SEC Form SC 13D filed by Zuora Inc.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

ZUORA, INC.

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(Name of Issuer)

Class A Common Stock, par value $0.0001 per share

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(Title of Class of Securities)

98983V106

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(CUSIP Number)

Tien Tzuo

c/o Zuora, Inc.

101 Redwood Shores Parkway

Redwood City, California 94065

With copies to:

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(Name, Address and Telephone Number of Person Authorized to

Receive Notices and Communications)

October 17, 2024

(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. ☐

*The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

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The Reporting Person (as defined below) previously filed a Schedule 13G pursuant to Rule 13d-1(d) on February 13, 2019 (as amended by Amendment No. 1 to Schedule 13G filed on February 10, 2020, Amendment No. 2 to Schedule 13G filed on February 16, 2021, Amendment No. 4 to Schedule 13G filed on February 10, 2022, Amendment No. 5 to Schedule 13G filed on February 13, 2023 and Amendment No. 6 to Schedule 13G filed on February 8, 2024) to report its beneficial ownership of shares of Common Stock (as defined below) of the Issuer (as defined below).  As a result of the transaction on October 17, 2024 described below, the Reporting Person is no longer eligible to file Schedule 13G pursuant to Rile 13d-1(d).  Accordingly, the Reporting Person is filing this statement on Schedule 13D pursuant to Section 13(d) of the Act.

Item 1.

Security and Issuer

Item 2.

Identity and Background

Item 3.

Source and Amount of Funds or Other Consideration

 

The information contained in rows 7, 8, 9, 10, 11 and 13 on each of the cover pages of this Schedule 13D and the information set forth or incorporated in Items 2 and 6 of this Schedule 13D is incorporated by reference in its entirety into this Item 3.

Item 4.

Purpose of Transaction

 

Merger Agreement

 

On October 17, 2024, the Issuer entered into an Agreement and Plan of Merger (the “Merger Agreement”) by and among the Issuer, Zodiac Purchaser, L.L.C., a Delaware limited liability company (“Parent”), and Zodiac Acquisition Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Parent (“Merger Sub”). Parent and Merger Sub are indirectly controlled by private investment funds affiliated with Silver Lake Group, L.L.C.

The Merger Agreement provides that, among other things and on the terms and subject to the conditions of the Merger Agreement, at the effective time of the Merger (the “Effective Time”), (a) Merger Sub will merge with and into the Issuer (the “Merger” and, together with the other transactions contemplated by the Merger Agreement, collectively the “Transactions”), with the Issuer surviving the Merger as a wholly owned subsidiary of Parent (the “Surviving Corporation”), (b) each issued and outstanding share of Common Stock as of immediately prior to the effective time of the Merger (the “Effective Time”) will, at the Effective Time, be converted into the right to receive $10.00 in cash without interest (the “Merger Consideration”), (c) each share of Common Stock held in the treasury of the Issuer, each Rollover Share (as defined below) and any shares of Common Stock owned by Parent or Merger Sub immediately prior to the Effective Time will automatically be canceled and will cease to exist and no consideration will be delivered in exchange therefor and (d) each share of common stock of Merger Sub issued and outstanding immediately prior to the Effective Time will automatically be converted into and become one fully paid, nonassessable share of common stock, par value $0.00001 per share, of the Surviving Corporation with the same rights, powers and privileges as the shares so converted and will constitute the only outstanding shares of capital stock of the Surviving Corporation.

 

The foregoing summary of the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Merger Agreement, a copy of which is filed as an exhibit to this Schedule 13D and incorporated herein by reference. The representations, warranties and covenants contained in the Merger Agreement have been made solely for the purposes of the Merger Agreement and as of specific dates; were made solely for the benefit of the parties to the Merger Agreement; are not intended as statements of fact, but rather as a way of allocating the risk between the parties in the event the statements therein prove to be inaccurate; have been modified or qualified by certain confidential disclosures that were made between the parties in connection with the negotiation of the Merger Agreement, which disclosures are not reflected in the Merger Agreement itself; may no longer be true as of a given date; and may apply standards of materiality in a way that is different from what may be viewed as material by the stockholders or other security holders of the Issuer.

