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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 Report (Date of Earliest Event Reported): January 31, 2000
Commission File Number
000-26225
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WIT CAPITAL GROUP, INC.
(exact name of registrant as specified in its charter)
DELAWARE 13-3900397
(State or other jurisdiction (I.R.S. Employer jurisdiction
of incorporation or organization) Industrial Identification Number)
826 BROADWAY, SEVENTH FLOOR, NEW YORK, NEW YORK 10003
(Address of principal executive offices) (Zip Code)
(212) 253-4400
(Registrant's telephone number, including area code)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On January 31, 2000 Wit Capital Group, Inc. ("Wit Capital") completed
the acquisition of SoundView Technology Group, Inc. ("SoundView") pursuant to
the terms of an Agreement and Plan of Merger (the "Merger Agreement"), dated as
of October 31, 1999, by and among Wit Capital, SoundView and W/S Merger Corp.
("Merger Sub"), a wholly owned subsidiary of Wit Capital. Merger Sub merged with
and into SoundView, with SoundView surviving the merger as a wholly owned
subsidiary of Wit Capital (the "Merger"). Wit Capital has obtained the required
stockholder approval and regulatory approval in order to complete the Merger.
The Merger Agreement is incorporated herein by reference to the Registration
Statement on Form S-4 (File No. 333-92887) of Wit Capital filed with the
Securities and Exchange Commission in connection with the Merger and an
amendment to the Merger Agreement is filed as an exhibit hereto.
In the Merger, each share of SoundView common stock was converted
into the right to receive 5.073 shares of Wit Capital common stock. The terms
of the Merger include a limited cash election feature whereby each SoundView
stockholder who so elects and complies with the election and exchange
procedures Wit Capital has established may receive $81.2387 in cash for up to
14.66% of the shares of SoundView common stock held by such holder, with each
remaining share of SoundView common stock not exchanged for cash to be
exchanged instead for 5.073 shares of Wit Capital common stock. Wit Capital
also assumed outstanding options to acquire SoundView common stock and
converted these into options to acquire Wit Capital common stock at the same
exchange ratio used in the Merger for the outstanding SoundView common stock.
No fractional shares of Wit Capital common stock will be issued in connection
with the Merger. Instead, fractional shares will be exchanged for a
proportional amount of cash. The terms of the Merger were determined through
arm's-length negotiations between Wit Capital and SoundView. The Merger is
intended to qualify as a tax-free reorganization under the Internal Revenue
Code of 1986, as amended, and is intended to be accounted for using the
purchase method of accounting.
Certain statements in this news release constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform
Act of 1995. These forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause Wit Capital's actual
results, performance or achievements, or those of the industry in which it
operates, to be materially different from any expected future results,
performance or achievements expressed or implied in these forward-looking
statements. Factors that could cause or contribute to such differences
include, but are not limited to, those economic factors that affect the
market for capital raising, including initial public offerings and those
factors discussed in the Registration Statement on Form S-4 (File No.
333-92887) relating to the Merger and periodic reports filed from time to
time with the Securities and Exchange Commission.
A copy of Wit Capital's press release announcing the effectiveness of
the Merger is incorporated herein by reference and included as Exhibit 99.1
hereto.
