SKUL Skullcandy, Inc. (MM)

13D

13D

13D

13D

This Amendment No. 3 to the joint statement on Schedule 13D with respect to the common stock, $0.0001 par value (the “ Common Stock ”), of Skullcandy, Inc., a Delaware corporation (the “ Issuer ”), filed by Thomas E. Lynch, Scott P. Scharfman, Mill Road Capital II GP LLC, a Delaware limited liability company, and Mill Road Capital II, L.P., a Delaware limited partnership (collectively, the “ Reporting Persons ”), on June 24, 2016, as amended by Amendment No. 1 on Schedule 13D with respect to the Common Stock filed by the Reporting Persons on July 25, 2016 and as amended by Amendment No. 2 on Schedule 13D with respect to the Common Stock filed by the Reporting Persons on August 15, 2016 (such joint statement, as so amended and as amended herein, the “ Schedule 13D ”), amends the Schedule 13D as follows.

Introduction

This Amendment No. 3 relates to the letter dated August 17, 2016 from Mill Road Capital Management LLC (the “ Management Company ”) to the members of the Issuer’s board of directors (the “ August 17 Proposal ”), proposing to acquire 100% of the fully diluted stock of the Issuer for cash consideration of $6.35 per share, payable at closing (the “ Merger ”), pursuant to a proposed form of Agreement and Plan of Merger (the “ Merger Agreement ”) by and among MRSK Hold Co., a Delaware corporation (“ Parent ”), MRSL Merger Co., a Delaware corporation and wholly owned subsidiary of Parent (“ Merger Sub ”), and the Issuer.

The foregoing description of the August 17 Proposal does not purport to be complete and is qualified in its entirety by reference to the terms and conditions of the August 17 Proposal, a copy of which is filed as  Exhibit 15 to this Schedule 13D and is incorporated by reference in its entirety into this Introduction.

“On August 15, 2016, the Management Company sent an unsolicited proposal to the members of the Issuer’s board of directors, proposing to acquire 100% of the fully diluted stock of the Issuer for cash consideration of $6.25 per share, a copy of which is filed as Exhibit 10 to this Schedule 13D.

On August 17, 2016, the Management Company sent the August 17 Proposal to the members of the Issuer’s board of directors, proposing to acquire 100% of the fully diluted stock of the Issuer for cash consideration of $6.35 per share, payable at closing, pursuant to the Merger Agreement. The Management Company anticipates that the Merger will be structured as a tender offer followed promptly by a merger effected pursuant to Section 251(h) of the Delaware General Corporation Law, identical to the current structure agreed to by the Issuer pursuant to its existing June 23, 2016 Agreement and Plan of Merger with Incipio, LLC and Powder Merger Sub, Inc. (as amended to date, the “ Existing Merger Agreement ”). Parent and Merger Sub are prepared to sign a definitive merger agreement in the form of the Merger Agreement, including terms and conditions substantially identical to the Existing Merger Agreement. The foregoing descriptions of the August 17 Proposal and the Merger Agreement do not purport to be complete and are qualified in their entirety by reference to the terms and conditions of the August 17 Proposal and the Merger Agreement, copies of which are filed as Exhibit 15 and

Exhibit 16 , respectively, to this Schedule 13D and are incorporated by reference in their entirety into this Item 4.”

“The percentages of beneficial ownership reported in this Item 5, and on each Reporting Person’s cover page to this Schedule 13D, are based on a total of 28,746,664 shares of the Common Stock issued and outstanding as of July 29, 2016, as reported in the most recent quarterly report of the Issuer on Form 10-Q for the quarter ended June 30, 2016. All of the share numbers reported below, and on each Reporting Person’s cover page to this Schedule 13D, are as of August 17, 2016, unless otherwise indicated. The cover page to this Schedule 13D for each Reporting Person is incorporated by reference in its entirety into this Item 5(a, b).”

“No Reporting Person has effected any transaction in shares of the Common Stock since August 15, 2016 (the date of the filing of Amendment No. 2 to the Schedule 13D).”

Signature

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.