SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement [ ] Confidential, For Use of the
[ ] Definitive Proxy Statement Commission Only (as
[ ] Definitive Additional Materials permitted by Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to Rule
14a-11(c) or Rule 14a-12
InteliData Technologies Corporation
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on the table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
December 11, 1998
Dear Stockholder:
We cordially invite you to attend a Special Meeting of Stockholders
(the "Special Meeting") of InteliData Technologies Corporation (the "Company")
to be held on Tuesday, January 12, 1999 at 11:00 a.m. Eastern Time at the
Company's headquarters at 13100 Worldgate Drive, Suite 600, Herndon, Virginia
20170.
At the Special Meeting, you will be asked to consider and vote on the
adoption and approval of a proposal to amend the Company's Amended and Restated
Certificate of Incorporation to effect a one-for-four reverse stock split of the
issued and outstanding shares of the Company's Common Stock in order to attempt
to comply with the Nasdaq National Market's $1.00 minimum bid price requirement
for continued listing on the Nasdaq National Market.
Complete details of the business to be conducted at the Special Meeting
are given in the attached Notice of Special Meeting of Stockholders and Proxy
Statement. Directors and officers of the Company will be present at the Special
Meeting to respond to any questions that our stockholders may have.
The Board of Directors of the Company has determined that the proposal
to be considered at the Special Meeting is in the best interests of the Company
and its stockholders. For the reasons set forth in the Proxy Statement, the
Board unanimously recommends a vote "FOR" the proposal.
PLEASE SIGN AND RETURN THE ENCLOSED PROXY PROMPTLY. YOUR COOPERATION IS
APPRECIATED SINCE A MAJORITY OF THE COMMON STOCK MUST BE REPRESENTED, EITHER IN
PERSON OR BY PROXY, TO CONSTITUTE A QUORUM FOR THE CONDUCT OF BUSINESS.
On behalf of the Board of Directors and all of the employees of the
Company, I wish to thank you for your continued support. We appreciate your
interest.
Sincerely,
/s/ William F. Gorog
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William F. Gorog
Chairman of the Board
<PAGE>
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD JANUARY 12, 1999
TO THE STOCKHOLDERS:
Notice is hereby given that a Special Meeting of Stockholders of
InteliData Technologies Corporation, a Delaware corporation (the "Company"),
will be held on Tuesday, January 12, 1999, at the Company's headquarters at
13100 Worldgate Drive, Suite 600, Herndon, Virginia 20170 at 11:00 a.m. Eastern
Time, for the following purposes:
1. To consider and vote on the adoption and approval of the amendment to
the Company's Amended and Restated Certificate of Incorporation, which
will effect a one-for-four reverse stock split of the issued and
outstanding shares of the Common Stock, par value $0.001 per share, of
the Company; and
2. To transact such other business as may properly come before the Special
Meeting or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice. Any stockholders of record at the close of
business on December 8, 1998, will be entitled to vote at the Special Meeting
and at any adjournment thereof. In the event that there are not sufficient votes
for a quorum or to approve or ratify the foregoing proposal at the time of the
Special Meeting, the Special Meeting may be adjourned in order to permit further
solicitation of proxies by the Company. The transfer books will not be closed. A
list of stockholders entitled to vote at the Special Meeting will be available
for inspection at the offices of the Company. If you do not plan to attend the
Special Meeting in person, please sign, date and return the enclosed Proxy Form
in the envelope provided. If you decide to attend the Special Meeting, you may
revoke the proxy at any time before it is voted. The prompt return of your Proxy
Form will assist us in preparing for the Special Meeting.
By Order of the Board of Directors,
Albert N. Wergley
Vice President and Secretary
Herndon, Virginia
December 11, 1998
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, WHETHER OR
NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, DATE, SIGN AND
RETURN THE ENCLOSED PROXY FORM IN THE ENCLOSED POSTAGE PAID ENVELOPE. YOU MAY,
IF YOU WISH, REVOKE YOUR PROXY AT ANY TIME PRIOR TO THE TIME IT IS VOTED.
