<PAGE>
Filed by Chordiant Software, Inc.
Pursuant to Rule 425 under the Securities Act of 1933
And deemed filed pursuant to Rule 14a-12 of the
Securities Exchange Act of 1934
Subject Company: Prime Response, Inc.
Commission File No. 000-28873
For Immediate Release
Chordiant Software To Acquire PrimeResponse
Acquisition Would Create Real-Time Marketing, Servicing and Collaboration
For Financial Services, Banking, Communications, Travel and Consumer Markets
CUPERTINO, Calif., and CAMBRIDGE, Mass. -- January 8, 2001 - Chordiant Software,
Inc. (NASDAQ: CHRD), a leading developer of Unified CRM (Customer Relationship
Management) Solutions, today announced that it has signed a definitive agreement
to acquire Prime Response, Inc. (NASDAQ, EASDAQ: PRME), a leader in business-to-
consumer relationship marketing. The combined company would be called Chordiant
Software, Inc., and its common stock would trade on the NASDAQ National Market
under the ticker symbol CHRD.
Under the terms of the agreement, each share of common stock of
PrimeResponse would convert into 0.60 of a share of Chordiant common stock.
Chordiant expects to issue approximately 12.3 million new shares of common stock
in the transaction--valued at approximately $33 million, based on the closing
price of its common stock on January 5, 2001--and assume options and warrants to
acquire approximately 1.5 million additional shares. Sam Spadafora, chairman and
chief executive officer of Chordiant, would continue in these positions, and a
director designated by PrimeResponse will join the Chordiant board of directors.
The acquisition is expected to be accounted for as a purchase and is
intended to be tax-free to the stockholders of both companies. Completion of
the transaction is subject to customary closing conditions, including approval
by the respective stockholders of
-1-
<PAGE>
Chordiant and PrimeResponse and the receipt of regulatory approvals. Chordiant
expects to complete the transaction by early in the second quarter of 2001.
The combined revenues and cash balances of the two companies for the
three quarters ended September 30, 2000 were $45.5 million and $98.5 million,
respectively. As of September 30, Chordiant had approximately 235 employees
and PrimeResponse had approximately 225 employees. As a result of the
transaction, Chordiant expects to have more than 100 global Fortune 1000
customers, strategic partners and eBusiness integrators, as well as numerous
relationships with leading hardware and software developers - making the
combined company one of the most significant CRM software providers in the
industry.
The combined company would have a global corporate structure with
geographic coverage in the U.S. in Cambridge, MA, and Cupertino, CA, Chicago,
New York, Lakewood, CO, and Irving, TX; in Europe in London, Paris, Amsterdam,
Munich, and Frankfurt; and in the Asia-Pacific region in Melbourne, Sydney and
Singapore.
The combined company expects to benefit from opportunities through existing
relationships with more than 100 major corporations worldwide. The global
customer base demonstrates combined strength in specific vertical markets such
as banking, travel, telecommunications, financial services and consumer markets
and would include customers such as: Allianz, AXA, Barclays Mercantile, British
Telecom, CIBC, CVS, Deutsche Bank, Direct Line Financial Services, DLJdirect,
E*TRADE, First USA Bank, OnStar - a division of General Motors, Halifax Card
Services, Lloyds TSB, MetLife, priceline.com, Principal Financial, Quick &
Reilly - a unit of FleetBoston Financial Corp., The Royal Bank of Scotland,
Wachovia and 1-800-Flowers.
During the first quarter of 2001, PrimeResponse plans to streamline and
restructure operations in an effort to improve operating margins and reduce
overall expenses. This restructuring is expected to include a reduction of
employee headcount through layoffs and attrition, and the closing of several
regional offices. PrimeResponse expects to recognize a one-time restructuring
charge in the first quarter of 2001.
Allen Swann, current president of international operations for
PrimeResponse, will now assume responsibility for its worldwide field
operations. PrimeResponse has also accepted the resignations of Paul Lavallee,
president of the Americas, and James Carling, chief technical officer, effective
January 12, 2001.
