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Technology Stocks : Switchboard, Inc. (SWBD) -- Ignore unavailable to you. Want to Upgrade?

To: Glenn Petersen who wrote (25)	8/23/2002 1:33:14 PM
From: Glenn Petersen	Read Replies (1) \| Respond to of 29

More bad news: The CFO resigned last month, they have amended the AOL deal and they have received a delisting notice from Nasdaq. Thursday August 22, 3:33 pm Eastern Time Reuters Company News Switchboard amends AOL deal, faces Nasdaq delisting WESTBOROUGH, Mass. Aug. 22 (Reuters) - Switchboard Inc. (NasdaqNM:SWBD - News), which provides Web-based phone and address directories, on Thursday said it amended a deal with America Online to cut costs, boost advertising dollars and increase services to the Internet arm of AOL Time Warner (NYSE:AOL - News). The company, which was also notified on Thursday that its shares may be delisted from the Nasdaq market, expects to save $12 million from the amended deal but did not detail the impact on the company's results. "Switchboard will be providing additional data content into the AOL pages," Dean Polnerow, president and founder of the company, told Reuters. "For example, we will be collecting content (for) local merchants, like store hours or products that they sell, things that you may find in the paper yellow pages." Switchboard currently provides data to all of AOL brands, including Netscape, Compuserve, Netquest and Digital Cities, the executive said. AOL is a major customer for the company. The amended deal comes as AOL increases its focus on providing exclusive content as it tries to revive growth after suffering with a sharp decline in ad spending and a slower-than-expected move to high-speed Internet services. An improved service "will encourage more merchants to advertise on the yellow pages," Polnerow added. The company also provides its yellow pages products to Bell Canada International Inc. (Toronto:BI.TO - News), The New York Times Co. (NYSE:NYT - News), Knight Ridder Inc. (NYSE:KRI - News) and Tribune Co. (NYSE:TRB - News) The amended deal will terminate on Dec. 31, 2004, as opposed to Dec. 11 2005, as specified in the previous, and second, amendment. Switchboard in late July posted a second-quarter loss in line with its own lowered estimates, and said it would restate its earnings for the past fiscal year to strip out $2.7 million in ad sales. The company's chief financial officer resigned earlier that month. biz.yahoo.com Additional details on the changes in the AOL agreement follow: ITEM 5. OTHER EVENTS AND REGULATION FD DISCLOSURE On August 21, 2002, Switchboard Incorporated (the "Registrant") and America Online, Inc. ("AOL") entered into a Third Amendment (the "Third Amendment") to their Directory and Local Advertising Platform Services Agreement dated December 11, 2000 (the "Agreement"). The Third Amendment made a number of changes to the Agreement as previously amended including but not limited to the following. 1. All remaining scheduled payments from the Registrant to AOL, totalling $12 million, have been eliminated. 2. The requirement that the Registrant escrow funds to guarantee future payments to AOL (established in the Second Amendment to the Agreement dated April 25, 2002 (the "Second Amendment")) has been eliminated. 3. The revenue sharing schedule from the effective date of the Third Amendment forward has been amended. As directory advertising revenues grow under the Agreement, the revenue share that the Registrant receives will decrease as it did in the original Agreement; however, there are several more intermediate steps defined, thereby more gradually decreasing the revenue share the Registrant will receive over the remaining term of the Agreement. The initial revenue share percentage that the Registrant will receive under the amended schedule is the same as it was in the original Agreement. However, upon achieving a substantial level of cumulative gross directory advertising revenue during the term of the Agreement, the percentage revenue share that the Registrant receives will be less than the lowest percentage defined in the original Agreement. 4. The Agreement will terminate on December 31, 2004 unless the parties renew the Agreement, as opposed to December 11, 2005 as specified in the Second Amendment. 5. All "revenue shortfall" lookbacks and remedies defined in the original Agreement, and amended in the Second Amendment, have been eliminated. 6. Enhanced merchant data that the Registrant is compiling for use on Registrant's own Switchboard.com Web site has been made available for AOL's use throughout the term of the Agreement. 7. The amendment allows for sales commissions associated with telemarketing efforts to be subtracted from telemarketing revenues subject to revenue sharing between the parties.