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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 26, 1999.
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13E-3
RULE 13E-3 TRANSACTION STATEMENT
(PURSUANT TO SECTION 13(E) OF THE SECURITIES EXCHANGE ACT OF 1934)
INTERLINQ SOFTWARE CORPORATION
(Name of the Issuer)
INTERLINQ SOFTWARE CORPORATION
(Name of Person(s) Filing Statement)
COMMON STOCK, PAR VALUE $.01 PER SHARE
(Title of Class of Securities)
(CUSIP Number of Class of Securities)
Linda A. Schoemaker
Michael Deal
Perkins Coie LLP
1201 Third Avenue, 40th Floor
Seattle, Washington 98101
(206) 583-8888
(Name, Address, and Telephone Number of Person Authorized to
Receive Notices and Communications on Behalf of Person(s) Filing Statement)
This statement is filed in connection with (check the appropriate box):
a. [X] The filing of solicitation materials or an information statement
subject to Regulation 14A, Regulation 14C, or Rule 13e-3(c) under the Securities
Exchange Act of 1934.
b. [X] The filing of a registration statement under the Securities Act of
1933.
c. [ ] A tender offer.
d. [ ] None of the above.
Check the following box if the soliciting materials or information statement
referred to in checking box (a) are preliminary copies. [X]
CALCULATION OF FILING FEE
<TABLE>
<CAPTION>
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TRANSACTION VALUATION(1) AMOUNT OF FILING FEE
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<S> <C>
$44,251,101 $8,851
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</TABLE>
[X] Check box if any part of the fee is offset as provided by Rule
0-11(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
Amount previously paid: $7,866 Filing party: INTERLINQ Software
Corporation
Form or registration no.: Registration Date filed: January 22, 1999
Statement on Form S-4
(1) For purposes of calculation of the filing fee only, this amount is
based on (i) 5,128,662 (the number of shares of Interlinq common stock
outstanding as of January 21, 1999) minus 3,403,439 (the number of
shares of Interlinq common stock to be retained and issued in the
Merger) multiplied by $9.25 (the cash consideration per share of
Interlinq common stock), plus (ii) 3,403,439 (the number of shares of
Interlinq common stock to be retained and issued in the Merger)
multiplied by $8.313 (the average of the high and low sales prices of
Interlinq common stock on the Nasdaq National Market on January 22,
1999, which sum has been multiplied by 1/50th of one percent. As
permitted by Rule 0-11(a) under the Securities Exchange Act of 1934, as
amended, the amount paid by Interlinq indicated below has been
subtracted and the balance ($985) transferred by electronic funds
transfer to the Commission.
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INTRODUCTION.
This Rule 13e-3 Transaction Statement on Schedule 13E-3 is being filed
with the Securities and Exchange Commission (the "SEC") on behalf of INTERLINQ
Software Corporation, a Washington corporation ("Interlinq"), with respect to
the proposed merger pursuant to which Terlin, Inc., a Washington corporation
("Terlin"), will merge with and into Interlinq with Interlinq as the surviving
corporation (the "Merger"). As a result of the Merger, Interlinq may become a
private company, and shares of Interlinq common stock may not trade publicly on
the Nasdaq National Market. In addition, affiliates of Terlin, including W.R.
Hambrecht/INLQ, LLC and allied entities, expect to beneficially own
approximately 74.2% of Interlinq common stock immediately following the Merger.
If the Merger is completed, 1,250,000 shares of Interlinq common stock
outstanding prior to the Merger will remain outstanding, and all other
outstanding shares of Interlinq common stock will be converted into the right to
receive a cash payment of $9.25 per share (the "Cash-Out Amount"). In addition,
each of the approximately 2,150,000 shares of Terlin that will be outstanding
immediately prior to the Merger will be converted into one share of Interlinq
common stock in the Merger. Accordingly, Interlinq will have approximately
3,400,000 shares of common stock outstanding after the Merger. Subject to
certain limitations and the terms described in the Proxy Statement/Prospectus,
Interlinq shareholders will be able to elect, as to all or a part of such
shareholder's shares of Interlinq common stock, to retain such shares and
continue to own them after the Merger. If holders of more than 1,250,000 shares
of Interlinq common stock elect to retain their shares, shareholders making that
election will retain shares pro rata based on the number of shares they
initially requested to retain, and will receive the Cash-Out Amount for their
remaining shares. If holders of fewer than 1,250,000 shares elect to retain
their shares, shareholders who would otherwise receive the Cash-Out Amount for
all of their shares will instead retain a pro rata portion of their shares.
