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Form 6-K EZCHIP SEMICONDUCTOR For: Nov 04

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November 4, 2015 9:52 AM EST
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
 
For the Month of November 2015

Commission File Number 000-20860
 
EZchip Semiconductor Ltd.
(Translation of registrant’s name into English)

1 Hatamar Street, P.O.B. 527, Yokneam 20692, Israel
 (Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F x   Form 40-F ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes ¨   No x

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-_

 
 
 
EXPLANATORY NOTE

On November 4, 2015, EZchip Semiconductor Ltd. (the “Company”) issued a press release titled “EZchip Responds to Glass Lewis & Co Report.” A copy of the press release is annexed hereto as Exhibit 99.1.

In addition, on November 4, 2015, the Company mailed to its shareholders a notice titled “EZCHIP SETS THE RECORD STRAIGHT.”  A copy of such notice is annexed hereon to as Exhibit 99.2.

The information in this explanatory note shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, and it shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or under the Exchange Act, whether made before or after the date hereof, except as expressly set forth by specific reference to Form 6-K.
 
 
2
 
SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
EZchip Semiconductor Ltd.

By:
/S/ Dror Israel
Name:
Dror Israel
Title:
Chief Financial Officer

Date: November 4, 2015
 
 
3
 
Exhibit Index
 
Exhibit 99.1
  
Press Release of the Company, dated November 4, 2015, titled “EZchip Responds to Glass Lewis & Co Report.”
Exhibit 99.2
  
Notice of the Company titled “EZCHIP SETS THE RECORD STRAIGHT.”

4
 
Exhibit 99.1
 
FOR IMMEDIATE RELEASE

EZchip Responds to Glass Lewis & Co Report

Company Urges Shareholders to Vote “FOR” the Merger Proposal that Provides
EZchip Shareholders with Compelling and Immediate Value

YOKNEAM, ISRAEL, November 04, 2015 - EZchip Semiconductor Ltd. (“EZchip” or the “Company”) (NASDAQ: EZCH), a leader in high-performance processing solutions for carrier and data center networks, today issued the following statement in response to a report issued by Glass Lewis & Co. (“Glass Lewis”) regarding the Merger Proposal with Mellanox Technologies, Ltd. (“Mellanox”).

Although we disagree with its conclusion, we note that Glass Lewis recognizes1:

 
Ø
CERTAINTY OF VALUE IN A CONSOLIDATING INDUSTRY: “From the onset, we recognize that the Company operates as a relatively smaller player in a competitive, dynamic and consolidating industry, relying in large part on a few significant customers. In our view, these factors could reasonably lead the board to conclude that selling the Company, particularly at a certain and immediate all-cash price, may be the best way to maximize shareholder value, compared to the primary alternative of continuing to operate on a standalone basis.”

 
Ø
FAIR VALUE: “The purchase price for EZchip also looks particularly favorable when compared to prior transactions on the basis of trailing multiples.”

 
Ø
RAGING’S INTERESTS ARE DIFFERENT FROM OTHER SHAREHOLDERS: “It should be highlighted that Raging Capital has purchased put options which protect it from a drop in EZchip's share price below $25. We recognize that the vast majority of other EZchip shareholders probably don't have similar protection and likely remain exposed to such a price decline.”

Still, we strongly believe that Glass Lewis reached the wrong conclusion in failing to recommend that EZchip shareholders vote FOR the proposed transaction with Mellanox.  The EZchip Board carefully, in full exercise of its fiduciary duty to all shareholders, managed the sale process to obtain the highest price available and has not been approached by any other potential buyer since the public announcement of the merger agreement on September 30, 2015. In fact, in its report, Glass Lewis recommended that EZchip shareholders vote FOR ALL EZCHIP DIRECTOR NOMINEES AND AGAINST RAGING CAPITAL’S NOMINEES, stating:

 
Ø
“We do not believe there are substantial issues for shareholder concern as to any of the nominees. Accordingly, we recommend that shareholders vote FOR all incumbent nominees.”

