Outbrain Inc. Files 8-K with Multiple Material Events

TL;DR

Outbrain filed an 8-K detailing major corporate events, financial obligations, and executive changes.

AI Summary

Outbrain Inc. filed an 8-K on February 3, 2025, reporting several material events. These include the entry into and termination of material definitive agreements, completion of asset acquisitions or dispositions, and updates on results of operations and financial condition. The filing also details the creation of financial obligations, costs associated with exit activities, unregistered sales of equity securities, and changes in officers and directors, along with compensatory arrangements. Additionally, it covers amendments to articles of incorporation, changes in fiscal year, and Regulation FD disclosures, accompanied by financial statements and exhibits.

Why It Matters

This 8-K filing indicates significant corporate actions and financial events for Outbrain Inc., which could impact its operational strategy, financial health, and stock performance.

Risk Assessment

Risk Level: medium — The filing covers a broad range of material events, including financial obligations and asset dispositions, which inherently carry medium risk.

Key Numbers

• 1231 — Fiscal Year End (Indicates the end of Outbrain Inc.'s fiscal year for financial reporting.)

Key Players & Entities

• Outbrain Inc. (company) — Filer of the 8-K report
• 0001140361-25-002802 (document_id) — Accession number for the filing
• 20250203 (date) — Date of report and earliest event
• 111 WEST 19TH STREET (address) — Business and mailing address of Outbrain Inc.
• NEW YORK (location) — City for business and mailing address
• NY (location) — State for business and mailing address
• 10011 (zip_code) — ZIP code for business and mailing address
• (646) 867-0149 (phone_number) — Business phone number for Outbrain Inc.
• 001-40643 (sec_file_number) — SEC file number for Outbrain Inc.
• 25580745 (film_number) — Film number for the filing

FAQ

Key Financial Figures

• $0.001 — ich registered Common stock, par value $0.001 per share OB The Nasdaq Stock Marke
• $725 m — Acquisition was: (a) a cash payment of $725 million, subject to certain customary adj
• $25 m — ent from Outbrain in an amount equal to $25 million, payable after the closing of the
• $625 m — Acquisition was: (a) a cash payment of $625 million, subject to certain customary adj
• $100,000,000 — ity in an aggregate principal amount of $100,000,000 (the "Revolving Facility") and (b) a se
• $625,000,000 — ity in an aggregate principal amount of $625,000,000 (the "Bridge Facility" and, together wi
• $10,000,000 — he Springing RCF Maturity Date. Up to $10,000,000 of the Revolving Facility is available
• $20,000,000 — the form of letters of credit and up to $20,000,000 of the Revolving Facility is available
• $62,500,000 — rincipal amount equal to the greater of $62,500,000 and 25% of the Company's EBITDA (as def
• $617,435 — Revenue $ 188,953 $ 219,393 $ $617,435 $ $649,812 Traffic acquisition cost
• $649,812 — 188,953 $ 219,393 $ $617,435 $ $649,812 Traffic acquisition costs (69,091) (
• $28.1 million — 30, 2024, Teads recorded an expense of $28.1 million. Combined Company Preliminary Estimate
• $1,507.3 m — ain expects revenue to be approximately $1,507.3 million, Ex-TAC Gross Profit to be approx
• $622.7 million — Ex-TAC Gross Profit to be approximately $622.7 million and Adjusted EBITDA to be approximately
• $160.0 million — and Adjusted EBITDA to be approximately $160.0 million. The Company updated its previous guid

Filing Documents

• ny20037354x5_8k.htm (8-K) — 180KB
• ny20037354x5_ex2-1.htm (EX-2.1) — 306KB
• ny20037354x5_ex3-1.htm (EX-3.1) — 92KB
• ny20037354x5_ex4-1.htm (EX-4.1) — 103KB
• ny20037354x5_ex10-1.htm (EX-10.1) — 1563KB
• ny20037354x5_ex10-2.htm (EX-10.2) — 108KB
• ny20037354x5_ex10-3.htm (EX-10.3) — 121KB
• ny20037354x5_ex99-1.htm (EX-99.1) — 55KB
• ny20037354x5_ex99-1a.jpg (GRAPHIC) — 105KB
• ny20037354x5_ex99-1b.jpg (GRAPHIC) — 197KB
• 0001140361-25-002802.txt ( ) — 3628KB
• ob-20250203.xsd (EX-101.SCH) — 4KB
• ob-20250203_lab.xml (EX-101.LAB) — 23KB
• ob-20250203_pre.xml (EX-101.PRE) — 17KB
• ny20037354x5_8k_htm.xml (XML) — 4KB