This Schedule 13E-3 is intended to satisfy the reporting requirements of
Section 13(e) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act").
The cross reference sheet below is being supplied pursuant to General
Instruction F to Schedule 13E-3 and shows the location of the information
required by Schedule 13E-3 in the Proxy Statement/Prospectus, filed with the SEC
on the date hereof immediately prior to the filing of this Schedule 13E-3. The
information in the Proxy Statement/Prospectus, including all appendices and
exhibits thereto, is hereby expressly incorporated herein by reference and the
responses to each item in this Schedule 13E-3 are qualified in their entirety by
the provisions of the Proxy Statement/Prospectus.
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CROSS REFERENCE SHEET
ITEM 1. ISSUER AND CLASS OF SECURITY SUBJECT TO THIS TRANSACTION.
(a)..................Cover Page; SUMMARY--The Companies
(b) .................STOCK PRICE AND DIVIDEND INFORMATION; DESCRIPTION
OF INTERLINQ CAPITAL STOCK
(c) .................STOCK PRICE AND DIVIDEND INFORMATION
(d) .................STOCK PRICE AND DIVIDEND INFORMATION
(e) .................Not applicable
(f) .................VOTING SECURITIES AND PRINCIPAL HOLDERS
THEREOF--Transactions by Certain Persons in
Interlinq Common Stock
ITEM 2. IDENTITY AND BACKGROUND.
(a) -- (g)...........Not applicable
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS.
(a)..................SPECIAL FACTORS--Background of the Merger;--
Interests of Certain Persons in the Merger
(b) .................SPECIAL FACTORS--Background of the Merger;--
Interests of Certain Persons in the Merger;--
Management Following the Merger; THE MERGER
AGREEMENT--Stock Options;--Management After the
Merger;--Indemnification of Directors and Officers
Pursuant to Merger Agreement
ITEM 4. TERMS OF THE TRANSACTION.
(a)..................SUMMARY; SPECIAL FACTORS; THE MERGER AGREEMENT;
REVERSE STOCK SPLIT; COMPARISON OF CERTAIN RIGHTS
OF INTERLINQ SHAREHOLDERS
(b) .................SPECIAL FACTORS--Background of the Merger;--
Interests of Certain Persons in the Merger; THE
MERGER AGREEMENT--Stock Options
ITEM 5. PLANS OR PROPOSALS OF THE ISSUER OR AFFILIATE.
(a)..................REVERSE STOCK SPLIT
(b) .................Not applicable
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(c) .................SPECIAL FACTORS--Management Following the Merger;
THE MERGER AGREEMENT--Management After the Merger
(d) .................RISK FACTORS--Risks Associated with the Merger;
SPECIAL FACTORS--Certain Effects of the Merger;--
Sources and Uses of Funds; THE MERGER AGREEMENT--
Financing
(e) .................Not applicable
(f) -- (g) ..........RISK FACTORS--Risks Associated with the Merger;
SPECIAL FACTORS--Nasdaq Delisting; REVERSE STOCK
SPLIT
ITEM 6. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a)..................SPECIAL FACTORS--Sources and Uses of Funds
(b) .................SPECIAL FACTORS--Sources and Uses of Funds; THE
MERGER AGREEMENT--Termination;--Fees and Expenses
(c) .................SPECIAL FACTORS--Sources and Uses of Funds
(d) .................Not applicable
ITEM 7. PURPOSE(S), ALTERNATIVES, REASONS AND EFFECTS.
