[10-Q] E2open Parent Holdings, Inc. Quarterly Earnings Report
Empire Petroleum (NYSE American: EP) filed an 8-K announcing the commencement of a $5.0 million registered rights offering, which includes $2.5 million to be raised immediately through unit subscriptions and another $2.5 million possible upon warrant exercise.
Shareholders of record on 10 July 2025 will receive one non-transferable subscription right per common share. Each right allows purchase of one unit at $5.30; every unit contains 0.0139 common shares and a warrant exercisable for 0.136 common shares. Rights must be exercised by 5:00 p.m. ET on 25 July 2025, while the warrants expire 90 days after the rights offering closes. An oversubscription privilege lets fully-participating holders acquire additional unsubscribed units on a pro-rata basis. No fractional shares will be issued.
Legal opinion (Exhibit 5.1), subscription documents (Exhibits 99.1-99.6) and a press release (Exhibit 99.7) accompany the filing. The company did not disclose specific use of proceeds beyond general corporate purposes.
Investor takeaways: (1) The raise bolsters near-term liquidity without incurring debt. (2) Full subscription and warrant exercise will increase share count, producing dilution for non-participating holders. (3) Non-transferable rights and a short exercise window could limit participation, magnifying dilution risk for passive investors.
Empire Petroleum (NYSE American: EP) ha presentato un modulo 8-K annunciando l'avvio di un offerta di diritti registrati da 5,0 milioni di dollari, che comprende 2,5 milioni di dollari da raccogliere immediatamente tramite sottoscrizioni di unit脿 e ulteriori 2,5 milioni di dollari potenziali attraverso l'esercizio di warrant.
Gli azionisti registrati al 10 luglio 2025 riceveranno un diritto di sottoscrizione non trasferibile per ogni azione ordinaria posseduta. Ogni diritto consente l'acquisto di un'unit脿 a 5,30 dollari; ogni unit脿 comprende 0,0139 azioni ordinarie e un warrant esercitabile per 0,136 azioni ordinarie. I diritti devono essere esercitati entro le 17:00 ET del 25 luglio 2025, mentre i warrant scadono 90 giorni dopo la chiusura dell'offerta di diritti. Un privilegio di sovrapposizione consente ai sottoscrittori completi di acquistare unit脿 aggiuntive non sottoscritte su base proporzionale. Non saranno emesse azioni frazionarie.
Alla documentazione allegata all'invio fanno parte un parere legale (Esibizione 5.1), documenti di sottoscrizione (Esibizioni 99.1-99.6) e un comunicato stampa (Esibizione 99.7). La societ脿 non ha specificato l'impiego dei proventi oltre a scopi aziendali generali.
Punti chiave per gli investitori: (1) L'aumento di capitale rafforza la liquidit脿 a breve termine senza indebitamento. (2) La sottoscrizione completa e l'esercizio dei warrant aumenteranno il numero di azioni, causando diluizione per gli azionisti non partecipanti. (3) I diritti non trasferibili e la finestra di esercizio limitata potrebbero ridurre la partecipazione, aumentando il rischio di diluizione per gli investitori passivi.
Empire Petroleum (NYSE American: EP) present贸 un formulario 8-K anunciando el inicio de una oferta de derechos registrada por 5,0 millones de d贸lares, que incluye 2,5 millones de d贸lares a recaudar inmediatamente mediante suscripciones de unidades y otros 2,5 millones posibles mediante el ejercicio de warrants.
Los accionistas registrados al 10 de julio de 2025 recibir谩n un derecho de suscripci贸n no transferible por cada acci贸n com煤n. Cada derecho permite comprar una unidad a 5,30 d贸lares; cada unidad contiene 0,0139 acciones comunes y un warrant ejercitable por 0,136 acciones comunes. Los derechos deben ejercerse antes de las 5:00 p.m. ET del 25 de julio de 2025, mientras que los warrants expiran 90 d铆as despu茅s del cierre de la oferta de derechos. Un privilegio de sobresuscripci贸n permite a los titulares que participan plenamente adquirir unidades adicionales no suscritas de forma proporcional. No se emitir谩n acciones fraccionarias.
La presentaci贸n incluye una opini贸n legal (Anexo 5.1), documentos de suscripci贸n (Anexos 99.1-99.6) y un comunicado de prensa (Anexo 99.7). La empresa no divulg贸 un uso espec铆fico de los fondos m谩s all谩 de prop贸sitos corporativos generales.
Puntos clave para inversores: (1) La recaudaci贸n fortalece la liquidez a corto plazo sin incurrir en deuda. (2) La suscripci贸n completa y el ejercicio de los warrants aumentar谩n el n煤mero de acciones, causando diluci贸n para los accionistas que no participen. (3) Los derechos no transferibles y la ventana corta para ejercerlos podr铆an limitar la participaci贸n, aumentando el riesgo de diluci贸n para los inversores pasivos.
Empire Petroleum (NYSE American: EP)电� 500毵� 雼煬 攴滊鞚� 霌彪 甓岆Μ 瓿惦 臧滌嫓毳� 鞎岆Μ电� 8-K 靹滊毳� 鞝滌稖頄堨溂氅�, 鞚� 欷� 250毵� 雼煬电� 雼渼 甑弲鞚� 韱淀暣 歃夓嫓 臁半嫭頃橁碃 雮橂ǜ歆� 250毵� 雼煬电� 鞗岆煱韸� 頄夓偓 鞁� 臁半嫭頃� 鞓堨爼鞛呺媹雼�.
2025雲� 7鞗� 10鞚� 旮办 欤检＜霌れ潃 氤错喌欤� 1欤茧嫻 1臧滌潣 鞏戨弰 攵堦皜電ロ暅 甑弲 甓岆Μ毳� 氚涥矊 霅╇媹雼�. 臧� 甓岆Μ电� 5.30雼煬鞐� 1雼渼毳� 甑Г頃� 靾� 鞛埖鐢 甓岆Μ鞚措┌, 臧� 雼渼电� 0.0139 氤错喌欤检檧 0.136 氤错喌欤� 頄夓偓 臧�電ロ暅 鞗岆煱韸鸽ゼ 韽暔頃╇媹雼�. 甓岆Μ电� 2025雲� 7鞗� 25鞚� 霃欕秬鞁滉皠 鞓ろ泟 5鞁�旯岇 頄夓偓頃挫暭 頃橂┌, 鞗岆煱韸傅鐢 甓岆Μ 瓿惦 膦呺 頉� 90鞚� 頉勳棎 毵岆霅╇媹雼�. 齑堦臣 觳暯 甓岉暅鞚� 韱淀暣 鞝勳暋 彀胳棳頃� 欤检＜电� 牍勳箔鞎� 雼渼毳� 牍勲 氚半秳 氚╈嫕鞙茧 於旉皜 甑Г頃� 靾� 鞛堨姷雼堧嫟. 攵勴暊 欤检嫕鞚� 氚滍枆霅橃 鞎婌姷雼堧嫟.
氩曤 鞚橁铂靹�(歃濍箼 5.1), 甑弲 氍胳劀(歃濍箼 99.1-99.6), 氤措弰鞛愲(歃濍箼 99.7)臧� 鞝滌稖 靹滊鞐� 韽暔霅橃柎 鞛堨姷雼堧嫟. 須岇偓电� 鞛愱笀 靷毄 氇╈爜鞚� 鞚茧皹鞝侅澑 旮办梾 氇╈爜 鞕胳棎 甑泊鞝侅溂搿� 氚濏瀳歆� 鞎婌晿鞀惦媹雼�.
韴瀽鞛� 鞙犾潣靷暛: (1) 鞚措矆 鞛愱笀 臁半嫭鞚� 攵�毂� 鞐嗢澊 雼赴 鞙犽彊靹膘潉 臧曧檾頃╇媹雼�. (2) 鞝勳暋 甑弲 氚� 鞗岆煱韸� 頄夓偓 鞁� 欤检嫕 靾橁皜 歃濌皜頃� 牍勳案鞐� 欤检＜鞐愱矊 頋劃 須臣臧� 氚滌儩頃╇媹雼�. (3) 鞏戨弰 攵堦皜電ロ暅 甓岆Μ鞕� 歆ъ潃 頄夓偓 旮瓣皠鞚� 彀胳棳毳� 鞝滍暅頃� 靾� 鞛堨柎 靾橂彊鞝� 韴瀽鞛愳棎瓴� 頋劃 鞙勴棙鞚� 韨れ毟 靾� 鞛堨姷雼堧嫟.
Empire Petroleum (NYSE American : EP) a d茅pos茅 un formulaire 8-K annon莽ant le lancement d'une offre de droits enregistr茅e de 5,0 millions de dollars, comprenant 2,5 millions 脿 lever imm茅diatement via des souscriptions d'unit茅s et 2,5 millions suppl茅mentaires possibles par l'exercice de bons de souscription (warrants).
Les actionnaires inscrits au 10 juillet 2025 recevront un droit de souscription non transf茅rable par action ordinaire d茅tenue. Chaque droit permet d'acheter une unit茅 脿 5,30 $ ; chaque unit茅 comprend 0,0139 action ordinaire et un warrant exer莽able pour 0,136 action ordinaire. Les droits doivent 锚tre exerc茅s avant 17h00 ET le 25 juillet 2025, tandis que les warrants expirent 90 jours apr猫s la cl么ture de l'offre. Un privil猫ge de suscription suppl茅mentaire permet aux d茅tenteurs pleinement participants d'acqu茅rir des unit茅s additionnelles non souscrites au prorata. Aucune action fractionn茅e ne sera 茅mise.
L'avis juridique (Annexe 5.1), les documents de souscription (Annexes 99.1-99.6) et un communiqu茅 de presse (Annexe 99.7) accompagnent le d茅p么t. La soci茅t茅 n'a pas pr茅cis茅 l'utilisation des fonds au-del脿 d'objectifs g茅n茅raux d'entreprise.
Points cl茅s pour les investisseurs : (1) Cette lev茅e de fonds renforce la liquidit茅 脿 court terme sans endettement. (2) La souscription compl猫te et l'exercice des warrants augmenteront le nombre d'actions, entra卯nant une dilution pour les actionnaires non participants. (3) Les droits non transf茅rables et la courte p茅riode d'exercice pourraient limiter la participation, augmentant le risque de dilution pour les investisseurs passifs.
Empire Petroleum (NYSE American: EP) hat eine 8-K-Meldung eingereicht, in der der Beginn eines registrierten Bezugsrechtsangebots in H枚he von 5,0 Millionen US-Dollar angek眉ndigt wird. Davon sollen 2,5 Millionen US-Dollar sofort durch Zeichnung von Einheiten eingeworben werden, weitere 2,5 Millionen US-Dollar sind durch Aus眉bung von Warrants m枚glich.
Aktion盲re, die am 10. Juli 2025 im Aktienregister stehen, erhalten f眉r jede Stammaktie ein nicht 眉bertragbares Bezugsrecht. Jedes Recht berechtigt zum Kauf einer Einheit zu 5,30 US-Dollar; jede Einheit enth盲lt 0,0139 Stammaktien und einen Warrant, der zum Kauf von 0,136 Stammaktien berechtigt. Die Rechte m眉ssen bis sp盲testens 17:00 Uhr ET am 25. Juli 2025 ausge眉bt werden, die Warrants verfallen 90 Tage nach Ablauf des Bezugsrechtsangebots. Ein 脺产别谤锄别颈肠丑苍耻苍驳蝉谤别肠丑迟 erm枚glicht es voll teilnehmenden Aktion盲ren, zus盲tzliche nicht gezeichnete Einheiten anteilig zu erwerben. Bruchteile von Aktien werden nicht ausgegeben.
Dem Einreichungsdokument sind ein Rechtsgutachten (Anlage 5.1), Zeichnungsunterlagen (Anlagen 99.1-99.6) und eine Pressemitteilung (Anlage 99.7) beigef眉gt. Das Unternehmen hat keine spezifische Verwendung der Erl枚se 眉ber allgemeine Unternehmenszwecke hinaus angegeben.
Wichtige Hinweise f眉r Investoren: (1) Die Kapitalerh枚hung st盲rkt die kurzfristige Liquidit盲t ohne Aufnahme von Schulden. (2) Vollst盲ndige Zeichnung und Aus眉bung der Warrants f眉hren zu einer Erh枚hung der Aktienanzahl und damit zu einer Verw盲sserung f眉r nicht teilnehmende Aktion盲re. (3) Nicht 眉bertragbare Rechte und ein kurzer Aus眉bungszeitraum k枚nnten die Teilnahme einschr盲nken und das Verw盲sserungsrisiko f眉r passive Investoren erh枚hen.
- Improved liquidity: Up to $5.0 million in fresh equity capital strengthens cash position without adding debt.
- Shareholder participation: All existing holders receive rights and an oversubscription privilege, allowing maintenance of ownership percentage if they invest.
- Dilution risk: Full subscription plus warrant exercise will expand share count, reducing EPS for non-participating shareholders.
- Non-transferable rights: Inability to sell rights limits flexibility and may lower participation, increasing dilution concentration.
- Short exercise periods: 15-day rights window and 90-day warrant life compress decision timelines and introduce execution uncertainty.
Insights
TL;DR: $5 m rights offering provides cash but modest dilution; net impact likely neutral given small size relative to float.
The transaction represents roughly a mid-single-digit percentage of Empire Petroleum鈥檚 market capitalisation, supplying inexpensive equity capital without additional leverage. Because every shareholder receives rights, the offer is shareholder-friendly, yet non-participating investors will face dilution from up to 0.1499 new shares per unit once warrants are exercised. Strong take-up would limit dilution, while low participation could leave the company short of funds. Overall liquidity improves, balance-sheet risk declines, and no covenants are added, balancing the dilution downside 鈥� hence a neutral outlook.
TL;DR: Dilutive equity raise flags funding need; non-transferable rights pressure holders, skewing risk鈥搑eward negatively.
The structure forces shareholders to supply fresh capital or accept dilution, suggesting limited alternative financing options. The unit鈥檚 minuscule initial share component (0.0139 shares) combined with a sizeable warrant (0.136 shares) heavily back-ends dilution into the next quarter. The rapid 15-day subscription and 90-day warrant windows create execution risk. Absent clear disclosure of proceeds deployment, the capital raise is a stop-gap rather than strategic growth funding. For portfolio construction, the potential dilution outweighs modest liquidity improvement, warranting a cautious stance.
Empire Petroleum (NYSE American: EP) ha presentato un modulo 8-K annunciando l'avvio di un offerta di diritti registrati da 5,0 milioni di dollari, che comprende 2,5 milioni di dollari da raccogliere immediatamente tramite sottoscrizioni di unit脿 e ulteriori 2,5 milioni di dollari potenziali attraverso l'esercizio di warrant.
Gli azionisti registrati al 10 luglio 2025 riceveranno un diritto di sottoscrizione non trasferibile per ogni azione ordinaria posseduta. Ogni diritto consente l'acquisto di un'unit脿 a 5,30 dollari; ogni unit脿 comprende 0,0139 azioni ordinarie e un warrant esercitabile per 0,136 azioni ordinarie. I diritti devono essere esercitati entro le 17:00 ET del 25 luglio 2025, mentre i warrant scadono 90 giorni dopo la chiusura dell'offerta di diritti. Un privilegio di sovrapposizione consente ai sottoscrittori completi di acquistare unit脿 aggiuntive non sottoscritte su base proporzionale. Non saranno emesse azioni frazionarie.
Alla documentazione allegata all'invio fanno parte un parere legale (Esibizione 5.1), documenti di sottoscrizione (Esibizioni 99.1-99.6) e un comunicato stampa (Esibizione 99.7). La societ脿 non ha specificato l'impiego dei proventi oltre a scopi aziendali generali.
Punti chiave per gli investitori: (1) L'aumento di capitale rafforza la liquidit脿 a breve termine senza indebitamento. (2) La sottoscrizione completa e l'esercizio dei warrant aumenteranno il numero di azioni, causando diluizione per gli azionisti non partecipanti. (3) I diritti non trasferibili e la finestra di esercizio limitata potrebbero ridurre la partecipazione, aumentando il rischio di diluizione per gli investitori passivi.
Empire Petroleum (NYSE American: EP) present贸 un formulario 8-K anunciando el inicio de una oferta de derechos registrada por 5,0 millones de d贸lares, que incluye 2,5 millones de d贸lares a recaudar inmediatamente mediante suscripciones de unidades y otros 2,5 millones posibles mediante el ejercicio de warrants.
Los accionistas registrados al 10 de julio de 2025 recibir谩n un derecho de suscripci贸n no transferible por cada acci贸n com煤n. Cada derecho permite comprar una unidad a 5,30 d贸lares; cada unidad contiene 0,0139 acciones comunes y un warrant ejercitable por 0,136 acciones comunes. Los derechos deben ejercerse antes de las 5:00 p.m. ET del 25 de julio de 2025, mientras que los warrants expiran 90 d铆as despu茅s del cierre de la oferta de derechos. Un privilegio de sobresuscripci贸n permite a los titulares que participan plenamente adquirir unidades adicionales no suscritas de forma proporcional. No se emitir谩n acciones fraccionarias.
La presentaci贸n incluye una opini贸n legal (Anexo 5.1), documentos de suscripci贸n (Anexos 99.1-99.6) y un comunicado de prensa (Anexo 99.7). La empresa no divulg贸 un uso espec铆fico de los fondos m谩s all谩 de prop贸sitos corporativos generales.
