Exhibit (C)(xi)
Project Picasso Confidential Discussion Materials Prepared for the Special Committee of the Board of Directors June 2024
Disclaimer This presentation has been prepared by Centerview Partners LLC (“Centerview”) for use solely by the Special Committee of the Board of Directors of Picasso in connection with its evaluation of a proposed sale of Picasso and for no other purpose. The information contained herein is based upon information supplied by or on behalf of Picasso and publicly available information, and portions of the information contained herein may be based upon statements, estimates and forecasts provided by Picasso. Centerview has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or for any independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise) of Picasso or any other entity, or concerning the solvency or fair value of Picasso or any other entity. With respect to financial forecasts, Centerview has assumed that such forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of Picasso as to the future financial performance of Picasso, and at your direction Centerview has relied upon such forecasts, as provided by Picasso’s management, with respect to Picasso. Centerview assumes no responsibility for and expresses no view as to such forecasts or the assumptions on which they are based. The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise and Centerview assumes no obligation to update or otherwise revise these materials. The financial analysis in this presentation is complex and is not necessarily susceptible to a partial analysis or summary description. In performing this financial analysis, Centerview has considered the results of its analysis as a whole and did not necessarily attribute a particular weight to any particular portion of the analysis considered. Furthermore, selecting any portion of Centerview’s analysis, without considering the analysis as a whole, would create an incomplete view of the process underlying its financial analysis. Centerview may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analysis described above should not be taken to be Centerview’s view of the actual value of Picasso. These materials and the information contained herein are confidential, were not prepared with a view toward public disclosure, and may not be disclosed publicly or made available to third parties without the prior written consent of Centerview. These materials and any other advice, written or oral, rendered by Centerview are intended solely for the benefit and use of the Special Committee of the Board of Directors of Picasso (in its capacity as such) in its consideration of the proposed transaction, and are not for the benefit of, and do not convey any rights or remedies for any holder of securities of Picasso or any other person. Centerview will not be responsible for and has not provided any tax, accounting, actuarial, legal or other specialist advice. These materials are not intended to provide the sole basis for evaluating the proposed transaction, and this presentation does not represent a fairness opinion, recommendation, valuation or opinion of any kind, and is necessarily incomplete and should be viewed solely in conjunction with the oral presentation provided by Centerview. 1
Overview of Bain Proposal Submitted 6/2/2024 Share Price $22.80 * DSO 214.8 Implied Equity Value $4,897 Plus: Net Debt (Q3’24E) $708 Implied Enterprise Value $5,605 Metric Premium Unaffected Price (5/7/24) $16.64 +37.0% 52-week High (Unaffected) $25.02 (8.9%) 52-week Low (Unaffected) $16.58 +37.5% 10-Day VWAP (Unaffected) $17.01 +34.0% 30-Day VWAP (Unaffected) $18.58 +22.7% 60-Day VWAP (Unaffected) $19.91 +14.5% 90-Day VWAP (Unaffected) $20.74 +10.0% Memo: Current Price $22.24 +2.5% EV / Adjusted EBITDA (Consensus)(1) CY 2024E $270 20.8x NTM (as of 6/30/24) 288 19.4x CY 2025E 307 18.3x EV / Adjusted EBITDA (Management)(1) CY 2024E $277 20.2x NTM (as of 6/30/24) 309 18.2x CY 2025E 327 17.1x Memo: No TRA Liability to be Paid Source: Picasso management, Bloomberg and FactSet as of June 5, 2024. 2 Note: Picasso DSO as of 6/4/24 and balance sheet as of 9/30/24 per Picasso management estimate (balance sheet conforms to proposal letter). (1) Unburdened by stock-based compensation expense. NTM EBITDA as of 6/30/24.