<PAGE>
INTELIDATA TECHNOLOGIES CORPORATION
13100 Worldgate Drive, Suite 600
Herndon, Virginia 20170
PROXY STATEMENT
For the Special Meeting of Stockholders
to be held January 12, 1999
This Proxy Statement is furnished to stockholders in connection with
the solicitation by the Board of Directors of InteliData Technologies
Corporation, a Delaware corporation (the "Company"), of proxies in the
accompanying form for use at the Special Meeting of Stockholders of the Company
(the "Special Meeting") to be held at the Company's headquarters at 13100
Worldgate Drive, Suite 600, Herndon, Virginia 20170, at 11:00 a.m. Eastern Time
on Tuesday, January 12, 1999, and at any adjournment thereof, for the purposes
set forth in this Proxy Statement and in the accompanying Notice of Special
Meeting of Stockholders.
It is anticipated that this Proxy Statement and the accompanying Proxy
Form will first be sent to stockholders on or about December 11, 1998. Only
holders of record of shares of Common Stock, $0.001 par value ("Common Stock"),
of the Company at the close of business on December 8, 1998 will be entitled to
notice of and to vote at the Special Meeting or any adjournment or adjournments
thereof. The Company's Board of Directors has unanimously approved the matter
being submitted for stockholder approval at the Special Meeting.
Voting and Revocability of Proxies
The enclosed Proxy Form is solicited by the Company's Board of
Directors, and when the Proxy Form is properly completed and returned, it will
be voted as directed by the stockholder on the Proxy Form. Stockholders are
urged to specify their choices on the enclosed Proxy Form. Any stockholder who
executes and returns the enclosed Proxy Form may revoke it at any time before it
is voted by giving written notice to the Secretary of the Company at the
Company's principal office, no later than the start of the Special Meeting, or
by voting in person at the Special Meeting. Unless so revoked, the shares
represented by the Proxy Form will be voted in accordance with the instructions
specified therein at the Special Meeting, if the Proxy Form is properly executed
and is received in time for voting. If no instructions are specified on the
signed Proxy Form, the shares represented by the Proxy Form will be voted FOR
the proposal described herein and will be voted in the proxy holders' discretion
as to other matters that may properly come before the Special Meeting.
The Board of Directors of the Company has unanimously approved a
proposal (the "Reverse Split Proposal") to amend the Company's Amended and
Restated Certificate of Incorporation (the "Certificate") to effect a
one-for-four reverse stock split of the Company's outstanding Common Stock,
subject to the approval by the stockholders of the Company. The Reverse Split
Proposal provides for the combination and reclassification of the presently
issued and outstanding shares of Common Stock, into a smaller number of shares
of identical Common Stock, on the basis of one share of Common Stock for each
four shares of Common Stock previously issued and outstanding (the "Reverse
Split"). Except as may result from the payment
<PAGE>
of cash for fractional shares as described below, each stockholder will hold the
same percentage of Common Stock outstanding immediately following the Reverse
Split as each stockholder did immediately prior to the Reverse Split. If
approved by the stockholders of the Company as provided herein, the Reverse
Split will be effected by an amendment to the Company's Certificate in
substantially the form attached to this Proxy Statement as Appendix A (the
"Reverse Split Amendment"), and will become effective upon the filing of the
Reverse Split Amendment with the Secretary of State of the State of Delaware
(the "Effective Time"). The following discussion is qualified in its entirety by
the full text of the Reverse Split Amendment, which is incorporated by reference
herein.
At the Effective Time, each share of Common Stock issued and
outstanding will automatically be reclassified and converted into one-fourth of
a share of Common Stock. Fractional shares of Common Stock will not be issued as
a result of the Reverse Split. Stockholders entitled to receive a fractional
share of Common Stock as a consequence of the Reverse Split will, instead,
receive from the Company a cash payment in U.S. dollars equal to such fraction
multiplied by four times the average of the closing bid and asked price per
share of the Common Stock as quoted on Nasdaq for the five trading days
immediately preceding the Effective Date.
