Introductory Note
As previously disclosed in our Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on August 6, 2021, Cornerstone OnDemand, Inc., a Delaware corporation (the “Company” or “Cornerstone”), entered into an Agreement and Plan of Merger, dated as of August 5, 2021 (the “Merger Agreement”), with Sunshine Software Holdings, Inc., a Delaware corporation (“Parent”), and Sunshine Software Merger Sub, Inc., a Delaware corporation and an indirect wholly owned subsidiary of Parent (“Merger Sub”). Parent is owned by funds managed by affiliates of Clearlake Capital Group, L.P.
On October 15, 2021, the Company completed its merger with Merger Sub pursuant to the terms of the Merger Agreement, whereby Merger Sub merged with and into the Company, in accordance with the Delaware General Corporation Law (the “DGCL”), with the Company continuing as the surviving corporation (the “Surviving Corporation”) and as an indirect wholly owned subsidiary of Parent (the “Merger”).
Pursuant to the Merger Agreement, at the effective time of the Merger (the “Effective Time”), each:
(i) share of Company common stock, par value $0.0001 per share (the “Company Shares”), issued and outstanding as of immediately prior to the Effective Time (except for Company Shares (A) held by the Company (or held in the Company’s treasury); (B) owned by Parent or Merger Sub or any other direct or indirect subsidiary of Parent; and (C) any dissenting shares) was cancelled and converted into the right to receive cash in an amount equal to $57.50, without interest (the “Per Share Merger Consideration”), subject to any required withholding of taxes;
(ii) (A) restricted stock unit award granted pursuant to the Company’s equity incentive plans or otherwise (each, a “Company RSU”) that was unexpired, unexercised, outstanding and vested as of immediately prior to the Effective Time or that vested solely as a result of the consummation of the Merger (each, a “Vested Company RSU”), (B) options to purchase Company Shares granted pursuant to the Company’s equity incentive plans or otherwise (each, a “Company Option”) that was unexpired, unexercised, outstanding and vested as of immediately prior to the Effective Time or that vested solely as a result of the consummation of the Merger (each, a “Vested Company Option”), and (C) Company RSU owned by a non-employee member of the Company’s board of directors (each, a “Director RSU”), was cancelled and converted into the right to receive cash in an amount equal to the product of (y) the aggregate number of shares subject to, or issuable in settlement of, such award immediately prior to the Effective Time, multiplied by (z) the Per Share Merger Consideration (or, for each Vested Company Option, the excess, if any, of the Per Share Merger Consideration over such Company Option’s per share exercise price), subject to any required withholding of taxes; and
(iii) (A) Company RSU that is not a Director RSU or Vested Company RSU (each, an “Unvested Company RSU”) and (B) portion of a Company Option that is not a Vested Company Option (each, an “Unvested Company Option” and, together with each Unvested Company RSU, an “Unvested Award”), was cancelled and converted into the right to receive an amount in cash, without interest, equal to the product of (y) the aggregate number of shares subject to such Unvested Award immediately prior to the Effective Time, multiplied by (z) the Per Share Merger Consideration (or, for each Unvested Company Option, the excess, if any, of the Per Share Merger Consideration over such Unvested Company Option’s per share exercise price), subject to any required withholding of taxes (the “Unvested Consideration Amount”), which Unvested Consideration Amount will be paid at the same time(s) that the Unvested Awards would have vested in accordance with their terms and will remain subject to the holder of the Unvested Awards remaining in continuous service with Parent, the Surviving Corporation or any of its Subsidiaries (as defined in the Merger Agreement) through each such vesting date (except, that any terms and conditions relating to accelerated vesting upon a termination of the holder’s employment in connection with or following the Merger will continue to apply to the Unvested Consideration Amount). Any Company Options (whether vested or unvested) with a per share exercise price equal to or greater than the Per Share Merger Consideration were cancelled immediately upon the Effective Time without payment or consideration.