Overview of Valuation Methodologies Methodology Description 52-Week ? Range of closing share prices for Picasso stock over the 52 weeks ending 5/7/2024 (unaffected date) Trading Range Analyst ? Price targets for Picasso per recent Wall Street analyst research reports as of latest available date Price Targets ? 1-day price premiums of announced or closed transactions with $1-10bn in implied Equity Value Premia Paid involving U.S. targets(1) EV / NTM ? EBITDA unburdened by stock-based compensation expense Adj. EBITDA ? Multiples applied to Picasso Management Plan NTM EBITDA EV / NTM ? EBITDA unburdened by stock-based compensation expense Adj. EBITDA ? Multiples applied to Picasso Management Plan NTM EBITDA ? Picasso Management Plan; includes value of TRA tax benefits retained by shareholders ? Assumes terminal EBITDA multiples of 15.0x – 19.0x ? Weighted Average Cost of Capital of 12.25% – 15.25% 3 Source: Picasso management, Wall Street research, FactSet and Bloomberg. (1) Per S&P Capital IQ. Excludes transactions in the Energy, Materials, Financials, Utilities and Real Estate industries, and transactions with negative premium.
Picasso Valuation Analysis Methodology Relevant Metrics Implied Share Price Range Low (5/3/2024) / 52-Week High (2/9/2024) $16.58 $25.02 Trading Range (Unaffected Date) Analyst Low / High $20.00 $31.00 Price Targets (Latest Available Reports) 15.0%—50.0% Premium Premia Paid $19.15 $24.95 (to Unaffected Price) EV / NTM 17.0x – 21.0x NTM Adj. $21.15 $26.85 Adj. EBITDA EBITDA of $309mm EV / NTM 18.0x – 22.0x NTM Adj. $22.60 $28.25 Adj. EBITDA EBITDA of $309mm WACC: 12.25% – 15.25% Terminal NTM EBITDA $21.65 $33.80 Multiple: 15.0x – 19.0x Bain Proposal 6/2/2024 $22.80 Source: Picasso management, public filings, CapitalIQ, FactSet and Bloomberg. Note: Dollars in millions except per share amounts. Balance sheet as of 9/30/2024 per Picasso management estimate. Fully diluted share count as of 6/4/24 inclusive of 4 MIUs. EBITDA figures unburdened by stock-based compensation expense. Share prices rounded to nearest $0.05, except for 52-week trading range. NTM metrics reflect NTM as of 6/30/24.
Share Price Performance Over Time Indexed Share Price Performance – Two Years Prior to Unaffected Date $32 $30 $28 $26 Picasso 52-Week High (2/9/24): $25.02 Current (Memo): $24 $22.24 $22 +66% $20 +48% $18 +34% $16.64 $16 Picasso 52- +24% $14 Week Low $13.42 (5/3/24): Picasso $12 $16.58 unaffected price $10 $8 $6 $4 $2 Picasso S&P 500 NASDAQ $0 May-22 Oct-22 Mar-23 Aug-23 Jan-24 Jun-24 5 Source: FactSet as of June 5, 2024. Note: Prices indexed to Picasso as of May 9, 2022. Unaffected date as of May 7, 2024.
Research Analyst Price Targets As of 5/7/24 Prem. to Pre Earnings Broker Price Target Valuation Methodology Unaff. SP Price Targets $31.00 86.3% 23.5x EV / CY’25E EBITDA $30.00 $30.00 80.3% 22.0x EV / FY’25E EBITDA supported by DCF $30.00 $27.00 62.3% DCF (11.7% WACC, 3.5% TGR) $27.00 24.0x EV / FCF on Q5—Q8 estimates $26.00 56.3% $30.00 Lowered from 27x based on lower peer multiples $26.00 56.3% 7.5x EV / FY’24E Revenue $26.00 $25.00 50.2% EV / CY’24E EBITDA $30.00 6.5x EV / CY’25E Revenue $24.00 44.2% $29.00 Downward revision given peer group multiple compression 18.0x EV / CY’25E EBITDA $23.00 38.2% $28.00 Reduced multiple from 21x CY’25E EBITDA 7.0x EV / CY’24E Revenue $22.00 32.2% $27.00 Lowered from 8x based on peer group multiple contraction $22.00 32.2% 18x EV / ‘25E EBITDA and 27x EV / ‘25E FCF $26.00 21.6x EV/ CY’25E FCF $20.00 20.2% $25.00 Multiple based on regression of peers Median $25.00 50.2% Buy Hold 6 Source: Wall Street research, Bloomberg and FactSet.