ITEM 5. OTHER EVENTS
On January 27, 2000, Wit Capital's stockholders held a special meeting
(the "Special Meeting"). The Board of Directors called the Special Meeting in
order to obtain stockholder approval on several proposals. The stockholders were
asked to approve, and did approve, the Merger Agreement. The stockholders were
also asked to approve, and did approve, two amendments to Wit Capital's Stock
Incentive Plan. The first amendment presented to and approved by the
stockholders increased the number of shares of Wit Capital common stock reserved
for issuance under the Stock Incentive Plan from 17,500,000 shares to 27,350,000
shares. The second amendment presented to and approved by the stockholders
limits the maximum number of options and other awards which may be granted under
the Stock Incentive Plan to an employee in any fiscal year to 1 million shares
of Wit Capital common stock.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial Information
The following are incorporated into this document by reference
to the Registration Statement on Form S-4 (File No. 333-92887) of Wit Capital
Group, Inc., filed with the Securities and Exchange Commission in connection
with the Merger:
(i) Independent Auditors Report;
(ii) SoundView Technology Group, Inc. Consolidated Statements
of Financial Condition as of September 30, 1999 (unaudited), December
31, 1998 and 1997;
(iii) SoundView Technology Group, Inc. Consolidated Statements
of Income for the nine months ended September 30, 1999 (unaudited) and
1998 (unaudited), and for the years ended December 31, 1998, 1997 and
1996;
(iv) SoundView Technology Group, Inc. Consolidated Statements
of Changes in Stockholders' Equity for the nine months ended September
30, 1999 (unaudited), and for the years ended December 31, 1998, 1997
and 1996;
(v) SoundView Technology Group, Inc. Consolidated Statements
of Cash Flows for the nine months ended September 30, 1999 (unaudited)
and 1998 (unaudited), and for the years ended December 31, 1998, 1997
and 1996; and
(vi) Notes to Consolidated Financial Statements.
(b) Pro Forma Financial Information
The following are incorporated into this document by reference
to the Registration Statement on Form S-4 (File No. 333-92887) of Wit Capital
Group, Inc., filed with the Securities and Exchange Commission in connection
with the Merger:
(i) Wit Capital Group, Inc. Pro Forma Condensed Combined
Statement of Financial Condition as of September 30, 1999 (unaudited);
(ii) Wit Capital Group, Inc. Pro Forma Condensed Combined
Statement of Opera tions for the Nine Months ended September 30, 1999
(unaudited);
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(iii) Wit Capital Group, Inc. Pro Forma Condensed Combined
Statement of Opera tions for the year ended December 31, 1998; and
(iv) Notes to Pro Forma Condensed Combined Financial
Statements.
(c) Exhibits
2.1 -- First Amendment to Merger Agreement among Wit Capital Group,
Inc., W/S Merger Corp. and SoundView Technology Group, Inc.
4.1 -- Rights Agreement between Wit Capital Group, Inc. and
American Stock Transfer & Trust Company, as Rights Agent
(Incorporated by reference to Exhibit 4.1 to the quarterly
report of Wit Capital Group, Inc. on Form 10-Q for the period
ended June 30, 1999).
99.1 -- Press release issued by Wit Capital Group, Inc. on January 31,
2000 announcing the completion of Wit Capital Group, Inc.'s
acquisition of SoundView Technology Group, Inc.
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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.
Wit Capital Group, Inc.
Dated: February 1, 2000
By: /s/ Ronald Readmond
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Ronald Readmond
President and Co-Chief Executive Officer
By: /s/ M. Bernard Siegel
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M. Bernard Siegel
Chief Financial Officer
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EXHIBIT INDEX
Exhibit
Number Exhibit
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2.1 First Amendment to Merger Agreement among Wit Capital Group, Inc., W/S
Merger Corp. and SoundView Technology Group, Inc.
4.1 Rights Agreement between Wit Capital Group, Inc. and American Stock
Transfer & Trust Company, as Rights Agent (Incorporated by reference to
Exhibit 4.1 to the quarterly report of Wit Capital Group, Inc. on Form
10-Q for the period ended June 30, 1999).
99.1 Press release issued by Wit Capital Group, Inc. on January 31, 2000
announcing the completion of Wit Capital Group, Inc.'s acquisition of
SoundView Technology Group, Inc.
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Exhibit 2.1
FIRST AMENDMENT TO MERGER AGREEMENT
This First Amendment to Merger Agreement (this "Amendment") is
entered into as of January 31, 2000 and is by and among SoundView Technology
Group, Inc., a Delaware corporation ("SoundView"), Wit Capital Group, Inc., a
Delaware corporation (the "Wit Capital"), and W/S Merger Corp., a Delaware
corporation ("Merger Sub").
WITNESSETH
WHEREAS, the parties hereto (the "Parties") are the parties to
that certain Agreement and Plan of Merger, dated as of October 31, 1999 (the
"Merger Agreement"), by and among SoundView, Wit Capital and Merger Sub.
