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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): September 23, 1999
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Engage Technologies, Inc.
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(Exact Name of Registrant as Specified in its Charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
000-1084573 04-3281378
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(Commission File Number) (I.R.S. Employer Identification No.)
100 Brickstone Square
Andover, Massachusetts 01810
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(Address of Principal Executive Offices) (Zip Code)
(978) 684-3884
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(Registrant's Telephone Number, Including Area Code)
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(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. OTHER EVENTS.
On September 23, 1999, Engage Technologies, Inc., a Delaware corporation
("Engage"), CMGI, Inc., a Delaware corporation and the majority stockholder of
Engage ("CMGI"), AK Acquisition Corp., a California corporation and a wholly-
owned subsidiary of CMGI ("Transitory Subsidiary"), AdKnowledge Inc., a
California corporation ("AdKnowledge"), a provider of products and services
which allow online marketers and ad agencies to plan, target, serve, track and
analyze advertising campaigns, and Steve Findley, John Mracek and Kevin Wandryk
(collectively, the "Shareholder Representative") executed an Agreement and Plan
of Merger and Contribution (the "Merger Agreement"). Upon the completion of the
transactions contemplated by the Merger Agreement, AdKnowledge will become a
wholly-owned subsidiary of Engage. The Merger Agreement contemplates:
First, a merger of Transitory Subsidiary with and into AdKnowledge,
with AdKnowledge being the surviving corporation (the "Surviving
Corporation"). In this merger, all the AdKnowledge preferred shareholders
will receive an aggregate of approximately $170,000,000 of CMGI common
stock and a new class of AdKnowledge common stock ("Surviving Corporation
Common Stock"), and all common shareholders of AdKnowledge will receive
shares of Surviving Corporation Common Stock. The value of the CMGI common
stock being delivered is based upon $84.80, the average of the last
reported sales prices of the CMGI common stock over the 45 consecutive
trading days ending on September 20, 1999, which value may be adjusted
upward by up to 10% or downward by up to 10% based upon the average of the
last reported sales prices of such stock over the 45 consecutive trading
days ending two trading days prior to the effective time of this merger.
Upon completion of this merger, CMGI will own approximately 88% of the
Surviving Corporation Common Stock.
Second, CMGI and other shareholders of Surviving Corporation will
contribute their Surviving Corporation Common Stock to Engage in exchange
for approximately $193,000,000 of Engage's common stock. The value of the
Engage common stock being delivered is $31.45, the average of the last
reported sales prices of the Engage common stock over the 44 consecutive
trading days ending on September 20, 1999, and may be adjusted upward or
downward in the same manner as the CMGI stock described above.
Third, Engage will consummate a California short-form merger between
Surviving Corporation and a wholly-owned subsidiary of Engage ("Engage
Sub"), pursuant to which Engage Sub will merge with and into Surviving
Corporation, with Surviving Corporation being the surviving corporation in
such merger. Any remaining holders of Surviving Corporation Common Stock
will receive Engage's common stock in this merger.
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The transactions are intended to be tax free under Section 368(a) and
Section 351 of the Internal Revenue Code of 1986, as amended, and to be
accounted for as a purchase.
The transactions described have been approved by the boards of directors of
Engage, CMGI and AdKnowledge and remain subject to regulatory approvals, the
approval of the stockholders of Engage and AdKnowledge and other customary
closing conditions. Certain affiliates of AdKnowledge representing a significant
percentage of AdKnowledge common and preferred stock have agreed to vote in
favor of the transactions.
The full text of Engage's press release issued in connection with the
foregoing matters is filed as Exhibit 99.1 to this Current Report on Form 8-K
and is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits.
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99.1 Press Release
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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.
Date: October 4, 1999 ENGAGE TECHNOLOGIES, INC.
