CTCT (MM)

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): January 15, 2016

 

 

Constant Contact, Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

 

Delaware		001- 33707		04-3285398
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

1601 Trapelo Road Waltham, Massachusetts				02451
(Address of principal executive offices)				(Zip Code)

Registrant’s telephone number, including area code: (781) 472-8100

(Former Name or Former Address, if Changed Since Last Report)

 

 

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 (see General Instruction A.2. below):

 

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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

x

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

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Item 2.02

Results of Operations and Financial Condition.

The information in Item 7.01 of this Current Report on Form 8-K is incorporated herein by reference and is furnished to, but not filed with, the U.S. Securities and Exchange Commission (the “SEC”).

 

Item 7.01

Regulation FD Disclosure.

As previously announced, on October 30, 2015, Constant Contact, Inc., a Delaware corporation (“Constant Contact”), entered into an Agreement and Plan of Merger with Endurance International Group Holdings, Inc., a Delaware corporation (“Endurance”), and Paintbrush Acquisition Corporation, a Delaware corporation and wholly-owned subsidiary of Endurance (“Merger Sub”), pursuant to which, among other things and subject to the terms and conditions set forth therein, Merger Sub will be merged with and into Constant Contact (the “Merger”), with Constant Contact surviving the Merger as a wholly-owned subsidiary of Endurance. In connection with the Merger, on December 9, 2015, Constant Contact filed with the SEC a definitive proxy statement (the “Proxy Statement”), which was mailed to the stockholders of Constant Contact on or about December 15, 2015. Stockholders will vote upon the Merger at a special meeting expected to be held on January 21, 2016.

In connection with the Merger, Constant Contact has provided to Endurance certain preliminary financial estimates for the fourth quarter ended December 31, 2015 and for the fiscal year ended December 31, 2015, which is set forth in this Current Report on Form 8-K and Exhibit 99.1. Such financial estimates have been prepared by Constant Contact’s management and are preliminary in nature. Constant Contact is currently in the process of finalizing such financial results. Constant Contact’s actual financial results may differ from these estimates.

The information in this Item 7.01 and Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

 

Item 8.01

Other Events.

The information in Item 7.01 of this Current Report on Form 8-K is incorporated herein by reference and is furnished to, but not filed with, the SEC.

 

Item 9.01

Financial Statements and Exhibits.

(d) Exhibits

The following exhibit, as it relates to Item 2.02 and Item 7.01 above, is furnished to, but not filed with, the Securities and Exchange Commission.

 

Exhibit No.		Description
99.1		Certain information with respect to Constant Contact that has not previously been reported to the public.

Additional Information About the Acquisition and Where to Find It

This communication is being made in respect of the proposed transaction involving Constant Contact and Endurance. A special stockholder meeting is expected to be held on January 21, 2016 to obtain stockholder approval

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in connection with the proposed merger between Constant Contact and Endurance. Constant Contact has filed with the SEC the Proxy Statement and other relevant documents and may file additional relevant documents in connection with the proposed merger. The Proxy Statement has been mailed to the shareholders of Constant Contact and contains important information about the proposed transaction and related matters. INVESTORS OF CONSTANT CONTACT ARE URGED TO READ THE PROXY STATEMENT AND OTHER RELEVANT MATERIALS CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT CONSTANT CONTACT, ENDURANCE AND THE PROPOSED MERGER. Investors may obtain a free copy of these materials and other documents filed by Constant Contact with the SEC at the SEC’s website at www.sec.gov, at Constant Contact’s website at www.constantcontact.com or by sending a written request to Constant Contact at 1601 Trapelo Road, Waltham, Massachusetts 02451, Attention: Investor Relations Department.

Participants in the Solicitation

Constant Contact, Endurance, and their respective directors, executive officers and certain other members of management and employees may be deemed to be participants in soliciting proxies from Constant Contact’s stockholders in connection with the proposed Merger. Information regarding Constant Contact’s and Endurance’s directors and executive officers is set forth in their respective definitive proxy statements for their respective 2015 Annual Meetings of Stockholders and their respective most recent annual reports on Form 10-K. Information regarding other persons who may, under the rules of the SEC, be considered to be participants in the solicitation of Constant Contact’s stockholders in connection with the proposed Merger is set forth in the Proxy Statement for its special stockholder meeting. Additional information regarding these individuals and Constant Contact’s and Endurance’s respective directors and executive officers and any direct or indirect interests they may have in the proposed Merger is set forth in the Proxy Statement.

