ANSWERS CORP 8-K 2011
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):April 8, 2011
(Exact name of registrant as specified in its charter)
Registrant’s telephone number, including area code: (646) 502-4777
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Item 8.01. Other Events
On April 11, 2011, Answers Corporation (“Answers.com”), announced that its Board of Directors, advised by its independent financial and legal advisors, has concluded that the proposed transaction with AFCV Holdings, LLC (“AFCV”) remains in the best interests of Answers.com’s stockholders and unanimously reaffirmed its recommendation that stockholders vote to adopt the merger agreement between Answers.com and AFCV, a portfolio company of growth equity investor Summit Partners.
As more fully described below, Answers.com also announced the determination of its Board to reject an unsolicited proposal from a certain Brad D. Greenspan, purporting to represent Social Slingshot Pte Ltd. and eJuggernaut LLC, to acquire a controlling interest in Answers.com (the “Greenspan Proposal”).
The Greenspan Proposal
On Saturday, April 9, 2011, Israel time, Mr. Robert Rosenschein, chief executive officer of Answers.com, received by e-mail a letter, dated April 8, 2011, from Mr. Greenspan setting forth a proposal to acquire a controlling interest in Answers.com. Mr. Greenspan purported to deliver the letter “as representative of eJuggernaut LLC, and Social Slingshot Pte Ltd.” While the letter is not entirely clear or self-consistent, the following appear to be the terms of the acquisition proposal:
The proposal letter makes certain statements with respect to financing, diligence and documentation, and timing.
While not entirely clear, the proposal letter also appears to reflect the following plans for Answers.com, if the proposed transaction were consummated:
Consideration by the Answers.com Board
Mr. Greenspan’s proposal letter was distributed to all of the Answers.com directors on April 9, 2011 following receipt.
The Answers.com Board convened a telephonic meeting to discuss Mr. Greenspan’s proposal on Sunday April 10, 2011, together with its financial and legal advisors. All directors were present, except Mr. Mark Tebbe, who was in transit at the time but who confirmed his agreement with the determinations made by the Board.
At the meeting, the Board, with its advisers, thoroughly considered Mr. Greenspan’s proposal letter. Following its consideration, the Board unanimously concluded that the letter does not constitute, and is not reasonably likely to become a Superior Proposal (as defined in Answers.com’s existing merger agreement with AFCV). The Board therefore determined to reject the proposal and reaffirmed its recommendation that Answers.com stockholders vote at the special meeting of stockholders to adopt the merger agreement and for the proposal to adjourn the special meeting, if necessary, to solicit additional proxies if there are insufficient votes. The Board also determined to adjourn the special meeting of stockholders immediately after it is convened for 48 hours in order to give stockholders additional time to reflect upon and to react to Mr. Greenspan’s letter and the Board’s response.
In making its determination, the Board considered that under Mr. Greenspan’s proposal stockholders could receive $13.50 per share of common stock in exchange for their shares if such were to ultimately be consummated, as compared to $10.50 per share of common stock under the terms of the AFCV merger agreement. The Board also considered that under Mr. Greenspan’s proposal, stockholders could elect to retain their equity interest in Answers.com, and that all stockholders, irrespective of whether they received cash or retained their shares, would receive warrants to acquire common stock of Answers.com.
The Board nonetheless concluded that Mr. Greenspan’s proposal was unlikely to become a Superior Proposal, as defined in the merger agreement, for the following reasons:
In light of these considerations and other factors regarding the risks faced by Answers.com and described in the definitive proxy statement, the Answers.com Board of Directors concluded that Mr. Greenspan’s proposal did not constitute, and would not reasonably be expected to become, a Superior Proposal, as defined in the AFCV merger agreement, and has reaffirmed its recommendation set forth in the definitive proxy statement in favor of adoption of the merger agreement.
A copy of the Greenspan Proposal is attached hereto as Exhibit 99.1
On April 11, 2011, Answers.com issued a press release, attached hereto as Exhibit 99.2. The press release announced that the Answers.com Board of Directors has rejected the Greenspan Proposal, continues to recommend that Answers.com stockholders vote in favor of the pending merger with AFCV and will adjourn the special meeting of stockholders to vote on adoption of the merger agreement with AFCV immediately after it is commenced and reconvene the meeting at 10:00 a.m. Eastern Time on Thursday, April 14, 2011, at the offices of Kramer Levin Naftalis & Frankel LLP, 1177 Avenue of the Americas, New York, New York 10036.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits. The following exhibit is filed herewith:
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 hereunto duly authorized.
INDEX TO EXHIBITS