(a)..................SUMMARY--Reasons for Merger; SPECIAL FACTORS--
Background of Merger;--Purpose and Structure of
Merger;--Opinion of Financial Advisor
(b) .................SPECIAL FACTORS--Background of Merger
(c) .................SUMMARY--Reasons for the Merger; SPECIAL FACTORS
--Background of the Merger;--Fairness of the
Merger;--Purpose and Structure of the Merger;
SPECIAL FACTORS--Opinion of Financial Advisor
(d) .................RISK FACTORS; SPECIAL FACTORS--Merger
Consideration; Stock Election;--Plans for
Interlinq After the Merger;--Interests of Certain
Persons in the Merger;--Management Following the
Merger;--Nasdaq Delisting;--Certain Effects of
the Merger; CERTAIN FEDERAL INCOME TAX CONSEQUENCES
OF THE MERGER; REVERSE STOCK SPLIT--Effects of
Reverse Stock Split; COMPARISON OF CERTAIN RIGHTS
OF INTERLINQ SHAREHOLDERS
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ITEM 8. FAIRNESS OF THE TRANSACTION.
(a) -- (b)...........SUMMARY--Recommendation of the
Interlinq Board;--Recommendations to Shareholders;
SPECIAL FACTORS--Background of the Merger;
--Fairness of the Merger; --Opinion of Financial
Advisor; REVERSE STOCK SPLIT--Reasons for Reverse
Stock Split; APPENDIX B--Opinion of Broadview
International LLC
(c) .................SUMMARY--The Merger - Vote Required; THE SPECIAL
MEETING--Record Date; Shares Entitled to Vote;
SPECIAL FACTORS--Purpose and Structure of the
Merger;--Vote Needed for Approval; REVERSE STOCK
SPLIT--Vote Needed for Approval
(d) -- (e) ..........SUMMARY--Recommendations to Shareholders; SPECIAL
FACTORS--Background of the Merger;--Fairness of
the Merger; --Opinion of Financial Advisor; REVERSE
STOCK SPLIT--Reasons for Reverse Stock Split;
APPENDIX B--Opinion of Broadview International LLC
(f) .................Not applicable
ITEM 9. REPORTS, OPINIONS, APPRAISALS AND CERTAIN NEGOTIATIONS.
(a) -- (c)...........SUMMARY--Reasons for Merger; --Opinion of Interlinq
Financial Advisor; SPECIAL FACTORS--Reasons for the
Merger;--Fairness of the Merger;--Opinion of
Financial Advisor; APPENDIX B--Opinion of Broadview
International LLC
ITEM 10. INTERESTS IN SECURITIES OF THE ISSUER.
(a)..................SPECIAL FACTORS--Interests of Certain Persons in
the Merger; VOTING SECURITIES AND PRINCIPAL HOLDERS
THEREOF
(b) .................VOTING SECURITIES AND PRINCIPAL HOLDERS
THEREOF--Transactions by Certain Persons in
Interlinq Common Stock
ITEM 11. CONTRACTS, ARRANGEMENTS OR UNDERSTANDINGS WITH RESPECT TO THE ISSUER'S
SECURITIES.
.............................SPECIAL FACTORS--Interests of Certain Persons in
the Merger
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ITEM 12. PRESENT INTENTION AND RECOMMENDATION OF CERTAIN PERSONS WITH REGARD TO
THE TRANSACTION.
(a) and (b)..........SPECIAL FACTORS--Recommendation of
the Interlinq Board;--Interests of Certain Persons
in the Merger; VOTING SECURITIES AND PRINCIPAL
HOLDERS THEREOF
ITEM 13. OTHER PROVISIONS OF THE TRANSACTION.
(a)..................SUMMARY--Dissenters' Rights; RIGHTS OF DISSENTING
INTERLINQ SHAREHOLDERS
(b) .................Not applicable
(c) .................Not applicable
ITEM 14. FINANCIAL INFORMATION.
(a) and (b)..........SELECTED FINANCIAL INFORMATION; UNAUDITED PRO FORMA
FINANCIAL INFORMATION
ITEM 15. PERSONS AND ASSETS EMPLOYED, RETAINED OR UTILIZED.
