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PEEK Extends Tender Offer For Looksmart Shares To January 7th

According to GlobeNewswire (and, as has been announced today, the "PEEK extended offer is to expire at 12:01 A.M., New York time, on January 7, 2013.

The tender offer was previously scheduled to expire at 5:00 P.M., New York time, on December 31, 2012.

As of December 31, 2012, 8,380,021 shares had been deposited, which, together with the shares owned by PEEK's affiliates, represents over 63% of the total shares outstanding."

I find this pretty amazing when taking into account the independent ($1.00pps Tender price) Inadequacy Opinion coming from the Co's Financial Advisor (Victory Park Securities) - when this was advised within LookSmart's initial rejection announcement, made on August 2, 2012.

"The Board believes that a proposal that does not give full value to LookSmart's cash, and no value to any other assets and opportunities, is clearly inadequate.

........In addition, the Board has taken into account the fact that, on July 29, 2012, Victory Park Securities rendered an oral opinion to the Board, subsequently confirmed in writing, that, as of the date of such opinion & based upon & subject to the factors and assumptions set forth in its written opinion, the consideration proposed to be paid to the holders of shares (other than Purchaser and its affiliates) pursuant to the Offer is inadequate from a financial point of view to such holders."

As stated, I am amazed.

Certainly when considering PEEK's December 2nd announcement advice that (as of Nov. 30, 2012), only 4,730,028 shares had been deposited and that, together with the shares owned by PEEK's affiliates, this then represented approximately 42% of the total shares outstanding.

This (today's) announcement, shows that a further 21% in the total shares outstanding, have now been deposited.

"As of December 31, 2012, 8,380,021 shares had been deposited, which, together with the shares owned by PEEK's affiliates, represents over 63% of the total shares outstanding."

Shareholders need to strongly consider Looksmart's December 20th announcement, in which they say...

.. "a [any] decision not to tender in the Offer would permit stockholders who believe the shares have a greater intrinsic value to realize greater long-term value if their view of the greater intrinsic value of the shares is recognized in the trading market.

In order to permit the stockholders to make such decisions, the Board has amended the Rights Agreement- - - dated as of August 23, 2012 between LookSmart and Computershare Trust Company, N.A. as rights agent, in order to permit PEEK to consummate the Offer on or prior to 5:00 p.m. New York City time on January 14, 2013 without triggering the [poison pill] Rights, and currently intends to approve the Offer for purposes of Section 203 of the DGCL, the "business combination" statute, to the extent that........... the Offer would result in PEEK becoming an "interested stockholder" as defined therein."

Hell... I'll be hanging on to mine, that's for sure. To me, these crooks can do as they please, it would seem?

I opined in my instapost on Sept. 13th, that:

For mine, it has been a 'game of distraction' away from the main game that's unfolding by the day and with Yahoo Finance deleting (censoring) my latest two posts it sure helps to support this, my own theory.

As always, only an opinion.

LOOK: $0.89 Down 0.0650 (-6.81%) Dec. 31, 4:00PM EST


ps; From the Co's EdgarOnline Filing (SC 14D9/A) there is reason for concern - part of which I will attempt to convey to readers:

Looksmart (in telling the PEEK story - the Offer), have advised of the following:

"During this time, LookSmart has suffered significant employee departures and customer losses.

.While the Board believes that the Offer may underestimate the value that LookSmart's assets, operations and prospects, including its market positioning and growth opportunities, could potentially deliver, the Board also believes LookSmart is currently unable to realize that potential.

As a result, the Board believes LookSmart will not be able to deliver greater value to its stockholders as an ongoing stand-alone business than the Offer Price.

The Board does intend to continue to evaluate alternatives to maximize stockholder value during the pendency of the Offer, including a sale of the company, a distribution of LookSmart's cash & sale of its remaining assets and a liquidation of the company.

....The Board considered the fact that as of Nov. 30, 2012, LookSmart had approximately $16.8 million in cash or approximately $0.97 per share.

.....The Board is currently in negotiations to retain an independent restructuring advisor to provide analysis of the value of LookSmart's assets in a liquidation. It is unclear whether a sale, distribution of cash and sale of remaining assets or a liquidation would result in value in excess of the Offer Price."

Looksmart's mention of the November 30th cash position of just $16.8 million (that's down some $0.8 million from the stated $17.6 million at the end of the Q3 period) is a strong concern for me.

It really 'flies in the face' on my previous instapost.

Certainly when considering that I had previously noted an additional $522,000 as being added to Looksmart's debtors (Q3/Q2), that would have surely been 'settled' during the 1st 2 months, of the Q4 period?

As posted & in my mentioning of this additional $522,000 carry-over (compared to Q2's accounts receivables), it went as follows:

What I am saying is that Q3 (in real terms) had an increase in revenues Q/Q of some $300,000 + there's an additional $522,000 to it's debtors (on Q2) or, some $0.82M more revenue than the $3.6M had in Q2 - and clearly due to the introduction of CPM/CPC type impression buying in Q3 or, since 17th of July. That's an increase in the Co's advertiser network's comprehensive income (revenues, Q/Q), of some 24.8%!

And of the stated $2.7 million loss (for Q3) in spite of some $0.6M being attributed to the PEEK Circus, some $0.2M (restructuring expenses), & $0.4M (capitalization of internally developed software) are one-off costs, and are (collectively) representing another $1.2M of that declared loss.

So - WTF is going on, Looksmart?

Disclosure: Long LOOK