10 Year Management Plan Summary FY’23A FY’24 FY’25 FY’26 FY’27 FY’28 FY’29 FY’30 FY’31 FY’32 FY’33 FY’34 Revenue $698 $788 $874 $975 $1,093 $1,231 $1,392 $1,552 $1,707 $1,852 $1,977 $2,076 % Growth 10.6% 12.9% 10.9% 11.6% 12.1% 12.6% 13.1% 11.5% 10.0% 8.5% 6.7% 5.0% Adjusted Gross Profit $491 $559 $623 $701 $793 $900 $1,020 $1,141 $1,258 $1,367 $1,461 $1,536 % Margin 70.4% 70.9% 71.3% 71.9% 72.5% 73.1% 73.3% 73.5% 73.7% 73.8% 73.9% 74.0% R&D $87 $98 $106 $116 $126 $138 $152 $167 $179 $185 $193 $197 S&M 109 122 132 143 157 174 192 210 226 235 242 249 G&A 62 62 59 64 70 75 81 87 93 97 101 104 Adj. EBITDA (Unburd. SBC) $232 $277 $327 $378 $439 $513 $595 $677 $760 $849 $925 $986 % Margin 33.2% 35.1% 37.4% 38.8% 40.1% 41.7% 42.8% 43.7% 44.5% 45.9% 46.8% 47.5% Stock-Based Compensation 63 87 96 107 120 135 153 171 188 204 218 228 D&A 130 146 156 154 155 155 165 155 152 150 147 144 Δ Deferred Revenue 33 40 53 59 68 81 93 103 114 123 132 138 Δ NWC (21) (18) (17) (20) (24) (28) (32) (36) (39) (43) (46) (48) Capital Expenditures 2 5 5 6 7 7 8 9 10 11 12 12 Capitalized R&D 39 41 44 46 49 52 59 63 66 68 68 67 Other(1) – 10 – – – – – – – – – – Source: Picasso management. 7 Note: Dollars in millions. Reflects management forecast received by Centerview on 5/6/24. (1) Includes India office expansion and incremental Q4’24 $5mm payment related to SchoolMessenger acquisition.
Selected Public Comparables Company Name Enterprise Value ($bn) Revenue EBITDA CY’24E NTM Picasso (Mgmt., Unaffected) $4.3 11.9% 18.7% 35.1% 14.6x Picasso (Consensus, Unaffected) $4.3 11.9% 15.1% 34.2% 15.2x Veeva $25.1 13.4% 19.9% 40.0% 22.0x Tyler Technologies 21.6 9.3% 14.5% 26.6% 36.1x AspenTech 13.3 8.5% 5.3% 40.3% 26.8x Guidewire 10.5 11.5% 76.5% 13.9% 62.5x Appfolio 8.4 22.1% 63.1% 26.2% 36.6x CCC 8.3 9.1% 10.9% 41.4% 20.3x Instructure (Unaffected)(1) 4.2 7.1% 12.7% 41.2% 14.6x Q2 4.1 10.8% 38.9% 16.3% 32.1x NCINO 3.6 14.6% 38.5% 17.3% 33.7x Docebo 1.1 18.3% 68.1% 15.2% 28.1x Peer Median 11.2% 29.2% 26.4% 30.1x % Discount—Picasso Cons. EV / NTM EBITDA vs. Peer Median (50%) Source: Picasso management, public filings and FactSet as of June 5, 2024. Note: All figures in USD. Picasso balance sheet and share count figures as of 10-K filing on 3/1/24; share price and estimates as of 5/7/24. EBITDA figures unburdened by stock-based compensation expense. Debt figures reflect face value. Convertible notes treated as equity if current stock price is above conversion price and as debt if below. TRA liabilities not included as debt-like item. Excludes operating leases. Peer NTM metrics reflect NTM as of 6/5/24, except for Instructure 8 which reflects NTM as of unaffected date (5/17/24). (1) Instructure growth figures are pro forma for Parchment acquisition. All metrics as of unaffected date (5/17/24); current affected multiple is 15.7x.
