals, but gives no instruction as to one or more of the other proposals, then those shares will be deemed present at the Special Meeting for purposes of establishing a quorum at the Special Meeting, will be voted as instructed with respect to any proposal as to which instructions were given, and will not be voted with respect to any other proposal.

Shares Held by ChannelAdvisor’s Directors and Executive Officers

As of the Record Date, our directors and executive officers beneficially owned and were entitled to vote, in the aggregate,                  shares of common stock, representing approximately                % of the shares of common stock outstanding on the Record Date (and approximately                % of the shares of common stock outstanding when taking into account ChannelAdvisor Options, ChannelAdvisor RSUs and ChannelAdvisor PSUs held, in the aggregate, by our directors and executive officers).

Our directors and executive officers have informed us that they currently intend to vote all of their respective shares of common stock (i) “FOR” the adoption of the Merger Agreement, (ii) “FOR” the Compensation Proposal, and (iii) “FOR” the Adjournment Proposal.

Voting of Proxies

If, on the Record Date, your shares are registered directly in your name with our transfer agent, Computershare Trust Company, N.A, you may cause your shares to be voted by returning a signed and dated proxy card in the accompanying prepaid envelope, or you may vote virtually at the Special Meeting. Additionally, you may grant a proxy electronically over the Internet or by telephone (using the instructions provided in the enclosed proxy card). You must have the enclosed proxy card available, and follow the instructions on the proxy card, in order to grant a proxy electronically over the Internet or by telephone. Based on your proxy card or Internet and telephone proxies, the proxy holders will vote your shares according to your directions.

If you plan to attend the Special Meeting and wish to vote virtually, you will need to enter the 16-digit control number found next to the label “Control Number” on your proxy card, or in the email sending you the proxy statement. If you attend the Special Meeting and vote virtually, your vote will revoke any previously submitted proxy. If your shares are registered directly in your name, you are encouraged to vote by proxy even if you plan to attend the Special Meeting virtually.

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Voting instructions are included on your proxy card. All shares represented by properly signed and dated proxies received in time for the Special Meeting will be voted at the Special Meeting in accordance with the instructions of the stockholder. Properly signed and dated proxies that do not contain voting instructions will be voted:

If, on the Record Date, your shares are held in “street name” through a bank, broker or other nominee, you may vote through your bank, broker or other nominee by completing and returning the voting form provided by your bank, broker or other nominee or attending the Special Meeting and voting virtually with a “legal proxy” from your bank, broker or other nominee. If such a service is provided, you may vote over the Internet or telephone through your bank, broker or other nominee by following the instructions on the voting form provided by your bank, broker or other nominee. If you do not return the voting form provided by your bank, broker or other nominee, do not vote via the Internet or telephone through your bank, broker or other nominee, if possible, or do not attend the Special Meeting and vote virtually with a “legal proxy” from your bank, broker or other nominee, it will have the same effect as if you voted “AGAINST” the proposal to adopt the Merger Agreement, but will have no effect on the Compensation Proposal or the Adjournment Proposal.

Revocability of Proxies

If you are a stockholder of record entitled to vote at the Special Meeting, you may change your vote or revoke your proxy at any time before it is voted at the Special Meeting by:

If you have submitted a proxy, your virtual appearance at the Special Meeting will not have the effect of revoking your prior proxy; provided that you do not vote virtually or submit an additional proxy or revocation, which, in each case, will have the effect of revoking your proxy.

If you hold your shares of common stock in “street name,” you should contact your bank, broker or other nominee for instructions regarding how to change your vote. You may also vote virtually at the Special Meeting if you obtain a “legal proxy” from your bank, broker or other nominee.

Adjournments and Recess

Although it is not currently expected, the Special Meeting may be adjourned or recessed to a later date or dates, including for the purpose of soliciting additional proxies if there are insufficient votes at the time of the Special Meeting to approve the proposal to adopt the Merger Agreement or if a quorum is not present at the Special Meeting. Other than an announcement to be made at the Special Meeting of the time, date and place of an adjourned meeting, an adjournment generally may be made without notice. Any adjournment or recess of the Special Meeting for the purpose of soliciting additional proxies will allow the stockholders who have already sent in their proxies to revoke them at any time prior to their use at the Special Meeting as adjourned or recessed.

Board of Directors’ Recommendation

The Board of Directors, after considering various factors described under the caption, “The Merger—Recommendation of the Board of Directors and Reasons for the Merger,” has unanimously: (i) determined that ChannelAdvisor’s entry into the Merger Agreement and the consummation of the Transactions, including the Merger, are advisable

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and fair to, and in the best interests of, ChannelAdvisor and its stockholders, (ii) authorized and approved the execution, delivery and performance by ChannelAdvisor of the Merger Agreement and the consummation of the Transactions, including the Merger and (iii) subject to the terms and conditions of the Merger Agreement, resolved to recommend that the stockholders of ChannelAdvisor adopt the Merger Agreement and approve the Merger and the Transactions.

Accordingly, the Board of Directors unanimously recommends, on behalf of ChannelAdvisor, that you vote: (i) “FOR” the adoption of the Merger Agreement; (ii) “FOR” the Compensation Proposal; and (iii) “FOR” the Adjournment Proposal.

Solicitation of Proxies

The expense of soliciting proxies will be borne by ChannelAdvisor. ChannelAdvisor has retained MacKenzie Partners, Inc. (“MacKenzie”), a proxy solicitation firm, to solicit proxies in connection with the Special Meeting at a cost of approximately $20,000 plus expenses. ChannelAdvisor will also indemnify MacKenzie against losses arising out of its provisions of these services on our behalf. In addition, ChannelAdvisor may reimburse banks, brokers and other nominees representing beneficial owners of shares for their expenses in forwarding soliciting materials to such beneficial owners. Proxies may also be solicited by our directors, officers and employees, personally or by telephone, email, fax, over the Internet or other means of communication. No additional compensation will be paid for such services.

Anticipated Date of Completion of the Merger

We are working toward completing the Merger as quickly as possible. In order to complete the Merger, ChannelAdvisor must obtain the ChannelAdvisor Required Vote described in this proxy statement, and the other closing conditions under the Merger Agreement must be satisfied or waived. Assuming timely satisfaction of the necessary closing conditions, including the approval by stockholders of the proposal to adopt the Merger Agreement, we currently anticipate that the Merger will be consummated in the fourth quarter of 2022, although ChannelAdvisor cannot assure completion by a particular date, if at all. Since the Merger is subject to a number of conditions, the exact timing of the Merger cannot be determined at this time.

Delisting and Deregistration of ChannelAdvisor Common Stock

If the Merger is completed, the shares of ChannelAdvisor’s common stock will be delisted from NYSE and deregistered under the Exchange Act, and shares of ChannelAdvisor’s common stock will no longer be publicly traded. As such, ChannelAdvisor will no longer file periodic reports under the Exchange Act with the SEC on account of ChannelAdvisor’s common stock.

Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be Held on     , 2022

The proxy statement is available on the investor relations page of our website at http://ir.channeladvisor.com/.

Questions and Additional Information

If you have any questions concerning the Merger Agreement, the Merger, the Special Meeting or this proxy statement, would like additional copies of this proxy statement or need help voting your shares of common stock, please contact our proxy solicitor:

MacKenzie Partners, Inc.

1407 Broadway, 27^th Floor

New York, NY 10018

Toll-free: 1-800-322-2885

Email: [email protected]

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THE MERGER

This discussion of the Merger is qualified in its entirety by reference to the Merger Agreement, which is attached to this proxy statement as Annex A and incorporated into this proxy statement by reference. This summary does not purport to be complete and may not contain all of the information about the Merger that is important to you. You should carefully read and consider the entire Merger Agreement, which is the legal document that governs the Merger, because this document contains important information about the Merger and how it affects you.

Parties Involved in the Merger

ChannelAdvisor Corporation

ChannelAdvisor (NYSE: “ECOM”) is a leading multichannel commerce platform whose mission is to connect and optimize the world’s commerce. For over two decades, ChannelAdvisor has helped brands and retailers worldwide improve their online performance by expanding sales channels, connecting with consumers across the entire buying cycle, optimizing their operations for peak performance, and providing actionable analytics to improve competitiveness. Thousands of customers depend on ChannelAdvisor to securely power their e-commerce operations on channels such as Amazon, eBay, Google, Facebook, Walmart, and hundreds more. For more information, visit www.channeladvisor.com. ChannelAdvisor’s principal corporate offices are located at 3025 Carrington Mill Boulevard, Suite 500, Morrisville, NC 27560, and its telephone number is (919) 228-4700.

CommerceHub, Inc.

CommerceHub is a Software as a Service (SaaS) provider with a commerce network connecting the world’s leading retailers and brands with drop ship, marketplace, and delivery solutions. Since 1997, CommerceHub has helped the largest retailers expand their online businesses to expand selection, meet consumer demand, and improve margins. For more information visit www.commercehub.com. CommerceHub’s principal corporate offices are located at 800 Troy-Schenectady Road Suite 100 Latham, NY 12110, and its telephone number is (518) 810-0700.

CH Merger Sub, Inc.

CH Merger Sub, Inc. is a Delaware corporation and a wholly owned subsidiary of CommerceHub and was formed on August 29, 2022, solely for the purpose of engaging in the Transactions. Merger Sub has not engaged in any business activities other than the Transactions. Upon the completion of the Merger, the separate corporate existence of Merger Sub will cease and ChannelAdvisor will continue as the Surviving Corporation. Merger Sub’s principal corporate offices are located at 800 Troy-Schenectady Road Suite 100 Latham, NY 12110, and its telephone number is (518) 810-0700.

In connection with the Transactions, CommerceHub has obtained equity and debt financing commitments. Sixth Street Partners and the other lenders party have delivered a Debt Commitment Letter to CommerceHub and the Investors have each delivered Equity Commitment Letters to CommerceHub, pursuant to which, upon the terms and subject to the conditions set forth in the Equity Commitment Letters, such Investors have committed to capitalize CommerceHub with an aggregate equity contribution of $325 million at the Closing. In addition, the Investors and certain other equityholders of CommerceHub have entered into a limited guarantee, pursuant to which such parties have agreed to guarantee, on a several basis, CommerceHub’s obligation to (i) pay any termination fee to ChannelAdvisor, (ii) reimburse and indemnify ChannelAdvisor with respect to certain expenses in connection with CommerceHub’s Debt Financing and (iii) pay certain other amounts required under the Merger Agreement, subject to the terms thereof. For more information, please see the section of the proxy statement captioned “The Merger—Financing of the Merger.”

Effect of the Merger

Upon the terms and subject to the conditions of the Merger Agreement, Merger Sub will merge with and into ChannelAdvisor, with ChannelAdvisor continuing as the Surviving Corporation and a wholly owned subsidiary of CommerceHub. As a result of the Merger, ChannelAdvisor’s common stock will no longer be publicly traded, and will be delisted from NYSE. In addition, ChannelAdvisor’s common stock will be deregistered under the Exchange Act, and ChannelAdvisor will no longer file periodic reports under the Exchange Act with the SEC. If the Merger is completed, you will not own any shares of the capital stock of the Surviving Corporation.

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The Effective Time will occur upon the filing of a certificate of merger with the Secretary of State of the State of Delaware (or at such later time as we, CommerceHub and Merger Sub may agree in writing and specify in the certificate of merger).

Effect on ChannelAdvisor if the Merger is Not Completed

If the Merger Agreement is not adopted by stockholders, or if the Merger is not completed for any other reason:

For more information, please see the section of this proxy statement captioned “Proposal 1: Adoption of the Merger Agreement—Termination Fee.”

Merger Consideration

At the Effective Time, and without any further action on the part of the parties or any stockholder, each share of common stock issued and outstanding immediately prior to the Effective Time (other than Excluded Shares) will be converted automatically into the right to receive the Merger Consideration, without interest thereon and less any applicable withholding taxes required by applicable legal requirements.

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After the Merger is completed, you will have the right to receive the Merger Consideration in respect of each share of common stock that you own (less any applicable withholding taxes required by applicable legal requirements), but you will no longer have any rights as a ChannelAdvisor stockholder (except that stockholders who properly exercise and perfect their appraisal rights will have a right to receive payment of the “fair value” of their shares as determined pursuant to an appraisal proceeding, as contemplated by Delaware law). For more information, please see the section of this proxy statement captioned “The Merger—Appraisal Rights.”

Background of the Merger

As part of ChannelAdvisor’s ongoing consideration and evaluation of its long-term strategic goals and plans, the Board of Directors, together with ChannelAdvisor management, regularly review and assess ChannelAdvisor’s performance, share price, risks, opportunities and strategy in light of the current business and economic environment, as well as evolving industry dynamics. As a matter of practice and as a way to enhance stockholder value, the Board of Directors and ChannelAdvisor management, together with their professional advisors, regularly review and evaluate a wide range of strategic opportunities for business combinations, acquisitions and other financial and strategic alternatives for ChannelAdvisor, including continuing as a standalone company, with a view to enhance stockholder value.

In 2018 and again in 2019 CommerceHub engaged in preliminary discussions with ChannelAdvisor regarding interest in a potential strategic transaction and, in both instances, CommerceHub terminated such discussions after it had completed substantial diligence on ChannelAdvisor but before any agreement was reached with respect to price or terms.

On January 27, 2022, Mr. Bryan Dove, the Chief Executive Officer of CommerceHub, contacted Mr. David Spitz, Chief Executive Officer of ChannelAdvisor, to discuss a potential commercial arrangement between CommerceHub and ChannelAdvisor.

On February 1, 2022, Mr. Spitz and Mr. Dove had a follow up call to discuss a high-level outline for a potential commercial arrangement during which Mr. Dove raised the prospect of a potential strategic transaction between CommerceHub and ChannelAdvisor. Promptly following the call, Mr. Spitz notified Mr. Marshall A. Heinberg, Mr. Joseph L. Cowan and Mr. Timothy V. Williams, members of the Board of Directors that had been selected by the Board of Directors to review, assess and report to the Board of Directors on potential strategic opportunities based on their respective transactional experience and extensive knowledge of the industry in which ChannelAdvisor operates (the “strategic opportunity working group of the Board of Directors”). The strategic opportunity working group of the Board of Directors instructed Mr. Spitz to have a preliminary conversation with Mr. Dove with respect to a potential strategic transaction during which he could respond to high-level diligence questions about ChannelAdvisor but to note that ChannelAdvisor would need a preliminary indication of value from CommerceHub in order to determine whether to engage in more detailed discussions. The strategic opportunity working group of the Board of Directors also discussed with Mr. Spitz certain best-practices for coordinating discussions with third parties pertaining to a potential strategic transaction and that the Board of Directors, or the working group, on behalf of the Board of Directors, continue to be responsible for directing such discussions.

On February 2, 2022, ChannelAdvisor entered into a non-disclosure agreement with CommerceHub.

On February 11, 2022, Mr. Dove contacted Mr. Spitz to inform him that the board of directors of CommerceHub was actively considering a potential strategic transaction with ChannelAdvisor and anticipated a decision in the following week as to whether CommerceHub would be providing an initial indication of interest.

On February 16, 2022, Mr. Dove contacted Mr. Spitz and indicated that CommerceHub would be sending a written proposal shortly for the acquisition of ChannelAdvisor for $22.90 per share. Later that same day, ChannelAdvisor received an unsolicited non-binding indication of interest from CommerceHub and Insight Partners, a financial sponsor affiliated with CommerceHub, to acquire ChannelAdvisor for $22.90 per share (the “February Proposal”). The February Proposal implied a premium of 27% to the closing price of ChannelAdvisor Common Stock of $18.00 per share on February 16, 2022. The February Proposal noted that the transaction would be funded with a combination of (i) cash on hand, (ii) new equity financing from investment funds affiliated with Insight Partners and limited partners of Insight Partners, and (iii) third-party debt financing. The February Proposal did not include a request for exclusivity. The February Proposal was promptly shared with the strategic opportunity working group of the Board of Directors.

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On February 18, 2022, the strategic opportunity working group of the Board of Directors met with ChannelAdvisor management to discuss the February Proposal. Mr. Spitz reminded the members of the strategic opportunity working group of the Board of Directors of some of the history between CommerceHub and ChannelAdvisor, including that CommerceHub had previously entered into discussions with ChannelAdvisor regarding a potential strategic transaction and that CommerceHub had broken off such discussions after ChannelAdvisor had spent significant time and effort responding to CommerceHub’s information requests. Mr. Spitz noted, however, that CommerceHub had since received a substantial investment from Insight Partners and had a new chief executive officer. The strategic opportunity working group of the Board of Directors discussed the February Proposal as well as additional strategic alternatives and considerations, including the standalone prospects of ChannelAdvisor, the relatively modest premium to ChannelAdvisor’s current stock price, the prior experience with CommerceHub making and then discontinuing an offer to acquire ChannelAdvisor, the risk that engaging in strategic discussions would distract ChannelAdvisor management and disrupt ChannelAdvisor’s business and current market conditions, and determined that such proposal was an insufficient basis on which to continue discussions concerning a potential strategic acquisition and instructed Mr. Heinberg to deliver that message to CommerceHub. Later that day, Mr. Heinberg spoke with a representative of CommerceHub and conveyed that message.

On February 23, 2022, a representative from CommerceHub called Mr. Heinberg and, during this discussion, indicated that CommerceHub could increase its offer to acquire ChannelAdvisor to $24.05 per share (the “February Verbal Proposal”) if CommerceHub could have access to additional non-public information relating to ChannelAdvisor to support an increased valuation.

Later that day, the strategic opportunity working group of the Board of Directors met with members of ChannelAdvisor management present to discuss the February Verbal Proposal during which Mr. Heinberg relayed his conversation with the representative of CommerceHub. Following discussion of potential next steps, the strategic opportunity working group of the Board of Directors directed Mr. Spitz to contact the financial advisor that ChannelAdvisor had previously engaged in connection with its review and consideration of CommerceHub’s prior proposal to acquire ChannelAdvisor in 2019 to determine if it would assist the Board of Directors’ in reviewing and considering the February Verbal Proposal given such financial advisor’s prior relationship and working experience with ChannelAdvisor and CommerceHub, and that ChannelAdvisor was still obligated to pay such financial advisor a fee under certain circumstances relating to a change of control of ChannelAdvisor.

On February 24, 2022, Mr. Spitz contacted a representative of the financial advisor to request assistance and was told that, due to a relationship between an affiliate of such financial advisor and CommerceHub, such financial advisor would not be able to assist ChannelAdvisor. The representative of the financial advisor confirmed that such financial advisor would waive the outstanding obligation to pay such financial advisor a fee relating to a change of control of ChannelAdvisor so that ChannelAdvisor could engage another financial advisor without incurring such additional fee.

On February 25, 2022, the Board of Directors held a meeting with members of ChannelAdvisor management present, during which, the Board of Directors reviewed and discussed the February Proposal, including the response thereto by the strategic opportunity working group of the Board of Directors and the basis for such response, the February Verbal Proposal and the fact that the financial advisor that had previously represented ChannelAdvisor was unable to assist ChannelAdvisor going forward in discussions with CommerceHub due to a potential conflict of interest. The Board of Directors discussed engaging another financial advisor and determined that based on, among other things, the recommendation of a director and the familiarity of other directors with Robert W. Baird & Co. Incorporated (“Baird”), including the strength of Baird’s reputation and experience, specifically in the software and e-commerce industries, that Mr. Heinberg should contact a representative of Baird to determine whether Baird would be willing and able to advise the Board of Directors with respect to reviewing and considering the February Verbal Proposal and other potential strategic transaction opportunities.

On February 27, 2022, Mr. Heinberg confirmed with a representative of Baird that Baird would be willing and able to serve as a financial advisor to ChannelAdvisor and Mr. Heinberg invited representatives of Baird to attend the next meeting of the Board of Directors.

