Case 1:23-cv-00595 Document 1 Filed 01/24/23 Page 1 of 12
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`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF NEW YORK
`
`
`MATTHEW HAMILTON,
`
`Plaintiff,
`
`v.
`
`
`COUPA SOFTWARE INCORPORATED,
`ROBERT BERNSHTEYN, MICHELLE
`BRENNAN, KANIKA SONI, ROGER SIBONI,
`TAYLOE STANSBURY, SCOTT THOMPSON,
`and FRANK VAN VEENENDAAL,
`
`
`Defendants.
`
`
`
`
`Case No. _____________
`
`
`COMPLAINT FOR VIOLATIONS
`OF THE FEDERAL SECURITIES
`LAWS
`
`
`
`JURY TRIAL DEMANDED
`
`
`
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`Plaintiff Matthew Hamilton (“Plaintiff”), by and through his undersigned counsel, for his
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`complaint against defendants, alleges upon personal knowledge with respect to himself, and upon
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`information and belief based upon, inter alia, the investigation of counsel as to all other allegations
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`herein, as follows:
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`NATURE AND SUMMARY OF THE ACTION
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`This is a stockholder action brought by Plaintiff against Coupa Software
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`1.
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`Incorporated (“Coupa” or the “Company”) and the members of Coupa’s Board of Directors (the
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`“Board” or the “Individual Defendants”) for their violations of Sections 14(a) and 20(a) of the
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`Securities Exchange Act of 1934 (the “Exchange Act”), 15 U.S.C. §§ 78n(a), 78t(a), and U.S.
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`Securities and Exchange Commission (“SEC”) Rule 14a-9, 17 C.F.R. §240.14a-9 (“Rule 14a-9”),
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`in connection with the Board’s attempt to sell Coupa to affiliates of Thoma Bravo, L.P. (“Thoma
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`Bravo”) (the “Proposed Transaction”).
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`Case 1:23-cv-00595 Document 1 Filed 01/24/23 Page 2 of 12
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`2.
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`On December 11, 2022, Coupa entered into an Agreement and Plan of Merger with
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`Coupa Holdings, LLC (f/k/a Project CS Parent, LLC) (“Parent”) and its wholly owned subsidiary,
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`Project CS Merger Sub, Inc. (“Merger Sub”) (the “Merger Agreement”). Parent and Merger Sub
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`are each affiliated with Thoma Bravo Fund XV, L.P. (the “Thoma Bravo Fund”), and Parent,
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`Merger Sub and the Thoma Bravo Fund are each affiliated with Thoma Bravo. Pursuant to the
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`terms of the Merger Agreement, Thoma Bravo will acquire Coupa for $81.00 in cash for each
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`Coupa common share.
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`3.
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`On January 23, 2023, the Board authorized the filing of the materially incomplete
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`and misleading Schedule 14A Definitive Proxy Statement (the “Proxy Statement”) with the SEC.
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`Specifically, the Proxy Statement, which recommends that Coupa stockholders vote their shares
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`in favor of the Proposed Transaction, contains materially incomplete and misleading information
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`concerning, among other things: (i) the Company’s financial projections; (ii) the financial
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`analyses that support the fairness opinion provided by the Company’s financial advisor, Qatalyst
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`Partners LP (“Qatalyst”); and (iii) potential conflicts of interest faced by Company insiders.
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`4.
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`The failure to adequately disclose such material information constitutes a violation
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`of Sections 14(a) and 20(a) of the Exchange Act as Coupa stockholders need such information in
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`order to make a fully informed decision in connection with the Proposed Transaction.
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`5.
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`The special meeting for Coupa stockholders to vote on the Proposed Transaction is
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`currently scheduled for February 23, 2023. It is imperative that such Exchange Act violations are
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`promptly cured to enable Plaintiff and Coupa’s other shareholders to make an informed decision
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`whether to vote their shares in favor of the Proposed Transaction. Therefore, Plaintiff seeks to
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`enjoin the stockholder vote unless and until such Exchange Act violations are cured.
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`Case 1:23-cv-00595 Document 1 Filed 01/24/23 Page 3 of 12
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`JURISDICTION AND VENUE
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`6.
