VSCN Visual Sciences (MM)

 

 

 

 

To Omniture Stockholders and Visual Sciences Stockholders:

 

The boards of directors of Omniture, Inc. and Visual Sciences, Inc. have each unanimously approved Omniture’s acquisition of Visual Sciences pursuant to the Agreement and Plan of Reorganization, dated October 25, 2007, by and among Omniture, Voyager Acquisition Corp, a wholly-owned subsidiary of Omniture, and Visual Sciences through a merger transaction.

 

Upon the completion of the proposed merger, Visual Sciences stockholders, other than those exercising appraisal rights, will receive 0.49 of a share of Omniture common stock and $2.39 in cash, without interest, for each share of Visual Sciences common stock they own as of the effective time of the merger. The fixed ratio for exchange will not be adjusted prior to consummation of the merger, other than to reflect any stock splits, combinations or the like. Omniture common stock is traded on the Nasdaq Global Market under the trading symbol “OMTR.” On December 11, 2007, the last trading day prior to the date of this joint proxy statement/prospectus, Omniture common stock closed at $28.92 per share. The aggregate number of shares of Omniture common stock to be issued to Visual Sciences stockholders and optionholders in connection with the merger (including upon the exercise of options assumed by Omniture in the merger) will equal approximately 11.9 million shares. The actual number of shares of Omniture common stock issuable pursuant to the assumption of Visual Sciences stock options will vary depending upon the final calculation of the option exchange ratio, as described herein. The aggregate amount of cash to be paid by Omniture to the Visual Sciences stockholders in the merger will equal approximately $50.2 million.

 

The merger cannot be completed unless Visual Sciences stockholders adopt the merger agreement and Omniture stockholders approve the issuance of Omniture common stock in connection with the merger, each at their respective special meetings of stockholders. More detailed information about Omniture, Visual Sciences and the proposed merger is contained in this joint proxy statement/prospectus. We encourage you to carefully read this joint proxy statement/prospectus before voting, including the section entitled “Risk Factors” beginning on page 27.

 

The Visual Sciences board of directors unanimously recommends that Visual Sciences stockholders vote “FOR” the adoption of the merger agreement. The Omniture board of directors unanimously recommends that Omniture stockholders vote “FOR” the issuance of Omniture common stock in connection with the merger.

 

The date, time and place of each of the special meetings of stockholders are as follows:

 

 

Your vote is very important.   Whether or not you plan to attend Omniture’s or Visual Sciences’ special meeting of stockholders, please take the time to vote by completing and mailing the enclosed proxy card. If your shares are held in “street name,” you must instruct your broker in order to vote.

 

 

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THIS TRANSACTION OR THE SECURITIES OF OMNITURE TO BE ISSUED PURSUANT TO THE MERGER, OR DETERMINED IF THIS JOINT PROXY STATEMENT/PROSPECTUS IS ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

 

This joint proxy statement/prospectus is dated December 12, 2007, and is first being mailed to stockholders of Omniture and Visual Sciences on or about December 17, 2007.

 

ADDITIONAL INFORMATION

 

This joint proxy statement/prospectus incorporates important business and financial information about Omniture, Inc. and Visual Sciences, Inc. from documents that Omniture and Visual Sciences have filed with the Securities and Exchange Commission, which we refer to as the SEC, that are not included in or delivered with this joint proxy statement/prospectus.

 

Omniture will provide you with copies of information relating to Omniture, without charge, upon written or oral request to:

 

OMNITURE, INC.
550 East Timpanogos Circle
Orem, Utah 84097
Attention: Investor Relations
Telephone: (801) 722-7037

 

PLEASE REQUEST DOCUMENTS FROM OMNITURE NO LATER THAN JANUARY 10, 2008.

 

UPON REQUEST, OMNITURE WILL MAIL ANY DOCUMENTS TO YOU BY FIRST CLASS MAIL BY THE NEXT BUSINESS DAY.

 

In addition, you may obtain copies of this information from Omniture’s website, http://www.omniture.com, or by sending an email to ir@omniture.com. Information contained on Omniture’s website does not constitute part of this joint proxy statement/prospectus.

 

Visual Sciences will provide you with copies of information relating to Visual Sciences, without charge, upon written or oral request to:

 

VISUAL SCIENCES, INC.
10182 Telesis Court, 6th Floor
San Diego, California 92121
Attention: Investor Relations
Telephone: (858) 546-0040

 

PLEASE REQUEST DOCUMENTS FROM VISUAL SCIENCES NO LATER THAN JANUARY 10, 2008.

 

UPON REQUEST, VISUAL SCIENCES WILL MAIL ANY DOCUMENTS TO YOU BY FIRST CLASS MAIL BY THE NEXT BUSINESS DAY.

 

In addition, you may obtain copies of this information from Visual Sciences’ website, http://www.visualsciences.com, or by sending an email to investor@visualsciences.com. Information contained on Visual Sciences’ website does not constitute part of this joint proxy statement/prospectus.

 

See the section entitled “Where You Can Find More Information” beginning on page 142 of this joint proxy statement/prospectus for more information about the documents incorporated by reference in this joint proxy statement/prospectus.

 

You should rely only on the information contained in, or incorporated by reference into, this joint proxy statement/prospectus in deciding how to vote on each of the proposals. No one has been authorized to provide you with information that is different from that contained in, or incorporated by reference into, this joint proxy statement/prospectus. This joint proxy statement/prospectus is dated December 12, 2007. You should not assume that the information contained in, or incorporated by reference into, this joint proxy statement/prospectus is accurate as of any date other than that date.

 

This joint proxy statement/prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, or the solicitation of a proxy, in any jurisdiction to or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction. Information contained in this joint proxy statement/prospectus regarding Omniture and Voyager Acquisition Corp has been provided by Omniture and Voyager Acquisition Corp and information contained in this joint proxy statement/prospectus regarding Visual Sciences has been provided by Visual Sciences.

 

OMNITURE, INC.
550 East Timpanogos Circle
Orem, Utah 84097
(801) 722-7037

 

VISUAL SCIENCES, INC.
10182 Telesis Court, 6th Floor
San Diego, California 92121
(858) 546-0040

 

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

To Be Held January 17, 2008

Dear Stockholders of Visual Sciences, Inc.:

 

You are cordially invited to a special meeting of stockholders of Visual Sciences, Inc. at its headquarters located at 10182 Telesis Court, 6th Floor, San Diego, California 92121, on January 17, 2008, at 10:00 a.m. local time. Only stockholders who hold shares of Visual Sciences, Inc. common stock at the close of business on December 11, 2007, the record date for the special meeting, are entitled to vote at the special meeting and any adjournments or postponements of the special meeting.

 

At the special meeting, you will be asked to consider and vote upon and approve the following proposals:

 

 

No other business will be conducted at the special meeting. These proposals are described more fully in this joint proxy statement/prospectus. Please give your careful attention to all of the information included, or incorporated by reference, in this joint proxy statement/prospectus.

 

Visual Sciences, Inc.’s board of directors has unanimously approved the merger agreement and recommends that Visual Sciences stockholders vote “FOR” adoption of the merger agreement and “FOR” the proposal to grant discretionary authority to Visual Sciences management to vote stockholder shares to adjourn or postpone the special meeting, if necessary, to solicit additional proxies if there are not sufficient votes to adopt the merger agreement.

 

This joint proxy statement/prospectus contains detailed information about Visual Sciences, Inc., Omniture, Inc., and the proposed merger. We urge you to carefully read this joint proxy statement/prospectus in its entirety. In particular, see the section entitled “Risk Factors” beginning on page 27 of this joint proxy statement/prospectus for a discussion of the risks related to the merger and owning Omniture common stock. For specific instructions on how to vote your shares, please refer to the section of this joint proxy statement/prospectus entitled “The Special Meeting of Visual Sciences Stockholders” beginning on page 114.

 

Appraisal rights are available under Section 262(d) of the Delaware General Corporation Law in connection with the merger. In order to exercise appraisal rights, Visual Sciences stockholders must deliver a written demand to Visual Sciences no later than the date of the special meeting and must not vote “FOR” the proposal to adopt the merger agreement. A copy of the applicable Delaware statutory provision is included as Annex B of the attached joint proxy statement/prospectus, and a summary of these provisions can be found under “The Merger and Issuance of Common Stock — Appraisal Rights” in the attached joint proxy statement/prospectus.

 

Whether or not you plan to attend the special meeting, please vote as soon as possible so that your shares are represented at the meeting. If you do not vote, it will have the same effect as a vote against the proposal to adopt the merger agreement and make it more difficult for Visual Sciences, Inc. to achieve a quorum at the special meeting.

 

By Order of the Board of Directors,

 

Andrew S. Greenhalgh
Senior Vice President, General Counsel and Secretary

 

San Diego, California
December 12, 2007

 

TABLE OF CONTENTS

 

 

QUESTIONS AND ANSWERS ABOUT THE MERGER
AND SPECIAL MEETINGS OF OMNITURE AND VISUAL SCIENCES

 

The following are some questions that you, as a stockholder of either Omniture or Visual Sciences, may have regarding the merger and the special meetings of Omniture and Visual Sciences stockholders and brief answers to such questions. Omniture and Visual Sciences urge you to read carefully the entirety of this joint proxy statement/prospectus because the information in this section does not provide all the information that may be important to you with respect to the adoption of the merger agreement or the issuance of Omniture common stock in connection with the merger. Additional information is also contained in the annexes to, and the documents incorporated by reference in, this joint proxy statement/prospectus.

 

GENERAL QUESTIONS AND ANSWERS

 

 

 

 

 

 

 

 

 

 

 

QUESTIONS AND ANSWERS FOR OMNITURE STOCKHOLDERS

 

 

 

 

 

 

 

 

For a more detailed explanation of the voting procedures, please see the section entitled “The Special Meeting of Omniture Stockholders — How You Can Vote” beginning on page 111 of this joint proxy statement/prospectus.

 

 

 

The Altman Group, Inc.

1200 Wall Street West

3rd Floor

Lyndhurst, NJ 07071

1-800-217-0538

 

QUESTIONS AND ANSWERS FOR VISUAL SCIENCES STOCKHOLDERS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Altman Group, Inc.

1200 Wall Street West

3rd Floor

Lyndhurst, NJ 07071

1-800-217-0538

 

SUMMARY OF THE MERGER

 

The Companies

 

Omniture, Inc.
550 East Timpanogos Circle
Orem, Utah 84097
(801) 722-7037
http://www.omniture.com

 

Omniture, Inc. (NASDAQ: OMTR) is a leading provider of online business optimization software, enabling customers to manage and enhance online, offline and multi-channel business initiatives. Omniture’s software, which it hosts and delivers to its customers as an on-demand subscription service, enables customers to capture, store and analyze information generated by their Web sites and other sources and to gain critical business insights into the performance and efficiency of marketing and sales initiatives and other business processes. In addition, Omniture offers a range of professional services that complement its online services, including implementation, best practices, consulting, customer support and user training through Omniture University ^tm . Omniture’s 2,700 customers include eBay, AOL, Wal-Mart, Gannett, Microsoft, Neiman Marcus, Oracle, General Motors, Sony and HP.

 

Visual Sciences, Inc.
10182 Telesis Court, 6th Floor
San Diego, California 92121
(858) 546-0040
http://www.visualsciences.com

 

Founded in 1996, Visual Sciences, Inc. (formerly known as WebSideStory, Inc.) (NASDAQ: VSCN) is a leading provider of real-time analytics applications. Visual Sciences’ analytics applications, based on its patent pending on-demand service and software platform, enable fast and detailed analytics on large volumes of streaming and stored data. Approximately 1,590 enterprises worldwide rely on the answers delivered by these applications to provide them with actionable intelligence to optimize their business operations. Visual Sciences provides real-time analytics applications for Web sites, contact centers, retail points-of-sale, messaging systems and the intelligence community. In addition, Visual Sciences’ line of analytics-driven offerings leverages its analytics technology to automatically optimize Web sites and related marketing applications. Visual Sciences’ flexible technology platform, Visual Sciences Technology Platform 5 ^tm , allows Visual Sciences to rapidly introduce tailored solutions to meet its clients’ needs. Visual Sciences is headquartered in San Diego, California, and has East Coast offices in Herndon, Virginia and European headquarters in Amsterdam, The Netherlands.

 

Voyager Acquisition Corp
550 East Timpanogos Circle
Orem, Utah 84097
(801) 722-7037

 

Voyager Acquisition Corp is a wholly-owned subsidiary of Omniture that was incorporated in Delaware in October 2007. Voyager Acquisition Corp does not engage in any operations and exists solely to facilitate the merger.

 

The Internet addresses provided in this joint proxy statement/prospectus are textual references only. The Omniture and Visual Sciences websites are not part of this joint proxy statement/prospectus and the information contained in, or that can be accessed through, these websites is not part of this joint proxy statement/prospectus and should not be relied upon in making an investment decision.

 

Structure of the Merger (See page 89)

 

The merger agreement provides for the merger of Voyager Acquisition Corp, a newly formed, wholly-owned subsidiary of Omniture, with and into Visual Sciences, which we refer to as the first merger. Visual Sciences will survive the merger as a wholly-owned subsidiary of Omniture.

An alternative structure for the merger will be utilized, however, if all of the conditions to closing have been satisfied or waived, except that Omniture and Visual Sciences cannot deliver certain tax representation letters relating to the first merger, and the tax opinion closing condition has not been waived by both Omniture and Visual Sciences, but the closing could occur if certain alternative tax representations letters were delivered by Omniture and Visual Sciences relating to the alternative structure. In that case, immediately following the first merger, Visual Sciences would be merged as part of one integrated transaction into a limited liability company wholly owned by Omniture that is disregarded as an entity for U.S. federal income tax purposes, referred to as the second merger.

 

When we refer to the merger we refer to the first merger, taken together with the second merger, if it occurs. The merger consideration payable to Visual Sciences stockholders will not change if the second merger is completed.

 

Consideration in the Merger (See page 89)

 

Upon completion of the merger, each share of Visual Sciences common stock outstanding immediately prior to the effective time of the merger, other than those shares held by stockholders exercising appraisal rights, will be canceled and automatically converted into the right to receive the merger consideration which is comprised of (1) 0.49 of a share of Omniture common stock and (2) $2.39 in cash, without interest, upon surrender of such share of Visual Sciences common stock in the manner provided in the merger agreement.

 

The per share stock exchange ratio in the merger will be adjusted to reflect fully the effect of any stock split, reverse stock split, subdivisions, stock dividend (including any dividend or distribution of securities convertible into Omniture common stock or Visual Sciences common stock), reorganization, recapitalization, reclassification combination or exchange of shares or other like change with respect to Omniture common stock (including any amendment to Omniture’s certificate of incorporation that disproportionately affects Omniture common stock to be delivered to the holders of Visual Sciences common stock in comparison to the effect such amendment has on the Omniture common stock outstanding immediately prior to such amendment) or Visual Sciences common stock having a record date on or after the date of the merger agreement and prior to the effective time of the merger.

 

Based on the exchange ratio and the number of shares of Visual Sciences common stock outstanding as of December 11, 2007, a total of approximately 10.3 million shares of Omniture common stock will be issued and approximately $50.2 million in cash will be delivered in connection with the merger to holders of shares of Visual Sciences common stock.

 

Treatment of Visual Sciences Options and Restricted Stock (See page 90)

 

At the effective time of the merger, Omniture will assume each outstanding option to purchase shares of Visual Sciences common stock, whether vested or unvested, and convert it into an option to purchase that number of shares of Omniture common stock equal to the number of shares of Visual Sciences common stock subject to the original Visual Sciences option immediately prior to the effective time of the merger multiplied by an option exchange ratio, and rounded down to the nearest whole share. The exercise price per share for each assumed Visual Sciences option will be equal to the exercise price per share of the original Visual Sciences option immediately prior to the effective time of the merger divided by the option exchange ratio, rounded up to the nearest whole cent. Each assumed option will be subject to all other terms and conditions that were applicable to the original Visual Sciences option. The option exchange ratio will be equal to 0.49 plus the quotient obtained by dividing $2.39 by the average closing sale price on the Nasdaq Global Market for one share of Omniture common stock for the ten trading days ending on the trading day prior to the closing date. Each assumed option will be vested immediately following the effective time of the merger as to the same percentage of shares as immediately prior to the effective time of the merger, except to the extent such option provided for acceleration of vesting. As of December 7, 2007, options to purchase approximately 3.3 million shares of Visual Sciences common stock were outstanding under Visual Sciences’ stock option plans.

 

At the effective time of the merger, each outstanding unvested share of Visual Sciences restricted stock will be converted into the merger consideration. Such merger consideration will remain unvested and continue to be subject to the same repurchase option, risk of forfeiture or other conditions as applied to the restricted stock prior to the merger. The merger consideration issued in exchange for the restricted stock will vest and be released from the

repurchase option, risk of forfeiture or other conditions following the effective time of the merger as to the same percentage of shares that would have otherwise vested immediately prior to the effective time of the merger. Omniture shall hold the cash portion of the merger consideration until such repurchase option, risk of forfeiture or other condition expires or is otherwise extinguished at which time it will be distributed to such former holder of shares of Visual Sciences restricted common stock. In the event that a share of Omniture restricted common stock issued in exchange for Visual Sciences restricted common stock is forfeited by the holder thereof pursuant to its terms, the cash portion of the merger consideration will be permanently retained by Omniture.

 

Omniture has agreed to file, no later than ten business days following the effective date of the merger, a registration statement on Form S-8, if available, to register the sale of shares of Omniture common stock issuable in connection with the assumed options that are eligible to be registered on Form S-8, and to cause the registration statement to become and shall use all reasonable efforts to cause such registration statement to remain effective until the date on which such assumed options and restricted stock are no longer outstanding.

 

Recommendation of Board of Directors to Stockholders (See pages 59 and 69)

 

To Omniture Stockholders.   The Omniture board of directors has unanimously determined that the issuance of shares of Omniture common stock in connection with the merger is advisable to, and in the best interests of, Omniture and its stockholders. The Omniture board of directors unanimously recommends that the Omniture stockholders vote “FOR” the issuance of Omniture common stock in connection with the merger agreement. In addition, the Omniture board of directors unanimously recommends that Omniture stockholders vote “FOR” the proposal to adjourn or postpone Omniture’s special meeting, if necessary, if a quorum is present, to solicit additional proxies if there are not sufficient votes in favor of the proposal regarding the issuance of Omniture common stock.