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On February 28, 2022, Mr. Dove met with Mr. Spitz to further discuss the potential commercial arrangement between CommerceHub and ChannelAdvisor. Mr. Dove and Mr. Spitz also briefly discussed the February Verbal Proposal.

On March 3, 2022, the Board of Directors held a meeting with representatives of Baird and Cooley LLP (“Cooley”), ChannelAdvisor’s outside legal counsel, present. At the request of the Board of Directors, representatives of Baird discussed with the Board of Directors certain general market observations based on recent trends, a comparison of ChannelAdvisor’s historical trading prices relative to certain other relevant companies, current analyst research views on ChannelAdvisor, and preliminary views of potential value benchmarks based on different outlook scenarios for ChannelAdvisor. Prior to, and during the meeting, the Board of Directors did not inform representatives of Baird of the amount of the offers previously made by CommerceHub. The Board of Directors meeting then continued in executive session, during which the Board of Directors discussed the February Verbal Proposal in light of the discussion with the representatives of Baird as well as additional strategic alternatives and considerations, including the standalone prospects of ChannelAdvisor, the prior experience with CommerceHub making and then discontinuing an offer to acquire ChannelAdvisor, ChannelAdvisor’s stock price (including historical trading prices), and the risk that engaging in strategic discussions could distract ChannelAdvisor management and disrupt ChannelAdvisor’s business. Taking these factors into account, the Board of Directors determined that such proposal was an insufficient basis on which to engage in discussions concerning a potential strategic transaction and instructed Mr. Heinberg to deliver that message to the representative of CommerceHub. Following the meeting, Mr. Heinberg delivered that message to the representative of CommerceHub and the representative of CommerceHub noted that with access to additional diligence information, CommerceHub may be able to increase its offer. Mr. Heinberg subsequently conveyed that message to the Board of Directors and a determination was made to allow CommerceHub to continue to do additional diligence if it could support an increased offer.

On April 27, 2022, the representative of CommerceHub contacted Mr. Heinberg to note that CommerceHub was continuing to consider a potential strategic transaction with ChannelAdvisor, that it would be in contact again in the coming weeks and that it would affirmatively inform ChannelAdvisor if it determined not to proceed with further discussions with respect to a potential strategic transaction.

On May 10, 2022, ChannelAdvisor received an initial due diligence request list from CommerceHub. From this date to early June 2022, ChannelAdvisor management provided responses to the requests submitted by CommerceHub.

On May 18, 2022, the Board of Directors met with ChannelAdvisor management and representatives of Baird and Cooley present. Representatives of Baird discussed with the Board of Directors certain market observations based on trends, including that the stock market generally, including ChannelAdvisor’s stock price, were down considerably since the last time representatives of Baird had met with the Board of Directors on March 3, 2022, current analyst research views on ChannelAdvisor, and updated views of potential value benchmarks based on different outlook scenarios for ChannelAdvisor. Consistent with the approach taken by the Board of Directors during the meeting on March 3, 2022, prior to and during the meeting, the Board of Directors did not inform the representatives of Baird of the amount of the offers previously made by CommerceHub. Following the discussion between representatives of Baird and the Board of Directors, Mr. Heinberg and Mr. Spitz then updated the Board of Directors on discussions and communications to date with third parties regarding a possible strategic transaction with ChannelAdvisor (a more detailed description of such discussions is provided below). Following this discussion, Cooley reviewed with the Board of Directors its fiduciary duties in connection with a strategic transaction process, including with respect to responding to unsolicited offers.

On June 27, 2022, a representative of CommerceHub contacted Mr. Heinberg to preview that CommerceHub would be delivering a revised written indication of interest to the Board of Directors and that the proposal would be lower than the proposals previously provided in February because market conditions had since softened considerably and that the cost of capital had increased. As part of the discussion, the representative of CommerceHub indicated to Mr. Heinberg that while the revised proposal was not best and final, it did reflect a full valuation of ChannelAdvisor. Later that day, the Board of Directors received a revised written non-binding indication of interest from CommerceHub to acquire ChannelAdvisor for $22.00 per share (the “June Proposal”).

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The June Proposal implied a premium of 51.6% to the closing price of ChannelAdvisor Common Stock of $14.51 per share on June 27, 2022. CommerceHub noted in the June Proposal that its valuation diligence was complete and that it believed that it could complete confirmatory diligence within a few weeks of receiving access to management and additional non-public information. The June Proposal referenced the same financing sources as were referenced in the February Offer and requested that ChannelAdvisor negotiate and enter into a 30-day exclusivity period to complete the negotiation of a definitive transaction agreement. The June Proposal, together with the prior proposals provided by CommerceHub and the other third parties that had expressed interest in a potential strategic transaction with ChannelAdvisor (as described in more detail below), were shared with representatives of Baird so that the representatives of Baird would be prepared to discuss such proposals at the next meeting of the Board of Directors.

Also, on June 27, 2022, Mr. Dove contacted Mr. Spitz to discuss his views of the potential benefits of combining CommerceHub and ChannelAdvisor and in connection with such discussion, confirmed that CommerceHub was done with its valuation diligence and indicated that he believed that CommerceHub could complete confirmatory diligence expeditiously.

On June 28, 2022, the Board of Directors held a meeting, with representatives of Baird and Cooley present. Mr. Heinberg and Mr. Spitz summarized for the Board of Directors the status of discussions and communications to date with third parties regarding a possible strategic transaction with ChannelAdvisor, including the recent communications with CommerceHub in advance of receiving the June Proposal. Mr. Spitz noted that on March 4, 2022 he received unsolicited inbound interest regarding a potential strategic transaction with ChannelAdvisor from representatives of two separate financial sponsors who he knew professionally and had been having informal conversations with for a number of years regarding the industry in which ChannelAdvisor operates, Party A and Party B, and following consultation with the strategic opportunity working group of the Board of Directors, agreed to take calls with each of Party A and Party B to answer their high-level questions about ChannelAdvisor and its business subject to Party B executing a non-disclosure agreement with ChannelAdvisor, which Party B did on March 8, 2022. ChannelAdvisor had previously entered into a binding non-disclosure agreement in August 2021 with Party A in connection with certain preliminary exploratory conversations around potential strategic opportunities. Mr. Spitz noted that Party A then contacted him on March 29, 2022, indicating that it would be willing to send ChannelAdvisor a written non-binding indication of interest to acquire ChannelAdvisor for a range of between $19.75 - $21.50 per share and that he had updated the strategic opportunity working group of the Board of Directors of such verbal indication. Mr. Heinberg recounted the verbal indication from Party A, including that the range proposed was below both the February Proposal and the February Verbal Proposal from CommerceHub that the Board of Directors had previously rejected. The strategic opportunity working group of the Board of Directors determined that such proposal from Party A was an insufficient basis on which to engage in discussions concerning a potential strategic transaction and Mr. Heinberg then delivered that message to Party A. Mr. Spitz then noted that Party A had contacted him again on May 12, 2022 and indicated that it remained interested in pursuing a potential strategic transaction at a valuation consistent with the range that it had previously proposed should ChannelAdvisor be interested. Mr. Spitz then noted that Party B had contacted him in late March of 2022 and mentioned that it had been busy working on other matters but remained interested in a possible strategic transaction with ChannelAdvisor and that it intended to follow up to have discussions on that topic. Mr. Heinberg and Mr. Spitz then noted that (i) they recently had conversations with another financial sponsor, Party C, (ii) on April 4, 2022, unsolicited, Party C expressed an interest in discussing a potential strategic transaction, (iii) at the direction of the strategic opportunity working group of the Board of Directors, ChannelAdvisor entered into a non-disclosure agreement with Party C on May 11, 2022 to facilitate such discussions and (iv) ChannelAdvisor management subsequently had preliminary high-level business diligence discussions with Party C. Mr. Spitz then relayed the conversation he had with a representative of Party C on May 11, 2022 during which Party C indicated that it was currently considering making a proposal to acquire ChannelAdvisor in the range of approximately $19 - $21 per share and after which Mr. Spitz directed the representative of Party C to continue discussions with Mr. Heinberg. Mr. Heinberg then noted to the Board of Directors that Party C contacted him on June 27, 2022 and indicated that, based on publicly available information, Party C was currently considering making a proposal to acquire ChannelAdvisor in the range of $22 - $23 per share. Mr. Heinberg then noted that he recently had received an unsolicited verbal indication of interest regarding a potential strategic transaction from a financial sponsor (Party D) that had originally contacted Mr. Cowan on March 11, 2022 and was then directed by Mr. Cowan to discuss any such matters with Mr. Heinberg. Mr. Heinberg noted that Party D was still thinking through potential valuation for ChannelAdvisor and that it had indicated that it would be back in touch to discuss in more detail. Mr. Spitz then noted that he had recently been contacted, unsolicited, by a financial sponsor (Party E) who he works with from

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time-to-time in an advisory capacity for which he is compensated, and that Party E had mentioned that it was discussing a potential strategic transaction involving ChannelAdvisor with another financial sponsor (Party F) and that they may be interested in having further discussions on the topic together (Parties E and F collectively referred to as “Party EF”). Representatives of Baird then discussed with the Board of Directors current market observations based on recent trends, including the continued compression of valuation multiples for publicly traded SaaS companies. Following such discussion, representatives of Baird discussed a framework for engagement with a select group of strategic and financial partners to gauge potential interest in ChannelAdvisor. The Board of Directors discussed with ChannelAdvisor management and representatives of Baird potential parties to contact, in addition to the parties that had already expressed interest in a possible transaction, in connection with such framework based on an assessment of the parties most likely to be interested in a potential transaction and able to provide an attractive valuation and the importance of limiting both the risk of potential leaks and time investment from management so as not to interfere with current operations of ChannelAdvisor’s business. The Board of Directors meeting then continued in executive session, during which the Board of Directors discussed the current market environment, including the challenges and execution risks associated with operating in current volatile market conditions, the inbound interest received to date with respect to a potential strategic transaction, the risk of a possible larger market downturn and the resulting negative pressure that would put on public company valuations (including ChannelAdvisor’s), and the positives and negatives associated with executing on a targeted outreach framework like the one discussed and determined to undertake such a targeted outreach to, among other things, gain additional market intelligence about ChannelAdvisor. Following such determination, the Board of Directors discussed formalizing the strategic opportunity working group of the Board of Directors by authorizing and forming a transaction committee of the Board of Directors (the “transaction committee”) in order to ensure that the Board of Directors could efficiently manage an appropriate process in connection with soliciting, considering, reviewing and evaluating proposals for a potential strategic transaction as well as any alternatives to a potential strategic transaction, including, ChannelAdvisor continuing to operate as an independent, publicly traded company. The Board of Directors determined to have the current members of the strategic opportunity working group of the Board of Directors serve on the transaction committee based on their respective transactional experience and extensive knowledge of the industry in which ChannelAdvisor operates. In connection with such discussion, Mr. Cowan disclosed to the Board of Directors that in a few prior instances he had provided unpaid advisory services to Party D in connection with potential co-investment opportunities, but that he had never completed any such co-investment opportunities and did not otherwise have any relationship with Party D. The Board of Directors determined that, as such prior advisory relationship was not recent and such relationship was fully disclosed to the Board of Directors, and in light of the benefits of having Mr. Cowan serve on the transaction committee given his extensive experience working on transactions involving financials sponsors, it was in the best interests of the ChannelAdvisor stockholders for Mr. Cowan to serve on the transaction committee. The Board of Directors subsequently approved, by unanimous written consent, the formation of the transaction committee, the appointments of Messrs. Heinberg, Cowan, and Williams to serve on the transaction committee, with Mr. Heinberg to serve as the chairman, and the compensation to be provided to each member of the transaction committee for their service on such committee, as more fully described under the section of this proxy statement “ —Strategic Transaction Committee Compensation”. The Board of Directors also discussed that it would need to evaluate ChannelAdvisor’s long-range plan in connection with making any determinations with respect to a potential strategic transaction. Accordingly, the Board of Directors authorized management to develop the Management Long Range Plan as more fully described under the section of this proxy statement captioned “ —Financial Projections”. The Board of Directors then discussed the formal engagement of Baird as its financial advisor in connection with its review of potential strategic opportunities, noting Baird’s knowledge of the industry in which ChannelAdvisor operates and experience advising companies in connection with potential strategic transactions and the positive experience of the Board of Directors working with Baird to this point. On the basis of these considerations and subject in all respects to the Board of Directors’ understanding Baird’s relevant relationships, the Board of Directors authorized the transaction committee and ChannelAdvisor management to negotiate terms of an engagement letter for the purpose of engaging Baird. The Board of Directors also directed Messrs. Heinberg and Spitz to introduce each of Parties A, B, C, D, and EF to the representatives of Baird so that the representatives of Baird could coordinate such discussions on behalf of ChannelAdvisor going forward and, following the meeting, Messrs. Heinberg and Spitz made such introductions.

On July 5, 2022, the transaction committee met with ChannelAdvisor management and representatives of Cooley present to discuss next steps for undertaking the targeted outreach approved by the Board of Directors and requested that Mr. Spitz work with Baird to provide the transaction committee with a list of the third parties that Baird and ChannelAdvisor management would suggest contacting in connection with such process.

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On July 7, 2022, the transaction committee met with ChannelAdvisor management and representatives of Cooley present to discuss the terms of the Baird engagement and Baird’s relevant relationships, as provided by Baird. Following the discussion, the transaction committee determined to recommend that the Board of Directors engage Baird. Later that same day, the Board of Directors was provided the transaction committee’s recommendation and approved the engagement of Baird as financial advisor to the Board of Directors. The transaction committee also reviewed and discussed the list of third parties prepared by ChannelAdvisor management after discussion with representatives of Baird, which included ten strategic parties, including CommerceHub, and ten financial sponsors, including Parties A, B, C, D and EF. Following such discussion, the transaction committee authorized Baird to contact the parties identified and to continue to consider whether there were other parties that the transaction committee should include in the process.

On July 21, 2022, the Board of Directors met with ChannelAdvisor management and representatives of Cooley present, to review the Management Long Range Plan, which plan had previously been discussed with and reviewed by the transaction committee and the Board of Directors. ChannelAdvisor management reviewed the various estimates and assumptions underlying the Management Long Range Plan. Following review and discussion of the Management Long Range Plan, the Board of Directors (i) adopted the Management Long Range Plan for use in evaluating potential strategic alternatives, including continuing as an independent company, (ii) approved sharing portions of the Management Long Range Plan with potential strategic partners that expressed interest in pursuing a possible strategic transaction and (iii) directed ChannelAdvisor management to direct Baird to use the Management Long Range Plan for purposes of providing financial analyses in connection with the Board of Directors’ evaluation of any potential strategic transaction, including preparing any opinion requested by the Board of Directors.

On July 26, 2022, the transaction committee met with ChannelAdvisor management and representatives of Baird and Cooley present. Representatives of Baird discussed an update with respect to the twenty parties contacted to date by representatives of Baird regarding a potential strategic transaction, which included twelve strategic parties, including CommerceHub, and eight financial sponsors, including Parties A, B, C, D, and EF. Of such parties, representatives of Baird noted that fifteen parties were still considering a potential transaction, which group included both strategic and financial parties. Of the parties that were then still active, thirteen, including CommerceHub and Parties A, B, C, D, and EF (i) had executed non-disclosure agreements with ChannelAdvisor that included a “standstill” provision (but permitted parties to approach ChannelAdvisor privately and confidentially during the standstill period) and a fall-away provision (upon the entry or public announcement of certain acquisition transactions) and (ii) were offered access to diligence information contained in a virtual data room established by ChannelAdvisor. The other two active parties were in the process of negotiating non-disclosure agreements with ChannelAdvisor, one of which did not execute a non-disclosure agreement and determined not to participate in the process and the other strategic party (Party G) subsequently executed a non-disclosure agreement with ChannelAdvisor and was offered access to diligence information contained in the virtual data room. Of the thirteen parties that had executed non-disclosure agreements and were provided data room access, eight conducted calls with management, including CommerceHub, Party D and Party EF. The transaction committee then discussed with representatives of Baird process and timing for soliciting formal indications of interest, including proposed price per share, from the parties still in active discussions regarding a potential strategic transaction and, after taking into consideration the announcement of ChannelAdvisor’s second quarter earnings in early August, determined to request that such indications of interest be submitted on August 15, 2022.

Subsequent to representatives of Baird contacting the twenty parties discussed at the meeting of the transaction committee on July 7, 2022, Mr. Spitz received unsolicited inbound interest regarding a potential strategic transaction with ChannelAdvisor from two additional parties (one strategic and one financial party). After the initial outreach from such parties, Mr. Spitz directed the parties to continue discussions with representatives of Baird. In addition, following discussion with representatives of Baird and the transaction committee, Mr. Spitz contacted an additional strategic party and subsequent to the initial contact, Mr. Spitz directed the additional party to continue discussions with representatives of Baird. Following approval by the transaction committee to engage in discussions with the three parties, two of the parties entered into non-disclosure agreements and were provided data room access and subsequently determined not to pursue a potential strategic transaction with ChannelAdvisor. The other party determined not to participate in the process prior to entering into a non-disclosure agreement. Another strategic party contacted representatives of Baird to express interest in a possible strategic transaction and, at the direction of the transaction committee, such strategic party participated in a call with ChannelAdvisor’s management and following such call, determined not to participate in the process.

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In addition, on July 25, 2022, Party D contacted representatives of Baird to request the ability to partner in connection with a possible strategic transaction with ChannelAdvisor with a financial sponsor and an affiliated portfolio company in which both parties held an ownership position. After discussion between representatives of Baird and the transaction committee, including that by partnering such parties would be better positioned to provide a compelling offer given the potential for possible synergies, the transaction committee determined to permit such parties to partner (references herein to Party D following this date include the financial sponsor and affiliated portfolio company).

From July 27 to August 4, 2022, representatives of Baird sent process emails or made calls to each of the fourteen parties that were then still actively considering a potential strategic transaction with ChannelAdvisor, including CommerceHub and Parties A, B, C, D, and EF, requesting that each such party provide an indication of interest, including proposed price per share, by August 15, 2022. Of the fourteen parties that were contacted by representatives of Baird, other than CommerceHub, Party D, and Party EF, all of the others all determined not to submit an indication of interest.

On August 15, 2022, representatives of Baird received initial indications of interest from each of Party D and Party EF. Party D submitted an indication of interest to acquire ChannelAdvisor for a range of $20.00 to $21.00 per share in cash and noted that it would need equity and debt financing to fund the acquisition and a 45-day period to complete diligence. Party EF submitted an indication of interest to acquire ChannelAdvisor for $20.00 per share in cash and noted that it would need only equity financing to fund the acquisition and a 3 to 4 week period to complete diligence.

Later that day, a representative from Stifel Financial Corp. (“Stifel”), financial advisor to CommerceHub, contacted a representative from Baird to inform Baird that CommerceHub would not be submitting an indication of interest until the following week and that the indication of interest that CommerceHub intended to submit would likely include most of the terms required for the Board of Directors to fully consider such proposal, including drafts of the debt and equity commitment letters to support the financing required to fund the proposed acquisition, and a request for 14-day exclusivity. The representative of Stifel also indicated that CommerceHub expected to have completed substantially all of its diligence by the time it anticipated submitting its proposal and requested that ChannelAdvisor provide a draft of the definitive agreement as soon as one was available.

On August 16, 2022, the Board of Directors met with ChannelAdvisor management and representatives of Baird and Cooley present. Representatives of Baird discussed the terms of both indications of interest and updated the Board of Directors on their discussion with representatives of Stifel regarding the planned timing and substance of CommerceHub’s submission. Representatives of Baird then reviewed their discussion with Party EF, including that Party EF had requested an ability to partner with a financial sponsor that had worked closely with Party EF in the past as a co-investor, and its affiliated portfolio company, so that Party EF could potentially seek to increase the amount included in its initial indication of interest. The Board of Directors discussed each proposal, the price per share provided, the length of time it would likely take each of Party EF and Party D to finalize diligence and be in a position to execute a definitive agreement and the desire to keep Party EF and Party D actively engaged and working to increase their respective submissions so that competitive tension could be maintained in the process. Following discussion, a representative of Cooley reviewed with the Board of Directors the fiduciary duties attendant to a strategic transaction process.

