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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
NFRONT, INC.
(Name of Issuer)
COMMON STOCK
(Title of Class of Securities)
65334N10
____________
(CUSIP Number)
KEVIN MCDONNELL
DIGITAL INSIGHT CORPORATION
26025 MUREAU ROAD
CALABASAS, CA 91302
(818) 871-0000
(Name, Address and Telephone Number of Person Authorized to Receive Notices and
Communications)
NOVEMBER 21, 1999
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Sections 240.13-1(e), 240.13d-(f) or 240.13d-1(g),
check the following box.
NOTE: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Section 240.13d-7(b)
for other parties to whom copies are to be sent.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
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<TABLE>
<C> <S>
- -------------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Digital Insight I.R.S. Identification No.: 770493132
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)
(b)
N/A
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e)
N/A
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
STATE OF DELAWARE
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NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY N/A
OWNED BY EACH
REPORTING PERSON
WITH
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8 SHARED VOTING POWER
5,823,051 (1)
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9 SOLE DISPOSITIVE POWER
N/A
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10 SHARED DISPOSITIVE POWER
N/A
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,823,051 (1)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
41%
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14 TYPE OF REPORTING PERSON*
CO
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</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) 5,823,051 shares of nFront, Inc. ("nFront") Common Stock are subject
to Shareholder Agreements entered into by Digital and certain shareholders of
nFront (discussed in Items 3 and 4 below). Digital expressly disclaims
beneficial ownership of any of the shares of nFront Common Stock covered by the
Shareholder Agreements. Based on the number of shares of nFront Common Stock
outstanding as of November 15, 1999 (as represented by nFront in the Merger
Agreement discussed in Items 3 and 4), the number of shares of nFront Common
Stock indicated represents approximately 41% of the outstanding nFront Common
Stock.
SCHEDULE 13D Page 2 of 9
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ITEM 1. SECURITY AND ISSUER.
This statement on Schedule 13D (this "Statement") relates to the Common
Stock of nFront, Inc. ("nFront") a Georgia corporation ("nFront" or "Issuer").
The principal executive offices of nFront are located at 520 Guthridge Court,
N.W., Suite 100, Norcross, GA 30092.
ITEM 2. IDENTITY AND BACKGROUND.
The name of the corporation filing this statement is Digital Insight
Corporation, a Delaware corporation ("Digital"). Digital is the leading
provider of real time Internet banking services to community financial
institutions with assets of less than $10 billion. The address of Digital's
principal business is 26025 Mureau Road, Calabasas, CA 91302. The address of
Digital's executive offices is the same as the address of its principal
business.
Set forth on Schedule A is the name of each of the directors and executive
officers of Digital, and their present principal occupation or employment,
including the name, principal business and address of any corporation or other
organization in which such employment is conducted, as of the date hereof to
Digital's knowledge.
Neither Digital, nor to Digital's knowledge, any person named on Schedule A
hereto is required to disclose legal proceedings pursuant to Items 2(d) or 2(e).
To Digital's knowledge, except as set forth on Schedule A, each of the
individuals identified on Schedule A is a citizen of the United States.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Pursuant to an Agreement and Plan of Reorganization dated as of November
21, 1999 (the "Merger Agreement"), among Digital, Black Transitory Corporation,
a Delaware corporation and wholly-owned subsidiary of Digital ("Merger Sub") and
nFront, and subject to the conditions set forth therein (including approval by
stockholders of nFront and Digital), Merger Sub will merge with and into nFront
and nFront will become a wholly-owned subsidiary of Digital (such events
constituting the "Merger"). Once the Merger is consummated, Merger Sub will
cease to exist as a corporation and all of the business, assets, liabilities and
obligations of Merger Sub will be merged into nFront with nFront remaining as
the surviving corporation (the "Surviving Corporation").
As an inducement for Digital to enter into the Merger Agreement and in
consideration thereof, certain shareholders of nFront (the "Shareholders")
entered into individual shareholder agreements with Digital (collectively the "
Shareholder Agreements") whereby each shareholder agreed, severally and not
jointly, to vote all of the shares of nFront Common Stock beneficially owned by
him in favor of approval and adoption of the Merger Agreement and approval of
the Merger and certain related matters. Digital did not pay additional
consideration to any Shareholder in connection with the execution and delivery
of the Shareholder Agreements.