 

To Visual Sciences Stockholders.   The Visual Sciences board of directors has unanimously determined that the merger and the adoption of the merger agreement are advisable and fair to, and in the best interests of, Visual Sciences and its stockholders. The Visual Sciences board of directors unanimously recommends that the Visual Sciences stockholders vote “FOR” the adoption of the merger agreement. In addition, the Visual Sciences board of directors unanimously recommends that Visual Sciences stockholders vote “FOR” the proposal to adjourn or postpone Visual Sciences’ special meeting, if necessary, if a quorum is present, to solicit additional proxies if there are not sufficient votes in favor of the proposal regarding the adoption of the merger agreement.

 

Risk Factors (See page 27)

 

The “Risk Factors” beginning on page 27 of this joint proxy statement/prospectus should be considered carefully by Omniture stockholders in evaluating whether to approve the issuance of shares of Omniture common stock in connection with the merger and by Visual Sciences stockholders in evaluating whether to adopt the merger agreement. These risk factors should be considered along with the additional risk factors contained in the periodic reports of Omniture and Visual Sciences filed with the SEC and the other information included, or incorporated by reference, in this joint proxy statement/prospectus.

 

Opinion of Omniture’s Financial Advisor (See page 59)

 

Omniture’s financial advisor, Credit Suisse Securities (USA) LLC, which we refer to as Credit Suisse, rendered its oral opinion to the Omniture board of directors (which was subsequently confirmed in writing by delivery of Credit Suisse’s written opinion dated the same date) to the effect that, as of October 23, 2007, and based upon and subject to the various considerations described in its written opinion, the merger consideration to be paid in the merger was fair to Omniture, from a financial point of view.

 

The full text of the Credit Suisse opinion, which sets forth, among other things, the procedures followed, assumptions made, matters considered and limitations on the scope of the review undertaken by Credit Suisse in rendering its opinion, is attached as Annex C to this joint proxy statement/prospectus and is incorporated by reference in its entirety. Holders of Omniture common stock are urged to carefully read the opinion in its entirety. Credit Suisse provided its opinion for the information and assistance of the board of directors of Omniture in connection with its consideration of the merger. The Credit Suisse opinion addresses only the fairness, from a financial point of view, of the merger consideration to be paid by Omniture as of the

date of the Credit Suisse opinion. The Credit Suisse opinion does not address any other aspect of the proposed merger and does not constitute a recommendation to any stockholder as to how such stockholder should vote or act on any matter relating to the merger. The summary of the Credit Suisse opinion in this joint proxy statement/prospectus is qualified in its entirety by reference to the full text of the Credit Suisse opinion.

 

Opinion of Visual Sciences’ Financial Advisor (See page 69)

 

Goldman, Sachs & Co., referred to in this joint proxy statement/prospectus as Goldman Sachs, delivered its opinion to Visual Sciences’ board of directors that, as of October 25, 2007 and based upon and subject to the factors and assumptions set forth therein, the cash consideration and stock consideration to be received by the holders of shares of Visual Sciences common stock, taken in the aggregate, pursuant to the merger agreement was fair from a financial point of view to such holders.

 

The full text of the written opinion of Goldman Sachs, dated October 25, 2007, which sets forth assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the opinion, is attached as Annex D . Goldman Sachs provided its opinion for the information and assistance of Visual Sciences’ board of directors in connection with its consideration of the transaction. The Goldman Sachs opinion does not constitute a recommendation as to how any holder of Visual Sciences common stock should vote with respect to the transaction or any other matter.

 

Vote Required by Omniture’s and Visual Sciences’ Stockholders (See pages 112 and 116)

 

A majority of the outstanding shares of Visual Sciences common stock entitled to vote at the special meeting, voting together as a single class, must vote “FOR” the adoption of the merger agreement. The affirmative vote of a majority of the votes cast at the Omniture special meeting must vote “FOR” the issuance of Omniture common stock in connection with the merger.

 

Share Ownership of Omniture’s and Visual Sciences’ Directors and Executive Officers

 

As of the record date for the Visual Sciences special meeting, Visual Sciences’ directors, executive officers and their affiliates, as a group, owned and were entitled to vote 647,268 shares of Visual Sciences common stock, or approximately 3.1% of the outstanding shares of Visual Sciences common stock. As of the record date for the Omniture special meeting, Omniture’s directors, executive officers and their affiliates, as a group, owned and were entitled to vote 11,936,258 shares of Omniture common stock, or approximately 19.95% of the outstanding shares of Omniture common stock.

 

Interests of Visual Sciences’ Directors and Executive Officers in the Merger (See page 76)

 

In considering the recommendation of Visual Sciences’ board of directors that Visual Sciences stockholders vote in favor of the proposal to adopt the merger agreement, Visual Sciences stockholders should be aware that directors and executive officers of Visual Sciences have interests in, and will receive benefits from, the merger agreement that are different from, or in addition to, those of Visual Sciences stockholders generally. Visual Sciences’ board of directors was aware of these interests during its deliberations on the merits of the merger and in making its decision to recommend to Visual Sciences stockholders that they vote to approve the terms of the merger.

 

Regulatory Filings and Approvals Must be Obtained (see page 84)

 

Visual Sciences and Omniture are required to make filings under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, or the HSR Act, with the Antitrust Division of the United States Department of Justice, or the DOJ, and the United States Federal Trade Commission, or the FTC. Visual Sciences and Omniture filed the required notification and report forms on November 7, 2007, and early termination of the waiting period was granted on December 5, 2007.

 

Omniture will List Shares of Omniture Common Stock Issued to Visual Sciences Stockholders on the Nasdaq Global Market (See page 85)

 

Omniture will use its reasonable efforts to cause the shares of Omniture common stock to be issued, and those required to be reserved for issuance, in connection with the merger to be authorized for listing on the Nasdaq Global Market before the completion of the merger, subject to official notice of issuance.

 

Visual Sciences will Delist and Withdraw from Registration its Shares of Common Stock (See page 85)

 

If Omniture and Visual Sciences complete the merger, Visual Sciences stock will no longer be quoted on the Nasdaq Global Market or any other market or exchange.

 

Restrictions on the Ability to Sell Omniture Common Stock (See page 85)

 

The shares of Omniture common stock to be issued in connection with the merger will be registered under the Securities Act and will be freely transferable, except for shares of Omniture common stock issued to any person who is deemed to be an “affiliate” of Visual Sciences prior to the merger and except for shares of restricted Omniture common stock issued in exchange for Visual Sciences restricted common stock, which will be subject to the same restrictions on transfer as were the shares of Visual Sciences restricted common stock for which they were exchanged.

 

Appraisal Rights (See page 85)

 

Under Delaware law, holders of Visual Sciences common stock are entitled to appraisal rights in connection with the merger pursuant to Section 262(d) of the Delaware General Corporation Law. Failure to take any of the steps required under Section 262(d) of the Delaware General Corporation Law on a timely basis may result in a loss of those appraisal rights. The provisions of Delaware law that grant appraisal rights and govern such procedures are attached as Annex B . Holders of Omniture common stock are not entitled to appraisal rights in connection with the merger.

 

Differences between the Rights of Omniture Stockholders and Visual Sciences Stockholders (See page 132)

 

After the merger, Visual Sciences stockholders will become Omniture stockholders and their rights as stockholders will be governed by the certificate of incorporation and bylaws of Omniture and the Delaware General Corporations Law. There are a number of differences between Omniture’s certificate of incorporation and Visual Sciences’ certificate of incorporation and their respective bylaws.

 

Accounting Treatment of the Merger (See page 84)

 

Omniture will account for the merger using the purchase method of accounting in accordance with Statement of Financial Accounting Standards No. 141, “Business Combinations,” with Omniture treated as the acquiring entity. Accordingly, consideration paid by Omniture will be allocated to Visual Sciences’ assets and liabilities based upon their estimated fair values as of the date of the closing of the merger. The results of operations of Visual Sciences will be included in Omniture’s results of operations from the date of the closing of the merger.

 

U.S. Federal Income Tax Consequences of the Merger (See page 81)

 

The merger has been structured to qualify as a reorganization within the meaning of Section 368(a) of the Code, and it is expected that Wilson Sonsini Goodrich & Rosati, Professional Corporation, will render a tax opinion to Omniture and that Latham & Watkins LLP will render a tax opinion to Visual Sciences regarding such qualification. The merger for this purpose includes the first merger and the second merger, if it occurs, as part of one integrated plan of reorganization for U.S. federal income tax purposes. Assuming the merger qualifies as a reorganization, a holder of Visual Sciences common stock who receives a combination of Omniture common stock and cash in exchange for Visual Sciences common stock in the merger will not be permitted to recognize loss, but will recognize gain, if any, equal to the lesser of (1) the amount of cash received in the exchange (other than cash received in lieu of a fractional share) or (2) the excess of (A) the sum of the cash (other than cash received in lieu of a fractional share) plus the fair

market value of the Omniture common stock received in the exchange (treating any fractional share as received for this purpose) over (B) the tax basis of the Visual Sciences common stock surrendered. The gain recognized by Visual Sciences stockholders will generally be a capital gain, and will be long term capital gain if the stockholder’s holding period for his, her, or its Visual Sciences common stock is more than one year at the time of completion of the merger, provided that the receipt of the cash does not have the effect of a dividend for U.S. tax purposes. In general, the determination of whether the receipt of cash pursuant to the merger will be treated as a dividend for U.S. federal income tax purposes depends upon the extent to which a Visual Sciences stockholder’s receipt of cash reduces its deemed percentage stock ownership of Omniture. For purposes of this determination, a Visual Sciences stockholder will be treated as if it first exchanged all of its Visual Sciences common stock solely for Omniture common stock, and then Omniture immediately redeemed a portion of such Omniture common stock in exchange for the cash that such stockholder actually received. The deemed redemption will not be treated as a dividend for U.S. federal income tax purposes only if it results in a “meaningful reduction” in the stockholder’s deemed percentage stock ownership of Omniture, taking into account certain constructive ownership rules. The Internal Revenue Service, or the IRS, has ruled that a minority stockholder in a publicly held corporation whose relative stock interest is minimal and who exercises no control with respect to corporate affairs is considered to have a “meaningful reduction” if the stockholder has even a minor reduction in percentage stock ownership under the above analysis. As these rules are complex and dependent upon a Visual Sciences stockholder’s specific circumstances, each Visual Sciences stockholder should consult its tax advisor to determine whether the receipt of cash by such stockholder may be treated as a dividend for U.S. federal income tax purposes. Long-term capital gains of non-corporate taxpayers currently are taxed at a maximum 15% federal rate. Short-term capital gains are taxed at ordinary income rates. Subject to certain exceptions, dividends received by non-corporate stockholders currently are taxed at a maximum 15% federal rate, provided certain holding period requirements are met.

 

Tax matters are very complicated, and the tax consequences of the merger to a particular stockholder of Visual Sciences will depend in part on such stockholder’s circumstances. Accordingly, we urge you to consult your own tax advisor for a full understanding of the tax consequences of the merger to you, including the applicability and effect of federal, state, local and foreign income and other tax laws.

 

Conditions to Completion of the Merger (See page 103)

 

The obligations of Omniture and Visual Sciences to consummate the merger are subject to the satisfaction or waiver of the following mutual conditions:

 

 

 

In addition, the obligations of each of Omniture and Visual Sciences to consummate the merger are subject to the satisfaction or waiver of the following additional conditions:

 

 

In addition, the obligations of Omniture to effect the merger are subject to the satisfaction or waiver of the following additional condition:

 

 

Prohibition from Soliciting Other Offers (See page 100)

 

Visual Sciences has agreed that it will not:

 

 

However, if Visual Sciences receives an unsolicited, bona fide written acquisition proposal from a third party that its board of directors has concluded is, or would reasonably be expected to lead to, a superior offer, as defined in the merger agreement, then it may furnish nonpublic information to such third party and engage in discussions and negotiations with the third party with respect to the acquisition proposal, if its board of directors has concluded that failure to take such action would reasonably be expected to result in a breach of its fiduciary obligations under applicable law.

 

Termination of the Merger Agreement (See page 104)

 

The merger agreement may be terminated under certain circumstances in accordance with its terms at any time prior to completion of the merger, whether before or after adoption of the merger agreement by Visual Sciences’ stockholders or approval of the issuance of shares of Omniture common stock in connection with the merger by Omniture’s stockholders.

 

Payment of Termination Fee (See page 106)

 

Under the terms of the merger agreement, Visual Sciences must pay a termination fee of $11.8 million to Omniture upon termination of the merger agreement due to certain specified circumstances if such termination is preceded by or concurrent with, the occurrence of certain triggering events.

 

Visual Sciences must also pay a termination fee of $11.8 million to Omniture in connection with a termination of the merger agreement resulting from (A) the failure to complete the merger by the end date, as defined in the merger agreement, if an acquisition proposal had been announced publicly or privately after the date of the merger agreement and not withdrawn prior to the date of such termination, or (B) the proposal for the adoption of the merger agreement failing to receive the requisite affirmative vote at the Visual Sciences special meeting or at any adjournment of that meeting if an acquisition proposal had been announced publicly and not withdrawn prior to the date of such stockholders meeting, or (C) breach of the merger agreement by Visual Sciences if an acquisition proposal had been announced publicly or privately prior to the breach giving rise to such right of termination and, in each case, within twelve months of such termination Visual Sciences enters into a definitive agreement for, or consummates any acquisition of Visual Sciences. This termination fee would be payable upon completion of such acquisition.

 

SELECTED CONDENSED CONSOLIDATED FINANCIAL DATA OF OMNITURE

 

Presented below is Omniture’s selected condensed consolidated financial data. The selected condensed consolidated statement of operations data for the years ended December 31, 2004, 2005 and 2006, and the selected condensed consolidated balance sheet data as of December 31, 2005 and 2006 have been derived from Omniture’s audited consolidated financial statements incorporated by reference into this joint proxy statement/prospectus. The selected condensed consolidated statement of operations data for the years ended December 31, 2002 and 2003, and the selected condensed consolidated balance sheet data as of December 31, 2002, 2003 and 2004, have been derived from Omniture’s audited consolidated financial statements which are not incorporated by reference into this joint proxy statement/prospectus. The condensed consolidated statement of operations data for the nine months ended September 30, 2006 and 2007, and the condensed consolidated balance sheet data as of September 30, 2007, have been derived from Omniture’s unaudited condensed consolidated financial statements incorporated by reference into this joint proxy statement/prospectus. The unaudited condensed consolidated financial statements include, in the opinion of Omniture management, all adjustments, which include only normal recurring adjustments, that management considers necessary for the fair statement of the financial information set forth in those statements. You should read this information together with Omniture’s “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Omniture’s consolidated financial statements and related notes thereto, which can be found in the documents incorporated by reference into this joint proxy statement/prospectus. For a complete list of the documents incorporated by reference into this joint proxy statement/prospectus, please see “Where You Can Find More Information” beginning on page 142 of this joint proxy statement/prospectus. Historical results are not necessarily indicative of the results to be expected in any future period.

 

 

 

 

 

SELECTED CONDENSED CONSOLIDATED FINANCIAL DATA OF VISUAL SCIENCES

 

Presented below is Visual Sciences’ selected condensed consolidated financial data. The selected condensed consolidated statement of operations data for the years ended December 31, 2004, 2005 and 2006, and the selected condensed consolidated balance sheet data as of December 31, 2005 and 2006, have been derived from Visual Sciences’ audited consolidated financial statements incorporated by reference into this joint proxy statement/prospectus. The selected condensed consolidated statement of operations data for the years ended December 31, 2002 and 2003, and the selected condensed consolidated balance sheet data as of December 31, 2002, 2003 and 2004, have been derived from Visual Sciences’ audited consolidated financial statements not incorporated by reference into this joint proxy statement/prospectus. The condensed consolidated statement of operations data for the nine months ended September 30, 2006 and 2007, and the condensed consolidated balance sheet data as of September 30, 2007, have been derived from Visual Sciences’ unaudited consolidated financial statements incorporated by reference into this joint proxy statement/prospectus. The unaudited condensed consolidated financial statements include, in the opinion of Visual Sciences’ management, all adjustments, which include only normal recurring adjustments, that management considers necessary for the fair statement of the results of the financial information set forth in those statements. You should read this information together with Visual Sciences’ “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Visual Sciences’ consolidated financial statements and related notes thereto, which can be found in the documents incorporated by reference into this joint proxy statement/prospectus. For a complete list of the documents incorporated by reference into this joint proxy statement/prospectus, please see “Where You Can Find More Information” beginning on page 142 of this joint proxy statement/prospectus. Historical results are not necessarily indicative of the results to be expected in any future period.

 

 

SELECTED UNAUDITED PRO FORMA CONDENSED
COMBINED FINANCIAL DATA

 

The following selected unaudited pro forma condensed combined financial data is designed to show how the acquisitions by Omniture of Touch Clarity Limited, or Touch Clarity, and Visual Sciences might have affected its historical financial statements if the acquisitions had been completed at an earlier time and was prepared based on the historical financial results reported by Omniture, Touch Clarity and Visual Sciences. Subsequent to the acquisition of Touch Clarity, Omniture changed the name of Touch Clarity Limited to Omniture Limited. To avoid potential confusion, Omniture Limited is referred to as Touch Clarity or Touch Clarity Limited in this joint proxy statement/prospectus. The following should be read in connection with “Unaudited Pro Forma Condensed Combined Financial Statements” beginning on page 119 and the Omniture, Touch Clarity and Visual Sciences audited consolidated financial statements, which are incorporated by reference into this joint proxy statement/prospectus.

 

The unaudited pro forma condensed combined financial statements exclude the results of operations of Visual Sciences Technologies, LLC for the one month period ended January 31, 2006 because they were not material. The unaudited pro forma condensed combined financial statements also exclude the results of operations and financial position of Offermatica Corporation, or Offermatica, because (1) the Offermatica acquisition had not yet closed as of the date of this joint proxy statement/prospectus and the acquisition did not meet the significance thresholds for inclusion pursuant to Regulation S-X promulgated under the Securities Act of 1933, (2) Offermatica is not under common control with Visual Sciences, and (3) the consummation of neither the Visual Sciences nor the Offermatica acquisition is contingent upon the completion of the other.

 

The pro forma data in the tables assume that the Touch Clarity and Visual Sciences acquisitions are accounted for using the purchase method of accounting and represent a current estimate based on available information of the combined companies’ results of operations for the periods presented. As of the date of this document, Omniture has not completed the detailed valuation studies necessary to arrive at the required estimates of the fair value of the Visual Sciences’ assets to be acquired and liabilities to be assumed and the related allocations of purchase price, nor has it identified all the adjustments necessary to conform Visual Sciences’ financial data to Omniture’s accounting policies. However, Omniture has made certain adjustments to the historical book values of the assets and liabilities as of September 30, 2007 to reflect certain preliminary estimates of the fair values necessary to prepare the unaudited pro forma combined data. The fair value adjustments included in the unaudited pro forma condensed combined financial data represent management’s estimate of these adjustments based upon currently available information. The preliminary Visual Sciences purchase price allocation assigned value to certain identifiable intangible assets. Actual results may differ from this pro forma condensed combined financial data once Omniture has determined the final purchase price for Visual Sciences and has completed the detailed valuation studies necessary to finalize the required purchase price allocations and identified any necessary conforming accounting policy changes for Visual Sciences. Accordingly, the final purchase price allocation, which will be determined subsequent to the closing of the acquisition, and its effect on results of operations, may differ materially from the pro forma combined amounts included in this section, although these amounts represent Omniture’s management’s best estimates as of the date of this document.