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`This Court has jurisdiction over the claims asserted herein for violations of Sections
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`14(a) and 20(a) of the Exchange Act and SEC Rule 14a-9 promulgated thereunder pursuant to
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`Section 27 of the Exchange Act, 15 U.S.C. § 78aa, and 28 U.S.C. § 1331 (federal question
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`jurisdiction).
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`7.
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`Personal jurisdiction exists over the defendants because each defendant either
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`conducts business in or maintains operations within this District, or is an individual with sufficient
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`minimum contacts with this District so as to make the exercise of jurisdiction by this Court
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`permissible under traditional notions of fair play and substantial justice.
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`8.
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`Venue is proper in this District pursuant to 28 U.S.C. § 1391 because defendants
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`are found or are inhabitants or transact business in this District. Coupa’s common stock trades on
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`the Nasdaq Global Select Market, which is headquartered in this District, rendering venue in this
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`District appropriate.
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`THE PARTIES
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`9.
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`Plaintiff is, and has been at all relevant times, the owner of shares of Coupa
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`common stock.
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`10.
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`Defendant Coupa is a Delaware corporation, with its principal executive offices
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`located at 1855 S. Grant Street, San Mateo, California 94402. Coupa’s shares trade on the Nasdaq
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`Global Select Market under the ticker symbol “COUP.”
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`11.
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`Defendant Robert Bernshteyn has been Chairman of the Board and Chief Executive
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`Officer and a director of the Company at all relevant times.
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`12.
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`Defendant Michelle Brennan has been a director of the Company at all relevant
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`times.
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`13.
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`14.
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`Defendant Kanika Soni has been a director of the Company at all relevant times.
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`Defendant Roger Siboni has been the Lead Independent Director of the Company
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`at all relevant times.
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`15.
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`Defendant Tayloe Stansbury has been a director of the Company at all relevant
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`times.
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`times.
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`times.
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`16.
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`Defendant Scott Thompson has been a director of the Company at all relevant
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`17.
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`Defendant Frank van Veenendaal has been a director of the Company at all relevant
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`18.
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`Defendants identified in paragraphs 11-17 are collectively referred to herein as the
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`“Board” or the “Individual Defendants.”
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`SUBSTANTIVE ALLEGATIONS
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`Background of the Company
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`19.
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`Founded in 2006, Coupa is a provider of business spend management solutions,
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`with its cloud-based platform that connects its customers with suppliers worldwide. Coupa
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`provides visibility into and control over how companies spend money, optimize supply chains, and
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`manage liquidity, as well as enables businesses to achieve savings that drive profitability. The
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`Company’s platform offers procurement, invoicing, expense management, and payment solutions
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`that form the transactional engine for managing a company’s business spend, as well as specialized
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`solutions, including strategic sourcing, contract management, contingent workforce, supplier risk
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`management, supply chain design and planning, treasury management, and spend analysis. It
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`serves businesses in various industries, including healthcare and pharmaceuticals, retail, financial
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`services, manufacturing, and technology.
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`The Proposed Transaction
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`20.
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`On December 12, 2022, Coupa announced that it had entered into the Proposed
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`Transaction, stating, in relevant part:
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`SAN MATEO, Calif., Dec. 12, 2022 /PRNewswire/ -- Coupa Software (NASDAQ:
`COUP), a leader in Business Spend Management (BSM), today announced that it
`has entered into a definitive agreement to be acquired by Thoma Bravo, a leading
`software investment firm. This is an all-cash transaction with an enterprise value of
`$8.0 billion. Upon completion of the transaction, Coupa will become a privately
`held company.
`
`The transaction includes a significant minority investment from a wholly owned
`subsidiary of the Abu Dhabi Investment Authority (ADIA). Under the terms of the
`agreement, Coupa shareholders will receive $81.00 per share in cash, which
`represents a 77% premium to Coupa’s closing stock price on November 22, 2022,
`the last full trading day prior to media reports regarding a possible sale transaction
`involving the company. The transaction consideration also represents a premium of
`approximately 64% to the volume weighted average closing price of Coupa stock
`for the 30 trading days ending on November 22, 2022.
