If you hold a stock in a buyout situation until the deal closes you will receive the buyout price. It has been a long time since I held a stock until the buyout so I don't remember for sure if you have to fill out some paperwork with the broker. I'm thinking you don't but I could be wrong. Also, it does depend upon the deal because sometimes (not with ITSI) there are options on the merger consideration you receive (e.g. stock in the acquirer, cash, or a combination). When there are options you have to fill out paperwork unless you want the default option.
The reason that the stock doesn't sell at the stock price is that there is always a risk that the deal doesn't close. It is pretty rare that a deal doesn't close but it does happen. There are people known as arbs that will analyze the deal and buy the stock. They are willing to buy the stock for a slight discount to take on the risk that the deal doesn't close and to provide some interest for them while they wait. The amount of the discount indicates the risk level and the amount of time/interest until the deal closes.
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