Puntos clave para inversores: (1) La recaudaci贸n fortalece la liquidez a corto plazo sin incurrir en deuda. (2) La suscripci贸n completa y el ejercicio de los warrants aumentar谩n el n煤mero de acciones, causando diluci贸n para los accionistas que no participen. (3) Los derechos no transferibles y la ventana corta para ejercerlos podr铆an limitar la participaci贸n, aumentando el riesgo de diluci贸n para los inversores pasivos.
Empire Petroleum (NYSE American: EP)电� 500毵� 雼煬 攴滊鞚� 霌彪 甓岆Μ 瓿惦 臧滌嫓毳� 鞎岆Μ电� 8-K 靹滊毳� 鞝滌稖頄堨溂氅�, 鞚� 欷� 250毵� 雼煬电� 雼渼 甑弲鞚� 韱淀暣 歃夓嫓 臁半嫭頃橁碃 雮橂ǜ歆� 250毵� 雼煬电� 鞗岆煱韸� 頄夓偓 鞁� 臁半嫭頃� 鞓堨爼鞛呺媹雼�.
2025雲� 7鞗� 10鞚� 旮办 欤检＜霌れ潃 氤错喌欤� 1欤茧嫻 1臧滌潣 鞏戨弰 攵堦皜電ロ暅 甑弲 甓岆Μ毳� 氚涥矊 霅╇媹雼�. 臧� 甓岆Μ电� 5.30雼煬鞐� 1雼渼毳� 甑Г頃� 靾� 鞛埖鐢 甓岆Μ鞚措┌, 臧� 雼渼电� 0.0139 氤错喌欤检檧 0.136 氤错喌欤� 頄夓偓 臧�電ロ暅 鞗岆煱韸鸽ゼ 韽暔頃╇媹雼�. 甓岆Μ电� 2025雲� 7鞗� 25鞚� 霃欕秬鞁滉皠 鞓ろ泟 5鞁�旯岇 頄夓偓頃挫暭 頃橂┌, 鞗岆煱韸傅鐢 甓岆Μ 瓿惦 膦呺 頉� 90鞚� 頉勳棎 毵岆霅╇媹雼�. 齑堦臣 觳暯 甓岉暅鞚� 韱淀暣 鞝勳暋 彀胳棳頃� 欤检＜电� 牍勳箔鞎� 雼渼毳� 牍勲 氚半秳 氚╈嫕鞙茧 於旉皜 甑Г頃� 靾� 鞛堨姷雼堧嫟. 攵勴暊 欤检嫕鞚� 氚滍枆霅橃 鞎婌姷雼堧嫟.
氩曤 鞚橁铂靹�(歃濍箼 5.1), 甑弲 氍胳劀(歃濍箼 99.1-99.6), 氤措弰鞛愲(歃濍箼 99.7)臧� 鞝滌稖 靹滊鞐� 韽暔霅橃柎 鞛堨姷雼堧嫟. 須岇偓电� 鞛愱笀 靷毄 氇╈爜鞚� 鞚茧皹鞝侅澑 旮办梾 氇╈爜 鞕胳棎 甑泊鞝侅溂搿� 氚濏瀳歆� 鞎婌晿鞀惦媹雼�.
韴瀽鞛� 鞙犾潣靷暛: (1) 鞚措矆 鞛愱笀 臁半嫭鞚� 攵�毂� 鞐嗢澊 雼赴 鞙犽彊靹膘潉 臧曧檾頃╇媹雼�. (2) 鞝勳暋 甑弲 氚� 鞗岆煱韸� 頄夓偓 鞁� 欤检嫕 靾橁皜 歃濌皜頃� 牍勳案鞐� 欤检＜鞐愱矊 頋劃 須臣臧� 氚滌儩頃╇媹雼�. (3) 鞏戨弰 攵堦皜電ロ暅 甓岆Μ鞕� 歆ъ潃 頄夓偓 旮瓣皠鞚� 彀胳棳毳� 鞝滍暅頃� 靾� 鞛堨柎 靾橂彊鞝� 韴瀽鞛愳棎瓴� 頋劃 鞙勴棙鞚� 韨れ毟 靾� 鞛堨姷雼堧嫟.
Empire Petroleum (NYSE American : EP) a d茅pos茅 un formulaire 8-K annon莽ant le lancement d'une offre de droits enregistr茅e de 5,0 millions de dollars, comprenant 2,5 millions 脿 lever imm茅diatement via des souscriptions d'unit茅s et 2,5 millions suppl茅mentaires possibles par l'exercice de bons de souscription (warrants).
Les actionnaires inscrits au 10 juillet 2025 recevront un droit de souscription non transf茅rable par action ordinaire d茅tenue. Chaque droit permet d'acheter une unit茅 脿 5,30 $ ; chaque unit茅 comprend 0,0139 action ordinaire et un warrant exer莽able pour 0,136 action ordinaire. Les droits doivent 锚tre exerc茅s avant 17h00 ET le 25 juillet 2025, tandis que les warrants expirent 90 jours apr猫s la cl么ture de l'offre. Un privil猫ge de suscription suppl茅mentaire permet aux d茅tenteurs pleinement participants d'acqu茅rir des unit茅s additionnelles non souscrites au prorata. Aucune action fractionn茅e ne sera 茅mise.
L'avis juridique (Annexe 5.1), les documents de souscription (Annexes 99.1-99.6) et un communiqu茅 de presse (Annexe 99.7) accompagnent le d茅p么t. La soci茅t茅 n'a pas pr茅cis茅 l'utilisation des fonds au-del脿 d'objectifs g茅n茅raux d'entreprise.
Points cl茅s pour les investisseurs : (1) Cette lev茅e de fonds renforce la liquidit茅 脿 court terme sans endettement. (2) La souscription compl猫te et l'exercice des warrants augmenteront le nombre d'actions, entra卯nant une dilution pour les actionnaires non participants. (3) Les droits non transf茅rables et la courte p茅riode d'exercice pourraient limiter la participation, augmentant le risque de dilution pour les investisseurs passifs.
Empire Petroleum (NYSE American: EP) hat eine 8-K-Meldung eingereicht, in der der Beginn eines registrierten Bezugsrechtsangebots in H枚he von 5,0 Millionen US-Dollar angek眉ndigt wird. Davon sollen 2,5 Millionen US-Dollar sofort durch Zeichnung von Einheiten eingeworben werden, weitere 2,5 Millionen US-Dollar sind durch Aus眉bung von Warrants m枚glich.
Aktion盲re, die am 10. Juli 2025 im Aktienregister stehen, erhalten f眉r jede Stammaktie ein nicht 眉bertragbares Bezugsrecht. Jedes Recht berechtigt zum Kauf einer Einheit zu 5,30 US-Dollar; jede Einheit enth盲lt 0,0139 Stammaktien und einen Warrant, der zum Kauf von 0,136 Stammaktien berechtigt. Die Rechte m眉ssen bis sp盲testens 17:00 Uhr ET am 25. Juli 2025 ausge眉bt werden, die Warrants verfallen 90 Tage nach Ablauf des Bezugsrechtsangebots. Ein 脺产别谤锄别颈肠丑苍耻苍驳蝉谤别肠丑迟 erm枚glicht es voll teilnehmenden Aktion盲ren, zus盲tzliche nicht gezeichnete Einheiten anteilig zu erwerben. Bruchteile von Aktien werden nicht ausgegeben.
Dem Einreichungsdokument sind ein Rechtsgutachten (Anlage 5.1), Zeichnungsunterlagen (Anlagen 99.1-99.6) und eine Pressemitteilung (Anlage 99.7) beigef眉gt. Das Unternehmen hat keine spezifische Verwendung der Erl枚se 眉ber allgemeine Unternehmenszwecke hinaus angegeben.
Wichtige Hinweise f眉r Investoren: (1) Die Kapitalerh枚hung st盲rkt die kurzfristige Liquidit盲t ohne Aufnahme von Schulden. (2) Vollst盲ndige Zeichnung und Aus眉bung der Warrants f眉hren zu einer Erh枚hung der Aktienanzahl und damit zu einer Verw盲sserung f眉r nicht teilnehmende Aktion盲re. (3) Nicht 眉bertragbare Rechte und ein kurzer Aus眉bungszeitraum k枚nnten die Teilnahme einschr盲nken und das Verw盲sserungsrisiko f眉r passive Investoren erh枚hen.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number:
(Exact Name of Registrant as Specified in its Charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer |
(Address of principal executive offices) |
(Zip Code) |
Registrant's telephone number, including area code: (
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
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Trading Symbol(s) |
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Name of each exchange on which registered |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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Accelerated filer |
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Non-accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
As of July 8, 2025, E2open Parent Holdings, Inc. had
Table of Contents
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Page |
Glossary |
|
3 |
Forward-Looking Statements |
4 |
|
PART I. |
|
6 |
Item 1. |
Financial Statements (Unaudited) |
6 |
|
Condensed Consolidated Balance Sheets |
6 |
|
Condensed Consolidated Statements of Operations |
7 |
|
Condensed Consolidated Statements of Comprehensive Loss |
8 |
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Condensed Consolidated Statements of Stockholders' Equity |
9 |
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Condensed Consolidated Statements of Cash Flows |
10 |
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Notes to the Unaudited Condensed Consolidated Financial Statements |
11 |
Item 2. |
Management's Discussion and Analysis of Financial Condition and Results of Operations |
33 |
Item 3. |
Quantitative and Qualitative Disclosures About Market Risk |
45 |
Item 4. |
Controls and Procedures |
45 |
PART II. |
Other Information |
45 |
Item 1. |
Legal Proceedings |
45 |
Item 1A. |
Risk Factors |
45 |
Item 5. |
Other Information |
47 |
Item 6. |
Exhibits |
48 |
Signatures |
49 |
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2
Glossary of Terms
Abbreviation |
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Term |
ASC |
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Accounting Standards Codification |
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Black-Scholes Warrant Value |
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Value of a warrant immediately prior to the closing of an applicable event based on the Black-Scholes warrant model for a Capped American Call on the Bloomberg Financial Markets. The price of each Class A common stock shall be (1) the volume weighted average price of the Class A common stock as reported during the ten-trading day period ending on the trading day prior to the effective date of the applicable event, (2) the assumed volatility shall be the 90-day volatility obtained from the HVT function on Bloomberg determined as of the trading day immediately prior to the day of the announcement of the applicable event, and (3) the assumed risk-free interest rate shall be the U.S. Treasury rate for the period equal to the remaining term of the warrant. |
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Class A Common Stock |
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Class A common stock, par value $0.0001 per share |
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Class V Common Stock |
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Class V common stock, par value $0.0001 per share |
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Common Units |
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common units representing limited liability company interests of E2open Holdings, LLC, which are non-voting, economic interests in E2open Holdings, LLC. Every economic common unit is tied to one voting share of Class V Common Stock of E2open Parent Holdings, Inc. |
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Forward Purchase Agreement |
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agreement dated as of April 28, 2020, by and between CCNB1 and Neuberger Berman Opportunistic Capital Solutions Master Fund LP |
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Forward Purchase Warrants |
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5,000,000 redeemable warrants purchased pursuant to the Forward Purchase Agreement |
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nm |
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not meaningful |
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NYSE |
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New York Stock Exchange |
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RCU |
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restricted common units representing Series 2 of E2open Holdings, LLC |
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SCM |
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omni-channel and supply chain management |
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SEC |
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U.S. Securities and Exchange Commission |
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SOFR |
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Secured Overnight Financing Rate |
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SONIA |
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Sterling Overnight Index Average |
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U.S. GAAP |
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generally accepted accounting principles in the United States |
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VWAP |
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daily per share volume-weighted average price of the Class A Common Stock on the NYSE as displayed on the Bloomberg page under the heading Bloomberg VWAP |
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Warrant Price |
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Price per share at which a Class A Common Stock may be purchased at the time a warrant is exercised |
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WiseTech |
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WiseTech Global Limited, an Australian public company limited by shares |
3
Forward-Looking Statements
This Quarterly Report on Form 10-Q (Quarterly Report) contains "forward-looking statements" within the meaning of the federal securities laws, and are subject to the safe harbor created under the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that do not relate solely to historical or current facts, and generally can be identified by the use of words such as "may," "can," "should," "will," "estimate," "plan," "project," "forecast," "intend," "expect," "anticipate," "believe," "seek," "target" and similar expressions or future or conditional verbs. Without limiting the generality of the forgoing, forward-looking statements contained in this document include expectations regarding the future growth, operational and financial performance and business prospects and opportunities.
These forward-looking statements are based on information available as of the date of this Quarterly Report and management's current expectations, forecasts and assumptions, and involve a number of judgments, known and unknown risks and uncertainties and other factors, many of which are outside the control of E2open Parent Holdings, Inc. (we, our, us, Company, E2open) and outside the control of our directors, officers and affiliates. Accordingly, we can give no assurance that any expectation or belief will result or will be achieved or accomplished. Investors therefore should not place undue reliance on forward-looking statements.
As a result of a number of known and unknown risks and uncertainties, our results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include:
More information on factors that could cause our actual results or events to differ from those expressed in forward-looking statements are included from time to time in our reports filed with the SEC including in Part I, Item 1A, Risk Factors in our Annual Report on Form 10-K for the fiscal year ended February 28, 2025, filed with the SEC on April 29, 2025 (2025 Form 10-K).
4
All forward-looking statements speak only as of the date of this Quarterly Report and are expressly qualified in their entirety by the cautionary statements included in or incorporated by reference into this Quarterly Report. We do not undertake any obligation to update, add or to otherwise correct any forward-looking statements contained herein to reflect events or circumstances after the date they were made, whether as a result of new information, future events, inaccuracies that become apparent after the date hereof or otherwise, except as required by law.
5
PART I—Financial Information
Item 1. Financial Statements.
E2open Parent Holdings, Inc.
Condensed Consolidated Balance Sheets
(In thousands, except share and per share amounts) |
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May 31, 2025 |
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February 28, 2025 |
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(Unaudited) |
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Assets |
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Cash and cash equivalents |
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$ |
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$ |
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Restricted cash |
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Accounts receivable, net of allowance |
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Prepaid expenses and other current assets |
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Total current assets |
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Goodwill |
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Intangible assets, net |
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Property and equipment, net |
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Operating lease right-of-use assets |
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Other noncurrent assets |
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Total assets |
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$ |
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$ |
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Liabilities, Redeemable Share-Based Awards and Stockholders' Equity |
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Accounts payable and accrued liabilities |
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$ |
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$ |
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Channel client deposits payable |
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Deferred revenue |
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Current portion of tax receivable agreement liability |
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Current portion of notes payable |
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Current portion of operating lease obligations |
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Current portion of financing lease obligations |
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Income taxes payable |
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Total current liabilities |
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Long-term deferred revenue |
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Operating lease obligations |
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Financing lease obligations |
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Notes payable |
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Tax receivable agreement liability |
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Warrant liability |
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Contingent consideration |
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Deferred taxes |
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Other noncurrent liabilities |
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Total liabilities |
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Commitments and Contingencies (Note 24) |
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Redeemable share-based awards |
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Stockholders' Equity |
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Class A common stock; $ |
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Class V common stock; $ |
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Series B-1 common stock; $ |
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Series B-2 common stock; $ |
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Additional paid-in capital |
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Accumulated other comprehensive loss |
` |
|
( |
) |
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( |
) |
Accumulated deficit |
|
|
( |
) |
|
|
( |
) |
Treasury stock, at cost: |
|
|
( |
) |
|
|
( |
) |
Total E2open Parent Holdings, Inc. equity |
|
|
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Noncontrolling interest |
|
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Total stockholders' equity |
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||
Total liabilities, redeemable share-based awards and stockholders' equity |
|
$ |
|
|
$ |
|
||
See notes to the unaudited condensed consolidated financial statements.
6
E2open Parent Holdings, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
|
|
Three Months Ended May 31, |
|
|||||
(In thousands, except per share amounts) |
|
2025 |
|
|
2024 |
|
||
Revenue |
|
|
|
|
|
|
||
Subscriptions |
|
$ |
|
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$ |
|
||
Professional services and other |
|
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||
Total revenue |
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Cost of Revenue |
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Subscriptions |
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Professional services and other |
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Amortization of acquired intangible assets |
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Total cost of revenue |
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Gross Profit |
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Operating Expenses |
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Research and development |
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Sales and marketing |
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General and administrative |
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Acquisition-related expenses |
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Amortization of acquired intangible assets |
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||
Total operating expenses |
|
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|
||
Loss from operations |
|
|
( |
) |
|
|
( |
) |
Other income (expense) |
|
|
|
|
|
|
||
Interest and other expense, net |
|
|
( |
) |
|
|
( |
) |
Gain (loss) from change in tax receivable agreement liability |
|
|
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( |
) |
|
Gain from change in fair value of warrant liability |
|
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||
Loss from change in fair value of contingent consideration |
|
|
( |
) |
|
|
( |
) |
Total other expense |
|
|
( |
) |
|
|
( |
) |
Loss before income tax provision |
|
|
( |
) |
|
|
( |
) |
Income tax (expense) benefit |
|
|
( |
) |
|
|
|
|
Net loss |
|
|
( |
) |
|
|
( |
) |
Less: Net loss attributable to noncontrolling interest |
|
|
( |
) |
|
|
( |
) |
Net loss attributable to E2open Parent Holdings, Inc. |
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
||
Weighted average common shares outstanding: |
|
|
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|
|
|
||
Basic |
|
|
|
|
|
|
||
Diluted |
|
|
|
|
|
|
||
Net loss attributable to E2open Parent Holdings, Inc. |
|
|
|
|
|
|
||
Basic |
|
$ |
( |
) |
|
$ |
( |
) |
Diluted |
|
$ |
( |
) |
|
$ |
( |
) |
See notes to the unaudited condensed consolidated financial statements.
