(Source: Business Wire)
Answers Corporation (NASDAQ: ANSW), creators of the leading answer engine offering Answers.com® and WikiAnswers.com, today announced the exercise of the second tranche warrant, issued by the Company in connection with its June 2008 financing, by Redpoint Ventures, a Menlo Park, CA, based venture capital firm specializing in early stage and growth capital investments for the Internet and technology sectors, and the company's largest stockholder.
Upon exercise of the warrant on June 10, 2009, Answers issued $7 million of Series B convertible preferred stock, convertible into 1,272,727 shares of common stock at a conversion price of $5.50 per share, and a warrant exercisable for 636,364 shares of common stock at an exercise price of $6.05 per share.
"We are very pleased to see this further commitment from our biggest investor," said Robert S. Rosenschein, Answers' Chairman and CEO. "This investment confirms their support and confidence in our vision to build the world's best Q&A site."
As part of the investment, Redpoint's Tom Dyal, previously an Answers Corporation board observer, joined the Company's board of directors as a full member, Redpoint's second representative on the board.
Tom Dyal commented, "Since our initial investment one year ago, Answers' growth has been phenomenal, exceeding our expectations. Our second investment in the company reflects the growth opportunity for their technology and community in the Q&A space."
The Company has agreed to file a registration statement with the SEC covering the resale of the shares of common stock issuable upon conversion of the Series B Convertible Preferred Stock and exercise of the warrants and shares issued for the payment in kind of accrued dividends.
The securities issued have not been registered under the Securities Act of 1933 or any state securities laws and unless so registered may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933 and applicable state securities laws.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy securities.
Thomas Weisel Partners LLC acted as lead-placement agent and Canaccord Adams acted as co-placement agent for the June 2008 financing.
About Answers Corporation
Answers Corporation (NASDAQ: ANSW) owns and operates Web properties dedicated to providing useful answers in thousands of categories - Answers.com and WikiAnswers.com.