-2-
<PAGE>
Chordiant and PrimeResponse's Strategic Vision
Together, Chordiant and PrimeResponse would offer the leading Unified CRM
Infrastructure software, service and relationship marketing applications. The
combined company would serve the largest business-to-consumer companies to
address their extreme customer requirements for intelligent customer
communications, marketing campaigns, offers and service.
"The acquisition would further Chordiant's stated mission to provide the
most complete Unified CRM Solution that services millions of individual
customers," said Sam Spadafora, chairman and CEO of Chordiant. "Our customers
and prospects have an absolute imperative to `play-to-win' in their markets by
leveraging their service and marketing business processes and expertise."
"PrimeResponse has focused exclusively on serving the extreme demands of
global consumer companies that need to maximize their Return-On-Marketing and
drive increased customer acquisition and retention in a Real-time marketing
environment," said Peter J. Boni, president and CEO of PrimeResponse. "The
vision, technology and anticipated cultural fit with Chordiant would create a
formidable combination with which our customers can extend their Unified CRM
solution."
Customer Benefits
Chordiant and PrimeResponse would create a broad solution across business-
to-consumer vertical markets, and unify eService, eMarketing and eBusiness
functionality for Real-time applications. The combined company expects to be
positioned as one of the premier providers of customer acquisition, retention,
relationship management, and CRM infrastructure software for intelligent
communications.
Spadafora added, "We believe that the combined company will be positioned
to lead the convergence of analytical CRM, operational CRM and collaborative
CRM into what META Group calls the `CRM Ecosystem.'" According to META Group,
a leading technology market research firm, the benefits of the CRM Ecosystem
are realized through the integration of these three areas for Real-time
customer acquisition, offer optimization, retention, and multi-channel
servicing.
-3-
<PAGE>
Teleconference and Webcast
The management of Chordiant and PrimeResponse will hold a teleconference
to discuss the planned acquisition at 1:45 p.m. PT / 4:45 ET today. All
investors can access the live call at 719-457-2618, code #515883 (please call
approximately 10 minutes before the teleconference is scheduled to begin) or
the live Webcast at http://investor.chordiant.com/medialist.cfm. A telephonic
--------------------------------------------
replay will be available for seven days after the call and the Webcast will be
archived on the Chordiant Web site for the same period.
-4-
<PAGE>
About Chordiant Software, Inc.
Chordiant delivers a Unified CRM Solution for companies with extreme
customer demands. Designed as a customer-centric solution, Chordiant Unified
CRM Solution provides an intelligent multi-channel response for customers -
whether communicating by email, Web, telephone, or wireless access, or in
person at branch offices. It includes built-in support for voice, data and
Internet integration, as well as a comprehensive workflow engine, which allows
companies to implement best business practices across multiple touchpoints.
Chordiant empowers high-value contacts designed to consistently retain
customers, grow revenue and drive profits during every contact. Headquartered
in Cupertino, California, Chordiant maintains regional offices in Chicago,
Dallas, New York, London, Amsterdam, and Munich.
About Prime Response, Inc.
PrimeResponse is publicly traded on NASDAQ and EASDAQ under the symbol
PRME. PrimeResponse customers maximize their marketing investment using
the Prime@Vantage(TM) relationship marketing suite. This integrated solution
helps marketers build closer relationships with each customer to increase
their satisfaction, boost retention and grow lifetime value. With
Prime@Vantage(TM), marketers easily create, execute and refine sophisticated
direct marketing initiatives that span traditional channels (direct mail, call
centers and advertising) as well as the latest electronic channels (Web, e-
mail and wireless.).
Headquartered in Cambridge, Massachusetts, with offices around the globe,
PrimeResponse works with many of the world's leading companies. Partners
include Accenture (formerly known as Andersen Consulting), Business Objects,
Chordiant, Clarify, DataMentors Inc., eBusiness Advantage, Fair, Isaac, Hewlett-
Packard, IBM, MarketSoft, MarketSwitch, McCann Relationship Marketing Worldwide,
Mphasis-BFL, NetGenesis, Quadstone, Quaero, SPSS, Sun Microsystems, and Viador.