The Board of Directors then discussed next steps and directed representatives of Baird to (i) inform Party EF that it could work with its proposed co-investors in an effort to increase their offer price (references herein to Party EF following this date include the proposed financial and strategic co-investors), (ii) respond to Party EF and Party D with a firm but constructive message indicating that there was a path forward for them if they could meaningfully improve their proposed offer price and could accelerate their timing to deliver improved indications of interest and (iii) provide CommerceHub with the auction draft of the Merger Agreement and to provide Party EF and Party D with the auction draft of the Merger Agreement if they indicated interest in continuing in the process.

Later that day, an auction draft of the Merger Agreement was provided to CommerceHub.

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On August 17, 2022, representatives of Baird contacted representatives of each of Party EF and Party D to convey that their respective price per share offers were too low and that the parties would need to (i) meaningfully raise their offer prices if they wanted to be successful and (ii) narrow their scope of diligence to focus on only material outstanding valuation related items so that they could deliver improved indications of interest as soon as possible. Additionally, representatives of Baird informed Party EF that it could work with its proposed co-investors in connection with preparing an improved proposal and such co-investors entered into non-disclosure agreements shortly thereafter and were provided with access to the virtual data room. Party EF and Party D were each provided with the auction draft of the Merger Agreement the following week.

On August 23, 2022, representatives of Baird received a bid submission from CommerceHub that included an indication of interest to acquire ChannelAdvisor for $23.00 per share in cash (the “August 23^rd Proposal”), a draft Debt Commitment Letter from Sixth Street Partners LLC and draft Equity Commitment Letters from each of UPS, a fund affiliated with Sycamore Partners and funds affiliated with GTCR, a requirement for 14-day exclusivity and a notice that such offer was only valid until August 26, 2022. CommerceHub also included a revised draft of the Merger Agreement, which, among other things, removed the obligation on the part of CommerceHub to pursue divestitures and/or initiate legal proceedings if required in certain circumstances to satisfy antitrust related closing conditions and included a ChannelAdvisor Termination Fee of 3% of ChannelAdvisor equity value and a CommerceHub Termination Fee of 6% of ChannelAdvisor equity value. The August 23^rd Proposal implied a premium of 50.6% to the closing price of ChannelAdvisor Common Stock of $15.27 per share on August 23, 2022.

Later that day, the Board of Directors met with ChannelAdvisor management and representatives of Baird and Cooley present. Representatives of Baird discussed with the Board of Directors certain aspects of the August 23^rd Proposal, including the proposed equity and debt financing package submitted by CommerceHub, and noted that representatives of Baird would be in a position to review certain financial aspects of the August 23^rd Proposal with the Board of Directors the next day. Following initial discussion of the August 23^rd Proposal, the Board of Directors determined to continue discussion the next day so that the Board of Directors could have additional time to consider the August 23^rd Proposal and so that representatives of Baird could complete their financial review of such proposal.

On August 25, 2022, the Board of Directors met, with ChannelAdvisor management and representatives of Baird and Cooley present. Representatives of Baird discussed with the Board of Directors certain financial aspects of the August 23^rd Proposal. Representatives of Baird then noted that each of Party EF and Party D were continuing to review due diligence materials and had requested additional information. The Board of Directors then discussed the August 23^rd Proposal, including the proposed price per share, the inclusion of debt financing and the potential incremental closing risk associated with not having a full equity commitment, the deadline to accept the offer and the request for exclusivity.    Following discussion, the Board of Directors determined not to agree to exclusivity because it would significantly limit ChannelAdvisor’s leverage in any future discussions with CommerceHub, and instructed representatives of Baird to convey to CommerceHub that if CommerceHub would agree to increase its proposal to $24.00 per share, provide equity commitments for the full purchase price and otherwise agreed to work in good faith to provide for a tight set of terms with respect to closing certainty, that ChannelAdvisor would work expeditiously with CommerceHub to finalize terms for a potential transaction.

On August 26, 2022, representatives of Baird provided the message from the Board of Directors to a representative of Stifel, who responded that CommerceHub would not agree to a full equity commitment, that CommerceHub would work in good faith with ChannelAdvisor to provide for closing certainty and that CommerceHub would be submitting a revised indication of interest with its best and final offer. Later that morning, CommerceHub submitted a revised indication of interest for $23.10 per share in cash (the “August 26 Proposal”), which offer noted that it was CommerceHub’s best and final proposal, included a financing package comprised of both equity and debt financing, required a 10-day exclusivity period and noted that the offer was only valid until 4:00 pm eastern time that day. The $23.10 per share offer price implied a premium of 50.7% to the closing price of ChannelAdvisor Common Stock of $15.33 per share on August 26, 2022.

Later that day, the Board of Directors met, with ChannelAdvisor management and representatives of Baird and Cooley present.    Representatives of Baird updated the Board of Directors with respect to the status of Party EF and Party D, noting each had continued to engage and had been conducting discussions with ChannelAdvisor management to close out open diligence items. Representatives of Baird conveyed to the Board of Directors the message that they received from representatives of Stifel earlier that day that CommerceHub would not increase its

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bid price and that CommerceHub would require debt financing. The Board of Directors meeting then continued in executive session, during which the Board of Directors discussed the August 26 Proposal in light of current market dynamics and ChannelAdvisor’s business, including a slowing e-commerce market, intensifying competitive conditions, execution risks attendant to ChannelAdvisor’s future performance and long-term prospects, difficulties in attracting and retaining top talent in the current labor market and the risk of a possible larger market downturn and the resulting negative pressure that would put on public company valuations (including ChannelAdvisor’s), and determined that continuing to pursue a potential strategic transaction was in the best interests of ChannelAdvisor’s stockholders. The Board of Directors then discussed whether to go back to CommerceHub to continue to push for an increased purchase price, but determined that, given the current volatile market conditions, there was substantial risk of losing CommerceHub’s best and final offer of $23.10 per share if ChannelAdvisor continued to pursue a higher price. The Board of Directors directed representatives of Baird to respond to CommerceHub that ChannelAdvisor would not agree to exclusivity, but would continue to work with CommerceHub to finalize the terms of a potential transaction, and that certainty of closing was a key consideration for the Board of Directors and that the Merger Agreement would need to reflect such certainty. The Board of Directors then instructed representatives of Baird to inform Party EF and Party D that the transaction timeline had been accelerated and that the parties needed to submit increased indications of interest as soon as possible and no later than Tuesday, August 30, 2022.

Later that day, Baird conveyed the message from the Board of Directors with respect to CommerceHub, Party EF and Party D.

On August 29, 2022, representatives of ChannelAdvisor provided a revised draft of the Merger Agreement to representatives of CommerceHub, which draft proposed, among other things, a ChannelAdvisor Termination Fee equal to 2.75% of ChannelAdvisor’s equity value, a CommerceHub Termination Fee equal to 10% of ChannelAdvisor’s equity value and a Regulatory Termination Fee equal to 8% of ChannelAdvisor’s equity value.

On August 29, 2022, a representative of Party EF informed representatives of Baird that Party EF would not be submitting an increased indication of interest as they needed considerably more time to undertake additional valuation diligence before it could get to a position where it could potentially consider increasing its prior indication of interest.

On August 30, 2022, Willkie Farr & Gallagher LLP (“Willkie”) provided a revised draft of the Merger Agreement, which draft proposed, among other things, a ChannelAdvisor Termination Fee equal to 4% of ChannelAdvisor’s equity value, a CommerceHub Termination Fee equal to 8% of ChannelAdvisor’s equity value, and a Regulatory Termination Fee equal to 6% of ChannelAdvisor’s equity value.

Later that day, representatives of Baird received a revised indication of interest from Party D for $21.00 per share in cash, which proposal noted that, among other things, Party D anticipated that it would need a period of approximately 4 weeks to complete due diligence and that such proposal was conditioned on ChannelAdvisor agreeing to 28-days of exclusivity. The revised indication of interest from Party D was promptly provided to the Board of Directors and the determination was made not to continue discussions with Party D given that (i) the proposed price per share was materially lower than the $23.10 per share offer from CommerceHub, and (ii) unlike CommerceHub, which had already completed its diligence and was close to completing definitive documentation with respect to a proposed transaction, Party D still had to complete weeks of additional work before it could potentially be in a position to enter into a definitive agreement with no assurance that it would do so.

On August 31, 2022, Cooley sent Willkie a revised draft of the Merger Agreement, which draft proposed, among other things, a ChannelAdvisor Termination Fee equal to 3.15% of ChannelAdvisor’s equity value, a CommerceHub Termination Fee equal to 9% of ChannelAdvisor’s equity value, and a Regulatory Termination Fee equal to 7% of ChannelAdvisor’s equity value.

On September 1, 2022, Willkie sent Cooley a revised draft of the Merger Agreement, which draft proposed, among other things, a CommerceHub Termination Fee equal to 8.5% of ChannelAdvisor’s equity value, a Regulatory Termination Fee equal to 6.5% of ChannelAdvisor’s equity value and agreed to a ChannelAdvisor Termination Fee equal to 3.15% of ChannelAdvisor’s equity value. Later that day, Cooley sent a further revised draft of the Merger Agreement to Willkie which included, among other things, a CommerceHub Termination Fee equal to 8.5% of ChannelAdvisor’s equity value, and a Regulatory Termination Fee equal to 6.5% of ChannelAdvisor’s equity value.

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Throughout September 3, 2022 and the morning of September 4, 2022, the parties worked to finalize the Merger Agreement and related ancillary agreements, including the Debt Commitment Letter, the Equity Commitment Letters and the Limited Guarantee.

On the afternoon of September 4, 2022, the Board of Directors held a meeting, with ChannelAdvisor management and representatives of Baird and Cooley present, to review the terms of the Merger Agreement and related ancillary agreements, and to vote on whether to approve entry into the Merger Agreement with CommerceHub. Representatives of Baird reviewed with the Board of Directors Baird’s financial analyses of CommerceHub’s $23.10 per share proposal. Representatives of Baird then delivered to the Board of Directors the oral opinion of Baird, which was subsequently confirmed in writing via a written opinion dated September 4, 2022, to the effect that, as of that date and based on and subject to various assumptions made, procedures followed, matters considered, and qualifications and limitations on the scope of review undertaken by Baird as set forth in its written opinion, the $23.10 per share in cash to be received by the holders of shares of common stock (other than Excluded Holders) in the Merger pursuant to, and in accordance with, the Merger Agreement was fair, from a financial point of view, to such holders, as more fully described below in the section entitled “—Opinion of Robert W. Baird & Co. Incorporated.” Following the presentation by representatives of Baird, Cooley reviewed with the Board of Directors its fiduciary duties applicable in connection with the strategic transaction process, including the proposed Merger, and the material terms of the draft Merger Agreement and related ancillary agreements. The Board of Directors then discussed the potential transaction with CommerceHub, and, after carefully considering the matters discussed during that meeting and prior meetings of the Board of Directors (for more information, see the section titled “—Reasons for the Merger”), the Board of Directors unanimously (i) determined that entry into the Merger Agreement and the Transactions, were advisable and fair to, and in the best interests of, ChannelAdvisor and its stockholders; (ii) authorized and approved the execution, delivery and performance by ChannelAdvisor of the Merger Agreement and the consummation of the Transactions, including the Merger, and (iii) subject to the terms and conditions of the Merger Agreement, resolved to recommend that the ChannelAdvisor stockholders adopt the Merger Agreement and approve the Merger and the Transactions.

Later in the evening on September 4, 2022, the parties executed the Merger Agreement, the Equity Commitment Letters, the limited guarantee, and the Debt Commitment Letter.

Early in the morning on September 6, 2022, the parties issued a joint press release publicly announcing the Transaction.

Recommendation of the Board of Directors and Reasons for the Merger

Recommendation of the Board of Directors

The Board of Directors has unanimously: (i) determined that the entry into the Merger Agreement and the consummation of the Transactions, including the Merger, are advisable and fair to, and in the best interests of, ChannelAdvisor and its stockholders, (ii) authorized and approved the execution, delivery and performance by ChannelAdvisor of the Merger Agreement and the consummation of the Transactions, including the Merger and (iii) subject to the terms and conditions of the Merger Agreement, resolved to recommend that the stockholders of ChannelAdvisor adopt the Merger Agreement and approve the Merger and the Transactions.

The Board of Directors unanimously recommends, on behalf of ChannelAdvisor, that you vote: (i) “FOR” the adoption of the Merger Agreement; (ii) “FOR” the Compensation Proposal; and (iii) “FOR” the Adjournment Proposal.

Reasons for the Merger

The Board of Directors unanimously recommends, on behalf of ChannelAdvisor, that you vote “FOR” the adoption of the Merger Agreement.

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In the course of reaching its determination and recommendation, the Board of Directors consulted with ChannelAdvisor management, Cooley, and representatives of its independent financial advisor, Baird. The Board of Directors considered the following factors and reasons (which are not listed in any relative order of importance), all of which it viewed as generally supporting its (i) determination that the Merger Agreement and the Transactions, are advisable and fair to, and in the best interest of, ChannelAdvisor and its stockholders, (ii) authorization and approval of the execution, delivery and performance by ChannelAdvisor of the Merger Agreement and the consummation of the Transactions, including the Merger and (iii) subject to the terms and conditions of the Merger Agreement, recommendation that ChannelAdvisor stockholders adopt the Merger Agreement and approve the Merger and the Transactions:

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The Board of Directors also considered certain risks and other potentially negative factors concerning the Merger (which are not necessarily presented in order of relative importance), including:

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In addition to considering the factors described above, the Board of Directors also considered that some of ChannelAdvisor’s directors and executive officers have interests that may be different from, or in addition to, the interests of ChannelAdvisor stockholders generally. The Board of Directors was aware of these interests and considered them at the time it approved the Merger Agreement and made its recommendation to ChannelAdvisor stockholders. For more information, please see the section of this proxy statement entitled “The Merger—Interests of ChannelAdvisor’s Executive Officers and Directors in the Merger”. The foregoing discussion of reasons for the recommendation to adopt the Merger Agreement and approve the Transactions, including the Merger, addresses the reasons considered by the Board of Directors in consideration of its recommendation. In view of the wide variety of reasons considered by the Board of Directors in connection with its evaluation of the Merger and the complexity of these matters, the Board of Directors did not find it practicable to, and did not, quantify or otherwise assign relative weights to the specific reasons considered in reaching its determination and recommendation. Rather, in considering the information and reasons described above, individual members of the Board of Directors each applied his or her own personal business judgment to the process and may have given differing weights to differing factors. The Board of Directors based its unanimous recommendation on the totality of the information presented and concluded that the uncertainties, risks and potentially negative factors relevant to the Merger were outweighed by the potential benefits of the Merger. The explanation of the reasons and reasoning set forth above contain forward-looking statements that should be read in conjunction with the section of this proxy statement entitled “Forward-Looking Statements.”

Financial Projections

While ChannelAdvisor has publicly issued limited guidance concerning aspects of its expected financial performance from time to time, ChannelAdvisor does not, in the ordinary course, publicly disclose forecasts or internal projections as to future performance or results of operations due to the inherent unpredictability of the underlying assumptions and projections. However, in connection with the review of potential strategic alternatives, in July 2022 ChannelAdvisor management, at the direction of the Board of Directors, prepared non-public, unaudited, prospective financial information for fiscal years 2022 through 2027 (the “Management Long Range Plan”). The Management Long Range Plan was discussed with, and approved for use by, the Board of Directors in connection with the evaluation of potential strategic alternatives, including the Merger. The Board of Directors directed Baird to use and rely on the Management Long Range Plan for purposes of Baird’s financial analyses and for rendering its opinion in connection with the Merger. The Management Long Range Plan, excluding unlevered free cash flow, was also approved by the Board of Directors for use by, and provided to, CommerceHub and certain other potential acquirers in connection with their evaluation of a potential strategic transaction with ChannelAdvisor.

Subsequently, in August 2022, ChannelAdvisor management supplemented the Management Long Range Plan, as discussed with Baird, to include revenue and Adjusted EBITDA estimates for ChannelAdvisor for fiscal year 2028 (the “2028 Supplemental Estimates”) so that such information could be used to calculate ChannelAdvisor’s

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terminal value for purposes of its discounted cash flow analysis as more fully described below in the section captioned “—Opinion of Robert W. Baird & Co. Incorporated”. The Management Long Range Plan, together with the 2028 Supplemental Estimates, are referred to herein as the “Projections”. At a meeting of the Board of Directors on August 25, 2022, the 2028 Supplemental Estimates, including the assumptions utilized by ChannelAdvisor management to prepare such estimates (i.e., revenue for fiscal year 2028 was estimated assuming 10% growth over the estimated revenue for fiscal year 2027 included in the Management Long Range Plan and Adjusted EBITDA for 2028 was estimated assuming the same 22% Adjusted EBITDA margin utilized to calculate estimated Adjusted EBITDA for fiscal years 2022 through 2027 in the Management Long Range Plan), were included in the preliminary financial analyses that representatives of Baird reviewed and discussed with the Board of Directors. Later, at a meeting of the Board of Directors on September 4, 2022, ChannelAdvisor management discussed with the Board of Directors the assumptions referenced above that were utilized to prepare the 2028 Supplemental Estimates, including that such estimates had been reasonably prepared on bases reflecting the best currently available judgments of ChannelAdvisor management, and the purpose for which such estimates were prepared by ChannelAdvisor management. The Board of Directors subsequently approved the 2028 Supplemental Estimates for use by Baird for purposes of Baird’s discounted cash flow analysis and for rendering its opinion in connection with the Merger as described below in the section captioned “—Opinion of Robert W. Baird & Co. Incorporated”.

The Projections were not prepared with a view toward public disclosure or toward complying with GAAP, nor were they prepared with a view toward compliance with the published guidelines of the SEC, or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of projections of prospective financial information. The non-GAAP financial measures used in the Projections were relied upon by the Board of Directors in connection with its consideration of the Merger and the Merger Consideration. While ChannelAdvisor believes that such non-GAAP financial measures provide useful supplemental information in analyzing ChannelAdvisor’s financial results, there are limitations associated with the use of such financial measures. Such non-GAAP measures as used by ChannelAdvisor may not be directly comparable to similarly titled measures used by other companies and should not be considered in isolation from, or as a substitute for, financial information presented in accordance with GAAP. The SEC rules, which otherwise would require a reconciliation of a non-GAAP financial measure to a GAAP financial measure, do not apply to non-GAAP financial measures provided to a board of directors or financial advisors in connection with a proposed business combination transaction such as the Transactions if the disclosure is included in a document such as this proxy statement. In addition, reconciliations of non-GAAP financial measures to a GAAP financial measure were not provided to or relied upon by the Board of Directors or Baird in connection with the Merger. Accordingly, ChannelAdvisor has not provided a reconciliation of the financial measures included in the Projections to the relevant GAAP financial measures. The Projections may differ from published analyst estimates and forecasts, and do not take into account any events or circumstances after the date they were prepared, including the announcement of the Transactions.

The Projections reflect estimates and assumptions made by ChannelAdvisor management with respect to general business, economic, competitive, and other market and financial conditions and other future events, all of which are difficult to predict and many of which are beyond ChannelAdvisor’s control. In particular, the Projections, while presented with numerical specificity, necessarily were based on variables and assumptions that are inherently uncertain. Because the Projections cover multiple years, by their nature, they become subject to greater uncertainty with each successive year and are unlikely to anticipate each circumstance that will have an effect on ChannelAdvisor’s business and its results of operations. None of ChannelAdvisor, CommerceHub or any of their respective affiliates, advisors or other representatives makes any representation to any ChannelAdvisor stockholder regarding the validity, reasonableness, accuracy or completeness of the Projections or the ultimate performance of ChannelAdvisor relative to the financial projections. The inclusion of the Projections in this proxy statement does not constitute an admission or representation of ChannelAdvisor that the Projections or the information contained therein is material. Except as required by applicable law, neither ChannelAdvisor nor any of its affiliates intends to, and each of them disclaims any obligation to, update, correct or otherwise revise the Projections if any or all of them have changed or change or otherwise have become, are or become inappropriate (even in the short term). These considerations should be taken into account if evaluating the Projections, which were prepared as of an earlier date.