A majority of the shares of Common Stock entitled to vote, whether
present in person or by proxy, will constitute a quorum for the transaction of
business at the Special Meeting. The affirmative vote of the holders of a
majority of the issued and outstanding shares of Common Stock will be required
to approve the Reverse Split Proposal. Except as otherwise required by law or by
the Company's Certificate, any other matters submitted for stockholder approval
at the Special Meeting will be decided by an affirmative vote of a majority of
the shares of Common Stock present in person or represented by proxy and
entitled to vote at the Special Meeting. All proxies not voted will not be
counted toward establishing a quorum for the transaction of business at the
Special Meeting. All abstentions or "broker non-votes" (i.e., shares of Common
Stock held by a broker or nominee not empowered to vote on a particular
proposal) shall be counted for purposes of determining the presence or absence
of a quorum, but such abstentions and "broker non-votes" shall not be counted
for purposes of determining the number of votes cast with respect to the
proposal. Accordingly, votes to ABSTAIN and votes AGAINST the proposal will have
the same effect in determining whether the proposal is approved. If a broker or
other record holder indicates on a Proxy Form that it does not have authority as
to certain shares to vote on a particular matter, those shares will not be
considered as present and entitled to vote with respect to that matter. Under
the New York Stock Exchange Rules, which govern brokers, brokers will not have
discretionary voting authority to vote on the Reverse Split Proposal and may not
vote for the Reverse Split Proposal without receiving instructions from the
beneficial owners of the shares of Common Stock.
Proxies solicited hereby will be returned to the Company and will be
tabulated by inspectors of election designated by the Board of Directors.
<PAGE>
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
As of December 8, 1998, the record date for the Special Meeting (the
"Record Date"), the total number of issued and outstanding shares of Common
Stock entitled to vote at the Special Meeting is approximately 31,584,116.
Stockholders are entitled to one (1) vote for each share of Common Stock. A
majority of the issued and outstanding shares of Common Stock present at the
Special Meeting in person or by proxy constitutes a quorum for the transaction
of business at the Special Meeting. The affirmative vote of the holders of a
majority of all the issued and outstanding shares of Common Stock is required to
approve the Reverse Split Proposal. In the event that there are not sufficient
votes for a quorum or to approve or ratify any proposal at the time of the
Special Meeting, the Special Meeting may be adjourned in order to permit the
further solicitation of proxies.
BENEFICIAL OWNERSHIP OF COMMON STOCK
The following table sets forth information as of December 1, 1998,
regarding beneficial ownership of the Company's Common Stock by (i) each person
who is known to the Company to own beneficially more than five percent of the
Company's Common Stock, (ii) each director of the Company, (iii) each executive
officer of the Company, and (iv) all current directors and executive officers of
the Company as a group. The information on beneficial ownership in the table and
the footnotes thereto is based upon the Company's records and the most recent
Schedule 13D or 13G filed by each such person or entity and information supplied
to the Company by such person or entity. Unless otherwise indicated, each person
has sole voting power and sole investment power with respect to the shares
shown. Under the proxy rules of the Securities and Exchange Commission, a person
who directly or indirectly has or shares voting power or investment power with
respect to a security is considered a beneficial owner of the security. Voting
power is the power to vote or direct the voting of securities, and investment
power is the power to dispose of or direct the disposition of securities.
Securities as to which voting power or investment power may be acquired within
60 days are also considered as beneficially owned under the proxy rules.
<PAGE>
<TABLE>
OWNERSHIP OF COMMON STOCK
Beneficial Ownership
---------------------------
Number of
Name of Stockholder Shares Percent
------------------- --------- -------
<S> <C> <C>
WorldCorp, Inc. 7,318,877 23.2%
13873 Park Center Road, Suite 490
Herndon, Virginia 22071
Morgan Stanley, Dean Witter, Discover & Co. 3,185,323 <F1> 10.1%
1585 Broadway
New York, New York 10036
World Airways, Inc. 1,615,396 5.1%
13873 Park Center Road, Suite 490
Herndon, VA 20171
John C. Backus, Jr. 717,270 <F2> 2.2%
William F. Gorog 641,212 <F3> 2.0%
Alfred S. Dominick, Jr. 100,000 *
Albert N. Wergley 36,331 <F4> *
Patrick F. Graham 31,666 <F5> *
L. William Seidman 22,500 <F6> *
Mark L. Baird 20,583 <F7> *
John J. McDonnell, Jr. 3,500 <F8> *
E. Philip Hanlon -- <F9> --
Directors and Executive Officers
as a Group (11 persons) 1,573,204 <F10> 4.8%
<FN>
- ---------------
<F1> As reported in the Schedule 13G filed with the SEC with information as of
December 31, 1997, includes shares held in accounts managed by Morgan
Stanley Asset Management Limited, a wholly owned subsidiary of Morgan
Stanley, Dean Witter, Discover & Co.