`
`“For more than a decade, we’ve been building an incredible Business Spend
`Management Community and have proudly cemented our position as the market-
`leading platform in our category. We’re looking forward to partnering with Thoma
`Bravo and accelerating our vision to digitally transform the Office of the CFO,”
`said Rob Bernshteyn, chairman and chief executive officer at Coupa. “While our
`ownership may change, our values do not. Every one of us at Coupa will continue
`to put our customers at the center of everything we do and help them maximize the
`value of every dollar they spend.”
`
`“This transaction is the result of a deliberate and thoughtful process that included
`engagement with both strategic and financial parties,” said Roger Siboni, Coupa’s
`lead independent director. “The Board evaluated the transaction against the
`company’s standalone prospects in the current macroeconomic climate and
`determined that the compelling and certain cash consideration in the transaction
`provides superior risk-adjusted value relative to the Company’s standalone
`prospects. The Board is unanimous in its belief this transaction is the optimal path
`forward and in the best interest of our shareholders.”
`
`“Coupa has created and led the large and growing Business Spend Management
`category. We’ve followed the company’s success for many years and have been
`impressed by its consistent track record of delivering high levels of value for its
`global customer base,” said Holden Spaht, a Managing Partner at Thoma Bravo.
`“We look forward to partnering with Rob and the rest of the management team to
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`Case 1:23-cv-00595 Document 1 Filed 01/24/23 Page 6 of 12
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`keep investing in the company’s product strategy while driving growth both
`organically and through M&A.”
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`“We couldn’t be more excited to partner with the talented Coupa team to keep
`building on the incredible franchise they’ve created in the Business Spend
`Management space,” said Brian Jaffee, a Partner at Thoma Bravo. “Our shared
`vision, combined with Thoma Bravo’s strategic and operational expertise, will
`enable Coupa to continue driving innovation, better serve its customers and
`accelerate important growth initiatives during this next chapter as a private
`company.”
`
`Approvals and Timing
`
`The transaction, which was approved unanimously by the Coupa Board of
`Directors, is expected to close in the first half of 2023, subject to customary closing
`conditions, including approval by Coupa shareholders and the receipt of required
`regulatory approvals. The transaction is not subject to a financing condition.
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`Upon completion of the transaction, Coupa’s common stock will no longer be listed
`on any public market. The company will continue to operate under the Coupa name
`and brand.
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`Third Quarter 2023 Financial Results
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`In a separate press release, Coupa today announced its third quarter fiscal year 2023
`financial results. The press release is available on the Investor Relations section of
`the Company’s website. In light of the announced transaction with Thoma Bravo,
`Coupa has cancelled its earnings conference call previously scheduled for 1:30 p.m.
`PT / 4:30 p.m. ET this afternoon, December 12, 2022.
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`Advisors
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`Qatalyst Partners LP is serving as financial advisor to Coupa and Freshfields
`Bruckhaus Deringer LLP is serving as the company’s legal advisor.
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`Goldman Sachs & Co. LLC and Piper Sandler acted as financial advisors and
`Kirkland & Ellis LLP acted as legal advisor to Thoma Bravo.
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`The Materially Incomplete and Misleading Proxy Statement
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`21.
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`On January 23, 2023, the Board caused to be filed a materially incomplete and
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`misleading Proxy Statement with the SEC. The Proxy Statement, which recommends that Coupa
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`stockholders vote their shares in favor of the Proposed Transaction, fails to disclose material
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`information to Company stockholders, or provides them with materially misleading information,
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`concerning: (i) the Company’s financial projections; (ii) the financial analyses that support the
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`fairness opinion provided by the Company’s financial advisor Qatalyst; and (iii) potential conflicts
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`of interest faced by Company insiders.
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`Material Misrepresentations and/or Omissions Concerning Coupa’s Financial Projections
`
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`22.
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`The Proxy Statement fails to disclose material information concerning the financial
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`projections for the Company.
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`23.
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`For example, with respect to the Company’s “Financial Forecasts,” the Proxy
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`Statement fails to disclose all line items underlying: (i) Non-GAAP Operating Income; (ii)
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`Unlevered Free Cash Flow; and (iii) Adjusted Free Cash Flow.
