PowerSchool $26.5 Million Securities Class Action Settlement

Investors who held PowerSchool Holdings Inc. common stock at the Oct. 1, 2024, closing of the company's acquisition by Bain Capital Private Equity LP and received $22.80 per share in cash may be eligible to receive a cash payment from a class action settlement.

PowerSchool agreed to pay, or have its insurers pay, $26.5 million to settle a stockholder class action lawsuit alleging Vista Equity Partners Management LLC and Onex Corp. breached their fiduciary duties as controlling stockholders. The lawsuit alleged they sold the company to Bain at an unfair price through a process they structured to favor Bain and never conditioned on minority stockholder approval.

Who are the class members?

The settlement class includes all record holders and beneficial owners of PowerSchool common stock who held shares at the closing of the acquisition by entities affiliated with Bain Capital Private Equity LP on Oct. 1, 2024, and received $22.80 per share in cash.

Additional details

• Both individuals and entities can be class members.
• The settlement includes stockholders who held shares in their own name and those who held through a broker or other nominee.
• The class includes legal representatives, heirs, successors-in-interest, transferees and assignees of eligible holders.
• The court certified the class as a non-opt-out class under Delaware Court of Chancery Rules 23(a), 23(b)(1) and 23(b)(2), meaning class members cannot exclude themselves from the settlement.

How much can class members get?

The total settlement fund is $26,500,000. The amount each class member receives depends on several factors:

• The number of eligible shares held at the closing of the acquisition on Oct. 1, 2024
• The total number of eligible shares in the class (approximately 60.2 million)
• The amount of the net settlement fund after court-approved deductions

The settlement administrator will distribute payments on a pro rata basis according to the court-approved plan of allocation:

• Each class member's payment equals the number of eligible shares they held at closing times the per-share recovery.
• The per-share recovery is the net settlement fund divided by the total number of eligible shares.
• The estimated per-share recovery is approximately $0.44 before deductions for taxes, notice and administration costs, and attorneys' fees and expenses.
• For shares held in a "street name" through a broker, the settlement administrator will distribute payments to Depository Trust & Clearing Corp. participants, who will then distribute payments on a pro rata basis to beneficial owners.
• For shares held of record outside DTC, the settlement administrator will distribute payments directly to the record holder.

No claim form needed to receive payment

Class members do not need to submit a claim form to receive payment. The settlement administrator will distribute payments the same way class members received the original $22.80 per share.

Settlement administrator's mailing address: PowerSchool Stockholders Litigation, c/o A.B. Data Ltd., P.O. Box 170500, Milwaukee, WI 53217

$26.5 million settlement fund

The $26,500,000 settlement fund includes:

• Notice and administration costs: To be determined
• Attorneys' fees: Up to $6,625,000
• Attorneys' expenses: Up to $500,000
• Payments to eligible class members: Remainder of the fund

Important date

• Fairness hearing: Nov. 9, 2026

When is the PowerSchool stockholder class action settlement payout date?

The settlement administrator will issue payments to eligible class members after the court resolves any appeals and grants final approval of the settlement.

Why did this class action settlement happen?

The class action lawsuit alleged Vista Equity Partners Management and Onex, as controlling stockholders of PowerSchool, breached their fiduciary duties by selling the copany to Bain at an unfair price. The plaintiffs claimed the two negotiated the deal while self-interested, retained conflicted advisors, structured the process to favor Bain and refused to condition it on minority stockholder approval.

The defendants denied all allegations of wrongdoing but agreed to settle to avoid the burden, expense and distraction of continued litigation.

Sources

• Class notice
• Settlement agreement