 

Support and Rollover Agreement

 

Concurrently with the execution of the Merger Agreement, the Reporting Person and certain of his affiliates that hold shares of Common Stock (collectively, the “Supporting Stockholders”) entered into a certain voting, support and rollover agreement (the “Support and Rollover Agreement”) with the Issuer and Parent, pursuant to which each of the Supporting Stockholders agreed that, until the earlier of the Effective Time and the termination of the Merger Agreement, (a) it will not transfer the shares of Common Stock owned of record or beneficially by it as of the date of the Merger Agreement (the “Covered Shares”) subject to certain exceptions, and (b) it will vote all of its Covered Shares (i) in favor of the approval and adoption of the Merger Agreement and the transactions contemplated by the Merger Agreement, (ii) in favor of the approval of any proposal to adjourn or postpone the meeting to a later date if there are not sufficient votes present for there to be a quorum or for the approval and adoption of the Merger Agreement on the date on which such meeting is held, (iii) against any action, proposal, transaction or agreement that would reasonably be expected to result in any condition set forth in the Merger Agreement not being satisfied prior to the termination of the Merger Agreement or a breach of any covenant, representation or warranty thereof, or any other obligation or agreement of it under the Support Agreement, (iv) against any acquisition proposal, including any superior proposal, (v) any action, proposal, transaction or agreement that would change in any manner the voting rights of any shares of the Issuer. The Supporting Stockholders also agreed to waive all appraisal rights under Section 262 of the DGCL with respect to the Covered Shares and not to commence or participate in (A) any class actions with respect to Parent, Merger Sub or the Issuer, or (B) certain other legal actions against Parent, Merger Sub or the Issuer in connection with the Transactions.

 

In addition, pursuant to the Support and Rollover Agreement, immediately prior to the Effective Time, the Supporting Stockholders will contribute to a direct or indirect parent company of Parent shares of Common Stock (the “Rollover Shares”) with an aggregate value (based on the Merger Consideration) of $70,000,000 (“Aggregate Rolled Value”) in exchange for equity interests in a direct or indirect parent company of Parent (the “CEO Rollover”). On or before October 31, 2024, the Supporting Stockholders may elect to increase (with the consent of Parent in its discretion) the Aggregate Rolled Value by up to an additional $30,000,000. As a result of the Merger, the Rollover Shares contributed to such parent company of Parent by the Supporting Stockholders will be cancelled and extinguished without any conversion thereof or consideration paid therefor.

As a result of the execution and delivery of the Support and Rollover Agreement by the parties thereto, the Reporting Person may be deemed to have formed a “group” within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) with SLA Zurich Holdings, L.P. (“SLA Zurich Holdings”), SLA Zurich Aggregator, L.P. (“SLA Zurich Aggregator”), SLA Zurich GP, L.L.C. (“SLA Zurich GP”), SL Alpine II Aggregator GP, L.L.C. (“SLA Aggregator”), Silver Lake Alpine Associates II, L.P. (“SLAA”), SLAA II (GP), L.L.C. (“SLAA GP”) and Silver Lake Group, L.L.C. (“SLG” and, together with SLA Zurich Holdings, SLA Zurich Aggregator, SLA Zurich GP, SLA Aggregator, SLAA and SLAA GP, “Silver Lake”). The beneficial ownership of the Reporting Person as reported in this filing does not include any shares of Class A Common Stock which may be beneficially owned by Silver Lake and the Reporting Person disclaims beneficial ownership over any such shares. This filing should not be deemed an admission that the Reporting Person is a member of a “group” within the meaning of Section 13(d) of the Exchange Act with any Silver Lake entity or has beneficial ownership of any equity securities of the Issuer held by any Silver Lake entity.

 

The foregoing summary of the Support and Rollover Agreement does not purport to be complete and is qualified in its entirety by reference to the Support and Rollover Agreement, a copy of which is filed as an exhibit to this Schedule 13D and incorporated herein by reference.

 

The information contained in rows 7, 8, 9, 10, 11 and 13 on the cover page of this Schedule 13D and the information set forth or incorporated in Items 2, 3 and 6 of this Schedule 13D is incorporated by reference in its entirety into this Item 5.

 

(a) – (b) As a result of the execution and delivery of the Support and Rollover Agreement by the Supporting Stockholders, the Reporting Person may be deemed to have formed a “group” within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) with Silver Lake.  Based on information provided by Silver Lake to the Reporting Person, as of the date hereof, Silver Lake may be deemed to beneficially own an aggregate of 27,500,000 shares of Class A Common Stock, representing approximately 15.9% of the outstanding shares of Class A Common Stock (assuming (i) the conversion by Silver Lake of $400,000,000 in aggregate principal amount of certain convertible notes issued by the Issuer to SLA Zurich Holdings into 20,000,000 shares of Class A Common Stock based on the current conversion rate set forth in the convertible notes, and (ii) the exercise of certain warrants issued by the Issuer to SLA Zurich Aggregator into 7,500,000 shares of Class A Common Stock, and based on approximately 145,070,528 shares of Class A Common Stock outstanding as of October 16, 2024 based on information provided by the Issuer).  The beneficial ownership of the Reporting Person does not include any shares of Class A Common Stock which may be beneficially owned by Silver Lake and the Reporting Person disclaims beneficial ownership over any such shares.

Item 6.

Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer

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