<F2> Includes 500,000 shares of Common Stock issuable upon the exercise of
options and options to purchase 125,000 shares transferred by Mr. Backus
to an irrevocable trust for the benefit of his children.
<F3> Includes 150,000 shares of Common Stock issuable upon the exercise of
options and 35,000 shares held by Mr. Gorog's wife. Does not include
10,000 shares held by a foundation trust for which Mr. Gorog is trustee.
Mr. Gorog disclaims beneficial ownership of such shares held by his wife
and by the trust.
<F4> Includes 36,331 shares of Common Stock issuable upon the exercise of
options.
<F5> Includes 31,166 shares of Common Stock issuable upon the exercise of
options. Does not include 7,318,877 shares of Common Stock beneficially
held by WorldCorp, of which Mr. Graham serves as chief executive officer.
Mr. Graham disclaims beneficial ownership of such shares.
<F6> Includes 9,500 shares of Common Stock issuable upon the exercise of
options.
<F7> Includes 18,583 shares of Common Stock issuable upon the exercise of
options.
<PAGE>
<F8> Includes 3,500 shares of Common Stock issuable upon the exercise of
options.
<F9> Mr. Hanlon joined the Company as Chief Financial Officer in October 1998.
<F10> Includes 893,078 shares of Common Stock issuable upon the exercise of
options.
* Less than 1%.
</FN>
</TABLE>
PROPOSAL TO BE VOTED ON AT THE SPECIAL MEETING
PROPOSAL - AMENDMENT TO THE COMPANY'S AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION TO EFFECT A ONE-FOR-FOUR
REVERSE STOCK SPLIT OF THE COMPANY'S ISSUED
AND OUTSTANDING COMMON STOCK
Introduction
The Board of Directors of the Company has unanimously approved an
amendment to the Company's Amended and Restated Certificate of Incorporation
(the "Certificate") to effect a reverse stock split, pursuant to which each four
shares of Common Stock of the Company will become one share of Common Stock (the
"Reverse Split"). The stockholders are being asked to approve this proposed
amendment to the Certificate. The Reverse Split will take effect, if at all,
after it is approved by the stockholders of the Company and after filing the
amendment to the Certificate with the Secretary of State of the State of
Delaware (the "Effective Date").
The Company expects that, if the Reverse Split Proposal is approved by
the stockholders at the Special Meeting, the Reverse Split Amendment will be
filed promptly. However, notwithstanding approval of the Reverse Split Proposal
by the stockholders of the Company, the Board of Directors of the Company may
elect not to file, or to delay the filing of, the Reverse Split Amendment, if
the Board of Directors determines that filing the Reverse Split Amendment would
not be in the best interest of the Company's stockholders at such time. Factors
leading to such a determination could include, without limitation, any possible
effect on Nasdaq listing or future securities offerings (see "Purpose of Reverse
Split" herein).
Purpose of Reverse Split
The Company's shares of Common Stock have been listed, and have traded,
on the Nasdaq National Market since November 1996, when the Company was created
by the mergers of two public companies, US Order, Inc. and Colonial Data
Technologies Corp., each of which also traded on the Nasdaq National Market
prior to the mergers. For continued listing on the Nasdaq National Market, it is
necessary that, among other things, the Company's shares of Common Stock
maintain a minimum bid price of at least $1.00 per share. Over the past several
months, the bid price of the Company's shares of Common Stock has fallen below
$1.00 per share. On November 6, 1998, the Company received a letter from Nasdaq
that the Company's minimum bid price was not in compliance with the minimum bid
price requirement for stock listed on Nasdaq. Nasdaq notified the Company that
if the Company is unable to demonstrate compliance with the $1.00 per share
minimum bid price requirement on or before the end of the
<PAGE>
ninety day period ended February 4, 1999, the Company's securities will be
delisted at the opening of business on February 8, 1999. The Company believes,
but cannot assure, that the Reverse Split will enable the Common Stock to trade
above the minimum bid price established by the Nasdaq Continued Listing
Requirements. The Company will become in compliance with the Nasdaq Continued
Listing Requirements if its Common Stock trades at or above the minimum bid
price of $1.00 per share for at least ten consecutive trading days prior to
February 4, 1999.
