ContextLogic Announces Adjournment of Special Meeting of Stockholders to Allow Additional Time for Stockholders to Vote “FOR” the Transaction with Qoo10

Rhea-AI Summary

ContextLogic Inc. (WISH) announces that 97% of shares have voted in favor of the proposed asset sale transaction to Qoo10 Pte. Approximately 500,000 additional votes are needed for the transaction to proceed. The special meeting has been adjourned to reconvene on April 18, 2024. Stockholders are urged to vote 'FOR' the transaction to safeguard their investment in ContextLogic, ensuring the company's future as a publicly traded entity with significant net operating loss carryforwards.

Insights

Financial Analyst

From a financial perspective, the asset sale transaction between ContextLogic and Qoo10 is a significant event that could reshape the company's financial structure. Holding approximately $2.7 billion in net operating loss carryforwards (NOLs) is a strategic tax asset that can offset future taxable income. The urgency expressed in securing the remaining votes suggests a high confidence level in the transaction's potential to enhance shareholder value. However, the emphasis on immediate action raises questions about liquidity concerns and the potential risks of delay, such as diminishing post-closing cash reserves.

Investors should note the potential for the transaction to unlock value through strategic realignment and the preservation of NOLs. However, it's also important to consider the implications of the asset sale on the company's core business operations and future growth prospects. Any reduction in cash reserves could impact the company's ability to invest in growth or weather economic downturns.

Corporate Governance Advisor

The call to action for shareholders to vote 'FOR' the transaction today is a reflection of the company's governance practices, emphasizing the importance of shareholder participation in corporate decisions. The fact that a failure to vote equates to a vote against the transaction is a important detail that underscores the importance of each shareholder's voice in the approval process. The board's proactive communication strategy and the use of a proxy solicitor to assist in voting procedures demonstrate a commitment to facilitating shareholder engagement.

However, the need for additional votes to reach the majority threshold suggests a potential disconnect between the board's strategic vision and shareholder consensus. Shareholders should carefully assess the transaction's long-term implications for governance and control, especially considering the potential changes in the company's asset composition and strategic direction post-transaction.

Market Research Analyst

The asset sale's market implications are multifaceted, potentially affecting the competitive landscape within the e-commerce sector. ContextLogic's decision to sell assets to Qoo10 could signal a strategic pivot or consolidation, which might alter market dynamics and competitive positioning. Investors and competitors alike should monitor the transaction's outcome, as it could lead to shifts in market share and consumer behavior.

Moreover, the impact on ContextLogic's stock price and investor sentiment should be closely watched. The market typically reacts to uncertainty and potential changes in a company's financial health. The success or failure of this transaction could serve as an indicator of the company's operational efficiency and strategic acumen, potentially influencing investor confidence and stock valuation.

Approximately 97% of Shares Voted have been “FOR” the Transaction;

Approximately 500,000 Additional Shares Needed to Vote “FOR” to Complete Transaction

Urges ALL Stockholders to Protect the Value of their Investment by Voting “FOR” the Transaction TODAY

SAN FRANCISCO, April 12, 2024 (GLOBE NEWSWIRE) -- ContextLogic Inc. (d/b/a Wish) (NASDAQ: WISH) (“ContextLogic” or the “Company”) today announced its Special Meeting of Stockholders (the “Special Meeting”) being held today will convene and then adjourn without conducting any business. The Special Meeting will reconvene at 11:30 a.m. Pacific Time on April 18, 2024. The Special Meeting was being held in connection with the Company’s proposed asset sale transaction (the “Asset Sale”) to Qoo10 Pte. Ltd. (“Qoo10”), as described in the Company’s definitive proxy statement filed with the Securities and Exchange Commission (the “SEC”) on March 15, 2024.

To realize the benefits of this value-maximizing Asset Sale, the holders of a majority of ContextLogic outstanding shares must vote in support of the transaction. Approximately 97% of the shares voted have been “FOR” the Asset Sale. ContextLogic currently needs approximately 500,000 additional shares to vote “FOR” the transaction in order to achieve the necessary threshold. The adjournment will provide time to solicit additional proxies necessary to obtain the requisite approval.

Stockholders who have previously submitted their proxy or otherwise voted do not need to take any action. The proxy card included with the previously distributed proxy materials will not be updated to reflect the adjournment and may continue to be used to vote shares in connection with the Special Meeting.

VOTING TODAY “FOR” THE TRANSACTION IS EXTREMELY IMPORTANT AND CRITICAL TO THE FUTURE OF YOUR INVESTMENT IN CONTEXTLOGIC

Upon closing of the transaction, ContextLogic will continue as a publicly traded company with ~$2.7 billion of net operating loss (“NOL”) carryforwards. Closing the Asset Sale as soon as possible will also maximize the Company’s post-closing cash.

The ContextLogic Board of Directors urges all stockholders to protect the value of your investment, by voting FOR the transaction TODAY. All stockholders of record as of the close of business on March 7, 2024 are entitled to vote at the Special Meeting.

Each stockholder’s vote matters and is important no matter how many shares they own. A failure to vote is the same as voting against the transaction. Every day that stockholder approval is delayed will very likely result in materially lower post-closing cash and puts the value of the NOLs at significant risk. 

How to Vote Your Shares

ContextLogic stockholders can vote online or by telephone by following the easy instructions on the previously provided proxy card. To ensure your shares are represented at the Special Meeting, ContextLogic stockholders are urged to vote online or by telephone by following the easy instructions on the previously provided proxy card. The new electronic voting deadline is 11:59 p.m. Eastern Time on April 17, 2024.

If you are a stockholder of record and have questions or need assistance voting your shares, please contact the Company's proxy solicitor MacKenzie Partners by calling toll-free at (800) 322-2885 or via email at proxy@mackenziepartners.com.

Upon receipt of stockholder approval, the Company expects to complete the transaction in the days following.

About Wish
Wish brings an affordable and entertaining shopping experience to millions of consumers around the world. Since our founding in San Francisco in 2010, we have become one of the largest global ecommerce platforms, connecting millions of value-conscious consumers to hundreds of thousands of merchants globally. Wish combines technology and data science capabilities and an innovative discovery-based mobile shopping experience to create a highly-visual, entertaining, and personalized shopping experience for its users. For more information about the company or to download the Wish mobile app, visit www.wish.com or follow @Wish on Facebook, Instagram and TikTok or @WishShopping on X (formerly Twitter) and YouTube.

Additional Information and Where to Find It
In connection with the Asset Sale to the acquiring subsidiary designated by Qoo10 (the “Buyer”), the Company has filed with the SEC, and has furnished to the Company’s stockholders, a definitive proxy statement, and other relevant documents pertaining to the transactions contemplated by the asset purchase agreement with Qoo10 Inc. and Qoo10 (the “Transactions”). Stockholders of the Company are urged to read the definitive proxy statement and other relevant documents carefully and in their entirety because they contain important information about the Transactions. Stockholders of the Company may obtain the definitive proxy statement and other relevant documents filed with the SEC free of charge at the SEC’s website at www.sec.gov or by directing a request to ContextLogic Inc., One Sansome Street, 33rd Floor, San Francisco, California 94104, Attention: Ralph Fong.

Forward Looking Statements
Except for historical information, all other information in this communication consists of forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements, and related oral statements the Company, Qoo10 or the Buyer may make, are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. For example, (1) conditions to the closing of the Transactions may not be satisfied, (2) the timing of completion of the Transactions is uncertain, (3) the amount of the purchase price adjustment under the asset purchase agreement with Qoo10 Inc. and Qoo10 is uncertain and may be material, (4) the amount of that purchase price adjustment could be adversely affected by any delays in closing the Transactions, including delays in obtaining the stockholder vote at the Special Meeting, (5) there can be no assurance as to the extent to which the post-closing Company will find opportunities to utilize the NOLs, and when any such utilization will occur, (6) the business of the Company may suffer as a result of uncertainty surrounding the Transactions, (7) events, changes or other circumstances could occur that could give rise to the termination of the asset purchase agreement with Qoo10 Inc. and Qoo10, (8) there are risks related to the disruption of management’s attention from the ongoing business operations of the Company due to the Transactions, (9) the announcement or pendency of the Transactions could affect the relationships of the Company with its clients, operating results and business generally, including on the ability of the Company to retain employees, (10) the outcome of any legal proceedings initiated against the Company, Qoo10 or the Buyer following the announcement of the Transactions could adversely affect the Company, Qoo10 or the Buyer, including the ability of each to consummate the Transactions, and (11) the Company may be adversely affected by other economic, business, and/or competitive factors, as well as management’s response to any of the aforementioned factors.

The foregoing review of important factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included herein and elsewhere, including the risk factors included in the Company’s most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q and other documents of the Company on file with the SEC. Neither the Company nor Qoo10 or the Buyer undertakes any obligation to update, correct or otherwise revise any forward-looking statements. All subsequent written and oral forward-looking statements are attributable to the Company, Qoo10 or the Buyer and/or any person acting on behalf of any of them.

Contacts

Investor Relations:
Ralph Fong, Wish
ir@wish.com

Media:
Carys Comerford-Green, Wish
press@wish.com

Nick Lamplough / Dan Moore / Jack Kelleher
Collected Strategies
WISH-CS@collectedstrategies.com

FAQ

What is the current percentage of shares voted 'FOR' the Asset Sale transaction by ContextLogic stockholders?

Approximately 97% of the shares have voted 'FOR' the Asset Sale.

How many additional shares are required to vote 'FOR' the transaction to complete it?

Approximately 500,000 additional shares are needed to vote 'FOR' the transaction.

When will the reconvened Special Meeting take place?

The Special Meeting will reconvene at 11:30 a.m. Pacific Time on April 18, 2024.

What will happen to ContextLogic upon closing of the transaction?

Upon closing of the transaction, ContextLogic will remain a publicly traded company with approximately $2.7 billion of net operating loss carryforwards.

How can ContextLogic stockholders vote their shares for the Special Meeting?

ContextLogic stockholders can vote online or by telephone using the instructions provided on the proxy card.