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`24. Moreover, the Proxy Statement fails to disclose a summary of the prior sets of
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`Coupa management’s projections utilized or reviewed by Qatalyst or the Board in connection with
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`the sale process, or a description of the revisions made to the various projection sets, including
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`with respect to: (i) the “preliminary management plan and forecast” provided by Coupa
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`management to Qatalyst and utilized in connection with the October 21, 2022 Board meeting (see
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`Proxy Statement at 40); (ii) the “updated preliminary management plan and forecast” prepared by
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`Coupa management and reviewed with the Board at its October 30, 2022 Board meeting (see id.
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`at 42); and (iii) the “updated preliminary management plan” provided by Coupa management to
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`Qatalyst and utilized in connection with the November 18, 2022 Board meeting. See id. at 44.
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`Material Misrepresentations and/or Omissions Concerning Qatalyst’s Financial Analyses
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`25.
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`The Proxy Statement fails to disclose material information concerning Qatalyst’s
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`financial analyses.
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`26. With respect to Qatalyst’s Discounted Cash Flow Analysis, the Proxy Statement
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`fails to disclose a quantification of: (i) the Company’s terminal values; (ii) the inputs and
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`assumptions underlying the discount rates ranging from 9.5% to 13.0%; (iii) the cash and cash
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`equivalents of Coupa as of October 31, 2022; (iv) the Company’s estimated federal tax savings
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`due to its net operating losses for fiscal years 2028 and beyond; (v) the face value of Coupa’s
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`outstanding convertible notes as of October 31, 2022, and the Company’s redeemable non-
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`controlling interests in Coupa K.K.; and (vi) the Company’s fully diluted outstanding shares.
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`27. With respect to Qatalyst’s Selected Companies Analysis and Selected Transactions
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`Analysis, the Proxy Statement fails to disclose the individual financial metrics for each of the
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`selected companies and transactions, respectively.
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`Material Misrepresentations and/or Omissions Concerning Company Insiders’ Potential Conflicts
`of Interest
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`28.
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`The Proxy Statement fails to disclose material information concerning potential
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`conflicts of interest faced by Company insiders.
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`29.
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`Specifically, the Proxy Statement fails to disclose whether any of Thoma Bravo’s
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`proposals or indications of interest mentioned management retention in the combined company
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`following the Proposed Transaction or the purchase of or participation in the equity of the
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`surviving corporation.
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`30.
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`In sum, the omission of the above-referenced information renders statements in the
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`“Certain Financial Forecasts,” “Opinion of the Company’s Financial Advisor,” “Interests of the
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`Company’s Directors and Executive Officers in the Merger” and “Background of the Merger”
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`sections of the Proxy Statement materially incomplete and misleading in contravention of the
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`Exchange Act. Absent disclosure of the foregoing material information prior to the stockholder
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`vote, Plaintiff and the other stockholders of Coupa will be unable to make a sufficiently informed
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`Case 1:23-cv-00595 Document 1 Filed 01/24/23 Page 9 of 12
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`decision in connection with the Proposed Transaction and are thus threatened with irreparable
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`harm warranting the injunctive relief sought herein.
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`CLAIMS FOR RELIEF
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`COUNT I
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`Claims for Violation of Section 14(a) of the Exchange Act and Rule 14a-9 Promulgated
`Thereunder Against the Individual Defendants and Coupa
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`31.
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`32.
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`Plaintiff repeats and realleges the preceding allegations as if fully set forth herein.
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`The Individual Defendants disseminated the false and misleading Proxy Statement,
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`which contained statements that, in light of the circumstances under which they were made,
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`omitted to state material facts necessary to make the statements therein not materially misleading,
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`in violation of Section 14(a) of the Exchange Act and Rule 14a-9. Coupa is liable as the issuer of
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`these statements.
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`33.
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`The Proxy Statement was prepared, reviewed, and/or disseminated by the
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`Individual Defendants. By virtue of their positions within the Company, the Individual Defendants
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`were aware of this information and their duty to disclose this information in the Proxy Statement.
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`34.
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`The Individual Defendants were at least negligent in filing the Proxy Statement
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`with these materially false and misleading statements.
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`35.