If the Company's securities are delisted from Nasdaq, trading, if any,
of the Company's securities would thereafter have to be conducted in the
non-Nasdaq over-the-counter market. In such an event, an investor could find it
more difficult to dispose of, or to obtain accurate quotations as to the market
value of, the Company's securities. In addition, if the Common Stock were to
become delisted from trading on Nasdaq and the trading price of the Common Stock
were to remain below $5.00 per share, trading in the Company's Common Stock may
also be subject to the requirements of certain rules promulgated under the
Securities Exchange Act of 1934, as amended, which require additional disclosure
by broker-dealers in connection with any trades involving a stock defined as a
"penny stock" (generally, any non-Nasdaq equity security that has a market price
of less than $5.00 per share, subject to certain exceptions). The additional
burdens imposed upon broker-dealers by such requirements could discourage
broker-dealers from effecting transactions in the Common Stock, which could
severely limit the market liquidity of the Common Stock and the ability of
investors to trade the Company's Common Stock. The Company believes that, if the
Reverse Split is approved, there is a greater likelihood that the minimum bid
price of the Common Stock will be maintained at a level over $1.00 per share.
Even though a reverse stock split, by itself, does not impact a
company's assets or prospects, reverse stock splits can result in a decrease in
the aggregate market value of a company's equity capital. The Board of
Directors, however, believes that this risk is offset by the prospect that the
Reverse Split will improve the likelihood that the Company will be able to
maintain its Nasdaq National Market listing and may, by increasing the per share
bid price, make an investment in the Common Stock more attractive for certain
investors. There can be no assurance, however, that approval of the Reverse
Split will succeed in raising the bid price of the Company's Common Stock above
$1.00 per share, that such minimum bid price, if achieved, would be maintained,
or that even if the Nasdaq's minimum bid price requirements were satisfied, the
Company's Common Stock would not be delisted by the Nasdaq for other reasons.
The Common Stock is currently registered under Section 12(g) of the
Exchange Act, and as a result, the Company is subject to the periodic reporting
and other requirements of the Act. The Reverse Split will not affect the
registration of the Common Stock under the Exchange Act and the Company has no
present intention of terminating its registration under the Exchange Act in
order to become a "private" company.
The Reverse Split will not affect the number of authorized shares.
Accordingly, the Reverse Split will have the effect of creating additional
authorized and unreserved shares of the Company's Common Stock. The Company has
no current plans to issue such shares; however, such shares may be used by the
Company for general corporate purposes.
<PAGE>
The increase in the authorized but unissued shares of Common Stock also
may have the effect of discouraging an attempt by another person or entity,
through acquisition of a substantial number of shares of Common Stock, to
acquire control of the Company with a view to effecting a merger, sale of assets
or similar transaction, since the issuance of new shares could be used to dilute
the stock ownership of such person or entity. Shares of authorized but unissued
Common Stock could be issued to a holder who would thereby have sufficient
voting power to assure that any such business combination or any amendment to
the Company's Certificate would not receive the stockholder vote required for
approval thereof. The Board of Directors has no current plans to issue any
shares of Common Stock for any such purpose and does not intend to issue any
stock except on terms or for reasons which the Board of Directors deems to be in
the best interests of the Company.
The Reverse Split may result in some stockholders owning "odd-lots" of
less than 100 shares of Common Stock. Brokerage commissions and other costs of
transactions in odd-lots are generally somewhat higher than the costs of
transactions in "round-lots" of even multiples of 100 shares.
As a result of the Reverse Split, the approximately 31,584,116 shares
of Common Stock outstanding on December 8, 1998 will become approximately
7,896,029 shares of Common Stock and any other shares issued prior to the
Effective Date will be similarly adjusted. In addition, on the Effective Date
each option and warrant to purchase Common Stock and any other convertible
security, outstanding on the Effective Date will be adjusted so that the number
of shares of Common Stock issuable upon their exercise shall be divided by four
(and corresponding adjustments will be made to the number of shares vested under
each outstanding option) and the exercise price of each option and warrant shall
be multiplied by four. No fractional shares will be issued upon the Reverse
Split. In lieu thereof, the Company will pay each holder of a fractional
interest an amount in cash equal to the value of such fractional interest as
described below.
For the above reasons, the Company believes that the Reverse Split is
in the best interests of the Company and its stockholders. There can be no
assurance, however, that the market price of the Common Stock after the Reverse
Split will be equal to the market price before the Reverse Split multiplied by
the split number, or that the market price following the Reverse Split will
either exceed or remain in excess of the current market price.