References to, and descriptions of, the Merger, the Merger Agreement and
the Shareholder Agreements as set forth herein are qualified in their entirety
by reference to the copies of the Merger Agreement and the Shareholder
Agreements, respectively, included as Exhibits to the Form 8-K filed by Digital
on November 24, 1999.
ITEM 4. PURPOSE OF TRANSACTION.
(a) Not applicable.
(b) As described in Item 3 above, this statement relates to the Merger of
Merger Sub, a wholly-owned subsidiary of Digital, with and into nFront in a
statutory merger pursuant to the applicable provisions of Georgia Law and
Delaware Law. At the effective time of the Merger, the separate existence of
Merger Sub will cease and nFront will continue as the Surviving Corporation and
as a wholly-owned subsidiary of Digital. Each holder of outstanding nFront
Common Stock will receive, in exchange for each share of nFront Common Stock
held by such holder, 0.579 shares of Digital Common Stock. Digital will assume
each outstanding option to purchase nFront Common Stock Option under nFront's
stock option plans.
SCHEDULE 13D Page 3 of 9
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Pursuant to the Shareholder Agreements, the Shareholders have irrevocably
appointed Digital as their lawful attorney and proxy. Such proxy gives Digital
the limited right to vote each of the 5,823,051 shares (including options
exercisable within 60 days of November 21, 1999) of nFront Common Stock
beneficially owned by the Shareholders in all matters related to the Merger. In
exercising its right to vote the shares as lawful attorney and proxy of the
Shareholders, Digital (or any nominee of Digital) will be limited, at every
nFront shareholders meeting and every written consent in lieu of such a meeting
to vote the shares in favor of approval and adoption of the Merger Agreement, in
favor of approval of the Merger and in favor of each matter that could
reasonably be expected to facilitate the Merger. The Shareholders may vote the
shares on all other matters. The Shareholder Agreements terminate upon the
earlier to occur of (i) such date and time as the Merger shall become effective
in accordance with the terms and provisions of the Merger Agreement, or (ii)
such date and time as the Merger Agreement shall have been terminated pursuant
to Article VII thereof.
The purpose of the transactions under the Shareholder Agreements are to
enable Digital and nFront to consummate the transactions contemplated under the
Merger Agreement.
(c) Not applicable.
(d) It is anticipated that upon consummation of the Merger, the directors
of the Surviving Corporation shall be the current directors of Merger Sub. It
is anticipated that the initial officers of the Surviving Corporation shall be
the officers of nFront, until their respective successors are duly appointed.
(e) Other than as a result of the Merger described in Item 3 above, not
applicable.
(f) Not applicable.
(g) Upon consummation of the Merger, the Certificate of Incorporation of
Merger Sub, as in effect immediately prior to the Merger, shall be the
Certificate of Incorporation of the Surviving Corporation until thereafter
amended as provided by Delaware Law and such Certificate of Incorporation. Upon
consummation of the Merger, the Bylaws of Merger Sub, as in effect immediately
prior to the Merger, shall be the Bylaws of the Surviving Corporation until
thereafter amended.
(h) - (i) If the Merger is consummated as planned, the nFront Common Stock
will be deregistered under the Act and delisted from The Nasdaq National Market.
SCHEDULE 13D Page 4 of 9
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(j) Other than described above, Digital currently has no plan or proposals
which relate to, or may result in, any of the matters listed in Items 4(a) - (j)
of Schedule 13D (although Digital reserves the right to develop such plans).
References to, and descriptions of, the Merger Agreement and the
Shareholder Agreements as set forth above in this Item 4 are qualified in their
entirety by reference to the copies of the Merger Agreement and the Shareholder
Agreements, respectively, included as Exhibits to the Form 8-K filed by Digital
on November 24, 1999.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) - (b) As a result of the Shareholder Agreements, Digital may be deemed
to be the beneficial owner of at least 5,823,051 shares of nFront Common Stock.