The Projections should be evaluated, if at all, in conjunction with the historical financial statements and other information regarding ChannelAdvisor in its public filings with the SEC. The Projections were developed by ChannelAdvisor management on a standalone basis without giving effect to the Transactions, including the Merger,

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and therefore the Projections do not give effect to the proposed Transactions or any changes to ChannelAdvisor’s operations or strategy that may be implemented after the consummation of the Merger, including any costs incurred in connection with the Transactions. Furthermore, the Projections do not take into account the effect of any failure of the Transactions to be completed and should not be viewed as accurate or continuing in that context.

The Projections further reflect subjective judgment in many respects and, therefore, are susceptible to multiple interpretations and periodic revisions based on actual experience and business developments. The inclusion of the Projections should not be regarded as an indication that ChannelAdvisor or anyone who received the Projections then considered, or now considers, the Projections to be necessarily predictive of actual future events, and this information should not be relied upon as such. ChannelAdvisor management views the Projections as being subject to inherent risks and uncertainties associated with such long-range projections.

Adjusted EBITDA, levered free cash flow and unlevered free cash flow contained in the Projections set forth below are each “non-GAAP financial measures,” which are financial performance measures that are not calculated in accordance with GAAP. These non-GAAP financial measures should not be viewed as a substitute for GAAP financial measures and may be different from non-GAAP financial measures used by other companies. Furthermore, there are limitations inherent in non-GAAP financial measures because they exclude charges and credits that are required to be included in a GAAP presentation. Accordingly, these non-GAAP financial measures should be considered together with, and not as an alternative to, financial measures prepared in accordance with GAAP.

The information and table set forth below is included solely to give ChannelAdvisor stockholders access to certain of the financial projections that were made available to the Board of Directors, Baird and CommerceHub and is not included in this proxy statement in order to influence any ChannelAdvisor stockholder’s decision to vote with respect to the adoption of the Merger Agreement or for any other purpose:

(dollars in millions)

Opinion of Robert W. Baird & Co. Incorporated

The Board of Directors retained Baird in connection with the Merger and to render an opinion as to the fairness, from a financial point of view, to the holders of ChannelAdvisor’s common stock (other than the Excluded Holders) of the Merger Consideration to be received by such stockholders in the Merger.

On September 4, 2022, Baird delivered its oral opinion (which opinion was subsequently confirmed in writing as of the same date) as to whether, as of the date of such opinion and based upon and subject to the assumptions, procedures, matters, qualifications and limitations set forth therein, Baird was of the opinion that, as of such date, the Merger Consideration to be received by the holders of ChannelAdvisor’s common stock (other than the Excluded Holders) was fair, from a financial point of view, to such stockholders.

The full text of Baird’s written opinion, dated September 4, 2022, which sets forth the assumptions made, procedures followed, matters considered and qualifications and limitations on the review undertaken by Baird in rendering its opinion, is attached as Annex B to this proxy statement and is incorporated herein by reference. Baird’s opinion is directed only to the fairness, as of the date of the opinion and from a financial point of view, to the holders of ChannelAdvisor’s common stock (other than the Excluded Holders) of the Merger Consideration and does not constitute a recommendation to any stockholder as to how such stockholder should vote with respect to the Merger. The summary of Baird’s opinion set forth below is qualified in its entirety by reference to the full text of such opinion attached as Annex B to this proxy statement. Our stockholders are urged to read the opinion carefully in its entirety.

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In conducting its financial analyses and in arriving at its opinion, Baird reviewed such information and took into account such financial and economic factors, investment banking procedures and considerations as Baird deemed relevant under the circumstances. In that connection, and subject to the various assumptions, qualifications and limitations set forth in its opinion, Baird, among other things: (i) reviewed certain internal information, primarily financial in nature, including (A) financial forecasts of ChannelAdvisor for the fiscal years ending December 31, 2022 through 2028 concerning the business and operations of ChannelAdvisor furnished to Baird, and prepared and certified, by ChannelAdvisor management for purposes of its analysis (which we refer to as the “Projections”), and (B) financial statements of ChannelAdvisor for the fiscal years ended December 31, 2018 through 2021 and interim financial statements of ChannelAdvisor for the period ended June 30, 2022, which ChannelAdvisor management prepared and identified as being the most current financial statements available; (ii) reviewed certain publicly available information, including, but not limited to, our recent filings with the SEC; (iii) reviewed the principal financial terms of the draft dated September 4, 2022 of the Merger Agreement in the form then-expected to be presented to the Board of Directors as they related to Baird’s analysis; (iv) compared the financial position and operating results of ChannelAdvisor with those of certain other publicly traded companies Baird deemed relevant; (v) compared the historical market prices, trading activity and market trading multiples of ChannelAdvisor’s common stock with those of certain other publicly traded companies Baird deemed relevant; (vi) compared the proposed Merger Consideration with the reported implied enterprise values of certain other transactions Baird deemed relevant; and (vii) reviewed the certificate from ChannelAdvisor regarding information, financial statements and the Projections addressed to Baird. Baird held discussions with members of ChannelAdvisor management concerning our historical and current financial condition and operating results, as well as the future prospects of ChannelAdvisor. As part of its engagement, Baird was requested to, and Baird did, solicit third-party indications of interest in acquiring all or any part of ChannelAdvisor. Baird was not involved in assisting CommerceHub in obtaining any financing for the Merger. Baird also considered such other information, financial studies, analyses and investigations and financial, economic and market criteria which it deemed relevant for the preparation of its opinion.

In arriving at its opinion, Baird assumed and relied upon, without independent verification:

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In conducting its review, Baird did not undertake or obtain an independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise, known or unknown) or solvency of ChannelAdvisor or CommerceHub, nor did Baird make a physical inspection of the properties or facilities of ChannelAdvisor or CommerceHub. In each case above, Baird made the assumptions and took the actions or inactions described above with our knowledge and consent.

Baird’s opinion necessarily was based upon economic, monetary and market conditions as they existed and could be evaluated on the date of its opinion, and its opinion did not predict or take into account any changes which may have occurred, or information which may have become available, after the date of its opinion. Baird is under no obligation to update, revise, reaffirm or withdraw its opinion, or otherwise comment on or consider events occurring after the date of its opinion. Furthermore, Baird expressed no opinion as to the price or trading range at which any of the securities of ChannelAdvisor (including ChannelAdvisor’s common stock) would trade following the date of its opinion or as to the effect of the Merger on such price or trading range. Such price and trading range may have been affected by a number of factors, including but not limited to (i) dispositions of ChannelAdvisor’s common stock by stockholders within a short period of time after, or other market effects resulting from, the announcement of the Merger and/or the effective date of the Merger; (ii) changes in prevailing interest rates and other factors which generally influence the price of securities; (iii) adverse changes in the current capital markets; (iv) the occurrence of adverse changes in the financial condition, business, assets, results of operations or prospects of ChannelAdvisor or in our industries; (v) any necessary actions by, or restrictions of, federal, state or other governmental agencies or regulatory authorities; and (vi) timely completion of the Merger on terms and conditions that are acceptable to all parties at interest. As the Board of Directors was aware, the credit, financial and stock markets had been experiencing unusual volatility and Baird expressed no opinion or view as to any potential effects of such volatility on the Merger, ChannelAdvisor or CommerceHub and Baird’s opinion did not purport to address potential developments in any such markets. As the Board of Directors was also aware, there was significant uncertainty as to the potential direct and indirect business, financial, economic and market implications and consequences of the spread of the coronavirus and associated illnesses and the actions and measures that countries, central banks, international financing and funding organizations, stock markets, businesses and individuals may take to address the spread of the coronavirus and associated illnesses including, without limitation, those actions and measures pertaining to fiscal or monetary policies, legal and regulatory matters and the credit, financial and stock markets (collectively, the “Pandemic Effects”), and the Pandemic Effects could have a material impact on Baird’s analyses and its opinion.

Baird’s opinion was prepared at the request and for the information of the Board of Directors, and may not be used for any other purpose or disclosed to any other party without Baird’s prior written consent. Baird’s opinion does not address the relative merits or risks of: (i) the Merger, the Merger Agreement or any other agreements or other matters provided for, or contemplated by, the Merger Agreement; (ii) any other transactions that may be, or

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might have been, available as an alternative to the Merger; or (iii) the Merger compared to any other potential alternative transactions or business strategies considered by the Board of Directors and, accordingly, Baird relied upon its discussions with ChannelAdvisor management with respect to the availability and consequences of any alternatives to the Merger. Baird’s opinion does not constitute a recommendation to the Board of Directors, any security holder of ChannelAdvisor or any other person as to how any such person should vote or act with respect to the Merger or whether any stockholder of ChannelAdvisor should make any election with respect to the Merger. Baird expressed no opinion about the fairness of any amount or nature of the compensation or consideration payable to any of our officers, directors or employees, or any class of such persons, or to any particular stockholder relative to the Merger Consideration to be received by the holders of ChannelAdvisor’s common stock. We did not ask Baird to express, and Baird did not express, any opinion with respect to any of the other financial or non-financial terms, conditions, determinations or actions with respect to the Merger.

The following is a summary of the material financial analyses performed by Baird in connection with rendering its opinion, which is qualified in its entirety by reference to the full text of such opinion attached as Annex B and to the other disclosures contained in this section. The following summary, however, does not purport to be a complete description of the financial analyses performed by Baird. The order of analyses described does not represent relative importance or weight given to the analyses performed by Baird. Some of the summaries of the financial analyses include information presented in a tabular format. These tables must be read together with the full text of each summary and alone are not a complete description of Baird’s financial analyses. Except as otherwise noted, the following quantitative information is based on market and financial data as it existed on or before September 2, 2022 and is not necessarily indicative of current market conditions.

Implied Valuation Multiples. Based on the Merger Consideration of $23.10 per share of ChannelAdvisor’s common stock, Baird calculated the implied “equity purchase price” (defined as the Merger Consideration multiplied by the total number of diluted common shares outstanding of ChannelAdvisor, including vested and unvested stock options and accelerated vesting of restricted stock units and performance stock units, to be approximately $724.4 million. In addition, Baird calculated the implied “enterprise value” (defined as the equity purchase price plus the net debt of ChannelAdvisor) to be approximately $647.5 million. Baird then calculated the multiples of the enterprise value to the LTM ended June 30, 2022 revenue and Adjusted EBITDA, each as provided by ChannelAdvisor management, and projected 2022 revenue and Adjusted EBITDA and projected 2023 revenue and Adjusted EBITDA of ChannelAdvisor, each as set forth on the Projections provided by ChannelAdvisor management. Adjusted EBITDA was defined as net income plus or minus: income tax expense (benefit), interest expense (income), depreciation and amortization, stock-based compensation and one-time, non-recurring items. These implied multiples are summarized in the table below.

Selected Public Company Analysis. Baird reviewed certain publicly available financial information and stock market information for certain publicly traded software companies that Baird deemed relevant. The group of selected publicly traded software companies and relevant financial multiples reviewed are listed below.

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Baird chose these software companies, which were selected by Baird in its professional judgment, based on a review of publicly traded companies that possessed general business, operating and financial characteristics relevant to ChannelAdvisor. Baird noted that none of the companies reviewed is identical to ChannelAdvisor and that, accordingly, the analysis of such companies necessarily involves complex considerations and judgments concerning differences in the business, operating and financial characteristics of each company and other factors that affect the public market values of such companies.

Baird calculated the “enterprise value” (defined as the equity market capitalization plus the book value of each company’s total debt and preferred stock, less cash, cash equivalents and marketable securities). Baird calculated the multiples of each company’s enterprise value to its projected 2022 and projected 2023 revenue and Adjusted EBITDA. Stock market and historical financial information for the selected companies was based on publicly available information as of September 2, 2022, and projected financial information was based on publicly available research reports as of such date. A summary of the implied multiples is provided in the table below.

In addition, Baird calculated the implied enterprise value of ChannelAdvisor by applying the multiple ranges of the selected public companies to ChannelAdvisor’s 2022E and 2023E Revenue and Adjusted EBITDA. Baird then took the resulting enterprise values and calculated the implied equity values by adding ChannelAdvisor’s net cash position as of June 30, 2022, and divided these implied values by the fully diluted shares outstanding (including, as applicable, in-the-money options, restricted stock units and performance stock units, using the treasury stock method) to calculate the implied per share values of ChannelAdvisor’s common stock. Baird then compared such values to the Merger Consideration of $23.10 per share.

The implied ranges of per-share value for ChannelAdvisor’s common stock, based on the multiples that Baird deemed relevant, are summarized in the table below.

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Selected Transaction Analysis. Baird reviewed certain publicly available financial information concerning completed or pending acquisition transactions that Baird deemed relevant. The selected acquisition transactions and relevant financial multiples are listed below.

Baird chose these acquisition transactions, which were selected by Baird in its professional judgment, based on a review of completed and pending acquisition transactions involving target software companies that possessed general business, operating and financial characteristics relevant to ChannelAdvisor. Baird noted that none of the acquisition transactions or subject target companies reviewed is identical to the Merger or ChannelAdvisor, respectively, and that, accordingly, the analysis of such acquisition transactions necessarily involves complex considerations and judgments concerning differences in the business, operating and financial characteristics of each subject target company and each acquisition transaction and other factors that affect the values implied in such acquisition transactions.

For each transaction, Baird calculated the implied “equity purchase price” (defined as the purchase price per share of each target company’s common stock multiplied by the total number of diluted common shares outstanding of such company, including gross shares issuable upon the exercise of outstanding stock options and warrants (if any), less assumed option and warrant proceeds (to the extent applicable), and including, where relevant, the value of equity awards accelerated in connection with the transaction, or alternatively defined as the value attributable to the equity of a target company). In addition, Baird calculated the implied “enterprise value” (defined as the equity purchase price plus the book value of each target company’s total debt and preferred stock, less cash, cash equivalents and marketable securities). Baird calculated the multiples of each target company’s implied enterprise price to its LTM Revenue and to its LTM EBITDA. Stock market and historical financial information for the selected transactions was based on publicly available information as of the announcement date of each respective transaction. EBITDA for the selected transaction was adjusted for one-time, non-recurring items. A summary of the implied multiples is provided in the table below.

In addition, Baird calculated the implied enterprise value of ChannelAdvisor by applying the multiple ranges of the selected transactions to ChannelAdvisor’s LTM Revenue and Adjusted EBITDA of $172.1 million and $36.0 million, respectively, each as provided by ChannelAdvisor management. Baird then took the resulting enterprise values and calculated implied equity values by adding ChannelAdvisor’s net cash position as of June 30, 2022, and divided these implied values by the fully diluted shares outstanding (including, as applicable, in-the-money options, restricted stock units and performance stock units, using the treasury stock method) to calculate the implied per share values of ChannelAdvisor’s common stock. Baird then compared such values to the Merger Consideration of $23.10 per share. The implied per share equity values, based on the multiples that Baird deemed relevant, are summarized in the table below.

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Discounted Cash Flow Analysis. Baird performed a discounted cash flow analysis, which is designed to imply a range of potential per-share present values for ChannelAdvisor’s common stock as of June 30, 2022, utilizing the projected unlevered free cash flows of ChannelAdvisor from the second half of 2022 through calendar year 2027 as set forth on the Projections. In such analysis, Baird calculated the implied present value of ChannelAdvisor’s future unlevered free cash flows for the second half of 2022 through calendar year 2027 (which implied present value was calculated using a range of discount rates of 11.0% to 14.0%). Baird then also calculated the implied present value of ChannelAdvisor’s terminal value by multiplying ChannelAdvisor’s 2028 Adjusted EBITDA as set forth on the Projections by a range of diluted enterprise value to next-twelve-months estimated Adjusted EBITDA of 11.0x to 16.0x (which was chosen based on Baird’s professional judgment), and then discounting to present value the resulting values using discount rates ranging from 11.0% to 14.0%. Baird then calculated the sum of the above present values and added ChannelAdvisor’s net cash position as of June 30, 2022 and divided that sum by the fully diluted shares outstanding (including, as applicable, in-the-money options, restricted stock units and performance stock units, using the treasury stock method) resulting in an implied range of values for ChannelAdvisor ChannelAdvisor’s common stock of $19.44 to $28.39 per share, which range was compared by Baird to the Merger Consideration of $23.10 per share.

Transaction Premiums Paid Analysis. Solely for informational purposes, Baird analyzed the stock price premiums paid in merger and acquisition transactions in the technology sector announced since January 1, 2020 with a total transaction value between $500 million and $2 billion where a majority of the target was acquired. Baird measured each transaction price per share relative to each target’s closing price per share one day, seven days and one month prior to announcement of the transaction. The results of the transaction premiums paid analysis are summarized below:

The foregoing summary does not purport to be a complete description of the analyses performed by Baird. The preparation of financial analyses and a fairness opinion is a complex process and is not necessarily susceptible to partial analyses or summary description. Baird believes that its analyses (and the summary set forth above) must be considered as a whole and that selecting portions of such analyses and factors considered by Baird, without considering all of such analyses and factors, could create an incomplete view of the processes and judgments underlying the analyses performed and conclusions reached by Baird and its opinion. Baird did not attempt to assign specific weights to particular analyses. Any estimates contained in Baird’s analyses are not necessarily indicative of actual values, which may be significantly more or less favorable than as set forth therein. Estimates of values of companies do not purport to be appraisals or necessarily to reflect the prices at which companies may actually be sold. Because such estimates are inherently subject to uncertainty, Baird does not assume responsibility for their accuracy.

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Additional Information about Baird and Its Engagement

Pursuant to its engagement, Baird will receive a transaction fee of approximately $9.8 million for its services, substantially all of which is contingent upon the consummation of the Merger. Pursuant to such engagement, ChannelAdvisor has also paid Baird a fee of $1.25 million upon delivery of its opinion, which fee was payable regardless of the conclusion reached in such opinion and is fully creditable against the transaction fee described above. In addition, ChannelAdvisor has agreed to reimburse Baird for certain of its expenses and to indemnify Baird against certain liabilities that may arise out of its engagement. Baird will not receive any other significant payment of compensation contingent upon the successful completion of the Merger. As part of its investment banking business, Baird is engaged in the evaluation of businesses and their securities in connection with mergers and acquisitions, negotiated underwritings, competitive biddings, secondary distributions of listed and unlisted securities, private placements and valuations for estate, corporate and other purposes.

Over the past two years, Baird nor any of its affiliates have provided investment banking or financial advisory services to ChannelAdvisor, CommerceHub or Insight Partners, an affiliate of CommerceHub, for which Baird received any compensation. No material relationship between ChannelAdvisor, CommerceHub, Insight Partners, or any affiliate of ChannelAdvisor, or any other party to the Merger, on the one hand, and Baird, on the other hand, is mutually understood to be contemplated in which any compensation is intended to be received.

Baird is a full service securities firm. As such, in the ordinary course of its business, Baird may from time to time provide investment banking, advisory, brokerage and other services to clients that may be competitors or suppliers to, or customers or security holders of, ChannelAdvisor or CommerceHub or any other party that may be involved in the Merger and their respective affiliates or that may otherwise participate or be involved in the same or a similar business or industry as ChannelAdvisor or CommerceHub. In addition, Baird and certain of its employees and affiliates, as well as investment funds in which they may have financial interests or with which they may co-invest, may from time to time hold or trade the securities of ChannelAdvisor and/or CommerceHub (including ChannelAdvisor’s common stock) for their own account or the accounts of their customers and, accordingly, may at any time hold long or short positions or effect transactions in such securities. In addition, Baird and certain affiliates of Baird and certain of Baird’s and its affiliates’ respective employees may have committed to invest in private equity or other investment funds managed or advised by Insight Partners or certain of its affiliates, and in portfolio companies of such funds, and may have co-invested with other equityholders of CommerceHub or certain of their respective affiliates, and may do so in the future. Baird may also prepare equity analyst research reports from time to time regarding ChannelAdvisor and may serve as a market maker in the publicly traded securities of ChannelAdvisor.