 

The unaudited pro forma condensed combined balance sheet data assumes that the Visual Sciences acquisition took place on September 30, 2007 and combines Omniture’s historical consolidated balance sheet as of September 30, 2007 with Visual Science’s historical consolidated balance sheet as of September 30, 2007. The unaudited pro forma condensed combined statement of operations data for the year ended December 31, 2006 and for the nine months ended September 30, 2007 give effect to the Touch Clarity and Visual Sciences acquisitions as if they occurred on January 1, 2006.

 

The unaudited pro forma condensed combined financial data is presented for illustrative purposes only and is not necessarily indicative of the financial condition or results of operations of future periods or the financial condition or results of operations that actually would have been realized had the entities been a single company during these periods.

 

 

COMPARATIVE HISTORICAL AND UNAUDITED PRO FORMA PER SHARE DATA

 

The following tables set forth the historical net loss and book value per share of Omniture, Visual Sciences and Touch Clarity common stock and the unaudited pro forma combined net loss and book value per share. The unaudited pro forma combined net loss per share data reflects the acquisitions of Touch Clarity and Visual Sciences as if they had been consummated on January 1, 2006 and the unaudited pro forma combined book value per share data reflects the acquisition of Visual Sciences as if it had been consummated on September 30, 2007.

 

The unaudited pro forma data in the tables assume that the Touch Clarity and Visual Sciences acquisitions are accounted for using the purchase method of accounting and represent a current estimate based on available information of the combined companies’ results of operations for the periods presented. As of the date of this joint proxy statement/prospectus, Omniture has not completed their detailed valuation studies necessary to arrive at the required estimates of the fair value of the Visual Sciences’ assets to be acquired and liabilities to be assumed and the related allocations of purchase price, nor has it identified all the adjustments necessary to conform Visual Sciences’ data to Omniture’s accounting policies. However, Omniture has made certain adjustments to the historical book values of the assets and liabilities as of September 30, 2007 to reflect certain preliminary estimates of the fair values necessary to prepare the unaudited pro forma combined data. The fair value adjustments included in the unaudited pro forma combined consolidated financial data represent management’s estimate of these adjustments based upon currently available information. The preliminary Visual Sciences purchase price allocation assigned value to certain identifiable intangible assets. Actual results may differ from this unaudited pro forma combined financial data once Omniture has determined the final purchase price for Visual Sciences and has completed the detailed valuation studies necessary to finalize the required purchase price allocations and identified any necessary conforming accounting policy changes for Visual Sciences. Accordingly, the final purchase price allocation, which will be determined subsequent to the closing of the acquisition, and its effect on results of operations, may differ materially from the unaudited pro forma combined amounts included in this section, although these amounts represent Omniture’s management’s best estimates as of the date of this joint proxy statement/prospectus.

 

The unaudited pro forma combined financial data is provided for illustrative purposes only and does not purport to represent what the actual consolidated results of operations or the consolidated financial position of Omniture would have been had the acquisitions of Touch Clarity and Visual Sciences occurred on the dates assumed, nor are they necessarily indicative of future consolidated results of operations or consolidated financial position.

 

 

 

 

 

 

 

COMPARATIVE PER SHARE MARKET PRICE DATA

 

Visual Sciences’ common stock trades on the Nasdaq Global Market under the symbol “VSCN.” Omniture’s common stock trades on the Nasdaq Global Market under the symbol “OMTR.”

 

The following table shows the closing prices per share of Omniture common stock and Visual Sciences common stock each as reported on the Nasdaq Global Market on (1) October 24, 2007, the last full trading day preceding the public announcement that Omniture and Visual Sciences had entered into the merger agreement, and (2) December 11, 2007.

 

The table also includes the market value of Visual Sciences common stock on an equivalent price per share basis, as determined by reference to the value of the merger consideration to be received in respect of each share of Visual Sciences common stock in the merger. This equivalent price per share reflects the fluctuating value of the Omniture common stock that Visual Sciences stockholders would receive in exchange for each share of Visual Sciences common stock if the merger was completed on either of these dates applying the exchange ratio of 0.49 of a share of Omniture common stock for each share of Visual Sciences common stock exchanged in the merger, plus $2.39 cash, without interest.

 

 

As of December 11, 2007, there were approximately 85 holders of record of Omniture common stock, including the Depository Trust Company, which holds shares of Omniture’s common stock on behalf of an indeterminate number of beneficial holders, and 59,839,780 shares of Omniture common stock outstanding. As of December 11, 2007, there were approximately 266 holders of record of Visual Sciences common stock, including the Depository Trust Company, which holds shares of Visual Sciences’ common stock on behalf of an indeterminate number of beneficial holders, and 21,024,561 shares of Visual Sciences common stock outstanding.

 

The foregoing table shows only historical information. This table may not provide meaningful information to you in determining whether to adopt the merger agreement. Because the number of shares of Omniture common stock to be issued for each share of Visual Sciences common stock is fixed, changes in the market price of Omniture common stock will affect the dollar value of Omniture common stock to be received by Visual Sciences stockholders pursuant to the merger. Visual Sciences stockholders should obtain current market quotations for Omniture common stock and review carefully the other information contained in this joint proxy statement/prospectus or incorporated by reference into this joint proxy statement/prospectus in considering whether to adopt the merger agreement. See the section entitled “Where You Can Find More Information” on page 142.

 

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

 

This joint proxy statement/prospectus and the documents incorporated by reference into this joint proxy statement/prospectus contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties, as well as assumptions, that, if they never materialize or prove incorrect, could cause the results of Omniture, Visual Sciences or the combined company to differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements generally are identified by the words “may,” “will,” “project,” “might,” “expects,” “anticipates,” “believes,” “intends,” “estimates,” “should,” “could,” “would,” “strategy,” “plan,” “continue,” “pursue”, or the negative of these words or other words or expressions of similar meaning. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. For example, forward-looking statements include projections of earnings, revenues, synergies, accretion or other financial items; any statements of the plans, strategies and objectives of management for future operations, including the execution of integration and restructuring plans and the anticipated timing of filings, approvals and the closing related to the merger; any statements concerning proposed new products, services or developments; any statements regarding future economic conditions or performance; statements of belief and any statement of assumptions underlying any of the foregoing. The risks, uncertainties and assumptions referred to above include the risk that the merger does not close, including the risk that required stockholder and regulatory approvals for the merger and related transactions may not be obtained; the possibility that expected synergies and cost savings will not be obtained; the difficulty of integrating the business, operations and employees of the two companies; as well as developments in the market for online business optimization software and related products and services; and other risks and uncertainties described in the section entitled “Risk Factors” and in the documents that are incorporated by reference into this joint proxy statement/prospectus. You should note that the discussion of Omniture’s and Visual Sciences’ respective board of directors’ reasons for the merger and the descriptions of their respective financial advisors’ opinions contain forward-looking statements that describe beliefs, assumptions and estimates as of the indicated dates and those forward-looking expectations may have changed as of the date of this joint proxy statement/prospectus.

 

If any of these risks or uncertainties materializes or any of these assumptions proves incorrect, the results of Omniture and Visual Sciences or the combined company could differ materially from the expectations in these statements. The forward-looking statements included in this joint proxy statement/prospectus are made only as of the date of this joint proxy statement/prospectus, and neither Omniture nor Visual Sciences is under any obligation to update their respective forward-looking statements and neither party intends to do so.

 

RISK FACTORS

 

If the merger is completed, Visual Sciences and Omniture will operate as a combined company in a market environment that is difficult to predict and that involves significant risks, many of which will be beyond the combined company’s control. In addition to information regarding Visual Sciences and Omniture contained in, or incorporated by reference into, this joint proxy statement/prospectus, you should carefully consider the risks described below before voting your shares. Additional risks and uncertainties not presently known to us or that we do not currently believe are important to an investor, if they materialize, also may adversely affect the merger, Visual Sciences, Omniture and the combined company. A discussion of additional risks and uncertainties regarding Visual Sciences and Omniture can be found in the information which is incorporated by reference in this joint proxy statement/prospectus and referred to in the section entitled “Where You Can Find More Information” beginning on page 142 of this joint proxy statement/prospectus. If any of the events, contingencies, circumstances or conditions described in the following risks actually occur, our respective businesses, financial condition or our results of operations could be seriously harmed. If that happens, the trading price of Omniture common stock or Visual Sciences common stock could decline and you may lose part or all of the value of any Omniture shares or Visual Sciences shares held by you.

 

Risks Related to the Merger and the Combined Company

 

The failure to successfully integrate Visual Sciences business and operations in the expected time frame may adversely affect the combined company’s future results.

 

Omniture believes that the acquisition of Visual Sciences will result in certain benefits, including enhancing profitability, accelerating innovation, achieving operational synergies, and increasing scale and providing for broader presence in key vertical markets. However, Omniture’s ability to realize these anticipated benefits depends on successfully combining the businesses of Omniture and Visual Sciences. The combined company may fail to realize the anticipated benefits of the merger for a variety of reasons, including the following:

 

 

The actual integration may result in additional and unforeseen expenses or delays. If Omniture is not able to successfully integrate Visual Sciences’ business and operations, or if there are delays in combining the businesses, the anticipated benefits of the merger may take longer to realize than expected or may not be realized fully or at all.

 

Because the market price of Omniture common stock will fluctuate, Omniture common stock may not maintain its current value and the value of the Omniture common stock issued in connection with the merger will not be known until the closing of the merger.

 

Upon the completion of the merger, each share of Visual Sciences common stock outstanding immediately prior to the merger will be converted into the right to receive 0.49 of a share of Omniture’s common stock and $2.39 in cash, without interest. Because the exchange ratio for Omniture common shares to be issued in the merger has

been fixed, the value of the merger consideration will depend in part upon the market price of Omniture common stock. The value of Omniture’s common stock to be issued in the merger could be considerably higher or lower than the value at the time the merger consideration was negotiated. The share prices of Omniture common stock and Visual Sciences common stock are subject to the general price fluctuations in the market for publicly traded equity securities, and the prices of both companies’ common stock have experienced significant volatility in the past. Omniture and Visual Sciences urge you to obtain recent market quotations for Omniture common stock and Visual Sciences common stock. Neither Omniture nor Visual Sciences can predict or give any assurances as to the respective market prices of its common stock at any time before or after the completion of the merger. Neither Omniture nor Visual Sciences is permitted to terminate the merger agreement solely because of changes in the market prices of either company’s stock. Stock price changes may result from a variety of factors, including changes in the respective business operations and prospects of Omniture and Visual Sciences, changes in general market and economic conditions, and regulatory considerations. Many of these factors are beyond the control of Omniture or Visual Sciences.

 

General customer uncertainty related to the merger could harm Omniture, Visual Sciences and the combined company.

 

Omniture’s and Visual Sciences’ customers may, in response to the announcement of the proposed merger, or due to concerns about the completion of the proposed merger, delay or defer purchasing decisions. Alternatively, customers may purchase a competitor’s product because of such uncertainty. Further, customer concerns about changes or delays in Omniture’s, Visual Sciences’ or the combined company’s product roadmap may negatively affect customer purchasing decisions. Customers could also be reluctant to purchase the products and services of Visual Sciences or Omniture due to uncertainty about the direction of their technology, products and services, and willingness to support and service existing products which may be discontinued. In addition, customers, distributors, resellers, and others may also seek to change existing agreements with Visual Sciences or Omniture as a result of the proposed merger or not support or promote Visual Sciences’ or Omniture’s technology, products and services due to uncertainty created by the proposed merger. If Omniture’s or Visual Sciences’ customers delay or defer purchasing decisions, or choose to purchase from a competitor, the revenues of Omniture and Visual Sciences, respectively, and the revenues of the combined company, could materially decline or any anticipated increases in revenue could be lower than expected.

 

The integration of Visual Sciences into Omniture may result in significant expenses and accounting charges that adversely affect Omniture’s operating results and financial condition.

 

In accordance with generally accepted accounting principles, Omniture will account for the merger using the purchase method of accounting. The financial results of Omniture may be adversely affected by the resulting accounting charges incurred in connection with the merger, which could include amortization of acquired intangible assets, stock-based compensation, income taxes, restructuring and integration costs. Omniture also expects to incur additional costs associated with combining the operations of Omniture and Visual Sciences, which may be substantial. Additional costs may include: costs of employee redeployment; relocation and retention, including salary increases or bonuses; accelerated amortization of deferred equity compensation and severance payments; reorganization or closure of facilities; taxes; advisor and professional fees and termination of contracts that provide redundant or conflicting services. Some of these costs may have to be accounted for as expenses that would decrease Omniture’s net income and earnings per share for the periods in which those adjustments are made. The price of Omniture’s common stock could decline to the extent Omniture’s financial results are materially affected by the foregoing charges and costs, or if the foregoing charges and costs are larger than anticipated. In addition, the charges and costs described above may not be reflected in the unaudited pro forma condensed combined financial statements contained in this joint proxy statement/prospectus and the unaudited pro forma condensed combined financial statements may not be indicative of the actual results of the combined company following the merger.

The announcement and pendency of the merger could cause disruptions in the businesses of Omniture and Visual Sciences, which could have an adverse effect on their respective business and financial results, and consequently on the combined company.

 

Omniture and Visual Sciences have operated and, until the completion of the merger, will continue to operate, independently. Uncertainty about the effect of the merger on employees, customers and distributors may have an adverse effect on Omniture and Visual Sciences and consequently on the combined company. These uncertainties may impair Omniture’s and Visual Sciences’ ability to retain and motivate key personnel and could cause customers, distributors, suppliers and others with whom each company deals to seek to change existing business relationships which may materially and adversely affect their respective businesses. Due to the limited termination rights agreed to by the parties in the merger agreement, Omniture and Visual Sciences may be obligated to consummate the merger in spite of the adverse effects resulting from the disruption of Omniture’s and Visual Sciences’ ongoing businesses. Furthermore, this disruption could adversely affect the combined company’s ability to maintain relationships with customers, distributors, suppliers and employees after the merger or to achieve the anticipated benefits of the merger. Each of these events could adversely affect Omniture and Visual Sciences in the near term and the combined company if the merger is completed.

 

Failure to complete the merger could negatively impact the stock price and the future business and financial results of Omniture and Visual Sciences.

 

Completion of the merger is subject to a number of closing conditions, including obtaining requisite regulatory and stockholder approvals, and Visual Sciences and Omniture may be unable to obtain such approvals on a timely basis or at all. If the merger is not completed, the price of Visual Sciences and Omniture common stock may decline. If the merger is not completed, the ongoing business of Omniture and Visual Sciences may be adversely affected and, without realizing any of the benefits of having completed the merger, Omniture and Visual Sciences will be subject to a number of risks, including the following:

 

 

Omniture and Visual Sciences could also be subject to litigation related to any failure to complete the transaction. If the merger is not completed, these risks may materialize and may adversely affect Omniture’s and Visual Sciences’ business, financial results and stock price.

 

Integrating Omniture and Visual Sciences may divert management’s attention away from the combined company’s operations.

 

Successful integration of Omniture’s and Visual Sciences’ operations, products and personnel may place a significant burden on the combined company’s management and internal resources. Challenges of integration include the combined company’s ability to incorporate acquired products and business technology into its existing product lines, including consolidating technology with duplicative functionality or designed on a different technological architecture and provide for interoperability, and its ability to sell the acquired products through Omniture’s existing or acquired sales channels. Omniture may also experience difficulty in effectively integrating the different cultures and practices of Visual Sciences, as well as in assimilating Visual Sciences’ geographically dispersed personnel. Further, the difficulties of integrating Visual Sciences could disrupt the combined company’s ongoing business, distract its management focus from other opportunities and challenges, and increase the combined company’s expenses and working capital requirements. The diversion of management attention and any difficulties encountered in the transition and integration process could harm the combined company’s business, financial condition and operating results.

Visual Sciences’ obligation to pay a termination fee under certain circumstances and the restrictions on its ability to solicit other acquisition proposals may discourage other companies from trying to acquire Visual Sciences.

 

Until the merger is completed or the merger agreement is terminated, with limited exceptions, the merger agreement prohibits Visual Sciences from entering into or soliciting any acquisition proposal or offer for a merger or other business combination with a party other than Omniture. Visual Sciences has agreed to pay Omniture a termination fee of $11.8 million under specified circumstances. These provisions could discourage other companies from trying to acquire Visual Sciences for a higher price.

 

Visual Sciences must continue to retain and motivate executives and key employees and recruit new employees, which may be difficult in light of uncertainty regarding the merger, and failure to do so could seriously harm the combined company.

 

In order to be successful, during the period before the merger is completed, Visual Sciences must continue to retain and motivate executives and other key employees and recruit new employees. Experienced personnel in the online business optimization analytics industry are in high demand and competition for their talents is intense. Employees of Visual Sciences may experience uncertainty about their future role with the combined company until or after strategies with regard to the combined company are announced or executed. These potential distractions of the merger may adversely affect Visual Sciences’ ability to attract, motivate and retain executives and key employees and keep them focused on the strategies and goals of the combined company. Any failure by Visual Sciences to retain and motivate executives and key employees during the period prior to the completion of the merger could seriously harm its business, as well as the business of the combined company.

 

The market price of the shares of Visual Sciences common stock may be affected by factors different from or in addition to those affecting the shares of Omniture common stock.

 

Upon completion of the merger, holders of Visual Sciences common stock will become holders of Omniture common stock and will have different rights from the shares of Visual Sciences common stock. For a comparison of the different rights, see the section entitled “Comparative Rights of Omniture Stockholders and Visual Sciences Stockholders” beginning on page 132 of this joint proxy statement/prospectus. In addition, an investment in Omniture common stock has different risks than an investment in Visual Sciences common stock. Former holders of Visual Sciences common stock will be subject to risks associated with Omniture upon exchange of their shares of Visual Sciences common stock for Omniture common stock that are different from or in addition to the risks associated with Visual Sciences.

 

Directors and officers of Visual Sciences have certain interests in the merger that are different from the interests of Visual Sciences stockholders, generally, in recommending that you vote in favor of the proposal to adopt the merger agreement and approve the merger.