Exchange of Stock Certificates
If the Reverse Split is approved by the Company's stockholders, the
Company will instruct its transfer agent to act as its exchange agent (the
"Exchange Agent") in implementing the exchange of certificates representing
outstanding Common Stock. As soon as practicable after the Effective Date,
holders of Common Stock will be notified and requested to surrender their
certificates representing shares of Common Stock to the Exchange Agent in
exchange for certificates representing post-reverse split Common Stock.
Beginning on the Effective Date, each certificate representing shares of the
Company's Common Stock will be deemed for all corporate purposes to evidence
ownership of as many shares of post-reverse split Common Stock after applying
the split factor and otherwise making adjustments for fractional shares as
described herein. Stockholders will not be required to pay a transfer or other
fee in connection
<PAGE>
with the exchange of certificates. Stockholders should not submit certificates
until requested to do so.
Fractional Shares
No fractional shares of Common Stock will be issued as a result of the
Reverse Split. In lieu of receiving fractional shares, stockholders entitled to
receive a fractional share of Common Stock as a consequence of the Reverse Split
will, instead, receive from the Company a cash payment in U.S. dollars equal to
such fraction multiplied by four times the average of the closing bid and asked
price per share of the Common Stock as quoted on Nasdaq for the five trading
days immediately preceding the Effective Date.
Federal Income Tax Consequences of the Reverse Split
The following is a summary of the material federal income tax
consequences of the Reverse Split to a Company stockholder.
The Reverse Split will be nontaxable to a Company stockholder, except
for the receipt of cash in lieu of a fractional share of post-Reverse Split
Common Stock. Consequently, (1) the holding period of shares of post-Reverse
Split Common Stock (including any fractional share interest) will include the
stockholder's holding period for the shares of Common Stock exchanged therefor,
provided that the shares of Common Stock are held as a capital asset at the
Effective Time, and (2) the aggregate basis of the shares of post-Reverse Split
Common Stock (including any fractional share interest) will be the same as the
aggregate basis of the shares of Common Stock exchanged therefor.
Cash received in lieu of a fractional share will be treated as if
the fractional share had been issued to the stockholder and then redeemed by the
Company for the cash. Accordingly, a stockholder receiving cash will recognize
taxable gain or loss equal to any difference between the amount of cash received
and the stockholder's basis in the fractional share. That basis will be an
allocable portion of the aggregate basis of the post-Reverse Split Common Stock
described above.
EACH STOCKHOLDER SHOULD CONSULT WITH THE STOCKHOLDER'S OWN TAX ADVISOR
ABOUT THE TAX CONSEQUENCES OF THE REVERSE SPLIT IN LIGHT OF THE STOCKHOLDER'S
PARTICULAR CIRCUMSTANCES, INCLUDING THE APPLICATION OF ANY STATE, LOCAL OR
FOREIGN TAX LAW.
Effect on Rights Plan
Pursuant to the Rights Agreement (the "Rights Agreement"), dated as of
January 21, 1998, between the Company and American Stock Transfer & Trust
Company (the "Rights Agent"), following the Reverse Split, the number of Rights
associated with each share of Common Stock issued and outstanding shall equal
the product of the number of Rights associated with such share of Common Stock
prior to the Reverse Split multiplied by four. In accordance with Section 12 of
the Rights Agreement, this Proxy Statement shall also serve as the
<PAGE>
certificate relating to an adjustment of Rights that is required to be filed
with the Rights Agent and mailed to each stockholder.
Accounting Effects of the Reverse Split
Following the Effective Date, the par value of the Company's Common
Stock will remain at $0.001 per share. As a result, the Company's stated capital
will be reduced and capital in excess of par value (paid-in capital) increased
accordingly. Stockholders' equity will remain unchanged.
No Dissenter's Rights
Under Delaware law, stockholders are not entitled to dissenter's rights
of appraisal with respect to the Reverse Split.
Miscellaneous
The Board of Directors may abandon the Reverse Split at any time before
or after the Special Meeting and prior to the filing of the amendment to the
Certificate related thereto with the Secretary of State of the State of Delaware
if for any reason the Board of Directors deems it advisable to do so.
Approval Required
Approval of the Reverse Split Proposal requires the affirmative vote of
the holders of a majority of all of the issued and outstanding shares of Common
Stock of the Company.