Interests of ChannelAdvisor’s Directors and Executive Officers in the Merger

When considering the recommendation of the Board of Directors that you vote to approve the proposal to adopt the Merger Agreement, you should be aware that some of our directors and executive officers may have interests in the Merger that are different from, or in addition to, the interests of stockholders more generally, as more fully described below. The Board of Directors was aware of and considered these interests, among other matters, to the extent that they existed at the time, in reaching the determination that the Merger Agreement and the Transactions were advisable and fair to and in the best interests of ChannelAdvisor and its stockholders, in reaching its decision to authorize and approve the execution, delivery and performance by ChannelAdvisor of the Merger Agreement and the consummation of the Transactions, in making their recommendation that the stockholders vote in favor of the adoption of the Merger Agreement and approval of the Transactions and in directing that the adoption of the Merger Agreement be submitted to a vote of the stockholders. For more information, please see the section of this proxy statement captioned “The Merger—Interests of ChannelAdvisor’s Directors and Executive Officers in the Merger.”

Arrangements with CommerceHub

As of the date of this proxy statement, none of our executive officers has entered into any agreement with CommerceHub or any of its affiliates regarding employment with, or the right to purchase or participate in the equity of, the Surviving Corporation or one or more of its affiliates. Prior to and following the Closing, however, certain of our executive officers may have discussions, and following the Closing, may enter into agreements with, CommerceHub or the Surviving Corporation, their subsidiaries or their respective affiliates regarding employment with, or the right to purchase or participate in the equity of, the Surviving Corporation or one or more of its affiliates.

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Insurance and Indemnification of Directors and Executive Officers

For more information, please see the section of this proxy statement captioned “Proposal 1: Adoption of the Merger Agreement—Director and Officer Indemnification and Insurance.”

Treatment of ChannelAdvisor Options, ChannelAdvisor RSUs and ChannelAdvisor PSUs

The Merger Agreement provides that, at the Effective Time each:

For more information, please see the section of this proxy statement captioned “Proposal 1: Adoption of the Merger Agreement—Merger Consideration—Treatment of ChannelAdvisor Options, ChannelAdvisor RSUs and ChannelAdvisor PSUs.”

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Payments Upon Termination at or Following Change in Control

ChannelAdvisor has entered into Executive Severance and Change in Control Letter Agreements, each, as amended (the “Letter Agreements”), with each of David J. Spitz, Chief Executive Officer; Richard F. Cornetta, Chief Financial Officer; Elizabeth Segovia, Chief Operating Officer; and Diana S. Allen, Senior Advisor (each, an “executive” and collectively, the “executives”), under which the executives are eligible to receive severance payments and benefits upon certain qualifying terminations of employment, as described below.

Under the Letter Agreements, if the executive’s employment is terminated by ChannelAdvisor other than for cause, or by the executive upon a resignation for good reason, and such termination occurs outside the applicable time frame described below in the event of a change in control transaction, in each case as defined in the Letter Agreement, each executive other than Ms. Allen would receive a lump-sum severance payment equal to the sum of (1) 12 months of then-current base salary, and (2) one calendar quarter of the executive’s then current quarterly variable incentive compensation calculated at 100% achievement if such executive’s compensation includes a quarterly variable incentive component and the termination date is not the last day of the calendar quarter, or a prorated share of any then-current variable compensation calculated at 100% achievement of objectives for the period from the beginning of the calendar year to the date of termination if the executive’s compensation includes an annual variable incentive component and the termination date is not the last day of the calendar year. Ms. Allen would receive a lump-sum severance payment equal to the sum of six months of then-current base salary, plus an additional one month of base salary for each year of service, up to a maximum of 12 months of base salary. Given that Ms. Allen does not participate in the variable incentive program in her current position, she is not entitled to receive any variable incentive compensation as part of her severance benefits under the Letter Agreement. In addition, upon such a termination, each executive would also be entitled to have ChannelAdvisor pay their COBRA medical and dental insurance premiums for up to 12 months or, if earlier, until the executive gains new employment. Additionally, each executive would be entitled to three months of acceleration of time-based vesting conditions for all outstanding and unvested stock options and restricted stock units, including, in the case of Messrs. Spitz and Cornetta and Ms. Segovia, any performance stock units that have been earned based on performance but remain subject to time-based vesting conditions, and the extension of the exercise period for all unexercised stock options until two years after the termination date.

If there is a change in control transaction involving ChannelAdvisor, and, within the period beginning two months before and ending 24 months, or 12 months in the case of Ms. Allen, after the closing of such change in control transaction, the executive’s employment is terminated by ChannelAdvisor (or the acquiring entity) other than for cause, or by the executive’s resignation for good reason, each executive other than Mr. Spitz would be entitled to the applicable payments described above, except that full acceleration would apply in lieu of the partial acceleration described above. Mr. Spitz would receive a lump-sum severance payment equal to the sum of (1) 24 months of his then-current base salary and (2) a prorated share of any of his then-current variable compensation calculated at 100% achievement of objectives for the period from the beginning of the calendar year to the date of termination, and would be entitled to full acceleration in lieu of the partial acceleration described in the preceding paragraph. Mr. Spitz would also be entitled to have ChannelAdvisor (or the acquiring entity) pay his COBRA medical and dental insurance premiums for up to 18 months or, if earlier, until he gains new employment.

The Letter Agreements with Messrs. Spitz and Cornetta and Ms. Segovia contain a “modified cutback” provision, which acts to reduce the benefits payable thereunder that would constitute “parachute payments” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), to the extent necessary so that no excise tax under Section 4999 of the Code would be imposed on such benefits (including with respect to acceleration of equity), but only if doing so would result in the executive retaining a larger after-tax amount. The Letter Agreement with Ms. Allen provides that any “parachute payments” that would be subject to an excise tax under Section 4999 of the Code will be reduced to the minimum extent necessary to avoid application of the excise tax.

Receipt of the benefits described above upon the executive’s termination of employment is contingent upon the executive signing a release of claims in favor of ChannelAdvisor (or the acquiring entity).

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Quantification of Potential Payments to Certain ChannelAdvisor Executive Officers in Connection with the Merger

In accordance with Item 402(t) of Regulation S-K, the table below sets forth the compensation that is based on or otherwise relates to the Merger that will or may become payable to ChannelAdvisor’s named executive officers in connection with the Merger. For more information, please see the section of this proxy statement captioned “The Merger—Payments Upon Termination at or Following Change in Control” for further information regarding certain elements of this compensation.

The table below assumes that:

The amounts shown in the table below do not include the value of payments or benefits that would have been earned, or any amounts associated with equity awards that would vest pursuant to their terms, on or prior to Closing, or the value of payments or benefits that are not based on or otherwise related to the Merger.

In addition to the assumptions described in the preceding paragraph, the amounts set forth in the table below are based on certain other assumptions that are described in the footnotes accompanying the table below. The assumptions based upon which we have estimated the amounts in the table below may or may not actually occur. Accordingly, the ultimate amounts to be received by a named executive officer in connection with the Merger may differ from the amounts set forth below. For purposes of the footnotes to the table below, “single trigger” refers to benefits that arise solely as a result of Closing, and “double trigger” refers to benefits that require two (2) conditions, which are Closing and a qualifying termination. For more information, see the section of this proxy statement captioned “The Merger—Interests of ChannelAdvisor’s Directors and Executive Officers in the Merger” below for a quantification of the amounts that the named executive officers will receive in respect of vested equity awards at the Effective Time.

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Golden Parachute Compensation

Equity Awards Held by ChannelAdvisor’s Executive Officers and Non-Employee Directors

As discussed above in the section of this proxy statement captioned “The Merger—Interests of ChannelAdvisor’s Directors and Executive Officers in the Merger—Treatment of ChannelAdvisor Options, ChannelAdvisor RSUs and ChannelAdvisor PSUs”, at the Effective Time, each Vested Option, Vested RSU, and Vested PSU will be cancelled and automatically converted into the right to receive an amount in cash equal to the product of (i) the aggregate number of shares subject to such award, and (ii) the Merger Consideration (or, for each ChannelAdvisor Option, the excess, if any, of the Merger Consideration over such ChannelAdvisor Option’s per share exercise price).

At the Effective Time, Unvested Options, Unvested RSUs, and Unvested PSUs will be converted into cash-based awards with an equivalent value based on the Merger Consideration (or, for each Unvested Option, the excess, if any, of the Merger Consideration over such ChannelAdvisor Option’s per share exercise price), and such cash-based awards will be subject to the same vesting and forfeiture provisions as were applicable to the ChannelAdvisor Options, ChannelAdvisor RSUs and ChannelAdvisor PSUs immediately prior to the Effective Time, except with respect to the ChannelAdvisor PSUs, for the performance vesting terms rendered inoperative by reason of the Merger. The total number of shares underlying each Unvested PSU will be determined as follows, without regard to actual performance against any applicable performance measures: (A) with respect to the portion of each ChannelAdvisor PSU granted in 2020 that remains subject to vesting as of the Effective Time, at 150% of the target level of performance applicable to such ChannelAdvisor PSUs (based on actual performance following the conclusion of the 2020-2021 performance period), (B) with respect to each ChannelAdvisor PSU granted in 2021, at 200% of the target level of performance applicable to such ChannelAdvisor PSU, as such target is set forth in the applicable award documents, and (C) with respect to each ChannelAdvisor PSU granted in 2022, at 100% of the target level of performance applicable to such ChannelAdvisor PSU, as such target is set forth in the applicable award documents.

Each of our named executive officers is eligible to receive the applicable vesting acceleration benefits with respect to his or her equity awards described above under the section captioned “The Merger—Payments Upon Termination at or Following Change in Control”.

Equity Interests of ChannelAdvisor’s Executive Officers and Non-Employee Directors

The following table sets forth the number of shares of common stock and the number of shares of common stock underlying equity awards held by each of ChannelAdvisor’s executive officers and non-employee directors that are outstanding as of September 20, 2022. The table also sets forth the values of these shares and equity awards, determined as the number of shares multiplied by the Merger Consideration (minus the applicable per share exercise

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price for any ChannelAdvisor Options). Except for the awards described herein, no additional shares of common stock or equity awards were granted to any named executive officer or non-employee director in contemplation of the Merger.

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Strategic Transaction Committee Compensation

The Board of Directors approved a fee of $2,000 for each member of the Strategic Transaction Committee and $3,000 for the chairman payable monthly during the period in which the Strategic Transaction Committee is in existence and actively evaluating and/or executing a potential transaction. Compensation of the Strategic Transaction Committee members was not and is not contingent on the Strategic Transaction Committee approving or recommending the Merger or any other strategic alternative. In addition, the Board of Directors approved a single cash bonus of $35,000 to the chairman of the Strategic Transaction Committee, payable upon the consummation of the Merger.

Financing of the Merger

The obligation of CommerceHub and Merger Sub to consummate the Merger is not subject to any financing condition. CommerceHub and Merger Sub have represented to ChannelAdvisor that they will have available to them, and together with ChannelAdvisor’s cash on hand, sufficient funds to pay the fees and expenses required to be paid at the closing of the Merger by CommerceHub and Merger Sub under the Merger Agreement. This includes funds needed to: (i) pay ChannelAdvisor stockholders the amounts due under the Merger Agreement for their common stock and (ii) make payments in respect of our outstanding ChannelAdvisor Options, ChannelAdvisor RSUs, and ChannelAdvisor PSUs payable at the closing of the Merger pursuant to the Merger Agreement. We anticipate the total amount of funds necessary to complete the Merger and the related transactions, including to pay the Merger Consideration, make the required payments with respect to ChannelAdvisor Options, ChannelAdvisor RSUs, and ChannelAdvisor PSUs payable at the Closing, repay ChannelAdvisor’s outstanding indebtedness, as well as to pay the fees and expenses to be paid at the Closing of the Merger by CommerceHub and Merger Sub under the Merger Agreement, will be approximately $765 million.

In connection with the financing of the Merger, CommerceHub and/or Merger Sub has obtained debt and equity commitments as described below.

Debt Financing

CommerceHub has entered into the Debt Commitment Letter with Sixth Street Partners and the other lenders party thereto pursuant to which, subject to the terms and conditions set forth therein, the lenders thereunder have committed to provide the Debt Financing.

Equity Financing

In connection with the execution of the Merger Agreement, the Investors have each delivered Equity Commitment Letters to CommerceHub, pursuant to which, upon the terms and subject to the conditions set forth in the Equity Commitment Letters, the Investors have committed to capitalize CommerceHub with an aggregate equity contribution of $325 million at the closing of the Merger.

Limited Guarantee

In addition and also concurrently with the execution of the Merger Agreement, the Investors and certain other equityholders of CommerceHub have entered into a limited guarantee, pursuant to which such parties have agreed to guarantee, on a several basis, CommerceHub’s obligation to (i) pay any termination fee to ChannelAdvisor, (ii) reimburse and indemnify ChannelAdvisor with respect to certain expenses in connection with CommerceHub’s Debt Financing and (iii) pay certain other amounts required under the Merger Agreement, subject to the terms thereof.

Financing Cooperation

Each of CommerceHub and Merger Sub will use reasonable best efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things reasonably necessary, proper or advisable to arrange and obtain the financing described in the Commitment Letters.

ChannelAdvisor has agreed to use its reasonable best efforts to provide to CommerceHub and Merger Sub such reasonable cooperation as is requested by CommerceHub in connection with the arrangement of the financing contemplated by the Commitment Letters, subject to the terms set forth in the Merger Agreement.

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Appraisal Rights

If the Merger is consummated and certain conditions are met, stockholders of ChannelAdvisor (i) who continuously hold shares of ChannelAdvisor’s common stock through the effective date of the Merger, (ii) who did not vote their shares in favor of the adoption of the Merger Agreement; (iii) who are entitled to demand appraisal rights under Section 262 of the DGCL, (iv) who otherwise properly comply with the applicable requirements and procedures of Section 262 of the DGCL; and (v) who do not thereafter withdraw their demand for appraisal of such shares, fail to perfect or otherwise lose their appraisal rights, in each case in accordance with Section 262 of the DGCL, will be entitled to demand appraisal of their shares and receive, if the Merger is successful and the Merger is consummated, in lieu of the Merger Consideration, an amount in cash equal to the “fair value” of their shares (as of the Effective Time, exclusive of any element of value arising from the accomplishment or expectation of the Merger, together with interest, if any), as determined by the Delaware Court of Chancery, in accordance with Section 262 of the DGCL. Stockholders should be aware that the fair value of their shares could be more than, the same as or less than the Merger Consideration and that an investment banking opinion as to the fairness, from a financial point of view, of the consideration payable in a sale transaction, such as the Merger, is not an opinion as to, and does not otherwise address, fair value under Section 262 of the DGCL. Any stockholder contemplating the exercise of such appraisal rights should review carefully the provisions of Section 262 of the DGCL, particularly the procedural steps required to properly demand and perfect such rights.

The following is a summary of the procedures to be followed by stockholders who wish to exercise their appraisal rights under Section 262 of the DGCL. A copy of the full text of the version of Section 262 of the DGCL applicable to the Merger Agreement is attached to this proxy as Annex C. This summary does not purport to be a complete statement of, and is qualified in its entirety by reference to, Section 262 of the DGCL. All references in Section 262 of the DGCL and in this summary to a “stockholder” are to the record holder of shares as to which appraisal rights are asserted. A person holding a beneficial interest in shares held of record in the name of another person, such as a broker or nominee, must act promptly to cause the stockholder of record to follow the steps summarized below properly and in a timely manner to perfect appraisal rights. Failure to timely and fully comply with the procedures of Section 262 of the DGCL may result in the loss of appraisal rights under Section 262 of the DGCL. Stockholders should assume that ChannelAdvisor will take no action to perfect any appraisal rights of any stockholder.

Any stockholder who desires to exercise his, her or its appraisal rights should review carefully Section 262 of the DGCL and is urged to consult his, her or its legal advisor before electing or attempting to exercise such rights. The following summary does not constitute any legal or other advice nor does it constitute a recommendation that ChannelAdvisor stockholders exercise appraisal rights under Section 262 of the DGCL.

Under Section 262 of the DGCL, where a merger agreement is to be submitted for adoption at a meeting of the stockholders, the corporation, not less than twenty (20) days prior to the meeting, shall notify each of the stockholders who was such on the record date for notice of such meeting with respect to shares for which appraisal rights are available under Section 262 of the DGCL that appraisal rights are available for any or all shares of such class or series of stock of such constituent corporation, and shall include in such notice a copy of Section 262 of the DGCL. This proxy statement constitutes the formal notice of appraisal rights under Section 262 of the DGCL, and the required copy of Section 262 of the DGCL is attached to this proxy statement as Annex C. Any stockholder who wishes to exercise such appraisal rights or who wishes to preserve his, her or its right to do so should review the following discussion and Annex C carefully because failure to timely and properly comply with the procedures specified may result in the loss of appraisal rights under the DGCL.

If a stockholder elects to exercise appraisal rights under Section 262 of the DGCL, such stockholder must do all of the following:

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Within 10 days after the effective date of the Merger, the Surviving Corporation will provide notice of the effective date of the Merger to those stockholders of ChannelAdvisor who have properly made a written demand for appraisal pursuant to the first bullet above, as required by Section 262 of the DGCL, has not voted in favor of the adoption of the Merger Agreement and has not withdrawn or otherwise lost the right to appraisal. If the Merger is consummated, a failure to make a written demand for appraisal in accordance with the time periods specified in the first bullet above (or to take any of the other steps specified in the above bullets) will be deemed to be a waiver or a termination of your appraisal rights. At any time within sixty (60) days after the effective date of the Merger, any stockholder who has demanded an appraisal, but who has not commenced an appraisal proceeding or joined that proceeding as a named party, has the right to withdraw the demand and to accept the Merger Consideration, specified by the Merger Agreement for his, her or its shares. Any attempt to withdraw made more than sixty (60) days after the effective date of the Merger will require the written approval of the Surviving Corporation and no appraisal proceeding before the Delaware Court of Chancery as to any stockholder will be dismissed without the approval of the Delaware Court of Chancery. Such approval may be conditioned upon any terms the Delaware Court of Chancery deems just; provided, however, that this provision will not affect the right of any stockholder that has made an appraisal demand but who has not commenced an appraisal proceeding or joined such proceeding as a named party to withdraw such stockholder’s demand for appraisal and to accept the terms offered in the Merger within sixty (60) days after the effective date of the Merger. If the Surviving Corporation does not approve a stockholder’s request to withdraw a demand for appraisal when the approval is required or if the Delaware Court of Chancery does not approve the dismissal of an appraisal proceeding, the stockholder would be entitled to receive only the appraised value determined in any such appraisal proceeding. This value could be higher or lower than, or the same as, the value of the Merger Consideration.

Written Demand by the Stockholder

All written demands for appraisal should be addressed to ChannelAdvisor Corporation, 3025 Carrington Mill Boulevard, Suite 500, Morrisville, NC 27560, Attention: Corporation Secretary. The demand for appraisal must be executed by or for the stockholder of record, fully and correctly, as such stockholder’s name appears on the stockholder’s shares (whether in book entry or on physical certificates). If the shares are owned of record in a fiduciary capacity, such as by a trustee, guardian or custodian, the demand should be made in that capacity, and if the shares are owned of record by more than one person, as in a joint tenancy or tenancy in common, the demand must be made by or for all owners of record. An authorized agent, including one or more joint owners, may execute the demand for appraisal for a stockholder of record, but such agent must identify the record owner or owners and expressly disclose in such demand that the agent is acting as agent for the record owner or owners of such shares.