Such nFront Common Stock constitutes approximately 41% of the issued and
outstanding shares of nFront Common Stock based on the number of shares of
nFront Common Stock outstanding as of November 15, 1999 (as represented by
nFront in the Merger Agreement discussed in Items 3 and 4). Digital may be
deemed to have the shared power to vote the Shares with respect to those matters
described above. However, Digital (i) is not entitled to any rights as a
shareholder of nFront as to the Shares and (ii) disclaims any beneficial
ownership of the shares of nFront Common Stock which are covered by the
Shareholder Agreements.
To Digital's knowledge, no person listed on Schedule A has an ownership
interest in nFront.
Set forth on Schedule B are the names of those shareholders of nFront that
have entered into a Shareholder Agreement with Digital, and their present
principal occupation or employment, including the name, principal business and
address of any corporation or other organization in which such employment is
conducted, to Digital's knowledge.
To Digital's knowledge, no transactions in the class of securities reported
have been effected during the past sixty days by any person named pursuant to
Item 2.
(c) To the knowledge of Digital, no transactions in the class of
securities reported have been effected during the past sixty days by any person
named pursuant to Item 2.
(d) To the knowledge of Digital, no other person has the right to receive
or the power to direct the receipt of dividends from, or the proceeds from the
sale of, the securities of nFront reported on herein.
(e) N/A.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDING OR RELATIONSHIPS WITH RESPECT TO
SECURITIES OF THE ISSUER.
Other than the Merger Agreement and the exhibits thereto, including the
Shareholder Agreements and the Stockholder Agreements, to the knowledge of
Digital, there are no contracts, arrangements, understandings or relationships
among the persons named in Item 2 and between such persons and any person with
respect to any securities of nFront, including but not limited to transfer or
voting of any of the securities, finder's fees, joint ventures, loan or option
arrangement, puts or calls, guarantees of profits, division of profits or loss,
or the giving or withholding of proxies.
ITEM 7. MATERIALS TO BE FILED AS EXHIBITS.
N/A
SCHEDULE 13D Page 5 of 9
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: December 1, 1999 DIGITAL INSIGHT CORPORATION
By: /s/ Kevin McDonnell
-------------------------------
Kevin McDonnell
Chief Financial Officer
SCHEDULE 13D Page 6 of 9
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Schedule A
DIRECTORS AND EXECUTIVE OFFICERS OF
DIGITAL INSIGHT CORPORATION
The following table sets forth the name, business address and present
principal occupation or employment of each director and executive officer of
Digital. Except as indicated below, the business address of each such person is
26025 Mureau Road, Calabasas, CA 91302.
<TABLE>
<CAPTION>
Officers Name Title and Present Principal Occupation
<C> <S>
John Dorman President, Chief Executive Officer & Chairman of the Board of Digital
Director
Paul Fiore Executive Vice President of Digital
Director
John Jarve General Partner Menlo Ventures
Director
Nader Kazeminy Vice Chairman, NJK Holding Corporation
Director
James McGuire President, NJK Holding Corporation
Director
Ofer Nemirovsky Managing Director, HarbourVest Partners, LLC
Director
Robert North Chief Executive Officer, HNC Software
Director
</TABLE>
SCHEDULE 13D Page 7 of 9
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Executive Officers Who Are Not Directors
<TABLE>
<CAPTION>
Name Title and Present Principal Occupation
<C> <S>
Mehariar Hasan Vice President, Product Management
Daniel Jacoby Vice President, Chief Technology Officer
Kevin McDonnell Vice President, Chief Financial Officer and Corporate
Secretary
Steven Reich Vice President, Sales and Marketing
Stephen Zarate Vice President, Chief Information Officer
</TABLE>
SCHEDULE 13D Page 8 of 9
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Schedule B
The following table sets forth the name and present principal occupation or
employment of each nFront shareholder that entered into a shareholder agreement
with Digital. Except as indicated below, the business address of each such
person is 520 Guthridge Court, N.W., Suite 100, Norcross, GA 30092.
<TABLE>
<CAPTION>
Shareholder Agreement Shareholder Shares Beneficially Owned
<S> <C>
Brady L. "Tripp" Rackley III, Chairman of the Board and Chief 3,000,000
Executive Officer
Brady L. Rackley, Director 1,299,301
Brady Rackley Retained Annuity Trust 728,750
Katherine Rackley Retained Annuity Trust 728,750
Katherine Rackley 66,250
TOTAL 5,823,051
</TABLE>
SCHEDULE 13D Page 9 of 9