01

Item 1.01. Entry into a Material Definitive Agreement. Amendment of the Share Purchase Agreement On August 1, 2024, Outbrain entered into a Share Purchase Agreement (the "Share Purchase Agreement") with Teads and Altice Teads S.A., to acquire all of the issued and outstanding equity interests of Teads from Altice Teads. Under the terms of the Share Purchase Agreement, the consideration to be paid at the closing of the Acquisition was: (a) a cash payment of $725 million, subject to certain customary adjustments; (b) 35 million newly issued shares of common stock, par value $0.001 per share, of Outbrain (the "Common Stock") and (c) 10.5 million newly issued Series A Convertible Preferred Shares, par value $0.001 per share, of Outbrain (the "Preferred Stock"). Additionally, Altice Teads was entitled to a deferred cash payment from Outbrain in an amount equal to $25 million, payable after the closing of the Acquisition in one or more installments, to the extent permitted to be paid in compliance with the covenants under the debt financing agreements entered into by Outbrain in connection with the Acquisition (the "Deferred Payment"). On February 3, 2025, the parties entered into Amendment Number 1 to the Share Purchase Agreement (the "SPA Amendment"). Under the SPA Amendment, the consideration paid at the closing of the Acquisition was: (a) a cash payment of $625 million, subject to certain customary adjustments; and (b) 43.75 million shares of Common Stock. The parties also agreed to make certain changes to the forms of Stockholder Agreement and Registration Rights Agreement originally attached to the Share Purchase Agreement to reflect the elimination of the creation and issuance of the Preferred Stock, as well as the elimination of the Deferred Payment. The foregoing description of the SPA Amendment does not purport to be complete and is qualified in its entirety by reference to the text of the SPA Amendment, a copy of which is filed as Exhibit 2.1 to this Cur

02

Item 1.02. Termination of a Material Definitive Agreement. On the Credit Facilities Closing Date, in connection with the entry into the Credit Agreement described above, the Company repaid in full all indebtedness and other obligations outstanding under, and terminated, the Second Amended and Restated Loan and Security Agreement, dated as of November 2, 2021, by and among the Company, Silicon Valley Bank, a division of First-Citizens Bank & Trust Company, Zemanta Holding USA Inc. and Zemanta Inc. (as amended, modified, supplemented or restated from time to time, the "2021 Loan Agreement").

01

Item 2.01. Completion of Acquisition or Disposition of Assets. On February 3, 2025, the parties consummated the closing of the Acquisition on the terms contemplated by the Share Purchase Agreement, as amended by the SPA Amendment. The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.01.

02

Item 2.02. Results of Operations and Financial Condition. On February 3, 2025, the Company announced select preliminary results for the fourth quarter and year ended December 31, 2024, which are included in the press release furnished as Exhibit 99.1 hereto and are incorporated herein by reference. Preliminary Estimated Unaudited Financial Information for the Quarter and Year Ended December 31, 2024. Set forth below is selected preliminary estimated unaudited financial information for each of Outbrain and Teads on a standalone basis and on a combined company basis for the quarter and year ended December 31, 2024. These estimates have been prepared by, and are the responsibility of, management. Outbrain's independent auditor, KPMG LLP, have not reviewed the Outbrain preliminary financial information nor has it performed any procedures with respect to the Outbrain preliminary financial information. Teads' independent auditor, Deloitte Audit S. r.l., have not reviewed the Teads preliminary financial information nor has it performed any procedures with respect to the Teads preliminary financial information. The combined company preliminary financial information represents the summation of the standalone preliminary financial information prepared by Outbrain in accordance with U.S. GAAP and the standalone preliminary financial information prepared by Teads in accordance with IFRS. This combined company preliminary financial information has not been prepared in accordance with Article 11 of Regulation S-X and does not give effect to the pro forma adjustments required in connection with the preparation of pro forma financial information in accordance with Article 11 of Regulation S-X, including conversion from IFRS to U.S. GAAP, and is not indicative of what the combined company's performance would have been had Outbrain and Teads been a combined company for the periods presented under U.S. GAAP. As a result, the combined company preliminary financial information pre