A beneficial owner of shares held in “street name” who wishes to exercise appraisal rights should take such actions as may be necessary to ensure that a timely and proper demand for appraisal is made by the stockholder of record. If shares are held through a broker, bank or other nominee who in turn holds the shares through a central securities depository nominee, such as Cede & Co., a demand for appraisal of such shares must be made by or on behalf of the depository nominee, and must identify the depository nominee as the stockholder of record. Any beneficial owner who wishes to exercise appraisal rights and holds shares through a nominee holder is responsible for ensuring that the demand for appraisal is timely made by the stockholder of record. The beneficial holder of the shares should instruct the nominee holder that the demand for appraisal should be made by the stockholder of record of the shares, which may be a central securities depository nominee if the shares have been so deposited.

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A record stockholder, such as a broker, bank, fiduciary, depository or other nominee, who holds shares as a nominee for several beneficial owners may exercise appraisal rights with respect to the shares held for one or more beneficial owners while not exercising such rights with respect to the shares held for other beneficial owners. In such case, the written demand for appraisal must set forth the number of shares covered by such demand. Unless a demand for appraisal specifies a number of shares, such demand will be presumed to cover all shares held in the name of such stockholder.

Filing a Petition for Appraisal

Within 120 days after the effective date of the Merger, the Surviving Corporation or any stockholder who has complied with Section 262 of the DGCL and is entitled to appraisal rights under Section 262 of the DGCL may commence an appraisal proceeding by filing a petition in the Delaware Court of Chancery demanding a determination of the fair value of the shares held by all stockholders entitled to appraisal rights who did not vote their shares in favor of the Merger and properly demanded appraisal of such shares. If no such petition is filed within that 120-day period, appraisal rights will be lost for all stockholders who had previously demanded appraisal of their shares. None of CommerceHub, Merger Sub or ChannelAdvisor, as the Surviving Corporation, has any obligation to or has any present intention to file a petition and stockholders should not assume that any of the foregoing parties will file a petition or will initiate any negotiations with respect to the fair value of the shares. Accordingly, it is the obligation of the stockholders to initiate all necessary action to perfect their appraisal rights in respect of the shares within the period prescribed in Section 262 of the DGCL.

Within 120 days after the effective date of the Merger, any stockholder who has complied with Section 262 of the DGCL and the requirements for exercise of appraisal rights will be entitled, upon written request, to receive from the Surviving Corporation a statement setting forth the aggregate number of shares not voted in favor of the adoption of the Merger Agreement and with respect to which ChannelAdvisor has received demands for appraisal, and the aggregate number of stockholders of such shares. Such statement must be mailed within ten (10) days after a written request therefor has been received by the Surviving Corporation or within ten (10) days after the expiration of the period for delivery of demands for appraisal, whichever is later. Notwithstanding the foregoing requirement that a demand for appraisal must be made by or on behalf of the record owner of the shares, a person who is the beneficial owner of shares held either in a voting trust or by a nominee on behalf of such person, and as to which demand has been properly made and not effectively withdrawn, may, in such person’s own name, file a petition for appraisal or request from the Surviving Corporation the statement described in this paragraph.

If a petition for appraisal is duly filed by any ChannelAdvisor stockholder and a copy of the petition is delivered to the Surviving Corporation, the Surviving Corporation will then be obligated within twenty (20) days after receiving service of a copy of the petition to file with the Delaware Register in Chancery a duly verified list (the “Verified List”) containing the names and addresses of all stockholders who have demanded an appraisal for their shares (the “Dissenting Stockholders”) and with whom agreements as to the value of their shares has not been reached. Upon the filing of a petition by a Dissenting Stockholder, the Delaware Court of Chancery may order a hearing and that notice of the time and place fixed for the hearing on the petition will be mailed to the Surviving Corporation and all the Dissenting Stockholders shown on the Verified List. Notice will also be published at least one (1) week before the day of the hearing in a newspaper of general circulation published in the City of Wilmington, Delaware, or in another publication deemed advisable by the Delaware Court of Chancery. The costs relating to these notices will be borne by the Surviving Corporation.

If a hearing on the petition is held, the Delaware Court of Chancery is empowered to determine which Dissenting Stockholders have complied with the provisions of Section 262 of the DGCL and are entitled to an appraisal of their shares. The Delaware Court of Chancery may require that Dissenting Stockholders submit their share certificates, if any, to the Delaware Register in Chancery for notation thereon of the pendency of the appraisal proceedings. The Delaware Court of Chancery is empowered to dismiss the proceedings as to any Dissenting Stockholder who does not comply with such requirement. Accordingly, Dissenting Stockholders are cautioned to retain their share certificates after the Effective Time and thereafter comply with all orders of the Delaware Court of Chancery in respect of such certificates. In addition, assuming the shares remain listed on a national securities exchange immediately before the Effective Time, which we expect to be the case, the Delaware Court of Chancery

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is required to dismiss the appraisal proceedings as to all Dissenting Stockholders unless (i) the total number of shares entitled to appraisal exceeds one percent (1%) of the outstanding shares eligible for appraisal or (ii) the value of the consideration provided in the Merger for such total number of shares exceeds $1 million.

Determination of Fair Value

After the Delaware Court of Chancery determines which stockholders are entitled to appraisal, the appraisal proceeding will be conducted in accordance with the rules of the Delaware Court of Chancery, including any rules specifically governing appraisal proceedings. Through the appraisal proceeding, the Delaware Court of Chancery will determine the fair value of the shares exclusive of any element of value arising from the accomplishment or expectation of the Merger, together with interest, if any, to be paid upon the amount determined to be the fair value. Unless the Delaware Court of Chancery in its discretion determines otherwise for good cause shown, interest from the effective date of the Merger through the date of payment of the judgment will be compounded quarterly and will accrue at five percent (5%) over the Federal Reserve discount rate (including any surcharge) as established from time to time during the period between the effective date of the Merger and the date of payment of the judgment. However, at any time before the entry of judgment in the proceedings, the Surviving Corporation may pay to each stockholder entitled to appraisal an amount in cash, in which case interest will accrue thereafter only upon the sum of (i) the difference, if any, between the amount so paid by the Surviving Corporation and the fair value of the shares as determined by the Delaware Court of Chancery, and (ii) interest accrued before such voluntary cash payment, unless paid at that time.

In determining fair value, the Delaware Court of Chancery is to take into account all relevant factors. In Weinberger v. UOP, Inc., the Supreme Court of Delaware discussed the factors that could be considered in determining fair value in an appraisal proceeding, stating that “proof of value by any techniques or methods that are generally considered acceptable in the financial community and otherwise admissible in court” should be considered, and that “fair price obviously requires consideration of all relevant factors involving the value of a company.” The Delaware Supreme Court stated that, in making this determination of fair value, the Delaware Court of Chancery must consider market value, asset value, dividends, earnings prospects, the nature of the enterprise and any other facts that could be ascertained as of the date of the merger that throw any light on future prospects of the merged corporation. In Weinberger, the Supreme Court of Delaware also stated that “elements of future value, including the nature of the enterprise, which are known or susceptible of proof as of the date of the merger and not the product of speculation, may be considered.” Section 262 of the DGCL provides that fair value is to be “exclusive of any element of value arising from the accomplishment or expectation of the merger.” In Cede & Co. v. Technicolor, Inc., the Delaware Supreme Court stated that such exclusion is a “narrow exclusion that does not encompass known elements of value,” but which rather applies only to the speculative elements of value arising from such accomplishment or expectation. An opinion of an investment banking firm as to the fairness from a financial point of view of the consideration payable in a merger is not an opinion as to fair value under Section 262 of the DGCL. You should be aware that the fair value of your shares as determined under Section 262 of the DGCL could be more than, the same as, or less than the merger consideration that you would otherwise be entitled to receive under the terms of the Merger Agreement.

Upon application by the Surviving Corporation or by any stockholder entitled to participate in the appraisal proceeding, the Delaware Court of Chancery may, in its discretion, proceed to trial upon the appraisal prior to the final determination of the stockholders entitled to an appraisal. Any stockholder whose name appears on the Verified List and who has submitted such stockholder’s stock certificates, if any, to the Delaware Register in Chancery, if such is required, may participate fully in all proceedings until it is finally determined that such stockholder is not entitled to appraisal rights. When the fair value of the shares is determined, the Delaware Court of Chancery will direct the payment of such value, with interest thereon, if any, to the stockholders entitled thereto, forthwith in the case of holders of uncertificated stock or upon surrender to the corporation of the certificates representing such shares in the case of certificated stock. The Delaware Court of Chancery’s decree may be enforced as other decrees in the Delaware Court of Chancery may be enforced. The Delaware Court of Chancery may also (i) determine the costs of the proceeding (which do not include attorneys’ fees or the fees and expenses of experts) and tax such costs upon the parties as the Delaware Court of Chancery deems equitable and (ii) upon application of a stockholder, order all or a portion of the expenses incurred by any Dissenting Stockholder in connection with the appraisal proceeding, including, without limitation, reasonable attorneys’ fees and fees and expenses of experts, to be charged pro rata against the value of all the shares entitled to appraisal. In the absence of such an order, each party bears its own expenses. Determinations by the Delaware Court of Chancery are subject to appellate review by the Delaware Supreme Court.

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Stockholders considering whether to seek appraisal should bear in mind that the fair value of their shares determined under Section 262 of the DGCL could be more than, the same as, or less than the value of the Merger Consideration to be paid in the Merger. Although ChannelAdvisor believes that the Merger Consideration is fair, no representation is made as to the outcome of the appraisal of fair value as determined by the Delaware Court of Chancery. Neither CommerceHub nor ChannelAdvisor anticipates offering more than the Merger Consideration to any Dissenting Stockholder, and each of CommerceHub and ChannelAdvisor reserve the right to assert, in any appraisal proceeding, that for purposes of Section 262 of the DGCL, the “fair value” of the shares is less than the Merger Consideration.

The process of exercising appraisal rights requires compliance with technical prerequisites. Stockholders wishing to exercise their appraisal rights should consult with their own legal counsel in connection with compliance with Section 262 of the DGCL.

Any stockholder who has duly demanded and perfected appraisal rights in compliance with Section 262 of the DGCL will not, after the effective date of the Merger, be entitled to vote his, her or its shares for any purpose or be entitled to the payment of dividends or other distributions thereon, except dividends or other distributions payable to stockholders as of a date prior to the Effective Time.

If any stockholder who demands appraisal of shares under Section 262 of the DGCL fails to perfect, successfully withdraws or loses such stockholder’s right to appraisal, such stockholder’s shares will be deemed to have been converted at the Effective Time into the right to receive the Merger Consideration. A stockholder will fail to perfect, or effectively lose, the stockholder’s right to appraisal if no petition for appraisal is filed within 120 days after the effective date of the Merger. Inasmuch as ChannelAdvisor has no obligation to file such a petition and has no present intention to do so, any stockholder who desires such a petition is advised to file it on a timely basis. In addition, a stockholder who has not commenced an appraisal proceeding or joined that proceeding as a named party may withdraw his, her or its demand for appraisal in accordance with Section 262 of the DGCL and accept the Merger Consideration by delivering to ChannelAdvisor a written withdrawal of such stockholder’s demand for appraisal and acceptance of the terms of the Merger either within sixty (60) days after the effective date of the Merger or thereafter with the written approval of ChannelAdvisor. Notwithstanding the foregoing, no appraisal proceeding in the Delaware Court of Chancery will be dismissed as to any stockholder without the approval of the Delaware Court of Chancery, and such approval may be conditioned upon such terms as the Delaware Court of Chancery deems just; provided, however, that the limitation set forth in this sentence will not affect the right of any stockholder who has not commenced an appraisal proceeding or joined that proceeding as a named party to withdraw such stockholder’s demand for appraisal and to accept the Merger Consideration within sixty (60) days after the effective date of the Merger.

STOCKHOLDERS WHO VOTE SHARES IN FAVOR OF THE ADOPTION OF THE MERGER AGREEMENT WILL NOT BE ENTITLED TO EXERCISE APPRAISAL RIGHTS WITH RESPECT THERETO BUT, RATHER, WILL RECEIVE THE MERGER CONSIDERATION.

The foregoing summary of the rights of the stockholders of ChannelAdvisor to seek appraisal rights under Delaware law does not purport to be a complete statement of the procedures to be followed by the stockholders of ChannelAdvisor desiring to exercise any appraisal rights available thereunder and is qualified in its entirety by reference to Section 262 of the DGCL. The proper exercise of appraisal rights requires strict adherence to the applicable provisions of the DGCL. A copy of the version of Section 262 of the DGCL applicable to the Merger Agreement is included as Annex C to this proxy statement.

Accounting Treatment

The Merger will be accounted for as a “purchase transaction” for financial accounting purposes.

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Material U.S. Federal Income Tax Consequences of the Merger

The following discussion is a summary of material U.S. federal income tax consequences of the Merger that may be relevant to U.S. Holders and Non-U.S. Holders (each as defined below). This summary is general in nature and does not purport to be a complete analysis of all potential tax effects. The effects of other U.S. federal tax laws, such as estate and gift tax laws, and any applicable state, local or non-U.S. tax laws are not discussed. This discussion is based upon the Internal Revenue Code of 1986, as amended (the “Code”), Treasury Department regulations promulgated under the Code (the “Treasury Regulations”), court decisions, published rulings and administrative pronouncements of the Internal Revenue Service (the “IRS”), and other applicable authorities, all as in effect on the date of this proxy statement and all of which are subject to change or differing interpretations at any time, possibly with retroactive effect. This discussion is limited to stockholders who hold their shares of common stock as “capital assets” within the meaning of Section 1221 of the Code (generally, property held for investment purposes).

This discussion is for general information only and does not address all of the tax consequences that may be relevant to stockholders in light of their particular circumstances. For example, this discussion does not address the tax consequences that may be relevant to stockholders who may be subject to special treatment under U.S. federal income tax laws, such as:

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If a partnership (including an entity or arrangement, domestic or non-U.S., treated as a partnership for U.S. federal income tax purposes) is a beneficial owner of shares of common stock, then the tax treatment of a partner in such partnership will generally depend upon the status of the partner and the activities of the partner and the partnership. Partnerships holding shares of common stock and partners therein should consult their tax advisors regarding the consequences of the Merger.

We have not sought, and do not intend to seek, any ruling from the IRS with respect to the statements made and the conclusions reached in the following summary, and no assurance can be given that the IRS will agree with the views expressed herein, or that a court will not sustain any challenge by the IRS in the event of litigation.

THE FOLLOWING SUMMARY IS FOR GENERAL INFORMATIONAL PURPOSES ONLY AND IS NOT TAX PLANNING. WE URGE YOU TO CONSULT YOUR OWN TAX ADVISOR WITH RESPECT TO THE SPECIFIC TAX CONSEQUENCES TO YOU IN CONNECTION WITH THE MERGER IN LIGHT OF YOUR OWN PARTICULAR CIRCUMSTANCES, INCLUDING FEDERAL ESTATE, GIFT AND OTHER NON-INCOME TAX CONSEQUENCES, AND TAX CONSEQUENCES UNDER STATE, LOCAL OR NON-U.S. TAX LAWS.

For purposes of this discussion, a “U.S. Holder” is a beneficial owner of shares of common stock that is for U.S. federal income tax purposes:

For purposes of this discussion, a “Non-U.S. Holder” is a beneficial owner of common stock that is not a U.S. Holder nor an entity classified as a partnership for U.S. federal income tax purposes.

U.S. Holders

The receipt of cash by a U.S. Holder in exchange for shares of common stock pursuant to the Merger will be a taxable transaction for U.S. federal income tax purposes. In general, such U.S. Holder’s gain or loss will be equal to the difference, if any, between the amount of cash received by such U.S. Holder and the U.S. Holder’s adjusted tax basis in the shares surrendered pursuant to the Merger. Gain or loss must be determined separately for each block of shares (that is, shares acquired at the same cost in a single transaction). A U.S. Holder’s adjusted tax basis generally will equal the amount that such U.S. Holder paid for the shares. Such gain or loss will be capital gain or loss and will be long-term capital gain or loss if such U.S. Holder’s holding period in such shares is more than one year at the time of the completion of the Merger. Long-term capital gains of non-corporate taxpayers, including individuals, are currently taxed at preferential U.S. federal income tax rates. The deductibility of capital losses is subject to limitations.

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Non-U.S. Holders

Any gain realized by a Non-U.S. Holder pursuant to the Merger generally will not be subject to U.S. federal income tax unless:

Information Reporting and Backup Withholding

Information reporting and backup withholding (currently, at a rate of twenty-four percent (24%)) may apply to the proceeds received by a stockholder pursuant to the Merger. Backup withholding generally will not apply to (1) a U.S. Holder that furnishes a correct taxpayer identification number and certifies that the taxpayer identification number provided is correct and that such stockholder is not subject to backup withholding on IRS Form W-9 (or a substitute or successor form) or (2) a Non-U.S. Holder that (i) provides a certification of such stockholder’s foreign status on the appropriate series of IRS Form W-8 (or a substitute or successor form) or (ii) otherwise establishes an exemption from backup withholding. Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against the stockholder’s U.S. federal income tax liability, if any, provided that the required information is timely furnished to the IRS.

Withholding on Foreign Entities

Sections 1471 through 1474 of the Code and the Treasury Regulations and administrative guidance promulgated thereunder (commonly known as “FATCA”), impose a U.S. federal withholding tax of thirty percent (30%) on certain payments made to a “foreign financial institution” (as specially defined under these rules) unless such institution enters into an agreement with the U.S. government to withhold on certain payments and to collect and provide to the U.S. tax authorities substantial information regarding certain U.S. account holders of such institution (which includes certain equity and debt holders of such institution, as well as certain account holders that are foreign entities with U.S. owners) or an exemption applies. FATCA also generally will impose a U.S. federal withholding tax of thirty percent (30%) on certain payments made to a non-financial foreign entity unless such entity provides the withholding agent with either a certification that it does not have any substantial direct or indirect U.S. owners or provides information regarding substantial direct and indirect U.S. owners of the entity. An intergovernmental agreement between the U.S. and an applicable foreign country may modify these requirements. FATCA withholding currently applies to payments of dividends. The Treasury Department has released proposed regulations which, if finalized in their present form, would eliminate the federal withholding tax of thirty percent (30%) applicable to the gross proceeds of a sale or other disposition of our common stock. In its preamble to such proposed regulations, the Treasury Department stated that taxpayers may generally rely on the proposed regulations until final regulations are issued.

Stockholders are encouraged to consult with their own tax advisors regarding the possible implications of FATCA on the disposition of common stock pursuant to the Merger.

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Regulatory Approvals Required for the Merger

Under the HSR Act, certain acquisitions may not be completed until information has been furnished to the Department of Justice (“DOJ”) and the Federal Trade Commission (“FTC”), and the applicable HSR Act waiting period requirements have been satisfied. The waiting period under the HSR Act applicable to the Merger is thirty (30) calendar days, unless the waiting period is terminated earlier or extended if the parties “pull and refile” the notification and report forms and/or by the issuance of a request for additional information and documentary materials (which we refer to as a “Second Request” herein). If the DOJ or FTC issues a Second Request, the parties must observe a second thirty (30)-day waiting period, which would begin to run only after both parties have substantially complied with such Second Request, unless the waiting period is terminated earlier or the parties agree with the DOJ or FTC to delay consummation of the Merger for a specified period of time.

The Merger is subject to the provisions of the HSR Act and therefore cannot be completed until each of ChannelAdvisor and CommerceHub file a notification and report form with the DOJ and the FTC under the HSR Act and the applicable waiting period has expired or been terminated.