 
Ø
“In our view, Mr. McWilliams’ lack of public company board experience and Mr. Traub’s nomination by Raging Capital in multiple other activism campaigns raises reasonable doubt as to whether these individuals are more qualified or better suited to serve as EZchip directors other than any of the Company’s current directors.”
 
EZchip’s Board has been intently focused on maximizing shareholder value and remains confident that the offer from Mellanox represents an attractive valuation for EZchip.
 
 1 Permission to use quotations neither sought nor obtained
 
 
 
 
 
 
INDEPENDENT ADVISORY FIRMS AGREE WITH EZCHIP

The Company notes that Institutional Shareholder Services (“ISS”), a leading proxy advisory firm in the U.S., and Entropy Financial Research Services Ltd. (“Entropy”), a leading independent provider of proxy advisory services in Israel, have recommended that EZchip shareholders vote FOR the Merger Proposal with Mellanox Technologies, Ltd. (“Mellanox”).2

As previously announced in its October 29, 2015 report, ISS stated:

 
Ø
“A vote FOR this proposal is warranted given:
 
·
The reasonable valuation multiples;
 
·
The downside potential in an adverse scenario for sales of NPS-400.”

 
Ø
“…The offer price of USD 25.50 in cash provides reasonable compensation for giving up the potential upside in a successful turnaround.”

 
Ø
“Raging Capital highlights the significant upside for shareholders with good execution, though there might also be significant downside from the offer of USD 25.50 if EZchip does not succeed in replacing lost revenues fast enough.”

As previously announced in its November 02, 2015 report, Entropy stated:

 
Ø
“In conclusion, as we examine this transaction, we believe that the alignment of interests of the CEO of the Company, who is also its largest individual shareholder, the fact that the transaction was done at a price higher than the market price at the time of its announcement and the lack of any higher proposal thus far from any competitor, indicate that the price offered by Mellanox is beneficial to all of EZchip's shareholders.”

The Company also noted that like Glass Lewis, ISS and Entropy recommended that EZchip shareholders vote FOR ALL of the Company’s experienced director nominees and AGAINST Raging Capital's two director nominees at the Company's upcoming Annual General Meeting of Shareholders.

YOUR VOTE IS IMPORTANT – PLEASE VOTE FOR THE MELLANOX TRANSACTION TODAY

Your vote is extremely important, no matter how many or how few shares you own.  If you have NOT already voted, please IMMEDIATELY vote FOR the Merger Proposal and FOR ALL of EZchip’s experienced director nominees and AGAINST Raging Capital’s two director nominees to ensure that your vote will be received in time. Please do not return or otherwise vote any GOLD proxy card sent to you by Raging Capital. Even if you have previously voted against the merger or for Raging Capital’s nominees, you have every right to change your vote. Only your latest dated, validly executed vote will count.
 
 
2 Permission to use quotations neither sought nor obtained

 
 
 
 
If you have any questions about the Annual General Meeting or need assistance in voting your shares, please contact the Company’s proxy solicitor, MacKenzie Partners, at Toll-free: (800) 322-2885 or Collect: (212) 929-5500.

About EZchip
EZchip is a fabless semiconductor company that provides high-performance processing solutions for a wide range of applications for the carrier, cloud and data center networks. EZchip’s broad portfolio of solutions scales from a few to hundreds of Gigabits-per-second, and includes network processors, multi-core processors, intelligent network adapters, high-performance appliances and a comprehensive software ecosystem. EZchip’s processing solutions excel at providing great flexibility and high performance coupled with superior integration and power efficiency.

Safe Harbor Statement
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.Forward-looking statements are statements that are not historical facts and may include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, products and services, and statements regarding future performance and the consummation of the merger with Mellanox Technologies, Ltd.These statements are only predictions based on EZchip's current expectations and projections about future events based on its current knowledge.There are important factors that could cause EZchip's actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements.Those factors include, but are not limited to, the impact of general economic conditions, competitive products (including in-house customer developed products), product demand and market acceptance risks, customer order cancellations, reliance on key strategic alliances, fluctuations in operating results, delays in development of highly-complex products and other factors indicated in EZchip's filings with the Securities and Exchange Commission (SEC).For more details, refer to EZchip's SEC filings and the amendments thereto, including its Annual Report on Form 20-F filed on March 31, 2015 and its Current Reports on Form 6-K (including EZchip’s Proxy Statement, dated October 13, 2015 (as supplemented on October 26, 2015)). EZchip undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or to changes in our expectations, except as may be required by law.

