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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 April 24, 2000
eLoyalty CORPORATION
(Exact name of Registrant as specified in its charter)
DELAWARE 000-27975 36-4304577
(State or other jurisdiction (Commission (IRS Employer
or incorporation) File Number) identification No.)
150 FIELD DRIVE, SUITE 250,
LAKE FOREST, ILLINOIS 60045
(Address of principal executive offices)
(847) 582-7000
(Registrant's telephone number, including area code)
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eLoyalty CORPORATION
CURRENT REPORT DATED APRIL 24, 2000
Item 5. Other Events
See attached Exhibit 99.1, press release announcing signing of letter
of intent with regard to investment by Technology Crossover Ventures of $27
million in eLoyalty Corporation through the acquisition of 2 million newly
issued common shares at a price of $13.50 per share.
Item 7. Financial Statements and Exhibits
(c) Exhibit Number Exhibit
99.1 Registrant's April 24, 2000 press release.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
eLoyalty CORPORATION
/s/ Timothy J. Cunningham
---------------------------
Timothy J. Cunningham
Chief Financial Officer
Dated: April 24, 2000
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EXHIBIT 99.1
Contact:
Timothy J. Cunningham
eLoyalty Corporation
(847) 582-7015
timothy [email protected]
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Technology Crossover Ventures to Invest $27 Million in eLoyalty
TCV also announces intention to purchase up to an additional 1.5 million
eLoyalty shares in the open market
LAKE FOREST, ILL., APRIL 24, 2000 --- eLoyalty Corporation (NASDAQ: ELOY) today
announced that it has signed a letter of intent with Technology Crossover
Ventures (TCV) providing for TCV's investment of $27 million in eLoyalty,
through the acquisition of 2 million newly issued common shares, at a price of
$13.50 per share, which was the closing price of eLoyalty stock on the signing
date. eLoyalty will use the funding to continue its rapid expansion, build out
its infrastructure and aggressively launch its ASP model with its newly
announced Loyalty Foundation(TM) offering.
In addition, TCV intends to purchase up to 1.5 million shares of eLoyalty common
stock in the open market or through privately negotiated transactions with
existing shareholders of eLoyalty. The amount and timing of TCV's acquisition of
those shares will be subject to market conditions and applicable securities
laws, and TCV is not obligated to make any purchases.
As of March 31, 2000, TCV owned almost 1.7 million shares of eLoyalty, or
approximately 3.6% of eLoyalty's 47.1 million shares then outstanding. TCV is a
venture capital firm based in Palo Alto, CA. Jay Hoag, a member of the Board of
Directors of eLoyalty, is a general partner of TCV.
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The Board of Directors of eLoyalty has authorized management to enter into
binding, definitive agreements for the issuance of the common shares, which will
contain customary conditions for a transaction of this type, including receipt
of a fairness opinion. There can be no assurances that a binding, definitive
agreement will be entered into, or if entered into that the transactions
contemplated thereby will be consummated. The transaction is expected to close
after the early termination or expiration of the Hart-Scott-Rodino waiting
period.
The securities to be sold to TCV by eLoyalty will not be registered under the
Securities Act of 1933, as amended, and may not be offered or sold in the United
States absent registration or an applicable exemption from registration
requirements. In addition, eLoyalty believes that this transaction will fulfill
its obligation, pursuant to the IRS ruling received in conjunction with its
February 2000 spin off from Technology Solutions Company, to raise equity within
twelve months following that spin off.
About eLoyalty
eLoyalty (NASDAQ: ELOY) is a global business/management consulting and systems
integration organization focused exclusively on building customer loyalty. With
more than 800 professionals in offices throughout North America, Europe and
Australia, eLoyalty delivers the proven proficiencies, technologies and business
practices that span the full spectrum of a company's operations including the
Internet, call centers, marketing channels, sales force optimization, customer
service, and field service and logistics. eLoyalty was named the 1999 Solutions
Integrator of the Year by Solutions Integrator Magazine as part of their SI
Impact Awards. For more information, please go to the company's web site at
www.eloyaltyco.com or call 877-2-ELOYAL.
ASSUMPTIONS UNDERLYING CERTAIN FORWARD-LOOKING STATEMENTS AND FACTORS THAT MAY
AFFECT FUTURE RESULTS
This press release includes or may include certain forward-looking statements
that involve risks and uncertainties. This press release contains certain
forward-looking statements concerning the Company's financial position, business
strategy, budgets, projected costs and plans and objectives of management for
future operations as well as other statements including words such as
"anticipate," "believe," "plan," "estimate," "expect," "intend," and other
similar expressions. Although the Company believes its expectations reflected in
such forward-looking statements are based on reasonable assumptions, readers are
cautioned that no assurance can be given that such expectations will prove
correct and that actual results and developments may differ materially from
those conveyed in such forward-looking statements. Important factors that could
cause actual results to differ materially from the expectations reflected in the
forward-looking statements in this press release include, among others, the pace
of technological change, the Company's ability to manage growth and attract and
retain employees, general business and economic conditions in the Company's
operating regions, market conditions and competitive and other factors, as more
fully described in the Company's periodic reports filed with the Securities and
Exchange Commission from time to time. Such forward-looking statements speak
only as of the date on which they are made and the Company does not undertake
any obligation to update any forward-looking statement to reflect events or
circumstances after the date of this press release. If the Company does update
or correct one or more forward-looking statements, readers, investors and others
should not conclude that the Company will make additional updates or corrections
with respect thereto or with respect to other forward-looking statements. Actual
results may vary materially.