WHEREAS, the Parties wish to amend the Merger Agreement and to
waive certain conditions to the obligations of the respective Parties as
hereinafter set forth;
NOW, THEREFORE, on the terms and subject to the conditions
herein set forth, the Parties, intending to be bound, hereby agree as follows:
Section 1. DEFINITIONS. Unless otherwise indicated,
capitalized terms used herein but not otherwise defined herein shall have the
respective meanings set forth in the Merger Agreement.
Section 2. AMENDMENT OF THE MERGER AGREEMENT. The Merger
Agreement is hereby amended as follows:
(a) Section 5.1 of the Merger Agreement is hereby amended by
deleting the words "plus the number of Shares subject to unexercised SoundView
Stock Options" in clause (ii)(B) of Section 5.1.
(b) Section 5.2 of the Merger Agreement is hereby amended by
(i) deleting the words "as of ten days prior to the then-scheduled Effective
Date" in the first sentence of Section 5.2 and replacing those deleted words
with the words "as soon as practicable after the Effective Date", and (ii)
deleting the words "the business day preceding the fifth day prior to the
Effective Date" in the second sentence of Section 5.2 and replacing those
deleted words with the words "February 10, 2000 or on such other date agreed to
by the parties hereto".
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(c) Section 5.3 of the Merger Agreement is hereby amended by
deleting the words "the business day before the third day prior to the Effective
Date" in the first sentence of Section 5.3 and replacing those deleted words
with the words "February 14, 2000 or on such other date agreed to by the parties
hereto".
Section 3. EFFECT. Except as amended hereby, the Merger
Agreement shall remain in full force and effect in all respects.
Section 4. COUNTERPARTS. This Amendment may be executed in two
or more counterparts, each of which shall be deemed an original, but all of
which taken together shall constitute one and the same agreement, it being
understood that all of the parties need not sign the same counterpart.
Section 5. GOVERNING LAW. THIS AMENDMENT, THE LEGAL RELATIONS
BETWEEN THE PARTIES AND THE ADJUDICATION AND THE ENFORCEMENT THEREOF, SHALL BE
GOVERNED BY AND INTERPRETED AND CONSTRUED IN ACCORDANCE WITH THE SUBSTANTIVE
LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF
LAW THEREOF.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed as of the date first above written.
WIT CAPITAL GROUP, INC.
By: /s/ Mark Loehr
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Name: Mark Loehr
Title: Director of Investment Banking
SOUNDVIEW TECHNOLOGY GROUP, INC.
By: /s/ Russell Crabs
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Name: Russell Crabs
Title: President
W/S MERGER CORP.
By: /s/ Mark Loehr
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Name: Mark Loehr
Title: Vice President, Treasurer and Secretary
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Exhibit 99.1
[LETTERHEAD OF WIT CAPITAL]
CONTACTS:
Citigate Dewe Rogerson Wit Capital Group, Inc.
Robin Weinberg Jennifer DiClerico
(212) 419-4284 (212) 253-4481
WIT CAPITAL COMPLETES SOUNDVIEW TECHNOLOGY MERGER;
EXPECTS TO TRIPLE SHARES AVAILABLE FOR ONLINE CUSTOMERS
January 27, 2000 - (New York) -- Wit Capital Group, Inc. (NASDAQ: WITC), parent
company of the pioneering online investment banking firm Wit Capital
Corporation, today announced that it has completed its merger with SoundView
Technology Group Inc., the Stamford-based private investment banking firm
recognized for its expertise in the technology sector.
"With this merger we have created a company which will be considered a
powerhouse in the Internet and technology space," said Ron Readmond, co-CEO of
Wit Capital. "By combining our industry knowledge with our innovative capital
raising ideas, we are able to connect investors and issuers into a more
meaningful and long-lasting relationship. Our financial performance to date has
proven the viability of our model. We have increased our revenues from $2
million in 1998 to $49 million in 1999, and now expect to surpass $200 million
in 2000.