This press release includes "forward-looking statements" that are subject
to risks, uncertainties and other factors that could cause actual results or
outcomes to differ materially from those contemplated by the forward-looking
statements. For this purpose, any statements contained in this press release
that are not statements of historical fact
-5-
<PAGE>
may be deemed to be forward-looking statements. Words such as "believes,"
"anticipates," "plans," "expects," "will," "would," and similar expressions
are intended to identify forward-looking statements. There are a number of
important factors that could cause the results of Chordiant or PrimeResponse
to differ materially from those indicated by these forward-looking statements,
including, among others, risks detailed from time to time in the companies'
respective Securities and Exchange Commission reports, including each
company's Quarterly Report on Form 10-Q for the quarter ended September 30,
2000, PrimeResponse's final prospectus for its initial public offering filed
on March 3, 2000 and Chordiant's final prospectus for its initial public
offering filed on February 15, 2000. Factors that could cause or contribute to
such differences include, but are not limited to, risks related to customer
and market acceptance of our products, deployment delays or errors associated
with these products, hardware platform incompatibilities, reliance on a
limited number of customers for a majority of revenue, need to maintain and
enhance certain business relationships with application integrators and other
parties, ability to manage growth, activities by the two companies and others
regarding protection of proprietary information, release of competitive
products and other actions by competitors, and economic downturns in either
domestic or international markets. Additional factors that could cause or
contribute to such differences include, but are not limited to, risks relating
to the consummation of the contemplated acquisition transaction, including the
risk that required stockholder approvals or regulatory clearances might not be
obtained in a timely manner or at all. In addition, statements in this press
release relating to the expected benefits of the contemplated acquisition
transaction are subject to risks relating to the timing and successful
completion of technology and product development efforts, integration of the
technologies and business of Chordiant and PrimeResponse, unanticipated
expenditures, changing relationships with customers, suppliers and strategic
partners and other factors described in both the reports listed above and
other periodic reports filed by Chordiant and PrimeResponse with the
Securities and Exchange Commission.
Additional Information and Where to Find It
Chordiant plans to file a registration statement on SEC Form S-4 in
connection with the acquisition, and Chordiant and PrimeResponse expect to mail
a joint proxy statement/prospectus to the stockholders of Chordiant and
PrimeResponse containing information about the transaction. Investors and
security holders of both Chordiant and PrimeResponse are advised to read the
joint proxy statement/prospectus regarding the potential business combination
transaction referred to above, when it becomes available, because it will
contain important information. The registration statement would be filed with
the Securities and Exchange Commission by Chordiant, and the joint proxy
statement/prospectus would be filed with the Securities and Exchange Commission
by both companies. Investors and security holders may obtain a free copy of the
registration statement and joint proxy statement/prospectus from commercial
document-retrieval services and at the Securities and Exchange Commission's web
site at http://www.sec.gov. Free copies of the registration statement and joint
------------------
proxy statement/prospectus may also be obtained from Chordiant by directing a
request through the Investors section of Chordiant's website at
http://www.chordiant.com; or by mail to
-------------------------
-6-
<PAGE>
Chordiant Software, Inc., 20400 Stevens Creek Boulevard, Suite 400, Cupertino,
CA 95014, attention: Investor Relations, telephone: (408) 517-6290. Free
----
copies of the joint proxy statement/prospectus may also be obtained from
----------------------------------------------
PrimeResponse by directing a request through the Investor Relations section of
PrimeResponse's website at http://www.primeresponse.com; or by mail to
-----------------------------
PrimeResponse, Inc., 150 CambridgePark Drive, Cambridge, MA 02140, attention
Investor Relations, telephone: (617) 876-8300.