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`The omissions and false and misleading statements in the Proxy Statement are
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`material in that a reasonable stockholder will consider them important in deciding how to vote on
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`the Proposed Transaction. In addition, a reasonable investor will view a full and accurate
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`disclosure as significantly altering the total mix of information made available in the Proxy
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`Statement and in other information reasonably available to stockholders.
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`36.
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`The Proxy Statement is an essential link in causing Plaintiff and the Company’s
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`stockholders to approve the Proposed Transaction.
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`37.
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`By reason of the foregoing, defendants violated Section 14(a) of the Exchange Act
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`and Rule 14a-9 promulgated thereunder.
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`38.
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`Because of the false and misleading statements in the Proxy Statement, Plaintiff is
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`threatened with irreparable harm.
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`COUNT II
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`Claims for Violation of Section 20(a) of the Exchange Act
`Against the Individual Defendants
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`Plaintiff repeats and realleges the preceding allegations as if fully set forth herein.
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`The Individual Defendants acted as controlling persons of Coupa within the
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`39.
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`40.
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`meaning of Section 20(a) of the Exchange Act as alleged herein. By virtue of their positions as
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`officers and/or directors of Coupa and participation in and/or awareness of the Company’s
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`operations and/or intimate knowledge of the false statements contained in the Proxy Statement,
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`they had the power to influence and control and did influence and control, directly or indirectly,
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`the decision making of the Company, including the content and dissemination of the various
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`statements that Plaintiff contends are false and misleading.
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`41.
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`Each of the Individual Defendants was provided with or had unlimited access to
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`copies of the Proxy Statement alleged by Plaintiff to be misleading prior to and/or shortly after
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`these statements were issued and had the ability to prevent the issuance of the statements or cause
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`them to be corrected.
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`42.
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`In particular, each of the Individual Defendants had direct and supervisory
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`involvement in the day-to-day operations of the Company, and, therefore, is presumed to have had
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`the power to control and influence the particular transactions giving rise to the violations as alleged
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`herein, and exercised the same. The Proxy Statement contains the unanimous recommendation of
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`the Individual Defendants to approve the Proposed Transaction. They were thus directly involved
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`in the making of the Proxy Statement.
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`43.
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`By virtue of the foregoing, the Individual Defendants violated Section 20(a) of the
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`Exchange Act.
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`44.
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`As set forth above, the Individual Defendants had the ability to exercise control
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`over and did control a person or persons who have each violated Section 14(a) of the Exchange
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`Act and Rule 14a-9, by their acts and omissions as alleged herein. By virtue of their positions as
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`controlling persons, these defendants are liable pursuant to Section 20(a) of the Exchange Act. As
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`a direct and proximate result of defendants’ conduct, Plaintiff is threatened with irreparable harm.
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`PRAYER FOR RELIEF
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`WHEREFORE, Plaintiff demands judgment and preliminary and permanent relief,
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`including injunctive relief, in his favor on behalf of Coupa, and against defendants, as follows:
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`A.
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`Preliminarily and permanently enjoining defendants and all persons acting in
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`concert with them from proceeding with, consummating, or closing the Proposed Transaction,
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`including the stockholder vote on the Proposed Transaction, unless and until defendants disclose
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`the material information identified above which has been omitted from the Proxy Statement;
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`B.
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`In the event defendants consummate the Proposed Transaction, rescinding it and
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`setting it aside or awarding rescissory damages to Plaintiff;
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`C.
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`Directing the Individual Defendants to file a Proxy Statement that does not contain
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`any untrue statements of material fact;
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`D.
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`Awarding Plaintiff the costs of this action, including reasonable allowance for
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`Plaintiff’s attorneys’ and experts’ fees; and
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`E.
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`Granting such other and further relief as this Court may deem just and proper.
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`JURY DEMAND
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`Plaintiff demands a trial by jury.
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`Dated: January 24, 2023
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`By
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`
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`ACOCELLI LAW, PLLC
`
`
`/s/ Richard A. Acocelli
`Richard A. Acocelli
`33 Flying Point Road, Suite 131
`Southampton, NY 11968
`Tel: (631) 204-6187
`Email: racocelli@acocellilaw.com
`
`Attorneys for Plaintiff
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