7
E2open Parent Holdings, Inc.
Condensed Consolidated Statements of Comprehensive Loss
(Unaudited)
|
|
Three Months Ended May 31, |
|
|||||
(In thousands) |
|
2025 |
|
|
2024 |
|
||
Net loss |
|
$ |
( |
) |
|
$ |
( |
) |
Other comprehensive (loss) income, net: |
|
|
|
|
|
|
||
Net foreign currency translation gain, net of tax |
|
|
|
|
|
|
||
Net deferred losses on foreign exchange forward contracts |
|
|
|
|
|
( |
) |
|
Net deferred gains on interest rate collars |
|
|
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|
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|
||
Total other comprehensive income, net |
|
|
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|
|
|
||
Comprehensive loss |
|
|
|
|
|
( |
) |
|
Less: Comprehensive loss attributable to noncontrolling interest |
|
|
|
|
|
( |
) |
|
Comprehensive loss attributable to E2open Parent Holdings, Inc. |
|
$ |
|
|
$ |
( |
) |
|
See notes to the unaudited condensed consolidated financial statements.
8
E2open Parent Holdings, Inc.
Condensed Consolidated Statements of Stockholders' Equity
(Unaudited)
(In thousands) |
|
Common |
|
|
Additional |
|
|
Accumulated |
|
|
Accumulated |
|
|
Treasury Stock |
|
|
Total |
|
|
Noncontrolling |
|
|
Total |
|
||||||||
Balance, February 29, 2024 |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Share-based compensation |
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
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|
|||
Conversion of Common |
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
||
Vesting of restricted stock |
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Impact of Common Unit |
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Issuance of common stock |
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|||
Reclassification of |
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Other comprehensive income |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|||
Net loss |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Balance, May 31, 2024 |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||||
(In thousands) |
|
Common |
|
|
Additional |
|
|
Accumulated |
|
|
Accumulated |
|
|
Treasury Stock |
|
|
Total |
|
|
Noncontrolling |
|
|
Total |
|
||||||||
Balance, February 28, 2025 |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Share-based compensation |
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|||
Vesting of restricted stock |
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Reclassification of |
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|||
Other comprehensive income |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|||
Net loss |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Balance, May 31, 2025 |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||||
See notes to the unaudited condensed consolidated financial statements.
9
E2open Parent Holdings, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
|
|
Three Months Ended May 31, |
|
|||||
(In thousands) |
|
2025 |
|
|
2024 |
|
||
Cash flows from operating activities |
|
|
|
|
|
|
||
Net loss |
|
$ |
( |
) |
|
$ |
( |
) |
Adjustments to reconcile net loss to net cash from operating activities: |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
|
|
|
|
||
Amortization of deferred commissions |
|
|
|
|
|
|
||
Provision for credit losses |
|
|
|
|
|
|
||
Amortization of debt issuance costs |
|
|
|
|
|
|
||
Amortization of operating lease right-of-use assets |
|
|
|
|
|
|
||
Share-based compensation |
|
|
|
|
|
|
||
Deferred income taxes |
|
|
( |
) |
|
|
( |
) |
Right-of-use assets impairment charge |
|
|
|
|
|
|
||
(Gain) loss from change in tax receivable agreement liability |
|
|
( |
) |
|
|
|
|
Gain from change in fair value of warrant liability |
|
|
( |
) |
|
|
( |
) |
Loss from change in fair value of contingent consideration |
|
|
|
|
|
|
||
(Gain) loss on disposal of property and equipment |
|
|
( |
) |
|
|
|
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
||
Accounts receivable |
|
|
|
|
|
|
||
Prepaid expenses and other current assets |
|
|
( |
) |
|
|
( |
) |
Other noncurrent assets |
|
|
( |
) |
|
|
( |
) |
Accounts payable and accrued liabilities |
|
|
|
|
|
( |
) |
|
Channel client deposits payable |
|
|
( |
) |
|
|
|
|
Deferred revenue |
|
|
( |
) |
|
|
( |
) |
Changes in other liabilities |
|
|
|
|
|
|
||
Net cash provided by operating activities |
|
|
|
|
|
|
||
Cash flows from investing activities |
|
|
|
|
|
|
||
Capital expenditures |
|
|
( |
) |
|
|
( |
) |
Net cash used in investing activities |
|
|
( |
) |
|
|
( |
) |
Cash flows from financing activities |
|
|
|
|
|
|
||
Repayments of indebtedness |
|
|
( |
) |
|
|
( |
) |
Repayments of financing lease obligations |
|
|
( |
) |
|
|
( |
) |
Proceeds from exercise of stock options |
|
|
|
|
|
|
||
Payments of debt issuance costs |
|
|
( |
) |
|
|
|
|
Net cash used in financing activities |
|
|
( |
) |
|
|
( |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
|
( |
) |
|
|
|
|
Net increase in cash, cash equivalents and restricted cash |
|
|
|
|
|
|
||
Cash, cash equivalents and restricted cash at beginning of period |
|
|
|
|
|
|
||
Cash, cash equivalents and restricted cash at end of period |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Reconciliation of cash, cash equivalents and restricted cash: |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Restricted cash |
|
|
|
|
|
|
||
Total cash, cash equivalents and restricted cash |
|
$ |
|
|
$ |
|
||
See notes to the unaudited condensed consolidated financial statements.
10
E2open Parent Holdings, Inc.
Notes to the Unaudited Condensed Consolidated Financial Statements
1. Organization and Basis of Presentation
Organization and Description of Business
CC Neuberger Principal Holdings I (CCNB1) was a blank check company incorporated in the Cayman Islands on January 14, 2020 for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. CCNB1's sponsor was CC Neuberger Principal Holdings I Sponsor LLC, a Delaware limited liability company (Sponsor). CCNB1 became a public company on April 28, 2020 through an initial public offering.
On February 4, 2021 (Closing Date), CCNB1 and E2open Holdings, LLC and its operating subsidiaries (E2open Holdings) completed a business combination (Business Combination) contemplated by the definitive Business Combination Agreement entered into on October 14, 2020 (Business Combination Agreement). The Business Combination was accounted for as a business combination under ASC 805, Business Combination (ASC 805), and due to the change in control, was accounted for using the acquisition method with CCNB1 as the accounting acquirer and E2open Holdings as the accounting acquiree.
In connection with the finalization of the Business Combination, CCNB1 changed its name to "E2open Parent Holdings, Inc." and changed its jurisdiction of incorporation from the Cayman Islands to the State of Delaware (Domestication). Immediately following the Domestication, various entities merged with and into E2open, with E2open as the surviving company. Additionally, E2open Holdings became a subsidiary of E2open with the equity interests of E2open Holdings held by E2open and existing owners of E2open Holdings. The existing owners of E2open Holdings are considered noncontrolling interests in the unaudited condensed consolidated financial statements.
We are headquartered in Addison, Texas. We are a world-class connected supply chain software platform that enables the largest companies to transform the way they make, move and sell goods and services. With the broadest cloud-native global platform purpose-built for the modern supply chains, we connect manufacturing, logistics, channel and distributing partners as one multi-enterprise network. Our software as a service (SaaS) platform anticipates disruptions and opportunities to help companies improve efficiency, reduce waste and operate sustainably.
Basis of Presentation
These unaudited interim condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Investments in other companies are carried at cost. All intercompany balances and transactions have been eliminated in consolidation. In the opinion of management, all adjustments (consisting of normal recurring accruals), considered necessary for a fair presentation have been included. The unaudited operating results for interim periods reported are not necessarily indicative of the results for the entire fiscal year. For further information, refer to the consolidated financial statements and notes thereto included in our 2025 Form 10-K.
Fiscal Year
Our fiscal year ends on the last day of February each year.
Use of Estimates
The preparation of our unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the unaudited condensed consolidated financial statements and the reported results of operations during the reporting period. Such management estimates include allowance for credit losses, goodwill and other long-lived assets, estimates of standalone selling price of performance obligations for revenue contracts with multiple performance obligations, share-based compensation, valuation allowances for deferred tax assets and uncertain tax positions, tax receivable agreement liability, warrants, contingent consideration and contingencies. These estimates are based on information available as of the date of the unaudited condensed consolidated financial statements; therefore, actual results could differ from management's estimates.
11
Reclassifications
The current portion of the Tax Receivable Agreement liability has been reclassified from accounts payable and accrued liabilities to current portion of tax receivable agreement liability on the Condensed Consolidated Balance Sheets for all periods presented. See Note 10, Tax Receivable Agreement for additional information.
Seasonality
Our quarterly operating results have fluctuated in the past and are expected to fluctuate in the future due to a variety of factors, many of which are outside of our control, including seasonality in our business as a result of client budget cycles, with higher sales typically in the third and fourth fiscal quarters. As a result, our past results may not be indicative of our future performance and comparing our operating results on a period-to-period basis may not be meaningful.
2. Pending Corporate Transactions
On May 25, 2025, we entered into an Agreement and Plan of Merger (Merger Agreement) to be acquired by WiseTech Global Limited, an Australian public company limited by shares (WiseTech). Under the terms of the transaction, our stockholders will receive $
Effect on Capital Stock
At the closing of the transaction, each issued and outstanding share of Class A Common Stock, Series B-1 common stock, Series B-2 common stock, Common Units and Series 2 RCUs will be converted into the right to receive cash equal to $
Additionally, the outstanding warrants will automatically cease to represent a warrant exercisable for our Class A Common Stock and will become exercisable in exchange for Warrant Price, or $
Treatment of Company Equity Awards
At the closing of the transaction, each outstanding option with an exercise price less than $
Any restricted stock unit (RSU) that is vested but unsettled immediately prior to the closing of the transaction, is held by a non-employee board of director or advisory board member, vests in connection with the transaction or is held by an award holder whose aggregate unvested RSUs has a value of $
All other outstanding RSUs will be cancelled and exchanged for WiseTech restricted stock unit awards covering a number of ordinary shares equal to the product of the equity award ratio and the number of Class A Common Stock underlying the RSU with any resulting fractional shares rounded down to the nearest whole share. If WiseTech determines that converting the RSUs into WiseTech restricted stock unit awards is impracticable, such RSUs will instead be converted into the right to receive cash equal to $
For the performance-based RSUs, the revenue growth performance target will be deemed achieved at
At the time of the transaction, each performance-based RSU with a time-vesting component that accelerates, or each performance-based RSU with no time-vesting component, will be converted into the right to receive cash equal to $
12
Termination Rights and Termination Fees
The Merger Agreement between us and WiseTech contains certain customary termination rights including if the proposed merger is not completed on or before February 26, 2026 (Termination Date), unless WiseTech, under certain circumstances in its sole discretion, has extended the Termination Date to May 26, 2026. In the case of termination, we will be required to pay WiseTech a termination fee of $
Tax Receivable Agreement Amendment
The Tax Receivable Agreement was amended (TRA Amendment) in connection with the Merger Agreement. See Note 10, Tax Receivable Agreement for additional details. Under the TRA Amendment, the parties to the Tax Receivable Agreement will receive an aggregate of $
Closing Conditions and Status
The closing of the transaction is dependent upon and subject to several closing conditions, including:
Pursuant to the rules adopted by the SEC, we prepared and filed with the SEC on July 2, 2025, a Preliminary Information Statement on Schedule 14C containing more information about the Merger Agreement and proposed merger with WiseTech.
During the three months ended May 31, 2025 and 2024, we incurred expenses of $
The aggregate financial advisor fees associated with the transaction are not to exceed $
The transaction is expected to close by the end of calendar 2025.
3. Accounting Standards
Recent Accounting Standards Not Yet Adopted
In December 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-09, Income Taxes (Topic 740), Improvements to Income Tax Disclosures to enhance income tax information primarily through changes in the rate reconciliation and income taxes paid information. ASU 2023-09 also requires income (loss) from continuing operations before income taxes expense (benefit) to be separated between domestic and foreign and income tax expense (benefit) from continuing operations to be separated between federal, state and foreign. ASU 2023-09 is effective for annual periods beginning after December 15, 2024 on a prospective basis. Early adoption is permitted. We are currently evaluating the impact of this standard on our consolidated financial statements and related disclosures. We do not expect the adoption of this standard to have a material impact on our consolidated financial statements or disclosures.
13
In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses (DISE) which requires an entity to disclose, in the footnotes, information at each interim and annual reporting period information about expenses by the nature of the expense. Entities are required to include the following relevant expense captions: purchase of inventory, employee compensation, depreciation, intangible asset amortization and depreciation, depletion and amortization recognized as part of oil and gas producing activities. ASU 2024-03 is effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027 on a prospective basis with the option for retrospective application. Early adoption is permitted. We will be required to have additional disclosure, but we do not expect the adoption of this standard to have a material impact on our consolidated financial statements or disclosures.
4. Accounts Receivable
Accounts receivable, net consisted of the following:
($ in thousands) |
|
May 31, 2025 |
|
|
February 28, 2025 |
|
||
Accounts receivable |
|
$ |
|
|
$ |
|
||
Unbilled receivables |
|
|
|
|
|
|
||
Less: Allowance for credit losses |
|
|
( |
) |
|
|
( |
) |
Accounts receivable, net |
|
$ |
|
|
$ |
|
||
Unbilled receivables represent revenue recognized for performance obligations that have been satisfied but for which amounts have not been billed, which we also refer to as contract assets.
Account balances are written off against the allowance for credit losses when we believe that it is probable that the receivable balance will not be recovered.
5. Prepaid and Other Current Assets
Prepaid expenses and other current assets consisted of the following:
($ in thousands) |
|
May 31, 2025 |
|
|
February 28, 2025 |
|
||
Prepaid software and hardware license and maintenance fees |
|
$ |
|
|
$ |
|
||
Income and other taxes receivable |
|
|
|
|
|
|
||
Prepaid insurance |
|
|
|
|
|
|
||
Deferred commissions |
|
|
|
|
|
|
||
Prepaid marketing |
|
|
|
|
|
|
||
Security deposits |
|
|
|
|
|
|
||
Other prepaid expenses and other current assets |
|
|
|
|
|
|
||
Total prepaid expenses and other current assets |
|
$ |
|
|
$ |
|
||
Amortization of software licenses held under financing leases is included in cost of revenue and operating expenses. Prepaid maintenance, services and insurance are expensed over the term of the underlying agreements.
6. Goodwill
We test goodwill for impairment on an annual basis, during the fourth quarter, or whenever events or changes occur that would more-likely-than-not reduce the fair value of a reporting unit below its carrying value between annual impairment tests. As we have only
During the third and fourth quarters of fiscal 2025, we experienced a significant decline in the market price of our Class A Common Stock and market capitalization. In addition, in the third quarter of fiscal 2025, we experienced slowing growth and lowered projections due to lower than anticipated new bookings, lower revenue, higher than expected churn and macroeconomic impacts. These factors resulted in us determining that triggering events occurred, and goodwill impairment assessments were performed for the respective quarters.
14
During fiscal 2025, the fair value of E2open was calculated using a combination of the discounted cash flow method, guideline public company method and guideline transaction method. The discounted cash flow method was based on the present value of estimated future cash flows which were based on management's estimates of projected net sales, net operating income margins and terminal growth rates, taking into consideration market and industry conditions. The discount rate used was based on the weighted-average cost of capital adjusted for the risk, size premium and business-specific characteristics related to projected cash flows. Under the guideline public company method, the fair value was based on our current and forward-looking earnings multiples using management's estimates of projected net sales and adjusted EBITDA margins with consideration of market premiums. The unobservable inputs used to measure the fair value included projected net sales, forecasted adjusted EBITDA margins, weighted average cost of capital, normalized working capital levels, capital expenditures assumptions, profitability projections, determination of appropriate market comparison companies and terminal growth rates. Under the guideline transaction method, the fair value was based on pricing multiples derived from recently sold companies with similar characteristics to E2open taking into consideration management's estimate of projected net sales and net operating income margins.
In each impairment, these approaches generated similar results and indicated that the fair value of E2open's goodwill was less than its carrying amounts. Therefore, during the fiscal year ended February 28, 2025, we recognized an impairment charge of $
The following table presents the changes in goodwill:
($ in thousands) |
|
Amount |
|
|
Balance, February 29, 2024 |
|
$ |
|
|
Impairment charge |
|
|
( |
) |
Currency translation adjustment |
|
|
( |
) |
Balance, February 28, 2025 |
|
|
|
|
Currency translation adjustment |
|
|
|
|
Balance, May 31, 2025 |
|
$ |
|
|
7. Intangible Assets, Net
We test our indefinite-lived intangible asset for impairment on an annual basis or whenever events or changes occur that would more-likely-than not reduce the fair value of the indefinite-lived intangible asset below its carrying value between annual impairment tests. As we have only one reporting unit, any indefinite-lived intangible asset assessment is performed at the Company level.
During the third and fourth quarters of fiscal 2025, we experienced a significant decline in the market price of our Class A Common Stock and market capitalization. In addition, in the third quarter of fiscal 2025, we experienced slowing growth and lowered projections due to lower than anticipated net bookings, lower revenue, higher than expected churn and macroeconomic impacts. These factors resulted in us determining that triggering events occurred, and indefinite-lived intangible asset impairment assessments were performed for the respective quarters.