Multiple Evolution Over Time EV / NTM EBITDA – Two Years to Unaffected Date 60x Picasso Peer Median Instructure L2Y L1Y YTD Picasso 20.6x 20.0x 19.1x Peer Median 29.2x 30.7x 31.0x 50x Mult. Discount (8.6x) (10.7x) (12.0x) % Discount (30%) (35%) (39%) Memo: Instructure 18.0x 17.0x 15.1x 40x Memo: % Prem. +15% +18% +26% Peer current multiple 30x 30.1x 29.8x Picasso unaffected 20x mult. (5/7/24) 18.5x 16.1x 15.2x 14.6x INST unaffected 10x mult. (5/17/24) 0.0x May-22 Oct-22 Mar-23 Aug-23 Jan-24 Jun-24 Source: FactSet as of June 5, 2024 Note: Peer median includes Veeva, Tyler Technologies, AspenTech, Guidewire, Appfolio, CCC, Q2, Instructure, NCINO and Docebo. Unaffected date as of May 7, 9 2024. Excludes peer multiples that are negative or higher than 125x. Instructure multiple held constant after 5/17/24 (unaffected date). Instructure multiple includes impact of Parchment acquisition from the first day that consensus includes Parchment in EBITDA estimates (2/21/24).
Selected Precedent Transactions Annc. TEV NTM EBITDA 2-Yr Fwd. Date Acquirer Target ($bn) Sales EBITDA Margin Sales CAGR (1) (1) 1/25/24 Roper Technologies Procare $1.8 6.7x 18.4x 36.5% “Mid-Teens” 4/27/23 Deutsche Boerse SimCorp 4.3 6.4 26.4 24.1% 8.2% 8/30/22 Roper Technologies Frontline 3.4 9.1(2) 19.3(2) 47.3% “High Single Digits” 4/7/22 Brookfield CDK Global 8.2 4.4 11.7 37.9% 5.9% 8/5/21 Clearlake Capital Group Cornerstone On Demand 5.3 5.9 15.9 37.2% 9.0% 2/10/21 Tyler Technologies NIC 2.1 4.7 18.5 25.2% 1.3% 2/4/21 Insight / Stone Point CoreLogic 7.7 4.6 12.7 36.4% 0.7% 12/21/20 Thoma Bravo RealPage 10.4 8.2 28.7 28.4% 10.9% (3) 8/13/20 Roper Technologies Vertafore 5.4 9.1 18.4 49.2% n.a. 2/14/20 Thoma Bravo Instructure 1.9 6.1 n.a. n.a. 17.4% Mean 6.5x 18.9x 35.8% 7.6% Median 6.3 18.4 36.5% 8.2% Source: Public filings and materials, FactSet. (1) TEV and financial metrics per acquiror investor materials. TEV includes $110mm of estimated tax benefits. NTM multiples based on figures for 12 month period ending 3/31/25. Excluding tax benefits, EV / NTM Sales would be 7.2x and EV / NTM EBITDA multiple would be 19.6x. Forward growth guidance per management commentary on 4/26/24. (2) TEV and financial metrics per acquiror investor materials. TEV includes $350mm of estimated tax benefits. NTM multiples based on 2023E figures. Excluding the 10 tax benefits, the EV / Sales multiple would be 10.1x and the EV / EBITDA multiple would be 21.3x. Growth outlook based on Wall Street analyst commentary. (3) TEV and financial metrics per acquiror investor materials. NTM multiples based on figures for 2021E.
