UNITED STATES SECURITIES AND EXCHANGE COMMISSION

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 814, 2012

DEMANDTEC, INC.

(Exact Name of Registrant as Specified in Charter)

Delaware		001-33634		94-3344761
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(I.R.S. Employer Identification No.)

One Franklin Parkway, Building 910

San Mateo, CA 94403

(Address of principal executive offices and zip code)

Registrant’s telephone number, including area code: (650) 645-7100

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 82.01. ~~Other~~Completion ~~Events~~of Acquisition or Disposition of Assets.

OnAs ~~February~~previously 8disclosed, ~~2012~~DemandTec, Inc., a Delaware corporation (“DemandTec”), entered into aan ~~memorandum~~Agreement ~~of understanding with plaintiff~~ and ~~other~~Plan ~~named~~of ~~defendants~~Merger ~~regarding~~ (the ~~settlement~~“Merger ofAgreement”), adated ~~putative~~as ~~class~~of ~~action~~December 7, ~~lawsuit~~2011, ~~filed~~with inInternational ~~the~~Business ~~Superior~~Machines ~~Court~~Corporation of(“IBM”) ~~California,~~and ~~Santa~~Cudgee ~~Clara~~Acquisition ~~County~~Corp. (~~the~~ “~~Court~~Sub”), asa ~~well~~wholly asowned ~~the~~subsidiary ~~settlement~~ of ~~all~~IBM. ~~related~~On ~~claims~~February 14, ~~that~~2012, ~~were~~at ora ~~could~~special ~~have~~meeting ~~been~~of ~~asserted~~DemandTec stockholders held in ~~other~~Redwood ~~actions~~City, inCalifornia ~~response~~(the to“Special ~~the~~Meeting”), ~~announcement~~DemandTec’s ofstockholders ~~the~~voted ~~execution~~to ofadopt anthe Merger Agreement. ~~and~~On ~~Plan~~February 14, ~~of Merger~~2012, ~~dated~~following asthe ofSpecial ~~December~~Meeting 7,and ~~2011~~in (accordance with the “Merger Agreement~~”),~~ by and ~~between~~the ~~DemandTec~~Delaware General Corporation Law, ~~International~~Sub ~~Business~~merged ~~Machines~~with ~~Corporation~~and into DemandTec (the “~~IBM~~Merger”), ~~and~~with ~~Cudgee~~DemandTec ~~Acquisition~~continuing ~~Corp.,~~as athe ~~wholly-owned~~surviving ~~subsidiary~~corporation ofafter ~~IBM. Pursuant to~~ the Merger ~~Agreement,~~and ~~DemandTec~~becoming ~~will become~~ a wholly owned subsidiary of IBM ~~(the “Merger”)~~.

AsUnder ~~described~~the interms ~~further~~of ~~detail in~~ the ~~definitive~~Merger ~~proxy~~Agreement, ~~statement~~at ~~dated~~the ~~January 12,~~effective ~~2012~~time (of the ~~“Proxy Statement”)~~Merger, aeach ~~purported~~share ~~stockholder~~of common stock of DemandTec, ~~filed~~$0.001 apar ~~class~~value ~~action~~per ~~lawsuit~~share in(“DemandTec’s ~~the~~Common ~~Court~~Stock”), ~~captioned~~issued ~~Strategic~~and ~~Trading~~outstanding ~~Company~~immediately ~~v. Daniel~~prior R.to ~~Fishback,~~the eteffective ~~al.,~~time ~~Case~~of ~~No. 112CV216048~~the ~~(Cal.~~Merger ~~Sup.~~was ~~Ct.)~~converted (into the ~~“Lawsuit”). The~~right ~~Lawsuit~~to ~~names~~receive ~~DemandTec,~~$13.20 ~~its~~in ~~directors~~cash, ~~IBM~~ without interest and ~~Cudgee~~less ~~Acquisition~~any ~~Corp.~~applicable aswithholding ~~defendants~~taxes (the “Merger Consideration”).