Recommendation of the Board of Directors
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR APPROVAL OF
THE PROPOSED AMENDMENT TO THE AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
EFFECTING THE REVERSE SPLIT.
OTHER MATTERS
At the date of this Proxy Statement the Company does not know of any
business to be presented for consideration at the Special Meeting other than
stated in the Notice of this Meeting. It is intended, however, that the persons
authorized by the Company to hold proxies solicited by this Proxy Statement may,
in the absence of instruction to the contrary, vote or act in accordance with
their best judgment with respect to any other proposal presented for action at
this Special Meeting.
EXPENSES OF SOLICITATION
The cost of solicitation of proxies for the Special Meeting will be
paid by the Company. In addition to solicitation of proxies by mail, the
officers, directors, and regular employees of the
<PAGE>
Company may solicit proxies on behalf of the Board of Directors in person or by
telephone, facsimile, telex or telegraph. No additional compensation will be
received by any officer, director or employee of the Company in connection with
any such proxy solicitation. Brokerage houses, nominees, fiduciaries, and other
custodians will be requested by the Company to forward proxy soliciting material
to beneficial owners of shares held of record by them, and upon request, the
Company may reimburse them for reasonable out-of-pocket expenses incurred in
doing so.
STOCKHOLDER PROPOSALS
Pursuant to Rule 14a-8 under the Exchange Act, stockholders may present
proper proposals for inclusion in the Company's proxy statement and for
consideration at the 1999 Annual Meeting of Stockholders by submitting their
proposals to the Company in a timely manner. In order to be considered for the
1999 Annual Meeting of Stockholders, stockholder proposals must be received at
the Company's headquarters, attention of the Secretary, 13100 Worldgate Drive,
Suite 600, Herndon, Virginia 20170 no later than January 15, 1999, and have
complied with the requirements of Rule 14a-8 of the Securities Exchange Act of
1934, as amended.
By Order of the Board of Directors,
Albert N. Wergley
Secretary
<PAGE>
REVOCABLE PROXY
INTELIDATA TECHNOLOGIES CORPORATION
SPECIAL MEETING OF STOCKHOLDERS
January 12, 1999
11:00 a.m. Eastern Time
The undersigned hereby appoints William F. Gorog and Albert N. Wergley,
each with full power of substitution, to act as attorneys and proxies for the
undersigned, and to vote all shares of Common Stock of the Company which the
undersigned is entitled to vote only at the Special Meeting of Stockholders, to
be held on January 12, 1999, at 11:00 a.m. Eastern Time at the Company's
headquarters at 13100 Worldgate Drive, Suite 600, Herndon, Virginia 20170 and at
any and all adjournments thereof, as follows:
The adoption and approval of an amendment to the Company's Amended and
Restated Certificate of Incorporation to effect a one-for-four reverse
stock split of the issued and outstanding shares of the Common Stock,
par value $0.001 per share, of the Company.
FOR AGAINST ABSTAIN
--- ------- -------
[ ] [ ] [ ]
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
THE LISTED PROPOSAL.
<PAGE>
[BACK SIDE]
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
This proxy is revocable and will be voted as directed, but if no
instructions are specified, this proxy will be voted FOR the proposal listed. If
any other business is presented at the Special Meeting, including whether or not
to adjourn the meeting, this proxy will be voted by those named in this proxy in
their best judgment. At the present time, the Board of Directors knows of no
other business to be presented at the Special Meeting.
The undersigned acknowledges receipt from the Company prior to the
execution of this proxy of a Notice of Special Meeting of Stockholders and of a
Proxy Statement dated December 11, 1998, relating to this meeting.
Please sign exactly as your name appears on this card. When signing as
attorney, executor, administrator, trustee or guardian, please give your full
title. If shares are held jointly, each holder may sign but only one signature
is required.