 

When considering the Visual Sciences board of directors’ recommendation that the Visual Sciences stockholders vote in favor of the proposal to adopt the merger agreement, Visual Sciences stockholders should be aware that directors and executive officers of Visual Sciences have interests in the merger that may be different from, or in addition to, the interests of Visual Sciences stockholders generally. These interests include:

 

 

 

These interests, among others, may influence Visual Sciences’ directors in making their recommendation that you vote in favor of the proposal to adopt the merger agreement. For a more detailed description of the interests of the directors and executive officers of Visual Sciences, please see the section entitled “The Merger and Issuance of Common Stock — Interests of Visual Sciences’ Directors and Executive Officers in the Merger” beginning on page 76 of this joint proxy statement/prospectus.

 

Risks Related to Omniture

 

Omniture has a history of significant net losses, may incur significant net losses in the future and may not achieve or maintain profitability.

 

Omniture has incurred significant losses in recent periods, including a net loss of $1.3 million in 2004, a net loss of $17.4 million in 2005, a net loss of $7.7 million in 2006 and a net loss of $7.6 million during the first nine months of 2007, primarily as a result of significant investments that Omniture has made in its network infrastructure and sales and marketing organization. At September 30, 2007, Omniture had an accumulated deficit of $46.4 million. Omniture may not be able to achieve or maintain profitability and may continue to incur significant losses in the future. In addition, Omniture expects to continue to increase operating expenses as it implements initiatives to continue to grow its business, which includes, among other things, plans for international expansion, expansion of its infrastructure, expenses incurred to acquire and integrate companies and technologies, the development of new services and general and administrative expenses associated with being a public company. If its revenues do not increase to offset these expected increases in costs and operating expenses, it will not be profitable. You should not consider Omniture’s revenue growth in recent periods as indicative of its future performance. In fact, in future periods its revenues could decline or grow more slowly than expected. Accordingly, Omniture cannot assure you that it will be able to achieve or maintain profitability in the future.

 

Omniture’s quarterly results of operations may fluctuate in the future. As a result, it may fail to meet or exceed the expectations of securities analysts or investors, which could cause its stock price to decline.

 

Omniture’s quarterly results of operations may fluctuate as a result of a variety of factors, many of which are outside of its control. If its quarterly results of operations fall below the expectations of securities analysts or investors, the price of its common stock could decline substantially. Fluctuations in its quarterly results of operations may result from a number of factors, including, but not limited to, those listed below:

 

 

 

Omniture believes that quarterly revenues and results of operations may vary significantly in the future and that period-to-period comparisons of operating results may not be meaningful. You should not rely on the results of one quarter as an indication of future performance.

 

Omniture has derived substantially all of its subscription revenues from sales of its SiteCatalyst service. If the SiteCatalyst service is not widely accepted by new customers, operating results will be harmed.

 

Omniture derives substantially all of its revenues from subscriptions to its Omniture SiteCatalyst service, and it expects that it will continue to derive the substantial majority of its revenues from the Omniture SiteCatalyst service in the future. To date, Omniture has not received significant revenues from Omniture DataWarehouse, Omniture Discover, Omniture Genesis, Omniture SearchCenter or Omniture TouchClarity services. Omniture expects that it will continue to be highly dependent on the success of the Omniture SiteCatalyst service for the foreseeable future. If the Omniture SiteCatalyst service is unable to remain competitive and provide value to customers, ability to achieve widespread acceptance of the Omniture SiteCatalyst service may be hindered and revenue growth and business will be harmed.

 

If Omniture is unable to attract new customers or to sell additional services to existing customers, revenue growth will be adversely affected.

 

To increase its revenues, Omniture must regularly add new customers, sell additional services to existing customers and encourage existing customers to increase their minimum commitment levels. If existing and prospective customers do not perceive services to be of sufficiently high value and quality, Omniture may not be able to attract new customers or increase sales to existing customers and operating results will be adversely affected. Omniture has incurred significant expenses or made investments in connection with the internal development and acquisition of new products or services, such as Omniture TouchClarity and version 2.0 of Omniture Discover. These products or services have only recently been commercially introduced by Omniture and may not achieve broad commercial acceptance. In that event, operating results may be adversely affected and Omniture may be unable to grow revenue or achieve or maintain profitability.

 

Omniture’s business depends substantially on customers renewing their subscriptions for online business optimization services. Any decline in customer renewals would harm future operating results.

 

Omniture sells online business optimization services pursuant to service agreements that are generally one to three years in length. Customers have no obligation to renew their subscriptions for services after the expiration of their initial subscription period and Omniture cannot provide assurance that these subscriptions will be renewed at the same or higher level of service, if at all. In fact, some of Omniture’s customers have elected not to renew their agreements with Omniture. Moreover, under some circumstances, some of Omniture’s customers have the right to

cancel their service agreements prior to the expiration of the terms of their agreements. Omniture cannot assure you that it will be able to accurately predict future customer renewal rates. Customers’ renewal rates may decline or fluctuate as a result of a number of factors, including their satisfaction or dissatisfaction with services, the prices of services, the prices of services offered by competitors, mergers and acquisitions affecting the customer base or reductions in customers’ spending levels. If customers do not renew their subscriptions for services or if they renew on less favorable terms, Omniture’s revenues may decline and business will suffer.

 

The significant capital requirements of Omniture’s business model make it more difficult to achieve positive cash flow and profitability if it continues to grow rapidly.

 

Omniture’s business model involves making significant upfront and ongoing capital expenditures, primarily for network operations equipment, such as servers and other network devices. Because the time frame for evaluating and implementing services, particularly for larger implementations, can be lengthy, ranging up to 90 days or longer, and because Omniture begins to invoice customers only after the service implementation is complete, these expenditures are made well before Omniture receives any cash from the customer. Consequently, it takes a number of months or longer to achieve positive cash flow for a customer. As a result, rapid growth in customers would require substantial amounts of cash. In addition, because of the lengthy implementation periods for new customers, there is a delay between the increase in operating expenses and the generation of corresponding revenues. Omniture depreciates its capital equipment over a period of approximately four years, with depreciation being included in the cost of subscription revenues beginning immediately upon purchase of the equipment. Omniture recognizes revenue, at the earliest, only when it completes implementation of services and invoices the customer. Thus, it can take a number of months or longer to become profitable with respect to any given new customer.

 

Omniture’s growth depends upon the ability to add new and retain existing large customers; however, to the extent Omniture is not successful in doing so, its gross margins and ability to achieve profitability and positive cash flow may be impaired.

 

Omniture’s success depends on its ability to sell online business optimization services to large customers and on those customers continuing to renew their subscriptions in successive years. Omniture derives a significant percentage of its total revenues from a relatively small number of large customers, and the loss of any one or more of those customers could decrease revenues and harm current and future operating results. However, the addition of new large customers or increases in minimum commitment levels by large existing customers requires particularly large capital expenditures and long implementation periods, resulting in longer than usual time periods to profitability and positive cash flow with respect to these customers. In addition, Omniture generally sells services to large customers at a price per transaction lower than for other customers due to their larger transaction commitments. Finally, some customers have in the past required Omniture to allocate dedicated personnel to provide services as a condition to entering into service agreements with Omniture. As a result, new large customers or increased usage of services by large customers may cause gross margins to decline and negatively impact profitability and cash flows in the near term.

 

Because Omniture recognizes subscription revenue over the term of the applicable agreement, the lack of subscription renewals or new service agreements may not immediately be reflected in operating results.

 

The majority of Omniture’s quarterly revenues represent revenues attributable to service agreements entered into during previous quarters. As a result, a decline in new or renewed service agreements in any one quarter will not be fully reflected in revenues for the corresponding quarter but will negatively affect revenues in future quarters. Additionally, the effect of significant downturns in sales and market acceptance of services in a particular quarter may not be fully reflected in results of operations until future periods. Omniture’s business model makes it difficult for any rapid increase in new or renewed service agreements to increase revenues in any one period because revenues from new customers must be recognized over the applicable service agreement term.

Omniture has limited experience with respect to its pricing model and if the prices it charges for services are unacceptable to customers, revenues and operating results may experience volatility or be harmed.

 

Omniture has limited experience with respect to determining the appropriate prices for services that existing and potential customers will find acceptable. As the market for services matures, or as new competitors introduce new products or services that compete with Omniture’s, it may be unable to renew its agreements with existing customers or attract new customers at the same price or based on the same pricing model as used historically. For example, Omniture faces competition from businesses that offer their services at substantially lower prices than its services, and Google Inc. currently offers its web analytics service for free. In addition, Omniture has only recently commercially introduced certain of its services. The price at which customers may be willing to purchase services may be lower or different than expected, which may cause revenue or operating results to be adversely affected. As a result, in the future it is possible that competitive dynamics in the market may require Omniture to change its pricing model or reduce its prices, which could have a material adverse effect on its revenues, gross margin and operating results.

 

If Omniture is unable to develop or acquire new services, revenue growth will be harmed.

 

Omniture’s ability to attract new customers and increase revenues from existing customers will depend in large part on its ability to enhance and improve existing services and to introduce new services in the future. The success of any enhancement or new service depends on several factors, including the timely completion, introduction and market acceptance of the enhancement or service. Any new service developed or acquired may not be introduced in a timely or cost-effective manner and may not achieve the broad market acceptance necessary to generate significant revenues. For example, Omniture has recently introduced version 2.0 of Omniture Discover and introduced new products, such as Omniture Genesis and Omniture TouchClarity, but Omniture has not yet received significant revenues from these services. Additionally, existing and prospective customers may develop their own competing technologies or purchase competitive products or services or engage third-party providers. If Omniture is unable to successfully develop or acquire new services or enhance existing services to meet customer requirements, its business and operating results will be adversely affected.

 

The market for on-demand services, in general, and for online business optimization services, in particular, is at an early stage of development, and if these markets do not develop or develop more slowly than expected, Omniture’s business will be harmed.

 

The market for on-demand services, in general, and for online business optimization services, in particular, are at early stages of development, and it is uncertain whether these services will achieve and sustain high levels of demand and market acceptance. Omniture’s success will depend to a substantial extent on the willingness of companies to increase their use of on-demand services, in general, and for online business optimization services, in particular. Many companies have invested substantial personnel and financial resources to integrate traditional enterprise software into their businesses, and therefore may be reluctant or unwilling to migrate to on-demand services. Other factors that may affect market acceptance include:

 

 

 

The market for these services may not develop further, or it may develop more slowly than expected, either of which would harm Omniture’s business.

 

Omniture operates in a highly competitive market, which could make it difficult for it to acquire and retain customers.

 

Omniture competes in a rapidly evolving and highly competitive market. A significant portion of its business competes with third-party, on-demand services, software vendors and online marketing service providers. Its current principal competitors include:

 

 

Many of the companies that offer web analytics software offer other products or services and as a result could also bundle their products or services, which may result in these companies effectively selling their products or services at or below market prices.

 

Some of Omniture’s current and potential competitors have longer operating histories, greater name recognition, access to larger customer bases and substantially greater resources, including sales and marketing, financial and other resources. As a result, these competitors may be able to:

 

 

In addition, large software, Internet and database management companies may enter the market or enhance their web analytics capabilities, either by developing competing services or by acquiring existing competitors or strategic partners of Omniture, and compete against it effectively as a result of their significant resources and pre-existing relationships with current and potential customers. For example, Google Inc. has a web analytics service that it offers free of charge and it has recently entered into an agreement to acquire DoubleClick Inc., one of Omniture’s strategic partners. Further, Microsoft has announced its intention to create and market a web analytics service free of charge and has recently entered into an agreement to acquire aQuantive, Inc.

 

If Omniture’s services achieve broader commercial acceptance and as it introduces additional services, Omniture expects that it will experience competition from additional companies.

 

If Omniture is not able to compete successfully against current and future competitors, it will be difficult to acquire and retain customers, and Omniture may experience limited revenue growth, reduced revenues and operating margins and loss of market share.

 

Omniture relies on a small number of third-party service providers to host and deliver services, and any interruptions or delays in services from these third parties could impair the delivery of services and harm its business.

 

Omniture hosts its services, and serves all of its customers from seven third-party data center facilities located in California, Texas, Massachusetts, the United Kingdom and Denmark. It does not control the operation of any of

these facilities, and depending on service level requirements, it may not operate or maintain redundant data center facilities for all of its services or for all customers’ data, which increases its vulnerability. These facilities are vulnerable to damage or interruption from earthquakes, hurricanes, floods, fires, power loss, telecommunications failures and similar events. They are also subject to break-ins, computer viruses, sabotage, intentional acts of vandalism and other misconduct. The occurrence of a natural disaster or an act of terrorism, a decision to close the facilities without adequate notice or other unanticipated problems could result in lengthy interruptions in services. Additionally, data center facility agreements are of limited durations, and data facilities have no obligation to renew their agreements with Omniture on commercially reasonable terms, or at all. One of the data center facility agreements requires that Omniture pay for a variable component of power costs and provides for discretionary increases, up to a maximum amount, to the price paid for use of the facility, thereby potentially subjecting Omniture to variations in the cost of power and hosting fees. If Omniture is unable to renew its agreements with the provider of these facilities on commercially reasonable terms, it may experience delays in the provisioning of services until an agreement with another data center facility provider can be arranged.

 

Omniture depends on access to the Internet through third-party bandwidth providers to operate its business. If it loses the services of one or more of its bandwidth providers for any reason, Omniture could experience disruption in its services or it could be required to retain the services of a replacement bandwidth provider.

 

Omniture’s operations rely heavily on the availability of electricity, which also comes from third-party providers. If Omniture or the third-party data center facilities that it uses to deliver services were to experience a major power outage or if the cost of electricity increases significantly, Omniture’s operations would be harmed. If Omniture or its third-party data centers were to experience a major power outage, Omniture would have to rely on back-up generators, which may not work properly, and their supply might be inadequate during a major power outage. Such a power outage could result in a disruption of Omniture’s business.

 

Any errors, defects, interruptions, delays, disruptions or other performance problems with services could harm Omniture’s reputation and may damage its customers’ businesses. Interruptions in services might reduce revenues, cause Omniture to issue credits to customers, cause customers to terminate their subscriptions and adversely affect renewal rates. Omniture’s business would be harmed if customers and potential customers believe services are unreliable.

 

If Omniture fails to respond to rapidly changing technological developments or evolving industry standards, its services may become obsolete or less competitive.

 

The market for Omniture’s services is characterized by rapid technological advances, changes in customer requirements, changes in protocols and evolving industry standards. If Omniture is unable to develop enhancements to, and new features for, existing services or acceptable new services that keep pace with rapid technological developments, its services may become obsolete, less marketable and less competitive and its business will be harmed.

 

Omniture has experienced rapid growth in recent periods. If it fails to manage its growth effectively, Omniture may be unable to execute its business plan, maintain high levels of service or address competitive challenges adequately.

 

Omniture has substantially expanded its overall business, customer base, headcount and operations in recent periods both domestically and internationally. It increased its total number of full-time employees from 157 at December 31, 2004, to 578 at September 30, 2007. In addition, during this same period, Omniture made substantial investments in its network infrastructure operations as a result of growth, and has significantly expanded its geographic presence with the acquisition of two European companies. Omniture will need to continue to expand its business. Omniture anticipates that this expansion will require substantial management effort and significant additional investment in infrastructure. In addition, it will be required to continue to improve operational, financial and management controls and reporting procedures, particularly in view of the complexities associated with more geographically dispersed operations. As such, it may be unable to manage expenses effectively in the future, which may negatively impact gross margins or cause operating expenses to increase in any particular quarter. Historic expansion has placed, and expected future growth will continue to place, a significant strain on managerial,

administrative, operational, financial and other resources. If Omniture is unable to manage its growth successfully, its business will be harmed.

 

Failure to effectively expand Omniture’s sales and marketing capabilities could harm its ability to increase its customer base and achieve broader market acceptance of services.

 

Increasing the customer base and achieving broader market acceptance of services will depend to a significant extent on Omniture’s ability to expand sales and marketing operations. Omniture expects to be substantially dependent on its direct sales force to obtain new customers. Omniture plans to continue to expand its direct sales force both domestically and internationally. Omniture believes that there is significant competition for direct sales personnel with the sales skills and technical knowledge required. Its ability to achieve significant growth in revenues in the future will depend, in large part, on success in recruiting, training and retaining sufficient numbers of direct sales personnel. New hires require significant training and, in most cases, take a significant period of time before they achieve full productivity. Recent hires, sales personnel added through recent business acquisitions and planned hires may not become as productive as Omniture would like, and it may be unable to hire or retain sufficient numbers of qualified individuals in the future in the markets where it does business. Omniture’s business will be seriously harmed if these expansion efforts do not generate a corresponding significant increase in revenues.

 

Omniture’s growth depends in part on the success of strategic relationships with third parties, including technology integration, channel partners and resellers of services.

 

Omniture may not be able to develop or maintain strategic relationships with third parties, including competitors or prospective competitors, with respect to either technology integration or channel development for a number of reasons. For example, Omniture recently launched Omniture Genesis as part of its strategy to broaden its online business optimization platform. If Omniture is unsuccessful in establishing or maintaining strategic relationships with these and other third parties, its ability to compete in the marketplace or to grow revenues would be impaired and operating results would suffer. Further, if search engine or other online marketing providers restrict access to their networks or increase the currently nominal prices they charge for the use of their application programming interfaces, Omniture’s ability to deliver services of sufficiently high value to customers at a profitable price will be negatively affected. Even if Omniture is successful in establishing and maintaining these relationships, it cannot assure you that such relationships will result in increased customers or revenues.

 

Because Omniture’s long-term success depends, in part, on its ability to expand the sales of its services to customers located outside of the United States, its business will be susceptible to risks associated with international operations.

 

Omniture currently maintains offices outside of the United States and currently has operations, sales personnel or independent consultants in several countries. In the first quarter of 2007, Omniture acquired Instadia, which has its principal operations in Copenhagen, Denmark, and Touch Clarity, which has its principal operations in London, England. These acquisitions significantly increased the scope of Omniture’s international operations. Omniture has limited experience operating in foreign jurisdictions. Its inexperience in operating businesses outside of the United States increases the risk that its current and any future international expansion efforts will not be successful. In addition, conducting international operations subjects it to new risks that it has not generally faced in the United States. These include:

 

 

 

The occurrence of any one of these risks could negatively affect Omniture’s international business and, consequently, results of operations generally.

 

Additionally, operating in international markets also requires significant management attention and financial resources. Omniture cannot be certain that the investment and additional resources required in establishing or integrating operations in other countries will produce desired levels of revenues or profitability.