The fair value of the indefinite-lived intangible asset was calculated using the relief from royalty payments method which is based on management's estimates of projected net sales and terminal growth rates, taking into consideration market and industry conditions. The royalty rate used was based on royalty rates of companies with similar characteristics to E2open. The discount rate used was based on the weighted-average cost of capital adjusted for the risk, size premium and business-specific characteristics related to projected net sales.
The assessments indicated that the fair value of our indefinite-lived intangible asset was less than its carrying amount; therefore, during the fiscal year ended February 28, 2025, we recognized an impairment charge of $
15
Intangible assets, net consisted of the following:
|
|
May 31, 2025 |
|
|||||||||||
($ in thousands) |
|
Weighted Average |
|
Cost |
|
|
Accumulated |
|
|
Net |
|
|||
Indefinite-lived: |
|
|
|
|
|
|
|
|
|
|
|
|||
Trademark / Trade name |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
|||
Definite-lived: |
|
|
|
|
|
|
|
|
|
|
|
|||
Client relationships |
|
|
|
|
|
|
( |
) |
|
|
|
|||
Technology |
|
|
|
|
|
|
( |
) |
|
|
|
|||
Content library |
|
|
|
|
|
|
( |
) |
|
|
|
|||
Trade name |
|
|
|
|
|
|
( |
) |
|
|
— |
|
||
Total definite-lived |
|
|
|
|
|
|
|
( |
) |
|
|
|
||
Total intangible assets |
|
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
|
|
February 28, 2025 |
|
|||||||||||
($ in thousands) |
|
Weighted Average |
|
Cost |
|
|
Accumulated |
|
|
Net |
|
|||
Indefinite-lived: |
|
|
|
|
|
|
|
|
|
|
|
|||
Trademark / Trade name |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
|||
Definite-lived: |
|
|
|
|
|
|
|
|
|
|
|
|||
Client relationships |
|
|
|
|
|
|
( |
) |
|
|
|
|||
Technology |
|
|
|
|
|
|
( |
) |
|
|
|
|||
Content library |
|
|
|
|
|
|
( |
) |
|
|
|
|||
Trade name |
|
|
|
|
|
|
( |
) |
|
|
— |
|
||
Backlog |
|
|
|
|
|
|
( |
) |
|
|
— |
|
||
Total definite-lived |
|
|
|
|
|
|
|
( |
) |
|
|
|
||
Total intangible assets |
|
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
The e2open trade name and various trademarks are indefinite-lived. Acquired trade names are definite-lived as over time we rebrand acquired products and services as e2open.
Amortization of intangible assets is recorded in cost of revenue and operating expenses in the Unaudited Condensed Consolidated Statements of Operations. We recorded amortization expense related to intangible assets of $
Future amortization of intangible assets is as follows as of May 31, 2025:
($ in thousands) |
|
Amount |
|
|
June 1, 2025 through February 28, 2026 |
|
$ |
|
|
2027 |
|
|
|
|
2028 |
|
|
|
|
2029 |
|
|
|
|
2030 |
|
|
|
|
Thereafter |
|
|
|
|
Total future amortization |
|
$ |
|
|
16
8. Property and Equipment, Net
Property and equipment, net consisted of the following:
($ in thousands) |
|
May 31, 2025 |
|
|
February 28, 2025 |
|
||
Computer equipment |
|
$ |
|
|
$ |
|
||
Software |
|
|
|
|
|
|
||
Software development costs |
|
|
|
|
|
|
||
Furniture and fixtures |
|
|
|
|
|
|
||
Leasehold improvements |
|
|
|
|
|
|
||
Gross property and equipment |
|
|
|
|
|
|
||
Less accumulated depreciation and amortization |
|
|
( |
) |
|
|
( |
) |
Property and equipment, net |
|
$ |
|
|
$ |
|
||
Computer equipment and software include assets held under financing leases. Amortization of assets held under financing leases is included in depreciation expense. See Note 21, Leases for additional information regarding our financing leases.
Depreciation expense was $
Unamortized software development costs were $
We recognized $
Property and equipment, net by geographic regions consisted of the following:
($ in thousands) |
|
May 31, 2025 |
|
|
February 28, 2025 |
|
||
Americas |
|
$ |
|
|
$ |
|
||
Europe |
|
|
|
|
|
|
||
Asia Pacific |
|
|
|
|
|
|
||
Property and equipment, net |
|
$ |
|
|
$ |
|
||
No material gains or losses on disposal of property and equipment were recorded during the three months ended May 31, 2025 and 2024.
9. Accounts Payable and Accrued Liabilities
Accounts payable and accrued liabilities consisted of the following:
($ in thousands) |
|
May 31, 2025 |
|
|
February 28, 2025 |
|
||
Accrued compensation |
|
$ |
|
|
$ |
|
||
Trade accounts payable |
|
|
|
|
|
|
||
Accrued professional services |
|
|
|
|
|
|
||
Client deposits |
|
|
|
|
|
|
||
Accrued severance and retention |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
Total accounts payable and accrued liabilities |
|
$ |
|
|
$ |
|
||
10. Tax Receivable Agreement
On May 25, 2025, the TRA Amendment was signed in connection with the Merger Agreement with WiseTech. Under the TRA Amendment, the parties to the Tax Receivable Agreement will receive an aggregate of $
17
Prior to the TRA Amendment, significant inputs and assumptions were used to estimate the future expected payments including the timing of the realization of the tax benefits, an effective tax rate and an imputed interest rate based on our cost of debt plus an incremental premium. Changes in any of these or other factors were expected to impact the timing and amount of gross payments under the original Tax Receivable Agreement. The fair value of these obligations was accreted to the amount of the gross expected obligation.
Under the original Tax Receivable Agreement, the contractual early termination cash payment would be equal to the present value of the assumed future realized tax benefits based on a set of assumptions and using an agreed upon discount rate, as defined in the original Tax Receivable Agreement. The early termination payment may be made significantly in advance of the actual realization, if any, of those future tax benefits. Such payments would be calculated based on certain assumptions, including that E2open Holdings has sufficient taxable income to utilize the full amount of any tax benefits subject to the original Tax Receivable Agreement over the period specified therein. The payments that E2open Holdings would be required to make would generally reduce the amount of the overall cash flow that might have otherwise been available, but we would expect the cash tax savings it would realize from the utilization of the related tax benefits to exceed the amount of any required payments. However, we expect the transaction with WiseTech to close by the end of calendar year 2025 and the Tax Receivable Agreement to be settled under the terms of the TRA Amendment for $
The Tax Receivable Agreement liability was $
As of May 31, 2025, the Tax Receivable Agreement liability was determined based on the negotiated amount in the TRA Amendment. As such, we updated our estimate of the liability resulting in a $
Calculations of the Tax Receivable Agreement liability prior to May 31, 2025 used our tax rate and a discount rate which was based on the cost of debt plus an incremental premium. The tax rate used in the calculation was
The liability recorded on the balance sheet as of May 31, 2025 and February 28, 2025 does not include an estimate of the amount of payments to be made if certain sellers exchanged their remaining interests in E2open Holdings for our common stock, as this amount is dependent on several future variables, including timing of future exchanges, stock price at date of exchange, tax attributes of the individual parties to the exchange and changes in future applicable federal and state tax rates. The TRA Amendment would result in such an exchange upon closing the transaction with WiseTech and a $
During the three months ended May 31, 2025 and 2024, we did
We are entitled to receive quarterly tax distributions from E2open Holdings, subject to limitations imposed by applicable law and contractual restrictions. The cash received from such distributions will first be used to satisfy any tax liability and then make any payments required under the Tax Receivable Agreement.
18
11. Notes Payable
Notes payable outstanding were as follows:
($ in thousands) |
|
May 31, 2025 |
|
|
February 28, 2025 |
|
||
2021 Term Loan |
|
$ |
|
|
$ |
|
||
Other notes payable |
|
|
|
|
|
|
||
Total notes payable |
|
|
|
|
|
|
||
Less unamortized debt issuance costs |
|
|
( |
) |
|
|
( |
) |
Total notes payable, net |
|
|
|
|
|
|
||
Less current portion |
|
|
( |
) |
|
|
( |
) |
Notes payable, less current portion, net |
|
$ |
|
|
$ |
|
||
2021 Term Loan and Revolving Credit Facility
In February 2021, E2open, LLC, our subsidiary, entered into a credit agreement (Credit Agreement) that provided for $
On April 18, 2025, E2open, LLC signed an amendment to the Credit Agreement to extend the maturity date of the 2021 Revolving Credit Facility to
E2open, LLC can request increases in the revolving commitments and additional term loan facilities, in minimum amounts of $
The Credit Agreement is guaranteed by E2open Intermediate, LLC, our subsidiary, and certain wholly owned subsidiaries of E2open, LLC, as guarantors, and is supported by a security interest in substantially all of the guarantors' personal property and assets. The Credit Agreement contains certain customary events of default, representations and warranties as well as affirmative and negative covenants.
As of May 31, 2025 and February 28, 2025, there were $
We were in compliance with the First Lien Leverage Ratio for the Credit Agreement as of May 31, 2025 and February 28, 2025.
Beginning in March 2023, we entered into zero-cost interest rate collars in the notional amount of $
During the three months ended May 31, 2025 and 2024, we recognized $
19
12. Contingent Consideration
Business Combination
The contingent consideration liability is due to the issuance of Series B-2 common stock and Series 2 RCUs of E2open Holdings as part of the Business Combination. These shares and units were issued on a proportional basis to each holder of Class A shares in CCNB1 and Common Units of E2open Holdings. These restricted shares and Common Units are treated as a contingent consideration liability under ASC 805 and valued at fair market value. The contingent consideration liability was recorded at fair value on the acquisition date and is remeasured at each reporting date and adjusted if necessary. Any gain or loss recognized from the remeasurement is recorded in gain (loss) from the change in fair value of contingent consideration on the Unaudited Condensed Consolidated Statements of Operations as nonoperating income (expense) as the change in fair value is not part of our core operating activities.
The contingent consideration liability was $
There were
There were
Upon the conversion of an RCU, the holder of such RCU will be entitled to receive a payment equal to the amount of ordinary distributions paid on an E2open Holdings unit from the Closing Date through (but not including) the date such RCU converts into an E2open Holdings unit. If any of the RCUs do not vest on or before the
We have not paid any dividends to date and do not expect to in the future.
See Note 2, Pending Corporate Transactions for how the pending merger with WiseTech will affect the Series B-2 common stock and Series 2 RCUs.
13. Fair Value Measurement
Our financial instruments include cash and cash equivalents; investments; accounts receivable, net; notes receivable, accounts payable; notes payable; and financing lease obligations. Accounts receivable, net, notes receivable and accounts payable are stated at their carrying value, which approximates fair value, due to their short maturity. We measure our cash equivalents and investments at fair value, based on an exchange or exit price which represents the amount that would be received for an asset sale or an exit price, or paid to transfer a liability in an orderly transaction between knowledgeable and willing market participants. Certificates of deposit are valued at original cost plus accrued interest, which approximates fair value. We estimate the fair value for notes payable and financing lease obligations by discounting the future cash flows of the related note and lease payments. As of May 31, 2025 and February 28, 2025, the fair value of the cash and cash equivalents, restricted cash, certificates of deposit, notes payable and financing lease obligations approximates their recorded values.
20
The following tables set forth details about our investments:
($ in thousands) |
|
Cost |
|
|
Gross |
|
|
Gross |
|
|
Fair Value |
|
||||
May 31, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Asset-backed securities |
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
February 28, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Asset-backed securities |
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
|||
The asset-backed securities are included in other noncurrent assets on the Condensed Consolidated Balance Sheets.
Observable inputs are based on market data obtained from independent sources. Unobservable inputs reflect our assessment of the assumptions market participants would use to value certain financial instruments. This hierarchy requires us to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value.
Our assets and liabilities that are measured at fair value on a recurring basis, by level, within the fair value hierarchy are summarized as follows:
|
|
May 31, 2025 |
|
|||||||||||||
($ in thousands) |
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Investments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Asset-backed securities |
|
$ |
— |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
||
Total investments |
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other assets: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate collar agreements |
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
||
Total other assets |
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
||
Total assets |
|
$ |
— |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate collar agreements |
|
$ |
— |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
||
Cash-settled restricted stock units |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Tax receivable agreement liability |
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
||
Warrant liability |
|
|
|
|
|
— |
|
|
|
|
|
|
|
|||
Contingent consideration |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
||
Total liabilities |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
February 28, 2025 |
|
|||||||||||||
($ in thousands) |
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Investments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Asset-backed securities |
|
$ |
— |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
||
Total investments |
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total assets |
|
$ |
— |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate collar agreements |
|
$ |
— |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
||
Cash-settled stock units |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Tax receivable agreement liability |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
||
Warrant liability |
|
|
|
|
|
— |
|
|
|
|
|
|
|
|||
Contingent consideration |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
||
Total liabilities |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
21
Cash-Settled Restricted Stock Units
Cash-settled RSUs form part of our compensation program. The fair value of these awards is determined using the closing stock price of our Class A Common Stock on the last day of each balance sheet date which is considered an observable quoted market price in active markets (Level 1).
Contingent Consideration
The following table provides a reconciliation of the beginning and ending balances of the contingent consideration using significant unobservable inputs (Level 3):
($ in thousands) |
|
May 31, 2025 |
|
|
February 28, 2025 |
|
||
Beginning of period |
|
$ |
|
|
$ |
|
||
Loss (gain) from fair value of contingent consideration |
|
|
|
|
|
( |
) |
|
End of period |
|
$ |
|
|
$ |
|
||
The change in the fair value of the contingent consideration is recorded in gain (loss) from change in fair value of contingent consideration in the Unaudited Condensed Consolidated Statements of Operations.
Tax Receivable Agreement
Our Tax Receivable Agreement liability was measured under both ASC 805 at fair value on a recurring basis using significant unobservable inputs (Level 3) and ASC 450. As of May 31, 2025, the Tax Receivable Agreement liability is estimated considering an exit price from the TRA Amendment, which is an observable input (Level 2); therefore; the portion of the Tax Receivable Agreement that was previously measured under ASC 805 was transferred from Level 3 to Level 2 during the three months ended May 31, 2025.
The following table provides a reconciliation of the portion of the tax receivable agreement liability measured at fair value under Level 3:
($ in thousands) |
|
May 31, 2025 |
|
|
February 28, 2025 |
|
||
Beginning of period |
|
$ |
|
|
$ |
|
||
Payments |
|
|
|
|
|
( |
) |
|
Gain from fair value of tax receivable agreement liability |
|
|
|
|
|
( |
) |
|
Transfer out of Level 3 |
|
|
( |
) |
|
|
|
|
End of period |
|
$ |
|
|
$ |
|
||
The change in the fair value of the Tax Receivable Agreement liability is recorded in gain (loss) from change in tax receivable agreement liability in the Unaudited Condensed Consolidated Statements of Operations.
Warrants
Our warrant liability is measured at fair value on a recurring basis using active market quoted prices (Level 1) and significant unobservable inputs (Level 3).
($ in thousands) |
|
May 31, 2025 |
|
|
February 28, 2025 |
|
||
Beginning of period |
|
$ |
|
|
$ |
|
||
Gain from fair value of warrant liability |
|
|
( |
) |
|
|
( |
) |
End of period |
|
$ |
|
|
$ |
|
||
The change in the fair value of the warrant liability is recorded in gain from change in fair value of warrant liability in the Unaudited Condensed Consolidated Statements of Operations.
The fair values of our Level 1 financial instruments, which are traded in active markets, are based on quoted market prices for identical instruments. The fair values of our Level 2 financial instruments are based on daily market foreign currency rates, interest rate curves and quoted market prices for comparable instruments or model-driven valuations using observable market data or inputs corroborated by observable market data.
22
Our contingent consideration is valued using a Monte Carlo simulation model. The assumptions used in preparing this model include estimates such as volatility, contractual terms, discount rates, dividend yield and risk-free interest rates. This valuation model uses unobservable market input, and therefore the liability is classified as Level 3.
Our public warrants are valued using active market quoted prices, which are Level 1 inputs. The private placement warrants are valued using a binomial pricing model when the warrants are subject to the make-whole table, or otherwise are valued using a Black-Scholes pricing model. The
14. Revenue
We generate revenue from the sale of subscriptions and professional services. We recognize revenue when the client contract and associated performance obligations have been identified, transaction price has been determined and allocated to the performance obligations in the contract, and performance obligations have been satisfied. We recognize revenue net of any taxes collected from clients, which are subsequently remitted to governmental authorities. Other revenue is recognized when the service is delivered to the client.