Under the ~~terms of the MOU, DemandTec, the other defendants and the plaintiff have agreed to settle the Lawsuit and release the defendants from all claims relating to the~~ Merger, ~~subject to approval by the Court. If the Court approves the settlement contemplated by the MOU~~Agreement, ~~the~~equity ~~Lawsuit~~awards ~~will~~exercisable beor ~~dismissed~~convertible ~~with~~into ~~prejudice. Pursuant~~shares ~~to the terms~~ of ~~the MOU,~~ DemandTec’s ~~has~~common ~~agreed~~stock towere ~~make~~either ~~available~~canceled ~~additional information to its stockholders. The additional information is contained below~~ and ~~should~~converted beinto ~~read~~a inright conjunction with the Proxy Statement, which should be read in its entirety. Defined terms used but not defined herein have the meanings set forth in the Proxy Statement. In return, the plaintiff has agreed to ~~dismissal~~receive ofa ~~the~~cash ~~Lawsuit~~payment ~~with prejudice and to withdraw all motions filed in connection with the Lawsuit. If the MOU is finally approved by the Court~~or, ~~it is anticipated that the MOU will resolve and release all claims~~ in ~~all~~some ~~actions that were or could have been brought challenging any aspect of the Merger~~cases, ~~the~~converted ~~Merger~~into ~~Agreement~~comparable ~~and~~awards ~~any~~for ~~disclosures~~common ~~made~~stock ~~in connection therewith. There can be no assurance that the parties will ultimately enter into a stipulation~~ of ~~settlement or that the Court will approve the settlement~~IBM, ~~even if the parties were to enter into such stipulation. In such event, the proposed settlement~~ as ~~contemplated~~described byin ~~the~~more ~~MOU~~detail ~~may be terminated~~below.

~~The~~Stock ~~settlement~~options ~~will not affect the consideration~~ to beacquire ~~paid to~~ DemandTec’s ~~stockholders~~common instock ~~connection~~outstanding ~~with~~and ~~the~~unexercised ~~Merger~~at or the ~~timing~~effective time of the ~~special~~Merger ~~meeting~~were oftreated ~~DemandTec’s stockholders, which is scheduled for February 14, 2012~~ in ~~Redwood~~one ~~City,~~of ~~California, to consider and vote upon a proposal to approve~~ the ~~Merger~~following ~~Agreement, among other things.~~manners:

~~DemandTec~~· Each ~~and~~option ~~the~~that ~~other~~was ~~defendants~~(i) vested ~~have~~(or ~~vigorously~~vested ~~denied,~~in ~~and~~connection ~~continue to vigorously deny, any wrongdoing or liability~~ with ~~respect to~~ the ~~facts and claims asserted~~Merger), or(ii) held ~~which~~by ~~could~~a ~~have~~non-employee ~~been asserted~~director, inconsultant ~~the~~or ~~Lawsuit,~~independent ~~including~~contractor ~~that they have committed any violations~~ of ~~law~~DemandTec or ~~breach~~any of ~~fiduciary~~its ~~duty,~~subsidiaries ~~that~~(other ~~they~~than ~~have~~the ~~acted~~options ~~improperly~~described inbelow) ~~any way,~~ or ~~that~~(iii) had ~~they~~an ~~have~~exercise ~~any~~price ~~liability~~per orshare ~~owe~~greater ~~any~~than ~~damages~~or ofequal ~~any kind~~ to ~~plaintiff or to~~ the ~~purported~~Merger ~~class~~Consideration, ~~and~~was ~~specifically~~canceled ~~deny~~at ~~that any further supplemental disclosure is required under any applicable rule, statute, regulation or law or that~~ the ~~DemandTec~~effective ~~directors~~time ~~failed~~of ~~to maximize stockholder value by entering into~~ the ~~merger~~Merger, ~~agreement with IBM~~ and ~~Cudgee~~the ~~Acquisition~~holder ~~Corp.~~thereof ~~The~~was ~~settlement~~entitled ~~contemplated~~to byreceive ~~the agreement~~ in ~~principle~~consideration isfor ~~not,~~such ~~and~~cancelation ~~should~~a ~~not~~cash bepayment ~~construed~~equal ~~as, an admission of wrongdoing or liability by any defendant. However,~~ to ~~avoid~~ the ~~risk~~product of ~~delaying~~ the ~~Merger,~~number ~~and~~of toshares ~~provide~~subject ~~additional information~~ to ~~DemandTec’s~~such ~~stockholders~~option ~~at a time~~ and inthe aexcess, ~~manner~~if ~~that would not cause~~ any, ~~delay~~ of the Merger, ~~DemandTec~~Consideration ~~and~~over ~~its directors agreed to~~ the ~~settlement~~exercise ~~described~~price ~~above.~~per ~~The~~share ~~parties~~of ~~considered it desirable that~~ the ~~action be settled to avoid the substantial burden~~option, ~~expense,~~less ~~risk,~~applicable ~~inconvenience~~tax ~~and distraction of continued litigation and to fully and finally resolve the matter~~withholdings.