(Registrant)
By: /s/Paul L. Schaut
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Paul L. Schaut
President and Chief
Executive Officer
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EXHIBIT INDEX
Exhibit
Number Description
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99.1 Press Release
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Exhibit 99.1
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<CAPTION>
CONTACTS:
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Kathleen Kreis Tom Barth Michele Schott
Engage PR Engage IR AdKnowledge
919-872-7755 x3241 978-247-5310 650-842-6502
[email protected] [email protected] [email protected]
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</TABLE>
ENGAGE TO ACQUIRE ADKNOWLEDGE TO
IMPROVE ONLINE MARKETING EFFECTIVENESS
Combined company to provide online marketers and ad agencies with a set of
comprehensive, profile based analysis and targeting tools
ANDOVER, MA, SEPTEMBER 23, 1999 - Engage Technologies, Inc. (Nasdaq: ENGA), a
leading provider of profile driven Internet marketing solutions and a majority-
owned operating company of CMGI, Inc. (Nasdaq: CMGI), today announced it has
signed a definitive agreement to acquire AdKnowledge Inc., a leading provider of
complete Web marketing management services focused entirely on the needs of
online marketers and agencies, in an all stock transaction valued at
approximately $193 million.
This transaction combines the vision of both companies to provide online
marketers and agencies with products and services that increase the
effectiveness of their marketing efforts. AdKnowledge's relationships with many
online marketers and agencies, including some of the most sophisticated and
influential in the marketplace, will accelerate the use of Engage's profile
based targeting as an effective alternative to content based targeting.
(MORE)
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ENGAGE TO MERGE WITH ADKNOWLEDGE
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"Internet trends are being driven by the largest and most sophisticated online
marketers and their advertising agencies, many of which have strong
relationships with AdKnowledge, such as SportsLine (Nasdaq: SPLN), eBay (Nasdaq:
EBAY) and eToys (Nasdaq: ETYS) and agencies like Organic and i-Traffic," said
Paul Schaut, President and CEO of Engage. "We are excited about the opportunity
to add value to these relationships by incorporating profile based ad targeting
into AdKnowledge's extensive services. This powerful combination will enable
profile based ad targeting to be more widely deployed in the industry."
By integrating Engage's profile based targeting, AdKnowledge customers will be
able to target and analyse campaigns based on profiles of their target audience.
AdKnowledge has become a widely used source for marketers targeting online
advertising. To date, nearly all such targeting has been based on content
specific ad buying. With Engage, AdKnowledge will be able to broaden its
offering to include profile based targeting to its customers.
"AdKnowledge and Engage are uniquely complementary and share the same objective
- -- to improve the effectiveness of online marketing," said Scott Kauffman, CEO
of AdKnowledge. "Integrating Engage's consumer profile data and profiling
technologies into the AdKnowledge System will create the industry's most
comprehensive suite of tools for marketers and agencies."
Additionally, the combination of Engage, AdKnowledge and Engage's I/PRO products
and services will uniquely position Engage as a leading provider of
comprehensive data analysis to marketers and agencies. Engage's profiling and
data mining capabilities help marketers profile, segment and better understand
their customers' interests and behaviors.
(MORE)
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ENGAGE TO MERGE WITH ADKNOWLEDGE
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AdKnowledge eAnalytics lets marketers fine tune those programs for maximum
effectiveness based on the real drivers of brand awareness and purchase
behavior. And I/PRO's site analysis capabilities will help marketers evaluate
the impact of their marketing efforts on site traffic and visitor behavior. By
grouping these products and services, AdKnowledge uniquely positions Engage as a
provider of data analysis capabilities.
Under the terms of the merger and contribution agreement, CMGI will initially
acquire control of AdKnowledge through the issuance of approximately $170
million of CMGI common stock, followed by a contribution of AdKnowledge shares
held by CMGI and AdKnowledge shareholders to Engage in exchange for
approximately $193 million of Engage common stock. The transaction, which will
be accounted for as a purchase, is subject to certain conditions, regulatory
approval and the shareholder approval of Engage and AdKnowledge. AdKnowledge,
which recently filed its S-1 with the SEC, is privately held and will become a
wholly-owned subsidiary of Engage. The transaction is expected to be completed
in late 1999 or early 2000.