Total Revenue by Geographic Locations
Revenue by geographic regions consisted of the following:
|
|
Three Months Ended May 31, |
|
|||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
||
Americas |
|
$ |
|
|
$ |
|
||
Europe |
|
|
|
|
|
|
||
Asia Pacific |
|
|
|
|
|
|
||
Total revenue |
|
$ |
|
|
$ |
|
||
Revenues by geography are determined based on the region of our contracting entity, which may be different than the region of the client. Americas revenue attributed to the United States was
Remaining Performance Obligations
Revenue allocated to remaining performance obligations represents the transaction price allocated to the performance obligations that are unsatisfied, or partially unsatisfied. It includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods and does not include contracts where the client is not committed. The client is not considered committed when they are able to terminate for convenience without payment of a substantive penalty under the contract. Additionally, as a practical expedient of ASC 606, Revenue from Contracts with Customers (ASC 606), we have not disclosed the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. As of May 31, 2025 and February 28, 2025, approximately $
Contract Assets and Liabilities
Contract assets primarily represent revenues recognized for performance obligations that have been satisfied but for which amounts have not been billed. Contract assets were $
23
Sales Commissions
With the adoption of ASC 606 and ASC 340-40, Contracts with Customers, in March 2019, we began deferring and amortizing sales commissions that are incremental and directly related to obtaining client contracts. Amortization expense of $
15. Warrants
As of May 31, 2025 and February 28, 2025, there were an aggregate of
On March 24, 2025, the staff of the NYSE Regulation determined to commence proceedings to delist our warrants, ticker symbol "ETWO-WT," from trading on the NYSE pursuant to Section 802.01D of the Listed Company Manual due to minimum trading price requirements and trading of these warrants was immediately suspended. As of March 25, 2025, our warrants began trading on the OTC Markets under the ticker symbol OTC:ETWOW. As a result, any over-the-counter market quotes reflect inter-dealer prices without retail mark-ups, mark-downs or commissions and may not represent actual transactions.
See Note 2, Pending Corporate Transactions for how the pending merger with WiseTech will affect the warrants.
16. Stockholders' Equity
Class A Common Stock
We are authorized to issue
Class V Common Stock
We are authorized to issue
The holders of Common Units participate in net income or loss allocations and distributions of E2open Holdings. They are also entitled to Class V Common Stock
24
The following table reflects the changes in our outstanding stock:
|
|
Class A |
|
|
Class V |
|
|
Series B-1 |
|
|
Series B-2 |
|
||||
Balance, February 29, 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Conversion of Common Units (1) |
|
|
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
Issuance of common stock upon exercise of options |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Vesting of restricted awards, net of shares |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Balance, February 28, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Vesting of restricted awards, net of shares |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Balance, May 31, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
See Note 2, Pending Corporate Transactions for how the pending merger with WiseTech will affect the common stock.
17. Noncontrolling Interest
Noncontrolling interest represents the portion of E2open Holdings that we control and consolidate but do not own. As of May 31, 2025 and February 28, 2025, the noncontrolling interest represents an
Generally, Common Units participate in net income or loss allocations and distributions and entitle their holder to the right, subject to the terms set forth in the Third Amended and Restated Limited Liability Company Agreement of E2open, LLC (Third Company Agreement), to require E2open Holdings to redeem all or a portion of the Common Units held by such participant. At our option, we may satisfy this redemption with cash or by exchanging Class V Common Stock for Class A Common Stock on a
During the three months ended May 31, 2025, there were
As of May 31, 2025 and February 28, 2025, there were a total of
We follow the guidance issued by the FASB regarding the classification and measurement of redeemable securities. Accordingly, we have determined that the Common Units meet the requirements to be classified as permanent equity.
See Note 2, Pending Corporate Transactions for how the pending merger with WiseTech will affect the Common Units.
25
18. Other Comprehensive Loss
Accumulated other comprehensive loss in the equity section of our Condensed Consolidated Balance Sheets includes:
($ in thousands) |
|
Foreign Currency Translation Adjustment |
|
|
Unrealized Holding Gains (Losses) on Foreign Exchange Forward Contracts |
|
|
Unrealized Holding Gains (Losses) on Interest Rate Collar Agreements |
|
|
Total |
|
||||
Balance, February 29, 2024 |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other comprehensive loss |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Tax effects |
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
Other comprehensive loss |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Balance, February 28, 2025 |
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other comprehensive income |
|
|
|
|
|
— |
|
|
|
|
|
|
|
|||
Tax effects |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Other comprehensive income |
|
|
|
|
|
— |
|
|
|
|
|
|
|
|||
Balance, May 31, 2025 |
|
$ |
( |
) |
|
$ |
— |
|
|
$ |
|
|
$ |
( |
) |
|
There were
The effect of amounts reclassified out of unrealized holding losses on derivatives into net loss was as follows:
|
|
Three Months Ended |
|
|
($ in thousands) |
|
May 31, 2024 |
|
|
Reclassifications: |
|
|
|
|
Cost of revenue |
|
$ |
|
|
Research and development |
|
|
|
|
General and administrative |
|
|
|
|
Total |
|
$ |
|
|
There were
The effect of amounts reclassified out of unrealized gains (losses) for interest rate collars as an offset to interest expense was as follows:
|
|
Three Months Ended May 31, |
|
|||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
||
Reclassifications: |
|
|
|
|
|
|
||
$ |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
|
|
|
( |
) |
|
Total |
|
$ |
|
|
$ |
( |
) |
|
Accumulated foreign currency translation adjustments are reclassified to net loss when realized upon sale or upon complete, or substantially complete, liquidation of the investment in the foreign entity.
26
19. Earnings Per Share
Basic earnings per share is calculated as net loss available to common stockholders divided by the weighted average number of shares of common stock outstanding during the applicable period. Diluted earnings per share is computed by using the basic earnings per share plus any dilutive securities outstanding during the period using the if-converted method, except when the effect is anti-dilutive.
|
|
Three Months Ended May 31, |
|
|||||
(in thousands, except per share data) |
|
2025 |
|
|
2024 |
|
||
Net loss per share: |
|
|
|
|
|
|
||
Numerator - basic: |
|
|
|
|
|
|
||
Net loss |
|
$ |
( |
) |
|
$ |
( |
) |
Less: Net loss attributable to noncontrolling interest |
|
|
( |
) |
|
|
( |
) |
Net loss attributable to E2open Parent Holdings, Inc. - basic |
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
||
Numerator - diluted: |
|
|
|
|
|
|
||
Net loss attributable to E2open Parent Holdings, Inc. - basic |
|
$ |
( |
) |
|
$ |
( |
) |
Net loss attributable to E2open Parent Holdings, Inc. - diluted |
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
||
Denominator - basic: |
|
|
|
|
|
|
||
Weighted average shares outstanding - basic |
|
|
|
|
|
|
||
Net loss per share - basic |
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
||
Denominator - diluted: |
|
|
|
|
|
|
||
Weighted average shares outstanding - basic |
|
|
|
|
|
|
||
Weighted average shares outstanding - diluted |
|
|
|
|
|
|
||
Diluted net loss per common share |
|
$ |
( |
) |
|
$ |
( |
) |
Potential common shares are shares that would be issued upon exercise or conversion of shares under our share-based compensation plans and upon exercise of warrants that are excluded from the computation of diluted earnings per common share when the effect would be anti-dilutive. All potential common shares are anti-dilutive in periods of net loss available to common stockholders.
The following table summarizes the potential common shares excluded from the calculation of diluted loss per common share as their effect would be anti-dilutive:
|
|
Three Months Ended May 31, |
|
|||||
|
|
2025 |
|
|
2024 |
|
||
Series B-1 common stock |
|
|
|
|
|
|
||
Series B-2 common stock |
|
|
|
|
|
|
||
Restricted common units Series 2 |
|
|
|
|
|
|
||
Warrants |
|
|
|
|
|
|
||
Common Units |
|
|
|
|
|
|
||
Performance-based options |
|
|
|
|
|
|
||
Time-based options |
|
|
|
|
|
|
||
Performance-based restricted stock units |
|
|
|
|
|
|
||
Time-based restricted stock units |
|
|
|
|
|
|
||
Units/Shares excluded from the dilution computation |
|
|
|
|
|
|
||
27
20. Share-Based Compensation
2021 Incentive Plan
The E2open Parent Holdings, Inc. 2021 Omnibus Incentive Plan, as Amended and Restated (2021 Incentive Plan), allows us to make equity and equity-based incentive awards to officers, employees, directors and consultants. There were
The following table presents the awards granted for Class A Common Stock:
|
|
Three Months Ended May 31, |
|
|||||
|
|
2025 |
|
|
2024 |
|
||
Awards granted |
|
|
|
|
|
|
||
Options |
|
|
|
|
|
|
||
RSUs |
|
|
|
|
|
|
||
Total awards granted |
|
|
|
|
|
|
||
Options
Options are granted to our executive officers and senior management. These awards are recorded as equity awards within the Unaudited Condensed Consolidated Statements of Stockholders' Equity. There were no options granted during the three months ended May 31, 2025. For fiscal 2025, the only options granted were the two awards described below.
On March 7, 2024,
On January 7, 2025,
As of May 31, 2025, there were
RSUs
The RSUs are either performance-based or time-based. These awards are recorded as equity awards within the Unaudited Condensed Consolidated Statements of Stockholders' Equity. The fiscal 2026 performance-based RSUs are measured on achieving positive subscription revenue growth on a constant currency basis for four consecutive quarters from March 1, 2025 through February 28, 2028. At the time this metric is achieved, the award will vest in full. If the metric is not achieved, the award will be forfeited.
The fiscal 2025 performance-based RSUs are measured based on obtaining an organic subscription revenue growth and constant currency adjusted EBITDA targets over a
The time-based RSUs for executive officers, senior management and employees granted during fiscal 2022 and 2023 vest ratably over a
28
On December 20, 2024,
As of May 31, 2025, there were
Redeemable Share-Based Awards
If there is a change in control, the award will immediately vest under the performance condition based upon the appropriate stock hurdle and automatically time-vest. The vested RSU will be paid in the form of cash and/or equity in a ratio substantially similar to the ratio received by the other shareholders in connection with the change in control. Additionally, the cash portion of the award will be equal to at least
Mr. Appel was also awarded time-based RSUs that vest one-third after the first year and vest ratably each quarter over the remaining two-years. If there is a change in control, the award will immediately vest and be paid in the form of cash and/or equity in a ratio substantially similar to the ratio received by the other shareholders in connection with the change in control. Additionally, the cash portion of the award will be equal to at least
The amount presented in the mezzanine as redeemable share-based awards will be the redemption amount as of the grant date, multiplied by the portion of the requisite service period that has elapsed. The redemption amount is based on the number of shares that would vest if a change in control occurred at the grant date multiplied by the grant date stock price. Once the RSUs have vested, the associated redemption value will be reclassified from the redeemable share-based award to additional paid-in capital on the Condensed Consolidated Balance Sheets.
Liability Awards
For employees based in China, they are awarded cash-settled RSUs. The cash-settled RSUs issued during fiscal 2023 vest ratably over a
As of May 31, 2025, there were
See Note 2, Pending Corporate Transactions for how the pending merger with WiseTech will affect the outstanding equity awards.
29
The table below sets forth the functional classification in the Unaudited Condensed Consolidated Statements of Operations of our equity-based compensation expense:
|
|
Three Months Ended May 31, |
|
|||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
||
Cost of revenue |
|
$ |
|
|
$ |
|
||
Research and development |
|
|
|
|
|
|
||
Sales and marketing |
|
|
|
|
|
|
||
General and administrative |
|
|
|
|
|
|
||
Total share-based compensation |
|
$ |
|
|
$ |
|
||
21. Leases
We account for leases in accordance with ASC 842, Leases (ASC 842), which requires lessees to recognize lease liabilities and right-of-use (ROU) assets on the balance sheet for most operating leases.
AG真人官方 Estate Leases
We lease our primary office space under non-cancelable operating leases with various expiration dates through
Several of the operating lease agreements require us to provide security deposits. As of May 31, 2025 and February 28, 2025, lease deposits were $
During the three months ended May 31, 2025, we incurred a $
Vehicle Leases
We lease vehicles under non-cancelable operating lease arrangements which have various expiration dates through
Equipment Leases
We purchase certain equipment under non-cancelable financing lease arrangements related to software and computer equipment which have various expiration dates through
Balance Sheet Presentation
The following tables present the amounts and classifications of our estimated ROU assets, net and lease liabilities:
($ in thousands) |
|
Balance Sheet Location |
|
May 31, 2025 |
|
|
February 28, 2025 |
|
||
Operating lease right-of-use assets |
|
Operating lease right-of-use assets |
|
$ |
|
|
$ |
|
||
Finance lease right-of-use asset |
|
Property and equipment, net |
|
|
|
|
|
|
||
Total right-of-use assets |
|
|
|
$ |
|
|
$ |
|
||
($ in thousands) |
|
Balance Sheet Location |
|
May 31, 2025 |
|
|
February 28, 2025 |
|
||
Operating lease liability - current |
|
Current portion of operating lease obligations |
|
$ |
|
|
$ |
|
||
Operating lease liability |
|
Operating lease obligations |
|
|
|
|
|
|
||
Finance lease liability - current |
|
Current portion of finance lease obligations |
|
|
|
|
|
|
||
Finance lease liability |
|
Finance lease obligations |
|
|
|
|
|
|
||
Total lease liabilities |
|
|
|
$ |
|
|
$ |
|
||
30
Lease Cost and Cash Flows
The following table summarizes our total lease cost:
|
|
Three Months Ended May 31, |
|
|||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
||
Finance lease cost: |
|
|
|
|
|
|
||
Amortization of right-of-use asset |
|
$ |
|
|
$ |
|
||
Interest on lease liability |
|
|
|
|
|
|
||
Finance lease cost |
|
|
|
|
|
|
||
Operating lease cost: |
|
|
|
|
|
|
||
Operating lease cost |
|
|
|
|
|
|
||
Variable lease cost |
|
|
|
|
|
|
||
Sublease income |
|
|
( |
) |
|
|
( |
) |
Operating net lease cost |
|
|
|
|
|
|
||
Total net lease cost |
|
$ |
|
|
$ |
|
||
Supplemental cash flow information related to leases was as follows:
|
|
Three Months Ended May 31, |
|
|||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
||
Cash paid for amounts included in the measurement of |
|
|
|
|
|
|
||
Operating cash outflows from operating leases |
|
$ |
|
|
$ |
|
||
The following table presents the weighted-average remaining lease terms and discount rates of our leases:
|
|
Three Months Ended May 31, |
|
|||||
|
|
2025 |
|
|
2024 |
|
||
Weighted-average remaining lease term (in years): |
|
|
|
|
|
|
||
Finance lease |
|
|
|
|
|
|
||
Operating lease |
|
|
|
|
|
|
||
Weighted-average discount rate: |
|
|
|
|
|
|
||
Finance lease |
|
|
% |
|
|
% |
||
Operating lease |
|
|
% |
|
|
% |
||
Lease Liability Maturity Analysis
The following table reflects the undiscounted future cash flows utilized in the calculation of the lease liabilities as of May 31, 2025:
($ in thousands) |
|
Operating Leases |
|
|
Finance Leases |
|
||
June 1, 2025 through February 28, 2026 |
|
$ |
|
|
$ |
|
||
2027 |
|
|
|
|
|
|
||
2028 |
|
|
|
|
|
|
||
2029 |
|
|
|
|
|
|
||
2030 |
|
|
|
|
|
|
||
Thereafter |
|
|
|
|
|
|
||
Total |
|
|
|
|
|
|
||
Less: Present value discount |
|
|
( |
) |
|
|
( |
) |
Lease liabilities |
|
$ |
|
|
$ |
|
||
22. Income Taxes
We calculate the provision for income taxes during interim periods by applying an estimate of the forecasted annual effective tax rate for the full fiscal year to ordinary income or loss (pretax income or loss excluding discrete items) for the reporting period. Our provision for income taxes was an expense of $
31
The loss before income taxes of $
As of May 31, 2025 and February 28, 2025, total gross unrecognized tax benefits were $
23. Segments
Our chief operating decision maker, the CODM, who is our CEO, manages the business, makes operating decisions and evaluates operating performance on a consolidated basis. We consist of
The CODM assesses performance based on revenue, cost of revenue and significant expense categories as reported in the Unaudited Condensed Consolidated Statements of Operations. Assets are measured based on total assets as reported on the Condensed Consolidated Balance Sheets. Total expenditures for additions to long-lived assets are reported as capital expenditures on the Unaudited Condensed Consolidated Statements of Cash Flows. The CODM uses revenue categories and cost of revenue excluding the amortization of acquired intangible assets as reported on the Unaudited Condensed Consolidated Statements of Operations to evaluate performance and allocate resources.
24. Commitments and Contingencies
Global Business Services Agreement
On December 27, 2024, we entered into a Master Service Agreement (MSA) with a third party which will provide certain global business services, transformation advisory services and digital solutions for us in an effort to drive long-term transformation and efficiencies for its internal processes. The term of the agreement is
Legal Proceedings
From time to time, we are subject to contingencies that arise in the ordinary course of business. We record an accrual for a contingency when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We do not currently believe the resolution of any other such contingencies will have a material adverse effect upon our Unaudited Condensed Consolidated Balance Sheets, Statements of Operations or Statements of Cash Flows.
32
25. Supplemental Cash Flow Information
Supplemental cash flow information and non-cash investing and financing activities are as follows:
|
|
Three Months Ended May 31, |
|
|||||
(In thousands) |
|
2025 |
|
|
2024 |
|
||
Supplemental cash flow information - Cash paid for: |
|
|
|
|
|
|
||
Interest |
|
$ |
|
|
$ |
|
||
Income taxes |
|
|
|
|
|
|
||
Non-cash investing and financing activities: |
|
|
|
|
|
|
||
Capital expenditures included in accounts payable and accrued liabilities |
|
|
|
|
|
|
||
Right-of-use assets obtained in exchange for operating lease obligations |
|
|
|
|
|
|
||
Shares withheld for taxes on vesting of restricted stock |
|
|
|
|
|
|
||
Conversion of Common Units to Class A Common Stock |
|
|
— |
|
|
|
|
|
Redeemable share-based awards |
|
|
|
|
|
|
||
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
This item contains a discussion of our business, including a general overview of our business, results of operations, liquidity and capital resources as well as quantitative and qualitative disclosures about market risk.
