Get Started for Free Contexxia identifies hard-to-find pieces of information in SEC filings. No more highlighters, no more redlining, no more poring over huge documents. interclick, inc. (1378846) 10-Q published on Nov 10, 2011 at 4:07 pm
Reporting Period: Sep 29, 2011
In September 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2011-08, “Intangibles — Goodwill and Other,” (“ASU 2011-08”), which amends current guidance to allow a company to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. The amendment also improves previous guidance by expanding upon the examples of events and circumstances that an entity should consider between annual impairment tests in determining whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. ASU 2011-08 is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. Accordingly, the Company will adopt ASU 2011-08 beginning in the first quarter of fiscal year ending December 31, 2012. The impact of the adoption of ASU 2011-08 has not yet been evaluated.
On August 17, 2011, ruling on the Company’s and the advertisers’ motions to dismiss the Amended Complaint, the Court dismissed the sole remaining federal claim alleging violation of the Computer Fraud and Abuse Act and the state law claims for breach of implied contract and tortious interference with prejudice, and dismissed all claims against the advertisers with prejudice. The only remaining claims are claims against the Company for trespass to chattels and under New York’s Consumer Protection Law (General Business Law Section 349).
On November 1, 2011, the Company announced that it had entered into an Agreement and Plan of Merger, dated October 31, 2011 (the ‘’Merger Agreement”), with Yahoo! Inc. (“Yahoo”), a Delaware corporation and Innsbruck Acquisition Corporation (“Purchaser”), a Delaware corporation and a wholly-owned subsidiary of Yahoo. Pursuant to the Merger Agreement and upon the terms and subject to the conditions thereof, Purchaser will commence a tender offer (the “ Tender Offer) to acquire all the issued and outstanding shares of the common stock of the Company for $9.00 per share, net to the holder thereof in cash, without interest and subject to applicable withholding taxes. The Merger Agreement provides that, among other things, upon its terms and subjects to the satisfaction or written waiver of certain conditions, following completion of the Tender Offer, and in accordance with the applicable provisions of the Delaware General Corporation Law, Purchaser will be merged with and into the Company (the “Merger”), with the Company continuing as the surviving corporation in the Merger.
On November 8, 2011, a purported class action lawsuit was filed in the Supreme Court of the State of New York, New York County, under the caption Sam Elghanian, individually and on behalf of all others similarly situated v. interclick, inc. et al., Index No. 653101/2011. The plaintiff alleges that members of the Board of Directors breached their fiduciary duties by, amongst other things, agreeing to sell the Company for inadequate consideration. The lawsuit names the Company and the members of the Board of Directors as defendants and seeks, among other relief, an injunction over the proposed sale of the Company to Yahoo.
Other income (expense) consists primarily of interest expense, and in the prior year period, other than temporary impairment of available-for-sale securities. The decrease in other expense is primarily attributable to the absence of $126,080 in other than temporary impairment of available-for-sale securities recognized in the prior year period. The vast majority of such available-for-sale securities were sold in December 2010 and accordingly no material impairments or loss on these available-for-sale securities is expected to occur in future periods. This decrease was partially offset by an increase in interest expense to $71,019 for the three months ended September 30, 2011 from $19,429 for the three months ended September 30, 2010. This increase is primarily attributable to higher average outstanding borrowings under our current line of credit versus our former line of credit, which is partially offset with savings from more favorable borrowing rates on our current line of credit. The increase is also partially attributable to increased interest expense incurred on capitalized leases for computer equipment purchased during the second half of 2010 and during the nine months ended September 30, 2011.