Forward-Looking Statements

Certain statements contained in this filing may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding the transaction and the ability to consummate the transaction. These forward-looking statements generally include statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “believes,” “plans,” “anticipates,” “projects,” “estimates,” “expects,” “intends,” “strategy,” “future,” “opportunity,” “may,” “will,” “should,” “could,” “potential,” or similar expressions. Statements that are not historical facts are forward-looking statements. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties. Forward-looking statements speak only as of the date they are made, and Constant Contact undertakes no obligation to update any of them publicly in light of new information or future events. Actual results could differ materially from those contained in any forward-looking statement as a result of various factors, including, without limitation: uncertainties as to the timing of the contemplated transaction; uncertainties as to the approval of Constant Contact stockholders required in connection with the contemplated transaction; the possibility that a competing proposal will be made; the possibility that Endurance may not receive the anticipated financing or financing on the terms expected; the possibility that the closing conditions to the contemplated transaction may not be satisfied or waived, including that a governmental entity may prohibit, delay or refuse to grant a necessary regulatory approval; the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; risks that the transaction disrupts current plans and operations and the potential difficulties in employee retention as a result of the transaction; the possibility that the business of Constant Contact may suffer as a result of uncertainty surrounding the transaction or that Constant Contact may be adversely affected by other economic, business, legislative, regulatory and/or competitive factors; the risk that stockholder litigation or other legal proceedings in connection with the contemplated transaction may affect the timing or occurrence of the contemplated transaction or result in significant costs of defense, indemnification and liability; the possibility of the transaction involving unexpected costs, liabilities or delays; and other risks and uncertainties discussed in Constant Contact’s filings with the SEC, including the “Risk Factors” sections of Constant Contact’s most recent Quarterly Report on Form 10-Q for the period ended September 30, 2015 and most recent Annual Report on Form 10-K for the year ended December 31, 2014. If the transaction is consummated, Constant Contact’s stockholders will cease to have any equity interest in Constant Contact and will have no right to participate in its earnings and future growth. Additional factors that may affect the future results of Constant Contact are set forth in its filings with the SEC, including its Annual Report on Form 10-K for the year ended December 31, 2014 and recent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the SEC, which are available on the SEC’s website at www.sec.gov. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date thereof.

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SIGNATURE

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.

 

				CONSTANT CONTACT, INC.
Date: January 15, 2016				By:		/s/ Harpreet S. Grewal
						Harpreet S. Grewal
						Executive Vice President, Chief Financial Officer and Treasurer

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EXHIBIT INDEX

 

Exhibit No.		Description
99.1		Certain information with respect to Constant Contact that has not previously been reported to the public.

Exhibit 99.1

Constant Contact, Inc.

Certain Preliminary Unaudited Financial Results

for the Fourth Quarter and Year Ended December 31, 2015

Based on the information and data currently available, the following sets forth certain preliminary, unaudited financial information of Constant Contact, Inc. (the “Company” or “Constant Contact”) for the fourth quarter and year ended December 31, 2015. This information is inherently uncertain and subject to revision in connection with the finalization of financial statements for Constant Contact’s fourth quarter and year ended December 31, 2015. Given the timing of these estimates, Constant Contact has not completed its customary quarterly and yearly accounting close and review procedures as of and for the three months and year ended December 31, 2015, and its final results for these periods may differ materially from these estimates.

For the year ended December 31, 2015, revenue was approximately $367.4 million, compared to $331.7 million for the year ended December 31, 2014. Revenue for the fourth quarter of 2015 was approximately $93.6 million, compared to $88.1 million in the fourth quarter of 2014.

For the year ended December 31, 2015, net income was approximately $18.9 million, or approximately $0.57 per diluted share, compared to net income of $14.3 million, or $0.44 per diluted share, for the year ended December 31, 2014. Net income for the fourth quarter of 2015 was approximately $5.1 million, or approximately $0.16 per diluted share, compared to net income of $6.2 million, or $0.19 per diluted share, for the fourth quarter of 2014.

Adjusted EBITDA for the year ended December 31, 2015 was approximately $74.5 million, compared to $63.2 million for the year ended December 31, 2014. Adjusted EBITDA for the fourth quarter of 2015 was approximately $20.8 million, compared to $18.2 million in the fourth quarter of 2014.