.............................SPECIAL FACTORS--Interests of Certain Persons in
the Merger
ITEM 16. ADDITIONAL INFORMATION.
.............................Proxy Statement/Prospectus and each Appendix and
Exhibit attached thereto
ITEM 17. MATERIAL TO BE FILED AS EXHIBITS.
(a) .................Not applicable
(b) .................Appendix B
(c)(1) ..............Appendix A
(d) .................Proxy Statement/Prospectus and related Notice of
Special Meeting
(e) .................Appendix F
(f) .................Not applicable
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ITEM 1. ISSUER AND CLASS OF SECURITY SUBJECT TO THIS TRANSACTION.
(a) The information set forth on the cover page and under "SUMMARY -
The Companies" of the Proxy Statement/Prospectus is incorporated herein by
reference.
(b) The information set forth under "STOCK PRICE AND DIVIDEND
INFORMATION" and "DESCRIPTION OF INTERLINQ CAPTIAL STOCK" in the Proxy
Statement/Prospectus is incorporated herein by reference.
(c) The information set forth on under "STOCK PRICE AND DIVIDEND
INFORMATION" in the Proxy Statement/Prospectus is incorporated herein by
reference.
(d) The information set forth under "STOCK PRICE AND DIVIDEND
INFORMATION" in the Proxy Statement/Prospectus is incorporated herein by
reference.
(e) Not applicable.
(f) The information set forth under "VOTING SECURITIES AND PRINCIPAL
HOLDERS THEREOF" in the Proxy Statement/Prospectus is incorporated herein by
reference.
ITEM 2. IDENTITY AND BACKGROUND.
This Schedule 13E-3 is being filed by Interlinq, the issuer of the class
of equity securities which is the subject of the Rule 13e-3 transaction.
(a) through (g) Not applicable.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS.
(a) (1) and (2) The information set forth under "SPECIAL FACTORS -
Background of the Merger" and "- Interests of Certain Persons in the Merger" in
the Proxy Statement/Prospectus is incorporated herein by reference.
(b) The information set forth under "SPECIAL FACTORS - Background of
the Merger," "- Interests of Certain Persons in the Merger" and "- Management
Following the Merger" and "THE MERGER AGREEMENT - Stock Options," "- Management
After the Merger" and "- Indemnification of Directors and Officers Pursuant to
the Merger Agreement" in the Proxy Statement/Prospectus is incorporated herein
by reference.
ITEM 4. TERMS OF THE TRANSACTION.
(a) The information set forth under "SUMMARY," "SPECIAL FACTORS,"
"THE MERGER AGREEMENT," "REVERSE STOCK SPLIT" and "COMPARISON OF CERTAIN
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RIGHTS OF INTERLINQ SHAREHOLDERS" in the Proxy Statement/Prospectus is
incorporated herein by reference.
(b) The information set forth under "SPECIAL FACTORS - Background of
the Merger," "- Interests of Certain Persons in the Merger" and "THE MERGER
AGREEMENT - Stock Options" in the Proxy Statement/Prospectus is incorporated
herein by reference.
ITEM 5. PLANS OR PROPOSALS OF THE ISSUER OR AFFILIATE.
(a) The information set forth under "REVERSE STOCK SPLIT" in the
Proxy Statement/Prospectus is incorporated herein by reference.
(b) Not applicable.
(c) The information set forth under "SPECIAL FACTORS - Management
Following the Merger" and "THE MERGER AGREEMENT - Management After the Merger"
in the Proxy Statement/Prospectus is incorporated herein by reference.
(d) The information set forth under "RISK FACTORS - Risks Associated
with the Merger," "SPECIAL FACTORS - Certain Effects of the Merger," " - Sources
and Uses of Funds" and "THE MERGER AGREEMENT - Financing" in the Proxy
Statement/Prospectus is incorporated herein by reference.
(e) Not applicable.