Important Additional Information
This communication is neither an offer to purchase nor a solicitation of an offer to sell securities. Shareholders are urged to read the Proxy Statement, dated October 13, 2015 (as supplemented on October 26, 2015), together with the Merger Agreement and other exhibits thereto, in their entirety because they contain important information. The Proxy Statement, dated October 13, 2015 (including the Merger Agreement with Mellanox Technologies, Ltd. and the fairness opinion received by the EZchip Board), has been filed by EZchip with the SEC and mailed to shareholders. The Supplement to the Proxy Statement, dated October 26, 2015, has been filed by EZchip with the SEC and is being mailed to shareholders. Shareholders may also obtain a free copy of these statements and other documents filed by EZchip with the SEC at the website maintained by the SEC at www.sec.gov by directing such requests to:
 
 
 
 
 
MacKenzie Partners, Inc.
Toll-free: (800) 322-2885
Collect: (212) 929-5500
 
Contacts

EZchip Investor Contact
Jeffrey A Schreiner
EZchip
+1-408-520-3676

EZchip PR Contact
Daureen Green
EZchip
+972-4-959-6677

Additional Contacts
Joele Frank, Wilkinson Brimmer Katcher
Eric Brielmann / Kate Beers
415-869-3950
Sharon Stern / Adam Pollack
212-355-4449

MacKenzie Partners, Inc.
Bob Marese
212-929-5405
 
 

Exhibit 99.2

 (Graphic)

EZchip Sets the Record Straight

FINANCIAL BENEFITS OF VOTING FOR THE TRANSACTION BOARD SUPPORT

What does Immediate and

Unanimously approved by

Certain Value EZchip’s Board of Directors

$25.50 per share mean?

Full and Fair Culmination of a comprehensive

Valuation for EZchip process and extensive

Shareholders negotiations by the EZchip Board

+31% Eliminates execution risks for EZchip continuing on a premium over 3-month volume-weighted average closing price standalone basis +33% prior to transaction announcement

“As the founder of EZchip over 15 years ago premium over 12-month volume-and its largest individual shareholder, my weighted average closing price +16% interests are aligned with yours. I believe in prior to transaction announcement premium over closing price on the merits of this transaction and the value September 29, 2015 (last trading day that it creates for EZchip shareholders.” prior to transaction announcement)

– Eli Fruchter, CEO, EZchip

IMPORTANT FACTS TO CONSIDER ABOUT YOUR INVESTMENT IN EZCHIP

Although there is potential for our NPS-400 and Tile-MX product lines, THERE ARE CHALLENGES.

Potential revenue streams Mellanox deal recognizes The semiconductor Proposed transaction from unproven products NPS/Tile-MX value, industry is a highly provides meaningful are always fraught with following decline in competitive market where synergies on a combined risk. Potential for future market value for legacy scale will be a deciding basis vs. operating as investor disappointment if NP products after Cisco’s factor between winners stand-alone company expectations are not realized decision to go in-house and losers

The Mellanox transaction provides CERTAIN VALUE and REWARDS SHAREHOLDERS. This transaction is about joining forces to create a true powerhouse for connectivity and processing, which is extremely important in an industry as competitive as ours.

Vote FOR the Merger Proposal With Mellanox Technologies Ltd.