The following discussion should be read in conjunction with Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations of our 2025 Form 10-K and the unaudited condensed financial statements and related notes beginning on page 5. This Item 2 contains "forward-looking" statements that involve risks and uncertainties. See Forward-Looking Statements at the beginning of this Quarterly Report.
Overview
We are a world-class end-to-end supply chain software platform that enables the world's largest companies to transform the way they make, move and sell goods and services. Our SaaS platform spans many key strategic and operational areas including channel, planning, global trade, logistics and supply. With a cloud-native global SaaS platform purpose-built for modern supply chains, we connect manufacturing, logistics, channel and distributing partners as one multi-enterprise network. Our SaaS platform anticipates disruptions and opportunities to help companies improve efficiency, reduce waste and operate sustainably. In aggregate, we serve clients in all major countries in the world across a wide range of end-markets, including consumer goods, food and beverage, manufacturing, retail, industrial and automotive, aerospace and defense, technology and transportation, among others.
We operate in what we believe is an attractive industry with strong secular tailwinds and a total addressable market which includes significant whitespace within our current client base. This upsell opportunity within our existing client base is largely driven by their current technology solution, which is often a combination of legacy point solutions and home-grown applications which could be a combination of manual processes and spreadsheets. As manufacturing continues to evolve, supply chains have grown more complex, creating the need for a modern cloud-based solution. We believe our cloud-based, end-to-end software platform offers a differentiated and more connected solution for clients that provides all the mechanisms needed to run a fully integrated supply chain solution with visibility at every point. If our clients initially purchase portions of our software, they can add on additional modules as the need arises.
Recent Events
On May 25, 2025, we entered into the Merger Agreement to be acquired by WiseTech. Under the terms of the transaction, our stockholders will receive $3.30 per share in cash. The closing of the transaction is dependent upon and subject to customary closing conditions. See Pending Corporate Transactions below for additional information.
33
Results of Operations
The following table is our Unaudited Condensed Consolidated Statements of Operations for the periods indicated:
|
|
Three Months Ended May 31, |
|
|||||
($ in thousands, except per share amounts) |
|
2025 |
|
|
2024 |
|
||
Revenue |
|
$ |
152,610 |
|
|
$ |
151,163 |
|
Cost of revenue |
|
|
(79,019 |
) |
|
|
(78,503 |
) |
Total gross profit |
|
|
73,591 |
|
|
|
72,660 |
|
|
|
|
|
|
|
|
||
Operating Expenses |
|
|
|
|
|
|
||
Research and development |
|
|
23,354 |
|
|
|
24,797 |
|
Sales and marketing |
|
|
20,173 |
|
|
|
20,996 |
|
General and administrative |
|
|
21,415 |
|
|
|
23,343 |
|
Acquisition-related expenses |
|
|
5,485 |
|
|
|
283 |
|
Amortization of acquired intangible assets |
|
|
5,611 |
|
|
|
20,086 |
|
Total operating expenses |
|
|
76,038 |
|
|
|
89,505 |
|
Loss from operations |
|
|
(2,447 |
) |
|
|
(16,845 |
) |
Interest and other expense, net |
|
|
(20,054 |
) |
|
|
(25,373 |
) |
Gain (loss) from change in tax receivable agreement liability |
|
|
20,727 |
|
|
|
(3,974 |
) |
Gain from change in fair value of warrant liability |
|
|
479 |
|
|
|
3,761 |
|
Loss from change in fair value of contingent consideration |
|
|
(12,060 |
) |
|
|
(2,280 |
) |
Total other expense |
|
|
(10,908 |
) |
|
|
(27,866 |
) |
Loss before income tax provision |
|
|
(13,355 |
) |
|
|
(44,711 |
) |
Income tax (expense) benefit |
|
|
(2,168 |
) |
|
|
1,923 |
|
Net loss |
|
|
(15,523 |
) |
|
|
(42,788 |
) |
Less: Net loss attributable to noncontrolling interest |
|
|
(1,397 |
) |
|
|
(3,926 |
) |
Net loss attributable to E2open Parent Holdings, Inc. |
|
$ |
(14,126 |
) |
|
$ |
(38,862 |
) |
Net loss attributable to E2open Parent Holdings, Inc. |
|
|
|
|
|
|
||
Basic |
|
$ |
(0.05 |
) |
|
$ |
(0.13 |
) |
Diluted |
|
$ |
(0.05 |
) |
|
$ |
(0.13 |
) |
Weighted-average common shares outstanding: |
|
|
|
|
|
|
||
Basic |
|
|
310,513 |
|
|
|
306,732 |
|
Diluted |
|
|
310,513 |
|
|
|
306,732 |
|
Three Months Ended May 31, 2025 compared to Three Months Ended May 31, 2024
Revenue
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
|
|||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|
||||
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Subscriptions |
|
$ |
132,870 |
|
|
$ |
131,404 |
|
|
$ |
1,466 |
|
|
|
1 |
% |
Professional services and other |
|
|
19,740 |
|
|
|
19,759 |
|
|
|
(19 |
) |
|
|
0 |
% |
Total revenue |
|
$ |
152,610 |
|
|
$ |
151,163 |
|
|
$ |
1,447 |
|
|
|
1 |
% |
Percentage of revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Subscriptions |
|
|
87 |
% |
|
|
87 |
% |
|
|
|
|
|
|
||
Professional services and other |
|
|
13 |
% |
|
|
13 |
% |
|
|
|
|
|
|
||
Total |
|
|
100 |
% |
|
|
100 |
% |
|
|
|
|
|
|
||
Subscriptions revenue was $132.9 million for the three months ended May 31, 2025, a $1.5 million, or 1%, increase compared to subscriptions revenue of $131.4 million for the three months ended May 31, 2024. The increase in subscriptions revenue was primarily due to stabilization in churn and new bookings.
Professional services and other revenue were $19.7 million for the three months ended May 31, 2025 compared to $19.8 million for the three months ended May 31, 2024. Professional services and other revenue was flat during the periods.
34
Our subscriptions revenue as a percentage of total revenue was 87% for the first quarter of fiscal 2026 and 2025. Our professional services and other revenue as a percentage of total revenue was 13% for the first quarter of fiscal 2026 and 2025.
Cost of Revenue, Gross Profit and Gross Margin
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
|
|||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|
||||
Cost of revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Subscriptions |
|
$ |
38,385 |
|
|
$ |
37,099 |
|
|
$ |
1,286 |
|
|
|
3 |
% |
Professional services and other |
|
|
16,848 |
|
|
|
16,752 |
|
|
|
96 |
|
|
|
1 |
% |
Amortization of acquired intangible assets |
|
|
23,786 |
|
|
|
24,652 |
|
|
|
(866 |
) |
|
|
-4 |
% |
Total cost of revenue |
|
$ |
79,019 |
|
|
$ |
78,503 |
|
|
$ |
516 |
|
|
|
1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross profit: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Subscriptions |
|
$ |
70,699 |
|
|
$ |
69,653 |
|
|
$ |
1,046 |
|
|
|
2 |
% |
Professional services and other |
|
|
2,892 |
|
|
|
3,007 |
|
|
|
(115 |
) |
|
|
-4 |
% |
Total gross profit |
|
$ |
73,591 |
|
|
$ |
72,660 |
|
|
$ |
931 |
|
|
|
1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross margin: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Subscriptions |
|
|
53 |
% |
|
|
53 |
% |
|
|
|
|
|
|
||
Professional services and other |
|
|
15 |
% |
|
|
15 |
% |
|
|
|
|
|
|
||
Total gross margin |
|
|
48 |
% |
|
|
48 |
% |
|
|
|
|
|
|
||
Cost of subscriptions was $38.4 million for the three months ended May 31, 2025, a $1.3 million, or 3%, increase compared to $37.1 million for the three months ended May 31, 2024. This increase was primarily driven by a $1.7 million increase in personnel related costs and $1.1 million increase in software costs partially offset by a decrease of $1.2 million of depreciation expense when compared to the prior year.
Cost of professional services and other revenue was $16.8 million for the three months ended May 31, 2025 and 2024.
Amortization of acquired intangible assets was $23.8 million for the three months ended May 31, 2025 compared to $24.7 million for the three months ended May 31, 2024. The decrease in amortization expense was due to certain intangible assets being fully amortized.
Our subscriptions gross margin was 53% in the first quarter of fiscal 2026 and 2025.
Our professional services gross margin was 15% in the first quarter of fiscal 2026 and 2025.
Research and Development
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
|
|||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|
||||
Research and development |
|
$ |
23,354 |
|
|
$ |
24,797 |
|
|
$ |
(1,443 |
) |
|
|
-6 |
% |
Percentage of revenue |
|
|
15 |
% |
|
|
16 |
% |
|
|
|
|
|
|
||
Research and development expenses were $23.4 million for the three months ended May 31, 2025, a $1.4 million, or 6%, decrease compared to $24.8 million for the three months ended May 31, 2024. The decrease was mainly due to a $1.0 million decrease in personnel costs primarily due to an increased mix in offshore resources when compared to the prior year.
Sales and Marketing
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
|
|||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|
||||
Sales and marketing |
|
$ |
20,173 |
|
|
$ |
20,996 |
|
|
$ |
(823 |
) |
|
|
-4 |
% |
Percentage of revenue |
|
|
13 |
% |
|
|
14 |
% |
|
|
|
|
|
|
||
Sales and marketing expenses were $20.2 million for the three months ended May 31, 2025, an $0.8 million, or 4%, decrease compared to $21.0 million in the prior year. The decrease was driven by a decline in marketing and personnel costs partially offset by an increase in share-based compensation as compared to the prior year.
35
General and Administrative
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
|
|||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|
||||
General and administrative |
|
$ |
21,415 |
|
|
$ |
23,343 |
|
|
$ |
(1,928 |
) |
|
|
-8 |
% |
Percentage of revenue |
|
|
14 |
% |
|
|
15 |
% |
|
|
|
|
|
|
||
General and administrative expenses were $21.4 million for the three months ended May 31, 2025, a $1.9 million, or 8%, decrease compared to $23.3 million in the prior year. The decrease was the result of $1.4 million lower share-based compensation expense and $1.0 million lower personnel costs.
Other Operating Expenses
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
|
|||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|
||||
Acquisition and other related expenses |
|
$ |
5,485 |
|
|
$ |
283 |
|
|
$ |
5,202 |
|
|
nm |
|
|
Amortization of acquired intangible assets |
|
|
5,611 |
|
|
|
20,086 |
|
|
|
(14,475 |
) |
|
|
-72 |
% |
Total other operating expenses |
|
$ |
11,096 |
|
|
$ |
20,369 |
|
|
$ |
(9,273 |
) |
|
|
-46 |
% |
Acquisition and other related expenses were $5.5 million and $0.3 million for the three months ended May 31, 2025 and 2024, respectively. The increase in expenses was a result of our strategic alternatives review and the announced merger with WiseTech.
Amortization of acquired intangible assets was $5.6 million and $20.1 million for the first quarter of fiscal 2026 and 2025, respectively. The decrease in amortization expense was due to certain intangible assets being fully amortized.
Interest and Other Expense, Net
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
|
|||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|
||||
Interest and other expense, net |
|
$ |
(20,054 |
) |
|
$ |
(25,373 |
) |
|
$ |
5,319 |
|
|
|
-21 |
% |
Interest and other expense, net was $20.1 million for the three months ended May 31, 2025, a $5.3 million, or 21%, decrease compared to $25.4 million in the prior year. The decrease was driven by higher realized exchange gains and lower interest expense on our debt due to normal principal payments and lower interest rates in fiscal 2026 compared to fiscal 2025.
Gain (Loss) from Change in Tax Receivable Agreement
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|||
Gain (loss) from change in tax receivable |
|
$ |
20,727 |
|
|
$ |
(3,974 |
) |
|
$ |
24,701 |
|
|
nm |
During the three months ended May 31, 2025, we recorded a gain of $20.7 million related to the change in the fair value of the tax receivable agreement liability, including interest, compared to $4.0 million during the three months ended May 31, 2024. The Tax Receivable Agreement liability of May 31, 2025 was determined based on the negotiated amount in the TRA Amendment. The $20.7 million gain for the three months ended May 31, 2025 represented a $7.4 million gain related to the ASC 805 portion of the liability and a $13.3 million gain related to the portion of the liability accounted for under ASC 450. The $4.0 million loss for the three months ended May 31, 2024 represented the change in the ASC 805 portion of the liability.
Prior to May 31, 2025, we calculated the fair value of the Tax Receivable Agreement payments based on the expected timing of when tax attributes would be utilized. The Tax Receivable Agreement liability, related to exchanges as of the Business Combination date, has been revalued at the end of each reporting period with the gain or loss as well as the associated interest reflected in gain (loss) from change in tax receivable agreement liability in the Unaudited Condensed Consolidated Statements of Operations in the period in which the change occurred.
In addition, under ASC 450, transactions with partnership unit holders after the acquisition date have resulted in additional Tax Receivable Agreement liabilities. Prior to May 31, 2025, the ASC 450 portion of the Receivable Agreement liability was recorded on a gross undiscounted basis. During the three months ended May 31, 2024, the Tax Receivable Agreement applicable to this guidance increased by $0.5 million.
36
Gain from Change in Fair Value of Warrant Liability
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
|
|||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|
||||
Gain from change in fair value of warrant |
|
$ |
479 |
|
|
$ |
3,761 |
|
|
$ |
(3,282 |
) |
|
|
-87 |
% |
We recorded a gain of $0.5 million during the three months ended May 31, 2025, a $3.3 million decrease compared to $3.8 million in the prior year for the change in fair value on the revaluation of our warrant liability associated with our warrants. We are required to revalue the warrants at the end of each reporting period and reflect in the Unaudited Condensed Consolidated Statements of Operations a gain or loss from the change in fair value of the warrant liability in the period in which the change occurred.
Loss from Change in Fair Value of Contingent Consideration
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|||
Loss from change in fair value of contingent |
|
$ |
(12,060 |
) |
|
$ |
(2,280 |
) |
|
$ |
(9,780 |
) |
|
nm |
We recorded a loss of $12.1 million during the three months ended May 31, 2025, a $9.8 million increase compared to $2.3 million in the prior year for the change in fair value on the revaluation of our contingent consideration associated with our restricted B-2 common stock and Series 2 RCUs. We are required to revalue the contingent consideration at the end of each reporting period or upon conversion and reflect in the Unaudited Condensed Consolidated Statements of Operations a gain or loss from the change in fair value of the contingent consideration in the period in which the change occurred.
Income Tax Provision
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
|
|||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|
||||
Loss before income taxes |
|
$ |
(13,355 |
) |
|
$ |
(44,711 |
) |
|
$ |
31,356 |
|
|
|
-70 |
% |
Income tax (expense) benefit |
|
|
(2,168 |
) |
|
|
1,923 |
|
|
|
(4,091 |
) |
|
nm |
|
|
Income tax expense was $2.2 million, or 16.2%, for the three months ended May 31, 2025 compared to an income tax benefit of $1.9 million, or 4.3%, for the three months ended May 31, 2024. We have an income tax expense in the first quarter of fiscal 2026 due to higher deferred tax assets on entities that carry a valuation allowance as well as a projected Base Erosion and Anti-abuse (BEAT) liability.
Non-GAAP Financial Measures
This document includes Non-GAAP gross profit, Non-GAAP gross margin, EBITDA and Adjusted EBITDA, which are non-GAAP performance measures that we use to supplement our results presented in accordance with U.S. GAAP. We believe these non-GAAP measures are useful in evaluating our operating performance, as they are similar to measures reported by our public competitors and are regularly used by security analysts, institutional investors and other interested parties in analyzing operating performance and prospects. These non-GAAP measures are not intended to be a substitute for any U.S. GAAP financial measure and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry.
We calculate and define Non-GAAP gross profit as gross profit excluding depreciation and amortization, share-based compensation and certain other non-cash and non-recurring items. We define and calculate EBITDA as net income or losses excluding interest income or expense, income tax expense or benefit, depreciation and amortization and Adjusted EBITDA as further adjusted for the following items: goodwill impairment charge, indefinite-lived intangible asset impairment charge, impairment of cost method investment, right-of-use assets impairment charge, transaction-related costs, (gain) loss from change in the tax receivable agreement liability, (gain) loss from changes in the fair value of the warrant liability and contingent consideration, share-based compensation and certain other non-cash and non-recurring items as described in the reconciliation below. We also report Non-GAAP gross profit and Adjusted EBITDA as a percentage of Non-GAAP revenue as additional measures to evaluate financial performance.
37
We include these non-GAAP financial measures because they are used by management to evaluate our core operating performance and trends and to make strategic decisions regarding the allocation of capital and new investments. These non-GAAP measures exclude certain expenses that are required in accordance with U.S. GAAP because they are non-recurring (for example, in the case of transaction-related costs, goodwill impairment charge, indefinite-lived intangible asset impairment charge, impairment of cost method investment and right-of-use assets impairment charge), non-cash (for example, in the case of depreciation, amortization, (gain) loss from change in the tax receivable agreement liability, (gain) loss from changes in the fair value of the warrant liability and contingent consideration and share-based compensation) or are not related to our underlying business performance (for example, in the case of interest income and expense). There are limitations to non-GAAP financial measures because they exclude charges and credits that are required to be included in the U.S. GAAP financial presentation. The items excluded from U.S. GAAP financial measures such as net income or loss to arrive at non-GAAP financial measures are significant components for understanding and assessing our financial performance. As a result, non-GAAP financial measures should be considered together with, and not alternatives to, financial measures prepared in accordance with U.S. GAAP.
