Item 8.01 Other Events.
On October 1, 2021, the Company completed its previously announced acquisition of Clarabridge pursuant to the terms of the Merger Agreement. The acquisition was accomplished by the merger of Merger Sub with and into Clarabridge (the “Merger”), and upon consummation of the Merger, Merger Sub ceased to exist and Clarabridge became a wholly-owned subsidiary of the Company.
Pursuant to the terms of the Merger Agreement, at the closing of the Merger (the “Closing”), all shares of Clarabridge capital stock issued and outstanding immediately before the effective time of the Merger were cancelled in exchange for aggregate consideration of $1.125 billion, subject to certain adjustments, in the form of shares of Company Stock (the “Stock Consideration”); provided, that shares of Clarabridge capital stock held by unaccredited Clarabridge stockholders were cancelled in exchange for the right to receive cash in lieu of the Stock Consideration. The number of shares to be issued in connection with the Stock Consideration was calculated based on a fixed value of $37.33 per share, which is the average of the daily volume-weighted average sales price per share of Company Stock on the Nasdaq Select Market during the ten consecutive trading days ending three trading days immediately preceding the date of the Merger Agreement.
The Company will issue the Stock Consideration in reliance upon the exemptions from registration afforded by Section 4(a)(2) and/or Rule 506 promulgated under the Securities Act of 1933, as amended.
A portion of the aggregate consideration is being held back by the Company to secure the indemnification obligations of the Clarabridge securityholders and certain post-Closing adjustments for the amount of indebtedness of, the working capital of, the unpaid transaction expenses incurred by and the amount of cash held by Clarabridge and its subsidiaries.
In addition, pursuant to the terms of the Merger Agreement, (i) the Clarabridge Stock Plans have been assumed, amended and restated by the Company, (ii) the Clarabridge Options have been assumed by the Company and converted into corresponding Company Options to purchase, in the aggregate, 3,203,885 shares of Class A Common Stock, and (iii) the Company will grant equity incentive awards to certain continuing employees of Clarabridge and its subsidiaries under the 2021 Qualtrics International Inc. Inducement Equity Plan at the Company’s sole discretion.
The Company issued a press release on October 1, 2021, announcing the Closing, and such press release is filed herewith as Exhibit 99.1 and incorporated by reference herein.
Forward-Looking Statements
This Current Report on Form 8-K contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements concerning the anticipated benefits and timing of the proposed transaction between the Company and Clarabridge and the product and markets of each company. In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “project,” “will,” “would,” “should,” “could,” “can,” “predict,” “potential,” “target,” “explore,” “continue,” or the negative of these terms, and similar expressions intended to identify forward-looking statements. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to numerous uncertainties and risks, including factors beyond our control, that could cause actual results, performance or outcomes to differ materially from those anticipated or implied in the statements. Additional risks and uncertainties that
could cause actual results, performance or outcomes to differ materially from those contemplated by the forward-looking statements are and/or will be included under the caption “Risk Factors” and elsewhere in the Company’s Annual Report on Form 10-K and most recent Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission and any subsequent public filings. Forward-looking statements speak only as of the date the statements are made. Readers are cautioned not to put undue reliance on forward-looking statements, and the Company assumes no obligation to update forward-looking statements, whether to reflect new information, events or circumstances after the date they were made or otherwise, except as required by law.