At any time before or after consummation of the Merger, notwithstanding the termination or expiration of the waiting period under the HSR Act, the DOJ or the FTC could take such action under the antitrust laws as either deems necessary or desirable in the public interest, including seeking to enjoin the completion of the Merger, seeking divestiture of substantial assets of one or both of the parties, requiring the parties to license or hold separate assets or terminate existing relationships and contractual rights, or requiring the parties to agree to other remedies. At any time before or after the completion of the Merger, and notwithstanding the termination or expiration of the waiting period under the HSR Act, any state or foreign jurisdiction could take such action under the antitrust laws as it deems necessary or desirable in the public interest. Such action could include seeking to enjoin the completion of the Merger, seeking divestiture of substantial assets of one or both of the parties, requiring the parties to license or hold separate assets or terminate existing relationships and contractual rights, or requiring the parties to agree to other remedies. Private parties may also seek to take legal action under the antitrust laws under certain circumstances, including by seeking to intervene in the regulatory process or litigate to enjoin the Merger or to overturn regulatory approvals, any of which actions could significantly impede or preclude obtaining required regulatory approvals. We cannot be certain that a challenge to the Merger will not be made or that, if a challenge is made, we will prevail.

Although we expect that all required regulatory clearances and approvals will be obtained, we cannot assure you that these regulatory clearances and approvals will be timely obtained, obtained at all or that the granting of these regulatory clearances and approvals will not involve the imposition of additional conditions, restrictions, qualifications, requirements or limitations on the completion of the Merger, including the requirement to divest assets, license or hold separate assets or terminate existing relationships and contractual rights, or agree to other remedies, or require changes to the terms of the Merger Agreement, or that a challenge to the Merger on antitrust grounds will not be made, or if such challenge is made, what the result will be. These conditions or changes could result in the conditions to the Merger not being satisfied. There is currently no way to predict how long it will take to obtain all of the required regulatory approvals or whether such approvals will ultimately be obtained and there may be a substantial period of time between the approval of the proposal to adopt the Merger Agreement by stockholders and the completion of the Merger.

ChannelAdvisor and CommerceHub have agreed to use reasonable best efforts to obtain all regulatory approvals required to consummate the Transactions, including the Merger, subject to certain limitations as set forth in the Merger Agreement. As set forth in the Merger Agreement, CommerceHub is not required to agree certain actions, commitments, agreements, conditions or restrictions with governmental bodies, and CommerceHub has the right to control the strategy for obtaining governmental authorizations, subject to the terms and conditions of the Merger Agreement.

Legal Proceedings

As of the filing of this proxy statement, there were no legal proceedings pending related to the Merger.

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PROPOSAL 1: ADOPTION OF THE MERGER AGREEMENT

The following summary describes the material provisions of the Merger Agreement. The descriptions of the Merger Agreement in this summary and elsewhere in this proxy statement are not complete and are qualified in their entirety by reference to the Merger Agreement, a copy of which is attached to this proxy statement as Annex A and incorporated into this proxy statement by reference. You should carefully read and consider the entire Merger Agreement, which is the legal document that governs the Merger, because this summary may not contain all the information about the Merger Agreement that is important to you. The rights and obligations of the parties are governed by the express terms of the Merger Agreement and not by this summary or any other information contained in this proxy statement.

The representations, warranties, covenants and agreements described below and included in the Merger Agreement (i) were made only for purposes of the Merger Agreement and as of specific dates; (ii) were made solely for the benefit of the parties to the Merger Agreement; and (iii) may be subject to important qualifications, limitations and supplemental information agreed to by ChannelAdvisor, CommerceHub and Merger Sub in connection with negotiating the terms of the Merger Agreement and contained in the confidential disclosure schedules. In addition, the representations and warranties have been included in the Merger Agreement for the purpose of allocating contractual risk between ChannelAdvisor, CommerceHub and Merger Sub rather than to establish matters as facts, and may be subject to standards of materiality applicable to such parties that differ from those applicable to stockholders. Stockholders are not third-party beneficiaries under the Merger Agreement and should not rely on the representations, warranties, covenants and agreements or any descriptions thereof as characterizations of the actual state of facts or condition of ChannelAdvisor, CommerceHub or Merger Sub or any of their respective affiliates or businesses. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Merger Agreement. In addition, you should not rely on the covenants in the Merger Agreement as actual limitations on the respective businesses of ChannelAdvisor, CommerceHub and Merger Sub, because the parties may take certain actions that are either expressly permitted in the confidential disclosure schedule to the Merger Agreement or as otherwise consented to by the appropriate party, which consent may be given without prior notice to the public. The Merger Agreement is described below, and included as Annex A, only to provide you with information regarding its terms and conditions, and not to provide any other factual information regarding ChannelAdvisor, CommerceHub, Merger Sub or their respective businesses. Accordingly, the representations, warranties, covenants and other agreements in the Merger Agreement should not be read alone, and you should read the information provided elsewhere in this document and in our filings with the SEC regarding ChannelAdvisor and its business.

Effects of the Merger; Certificate of Incorporation; Bylaws; Directors and Officers

The Merger Agreement provides that, upon the terms and subject to the conditions of the Merger Agreement and in accordance with the DGCL, at the Effective Time: (i) Merger Sub will be merged with and into ChannelAdvisor, with ChannelAdvisor continuing as the Surviving Corporation; and (ii) the separate existence of Merger Sub will cease. From and after the Effective Time, all properties, rights, privileges, powers and franchises of ChannelAdvisor and Merger Sub will vest in the Surviving Corporation, and all of the debts, liabilities and duties of ChannelAdvisor and Merger Sub will become the debts, liabilities and duties of ChannelAdvisor as the Surviving Corporation.

At the Effective Time, the certificate of incorporation of ChannelAdvisor as the Surviving Corporation will be amended and restated to conform to Exhibit B of the Merger Agreement and the bylaws of ChannelAdvisor as the Surviving Corporation will be amended and restated to conform to Exhibit C of the Merger Agreement. Immediately after the Effective Time, the directors and officers of ChannelAdvisor as the Surviving Corporation will be the respective individuals who were designated by ChannelAdvisor, CommerceHub and Merger Sub as the directors and officers in a schedule to the Merger Agreement.

Closing and Effective Time

The Closing of the Merger will take place no later than the third business day after the satisfaction or waiver of all of the closing conditions of the Merger (described below under the caption, “—Conditions to the Closing of the Merger”) (other than those conditions to be satisfied at the Closing of the Merger) . On the Closing Date, the parties will file a certificate of merger with the Secretary of State of the State of Delaware in accordance with the DGCL. The Merger will become effective upon the date and time of the filing of the certificate of merger or such later date and time as is agreed upon in writing by the parties and specified in such certificate of merger.

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Merger Consideration

Common Stock

Subject to the terms of the Merger Agreement, at the Effective Time, each share of common stock issued and outstanding immediately prior to the Effective Time (except for Excluded Shares) will be converted automatically into the right to receive Merger Consideration, subject to any withholding of taxes required by applicable legal requirements.

At the Effective Time, each share of common stock of Merger Sub outstanding immediately prior to the Effective Time will be converted into one validly issued, fully paid and nonassessable share of common stock of the Surviving Corporation.

Treatment of ChannelAdvisor Options, ChannelAdvisor RSUs and ChannelAdvisor PSUs

Vested ChannelAdvisor Options. As of the Effective Time, each Vested Option will be cancelled and automatically converted into the right to receive an amount in cash, without interest thereon, equal to the product of (A) the total number of shares of common stock underlying such Vested Option, multiplied by (B) the excess, if any, of (1) the Merger Consideration over (2) the per share exercise price for such Vested Options, less applicable tax withholdings.

Unvested ChannelAdvisor Options. As of the Effective Time, each Unvested Option will be cancelled and replaced with a right to receive an amount in cash, without interest thereon, equal to the Cash Replacement Option Amounts, which Cash Replacement Option Amounts will, subject to the holder’s continued service with CommerceHub or its affiliates through the applicable vesting dates, vest and be payable at the same time as the Unvested Option for which such Cash Replacement Option Amounts were exchanged would have vested pursuant to its terms.

Vested RSUs. As of the Effective Time, each Vested RSU will be cancelled and converted into and will become the right to receive (without interest) an amount in cash equal to (A) the total number of shares of common stock underlying such Vested RSU, multiplied by (B) the Merger Consideration, less applicable tax withholdings.

Unvested RSUs. As of the Effective Time, each Unvested RSU will be replaced with a right to receive an amount in cash, without interest thereon, equal to the Cash Replacement RSU Amounts, less applicable tax withholdings, which Cash Replacement RSU Amounts will, subject to the holder’s continued service with CommerceHub or its subsidiaries through the applicable vesting dates, vest and be payable at the same time as the Unvested RSUs for which such Cash Replacement RSU Amounts were exchanged would have vested and been payable pursuant to their terms.

Vested PSUs. As of the Effective Time, each Vested PSU will be cancelled and converted into and will become the right to receive (without interest) an amount in cash equal to (A) the total number of shares of common stock underlying such Vested PSU, multiplied by (B) the Merger Consideration, less applicable tax withholdings.

Unvested PSUs. As of the Effective Time, each Unvested PSU will be replaced with a right to receive an amount in cash, without interest, equal to Cash Replacement PSU Amounts, less applicable tax withholdings, which Cash Replacement PSU Amounts will, subject only to the holder’s continued service with CommerceHub or one of its subsidiaries through the applicable vesting dates, vest and be payable at the same time as the Unvested PSUs for which such Cash Replacement PSU Amounts were exchanged would have vested and been payable pursuant to their terms. The total number of shares of common stock underlying each unvested ChannelAdvisor PSU will be determined as follows, without regard to actual performance against any applicable performance measures: (A) with respect to the portion of each ChannelAdvisor PSU granted in 2020 that remains subject to vesting as of the Effective Time, at 150% of the target level of performance applicable to such ChannelAdvisor PSUs (based on actual performance following the conclusion of the 2020-2021 performance period), (B) with respect to each ChannelAdvisor PSU granted in 2021, at 200% of the target level of performance applicable to such PSU, as such target is set forth in the applicable award documents, and (C) with respect to each ChannelAdvisor PSU granted in 2022, at 100% of the target level of performance applicable to such ChannelAdvisor PSU, as such target is set forth in the applicable award documents.

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Exchange and Payment Procedures

Prior to the Effective Time, CommerceHub will designate a paying agent (“Paying Agent”) for the holders of record of any shares of common stock entitled to receive the Merger Consideration at the Effective Time. At or prior to the Closing, CommerceHub will deposit or cause to be deposited with the Paying Agent cash sufficient, when taken together with the amount of ChannelAdvisor’s cash on hand, to pay the aggregate amount of Merger Consideration payable at the Effective Time pursuant to the Merger Agreement.

As promptly as practicable after the Effective Time (and in any event within three business days), CommerceHub will cause the Paying Agent to mail or otherwise provide to each holder of record of any shares entitled to receive the Merger Consideration transmittal materials, including a customary form of letter of transmittal and instructions for surrendering any certificates or book-entry shares in exchange for the Merger Consideration for each share formerly evidenced by such certificates or book-entry shares.

As soon as reasonably practicable after the Effective Time, with respect to any vested equity award, and the applicable vesting date, with respect to any unvested equity award, but in each case no earlier than the first regularly scheduled payroll date that is at least three business days following the Effective Time or the applicable vesting date (but in no event later than the later of ten days and the second regularly scheduled payroll date, in each case, following the Effective Time or the applicable vesting date), as applicable, CommerceHub will, or will cause the Surviving Corporation or a subsidiary of the Surviving Corporation to, pay through the Surviving Corporation’s or the applicable subsidiary’s payroll the aggregate Vested Option consideration, Cash Replacement Option Amounts, Vested RSU consideration, Cash Replacement RSU Amounts, the Vested PSU consideration and the Cash Replacement PSU Amounts payable with respect to Company Options, RSUs and PSUs held by current or former employees of ChannelAdvisor or its subsidiaries (net of any payroll taxes required to be deducted and withheld by applicable legal requirements); but to the extent the holder of a Company Option, RSU or PSU is not, and was not at any time during the vesting period of the Company Option, RSU or PSU, an employee of ChannelAdvisor or its subsidiaries for employment tax purposes, the Vested Option consideration, Vested RSU consideration, or Vested PSU consideration, if any, payable with respect to such Company Option, RSU or PSU will be paid by the Paying Agent.

The Surviving Corporation, CommerceHub and Merger Sub may deduct and withhold any applicable taxes from any consideration payable pursuant to the Merger Agreement.

Representations and Warranties

The Merger Agreement contains representations and warranties of ChannelAdvisor, CommerceHub and Merger Sub. Some of the representations and warranties in the Merger agreement made by ChannelAdvisor are qualified as to “materiality” or “Material Adverse Effect.” For purposes of the Merger Agreement, a fact, event, occurrence, effect, change, development or circumstance (each, an “Effect”) that is deemed to have a “Material Adverse Effect” on ChannelAdvisor and its subsidiaries, taken as a whole, if such Effect, individually or in the aggregate, has had, or would reasonably be expected to have a material adverse effect on the assets, liabilities, business, condition (financial or otherwise) or results of operations of ChannelAdvisor and its subsidiaries, taken as a whole, provided that, none of the following will be deemed in and of themselves, either alone or in combination, to constitute a Material Adverse Effect on ChannelAdvisor and its subsidiaries, and none of the following will be taken into account in determining whether there is, or would reasonably likely to be, a Material Adverse Effect on ChannelAdvisor and its subsidiaries:

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In the Merger Agreement, ChannelAdvisor has made customary representations and warranties to CommerceHub and Merger Sub that are subject, in some cases, to specified exceptions and qualifications contained in the Merger Agreement. These representations and warranties relate to, among other things:

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In the Merger Agreement, CommerceHub and Merger Sub have made customary representations and warranties to ChannelAdvisor that are subject, in some cases, to specified exceptions and qualifications contained in the Merger Agreement. These representations and warranties relate to, among other things:

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The representations and warranties contained in the Merger Agreement will not survive the consummation of the Merger.

Conduct of Business Pending the Merger

The Merger Agreement provides that during the pre-Closing period, except as: (i) expressly required or otherwise expressly contemplated by the Merger Agreement or as required by applicable legal requirements; (ii) consented to by CommerceHub in writing (which consent will not be unreasonably withheld, delayed or conditioned); or (iii) disclosed in ChannelAdvisor’s disclosure letter to the Merger Agreement, ChannelAdvisor will use commercially reasonable efforts to (x) conduct and ensure that ChannelAdvisor and its subsidiaries conduct their business in the ordinary course of business and (y)(1) preserve intact the business and material operations of ChannelAdvisor and its subsidiaries and (2) keep available all of the material services of its directors, officers and material employees of ChannelAdvisor or any of its subsidiaries; provided that the foregoing interim operating covenants do not prohibit ChannelAdvisor and of its subsidiaries from taking commercially reasonable actions (in consultation with CommerceHub to the extent reasonably practicable) in response to the actual or anticipated effects of the COVID-19 pandemic or any COVID-19 responses.

Additionally, the Merger Agreement provides that during the pre-Closing period, except as: (i) expressly required or otherwise expressly contemplated by the Merger Agreement or as required by applicable legal requirements; (ii) consented to by CommerceHub in writing (which consent will not be unreasonably withheld, delayed or conditioned); or (iii) disclosed in ChannelAdvisor’s disclosure letter to the Merger Agreement, ChannelAdvisor and its subsidiaries will not, among other things:

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Notwithstanding the foregoing, nothing contained in the Merger Agreement will give to CommerceHub or Merger Sub, directly or indirectly, rights to control or direct the operations of ChannelAdvisor or its subsidiaries prior to the Effective Time. Prior to the Effective Time, each of CommerceHub and ChannelAdvisor will exercise, consistent with the terms and conditions of the Merger Agreement, complete control and supervision of its and its subsidiaries’ operations.

No Solicitation of Other Offers

For purposes of this proxy statement and the Merger Agreement:

“Acceptable Confidentiality Agreement” means any customary confidentiality agreement that (i) contains provisions that are no less favorable in the aggregate to ChannelAdvisor and its subsidiaries than those contained in the Confidentiality Agreement dated February 2, 2022, between ChannelAdvisor and CommerceHub (the “Confidentiality Agreement”) (except that the confidentiality agreement need not contain standstill provisions) and (ii) does not prohibit ChannelAdvisor or any of its subsidiaries from complying with its obligations under the Merger Agreement, including from providing any information to CommerceHub in accordance with the Merger Agreement.

“Acquisition Proposal” means any bona fide, written proposal or offer from any person (other than CommerceHub and its affiliates) or “group”, within the meaning of Section 13(d) of the Exchange Act, relating to, in a single transaction or series of related transactions, any direct or indirect:

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“Superior Proposal” means a bona fide written Acquisition Proposal made by a third party after the date of the Merger Agreement that the Board of Directors (or committee thereof) determines, in its good faith judgment, is reasonably likely to be completed, taking into account all legal, regulatory and financing aspects of the proposal and the person making the proposal and other aspects of the Acquisition Proposal that the Board of Directors (or committee thereof) deems relevant and if consummated, would result in a transaction more favorable to ChannelAdvisor’s stockholders (solely in their capacities as such) from a financial point of view than the Transactions. For purposes of the definition of “Superior Proposal”, the references to “20%” in the definition of Acquisition Proposal are deemed to be references to “50%.”

During the pre-Closing period, ChannelAdvisor and its subsidiaries and their respective officers and directors have agreed not to, and will direct their respective representatives not to, indirectly or directly:

In addition, as soon as reasonably practicable after the date of the Merger Agreement (and in any event within three (3) business days of the date of the Merger Agreement), ChannelAdvisor and its subsidiaries agreed to direct their respective representatives to (i) deliver a written notice to each person (other than CommerceHub) that entered into a confidentiality agreement in anticipation of potentially making an Acquisition Proposal within the preceding nine months, stating that ChannelAdvisor is ending all discussions and negotiations with such person with respect to any Acquisition Proposal, effective immediately, and such notice shall also request such person to promptly return or destroy all confidential information concerning ChannelAdvisor and its subsidiaries and (ii) terminate data room access previously granted to any persons and its representatives (other than CommerceHub and its representatives) in connection with any Acquisition Proposal or Inquiry.

In the event that prior to the receipt of the ChannelAdvisor Required Vote, ChannelAdvisor, its subsidiaries or any of their representatives receives an Acquisition Proposal from any person or group of persons, which was made, renewed or reaffirmed on or after the date of the Merger Agreement and did not result from any breach of the non-solicitation obligations in the Merger Agreement, ChannelAdvisor and its representatives may contact and engage in discussions with such person or group of persons to clarify the terms and conditions of such Acquisition Proposal and inform such person or group of persons of the terms of the Merger Agreement and if the Board of Directors (or a committee thereof) determines in good faith, after consultation with its financial advisors and outside legal counsel, that such Acquisition Proposal constitutes or could reasonably be expected to lead to a Superior Proposal and the Board of Directors (or a committee thereof) determines in good faith, after consultation with outside legal counsel, that the failure to take such action could reasonably be expected to lead to a breach of its fiduciary duties under applicable legal requirements, then ChannelAdvisor and its representatives may (A) enter into an Acceptable Confidentiality Agreement and furnish, pursuant to such Acceptable Confidentiality Agreement, information (including non-public information) with respect to ChannelAdvisor and its subsidiaries to the person or group of persons who has made such Acquisition Proposal; provided that ChannelAdvisor will concurrently provide to CommerceHub any non-public information concerning ChannelAdvisor and its subsidiaries that is provided to any person given such access which was not previously provided to CommerceHub or its representatives and (B) engage in or otherwise participate in discussions or negotiations with the person or group of persons making such Acquisition Proposal and their respective representatives and financing sources with respect to such Acquisition Proposal.