· Each unvested option held by certain consultants or independent contractors of DemandTec ~~makes~~or any of its subsidiaries was canceled at the effective time of the Merger, and the holder thereof was entitled to receive in consideration for such cancelation a cash payment from IBM payable following ~~supplemental~~each ~~disclosures:~~applicable date after the Merger on which any such option would have vested equal to the product of the number of shares of DemandTec’s common stock that were subject to such option and that would have vested on the applicable vesting date and the excess of the Merger Consideration over the exercise price per share of the option, so long as such holder continues to provide services to IBM or its subsidiaries through the applicable vesting date.

In· Any ~~addition~~option tonot ~~the~~described ~~disclosure~~above onwas ~~pages iv-v,~~converted ~~6-9,~~into ~~25,~~an ~~40-48,~~option ~~53-55~~to acquire, ~~59-61~~on substantially the same terms and ~~80-82~~conditions ofas ~~the~~were ~~proxy~~applicable ~~statement~~to ~~regarding~~such option prior to the ~~impact~~Merger, shares of ~~the~~common ~~acquisition~~stock onof ~~compensation~~IBM. ~~arrangements~~The ~~for~~number ~~certain~~of ~~members~~shares of ~~our~~common ~~management,~~stock weof ~~note~~IBM ~~that~~underlying ~~Mr. Fishback~~such option was determined by multiplying the number of shares of DemandTec’s ~~offer~~common ~~letter~~stock ~~with~~underlying ~~IBM~~such ~~does~~option ~~not provide~~by ~~that~~an heexchange ~~will~~ratio, ~~receive~~which ~~any~~was ~~additional~~determined ~~equity~~by ~~grants~~dividing oran ~~awards~~amount ~~from~~equal usto orthe ~~IBM~~Merger ~~(other~~Consideration ~~than~~by ~~with~~the ~~respect~~average toclosing ~~outstanding~~price ~~DemandTec~~of ~~restricted~~a share of IBM’s common stock ~~units~~on ~~that~~the ~~will~~20 betrading ~~converted~~days ~~into~~immediately ~~restricted~~prior ~~stock~~to ~~units~~the ~~representing~~closing of the ~~right~~Merger, rounded down to ~~receive~~the ~~shares~~nearest whole share of IBM’s common stock,. asThe ~~described~~exercise ~~below). In~~price ~~addition,~~per ~~Mr. Fishback’s~~share ~~offer~~of ~~letter~~such ~~with~~option ~~IBM~~was ~~includes~~determined anby ~~explicit~~dividing ~~waiver~~the ~~and~~exercise ~~release~~price of ~~any~~such ~~rights~~option heprior ~~may have~~ to ~~receive~~the ~~equity-based~~Merger ~~awards~~by in the ~~future. We~~exchange ~~also~~ratio ~~note~~described ~~that~~above, asrounded ~~previously~~up ~~disclosed~~to in the ~~definitive~~nearest whole cent.

~~proxy~~Restricted ~~statement~~stock inunits ~~tabular~~that ~~form,~~were ~~the~~outstanding ~~merger agreement~~ and ~~Mr. Fishback’s~~unsettled ~~offer~~at ~~letter~~the ~~provide~~effective ~~for~~time of the ~~following~~Merger ~~treatment~~were oftreated ~~his~~in ~~outstanding~~one ~~stock~~of ~~options~~the ~~and~~following ~~stock units~~manners:

· all of his outstanding and unexercised options to acquire our common stock, totaling 1,070,000 stock options as of December 31, 2011, each of which is fully vested, will be cancelled at the closing in exchange for a cash payment of $11,604,000, with the method of calculation being more fully described in the proxy statement;2