Dated:
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SIGNATURE OF STOCKHOLDER
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SIGNATURE OF STOCKHOLDER
<PAGE>
Appendix A
Certificate of Amendment
to the
Amended and Restated Certificate of Incorporation
of
INTELIDATA TECHNOLOGIES CORPORATION
InteliData Technologies Corporation, a corporation duly organized and existing
under and by virtue of the Delaware General Corporation Law (the "Company"),
does hereby certify that:
1. The amendment to the Company's Amended and Restated Certificate of
Incorporation, set forth below, was duly adopted in accordance with the
provisions of Section 242 of the Delaware General Corporation Law. At a
meeting of the Board of Directors of the Company, resolutions were duly
adopted setting forth a proposed amendment to the Amended and Restated
Certificate of Incorporation of the Company, declaring the amendment to
be advisable and calling a Special Meeting of Stockholders of the
Company for consideration of the amendment.
2. Article IV of the Company's Amended and Restated Certificate of
Incorporation shall be amended by the addition of the following
provision:
Simultaneously with the effective date of this amendment (the
"Effective Date"), each four shares of the Company's Common
Stock, par value $.001 per share, issued and outstanding
immediately prior to the Effective Date (the "Old Common Stock")
shall, automatically and without any action on the part of the
holder thereof, be reclassified as and changed, pursuant to a
reverse stock split (the "Reverse Stock Split"), into one share
of the Company's outstanding Common Stock (the "New Common
Stock"), subject to the treatment of fractional share interests
as described below. Each holder of a certificate or certificates
which immediately prior to the Effective Date represented
outstanding shares of Old Common Stock (the "Old Certificates,"
whether one or more) shall be entitled to receive upon surrender
of such Old Certificates to the Company's Transfer Agent for
cancellation, a certificate or certificates (the "New
Certificates," whether one or more) representing the number of
whole shares of the New Common Stock into and for which the
shares of the Old Common Stock formerly represented by such Old
Certificates so surrendered, are reclassified under the terms
hereof. From and after the Effective Date, Old Certificates shall
thereupon be deemed for all corporate purposes to evidence
ownership of New Common Stock in the appropriately reduced whole
number of shares. No certificates or scrip representing
fractional share interests in New Common Stock will be issued,
and no such fractional share interest will entitle the holder
thereof to vote, or to any rights of a stockholder of the
Company. In lieu of any fraction of a share of New Common Stock
to which the holder would otherwise be entitled, the holder will
receive a cash payment in U.S. dollars equal to such
<PAGE>
fraction multiplied by four times the average of the closing bid
and asked price per share of Common Stock as quoted on Nasdaq for
the five trading days immediately preceding the Effective Date.
If more than one Old Certificate shall be surrendered at one time
for the account of the same stockholder, the number of full
shares of New Common Stock for which New Certificates shall be
issued shall be computed on the basis of the aggregate number of
shares represented by the Old Certificates so surrendered. In the
event that the Company's Transfer Agent determines that a holder
of Old Certificates has not surrendered all his certificates for
exchange, the Transfer Agent shall carry forward any fractional
share until all certificates of that holder have been presented
for exchange such that payment for fractional shares to any one
person shall not exceed the value of one share. If any New
Certificate is to be issued in a name other than that in which it
was issued, the Old Certificates so surrendered shall be properly
endorsed and otherwise in proper form for transfer, and the stock
transfer tax stamps to the Old Certificates so surrendered shall
be properly endorsed and otherwise in proper form for transfer,
and the person or persons requesting such exchange shall affix
any requisite stock transfer tax stamps to the Old Certificates
surrendered, or provide funds for their purchase, or establish to
the satisfaction of the Transfer Agent that such taxes are not
payable. From and after the Effective Date, the amount of capital
shall be represented by the shares of the New Common Stock into
which and for which the shares of the Old Common Stock are
reclassified, until thereafter reduced or increased in accordance
with applicable law. All references elsewhere in the Amended and
Restated Certificate of Incorporation to the "Common Stock"
shall, after the Effective Date, refer to the "New Common Stock".
3. That thereafter, pursuant to a resolution of the Board of Directors, a
Special Meeting of Stockholders of the Company was duly called and held
upon notice in accordance with Section 222 of the Delaware General
Corporation Law on January 12, 1999, at 11:00 a.m. Eastern Time at the
Company's headquarters located at 13100 Worldgate Drive, Suite 600,
Herndon, Virginia 20170, at which meeting the necessary number of
shares as required by the Delaware General Corporation Law were voted
in favor of the amendment.
IN WITNESS WHEREOF, the Company has caused this Certificate to be
executed by Albert N. Wergley, its Vice President and General Counsel, on this
___ day of January, 1999.
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Albert N. Wergley
Vice President and General Counsel