(f) and (g) The information set forth under "RISK FACTORS - Risks
Associated with the Merger," "SPECIAL FACTORS - Nasdaq Delisting" and "REVERSE
STOCK SPLIT" in the Proxy Statement/Prospectus is incorporated herein by
reference.
ITEM 6. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) The information set forth under "SPECIAL FACTORS - Sources and
Uses of Funds" in the Proxy Statement/Prospectus is incorporated herein by
reference.
(b) The information set forth under "SPECIAL FACTORS - Sources and
Uses of Funds," "THE MERGER AGREEMENT - Termination" and "- Fees and Expenses"
in the Proxy Statement/Prospectus is incorporated herein by reference.
(c) The information set forth under "SPECIAL FACTORS - Sources and
Uses of Funds" in the Proxy Statement/Prospectus is incorporated herein by
reference.
(d) Not applicable.
ITEM 7. PURPOSE(S), ALTERNATIVES, REASONS AND EFFECTS.
(a) The information set forth under "SUMMARY - Reasons for the
Merger," "SPECIAL FACTORS - Background of the Merger," "--Fairness of the
Merger," "--Purpose
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and Structure of the Merger" and "--Opinion of Financial Advisor" in the Proxy
Statement/Prospectus is incorporated herein by reference.
(b) The information set forth under "SPECIAL FACTORS - Background of
the Merger" in the Proxy Statement/Prospectus is incorporated herein by
reference.
(c) The information set forth under "SUMMARY - Reasons for the
Merger," "SPECIAL FACTORS - Background of the Merger," "--Fairness of the
Merger," "- Purpose and Structure of the Merger" and "--Opinion of Financial
Advisor" in the Proxy Statement/Prospectus is incorporated herein by reference.
(d) The information set forth under "RISK FACTORS," "SPECIAL FACTORS
- - Merger Consideration; Stock Election," "- Plans for Interlinq After the
Merger," "--Interests of Certain Persons in the Merger," "--Management Following
the Merger," "--Nasdaq Delisting," "- Certain Effects of the Merger," "--CERTAIN
FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER," "REVERSE STOCK SPLIT - Effect of
Reverse Stock Split," and "COMPARISON OF CERTAIN RIGHTS OF INTERLINQ
SHAREHOLDERS" in the Proxy Statement/Prospectus is incorporated herein by
reference.
ITEM 8. FAIRNESS OF THE TRANSACTION.
(a) and (b) The information set forth under "SUMMARY - Recommendation of
the Interlinq Board, - Recommendations to Shareholders," "SPECIAL FACTORS -
Background of the Merger," "--Fairness of the Merger," "--Opinion of Financial
Advisor," "REVERSE STOCK SPLIT - Reasons for the Reverse Stock Split" and
"APPENDIX B - Opinion of Broadview International LLC" in the Proxy
Statement/Prospectus is incorporated herein by reference.
(c) The information set forth under "SUMMARY-the Merger-Vote
Required," "THE SPECIAL MEETING - Record Date; Shares Entitled to Vote; Vote
Required," "SPECIAL FACTORS-Purpose and Structure of the Merger" "- Vote Needed
for Approval" and "REVERSE STOCK SPLIT - Vote Needed for Approval" in the Proxy
Statement/Prospectus is incorporated herein by reference.
(d) and (e) The information set forth under "SUMMARY - Recommendations
to Shareholders," "SPECIAL FACTORS - Background of the Merger," "--Fairness of
the Merger," "--Opinion of Financial Advisor," "REVERSE STOCK SPLIT - Reasons
for the Reverse Stock Split;" and "APPENDIX B - Opinion of Broadview
International LLC" in the Proxy Statement/Prospectus is incorporated herein by
reference.
(f) Not applicable.
ITEM 9. REPORTS, OPINIONS, APPRAISALS AND CERTAIN NEGOTIATIONS.
(a) - (c) The information set forth under "SUMMARY - Reasons for the
Merger," "--Opinion of Interlinq Financial Advisor," "SPECIAL FACTORS - Reasons
for the Merger," "--
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Fairness of Merger," "--Opinion of Financial Advisor," and "APPENDIX B--Opinion
of Broadview International LLC" in the Proxy Statement/Prospectus is
incorporated herein by reference.
