DEFA14A: Innovid Corp. Addresses Stockholder Lawsuits, Provides Additional Merger Details

Innovid Corp. files an 8-K report addressing stockholder lawsuits related to its merger with Mediaocean LLC and provides supplemental information to its proxy statement.

Summary

• Innovid Corp. has filed a Form 8-K report addressing demand letters and stockholder actions related to its proposed merger with Mediaocean LLC.
• The company believes the allegations of disclosure deficiencies in the proxy statement are without merit but is providing supplemental disclosures to avoid delays and minimize expenses.
• The supplemental disclosures relate to the background of the merger, reasons for the merger, and the fairness opinion of Innovid's financial advisor, Evercore.
• Two complaints, Richard Williams v. Innovid Corp. et al. and Philip Stone v. Innovid Corp. et al., have been filed in New York state courts, alleging negligent misrepresentation and concealment, as well as negligence under New York common law.
• The lawsuits seek injunctive relief, unspecified damages, and attorneys' fees.
• Innovid reaffirms its belief that the proxy statement complies with applicable law.
• The company cautions that forward-looking statements are subject to risks and uncertainties, and actual results may differ materially.

Sentiment

Score: 5

Explanation: The document is primarily a legal and financial disclosure related to a pending merger. While it addresses potential risks and litigation, it also expresses confidence in the merger's prospects. The sentiment is neutral overall.

Positives

• Innovid is proactively addressing stockholder concerns to facilitate the merger.
• The company is providing additional information to enhance transparency.
• Innovid believes the lawsuits are without merit.

Negatives

• Stockholder lawsuits have been filed, alleging disclosure deficiencies.
• The lawsuits could potentially delay the merger and incur expenses for Innovid.
• The outcome of the Stockholder Actions and their impact on Innovid or the Merger cannot be predicted.

Risks

• Potential litigation relating to the Merger could be instituted against Innovid, Parent or their respective directors, managers or officers, including the effects of any outcomes related thereto.
• Disruptions from the Merger will harm Innovids business, including current plans and operations.
• Innovid's ability to retain and hire key personnel may be impacted.
• Adverse reactions or changes to business relationships resulting from the announcement or completion of the Merger.
• Business uncertainty, including changes to existing business relationships, during the pendency of the Merger that could affect Innovids financial performance.
• Restrictions during the pendency of the Merger may impact Innovids ability to pursue certain business opportunities or strategic transactions.
• The Merger may be more expensive to complete than anticipated.
• The occurrence of any event, change or other circumstance that could give rise to the termination of the Merger Agreement, including in circumstances requiring Innovid to pay a termination fee.
• Competitive responses to the Merger.

Future Outlook

The document contains forward-looking statements regarding the completion of the merger, potential litigation, business disruptions, and other risks and uncertainties. Actual results may differ materially from those expressed or implied in the forward-looking statements.

Management Comments

• Innovid believes that the allegations contained in the Demand Letters and Stockholder Actions are without merit.
• Innovid believes that no supplemental disclosures are required under applicable laws.

Industry Context

The document references comparable companies in the media and non-media ad-tech industry, including LiveRamp, Double Verify, The Trade Desk, and others, to provide context for the fairness opinion of Innovid's financial advisor.

Comparison to Industry Standards

• Evercore compared Innovid to selected publicly traded companies in the media and non-media ad-tech industry, including LiveRamp, Double Verify, Inc., IAS Corp, The Trade Desk, Inc., Zeta Corp., Viant, Inc., Nexxen Ltd., Magnite, Inc., Taboola Ltd., PubMatic, Inc., Outbrain, Inc., Criteo S.A., AppLovin Corp., Unity, Inc., Digital Turbine, Inc., and Roku, Inc.
• The analysis included financial multiples and ratios such as 2024 and 2025 EV/Adjusted EBITDA and EV/Revenue.
• Evercore reviewed selected transactions involving target companies in the ad-tech industry announced since 2016, including Golden Gate Capital LP's acquisition of Neustar, Inc. and Vista, Inc.'s acquisition of IAS Corp.
• The selected transactions had a mean EV/LTM Revenue of 4.5x and a median of 3.0x.

Legal Proceedings

• Two complaints have been filed by purported Innovid stockholders against Innovid and members of its board of directors in connection with the Merger Agreement and the transactions contemplated thereby.
• The two complaints are filed in New York state courts and captioned as Richard Williams v. Innovid Corp. et al. and Philip Stone v. Innovid Corp. et al., which Innovid refers to collectively as the Stockholder Actions.
• In general, the Stockholder Actions claim negligent misrepresentation and concealment as well as negligence under New York common law and allege that the Proxy Statement omits or misstates material information.
• The Stockholder Actions seek, among other things, injunctive relief preventing the consummation of the Merger, unspecified damages, and attorneys fees.

Stakeholder Impact

• The merger will impact Innovid's stockholders, who will vote on the Merger Agreement.
• The merger could affect Innovid's employees, customers, and business relationships.
• Potential adverse reactions or changes to business relationships resulting from the announcement or completion of the Merger.

Next Steps

• The Special Meeting of Stockholders will be held on February 11, 2025, to vote on the Merger Agreement.
• Innovid's stockholders are advised to consult any future disclosures that Innovid makes on related subjects as may be detailed in its other filings made from time to time with the SEC.

Key Dates

Keywords

Merger, Innovid, Mediaocean, Proxy Statement, Stockholder Lawsuits, Disclosure, Acquisition, Ad-Tech