The Company’s final consolidated financial results for the fourth quarter and year ended December 31, 2015 may vary from the Company’s expectations and may be materially different from the preliminary financial information provided above. As a result of the foregoing, the Company cautions readers not to place undue reliance on this preliminary financial information.

Non-GAAP Financial Measures

Constant Contact’s preliminary financial results set forth above include Adjusted EBITDA, which is a non-GAAP financial measure. For this purpose, Adjusted EBITDA is defined as GAAP net income before income taxes, interest and other income (expense), net, depreciation and amortization, stock-based compensation, litigation contingency accruals, transaction expenses related to the Agreement and Plan of Merger among the Company, Endurance International Group Holdings, Inc. (“Endurance”), and Paintbrush Acquisition Corporation (“transaction expenses”), and the change in deferred revenue. The principal limitation of Adjusted EBITDA is that it excludes expenses and income that are required by GAAP to be recorded in the company’s financial statements.

Constant Contact believes that non-GAAP financial measures, including Adjusted EBITDA, provide useful information to management and investors regarding certain financial and business trends relating to Constant Contact’s financial condition and results of operations. The Company’s management uses these non-GAAP measures to compare the company’s performance to that of prior periods for trend analyses, for purposes of determining certain components of executive and senior management incentive compensation, and for budgeting and planning purposes. These measures are used in monthly financial reports prepared for management and in monthly and quarterly financial reports presented to the

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company’s board of directors. The company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the company’s financial measures with other software-as-a-service companies, many of which present similar non-GAAP financial measures to investors.

Management of the company does not consider non-GAAP financial measures in isolation or as an alternative to financial measures determined in accordance with GAAP. In addition, non-GAAP financial measures are subject to inherent limitations as they reflect the exercise of judgments by management about which expenses and income are excluded or included in determining non-GAAP financial measures. In order to compensate for these limitations, management presents non-GAAP financial measures in connection with GAAP results. Constant Contact urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, and not to rely on any single financial measure to evaluate the company’s business.

A reconciliation of Adjusted EBITDA to the most comparable GAAP financial measure, GAAP net income, is set forth below:

 

		Year Ended December 31,								Three Months Ended December 31,
		2015				2014				2015				2014
Net Income		$	18,900			$	14,300			$	5,100			$	6,200
Stock-based compensation			18,100				16,600				4,800				4,500
Changes in deferred revenue			2,100				2,600				200				100
Transaction expenses			2,500				—				2,500				—
Income tax expense			8,200				5,800				1,900				1,200
Depreciation and amortization			24,900				24,200				6,400				6,100
Interest income and other (income) expense, net			(200	)			(300	)			(100	)			100
Adjusted EBITDA		$	74,500			$	63,200			$	20,800			$	18,200

 

*

Constant Contact’s historical definition of Adjusted EBITDA did not reflect the change in deferred revenue as set forth in the reconciliation above. Using Constant Contact’s historical definition of Adjusted EBITDA, and also adding back transaction expenses, (i) Adjusted EBITDA for the years ended December 31, 2015 and 2014 was approximately $69.9 million and $60.6 million, respectively, and (ii) Adjusted EBITDA for the three months ended December 31, 2015 and 2014 was approximately $18.1 million and $18.1 million, respectively.

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Forward-Looking Statements

This Exhibit 99.1 contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding Constant Contact’s preliminary unaudited financial results for the fourth quarter and full year ended December 31, 2015. These forward-looking statements reflect management’s current expectations, which are based on the information currently available to them. Although management believes that its expectations, which are reflected in the forward-looking statements, are reasonable, the Company can give no assurance that these expectations will be attained or achieved. Furthermore, actual results may differ materially from those described in the forward-looking statements and will be affected by a variety of risks and factors that are beyond the control of the Company, including, without limitation, the application of applicable accounting procedures and adjustments, independent auditor review of the Company’s preliminary financial results, developments that may arise between the date of this Current Report on Form 8-K, including this Exhibit 99.1, and the time that the Company’s financial results for the quarter and year ended December 31, 2015 are finalized, and other risks and uncertainties discussed in Constant Contact’s filings with the Securities and Exchange Commission (“SEC”), including the “Risk Factors” sections of Constant Contact’s most recent Quarterly Report on Form 10-Q for the period ended September 30, 2015 and most recent Annual Report on Form 10-K for the year ended December 31, 2014, which are available on the SEC’s website at www.sec.gov. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Constant Contact does not assume any obligation to update any forward-looking statements included in this Exhibit 99.1 as a result of new information, future events or otherwise.