In addition to the registration statement and joint proxy
statement/prospectus, Chordiant and PrimeResponse file annual, quarterly and
special reports, proxy statements and other information with the Securities
and Exchange Commission. You may read and copy any reports, statements or
other information filed by Chordiant or PrimeResponse at the SEC public
reference rooms at 450 Fifth Street, N.W., Washington, D.C. 20549 or at
any of the Commission's other public reference rooms in New York, New York and
Chicago, Illinois. Please call the Commission at 1-800-SEC-0330 for further
information on the public reference rooms. Chordiant's and PrimeResponse's
filings with the Commission are also available to the public from commercial
document-retrieval services and at the website maintained by the Commission at
http://www.sec.gov. The documents may also be obtained from Chordiant or
-------------------
PrimeResponse by directing such requests to the companies.
Interests of Certain Persons in the Merger
PrimeResponse will be, and certain other persons named below may be,
soliciting proxies from PrimeResponse stockholders in favor of the adoption of
the acquisition agreement. In addition, Chordiant will be, and certain other
persons named below may be, soliciting proxies from Chordiant stockholders in
favor of the issuance of common stock pursuant to the agreement. The directors
and executive officers of PrimeResponse and the directors and executive officers
of Chordiant may be deemed to be participants in each other's solicitation of
proxies.
The following are the directors and executive officers of PrimeResponse:
Peter J. Boni, James Carling, Frederick H. Phillips, Paul Lavallee, Allen Swann,
Gary Daniels, Jim Plantan, Terence J. Osborne, William Ford, Stephen Gal, Marc
McMorris and William Wyman.
The following are the directors and executive officers of Chordiant: Sam
Spadafora, Stephen Kelly, Don Morrison, Joseph Tumminaro, Cary Morgan, Oliver D.
Curme, Kathryn Gould, Mitchell Kertzman, Robert McKinney, Bill Raduchel, Carol
Realini, and David Springett.
The directors and executive officers of PrimeResponse have interests in the
transaction, some of which may differ from, or may be in addition to, those of
PrimeResponse's stockholders generally. Those interests include the following:
-7-
<PAGE>
- As of January 8, 2001, the directors and executive officers of
PrimeResponse, as a group, may be deemed to beneficially own
approximately 75% of PrimeResponse's outstanding common stock
- In connection with the signing of the agreement, certain executive
officers will enter into employment or consulting agreements with
PrimeResponse
- Upon completion of the transaction, a director of PrimeResponse will
become a director of Chordiant
- Certain directors and executive officers of PrimeResponse may own
options to purchase shares of PrimeResponse common stock which will
become vested and exercisable in connection with the transaction
- Certain directors and executive officers of PrimeResponse may have
severance agreements that may be triggered in connection with the
transaction
- Chordiant has agreed to provide indemnification and director and
officer liability insurance coverage to the directors and executive
officers of PrimeResponse following the acquisition.
For More Information Contact:
James Strohecker Tom Walsh
Chordiant Software, Inc. Marenghi Public Relations
+1 408-517-6191 +1 781-915-5021
[email protected] [email protected]
------------------------------ -------------------
Darren Horwitz Ronny Nicholas
Prime Response, Inc. Prime Response, Inc.
+1 415-844-3104 + 44 (0) 208 5800 0330
[email protected] [email protected]
-------------------------- ---------------------------
For Chordiant European information, please contact:
Neil Morgan Alison Stokes
Chordiant Software, Inc. Brodeur Public Relations UK
+ 44 (0) 20 7382 5000 + 44 (0) 17 5379 0700
[email protected] [email protected]
------------------------- ----------------------
# # #
Chordiant and the Chordiant logo are registered trademarks of Chordiant
Software, Inc. Chordiant Unified CRM for Extreme Demands are trademarks of
Chordiant Software, Inc. PrimeResponse, Prime@Vantage, Prime@Vantage Wireless,
[email protected] and Marketing Mission Control are trademarks and/or registered
trademarks of Prime Response, Inc. All other trademarks and registered
trademarks are the properties of their respective owners.
-8-