ABOUT ADKNOWLEDGE:
AdKnowledge is a leading provider of complete Web marketing management services
focused entirely on the needs of advertising buyers. AdKnowledge combines
analytic services and data mining with outbound campaign management to provide
sophisticated marketers and agencies with insights into what drives brand
awareness and purchase behavior across all Web sites and networks. The
company's headquarters are in Palo Alto, California, with offices in New York.
For more information about AdKnowledge, contact via phone at 650-842-6500 or on
the Internet at www.adknowledge.com.
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ABOUT ENGAGE:
Engage Technologies, Inc., (Nasdaq: ENGA) a majority-owned operating company of
CMGI, Inc., (Nasdaq: CMGI), is a leading provider of profile-driven Internet
marketing solutions. Engage offers a range of software products and services
that enable Web publishers, advertisers and merchants to target and deliver
advertisements, commerce and e-commerce offerings to their audiences and to
measure their effectiveness. Engage's core product and services include Engage
Knowledge, a global database that currently
contains more than 35 million anonymous consumer profiles, and Accipiter
AdManager,
(MORE)
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ENGAGE TO MERGE WITH ADKNOWLEDGE
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an online advertising management system that automates the scheduling, targeting
and delivery of ads on Web sites and the reporting of campaign results.
Additionally, Engage offers Web traffic verification, measurement and analysis,
and research through its wholly-owned subsidiary, I/PRO. For more information
about Engage, please visit www.engage.com.
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ABOUT CMGI:
With nearly 50 companies, CMGI, Inc. (Nasdaq: CMGI) represents the largest, most
diverse network of Internet companies in the world. This network includes both
CMGI operating companies and a growing number of synergistic investments through
its venture capital affiliate, @Ventures. CMGI leverages the technologies,
content, and market reach of its extended family of companies to foster rapid
growth and industry leadership across its network, and the larger Internet
Economy. Microsoft, Intel, Sumitomo and Compaq hold minority positions in CMGI.
CMGI's majority-owned subsidiaries include Engage Technologies (Nasdaq: ENGA),
Activerse, Adsmart, AltaVista, Cha! Technologies, iCAST, Magnitude Network,
NaviSite, NaviNet, Planet Direct and ZineZone. The company's @Ventures
affiliates have ownership interests in Lycos, Inc. (Nasdaq: LCOS), Critical Path
(Nasdaq: CPTH), Silknet (Nasdaq: SILK), Chemdex (Nasdaq: CMDX), Ancestry.com,
Asimba, AuctionWatch, Aureate Media, blaxxun, BizBuyer.com, buyingedge.com,
CarParts.com, CraftShop.com, eCircles.com, EXP.com, FindLaw, Furniture.com,
HotLinks, Intelligent/Digital, KOZ.com, Mondera.com, MotherNature.com,
NextMonet.com, NextPlanetOver.com, OneCore.com, ONElist, PlanetOutdoors.com,
Productopia, Promedix.com, Raging Bull, Speech Machines, ThingWorld.com,
Vicinity, Virtual Ink, Visto and WebCT.
CMGI is also the majority-owner of SalesLink, InSolutions and On-Demand
Solutions, leaders in the direct marketing, fulfillment and turnkey arenas. CMGI
Corporate headquarters is located at 100 Brickstone Square, Andover, MA 01810.
Telephone: 978-684-3600. Fax: 978-684-3814. Additional information is available
on the company's Web site at www.cmgi.com.
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STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
Except for the historical information contained in this release, the matters
described herein contain forward-looking statements that involve risks and
uncertainties which might cause the results of such forward-looking statements
to differ materially from those anticipated. Such risks and uncertainties
include failure of the combination of Engage and AdKnowledge to realize
anticipated product offering benefits, failure of Engage or AdKnowledge products
and services to achieve customer acceptance, privacy concerns, slower than
expected growth in Internet advertising, increased competition, the timely
development of new profile-based products and services, and other risks detailed
in Engage's Registration Statement on Form S-1 declared effective on July 19,
1999 under the Securities Act of 1933.