 

Some of its international subscription fees are currently denominated in United States dollars and paid in local currency. As a result, fluctuations in the value of the United States dollar and foreign currencies may make Omniture’s services more expensive for international customers, which could harm its business.

 

Omniture may be liable to customers and may lose customers if it provides poor service, if services do not comply with its agreements or if Omniture is unable to collect customer data or otherwise lose customer data.

 

Because of the large amount of data that Omniture collects and manages, it is possible that hardware failures or errors in its systems could result in data loss or corruption or cause the information that is collected to be incomplete or contain inaccuracies that customers regard as significant. Furthermore, the ability to collect and report data may be interrupted by a number of factors, including the inability to access the Internet, the failure of network or software systems, security breaches or variability in user traffic on customer websites. In addition, computer viruses may harm Omniture’s systems causing it to lose data, and the transmission of computer viruses could expose Omniture to litigation. Omniture may also find, on occasion, that it cannot deliver data and reports to its customers in real time because of significant spikes in consumer activity on their websites. Omniture may be liable to its customers for damages they may incur resulting from these events, such as loss of business, loss of future revenues, breach of contract or for the loss of goodwill to their business. In addition to potential liability, if Omniture supplies inaccurate information or experiences interruptions in its ability to capture, store and supply information in real time or at all, its reputation could be harmed and it could lose customers.

 

Omniture’s errors and omissions insurance may be inadequate or may not be available in the future on acceptable terms, or at all. In addition, its policy may not cover any claim against it for loss of data or other indirect or consequential damages and defending a suit, regardless of its merit, could be costly and divert management’s attention.

 

A rapid expansion of Omniture’s network and systems could cause it to lose customer data or cause its network or systems to fail.

 

In the future, Omniture may need to expand its network and systems at a more rapid pace than it has in the past. For example, if Omniture secures a large customer or a group of customers with extraordinary volumes of information to collect and process, it may suddenly require additional bandwidth and existing systems may not be able to process the information. Omniture’s network or systems may not be capable of meeting the demand for increased capacity, or it may incur additional unanticipated expenses to accommodate these capacity demands. In addition, Omniture may lose valuable data, be able to provide it only on a delayed basis or its network may temporarily shut down if it fails to expand its network to meet future requirements. Any lapse in its ability to collect or transmit data will decrease the value of the data, prevent it from providing the complete data that may be requested by customers and affect some of its customers’ web pages. Any disruption in its network processing or loss of data may damage its reputation and result in the loss of customers.

If a third party asserts that Omniture is infringing upon its intellectual property rights, whether successful or not, it could subject Omniture to costly and time-consuming litigation or expensive licenses, and its business may be harmed.

 

The Internet, software and technology industries are characterized by the existence of a large number of patents, copyrights, trademarks and trade secrets and by frequent litigation based on allegations of infringement or other violations of intellectual property rights. As Omniture faces increasing competition, the possibility of intellectual property rights claims against it grows. Its technologies may not be able to withstand any third-party claims or rights against their use. Additionally, although Omniture has licensed from other parties proprietary technology covered by patents, it cannot be certain that any such patents will not be challenged, invalidated or circumvented. Furthermore, many of its service agreements require it to indemnify customers for third-party intellectual property infringements claims, which would increase its costs as a result of defending such claims and may require that Omniture pay damages if there were an adverse ruling in any such claims. Omniture, and certain of its customers, have in the past received correspondence from third parties alleging that certain of its services, or customers’ use of its services, violate such third parties’ patent rights. For example, Omniture is aware that five of its customers have received letters from a third party alleging, among other things, that these customers’ online activities, including the use of Omniture services, infringe its patents. A few of these customers have requested that Omniture indemnify them against these allegations. Other customers may receive similar allegations of infringement and make similar requests for indemnification under Omniture service agreements with them or this third party may make claims directly against Omniture. These types of claims could harm Omniture’s relationships with its customers, may deter future customers from subscribing to its services or could expose Omniture to litigation with respect to these claims. Even if Omniture is not a party to any litigation between a customer and a third party, an adverse outcome in any such litigation could make it more difficult for it to defend its intellectual property in any subsequent litigation in which Omniture is a named party. Any of these results could harm brand and operating results.

 

Any intellectual property rights claim against Omniture or its customers, with or without merit, could be time-consuming, expensive to litigate or settle and could divert management resources and attention. An adverse determination also could prevent Omniture from offering its services to customers and may require that Omniture procure or develop substitute services that do not infringe.

 

With respect to any intellectual property rights claim against Omniture or its customers, Omniture may have to pay damages or stop using technology found to be in violation of a third party’s rights. Omniture may have to seek a license for the technology, which may not be available on reasonable terms, may significantly increase its operating expenses or require it to restrict its business activities in one or more respects. The technology also may not be available for license to Omniture at all. As a result, Omniture may also be required to develop alternative non-infringing technology, which could require significant effort and expense. For example, in February 2006, Omniture entered into a settlement and patent license agreement with NetRatings, Inc., to resolve a patent infringement lawsuit that NetRatings filed against Omniture in May 2005, and to obtain a non-exclusive, world-wide license to NetRatings’ entire patent portfolio. Under the terms of the agreement, Omniture agreed to pay NetRatings license fees.

 

Omniture’s exposure to risks associated with the use of intellectual property may be increased as a result of acquisitions, as Omniture has a lower level of visibility into the development process with respect to such technology or the care taken to safeguard against infringement risks. In addition, third parties may make infringement and similar or related claims after Omniture has acquired technology that had not been asserted prior to its acquisition.

 

The success of Omniture’s business depends in large part on its ability to protect and enforce its intellectual property rights.

 

Omniture relies on a combination of patent, copyright, service mark, trademark and trade secret laws, as well as confidentiality procedures and contractual restrictions, to establish and protect its proprietary rights, all of which provide only limited protection. Omniture has 19 issued patents in the United States and one patent in the United Kingdom, as well as 46 United States and 36 related international patent applications pending. Omniture

cannot assure you that any patents will issue with respect to its current patent applications in a manner that gives it the protection that it seeks, if at all, or that any future patents issued to Omniture will not be challenged, invalidated or circumvented. Omniture’s currently issued patents and any patents that may issue in the future with respect to pending or future patent applications may not provide sufficiently broad protection or they may not prove to be enforceable in actions against alleged infringers. Also, Omniture cannot assure you that any future service mark registrations will be issued with respect to pending or future applications or that any registered service marks will be enforceable or provide adequate protection of its proprietary rights.

 

Omniture endeavors to enter into agreements with its employees and contractors and agreements with parties with whom it does business in order to limit access to and disclosure of its proprietary information. Omniture cannot be certain that the steps it has taken will prevent unauthorized use of its technology or the reverse engineering of its technology. Moreover, others may independently develop technologies that are competitive to or infringe upon its intellectual property. The enforcement of its intellectual property rights also depends on its legal actions against these infringers being successful, but Omniture cannot be sure these actions will be successful, even when its rights have been infringed.

 

Furthermore, effective patent, trademark, service mark, copyright and trade secret protection may not be available in every country in which its services are available over the Internet. In addition, the legal standards relating to the validity, enforceability and scope of protection of intellectual property rights in Internet-related industries are uncertain and still evolving.

 

Omniture relies on its management team and needs additional personnel to grow its business, and the loss of one or more key employees or the inability to attract and retain qualified personnel could harm its business.

 

Omniture’s success and future growth depends to a significant degree on the skills and continued services of its management team. Omniture’s future success also depends on its ability to attract and retain and motivate highly skilled technical, managerial, marketing and customer service personnel, including members of its management team. All of its employees work for Omniture on an at-will basis. Omniture plans to hire additional personnel in all areas of its business, particularly for its sales, marketing and technology development areas, both domestically and internationally. Competition for these types of personnel is intense, particularly in the Internet and software industries. As a result, Omniture may be unable to successfully attract or retain qualified personnel. Omniture’s inability to retain and attract the necessary personnel could adversely affect its business.

 

Omniture’s recent acquisitions of Instadia and Touch Clarity subject it to numerous risks associated with acquiring and integrating international companies and there can be no assurance that the anticipated benefits of such acquisitions will be realized.

 

In January 2007, Omniture acquired Instadia, based in Copenhagen, Denmark. In March 2007, Omniture acquired Touch Clarity, based in London, England.

 

These two acquisitions and any future acquisitions may result in unforeseen operating difficulties and expenditures, and Omniture can give no assurance that these two acquisitions or any future acquisition will be successful and will not materially adversely affect its business, operating results or financial condition. In particular, Omniture may encounter difficulties assimilating or integrating the acquired businesses, technologies, product and service offerings, internal controls, disclosure controls, information technology infrastructures, personnel and management teams, or operations of the acquired companies (particularly if the key personnel of the acquired company choose not to work for Omniture). In addition, Omniture may experience difficulty retaining the customers of any acquired business due to changes in management and ownership or relating to its ability to continue to support product and service offerings of acquired businesses. Omniture’s failure to successfully integrate acquired businesses into its operations could have a material adverse effect on its business, operating results and financial condition. Moreover, even if such acquisitions are successfully integrated, it may not receive the expected benefits of the transactions if Omniture finds that the acquired business does not further its business strategy or that Omniture paid more than what the business was worth.

 

In conjunction with its acquisition of Touch Clarity, Omniture may also be required to pay up to an additional $3.0 million in consideration during the first quarter of 2008, contingent upon the achievement of certain revenue

milestones during the year ended December 31, 2007. This contingent consideration would increase the aggregate purchase price and goodwill.

 

In connection with the issuance of shares in the Touch Clarity acquisition, Omniture agreed to file with the SEC a registration statement on Form S-3 to cover resales of the shares. The shares became eligible for resale immediately following the effectiveness of the registration statement, subject to the restrictions contained in a certain registration rights agreement, dated February 14, 2007, among Omniture and the former shareholders of Touch Clarity.

 

As a result, former Touch Clarity shareholders will have the ability to sell all of such shares in the public trading market without regard to volume limitations imposed by Rule 144 under the Securities Act, which sales could have a depressant effect on the trading price of Omniture’s common stock.

 

There are numerous risks associated with Omniture’s recent entry into an agreement to acquire Offermatica.

 

On September 7, 2007, Omniture entered into a definitive agreement to acquire, by merger, all of the outstanding voting stock of Offermatica, an on-demand provider of A/B testing and multivariate testing solutions. There are numerous risks associated with Omniture having entered into this agreement. Omniture cannot assure you that all conditions to the proposed acquisition of Offermatica will be completed and the proposed acquisition consummated. The proposed acquisition of Offermatica is subject to the satisfaction of closing conditions, including obtaining regulatory approvals and obtaining the approval of the stockholders of Offermatica. In the event that the proposed acquisition of Offermatica is not completed, Omniture may be subject to risks, including the costs related to the proposed merger, such as legal, accounting, and advisory fees, which must be paid even if the acquisition is not completed. If the proposed acquisition of Offermatica is not completed, the market price of Omniture common stock could decline.

 

If Omniture fails to successfully integrate the business and operations of Omniture and Offermatica, it may not realize the potential benefits of the proposed acquisition. If the proposed acquisition of Offermatica is completed, the integration of Omniture and Offermatica will be a time consuming and expensive process and may disrupt Omniture’s operations if it is not completed in a timely and efficient manner. If this integration effort is not successful, Omniture’s results of operations could be harmed and customers could cancel existing orders or choose not to place new ones. In addition, Omniture may not achieve anticipated synergies or other benefits of the proposed acquisition. Subject to certain exceptions, Omniture has agreed to issue shares of its common stock to stockholders of Offermatica, which shares may be eligible for sale in the public trading market following the closing. The resale of all or a significant portion of the shares that are issued to Offermatica stockholders in the public trading market, or the perception that such shares may be sold, could depress the price of Omniture common stock or cause its stock price to experience volatility.

 

Omniture intends to continue to acquire other companies, which could divert its management’s attention, result in additional dilution to its stockholders and otherwise disrupt its operations and harm its operating results.

 

As part of its business strategy, Omniture expects to continue to make acquisitions of, or investments in, complementary services, technologies or businesses to address the need to develop new products and enhance existing products. Omniture also may enter into relationships with other businesses in order to expand its service offerings, which could involve preferred or exclusive licenses, additional channels of distribution or discount pricing or investments in other companies.

 

Negotiating these transactions can be time-consuming, difficult and expensive, and its ability to close these transactions may often be subject to approvals, such as government regulation, which are beyond its control. Consequently, Omniture can make no assurances that these transactions, once undertaken and announced, will close.

 

Acquisitions may also disrupt Omniture’s ongoing business, divert its resources and require significant management attention that would otherwise be available for ongoing development of its business, as well as cause difficulties in completing projects associated with in-process research and development. Acquisitions also involve

risks associated with difficulties in entering markets in which it has no or limited direct prior experience and where competitors in such markets have stronger market positions. In addition, the revenue of an acquired business may be insufficient to offset increased expenses associated with the acquisition. Acquisitions can also lead to large and immediate non-cash charges that can have an adverse effect on Omniture’s results of operations as a result of write-offs for items such as acquired in-process research and development, impairment of goodwill or the recording of stock-based compensation, as well as restructuring charges. In addition, Omniture may lack experience operating in the geographic market of the businesses that it acquires. Further, international acquisitions, such as the two recent European acquisitions, increase its exposure to the risks associated with international operations. Moreover, Omniture cannot assure you that the anticipated benefits of any future acquisition, investment or business relationship would be realized or that it would not be exposed to unknown liabilities. In connection with one or more of those transactions, Omniture may:

 

 

Material defects or errors in Omniture’s software used to deliver its services could harm Omniture’s reputation, result in significant costs and impair its ability to sell its services.

 

The software applications underlying Omniture’s services are inherently complex and may contain material defects or errors. Any defects that cause interruptions to the availability of services could result in:

 

 

The costs incurred in correcting any material defects or errors in services may be substantial and could adversely affect operating results. After the release of services, defects or errors may also be identified from time to time by an internal team and by customers. These defects or errors may occur in the future.

 

Changes in financial accounting standards or practices may cause adverse, unexpected financial reporting fluctuations and affect reported results of operations.

 

A change in accounting standards or practices can have a significant effect on reported results and may even affect Omniture’s reporting of transactions completed before the change is effective. New accounting

pronouncements and varying interpretations of accounting pronouncements have occurred and are likely to occur in the future. Changes to existing rules or the questioning of current practices may adversely affect reported financial results or the way Omniture conducts its business. For example, on December 16, 2004, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards, or SFAS, No. 123 (revised 2004), Share-Based Payment , or SFAS No. 123R. SFAS No. 123R, which became effective for fiscal periods beginning after September 15, 2005, requires that employee stock-based compensation be measured based on its fair-value on the grant date and treated as an expense that is reflected in the financial statements over the related service period. As a result of SFAS No. 123R, Omniture’s results of operations in 2006 reflects expenses that are not reflected in prior periods, potentially making it more difficult for investors to evaluate 2006 results of operations relative to prior periods.

 

Omniture might require additional capital to support business growth, and this capital might not be available on acceptable terms, or at all.

 

Omniture intends to continue to make investments to support its business growth and may require additional funds to respond to business challenges, including the need to develop new services or enhance existing services, enhance operating infrastructure and acquire complementary businesses and technologies. In addition, Omniture has used a significant amount of its cash to fund the purchase price of its recent acquisitions of Instadia and Touch Clarity, and has agreed to pay in cash a significant portion of the purchase price of the proposed acquisitions of Offermatica and Visual Sciences. Accordingly, Omniture may need to engage in equity or debt financings to secure additional funds. If Omniture raises additional funds through further issuances of equity or convertible debt securities, existing stockholders could suffer significant dilution, and any new equity securities issued could have rights, preferences and privileges superior to those of holders of common stock. Any debt financing secured by Omniture in the future could involve restrictive covenants relating to capital-raising activities and other financial and operational matters, which may make it more difficult for Omniture to obtain additional capital and to pursue business opportunities, including potential acquisitions. In addition, Omniture may not be able to obtain additional financing on terms favorable to it, or at all. If Omniture is unable to obtain adequate financing or financing on terms satisfactory to it, when required, its ability to continue to support its business growth, to pursue additional acquisitions and to respond to business challenges could be significantly limited.

 

If Omniture fails to maintain proper and effective internal controls, its ability to produce accurate financial statements could be impaired, which could adversely affect its operating results, ability to operate its business and investors’ views of Omniture.

 

Ensuring that Omniture has adequate internal financial and accounting controls and procedures in place to help ensure that it can produce accurate financial statements on a timely basis is a costly and time-consuming effort that needs to be re-evaluated frequently. Omniture is in the process of documenting, reviewing and, if appropriate, improving its internal controls and procedures in connection with Section 404 of the Sarbanes-Oxley Act, which requires annual management assessments of the effectiveness of its internal controls over financial reporting. Both Omniture and its independent auditors will be testing internal controls in connection with the Section 404 requirements and, as part of that documentation and testing, may identify areas for further attention and improvement. Implementing any appropriate changes to its internal controls may distract directors, officers and employees, and entail substantial costs in order to modify existing accounting systems, take a significant period of time to complete and distract officers, directors and employees from the operation of its business. Further, Omniture may encounter difficulties assimilating or integrating the internal controls, disclosure controls and information technology infrastructure of the businesses that it has acquired or may acquire in the future. These changes may not, however, be effective in maintaining the adequacy of internal controls, and any failure to maintain that adequacy, or consequent inability to produce accurate financial statements on a timely basis, could increase Omniture’s operating costs and could materially impair its ability to operate its business. In addition, investors’ perceptions that Omniture’s internal controls are inadequate or that it is unable to produce accurate financial statements may seriously affect Omniture’s stock price.

Omniture’s net operating loss carryforwards may expire unutilized, which could prevent it from offsetting future taxable income.

 

At December 31, 2006, Omniture had federal net operating loss carryforwards of approximately $31.3 million that will begin to expire in 2020 and $1.1 million in federal tax credit carryforwards that will begin to expire in 2019. At December 31, 2006, Omniture also had state net operating loss carryforwards of approximately $32.0 million that will begin to expire in 2015 and state research and development credits of approximately $0.5 million that will begin to expire in 2014. Changes in ownership have occurred that have resulted in limitations in its net operating loss carryforwards under Section 382 of the Internal Revenue Code. As a result of these Section 382 limitations, Omniture can only utilize a portion of the net operating loss carryforwards that were generated prior to the ownership changes to offset future taxable income generated in U.S. federal and state jurisdictions. In addition, the timing of when Omniture achieves profitability, if ever, and the dollar amount of such profitability will impact its ability to utilize these net operating loss carryforwards. Omniture may not be able to achieve sufficient profitability to utilize some or all of its net operating loss carryforwards prior to their expiration.