The table below presents our Non-GAAP gross profit reconciled to our reported gross profit, the closest U.S. GAAP measure, for the periods indicated:
|
|
Three Months Ended May 31, |
|
|||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
||
Gross profit |
|
|
|
|
|
|
||
Reported gross profit |
|
$ |
73,591 |
|
|
$ |
72,660 |
|
Depreciation and amortization |
|
|
26,349 |
|
|
|
28,484 |
|
Non-recurring/non-operating costs (1) |
|
|
798 |
|
|
|
204 |
|
Share-based compensation (2) |
|
|
1,650 |
|
|
|
1,205 |
|
Non-GAAP gross profit |
|
$ |
102,388 |
|
|
$ |
102,553 |
|
Gross margin |
|
|
48.2 |
% |
|
|
48.1 |
% |
Non-GAAP gross margin |
|
|
67.1 |
% |
|
|
67.8 |
% |
The table below presents our Adjusted EBITDA reconciled to our net loss, the closest U.S. GAAP measure, for the periods indicated:
|
|
Three Months Ended May 31, |
|
|||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
||
Net loss |
|
$ |
(15,523 |
) |
|
$ |
(42,788 |
) |
Adjustments: |
|
|
|
|
|
|
||
Interest expense, net |
|
|
22,093 |
|
|
|
24,711 |
|
Income tax expense (benefit) |
|
|
2,168 |
|
|
|
(1,923 |
) |
Depreciation and amortization |
|
|
36,698 |
|
|
|
53,605 |
|
EBITDA |
|
|
45,436 |
|
|
|
33,605 |
|
EBITDA Margin |
|
|
29.8 |
% |
|
|
22.2 |
% |
Right-of-use assets impairment charge (1) |
|
|
305 |
|
|
|
— |
|
Acquisition-related adjustments (2) |
|
|
5,485 |
|
|
|
283 |
|
(Gain) loss from change in tax receivable agreement liability (3) |
|
|
(20,727 |
) |
|
|
3,974 |
|
Gain from change in fair value of warrant liability (4) |
|
|
(479 |
) |
|
|
(3,761 |
) |
Loss from change in fair value of contingent consideration (5) |
|
|
12,060 |
|
|
|
2,280 |
|
Non-recurring/non-operating costs (6) |
|
|
(1,099 |
) |
|
|
2,557 |
|
Share-based compensation (7) |
|
|
11,251 |
|
|
|
11,787 |
|
Adjusted EBITDA |
|
$ |
52,232 |
|
|
$ |
50,725 |
|
Adjusted EBITDA Margin |
|
|
34.2 |
% |
|
|
33.6 |
% |
38
Three Months Ended May 31, 2025 compared to Three Months Ended May 31, 2024
Gross Profit
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
|
|||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|
||||
Gross profit |
|
$ |
73,591 |
|
|
$ |
72,660 |
|
|
$ |
931 |
|
|
|
1 |
% |
Gross margin |
|
|
48.2 |
% |
|
|
48.1 |
% |
|
|
|
|
|
|
||
Gross profit was $73.6 million for the three months ended May 31, 2025, a $0.9 million, or 1%, increase compared to $72.7 million for the three months ended May 31, 2024. Subscriptions gross profit was up 2% while professional services and other gross profit was down 4%. Gross margin was 48% for the first quarter of fiscal 2026 and 2025.
Non-GAAP Gross Profit
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
|
|||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|
||||
Non-GAAP gross profit |
|
$ |
102,388 |
|
|
$ |
102,553 |
|
|
$ |
(165 |
) |
|
|
0 |
% |
Non-GAAP gross margin |
|
|
67.1 |
% |
|
|
67.8 |
% |
|
|
|
|
|
|
||
Non-GAAP gross profit was $102.4 million for the three months ended May 31, 2025, a $0.2 million decrease compared to $102.6 million for the three months ended May 31, 2024. The Non-GAAP gross margin was 67% and 68% in the first quarter of fiscal 2026 and 2025, respectively.
EBITDA
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
|
|||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|
||||
EBITDA |
|
$ |
45,436 |
|
|
$ |
33,605 |
|
|
$ |
11,831 |
|
|
|
35 |
% |
EBITDA margin |
|
|
29.8 |
% |
|
|
22.2 |
% |
|
|
|
|
|
|
||
EBITDA was $45.4 million for the three months ended May 31, 2025, an $11.8 million, or 35%, increase compared to $33.6 million for the three months ended May 31, 2024. EBITDA margin was 30% for the first quarter of fiscal 2026 compared to 22% in the prior year. The increase in EBITDA and EBITDA margin was primarily related to the $24.7 million increase in the gain from change in tax receivable agreement liability and $5.3 million in lower interest expense and other, net. These increases were partially offset by the $5.2 million increase in acquisition-related expenses, $3.3 million decrease in the gain for the fair value adjustment for the warrant liability and $9.8 million increase in the loss for the fair value adjustment for the contingent consideration liability related to the restricted Series B-2 common stock as compared to prior periods.
Adjusted EBITDA
|
|
Three Months Ended May 31, |
|
|
|
|
|
|
|
|||||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|
% Change |
|
||||
Adjusted EBITDA |
|
$ |
52,232 |
|
|
$ |
50,725 |
|
|
$ |
1,507 |
|
|
|
3 |
% |
Adjusted EBITDA margin |
|
|
34.2 |
% |
|
|
33.6 |
% |
|
|
|
|
|
|
||
Adjusted EBITDA was $52.2 million for the three months ended May 31, 2025, a $1.5 million, or 3%, increase compared to $50.7 million for the three months ended May 31, 2024. Adjusted EBITDA margin was 34% for the first quarter of fiscal 2026 and 2025. The increase in Adjusted EBITDA was primarily a result of higher revenue and lower operating expenses compared to prior periods.
39
Liquidity and Capital Resources
We measure liquidity in terms of our ability to fund the cash requirements of our business operations, including working capital, capital expenditure needs, contractual obligations and other commitments, with cash flows from operations and other sources of funding. Current working capital needs relate mainly to employee compensation and benefits, as well as interest and debt. Our ability to expand and grow our business will depend on many factors, including working capital needs and the evolution of our operating cash flows.
We had $230.2 million in cash and cash equivalents and $123.8 million of unused borrowing capacity under our 2021 Revolving Credit Facility as of May 31, 2025. See Note 11, Notes Payable to the Notes to the Unaudited Condensed Consolidated Financial Statements. We believe our existing cash and cash equivalents, cash provided by operating activities and, if necessary, the borrowing capacity under our 2021 Revolving Credit Facility will be sufficient to meet our working capital, debt repayment and capital expenditure requirements for at least the next twelve months.
In the future, we may enter into arrangements to acquire or invest in complementary businesses. To facilitate these acquisitions or investments, we may seek additional equity or debt financing.
Debt
2021 Term Loan and Revolving Credit Facility
In February 2021, E2open, LLC, our subsidiary, entered into the Credit Agreement which provided for the 2021 Term Loan in the amount of $525.0 million and the 2021 Revolving Credit Facility for $75.0 million. In September 2021, the Credit Agreement was amended to include a $380.0 million incremental term loan, an increase in the letter of credit sublimit from $15.0 million to $30.0 million and an increase in the 2021 Revolving Credit Facility from $75.0 million to $155.0 million. In April 2022, the Credit Agreement was amended to include a $190.0 million incremental term loan bringing our total borrowing under the term loans to $1,095.0 million.
On April 18, 2025, E2open, LLC signed an amendment to the Credit Agreement to extend the maturity date of the 2021 Revolving Credit Facility to February 4, 2028 to coincide with the maturity date of the 2021 Term Loan. Additionally, the availability under the 2021 Revolving Credit Facility decreased from $155.0 million to $123.8 million.
E2open, LLC can request increases in the revolving commitments and additional term loan facilities, in minimum amounts of $2.0 million for each facility. Principal payments are due on the Credit Agreement the last day of February, May, August and November commencing August 2021. The Credit Agreement is payable in quarterly installments of $2.7 million.
The 2021 Term Loan has a variable interest rate resulting in an interest rate of 7.94% as of May 31, 2025 and February 28, 2025, which was based on SOFR plus 350 basis points. As of May 31, 2025 and February 28, 2025, the 2021 Term Loan had a principal balance outstanding of $1,053.5 million and $1,056.3 million, respectively. As of May 31, 2025, we had $0.2 million of accrued unpaid interest on our 2021 Term Loan recorded in accounts payable and accrued liabilities on the Unaudited Condensed Consolidated Balance Sheets. There were no outstanding borrowings, no letters of credit and $123.8 million available borrowing capacity under the 2021 Revolving Credit Facility as of May 31, 2025. There were no outstanding borrowings, no letters of credit and $155.0 million available borrowing capacity under the 2021 Revolving Credit Facility as of February 28, 2025.
Beginning in March 2023, we entered into zero-cost interest rate collars to reduce our exposure to the variability of our interest rate associated with our outstanding debt. By keeping interest rates within the executed bands, or caps and floors, of the collars, we are able to reduce exposure to the interest rate risk. Effective March 31, 2023, we entered into an interest rate collar with a notional amount of $200.0 million and a maturity date of March 31, 2026. The executed cap was 4.75% and the floor was 2.57%. Effective April 6, 2023, an additional interest rate collar was executed with a notional amount of $100.0 million and a maturity date of March 31, 2026. The executed cap was 4.50% and the floor was 2.56%.
40
Cash Flows
The following table presents net cash from operating, investing and financing activities:
|
|
Three Months Ended May 31, |
|
|||||
($ in thousands) |
|
2025 |
|
|
2024 |
|
||
Net cash provided by operating activities |
|
$ |
41,795 |
|
|
$ |
35,916 |
|
Net cash used in investing activities |
|
|
(7,326 |
) |
|
|
(6,084 |
) |
Net cash used in financing activities |
|
|
(3,896 |
) |
|
|
(3,006 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
|
(2,693 |
) |
|
|
76 |
|
Net increase in cash, cash equivalents and restricted cash |
|
|
27,880 |
|
|
|
26,902 |
|
Cash, cash equivalents and restricted cash at beginning of period |
|
|
212,135 |
|
|
|
149,038 |
|
Cash, cash equivalents and restricted cash at end of period |
|
$ |
240,015 |
|
|
$ |
175,940 |
|
Three Months Ended May 31, 2025 compared to Three Months Ended May 31, 2024
As of May 31, 2025, our consolidated cash, cash equivalents and restricted cash was $240.0 million, a $27.9 million increase from our balance of $212.1 million as of February 28, 2025.
Net cash provided by operating activities for the three months ended May 31, 2025 was $41.8 million compared to $35.9 million for the three months ended May 31, 2024. The $5.9 million increase in cash was primarily driven by an increase in subscriptions revenue and changes in working capital items in fiscal 2026.
Net cash used in investing activities was $7.3 million and $6.1 million for the three months ended May 31, 2025 and 2024, respectively, which primarily represented cash used for the development of our software platform.
Net cash used in financing activities was $3.9 million and $3.0 million for the three months ended May 31, 2025 and 2024, respectively. Repayments under the 2021 Term Loan were consistent between periods at $2.8 million. We paid $0.5 million in debt issue costs associated with the amendment of our Credit Agreement in fiscal 2026. We paid $0.2 million in additional finance lease payments in fiscal 2026 than in fiscal 2025. Additionally, we received $0.2 million from the exercise of stock options in fiscal 2025.
Tax Receivable Agreement
Concurrently with the completion of the Business Combination, we entered into the Tax Receivable Agreement with certain selling equity holders of E2open Holdings. The Tax Receivable Agreement provides for the payment by the Company of 85% of certain tax benefits that are realized or deemed realized as a result of increases in tax, utilization of pre-existing tax attributes of certain sellers and realization of additional tax benefits attributable to payments under the Tax Receivable Agreement. The term of the Tax Receivable Agreement will continue until all such tax benefits have been utilized or expired unless we exercise our right to terminate the Tax Receivable Agreement for an amount representing the present value of anticipated future tax benefits under the Tax Receivable Agreement or certain other acceleration events occur. We will retain the benefit of the remaining 15% of these cash savings.
Amounts payable under the Tax Receivable Agreement will be contingent upon, among other things, our generation of taxable income over the term of the Tax Receivable Agreement. If we do not generate sufficient taxable income in the aggregate over the term of the Tax Receivable Agreement to utilize the tax benefits subject to the Tax Receivable Agreement, we would not be required to make the related payments under the Tax Receivable Agreement. Although the amount of any payments required to be made under the Tax Receivable Agreement may be significant, the timing of these payments will vary and will generally be limited to one payment per member per year. During the year ended February 28, 2025, we paid $1.8 million to Tax Receivable Agreement holders of E2open Holdings. We did not make any payments to Tax Receivable Agreement holders of E2open Holdings during the three months ended May 31, 2025.
On May 25, 2025, the TRA Amendment was signed in connection with the Merger Agreement with WiseTech. Under the TRA Amendment, the parties to the Tax Receivable Agreement will receive an aggregate of $52.5 million with the closing of the transaction with WiseTech in full satisfaction of our obligations under the Tax Receivable Agreement. This amount represents a reduction from what was contractually obligated to be paid under the change of control provisions of the Tax Receivable Agreement without the TRA Amendment. Any payments that were otherwise scheduled under the Tax Receivable Agreement prior to the closing of the transaction will not occur in accordance with the TRA Amendment.
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As of May 31, 2025 and February 28, 2025, we had a current Tax Receivable Agreement liability of $42.7 million and $4.2 million, respectively, which was recorded in accounts payable and accrued liabilities on the Condensed Consolidated Balance Sheets. As of May 31, 2025, the full amount of the Tax Receivable Agreement liability was considered current under the TRA Amendment as it is payable upon closing of the merger transaction, which is expected to close by the end of the calendar year 2025. The determination of the current and long-term portion as of February 28, 2025 was based on management's estimate of taxable income for the fiscal year and the determination that a Tax Receivable Agreement liability payment was due and payable within the next twelve months.
The liability related to the Tax Receivable Agreement as of February 28, 2025 assumed (1) a corporate tax rate of 23.8%, (2) no dispositions of corporate subsidiaries, (3) no material changes in tax law and (4) we do not elect an early termination of the Tax Receivable Agreement. However, due to the uncertainty of various factors, including: (a) the timing and value of future exchanges, (b) the amount and timing of our future taxable income, (c) changes in our tax rate, (d) no future dispositions of any corporate stock, (e) changes in the tax law and (f) changes in the discount rate, the likely tax savings we will realize and the resulting amounts we are likely to pay to the selling equity holders of E2open Holdings pursuant to the Tax Receivable Agreement are uncertain. Interest accrues on the portion of the Tax Receivable Agreement liability recorded under ASC 805 at SOFR plus the applicable spread for the quarter. The portion of the Tax Receivable Agreement liability under ASC 450 was recorded on a gross undiscounted basis. These transactions, such as a conversion of Common Units to Class A Common Stock, result in a change in the Tax Receivable Agreement liability and a charge to equity.
The liability recorded on the balance sheet as of May 31, 2025 and February 28, 2025 does not include an estimate of the amount of payments to be made if certain sellers exchanged their remaining interests in E2open Holdings for our common stock, as this amount is dependent on several future variables, including timing of future exchanges, stock price at date of exchange, tax attributes of the individual parties to the exchange and changes in future applicable federal and state tax rates. The TRA Amendment would result in such an exchange upon closing the transaction with WiseTech and a $9.8 million obligation would be created upon this exchange. The $52.5 million settlement in the TRA Amendment is inclusive of this amount.
Warrant Liability
As of May 31, 2025 and February 28, 2025, there were an aggregate of 29,079,872 warrants outstanding. Each warrant entitles its holder to purchase one share of our Class A Common Stock at an exercise price of $11.50 per share. The warrants are recorded as a liability in warrant liability on the Condensed Consolidated Balance Sheets with a balance of $0.1 million and $0.6 million as of May 31, 2025 and February 28, 2025, respectively. During the three months ended May 31, 2025 and 2024, a gain of $0.5 million and $3.8 million was recognized in gain from change in fair value of the warrant liability in the Unaudited Condensed Consolidated Statements of Operations, respectively.
Contingent Consideration
The contingent consideration liability was $17.2 million and $5.1 million as of May 31, 2025 and February 28, 2025, respectively. The fair value remeasurements resulted in a loss of $12.1 million and $2.3 million for the three months ended May 31, 2025 and 2024, respectively. The change in the contingent consideration is recognized in gain (loss) from change in fair value of the contingent consideration in the Unaudited Condensed Consolidated Statements of Operations. The contingent liability represents the Series B-2 common stock and Series 2 RCUs.
Leases
We account for leases in accordance with ASC 842, which requires lessees to recognize lease liabilities and ROU assets on the balance sheet for contracts that provide lessees with the right to control the use of identified assets for periods of greater than 12 months.