· ~~all~~Each ofrestricted ~~his~~stock unit that was (i) vested ~~but~~(or ~~unsettled~~vested ~~restricted~~in ~~stock~~connection ~~units,~~with ~~totaling~~the 54Merger) or (ii) held by a non-employee director,~~450~~ ~~such~~consultant or independent contractor of DemandTec or any of its subsidiaries (other than the restricted stock units asdescribed below) were canceled at the effective time of ~~December 31,~~the ~~2011~~Merger, ~~will~~and bethe ~~cancelled~~holder atthereof ~~the~~was ~~closing~~entitled to receive in ~~exchange~~consideration for such cancelation a cash payment ofequal ~~$718,740,~~to ~~with~~the product of the ~~method~~number of ~~calculation~~shares ~~being~~subject ~~more~~to ~~fully~~such ~~described~~restricted instock unit and the ~~proxy~~Merger ~~statement;~~Consideration, less applicable tax withholdings.

· ~~all~~Each ~~of his~~ unvested restricted stock ~~units~~unit ~~subject~~held toby ~~service-based~~certain ~~vesting~~consultants ~~conditions,~~or ~~totaling~~independent ~~62,500~~contractors ~~such~~of ~~restricted~~DemandTec ~~stock~~or ~~units~~any as of ~~December 31,~~its ~~2011,~~subsidiaries ~~will~~was becanceled ~~converted~~at ~~into~~the ~~restricted~~effective ~~stock~~time ~~units~~of ~~representing~~the Merger, and the ~~right~~holder thereof was entitled to receive ~~shares~~in ofconsideration ~~IBM~~for ~~common~~such ~~stock~~cancelation ata ancash ~~exchange~~payment ~~ratio,~~from ~~the~~IBM ~~numerator~~payable offollowing ~~which~~each isapplicable date after the ~~merger~~Merger ~~consideration~~on ofwhich ~~$13.20~~any ~~per~~such ~~share~~restricted ~~and~~stock ~~the~~unit ~~denominator~~would ofhave ~~which~~vested, isequal to the ~~average~~product ~~closing~~of ~~price~~the ~~per~~number ~~share~~of shares of ~~IBM~~DemandTec’s common stock onthat ~~the~~were ~~New~~subject ~~York~~to ~~Stock~~such ~~Exchange~~award ~~Composite~~and ~~Transactions~~that ~~Tape~~would have vested on the 20applicable ~~trading~~vesting ~~days~~date ~~immediately~~and ~~prior to~~ the ~~closing~~Merger ~~date~~Consideration, ofso ~~the~~long ~~merger~~as ~~and~~such ~~will~~holder ~~continue~~continues to beprovide ~~subject~~services to ~~service-based~~IBM ~~vesting~~or ~~conditions,~~its assubsidiaries ~~more~~through ~~fully described in~~ the ~~proxy~~applicable ~~statement;~~vesting date.

· ~~all~~Any ~~of his unvested~~ restricted stock ~~units~~unit ~~that~~not ~~are~~described ~~subject~~above towas ~~both~~converted ~~performance-based~~into ~~and~~a ~~service-based~~restricted ~~vesting~~stock ~~conditions~~unit, ~~totaling~~on ~~136,250~~substantially ~~such~~the ~~restricted~~same ~~stock~~terms ~~units~~and conditions as ofwere ~~December 31,~~applicable ~~2011 (assuming, with respect~~ to ~~certain~~such restricted stock ~~units~~unit ~~that,~~prior byto ~~their~~the ~~terms~~Merger, ~~may~~with ~~vest~~respect up to ashares ~~maximum~~of ~~level~~common stock of ~~150%~~IBM. The number of ~~target~~shares ~~performance,~~of ~~maximum~~common ~~performance),~~stock ~~will~~of beIBM ~~converted~~underlying ~~into~~such restricted stock ~~units~~unit ~~representing~~was ~~the~~determined ~~right~~by tomultiplying ~~receive~~the number of shares of ~~IBM~~DemandTec’s common stock atunderlying ansuch ~~exchange~~restricted ~~ratio,~~stock ~~the~~unit ~~numerator~~by ~~of which is~~ the ~~merger~~exchange ~~consideration~~ratio ofdescribed ~~$13.20~~above, ~~per~~rounded ~~share~~down ~~and~~to the ~~denominator~~nearest ofwhole ~~which is the average closing price per~~ share of IBM’s common stock onand, ~~the~~with ~~New~~respect ~~York~~to ~~Stock~~each ~~Exchange~~performance-based ~~Composite~~restricted ~~Transactions~~stock ~~Tape~~unit onfor which the 20performance ~~trading~~period ~~days~~is ~~immediately~~scheduled ~~prior~~ to end after the ~~closing~~effective ~~date~~time of the ~~merger~~Merger, inconverted ~~which~~into ~~the~~an ~~performance-based~~IBM ~~vesting~~restricted ~~criteria~~stock ~~will~~unit beon ~~deemed~~the ~~satisfied~~assumption atthat ~~100%~~the ~~of target~~ performance ~~and~~criteria ~~will~~applicable ~~continue~~ to besuch ~~subject~~restricted tostock ~~service-based~~unit ~~vesting,~~were asachieved ~~more~~at ~~fully~~100% ~~described~~of intarget ~~the~~performance ~~proxy~~and ~~statement. As~~each such, ~~Mr. Fishback~~performance-based ~~will forfeit up to 18,750~~ restricted stock ~~units~~unit ~~that~~will ~~may~~vest, ~~have~~following ~~otherwise~~the ~~vested~~effective iftime ~~those~~of ~~restricted~~the ~~stock units that~~Merger, bybased ~~their~~solely ~~terms,~~on ~~were~~the ~~eligible~~basis ~~for vesting at 150%~~ of ~~target performance had vested assuming performance at~~ the ~~maximum~~service-based ~~level,~~vesting asconditions ~~more~~applicable ~~fully~~to ~~described~~such inrestricted ~~the~~stock ~~proxy statement; and~~units.