"The addition of the SoundView team will enable us to demonstrate the
scalability of our business model, as we continue to expand the products and
services we offer to our clients and customer base. The first thing our
individual investors can expect to see is even more IPO shares being available
for distribution through our channel. In fact, what differentiates us among
Internet investment banks is our ability to supply an increasing number of
shares for our online customers." In 1999, Wit Capital co-managed 57 public
offerings and participated in the syndicate group of an additional 71, for a
total of 128.
On completion of the transaction, the combined company will have over 100
investment banking and equity research professionals focused exclusively on the
Internet and technology sectors. Mark Loehr, head of investment banking,
commented, "The real importance of this transaction is the exponential impact it
has on our ability to garner new underwriting business and generate revenues,
which in turn positions us to expand current operations. Since we first
announced the transaction last November, we have seen increasing interest from
issuers and are currently experiencing the strongest backlog of deals we have
seen to date. I am confident that this trend will continue."
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SoundView President and CEO Russ Crabs, who will take a seat on Wit Capital's
Board of Directors, said, "The synergies this combination brings to the table
are excellent. We believe the combined platform will allow us to provide
additional innovative products to both our institutional and individual
investors, which will benefit both our clients and shareholders."
ABOUT SOUNDVIEW TECHNOLOGY GROUP
SoundView is a private investment banking firm with an exclusive focus on
technology. Originally founded in 1979 as part of Gartner Group, a leading
market information technology research and consulting firm, SoundView was spun
off in 1985 and is currently employee owned. SoundView offers a range of
services in the technology sector including investment banking, research and
trading. The firm has 170 employees, with offices in Stamford, Connecticut and
San Francisco.
ABOUT WIT CAPITAL GROUP, INC.
Wit Capital Group, Inc. and its broker dealer subsidiary, Wit Capital
Corporation, were founded in New York in 1996 to create the first online
investment banking firm. Wit Capital Group, Inc. went public in June, 1999. With
offices in New York and San Francisco, Wit Capital Corporation is an
issuer-driven Internet investment banking firm that offers an array of
investment banking services, including underwriting for public offerings,
private equity services, strategic advisory, and institutional quality research.
Wit Capital Corporation also offers individual investors online brokerage
services that include access to IPOs and other securities offerings that in the
past have only been available to institutions and wealthy individuals.
Wit Capital Corporation is a registered broker-dealer and a member of NASD and
SIPC. Wit Capital Group, Inc. is listed on NASDAQ under the symbol "WITC." For
more information, please visit the Company's web site at
http://www.witcapital.com.
CERTAIN STATEMENTS IN THIS NEWS RELEASE CONSTITUTE "FORWARD-LOOKING STATEMENTS"
WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.
THESE FORWARD-LOOKING STATEMENTS, WHICH INCLUDE ALL OF THE STATEMENTS RELATING
TO OUR PROPOSED MERGER WITH SOUNDVIEW TECHNOLOGY GROUP, INC INVOLVE KNOWN AND
UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE OUR ACTUAL
RESULTS, PERFORMANCE OR ACHIEVEMENTS, OR THOSE OF THE INDUSTRY IN WHICH WE
OPERATE, TO BE MATERIALLY DIFFERENT FROM ANY EXPECTED FUTURE RESULTS,
PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED IN THESE FORWARD-LOOKING
STATEMENTS. FACTORS THAT COULD CAUSE OR CONTRIBUTE TO SUCH DIFFERENCES INCLUDE,
BUT ARE NOT LIMITED TO, THOSE ECONOMIC FACTORS THAT AFFECT THE MARKET FOR
CAPITAL RAISING, INCLUDING INITIAL PUBLIC OFFERINGS AND THOSE FACTORS DISCUSSED
IN THE REGISTRATION STATEMENT OF OUR INITIAL PUBLIC OFFERING OF COMMON STOCK,
THE PROXY AND REGISTRATION STATEMENT RELATING TO THE PROPOSED MERGER WITH
SOUNDVIEW AND PERIODIC REPORTS FILED FROM TIME TO TIME WITH THE SECURITIES &
EXCHANGE COMMISSION.
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