If you have any questions or need assistance in voting your shares, please contact our proxy solicitor:

MacKenzie Partners, Inc. / 1.800.322.2885 (toll-free) / 1.212.929.5500 (call collect) / [email protected]

 
 

 (Graphic)

Leading Proxy Advisory Firms and Independent Analysts in Favor of Merger Proposal ISS and Entropy, leading proxy advisory firms in the US and Israel respectively, recommend a vote FOR the merger proposal, and a vote AGAINST Raging Capital’s Director nominees: “The offer price of USD 25.50 in cash provides reasonable compensation for giving up the potential upside in a successful turnaround.”“A vote FOR this proposal is warranted given:• The reasonable valuation multiples;•The downside potential in an adverse scenario for sales of NPS-400.” “...it appears that Raging Capital has hedged its position in EZchip through acquiring, at USD 25, put options expiring after the AGM. This strategy creates a potential misalignment of interests with EZchip other shareholders who are not protected with similar put options in the case that the merger does not go ahead.” “...support for the election of the two [Raging Capital] candidates is not warranted.”ENTROPY “...we believe that the alignment of interests of the CEO of the Company, who is also its largest individual shareholder, the fact that the transaction was done at a price higher than the market price at the time of its announcement and the lack of any higher proposal thus far from any competitor, indicate that the price offered by Mellanox is bene3cial to all of EZchip’s shareholders.” September 30, 2015 “We agree with management that EZChip would be better positioned within a larger, more diversi3ed company.”September 30, 2015 we view the acquisition as a positive and note that Mellanox has a good track record for integrating prior acquisitions.” September 30, 2015 We liked the candor in management's re3ection on the anticipated loss of Cisco revenues some years out and the steps necessary to potentially 3ll the gap.”*Permission to use quotations neither sought nor obtained. Emphasis added. PROTECT YOUR INVESTMENT Raging Capital’s interests are SIGNIFICANTLY DIFFERENT from yours.Follow the ISS and Entropy Recommendations Vote FOR the Merger Proposal with Mellanox Technologies Ltd. and FOR ALL of EZchip’s Highly Qualified and Experience Director Nominees If you have any questions or need assistance in voting your shares, please contact our proxy solicitor:MacKenzie Partners, Inc. / 1.800.322.2885 (toll-free) / 1.212.929.5500 (call collect) / [email protected]

 
 

 (Graphic)

SAFE HARBOR STATEMENT

This communication contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.3Forward-looking statements are statements that are not historical facts and may include 3nancial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, products and services, and statements regarding future performance and the consummation of the merger with Mellanox Technologies, Ltd.3These statements are only predictions based on EZchip's current expectations and projections about future events based on its current knowledge.3There are important factors that could cause EZchip's actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements.3Those factors include, but are not limited to, the impact of general economic conditions, competitive products (including in-house customer developed products), product demand and market acceptance risks, customer order cancellations, reliance on key strategic alliances, 3uctuations in operating results, delays in development of highly-complex products and other factors indicated in EZchip's 3lings with the Securities and Exchange Commission (SEC).3For more details, refer to EZchip's SEC 3lings and the amendments thereto, including its Annual Report on Form 20-F 3led on March331, 2015 and its Current Reports on Form 6-K (including EZchip’s Proxy Statement, dated October 13, 2015 (as supplemented on October 26, 2015)). EZchip undertakes no obligation to update forward-looking statements to re3ect subsequent occurring events or circumstances, or to changes in our expectations, except as may be required by law.

3IMPORTANT ADDITIONAL INFORMATION

This communication is neither an offer to purchase nor a solicitation of an offer to sell securities. Shareholders are urged to read the Proxy Statement, dated October 13, 2015 (as supplemented on October 26, 2015), together with the Merger Agreement and other exhibits thereto, in their entirety because they contain important information. The Proxy Statement, dated October 13, 2015 (including the Merger Agreement with Mellanox Technologies, Ltd. and the fairness opinion received by the EZchip Board), has been 3led by EZchip with the SEC and mailed to shareholders.3 The Supplement to the Proxy Statement, dated October 26, 2015, has been 3led by EZchip with the SEC and is being mailed to shareholders.3 Shareholders may also obtain a free copy of these statements and other documents 3led by EZchip with the SEC at the website maintained by the SEC at www.sec.gov3by directing such requests to:3

MacKenzie Partners, Inc.

Toll-free: (800) 322-2885 Collect: (212) 929-5500 [email protected]

 

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