 

If Omniture cannot maintain its corporate culture as it grows, Omniture could lose the innovation, teamwork and focus that it believes its culture fosters, and its business may be harmed.

 

Omniture believes that a critical contributor to its success has been its corporate culture, which it believes fosters innovation and teamwork. As Omniture grows and changes, it may find it difficult to maintain important aspects of its corporate culture, which could negatively affect its ability to retain and recruit personnel, and otherwise adversely affect its future success.

 

Widespread blocking or erasing of cookies or other limitations on Omniture’s ability to use cookies or other technologies that it employs may impede its ability to collect information and reduce the value of its services.

 

Omniture’s services currently use “cookies,” which are small files of information placed on an Internet user’s computer, and “clear GIFs” (also known as pixel tags or web beacons), which are small images placed on a web page to facilitate the collection of visitor browsing data. These technologies help Omniture to analyze the website usage patterns of visitors to customers’ websites. The use of third-party cookies may be construed as wrongful in the eyes of the public or governmental agencies, including non-U.S. regulators. Omniture encourages customers to send Omniture ’s cookies from their own websites and, when they are unwilling to do so, Omniture marks its third-party cookies with their dual origin to indicate that they are both from a customer’s website and from Omniture. However, Omniture cannot assure you that these measures will succeed in reducing any risks relating to the use of third-party cookies.

 

Most currently available web browsers allow site visitors to modify their settings to prevent or delete cookies. Additionally, widely available software allows site visitors to sweep all cookies from their computers at once. Similarly, several software programs, sometimes marketed as ad-ware or spyware detectors, may misclassify the cookies customers are using as objectionable and prompt site visitors to delete or block them. In addition, several of these same software programs may block the use of clear GIFs. If a large number of site visitors refuse, disable or delete their cookies or clear GIFs or if Omniture is otherwise unable to use cookies or clear GIFs, and if alternative methods or technologies are not developed in a timely manner, the quality of data Omniture collects for its customers and the value of its services based on that data would decrease substantially.

 

Omniture interacts with consumers through its customers, so it may be held accountable for customers’ handling of the consumers’ personal information.

 

On behalf of customers, Omniture collects and uses anonymous and personal information and information derived from the activities of website visitors. This enables Omniture to provide customers with anonymous or personally identifiable information from and about the users of their websites. Federal, state and foreign government bodies and agencies have adopted or are considering adopting laws regarding the collection, use and disclosure of this information. Therefore compliance with privacy laws and regulations and Omniture’s reputation

among the public body of website visitors depends on customers’ adherence to privacy laws and regulations and their use of services in ways consistent with consumers’ expectations.

 

Omniture also relies on representations made to it by customers that their own use of services and the information provided to them via Omniture’s services do not violate any applicable privacy laws, rules and regulations or their own privacy policies. Omniture’s customers also represent to it that they provide their website users the opportunity to “opt-out” of the information collection associated with Omniture’s services. Omniture does not audit its customers to confirm compliance with these representations. If these representations are false or if customers do not otherwise comply with applicable privacy laws, Omniture could face potentially adverse publicity and possible legal or other regulatory action.

 

Domestic or foreign laws or regulations may limit Omniture’s ability to collect and use Internet user information, resulting in a decrease in the value of its services, and have an adverse impact on the sales of services.

 

State attorneys general, governmental and non-governmental entities and private persons may bring legal actions asserting that Omniture’s methods of collecting, using and distributing website visitor information are illegal or improper, which could require it to spend significant time and resources defending these claims. The costs of compliance with, and the other burdens imposed by, laws or regulatory actions may prevent it from offering services or otherwise limit the growth of its services. In addition, some companies have been the subject of class-action lawsuits and governmental investigations based on their collection, use and distribution of website visitor information. Any such legal action, even if unsuccessful, may distract management’s attention, divert resources, negatively affect public image and harm its business.

 

Various state legislatures have enacted legislation designed to protect consumers’ privacy by prohibiting the distribution of “spyware” over the Internet. Such anti-spyware laws typically focus on restricting the proliferation of certain kinds of downloadable software, or spyware, that, when installed on an end user’s computer, are used to intentionally and deceptively take control of the end user’s machine. Omniture does not believe that the data collection methods employed by its technology constitute “spyware” or that such methods are prohibited by such legislation. Similar legislation has been proposed federally. This legislation, if drafted broadly enough, could be deemed to apply to the technology it uses and could potentially restrict its information collection methods. Any restriction or change to its information collection methods would cause Omniture to spend substantial amounts of money and time to make changes and could decrease the amount and utility of the information that it collects.

 

Both existing and proposed laws regulate and restrict the collection and use of information over the Internet that personally identifies the website visitor. These laws continue to change and vary among domestic and foreign jurisdictions, but certain information such as names, addresses, telephone numbers, credit card numbers and e-mail addresses are widely considered personally identifying. The scope of information collected over the Internet that is considered personally identifying may become more expansive, and it is possible that current and future legislation may apply to information that customers currently collect without the explicit consent of website visitors. If information that customers collect and use without explicit consent is considered to be personally identifying, their ability to collect and use this information will be restricted and they would have to change their methods, which could lead to decreased use of Omniture’s services.

 

Domestic and foreign governments are also considering restricting the collection and use of Internet usage data generally. Some privacy advocates argue that even anonymous data, individually or when aggregated, may reveal too much information about website visitors. If governmental authorities were to follow privacy advocates’ recommendations and enact laws that limit data collection practices, Omniture’s customers would likely have to obtain the express consent of a user of the customers’ websites before Omniture could collect, share or use any of that user’s information regardless of whether the collection is done on behalf of customers. Any requirement that Omniture obtain consent from the users of customers’ websites would reduce the amount and value of the information that Omniture provides to customers, which might cause some existing customers to discontinue using its services. Omniture would also need to expend considerable effort and resources to develop new information collection procedures to comply with an express consent requirement. Even if customers succeeded in developing new procedures, they might be unable to convince Internet users to agree to the collection and use of the users’

information. This would negatively impact Omniture’s revenues, growth and potential for expanding its business and could cause its stock price to decline.

 

Omniture may face liability for the unauthorized disclosure or theft of private information, which could expose it to liabilities and harm its stock price.

 

Unauthorized disclosure of personally identifiable information regarding website visitors, whether through breach of Omniture’s secure network by an unauthorized party, employee theft or misuse, or otherwise, could harm its business. If there were even an inadvertent disclosure of personally identifiable information, or if a third party were to gain unauthorized access to the personally identifiable information Omniture possesses, its operations could be seriously disrupted, its reputation could be harmed and it could be subject to claims (including claims for substantial liquidated damages) pursuant to agreements with customers or other liabilities. In addition, if a person penetrates Omniture’s network security or otherwise misappropriates data, it could be subject to liability. Such perceived or actual unauthorized disclosure of the information it collects or breach of its security could harm its business.

 

Omniture may face public relations problems as a result of violations of privacy laws and perceived mistreatment of personal information, and these public relations problems may harm its reputation and thereby lead to a reduction in customers and lower revenues.

 

Any perception of Omniture’s practices as an invasion of privacy, whether or not illegal, may subject it to public criticism. Existing and potential future privacy laws and increasing sensitivity of consumers to unauthorized disclosures and use of personal information may create negative public reactions related to its business practices. Public concerns regarding data collection, privacy and security may cause some website visitors to be less likely to visit websites that subscribe to its services. If enough users choose not to visit its customers’ websites, its ability to collect sufficient amounts of information and provide its services effectively would be adversely affected, and those websites could stop using its services. This, in turn, would reduce the value of its services and inhibit or reverse the growth of Omniture’s business.

 

Internet-related and other laws could adversely affect Omniture’s business.

 

Laws and regulations that apply to communications and commerce over the Internet are becoming more prevalent. In particular, the growth and development of the market for online commerce has prompted calls for more stringent tax, consumer protection and privacy laws, both in the United States and abroad, that may impose additional burdens on companies conducting business online. This could negatively affect the businesses of Omniture’s customers and reduce their demand for its services. Internet-related laws, however, remain largely unsettled, even in areas where there has been some legislative action. The adoption or modification of laws or regulations relating to the Internet or its operations, or interpretations of existing law, could adversely affect its business.

 

The trading price of Omniture’s common stock may be subject to significant fluctuations and volatility, and its stockholders may be unable to resell their shares at a profit.

 

The stock markets, in general, and the markets for high technology stocks in particular, have experienced high levels of volatility. The market for technology stocks has been extremely volatile and frequently reaches levels that bear no relationship to the past or present operating performance of those companies. These broad market fluctuations may adversely affect the trading price of Omniture’s common stock. In addition, the trading price of its common stock has been subject to significant fluctuations and may continue to fluctuate or decline. Since its initial public offering, which was completed in July 2006, the price of Omniture’s common stock has ranged from an intra-day low of $5.60 to an intra-day high of $38.57 through December 11, 2007. Factors that could cause fluctuations in the trading price of its common stock include the following:

 

 

 

These factors, as well as general economic and political conditions and the announcement of proposed and completed acquisitions or other significant transactions, or any difficulties associated with such transactions, by Omniture or its strategic partners, customers or current competitors, may materially adversely affect the market price of its common stock in the future. In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been instituted against that company. Such litigation could result in substantial cost and a diversion of management’s attention and resources. In addition, volatility, lack of positive performance in its stock price or changes to its overall compensation program, including its equity incentive program, may adversely affect its ability to retain key employees.

 

If securities analysts stop publishing research or reports about Omniture’s business, or if they downgrade its stock, the price of its stock could decline.

 

The trading market for Omniture’s common stock relies in part on the research and reports that industry or financial analysts publish about it. Omniture does not control these analysts. If one or more of the analysts who do cover Omniture downgrade its stock, its stock price would likely decline. Further, if one or more of these analysts cease coverage of Omniture, it could lose visibility in the market, which in turn could cause its stock price to decline.

 

The concentration of Omniture’s capital stock ownership with insiders will likely limit the ability of other stockholders to influence the outcome of key transactions, including a change of control.

 

Omniture’s executive officers, directors, five percent or greater stockholders and affiliated entities together beneficially own a substantial amount of the outstanding shares of its common stock. As a result, these stockholders, if acting together, would be able to exert significant influence over most matters requiring approval by its stockholders, including the election of directors and the approval of significant corporate transactions, even if other stockholders oppose them. This concentration of ownership may have the effect of delaying, preventing or deterring a change of control of Omniture that other stockholders may view as beneficial, could deprive its stockholders of an opportunity to receive a premium for their common stock as part of a sale of Omniture and might ultimately affect the market price of its common stock.

Provisions in Omniture’s certificate of incorporation and bylaws under Delaware law might discourage, delay or prevent a change of control of Omniture or changes in its management and, therefore, depress the trading price of its common stock.

 

Omniture’s certificate of incorporation and bylaws contain provisions that could depress the trading price of its common stock by acting to discourage, delay or prevent a change of control of Omniture or changes in its management that the stockholders of Omniture may deem advantageous. These provisions:

 

 

Additionally, Omniture is subject to Section 203 of the Delaware General Corporation Law, which generally prohibits a Delaware corporation from engaging in any of a broad range of business combinations with any “interested” stockholder for a period of three years following the date on which the stockholder became an “interested” stockholder and which may discourage, delay or prevent a change of control of Omniture.

 

PROPOSAL ONE — THE MERGER AND ISSUANCE OF COMMON STOCK

 

The following is a description of the material aspects of the proposed merger and related transactions. The following description may not contain all of the information that is important to you. You should read this entire joint proxy statement/prospectus, including the section entitled “Risk Factors” beginning on page 27, and the other documents we refer to carefully for a more complete understanding of the merger and the related transactions.

 

Background of the Merger

 

In the past, the respective board of directors and management of Omniture and Visual Sciences (formerly named WebSideStory, Inc.) have each individually regularly reviewed their respective strategic plans, business and operations, with the goal of enhancing stockholder value, including opportunities for consolidation with
complementary companies.

 

In January 2007, Omniture acquired Instadia A/S, a provider of enterprise, on-demand web analytics services based in Copenhagen, Denmark. In March 2007, Omniture acquired Touch Clarity Limited, a provider of enterprise, on-demand, automated onsite behavioral targeting and optimization solutions based in London, England. In addition, on September 7, 2007, Omniture announced a definitive agreement to acquire Offermatica Corporation, an on-demand provider of A/B testing and multivariate testing solutions that enable companies to define and test the structure and other elements of their websites.

 

From time to time since 2004, Jeffrey W. Lunsford, a director of Visual Sciences and at that time the Chief Executive Officer of Visual Sciences, and Joshua G. James, Chief Executive Officer and co-founder and a director of Omniture, had various telephone conversations and meetings at which they discussed the possibility of a business combination involving Visual Sciences and Omniture. In September 2006, Mr. Lunsford and Mr. James had a telephone conversation to again explore the possibility of a business combination involving Visual Sciences and Omniture. On September 20, 2006, Mr. Lunsford, Mr. James, and Michael S. Herring, Chief Financial Officer of Omniture, met in Provo, Utah to discuss a possible combination of Visual Sciences and Omniture, including a high level discussion of potential cost savings, benefits to customers and investors and management of a combined company. Messrs. Lunsford and James met again in Phoenix, Arizona on October 17, 2006, to continue the September 20 discussion. Shortly after the October 2006 meeting, on October 30, 2006, Visual Sciences announced that Mr. Lunsford was leaving his position as Chief Executive Officer of Visual Sciences effective as of November 20, 2006 and would be succeeded by James W. MacIntyre, IV. Mr. Lunsford would remain as a director. At various times in 2006 and 2007, following Mr. Lunsford’s departure as Chief Executive Officer, Mr. James contacted Mr. MacIntyre as to the possibility of resuming acquisition discussions. However, Omniture and Visual Sciences did not resume their discussions until later in 2007 as described below.

 

On July 6, 2007, the board of directors of Visual Sciences held a special telephonic meeting. A representative of Latham & Watkins LLP, referred to herein as Latham & Watkins, Visual Sciences’ outside corporate counsel, also participated in the meeting. At this meeting, the board of directors of Visual Sciences discussed the company’s estimated preliminary financial results for the second quarter. In light of those results, the board of directors also discussed short-term and long-term issues and opportunities before Visual Sciences and various alternatives to address the same, as well as the unsolicited inquiries that management had received recently from third parties seeking to discuss potential strategic combination transactions with Visual Sciences. At the meeting, the board of directors of Visual Sciences determined that it would be beneficial to obtain advice from a financial advisor with regard to the unsolicited inquiries received by the company, the company’s preliminary financial results for the second quarter of 2007, and the strategic issues and opportunities before Visual Sciences. As a result, the board of directors of Visual Sciences instructed William H. Harris, Jr., Chairman of the board of directors of Visual Sciences, and Mr. Lunsford to work with the company’s management to contact one or more investment banking firms about potentially advising the company. Later that day, Messrs. Harris, Lunsford and MacIntyre reviewed and discussed the investment banking firms that Visual Sciences had previously worked with or that had recently expressed a desire to work with the company and determined that the company should contact Goldman Sachs about the assignment. Mr. Lunsford then contacted representatives of Goldman Sachs to discuss Goldman Sachs’ potentially serving as financial advisor to the company and its board of directors.

 

On July 9, 2007, the board of directors of Visual Sciences held a special telephonic meeting in which a representative of Latham & Watkins also participated. At this meeting, Visual Sciences’ management reported

about its continuing efforts to finalize the company’s estimated preliminary results for the second quarter. Management also discussed with the board of directors the company’s performance estimates for the remainder of 2007 and alternative scenarios for operating Visual Sciences on an independent basis. Mr. Harris reported that, as requested by the board of directors, Messrs. Harris, Lunsford and MacIntyre had discussed the selection of a financial advisor and determined to contact Goldman Sachs, that Mr. Lunsford had contacted representatives from Goldman Sachs, and that Goldman Sachs had expressed interest in serving as Visual Sciences’ financial advisor. Management then reviewed and discussed with the board of directors the status of the unsolicited acquisition inquiries recently received from various parties. The board of directors also discussed the merits of exploring these inquiries and evaluating other strategic alternatives at this time, including whether or not to retain a financial advisor, and analyzed whether such activities should be announced publicly. At the conclusion of the meeting, the board of directors requested that management schedule a meeting for July 10, 2007, at which representatives from Goldman Sachs would present their views regarding Visual Sciences and its strategic alternatives.

 

On July 10, 2007, the board of directors of Visual Sciences held a special telephonic meeting. Representatives of Goldman Sachs and a representative of Latham & Watkins also participated in the meeting. At this meeting, the Goldman Sachs representatives discussed with the Visual Sciences’ board of directors various topics, including potential consolidation in the analytics industry, preliminary financial analyses regarding Visual Sciences, a preliminary analysis of several software industry peer companies and potential buyers of the company, certain considerations regarding making a public announcement that the board of directors was evaluating unsolicited acquisition interest, and the possible manner of implementation and impact of a process to evaluate strategic transaction alternatives. After Goldman Sachs departed the meeting, the board of directors discussed with management the company’s stand-alone business case and prospects, the desirability of maintaining the independence of Visual Sciences, and the potential impacts on the company, its business and employees of conducting a process to evaluate acquisition interest, including if the process were to be publicly announced. The board of directors also reviewed with a representative of Latham & Watkins the terms of the proposed engagement letter that had been negotiated with Goldman Sachs. At the conclusion of the meeting and after discussion among the board members, the Visual Sciences board of directors authorized management to retain Goldman Sachs as Visual Sciences’ financial advisor to assist the board of directors in conducting a strategic transaction evaluation process, and determined that the company should proceed with a public announcement of such process.

 

On July 11, 2007, Mr. Lunsford contacted Mr. James by telephone. In the conversation, Mr. Lunsford inquired as to Omniture’s interest in a business combination with Visual Sciences and indicated that Visual Sciences would be making a public announcement the following day.

 

On July 12, 2007, Visual Sciences engaged Goldman Sachs as its financial advisor. Also on that day, Visual Sciences issued a press release announcing its preliminary estimated financial results for the second quarter of 2007, and announced in the press release that, in response to unsolicited inquiries from a number of potential strategic buyers, the company had retained Goldman Sachs as its financial advisor to assist the board of directors in evaluating potential business combination transactions.

 

In response to the Visual Sciences’ announcement and Mr. Lunsford’s inquiry, management of Omniture contacted Credit Suisse Securities (USA) LLC, referred to herein as Credit Suisse, to assist it in evaluating a combination with Visual Sciences. Representatives of Credit Suisse contacted representatives of Goldman Sachs on July 12, 2007, to discuss the process proposed to be conducted by Goldman Sachs on behalf of Visual Sciences. On July 20, 2007, representatives of Credit Suisse spoke with representatives of Goldman Sachs regarding transaction process, including a confidentiality agreement to be entered into by Omniture and Visual Sciences. Representatives of Goldman Sachs sent to representatives of Credit Suisse a proposed confidentiality agreement on July 21, 2007.