Picasso Discounted Cash Flow Analysis FY’24(1) FY’25 FY’26 FY’27 FY’28 FY’29 FY’30 FY’31 FY’32 FY’33 FY’34 NTM Revenue $788 $874 $975 $1,093 $1,231 $1,392 $1,552 $1,707 $1,852 $1,977 $2,076 $2,180 % Growth 12.9% 10.9% 11.6% 12.1% 12.6% 13.1% 11.5% 10.0% 8.5% 6.7% 5.0% 5.0% Adj. EBITDA (Unburd. SBC) $277 $327 $378 $439 $513 $595 $677 $760 $849 $925 $986 $1,036 % Margin 35.1% 37.4% 38.8% 40.1% 41.7% 42.8% 43.7% 44.5% 45.9% 46.8% 47.5% 47.5% (-): Stock-Based Compensation (87) (96) (107) (120) (135) (153) (171) (188) (204) (218) (228) (-): Cash Taxes (excl. TRA) (28) (36) (46) (57) (72) (88) (104) (121) (141) (157) (170) +/(-): Change in NWC 22 35 39 44 54 61 68 74 81 86 90 (-): CapEx & Capitalized R&D (46) (49) (52) (56) (60) (68) (72) (76) (79) (80) (80) (-): Other(2) (10) – – – – – – – – – – Unlevered Free Cash Flow $128 $181 $212 $250 $300 $347 $398 $449 $507 $557 $598 Discounted 15.0x 17.0x 19.0x 15.0x 17.0x 19.0x 15.0x 17.0x 19.0x Cash Flow Sensitivities 12.25% $6.7 $7.3 $8.0 12.25% $27.85 $30.80 $33.70 12.25% 7.8% 8.3% 8.7% (Excludes impact of TRA) 13.75% 6.0 6.5 7.1 13.75% $24.50 $27.00 $29.55 13.75% 9.3% 9.8% 10.2% 15.25% 5.3 5.8 6.3 15.25% $21.55 $23.75 $26.00 15.25% 10.7% 11.2% 11.6% Source: Picasso management. Note: Figures in $mm unless otherwise noted, except for per share figures. Picasso balance sheet as of 9/30/24 per Picasso management estimate and share count as of 6/4/24. EBITDA figures unburdened by stock-based compensation expense. Assumes mid-year discounting. Excludes impact of TRA. Share prices rounded to nearest $0.05. (1) Assumes valuation date of 9/30/2024; discounted cash flows only include Q4 cash flows from 2024. Q4’24 UFCF of $26mm. 11 (2) Includes India office expansion and incremental Q4’24 $5mm payment related to SchoolMessenger acquisition. (3) Implied perpetuity growth rate calculated based on FY’34E unlevered free cash flow.
Appendix
Picasso WACC Analysis Market Debt / Beta(1) Company Debt Cap. Equity Levered Unlevered Cost of Equity Q2 $495 $3,953 13% 2.07 1.89 20Y U.S. Treasury Yield 4.5% NCINO 54 3,641 1% 1.88 1.86 Unlevered Beta 1.35 Veeva – 29,867 0% 1.48 1.48 Target Debt / Equity 1% Docebo – 1,155 0% 1.44 1.44 Levered Beta 1.36 Tyler Technologies 600 21,165 3% 1.43 1.40 LT U.S. Historical Risk Premium(2) 7.2% Appfolio – 8,650 0% 1.31 1.31 Size Premium(2) 1.0% Guidewire – 11,450 0% 1.31 1.31 Cost of Equity 15.2% AspenTech – 13,463 0% 0.70 0.70 Instructure (Unaffect.) (5) 1,173 3,072 18% 0.75 0.67 Cost of Debt CCC 782 7,744 10% 0.70 0.65 Pre-Tax Cost of Debt(3) 7.4% Peer Median 1% 1.37 1.35 Tax Rate 25.0% Picasso (Unaffected) $838 $3,499 24% 1.14 0.97 After-Tax Cost of Debt 5.5% Memo: Debt / Capital 1% WACC(4) 15.2% Debt / Unlevered Beta Sensitivity Equity 1.00 1.09 1.18 1.26 1.35 –% 12.6% 13.3% 13.9% 14.5% 15.2% 10% 12.5% 13.1% 13.7% 14.3% 15.0% 20% 12.4% 13.0% 13.6% 14.2% 14.8% 30% 12.2% 12.8% 13.4% 14.0% 14.6% Source: Picasso management, KPMG, public filings, Bloomberg and FactSet as of June 5, 2024. Note: Figures in $mm unless otherwise noted, except for per share figures. Picasso balance sheet and share count figures as of 10-K filing on 3/1/24; Picasso beta as of unaffected date (5/7/2024). (1) Represents two-year unadjusted weekly average beta. Unlevered betas assume 25% tax rate for each company, except for Docebo which assumes 26.5%. (2) Duff & Phelps, 2023. Size premium reflects companies with market capitalization between $3.0bn and $4.6bn. (3) Reflects BofA B corporate index effective yield. (4) WACC equals ((debt / capitalization * (cost of debt * (1 – tax rate))) + (equity / capitalization * levered cost of equity)). (5) 13 Instructure debt to equity metric (and corresponding unlevered beta calculation) reflects average debt to equity over prior 8 quarters. INST beta as of INST unaffected date (5/17/2024).