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Relatedly, following the date of the Merger Agreement, ChannelAdvisor has also agreed to (i) promptly (and in any event within 24 hours) notify CommerceHub in writing if any Acquisition Proposal or any Inquiries are received by ChannelAdvisor or any of its subsidiaries or any of their representatives, which will include a summary of the material terms and conditions of any Acquisition Proposal or Inquiry, including the identity of the person making such Acquisition Proposal or Inquiry (including copies of any written materials related thereto), (ii) keep CommerceHub reasonably informed of any material developments, discussions or negotiations regarding any Acquisition Proposal or Inquiry on a reasonably prompt basis (including copies of any written materials related thereto) and (iii) upon the reasonable request of CommerceHub, reasonably inform CommerceHub of the status of such Acquisition Proposal or Inquiry.

The Board of Directors’ Recommendation; ChannelAdvisor Adverse Change Recommendation

As described above, and subject to the provisions described below, the Board of Directors has made the recommendation that the holders of ChannelAdvisor common stock vote “FOR” adoption of the Merger Agreement. The Merger Agreement provides that the Board of Directors will not effect a Company Adverse Change Recommendation (as defined below) except as described below.

During the pre-Closing period, the Board of Directors (and any committee thereof) may not take any action described in the following (any such action, a “Company Adverse Change Recommendation”):

The Board of Directors also agreed not to approve, recommend or declare advisable, or propose to approve, recommend or declare advisable, or allow ChannelAdvisor to execute or enter into any Alternative Acquisition Agreements (other than an Acceptable Confidentiality Agreement).

Notwithstanding anything to the contrary in the Merger Agreement, if at any time prior to the receipt of the ChannelAdvisor Required Vote that did not arise out of a breach of the non-solicitation obligations in the Merger Agreement, ChannelAdvisor has received a written Acquisition Proposal from any person that has not been withdrawn, and the Board of Directors (or a committee thereof) has determined, in good faith, after consultation with its financial advisors and outside legal counsel, that such Acquisition Proposal is a Superior Proposal, (i) the Board of Directors (or a committee thereof) may make a Company Adverse Change Recommendation or (ii) ChannelAdvisor may terminate the Merger Agreement to enter into an agreement with respect to such Superior Proposal in accordance with the Merger Agreement:

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Issuance of any “stop, look and listen” communication by ChannelAdvisor pursuant to Rule 14d-9(f) which shall not, in and of itself, be considered a Company Adverse Change Recommendation and will not require a Determination Notice or compliance with the foregoing procedures, so long as such communication solely describes ChannelAdvisor’s receipt of an Acquisition Proposal and the operation of Merger Agreement with respect thereto; provided, if any such communication has the effect of withdrawing (or qualifying or modifying in a manner adverse to CommerceHub or Merger Sub) the Board of Directors’ recommendation, such communication will constitute a Company Adverse Change Recommendation.

Additionally, the Board of Directors (or a committee thereof) may make a Company Adverse Change Recommendation in response to a Change in Circumstances, if and only if:

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For the purposes of this proxy statement and the Merger Agreement, “Change in Circumstance” will mean any material Effect or material change in circumstances with respect to ChannelAdvisor and its subsidiaries that (a) was not known or reasonably foreseeable to the Board of Directors as of the date of the Merger Agreement (or if known by the Board of Directors as of the date of the Merger Agreement, the consequences of which were not known or reasonably foreseeable to Board of Directors as of the date of the Merger Agreement) and (b) does not relate to any Acquisition Proposal; provided, that none of the following, either alone or in combination, will constitute a “Change in Circumstance”: (i) any Acquisition Proposal, Inquiry or any business combination or acquisition opportunity, (ii) any Effect resulting from a breach of the Merger Agreement by ChannelAdvisor, (iii) the fact, in and of itself, that ChannelAdvisor and its subsidiaries exceed any internal or published projections, estimates or expectations of the their revenue, earnings or other financial or operating metrics for any period ending on or after the date of the Merger Agreement (provided that the exception in this clause (iii) will not prevent or otherwise affect consideration of any such development or change that causes ChannelAdvisor and its subsidiaries meeting or exceeding such metrics from being taken into account in determining whether a Change in Circumstance has occurred), or (iv) any changes after the date of the Merger Agreement in the market price or trading volume of the shares of ChannelAdvisor’s common stock (provided that the exception clause (iv) will not prevent or otherwise affect consideration of any such development or change that causes such change in market price or trading value from being taken into account in determining whether a Change in Circumstance has occurred).

Employee Benefits

The Merger Agreement provides that, for at least twelve months following the Effective Time (or, if earlier, until such time that such employee is no longer employed by CommerceHub or its affiliates), CommerceHub will provide, or will cause the Surviving Corporation to provide, to each ChannelAdvisor employee who is employed by ChannelAdvisor as of immediately prior to the Effective Time and who continues to be employed by the Surviving Corporation (or any affiliate thereof) during such period (each, a “Continuing Employee”) (i) base salary (or base wages, as the case may be), annual short-term cash incentive compensation (i.e., annual bonus target) opportunities (excluding equity compensation) and annual commission opportunities, each of which is no less favorable than the base salary (or base wages, as the case may be), target annual short-term cash incentive compensation and commission opportunities provided to such Continuing Employee immediately prior to the Effective Time (for the avoidance of doubt, other than one-time or special non-ordinary incentive compensation opportunities payable in connection with, or a result of, the Transactions), and (ii) and other employee benefits (including vacation but excluding severance, equity or equity-based compensation, long-term incentive, nonqualified deferred compensation benefits, defined benefit pension benefits or post-termination or retiree health or welfare benefits) that are substantially comparable in the aggregate to the employee benefits (including vacation but excluding severance, equity or equity-based compensation, long-term incentive, nonqualified deferred compensation benefits, defined benefit pension benefits and post-termination or retiree health or welfare benefits) provided to either, as determined by CommerceHub (x) such Continuing Employee immediately prior to the Effective Time or, (y) similarly situated employees of CommerceHub and the CommerceHub subsidiaries. From and after the Effective Time, CommerceHub will cause the Surviving Corporation and its subsidiaries to honor in accordance with their terms, all employee plans of ChannelAdvisor and its subsidiaries as in effect immediately prior to the Effective Time that are with any current or former employee, or individual who is an individual independent contractor, consultant or director, including ChannelAdvisor’s change in control severance arrangements; provided, that nothing herein will be deemed to prohibit CommerceHub, the Surviving Corporation or any of their subsidiaries from amending or terminating any such employee plan in accordance with its terms.

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Each Continuing Employee will be given service credit for purposes of eligibility to participate and benefit levels (including, without limitation, levels of benefits under CommerceHub’s and/or the Surviving Corporation’s vacation policy and severance plan), and benefit accrual under the Surviving Corporation’s vacation policy and severance plan and eligibility for vesting under CommerceHub and/or the Surviving Corporation’s employee benefit plans and arrangements for which such Continuing Employees are eligible following the Effective Time (each, a “CommerceHub Employee Benefit Arrangement”) with respect to his or her length of service with ChannelAdvisor (and its subsidiaries, affiliates and predecessors) prior to the Closing Date, to the same extent that such service was recognized under the comparable employee plans immediately prior to the Effective Time and to the extent permitted by the applicable CommerceHub Employee Benefit Arrangement, provided that such service need not be recognized (i) if it would result in the duplication of benefits; (ii) with respect to any qualified or non-qualified defined benefit plan, non-qualified deferred compensation, post-termination or retiree health or welfare benefits, or with respect to equity or equity based compensation only, for purposes of determining eligibility for vesting and benefit accruals; or (iii) to the extent such service was not credited under the corresponding employee plan prior to the Effective Time.

With respect to each CommerceHub Employee Benefit Arrangement that is a health or welfare benefit plan in which a Continuing Employee is eligible to participate on or after the Effective Time, CommerceHub will use commercially reasonable efforts to (i) waive, or cause to be waived, all limitations as to pre-existing conditions, exclusions, actively-at-work requirements and waiting periods with respect to participation and coverage requirements applicable to the Continuing Employees (and their eligible dependents), to the extent that such conditions, exclusions and waiting periods would not apply under a similar employee plan in which such employees participated prior to the Effective Time and (ii) ensure that such health or welfare benefit plan will, for purposes of deductibles, co-payments and out-of-pocket maximums and allowances, credit Continuing Employees (and their eligible dependents) under the applicable CommerceHub Employee Benefit Arrangement for amounts paid during the calendar year in which the Effective Time occurs for purposes of satisfying such year’s deductible, co-payment limitations and out-of-pocket maximums and allowances under the relevant welfare benefit plans in which such Continuing Employee (and their eligible dependents) will be eligible to participate in the year in which the Effective Time occurs.

Notwithstanding the foregoing, nothing in the Merger Agreement will confer upon any Continuing Employee any right to continue in the employ or service of CommerceHub or any affiliate thereof or any particular term or condition of employment for any person, or will interfere with or restrict in any way the rights of CommerceHub or any of its affiliate which rights are hereby expressly reserved, to discharge, reduce, or terminate the services of any Continuing Employee at any time for any reason whatsoever, with or without cause. Notwithstanding any provision in the Merger Agreement to the contrary, nothing in the Merger Agreement will (i) be deemed or construed to establish or be an amendment or other modification of any employee plan or employee benefit plan, program, policy, agreement, arrangement, or contract of CommerceHub or Merger Sub (ii) create any third party rights in any current or former service provider of any Company, its subsidiaries or their affiliates (or any beneficiaries or dependents thereof), or (iii) prohibit or limit the ability of the CommerceHub or any of its affiliates (including, following the Effective Time, the Surviving Corporation or its subsidiaries) to amend, modify or terminate any benefit or compensation plan, program, policy, agreement, arrangement, or contract at any time assumed, established sponsored or maintained by any of them.

Efforts to Close the Merger

Under the Merger Agreement, CommerceHub and ChannelAdvisor agreed to use reasonable best efforts to consummate the Merger and make effective the Transactions as soon as reasonably practicable.

Cooperation with the Financing

The obligation of CommerceHub and Merger Sub to consummate the Merger is not subject to any financing condition under the Merger Agreement, and CommerceHub and Merger Sub are obligated to consummate the Transactions irrespective and independently of the availability of the equity financing, and Debt Financing or any alternative financing, subject to the fulfilment or waiver of the closing conditions.

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Under the Merger Agreement, CommerceHub or Merger Sub, as applicable, agreed to use its reasonable best efforts to take or do, or cause to be taken or done, all things necessary, proper or advisable to arrange and obtain the financing on the terms and subject to the conditions set forth in the Commitment Letters, including to:

CommerceHub is also required to (A) provide ChannelAdvisor with prompt notice (and keep ChannelAdvisor informed on a current basis in reasonable detail with respect to) any material breach or default (or any event or circumstance that, with or without notice, lapse of time or both, could reasonably be excepted to give rise to any material breach or default) by any party to any Commitment Letter or definitive document to be entered into in order to procure the financing of which CommerceHub becomes aware or if at any time for any other reason CommerceHub reasonably believes that it will not be able to obtain all or any portion of the financing contemplated by the Commitment Letter in an amount sufficient to fund the required amount of funding under the Merger Agreement, and (B) give ChannelAdvisor prompt notice of (and keep ChannelAdvisor informed on a current basis in reasonable detail with respect to) the receipt of any written notice or, to the knowledge of CommerceHub, other written communication from any person with respect to (1) any actual or threatened breach, default, termination or repudiation of the Commitment Letters or any definitive documents to be entered into in order to procure the financing by any party thereto, (2) material dispute or disagreement between or among CommerceHub and any parties to the Commitment Letters or any definitive documents to be entered into in order to procure the financings and (3) the occurrence of an event or development that could reasonably be expected to adversely impact the ability of CommerceHub to obtain all or any portion of the financing in an amount sufficient to pay the required amount for of funding under the Merger Agreement; provided, that neither CommerceHub nor any of its affiliates will be under any obligation to disclose any information pursuant to this sentence to the extent that, in its reasonable discretion, (x) such information is subject to attorney-client, work product doctrine or other privilege asserted in good faith or (y) the disclosure of which would be prohibited or restricted by applicable law.

Under the Merger Agreement and prior to Closing, ChannelAdvisor agreed to use reasonable best efforts and will cause each of its subsidiaries to use its respective reasonable best efforts, at CommerceHub’s sole expense, to provide CommerceHub with all customary cooperation (and will use its reasonable best efforts to cause its representatives to cooperate) as is reasonably requested by CommerceHub to arrange and obtain the Debt Financing to be obtained by CommerceHub or its affiliates in connection with the Transactions, including using reasonable best efforts in:

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Furthermore, neither ChannelAdvisor nor any of its subsidiaries will be required to (i) take any action that would subject it to liability that is not contingent upon Closing or subject any director, manager, officer or employee of ChannelAdvisor or any of its affiliates to any actual or potential personal liability, (ii) waive or amend any terms of the Merger Agreement or agree to pay any fees or reimburse any expenses in connection with the Debt Financing prior to the Effective Time that is not advanced by CommerceHub; (iii) enter into any definitive agreement the effectiveness of which is not conditioned upon the Closing; (iv) give or agree to give any indemnities prior to the Effective Time; or (v) take any action that would reasonably be expected to contravene applicable law including antitrust law or that would interfere with the conduct of the business or ChannelAdvisor and its subsidiaries, breach any confidentiality obligations applicable to ChannelAdvisor and its subsidiaries or create a reasonable risk of damage or destruction to any property or assets of ChannelAdvisor or any of its subsidiaries.

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In accordance with the Merger Agreement, CommerceHub and Merger Sub will indemnify and hold harmless ChannelAdvisor and its subsidiaries and their respective representatives from and against any and all liabilities, losses, damages, claims, costs, expenses (including reasonable and out-of-pocket attorneys’ fees), interest, awards, judgments, penalties and amounts paid in settlement suffered or incurred by them in connection with arranging the Debt Financing or the provision of information utilized in connection therewith (except to the extent that any of the foregoing arises from the gross negligence, fraud or willful breach of ChannelAdvisor, its subsidiaries and their respective representatives obligations under the Merger Agreement).

If any portion of the Debt Financing becomes unavailable and such amount is required to fund the required amounts (taking into account any then available debt and equity financing), CommerceHub will promptly notify ChannelAdvisor in writing and each of CommerceHub and Merger Sub will use its reasonable best efforts to arrange and timely obtain substitute financing from the same or alternative sources in an amount sufficient to fund the required amount of funding under the Merger Agreement, as promptly as practicable following the occurrence of such event but no later than the Closing Date, and will promptly after the execution and delivery thereof, provide to ChannelAdvisor a true and complete copy of the Debt Commitment Letter and fee letter related to the alternate financing with redactions consistent with the redactions made to the fee letter delivered on the date hereof.

Director and Officer Indemnification and Insurance

The Merger Agreement provides that, to fullest extent permitted by applicable legal requirements, all existing rights to indemnification, advancement of expenses and exculpation, by ChannelAdvisor or any of its subsidiaries existing in favor of those persons who are directors and officers of ChannelAdvisor or any of its subsidiaries as of the date of the Merger Agreement or have been directors or officers of ChannelAdvisor or any of its subsidiaries in the past (the “Indemnified Persons”) for their acts and omissions occurring prior to the Effective Time (whether asserted or claimed prior to, at or after the Effective Time), as provided in the certificate of incorporation, bylaws, or applicable governing documents of ChannelAdvisor or its subsidiaries and as provided in the indemnification agreements between ChannelAdvisor and its subsidiaries and each Indemnified Person as of the date of the Merger Agreement, will (i) survive Closing and to the fullest extent permitted under applicable legal requirements, (ii) not be amended, repealed or otherwise modified in any manner that would adversely affect the rights of the Indemnified Persons, and (iii) will be observed by the Surviving Corporation and its subsidiaries to the fullest extent available under applicable legal requirements for a period of six years from the Effective Time.

The Merger Agreement also provides that, during the period commencing on the Effective Time and until the sixth anniversary of the date on which the Effective Time occurs, CommerceHub and the Surviving Corporation will (i) indemnify, defend, hold harmless and advance expenses to the Indemnified Persons with respect to all facts, events, acts or omissions by them in their capacities as such at any time prior to and including the Effective Time (including any matters arising in connection with Merger Agreement or the Transactions), to the fullest extent that ChannelAdvisor and its subsidiaries would be permitted by applicable legal requirement; and (ii) pay in advance of the final disposition of any action against any Indemnified Persons the expenses (including reasonable attorneys’ fees) of any Indemnified Persons upon receipt, if required by the DGCL, the Surviving Corporation’s organizational documents or any applicable indemnification agreement, of a written undertaking by him or her or on his or her behalf to repay the amount paid or reimbursed if it is ultimately determined that such Indemnified Persons is not permitted to be indemnified under applicable legal requirements.

Additionally, from the Effective Time until the sixth anniversary of the Effective Time, the Surviving Corporation will, and CommerceHub will cause the Surviving Corporation to, maintain in effect the existing policy of directors’ and officers’ liability insurance and fiduciary liability insurance maintained by ChannelAdvisor and its subsidiaries as of the date of the Merger Agreement for the benefit of the Indemnified Persons who are currently covered by such existing policy with respect to their acts and omissions occurring prior to the Effective Time in their capacities as directors and officers of ChannelAdvisor and its subsidiaries (as applicable) on terms with respect to coverage, deductibles and amounts no less favorable than the existing policy. At CommerceHub or ChannelAdvisor’s election prior to the Effective Time, CommerceHub or ChannelAdvisor may (through a nationally recognized insurance broker) purchase a six-year “tail” policy for the existing policy effective as of the Effective Time and if such “tail policy” has been obtained, it will be deemed to satisfy all obligations to obtain and/or maintain insurance pursuant to the Merger Agreement. In no event, however, will the Surviving Corporation be required to expend in any one year an amount in excess of 275% of the annual premium currently payable by ChannelAdvisor and its subsidiaries as of the date of the Merger Agreement with respect to such existing policy, and if the annual premiums payable for such insurance coverage exceeds such amount, CommerceHub will cause the Surviving Corporation to obtain a policy with the greatest coverage available for a cost equal to such amount.

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Other Covenants

Special Meeting

ChannelAdvisor has agreed to take all actions necessary and advisable under applicable legal requirements, its certificate of incorporation and bylaws and the rules of NYSE to duly call, give notice of, convene and hold the Company Stockholders Meeting as promptly as reasonably practicable after the date on which the mailing of this proxy statement to ChannelAdvisor stockholders is complete (and in any event no later than thirty calendar days after the date of such completed mailing) for the purpose of voting upon the adoption of the Merger Agreement.

Stockholder Litigation

ChannelAdvisor has agreed to promptly notify CommerceHub of any litigation against ChannelAdvisor or its directors relating to the Transactions and to keep CommerceHub informed on a reasonably current basis with respect thereto. ChannelAdvisor has also agreed to give CommerceHub the right to review and comment on all filings or responses to be made by ChannelAdvisor in connection with such litigation, and the right to consult on any proposed settlement with respect to such litigation, and ChannelAdvisor will in good faith take such comments into account. ChannelAdvisor may not enter into a settlement without CommerceHub’s prior written consent (such consent not to be unreasonably withheld, conditioned or delayed).

Loan Payoff

Prior to the Closing, ChannelAdvisor must satisfy all notification requirements under the terms of any agreements with debtors of ChannelAdvisor and obtain payoff letters, in form and substance reasonably satisfactory to CommerceHub, from all lenders or other applicable third persons with respect to any indebtedness disclosed in the ChannelAdvisor disclosure letter. CommerceHub will pay the funds required substantially concurrently with the Closing to effect the repayment of the ChannelAdvisor credit agreement.

Conditions to the Closing of the Merger

The obligations of ChannelAdvisor, CommerceHub and Merger Sub to consummate the Merger are subject to the satisfaction or waiver (where permissible pursuant to applicable legal requirements) of each of the following conditions:

The obligations of CommerceHub and Merger Sub to consummate the Merger are subject to the satisfaction (or waiver if permissible pursuant to applicable legal requirements, by CommerceHub and Merger Sub) of each of the following conditions (“ChannelAdvisor Closing Conditions”):

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