SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of earliest event reported: December 29, 1999
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Internet Capital Group, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 0-26929 23-2996071
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State of Incorporation (Commission File Number) (IRS Employer Identification No.)
435 Devon Park Drive, Building 800, Wayne, PA 19087
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(Address of principal executive offices) (Zip Code)
(610) 989-0111
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(Registrant's telephone number)
Item 2. Acquisition of Assets.
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On December 29, 1999, Internet Capital Group, Inc. (the "Company")
acquired an interest in MetalSite, L.P., a Delaware limited partnership
("MetalSite"), and an interest in MetalSite General Partner, LLC, a Delaware
limited liability company and the general partner of MetalSite (the "General
Partner"), pursuant to a Securities Purchase Agreement (the "Purchase
Agreement") between the Company and Weirton Steel Corporation, a Delaware
corporation ("Weirton"). The aggregate purchase price for these purchased
interests was $30,000,000 in cash and 852,631 shares of common stock of the
Company. The source of funds for the cash portion of the purchase price was the
Company's internal cash reserves.
MetalSite operates a Web site which acts as a venue for users to
exchange news and information, to purchase products and services, to participate
in auctions and to establish an electronic marketplace for the metals industry.
The General Partner operates as the general partner of MetalSite.
Pursuant to the Purchase Agreement, the Company acquired a Class A
limited partner interest in MetalSite representing a 44.42% interest on a
primary basis and a 35.35% interest on a fully-diluted basis. The Company also
acquired a Membership Interest in the General Partner representing a 47.26%
interest on a primary basis and a 39.72% interest on a fully-diluted basis. The
General Partner owns a 1% interest in MetalSite.
In addition, pursuant to the Purchase Agreement, the Company has been
granted options to purchase additional interests in MetalSite and the General
Partner upon the occurrence of certain events. In the event of a "change of
control" of Weirton (as defined in the Purchase Agreement) prior to completion
of an underwritten public offering of equity securities by MetalSite on the
terms described in the Purchase Agreement (a "MetalSite Public Offering"), the
Company will have the option to purchase any or all of Weirton's remaining
interest in MetalSite and a corresponding portion of Weirton's remaining
interest in the General Partner at a mutually agreed fair market value price or,
in the absence of agreement, an independently appraised fair market value price.
For a 30 day period commencing upon expiration of an interim period following a
MetalSite Public Offering, the Company will have the option to purchase an
additional 10% interest in MetalSite (determined on a pre-offering basis) at an
average market price based upon the trading prices of MetalSite's equity
securities during the ten-day period prior to notice of exercise of such option.
In the event of a "change of control" of Weirton after completion of a MetalSite
Public Offering, the Company will, if it has exercised its option to purchase
additional MetalSite securities described in the previous sentence (or if such
option has not yet become exercisable), have the option to purchase any or all
of Weirton's remaining interest in MetalSite at an average market price based
upon the trading prices of MetalSite's equity securities during the ten-day
period prior to notice of exercise of such option.
Under the terms of the Operating Agreement of the General Partner, the
Board of Directors of the General Partner consists of ten voting and one non-
voting members. The non-voting member is the Chief Executive Officer of
MetalSite. Initially, the Company will have the right to appoint two voting
members of the Board of Directors of the General Partner, Weirton will have the
right to appoint two voting members, and Weirton and the Company will jointly
appoint two voting directors. The remaining four voting directors will be
appointed by the other
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limited partners of MetalSite. The Operating Agreement of the General Partner
provides that action by the Board of Directors in general requires the
affirmative vote of a number of directors equal to (i) the number of directors
appointed by Weirton and the Company that are present at the meeting and not
abstaining from such vote and (ii) two additional voting directors.
In the event the Company acquires 50% or more of Weirton's remaining
Membership Interest in the General Partner or in the event the Company's
percentage interest in the General Partner otherwise exceeds 49.72% on a fully-
diluted basis, the Company will thereafter have the right to appoint four voting
directors, Weirton will have the right to appoint one voting director, one
voting director will be mutually appointed by Weirton and the Company, and the
remaining four voting directors will be appointed by the other limited partners
of MetalSite.
Each of the Limited Partnership Agreement of MetalSite and the
Operating Agreement of the General Partner contains provisions restricting
transfer of interests of MetalSite and the General Partner, respectively, rights
of first refusal and other provisions governing the relationship of the partners
of MetalSite and the members of the General Partner.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
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(a) Financial Statements of Business Acquired
Financial Statements required by this item are omitted in accordance
with the provisions of paragraph (a)(4) of this item and will be filed by
amendment as soon as practicable but not later than 60 days after the date that
this report must be filed.
(b) Pro Forma Financial Information
Financial Statements required by this item are omitted in accordance
with the provisions of paragraph (a)(4) of this item and will be filed by
amendment as soon as practicable but not later than 60 days after the date that
this report must be filed.
(c) Exhibits
2.1 - Securities Purchase Agreement dated as of December 28, 1999 between
Weirton Steel Corporation and Internet Capital Group, Inc. This
exhibit contains a list of schedules to the exhibit, all of which have
been omitted. Upon request of the Securities and Exchange Commission,
the Company will furnish a copy to it supplementally.
99.1 - Press release issued by the Company on December 29, 1999.
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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, thereunto duly authorized.
INTERNET CAPITAL GROUP, INC.
Dated: January 11, 2000 By: /s/ David D. Gathman
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David D. Gathman
Chief Financial Officer
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EXHIBIT INDEX
Exhibit No. Description
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2.1 Securities Purchase Agreement dated as of
December 28, 1999 between Weirton Steel
Corporation and Internet Capital Group, Inc.
This exhibit contains a list of schedules to
the exhibit, all of which have been omitted.
Upon request of the Securities and Exchange
Commission, the Company will furnish a copy to
it supplementally.
99.1 Press release issued by the Company on December
29, 1999.
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