TRA Benefit Discounted Cash Flow Analysis Reflects tax benefits of asset step-up during IPO captured through Picasso’s modified Up-C structure; Class A Shareholders retain 15% of TRA tax benefits (1) FY’24 FY’25 FY’26 FY’27 FY’28 FY’29 FY’30 FY’31 FY’32 FY’33-‘44 Total TRA Benefit $20 $22 $33 $42 $46 $33 $28 $20 $14 $99 x 15% 15.0% 15.0% 15.0% 15.0% 15.0% 15.0% 15.0% 15.0% 15.0% 15.0% TRA Benefit to Shareholders $3 $3 $5 $6 $7 $5 $4 $3 $2 $15 Present Value (2) Value Per Share ($mm) 12.25% $28 $0.14 13.75% 26 $0.13 15.25% 25 $0.12 Source: Picasso Tax Asset Projection. Note: Dollars in millions. Illustrative valuation date of 9/30/2024. Assumes mid-year discounting. 14 (1) Assumes valuation date of 9/30/2024; TRA benefit calculation only includes Q4 cash flows from 2024. Assumes FY’24 TRA benefit evenly prorated across the year. (2) Assumes value per share based on Picasso basic shares outstanding as of 6/4/24.
1-Day Premiums ? Reflects announced or closed transactions involving U.S. targets since 2014 ? Includes only transactions where implied equity between is between $1bn and $10bn ? Excludes transactions in Energy, Materials, Financials, Utilities and Real Estate industries 1-Day Premium(1) – N = 405 48% 24% 13% 25th Percentile Median 75th Percentile Source: S&P Capital IQ as of June 5, 2024. 15 Note: Screening criteria includes all cash announced and closed transactions involving U.S. targets, where the implied equity value is between $1bn and $10bn. Sample set excludes transactions in the Energy, Materials, Financials, Utilities and Real Estate industries. Also excludes transactions where premium was negative.
Quarterly Cash Flow and Balance Sheet Trends $220 $277 $174 $187 Cash Flow $42 $43 $52 $20 from ($16) ($33) ($26) ($65) ($60) ($90) Operating Activities Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1A Q2 Q3 Q4 2021A 2022A 2023A 2024E $165 $125 $70 Revolver $30 $10 $10 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1A Q2 Q3 Q4 2021A 2022A 2023A 2024E $838 $838 $836 $834 $832 $830 $754 $752 $750 $748 $746 $744 $742 $740 Term Loan Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1A Q2 Q3 Q4 2021A 2022A 2023A 2024E $802 $799 $943 $988 $663 $665 $756 $678 $722 $708 $677 $637 $607 $525 Net Debt Δ = ($165) Δ = ($197) Δ = ($280) Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1A Q2 Q3 Q4 2021A 2022A 2023A 2024E 16 Source: Picasso filings, Picasso management.
Picasso Capitalization Summary Price Per Share (Offer) $22.80 Basic Shares Outstanding (mm) 203.7 Restricted Stock Units 8.3 Issue / Participation Performance Stock Units Amount Payout Factor 0.5 Threshold Market-Share Units—Tranche 1 0.5 $19.48 1.17x 0.6 Market-Share Units—Tranche 2 0.4 $20.90 1.09x 0.4 Management Incentive Units 2.7 $12.11 n.m. 1.3 Fully Diluted Shares Outstanding 214.8 Equity Value ($mm) $4,897 17 Source: Picasso management. Note: Figures in $mm unless otherwise noted, except for per share figures. Share count as of 6/4/24.