~~· all~~The of2007 ~~his~~Employee ~~restricted~~Stock ~~stock~~Purchase ~~units~~Plan ~~representing~~(the “ESPP”) remained in effect on the last trading day before the closing of the Merger, and each purchase right tooutstanding ~~receive~~under the ESPP was exercised and shares of ~~IBM~~DemandTec’s common stock ~~resulting~~were ~~from~~purchased in accordance with the ~~conversion~~terms of ~~DemandTec~~the ~~restricted~~ESPP ~~stock~~at ~~units~~a ~~described~~purchase ~~above,~~price ~~will~~per beshare ~~subject~~equal to ~~acceleration~~85% ~~upon~~of the ~~earlier~~lesser of (i) the ~~twelve-month~~closing ~~anniversary~~price of a share of DemandTec’s common stock on the ~~closing~~NASDAQ ~~or,~~Global ifMarket ~~earlier,~~on ~~upon~~the ~~certain~~last ~~qualifying~~trading ~~terminations~~day before the commencement of ~~Mr.~~the last offering period and (ii) ~~Fishback~~the closing price of a share of DemandTec’s ~~employment~~common stock on the NASDAQ Global Market on the last trading day before the closing of the Merger, assubject ~~more~~to ~~fully~~the ~~described~~limitations inunder the ~~proxy~~ESPP ~~statement~~regarding the maximum number and value of shares of DemandTec’s common stock purchasable with respect to any offering period.

InIBM ~~addition~~has tobeen ~~the~~a ~~information~~strategic ~~disclosed~~partner ~~on page 19~~ of ~~the~~DemandTec ~~proxy~~for ~~statement~~several inyears, ~~the~~collaborating ~~first~~jointly ~~paragraph under “Background to the Merger” relating to our commercial relationship~~ with ~~IBM,~~DemandTec ~~we estimate that our revenues in fiscal years 2009~~ to ~~2011~~sell and ~~the~~implement ~~first nine months of fiscal year 2012 from customers for which~~ IBM ~~has~~ ~~served~~and asDemandTec asolutions ~~reseller~~in ~~represented~~multiple 2geographies.~~2%,~~ ~~1.3%,~~DemandTec ~~1.7%~~has ~~and 2.3% of our total revenues, respectively. We~~ also ~~purchase~~purchased certain hardware and software from IBM and IBM ~~provides~~has provided consulting services to certain of ~~our~~DemandTec’s customers around the world.

InThe ~~addition~~foregoing todescription ~~the information disclosed on page 19~~ of the ~~proxy~~Merger ~~statement~~Agreement ~~regarding~~and the ~~August 10,~~transactions ~~2011~~contemplated ~~meeting~~thereby ofdoes ~~between~~not ~~Messrs. Culhane~~purport ~~and~~to ~~Johnson~~be ofcomplete ~~DemandTec~~ and ~~representatives~~is ofsubject ~~USA~~to, weand ~~note~~qualified ~~that~~in atits ~~the~~entirety ~~meeting representatives of USA provided a perspective on how potential strategic partners view our sector~~by, ~~factors~~reference ~~they~~to ~~consider~~the inMerger ~~valuing~~Agreement. ~~technology~~A ~~companies~~copy ~~similar~~of tothe usMerger ~~and~~Agreement ~~how~~was ~~they~~attached ~~approach~~as ~~strategic transactions~~Exhibit 2. ~~Representatives~~1 ofto ~~USA~~DemandTec’s ~~also~~Current ~~told~~Report uson ~~that~~Form 8-K ~~IBM~~filed ~~was~~with ~~interested~~the inSecurities anand ~~introduction~~Exchange toCommission ~~DemandTec~~(the to“SEC”) ~~discuss~~on ~~their~~December 8, ~~potential~~2011 ~~interest in acquiring us~~ and ~~for~~is usincorporated toherein ~~assess~~by ~~their potential interest~~reference.

In addition to the information disclosed on page 20 of the proxy statement regarding the September 12, 2011 phone call between Mr. Culhane of DemandTec and Mr. Colburn of IBM, we note that they discussed on a3

2Item 3.01. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

~~preliminary~~In ~~basis~~connection ~~their~~with ~~respective~~the ~~approaches~~completion toof ~~valuing~~the usMerger, on February 14, 2012, DemandTec notified the NASDAQ Global Market (the “NASDAQ”) of the consummation of the Merger and requested that ~~the~~trading ~~next~~in ~~step~~DemandTec’s ~~would~~Common Stock be ~~for~~suspended ~~IBM~~and tothat ~~deliver~~DemandTec’s Common Stock be withdrawn from listing on the NASDAQ as of the close of market on February 14, 2012. The NASDAQ filed with the SEC a ~~formal~~Notification ~~written~~of ~~indication~~Removal from Listing and/or Registration under Section 12(b) of ~~interest~~the ~~setting~~Securities ~~forth~~Exchange Act of 1934, as amended (the ~~price~~“Exchange ~~per~~Act”), ~~share~~on ~~which~~Form 25 ~~IBM~~to ~~would~~delist and deregister DemandTec’s Common Stock. As a result, DemandTec’s Common Stock will no longer be ~~willing~~listed or trade on the NASDAQ. DemandTec intends to ~~pay~~file a Form 15 with the SEC to ~~acquire~~suspend ~~all~~the ofreporting ~~our~~obligations ~~outstanding~~of ~~stock~~DemandTec ~~for~~under ~~our~~Section 15(d) of ~~Board~~the toExchange ~~consider~~Act.

InItem addition to the information disclosed on pages 20 and 21 of the proxy statement regarding the September 16, 2011 Board meeting, we note that our Board considered forming, but determined not to form, a special committee of the Board to consider a possible sale of our company to IBM and other potential buyers3. ~~Our Board recognized that Mr~~03. ~~Fishback~~ ~~might~~Material ~~have~~Modification ~~a potential conflict of interest given his possible receipt of an employment offer from IBM or any other potential buyer, but determined that it was beneficial~~ to ~~have~~Rights ~~all directors, including our CEO, participate in the sale process, particularly because (i) the other six~~ of ~~our~~Security seven directors did not have an interest in a sale to IBM, other than as holders of our common stock or options to buy our common stock, (ii) there was no reason to anticipate that any employment offer MrHolders. Fishback might receive from IBM would be more attractive than his existing employment terms or those offered by another potential buyer, and (iii) Mr. Fishback has a significant equity interest in our company and thus had interests aligned with holders of our common stock.

InOn ~~addition~~February 14, ~~after~~2012, ~~considering~~as a ~~number~~result of ~~potential buyers, our Board determined at~~ the ~~meeting to direct our management to contact three other potential buyers after considering~~Merger, ~~among~~each ~~other factors, (i) IBM’s $11.25 per~~ share ~~indication~~ of interest, (ii) the ability and potential and likelihood that other potential buyers would offer a price higher than $11.25 per share, (iii) whether the potential buyer had a competing business, (iv) the potential harm to our company if the possible sale of the company became publicly known and (v) the risk of jeopardizing IBMDemandTec’s ~~offer~~Common byStock ~~widely~~issued ~~soliciting other potential buyers. Our Board (including our CEO) did not consider it relevant whether any of these potential buyers were more or less likely to offer employment to our executives~~ and~~/or~~ ~~employees~~outstanding inimmediately ~~making~~prior ~~their decision as~~ to ~~which potential buyers to contact. The Board also balanced~~ the ~~potential~~effective ~~benefit~~time ~~to stockholders~~ of ~~obtaining a higher price by contacting more potential buyers with~~ the ~~potential~~Merger ~~harm~~was toconverted ~~stockholders~~into if the ~~possible~~right ~~sale of our company became publicly known or IBM decided~~ to ~~withdraw~~receive ~~its~~$13.20 ~~indication~~in ofcash, without interest asand aless ~~result~~any ofapplicable awithholding ~~broad solicitation of other potential buyers~~tax.

WeItem ~~note~~5.01. ~~that~~Changes ~~at a deposition relating to the Lawsuit, our CEO expressed the view that two of the three potential buyers we contacted did not operate~~ in ~~our~~Control ~~space and that three~~ of ~~the potential buyers not contacted operated in our space to varying degrees~~Registrant. ~~The term “space” was not defined in the deposition.~~

InThe ~~addition to the~~ information disclosed ~~on page 25 of the proxy statement regarding the delivery by IBM of proposed offer letters to certain members of our management, including Mr. Fishback, we note IBM indicated~~ in ~~its initial indication of interest on September~~Item ~~14, 2011 that it envisioned members of DemandTec’s management becoming part of its Smarter Commerce Initiatives~~2. ~~IBM~~01 ~~and~~is ~~Mr. Fishback,~~hereby ~~however,~~incorporated ~~did not have any substantive conversations regarding his possible employment~~ by ~~IBM until after IBM and DemandTec entered into the exclusivity agreement on September 23, 2011~~reference. ~~Detailed discussions regarding his potential employment by IBM occurred between him and representatives of IBM in the mid-November timeframe before offer letters were delivered by IBM.~~

InItem addition to the information disclosed on pages 36 through 38 of the proxy statement relating to the use by USA of independent research reports referred to as street equity research cases 1 and 2 in its discounted future trading and cash flow analyses, we note that the research reports were prepared by analysts at nationally recognized financial services firms and are available on a subscription basis9. ~~USA determined to use street equity research case 1 and added street equity research report 2 at the request of management~~01. ~~Both~~ ~~research~~Financial ~~reports~~Statements were issued during the third quarter of our fiscal year 2012 subsequent to the announcement of our financial results for the second quarter of fiscal year 2012. The forecasts of both street equity research cases were lower than the internal forecast prepared by our management. USA believed it was useful to consider third party forecasts of our financial results when evaluating the fairness of the merger consideration from a financial point of view to indicate how implied valuations of our common stock might vary under different forecast scenarios. USA chose these two equity research reports because they were recent and ~~constituted the only equity research reports that projected the Company’s financial results for periods beyond fiscal 2013~~Exhibits. We have been advised by USA that they used the research report referred to as street equity research case 2 in their discounted cash flow analysis because it is the higher of the two independent street cases and therefore would reflect implied values higher than street equity research case 1.

3(d) See the Exhibit Index attached to this Current Report on Form 8-K, which is incorporated herein by reference.

In performing its discounted cash flow analysis, USA extrapolated our forecast of revenue and free cash flow through 2015, as summarized on page 39 of the proxy statement, for 2016 through 2018 for revenue and 2016 and 2017 for free cash flow. It did not extrapolate adjusted gross profit, adjusted net income or adjusted earnings per share. The extrapolated financial results are as follows (in millions):4

	Fiscal Year Ending February 28 or 29,
	2016		2017		2018
Revenue	$	188.2	$	225.9	$	271.0
Free Cash Flow	$	32.9	$	39.4	NA

SIGNATURE

InPursuant ~~addition~~ to the ~~information~~requirements ~~disclosed on pages 39-40~~ of the ~~proxy~~Securities ~~statement,~~Exchange weAct ~~note~~of ~~that~~1934, the ~~company’s~~Registrant ~~internal~~has ~~financial~~duly ~~forecasts~~caused ~~took~~this ~~into~~report ~~account~~to ~~the~~be ~~anticipated~~signed ~~financial~~on ~~results~~its ~~associated~~behalf ~~with~~by the ~~company’s~~undersigned ~~acquisitions~~hereunto ofduly ~~Applied Intelligence Solutions, LLC and M-Factor, Inc~~authorized.~~, in December 2010 and March 2011, respectively.~~

Cautionary Statement Regarding Forward-Looking Statements

	DEMANDTEC, INC.

Date: February 14, 2012	By:	/s/ Michael J. McAdam
		Michael J. McAdam
		General Counsel and Secretary

Certain statements in this communication regarding the proposed transaction between IBM and DemandTec, the expected timetable for completing the transaction, benefits and synergies of the transaction, future opportunities for the combined company and products and any other statements regarding IBM and DemandTec’s future expectations, beliefs, goals, plans or prospects constitute forward-looking statements made within the meaning of Section 21E of the Securities Exchange Act of 1934 and (collectively, forward-looking statements). Any statements that are not statements of historical fact (including statements containing the words “believes,” “plans,” “anticipates,” “expects,” “estimates” and similar expressions) should also be considered forward-looking statements. A number of important factors could cause actual results or events to differ materially from those indicated by such forward-looking statements, including the parties’ ability to consummate the transaction; the conditions to the completion of the transaction, including the receipt of stockholder approval, court approval or the regulatory approvals required for the transaction may not be obtained on the terms expected or on the anticipated schedule; the parties’ ability to meet expectations regarding the timing, completion and accounting and tax treatments of the transaction; the possibility that the parties may be unable to achieve expected synergies and operating efficiencies in the arrangement within the expected time-frames or at all and to successfully integrate DemandTec’s operations into those of IBM; such integration may be more difficult, time-consuming or costly than expected; operating costs, customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers, clients or suppliers) may be greater than expected following the transaction; the retention of certain key employees of DemandTec may be difficult; IBM and DemandTec are subject to intense competition and increased competition is expected in the future; fluctuations in foreign currencies could result in transaction losses and increased expenses; the volatility of the international marketplace; and the other factors described in IBM’s Annual Report on Form 10-K for the fiscal year ended December 31, 2010 and in its most recent quarterly report filed with the SEC, and DemandTec’s Annual Report on Form 10-K for the fiscal year ended February 28, 2011 and in its most recent quarterly report filed with the SEC. IBM and DemandTec assume no obligation to update the information in this communication, except as otherwise required by law. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.5

~~Additional Information and Where to Find It~~EXHIBIT INDEX

This communication may be deemed to be solicitation material in respect of the proposed acquisition of DemandTec by IBM. In connection with the proposed acquisition, DemandTec has filed a proxy statement in preliminary and definitive form with the SEC. STOCKHOLDERS OF DEMANDTEC ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING DEMANDTEC’S DEFINITIVE PROXY STATEMENT, BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and security holders may obtain the documents free of charge at the SEC’s website, http://www.sec.gov. Documents are also available for free from DemandTec by contacting DemandTec Investor Relations at (650) 645-7103 or tim.shanahan@demandtec.com.

Exhibit No.		Description
2.1		Agreement and Plan of Merger, dated December 7, 2011, by and among International Business Machines Corporation (“IBM”), Cudgee Acquisition Corp., a wholly owned subsidiary of IBM, and DemandTec, Inc., filed as Exhibit 2.1 to the registrant’s Current Report on Form 8-K filed with the SEC on December 8, 2011 and incorporated herein by reference.

Participants in Solicitation

IBM and its directors and executive officers, and DemandTec and its directors and executive officers, may be deemed to be participants in the solicitation of proxies from the holders of DemandTec common shares in respect of the proposed transaction. Information about the directors and executive officers of IBM is set forth in the proxy statement for IBM’s 2011 Annual Meeting of Stockholders, which was filed with the SEC on March 7, 2011. Information about the directors and executive officers of DemandTec is set forth in the proxy statement for DemandTec’s 2011 Annual Meeting of Stockholders, which was filed with the SEC on June 24, 2011. Investors may obtain additional information regarding the interest of such participants by reading the definitive proxy statement regarding the acquisition filed with the SEC on January 12, 2012.

SIGNATURE

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 hereunto duly authorized.

	DEMANDTEC, INC.
Date: February 8, 2012	By:	/s/ Michael J. McAdam
		Michael J. McAdam
		General Counsel and Secretary

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