ITEM 10. INTERESTS IN SECURITIES OF THE ISSUER.
(a) The information set forth under "SPECIAL FACTORS - Interests of
Certain Persons in the Merger" and "VOTING SECURITIES AND PRINCIPAL HOLDERS
THEREOF" in the Proxy Statement/Prospectus is incorporated herein by reference.
(b) The information set forth under "VOTING SECURITIES AND PRINCIPAL
HOLDERS THEREOF - Transactions by Certain Persons in Interlinq Common Stock" in
the Proxy Statement/Prospectus is incorporated herein by reference.
ITEM 11. CONTRACTS, ARRANGEMENTS OR UNDERSTANDINGS WITH RESPECT TO THE ISSUER'S
SECURITIES.
The information set forth under "SPECIAL FACTORS - Interests of Certain
Persons in the Merger" in the Proxy Statement/Prospectus is incorporated herein
by reference.
ITEM 12. PRESENT INTENTION AND RECOMMENDATION OF CERTAIN PERSONS WITH REGARD TO
THE TRANSACTION.
(a) and (b) The information set forth under "SPECIAL FACTORS -
Recommendation of the Interlinq Board," "-- Interests of Certain Persons in the
Merger" and "VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF" in the Proxy
Statement/Prospectus is incorporated herein by reference.
ITEM 13. OTHER PROVISIONS OF THE TRANSACTION.
(a) The information set forth under "SUMMARY - Dissenters' Rights"
and "RIGHTS OF DISSENTING INTERLINQ SHAREHOLDERS" in the Proxy
Statement/Prospectus is incorporated herein by reference.
(b) Not applicable.
(c) Not applicable.
ITEM 14. FINANCIAL INFORMATION.
(a) and (b) The information set forth under "SELECTED FINANCIAL
INFORMATION" and "Unaudited Pro Forma Financial Information" in the Proxy
Statement/Prospectus is incorporated herein by reference. Pursuant to General
Instruction D of Schedule 13e-3, Interlinq's Annual Report on Form 10-K for the
fiscal year ended June 30, 1998 and Interlinq's Quarterly Report on Form 10-Q
for the quarter ended September 30, 1998 are incorporated herein by reference.
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ITEM 15. PERSONS AND ASSETS EMPLOYED, RETAINED OR UTILIZED.
The information set forth under "SPECIAL FACTORS - Interests of Certain
Persons in the Merger" in the Proxy Statement/Prospectus is incorporated herein
by reference.
ITEM 16. ADDITIONAL INFORMATION.
Reference is hereby made to the Proxy Statement/Prospectus and to each
Appendix and Exhibit attached thereto, each of which is incorporated herein by
reference.
ITEM 17. MATERIAL TO BE FILED AS EXHIBITS.
(a) Not applicable.
(b) Opinion of Broadview International LLC (incorporated by reference
to Appendix B to the Proxy Statement/Prospectus).
(c) (1) Agreement and Plan of Merger, dated December 28, 1998,
between Interlinq and Terlin (incorporated by reference to Appendix A to the
Proxy Statement/Prospectus).
(2) Form of Voting Agreement (incorporated by reference to
Exhibit 10.1 to the Registration Statement on Form S-4
filed by Interlinq on the date hereof).
(d) Proxy Statement/Prospectus and related Notice of Special Meeting
and Proxy (incorporated by reference to the Proxy Statement/Prospectus and
related material filed under a Registration Statement on Form S-4 by Interlinq
on the date hereof).
(e) Chapter 23B.13 of the Washington Business Corporation Act
(incorporated by reference to Appendix F to the Proxy Statement/Prospectus).
(f) Not applicable.
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SIGNATURE
After due 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.
January 22, 1998
-------------------------------------------
(Date)
/s/ JIRI M. NECHLEBA
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(Signature)
Chairman, Chief Executive Officer
and President
-------------------------------------------
(Name and Title)
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