Our non-cancelable operating leases for our office spaces and vehicles have various expiration dates through September 2031. Under these leases, our undiscounted future cash flows utilized in the calculation of the lease liabilities as of May 31, 2025 were: $5.2 million for June 1, 2025 through February 28, 2026, $5.4 million for fiscal 2027, $3.1 million for fiscal 2028, $1.5 million for fiscal 2029, $0.8 million for fiscal 2030 and $0.7 million thereafter. These numbers include interest of $1.9 million.
Our non-cancelable financing lease arrangements relate to software and computer equipment and have various expiration dates through November 2028. We have the right to purchase the software and computer equipment anytime during the lease or upon lease completion. Under these leases, our undiscounted future cash flows utilized in the calculation of the lease liabilities as of May 31, 2025 were: $1.8 million for June 1, 2025 through February 28, 2026, $1.9 million for fiscal 2027, $1.0 million for fiscal 2028 and $0.6 million for fiscal 2029. These numbers include interest of $0.5 million.
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Global Business Services Agreement
On December 27, 2024, we entered into a Master Service Agreement (MSA) with a third party which will provide certain global business services, transformation advisory services and digital solutions for us in an effort to drive long-term transformation and efficiencies for its internal processes. The term of the agreement is seven years. The MSA can be terminated after twelve months with at least 180-days’ notice and payment of the applicable termination fee, which ranged from $2.5 million to $17.0 million depending upon the reason and timing of the termination. On June 19, 2025, an amendment to the MSA was signed and termination fees were adjusted to a range of $4.0 million to $13.2 million depending on the reason and timing of the termination.
Pending Corporate Transactions
On May 25, 2025, we entered into the Merger Agreement to be acquired by WiseTech. Under the terms of the transaction, our stockholders will receive $3.30 per share.
Effect on Capital Stock
At the closing of the transaction, each issued and outstanding share of Class A Common Stock, Series B-1 common stock, Series B-2 common stock, Common Units and Series 2 RCUs will be converted into the right to receive cash equal to $3.30. The Class V Common Stock will be cancelled and extinguished without any conversion or consideration paid.
Additionally, the outstanding warrants will automatically cease to represent a warrant exercisable for our Class A Common Stock and will become exercisable in exchange for the Warrant Price, or $11.50 per share, for $3.30 in accordance with the terms of the Warrant Agreement. If a registered holder under the Warrant Agreement properly exercises a warrant within 30 days following the public disclosure of the completion of the proposed merger with WiseTech, the Warrant Price with respect to such exercise shall be reduced by an amount equal to the difference of (a) the Warrant Price in effect prior to such reduction minus (b) (1) $3.30 minus (2) the Black-Scholes Warrant Value (as defined in the Warrant Agreement).
Treatment of Company Equity Awards
At the closing of the transaction, each outstanding option with an exercise price less than $3.30 will be cancelled and converted into the right to receive cash equal to the excess of $3.30 over the option's exercise price per share. Each outstanding option with an exercise price equal to or greater than $3.30 or where the performance-based vesting conditions are not satisfied as a result of the transaction, will be cancelled at the closing of the transaction with no cash payment made.
Any restricted stock unit (RSU) that is vested but unsettled immediately prior to the closing of the transaction, is held by a non-employee board of director or advisory board member, vests in connection with the transaction or is held by an award holder whose aggregate unvested RSUs has a value of $10,000 or less will be cancelled and converted into the right to receive cash equal to $3.30 per share.
All other outstanding RSUs will be cancelled and exchanged for WiseTech restricted stock unit awards covering a number of ordinary shares equal to the product of the equity award ratio and the number of Class A Common Stock underlying the RSU with any resulting fractional shares rounded down to the nearest whole share. If WiseTech determines that converting the RSUs into WiseTech restricted stock unit awards is impracticable, such RSUs will instead be converted into the right to receive cash equal to $3.30 per share.
For the performance-based RSUs, the revenue growth performance target will be deemed achieved at 100% and the stock price condition will be measured using a value of $3.30. Any performance-based vesting conditions that are not satisfied will result in the cancellation of the associated performance-based RSUs.
At the time of the transaction, each performance-based RSU with a time-vesting component that accelerates, or each performance-based RSU with no time-vesting component, will be converted into the right to receive cash equal to $3.30 per share. All other performance-based RSUs will be cancelled and exchanged for WiseTech restricted stock unit awards covering a number of ordinary shares equal to the product of the equity award ratio and the number of Class A Common Stock underlying the performance-based RSU, with any resulting fractional shares rounded down to the nearest whole share. If WiseTech determines that converting the performance-based RSUs into WiseTech restricted stock unit awards is impracticable, such performance-based RSUs will instead be converted into the right to receive cash equal to $3.30 per share.
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Termination Rights and Termination Fees
The Merger Agreement between us and WiseTech contains certain customary termination rights including if the proposed merger is not completed on or before the Termination Date, unless WiseTech, under certain circumstances in its sole discretion, has extended the Termination Date to May 26, 2026. In the case of termination, we will be required to pay WiseTech a termination fee of $37.5 million and WiseTech is also required to pay us a termination fee of $75.0 million under certain conditions.
Tax Receivable Agreement Amendment
The Tax Receivable Agreement was amended in connection with the Merger Agreement. See Note 10, Tax Receivable Agreement for additional details. Under the TRA Amendment, the parties to the Tax Receivable Agreement will receive an aggregate of $52.5 million in cash in connection with the closing of the transaction with WiseTech in full satisfaction of our obligations under the Tax Receivable Agreement. This amount represents a reduction from what we otherwise would have been contractually obligated to pay under the change of control provisions of the Tax Receivable Agreement without the TRA Amendment. Any payments that were otherwise scheduled under the Tax Receivable Agreement prior to the closing of the transaction will not occur in accordance with the TRA Amendment.
Closing Conditions and Status
The closing of the transaction is dependent upon and subject to several closing conditions, including:
Pursuant to the rules adopted by the SEC, we prepared and filed with the SEC on July 2, 2025, a Preliminary Information Statement on Schedule 14C containing more information about the Merger Agreement and proposed merger with WiseTech.
During the three months ended May 31, 2025 and 2024, we incurred expenses of $5.5 million and $0.3 million related to the strategic review and sale of the Company. These expenses are included in acquisition-related expenses on the Unaudited Condensed Consolidated Statements of Operations.
The aggregate financial advisor fees associated with the transaction are not to exceed $33.1 million. Upon announcement of the transaction, $2.1 million of the financial advisor fees became payable, with the remainder of the fees contingent upon the closing of the transaction.
The transaction is expected to close by the end of calendar 2025.
Critical Accounting Policies and Estimates
Our unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP. Preparation of the financial statements requires management to make judgments, estimates and assumptions that impact the reported amount of revenue and expenses, assets and liabilities and the disclosure of contingent assets and liabilities. We consider an accounting judgment, estimate or assumption to be critical when (1) the estimate or assumption is complex in nature or requires a high degree of judgment and (2) the use of different judgments, estimates and assumptions could have a material impact on our unaudited condensed consolidated financial statements. Our significant accounting policies are described in Note 2, Summary of Significant Accounting Policies to the Notes to the Consolidated Financial Statements in our 2025 Form 10-K.
There have been no changes to our critical accounting policies and estimates during the three months ended May 31, 2025 from those previously disclosed in Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations in our 2025 Form 10-K.
Recent Accounting Pronouncements
Recently issued accounting pronouncements are described in Note 3, Accounting Standards to the Notes to the Unaudited Condensed Consolidated Financial Statements.
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Item 3. Quantitative and Qualitative Disclosures About Market Risk.
There have been no material changes in the market risks during the three and nine months ended May 31, 2025 from those previously disclosed in Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk of our 2025 Form 10-K.
Item 4. Controls and Procedures.
Disclosure Controls and Procedures
We have disclosure controls and procedures in place to ensure that information required to be disclosed in our reports filed or submitted under the Securities and Exchange Act of 1934, as amended (Exchange Act) is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms. These controls and procedures are accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we performed an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by the Quarterly Report. In designing and evaluating these disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating and implementing possible controls and procedures. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this Quarterly Report, our disclosure controls and procedures were effective.
Changes in Internal Control over Financial Reporting
There have not been any changes in our internal controls over financial reporting during the quarter ended May 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. We review our disclosure controls and procedures, which may include internal controls over financial reporting, on an ongoing basis. From time to time, management makes changes to enhance the effectiveness of these controls and ensure that they continue to meet the needs of our business over time.
PART II—Other Information
Item 1. Legal Proceedings.
From time to time, we are subject to contingencies that arise in the ordinary course of business. We record an accrual for a contingency when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We do not currently believe the resolution of any other such contingencies will have a material adverse effect upon our Unaudited Condensed Consolidated Balance Sheets, Statements of Operations or Statements of Cash Flows.
Item 1A. Risk Factors.
Except for the risks noted below, there have been no material changes to our risk factors from those previously disclosed in Part I, Item 1A, Risk Factors of our 2025 Form 10-K. You should carefully consider the risk factors below and those discussed in our 2025 Form 10-K, which could materially affect our business, financial condition or future results. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially adversely affect our business, financial condition or future results.
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Risks Related to the Proposed Merger
Uncertainties associated with the proposed mergers could adversely affect our business, results of operations, stock price and financial condition.
On May 25, 2025, we entered into the Merger Agreement with WiseTech, providing for the acquisition of us by WiseTech. If the proposed merger is completed, our Class A Common Stock will be delisted from the NYSE and deregistered under the Exchange Act. Completion of the merger is subject to various closing conditions, including, but not limited to, the receipt of required regulatory clearances, including the expiration or termination of the applicable waiting period under the HSR Act. The regulatory agencies from which certain of these clearances will be sought have broad discretion in administering the governing regulations. As a condition to their clearance of the merger, agencies may impose requirements, limitations or costs or require divestitures or place restrictions on the conduct of the parties’ business. These requirements, limitations, costs, divestitures or restrictions could jeopardize or delay the completion of the proposed merger. The parties to the Merger Agreement may not receive the necessary approvals for the transaction or receive them within the expected timeframe. There is no guarantee that all closing conditions will be satisfied (or waived, if permitted by the Merger Agreement and applicable law). Many of the conditions to completion of the merger are not within our control, and we cannot predict when or if these conditions will be satisfied (or waived, if permitted by the Merger Agreement and applicable law). In addition, the merger may fail to close for other reasons.
The announcement and pending conclusion of the merger, as well as any delays in the expected timeframe, could cause disruption in and create uncertainties, which could have an adverse effect on our business, results of operations, stock price and financial condition, regardless of whether the transaction is completed, and could cause us not to realize some or all of the benefits that we expect to achieve if the merger is successfully completed within the expected timeframe. These risks include, but are not limited to:
Failure to complete the merger with WiseTech could adversely affect our business and the market price of our shares of Class A Common Stock.
The closing of the merger with WiseTech may not occur on the expected timeline or at all. The Merger Agreement contains certain termination rights for us and WiseTech, including (i) if the merger is not completed on or before the Termination Date, (subject to an extension, in WiseTech’s sole discretion for three months under certain circumstances for the purpose of obtaining certain regulatory approvals), (ii) if the other party breaches its representations, warranties or covenants in a manner that would cause the conditions to the closing of the merger set forth in the Merger Agreement to not be satisfied and fails to cure such breach, or (iii) if any law or order prohibiting the merger or the transaction contemplated thereby has become final and non-appealable. If the merger is not completed, the price of our Class A Common Stock may decline, and you may not receive a price for your shares similar to what has been offered pursuant to the merger.
In addition, if the Merger Agreement is validly terminated by WiseTech under the circumstances set forth in the Merger Agreement, we will be required to pay WiseTech a termination fee equal to $37.5 million. If we are required to pay this termination fee, such fee, together with costs incurred to execute the Merger Agreement and pursue the merger, could have a material adverse effect on our financial condition and results of operations.
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The Merger Agreement contains provisions that limit our ability to pursue alternatives to the merger with WiseTech.
Under the Merger Agreement, we are restricted from soliciting, initiating, proposing, inducing, facilitating or knowingly encouraging alternative acquisition proposals from third parties and/or providing non-public information to third parties in response to any inquiries regarding, or the submission of any proposal or offer that constitutes, or would reasonably be expected to lead to, any Acquisition Proposal (as defined in the Merger Agreement). These provisions could discourage a third party that may have an interest in acquiring all or a significant part of our business from considering or proposing that acquisition, even if such third party were prepared to pay consideration with a higher value than the value of the consideration in the merger.
We are subject to certain restrictions on the conduct of our business under the terms of the Merger Agreement.
Under the terms of the Merger Agreement, we have agreed to certain restrictions on the operations of our business that could harm our business relationships, financial condition, operating results, cash flows and business, including restrictions with respect to our ability to, among other things, subject to certain specified exceptions, (as set forth in the Merger Agreement): adopt, amend, modify or terminate any employee plans (as defined in the Merger Agreement); materially increase the compensation of any director, officer or employee; hire or terminate any employee earning above a certain salary or wage (other than in the ordinary course); compromise or settle certain legal proceedings; change our methods, principles or practices of financial accounting; incur capital expenditures above specified thresholds; freely issue securities; and incur indebtedness (subject to certain exceptions). Because of these restrictions, we may be prevented from undertaking certain actions with respect to the conduct of our business that we might otherwise have taken if not for the Merger Agreement. Such restrictions could prevent us from pursuing certain business opportunities that arise prior to the effective time of the merger with WiseTech and are outside the ordinary course of business and could otherwise adversely affect our business and operations prior to completion of the merger with WiseTech.
Lawsuits may be filed against us relating to the merger with WiseTech, which could adversely affect our business, financial condition and operating results.
Lawsuits relating to the merger with WiseTech could be filed against us. Such litigation is common in connection with acquisitions of public companies, regardless of any merits related to the underlying acquisition. The outcome of any lawsuits filed against us would be uncertain, and we may not be successful in defending against any such claims. While we will defend against any lawsuits filed against us in connection with the merger with WiseTech, the costs of the defense of such actions and other effects of such litigation could have an adverse effect on our business, financial condition and operating results.
Item 5. Other Information
Rule 10b5-1 Trading Arrangements
During the quarter ended May 31, 2025, none of our directors and officers
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Item 6. Exhibits.
Furnish the exhibits required by Item 601 of Regulation S-K (§ 229.601 of this chapter).
Exhibit Number |
|
Description |
2.1 |
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Agreement and Plan of Merger, dated May 25, 2025, by and among WiseTech Global Limited, Emerald Parent Merger Sub Corp, Emerald Holdings Merger Sub LLC, E2open Parent Holdings, Inc and E2open Holdings, LLC (incorporated by reference to Exhibit 2.1 to Form 8-K, filed with the SEC on May 27, 2025). |
3.1 |
|
Certificate of Incorporation of E2open Parent Holdings, Inc. (incorporated by reference to Exhibit 3.2 of E2open Parent Holdings, Inc.'s Form 8-K (File No. 001-39272) filed with the SEC on February 10, 2021). |
3.2 |
|
Amendment to the Certificate of Incorporation of E2open Parent Holdings, Inc. (incorporated by reference to Exhibit 3.3 of E2open Parent Holdings, Inc.'s Form S-1 (File No. 333-259562) filed with the SEC on September 15, 2021). |
3.3 |
|
Bylaws of the E2open Parent Holdings, Inc. (incorporated by reference to Exhibit 3.3 of E2open Parent Holdings, Inc.'s Form 8-K (File 001-39272) filed with the SEC on February 10, 2021). |
4.1 |
|
Form of Warrant Certificate of CC Neuberger Principal Holdings I (incorporated by reference to Exhibit 4.3 of CCBN1’s Form S-1/A (File No. 333-236974), filed with the SEC on April 17, 2020). |
4.2 |
|
Warrant Agreement, dated April 28, 2020, between Continental Stock Transfer & Trust Company and CC Neuberger Principal Holdings I (incorporated by reference to Exhibit 4.1 of CCNB1’s Form 8-K (File No. 001-39272), filed with the SEC on April 28, 2020). |
4.3 |
|
Description of the Registrant’s Securities Registered under Section 12 of the Exchange Act (incorporated by reference to Exhibit 4.3 to Form 10-K, filed with the SEC on May 1, 2023). |
10.1 |
|
Amendment No. 5 to Credit Agreement and Agency Resignation and Appointment (incorporated by reference to Exhibit 10.1 to Form 8-K filed with the SEC on April 28, 2025). |
10.2 |
|
Tax Receivable Agreement Amendment No. 1, dated May 25, 2025, by and among E2open Parent Holdings, Inc. and E2open Holdings, LLC and the other parties thereto (incorporated by reference to Exhibit 10.1 to Form 8-K, filed with the SEC on May 27, 2025). |
31.1* |
|
Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
31.2* |
|
Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
32.1* |
|
Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
32.2* |
|
Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
101.INS |
|
Inline XBRL Instance Document |
101.SCH |
|
Inline XBRL Taxonomy Extension Schema Document |
104 |
|
Cover Page Interactive Data File (embedded within the Inline XBRL document and contained in Exhibit 101) |
* Filed herewith
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
E2open Parent Holdings, Inc. |
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|
|
|
|
Date: July 10, 2025 |
|
By: |
/s/ Andrew M. Appel |
|
|
|
Andrew M. Appel |
|
|
|
Chief Executive Officer |
|
|
|
|
Date: July 10, 2025 |
|
By: |
/s/ Marje Armstrong |
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|
|
Marje Armstrong |
|
|
|
Chief Financial Officer |
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Source:
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