UNITED STATES
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
November 1, 2002
(Date of Report)
Network Commerce Inc.
(Exact Name of Registrant as Specified in its Charter)
Washington 0-26707 91-1628103
(State or Other Jurisdiction (Commission File No.) (IRS Employer
of Incorporation Identification Number)
411 First Avenue South
Suite 200 N
Seattle, WA 98104
(Address of Principal Executive Offices, including zip)
(206) 223-1996
(Registrant's Telephone Number, including area code)
Item 3. Bankruptcy or Receivership
On November 1, 2002, Network Commerce Inc. a Washington corporation
("Network Commerce"), filed a petition for relief under Chapter 11 of the United
States Bankruptcy Code ("Chapter 11") in the United States Bankruptcy Court for
the Western District of Washington.
Network Commerce will ask the Bankruptcy Court to allow it to oversee its
operations as a debtor-in-possession, subject to Court approval of matters
outside the ordinary course of business. No trustee, receiver or examiner has
been appointed, and Network Commerce will act as a debtor-in-possession while
being subject to the supervision and orders of the Bankruptcy Court.
While in Chapter 11, Network Commerce intends to continue to operate NCI
Hosting, which provides domain registration, hosting and other online business
services. Additionally, Network Commerce will evaluate several alternatives,
including, without limitation, management-directed sales of one or more of
Network Commerce's operating divisions as going concerns, the sale of portions
of the business in separate transactions, and the liquidation of the remainder
of assets not used in the operation of NCI Hosting. Regardless of any action
taken while in Chapter 11, Network Commerce believes that the total proceeds of
any or all sales or liquidation of its business and assets will not be
sufficient to satisfy fully the claims of its creditors. Accordingly, Network
Commerce believes that its equity has no value and that its existing
shareholders will not receive any distributions on account of their shares of
common stock under any plan that may be confirmed by the Bankruptcy Court under
Chapter 11.
Following filing of its bankruptcy petition, Network Commerce terminated 25
active employees, reducing its payroll to 14 persons. Network Commerce has
scaled back operations with the focus of protecting its remaining assets.
Item 5. Other Events and Regulation FD Disclosure
Effective as of October 31, 2002, Mark H. Terbeek resigned from the Network
Commerce Board of Directors.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Form 8-K to be signed on its behalf by the
undersigned, thereunto duly authorized.
Dated: November 5, 2002.
NETWORK COMMERCE INC.
By: /s/ N. Scott Dickson
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N. Scott Dickson
Acting Chief Executive Officer and
Chief Financial Officer
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