 

From late July to early August 2007, at the instruction of the board of directors of Visual Sciences, Goldman Sachs and Visual Sciences contacted approximately 25 parties (including the parties that had previously expressed interest in discussing an acquisition transaction) to gauge interest in a potential business combination with Visual Sciences. The parties contacted included both strategic and financial buyers. Omniture and seven other parties expressed interest in participating in the process. Between July 27, 2007 and August 16, 2007, Latham & Watkins negotiated confidentiality agreements on behalf of Visual Sciences with each of these parties, and each of these parties subsequently received management presentations by Visual Sciences.

On July 25, 2007, following a series of communications among the directors, the board of directors of Visual Sciences by unanimous written consent formed a special transaction committee, referred to herein as the transaction committee, consisting of Anil Arora, James R. Glynn, Mr. Harris, Douglas S. Lindroth, Mr. Lunsford and James S. Mahan, III. Mr. Harris was named chairman of the transaction committee. The board of directors authorized the transaction committee to analyze the proposed terms and conditions of potential strategic transactions involving Visual Sciences, to retain outside experts, advisors and consultants at its discretion for the purpose of analyzing strategic alternatives and to make a recommendation to Visual Sciences’ board of directors as to whether it was in the best interests of Visual Sciences and its stockholders to enter into any particular strategic transaction.

 

On August 1, 2007, at a regularly scheduled meeting of the Visual Sciences board of directors, the members of the transaction committee and Goldman Sachs delivered an update to the Visual Sciences board regarding the status of the strategic transaction evaluation process and the activities undertaken by Goldman Sachs and the company’s management in connection with the process since the July 12, 2007 announcement.

 

On August 3, 2007, representatives of Credit Suisse again spoke with representatives of Goldman Sachs to discuss due diligence information to be provided by Visual Sciences, and the process for submission of indications of interest.

 

On August 13, 2007, the Visual Sciences board of directors and transaction committee held a telephonic meeting. At the meeting, Andrew S. Greenhalgh, Senior Vice President and General Counsel of Visual Sciences, reported to the board of directors and transaction committee regarding the terms of a proposed settlement agreement that had been negotiated with NetRatings, Inc., or NetRatings, to resolve the lawsuits that the parties had filed against each other in February 2006 in which each party alleged that certain of the other party’s products infringed the patent rights of such party. The board of directors then discussed with management and a representative of Goldman Sachs the anticipated benefits to Visual Sciences and the pending strategic transaction evaluation process of entering into the settlement agreement to resolve the litigation with NetRatings. The Goldman Sachs representative then departed the meeting and the board discussed the litigation settlement in a privileged executive session with representatives from Latham & Watkins, the company’s special litigation counsel with respect to the NetRatings cases. Following that discussion, the board of directors, by unanimous vote of the members in attendance, then authorized Visual Sciences to negotiate and enter into a definitive settlement agreement with NetRatings. The Goldman Sachs representative then rejoined the meeting and delivered an update to the transaction committee regarding the recent management presentations to various parties and the general status of the strategic transaction evaluation process.

 

On August 14, 2007, Goldman Sachs distributed bid process letters to potential transaction parties. Because Omniture had not yet executed a confidentiality agreement with Visual Sciences, Goldman Sachs did not distribute the bid process letter to Omniture. The bid process letters stated a deadline of August 22, 2007 for prospective buyers to provide preliminary, non-binding indications of interest regarding the potential acquisition of Visual Sciences.

 

On August 16, 2007, Omniture and Visual Sciences executed a mutual confidentiality agreement. Also on August 16, 2007, Goldman Sachs distributed a bid process letter to Omniture. Between August 16, 2007 and August 24, 2007, certain Visual Sciences preliminary due diligence materials were provided to Omniture.

 

On August 17, 2007, Visual Sciences entered into the final settlement and patent cross-license agreement with NetRatings to resolve patent infringement lawsuits between the parties, and announced the settlement agreement in a press release issued on August 20, 2007. On August 21, 2007, members of Visual Sciences’ management, Omniture’s management and representatives of Goldman Sachs and Credit Suisse conducted a conference call regarding the terms of the NetRatings settlement and its effect on Visual Sciences’ financial statements and its potential effect on a combined company.

 

On August 19, August 24, and August 28, 2007, representatives of Omniture, including Mr. Herring, Shawn J. Lindquist, Omniture’s Chief Legal Officer, and representatives of Omniture’s finance staff and representatives of Credit Suisse held conference calls with Claire Long, Chief Financial Officer of Visual Sciences, Kim Rosso, Director of Financial Reporting and Compliance of Visual Sciences, and representatives of Goldman Sachs to conduct financial due diligence on Visual Sciences.

On August 22, 2007, Omniture and another transaction party, referred to herein as Company A, submitted preliminary, non-binding indications of interest to acquire Visual Sciences, in each case subject to further due diligence. Omniture’s preliminary indication of interest proposed a stock-for-stock merger, and Company A’s preliminary indication of interest proposed an all cash merger. No other proposals were submitted.

 

On August 23, 2007, the transaction committee held a telephonic meeting to discuss the preliminary indications of interest that had been received. Members of Visual Sciences’ management and representatives of Goldman Sachs and Latham & Watkins were also present at the meeting. At this meeting, a representative of Goldman Sachs presented an update on the strategic transaction process, reviewed the material terms of each proposal received, and discussed various data and analyses with the committee. Representatives of Latham & Watkins also reviewed certain regulatory issues with respect to the proposals. At the conclusion of the meeting, the transaction committee instructed management and Goldman Sachs to continue discussions with each party that had submitted a preliminary indication of interest, and to seek to cause each party to increase the value of its proposal.

 

On August 24, 2007, a representative of Goldman Sachs communicated with representatives of Credit Suisse on behalf of Omniture and the financial advisor to Company A regarding the transaction committee’s desire for each party to increase the value of its proposal. Goldman Sachs also informed representatives of Credit Suisse that the transaction committee desired to receive further clarification and an additional proposal from Omniture regarding the stock pricing and exchange mechanics in its stock-for-stock merger proposal. Goldman Sachs also informed Company A’s financial advisor that Visual Sciences desired to move forward with the due diligence process with Company A with the expectation that Company A would ultimately improve the value of its proposal. Company A and certain of its representatives, including counsel to Company A in the transaction, were given access to the online data room.

 

On August 27, 2007, Latham & Watkins distributed a draft of the merger agreement to counsel to Company A.

 

Between August 30, 2007 and September 5, 2007, multiple due diligence meetings were held between members of management of Visual Sciences, Company A and representatives of Goldman Sachs and Company A’s financial advisor.

 

On September 7, 2007, on behalf of Company A, Company A’s counsel delivered a revised draft of the merger agreement to Latham & Watkins. On September 10, 2007, the transaction committee held a telephonic meeting in which members of Visual Sciences’ management and representatives of Goldman Sachs and Latham & Watkins also participated. At this meeting, a representative of Goldman Sachs presented an update to the committee on the strategic transaction process, and a representative of Latham & Watkins reviewed the most significant issues regarding Company A’s September 7 proposed revisions to the draft of the merger agreement.

 

During the period from August 22, 2007 to September 10, 2007, representatives of Goldman Sachs conducted several telephone calls with representatives of Credit Suisse concerning the status of the strategic transaction process and of Omniture’s plans with respect to the process.

 

On September 12, 2007, Company A informed Visual Sciences and Goldman Sachs that due to its own internal strategic developments, it was withdrawing from the strategic transaction process. Later on the afternoon of September 12, 2007, Visual Sciences’ management and members of the transaction committee discussed the development regarding Company A by telephone. As Omniture had not taken any actions since August 24, 2007 to improve or clarify the terms of its preliminary indication of interest, the transaction committee determined that Mr. Lunsford should contact Mr. James to assess Omniture’s interest in resuming its active participation in the strategic transaction process.

 

On September 13, 2007, Mr. Lunsford contacted Mr. James, to assess Omniture’s interest in resuming its active participation in the strategic transaction process. Mr. James confirmed that Omniture was interested in resuming its participation in the strategic transaction process, but would need additional due diligence information about Visual Sciences and its business in order to continue to participate in the process.

 

On September 14, 2007, the Visual Sciences board of directors held a special telephonic meeting in which members of Visual Sciences’ management and representatives of Goldman Sachs and Latham & Watkins also participated. At this meeting, a representative of Goldman Sachs presented an update to the board of directors on the

strategic transaction process, and the board of directors discussed and evaluated the status of the process and directed that management meet with Omniture to evaluate the seriousness of their interest in acquiring Visual Sciences.

 

On September 20, 2007, Mr. Harris, Mr. MacIntyre and Ms. Long met with Omniture’s management, including Mr. James, Mr. Herring and Mr. John F. Mellor, Omniture’s Senior Vice President, Business Development and Corporate Strategy, and a representative of Credit Suisse in Salt Lake City, Utah, to conduct business and operational due diligence regarding Visual Sciences and further discuss a possible combination of the companies. The following day, Ms. Long provided additional preliminary financial due diligence information to representatives of Omniture.

 

On September 25, 2007, a representative from Goldman Sachs was contacted by a party that had previously participated in the strategic transaction process and executed a confidentiality agreement, but which had declined to submit a preliminary indication of interest. This other party, referred to herein as Company B, indicated that it was interested in re-engaging in the strategic transaction process.

 

On September 26, 2007 and September 27, 2007, representatives of Goldman Sachs and Credit Suisse engaged in discussions regarding the potential financial terms of a merger transaction between Visual Sciences and Omniture.

 

On September 27, 2007, Mr. James conveyed in a telephone call to Mr. MacIntyre Omniture’s interest in pursuing an acquisition of Visual Sciences, and that it would be willing to pay merger consideration consisting of a mixture of both Omniture stock and cash. On September 28, 2007, a joint telephonic meeting of Visual Sciences’ board of directors and the transaction committee was held in which members of Visual Sciences’ management and representatives of Goldman Sachs and Latham & Watkins also participated. At this meeting, the board of directors and transaction committee reviewed and discussed the Omniture proposal and various other terms relating to a proposed merger with Omniture. At the conclusion of the meeting, the Visual Sciences board of directors authorized management to deliver a non-binding term sheet to, and to commence negotiation of the term sheet with, Omniture. On September 28, 2007, on behalf of Visual Sciences, Goldman Sachs sent an initial draft of the non-binding term sheet to Credit Suisse for delivery to Omniture.

 

On October 2, 2007, Omniture sent a revised non-binding term sheet to Visual Sciences. Between October 2, 2007 and October 9, 2007, Visual Sciences and Omniture, through their management and respective representatives, including representatives of Goldman Sachs, Credit Suisse, Latham & Watkins and Wilson Sonsini Goodrich & Rosati, Professional Corporation, or WSGR, outside counsel to Omniture, exchanged multiple drafts of the non-binding term sheet, and engaged in extensive negotiations.

 

On October 3, 2007, Mr. James spoke with Mr. MacIntyre by telephone to discuss the process for completing due diligence and definitive agreements for a transaction. On the call, Mr. MacIntyre also updated Mr. James on preliminary results for Visual Sciences’ third quarter ended September 30, 2007. Mr. MacIntyre requested that, in light of the stock portion of the consideration, Visual Sciences conduct due diligence with respect to Omniture. On October 3, 2007, certain members of Visual Sciences’ management provided a financial presentation to Omniture’s management.

 

Also on October 3, 2007, Company B submitted a financial and business due diligence request list to Visual Sciences. On October 4, 2007, Company B submitted a technology due diligence request list to Visual Sciences. On October 4, 2007, Company B was given access to an electronic data room containing Visual Sciences’ due diligence materials.

 

On October 5, 2007, Ms. Long participated in a financial due diligence call with representatives of Company B. Also on that day, Mr. MacIntyre and certain senior technical employees of Visual Sciences met with representatives of Company B to perform product demonstrations and permit Company B to conduct technical due diligence. Between October 6, 2007 and October 18, 2007, a representative of Goldman Sachs engaged in several telephone conversations with management of Company B regarding its interest in pursuing a possible transaction with Visual Sciences. Despite communication of an impending announcement of a transaction, no acquisition proposal was submitted by Company B.

On October 9, 2007, Visual Sciences and Omniture determined that the then-current draft of the non-binding term sheet served as an adequate basis to begin negotiation of a definitive merger agreement. The parties also agreed that additional due diligence activities would be performed. Later that day, Omniture and its representatives were granted access to portions of the electronic data room.

 

Following finalization of the non-binding term sheet, Latham & Watkins distributed to WSGR and Omniture a draft of the proposed merger agreement. On October 10, 2007, WSGR notified Latham & Watkins that Omniture intended to provide the first draft of the merger agreement that would serve as a basis for further negotiations. Also on that day, WSGR submitted a due diligence request list to Latham & Watkins on behalf of Omniture, and the parties held a conference call to organize due diligence and negotiation of the definitive agreements.

 

On October 11, 2007, the transaction committee held a telephonic meeting in which members of Visual Sciences’ management and representatives of Goldman Sachs and Latham & Watkins also participated. During the meeting, the transaction committee discussed certain types of confidential information that had been requested by Omniture in its due diligence request list, and the risks and benefits to Visual Sciences of sharing such confidential information. At the conclusion of the meeting, the transaction committee approved the disclosure of the documents requested by Omniture with certain exceptions for competitively sensitive confidential information. Later that day, Latham & Watkins submitted a due diligence request list on behalf of Visual Sciences to WSGR.

 

Also on October 11, 2007, WSGR distributed to Latham & Watkins the first draft of the merger agreement that WSGR had prepared. On October 13, 2007, Latham & Watkins distributed to WSGR its comments on the draft merger agreement previously provided by WSGR.

 

Between October 15, 2007 and October 17, 2007, a series of due diligence meetings were held between Visual Sciences and Omniture executives at the offices of Latham & Watkins in San Diego, California. Representatives of Goldman Sachs and Credit Suisse also attended these meetings. The topics discussed at such meetings included a company overview, sales and marketing, human resources, finance and accounting, information technology, operations, intellectual property, product design and product development, corporate strategy and legal matters. In addition, during the period from October 10, 2007 through October 25, 2007, Omniture conducted a legal and financial due diligence review of Visual Sciences through the electronic data room. During the same period, Visual Sciences conducted due diligence on Omniture.

 

On October 17, 2007, the transaction committee held a telephonic meeting in which members of Visual Sciences’ management and representatives of Goldman Sachs and Latham & Watkins also participated. Representatives of Latham & Watkins reported to the committee regarding the status of the negotiation of the merger agreement with Omniture and its counsel, reviewing the significant open issues between the parties. Later that evening after the meeting had concluded, WSGR distributed to Latham & Watkins a revised draft of the merger agreement.

 

Also, on October 17, 2007, the Omniture board of directors held a meeting to discuss the proposed transaction. All members of the Omniture board of directors attended the meeting, other than Gregory S. Butterfield, as well as Messrs. Herring, Dodd, and Lindquist and representatives of WSGR and Credit Suisse. At the meeting, representatives of WSGR reviewed with the board of directors their fiduciary duties in the context of the transaction. The representatives of Credit Suisse then provided a summary of the terms of the transaction and provided an overview of Visual Sciences and its historical and potential future financial performance, and various financial analyses of the transaction. Omniture management reviewed with the board of directors the strategic rationale for the transaction, risks related to the transaction and the results to date of their ongoing due diligence investigation. The Omniture board of directors authorized management to continue negotiations.

 

During the morning of October 19, 2007, the transaction committee held a telephonic meeting in which members of Visual Sciences’ management and representatives of Goldman Sachs and Latham & Watkins also participated. A representative of Latham & Watkins reported to the committee regarding the status of negotiations regarding the merger agreement with Omniture and its counsel, reviewing the significant open issues between the parties.

 

During the afternoon of October 19, 2007, Latham & Watkins and WSGR conducted extensive telephonic negotiations regarding the merger agreement, including, among other items, the scope of the representations and

warranties being made by each company, the covenants of each company prior to closing, and the conditions to closing the merger. Mr. Lindquist and Mr. Greenhalgh also participated in portions of these negotiations.

 

Early in the morning on October 20, 2007, Latham & Watkins distributed to WSGR a revised draft of the merger agreement. During the afternoon of October 20, 2007, Latham & Watkins and WSGR again conducted extensive telephonic negotiations regarding the merger agreement. Messrs. Lindquist and Greenhalgh also participated in portions of these negotiations. At the conclusion of these negotiations, the parties agreed to provide access to certain customer contracts of Visual Sciences to WSGR (but not Omniture) to perform a due diligence review thereof, subject to WSGR’s first entering into a confidentiality agreement with Visual Sciences which restricted WSGR from disclosing to Omniture any customer pricing information or other specific customer identifying information.

 

On October 21, 2007, Visual Sciences established data rooms containing certain of its contracts at the offices of Latham & Watkins in Menlo Park, California and San Diego, California. Also on October 21, 2007, representatives from Latham & Watkins and WSGR prepared and negotiated a confidentiality agreement between WSGR and Visual Sciences relating to WSGR’s review of certain customer contracts of Visual Sciences, which restricted WSGR from disclosing to Omniture any customer pricing information or other specific customer identifying information. Later that evening, WSGR distributed to Latham & Watkins a revised draft of the merger agreement.

 

On October 22, 2007, Visual Sciences and WSGR entered into the proposed confidentiality agreement. On October 23 and 24, 2007, representatives from WSGR conducted a due diligence review of Visual Sciences’ customer contracts at the data rooms.

 

On October 23, 2007, a joint telephonic meeting of Visual Sciences’ board of directors and the transaction committee was held in which members of Visual Sciences’ management and representatives of Goldman Sachs and Latham & Watkins also participated. At the request of the transaction committee, Mr. James, Mr. Herring, John Mellor, the Senior Vice President, Business Development of Omniture, and a representative from Credit Suisse made a presentation to the Visual Sciences board of directors and transaction committee regarding Omniture, including an overview of the company and its business, its management, its strategy, and its finances, as well as Omniture’s plans and vision for the combined company. After questions from and discussion with the Visual Sciences board of directors, the Omniture and Credit Suisse representatives then departed the meeting. Representatives of Goldman Sachs then discussed with the board of directors Goldman Sachs’ financial analysis of the proposed transaction with Omniture. A representative of Latham & Watkins then reported to the board of directors and the transaction committee regarding the status of the negotiations of the merger agreement with Omniture and its counsel and reviewed the significant open issues between the parties. The representative from Latham & Watkins also discussed with the board of directors and the transaction committee the summary of the merger agreement and voting agreements previously distributed by Latham & Watkins and reviewed with them the fiduciary duties of directors in connection with their consideration of the proposed merger transaction.