03

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. The information disclosed in this Current Report under Item 1.01 under the heading " Credit Agreement " is incorporated into this Item 2.03 by reference to the extent required.

05

Item 2.05. Costs Associated with Exit or Disposal Activities. On February 3, 2025, in connection with the completion of the Acquisition, the Company announced a restructuring plan (the "Plan"), involving a reduction in workforce, as part of its efforts to streamline operations and reduce duplication of roles. The Company estimates that it will incur approximately $20 million to $25 million in charges in connection with the Plan, of which approximately $18 million to $24 million is expected to be incurred in 2025. These charges consist primarily of severance payments. The actions associated with the employee restructuring under the Plan are expected to be initiated the week of February 3, 2025, implemented in large part by the second quarter of 2025 and completed by the first quarter of 2026. The estimates of the charges and expenditures that the Company expects to incur in connection with the Plan, and the timing thereof, are In addition, the Company may incur other charges or cash expenditures not currently contemplated due to unanticipated events that may occur, including in connection with the implementation of the Plan.

02

Item 3.02 Unregistered Sales of Equity Securities. The information set forth in Item 2.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02. The Common Stock was issued in reliance upon the exemption from the registration requirements of the Securities Act, provided by Section 4(a)(2) thereof as a transaction by an issuer not involving any public offering.

02

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. Board of Directors The Company anticipates the appointment of two additional new directors to the Company's board of directors (the "Board") following the Acquisition Closing Date. See Item 5.03 below.

03

Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year In connection with the contemplated appointment of two designees of Altice Teads to the Board, the Board approved an amendment to the Company's Amended and Restated Bylaws (as so amended, the "Amended Bylaws"), effective as of such date, to increase the authorized number of directors from nine to 11, as set forth in Article II Section 1 of the Amended Bylaws. A copy of the Amended Bylaws is attached hereto as Exhibit 3.1.

01

Item 7.01. Regulation FD Disclosure. On February 3, 2025, the Company issued a press release announcing, among other things, the completion of the Acquisition. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein. In addition, on or after February 3, 2025, certain of the following information may be shared with investors: Acquisition Synergies The Company previously announced its expectation to achieve $50 – 60 million of annual revenue and cost synergies in the second full year following completion of the Acquisition, with further opportunities for expanded synergies in the following years. The Company now expects to realize approximately $65 – 75 million of annual synergies in fiscal year 2026, with further opportunities for expanded synergies in the following years. Of this amount, approximately $60 million relates to cost synergies, including approximately $45 million of compensation related expenses. The Company plans to action approximately 70% of the compensation related expense savings during the first month post-closing. The upsize in expected synergies follows a robust integration planning process, enabling a larger and more rapid synergy capture. Principal Drivers of the Preliminary Estimated Unaudited Financial Information for the Quarter and Year Ended December 31, 2024 Outbrain For the three months ended December 31, 2024, Outbrain expects revenue to be approximately $234.6 million, compared to $248.2 million for the three months ended December 31, 2023. For the fiscal year ended December 31, 2024, Outbrain expects revenue to be approximately $889.9 million, compared to $935.8 million for the fiscal year ended December 31, 2023. These expected decreases are primarily due to experiencing lower ad impressions from certain supply partners, partially offset by growth from adding new media partners. For the three months ended December 31, 2024, Outbrain expects Ex-TAC Gross Profit to be approximate

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View this 8-K filing on SEC EDGAR