 

Also on October 23, 2007, the Omniture board of directors held a meeting to discuss the proposed transaction. All members of the Omniture board of directors attended the meeting, other than Gregory S. Butterfield, as well as Messrs. Herring, Dodd, and Lindquist and representatives of WSGR and Credit Suisse. At the meeting, the Omniture board of directors formally approved the engagement of Credit Suisse, pursuant to an engagement letter dated October 23, 2007. Representatives of Credit Suisse provided a detailed review of Visual Sciences and its historical and potential future financial performance, and reviewed its financial analyses of the proposed transaction. Representatives of WSGR then again reviewed with the Omniture board of directors their fiduciary duties, and provided a detailed summary of the merger agreement and voting agreements. Representatives of WSGR and management also provided a summary of their due diligence investigation of Visual Sciences. Omniture management also updated the board of directors on integration planning and the effect of the transaction on Omniture’s cash position. Credit Suisse then delivered its oral opinion, (which was subsequently confirmed in writing by delivery of Credit Suisse’s written opinion dated the same date) to the effect that, as of October 23, 2007, and based upon and subject to the various considerations described in its written opinion, the merger consideration to be paid in the merger was fair to Omniture, from a financial point of view. The full text of the written opinion of Credit Suisse, which sets forth, among other things, the procedures followed, assumptions made, matters considered and limitations on the review undertaken in connection with such opinion, is set forth as Annex C to this joint proxy

statement/prospectus. The Omniture board of directors then unanimously determined that the business combination with Visual Sciences was advisable and in the best interests of Omniture and its stockholders and approved the merger agreement and related resolutions, including the issuance of Omniture common stock in connection with the merger. The Omniture board of directors also authorized the submission to Omniture stockholders of the proposal to approve the issuance of Omniture common stock and recommended that Omniture stockholders vote “FOR” the proposal.

 

On October 24, 2007, Latham & Watkins and WSGR conducted extensive telephonic negotiations regarding the merger agreement, including, among other items, the scope of the representations and warranties being made by each company, the covenants of each company prior to closing and the closing conditions to the merger. Mr. Lindquist and Mr. Greenhalgh also participated in these negotiations. Latham & Watkins then distributed to WSGR a revised draft of the merger agreement early in the morning on October 25, 2007.

 

On the morning of October 25, 2007, a joint telephonic meeting of Visual Sciences’ board of directors and the transaction committee was held in which members of Visual Sciences’ management and representatives of Goldman Sachs and Latham & Watkins also participated. A representative of Latham & Watkins summarized for the board of directors and the transaction committee the status of negotiations regarding the merger agreement. Mr. MacIntyre reported to the board regarding his negotiations with Mr. James that morning concerning the remaining issues between the parties. At the meeting, representatives of Goldman Sachs presented their financial analyses of the Omniture proposal and delivered to the Visual Sciences board of directors Goldman Sachs’ oral opinion, which was subsequently confirmed by delivery of a written opinion dated October 25, 2007, that, as of such date and based upon and subject to the factors and assumptions set forth therein, the stock consideration and the cash consideration to be received by the holders of shares of Visual Sciences common stock, taken in the aggregate, pursuant to the merger agreement was fair from a financial point of view to such holders. The full text of the written opinion of Goldman Sachs, which sets forth the assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with such opinion, is set forth as Annex D to this joint proxy statement/prospectus. A representative of Latham & Watkins then reviewed with the board of directors the terms of the proposed merger agreement and voting agreements. The board of directors and transaction committee then discussed the risks and benefits of entering into the merger transaction with Omniture, as well as the risks and challenges of operating as an independent company. The members of the transaction committee present at the meeting then unanimously agreed that the merger be submitted to the board of directors of Visual Sciences for its approval. Following further discussion, the members of the board of directors present at the meeting, acting unanimously: determined that the merger was fair to, and in the best interests of, Visual Sciences and its stockholders and declared the merger to be advisable; authorized management to resolve the remaining issues and to finalize, execute and deliver the merger agreement; directed that the merger agreement be submitted to the stockholders of Visual Sciences for adoption at a special meeting of stockholders; and recommended that Visual Sciences stockholders vote “FOR” the adoption of the merger agreement. The Visual Sciences board of directors then temporarily adjourned the meeting until later that evening.

 

During the late morning and early afternoon of October 25, 2007, WSGR and Latham & Watkins engaged in additional telephonic negotiations to finalize the merger agreement.

 

After the close of trading on October 25, 2007, Visual Sciences and Omniture executed the merger agreement. Shortly thereafter, Visual Sciences and Omniture issued a joint press release announcing the execution of the merger agreement.

 

Early in the evening of October 25, 2007, the Visual Sciences board of directors resumed its special telephonic meeting. A representative of Latham & Watkins noted that the merger agreement had been distributed to the board of directors and summarized for the board members the resolution of the remaining issues regarding the agreement, and the board members attending the meeting unanimously ratified, confirmed and approved: the adoption of the merger agreement; the prior determination by the board of directors that the merger was fair to, and in the best interests of, Visual Sciences and its stockholders and the declaration that the merger was advisable; the board of directors’ direction that the merger agreement be submitted to the stockholders of Visual Sciences for adoption at a special meeting of stockholders; and the board of directors’ recommendation that Visual Sciences stockholders vote “FOR” the adoption of the merger agreement.

 

Consideration of the Merger by the Omniture Board of Directors

 

At a meeting held on October 23, 2007, the Omniture board of directors unanimously:

 

 

The Omniture board of directors believes that the following are reasons the merger is expected to be beneficial to Omniture and its stockholders:

 

 

In reaching its decision to approve the issuance of Omniture common stock in connection with the merger, the Omniture board of directors consulted with Omniture’s management, Omniture’s legal counsel and other advisors and took into account the opinion of Omniture’s financial advisor with respect to the fairness, from a financial point of view to Omniture, of the merger consideration to be paid by Omniture pursuant to the merger agreement. The factors that the Omniture board of directors considered in reaching its determination include, but were not limited to, the following:

 

 

 

In addition, the Omniture board of directors also identified and considered a variety of potentially negative factors in its deliberations concerning the merger, including, but not limited to:

 

 

The above discussion of the material factors considered by the Omniture board of directors is not intended to be exhaustive, but does set forth the principal factors considered by the Omniture board of directors. The Omniture board of directors collectively reached the conclusion to approve the merger agreement in light of the various factors described above and other factors that each member of the Omniture board of directors felt were appropriate. In view of the wide variety of factors considered by the Omniture board of directors in connection with its evaluation of the merger and the complexity of these matters, the Omniture board of directors did not consider it practical, and did not attempt, to quantify, rank or otherwise assign relative weights to the specific factors it considered in reaching its decision. Rather, the Omniture board of directors made its recommendation based on the totality of information

presented to, and the investigation conducted by, it. In considering the factors discussed above, individual directors may have given different weights to different factors.

 

Recommendation of the Omniture Board of Directors

 

After careful consideration and based on the foregoing analysis at a meeting of the Omniture board of directors held on October 23, 2007, the Omniture board of directors determined that the merger is advisable, and is fair to and in the best interests of Omniture and its stockholders, and unanimously approved the merger agreement, the consummation of the merger and the issuance of Omniture common stock in connection with the merger. The Omniture board of directors unanimously recommends that the Omniture stockholders vote “FOR” the issuance of Omniture common stock in connection with the merger agreement.

 

Opinion of Omniture’s Financial Advisor

 

Omniture retained Credit Suisse Securities (USA) LLC, which we refer to as Credit Suisse, to act as its exclusive financial advisor in connection with the proposed merger. In connection with Credit Suisse’s engagement, Omniture requested that Credit Suisse evaluate the fairness, from a financial point of view, to Omniture of the merger consideration to be paid by Omniture pursuant to the merger agreement. On October 23, 2007, the Omniture board of directors met to review the proposed merger. During this meeting, Credit Suisse reviewed with the Omniture board of directors certain financial analyses, as described below, and rendered its oral opinion to the Omniture board of directors, which opinion was subsequently confirmed by delivery of a written opinion dated as of October 23, 2007, to the effect that, as of that date and based on and subject to the considerations described in the Credit Suisse opinion, the merger consideration to be paid in the merger was fair to Omniture, from a financial point of view.

 

The full text of the Credit Suisse opinion, which sets forth, among other things, the procedures followed, assumptions made, matters considered and limitations on the scope of the review undertaken by Credit Suisse in rendering its opinion, is attached as Annex C to this joint proxy statement/prospectus and is incorporated by reference in its entirety. Holders of Omniture common stock are urged to read this opinion carefully and in its entirety.

 

The Credit Suisse opinion addresses only the fairness, from a financial point of view, to Omniture of the merger consideration to be paid in the merger. The Credit Suisse opinion does not address any other aspect of the proposed merger and does not constitute a recommendation to any stockholder as to how such stockholder should vote or act on any matter relating to the merger. The summary of the Credit Suisse opinion in this joint proxy statement/prospectus is qualified in its entirety by reference to the full text of the Credit Suisse opinion.

 

In arriving at its opinion, Credit Suisse, among other things:

 

 

 

In connection with its review, Credit Suisse did not assume any responsibility for independent verification of any of the foregoing information and relied on such information being complete and accurate in all material respects. With respect to the financial forecasts for Visual Sciences that Credit Suisse reviewed and which were prepared by the management of Omniture, the management of Omniture advised Credit Suisse, and Credit Suisse assumed, that such forecasts were reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of Omniture as to the future financial performance of Visual Sciences after giving effect to the merger. With respect to the publicly available financial forecasts for Omniture that Credit Suisse reviewed, the management of Omniture advised Credit Suisse, and Credit Suisse assumed, that such publicly available financial forecasts represented reasonable estimates and judgments as to the future financial performance of Omniture. In addition, Credit Suisse relied upon, without independent verification, the assessment of the management of Omniture as to (i) its ability to retain key employees, (ii) the strategic benefits and potential cost savings and other synergies (including the amount, timing and achievability thereof) anticipated to result from the merger, (iii) the existing technology, products and services of Visual Sciences and Omniture and the validity of, and risks associated with, the future technology, products and services of Visual Sciences and Omniture, and (iv) the ability of Omniture to integrate the businesses of Visual Sciences and Omniture. Credit Suisse assumed, with the consent of Omniture, that the merger will be treated as a tax-free reorganization for federal income tax purposes. Credit Suisse also assumed, with the consent of Omniture, that in the course of obtaining any necessary regulatory and third party approvals and consents for the merger, no modification, delay, limitation, restriction or condition will be imposed that will have an adverse effect on Omniture or Visual Sciences or the contemplated benefits of the merger and that the merger will be consummated in accordance with the terms of the merger agreement reviewed by Credit Suisse, without waiver, modification or amendment of any term, condition or agreement therein material to its analyses. Representatives of Omniture advised Credit Suisse, and Credit Suisse further assumed, that the merger agreement when executed would conform to the draft reviewed by Credit Suisse in all respects material to its analysis. In addition, Credit Suisse was not requested to make, and did not make, an independent evaluation or appraisal of the assets or liabilities (contingent or otherwise) of Visual Sciences or Omniture, nor has Credit Suisse been furnished with any such evaluations or appraisals. Credit Suisse’s opinion addressed only the fairness, from a financial point of view, to Omniture of the merger consideration to be paid in the merger and did not address any other aspect or implication of the merger or any other agreement, arrangement or understanding entered into in connection with the merger or otherwise. Credit Suisse’s opinion was necessarily based upon information made available to Credit Suisse as of the date of such opinion, and upon financial, economic, market and other conditions as they existed and could be evaluated on such date. The issuance of Credit Suisse’s opinion was approved by an authorized internal committee. Credit Suisse did not express any opinion as to what the value of the shares of Omniture common stock actually will be when issued to holders of Visual Sciences common stock pursuant to the merger or the prices at which such shares of Omniture common stock will trade at any time. Credit Suisse’s opinion did not address the relative merits of the merger as compared to other business strategies or transactions that might be available to Omniture, nor did it address the underlying business decision of Omniture to proceed with the merger.

 

In preparing its opinion to the Omniture board of directors, Credit Suisse performed a variety of financial and comparative analyses. The preparation of a fairness opinion is a complex process involving various determinations as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances and, therefore, a fairness opinion is not readily susceptible to partial analysis or summary description. In arriving at its opinion, Credit Suisse made qualitative judgments with respect to the analyses and factors that it considered. Credit Suisse arrived at its ultimate opinion based on the results of all analyses undertaken by it and assessed as a whole and did not draw, in isolation, conclusions from or with regard to any one factor or method of analysis. Accordingly, Credit Suisse believes that its analyses must be considered as a whole and that selecting portions of its analyses and factors or focusing on information presented in tabular format, without considering all analyses and factors or the narrative description of the analyses, could create a misleading or incomplete view of the processes underlying its analyses and opinion.

In its analyses, Credit Suisse considered industry performance, general business, economic, market and financial conditions and other matters, many of which are beyond the control of Visual Sciences and Omniture. No company, transaction or business used by Credit Suisse in its analyses as a comparison is identical to Omniture or Visual Sciences or the proposed merger, and an evaluation of the results of those analyses is not entirely mathematical. Rather, the analyses involve complex considerations and judgments concerning financial and operating characteristics and other factors that could affect the acquisition, public trading or other values of the companies, business segments or transactions analyzed. The estimates contained in the analyses performed by Credit Suisse and the ranges of valuations resulting from any particular analysis are not necessarily indicative of actual values or predictive of future results or values, which may be significantly more or less favorable than those suggested by the analyses. In addition, analyses relating to the value of businesses or securities do not purport to be appraisals or to reflect the prices at which businesses or securities actually may be sold. Accordingly, the estimates used in, and the results derived from, the analyses performed by Credit Suisse are inherently subject to substantial uncertainty.

 

The opinion of Credit Suisse and its financial analyses were only one of many factors considered by the Omniture board of directors in its evaluation of the proposed merger and should not be viewed as determinative of the views of the Omniture board of directors or management with respect to the merger or the merger consideration.

 

The following is a summary of the material financial analyses performed by Credit Suisse in connection with the preparation of its opinion and reviewed with the Omniture board of directors at a meeting of the Omniture board of directors on October 23, 2007. The financial analyses summarized below include information presented in tabular format. In order to fully understand the financial analyses performed by Credit Suisse, the tables must be read together with the text of each summary. The tables alone do not constitute a complete description of the financial analyses. Considering the data in the tables below without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of the financial analyses performed by Credit Suisse.

 

Discounted Cash Flow Analysis

 

Credit Suisse calculated the estimated present value of the unlevered, after-tax free cash flows that Visual Sciences could generate over calendar years 2008 through 2012, based on adjustments made by Omniture’s management to estimates for the future financial performance of Visual Sciences provided by Visual Sciences’ management (referred to herein as the Visual Sciences Adjusted Estimates). Credit Suisse then calculated a range of estimated terminal values based on a next twelve month earnings before interest, taxes, depreciation and amortization (EBIDTA) multiple range of 14x to 18x. The estimated after-tax free cash flows and terminal values were then discounted to the present value using discount rates ranging from 11% to 15%.

 

The following summarizes the range of prices per share of Visual Sciences common stock and exchange ratios, adjusted to reflect a cash payment of $2.39 per share and based on the closing price of Omniture common stock on October 19, 2007 of $33.02 (referred to as the adjusted exchange ratios) implied by this analysis:

 

 

Credit Suisse compared the implied prices per share of Visual Sciences common stock and the implied adjusted exchange ratios to the price per share of Visual Sciences common stock in the merger of $18.57 and the merger exchange ratio of 0.490x. For purposes of its analyses, Credit Suisse assumed that the merger exchange ratio was net of the $2.39 in cash, without interest, per share of Visual Sciences common stock to be paid in the merger, and based its analyses on the closing price of $33.02 per share of Omniture common stock on October 19, 2007.

 

Relative Discounted Cash Flow Analysis

 

Credit Suisse performed a relative discounted cash flow analysis. In general, Credit Suisse compared the results of its discounted cash flow analysis of Visual Sciences to the discounted cash flow analysis of Omniture derived by Credit Suisse from publicly available research analyst estimates of Morgan Stanley & Co. Incorporated

(referred to as the Omniture Street Case Estimates) to derive a range of implied prices per share of Visual Sciences common stock and adjusted exchange ratios, which are summarized below:

 

 

Credit Suisse compared the implied prices per share of Visual Sciences common stock and the implied adjusted exchange ratios to the price per share of Visual Sciences common stock in the merger of $18.57 and the merger exchange ratio of 0.490x. For purposes of its analyses, Credit Suisse assumed that the merger exchange ratio was net of the $2.39 in cash, without interest, per share of Visual Sciences common stock to be paid in the merger, and based its analyses on the closing price of $33.02 per share of Omniture common stock on October 19, 2007.

 

 

The selected companies were chosen because they are publicly traded companies that operate in similar industries to Visual Sciences and have similar lines of business and/or business models to Visual Sciences. Multiples for the selected companies and Visual Sciences were based on closing stock prices as of October 19, 2007. Estimated financial data for the selected companies were based on publicly available equity research analysts’ estimates. Estimated financial data for Visual Sciences were based on publicly available research analyst estimates of JMP Securities LLC (referred to as the Visual Sciences Street Case Estimates).

 

Credit Suisse reviewed the fully diluted aggregate value (calculated as fully diluted equity value plus net debt) as multiples of revenue or EBITDA for calendar years 2007 and 2008. Credit Suisse also reviewed the estimated quotient of price to calendar year 2008 earnings ratio divided by the long-term projected growth rate, or PEG. Credit Suisse applied ranges of selected revenue, EBITDA and PEG multiples derived from the financial data observed for the selected companies to corresponding data for Visual Sciences. This analysis indicated the following range of implied prices per share of Visual Sciences common stock and adjusted exchange ratios:

 

 

Credit Suisse compared the implied prices per share of Visual Sciences common stock and the implied adjusted exchange ratios to the price per share of Visual Sciences common stock in the merger of $18.57 and the merger exchange ratio of 0.490x. For purposes of its analyses, Credit Suisse assumed that the merger exchange ratio

was net of the $2.39 in cash, without interest, per share of Visual Sciences common stock to be paid in the merger, and based its analyses on the closing price of $33.02 per share of Omniture common stock on October 19, 2007.

 

Selected Transactions Analysis

 

Using publicly available information, Credit Suisse reviewed several financial metrics of the following 29 selected transactions in the business intelligence and web analytics industry and the following 21 transactions in the on-demand software industry: